Full text of Commercial and Financial Chronicle : December 21, 1950, Vol. 172, No. 4970

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Reg. U. S. Pat. Office

Volume 172

Number 4970

New

EDITORIAL

We See It

general order of magnitude of

By HERBERT HOOVER*

situation
a

might

many

ABA President, contending much of current inflation is

"government induced" to create "synthetic prosperity,"
denies bank credit policies

played a part in it. Attacks
policy and contends government credit
agencies have over-extended credits, inducing inflation.
Sees dangers threatening stability of our political and
economic life, and concludes job of combating inflation
should be shared by all segments of economy.
low interest rate

which

very

be termed remilitarization of our man¬
able to effect the change.

power as soon as we are

are

bring at
once into the
foreground the old, old question
of inflation and the means by which it is possible
to
avpid it or at all events reduce it to a minimum.
The President has now qualified his demand for
a
pay-as-we-go plan of procedure by adding the
phrase: "as nearly as possible." Appeals, plainly
officially inspired, are being made to the rank
and file to buy government
obligations in order
that the Treasury may be able to avoid borrow¬
ing from the banks, the explanation being ap¬
pended that sale of bonds to the banks is "infla¬
tionary" while sale of bonds to Tom, Dick and
Harry is not "inflationary."

freedom

trol

active

markets

page

Creator)

the

hold

Our

clock

pur

life.

time

of
It

back

all

PICTURES

taken at the
on

world.

direction.
do

The Global Military

Situation

We may first survey the global
military situation.
There is today
only one center of aggression on the
•

would

Shelton

James

Silver Anniversary Dinner of

the

hands

the

centuries

the
on

page

the

They have probably over 300 trained and equipped com¬
bat divisions with over 30*000 tanks,
10,000 tactical

Continued

New York

December 8 at the Waldorf-Astoria Hotel, appear on pages

♦An

Dec.

address

20,

Mr.

Hoover

over

keyes fibre

System,

State and

co.

Franklin Hustodian Funds,

Common

Municipal

inc.

600 Branches

A Mutual Fund

n. e. gas & electric co.

Bonds

Canada

across

lowell shops

sac0

page

Security Dealers
21, 22, 23 and 24.

dwight mfg. co.

A &

Broadcasting

almy

h0llingw0rth & whitney

Class

Mutual

1950.

bates mfg. co.
dewey

Herbert Hoover

Communist-con¬

trolled Asian-European land mass of 800,000,000 people.

turn

through

That

earth.

by Mr. Shelton at the Third National Credit Con¬
of the American Bankers Assn., Chicago, 111., Dec. 14, 1950.

Association

unstable

this point.

address

ference

anxieties

—

not propose to traverse the
disastrous road by which we reached

Continued

final

the

have arrived and at times revise

de¬

antithesis

the
dear

I appraise

However, to find our national path
we must constantly reexamine where

government—but by their
with
certain
inalienable

philosophy
that

can

endowed by

are

rights including life, liberty, and the
pursuit of happiness, and that to se¬
cure
these rights, governments are
instituted
among
men.
The other

*An

individual.

Independence

men

And I speak tonight under
American for the nation's sons
who are fighting and dying on a mis¬
sion of peace and for the honor of
our country.
No appraisal of the world situation
every

(not by any man or
group of men at-the moment in con¬

be faced and the about

Continued

of,

of requests that

bility.

Creator

their

by which we
equally ob¬
vious lack of sound leadership by the powers
that be, render it imperative that the thoughtful
elements in the population make sure that they
are
thinking straight on this somewhat elusive
to

the

Declaration

clares that all

The obvious financial difficulties
soon

I have received hundreds

the present situation and give my conclusions as to our
national policies. I speak with a deep sense of responsi¬

Today, on the international scene the stakes which
being played for are tremendous. They involve the
preservation or the loss of the most precious heritage
which men have
striven for through the centuries.
Civilization
and
humanity are at
stake.
The basic issues are simple,
and
the
major lines are
clearly
drawn. The whole American system
and way of life are predicated upon
the recognition of the dignity and the

This state of affairs and this outlook

are

Holding UN have been defeated in Korea, and Continen¬
tal Europe, even with U. S. aid, has not yet developed
unity necessary for its own defense, Mr* Hoover, warning
against appeasement, advocates arming only our own air
and naval forces to teeth. Says Japan should be given
independence and arms, and recommends our expendi¬
tures be greatly reduced, the budget balanced, and nation
freed from inflation. Says prime defense of Western
Europe rests with those nations and not on U. S. Sees
no reason for hysteria.

President, American Bankers Association,
President, Security-First National Bank, Los Angeles

is not now present or foresee¬
substantial part of our labor and
capital will be devoted to rearmament and what

able,

Former President of the United States

By JAMES E. SHELTON*

our rearma¬

ahead
practical purposes to have been
determined.
How rapidly we shall succeed in
diverting our materials and our manpower to
this purpose remains, of course, to be determined
by events, but unless some factor enters the
for

Copy

National Crisis Policies

Synthetic Prosperity

ment effort in the months arid even years

appears

Price 35 Cents

Planned Inflation and

As
The

York, N. Y., Thursday, December 21,1950

Monthly Commercial Letter

west point mfg. co

upon

duPont, Homsey &. Co.

Request

Bond Department

THE NATIONAL CITY BANK

THE CHASE

Members New York & Boston Stock Exch.
Free

milk street, boston 9, mass.

Tel. HAncock 6-8200

Tele. BS 424

Private Wire to New York

CAnal 6-8100

Fitchburg

Worcester

Springfield

from

Prospectus
your

may

obtained

investment

dealer

OF NEW YORK

NATIONAL BANK
Head Office: Toronto

FRANKLIN DISTRIBUTORS, Inc.
64 Wall

Street, New York 5

Bond

Dept. Teletype: NY 1-708

New York
Seattle

THE CITY OF NEW YORK

Agency: 20 Exchange PL

Portland, Ore. San Francisco Lob Angeles

We maintain active markets in

Brown

Company

(all issues)

Underwriters and

Distributors of Municipal

Canadian Superior Oil
Company of California

and

Prospectus from authorized

dealers

VANCE, SANDERS & CO.
Ill

canadian department

OTIS & CO.

Goodbody & Co.

(Incorporated)

ESTABLISHED 1891

Devonshire Street

Established

BOSTON
New York

Lot

&
Angeles

1899

MEMBERS NEW YORK

CLEVELAND

Chicago

New

England

Public Service Co.

BONDS & STOCKS

An interesting

workout situation

Steep Rock Iron Mines

Corporate Securities

CANADIAN

New York
Cincinnati

Chicago
Columbus

Denver
Toledo

! Dallas
Buffalo

(IS BROADWAY
NEW YORK

STOCK EXCH.

Doxmion Securities
6rporaxio7I
40 Exchange Place,

New York 5, N. Y.

105 W. ADAMS ST.

CHICAGO

IRA HAUPT & CO.
'

Members New York Stock Exchango
and other Principal Exchangee

111 Broadway, N.
WOrtb 4-6000

Teletype NY 1-702-3

WHitehaU 4-8161

Boston

Y, 6

Teletype NY 1-2706

Telephone: Enterprise 1820

'.V1

vt,

Chronicle

The Commercial and Financial
2

Thursday, December 21,; 1950
- •*"*

...

(2434)

TRADING MARKETS

New York Central

The

4/98

week,

A continuous forum in which, each

5/2013

New York Central

Chi. Mil. St. PI. & P.

4V2/2019A

Chi. Mil. St. PI. & P.

different

participate and give their reasons

for favoring

V''

Their

American

particular security.

they to be regarded,

intended to he, nor
offer to sell the securities discussed.)

as an

New York Hanseatic

$17.85

Co.,

Oppehheimer

Partner,

Power

Members of New York Stork Exchange

Teletype NY 1-583

BArclay 7-5660

Power

American

Light

Special situations have the ad¬

This

setbacks.

important at a
moment when

Specialists in

the

averages

reached

have
t h

Rights & Scrip

h i g h-

point in

est

Co., New York City.

Bought—Sold—Quoted
Electric

Gas and

Co.—

I. Josey
City, Okla.

Oklahoma

Co.,

(Page 2)

Steiner, Rouse & Co.
Members New York Stock Exchange

19o0, net income totalled $3,051,-

equal

322,

vantage of providing a cheap kind
of insurance in case of market

Louisiana Securities

Light—Al¬

and

H. I. Josey, Partner, H.

Power and Light. For_ the 12
months period ended Sept. 30,

Established 1920

$1.12

International Telephone and Tel-

common

per

various reports

subsidiary

this

that

Corp.

egraph

share.
There have been

be sold

may

Henry

—

Low,

Security Analyst, Bruns, Nordemaja
& Co., New York City.
U-age 65)

public authorities in the State
Washington, where public power
iias become increasingly popular,
lt is believed that this property
kxtric Company
to

may
in

too

not

Members New York Curb Exchange'

25 Broad St., New

York 4, N. Y.
NY 1-1557

HAnover 2-0700

New Orleans, La. -

Birmingham, Ala.
Mobile, Ala.

Direct wires to

our

branch offices

common stock. The
completely integrated
strategically
located
geo-

„„i j

so d,, p
distant futu

be eventually

the

Deuble, Partner, Oppen-

(Page 2)

American

per

)
•*-' \ l
L,r> '-J >'

bert H.

(The articles contained in this forum are not
are

ALBERT II. DEUBLE

York 5

Alabama &

Selections

of experts

group

Oklahoma

120 Broadway, New

and

Participants

heimer

4i/2/2044B

Corporation

Week's

This

Forum

advisory field from all sections of the country

in the investment and

4V2/2013

New York Central

Security I Like Best

'.I

jtA.i't

company

and

between $40 mil|lon. a"d $55 million. Such figures

graphically.
It enjoys excellent
reiations with the public it serves,

Bates

indicate that Washington
a
Power may have a value of be-

Management is young, intelligent

Manufacturing

curities offer-

ing a sheltered
position a fi d
providing spe-

tween $17 and $23 per American gree 0f leverage in the common
Power a:na_Lignt snare.
stock. Physical properties are relAmerican Power and Light &lso atively new and maintained to a
qtivpiv now nnri maintainor! tn

cial protection

owns

many j
years.

Since 1917

the

However,

number of se-

frfcpONNELL&rO.
Members
New

York

Exchange
Exchange

Stock

New

Curb

120

shrinking

BROADWAY, NEW YORK 5

and

Tel. REctor 2-7815

the shares

of American

and

Power

American Air Filter Co.

few

the

situations in the utility field. The

Common

and

Incorporated

Floor, Kentucky Home

1st

LOUISVILLE

Life Bldg.

KENTUCKY
Bell Telet jLS 186

American Power and

Light.

Light currently selling around 16
offers a discount of 25% to 40%
per
an

share. The stock is considered
attractive discount situation,

affording

return pending

6.2%

consummation.

Power and

very

Request
★

Teletype BS 259

N. Y. Telephone WOrth 4-5000

of the

disposed of within one year

and

Arkansas,

wholesale

nities

service

and

rural

supplies

commu¬

J. B. Maguire & Co., Inc.
Members

Nat'l

Assn.

Securities

Dealers

Ino.

75 Federal St., Boston 10, Mass.
Tele. BS 142

Tel. HUbbard 2-5500

Portland, Me.

Enterprise 2904

Hartford, Conn.

Enterprise 6800

Open End Phone to New York Canal 6-1613

cooperatives.

vaiue of $5,300,864 and
$6,626,080, respectively, may be
derived.
After
satisfying Port-

Merrimac Hat

Corp.

andk

Bond

Goulds Pumps, Inc.

land's

tion 242,450). The largest cities in
preferred stock,. American the system gained 22% in popula& Light's holdings would tl0" the Past 10 >'earsSince 194a

Power

have

value of between 25 cents

and 50 cents a share.

Light's

and

Power

working capital euusisib almost
worxing capital consists aiiuusi

t
nei

Funded

Worumbo Mfg. Co.

healthy growth, the largest city
Slf
,y (popiila-

times,

Reed Prentice

[

order, the company on Feb.

15, 1950 distributed all of its com¬
stock
holdings in Florida

™?,tomers serve<t have increased
42J« fs compared to 25% for the
industry nationally Total revenue3 '"creased 45%, and net
:eainin§s 97% in this period

Howe Scale Co.
Bought—Sold—Quoted

Ralph F. Carr & Co., Inc.
31

Major sources of income of the

and

Power and

Light,

Light, Montana Power,
capital

holders of

its

Cent. Illinois Pub. Serv.

The

Washington

nections

Partner, H. I. Josey & Co.,
Oklahoma

Power

Company, 99.9% owned by Ameri¬

Kentucky Utilities
Northwestern Pub. Serv.

Puget Sound Pr. & Lt.
Southwestern Pub. Serv.

Light/ supplies
electric light and power service in
Spokane and 180 other communi¬
ties

eastern

Primary Markets in
Over-The-Counter

Securities

and

substantial

shown

growth ' since
1840. In 1949, approximately 95%
of total operating revenues was
from

electricity

and the

remainder from water and steam
'

heat.
37 Wall Street, New York 5
WHitehall 4-2530 Teletype NY 1-3368

Washington

northern Idaho all of which have

derived

V0GELL & CO., Inc.

and

Power

can

first

consists

mortgage

of better than $16.50 is derived for
the

common

Over

vide

growth

isfactory

several

MlMtBSS

new york curb exchange

40 EXCHANGE PL., NEW YORK 5, N. Y.

Teletype NY 1-953

panies.
As

rities

those

less

in¬

The

Fuel costs

are

a new

American Marietta

sold

alternate

less than one-

Henry B. Warner & Co., Inc.
Members

123

Phila.-Balto.

South Broad

Phila. Telephone

Stock Exchange

St., Phila. 9, Pa.

Bell System Teletype

PH 771

PEnnypacker 5-2857
New York

Direct

City Tel.:

wire

generating station
Okla¬

BOwling Green 9-4818
Emerich,

Ames

Chicago

BUY

A similar unit is be¬

City.

SAVINGS

BONDS,

executives

Gas and Electric

pable

dy¬

and

Oklahoma

Company are ca¬

skilled

young

men,

under 50 years

of age for the most
part, but with long years of serv¬
ice and experience.
Sound man-

N. Q. B.

farsighted and aggressive
in
expanding facilities ^to meet
ever increasing demands for serv-

agement has fully recognized its
responsibilities to the communities served, and the importance

ice.

of fair treatment to its customers.

INDUSTRIAL STOCK INDEX

namic.

Man,

agement, b y
a
iar&e> has

proven

I like Oklahoma Gas

and ElecApprox. Value
Per Share AP

$41,939,700
40,000,000
55,000,000

$17.85

Portland Gas & Coke at 8 times earnings.-

231,060

.25

Portland Gas and Coke at 10 times

463,826

.50

earnings

The rewards have been
No

Washington Water Power at $16.50 per sh.
Washington Water Power at sale price of
Washington Water Power at sale price of

Range of values

available

The

indus¬

utility

try

coal
fuel.

370,000 kw.

and

rails.

power

Oklahoma-mined

supplies.

•

Central Public Utility 5%#

completion of this installation to¬
tal capacity of the system will be

than

dustrials

the

;

com¬

ing installed, scheduled for opera¬
tion
in
February,
1951.
Upon

secu¬

are

gas

homa

class

these

stock, equivalent to

working capital

Foote Mineral

Central Electric & Gas

of 50,000 kw. capacity near

Value

Net

Penna. Power & Light Common

Southwest.

generated
in
company - owned
steam generating stations, located
near
the center of vast natural

operation

com¬

Estimated

New row stock exchange

Pennsylvania Railroad

Philadelphia Electric Common

Recently the company placed in

operating

<$-

Shaskan & Co.

BS 328

tionally.

elec¬

utility

90%

utility

the

half of those for the industry na¬

the

one

possibilities,

select

would

tric

common

which pro¬
continuous income, with sat¬
companies

•

of $19
bonds,
35,000 shares $6 preferred and 2,541,800 shares of a no par value
common stock. Washington Water
Power presently disburses
dividends at the rate of $0.25 quarterly to American Power and Light.
If the indicated $1 annual divi¬
dend is capitalized at 6%, a value
of

Okla.

Electric Company

seeking

those

For

stocks

volatile

Capitalization

million

City,

Gas and

Oklahoma

other

lines

panies'

$6 and $5

Water

Street, Boston 9

well diversified,

area served are

to the4
Generation,
transmission
and
distribution facilities form a com¬
discount from liquidating value.
pletely integrated and intercon¬
nected system, with physical con¬
II. I. JOSEY

Minnesota

Texas Utilities and its new

Milk

Tel. HUbbard 2-6442 Teletype

regard

without

dividends

mon

Power

Corp.

workout value of American Power

preferreds and old common stock.

incorporated

company,

now

Debt entirely of cash and temporary cash
investments,
and totals
almost
,000,000, equal to $3.70 per share,
Light formerly was in We tabulate below the estimated
is

Electric

stock

Phone DIgby 4-4950

power

which
originally owned
31.15% of subject company's com¬
mon
stock and now has only a

St., Boston 9, Mass.

7-0425

for

Great
fuel are
generation.

cost

Bought—Sold—Quoted

group,

to this

CA.

Gas must be

rected that Portland

American

sim-

Light Company be terminated and
the company dissolved. Pursuant

TeL

The

low

being derived from agricultural
products, • livestock, small manuand Light, taking ir.»:o considera- facturing enterprises and the petion the various possibilities men- troleum industry.
Though Oklationed above.
homa is widely known as an "oil
small interest. The SEC, on Aug.
The risks of the situation appear state" over 90% of the company's
22, 1942, directed that the exist¬ small, since current prices are revenues is derived from sources
ence of the American Power and
amply supported by earnings and other than the petroleum industry.,

SIMPLEX PAPER

148 State

2,342,411 common
outstanding. American

the

★

quantities
available

the

ahead

CONTROL

★

capitalization

There

pie:

U. S. THERMO

plant

high degree of efficiency.

Portland, Ore., and four propane- 1902, distributes electricity to 228
butane plants in Oregon and Van¬ communities in Oklahoma and
couver, B. C.
The SEC has di¬ Western

......

The

Analyses

This company owns

manufacturing

gas

Gas

de-

BANKERS BOND °°

Long Distance 238-9

and Coke Co.

Portland

are

Stock

Common

stock

There

consummation of that company's Although the comnanv retains the
Wafpr rower Comnanv
recapitalization plan, now before /vunou4Sf1l ™ company retains tne
water Pnwpr company, the chief
tne cniei
*
arimmfmtc
name "Oklahoma Gas and Electric
remaining asset, may very soon the SEC
Ural arguments ai e now
Danv» because it is so well
hp
cnlH
tn nuhlir
authorities or
being held before the SEC.
j J
oecause u is so wen
P,
?
? .p ? l .autnormes or,
p
rennrteri npf income of and favorably known, its revenues
if not, distributed to stockholders.
J; Gotland rfP-01Ja net income or
derived entirely from the sale
Thp valuation
of tnis suosiaiary
subsidiary $662,608 for the 12 months'period are aerivea entirely nom tne sale
Ine
valuation
ot this
*
.
If these earn- of electricity.
It serves a ternwill largely determine the liquid- enaea &ept. so, iyou. ii tnese earn
which consistently eniovs a
atin? value
Ampriran
mgs are evaluated at 8 and 10
eonsistentiy enjoys a
V3lue of Amerlcan Power
01

Dobbs-Houses Inc.

™

outstanding

of the

100%

aggressjve

and

Washington
wasningion

of
oi

stock
stock

common

Churchill-Downs Inc.
Capital

Light we find one of
remaining
liquidating

common

more.

Deuble

Albert

Prices

17.00
23.00

3.70
8,463,008
$20.95 to $27.20

generous.

property operated by the com¬

pany

has been acquired by a mu¬

nicipality.
During the past five
years it has been granted fran¬
chise renewals, for periods of 25
years,

communities.

The

astounding record shows that 98%
of

those

voting

the proposals

Continued

page

OVER-THE-COUNTER

11-Year Performance of
35 Industrial Stocks
t

BOOKLET

REQUEST

National Quotation Bureau
Incorporated

46 Front Street

New

York4,N.Y.

Volume 172

Number 4970

The Commercial and Financial Chronicle

(2435)

Television: Its Investment Aspects

INDEX

By ROSS D. SIRAGUSA*
President and

Board

tainty due to

multi-

Planned Inflation

good.

and

Cover

Synthetic Prosperity

Television:

COME SEE
Cover

Its Investment Aspects—Ross D. Siragusa

SANTA CLAUS

Inflation and the Banking System—Thomas B. McCabe______

AND COMPANY

—James E. Shelton

but holds long-term out¬

rearmament program,

look for television expansion is

Page

National Crisis Policies—Herber Hoover

billion dollar business TV executive
contends, saturation point
is far from being reached.
Foresees some immediate uncer¬

AT 99 WALL STREET

spirit of goodwill to all inves¬

tors,

Television is the youngest big
industry
we
have
today.
Its

growth has

within five years and
be within 10 years.

Stock Market Twists—Past and
Present—Roger W. Babson

been

meteoric.

From

laboratory curiosity before the

grown

it has
in the

five

years

war,

since
into

that

dollar

produc¬
sets

public
surely will

How

has

which

today,

A Formula for

receivers

much

are

ford

receiver

new

way

used

three

years

owners

just

one

—Ernest

buy a
automobile

do.

two

over

TV,

bil¬

for

almost

trend

Siragusa

explosive

boom aura about

servative

many

ago,

there is something unsound about

be offered the

has

something

with

products other than food, clothing
shelter

and

have.

ever

Here

the

within

nation,

million

stations.

these

have

sets

Long

the

19-

before

the

answer

between

this, market thus far, 7 million of
this

year.

Al¬

the

slightly more than two-thirds of
the family groups in the areas
now
being served with telecasts
still

don't

York

have

sets.

the

arguments

As you

tember while

about

wave

the

decided

opening

what

word

the

mid-1951. If it does, and if we do
not

get into

♦From

before

the

Chicago,

total

address

Investment

war,

other

most

prospects are subject
uncertainties because of

all

its

own

the

The FIIA and Housing Situation—Franklin D. Richards
'•

•

indications

Mr. Siragusa
Analysts Club of

equipment is highly
are

that

Leon

Keyserling

Contains

Paul

Urges

Higher Interest

See

&11 ©cntd
fctftishcs for

I
I

Regular Features
As We

mid

Curb

1951

Jt (Editorial)-,

.—Cover

-r

Bank and Insurance Stocks

I Moreland & Co.

Business Man's Bookshelf

Midwest Stock Exchange

Detroit Stock Exchange

Members:

Canadian Securities

Coming Events in the Investment Field

Dealer-Broker Investment Recommendations

1051 Penobscot Building

$
?

Einzig—"Britain's Raw Materials Shortage"

DETROIT 26, MICH.
Bay City

—

Lansing

—

Muskegon "

From Washington Ahead of the News—Carlisle Bargeron

Indications of Business Activity
Mutual Funds

BUY

36
14

directly engaged in military
production within the next 6 to 12
months. Had it not been for

Continued

1950.

Observations—A. Wilfred May
Our

SAVINGS

Reporter's Report

Prospective Security Offerings
Public Utility

Securities

Railroad Securities

war

page

offerings of

—

OWNS

Securities Now in Registration

Trading market

Tomorrow's Markets

Teletype—NY

Glens Falls

1-5
-

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maintained
on

request

Iohn R. Lewis, Inc.
1006 SECOND AVENUE
SEATTLE

*Not available this

week.

ELlot 3040

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38
Twice

Weekly

Drapers'

c/o

Gardens, London,
Edwards & Smith.

C.,

Eng¬

and

COMMERCIAL

CHRONICLE

hiatter Febru¬

second-class

Air Products

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

Corp.

ary

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COMPANY,

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RIGGS,

Publisher

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Thursday, December 21, 1950

vertising

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9576

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(Walter Whyte Says)

Washington and You

Every
Hubbard

Analysis

The State of Trade and Industry

REctor

50 Congress Street, Boston 8

PRODUCING

OIL—LEAD—ZINC—GOLD

Best

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and

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per

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per

year;

per

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FINANCIAL

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Limited

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WILLIAM

25 Broad Street, New York 4

BONDS

Our Reporter on Governments

HERBERT D. SEIBERT, Editor &

Rates

JUm'v? ©livistimts

McCracken

Inflation

|
i

Periodic Payment Plans

of Mutual Funds__

of Jumbling of His Figures

William I. Johnston States Views

preferred stocks

Chicago

Exchange PL, N.Y. 5

Statistical

President Truman Announces Defense Plans

Reg. U. S. Patent Office

Teletype NY 1-1825 & NY 1-1826

•

than

High Grade Public Utility and Industrial

Albany

HA-2-0270

Association Meeting

land,

Stock Market to Be Discussed at American

Published

HAnover

❖

The

Members New

prob¬

matter of

25% of the industry's capacity will

We are interested in

Singer, Bean
MACKIE, Inc.

Have New Leadership or Trust in God, Alone!—John H. Crider 27

indus¬

important in rearmament. Present

I expect

III., Dec. 20,

Chicago,

Electronic

Commission

hopes to have the freeze lifted by

I do about the long-term

color, which I shall discuss after
dealing with the war situation.

lengths to TV. According to

latest

feel

today, the TV manufacturers'

many

lem

additional

could

casting, the industry has

the FCC froze the

that

the rearmament program. To fur¬
ther complicate short-term fore¬

doubt know,
licensing of new
stations two years ago last Sep¬
do

wish

near-term

stations

will pretty well blanket the parts
of the Country now without tele¬
casts.

outlook.
tries

Commission.

these

only

confident about the immediate

future

for additional sta¬
pending before the Federal
authorized,

—Stanley M. Wedd

Canada and the War Crisis—Robert Rae

News About Banks and Bankers

applications

When

•

Economy Faces War Conditions

NSTA Notes

today more than 300

Communications

;

Cement Co.

Uncertainty of Immediate Outlook

tions

Canada's Expanding

the product is concerned.

highest

50%.
are

next five to

the

over

to qualify TV as an in¬

dustry meriting investment rating
so far as prospective demand for

percentage of families have re¬
ceivers, saturation Is still only

! There

market

ten years

In the New

where

region,

Giant Portland
11

youngsters

and

parents

which

generation will dic¬
tate program selection. This, again,
lowing for non-family purchasers,
is in the pattern of radio. I think
more than 9 million families now
I have gone into enough detail on
have receivers. This means that

which/were sold

McGinn is

decade

already evidence that multiple set
ownership is being decided upon

sold

for

receivers in their homes. There is

been

required

Copper & Steel, Inc.

larger

has passed you will also see many
families with
two
or
more
TV

live

one

Some

those

much

not

—Patrick

Mfg. Co.

Continental

inch round tube today.

families

40-mile radius of

million

cabinets

than

quick sketch of the market situa¬
tion.
At
present,
telecasts
are
being made by 107 stations in 63
cities.

will give
approximately 19

area

Corp.

The

standard.

Scientific development of the 30inch tube will make this possible

few

very

the

by 25 inches, or twice the area of
19-inch circular tube.

universal market among American

families,

now

the present

almost

will

picture

public since the auto¬
mobile. It is my opinion that time
TV

from

years

30-inch rectangular tube

American

prove

are

coming. Five

tubes

lieve, is that television is the most

will

and sets

I expect 27 to 30 inch rectangular

correct appraisal, I be¬

wanted product to

the 16 and 17 inch

are

being made
to 20 inches. Still larger sizes

are

■;

now

screens,

TV.

today. The big

obsolete

are

sellers

con¬

into thinking

people

has
de->

Bates

Keep U. S. the Arsenal' of Hope!—Henry Ford II

sets and the

larger screens
created replacement

mand. Seven and ten inch screens,
which were standard two years

the

growth,

misleads

which

this

any¬

F. H. McGraw & Co.

Jellinek

also have

will

toward

already
Because

year,

industry has
it

Ross D.

receivers
this

radio,

The improvement in

lion dollars

alone

substantial replacement market.

obsolete.

STREET, NEW YORK

Skiatron

Railroad Problems, Management and Securities
...

ago, the pub¬
lic will spend

WALL

Democracy, Inflation and the Stock Market Outlook

will

as many

Program for Defense Economy—Murray Shields

Wage-Price Controls—A. L. Gitlow

lies who will feel they cannot af¬

was

getting

cash

with

Telephone: WHitehall 4-6551

This Peculiar Emergency—W.
Randolph Burgess

result will be that those few fami¬

under

Jenkins

offered in entertainment. The

ever

showering

comes

Obsolete Securities Dept.
99

Computing Excess Profits—Philip Cortney

is
A

Europe—JosephF. Dorsey_

we're
who

one

Excess Profits Tax Adversely Affects Low-Incomes

Shareholders—H. P.

costly than radios, of course. But
they also give the greatest value

tion of receiv¬

ing

radio

Although

just

American

95%.

business.
mass

the

Within that time I expect tele¬

multi-

billion

vision almost to equal the satura¬
tion
among
American
families

1945,

90%

Middle East Oil—The Lifeblood of

that TV service will be available

LicHTtnsTiir

B. S.

Articles and News

Chairman, Admiral Corporation

Despite meteoric advance of television industry into

Bank and Quotation Record — Monthly,
$30.00 per year. (Foreign postage extra.)
Note—On

the

rate

account

the

fluctuations

exchange, remittances for for¬
eign subscriptions and advertisements must
be made in

New York

funds.

THEODORE YOUNG & CO.
40

Exchange Place, New York 5, N. Y.

WHitehall 4-2250

Teletype NY 1-3236

The Commercial and Financial Chronicle
4

Thursday, December 21, 1950

...

(2436)

might pression that I am singling out the set of tax increases has been en¬
seasonal banking system for criticism. I acted, but others are necessary.
Certain national and state pro¬
appreciate that you are part of a
larger financial community which jects will have to be postponed.

much less ip early 1950 than

Inflation and the Banking System
^

By THOMAS B.
Chairman,

grounds.

McCABE *

bankers to meet their share of responsi¬

bility by carefully restricting and scrutinizing loans and invest¬
Cites increases in inventory loans and consumer credit

ments.

inflationary

Lists counter-inflationary measures

menace.

already taken, and warns more drastic moves to

restrain credit

by Individual and collective action of banks is
Says, however, legitimate credit requirements for

expansion
needed.

defense orders should be fully met.

deterioration

our

made

has

position

must

Inflation

curbed. The their lending operations with great
international cafe during this period of intensi¬

problem

the

difficult. It is more compel¬

ling than ever
that we work

infla¬

tion. It should
be

program

pref era b 1 y
a
mini¬

with

mum

com¬

pulsion. This is
the more dem¬

ocratic way.

will require
the

backing

and

initiative
McCabe

Thomas

of each of you

because

here,

appeal for the voluntary
cooperation of every financial in¬
stitution in the country to help in

this battle cannot be won

in Wash¬

ington alone. It must be

fought at

the grass
As you

roots.
know, several concrete
steps have been taken to stimulate
voluntary efforts to curb credit
expansion. You led the way with
the joint statements made by your
former President and
leaders of

17,

People

ance.

14,

1950.

;>■-

TRADING MARKETS

this.

UNUSTED

must realize

conditions

has

;.sr. ■

bearing

inflation. At
Trnt."

full

and

bank

goods

time when there is

materials

are

higher
.

adds

Instead

the

•

ness,

Broadway

ities

This

| Telephone WOrth 4-2300

'the

Banks have

time

participated heavily

other

lenders

labor bosses in United States.
when

Perhaps
excited
be

well

There

is so
it might
past history.

everyone

is true today,

look

been

other

times

when

certainly have
the

were

the past five months;
growth thus far this year
amounted to around $2 billion-.
in

billion

W is

being effective in curbing the

the

marked, by

total

consumer

credit

Bank

instalment

directly

supply, that is the
bank deposits and cur-^

money

rency'. When banks increase

loans

secur¬

Piqanoiai., institution1

participated

widely

sive; this feeds the fires of

Boston—Philadelphia—Hartford

in financin
ownership o

of durable goods.

came

scare

were

liked their pay

e re

stock

four

first

The

w a s

scare

1914 when the

York

New

Stock

SOme months,
and investors

the

rhyme
Stock

opened

Market

again the Industrial Averages rose
many
stocks rose
Stocks continued high

while

113%,
much

more.

for. about

two

unemployment

general

to
merchandise

suddenly

merchants
for

orders

which resulted in factories laying
off

help. Contrary to all ex¬

pectations, this unemployment was
of short duration,
and the stock
market
From

again

1942

climb.

began

1946 the Industrial

Averages rose about

130%.

Where We Stand Today

■

;
The country today
of a prosperity area.

is at a peak
To be exact,

37% above the
over' securities riormal compared with 38% below
or reason.
Yet, the normal in 1933. Our normal is

throwing

after

envelope, and did
jobs. This

chang e was
closed for

without

the

not want to leave^their

market panics.

were

when

due to fear of un¬

over,

years.

1921,

The second scare came in

about

by an urtpreee-r
dented sudden decline in whole¬
brought

—a

market, followed by

stock

the

closing of thousands of banks
situation which had never be¬
happened. Yet, faith was re¬

fore

the -Industrial
Averages increased about 370%;
while then again, other stocks did
established,

and

better.1

even

and

was

caused by the Roose¬

velt Administration

put

•

.in 1937,

The fourth break came

attempting to

planned economy on United
It

business.

States

was

first
been .at¬
the

infla¬

followed, accompanied by unem¬

prices,
lasted

Money Supply Increase
the

end

of June, -the money

supply "was close to the highest
level ever reached. Since June, it
has grown by;

general

and
when

Allies gave our
war

1940,

orders.

course,

during

1942 the market

downward

war,

England and the
corporations large

1941, and

fluctuated

state

commodity
fear. This

until the war broke out

Europe
"

declining

ployment,

reaching

with

the

the <:low

riding

are

based upon the average

of the full

cycle. How long the present pros¬
perity will last, no one knows.
During the next few years our
fate depends
upon
whether the
advisors

his

and

President

say

the should say

"Yes" when

steadying factor, as well as

growth of Investment Trusts.
The two factors which could cause
the

acts of the
Kremlin,
and the acts of the Labor Bosses
of the United States. The next

collapse

Political

the

are

Bosses

the

depression will be brought on by
one of these two groups.
It will
come
about some day, and wise
are

those who now have a reason¬

able

amount

prepare.

for

liquid

funds to

The

point7 of

same.

this week's column, however,
show that Ave -came out of

previous
will

troubles

come

out

okay,

our

is'Jto

all our:

and

present

troubles okay if we

will keep out

God's. Teach¬

and

of debt

ings.

Morgan Stanley to Admit
On

Jan.

Chester

will be admitted to

point in 1942: When the war out- ;Morgan

i lopk ehapged for the better in
As a the dollar is to be maintained."
ffesult business* borrowing 'declined •- -r' dd tiofwrsh-to leave the'im-' 1942, the market began to pick up

.-"consumers

last

was

employment. Everybody had gone
to work during the war days; they

American

we a

tion.

about $4 billion to a
new
peak of nearly $173 billion.
homes, the expansion ot.busines
inventories, and the purchase by Jt must be stopped if the value of

rthe^construction and

The
war

•

and the

by almost another billion.
general expansion of credi^

.«sit$a|ian.

about 130%.

even

Roger W. Babson

went

and the Industrial Averages

people

1950—that is,
a

stock market
Kremlin and of

cause

can

''Yes"
and isay "No" when they- should
financing a marked expansion iri
sale commodity prices. This sent say "No."
consumer
buying,
especially
I sincerely hope they
through the extension of instal¬ many concerns into bankruptcy. get on their - knees and ask the
ment credit. After June consumer Yet, it was only a question of re¬ guidance
of God when making
instalment credit increased very adjustment, after which employ¬ these tremendous decisions.
ment increased and the Industrial ;
rapidly. The expansion in the third
We need have no fear of the
quarter was more than half again Averages climbed nearly 500%, things which have
brought on
while
certain stocks did much previous depressions." These have
as large as in the same period of
better.
\
•' - - been remedied. Also, the Stock
1949.
J '
Consumer loans by commercial
have
been
The third scare came in 1929 Exchange - margins
banks have increased by about $1
greatly increased, which should
due to the extreme overexpansion
and

ibanks

growth
employed at" credit.

i^art frqm, an accelerated business

August and have declined only
slightly since then. For the first
ten months of the year the total
of such loans
has exceeded the
annual rate of any previous year.

contributed to and also resulted ill

0irect Private XV tires to Boston,
Philadelphia, Hartford, ' V
1 i
Providence & Portland, Me. *

-it

new

available

holdings of state and local

Jersey City—Portland, Me.—Providence

all

1914, and

of the things which have

now

acts of political bosses in

are

property
peak
in

governmental volume of deposits" is likely to in¬
expanded by crease by a corresponding amount;
billion dollars and bank When demand is already exces-»

Bank

about $2

now,

credit. New loans

residential

personal and

credit.

Teletype NY 1-40

fear

their time this had., ever
j credit, including mortgage, busi¬ total loans and investments, the tempted; a ^severe market "break

INCORPORATED

Bell

sustained demand for all kinds of

J. Arthur Warmer & Co.

N. Y.

reached

wages.

before -Korea—was

120

being

break

large factor in the recent expan¬

sold at higher prices and

The first part of

i i

New York 5,

are

dollar

the available labor is

Los Angeles
•

credit

expansion.

Morgan & Co.

HSiembers'Los Angeles Stock Exchange
i

raw

our¬

that vye

previous depressions, since these have been reme¬

mortgage

competition for limited supplies of has
goods and services. As a result, Fortunately, it may be coming to
prices and 'wages are bid up. No an end following the usual sea¬
more goods are produced or hours
sonal peak at Christmas. All of the
worked as a result of the credit evidence indicates that Regulation

Paul H. Davis & Co.

Chicago

make

the problem of

sold and used, every dollar

'Members.New York Stock Exchange

*■'

lending

employment, full use of plants
machinery, and also when all

available
,

'
-

that under

every

and investment decision

SECURITIES
Direct Private Wires to

must rec¬

overall bank lending and

present

Says only two factors which

of
activity in home building has been

ognize the inflationary potential of
investing
in an emergency period such as

IN OVER 400

need have

nancing. An unprecedented rate

to a privileged few.
development
of new

brought
died.

instalment debt fi¬

and consumer

money

ing community that

contends

cancel

indirectly, home

providers of essential services to in this type of financing. Real
all of the people. Banks are com¬ estate loans outstanding at com¬
ing more and more to be regarded mercial banks have increased since
June by $1 billion. The total ex¬
as genuine community centers for
pansion this year is about double
personal financial affairs.
It is particularly because of the that amount.
Even before the Korean crisis,
increased public trust in the bank¬

Mr. Babson recalls four stock market cycles since

caused

ly or

call,. the
52 bank
supervisory With the
agencies in the United States also checking facilities, consumer loan
issued a joint statement that urged departments, and
other services
financial
institutions
to
screen for persons with small incomes,
iU
bankers are being recognized as

Dec.

prepare

less

—Past and Present

fear

of private

McCabe before the
of the Ameri¬
Association, 'Chicago, 111.,

ROGER W. BABSON

readers have

small

Bankers

ex¬

Probably most

can

have

and 50%

*An address by Mr.

will have

all

selves to do With

saying

disturbed.

sion

National Credit Conference

competitive

probably represents, either direct¬

There is iess and less feeling to¬
how quickly your organiza¬
appointed its special commit¬ day that bankers are steely-eyed
tee on voluntary action to which money bags with offices in cold
I have already referred.
marble halls, interested onl.y in

lending

What

Stock Market Twists

than

might

too,

Early in August, as you will re¬

much

been

tion

highly

environment.

mid-year, between 40%

and reassur¬

now

remember, community.

has

volume

the

for confidence

them

operates

stage

The recent increases in business
loans

think of bankers
other financial groups in mid-July as active participants in both local
cautioning their members against and national affairs, generous with
the use of bank credit to stimulate their time for the welfare of the
inflationary trends.

the

was

Chairman of the
Federal Reserve Board, I address¬ pected on purely seasonal grounds.
The lion's share of the increase
ed a letter to all member banks
has been for the purpose of carry¬
in which I pointed out the un¬
ing additional inventories. About
precedented rise in bank loans
60% of the increase can be attrib¬
since the middle of the year. I
uted to borrowing of commodity
emphasized that the continuation
dealers and processors of agricul¬
of such a trend -would not only
tural commidities. It has both re¬
add to inflationary pressures but
flected and accentuated the sharp
would
seriously
handicap
the
rise in commodity prices that has
necessary
expansion of military
taken place.
•
production. I appealed again to
An additional 30% went to sales
all banks to do their part in re¬
stricting
the
credit
expansion. finance companies and distributors
Similar
appeals have gone out in about equal amounts. The re¬
from other supervisory agencies.
maining 10%
went to a wide
Banks today have a more re¬ variety of business borrowers. It
is notable that thus far an insig¬
sponsible role to play than ever
nificant amount has been required
before in their history. They stand
to finance defense contracts.
in higher repute throughout the
Of the $7 billion increase in total
country today than ever before.
More
and more people look to loans of commercial banks since
Nov.

program

curb

effort. It was a very

defense

strong

restricting unnecessary credit.
A little less than a month ago,

together to de¬
velop an effec¬
tive

fied

in June.
to
is equally applicable to may preserve the value of the
you
After Korea, credit demands bal¬
insurance companies, mutual sav¬ dollar while we are meeting our
looned. Since mid - year, in the
full military requirements. In ad¬
commercial banking field, loans ings banks, savings and loan asso¬
ciations
and
government credit dition individuals and institutions
have increased by almost $7 bil¬
with real savings must be induced
lion. They are still increasing. This agencies. But I do want to bring
home
to
you
today with great to purchase Government securities
is larger than any expansion in
emphasis that this is your problem and to hold them. The limits for
any other
period of comparable
as well as ours.
purchase of Series F and G sav¬
length. The outstanding volume
Certain
fiscal
and
monetary ings bonds have been raised. Fur¬
of such credit is now at a record
measures to cope with
the infla¬ ther campaigns will be inaugu¬
level of almost $52 billion.
rated to promote the sale of Series
tion situation have already been
Businesses have been especially
E bonds, especially through pay¬
heavy borrowers since June. Loans adopted. More are needed. We roll savings plans. Additional sales
to
business borrowers have ac¬ must tax heavily to finance the of
savings bonds are essential to
counted for more than half of the
defense effort without inflation. absorb funds that might otherwise
over-all bank loan expansion in
be spent. Thrift and savings are
We must siphon off excess pur¬
the past four months. This increase
Continued on page 29
has also been substantially greater chasing power through taxes. One
than in any comparable period.

for curbing inflation, Federal Reserve

Stressing urgent need
Chairman calls upon

Credit Expansion
This

Federal Reserve System

of Governors,

Board

expected

been

have

Stanley"

H.> Lasell

partnership in

Co., .2

Wall

;Street, New York City, members
of the New York Stock

Exchange.

Volume 172

Number 4970

The Commercial and Financial Chronicle

Slock Market to
Steel

The

Be Discussed

Output

Carloadings
Retail

State of Trade

Price

Auto

and

Trade

Industry

American

Index

Production

Business

Overall industrial production for the

that total output

Various

Petroleum

December 27.

phases

Annual

Meeting of the American

tains loss of Middle East could

also noted

rising slightly, for

people of the United States and of the world the gravity of
that confronts them by the Communist aggression

relentlessly bringing the world "to the brink of

mated.

current

its

members

partially paralyzed
"This

action

being held

railway union and

unlawful

tion of
Dec.

strike

large

slow

down

upon

the

dispute

that led

New

search.

Dec.

p.m.,

Merrill

the

Lynch,

for

tions."

"Is

Social

Mr. Hargrave

Markets

strikes last week.

School

Mr.

will speak
Rela¬

May's topic will

Possible

be,

Forecast

the

noted

belief,
Eastern

same as,

billion barrels proved in the
World, 32.5 billion have been

while

the

Middle

estimated

East,

that

the

but there does

Soviet Union and its satellites can

not

claim

seem

full

the

lion

economic

has

the most important source
troleum

tional

allies.

faces

that

ation

The

the

than

the

East

properties there.

nings

Our

all

studies

nomics have convinced
of

the

serious

most

States

for

accounts

same

compared to

eco¬

that

hazards

51.6%

the total South

American prod uction.

oil

somewhat different picture.
it
can
be
seen
that ■{ the

about the

Europe.
world

production,
while
the
Middle East
brought
only 17.3%
to
the surface, gor

al¬

political

our

Western

of the world crude oil

threat to the economic underpin¬
liances

source

recent

most

United

It involves

Here

dollars

their

comparable
production figures available indir
cate

area

development

find

barrels.

The

consider¬

millions

billion

our

Middle

the

invested

oil

of pe¬
interna¬
grave
danger

supplies for

barrels

United States, and Venezuela
crude reserves of about 9.5

the

Joseph F. Dorsey

significance of

only 4.9 billion barrels.; Jn

Western Hemisphere 25.9 bilr-r

the

com¬

prehension

Re¬

Security

Stockholder

and

about the

are

discovered

popular

slightly greater than, those in
Western Hemisphere.
Of the

Old

basis,

should

reserves

39.2

entails far

Financial

and

"Observations

crippling

luncheon session from

Commercial

the

work, heads of four railroad brotherhoods and repre¬
sentatives of the carriers were called by John R. Steelman, Presi¬
dential
Assistant, to the White House on Sunday last for
wage

Eco¬

Chronicle, and faculty member of

back at

the

and

Fenner & Beane, and A.
Wilfred May, Executive Editor of

Upon receiving word that virtually all the striking railworkers

settling

session

Pierce,

the union and

striking members to return to work immediately."

from

The speakers will be Homer P.

conferences

The

30.

ASA's Business

the

Hargrave,

danger to the security of our nation.

Chief, therefore, I call

Science

Wednesday,
27, at the Congress Hotel.

interfering with the movement of troops; it is holding up
equipment for our fighting forces; and our civilian population has
begun to suffer.
a

Social

Chicago

Dec.

12:00-4:00

"This strike is

conven¬

nomics Statistics Section, will take

industry.

our

"The Stock Market," sponsored

that has

which

part of the

Allied

the

place at

begun to

already

"As Commander in

Associations

railroad system.

our

has

crude

United

full-war

Association,

Hemisphere

geared

A. Wilfred May

Statistical

out

contrary

States is being
Homer P. Hargrave

wildcat strike of railroad switchmen,

are

that,

military

the

reserve position of this area
perhaps be seen more clearly

Table

economic

machine

reduction in nonmilitary expenditures, and stabiliza¬
tion of wages, and longer hours.

cognized.

and

"Unfortunately, at this moment

The

letely

The

products necessary to keep the cost of living down;
expansion of the Army, Navy and Air Force, with an increase in
military manpower to 3,500,000; higher taxes, far beyond any so far

Commenting upon the
President Truman stated:

international

can

c o m

proposed;

critical

crude

and

seem

general

r e

items and

were

Europe

America.

it does not yet

Drawing the people's attention to what is necessary to combat
the danger that confronts them, he called for a sharp upward
revision in our military strength and for a vast expansion in our
production efforts. To implement his program he stated he would
ask the Congress for immediate price controls on essential defense

its

loss of Western

mean

As a potential source of
oil, the Middle East cer¬
tainly should not be underesti¬

situation,

war."

A vulnerable spot in the defense
the non-Communist nations is

situation

number

Corporation

becoming increasingly evident in

claims for unemployment

weeks, continued to decline

some

Friday evening of last week the President brought home

which is

Research

political allies.

in the last recorded week.

the

Argus

the

respect to employment, total

insurance after

Economist,

Demonstrating economic dependence of Western Europe on
petroleum from Middle East, Mr. Dorsey points out necessity
for recognition of grave threat facing us in this area. Main¬

the

a year ago.

With

to the

Euope

By JOSEPH F. DORSEY

security
markets and investment practice
will
be
weighed
at
the
110th

whole held

was

Association

sharply higher than that for the correspond-

was

ing week

country

high level the past week.

Statistical

Chicago

Failures

J
nearly steady and at

Lifeblood of

Hargrave and May will address

Commodity Price Index
Food

Middle East Oil—The

Production

Electric

(2437)

production

one

Whi}e;

S., crude oil

the

Middle

East

to be relatively small, let

appears

now

the U.

non-Communist us consider the actual number of
barrels produced—1.8 million bar¬
so very few
/J- ;
people
in
responsible
positions rels per day.
It has been estimated by the
have a complete conception of the
ECA that petroleum consumption
vital
importance
of
petroleum
geopolitics.
It is
not genera Un¬ of Western Europe for the fiscal
realized that only 368 well-placed year ending June,
1951 will be
B/D
and
that
these
sticks
of
dynamite
could raise 1,014,000
countries will be forced to import
complete havoc wilh the econ¬
omies of practically all of the free
711,000 B/D of crude oil ^and
nations of the world, or that, even 433,000 B/D of refined products.:
in peace, Russian control of the
(The slight discrepancy between
Middle East oil could place Eu-i the total of 1,144,000 B/D of-im¬
faced

the

world is the fact that

Presidential

The

10:30

a.m.

executive order defining vast powers given to Charles E.

son, new

Stock

Wil-

James E. Day, President of the
Midwest Stock

than

three

hours later, the government, using its new
ordered a rollback of new automobile prices
to Dec. 1 levels, freezing them there at least until March 1.
It was
the first price ceiling imposed in the United States since the death
Less

World

OPA in

1946 and forces General

"On Jan. 1,
120

Motors, Ford,

With

the

upon

currently
build

rescpect

«•

the

critical

world

and

its

production, "Ward's Automotive Reports"
manufacturers apparently are determined \
cars as possible before government material

many

force

continue

restrict production of

cutback

month.

Material

City,

the

Carhart,

Jr.,

Funking

Sander

and

Landfield.

Both Mr. Carhart and Mr. Trieriot

shortages

have

after a sharp drop during /

been

active

individual

Wright

Brown,

oil

and

member

tary

A frantic

...

refined

attack,

source

of crude

(2) the

products,

to mili¬

area

Western

effect

resultant

our

scramble of consumers to get in as much steel as

"'possible before straitjacket government controls are^.slapped on,,
supplies continues. Nonrated buyers are scouring the markets for tonnage to care for their current needs.
Appeals for aid in obtain- ing supplies of pig iron, steel and other scarce materials are >
beginning to flood into Washington. -And conditions promise to-

that

lands

sented

the

end

1949

petroleum reserves.
than the total

Merrill

tire United
than

reserves

world
more

of. the

dayJ
loom'

fact that

prac-j

per

all1 Western Europe's' pe-;

im'"pt. prude ap& refined
It should Be understood:
the

United

enr

Table

which

II,

give the

Continued

in all North

found

viewioi the

States, and even more

the 36%

figures

Sta'es, in order]
political alliances with,
these nations,, must make certain'
that their source of -supply will;
not
be., elimina'ed through any;
Communist aggression. The data]

repre¬

This is

barrels

East,

to maintain

in these desert

nearly 42% "1 of the

Joyner has become affiliated with

Beane, Liberty Life Building. He

Middle

that

generally known; that the proven
reserves

million

one

products,

Perhaps for this reason it is not
oil

trolcurm>f(|eds must he furnished;

the international petroleum scene.

crude

Western*

Against
the
minute,
B/D of crude productior

tically

Middle East crude oil has assumed

position of great importance

from

products

Western Europe, .and con¬
sidering the need of this territory

be/ ac¬

necessary*

evaporation, etc., and

Europe.)

large.

Resources

Lynch, Pierce, 'Fenner &

refined

the

<•

losses from

can

by the relatively small exports ofc

for

It is only in the last decade

1,014,000 B/D
for
by
the

from

European allies.

Petroleum

tion

counted

40,000

the signifi¬

(3)

and

•

of the loss of this crude oil

the

and

vulnerability of the
cance

members of the Exchange.,
J.

Middle East

ports and the estimated consump¬

Com¬

The purpose of this article is to
show (1)
the importance of the

Harold

the

steel

mercy

munists!

front,.,"Steel," the weekly magazine of metal-. the Exchange; Harold W. Carhart,
working, says, with defense requirements mounting in step with
member of the Exchange; Archie
deteriorating world political conditions, the steel markets are
M. Reid, Robert A.
Haughey and
beginning to assume wartime patterns.
Diversion of tonnage to Edward J. Stray, general partners
military and related consumption already is resulting in manu- '
in the.-firm,, will become limited
facturing dislocations which promise to intensify as the weeks
pass.
The steel distribution pattern in the first quarter of next
partners on Jan., 1. -. ; •;
year will differ noticeably from that prevailing in the period now
.<ending. And really material changes are indicated for the second
:
Joins Merrill Lynch
quarter, not only in the. character of the demand load on the steel
(Special to The Financial Chronicle)
mills, but in the manner in which tonnage is channeled into con^ sumption as well.
'
;
••
Y
CHARLOTTE, N. C.—Archie B.
On

the

rope

Exchange, will admit to partner¬

Charles H. Trieriot, Jr., Henry B.

Ford passengers cars, but the

company's truck dtitput is again rising
model changeover, the agency added.

York

ship

effect

automotive
that

states

restrictions

situation

New

members of the New York Stock

>•

•

Carlisle & Jacquelin,

Broadway,

Chrysler and Nash to abandon price increases they announced on
1951 models.

Exchange, will be

Carlisle & Jacquelin Admit

powers,

War

Market?".,

chairman of the meeting.

Director of Defense Mobilization.

emergency

proclamation, declaring a National Emer¬
in a simple ceremony at.
Sunday morning, was followed within minutes by

and signed in the White House

gency

page

irn-i

3Z,

worsen.

formerly, with Thomas Darst

was

Co..

Progressively from here on as manufacturers get closer

,'.to .the bottom of inventories, less and less steel will be available
for civilian goods production with additional government allocar-

We Are Pleased To Announce The

•;Trading Markets In

in the offing.
Only minor relief for supply diffi- ;
is offered in the premium conversion and gray markets,

A Direct

tion programs
culties

„

"and relatively little dependence is placed

by consumers

im-

Bassett Furniture Industries

] ported material.

HERBERT H. BLIZZARD & CO.

Camp Manufacturing
Steel Output

Scheduled to Show Fractional Decline

American Furniture

Installation Of

Private-Telephone]To,^ f

Philadelphia

;

Commonwealth Natural Gas

This Week

Dan River Mills
|This week steel consumers are being informed of drastic
.'cutbacks in their February'allotments of steel, according to "The
Iron

metalworking weekly.

Age,".Rational

The

cutbacks

strip.' Compared with allotments of last October^ February

."Tl

Continued

if-:

J. F.

vary

page

widely for differept products and different companies.
Deepest -'
1 slashes aie'ifi quotas for flat-rolled products such as plates, sheets and

Life Insurance Co. of Va.

STRADER,TAYLOR&C0., Inc.
.

31 1

LD.3*

Lynchburg, Va. '1
U.Y.i

'.v

•

M •

Reilly! & Co.

fVyV'A

'li! '! fit!
••r
■
'.»y• i
.

—

Broadway

•>;

*«; jv

Incorporated
)

f-,

: "

»a.-. ?

-s

...

New York-6,

if that tax were abolished
of corporate earnings
included in the base for the

This

then the
contribution to the revenue from

ings

tax,

How Excess Pioiits Tax

Adversely

and

were

Affects Low-Income Shareholders

low income

makes no attempt to explain why

profits taxation
have somehow neglected to men-

the advocates of an excess profits
tax are silent on this interesting
point; we are here concerned only
with the fact of the shifting of
the tax load resulting from this

tion

excess

the

one

most

interesting

effects of that
kind

tax-

levy.

I
,.1

They
strangely

are

silent
the

about

fact

the

fT;

kind of taxation,
The

U
1)
i
|j| flfN '
'
Vjy /J$j

that

corpora-

Table 1 shows the initial situation,
with the maximum 1950 corpora-

tion

excess

profits
must

tax

tion

;

inevi-

•

hit

tably

}

hits

the

sSM

those

mm'gS

tax

be made

perfectly

between

corporations

come

the

could

equitable

contribute

different

each

shareholder

the

rate schedule of the individual in-

H. P. B. Jenkins

even

assuming that
the

taxation, the three

earnings, depending on the posi-

mm'fimtion

upper-

in effect,
corporation

revenue out of each
°f their $100 shares of corporate

income bracke

rate

Jffy amounts of

than

tax

combined

shareholders

the

and individual

■

lower-income

harder

income

Under

the

different

and

entirely

tax. Thus A's contribution to

from each $100 share

revenue

earnings is $50, B's
is $60, and C's is $67.50. It is in¬
teresting to notice in passing that,

free

corporate

from any of the other well-known
harmful
consequences
of excess

if each shareholder

profits

subject to the corporation income

taxation.

Table 1:

This

received
not

Initial Situation; Double Taxation of Corporation Earnings,
With 1950 Corporation Income Tax.

(1) Shareholders
(2)

had

his income from investments

analysis

______________

Shares in the corporation's earnings-___

(3) Corporation

income

tax,
;j

rate of 45%________

individual

(7) Individual income

;___

income

taxes

paid

earnings
(9) Effective combined

$100

$45
,

30
25

60%

90%

divi¬
$22.50

$50
rates of taxation

$60

$67.50

50%

60%

tax,

rate of 60%____

Retained earnings
(5) Dividends paid out___.

•

$100

effective

67.5%

38.03%

$100

(7) Individual income

taxes

paid

(8)

Total

(9)

?5Jni?jes
Effective

taxation

Table 3:

income

E?1? -0f 60%

$65

$75

tax,

90%

$22.50

$82.50

+15%

$100

effective

$60
30

(6) Rates

of individual income taxes
shareholders' personal incomes—

$60

20%

earnings

these

earnings
(11) Item (9), Table
Table 1

$66

$69

$62
rates of taxation

shares of corporate earnings._________
(10) Percentages of total revenue ($197.00)

}

corporate

—

(9) Effective combined

paid

90%

divi¬

dends received

(8) Total taxation

60%

paid

minus

62%

tries

desire

see

its

occurrence

fact.

Computing
CORTNEY*

Cortney pointing out postwar conditions of different indus¬
vary, proposes, as a corrective and equalizer, excess

profits tax be calculated
and all

profits in

this national

increase of profits of all

on average

compared with 1936-39,
of latter period, when multiplied by
be considered as excess profits and

corporations from 1946 to 1949

excess

average,

taxed

66%

69%

3350% 3503%

+12%

+1.5%

derived

they

relative

the

of income

other

from

propor¬

the

believe
it

that

two points

are

profits tax

excess

can

all

bad

such.

these

three

$177.50
in

Table
Of

A's. share

Shareholder

C's

percentage

would

extract

from

shareholders

tracted from them

least

pos¬

to correct distortions due to

make

definite

have had a good

profits

semi-depressed

depressed

condition.

Varies

reasoning is
if

all

were

industries have

our

market

General Mo¬

seller's

tors

Philip Cortney

buyer's

ended some

Ever since the war

cor¬

porations

Industries

Position

Profits

cussed the line

which

and

market.
in

in a

been

some

industries

The

market

seller's

Steel

tax

amazing how few economists and

were

government officials have realized

backlog of demand inherited from
the war, and were spurred be¬

would
under

be
a

ex¬

lower

lower-income

the

du Pont de Nemours. It is

far that

result of the Woria

as a

War II the conditions of economic

1946.

But you

will find that many
of
small
or

corporations

medium size have had

gle

their

hands

real strug¬

ever

since

by easy money policy and
instalment credit. I have in mind

mainly industries making automo¬
biles,

and

durable

many

the other hand, many
industries had no backlog of de¬
mand at all, and some filled the
On

backlog within one or two years.
Besides, and above all, the costs
of these industries which were in

1946, and that their profit picture

parity in the good or bad fortunes
of many corporations cannot be

labor

at $39 per
earnings. This
the excess profits

homes

goods.

has been anything but enviable. I
submit that the reason for the dis¬

continued

sides

additional

the

were

mainly those which had huge

corporation income tax being paid
of dividends, with retained

out

earnings

explain

relatively

shareholders, as the earnings
the corporation increased.
shows

and

1946,

clear and
why, ever

con¬

the relative shares of the total tax

ideas

since

Let

circumstances.

abnormal

particularly
prosperous,
and a
much larger number who were in

income tax. And the activity and competition have been
more highly progressive the cor¬
very
unequal between different
poration excess profits tax, the industries. Many corporations have
greater would be this shifting of shown
huge
profits ever since
towards

be exercised

should

influence
as

number of companies which were

corporation

lload

its
so

lower-income

the

than

interven¬

total

percentage

revenue

however,, that

government

taxes is dis¬

tribution, however, dropped from
38.03% in Table 1 to 37.08% in
Table 2. Thus the excess profits
larger

man¬

excess

corporate earnings contrib¬
29.21%
2.

should

It strikes

uted 28.17% in Table 1 and

Table

when

the question of

1 and,
those

government interven¬

sqbmit,

that each time

$100 shares of

Table

sible harm.

corporate earnings, the total reve¬
was

tion in business cannot be avoided

such

drafted

the

tion.
and

ner

overall

of income taxation
for all shareholders. For instance,

form of

such

progressivity

business, and taxation

vention

second,

and

tax

cor¬

first,

agree:

have

would

the

reduction

taxation

which I

that

from in¬

of this rise

income

poration

regarding

tax;

and
nevertheless'

sources,

net effect

the

buyer's market were constantly

pushed upward mainly because of
contracts

tween

into

entered

be¬

labor unions and big
ascribed only to special ability of companies manufacturing automo¬
adjustment to
tax
would,
of
course,
create the management of some corpora¬ biles and durable goods. The com¬
trouble between the corporation tions. I do not wish to minimize panies which were in a seller's
and
both
actual
and
potential the ability of some men, but I wish market and those in a quasishareholders; but that is another to make clear why some com¬
monopolistic position were able
point which cannot be discussed panies have had a relatively easy
to pass to the consumer the in¬
here.
time and why others, for reasons
of

corporate

In Table

3, out of a total reve¬

$197.00

from

these

three

which

those

tributed $62, B's

earnings

con¬

$66, and C's $69.

are

not of their

ing, have had really
I

$100 shares in corporate earnings,
A's

(9),

insofar

There

different

the

vestments in corporate stock,

nue

31A7%
Item

differently

income

income-brackets,

corporate

_____

tax

ing of the tax load nor expressed

PHILIP

increase

total

$100

taxes

Mr.

gone

Although in real
would af¬

rates.
flat

Table

?60
30

(7) Individual income

shareholders

tax

$100

—

Retained earnings

(5) Dividends paid out

/n,

tax

tion

$15

(2) Shares in the corporation's earnings

profits

excess

neither explained this shift¬

President, Coty, Inc.

the

"across
the
personal in¬

15%,

increase

this

those

60%

+15%

(1) Shareholders

(4)

life

nue

Corporation Income Taxation Increased by Excess Profits
Tax, with no Change in Retained Earnings.

