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A Hirtorioua mti)
Final
Edition
prospermia -jXunu Jfmr
:
in 2 Sections-Section
■
1
omm
Reg, U.
Volume
Number 4346
160
New York, N.
S.
Pat.
Office
Y., Thursday, December 28, 1944
Brennen Elected Railroad Stocks Should
By Mfrs. Trust Co.
John H; Brennen, affiliated with
the
Out-of-Town
Manufacturers
New
York, and
Secretary
ant
the
of
h
Department
Trust
of
Company,
formerly
Assist¬
/'
•
Bank,
elected
an
Assistant,
Vice - Presi¬
A
banking
;
f i
be¬
ing
t h
Cen¬
Came
:
J.
H. Brennen
During the greater
eleven years he
has represented the bank in New
York State,. New Hampshire and
retary in 1941.
part of the past
Mr. Brennen
u-
ingly
He is
has been exceed¬
active in banking circles.
past Vice-President of the
of the Ameri¬
Institute
of Banking
and
a
New York Chapter
can
served
as
on
well
as
to
pick
-
and
Is
a
it
By''HERBERT'M. BRATTER
He has also been active
Regular
2832.
Features
-.".v-'c■
,
That at the End of
them "
selling
1
address
by- Mr. McGinn is
,
in Boston.. Dec.
12, 1944, Mr. Mc-
on page
export policy, looms strikingly
was much big¬
of
argument
.
64 Wall
Street, New York 5
BOSTON
'
<
PHILADELPHIA
Albany
Buffalo
Pittsburgh
Wiliiamsport
Troy
.
.
Actual
BOND
-
Trading
Syracuse
Dallas ;
Markets,
.
'
LONG
W.
Bond
Brokerage
Bonds
for Banks, Brokers
Bond Department
.NEW YORK
5
;
.
'
and
COMPANY
Members New York Stock Exchange
York Curb Exchange
Members New
634 SO." SPRING ST.
LOS ANGELES
;
THE CHASE
Hardy & Co.
INCORPORATED
■
WALL STREET
alway
14
30
Broad St.
NATIONAL BANK
New York 4
Tel. DIgby 4-7800
Tele. NY
OF
Philip Carey
;
Detrola
industrials
CITY OF
NEW YORK
New England
Public Service Co.
International
■
THE
1-733
Manufacturing Co.
electronics
rails
BROKERS
prospectus on Request
;;
**
4d
Cleveland
State and
Service
-
.
already be2811)
on page
Municipal
NEW YORK STOCKS, INC
HUGH
York 4, N.Y.
Teletype NY 1-210
•
(Continued
and Dealers
Established 1927
•Chleago
2. War production is
R. H. Johnson & Co.
INVESTMENT SECURITIES
Babson
already
.
Rep.
W.
Roger
the
of
.
has
Hirsch, Lilienthal & Co.
HAnover 2-0fi00
most
Herbert M. Bratter
become
quite familiar.
For example, Harry Hopkins,
presidential confidant, former Secretary of Commerce, and earlier
(Continued on page 2818)
line
VICTORY
25 Broad St., New
Canaoian
countries.
for
Exchange
and other Exchanges
in
States
following comments apply to both
The
2820)
Buy War Bonds
Members New York Stock
than
both
thermore,
At the outset it
making of American policy.
partner in Pflugfelder,
(Continued
new
the horizon.
than a man's hand. And it has been growing.
a New Deal philosophy for making jobs. Per¬
haps it might be called the New Deal for post¬
war;
Its philosophers have ready access to the
White House with all that that implies in the
New York Stock Exchange.
London- Geneva
10%
a
of
It is
on
Request
1945
show
ger
Bampton & Rust, members of the
on
it
197.
and
over
the country progressed
a
day
more
Per Cent of
a
to¬
regis¬
ago;
year
United
NEP, the
\
low-priced securi¬
'
*An
206.9
tered
ters
Busi¬
regis¬
business. Fur-
ties.
as
f
ness
reduction
Holdings of Foreign Dollar Bonds Were Partly
Completely in Default.
Patrick B. McGinni*
real
no
Vol¬
of
ume
will
the
1/3 Per Cent and
1949 Some 31
>
the
of
Physical
or
:
market for the
Ginnis is
Circular
.
Our
high prices,
yet there
was
Issues Are Eliminated
Net Return Was Only About 1
bonds that
were
When Canadian
That
to
interest
Aircraft & Eng. Co.
;■,
a
The
Canadian
Babsonehart
Mr. Bratter Discusses the Proposed Policy of Enlarging Our Exports
by Placing Capital Loans and Investments Abroad.
Analyzes the Commerce Department's Figures Re¬
garding Our Experience With Foreign Long Term
Investments After World War I, and Concludes
and
period of
1
•
my
of
year ago.
Index
was
difficult
in
Export Policy
Reviewing ,ihe Administration's Attitude Toward Foreign Investment,
was
Then,
page
the
ago
year
^justifying
NEP: The New
on
market
at
of
General Business
United States Babsonehart Index of the
Physical Volume of Business registered 148.6; today it registers 138,,
1. A
forecast
the
lowest
priced
securities; be¬
cause our only
Chairman of its Public
(Continued on page 2827)
Index
Expects Drop in Retail Trader Electric Output and Rail Volume.
any
its Board of Governors
Affairs Committee for a
ten years.
Half.
•/
.
<*>-
buyer
Individu
v
,
d
rail-*'
.) securi- ;
Ties,; we had;,
elected an Assistant. Sec¬
Vermont.
Corresponding
a
Holds That Rail¬
J ,'
road
1933
in
a n
a-
for
Comr
was
r ee
find
to Man-
pany
and
/•- ;/•
ago, when you' )■
could
'hardly,
facturers
u
Calls Attention to. Heavy Debt Reductions of
one-half years
Bank,- ' N e w
York City. He
Trust
-
Farmers' Cash
Approximate That of 1944, Which Was $20 Billions. Both
Bituminous and Anthracite Mining Will Run 5% Below a Year Ago.
Petroleum Output Will Be Upped 5%. Iron and Steel Will Decline
10%. A Similar Drop Is in Prospect for Chemical Manufactures. Lum¬
ber Output Will Increase 5%. The Paper and Shoe Industries Will Run
Along on the Same Levels as During 1944. Industrial Employment Will
Be 7% Less and Factory Pay Rolls Will Decline 10%. Greatest Single
Expansion Will Come in the Construction and Building Group, Which
Will Show, an Increase of 25% From the Low Levels of 1944's First
The. last five times I have talked to this audience, I have talked
.about various phases of the railroad securities: market.- Three or
National
tral
ices
Transportation Facility,
Prices.
with the
1900
Citizens
Copy
Income Will
Any Different Fluctuations in Earnings Than Other Groups. Predicts
as a Consequence of Higher Dividend Payments
and Considers Reorganized Railroad Income Bonds on Way to Higher
his bank¬
career in.
gan
Mr. Babson Looks for These Developments in 1945:
of Railroad Securities and Con¬
Increased Competition From Other Transport Serv¬
Railroads Have Maintained Their Position As Nation's; Leading
Rise in Railroad Stocks
.
Mr.
1 d,
e
Brennen
Railroad Analyst Reviews the Progress
tends That Despite
to
veteran
in the
a
By ROGER W. BABSON
road Bonds Still Afford Higher Income Yields Than Similar Issues of
Industrials and Utilities and Notes That Railroads Are Not Subject
dent.
Cents
For 1945
By PATRICK B. McGINNIS*
Rise in the Market Value and. Yield of Their Bonds.
«
60
Business and Financial Outlook
Follow Railroad Bonds
Roth Solvent and Insolvent Railroad Companies and
been
as
Price
Corp.
PREFERREDS
Electrolux
Kobbe, Gearh art & Go.
BULL, HOLDEN & C2
MEMBERS NEW
INCORPORATED
YOR£ STOCK-EXCHANGE
Members N.
14 wall St.,
new York 5. n.Y.
telephone-rector 2-6300
*
Y,
Members New York Stock Exchange'
Security Dealers Ass'n
45 Nassau Street
,
Tel. REctor 2-3600
Philadelphia
HART
Reynolds & Co.
New York 5
Teletype N. Y. 1-576
Telephone:
,
Enterprise 6015
120
Broadway, New York 5, N. Y.
Telephone:
Ro]1
REctor
Tpletvpe
2-7400
NY' 1-635
r
New
York
$MITH & CO.
Members
Security
52 WILLIAM ST.,
Bell
JTew- York
N. Y. 5
Dealers
Assn.
HAnover 2-0980
Teletype NY 1-395
Montreal
»
Toronto
IRA HAUPT & CO.
Members
of
Principal Exchanges
111 Broadway, N.
REctor 2-3100
Y. 6
Teletype NY 11920
V^'v
S." -t
FINANCIAL CHRONICLE
-THE COMMERCIAL &
2802
Thursday, December 28, 1944
Trading Markets in:
Lanova
FUNDS for
We Maintain Active Markets in U. S.
Corp.
CYANAMID
CANADIAN UTILITIES T
Com. & Pfd.
Canadian (j^curities Dep't.
KING & KING
Bought—Sold—Quoted
MC PONNELL & To.
York
Ass'n
40
Dealers,
Securities
and Other Principal Exchanges
.
V
NEW YORK 6, N. Y.
115 BROADWAY
Telephone BArclay 7-0100
"7
Exchange
—
* Analysis
Request
on
BROADWAY, NEW
Tel.
REctor
YORK
Members New York Stock Excnange
2-7815
25 Broad
NY 1-423
St., New York 4, N. Y.
HAnover 2-0700
Broadmoor Corp.
Expressions
On Peacetime Training
Moines & Sou.
Ft. Dodge, Des
4's,
Common
&
'91
7's
Interstate Coal,
Superior Elev, & Fwdg., 6's, '51
Washington Prop., 7's, '52 & Slk.
Wilbur Suchard Chocolate
4's, '52 & Stock
Exchange
Baltimore Stock
Members
120 Broadway,
N. Y. 5
WOrth 2-4230
Bell
1-1227
Y.
N.
Teletype
3/6s, 1956
Exchange
Y. Curb
N,
on
Eastern
institution.
New York 5
31 Nassau Street
Telephone
Bell
System
Reo
COrtlandt 1-4010
Teletype NY 1-1548
Company
Lansing, Mich.
Motors, Inc.;
We have read with considerable
"Chronicle
CHICAGO, ILL.
Faroll
—
of
Central States Elec.
,
and
Stock
Chicago
will:"'admit
Thomas
Harry
Oct.
Lough to partnership
in their firm on January 4th. Both
\
*
/
'
.
r
which
p p a
C
NY
Teletype
| Chairman, Securities and Exchange .Commission
a
3-1223
Reeves
Engineering
Old
Common
Preferred
Old
&
United Piece Dye Works
Common
&
&reeue™A
emu
du.
Members
St., N. Y. 5
Teletypes—NY
37 Wall
Bell
with
J
V;
of the
of
of
an
we
would
if
Hanover 2-4850
11126 & 1121
some
extend
of
means
ployment at the close of the
Common
Illinois Power
on page
2814)
—
feld
utility
in
nature
ices
of ad¬
Ganson Purcell
serv¬
the
,to
various
eral
.
the
;
$
-
are
Raiio Current
we
minister
...
Assets
to Cur¬
ad¬
were
designed for the protection of the
f
7
Request
on
F. H. Holler & Co., inc.
Members N.
7
Y.
Security Dealers Ass'n
111 Broadway, New York 6, N. Y.
BArclay 7-0570
NY 1-1026
those under
the other statutes entrusted to our
administration.
,
Holding
The
Company Act makes us a sort
Macfadden
of
Publications, Inc.
Debenture 6's, '68
late the various activities of hold¬
companies
ing
and
$1.50 Pfd. & Com.
their subsid¬
iaries,
including not only the
issuance and sale of securit.es but
t s...
the' laws
that
for
$1.50
7".".77;,.7
however, some¬
-Fed¬
c o u r
Dividends
Analysis
r,1-'"*1:
different from
what
-
Which
visory
All
(Continued
enter
Act,.
war.
of
par)
Company established 1926
rent Liabilities 6 to 1
service commission
for
Chap-: 1 public
ter X of the
holding and operating companies
the
electric and
gas
utility
N a t i o n.a l in
Under that, Act we regu¬
Bankru p tcy fields.
em¬
opponents and proponents
compulsory training seem to
find the greatest source of support
Power & Light
Black Hills
5
Rayon Co.
past five years
under
The
'
:
busi¬
our
prises
not found to
were
field of economic
finan¬
include duties
acute surplus of produc¬
our
Delaware
•
public and investors. The powers
that we
exercise in. the public
activities
ness
faced
be
the
cial
Chicago.
tive ability in the post-war period
Y, Security Dealers Assn.
N.
having to do
with
certain
of Dr.
.<»
"
•'
7 •
the age
vancements
YORK
Class A Stock ($15
The Securities and Exchange Commission has been in operation
little more than ten years and now administers six statutes
of 21. It was pointed
out that due to technological ad¬
to
Exchange
NEW
HAnover 2-9470
Predicts Improvement Under New
a
other than ordinary school¬
ing would have to be devised to
extend the period of youth training
Pfd.
U. S. Finishing,
York Curb
1-1140
>
Properly Be Furnished to Operating Utilities
Service Companies.
gram
Preferred
New
ST.
Produces Viscose Rayon Yarn
According to the statistical data
compiled at that school, there was
a feeling that some
definite pro¬
Shovel, Pfd.
Steam
Bowers
••
Annual
for
di¬
University
Earl
Long Island Lighting
Exchange
?
•
College
rection
WALL
Financial Structures of Market Values of Public Service Corporations
at
the
•
•
Michigan
1-1843
'r
and Though Con¬
by Outside
recent forum
conducted
under
Marion
>
Progress in Carrying Out the Provisions of
Company Act, Asserting Aim Has Been to Develop
Technical Services May
brought out in
State
Aetna Standard
purcell*
By ganson
•
yet which was
Street, New York 5
Bell
■
Integration of Holding Company Systems Is in Sight
rently
considered,
ti. G. BRUHS & CO.
York Curb
New
on
'..
demning Controlled "Service Companies" That Impose Charges on
Affiliated Utilities in Excess of Cost, He States That Engineering and
has
writers
'/;•
Teletype NY
Compact and Efficient Operating Systems With Conservative Corporate
and Financial Structures.
Holds That the Completion of the Job of
fac-;
a
in
Members
64
It
26.
Dealt
''
Frank C.Masterson & Co.
Public Utility Holding
a
;
Nat. Commercial Title &
the Public
The Enforcement
neither of the
Preferred
"77'.,'.-''
.
ation to
Struthers Wells
Preferreds
&
Reiter-Foster Oil
associated with Faroll
been
have
(Va.)
Debentures
& 5l/2 %
Common
F.
SEC Executive Review* the
tor
7*5%
7
Exchanges
Davis
and
give consider¬
Preferred
Telephone: WHitehall
1-1919
&
Company,
208
South
La Salle
Street, members of the New York
might be in¬
teresting to
Shoe
6s, 1952
20 Pine
WHitehall 4-8120
System Teletype NY
"
interest the two discussions on the
Indiana Limestone
&
Broadway
Bell
&
Mtge. Guar. Com. & Pfd.
fefe'
Common
Pid.
Members* New York Curb Exchange
65
& Co. for some years.
Byrndun Corporation
Prior
Plan
7s
Community Gas & Pr,
Members New York Stock Exchange
;
'
Conv.
:7 6s
:V7'
.
subject of compulsory military
training which appeared in the
W. L. Douglas
4,^
N. E. Public Service
earl bowers
York Curb Exchange
New
Corp.
Southwest Natural Gas
.
Vanderhoef & Robinson
Members
branch offices
our
■
Savoy Plaza
Traded
previously made reference to the widespread
interest evidenced in the proposal for a system of compulsory
military training in peacetime, a subject that apparently is
destined to receive attention of Congress at the forthcoming
session in January. Specific evidence of the extent of public
consideration of the plan was reflected in the large number
of expressions received pursuant to the symposium com
ducted by the "Chronicle." These responses have beep ap¬
pearing in our columns beginning with the issue of Nov. 23
and a considerable number of them have yet to be accommo¬
dated in our columns. It is possible to give in this issue an¬
of comments and the remaining ones will appear
in subsequent issues.
:
In connection with this symposium, we would call atten¬
tion to several discussions of the subject which appeared in
the "Chronicle" of Oct. 26, starting on the cover page; These
reflected the opinions of, respectively, a prominent; Catholic
educator, members of the New York Synod of the Presby¬
terian Church, and the President of a prominent educational
6!/2s arid 7s
•
PA. — Singer,
Scribner, Union Trust
Building, members of the New
York
and Pittsburgh Stock Ex¬
changes, will admit George S,
Ewing and Gerard A. Hufnagel to
partnership in the firm as of Jan¬
uary 1st,: on which date T. Howe
Nimick will-retire from partner¬
ship.
Also as of January 1st, G.
Harton Singer, Jr.. general part¬
ner, will become a limited partner.
&
other group
'International
Power Securities
Direct wires to
PITTSBURGH,
Deane
We have
NY 1-1557
New Orleans, La.-Birmingham, Ala.
Singer, Beane Firm
Here Are Some More
4's, '56 (W. S.)
Chesebrough Bldg., 6's, '48
Quoted
Steiner, Rouse & Co.
New York Curb Exchange
120
Teletype: NY J-67,2
,
Stock
York
New
;
Inc.
HA 2-2772
Exchange PI., N.Y. 5
BELL TELETYPE
Members /V. Y. Stock Exchange
Ass'n
Dealers
Security
of
Sold
—
Meinour),
Members
New
Bought
>
Goodbody & Co.
Established 1920
"P. R. Mallory & Co., Inc.
-
CANADIAN MINES
Tennessee Products
Rockwood Co.
5% Preference
CANADIAN BANKS
W. L. Maxson Corp.
Nat'l
Avondale Mills
:•
AMERICAN
CANADIAN INDUSTRIALS
Lukens Steel
"*An address by Mr. Purcell be¬
the
fore
American
of
Institute
Electrical Engineers, in New
York
(Continued
Members New York Security Dealers Assn;
120 Broadway, N. Y. 5, N. Y.
REctor 2-7634
City, Dec. 13, 1944.
■n
C. E. de Willers & Co.
2812)
on page
Teletype NY 1-2361
; /
5% Pfd. & Arrears Ctfs.
Kings County Lighting
5%
& 7%
Preferreds
Nassau & Suffolk
7%
Wellman
FASHION PARK, Inc.
*Mfssouri Utilities, Common
Makes men's
Lighting
clothes;
"Fashion Park",
Preferred
Heilbroner.
everywhere.
Northeastern Water—All Issues
lem.
Puget Sound Pwr. & Lt., Com.
etc.
Also
to
CORP.
retailers
Circular
Arkansas Missouri
Engineering
Company
Owns Weber &
sells
reconversion
No
EASTERN
"Stein Bloch",
on
i
Power Co.
Request
prob¬
Common Stock
Attractive postwar outlook.
All
investment
for
our
dealers
should
WM. J. MERICKA 6- Co.
send
BOUGHT—SOLD—QUOTED
!
Queens Borough Gas & Electric
6
%
detailed
report.
7
.
Preferred
Members
*Memorandum
on
Request,
Simons, Linbnrn & Co.
(j.A.Saxton&Co.,Inc.
1# PINE
'
'
i
ST., N. Y. 5
Teleytpe NY
"WHitehall 4-4970
1-609
'
INCORPORATED
Members Cleveland Stock
J
Members New York Stock Exchange
25 Broad St., New
HAnover 2-0600
York 4, N. Y.
Tele. NY 1-210
74
N,
Y.
Security Dealers Ass'n
Trinity Place, N. Y. 6
Wires
Detroit
•
to
Buffalo
Pittsburgh
-
Commerce
-
29
Cleveland
St. Louis
Bldg., Cleveland
Memorandum
on
Direct
F
Broadway, New York 6
WHitehall
Private
4-3640
Wire to
Cleveland
Request
14
Telephone MAin 8500
HA 2-2400
Teletype NY 1-376-377
Private
Union
Exchange
MEMBERS
One
Wall
NEW
YORK
Street,
-
iLivYy
STOCK
New
EXCHANGE
York
5.
N.
Y.
Volume 160
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4346
2803
The COMMERCIAL and
Boston &
CHRONICLE
FINANCIAL
Albany
We
interested in
are
offerings of
tlCHTfdSTflil
"■
Reg. U. S. Patent Office
All Issues
High Grade
William B. Dana Company
Cinn.,Ind.&West.
1st
REctor 2-9570
Lehigh & Lake Erie
Public
York 8
25 Park Place, New
3/5s, I96S
Mohawk & Malone
3y28, 2002
Thursday,
SP'
Telephone HAnover 2-4300
1949
year
of
V
those
new
old
right with
obsoletes
Start
money.
no
Teletype NY 1-5
99 WALL
Members New York Stock Exchange
for
the
new
junk left.
Obsolete Securities
Thursday
evei;y
rid
good
25 Broad Street, New York
1944
28,
Published twice a week
"
'
Dec.
Get
Trask & Co.
encer
William D.Riggs, Business Manager
Pa.N.Y.Can.&R.R.
«
THE OLD!
.
William Dana Seibert. President
Cons. 4i, 4l/2st 5s,
OUT WITH
PREFERRED STOCKS
Editor and Publisher
4y2s, 1957
Cons.
Utility and Industrial
to 9576
Herbert D. Seibert,
-
1st
AND COMPANY
Publishers
Dept.
STREET, NEW YORK
Telephone: WHitehall 4-6551
(general news and advertising issue)
STRAUSS BROS.
Members New York
32
and every
Small Mines Securities
Monday
Security Dealers Ass'n
Broadway
Board of Trade Bldg.
NEW YORK 4
CHICAGO 4
DIgby 4-8640
Harrison 2075
Teletype NY 1-832, 834
Teletype CO 129
Our Real
Other Offices: 13b S. La Salle St.,
Chicago 3, 111. (Telephone: State 0613);
I Drapers' Gardens, London, E. C;, Eng¬
land, c/o Edwards & Smith.
Copyright 1944r by
Estate
William B,
Dana
Company
Reentered as second-class matter Febt-
Securities Department
oiary 25, 1942, at the post office at New
N. Y„ under the Act of March
York,
Specializes In
3, 1879.
Subscriptions in United States and
Possessions, $26.00 per year; in Dominion
of Canada,. $27.50 per year; South anc
Central
America,
Spain,
Mexico and
Cuba, $29.50 per: year; Great Britain,
Continental Ebrope (except Spain), Asia,
Australia and Africa, $31.00 per year. I
TITLE COMPANY
CERTIFICATES
Call
for quotes
us
;
Other Publications
Mewburger, Loeb & Co.
II Members New York Stock Exchange It
|
5
WHitehall4-6330
||
Bell Teletype NY 1-2033
And Their
Monthly Earnings Record—Mth.. .$20 yr.
on Mining Stocks Are No Greater
Experienced by Investors in Real Estate Mortgage and
Foreign Securities, Mr. Richardson Asks for a Realistic Attitude toward
the Financing of Small Mines. Calls Attention to the National Impor¬
tance of Exploiting Our Mineral Wealth, and Denounces the
Proposals
to Resort to Foreign Minerals Importations in Competition With Home
Producers.
Holds Our Federal and State Laws Now Have Authority to
Check Fraudulent Mining Stock Ventures and Urges Strict Enforcement
of Them.
ii
co n
usual
of
lo¬
fidence
has
the
Cites Need of Organization to Represent Brokers and
Exclusively in Over-the-Counter Business. Com¬
men
the Securities Dealers Committee
declared that they
particularly gratified by the
victory which was attained for
tmanimously
>were
self
was
evidence
no
of
minded
and
Allan S. Richardson
tificates
on page
stock
2825)
public
' in
change for
cash, give ceran
alleged
in
a
do
we
estate
loss
so
to
not
many years
investor.
any
frown
mortgages
or
upon
mortgage
A
son,
us
to
ap¬
even
proximate
However,
it.
sur¬
veying the sit¬
uation
a
si t
exists,
venture
we
the
opinion that
the
of
cessation
hostilities
with Germany
will
occur
within
first
the
six
months
of
1945 and with
Japan
L. H.
Bradshaw
Editor
4'Investment
n.
.
,
Timing'
Fraud
on
view of Germany's expected col¬
lapse during 1945 and the sharp
subsequent reduction in Govern¬
ment expenditure, we think that
national
income should
Security Dealers Assn.
Ill Broadway, New York 6,N.Y.
Bell
tional
Association
Commissioners,
of
St.
System Teletype,. NT 1-248#
Private
Wire
to
Eos
Angeles
Securities
Louis,
Mo.,
(Continued
on page
2825)
the Seller of Seeurities
;/
.
Counsel, Securities and Exchange Commission
SEC Official Points Out That
Although the
Section of the
Securities Act Proscribes Fraud Only on tbe Purchaser, the Securities
Exchange Act of 1934 Was Designed to Regulate Trading in Securities
Authority to Frauds on Sellers of Secur¬
ities.
Reviews Several Prosecuted Cases in Which "Insiders" by Non-
Chairman, members of the National Association of State
Securities Commissioners, Ladies and Gentlemen:
At the St. Paul meeting you af- ^
served that even within that short
forded me the opportunity to dis¬
cuss with you some of the current
space of time the Commission had
security frauds and the increase
An address by Mr. Cashion. be¬
of our mutual responsibilities and
Members New
York Security Dealers Ass'n.
170 Broadway
Bell
COrtlandt 7-6190
System Teletype NY 1-84
SUGAR
SECURITIES
curities Act
of
v''"''v'
■
DUNNE & CO.
Members New York Security Dealers'Assn.
25
Louis, Mo., Dec. 13, 1944.
(Continued on page 2826)
was only in its ninth
of existence and yet we ob¬
Commissioners
Securities
at
St.
Broad! St., New York 4,
WHitehall 3-0272—Teletype
H. Y.
NY 1-956
Private Wire to Boston
ap¬
$125
the
Association of
fore
year
the
National
burdens under the impact of the
effort.
At that time the Se¬
war
billions if the
German war ends early in the
year and $140 billions if it lasts
proximate
to
this
end
war
PANAMA COCA-COLA
June;, the
longer
continues the more likely
Dividends
with the highest
time income of
previous
peace¬
billions
$83
"
Little
taxes is
On
the
or no
to
be
■'
1942
-
$2.75
.Public National Bahk
& Trust Co.
$4.50
-
—
3.65
National Radiator Co.
'
Approximate selling price—29
■
I.-"
in
Circular
i
III.
paid 1944 to date
Dividends 1943
the higher figure is to be reached.
This
compares
very
favorably
1929.
National income for 1944 is esti¬
Members
New YorJt
Dec, 13, 1944.
By EDWARD H. CASHION*
some
National Income
military
$158 billions, compared with
the $147.9 billions of 1943.
In
time
during
the year fol¬
lowing Ger¬
many's defeat.
J.F.Reilly&Co.
Mr.
of
1945
Request
Worth and Maintains That
be running at the rate
mated to
on
.
predict the date of the war's end, and we have no
prescience t o ♦>
enable
•
Sold
Disclosure of
Probably not even a Delphic oracle, if there were one today,
could
Com.
—-
the Na¬
■
The End of the War
^Circular
report made by Mr. Richard¬
as Chairman of the Mining
Information, Obtained Securities Much Below Intrinsic
Any Broker-Dealers Who Engage in Such
Transactions With Knowledge of Such Non-Disclosures Violate Rule
in
X-10B-5, and Rule X-15C1-2. Holds Issuers in Repurchasing Securities
Are Required to Disclose Their Identity When Omission Would Consti¬
The war remains the dominant factor in the world of business
and industry, and its economic effects will continue throughout the tute Fraud and Receipt on the Seller and in Such Cases Commission
year 1945,
Will Resort to Remedies at Its Disposal.
;
I.
&
Bought
real
and the SEC Has Extended Its
Outlook lor Business
Pfd.
REctor 2-52SS
*
Securities Committee of
ex-
Com.
8
The Commission's
(Continued
Yet
mining enterprise.
practice.
securities dealers and brokers as
of
unfair
holding, con¬
trary to the NASD interpretation
that the size of the spread does
not
shift the burden of proof
without
wealth
&
*U. S. Finishing
of
records boasted of
savings of the
willing, weak-
was
Metz, the text of the SEC deci¬
sion, the Executive Members of
upon
to extract the
Securities Dealers Committee, there
placed before its Executive Members (William S. Baren, Baron
O. Helbig. and B. S. Lichtenstein) the question of appealing from
the order of the Securities and Exchange Commission, dated Nov. 25,
1944, which held that the "5% spread principle" was an interpre¬
tation and.not a rule.
C
The time within which to file *
Petition for Review expires 60 evidenced by that part of the SEC
opinion which declared in effect
days from the date of the order.
Reviewing with their counsel, that, in disciplinary proceedings,
the size of a spread in and of it¬
Edward A. Kole and Abraham M.
con¬
Pfd.
entered
security regulation.
is not so dim but that
I cannot vividly recall the losses
said to run to many billions of
dollars in real
estate mortgage
bonds issued by companies whose
accumu¬
lated
I
^United Piece Dye
memory
of
Appeal SEC Order on "5% Spread?
recent meeting of the..
before
the lush fields
V Dealers
a
business
field
My
swooped
down
Wickwire Spencer
tradition
ment
swin¬
Broadway
Triumph Explosives,
quite fair, I ask, to allow
of skepticism
of
mining to persist? I had been for
more than 25 years in the invest¬
this
sequence
dlers and
VI
At
39
New York 6, N. Y.
HAnover 2-8970
Teletype NY M203
Is it
unwary inves¬
tor
and
in
exchange, remittances fctr
foreign subscriptions and advertisements,
cust-like pro¬
i
Members New York Security Beaters Attn.
It has in the past been and to a lesser extent now is only too
the lure of relatively easy mineral wealth has appealed
strongly to the *
moters,
mittee Decides Not to
L. J. GOLDWATER & CO
true* that
swarm
:
EVERYBODY
Than Losses
the
i
:
TO
Securities Commissioner, State of Colorado
In the rate of
>
NEW YEAR
Pointing Out That the Public's Losses
NOTE—On account of the fluctuations
must be made in New York funds;
Financing
By ALLAN S. RICHARDSON *
%:
Bank and Quotation Record-—Mth. $20 yr.
UoWallSL, NY.
HAPPY
(complete statistical issue—market quo¬
tation
records,
corporation,
banking,
dealings, state and city news, etc,)
on
*
request
Analysis available
"
Taxes
Hoit, Rose $ Truster
increase in income
expected in 1945.
other hand,
Government
expenditure, even when reduced
after Germany's defeat, will concontinued on page 2830)
74
Trinity Place, New York 6, N. Y.
Telephone: BOwling Green 9-7400
C. E. Unterberg&Co.
Mehbers N. Y, Security Dealers Ass'n
Established 1914
Teletype: NY 1-373
61
Broadway, New York 6, N. Y.
Telephone BOwling Green 9-3563
Teletype NY 1-1666
.
..
.
|
"
the commercial & financial chronicle
2804
Thursday, December 28, 1944
*
BOSTON, MASS.
Oxford Paper Com. & Pfd.
Art Metals Construction
Durez Plastics & Cliem.
We
Sold
r
buy
American Hardware*
Boston &
115 BROADWAY
NEW YORK
Maine, Pfds.
i
105 WEST ADAMS ST.
>
CHICAGO
7
:
Elkton
BARCLAY
Brockway Motor*
Cuban Tobacco, Pfd.
7-0100
:
>
TELETYPE NY
'
Deep Rock Oil'
Railway
Pittsburgh & Birmingham Traction
v.
*
du
Capitol
•v7- -7./7.::.
Triumph Explosives
United Piece Dye
70
:
STREET
PINE
Works
Central Iron & Steel
$10 Par
Waldorf Astoria
Wyandotte Worsted
.
Aetna
Standard Eng.
Window Glass,
Soh*
"
•-
: !
Collins Radio
,
,
"A"*
Cement
Co.
Eastern
Corporation
Federal
Machine
Welding
&
>'
Harvester
Industries*
American
Aircraft,
New
.
Magazine Repeating Razor
Marmon Herrington
Merchants
1
:
v
•
'
,
.
,
Co.
Tank
Oil
United
Drill
United
&
S.
Truck
;
•
Pfd.
Lines
V
.
»~v-
will
have
:
..
S. Finishing,
fur-
nish,
to
m
Alabama
Mills*
employment is
Aspinook
Corp.
to be reached.
Berkshire Fine
Spinning
Botany Worsted, Com. & Pfd.
While the
Consolidated
timates of the
&
B.
S.
U.
Textile
Sanford
Amer.
Machine, Pfd.*
and
houses
other
type
structures 'for
Finishing, Pfd.
there
which
Geo.
Gas
&
Power
Elec.
Cons.
Gas
&
&
S.
mand
Com.
Pfd.
Federal Water
•
Mass. Power & Lt. $2
I
Illinois
Power
Div.
Southern
Iowa
Portland
Elec.
Arr.
Util.
and
Com.
Com.
Pfd.*
Power
Prior
i
I
Pfd.
j
Sound Pr. & Lt.
Queensboro Gas & Elec. Pfd.
Republic Natural Gas
Puget
■
I "•
Southwest
Natural Gas
In
are
Du^Mont Lab. "A"*
publication of
excellent
an
"Shoddy
activity:
7
available.
ing Inc., entitled "Your Stake in
Community Planning,'' it is said
in reference to post-war building
finance
construction,
and
haphazard
planning must be definitely ruled
out of the coming era of construc¬
<
This
tion."
Instrument*
International Detrola*
said
was
not
reasons
Magnavox Corp.*
Majestic Radio & Tel.*
in
way
Strpmberg
Carlson
Submarine Signal
* Circular
on
I
building
in
rience
and
appropriate time for
institutions
cial
Request
an
can
conference such as this.
a
*
that
This is
CHICAGO TRACTIONS
1
with past
expe¬
mortgage lending have
analyzing
the
purpose
»
wjiich lie ahead.
120
BROA'DWAY, NEW YORK 5
NY
'Phone to Philadelphia
ENTERPRISE 'PHONES
Hartf'd 6111
Buff. 6024
Bos. 2100
Direct
>.v
/
x,
$7 Preferred
BOENNING & CO.:
1606 Walnut
St., Philadelphia 3
Pennypacker 8200
Pacific Coast
—
PH 30.
Y. C.
Private Phone to N.
For
COrtlandt
7-1202
UNDERWRITERS
SECONDARY
*
' 7.V y
v -
\
,7
7 '$
MARKET
:
the
American Box Board Co.
CHICAGO 3
New
&
Co,,
1
Wall
Randolph 3002
650 S.
CG 362
Spring St.
;
Trinity 3908
1st.
ary
Mr. Lillis has been
ciated with the firm for
as
of the
manager
All
An
Mr, Van
conference
National .Committee
on
Housing; Inc., at Hotel Biltmore, Dec. 7, 1944., ; •_
called by the
;
Issues
"
H. HI.
time
Long-Bell Lumber
••
Byllesby & Company
PHILADELPHIA
Phone Rittenhouse 3717
1st, also, Robert B.
partner in the
Bear, Stearns & Co., will become
OFFICE
Stock Exchange Bldg. Phila. 2
Common
New
,
Teletype PH 73
four page brochure
now
general
com.
War Stock
Post
asso¬
some
available on request
limited partner.
•
Meri S.
CHICAGO
231 So. La Salle St.
Omit Firm in Bsrrta
and
Officers
are:
(Continued on page 2816) \
.;
Dearborn 1501
PHILADELPHIA
BANK
iBBwmiaan SINCF
Fred.W. FairmanCo.
Members
Chicago
Stock
Board
of
L
Exchange
Chicago
of Kirchofer & Arnold.
Firm
F. J. MORRISSEY & CO.
1510 CHESTNUT
Trade
N. Y. Phone
Boston Phone
Rittenhouse 8500
Whitehall 4-1234
Enterprise 2050
Bell
Aircraft
Magnavox Common
Wahier, White & Co.
ted
3
become
5s
-
w/x
208 SOUTH LA SALLE
associa¬
CHICAGO
with
Wahier, White & Com¬
Dwight Building.
Mr. At¬
was formerly
manager of
the securities department for the
Sampson Grain Co.
:
; 7
Telephone
pany,
Bell
<
Stevens
Venetian
Columbus
CITY, MO.—Clarence
has
S.X,'
/
Mutual Chemical
4, ILLINOIS
Randolph
System
of America
4068
CG 537
kinson
Fagan Co. to Admit
Fagan & Co., 41
New York
Common
Bright Possibilities
Jan.
esting, according to a bulletin just
issued by Lerner & Co., 10 Post
Office Square,
Boston, Mass;
Broad Street,
City, will admit Jack
1, 1945.
•
situation in Central
inter¬
Iron and Steel also appears
>
Slifka to partnership in the firm
on
System Teletype PH 279
Garrett Corporation
G. K. Atkinson With
Atkinson
ST., PHILADELPHIA
Phila. Phone
Trading Markets
Interstate
K.
STOCKS
19086B39EB3&I
President
Robert S. Hays;
Vice-President, B. M. Watkins;
Secretary, Marion D. Hays.
Mr.
Hays was formerly Vice-President
Treasurer,
KANSAS
;■
4
Teletype CG 257
DURHAM, N. C.—R. S. Hays &
Co., Inc., has been formed to con¬
duct a stock, bpnd and brokerage
business.
Specialists in
COMSTOCK & CO.
Rays Forms
Autopsies althe
Fractions.
Wawaset Securities
Outstanding
On January
a
&
Warner Co. pfd. &
public utility
department.
Stearns,
Lots
Empire Steel Corp. com.
Pittsburgh Railways Co.
York*
ajid Chicago
Exchanges' and other ex¬
changes, will admit Donald C.
Lillis to partnership^ as of Janu¬
;
Odd
LOS ANGELES 14
135 La Salle St.
Stock
.*An address made by
before
Dealer Inquiries Invited
7,
DISTRIBUTION
-
The current
Schaick
'
v~
American
Teletype BS 69
Middle West
NlY. Security Dealers Assn
REctor 2-8700
'
buy
.
Stearns
Bear,
of
Finan¬
their experience
of future guid¬
ance.
Very likely much more of
this will be done in the
days
been
for
Members
"
Wholesale Distributors
financing be done profitably.
I
SQUARE
BOSTON 9, MASS.
1990
will
We
OFFICE
CARTER H.CORBREY&CO.
for
but because only
idealistic
P. R. Mallory ★
I
3-7253
Public Service
Te Sdmil D. 6. Lillis
take
will
the National Committee on Hous¬
wildcat
General
POST
CHICAGO
vary
indication
place as soon as construction ma¬
terials
'
Los Angele3
Hagerstown, Md.
Telephone—WHitehall
de¬
be
will
Schaick
greatly there is every
that a building boom
Electric
I
Van
Wrnts.
&
Birmingham Gas
Conn. Light & Power
"Derby Gas
of
-
<•
Bros.
Amer.
es¬
number
Mills
Merrimac
i
Bear, Stearns t Co.
large
a.
maximu
Palmer
Y.
$5
T:part of poSt- Street,- New York- City; members
.
i:war-activity if
the.
goal -of
H.
N.
0 n
activities
Stove
U.
U.
*
other
construe t i
Pump
"A'! & "B"
building
and
•
Standard Comm'l Tobacco >'
Goodall
10
Warns
home
:
Robertson
H.
-
■
,
Sugar
Alegre
Tokheim
share
7
Pittsburgh, Pa.
LERNER & CO.
As we approach the post-war period there is a realization that
jobs for all is the country's paramount domestic problem.
It is evi'
dent
that'*>
»
▼
-r—*
•—r
;
;■
.
; '
■
Remington Arms
Riley Stoker*
H.
between
Philadelphia 2
Distilling
' "
Oxford Paper.
Punta
..
r
-Mokan
Moxie *
7
System
Circular Available
Unhealthy Rivalry Among Mortgage Lenders and the Grief in the Real
Estate and Mortgage Business Due to Speculative Builders in the Last
Post-War Period and Urges Improved Methods of Real Estate Valua¬
tions and CI0S3 Cooperation Between Municipal, State and Federal
Planning Agencies and Private Capital to Strengthen and Stabilize
Mortgage Security. Cautions Against Over Building Arising From Sur¬
plus Investment Capital and Too Much Federal Credit. y •
'j
Buda Co.
Executive
per
about
.
share
per
$16.34
.
.
Wire
New York
$7.16
.
Against Shoddy Construction, Wildcat
Finance and Haphazard Planning in Real Estate Activities.
Recalls the
■."*
.
Vice-President, New York Life Insurance Company
Insurance
.
.
.
Tel. HUB
Com. & Pfd.
Blair
Market
!
By GEORGE *S. .VAN, SCHAICK*
Amer.
Book Value
Financing the Post-Wat1
Building Boom
'
•
.
.
York, Philadelphia and
Angeles Stock Exchanges
Walnut Street,
1529
Net Quick
Request
Philadelphia, Nap York and Los Angeles
Teletype: NY 1-2425
Finishing, Pfd.
Whiting Corp.
Wick wire Spencer
Los
Private
NEW YORK 5
Telephone: HAnover 2-7793
Low-Priced Steel Stock
A
on
BUCKLEY BROTHERS
Members New
FIRST OF NEW YORK CORPORATION
Title Guarantee & Trust
Liberty
Common
We Suggest:
Standard Stoker
Great
Loom Works
Teletype BS 424
4330
Practical Study now available
on Pittsburgh Railways System
Scovill Mfg.*
Gleaner
Crompton & Knowles
Building
MASS.
9,
Memo
**
Drackett
Bank
BOSTON
Pittsburgh Incline Plane
Purolator*
Cons.
Pont, Homsey Co.
Shawmut
Monongahela Street Railway
<
Philip Carey
& Co., Incl
Brockw&y Motor*
KEystone 3101
PHILADELPHIA
We Deal in
Suburban Rapid Transit Street
Maine Central Pfd.
&
Bitlg.
v
General Machinery
Bird
Denver 2, Colo.
.
390 California
West Michigan Steel
J
Franklin Stores
U. S.
,
Valley Mould & Iron
.?■
Emerson Radio
B. E. SIMPSON & CO.
Remington Arms
1-672
Douglas Shoe, Com. & Pfd.*
Electrolux*
Lee Mining
United Gold Mines
7
Parker Appliances
.
TELEPHONE
-
Oil
Kinney-Coasta!
Portland Cement
Laurence
following:
Midwest Refineries Pfd. & Com.
Exchange and Other Principal Exchanges
-
Gulch
Empire
v
the
Cresson Consolidated Gold
Colonial Stores Pfd. & Com.
Goodbody & Co.
Members iV. Y. Stock
sell
Lincoln^Mining
Cow
v
.
Harris, Seyboldt & Potter
Aetna Life
and
Alma
Christiana Securities Common
Quoted
-
Optical
-
Bird & Son
Title Guarantee & Trust
-
American
•
Phillip Carey Mfg.
Marlin Rockwell
Bought
DENVER
J
.
Copies of this may be had for the
asking...
-; l: 7..
;
•
..
Penington, Colket & Co.
123
S.
Broad
St.,
Phila. Phone
Philadelphia 9,
,
Pa.
New York Phone,
Pennypacker 77(50 '
Hanover 2-0310
Teletype PH 180
■
.
.
.
CiXV-,—JtaT. *,****«%•
Volume
AMERICAN BANTAM CAR
American
Railways Corporation
\
c.
Light Company
Central Illinois Electric and Gas Company
Empire District Electric Company
1945
30^ payable Jan. 31,
Dividend of
Black Hills Power and
"
holders of record Dec. 30, 1944
to
s
'
$4.05)
Total'1944 to date $.90 (Arrears
$10
(callable at 14 plus arrears)
par
2805
PUBLIC UTILITY COMMON STOCKS
6% CUMULATIVE CONV. PREFERRED
,
a^ JLTiTiTMit/a
J?*~
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4346
160
t
x? x>n a
Q. A
Selling price—12%
777;y.77-Vi:,.e Circular
on
Abitibi P. & P. 5, 1953
Aldred Inv. 4y2, 1967
Iowa Public Service
Company
Jacksonville Gas Corporation
Michigan Public Service Company
7
Request
Ass'd Tel. & Tel.
5y2, 1955
4y2, 1961
Brown Company 5, 1959
Calgary Power 5, 1960 -Can. Int. Paper 6, 1949
Can. Northern Power 5, 1953
Can. Pacific RWy. 4, 1949
Hydro Elec. Bd. & Sh. 5, 1957
Intl. Hydro Elec. 6, 1944
Intl. P. & P. Nfd. 5, 1968
Inv. Bond & Share 5, 1947
London Can. Inv. 4y2, 1948
Power Corp. of Cda. 4y2> 1959
Brit. Columbia Tel.
Missouri Utilities
Company
Northern Natural Gas Company
Public Service Company of Colorado
Public'Service Company of Indiana
Sioux City Gas and Electric Company
Southwestern. Public Service Company
7
Established 1914
74
*-*
;
.
.
Trinity Place, cKew York 6, N. Y.
—Jf)"
v
WE MAKE BIDS ON
Federal Water & Gas
ACALLYN«®COMMNY
BONDS WITH
"
'
•
*
Oswego & Syracuse
Gotipons Missing
Rochester Telephone
.;7:V
Incorporated
".7
Chicago
New York
1
Boston
Milwaukee
Minneapolis
.
OR
HART SMITH & CO.
RSnfilated
WILLIAM
52
George R. Cooley & Co.
r
INC...v:,:,:
Established
ARE
OF
S. Weinberg & Co.
Members N. Y. Security Dealers
1924
OUR
ANNOUNCE
TO
BUSINESS
EDITORIAL
AND
OFFICES
HAnover
Teletype NY
REMOVAL
THE
New York
COMPOSING
Telephone
77
Whitehall 3-7830
New York 5
Teletype NY 1-2419
PLEASED
2-0980
1-395
Montreal
Toronto
AND
Ass'n
OUR
GO Wall Street
St., New York 5, N. Y.
52. William
*
WHitehaH 4-3990
St., N. V. 5
Bell
WE
AND
PRESS
^COMMODIOUS
ROOMS
QUARTERS
MORE
TO
AT 1
Community Water Service
5
ST. LOUIS
%s-6s
1946
East Coast Public Service
FA It II &
Eastern. Corp.
Common
•7
.
25 park place
CO.
Members
'■
between
■
New
"
Yorlc Stock
Exchange
■
120 WALL
:•
(North of Wall Street)
:
7 ;
New York
ST., NEW YORK
.
,
Issues
City 8, N. Y.
Peoples Gas (N. J.) 5y2s 1960
TELEPHONES
;
1
SUGAR SECURITIES
-77
Minneapolis & St. Louis Ry.
\
New York Coffee & Sugar Exchange
"V7-'v";-4
Bought—Sold—Quoted
,*
b
.
*;
r
...
'
Securities Co. of N. -Y.
---
--
\.r* '
.
,.y-7y,
;
4%
REctor 2-9570 to 9576 inclusive
Quotations Upon Request
\.y
Peltason, Tenenbaum Co.
Landreth
803
„
Bldg.
J
vtv<
*
4
'
\'
/■
W
•
Teletype N. Y. 1-2123
.
Incorporated
V
Members N.
Commercial & Financial Chronicle
,
•
Teletype——SL 486 "
*
*'
-
;
1
'■
-
/
-
<
•
7 •* *
'
i
:;
L. D..240
t
Consols
Frederic H. Hatch & Co.
'
TEL. HANOVER 2-9612
-
^
ST. LOUIS 2, MO.
5y2s '51
■
i
-
4s 1948
;
Eastern Minnesota Pr.
Broadway and Church Street
v
a
;
Security
.
Dealers Ass'n
New York
>
Bell Teletype NY
•.
William B. Dana
Y.
63 Wall Street
Company
N. Y.
1-897
;
7.
; ;
Security Dealers of North America
Herbert D. Seibert &
Chicago & North Western
Co., Inc.'
cv.
Fravik J. Douglas
STIX & Co.
announces
of his
securities
investment
.
5-09
OLIVE
STREET
.
the
7;yy-y V through
.
Lehigh Valley Coal Sales
Capital and Prosperity
'7."
.y)
f-
St. tonsl;Mo;f-\
WHitehall
Assn.
York 4, N. Y.
3-0272
.
7
" >: '.■} 7
'-f.*/' v
l-
f
'<■
,:'"S
*
v v; '
•::: t-'m
j
.
7
Greendale Minerals
;
-.
">:a
Bear Mt. Hudson River
B v f
President, Yale. & Towne Manufacturing Companj'
Stressing the Importance of Capital in Modern Production and in Rais¬
Exchange
25 Broad St., New
7; *
•rrwiTZW
DUNNE SCO.
Members Neio York Security Dealers
Members St. Louis Stock
r
By W. GIBSON CAREY, Jr.*
.
*
Pacific 4s/90
Norfolk & Southern 5s/41
continuance
Mortgage Certificate
and Mortgage Business
; ;
77 77
4%s/49
Kansas City &
ing Standards of Knowledge and Skill, Mr. Carey Asserts that Unless
We Are Going to Rely to a Greater Extent on Governmental Financing
We Must Plan to Induce Private
Capital to Flow into Productive Enter¬
To Produce a Post-war Happy and Dynamic Economy, Urges
Government Economy and the Encouragement of New Risk Capital.
Sees Danger in SEC's Attempt to Extend Its Functions and "Thus Dis¬
turb the Normal Process of Issuing New Securities" and Recommends
Raising Registration Exemption up to One Million Dollars.
Opposes
Deficit Government Financing and Controlling and Channeling of Pur¬
chasing Power by Government as Leading to Inflation.
-
Gude, Winmill & Co.
Members New Yorlc Stock Exchange
1 Wall St., New York 5, N. Y.
DIgby 4-706<l
Teletype NY 1-955
prise;
NSTA Notes
American Maize Products Co.
General Tin Investment
Petroleum Heat & Power Co.
Lion Match
There is, of course, a certain background of experience to every
point of viewf which I express..; For this reason I have tried to dig
A.
.
aut
7,.77,7
v77:
of
•
rounced
list
before the
.vith Peter J.
md pay
>f
nade if
dollars.
Conlan,
registered guests are
The Hotel La Salle has set;
vhich they
;hould
in;
T
be blade
here
-
America.
giving
am
because
lesson
.them
W. Gibson Carey, Jr.
;
7,
-
*
.
ex¬
.
the
from
is
ob-
SCure,but
rather because
I feel nearly, all of us are inclined
:,r;.Calendar of Club Events "
Roston
i
Traders -Association—Annual Winter Dinner,;Jan. 26th..
Traderj54Associatipn--Ahnual ;Winter Dinner,; Feh. 21 <st.
Traders Club "of—Annual Banquet and Preseritationoflncom-
ng
Security
•
Chfcaijo,
Bond
QffirersV Jart:
80th.-'
Philadelphia Investment
r
.rv7,
: «-,s>
r- ; 1 '7 »
Traders Association—Annual Winter Dinner,
the
of legend
meric heroes when we
a
number of
on
a
'•
Incorporated
Wall
trip
next
Teletype
NY
1-897
f
^Ass'n
,
]n.
Y.
t.
story has to do with
tigate
the Orient, at
to inves¬
other things the
I made to
which time I
among
conditions
in
was
eager
Manchuoko.
I
was
impressed
by
the
modern materials-handling equipconsiderably
•
-
New York 5,
Street
Bell
'
Y. Security Dealers
Members .N.