(3) Corporation

earnings have

flat

board,"

$222.50

corporation

Excess Profits
By

percentage" points. Hence
this change is in the same direc¬
tion as that which would result

corporate
—

highly desirable in our present

have

sharper shift of relative

A Formula for

divi-

combined rates of taxation

much

rates

their

corporation's

out

20%

-7

lower-in¬

towards

shareholders may appear to

situation. But the advocates of the

in Table 2. It would also result in

that

means

combined

effective

shares of corporate
earnings
65%
75%
82.5%
(10) Percentages of total revenue ($222.50)
paid by these shares of corporate
earnings
29.21% 33.71% 37.08%
(11) Item (9), Table 3, minus Item (9),
Table

this

(11),

Item

>$60

$5
on

excess profits tax.
points of view, such

load

tax

come

sharper reduc¬
progressivity of

B, and $82.50 for C. As shown

receiYed

in¬

■

shifting of relative shares in the

shares of the corpo¬
is $65 for A, $75

$100

totals,

of individual income taxes
shareholders' personal incomes

much

larger shares of the
upon shareholders

many

total

ration's earnings

$60

(6) Rates

From

taxation than that shown

income

2, the total contribu¬
from each of

their

reduction

load

tax

pared with

great

would

progressivity

revenue

$60

____________

(4)

Table

tion to the

tions

(2) Shares in the corporation's earnings

in¬

profits

excess

in lower-income brackets, as com¬

adjustment

Table

tion in the overall

three shareholders.

differed

28.17% 33.80%

Shareholders

income

result

point thoroughly dis¬
cussed in many other places. Here
we are concerned merely with the
shift in the tax loads borne by our

for

Corporation Income Taxation Increased by Excess Profits
Tax, with no Change in Dividends Paid Out.

(3) Corporation

corporation

illustrated

and

_____

that

extremes

fect actual effective rates of taxa¬

(10) Percentages of total revenue ($177.50)
paid by these shares of corporate

(1)

the

tax

available to the corpora¬
tion to finance its expansion; but

fact

excess

capital

come

$15

corporate

_____

Table 2;

the

adjustment

the

two

taxation and the imposition

total

was

the

regardless of
the
by any particular

of relatively

for A.

increase

dollar

would drastically re¬
the internal supply of equity

that

one-eighth

earnings

Tables

would

overall

come

All of these calculations add up

profits tax
duce

the

made

results
the

in Table

contribution

share¬

payments, the inevitable net

dend

corresponding

the

lower-income

as
between cutting
retained earnings or cutting divi¬

A's earnings con¬
to the total

C's

corporation,

the

only $1.50

earnings.
This

while

continued at
of corporate

payments
each $100

for

$25

from

20%

shares of corporate earnings

earnings

dividend

$12

in Table 3 than

revenue

crease

in Table 3.

35.03%

tributed

additional

the

shows

choice

in Table

the other hand, fell
of total revenue in

38.03%

dollar amounts,

corporation income tax being paid
out
of
retained
earnings, with

taxation

$45

earnings,

the

Nevertheless,

corresponding percentage
shares contributed by C's $100 of

Table 1

illustrated

The

the

between the

where

with

compared

blocks

three

also, the

towards

total

the

these

of total revenue

28.17%

poration unchanged. Then the ad¬
ditional/ corporation
income tax
payment must come out of either
retained earnings or dividends.
Table

31.47%

from

earnings,

from

for

$100

shown

corporation's earnings now

contributes
revenue

aggregate net

the

leave

of the

to¬

share¬

corporation increased.
Under any
actual corporation
excess
profits tax, the corpora¬
tion's adjustment to its added tax
liability would likely be some¬

A's $100 share

Hence

here

load

tax

brackets

12 percentage

situation

initial

the

Table

earnings (before tax) of our cor¬

the

$5
on

will

dends received

taxation

$100

$45

shareholders' personal incomes—

(8) Total

(4) Retained earnings
(5) Dividends paid out
(6) Rates

effective

tax

shifting of tax load to be

considered here is illustrated in
great detail in these three tables,

with

that

holders

points, B's by 6, and C's by only
1.5 percentage points, as compared

corporation
excess
profits
tax
is
adopted,
bringing the effective rate of levy
on the earnings of our corporation
up
to 60%. For the purpose of
isolating the factor of tax shift¬
ing, it is here assumed that the
imposition of that excess profits
Now suppose

load

tax

progressive the corpora¬
tion excess profits tax, the rela¬
tively greater will be this shifting

per¬

total

lower-income

holders. And

points

taxation have risen

since

position,

neutral

would be the same $60 under

nue

corporate

either of these two alternatives.

may

advocates

enthusiastic

$20

amounts

dollar

the

highly

for all share¬
holders. As shown by Item (11),
A's
combined effective rates of

his total contribution to the reve¬

be borne more heavily, relatively, by
stockholders than by those in higher brackets.

profits tax

excess

same

centage

earnings would have
for A, $60 for B, and

the

wards

by the

risen, but not

have

Thursday, December 21, 1950

...

corporation's earn¬

the

tax,

each $100 of

fore

illustrations in tabular form how load of

Prof. Jenkins gives

income

taxation

rates

effective

the

that

means

combined

$90 for C. Shareholder B is there¬

University of Arkansas

Professor of Economics,

individual

been

JENKINS

By II. P. B.

The

Financial Chronicle

The Commercial and

(2438)

Tax

against
statement

Institute

Pa., Dec. 9,

own

government
by

Mr.

inter¬

Cortney at the
Philadelphia,

Symposium,

1950.

mak¬

hard break.

creases

big

increases

wages

dustries which
market

Saw

...

costs

and

while

and

taxation,

in¬

buyer's

profit

picture

were

their
.

constantly squeezed between the

Volume 172

Number 4970

The Commercial and Financial Chronicle 7

(2439)

retailer, the consumer, labor and

income tax, however necessary, is

nitely.

other costs.

too

ment

therefore

that

it' should
manner

drafted

avoid

just described

such

World

and

War

II,

Bank has

excess

out

come

ner

favor

make

the

tax

strongly

Con¬

urge

all

man¬

prevent

determined

the

true state

from

profits

1939

"Chronicle"

1936

All

1936

about what is

such.

Nov.

16,

1950,

ered

page

10):

would

better

than

further

corporations.

have

Companies

abnormal

relation to capital or
are

profits

that

and

hurt

perhaps

and

would

tries

bill

tax
the

worse

taxes,

companies that are jogging
along without benefit of defense

spending

think

course,

War II. Otherwise the

than

even

taxed

situation

which

since

ever

will

This
to be the

ian spending. The 45% corporation

the

and

money

only

all

what

send

down

there, not why

lot

and

John

too.

has

Knox

manager

assistant

Announces

Brown

Wall
Formerly

Mr.

manager,

Knox

1925.

active

the

firm's operations in the financing
of international trade.

the

Black

Sox

that

Chicago White
throw

the

public

was

scandals

time

Sox

World

several

caught

were

Series.

baseball

members

The

horrified and there

were

stuff in the newspapers about the

youngsters
hearts

So,

ably it

was

getting

the

Reilly

Broadway,
nounce

ment

of the firm

will henceforth

Irving H. Camp¬
whom have been

and

both

Blizzard

telephone .to
& Co.,

(Special to The Financial Chronicle)-

Inc.,

LOUIS, Mo.—Myer S. Stein
has become associated with Fried¬
Brokaw
&
Co.,
711
St.
Street, members of the
York" and
Midwest Stock

man,

Charles

He was formerly with

City,

Schul

an¬
direct

staff

New

Herbert

Walnut

has

Ohio

—

& Co.,
members of

326
the

York

and

Cincinnati

Stock

Lynch Co.

(Special to The Financial Chronicle).

the

added

Westheimer

Street,

With Merrill

William
to

been

ASHEVILLE,
Simmons

Lynch,
22

Exchanges.

Philadelphia^

Co.

Richter

Scherck,

(Special to The Financial Chronicle)

CINCINNATI,
A.

now

Pierce,

C.—John
with

Fenner &

hot

shot

publicity

of unimpeachable

serve

man, of
honesty and

This

announcement

is not

offer to sell

The offering is

the high commissioner of

Beane,

Battery Park Avenue.

or a

solicitation of

offer to buy these securities.

made only by the Offering Circular,

Bushy, white haired Kennesaw1
Mountain Landis, who as a Federal judge had
game.

once

Carlisle

socked

Standard

fine and aroused the

Bargeron

Oil

with

$22,000,000

$29 million

imagination of

tatfain

people, was chosen. There were some chores
to the job but mainly the good name of the
judge was to be used
to restore

Came the
nates that the

this

was

of baseball

Happy,

judge's end and it didn't
good

name

First and

to the baseball mag¬
been restored and that

occur

of baseball had

office they could dispense with. A high commissioner
had been established and it had to be carried on. So

United States Senator,

The Western Pacific Railroad

was

carry

Refunding Mortgage $Vs% Bonds, Series A
Due January 1, 1981

Dated January 1, 1951
•

'*•

•

chosen.
The issuance and sale of these

yoif would suppose that the magnates being free men
perfect right to fire Happy if they want to, providing they
out the terms of their contract with him whi^h they are

Now

have

Company

confidence in the game.

Bonds

are

subject to authorization by the

Interstate Commerce Commission.

anxious to do.

Here is where they are to be initiated in the fan¬
tastic, artificial world that is politics.
As
to

the

was

Price 100.485% and Accrued Interest

politician, Happy was trained not to deal with facts or
proposition that two and two equal four.
He

scientific

trained in the world of make believe where two and two

are

made to equal five.

Thus, it so happens that a majority of the magnates voted to
Happy's contract but it takes 12. However, on the basis
of his getting a majority to support him, he is out now with a
campaign that a majority of the magnates want the game kept
on the high plane which he has set but a wilfull
minority wants
u'.

The

continue

return

tactics, of

may

be obtained in any State in which this announcement is circulated from
as may

Union Securities Corporation

the good

course,

Offering Circular

only such of the undersigned and other dealers

old days of banditry. Happy learned these
from the New Deal. It makes no difference that

lawfully offer these securities in such State.

Glore,Forgan&Co.

this strong

minority may have very good reasons for being tired
supporting Happy in the estate to which he is accustomed,

They will be made to

appear,

political training in publicity,

as worse

over,

They will have been

that not unlikely they will be

increased grandeur for the sake of the
It

American SecuritiesCorporation

glad

smeared

before it

keep Happy

Hayden, Stone & Co.

game's good

F.S.Moseley&Co.

Hemphill, Noyes, Graham, Parsons & Co.

Alex. Brown & Sons

name.

The Milwaukee

is not

instance
It

White,Weld&Co.

than the Economic Royal¬

ists who enslaved workers and widows and orphans in the vocabu¬

lary of the New Deal.

with Happy's silvery tongue and

unimportant to study Happy and his tactics in this
by way of learning how the politician's mind operates.

will

help explain the amazing spectacle in Washington of the
being conservative in their rearmament plans while
Capitol Hill insists upon gorging them with money.

Francis I. duPont & Co.

Company

A.M. Kidder & Co.

Baker,Weeks & Harden
Riter&Co.

military

You will find

Capitol Hill generally agitating in the direction

of Governor Dewey's proposal for an army of some 15 million men
and

all-out

complete

industrial

mobilization,

whereas

Marshall is urging caution and counselling that we hold

military establishment

size

that

can

General
our

maintained

new

indefi¬

First of Michigan Corporation
December

20,

1950

Shearson, Hammill & Co.

Merrill

great national pastime.
had the brilliant idea, prob¬

some

man

„

ST.

New

Westheimer Co. Adds

Co.,

York

New

Joins Friedman, Brokaw

depart¬

be under the direction of Percy R.

Hampton

Edward

Reed, Inc. of Kansas City.

Exchanges.

the installation of

private

millions of

Director

and

American

The

firm.

—

announce
as

the

Mo.

JOSEPH,

Hubka is connected with Waddell

the

someone

character to

West,

ST.

country having broken
again would there be any

never

(Special to The Financial Chronicle)

Changes

Vice-President

Blizzard in Phila.

rpams

Street,

King

Reiily Phone to

loving

Irving J.

Co., First National Bank

the

over

and

confidence

fix

with

associated

Joins Waddell & Reed

with the firm for many years.

the

PAUL, Minn.—Kenneth D.

become

the retirement of H. L. Somers

years

baseball

Gouinlock
25

bell,

ST.

Ont., Can. —Bell,
Company, Limited,

TORONTO,

ap¬

been associated with the firm

since

they will wish they had never heard of
Happy Chandler before they are through dealing with him.
To get the picture you have got to go back

Irving Rice

Aws and Adrian J. Meunier have

•

The maior

ago.

Two With

Bel!, Gouinlock Go.

been

Street, New York City.
has

It is my guess that

Co., Roanoke

down

Rice

Brothers Harriman & Co., 59

league baseball owners are now by way of learning
something about the great game of politics and the men who work

Steichen &

Building.

Manager of
A.

pointed

By CARLISLE BARGERON

Engstrom has joined the staff
R. J.

Building.

Knox

policy.

Wiashington
Ahead
of the News

it.

MINNEAPOLIS, Minn.—Joseph

(Special to The Financial Chronicle)

be represented

easy-

From

South

In our country the political mind is utterly essential and is
quite understandable. It is. too bad, though, that we don't have
some more leadership of industrialists, so that their mind would

indus¬

112

Exchange.

to Korea

were

Co.,

Street, members of the Mid¬

Joins R. J. Steichen

all.

Brown Bros. Harriman

Minn. —Clar¬
joined the staff

(Special to The Financial Chronicle)

He wants

first reaction

caused his

Dain

west Stock

;

•

Sixth

by World War

inflation

•

make

bad

there

excess

state

Exchange.

E. Ladd has

ence

question of why, with the money he had voted for,

have

didn't

1946, due to abnormal

are

new

mental

Third National
members of the

(Special to The Financial Chronicle)

accordingly.

regardless of what it cost.

Ladd,

Building,

MINNEAPOLIS,

coming in world affairs but he is quite sure that
there is not going to be any issue against him that

for preparedness,

— Robert
S.
affiliated with

now

With J. M. Dain & Co.

military came to Congress ask¬
ing for $20, $40 or $50 billion he told them they needed more and
insisted they take more.

into

take

had

have

conditions created

by curtailment of civil¬

comes

he wasn't

account the distortion from World

past earnings

better able to bear

and

when it

consid¬

Ohio

New York Stock

to be able to show that when the

can,

equitable

that

income

large

profits

this

other formulas, but I believe that
the one just suggested would be

increase in the straight income tax
on

will

average

excess

One

"A moderate tax of this type, a
supertax for the national defense,

multiplied

of affairs and to act

Greene

Bank

community, the politician knows there are
countless ambitious men who aspire to his job and are studying
the "Congressional Record"
closely every day with a view to
getting an issue against him. Just now he has little or no idea

with the

1939.

the

excess

period

national

DAYTON,
Walton, Jr. is

Back in his home

corporations in the period from

1946 to 1949 as compared

panies his proposal for an excess
profits tax with
the following
comments,
among
others
(see

(Special to The Financial Chronicle)

propaganda barrage is loosed, it is simply too exacting of him and
dangerous to try to expose it. His disposition is to accept it as the

manner:

period

With Greene & Ladd

pendulum swings back

much extreme in unbuilding it.

Now the reason for this attitude oh
Capitol Hill is the pol¬
itician's trait of not adhering to facts but of
living in a world of
propaganda and wanting to keep his own skirts clean.
When a

government will calculate
the average increase of profits of

not destroy1 in¬
Leffingwell accom¬

Mr.

Formula

The

profiteering and
centive.

therefore

should

profits tax provided

this tax is drafted in such

Proposed

following

just

So, we have a situation whereby for the first time in history,
suspect, a general instead of being looked upon as grasping and
wanting the sun, is being smeared in Capitol Hill cloakrooms and
in a portion of the
press as having become senile.

gress that if an excess profits tax
bill is enacted the excess profits

the

and

extreme in building up the establish¬

accentuating

distortion

in the conviction that when the

companies. "

easy
money
policies ever since
1946. Mr. Leffingwell of the Mor¬
gan

He hates to go to

now

will go to

quate reserves, for the "jog-along

disparity with which part of our
economy is still struggling as a
result

high already to be healthy, to
fair dividends and ade¬

permit

profits tax is to be enacted

excess

the

submit

funds

Economy]

Program for Defense
By MURRAY

SHIELDS*

lays down

decision-making

government

dear—our

f.
.

ate-a "tumble.

plays with

our

all

skill

the

call

must

(4)

possess.

is imperative-

that

necessary

dedicate ourobjectives on

selves to three vital

the attainment of which

our

future

depends.

and

improve

must

very

must leave no stone unturned

effort

our

and

which

real

there

objectives

has

reference

doubt that

latter

the

both processes so

the basic

realize

limit

manage

There is

been made.

(1)

combination

high taxes and bond issues. But
the risks here are so great that
jn

Therefore it

Murray Shields

from

already
for

room

confronted with

we are

dilemma,

neither

but

to doubt that we can

reason

strengthen the process of governdecision-making,
covering
the entire range of domestic and

surmount the

ment

discard

foreign policy.
(2) We must mobilize

siderations of

our

present crisis if we
prejudices,
forget

self-interest and abandon all con-

political expediency.
a powerFor the purpose of stimulating
enough military force to deter public consideration of these probor
resist
aggression and do so lems, I would like to present a
with the minimum of danger to tentative and very rough program
the economic
growth on which to strengthen our leadership, motomorrow's military potential de- biiize
our "strength,
insure topends.
morrow's military potential and
(3) We must stop inflation dead stop inflation.

ful

(l)

Every patriotic

citizen

owes

to his nation to do the hardest and

should

There

mustered

into the decision-making group at
the helm of the government lead-

clearest

thinking of which he is ers of unquestioned distinction,
capable on the specific measure$> demonstrated competence and of
by which these vital objectives ldng and extensive experience in
can be realized, and then, beyond
the larger affairs of the nation's
that, to demand in the strongest life. When the fate of the world
terms

whatever

that

be taken

necessary

action

quickly

is
as

possible.
It is essential that

that

recognize

the

magnitudes with which
we may have to deal in the event
of total war are simply heroic,
The vital considerations are:

That all-out atomic, global

(1)
war

entail

would

than

than—$150

expenditure

—

perhaps
much
billion per an4

num;

(2)

that, with

public debt of

$263 billion, we would be court-

ing disaster not to

pay

of our defense or war
we

for most

outlays "as

go";
that, in view of the infla-

(3)

address

*An

Annual

Luncheon

Mr.
of

Shields

The

Trade, New York City, Dec.

57th

Bronx

1950.

now

the

escape

flation

York

adopts

wide

range

ex-

tremely "difficult and obviously
dangerous issues, the need is urgent for the appointment by the

defense

zation

York

Hoover, to name but a few—who
would inspire the confidence of
our friends and command the
^ri^nd and foe^ alike,
The
President
could

service

greater

render

this

Commodity
Chicago
New

crisis than to bring into his coun¬
cil our "Elder Statesmen."

The

(2)

President

should

into

the

when

our

nation's4 and

the

labor

unions

emer¬

And

Cotton

other

Trade

ford

Exchange Bldg.

NEW YORK 4, N. Y.
-

CHICAGO

DETROIT

•

Ir'l

PITTSBURGH

GENEVA, SWITZERLAND

Witter &

strikes

the

other
no

less

volun¬

profits

—

upon

•

should

ities

take

whatever

steps

Caterpillar Tractor, Foster Wheel¬

needed to prevent any further

are

bank

and

the

increase

est

but

total

that

•

Cutler

•■

Walnut Street,

profits

6, N. Y.

increase

would

centive to

& Co., 1342
Philadelphia 7, Pa.

in-0

the

Oil Stocks—Bulletin of comment

Gulf, Mobile & Ohio Railroad—

savings and lower

new

with particular reference to those Analysis — H. Hentz &
Co., 60
outstanding government having interests in the Middle East Beaver Street, New York 4, N. Y.
I
issues would serve to discourage
—Eastman, Dillon & Co., 15 Broad
liquidation of present holdings. Street, New York 5, N. Y.
Interstate Motor Freight System
Shields & Co.,
Furthermore, the Treasury should
Also available is an analysis of —Memorandum
44 Wall Street, New York 5, N. Y.
redesign the Savings Bonds so as the Outlook for the Railroads.
to give them considerably longer
Also available is a memorandum;
maturity, increase the interest rate
Over-the-Counter Index—Book¬ on Zonelite Co.

prices

—

incentive

duce

penalty
before maturity

intro¬

and

let

redemption
to discour¬

for
as

showing

need

inflation and we shall
desperately to increase pri¬

vate

savings

monetary

to insure
build an

are

effort

our

this

Parts

program

may

obnoxious

the

and

Averages

would

tation

Bureau

Averages,

both as

the

Front

Street, New York 4, N. Y.

Broadway, New York 4, N. Y.

four

week's

issues

etary expansion and reducing con¬

and

fective.

such

but

popular,

that
ous

not

emergency

this would

can

$5.

New York

—

The Value Line In¬

sure

will, when
we

had.

5 East 44th St.,

17, N. Y.

with reference to

possible tax

Saxton

1006

Wash.

Corp.,

Higginson

•

memorandum

Co.,

Co.

—

Baird

•

Chambers

Co.,

Company—
—

office,

105

Adams

South

Salle

United Corp.

—

Memorandum

Parker

channel

the

—

Robert

U. S. Thermo

110 East Wisconsin

—

Raymond

.ia

Co.,

memorandum

Also available is

Simplex Paper.

Pabst Brewing Co.

that

SECURITY ANALYST
AVAILABLE

REASONABLE SALARY

Phillips

PLUS

Box

1213,.

Chronicle,

•.

148

State

Street, Boston 9, Mass.

MATURE JUDGMENT

•

—

Redpath,

Control—Analysii

CONCISE WRITER

ton.

Street, New York 5, N. Y.

formerly with C. F.

Leonard G.

Chi¬

Manufacturing

Childs & Co.

Street,

4, 111.

cago

Gundy

Street.

Sc.

randum—Sills, Fairman & Harris,

Gundy & Co.

West

was

Lerner

ton 9, Mass.

Auchincloss,

Memorandum

Also available is
on

Mr. Yates

Wall

Square, Bo»-

10 Post Office

52 Wall

Allis

Cement

Riverside

Card

209

Co.,

Inc., 70 Pine Street, New York 5,

Warren Yates Joins

111.—Wood,

Street, New York 5, N. Y.

con¬

Avenue, Milwaukee 1, Wis.

& Co. Incorporated announce

—

Tele-Tone Radio Corp.—Memo¬

Utilities—Discussion of situation

vigor¬

adopt

wish that

comes,

peace

—

vestment Survey,

during the defense

measures

war

offer

sideration—G.

No program
be

Ltd.

Analysis plus Tax Shelter analysis

Ratings and Reports—Special

mon¬

Development,
—

Quaker Oats Co.—Memorandum

1951

taxes

Memo¬

—

John R.. Lewis, Inc.,
Second Avenue, Seattle
4,

—Lee

Sell—

Stocks to Buy—Stocks to

and

after

Placer

Analysis

problem by balancing the budget,

incomes,

Corp.

Walston,

—

yield and market performance

strike at the heart of the inflation

increasing savings, stopping

Steel

Newport

Hoffman &
Goodwin, 265 Montgomery Street,
over
an
eleven-year period—Na¬ San Francisco 4, Calif.
tional Quotation Bureau, Inc., 46

treme

—

industrial York 5, N. Y.

over-the-counter

of it

Most

Company

brochure—Kidder, Peathirty- body & Co., 17 Wall Street, New

randum

controversial and difficult to leg¬
administer.

Electric

McGraw

stocks used in the National Quo¬

impregnable defense organization

islate and

com¬

industrial stocks used in the Dow- Analytical

cannot-tolerate five k

invested.

up-to-date

parison between the thirty listed

inflationary spending of funds Jones

age
so

basis

need; to

—

would,

Leonard G. Phillips is engaging
usual, when our
need for production is as great as
in the securities business from of¬
it is today.
•
*
"
fices at 20 Exchange Place, New
v(3) Government agencies should
York City.
He was* formerly a
be: directed to cut non-essential,
non-defense expenditures to the principal of Phillips & Welling-:

bone.

Special

circular—Newburger

New York

Inc.

Hammer,

Blaw-Knox, and E. W. Bliss—
E. F. Hutton & Co., 61 Broadway,
er,

currency

deposit money. Inter¬
of course, rise,

rates

We cannot af¬

usual,

Co., 14

Street, New York 5, N. Y.

impact

tions

shortages and hold

prices.

usual, politics

N. Y. Cotton

Wall

taxes,

ciated with the firm in its Chicago

the line

Exchanges

California Packing Corp—Mem¬
orandum—Dean

Warren S. Yates has become asso¬

clauses.

—

CHICAGO,

due to wartime

Exchange

Company

Bag

Bro.

Wood

hand, he should demand
vigorously that business
tarily forego any excess

Inc.

Bemis

increases, agree to the elimi¬
of
featherbedding prac¬
tices, accept a longer straight-

calator

leverage, market position
Cedar Point Field Trust—Memof defense prepara¬
Yarnall
&
Co.,. 1528 '
the rails as a whole orandum
and projected valuation of 25 com¬ Walnut Street, Philadelphia 2, Pa.
*
(5) The corporation taxes must
be raised, but they should be re-1 panies—Brady & Co., 52 Broad¬
Cleveland-Cliffs
Iron
Co. —
v :./■
cast to provide an incentive for: way, New York 5, N. Y.—$5.
Analysis—Vilas & Hickey, 49 Wall ?.
the retention and investment of1
;
Electric and Gas Utility Cora-, Street, New York 5, N. Y.
corporate income and the use of
Also available is an analysis-of :
new
funds to, expand -capacity-, - pany Common S.toek&r— 12th edi-.
Missouri Pacific Railroad.
>
tion of tabulation of issues—First
.when the peed for insuring to¬
Boston
Corporation, jOO Broad-:
morrow's-productive potential is
way, New York 5, N; Y.
J • •; .^Collins Radio - Co. — Memo¬
so critical.
"
randum—Butler, Moser & Co., 14
(6) The Federal Reserve author¬
;
Machinery Stocks—Analysis of Wall Street, New York 5, N. Y.
in the balance.'

future hangs

refrain

nation

Exchange

Board

de¬

publicly and unequivocally

Exchange

Exchange,

Orleans

the

resources

time

N. Y.

Analytical brochure—Blyth & Co.,

President of a Special Emergency
Council
into
which
could
be savings, to approximately the level
of
civilian
goods
production—
brought our really great private
measures without which any freeze
citizens—such as Baruch, Byrnes,
of prices cannot possibly be ef¬
Conant, Donovan, Eisenhower and

Curb

Exchange

—

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

time work-week and agree to the
abandonment of all contract es¬

Cotton

capital changes in
Laird, Bissell &

and

years

costs of zation, competitive position, man¬
to impede the mobili¬ agement,
merger possibilities,

effort

fense

sumer

Stock

York

New

dividends

Light—Fol¬

American Power &

low-up report—Kalb, Voorhis &
Co., 25 Broad Street, New York 4,

Coming Boom in Railroad Stocks Inc., 14 Wall Street, New York 5,
—Comprehensive report including N. Y.
collector. a discussion of rates and earnings,

revenue

skyrocket

wage

New

interest:

cannot^ afford to permit in¬ traffic, regional factors, capitali¬

from strikes for further rounds of

Members

Holders—Develop¬
a
list of cash

Stock

Puts & Calls—Explanatory pam¬

gency

H. Hentz & Co.

Bank

phlet—Thomas, Haab & Botts, 50

that for the duration of the

1856

Among

war comes.

ex¬

mand

Established

of funds required in the

the highest incomes, some

mentioned will be pleased

parties the following literature:

peacetime. But all of it
may well be essential in time of
crisis to strengthen our leadership,
for generations to come may be
to divert civilian labor, produc¬
determined
by the actions our
government takes, by the attitudes tion, consumption and incomes to
it assumes and by the policies it the defense of the nation and to

Board

14,

interested

send

recent

success

in its tracks.

understood tfuit the firms

It is

provide

degree of tax exemption on pri¬
vate savings and devices to collect
taxes on invisible incomes which

ready

war

and

ments

well

I;; lossal. We dare; Of our society.
hop'ihake.- a,. Under- the circumstances, we
K
.^miSfa'kA-'We shall probably have no option but
l: ~c$nntot> Holer- to finance the cost of a full-scale
We

ahead

basis for collecting the colossal

income tax rates on the lowest as

that the tax burden is also high that it will not be
nation r—is at easy to treble Federal Government
s t a k er- The
tax revenues without doing irreprisks are co- arable violence to the very fabric
existence

Recommendations and Literature

substantial

general sales taxes, reduction in
personal exemptions, increases in

and,

tion—our very
*

Dealer-Broker Investment

some

pass

consideration should be given are

of tionary erosion which has already

civiliza-

o u r

of.'

the tax measures to which serious

taken so heavy a toll of existing
savings, it is likely to be much
more difficult in this emergency
ard of living, than in World War II to find prio u r freedom,
vate buyers for war bond issues;

faced.

ever

anti-inflationary

produce

event that total

crises this nation has
Everything we hold
way of life, our stand-

the gravest

Amounts

unquestionably one

This

effective

mediately

of unquestioned dis¬

group

Congress should

(4)

no-strike, no-wage increase policy during the
emergency; (3) reduction of non-essential government spend¬
ing; (4) anti-inflationary taxation; and (5) immediate steps
by Fed. Res. to curtail increase in currency and bank deposits.
(2)

time

budget surplus in the months im¬

and strengthening

tinction;

workers

activities'

emergency.

taxes

as vital objectives: (1) improvement
of government decision-making processes;
(2) mobilization of military force powerful enough to deter
aggression, but without disrupting national economy; and (3)
curtailing current inflation. Proposes, among other things:

Mr. Shields

the

and

essential

really

of the Manhattan Company

Vice-President, Bank

(1)

December 21, 1950

The Commercial and Financial Chronicle... Thursday,

(2440)

COMMISSIONS
Commercial
Park

Place,

and

Financial

New

ViCLi

York '1 .■* wL'

analysis of

V,.

Volume 172

Number 4970

The Commercial and Financial Chronicle

(2441)

that the businessman will

This Peculiar

Emergency

understanding rather than
complaint. These regulations offer

By W. RANDOLPH BURGESS*

Chairman, Executive Committee, National City Bank of New York

Pointing out there

are no

precedents

present emergency, prominent
nomic

patterns to guide

New York banker lists

eco¬

reasonable way of

cutting down
spending for automobiles, houses,
refrigerators,
televisions,
and
many
other things which make
life pleasont, to make room for

(2) less public
public saving. Cites bankers' role in
achieving these objectives, and advocates group committees of

■certain

Reserve district for collective action.

The

generation, the generation
here, has met and
three

overcome

major

the

wars

ression.

great

breath,

the face of

these

difficulties

the only over-all answer is a great
national
effort, as great as or
War

World

made

may

stimulus.

our

core

democracy.

though there

time

catch

the

are

greater than

with

Now,

scarcely

which

American

emer¬

gencies, including two world
and

tions

War

World

II,

even

not be open war

this

effective

effort calls for national unity, and

we are

faced with

another

beyond anything we have achieved

tional

na¬

international understanding far

before.

crisis,

different,
more

In the economic

much

Korea

our

W. R. Burgess

young

men

are

humiliating retreat, and may con¬
ceivably face another Batan or
another Dunkirk.
And

behind
of

menace

semi-civilized

under

control

lies

the

people,
standards,

our

small

a -

group

which seeks world empire

by in¬

sidious, subtle, and violent

means.

We have learned in
to

lives

recent

weeks

cost that international

our

munism is

com¬

prepared to spend the

of its

freely to gain

masses

This

crisis

uncertainty.
dents
It

different

There

are

patterns to guide

its

prece¬

democracy and Communism
likely to continue for the

lifetime

every

this

person

room.

of the

problem. On the edge of China
face armed forces in the

potential millions be¬

many

million

are

tain this power
the

immune. To

con¬

completely is be¬

yond the strength of
even

the

cover

globe, with few

which

arms

Communist

men.

Intrigue and infiltration
face of the
areas

millions,

hind them. Russia has under
several

might of America; and

have learned bitterly what it
means
ta overcommit ourselves,

This

our power

to fulfill.

can be won only
exceptional degree of
international
understanding and
cooperation. Our forces must be
supplemented by^ those
of
the
an.

Western

democracies.

cohesion

agreement
action.

well as
moral

This

nomic

ideas

calls

for

well

words

war

make

of weapons. It is a

war

even

than

effort

over

with

many

grave

eco¬

dangers—dangers of infla¬

complicated
have

the

discovery

subversion

midst; in government, in

our

versities, and in the ranks of
workers.
from
the

the

tools

our

uni¬
our

Communism is working
inside as well as from

outside.

tioned

Many

people
of

have

well-inten¬
become

Communism,

the

through

their

failure
to
appreciate and
support the institutions and tradi-

suspected. We
when we have

can

to.

one

compared

War
we

with

II. Even with

World

present hours

beat present records;

can

better

with

management,

effort, and

with

greater

team

work.

Second,
other

must

things

spend less on
free our energy,

our

material, and our produc¬
tive capacity, and our money for
the weapons of war. We have been

living

the

crest of the wave,
lush national existence by any

of the old

standards, whether it is

terms

the

number

automobiles, the building of
houses, the use of telephones, the
consumption of food, the number
of

radios

and

lavishness

ing,

♦An

address

by Mr. Burgess before the

Credit

can

Bankers

Dec.

16,

be restrained.

With such a definition and under such
leadership it
should be easier for the average

banker

the

economic machine.

have

large

Third,
There

Another form of restraint which
is not only desirable but essential

restraint

extravagant government spending for non-defense
purposes. If such spending were
cut

back

only

the

1948, there would be
$6 billion.
in

levels

savings of

Government would

better position to ask people

hands

own

clean, but the politicians in
will do this only if they

banker

comes

because

in,

in each

man

ahead

and

the

preserve

value

of the dollar.

In the category of spending less
and

concentrating

efforts
eral

defense

problem
has

ence

the

comes

which

been

restraining the

this

nation's
the gen-

Confer-

considering,
of
use of credit for

unnecessary purposes. This is perhaps the hardest thing the banker
has to do in the present national

much fat

banker's best aids to

nation's economy on
keel,

save

less

inflation;

means

just

even

harsh

role.

now

The
for

most

promising suggestion

down to practical action seems to
me

the

proposal

for

group

the

for

another

two

government

indeed

Wars

our

crisis

ent.

work

effectively.

with

just

the

truly

the

with

work

us.

government
In

the

and II and since then the bankers

of the country made

our

record in the sale of Government

There

struggle
a

tendency

today

ment.

first

cannot

deteriorated

we are

win

now

that it pays, in terms of providing
the funds for building more fac-.

tories,

and

better

Jw-v
*. 'tv*

team

\yill have to be called

into

first,

that whatever criticism of
this sort is made of Savings Bonds

applies equally to the savings deposits which he takes in over the
counter,
to
the
life
insurance
which most of the families of the

action, and the team will have
respond when it is called. If

the

does- get

In Smith,

The answer to the inflationary
trend is not to sell less Savings
Bonds, but to sell more, and at the
A

Barney Go.

Winfield H. Perdun will become
a

partner in Smith, Barney & Co.,

Wrall

Street,

New

York

take
us

savings deposits does place on
on
the government that

and

issues the bonds

solemn obliga-

in Laurence M.

Marks

standard

houses, and a
of
living after
giving many fami¬
lies a buffer and a cushion against
times of adversity.

more -

mature

(Philadelphia Plan)

$373,000 annually

Clark to

Partnership

SPRINGFIELD,

Mass.

agree

statement

the banker has
for

our

the

national
a

foregoing
objectives,

vital role to

economic

play;

machine the

flow of money

lubricating

is like the flow of
oil in an industrial

Conference of the Ameri¬

Association,

1950.

yield 1.75%

Stock

thur

Exchanges, will admit Ar¬
M.- P.

Jan.

Clark
Mr.

partnership

Clark

has

each December 1, 1951

1965, inclusive

2.65%, according to maturity

Issuance and sale
The■

The flow of money

essential.

of these Certificates are subject to authorization by the Interstate Commerce Commission.
Offering Circular may be obtained in any State in which this announcement is circulatedfrom only
of the undersigned and other dealers as may lawfully offer these securities in such State.

such

prime

•

HALSEY, STUART &, CO. INC.

First, the bankers

can

duction by seeing that

aid

pro¬

all the fi¬

Chicago,

III.,

R. W. PRESSPRICH

&. CO.

HORNBLOWER & WEEKS

nancial machinery runs

smoothly,
judicious application of
credit at the right spot, and by his
by

the

counsel to

the

businessman.

action of the Federal Reserve Sys¬

through Regulations W and
X, and through its moves on credit
policy. The banker can explain

support these regulations,

LYNCH,PIERCE,FENNER&BEANE

FIRST OF MICHIGAN CORPORATION

Second, the banker can help in
restraining non-defense spending.
This has been recognized in the

and

MERRILL

THE ILLINOISCOMPANY

L. F. ROTHSCHILD&,CO.
FREEMAN & COMPANY

WM. E. POLLOCK &

CO., INC.

WEEDEN&CO.
INCORPORATED

McMASTER HUTCHINSON & CO.
December 15,1950.

Tifft

mem¬
bers of the New York and Boston

guaranteed unconditionally as to payment of principal and dividends by endorsement
by St. Louis-San Francisco Railway Company

Priced
we

—

Brothers, 1387 Main Street,

the war, and in

To be

,•

Tifft Brothers to Admit

Equipment Trust Certificates

f-mV.V •'

Co.

been

with the firm, for many years.

tion to protect their value.

2%%

City,

level from getting out of hand, members of the New York Stock
What -is needed today is a great Exchange, on Jan. 1. Mr. Perdun,
national movement of j all of the who joined Smith, Barney & Co.
people to support the defense pro- in July, was formerly a partner

"pro

work

Perdun to Be Partner

are buying, and to pension
plans which we all support.

time to do the other things

team

always have in the past.

country

we ought to do to keep the price

first

with high morale and with energy
we
can
win again; just
as
we

Railway
Equipment Trust, Series H

'.»v

or fourth team govern¬
To win this struggle the full

St.Xouis-San Francisco

must
did in

the

facing if

third

use a

Government

Savings
Bonds because their buying power
has declined as prices have risen.;
The
banker
should
remember,

same

men.

Bonqls.
criticize

has

government

magnificent^ despite efforts to recruit
good

$5,595,000

few years many bankers will have
to serve the government in one

more.

II.. We found

must

government and—
—

and

and the government work together
we cannot
possibly meet the pres¬

the

money

years,

have

government. Unless the people

our

we can't shrink from it The
fact that we sell Savings Bonds or

getting beyond generalities and

not

and

interest.

over.

He has always opened his
place or another. In the years
doors to savings deposits. He has since World
War II thousands of
encouraged
investments
by
his able
people have left the govern¬
customers, and in World Wars I, ment
service, and the quality of

not

national

But the election

This Administration
will be in office whether we like

2ram> to produce more, to spend

the

the part of
citizens to throw the
on

government out.
is

said, including

were

desire

many earnest

less, and to save more. There is no
better vehicle for educating the
people in this essential step than
a steady and persistent campaign
to persuade people to buy Savings
Bonds. That is the banker's job,

things

ardent

must

Third; the banker can foster
savings. It is his time-honored

com-

For the banker is

automobiles

try to spend all

save,

keeping

our

We have

can

must

will

World

peting for business, and the way
to get business from businessmen
is to make loans. Moreover, the
banker shrinks from settipg himself up as a judge as to whether
any particular loan is justified or

program.

and houses and knick-knacks pro¬
duced to spend our money on, and
we

discretion

the

support a
program and still live

arms

exercise

lending. This will never be
really easy, but it will be one of

well.

very

question of

just been through a bitter election
campaign in which a good many

government

bones that

our

inflationary and should

the

government.

spend¬
other standard. It is

any

because

televisions,

are

his

simple; the

are

tem

National

which

focus

done: the grass roots. That is where the

the job

thing, we can work longer
hours.
The
working week now
averages little more than 40 hours,

run.

On all these fronts the
problem
we

meet with the presidents of the
Federal Reserve Banks, and would
seek to devise definitions of the

plant—without it the plant won't

democracy is based.

that

relation

The Banker's Job

vast

rob us of the freedom upon which

representative bankers, insurexecutives, and investment
bankers. These committees would

tion and dangers of regimentation,
which
uncontrolled might well
our

For

war.

carries

years

effective

war

physical
,

ever

produce

struggle

through

this

than

country,

any

beyond

get

following, that America's pro¬
capacity is hugely larger

defined

is gigantic in the size

with

ductive

and

appalling in its probable
duration, for the great conflict be¬
seems

Working With Government
This raises

ance

they will do the least
long-term damage in crippling the

field, the things; have support and mandates from

regimentation

us.

tween

individual

its ends.
;

problem

community who
but tough.
understands, or ought to underThe first thing is to produce: stand, something about the Fedmore.
The production index has eral
budget, and
can
tell
his
now
broken
through
the
old neighbors why govermental econpeacetime ceilings, but we dis¬ omy is essential if our side is to
covered, in World Wars I and II win in this great conflict which
and

Korea

vast horde of

main

taxes where

are

without inflation and without too

gone before.

.In

must

have

organized by Federal
Districts, on which would

power

than any of
the
three
which

to make sacrifices if its

The Economic Requirements

baffling,
exacting

amount

spending, and
there is no escape
from heavy
taxation. The general acceptance
of the pay-as-you-go
principle is
a
bright spot in a dark picture,

all classes of bankers and insurance executives in each Federal

Our

Reserve

Taxation, also, will kinds of credit that are desirable to
almost automatically cut back a
promote production, and the kinds

represented

committees

defense work.

(1) greater production;

requirements:

spending; and (3)

comply

with

MULLANEY, WELLS & COMPANY

(2442)

working hours and increased em¬
ployment drives total incomes up.
If
incompletely taxed, a likely

Wage-Price Controls
in collective

creased

and Finance, N. Y. U.

bearable

prices upward. This too is a com¬
wartime phenomenon. It oc¬
curs
even if wage
rates are held

between two types of wage adjust¬

Economist distinguishes
ments

mon

based

bargaining, viz: (1) wage changes

constant, as they presumably

productivity; and (2) cost-of-living wage increases. Holds,
because of adverse effects and inequities, both types should
on

Seaboard Air Line

would

prices

rise,
the
contract
automatic cost-of-

been

clauses granting

living

become

increments

wage

Air Line

Seaboard

be under existing legislation.

authorities.

deprived of automatic character by regulating

increased incomes mean in¬
spending power, and un¬
pressure
which drives

case,

By A. L. GITLOW
School of Commerce, Accounts

has the Additions and Betterment fund

common

ulative favorites in the boom rail-

market

road

the.

Deteriorating

international

ture, means rising unit

re¬

With

pressing the subject of

are

must

control,

As they are

by" legislation
provides that
must

both

instituted si¬

tion

legisla¬

recog¬

nizes the inti¬
mate

connec¬

tion

tract clause. But we have seen one

between

prices

Abraham

are

Gitlow

effect,

cannot

have

admits
real

this recognition
m&y not be sufficient to guaran¬
tee effective price control, should
that eventuality be forced by total*
war. i
Two contract clauses, which
increasingly

braces

first

annual

the

second

automatic

the

automatic,

provision

The

tions
;

war

malities.

Students

of two factors.

firms

creasing
them

Germany's lost

First,,

opportunities
to
acquire

Automatic

annual

the

which amounts to

some

Throughout

long

its

receiver¬

of indus¬

ship, and in the years since the
try are available to every Amer¬ receivership has been terminated,
ican much below book value or Seaboard has been in a position to
in

resources

He can buy one

replacement cost.
of

stock

easily

100

It took 20 years

more.

the gambling approach
to the Stock Market to one of in¬

spend lavishly on the properties,
structure and yards

The roadway

have

been

improved

materially,

and maintenance has been

mech-

anized. Also, the road has gone

Therefore, today the public is so
conscious of the values of common

and

equities and is aware of the lim¬
ited and controlled inflation frozen

pleted.

company

Businessmen

used

St.
Ernest Jellinek

Germain

were

the seeds

of World

II.

The

rsay.

economic

The

War

splitup of the old Austrian
resulting in high tariffs

Empire

and unbridgeable barriers between
the newly created Central Euro¬

States;, and in the case of
Germany, reparations, loss of ex¬

to' offset

reduced

worker

price of

effec¬

tiveness by capital improvement—

many

postage stamp

came

billions of marks. Fur¬

ther, lack of foreign currencies to
import necessary raw materials

brought industry into bankruptcy
source of produc¬
with an impossibility to stop in¬
tivity advances.
The reason is
flation. The German people could
simple. The industries which pro¬
-not protect their
savings and in
duce capital equipment are tied
desperation were driven into the
up in war production.
This is a
hands of the Nazi politicians, hop¬
common
wartime phenomenon.
ing for a savior out of this eco¬
The consequences are plain. Un¬
nomic collapse.
favorable productivity, coupled
In our country
today inflation
with wage increments which as¬
is the topic of every editorial, po¬
sume a favorable
productivity pic¬ litical address and talk in !
the fundamental

every

1 I am not discussing here the relative
of a fully controlled economy to
fight inflation under partial mobilization,
aa
against one which fights it by attack¬

circle

into

our

society.

How different,
the circumstances! We

the

ditions?

not

the

and

A.
L.
Gitlow,
Improvement Provi¬
sions," Review of Economics and Statis¬
tics, f'ebruary, 1950, p. 103.

**Automatic .Annual

sufficient
are

economy.

intact.

small

Today

less self-

ation.

All'this

reverses,

inflation.

with

the

directs

towards one trend, fur¬

economy

ther

the

Anybody familiar

reports

Federal

the

Reserve Board knows the astound¬

cash and bank deposits, the
showing $173 billion,

ing

latest figures
the

highest

level

ever

reached.

However, today, the powerful buy¬
ers

are

1932

such

as;

the

Since then

common

peared

longer

individual

tycoons" of the pre-1929-

era.

Our markets

large, is conscious of the

102%

under

way

are

terest.

com¬

this

Early

with

Seaboard

year

its Fbst

refund

able to

next year,

tible issue.

Mortgage

It is considered

perhaps with a conver¬
In any such operation

it would be

stock

the

new

groups

investors

financial

ap¬

horizon

Investment Trusts, Insur-

Continued

page

the

will

bonds

re-

* Prices
to

100%,

plus

accrued

interest.

Wood, Walker to Admit
,

Wood,

Walker &

Co.,

1949) substanti-

ot tne New York btocK ^xcnanSe>

the company has large cash
above

and

over,

those

carried in the balance sheet among

onerous

Additions and Betterment

fund

This

one

of the New York Stock Exchange

admit

will

partnership
of John J.

indenture

bonds and

can

income
only be eliminated

the

Dec.

Tilney

Jan. 1. The Estate

Whipple will withdraw

limited

as a

John

partner of the firm

Specialists in

the

heaviest, if not actually the heav¬
iest, imposed on any railroad in
reorganization. The provision for
this fund is incorporated in the

RAILROAD

SECURITIES

present

Selected Situations

all

Times

by their retirement.
•

Last

year's

results

afford

dramatic illustration of just what

JBJf&mmi

the Additions and Betterment fund
means

stock.

of the common

holders

Reported

common

fore

;

Wall

Street, New York City, members

resources

fund.

from"

plus

possible to reduce the
outstanding ($43,728,000

December 31,
as

ranging

e s

accrued in¬
optional redemption

100%,
For

appreciable saving, 1041/2%

interests costs.

ally

~p rYc

for'

redeem-

was

possible in many quarters that the
Income
bonds may be refunded

purposes

possibility of a world conflag¬ current assets. The advantage in
ration, the prospective enormous getting rid of the present Income
budget requirements due to colos¬ bonds, regardless of any possible
sal expenditures on armaments, saving in interest costs, would be
and consequently increased tax¬ the opportunity to eliminate the

the

investor,

of the Korean

news

spite

which the bonds will be

able"

benefit

fund

sinking

annual

installed

now

bonds

The bonds will have the
of

improve¬

are

4%.

mortgage

first

1974 and $6,113,300.
general mortgage 4V2% income
bonds due 2014. The balance of
the proceeds will be used to replenish the company's treasury for
capital expenditures made heretofore and to provide funds for
further additions and improvements to the property.
due

bonds

yard

diesels

from the

proceeds

outstanding

the

raw

high Tevel '.in

relatively

ments

power.

the

financing,
together with
other;
funds, will be used by the railroad
company * to
redeem $10,000,000

additional

amount

surprising to me that
the market has been holding at a
It* is

at top level in a more

obser¬

what is the market ap¬
praisal of these inflationary con¬

"market

wealth

overall

vation,

materials,
industrial
plant
and
equipment which are functioning

tremendous

Implication

above

diesel

for

heavily

The Market

After

ing^ the real

have

immune

almost

news.

scare

though,

causes through higher taxes,
stringent credit restrictions, etc. An ex¬
cellent article on this subject appeared in
Fortune, December, 1950.

that the market
against

economy

becomes

trusts.

investment

via

done

merits

are

Participation in our in¬

vestment.

pean

and

fihd themselves unable

Backman

Part

those of all Class I carriers.

and refunding mortgage 3/s%*
bonds, series A, dated Jan. 1, 1951
an(* due Jan. 1, 1981. The bonds,
are priced at 100.485%. The group
won award of the bonds at competitive sale on Dec. 19 on a bid of?
99.64%. The issue and sale of the,
bonds are subject to authorization
by the Interstate Commerce Comr.
mission.*
■ v

Southern

the

Kaiser

old

when

managers

2 Jules

better than those of
Region as a whole

appreciably

Versailles and

the

sun," 'as

Thus, labor efficiency port markets created
unemploy¬
to longer hours, the
ment and disorganization of her
employment of less efficient work¬
economy;, brought~incredible' in¬
ers,
increased lateness, increased, flation. In
Germany, for instance,
absenteeism
and
a
higher labor the
rate.

and^ revenue trends

of Seaboard. The trends have been

the Treaties of

due

turnover

economy,

conditions.

suffers

those

traffic solicitahave been partic-

regress, under, wartime

even

tion

tion in traffic

Participa¬

ularly paid dividends.

a period of
result, the general industrial expansion of the southeast has found particular reflec-'

years.

derived from reg¬

income

man-

inequities of

incre¬

company, and plant to plant or
department to department within
a company.
In addition, produc¬
tivity advances are checked, and
may

m,"
a
"place- in the
r

figured on an annual basis. Un¬
fortunately, actual productivity
changes vary from year-to-year,

industry-to-industry,

ularly aggressive over

to change

year-toadvanees in-

American

liberal

productivity. This assumption rests
on the long-term
productivity ad¬
vance

banking group headed jointly
Union Securities Corp. and*
Glore, Forgan & Co. on Dec. 20
offered to the public $22,000,000
of Western Pacific RR. Co. first

produc¬

in
These
dustry insures the continuity of property betterments and the new
our democratic way of life. Whereequipment installed have found
ever the individual is dubious of
sharp reflection in an improved
taking the investment risk him¬ operating status for the road. This
self, the purchase of common stock trend should gain further impetus

wage

economy-wide

year

most

widely diversified

tion departments

productive value accumulated in
our
leading corporations and the

constant

assume

of the

3Vs% Bonds Offered
A

development and

officers, and pension funds,

colonies, her
"Drang n a c h

legal opportunity for
industries suffering in¬
unit labor costs to pass

on.

ments

reasons

World War I—

abnor-'

of history are

main

the

productivity suffers under partial
or
total war conditions.
Second,
there

and revolu¬

economic

of contract clause
price control as a

type
destroy

consequence

often

are

aware

may

causes

Productivity Wage Increases

Western Pacific RR.

ufacturing centers. The industrial

together with growing employee stock-ownership, will cushion
equities and make them a buy cm every break.

wage

This

distinctly possible,

been

some

well

mutual funds, insurance com¬

banks, trust

savings

panies,

for

increases related
to rises in some cost-of-living in¬
dex (usually the BLS consumers'

and political

economic

present

hands of

investible funds in

price index).

the

contrasts

Europe.
Referring to inflation's impact on the stock market, declares
permanent inflationary elements combined with increasing

assumed advances in

The

taxes. If so, further liberalization'
of dividend* distributions appears

ing citrus fruit, vegetable, cotton,

inflationary aspects here with those of the past in

increment, based on
productivity.2

wage

Jellinek

Mr.

wide¬

Even*

for the funds, it is

ting efficiency, the company
should be able to earn more than
that next year even with higher

lumber, and phosphate rock areas

likely to abort effective price con¬
The

Y. S. E.

earlier.

year

estimated that this year's earnings
on the common will reach $12.00 a
share. On the basis of the present
traffic outlook and the likelihood
of further improvement in opera-'

portions of the south, includ¬

tive

Partner, Gilchrist, Bliss & Co., Members N.

spread in important recent collec-;
tive
bargaining agreements, are
trol.

spectively,

Basically, the road appears to be
in
a
very
strong position.
The
territory served by the road em¬

By ERNEST JELLINEK

earnings
amounted
to;
share and after funds

after allowing

witnessed, most
analysts still consider
the
stock as outstandingly attractive.

Democracy, Inflation, and
The Stock Market Outlook

the

totaled $8.56 a share. This
compared with $6.58 and $3.64, re-

Despite the sharp price rise that

income,"

justify

they

was

rail

Unfortunately,

become

elimination of inequities.

additional

has already

ceiling so long as wages are free
to. rise without let or hindrance.

ljave

score.

than

ported
$11.35

the- ing the total for the full year to
$3.00.
*

and

hardship

alleviation

why prices will rise! There
reasons.
Increased

reason

the
major cost in
production,
and prices;
in
wages,

that

this

present price for the shares. For
the 10 months through October re¬

multaneously.
This

satisfaction

earnings

not until the opening quarter of
this year that a regular dividend
granted effective price
was established,
although a total
control flies out the window.
It must be drawn for prices.
To
of $1.50 a share was distributed at
becomes a bitter fable, rather than guarantee the holding of this line/
irregular intervals in 1949. The
a
the two types of contract clauses*
reality.
first two regular quarterly divinoted herein should be deprived
dends were $0.50 each. In the third
Cost-of-Living Wage Increases
of their automatic character. The
1950 quarter this was
increased
If prices were controlled effec¬ controlling authorities
would, of to $0.75 and in the fourth quarter
tively, we need not fear this con¬ course, retain power to act for the there was an extra of
$0.50, bring-

"stand¬

rent

isting legislation requires modifi¬
cation in the light of these consid¬
erations. Some critical danger line

$4.89

"available

so-called

not

persuasive advocacy, these appli¬
cations are likely to be granted.

cur¬

available

reduced

share. Actually, even allowing for
these funds and based solely on

six
considerable
past

labor costs.
and
with
months,
Consequently, wage
price control, rising costs operative.
justification. For one thing, the
be passed on to buyers. rates rise,-increasing further the
active economic controls domes¬
management has shown increas¬
inflationary impact of greater total
tically
to
the front.
Although Business will find itself badly
ing willingness to be reasonably
squeezed, and we shall witness the money incomes. A vicious upward liberal with respect to dividends.
many who are
spectacle of numerous applications price spiral is thereby intensified. In the
eager for price
early days following con¬
to the control authorities for re¬
control are
summation of the reorganization
Conclusion
lief.
less than luke¬
Being based on fact, and
there had been considerable distherefore capable of strong and
It appears obvious that our ex¬
warm for wage
.

lations

the

funds

and sinking
income was

of the outstanding spec-

one

earnings

last year were $8.71

funds.

After

providing

the
be¬
for

C O

25 Broad Street

€0.

New York 4, N. Y.

Telephone BOwling Green 9-6400
Members

Nat'l Assn. Securities Dealers, Inc.

Volume 172

Number 4970

The Commercial and Financial Chronicle

(2443)
tural commodities, and fish.
Be¬ ting the railroads to agree
among
we
have more fishermen themselves
not
only
on
this
and farmers who are voters than
problem, but on a great many
we
have
other problems.
railroadmen, this ex¬
In other

Railroad

Problems,
Management and Securities

cause

—

words,

emption
farmer

could

man

Senior Partner, McGinnis & Co., New York City
Members of New York Stock Exchange

The

talked

the

that

Association of Customers Brokers

ever

try

sponsoring
today. The

first

this

meeting

1942,

1944

and

railroad

good passenger volume.

very

b le

p r o

m s

the

conclude and

securities

.and

low

priced

that

-could

Patrick B. McGinnis

draw

conclusions

say that is the end
speech.
The railroads are
going
to
have a tremendous
amount of gross business, and sub¬
ject to taxes, they will earn a lot
of

cheap,

were so

with

al¬

curities
some

called

have

problems of the industry.
In 1940 and 1942, during those
talks that I gave, I had at one
time
over
$5 billion worth of
■"merchandise."

had

value

By that I mean
billion worth of par

the obligations
receivership or

bonds,
in

railroads

of
in

bankruptcy.

During the
of

should advance.

they

been

con¬

tinue to do.

and

war,

War

any

not

since the
of those

II—all

consequence,

in 1942, when I was run¬
ning the classes in the N. Y. Stock

reorganized

operating under the
2ations.

with

new

Central,
and

are

capitali\

the "merchandise" we talk
today, with those two

ex¬

in competition with
the other "merchandise," such as
industrial
stocks
and
utility
is

June

Since

have had

est

unfortunately,

25,

tremendous inter¬

railroad

securities.

Per¬

should put it the other
The public has developed a

haps

way.

interest

tremendous

securities

for,

recommend

World

unfortunate

accelerated

than diminished.

rather

And there is

question but that once again the
railroads of the country will be
required to do what they did from
to 1945 and carry, perhaps,
high as 90% of the military
personnel, and as high as 90% of
the freight-ton-miles.
1942

the Office of Defense

was

Transportation in the last war and
have something to do with it in
this war.
We are anticipating in
1951

volume

billion

ton-miles,

freight

750

which will

greater than any of the war years
in World War II.
I think the pre¬
vious high was in 1944, when it
hit

something like 735 billion ton-

miles.

have

for

business

since

June

has

created

profits for the railroads which,
naturally, has drawn your inter¬

cut, and the interest of your cus¬
tomers, so that, including the mail
pay,

1950 will

year

The

tory.
earn

Class

the

third

railroads

best
will

this year,

pay, around

including the mail
$725 million net in¬

come.

had

was

in 1942.

Except for

defines

carriers
There

commodities

these

problems

railroad securities have had since
have

been

the

Street

and,

really, since 1914.
Fortunately,
when

the

some

kept

people's

other

*From

the

address

Association

City,

Mr.
of

Dec.

McGinnis

Customers

13,

rates, but

our

They go in and
They take all

rate.

how

for

me,

empt carriers

the

and

bunch of fly-by-night ex¬
truckers, who have no re¬
sponsibility, in my opinion, who
don't disclose their rates, and the
only regulations they are subject
to—and there is a lot of question
about that—are weight laws and
police powers, such as speeding.
Congress cannot let this go on
are

ex¬

have 150,000.

nevertheless, this exempt carrier
has

come

up,

and this

end

empt

it swept the country,

exempt carrier has been

particularly

effective

the

war—1945.

carrier

cultural

since

has

commodities

the

The

stretched

ex¬

agri¬

fish

and

ently defied almost
I

see

thing to

all

clams,

smoked

fish, kippered fish, and
kind of fish; agricultural

commodities

now

means

oranges

frozen

and

fruits, and this, that
and the other thing, to the point
where, in 1946, for example, the
truckers

got

Florida

about

business.

citrus fruits and

16%

That

1950,

know

Norfolk

cash crop,

great deal about this
because a year ago,
Southern lost its big

and

exempt

takes

trucker

for

advantage
a

return

load.

not

the

the fisherman, but

and

lug

Diesel

from the books.

railroad

man

removed

and

let

So, my
umbrella
make

with

have

I
I

That

bulk

what

and

North

Carolina

something

else

and

always

farmer

will

miles

engine,

be,

and

there

of getting around it.

one

does

be¬

4500

retail carrier.

way

he brings

takes

his

concedes

the

Every¬

railroads

rate is the boxcar,

but

did that.

from

New

Within

had

the

York

and

does

He
as

picks

and
he pleases.

chooses

don't hear much about
of the difficulties,
and perhaps the great difficulty,
Now,

this.

see

you

But

the

one

American

railroads

them, is the difficulty of get¬

This advertisement is under

for sale,

T^ot

some¬

change

or as a

are

for

rates

matter of fact, the ICC says
to go out and adjust our

competitively.

with

our

the gondola.

contract

carrier

last

the

circumstances to he considered

finding

four

as an

they

their

Macy & Co., Inc.
Common Stock
Without Par Value

of
I

heads

will

eventually get
together to try to
solve these problems as I see

Price

$32

per

them.
Problem

first

"Exempt

great

Carriers"

problem which

the railroads have is the problem

"exempt carriers."

There

Copies of the Prospectus
several Underwriters

may

be obtained in

may

any

State only from such of the

lawfully offer the securities in such State,

are

three parts to the law—the Inter¬
Commerce

rails,

Part II

Act—Part

for

LEHMAN BROTHERS

for motor carriers

and Part III for water carriers.

the sections of Part II,

motor

carriers

carriers,

carrying

excludes

agricul¬

December 20, 1950.

out

offering of these securities

five

the

and

Water Carriers Competition

117,692 Shares

small

the management
American
railroads.

think

1950. motor

can yon

trucks—

solicitation of an offer to buy any of such securities.
offering is made only by the Prospectus,

my own.

into

several

the

How

do that when you don't know
rate is on the contract carrier,

~Njew Issue

R. H.

And

Now,
as
to
water
carriers:
which are retail carriers—operate Everybody says it is cheaper to
ship by water than it is by rail.
under bulk rates.
So, in Part III of the Act, in which
We have a man who ships 100
the water carriers are controlled
cars product a year.
He gets the
—so-called controlled
they say
same rate for 100 cars as he does
that a ship which carries no more
for one car. We take it anywhere
than
three
is
ex¬
commodities
in the United States, at any time
empt from the regulation.
You
that he wants us to.
No matter
have few ships in the business to¬
what it is.
The contract carrier
day that carry more than three
does what he pleases. In the first
Continued on page 37
place, he makes an agreed or bulk

North

like.

No contract carrier could

have moved, perhaps

years groups

agreed rates.

—

Carolina.

fall

compete with that.

ever

rate.

The

in order to do that and not violate

ucts

One carload is

back

truck,

as a

see

chips

would

everyone.

the

attempted on

The

rather

the

suggestion is to take the
away from us, and let

rather proud of the suc¬

cess
one

personally

would

where they may.
We cannot go on forever, having
the contract carrier take our man¬

We are bulk carriers.

The truck is

only

And he

contract carriers, the ex¬
carriers,
and
the
water
carriers, or it should be removed

the railroads

thousand

one

horsepower.

trucker.
The

the

empt

carry

are

hind

potatoes, to the exempt

problem,

it, I have had

bulk

told, time and time again,
we would put every contract car¬
are
your bulk carriers.
There is
rier
out
of
business
tomorrow
no question about it.
We are bulk
They
carriers. We can put 50 tons in a morning, if we did that.
could not compete with us if we
car, and put 150 cars on a train,

they got 51%.
personally,

expect

sudden

Problem of Contract Carrier

the

then

The second great problem is the
contract
carrier.
The
railroads,

included

forth.

management of several railroads,
and I

make

to ufactured and miscellaneous prod¬
the whole ucts with his agreed bulk rates.
load, as they will have to do over It is completely uneconomic. We
the next year or two years and are the bulk carrier, operating at
retail rates, and he is retail car¬
perhaps longer.
rier, operating at bulk rates. »
and

include almost everything.
It includes fish, oysters,
any

empt

But,

analyses of the problem
a

your products.
long? Well, as long as
sign the contract—five,

the solution of which has appar¬

rail rate, be¬
published. So

boys did
the other

reading

and it continued to be

One

•

Brokers, New York

has

they know

the

was

talking, fortunately,
1945, about railroad securities.

not.

That

has

eventually present the problem as tracts with the big shipper, yet the
simple as that. The farmer gets law allows contract earners to do
no benefit from this and the fish¬
just that.
Now, I suggest that the law of
true
that
the erman gets no benefit from it. The
carriers
have only person who gets any benefit, discrimination should be applied

stopped

But

railroad.

cause

The
I

other

knows

registered with the ICC.

are

concerned, it is
20,000
registered
250,000 power units

perhaps

trying to find some
solution to this railroad reorgani¬
zation
problem, railroad
credit
had reached its lowest depths in
history.

shipper

and

grew

Therefore, I have chosen "rail¬
the law, he hires out himself and
problems" as I see them, as
his truck to some other carrier
not today's problem, but the real
which has the right to take prod¬
problems that the railroads have.

For

the

would not
there is no way of
it by the device of "trip-leasing." bulk carriers, but we are operat¬
here today.
what the rates is?
He brings a load of potatoes from ing under retail rates, because our
me to

would, perhaps, end these terrific
cycles of valleys and peaks which

the

not know their rates.

consequence

road

way

is.

pleasure for

and I am sure it would be
pleasure for you to listen.

solution

practical

We don't know

is, and there is no
to find out what it

40,000 exempt carriers.
So far as motor-power units are

the

rate

any
effect on some other
carrier and the application of this
rule might be of no

fish

his

been our difficulty,
I think, in you will
getting the railroads together, so 10 or even 20 years.
as
to appeal to Congress to put
Now, the principle that appar¬
Congress had in mind
the thisTaw back the way it was in¬ ently was behind this originally
tended.
farmer and the fisherman.
And, it would be very was that the railroads
The
cannot
section
is
now
abused
by the simple. Simply allow the farmer, make a bulk rate, because it
fisherman, to carry his would discriminate against theexempt carrier.
The exempt car¬ or the
rier now, according to the ICC produce to the market. I would be small shipper. That is the
theory.
The difficulty in the law is that
figures, has reached a total of simple as that.
40,000.
And I think that the new group they did not apply it to the con¬
Now, when you think
about that, you begin to wonder. —and I think most of
you know, tract carrier. They wanted to pro¬
There, are only 20,000 common generally, whom I speak of, will hibit us from making special con¬

define

before

fish

back

I
talk

reason

situation,

agreed

state

The greatest year the railroads
ever

do so,
no

financially in railroad his¬

because

Frankly,

the

It would be no

slowly,
Already the effect of increased

rails,

II.

War

could not recommend rails today,

railroad

reason—the Korean crisis—which
appears

recognize

lot of my former students who
here.
It was no pleasure for

The

stocks.
'

Institute.

Exchange

Korean

Wisconsin

and

ceptions,

does

appeal to me, any more than

except

<; So
about

approach

did

Pacific

been

that

However,

the exception of two, the Missouri
have

that is what
doing and will

extent,

are

war—World
roads

Therefore, all rail se¬
And, to

of money.

them

about

most complete disregard of the so-

•we

tremendous
probably a

So, with that statement, I could

.because

will be necessary because

concern

about

the

net

they will carry a
freight volume and

say

much

gross rev¬
income.
For the

future, certainly next
and the year after no such

year

not

and

enues

about

worry

industry is

foreseeable

1942,
I
have

•did

the railroad

In 1940

and

indus¬

any

Act

what

have

the

directly from the water.

Earnings Outlook

Normally, our great

also

1945.

can

The

As much

had.

be protected, they are pro¬
tected against excess profits taxes.

next time was

was

1940.

probably

will

pretty close to the best year they

that

this

year,

fish

something the farmer
took to the market.

improved and efficient railroad management.

his

fisher¬

He goes up
and makes a rate.

while this problem might serious¬
ly affect the Seaboard and the
Atlantic Coast Line, it might not

and

tried

Reviews legal discriminations against railroads, and

when

dates

ous

pigs

taken

public
interest in railroad stocks in the wake of Korean crisis, de¬
plores "terrific cycles of values and peaks in railroad secur¬
ities," and says they can be eliminated by legislation which
would place railroads on equal basis in competition with other

Last night I looked up the vari¬

take

that

his

market.

Rail securities specialist, after commenting on increased

calls for

put
carry

grain to the market and

J?y PATRICK B. McGINNIS*

carriers.

was

could

rate.

The Commercial and Financial Chronicle

(2444)

for setting up a
Navy and Air Force

Thursday, December 21, 1950

...

arrangements

Tinman Announces Defense Plans
In radio

address, Chief Executive says nation is in grave danger
of emergency, together with military

Europe. The defense of
of the utmost impor¬
tance to the security of the United
is

States.

and civilian goals to be attained in struggle against Communist

assistance
and

Charles

of freedom.

free

parts of the

their defense
our

European

other

provide

countries,

countries

world, because

also important

defense.

own

We are a tolerant and
The Communist rulers are try¬
restrained
people, deeply aware
to Ihe nation in which he stressed of our moral responsibilities and ing their hardest to split the free
nations apart.
If they should suc¬
deeply aware of the horrors of
the
grave
ceed, they would do staggering
war.
danger arisdamage to the cause of freedom.
We believe in settling differ¬
ing
from
Unity with our allies is now, and
C o m m unist
ences by peaceful means, and we
must continue to be, the founda¬
a ggression,
have made honest efforts to bring
'President

Harry S. Truman on
Dec. 15 delivered a radio address
-

also

and

vealed

tinue those

meas¬

taken

about disarmament.

re¬

already

ures

and

believe

his

There

proclamation
of

dress

President Truman

Working together, the free na¬
can
create
military forces
strong enough
to
convince
the

tions

and

those
cannot

peaceful
take

But

Soviet

settled

honorable step we

will

the

to avoid general

can

of the President's ad¬

free

We will continue

means.

every

the

war.

not engage

ap¬

peasement.

talking

you

tonight

tions

the

Union.
five

For

years

been

have

working for peace and justice
among nations.
We have 'helped

bring the free nations of the
world together in a great move¬
ment to establish a lasting peace.
to

Against this movement for peace,
rulers

the

Union

Soviet

have been

waging a relentless at¬
They have tried to under¬

tack.

are

to be

for

peaceful

settlements.

Working together, we hope we
can
prevent another world war.
In

The world learned from Munich

Always Ready for Peaceful

order

succeed, we in our
a big job ahead of

must

Defense

why
do

third

the

meet

Program

present

as we have al¬
danger is to step up our own de¬
been, to take part in efforts fense program.
to reach a peaceful solution of the
We are expanding our armed
conflict in Korea. In fact, our rep¬
forces very rapidly.
resentatives at Lake Success are
We are speeding up the produc¬
taking part in just such efforts
tion of military equipment for our
today.

ready,

are

ways

not

whether

yet know

the Chinese Communists

are

settle

Korea.

conflict

the

negotiations
shall strive for

are

for

our

large Navy.
powerful Air Force.

We
We

and

allies.

will¬

ing to enter into honest negotia¬
tions

forces

armed

own

pos¬

have

have units around

which

strong

Army can be built. But measured
sible, we
a settle¬
mine or overwhelm tne free na¬
against the danger that confronts
ment
that will
make
Korea
a
tions, one by one. They have used
us, our forces are not adequate.
united, independent and demo¬
threats and treachery and vio¬
On June 25, when the Commun¬
cratic country.
That is what the
lence.
Korean people want, and that is ists invaded the Republic of Ko¬
In June, the forces of Com¬
rea, we had less than one and a
munist

imperialism broke out into
warfare in Korea. The United
Nations moved to put down this
act of aggression and, by October,

what the United

Nations has de¬

had all but succeeded.

Then, in
munists

November,

threw

the Com¬

their

Chinese

armies into the battle against the

free nations.

this act, they have shown

that they are now willing to push

.the World to the brink of
eral

war

gen¬

get what they want.

This is the real meaning of the
events that have been taking place
in Koi'ea.
•
-

r.That

why

,we

are

such

?The
pends

civilization de¬
what we do—on what

future

our

families.

Guard

The

danger we face exists not
on
only in Korea. Therefore, the sec¬
do now,- and in the months ond
thing we are going to do
is
zJtead.
to. increase our efforts, with other
fiiVe have the strength and we free nations, to build up defenses
m&Ve the courage to overcome the
against aggression in other parts
of the world. In dealing with the
p must act calmly, wisely, and Korean Crisis, we are-not going to
folutely.
,
ignore the danger of aggression

thger that threatens our country,
Outline of. Program

and

women

the

who

to c5all. **'",

ly,

will build up

our own

Navy and Air, Force, and

due Dec.

1, 1980, at 102.542% and
The
offering

interest.

accrued

Ike more weapons for ourselves
Sid our allies. *
.

under

the

selective

tem has been

ceeds of this issue
the

toward
tion

I fourth,

will expand
Kmomy and keep it on an
we

our

even

pel

[Now, I want to talk to you about
iph

one

of these things.

are

service

■

of the

29,

sales

and

cal

amounted

fis¬

1950,

31,

$89,313,099, surpass¬
previous records.
This

all

with net sales of $80,year ago.
Net earnings

compares

377,977
for

Co.,

the

for

Oct.

ended

the

year just
ended totaled
$4,271,041, equal to $8.08 per share
on
the common stock, as against

$2,543,052 a year ago, equal to
$4.84 per share.
The company's

manufacturing
operations are
separate

ceeds

construction.

The

pany's franchise stores
64

...

now

the

Oct.

num¬

The

year.

book value per common

$52.62

com¬

stores having

new

been added during

com¬

Nov.

record

entire

financing to
15, 1951, of
the 13,301
shares of outstanding
5% convertible preference stock,
with the balance going to the gen¬
Jan.

eral corporate funds which may be
used in part to retire the series
A

convertible

$1.25

preference

stock.
*

Louis-Sail

Francisco

Ry.

competitive bidding
issue of $5,595,000 2%% equip¬

ment trust

certificates, series H, to

Halsey, Stuart & Co. Inc. and
sociates

their

bid

as¬

98.53%.

The

certificates, were reoffered on
15 at prices to yield from
1.75% to 2.65%, according to ma¬
turity, will be secured by approxi¬
Dec.

mately $7,014,235 of new standard
railroad equipment. They
will mature annually Dec. 1, 1951
to 1965, inclusive.

gauge

conducted

now

Missouri, Illinois, Indi¬
ana,
Tennessee,
Arkansas
and
New York.
A new distributing
plant in Trenton, Tenn., is now

ber 482

the

the retirement

plants located in the

under

price to

warehousing
in

and

initially

Dec 14 sold at

Shoe

Brown

subsidiary

year

ing

same

stockholders of

St.

Net

portion

offer which expired on Dec.
14. It is proposed to use the pro¬

1954.

Walker

Nicolaus

Co.,

participated
offering
on
Dec.
shares of

Stifel,

o£ St.

in the public
5
of
150,000
stock

common

(par $1)

Fanner Manufacturing

Co.

$12 per share. The proceeds did

not

to the Fanner company

accrue

but went to

selling stockholder.

a
*

Inc.,

Louis,

of The

and

both

Co.

was

31, 1950, compared

Ilussman

Refrigerator

St.

Co.,

with $39.41 a year before.
A spe¬
cial dividend of $1 per share has

Louis, Mo., has sold to Penn Mu¬

been

delphia,

declared

the

common

stock, payable Jan. 2 to holders of
record Dec. 15.
On Dec. 1, last,
quarterly dividend of 60 cents
share was paid, as compared

per

with

ters.
in

cents

The

special

previous quar¬
dividend paid

January of 1950
share.

was

cents

tual

Life

Insurance

Pa.,

$100

Co.

Phila¬

of 16,000
value 4t&%

issue

par

cumulative preferred stock at par
and

site

dividends.

accrued

ceeds

are

Louis

St.

proposed

The

to be used to
on

which

construct

pro¬

acquire
a

Edgar

ware¬

house.

announces

Missouri-Kansas-Texas RR. has

President

Rand,

International

Shoe

that

Co., St: Louis,

sales of the

com¬

for the year ended Nov. 30,
1950, totaled $198,657,900, or 4.6%.
over the previous year's level of
$190,003,486. The increase in sales
during the final six months of the
pany

just

year
the

closed

15.8%

placed

half.

scheduled

for

the

according

1951,

sales

consisted

solely

ments.

the

1950

of civilian

Morfa,
n

page

MEMBERS
MIDWEST STOCK EXCHANGE

year

Stix

ship¬

$5,000,000

over

national's

Diesel
which are
by July,

new

above

time,

present

Continued

the
in
military shoe orders, while Inter¬
has

delivery

Chairman; of the Board.

decline of 7.5% in the first

company

■

orders for

locomotive units, all of

corresponding period of 1949

offset

and I.

Guard

being ordered

in January.

divisions

to active

duty

Simon

were

■

Co. all

SOS

Co.

publicly offered
stock

who

OLIVE

STREET

of St.

St. Louis LMo.

included in the group

underwriters

common

Dec.1 15

17,889 shares of

(par $1) of Ameri¬

At the sam*e time, we will have

in^the

yery,

rapid speed-up in the

and

pro¬

Berkshire' Fine Spinning
Texas Utilities

Mississippi River Fuel
Delhi Oil

Tennessee Gas Transmission
Texas Eastern Transmission
•

half times.

allies, who have shown their Will Produce Weapons for Allies
and their love of free¬
These will not be weapons for
<
...
our
armed
forces
alone.
They

Rockwell Mfg.
Southern Union Gas

Southwest Gas

courage

Producing

Cites North Atlantic Treaty

will constitute

The United States, Canada, and
the 10 nations of Western Europe

defense

arsenal,
weapons

Bought

arsenal for the

are

united

with

the

Out

—

Sold

—

Quoted

who

freedom.

this

will be able to send
to other free nations, to

SCHERCK, RICHTER COMPANY
Landreth Building

up-

per

Louis,

construc¬

the

utility com¬
pany's system.
The program will
require additional financing
through the sale of additional se¬
curities during the period through

sys¬

North Atlantic treaty have ^already add to wha£ they can produce f
their owh defenses.
Arid in thi
begun td create combined military
Id the principles of the United
same
arsenal, we will provide a
defenses. Secretary of State
ations.
Acheson is flying to Europe on large reserve of weapons to equip
additional units in our own armeg
[We have no aggressive purpose, Sunday. He and representatives
dwill hot use our strength for of these hatlons'will complete*the •<
Cdntinued 'on^paQe

[First: We will continue to

pro¬

to be used

are

cost

program

raised, and two ad¬

ditional National

We must stand firm with

dom.

The

oversubscribed.

was

•

our

unsubscribed

the 92,924 common shares

offered at the

Far

nations.

the

sent

mon

fTbird.

Co.,

Newhard, Cook & Co., Edward
part
of
the
process
of
achieving a speedier build-up, the- D. Jones & Co., Reinholdt arid
number of men to be called up Gardner, Dempsey-Tegeler & Co.

military equipment.
East, but Etirope and the rest duction of
First, we will continue to up¬ of the world are also in great dan¬ Within one year, we will be turn-^
held, and if necessary to defend ger. The same menace—*the men¬ ing out planes at five times the,
v fth
arms
the principles of the ace of Communist aggression — present rate of production. Within'
I qited Nations—the principles of threatens Europe as well as Asia. one year, combat vehicles will be.
fj 3edom and justice.
To combat this menace, other coming off the production line at
$econd, we will continue to free nations need our help, and four times today's rate. Within
v
c^rk with the other free nations we need theirs. We must work one year, the rate of production
strengthen our combined de- with a sense of real partnership of electronics equipment for de*
fense will have multiplied fop?
Ises.
and common purpose, with these

are the things we will do:

Baum

City, publicly offered $25,of Union Electric Co. of
Missouri first mortgage and col¬
lateral trust bonds, 2%% series,

are,

000,000

Air Force.

Reserves

including, among

George

•

and

sub j ect

elsewhere.
There ig actual warfare

[Here

and

men

Army, Navy

Meanwhile, our troops in Korea
Today, our military strength has
are continuing to do their best to
reached about two and a half mil¬
uphold the United Nations.
lion. Our next step is to increase
General Collins, Chief of Staff the number of men and women on
of the Arm,y, who returned a few active
duty to nearly three and a
days ago from Korea, reported half million.
that our military forces there are
I have directed the armed forces
well organized and well equipped,
to
accomplish this as soon
as
forces, together with their com¬
possible. The Army and the Navy
rades in arms from many nations,
will be able to do this within a
I am confident that our military
few months.
It will take the Air
will continue to give a good ac¬
Force somehwat longer.
In addi¬
count of themselves.
They know tion to these men and women on
they are fighting for the freedom active
duty, we have about two
and security of their own homes
million
more
in
the
National
and

grave danger.

million

half

cided they are entitled to have.

open

of under¬ can Investment Co. of Illinois at
Stuart $17.50 per share. The shares repre¬

group

Inc., and

States

thing

Kansas

That

Solution
We

Kremlin

Setting

the
things we believe in, are in great
danger. This danger has been cre¬
ated by the rulers of the Soviet

common

position to negotiate successfully
with

yr -*

Our homes, our nation, all

na¬

by strength, which

necessary

country have
about what our country
is up that
security cannot be bought by
us.
against and what we are going to appeasement.
do about it.

the

present

can

front, backed
is

Co.

others,

Inc.

Working together, the free

the

between

Dec.

writers headed by Halsey,

can¬

inevitable.

interests

that

follows:

conflict

Union

signed the
following day.
text

war

world

Emergency
whic h
h e

The

efforts, but we cannot

that

legitimate

National

effort.

our

con¬

Though the present situation Communist rulers that
they
is highly dangerous, we do not
not gain by aggression.

it, in-

cluding

tion of

We will

yield to aggression.

taken

combat

aggression.

continue

will

V/e

aggression. Establishes new Defense Mobilization Office, under
E. Wilson, as Director.
Pledges rebuilding arsenal

Missouri Brevities

defend

Europe

reveals declaration

and

joint Army,

Bell Teletype
SL 456
.

...

St. Lours 2, Mo."

Garfield 0225
L. D.,123

Volume

172

Number 4970

The Commercial and Financial Chronicle

113

(2445)

But

Connecticut Brevities
Bigelow-Sanford

Carpet

The annual report of The Plastic

Com¬

Wire

is making plans to purchase

pany

Cable

earnings of $0.68

Summerviile,

common

ent

Georgia. The

pres¬

plant employs 75 to 100. Bige-

low-Sanford will take

over

Sept.

30.

During

increased

opera¬

the

44%

ended

the

over

Asserting nation

pre¬

tion of the plant on Dec. 22. The
addition will give the company

vious year. Of the total

greater diversification

rently

about

are

government contracts and

floor

The

Riverside

Hartford

branch
The

Trust

will

bank

branch

new

will

Russell

known

including

teller's window and

ing

Company, which is

Chas. Pfizer &
doubled

op¬

medicinal

and

it-

struction

work

has

Stoddard
creased

tion

authorized

$75,000

Present plans

by from 35
and

capitaliza¬
$250,000.

call for

nectar under

has in

1950

78.8%

shown

:;s

President

Co.

the

tend into

end

will

schedules. '

ating

well

earnings

below

will

considered

normal

will

devoted

Sept.

and

30,

tworking

capital

ernor

Co.

and

million.

share.

$12

Co.

for

have been
the

Britain

New

Machine

increasing steadily

fourth

quarter

1949.

was

than twice

lion.

Stern & Byck Forming
As

Pickering Gov¬

Jan.

members

City.
Byck
IN

Stern

United

tive

the

Henry

States

America

has

become

the

Ar¬

that "One World."

going on not only af¬
fects the ways in which we may
be

able

lives;

about

threatens

our
daily
affect the

human freedoms which Americans
have

always been ready to defend

three

kinds

world

the

over

are

today looking to the United States
the great Arsenal of Hope.

First, there

recover

and

power-hungry

The

only

ar.d

they

speech

through

and

not think

may

action.

talk

freely under penalty of death!

They must think
to

think, speak
speak, act

They

circumstances.

they

peace,

Mr.
of

Ford

the

freedom,

and
We

secret

weapon

—the infinite resourcefulness, the
infinite creative and productive

ability of 150 million free human
beings acting together toward a

popular in

accuse

having
with

quarters

some

the American people of

become

material

preoccupied

things

of moral and

sense

have

spiritual

Such critics miss the point com¬

course

are

and

proud of our

oilburners;

our

and

tell

make

need

known
what

them

before

the

Farm

do to make

can

with
it

problem

best

how

and

right.

dealing

understand

take stock on
equipped I am to dgal
decide what to do, arid
can,

well

with

it,

then

act.

most

After

that—I

suspect

you—I usually have

to start the process all over again.
That is, reexamine the; situation
as
it
may
have
changed,
and
figure out something else to do. h

What
I

is the

don't

over-simplify
what's going ,.on at

but

matters,

situation?

want

moment,

understand

ut-blThis

announcement

jilts')

•»

ganized and well-equipped gang¬
sters

bent

the

loose

making

hell¬

and

World

One

our

world

our

slavery. They threaten
lives,
our
properties, oyr

liberties of

either,

It is

because

munism

the lives and

freedom-loving people
idle

thrd&tj,

organized

with

com¬

headquarters . bin

dish¬

Russia has made itself strongcand

and

bull¬

powerful.

bridges

and

sky¬

our

Furthermore,

are

them,

but

What

with

we
!.

it?,';
-

satisfied

C/;

have

new

milestone

pursuit

Each, in a

ones.
on

the

road

of. happiness.

eliminates

way,

call

our

Each,

human

drudgery and increases what
to

high standard of

got to do about

i../'.

li-U

till

The

answer,

rcan

•

one

hand,

as«simply
have

stay—mighty in mili¬

tary strength to guard

ourselves

against this threat of force. Pru+
dence

suggests that

friends to get
we

won't have to stand
.

hel£ -but*

strong, too,

Continued

so,

that

alone^n
page

is not to be construed

as an offer to sell or as an offer to buy the securities herein mentioned,
The offering is made only by the Prospectus.
%

........

individual floor broker.

Louis D. Stern and Charles Stern

Connecticut Securities

partners

were

which

Stern

being

Brothers

dissolved

103,158 Shares

on.

Dec. 31.

Tim Brothers
Established

1907

Members
.

New

York

New

York

1 r ", -'
,
* ". ■
To Be Whitcomb Partner-•

Boston Stock Exch&nfM
Curb Exchange
(Associate)

Hartford 4

O
.

■

...

Whitcomb & Co.,44 Wall Street,~
New York City, membejs of the

New

New York:

BArday 7-3542
BeU Teletype HF 365
,

>,,V

9 Lewis St.
Tel. 7-3191

York

Stock

Exchange,

~y,

Common Shares
'

h
v

will,,

$1 Par Value

admit William F, Bohner to part¬

nership

Jan. 1.

Price $14.25 per

We maintain:

share
..

Primary Markets

Copies of the Prospectus

Connecticut Securities

states

in which the

securities and in

may

be obtained from the undersigned only
are qualified to act as dealers in
legally be distributed.

undersigned

which the Prospectus may

?{»

Chas.W. Scranton
MEMBERS

NEW

New
New

York:

REctor 2-9377

Bridgeport
'•i

-i I,

STOCK

Co.

EXCHANGE

F. Eberstadt & Co. Inc. ;■

Teletype NH 194

& Hi***,

New London

»*

Shillinglaw, Bolger & Co.
y't b

Haven 6-0171

Danbury

*-•*' -''

YORK

Hartford 7-2669
Waterbury

December 21,1950

it,

is that another bunch of well-or¬

living.

Street, New York

is to

can

wrong

and

scrapers.

right. And
that

The only way I know of

to get—and

National

all

radios

our

dozers;

some

all

know

about what

refrigerators

electric

washers;

smile

"everything is
going to be all right." Sure things
are going to be all right—but.
only

vent

told to

wrong

that

told

looking

Situation

just

when leaders sit back with

everywhere.

pletely.

never

Stock of

seems

liberties—as well

values.

the

goal.

common

Federation, Dallas, Texas, Dec. 13,

1950.

happiness.

our

for
our

are

prisoners

what

do to meet threats

can

what

Arsenal

confidence
seen

Must Take

our

Partners will be Maurice S.*,
and Louis D. Stern, both

rights to basic
people can em¬

ever-widening circle of
and spiritual progress.

moral

free¬

enslave

our

of the

stated. On the

convention

with'

best

seek to make them better and in¬

Bureau

formed

the'

told

annual

away

bettering himself.

are

they

are

address

their

would

We have

automobiles

can

this most priceless of all

thought
But

they

way

possessions

act

who

know

These people have lost their

freedom.

our

lost

the hundreds of

are

ruthless

by
men.

maintain

But

people

it,

see

all

Hope.

with their lives.

people

free

ourselves. We have

2nd

senal of Hope of

What

Ford,

through the occasional slits in the

Exchange members, general part¬
ners, and Charles Stern,
limited
partner.
Mr. Byck has been ac¬

Hartford and

that

today

of the New York Stock

will

for

whittling

telephones and deep freezers and
sets are only a meas¬
ure—though a very good one!-r-

hundreds

are

States of America

♦An

offices at 1 Wall

MARKETS

sult

re¬

Byck,

Exchange,

Bloomfield, N. J.

the

And the

act!

sale

day

of each man's personal

human freedoms, no
bark upon it. And our millions of

effort and

Third, there are the millions
of people who are free and have
been fortunate—people like our¬
selves. We, too, look to the United

the first quarter sales of $2.2 mil'

$6,206^392.,

human

each

Without individual

They are weak and need
time and help to recuperate. They,
too, pin their hopes on us.

"One
B

there

aggressors

live

now

Second,

millions of people in nations ruled

Brush

—

vicious,

der

them.

simple fact of

sep¬

most

pursuit of happiness is slow
enough and difficult enough un¬

they have
been
so
by events of the past
two decades that they no longer
have the strength to stand up to

the matter.

in-

Plans call for

Fuller

$4.9 million

Champlain Co., Inc.

PRIMARY

million

being

The

weakened

that

World."

Connecticut,

$3,536,325

The company has announced
of the business of

Puritan,

The level in the fourth quarter of

compared to

was

51%

its

misery

hope

right to criticize
war

slavish

with

spiral.

wage-pnee

without, freedom

little

iron curtain toward the hope that
is the United States.

dom.

be the

since

period in 1949.

cash

$37

its operations

and

Co.

I.,

largest volume in the
company's history.

Company re¬
ports earnings of $3.91 for the first

same

Island

assets

Sales

Hartford-Empire

$1.99 for the

confined

Rhode

Sales

1950

stock¬

1950, including the cosmetics line,
are estimated at
$37,500,000. This

volume.

nine months of

offering

stock.

to developing
new
designs and
tooling-up in preparation for the
increase

create

to
,

vicious circle

millions of people in nations who
believe in human freedom and are

two

that

arate company.

Con¬

level.

minimum

imately $48

and

what

siderable effort has been

for

oper¬

capacity
below

conflict.

happened

since

the operation of Puritan as

this

the company has been

$1.50

Book value of the stock is approx¬

ex¬

During

rev¬

surance-in-force

1952 under present pro¬

duction

outstanding

has

November.

orders

new

Providence,

which has

Boat

recently revealed that the
company's backlog increased from
$40 million on March 31 to $94
million

Co.

Work

month

business

holders of Puritan Life Insurance

the

Electric

cents

by from

Company

ance

line

the 1949 sales level.

over

The

increase

Connecticut General Life Insur¬

and

rates

month.

offer of

apricot
its Silverbirch label,
juice

prune

rate

about $190,000 a

individual

enue

additional stock to present share¬
holders.
The
company,
which
bottles

Tele¬
a

month. The company proposes to
increase individual residence rates

Brothers, Inc. has in¬

its

from

England

Life

impediment to

into

and what

has

New

increase of 4%

'if.

cold

the

these

Southern

recently been

phone Co. has applied for

con¬

started.

year

Indemnity Co.

defends

still

wars

tional

summer.

out

broken

say

accident business is written by the
company's subsidiary, United Na¬

capacity of

industry,

that

two

may

trite

wars—and

has

ominous

cident department. At the present
time a small volume of health and

increasing demand for
this product by the pharmaceuti¬
cal

world

through

meaning of

the

meet

ac¬

lived

which

war

health and

have

gigantic

Com¬

free

are

television

another

Insurance

has formed

pany

branch.

Co. at Groton will

Fire

existing

has

Co.

and

Deplores strikes

government.

govern¬

yard.

The citric acid plant

being

now

the Portland

8,900,000 yards of
webbing at a price of from

National

organization in task,

for pne
things

chained

must

condemns

order for

cotton

4.625 to 17.5 cents

Portland Trust

merged with

erated

receipt

Earlier this year River¬

area.

side

ment

drive-in
large park¬

efficient

*!•

Manufacturing

announced

The

government
is about $3.5 million.
on

*!*

the Albany Avenue branch and
will
provide
complete
banking

levels.

record

facilities,-

backlog

contracts

second
1951.

its

June

present

Company

open

about

government, but cur¬
60%-65% of sales

volume

to the

were

soft

the

coverings.
*f

forget

have these

mighty military strength; (2) keeping our economy strong,
healthy and progressive; (3) avoiding taxation or any other
action that will kill
incentive; and (4) expansion of production
and technological advancement.
Urges trained leadership for

sales, 28%

not
we

•

organize for long production race against
international gangsters, leading auto executive advocates:
(1)

sales

year,

because

them.

President, Ford Motor Company

the

stock for the year

moment that

By IIENRY FORD, II*

shows

Corporation

the Georgia Rug Mill Inc. plant at

Keep U. S. the Aisenal of Hope!

1
14

The Commercial and Financial Chronicle

(2446)

.Thursday, December 21,

1950

[Editor's Note: For further in¬ Chairman and President of Invest¬
formation

Cashion

Goode

and

ors

Mutual Funds

of Feb.

Diversified Services, Inc.

Net

opinions, refer to the "Chronicle"

2, 1950, page 14.]

assets

fiscal

the

fund

Net asset value rose
at the end of the 1949

year.

Investors Stock Fund

stock,

National Securities

Prospectus upon request■ from
your investment dealer, or from

RESEARCH

Sells Retail Division of

Firm to Ryan, Hall & Co.
Mr.

NATIONAL

SECURITIES

CORPORATION

120 BROADWAY,

NEW YORK 5, N. Y.

Henry J. Simonson, Jr.,
President, has announced that Mr.
Louis
H.
Whitehead
will
join
Securities

National

Research

Corporation as
Vice
d

Presi-

e n

and

member

the

Policy

Committee

Jan. 2, 1951.

White-

Mr.

DIVIDEND

d '

ad¬

vancement

the

position

will

climax

career

that has

included

in
of

experience
all
phases
the

invest¬
Lo;?is H. Whitehead

ment business.

Prospectus from

investment dealer

sole

of Louis H.
has played an
important part in the growth of
mutual funds as a lecturer, finan¬
cial
writer and wholesale dis¬

your

proprietor

Whitehead Co., he

CALVIN BULLOCK

tributor.
Mr. Whitehead has arranged

Established 1894

to
the retail division of his
present firm with Ryan, Hall and
Co., Inc., 165 Broadway, and his
upstate New York, Pennsylvania,
merge

New York

One Wall Street

New

Jersey and New York City
representatives, as well as a por¬
tion of the office personnel, will
be absorbed by that firm.

Knickerbocker

®
^®|r

1 Fund
i=

for the

Diversification, Supervision and
Safe-keeping of Investments

'gg

tmmmm

Prospectus may be obtained from
your investment dealer describing
the company and its shares, includ¬
ing price and terms of offering,
KNICKERBOCKER SHARES
20 Exchange Place

INC.

Morton M. Banks and Frank J.

Holcombe, Jr.,

at present whole¬

sale representatives of Louis H.
Whitehead Company, will acquire
the wholesale business of the firm
Jan. 2, 1951, under the name of
and Holcombe,
44 WaR

Banks

making

the

announcement,

stated

Simonson

that

assistance

the

voted

retail

throughout

dealers

country,

the

saying, "His broad and
experience as an an¬
proprietor of a retail

successful

alyst

and

firm qualify him for
we

are

means

are

distributors

Vice-President

vacated

Research

National

Corpora¬

the retirement of
Vice-President Douglas Laird, one
upon

of the founders of the corporation

in 1930.

to his

respect
affiliation, Mr. White¬

new

head stated:
"Mutual funds have become the
most

INVESTMENT FUNDS
investing their capital

dynamic division of the in¬

vestment

changes

business.

social

conditions

created

BONDS

services

PREFERRED STOCKS
(Series K.1-3C2)

provide

great

and

economic
occurred

generation have

definite

that

The

have

that

during the past

(Series B1-B2-B3-B4)

satisfactorily.
dealer
for

the

Corporation

spell progress

spbnsor.

"I cherish the many friendships

activities with

gen¬

uine pleasure."
Mr.

Whitehead obtained

his

need

mutual

for

funds

Wharton

training

School

the

Finance

and

Administration.

"Within

investment

$17,664,660

6,400

12-14-49-

Aessts

1,227,854

rose

76,000

from
share¬

890,162 shares held by more than

89,000 shareholders in 48 states,
Alaska, Hawaii and
15 foreign
countries at the close of fiscal 1950.

1950 the company re¬

For fiscal

ported

income

net

exclusive

investments,

1949

net

$8,562,602,

realized

net

1.030.685

13,321,329

17.2';

Asked

32.6%

19.1',;'

how

prospects of the

pares

feels

about

company

the

for the

gain

with
$7,115,915, a.

compared

income

department pre¬
"Summary of Economic

Trends" reflecting the consultants'

opinions and viewpoints. At sub¬
sequent investment management,

meetings

the probable

these trends

impact of

the nation's

econ¬

omy is measured and decisions are
coming year, Mr, "Bradford re¬
made with respect to division of
plied that he did not believe in
the Investors Mutual portfolio by
making financial prophecies at
security classifications and the di¬
any
time—much less today.
He
versifications of portfolio invest¬
added that in this connection the
ments by industry classifications.
Fund is fortunate in having In¬
vestors Diversified Services, Inc.,
First Investors Files
as
investment
manager
because
First Investors Corp. (New York
the very size of its operations re¬
quires it to be so much better investment company) on Dec. 14

category

the

alone sufficient to

ket in Canada has been allowed to
a

mit Canadian

Canadian

rearmament

duration.

At the

the

tion

now

level of business

slackening, leading Canadian banker advocates, immediate
inplementation of a well-integrated immigration
policy as means
of enlarging nation's labor force.
Commends decision to

sufficiently-

Mining

Turning

sign

the Canadian economic and finan¬

U. 'S.

the

Stressing Canada's rapidly expanding economy,
accompanied
by intensified rate of capital investment which shows no

that

doubt

iron, each of which is ex¬
pected to play a prominent role
in maintaining our
present high

Bank of Commerce

have

transactions in securities.

dollar in the

be repatriating

would

Board restrictions that have given
rise to the multiple markets for

U. S.

year

President, The Canadian

been

the

pres¬

sure.

had

opportunity to abolish
Foreign
Exchange
Control

the

Following the initial

when

movement

hoped

dollar,

No.

oil and

The first phase of the freeing of
the Canadian dollar has

Agree¬

price

this

minimum

electrical

good gauge of indus¬

activity and the increase of

7 % during the elapsed part

of the
present year reflects fairly well
the general position.
The com¬
pletion of new central electric in¬
stallations

months

within

has

made

Continued

the

past

this

increase

page

The Commercial and Financial Chronicle

(2450)

Continued

Canada's Expanding Economy
Faces War Conditions

JOHNSON

possible

in the securities
Trading is usually active with cross¬

markets at this time of year.

for

demand

but

power

with and,

continues to keep pace

indeed, exceed that available.
International Trade

find

who

those

This year we

have witnessed a
activities.
Our surplus in merchandise trade
of two hundred and twelve mil¬

valuations

year ago

last Septem¬

1han

10%,

trade

Canada's

attractions

somewhat

the

lower

served to in¬
exports to that country.

Canadian prices, has
crease our

Canada to cushion

The ability of
the effect of

decrease in exports

sterling countries by an
increase in exports to the United
States is another evidence of the
the

They have long records of successful operations and

adaptability of the Canadian econ¬
omy.
At this time our newlydeveloped trading pattern is oper¬

trends toward greater use of insurance

ating under the forces of the free
dollar market and it is hoped that

coverage

should

also continue

and

help to provide a

existed in world trade under con¬
ditions of rigid

during the past two years most of the stocks tare still con¬
servatively priced on a statistical basis. The substantial under¬

group

also

that

fact

the

ings

result of

by a more aggressive
of funds to buy common

capital

improved

those which participated
in previous discussions.
The fact
that Western Germany is one of
these newcomers may increase the
beyond

investment policy. For example, the
stocks rather than short-term Govern¬

ment securities has been made in a number of cases.

First of all, the yields

common

stocks, there

Phenix has for

some

are

number of such companies.

stocks.
even

course

resent

effort

concerted

nations

world s commerce.
'

*■

trade

possibilities in the Ca¬
nadian
economy.
Total invest¬
ment by nonresidents in Canada
long

run

the

end

amounted

1949

of
five

dollars,

billion

eight

nearly

which the greater part, some

billion nine hundred million, was
held by

Americans. Since then the
attractiveness

continued

Ca¬

nadian investments has brought in

additional investment funds
United

the

which
the

This

States.

from

inilow,

particularly heavy in
last,

was

three months after June

indicated

the

for

most

part

growing realization by Americans

Other companies in the group

have similar features and in some
provide greater, yields. In many cases these securities will meet

investment

Canadian

oppor¬

tunities. Yet this inflow stimulated

inflationary

and should be

and

considered during the current period of portfolio adjustments.

pressures

method

some

in Canada

was

necessary

whereby inflationary pressure en¬
gendered by speculation about the
value of the Canadian dollar could

Developments

tal

of INDIA,^LIMITED
Bankers to the

list

dividends

cash

capital changes in recent

years.

Office:

26,

London,
Branches

Copy

request

Laird, Bissell & Meeds
Members New York
Members New

York

Stock Exchange
Curb

Paid-up

own

Reserve

Capital

The

Bank

Fund_.

and

Teletype—NY 1-1248-49

£2,000,000
£2,500,000

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

Specialists in Bank Stocks

and

same

develop¬

maintained.

world

which

finds

both
of

now

price in terms of other cur¬
was
one
with many im¬
and

much

com¬

latest

ourselves and

for

military preparedness; full

the

Honor Carl Marks

budget,

co¬

Defense

lantic

Pact,

amount

dollars

lion

defense

the year,

it.

this year

history,

witnessed the meeting of
for
the
purpose
of

considering
program

extensive military

unaccompanied

declaration

war.

The

by
a
supple¬

testimonial dinner

which, together with

Astoria Hotel

Waldorf

the

25th

tional

Product.

months

nine

High

income

national

sulted in

the

York

levels

1925,

sizable budgetary sur¬

foreseeable

the

t ria n

other

passed

measures

The

session.

tral

Essential

essential

materials,

the Consumer Credit Act
of

control

the

terms

goods

These

credit.

foreign securities

permits
which

the

used

available

themselves

inflationary -tendencies

bank

cover

■

; Canada—United States Military
Integration
It is not unlikely that history

will
Washington Agreement

record the

which

occurs

by Canadian and American

representatives
does

October of

outstanding

The signing of the Agree¬

rence.

ment

signed

was

this year as an

Washington

than reiterate the prin¬

ciples contained in the Hyde Park
Declaration

The

1941.

new

avail

may

These

brokers.

information

are

information

this

through the medium of their

they

appear.

are

institutions

financial

only, the general public

the
defense program and on the other
hand they may be used to combat
goods

ev¬

in the world

transactions

Although the firm's services

two

city

possible.

hand they may

one

divert

have

added, and

were

securities

where

upon

Acts'

important

ery

and

purchased

are

prosper

correspondents established in

mark-up, production and distribu¬
tion

coun¬

continued

company

until depart¬
ments covering the entire field of

with
prices,

the

control

power

time

activities

1930s

American

South

The

expand and

Materials

Act provides the government
the

early

the

and

tries.

special

the

that

broadened to cover the Cen¬

were

get are the two important control

se¬

and

active and fluctuating wide¬

ly.

the

light of the provisions of the bud¬

European

which

currencies,
were

considered

and

Central

curities

lic.
be

Marks

Carl

additional taxation upon
corporations
and
upon
certain
classes of goods used by the pub¬
impose

epreciated

German, Aus-

re-

mander for the year, the Minister
of Finance found it necessary to

Also

its

dealings to

disburse¬

cash

defense during

for

first

confined

plus on the then existing bases
taxation, but in order to cover

ments

firm,

founded

had re¬

year

Co.,

City.

The

first

the

during

Inc., 50 Broad
Street, New

million dollars, or about
the estimated Gross Na¬

twenty

of Carl

Marks

and

hundred

four

anniver¬

sary

bring the total commit¬
approximately

billion

to
the

celebrate

ment lor defense to
one

given

was

by his entire office
staff and their immediate families

to Carl Marks

expenditures authorized
main estimates earlier in

the

Firm's 25th Year

behalf

partners of the North At¬

our

own

services

foreign

ex¬

change regulations, quotations, in¬
trade

ternational

subjects such
*

and

associated

foreign taxes, etc.
The firm has acted (directly or

indirectly)

almost

every

case

where there has been repatriation,
of
foregn government, state or
municipal securities, and in nu¬
merous
cases
where corporations

have

repurchased their own secu¬
bpbri market.
commenting on the firm's

rities in the
In

Mr.-Marks

success

attributed it

that he

stated

simply to the firm's

high ideals, equitable policy and
reaffirms the prin¬
fair treatment of employees.- From
ciple of co-ordination in defense
an
insignificant start the firm's
purchasing and allocation of ma¬
capital and surplus has grown to
terials between the two countries.
more
than
$4,000,000.
Sales of
It also indicates that, in so far as
securities are running at the rate
defense
expenditures
are
con¬
of $60,000,000 per annum.
cerned, problems of foreign ex¬
*
♦
change and restriction of purchas¬
Agreement

•

ing

ability

ordination
well

may

which
in

the

hindered
postwar

be avoided.
The Outlook

enter

program

ferent

into

co¬

period

Opened in Boston
American

preparedness

under conditions far dif¬
those of the
early

We know

that manpower and resources are

utilized

and conse¬
quently the diversion of men and
material for military production is
bound

pansion of

cause

strains.

our economy

American Sees. Branch

..."

from

fully

-it

...

days of World War II.

being

Parliament
-

us:
eco¬

the

For

itself.

the

under

From

situation, the decision to per¬

For the first time in our

every description ot
exchange business

undertaken

the

Preparedness Programs

Trusteeships and Executorships
also

could

mend

£4,000,000

Telephone: BArclay 7-3500
Bell

investment

plications

conducts

btnkir.g

rencies

Zanzibar

Capital

while,

mit the Canadian dollar to find its

Bishopsgate,
E. C.

Exchange

120 BROADWAY, NEW YORK 5, N. Y.
i

the

Burma, Ceylon, Kenya
Colony, Kericho, Kenya, and Aden

Subscribed

situation

critical

the choices available to cope with

in India,
and

for

ment

Government in

Kenya Colony and Uganda
Head

relieved,

time, the beneficial flow of capi¬

NATIONAL BANK

Bank Stockholders

light of existing

aspects:

The development of a new

example of difference in investment policies is pro¬
Springfield Fire & Marine. This company has the major
portion of its investment funds concentrated in tax exempt bonds.
Under present conditions, they would seem to be in a particularly
favorable position so far as taxes are concerned.

Of Interest

the

consumer

pattern has caused attention to be
directed to both the short and the

investment and
funds in common

of investors

' *

■

• v-

The Free Dollar

vided by

group

place

conferences rep¬

trading

the

by
i

Another

the particular needs of a-wide

face

conditions

under

Pact.

Defense

greater percentage of total income.

cases

consistent and

unshackle

Fidelity-

the income derived from this source constitutes

series

taken

have

which

the

time emphasized this type of

has close to 50% of its available investment

now

concessions result. The nego¬

tiations

high quality equities have been
around 6% and 7% as compared with lVs% to 2%% available
on Governments. Secondly, 85% of the dividends received is exempt
from Federal income taxes as compared with the fully taxable
status of practically all government securities.
There is also the fact that within the last year many insurance
companies have increased their dividends so that the yields avail¬
able are relatively attractive. Most of the institutions should be
able to maintain present rates under any foreseeable conditions.
Within the group there is a; wide range of choice among the
different companies. Hartford Fire is one of the biggest companies
in the group and is regarded as among the most conservative. It
has a long record of profitable underwriting. Investment policy in
the past few years has been reflected in a very large government
hond portfolio with only a minor position in equities.
Where there is a desire to obtain a security with a large position

panies.

of what¬

significance

and

range
ever

policy has two principal advantages for insurance com¬

This

countries

additional

six

includes

positions

The present conference

Torquay.

larger

Geneva,

conferences at

trade

Havana, at Annecy and now at

institutions to increase their earn¬

have made it possible for some

use

gains
the

interest

We have watched with

the

invested and from higher dividends on equities.

volume of funds
There

favorable

made

have

control wiil stead-,

ily decrease.

writing profits of the last two years, retained earnings and apprecia¬
tion of security holdings are some of the factors that have tended to
increase the assets of the different institutions. Earnings from
investments

position which has

the unbalanced

growth.
spite of the substantial rise in the market price of the general

tasks

continuation

stability

have

uncer¬

Undoubt¬

assistance towards
the mitigation of the basic causes
of unrest and war; and also the

the eight hundred and fifty-six mil¬

level of income in
United States, coupled with
rising

paid dividends continuously for many years. Although the
industry may not participate directly in the defense program,
insurance will continue to be a vital part of our business and
wider

major

three

the

lie ahead.

operation and

Atlantic

defense

have

measure

present, our cash commitments for

surplus with the United Kingdom
has declined. At the same time, a

attention is called to insurance stocks.
The securities in the insurance field are generally high quality

and

role

our

North

the

goods in countries which devalued

of new funds

economic life. The long-term

emphasized

also

signatory

emphasize

ensure

nomic

the United

which
had
the effect of
increasing the price of Canadian
ber,

their portfolios at this time of year for tax reasons as well as those
who are looking for replacements for previous sales or investment

investments.

weeks

recent

that

edly

responsibilities as
Nations.

our

member

expansion of trade which is basic
condi¬ to the maintenance of our welllion dollars a year in the period
tions, the fiscal provisions of this being. These are challenging ob¬
1935-39
and
of
even
yet the record shows
larger supplementary budget might best jectives,
amounts in the postwar years has be described as precautionary, and ability and courage in facing other
the
extent
to
which they may equally
difficult problems that
been replaced by a deficit of fif¬
have to be expanded will be de¬ have arisen in the course of our
teen million dollars at present an¬
nual rates. Since the round of de¬ termined by the outcome of the history.

adjustments in

to make

advantageous

decided change in trade

reduced.
For

Events

served

clearly

brought more

focus

into

December the year is close enough to
the end that investors can estimate what their tax liability is for
the period and in so far as it is possible try to minimize its impact.
This is possibly true to a greater extent in those individual
accounts which are fairly active. However, even in institutional
accounts it is advantageous to reduce the tax liability through
such methods as offsetting gains against losses.
It is not always a case of taking losses which is important in
working out a tax program. Frequently it may be to the advantage
of an investor to accept gains as a means of lowering the tax
liability at some future date. For example, it seems very likely
that personal income tax rates as well as corporate rates will be
higher next year. Thus if one is planning to sell securities within
the next few months on which there are sizable gains it may be
advantageous to do so now and pay taxes at the present rates
rather than next year when the liability might be higher.
There is also the point that it may be to the advantage, of the
investor to sell securities currently and take profits. Such securities
can be repurchased immediately
and a higher tax cost established
against which future gains or losses can be made. While it is true
that taxes are, by using this practice, increased currently, a longer
term point of view can be taken under which overall taxes might
During November and

that

those

beyond

insistent.

budget which evolved
meeting was significant

mentary
from that

currents evident in different issues.

commitments

tainties

important influences

are

to expand mili¬

recently established, then infla¬
tionary stresses will become still

This Week—Insurance Stocks
considerations

Tax

it necessary

find

tary

Bank and Insurance Stocks
By

civilian production; should

jrom page 17

Thursday, December 21, 1950

...

The

ex¬

during the

past year makes it possible to meet

the'requirements immediately in

tion

Securities

office

shire

Boston,

Street,

ment

111

the

under

Ernest

investment

banking

tains

offices

other

Corpora¬

the opening of

announces

manage¬

Slifer.

firm

Devon¬

New

The

main¬
York

City and Chicago.
Mr.

Slifer

previously had been

associated with the Boston offices
of

Hemphill,

Parsons

and

Graham,

one

its

Graham, Parsons &

predecessors,
Co.

Noyes,

Co.

graduate

Yale

University and Yale. Law School.

Volume 172

Number 4970

The Commercial and Financial Chronicle

(2451)

dangerous world, there is

Canada and the War Crisis

land where life

securely
rate

President, Dominion Bank, Canada

order

make that date
a

less

portant
mark

What

our

conduct,

own

be.

-Outstanding

needs,

among domes¬
tic
events
in

Let

Canada,
the

would

was

bold

for

Robert

were

these

for

its

cover

With

true

own

reference

these

next year

fifteenth

the

one-

income;

still greater burden which

dians
that

may

when

justifiably

freed,
increased

of declining, it
value, relative to the currencies
of
other
countries, and is now
moving
within
quite
narrow
limits.
in

Business has been active. Prices
of

the

have

principal

been

kets—in
Thus

rising

many

the

dollar

wide for years,

materials

raw

world

cases,

fast.

shortage, world¬
has been eased in

cost of

addition, the vast program of
rearmament,
which
Communist
aggression has forced on the still
free countries, menaces all of us
with

inflation

further
five

during the
perhaps to

years,

greater degree than that which

occurred

War II.

during and after World
It is

should

vitajqthat all of
andnijcitizens

government

us,

alike,

fnobilize against this.

Our

government

too

that,

prevent

scale

the money needed for rearmament.

wisely declared against
this policy. I hope, therefore, we
need no longer make a fetish of
keeping down artificially the rate
of

bond

interest

ultimately,
inflation by

our

might be

government

cannot

means

order

inflation
which

require

self-discipline
the needs of

troops in

must

be ready soon

be, certain

to give up, if need
luxuries or comforts.

produce

enough rockets and
carriers and planes, we
must put up for awhile with less
than we would like of the good
things used in peace.

We shall make

country safe;
minimum of
shortages, if each of us during this
period of crisis, whatever the task
in front of him, works harder and
our

efficiently than before.

Canadians, fortunately,

not

lack confidence in themselves. But
vast half

all

are

continent,

few

too

the

for

What

Quite apart from de¬
requirements, there is ur¬

fense

present

create

and

energy

almost continuous in¬

in the number of Canadian

crease

dollars

—
currency and bank de¬
posits taken together—per head of
the Canadian people. I cannot but
feel that this was partly due to
the practice of creating new credit
from time
to time, in order to

sustain
ment

the

bonds

market

for

govern¬

whenever the

public

fifths

need,

use

now

something

two
per¬

have

of, Late

been

years?
1948,
one
hundred
and
twenty-five thousand immigrants
,

entered

Canada from abroad;
1949, the corresponding num¬
ber was ninety-five thousand;
During 12 months, up to July,
1950, the number was seventy-five
In

thousand.
Our

these

annual

years

hundred

one

tween
of

the
is

our

less

thus

thousand

stream
a

during
than

average

was

—

and

diminish¬

sharp contrast be¬

Canadian-

immigration,

Australia's

during the same years.
In 1948, Australia received
fewer
than
slightly
forty-nine

she

received

hundred

one

and

forty-nine thousand.

are ours,

in the great¬

possible * abundance.

In ' this

kinds.

the

this

scale

serving

two

shall be

ourselves

second

with

full

sharing

place—and I

seriousness
abundance

our

say

—

with

others,

formerly
less
fortunate
ourselves, we shall be prac¬
ticing the Golden Rule.

jobs for Canadians

when,

the

tomorrow's tasks;

There

than

key

McCracken, Professor of Business Conditions at the
University of Michigan, says high taxes alone cannot do job.

address

before

the

12th

to re¬
ceive immigrants, and success in
attracting them, will in the long
run

eagerness

greatly benefit

our

sister Na¬

tion.
^

,Our own country's population

is nearly twice that of Australia.
own

own

therefore,

intake

our

newcomers

been raised in Canada against the
the

same

that
bold

should

course as

Australia.

These are,
first—the coming of large num¬
bers of immigrants into Canada

into

the

which

market

Michigan
Bank
Study
Conference, at Ann Arbor, Mich,
on Dec.
7, Paul McCracken, Pro¬

must be purchased by the Federal

fessor of BusiJ-

which

Reserve,

tions

University of
Michigan
strongly urged

"(2) We
ernment

the Treasury's

policy
to

rather than
cash

and

Paul

combination

the

military

McCracken

for

national

security

must

goods

must

"(3)
status

taken

curb

must

possible

desir¬

rehabilitate

must

the

saving. Perhaps as the
defense program begins to pinch
hard, we ought to inaugurate a
national
savings campaign. This

come

take

Unless appropriate

are

the

a higher rate of return
holding his securities.

for

first, it follows that the supply of
civilian

considering,

soon

than our capacity
Since the provision

produce.

overlook

ability of according to the 'non-

civilian

will

demands

worth

spender'

add up to more

as making sav¬
eligible for collateral

bonds

not

"is

asserted,
that

converting them into
his spending.

augment

are

Prof.
ke

ings

must

rac

While such devices

with

deal,"

well

greater advantage to the
individual who holds his bonds

"A basic fact

gov¬

worth

accord

ing.

purchasing

banks. In this way we can help to

curb

life

proceeds

thereby make

can

securities

civilian spend¬

the

new

holding for individuals

interest

rate

using

creates

inflation.

abandonment of

low

additional private loans,

make

power, which provides an addi¬
tional basis for spending, which
would complicate the problem of

the

and

Condi¬

ness

the

should be much broader than

meas¬

ducing

civilian

people

buy

in¬

savings

bonds. The important thing is that
ourselves
they not spend the money. Whether
and
the savings take the form of savr
businesses
are
trying to spend
ings bond purchases, .additions,to
more than the supply of goods and
services available. This adds up to savings deposits or depositsdnsav¬
ings.t and loan associations: is of
the old familiar problem of in¬
less
importance, but again one
flation.
way of according more status .to
"How
can
we
curb
civilian
the saver is to pay him a higher
spending? We have all heard a rate for not
exercising that privi¬
great deal about gritting our teeth lege which is
his—namely to spend
and taking on a heavy burden of
his dollars.

spending,

will find

situation

where

people

While

taxation.

tions about
taxes

which

have

will

reserva¬

of the particular

some

levy, in the

aggregate we seem to be willing
to take a very realistic view on

paying
"But

tends

go.

taxes

one

complete

thing,

the

sap

American

vitality

taxation

vitality
and

economy

of the
that

our

exercises

restraint largely

than income dollars. Funds
Bank

loans,

increased

have

ample,
billion

already

re¬

this

can

for
over

year.

ex¬

War

cashed.

bonds

can

posits

can

Bank

"The

down.

conflict

Treasury

not

between

the

and

serve

Re¬

Federal

conflict
who happen to dis¬

primarily

men

the

agree," Prof.; McCracken conclud¬
in

"It reflects
the

basic

confusidh

thinking of the American

people which makes it difficult for
consistent

but

economic

We want to

emerge.

borrow

not

pay

want

policy -to
low prices

our

spend

right to

any

way

curbed, which makes for higher
prices. Bankers particularly can
perform

real service by keeping

the public informed on what must
be

if the

straint

objectives of rea¬

price

done

sonable

stability

inflation

achieved."

de¬

drawn

•

ed.

not

are

For

answer.

•

are

and
to

re¬
be
*

•

All

been happening on
this year and

Dempsey-Tegeler & Go.

constitute the major reasons why,

To Admit Two Partners

of these have
a

Proportionately

securities

Annual

borrowed.

Australia's

Inftation Curb

Paul W.

spending can be financed by other

proposal

est

all

shall

strengthening

times

constructive purposes:
In the first place, we

lack suf¬

the close

It is estimated that by

Until

Resources

let

of this year she will have received,
within a 12-month, no less than

in all its forms, per head of popu¬
lation, as is possessed by our
neighbors in the United States.

match, on this basis
of comparison, their equipment of
energy, the Canadian dream of
raising our standards of living
and of comfort, to the level of
theirs, will not be realized.

But

ducing the supply of income dol¬
lars available for spending. But

that

can

certainly

international position
thousand immigrants. But in 1949,
largely depends. Moreover, taxes

from abroad still is quite small.
Two principal objections have

is,

three

Urges Higher Interest Rates

experience

and

much mechanical power

com¬

Canadians and

problems

squeeze.

Canada Needs More People
Annual

prob¬
to receive into

well,

address

by Mr. Rae at Share¬
Meeting of The Domin¬
ion Bank, Toronto, Canada, Dec. 13, 1950.
♦An

new¬

all

sources

new

showed signs of a tendency to sell

holders'

two hundred thousand immigrants.
There is no doubt in my mind

for ordinary
from coal,

dissatisfied

numbers

receiving,

still

needs

Canada.

gent

(after allow¬
immigrants

from abroad per annum.

There

shall experience a

the

im¬

our

Canada and Australia Compared

Country Safe

like
and fifty thousand

hundred

present,
ing.

Work Hard: Make Our

such

secure

should

country

sons

defense,

skills

ures

rearmament and

some

ability need
this

Canada's

comers)

for

grim world. Even
vigorous
economy
there are
limits, at any given
moment, to the icapacity for .in¬
creasing production, >.-iT
j
So, for • the sake 'of- Canada's

our

everywhere

which

admitted in earlier years, and for
the subsequent departure from our

is asked of

order

per

war.

We live

two

persons

thousand

for the deaths of

ance

same

respect

and

others,

the

total

net

migrant population

other means,

use

the

net increase per annum

shores

must

But

effectively to prevent

purposes

has been

millions.

did during the decade

now

know

peace-time
petroleum,
dfed intend to borrow from the
rivers or any source whatever. public
on
a
substantial
scale.
We are in the process of doing
Ultra-cheap
money
never
did
that now in the Western oil fields,
anyone any good.
at Steep Rock Lake and in Labra¬
During the past five years there
dor. But we still possess only fourtempted to do if

fourteen

ending 1911, if we were increasing
our settled immigrant population

—

But it has

population

Thus, we would now be receiving
immigrants on about the same

these controls.

conceivably

might follow the line of least re¬
sistance
might borrow most of

present

estimated

postpone

we can

armour,

rise under such conditions.

prices

mar¬

very

quarters. Unfortunately, the
living in Canada tends also

many

means

inflation for awhile. But

was

instead

de¬

be pleased

dollar

our

terms, onetotal population

our

annum.

our

regard to the currency deci¬
sion, this was a good move. Cana¬

general

very

Canada's

making an alldefense effort,
of the direct control of

wages and

per annum;

years.

the

fense needs may compel us to bear
in later years.

ninety thousand

(immigrant and native-born com¬
bined) during each of those 10

while

effort,

twice

indicated by recent experience, we

for

buildings.

ficient

right

done,
of all

frank with ourselves:

once

of increase in the number of

hundred

that

needed

the

If, during this crisis in the life
mankind, we can manage to
bring over new
Canadians
on

safeguarding.

course, that there are not enough
hands here to lay bricks of
badly

growth be¬

know

war

their

One

counts

census

tion, call for government controls.
World
War
II
taught
us
quite a lot about controls. We
out

for

coming

to do the work that

benefit

mon

plentiful. In other

the

country.

the

industry, the key skills

immigrants will multiply, not nar¬
row, the range of jobs
in this

for

—

needs

of Canada's

about

But

limit

may

than

National

set

can

Canada's

for defense

absorb

first

the

developments,

minimum outlay

and

briefly what
years

Rae

value.

recall

born abroad, but success¬
fully settled in this Dominion, was

as¬

and

Jobs

words,

standpoint
of
the
Canadian people—all the fourteen
millions of us
there are not

will

persons

things

cause

made

are

Canadians

(in
the
decade from 1901 to 1911) the net

bring on ourselves, this impend¬
taken on Oct.
ing second round of inflation. Act¬
2, when it was announced that our ing thus, we would simply be
dollar
would
no
longer
be "letting our own team down." My
"pegged" on the foreign exchange belief is that we will act other¬
market, but instead would be per¬ wise.
Some Canadians fearing infla¬
mitted, in free dealings, to dis¬
step

merit—be¬

most rapid population

press

peace

seventieth of

But

Make

From

potential immigrants.

are

tween

sured.

though

mere

proof

happened here.
During the 10

rate

might

again elsewhere,

the

Will

spots

our

due to

are

of manpower.