63
people breaking stone
They, were women.
i*An address by Mr. Carey be¬
the War and Reconversion
fore
Congress
of
American
Industry,
49th Annual Meeting of the Na¬
tional
Association
of
Manufac¬
Hirsch, Lilienthal Co.
To
Change Firm Name 7
firm
The
thal
&
New
York
turers,
Waldorf-Astoria
Hotel.
Co.,
New York
of
Hirsch,
liillien-
Broad; Street,
25
City, members of the
Stock
Exchange,
as
.
of;
January 1st will change thfc .firm
name
to
Joseph
Hirsch &
L.
Co.
Lilienthal,
t
■}
►
■
formerly
the prosperity New York City, Dec. .6, 1944.. Mr. a-partner,, died .in. 193^ and his
of this country,; especially as it Carey is Chairman of the Com¬ estate retired from
membership
Has applied to each of us. We do mittee on Industrial Financing of
dp the firm several years ago.,; |
the National Association of Manu¬
not,'.. I
believe,
search
deeply
Albert F. Clear will retire from
enough into cause and effect.
:'
facturers.. ' ;
'■ ;
partnership as of the same datC
The first story is of my wife
(Continued on page 2817) ...
,
Feb.-9th.
and of Ho¬
approached
the road.
The
.
Frederic H. Hatch & Co
My mind was soaring in
clouds
;
common
automobile
the Plain of
Mycenae
and
between
Nauplia.
an
crossing
to take for granted
;>
Baltimore Security
"
road
not
amples
aside a number of rooms and suites
.
devel¬
our
driving in
me
a
Argos
true
i; these two
will hold open for
Chairman of the
the
opment
soon as
reservations until Jan. 1. Reservations
through Allen J. Sparks,, F. A.- Carlton & Co.,
Entertainment Committee. . 7"_7 ,.
,/
force-
to
possible... Refunds will be
unable to attend.;
■
-v
•
;•
as
s
import of cap¬
ital as applied
.
Samuel Sachnoff, The First National Bank
the Treasurer,
e
have
ness
dinner, members; are urged to
the. guest fee to
Chicago,
will be served at
In order to avoid confusion
register their guests
Hornblower & Weeks, Secretary of the Club,
Fee for guests is six
r:30 p.m.
a he
fully- imp ressed on
my conscious¬
presentation of incoming officers, (who will be an~
'after Jan. 1) "on Jan. 30 at the Hotel La Salle, Chicago,
the'bar will be opened at 6:00 p.m. and dinner
t
most
and
lanquet
on
s
which
of Chicago, Inc., will hold its annual
Club
Traders
Bond
The
CLUB OF
and
in
BOND TRADERS,
Staley Co.
my ^
.
mind the 'two
CHICAGO.
E.
.
t
2806
THE COMMERCIAL & FINANCIAL CHRONICLE
Delaware Power 6*
All
In
Bought
Sold
Pacific Coast
SINCE 1889
Headquarters For
Branches
Securities
Sextoblade Razors and
Plans
Quoted
—
Its
Prepared—Conference Invited
Albert Frank
-
Blades.
Guenther Law
Cutlery Repair¬
Orders Executed
ing of Every Description.
'
Paine, Webber, Jackson & Curtis
WECK CUTLERY. Inc.'
Telephone COrtlandt 7-5060
138 Fulton St,
CO.
45 Nassau St.
7-1176
Schwabacher & Co.
.V.7
RE. 2-9192
Members
New York Stock Exchange
Curb Exchange (Associate)
New
York
Chicago Board of
Public
Taxation foir
Utility Securities
Gas, under the integration requirements of Section 11
C'f the Utility Act, is required to separate its electric and natural gas
rystems. Recently the company filed a plan with the SEC to meet
this requirement and also to simplify the capital structure by elimi¬
nating the preferred stocks (which have paid regular dividends).
principal electric companies
tric and Dayton Power
*£he
& Lights
companies
*
new
a
stock
common
v
.
Lower Wages
and He Urges
"Package" distributable for each share of
/
Existing Columbia
\
Earnings"
-v;.',-',,'
\
'■
Stocks
6% preferred stock—
Ci
shares New Columbia, capital stock
,——
4/1 share Cincinnati common stock
estimated
by Stone & Webster
There
4/1 share Dayton
common
stock
.
'/y:'-
:7''-'r
$6.03
cal
$9.35
V* share
Cincinnati
share
Dayton
1.62
---—
common
:
period,
We;' must
either
thought
people
energy
from the para¬
almost
mount
1.10
J /35 share Cincinnati common stocks
^
.30
siveiy.
.09
—
1/35 share Dayton common stock
;
.07
*
The -company
vestigation
tf
of holding company debentures to
$60,000,000 through application of
cash; (d) refunding of the bonds
employed Stone
a general in¬
Columbia and its
of
ubsidiaries and to estimate "rea-
at
onable foreseeable
earnings." It
iTould be noted that earnings es¬
i
timates
are on
ssumptions
i
< 11
3y-z % net rate.
a
'/ \;
,
Cincinnati and Dayton common
stocks will be
the basis of certain
readjusted so that
will have 958,249.1
each company
follows; (a) Taxes
the basis of the present Fed¬
eral
.46
as
The
shares.
ings
restated
share
no
excess
Clacinnati Gas
&
Electric
The
an
so
7 many
we
un-
iof
;
have
we
have the
have today;
we
national
a
$140,000,000,000.
sh national
work week
average
hours, and if
will
wha
*An
in¬
t/is
tended
to
If
income
we
of
income
assume
less
than
Beardsley Ruml i
be
address
fore /the
on
these
tations
common
wed
ii'.ieess
is
much
at
to
difficult
the
to
the
V'
share
quo¬
issues,
as
10 times est.
j
Recent
market,
future earnings
price
6% preferred
93 */a
.96
5% preferred
5% preference
82
93
70
80
Common
Association
may
by Mr. Ruml
The
.
Dumbarton Oaks
v;
A'V-'V.
International Labor Relations and Post-War Problems Committees
given
to be in the
seems
game
4%
_________
4
Hickey, President
of
United, did not approve of the
principles of the new plan as they
outlined
to
the
SEC
last
post-war June.
The SEC has not indicated
estimates, it is also difficult to its
views, except to reserve deci¬
determine a fair price earnings
sion on whether the natural gas
3 atio
to apply to these earnings
system in its entirety (.covering a
estimates.
A
multiplier
of
10
large part of the northwestern
seems rather high, but neverthe¬
area of the United
States) can be
less would produce results some-
'
retained
by Columbia.
p
rehenfor
plan
war
tion; of future
felt
advance¬
e
of
ment
the
in
the
w
js;
every
.isn't anything surpris¬
ing. As a matter of fact, if you!
didn't have dullness now the
chances
o
England Public Service
Out standing
spoke
s men
American
former
But ^dullness instead of
and
in
of
interna-,
-
tional
affairs
with
the
•
»
We
■
of
^luring this forum. Our post-
*An address by Mr, Woll before
&
Co.
NEW YORK 6, N. Y.
a
"Labor and Future Peace" Sym¬
posium
of
Conference
fairs
at
the
on
the
Dec. 16, 1944.
must
follow .if
.we
This plan called for the trans¬
only temporary. For
unless new strength comes in
the next few days, the possi¬
bilities of a reaction taking
place become more and more
likely. This belief is not pred¬
icated on any general belief
that
reaction will
a
it's
cause
"due,"
be¬
come
whatever
For the market
means.
market sentiment.
^
In
ket
•
discussing technical
last
action
said
that
within
it
week
dullness
the
it
now
of
seeds
»;v
mar¬
was
had
reac-.
of the
Nations into the basis for
outbreak
Matthew Woll
American
sions
world
participate. This
proposed international organiza¬
tion, we urged, should be empow¬
ered to use whatever means might
be necessary, including an inten¬
tional police force, to prevent the
spe-
Federation of Labor in its discus¬
re¬
action is
we
would eventually
•
la¬
joined
Preferred s
Chicago
would have
tion.
This can be explained
by the theory that there's no¬
an
international organization for
body so bullish as one who
the
preservation
of
peace,
in
which all nations, large and small, has just bought stocks.
But
various phases
to
you
And of the two, the.
is obviously, prefer-
ever
.United
1 d.
r
cialists
Wire
are
reaction.
coun¬
clear path which
a
formation of the structure
of
country
the
the
to enjoy the blessings of
continued ; international peace.' : '
are
welfare of la¬
bor
plan, which evoked gratify¬
try, charted
for
and
wars
t h
bor
Direct
Denounces
ing praise throughout
preven¬
organized
BROADWAY,
of the
disconcerting habit of
Russia's Actions in the Balkans and in Poland as
Imperialistic But thumbing its nose at ''due
Defends the British in Belgium and Greece as a Necessary Policy to
dates"
and
going its own
Prevent Communistic Usurpations, i Urges Confederations of Smalle;'
merry way. A reaction at this
Nations in Europe and Sees a Dark Future for the World If the Dum¬
time can start for any num¬
barton Oaks Proposals With Suggested Amendments Are Not
Adopted. ber of causes. The spark that
Nine months ago, here in the Commodore Hotel, the American can set it off can be
nothing
Federation of Labor, at its- post-war •.'planning lorum,, presented a
more
serious
than
general
co m
for
Gilbert J. Postley
rut--
same
Dullness at this stage
that
the
were
to dullness,;
over
far this week's market
so
has the
sive
Because of the use of
29
Proposals
By MATTHEW WOLL*
Vice-President, American Federation of Labor and Chairman of Its
and William M.
earn¬
gas
New
to be
and
be¬
in
(
United Corp. owns nearly onefifth of Columbia's common stock
how
;
,
■>•/■- Approx. value
ffv
estimate
present
various
/
Last week's market seemed
Though Endorsing the Dumbarton Oaks Proposals in Principle, Labor
123
:
SEC.
companies only)
Lave been "written up" for post¬
war conditions, etc.
(for
for
/
new
Columbia
2.58
follows:
Columbia
stock are evidently fig$1.51 a share.
"Without
the detailed explanation,
the
•
Official Criticises Its Lack of Protection to Small Nations.
filed with the
on
81%
however,<
By WALTER WHYTE C;
';
New
Jersey Bankers
Philadelphia, Pa,,
be
as
interpreted
^prediction. Dec.'. 8,1944. 'v.-',.;
Without predicting what is going
(Continued on page 2819)
;
analysis
Estimated
$3.24
each,
nervous
may,
period is that
% Gain
what similar to the
does
letter
3\ot disclose further data
Earnings
..
Earnings
1.16
stockholders'
estimates, though this is probably
obtainable from a 24-page docusnent
Future Share
;
Earnings
,'V. $1.89
ayton Power & Light
ings
shall
we
(on this number of shares)
profits
Recent Share
j\;
-
,
earn¬
40%, but for the 12 months ended Sept. 30,
tax; (b)
1944, would be as follows com¬
3;eduction of depreciation and de¬
pletion charges, using a "straight- pared with the estimated post¬
line" computation; (c) reduction war earnings:
■■■'
•
have
jsame price level
we
coming more
day. Reaction
example, $
55,000,000
income tax rate of
with
3
40
of
second
post-war
For
employed or .*•.
certainly have
have
we
difficulty
in
talking about
the
v
employment. 7 If we have 55,000,000; people; employed, and if
-
7
....
The
$
<fY Webster to make
d eci
and.
rela¬
in the
necessary
people looking for work that
ishall have, a problem of mass
of
job
winning t he
war
speedily
$7.01
"Package' for each share of existing common stock—
J/!) share New Columbia capital stock
:
;
Whyte
draw certain
can
to
mitted to dis¬
1.39
<
as
tract
$4.52
stock____AA~L--rL-
Z/1 share Dayton common stock
we
tionships that must exist
are
per¬
and
"Packkge" for each share of preference stock—
f!
shares New Columbia capital stock__.i___~
Walter
be short-lived.
to; happen,
conclusions
post-war
$8.19
"A/1 share Cincinnati
•».
that f
being
1.29
—A-;.----------,—
stock
talking about the period that is to
In the first place,;no one wants to give the impression
about
the future
$5.28
_____
-common
common
two difficulties in
war.
days
dreams
"Package for each share of 5% preferred stock—
•!
Tomorrow's Markets
a
in these criti-
1.47
1;7,4 shares New Columbia capital stock
Barbara
Sacramento
or
are
follow the
i.85
--i—
—
—
,
"Package" for each share of
.
_
as
Santa
—
Oakland
Reduced Return on Investment, or All Three Combined, Reaction becoming more im¬
30% Cut in Income Taxes and Elimination of Sales and minent as dullness intensifies.1
Corporation Levies.
Public holders of stocks be*
Participation in
"'Reasonable Foreseeable
*'
—
Fresno
Structure and (3) a Tax System Which Will Not Lead to
Inflation, but
Will Be Low Enough to Leave Sufficient Purchasing Power With the
People. Holds That Corporation Income Tax Results in Higher Prices,
Columbia, to the three classes
preferred stock and the com¬
mon stock, on the bases set forth
in the accompanying table.
of
to be distributed,
are
fJong with
Francisco
Principal Offices
Mr. Ruml
of
stocks of these two
common
Teletype NY 1-928
Private Wires to
Sari
Trade
New York 5, N. Y.
COrtlandt 7-4150
Monterey
Calls Attention to Need of a Standard of
Living Higher By
40% If High Employment Is to Be Achieved. Advocates As a Means of
Achieving This: (1) A Money System That Will Give a Stable Medium
of Exchange and Store of Value;
(2) a Sound Banking and Credit
Cincinnati Gas & Elec¬
are
Prosperity
Treasurer, R. H. Macy & Co., Inc.
Chairman, Federal Reserve Bank of New York
Columbia
The two
14 Wall Street
By BEARDSLEY RUML*
Columbia Gas & Electric Recap Plan
.
New York 6, N.Y,
Boston Chicago Philadelphia San Francisco
1879
ESTABLISHED
on
Pacific Coast Exchanges
Incorporated
131 Cedar Street
1944
Quality Cutlery
ADVERTISING
Light
Thursday, December 28,
American
Labor
International
Hotel
Af¬
Commodore,
'
>
also
of
in
wars
the
future.
suggested the relaxation
international
facilitate
a
trade barriers
freer
interchange
to
of
goods and services of all nations,
based on a complete rejection of
isolationism, ruthless expansion,
land imperialism. Finally, we em¬
phatically
tempts by
unilateral
•
denounced
any
nation
solutions
(Continued
to
on page
any
to
at¬
apply
territorial
2828)
the
same
bull
who
is
con-'
vinced
can
just
rapidly. This is not
as
become
disgusted
a
strange or new phenomenon.
Practically all phases of the
stock market movement pre¬
sent this condition.. It is, how¬
sharply delineated
periods which follow sharp
upthrusts of markets into new
ever, more
in
high ground. This, too, is ex¬
plained by the fact that an
all-important obstacle has
mamr
rmblic watchers.
(Continued
on page
Once
2829),
.
Volume
COMMERCIAL & FINANCIAL CHRONICT/R
Number 4346"'
160
The Securities Salesman's Corner
Western Pacific Railroad Co.
.
Too
r
Many Prospects and Not Enough Sales
j-O
Convertible
■feC
By JOHN DUTTON
2807
Income
Ardeii Farms
4V28> 2014
,
-
who have been .acquir¬
ing experience in the field of securities salesmenship during the
.past few.years. But there are still some salesmen who have been
plowing the same old furrows and making their rounds day after
day; never securing the results they should acquire from their
efrorts and ohe of the mistakes they continually make over and over.
again is that their prospecting is weak. :;
>:■
'
; '
r
.' We are reminded of a story related to us of what happened a
good many years ago when a now. successful securities man was
first breaking imp the business. He started out with a pocket full
J of leads and he made his calls. Every where he went he stood there
J with his hat in his hand and gratefully acknowledged each oppor¬
tunity for an interview which was granted to him. Week after week
he kept it up—his calls were consistent and his interviews were
almost too pleasant.
After several months of this work his sales-;
•manager called him in and asked him what was the trouble and
.why didn't he do some business. This fellow replied that-he wasn't
'at all discouraged. On the contrary, he proudly showed a fistfull of
($100 par)
5% Participating Preferred
There haven't been many new salesmen
Common
Common
Province of
pflugfelder, bampt0n & rust
'■
Members
.
61
you
His
wait and see."
jV '
•.
Jv-; Jj;,,::
salesmanager turned to him and told him he was
•
.
going to
much, but it was the
only way that this fellow could get the right outlook and begin to:
do business. With that, he took the stack of cards and proceeded to
rip them right down the middle and then placed the remains in the
waste basket. It was a fairly stiff jolt to this embyro young salesman
but he took it and weiit out to work with a new slant on this business.;
There are many people who are just time wasters—there are.
those Whose business is riot worth: theieffort and hard Work involved^
•There are those people who will ask you for all sorts of free infor'mation and service but who will never give you an order upon which,
you can make a profitable commission.
There are those who will
take your information and turn around and shop several other
r
dealers, or maybe end up by placing an order on a brokerage basis
while you are left holding an empty bag.
All these typical time
wasters abound in every community.
They clutter up the files of
sales organizations and the time that is wasted on this tvpe of pros¬
pect had better be spent where and when it can do both the salesman
and a real boni-fide investor at least some good; :
Y/j:
-J:
Another thing—there is no reason why any salesman who knows
bis business in these days and times should feel the least bit grateful
for business which he acquires by dint of his own endeavors.
The
ghde should be on the other foot, Any investor who has a competent
securities salesman taking care of his account should realize that
he is getting something pretty valuable.
It isn't everybody that is
qualified to handle investments in times like these—good investment
supervision of an account is' woth a (lot mo^e than most salesmen
are able to earn in recompense for their efforts.
Tbdav U oavs to take the attitude that A SALESMAN'S TIMF
TS HIS MOST VALUABLE STOCK IN TRADE.
If he knows his.
business and knows his securities he's going to see to it that the
■people with whom he does buisness are those who will not waste hi£j
time and wiil also appreciate a good job well done.
.
J L'\
do something he knew he wouldn't like very
,
'
:
"
•
•
•*
-
New York 6
Railroad Securities
Sees Out in Taxes f'oxl
advise
would
against any
r
lion in the rates.
Year If War' Hears End
10%
A
in Federal
cut
will
taxes
income
possible next year
be
only if the war in Europe draws
near
an
end,
Senator
George
(Democrat) of Georgia, Chairman
of the Senate Finance Committee,
27.
the Associated Press Wash¬
reported as saying on Dec.
was
From
in
the
New York "Sun" it is learned
that
advices
ington
as
given
told reporters that "if
around the corner in
or
come
we
that there should
horizontal cut in individual
it is my thought
be
a
mid corporate income taxes
we
worked
of the
tax
vi^-c wnt
>
The
tee
cn
a
laws."
1937.
On the whole the advance has been
time
most rail
have contended
men
all
;
whose
revenue
-
commit¬
legisla¬
emphasized
strongly that the only chance for
tion
in
Senate,
P-e
Congress.
"There
can't be any general revision of
the tax Act at this stage.
I have
no doubt we will handle a certain!
amount of tax work during the
spring,
of
kind of
fortuitous
fighting."
a
tax cut rests on "a
turn
it will be largely a
and making
present law."
but
matter
workable
revising
the
that
clared
alert
to
Congress
be
should
changing economic con-
step in
with downward revisions of tax
dRmrs
and
ready
be
^ates when the
to
fightnig ceases and
business men need encouragement
ve would favor
of
the
the
in
tide
of
If the end of the Euro¬
a
revenue
peace.
;
general revision
tailored to
laws,
A
V
■'./•
Meanwhile, he believes that if
evi¬
collapse of Germany is
dent,
taxes
For some
prices for
prices^
general 'run of industrial
stocks could
be supported by
the
post-war business prospects, then
stocks
rail
ridiculously
were
un-
moderate horizontal cut in
would be "an evidence of
a
good faith to the people." *
.
:
;
for
time to come, judging by
some
<
MEMBERS
York Stock Exchange and other
leading Security and Commodity Exchs.
.
New
statements of the management at
the
annual
May.
last
meeting
However,: dividends
120
certainly do
distant than
General
investment not appear any more
feeling is now catching up with on such stocks as Baltimore &
this, contention.
'
'J; J. yl'j:' Ohio common and preferred and
While the general strength in Katy preferred, which have been
rail equities may be jfully war¬ among the most popular trading
derpriced.
ranted
:
the
on
basis
of
the
post¬
favorities in recent weeks.
same
proved status of the carriers, it is
pears
•also- true
that
the rise
has
been
accompanied by a number of ru¬
mors
affecting individual roads.
has. been
There
have
run as
unusual
an
of merger rumors.
crop
Some of them
follows: Burlington is
supposed to be buying in the stock
of
Colorado
Southern.
&
The
&
Ohio
Chesapeake
of
merger;
with various -of its affiliated
com¬
(Nickel Plate, Pere Mar¬
quette and Wheeling & Lake Erie)
panies
reported
.s
The
imminent.
as
stock
split-up
&
Louisville
by
Nashville
quarters
hailed
was
as
in
many
opening step
the
to¬
wards
.consolidation with
the
parent company, Atlantic Coast
Line.
.This
was
subsequen tly
denied officially by the^Louisville
& Nashville management.
There
been much talk about the sup¬
posed sale by New York Central
pf some of its substantial real es¬
holdings in New York City.
tate
With the possible excep¬
"uture.
be in
to
a
At the
debt
J'f"
.
'
,
that
retirement
Illinois
accomplished.
Last
May it was announced that fixed
charges
had
been
reduced
to
around $12,000,000. With subse¬
quent bond purchases it appears
likely^ that
present
the
founded,
;•
y
prove
;:
;
un¬
L;y:;j;y;'.
,y
While the advance in rail stocks
a
is fully warranted (as
out above) on the basis
group
pointed
of fundamental values,
there
can
be below
figure. In the early 1930's
charges were above $17,000,000.
The
indicated
present
fixed
charges would absorb only about
10.3% of average 1936-1940 gross
revenues.
during
In comparison, the road
those
years
carry an average
through
to
net
Federal
before
able
was
to
of 15.5% of gross
operating
reasonable,
income
It
taxes.
income
therefore,
to
company a
fect
which
"rumor market" do in¬
element
an
of
weakness
of
the
manage¬
expressed its
has
intention
continuing
are
which
is
fundamentally
Many ra?l
men
mental values
looking at funda¬
impressed with
ties
with
program
down
common
the
debt
the
Railway
Pittsburgh
f
system,
including
;i
summation of possible
develop*
ments in the near future, has bee \
to
until
upon
share
in
an
request.
re¬
charges
News & Views
$10,000,000,
stock in every year since
1936, with
of
average
over
$14
the
past three years.
Earnings for 1944 will probably be
a
of
Company
should
around $12 a share.
In
the
current
issue
of
"Nevi
&
Views," Butler-Huff & Co. di
California, 210 West Seventh'SL*
Los Angeles, discuss recent d- »
velopments in the insurance fie!
with particular reference to sev»
eral
specific
issues.
"News & Views" and
Copies
an
uf
interest
*
ing study of The American Insu •
ahce Company of Newark, whk \
Laird ElssaiS § leads
ignored. The
bursting of such bubbles is quite
apt to affect even the part of the
market
A lucid and comprehensive an¬
alysis of the interesting complex::. •
Moreover,
cycles.
ment
Interesting Developments
In Pittsburgh Railways
Corporation, 70 Pine Street, Nev
York City. : Copies of this repor t
in
booklet
form, are .available
should not be
reasonably priced.
5
prepared by the Research Depart *
ment of The First of New York
charge bur¬
den could be supported by a good
margin during normal business
assume
which normally ac¬
excesses
YORK
that the fixed
appears
be little question but that specu¬
lative
72 WALL STREET
NEW
may even
which
justify
a
sound
credit
standing for the road, There have
been earnings available for the
will
Van Tuyl & Abbe
that
tirement
rumors
y'yJy-V' Securities
y
annual
tion of the sale by New York Cen¬
these
111.
Old and New
■
level of charges is not much above
$11,500,000 and
Chicago 4,
TRADING MARKETS
has
Central
St.,
RAILWAY COMPANY
j.'
tral of part of its real estate hold¬
ings it is the opinion of most com¬
petent railroad analysts that all of
LaSalle
SEABOARD AIR LINE-
There has been relatively little
recognition given to the substan¬
tial
So,
favorable
more
position than either of the other
two roads.
Broadway, New York 5, N. Y»
231
time the company itself ap¬
business outlook and the im¬
war
our
George repeatedly has de¬
1st Series "A" 6s, 1935 (Bonds)
ip^proved
as
Mr.
53/2S
-
—
for
do very
79th
coming
the
any
we
fully justified.
if the advanced
that
second grade rail bonds was warranted on the basis of the
"We've got to await events
fore
general revision
:n reconverting to pppre-P*>e
The press ad-, duction. It is at that time that
to say:
on
Georgian,
handles
while
J i
,
5s
good volume to the highest levels witnessed since the boom of
on
There;:, have
been
whisperings
bed
?(Conveniently vague) of a divi¬
much with gen-,
dend on Baltimore & Ohio pre¬
eral taxes," he said, looking ahead
ferred stock in the not too distant
to the committee's work m the
■y!
Mr. George
January, February or March, and
can see a tentative end to the war,
)
reduc4
-
Railway Co.
The railroad stock market has really taken hold in the past week
so and most of the popular trading favorities have moved forward
ras
isn't apparent, then wd
41/2S
-
1-310
Seaboard-All Florida
•
war
4s
Bell Teletype—NY
'
pean
ALBERTA
Exchange
credit of the carriers, and if
of them;
nice to me and I know I'll sell a lot
these people were so
•Just
Stock
York
Broadway
"
prospect cards to his boss and said, "Look at these prospects, why
,1 know I am going to do a lot of business very soon, every one of
New
Telephone—Dlgby 4-4933
.
•
Preferred
Bought & Sold
1
,
&
(no par)
the firm
considers attractive
conservative
had
upon
investment,
request from
a.n
may
n
to
Butlei
*
Huff & Co.
Laird,
Bis sell
& Meeds, Mem¬
bers of the New York
Stock Ex¬
change, New York, announce that
Louis A. Gibbs has been admitted
to
general partnership as of Jan,
has
2,
apparently been lagging well be¬
to
1945.
Admission of Mr. Gibbs
partnership in the firm was
the fact
that
hind the
are
Illinois
general list.
that dividends
are
Central
It is true
not in
prospect
':
■■
•
■
Boston &
previously reported in the Finan¬
cial Chronicle of Dec, 21.
Albany R. R,
"MOP"
We wish
General Us
~
to
purchase, ALL
Circular
on
request
1975
SEABOARD AIR LINE
SPECULATIVE POTENTIALITIES
Circular Upon Request
Underlying Bonds & Certificates
Mclaughlin, baird & reuss
Members New York Stock Exchange
ONE WALL STREET
TEL.
HANOVER
2-1355
NEW YORK 5
TELETYPE NY 1-1310
1. h. rothchild &
Member
of
National
Association
of Securities Dealers, Inc.
Adams & Peck
specialists in rails
co.
52
wall
street
HAnover 2-9072
n. y. c.
63 Wall
5
tele. NY 1-1293
Street, New York 5
BOWling Green 9-8120
Boston
Philadelphia
j
Tele. NY 1-724
Hartford
i
THE COMMERCIAL & FINANCIAL CHRONICLE
2808
Thursday, December 28,; 1044
SPECIALISTS
in
Real Estate Securities
REAL ESTATE
By ROBERT H. ARMSTRONG*
Armstrong and Armstrong, Real Estate, New York
1929
Since
Building and Loan Asso¬
ciations Is Due Mainly to Lack of Venture
Capital. Ascribes This to
Taxation Which Reduces the High Income
Groups Furnishing the Bulk
of Venture Capital and to the Decline in Real Estate Investment
Profits.
Urges That Building and Loan Associations Combine to Erect Large
Housing Projects and to Engage in Multi-Family Housing.
:
SECURITIES
Seligmari, Lubetkin & Co.
Primary Markets in:
Incorporated
Members
Hotel St. George, 4's
Park Central Hotel,
(870
•
Security Dealers Association
Broad Street, New York 4
41
HAnover 2-2100
As you will note from the program, my topic is WHAT SAVINGS
AND LOAN CAN DO TO HELP THE REALTOR.
/
■
Real Estate Securities
4's
have concentrated
York City real estate issues.;
from time to
^
Exchange
York Curb Exchange
Members New York Stock
Members New
;
these
Dlgby 4-4950
NY 1-953
Bell Teletype
>
'
'/y>;Z j/.;'//j//.Z;'ZZ;
Post-war,
Slenn Elected President
will
publish the
investigation in the
our
future.
near
of
believe, Chicago
will expand as a shipping port, re¬
sulting in activity that we believe
center in the world.
a
Ely Becomes Chairman-
The
New Vice-President
vated
John
"elected
was
President of the New York Board
of Trade
the
at
special meeting of
a
Directors
held
December
on
at the Board's Headquarters,
291 Broadway, New York.
Mr.
19,
is
'Glenn
"the
of
President
American Trust
in
the
Pan
Company, and is
banker
first
President
20
elected
be
to
Matthew
Horace S.
years.
G.
Ely, President of
Ely & Company, who served as
the Board's President during 1944,
elected
was
Board.
Chairman
Three
chosen.
were
"President of
of
the
Vice-Presidents
Herman L. Brooks,
.;
the
so-called
are
"Loop."
is derived from the ele¬
name
railroad
which
makes
Coty, Inc.,
was
elect¬
ed, and Ralph E. Dorland, of the
Dow
Chemical
Company,
and
Richard V. Goodwin, Vice-Presi¬
district
Wabash Avenue,
Lake,
Wglls and Van Buren Streets. It
on
is the heart of the downtown
tion.
Within it
the
of
large
hotels, department
stores, office buildings, theatres,
etc.
Many of these structures are
security for real estate bond
stock issues.:
%;Z; j,/,J ■.:/:;/
;
-'j/.r/: Zy/<
/!Z -j
Is the greatest cattle market in
the world.
;i
"/ZZ;■ ■ ;//Z ■.Z'/:■;/'■
Is the greatest
packing
in the world.
1
center
In¬
demnity Company, were re-elect¬
Is the greatest furniture market
Fireman's
the
of
Other
ed.
officers
re-elected
.</;';;/.•/
were:
Fund
-v.;
W.'.;J-/'
^
manufacturing center in the
y,/Z
i';' ////Z///Z
Is the greatest agricultural im¬
plement manufacturing center in
Co.
the world.
New
York, as Treasurer;
Joseph J. Magrath, Chubb & Son,
Assistant
Treasurer;
James
J.
Clark, Assistant to the President
of Liggett'Drug Company, Sec¬
retary; Edwin M. Otterbourg, Otterbourg, ^ Steindler & Houston,
Is
the
Jesse L.
Hopkins, of J. L. Hop¬
kins & Company, the oldest living
member
of
the
Board, and its
Treasurer at the turn of the
cen¬
center
the
for
■
world.
in
Has
Has
the
r-
j
the
world
busiest
world
the
meeting at which the Mayor
American business aV pro¬
for
reconstruction)
who
gram
that the period for
exercising the option of
reduced interest rates, or rf
accepting
1944
of
the
retaining their bonds, with
3%%' External Dollar
Dec.
United
States
of
Brazil, its
Ceara), and
Municipalities, and affects 30 dif¬
(other
than
Custom House Guide; Howard H.
ferent bond issues. The
Hubbard,
Underwriters
Trust
Company, George A. Krug, George
A. Krug & Company, Inc., Guy L.
Marsters, Norwich Pharmacal Co.,
ment issued
H.
Peter
Petersen,
Inc.,
Owens,
G.
.
Petersen-
McK.
Roberts,
International General Electric Co.,
William
Inc.,
H.
Stonaker,
Mill
Factors
Corp.,
Howard
Welch,
Sperry Gyroscope Co., Inc.
*■
.
Mr.
Brooks,
Vice-Presidents
Trade,
is
one
of
President
of
the
the new
Board of
of Coty, Inc.,
and
Coty International Corp., as
well as two domestic subsidiaries,
the Perfumery & Cosmetics Ex¬
port Co., Inc., and Rallet Corp.,
and
a
member of
the
Coty (England) Limited.
board
of
He has
been President of the Toilet Goods
Association since its formation in
1935.
Dec.
announce¬
27 further says:
"Dec. 1, 1944, coupons from the
new
3%% External Dollar Bonds
may
at
be
the
presented
offices
of
for
the
payment
inal bonds until they are surrend¬
in acceptance of Plan A or
ered
B
new
the
External Dollar'Bonds in
of
case
Federal
of
6%.
1921
and
State .of Rio
Sul
7%
of
1926,
Co.';'/'
Thalmann &
/•
,
.
.
/
/.;-4
State of Rio Grande do Sul 1%
of
1927, The Chase National Bank
York;
J y/1
State of Rio Grande do Sul 6%
•
of
/
1928, White, Weld & Co.;
State of Minas Geraes '8%%
;
1928
and
State
of
Minas
;
of
Geraes
of
.
,
.
State
Government
of
Pernambuco
7%
/
1927, White, Weld & Co.;
State
Rio" de
of
Janeiro
of
and $500
of 1930;
principal amount for all
other issues.
'.'
;
.
.
-
,
of
1929, City Bank Farmers Trust
Company;
: /■;:;,,.v/:'
"■
State of Parana 7% of 1928, The
Chase National Bank of the City
of New
Valentim
F.
member of the Council
omy and
de
S.
Boucas,
on
Econ¬
Finance, and Claudionor
Lemos,/'Comptroller
eral, who were special
under
York;
trends,
the
terms
Read
&
Co.;
;
.
"
1928
of
(Federal District)
Rio
Janeiro
de
and City
6%
of
1928
Gen¬
represen¬
and
Brown
Harri-
Brothers
mdan & Co.;
City of Sao Paulo 6%
The
of 1919,
National Bank
Chase
of the
Citv of New-York:
!
'
of
several
decades,
already, occurred ;7in
the
span off but af few years.
short
The economic .cyclone of a boom,
then a depression, and now a war,
is not going to leave us unscathed;
we
so
must
begin to reorient
City Bank Farmers Trust Co.;
;
•
City of Sao Paulo 6%% 6f 1927,
First of Boston International" Cor¬
light of changed eco¬
nomic conditions. / / y
;'j-v., j//
building and
mortgage invest¬
ments'on: homes.,
the
to
realtor
place
"
in
-
The business of
this
And
transmittal letters
the
A, bondholders
keep their existing bonds at
principal amount, with cer¬
tain
modifications, including a
may
from
1%%
to
3V2%,
of
for
a
sinking fund, and an
extension of maturity dates.
Is¬
suers of the original bonds would
still be responsible for the pay-
the
Brazilian
the
external
stated ;
Govern¬
debt
that: the
ad¬
offer
followed discussions with the Fore
i g n
Bondholders
Protective
Council, Inc.
The
r
dollar
bond
should, be
ob¬
U. S. of Brazil 8% of 1921,
Brazil 7%'•of 1922, U.
Brazil
6M>%
of
poration ;
'
«
of
tained, follow:
of
1926,
sell
like it
and
whether
we
not, the steady and massive
croachment
of
is!
connection
mortgages
>
the
state
in
en- •
the
economic domain has come about
beeause
we
beginning to
now
are
realize that it is the government's
business to see that its citizens
are provided with jobs, and ade¬
quately
clothed, ^and fed
and
housed.
f /-'•;/-:
Our dilemma of the 1930's
about because
rely
we
could
no
came
longer
old principles alone.So
on
of
all
sponsibilities
as
ture that is to
you
come.
in
asset
U.
U. S.
S. of
S. of
re¬
financial
have
very good
years
the whole, in
on
new
our
recent
a
That is, as far as
state of health.
their
on
face the fu¬
iZ Vy >//Z f J
we
all know,
institutions
been,
take
must
us
growth has been
con¬
cerned. The main difficulties have
found
the
in
of
lack
ther
their
income—and
there
be
principal
State
1922.
New
of
amount
Ceara
to. holders
Bonds
8%
The National City
York
under the
will
new
act
as
of
Bank of
depositary
general bond.
-■
nei¬
much of
business in selling new homes
a
and
can
very
placing mortgages on them.
The
of
result
overall
lack
the
of demand for
mortgage funds has
placed lending institutions in a
position similar to that of a man¬
ufacturing
concern
which
has
its
in
'store
must
now
-
and
rooms
no
;v-/:
tomers?"
Briefly/ the
has
been
its
on
customers. So it
be asked, "Why no cus-
shelves, but
a
reason
certain
-
imbalance
in
the
supply of venture capital and
mortgage capital. For homes and
apartments to be built; there must
be
*
both—and
a
lack
of
An address by Mr.
before ;
the
New
'
>■-' /- ;
is that there
''
t
ranging
ment
justment,
Plan
full
cumulative
tatives
our¬
selves in the
products to sell by the thousands
City of Sao Paulo 8%. of 1922,
reduction in interest rates to rates
the
,
war
course
have.
increase
City of Rio de Janeiro 6y2% of
issues, and
their Special Agents from whom
"Under
of
announce¬
'
the
have, in effect, telescoped
things which might
normally:have taken place over
been
,» - 4 :-V.;
■. •; > C>
-City of Porto Alegre 8% of 1922;
City of Porto Alegre 7 y2 %; of 4926
and City of Porto Alegre 7% of
1928, Ladenburg, Thalmann & Co:
Dillon, Read & Co. has been
named by the Brazilian Govern¬
ment to make payments of 12% of
ment.
/
time.- Those
'
offer, according to the
and
good
State of Santa Catharina 8% of
mortgage applications.
1922, Halsey, Stuart & Co., Inc.;
; Now, if building and loan so¬
City of Rio de Janeiro 8% of cieties cannot find sources of in¬
1921
(Federal District), Dillon,' vestment in homes, they cannot
|
"Last June/when the plan was
announced,
use
have
years
(Federal District), White, Weld &
Loan
past
and
movements
As
Co.
'
the
; > While
the depression of the
thirties tended to accelerate many
'
6(2%
Coffee
Realization
even more
recently
taken *011
a,
different
meaning
than they had formerly—or, have
Grande
Ladenburg;.
loans and the State of San Paulo
respective
Special Agents, without letters of
transmittal, but current interest
cannot be paid to holders of
orig¬
Plan
l'or a cash payment of from $75 to
$175, plus $800 principal amount
of
in
do, Sul 8%. homes.
of
Exchange Them
new
/:>,■'■•
-
has
been
extended'*
—
—
31, 1944 through June ment of interest, sinking fund and
30, 1945. The extension applies principal. Under Plan B, holders
to all
outstanding dollar bonds of may exchange each $1,000 bond
from
1<9
F. Budd,
Paulo
1929, The National City
York;
./
State of Maranhao 7% of 1928,
Bankers Trust Company;
reduced/principal amount, but with varying cash
States
John
San
of the City of New
percentage
going to be
are
value
or
in America.
v; /(^ /y j
■.
■
8% of 1925,
•/. The business of
Paulo/ 7% / of / 1926 loans is to
make
of
do
of
J/Zy
Has the most complete water
system in the world.
Z-://v J
Exercise Option to Retain or
took their places at the December
meeting were:
Paulo
of .San
State
State of Rio Grande
States.;
largest
reserves
Paula'1% 6f 1930
1928/ J. Henry Schroder Banking.
Corporation;' •/'/'/""/,./^;'r/,/^y/'y'
Has the largest library circula¬
Has
-y:--
San
of
State
/
payments,
gave
State
.
bank
1931," Dillon, Read
■
.
and
Has the finest parks and boule¬
vard system in the world. J
- /
tion in the United
(that is, your
mine). for the next
two.'
Many of the principles that
the-
of 1927 and U. S. of
of
5%
:
State of San Paulo 8% of 1921,
4
(North.. Michigan
■
i4.
Realization),
Schroder
Trust Company;./.. .' ".•:;//:yv-.-;;"'//
(State y .and: y \ Madison
Streets). ;, V-ZyZ- Z:*:yZ''y Z'y'r; f
Has the most traveled bridge
the
"t
•State of San
/
Avenue, Boulevard Link); '■
Armstrong
(Coffee
the
in
corner
H.
l
Co.;y
"
buildiqg in the world. •/>'v-:<
yl 1
Has the largest art schools hi
the world.'.
.y/y' Jyy -< Z/yyj
Upon instructions from the Minister of Finance, Romero Estellita, delegate of the Brazilian Treasury in New York, is
notifying
holders of all outstanding dollar bonds of the United States of
Brazil,
President.
at the
&
greatest J retail•: dry
Extend Time for Holders of Brazil Bonds to
Bonds of
Among the new Di¬
.(elected on December 14
Brazil
/■•///v//';'
goods houses in the world. Z./.y j
Has
the
largest .cold (storage
Has
estate
and
or
have governed real estate
Robt.
—-
—,
the
order
.
War.
,
long, ladies and gentle¬
Brazil 6,//2%
ZtheZ largest ( mail
the
tremendous than the problems of
have :> pressure groups and
propaganda
wrought • havoc. ■ I
frankly; believe'; that(we- .need
more cooperation-^-beeause if v all
^
houses in the world.
years,
;//>•;.
For too
.
manufactory
for
The problems that are gomg to
confront all of us in the
post-war
men;
Has the largest agricultural im¬
plement
do
can
.
loan ;:y ;
economy.
>
ity in the world
Z/yZ.J;;J; j'y
Has the largest mining .machine
•
realtors
together; c a n ..v;g.
y ;y, - ,>,
do, not only to help each other,
but to help the nation J and its become outmoded
altogether.
/
j?
has the largest Stock
yards in the world. ;
;
Has the greatest elevator capac-i
manufactory in the world.-/;
purposes, there is no
that we shall be lost
real
decade
Bank of New
tury, was elected Honorary Vicerectors
ing- and
the
affect
;
.associations
..
ends
own
own
but
business
_
8y2%
General
Counsel; M. D. Griffith,
Executive Vice-President.
^'/// Z-j JZZ J;v-Z
greatest
" '
our
'
what
realtor
and the build-
Chicago
and
world.
Harry
J.
Carpenter,
Second
Vice-President,
Guaranty Trust
of
j:
•:
bout
pursue
nation, and mention but a few of
the basic fundamentals that will
.
t he.
the world.
in
■
Is the greatest lumber market in
the world.
dent
•
hi
Is the greatest railroad center in
and
Interesting facts about Chicago,
according to Rand McNally, are
that it;'':
'
v.//'/J/'J
Is the greatest hog market in
the world.
ol
rIs the greatest stove market in
sec¬
located most
are
;
.
a
complete circuit in the downtown
Glenn
B.
in
the world.;
the world.
Many of the Chicago issues
located
distribution
and
;
"
Is the greatest grain, market
we
will aid its real estate.
Of N.Y. Trade Beard
manufacture
our
and
pianos in this country. ;. ..; : f,
Is
the
greatest £con ventioi}
numerous
:
just
us
economically, as was France po¬
litically. So, in the few minutes
assigned to me, I intend to talk
on
what the building and loans
//
the
in the«-
several
p
and
topic from.angle of
any particular
group, I would •
rather, with
your
permiss i on,. • tal k
believe Chicago has the most
we
are
studying
issues and
result of
'
V
of
process
We
el
my
Z/ZZ--Z:
J./':'■
y:.y;y.
Next to New York,
real estate issues.
>H
ever, rather
than approach
year we
tions in other cities.
SHASKAN & CO.
doubt
of
Loans?" How-
.:
;/.;••/••. 'V/-.
/ j v.? ;//j'
hope to depart from this procedure and
time publish the results of our investigation of situa*
Beginning next
for
Building
New
on
:
®
\
Can (he Real¬
111
tor
Since the inception of this column we
Hotel, 4's
40 EXCHANGE PL.,N.Y.
Perhaps this title
have
been reversed ;;
to read "How
Chicago
/v
London Terrace, 3's
Beacon
,
should
Broadway-Barclay 2's
Chanin Bldg.,
York
New
4^'s
7th Avenue)
-
City
Realtor Contends That Decline in Business of
one
will
Armstrong
York
»■
State
League of Savings and Loan In¬
stitutions, at the Hotel WaldorfAstoria, Dec. 16, 1944;
(v I
(Continued on page 2827)
Volume
Number 4346
Reports
THE COMMERCIAL & FINANCIAL CHRONICLE
ADVERTISEMENT
Trends in Government Finance
on
NOTE—From time to time, in this space,
League of Nations Bulletin Shows Increasing
SPECIALIZING
Currency Issues and Rising Debts
;
BROKERS
Significant trends in wartime public finance are illustrated in
November issue of the "Monthly Bulletin of Statistics" just
,
the
2809*
IN
SERVICE
TO
DEALERS
AND
■■here will appear an
will be of
ON
article which
hope
we
interest to our fellow Americans,
sixty-eight of a series, j
This is number
SCHENLEY DISTILLERS CORP., NEW YORK
PACIFIC COAST SECURITIES
published by the League of Nations' Economic and Financial De¬
PUOTATIONS
partment at Princeton, N. J.
HANDLED
'
A
■
AND
OVER
PROMPTLY
EXECUTIONS
OUR
DIRECT
PRIVATE
And Food For Thought
WIRE
...
-yPublic Finance
-
Kaiser & Co.
diagram comparing developments during the two world wars
shows that in both Great Britain^-
Thousandsi of tons of grain liter¬
./■
MEMREM
and
Germany- a
considerably
larger proportion of total expendi¬
ture has been covered by tax rev¬
in this
enue
> war.
in
war
pronounced degree, for
Canada and Australia, and indeed
for the United States, too, during
the- comparableiperiods: of ■ her
active participation in the two
wars, and
back
&
for
'
tails
115
this situation may be had
on
R, F. Gladwin
Firm Name
v
to
a
40-Year Record Shows That
of alcohol
made from this
purposes,
Sounds like
cycle, doesn't it?
grown.
They Fail to Disclose Evidence of Ability to Predict Suc¬
cessfully the Future Course of the Stock Market.
;•./
Be Richards,
Switzer¬ Heffernan & Benedict
war
•
*
.
Alfred Cowles Finds That
& Co. upon
;
and
other hand,
D77 3
DO
grain, pour out of its distilleries.
And then, later, thousands of tons
of cattle and poultry feed, made
from this same grain, pour out of
the distilleries to go back to the
farm areas where the grain was
,.
Neutral Sweden
TEU
Broadway,
Interesting de¬
Co.,
New York City.
operations from the middle of 1940
; ;
then thousands of gallons
SAN FRANCISCO 4
a-»ota
interest, according to R. F.
Gladwin
request,
to the middle of 1944. ;:
FRANCISCO STOCK EXCHANGE
15DD RUSS BUILDING
bonds with appreciation pos¬
via reorganization and
ropolitan territory*; hQweyer,v was
hot
actively;
engaged
in. war
-
RAN
ally pour into Schenley'sdistilleries,
^
NEWYORK 4
Teu,wwi
1947
of
BROAD STREET
sibilities
from
for France, whose met¬
Terminal 3 V2S
Boston
are
less
HEW YORK STOCK EXCHANGE
25
Appreciation Possibilities
than in the last
This also holds true, though
.
a
Boston Terminal Has
Writing in the July-October issue of "Econometrica,"
;
You see,
the
war
magazine
a
a very
a
complete
-
large portion of
grain used in making either
alcohol or beverage spirits or
dedicated to the advancement of economic theory in relation to sta-
whiskey is "recovered", because
member of
ixbiics
ana
mathematics,:■■ Aitiec: only the starch content of the grain
Exchange,:
Cowies, of the Cowles Commission nod," more than ; four times as is -actually used in the distillation
larger proportion of their total will become a partner in Richards,
for Research in Economics of the many were bullish as bearish, al¬
process. After the starch has been
budgets, including heavy defense Hume & Heffernan, 14 Wall Street;
University of Chicago, makes a though more than half of the pe¬ taken
out, the grain is processed
New York
land,
this
'
the
on
time. covered
expenditure,
other
have:
by
-
non-tax-
also
-
the
a
borrowing
Netherlands
the
Guion Benedict,
City, members of the
so
Exchange,
firm
and
-
Jan.
on
name:
will
changed
to
forecasters of stock market
fluctuations for the past 40 years.
table itemizing the tax rev¬
from 1938-39 td
1944-45 in 13 countries reveals the
the
year
kructures
by
year
meet the
in all parts of the world.
United
The
reached
had
States
forms.
exigencies
':y.
Customs
revenues;
the United
in¬
to fall off in 1944-45.
Sharp declines iri customs yields
have taken place, on the other
hand, in France (—90%). Japan
pected
Sweden (—50%), the
A r ge 111 i 11 e
(—50%), ' Brazil
(—35%), and Australia (—35%),
<—75%),
while collections under this head¬
ing have remained fairly constant
in the Union of South Africa and
in New Zealand.
: 1
.
shows
that a significant shift in the com¬
position of public debt has taken
place as a result of the increased
A second special diagram
short-term "borrowing during the
pean countries for
which adequate
available
are
States
United
as
and
forecast
well,
the
per¬
shrunk since 1938-39.
,
,
and New, Zealand at 10% to
course
solidated.
Production ,'/V
in the
the
of the summer and early
a
from
bearish, the
subsequent action of the
market, On the assumption that
Production
United
•
below:
year's
last
volume,
as
shown herewith:
Jan.-Sept.
r"
41,631"
.
1944
r •
1,372
Jan.-Sept.
42,447
:
•;
67,325
Jan.-Oct.
Jan.-Sept.
.
United
67,738
..
Jan.-Sept.
"
Jan.-Sept.
•■United
States
Canada
„
—■—
war
drops 10% j: the score is 0.95.
pared with
age
a
change
stock
the
in
level
the
of
The results
the "index; of
performance,"
are
derived
by
dividing the actual compounded
The
each
Mr.
Cowles
from
marized
as
the. study is
follows: '
\
:
(1) The records
of
11
sum¬
'
ber
18
the
following
promotions in the executive staff
postcard
.
•
Assistant
appointed
Chief Examiner and will. directly
supervise the Exchange's staff of
field
examiners.
connected
with
He
has
the
been
Exchange
since 1928,
Vv;;1
Jan.-Oct.
Jan.-Sept.
146
693
734
•"
115
Jan.-Sept.,
95
of
the stock market.
(2)
99
course
Of* the
6,904
corded during the
forecasts
re¬
15 V2-year
pe-
Titus, Jr., who has
been placed on inactive duty after
two years service a? a Lieutenant
in the U. S. Naval
Reserve, is re¬
turning to F. J. Young & Co., Inc.,
52 Wall St., New York City, as
a
Vice-President. Mr. Titus served
as
Provost Marshall and
ant Chief Examiner.
Security
gan.
J He has, been
with the Exchange since
"Leonard
G.
Bedarf
1928.
Officer at the United States Naval
'
Mr.
lie, Michi¬
-
Prior
to
entering
the
service,
has
been
Assistant, Treasurer.
made.
He
identified with security trade as¬
Exchange since
sociations, having been, a director
of the Security Traders Associa¬
has been with the
1926 "
.
-t-
-
v-
Titus had
been
„
prominently
tion of New York and
Ward & Co., 120 Broadway, Nev
City, have prepared circu¬
lars on: several situations whic!
York
& Co. upon request:
Du
Mont
.
Massachusetts
-
&
&
Sons; Cons. Cement "A":
Riley Htoker: Alabama Mills, In'v
Amer%an Hardware, and H. &
American Machine.
.
,
Attractive Investment
The Public National Bank
"A":
Power
governor
Security Dealers
Association.
In addition, he was
formerly a director of Claude
Neon
Lights. Inc.,
and of the
Scullin
Steel
Company of St.
Louis.
" T
;; ;
v.
Laboratories
a
of the New York
Attractive Situations
Bird
96
Young Co.