We need the best of them—and in

for in¬
creased salaries and wages; might
insist
on
spending
for
luxury

proved
themselves to

the shortage

enough of

millions

today, when

substantial numbers.

long run
inflationary. We

citizens?
of

upon

These

Must Not "Let Our Team Down"

Each

people.

are

citizens of Canada.

come

his¬

have

good

—and

continuance.

tory than Aug.
4,
1914, and
Sept. 3, 1939,

it,
standards—

means

living
and

this

thought
that they might be permitted en¬
try to this Dominion; the thought
that they might in course of time

should, therefore, welcome its dis¬

land¬

eager to start life

doubt that its

consequences are

im¬

and

enthusiastic

can

Not

for

create

and energetic folk, dis¬
illusioned by the recent course of
events
in
their
own
countries,

recall,

possibly

dreams

In other lands there

as
the them, in any but relatively small
1950, the amounts.
Whatever
jointly-prompted Russian and
might
be
said
on
Chinese aggression against Korea other grounds for the practice of
on
June
25
sustaining the market for govern¬
ment bonds in this manner, there
last,
which

may

spite

But

our

—

these

need

absorb one-fifteenth of national income.

event

realize

achieve

taining market for government bonds by expanding credit.
Says Canada's minimum outlay for defense next year will

will

Dominion

equipment,

tionary impact of Communist aggression. Urges pay-as-you-go
policy of financing rearmament and decries policy of sus¬

striking

here.

caution.

most urgent problems

speed-up in our own
population
growth,
in

this

Pointing out though Canada is prosperous and exchange rate
of Canadian dollar is relatively stable, President
Rae, of Do¬
minion Bank, warns Canada must face fight
against infla¬

Canadians

of the recent

By ROBERT RAE*

most

than

now

be lived

can

substantial

scale

though the budget has been
practically balanced, we have still
even

had

substantial

inflation."

In order to deal with this ques¬

tion Prof. McCracken laid down

program consisting of three points:
"(1) We must make borrowing
costlier
means

and

that

difficult.

ST.

LOUIS,

This

Street, members of the New York
and

Midwest

progres¬

Stock

Exchanges,

will admit Albert E. Gummersbach
and Lewis J.

potential borrowers nership

in what should become

Mo.— Dempsey-

Tegeler & Co., 407 North Eighth

with

the

Whitney, Jr. to part¬

Jan. 1. Both have been
firm

for

many/«years,

might deprive Canadians of jobs; sively tighter credit market offer Mr. Gummersbach in St. Louis,
second—it would intensify the higher
interest rates, yields on
and
Mr.
Whitney
in the Los
present shortage of housing.
government securities must be in¬
Angeles office, 210 West Seventh
Perhaps < five years ago these creased. This will help to dissuade
might have been good grounds for

banks from dumping government

Street. ~

The Commercial and Financial Chronicle

(2452)

Britain's Raw Materials Shortage

E. F. Swenson, Pres.
Our

of N. Y. Inv. Ass'n
F.

Edward

Jr.

Swenson,

Clark, Dodge & Co. was elected
President of The Investment Asso¬

the annual

ciation of New York at

meeting of the
association.
Swenson,

Mr.

who has been

member

Executive

the

Board

organization
of

head

and
its

speakers

during
past year,

group
the

succeeds
1

E. F. Swenson,

Jr.

Co.

y e s

cent

war.

Witter
Co., Treasurer for the past year,

Dean Witter, Jr. of Dean
&

elected Vice-President,

was

while

Richard G. Murphy of B. J. Van

Ingen & Co. was elected Treasurer.
Harry A. Jacobs, Jr. of Bache &
Co. was named Secretary of the
association.
Elected to the Executive Board
to head various association activi¬

ties

the

for

Ralph

ensuing

year

were

Hornblower, Jr. of Horn& Weeks, program; Ed¬
D. Toland, Jr. of Shields &

blower
ward

Co., education; T. Alexander Benn
Lynch, Pierce, Fenner

of Merrill
&

Beane, publications and pub¬
licity; John C. Hagen of White,
Weld & Co., entertainment; and

Investment

Association

New York was formed in

?:nd

Brokers

: -any

1947

Association,

the

omprised

war.

200

some

now

the

in upwards of 80
banking and broker¬
age houses in Wall Street.
younger

men

E. H.

Newbery Co.

Newbery has formed E.

H. Newbery & Co., Inc. with of¬
fices at 40 Exchange Place, New
York

City, to conduct

ment business.

invest¬

Mr. Newbery

sold

being

the

that
-

willing

Voluntary Loan Restraints

Federal

Bank

Reserve

York

New

between

representatives of

Dr. Paul

whether it be for civilian

While it is true all loans

defense

purposes.

•

has

its way.

ing

evident

that

out-of-town

interested in this issue, and with
of these institutions will not be
than

banks

bit

current

there

still

room

great in 1951, there has been

further

government market is beginning to see quite a few
adjustments being made, although it is not expected too
will

these

take

place, despite lower

prices for

whole compared with the earlier part of the year.
that some tax selling is being done, mainly in the

This

is because

bottom is

Those who are inclined to criticise that policy
is another side-of the

mind, however, that there
*

was

TREASURY

countries.

most

partially-exempt,

MUNICIPAL
SECURITIES

far

matter how much they gave away abroad,

countries have

The

rose

25%.

will
as

doubt be

though there is

securities

nibbling
also

are

Much of the additional British exports

Britain and the

& Co.

maturities not

Street

metals and other raw materials
unemployment, on balance
consequences of American stock¬

economic

the

production and cause

disadvantageous

piling

Fire and casualty companies have been

•

shortage of dollars is easier to overcome

tial

It is reported that

considerable

now as

they

were

not

long

ago.

would

•

its economic advanges.
For a
than a shortage of essen¬

supplemented by a stroke
aid or military dollar
supplement the missing materials.

through agreements on Marshall

It is much more

aid.
.

greatly outweigh

The missing dollars can be

goods.

of the pen,

between the various issues with the shortest

popular

Tellier & Co. Admits
Walter

Broad

that has accompanied it.

difficult to

stage has been reached,

therefore, when American stock¬

piling, if it were to continue on an
...

Martin

45 Milk Street

and
NEW YORK 5

BOSTON 9

WHitehall 3-1200

HAncock 6-6463

Tellier

McKelvy to Admit

has

admitted

Brosnan, Max Sandler
Joseph Redinger to partner¬

ship in Tellier & Co., 42 Broad¬
way, New York City.
All have
been associated with the firm for
some

time.

position pro¬

compensation for the increase in the

INCORPORATED

The improvement of the dollar

stockpiling,
with their

If, however, shortages of base

should handicap

into the market, and there
while yet. Nonetheless- it seems,

the longest maturities, while pension funds have

It is,

come

fairly sizable buyers.

swopping is going

Aubrey G. Lanston

of it for

Had it not been for American

undoubtedly ample

cost of living

in price.

that the gold reserve showed such a

sterling area would still be struggling

dollar difficulties.

vides

sterling area exports of raw mate¬

not only in volume but also

thanks to this dual increase,

satisfactory recovery.

While the

the loss caused by this discrepancy.

better feeling in the making as far as these

concerned.

away at

been

have increased

rials

of trade.

only, the average price of

price of exports rose by 7%

served to make up for

Continue

Had it not been for this factor,
far,

drive would not in itself have gone very

imports

larger deposit institutions are concerned. The 2%s
be still having a day of- it, although there is no chasing

tap bonds

largely
months

succeeded

average

spotlight away from the last three issues of 2%s.

and depleted the gold
how much the United

owing to the adverse change in the terms
•

of the

matter

Britain in particular has benefited by

the British export

the

appear to

dollars

exports, was the main factor.

area

specifically, the longer maturities,
continue to be in demand and have been making a better showing
recently than corresponding maturities of the taxables. The belief
that taxes will be higher in the future, has brought some of the
smaller commercial banks into the partially-exempts. To be sure, '
there is no lagging in demand for the tax-sheltered Treasuries-

STATE and

' %

States developed an adverse trade balance and
outflow of gold.
Dollars are now no longer so scarce,

was an

many

reserves.

Partial Exempts Strong
The

of
No

chronic shortage

Fortunately for Britain,
,

•

the perennial favorable trade balance of the
the outstanding economic problem of the world.

replenishing their gold
the change. The
British gold reserve has shown a spectacular increase during 1950.
This was admittedly partly the result of the devaluation of the
pound, and of the anticipation of its revaluation.
But American
stockpiling, through its effect on the volume and value of sterling
and

growing that a
it has not already been made, to make
cases.

The United

there

of the feeling that appears to be

liquidation undesirable in most

certain amount of criticism of the American

gold spent

ago.

are

close by, if

payment of the current American export surpluses. Thanks
to stockpiling, this state of affairs came to an end a few

year-

intermediatebeing replaced by the new 13/4S. Although the longest bank bond is down sharply from the high of
the year, there is evidently no great desire to let this issue out.
maturities, which

returned to the United States again and again.
Or, to be correct, it never left the American shores, for the
amounts lent or given to foreign nations had to be used for the

many

the list as a
It is reported

caused;

the

purchases by Federal '

The

'.V-,;

States lent abroad,

if weakness should develop.

end

has been

can

production.

bear "in

reserves

for

trend

is considered to be by far the most important factor.

United States

hand

stockpiling demand has been primarily responsible for the sharp
rise in raw material prices, and has absorbed stocks needed for

looked upon as a stabilizer as far as market action is concerned.
It is believed the holdings of the Central Banks will tend to keep '
these notes from getting out of line on the up side while on the other

such

that

the ground that it has largely con¬
in the cost of living and on
ground that it has depleted the world's stocks of materials
available for current requirements.
Beyond doubt, American

the l%s and some

time

the

little investment buying in the

Switching has also been playing

For many years

recently offered 1955's.
growing role in the digestion of
of the larger deposit banks have been using this

effect

tributed towards causing an increase

the opinion that loans of certain
as

bad

some

policy of stockpiling, both

the high

becoming

effort

unemployment through lack
Such a possibility is likely to

press.

There has been

picture.

are

materials

extra

Now that this omission is made good
efforts are made to ascertain whose fault
hardly be blamed, for its present extent
to make any fundamental difference. On the other

the

purposes

The l%s appear to be moving into stronger hands every day
is

raw
an

belatedly,

is toe moderate

are

despite the fact that the floating supply is still

that

few weeks ago there was hardly any refer¬

Rearmament

must

supply

means

hand, stockpiling is rightly regarded as the main cause.
In par¬
ticular, American buying of strategic raw materials for stockpil¬

New l%s in Demand

side.

Yet until

somewhat
it is.

for

evident

been

ence

not

veloped overnight. To those whose job it is
closely the developments in the commodity market it

those loans that ultimately increase the

term

u. s.

Einzig

the American Bankers Association,

Life Insurance Association and
the monetary authorities *
indicates the determination of all groups to cut down inflationary '
lendings whenever and wherever possible. However, will this
bring about any important restraint in the loan trend? The initia¬
tive for making loans does not rest with the lending agencies, since >
they are only the channels or the instruments through which the :
borrowings are expressed. As long as prices are increasing and
costs are mounting, more money will be needed to carry on busi- ;
ness.
This in many instances results in a far greater demand >
for loanable funds, which is necessary to keep production going

would

the workers, since
they would be reluctant to exert themselves
only to find that they have worked them¬
selves out of employment.
The raw material shortages have not de¬
produce

the Investment Bankers Association and

develop, in

materials.

not

are

possibility

hours

longer

the

by
This

might result

voluntary method of restraining loans a full try before resorting
to the clumsy and not desirable way of attempting to retard them,
namely, an increase in reserve requirements. Accordingly, the
banks were again urged by Chairman McCabe of the Federal Re¬
serve
System to develop ways and means to discourage further
inflationary credit extensions. The recently held meeting of the

will

problem, because the output would

limited

than

goods, owing'to lack of raw

work

the

available.

to give the *

shortages

1951

Even if the industrial workers were

materials.

was

formerly
President
of
Chilson,
Newbery & Co., Inc. of Kingston,
U. Y., maintaining his headquar¬
ters in New York City.

during

solve

Board is going

And there is

various essential

ahead for these securities in the not too distant future.

It is evident the Federal Reserve

high prices for essential goods,

great deal worse if those goods

available.

liquidation, the opinion seems to be more general that better days
are

While until

material shortage. After all, bad as it is

raw

to have to pay

institutional

method to build up holdings in the new note. The fact that Fed¬
eral acquired $2,700,000,000 or slightly more of the l%s is being

ivestment

Earl H.

it is

still

are

vestors, mainly life insurance companies, and the Central Banks
continue to do selective buying of these obligations.
Despite the

with

business

securities

recent

bonds

the economic topics of the day.

terest, today it'is almost forgotten in face of the problems raised by

inflation.

of its members veterans who

entered

■after

restricted

price of her

the rise in the cost of living was the center of in¬

few days ago

prices from time to time.
The

average

LONDON, Eng.—The raw material problem continues to gain
in prominence among
a

premium issues. There has likewise been a better demand for the '
longer partials, despite some rather unimportant quoting down
of

only 7% while
rose 25%.

imports
.

security appears to be becoming more popular with the out-of- *
town commercial banks, especially those with savings deposits.
The 1956 maturities have been giving ground to the new issue, '
with considerable swopping going on at the expense of the higher '

Bankers

Investment

British export prices rose

•

for

ship.

Junior

near future, because it is believed
there will be a tendency
prices to remain rather stable despite some year-end adjust¬
ments. The bank bonds have been paced by the new 13/4S and this

impeding rearmament but is causing unemployment in Britain.
Points out situation has nullified Sterling devaluation, since

Renwick E. Case of Discount Cor¬

the

EINZIG

Ascribing Britain's serious raw materials shortage to U. S.
stockpiling, Dr. Einzig contends this shortage is not only

inflationary in the initial stages, productive or distributive >
capacity are anti-inflationary in the long run. It may be that loans
for non-productive purposes will be sharply decreased or entirely "
eliminated by the various private lending institutions, as a result
of the meeting just held between them and the powers that be.
This would be an important contribution in the fight against

poration of New York, member¬
The

By PAUL

The government market is still in the backing and filling '
phase following the refunding, without decisive price movements
in either direction. Also not too much is expected to happen in

graduate of Yale

University and served as a captain
in the U. S. Army during the re¬

Governments

By JOHN T. CHIPPENDALE, JK.

Parsons

ham,
&

of
Hemphill,
N o y e s, Gra¬
N

Reporter

Thursday, December 21, 1950

...

PITTSBURGH, Pa.—Gelston B.

Morris, Jr., will become
in

McKelvy

Building,
Yorjk

Co.,

members

and

changes,

partner

Union Trust
of

Pittsburgh

on Jan. 1.

the
Stock

New

Ex-*

defeat

its

object.

Britain and other countries it would
of

arms

the

It would threaten,
the dollar position,
drive of the countries concerned whould suffer
raw materials.
This is now being realized some¬

cancel its beneficial effect on

export

through lack of
what

reduce the combined volume

production of the democratic nations.

moreover,
for

excessive scale, would tend
rearmament effort of

By handicapping the

belatedly, but it is better late than never.

Volume 172

Number 4970

The Commercial and Financial Chronicle

New York

(2453)

Security Dealers Association

David Morris, David Morris A Co., President of the New York Security Dealers Association;

Abner Goldstone, New York; Commissioner Edward T. McCormick, Securities A Exchange Commission;

J. Allen Frear;

Philip L. Carret, Cammack & Co.; Francis Adams Truslow, President of the New York Curb Exchange

Stanley

Frank Dunne, Dunne A Co., Governor of the New York Security

Roggenburg, Roggenburg A Co.; Edward
E. Kuehner, Joyce, Kuehner A Co.

Hanns

Kole;

John
of

the

Senator
Dealers Association

Egan,

National

Edwin L. Beck, Commercial A Financial Chronicle; Col. Oliver J. Troster, Troster,
Edward Gray, New York Stock Exchange

First California Company, San Francisco, president
Security Traders Association; D. Frederick Barton,
Eastman, Dillon A Co.

Currie A Summers;

Irving Allen Greene, Greene and Company; Harry R. Amott, Amott, Baker A Co., Incorporated;
Philip C. Kullman, Jr., John J. O'Kane, Jr. & Co.; Ralph C. Baker, Amott, Baker A Co., Incorporated

"Duke"

Hunter, Hunter

George

Geyer,

Geyer

Aisoiiaiicn

Co.; Hal E.
New

inc.;

Securities

Wallace Fulton,
Deaers, Inc.

Murphy, Commercial A Financial Chronicle;

York

Lou Walker, National Quotation Bureau,
John J. CPKane, Jr., John J. O'Kane, Jr.

Co.,
of

Journal

National

Shelly Pierce,

Commerce

Inc.; John M. Mayer, Merrill Lynch, Pierce, Fenner A Berne;
& Co.; Harry D. Miller, Nugent & Igee, East Orange, N. J.

The Commercial and Financial Chronicle

(2454)

Silver Anniversary

Edgar

Baruc,

Goldman, Sachs

Co.;

Frank

Josephthal

Lloyd

Edward

North

Harry

Lubetkin, Seligman, Lubetkin & Co.;
Seligman, Lubetkin & Co.

Hall,
&

Sutro

Bros

Co.;

Mortimer

Gartman,

Searight,

Otto

Jensen,

Peter

Byrne,

Regional

Administrator, Securities
Commission, New York

Otis, Gearhart, Kinnard & Otis, Incorporated; Edward F. Henderson, Trust Company
Charles D. Runyan, Trust Company of North America; Karl G. Berg,
Gearhart, Kinnard & Otis, Incorporated

Orloff, Troster, Currie & Summers; Julius Golden, Greene and Company; Herman
Singer, Bean & Mackie, Inc.; Bernie Weissman, Siegel & Co.; Charles D. Ogden,
Ogden, Wechsler & Co.; Arnold J. Wechsler, Ogden, Wechsler & Co.

Frankel,

Andrew
Joe

Alberti,

James

Thursday, December 21, 1950

Dinner

Co.

America;

George

...

Eisele,

King, Lihraire, Stout & Co.; Paul R. Rowan,
Commission; Bill Kumm, Dunne & Co.

Exchange

Securities

Exchange

C. Stanley Duggan, Securities & Exchange Commission, New York;
Abraham M. Metz, guest

Riggio,
Walston,
Hoffman
&
Goodwin;
Dan
Daly,
Walston, Hoffman &
Goodwin
Walston, Hoffman & Goodwin; Tom Lally, A. M. Kidder & Co., Bridgeport, Conn.;
Elmer E.
Myers, Geo. B. Wallace & Co.

FitzGerald, W. L. Canady & Co., Inc.; Robert M. Beattie, Jr., W. L. Canady & Co., Inc.;
Herb Hipkins, Charles King & Co.; Jerry
Burchard, Charles King & Co.;
i
Ken
Howard, J. A. Hogle & Co.

Volume 172

Number 4970

...

The Commercial and Financial Chronicle

(2455)

Held December

Julian, Hardy & Co.; Earl H. Hooper, Gear hart, Kinnard &
Otis, Incorporated; John
Amott, Baker & Co., Incorporated; Harry MacCallum,
Jr., MacCallum & Co., Mt. Vernon,

Connell,
N. Y.

8th, 1950

Walter

Saunders,

Dominion

Soule, National
Greenberg,

Tom

Association

Securities

Unterberg

Edward

Dealers;

Dealers

Co.

Enright,

Association;

Securities
B.

George

Corp.;

Harold

Pizzini

Co.,

Smith,

Pershing

Co.;

Pizzini,

Inc.

'•

Executive Secretary of New York Security
Joseph Flanagan, John J. O'Kane, Jr. & Co.

Shea,

Glore, Forgan & Co.; Louis
Troster, Currie & Summers

Singer,

George

Shea,
H.

Wall
Knox

Street
Co.,

Journal; Jim Durnin, H.
Inc., Boston; D. Raymond

Frederick A. Terry,

Buffalo,

Knox

Kenney,

Co., Inc.; Frank Harrington,
Raymond Kenney & Co.

Terry & Company; Herbert C. Stearns, Jr., Schoellkopf, Hutton &
Pomeroy, Inc.,
N. Y.; Otis G. Dennison, Dennison, Field & Co., Inc., Rochester, N. Y.; Russell G.
Talbot,
Co., Buffalo, N. Y.; Joseph G. Connolly, Kaye, Scholer, Fierman & Hayes

Talbot

Percy
G.

S.
A.

Williams,
Saxton

Moran,

Commissioner

Kearns & Williams; Charles M
Kearns, Kearns & Williams; Leslie Barbier,
Co., Inc.; John J. Kelly, National Association of Securities Dealers, Inc.

Securities
Richard

&
B.

Exchange Commission; Charles H. Dowd, Hodson & Company, Inc.;
McEntire, Securities & Exchange Commission, Washington, D. C.;
Carl Stolle, G. A. Saxton & Co., Inc.

The Commercial and

Financial Chronicle

...

Thursday, December 21, 1950

(2456)

At The Waldorf-Astoria

John

of
New
York State;
Mortimer W. Landsberg,
Rutenberg, Asst. Attorney General
Board, New York Curb Exchange; George E. Rieber, Secretary, National Association
E.
W. Snyder and Co., Syracuse, N. Y.
Securities Dealers, Inc.; E. W. Snyder,

George

V. Hunt, Starkweather
Philadelphia;
Samuel E.

Soren D.

Nielsen, New York Hanseatic Corporation; Allen Broomhall,
Corporation; Anthony Mercovich, Laidlaw & Co.

New York Hanseatic

E. Paul Emert,

Roy

W. L. Canady & Co.,

Larson,

D. Knox
John

Clarence E. Unterberg, C. E. Unterberg &
guest; Warren S. Currier, Perrin, West
Boston, Mass.

Inc.; John H. Kugel, Kugel, Stone
Tellier

Co.

& Co., Inc.; Walter F. Tellier,

<£ Co., Inc.; Larry Lyons, Allen & Company;
Jr. & Co.; Arthur Vare, Hourwich & Co.

O'Kane,

Harry D. Casper,
.

& Co.;
Magid,

Hiscox,

Chairman of the
of

Hotel

Co.; Frank J, Prince,
& Winslow, Inc.,

Van

Harold H. Van Meter, Hiscox, Van Meter & Co.,
Hill, Thompson & Co., Inc.; Arthur G. Hiscox,
& Co., Inc., Philadelphia

Inc.,

Meter

Andy Riggio, Walston, Hoffman & Goodwin; John F. Reilly, J. F.
Reilly & Co., Incorporated; Sid Jacobs, Sidney Jacobs & Co.

Melville S. Wien, Jr., J. Arthur &Warner John P. Incorporated? Arthur A. Michels, Co., Incorporated;
M. S. Wien
Co.; & Co., Germain, J. Harry Warner & Allen & Company
John D. Ohlandt,

Fred D. Gearhart, Jr., Gearhart, Kinnard & Otis,
.

Incorporated, and musicians i
i'

Volume

172

Number 4970

The Commercial and Financial Chronicle

(2457)

Hayden, Stone & Go.

Public

Utility Securities

Admit New Partners

NSTA

Hayden, Stone & Co., 25 Broad
Street, New York City, invest¬

By OWEN ELY

Notes

ment bankers and members of the

Long Island Lighting Company

New

Long Island Lighting Company was incorporated in 1910 as a
merger of four companies serving part of Long Island, and from
time to time other utilities in the

until almost the entire island

area

acquired and merged

were

served.

was

However, several im¬

portant companies became subsidiaries and their preferred stocks
remained in the hands of the public. Since both parent and sub¬
sidiary companies were generally over-capitalized, particularly in

York

Stock Exchange and
principal stock and com¬
modity exchanges, have proposed
the admission as general partners
on
Jan. 1, 1951 of Sherman M.
Bijur, Albert Ehrenfreund, Julius

other

Ward.

The

admit

•

of trial. and effort
recapitalization plan has been evolved, and
many

years

broad

Oct. 24.

put into effect

was

The various preferred stock issues

well

(including

debentures

some

and

notes)

and

26%

the parent

common

equity (3,150,000 shares). It is expected that in 1951 the
issue

preferred and

some

common

ratio

estimated

consented

review

63%.

The

stock

company

stock, reducing the debt

Public. Service

bie), which the

Commission

has

company considers

excessive; should reduction be
allowed, this would improve the equity ratio.
The

is readjusting its rates so that earnings will
(or slightly more) on the rate base; electric rates
$500,000 per annum recently, and gas rates
may be reduced next year by some similar amount.
company

; approximate 6%
reduced

were

about

The company will benefit

considerably next year by the cur¬
rent substitution of natural
gas for manufactured gas. Gas earn¬
ings have been very inadequate in the past, and erratic due to
changes in fuel costs. Natural gas is now to be received from

Transcontinental Gas Pipe Line Corp. on a contract basis, which
should help to stabilize gas earnings. While weather conditions are

still an important factor, particularly with future increases in
house heating, earnings lost by the gas department in a mild win¬
ter will be partly offset

which will
■

use

The company

by fuel savings in the electric department,
any surplus of natural gas as fuel under its boilers.
hopes to save about $3.3 million before taxes next

through the

of natural gas, of.which about $1 to $1.5 million might be salvaged for stockholders after
allowing for rate cuts
and taxes, it is estimated.
year

use

Nearly one-third of the electric generating plant is modern,
having been built in the last three years, but the remaining plant

^ is,' on the average some 20 years old. However, the company is
interconnected with Consolidated. Edison and if
necessary
can
draw 75,000 kw. from that company. Long Island
Lighting expects
i/o- install 100,000 kw. generating capacity in the fall of 1952 and
'

| another 100,000 in 1953 (compared with present capacity of
*

are

350,000).

The company's water gas facilities
(daily capacity 48,000 mcf)
rather old, but the liquefied petroleum unit (8,000 mcf) and

the'catalytic plants (49,000 mcf)

are

modern.

When the full

con¬

tract supply of natural
*

gas is obtained, the water gas and liquefied
petroleum plants will not be needed except for standby and peak

demand purposes.

Long Island has enjoyed very rapid growth, Nassau County's
population having increased 64% in the past decade and Suffolk's
38% compared with only 9% for the New York Metropolitan area
and Westchester

Population density is still low compared
with Queens County, leaving room for further substantial growth.
While residential growth may be slowed during the defense period
by restrictions on housing, it should be resumed when these re¬

strictions

■-

are

County.

eased.

In addition to the advantages of rapid growth,
Long Island
Lighting is favored by the large proportion of residential business
—far higher than for any other company of comparable size in the

United States.

This should help to stabilize future earnings.

1923

months.

26%

the

new

31, 1950 the company earned $1.25
basis compared with $1.13 in the previous

Net income for the month of October showed

over

last year.

is difficult to

estimate

1951

gain

earnings

because of the many factors involved—the effects of recent storm
damage, the cut in electric rates and the probable 1951 cut in gas
rates, increased Federal income taxes, the anticipated financing,
-

and the savings from natural gas.
However, Wall Street analysts
anticipate earnings in the neighborhood of $1.40 or more in 1951,

before EPT—which

the basis of the

be small in relation to income taxes.
to 50%

what

serious.

nual rate of

ment).

some¬

However, it is anticipated in the Street that

able to initiate regular dividends at the

$1 (the recent 25-cent dividend

The new stock

was

partner since 1928.

Hayden,

Stone

except for two

since

Co.

of the New York Stock

has

charge

recent

Exchange.
been in

years

firm's

the

1923

member

years as a

department.

investment
.'

■

Julius A .Hallgarten, as former

recently quoted

was

an¬

"special" pay-

the Stock Exchange

fices

Hentz

manager

eign

Co., became

Hutton's

Department" in

For¬

and

1938

been

associated

with

the

Department. He is
dent

tomers'
York

the

Brokers

Society

Kenneth Ward has been

sociated
field

with

since

Delafield

1942

and

as¬

dependent
York

Wis.

—

been

member

Simmons,

admitted to partnership in Mabon

Welsh, Davis and, Company, Chi¬

Co.,

City,
Stock

115 Broadway, New York

members of the New York
Exchange,

Jan. 1.

cago,
the

Vice

President

will become associated with

Merchants

of Janesville

and

Savings Bank

Jan. 1.

•

will be

two of the National

are

appointed by the President

after the first of the year.

CLEVELAND SECURITY TRADERS ASSOCIATION
The

Board

Governors

The

Cleveland

Security Traders

Association have nominated the following slate for the year 1951:

in¬

the

President

New

Rensselaer

Institute

York

Chairman

since

1935.

the

Troy,
is

Ludlow

Co.

also

Valve

Troy

and

director of other corporations and

banks in the community. He is a
former
ment

Chairman

Finance

the

Govern¬

Committee

the
Everett

National Association of

Brock

Park

Europe. Earle H.
of

the

New

Rodney,
York

Stock

many years, was co-

founder of the firm of Fuller Rod¬

& Co. in 1931 which

ney

Howard

Eble

Harmon A. Rudin

Walter

Carey

Everett A. King, Fulton, Reid & Co.
Vice-President: Howard J. Eble, Wm. J. Mericka

associated

was

International Underwriters Group
in various posts in the Far East
member

King

President:

& Co., Inc.
Secretary: Harmon A. Rudin, Ledogar-Horner & Co.
Treasurer: Walter J. Carey, Gunn, Carey & Co.

for many years with the American

and

Manufac¬

turers.

was

The Nominating Committee, composed of A. W. DeGarmo,
Chairman; George F. Opdyke and J. N. Russell, have submitted the

following candidates to comprise The Board of Governors for the
of 1951 (four to be elected):

year

Roy E. Bock, Dodge Securities Corporation.

ab¬

Robert L. Erb, Green, Erb

& Co.

sorbed into Merrill Lynch, Pierce,
Fenner and Beane in 1941 where

Albert Fischer, Paine, Webber, Jackson & Curtis.

Myron Gelbach, T. H. Jones & Co.

became

special partner, re¬

Milton B. Lewis, Jaffe, Siegler & Co.
Martin J. Long, First Cleveland Corporation.

tiring in 1942.
Robert

his

Stone

interest

will

the

continue

firm

Jack
as

McGinty, McDonald & Company.
Burge & Kraus.

Fred Shorsher, Ball,

limited partner.

SECURITY TRADERS

Fahnestock & Go. to
Fahnestock & Co., 65 Broadway,
New

York

New

York

Jan.

City, members of the
Stock
Exchange, on

will

admit

and

the

Charles

Frank

Stock

Davis

and

Mr.

Davis,
Exchange,

Mcintosh

Davis

Association
of Dec. 15

OF NEW YORK

New

are as

Won Lost

(Capt), Kaiser, Growney, Gronick, Rappa
—
Leone (Capt.), Krasowich, Nieman, Pollack, Gavin
Krisam (Capt.), Bradley, Montanyne, W^eissman, CannonBurian (Capt.), Manson, King, Voccoli, G. Montanyne__
Hunter (Capt.), Lytic,' Reid, Kruge, Swenson__

21
20
19
19
18

11*
13
14
14
15

Serlen (Capt.), Gersten, Gold, Krumholz, Young
Mewing (Capt.), Klein, Flanagan, Manney, Ghegan
H. Meyer (Capt.), Smith, Farrell, A. Frankel, La Pato__

16
16

17
16*

Goodman

(Capt.),

Valentine,

Casper,

Meyer,

;

(Capt.),

Demaye,

O'Connor,

Whiting,

John

111.

—

Carl

Brown,

Tisch, Strauss, Jacobs
Greenberg (Capt.), Sullivan, Stein, Wechsler, Siegel
♦Julie

Bean

Bowling

Sam

and

session

Hoy
on

Meyer
Dec.

Bank

had high series for the

Building.

third

game.

20
24

will be played at

the

2#.

(Garfield & Co.), Milton Meyer (Shufro, Rose
James Gavin (Blair Rollins & Co.) each won a

bottle

Co.)

their

13
9

Gronick

Degitz, and Fred W.
Sueltman have joined the staff of
Slayton & Co., Illinois National

tied

Work-

meister

(Special to The Financial Chronicle)

Frankel

Donadio

Kumm (Capt.), Weseman,

Quincy,

(STANY)

TEAM

which is dissolving Dec. 31.

Join Slayton & Co.

York

follows:

Bean

are

Mcintosh

ASSOCIATION

The Security Traders
Bowling League standings

Admit Three Partners

Allen

railroad bond department, will be

George Writer and Norman Barwise
Committeemen and two

Polytechnic

partners

JANESVILLE,

Exchange for many
Dr. Livingston W. Houston

years.

Mr.

With Janesville Bank

Simons, Roberts

Stock

Doerrler

Partner in Mabon Go.

Christen-

Dela-

Leslie Harman has been

member

Louis J. Zwahl, Manager of the

Writer

Peters,

prior to that

ders & Ward.

New

Writer,

partner of Dieffendorf, San¬

was a

has

are: Norman
Barwise, Merrill Lynch, Pierce,
Beane; William Sweet, Peters, Writer & Christensen,
Inc.; Frank Tschudi, Bosworth, Sullivan & Co.; William May,
Stone, Moore & Co.

Fenner

resident

1951.

George

Directors

The

An¬

Thomas, the Albany,
partner of Kalb,
Voorhis & Co., will serve in a
similar capacity for an office of
Hayden, Stone & Co. proposed to
be opened in Albany on Jan. 1,

Co.

Wm. Minot
Y.

Clark

Secretary—Robert Kirchner, Boettcher & Company.

alysts.
N.

Treasurer—Phillip J. Clark, Amos C. Sudler & Co.

New

Security

—

Vice-President—Raymond Robinson, Sidlo,

Cus¬

the

and

Phillip

ensuing year, to take office

Inc.

and

firm

to general partnership, and Allan
J. Mcintosh to limited partnership.

President
sen,

former Presi¬

Association

R. L. Robinson

elected for the

were

Jan. 1.

since 1944, in recent years as head
of the
Research
and
Statistical

established.

Allen Simmons Now

ing officers

1945 became associated with Hay¬
den, Stone & Co. in the same
capacity. N. Leonard Jarvis has

around l2l/o, with a potential yield of 8% if the $1 dividend rate is

Louis Zwahl to Be

George S. Writer

manager of various European of¬

pending House bill should

A rise in the income tax rate

(from the proposed level of 45% for 1951) might be

the company may be

and

Exchange for

In the 12 months ended Oct.
per

Leslie

Albert Ehrenfreund has been with

Manufacturing

•.

proposes

partners

Sherman M. Bijur has been as¬

also

sociated with H. Hentz & Co. since

the

question of the size of the depreciation
(accrued under rules prescribed by former Chairman Malt-

reserve

firm

limited

Rodney.

company common were converted into new common stock of the
merged company. The new company has a clean balance sheet,
with a plant account
purged of questionable items, and with very
adequate reserves. .The new capital structure is about 74% debt

will

ton, A. Brock Park and Earle H.

and

merger

DENVER

Meeting of the Bond Club of Denver, was held
Park Hill Country Club, on
Thursday, Dec. 7. The follow-

Harman, Dr. Livingston W. Hous¬

aresult.

After

at the

Annual

Wm. Minot Thomas and Kenneth

lated

CLUB

The

Hallgarten, N. Leonard Jarvis,

relation to earnings allowed under the severe
regulatory standards
in New York State, large arrears of preferred dividends accumu¬

BOND

and

scores.
Willie Kumm (Dunne & Co.)
night with 546. Merry Christmas!

liquor for high

Financial Chronicle

The Commercial and

Thursday, December 21, 1950

...

(2458)

and James

Assistant

by the stockholders of the Provi¬
dence
National
Bank
and
the

opening of the new
branch office, Irving has issued a
brochure entitled
"Spotlight on

which tells in words
the past hundred-year

Fifty-Seventh Street

history of the

neighborhood's growth from a vir¬
mut-flat

tual

prominent

the

The Ir¬

thoroughfare it is today.

of Sterling Na¬
tional Bank & Trust Company of
JNew
York have elected
Frank
directors

The

of the

Kley as a Vice-President
hank.
Mr.

F.ley

was

appointed Vice-Presidents of
Chemical Bank & Trust Company
of New York according to an an¬
nouncement on Dec. 14 by N. Bax¬
ter Jackson, Chairman.
Mr. Bar¬

branch is in the new 25story office building just erected
on the site of the old Parke Bernet

Adjust¬
ment Board of
the War Ship¬
Price

ping Adminis¬
tration during

been

Central

Na¬

Corpo¬

tional

ration, underw r it e r s and

in
Kley

Frank

securities.

director of

tion and

Eastern Corpora¬

Works,

Royal Lace Paper
at

stockholders of
Chemical Bank & Trust Company
New York in notices this week

the

the foreign

David

department;

Doscher
the

securities

made

officials,
Executive

effective Dec. 31 of three

viz.: Lester Van Brunt,

department; Frank E.
Assistant Manager of

customers'

28 to

been

has

Announcement

Patterson as Assistant Manager

Dec.

by the East River Savings Bank,
New York City, of the retirement

Manager of the municipal

It, which provided for the change
la the date of the annual meeting

bond

payable

cents,
at

Boyles and William B. Stalker as
Secretaries; Leonard S.

regarding the annual meeting to
he held Jan. 16 is called to an
amendment to the by-laws on Oct.

announced

stockholders of record Dec. 15.

Assistant
as

Secretary, and a
Trustees

Vice-President,

member of the Board of

depart¬

building

the

second

the

Tuesday to

in January in each

third Tuesday

of the Ger-

now near"He

1912 to 1948.

Manager of the Saving

was

of Germantown and

Fund Society
a

member of the Advisory Com¬

the Reconstruction

mittee

Fi¬

Corp."

nance

$25

institution's

the

Treasurer from

The voluntary

liquidation of the

Deposit National Bank of

Farmers

Pittsburgh, Pa., became effective
at the close of business on Dec. 1,
capital stock of the Provi¬
following the bank's absorption by
dence National Bank consists of
the
Mellon
National Bank and
80,000 shares of $25 par value on
Trust
Company
of
Pittsburgh,
which dividends at the rate of $3
noted in these columns Dec.
7,
annually have been paid in recent
page 2195.
years. For each of these shares it
*
at
*
is proposed to issue in exchange
Walter G. Bellairs has been ap¬
one share of the consolidated bank.
Secretary and
The Union Trust Co/capital stock pointed Assistant
Charles J. Weber appointed As¬
consists of 10,000 shares of $100
sistant Treasurer of the Land Title
par value on which dividends at
Bank and Trust Company, Phila¬
the annual rate of $7 a share are

$10,000,000.
"The

now being paid.
For each of these
1921; William G. Terlinde,
shares five shares of the consoli¬
ment; William G. Racz and Donald
Vice-President, having served the
Ross as Assistant Managers of the*
dated bank will be issued.
year. Commenting on the change,
bank 45 years; Gaetano ZampaN. Baxter Jackson, Chairman of bond department; Leslie J. Chris"Allocation of stock has been
riello,
Assistant Vice-President,
tensen and Herbert H. Turnier as
the board of the bank, said: "The
who was first associated in 1906 arrived at by an equitable valua¬
Assistant Managers of the 29th
extra week will give our staff
with
the
Italian
Savings Bank tion of the net assets to be con¬
Street office; and Walter C. Sundmore time in which to compile the
which merged with the East River tributed by the two banks. At the
data
necessary
for the
annual berg as Assistant Manager of the
end of 1949 total assets were re¬
Savings Bank in 1932.
meeting and for the preparation Rockefeller Center office.
The following appointments ef¬ ported to be $87,960,000 for Union
*
*
«
m '
.
of our annual report."
Trust Co. and $60,978,000 for Prov¬
fective Jan. 1, 1951, were made by
at
at
at
Central Hanover Bank & Trust
idence National.
the Trustees:
George O. Nodyne,
The Board of Directors of Em¬ Company of New York announces
"It will be the first consolidation
Vice-President in charge of
pire Trust Company of New York the election of the following Vicebranches and staff relations, was move for Union Trust Co. Provi¬
voted on Dec. 12 to recommend Presidents at a regular meeting of
designated
as
Executive Vice- dence National, on the other hand,
that the stockholders at their an¬ the Board of Trustees: Hoyt AmPresident. Mr. Nodyne, President has figured in a move of this kind
nual meeting, Jan. 15, authorize midon, F. Morgan Palmer, A. T.
of the New York Chapter of the before. In 1945 it combined with
an increase of 10,000 shares from
Galloway,
Charles
S.
Bishop,
Blackstone
Canal ' National
American
Institute of Banking, the
the present total of 70,000 shares Louis E. Imhof, William H. Mil¬
1948-49, has been associated with Bank."
of
a.
at
*
* •
'
capital stock of a par
of ler, Grinnell Morris, and W. T. the bank since 1922; Charles C.
$50 each,, and .a transfer of $500,- Richmond. The following Assist¬
The proposed
merger of The
Joyce, Vice-President and Treas¬
000
from
undivided profits
to ant
Vice-Presidents
were
ap¬
Shelton
Trust
Co.
of
Shelton,
capital stock in conformity there¬ pointed: Gordon A. Watson, Ran¬ urer, was designated Administra¬
tive
Vice-President and elected Conn, (capital $200,000) with the
dall Rubenstein, Henry F. Skelwith, and to approve the action
First National Bank & Trust Co.
intended to be taken by the direc¬ ton, Henry R. Juliand, Edward C. Secretary; Joseph A. Duddy, for¬
of Bridgeport, Conn, (capital $2,tors
after the authorization
by Reuter, Joseph C. Walz, and Ray merly Comptroller, who came to
became effective as of
the
bank in 1926, will succeed 000,000)
stockholders of such increase, in F. Faughnan.
Mr. Joyce as Treasurer. Henry J. Dec. 2; it was effected under the
*
a-at
declaring a stock dividend of one
Monsees, Assistant Vice-President charter and title of the Bridge¬
share for each seven shares of
Harry J. Pugh has been elected in
general administration; Theo¬ port institution. The initial capi¬
stock outstanding. The directors a Vice-President of the Corn Ex¬
dore J. Kegelman, Manager of the tal of the consolidated bank will
also declared a regular quarterly
change Bank Trust Company of
Rockefeller Center office; George be $2,000,000, divided into 40,000
dividend of 1%%, or 75 cents a
New York, it is announced.
Mr. A.
Smyth, Manager of the 96th shares of common stock, of the
share, on the ■ capital stock pay¬ Pugh was formerly an Assistant
An item
Street office, and Arthur E. Kro¬ par value of $5 each.
able Jan. 8, to stockholders of
Vice-President.
"
ner,
Manager of the Oortlandt bearing on the merger was given
record Dec. 22.
The bank on Dec. 18 opened its Street
office, were advanced from in our issue of Oct. 19, page 1496.
at
at
a>

from

served

and

Provi¬

consisting of 130,000
par
value stock.
This, together with surplus and
undivided profits, will provide to¬
tal capital funds of more than
of

both

and in the busi¬
He was a member of

Dispensary and Hospital

mantown

provides that the capital of
consolidated
bank
will be

active

was

the Board of Managers

$3,250,000,

quarterly dividend of 25 cents a
share, plus an extra dividend of
25 cents a share, making a total

Other appointments
Christopher J. G. Dodge as
Assistant Treasurer; Aubrey

Allen

President
Trust

J. Shanahan,

meeting held on Dec. 12
directors declared a regular

that at

were

The attention of

the

Company of New York,

Appointed as
Assistant Vice-President was Wil¬
liam A. Menzel at the 74th Street
office of which he was formerly
Manager.

Inc.

ment

17, 1938.

Newhall

world.

ness

ing completion. The merger agree¬

of the Federation Bank and

and the Near East.

distributors of

Thomas

dence National

30,

that

in the community

Jr., President of Providence
since 1943, will be Ex¬
ecutive Vice-President with
of¬

Union

National

The

April

"Mr.

Building. Rupert C. Thomp¬

fices in the addition to the

bank

board on Jan.

son,

coming annual meeting of stock¬
holders will be held on Jan. 17.

North Africa

parts of Europe,

permit the
stockhold¬

the third Wednes¬

President of
1927, will
of the consolidated

with offices in the

bank,
Trust

1934. He
position, as the
bank's 15th President, until his
elevation
to
Chairman
of the

since

Co.

Trust

President

the

amend

Tuesday in January.

second

department. Mr. Tree
joined the bank in 1945, became
Assistant Manager of the foreign
department in 1-946 and Assistant
Vice-President in 1948. He travels

president of

Union

day in January of each year, in¬
stead of the Wednesday after the

the foreign

Vice-

voted

have

ers' meeting on

in 1946 and Assistant VicePresident in 1948.
He travels in
the United States and Canada for

has

1950

managers.

served

President

elected

was

the

of New

holding of the annual

ager

and from 1945

Marine

company's by-laws to

joined the bank in 1922, was ap¬
pointed Assistant Manager of the
foreign department in 1939, Man¬

World War II,

York

"He

boards of
In part the "Journal"

"Walter F. Farrell,

The

Company

Trust

Midland

present per¬

sonnel, including branch
also said:

directors

The

the

continued with their

a-.

joined the bank in 1908, served
as Credit Manager in 1919, Assist¬
ant Cashier in 1921 and Assistant
Vice-President in 1928. Mr. Foulk

member of the

dation

galleries.

ton

provide for a consoli¬ 19, he was employed by the Penn¬
institutions under sylvania company as an Assistant
He was appointed
the charter of the Providence Na¬ Bookkeeper.
Treasurer
on
May 8,
tional Bank and under the title Assistant
1905.
Subsequently he became
of the Providence Union National
Treasurer, Secretary, Vice-Presi¬
Bank & Trust Co. The Providence
"Journal" of Dec. 5 stated that all dent and Executive Vice-President
offices of both institutions will be of the institution.

ving

been

delphian, and in part also said:
"On Nov. 12, 1896, when he was

of Provi¬

both

Co.,

noted that he was a native

dence, R. I.,

57th Street,"
and pictures

Trust

Union

memorate the

Philadelphia "Inquirer," which
Phila-

the

Plains to be acted upon on Jan. 3

William E. Scott,
Secretaries.
To com¬

Seibert, Vice-President,
M. Maltbie and

delphia.

since

a-.

value

Stockholders

The

Bank

will receive
cash dividends of $1.10 per share
at the end of the year, by action
of the directors at a meeting on
Dec. 8.
The board declared the
regular quarterly dividend of 30
cents per share and an extra cash
dividend of 80 cents per share.
Both will be payable on Jan. 2 to
stockholders of record Dec. 18. In
addition, a dividend in stock will
be issued on Dec. 29 to stockhold¬
ers of
record of Dec. 18 on the
basis of one new share for nine
now held.
This action by the. di¬
rectors
followed
approval
by
stockholders .on Nov. 27 of a char¬
ter"' amendment to permit ail* in¬
crease in the bank's capital stock

Virginia at Richmond

$1,800,000 to $2,000,000, pre¬
which appeared
in our issue of Dec. 7, page 2195.
Total cash dividends declared
for 1950 will amount to $2 per

from

vious reference to

additional shares
Dec. 29 will
bring the total shares to 100,000
of par value $20 per share.
share. The 10,000

of stock to be issued

The board of directors

chandise National Bank of

of Mer¬
Chicago

•

The Board of Directors of The
National City Bank

voted

Dec.

of New York

19 to increase the

surplus of the bank to $136,000,000
transfer of $10,000,000 from
unallocated reserves. This action
increases the combined capital and
by

surplus from $250,000,000 to $260,-

000,000.
at

DeCoursey

The Bank for Savings in the

elected a trustee
at the December

bold Mqrris was

the febank

Road,

branch

Gunhill
Sullivan

meeting of the board. Mr.

Morris

be
Road

1308

Gunhill

known as the East
branch. Frank D.

will

Manager

and

Charles J. Laub will be Assistant

Manager of the new branch.
at

Presidents.

York

opened

Dec. 18 its newest

office

of New

the

corner

Fifty-seventh Street and Madison
Avenue.
This office is Irving's
fifth in mid-town Manhattan. In

decoration the new

its design and
branch

office

traditional

and

the
functional—

blend

the

Y.,

If continued, this

represent

dividend

was

the

quarters occupy two floors which
are connected by private interior
elevator service. There is a main

night

Commission.

1949

was

Eepublican-Liberal-Fusion candi¬
date for Mayor. He is a member
of the law firm of Love joy, Mor¬

ris,

Wasson

member

&
the

Huppuch
Executive

and

a
Com¬

banking
a

lower

at street level and
banking floor containing
room

safe deposit

mittee of the Citizens Union. He

completely

is also actively associated with a

both

number

of educational

anthropical institutions.
Harry
Foulk

and

and phil-

The office is

equipped

domestic

and

handle

international

banking needs of customers. Peter

Barton, Malcolm H.
Alfred E. Tree have

vaults.

D. Crawford

is Vice-President in

charge, and other members of the
official

staff

include

Walter

made

Dec.

Hollow Country
-

increase

resulting

Y.,

surplus account of $3,-

;,is President of the bank.

the

the Board of Trustees of the

bank.

Vice-President in

be¬

Vice-President in charge of

operations of the instal¬
department; Arthur V.

overall

ment loan

Assistant Vice-President
years' service at the bank,

Royds,
with 16

advanced

was

Vice-Prepidqnt;

Rudolph, former Assistant

F.. W.

Vice-President and with the bank
was

also promoted

Vice-President.

Named Assist¬
Arthur F. Bo-

for
to

years,

ant Cashiers were

Leslie

and

berg

Miller.-' Mr;

joined Merchandise Bank 16 years

President

announces

years,

$7,000,000. George Young, Jr.,

Stevenson

C.
man

Chair¬

years

Plans
and

Miller

increase

the

capital

surplus of the Republic Na¬
Bank of Dallas, Texas, to

and
died on
Mr. Newhall, who was

of age, was stricken on
a
train outside

Florence

15.

Mr.

tional

Company for Banking

Trusts,

Dec.

Newhall,

Chicago;

of the board of the Pennsyl¬

vania

Dec.

sociation

ago.

for

Boberg formerly served with the
First Federal Savings & Loan As¬

over

election of George E. Fenniman to

Mr. Fenniman is

out¬

associated

President,

bank

the

000,000 and undivided profits re¬
ported at over $1,000,000 will put
the bank's total capital funds at

the Sleepy

of the Roosevelt Savings Bank, of

of $12.50
the total

common

Brooklyn,

Accord¬

from 180,000 to 240,000
The "News" states that a

shares.

Presi¬

Club.

Adam Schneider, Jr.,

approving a

standing

at the an¬
Party held the

Christmas

number

dent of trust company,
nual

would

each,

by Andrew Wilson, Jr., Chairman
of the board, following a meeting
of the directors held Dec. 13 and
by Dr. Joseph E. Hughes,

question

shares having a par value

This information

incorporating the most modern
ideas in banking office equipment
and arrangements.
The banking

the

ing to the Newark "Sunday News"
of Dec. 10, the dividend, 60,000

rate from $1.60 to

eight years as President of
the City Council and two years as
a
member of the City Planning
served

came

stock dividend of 33%%.

would

revealed in statements

Vice

ant

Assistant Cashiers,

Schmidt, former Assist¬

Peter W.

with

increase in the an¬

$1.80 per share.

dents and two

will be taken on
when the stockholders will vote

for the fourth quarter of
raised from 40 cents to

45 cents.

$3,Jan. 9,

000,000

was

nual

proposal to increase

saic, N. J., from $2,250,000 to

County

1950

on a

of the Passaic-Clifton
National Bank & Trust Co. of Pas¬

The

Company

Action

the capital

regular stock dividend of
Trust Company in
"Westchester,
at
White
Plains,
:

the

incfyding three Vice-Presi¬

ficers,

five new of¬

Dee.'t 12 selected

Vice-

Assistant Vice-Presidents to

Irving Trust
branch

Fales, President of
City
of New York announces that New■

77th

Philadelphia,

7 * aboard

charge of sales and service of the

Washington while returning from

New York Dock Co.

Daytona Beach, Fla., according to

$32,500,000
Dec.

12- by

were

announced

President Fred F,
the monthly

following

meeting of the directors. A spe¬
cial meeting of stockholders wil|
be held on Dec. 23 to vote on

tho

Volume 172

Number 4970

The Commercial and Financial Chronicle

(2459)
proposed increase, which calls for
the

issuance

ably

share.

stockholders

$40

Leadership 01
Trust in God, Alone!

per

The

proceeds, amounting to
$5,000,000, will be equally divided
between capital and surplus, in¬
creasing the capital from $13,500,000 to $16,000,000 and surplus from
$14,000,000 to $16,500,000. At pres¬
ent

that

Have New

125,000 shares of

additional stock to be offered rat¬

there

675,000

are

owned.

ing income tax

stock

new

for

each

five

and

(5 4/10) stock
Subject to the adoption
stockholders of the pro¬

the

been

concluded

with

investment bankers to underwrite
the

shares.

new

The

for

syndicate

capital,

surplus,

remedy in

had

random

everywhere.

The

happily

the

bankers

appro¬

known

private

were

addition, the stockholders have
full ownership
of the Republic

and

is says on the

couldn't

National Co., not included in the
bank's assets, having capital and

face of

the

most

undivided profits of approximate¬

ly $3,300,000.
000, giving
of the

combined

bank

ous

and

new

company

2,500,-

these

ap¬

proximately $41,800,000.
*

Directors
tional

Dec.

Bank

San

Na¬

Francisco,

t i

26.

the

same

bit

fer of

$2,000,000 from general

serves to surplus,
increasing
plus to $14,000,000.
*

say

are

the

must

the

in India

Guaranty

foreign

have

elected

clearly, and

why

they

fellows

our

get

don't.

musn't be smug
Congressional

though Taft won
Lucas got licked. The

even

that

the

minority

dered if it

still

was

part of the

United States.
For

practical

purposes

line

should be drawn at about 1914 in¬
stead of at the turn of the

divide

the

channels

until

new

thought

1914

century

from

the

chants

Lombard

old

action.

and

the

British* Ad¬

miralty and the bankers and
and

mer¬

Thread-

needle

1.75% to 2.65%, according to ma¬

London had pretty much run the
world for approximately 100 years.

turity. The

There

certificates

sale Dec. 14

award of
competitive

won

sure,

its bid-bf 98.53%.

The certificates

are

Commerce

state

make

Plan. They will be se¬
cured by approximately $7,014,235
of new ,standard-gauge railroad
eqqiphient.
" /

but

some

old

wars,

City of

the whole that Pax

was

much money as they do

now,

were

whole lot

Commenced With World War I

Now
the
an

of Wm. E. Pollock

Harold
elected

Co.

Inc.,

Pine

To Be McCormick & Co.
CHICAGO, 111.—Effectice Jan. l
firm

name

Kebbon,

socialization

Street, members of the New York
Midwest

.will

Co.

Stock. Exchanges,

changed .to
•

tr *

that
now
non-

the

London
bankers had in¬
sisted upon maintaining a balance
between
outstanding credit and
the goods in transit

duction

McCormick
:

under pro¬

against which

loans had

been made. But the huge destruc¬
tion of the first great
war, plus

the

astronomical

which

borrowings

occasioned

states,

commenced

by private inter¬

They had loaned money . pretty
wisely for the rehabilitation of
Europe after the Napoleonic Wars.
They
made
sterling
letters
of
credit the commercial
currency of

sterling

the

was

the earnings were left to
lated

building

invested

globe and frequently

British

talk

Check

there

Taxation

check

Association

Washington

inflation

war,

continue

cur¬

present

planned

basis despite all of the anti-infla¬
tionary talk from the national

loudspeakers.

has

that

tion, and that is the desire of
politicians to get re-elected. That
is

where

When

borrowing

so-called

ernmental
that

in.

comes

"essential"

get

programs

gov¬

big

the accompanying tax bur¬
begins to pinch, we get the

den

sort of

dent

thing

had from Presi¬

Truman

before

the

if they stick to their re-elec¬
formula.

current

subsidize

votes.

couldn't

could

hold

his

the

It's

that

plain that

local

farmers

the

"I'll

rate

the

said

the

That,

unless
out

for

it's

cynical
the

inflation

year

bloody
revolu¬
friends, is sui'~

but

And

our

settle
to

rascals

ing,

of 21/2%

alternative

render,

simple.

one

bankers

subject,
at

team

saved.

higher level of industrial
price parity to insure the farmers'

claimed that not
be

simply

ever

military emergency. He stacked
up
his so-called essential pro¬
grams, cited the cost, and pro¬
penny

up industrial wages
to collect the union
vote, and then

tion."

one

That

keep pushing
taxa¬

faces

new

would

and

kick

can

get in

committed to

new

financ¬

sound

is bound, over
the long term, to go the
way c1
our

currency

disaster.
In

conclusion, I want to add an¬
closely related thought. We
have lived through perilous times
and will live through more.
They
other

times which call for

are

mation

of time

return

tested

reaffir¬

values and

American

first

prin¬

What controls

ence.

credit

situation

national

the

fects

except for

same

and, I grant you, that
a very
great differ¬

make

the

debt

the

and

debt's

that

national

now

size

the

ef¬

management.

The government not only controls
the size of the debt, but also its

Private bankers do
in the Board Of

management.
have

some

say

tury,

perhaps

since

the

things

money

for
which
that
borrowed went up in

was

Limit

the

Borrowing

important

thing

governments found

dominant factor

the

fiscal

national

the

been

was

out

that

was

reflected

not
rate.

the

Politicians

Reserve
field

the

The

victory

long

might

Treasury

the

this

time,

and
well

had

has

very

recent

interest rate

only

Board

for

picture it
which

Treasury

the

about

was

virtually no limit to
what governments might borrow.
Also,
borrowing was a pretty
handy thing politically because it
tax

has

signals.
slight uplift in the

But

was

became

the

called

Now,

there

debt

very

change its mind at any time.
A

So,

current

those
of

contained

the

gold standard

much

foresaken

have a managed
the experts say.

cur¬

were

with.

Under

tax.

this

painful

technique,

oper¬

eating their cake and hav¬

ing it too.
I -think

was

fellow

Choate

from

upbraided
erals

Boston

advent of

still

lib¬

argued that the

income tax

country.

who

so-called

the

because

named

was

the

this

socialism

laughed at, and
still is a subject of ridicule, for
calling it socialistic. Of course, in
terms of the original nominal in¬
tax

come

sounded

was

rates,

happened!

not

far

had

bit

have

must

pretty pessimistic

But

Mr.

from

see

what

Choate

wrong.

was

He just

vision than either

rency,

might

say

than

their

vision

their

kind,

than their

The

their

noses

or,

extraordinary for

can

see

further

prejudices permit them.

income

amendment sim¬

tax

our

voir

funds

vast new reser¬

which

could

years,

with

very

little

pain

view

Boston,

the

taxpayer." My

own

need

the people

fun,

far,

and the pol¬

iticians, and so I don't think there
is much hope for ever going back
to

ceited

they

cusses

say

Men

rules.

old

the

anyway,

are

and when

the time-tested

rules of the gold standard,

until the

debacle.

they

way

And, being

the

are,

situation

and

men

these

trouble,

that

men

but

some

factor

such

ity of the

the

No,

heads

think we

caused :the

extraneous

unpredictabil¬

against

are

say

that what

all

which

new

command

can

men—men

scribed in Sara T.

the

Kind

Wilberfs

timely

poem:

'
.

"God

give

men.

The time de-

mands

Men whom the lust of office does
not

Men

kill;

whom

cannot

the

spoils

buy;

office

•

Men who possess opinions and a

will;
Men

who have

will not
Men

who

honor;

men

who

lie;
stand

can

before

demagogue
And

scorn

his

treacherous

teries without

public duty
thinking."

Unless

elevate

and

find

them

flat¬

winking;

Tall men, sun-crowned,
above the fog

such

our

who live
private

men

and

positions of

we
shall surely have to
only in God, having no trust

power,

trust

in ourselves.

F. P. Ristine to Admit

Weyble and Israel
John

history will

whimsical Joe

mo¬

prac¬

de¬

record that it was not the failure
of

their

need

question will then rationalize the
whole

whatever

well-

will persist in thinking

then they

values

rather than follow the crowd.

con¬

they can manage money

better than could

worth

most

leadership

currency.

much

too

been

for both

the

further

soundness
has

phoney "liberals" who

Finally, I would
we

use

men, making the decisions which
determine the soundness or un¬

see

not

public money so extravagantly
for political purpose if they were
still relied upon. In other words,
we
have
men,
mostly political

his contemporaries or the current
can

could

just

other

which, did we but rest from our
political opportunism, we would

Politicians

doctrine

are

Strong minds, great hearts, true
faith, and willing hands;

ated in times of peace, the
people
could be led to believe that
they

out benefits and defer the

hand

Re¬

have people been as
confused as they are right now.
In this
situation, sound principles
are
dangerously in jeopardy, and

Mismanaged Money

One
mismanaged cur¬
rency.
The hard and fast regula¬
tions of the old gold
standard
have been long since dispensed

could

the

formation,

mentary discomfort
tice might occasion.

Stalin.

fortunes

by Mr. Crider before the Cor¬

Fiduciaries

going

power

peace

System, but ever since the public

blasted

tapped, at least for the first few

Boston, Mass., Nov. 29, 1950.

come

Governors of the Federal Reserve

ply opened

is in

gang

policies
our

the

way

accumu¬

^e reinvested, (hus

long

relation to smithereens and it has
never been recovered since. Most

has

world,

it.

rency.

know

view of such taxes.

over

from

and to make the
which effect the value of
money,

that

been controlled

all

blindfolded citizenship

But

scale directly
Up to World War

with the first great war. Up until
that time money and credit had

porate

contention
money,

Mc¬

Cormick & Co., 231 South La Salle

and

accomplished fact in the

the

ests. The bankers of London were
been* mighty canny fellows.
They kept
of Wm. the account books of the world.