Air Station in Grosse
;
Merchants Distilling; General In¬
leading: strument;. Great American Indus¬
varying
of F. J.
t
"Ronald R. Westwood, Assistant
Treasurer, has been named Assist¬
years, fail to dis¬
close.-evidence of ability to predict
33i
-
.156
periods
htter' to
Wn. Tilas Jr., V.P.
William A.
Light $2 preferred; Maiestic Ra¬
dio; Magnavox Corp.; Electrolux;
Brockway Motors: Scoville Mfg.:
over
or
Schenley Distillers Corp., $50 Fifth Ave.,
A. y, 2, iV. ZV and you will receive
la boonlet containing reprints or earlier :
articles on various subxxU in this series.
;
of the
1927,.
from 10 to
since
;';'
■ ■.
.'■>;•MARK MERIT;
additional
tries;
'
'
•' v;;
of Schenley Distillers Corp.
Emil Schram, President of the
Exchange, announced on Decem¬
forecaster
conclusion
consume
By Stock Exchange
currently offer attractive possi¬
by the. bilities, the firm believes.
Copie?
random
forecasting
record. re¬ of these circulars, on the follow¬
ferred to above and subtracting 1. ing issues,
may be had from- Ware
of
when the
even
only about 2 % of
grain supply, and
about one-third of this grain is
subsequently converted into farm
,
the "random
called
■
these alcohol require¬
purposes,
principle, such as
turning points in the
feeds.;
market after prices for a month
averaged higher, and selling after '/
•; Surprising?
they averaged 1 ower, than for the
period,
which; hereafter for ;cbnvenience
as
'•
-
the nation's
at
market "v for ' each
Will be referred to
;
remembering:
ments
"inertia"
financial periodicals and service"
Nickel
Canada
.is 0,90; and if the
shortage in
And here is something else worth¬
may
169
*
.
success
means
beverage industry is producing
alcohol at top capacity for vital
likeli¬
819
-
:
325' ';
Jan.-Sept.
......
'Canada
168-
-
'
"Zinc
a
;
,
production of the country's
milk, meat, poultry
while
stock
successfully the future
.J
States
score
forecasting; record for the whole
period.
These results are com¬
.
898
Jan.-Oct.
States
."Canada"
United
indicates
pounds yearly. All of which
and eggs.
'
positive
in
Exchange:
A.
"George
Cuff,.
If the forecast is 100%
has been
and
the market drops Treasurer,
The compounding of the weekly
scores, for
each agency- gives its
2,030
2,031
,
Lead
■
ket
draws
~
with¬
funds from the
forecast is doubtful and the mar¬
1,408
'
.
Copper
.
bullish,
10%; the
have
would
of his
all
market:
record
Thousands of Metric Tons
1943
u
States
investor
drawn
presented,
Pi« Iron
.
the
forecasting record."
Period Covered
Canada
is 1.0, regardless
the
pbuhdingbne-halfofthe'percent-
that of. the corresponding
'■
Steel
score
of
of certain non-ferrous metals, on
— -
which
buying
If the forecast is 10.0%
the other hand, has been reduced
The amount of notes in circula¬
the
the
of
Output in the
months of last year.
of Payment
disclose
structure
hood' that whatever
as
months* taken as
whole, however, equaled or ex¬
ceeded
tion is -still increasing unchecked
V United. States
fluctuations
the
of
figure representing
the average of all possible fore¬
casting results, arrived at by com?
in; the
reached
levels
top
spring of this year.
V.j-..:'.
Means
■
first nine of ten
Japan
reports
practically; the
Whole, of its public - debt as con¬
of
recovery—-.
basic foods:
40-year record is not entirely acdidental. A simple application of
in reserve.
,
autumn has fallen off-a little
the
15%.
tests
evidence
funds in stocks, and hold one-half
inflation in
United States and Canada in
Union of South Africa. Australia
statistical
he would
reflected by the
Standard & Poor's average of 9C
increase of' 87%
circulation in Japan dur¬
•Iron and Steel production
short-term, debt remained practi¬
his
of this advantage.
While pros¬
pects: for the speculator are, there¬
fore,
not
particularly
alluring,
50%
grain
important to the farmer, because
shortage of feed
Under present laws the capi¬
tal-gains tax might wipe out most
age.
The forecasts thus
light
significant
v.-;
76% in Turkey, 70% in
France, 59% in Denmark,. 57% 1 in
cally unchanged in Switzerland at
about. 27% and in Canada; the
is
aver¬
:
that country...■
.
million
composing
industrial
be claimed for the very consistent
stock market
Sweden's note circulation increas¬
reached
.
Dow-Jones
(September). Ger¬
representative common stocks; If
many 39%
(September), France
the forecast is 100% bullish and
35% (June), Belgium 26% (Au¬
the market rises 10%, the fore¬ previous month, would have re¬
gust), and Portugal 23%
(Au¬
sulted in substantial gains for the
casting score is 1.10. If the fore¬
gust).
caster is doubtful, the score if period under consideration.
Neutral Sweden and Switzer¬
1.05, reflecting one-half of the
land show the smallest percentage
market advance, on the assump¬
increases during the past year of
tion that the investor, being doubt¬
all
the countries covered, with
ful, would place One-half of his
eration of the pace of
Germany, 54% in Finland, 40% in
Belgium " an® the
Netherlands,
?7%' in the United. Kingdom, ,and
25% in.the United States and in
Sweden. ;
The
proportion
of
was
tabulated have been tfested in the
Denmark 41 %
in note
By 1943-44 the proportion rep¬
resented by the floating debt had
the
prices
ing in stocks.
ing the 12 months ending Septem¬
ber, 1944, suggests a rapid accel¬
;
doubtful,
have
stocks; and if 100%? bearish, noth¬
1943, show the fol¬
percentage r increases in
note circulation:
Rumania, 73%
(June), Hungary, 70% (August),
the
Netherlands
54% (August),
A
centage share of the consolidated
debt in the total public debt has
was
would
been secured by a continuous in¬
the reader, if the
100% bullish, would
was
than
put half of his funds in stocks; if
50%
bearish,
one-quarter
in
lowing
the
in
It
better
vestment in the- stocks
bullish, he would put three-quar¬
ters of his funds in stocks; if the
.
data
the record.
plants in four states; which will in? ;
crease feed production to approxi- ;
mately two hundred forty-four
1903, :"or
the 40 years showed results 3.3%
a"year
of the two inter¬
used as the basis
market; if the forecast
over
same month in
was
Schenley is expanding
now,
installing; new equipment at its
•
invest all of his funds in the stock
ing by only 9% (September), and
Switzerland's
by
14%
(Sep¬
tember).
Thus, in most of the Euro¬
war.
of 16%
that
assumed
forecast
reached
have
was
for Computing
£1,164,000,000, an increase
October, 1943.
creased in
Kingdom
In continental Europe the same
by 150%; in Canada by 70% to •general trend is apparent. Fig¬
80%, and in the United States by ures for the latest months avail¬
35% up to 1943-44, but are ex¬ able in 1944 compared with the
;
average
pretations
124,387,000,000
and
in. Canada
of war-time finance, e,g., through $1,012,000,000,
increases of 27%
and 21%, respectively, since Octo¬
Imposition of excess profit taxes,
kindred surtaxes on income 'and ber, 1943. In the United Kingdom
consumption taxation in various note circulation in October had
to
Right
;
its facilities for
when tabulated back to
of bullishness or bearishness
which he thought they contained.
By the
high-
ing agency with - the best results
fbr ' the
15 ¥2 - years since
1927,
gree
end of October note circulation in
changes made in the natidhal tax
enue
beginning.
(3) The "record of the forecast¬
Mr. Cowles
in this analysis was for each of
iwo readers to grade the forecasts
independently according to the de¬
,
protein feed for dairy cattle, hogs \
and poultry. : '-•■
■
: ; ' -. J
only about two-thirds of their
level at the
The method used by
and forced—as
:'■ A
at
ing
Richards, Heffernan:
Benedict;
occupied in the present Mr. Benedict has been an individ¬
was France—
ual floor broker, and in the past
to pay heavy contributions to the was a partner in Richards, Hume
& Heffernan.
occupying" power:
;
■
was occupied by bear mar¬
into just the finest kind of
kets, and stocks at the end were,
the records bf eleven of the lead¬
but
war
riod
statistical and analytical study of
the
1st,; and
be
Denmark, both neutral in the last
war
;
York- Stock
New
on
and
revenue
•
H.
have
substantially
B.
and
Trust Company of New York of¬
fers an attractive investment, ac¬
cording to a memorandum of the
Sept.
30,
1944,
statement of the
bank, which is, being distributed
by C. E. Unterberg & Comppny, 61
Broadway, New York City. Copies
of
this
may
interesting; memorandum
be had from the firm
request.
;■ '
upon
1
Vl
THE COMMERCIAL
2310
Ohio Municipal
Possibilities
For Post-War
Comment
'//■/ Dr.' Leonard Spangenberg, Vice-President cf Babson's Statistical
Organization, Wellesley Hills, Mass.,' told a Babson Field Conference
By J. AUSTIN WHITE
recommend
we
Stock
Common
'
•
'
f
f
i
.
•
Memorandum
otis & co.
O.
Bell Teletype
CV 496-497
Cleveland
.
Phone
CHERRY 0260
:
■
.
volume
ness
far this year whs
so
reached in June;
13,
is
major cities, in¬
to the basic trend in most
—-;
since
ance
However, a pro
%
He has been with Reli•graduatica from Penn¬
State College in 1924..
S. Lord, another Reli-"
nounced.
sylvania
jec-tion of present trends indi¬
drive.] Electric Co. (and from the affili- cates that another new peak is
The period of ate
serving the northern Ken- !likely to be witnessed this month,
the .Sixth War tucky communLies just across the
Consumer spending here during
Loan has been river, the Union Light.Heat and the holiday season now can be
no
As a natural resttit expected to set a new record
exception, Power Co.).
1899
ESTABLISHED
Tower
of business activity in Cleveland
and the underlying trend is scill upward.
each
(Incorporated)
Terminal
"volume
cluding those with a. large concentration of war contracts.
.'."The peaK in uievtxa.xd
note that in each War Loan drive to date the
municipal market has held quite firm and piices have risen
s.owly toward *
—r1
—
the
end ' of itself from the Cincinnati Gas and
Ohio
the
contrast
This is in direct
It is interesting to
*
■
that
Cleveland
holding well above formal
.V
somewhat higher.,
move
-•
Request
on
at
Quiet strength-of prices was apparent throughput the
Sixth War Loan drive and during the past week or two prices have
••
.■
municipal market continues to demonstrate a strong
Ohio
The
undertone.-
Standard Stoker Co.
Thursday, December 28, 1944
FINANCIAL CHRONICLE
&
Kenneth
chief
WPB's
veteran who served as
ance
of the electrical section of
i
tool division during 1942-43, was
succeed Helm at Phila-
named to
t h e j of this decree, there is some ialk moderately abo /e last year's higK idelphia7 -77/7 V77%7v;7/!/-K/7
*.\ ..' •' .'
:
1
'
If
1 •' fj®'." i y
[ ■'
/■*'•:>
face
that
at 1 tnai tne City of Cincinnati should /level.
C;
.'/;/: //// % /„• ■ ■ ,;
the
outset of buy the Cincinnati Gas & Electric
;Central National Bank,' third
/
"Inasmuch as we are expect-
despite
*.
"
•
'
v
.
..
.
latest
this
OFFERINGS WANTED
drive
were
that it
opinions
OHIO
heard
KENTUCKY
would
MICHIGAN
well
be
J. Austin
White
t
strength in mu¬
current
The
140
nicipal prices is the
nificant
Philip
Ohio
' '
members
:
of -'Market
this
Stock Exchange
Dixie
Terminal
Building
Tele. CI 68 & 274
issue of
Columbus School District
1.38%.
sold
a
COMMON
such
make
is
There
least
not
there
any
with
the
.91%.
I
The
no
Columbus
aboutas
high a price as such issues have
ever brought in Ohio.
The price
at' which,the Quyahoga 'Falls issue
sold probably represents . an all
time high for an issue of this cate¬
gory.
v'/
' -■
"'j
Circular
on
Request
sales
represent
INCORPORATED
Commerce
Building
CLEVELAND
Members
29
CV
quite
were
reoffered,
when
6
despite the fact that in some cases
the top bid for the bonds repre¬
sented a sizable cover over the
bid, and also despite the
fact that reoffering of the bonds
was made just before the Christ¬
mas
holidays;
But there is al¬
ways a keen interest among Ohio
buyers for bonds of the character
of Perrysburg School District. The
OHIO
market
SECURITIES
Union Cent. Bldg.
Bldg.
CLEVELAND
CINCINNATI
Tele. CI 150
1 ele. CV 174
' - -
l—i
•
of
barren
any
character for some
months, and the continuing strong
appetite among investors for such
names is indicated by the recep¬
tion
Union Com.
been
bonds of such
this
bus is
Field, Richards & Co.
has
consideration
nicipal
buyers
among
the
over
by the company.
charged
Columbia stockholders.
obligations of the school dis¬
are both scarce and of high
quality.
The favorable reception
given the Cuyahoga Falls school
bonds can be ascribed largely to
the general demand for munici¬
pals.
The
success
of these offerings
speaks well for the underlying
Inc.
demand
for
well
for
the
Ohios, and
augurs
prospects of
more
Possible Large Cincinnati
SECURITIES
Revenue Issue
possible large issue of Cincin¬
nati
gas
arid
electric revenue
a
Members
Cincinnati Stock Exchange
bonds
18 E. 4th
S\.
Cincinnati
-
.
.
MA 1627
CI 494
that
could
run
millions of dollars.
into
many
decreed
that
The SEC has
the
Columbia
Gas and Electric Co. must divorce
enjoyed perhaps
period ot growth since
General- Crowell
joined us as
its greatest
■;% -yv'.'
drop int# political harangue.
if
Date
-*•
•
Deo.
13
,*/.
corporate
1.18%.
1.50%
.32%
Products
.33
,1.18
1.34
1.51
6
.1 35
1.59
1.18
v0v
15
1.36
1.53
LIS-
Oct.
18
1.35
,1.53
Eep.
13
1.32
1.50
Aug. 15
A 1.31
1.49
1.13
lyi
1.43
.1.15
1.31
1.46
,'1.16
Dec.
July
12
__
June
14
May
17
16
1.15
1.17
1.50
L19
1.37
19
1.53
1.21;
1.57
1.23
1.59
'X 1.24
Dec.
15, 1943— 1.42
17
Jan.
1
'
.32
,
.34
,
.35
.
.
"1.22 '
1.39
1.57
2.01
'1.65
Jan.
1, 1942— 1.^2
2.13
1.70
Jan.
1, 1941_^
1.83
2 14
1.62
Jan. '
1, 1940— 2.30
2.58
" 2.01 :
Jan.
1, 1.939— 2.78
3.33
2.24
Jan.
1, 1938- 2.98
3.42
2,55
.35
„
/-
.30
:
.43 v'
■
.52 :
.
.57
:
1.09
.87
.
:
20 bonds. - flO
lower grade bonds.
110 high grade bonds.
§Spi-ead between
high grade and: lower
grade bonds.- v L
:
Foregoing data compiled by J. A. White
8c Co., Cincinnati.
•"/'
'■"Composite
index
lor
Net
t
"
T.
Cunningham
reports
Cunningham
-
of
Co., president, of
Edward E. Parsons
&
the exchange;
Jr. of Wm. J. Mericka & Co., and
Lloyd O.
Birchard of Prescott &
Co. have been elected
as
the
nom¬
inating committee to select candi¬
dates for offices of the exchange.
Situation Looks Good!
Engineering Company
offers
interesting possibilities ac¬
cording to a circular issued by
Wm.
Mericka
J.
&
Co.,
Inc.,
2?
Broadway, New York City, mem¬
bers
of
the
Cleveland
Stock
Ex¬
417
sells
was
--
-
-
vinrin^ syndicate that bid 100.73
obligation
bonds,
vnt,irirtrt from December,
1945 to
Kan.,:
1954.
last Aug. 31, net
~
general
;/ Bonds
vie Id
$1,474,869; total curand liar,
T.
of automobiles/truck
motorized military
C
/'
./ "
/
.
Reusch & Co., Cincinnati,
Ryan, Sutherland & Co. of
Toledo,' was
awarded
$280,000
Cuyahoga Falls, O., school- district
I Vz% bonds on a bid of 100.30.
The
•
Ball, Burge & Kraus of
Cleve¬
bonds,
4965. were
'
*
*
underwriting group of Wm.
Mericka & Co./ of Cleveland,
Fox,
present,/ certain
at
to
cent
Chicago
and
marine' and industrial
and,
ordnance items.
per
,/;. v/-
equipment;' parts and accessories
for aircraft and aircraft enginesengines
reoffered
.90
Co.. of
An
and
parts1 for.
to
Trust
second with a bid of 100.69.
was
$9,472,694.
tractors
were
.40
from
Northern"
manufactures
and
wide range of engine and
a
$274,500 City of Kansas City,
for
eight
the
assets '$21 479,198
other parts
to
due Nov.! 1,
1946 to
.70
reoffered to yield
'•/'./
1.50 per cent.
Stranahan, Harris & Co: of To¬
land, was a member of the Gold¬ ledo, was second, bidding 101.37
man, Sach$ & . Co. group which
for l%s and Pohl & Co. and as-t
offered to dealers approximately sociates
of
Cincinnati/placed
1.100 shares of Cleveland Trust fhird with a bid of
101.31, also
Co. stock at 207 y2, ex-dividend
for l3/is,''
■ /■;"'V'./' '
['
$2.50. •
Mericka, Fox;
Reusch and
;
ijs
i'f
%
■.
;
.
•
,
Edward
manager
E, Helm,
district s-^les
in Philadelphia for
Re¬
Engineering Co.
the new general
of the company,
liance Electric .&
s^les
-
For
1.942.
for
.
luring the last war.. /
Otis & Co. was a member of the
-//"%/>)■?■
amounted to S2i-
profit
profit
since
Copies of this, circular
be had from the firm upon
Isl¬
the Virgin
establish
helped
1943, compared with $2,051,-
may
request.
ard
'Thompson
Cleveland Stock Exchange
Russell
City, Pa., and assistant chief
examiner of the R.F.C., and had
304.148 for the year ended Dec.
31,
ung
that
of the First National Bank
wood
debt
/'/fi.
stock.
re«t
OHIO — Rules
committee of the
to
he had been cashier
of EU-
loan agency,
and 359.737 shares of no par common
bilities
arbitration
commit¬
trust
and
1937.;, Before coming
Cleveland'as manager of the Heconstruction Finance Corp,'s local
savings. //>v
months ended
; CLEVELAND,
1938, having been
ands National Bank, Virgin Islmancing, will consist of $2.700,00C
mds, as well as working on banknotes dated- Feb. 24.
1941, pay¬
ng matters also in Puerto Rico.
able to banks maturing in equal
He was born in Butler County,
annual
instalments
of $450,000/
°a./ in 1892, attended Penn State
45.000 shares of 5% ' cumula+ivr
College and served in the Army
preferred stock, par. value $100;
%
and
in
tees
■%"/•//; /;:■
to the bank
came
director and member of
a
the, executive
enlarging p**o- i
and effecting
funded
September,
elected
make sub- ;
capitalization as of last Aug. 81
and after g'ving effect to this fir
■',31 '■?
Gelbaeh
Mr.
in
capacity
Outstanding
.29
-
1.83
..
J cost
.20
1.43
1.43
1,74
__
ductive
/.30/'l
the
qualified to as*
the leadership
perfectly
his share in
of this bark." he said.
for pur¬
equip¬
manufacture of
products,
new
n
•
.33
,t
•
1.31
.
..
.36 •"
"
1.40
15
Jan.
.'..36
1.14
for
ment
'
is
S'ur»e
Thompson
purposes.
intends to
contribution to our growth;
■^reat
He
chases of machinery and
-
/:'5
L18
1.32
__
April 12
Feb.
,
.' ,34
in
general
for
a man whose experience
the barking field has been a
Gglbach,
sfantia!. expenditures
:.34 Yi
O
in the new
us
capacity.-,;;/; -;/ ''/-;/;/;
We are very happy having in
added
will be
available
funds
,;,v f
'
20, 1944-_ 1 34%
him continue with
in
'are
Net proceeds
to
Dec.
"Co,
,
;
.
&
announced nego¬
progress for- the
purchase of land and buildings
comprising the company's plant
in Euclid, Cleveland suburb, nov
leased
to
Thompson
<Aircraft
Products
Co. by Defense Plant
Corp.- /■>i /./.,/;
•'
tiations
change.
just
:
"The bank has
The company
hoped that any further dis¬
cussion of municipal ownership in
Cincinnati will not be allowed to
Wellman
Recently there has been talk of
ing to our plans, Gelbaeh will be
made President at the ekpiratiop
of General drowell's present term
of office. ■
./ "•
Prior to that he was
Union Trust Co.,
McDonald
activity after the holidays.
INVESTMENT
position of Chairman of the
the
Executive Committee., Adcording-
and Smith, Barney &
It is
nation,
trict
January,
him to take
have >asked
we
Cleveland
Co. headed president in 1938, and it is with
a feeling of success and gratitude,
the-underwriting group that of-to
have decided to distribute
fered 60,000 new common shares that we accede to his wishes in
Columbia's holdings of Cincin¬
of : Thompson
Products/
Inc., relieving, him of- administrative
nati Gas and Electric stock to.. priced at $47.50 per share.
respons'bilities in order to have
::mu¬
and
and
the expiration
upon
of office in
of his term
with
••
7:
duties, General Crowell has asked
to relieve him of the activities
of President
Co., ■ Baltimore, to
position. Before go
'.'fIX \ X * v.i",'
enjoying well merited fav¬
orable
W. E. FOX & CO.
i
the
7;/ 7'
,
John C. McIIannan, ^Chairman
9*
Board, in a statement on
the changes, said:
"Because of the pressure of
us
to
associated
Colum¬
received.
issue
years,
Martin he was employed
for five years with the Cleveland
Railway Co. in various officio1
ing
Moreover,
Columbia
Gas • &
Electric
officials are ' reported
Nov:
second
&
new
next
Committee of the Board of
bankingdirectors.
and
made
be
bank
the
be made Chairman of the Execu-
'7.
in
Clark left the post of As¬
take his
at
private company, nor with
Mor.
594
YORK
received
well
Exchange
NEW
BROADWAY
■
Yet all three issues
14
Cleveland Stock
Teletype
.
of
will
of
has an¬
Gelbaeh;
charge of loan
month, succeeding Brigadier Gen¬
eral Benedict Crowell, who is to'
at
present.
Nor is
Cleveland, and later was active in
public dissatisfaction ' the liquidation of the Guardian
service given by the
Trust, Co.: ,>;%%%:■ /%//;%:/%;,;/,, ;■% K
,
m. J. MERICKA & CO.
7
''
prominent
business
Martin
L.
-
ownership,
administration,
President
sistant, to the President of Glenn
Cuya¬
Perrysburg and
Clark,
would
/
public demand:/ capacities.
municipal
for
i
de¬
he
J':'' :
7fr: 7.
77
number
a
Mr.
to
investigation
to have stated
city $100,000).
the
cost
Vice-President in
has been I
appointed
Controller
of
Thew j
Shovel Co., of Lorain, O., Presi-i
dent F/ A. Smythe,. announced.
I
(which investigation the chairman
of council's finance committee is
reported
V.
Cleveland
for
resolution
an
T 7'7#
,Waid
advocating that the City
investigate the ad¬
vantages
and
disadvantages / of
municipal ownership of the Gas
& Electric Co., and representa¬
tives in city council of this group
a
excellent,"
be
Cleveland,
.
that Loring L.
nounced
i
next year, it can
Cleveland business
clared.
Cincinnati
introduced
will
-•W
Falls
school
Union
try
group are
have
10%
relative to the rest of the coun¬
.
of
of
be seen that
and apparently .is
being given its greatest impetus,
.0 date, by one of the local poli¬
tical parties, the Charter group.
The
governing officials of -this
yet,
as
half
first
simply in the first
talk is
The
stages
largest 4 in
to fall
during the
nationally
5 and
between
"
School District sold
$225,000 due 1946-65 at a worth¬
while premium for IV2S.
II
?
bond issue..
enue
business
ing
,
from the sale of 'a mortgage rev¬
$174,o0o due 1946-55 as/Is at
net interest cost of
hoga
>
prices./ Perrys¬
in
$387,000 due from 1946
through 1968 as IVzs at a net in¬
terest
cost
of
approximately
an
CINCINNATI 2
Tel. Main 4384
strength
burg School District, in
Wood
County adjacent to Toledo, sold
York Curb Associate
New
'
A few recent sales demonstrates
.
Exchange
Stock
York
Strength
Sales Indicate
w. D. Gradison & Co.
New
Co., of course, with the proceeds
rates
& Com.
Bonds, Pfd.
Cincinnati
higher
%/;.//;%/.%/'
prices.
Recent
•
at slightly
active,
more
Gibson Hotel L. T. C.
Income
the year-end period,
municipal market is
and
tne
Pfd.
Co.,
drive and the
practically into the holiday sea¬
Common
Certificates
Carey
close
Despite
the fact that the drive carried
son,
Trust
Land
'•
week
holidays.
Christmas
Sport Products Common
Paper
a
the
between
of the War Loan
Pfd.
sig¬
more
only
that
in
intervened
Whitaker
ex¬
subscribed.
OHIO
TELE. CI
Gruen Watch Co., Com. &
o r s
pected, at the start, that the Six in
Loan
would be so heavily over¬
TOWER
2,
say
probably
few in-
very
v e s
KLINE, LYNCH & CO. he.
1804
to
that
MUNICIPALS
CAREW
the
previous loans
•—not
CINCINNATI
as
received
were
as
PENNSYLVANIA
MAIN
few
1928,
is
manager
President
James
W.
Carey
ari-
Pohl & Co. were successful bid¬
ders for $509,000 2 to 214
works
due
bonds
1954
optional
to
in
1973.
10
water¬
O.,
Bucyrus,
of
Bonds
years
at
are
par.
(Continued on page 2824)
.
Volume
f
Number 4346
160
Business and Financial Outlook
We
(Continued from first page)
X
ing cut back and this reduction
j
will
uries
,1945.
those
Even
and
railroads
j industries which expect to bene-
will
while
suffer,
Bought—Sold—Quoted
grocery
to
with Japan
and cotton textiles for civilian use.
long
a
war
.
will increase
month
\ of
1945.
Furthermore, time re-.
) quired for reconversion will not
i he as great as most people believe.
.
every
price values, rather than volumes,
I will continue, as a whole, during
i 1945 about as during 1944.
Raw
X material piles will be larger, but
manufactured
goods
will
be
smaller.
;
5.
/ 7/;-
•
.
Population increases
the
in
United States during 1945 will be
about
700,000, but the birth of
new
.babies will fall off somewhat.
Retail Commodity
>
Prices
/
.
Rationing, will continue
-through the most of 1945. During
the early part of
to
further
see
in
-dally
restrictions
espe*
ete^XxXx'/'-/'/"///j.'
retail
The
necessities and
be
I expect
year,
connection with meats,
canned goods,.
7.
the
higher
prices
1945
during
most
of
luxuries will
some
than
X/X7X I
ready collapsed.
8.
24. There will be
1945
in
pede
make-shift
to
rid
get
ersatz
the
of
which
goods
have been made to take the
place
but most
hold firm
will
bituminous
and
b
consumer
sell
or
at
For both gasoline
higher prices.
7 be
decline
may
1945,
during
goods
general
coal, there
may
The great
10.
i 1945
will
question mark of
how, to whom and
be
jat what price the Government will
dispose of its
i
billions of dollars
worth of unneeded
^
b
11.
The
supplies. 7/77.
Outlook
Farm
weather
the
be
.-greatest'factor in farm production
^and
during
prices
weather
•
'.good
been
the
on
1945.,
The
exceptionally
has
whole
for
the
past
'
few years; but
will have
later we
drought or an
sooner or
severe
a
freeze..-'X/X7X777X >
12. Pending a weather upset,
'•early'
p
bushels
x more
•and
of
corn
bales of cotton will be
more
raised in 1945 than
dur history.
may
wheat
and
ever
Although
before in
some
prices
slide off, the total farm in-
;%onie for the |irst half of 1945
'.should hold up.
"X";X;- 7';.;:-;'/x.
|
13. There should be a 15% de¬
cline in hog
slaughter and a' ?.%■
increase in cattle slaughter,
v
14. Dairy products will continue
to increase both in volume and in
■?/;
price. I am forecasting at least a
X3% rise in volume.
15. Farmers will start in 1945 to
work again
for legislation on their
parity program, due to fear of a
•collapse in all farm prices after
the
war.
X
:
Taxes
7:■
/ XX
-7:
will
x
17.
be
25.
many
Wise will be those manufac¬
turers, merchants
who
and
consumers
that
realize
post-war com¬
petition will be terrific and, there¬
fore,
withhold
1946.
7
X
purchases
until
X
XX7-: xv :. 7X:-XXX
7
con¬
tinue to increase during 1945.
18.
Whatever
is
done
about
taxes, the cost of living will con¬
tinue to rise during 1945.
19.
Providing jobs for returning
soldiers will
football
of
be the
1945.
I
big political
am
not now
prepared to forecast what will
happen in this connection.
20. Through a coalition of Re¬
publicans and Conservative Demo¬
crats, we should have a "do noth¬
ing" Congress during 1945.
Retail Sales
21. The volume retail sales will
show
a
decline during 1945. Prices
them
both
for
both
moving
Switching
50%
over
1945.' 77
27.
.',,
ships in
777X7XXXX X .777.XX:
There will be
an
increase in
free
exports / with
the
"Freed
Countries/.'-but Lend-Lease7ex¬
ports, will decline.
28. We
29.
%7',x/:;xX':\7 77r-
will make England and
Both the British Empire and
Russia will go into the competi¬
tive
1945;
foreign trade market during
many cartels and >Govern-
ment
monopolies will be in
opera¬
tion.
I, therefore, forecast higher
prices for coffee, cocoa, sugar and
many other articles for which we
absolutely dependent vupon
foreign countries..
/• 777'-' 7. .77;7 %
30.
No central bank will be
ganized
of
or¬
foreign currencies be attempted
in 1945.
XX"'
■
7X7 7;7'
■.
XLabor
,
7,/
-
,
77
XXX/X'/'X/'/Xx
be amended during 1945.
7
32. Industrial employment dur¬
ing 1945 will be off 7% in hours
off 10% in payrolls.
33. The building of a few new
and
autos and
46.
new
houses will be
sumed during 1945.
X
7
re¬
ward
'//7■ V'.X'j'i
loan
bank
continue
tendency
have
to
up¬
in
,interest rates
!
ernment controls will continue.
/.47.
Anticipating
Federal
in
decline
expected
the
taxes,
1945
falling off in
the price of most municipal and
probably other tax-exempt bonds;.
7 48. The highest grade corpora¬
should surely see
tion X bonds
a
will
decline
during
l'945/77/' ..XZ. 7/;X.7';';'7..\•. //Z/. /7 ■/
y 49.' Investors 'will give much
more
and
attention
diversification
to
bond
staggered
maturities
'■
.7
;
much
erate in such
ada still
own,
gested war areas
set'in.
'X. 7X7
'
53: Small productive farms will
continue to increase in price; but
■
;1'
■
■
,
•
farms
may
sell for less iri
'
1945 than in 1944/
Many industries, now oper¬
54. Building will show a consid-'
011 a 48-hour-week, will re¬
erable increase. Contracts will be
turn
to a 40-hour week during
up 25%, but prices may be a lit¬
1945.7X7, X77
^XXX7V^-7,V;;XX7;.X7:':7X
tle lower due to increases in lum4
35.
Wage rates will not decline,
the
in
world
37.
Japan will not hold out
tor of 1945 will be Mr. Roosevelt.
Japan
within six or 12
months after Germany collapses.
38. If Stalin's health continues,
People will soon fear that he may
resign before the next Congres¬
long
will
as
most people think.
collapse
he will be the world's most pow¬
man
peace
in 1945 and may dictate
terms, especially for the
Pacific.. .7* ;'-"X7 7'
x", v .7
39. Sometime after April, 1945,
Russia will join (or threaten to)
the Allies against Japan but only
sional Elections either
of ill health
a
Peace
or
on
account
to become head of
Commission
new
or
World Organization.
X.
58. Our foreign headaches
,
becomes
worse
and
more
will
frequent
during 1945. What we are going
through to reorganize Italy will
be repeated in many other coun¬
the
promise
of territory
privileges and a huge loan.
40. The markets may witness a
"communistic scare" during 1945;
but
they
should
soon
recover
during the
year
which
at
correcting dislocation
exigencies and the
preparation of a stable foundation
thereafter. <•
Stock Market
American
GOVERNMENT
for the postwar era.
least, in
no
PROVINCIAL
Last but not
planning been
systematically conceived
more
without detriment to the
fort. '
■
XX■' 7.7/7.
7
X
MUNICIPAL
other country in the
world has postwar
CORPORATION
ef¬
war
"
777.
In the
political field, threats to
stability from many directions
have
been
successfully and
CANADIAN STOCKS
con¬
structively
circumnavigated
by
the Mackenzie King Administra¬
tion, and at
time has Canadian
no
prestige abroad stood at a higher
level. During the year Canadian
representation on world councils
has
consolidated
Dominion
the
Ferhaps
has
tively
been
:
fact
X X
;
the
TWO WALL STREET
situa¬
NEW YORK 5,
eve
of
a
so
barrassing
many
to
xissues
em¬
can
face the country's de¬
cision with quiet confidence.
as
a
triumphant up¬
the C. C. F., highlighted
apparent
result
elections
the
of
earlier
the
offers
chance
best
,
Saskatchewan
the
in
provement pricewise in the Mont¬
real
issues, there were indica¬
underlying strength. Any
practical demonstration of insti¬
tions of
tutional
could
of
fitted
its
electorate
a
stable
was
a
with prices finally
Although
there
bonds
surgence of
were
.
titude
to
est
decline
during 1945, because
shipbuilding
airplane
and
stocks are already
pretty
deflated.
42.
and
much
}
60.
With
to
regard
possible
ture prospects, the only
ful
factor
the
Federal
situation
is
ejection which
is
in
the
likely to be called at
the
strong
any
time
any
in the next few months.
wise, the
troubles
and
our
South
will
Other¬
market is in such
technical
hold their
own
see
favorable interpretation of?
the political developments couldl
an
ward direction.
or
are realizing
that without
Spiritual Awakening no peabe
other plans will be much gooa.
Nations cannot be depended upon
to
agreements unless- they recognize
God as their real Ruler and Guide.
safest
stocks
to
buy—
&
Company
NEW YORK 5
ually
during 1945; but consumer goods
The
64 WALL STREET,
religious
will do much better.
43.
Taylor, Deale
increase
more
cooperate
and
stick
to
their
canadian securities
Government
♦
Provincial
a
thai
shape
WHitehall 3-1874
1945 will
fu¬
doubt- ;
interest, including more churchgoing, than did 1944. People grad¬
a
The heavy chemicals, steels
motors may
other countries
during 1945.
41. The rails will show the great¬
the
has passed its peak. The at¬
of Argentina will extend
com¬
on re¬
59. The Latin American honey¬
moon
on
re¬
ports of favorable drilling results.
best
im¬
a
activity in gold shares
readily set the trend in
no
ex¬
traded
manding the most attention
higher.
was
section
with the Yellowknife issues
turnover
brisk
this
small scale but there was
a
country's wartime gains.
In the securities market,
the
was strong with little activ¬
ity in the high grades.
Abitibis
were
again a center of interest
there
in
now
Internal
year,
government
consolidate
to
interest
rapidly correct the
isting price lag.
tone
and
ny-l-1045
Government
the
out, the Liberal Administration
The
rector 2-7231
.
have been successfully thrashed
surge of
N. Y.
conserva¬
election, In view of the
that
now
INCORPORATED
power
outstanding
the
on
a.lames&co.
of
X
be
can
stated,
national
world
political
the
problem but it
position
a
as
right.
own
tion1
the
tries.
after
ex¬
——'
1
intro¬
was
;
as
- •—-■
CANADIAN BONDS
7/7Z-77/7
legislation
waned obviously from that point
production.
Xbut "take-home" income will be
Similarly, the Progres¬
55. There will be no changes in onwards.
less.
;7
-X X'X'X X..V7;X/, X-:;'v/. 7
sive-Conservative
effort
in
re¬
residential rents during 1945.
7 >
cent months is likely to prove the
7XX/7X7/War Outlook 7'"1
56. Real estate will be helped
36. The greater part of Ger¬
by Congress ceasing to induct any swan-song of that party. Thrust
many's army will collapse before more men into the armed services out of its apathy following these
the German planting season open£ after June
30, 1945.
Xv/V/X^./ challenges, the Liberal party al¬
though likely to lose its over¬
in the spring of 1945. Before sur¬
Politics and Post-War Peace
whelming majority support, stands
rendering,
Germany
will
try
on its successful war record, and
poison gas.
X.'7
■ -'7.
57. The uncertain political fac¬
ber and cement
./
-
suc¬
caused by war
34.
ating
'v
aimed
in
'
may
maintained at the
was
record total of field crops was
a
:
almost'^
duced
with
the con¬
where declines
excepting
and confidently.
production
that Can¬
manner
a
machine.
Social
higher prices during 1945.
•XX 52. City leal estate should hold1
its'
which
1944
leads
economic
in its
demand
handling of difficult problems, the Do¬
cessful management of the overall
Real Estate
greater
in
challenges
reputation
to its
up
doubled the 1939 figure. Govern¬
mental controls continued to op¬
7' 51. Suburban real estate will be
in
capable
traordinary war-time peak levels and
X!
7
Canada met many serious
year
abroad, but living well
the economic front,
established
municipalities and
"Authorities" during 1945.
and
courageous
On
during 1945.
:
50. More public utilities will bd
taken over by
home
at
minion finished the year strongly
rates
an
general will remain low through
1945, since the money supply is
now 20%
above normal and Gov¬
large
7
Though
•
should
will the stabilization
nor
1945 will continue to witness
inflation, although the
big: movement toward 'inflation
will not take place until the next
business
depression which will
follow the .post-war prosperity.
own
of the world's
7X
45.
less together.
or
creeping
x
26.. The United States will
the
eliminated altogether.
witness
Will
By BRUCE WILLIAMS
During the past
with
stocks; but 1945
war
./.y x Xx/7yy Bonds
,7,7.7X7 X/X;
x; xx./;■ >■ Foreign Trade
■
erful
The Federal debt will
decline in
sales" of unrationed merchandise.
•./ V
16. Taxes will not be increased
the demand for peace stocks
a
K
has been over-done in most cases,
witness
"x, x;
-during 1945 and some will be re¬
duced; in fact, some nuisance taxes
System Teletype NY 1-920
Canadian Securities
large increase in
a
will
31. The Little Steel formula will
will
saw
more
Thus, 1945
"mark-down
are
price concessions,
1944
44.
of good merchandise, x
Russia large post-war loans pro¬
materials in
Bell
great stam¬
a
vided they spend the money in the
United States.
^X/Xv/Xt
war goods will decline. This
applies also to the heavy chemh
cals.
V ..77X ■; /. /
.; 7/ /
9. The wholesale prices of raw
Street, New York 5
WHitehall 4-8980
considering
value,
income and
Davenport, Iowa *:/ ,X 7/.:;7/x/77' safety—will be the merchandising
San Jose, Calif.
i
>
* • * ; stocks, especially the chain store
Wichita, Kansas
stocks.
'X''7X;
/ 7/.''7:7—
X'Xx;
little higher, but prices of the
2ieavy
Incorporated
14 Wall
Cleveland, Ohio•
Steel prices of
a
Toronto Stock Exchange
81 Broadway, New York 6,N. Y.
V7Z77V7/Z>-x/47XXX
goods needed
Tor peacetime manufacture should
be
Members
Altoona, Pa.
x-7;vvXX7 7777
New York, N. Y.
"
*
at
present., The prices of some of the
luxuries, such as furs, have ah
...
.
should be:
ness
V
6.
Wood, Gundy & Co.
CHARLES KING & CO.
woolen
The best cities for 1945 busi¬
23.
«
•
for
demand
increased
an
inventories quoted at their
4.
>
during
maturity
*
;.j will be disappointed. '
i
3. The reconversion of indus¬
try from war to peace business
from
yielding 2.83%
sales should be higher. ».7.77;-V/■ '7
22. The total dollar retail sales
should be about equal to 1944 with
lit
;
3% Bonds due November 15, 1968
Price 102.875 and interest
of ladies' apparel and general lux¬
through
Dominion of Canada
stocks
$
continue
$250,000
""canadian
For 1945
rapidly
offer, subject:
♦
Municipal
r
Corporate
,
up¬
;
THE COMMERCIAL & FINANCIAL CHRONICLE
2812
TheEnforcement of the Pnblic
Insurance & Bank stocks
Bought
,
ANALYZED
-
---
Sold
Quoted
REVIEWED
-
incorporated by
COMPARED
r
(Continued from
various other system relationships
and. activities.'
Our powers here
Orders solicited.
are
CO.
BUTLER-HUFF
,
CALIFORNIA
OF
4
210 West 7th St.,
Chicago
TELETYPE L. A.
-
Los Angeles
WIRES
PRIVATE
New York
HEAD
C. T.)
Trading daily la. m, to 5 p. m. (P.
Inquiries invited.
San Francisco
27!)
L. A. 280
Seattle
not limited to
requirements of
They include regu¬
latory authority arid duties, the
most important, of which is the
i duty of requiring. geographic inte¬
gration and corporate simplifica¬
tion of public utility holding com.pany systems.' ''."v
,;■'''I'•,
In administering this statute we
have been bending our efforts to
the development of compact and
efficient operating systems with
conservative corporate and cap¬
disclosure.
.
Bank and Insurance Slocks
This Week
Bank Stocks
—
ital
'
By E. A. VAN DEUSEN: ;
- '
• '
Vl
''
"Leverage" is a most important factor in bank earnings.
It is
usually measured by the ratio of deposits to capital funds. This ratio,
however, neglects cash; items, dhcluding; reserves on deposit with the
Federal Reserve Bank.
A more realistic and practical "leverage"
is the ratio of earning .assets to capital funds.
The following table
compares these two "leverageTatios" for a 'group of 15 prominent
Wall Street banks, as per balance
'■ " :
'■
1 ;
Sheets of Sept. 30, 1944.
It. will
.
be noted that
V'1\hV.
.
**
■■
Cap.
to Cap.
Funds
16.9
Bank
©^-Manhattan
19.6
Bank
of
Yofki
14.7
Nfew
Insurance
Funds
to
Bankers Trust-
15.3
12.8
Inquiries invited in all
13.4
,
Tr.
14.2
16.6
7.7
Chemical
Corn
Bk.
&
9.9
Guaranty ..Trust
National
Public
U.
:
Trust>!+^;,
■'
3,9
13.7
>.• Average'!_———
4.3
York
Stock
Exchange
120 BROADWAY, NEW YORK 6, N.
•
Y.
Telephone: BArclay 7-3500
;
Bell
*15.8
18.1
National——
New
Members
13.8
12-3
•S.'TirustJ^-—'-ti,
As
17.6
.
16.0
13.6
City__——
New York.
Laird, Bissell & Meeds
9.5
18.6-
Manufacturers Tr—.
forth
';
Teletype—NY 1-1248-49,
(li. A. Gibbs, Manager Trading Department)
'
"."'f 12.3
; -
pointed out two weeks
ago in this column, deposits and
[ earning
assets. have
expanded
during,.the war years far more
rapidly than have capital funds.
I At thfe3 same time net operating
earnings have, shown a substan¬
tial year by year increase as a re¬
sult of this growing volume of
earning assets, and of, increasing
"leverage," However, by reason
of higher operating expenses arid
taxes, combined with a prepon-'
'
derance of low
yield Government
securities, net earnings have not
kept pace with the expansion of
earning assets; on the:other hand,
though, they have more than
matched the expansion of capital
funds.
This situation is brought
out in the accompanying tabula¬
tion, which shows the percent
earned on
capital funds (book
value) and the percent earned on
earning assets,' by 15 banks for
the year 1943 compared with 1939.
1943
L.-;
'
4939-
IRate Earned on:
Bank
of
New
Bankers
Central
'■5.3>o
York^—-i._:
Rate Earned on:
Capital Funds Earning Assets
"
fc.2% '4-!u4):54%/ !
: '
,
;
,
Uh'i 0»64
0.68
j.7.,7
6.7
0.91
6.8
5.8
—
_i_—
0.98
5.4
-!———
Trust
Hanover —
Chase, National
;
;
Capital Funds Earning Assets.
0.61%
0.76
6.9
^
.
...
.
'
& Trust-
4.2
0.73
8.4
Corn
Exchange ——
4.6
0.82
First
National
8.7
0.55
0.49
S.
0.72
recognized that ^imprudent and
improvident f inancial policy
could impede and had "impeded
the use of sound techniques .in the
development of the'., industry, it
directed, the SEC to do a financial
engineering job.in the public
utility
hpldingcompany field.
The magnitude of the assignment,
as you. know, is
tremendous.
If
involves reshaping the corporate
structures and control relation¬
ships in the various holding com¬
pany systems. Its completion will
reshlt only from long and pains¬
taking1 effort•?of' ours' and jpf' the,
'companies subject to the "Abt^;Bdt:
even
though the {j'ob is a(': •Ibh'gprotracted and difficult one, I be¬
lieve
0.62
that the
flow from it
1.21
effort
benefits
arc more
that
5.5
0.61
the
4.7
0.59
after it has been
1.05
13.0
will
than worth
and will survive
1.01
long
0.74
.
7.3
0.85
6.4
0.87
7.8
-»
7.0
1.02
7.0
Trust————w—;
5.3
2.32
5.8
across-
To
0.72'
Trust.——
National
Average
„—
5.8%
—
;
0.52
7.0
or
4.03%
g
n
territories- in
3
a
elements
of
In
1935
49
elec¬
could count
on
Burlington Gardens, W. t
the
Associated Banks:
Glyn Mills &
BANK OF
NEW SOUTH WALES
(ESTABLISHED
£23,710,000
We
Aggregate
how
they hap¬
pened without accepting the ne¬
cessity of their indefnite continu¬
Sept.,
a
completed.
large extent the conditions
sion
The Bank of New South Wales in the oldesl
and largest bank, In Australasia.
With over
branches In all States of Australia,, in
New
Zealand,
the
Pacific
London, it offers the -most
vqluotaj-y plans.
However,; the
companies by and .large neglected
the., opportunity to follow the
route* of voluntary
compliance
and chose instead to play a wait¬
ing game. They responded to the
Commission's invitation by sub¬
mitting tentative plans which on
examination appeared, to be im¬
practical and not in conformity
banking
service
to > investors,
traders.; and travellers Interested in these
countries.
;•London offices:
29
;
1
cor¬
their
growth of holding company sys¬
tems" in the. '20s, when holding
more
the
with
In
statute.
.general,
plans
amounted
to. little
than attempts to justify re¬
;
Spencer MoeSi Partner
Alfred
Benjamin will become a
partner in Spencer B. Koch & Co.,
120
Broadway,
New
York
City,
members of the New York Stock
Exchange.
Mr. Benjamin was a
partner in Benjamin & Sternbach
which1 is dissolving.
■
'
Charles G. Stachelberg,,
partner,
limited
and
general
Marion E. Cohn,
in' Spencer B.
partneT
Koch & Co., will retire on Dec. 31.
is; also
of
interest', to
note
funds
6.2
in
.1939, compared!
on Sept.:
30, 1944. Since deposits and earn-;
ing assets are still expanding1
more
rapidly than are capital
funds, it follows that "leverage";
was
with 11.4 in 1943 and 12.3
Established
1891
jl8 Clinton St.,. Newark 2, N. J.
'*
MArket 3-3430
-
*" * •**
N. Y. Phone—REctor 2-4383
,;
{
' •
:
•
i
;
t
NATIONAL BANK
of EGYPT
Head .Office
:
'
Cairo
!v,W!>
,
Commercial"Register No. t Cairo,',;
■
FULLY PAID CAPITAL
£3,000,000
RESERVE FUND
43,000,000
4,-
!
^ondjon agency
"^,
6 and 7. King^JVilliam Street„ ^. ,C5.
^
Branches
<1
fn all
the
■
■
i'
'
principal Towns- ftt
EGYPT and the SUDAN
NATIONAL BANK
of INDIA, LIMITED
Bankers
to
the Government
in
Kenya Colony and Uganda
Head
Branches
26, Bishopsgate,
London, E. C.
■
:
•'
India, Burma,. Ceylon, Kenya'
.Colony and Aden and Zanzibar
,
'■
Office:
in
Subscribed Capital
_£4,000,000
Paid-Up Capital-^.—_v£2,000,000
Reserve Fund__-.^„-i
£2,200,000
The; Bank
conducts
every
description
banking and exchange business
■
,
of;
:
Trusteeships and Executorships
also undertaken
problems
Dye .offer
interesting situations,
according to circulars just issued
by J. F, Reilly & Co., Ill Broad¬
way^. New'York-City.. Copies of
these circulars may be
the firm, upon
had from
request,! ..!!!..
-
\
its last annual report to Congres
and I call your attention to tha
report.
In that report we liste(
efficiency
planning. In many of. the more important the electric, gas and non-utiiit:
their
eagerness
to
accumulate orders, particularly as regards di¬ properties which had been di
properties,
holding
companies vestment of properties, have been vested by the various holdini
ciples
of
engineering
operating
■
stock of
interpretation
arid regional power
issued.
common
of
have been
have been settled, procedural pat¬
terns have been established, and
orders
Preferred and
Ji S. Rippel&Co.
held,
utility companies ,all
over
the country—and even in
earnings. It is not possible at this
foreign countries; This extehsion
time Hfeven, to
guess
when this of
holding company control had
process of growth will come to;
little or no' relation to economy of
an end.";
.'..4 '
management and operation or to
the integration and coordination;
of economically related operating
Situations of Interest.
properties.
TJ. S. Finishing and United Piece
|
tri ;the various systems
vied with each other in acquiring
•
Bank Stocks
the' boom, however, a. substantial
that the average "leverage" exert-j
part of the empire-building was
ed by earning assets on capital!
in direct conflict with sound prin¬
will continue to increase and thus!
Municipal Bonds
4
-
It
.
New Jersey
;•;!.■
Agency arrangements with Banks
throughout the U. 8. A.
tention of existing scattered hold¬
promoters,
sometimes ings. It thus became clear to the
It will be observed that where-;
working on a. shoestring invest¬ Commission that, compliance, with
as
the
average rate earned
on
ment, used the public's money to the Act could be .achieved only
earning
assets
declined
from
acquire properties, frequently at through the institution of affirma¬
1.03% to 0.72%, a drop of 30%,;
inflated prices.' Insofar tive proceedings to compel com¬
the average rate on capital funds highly
as
Accordingly,
in
the
holding
company,
control pliance!
increased from 5.8% to 7.5%, a
brought about the coordination of Spring of 1940, the Commission
gain of 29.3%. In 1939 the rate on
instituted its first Section 11 pro¬
capacity and the formation of
capital' funds was 5.6 times : the;
Since that time most
interconnected "regional ceedings.
rate on earning assets, while in strong,
of the hearings, to determine the
power systems, it very definitely
1943 it was 10.4 times.
j
served* the publiq interest. During .nature of the Section 11 questions
-
Tkreadneedte Street, E. C.
' 47 Berkeley Square, W. t
.