Street; New York City.
M

finance.

vast

has

Marcus

Vice-President

Pollock

Communist

H. T. Marcus V.-P.

forerunner

delphia

All

envelope after Uncle
dipped into it.
This

precisely the

borrow

but they
happier.

and

being issued under the Phila¬

are

were

in the

pretty real and
lovely thing. A lot of people didn't

b^frig offered

Commission

Streets

Britannica

subject to approval of the Inter¬

traditional

from the public.

that

by Halsey, Stuart & Co., Inc. and

the

smoke.

associates at prices to yield from
group

British imperialism

was

government.

being the case, the thing
do is to try to
get the
right kind of men to manage the
for

ciples. But, unfortunately, as his¬
them through will see how un¬ tory amply demonstrates, at such
the
financial
demands
of
that true this is.
values shake
and
If the government times
people
Great
War, microscopic though took over
lose faith rather than regain it. I
every bank in the coun¬
they were compared to the second
dare say that never
since the
try tomorrow the situation would
debacle, forced governments to be
revolutions of the late 18th cen¬
tions

off-year election. And, as for
Massachusetts, a Londoner read¬
ing the returns must have won¬

nations

pretty sure
bit of polic¬

was

earn¬

which, for all of its abuses, was
program within foreseeable reven¬
a
Quaker meeting compared
ues and
Congress wouldn't raise
with the imperialism of the Soviet
the taxes, so the easy road of def¬
Union.
icit financing was traveled once
Prior to the First World
War, more.
governments customarily did their
The
myth is still maintained
borrowing from the private that we have a
private banking
bankers who were in a position
system, but I am sure that any
to see that the borrowers hewed
thinking person who takes the
reasonably well to the conven¬ time to look at the facts and think

ing annually Dec. 1, 1951 to 1965,

debtor

keep its house in order,

Royal Navy

party
gained fewer seats than usual in

ex-

Dec.

our

recent

Scott

fact

certificates, series H matur¬
on

the

elections
and

Offering of $5,595,000 St. LouisSan Francisco Ry. 2%%
equip,

made

when

Incidentally,

was

getting

the

over

Halsey, Stuart Group
] Offers Equip. Tr. Clfs.

Inclusive

open

been

elected

je in India.

trust

inability to

picture
perhaps
that's

Union
Bank
Ltd.,
Banking Corporation
Ltd. and The Hooghly Bank Ltd.
The amalgamated bank will be an

else

to reality. The fellows who

seen

Comilla

dealer

source,

all

in confront¬

have

The Comilla

authorized

for
am

eyese

Trust Company of New York. They
are the Bengal Central Bank
Ltd.,
The

that above

realistic

tions. One of the greatest troubles
with our clan has been our unwill¬

Ltd., according to advices received
Calcutta

what

ing the current and future situa¬

sur¬

become the United Bank of India

from

synonym

re¬

of merging to

process

to you may appear a

believe

Four prominent banks

thing.

radical, considering its

but

ingness
1

Crider

Republican,

to be

seems

same

going to

the directors authorized the trans¬

myself

which

time,

j0hn

fellows,

the

value capital stock, pay¬
able Jan. 2 to stockholders of rec¬
par

Dec.

conserva-

v e

and

declared the 60th regular
dividend of $1 per share on the

ord

perilous

Most of you
are

First

$25

Tariffs

eliminated,

the

their

days.

Crocker

something

mindful

worth

down
of

one

ing. That

have to be

held
if

to show up and do a

currency,

The bank also has

for contingencies of

numer-

govern¬

wide open.

were

for

London

even

That

tion

to it that the channels

saw

of trade

our

influential

were

ment,

has

flows

came

the

folk

and the governmental license that

not to Wall Street, but to
Washington. The British bankers,

going to hap¬
pen.
In
God

Trust,

world

working
much

Get Right Kind of Men

even

cycle

doubt whether many

pay

makes

comes,

who

was

the

Sam

for credit in those days as it now

undivided profits of the bank will
be approximately $36,000,000.
In

reserve

But

about

how

leadership to lead nation.

new

talk

this

anything I could have

what

and

selected
of

thought
I

title

out

priated

Company; and Dallas Rupe & Son.
Giving effect to the proposed in¬
the

the

turns

will be headed by Walker, Austin
and
Waggener; First Southwest

crease,

title

the

away from the new kind of
money

management.

the

that interests them is what is left

was

system. Sees only
The

takes

before

money

ings go

group

so-called

government

average

know

first step toward Socialism in this country,
and contends it is myth that U. S. now has
private banking

posed increase, arrangements have

the

system, under

completed

mania.
the

tax

by
which
the
central
government
could go hog-wild in its
spending

1, finds the new
"managed money" policies permits extravagant spending and
borrowing by governments, and thus, in absence of gold stand¬
ard currency, is leading to continuous inflation. Holds
adopt¬

one

the

it,

sees

Editor-in-Chief, The Boston "Herald"

advent

victim's

Prominent Boston editor, noting
revolutionary economic and
financial developments since World War

four-tenths shares

which

By JOHN H. CRIDER*

stock outstanding.
The proposal
provides the right for each stock¬

holder to subscribe for

the

pay-as-you-go

batting

our

stone wall if we

seriously believe we can ever get

Weyble and Henry Israel

will be admitted to partnership in
F.

the

Ristine

New

Jan.

Both

headquarters
York

Co..

York

members

Stock
will

the

Exchange,

make

firms

their

New

office, 15 Broad Street, with

which Mr. Weyble has been asso¬
ciated for many years. -

December 21, 1950

The Commercial and Financial Chronicle... Thursday,
28

(2460)
healthy addition to the national

trend of reduced construction ac¬

Housing Situation

The FHA and

looked that in the event of fore¬

tivity has begun.

closure and payment

inventory of dwelling units.

physical security to liquidate
before calling upon reserves.
As

Present Market Demands

FHA Chief reviews
and

taken to

measures

assure

rupting effect, a larger part of new

the

War

substantial reduction in new

Estimates 4V2 million homes have
World War II. Says emphasis now will be

residential construction.

directed

been built since

market.

defense

Korea

The Situation Before

international situa-

the

Before

units.

dollars

measured

six

months of this

tors at the

volume

lar

present time, it appears

Overhang on the Market

for

corre¬

Another

have had

record volume

area

ment of

Franklin D. Richards

period of last

activity was at
a peacetime high during the first
half of 1950, whether measured

our

and needs better housing.

demands,

us |hIJ
ston
10 an aDruPc st p.

eration

A great deal of planning goes

housing developments and
projects going up now were
planned even before the Korean
tion,4 there was the inflationary situation. The FHA at the present
aspect of the rising level of credit time has commitments outstandand
the fact that the prices of ing, under Section 203 alone, in
building materials had been going the amount in excess of $2.5 bilup since the summer of 1949.
ii°n.

the

this
new
peak in construction
activity involved heavy demands
In addi-

into

are

housing at strategic defense plants.
It

nel

into

production

that

houses

actually needed, rather than
higher cost housing where the de¬
are

mand may be created
motional efforts.

60-day

the

is, I believe, particularly sound
a time like the present to chan¬

should like

briefly,

mention,

Like¬

War II.

through pro¬

situation

The

changed

In the building indus-

Korea.

try there

arbitrary proviso
^
cause

practical. You

our

of
financial statement, which, in

opinion, indicates a sound con¬

activity and the in lation

the

tfcimtTfuture

needs rather than

Housing Administra¬

Federal

which last June passed its
16th anniversary.
The FHA has
insured approximately $22 billion
in home mortgage and property

t0 conserve the authorization and

improvement loans made by pri¬
materials.

defense

that

ample supply of credit was
available and as costs increased
and material shortages
it

became

that

inflation

curb

materials

developed
apparent

increasingly

action should be taken

some

and

conserve

the

needed

vate

nQt

uged
promptly should be recaptured. It
is

the

builders,
the

that

going

interest

are

has

defense
y
Cutback in Volume

„

The

first

The

action

corrective

taken at the request of

was

July.18.the FHA announced credit
applications

effective

for

filed after July
FHA credit controls

froze

Strurtion mst fif*urp<=

and^ reduced

loan

value
value,

yTT '
Under

the

to
to

the provisions

con-

Tnlv l

ratio

loan
loan

or
or

all

insur¬
These

ance

1950

mortgage

cost
cost,

of the De-

fense Production Act credit curbs
were

extended to conventionally-

financed

mortgages

Oct.

12.

FHA regulations were amended at

the

same

strictions

time

conform,

make

our

far

re-

possible, with Regulation X of the
Federal Reserve Board.

The July

apply

FHA

amendments

applications

filed

and

after

July 19 through Oct. 11 under all
sections of the National Housing
Act, other than for military housing.
The Oct. 12 FHA amend-

credit

recent
designed

to
reduction

the^Pres- stantial

ident of the United States—and on

restrictions to

were

construction

restrictions

assure

new

year,

subhome
com-

pared to what has been done this
year#

Results of the Bureau of Labor

Statistics' survey

new

me report to you on
experience with respect
Even taking into con¬
sideration the fact that the FHA

the

FHA

losses.

one-fam-

survey,

which covered the last six

months of last year, shows that
three-fourths of the purchasers of

financed

veterans

and

made

down

that'

were

them

payment.

houses
half

...

?i?r in^erestinS fact brought
i{J «7Snnn'e3LWi*Si nnn
?es
n

$7,000 to $10,000 price
?™ket® ^ere the most popular
®
£ k°th veierans and nonveteransFor the first time this year, private residential starts in October
(101,600 units) dropped below the

mortgage loans insured un¬
der the present regulations bear
2V2% interest under all sections
the

apply to applications filed
apply' to

and after Oct. 12 and

present time
the debenture liability of the Ad¬

tures

meet its

charges
I

*An address by Commissioner Richards
the
Mortgage and Real Estate

before

Forum

the

Mortgage and Real Estate
Department of the New York Savings
Banks, New York City, Nov. 28, 1950.

have

serves

you

Acquired Properties

paid

ment

Seem

appear

that

the

are

our

re¬

sufficient

postwar years. The major excep¬

having

private life but
difficult time find¬

returned

had
were

ing shelter for their families.
The terms

the

under 608 were lib¬

Congress did not include

eral.

the

law

economic

soundness

stipulation that has always been
proviso of the long-range rental
housing program under Section
207, but rather, the law was made
to
read, "an acceptable risk in
view of the shortage of housing."
a

have

give you a quick sum¬

units

been insured.

invested

needed

rental

housing projects.

sold have shown no loss.

issue new-con¬

struction commitments under Sec¬

expired on March 1, 1950.

Although
has insured

the

hand only 1,682

I do not
case

and

believe this will be the

certainly the record so

far does not

indicate it.

We have found that defaults are

usually more apt to occur in the

to be

written

off—through

has

now

prepay¬

amortization—and

like¬

wise, the fact should not be

over¬

time goes on and the

that

new

projects become well estab¬

lished, and well managed, there
may well be fewer rather than
defaults.

With insurance

405,000 units,

is logical to assume
that there will, of necessity, be
some acquisitions.
We know that
city growths do not always de¬

however, it

velop
that

experience it would ap¬

pear

that

insurance

our

as planned. We know indus¬
change plant locations and

the

measurement

of market

exact science.
best judgment
that the 608 program as a whole
represents needed housing, and is
absorption is not

However, it is

from

the

localities

properties

were

important. The policy of expedi¬
tious disposal

of properties, which

general has been followed to

date, therefore has seemed logical
and has been a factor in keeping
losses to

minimum.

This policy

will be followed as

present favorable business
conditions prevail. If at some time
in
the
future
these
conditions
as

be relied on
Admin¬
istration would not participate in
that the Federal Housing

dumping properties on the market,
occurred in the years

(3) Only 72 projects (with 4,880
units) have been acquired by the
Administration.
Those already

tion 608

national
point of view the number of
properties acquired by the FHA
was negligible, in their respective
Although

tion.

should change, it can

(2) About $2.9 billion of private
insured by FHA has

been

infla¬

existed and to contribute to

long

of the 608 figures:

investment

tries

half

places during the war and

talked-of tions to this situation have occurred in these war areas where
program of the FHA is Section
declined after the
608. As you may recall, this pro¬ employment
war
and
families
moved away
gram was originally designed for
' *
the
purpose
of stimulating the •leaving a surplus of housing.
For the FHA to have withheld
production of war rental housing
and later adapted to postwar con¬ properties from a rising market
would have served needlessly to
ditions
to provide much-needed
rental housing for veterans who
aggravate shortages where they.,

with the amount of
almost

Policies

most

the

Probably

consider the relation¬

reserves

the

WOUld

revenue

written

ance

been

*OL

they mature.

ship of the total volume of insur¬

taled 39 30D unite anH fViio

,„ac

other obligations and

confidence that

and

The FHA starts for October to-

^ «59,.5UU Units and tniS was 0 /o
under the September total. It

particular

to meet losses and pay operating
costs. It should be borne in mind

the

figure.

the

insurance fund will be sufficient

when

1949,

called

been

many

early days of a rental project
mately $35 million. However, it where sponsors are not experi¬
is the policy of the FHA to call enced managers. If this continues
these debentures when it appears
that after payment of the deben¬

not

ing one, with critical shortages

VIII

ministration amounts to approxi¬

comparable month in 1949. This
*s 81/2% below the September
starts and just slightly under 300
October,

At the

Act.

sell

followed to date have
based
on
such appraisals.
rising real estate prices
Since
the
inauguration
of the
and high incomes, I believe we
mortgage insurance program, this
can be proud of our record.
As of
policy has for the most part meant
March
1, 1950 the Administra¬
prompt disposal of properties. This
tion's losses on the total amount
is the case because, for the coun¬
of all types of insurance written
try as a whole, the real estate
were
% oj 1%.
market has been an ever improvr
riod

ment 16 years ago,

with

units—the

ments

over

those conditions.

operating during a pe¬

been

has

Administration
over $17V2 billion in
$12 billion of insur¬ mortgage loans since its establish¬

in force.

decision

particular time is made
in the light of a prudent appraisal
of current market conditions and
the effect of alternative policies
sell

there are now
properties and
We have paid operating costs
the 72 projects to which I have
out
of
income; authorized and
I
paid dividends of about $23 mil¬ just referred.
Much has been said and written
lion; and have built up reserves
and capital in the amount of $242 about the 608 program. Its emer¬
million.
gency nature and large volume
Of the FHA reserves, a little has given rise to a great deal of
over
$231.6 million are invested speculation. Some observers have
in U. S. bonds and the account predicted that many of these ren¬
tal
has an average yield of 2.44%.
projects will eventually be
Debentures issued in connection acquired by the FHA.

home financing in nine metropolitan areas §ive an interesting
sideliSht to the credit curbs. The

mortgage

possible, let

III

Credit Curbs

little

ance

plans.

billion lent by about

tization and

canceled,

factual

The authority to

18,000 institutions, a large percent
been paid off through amor¬
prepayments leaving

as to the interest
that commitments
not going to be utilized

FHA,

should

country.

Of this $22

well

lending institutions through¬

out the

and

lenders

market.
The

order

(1) Approximately 405,000

tion,

an(j desirable, in order

necessary

petitive terms and to endeavor to
contribute to the maintenance at
all times of a firm real estate

dition.

Position

bankers, you will be inter¬
ested in the financial position of

appreciate that

can

Financial

FHA's

The purpose is purely

jneqUities.

deben¬

all approved mortgagees a copy

mary

•.

wanj.

nQj.

This1sharp° increase in with the large outstandingTitle 11
This sharp increase0 i
volume of it is
commitments

sSuSfon

struction.

business

evidence of panic

was

and

FHA

that

guaranteed by the United
Recently I sent

which

principle

general

FHA's property manage¬
ment policy is to dispose of all
acquired properties promptly at
fair market prices and on com¬

„

This is not

diately with the outbreak of war
in

VII

The

guides

Treasury.

Let

Sent™ daUSe °" ™A C°m"

Conditions Since Korea

Property Management Policies

are

provision

tures

wise, there is comparatively new

many

for labor and materials.

In this connection, I

World

since

units

housing

million

built

Naturally,

take into consid¬
fact that there have

we can

been

in units.

present market

considering

yearTconsiruction
or

of market demand

possibilities, this seg¬
population is seeking

ployment

that already has exceeded the
previous record year of 1949 and

year

sponding

in dollars

in¬

Slowing down the tremendous I want to mention is that of hous¬
production of housing is going to ing for minority groups.
With
be gradual.
This is only natural improved incomes and better em¬

was

above

the

will be utilized to

extent.
This mortgage
insurance plan is especially well
suited to outlying areas.

billion,
35%

likely that the small
under Section 5 of

seems

Title

reached

h ic h

creasing

nearly $7V4
w

price

lower

the

selling within 30 days.

are

homes program

ord level. This

level

houses

range

unit starts might

rec¬

that

estimate for 1951.

mortgage re¬
cordings at¬
tained

late as the first of this month,

possibly 800 to 850 thousand
be a reasonable

that

nonfarm

construction
Considering all fac¬

year.

priced

payment in the lower cost
house and our directors reported,

residential

new

and
house

greatest

moderate

down

substantial reduction

assure

the dol¬

year

restrictions are designed

These

During

first

the

even though the
application
peacetime high, filed subsequent to Oct. 12.

housing in

plans for 1951, from reports I have
received, are focused on the lower
priced house. Under the present
credit curbs there is a relatively
smaller increase in the amount of

structures,

multi-family

in Korea, construction

arose

activity was at
whether

ing

need

naturally uses less material than
the luxury
residence.
Builders'

the financing of one- and twofamily dwellings.
The July 18
amendments apply to the financ¬

the field

the

also

said,

reserves

States

the

which

sound condition.

lower-priced

the

into

This

small homes and efforts will be made to balance
needs with civilian requirements. Reports FHA in

placed

tion

results
and have the least possible dis¬
to get the best

In order

housing conditions since Korean

new

confident that our
adequate; however,
the soundness of mortgage insur¬
ance is even further reinforced by

residential construction should be

Federal Housing: Administration

Commissioner,

the

RICHARDS*

By FRANKLIN D.

in the first instance,

the FHA has,
VI

of insurance

our

of the last

depression with such chaotic re¬
sults. At such a time FHA would(,
to

greater extent, exert a

even

market

estate

time

the real

influence on

stabilizing

would

the

and

same

the

protecting

safety of its insurance funds. This

possible because the FHA does
have to put acquired proper¬
ties on the market nor do mort- i

not

hold insured mort-'
instead of dumping the
properties the Administration is-i
who

gages

gages, but

sues

debentures to the mortgagee

and

takes

the

property

ex¬

change.
The

guide the

procedures that

operation

property

the

man¬

agement program have been der
veloped through experience and
characterized

are

flexibility
,
'

and economy.
These procedures

emphasize the

importance of the role played by
private enterprise. The repair and
improvement of properties, their
management
and

and

maintenance,

their

sale, require the cus¬
tomary services of private enter¬
prise and conform to prudent
practices. In selecting the services
of

private business organizations,

it is

our

policy to

see

that all in¬

terested and qualified persons

and

firms should have

equal right to
compete for government business,
without favoritism, and that the
government should have the bene¬
fits which flow from competition.
X
Plans to Utilize Cutback Period
I

feel

ample

that

the

what

FHA
can

ex¬

accom¬

plished by government and indus¬
try working together.
The

objections of the National

Housing Act

set forth by Con-

^Volume 172

Number 4970,.

gress

vital

The Commercial and Financial Chronicle

(2461)
today as they
16 years ago, although con¬
have
changed
greatly.
are

were

Continued

from

page

The credit
currently being used by
business should be transferred to
defense production as civilian

ditions
These

objectives

and

were,

are,

(1)
in

home

crucial in the fight to
protect the
dollar.

provide

adequate

Many

financing system to make
housing accommodations

influence in the mortgage and real

time

when

national

defense

ward

devising

well

economy,
to

lay

the

housing can be made
industry as well as

you

were

within

asked

cre¬

toward

have

Reserve

Board.

the

has

For the time being at least, our
problem is how to evolve

including

Let

word

say a

the best possible balance between
defense
needs
and
civilian
re¬

significance
they
have

quirements.

understood. There is much

This will take the full
coopera¬
tion of government and

these

Commissioner

pledge

best

our

not

moves,

been

actions than

small

rise in

discourage

also

buy

these

securities

further

from

bile
Thomas. G. Campbell
\

has become associated with them.
has recently been
Bruns, Nordeman & Co. In
the past he conducted his own in¬

New

York.

the

come

defense

banks

;PMIa^SeeSiAss'ir

nomination
year 1951:
President:

following

officers

Franklin

for

the

Ford,

Jr., E. W. Clark & Co.
Vice-President:

Russell

Er-

good, Jr., Stroud & Co., Inc.
Treasurer:
Raymond £. Groff,
Brown

Brothers

Karrirnan

re¬

the

Board

Gov¬

These

time

same

the

Administration

Veterans

Administration

regulations

new

produce

credit

the

Housing

the

issued

designed

similar tightening of

Federal

under

regulations

programs.

designed

were

activity

that

assure

defense program

ma¬

would be avail¬

able when needed.

the

extensions

officer

every

Association

your

serve

for

three years ending 1953; William
Ellis Coale,
Eastman, Dillon &

Co.; James T. Gies, Smith, Barney
&
Co.;
Lewis
P.
Jacoby,
Jr.,

matter

the

men

the

who

meeting and to
is

gravest

concern

initiated

this

The blunt truth

us.

that, thus far, appeals and vol¬

Baker

action

enlist

bank, in

every

this

country

with

Bendix, Luitweiler to
Admit L. G. Gerald

responsibilities

further

moves

private

bankers

both

and

public servants. They

you

are

for
as
as

inescap¬

able.

action

certainly

an array going
important results can

accomplished.

the reduction of credit

loans

on as

many

possible that really counts.
Reductions of $500 here, $1,000
as

millions of customers

produce

can

substantial results.
*

We know you must stand ready

legitimate credit needs

of your customers. But how
many
loans have you made during the

past

six

really

months

that

essential?

required
have

the

full

borrowed?

how

many

needs

amount.,
In

not

were

have your customers'

cases

how

they

fnany

would their really legitimate
needs have been served with 20%
cases

less,

at least 10% less? In how

many

cases

have ybu renewed

market that is reflected in the rise
of

prices, wages, and costs in
general, and in the scarcities that
This does not
dollar

should

bers of the New York Stock Ex¬

must do to meet this situation. So

change, will admit Louis G. Ger¬
ald to partnership on Jan. 1.

straint

here to counsel together

are

what you can do and what we

far,

the

approach

voluntary

cies

have

|of

the

will

de¬

fended

whether

and

the

strength
which is
hope and safety of the free¬
dom-loving peoples of the world,

will be maintained.

May

agen¬

needs

been

substantially re¬
have
already
to bring about an

play

you

and

courage

role

your

vision.

The

initiative

your

contribution

with
world

and

your

before.

never

Measures

adopted

curtailment

this

credit

doubtedly still

Farwell, Chapman to

the amount

outstanding.

Un¬

done

can

Admit 2 New Partners

in the governmental field but the

major credit problem today is in
the private field. That is where
the

great
place.
We

dollar

the

times

by the various government

expansion

has

CHICAGO,
111. — Howard
Emig and Francis C. Farwell
Jan. 1 will become partners

taken

Farwell,
all in this boat

are

together.

South

Your responsibilities and those of
the Federal Reserve System are

Stock

inseparable. Neither

been

you

nor

meet our responsibilities suc¬
cessfully without close and under¬

Chapman
Salle

the

can

New

York

with

the

Co.,

Street,

203

members

and

Exchanges.

A.
on

Mr.

Midwest

Emig

firm

for

ha:*

many

as Manager of the munici¬
pal department.

years

....

standing
Your

teamwork

role

between

have noted in the past that

exercise

your

judgment

K'~i!

t'j

..-i

us.

indispensable Oecause you help to shape the busi¬
ness leadership in this
country. I

D. MacKinnon Opens
Donald

When ing

you

individual

MacKinnon

resum¬

the investment business from

offices

really decide
who, among all the applicants for
credit, will be financed. In mak¬
ing that decision in the past you

York

1775

City.

formerly

Broadway,

Mr.

head

Kinnon &

New

MacKinnon
of

Donald

was

Mac¬

Co.

are

that

mean

really

business
will

But

they

how

the

many

receiving

are

receive

defense

new

bank

borrowing for one purpose
another. Such additional credit
should

proceeds

existing loans

credit

re¬

volume

basis

has

our

the
as

out

the

repayments

they fall due. The

of credit

banks

met

that

each

turns

day

that there

over

huge.

intangible,

well

are

the customers which you have now, think back over some of

.the transactions which

will

have had in recent months, and

you

that all of them fall into the

see

you

following categories:

Fear—This

is probably the strongest reason why people buy
The urge to protect oneself against the uncertainties of
the future is present in every normal person. Saving and accumu¬
securities.

lating are always the dominating influence as people grow older.
They save for the time when they can no longer work or when
illness may strike.
They accumulate property which can bring
them the feeling of security, and without which they are uncertain
and fearful for the future.

Today, people are turning to tangible
property and securities in their fear that the purchasing power of
their dollars will further decrease. If you can discover the inten¬
sity of another's "fears," you can direct this strong emotional urge
into channels where your selling efforts can be directed in the
most efficient possible manner.

Vanity—How many sales have been made in thy name.
The
desire to live better, to have more, to outshine the other fellow,

others, but all of us

may be more apparent in some of us than in
have the disease to a greater or lesser degree.

You

may

recall the

occasions when you visited new prospects in their homes and spent

time admiring the flower gardens, or the furniture, or even
new heating system.
Or do you remember the many
occasions when you have listened for hours to some of your good
customers, while they related stories about themselves which
your

the

brand

otherwise you would have ducked like the plague.
even

knew

Many people
buy securities because it makes them feel important.
I once
retired engineer who was

field.

He finally settled down in

brilliant

success

in his

own

house and the ownership
of about $150,000 in cash and securities.
He set up a work table
in his study.
It looked like he was starting out to discover all the
financial secrets since time began.
He had three or four financial
services, he had charts on his wall, annual reports were neatly
filed in a rack nearby, books on investments filled his book¬
shelves—all he needed

way

Then

must

question that

concerns
soon

see

ever

was

cozy

Dow Jones ticker.

sell him—that

was

buy!

comes

our

There

was

only

to let him- talk for about four

then he would

will

only three basic emo¬
tional drives which prompt people to acquire anything. Check up
you

single

matter

may

tangible articles,

credit

orders that will require increased

needs

By JOHN DUTTON
If you will look behind the sales of both

hours and tell him that he certainly knew

essential

refused.

inflationary,

important

Securities Salesman''s Corner

one

remember
that
in
inflationary
periods all additional credit dollars

Bendix, Luitweiler & Co., 52
Wall Street, New York City, mem¬

been

tha

of this economy of
ours,

ex¬

when this has been true. The facts

duced.

whether

army

officers. With such
into

definite

have

been

are
that since June the
budget
has been in approximate
balance,
and that new extensions of credit

anti-inflation drive.

are

There

also

making
will

you

determine

all

original
borrower.
Even
credit
untary efforts have not been sufdollars obtained by the original
Co.; James J.
ficently effective to hold the line. borrower for
Mickley, Assistant Vice-President,
defense
purposes,
That is the reason we are meeting
Corn Exchange National Bank &
when spent, get into the money
here
today. Gentlemen, this
is stream.
Trust Co.
truly a critical situation. There
There is

Thayer,

credit has

today,

value

Everyone is
charge that gov¬

conscious of the

decision

much

that

We have thousands of banks in

spite of all these actions and
appeals

that

pervade the market today.

by the bank supervisory agen¬
cies, credit still expands. This is

for which it is famous. In

ef¬

extended loans when a part, or a
help reduce the currently high
larger part, might have been paid
inflationary pressures by restrict¬
off? The sum total of these mar¬
ing the demand for funds in the
ginal amounts has swelled the
mortgage market and through the
money supply and added an, in¬
reduction of new home construc¬
crement of buying power to the
tion

enterprising, economic

should

point.

you

terials and labor required for the

final

panding.

inflation.

credit

can

contemplated

credit

to meet the

and

Thayer, Baker & Co.
Governors

be¬

with the concurrence of
the Housing and Home Finance
Administrator,
placed
curbs on
private credit for real estate con¬

For

substantially

Oct.

Co.

Secretary: Lewis P. Jacoby, Jr.,

had

program

ernors,

and

Receives New Slate
the

not

agreement

collective

your

credit.

strictive.

Federal

PHILADELPHIA,
Pa. — The
Philadelphia Securities Associa¬
announces

whether

see

avoid

ernment

irrespective of size and to

take

and

evident, the regulation

made

was

struction.

tion

that

the extent of the there, and $25,000 some other place
inflationary pressures growing out by thousands pf banks serving

Camblell

with

vestment^ business" in

credit

On Oct. 16, after

Announcement
ismade
by
Brady & Co., 52 Broadway, New
York City, that Thomas G. Camp¬
bell, authority on railroad finance,
Mr.

automo¬

instalment

other

and

.payments

agree¬

by the larger institu¬
screening larger loans. It
is your problem
today to develop
ways
and means to
discourage

instalment credit through Regula¬
tion W. This regulation established

down

possible

way

primarily

curring some penalty.
On
Sept. 18 the Board reinstituted
regulation of consumer

maturities

the

tions in

able to sell securities without in¬

maximum

back.

growth in total bank

pro¬

virile,
leadership

such loan agreements will be used

selling them prior to maturity to
get funds for making other loans.
When yields rise, banks are un¬

minimum

loan

reached.

self-

banks

written

he feels it

ference

such securities induce nonbank

and

that

fective

supporting. Resulting higher yields
investors

support

conjunction with Ken Cravens,
a
meeting has been arranged in
New York shortly after this con¬

by
making the market for short-term

warm

in the money supply.
Restraint
is
accomplished

Reserve

essential to the defense effort.

and

securities

Federal

cut

not

yet been used.
experience with it. It

the

expansion

purchases supply bank re¬
serves
and provide the basis for
a sixfold expansion in bank credit

government

the

has

ments among financing institutions
which would aid in
checking any

Such

Thomas G. Campbell
Joins Brady & Co.

between

voluntary

generally
more

encourage in every
the making of

for

is to reduce Federal Reserve pur¬
chases of government securities.

this

respect.

these

the

interest rates. One main objective

industry.
FHA,

the

efforts

agreements

desirable, be¬
cause
of the inflationary condi¬
tions now existing, to assist and

extending other types of credit.

basic

anti-trust laws

Attorney General. He has

sales by banks to obtain funds for
,

may

One

been

We have

short-term

securities

government

facility that

actual

assigned

directed
to

part.

your

jectives of the Act. The admini¬
stration of this provision has been

provide

discouraging sales

Federal

Conclusion

been

ex¬

financial institutions and the
gov¬
ernment in furtherance of the ob¬

authority if necessary.
that
time,
open
market

operations

a new

voluntary

additional
Since

individual

exempts from the

frame¬

through

credit

the Defense Production Act which

com¬

orderly government
market; and that Con¬
be

credit

both

the

be useful. I refer to that clause in

prepared

the

your

do to restrain

can

We have

Open

at their

that

primary question
today is what further

and collective action

exces¬

and

The

pansion

would

gress

necessity.

asset

the

Board

means

expansion

cutback

necessary

all the

work

low cost field. I
believe, also, that
should work toward improving

before

even

clearly

was

the

securities

techniques and procedures

that

use

dit

improving the quality and design
housing — particularly in the

our

early date

loans

know

now

effective.

signifi¬

mand to restrict further bank

that

Market Committee

to¬

means

expansion

sive;

be¬

plans

and

ways

System.

and
individual

duction
restrict

you

competitive situation is such that
this approach is not
sufficiently

announcement. It stated that

that

are
looking forward to reducing
housing production in line with a

lieve

basis.

Aug. 18 the Board approved
increase in discount rates from

the

present

initiated

through appeals to

all other lenders

inflationary

been

V'i % to 1%% and made

cant

estate markets.

the

been

On
an

stabilizing

have

the Federal Reserve

available for American families;
(3) to have the insured mort¬
gage system exercise

counter

measures

suitable

Banking System

improvement

encourage

housing conditions;
(2)

pro¬

Inflation and the

threefold:

have played a vital part in
viding this country with the

what he was doing—•

•

old

friend

Cupidity.

some

this

desire is very strong.
The age-old urge to get something for
nothing—to do it the easy way—you may joke about it and con¬
demn

it, but it is something that is with

us come

what way.

Most

speculation that is denounced so freely, whether it is of the
two dollar horse betting variety or on the commodity or stock ex¬
of the

changes, spring from this normal human instinct which is based
upon

greed, and the desire to "get more."
Reformers may talk
things and denounce all forms of speculation, but as

about such

salesmen

we know only too well that practically all the thousands
nondividend-paying stocks, or untried new ventures which are
offered to the public, are sold only one way, and that is through a
direct appeal to "Cupidity."
In fact, the world would have

progressed little indeed if it wouldn't have been for
maligned instinctive impulse which is in all of us.

this much

Fear, vanity and cupidity—watch for them and use them in

making

They

sales.

emotions play

are

always present.

part in creating "action."

Sometimes all

three

At other times one or

the other

dominates, but it is just the same process over and over
again in sales work and that goes whether you are selling houses,

automobiles, television sets

securities.

;

The Commercial and Financial Chronicle

(2462)

Continued from

The matter really is not as difficult
misconceptions would

subject of inflation.
or

elusive

the many popular

suggest.
War and

Inflation

that is large scale war, has always
associated with drastic increases in prices. Human

Historically
been

war,

this will
conditions in peacetime would

being what it is, it is rather likely that

nature

The

always be true.

same

without much doubt result in the same increases.
cumstances such as are now

In cir¬

depend

the nature and vigor of measures taken

upon

rate

of,

Profits retained

era.
or

the

business

less certain to accumulate in cash

are

likewise

what is

while

commonly

regarded as the equivalent, for the simple reason that
opportunity to invest them in the business is severely
limited.

mobili¬

full

this production

handle

can

but it will require hard

It will

require

changes

to make a lot
ordinary ways

doing things.

our

fourth

big job. In order to build the mili¬

need, we-will
production

strength we
to expand

tary
have

our

greatly. We must also prevent in¬

^nd stabilize the cost of

flation,
living.
If

have

to make the weapons

are

cut

back

civilian

shall

many

lines

enough,

soon

production.

But

tion

for

the

sake

argument we may for the
ignore these factors, and concentrate our atten¬

strictly

our

the ordinary

upon

and his altered
Substantially more

consumer

all-out defense economy.
than half of the national income takes the form of wages
status in

and salaries and other

this

flows

into

the

compensation of employees. All of

hands

ordinary consumers. This
flow is enlarged by the payment of dividends and profits
distributed in cash by unincorporated business enter¬
prises. Now as rearmament is pressed, we shall probably
increase the flow of cash to consumers despite the current
state of "full employment" and the like about which we
are so much
disposed to boast. At any rate, we are hardly
likely to reduce it appreciably.
Now the flow of

and maintain our
the industrial
strength underlying it simply by
cutting back civilian production.

armed

might

must

and

produce

—

sumer

are

presumably to be reduced

Indeed the President and the others

considerably.
Washington are

very

repeatedly harping upon the extent of this reduction*
Indeed, if there were no such reduction, then the flow of
cash

the

consumer

would

by the rearmament effort

very

greatly enhanced

unless, indeed, both peace¬
time goods and wartime
goods are produced without an
increase in the wages and salaries bill, which is
hardly
probable. The hard, cold fact is that given the circum¬
stances
as

copper,

num,

electric

power,

cotton,

—

actually existing, any such rearmament program
planning, plus all the things we are planning

are

control

nounced

called

hours.

work

upon

and

women,

people and older workers
in our plants and

will be needed

factories. Farmers will have to set

stantial
him.

part of the income of the

The

undistributed

income), but the amounts
are

much

lend

consumer

away

general reasoning, of course, applies to
profits (which are not a part of consumer

are

much smaller and the funds

likely to be devoted to

support to the rearmament effort.

purposes

Now

which

there

are

will

the imposition of
controls,
including
roll-backs, where needed.

later date.

The most obvious is
more

taxation, and it
vigorously than in the past. It

not

al¬

this

effort, there will be

increased

trol

the

central

for

need

over

with

ahead

move

mobilization

government

many

activities in this field. According¬

ly, I

establishing

Mobilization.

Defense

Office of

resigning

ap¬

President

Electric

General

Must

Prices

Hold

Company to

job. In his new position,
he will be responsible for direct¬
ing all the mobilization activities
of the government, including pro¬

procurement, manpower,
transportation and economic sta¬

duction,

A defense effort of the

will

undertake

now

size we
inevit¬

push prices up, unless we
take positive action to hold them

ably

down.

with

defense.

'We have already taken a num¬
restric¬
credit

increased

will

Congress

profits

buying. We

taxes.

tax

hope

enact

this

further taxes will

have
the

that

excess-

session.

Still

be needed. We

also moving
preparations
for
have appointed

former Governor Millard Caldwell

Florida to

be Federal

Civilian

addition,

recom¬

legislation to the Con¬
will authorize the
Federal government to help states
which

cities

and

civil

their

preparations. I hope the Congress
will enact this legislation soon, so
that the civil defense work which

has already started can be

our

speeded
These

are

greatly

up.

hold

can

prices down. I have

the Congress, to put the increased

nearly

have

also

instructed

the

Di¬

non-military expenditures in the
Federal

new

budget to the mini¬

required

mum

give

effective

support to the defense effort.
The
tioned

taxes

measures
—

I have

credit

Sometimes

reduced

and

just

men¬

higher
non-military

expenditures—are essential. They
are

our

sources

move

into

of inflation. But

as we

greatly increased de¬

fense effort, we must also take di¬
rect

line.

measures

keep

prices

must

freedom

may

means

danger.

the

air

the

dom

schools, in
our

Those
be

our

work and

right

our

us.

breathe.

our

churches. It is in
government and

our

vote as we please.
the things that would

are

from

taken

Free¬

homes,

our

has

down

our

already begun
industry. It is

troops; it is holding up equipment

fighting forces; and our
population, has begun to
suffer. This strike is a danger to
the security of our nation.
our

civilian

commander-in-chief,

there¬

the union and its
striking
members
to
return to
work immediately.

fore, I call

upon

I ask you men

realize

serious

are on

believe

nothing can excuse the
are adding to your

are,

that

fact

strike
matter how
your griev¬

who

that,

you

country's danger. I ask you, in the
name
of our country, to return

immediately to
set

by superior num¬

all. Attacked

post of duty.

your

fighting men in Korea have
example that should inspire

Our

bers, and in the bitterest of win¬
ter

were resolute,
determined.
Their
courage in the face of

and

steadfast

is one of the most

reverses

stories in

his

each of us
efforts,

ahead,

days

his

measure

own

sacrifices, by the standard

own

heroic

our

heroic

country's history.

our

the

should

they

weather,

steady

men

in Korea.

who are young
people will serve in the armed
forces of your country. Nothing
Many

you

will do later in life will be of
benefit to your homes,
your communities, your friends. Many others of you will have to
work longer hours in factories, or
mines, or mills. Think of this not
as
longer hours,
but
as
more

you

all

home

the

defense

the

for

and

more ships,
things that are

tanks,

needed

Will Pay More

your

of life.-

way

your

Taxes

All of us will have to pay more
taxes

without

and

things, we

Think of this, not as a sac¬

like.

rifice, but as an opportunity, an
opportunity to defend the best
kind of life that men have ever
devised on this earth.
As

to you tonight, ag¬

speak

gression' has

military ad¬
should not
explain away that

won

vantage in Korea. We
to hide or

fact.

By the same token, we should
renewed courage and faith

draw

the

from

world
the

Korea

the

of the free
aggression. What
have done
in

response

that

nations

free

right, and

world

know

men

all over,

is right.

that

Communism

Whatever
there may

temporary

setbacks

be, the right will pre¬

vail in the end.

should win.
Because

interfering with the movement of

try

•

forget just

close to us, as important to us,

the

control,

freedom

Our

possi¬

Budget to reduce the

forward,

keep clearly in mind the meaning
of what we are doing.

''pay-as-you-go" basis.

rector of the

plans for making

our

country stronger.

our

defense

cannot

escape paying the cost of
military program. The more
pay by taxes now, the better

slow

have

mended
gress

this moment

strike that has partially

action

This
to

planes,

Defense Administrator.
In

ber of steps. We have put

tions

civil

re¬

the

greater

The government is
forward

good

the

paralyzed our railroad system.

take this

Down

individual

ber of its members are out

con¬

Defense

the

at some

will

chiselers

unlawful

ances

The

lowed to get by.

Making Preparations for Civilian

likely either to

must be used much

speed-up

tion.

primary defense against
inflation, because they strike at

up or

allow.

violated, it

how to work to increase produc¬

several ways

of reducing the amount of consumer funds
go into consumer markets and force prices
be hoarded and released to produce the same results

will

standards

these

than

If these standards are

this time of danger, each of

Unfortunately,

not

posed. I ask every one concerned
not to set prices and wages higher

what

same

where
im¬

cases
are

bilization.

subfrom

in those
controls

wages

our

railway union and a large num¬

for

higher production goals. Business
men will have to put their know-

ble

a very

the agency will an¬
fair standards for prices

mandatory

son

cost of defense

necessity of taking

by the Economic Stabili¬

nounce

the

very

doubt cut very substantially into
able to the ordinary consumer.

circumstances implies the

an¬

be director of this office. Mr. Wil¬

prepared, for early submission to

Must Take Part of Income

series

In addition,

directed that recommendations be

Now, obviously the avoidance of inflation in these

will

pointing Mr. Charles E. Wilson to

to do for half the remainder of the world would without

the flow of goods avail¬

future,

orders

zation Agency.

high targets,

young

stabilize

the law requires.

In the immediate

con¬

effort to reach them. Workers will
be

undertake

country.

government

the

imposed,

also

wages, as

be willing to make an all-out

and

price

of many other things.

must set

alumi¬

must

goods available to the ordinary con¬

cannot build up

steel,
But

done

factories and in our
be done by every

wherever we are, and
jobs may be.

us,

must

trol

stronger

must

sponsibility for

production

defense
living.

In
us

pro¬

mandatory

need

and

In those fields where

and

And this brings me to our

important

and the cost of

zation if that becomes necessary.

Consumer Income

moment

are

training and production facilities will
so
as
to make possible a very
expansion

the

whatever our

ducts. These will be mainly items

working toward these immediate
goals in man power and equip¬
ment, we will also expand our

rapid

materials

number

must
our

homes.

government

once

event, some $35 to $40 billion would

job of building

farms, in

is starting at
impose price controls upon

The

necessary.

Furthermore,

work

government will do our best. But
outcome depends, as it has

Price and Wage Control

may

work.

be
paid out in cash to cover wages, wear and tear and obso¬
lescence of plant and equipment, depletion of mineral and
other resources, and profits. Now it may or may not be
possible for business to replace capital consumed in this
process of accelerated production. In any full scale, all-out
war it is ordinarily not practicable to do
so — certainly
if we include housing maintenance and construction. It
is doubtful if it can be done, human beings (particularly
politicians) being what they are, in an all-out rearmament
In such

who

the

one

that

whenever

program,

$35 to $40 billion annually for defense.

say,

savings bonds)

•

America

plain, commonsense look at what is

being planned. We naturally are no more able than
any one else to say just what we shall be spending at
any given time in the future, but to be concrete let us
assume certain figures which should in any event prove
within the right order of magnitude.
At any rate they
will quite well serve the purpose here in hand. Let us say
that 12 or 18 months hence we shall be spending at the

by the iron rule of dic¬

Those

Tinman Announces Defense Plans
forces

our

way,

Program

now

not

and

democratic

the

re¬

are

tatorship.

defenses

Washingto/i

town. But
building

home

your

always depended, on the spirit and
energy of our people.

An Intensified Production

take

The

prevent it.
Let

defense effort that
undertaking, things may
always go as smoothly as we

member that

page

values of
we
all

that

would wish, either in

in hand depends almost wholly upon the terms
and conditions under which they are sold.
Bonds sold at artificially low yields with virtual prom¬
ise of conversion into cash on demand (even where the

from

life,
in.

are

not

purpose

Continued

In this great
we

being planned for this country

during the next two or three years, whether or not we
actually are engaged in a large scale, "all-out" war, these
same conditions are very likely to arise in one degree or
another. Whether they are to result in severe inflation
will

have

trying to find more revenue from the already soaked
corporations. The other practical method of mopping up
these surplus funds is through the sale of government
bonds to them, but whether or not this accomplishes the

promise is not formal as is the case with
definitely not an avoidance of inflation.

American

our

talking more about taxing consumers and less about

were

See It
We

out of love for the great

heartening if the President and his advisers

would

first page

.Thursday, December 21, 1950

freedom is in dan¬

Because

all

these

things

with you,
I
will issue a proclamation to¬
Let our
divided. Our great strength is the morrow morning declaring that a
loyalty and fellowship of a free national emergency exists. This
people. We pull together when we will call upon every citizen to put
aside his personal interests for the
are in trouble, and we do it by our
BfiArl
nf
^nnntrv
All
nf
own
choice, not out of fear, but
ger

united in its defense.
aggressor think we are

are

have been talking about

mir

Volume 172

Number 4970

The Commercial and Financial Chronicle

(2463)
energies

must

tasks ahead of

us.

No nation has

devoted
had

ever

the

Continued

from

page

to this decrease, both construction and commercial service failures
increased, rising to 18 and 19, respectively. These two lines also

greater

had

responsibility than

ours has at this
moment. We must remember that
we

the

are

world.

leaders

the

with
the

other free
and

men

nations and

with

who

love

women

freedom everywhere.
We must remember that

is not
the

world

our

stands

name

justice

based

and

goal

our

but peace. Throughout

war

international
law

the

order.

and

for

principles of

must

keep

that way. We are
willing to nego¬
tiate differences, but we will not
yield to aggression. Appeasement
of evil is not the road to peace.

The

American

people

always met danger with
and determination. I

will

God's

have

courage

confident

that

now,

and,

shall

keep

help,

poration.

Broadway,
New
Nevil Ford was ap¬

Senior

the

announced

title

Vice-President

dent and

discontinuance

executive

the

for February by as much as 60%.
If the petroleum
industry is allowed even a substantial part of the 11.9 million tons
of steel
they are asking, plate consumers will be hit even harder.
In

order

fill

the

plate

requirements

such

producers who fabricate part of their
output would have to make more of their plate available to the
program, or fabricate more of it into products needed for the

regions except the Mountain and Pacific States reported a
decrease in failures during the week.
An increase appeared in the
the New

was

gram, this trade

authority states.

Defense orders which had been

increase by leaps and

The national

bounds

slowly

after the first of

soon

expected

are

the

year.

few conversion deals during the past week
trend; rather, it reflects some hesitation on
buyers.
For every deal cancelled there are

companies eager to sign up for this high-priced steel.
Major
converters are booked full as far as
they care to be.
The few conversion cancellations
noted so far resulted from
two things: (1) Government orders
restricting use of other stra¬
tegic metals is causing some firms to slow up on steel conversion

deals.
to

(2)

Some

consumers

over-extended

themselves

by trying

make conversion

arrangements with anyone who would listen
Cancellations are still the exceptions.
The pattern

them.

among consumers is
if

source—even

to take all the steel they can

get from

they believe they will have to cut back

opera¬

Almost lost in the shuffle of defense mobilization is the

new

ing production

record

the

steel

industry.

The

final

amaz¬

figures

will show the steel
net

industry will have produced about 96.9 million
ingots and steel for castings.
When converted into

tons

The

American

Iron

and

Steel

Institute

announced

this

week

that the operating rate of steel
companies having

94% of the steelmaking capacity for the entire industry will be 100.8% of capacity
for the week
beginning Dec. 18, 1950, compared to an average of
101.3% a week ago, or a decline of a half point.
This
steel

week's

ingots

and

1,953,800 tons
the
a

rate

operating

castings

week

rate

for

ago.

is equivalent
the

entire

A month

ago,

1,944,200
on

compared

industry,
based

tons

capacity,
tons;

new

102.7% and production amounted to 1,980,800
it stood at 94.5% and 1,742,100 tons.

was

year ago,

Electric Output Soars to New All-Time
High Record
The

amount

light and
mated

of electrical energy distributed
by the electric
industry for the week ended Dec. 16 was esti¬
6,985,421,000 kwh., according to the Edison Electric

While

the

decline

along with

from

last

year

The current figure
year ago, or a

compares

rise of 17.9%.

index

The

represents the sum total of the price per pound
use and its chief function is to show the
general trend of food prices at the wholesale level.
foods in general

Wholesale Commodity Price Index Near All-Time High

Registered

January 16, 1948

Continuing its upward movement, the daily wholesale com¬
modity price index, compiled by Dun & Bradstreet, Inc., rose
to 307.47 on Dec. 9, only
slightly below the all-time high of 308.82
registered on Jan. 16, 1948.
The index closed at 307.19 on Dec. 12,
against 302.79

Grain

week ago and 246.75

markets

last

week

sharp advances in wheat.

again

a year ago.

trended

upward, paced

Interest in the bread cereal broadened

considerably, stimulated by good mill demand, substantial sales
of wheat for export, increasing buying of flour for both domestic
and foreign account, and reports of crop deterioration as a result
of dry weather in parts of the West and Southwest.
Domestic
demand for

corn

good and buying for shipment abroad

was

heavy.
After

two

early weakness, prices

some

rose

the

best levels

aided

by a lack of hedging pressure and
small after-harvest movement to terminal markets.
years,

continued

Cash oats prices were up slightly at the close.
Trading was
less active with demand only moderate and available
supplies still

tight.

finished steel products this will amount to about 71.7 million net
tons, concludes "The Iron Age."

1949.

Sept. 21, 1948, when it stood at $-3.82.
with $5.74 on the corresponding date

any

tions.

The Dun & Bradstreet wholesale food price index for Dec. 12
remained unchanged at last week's level of $6.77, the highest since

contracts, thus by-passing the time-consuming policy
letting contracts on the basis of bids.
Procurement agencies

This area,

Wholesale Food Price Index Holds Unchanged in Week

emergency declaration makes it possible to negotiate

negotiate quickly and directly with logical suppliers with
red tape, this trade paper discloses.

49.

sharp in the East North Central and South Atlantic States.

government

now

slight in most of the other regions, it was relatively

very

of 31

picking

rose

England, West North Central and Mountain States, had

casualties than

pro¬

in the similar week of last year.

All

program
many mills now producing sheet and strip would have to switch
to plate production.
This, of course, would cause deeper cutbacks
in sheet and
strip.
Plate

vice-presi¬

creation of the

wholesalers failed

many

of the corporation. The board also

the

allotments

has not established
the part of certain

100

City,

pointed

previously predicted, plate quotas are being hit hardest
Several companies are
already planning to curtail plate

all.

'f less

directors of The First Boston Cor¬
York

can

board

expected to be reduced about

are

more failures than a
year ago, whereas all other industry and
trade groups evinced a decline from 1949.
Only one-half as many

Pacific States where failures

our

Corp.

meeting of the

Industry

50%.

with

Sr. V.-P.

of First Boston
a

these vital products

Cancellation of

Nevil Ford

quotas

freedom.

The State of Trade and

free

must

understand that
we cannot achieve
peace by our¬
selves, but only by cooperating

Sales

of grain futures on the Chicago Board of Trade
243,366,000 bushels last week, or a daily average of about
40,500,000 bushels, the latter comparing with 44,700,000 bushels
totaled

the

preceding week, and 39,000,000 in the corresponding week

year ago.

Prices

domestic

cotton markets

irregular last week
with uncertainty over controls resulting in considerable liquida¬
tion

times.

The

market

closed

were

somewhat

firmer

note,

aiaed by scattered mill buying and a reduction of 65,000 bales in
the Department of Agriculture's semi-final estimate of the season
which placed the 1950 cotton crop as of Dec. 1, at 9,884,000 bales.
Trading was only moderately active and sales in the ten spot
markets totaled only 179,600 bales last week, the smallest volume
in over three months, and
comparing with 247,000 bales a week
previous, and 373,800 in the corresponding week a year ago. Trad¬
ing in textile markets was slower although some sales for third

quarter 1951 delivery were reported.

power

Trade Volume Spurred

by Yule-Time Season

Institute.
The

Electric

output in the above week attained
high record for the industry.
It

historical

new

proximity of Yule-time was reflected in a moderate rise
in consumer spending, during the period ended on Wednesday of
last week,

76,790,000 kwh. higher than the figure reported for the
previous week, <188,815,000 kwh., or 16.5% above the total output
for the week ended Dec. 17, 1949, and
1,195,230,000 kwh. in excess
of the output reported for the corresponding
period two years ago.
was

as shoppers bought slightly more than in the compar¬
period last year, according to Dun & Bradstreet, Inc., in its

able

current

curbs and

The

some

upward price adjustments, was instrumental in keeping
unchanged from a year ago in some localities.

total sales

Carloadings Continue Upward

over-all

Loadings of revenue freight for the week ended Dec. 9, 1950,
totaled 766,743 cars, according to the Association of American
Railroads, representing an increase of 26,821 cars, or 3.6% above
Dunca.i

R. Linsley

H. Potter, Jr.

Win,

buying of such

the preceding week.
week's

vice-president.

14.6%

above

York, and
William H. Potter, Boston, former

16,170

cars, or

senior

)uncan R. Linsley, New

xecutive

orporation,
have .been
enior vice-presidents.
Mr. Ford

nittee

is also

First

The

director and

in 1921,
nd has been serving as a viceiresident since 1925.
He is a past
'resident of
the Bond Club of
York

and

Association of
nc:-

During

^ord

was

treasury

National

the

Securities Dealers,

World

War

II, Mr.

of the

Chairman

for

War

Department's

Committee

lance

Senior

former

/"ice-Chairman

New

Fi-

York.

Center,

currently Chairman of the

'enter's building

fund.

He is also

lirector and Chairman of the FiCommittee of the

ince

for

the

Aid*

Associa-

Crippled

hildren in New York. Last week
i

tr.
:

Ford
the

was

elected

Philharmonic

97,918

2.1%

cars,

decrease of

director

Symphony

aciety of New York.

durables

for

last

Output Lifted Higher in Latest Week

house-furnishings and
past week, as credit

offset

said.

losses by

Chevrolet

38,000

were

Chrysler due to model changeovers, Ward's
scheduled

was

passenger

Cadillac

cars

six

also working

turn

working

overtime, the

out

days,

volume

record

while

agency

Pontiac

and

added.

Total

output for the current week was made up of 130,976
30,776 trucks built in the United States and a total of
5,353 cars and 2,125 trucks built in Canada.
For

the United

automobiles,

week

estimated-

was

period ended

States

alone, total output was 161,752 units,
against last week's revised total of 154,731 units, and in the like

the

appliances, and tele¬

large

from

Wednesday
to
4%

unchanged

Regional estimates varied from the levels of
by the following percentages:

year ago.

-f-6; East, Northwest, South¬

west, and Pacific Coast 0 to +4; and South —1 to +3.
Wholesale

buying

slightly in the week,

rose

holiday fill-ins became increasingly prominent.
volume of ordering

sponding week
the

number

was

reorders for

The total dollar

moderately above the level for the
There

ago.

year

buyers

although the number

was

attending

was

corre¬

appreciable decline in

various

wholesale

centers,

virtually unchanged from the similar

1949 week.

Department store sales

and

cars

the

generally restrictive effect

New England and Midwest +2 to

Gains by Chevrolet and other General Motors divisions
than

items

slightly

very

Total retail dollar volume in the

above

below the comparable period of 1948.

increased

restrictions continued to have

according to "Ward's Automotive Reports,"
totaled 169,230 units, compared with the previous week's total of
162,757 (revised) units and 86,229 units a year ago.

the

Federal

Reserve

countrywide basis,

on a

index

Board's

for

the

taken from

ended

week

1950, advanced 2% from the like period of last year.
pared with

decrease of 1% for the previous week.

of last year 79,692.
Canadian output in the week totaled
7,478 units compared with 8,026 units a week ago and 6,534 units

weeks

one

corresponding period

Dec.

This

com¬

For the four

week

year ago.

tered

Business Failures Decline
Commercial
week

ended

Dec.

failures

from

170

declined

150

level

for

Failures

of prewar

were

last year,

44%

the

but remained above the

1948

total

below the 270 in the comparable week

1939.

Casualties, large and small,

were

lower in the week.

Manufacturing and trade failures accounted for the week's
While the decline was relatively slight in manufactur¬
ing and wholesaling, retail casualties dropped 21 to 65.
Contrary
decrease.

Dec.

1950,
a

sales showed

year

ago

rise of

and for the

year

from the

to date regis¬

advance of 5%.
record

new

was

established in dollar volume in retail trade

the

preceding week, Dun &
Inc., discloses.
Casualties continued below the .1949
the eighth consecutive week; they were down from 161

in the similar week

ended

industrial

and

Bradstreet,

of 96.
)n

increase

corresponding week in 1949, but

( trustee of the New York Uniersity-Bellevue. Medical

Combined motor vehicle production in the United States and

Cor-

Boston

ipration which he joined

lew

represented

Canada the past week,

the executive com-

member

the

total

other

year ago

Auto

the
named
of

vice-presidents

demand

consumer

vision sets.

The

itle

of retail trade.
An appreciable decline in the
durable goods items, under stress of credit

summary

purchasing of

New

York

last

week

sales

advanced

about

10% above the

like period of 1949.

According to the Federal Reserve Board's index, department
store

sales

New

York City,

for. the weekly period to Dec. 9,

1950, advanced 2% from the like period of last
ceding week
ilar

week

change

was

increase of 2%

1949.

noted

For

the

was

four

from that of

year.

In the pre¬

also registered from the sim¬

weeks
year

ended

ago,

Dec.

and for the

1950, no
year

date, volume advanced 1% from the like period of last year.

(2464)

from

page

to
As

the

vital
crude

products, let us examine
feasibility of Communist ag¬

the

It is doubt¬
that many are familiar with
geography of the Middle East.

in that

source

might discourage a direct invasion
from the north, but it is entirely

the

approximately 1.8 mil¬
lion
B/D of crude produced in
the Middle East, runs to stills in
this

region

B/D' in
'that

amounted
It

June.

possible that some move might be
through Baku, on the Cas¬

made

870,000
unlikely

seems

the Western Hemisphere, and

dependent

East than the
would

incredible

for

area

nearly

petroleum needs is

that

there

diplomatic

our

leaders.
has led

this

condition

amount

being

This

B/D.
Thus

far,

have

been

em¬

down

the

ern

fact

production to only 368 sticks

that if the Middle East is lost, the
other
sources
of
supply would

been

has

munist

place

merely

are

outside

23%

the

oil

Communist) controlled

areas.

cult to envisage

that

23%

the
I

allowance

any

series of similar

relatively small

increase

this
make

too diffi¬

riots

with

the sole purpose of destroying the

remem-

not

the in¬

seem

Communist-inspired

increase is out of the question.

bered

It does not

ances.

would

arti¬

newspaper

pointing to a multitude
Communist-instigated disturb¬

Furthermore, it should be

numerous

have

side pages,

and

supply strongly suggests that such
an

There

area.

cles, albeit well hidden

sources

of those other

survey

East

this

been

production

Middle

increasing evidence that
infiltration is taking

Communist

maintain recent rates of consump¬
tion. This would call for an in¬
crease

nomic

for risihg consumption.

number of wells

area.

quate

all

not

that

sure

precautionary

TABLE

World

Crude Oil

ade¬

diplomatic

be remembered that Russia's aims

25,909

______

Canada
/V

Production, June 1950
(000 B/D)

% of Total

5,378

51.6%

33.3%

1,200

Other

1.5

853

1.2

194

1.9

America__

27,962

North

36.0%

Significance of the Loss of Middle

9,500
1,048

12.2%

10.548

13.5%

Other South America-___

Total

South

America__

Hemisphere

264

the

the loss of the 368 wells
And it has
been

area.

tinct

17.5%

71.5%

7,478

7,000

Kuwait

9.0% (

11,000

Iraq

14.2

Saudi

Arabia_________-i_

9,000

Other

10.0%

135

11.6

;

563

163

1,040

(

6.7

5,250-

1.3
5.4
'

Russians would

the

have catastrophic consequences on
efforts to block the

our

spread of

Communism.
In

$139,666,000

compared with $110,965,000 in the
like 1949 period, an increase of
25.9%.
*

Airlines,

Mid-Continent

nations, thodjnited
face
three al.erna-

reported
a
$296,545,
equal

cents per

Inc.,

first

1950

income

net

the

for

City,

share on the out¬
shares of com¬
compared with net

415,943

standing

stock,

mon

profit of $307,788, or 77 cents per
share, on 399,253 shares outstand¬

period

ing at the end of the same

the

control

summary,

must

totaled

sales

1950

last

The net income for the
1950 was $52,-

year.

of October,

month

as against $44,536 for the cor¬
responding period in 1949.

721,

tives:

loss

dis¬

the

world

total

pro¬

would have lost 1.8
19%. This would
available
production

million B/D, or

the

lower

(excluding Russia and her allies)
from 9.6 million B/D to 7.8 mil¬
lion

would

current levels, it
rjecessary for each of

ether

raise

order to

and

B/D,

production

(again
excluding Russia) to increase its
production by 23%.
Let

producing areas

look

again

An increase of 23%

would

in the United

the

mean

addition

1.2 million B/D, or

than

at Table

of 6.6 million B/D,
compared to the current 5.4 mil¬
lion B/D.
However, at a recent

declared

supply from its domestic re¬
much

required

possibility of such a feat, within
the next
year
or
so,
has been
demonstrated.

This means,

19%.

a drastic
military arm

consumption face

that

but

cut,

nonhave to

that not only would ci¬

in effect,
vilian

the

would

world

lowered

our

would also be forced to curtail its

consumption—at the risk of great¬

limiting its mobility.

Europe

nation

ern

without

this

petroleum

the

sure

were

supply

A mod¬

allies.

restriction

exist

cannot

simply

country

would

States

United

The

(3)

lose all

products.
unable to
Western

oil, these allies would
necessary
to slip out of

ropean

U. S.

sphere of influence and

The

Russian.

the

allies in

ioss

If
in¬
Eu¬
find
the
into

these

third World War could

catastrophic.
All

These

the

are

made

alternatives

most
must
be

are -

unpleasant,
considered.

choices

the

that

must

East

Middle

which

stock' transfer and

tains

Nov. 14 had

offices in St. Louis, on

negotiations under way with re¬
gards to increasing its outstanding
first mortgage sinking fund 3%%
bonds from $9,500,000 to $16,000,000 in order to provide adidtional
capital. The stockholders on Jan,
will

vote

the

increase

upon

proposal to

authorized

common

1,500,000 to
2,000,000 shares in order to pro¬
vide "substantial funds for capital
additions and
working capital"
stock

$1)

(par

"to

and

from

provide for conversion of

100,000 shares of unissued and un¬
reserved
4V2% cumulative ; con¬
vertible

stock.",

preferred

Net
nine

earnings after taxes for the
months

Sept.
30,
1950,
$2,860,495, equal to

ended

amounted

$2.28 per common share after pre¬
stock dividends. This com¬

ferred

with a net of $3,238,938 for
corresponding period of last

pares

the

which was equal to $2.60 per

year,

share, adjusted to present common
shares outstanding after

deduction

paid during the first

preferred
states that
sales for the

nine months of 1950 on

stock. The corporation
the company's

calendar

gross

exceed
in
- •!,

will

1950

year

$100,000,000 for the first time
its history.

Conclusion
obvious

The

conclusion

the vital petroleum

that

New York Stock Exchange

supply center

'Weekly Firm Changes

in the Middle East must be held.

consumption." bOther estimates of Additional defense assistance must
amount

main¬
registrar

Clinton Foods Inc., which

of dividends

three

the

presented
but
they

the

meet

present level&:of U. S. consump¬
tion without a# undesirable drain
its resources*! br

Consumption

(2)

Communist
be

the. lost.

than

oil

•

in order to meet current

by 23%

demand, or at least 30% to meet
a 6% increase in demand. The im¬

undertaken.

area

current

duction,

the

(1) The entire democratic world
would have to increase production

possibility unless further de¬

fense

such

that

shown

the

Iran

sup¬

ply picture, let us for a moment

amount-

2.5

1,834

4.9.5%

38,510

the

of
Middle East in the world oil
importance

extreme

Total Western

further

In order to demonstrate

the

sources

15.0%

1,570

1.3.

hands

the

control

Such

Supply

Eastern Petroleum

now

Venezuela

desired.

Auto

020,000 in November, 1949, an in¬
crease of 9.2%. For the 11 months

months

pressure

Western

during November amounted to
$12,036,000 compared with $11,-

could be ex¬
erted on any of the countries in
the Eastern Hemisphere whenever
Frightful

she

oversubscribed.

was

Kansas

political

own

Smith,

Co.

advantage.

her

States

"it is doubtful that the U. S. could

54-. 2%

5,644

oil, it would then be
possible for her to dictate the
distribution of this vital material

Communist

of the State Department,

Total

cf the

control

gains

jor source of petroleum.

of the American Petro¬
leum Institute, Edwin G> Moline,
Chief of the Petroleum Policy Staff

Russia

Middle East

Middle East oil is lost by the non-

meeting

America___

North

important.

eliminating Western Europe's ma¬

production

Production

1/1/fiO Proved Reserves
(000,000 bbls.) % of Total

very

are

most

might well be satisfied by simply

Reserves and

recog¬

measures

States
•

not

eco¬

fearful that
and
defense
may not
be taken—as
witnessed
by the fact that only
recently Iraq severed a long-term
treaty with Great Britain. It must
nized,

measures

been taken to insure thecon-

ave

decade ago.
this shift is

Sales

Co.;

Co.; and Stix & Co. The

Western Europe has
increasingly
dependent

years,

recognition

source

its

since

And,

importance

proper

months, there

Brothers

Stern

dependence. Within the last

Hemisphere oil only

Corp.

Cook & Co.; Reinholdt & Gardner;

Middle East oil, in contrast
with jis dependence upon Western

point at issue is the

underslood.

4.50%

stock

preferred

at par ($100 per share), plus ac¬
sig-, crued dividends, were the follow¬
oil ing Missouri bankers: Newhard,

upon

presume

dynamite is obvious!
In the last several

have to be built up by 1.8 million
barrels per day if the non-Com¬
countries

average

East

very

become

be taken.
a

few

some

B/'D.
The
vulnerability of this Middle East¬

the Middle East for three-

boils

with

ing

quarters of its oil, but. the whole

problem

well of 5,000

per

compares

The major

420,000 wells in the U. S. produc¬

phasizing the dependence of Eu¬
rope on

368, giving aver¬

to only

production

age

overlooked.
v

in the entire area would

of wells

1o believe that the vital

nature

these

Our research in this field
us

successful

the

military

and

time, there
Assuming
completion of all
wells, the total number
that

wells drilling.

were

the Middle East is
were,
at the end of

operation.

fact that de¬

fact

known

1949, only 327 producing wells in

%ths of its

high place in the planning

serves a

least

and

pertaining to

rate, that Europe is de¬

pendent upon this highly vulner¬
able

the most

Probably

feared.

figures in Table II

indicate.

At any

infiltration

the Middle

upon

political

Middle

the

scarcely be over-emphasized.

can

supply for the free nations.
This is the fact of the situation
that seems to be so woefully mis-

subversive tactics
are
perhaps more

international

The

nificance

The

importance of this oil as

the enemy, and

fore, indicates that Europe is even
more

to hold this
source of supply for the non-Com¬
munist
nations,
more
extensive
order

either of these po¬
tential
operations
might
entail
considerable supply difficulties for

only other'ma jor world market is
Europe. The latest evidence, there¬

met.

of this petroleum.

use

publicly
of

Texas Eastern Transmission

offering

Communist

demand

obviously this increased
(470,000 B/D) cannot be

nomic

However,

Dec.

convertible

wells, which would there¬
by eliminate, at least for a year,

precautions must

However,

the

200,000

necessarily lean heavily upon eco¬

preparations could

that

ran.

refined products finds its way into

who

offered

crude oil,

pos¬

pian Sea, or perhaps an amphib¬
ious operation leading
to Tehe¬

these

amount

great

any

Iran

found in the northern part of

area.

writers

source

made for the effective destruction

The

its

of these

of totai

terrain

if the

by 7%.

increase

Moore &

sible

page

Included in the group of under¬

ful

entirely

seem

from

Missouri Brevities

do¬

oil

crude

for

considerable extent, in¬
ternational political alliances must

nearly 90% is estimated to come
from the Middle East, with 72%

mountainous

offi¬
thinking more in

are

It would

use.

rather

company

will

1951

that

estimated

has

demand

Middle East is lost

the Russians
from obtaining this oil than they
are
of preserving it for our own

gression in this area.
the

mestic

There

Continued

Mines

of preventing

terms

imports of crude oil into Europe,

petioleum imports finding

tion.

se¬

government

and

alike

cials

that

evidence

some

executives

and

oil

estimated

B/D

thousand

711

Middle

very

matic and military leaders.

Eastern

determined

Having
nature

fully understood by our diplo¬

Lifeblood of Ewope
rioting the serious dependence of
Europe upon the Middle East. O£

fact,

the rate of consump¬
However, the U. S. Bureau

change

allies.

riously doubt that the vital eco¬
nomic importance of the situation

Middle East Oil-The
ports in metric tons, is valuable in

matter

mili'ary demands for oil and

petroleum

European

Western

our

this

supply

tinued

Continued

Exchange

The New York Stock

crude

be granted to the countries in this has announced the following firm
be
increased area.
Friendly diplomatic rela¬ changes:
have been many and varied, rang¬
tions must be pressed.
However,
Andre de Saint-Phalle, general
ing from Mr. Moline's statement
before
these
objectives can be partner in Andre de Saint-rPhalle
that production could not be in¬
achieved ; government
1 officials & Co.j will become a limited part¬
creased at all, to others citing po-_
and
business
leaders. must
be ner on Janrl.-\r
/ j
tential improvements of 1 million
made- aware
of the full signif¬
William M_ Thomas will retire
B/D. Even if we take the highest

could

production

Total

Middle

East____

32,413

41.7%

1,798

17.3%

821

7.9%

East situa¬ from partnership in Kalb,: Voorthis article, it his & Co. on Dec. 31. ; .• *. /:/•
is my fervent hope that it will
Ursula Squier, Reimer will with¬
still be short by 200,000 B/D of
find its way into the hands of the draw from limited partnership in
making up our share of the def¬
political and military leaders who Charles King & Co. on Dec. 31. .
icit. Other counties where proraare
responsible for the. countiy's
"Robert C. Rooke will retire from

of these estimates—an increase of

USSR and ' Satellites.
Other

•4,920

;

1,557

Asia

Western

6.3% ;.

2.0

245

110

202

.3.1

2.4

Europe

Africa

________

r_____:___

million

tioning

Total

East.

Hemisphere

39,202.

50.5%

2,952

28.5%

B/D—the

has

Source:

77,712

Oil and

Gas

100.0%

10,430

100.0%

Journal, and U. S. Bureau of Mines.

TABLE II

Crude

-««•-.

—Refined Products—

(WMMMM»Tons)*-J

Latin America
Middle 'East- ''

0.1

_______

(000,000 Tons)*

•

4.2

11.8

31.2

88.2

■■

(000,000 Tons)*

effect

Consequently,

even

increase

assuming a

crude

oil

pio-.

35.5

metric

Source:

100.0%

Press

the

Middle

safety and welfare.

Reynolds ft Co. to
Admit Baker, White
Reynolds & Co., 120 Broadway,
New

York

City, members of

New

York

Stock

duction of 1 million B/D, it should

46.6

13 9

24 7

dle East will mean that consump-' admit John D. Baker,

44.3

40.4

71.8

tion

.,9.2

3.5

be realized that

must

cut

loss of the Mid¬

back

over

the

20.8

100.0%

56.3

100.0%

about

9%.

This/would

mean

-;t
i

)

G. White to partnership on Jan.
Mr. White is Manager of

the firms

in n Merrill
Fenner & Beane

partnership

Pierce,

Dec. 31.

bership

the

late, Walter

will

considered

the

change on Dec. 28.

way,

the

39* ©road¬

New York City, members of
New

York

Stock

Exchange,

Street. :

partnership on,Jan. 2. *

Ex¬

Jacques Coe Admits
Jacques Coe & Co.,

will admit Florence Coe to

Crandell to Bernard E. Smith, Jr.,

Chicago office, 208 South La Salle
-

Transfer of the Exchange mem¬

Jr. and John

ra¬

tioning in the U. S. Furthermore,
we are assuming here no increased

Service.

the

will

Exchange,

,9.7

2.0

limited

Lynch,

9.1

tons.

Petroleum

In pieparing

1.9

world by at least 800,000 B/D, or
Total

icance

tion.

it is extremely

23%.

total

Total Imports

unlikely—we would venture to
say
impossible—that production
could be - immediately improved
by

Estimated Source of Western European Petroleum Imports, 1950-51

would

would certainly be in a far more'
serious state, and

Total World

been

not.

limited

f /■*'

Volume

Number 4970

172

The Commercial and Financial Chronicle

(2465)

Continued

page

experience and upon basic human

'•

but

psychology.

from first

goods

Prosperity
Almost

Synthetic Prosperity
and make the citizen the slave and

the

pawn

slave

man

and

the

who

men

state.

pawn

are

Through

the

drenched

millions

extinguish

the

know

their fellow

upon

blood

first

thing

find

out

kind

faced

the

would

want
what

what

me,

the

doctor,

him

was

to
the

was

causing

the illness, and remove the cause,
A little aspirin to lower the tem-

once

hordes

would

matter wLh

free-

Now

men.

were

cailed

effort

basic role, man-

same

and

the

flame

entirely.
I
really ill—
feel the same way

and I think you

dom and impose their selfish wiils

again in the

situation

that if

their

both* taken together

even

the

cover

the

battlefields

with

men

tions or

cen-

Hitlers

the

world

the

and

Mussolinis,

think that either of those assump-

control

turies,
the
Charlemagnes,
the
Napoleons,
Bismarcks,
have

will

the

charge of our government ap¬
parently decided that the fun¬

war,

perature and even
to induce sleep I

Russia and her conquered satellite

nations, harnessed and chained to

little sedative
might be glad

side.
But if I
doctor either didn't
wasn't treating the cause

have on
thought the
to

the

the chariot of Stalin and his ruth-

know

less gang.

of the illness and was merely put-

It is

lory

such

ahead.

nation

our

world that

time in

lites,

have been

plunged into

war

bloody

thousands of

miles

from

boys

are

many

shores;

our

dying

and

our

the

frozen

mountain passes of Korea.

and

wrote

supply

slow

their

One of

Well, our dollar

func¬

economists

for

government-made, synthetic form
of

prosperity—really

based

upon

plied

government-sup¬
of purchasing power

excess

and

government-created

supply

commodities.

ey, and lots of it.

mon¬

The government

produce wealth—it

wealth.

sumes

Such

The

only

which it takes from its citizens in
the form of taxes, either direct or

embarked

the

upon

money

from

something and pil¬

the

form

parity

doles,

subsidies,

payments,

price
support
and other such devices

programs,

people who would imme¬

among

diately
that

around

spend

this

it,

the

was

theory

way

create

didn't

come

just since the Korean

China

war;

and,

therefore,

expensive, the government
paid the farmer not to plant crops

de-

United
have

just

operation, and

the

world.

being physically

enslaved

locusts

This

The

is much

immediate

Now, I have

and

economists.

than, the

have

than

token

assistance

of our allies.

any
to

nation

our

spend

received

books.

the

treasury and
the blood of our boys to
world

from

the

save

ag-

the

are

lies with

Sion

and

The deci-

do not know.

how

the Kremlin.

be and must

Furthermore, I-do
economics

mathematics,

many

which

individual

even

psychology play

mass

yye

few mad Russians

are

ments

opening rounds of the Third World
War

determine

should

inflation
should

was

this

part.

brought about,

candidly, l'ac-

engaged, and pos- tually, and realistically because it
shall be en- is logical to assume that if. we
gaged, in a great military, indus- could and would remove its causes,
trial, and spiritual mobilization to then we could arrest its progress
prevent the ruthless hordes of if not entirely eliminate its effects.
Russia

some

years

satellites

her

and

from

most sacred.

will

people hold

Truly, Christian civhumanity
are
at

and

ilization

Our

stake.

all

and

success

depend

our

basically

strength of

our

productive

capacity

our

trial

prj-

system.

that

js, but also our economic,

enable

forced

upon

win

if such

us.-We

can

first disintegrate

rate from within.

our

internal economic strength

military

productive effort is
us

take

of the features of

some

omy..

We hear

look

our

*•

econ-

great deal about in-

the

over

and,

the

extent

not

sure

that

this

mand> then the price goes up. The
h^her prices -.create .an- -.indueer
ment

founded—let

our

that

commodity.

produce

until

excess

supply

the

equal to

demand

pro-

.duced—then the price goes down;
and, .it

being

less

profitable,

is produced. There are some hard-,

hat

never

was

something

existed until the Ko-

was

for people
to get along in this world was to
get more and more for doing less

the

by
to

government.

everything

war,

done

of post¬
deliberately

feed

the

way

has

fires

which
tion
In

whole

our

its

na¬

early stages,

stimulating

success

built.

was

inflation is
alcoholic bev¬

increased by

greatly
II.

With

ian

diverted

and

controls

World War

production*'of

goods

effort

course,

with

the

price

and

rationing,

and

civil¬
war

wage

tremen¬

nomic controls of this kind do not

artificial and unreal prosperity.

its

contract

redeem

tions in gold—it

blow

verted

the

end

of the

war,

the

approximately

supply

our

many

this

had

quantity of the commodity

ships
is

the

based

readjustments,
upon

actual

but

But the leaders of organ¬

mized.

We hear

inflation

great deal these days

the

contribution

made

by credit policies.

It is

govern¬

forces of inflation.
inflation.

In saying this,

greatest

; Although labor is the
element in the cost of

products,

the

government,

with almost childish innocence, if
it was innocence, announced that

human it would raise the

wages

of labor

high taxes bringing in tre¬

ment,

the

revenues

govern¬

continued to live beyond
means, allowed our tremen¬

our

flexible

rate

which

remain

outstanding,

sought ways and means to
dole out billions of dollars to mil¬
lions

people.

the

same

would attract the purchase of gov¬
ernment debt outside of the bank¬

time, with

ing system would have helped and

military strength and equipment

would

help to minimize the

now

over

forces of inflation.
I

mendous

lot

which

the

Treasury has been faced with in
the

management

the

tremen¬

dous government debt.
*It

also

saving

cents

per

the public debt mate¬

rially contributes to inflation and
higher prices of commodities and

which is
as

consumer as

wage-earner.

We
of

large

cannot

well

the

government credit

effect

policies

the

integrity of the dollar without
commenting on the lending activi¬
ties

the

Then,

when

the
of

words

have

for

the

words.

meant.

His

tionary factor

based upon credit
picture has been the

tremendous

housing boom devised
promoted by the Federal Gov¬

terms.

They
will, in a large percentage of the
service

been

veterans-

dis¬

them¬

It helped to boost the cost

both

which

the

selves.
of

to have

the

labor

and

materials

resulted * in

into the houses, and
prices all out of line

with sound

values and predicated

went

credit terms under govern¬
guaranties which no sound

credit

would

man

countenancing.

have

thought
Billions
of

because of its unsoundness.

gram

National Mortgage Association.
do

not

want

ignore the

bank

participation in this program; but
certainly the overwhelming re¬

upon *,

In
there

the

upon

and
lies

the

the
was

consumer

also

of credit in

ticipated.

credit

field,

rapid expansion

which the banks par¬

The rapid expansion in

man

hell

said:

"Yes, 1
it,

fix

Grave Dangers Ahead

of the facts leading to our
pres¬
ent economic situation not because
I

want

all

work

indulge

needless

time when

together

must

this

great

emergency for the preservation of
our

country and the free peoples

of the world.

face from

and

colored

I have tried to summarize some-

buying

prove

in."

now

cases,

use

discus- '

As I understand

the

means

great

and

friend

thinks I does.

governmental agencies in making,

and

economic

who heard the phrase used asked
his friend if he knew
what it

amount

this

came,

quo."

"status quo" because I
understanaable definition

cause

government

their

our

sions these days which some of us
have a hard time to define. I use

and

Korea

"status

criticism at

speak

allowed

the words

quite obvious that if

fractions

interest

horizon,

our

was

problems

not

clouds hanging low

war

disappear and to rust out.

In say ing this,
unmindful of the tre¬

economy

pressures.

which

and

government and
its
agencies and other lenders, and
not upon the banks.

and the gov¬
yielded to their political

developed

activity

mistakenly called prosperity.

With

mendous

dous debt

policy to aid in
servicing has been a

its effects

wait

business

low-cost debt

ernment

which

spree

ment easy-money

for wage increases,

want

not

Spree

citizens to go on a reckless
spend¬

was

program

did

result

frenzied
Credit Policies and Inflation

sponsibility for this

labor

Spending
As

ing

sold the mortgages to the Federal

free economy again.
been done, the con¬

Government-Encouraged

aided, abetted, and encouraged its*

with the

hazards incident thereto.

about

con¬

and

turn

Regulation W terms.

government-

currency

into

Others went along for the ride and

loose

nies, large retailers, other lenders,
some banks, largely adhered

all
these and
other factors in the
postwar years,
the
government
went
on- -and

equalled the demand, it could then

most

the

part
again,

in the face of competition on more
terms by finance compa¬

its obliga¬

dollars of

when

however, many banks refused to
along on the terms which they
were
basically unsound, and

to the old

definitely struck
stability of the

managed currency

upon

now

There

When this government went off
the gold standard and repudiated

ment

with

are

house.

new

and

filment.

misleading glow of

tributed to the

cure

inflation.
They merely hide
by artificially damming up the
demand and postponing its ful¬

liberal

in the whole

!was,'~ of

chines, and all of the multitude of
appliances which

projects, all con¬
inflation, but shone

welfare

government itself, with its con¬
tinued peacetime budget deficits,
based in a large measure on bank

inflation

was
in
turn
greatly
by the housing boom.

All these new houses had to be
furnished and equipped with elec¬
tric
refrigerators, washing ma¬

social

guaranteeing loans.
Possibly the single greatest infla¬

The

field

felt

but after overindulgence,
just as destructive and brings
about as great a headache.
The
erages,

it is

this

stimulated

Price-support programs,
extravagant government spending,

services, then the government it¬
self, which is by far the largest
and
less.
This
was
of
goods
and
man-made, single purchaser
synthetic, artificially inseminated services, may in fact be saving
inflation, manufacture*} to order pennies and paying out dollars in
and found for some years to be higher prices.*
The same thought
politically quite profitable.
Of might well be considered by labor,

ized

iow to remedy it.
think that it

there

that the

in¬

production.
created
the

Under

lesser

host

Thereby

cost

tinuing round of price increases
free enterprise system, this is might have been avoided or mini¬

done

.in

incentive

and
of

rlation in the last few months and

One might al-

been

flood

was

government bonds were
price and wage controls
Now, of course, in a free
damming up the demand for civil¬ bought by Federal agencies to
economy the law of supply and
mortgage
lenders
with
ian goods, the government was provide
demand
acts
as
an
automatic
in a position to hold both controls added funds to feed the flames of
'if
r,t
sa^ety valve. If the supply of any steady until civilian goods produc¬ this inflationary fire. Many banks
commodity is less than the de- tion could get under way; and refused to participate in this pro¬

our

money

qUate.

it is, for it

important—and

the

doctrine

goods
and
services
to be purchased.
The

services;

is the very foundation upon which

brought

simple explanation is entirely ade-

never

Some Features of Our Economy

which
of

excess

Creased.

a war

and deterio■
"

things

^at the price is raised, the purchasing power of the dollar is de-

be destroyed from without unless
we

for labor and thus

pay

some

Inflation has been defineu

avaiiable

an(j

global war, and only such streng h
is

therefore

bidding by the excess money for
dous and abnormal shortages in
ple short supply of goods or servcivilian
goods developed.
Eco¬
}ces raises the price of the goods

financial, industrial, and spiritual
strength on the home front. Chdy
such strength can prevent another
cart

examine

supply * of
•

The future of this
country and its very salvation depend upon our strength
pot alone
bur military strength,
necessary
as

the

about.

the

vately owned and operated indus-

Let

measure.

the

and

the

failure

upon

economy

mo*

creased

That

credit, planned, created, and fos¬ ernment. In this program, leaning
Inflation was brought about in
tered inflation; and then, pointing on the political crutch of hous¬
^his country as a matter of deto the false, unsound, and syn¬ ing for veterans, terms of credit
liberate government policy over
thetic prosperity created thereby? were established, backed by guar¬
a period
of almost 20 years, with boasted that "We
planned it that anties of the government, which
world War II thrown in for good
were
way."
•«
n.
outrageously
unsound
in
......

dominating mankind and destroymg us and all that
other freedom-loving

and

scarce

why and

now

are

sibly for

services

elements, borh
tangible
and
intangible,
which course, it was bound to undermine
the strength of our economy, and
have an effect upon the economy
destroy individual incentive and
of the country,
including many
reward for unusual effort upon
rather unpredictable human ele-

shed

greatest les-

can

that

science

There

by human experience

believe

exact

Communist

Whether

gressor.

from

that

found

of the

the hard way.
not

practical

think

not

Some

learned

alone

and

purchasing
power."
hand, to make goods

expansion and to kill his little pigs, and then,
the Korean both directly and indirectly,
pressed
for shorter
hours
and

for

and

in economics

sons

It has been left
almost

economics

all

cases

wasn't

On the other

great respect both

economics

for

physical threat to our own country; yet, strange to say—and I say
this factually and realistically, not
bitterly—v/e

war.

by Communist Russia is
more

about

of bank credit since

threat

overrun

great as, and in most

brought

allies most of the free

our

Korea.

Nations

nations
of

swarming

are

Northern

over

an-

price of

labor.

true, of course, that the
indebtedness

other pawn into the war; and the
ruthless
hordes
of
Communist

been

the

inflation.

indirect; and what it borrows,
usually from its citizens. So the

'•'increased

having

pawns

back

the

value

money

had lost more than 40% of its
purchasing power before the Korean war, so all of our infla.iori

Stalin's

feated, he has apparently sent

Since

con¬

which the government has is that

government

down

inflation

breached

not

does

short

obviously required

program

holding
war

inflation— briefly with

those who had

evidence* of it.

and

prescription

policy of taking tax

Let us be realistic about this
matter. Certainly we have some
inflation—a lot of it. Our eeonomists tell us that high prices are
not inflation—that they are the

aggression of Russia and her satela

tioning;

too

hlness, then I would certainly de- ing up government
and spreading the money
man<^ a change of program,

continued

the

law
was

I wouldn t know or care about my

the

look down the road

Because

damental
demand

linS me to sleep with sedatives so

the his-

and

ago during a
depression, those

years

severe

and that the tightening
few economic thumbscrews
eliminate it.
Well, I don't

rean

mean?1 of

whicn

sta.e,

period of

hold

produced

statement, of course, was both
ridiculous and impossible of ful¬
fillment.
Right then the
dam

Government-Made Synthetic

Planned Inflation and

still

I have

done; so be¬
believe that,

sincerely
the dangers

are

which

Communist

Russia, we
dangers from

also

have
grave
within which threaten the stabil¬

ity

and

the

political

effectiveness

our

life.

economic

and

Int

fact, our ability to meet the
dangers
from
without
depends
upon

ability to build and
strong, sound domestic

our

maintain

economy at
home.
We
choose the road which we

must

take from here on out.

want

build

for

permanent

stability,

get
down
to
funda¬
and lay a firm founda¬

mentals
tion.

We must

and eliminate

clearly

see, know,
weaknesses and

our

mistakes.

I have neither the time

adequate
and

knowledge

probably

not know.
we

our

the

foreign poli¬

mendous

gram

however,

to prepare for

program
and

war

lives

I do-

war.

embarked upon a tre¬

will

Possibly
your

long

We all know,

are

full-scale

will
and

that this pro¬

long

duration.

extend beyond
mine.
We must

to both the size-

gear our economy

the duration of the program.

When

the

nor

the facts

I hope that we are not now

embarked upon
that

the qualifica¬

not

tions to discuss
cies.

and

shall

must

our

was

yard-dash
marks

onds.

couldn't
good

men

was

ont

jumped from their
gave

little over nine
sprinters'

the

all

sec¬

two-mile.

the

ran

use

hundred-

tech¬

I think the analogy holds
in
the
effort
which lies

ahead of

Our

The

with the gun and

they had for

nique.

in college,

team.

track

today.

problem

requisite

manpower

Continued

divert

and
on

the

produc-

page

Chronicle

The Commercial and Financial

(2466)

Thursday, December 21, 1950

...

the

from page 33

stating this as a popular be- Continued
lief and not as my opinion.

Tomorrow's

Currently the market is full
inflation hedgers.
After
Truman's speech the general
belief became widespread

Markets

Private

Whyte

Says —
=

that

everything was going
sky-high and the sooner one
got into common stocks, the

By WALTER WHYTE =

better.

column

week's

Last
written

so, was

evident in the volume

was

In fact

Tuesday.

The fact that this was

during the next few
The tape ran late and
Monday or the
phones were ringing mad¬
Tuesday and you see them
ly in all order rooms, not to
Thursday.
Well, when the mention the calls to cus¬
previous column was written, tomers.
most

these

had

market

the

columns

are

either

written

days.

already

moved up some seven
from the

of sales

low and

points

We've

for

inflation

had

needlessly
dis¬
rupting
our
essential
domestic
economy.
It will call for sac¬
rifice;
it
will
call
for read¬
justments.
Yes, and it will bring
about many inequities and even
These must be mini¬
injustices.
mized or eliminated as they
without

gram

become

thing is

big

the

But

apparent.

must get the job done.

want

part.

and direct

vious

day at 229.27.

What

overlooked,

how¬

ever, is that despite the fre¬
Subsequently the President quent asininity of some of
made his speech and the mar¬ our
"bureaucracies,"
prices
ket, having already antici¬ will not be permitted to shoot
pated it by reacting, turned up forever without more def¬
right around and went up. As inite checks. The market, a
this is being written the aver¬ mirror, of hopes and fears, is
now in the former phase.
I
ages are at 232, or about three
don't think, however, that it
points under the old highs will continue to mirror the

made the end of November.

hopes forever. The fears will
Hf
%
*
also have their inning and
There is considerable be¬ from what I see at present, it
to be
lief that the industrials will is the latter now
,

mirror the action of the rails

watched for.

into

high

new

ground in the near future. I'm

this

Executed

you

I'm

York

Stock

Curb

Exchange

San

Francisco

Stock

COrtlandt 7-4150
Private

San

no more

than

not

coincide

expressed in this
necessarily at any
with those of the

They

presented as
only.]

are

those of the author

Exchange

Chicago Board of
14 Wall Street

time

Chronicle.

Members

New

York

That's something

views

article

Schwabacher & Co.
(Associate)

Trade

Chase Guards

unique Christmas village in

off-hours, is on public dis¬
play this week on the main floor
Per 100 Shares Plus Tax

•

pfd.@48% Feb. 23 $387.50
Chrysler Corp.@ 68
Feb. 8 275.00

Merck Chem..

@54% Feb. 19 762.50
Canadian Pac.@221/8 Mar. 24 225.00
United Aircraft@33% Feb. 19 412.50

mas

tree in

the Chase

guard de¬

partment 22 years ago, the village
has grown each year until this
season

it will occupy an area cov¬

Mar. 17

375.00

ering more than 65 square feet.

@24% Mar. 23
Wheel'g Steel @34
June 21
Y'ngst'n Sheet@ 50% Feb. 23
Schenley Ind. @37% June 9

287.50

The little tree has developed

425.00
287.50

Sinclair Oil.. @32
Publicker

...

Explanatory pamphlet

forect

back¬

ground of snow-clad hills.

It is

Brokers &

Broadway, N. Y. 4, Tel. BO 9-8470

pines, with

525.00

Dealers Assn., Inc.

into

complete with streets, a beautiful

church,
Members Put & Calls

on request

THOMAS, HAAB & BOTTS

controls,
W

Regulations

There is
already

types of credit.

a
better position to do it, and
they have the "know how" based

their splendid

that field

usefulness

Their

performance

during the last warvita"

this

function must not be impaired o

stymied by any premature or un¬
warranted curtailment or
of

ment

their

The

tion.

volume

ability to

bank

func¬

large

that

fact

impair¬
so

will

credit

required to finance the production

officers

The

program.

this

lation X became effective, it will

association have twice in the last

months before the effect

few months reminded the bankers

some

of it will be

edly

fully felt.

Undoubt¬

hardships have been
by these regulations.

many

created

should

These

remedied

extent that it is

the

possible to do

so.

their

ties,

opportunities, their du
their
responsibilities

and

Restraint

self-control

and

qualities which will be found in
the vast majority of the bankers
in this country.

in Bank

Trends

Credit

There has been much study and
discussion
on
the recent

much

trends of bank commercial credit.
Most of the increase this year

since the commencement

been

the

Korean

that

sure

ject

has

figures

our

should

war.

that sub¬

realistic before we make
the basis of restrictive ac¬

are

them
tion.

know

all

that

many

corporations and individuals
bought

abnormally
during
the
months following the start of the
war.
They had the natural de¬

Going too far and too fast i
imposition of restrictive con

the

trols

tend to stagnate th
before the war produc
under way enough; t
take up the slack.
It would b
prudent to observe the trend 'o
may

economy
tion gets

the economy

action

ther action is taken.

goods

materials

and

To the extent that

buying

used credit for that
their future buying will

and

purpose,

level

they did future

their loans will

and

off

well

also

known

peak of commercial bank

sents

and
It

normal

the

will

seasonal

peak

automatically taper off.
also

should

borne

in mind

believe that this is the

hope an
view of

wit

majority of those charged
these responsibilities.

Against Increase in Bank Reserve

with the
needed in

their business and personal lives.

and the effect of th
taken before fur

already

sire to supply themselves

believe

not

crease

reserve

banks

member

that

iin

requirements

It is not

of credit control.

good metho

pre

cision instrument in the hands o
a

all

axe

unskilled

involved

a
a

withou

to or consideratio
policy or the loa
individual

the

mor

It strikes
alike

banks

any reference
of the credit
volume

hands

the

workman.

member

technician.

skilled

hank

the needs of the

com

munlties in which the banks ar

public that,

programs,

pressure of very great emergency
when
It is, in fact, a socialistic ste
This is
which
appropriates the norma
do not wish to argue about spectacularly true in the case of
earnings on billions of dollars b
some agricultural products.
particular one of these things.
taking these earnings away fro'

extension

benefits

veteran

There

are

Each

could be added to this list.

of such curtailments would be un¬

reason.

should

the

the size

public

most

deflationary

direct

both to curtail the
inflationary effect of such expen¬

for

will

the

productive

offsets

This is the

the loan;

which will strike

heart of the problem
war spending.

take

purpose of financing es¬
production, then the in¬
creased
production
more
than

the

and

war

some

time for the

force in

If loans are made

sential

work.

materials

the very

labor

quaint

lighting
and

hall,

town

dwellings,

system,
brook

waterfalls.

with

rows

railroad,

series

and

program

get

under

way

be substantially

damental

felt, and the
should not be stagnated

tion

inflationary

together

deflationary.
loans

effect

and the whole transac¬

taken

Mere

therefore,

is,

is actually
volume
of
not the sole

criterion.

The political aspects

these

in form, a credit control or regu
lation.
It is in substancfe, if no
in

of propert:
Even th
preached tha
the way for government to tak
over private business and privat
property was to take away th
profits from private business an
private property, and then bot
would automatically fall into th
lap of the government.
the

law,

without

things

taking

compensation.

old-line

socialists

bankers

We
cerned

over

greatly

con

inflation

tha

are

the

exists in this country,

and we ar
deeply interested in the preserva
tion of the integrity and purchas
ing power of the American doll

inflation is

to money to enough people.
They We are the custodians of oth
credit were advocating new government- people's money and propert
policies of the government. .The sponsored agencies to get out more That
money is not impersonal',
fact that the Federal budget has
It represen
money in loans to great numbers is human money.
been unbalanced for 18 of the last
the "bloody, sweat and tears"
of people whom the bankers felt
20 years is a major factor in the
millions
of
people.
It is th
were not good credit risks.
Now,
present situation.
Every effort
product of their brain and thei
must be made to pay as we go, suddenly,
some
of these same brawn,
their
thrift
and
the'
cause

be found in the money and

although the size of the military

of expenditures

skating pond
a

war

of the United States. Whpn
governing power takes the earn
ings of a citizen's assets, it ve

ury

Increased production nearly approaches the expropria
is probably the tion of
the property itself.
It i

the economy.

the

putting them ulti

the banks and

mately in the coffers of the Trqas

commodities

provements at all lower levels of
government,

merely

volume of such loans

effect.

ary
of

im¬

than

determines their inflation¬

which

curtailment

channel

was

commercial

the

rather

loans

bank

made

purpose

a r

i 1

should not forget that it is

which

others

many

than

higher

rially

these prices were lower.

physically sound veterans.
any

ures,

of some of
frequently change
quite rapidly.
Only a few short
economy
precipitately while waiting for the months ' ago, many people in
of the bank's head office at 18
military spending to get under Washington were castigating the
Pine Street.
banks because they claimed the
way.
Beginning with a modest Christ¬
As is usually the case, the fun¬ banks were not lending enough

their

•

credit

know,

hqve already been imposed

two

ready, able and willing
to do the job.
They were never
are

located.
Furthermore, it does no
in using comparative fig¬
touch nonbank Tenders.
It is
with higher commodity,
rough-and-ready method whic
ments, public housing, reclama¬ prices and higher labor costs, the
should
be
invoked
only
wit,
of
credit
tion projects, the buying of amount
required
to
great reluctance and under th
mortgages — yes,
and
even
the handle the same volume is mate¬

support

and offset increased

miniature, created by the guards
of the Chase National Bank in

Mo-K-Tex

times.

normal

category would
come,
others, many subsidies,

works, river and harbor improve¬

Barbara

SPECIAL CALL OFFERINGS

this

type of action

Monterey—Oakland—Sacramento
Rosa

desirable
In

effort into

Teletype NY 1-928

Fresno—Santa

and X

banks

postponing and de¬
ferring,
if
not
abandoning, bprrowing is always in the fall,
many
proposed
expenditures and I have no doubt that a sub¬
which many people might consider stantial part of the increase repre¬

and

Display

Wires to Principal Offices

Francisco—Santa

all

field

the

In
as

that the

least

ditures and to

Exchange

New York 5, N. Y.

effectively won.

also

will have to work out. popular with various elements of
our citizens, and they are politi¬
interested in profits.
cally hard to accomplish for that

[The

New

sideration.

Pacific Coast Exchanges

upon

The

economy.

reduced.

domestic

considered advice at
stage of the market cycle

original positions in
are
your favorite
stocks; sell the other half
while you have the profits.
I'm not taking taxes into con¬

Securities

socialized

have

country

in supporting a

program and

experience would
indicate that the fight will not be
its source, past

medicine, Brannan plans, etc., but

price

is to hold

Orders

*#•

half your
whatever

Pacific Coast

social welfare programs,

among
*

and also go up

to offset in

way

increased governmental ex¬
penditures for war purposes is, of
course, to decrease by cutting to
the bone government nonmilitary
expenditures.
I am not talking
now just about attempting to get
more efficiency and less extrava¬
gance and waste in government
operations.
I
am
talking now
about not only stopping cold the
further
expansion
of
so-called
part

this

and a vital job
financing the prepared¬

sound

primarily to efforts to divert or
impede the progress of inflation
rather than toward stopping it at

it volun¬ commitments made before Regu¬

to do

a necessary,

ness

directed

far.

case

helping to

long time, though it's been a the fullest cooperation with the
was indicated.
creeping kind best seen in a agencies charged with the respon¬
*
*
#
sibilities in the various fields. We
long-term graph rather than
have been received in that spirit
The following few days the in
day-to-day developments. in our contacts with these agen¬
reaction signs of the previous
According to popular belief, it cies, and this experience has been
few days were justified by the has now assumed the
dynamic and is most gratifying and heart¬
spill you saw Friday (15). The stage; and perhaps it has. ening.
industrials closed that day at With the
In dealing with these problems,
government in there,
first
things should come
first.
224.70 after making a low of or
saying it will be in there, The war in Korea and the pre¬
223.19.
It is interesting to
ordering huge amounts of de¬ paredness program will call for a
note that on Tuesday, when fense
material, it is possible large increase in government
the
Thursday column was that the explosive inflation, military expenditures. This seri¬
written, the averages ranged most feared, will now occur. ously aggravates an already
serious situation.
The most ob¬
from 228 to 231, closing that
H
' t'fi
H
;

the

been

do this job, the evidence that they are
bankers
both
individually
and taking hold.
It is probably too
collectively in their associations soon to evaluate properly their
want to do and to play their full effect.
Particularly because of
In

tarily and wholeheartedly and in

reaction

pro¬

banking and the credit

banks

big,

Synthetic Prosperity
the military

"Here,

by it are a vital apd
constructive part of our economy.

The

tive effort into

crying,

and

baby."

furnished

Planned Inflation and

Walter

bankers

this is your

possible

may

make this im¬

achievement

banks brought about the

inflation.
this

immediate future.

Those

"inflation

who

fathered

child" cannot

their economy and the'
industry, and their intelligenc
labor,
It

legis- disown

their

own

offspring

largely trying to place it in the arms of

and

the

their

represents

against
now

years;

If the administrative and

lative action taken, as has

the

people infer that too liberal lend¬

ing by

want

represents

education
care

their

of the

protectio
declinin

the

their

suppo
childr

family when the

Volume 172

Number 4970

ill, and
happiness in

are

■<

funds

The Commercial and Financial Chrohivl&Z?*^"

their comfort and
thousand:WaySi5?"
stand

cannot

these

dissipated

and

see

infladeficit fiby

tion, devaluation and
nancing which reduce the purchasing power of the dollar and
thereby confiscate this accumulated capital.
l

We know

•

that you cannot bor-

rOw and spend your way

prosperity.

to sound
borrow and

you

how much can I surpass former
The * other
belief, marks?
philosophy
based upon their observation and says: How little must I produce,
experience, that they can get it if what is the least distance that I
they go after it, and can keep and must travel, how slow can I go,
enjoy it when they get it. They how much can I get for doing how
work for a reward—they work little work, and how inefficient
when they have an incentive. That can I be and still hold my job?
is the American system. It is the The latter philosophy is one of
basic and fundamental reason for stagnation and defeat—the former
our achievements. The other rea- is one of achievement and success.
son why men work is fear^-eitlier The onensays the world (meaning
fear that they would lack some the producers) owes me a living;
of the things they want if they and they had better give it to me

enough to

effort

—

them to "make the

cause

the

rational

spend more than you take in, you
are mortgaging your future* and
if you keep it up long enough, you didn't work, or fear of what a
will become bankrupt.
The same political
master, as in Russia,
is true of a nation.
might physically do to them if they
,

know

heither
late

nations

nor

men

the

simple

mental

not work when they were
vior ordered to do so. Tnis latter labor
that

experience

cam

but very fundaof business
and

facts

did

is slave labor—it has no ambition,
spirit,

imagination,

in-

centive. It is inefficient and is
staggering price in terms of unproductive both mentally ana
human misery.
physically. The American system
As citizens of this country, we is based upon free individualism
must see that sound fiscal policies and freedom of. opportunity.: If
are adopted by our
governments, you want more than you have and

economic

life

without

paying

both local and national.

As bank-

willing

are

the

pay

price

by weight of numbers I'll ap¬
propriate the product, of their

tribute

and

the

part

our

maximum

amount

Then

have.

can

you

old

world

known.

price

knows

has

Continued from page

;

ever

willing to pay the
brain
and
brawn
to

for

unproductive

y°u may keep and enjoy as a
iutthfer-i-Property right for yourself and
your family that which you have

purposes

needlessly lead to-

credit expansion.
L
*
4
Sound Principles Can Prevent
Inflation

your efforts; and
the right to own and enjoy prop-

acquired through
erty

The
for

such

cannot be prevented
merely by the imposition of gov-

the

one

most

principle*

ness

renewals,

mon

ap¬

stock enjoys a good leverage

factor.

With higher

taxes a cer¬
tainty this leverage will prove of
greater;

importance

to.

the

In¬

vestor.

basic

human rights. That kind of life
and opportunity came to be known

the
challenge which we face today,
We have great wealth (as well as
a

dehtV

eroat

Wp* have

ereat

j!nc

nroductive

^capacity

great agricultural

his nSrn Lav
^ve the nght in his own way

Security Analyst,

Bruns, Nordeman & Co.,

can

?*r
We

have

aur

levels.

belts and get to

^ ™"domS and

thp

portunities o£ the

we can

other job.

must

heritage

preserved

^ecause

made

It was

this

any

op!

individual are
as

the

priceless

great

can

century.

forget

But at this time let us not

progress of our
country was made under the lifegiving air of personal freedom and

the

piat

great

individual

opportunity.

Produc-

tivity of the individual is the key
high standard of
Jiving.
This productivity grew

are

now

engaged in

With the recent dividend decla¬

tunitv.

socialistic

was

oppor-

not built under any

system

either

government-owned or

ment-controlled economy.
:

govern.

growth of this
great country from its small; and
modest beginning to its present
stature is a thrilling and unparalleled chapter
in the history of
The story of the

mankind.

ning of
Atlantic

Stiirdy
:

embodies

the

span-

continent from the
to the Pacific, with the
pioneers crossing barren
the

stock¬

lected

holders

not

the

used

necessary and

government will
absolutely

unless

that the powers so

granted will be suspended as soon
as possible.
Now is the time, if

in the history of this nation,
f°r an alert citizenry to stand by
as minute men solemnly resolved
that wartime controls over tne
economy and. the wartime regimentation of the people shall be
ever

terminated at the earliest possible
moment.
' L
.

We must not allow the present

ideals,

the

this

secured

before

standard of living never

equaled or even dreamed

of in the history of
.

Basically, men work both men-

tally
two

both.
to

this old world.

and

physically for one

1951

believe in- American

have

the

instincts,

character, and the hardihood

American

pioneers,

will

get something they want

our

own

taxes

55%

tax

current

compared

rate

45%

with a
is ex¬

pected around $2 per share and
possibly
somewhat better. The
company appears relatively shel¬
tered from the impact of an ex¬
cess profit tax because of its large
for capital investment.

the

country,

time

American

has

come

citizens

stand

and be counted

tinuation of
dicated

current liabilities.

healthy conditions in¬
The

creased

outlook

government

encouraging.

very

contracts

000,000

amount

appear

for

in¬

business
Backlog

of $100,than double the

Production

year ago.

of these orders will run into

some

Federal Telephone is

today
in much better position for large
scale production than it was at
the

outbreak

with

the

bulk

scattered

World
its

War

time

one

manufacturing

Smith Nominated

San Francisco Exch.
FRANCISCO, Calif.—
P.
Gross, Chairman of
the Nominating Committee of the
San Francisco
Stock Exchange,
Richard

has announced

that

Clif¬

to domes¬

manufacturing operations.. is
Capehart-Farnsworth Corp. which
designed and marketed a com¬
pletely new line of television re¬
ceivers and photograph-radio in¬

some

20%

Beanehad
been

cash

i d

e n

about

d i

armed services.

Foreign
ties

are

tional

manufacturing activi¬
conducted by
Interna¬

Standard

Electric

received .from
the

controlled

Corp.

Which controls factories through¬
out

Europe, South America, Aus¬

Chairman

Board

the

Governors.

Nominations
for

members

of the Board

or more

1951,

nomi¬

nated

demand

production of television sets

.Fenner

for its products greatly exceeding

curtailment of

Merrill,

Lynch, Pierce,

tic

current

Ferdi¬

nand C. Smith

ton, N. J.
Of equal importance

SAN

units

concentrated in its plant at

with

31, 1949 stood at $44.79 per
share. At a current price of around
13 the shares are selling 20 points
below their 1945 high and only
5Vz points above the 1949 low.

excess

Book value

Dec.

prospects for 1951

favorable.

International
Telephone
and
Telegraph is in sound financial
and working capital position with
current assets of $182,640,000 on
Dec. 31, 1949, including cash and
government securities of $42,271;000, compared with $66,882,000

Governors

for

Ferdinand C. Smith

two years

terms are:
Calvin

Duncan &
man

Calvin

Co., and Marco F. Hell-

of J. Barth &

Co.

Annual Meeting

The

tion

Duncan

and elec¬
Exchange

officers

of the

held

will be

Wednesday, Jan.

10,1951.

Webster-Chicago Sleek
Offered at $14.25 a Sh.
F.

Eberstadt

Co.

Inc.

and

Shillinglaw, * Bolger & Co. today
(Dec. 21) are offering publicly

China.

International
103,158 shares of common stock
subsidiary of of Webster-Chicago Corp. at $14.25
Radio Corp.
and
Radio per share. Proceeds of the sate
and its Capehart-Farnsworth sub¬ Corp., supplies electronic equip¬ will be added to the company's
ment
to
telephone and power general funds and applied as nec¬
sidiary. The latter was acquired
in May, 1949 and reported earn¬ companies
and acts as United essary to finance a new plant
States export division of the In¬
ings of $l,0d0,000 for the first ten
program, with the balance going
ternational Telephone System. It to
months of 1950.
working capital.
also
furnishes management and
1
The company is a leading man¬
International
Telephone
and
advisory services to some foreign ufacturer
of
automatic
record
Telegraph has gradually changed
manufacturing concerns together changers and magnetic wire rec¬
the scope of its business from an
with
research
and
engineering orders. At the present time most
organization formerly primarily
development results from its lab¬ of the recond changers being man¬
engaged in management of tele¬
oratories.
This
year's earnings ufactured by the company are the
phone
operating properties, lo¬
should benefit from marked im¬
"three-speed-three-size" type
cated
abroad, to manufacturing
provement in operations and re¬
which
are
sold
under its own
activities including those of two
American

Cable

Henry J. Low

tralia

Standard Electric, a
Federal
Telephone

and

large domestic electronic equip¬
producers. One of its major

ment

and

mittances to the

resulting

parent company

transfer¬
and service

from

greater

independent telephone companies

operating tin the Western Hemi¬
sphere, is beginning to show real
earning power after four years of

unprofitable operations. After in¬
a loss of about $1,200,000

curring
for

six

months

ended

June

30,

States

and

Its principal

Andrea

cus¬

Radio

and Corp.. Canadian Marconi Co., Ltd.,
Du Mont (Allen B.) Laboratories,

operating
telephone
radio telephone
and radio telegraph services prin¬
cipally throughout Latin America.
Its modern research and develop¬
United

include

the public and
i o n-phonograph

owns

companies

laboratories

manufacturers.

tomers

and long distance

ment

directly

name

to r a d i o-t e 1 e v i s

Inc., Hoffman Radio Corp., MagCo., Packard-Bell Co., Scott
Radio
Laboratories,
Inc.,
and
Wells-Gardner & Co.

navox

the

The company has recently com¬
menced
production of its new

Europe,

are

magnetic

both

recorder. It also
portable p h o n osilicon steel lamina¬

tape

constantly utilizing scientific tal¬

manufactures

land with another operating profitably since July of
The American spirit this year. The improvement in

ent in their endeavor to assure the

graphs

conflict here

How much can I produce,
how far can I travel, how fast can
says:

improvement
throughout
barring any unforeseen
developments, net income after an
estimated increase in corporate
and

1950, Federal Telephone has been

which has been in

of philosoohy.

combination of
The first reason they work is

reasons

We must revitalize in ourseiVes the American pioneer spirit
great.

per

ings

manhood

plains, parched deserts, and tow- emergency to become the occasion w h o 11 y-o w n e d manufacturing ability of dividends
fees.
ering snow-clad mountains with for losing our American heritage subsidiaries,
Federal
Telephone
i dogged
International
determination and un- of a free political and economic and Radio Corp., producer of tele¬
Telephone
bounded courage. It tells of the life.
We must not lose at home
phone and radio equipment for Telegraph Corporation also
inventive ingenuity of the Amer- the very freedoms which we are
Jean people who, because of their fighting.to preserve abroad,
ambition, their initiative, their in^e must rededicate ourselves to
dustry, and their thrift, developed the
fundamental
policies
and
a productive capacity and thereby
practices which made America

months

45 cents per share reported in the

this subject is being

this cutback should be
will resume more than made up by expected
dividend
dis¬ equipment orders for the U. S.
bursement
in Signal Corps. During World Wai
January, 1951 II, Farnsworth established a repu¬
after a lapse of tation of being a very good low
19 years.
The cost producer. It has excellent
company
is engineering
facilities
available
passing on to and is presently carrying on re¬
its long neg¬ search and development for the

our economy, to enthe government to make
quick decisions and take quick
action.
The liberty-loving, selfgoverning citizens of this country
are for patriotic reasons suffering

granted

called.

the

for

powers over

the representation that the powers

of
and

system

incentive

of
on

phone and Telegraph Corporation

abie

private

Ameriean

$1.34

and. radio receivers is anticipated

to the President large emergency

and flowered and bore fruit under

initiative,

roll

country

in the

their already heavy burdens to be
increased.
They are doing so on

the

ration of 15 cents per share and
in stock, International Tele¬

keep us

their liberties to be restricted and

nine

by
my
pioneer
fore¬ same period last year. 1950 earn¬
fathers; and by all that is holy, I ings are estimated between $1.75
propose
to pass that birthright- and $2 per share compared with>
down to
1949 net income of only 72 cents
my sons.
Here
in
American
today on per share and $1.07 per share in
Based on continued earn¬
many fronts and in many ways 1948.

are

to the American

for

30, 1950 amounted to
share, compared with

production. The subsidiary's turn¬
over
is currently running at an
annual rate of $50,000,000. While

Telegraph Corp.
•'«

great
We

income

Net

ended Sept;

courage

struments

Members, New York Stock Exchange

great
war j^bii^tion program, which
was
the
in the, wjjj involve
huge military expenwinning of two world wars m this ditures
The congress is granting
productive

our

LOW

International Telephone and

things

same

nation

things that

which

these

what made this nation great. They

work,

capacity
deciding factor

lick this

achieve his ambition is the'funda-

mental reason for our success.

people who have
productive
'know how' at
he
management, research and sk 1ed
workmen

of hls own talents and abilities to

cap-

technique?,
u

IIENRY J.

have

production

with' improved

able

and will be maintained.

icy

'This country has within it all
the elements necessary to meet

sac¬

rifice and handed down with great

1952.

portunities in this great country

birthright, achieved at great

Security I tike Best

franchise

Recently the common stock was
split two for one.
Assuming a
continuance of the present annual
dividend rate of $1.25, the yield is
ernment credit and other controls, as the American way of life.
It
The job can be done only if all has opened new frontiers,both geo- in excess of 6%.
Earnings for
eiements of our economy —the graphically and scientifically. It ,1950 were $1.81 per share, so that
government, labor, business, and dug the gold out of the California the payout was 69%. Presuming
the
population" at large—settle mountains, and it broke the virgin a corporation tax rate of 50%, it
down to and live by sound bush- sod of the prairie states. The op- is estimated present dividend pol¬

'jInflation

part of

there is one step further that our proved.
With 56% of the capital repre¬
American system goes. If you seing essential production and at the cure property or capital as the sented by long-term \debt, and
same
time refrain from making result of your legitimate efforts, 17% by preferred stock, the com¬
which

says I am a defend those ideals whenever they
American; I am vibrant are put in jeopardy, whenever the
with life and ambition; I live in time,
wherever the place, and
the land of the greatest individual whatever
the
manner.
At
this
freedom and opportunity that this critical hour in the history of our

the national defense program.and
the domestic economy by financ-

loans

life is

free-born

what

The right to live

success.

this kind of

The other

energy.

brain apd brawn and thrift and
intelligence and industry, there is
no limit to what you can produce

will

achieve

conducting the business of banking in this country that we con-

ers,

(2467)

Federal's

earnings

presently

badly I go, how well can I do my job, gaining momentum and with

con-

and

for incorooration into elec¬

company

tions

the

trical and

a
leading position in
telephone
communications

equipment, electronics, radio and
television

fields.

electronic devices. The

presently has two plants
located in Chicago.
company

The Commercial and Financial Chronicle

(2468)

The following statistical

Indications of Current

latest week
week

Business Activity

month ended

Latest

Equivalent to—
ingots and castings

Crude

stills —daily

runs

Dec.

(bbls.)

average

(tbls.)
——-r—
Dec.
Kerosene output (bbls.)
————
,
Dec.
Gas, oil, and distillate fuel oil output (bbls.)
Dec.
Residual fuel oil output (bbls.
Dec.
Stocks at refineries, at bulk terminals, in transit and in pipe linesFinished and unfinished gasoline (bbls.) at
Dee.

Gasoline output

(bbls.)

Kerosene

-Dec.

at——^

Residual fuel oil (bbls.)

94.5

102.7

1,953,800

1,742,100

5.825,220

5,910,700

4,979,300

9
9
9

6,034,000

6,018,000

5,234,000
18,219,000

7,037,000

at———

Dec.

—

19,188,000

19,917,000

2,171,000

•2,581,000

19,466,000
2,220,000

8,297,000

8,613,000

8,466,000

8,611,COO

8,521,000

8,636,000

7,853,000

9
9

109,647,000

109,509,000

105,465.000

106,146,000

25,047,000

•26,491,000

29,003,000

23,397,000

Dec.
Dec.

(number of cars)——

'Revenue freight received from connections (number of cars)
CIVIL ENGINEERING CONSTRUCTION

—

either for the

of that date:

tons)—Month

IRON

for

tons)—Month

and

steel

stainless

59,449

63,006

49,742

9,692

10,516

53,597

8,007,028

*8,740,095

4,223,129

6,503,531

6,145,354

935,037

INSTITUTE:

castings produced

products,

(net

—

end of Sept.

Nov.-

including

alloy

Month of Oct

tons)

80,964,000

84,891,000

86,721,000

45,221,000

45,140,000

64,476,000

Month

October:

Number

ASSOCIATION-

motor carriers

286

—

*286

*4,345,830

3,523,795

$31,300

(tons)

*286

4,515,214

reporting—

Volume of freight transporter

$30,300

$28,900

85,926,000

43,307,000

AMERICAN TRUCKING

Ago

U. S.

Sept.—-

STEEL

ingots and steel

(net

Shipments of

(short tens)

AND

Year

Month "

MINES):

2,068,000

BUSINESS

766,743

739,922

839,612

668,825

674,981

9
9

595,261

703,746

590,997

$119,434,000

millions

DEPT.

INVENTORIES,

MERCE NEW SERIES

ASSOCIATION OF AMERICAN RAILROADS:

freight loaded

short

(in

Stock of aluminum

"Revenue

(BUREAU

Production of primary aluminum in the

1,980,800

are as

Latest

5,755,170

Dec, 9

oil, and distillate fuel oil (bbls.) at—

Gas,

of quotations,

cases

are

Month

(5,869,000

————-—-——?

or,

ALUMINUM

Steel

(bbls. of 42

average

.—

—

that date,

AMERICAN

AMERICAN PETROLEUM INSTITUTE:
Crude oil and condensate output —daily

gallons each)

1,944,200

——Dec. 24

—

production and other figures for the

cover

Ago

101.3

Thursday, December 21, 1950

Dates shown in first column

Year

Ago

100.8

(net tons)

Steel

Month

Week

Dec. 24

capacity)———

steel operations (percent of

Indicated

Week

STEEL INSTITUTE:

AND

AMERICAN IRON

tabulations

month available.

...

COM-

Month of October

■

dollars):

Manufacturing
Wholesale

10,200

9,800

9,100

Retail

17,300

15,900

14,500

$58,800

$56,000

$1,152,200

$212,900

^ $721,100

44.950.000

51,035,000

"45,037,000

3,391,000

*4,313,000

4,657,000

625,700

*630,300

35,400

1,739,400
1,731,400

Total

ENGINEERING NEWS-

;

'J- $52,500

■

RECORD:

Total

construction—

construction

Public
State

and

Federal

•.

.Dec. 14

;

$484,875,000

77,641,000

110,105,000

118,639,000

Dec. 14
-Dec. 14
-Dec. 14

58,869,000

374,770,000

96,310,000

75,379,000
44,055,000

52,587,000

109,488,000

72,963.000

38,860,000

6,282,000

265,282,000

23,345,000

5,195,000

—;

————<—1—

———

municipal—_————

„—————:

$136,510,000

$214,949,000

Dec. 14

—

—...

construction

.Private
'•

—...

CASH

DIVIDENDS

PUBLICLY

—

CORPORATIONS

PARTMENT

September

Dec.

11,420,000

•9,325,000

10,985,000

9,605,000

—Dec.

751,000

847,000

787,000

636,000

-Dec.

134,800

•79,400

153,600

12,600

554

444

342

542

——

Bituminous

of
-i.

—

(BUREAU OF MINES)—Month

of November:

COAL OUTPUT (U. S, BUREAU OF MINES):
Bituminous coal and lignite (tons)———.
Pennsylvania anthracite (tons)

DE¬

Month

—

omitted)

(000's

COAL OUTPUT

REPORTED

—

COMMERCE

„

coal

Pennsylvania

and

lignite

anthracite

(net tons)
tons)

(net

Beehive coke

(tons)———

TEM— 1935-39

—

RESERVE

INDEX—FEDERAL

SALES

STORE

DEPARTMENT

—

AVERAGE—100

COKE

SYS¬
Dec.

—

Beehive

coke

(BUREAU

Production

Beehive

EDISON ELECTRIC

6,985,421

6,728,334

INDUSTRIAL)

AND

—

DUN

170

161

Dec. 14

INC.

STREET

Dec. 12

4.131c

3.837C

$51.94

$49.69

$45.88

$43.08

$40.75

*5,671,223
*587,453

8,000

984,118

*855,133

2,119,800

—

89,910

*90,542

80,598

pounds)

101,410

110,435

92,602

113,715

121,800

117,133

51,805

56,945

139,199

$21,453

$20,949

$16,803

13,329

13,007

7,848

7,613

4,210

4,107

(ret tons)

Month

2,000

Nov.:

A.—

pounds)

2,000

(tons

customers—

S. A.

Refined

3;705c

$52.69

Dec. 12

—

4.131c

Dec. 12

—

Pig iron (per gross ton)—.
Scrap steel (per gross ton;

(tons

Refined

IRON AGE COMPOSITE PRICES:
Finished steel (per lb.)

*6,258,673

630,324

For

—

production

Crude

Deliveries

6,636,594

6,006,270

tons)—

(net

INSTITUTE

Copper

BRAD-

Oct.:

tons)

5,996,606

150

Dec. 16

6,908,631

COPPER

(COMMERCIAL

coke

tons)

(net

Oven coke stocks ut end of month

INSTITUTE:

(in OOo kwh.)_____

Electric output

FAILURES

MINES)—Month

(net

coke

Oven

tons)

(.net

(tons of 2,000 poitnds)

stocks

copper

end

period

$27.25

(tons

pounds!

2,000

——

CONSUMER CREDIT OUTSTANDING—BOARD

GOVERNORS

METAL PRICES

Electrolytic

(E.

& M.

QUOTATIONS):

Domestic

reiinery at———
Export refinery at—
tin (New York) at——

'Lead

(New York)

Lead

(St. Louis)

Zinc

at—

24.200c

18.200c

24.200c

Dec. 13
—

——

24.425c

18.425c

Dec. 13

139.000c

142.000c

151.000c

17.000c

12.000c

.Dec. 13

17.500c

16.800c

.Dec. 13

at—-,-,—

Total

79.000c

Dec. 13

at-———

(East St. Louis)

24.200c

Dec. 13

—

Straits
•

credit

16.800c

17.500c

:
—.

3.638
credit

Loan

Dec. 19

101.32

101.33

115.43

116.02

Dec. 19

119.61

119.82

118.60

118.40

118.80

119.82

Dec. 19

114.85

114.66

115.43

■

5,438

2,876

2,562

7,942

6,904

3,636

3,123

3,342

3,263

2,808

1,045

_—

—

4,461

8,124
3,737

credit

5,394

1,043

973

121.46

——Dec. 19

3,506

9,899

5,481

—

payments loans

Single

104.47

Dec. 19
—

—

credit

Automobile

9.750C

101.66

corporate

'——

30:

Charge accounts

; U. S. Government Bonds—
Aaa

RE¬

short-term

Sept.

credit

consumer

Sale

MOODY'S BOND PRICES DAILY AVERAGES:

;

Instalment credit

Noninstalment

Average

FEDERAL

Estimated

—

millions

11.800c

17.500c

THE

SYSTEM

SERVE

copper—

Service

credit

——

i
,

■

.Aa

;

—

——

Baa

109.24

111.81

"110.88

115.63

115.82

117.20

119.00

120.02

2.40

2.40.

2.37

2.17

2.88

2.85

2.67

2.66

Government

Average corporate

—

2.72

2.73

2.71

2.66

Dee. 19
■

Baa

—

2.92

3.21

3.29

3.08

3.07

3.12

COMMODITY INDEX

—

2.86

2.87

2.86

2.70

505.2

487.1

488.5

125.5

(DEPT.
Month

$13,923

INVENTORIES

COMMERCE)

September

NEW

*15,894

$13,691
15,426

*$29,619
•22,613

SERIES—

dollars):

;

346.9

*$13,725

SALES

(millions of

Inventories:
Durable

108.2

COMMISSION—

at middle
average=100)

(1935-39

122.4

16,470

COMMERCE

Railway Employment

MANUFACTURER'S

2.65

Dec. 19

November

4,376

14,146

(number

cars)

Index

5,501
122,148

$30,393

2.79

Dec. 19

5,791
126,870

(number of cars)

Backlog of orders at end of month

2.88

3.21

3.07

Dec. 19

—

Industrials Group—

MOODY'S

2.91

Dec. 19
Dec. 19

—

Railroad Group
i
Public Utilities Group-

INSTITUTE)—Month

CAR

November:

Deliveries

INTERSTATE

Bonds—;

II—ZIKZZZZIIZIIIIIIIIII—IIIIIIIIIII—;

RAILWAY

2.58

MOODY'S BOND YIELD DAILY AVERAGES:
U. s.