..
rect resulted from the mushroom
and
and
Islands,;
complete
efficient
proceeded to rearrange
the holding company systems and
effect needed reorganizations.
Initially, every effort was made
to. encourage the companies to file
;
800
appro¬
to
DAVIDSON*. K.B.E.,
General Manager
has
0.55
have been directed to
under
;
—£187,413,762
Head Office: GeorgS Street, SYDNEY
In accordance with these Con¬
gressional mandates the Commis¬
that
we
businesses
30tl>
1943
.
priate circumstances. We are also
directed to require, the 'simplifi¬
cation of holding Company., struc¬
tures, including the elimination of
unnecessary
holding companies
and the reorganization of holding
companies which are unduly com¬
plicated arid over-capitalized;.
\
Assets
ALFRED
SIR
,
ance.
dental
1817)
Paid-Up Capital
£8,780,000
Reserye Fund
6,150,000
Reserve Liability of Prop— 8,780,000
mediate .expediency, nurtured by
rivalries.
,^o.
Australia and New Zealand
upon
would permit; Such ap¬
parent uneconomic developments
flowed from the strategy;
qf im¬
understand
r;:
Williams Deacon's Bank, Ltd.
company
Alfred B@3ijasnin to Be
£115,681,681
;
by holding companies.
As many
as
15
holding companies con-,
trolled properties in Ohio, and in
can
Street, W. /
TOTAL ASSETS
map close to 50 different islands
of operation properties controlled
individual ! system
Smiihfield, E> C. t
Charing Cross, S. IV* 7
64 New Bond
.
you
Bishopsgate, E. C. 2
8 Wesl
economy/
For in¬
stance, look at the State of Ohio.
power
throughout Scotland
LONDON OFFICES:
Crazy
other basic
tric
0.71
•
1 d i
quilt with no
relation to regional power needs
1.46
7.5'
City—
York
Public
U.
—
Because the Congress
9.5
Manufacturers : Trust
New
'
8.6-
2.22
utility indus¬
operating methods and
standards.
0.65
4.3
u.:
Trust
National
.
sprawled
veritable
o
discussed in
2.3
Guaranty Trust:
Irving
0.80'
";J''
7.3
Chemical Bank
•
f,v
1
h
papers
nical and
•;
was
Bank of Manhattan ----•
and
nical
9.3
.
10.8
-
Irving
separate
Branches
shows
owned by
companies
Royal Charter 1'727
O F FIC E-—-E din burgh
It
Congress determined that they
the tech¬
of your; society. should riot continue and, in the
Unfortunately, however, the Holding Company Act, directed us
financial and corporate practices to limit each holding company
of "many of the public utility holdr system to a single integrated pubr
lie- utility system, with provision
ing company systems stand—-qr
once! stood—in striking and uri^ for the retention of additional
favorable contrast to their tech¬ utility systems and related inci¬
13.6
7.9
Unlisted Issues
12.6
Exchange---!
First National———
.
properties.
how these properties,
.
.
11.0
14.4
Chase National—--!
Stocks
14.1
•
12.1
Central Hanoyer
i
! !
2802)
going to several other States the local utili-;
talk about those things tonight, ties are controlled by as many as
because the engineers: and tech¬ 10 or 12 holding companies. The
nologists who conceive and supply properties of one system are often
the method of operations of our separated by the properties of an¬
industries have deep interest jn other system, with the result that
the development and maintenance the power requirements of many
of
prudent corporate financial areas are not planned or served
as efficiently and
4!
policies.
cheaply as basic
The growth and the develop¬ economic, conditions fully realized
.
Assets
Deposits
page
operating
am
try ! in
America represent; an
unparalleled achievement from an
engineering standpoint. It would
be presumptuous Of me to suppose
that I .could describe those ad¬
vances to you.
They are the ac¬
complishment of the men of your
profession and, have been set
Bank and
Earnings
^
I
structures;
ment of the electric
the second ratio is
approximately 10 % lower.
Royal Bank of Scotland
■,
Service to Dealers & Brokers
Special Bulletin and Booklet
Thursday, December 28, 1944
Time is. running on those
It may be sup¬
posed that the stream of applica¬
tions
bv
holding companies to
and
now
give effect to the terms of those
perhaps
orders will continue arid
ress
me
integration
of
holding
company
the Federal Power Commission in
story to some of you I would like,
because" others of you may not
shows
the
service
vested.
Let
me
summarize
a
fev
in volume. From the prog¬ of the more important cases t(
to
sp far made, it seems clear to: illustrate
you
the practica
that the end of the' job' of operations of the statute in thi
systems is in sight.
which
The list has expande<
considerably since then and at th<
end of June, 1944, 266 separati
companies, with total assets in ex
cess of $3% billion, had been di"
grow
A casual glance at the National
Power Survey Map, published by,
1935,
companies.
Even
,
•
though it may- be an old
.
of divestment of propertie:
by. holding compapies.
In No!
vember,
1943,
Cities
Service
way
-
Power. &.
entire
.
Light Comoany sold it
common
stock, interest: ii
give a brief Public Service, Commny of'Colo¬
description of what has occurred; rado to an underwriting syndicati
for $20,453,000.'
Public Servic<
time, will reveal the extent of the under the Holding CdmDany Act.*
scatteration of. -holding ...company The Commission, described 4t' in Company, of. Colorado, with conareas'of the principal electric sys¬
tems in the!United States at*thait
have
heard
it,
to
Volume 160
Number 4346
THE COMMERCIAL & FINANCIAL CHRONICLE
1
sol-idated assets of $105,000,000r in
&
good financial condition, is .now
an
independent operating unit,
and is no longer; subject to the
Holding Company Act.
In Sep¬
tember, 1944, Cities Service Power
& Light Company also sold its
Gas
entire
common
stock
interest
Light Company to - Continental
&
Electric Corporation is
another
mate
j The
industry and engineering
generally have given con¬
siderable thought and study. The
view
has
been
repeatedly ex¬
pressed to us by representatives
of the industry and members of
engineering firms that
service
companies have a real role to play
in the operations of the public
utilities industry after operating
Likewise,
'V
progress
being
is
,
than
dissolve..
the
in
This is
large
so
and
which
pany,
proved, -is
recently ap¬
excellent illustra¬
which
Lighting & Power Company,
total assets of $67,000,000.
in
use
dividend
of
f
Another; method of divestment
;is illustrated by The North Amer¬
ica n Company's distribution of its
v
its own
stock interest in Detroit
Company as dividends to
common stockholders, in
the
years 1041-1943.
The same
holding company is now .distrib¬
uting its common stock holdings
in
Pacific
Gas
&
Electric
Com¬
A somewhat similar method
used by The United Gas Im¬
pany.
was
,
provement Company when it dis¬
tributed its
common
stock interest
in Delaware Power &
Light Com¬
pany. to its common stockholders
in August, 1943.
Previously, in
the same holding
distributed most of its
common stock holdings in Phila¬
delphia ; Electric Company
and
Public
Service
Corporation .of
New jersey to its stockholders as
March,
1943,
company
a
partial liquidating dividend.
Beyond
the
methods
I
have
mentioned there have been others
which
figured in the attainment
Notice
and Continental .Gas & Elec¬
Corporafionf involving, prop-,
pany
tric =
of Texas
and in Kansas.The sale -by-" Illierties in the ..Panhandle
.
corporate
serve
simplification
to carry out
j reduced
will
whether the
of. .service
use
go
com¬
A.''
f
j
or
-
that in our
decisions
Section
under
exercised
have
11
extreme
care
!
we
to
on
External Dollar Bonds of 1944
may
aims.
and
*
.Current /interest cannot
Aside
PlaitB;under the
yy
nificance of this program,
say a
>matter of
deep
ures
few
The'
and
their subsidiaries.
pany
$6,000,000,000 of securities of
registered holding companies a id
The major part
of this financing was for, refunds
State of San Paulo 1% of
State of San Paulo
services
to
standards
modification
contracts
which
lion
In
a
number
6% of 1928
The National City Bank of New York
The National City Bank of New York
of 1928
Bankers Trust Company yy
7% of 1927
White, Weld & Co.
6^/2% of 1929
'77
1
■
of 1922
as
r-
Brown Brothers Harrimari & Co.
(Federal District)
;
1922;
.
,
!.;,
J
7
,
City Bank Farmers Trust Company
,
;
„
v
Corporation
Ljadenburg, Thaimann & Co.
.
•;
of thbCitypf New York/;
First of Boston I n ternational
.
City of Porto Alegre 7 Vi % of .192 6
City of Porto Alegre 7 % of; 1928 dy
The "Government has
7
-
.
The Chase National Bank:.';;:
;
City of Sao Paulo 8% of 1922
or
r
Brown Brothers Harriman & Co.
"
jCity.of Sao Paulo.6,1^96 of 1927,.
City of Porto Alegre 8%
t-
yfy.
White, Weld & Co, and
V.
-
'
'*
White, Weld & Co. attd
t
:
'
the City of New York
Dillon, Read & Co.
;
/;V'.
:;;;
City of Sao Paulo 6% of 1919
cases
effiV,
- of
■
Halsey, Stuart & Co. Inc.
(Federal District)
was
,f
v.
^
The Chase National Bank
City of Rio de Janeiro 6V2 % of 1928
»
'b.;
;
7"'*, 7
City Bank Farmers Trust'Company
of 1928
"t; •;
'
.
perform ->
v ;-.
City of Rio de Janeiro 8% of 1921 '
(Federal District) ' - ' ;7..
.and: thus passed; oh "to
earinot
'
Wl% of 1929
in
^hioh. the operating subside
City of New York
6^% of 1928
State of Santa Catharina 8%
of, the
of
,
White, Weld & Co.
State of Parana 7 %
•
.*
Ladenburg, Thalmann & Co.
Ladenburg, Thalmann & Co.
The Chase National Bank
•
ithe. operating: oompanrcsl ; The; utility subsidiaries
regist^ed. holding., .companies Commission, has; also- ruled- -that
their ^property; ac¬
each service company ; should con-'
counts by.more* than t $500-00(1^00
in the seven years ended Dec. 31. jfinf itself, to functions .and serv-,
aCes
of 1926
State of Rio de Janeiro
the. operating
ianes
J. Henry Schroder Banking Corporation
of 1921
State of Pernambuco
land collateral expenses of holding
•
J. Henry Schroder Banking Corporation
J. Henry Schroder Banking Corporation
-
6% of 1928
State of Maranhao 7%
wrote-down
bois' Iowk( Power Gpmpany of its
33ds%Mones .Electric 1942.; -Hie process, has< cr. ittnued
since then at an. accelerated rate
light / Company and - Iowa Power
;
,
State of MinasGeraes
Commission has stated the
principle that the compensation
of"
1926
J. Henry Schroder Banking Corporation
'
State of Minas Geraes
;the
program.... In; this connection; •companies
7
;
of the
required
were
Company /*'••
State of Rio Grande do Sul
oper¬
-effect; at the time, the statute
adopted.
Schroder Trust
7; 7 "
;
Stateof Rio Grande do Sul 7 % of 1927
'governing
has
7v-
'■■
Dillbii, Read & Co.
City of Rio de Janeiro (•>%• of 1928
Commission
iservice
Dillon^ Read & Co.
;
State of Rio Grande do Sul 7%
Act.
substantial
:
.
■
State of Rio Grande do Sul 8%
ar& expressed
relationships,
•
Dillon, Read & Co.
;
61/2% of 1927
{ Coffee Realization)
"
Special Agents
Dillon*4 Read & Co.
State of San Pai.lo 8% of 1921
in Section 13 of the Holding Com¬
The
f
'
Dillon, Read & Co.
,
State of San Paulo 8% of 1925
years
than
'
Pongress
that
'
::
State of San Paulo 7% of 1930
'
learned in
the course of its study of publicutility' holding company systems
that the system service company
cost.
the;
V>';■'
i•,i 1
yyfy:/
oL192L
U. S. of Brazil 5 % bf 1931 ;
to improve the 'the kind and character of services
financial policies of the operating which may be rendered, the na¬
utility companies.; By' the end of ture and scope of the relation¬
June,. 1944, the Commission had ship, and the methods of making
passed upon the issuance of more reports concerning such services
last
3 Va %.
new
payment at
paid to holders of the original bonds
presented in acceptance offPlan A or
U. S. of Brazil 6 V5 %. of 1926
to the
concern
Title of issues
U. S. of Brazil
ating companies by system service
companies should be rendered at
let me
few words about %the meas¬
that have been taken in'the
be presented for
of the Offer.
terms
U. S. of Brazil 7% of 1922
The non-independent character
Congress.
'
U. S. of,Brazil 8%
]y::y.< //■;
play.
be
until such -bonds have been
service company in holding company systems, its use was wide¬
concluded
the sig¬
offices in New,
City.
:'yy7::,^ Oyyy
Coupons due December 1, • 1944 detached: froin • the
.
.
comment
accompanied by appropriate Letters of Trans-;
copies of the Prospectus contain¬
be obtained from the respective Special Agents
.York
accomplish the objectives of the 'had become largely a control me¬
statute without impairing values. dium and a device to extract from
That is not to say that we can the-operating companies compen¬
create values where they do not sation and payments which could
exist, but it does mean that the •not have been taken off in any
These
job is being dene with careful other manner.
practices
attention to the preservation of were
detrimental
to
consumers
genuine interests of investors and and investors of the operating
the public...
■■
■
; ■'. •,: . •
companies.
Therefore, Congress
Before' I
be
must
Letters of Transmittal and
.
pany -concerns
a
for hie
procedures and
-
:
the Special Agents in acceptance of .Plan A
to
may
of the Government for the several issues at their
pi system service companies; was
It is perhaps unnecessary
to say
Plan B
ing the Offer
because
of . its
subto purely holding com-
did not have free
properties which are unretain-
Bonds forwarded
mittal.
| Competitive forces could not and
able. under Section 11 /(bJT/:^/;/,
Offer
.
1944,
Decree-Laws Nos. 6019 of 1943 and 6410 of 1944 of
;
spread, and the final result was
;the suppression of competition.
■
and
to
pursuant to
the said'United-States of Brazil.
<
I
United
that the Minister of Finance of the
is hereby given
elect. to. accept either. Plan A Or Plan B set forth in the
Holders of Dollar Bonds heretofore made as of January. 1,
to
I frpm the factors which brought
abouts the, establishment of the
.
of
-
i servience
the divestment
,interest'in
to
men
panies, in .the light of the number
may
,
.
trained
Frankly, I do not know
.including Juite 30, 1945,
the-period within which the holders of Dollar Bonds of the United
States of Brazil, its States; (other than Ceara) and Municipalities,
company officers and employees
' and Erie County. Electric' the elimination 'of, write-ups fr.om Imust be borne directly by the
Company,/ There was a similar the plant accounts, either, by • di¬ fholding companies and not be
'•exchange:-of; Properties''.between rect 'write-off or by an amortizar shared by their< controlled service
Southwestern ;Public .Service Com-
of
round.
XEstados -linidos/Jb ^Brasiiy./
States of Brazil has extended
pany
.
There
adequate
were not at that time an
number
an
on
To Holders of Dollar Bonds
a
Act's ob¬
jectives.
These have taken the
form of acquisitions of property ing purposes, to take advantage of
This large
by one! Holding company, system lower interest rates:
from another.
Among mem was amount of refinancing, afforded
the exchange between The, United the: opportunity to improve the
Gas -Improvement Company and financial structures and.policies of
We, like; -the; Statethe Associated Gas and Electric the' utilities.
and; tho
Federal
Company' system, involving East¬ Commissions
ern
Shore Public Service Com¬ Power Commission, have required
of the Holding Company
;
:■■
Federal I service: to: operating, .utilities were
enforcement.
in October, 1942.
techni-,
and
,
;
Edison
indentures
.
pendent company, to invite com¬ District Court for
petitive* bids for a recent issue of This case, as well as many others
bonds, and to select-a Texas bank !Of a similar, nature, ^ Ulustrat.es; the
as trustee under the bond indent ; fact that, with the cooperation, of
ture.
The second Texas example management,
it
is possible to
is San Antonio Public Service .work out fair and equitable plans
Company. The parent, American of reorganization - for the most
It also
Light & Traction Company, sold complicated situations.
the type of case
its common stock interest in this illustrates
in
•which steps taken for the purpose
company to the city for $10,000,-
common
bond
than $68,000,000 had accu¬
mulated, into common stock. An
interesting feature of this plan is
that the notes and debentures will
be paid off partly in cash and
partly in common .stock of the
operating subsidiaries. • The plan j Yet, in mgny'i nstances, the service
as filed and approved eliminated
{company was as much an .instru; the
present common stock- from j fnent • of control and exorbitant
; participation in the recapitalized
! profit as it Was of service and; uticompany.
Our order in this case jfortunately,;;its potentialities of
more
.
fjOO'
of
provisions of the statute
which are perhaps of most inter¬
est to your group are those which
establish standards for the regula¬
tion of system service comnanies
and, in lesser measure, indepen¬
dent service companies.
Service
companies figure prominently in
! the history of the use of the hold¬
ing company form of .organization
in .the public utility field.. The
origin and history of Service com¬
panies was so varied both asl to
their aims and practices thaLgen} eralizations
would ; be ; unwise,
of
arrearages
Houston was no longer sub¬
ject to- our jurisdiction.
Natu-v
rally, we at the Commission were
gratified to observe that Houston,
although it was no longer subject to the Holding Company Act,.
nevertheless chose, - as. an hide- has been submitted- to
-
the
basis.
The
of the Section: 11
of
,
if
company
■
we
an
" parent,
National. Power &
Light Companyr exchanged part
'
operating
this
/;;. /./'■7•:'■}■' ■ 7•',';f'//; J'v-;; utility industry today is in the
reorganization plan ; of strongest financial condition in its
Standard' Gas and Electric Com¬ history,
;v,(7';f
' /-'///v,.;
The
;;
few' companies
a,
cians had been distributed
The
with
upon
technical
'
tion of the
for public distribution, and there¬
In
visions
Share
procedures to accomplish recapi¬
talization, involving retirement of
nearly $60,000,000 of debt securi¬
ties, and the conversion! of $87,000,000 of preferred
stock, on
its own outstanding
preferred stock under a voluntary
exchange plan; and, in May, 1943,
sold the balance to underwriters
basis
companies have been. separated of technicians which have since
period deprecia¬ from holding company- Systems. been trained, would have ex-;
tion reserves Increased by more
Here I. shall address myself to •:
(Continued on page 2815)
;
than $1,000,000,000 and the annual
depreciation accrual increased by
over
$100,000,000. : Substantial
This announcement is not an ojjer of securities for sale or
improvements have also been in¬
'■'a. solicitation of an offer to buy securities.
corporated-in' the protective pro¬
result.
others.
The first is Hous¬
Houston for
wide
a
would have been enjoyed by only
system—American Power & Light j preferred stock contracts.. As a
Company, Electric Power & Light result of these policies, coupled
Corporation, and National Power i with a steady increase in the use
& Light Company—and 10 or; 11 of electric 7 energy, the electric
Company,
interest
Yet
debt decreased
outstanding
by more than $200,000,000. A sub¬
stantial improvement in deprecia¬
tion
policy contributed: to this
with three of
Bond
on
knowledge and know-how which
firms
inflationary items.
total
able
serv¬
utility
gross
billion dollars after allow¬
a
nation of
sub-holding companies
Electric
the
were
ing for retirements and the elimi¬
recting
State of Texas furnishes
stock
ice companies in their early days
was their ability to make avail¬
property addi¬
tions of nearly $2%- billion during
the period and there was a net
increase in plant account of more
achieved in rearranging and cor¬
a
common
Section 11 and Section 13 upon a
one
There
ferent nature...
its
flowed from the existence of
holding company system is one to
two examples of a somewhat difr
ton
resulting from the joint impact of
which the Commission, the public
,,
controlling inter¬
est in the company; and Engineers
subsequently sold that remaining
small: interest.:
Puget, with| "con¬
solidated assets of $.130,000,000,; is
ho longer subject to the Act.
;
^
systems,
1937-1943.
years
within holding company
It is pointed out that
pf the great benefits which
panies
is closely related to the enforce¬
ment of Section 11/ The problem
industry for the
few months ago.
jPuget Sound Power & Light Com¬
The plan became effective
by court decree in September,
1943, leaving the parent, Engi-
;
The administration of Section 13
legiti¬
debt and
reduce
that
question
as
distinguished
from the functions of service com¬
for
:
flected, in the comparative finan-r
cial statistics of the electric utility
sidiary of Engineers Public Serv¬
ice Company, which occurred a
pany,
Service
to
means
economically
and
themselves.
tric and Power Company, a sub¬
in
.
.
cientlyr
cost
establish conservative debt ratios,
The effect of that program is re¬
the complicated capital
and corporate structures of the
various holding company systems,
In a number of-systems there are
which
was
stronger financially holding
companies ; which
are
and better able to seryjeeonsuniers merely
pyramiding devices and ;
perform no useful function. Many
of these as a consequence of pro¬ !
-—r - In April,' 1943, the Commission
approved n voluntary -plan - pro* ceedings under Sectipn. 11 (b) (2)
have been ordered to liquidate or
viding for /the recapitalization of
; peers Public
With less than
original
of Virginia Public Service
Company,
a
subsidiary in .the
Associated, Gas & Electric Com-,
pany system, with Virginia Elec¬
merger
Empire District Electric Company
an underwriting syndicate un¬
der competitive bidding for $4,711,000,v The' company which was
sold resulted from: a merger of
separate operating units in the
Power & Light system. Substan¬
tial contributions by the parent
company; together with operating
advantages aiisrng irom the com¬
bination produced
a
company
;
-
We have also used every
portant instance of integration
resulting- from Section 11 was the
to
-
companies'
studies have been completed.
im¬
example.Another
the
as
•
2813
•
,
.
*„ 1
•
ladenburg, Tlialmahh&Co'.
:Ladenburg,Thalmann^;Co.•
•
appointed^^iilon,,;Reaci
& Co. to make the ^yrnents to.
the holders of the State of Ceara; 8% Bonds of ;1922.
The "offer tq'redeem'
such bonds .at 12'% of; thfeir "principal amount
^ 'not: limited as to time;-
7VJ* Fo* ih? United States-sff^razil7'• .7
Al'yvv^i..vV.v Romero Estellita< * - ; •
.y^y'jyiy,. y
.
?•
•.
7
Delegate of the Brazilian1 Treasury in; New_ "York
.NewiYbrki-December'27,-1944.•
.t-.
•:^
THE COMMERCIAL & FINANCIAL CHRONICLE
2814
left
be
Here Are Some More
Expressions
On Peacetime Training Proposal
(Continued from page 2802)
ernment, which was largely based
on the inadequacy of our defense
for their arguments in ideological
While no One will con¬
concepts.
I think that it is pretty well borne
mitted
in the front lines be per¬
•
tions are often of little value.
'/•
'
•
''■//'•'■
•
:
.
f
.
_
Human Instincts
.
eliminated by round-
expect an abouthuman psychology, and
are going to accomplish
table conferences
face
in
that
we
night what we have failed
since civilization began.
oVer
solve
to
My viewpoint is primarily per¬
sonal, yet I believe that it would
he far-fetched for any individual
to claim the right to speak for
substantial group of the great
unorganized mass of people who
make up the world's populations
and who in the final analysis are
the ones who may be most easily
led into wars against others under
any
fiast, the need for punitive action
against other groups.
It should
he perfectly apparent that neither
Kngland, France or Russia have
the slightest desire to relinquish
their policy of national expansion.
Economic Expediency
that
wars
of
reshlt
direct
are
economic
necessity, whereas, in truth, most
of the wars in the past, as well
fought in the
future, are more the result of
what the warring nation might
t all economic expediency.
A na¬
those that may be
as
tional unit which seeks an oppor¬
tunity for expansion beyond its
oWn domain to increase its sphere
economic
of
finds
easily
domination
-
pretext for starting a war.
a
Vjhese pretexts have been em¬
ployed time and again to justify
the invasion of other countries,
the
seizure of territory beyond
their own frontiers and the ex¬
conquered
of
ploitation
This
be
to
seems
more
...
the
less
it
find
following
period
the
to
necessary
impinge on
For ex-
of. other states.
imipjq, Russia might demand that
the Dardanelles and Bosphorus be
made
is
It
Turkish
from
free
open,
dominance.
not
inconceiv¬
able that the nations of the world
might gang up on our own coun¬
try and, insist that our Panama
Canal be internationalized
and
controlled by
iijan by our
joint body rather
a
own
Government.
«Tqst so long as these and countI
ess
other such issues are at stake
tuere will be a basis
TxS
it
long
for
wars,
and
there continues to be
as
basis for wars no nation has the
right to jeopardize itself by fail¬
ure to train its citizens for such
emergencies
as may
•
t
i
training teaches obedience
and respect for authority.
r
tary
*
Protect Ourselves
another
j
Through a system of compulsory
military training and a highly de-*
veloped navy, this country can
become the instrument whereby
outbreaks of aggres¬
be quickly and
nations
may
throttled.
While we
might like to feel that a coalition
of nations acting in concert might
obtain the same results, the writer
is not naive enough to believe that
effectively
there
of
are
many
nations
the face
on
aren't
who
earth
the
so
self¬
ishly devoted to the aggrandize¬
of
ment
their
own
governments,
they might not use such ari
instrument for personal advan¬
that
tage rather than for the common
good of the world. Therefore the
choice to be
made is whether
or
not we shall trustingly
to
the
collective
might
completely
be
whether
that
submit
other
of
action
of nations whose motives
groups
our
selfish
or
had best make certain
we
ourselves
an
factor
in
deter¬
training
purposes must come
I
;
appreciate the
can
those
who
do
not
time.
As
matter of
and navy
portance
would
a
well-disciplined army
in keeping with its im¬
in
the
not have
world
we
sat by passively
allowed
Japan to get &way
with the things it did during the
and
that preceded Pearl
Harbor.
We invited that attack,
and the war that followed through
many
the
years
supine attitude of
our
Gov¬
peace¬
pref¬
rather
have it.
We
in
are
which
the
HON.
midst
of
a
war
military
of
training for
our boys? I do
not
mean
by
should
not
opinion, this/matter
compulsory military training
t^r^-of-.prefer¬
thing
indulged
it
the
and at the
iest
.:i.;•,!/:■ ..v.;
us
on
in
we are
an
are
live, where property,
better than the average.
v
to
!
mili¬
regarding lib¬
erty, freedom of speech, worship,
ideals do not: exist
of the large countries of
which
etc.,
the world.
short
training
period
of
would
not
compulsory
On
with"
interfere
the
a
other
our
hand,
it
set forth
Dr.
t i
w
h i
R.. Rowland
that Ger-i
military nation and has
all
the cataclysms we are
passing through.
I
Germany is not a commercial or
,
to this
nation—she
is
a
war
of
a
equality
>
: -
*
much larger
a
of
regular
the
the
"
and
and
mental
health
of
our
young;
men, instill in them higher moral
values and greater respect for law
and
order, and multiply their ap¬
of their obligation as:
citizens, civil as well as military-
-V
I
preciation
charles
A.
D,„
training i should
abilities and should
of
flexible.
this
Davis has
view very
in complete agree¬
Doctor
point
of
opinion that the pending May Bill,
H. R; 3947, is
very b a d 1 y /
and
-
Universal
military training
should establish peace and secur¬
ity for future generations of Amer¬
icans and enable the United States,
in!
cooperation with other
peace.
ican reaches the age
when he
may
vote, inherit property, engage iii'
business, choose his occupation,
enjoy social benefits, he will have
their-
/;i'Y
.
Universal
for'
military training
between the
males
and 22
of
appreciation
greater
worth.
of 18
should be integrated with'
ages
their academic education.
any
peace-
nations, to defend world
When every young Amer-'
loving
all
I
oppose
urider
Guarantee Peace
fit
be
At this-
intelligent foreign policy adopted circumstances.
for this country, we might see a ;
I have been
period in their lives it would be;
least apt to disrupt the normal-
among
nations: de¬
velop that would make this com¬
pulsory training unnecessary. At
present I don't see that possibility
and I feel that such training is g
educational and business life.
relationship
we
inclined to be¬
lieve consider¬
q u e s
•'
"•/
;
R.
GOSSETT
til
our:
indulged, we would develop a.
military caste, and that is one! President, Security National Bank,
Sioux City 1, Iowa
thing we want
to evade.
Of;
course, in time of "national emer-i
It has been my opinion for some
gency we should train; however,! time
that
compulsory ' military
I do not see the necessity of going;
training for the youth of oiir coun¬
to the point pf putting the coun-j
try would be desirable. When the
try under a military basis. In any; boys attain the age of 17 to 19
think this matter should years, and they are not continuing
m
is to be successful
proposal must have.the whole-'
hearted
support of educational
eiders.
Education
must accept
inter¬
se-'
military
i g h t
'Consid¬
erably/
•
Senator
Jos.
H.
Ball
no
as. a
part
of
a,
arguments that satisfy me
that universal training is
thinking of the young men of the
nation, from grade school up, to
want
So far-1 have
s«en
training
complete academic preparation for j
a useful life, and the? teachers of'
America-must, help to shape; the
modify our
needs
his
a com¬
he
clearer;
That
For
after
tary training
be.
curity picture
is
period
ponent reserve. .If universal mili¬
t i o n
should
reasonable
raining he should serve in
of: this
ation
national
C.
i
want it or, postponed un¬
In this country, if this were,
event I
foundation
that
kind
personal
it
equality of training lays
principles of a free re¬
help to avoid the
creation of a militaristic spirit in
the United States.
Such training*
will greatly improve the physical,
1
in
peacetime,
:
States and from all walks of life./
tain
and
men
stated
young,
Such
public
for
training
women
very
mix
to
military burden
upon all male citizens will main¬
youths in peacetime, it is my
country, and a definite and
.
tics.
we
v e r s a
both
sound
from all parts of the United
position
ap¬
that
i
indeed
is
tenance of
Oct. 26. While
n
according to their capaci¬
qualities of leadership-
and
Army and Navy, The equal im¬
it is my opin- /
u
ity of obligation also spells equal¬
ity of opportunity among all who
serve, to be instructed and ad¬
and would be preferable, both! in
principle and in cost, to the main¬
"Chronicle" of
ion1
Jr.
Bclgrano,
Col-
h
c
N.
citizenry trained in arms will
supplement
the regular -forces^
peared in the
is
J.
F.
A
Universities
ing trend in living standards'in
those countries, making it: pos¬
drawn
sible for them to pay their .debts: •would
the
todefend
and
of
o n
1 eg e s
ris-
reasons,
as
I
visualise
the matter,
be
through service.
,
Associa- /
sey
ports, gradually producing a1
keeping
with my phi¬
losophy. This
excess
of
citi-
to
solid
his
in
.
believe
countries in
t ic
./ Such equal¬
men
Harvey.N../
the
well needed for the future
male
It
by
address before
training,
are
the
ties
Columbus, Ohio
and
education in
certain disciplines
upon
vanced
Ohio State University,
:/t;
not in
a
at
.
CHARLES A. DICE
The
•
ex¬
is
and
not ;; be / considered
v
present. /
of
of
over,
■'!';/■ should/have
:.
-
Furthermore, I feel that
debtor
tary tactics is
one
go
particularly in peacetimes well, and I am
particularly in times of pros¬ ment with all of its essentials.
perity.
In spite of the splendid
efforts of the Church, these effortsHON. JOSEPH II. BALL
were
not
sufficient
to : produce 4* U. S. Senator from Minnesota
that needed discipline. /; '/,/,./
:
With respect to proposals for
If this country could bring itself
compulsory military training for
to the point of importing from
all
train
in
should
should
pline,
a
boys
ideals
our
be
can
emoc r a
Hull
and
but,to make it
them
Furthermore, I think
necessity to be prepared tq
a
building of youth. ..This country
certainly use a little disci¬
operations.
I
most emphati¬
cally do not;
part of de¬
velopment of
Merlin
long as human nature'is; as. the New Jer¬
is,
namely, have-nots, want
things and are determined to have
can
school
t h e i r
peacetime
Davis
4
it
^11 times.
No ef¬
their country.
one
Must Protect Our Freedoms
As
the
emer¬
not
arms
Hon.
one? / I quite agree with the point of
particularly in the residential sep/, view and the concrete opinions
values
mmmm.
trained in
would be suicide not to have
tion where I
of
z ens
the wealth¬
else will, v I
have a police
city, but I think it
my
se-
tablished
all
would prefer not to
force
The
meas¬
in
obligation
the entire/world.
we are a creditor,
no
States
rest
needed
itch for the
debtor; and I think it is riot only
our
duty but a necessity/ to be
prepared to defend ourselves/arid
protect our property. If we don't
it,
policy.
the
does
d
time return-their
produces
protect
of
that
arid
carry
they
things
same
Furthermore,
duty^of-every citizen
help his" gov-?
nation to
military
e s
country in
which
free
a
ernment in the establishment of at
fense
"/
/..i;//
Rkhard Curt*
Today
capital.
of
,//-/.
Bank,
;of national de¬
of
alone, and let
supply
/ ',
//
Oakland, Calif.
the
gency.
the
to
forpes at the
size necessary.
fective system
debts, and
was
armed
our
_/
is
face
interest of the old world f o r leave
us
far
Technical/
F. N. BELGRANO, JR.
ures
old world
that
in
maintain
minimum
vised
materials to
our
served
left to impro¬
try; we were
busy shipping
the
be
ways.
should not be
coun¬
in payment
argu¬
point, and
seem
United
were
debtor
the
could
curity
coun¬
we
discipline
other
sound
In the
this
try
a
in
history
early
of
of
do
to
with it.
and
President, Central
has any¬
ence
main-*
world1.'
to me far more impor¬
training millions of men
in tactics that very likely would
be obsolete in a few years.
The
one serious question in my mind
is whether by volunteers we can
ness
It
my
physical
be
in
States
the
in
beside
ends
better
.r
hygiene,
ical training
stability
are
these
the United
share in
its
scientific and industrial prepared¬
from Wisconsin
In
do
health
ments
Representative in Congress
would furnish a certain amount of
this that phys¬
"the
~
I do not
ever,
ideals.
necessity
the
why
HULL
MERLIN
taining
not
think the mat-
in many
told at the termi¬
are
we
Schoo
obtained their military train¬
ing before entering the armed
services, and I can see the de¬
cided advantages of the results of
their training::
and
How¬
defend
Bank, Youngstown, Ohio
Shattuck
keep
to
~
it is
President, The Mahoning National
both: attended
to
tant than
thought in my
sons and they
a new
for I have two
I would
erence,
nation,, War is her business. This
is brought
about by the over-s necessity, whether
: ■
training of youth in military tac¬ not.
had
of
compul¬
in
this
a
industrial
tion but that if the United States
ideals
want
military training
country, particularly in
•developing discipline among our
younger people. There is no queshad
This is not
sory
at
J. R. ROWLAND
strong
high school,
training could be given with
their last year of high school. Or,
if they are going on to college
this military training could be in¬
cluded
in
their first
year.
It
would be a great help to the youth
of our country to be taught that
type of discipline, resourcefulness
case,
a
training.
way
this
R. W. COURTS
Courts & Co., Atlanta, Ga.
long run prove more sound.
course would,
of course/ them, I think it is an absolute"
"necessitate
compulsory military necessity for us to be prepared
Such
their education after
and to work with other men.
mining the value of compulsory
military training is the need for
■
for military
from our two
against military training.
am
is
in the
caused
Example
to
schools, Annapolis arid West Point.
I trust you will observe that I
ability to take care
own
adequate for any
occasion. The writer elects to be¬
lieve that the latter course would
of
many
Pearl Harbor
Still
arise.
.
.
need for
definite
of training in which we
have been sadly deficient.
Mili¬
type
a
nation will be the last war. Hence,
present war, even though we may
s.et up some monstrous super state,
it is doubtful whether or not the
anembers of such a state won't
the rights
is "a
there
that
people.
or
inherently basic.
In
ap¬
us
utterly ridiculous. The ab¬
spectacle of a Neville Cham¬
berlain, equipped with a bulging
umbrella, at the Munich confer¬
ence
shows how completely in¬
effectual- any argument ; can be
when -it-is. not backed up by the
ability to take^aetion. *
- ■
.V •
Our own problem in-juvenile
delinquency and unemployment
among younger people, which re¬
sulted in the CCC camps, shows
sor
in the various
conferences and meetings between
the so-called allied powers to in¬
dicate that they are willing to
abandon entirely the standards by
which they have gauged in the
There is nothing
We seem to feel
made
pear
the sporadic
various pretexts.
the
sanctions
economic
surd
Ignored
Right at this time we hear a
/great deal of loose talk about a
change in human behavior and
human desire with regard to war.
Those who believe that wars are
going to be
of Ethiopia arid
and Greece, our
Albania
later
practical considera¬
account
into
desirable,
home
return
their opinion in the mat¬
Basic
ill-fated conquest
tend that ideals are not
their
on
express
ter.
until the boys who
open
now
against Japanese encroachments.
When Mussolini started on his
out that ideals which fail to take
are
Thursday, December 28,4944
the best
this
training
their, education.-
as
a
part
J
(Continued on page 2823)
of
■;
■*
fVolume 163
'THE
Number 4346.
COMMERCIAL & FINANCIAL CHRONICLE
2815
process.
They are be¬
ing reduced in size because they
must slough off
their scattered
shrinking
.
i
holdings;and, their - security hold-,
ers" are;
change
(Continued from
1
or
'administration
contemplated
the
believe there is
I
make
describe
effort: to
no
fluence not permeate
'tionships
•
if
;
of
value
the
is
services
such
In
tested.
'service
service relareal economic
to
be
light of the fact that
companies have
been an
■'important medium for exercise of
"control, the problem of achieving
effective
•an
is
severance
an
ex¬
ceedingly troublesome one. Nev¬
ertheless, iwhere real independ¬
be achieved there is no
can
ence
•barrier in the statute against the
continuation
of
these
enterprises
free competitive
market and selling their services
•'at.arm's length as their economic
usefulness may be demons rated.
While our experience to date ic
insufficient to serve as a ground
■
operating
for
in
a
positive prediction, one or
situations which we have had
a
two
occasion to consider tend to point
'their
future.
The
fhst,
end
really the onlv case of this kind
that
we
have
had
before
us
the
system
Associated
Gas & Electric system;.
In con¬
nection with the Section 11 (b)
involved
•formally,
service company of the
against
the trustee of Associated Gas and
Electric Corporation, the Commis¬
sion in its notice of and order for
hearing tentatively concluded that
proceedings ^directed
(1)
'
Utility
Atlantic
in
interest
no
Corporation could be re¬
Service
the problems
In order to resolve
.
of
by the administration
created
owners
Gil¬
of
available
the
to
ready familiar with
ments
a
their require¬
submitted
was
.program
which resulted in the
a
formation of
independent service com¬
new
by the former employees of
the system service company.
The
ownership of Gilbert Associates,
Inc., the new service company,
was vested in certain of the em¬
pany
company.
This
the
of
ployees
.
new
service
system
company
y'
prooosed to
purchase the necessary office and
'other equipment from the system
service company and to take over
staff of the service
technical
the
When
company.
before
came
the
proposal
the
Commission
it
serious
problem presented, in view of the
•past relationship of employees of
•was
recognized
Associates
Gilbert
ciated
'the
that
one
to
the
Asso¬
system, was the question of
of competitive
maintenance
"conditions in connection with the
-contracts
to
be
entered
into be¬
in
Gilbert
Associates. Accordingly, the Com¬
tween
the
various
companies
the Associated system and
mission set the matter down for a
of
to- the
in
and
to
companies
the
thought they had
found
that
best
interest
as
to
re¬
pendent organization desired.
•Further,
Gilbert Associates,
Inc..
! stated that it intended to compete
in
the
general
market for non-
'
COMPANY
A
•
investors
in
a
INVESTMENT
who
Prospectus
through
Mutual Investment Fund
★
he obtained
investment dealer
may
your
Prospectus
from the distributor.
or
223 Sea! Estats Trust B
riding
holding
NORTH AMERICAN SECURITIES CO.
2500 Rus* Building
the years to come, the
operat¬
in
Request
★
Philn. 7, Pa.
•
1
on
general distributors
Under these conditions
company.
.
FUND
Incorporated 1928
an
speculative- interest
MUTUAL
themr-
•
San Froncisca 4
ing: utili^^
will have a
greater ability to raise equity cap¬
U
on
ever
sound
basis
growing
finance
to
Mutual Funds
and the:
needs;
system was being investors who furnish that capital
by court appointed will receive their dividends di¬
trustees, made it quite clear that, rectly, without being subjected to
administered
:
Gilbert
did
Associates
tain the seeds of
From
con¬
control device.
a
indicationsthese;
all
changes
not
have
been
very " con¬
structive both from the
standpoint
of the former employees who have
able
Teen
to
establish their
own
business in the field of .servicing
the expense and
porting
■ an
-
the risk of
outmoded
good year for most mutual funds—a record year,
for some. Generally speaking, performance has been excellent and
growth has been substantial. Aided by rising markets, the combined
holding-
company organization.
;
Mutual Funds in 1945
1944 has been
sup¬
-
In my view these
developments
pubLc utility field have
real significance for the engineer.
They will have important effects
value
asset
some
the
in
of the
from
the standpoint ol the operating
companies who can now obtain
necessary services in a free and
open, market/
• y.'pyT'; 'y:A%;;
types of companies, and
.
the
At
considered
of
Commission
the
time
due
wnat
10
1 the
and
the
of
disposed
lie
.
position
There
■
is:
of
the
ample
that!
the
cessful
the
as
adoption of construction and
maintenance
budgets
are
when
at
its
Elec¬
and
subsidiary companies, jurisdic¬
tion, upon the request of Standin d
Gas
and
Electric, was re¬
served
by
the
Commission
to
onsider
the
)roblem
service
Electric
company
later
some
advised
were
and
at
it
then
was
of working out
disposition of its service
Utility
Gas
Standard
bv
that
process
public
We
da'e.
in
plan of
a
company.
Engineering
and
Service
Corporation, to that com¬
pany's employees. We have been
recently informed that negotia¬
tions to that end are presently
under way,
and that, the definitive
proposal will be submitted to us.
what
Now,
the effects of
that I have
are;
the over-all program
outlined
to the
what does
and
it
mean
engineer? and the operators
utility properties?
The
the
first
effect
will
be
these
companies
holding
remote
control
and
management to
company
hermit
be
from
;
,
the
local
responsive to the heeds
more
upon
force
a
of
our
conservative
degree
upon
free
based
choice of action
considerations
of
the
a
permit
As
upon
and
ing
your
of the communities served.
More-
corporate
financial policy. I believe you will
responsibility.
better
and
because
orders
They will have
more
attractive
jobs
they won't have to take
a
high-salaried su¬
from
per-management.
Now
let
me
about the
Section
-
say
.«
a
issues,
Head New
to
portfolios
of the
In turn,
nies.
panies
holding compa¬
the holding com¬
had, issued
their
the
have
may
in
reported a changer
signal fror i
We wrote:
Aug. 21
was
indexes
now
and
the
of - them were
pressed and
yielded
investors
in¬
may
be another week
in
trading
the next signifi¬
the
present
are
now
more
conscious
advantages and safeguards
mutual
funds
"outside"
their
range,
movement
should
be
up-'
ward."•/;
(by mitigating
competition)
cant
As
*■
events
have
(Continued
proved,
lh»>
2819)
on page
are
(a) the dearth; of new security
offerings; ? (b) the virtual "ceil¬
Broadway,. New York City, mem-: ing" levels already reached by
hers ol;Je New York Stock* Ex¬ certain classes of securities; and
Manager.
his
(c) the continued shrinkage in the
total
the
vestment.
position, Mr. Parmele has
as President of Williams,:
Parmele & Co., Inc., East Orange,
greater
years,
been spent in the
lie
Oranges, where
is well known.
193,7 he
&
vestment
From
with the
was
Trust
1934 to
Savings In¬
Company,
in
charge of their bond account.
factor
oj/cm
of
importance
perhaps
than
any
thus far mentioned is the action
It is hard¬
of the market itself.
Prospectus
request
upon
betrayal of the industry to
admit that
mutual
funds
do
ly
for
nearly 25
the last ten of. which have
FUND
in
X
.
Another
an
business
refuge
seeking
sound, profitable channels of in¬
over
new
vestment
supply.
Coupled
negative factors has
mounting pressure of
funds
idle
Edward A. Parmele,
In order to take
these
been
PUTNAM
available
with
resigned
a
'
in
better
buoyant,
rising mar¬
Putnam
1944
And
has
been
a
.y
What will 1945 bring?
the
Inc.
Distributors,
State St., Boston
of
year
rising markets.
Fund
50
kets than in dead, sagging ones.
wer
unanswerable
To ans¬
question
first, what about the market? The
deben¬
securities
of
severely -de¬
no
income to
cording to
study prepared by Fj
H. Roller & Co., Inc., Ill Broad-I
who
a
time
this
randum
ages, are
arrear¬
being converted to com¬
so as
to permit once
flow of income to the
stock
again
a
security
holders.
But
what
important, the holding
panies
are
going
is
com¬
through
a
stone
Custodian Fund;)
way,
owned
accumulation of dividend
more
two otT
or
consolidation
Granbery, Marache & Lord, 65
preferred stocks, with their huge
mon
longer-term
point upward. ThiA
preferred,
condition
most
and
would indicate that while them
Interesting Rayon Stock i last time we referred to the Stock
and
common
stock, sometimes in a bewilderirtg
Delaware Rayon Co. Class A Price Trend Indicator occasionally
variety.- Very few of the holding Stock offers, an interesting situa¬ mentioned in this column, was
companies were in good financial tion with an attractive
yield, ac¬
tures,
this short-term
reversed and both thu
shorter-term
Branch in East Orange
direction of
Vilas
New
New
according
on
&
to
a
Hickey, 49 Wall Street,
York
York
City, members of the
Stock
Exchange.
Copies of this interesting memo¬
randum
-
may
firm upon
be"
Request.
NATIO.NAt
Securities Series
:y
Certificates of Participation
Trust Funds
!
investing their capital
had "from
the
LOS
Corporation
BROADWAY, NEW YORK,
1
Series
"National Securities &
L20
followsi
as
B-l, 2, 3 and 4 in bonds
-Nv^:
Prospectuses upon request
Research
I>i
Series
,
K-l, 2 in Preferred Stocks
'■,
memo¬
the situation issued by
I
(Aug. 24).
shorter-term
"On
signal
"nor¬
been
the
down to up.
in¬
Other factors which have helped
the
Mr. Parmele has been in the in¬
comprising about 75%. of the elec¬
tric utility industry, were in the
in
who
Investors
h
ago'
At the time we
popularity of mutual fund
times
of the
Granbery, Marache Co.
of the
When we
began administering the Holding
Company, Act the common stocks
of
utility operating
companies,
to
5, N. T.
'
;
few; words
program.
shares
offerings.
for
- NEW YORK
•
mi
about four months,
ment in the selection of individual
investment firm organized by
him in 1937.
financial effects
11
such
63 WALL ST.
——
shares
which the mutual funds afford.
Parmele
DISTRIBUTORS
clined to rely on their own judge¬
sound
change, will open a branch-office
by increasing the responsi¬ in East Orange, N.
J., on Jan. 2,
bility
and
autonomy
of ' local- 1945,
The office, located at 538
management officials it will pro¬ William, Street, will be under the
mote their self-reliance and sense
fund
responsible
shares.
mal"
Over,
of
part
creased
yours
.
mutual
It is also undoubtedly true that
in
Request
on
GROUP, Incorporated
the uncertainties of the times are
responsibility of exert¬
influence dtp*; insure a
discharge that responsibility.
who
dealers
many
added
have
their lists of
been made in improv¬
ing the financial structures and
policies of the industry must be
continuance 'of
Prospectus
V
sold
not
Group Securities, Inc.
substantial:
by
before became interested in them
that have
like
majority
vast
outperformed the
many
result,,
a
had
^well-being
Groups
A Class el
improved performance has
not gone unnoticed by investment
dealers throughout the country.
expediency which is*compelled
by financial stringency. The gains
the
(Bond)
difficult
it
This
of
have
Railroad
doing.
are
margins.
of the enterprise rather than one
maintained.
the
of funds have
financial and corpo¬
will
of
because
found
1944
averages,
economy
rate, structure which
funds
of
During
ability of any business unit to
adjust itself to the ever-changing
circumstances
m. it
suc¬
equal the performance of
comparable
market
averages.
cramped
the managers. Tne
rests in substantial
'
why
to
convert
to
most of the subsidiaries of
holding
judgment
not
so
steady improvement in the
ber
an
does
is
year
——
A lew years back quite a num¬
soundly and intelligently arrived
sures
Gas
reasons
management job they
more
tric Co. for divestment of five of
Standard
this
for their achievement give?
reasons
ex-<^-——:—
V.,
,
mutual funds have been
companies.)
evidence
routine financlat decisions such
/
..
.
be
may
.maintenance, expansion, pected in 1945.
commercial policies, and the pub-*
One of the major
on
overburdened capital
'structure with its attendant pres¬
olan
industry has risen to within reasonable striking
The results for 1944 and the
.
all
a
distance of the billion dollar mark.
*
.
their
INVESTMENT
both
New York City.
Copies of
them; this, interesting material. may be
;public hearing and made that
As I have said, under the Holding; had from F. H.
^question one of the specific issuesRoller & Co. upon
-to be considered.
At the hearing Company Act, these situations are
request.
at which, of course, other service
being cleaned up.
Complex cap¬
organizations were entiled to'ap¬ ital structures are being replaced
Attractive for Investment
simple
capital
structures.
pear and be hegrd,
it was dis¬ by
Great Northern preferred ap¬
closed that system operating com¬ Holding comoanv debts are being
panies were to bo free to negotiate paid off, risky holding company pears attractive for investment at
quired services from Gilbert Asso¬
ciates, Inc., or any other inde¬
'
equity inter¬
utility industry but
all they had was a
est:: in -the
its
the
.to
COMMONWEALTH
ex-
divi¬
significance
great
operating
selves
ital
of companies into independent oper¬
system ating companies. ' It will release
operating companies if desired the
services of the technical staff al¬
either
liquidating
Associated
the
Section 11 and for the purpose
making
factor
system and the further fact that,
,
receiving,
: ory as.
dends, the common stocks of sound
^operating;companies;- This is a
agerial positions in the Associated
of
tained.
become
who
company,
bert Associates. had been in man¬
size
:
service
to
were
•here except to
particular case, the* fact
of the employees; of the
none
former
it
point out, that the
of-, the operating company
may itself be a major factor—in
which engineering1 and technical
services may properly and eco¬
nomically be furnished to oper¬
ating utility companies by out¬
side service companies.
But it is
essential that holding company in-
system
eventually
this
In
that
area—and
an
from
companies
furnish but a
part of the business of the
organization.;. ",T,U.'ry
'T'l
Company Act, par¬
ticularly
Section
11,
that ' the
•answer will be supplied.'
I
business
that
present
would
•of the Holding
•
was
small
enforcement
and
it
business. .and
Associated
contracted if, the' closed
economy represented by
company systems haa not
occurred;
It is only through tne
'panded
•type of
holding
2313)
page
J*
■•
(14)
BOSTON, 10 Fost Office Square (9)
CHICAGO, 208 So. La Salle St. (4)
..
••
Series
S-l, 2, 3, 4 in common Stocks
t
(5)
ANGELES, 634 S. Springr St.,
■ i-
Prospectus
'•
your
■
be obtained from
local investment dealer or
may
The Keystone Corp.
50 CONGRESS STREET,
of
11
<,
Boston
BOSTON; MASS,.