CAN

107.80

111.62

115.82

Dec. 19

—

Public Utilities Group—
Industrials Group

111.81

-Dec. 19

——

Railroad Group

109.24

Dec. 19

Dec, 19

Dec. 19
Dec. 19
Dec. 19

-Dec. 19

(AMERI¬

FREIGHT CAR OUTPUT—DOMESTIC

_.——.—,

Nondurable

21,500

$29,117

17,960

RATIONAL PAPERBOARD ASSOCIATION:
Orders received
,

(tons)-

Dec.

Production (tons)

295.064

199.278

Dec.

243,297

203.493

232,728

233,487

106

101

—Dec.

at.

243.978

—Dec.

—

Percentage of activity—
Unfilled orders (tons)

721,122

722,046

7^9,323

421,332

—

210,286

Month

—;—

Gold

Dec. 15

DEALERS

AND

SPECIALISTS

145.1

J139.2

142.4

Lead

124.9

ACCOUNT OF ODD-

EXCHANGE—SECURITIES EXCHANGE

THE

___Dec.

35,209
1,076,459

~Dec

IZZZZZIZ Dec.

$44,167,628

Odd-lot'purchases by dealers (customers' sales)—

Customers'

other

sales

Dec

...

___

956,170

77,912
221,525

short

t62,729

*76,744♦228,075

1165,982

35,356

♦35,084'

t34,159

3,535,230

tons)
ounces)

*3,61fl;034
*54,572

t2,889,579

$1,360,366
127,265
370.333

$1,351,480
123,341

$813,106

795,755

771,484

89,505,642
118,507,393

88.524,810
118,416,553

54,728

tons)

$29,448,934

Total

149,433

Cash

29,994

28,175

28,973

278

382

247

29,716

27,793

28,726

892,102
10,965
881,137

808,505

819,060

1,050,240
$42,311,304

14,012
794,493

809,959

$34,602,286

$32,513,266

customers—
hand and in banks in U. S
to

of customers'

295,630

286,510

287,700

40"5~,i7O

295,630

2~8~6~,5l6

281,100

free credit balances-

Market value of listed shares—
Member

—

62,546
301.115

361,264

596.116

73,174,833

borrowings on U. S. Govt, issues—

220,168

195,965

132,444,956
115,257

other collateral-——

703,301

687,679

465,070

272

Market value

$27,623,674

405,170

————————II Dec'

of Nov.

carrying

extended

EXCHANGE—As

omitted):

margin accountscustomers' net debit balances——

Credit

of listed bonds--—

Member borrowings on

—

9,101
PRICES

BY FARMERS — INDEX
U. S. DEPT. OF AGRICUL¬

RECEIVED

NUMBER
TURE

Round-lot purchases by dealers—
Number of shares
.2

STOCK

firms

■

12,667

£1'
—

fine

(000's

Member

744; 891

$41,629,903

34,581

hpp

——

Other sales

855,784
$36,194,964

24,869

1,062,907

Dec'
r~n<>r.

Round-lot sales by dealersNumber of shares—Total sales
Short sales

•.

32,430

311

™~II™HHI~Dec.

—_

27,555

34,892

Dec'

II1111111iDec'
.-"III
Dec

Number of shares—Customers' total sales
Customers' short sales
Customers' other sales.
DoUar value

(in

Total

Number of orders—Customers' total sales—
Customers' short sales.

short

(in

YORK

sales_

fine ounces)

(in

Zinc

NEW

•

Number of shares-—Customers' total
Dollar value

recoverable metals in the

STOCK

COMMISSION:

Odd-lot sales by dealers
(customers'purchases)—
Number of orders;

—

short tons)

(in

Silver

LOT

MINF.S)

OIL, PAINT AND DRUG REPORTER PRICE INDEX—1926-36
AVERAGE—100

October:

Mine production of
United States:

Copper

IIOCK TRANSACTIONS FOR THE ODD-LOT

(BUREAU

OUTPUT

METAL

—

August, 1909-JuIy,

1914—100

—

September 15:
Unadjusted—
All farm products—-——

207

247

243

239

212

221

224

194

193

428

399

WHOLESALE

PRICES

NEW

SERIES- -U.

—Dec.

DEPT.

354,780

276,170

358,880

Food

268,420

Feed

grain
grain and hay—.—

Tobacco

LABOR—

1826—100:

——

336

Cotton

217

All

commodities

Livestock

——

—.III—

Dec

Textile

IIIIIIlDec".

products

187.5

183.1

154.4

179.2

175.0

171.6

226.0

225.5

223.0

185.3

Meat

180.5

180.0

176.5

156.2

252.3

163.4

162.6

*166.7

165.4

138.3

134.9

tia/io

134.8

135.4

183.3

180.1

167.2

Dec

221.0

*220.8

217.8

190.0

138.3

136.7

135.2

animals

160

164

183

233

227

298

292

279

372

369

319

248

—

240

251

196

191

236

$904,000

$910,800

$853,000

921,000

857,400

557,102

—

———--

115.5

"runs.

■

200

303

——

products——
Poultry and eggs

130.6

185.1

crops..

Oil-bearing crops
Livestock and products

145.4

167.3

166

250

311

126

Dairy

Truck

161.9

164.2

""~"~""II~"IDec.

includes 446,000 barrels of
foreign crude

151.2

207.9

III___I~I

Building Materials
Chemical and allied products..—

171.0

240.7

Dec

*172.7

245.5

~~r>ec

—-

metal products

Dec

and lighting materials

•Revised figure,

{££• \l

—

...

Metals and

173.4
186.5

-gee

....

All commodities other than farm and foods.

Fuel

—

Meats

™{w

—

Foods

Farm products
Grains

211
393
"

—

•

(Dec. 2 revised

to 477,000

barrels.)

UNITED

STATES EXPORTS AND IMPORTS—
OF CENSUS — Month of Oct.

BUREAU

(000'S

omitted):

Exports

-*Revised.

——

tMonthly average 1949.

Volume 172

Number 4970

The Commercial and
Financial Chronicle

«■

•'

■'•*

«•'

? t>

(2469)

Continued from page 11

Railroad

and valleys in railroad
securities
which leave the railroad
problem

continually with

Problems,

commodities, obviously, because
they escape regulation. There are
no

boats.

general

They

are

they make bulk

coastwise

cargo

bulk carriers, and
rates and

they

I don't know whether
it appeals
to you, but I do think
this ap¬
proach to the thing would

Now,
on

could

trainload

you

much
carry

most

cargo ships, certainly on
two trainloads. We are
competing
with the water carrier. If
we were
allowed to make bulk
agreed rates
it would give us a chance
to com¬
pete with the water carrier.
It
could very easily be

Buffalo.

time put in

one

it, which
For

was

That

was

to protect

hamlet,

the
call

as we

noncompetitive.

instance, let

Ga., which is
as
can

carry

not

us
on

Atlanta,
water, could
say

protected against St. Louis or
perhaps Savannah. So, we can't
charge more for a short haul than
do for a long haul.
But, there again, the trucks can,
ana the water carriers can.
There
again, my solution is simple. Re¬
we

move

the "Fourth" section

ap¬

done, simply ply it to the other means of trans¬
by putting the umbrella off of us
portation.
on to
them.
In any
event, the situation has
Now as to
'gasoline pipelines: so
changed in 63 years that it no
This big carrier
sprung up and longer applies.

bulk .rates.
with

cannot

compete

them.v

As late as Tour months
ago the
ICC said "wercahnot make a
bulk

»rate

gasoline

from

Salt

City to Seattle,:because if
would

you

the

who

man

wants

carload.

pipeline

think

the

ship

one

all

right

for

the

it.

Yet,

you

100-

pipeline

takes

gallon

order?

around

200-million-gallon

There again,

did;

against

No.

are

They
in

take

orders.

position

where we cannot make bulk
rates,
but they can.
I don't
say that they are not ef¬
ficient, but the Union Pacific,
which is regarded as a smart
oper¬

ator, offered to put in a bulk
as cheap as the
pipeline and
ICC turned

them

rate

the

down.

The third
category—the private
carriers is my next point: The socalled commodity clause of Part

which

affects jraJlroads—Section 1
of Part I—the railroads
are pro¬
hibited from being at the same
time

shipper and carrier.

We cannot carry what
I

can't,

down
down

Chairman of

South,
there

New York

„

build

and

ship

barge companies. They are
regulated. They are certainly
competing with the little fellow.
They don't worry about "Fourth"
section.
Those

the

are

them,

see

cerned.

far

noys

you

fighting
sidies
have
once.
man

The

is this:

that

for
not

make.

distillery
whiskey to

the railroad.

an¬

the

battle

paper

are

sub¬

competitors.

the

against

You

heard

mention

that

the street

interested

or
a

big

the

power

subsidy

not.

The

any

voters

only time I ever hear
complain about the

trucks is when they find they can¬
not pass them
along the road or
when

hour to

may
pass

have

taken

half

them.

Now the story about how much

from

hear

taxes, and how

little trucks pay comes
time to time.
And also

about the water

receiving the benefit
spent

the

Ohio

the

same

poli¬

There

and

power

thing

reach

of understand¬

take

the

goal, is some¬
again, in my opinion,

else

that is

intelligence.

The railroad problem has
never
solved. ; Therefore,
I say,
there must be a
space in between
experience and the
intelligence, so
that the two do not mean
the
been

same

thing.

they have,

play this game, and then let the
chips fall where they may."
I say that
because, apparently,

in this
country all you have to do

The Management Factor

Now
ment:

to the effect of
manage¬
not only to man¬

refer

agement's effect on these
prob¬
lems but to the
very direct effect
on the value of
railroad securities.

You can read
good statistical ser¬
vices and look until
you are blue
in the face, and
they will not tell
you anything about the
manage¬
ment.

sults

They will give you the re¬
perfectly and accurately. But

management

fect

any

has more direct ef¬
the price of securities
than
other

one

factor,

opinion.

Now,

I have said mdny times
that no railroad has credit
unless
it is
paying a dividend.
Every
manager in the world can find ant
excuse for not
paying dividends*.
But he hasn't
got credit.

My corollary to that is

rail¬

road has good
management which

hasn't got credit.

;

is to be the

underdog to be elected
office, and certainly in this case

I think

The

are

the

big

senger-train

problem

pas¬

You

derstand that since 1936 the
has required us to

passenger

freight

our

and

our

revenues

the

results

for

end

each

sepa¬

rately.
In

1948, under that bookkeeping
procedure, the passenger business
t—and you understand the
passen¬
ger business includes mail and ex¬

press—had
lion.

deficit

of $559

mil¬
In that year our net income

$699 million.

So, obviously,

under these diversities which
I
have mentioned that I
would
like to remove, the
even

freight busi¬

ness

National Crisis Policies

un¬

ICC

separate

with

Continued from first
page

underdogs.

operation.

makes money.

planes and further large reserves
they can put in action in 90 days.
But

they

can you

do about the

Local

state

commissions

have

charge, generally speaking, of the
abandonments

that

the

railroads

should make.

And 90% of the re¬
quests are turned down.
I think

long as the ICC is our regulat¬
ing body, Congress should give
so

them the power to

by-pass

all

local

overcome

and

state

and

laws

and to decide whether to aban¬
don local operations or not.
What
do the local commissions do when

of $2 billion

you?

They

some

applications

don't

want

table

it.

great

sea

day

go to

they

pieces. But in the meantime
are cannon fodder.

Facing this

menace

They can no more reach Wash¬
ington in force than we can react*
Moscow.

(c)

In this military connection
realize the fact, that the*
Atomic Bomb is a far less domi¬
we

must

nant

than

weapon

was

the East¬

(d) It is obvious that the United
Nations

have

been

defeated

Korea by the aggression
Formosa, the Philippines munist
China. There are
Korea.

and

Aside

which

discuss

with

from
Korea, quate forces in the
later, they have them.
no

tanks,

navy.

world to

land mass on the
the Indies and the Mid¬
dle East of about

Even

600,000,000

peoples.

non-

There

are

sacrifice

American boys to hold

head,
ceed

are

communist

Com¬
ade¬

repel

combat divi¬

practically

Facing this

South

once-

thought to be.

ern front there
are about
100,000,000 non-Communist island
peoples
in
Japan,

air

passenger business?
The ICC has
asked us to do
something about

it.

not

power. Their long
range air power
is limited. These
congeries of over
30 different races
will some

sions

Now, what

are

probably 12 effective

The Passenger Business

they

What

trucks,

events.

ing, and the ability
facts

to water carriers.
Only give
same rules.
We want nine

carriers

River.

and

power

the

men,

when he cannot
pass the truck on
the highway. That is his
only in¬
terest.
He doesn't care whether
he is operating on a

voter

lot

"More

road

truck

more than
telling you
constantly that the roads are built
by the taxpayers and used
by the
trucks.
I think, if we
simply said,

was

Frankly, the only time the
in

much the

railroad

thing that

Most of the ads

see

the

freight is con¬
they are not in¬

me,

surmountable.

problems

money we pay in

we
a

vate

not

Lake

you

.discriminate

You have today all kinds of
pri¬

you

tician

and

developed into a tremendous busi¬
ness.
Why?
Because they made

appeal

York

small town and

are

exempt from regulation.
in

New

the

Now, the

Why Discriminate Against Rails?

Management and Securities

ing of

question about that.

us.

mission

know
the

present

given

moro

bridge¬

shall not

suc¬

time

the

members of the United Nations.

about

150,000,000 non-Communist
peoples in North Africa and Latin
America. Except
Turkey and For¬
mosa,
these
850,000,000
people
have little
military force which
they

would

could

But

spare.

they could contribute vital
nomic and moral
strength.

Facing this

menace

eco¬

the Con¬

tinental European front there

are

about

Our Economic
We

may

Strength

explore the American

situation still further. The
150,000000 American
people are already
economically strained by govern¬
ment expenditures. It must
not
be forgotten that we are
carrying
huge burdens from previous wars*

including obligations to veteran*!
and $260 billion of
bond and cur¬

160,000,000 non-Communist
against
rency issues from those wars.
In
people who, excluding Spain, have
There are
the fiscal year
1952, federal and
less than 20 combat divisions

vote

now

down
in
the
local expenditures are
likely to
more roads, big¬
South that have been tabled for available, few tanks and little air
exceed $90 billion. That is more
or naval force.
and more money is years.
But their will to
There is no way to get
the
than our total
savings. We mustspent on the Mississippi Valley, them out.
defend themselves is feeble
South to New York in their
and
own
Because, if you got
finance huge deficits by further
and more money is
their disunities are manifest.
spent on the them out, you could
trucks and take back other com¬
appeal them
government
issues.
Ohio River, and even for
Inflation
is*
"Oyster in the courts, but there is no
modities.
Of importance in
There is no regulation
way
military weight already moving but we might with
Bay," so that they can use a ship of
of any kind by the ICC.
forcing them to give a decision at this moment there is the British stern measures
avoid the economic
to compete with us.
So, whether and appeals take
In other words—the
Commonwealth of 150,000,000 peo¬
years.
private car¬ we are
disintegration of such a load for
right or wrong, the effects
The second part of the
rier is allowed
to go
passen¬ ple, with probably 30 combat di¬ a very few years. If we
into the of our
continued
efforts for 15 years to try
under
ger deficit is mail.
We asked for visions
transportation
business and
arms,
a
superior long on this road the one center
be¬ to
get the public interested in
100% increase in mail pay and navy, considerable air force and of
come shipper and
resistance in the world will col¬
carrier, and we
eliminating those things is nil. they gave us
are prohibited from
25% and then they a few tanks.
doing that.
lapse in economic disaster.
When I say the public, I mean the
gave us another 25% after
And there are 150,000,000
The commodity clause
that,
people
voters. Every time you hear about
only ap¬
and they may give us another in¬
in the United
The Diplomatic Front
States preparing
plies to Part I. Part I I call the the cost of a certain
airport being crease this
3,500,000 men into a gigantic army,
year. But I think they
We may appraise the
section of the Act which has the too much
diplomatic
they start building an¬ should
air force and navy, with about
give us the whole 100%.
least votes.
30 front. Our great
It does not
hope was in the
apply to other airport.
I have listened to
Now, as you all know, if you equipped combat divisions.
Part II or Part
United Nations.
We
have
wit¬
III, the motor car¬ it time and time again.
I have
ship parcels it is cheaper to ship
nessed the sabotage of its
riers, nor the water carriers, and tried to talk
primary
Some Military Conclusions
against it.
I find
by parcel post than by railway
not the contract carriers or
purpose of preserving peace. It has*
the you are talking against a stone
If
we
express. It is up to the post office
weigh
these
military been, down to last week, a forum
private carriers.
wall. Our appeal up to now has
to raise the rates on
parcel post, forces as they stand today we for continuous smear on our
Now, there again, the resolution little appeal to the voter.
honor,
up to railway express rates.
Or must arrive at certain basic con¬ our ideals and our
is very simple.
purposes.
On the other hand, if
Simply put the
Brooklyn it is up to the railroads to sell clusions.
umbrella of the
It did stiffen
commodity clause plays with eight men and the the
up against raw
(a) We must face the fact that
railway express to the govern¬
ag¬
over
gression last July in Korea. But in
everybody under the trans¬ Giants play with
nine, the voters ment and say here, "Take it, and to
commit
the
sparse
ground its call for
portation business, or take it
that military
away would
remove
Governor Dewey keep it."
action,
forces
of
It is foolish to try to
the
non
Communist America
from us.
There are a lot of rail¬ the next
had to furnish over 90%
day, unless the situation compete with U. S. Government nations into a land war
against of the
roads I know who could build an
was
foreign forces and suffer
corrected.
I believe that if
this Communist land mass would
parcel post. The railway express
industrial empire if
over
90% of their dead and in¬
they were al¬ you take these four points and
business, a private venture, is be a war without victory, a war
lowed to do that.
jured. That effort now comes
present them, with no axe to grind
trying to compete with the gov¬ without a successful political ter¬
The purpose, of
least to a measurable
course, of the against the other
military de¬
man, you will ernment with higher rates.
The minal. Any attempt to make war feat
commodities' clause, was to
pre¬
by the aggression of Com¬
get somewhere. He is a fine man. Postmaster General
admits
the on the Communist mass by land
vent
the
shipping public from All we want is to have the
munist hordes.
same
rates are too low.
As a matter invasion, through the quicksands
exploitation.
But
the
Act
was
rules that he has.
Whether or not the United Na¬
We don't want of fact, I think he
recommended of China, India or Western
passed in 1887. The railroads are to
Europe
put him out of business.
tions is to have a moral defeat
We that they be raised.
is sheer folly. That would
not in that position
be the
now, and they want to
and suffer the
operate Under the same
So much for that. Now we come graveyard of millions of
collapse of its whote
won't be again.
American
rules as the motor
carriers, the to the more touchy subject—man¬ boys and would end in the ex¬ moral stature now depends on
whether it has the courage to—
exempt carriers, the contract car¬ agement.
The "Short and Long Haul"
Frankly, I have tried to haustion of this Gibraltar of West¬
riers and the water carriers.
We give you some of the
."
problems as ern Civilization.
(a) Declare Communist China
Clause
don't want anything else.
I think I see them, with a solution as to
an
Even
were
Western
aggressor.
Another one of our problems is that kind of
Europe
positive approach is their correction, rather than a armed far
(b) Refuse admission of this
beyond any contem¬
the
so-called
"Fourth"
section. necessary.
I don't mean today, or long harangue about
subsidizing plated program, we could never aggressor to its membership.
Part I of the Interstate Commerce tomorrow.
As I said in the begin¬
competition.
I know personally reach Moscow. The Germans failed
(c) Demand that each member
Act applies to railroads, as I have
ning, we have a crisis now that most of the
top executives of all with a magnificent army of 240 of the United Nations cease to
said.
The "Fourth" section
says overcomes all of our little dinky the Class I railroads in
this coun¬ combat divisions and with
furnish or transport supplies of
"we cannot charge less for a haul
power¬
problems such as the ones I have try. As railroad
operators, some ful air and tank forces.
any kind to Communist China that"
longer than the short haul over mentioned. But I would
like, be¬ have developed, and perhaps in
can aid in / their
(b) Equally, we Americans alone
the same route in the same direc¬ fore
-military opera¬
I am too old, to raise
their early time,
my
rightly so, the with sea and air power can so tions.. Such a course honestly car¬
tion."
In other
words, the New voice as I am doing today, to
help theory that experience is inteL control the Atlantic and
ried Out by the non-Communis£
York Central cannot
Pacific
charge more create a permanent solution to the
ligence.
Oceans that there can "be no
nations is not economic sanctionsto carry freight from New
pos¬
York railroad problems so as to
prevent,
Well, I think that Webster de¬ sible
invasion
it
of
the
to Rochester than it does "from if
Western nor1 does
require: military
possible, these tremendous peaks fines experience as the actual-liv-'
Hemisphere by Communist armies.
over

the

private industrial people
ship
their., products
from

But
can

happens?

ger

We get

roads,

■

Continued

page

The Commercial and Financial Chronicle

(2470)

Continued

from

people have braved diffi¬
distressing situations in

Our

page

cult

You

actions. But it would constitute a

(d)

resolution
infamous
lies

For once, pass a

condemning

the

is ap¬

Any course short of this
peasement. *

And

now

tentative

policy for the

alternate

United States. It received

favor¬

the large ma¬

able reception from

Since then the crisis in the world

acute. It is

even more

United Nations are

clear that the

with

fears

are

con¬

disunities.

and

that other non-Communist nations

could not substantially

vacillate

forces.

Continental

clear

Europe has not in the three years
of

aid developed that unity

our

that

purpose,

and

necessary

for its

clear

that

will
power
defense. It

own

friends

British

our

flirting with appeasement of

are

avoid again

And

war.

being

Karl

Marx

highly

World

In both World War I and

War II

(including West Germany)

they placed

have

fog of
whether

debate and indecision on

two

months

proposals of

ago,

propose

now

rant

further aid

our

their

sphere Gibraltar of Western Civil¬
ization.

than

larations.

organized

numbers

would

the

against

Otherwise

And

their shores.

shall

without
doubt, with our
can,

would

That

calamity to Europe

any

of
own
air and naval forces, hold the At¬
measure

lantic and Pacific Oceans with
frontier

Britain

well

cooperate); the other, on Japan,
and the Philippines. We
can
hold open the sea lanes for
our supplies.
Third. To do this
air

teeth.

should

naval

and

arms

our

Pacific

tect
and

outlays

unless

But

right

Formosa
pro¬

can

our

sea

principles

it is

free

ourselves

our ex¬

budget

from

the

dangers of inflation and economic
degeneration.
Fifth. If

toil and sacrifice

President

right
vain and dangerous
and

has

of views and

Honest difference

honest

They

debate

disunity.

not

are

the

are

vital

process

policy making among free men.
A

eign

right, a specific, an open for¬
policy must be formulated

which

gives

confidence

security

own

before

our

can

get

asked,

can

These

would

they

policies I have suggested

are the
rash

avoid

involvement

working

our

cam¬
us

utmost.

They
stronghold of

our

Christian civilization in the world

against

any

With

the

they have already displayed spirit
and

strength

Communism.

defense
have

against

the

stern

duty to work and sacrifice to do it.
Sixth. We should have

none

appeasement. Morally there is no
appeasement of Communism. Ap¬
peasement contains

than Dunkirks. We want

Teherans and

trieve

Yaltas. We

battle but

re¬
re¬

appeasement.
that President

grateful

can

cannot

has denounced such

dangers
no

are

Truman

preserve

lined,

even

policies

ation

Governors

Stock

of Associ¬

Firms

Exchange

winter meeting.

(Dallas, Tex.)

Feb. 8-9, 1951

Board

ation

Governors

Stock

Associ¬

Firms

Exchange

have

hysteria

loss

our

security

out¬

Traders Association

Investment

(Philadelphia, Pa.)

1951

Winter Banquet.

Philadelphia

Dallas

annual

Club

Bond

or our

future. And in

American

security rests the future
security of all mankind.

lines

the

can

(Jasper Park,

Dealers Associa¬

of Canada. Convention
Jasper Park Lodge.

that in time

the

not blind to the

peoples of the world will rise to

Seventh. We

our

are

cultural

ties to it. But the

and religious
prime obligation

of defense of Western Continental

Europe rests

upon

the nations of

Europe. The test is whether they
the spiritual force, the will
and acceptance of
unity among

have

them

byy their

volition.

own

America cannot create their spirit¬
ual

forces;

cannot

buy them

with money.

We can hope

that sometime the

evils of Communism and the dis¬

integration of their racial controls
will bring their own disintegration
will bring their own disintegration.
It

remote

consolation, but
twice
before
in
world
history
Asiatic hordes have swept over a
large part of the world and their
racial

dissentions

empires.

dissolved

their

5 last, in Washington,
Corporation of America
its
all-electronic

telecasting. In the
practically every ob¬

June

15,

outstanding. Most important, the
demonstration proved conclu¬

will

future
difficult to ap¬
praise as some of those clouding
the production outlook. The two
principal ones are regulation "W"
and higher income taxes. Both cut
into

buying

consumer

neither

While

seems

market

power.

hit

have

hard

too

yet,

gainsaying the fact that

in 1951. As you know, a
10% excise tax was levied on TV
for the first time last Nov. 1. The

they

may

had to raise prices

also

following the outbreak of war in
Korea. At Admiral we were grati¬

sales.

companies, of course, are not
in the same degree by

purchasing

consumer

acceptance,
sell¬
provide powerful offsets
brand

High

velopers
to

shadow of a

lic is given such an opportunity to
decide
it will flatly reject the
Columbia
sary

Rube

and

Outing

Dinner at the Manufacturers

Golf and

Country Club, Oreland,

that I think we rank very high

see

in these respects.

is wrapped up in
for an
excess
profits tax. Because of the indus¬
try's tremendous growth in the
last three years it may be very
hard hit if an excess profits tax
becomes law which does not allow

vision producers
Oct. 12, 1951
Dallas

umbus

(Dallas, Tex.)
Club

Bond

the

Col¬

annual

Day outing.
(Hollywood

1951

Investment Bankers Association
Annual

Convention

at the

possibilities

the necessary convert¬
who do not will

able to buy

those

while

ers

Color

picture from color telecasts with¬
out any change whatsoever.
That about covers my views on

the

general

extensive

H. Cassel & Co. Admits
Hugh Cassel will become

months

summarize, I
long-term outlook for

lim¬

ited partner in H. Cassel & Co., 61

Broadway, New York. City,
bers of

mem¬

the New York Stock

Jan.

Vera

limited

from

Ex¬

Cassel

partner¬

ship in the firm on the same date.

dropped

Co., 1 Wall

Street, New York City, members
of the New York Stock

Gale

and Dudley

Blos¬

som.

Dunscombe

York

New

will be formed
offices

York

Rogers

111

City.

Co., members of
Stock

of Jan. 15 with

Broadway,
Partners

Dunscombe,

Exchange

Exchange,

member,

New

will

the
Philip

its
in

Weis-

Dunscombe has been active

Mr.
as

which

certainties
to

probably will
industry a

the

give

in 1951 than the allhad in 1950.
this regard, I suspect that TV

not

poorer

year

time banner year we

However,

alone.

tions in many

industries

an¬

you

alysts who keep abreast of

condi¬

are more

qualified than I to judge that.

Group Offers

Macy Com. Shares
heading

Brothers,

Lehman

decision

tentative

early

final

been

scribed.
The common stock was sold

order

now

enjoined from starting color
while the Federal Dis¬

telecasts
trict

decision.
of

the

Court

Chicago reaches a

Litigants
have

case

will

case

on both sides
publicly stated

carried

the

matter which
way the lower court rules.
Admiral is not a p a r t y in the
Supreme Court,

but

tem
color
ent

tremendously
outcome.

Columbia

sys¬

the
the

the

not

TV.

are

that

believe

limitations

has
as

answer

many

far

system.

accounts

the

several

members

which

Family
certain

are

trusts

the

for

Straus

beneficiaries and for

members

the

Straus

Straus, President
the corporation, is not selling

family.
of

Jack

any

of his individual holdings and

the

corporation

will

not

receive

of the proceeds from the sale.
The purpose of the sellers is to
permit greater diversification of
investments. After the sale, the
any

selling stockholders will pontinue
to own directly an aggregate of

inher¬

88,899 shares of the corporation's
common stock and 19,296 shares of
the

corporation's
$100

ferred stock,

Series

pre¬

par.

addition,

Francis B. Thome

CBS color telecasts cannot be re¬
even

future

development
goes
because
is a mechanical rather than
electronic

group

October.

ceived

blum and Arthur A. Burnett.

individual floor broker.

firm's

immediate

future there are a number of un¬

the in¬

interested

the

the dol¬

underwriters, offered
Tuesday afternoon 117,-392 shares
of common stock of R. H. Macy &
color system. Despite objections
from everybody in the industry Co., Inc. at $32 per share. The
was
quickly oversub¬
except CBS, the Commission made offering

suit

Dunscombe & Co. Forming

sound

lar used to be. For the

and

being con¬
tested in the courts and CBS has

F. E. du Pont to Admit

FCC

September 1 when it
tentatively decided on the CBS
dustry

The

Francis I. du Pont &

bombshell

the

Lehman

public
hearings
deliberation, the

affecting TV

factors

industry.

undoubtedly know that after

You

black and white

continue to get a

growth companies.

fair base for

Holly¬

wood Beach Hotel.

ap¬

then, when an all-elec¬
tronic system is perfected, those
families who want color will be

combine

enigma for most tele¬

Another'

neces¬

Goldberg

pearance,

think

Summer

and the

system

receiving apparatus, which is

almost

the market is

companies. Later,
when I talk about Admiral, you'll

deci¬

final

public. I haven't a
doubt that if the pub¬

the

leave

will

This

ing

individual

electronic system

into color telecasting.

sion

other

the

and

RCA

for

can

will
de¬

the sole color system and

affected
curbs

that

It is my hope, however,

allow

do with this

they will finally decide that the
FCC has erred in establishing CBS
as

just

are

predict

to.

venture

not

what the courts will

(Philadelphia, Pa.)

Philadelphia

tele¬

sively that we can have color

Traders Association

1951

achieved were

results

the

server

good distribution and strong

their dangers.

affecting the demand for TV

power.

millions of other non-Communist

need to preserve Western Civiliza¬
tion on the Continent of Europe

opinion

which

Mary B.

seas.

hope

Dec.

demonstrated

case.

also war created fac¬

are

by the very negligible effect
these additions to prices have had

Exchange,
It would be an uneasy peace but on Jan. 1 will admit the following
we
could carry it on with these to limited partnership in the firm:
polices indefinitely even if the E. Paul du Pont, Jr., Mary W.
Communists
should
attack
our
Pell, Frances de Forest Stewart,

course.

over¬

fied

outing.

for

of confidence

change our opinion.

receivers in the immediate

All

Investment

tion

probably will suf¬

impossible to

industry

(Dallas, Tex.)

Memorial Day

very

come.

there is

21,

Europe,

reason

are

the

winter meeting.

Feb.

will retire

have

without

Americans
or

sell Admiral its color system

day's 10 million receivers without
so much as the turn of a screw.

tors

Tex.)

Feb. 6-7, 1951 (San Antonio,

change,

peradventure.

President of Columbia,

production there are

military

There

opposite. They would

would

give aid to other nations when

Firms

isolationism. Indeed

military forces in hopeless
paigns. They do not relieve

1949 Frank Stanton,
offered to
lock,
stock and barrel for $3,000,000.
We turned that offer down flatly
because we did not then think it
was
the answer to color for TV
and we have seen nothing since to
that in

you

casting which can be received in
excellent black and white on to¬

meeting.

Beach, Fla.)

the

can

winter

Associ¬

Exchange

Stock

ation

Governors

Nov. 25-30,

should now be
opened to these hordes in Asia.
eyes

world. Out of

productivity,

have

temporary losses in efficiency and
in the utilization of capacity which

behind it.

American

way

because of the costs
of conversion. In the changeover
to

(Houston, Tex.)

4, 1951

Board

will

fer next year

Pa.

continue aid to the hungry of
our

Feb.

Meeting of Gov¬

and Election of Officers.

Investment

Conclusions

could, after initial
more
air and navy

equipment, greatly reduce
penditures, balance our
and

unity 'is based

produc¬
high
of business, profits for the

rearmament work and TV

Canada)

urge in all
unity in troubled

times.

for

ties Dealers, Inc.,
ernors

between

that

know

industry very

Association of Securi¬

National

proper

air power.

Fourth.

the

forceful

system of color

While

volume

Jan. 16, 1951

June 11-14, 1951

for

need

island chain

I think the most
to summarize my
views about it, however, is to tell
system.

the Radio

tion

Plaza Hotel.

thing.

Philippines. We

this

There

action

to defend herself.

frontier

Valley Group of
IBA Christmas Party at the Park

confined

deficiencies of the

the

CBS

in TV manufacture.

(St. Louis, Mo.)

21, 1950

Mississippi

Unity

Americans

the

We should stiffen the defenses of
and the

quarter

National

arm

large armies unless we are going
to Europe, or China. We should
give Japan her independence and
aid her in

this

should

period of watchful waiting.

forces

little

have

policy

world

the
a

one

Formosa

Dec.

detail

products and the components em¬
ploying them which are needed

May 30, 1951

Our

(if she wishes

our

Field

Investment

inviting

us.

Second.

steel,
copper,
rubber,
cobalt,
plastics and nickel. Your guess is
as good
as mine as to the avail¬
ability over the next year of these

sure

flood.

land another man

Korea.

another

erect

red

the nec¬

materials to make even
TV sets contain a long
of critical materials, including

list

EVENTS

such

another dollar

con¬

equipped
huge

and

divisions

combat

pacts,

promises and dec¬
Today it must express

however, the very top production
possibility now appears to be 5
million units. It is quite possible,
too, that we will not get

COMING

Board

paper

requirements we could and would
have produced 8 million sets in
1951. Because of the war situation,

that many.

But it must

resources.

own

far

our na¬

for the world this Western Hemi¬

they should

unity to avail themselves of

and

that before

First. The foundation of

tional policies must be to preserve

show they have spiritual strength

dam

certain principles and action.

and

manpower

Television—Its Investment Aspects

essary raw

of those wars. To war¬

one

itself

not to appease.

troubled

for

it with prayer and courage.

productive capacity today than in
either

ferences,

expansion of

truth

whole

the

ourselves

grid

appease

even

times. The truth is ugly. We face

they

organized Communist parties are
a menace we must not ignore.

Communist China. It is clear that

and

in this,

theatre of
has added

fer from battle shock. Their

the United Nations is

realize

in little danger and the hope

are

that

belief

the

than 250 trained
respond to the U.N. call for arms and equipped combat divisions in
the field within sixty days with
to Korea. It is clear the U.N. can¬
not mobilize substantial military strong air and naval forces. They
or

need

They higgle with Germany, al¬
though she is their frontier. They

defeated in Korea. It is also clear

did not

spirit and to

unity. To this date

not fail

shall

have to stand alone. But we

to their confusions. They still suf¬

jority of our press.
has become

their

it has failed. Their minds

fused

to where

come

made to elevate their

have not failed.

fear

without

troubles

our

They exclude Spain, although she
has the will and means to fight.

What Should Our Policies Be?

should go from here.
Two months ago I suggested

search all the history of
there is no parallel

and

page

have

continent. We have

this

faced

to the effort and sacrifice we have

achieve

United States.

about the

can

mankind

great pressure for rectitude.

centuries

three

been

and

from

and

these

National Crisis Policies

Continued

21, 1950

Thursday, December

...

in black and white on

10 million sets now in service

Francis
the

New

Thorne,

York

Stock

member

Exchange,
unless present set owners buy ex¬ ancf senior partner in F. B. Thorne
pensive adapters.
& Co., New York City, died at his
I could go into a great deal of home at the age of 58.

Volume 172

Number 4970

The Commercial and Financial Chronicle

(2471)

Securities Now in Registration
•

Aeolian-Skinner Organ Co.,

Inc., Boston, Mass.

Dec. 11 (letter of notification) 34,099 shares of 4% cumu¬
lative preferred stock to be offered to stockholders
Price—At par ($1 per share).
ceeds—For

working capital.

only.
Pro¬

Underwriter—None.

Office—215 Sidney St., Bos¬

ton, Mass.

Central

Soya Co., Inc., Fort Wayne, Ind.
(letter of notification) 1,600 shares of capital
par). Price—To be offered at market (approx¬
imately $36 per share). Underwriter—Swift, Henke &

Dec.

Co.,

Chicago, 111.

Proceeds—To Harold
selling stockholder.

the

Aeronca

Mfg. Corp., Middletown, Ohio

share for each

$1 unit of notes). Price—$2.12y2 per $1
unit of notes. Underwriter—Greene &
Ladd, Dayton, O.
Proceeds—For working capital. Office—Municipal Air¬
port, Middletown, O.

McMillen,

650,000 shares of common stock (par $1).
including 500,000 shares acquired by Equitable Securities
Corp. from Southern Natural Gas Co., and 150,000 shares

from the

ization.

utility

•

Desert Products,

Dec. 8

er—None.

plan of recapital¬
supplied by amendment. Under¬

300,000 shares of

Price—At par ($1 per share).

Proceeds—To purchase

common

Underwrit¬

machinery and equip¬

ment.

Douglas & Lomason Co., Detroit, Mich.
6 (letter of notification) 6,000 shares of common

stock

(par $2).

Price—$14.25

per

share.

Underwriter—

None.

Proceeds—To Thomas S. Hough, the selling
holder. Office—5836 Lincoln, Detroit 8, Mich.

Dow Chemical

company pursuant to

Price—To

writer—Clement A. Evans & Co., Atlanta, Ga.

ADDITIONS

Inc., Las Vegas, Nev.

(letter of notification)

capital stock.

•

Nov. 24 filed

INDICATES

SINCE PREVIOUS ISSUE

Dec.

Chattanooga Gas Co.

Oct. 2

(letter of notification) $50,000 of 4% convertible
promissory notes and 50,000 shares of common stock
(latter to be reserved for conversion of notes on basis of 1

stock (no

•

Co.

stock¬

(1/3/51)

Nov. 10 filed 200,000 shares of common stock (par $15),
of which a maximum of 125,000 shares will be offered to
stockholders of record Dec. 21, 1950 at rate of 1
share for each 50 shares held, the remaining 75,000 shares
to be offered for subscription by employees
up to 10% of
their annual wages on a payroll deduction plan. Both
common

•

Alabama

Life & Casualty

•

Insurance Co.,

Birmingham, Ala.
Dec.

stock.

(letter of

notification) 10,000 shares of capital
share. Underwriter—None. Pro¬

Price—$20

per

ceeds—For

working capital.
Bldg,. Birmingham, Ala.
Alhambra

Nov.

filed

($1

Gold

Office

718-720

—

Empire

Circle Wire

Mines

Corp.,

Hollywood,

Calif.

per

80,000 shares of

Price—At

stock.

common

share). Underwriter—None. Proceeds—For
further development of mine and for working capital.
par

American Cladmetals Co.,
Oct. 19
stock

(letter of notification) 62,000 shares of common
$1). Price—At market (about $1.12^ per

share). Underwriter—Hemphill, Noyes, Graham, Parsons
& Co., New York.
Proceeds—To Charles R. Anthony,
Chairman of the Board, who is the selling

stockholder.

common stock (par $10),
exchange for common stock of Central
Ohio Power & Light Co. on the basis of 72/100ths of a

share of American

Ohio

common

Gas

share.

stock

common

Cable

Corp.

for

to be made

shares of common stock (par $5).
share. Underwriter—Van Alstyne Noel
Corp., New York. Proceeds—To four selling stockholders.
per

each

Central

enterprises in Israel.

•

Apple Concentrates, Inc., West Concord, Mass.
Dec. 7 (letter of notification) 5,700 shares of common
stock
(par $1).
Price—$10 per share.
Underwriter—
•

Proceeds—For working capital.

Associated

Trust, St. Louis, Mo.
filed 15,000 full-paid $100 units and 35.000 instal¬

Dec. 20
ment

Fund

$100

Associated

units.

Price—At

face

value.

Funds, Inc., St. Louis, Mo.

Underwriter—

Business—Open-

end investment trust.

Atlantic
Nov.

stock.

Oil

stock

Corp., Tulsa, Okla.
gas properties.

and
•

Automatic

Baseball

purchase oil

(par $30). Price—To be filed by amendment. Under¬
writers—Goldman, Sachs & Co., New York, and Fulton,
Reid & Co., Cleveland, O. Proceeds—To retire notes and
for purchase and remodeling of factory building.
Busi¬

Earnshaw-Tharp-Christensen Corp., Reno, Nev.
(letter of notification) not to exceed 100,000 shares
common capital stock.
Price—At par ($1 per
share). Underwriter—None. Proceeds—To purchase sup¬
plies and equipment. Address—P.O. Box 1192, Reno, Nev.

.Colonial

and

•

Dec. 7

of class A

•

Acceptance Corp.

Nov. 20 filed $1,500,000 junior subordinated sinking fund
debentures due Dec. 1, 1958, and 30,000 shares of com¬
mon stock (par
$1), to be offered in units of $500 of de¬
of

stock.
Price—$500 per unit.
Blosser; and Sills, Fairman &
Harris; both of Chicago, 111. Proceeds—To reduce bank

stock
sold

(letter of notification)

300,000 shares of

(par 25 cents), of which 275,000 shares
for

the

account

April 1, 2001. Underwriters—To be determined by com¬
petitive bidding.
Probable bidders: Halsey, Stuart &
Co.

Inc.; The First Boston Corp.; Glore, Forgan & Co.;
Morgan Stanley & Co. Proceeds—Toward cost of $370,000,000 four-year construction program.

Community Finance Corp., N. Y. City
Nov. 15 (letter of notification>-20,000 shares of
stock

common

are

the

company and 25,000 shares
for the account of the underwriter.
Price—$1 per share.

preferred

Underwriter—Mitchell-Hoffman

•

Berry Motors, Inc., Corinth, Miss.
Dec. 12 (letter of notification) 7,500 shares of common
stock (no par).
Price—At the market (approximately
$11.50 to $12.50 per share). Underwriter—Meeks, Red&

Co., Memphis, Tenn. Proceeds—To
Webster, the selling stockholder.
Oct.

stock

(Ala.)

Fire

(letter of notification)

offered

Insurance

common

Howard

common

& Copper Sales Co., St.
Louis, Mo.
(letter of notification) 1,559 shares of common
stock (par $10) to be offered to common stockholders at

$37.50

one

per

share.

working capital.

each

eight

shares held. Price—
Underwriter—None.
Proceeds—For

Office—2817 Laclede Avenue, St. Louis

3, Missouri.
•

Capital Bakers, Inc., Harrisburg, Pa.
Dec. 18 (letter of notification) $300,000 of general deben¬
ture 4% bonds, of which $30,000 are to be issued each
year

to employees.

writer—None.

Price—In units of $50 each.

Proceeds—To

Under¬

retire

outstanding
Office—58 North 13th St., Harrisburg, Pa.
•

Carolina

Dec, 8

Natural Gas Corp.,

(letter, of notification)

debt.

of public

convenience and necessity before FPC.
—Wilder Bldg., Charlotte 1, N. C.
Illinois

13 filed

one

offered

Public

267.600 shares

initially tc

Service
of

common

stock

Office

(par $10)

stockholders

share for each 10 shares held.

rate

Price—To be sup¬

plied bfy amendment. Underwriters—The First Boston
Corp. and Blyth & Co., Inc. Proceeds—For construction
program.

Temporarily postponed.

$1,000,000 of 5-year 3V2%

"to

others."

Continental
Nov. 29

Kansas

Eureka
Nov.

Telephone Co., Corydon, Ind.
(letter of notification) 1,700 shares of

common

—None.

be offered to company's telephone subscribers.
Price—At par ($25 per share). Underwriter—None. Pro¬
ceeds—For cash equity to secure loan allocation by Rural

Electrification

certificates of

Underwriter—None.

Proceeds—

Business—Farmers'

coop¬

association of the/ fed pr¬
of 100.

Engineering Co.,

Carrizozo,

per share).
Underwriter
working capital. Address—P. O.

(50 cents

Proceeds—For

Administration.

Fedders-Quigan Corp.
June 21 filed 103,402 shares of series A cumulative con¬

vertible preferred stock (par $50) to be offered to com¬
stockholders

mon

basis

one

preferred share for

Price—To be filed by amendment,
along with dividend rate. Underwriter—Smith, Barney
& Co., New York. Proceeds—To pay promissory
note,
to complete purchase of a new plant at El Monte, Calif.,
and for additional working capital.
Statement may be

withdrawn.
It was reported on Oct. 5 that
has completed purchase of El Monte plant.

company

Felters

(letter of notification) 490,000 shares of common

Price—At par

stock.

Box

(letter

stock

Co., Boston, Mass.
(letter of notification) 1,750 shares of common
stock (par $10).
Price — At market (estimated at not
more than $10 per share).
Underwriter — H. C. Wainwright & Co., Boston, Mass. Proceeds—To two selling
Nov.

type.

56, Carrizozo. N. M.

stockholders.
•

First

Office—210 South St., Boston, Mass.

Investors

Corp., New York
Dec. 14 filed $3,000,000 DW plans
(periodic payment
plans with insurance protection), $7,000,000 DWN Plans
(period payment plans without insurance protection)
and $2,000,000 DWP Plans (single payment plans). Pro¬
ceeds—For accumulation of shares of Wellington Fund,
Inc. Sponsor—First Investors Corp.
General
Dec.

Racing Corp., Providence, R. I.
(letter of notification) 12,000 shares of common

Cosmopolitan Hotel Co. of Dallas, Tex.
Dec. 13 filed $1,500,000 of 2% debentures due 1965. Price

stock

—At face value.

Underwriter—None.

Commerce to

Underwriter—None.

Proceeds—To pur¬

Dallas.^Co., Inc., which com¬

secure

construction of hotel.

(letter

notification)

12,000

cumulative

preferred stock.
Price—At par ($25 per
share). Underwriter—Heimerdinger & Straus, New York.
Proceeds—For working capital. Office—6th and Jeffer¬
son

Streets, Camden, N. J.

Now being offered.

Culver

Corp., Chicago, III.
Oct. 23 filed 132,182 shares of common stock (par $5),
of which 4,818 shares are to be offered to stockholders
and 127,364 shares to public. Price — To stockholders at
$5 per share and to public at $6.25 per share. Under¬
writer—None.

and

commpn,

10,000 shares of preferred stock. Price—For
$2 per share and for preferred, $10 per share.
Proceeds—For
operating stables,

buying, selling, trading, etc. in racing horses. Office—
818 Industrial Trust Building, Providence, R. I.
•

Gold

Star Mining & Milling Corp.,
Missoula, Mont.
(letter of notification) 1,000,000 shares of non¬
assessable common stock of which not in excess 100,000
shares will be issued fcf employees as part payment of
wages.
Price—15 cents per share. Underwriter—None.
Proceeds—To develop mine. Office — 51 Higgins Bldg.,
Missoula, Mont.

Nov.

Courtland Manufacturing Co.
Dec.

Greenwich Gas Co.,

Greenwich, Conn.

Sept. 1 (letter of notification) 8,000 shares of $1.50 pre¬
ferred stock (no par) and 9,777 shares of common stock

(no par), to be offered first to stockholders.
Continued,

Price—Of

page

Proceeds—For investments.

Daily Reporter, Inc., Tuscon, Ariz.
Nov. 22
stock.
None.

Corp.

common

capital.

Price—At 100 issuable in multiples
Statement effective Dec. 7.

1,500 shares of preferred
share). Underwriter—
Proceeds—For equipment and operating expenses.
(letter of notification)

Price—At

Dansker

common

Price—At par ($1 per share). Underwriter—None.
Proceeds—For prosecution of application for certificate

Central

—

Mo.

filed

and

Charlotte, N. C.

25,000 shares of

stock.

Nov.

Proceeds
For
working
Ave., New York 27, N. Y.

stockholders.

—

will construct Dallas hotel. Business—A non-profit
corporation under sponsorship of Dallas Chamber of

Brass

rate

Price

None.

—

chase debentures of Statler

Price—At par ($10 per share). Underwriter—None. Pro¬
ceeds—To enlarge insurance business.
Office—221 No.
21st St., Birmingham, Ala.

Dec.

common

non-cumulative
$12.50 per share.

pany

Co.

10,000 shares of

present

$10).

(par

To be added to general funds.
erative wholesale purchasing

Co., Inc., Baltimore,

Proceeds—To promote sale of Foster pitching arms
use in baseball batting ranges.
Office-^-2439 N. Charles St., Baltimore 18, Md.

Birmingham

stock

City,
14

ated

Products

Co., Poplar Grove, III.
of notification) 8,684 shares of class A
(par $10) and 21,710 shares of common stock (par
$1). Price—At par. Underwriter—None. Proceeds—To
complete sewage disposal plant and build warehouse.
1

each 12 shares held.

and 4,000 shares of 7%

Consumers Cooperative Association,

Md.

with automatic feeds for

doch

(no par)

Nov.

Edenfruit

Dec.

stock to

Commonwealth Edison Co., Chicago, III.
Dec. 13 filed $49,000,000 of sinking fund debentures due

tion

Baltimore, Md.
Dec. 7

loans.

indebtedness and $2,000,000 of 10-year
certificates
of indebtedness to be offered to members of the Associa¬

Equipment Corp.,

Proceeds—To pay
price for building ($20,000) and for

Dec. 20 filed 50,000 shares of convertible preferred stock

shares of capital
Underwriter—Con¬

Proceeds—To

notification) 340,000 shares of com¬
Price—75 cents per share. Under¬

(par 10c).

working capital.

48,046

Price—At par ($5 per share).

tinental

(letter of

balance of purchase

Clark Controller Co.

Underwriter

(letter of notification)

expected
Un¬

writer—Olds & Co., Jersey City, N. J.

Office—2340 Eighth

Corp., Tulsa, Okla.

are

Duggan's Distillers Products Corp.
Oct.
mon

Underwriters—Straus &

None.

Jan. 29, 1951 and

Offering—Expected after Jan. 1, 1951.

bentures

Underwriter—None.

Ampal-American Palestine Trading Corp., N. Y.
Dec. 8 filed $5,000,000 of 15-year 4%
sinking fund bonds,
series A, due 1966.
Underwriter—None. Proceeds—To
develop and expand agricultural, industrial and commer¬
cial

Jan. 3, 1951. Price—$57.50 per share.
derwriter—None.
Proceeds—For working capital.

filed 200,000

Price—$15

116,662 shares of

be offered

ness—Manufacturer of industrial electric controls.

American Gas & Electric Co.
to

Nov.

offerings will terminate

•

Carnegie, Pa.

(par

Nov. 9 filed

Chicago Bridge & Iron Co., Chicago, III.
Dec. 12 (letter of notification) 8,746 shares of common
stock (par $20). Price—$34.30 per share. Underwriter—
None. Proceeds—For working capital. Office—1305 West
105th St., Chicago 43, 111.

par

($100

per

Realty & Securities Corp., N. Y. City

Nov. 20 filed 300,000

shares of 6% cumulative convertible
and 300,000 shares of class B
stock (par 35 cents) to be offered in units of
one preferred and one
class B share "on a best-efforts
basis." An additional 25,000 shares of each class of stock
preferred stock

(par $5)

common

are

to be issued to underwriters

additional compensa¬

tion for resale to

public. There will be reserved for con¬
version of the preferred stock 1,300,000 shares of class B
common stock. Price—$6 per unit. Underwriter—Dansker
Bros.

capital.

Co., Inc., New York. Proceeds — For working
Offering—Expected after the first of the year.

New York

Boston

Philadelphia

Pittsburgh

San Francisco

Private Wires to all

offices

Chicago

Cleveland

The Commercial and Financial Chronicle

(2472)

•

Continued

from

preferred, $25

per

retire

Putnam

$10

lative

share.

per

NEW ISSUE CALENDAR

Co., Boston, Mass. Pro¬
and
for working capital.

loan

bank

common

Financing Postponed—On Dec. 1

company

stated

financing plan is being prepared and will be submitted

Skiatron Electronics & Television Corp.__Common

Hamilton

Fire

Insurance

Co., Philadelphia
shares of capita)
ecock (par $5). Price—$4.50 per share.
Underwriter—
Jenks, Kirkland & Co., Philadelphia, Pa. Proceeds—To
increase capital and surplus in order to offer additional
lines of insurance, including automobile casualty and
liability coverage. Financing may be abandoned.
Oct.

(letter

of notification)

Hammond

January 3,

menial

1951
—Bonds

Southern Natural Gas Co

Common

Nevada-Tungsten Corp.

«$25 per share).

Underwriter—None.

Proceeds

—

From

this offering, plus a $2,000,000 term bank loan, to be used

bank loans, for improvements to properties and
working capital.

repay

•for
•

Holeproof

Dec.

Hosiery

Co.,

Milwaukee,

(letter of notification)

Wis.

20,000 shares of

common

etock (par $5). Price—$14 per share. Underwriter—None.
Proceeds—For working capital. Office—404 West Fowler

St., Milwaukee, Wis.
Hooper Telephone Co., Hooper, Neb.
A.ug. 18 (letter of notification) $30,000 of 3%%
(due

Price—In

1970.

excess

102%.

7/achob Bender Corp., Omaha, Neb.
temporary loans.

bonds

Underwriter—

Proceeds—To retire

ferred stock, 5%

series.

Price—At

Roast, Inc., Boston, Mass.
(letter of notification) 207,000 shares of common
to be initially offered to
stockholders; unsubscribed

stock

•shares to public. Price—At par ($1 per share). Under¬
writer—None. Proceeds—To finance the purchase of 100
automatic
coffee-roasting machines.
Office—84 State

St., Boston, Mass.
•

Jamesflex

Proceeds—For

Manufacturing Co., Inc., Phoenix,

Ariz.

Dec. 8
(letter of notification) 2 000 shares of caoital
stock. Price—At par ($5 per
share). Underwriter—None.
Proceeds—For operating expenses.

Kaye-Halbert Corp.
Oct. 6 by amendment filed
120,000 shares of class A con¬
common stock
(par $1). Price—$5 per share.

vertible

Underwriter—Sills, Fairman & Harris, Inc., Chicago, 111.
■Proceeds—To pay off promissory notes and for
working
capital.'

Service

Corp., Washington, D. C.

Dec. 12 filed 80,000 shares of
$1.50 cumulative preferred
stock (no par—with stated value of
$22.50 per share),
with warrants attached
entitling the holder to purchase
common stock at $12
per share in the ratio of two com-

shares for each five preferred shares held., Of said

mon

80,000

shares, 46,950 shares are to be offered in ex¬
change for outstanding 7% prior preferred stock (oar
$50) and 6% participating preferred stock (par $25)"on
the following basis: (1) For each 7% prior preferred

Bhare two

;

preferred shares; and (2) For each 6%
participating preferred: share one share of new pre¬
ferred stock—plus in each case accrued and
unpaid div-

new

fdends and redemption premiums, in cash. The remain¬
ing 33,050 shares are to be publicly offered. Price—$25
per share.

Underwriter—Johnston, Lemon & Co., Wash¬

ington,

redeem

unexchanged old preferred stock.

Proceeds—For

working

capital

and

Nov.

17 filed

Price

—

83,000 shares of

To be supplied

Office—333

purposes.

common

•

City, Okla.
Dec. 6 (letter of notification) 1,250 shares of $5 cumula¬
tive preferred stock (par $1), redeemable at $100 per
share.
Price—$100 per share Underwriter—None. Pro¬
ceeds—For working capital. Office—212V2 N. W. Fifth
St., Oklahoma City, Okla.
Mission Appliance Corp., Hawthorne, Calif.
July 24 filed 50,000 shares of 6% cumulative convertible
preferred stock. Price—At par ($20 per share). Under¬

writer—Lester & Co., Los Angeles, Calif. Proceeds—To
install machinery and equipment

proposed new plant to be located east of the Rocky

Mountains.

(par $1).

by amendment. Underwriter—

Business—Manufacturer of gas and electric

water and space

Shirt Shops of Delaware, Inc.
(letter of notification) 8,000 shares of common
(par $1). Price—$12.50 per share. Underwriter—

National
18

Emanuel Deetjen

Co., New York.

Proceeds—To four

selling stockholders.
Nesco, Inc., Milwaukee, Wis.
1 (letter of notification) 30,000 shares of common
stock (par $5), to be offered for subscription
by em¬
ployees and officers of the company. Price—To be $1
per share less than the last sale price on the New York
Stock Exchange on day next preceding date of offering
of

stockholders'

meeting, at which

plan

sale

adopted, whichever is lower.- Proceeds—For additional
treasury funds

additional receivables and inventories

be carried.

can

Shipley Wholesale Drug Co.
15 (letter of notification) 2,900 shares of 4% cumu¬

Office—270 No. 12th Street, Milwaukee,

stock

preferred

per share).
$250,0C0 8%

retire

and to retire sales credits.
Pittsburgh 13, Pa.

$100)

(par

($100

par

Proceeds—To

Office—4724 Baum Boulevard,

stock

40,000 shares of common

(letter of notification)

Price—$3

100).

(par

Underwriter—

share.

per

New York.
Proceeds—To complete
"Subscriber-Vision" tests, to purchase equipment • and
Leslie

d'Avigdor,

for general

overhead.

South
Nov.
par

filed 560,000

(Canada)

Ltd.

Mines

Uranium

State

($1 per share). Underwriter-Optionee—Robert Irwin
Proceeds—For commissions, explora¬

and working capital.

tion and development expenses,

Box

West

South

Co., Keokuk, Iowa
Nov. 27 (letter of notification) $200,000 10-year 6% sub¬
ordinated instalment debenture bonds. Price—To be sold
in multiples of $100 plus accrued interest. Underwriter
Proceeds—For corrugated machine.

—None.

Nov. 20
stock

Underwriter—
Proceeds—For

share.

per

Wagner, Reid & Ebinger, Louisville, Ky.
construction and improvement.
Southern

Discount

stock

mon

(par

one

cent).

Price—15

Underwriter—Tellier

working capital.

cents

share.
Proceeds—For
per

& Co., New York.
Office—15 Exchange Place, Jersey City

2, N. J.

Co., Atlanta, Ga.

Dec.

Co., Fergus Fails, Minn.
(letter of notification) 4,990 shares of common

stock

Power

(par $5).
per

Minn.;

Price—At approximately market (about
Underwriters—Kalman & Co., St.

share).

Olson

Glore, Forgan & Co., Chicago, 111.; and
Co., Fergus Falls, Minn.
Proceeds—To
Cyrus G. Wright, executors of the will

Thomas C. and

■

;

Sept. 18 (letter of notification) $191,500 of 5% subordin¬
ated debentures, series E. Price—At par. Underwriter—
For $100,000 of debentures, Allen & Co., Lakeland, Fla.
Proceeds—To

reduce

tal. Office—220
•

bank

Price—$9.50

par).

Proceeds—To

None.

working capi¬

Co., Knoxville/ Tenn.
5,000 shares of capital

(letter of notification)

stock .(no

and for

loans

Healey Bldg., Atlanta, Ga.

Fire & Casualty

Southern

share. Underwriter—
operations.
Office—4277

per

expand

Lyons View Pike, Knoxville, Tenn.

Southern

Nov.

Insurance, Inc., Atlanta, Ga. :
(letter of notification) 30,000 shares of common

stock.

.Price—At

None.

share). Underwriter—<
stock in Southern Fire &
reduce debt.
Office—79

Proceeds—To purchase

Marine

($10

par

Insurance

Co.

per

and

Ponce De Leon Ave., N. E., Atlanta.
•

Natural

Southern

Gas

Ga.

•

Co., Birmingham, Ala.- >
—

.,'

$17,500,000 of first mortgage pipeline bonds

due Dec.

1, 1970. Underwriter — To be determined by
competitive bidding. Probable bidders: Halsey, Stuart &
Co.

Inc.; Blyth & Co., Inc. and Kidder, Peabody & Co.
(jointly); The First Boston Corp. Proceeds—To repay
bank loans and for expansion program. Bids—Expected
to be

Otter Tail

Fla.

10,000 shares of common

Price—$11.25

(par $10).

Tallahassee,

Co.,

Telephone

(letter of notification)

(1/23)

Nevada-Tungsten Corp., Jersey City, N.J. (2/1)
Dec. 7 (letter of notification) 2,000,000 shares of com¬

Price—At

shares of capital stock.

Martin of Toronto.

Dec. 18 filed

•

(12/22)!'

Skiatron Electronics & Television Corp.

•

Dec.

Wis.

Price—At

preferred stock.

Underwriter—None.

Dec.

•

Southeastern

Co., Evanston, III.
Nov. 29 (letter of notification) 300,000 shares of common
stock (no par) to be sold to a group of 20 individuals.
Price—$1 per share. Underwriter—None. Proceeds—For
operating capital, and to complete purchase of tools, dies
and inventory from Kurtis-Kraft, Inc. Office—1000 Grey
Ave., Evanston, 111.
•

Price—At the market (approximately $5 per
Underwriter—Harris, Upham & Co., New York.
Proceeds—For general corporate purposes.
(par $5).

share).

heaters.

Muntz Car

Dec.

Mining Corp.

(letter of notification) 597 shares of capital stock

lative

Midwestern Insurance Co., Oklahoma

Faul,
stock

(no par) to

under its "Em¬

company

Dec.

Co., Newark, N. J.
Feb. 9 (letter of notification) 5,200 shares of common
stock offered to common stockholders at $50 per share
on
a one-for-five basis.
Underwriter—Clark, Dodge &
Co.
Proceeds—To pay notes and for additional working
capital. Indefinitely postponed.

$18.75

LyttoiTs, Henry C. Lytton & Co.

share).
San Fran¬

per

Middlesex Water

stock

Lincoln

Securities

corporate

($20
Corp. of
par

Montgomery Street, San Francisco, Calif.

Infra

employees of the

Shattuck-Benn

retire bank loans and

Nov. 3

Chester, Pa.

23,529 shares of common stock

filed

Dec. 8

Mercantile Acceptance Corp. of California
Dec. 4 (letter of notification) 5,000 shares of first pre¬

cisco.

preferred stock, to be offered for subscription by com¬
mon stockholders on the basis of one preferred share for
each seven shares of common stock held on Dec. 18,
1950;
rights
to
expire
Jan.
10.
Price — At
par

tampons.

earnings.

Underwriter—Guardian

Stores, Inc., N. Y. City

Investing Securities, Inc., and James C.

ployees' Stock Purchase Plan for 1951." The company
a maximum of 5,000 memberships in the plan
under which any eligible employee may subscribe for
an amount up to but
not exceeding 10% of his weekly

1951

•

Hearn Department

Md.

Taneytown,

anticipates
February

—

Nov. 17 filed 40,000 shares of 5% cumulative convertible

Co.

be offered

Kaniey Hydrojet, Inc., Prospect, Ohio
Dec. 11 (letter of notification) 500 shares of 5% nonconvertible preferred stock.
Price—At par ($100 per
fihare). Underwriter — None. Proceeds — For working
capital.

Corp.,

110,000 shares of common stock (par $1).
less than $6 per share.
Underwriters—

Scott Paper Co.,
Dec. 5

(par $20).

(letter

1951
Common

not

and

Ward

..Common

January

Office—Arthur

13, N. Y.

Kennedy, Jr., of New York. Proceeds—For construction
and working capital. Business — Manufacture of cata-

Wilcox-Gay Corp.

Co., San Francisco, Calif.
notification) 7,000 shares of capital
Price—$42.50 per share. Underwriter—
None. Proceeds
For working capital.
Office — 417
Montgomery St., San Francisco, Calif.
Nov.

Preferred

Chemical

Dow

filed

Price—At

Rossville Byestuff Corp

64,000

Lumber

Etock

1951

Products

Sanitary

Dec.

January 2,

($100 per share).'

par

Proceeds—To pay debt and for cap¬

Road, Staten Island

•

to stockholders.

Price—At

preferred stock.

improvements and working capital.

Kill

1950

(1/2)

(letter of notification) 1,000 shares of 6% cumu¬

Underwriter—None.
ital

December 22,

new

Thursday, December 21, 1950

Rossville Dyestuff Corp.

Dec. 14

share, and

Underwriter—F. L.
ceeds—To

page

...

•

opened

Jan. 23.

Southern Natural

Gas

Co.-

}

Dec. 18 filed 155,546 shares of common stock
to

offered

for

subscription by

the basis of

oversubscription privilege.
loans

and

shares held;

Price

for. expansion

stockholders
with
To be filed by

common

share for each

Underwrtier—None.

amendment.

bank

one

(par $7.50)

—

Proceeds

program.

repay

Offering^Ex-

Blunt Ellis & Simmons,, Chicago, 111. Proceeds—To the
executors of the estate of
Henry C. Lytton. Statement

of Grace Clark:

to be withdrawn.

Enterprises, Inc., Bfuefield, W. Va,
Dec. 1 (letter of notification) 670 shares of common stock
(voting and non-assessable). PriceAt par ($100 per

Sparkman & McLean Co., Seattle,-Wash.
l
Dec. 8 (letter of notification) 2,000 share& of preferred

share).

($100 per share). Underwriter

Magnolia Lead & Oil Co., Salt Lake City, Utah.
6 (letter of notification)
300,000 shares of capital

Dec.

stock.

Price—At

Cromer

par

Brokerage

(10c

Co.,

develop uranium vxide

Salt

ore

share).
Underwriter—
Lake City. Proceeds—To

per

properties.

•

Wright (deceased).

pected latter part of January.

Pioneer

Underwriter—None.

capital. Office
W. Va.

—

Law

and

Proceeds
Commerce

—

For

working

Bldg., Bluefield,

•

Oct. 27
stock.

(par 10) to be offered in units of

Mascot

Mines, Inc., Kellogg, Ida,
(letter of notification) 400,000 shares of capital
Price—37V2 cents per share. Underwriter—Stand¬

ard Securities

•

Corp., Spokane, Wash. Proceeds—To purchase controlling interest in Pine Creek Lead-Zinc Min4ng Co., for development costs and working capital."
McCormick &

Co., Inc., Baltimore, Md.
(letter of notification) 1,000 shares of 5% cumuIative preferred stock (par
$100), 4,500 shares of nonvoting common stock.jGnQ-.parbaptf 4,590 shares of voting
Nov. 22

;
-

stock

(np par)!?Prfce—The preferred at par and
the
market.. ('approximately $22 per
Bhare). Underwriter—Alex. 'Brown & Sons, Baltimore,
Md, Proceeds—For working capital. Office—414
Light
Street, Baltimore 2, Md.
common

the

common

and

one

share of

common

Underwriter—Aetna

stock.

Securities

one

Price—$2.05

Corp., New York.

unit.

Pro¬

capital.
Office—2016 Bronxdale Ave., New
Expected after the first of the year.

York

60, N. Y.

Ramie Products Corp.
•Sept. 21 (letter of notification) 25,000 shares of common
stock
(par $3).
Price—$3 per share. -Underwriter—

Smith,

Talbott

Sharpe, Pittsburgh, Pa. Proceeds—
machinery arid equipment and
working capital.
Office—507 Liberty Aventie,' Pitts¬
burgh 22, Pa:' '
I * 1 I *.♦, -t.v i r ;. xs
i
j
It •;)"
~
\
:vtv vrr*' i->
1 .vtv.t >T
For purchase of additional

Dec. 4

—

None/! Proceedsrf-For

Warehouse

Storage

Co.,
•

(letter of notification)

■'MV

Spdkane,
:'!,r

•

$270,000 of first ihortgage

6% bonds due Dec. 31, 1960, and 270,000 shades of com*
of

per

2% participation. Price-*A1 par

Wash.

ceeds—To purchase patents and equipment and for work¬

ing

Spokane

mon

class

working capital. Office—1110 Third Ave., Seattle!, Wash.

Privat-Ear

Corp., New York City
Dec. 12 (letter of notification) 112,500 shares of class A
stock
(par $1) and 112,500 shares of common stock

stock, first series, with

Office—328 Atlas

Bldg., Salt Lake City.

•

stock (par 10

cents), the bonds to be offered.in/units

$100 each, or in multiples thereof, with the stock to

issued

for

each

bonus

the

rate

one

of,«stock;

purchased. Price — At principal
amount for the bonds. Underwriter—Richard W. Bowler,
$1

of bonds

Spokane, Wash. Proceeds—To purchase building. Office
Paulsen Bldg., Spokane, Wash.
^
.

—214
•

„

Scranton, Pa. vX
> i
;
Dec. 11 (letter of notification)1 50,000 shares of commoii
stock (no par), which includes 35,600 shares previously
sold at prices ranging from $1.25 to $1.87V2 per share
and now covered by rescission *>of£er» ^-The < additional
14,400 shares will be offered L!at the market" Under*
writer—The First Guardian Securities Corp., New; York*
Standard Brewing Go. of

.Volume 172

Number 4970

The Commercial and Financial Chronicle

(2473)
Proceeds—To Patrick F. Cusick,.Chairman of the Board,
the selling stockholder.
•"

Standard Oil

Co.

of California

Dec. 6 (letter of notification) not to exceed 2,035.9 shares
of capital stock (no par) to be offered by The Chase Na¬
tional Bank of the City of New York.
Price—$78.62V2

share.

per

Underwriter—None.

of holders

Proceeds—For

Halsey, Stuart & Co. Inc.; W. C. Langley & Co. and First
Boston Corp. (jointly);
Kidder, Peabody & Co. and Mer¬
rill Lynch,
Pierce, Fenner & Beane (jointly); Lehman
brothers; Equitable Securities Corp.; Smith, Barney &
Co.

Proceeds—For construction program.
ed first week in February.

benefit

Oct.

stockholders

common

Sunshine

Packing Corp. of Pennsylvania
(letter of notification) 2,950 shares of 5%

stock,

(there

increase

the

authorized

Under¬

operating capi¬
tal. Office—Smedley Street, North East, Pa. Business—
Processes and cans frozen fruits and fruit juices.

Moseley & Co.; White, Weld & Co.; Hemphill, Noyes,
Graham, Parsons & Co., and H. M. Byllesby & Co., Inc.

ferred

stock.

Price—At

writer—None.

Texas

Nov.

per

share).

pre¬

Proceeds—For additional

Illinois

filed

Natural

Gas

300,000 shares of

being offered to
on

($100

par

the basis of

new

Pipeline Co.
stock

common

(oar $1),

share for

each

IV2 snares held.

(Peoples Gas Light & Coke Co., owner of approximately
51% of outstanding common stock, will subscribe for its
proportionate share of
scribed

stock, plus any other unsub¬
Rights will expire on Dec. 28.
Price—

shares.

new

$10 per share.

Proceeds—To finance proposed pipeline
from Texas to Chicago. Statement effective Dec. 8.
•

Transportation Lease Co., San Francisco, Calif.

Dec.

(letter of notification)

20,000 shares of 4%

non-

cumulative, non-participating, non-voting, non-convert¬
ible preferred stock (par $5) and 3,300 shares of common
stock (par $5). Of the preferred stock, 10,300 shares will
be

offered

common

Traditional

Ohio

reported

was

underwriters:

Ry.

contemplates issuance

company

$7,500,000 equipment trust certificates.

Probable bid¬

Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.
Bids—Expected in January.
Chicago,

Bids

will

cago,

111.,

Indianapolis & Louisville

received

to 12 o'clock

the

Ry.

company's office

Chi¬

(CST) on Jan. 3 for the
$1,200,000 of equipment trust cer¬
tificates to be dated March 1, 1951 and mature semi¬
annually 1952 through 1966. Probable bidders: Halsey,
Stuart & Co. Inc.; Salomon Bros. &
Hutzler; Lehman
Brothers, Bear, Stearns & Co. and Schoellkopf, Hutton
& Pomero.y, Inc. (jointly).
up

purchase

exchange for the same number of shares
capital stock, 4,800 will be offered in can¬
indebtedness to

from

noon

Clinton Foods,

the shareholder-automobile

Dec.

12, it

vote

amount

$1)

Lighting & Power Co.
new

Proceeds—For

construction

Offering—

program.

February.

Kansas-Nebraska

the

1,500,GOO

authorized

2,000,000

Natural

Gas

Co.

Nov. 24 company applied to the FPC for
permission to
increase capacity from 146,000,000 cubic feet to
000

cubic

feet

daily at

estimated

cost

financed by bonds, preferred and

164,200,$5,201,331,

common

stocks.

Bonds may be placed privately through Central
Republic
Co., Chicago. Probable underwriters for the stocks are
Cruttenden & Co., Chicago, and First Trust Co. of Lin¬

coln, Neb.
Star

Steel

Corp.

Nov. 12, it was reported that company
may issue and sell
additional securities should it receive government con¬
sent

the

writers:

building of

Straus &

new

plant.

Probable

under¬

Blosser; Estabrook & Co., and Dall&s-

Rupee & Son.
•

MacMillan

Dec.

18 it

Co.,

New

York

reported early registration is expected of
approximately 170,000 shares of common stock. Under¬
was

writers—Hemphill, Noyes, Graham, Parsons & Co., New
York.
Proceeds—To
selling
stockholders.
Expected

Inc.

announced stockholders

was

increasing

from

underwriter;

Halsey, Stuart & Co. Inc.; Dillon, Read & Co.

Lone
•

Traditional

was

Expected in January

to be

ders:

equal to par value, and 4,900 shares
all of the shareholder-auto dealers as shall

any

stock.

common

cellation of
dealers

Dec.

1951.

are

Chesapeake &

stockholders of record Dec.

common

one

tional

Co., New York.

reported company plans to issue and sell
first mortgage bonds. Underwriters
determined by competitive
bidding. Probable

Inc.

presently 396,000 shares outstanding).
The management has no present
plans to issue any addi¬

Dec.

bidders:

voted

Houston

Dec.

—To

$5, from 500,000 shares to 1,000,000

par

•

March

$15,000,000 of

Carpenter Steel Co.

capital stock scrip certificates issued Jan.

28, 1949.

Bids—Expect¬

tribution
Estabrook

Jan.

common

the

will

about Jan.

stock

(par
increase to

16.

Marion

;

Power

Shovel

•

Co.

become shareholders of the corporation. The 3,300 com¬
mon shares will be offered for cash or credit from select¬

"substantial funds for capital additions and
working capital," and "to provide for the conversion of

Dfec. 8, the company announced it plans the sale of addi¬
tional common stock (par $5) so as to add

ed auto dealers in various communities who
may be in¬
vited to membership in this corporation, all ac $5 per
share. Purpose—To exchange preferred for common, to

100,000 shares of unissued and unreserved 4%%

$500,000 to equity capital, such shares to be first offered
to present common stockholders on a pro rata basis.

provide

lative

convertible

writers:

Merrill

preferred

stock."

Probable

cumu¬

Under¬

Lynch, Pierce, Fenner & Beane.

cancel

existing indebtedness, and to assist in financing
purchase of new autos for leasing. Office—25 Califor¬
nia St., San Francisco, Calif.
of

Vitro

Manufacturing Co.
(letter of notification) 30,000 shares of

Dec. 4
stock

(par $1) to be offered to

record

Dec.

basis of

common

share for each

new

one

common

stockholders of
5.64

shares held; rights to expire Jan. 2. Price—$10 per share.
Underwriter—None. Proceeds—For initial working capi¬
tal

Vitro

Chemicacl

Co.,

Inc.,

subsidiary,

formed in December, 1950, to acquire and operate a plant
in Salt Lake

City, Utah, for the processing of uranium
and manganese ores. Office—60 Greenway Drive, Corliss
Station, Pittsburgh 4, Pa.

Columbia
Dec.

Extension, Inc., Wallace, Idaho
Nov. 27 (letter of notification) 250,000 shares of capital
stock (par 20 cents). Price—31 cents per share. Under¬
writer—J. A. Hogle & Co., Spokane, Wash. Proceeds—
For initial working capital for ore development. Address
—c/o H.

Hull & Sons, Wallace, Idaho.

Westerly
Dec.

(R. I.) Automatic Telephone Co.
(letter of notification) 7,000 shares of common

stock

offered

stockholders

record

Dec.

1950, of which total 4,434 shares will be subscribed for
by New England Telephone & Telegraph Co. Price—At
par ($25 per share). Underwriter—None. Proceeds—For
general corporate purposes. Office—38 Main St., Wes¬
terly, Rhode Island.

Wilcox-Gay Corp., Charlotte, Mich. (1/3)
25 filed 500,000 shares of common stock (par $1).
Price—To be supplied by amendment. Underwriters—
Gearhart, Kinnard & Otis, Inc., New York, N. Y., and
White & Co., St. Louis, Mo. Proceeds—To pay obligations
Oct.

to all unsecured creditors.

■■

Gas

System, Inc.

reported that corporation may issue and
sell $35,000,000 of new securities in the Spring or early
was

Probable bidders for debentures: Halsey, Stuart
Inc.; Morgan, Stanley & Co.; Kuhn, Loeb & Co.;
Salomon Bros.
&
Hutzler; Lehman Brothers; Merrill
Lynch, Pierce, Fenner & Beane and White, Weld & Co.
(jointly). Probable bidders for common stock, in event
of competitive bidding: Morgan Stanley & Co.; Goldman,
summer.

Co.

Sachs & Co. and Union
rill

Securities Corp.

Lynch, Pierce, Fenner

Shields

Co.

and

(jointly); Mer¬
& Beane; Lehman Brothers;
Pressprich & Co. (jointly).

Proceeds will be used for expansion program.

Vulcan

with

the

was

announced

company

plans to register
a proposed of¬

SEC by the end of December

Halsey, Stuart & Co. Inc.; The First, Boston Corp. .and
White, Weld

& Co. (jointly);'Harriman' Ripley & Co.
Inc. and Alex. Brown & Sons (jointly); Kuhn, Loeb &
Co.

Bids—Expected to be invited during the latter part
January.
El Paso

12, it was announced the company has applied to
the FPC for authority to issue and sell $4,500,000 of first
mortgage bonds due Dec. 1, 1980. Underwriters—To be
determined by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Stone & Webster Securities
Corp.; Merrill Lynch, Pierce, Fenner and Beane; Salo¬
mon Bros. & Hutzler; Kidder, Peabody & Co.; Equitable
Securities Corp.
Proceeds—To redeem - $1,000,000 of
Vh% bonds due 1978 and for construction program.
,

Emerson

Algonquin Gas Transmission Co.
Nov. 8 the FPC said

of the

opinion that certain
cf the New England markets should be served by this
company, upon showing that it has an adequate amount
of

was

financing, probably about $40,000,000, likely to be 75% bonds and 25% stock, with com¬
Necessary

gas.

mon

stock to be offered first to stockholders.

Probable

underwriter: Dillon, Read & Co. Inc.

American Bosch Corp.

Nov/22'it

was

new

ently outstanding 16,336 shares of 5%
ferred stock.

cumulative
»\
«'

pre¬

/•*'•

Capital Plastics," Inc.
Nov.- 2B, it was announced that it is planned to offer
■

common

stockholders of Rocliester

subscribe for 131,025 shares of

Probable

Button Co.

capital stock

rights to
the basis

sale

issue

•

was said to be
convertible pre¬

Erie RR.
was

reported

company

plans to issue and sell

$5,400,000 of equipment .trust certificates.
bidders: Halsey Stuart & Co. Inc.; 'Salomon

January

Probable

Bros.

one

each present share of
of record Dec. 18, 1950;

rights to expire about Jan. 16. Price—$1
ceeds—To

acquire /Eecbperl and

per

share.. Pro¬

^rodhead Divisions of

Rochester Button Cq>;} which are engaged in plastic, oper¬
ations. Offering—Rights expected to be mailed early in

January, 1951,./.
Carolina Power

Oct.

stockholders

this

Inc.

The estimated cost of the new facilities is 7
$5,500,000. Previous bond financing was arranged for
privately through Union Securities Corp., who also acted
plued later.

underwriter for

a common

stock issue in April of th>r

year.

Monarch Machine Tool Co.

Nov.

Dec.

announced that stockholders will vole
plan to increase the authorized common

was
a;

slock from 250,000

shares to 750,000 shares and splitting
the present 210,000 outstanding shares on a two-forbasis, If any new financing, probable underwriters
will include F. Eberstadt & Co., Inc., of New York, and
Prescott, Hawley, Shepard & Co./ Inc.," of Cleveland*

one

;>'■;■'-■•.•.•■■

Monongahela
Dec.

-7

Power Co.

announced

plans issuance and 1
Underwriters — To be ,
determined by competitive bidding. - Probable biddersi *
Halsey, Stuart & Co. Inc.; Equitable Securities Corp.; W.
C. Langley & Co. and The First Boston Corp. (jointly); ;
Union Securities Corp.; Salomon Bros. & Hutzler; Lefrman Brothers; Kidder, Peabody & Co^ and White, Weld
& Co. (jointly); Merrill Lynch, Pierce, Fenner & Beane; Glore, Forgan & Co. Proceeds—For expansion program.
Offering—Expected in March, 1951.
:
was

sale of $10,000,000

new

company

bonds.

company

Oct.

(formerly Finch

Telecommunications, Inc.) voted to create an authorized
issue of 400,000 shares of class A convertible stock (par
or part of which aire tq be publicly offered in the
future. Price—$2.50 per share. Underwriter—Gra¬

$1)„ all
near

Proceeds—To repay
working capital....

ham, Ross & Co., Inc., New York.
indebtedness to RFC and for

Firth

Nov. 30 it
on

Carpet Co.
was

creating

announced stockholders will vote Dec. 20

authorized issue of 30,000 shares of new

preferred stock (par $100),-; of which it is initially
planned, to issue and sell 10,000 shares to provide addi¬
tional working capital.
Traditional underwriter: Rey¬
nolds & Co., New

plans to finance the instal¬

on the company^ "
pipeline system in Arkansas and Missouri will, be sup-

Montana-Dakota

Electronics,

York.

&< Light

Co. •
Dec. 4 it was reported company plans issuance of $15.000,000 new first mortgage bonds. Underwriters— If
named by competitive bidding, probable bidders are:

announced that

share of capital stock for

Rochester Button stock held

was

lation of additional compressor units

Hutzler.

Facsimile &

Mississippi River Fuel Corp., St. Louis, Mo.
Oct. 4 it

underwriters:

14, it

Light Co.

Halsey, Stuart & Co. Inc.; Shields & Co.; The First
(jointly); Otis &
Co.; White, Weld & Co.; Lehman Brothers and Drexel &
Co. (jointly); Union Securities Corp.; Kidder, Peabody
& Co.; Coffin & Burr, Inc.

reported that the company

the

6, Clay C. Boswell, President, announced that the
company expects to raise about $10,000,000 through the
sale of new securities within the next year or so. The
financing may be either in the form of bonds or preferred
stock. The proceeds will be used for the
company's ex¬
pansion program. Probable bidders for bonds may in¬

Ohio.

Manufacturing Co.

Smith, Barney & Co.: Van Alstyne, Noel & Co.; Newhard, Cook & Co. Registration—
Expected about Dec. 29.
-

issue of 40,000 shares of 5% cumula¬
tive preferred stock (par $100), to be issued in series. Of
this issue* itis proposed to place privately with a group
of insurance companies 16,500 shares of series A pre¬
ferred, the proceeds to l?e used to redeem all. of the pres¬
crfeating a

considering

Electric

ferred stock first to stockholders on about a l-for-8 basis.

Dec.

announced stockholders will vote Dec. 18

was

Power

Dec.

Electric Co.

Dec.

Nov. 20 it

Minnesota

clude

fering of $25,000,000 new bonds. Underwriters — To be
determined by competitive bidding.
Probable bidders:

Registration—Expected to be effected in February, 1951.
Proceeds—The net proceeds from the sale of the stock,
together with proceeds from a proposed term loan of ap¬
proximately $2,500,000 with banks and an insurance com¬
pany, will be used to refund $1,175,000 bank loans, pay¬
ment of preferred dividend arrearages of
$1,501,500, and
the balance for working capital.

Boston Corp. and Glore, Forgan & Co.

Consolidated Gas Electric Light & Power Co.
of Baltimore

Nov.

approximately 1

Foote Mineral Co.

Nov. 20 company said it may sell during 1951 some addi*
common stock following proposed 200% stock dis¬

tional

Utilities

Co.

asked FPC for authority to issue $2,800,000 of 2Vz%> promissory notes to banks to provide funds for its expansion program. These, notes, together >
with $3,000,000 of notes authorized by FPC last May, are
to be refunded by permanent financing before April I./
1951. Traditional underwriters are Blyth & Co., Inc. and,,
11

company

Merrill

Nov.

Lynch, Pierce, Fenner & Beane. Stockholders on
will vote on increasing authorized preferred
stock from 100,000 to 150,000 shares and common stoclc
from 1,500,000 to 2,500,000 shares.
R. M. Heskett, Presi¬
dent, stated that about $10,000,000 will be raised within
the next six months,
v
-\ r.
;\
J;
' ■
27

tO*.

Nevada

•

'•'i

Natural Gps Pipe Line Co.

askei}

FPC 'to authorize construction and operation of a 114-mi^e pipeline for the transporta- ;
tion of natural gas, which, it is estimated/ will cost *
$2,331,350.
'
'•'/ •^ ;
Nov.

company

■

Continued

on page

The Commercial and Financial Chronicle
42

...

(2474)

RR.

York Central

New

said to be preparing to issue

the company was

Dec.. 11

•.

$7,500,000 of equipment trust

certificates after the turn
& Co. Inc.;

Probable bidders: Halsey, Stuart

of the year.

Salomon Bros. &

Hutzler.

Alex.
Brown & Sons (jointly); Glore, Forgan & Co.; Salomon
Bros. & Hutzler; Harriman Ripley & Co., Inc., and Union
Securities Corp. (jointly).
Proceeds — For expansion
program. Offering—Expected in April or May, 1951.
Corp. (jointly); Kidder, Peabody & Co. and

Boston

Public

Chicago & St. Louis

New York,

Co.

Service

Oct. 20 it

was

Union

Gas

Co.

reported company plans to raise between

$7,000,000 and $8,000,000 through the sale of new secur¬
ities next Spring. Underwriter — Blair, Rollins & Co.,
Inc., handled the financing early this year of $18,000,000
of first mortgage 2%% bonds and $3,000,000 of 4%%

Proceeds—To

preferred stock (par $100).

Colorado

repay

$3,000,-

000 of bank loans and for construction expenditures.

E. Loiseau, President, announced that "it will
be necessary to raise additional funds for construction
purposes in the second quarter of 1951.
The amount
needed is estimated at about $7,000,000." Probable bid¬

Nov. 1, J.

RR.

L. White, Chairman, announced that the
company plans to offer 33,770 shares of common stock
at the rate of one new share for each ten common shares
8 Lynne

Dec.

Southern

Inc.; W. C. Langley & Co. and The First

Co.

Stuart

Continued from page

Thursday, December 21, 1950

held, subject to the approval of the ICC. The offering
price to be fixed later, will be below the market price
prevailing at time of offering. Underwriters—None.

Transmission Ltd. (Canada)
Oct. 20, it was announced that this company, a subsidiary
of Consumers' Gas Co., plans to build a pipe line in
Canada to export from Tennessee Gas Transmission Co.
Texas natural gas by way of the Niagara border. The
total cost of the project is estimated at $6,000,000, of
which $2,000,000 will be represented by 400,000 shares
of capital stock, par $5, and $4,000,000 to be raised by the
Niagara Gas

securities in the fiscal year

$7,000,000 of debentures

Co. of Indiana,

Service

that

and

Inc.

the

preferred stock may be placed privately. The com¬
stock will probably be offered first to common
and underwritten by Dillon, Read & Co.

stockholders

31, company estimated that, in addition to the $40,000,000 bank credit arranged with eight banks, it may be

Proceeds—To be used for expansion program.

Inc.

Tennessee

during the period prior to Dec. 31, 1953, to
$40,000,000 in
take care of its construction program.

required,

additional funds of approximately

order to

It is

portion of the cash requirements will be derived
sale of additional common stock.
The bonds

from

Oct.

obtain

to end Aug. 31, 1951.

expected that the new senior securities to be sold will
consist of first mortgage bonds and preferred stock and

mon

Public

15, the company announced that it is anticipated
over
$17,500,000 will be raised f/om the sale of

that

which company had
planned to issue earlier this year were: Halsey, Stuart
& Co. Inc.; Blyth & Co., Inc. and Smith, Barney & Co.
(jointly); The First Boston Corp.; Lehman Brothers;
Kidder, Peabody & Co.; Harris, Hall & Co. (Inc.). This
latter plan was abandoned last August.
for

ders

Public Service Co.

Southwestern
Nov.

See

Gas

Co.

Transmission

accompanying item

Northeastern Gas Transmis¬

sion Co.

issue of bonds.
•

Niagara Mohawk Power Corp.

will
of additional debt or
equity financing in connection with its 1951 construction
which is expected to cost $52,328,000. This amount is in
addition to the sale on Oct. 31 of $40,000,000 general
mortgage bonds due Oct. 1, 1980. Probable bidders for
new bonds:
Halsey, Stuart & Co. Inc.; Morgan Stanley
& Co.; Kuhn, Loeb & Co.; The First Boston Corp.
estimated that, through 1951, it

Oct. 24 the company

require not more than $35,000,000

Gas Transmission

Northeastern

Nov. 8 FPC authorized company

Co.

to supply part of New/

England with natural gas, and authorized Tennessee Gas
Transmission Co., parent, to carry out a $118,645,545

expansion program, part of which will supply some of
Northeastern's gas needs. Of the total financing, 75%
will be in the form of first mortgage bonds to be placed

privately with a group of life insurance companies. The
remaining 25% would be obtained through the sale of
equity securities. Traditional underwriters for Tennes¬
see White, Weld & Co.; Stone & Webster Securities Corp.
Oklahoma Gas &

Electric Co.

provides,
$6,500,000

with an
of preferred stock having a lower
dividend rate "as soon as the transaction becomes eco¬
nomically sound," and to finance part of the company'?
construction program by the issuance and sale of addi¬
tional common stock. Stockholders were to vote Dec. 11
on changing each of the 1,076,900 shares of $20 common
stock now outstanding to two shares of common stock,
amount

par

changing the 825,000 shares of
$20 par, of 4% cumu¬
lative preferred stock to 165,000 shares of $100 par cu¬
mulative preferred stock. Probable underwriters: Harriman Ripley & Co., Inc.; Smith, Barney & Co.; Lehman
each; and

$10 par

authorized but unallotted shares,

Brothers.

Lighting Corp.
corporation
estimated

that

approximately

$24,000,000 will have to be raised through the sale of
securities next year to finance its 1951 construction pro¬

Traditional underwriter:

gram.

subscribe for 569,946

basis of

additional shares of common stock

held.

ferred

proximately 89% of Pacific's stocks.

Underwriter—None.

Pennsylvania Electric Co.
Oct. 4 company was

reported to be planning the issuance

Co.; Merrill Lynch, Pierce, Fenner & Beane; Union fSecurities Corp. and White, Weld & Co. (jointly); Equit¬
able Securities Corp.; The First Boston Corp.; Kuhn,

Co.; Harriman Ripley & Co., Inc.

to be used to finance

Proceeds are

construction program.

Chas.

•

San

Dec. 19 it

through the sale of securities.

Underwriters—The
Proceeds—To

Co.

First

Boston

Traditional

$3,200,000 bank loans and for

•

Air

Seaboard
13 it

Dec.

was

Corp.

and

Drexel

finance, in part, the company's con¬

authorizing indebtedness up to $6,000,000 for future

Company plans to expend

$3,500,000

additional for additions and improvements,

mostly in 1951.
Potomac

Dec.

was

announced that company plans to

$10,000,000 of new bonds.
mined by competitive

issue

Underwriters—To be deter¬

bidding. Probable bidders: Halsey,

Pierce, Fenner &

Beane, Kidder, Peabody

& Co. and White. Weld & Co.

(jointly); Harriman Rip¬

rill

Lynch,

United Gas Corp.

Hutzler; Harris, Hall & Co. (Inc.).

has
Co.

(26.95%) of
stock. In event of competitive
bidding, probable bidders may include Lehman Brothers.
dispose of its holdings of 2,870,653 shares

United Gas Corp. common

South Atlantic Gas Co.
11

Dec.

company

sought Georgia P. S. Commission for

United

authority to issue $3,000,000 new first mortgage bonds.
May be placed privately. The proceeds will be used to

privately, with no public offering expected for at least
E. Holley Poe and Paul Ryan, of 70 Pine St.,

New

York, N. Y.,
poration.

(jointly).

Natural

Utah

(Mich.)

first

announced that in connection with the fi¬

of 6%

Gas

Co.

to $32,000,000 (from $25,000,000 in the original
application), according to John A. McGuire, President,
and the length of the proposed transmission increased
creased

the company proposes to issue $3,300,000 of
bonds, $500,000 of 5% prior preferred

$200,000

the principal officers of the cor¬

21, the company applied to the Utah P. S. Commis¬
sion for permission to extend the proposed natural gas
line from northeastern Utah to include additional areas
in that State. The estimated cost of the project was in¬

mortgage

stock,

are

Nov.

nancing of the proposed pipeline, the acquisition of dis¬
tribution facilities and the conversion of the system to
natural gas,

had been

two years.

Gas Co. (154,231.8 shares, par $5 each.)
Probable bidders: Lehman Brothers and Bear, Stearns

was

(Del.)

build, own and operate a petroleum products
pipeline from the Texas Gulf Coast to St. Louis, Chicago
and other midwest markets to operate as a "common
carrier."
The initial financing has been arranged for

of South Jersey

1 it

Pipe Line Co.

formed to

South Jersey Gas Co ^

& Co.

States

Sept. 25, it was announced that this company

bank loans and for expansion program.

repay

cumulative preferred stock and

from 325 miles to 469 miles.

$400,000 of common stock, subject to the approval of the
Michigan P. S. Commission. The FPC authorized the
company to construct natural gas pipeline facilities to
serve the southeastern Michigan area.

Valley Gas Pipe Line Co., Inc., Houston, Tex.
sought FPC authorization to construct

June 27 company
a

$144,500,000 pipeline project to carry natural gas from
Gulf Coast and off-shore fields in Louisiana and

the
Southeastern
Nov.
&

Telephone

20 this company, a

Gas

Co., notified

Co.

Texas to markets in Indiana, Ohio

subsidiary of Central Electric

pany

$10).

Price—$11.25

Dec.

Proceeds—For construction and improvement

California

27, W. C.

Edison Co.

will have to raise $50,000,000 in new capital

program.

bonds.

new

Blyth

1951 construc¬

Total financing may involve $55,000,000
Probable bidders: Halsey, Stuart & Co.

Southern
Nov.

Co.,

Inc.;

The First Boston Corp. and

Indiana Gas &

of 30-

first mortgage bonds. Underwriters—May be deter¬
by competitive bidding.

Probable bidders: Hal¬

Co. Inc.; Kidder, Peabody & Co.; First
Equitable Securities Corp.; Otis & Co.;

Boston

Corp.;

Carl M.

Loeb, Rhoades & Co.; Salomon Bros. & Hutzler.

Proceeds—For expansion program.

Electric Co.

reported company plans to sell $7,000,000
common
stock, either to the stockholders or
was

underwriting.

If through

underwriters,

stock

be sold at straight competitive bidding. Probable
Lehman Brothers and Goldman, Sachs & Co.

(jointly); Morgan Stanley & Co.; W. C. Langley & Co.
The First Boston Corp. (jointly); Harriman Ripley
& Co. Inc. Proceeds—For expansion program. Offering
—Expected early in 1951.
and

Westcoast Transmission

Co.,

Ltd.

announced that Westcoast Transmission
Co., Inc., its American affiliate, has filed an application
with the FPC seeking authorization to construct approx¬

Nov.

10, it

was

natural gas

6, the company applied to the Indiana P. S. Com¬

Stuart &

Com¬

imately 615 miles of pipeline for the transportation of
in the States of Washington and Oregon (this

Electric Co.

mission for authority to issue and sell $3,000,000
year

and Michigan.

in process of completing negotiations for

bidders:

Mullendore, President, announced that

within the next 18 months to finance its

tion

new

may

company

through

program.

Southern

now

West Penn

share. Underwriter—Wagner, Reid & Ebinger, Louis¬

Sept.

its major financing requirements.

the SEC that it proposes to offer

10,000 shares of common stock (par

sey,

outstanding shares of United Elec¬

Rys.

mined

Edison Co.

Rys. Co.

Nov. 16, the Division of Public Utilities of the SEC
recommended that SEC order Electric Bond & Share

stockholders will vote Jan. 16

requirements, if necessary.

Electric

was

920,000 equipment trust certificates next month. Prob¬
able bidders: Halsey, Stuart & Co. Inc.; Salomon Bros. &

Harris, Hall & Co. (Inc.) (jointly); Shields & Co.

Co.

issue and

ley & Co. Inc. and Goldman, Sachs & Co. (jointly).

Inc.;

Brewing

plans to

company

$4,500,000 equipment trust cer¬

capital stock (par $100). Probable bidders:
Blyth & Co., Inc. and Lehman Brothers (jointly); Mer¬
tric

reported company plans issuance of $4,-

•

Pittsburgh

18 it

interest in the 82,507

expansion program.

struction program.

Dec. 12 it was announced

Ry.

announced

reported the New England Electric Sys¬
tem will receive bids Dec. 21 for the sale of its 99.143%

RR.

Line

United

•

Dec.

Inc.; Salomon Bros. &
(jointly); White,
Weld & Co. and Shields & Co. (jointly).
Proceeds—To
repay

Pacific

pected in January.

& Electric Co.

Blyth & Co.,

bidders:

&
was

tificates, series I, to be dated Feb. 1, 1951. Probable bid¬
ders: Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler;
Harris, Hall & Co. (Inc.); Lee Higginson Corp.; R. W.
Pressprich & Co.; Harriman Ripley & Co. Inc. and Leh¬
man
Brothers (jointly); Blair, Rollins & Co. Inc. Ex¬

Underwriters—To be determined by
Probable

sell either $3,800,000 or

additional shares of preferred stock (par $20).
competitive bidding.

325,000

about $34,900,000 of new capital over

next four years

Texas
Dec.

announced company plans to issue and sell

was

Traditional Underwriter—
Proceeds—For ex¬

pansion program.

would be reserved for future sale to

Gas

Diego

intends to

estimated $20,000,000 of equity securities

(probably preferred stock).

Engineering Co.

employees and for other corporate purposes.
underwriter: Hayden, Miller & Co.

Corp.

that the company

announced

Dillon, Read & Co. Inc., New York.

preemptive rights in 531,558 of the unissued new shares
while 50,000 shares

Transmission

Eastern
was

issue in 1951

Halsey,

call

Dec.

special meeting of stock¬
holders for Jan. 18, 1951, for purpose of increasing au¬
thorized
common
stock from 350,000 shares (209,221
shares outstanding) to 1,000,000 shares and to effect a
2-for-l stock split-up. The stockholders would then have

ville, Ky.

Oakes, President, stated the company

the
It is re¬
ported that not over 75,000 shares of series preferred
stock may be sold late this year or early 1951. Traditional

will require

plans issuance and sale

$8,000,000

Electric &

Reliance

per

Pennsylvania Power & Light Co.
Nov.

bidders:

Nov. 22 directors voted to

early next year of about $10,000,000 new bonds. Probable
bidders: Halsey, Stuart & Co. Inc.; Kidder, Peabody &

Loeb &

company

equipment trust certificates.
Stuart & Co. Inc.; Salomon
Hutzler; Harris, Hall & Co. (Inc.).

Bros.

Dec.

offer stockholders the right to

share for each 10 common

one

month

Texas

stated

was

Southeastern Michigan Gas Co.

and/or pre¬
Price —At par ($100 per share).
Parent—American Telephone & Telegraph Co. owns ap¬
on

Probable

Blyth & Co., Inc.

Telegraph Co.

Pacific Telephone &

•

Dec. 8 directors voted to

Nov. 20 an advisory report submitted to SEC provides
for sale of entire holdings of United Corp. in the stock

Pacific
Nov.

Dec.

Hutzler and the Union Securities Corp.

Sept. 28 a plan was filed with the SEC, which
in part, for the refunding of the outstanding
5y4% cumulative preferred stock (par $100)

equal

Reading Co.

project is estimated to cost $25,690,000). Both companies
are
sponsored by Pacific Petroleums, Ltd., of Calgary,
Sunray Oil Corp. and other members of the "Pacific
Group" engaged in active oil and gas exploration and
development in Western Canada. The completed line of
both companies, to be about 1,400 miles, will, according
to estimates, cost
about $175,000,000, to be financed
75% by bonds and the remainder by preferred and com¬
mon
stock.
Underwriters—Eastman, Dillon & Co. and
The First Boston Corp.

(2475)

Continued

from

has been

page

definite trend toward

Joins

reduction of such inventories with
two

major factors

stimulus.

the

higher

The Stock Market Outlook
Companies,

ance

Trust

Savings

Banks,
(prudent
men),
Retirement and

Officers

Pension

Funds,

Death

Benefit

These

present "big operators" do

not

trade

chases

Plans

and

Their

out.

salted

are

Unions.

and

pur¬

reducing

away,

the available supply of

high grade

The Benevolent Funds re¬

stocks.

ceive contributions from members
and

their

which

employers

enormous

dividends

derived

purchases,

their coffers
thereby creating

tinuously,

reinvestment

manent

also forming an

under
the

from

original

fill

the

con¬

and

important cushion
They all buy

market.
"blue

same

chips" comprised

in the Dow-Jones averages, hold¬

ing

the market at

tional

relatively

high level.

With

billion.

prosperity

na¬

$230

about

bil¬

outlook is for a

quent years, the
continuous

with the prospect post-

agree

World

New

War

III,

depicted in the

"Times"

York

1950,

June

"A World War III, if it lasted as

long

World War II, would cost
$525 billion, bringing the na¬

some

Prices might be permitted to soar
alternative to debit repudia¬

as an

tion

with

lar

readily

dollar

shares.

Roebuck,

the

outstanding

number

the

case

the
as

dollar,

means

are

effect,
making

The dol¬

could

become

the

times

Currently,
well

In periods of

inflation, the safest

is the

protection

holding of gold

best hedges are land, real estate,
participation
in
the
common

platinum.

the

this

General Business

of the

Outlook
Recent

sulphur, titanium uranium, molyb¬

production figures are
Prospects in the heavy

excellent.

owning gold, silver, aluminum, oil,
gas, iron ore, copper, zinc, lead,

industry are obvious due

to the

present and futuer armament pro¬

the "soft goods" indus¬
try has to remain on a high level
in view of full employment of

gram, even

denum, coal, etc.
erratic

factory wage level
of
$60.53 and a continuously growing

due

work out

profitably
longer period of time.
In

conclusion,

the market
not

seems

tend

week's

at the age.of 65.

In the

past he had been associated
Hayden, Stone & Co.

with

With Waddell & Reed
(Special to The Financial Chronicle)

BEVERLY

99.64 for

man

Lombard and

Thomas D.

Rike have joined the staff of Wad-

dell

Reed,

Inc.,

8943

brought

out

adding

way

cheer,

seasonal

reports
indicated that the Western Pacific

mite

Railroad's

$22,000,000

issue

bond

encountered brisk demand from

institutional
.

But
and

sources.

few

sizable

operation

(Special to The Financial Chronicle)

liam

ANGELES,

Calif. —Wil¬

Coleman has

been

added

to the staff of Morgan &

Co., 634
Spring Street, members of
the Los Angeles Stock Exchange.

writing fraternity has settled back
in its chairs to wait for the turn
into the New Year.

Except for

few small munici¬

pal undertakings that are known
to be in the works and likely to
reach market before the

there
way

The

year-end,

in sight in the
issues for next week.
corporate calendar is clean.,
of

nothing

new

months and

the last twelve
commenting on what

transpired,

one

pleased

note

fellows

are

Looking

over

bond

was

man

that "the stock
eating three meals

again."
But he remarked

had

been

least.

That

added,

not

that the

average

business,

bond

was

spotty

was

the

house
in

year

Herman E. Scheer
Hermani E. Scheer, member of
the

New

Stock

York

Exchange

11.

passed away on Dec.

DIVIDEND NOTICES

part

operations

ad¬

visory capacity.
For

houses

distribution of

engaged in
new

straight

securities, this

observer said, things were not too

good.

tinued, is a
negotiated
spread

is needed, he con¬
greater proportion of
operations where the

What

such

that

there

Pol¬

States—Edward L.
mons-Boardman

sponsoring

201 st Consecutive

Accumulated Surplus of the Company a

year-end dividend for the
dollar

one

($1.00)

year

per

1950 of
on

the

than

business

December

MANUFACTURING

AMERICAN

and

West

22,

Brooklyn

The Board of Directors

COMPANY

20,

price

tag

stock.

able

was

minutes

oversub¬

Municipals Working Off
its

bearing

prospects has

been helping municipal dealers to
whittle down their shelf stocks of

ily in the fall period and at the
reached

level

Capital

1951

stockholders of record

the close of business December

weeks, however, there

(30(f) per share
paid January 15, 1951 on the Common
Stock of the Corporation, to stock¬
of

holders

record

December 29,

the

business

1950.

Joseph F. Martin,
Secretary and Treasurer
December

15, 1950.

PACIFIC

CANADIAN

26,

1950.

RAILWAY COMPANY
Edward

J. Costeli.o,
Tr/>n

Dividend Notice

cr/r/"-

meeting

the

Directors held today

Board

the following

declared:—

were

final
year

February 1, 1951,

December 29,

Rfl YOniGR
Ulli

DIVIDEND

dend

(25(0

extra divi¬

twenty-five cents

Per

Common
the

CONVERTIBLE

share on the
and i also

Stock,

regular quarterly divi¬
of

(50(0
per share on the Common
Stock, each payable Febru¬
ary 15,1951 to stockholders
of

fifty cents

record

the

SERIES

NO. 11

1951.

R. L. LINGELBACH

Secretary

cents

per

has

the

Stock;
per

vertible Series;

28!/2

share on the
Stock, 4.56% Con¬

cents per

Preference

vertible Series.
are

pay¬

able January 31, 1951, to stock¬
holders of record January 5,

Checks will be mailed

from the Company's office in
Los Angeles, January 31,1951.
p. c.

stock

over

attributable

railway

and one per cent to
income from other sources.
The interim dividend declared
in August last was
from

attributable to
other

sources

hale,

December 15, 1950

Treasurer

from
In

operations

each
recent

and

source.

years

the declaration

made
year

until

after

which

the

been

close of the

dividend ap¬

In future, so far as may be
possible, an announcement in re--*

plied.

spect of

final dividend will be
close of the year.

made before the

By order of the Board,.
FREDERICK BRAMLJSY,
Secretary.

December 12, 1950

than

the total
dividend for the year is thus at
the rate of six per cent, one half
railway

of the final dividend has not

The above dividends

1951.

that net

operations

income

share on the
Preference Stock, 4.48% Con¬
cents

December 29, 1950.

continue to show im¬
last year; three
per cent of the dividend declared
today on the Ordinary Capital

of the
following quarterly dividends:
50

1950, payable in Ca¬
on February 28,1951,

The Direciors point out

provement

The Board of Directors

Common

in respect

share)

per

year

nadian funds

for the year

STOCK

authorized the payment

Board of Directors

the

earnings from railway operations
SERIES

Np. 15

PREFERENCE

DIVIDEND

The

NO. 164

STOCK

CONVERTIBLE

DIVIDEND
'

dividend of four per cent

(one dollar
of

to shareholders of record at 3 p.m.

DIVIDEND

PREFERENCE
4.48%

1950.
Ordinary Capital stock,

the

final

COMMON

4.56%

EXTRA and REGULAR

Company

HIGHLY

PURIFIED

has declared

California

dividends

PRODUCER

some

$260,000,000.
In recent

Treasurer.

A dividend of Thirty-cents
will be

mid-November

record

BACH,

to stockholders of record at 3 p.m.

These had mounted rather heav¬

about

Corporation

1950, payable

business January 19,

unsold issues.

peak,

of
record of
such
business
on
December

of, and from earnings for, the

dend

and

holders

dividend of two per cent in respect

the

also marketed as a second¬
was sold out quickly.

market

On the Preference stock, a

open

shares of Honolulu Oil Corp. com¬

the

STATIONERY

1950.

dividends

after

scription apd immediate closing.
Similarly, a block of 110,000

The trend of events

KEMP, Treasurer.

Dividend No. 19

putting

TABLET

Corporation held on
December 14, 1950, a dividend of
$2.50 per share on the outstanding
Capital Stock and a dividend like¬
wise of $2.50 per share on the out¬
standing Class A Capital Stock
were declared
payable January 9,

Edison

shortly

announce

28,

of The First Boston

WOOD

matter

1950.

hereby given that

regular meeting of

Philadelphia 32, December 8, 1930.

With

payable

record

19,

CELLULOSE

are

December

1950. Transfer books will remain open.

Secretary and Treasurer

sooner

$32

uary
15,
1951,
shares
at the

of the American Man¬

ufacturing Company has declared the regular
quarterly dividend of 25c per share and a yearend dividend of 50c per share on the Common
Stock, payable December 31, 1950 to Stockhold¬
ers of Record at the close of business December

out

100.485

Tuesday,

stock

stockholders

a dividend at the
$.50 per share on the issued and out¬
standing shares without par value of the Com¬
mon
Stock
of
Western
Tablet
&
Stationery
Corporation has been declared payable on Jan¬

York

they

expected, proceeded to
on

Common

business

CORPORATION

H. C. ALLAN,

getting

midday

and

1951,
of

WESTERN

Streets

New

15,

group,

books

WALLACE M.

rate

1950. Checks will be mailed.

clearance

subscription

the

DIVIDEND NOTICES

Southern

necessary

this

capital

Preferred

January

the Board of Directors

Macy & Co., Inc., common
stock brought out this week:/:»
•;
The

dividend

Preferred

both

Co.,
York 7,

New

Street,
N. Y.—$2.50.

Directors

Corporation have de¬
37^ cents per share on
stock.
They have also
declared a dividend of 62y2 cents per share on
the Common
capital stock.
The dividends on

Ullman—Sim-

Church

the

The

clared

Wichita River Oil

moved

Shoe Machinery
Corporation

Publishing

$5,000,000

bonds

United

Associa¬

Boston, Mass., Dec. 14,1950

secondary offerings
have
moved
out
with
greater
celerity than the 117,692 shares of

question

National

Planning

the situation.

in for

the

reoffering

DIVIDEND NOTICES

COLUMBUS MOISE, Treasurer.

price of

he
the

Con¬

the

Few recent

ary,

Defense

U. S. Railroad Map of the United

Fast Secondary

the

some

Committee

ness

Noble

yield 3.10%.

say
so,

Renegotiation of

tracts—Special report of the Busi¬

1950, to stockholders of record at the

mon,

year's private placements, or had
no

came

and
on

the

especially

involved

block

one

rected to Mr. Larmon.

At any rate, one large insurance
company

Waddell & Reed Add
(Special to The Financial Chronicle)

Notice

Common Stock, payable December 21,

evidently

underestimated

under¬

the

proportions,

but

Reed, Inc., 408 Olive Street.

South

secondaries

quick

had

well

that

from

aside

people,

some

Mo. — William E.
affiliated with Wad¬

now

ciate, Thomas W. Lapham—Paper
KANSAS CITY, Mo.—Mary M.
—Single copy 25c; quantity prices Cater is now with Waddell &
on
request; orders should be di-„ Reed, Inc., 1012 Baltimore Ave.

Morgan & Co. Add

suc¬

The

being 98.829, also for 3X/8S.
The
bidding was a little "rich" for

dell &

tion, 800 Twenty-first Street," N.
W., Washington 6, D. C.—Paper.

Quarterly Dividend

The runner-up bid, 99.55999, for
the same rate with the lowest bid

Perhaps

LOUIS,

Byron is

Con¬

—

Larmon, President of Young &
Rubicam, Inc., 285 Madison Ave.,
New York 17, N. Y., and his asso¬

Wilshire icy—National

Boulevard.

3x/8% coupon.

Americans

for

(Special to The Financial Chronicle)

ST.

ceived and developed by Sigurd S.

HILLS, Calif.—Nor¬

The Directors have declared from the

Tuesday.
syndicate paid

break

sought Western

With Waddell & Reed

Hall, Inc., 70 Fifth
Avenue, New York 11, N. Y.—
Cloth—$12.50.

Buy and

Pacific's 30-year first and refund¬
bids

—Prentice

Doris

Western Pacific

cessful

of Georgia.

Con¬

Handbook—Lillian

•

reasonable profit in promoting

for

trollers

Primer

Philip Boyer died at his winter

sales.

ing mortgage bonds

Corporate Treasurers and

are

The Electric Storage Battery

groups

Ga. — Edward A.
Hightower is with the Trust Com¬
pany

stocks

$190,000,000,

'"'company

Four

ATLANTA,

the

over

every

to be

(Special to The Financial Chronicle)

will

war

Sale.

the

home in Florida

news, purchases of equities repre¬
senting ownership in the natural
resources of our
country ^should

62,000,000 people with an average
weekly

Irrespective of

fluctuations

With Trust Co. of Ga.

of
the

Philip Boyer

stocks of companies controlling or

Review

also

needs

dealers'

under

LOS

approximately five million shares,
21% of the outstanding capital
f

type

level.

World

and

stock.

tax-

emissions

new

defense

this

estimated just above

9-cent

after

participating shareholders, owning
or

there

ley, Hicks & Co., Cooper Building.

the

curtail work financed thereby.

less than 60
purchasing power,

War III."

Sears-

employees

102,547

shrink

today, worth

pate in the ownership and profits

ing

prospect that

tional debt to $600 billion or more.

cents in prewar

business, gradually reduc¬

follows:

allow

the

And

DENVER,
Colo. — Charles
B.
Case has joined the staff of Shel¬

which

taxation

worth

feature

security.

ity prices and income.

devalued

employees to partici¬

the

still

for

between commod¬

race

the debt burden lighter.

their

almost

seems

guaranteed for 1951; and in subse¬

point of consideration
is the fact that many companies

Another

figure

astounding

income

lion,

per¬

funds

the

around

regularly,

with

together

corporation income will still

show

Federal

exempt

Taxes will be higher,

population.
but

adds

prospect

Shelley, Hicks

(Special to The Financial Chronicle)

the

First

'Democracy, Inflation, and

providing

Montreal, December 11,

1950.

The Commercial and

,44

Financial CYaonicle... Thursday, December 21, 1950

(2476)
reporters

discussions from which

BUSINESS BUZZ

were

barred.

Nevertheless, the Banking Com¬
reject the
To do so would have

mittee did not officially

Washington
Behind-the-Scene Interpretations
■'

from the Nation'*

Capital

nominees.

public hearings. Public
were something which,
the Committee
apparently did not want, together
with resulting official debate in

required
hearings

JL f-r

t/%A/

wartime,

during

V/M#

/■
xJL m

•

Senate

the

adverse

formal

report on the nominees.
Earlier in the 81st Congress the
C.—With a
House also passed a similar ver¬
stroke of the pen, President Tru¬
sion of the bill, with many con¬
man effected the greatest revolu¬
servatives believing it would die
tion in power achieved in peace
a
"natural death"
in a Senate
time when he elevated Charles E.
Committee pigeon-hole.
Wilson to supreme boss of the war
With
war
production altering
mobilization program and sent W.
Stuart Symington into the out¬ the whole face of the economy,
the demand of officials is likely
field of government control.
to be directed toward a general
James
F.
Byrnes
and others
waiver of the anti-trust laws to
never
quite approached at any
time the power given to Mr. Wil¬ get things produced as quickly
and as cheaply as possible. If the
son, a conservative businessman.
Celler-Kefauver
bill hurdles
a
Others had the power to "coordi¬
conference between the House and
nate" various agencies, with an
Senate in time to be enacted this
implied power to take some ini¬
month, then it will become law
tiative.
and will constitute another stumb¬
Mr. Truman, however, invoked
ling block to the quick mobiliza¬
all his residual powers under the
tion of industry for war produc¬
Constitution, and as Commandertion.
;■
in-Chief of the Armed Forces, and
That the law might have to be
the Defense Production Act, put
waived for the duration is some¬
them all into one package, and
thing, however, which worries the
thereby created the Office of De¬
left-wingers not one whit. They
fense Mobilization. Its Director,
are
long-range in their planning,
"on behalf of the President" shall

Just

WASHINGTON, D.

...

direct, control, and

coordinate all

mobilization activities of the Ex¬

government.

ecutive branch of the

Specifically, he has express au¬
thority over production, procure¬
ment (thereby having a hand over
the Service departments), man¬

thus

power
(and
stabilization,

Labor)

over

transportation

and

activities.

believed

precedent for such a grant of au¬
thority in all U. S. history. How¬
ever, "what God hath given, God
can
taketh away," is applicable
here

figure of speech. Sym¬

ington until last Saturday was the

biggest
now

next to the President;
is a subordinate of Mr.

man

Wilson.
-

every
ness

;

...

explanation

power,

the
of

Senate

the

ing will have to be constructed in
"defense areas," or particularly in
areas where war production zooms
and

is not adequate for the im¬
ported labor force.
The first step will be the re¬
activation of the old wartime and

postwar Federal Housing Admin¬
istration "Title VI" under which,
in effect,

tenacity was
only Monday

switchmen's

and
membership
employment for the railroads.
compel the dues check-off

This bill is

specific and direct
the
Railway

from

Act, which, on the one hand,
prohibited railroads from influ¬
encing their employees on the

Labor

question of union membership,
and, on the other hand, prohibited
railroads from refusing an indi¬

by the government,
multi-family units.

should

underwritten
in case of
of

hundreds

come

Federal hous¬

for direct

permanent, in

ing, temporary and

you'd be happy to know
credit is so good!"

think

your

defense areas.

relaxation

will come the

Third

Regulation X, so as to permit
financing of individual houses at
cost with a government guarantee.
Among other things, they would the entire Banking Committee has
Regulation X eventually
will
"improve the financing" of UC by twice turned down Mr. Truman's
a
system of "re-insurance."
In slate of nominees, and twice with¬ disappear into an era of govern¬
ment-financed housing, BUT hous¬
other words, they would provide out any formal action or explana¬
ing for individuals as such, except
that Uncle Sam's general taxpay¬ tion of its reasons therefore.
where it is "necessary to defense,"
ers should bail out state systems.
In September, the subcommit¬
will be
held down.
Eventually
Then, too, states would be re¬
tee held several super-secret meet¬
materials regulation will join with
quired to adopt new "minimum
ings to discuss the qualifications credit regulations to make sure
compensation" provisions, to the of Mr. Truman's nominees. After
that very little housing is built
effect of which would be to stand¬
these secret meetings, the Com¬
except when and where the gov¬
ardize the proposition on a Fed¬
mittee decided to bury the nomi¬
ernment says it is necessary.
eral level. Ultimate federalization
nations.
It was widely reported
of UC
is probably the real but
and not challenged afterward that
(This column is intended to re'
unadmitted objective of the leftthe Administration was given the fleet the "behind the scene" inter¬
wingers.
word that the Committee did not pretation from the nation's Capital
it
^
*
want these men named a second and may or may not coincide with
Something of a major precedent time.
the "Chronicle's" own viewsJ
of

<5m*tmgs (La Alt

WONDERFUL
Teletype—NY 1-971

will

millions

Leftwing elements have given vidual employment because he did
convincing demonstrations since not belong to a union. A proposed
convening of the lame duck Con¬ amendment to preserve the provi¬
gress that they keep their eyes sions of state laws, and even state
constantly on the ball of left-wing constitutional provisions against
was established
when the Senate
legislation no matter how much compulsory
Meanwhile, the Congress re¬
union
membership, Banking subcommittee on the
the country, Congress, or the Ad¬ was
cessed for the election.
With an
specifically voted down.
Reconstruction Finance Corpora¬
ministration is preoccupied with
It is the view of competent ob¬ tion refused, but without formal opinion from the Attorney General
grave turns in the war or threats
that the period between the Sep¬
servers
that this bill would not public
announcement,
to
take
of new wars.
tember recess and Nov. 27 was the
have come up if the attention of "any action" on President Tru¬
same as an adjournment between
One of the most convincing of
nearly every one was not directed man's five nominees for the RFC
two
these
demonstrations
was
the to
sessions, the White House
tjie grave events of the war. Board.
gave "recess appointments" to the
passage a week ago, almost un¬ The House has not passed this
In effect, this is the second time
three of the five on the Board
noticed, of the Celler-Kefauver
legislation, will not pass it this in one year that the appropriate
who
were
new
nominees.
The
bill.
This bill has been one of
year.
committee has simply refused to
the prime legislative projects of
original idea was to avoid resub¬
The third item on the "liberal confirm an entire slate of direc¬
"liberals"
for
the
last
several
mission of the names of the mem¬
agenda" is the expansion of un¬ tors for a major government cor¬ bers of the Board for confirma¬
;years, and its passage was entirely
employment.
compensation. !
A poration. When the five members tion
unexpected up until a few days
prior to the 82nd Congress.
Ways and Means subcommittee were first nominated in August,
before the Senate, tired, preoccu¬
Subsequently, the White House
headed by Rep. Aime J. Forand
the
Senate
Banking Committee
pied, worried, and hardly know¬
changed its mind and resubmitted
(D., R. I.) has been conducting
ing what it was doing, approved
also
"took
no
action"
on
the the nominations. It is the second
hearings on this subject with the
this bill.
time they were submitted, and the
brutally frank understanding that nominations.
Under the Celler-Kefauver bill
thev have no chance of getting
Avoiding the complications of second time the nominees were in
the acquisition by one company of
legislation passed during the lame
the assets of another may be pro¬
procedure, the precise fact is that effect rejected, again after private
duck session. Their idea, frankly,
hibited
by
the Federal Trade is to
promote the build-up of the
Commission. Under present law,
project for 1951 if possible, or if
the acquisition of formal equity
not
then, the first time in the
control of one company by another
decade they can get somewhere.
may be banned by the FTC, al¬
,The ambitions of the Adminis¬
ways crying for new worlds
to
conquer, whenever the acquisition tration and the left-wing for "ex¬
threatens "to substantially lessen pansion," as it is called, of unem¬
YOU
ployment compensation, are broad.
competition."

HAnover 2-0050

the entire cost of defense

housing is insured or

absenteeism," of the bill

turn-around

employment, and hence hous¬

ing

virtually 100% union
in

proposed relaxation of Reg¬

the control over home
credit, is coming as a
result of a recognition by Presi¬
dential aides that additional hous¬

approved by

the

commit¬

investigative
operating.

mortgage

remarkable ex¬

passage,

week

character, is
if ever, will

ulation X,

government officials.
One of the more

any

The

conceivable form of busi¬
must be filtered

amples of left-wing

tee starts

the day when

through and first be

which,

probably not be reported until in
some
future
change
in
party

expansion

"sickness

There

and look forward to

taken without official

was

something

unprecedented

this

why

action

With Bache & Co.
(Special to The Financial

Chronicle)

MILWAUKEE, Wis. —Paul D.
Brown is with Bache & Co., 229
East

Wisconsin Avenue.

For

Large Appreciation

Potential

SUGGEST

RIVERSIDE CEMENT CO.
(common) STOCK

CLASS B
A

leading

producer of

fast-growing

cement

Southern

California.

Analysis of this Company
-

review of

try

and

the Cement Indus¬

available on request.

Selling about

$10.25

LERNER & CO.
Investment

Securities

10 Post Office Square,

Boston 9, Mass.

Tel. HUbbard 2-1990

Allied Electric Products

PEOPLE

Garlock Packing

Firm Trading Markets

^3S^SI«^3^3^^!^5^J!KJ!KE3!!aS!S5.'8SSSaSSiS»S3aSS«5SSES3!S3!3SEEiaaSS!;

FOREIGN SECURITIES

3Vlmy Chvistmas—

All Issues

itappy Jlcxu llcac

HAUL MARKS 4 P.O. teg

50 Broad Street
————————————

Jessop Steel
McBee

Company

i Telephone

FOREIGN SECURITIES
SPECIALISTS

Gisholt Machine Co.

New York 4, N. Y,
;

^jjr WHitehall
| 3-6816

| GO II. FT & CO.
Investment Securities

25 BROAD STREET, NEW YORK 4

Hili, Thompson & Co., Inc.

« Teletype
oaac

-.yV 1

Trading

Department

70 WALL STREET,

N. Y. 5

Tel. WHitehall 4-4S40'

Full text of Commercial and Financial Chronicle : December 21, 1950, Vol. 172, No. 4970

FRASER