1«16
THE COMMERCIAL & FINANCIAL CHRONICLE
bility.
MunieipuS IV«ws & Notes
>'
"Possibilities
One of the most pressing prob*;
iems
in
opment
of
Robert
revenue
sources
Starrett Bros. & Eken, and
politan
centers
to
suburbs,
Director
a
result of the failure of the metro¬
which
Conditions
as
S.
are
Corporation.
Neal
Chief
among the causes are the slums,
decayed areas and accumulated
i obsolescence
which pockmark
sponsible
'
lor
substantial
this
areas
trend.
The
developed
has
the
problem
City of New York,
of Comptroller
than
opinion
Joseph D. McGoIdrick, who par¬
ticipated in the weekly
Radio
1
areas
gram,
Others
which
the
on
v'
3-1)137
pro¬
be
be
way
understand.
secondary
a
for post-war
vast
value
Another
in
r...
■
the
ards which have been lowered for
^ s!
the .purpose
prices.
of competitive sales
There is no field where
shoddy
goods
i
,
,.,
any
useful
all in the field,
on
.
.
of
healthy
Cnd
land.:
.
Not
,
The
iheir
appropriate illustration.
seen
allotted
time
serve
It is
then let
gage
or
hoped in the; future to the
purpose
a
trend
adequate
cannot be financed.
tate,
be
name
real
of improved
while only vestefday,
regarded
as
land
should
It
is
further
Hand,
the
ply
planning.
to
is
reports about the imposition
loss, if any* caused to those
provide the; most secure
boom < and difficult pe¬
riods. Furthermore, if the indus¬
mortgage portfolio.
try in which
much mortgage
loss
is
compared with the loss of human'
through
all
we are
so
What
vitally
interested is to contribute
largely
high rate
to the continuance of a
Of employment, it can only do so
by conferences such
as
realization
had of
and how
are
fft&y be met.
Three
,v
hundred
years
.
ago
ilftglish poet said, "We live
:>
.t
that
thUst
the
bar
human
of
an
and
as
fore
York
merchant
re¬
the
of
be
les¬
under-
in
compromise
of
the
of:
grown up in the mortgage
are in considerable
part due
:
ment
and
are
trying; to reach it
li&Os ahd 1840s, is almost uncanny
;'ti any;COSt.jv-,V-' ■
Sft its record of human experience,
human frailties and human reac¬
tions,
similar are they to those
Of our day and generation.: There
IS a stfong: tendency for history
to repeat itself and it is no credit
so
tb the human
race
that this
is
so.
From the* very nature of
a
mort-;
mon
sense
of
the
average
com¬
man
Who is believed to repeat mistakes
ftOt because he is stupid but be£&tise he
is forgetful.
"Lest
we
It
were
is
life
true
sinks
tI
and
beings.
that
..
financing the project.
possible financial
into insignificance as
that
the injury to human
However, the mere fact
such
building - collapse due
inadequate materials and work¬
manship could occur in a city
to
whose
and
building laws
were a
model
guide for other communi¬
ties throughout the United States
was
stop
a
sufficient
to,
make
lenders
and ponder latent risks and
dangers in construetion,
of- safe
rock " foundation
investment. " It should
be not just for the day but for the
entire
period
of the mortgage
duration.:
been
no
All
too
buttress"
often "it
dependable
more
has
as
a
of
safety than shifting
sands; or a piece of quicksilver.
Hence it is thought desirable in
this
conference
sion
and
to have
discus-1
a
reappraisement
of
ap¬
praisal methods and practice.
It is
also believed by the com¬
mittee
that
planning
time
some
this
conference
during
reference should
the
be made
Human
changed
nature
"rom
add
eal
over
cannot
be.
night.
day
the
to
responsibility of lending institu¬
tions
in
giving
assistance
to
architects'
specifications, all;
development or proposed
rebuilding of our centers of popu¬
exist
On
great
the
one
there
hand,
aggregations of
cap¬
ital,
the repositories of the sav¬
ings of millions of people which
must
be
return
lished
mote
in
put to Work for proper
accordance
thrift
this
kept adequate.
these
with
legal safeguards.
funds
,
return
estab¬
To pro¬
must
be
At the Same time,
should
be
used
fori
the
rebognizfed obligatioh to;
commuriities which produced
and saved the funds.' More and
generally by
everywhere recognizing: proper mater la is, an d .poor .con-, •i^'re'i':lrivestbrs.G''ire'' coming J to;
hat there "is a vast field for in-; structron, leads to-deteiioration of realize that the 'soundness of
in-;
nvestors
old
;D. Rutan, Vice-President of
the Bank for. Savings, in a recent
meech before; one of the Junior
^orums
of
the
Savings Bank
-
It is sirm-
discourage¬
the
if
importance of
improvement
Through bitter ex¬
land.
perience
have all learned the
we
tremendous
loss, in
obsolescence,
Through
of
experience
we
that intelligent
learned
thought
from
by the
neighborhoods.
,
bitter
all
values
accelerated
deterioration
have
an
in
municipal
action
through city planning in approv¬
ing- subdivisions... and
providing
"roper and
have
adequate zoning might
thousands of homes
saved
irom
blight and prevented, a mul¬
foreclosures. .,; ;,
:
titude of
Any
'
•
lates
movement
,a:
-
which
stimu-
sizable;;.;-contribution
higher '•.standards
and
•
to
eliminates
long-standing abuses, all without
substantial- change
in the basic
concept, is entitled our
economic
respect
guide-
and-/consideration
for
the
future.
as
fA
a
sound
building, soundly financed, still
inherent
-.
the seeds of
has
premature
decay with consequent
lpss
to the mortgagee and the
community if the structure is not
viewed
m its
setting, as a part of
over-all plan. -There
exists a
tune-worn formula of ;
an
mortgage-
lending not to concentrate in lo¬
calities on the
theory that it is
not wise to have all
one's eggs in
one
basket.
This theory without
adequate community
claiming has
resulted
cise
in
an
control-:
obsolescence
evils.
It
is
inability to
over
and
said
exerr
neighborhood
all
that
attendant
these
the
cancer
same
idly by and see
of obsolescence
eating
aw^y the value of mortgage se¬
with small hope of
halting
curity
it.
It is time that serious
thought
and consideration be
given to this
problem.
;
If
*
mortgage
a
....
lender
t
would
realize that close cooperation be¬
tween*
eral
municipal, State and Fed¬
planning agencies and private
capital
will
result
eventually in
mortgage
security
gone a long
way
in stabilizing the value of
mortgage security.
A mortgage
strengthened
then
he
will-have
lender's
•
foresight needs to
be
sharp; and keen and con stab t to
considerably: to the risk of: the welfare' 6f society which is; visualize fairly the future
estate ownership and mort-j their
mortgage which he puts
source; ' 'Not alone' is there
this well
much
future mistakes which
suitability of
to
proper
lation.
a
investors must sit
,
page investment it is believed that' gage lending.;,
|
minimiim standards of
security 5 Deterioration, of physical strue-i
should be accepted
ture, '. due to inadequate or-im-i
The Spirit prevalent today that [ elligetit competition and rivalry
"h the field of
servicing ;of mort-;
aft Should benefit through the
*ages
which are worth holding
Offers of yesterday and the hope
pnd can only be held through the
th&t this; will come about is based
good will of the borrower;1 'Har¬
Oh Confidence in the innate
and
who
The chiseler
and the cheater are apt. to be with
;o cut-throat methods
brought in
us for some, years to come.
The
ay a desire to put money at work,
dearly everything discussed on speculative builder .and the specu¬
lative owner are alike responsible
he program: today
probably will
prove to be a by-product of an for much of the grief in real estate;
and
^restrained
and
mortgages.
Sacrificing of;
unhealthy ri-1
/airy for loans which blinds the light and air, the lowering of the
ayes of those who may have set
quality of materials, inadequate
or themselves a
quota of invest-1 inspections ss well as 'deviations;
ield
spects
missteps. and" disasters.
The diary of Philip Hone, the
Mfw
or
Many evils which have hereto¬
Limitations
memory
never
mortgage security,
competition, instead of being
ife, proves to be just the reverse.
as
Statute
should
agreements
hen
It
though no
tfUer words were ever spoken.
Yet, viewing history in perspec¬
tive, we realize that they are not
true, at least not entirely true.
Ohe sometimes is forced to think
seems
results
ntegrity
!
team but not the wiser grow."
ItOfhetimes
It
by
However that may be,
quest for. loans, as often
lappens, becomes so intense that
these that
•'
so
itandings.
the^
these obstacles
be
has,.caused
when
what
may
that
security to fail of
purpose?
We are told
competition is the life of
;rade.
sened
th's vast potential market.
There
OOe many obstacles but it is only
it
/
-
full'
that
adequately by reaching down into]
is
'
,
the
mortgage
This is
pattern for the
a
.
press
more
have all learned the
the
.
to losses which will naturally cut
base (down the anticipated returns on a
makes
of
made, inevitably1 will deteriorate
mortgage security."
!
Through bitter experience we
.
in sufficient numbers
any
more
hand with future land
the
necessity
of
in
ment of
.
are
and
use
of regimentation.
sense
-~x
,
ing and
a
constructive
misunderstood word.:
Planning in
the sense of
city orderliness and
mortgage lending is not a blue¬
print.
It, is not planning in the
planned that dur¬
.
for
more
goes
proper
ing the day there will be discus¬
sion of that other by-product of
ui
mai
L-iiiri
k.y-jji uuuci
ujl
only shoiild construction be such v^,-^.^
r]ayS which has generally
as to serve, its Durnose with norj:
x®
x-ul
purpose with nor¬
led to loss,: if not disaster ■—the*
mal depreciation from reasonable
elastic
or
blownrup
appraisal.1
wear
and tear but it should be
(Continued from p'hge 2804 )
Strange as it jnay l: seem,: hard-:
such
as
to
give the purchaser headed men of
good judgment,; the
ready performed oh .mortgages i.uxget" mignt be a good slogan what he may
reasonably expect mortgage
lcndeis
of
Which have resulted in foreclosure for the mortgage business.
America,
v!;. | as to
quality of materials and. have shown that
This
dbd loss as well as inspections of
conierence
they may be
is • made
up
soundness of workmanship.
Any¬
extant
of
mortgage
portfolios
in largely
mortgage
investors.:; thing else would be a disservice hypnotized by a word, the little
word "appraisal," just as the in¬
The strength of a mortgage is the
Which there still exists potential
to tne public as well as to
real;
vesting public permitted itself to
grief, have brought clearly to continuing value of the security; estate and
mortgage investment.
•
be lulled into a false sense of se-1
back
of
it.
executive
attention
mistakes of
Modern
practice
Every lending, institution has:
curity by the word "guaranteed":
the past.
Similar mistakes may Leaves the personal liability of the had its share of
imposition from; in reference to
>be avoided in the future if past oorrower
mortgages. In few
largely one of form
jerry building. The famous Bronx
cases do those leiying upon these
If
experience is appreciated and di¬ rather than one of substance.
case of 1936, involving the partial,
simple word>s go- behind the re-?
gested thoroughly. /
,
1 a mortgage is to continue in good collapse of a
60-rfamily apartment turns and
ask, "How strong is he
In former days the, mortgage standing and the investment re¬ house in course of construction
who makes
the guarantee?"
or
Ifehder has used his resources and. paid in full, as every investor in
which-*disaster
16
workers
"How c ompetent is he who makes
commanding
influence. in
the nopes and expects, there must be were
killed,
and
12
injured, the
no
appraisal?"
Some day some-:
temporizing with the funda¬ shocked -the
hOuse-building industry for the
community
and one
may write a book on the folk¬
security.
This security brougnt about the conviction for
Construction
of homes for
that mental
lore- of real estate appraisals or
must be sound
in* its inception'
Shiall segment of our population
manslaughter of those responsible. of
mortgage guarantees. It will
Which has. needed financing > the and it must remain; sound comIn the course of the trial, which
be-Interesting c ven though dole¬
nensurate with the'unpaid pnnleast.
There are indications that
lasted a month and a half and
ful reading. -Already there is a
this may be his approach in the "dpal balance.
;•
■ ■
luring which 3,000 pages of testi¬
resurgence of interest on the part
future.1
Practically every - other '.t'The quest for good mortgages mony was taken, it was shown
of mortgage lenders, in the whole
successful
industry
which
has jails for ceaseless toil and pains-; that old steel and an: unusually
slibiect of real estate valuation.
dOne
much
for
the
establish¬
.aking investigation. There is no large
amount
of
second-hand
;: The appraisers themselves have
ment and maintenance of a high
jasy way in which to conduct a
bricks had been used, mortar had
much to do in improvement of
sound mortgage business.
Standard of living and a prosper¬
There been mixed which was of poor
technique and judgment and in
ire plenty of unavoidable uncer-r
ous,
democratic
economy
has
quality and there had been lack of
avoiding the nefarious practice of
achieved this result by producing
talnties as to real .estate values, adherence to plans.- -It is - a sad
adjusting; their' conclusions
to
for the masses. Thus far the, con¬ which, make mortgage lending a; commentary
that
despite
rigid clients' wishes.
They will be
struction industry has failed in challenging financial activity. • To building
codes
and
inspections stimulated: to action if
mortgage
the accomplishment of this objec¬
idd any avoidable hazards, to the such • a disaster could have oc¬
lenders demand it
An appraisal
tive.
The masses need the hous¬
•nherent risks will lead inevitably curred.
Little was said in the
with
For
improved
mortgage security.
t
as
values
unrecurrable episode in mortgage
financing history, never again to
be accepted or tolerated.
makes
generally
desirable
ah unfortunate and
respect.
and
mort¬
view
may
which
land
es¬
wholesome,
citizenry.
of land enhances the value of
use
The old days when a loan could
be secured on anything that went
more
and
such
by the
is
contented
lenders
pleasure
will not be built
a
development which
Credit of iinancial institutions that
Structures
Here
an
evolutionary project al¬
revolutionary in its implica¬
tions.
It
is full of hope and
which will not
ostensible
serve
purpose, least of
of improvements
growing appreciation
of this. responsi-
acceptance
mil—
i-
that of public opinion.
a
promise
because they
by-products" of
unhealthy rivalry for. loans is. the
acceptance 6f construction stand¬
opportunity
employment.
of
.,.*•
and
is
most
it be
mortgage finance.
There
,
their
service; may de¬
velop far and wide in the public
strangled by them. :
of
loaningalways
as
large-scale housing devel¬
opment of the past decade both in
its private and public aspect is an
last
'
\
i competition in
a
serious
more
us
are
Telephone
'
RH.83 & 84
j
great many
a
solution, he pointed out,
would
the
devoted to the '
was
or
the
In
Station WMCA
over
13.
of
many
•
interest without jeopardy to in¬
cities, he said, must solve
the problems involved in older ! vestors and without discredit to
Industry Association of New
Dec.
much
rep¬
^
The
Business Forum of the Commerce!
York, Inc.,
stated,
municipal difficulties and
threat to the financial sta-r
a
and
McGoIdrick
troller
RICHMOND, VIRGINIA
well
as
to ciect structures
CRAIGIE&GO.
Bell System Teletype:
has
viduals,
and permit any shaving process
whereby builders have the right
•F. W."
Comp¬
areas,
The social responsi¬
as of indi¬
the sanction of law
bility of institutions,-
or
struction codes let down the bars
MUNICIPAL BONDS
v
blighted
'
closing of
one's
eyes
to
poor
specifications pr deviations there¬
from is stupid business and will
be discussed in today's
program.
If
anywhere -building, and: con¬
Dodge
The moderator was
Becker,
Association
aid
to
reprehensible; practices.
careless and improvi¬
.
Director
W.
F.
CAROLINA
type Corporation.
of these commu-
situation
bility of the
On
Dow
resent the root of
This
in
of
recognition.
mortgage
no
•
means
does so. It is
well for mortgage lenders to be on
their guard in this respect.
The
Thomas
President and President of Inter-
hi'ties.
into
Association
President
condone
NORTH and SOUTH
of
Vice-Pfesident
and
Holden,
and
correct the
largely re¬
to
W.
ever.
However,
dent
Post-War," included
Dowling, Association
confronting many of the
nation's larger cities is the con^
tinued loss of population and tax
>\ 1.-*
VIRGINIA-WEST VIRGINIA
Redevel¬
Urban
Probably
lender ?
'".-.Wire Bids
Thursday, - December 28, 1944
books.*.
He
must
have
of
the
on
his
a".field
of
Vision which is broad^nd distant.
In
the
past
it
has
seemed
as
though every - boom must have Its
following debacle. No boom lasts
neighborhoods and then of areas.; vestments generally has a direct; forever.
However^ excesses and
Every instance of this sort throws; relationship to jthe: attitude. of violent reactions may be avoided
discredit on the future worth of; "debtors toward their
If
"obligations; if men put their minds to it.
what should be the most
houses for sale fit
the pocketperma-j and the conditions' under which;
nent and desirable of possessions
books of those who constitute thb
they live.
Public ' and private
and leads to public as well as
pri-; -morale depends" largely upon de¬ market a recession1 does not be¬
vate problems which - affect the
cent living and working c6ndi-i come' -a " depression.
Building
entire
It is
municipal structure.
-
v.
| tionS
in botteural and urban sec-;
should,- never*,
exceed
demand.
tiuus of our country. This inter-; Occupancy is ihe.keystone of suc¬
Group, snoke effectively on this he who aids and abets an iniquity 1 dependency of factors in our body cess and v of/value]
Unless close
is given to the need and
point.
Here is a field in which. is in effect a partner in responsi- "politic is- comirig-tb have general
a
rule, of ancient law. that
...
„
—
/Volurfte
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 43461
160 v
chasing. power,..numbers of jobs
national income, .etc.,j
but you, I think/ would be even
afforded,
ment
the
on
new
Dairen.-' I
of
astounded
was
the
at
such
have been
results
I did.
yet
and
as
tional wealth
pay at its lowest.
What do
these
of course, in its
simplest form is easy. There was
no road machinery
in Greece or
The
answer,
our
use
were'
there
,
in
either of these. I mention
capital,
capital
that
mean
which
by
which
multi¬
the
this
.that
with
-the
raising
.skill,
on
our
-
use
or
be wrong.
conditions
States,
as
estimates
in
necessary
of
the. United;
and
as
economy.
quite blunt in saying
that I am not solely and primarily
interested in living standards nor
I
hard
more
not
have
wasted
We need, I believe,
thinking
based
on
time.
your
prosperity, as desirable as these
and as hard as all of us who
in a leadership position in the
shall
I
think
We need to work out
rather than to
are
skepticism.
evident
is
>
them.
Vice-President; H. M. AitHeights Saving & Loan Co.,
Second
Vice-President;
Charles
H.
Heintel, President of West
Side Savings & Loan Association,
Third Vice-President; and Paul L.
in private
required
conditions
,
for
a
and reasonably- stable
economy.
Despite all this/when
we
as
good citizens strip our
thoughts down to what I term our
prime objectives I think that all
of you will agree that the main¬
tenance of the maximum degree
of individual liberty is after all
that which we seek for ourselves
and for all others.
At the same
time we should recognize that the
use of capital
and labor and, of
course, all of the other productive
forces such as invention and man¬
000,000 per year;.i.e., 25%. The
relative prosperity and depression
of the two periods, when, consid¬
ered against the figures which I
intertwined as to
since, of course,* there, were many
differences as between the two
dynamic
•
agement, are so
There is,
I
one
approach
which will, solve the problem and
that approach lies in what our
a
form an in¬
have just mentioned,
speculation.
I do not
to indicate that the situa¬
teresting
common
decades.
What I do believe very
specifically, however,,is that unless
are going to rely on a greater
we
of
bullish rather than
a
their
capital
pessimistic.
production may be greatly accel¬
erated as vast funds for invest¬
ment plus Federal credit become
•
It may be more
diffi-
safely in the
than in the past.
:
",
;
to loan money
future
and
learn.; Every
boom
must, have
its recession.
Even so, the task of providing
We
live
.
.
higher living standards and decent
housing conditions for* America is
-stupendous in size.
It is believed
of
St.
_.
elected..
than men who
In this there is
are
no
icy, I must at this point mention
a
governmental
agency
'which
part, i.e., the
Securities and Exchange Commis¬
play
may
large
a
If that
sion.
body continues' the
attempt to extend its function and
in
fact
its
thus
and
control
dis¬
living.
debt
In
any
case,
be
must
Government
considered
dead
a
weight in that it "has to be paid
by taxes. The only alternative to
this is in the case, where debt is
wiped out by inflation.
The rank
injustice of such a process, espe¬
cially
to
the older men
and
women
of our
population is, I
think/appalling to
everyone.
The second superficial
and yet
thoroughly dangerous idea is that
the
flow
of
purchasing power
In
this
a
.
-
myself for
speech, I have discussed with
order
to prepare
bankers and
number of
mists
•
/ their
oh
views
econo¬
capital
period.
man
has
formation in the post-war
Quite
frankly,
enunciated
each
different
and different
assumptions
conclusions.
There
have
which
for a
decade and which, judging from
many
public
statements > of
Government officials, economists,
plagued
us.
-ence
It is honed that
may
help
us
Savings
the
by
by Government and, furthermore,
ciations
insufficient
general public
and loan asso-
creased
that when there is
an
York
New
of
in*
State
$61,574,200, equivalent to
13.9%, during the first eleven
months of 1944, it was announced
on Dec. 21, by Zebulon V. Wood-*
ard, Executive Vice-President of
the New York State League of
Savings and Loan Association®.
According to the announcement
the bulk of new savings is being
invested by the Associations in
nature of capital funds is to
seek shelter in a storm,- and useful
23.1%
employment in fair weather,
From' the
very
better
.
for. all
-
of
v
us.
Of
the
course
businessmen, labor leaders, writ¬ •this is so because capital is but a
.and
commentators,
will,1 1 tool of human
beings and, there¬
ers
formation
which
sing and which is
we
discus¬
.are
vitally
so
neces¬
sary if we are to have a dynamic,
progressive economy. The first of
ideas
these
public
that the
is
debt
extent
of
unimportant,
is
§ince after all, it is internal/ i.e.,
we
owTe
it to ourselves.
The only
of true value in
shred
this state¬
ment resides in the incontrovert¬
ible fact that it is better that the
debt be held by our
citizens than
by foreigners.
We thus avoid
such a broad question as the effect
of the export of money for pay¬
On the other hand, in¬
ments.
ternal debt is
a.
burden
produc¬
on
follows
fore,
the
basic
and
un¬
changing nature of man, which is
to
protect
his
only himself but
■
;/V/- / ■ ;';
not
possessions.
I
have
tried
to
state
the
fore¬
going erroneous thoughts clearly
and dispassionately, together with
at least some indication
of the
effect
such policies.
of
sential,
I believe,
It is
that all of
es¬
us
it
represents
Bonds
force.
on
a
no
productive
mill
or
factory
should be
T would be
an
utter fool
Sometimes these expenditures
for;
experiments ..whTh
freedom and impede the
.
are
imrwni
operation
of the economic system bv which
the
American
people
earn
their
beginning
of the
November 30th/
on
advices
we
also
November, 1944, totaled $7,652,261, which represents an increase
of 491/2%, or $2,534,309, over No¬
vember, 1943.
$6,833,844 of these
loans were " for the purchase
of
homes, $471,637 for refinancing,
$126,813 for repairs, $20,744 for
construction
and
$199,223
for
other
loans.
"Total assets of the savings
reached
associations
in the future will be
devastating. A projection of these
thoughts means that instead of
time
putting
anced
house in order at any
our
when
time
or
conditions
unstable
or
are
all-
on
No¬
30, 1944, according to re¬
ports submitted to the New York
State
League."
j
unbal¬
unsound,
return rather to deficit
vember
and
an
high of $588,455,555
such policies
quote:
/ "Mortgage
loans
granted, by
the 246 savings and loan associa¬
tions of New York State during
loan
a
we
financing,
which not only increases the pub¬
lic debt but brings into being all
(which means living stand-,
kinds of, so-called social reforms
ards) and on opportunity (which
which 1 always, >: and
inevitably,
means
freedom).
The
basic
accompanyi, the
attempts of the
trouble with Government debt is
that
to 28.2%
year
from
increased
has
the
at
continuation of
understand that
tion
-
bavmg' li^ed if I were to attempt to translate
little wiser .this .general statement which I
this confer-have made into an accurate fore?;
to that end.:,//; • cast as to years* ^amounts of pur-:
Perhaps, after all.
be.
Increase 13,9%
in the 246 savings
flow of purchasing
self-liquidating through
profits and are directly respon-:
sible for the buildin gs and equip¬
generally by saying that the, im-:
ment renuired for the production,
mediate post-war period will not
which flows into; the economic
in all probability be so difficult
system. Government bonds/how- i
as the period
which comes after j
ever, represent, for the most part.:
the dissipation of pent-up demand
money
which-, has been
spent
and" pent-uo
purchasing power,1
without leaving any oroduef.ive
the latter, of /which., we must; re- j
force
behind.
Sometimes these,
member, will!be augmented in all
is, however. a similarity of ap¬
proach which I shall classify very
public/
and .learned we may a
N. Y. Savs. Loan Ass'ns
must be controlled and channeled
Government to finance the econ¬
In other words, not only is
involved
the future of the so-
Klapper Co. in Boston
(Special to The Financial Chronicle)
MASS. — S. Peter
Klapper has opened offices at 31
BOSTON,
Milk Street to engage
in a securi¬
ties business under the firm name
of S. Peter
Klapper & Co.
:
omy/.
called
which
just
as
free
affects
enterprise /.system
labor
and
farmers
directly as it affects the
ourselves, '-'for. it is absolutely in¬
we
face squarely
evitable/that
in the post-war
future of America
the basic question of the relation
of the individual to Government.
On
the
of
solution
that
question
hangs hot. only our future pros¬
perity but our. future happiness;.
If this can but be believed/firmly
enough by
few and then spread
a
,
-
folly.
Ve
Savings &
Loan Co., Treasurer.
William A.
McMillen of Cuyahoga Savings &
Loan Co., Secretary of the League
for a number of years/ was re¬
.
ness
1
Clair
businessmen/ but the continuation
action/i and in-.:
of liberty itself, is threatened
J
/telligent interpretation pf ,the nast
want, therefore, to ask .that each
-can do much to prevent the his¬
one
of ; you - /concentrate^,jhis
toric panics /rand: wholesale fqrethought on this essential ipter-;
closures.,It; js believed that in¬
relation of the encouragemeqt of;
telligent planning can. do much to
old private capital and the forma¬
expenditures are for laudable and'
avoid abnormal loss in the mort- probability by the reinstitution in
tion of, new,private capital not
necessary
purnoses. such as the
gage fields We want and welcome our system of time payments for
only with a prosperous society
funds over and above tax receiots
but with a continuation of whaJ
.business/ .confidence,
{Business all .'sorts :of .durable land semi-;
really required to win this war.:
confidence does not mean busi¬ durable goods purchased by the
we and our forefathers
that; ' intelligent
V
V&
bearish
a
ground for argument.T""' /'
our
extravagantly but which usurped financing, which per se is a trend
dictatorship,
we
must
the liberty ofr people who little: toward
understood the eventual result. make our plans for the future
Every potential dictator has as-! so as to induce private capital to
sured improvement for the masses, flow into productive enterprise.
including an increase in the de¬ Not only must we do this but we
must set up a System which will
gree of personal liberty and freegenerate from year to year more
the -demand the danger of over¬ risk capital for such investment.
cult
A
policy is toward,the-maintenance
think, plague us even more in the
mean
future.
They relate specifically to
tion with respect to capital forma-,
the
question of private capital
tion was the only force applicable,
realize that the
available.
Schneller
associations
web.We all
tragedies of Eu¬
rope have sprung from
the ac¬
ceptance of centralized govern¬
mental
power
which promised
form
eac ,ate
power to as¬
turbs the normal process of issu¬
sure living standards at the level
ing new securities, the effect on
shall, therefore/ with
thought proper it is the Govern-,
our
whole economy will be tre¬
ment's function to generate pur¬
regard to capital in the post-war
mendously deleterious.; Based on
period draw your attention only;
this statement, it is to the advan¬ chasing power and to distribute it
to
the .very simple statistics of
in the manner considered socially
tage of the American peopie thai
new corporate bond and note is¬
desirable." This process is the very
the whole status and function of
sues
which
took
place in the
one
which inevitably drives pri¬
the SEC be reviewed by Congress
United States during the decade
vate capital to some storm cellar
and outlined much more specifi¬
of the twenties and which aver¬
and leaves the Government at¬ United States Government bonds.
cally*
In this process,,I.Think,
aged about two ,billions of dollars
tempting to stimulate prosperity This, it is stated, is/evidenced by
furthermore, that issues up to
per year as contrasted with the
through
deficit financing.
We the fact that the proportion of
$1,000,000 should be entirely ex¬
new
corporate bond
and ; note
total resources invested in Gov¬
may rail against the flight of cap¬
cluded from SEC supervision."
::
issues of the decade of the thirties
ital to security as much as we like ernment bonds in savings and loan
There are t\yo erroneous ideas
which averaged only about $500,but the sooner we realize that the
employment after the war, both
by planning their own future ac¬
tivities and by outlining the gen¬
eral
W.
C.
I
dreams.
throughout the nation are doing
their level best to assure an ade¬
quate number of jobs
are:
put on paper the estimates of our
It
businessmen
that
se
ken of
the fundamentals
country must work for
officers
new
First
In addition to the questions of
de¬ national
psychology and tax pol¬
sirable/as they may be in some
instances, will probably in actual
experience prove to be erroneous,
are
.
If I do not do
fact that
the
future
accompanied
our
of productive capital in
I must be
in
Other
Congress does with the tax prob¬
the application, lem plus what our whole national
anything else but get over to your
have
whole
only
t®*
*we\
Grove, president of Second Fed¬
eral Savings & Loan Association,
already said, I can do this psychology.' Men who think that
a
technical approach com-; the future is an
expansive one
prising a lot of statistics, 90% of with great opportunities will act
which would almost surely turn much
.more
aggressively
with
minds
which
applies.
Federal
Loan Co.
.with
civilization, is
the knowledge and skills
based
of
— Charles
executive secretary of
Savings & Loan
Association of'Cleveland, became
president of the Cuyahoga Coun¬
ty (Cleveland) Savings & Loan
League at the group's 44th annual
meeting.
He succeeded William
E. Taylor of Security Savings &
Koch,
First
have
has gone
knowledge and
out to
progress
•
capital to our future prosperity.
the background of what I
In fact, a large part of the
advance we have made, which we
call
use
risk
new
maintain,
to
/"•
of
principle
With
ards.;
;
;/
.
budget will be
CLEVELAND,. OHIO
F;
subject which I am asked
The
.
:
.
.
to discuss today is
well as of living stand-
as
masses.
of
process
of
distribution of its benefits
the
see
capital is en¬
couraged.
This means inducing
corporate expansion through the
use
of present capital as well as
through the accumulation of new
capital.
When we turn from the
corporate form to the individual
we
find that exactly the same
develop¬
ment, not only in total but also in
directly or .indirectly, the
productivity of the individual. It
is important, I believe, to under¬
stand
not
only that capital is
absolutely essential for mass pro¬
duction,
which has made this
.country great -economically, but
national
our
tion
of the world in economic
plies,
must
we
large) and that not only the
America has outstripped the rest
I
used,
are
Savings Loan League
present risk capital but the forma¬
here
that
fact
the
controvert
will
power
care
national wealth was estimated
known to all of you, no one
skills;
invariably move hand
in hand with the proper use of
because they
productive
ing
$353,664,000,000 and our per
capita wealth was $2,880. .Based
on these and. many, other figures
all
probability the technical skills to
collaterally,
of
through
run
I have received,
that our Government is frugal in
the extreme (for even with such
to be
mining machinery at Fushun, nor,
has
the pent-up demand and purchas¬
estimated to be
was
thread
second
.
answers
that is, to afford sufficient
private capital for a reasonably
happy and dynamic economy after
$7,000,000,000 and our per capita
wealth was $330, whereas in 1930
our
population was 122,800,000;
mean?
if
and
.
stories
the
which
ail of the
,
'
is
thought
air-conditioned,
me
What I can, however, give
you
to
streamlined make us conclude with Ovid,
trains
operating • on
the South '"Deadly poisons are concealed
under sweet honey.". /
;
Manchuria Railway, but in con¬
Turning to the question of our
trast to this I could not help but
own history, the trend of economic
be shocked': to find nothing but
hand labor by coolies in the great development is indicated by the
.coal mine at
Fusnun.
There, following figures: In 1850 our
drudgery was at its worst and population was 23,100,000; our na¬
the
Cfasrles Koch Heads
.
foolhardy in. believing
more
(Continued from page 2805)
dom of self-expression,
and busy docks
281
broadly
as
a
concept among our
people, - we have more
than a
fighting" chance for success.
Asfor air of us it is our duty not
only as individuals but on behalf
of the interests we represent to
perienced as; the basic freedoms
stand firmly against those trend®
of religion,
speech and oooor
which we know will eventually;]
tunity, which latter,. of course,
includes the whole concept of nrj-, undermine opportunity and lib-
vate
property. / Let
us
not
fool
erty.v.
;
/;
.
■
.
THE COMMERCIAL & FINANCIAL CHRONICLE
2818
lending to non-Canadian foreign
NEP: The New
It
trade
head of the WPA, writes:1
1
if*.
shall
we
.
further loans abroad
.
.;
.
food,
grown
lor
the
our
to foreign governments
which spent the money in their
own countries instead of in the
loans
If
United States.
The story
adequate to the dimen¬
sions of the world needs for
reconstruction
and
develop¬
ment,
several
of
It
foreign; loans.
a
and loans
investments
as
of
likely
now
abroad
make
ington might be catalogued under
title,
"Scene
in
Sombre
Hues."
Now, rather all of a sud¬
fore,
den, we are hearing from Govern¬
officials on every side that
the
will
be
ought to cast
we
experience
abroad from
investments
abroad
receipts
of
billion
11.8
to
(gross new
Chatfield-Taylor*,
distributed to tne
he
that
states,
mental
sees
reason
.
.
,
in
13.4
! proceed
press,
Income
"no funda¬
why well-
received
payments
of
-Excess
what
of
States
abroad
from
the
United
States
to
an
creditor
active
got
out
what
over
shares.
■'
Fhiaif^ Chrohicle)
s. Qertainly.
But one may won¬
der Hvhether Mr. Chatfield-Taylor
is
LOUIS,
M©;
Ted
—
bectrme
has
whole
a
to imply: that the
seems
United States should forget about
foreign
investments
income
ment
:
/,':;■ !/■'.
.
invest¬
and
divided
are
Commerce
-■
..
,
into
V
hand,
one
vestments
in¬
branch plants
as
We
other.
the
on
"direct"
and
such
then
get this
result:'
TABLE I, ;-'IV.
■/
■;,v-
long-terra-investments .figures
Department
1
investments already made abroad
and embark
vaster
era
"
without
on
::
Item—
' Portfolio
Total
$2.6;
$3.9 K
Net
*4.3
f3.4
new
investments
Total
invested
partment Totals
$6.5
abroad,
1920-40
'
John
new
and much
of
Inc.
recovers
payment on the new investments
either?
The
latter, indeed, is
'was a
—$6.9
$7.3
$14,2
$2.2
$7.2
§$9.4
of
*
bonds
mon-Canadian
of
1920-40, inclusive
6.0
7.9
13.9
totaled
"got
$15.1
$8.2
out'
$13.4
$23.3
Exc.
"got out'?
amount invested-
over
$7.8
$1.3
speeches, magazine, articles
mony,
which
$10.3
^Obtained from Commerce Department, The United States in the World Economy
Table III, by adding new issues for foreign account minus the " suit
receipts from foreign countries and net transactions in outstanding
securities.
1
■
I-
foreign
,
fFrom the same source, Table Ilf, direct investments, net flow.
For explanatior
difference between this figure: and the $6.9 billions total. of the Commerce
the
Department, see footnotes 1 and 2.
,■
$The explanation of the discrepancy between this figure and the $6,9 billions shown
the
Survey of Current Business is not known
to the writer and he therefore has
way of further checking the breakdown against published sources.
In any event tho
difference does
§The
invalidate the
not
conclusions of this article.
figure of $9.8 billions
although the 1919 figure does not.
Survey
apparently
includes
short-term
In
I the last column
Table
Department
"direct,"
mere
$6,000,000,000
subscription to an in¬
ternational Fund and Bank as
American
just
street
step
down
a one-way
of 'Tending"1 contrary to the
one
lessons of experience.
breakdown
figures.
The first
of figures show the
into
using
partment data
or
"portfolio" and
Commerce" De¬
its
sources
not
specified in the Survey of Current
Business article.
This analysis
shows
us
that:
(1) The total net return on our
long-term investment experience
the 21 years, 1920-1940, was
over
,
re¬
peats the already-cited Commerce
greater setting tends to absorb in
its stride the Bretton Woods pro¬
a
The effect of the coordinated $1,200,000,000 smaller than the
ctkrent propaganda for new for¬ Survey article reported: $9,100,t
investments,
ableness" of
our
total investment
experience.
.
Here
-yB-
Since the
turn
what
is
we
find:
Our
total
foreign long-term invest¬
ment during 21 years yielded about
4.1% per annum.
Actually, those
investments
be
as
a
whole could not
time
in the foreseeable future.
They
are not "yield" in the usual
in¬
repatriated today,
vestment
•
of
our
or any
supporter that it is
ijotj
necessary for us to know,
When making foreign investments,
how or even whether we shall be
repaid.
The
important
point,
rather, it was explained, is that
through new foreign investments
and
the
consequent exports of
per annum
investments
was
"got out"
accounted
and
only to a minor extent ($1,300,000,000) from investment in
securities.
The
governmental loans, in¬
cluding pre- and post-armistice
war
debts,
are
of
course
in
a sep¬
arate class.
Let
Magazine,
Oct.
us
analyze the data
a
bit
3, further in Table II, so as to ex¬
press in percentages the "profit¬
period 1920-1940
includes the Canadian
obvious that
we
bonds, it is
should; take with
grain of salt the Commerce De¬
partment's conclusions;, arrived at
after viewing the,;"substantial net
a
return
press
as
.
a,.whqle"
Cbatfiejd-Taylor's
statement Informs
was
that
us
maintained, through¬
the
depression oh approxi¬
two-thirds of our total
foreign bond holdings/ the reader
will now appreciate: how much
out
mately
.
to do with • the record.
In
this
have
investments
Canadian
our
connection,
1943
debt service
less
on
the defaults
the
latest
total
.
Actual
Average
contractual
:
Area—
Latin
-
,
America-—!
rate
5.4.1
i.23
■
Europe
6.10
0.97
Far East
5.55
2.21
4.13
4.03
5.17
2.22
North
—
America
Total
——
,
The 1940 official
figures, it may
be noted in passing, naturally take
no
of bonds which' gov¬
account
default repatriated
a practice that
speaks for itself,
This explains
ernments
at
in
,
default prices,
the difference between the above-
mentioned
Chat-
Mr.
and
49%
field-Taylor's "two-thirds."
In
article
this
have
we
ex¬
of a number of
current appeals for a bolder in¬
vestment program hereafter.
If
oast history is not totally worth¬
less, these coming "investments"
amined only one
abroad
under
Government's
our
prove
may
be
to
largely permanent exports of cap¬
In the end we may
ital.
It reports that
of
Latin American
were
sponsorship
;
paid irt
was
49%
European.
The aver¬
age actual rates of interest re¬
turn in 1943 based upon the nom¬
inal
amounts
outstanding,
and
compared with the average coh^
tractuai rate due; was reported as
follows:.'
v;
ourselves
is also of interest.5
than
and 44,4%
Institute of InterMti^hal Finance
by
just
console
"We
saying:
planned it that way."
;
>
is
hardly
a
/'"-v.;
■
American
'TABLE II
V",
long-term investments abroad. 1919, 1920 and 1940
(In billions of dollars)_
.
7.2
3.6
$6.5 *
$3.9 •'
$2.6
*1919
Total
Direct
Portfolio
End of
.
15.0 :
.7.8
7.2
-
:
handsome return, con¬
10.8
.
'
$18.0
sidering the risks involved in
long-term foreign investment.
$32.3/
•
l-;i /'
$10.4 •
Remember that the overall to¬
tal in Tables I and II include our
investments in Canada.
Now let us" separate from some
happier
What
November, 1944, p. 11.
3
Foreign
Commerce
Weekly,
July 19, 1941; p. 5, table.
we
Average "got out" per annum——————
Average "got out" per annum as per cent
investment as shown above———
p.
6Dept.
123. ■
$7.8
out? in 21«years (last line of Table l)-.^
"got
—
of Commerce,-/The
■
.
$0.06
—:
of average
.
$9,1 >
$0.37
$0.43
'
1.3%
.
4.1%
5.9%
United Statesjn World Economy, Economic'
Series
23.
■/' ■■
fDept. -of Commerce, TIB No.
,
.
American
1.3%- per annum re¬
during the
largely by direct investments
such as factories and mines owned
of these figures the Canadian and
If Americans are to consider
non-Canadian experience, again
services, un¬
again buying foreign bonds after
using Commerce Department sta¬
employment in the United States
this war, they ought to keep their
will be prevented.
tistics^ At the end of 1940 Some
In short, an
eyes
on
the first, column
of
Ofgainized,
Government - spon¬
Table 1.
2 From Survey of Current Busi¬
sored
"favorable"
balance
of
1
um.,,,,™.
for
American goods and
1944.
Mr, Barry has
individual floor
an
partner in Weingarten & Co.
annual investments review of the
sense.
The 4.1%
whefe'new lend-
total portfolio invest¬
on our
ments
"service
■
abroad.
The foreign bonds and
eign; loans and investments is al¬ 000,000 instead of $10,300,000,000.
stocks we bought produced
on
ready to be noted on Capitol
(2) The
$9,100,000,000
came
the
whole
an
average
annual
.iTili,' where the writer was re¬ chiefiy ($7,800,000,000) as h re¬
cently told frankly by one Ad^ sult of the direct investments, yield of only about .!:%•%; which
ministration
as
publiciy'-offered
foreign
dollar
bonds (including the Canadian).
Of the total outstanding, 41.3% of
actuality.'' vJ;. -; J;'
an
comes
Whereas Mr.
two columns
for
here
borrow
Economic Series 23,
of
anxiously waiting
now
are
lease contracts end and *NEP be¬
of amortization
and,/.other releases of high Ad¬
ministration
spokesmen.
This
gram
only
total
fault included issues of countries
$23.7
$9.1
1940
$641,000,000 out of
foreign bond holdings of
$3,141,000,000.
Ther bonds in de¬
13.9
rec.,
default in
borrowers not in
$9.8
—;
in
full
were
Those not in default had
The
6.9
.
precisely the sum and substance
of the advice contained in testi¬
w.
Boat- i broker. In the ua^t Mr. Van Raalte
$1,966,000,000.
Of
these, $1 325,000,000 ^y.efe Cana¬
dian bonds.4
■:'r';'■ ^■ >fv/';
to
on
ever
payments
Total
particular
too
it
been active
our
value
our
in
being
Barry, member of the New
Exchange, will form
effective Jan. 2nd.
■
$6.5
$7.7
abroad, end of 1940
Value of invests,
of foreign investment
whether
about
a
com¬
Benjamin Van Raalte and Ed¬
holdings of foreign
partly or com¬
pletely in default on interest.
Another
fraction
of, thg^ bonds
Were being servi«^jr on adjusted
a
down
Commerce De¬
■;
Investments abroad end of 1919
31 %
dollar bonds
terms.
//'■ \\
.
broken
(In millions of dollars)
"■
;
American
how it is to be paid for
The officials of the
Form Van Raalte & Barry
affiliated
\SHh.vthe
previously
was
the
Or
just playing with words.
^does he mean what his speech as
Co.,
Van Raalte & Barry with off;ce$
at 39 Broadway, New York City,
men's National Baixk^.
"
happens to this rather attractive
story when the figures for total
-j • V.
■
Cor¬
&
also visited the trading floor.
pany
with Edward D. Joiiesr& Co., 300
North Fourth St."; Mr. Brucker
the United
put
coun¬
try which is making new foreign
Shields
York Stock
Brucker
!| 13.9.
:
investments."
Shields .and
of
Stern, specialists in the company's
.
"
tion
V.
Shields
and Carroll B. Alker and Louis D.
N. (£^-William II.
Rawls is now with. Kirchofer &
Arnold, Inc., Insurance Building.
1920
^4.———
their two chief components, port¬
folio or securities investments on
of imports in
making no net new foreign in¬
vestments, but; it has no applica¬
nelius
9.8
Without disputing the Depart¬
ment's arithmetic, let us see what
trade must always have an excess
the balance-of-payments sense.
This, he adds, "is
obviously, true of a passive cred¬
itor or 'rentier' country which is
Paul
urer;
as¬
Co., Inc.,
■
.
Chatfield-Taylor proceeds to at¬
tack- the "misconception" that a
creditor country in its foreign
Blyth &
W. McGowan, Vice-President, and
An- i Thomas H. McGowan, Jr., Treasr
St.
1940_
23/
limit, either as to amount or as to
period, and with mutual advan¬
tages.
.
Without pausing to
explain what he would regard as
"well conceived" investment, Mr.
r—
(Special to The Finamual Chronicle)
investments
on
through. 1940
.
definite
without
MI^.
win J.
-What the United States got out:
Value of investments abroad at end
a
conceived foreign investment may
not
with
(Special to The
" 6.9
—;
.
of; Commerce
Undersecretary
,
tained at luncheon N. H. Barrows,
Pres'dent of the company; Edwin
RALEICH,
foreign
of
alluded to.
Wayne
speech
Company, Emil Schram, President
of the
Exchange and Raymond
Sprague, Vice-Chairman, enter-
Northwestern Bank/Building. Mr,
Gasser was formerly'with E. J.
amortization
resales
.admis's**oiji
Dec. 22 on the New
York Stock Exchange of the com¬
mon stock of Wyandotte- Worsted
—6.5
<—
1940
less
dollars
dollar bonds and net
foreigners of 4.9 billion)—
on
securities
MINNEAPOLIS, ;
Billions of dollars-
1919—
1920 through
foreign
period above
of the
records
the
investments
Net new
■
NYSE Entertains
(SpecKI to The.FinaneiaTchronicle)
•;
Prescott & Co.
-What the United States put in:
Estimated investments abroad at end of
artistic
retouching job is being done on
nomic style for us, and an
In the past
Wells-Dickey Co.
Coincident with ;the-
•
..
sociated
had in
with
was
to trading on
thony A. Gasser l^tazbecome
/
investment
post-war
plus
Endicott
; /■ -' <:
*
#PAUL, MINN.—Gerald F.
with ' Merrill
connected
now;
period.
Here is the Commerce
Department's calculation.^
,;J*;..
ment
abroad is to be the dominant eco¬
he
Lynch, Pierce, Fenner & Beane,
330 Walnut St.V-
foreign invest¬
our
connected
■
Co.,
is;' nowv with BParft^,
Shaughnessy Company, First- Na¬
arrived at by tak¬
income payments
as
&
.•
Oestreich
1919
value of
i
G.
CINCINNATI, O.—Justin Meyer
is
ments remaining at the end of the
an eye on
have
we
ceived
the
There¬
become
Kalman
ST.
best
of
has
MINN.—Edw.
(Special to The Financial Chronicle)
.
items with what this country re¬
to
riskier
to
Canada.
than
borrowers
the
persuaded
be
to
Arch
(Special to The Financial;Chronicle) i"
,
investment of the 1920's
it used to be painted in Wash¬
foreign
"bold"
ILL;4wiiliam
investments abroad at
our
end
are
we
Financial.-Chronicle)
(Special to The Financial Chronicle)
available estimates
the,
GRAND
RAPIDS,
MICH. —
(the war debt: Richard M. Gillett has been added
omitted, of course), adding net to the staff of MacNaughton*
new
foreign
investments,
and Greenawalt
&
Co.y"' Michigan
comparing the total of these two Trust Building.
"*
1 -
the
ing
"total"
the
in
difference
of
country itself after this war, such
prominent political topic of dis¬
cussion;
The picture of American
as
This figure is
excellent, which makes a
with
-
tional Bank Building.
from
$10,300,-
investments
foreign
000,000.
record
Generally, the
CHICAGO,
Harding
Building.
Hoisingtoii has joined the staff of
Merrill Lynch, Pierce
Fenner &
Beane, Board of Trade Building.
1940, inclusive, the United
received from its private
States
ex¬
picture.
Since Canada
is ex¬
pected to be a capital exporting
our
once
was
is
lot
investment
our
1920 to
that
demonstrate
to
ures
large investments in Can¬
our
ada
>
of
matter
this
Consider
of
rest
perience.
per
year."
.
the
least
they must be at
billion
dollars
looks very different,
however, if our Canadian invest¬
ments to date are separated from
be
to
:
to get Uncle Sam: to
his hand "boldly" into his
money pocket.
In that article the
Commerce Department cites fig¬
put
ST.' PAUL,
-
(
Co., 75 Federal St.;
(Special to The
calculated
Note the word "total."
loans are
our
&
detail the line of argument
more
MASS J—Frances S.<
Wildes is. with* Frederick M. Swan
"Foreign Trade in
Economy."
There
the reader may find spelled out in
approximately two-thirds of
total foreign bond holdings."
on
(Special to The Financial- Chronicle)-;
"
Post-War
the
believed; that "service was main¬
tained throughout the depression
We should
...
(Special to The Financial Chronicle).
BOSTON,
under the title
investment
our
ycu contemplate making additions to \your personnel
please send, in particulars to the Editor of The Financial
j,
chromcie for:publication in this,column.
for- November
Business
Current
experience has not. been as bad as
again make the mistake of
twenties • when we made
not
of the
Chatfield-Tay-
that
if
.
Vv-,
remarks
Broker-Deafer Personnel liemg
Mr.
quoted statements on the • data
presented in the Commerce De¬
partment's
monthly Survey of
planning of tne
Undersecretary
goods
and
equipment
or manufactured in the
United States.
future
in
economy.
t to
be] used exclusively to pay for
\
the place
take
is to
WPA
make
to
have
fair
is
Chatfield-Taylor based the above-
(Continued from first page)
■
.-"-I' ■'
to assume that
borrowers.
Export Policy
Thursday, December 28, 1944
$Dept. of Commerce,
767, p. 8.
,
Economic Series No, 17, p. 52.
•
ness,
■
4
Includes
$3,600,0001 of
foundland bonds.
*Trwww'
New¬
-V^See
nancial
"Commercial
and
Fi¬
Chronicle," Aug. 24, 194^.
'
policy, must complement and sup¬
The tax must be paid by
of the people who
parties at interest in the
paper.
one
are
business,
(Continued from page 2806)
$140,000,000,000
one
sume
we
more
or
conditions:
ing
ment,
an
must also as¬
of the follow¬
unemploy¬
work week of
mass
average
price level
less than 40 hours, or a
lower, than it is today.
have
It is clear that we cannot
in this country except
conditions
under
than
are
a
we
higher level of prosperity
have even known. There
some
remarkable things
very
present economic, pro¬
ductive, industrial situation.
We
about the
$85,000,000,000 worth
of war production on to a con¬
sumption level that is higher, than
it was in 1940. The elimination of
added
have
production must be followed
"by a still greater increase in the
standard of "living if/we are to
hchieve and maintain a high, leyel
war
In the aggregate,
of employment.
we
have nothing to make up; we
can
fiscal
and
monetary
policies
will' aid, , strongly
in
achieving the? conditions that will
make for high employment.
propriate
most
of fiscal
discuss basic policy
behind
tax
our
this: that
idea
The
taxation.
Federal
the
of
one
parts
important
policy, let usr
for
is
taxation
Since
social
and
economic
acceptable
specific ih^tance whether or not
employment - creating
activities
will be undertaken. However, ap¬
policy should be
taxes should be high
our
enough to protect the stability of
currency,
and
no
higher.
Putting it another way, our taxes
■} The plain fact is that
to increase the standard
if we are
they possibly
can be without putting the value
of our money^ in danger of infla¬
tion.
The loVer our taxes are,
should be
the
left
be
as
purchasing
more
the
low
as
at
be
spent by themrTSr the things they
that
can
jn whatever
and invested
manner
of living
50%—the amount
necessary to sustain a high level
of employment—we must increase
the standard of living where the
living occurs.
This means that
we must have a very substantial
increase in the standard of living
of the masses of the people.
The
over-all Increase required is too
accomplished by im¬
provements for particular classi¬
fications of our people or by feed¬
ing purchasing power stimulant
9t the top and letting it trickle
that private
40%
to
great to be
We
down.
can
and
should en¬
ciple that
should
be
::ou| tax rates can and
atr
balanced
sider
to the point
budget will be
lowered
where the Federal
what
would
we
con¬
satisfactory level of high
a
employment.
" If
we
set
tax
our
rates any
higher than this,
we are
reducing
unnecessarily the
money
individuals -will have
spend and
to invest;
and,
therefore, we,make it more diffi¬
cult for ourselves to get to high
to
.
there.
There is wide agreement that a
employment; .and
stay
to
private investment and
the flow, of savings to investment,
but without large increases in the
satisfactory high level of post-war
standard of living of the masses
ent price f levels of about/ $140,000,000,000, and. so we should set
courage
methods will
be insufficient to do the gigantic
of the people, other
job
that must
000,000,000,,. and not at $120,000,000,000 or some lesser figure. We
1936
had
annual incomes under
$1,650, and though these incomes
are
certainly higher today than
st'll
very low.
Our national economic
policies, including fiscal policy,
including
tax
policy, must be
they were in 1936, they are
tune with the^e
given need not
facts. The reasons
be moral, political, or
social wel¬
fare reasons; they are
quences of inexorable
arithmetic.
do
national
/ The two essentials of
meeting
ments
a
way
policy
provide
the
able money system—a money
tem
are:
the means of
financial require¬
of the Government in such
that we shall have a reli¬
to
first,
monetary
that will give
sys¬
the people a
Stable medium of exchange and
store of value; and second, to pro¬
vide
a
system of financial
institu¬
tions that will give the people a
sound banking structure and a
satisfactory credit
not
want;; our
tax
system
to
work against jus all the way up to
employment —in fact, we
neverrreach high employ¬
high
may
ment if
we
set
our
tax rates too
duced wheroit will
in
good
do
the
re¬
most
creating consumer de¬
encouraging private
mand and'irT
investment:
tbesl
From
principles
specific inferences can be drawn.
First,
no." - general
sales
tax
should
be. imposed.
on
the
burden
a
living.
.
It would be
standard
.
of
■••fT'"*?;-.
Second, all excise taxes, except
those
tobacco,
on
perhans
on
alcohol,
gasoline,
and
should v be
abolished.
a
curious conclusion, the
corporation income tax should be
abolished,
provided that measures
adopted at the same time to
are
prevent the.use of the corporate
mechanism.
form
of doing
business
as
a
de¬
essentials of fiscal
vice to avoid / payment" of indi¬
and monetary policy are of them¬
vidual income-taxes, as a means
selves of the first importance to
of building "upmnneeded and un¬
the
maintenance
of continuing
used
corporate surpluses, or to
high employment under a demo¬
secure tax advantages over unin¬
cratic private enterprise system.
corporated businesses.
,;A
And so the question before us is:
As a matte*3of fact, after sales
What fiscal,, monetary, and tax
measures,
consistent with main¬ taxes and excises, the corporation
income tax*weighs most heavily
taining a .reliable money system
and an effic'ent system of finan¬ on the standard, of living of the
cial ..institutions, would, in ad¬ people, and" at the same time it
obstructs the flow of savings to
dition, promote high employment
investment.
■?"y
under private enterprise?;; ;
These
two
■
We must recognize that a sound
fiscal and monetary policy is not
j.v
necessary
was
all tbree in combination.
the corporation income tax
or
first
imposed
it
have
that an
-may
relations
between
costs and
prices; confidence in been believed by some
the outlook generally for busi¬ impersonal levy could be placed
on the profits of a soulless corpo¬
ness volume and profits: clear and
simole laws and regulations; pro¬ ration, a levy which would be
tection against illegal acts of all. neither a sales tax, a tax on wages,
kinds; fair access-to markets, to nor a double tex on the stock¬
holder.
Obvious1 y. this is impos¬
processes, and to raw materials;
A corpoand
favorable, ter^s on wh'ch sible in any real sense.
loan and eonity. capital are made -atinn is nothing but a method of
available.
The^e, and other con¬ doirg business which is embodied
satisfactory
siderations,
•
determine
-
in
any
in
Words inscribed on a piece
of
to
course
the
The
with
retailing, a large
would go in lower prices,
case
share
and
mailer
as
^hare would go in
higher wages and in higher yield
on savings invested in the indus¬
industry is
If labor in the
try.
strongly organized, as in the rail¬
road, steel and automotive indus¬
the
tries,
share
going
in
higher
If
the
industry is neither competi¬
tive
nor
organized,
regulated—
nor
of which industries there
few—a
Can
The
effects.
bad
are
are
of
part of
a
it
inequitable
is
progressive levy
on
It
they otherwise might be.
duces
the
yield
armual
retirement of a - percentage of
the national .debt, or will we
manage the national debt with
enterprise.
business
\
for" the ^-regular,
ments
reference
some
re¬
Will
4.
we
social
our
building
The
these programs
rent pay-as-you-go
5. Will
policies and,
branches
by broadening markets for goods
and services, will strengthen busi¬
ernment
fiscal and monetary
task
its
for
ness
on
cur¬
a
basis?
Federal
to
no cor¬
in administration, and co¬
Arrangements
tax,, and elimi¬
excises/ will we
put an intolerable
income
poration
have
not
burden
tax?
to
the individual income
on
The
tax
answer
is "No."
which
policy
Under
harve
we
suggested, the individual income
tax
be reduced by ah aggre¬
can
gate of 30% and still 'we can
bal¬
satisfactory
are
for the task that lies ahead?
nate most of the
These five points of/ policy pre¬
sent alternatives that must not be
and
evaded
on
decision
which
some
are
But there
people who want more.
66% top rate is
high and that a $500 exemp¬
tion, for dependents, is too low.
They would use the invisible and
They feel that
a
widespread burden of the corpo¬
ration income tax on the standard
living to enable them to give
alternatively visible and specific
higher exemptions for
and
lower
surtax
benefits that will not in¬
dependents
rates,
crease
the
purchasing
the poor except
third hand.
or
power
of
perhaps at second
.
Personally I agree that for the
long pull and in an orderly world,
the high bracket rate of 66% is
high and the $500 exemption
is too low; But we are not yet in
too-
an
orderly
world.
in
$5/000,000,000
a
reduce rates and increase exemp¬
tions in the individual income tax
to reasonable levels that we
might
live with.
For
the
present I think we
should be satisfied with, a 30% cut
be willing to
in the individual income tax.
should
avoid
the
use
We
of indirect
as
increases and the end of the war
draws nearer.
*
soberly
one
this overall picture,
it is
how
matter
No
views
difficult
than
other
be
to
op-
tomistic concerning the outlook
1945.
if
not better, the record for the
past year.
Combined net as¬
sets should cross the billion dol- "
industry
The
their
equal,
should
managements
And
level.
lar
during
funds
mutual
for
feet
the
on
ground
the future
should more than justify any
reasonable expectations of their
shareholders.
1
their
and
/
eyes
on
Attractive Amusement
For
interested in low*
dealers
priced amusement issues Townsend, Graff & Co., 120 Broadway,
New York City, members of the
New York Stock Exchange, have
prepared
a
memorandum
on
United Artists Theatre Circuit de¬
scribing the activities of the com¬
enced
not know what direction our own
confused uncertainty and we can¬
all, except on a short-
not plan at
time basis.
We
cannot reach
ment and
high employ¬
of
Americans
ing in this country on the basis
short-time
planning.
have
been short-time plan¬
never
ners.
The
settled
nor
country
developed
not
short-
was
by
planners.
The American
ships that sailed the seven seas
were not sent out nor manned by
time
short-time
planners.
Short-time
not congenial to the
temperament
of a people that
want to
build for a long-time
future.
Short-time
plans
and
plans
are
high
employment
are
incom¬
patible.
.
Long-time
decision
ent
commenting on its experi¬
personnel and the consist¬
improvement in operating re¬
.calls
memorandum
The
sults.
particular attention to the build¬
ing-up of values behind the com¬
mon
stock, reduction in funded
debt and extinguishment of over
half
the
preferred
stock
issue.
Copies may be had upon request
from Townsend, Graff & Co,
%
high standard of liv¬
a
require
firm
policies,
con¬
plans
basic
on
Speculative Potentialities
"MOP" general 4s of
1975 offers
interesting speculative potentiali¬
ties, according to a circular issued
by McLaughlin, Baird & Reuss,
One Wall
St., New York City,
members of the New \ork Stock
Exchange. Copies of this circular
may be had from the firm upon
request.
"
New Chauncey
-
Partnership
Effective Dec. 31st,
the present
partnership of Chauncey & Co.,
15 Broad Street, New York City,
members of the New York Stock
which Exchange, will be dissolved. On
We do not Jan. 1st a new partnership will be
formed
consisting of Raymond
want regi¬
fidence in the direction in
we
intend
to
move.
do we
mented planning by an all-watch¬
ful national Government.
But we
require
do
nor
basic
want
formulated
and
policies clearly
democratically
Business wants
a
Chauncey,
Federal fiscal
member
of
Ex¬
the
change, James F. Pierce, member
of the Exchange, William Ray¬
mond,
Jr.,
Madalaine
'
approved.
general partners, and
C.
Elliman,
limited
V
partner.
policy that will help it create good
products, good .iobs, and good
vestments. Business does not
in¬
ex¬
national fiscal policy to do
the work of business for it.,
It
regressive taxation, although it
can Probably be made politically
pect
acceptable.
.... •
It is inescapable that the Fed¬
does ask for
a
taining
a
cooperation in main¬
flow of purchasing de¬
general
eral Government, through
mand that will have some
and workable fiscal
correspondence to what agricul-
r cl^r
and monetary
shrink; and the pressure of idle
should continue to mount
the volume of such funds in-
pany,
should not be post¬
Until we know what
these policies are to be we can¬
of
benefits in
to
poned.
an
substantial reduction.
Competition from new security
should remain unim¬
portant; the total supply of in¬
vestment media (aside from .Gov¬
ernment bonds) should continue
offerings
need not and
$18,000,000,000 budget at individual planning for the future
high employment.
A 30% cut .should * take.
If these decisions
from the present income tax is a
are
evaded; then we are left in
ance
uncertainties
the
of
seriousness
facing the investor.
policy so that we can
have clarity in policy,'consist¬
of -producing
sales tax,
edly increase; and there is small
a diminution in the
fiscal
operation between the execu¬
tive and legislative branches, or
do
we
believe
that
present
no
1945
factors,
a
likelihood of
with
do
ency
have
promises
Gov¬
the
that have
giving the people a place where
their savings can be invested. /
we
is still in force.
other
the
to
As
those
goods, providing employment, and
If
evident at this point that
with
reorganize
we
of
by
will we
system
security
up reserves, or
of our
effectiveness
the
continue to finance
get
elimination of the corporation in¬
come tax from the tax system will
increase
level of
to the
production, prices, and national
.-income?...':
■;
;■
;; ;■/■:■•/.
and obstructs the flow of savings
into
higher
toward
continue
will
levels is anybody's guess, but it
seems
funds
/
«
make'- commit¬
% 3. Will;, we
investment
on
what level?
tand if so, at
in¬
goods and services.
It tends to keep wages lower than
works be designed
to. help-stabilize the operations
of
the
construction
industry,
as
the prices of
out the peaks and
valleys of the business cycle1 or
It tends to raise
dividual income.
works pro¬
be thought of as a means
leveling
will public
"effect*"with
respect to the stabilization of the
and
em¬
possible from year to
Will the public
gram
tax is uncertain in its
dollar,
2.
a-
public
to be served by taxation
not thereby well served.
The
to
cut
high
according to its ability to
induce Congress to tax?
point of view that the
effects of the corporation income
tax
Year,
New
mutual fund shares will undoubt¬
be
rates
tax
year
any
purposes
the
get as much
Will
revenue as
taxpayers?"'" It is clear
only real
enter
we
remaip upward as
they have been since Aug. 21.
IIow long or how far the market
questions
should be settled
These are:
1
tration attempt to
this:
-
As
both indexes
ployment, or will the Adminis¬
to
consumer,
the workers and
investors—who;- after all, are the
market.
continuation of current
trends.
The managers of mutual
fund portfolios may be counted
on
to do a bang-up, professional
job; the number of dealers par¬
ticipating in the distribution of
1.
the
the'
the resumption
the bull market
five basic
are
policy that
without delay.
Is the
corporation a favorable way of
assessing taxes on the people—on
from
course
balance the budget at
The question is
tion.
and
of
corporation income
This really is not
tlpe ques¬
tax?
know that this is true.
we
than
less
than
"next sig¬
has been upward
a
month ago the
Theory confirmed
of the current bull
venerable Dow
are very-
Government afford
the
up
Of
requirements.
speed
There
the stockholders.
give
and
duratiffi
the
But
move"
nificant
suitable for
finally be.
share would go to
large
of
details
the
prepare
longer
anticipated.
of events
will affect many decisions that
some day must be made.
But it
is not too early for the Govern¬
ment to adopt and to disclose cer¬
tain broad policies that underlie
any Federal fiscal and tax policy,
whatever iy
the
details
may
would tend to increase.
wages
"period of consolidation" was of
somewhat
peace-time
dustry is highly competitive, as is
Provision of
peace-time
budget for armament is a symp¬
When peace
The corporation income tax;re-' tom of this disorder.
suits in either higher prices, lower is. at .last organized and this item
can
be cut in half, then we can
wages, reduced return on invest¬
for
attaining high prosperity,* : We ment;
must have government stability; When
the only condition
early
(Continued from page 2815)
em¬
We have been told that it is too
too
Third, and ,to many this seems
at first
high
and
Federal tax measures
the
some
production
high
the money go that is now paid in
taxes? That depends.
If the in¬
V
high.
?
W/ " Obviously," taxes should be
the conse¬
and
tax rates to balance the bud¬
our
get at a national income of $140,-
average
fiscal
|h the United' States
national income at pres¬
a
of the
people are the poor; that in
the families of the country
in
means
Let us
be done.
remember that the. masses
realistically
employment
as
ployment.
will
power
hoipe in the hands of
people—money
-
they choose/ A>:...;;% •/
Now it follows from this prin¬
by
customer,
as
of
maintenance
employee, or as stockholder.
Suppose the corporation income
tax were removed, where would
our
want to buy, or that can be saved
only move ahead.
either
the
in
business
Mutual Funds
activities' of private
plement the
more
or
2819
CHRONICLE
THE COMMERCIAL & FINANCIAL
Number 4346
Volume-160
ture, labor and business are
to produce
and to distribute.
able
<
\
purchasing
demand we can avoid regimenta¬
tion, maintain a high level of em¬
ployment, and raise the American
With such
a
flow of
standard of living to new
+'/-vv
oil
+Vio
noAnlo
heights
THE COMMERCIAL & FINANCIAL CHRONICLE
2820
1941—the
with
Railroad Stocks Should | tion;
Lakes
Great
.
that
carriers
inter¬
some
potential
the
all
credit,
1938
stocks.
and
And
tremendous
a
the
over
one-half years
terest
and
securities.'
bonds
their
and
of in¬
railroad
/:■';%•/
recovery
in
".
tion
The railroads practically rebuilt
been
years
reducing
they,
their
and
and
by capitalizing the
the
new,
old
dif¬
They spent
billion building up this
plant after the last war, and con¬
tinued it until the depression. hit
in 1931.
They invested about $10
about $10
coupons,
coupons
clusive, by about $2 billion.
So there again we are going to
end up when this is all over in a
reduction of $10 billion worth of
bonds to $5 billion fixed interestbearing bonds, and a billion and
a quarter of income
bonds, which
individual citizens of this billion
building
up
the
plant
railroad securities I tried to fore¬ country,-in normal times, got to
which, after depreciation and ob¬
cast at these meetings.- You may the point where we operated on solescence of around $4 billion,
remember that two or. two and those highways about 26,000,000 made a net investment of around
One-half years
ago
I said that automobiles, and if you figure an $6 billion.-,
I estimate today is
// y
selling for, that
railroad
credit
had
been
re¬
average of about $1,000 apiece, it
This
$26 %
billion
is
total capitalization, including the
repre¬
represented a private investment sented; or was represented, by stocks of solvent
established, yet not recognized,
carriers, at about
and in the last two and one-half of around $26 billion.
:■
about $10 billion worth of bonds $10
billion,
;
; ' : "
The trucking
industry in the and about $7 billion ' worth of
years that recognition, so far as
came
in
to
compete stocks.
bonds are concerned, I think; has meantime
Higher Yields of Railroad Bonds
All the; figures I
give
with
the railroads,
and at one you
substantially arrived.
This search for yield that I have
on
the
bond
issues" ex¬
time
I think that over the next 18
they had 4,500,000 trucks clude
equipment, for the reason told about so often, which is now
months to two years the funda¬ operating, and almost a million that I have
as you can see,
yet to meet a railroad
each day going
mental spread
between railroad trailers, representing a private in¬ that cannot meet the interest and more and more into railroad-se¬
and industrial stocks is going to vestment of about $5y4 billions.
maturity of their equipment from curities, that is one of the causes
close.
At the present time, for
Then, too, in the last few years, their depreciation of equipment 'of it; because utilities
bonds, as
example, in the Dow-Jones indus¬ particularly in the last 15 years, cash. In any event, it represented we all know, any of them worthy
we
have
trial averages and the Dow-Jones
developed the Missis¬ a capitalization of about
$17. bil¬ of the name, are* selling to yield
rail averages there is a spread sippi and the Ohio and a lot of lion.
3% or 2,75, and most of them are
':':-;y.-yy;
today of over 100 points.
I am other inland waterways, so that
The Interstate Commerce Com¬ selling at the call price.
Indus¬
excluding the Great; Lakes we mission
going into that in some detail in
valuation, which was used trial bonds are selling to yield
have now about 27,000. miles of in
a
minute, but one! of the things
the rate cases, gave the rail¬ even less.
This vacancy in yield
J am going to try to show you inland \yaterways,in. this country, roads • as of 1941 a valuation of
eventually forces investors into
today is that that tremendous dif¬ representing an investment by $19% billion. But this $26 billion the railroad bond market.
This
ference between industrial prices the Government of about $3 bil- investment which the ICC
fact that you are going to lose half
says is
and railroad prices should close lion.
":/'=V/•'////:/;,/' *:'"/■ worth about $1.9% billion is sell¬ of
the
fixed
interest-bearing
The pipe, line is the. only other
over the next few years, no mat¬
ing as recently as a month ago bonds will accelerate that, and I
ter what happens..
privately
owned
transportation for $10
:
;
can
show it to you in another
billion, represented by the
After all. there are very few industry.
In the last 25 years bonds and stocks, 98% of which
way./-/'/v
there have been built about 126,persons in the room, certainly not
are traded on the New York Stock
We have on the New York Stock
I, who can predict to, you what 000 miles of pipe lines, represent¬ Exchange.
y-Vy|
.■
Exchange/as I say, about 98% of
is going to happen in Europe or ing an investment of $840,000,000,
The capitalization of $17 billion all railroad bonds, no equipments
Greece or Asia over the next few all of which was invested pri¬ was handled
satisfactorily by the but about 98% ' of all railroad
vately.
/:/
years., So, in trading and recom¬
//%/;/... "■ J}/'-'?: ■■■" railroads until 1930, and at that bonds. We have about 585 rail¬
We now have, or did have be¬ time and
mending securities, it has to be
subsequently the rail- road issues on the New York
done relatively.' And, as I have fore the Army took over, 46,000 roads suffered from-this influx of Stock.
Exchange,; including regis¬
done in the past, I say that if the route miles of air lines in ; this
transportation which took away tered bonds as separate - issues.
The
subsequent
as
we,
versus 51.
Great Northern
3%s at 106, versus 69.
Illinois
Central ref. 5s at 95,
vesus 48,
K. S. U. 5s at 96, versus
65.
.
■
.
'
.
L.
&
N.;3%s at 106%,
80.
sus
York
46.
versus
103%,
cific
at 97
Pac.
46.
at
57.
at
Pa¬
Penn¬
104,
ver¬
debentures
at
Southern Railway
60.
versus
101%,
And Tex,50.
versus
is what has happened.
I
picking out the best issues.
,
not
am
Pacific
%,
5s
That
I
/Northern
versus
debentures
versus
am
'/• ' y
at
86.
Southern
4s
58.
104,
5s,
87%,
Plate 4%s at
Nickel
at
ver¬
/'
'
Central
versus
6s
sylvania
sus
91,
>■■>.
•
New
they
will
have, in effect, reduced their debt
over
that period
1942-1945, in¬
with private capital.
98%,
In
ference between the
themselves after the last war, all
automobiles.
excellent
1942, by about $300,000,000; in 1943, by about $700,000,000;
in 1944, and my estimate of
1945,
by taking the actual debt reduc¬
Railroad Debt Reductions
according to the
Public Roads Division, an invest¬
ment of about $20 billion, all pub¬
lic funds, and in the last 25 years
in
prices
with
on
depression,
with
some with fair credit, and
because of loans from the
have
debt.
war.
That represents,
have seen
we
resurrection
of
travel
to
three
the
them
-
too,
but, of course, that is due to the
../A >. V / _'•/.•
V;
about
million
half of which are
macadam or cement, and the bal¬
ance
just good enough, perhaps,
and
last
built
one-quarter
of road,
miles
popular, and I talked about
other phases such as the solvent
more
carriers
and
three
bit
a
have
Government
the
on,
became
.
RFC; in the; last four;
city freight business in-this coun¬
try.
That figure is now up close
to 97% of all the intercity freight,
.
industrially from
railroad securities
of
some
of
80%
(Continued from first page)
survived
their rail-water-rail operaand the rails carried about
,
Thursday, December 28, 1944
picking out junior and senior
bonds
of
what
has
those
That is
systems.
happened to railroad
credit, leaving you only two
large systems, the. Illinois Central
bond
and
the / New
York
.
Central—I
mean
tremendously large systems
—at big discounts, with the ex¬
ception, naturally, of the B. & O.,
which is going through the Mc¬
Laughlin Act.
This
change
in
railroad
bond
credit I have already predicted to
When those bonds were sell¬
ing where they were in 1942, and
you.
lower than that
were
in
'41
and
'40 and
'39, I can remember talk¬
ing to savings banks up here, and
I said, "There isn't a bond that
I am going to mention this after¬
noon that you can buy, but don't
sell what you have."
;
Railroad Bonds Should Be Held v
r
I
said
that
three
on
different
...
.
-
Dow-Jones
;
industrial
averages
country, and up to the time the
Army took over w;e were operat¬
justify their present price of
over 150, then the railroad averagesj should not > be selling
100
points
1941.
If
away.
the
industrial
averages
pot able to
justify, because of
ditions
in
the
generally
world
con¬
the
in
or
are
country, their prices, naturally it
will have
effect
some
railroad
on
prices, too. But if we worry con¬
stantly about what is going- to
happen in Europe and Asia and
Greece, etc.,- and use that as an
useless,
little we
very
because
there
New Competition
The
appraisement
securities
involves
of
railroad
great many
factors, both financial and other¬
wise.
All of you have heard me
a
discuss those factors before.
The
factors are more easily
financial
discussed
than
the
others, but
not going to repeat them.
am
I
I
the
railroad
industry,
not
so
much)from the viewpoint of the
lack? of decreased
transportation
inithis country, but from the tre¬
mendous increased transportation.
In
the
last
25
the
years'
rail¬
vestment
companies
by the commercial air
in the United States
representing
from
which
an
we
have
invested
Guardia
in
have
we
had "tremendous
mendous railroad plant is still by
far the largest'private investment
ihi transportation in this country.
Today the railroads own and have
built1 with
private capital about
230,000 miles of roadbed, and almostf 400,000 miles of track:
They
still'have
about 37!000
of
the
this transpor¬
tation
industry has grown tre¬
mendously, so that publicly and
privately it represents an invest¬
$82 billion,
Now, despite all that increase in
the intercity, ton
about
63%
of
leaves
next
in
my
bination,
not
a
that
most
as
long
as
:
rail.
It
Lakes
is
is
or
on
words, their bonded debt
out
of
the
handled
also
either
rail-water
or
al¬
the railroads, but
pbout 98% of all the traffic
Great
bankruptcy, supported,
said, $5 billion of the bonds,
support it, and they had
$3 billion worth of stock. In other
by
water-rail..
age
In
.
other
words, thev bring, the pre
down;, for example, on .one of the
ore
to
it
passenger
what
roads.,
used to
we
/
'
only
a
It
It
.
didn't
leave
any
substantial protection for the debt.
/'.:
//;
I said, we have 129 selling
discount, about 50 of which
obligations of the New York
will become
selling
The
173.
dnd
about
last 25 years the munici-
paii'tfes; States
Mr.
.
', o
'and ' the
y:
is
v»ars
that
before/the
were
,
Federal 1939 and years that
war,
not
and
in
good, .like
were
fair,'like;
at
discount,' in
my opinion, will be reduced tb 95.
So we are going to lose 45% of
the actual issues, a reduction from
are
a
565 actual issues to 308,
-
So, both
qualitatively and quantitatively
you
are
going to lose railroad
fixed
interest-bearing
bonds
at
| 'i
)<
C
,
>■ i
^
I
t
f
and more
a
In
on
that
Great Northerns and L/& /N. that
are
good in my opinion
as
bash incomes
or
Erie
Seaboard incomes
or
as
Wa¬
incomes
or
St. Paul in¬
v. all
of which are selling
today at large discounts from 100,
comes,
The
last
time I
was up here I
comparison between
the eight largest railroads in this
gave
you
a
country.
We have 137 railroads/
eight of them do/about 40%"
business, year-in and yearout, eight railroads in this coun¬
try. And they also produce about
but
of the
the
net railway operating
indicating that as two
groups they have about the same
quality of management. The firstgroup is the Atchison, L. & N.,
same
Union Pacific and
Pennsylvania. •>/'
like 1941, they had
revenues—thOse four' rail¬
Take
gross
a
roads—of
year
$1,176,000,000.
The next group,
tral,
B.-&
and
O.,
Southern
revenues
almost
New York Cen¬
Southern Pacific
Railroad, had
gross
in 1941 of $1,113,000,000,
the
same
gross revenues.*
And it doesn't vary much whether
you
go
194L
down
to
1938
or
up
to
-,v\
-
Now
originally; this group on;
this group of Atchison,
N., Union Pacific and Perm-country that yield anything, look¬ sylvania, they were called upon,
ing
at
it from the individual to support $1^38,000,000 worth of
standpoint or the fiduciary stand¬ fixed debt and,..furthermore,,didpoint
; ■
;
•
successfully support that debt alii
As a result of this situation you. the way through, the depression,,
now
have,' for example, Atlantic. despite.the lowering of- rates and-,
Coast Line, bonds selling at 98%, loss. of almost 50% of gross rev-,
which.in 1942 sold at 57%; B. &:0. enue bccaUse. of the, depression. ;;
bonds at par., which sold at 52%.
The other four,*-the N. Y. Cen-^
This is only two years ago.
Cen¬ trai, B. & O., Southern Pacific,tral Pacific, 5s, at 98. against .49. Southern
Railroad, they supported the
top,
.
*
»;v;
Big Four 4%s at 87,
the /meantime,
l':
-
)
i
-
J
so.
single bond
I
L. &
time when they are the
corporate
bonds
in
this
m'v.i
con-:
.
,
-
a debt at: the same time, or tried42. to support a debt of $2,657,000,000.:
these other Cleveland Union• Terminals 4%s lYou can-see the subsequent, dif-;
100 railroads in the United States 1 at
;; These
roads,
104, versus 53// D. & H. 4s at. ference.
doing.
stocks.A.,.
*
are
.
-
-—this
in'the
fiduciaries
as
just read you—they are all
selling at- par or within a couple
of
points—there
isn't
a
single
bond on there, with the exception
of the B. & O. first 4s,
possibly
bonds
Now these carriers in 1939, 1940
worthless by the ICC, • and" you
1.800,000 "freight *nd 1941 carried
about 17% of all are
changing this, $5 billion worth
cars!And they have about 40,000
the ton miles transported, inter¬ '•of
fixed; debt to -$2 .billion fixed
locomotives.
This
represents a
city, so that these. two carriers,, debt, a billion and a.
quarter. in-,
private investment of about 26% the Great Lakes arid the. railroads come
bonds; and $2% billion of Burlington 4%s at, 112, against 62,
billion dollars.
' * '
'
cars-
far
income,
,
Therefore, you are losing about
Cj<e^eland; or Toledo, and ship
;$2. billion-worth of stocks, because
to'Pittsburgh"by rail." v" V' _■
they were -eliminated, as- being
;
or
There isn't
list
the very
,
debt of 70%, with stock of
30%.
As
only
call lever¬
You remember Rock Island.
had
carriers like the Great North¬
ern.; to Duluth, take it by water
of proportion to the amount
stock
outstanding, and they
were
rail-water-rail,
was way
refunded
anyhow, let us go back to
sum up.
Out of these 565, the 178
in default: will become 40.
The
258
as' I
months, almost regardless
credit, in the/next 18
two years. / ^
-J-/
the
months
But
con¬
tried to
three years,
Central and Illinois Central.
debt,
Those 37 roads that
above,
disappear
par or
will
or
As
,
of
into
The
by maturities which
by different
or
issues; /
lion in stock.
went
opinion 85
the next two
are
tingent income debt, and $2% bil¬
the
in
changed
either through refunding in com¬
for
quarter
be
will
currently selling at
over
a
a
years
issues, you will have to take
opinion for this, which are
freight transported between cities.
Now, the next largest competition
and
two
into about 40 railroad issues.
are
billion
.
What iS going to happen to it?
178 defaulted issues over the
through
duced to $2 billion in fixed
issues
*
The
these 37 railroads, that $5 billion
worth of fixed debt will be re¬
all
129
.
at
reorganization
of
and the New York Central repre¬
sent about 50%.
'
my
the
balance
a
selling at a discount, of which the
obligations of the Illinois Central
258
the
Now what has happened to this
by the railroads in
of
average
,
gross
of
of
selling above par.
now
ing above par.
258 of the issues
selling
above
par,
which
But, unfortunately for
they, also represented $5
30%
issues.
are
1942, of these 258, 38 were sell¬
$18 billion of capitalization? First,
the years 1939, 1940 and 1941, in
those years the railroads carried
*n
about
are
bond
565; 178
are
billion out of $10 billion of fixed
interest-bearing bonds. The other
railroads, about 100, carried 70%
of the gross business, but only
supported $5 billion or 50% of the
total outstanding debt.
But in any event,
-
issues
In
combina¬
in
next 18
tractive
Of those
ever
them,
Airport.
ment of about
rates
it again, I
wouldn't
sell
a
Single railroad
bond unless it was selling at the
call price,' because I think most
of them will get there over the
say
actually in bankruptcy today. 258
585, 20 are foreign
there are about 565 do¬
so
mestic railroad
creamy
imoortant than
business.
airport, La
one
reduced
sented
taxpayers of New York City
formerly
development of waterways and
highways,
private
automobiles,
pipe lines and air lines. The tre¬
more
the greatest depression
had, could not survive,
y Thirty-seven
railroads V ■ w e n t
into: - bankruptcy,They ,' repre¬
sented about 30% of the mileage,
which doesn't mean very much,
but, more important, they repre¬
domestic com¬
of July 1, 1941,
investment of but
as
there
years,
lot
a
tion with
all
railroads, if you want tg
carried call it that, in volume is,not
th|
practically all the torn miles and' trucks nor. the
waterways, the inf
passenger miles .in this country, land
waterways.
It is the Great
now are only a part of the trans¬
Lakes.
Now this traffic on the
portation industry.
In the last 25 Great Lakes has been
roads,1
away
of those
bonds,
These planes and the beacons that, they reduced the rates.
So
and the airports as of July 1, 1941,
among r these
railroads r carrying
represented /an / investment
of this
$18 billion worth of capitali¬
$516,000,000, but out of that the zation, there were many who,
cities and taxpayers contributed
when
called
upon
to
produce
$451,000,000. The total private in¬ earnings on the bonds and stocks
am: going to try to review briefly:
transportation,
thg; changes that have come about miles carried
in
took
I
cerned, naturally they can decide
then what to do, but speaking for
myself, when a bond gets to a
price where it can no longer go
any higher,; I- will let somebody
else keep it, providing I can buy
some-selling still' at a discount,which, in my opinion, are as at¬
Out
■„
"i the
;
of July 1,
$65,000,000.
:?Vv' .- vVLooking at it from the railroad
standpoint, the total investment
in these 452 planes was less than
is
do to control those world events.
H
as
business, but
represented
individuals can
as
was
mercial air lines
not to do anything in the
securities market,' I think it is
excuse
rather,
That
country.
Dow-Jones
and
the obli¬
gations of railroads in bankruptcy^
of their passenger business.
The trucks operated for almost 20
years
without regulation.
They
most
ing 452 commercial planes in this
can
occasions,
;' t
i
c-
versus
Volume
attempting
.
what
Now
debt.
terest
2321
And as Southern Pacific, South¬
they' Goodyear, from 47 to 15. Inter¬
ern Railroad and the rest of them
26,600,000-shares, national Harvester, from • 120 to
International Nickel, from ^3 go along, they will do likewise.v
Next is the Chesapeak & Ohio; 48,
mon
stock
at
19,
when they
Then
in
your
non-dividerid
Johns-Manville, from 155
Then the New to 36.
handle $100,000,000 worth of gross 7,700,000 shares.
York
Central,. 6,400,000 shares] to 58. Loew's, from 88 to 33. Na¬ paying group such as D. & H.^ it
revenue
as
well, asthe present
has already resurrected its bond
tional Distillers, 35 to 17.
Na¬
Then the Southern Pacific with
management has been handling it.
credit. There is no reason that I
3,800,000 shares. Those five rail¬ tional Steel, from 99 to 44." Procter
& Gamble, from 65 to 39.
Sears, can think of why that shouldn't
roads comprise about two-thirds
Question of Railroad Wages
of all the shares in the Dow-Jones Roebuck, from 98 to 47.
Standard go into the dividend-paying class
On numerous occasions before
;
Oil of California, 50 to 25.
Stand¬ next year.
I have given you my conceptions averages,. The average number of
The Nickel
Plate
has resur¬
of
shares outstanding for the balance ard
Jersey, from 76 to 39.
of the problems of wages on rail¬
rected its bond credit. It had one
-of those 20 railroads in the Dow- Texas Company, from ' 65 to 32.
roads.I claimthat wages will
United more problem to do; the adjust¬
Jones averages is 1,300,000 shares, Union Carbide, 110 to 57.
remain a definite proportion of
which, is a leverage situation by Aircraft, - from 35 to 19.
U. S. ment of its preferred. If it does
gross revenues in normal times.
Westing- that,, there is no reason why that
comparison with most industrials. Steel, from 126 to 36.
In modern times, they always did
In the period 1937 to 1943, in¬ house, 167 to 61.
Woolworth, from stock can't come out of the nonand I think they will. I think that
dividend paying class.
!,
65 to 36.
^,
the present efficiency and pros¬ clusive, the Dow-Jones Industrial
Likewise for the B. & O., D. L.
That is the last depression we
Averages, 30 "stocks, earned $68
pective efficiency of railroads can
had.
What
industry
escaped? & W., Illinois Central and B, & M.
more
than
overcome
increased per share, and paid $47 per share,
The greater your problem, the
or they paid about 70%
of what None of them. • The rails won't,
wages as -they have in the past.
heavier your debt, the slower you
earned.
The railroads in either,. Don't worry about that.
But let me tell you something they
But we have were, the faster you are, deter¬
that period, these 20 railroads in They go together.
about wages.
We always hear
mine the timing.
As I have al¬
got rid of the bankruptcy risk in
the Dow-Jones averages,- earned
something about wages on rail¬
railroads.
That
is; why these ways said, the bonds will tell yo'u,
roads, nothing much about wages $37 per share and paid $12; 32%
as they did in D. & H., when to
was paid out in dividends.
' stocks have never "really recov¬
and the pre¬
ferred, stock at 50,' and the com¬
almost a
fixed in¬
support
to
billion dollars greater in
tjatattulu. t,'js.'lt.wa.
!?«>t.i.i.l..' fc..:—'.-,
COMMERCIAL & FINANCIAL CHRONICLE
continue to sell at 73,
business, and one
about the same
:
THE
Number 4346
160
„,jh ft>6
4 & m'lw '■
w4**tf^wuu>
Dow-Jones averages, because
alone represent
.
hap¬
.
T
pened? ::
their
retained
four roads that
These
:
credit, they were not satis¬
They reduced their
,
fied with it.
debt
,
So they now support
of the 30s.
a
since the peak
$300,000,000
debt of $1,650,000,000.
:
These
What did the others do?
.
•roads, the N, Y. Central, Southern
Pacific, B. & O. and Southern
Railroad, at the beginning of this
year, they had reduced that $2,657,000,000 down to $2,176,000,000,
a reduction of $481,000,000.
: • :
this
Now
.
•
1944, with the
yearv
R, & O. reducing its fixed debt by
$100,000,000
through the
McLaughlin Act, and reductions
,
over
in Southern Pacific and the New
the ■,Southern!
and
Central
York
i'1 !
'"
industries. ' '
other
in
Railroad, in my opinion they will
end up this year with fixed debt
thing, if it becomes
insurmountable in the railroads, it
This
of
wage
$1,770,000,000, which is about
the same as the Atchisqn, L. & N.; is going
Union Pacific and Pennsylvania able
in
In
the
last-year,
1943,
industrial
Jones
averages
Dowearned
$9.66 <and paid out 65% of it.
become insurmount¬
They paid out $6.30.
The rail-!
Chemical' and
road -averages earned more last
supported all during the depres¬ American Telephone and- all the
year than the industrial averages.
sion, never needed or asked for rest of your industries. So if you
They
earned $10.19,
and paid
any loans of, any kind, and,,-as; a are really worried about the wage
$2.63, or about 25% of what they
matter of fact, L. & N., Union Pa-I problem, then
go seek govern¬
earned.
cific and Pennsylvania paid divi¬ ments or municipals or cash, be-;
T Obviously, rightly or
wrongly,;
dends; nearly
every
year
all! cause I don't think in the cor¬ if the railroad averages had paid
through
the
depression.
The; porate field you can isolate the
out
two-thirds
of
what
they
L. & N. skipped, I think, once. ,
wage problem to one group and
earned, they wouldn't be selling
not to the other.
Therefore,
these
four
roads
■'-■■■'■py'Y'v. at 45. Would they be selling at
which have been problem chil-!
Take the airlines that you hear
par?
Then they would be war
dren, New York Central, B. & O., so much about.
The CAB report babies. Would they be selling at
Southern
Southern
and
Pacific
Railroad,
children,
our
for th6 year ending July 1, 1944,
biggest problem compared with that ended July 1,
now
have their debt 1943, all domestic airlines, the
down in my opinion at the end of. revenues were
up $21,827,000, and
this year equivalent to the debt the
operating expenses were up
:that these four good roads, carried
without any
$24,531,000,
\:T■, !
difficulty,
yet
see
the
over to
reflection
the stocks and
the
in
Take the utilities industry.
public
issued
make : money
discounting,
things.
You don't make money;
after, you can
prove,that these
four roads' have got .their debt
down to depression-proof levels.5
Stocks will be
up
where these
;you
stocks
other
that
at
are
time.
Right today the public. evaluates
stocks of the Atchison and;
L. & N. and Union Pacific and
the
The
people
say,
''Well,
Union
Pacific,"
Commission
just
so
worked
you
on
the
others.
railroad
If
you
in
1916,
28 cents an hour,
annual wage of $891 a
received
income of you
and
I will give you
.
amount
for
of
interest,
money
available
and sur¬
an
year.
•
•'
.value of
li. & N, bonds and stocks,
tonight, is about $300,000,000. The
market value., of-the Rock Island
tonight is. about
$150,000,000.
Those are things you have to
discount in advances Rock Island
;
.
income
bonds
are
not going
to
in
the
where you
Dow^-Jones averages com¬
about 66,500,000 shares of
stock, but five railroads make up
44,500,000 shares out of the" 66,-
prise
500,000, and you obviously canrsee
the influence of the Pennsylvania
and the Canadian. Pacific m • the
will
out
pay
There are only five.
nature.
ilar
There
next
the
half of next
T .y:
quarter and the next
year."
r
bond
year
price.
.
at
;
yields.
the
credit
'
;
tonight
averages
that
Now what is next
in the Dow
averages? Great Northerii and Atchison.: Why? Because
Jones rail
,
general credit worth about'3^4%.
Yet you can buy the stock "to¬
night to yield 8%. 5% yield'in
Pennsylvania is 50, and the stock
have
&
;;
Pennsylvania.
Perihsylvania
bond
credit; •is;'" yibldfng
about 3.50%A Their
underlying
credit is certainly worth 3% and
dividends each and every
of the last 11 years,- and they
and L.
-
■
Take
only-five rails, in the
are
Jones
Dow
railroads in paid
greater
look
N.
&
L.
get your bond reduc¬
become
let's
Now
use
That is why you- have
tion.
That figures out around $17
per week, a 60-hour week, a 10dividends
hour day...■■
YYy
plus. of these two sets , of four
If you worked for the railroads
roads.
The amount of money!
available for interest, dividends last year—this is the average man,
and surplus in 1941, which is my; understand, - this is not the engi¬
conception of a normal year in neer; this is the average for the
1.400,000 employees—you
the prospective future, for that5 whole
group led by the Atchison, L. & got $2,605 for the year, 92V2 cents
an
hour, and you worked a 54N„ etc., was $222,400,000, and for
hour week, which is about $50 a
the other group, $223,000,000;
, ]
week.
r
'
While I have mentioned L. & N.i
So don't let anybody tell you
a
minute ago, I can't help but
think that L. & N., with the record that railroads are no longer com¬
it has, still selling to yield 7%„ petitive With industry generally.
with their bonds selling to yield. I don't mean the shipbuilding in¬
3j/2%; it never happened in nor-, dustry, but I mean industry gen¬
mal times and it is not going to erally in normal times.
So we
continue in my opinion.
In other are no longer, in my opinion, vul¬
words; either the bonds are too nerable to attacks by wages, relahigh, or the stock is cheap.
5%
yield on L, & N is 140, and" it
The Dow-Jones Averages and
closed today, I think, around 101.
Dividend Prospects
But I only mention that to say
that I think the stock, in my opin¬
Going back a minute to the
Dow-Jones ,"J industrial
averages
ion, is attractive.
Yet the situations of L. & N. and the railroad averages, which
and Rock Island are somewhat closes today at a spread of over
100 points.
First, the 20 railroads
akin, not far apart. - The market
the
that they
fact
the
ness
period 1937 to 1943.: " That is
the
its
various
and
the second four.
Now
be
multiply $25
you
•
to
prices.
surplus into these 20
,
don't include the other
to
:
•
get rid of that
yields 3%%.' Why?
,
'
which caused and
L. & N. stock yields 7%, 350
created
the
danger
of
bank¬
basic points.
100% difference in
ruptcy.
Y
Y:'"Y ;
yield between the bond and stock
These 20
stocks in the Dow
of the same company. They paid
Jones railroad average are com¬
their
dividend
every
year
but
pared with./ch;e 30 stocks in the
one. r They have
paid their in¬
industrial averages.v: There isn't
terest every year. Now something
a
non-dividend paying stock in
is wrong. It is not going to stay
the
industrial
averages.
f There
that way.
' ;
• .";
}
isn't a stock in there that has not
Five per cent .yield, as I said
consistently paid dividends. They
before, in L. & N. stock is a 140
war are all big dividend payers, wit¬
surplus
bonded debt,
by 66,500,000 shares, and you pro¬
duce $1,600,000,000 that went to
Pennsylvania at about $1,210,000,-' dividends and
surplus; of ah the
000 and stocks of the New York;
utility ; operating companies; < re¬
Central, B. & O., Southern Pa¬
porting to the Federal Power
cific and Southern Railroad, in-,
Commission in
1937 was. $749,•eluding the preferred jn each case,1
359,000 and. in.. 1943 jt was $759,at $406,000,000. -yi:4:
359,000, an .'increase of only $10,%•. Sometirpe ifl.the next 18 months
000,000.
Y
or * two
years,
when the people-;
Another thin^—I don't think I
realize that this second group of
have mentioned this to you be¬
roads is eventually going to be
fore—is that for a long time our
as" good
as
the first group of
wages were not competitive with
roads, you are not going to'gave
new
industries, such as automo$800,000,000 market value differ¬
biles and the chemical industry
ence between
the first four and!
v
had
are
the C. & O., Union Pacific,
had a Norfolk & Western, Pennsylvania
report, 1937- to 1943.
The
amount of money left for restoration
of bond ■ credit, and and L. & N, But they don't sell at
45. The average, the comparable
interest,, dividends and surplus of. that is why the public has not as;
all the utilities reporting to the yet been willing to assume that average of the railroads, that is,
Federal Power Commission for the some day when the bond pro¬ the five dividend-paying railroads
which have paid dividends as con¬
year 1943 compared to the year
gram 'is completed, .this earning
1937—and you all know about the power will be given out to them sistently, as the Dow Jones indus¬
kilowatt production being way up, in the form of dividends.
And'I trials, are selling today at 105, not
45. That is the price, if you added
just like ton miles are way up— think that time is fast approach¬
it up, of C. & O., Union Pacific,
was
an
increase of $10,000,000. ing.
It has approached in nu¬
The inqome available for interest, merous, situations and I think it Norfolk & Western, Pennsylvania
Power
Federal
because, after all,
minds, of that,
railroads
their
they are not selling
hear $12. is. $25, and
you
would
be¬
and, second,
buying;
-the
cause
?
Railroad Stock Yields
What did they do 65% of everything they take in.
.-Now let's go to the rails and
with the money?!
.
,
The difference between $37 and pick up five, if we can, of a siih-
•
% Now go
they
But
at those
problem and you hear little about
the others.. ■;% v: Vy
Position of Railroad Stocks
t
and
Then
125?
babies.
much about the railroads' wage
so
people
to
Allied
buy the stock.
ered, first because the bankruptcy
fear
eliminates
a.
great
many
closed at 32.
•
Great
Take
■
Northern:
u Their
basi&, dnd
four dollar divi¬
bond credit is on a 3.40
if you
figure a
dend, which the stockholders' are
certainly entitled to in 1945, the
stock tonight is; on'a 9V2% basis
against 3.40% for the bonds:fi '
Take Atchison. The bonds' ar'6
selling at 126.
What yield is that
3%, about 2.97, ^nd
stock at 78, yields 8%Yf 5%
—less
the
than
yield on Atchison is 120.
Southern
Take
4s
at
98
Railway;1)C'The
yield almost- 4%. VT afti
picking out the junior bondS^eYe'.
And yet the stock, iif ;you figure
thby'pkid dividends irregularly.
it on a $3 basis, at 33, yields'close
But rfirst, in those first ^Jive rail¬
to 10%.
the purchase of rails because in roads, last year they earned $12.21
Atlantic Coast Line. Bonds on
and they paid out $5.80. They paid
my opinion they are out of line'
a
4.50% basis, and if you figure
out 47%
of what they took in,
with the industrials.
I don't say
at least a $5 basis, the stock is
against comparable stocks, indus¬
that the industrials won't go 40
yielding over 10%. 5% basis1 on
trial stocks, paying out 65%.
or 50 points higher, but! do know
that would be $100 a share;{JJ
Now in this next group of two,
one thing, you have no insurance
Southern
Pacific
bond&',;* are
in the industrial averages.
And, Atchison and Great Northern, ir¬ closfe to 4.90 basis, and if
'^oa
if we are going to hit a depres¬ regular on their record of divi¬
figure the stock on a $3 basis; it
dend payments, but high gra$|, is close to 9%.
sion, they all go down. : They
- '
always did.
My sales resistance never having been in any real
You can go on down ibr'that
now
is "that after the war, why, trouble, last year they earned $15 manner and follow the other ones
all the rails will go right back to and paid $3.66.
They only paid to see that as the bond credit im¬
where they were in 1938, but the out 24% of what they earned, in
proves, stock prices improv^] ahd
industrials will stay where they both cases using their earnings, through this payment of debt, it
are.
Well, it never happened yet. their surplus earnings, to pay and will allow dividends. And "they
Let. me give you a few prices reduce their bonded debt. They will have the earnings and haVe
between, 1937 and 1938.
At one sell today at an average price of the dividends if you can fhstify
\
that I
think
Don't
am
.
recom¬
mending the sale of' dhftustriais.
I am: not;' I am recommending
.
time in 1937 Allied
at 258.
.
Chemical sold
In 1938, at 124.
American;
I am .reading the
industrial
American.; Smelting,
61 y2.
:;Y,vc-;
Now
Can,. 121 to 70.
inal
to
the
nominal
150
averages,.!
from
55
to
phone, from
ican
28.
Tele¬
American
187 to 111.
Amer-I
Tobacco, from 99 to 58.
Bethlehem
Steel,
from
Chrysler,; from 135
Corn Products, 71 to 53.
39.
105 to
to 35.
words, pick out the one
that resists a severe business de¬
cline.
Which is the one that stays
In other
I am emphasizing this
because I say if they can justify
those prices for the Dow-Jones
industrials, railroads are cheap.
They have to be.
And if you
think there is great risk in the
railroads, * then
there must be
great risk in the industrials.
up
there?
that is, those paying nom¬
dividends, the group that last
year
earned $10.18 and only
$1.30.
They:' paid
what they
took in.
out
paid
12%
of
Canadian Pa¬
or.
155 in the Dow Jones
dustrial
group;
stocks in the Dow-Jones
come
we
You can see, as
in¬
Vt; -.d..
averages.
I have said., be¬
fore, how stocks follow bondis. nlt
was only 21 months ago when D.
& H.. sold at 51, and the vstock
sold at 9. They solved the ? bund
98V^r;!and
cific, New York Central, North¬
ern
Pacific,
Southern
Pacific,
Southern Railroad
and Atlantic
Coast Line.
They are selling to¬
problem. The bonds are
the stock at 341/2.
!
day at an average price of 29.
discbunt what is going to happen,
and not. wait until it has,.hap-»
Then
we
come
down
to
-
the
I
can
give
you
similar examples
hhveitq
in other roads where you
group, " which last pened, and you can followuit by
earned $10.47 and paid noth¬ .following these plans of reorgant
ing. B. & o., d. & h., d. l: :& w.. ization, not only the ones I; am
Illinois Central, Nickel Plate and particularly interested in, sueh'as
Island and Seaboard
Boston and Maine, selling.lat an the Rock
non-dividend
year
and St. Paul,; but in the B. i& Qv,
price of 20. Thai gives
the D. L. & W., Lehigh Yalley
much better idea of fore¬
and some of the others—^Nickel
casting what these stocks can do,
because
if Atchison and Great Plate. Take Nickel Plate, bonds
21 months ago sold at 55^. and
But just to continue to prove to Northern can reduce their debt
as
they have done, there is^ no they are called. The stocka( sojla
you that nothing escapes if we
at il, and it is now selling ;at 34.
reason why they can't mov$ into
are going to have ruin and stag¬
Illinois Central,; the debenture
nation in this country.
DuPont, the next group; into.the L.- & N„
180 down to 90..
Eastman, from Union ; Pacific group of stocks. bonds, the 4%s of 1966 were sell¬
198 to 121. General Electric, from And likewise, the progress that ing at 38, and the stock was at 6;
The bonds hav# made a partial
64 to" 27.
General Foods; 44 to 22. the Coast Line has made will!
(Continued on page 2822)
General Motors, from 70- to 25. move it into the Atchison group.
.
average
you
a
•
2822
THE COMMERCIAL & FINANCIAL CHRONICLE
Thursday, December,
Railroad Stocks. Should Brazil's Attitude
Follow Railroad Bonds
recovery to 78. The stock is at 20.
Do you think the stock will be at
par?
recommend
way.
buy. them
Of
the
B.
These
B.
&
&
at
sell
think
the
Take
first
The
2.
at
80
bonds
are
the
Erie.
When the
new
Likens the International Fund to an Insurance
Institution,
and Maintains That Plan Does
Not Eliminate National Exchange Con¬
trols, But Prohibits Restrictions
Made Abroad.
of
$306,
$1,150.
Without
ture
in
tion
and
around 70.
Now today the
at 5.
common
adds
against
and
cash of $100,
to around $1,200,
present
price of
up
their
the
on
Payments Already Contracted
:V-,■ / -f,■ V;v'/;;•
.;
the
you
successful
operations
:i;:
to Be
the
tude of the United
sidered
pro¬
de¬
are
like
war
a
now
going
the
one
through,
it
Nations, I
movement
a
thousands and
above the call
proximate capital appreciation in
pay
at
Rock
of
impress itself upon the destinities
bonds, first mortgage bonds sell
price, the incomes
85, and could go to par. The
preferred at 69, If the incomes
go to par, the preferred should
go to 90, and the common will
not be at 13, on the 8% basis with
a dollar dividend, and if you can
figure a $2 dividend, on a 16%
'basis—that too will follow the
model of the others.
You
the
saw
Wabash
at 23.
the
dicated
Coast
to
be
and
mitted
Line,
Southern
other
at
Pacific,
happen,
One
way
Wabash,
you
or
the
Marquette
Nickel
bond
Plate
banks
Now if you believe any of
that I am telling you, you
this
get
back1 again to defaulted railroad
bonds, because
for
and
preferred and
almost nothing.
Take,
for
instance,
board 1st 4s of 1950.
;
the
-
and I
am
They
are
not
sell
will
at
par,
claiming very much.
98V2
bid.
,
The income bonds, I claim, will
sell at 85
90, but I will use a
price of 85. They are selling at
68, one of the cheapest income
bonds
or
the
on
incomes
Forget
know, if
market,
Seaboard
68.
at
prejudice.
your
you traded
your
You
preju¬
dice for the last five years in rail¬
roads, you would still be waiting
to buy them.
■
But
to
I
that
me
Now
be
least two roads
is
in
numerous
most
unstable
United
industry
unstable
States.
can
only
those who
as
use
and
buy ton miles and passenger
miles.
Therefore, I think, rela¬
tively, the railroads, forgetting
the financial angle, are just as
stable as industry is generally."
You can find exceptions, natur¬
ally.
But that is
one
of
my
thoughts that I want to leave with
YOU.
Now I
//.
":
•.
claim that railroads
are
going to be up and down with
industry generally. They will-go
and
up
I
down with this
have
even
war
ing
tried
at
to
this
point
babies, they
the
war
not
are
show
country.
you that
they
are
are
not
not discount¬
earnings, because
getting much of it
dividends.
The
bond
market
in this country that are being
reorganized that will be run by
has rightly discounted it, because
the stockholders.
and 47%
One is the Rock
Island
and the other is the Sea¬
board.
And for the benefit of the
stockholders.
are
going
but I
I
to
don't
waste
if you
mean
this
they
money,
$15 and
you are reorganized, if you have
no
problems, there is not going
to be an argument about whether
you are going to get $5 of it.
Now if you add those up at my
prices, bonds are worth, includ¬
ing -the cash you are going to get,
the bonds are worth about $1,300.
They clos$I tonight at 81. And
mean
earn
you
losing half
are
your
bonds,
no
maturities in the
reorganized
companies, and
through this B. & O. thing, and
soirfe where
along the line the
Illinois Central, those
maturity
problems
There is
You
will
have
a
of
taken
You
going to
net working capital posi¬
over
off.
Rates
of.
two
are
billion
to start off whatever
start
care
danger of bankruptcy.
going to have good cap¬
italizations.
tion
be
no
are
are
been
kind of
use
to
we
dollars
have to
Nations
which,
Need§
to
Healthy Europe
a
Brazil's
interest in the
of the international
agree¬
;
Bank
for
Development,
founded likewise with the collab¬
oration of all the United Nations
it
has
the
as
its
principal objectives
furnishing of., credit for the
reconstruction
of
devosted by the
war
the
countries
and attending
to the necessities of the
whose economies
mary
of
countries
in their
are
phase and which
are
pri¬
in need
V
resources.
will
combine
toward
future, the renewal of the proce¬
previously used and
by
means
of
which
there
was
"To
a real trade
war, by means
exchange rate modifications.
'International
Monetary
justify this
sufficient
con-;
ducted
of
This
rise
gave
a
was
the
to
real one, as it has in view the
reestablishment of world equilibr
rium.
monetary policy
permit, in the
a
not
which
greatest amount of discussion.
v
"I have the impression that the
criterion; which prevailed is the
dures
they
pared to last week
I
don't
think
any
be able to do that.
any
could
tell
to
cheap
are
you
as
com¬
or next week.
man
will
ever
In other words,
sations to many of the
ing countries.
don't think you would ever be
able to figure out just exactly at
tance
of
criterion it is
to
verify the impor¬
the European Continent
in the economy
of the world. Some
figures will better express what
I
have said.
others,
of
advantage to all.
would happen
"What
is
creditor of other countries.
"If we examine the fact in
lation to Brazil's
re¬
economy, taking
to
eco¬
the
1938
ucts
invest¬
indefinite contributions in favor of
our
speculation, call it what
will—you have heard me
minority which suffers injuries
and damages?
"The Fund, in the final analysis,
to
belief
my
what
never
do it.
is
that
or
you
it
before—investment
or
speculation is nothing but en¬
lightened attempt to forecast the
future.
ture.
You
You
and the
can't prove the fu¬
can
cast, based
only
use
this fore¬
knowledge
upon your
knowledge of other
peo¬
ple, and their opinions as to what
conditions might be, particu¬
larly relatively. And if you have
the
thoughts—the thought that
has always guided me is that the
competition of the market never
proved anything. When MOP's 5s
the
at
10, it didn't
prove
thing.
;
any¬
.V.<, '
Well,
why—and
I
say
this
guardedly—why must I assume
that somebody who pays par for
bond
knows
anything
more
about it when he sells it at 12
I don't
will.
I
assume
realize
compulsions
it and I
that
or
never
there
are
forcements
and
and
kinds
far,
as
of regulations, but so
being able to know more
about the value, it isn't true.
So that
prices don't necessarily
anything.
Now,
clusion
another
I
what the
thing, the con¬
trying to make is,
am
crowd
wants
never
es¬
tablishes
quality. That is really
saying the other thing backwards.
But those
ways
contribution
tions, with the idea of demanding
majority of the insured
label
prove
such
from the
able
But
13?
but
figures, we shall like¬
wise arrive at similar conclusions
in regard
to the
particular
moment
stock is worth; I have
ment
a
in
force of production is
highly im¬
portant, especially for a country
of
the economy of the United
States, a great producer and great
nomic development if we were not
able to create insurance institu¬
been
sold
participat¬
Some of them,
fact, foresee the hypothesis of be¬
ing but contributors in favor of
I
any
not offer immediate compen¬
may
develop
yardstick
a
as
when
able
formula which I
a
all
of your bond issues.
They have
As
have
oc¬
that the rail¬
the
the
service
a
as
in
at
on
you
Brazil
is
some
tell
it
time
never
I can't change
tried
to
era
the creation of
a
re¬
any coun¬
a
.
ago,
road industry sells nothing but
service, ton miles and passenger
miles, yet people will try to tell
you
be
months
^of our discount bonds.
have
casions
there
will
21
some
an
it is necessary that all
United
planning
the
Management for the Fund' and the 'Bank for Recon¬
"It
was
not
possible, conse¬
out trying to
sell struction and Development' rep¬
quently, to think about the rerailroad service and trying to im¬ resent the
possibility of this co¬
establishment of the economic or¬
prove their efficiency, and they operation."'.''(-/v^der, leaving aside, whether be¬
have done so. We have no more
Fund Is for Seasonal Use
cause of its
having been devastated
wage
problems
than
industry
Using the principle of mutual by the war or for any other cirTgenerally.'.
' \•:
insurance
as
analogous to; the cumstance a conglomeration of
The dividends, or lack of them,
Fund, Mr. de Souza such magnitude in the mass of the
will be corrected, I think, in each Monetary
Costa said:
"By virtue of their world.
What it represents as a
case
when these bond
problems
nature, the Fund and the Bank consumption market and as a
are solved.
I don't know—I
first
wait,
bought
Stability of Railroads
continue, Seaboard
4S of 1950 get $137 in firsts, $700
in incomes, 4.6 shares of pre¬
ferred, which I think will sell at
70; It is selling at 51 now. And
3,7 shares of common, which is
selling at 20. I put a price of 30
on that.
I think it will sell higher
than that, because in my opinion
now
at 59
(industry
,
without
of
exist
part of the
institutions." .■' I'..1.:
new
point
the
count
on
kind, in
try, which would be
devastated countries.
or¬
in
continuance of
and
peace,
that, in
good order
assure
competition.
to
have
5V2S and 4%s.
as
was
on
May 19, they closed at
They closed tonight around
82.
And as I have told you be¬
fore, they get $137 in first 4s,
claim
haye
could
Sea¬
When I
63.
I
they
they
them
here
which
that
when
world
convinced
are
to
countries
some
We cannot
of
means
"We
"The
com¬
with all
sys¬
from
others.
,
doing it.
are
insurance
common
cre¬
new
ate income bonds of the
tems
They
and
the rules. Apparently they can't
either, but we as individuals can
discount it, and we as fiduciaries
can hang on
until the call price
still
can
to
methodical cooper¬
ation among the nations."
v :
"With this in mind," he con-
restored
;
you
by
panies and fiduciaries now buy
Nickel Plate bonds. It is unfor¬
tunate
Railroad Reorganization Bonds
capital
ani¬
not
{'*.:■■■
ence, in which I had the honor of
"It may seem, at first
sight, that
heading the Brazilian delegation
an.
exaggerated
and regarding the work of which
importance is
given to the reconstruction of the
I am today seaking to you.
to
indispensable
becomes
better world
a
Now the
their
was.
has
credit.
The
through
reorganization,
another way, through reduction
of debt in the open market.
-
prior
which
mated the Bretton Woods Confer¬
of
into
things.
Pere
no
credit.
Erie and
resurrect
in
as
war
decades
ideal
•
der
of
You know, for the
last two years I have been talking
on
some
of the borderlines, that
for example Nickel Plate was go¬
ing to resurrect their credit, that
■
going to
when
the
tral, Nickel Plate, D. L. & W., Dj for a permanent institution of re& H., B. & O. I believe they will
equilibrium of balance payments
closed at
of humanity.
"It was this
tary policy in relation to world
trade and orientation of the flow
In the next group Illinois Cen¬
13, and it closed today
at 67.
;
•":•<
These are not rank speculations
as
some
people think they are.
They are only discounting what,
is
others,'' the
create international organizations
for the coordination of the mone¬
because the Penn-t all get out of that non-dividend
sylvania owns it all. But what group some time.
:
Now just
happens to the preferred? It was
to mention a few
war,
in
"It
that
common,
then
for
1939.
Great
of
out
move
nations
calamitous mistake to repeat
crimes of contraction com¬
a
the
Southern Railroad.
You can't have the model for
92.
the
Atchison
will
thousands of lives
the price for the indifference
some
Finance Minister stated, "it would
:
■
group into the next group. In the
next
group
I can't recommend
them all, but I certainly would
They closed tonight at
Bs, not the As, which
V;;
that
Northern
And they incidentally are the
88.
Islands, New Havens, St.
Francisco, and some of
others.
have indicated to you in that
first group of 5 stocks that I think
L. & N. common is cheap. I in¬
rec¬
incomes
ap¬
I
thing happen
same
2Vz years ago I
ommended
same
Louis-San
'
in Wabash.
you
tails, there is still that
was established
creation
regard to the
Reconstruction and
faith
period, a new
outlook which it was hoped would
the public
importation
on
or
"With
arising against the sentiment of
distrust created by isolationism in
the 1918 post-war
we
where
the
the
over
ments, the speaker said:
con¬
of
control
striction of any
1
"You will recall,
undoubtedly,
that, when referring to this atti¬
inaugura¬
of
to
ther£ would
success
Conference.
;
after
Fund
espe¬
ton Woods
right of controlling
.
private debt,
merchandise, it
that
\
years,
the
themselves
to
payment of services
of
cially—decided to hold the Bret-
posed institutions.
"After
giving
reserve
and
Brazilian Finance Minister Arthur de Souza
Costa, in addressing
the Commercial Association
of Sao Paulo,
Brazil, on Oct. 27, 1944,
explained to his audience the pro-^
visions of the International Mone
tinued, "the Allied Nations—the
tary Fund and the International United States and
England
common, 25.
and the bonds would
preferred,
which
forthcoming
"Relative
the World/'
you
worth
of
am
at
comes
share
using 1942 in all my
The first mort¬
at 86, the in¬
45, the preferred at 30,
prices—I
to
the
the sovereign
Closed tonight Bank for Reconstruction, as set up
at 65.
>
1' under the agreements of the Bretton Woods
MOP 5s selling around
Conference, and pointed
70, $400
in lsts, $520 in
incomes, 2.2 shares out the importance to Brazil's fu¬
past comparisons.
gage bonds sold
the
One
Cash of
be
so.
mortgage bonds traded at
prices—I am not using 1938
1942
Generals
95, but I don't think you will
at that price.
So we
that.
90, do you
going to sell
I don't think
No.
the
will take the St. Paul 5s at
75,
selling tonight about 65, You get
$180 in incomes. I put a price of
85 on that. You get 9.2 shares of
preferred. I put a price of 70 on
or
is
stock
10 then?
at
same
50, and the stock at 10.
think when those income
Do you
bonds
the
O. incomes, 4&'i of
they sold at 18, the
at
was
now
at
at
O,
1960— when
stock
sell
not.
course
The
bonds
ing
countries
Minister, Who Was a Conference Delegate, Asserts the
Agreements Attained "An Objective Indispensable to the Good Order of capital.
they closed May 19 at 63.
St. Paul gold 5s, 75." I would
20
the
impossibility of foreseeing the
tlow of movement of
capital dur¬
Bretton Woods
on
to
movement of capital.
By, virtue of the almost absolute
Her Finance
(Continued from page 2821)
when
tive
28, 1944
two
guided
Editor's
concepts have al¬
me.
Note—The
foregoing
address was sponsored
by L.
regulated for railroad Rothschild & Co. in Boston.
F.
a
is
insurance institution against
an
fluctuations in the balance of pay¬
ments.
If all contribute to this
Fund
the
we
shall be able to diminish
harmful
effects
disequilibrium
trade
to
"The
Fund
the
therefore
aid
to
maintaining
it is
benefit
all.
„
,
.
Monetary
institution
an
the
the
balance
economic
of
International
is
destined
their
of
in. international
countries
equilibrium
in
of
of
payments when
by oscillations of a
cyclical nature."
affected
seasonal
or
.
.
Finance
Minister
as a
and
a
market for
requirements.
"The
having
Bank
as
for
its
our
of
prod¬
of supplies
source
for
*
;
Reconstruction,
principal objective
the restoration of. Europe and the
reestablishment of the industrial
and
economic
order, envisages,
appropriately, the solving of
the economic problem and, more
than this, the political
problem,
preventing unemployment."
very
.
Bretton Woods
an
.
.
Achievement
The Finance Minister concluded
his address by saying:
"Other international conferences
-that of Brussels in 1920, that of
Geneva in 1922, and even that of
London
in
1933—concluded
by
.
Necessity for Exchange Control
SeenY, -•••'
The
importance
Europe
proposing this policy of coopera¬
tion, of wholesome and sund un¬
dertakings among men, but the
stressed
Bretton
Woods
point that the. Conference
agreements do not prohibit na¬
further:
it
tional
ered the
the
exchange control.
"Attention might" b£' called
the
to
ion
an organ¬
the
ization with the objective of nor¬
the
the
fact," he said, "that
malizing
the
exchange
situation
should have permitted the exist¬
ing
Conference
studied
and
went
examined
interests
at hand; it consid¬
prejudices of public opin¬
existing in England and in
U. S. A., as well as throughout
world, pondering them, mak¬
concessions on many points,
sacrificing solutions which
exchange pontrol;. how¬ in the technicians' opinion were
considered
excellent
ever, one should not confuse ex¬
points;
it
change control with exchange re-» tried to obtain adequate orienta¬
tion
striction.
to
all
practical
aspects—
"It was fully agreed among all finally
it drew up a code, a
ence
of
nations
that
even
signing
there
the
would
no
Agreement
longer be
exchange restrictions with respect
to payment of merchandise im¬
ported and the payment of inter¬
est service on capital investments
within the country.
There may
only exist exchange control rela¬
regime, to riiake the world's mon¬
etary system function, assuring a
relative stability in the value of
the
currencies.
t
•
-
.
"Bretton Woods, gentlemen, has
therefore attained an objective in¬
dispensable to the- good order of
the world."
*
Volume
vigorous manhood than
more
Here Are Some More
Expressions
On Peacetime Training Proposal
/cm at
benefits
to ail youtii
A
V
will
accrue
tnroiigh this training.
complete medical examination
prior
starting tneir one yeai
of training will expose visible ana
latent physical defects. Correction
of these aeiects will follow, with
to
result
the
ards of
will
leadership qualities will
tire
front,
pnly
\outh
command.
will
but
obey,
to
At
an
to
come
learn
not
how to
early age they
also
and
will learn to sacrifice.
qualities will build
tney
of
All
these
Oivilian and business leadership to
Strengtnen their adult years.
■V In the next
war
:
it will be pos¬
radar
rocket
and
planes.
Vast armiet
transported in giant aerial
will be
Speed such as wt
troop carriers.
have
never
the
dreamed of will mark
months
takes
It
attack.
train
to
to operate a gun
turre,
in a bomber, to drive tanks, to fly
planes, to accurately fire artillery
and to maneuver ships in battle.
We shall not have time to mobil¬
ize and train after another Pearl
Harbor—we
must
be
ready to
men
vnd
Pancoast,
San Antonio, Texas
7;'
record
fight.
I
fearful,
not
am
I
some
as
re-
are
in
7
•
' 7
countries
militarism-
have
or
Ra¬
feel
nesses,
i have talked-
The
;
the
moral
subject matter of your symposium
as I was
born and raised in the
been
Army,
of our
na£
to
-
;7
been greatly
-
•
.impressed
by
fact'
we
the
have
had
n ever
war
a
yet
without being
caught unpre-
and
pared,
when the mil1
e n
i
weakened
sure
grams
many
i
u m
H.
H.
;
I
vis
s
with
interest
interest
program
are
["Chronicle" of Oct. 261,
and
that is the class of people which
found
of
the
us
in Congress,
unprepared at the time
Pearl Harbor catastrophe.
should
at
that there will
It is all very well to say we
handle Japan and Germany
so
the end of the war
aggression in those
countries, but do not overlook the
fact those are not the only nations
In the world from whom we might
be
no
more
i t ha
deal
of
My
reaction
own
the
ques¬
of
tion
believe
events
have
proven
that true military training for our
young men
undoubtedly results in
physical training such
for all young men,
as
and
is needed
you
tary
>
.'is:
com¬
militraining
-£;;'u
.
(1) lam fa-
v
vorable
'men
to
see
have
there
three
'months; they have a different set¬
up
of discipline, regular hours and
food, which results in
'making better men and men ip
a better position to take care of
the proper
us
•
when trouble comes.
Let
us
not be caught
unprepared
again, realizing, as we do, there
the
it
to
grounds
ical training
lieve
p a c
the
is
rible
we
as
a
thing, but
nation
pared
to
hold the
&
Theory
c
a
i p 1 e
r
with
of attack is so great that our
must be prepared at all
costs., Is this hypothesis logical?
at pas^
experience seems to indicate
011 that wars tend to be spaced some.
ger
.
price
7
25
.
a
I
.,
,,
G
in
suc-
promptly,'
act
to
soldiers
able
the
can
of
more
our
young
men
be
the
next: war.
when it actually comes.
given such training,
is, both for them and
training
military
usually
than
three
or
requires
not
hours
four
in
col¬
more
of the
Y
*
Moreover, modern war does notcall for great numbers of non-
specialized infantry. Instead, it demands
their
great variety of special¬
a
Men must
ization,
be
experts'.in
particular fields.
Is there
probability that, in time of
student's time each week for two
any
school
peace,
Such training does
not interfere noticeably with his
and
for
their posture,
Moreover, most .of them will, have
and provides them .with some oi
families and will on that account
the information concerning mili¬
probably be excused from service.
tary matters which every citizen Their training will therefore help
ofight to have.
It seems to me little in preparing us for war
leges
Far
East,
which
them
teaches
alert,
'
serving
the
we
greatly 'improves
But
Division
32nd
if
fore> that the boys who take .mill¬
tary training in 1945-46-47 will
mostly be ttJo old to make desir¬
Such training-
the boys learn to be
for the nation.
outfit—
same
colleges.
our
makes
."hat
the
d,
and,
bly impressed J gig^t.-1 The probability is, there¬
,
the better it
National
u a r
ing in
that
Michi¬
the
gan
apart,
years
! cee(I in defeating both Germany
f
...
product, of 45
years' service
in
the nation
? ^ favora- j and Japan potential enemy other
decisively, no
jmmediate
is in
Co.,
Mich.
the
is
you
prepare
country
v^rVh
ding
sen
am
Practice
for eventualities and that the dan¬
it
,
the
is that it will
up¬
stanas, even
'
and
hypothesis of those who
favor universal military training
prins
for
which
they, the sophomores,
experiencea earlier.
The
never¬
theless be pre¬
be swept off our
SCHOUTEN
had
ter¬
a
must
arks or
conclusions
that
now
ment which
height of folly,
War
every
great deal
of interest the various discussions
r e m
boys
matters
i f-
be
to
comes
7V; ■'
read
their
sophomores anxious to haze the
They want to even up
by inflicting upon the
freshmen
the
unpleasant treat¬
ing that I be¬
£
war.
Grand Rapids,
have
do
athletics,
years.
The
education.
bill
Divi¬
now
,
universal training courses
one
year in length will provide
before the types of specialization actually
/
:
Congress proposes to keep every needed in the next war?
sion made an
It seems obvious that what we
on
young man in the army for a full
leadership
enviable rec¬
would be de¬
year.
This program would obvi¬ really need is not to prepare men
ord; in World
sirable for our;
ously substitute military training for the next war but, instead^ to
War L
7
for one year of our present Vol¬ prevent the next world war from
young men.
I
am
very
Gen. J. H. S^houten
untary system of education. The occurring.
Clearly, we need a
(2) On the
well posted on
James B. Trant
other hand, I,
only other alternative is to take world organization equipped with
the faults of our National Guard
a year
out of the man'^-working a highly efficient, modern army,
:l7 VI do not believe
that universal compulsory, train¬ system, which can all be remedied career,; The question at issue is small but well trained in all the
by our Congress, and with proper whether the
This is
game is worth the latest technical devices.
ing will; have much weight on'
and the stress
.
action from the Administration.
whether
or
another
war"
which
compulsory.
training
have become
jnot / we. will
Those
military
embroiled in
any
other
and
the
not
-
think,
compulsory
in those
thelresult
was
spirit
the
much
as
I
country.
trailing
military
about
war
however,thft
tries
have
countries
haveJbad
of
coun¬
warring
a
cause
of the
'v. /":v.;
war.
(3) I do
.
been
when it
in
Schouten-White
:
the
preface my re¬
£ (Brigadier-General, Retired)
—now
on
have
the results in the
training camps after these young
only
?
said
is
than
avoid
who
a large
part of
in the army favor
u niversal training.
They are
doubtless actuated by motives
much the same as those making
sym¬
posium on the subject of "Com
pulsory M i 1 it a r y Training ir
Peacetime for America," I wish to
would not be in the
the
people of the
JOHN II.
pulsory
as
expect aggression.
'•. I
classmates
your
young
much shorter
lives
with the results of military tram-
the
.
that the phys¬
the views expressed by him
similar to those expressed by
the isolationists
men
nation.. -V'Vl
I
w
to
mil¬
Cyril F. Meyer's opposition to the
and
to
the
really strengthen them physi¬
making them healthier in
We have no proof that
it does.
Instead, various investi¬
gations show that college ath¬
letes
excelling in strenuous
lines
of
sports
tend
to
have
It
reference
With
of
cally,
Accounts and Finance
time and adopt some
of
health
after-life?
University, School of Commerce,
,
interest.
Rev.
the
the
Professor of Economics, New York
us
of
war
actually
has
training
:Y!V;
7:
by; the sentiment and pres¬
;
[in
great
zation.
read
I
want.
One good scien¬
is more valuable
not
program that
Whether army
of moment.
nesses
military force
ism
keep
"Chronicle" o| Oct. 26] on com¬
oertaining to post-war military
pulsory military training between
training organization, and so forth.
Rev. Cyril F. Meyer and President
Wha tever
v
Haryey N. Da-,
itself
a
will
-
the! discussion
read;
I
organi¬
itary
No
to scien¬
means
hope, therefore, that
will
army
marks by say-,
freshmen.
sure
■
:'V/£;;££. Baton- Rouge, La.
country
without
Kirkman
pro¬
feet
'
M.
man/ better
that
million
nation
superior
the
it
I.
War
of
all
could be devised for
to real emergency
State "University
and Agricultural and Mechanical
College, College of Commerce,
be able to take
H,
being prepared for
war, but I be¬
many better ways
prepared.
tific discovery
JAMES B. TPvANT
mi), then
only can we
expect to have
of
a
in
WILLFORD I. KING
research
a
the
in
have
ple
well
Dean, Louisiana
la
care
and
will be better than what the peo¬
almost unlimited
than
man
since
what
to
I believe that we should devote
tific
view,
us
World
are
that
of
the
of
dreamed of for many years
parable
Dewar
in the post-war world, it is
peace
second to nothing.
down with the
our
cost
the young men.
applications of
paternal gov-
lies
lion
the
termination to create a force com¬
are
there
point
improved
men in
the services is open to question.
Strenuous
training
undoubtedly
hardens those receiving it.
Does
get ready than to have all our
through
reached, and
the
at
involved
conscription
of
national conscription act.
But to accomplish
that, Con¬
gress must come clean in a de¬
spend a year in military
training.
I believe it would be
expensive and inefficient.
I am
considerably
high
lacious, for the army has care¬
fully weeded out all of the can¬
didates having any physical weak¬
any
ooys
tion had been
and
service
in the
without
fraction
eventuality of
lieve there
fi-
oer
create a Na¬
we can
goods in any national emergency
I thor¬
nation's
a
the
when'
time
l
m
have
compared to the man in civilian
may- be
cited.
Obviously,
such a comparison is entirely fal¬
Franklin S. Harris
a,
as
they
would
in
the
course
of
be
even
life
tional Guard that will deliver the
rious weak¬
w a r
along
I am, based on
public debt.
oughly believe
came
this
45 years' service, firmly of the
opinion that
*
will
life,,
as
,
strongly about the
very
%*■
z e
contrary effect
on all to whom
Furthermore, in helping maintain
I
i
the
with
face
to
them in later
or
health
my
many very se¬
New Haven, Conn.
:
777
to
ther it has tne
tional Bank of New Haven,
Na¬
Tradesmens
come
recogn
again,; and I think that universal
youth training will be a tremen¬
dous
factor "in
maintaining it.
The
h
I
and
face
they really
what
We are told that army training
is necessary to build up the health
of our young men; In support of
the U. S. Ma¬
dous
like
Iran,
guardianship of the
Corps.
are
Have
much of
college training?
I se¬
riously doubt that such is the case.
problem of paying off a stupen¬
and
them to either
school
National Guard should
new
We
European
ing to endear
war,
learned
be under
rine
seen
countries
ceiving is go-
future emer¬
any
and independent as
and of
have
in
army
regular army but should be as free
it in operation
that the training which our
much.
as
in
not
I have made some
itary training.
art?,
learned
learned
useful to
The
the
previous
favoring universal military train¬
By
II. M. KIRKMAN
President,
deal during
universal mil-
ing.
training.
gency.
result
as
.
■/"'V
compulsory
for
good
a
experience
I
am very much
opposed to
compulsory
II. II. DEWAR
:
ernment theo- ,'/' 7
K.: •££.;. £
•!
saving
ories, and though the horror of
critical time,
universal military war is a terrible price to pay, a
training may save our country.
corollary of our participation in
There is no sacrifice too great
it, namely, universal training, has
to retain our free way of life.
■£'
restrengthened this fiber. 1 hope
that it will never be pulled down
and
mob.lize
as a
my
I should like to go on
up
of this
caught unprepared.
Dewar, Robertson &
proposal
past few years.
study of it.
strong
were
we
fascism.
and electroniccontrolled artillery, robot bomb;
by
if
we
;,
sible to bombard cities across the
ocean
whom
men
will learn the value of teamwork
oeen
nations irom
could expect no mercy
of
number
youJi will be raised.
learn selr-rtliaxice—
oar
Youth
long as war is popular, mucn
more so thampeace among a great
advantages of army
Undoubtedly they have
that will serve as well as the reg¬
military training in peacetime has
experi¬
been
the
an
Unelq Sam
give
and
efficient
have
army
effective land force
to
steps
the
ular
The
earth
such thing as peace on
no
pass
the
University, Provo, Utah
as
health stand¬
the
that
is
encing
is declared, and if Congress
the needed appropria¬
tion bills we can immediately take
President, Brigham Young
•
in
will
HARRIS
STEWART
2823
peace
we
beginning of this war.
uic
FRANKLIN
(Continued from page 2814);
Training Benefits
Valuable
& FINANCIAL CHRONICLE
THE COMMERCIAL
•<Number 4346
169
adequate
and
brieve
with
force
so
a
very
army
equip¬
large air
thatjwe may have pro¬
tection at
alljtimes.
we
should
in
able to mobilize
manpower
aiid
case
more
we
"V'»
of
war
quickly
be
our
should have
a
candle.
armed
What will the young man
What will the nation
that
forces
no
passed until the numer¬
well-qualified officers of the
National Guard shall have had the
opportunity to appear before
and pass to it the de¬
tails of their service during World
full
Congress
War II.
reference
service
in
produced
Guard
to
same
World
penalties
officers
remarks with
National
the
War
,
on
which
I
Guard
which
Tjfeiiqnal
has
been
duplicated in the present war and
Discipline
We
will
are
vs.
Freedom
discipline and will be
many things which
he needs to know. Discipline has
in
long been highly prized in Ger¬
many and Japan.
In the United
States we have thought more of
freedom.
Do we now prefer to
the enemy?
As a matter of fact, is it not true
that one of the principal reasons
why our soldiers are superior even
adopt
to
the
the
ideals
of
Germans is that our boys,
Our
National Defense
Act
permits the reorganization of the
National Guard immediately after
obey, they have learned how to
take responsibility.
Recently most of the young men
No
new
existing
laws
are necessary.
one
7; 7'
year.
Unpreparedness an Asset
learn
educated
which would be se¬
training all the boys for
citizen army
told that the young man
being brought up under conditions
of liberty, are superior in initia¬
tive?
Instead of learning how to
time in the future.
something very diffirent from the
cured by
laws
new
should be
ous,,
gain?
military welfare of our
which should be eliminated for all
(4) Then, Should we have uni¬
versal compulsory military train¬
ing,
the future
I make the
an
adequate
and; wsh
I
of the belief that it is vital to
.
strongly in
pea|ptime standing
navy
ment
am
7
commonly overlooked is
that our losses in personnel would
have been much larger if our na¬
tion had been armed to the teeth
in 1914 or in 1939.
Had we been
A fact
thoroughly prepared for
eventualities, we would probably
thus
have gone
to war earlier than we
did, and would have hence greatly
increased our casualty lists. From
of national welfare,
unpreparedness has therefore
proved to be an asset rather than
the standpoint
a
liability.
Had
full
we
maintained reserves in
readiness
for
the n^vt- war,
(Continued on page 2824)
•
,
2824
THE COMMERCIAL & FINANCIAL CHRONICLE
future
Which
would
The
war
naval
after
the
lions
of
to
us
have
less; combat
holiday
last
saved
bil¬
ROTC Important Factor
in
A
of
for
tion in time of peace say
such
nothing
maintaining
that
fact
the
about
huge army will be a very
a
that;
mention' the fact
•have'a
we
which should
crushing war debt
liquidated as rapidly as pos¬
sible, once the war is ended. Un¬
be
less
reduce
we
is
penditures,
.will
debt?
v
;
As
matter of
merely
fact, is not this
conscription
universal
for
plan
budget, to
wider
to subordinate the indi¬
part of
a
program
much
a
fhe Federal .Govern■merit? Do the people of the United
vidual
to
■
States really want more and more
•regimentation?
brief,
In
we
are
anxious to become a nation of ro¬
bots, governed by the rulers of a
Fascist or Socialist State?
That
the real question
to be
(seems
issue.
•
••••
.
less
the
of
officers
Army
Stages
of
,
.......
President, University of Illinois,
as
in
the
during
United
the
initial
mobilization
for; the
"were secured from
present- war;
the graduates of colleges and uni¬
versities having ROTC
Just
prior to the
programs.
the Army
receiving officers at the rate
was
of 10,000 per year
war
from the ROTC.
It is obvious that
without such
a
of
officers,
inadequate
though it was for the present con¬
flict, the mobilization would have
been
greatly retarded and we
should not have been
as
we
are
^
^
far
as
Such
along
^
now.
impor-
an
j^g^y vaiued system of
...,lrirl.
' sho,lM be an in¬
securing officers should A an in_
tegral part of any national mili¬
tary training program.
?
I
have
various
i 'in
A.v a. C. willard JAA A;>
,y
commissions
secure
officers in the Army.
No
than
50%, or about 75,000
off the
supply
JfA' J.U
J.;
,
a
the
paying
of
nothing
„say
likely that we
it
balance
even
military ex¬
our
and
reserve
States
They do not
expensive process.
it
;
conscrip¬
advocate
who
made
war,
possible for students in many col¬
leges and universities to qualify
Expensive Process
Those
-
read
with
articles
interest
which
the
appeared
issue of Oct. 26,A giving
your
other
views, pro and
subject.". "A"AA;;-
con,
on
this
Dean
am
Emeritus, School of Business
Administration, University of
training.
My
conviction is based upon the pre¬
vious experience of our country
in attempting
to expand our
•
military
forces
armed
after
war
in
:
,
of
trained
in
sands
of
gross
C.
Willard
from
our
unpreparedness to fight on
and in the air.
next
much
more
will
war
skill
and
demand
there
will
be far less time to prepare for if.
If we had been ready to fight a
.highly mechanized war, such an
aggressor as Japan would never
have attacked us. In my opinion,
adequate
,
preparedness (military
training for all youth) costs far
;L?ss than war (in lives, treasure
and social -values resulting from
'.
unpreparedness. A
;
In
•
addition
to
the
com-
-pulsory -military.'.training, pre¬
sumably a one-year program, it
will, be necessary .to train
proportion
■
of officers
variety
highly
of
scientific
fields
a
large
a
in
wide
technical
at
and
the
college
level.
Such
additional training
can be given most effectively in
State universities and land-grant
colleges "in which ROTC units
"would
over-
of
the
John
T.
Holdsworth
accom¬
plishment
of
his
satanic
designs
due to long preparation, to the
minutest detail, to the military
was
and
"master
race"
indoctrination
of
the. entire German people and,
above all, to the development and
utilization ; of
the
most
in
military
training obligations during sum-mer periods, and to
prepare them¬
selves for service
as
officers with
minimum interruption of
or
terference with their academic
professional training.
Such
in¬
or
a pro-
tomorrow's.
This
is
isolationism, defeatism,
or
smug contentness,
,/
■..
Aa A
Assuming
they must come—will be
chemicals,
incendiaries,
tive
and
by
one
before'the motorized
Nazi
juggernaut.
one
of
these
In nearly every
overrun
countries
service
been required for years.
the mechanized, ' s w i ft-
had
Against
moving
might of the German war machine
they might about as well have
tried
to
defend
themselves
their bare hands.
with
If the civilized
world fails to
for an
lay firm foundations
enduring peace future wars
will be still
infinitely „
ness
,
more
more
mechanized and
destructive—wit¬
of
wars
destruc¬
lations,
these
germs,
should
defense
our
Pattern of Future Wars
Admitting the conception that
yesterday's wars, and in large part
today's wars, depended mainly for
outcome
upon
the foot sol¬
dier armed with gun and grenade,
that be true for 'tomorrow's
will
engineering
this
fields?
be
And,
done
on
if
tributed—and all consolidated
der
Department
a
of
become
Carter,
the
who
; Reserve
as
teller
a
bank
joined
bank
18
opened
was
of
days be¬
for¬
mally in October, 1914, is retiring
as assistant vice
president the end
the
■
tive and the office of chairman of
the ? board can,: in the discretion
ad¬
of the
vacant.
those
on
of
an
who
directors;: be,, filled
A-A;..A'-AA .' A./ 'A
M. J.; Fortier
or
elected
was
left
-v
a
A;
di¬
rector and
in
vice president serving
capacity of executive as¬
the
interna¬
sistant to the president.
Fortier
patrol or police alert to
has been vice president and gen¬
incipient war prepara¬
eral manager of the Acme White
tions or to quell the disturbance
tional
it
on
gains headway; or, fi¬
those who have lost faith
the
in
good, old, homely virtues
of
goodwill, live and let live,
honest dealing and friendliness,
un¬
Defense?
Thousands
of young men now in
the service and others coming up
as¬
attractive field of service for the
Lead
&
Color
Works,A Detroit,
Sherwin-Williams'
subsidiary.
Robertson,
general
Gordon
Ha
manager
of industrial sales since
1937, succeeds Fortier at Detroit.
The
over
the
inventing
And if the militaristic isolation¬
ist
can
prove
his
before the
case
of
bar
public opinion, if he can
persuade
the
American
public
that compulsory military training
either
is
wise, he
must still justify the taking of a
whole
year
foj;
such
training
rather than, say, six months or
less, broken into two stretches of
necessary
ROTC
in
our
colleges,
administration.
training
In any
hurried
such
In
man
Donald
W.
amply justify the dividend. The
company's
the
business
is
running
highest level in its his- '•
tory with demand for aluminum
castings
continuing
in
volume.
The
ending
operating
a
will
has
results
passed, and the probable ef¬
fectiveness
the
of
be
calmly appraised. In making this
decision, not delay but precipitateness is dangerous.
A
can
peace
show
II. DAVIS
President, The Denver National
the
K.
S.
K.
A
re¬
to
in¬
*
ever
:'.-:.''A
*
/'JA
Wellman, president of S,
Wellman
Co., Cleveland, has
England on a trip re¬
quested by the British Ministry
of
Aircraft Production.
Repre¬
in
Wellman
of
and at
in
the
earlier this year
that time arrangements for
Wellman's visit
sist
visited
M.A.P.
plant
all-metal
be
quired
has
company
*
"
■■
sentatives
Bank, Denver, Colo.
am
heavy
now
best
experienced."
arrived
ROBLIN
year
the
British aircraft.
indisposed to go on to
technical and professional
said
momentous
should
or
Hornbeck
"earnings and financial position
for older
and those unable
A.A
v.,\A
thoroughly in favor of
etc.) but rather for its value in
compulsory military training, with
team work, unity and coordina¬
some modifications.
I think that
tion, tolerance, and the give-andcolleges, both State and private,
take of competitive effort.
And,
men
Aluminum
statement,1 Board Chair¬
a
until the emotionalism of this war
v
&
It will be better to wait
decision.
A I
Bronze
tomorrow.
at
event, we should not be
into
i-National
Foundry Co. has declared a divi¬
dend of 50 cents a share, payable
or
three months each.
were
technical
made to
as¬
development of
friction
.
material
:
-
for
,
college, clude a oneschools,
year's
course
invigorate and enlarge the home
of
military
guard, State militja, and other
training for
military and semi-military organ¬
every student.
A
izations.
This
well-educated young men to serve
as
commissioned and petty offi¬
cers
and
volunteer
a
could
be
provided
perhaps
college
Following an organization
meeting of the New; York Stock
Exchange Committee for the In¬
fantile Paralysis Fund and the de¬
velopment of plans therefor, the
drive in the Stock Exchange com¬
munity was begun on December
18. ; Ail members of the Exchange,
partners and employes of member
over
two
in
years
order to
give
a
full 12
months' train¬
force
reserve
ing. I believe
subject to call!
that students
periods for special train¬
should 'be
ing
to
keep
them abreast
of
given credit
changing war procedures, what if
for this
of officers and men
for short
another
should
war
* Whence,
suddenly?
then,
and
ing equal to
will those
given for
the millions of youth to be
quickly trained for the national
defense?
Answer: from the same
source
to
yielded the 11 million
and, with our allies, to
present war—enlistment
as
fight
win
the
the
drafts
assurances
must
open
If, in spite of the
that the
coming
peace
provide against secret or
preparation for aggression,
blind
war-makers
(better to
say
should
march
fly) again, the draft
surely will have to be employed
as in past wars.
The youth being
trained in the year the war breaks
would certainly not be ade¬
atrophied,ficiency
for
or
firms, and the personnel of the
Exchange will be canvassed. Max
Jacquin, Jr., Assistant Vice-Presi¬
dent of the Stock Exchange, is
train¬
come,
come
quate in numbers
planning
Well,
company reported sales of
through West Point, the Golden Rule, and "the passion
over
$150,000,000 for the year
and air schools, ex¬ for peace" applied to international
ended last Aug. 31. ;
A
A
and geographically dis¬ relationships.
capacity
thinking,
were
Lahr
prevent
nally,
so,
volun¬
a
out
for
and
basis
tary
wars—if they come? Unless men's
and
disputes
or,
again,
at the idea
before
in
Scientific, technical and
new
cannot
not
emphasize ' training
program
home;
scoff
weapons of
and
Germany's belated robot
bomb.
their
A.
Federal
-
and still
destruction de¬
signed to annihilate whole popu¬
gases
newer
function in the arbitration of in¬
ternational
tions, great and small, as effec¬
tively as our courts and arbitral
that future wars—if organizations function here at
Training in Science of War
strategy and machinery of warHaving thus provided for a con¬
making. The peace-loving nations
tinuous
of Europe, not thus
supply of; well-trained,
prepared, fell
one
the
ministration of justice among na¬
Draft Will Serve Purpose
science.
This would also make it possible
for
many
thousands
of young
men to fulfill their basic
military
than
modern
provide also for advanced
instruction
•a
the
and
near
on
Elbert
the
fore
Proof
Van
all of Cincinnati.
Cleveland
training?
The burden of proof rests
Some part of
might well reach
down into our high schools and
academies. Not, basically, for any
special
disciplinary value such
training is assumed to have (phys¬
ical, moral and mental discipline
can be as well, if not better, in¬
culcated through other channels
—the home, school, church, clubs,
A"A"' compulsory military
A ;
basic
rather
neither
this
Eu¬
rope
resulting
sea,
The
•
Arthur
Burden of
Co.,
& Cov,
Isphfording & Co. and
Walter Woody &
Ileimerdinger,
■■
ness
men
Western
and different over-all
more
&
Dahl,
our
will certainly call for
comes,
necessary.
emphasis upon science, his¬
tory, modern languages and busi¬
very
running
in' taking each year
youth from prep¬
aratory and productive effort to
prepare for a war which, if it
demon-
with
it,
t'l er's
rapid
"training under
such
hurly
burly rush
land,
in
reserve
H i
killed in
stuff—unless
Next highest bidders
Roth
then,
tage,
v
So, retorts the militarist, you militarists and those who have no of this month.
are
opposed to regular over-all confidence in the wisdom and
'■/'' *
#
1 .i' "
;"1 ,A;
military training of our youth for foresight of those international
Arthur W. Steudel, president of
the defense of our country and statesmen who will write the com¬
Sherwin-Williams Co. of Cleve¬
our
liberty.
Most certainly not! ing peace in terms which will land, one of the largest
paint
I am protesting, rather, against make
aggression and war-making manufacturers in the world, has
the
assumption that the peace¬ the most difficult and hazardous been renamed to the
position and
makers cannot make a peace that of all human
ventures; or on those becomes chief executive of the
will stick; and if this assumption little isolationists who cannot vis¬
company, formerly held by the
be accepted we shall not make ualize either a
Supreme Interna¬ late George A. Martin as chair¬
the mistake of looking backward tional Council or an International
man of the board. Due to
changes
instead of forward, of training our Supreme
Court, as projected at in the company's regulations, the
youth to fight' yesterday's wars Dumbarton Oaks, which would president is now the
top execu¬
ernize
gins.
men
conditions
we
shooting be¬
Thou¬
a
a
Supplementing these officer
training schools^expand and mod¬
minute
world has ever
mighty serious
frightful Waste of time
good
stratably
we
the world.
women)
all ready to go
places the
Equipment the
business,
be
to
Ohio Brevities
(Continued from page 2810)1
type of warfare. What real advan¬
millions of
of
of wars
technically trained officer all
(and
mechan ized
seen;
should come,
em¬
of young
•complicated
boy
trained for "the kind
used to have" is
life
this
a
large
•hurry- to fight
war
should
have
/with the most
18-year-old
every
the
have
and
we
a
of
out
would elect to remain in it if
years
we
become
had to be
were
20
say,
broiled
Millions
men
if another world
one,
'wars.
taken
year
only valid argument for a sured of further training, and a
Even
with
an
assured
year's compulsory military train-' career.
ing for all American youth is that! Peace there will be a wide and
finished
world
A
production to spend a
arts 6f destruction?
the
The
after
was
declared
two
Miami
strongly in favor of com¬
in
panded
"
I
and
year,
28, 1944
Annapolis,
AA ,A.■
DR. JOHN THOM HOLDS WORTH
Urbana, 111.
pulsory
manpower
will be
Why then take millions
youth from peacetime pur¬
our
and
The former ROTC. system, sus¬
the
pended during the
AA^
more
needed.
not
completing their year of basic
training.
v A'A-A-' •
putting
race.
are
on
upon
us
without
disadvantage
any
armament
agreed
war
dollars
have to undergo
refresher, up-tothe-minute training for the new
more-
deprive
way
no
going to college of the opportunity
to enter officer-candidate schools
obsolete
been
in
those qualified men who
actually declared.
was
number
having "rudimentary
training," yet most of these would
wars
suits
would
gram
accumu¬
lated great numbers of war planes
and war ships, practically all of
When
scientific, mechanized,
Granted that the
preceding classes
of trainees would
augment the
and
(Continued from page 2823)
would doubtless have
surely be
robotized and directed by highlytrained technicians, and less and
Here Are Some More Expressions
On Peacetime Training Proposal
we
will
Thursday, December
military
pro-
this-emergency.
Roblin
H. Davis
Chairman
scholastic
Other
of
the
Committee.
who
comprise
members of the Exchange, part¬
ners of member firms, and presi-r
dents of the community's trade
year after presumably he is ready
organizations, are: Walter J. Basto go to college, it would operate,
sette, Robert J. Bee, Robert P.
in my opinion, very adversely for
Boylan, Harry Bradbury, John L.
the young men of this country.
Clark, Leroy Dando, Elliott D.
Certainly we should have as Fox, James J. Gurney, Eugene A.
many young men as possible en¬ Hayes, Roland L. DeHaan, Richard
joy the advantages of a full four- C. Horn, Lewis Levine, Peter P.
years' college course and, as I McDermott, George J. Scully and
said before, to defer this, in my Anthony J. Shields.
opinion, would be unwise.
work.
My
for holding this
view is that if a young man has to
defer his college entrance for one
Of course,
tails
which
connection
members,
reason
there
I
are
might
with Such
many
go
a
into
de¬
in
program,
but, generally speaking, I am in
of compulsory military
favor
training, with modifications.
i
Volume
160
THE COMMERCIAL
Number 4346
FINANCIAL CHRONICLE
&
stand in high places and urge the
subsidy with American tax dollars
of
foreign sources
of
mineral
Small Mines Securities
wealth.
They would stifle
hard-rock
miner
into
the
aban-f
bonds
as
on
we
too
are
mining
prone to
medium of
as a
investment.
i
exploit the
deposit of
a
neighbor nation whose labor cost
to
banking firms whose names
are still among the most
widely known and best respected
Yet we
in their field of business.
not
do
raise
.
these
of
eyebrow when
dealers bring out an
same
issue
an
usual kind. Should
these dignified names that grace
the
industry of securities dis¬
tribution offer a mining stock, the
-shoulders of many of-their com¬
any
'
would shrug and some
one might give expression to the
thought many would entertain,
-"Has so and so gone nuts?"
,I suppose the reason for the lack
of realism concerning mining as
an
industry is based upon- the
«negative .-virtue -of' ignorance.
1
When the avaricious skeptic who
lost his money in some mining
petitors
-
-
"
later: raised
venture
his voice in
the whole world would
hear,
others, too, joined their
voices with his and " the tumult
protest
.
*
so
and the shouting
still
*
heard
is
breadth of
left
echo that
length: and
an
the
.
fair land. The loser
our
in real estate mortgage issues
and
whose
and
names
enjoyed by all.
(3) Those
producing
the
precious metals, gold
called
silver.
economists
a
ward-^the' mining
prevail.
All of
sacrifice of great
potential; profits
the
promises F of
anger
T
at
which
'
he
sorrow
.
thus
has
denied.
been
In other
words, his cry isjlouder
because of the dashed hopes. He
"
the inves¬
.r has little sympathy for
tor who only
fost his money.
;
"Last winter the Colorado Min-
;
ing
,
than
which
they
metals
come
the
metals
Association and the American
fashioned. These
are
from the good earth
herself, the mother of modern in¬
ventions.
ties
The union of her boun¬
with
the
'
genius
of
man's
with
her
elements.
We
along
drive
highways
in
machines
and precision of
manufacture give to transporta¬
tion
a
new
meaning.
We fly
through the heavens in devices
whose structure, control and di4
.
where
reetional
apparatus
evidence
of
her
of
more
the
but
are
bounty
; ;
and
pentup demand for
consumer goods are but a signal
of the greater need for these boun¬
attended
was"
-
by
"was addressed
of
.president
a
; many
letter from the
States.
United
the
j'Over his signature Mr. Roosevelt
wrote:;
1 >' F'
the
"During
,.
the
v
v
past two
dependence
many .of its
has been amply
Fortunately, the
on
years,
of the Nation
domestic ores
demonstrated,
mining indus-
generosity:':
Vast
accumulations
and
power
ties
of
fer
to
earth
new
;
.
-
"
-
eral
materials essential to
raw
the
*
*
prosecution of the war, laying aside all considerations not
compatible with this prime ob¬
jective until victory is definitely
and irrevocably ours."
sight of the
arduous tasks ahead of us, we
must bear in mind that,the min¬
"Without
losing
ing industry, like agriculture, is
1
*
*
surface
our
knows, when some pros¬
jackass.; pawing through
the snow for grass to nibble on
will
another priceless de¬
uncover
posit of galena
the
ore
great Bunker Hill and
Sullivan lead mine
But
happened
as
discovered
was
few years ago.
a
they forget the millions of
cubic
beneath
miles
visible
the
face of the land.
There
be
developed
found
and
treasures
not
even
Yes, these
new
yet to
are
frontiers
vast,
known.
now
closer
are
than many suspect, far closer than
the distant mountains and stream
beds
where
visible
geology
olayed its treasure to the
ticed
of the covered wagon
While these early day
eyes
oioneer.
orospectors
cross
of
dis-
unprac-
struggling
were
the prairies to
Colorado
waited
and
to
the gold fields
California,
undreamed of in
sabe
.
:FF7_:; ^: j.
Federal
it
ment
to Foster its
can
on
national
that basis."
/ '
■ ■
f.
Who then is to say
.the straight on
him. who ?i still
thinks of mining. as an industry
that deals principally in gold and
silver I will. say, "Your are old
fashioned!Mining
today
is,, a
"-vastly different matter, and - must
'be judged in the light of-modern
metal uses and, industries, polit¬
ical and
international implica¬
.
.
tions.";.-
•••
..
■■
Having in mind this new. con¬
let us
give thanks that others realized
.'the fallacy of deprecating .the in¬
dustry and to them give credit for
cept of the mining industry,
there
are no
frontiers?
new
Who is there to say the mineral
these
be
so
by for¬
raw ma¬
nations.
bold
as
But
to sug¬
mining industry, and in the name
of good neighborliness. Would our
foreign
policy that required turnips from
Turkey or pork from Peru. Would
they subscribe to a plan that re¬
quired Americans to
a
only cot¬
Cleopatra or
use
ton from the land of
wheat from the down under
con¬
tinent of Australia.
:
■
tried
We
this
plan
when
once
Americans wanted oil from Mex¬
There
ico.
expropriation.
again to gain tin
came
tried
We
it
from; Bolivia;
.
Then
tion.
came
revolu¬
Of;'""Vy
also
was
tee
their activities will be'Continu¬
regarded by the Commit¬
the achievement of
as
ously limited, until the overthe-counter market will be en¬
im¬
an
portant safeguard for dealers and
the
in
brokers
trial.
interest of
:yF. F7 yF.-
' ■
'
■■■
tirely erased.
fair
a
,
"This
i
pending
it
once
in
more
de¬
the Malay States for
rubber/Then came the Japs.
:
Now let's use some horse sense.
direction."
5%
Interpretation :y-'V F;
During its consideration oi the
of that part of the SEC
opinion which held that the "5%
philosophy" was an interpretation
within the powers of the SEC,
and not a rule, the Committee was
advised that -such powers of in¬
terpretation were tantamount to
the power to legislate, and that
this was a dangerous precedent
which, if permitted to stand un¬
challenged,
would
enable
the
NASD under the guise of an in¬
terpretation of the "Rules of Fair
Practice" to place almost any re¬
straint upon NASD members, and
through SEC enforcement, upon
the securities industry generally.
lesson
lose
a
that
the
best
way
Exchange
Weekly Firm Changes
The New York Stock Exchange
has announced the
changes::
such
have
friends
in
the
defaulted against
Some
us.
have simply said come and get it.
But this we never do.
Commis¬
admitted
Thomas'
nate
of
in
but
inquiry
the
paid.
end
we
Suppose
finance
have ^inquired,
have
always
for
example we
foreign friends and
our
of them gang up on us.
some
say
there will be
to
T6
speak
no more wars is
of January
as
Mr.
1st.
privilege to act
the floor of the
on
alter¬
exchange
as
for J. Burr Bartram will be with¬
drawn
as
of December 31st.;
,
Leeds
further ad¬
was
,
them, and the taking of a reason¬ will become a limited partner
able profit,
warranted a larger effective January 1st, on which
spread,
y V^F-'\F' FF.F .FF7Fy'yy y date Charles S. Cheston will re¬
tire from partnership in the firm.
No Appeal
Paul
Felix
Warburg, limited
The question arose whether the
failure to appeal from the SEC partner in J. S. Bache & Co., will
order
constitute
Would
a
retire from the firm
perma¬
on
December
77: ;t.y.
31st.
nent bar and
prevent future rais¬
William H. Burnham will retire
ing of the issue whether the "5%
from partnership in Dixon & Co.
philosophy" constituted a rule,
v
Committee
The
such
that
in
Richard H. Sprayregen, a mem-,
ber of the Exchange, will with¬
raised
be
draw from Eisele &
"5%
a
Stout & Co.
•p
J.
7
In
is
brokers
and
Goodbody
&
Co.
on
-
Lloyd S. Miller will retire from
Salomon
business
whose
-
in
31st.
F:Carroll S. Bayne, a member of
the Exchange, will withdraw from
F 7- Luke, Banks & Weeks, on December 31st.
7'v.:v.F'.'
Projected
exclusively over
Murray will retire from part¬
December
ensuing discussion the
for an organization of deal¬
an
need
King, Libaire,
December 31st.
on
Orvipe E. Babcock and Martiii
nership
Over-the-Counter Association
F-y yy'7<,7.
December 31st.
on
advised
was
could
issue
disciplinary
any
wherein
ers
sions
',;'77F '
membership of Edgar Scott^to
Edwin
George Thomas will be
considered by the Exchange on
January 4th. Mr; Scott is a part¬
ner of Montgomery, Scott & Co.,
to
which
Mr. Thomas
is
being
to
past
following firm
'
Transfer of the Stock Exchange
s.
Mitchell, general partner
in Shearson, Hammill & Co., will
vised, however, that the favorable
become a limited partner, effec¬
parts of the opinion placed deal¬
tive Jan. 1, 1945.
ers in a .position to disregard the
y
■; V
Radcliffe Cheston, Jr., general
"5% philosophy" where the na¬
ture of the services rendered by partner in Smith, Barney & Co.,
The Committee
friend is to lend him money;
Many
-
New York Stock
effect
on
the
attempt to organize is
imperative step in the right
an
The Effect of the
V'F -;
Group
2803)
page
which is that of the complainant
proceeding
spread" was at¬
tempted to be enforced.
' 7
1
v
Thereupon a motion was made
and unanimously carried that no
If we finance foreigners to our
appeal be taken from the Com¬
own cost, we will have to relearn
mission's order.
;;F
tried
We
the
-
Bros.
cember 31st.
counter
&
Hutzler
on
De¬
•■>;7'F/' y
■
F
DeWitt J. Manheimer, a member
urged. FF,.':. yF.'
y::F;:,/;;y'
of the Exchange, will withdraw
Committee" expressed its
from Spear & Leeds effective Jan-t
intention to write its eligible sub¬
scribers to form such an organic uary 1st. yF\" yy-F .y.^. Fi;-t> yzation.
F-Fy ..'F v77-\; F^FFF.FF ;
Benjamin & Sternbach will be
was
The
;
with childish words.
When interviewed, Edward A. dissolved effective December 31st,
Two babies sucking at the same
Kole, of counsel to the Commit¬
breast fight to be first if they are
tee, said:
: y.,/
y-FyyF Exhibit of Resources
hungry. The effort of survival is
"Over-the-counter dealers
primitive. Man in the last analysis
and
brokers
have
problems of the States on Display
,
is primitive. Realism rules. Where
will
ucts,
other materials and leave
mestic
industries
Fair
for the aggressor of a com¬
ing generation.
Against these competing sources
game
miners
our
will
in
run
of the
At Colonial Trust
trade,
they
which
in
market
Arthur S.
the Colonial Trust Co., announced
ities, which latter market consists in the matching of orders,
\
homa is
Vand
on
a
over-the-counter
"The
friendly?
tlemen.
The
called
fulfill
to
What
their
if
they
I leave it to
F,'
;
were
as
being regulated by organ¬
the bulk of whose
members business is in listed
securities., This is not just.
"It is also being invaded by
you
con¬
fair and untrue
statement I
be
those
wolves
and
in
take
emphatic issue. If, however, there
is anything connected with the
industry to which that term might
fairly be applied, it would have
to
gether
jackals
my
tured
upon
said:
vocabulary
uble
and with a vol¬
pershades the
our
of
hausted, just because they are not
visaged by the naked eye?
y
t
sentiality as a* basis for lurid
promises and unreasoning and im¬
possible
assurances
of
gain.
Against these prowlers of the pub¬
human
other fields
of that
and •manufac¬
In commenting
the display, Mr. Kleeman
"We are offering the use of
windows
and
the
to
oy
of
the
|>eoartment
ther Industrial
each >of
the
Territories,
43
be¬
Freudian phrase, are
lic purse we wage relentless wart
To be sure their ilk is found in
The
agriculture
Commerce
States
pot of gold from the end of a
rainbow which he is now mag¬
the
who have seized upon its very es¬
the
products.
Commission
that be has in his grasp
unwary
ex¬
in
"Resources of the States."
stock,
protect their, rights,
opinion, the sphere of
to
of widows' mites
Rockefeller
second
photographs and acutal materials,
and embraces oil, minerals, live¬
listing privileges.
F> "Unless over - the - counter
dealers, and brokers band to¬
mining industry has been
predatooy; With this un¬
the
the De¬
partment
of Commerce of the
State of New York, appeared a
few weeks ago.
The Oklahoma
exhibit takes the form of murals,
porary
.
office
first display, arranged for
for tem¬
exchange applications
un¬
gen¬
bank's
the
bank's series of exhibits described
mar-
izations,
failed
showing in the Win¬
now
of
Center
y ket is
Friendly nations, Mexico, Bo¬
livia, the British Empire Malay
Dec. 26 that the State of Okla¬
dows
only where
large distribution.
possible
is
there is
leaden
shoes.
Kleeman, President of
largely inapplicable to the
auction market of listed secur¬
and
do¬
our
prostrate.
characteristic
uniquely
country be
when we
stockpiles of foreign prod¬
whether of mineral or of
our
build
were
of the Ozark hills.
develop¬
V
in
seeking release from
their prisons on the eroded slopes
sas
.Now, let
this
us get
matter.
To:,
Opened
us
farmers be content with
tracts.
Government should do
the
to
from
States
lead lay under the
in
Missouri,
coal
Illinois and the now
to settle lend-
or
that Americans drive cars
of Russian, manufacture or
dress
only in fabrics from far
Cathay? Yet this is what is being
urged in high places against the
the Mis-
Range,
grass
lands
us
only
iron
known mineral deposits in Arkan¬
all
".
re¬
welfare,
in peace as well as in war. To
exist and prosper, our'Nation
must have a strong and self.sustaining mining industry. The
basic
F
of
acres
they
For who
in Idaho
,
Even if
are
pector's
when
during this extraordinary period, the metals and minerals
that have made possible the record production of ships, guns,
tanks, airplanes, and the other
weapons of war. We will have
to continue to produce the min¬
there
say
they hardly tell the truth.
premiums, and other forms of
aid, has been able to provide,
-
buying
,
frontiers
try, with the help of Government
loans,
subsidies,
price
/.
of
soil.
thoughtless
no new
-
a
our
The
,y
<
the
gest
safety
whose
names are prominent
in ,politics
and government. To this .meeting
"
terials
who would
ma¬
out of
that
eign nations is to accept
ways of life depend upon
machines and these machines are
better
answered
lease obligations owed
terial
no
/,••;;•
be
may
accounts due
must
Mining Congress held a joint con¬
ference in Denver. This meeting
*
It
only way to balance foreign trade
era
modern
their
and
men
of life?
If this
industry
our
I
these
ask why should out
be used to underming
their right to the American way
realistic attitude to¬
more
people. LaT
mines, I am
own
tax money
are
^
our
of
families,
and
shimmering steel rails reinforced
his
to
interest
true, and I feel confident it isj
then
of
advised, amount to 60% of pro-t
duction values, in addition to all
the legion forms of taxes. In the
pretty well
agreed that America stands upon
be
ouj;
(Continued from
of livelihood for literally
bor costs in American
so-
the threshold, of the greatest
in her glorious history.
carried
conclusion tend to eliminate
a
millions
7y:7'F/Fyi y.yy' /yyF'F y
r
The
unreason¬
a means
^
■
adds
addition
in
to
unknown to most but needed and
scientific mind gives the fruitfulness we all
enjoy. We ride over
j
citizens, and will if
all but
uses are
few cents per day poses
a
problem of unfair and
able competition against our own
_
foreign credits w mayhave been
sorry for his losses, but the cred¬
ulous speculator in mining stocks
■
of but
a
cessities, coal, iron ore, copper,
lead, zinc, clay, salt, potash, etc. j
(2) Those producing
strategic
metals, and alloys, including mo-|
lybdenum,
manganese,
nickel,
bauxite,
chromium,
platinum,
tungsten,
vanadium, - antimony ^
fluorspar and many* many others
and titles
-
of our wars and for
making of our living stand¬
: ards whaP-fiaey are today.
Mines may be classified in three
principal\groups;,
~
J
(1) ThoSe-^iToducing basic ne¬
memory
"ment
.
the winning
the
is ^so alert to the
foreign credits sold
American investors by inveSt-
My
7 billions lost in
Plans Permanent "Counter"
and
(Continued from page 2803)
frown
Securities Dealeis Committee
our own
donment of his hard worked mine
1
2825
of
resources
To 'us
our
who
-
land
are
supervise
the
flow
of canital into industry is thrown
a
challenge.
skeptic or
thoughtless.
clear
aid
our
in
The responsibility is
the pitfall of the
the morass
of
the
That challenge is to
avoid
to
ours
heads
every
of prejudice
legal
way
the
and
hit
this
whenever
I
en¬
spoke
couragement of the economic wel¬
as
fare
is this
our
of
industry
all depends."
-
There
an
are
upon
among us
>
•
which
- '
-
a
well and
as
enemy
we
a
can
we
must
wherever
and
-find
moment
clothes
<
of
man
ago
primitive animal.
more
him.
Nowhere
true than when
himself
with
those who suavity and becomes
man
the garb
a
of
marauder
cause
tunity to
nanimously offering for a penny
a
share,
trade.
social.
man's
what
or
Such
:
.
as
.
have
these,
to
you
use
we
believe such
an
oppor¬
place before thousands
the resources of
of New Yorkers
to
each Commonwealth will be bene¬
a
morally un¬ ficial to New York, the world's
They lack the milk of greatest market ■ place, and Will
kindness and in the pursuit further peace-time trade through¬
vicious vocation, exemplify out
the
country.
Interspersed
with the United States series, pur
inhumanity to man;
Fortunately,
our
laws,
both Foreign Division is miking availFederal and State, now have au-* able
a like opportunity to the
fboritv
to
ho]d
in check their . countries of Latin America, artel
Let us as enforcers
laws, learn discrimina-
depredations.
of
these
w0n.
•
'•
,
to those nations in other parts of
the world where we now maintain correspondent relationships."
1941
Fraud
the Seller of Securities
on
aware
1942
(Continued from page 2803)
met
wide variety of fraudulent
a
schemes
designed
circumvent
to
the obvious intent and wording of
with
connection
purchase
the
follows:
chase
directly or indirectly,
by the use of any means or in¬
have found in our
we
person,
experience that the ingenuity of
worth¬
less ventures for their own profit
those who seek to promote
is not limited by any
Securities
sought inva¬
Statutes,
statement of
riably to disguise their fraudulent
sale
of securities.
However, at
that time I limited myself to a
discussion of fraud in the sale of
which they were
however, which needs
protection from those who would
take advantage of their position.
This class consists of those who
have a security to sell. It is about
explore to the same extent as in
the buyer
of securities. For that reason we
the field of fraud upon
the
have
not
well
same
de¬
veloped -pattern of corrective ac¬
tion and remedies that we are ac¬
customed to in the other field.
I
As
conceived
and we have
duty as one of pro¬
it
see
you
our
wasteful
tecting the public from
exploitation. Is there any differ¬
ence
in protecting people from
purchasing securities from highly
skilled promoters, who are pastmasters in the art of playing on
foibles, than there is
human
the
hvprotecting
persons
who have
ventured into the securities field
from
cious
securities
those
selling
to
who adopt almost as vi¬
technique in persuading
persons
a
Consequently, in today's discus¬
sion I will no more than briefly
refer to a few provisions of the
•
1933 and 1934 Aus,
solely in order
developments
campaign against securities
to emphasize recent
in the
frauds.,
:•'
_
I
.Qetierally. speaking, the first of
the Securities Act of
1933, was designed to bring about
adequate disclosure of the nature
of securities to be offered for sale
prevent fraud
distribution
in their
sale.
or
Al¬
though certain securities and cer¬
transactions are ex¬
empted from the registration pro¬
tain security
that Act, there are no
of
visions
exemptions
from
its
the plan of liquidation. Im¬
mediately thereafter, the control¬
on
anti-fraud
section, Section 17(a).
talk
because
to
about
inquiries
you
many
great public interest in
application of this rule have
been; sent to the Commission.
I
would like to present to you the
not
These
cases.
is
cases
are
in
not
any
drawn from facts. As Judge
the
of
the approximate
Lamb
to
this
of
Court
Supreme
The Securities Exchange Act of
T934; and
its
is
"Fraud
Fraud
kaleidoscopic, in¬
being infinite and
in
trading
and
chase
subsequent
selves
paid
amend¬
hard
defining it with a
and fast definition, their
by
jurisdiction
would
be
cun¬
ningly circumvented at once by
new schemes beyond the defini¬
Messieurs, the fraud-feawould like nothing half so
as for
courts to say they
tion.
>
sors,
well
thus far, and
pursuit."1
little
A
the
after
than
more
year
a
of the
published
securities—on
the over-the-counter
markets,
port on its
investigation
a
re¬
concern¬
ing "The Repurchase and Retire¬
of
Truck
LaFrance
Ward
Stock." Therein, it
its
opinion
on
the
standards of fair play imposed by
also
gave
the rule.
prior Act.
was
rule,' by
known
as
provisions of the
One step in that direc¬
promulgation of a
the
Commission, now
Rule X-15C1-2, adopted
the
pursuant to Section 15(c) of the
1934 Act.
That Rule prohibits
fraud
by
brokers and dealers in
purchase of se¬
either the sale or
curities.
Another loophole, how¬
still to be closed in the
protections administered by the
ever, was
Commission.
that
The
step
to
close
loophole was taken in May,
1942, when the Commission, act¬
pursuant to Sections 10(b)
and
23(a) of the Act, adopted
Rule X-10B-5.
This Rule em¬
bodies the broad anti-fraud pro¬
visions of Section
17(a) of the
ing
1933
hibits
Act, and specifically pro¬
fraud by any person in
acted
control
who
entered negotiations
with
Salta
Corporation with a
view to selling their interest and
Corporation
the
merging
Salta.
and
Truck
Those
Corporation
officers during
the period of negotiation, after
it
appeared probable that the deal
would be consummated, and well
real Value of their interest in the
that the identity
of the purchasers should not be
disclosed.;
This
completed the
of the
use
of inside infor¬
completely
insiders,
by
of
was
a
timely and adequate dis¬
of the facts I have men¬
make
the
The Commission held that
purchase
of securities
circumstances
such
under
unaccom¬
panied by appropriate disclosure
material
of
facts
its
constituted
a
it
the
purchase
over-the-counter
chases
market! through
istered
the
had
increased
purchased
themselves.
shares
percentage of
shares
the
During
that
obtained
were
at
"for
period
prices
reg¬
ranging from approximately $3 to
per
share/ None of the' stock¬
holders
were
who
sold
their
shares
advised that the Truck Cor¬
was the
ultimate pur¬
They were not told of
the negotiations to sell the con¬
trolling shares at approximately
$45 per share, and of the liquida¬
tion I of
the Truck Corporation.
poration
chaser.
There
was
no
disclosure
of
the
amount to be
paid on liquidation,
approximately $25. Nor were they
informed of the greatly improved
earnings—although tjhey had re¬
ceived
financial
statements
in
.
release
the Commission has
been issued. Although no public¬
by
ity has been given as yet to the
facts
in the cases which I am
about to present,
list which he" Supplied.,
a
identity
well
illustrated
and
purchases
the
after
ers.
the standards of fair
or
instrumentalities
commerce,
Stonemets
v.
Head,
243; 154 S.W. 108 (1913).
248
Mo.
/
play it im¬
In all the following cases, of
course, as in the Ward LaFrance
case/the necessary requisite of
jurisdiction, the use of the mails
Let
cases.
me
A
were
of
interstate
present.
describe
' ' *
some
director, who
of
was
Purchases
-
counter
*
market
registered
a
who
in
effected
were
the
over *
broker-
circularized
stock¬
a
the identity of the purchaser or of
the fact that the snares were be¬
an¬
market
price of the securities was greatly
ing purchased for the
enhanced.
the
Regardless of this director's lia¬
bility under applicable State law,
our consideration Was necessarily
resold at cost.
governed by Rule X-10B-5. Here;
as
in the Ward LaFrance case,
inadequate
the
issuer
which
the
could
of
intel¬
an
ligent judgment with
respect to
the valued of their securities. Any
clue as to the identity of the pur¬
chaser which might have led them
to make inquiries .of him or the
company
was
effectively
con¬
cealed. His failurefto disclose his
identity of course-enabled him
to abuse completely the use of
information^_JL.,, follows
inside
therefrom
that
securities
under
of
purchase
the
circum¬
such
unaccompanied by appro¬
stances
;
its
to
the
shares
to the formation
submitted
annually, they were
as they failed to re¬
outstanding number of
shares, giving thereby no basis by
flect
The director
tial
of ;
were
stockholders
public security holders were
of.
benefit
they
Although financial
were
withheld facts which were essen¬
taken advantage
whom
to
statements
book
value
of
the
determined
be
and
indication
no
of the repurchase
Furthermore, without
to
a
profit and loss
program.
reference
which
statement
only
furnished
was
shareholders
request,
upon
had
no indication of the improved
earnings. And it was those earn¬
ings that supplied the monies for
the
repurchase
of
securities
its
than
rather
being distributed to
as dividends, which,
particular case, as I recall,
shareholders
in this
in
were
the
with
arrears
to
respect
preferred stock. /"/.■
priate disclosure of material facts
fraud
a
was
upon
the
of
violation
The security holders of this' is¬
the-seller and suer could not have made an in¬
provisions of telligent judgment- with respect
X-10B-5.
engaged in such transactions with
knowledge of such omissions vio¬
late
Rule X-10B-5~ aswell
as
X-15C1-2.
Rule
T
the
glad
am
the
to
Hence, any brokbr-dealers who
~
to
say
closure
to
the
deceit
balance
sheet
indication
And,
chase
of
stockholders from whom he
to all
securities
financial
dis¬
cor¬
in
the
included
an
inherent
with
were
its
improved
here too,
shares
its
the
earn¬
repur¬
by the issuer
funds not only
own
the
creased
and
its
of
ings.
rescission
the
of
condition of their company, a
closure which should have
of¬
extended
attention of the; director,
of
their
of
them
to
.
when
that
were" called
conclusions
value
without timely and adequate dis¬
rected
in¬
had
purchased stock.
Now,, illustrative of cases in¬
volving the repurchase of securi¬
the
value of the outstanding shares
held by the company in control.
ties
In
A
vent
by an issuer, .this situation:
foreign municipality consulted
with a registered
broker-dealer
with
of
respect
the redemption
to
bond issue which was in de¬
a
interest/-
to
er-dealer
Arrange¬
made with the brok¬
advertise
to
the
for
and to
past due interest thereon,
purchases were for
of
certain
banks.
that
indicate
account
the
been
great many™"B6nds had
purchased tlm issuer, in
devised
a
so
redeemed
broker-dealer,
by
the
the
remainder of-the outstanding
bonds at the face amount plus
that
fact
The
available
identity of the purchaser and the
be-
fact that the purchases were
Ihg made for the account of the
Consequently, not only
the fact that the issuer was
issuer.
was
repurchasing completely camou¬
flaged but the identity of the
company in control which made
the purchases was also effectively
screened. Thus, shareholders were
at
a
complete disadvantage in
dealing with their own corpora¬
tion and those in control.
^
monies
were
issuer to
bonds at
its
The
I
have
a
dis¬
its
nondisclosure of
necessary
identity
,
true
of thb issuer
purchaser
as
monies
were
prevented
available,
the
there
was
an
deliberately
depressed
of the
inadequate disclosure
condition
of
pany
and
the
by
fi~ /
com¬
withholding divi¬
retention
of which
by
the
dends,
could clearly serve no proper cor¬
porate purpose, at the same time
using
such
But, repurchase
failure
to disclose the identity of the pur¬
chaser.
have
an
control—to
in
the
here, not'onlv was/there a
Fur¬
issuer—and
repurchase
securities at prices which they
of
program
those
the
that
thereby
transactions.
Rule X-10B-5.
nancial
placing them at a disadvantage-in
deah*\g with
the-Veker-deaW
handling
of
thermore, when such omissions of
material facts are part of a plan
past due interest, was com¬
pletely unknown Xo bondholders
The
described, unaccom¬
appropriate disclosure
facts, constituted a
material
violation
or
the
securities
just
panied by
redeem
them at their face amount plus
count and subsequently to
of
purchase
therefore under the circumstances
of
enabfe the
to
repurchase
the
thereon.
due
interest
but
percentage
addition, in order to circum¬
inquiries by shareholders, it
was
necessary
to
conceal
the
accordance with the plan
surplus earnings to
its securities to the
.
disadvantage of the public share¬
holders
affirmative
representation that someone else
also was the purchaser which acted
the
frorp
list supplied by the
issuer. Disclosure was not made of
bondholders from discovering
poses,
stock of the issuer
through
course
the
facts,
ih-
an
issuer purchased
consisting of preferred and
the
' publicly
company
those
nounced
situation
,
of
holders from
dividendC ^'Pf
X-
issuer:. A company in
an
dealer
imminent
Rule
outstanding public sharehold¬
The
were
another
of the sale and of tjie fact of the
with
to
is
made without disclosing the terms
the
respect
employed
meaning- of
////a..;
common
its
was
purchaser
the
of
concealed..
I think you will
the Rule
find the requirements of
has .been
the
by
units
broker-dealers, some of
stockholders
were
$165,000 and insured shareholders
participation in the benefits of
their company's earnings.
This is the only case arising
under the Rule in which a public
circumstances,
opinion that a scheme
my
control
circularized
whom
as
parties of the shares
purchased from such stockholders
or the amount paid public stock¬
holders on liquidation. Such pay¬
ments amounted to approximately
an
such
defraud
ties
low, prices
the-counter
from
effected at the pre¬
fin the over-
were
vailing
fault
cost to those
ma¬
further¬
plan or program of
a
under
Here
Pur¬
After
to
in
volving the repurchase of securi¬
manyfweeks
mately $35.98 per share and the.
broker-dealer
is
to
market
figures at which it
of
made
are
ing public security fiolders.
ments
parties
facts
ance
misrepresenta¬
omissions to state
10B-5.
brought
these facts to the attention of the
Commission
the
terial
paid
be
Furthermore,
affirmative
and
he purchased a considerable num¬
ber of shares from $the outstand¬
violation of Rule X-10B-5.
After
of
terms*/ and
dividendg/to
fraud
a
within
fers
There
'
X-10B-5.
later,
corporation.
the issuer and those in control to
when
issuer
ment
issuer under such cir¬
an
Rule
contract but before Lie announce¬
these
,//■///'
clear necessity for
by
corporation of the
of stat|. law to deal¬
of the |ssuer. Never¬
imminent
of securi¬
purcnase
the seller and in violation
upon
of
applicability
ings in stock
theless, after the- approval of the
shutting off any light the share¬
holders might have had. as to
what was taking place in their
/
advised
tions
necessary
abuse
t|e proceeds of
waa
the
counsel to
corporation. '■;/•/ z/:/ '/•/ :'•■// / •,
In order to conceal these facta, Rule
was
paid
be
wasp to
He
sale.
that
by
the
to state material facts was
the account of the Truck Cor¬
of the
poration its publicly held shares.
1
dividend
ing
stockholders from
that
accomplished by
a
misrepresentation ■. and a failure
approved by the Board
of Directors and thfet a liquidat¬
in
it
fore
municipality's bonds /at a flat
price considerably-less than the
face amount of the bonds and the
the
x>r
$6
upon
leaving
by
corporation,
involved,
arrangements
were
made by the two officers
and directors, by the Truck Cor¬
poration and by Great American,
to
pay
the public stockholders
the difference between approxi¬
aware
in
deceit
them
completely in the dark as to the
in control of the Truck
were
paid those in
a
as
shareholders
tioned.
strepgthdh the fraud prevention
tion
actually
closure
case
their outstanding holdings and the
value thereof almost as if they
disclosure
and
two officers
In that
This
and
of
ure
Corporation
and' to
regulate brokers and deal¬
ers'/1 Also, they were designed to
their
of
value
liquidation, non-disclos¬
the amount likely to be
mation
rule,
adoption
Commission
the
fur¬
no
irt its
ther
tered
pur¬
national securities exchanges and
in
book
shares in
would
probably be made,
au¬
thorized an employee of a regis¬
of
the
ceive
taking on protean form at will,
were
courts
to
cramp
them¬
designed to regulate
sale
the
to
known
securities—the
were
which
facts
were
purchasers.
Al¬
though shareholders were to re¬
liquidation,
State said:
finite.
proposed liquidation and
price to be paid
stockholders thereon upon that
close the
conclusion to be
a
which
and
control,
over, to deal fairly with share¬
holders it was necessary to dis¬
as
It is but
fact.
operating
current
available to Salta by
made
were
be
to
way
as
them, stockholders could not have
acted intelligently with reference
to the sale of their stock.
More¬
delimiting the extent of
the rule. Fraud of itself is not a
taken
the
in
those
to
facts of these
of the
of
closure
hypothetical
situations.
I
emphasize, however, that
recitation
by Great American
majority stockholder.
results in 1942 which were known
want to
a
plan was accordingly
The
It is clear that without the dis¬
the
of several
its
changed
approved
the
showing
facts
to
Inc.,
Industries,
Salta ' had
which
.to
transferred
were
American
Great
purchase
security."
;
ments
shares
.
the1 Acts,
to the public and to
stockholders' meeting to act
a
ling
to
choose
this
ment
/':,■.///
of
deceit upon
or
of the directors' action and
them
name.
would go
I think not.
ceit?
fraud
a
of any
sale
or
their invest¬
nondisclosure and de¬
by
as
proxies to stockholders of
Corporation informing
the Truck
in connection with the
the sellers to give up
ment
with
;
any person,
I wish to talk to you
thought, but a field in which we
have not had an opportunity to
do
erate
Corporation to approve
plan of liquidation and then
sent
an
announcement together
the
(3) To engage in any act,
practice, or course of business
which operates or would op¬
persons,
It is a subject to which
enforcement agencies have given
the Truck
made, not mis-
leading; or
the sale of secur¬
ities—that is, fraud on the pur¬
chaser. There is another class of
curities,"
the
of
closing date the of¬
the
a
shareholders
signing of the contract.
ficers, who were directors as well,
caused the Board of Directors of
statements
only in
those persons
or
material fact
a
there-.
doubt
cumstances
purchasing shares for the
Corporation and to pur¬
for Salta. Between the sign¬
After
in order to make the
made, in the light
circumstances
under
necessary
a«security. The anti-fraud section
the Securities Act proscribes
today; specifically, I wish to dis¬
cuss
"Fraud on the Seller of Se¬
untrue
any
material fact
a
state
to omit to
of
fraud
make
(2) To
ties
mated and
the other facts concealed prior to
the
little
be
can
valuable assets had .been consum¬
of the new purchaser or of
tity
employ any device,
scheme, or artifice to defraud;
deceit upon the bondholders.
a
There
$15.75.
varying prices as low as $6 per
share. But still no disclosure was
made to stockholders of the iden¬
(1) To
as
of
trustee
signed,
at
of the mails, or any
or
merce,
voting
contract was
the clos¬
ing date, Salta purchased shares
faciliity of any national secur¬
ities exchange—
statutory at¬
tempt to prohibit their activities.
As I recall it, we found that some ]
modern
promoters, superficially'
well-versed in the wording of the
and
approximately
the
ing of the contract and
strumentality of interstate com¬
officer
an
knew that a very
favorable contract for the sale of
to cease
z
"It shall be unlawful for any
You and
of
were ./not
earnings per share in
the broker-dealer was authorized
Truck
the Act.
earnings
they
share,
were
After
or
The Rule reads
sale of securities.
as
per
that
showed
which
$2.75
Thursday, December 28,' 1944
FINANCIAL CHRONICLE
THE COMMERCIAL &
2826
those in
that
a
and
to
the
advantage
control, it is
my
of
opinion
scheme to defraud has been
Volume
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4346
160
licly made statements, When con¬
sidering such' statments it would
be well to bear in mind that it
employed within the meaning of
Rule
X-1QB-5.
There
■
are
I would like to
which
tention
curities
three
now
bring to
also
traded
in
counter market.
A
that
eases
tenders
se¬
over-the-
connection? I pail to mind a sit¬
uation where; valuable ore de¬
posits -were discovered on the
The first is this:
issued calls for
portion of its bonds
of
a
acceptable price.
Notices
accompanying
the
re¬
quests for tenders gave certain
information with respect to the
value of the bonds. However, un¬
disclosed to bondholders, the pre¬
vailing market price of the bonds
was considerably higher than the
maximum acceptable call price'at
the time tenders were requested.
In the second instance, control-*'
a
property of £ mining corporation.
Announcement
was
made
in
Western mining publications but
received little notice in the east
where several stockholders sold
maximum
the
should
of
terms
agreement
well
come
within the
about
as
Rule, as
necessity for
the
representations
which
upon
to
predicate such, omissions. Sharp
tongued in tent,, to take ^advantage
of security holders and to induce
them to sell* may well devise ways
and means of avoiding any affirm¬
ac¬
ative
You cariwvell
the close¬
see
of such
-dealings to schemes
defraud. It appears to me, then,
ness
shareholders, the
prevailing: market price at the
time of the offer was substantially
higher than the offering price.
within the
representations
Rule.
such
to
apparent
Would
companied the offer submitted to
the
shareholders.
Again undis¬
closed
i£ made.
therefore' that
treatises could be
written upon the subject of ma¬
terial facts, the omission of which
is
It
whereby
the
that] some sort of pub¬
philosophical
control
was acquired, offered to purchase
the shares of the outstanding pub¬
lic shareholders at the same price
per share at which control had
been acquired. Complete financial
statements and a notice detailing
the
not
fact
mere
too
lic statement
of a company,
with the terms of
agreement
So
prices.
stockholders
in accordance
prevailing low
much reliance
be! placed upon the
their shares at; the
•
ling
to
the
that
protection
of
measure
to
Congress *; desired
investor can
afford tne
only be ob¬
an
publie
Offer to purchase the securities of
tained
the
pany
fraught with danger to unscrupu¬
lous
devices"" of any person in
connection wiffi the purchase and
a
sale of securities.
third instance involved
The
i
outstanding
of
holders
public security
by a com¬
issuer
an
which had recently acquired
larger block of shares from for¬
officers and directors.
mer
It
was
pursuant to the terms of the
agreement for the purchase of
that large block of shares that the
same price per share was offered
stockholders.
to
The
v
offer
set
forth the details of the agreement
of
purchase and its time
was ex¬
tended in order to allow financial
statements of the company to be
Submitted to its shareholders. And
; more,;
undisclosed to» the
shareholders, the prevailing mar¬
once
ket
price at the time of the offer
considerably higher than the
offering price.
**'.7;/7;v '7
Was
offer
to
purchase- securities at a
accompanied by represen¬
price,
tations
to the value of the
as
under
flexible ;
a
rule
omission
made
to
in violation
state
constitutes
*
rule.
*
*; Were we to do so, a
certain class of gentlemen
of Rule X-10B-5.
These matters
Rufus7 Wallingford'
devious
a
of the
type—
the
attention
the
after
had
offers
been
holders. How¬
ever, the situation was rectified.
All
security
holders
who had
their
tendered
offer
securities
payment
were
market
and
informed that
a
prevailed
price
re¬
to the
higher
pursuant
at
of
it arises."2"
-777. 7 '■7 t' .7 /7\;/7'/''; '•'';
<
2 State
v.
Whitaker, 118 Oregon
*
656, 247 Pacific 1077, 1079.
sub¬
mitted to security
ceived
way
>
Commission
the
of
and ^shadowy
evading the^lstw. It is more ad¬
visable to deal with each case as
an
brought to
were
the
77-v:;•„
change in the income struc¬
The
thought to you from the
viewpoint of the realtor—that you
make plans now for those areas
where
you
think
neW homes
should be erected, and that you
be able to present to those who
interested
are
venture
repercussions
that
invest¬
equity
on
be called
by another name, "Venture Capi¬
tal;"
The
TNEC
recent
of
studies
indicated that 80%
the
of the
nation's savings came from those
families which earned
$5,000
more
than
And those
earning $20,000—that is, gross—a
year, or three-tenths of one per
cent of the nation's families, saved
one-half of their income, and ac¬
per
for
counted
total
annum.
40%
of the
nation's
savings.
Now
I
will
not
try to explain
what income taxes have done (and
continue
will
to
people
$5,000
a
year. .While it is an admitted
fact that the income pressure has
been from the top downward, yet
whose
incomes
do)
to
above
are
it has also been from the bottom
upward;
in
other
been the purpose
words, it has
of the govern¬
ment to raise the incomes of those
is relatively
greater than it ever
generally
purchaser; has
b(een accompanied by other cir¬
make
.which
cumstances
omission material.
that
Such non-dis¬
closure, even though no affirma¬
tive misrepresentations.be made,
often
fraud,
activates
to
de¬
those,
sit¬
schemes
in
particularly
uations when the securities being
repurchased
are,
example,
for
gentlemen invest in
constitutes no reason
for your neglecting the venture
capital angle—for without the in¬
vestment of venture capital, you
will not only fail to grow, but you
will inevitably decline
Another thought! The average
you
real
estate
By
view
(Continued from page 2711)
Americap Bankers Associa¬
in the
the
row" kind of
inherent
in
financing
.
the
new
certain
bill
in
the event
of
suc¬
Fashion Park Attractive
detailed7 study
Linburn
of course, disclosure
issuer
is
purchasing
might well be
in
annual
sufficient if made,
statements to
holders or by reason
security
of other pub¬
.are
interested
in
building
and
of
mons,
the
Comoany,
loans, investigate the condi¬
Brooklyn, to form Manu¬ tion of the "horse"
(if I may use
facturers
Trim Company.
Mr."
this simile) instead of tinkering
Brennen's father, the late John H.
around, with the buggy that has to
Brennen, wa| Treasurer of the
be drawn by the horse.
And the
City of Brooklyn before it was "horse" here is venture
capital.
incorporated ;as one of the Bor¬
As you all know, the majority
oughs of Greater New York. !
of builders
have
comparatively
small business organizations.
A
also
Inc./ Is
that
fellow.
a
of
Fashion
contained
in a
special circular prenared bv Si¬
St., New York.
&
Co., 25
Broad
Copies of this in¬
teresting s+udv mpv he had from
the firm
upon
request.
large builder may erect 50 or 150
a year—but most of them
do well if they put up 10 or 20.
homes
So
builders
as
a
whole
have the organization or
nomic
you
background
do
the
type
mind
that you gentlemen are1
only in business to render a
not
service
to
yourselves, but to the
well; research into the
possibilities of expanding and in¬
nation
as
creasing the amount of venture
capital; and
research
into
all
those
real
factors
which
in
estate
will
affect
world
our
of
to¬
morrow.
And
another
as
plank, I would
like to suggest to you the invest¬
igation of the possibility of con¬
building and loan as¬
sociations of muti-family housing
struction by
that I mentioned before.
There
are so many things to be
during the next few years
that they seem almost endess in
done
number; but to hope that
do
can
stand
business
that
the
on
did
we
alt
we
same
old
business
on
purchase real estate from the
angle of investment for a period
of 20 or 30 years; most of them
count on obtaining the return of
their equity money within a pe¬
during the 192G's is not only folly,
riod of from four to five years.
In the good years, these buyers
dying, but the antithesis as well.
Too many building and loan asso¬
ciations are living in the horseand-buggy age—while the world
of planes and helicopters is with
us—now—today!
ers
take- out all they cap, and in
bad years they still take out
but
inconceivable.
time
not
that
It
is
realized
we
about
It
that
is
only the theses of the nine¬
century that are dead or
teenth
the
all
they can, and milk the properties
at the same time.
Truly, that is
not a pleasant thing, to contem¬
plate—but it is a fact that never¬
paper,
theless exists.;;.
ago, on the
'
with
that,
confronted with changed
Moreover,* coupled
are
we
and
social
economic
conditions,
The British Government's white
released but a week or so
future of land in Great
Britain,
is
mute
evidence
of
changes that may be expected all
over
wherein the overall size of multi-
family dwellings, such as
apart¬
fact, a
ments, is increasing.
In
plot 100 x 100 in size, improved
with
a
six-story elevator apart¬
compete either
ment,, cannot
the
of cost
basis
with
an
area
several
tioned.
As
a
or
apartment
times
we
have
projects.
not to be
by
be
can
discerned.
that confront
us
that
The
jobs
in the future
are
of Lewis
come
to
see
in
PARKCHESTERS and other sim
are
still
are
economic movements
covering an
that
men¬
years, some of the large
life insurance companies. erecting
operated
broad
ev¬
tremendous, and it is about time
recent
alar
cannot anticipate
nevertheless there
we
erything,
on
maintenance
■1;77 7- 7>777
result of these and other
factors,
the world.
While
These properties
sold; they are to be
the life insurance
realized, to quote the words
Mumford, that "our task
is that of replacing an outworn
civilization.
The question is not
how much of the super-structure
should be replaced, but how much
we
of the foundation
a
can
be used for
set of purposes and a
new
cally different mode of life."
In
to real estate and
lending, we must turn
respect
mortgage
faces
our
not
radi¬
'
to
isfied
horizons.
new
enough that
with
any
compromise
which
leave
Disraeli
as
us
It
is
should be sat¬
hermaphroditic
we
would
is
only
said
to
have remarked about the mule—
.
industry" (and building is new
industry) "the less likely is he, as
he weighs the possible losses in¬
volved in failure against the tax
who
with the Citizens Trust
Park,
Ordinarily,
been a
tomor¬
Few buy¬
present
tion for maiay^years and
first Chairman of the/
dividend
arrearages.
particularly
.7v-;■;7'."7r.';7-h/•-'"•v 77
of
.
risks
Mfrsijrusf Go. If
A
with
investor,
in the New York area, has
"chicken today, feathers
tax
structure—and I quote here the
words of Mr. Charles C. Abbott
In
his economic status to afford
Brennen Elected
bonds in default as to interest or
sto^k
The fact
companies until, due to age and
obsolescence, they are demolished.
The savings banks, as you all
know, are now planning to erect,
at a meeting of the American Ecof either singly or in combination,
nomic Association in 1941—'
large slum clearance projects. So
a
new
promotion must promise, I would like to ask, why is this
quickly, an annual return of 15 not feasible from the viewpoint
or 20%
in order to be-attractive of building and loan associations?
I think it would be extremely
to persons with moderate wealth.
And
few promotions hold: any healthy, if two or three or even
such promise.
Furthermore ... a dozen building and loan asso¬
the more able a man is because of ciations could combine and erect
-before.
was
<
as
in
con¬
mortgages
large housing project—own that
project, and operate it.
71 will
admit that legislation
a
will
so
probably have to be passed
that you can do this, but surely
position is
your
that
not
eco¬
that many of
have.
Therefore, I would like to pre¬
different from
no
without pride
of posterity.
size)
panies and savings banks.
;
The redevelopment law of this
State makes many things
that
were
from
the
possible
So
not possible before.
viewpoint of
a
I would like to offer this
realtor,
thought
of ancestry
hope
or
7'.77
•:
Frank Douglas Now Is
Associated Willi Dunne
Frank J,
Douglas
announces
the
continuance of his mortgage1 cer¬
tificate
and
business
mortgage
through Dunne & Co., 25 Broad
Street, New York City.
> 7.;,
(except in the matter of
of large
insurance com¬
t
suer
investing
struction of new homes.
was the cess, to undertake the venture."
time the offer was made and were
National.
Consequently, we are all con¬
given an opportunity to rescind. Forum Committee of the American
fronted
with
a
serious
factor
The security holders who later
Institute of ^Banking which is a
which militates against the con¬
tendered
their
securities
were
division of th^ American Bankers
struction of new housing, because
likewise informed and given an
Association,^—While serving as
housing to date has involved not
opportunity to withdraw.
^ Chairman of
jjhe National Forum only risk, but considerable man¬
Some of the cases I have dis¬ Committee he established eighteen
agement and economic foresight
cussed
involved,
among
other Bankers' Forums in leading cities
as well.
77,V";%7-7;.77'things, the failure of an issuer to throughout -th(2 United States. -: ;'
While I shall not predict what
disclose that it w»s repurchasing
Mr. Brennen comes of a family
the quantity of new homes to be
its
securities.
We
have
been steeped in Banking and finance,.
produced annually in the United
asked many times whether such His grandfather, James Rod well;
States after the war will be, nev¬
failure is of itself a, violation of was President of the Manufac¬
ertheless it Could be greater if we
the rule.r Experience in such sit¬ turers National Bank of Brooklyn
would all, including those of you
uations has shown that non-dis¬ before that institution was merged
closure of the identity of the is¬
in
capital, plans for the
ture of the nation has had serious
ment funds—which may
best
in
sent this
,
"
r
to .you.
cern
—
material fact
a
almost, if not
completely, ineffective. While we
have had the underlying capital,
we
have, nevertheless, in recent
years lacked venture capital—and
that is, of necessity, of great con¬
.
higher market price at the time
is
other
•
'they toil- not neither .do they
spin'—'would~'«*lie awake nights
endeavoring'/to
conceive some
offer
the
■
plied representation that such of¬
fering price is at least equal to
the current market price, the fail¬
the
render
.
se¬
disclose the existence of
Development
type of building which
be
erected; research into
of locality for
homes; research as to what in¬
come
group and on what price,
house you want to
lend, keeping
the
(Continued from page 2808)
.
'J.
to
should
Real Estate
.
curities involved, contains an im¬
ure
Capital and
,;cv
^-77' ■(;}
who are in the lowest brackets.
Although
in
several of the
7 But we must ask at this point,
above cases'-the Commission took
where do people place their in¬
no action 'whe% rescission was ex¬
vestment funds?'
The man who
tended shareholders by the vio¬
has
an
income of five or ten
lators of the tule, the need for
thousand ., dollars
a
year—after
more drastic action to protect the
taxes—Is not essentially a venture
unwary and -ignorant. investor is
investor; he places his money in
more and more apparent.
And in
lifer insurance,, or savings banks,
this connection, because of - the
in building and loan associations,
constant increase in the number
or in government bonds; he can¬
of cases, Hae: Commission will be
not afford the risk of, equity in¬
resorting to "the remedies it has
vestment. 777/ •:.:: '■* ■'77, >/ ''f:P .■77:';; ■ 7at
its
disposal,
the injunctive
7 Oh the other hand, we are de¬
process,/ broker-dealer
proceed-,
creasing the; number of those who
ings and finally, criminal prose¬
ha ve high incomes. Thee net result
cution.
"^r,
v;;;;7; ■ ;.7777
is that not only is there less ven¬
t wish tb-'tflose with, this state¬
ture capital than existed some 15
ment ■ of ajuftst: :
; 7-777;; or 20
years ago, but the risk of
-"We do not^deem it advisable investment
what witfi excess
to day down ^ny hard and fast
profit taxes and what have you—
•
v;7 In such situations, shareholders
are
generally unaware; of the
higher market price.
Since an
Venture
imperative! for them,,:, to be
widely
disseminated;*t In that,
corporation
at
kind and
is
at¬
your
involved
the
2827
Interesting Utilities
Hills
Black
common,
and
Power
&
Light
Utilities
Missouri
offer interesting situa¬
tions at current levels according
to memoranda on these situations
common
prepared by G. A. Saxton & Co.,
gentlemen, without preju¬ Inc., 70 Pine Street, New York
even without charge!
City. Copies of these memoranda
I have read with a great deal of
may be had from the firm upon
interest the report of your post¬
request.
war
planning committee. If the
cover
is eliminated, it is some
Attractive Power Issue
eight pages in size. Having been
to you
dice—and
.
the
chairman
of
a
similar
com¬
.ri
....
-Tl
■
Common stock of the Arkansas
mittee of the New York State As¬
Missouri
sociation
tractive
of
Real
Estate
Boards,
I would like to
brag a little and
say. that our report, in fine print,
is 38 pages in size!
To
be
serious again for a mo¬
ment, though, I notice that you
have
planks providing for the
promotion of savings, the promo¬
tion
of
mortgage lending, and
mortgage servicing.
As a rank
outsider—and I guess you will be
glad to get rid of me when I am
through
in a few moments—I
would like to suggest a plank to
you which might be labeled the
"promotion of research." Research
into
post-war construction; the
i
Power
Co offers
situation
an
at¬
according to
a
Cobu
&
Torrey, 1 Wall Street, New
York City, members of the New
York Stock Exchange.
Copies of
memorandum
this
prepared by
memorandum
may
from Cohu & Torrey upon
be had
request.
Attractive Rail
Boston
fers
an
&
Albany Railroad
interesting
of¬
situation ac¬
cording to a circular nreoared by
Adams & Peck, 63 Wall Street,
New York City.
Copies of this
circular
may
be
firm upon request.
had
the
from
-
*
THE COMMERCIAL & FINANCIAL CHRONICLE
2828-
tion
the better it'can
develop its be beneficial for all of Europe
protect its borders. and the rest of mankind.
A v.,.';
.But even that is not always, true! h' Apparently there would seem
The question might well be raised to be no real intention at present
and
resources
•
-
.
.
.
other
and
affecting
Federation
Labor
of
plan for postwar security, repre¬
sentatives of the United Nations
iri Washington
met
have
More
the
of
formulation
the
Since
'
•
will have sole,
Powers
a
the
at
Dumbarton Oaks estate and have
Great
than
that,
has proposed the
provision that each
bers, that is, each of the four or
shall have the
to
its
shall
vote
own
amend
be
sufficient
complaint against
it by another member of the com¬
tional armed conflict.
V
munity of nations.
In practice
The
American
Federation of
■such a provision would mean that
Labor
Committee' on ^Interna¬ each of
the Great Powers would
any
applaud every honest attempt
community of nations
to create a
having for its aim the outlawing
of war and aggression and the
establishment "of the rule of law
We
affairs.
international
in
are
pleased that the Dumbarton Oaks
proposals included a plan for the
setting up of a Security Council
which is to have at its disposal
all
necessary
means—including
armed forces—for the prevention
aggression and for the main¬
tenance of world peace.
All this
is in direct line with the Federa¬
of
tion's
proposals
postwar
made
during our April forum, and it is
not the first time that govern¬
ments have
looked
to
organized
plans in na¬
tional and international affairs.
labor
for
workable
nations will
many
omissions, failures
and
shortcomings of the draft in its
existing form.
President Roose¬
velt 'has wisely said the publica¬
tion of the draft was made so as
"to
permit full" discussion by the
people of this country prior to
the
of a wider con¬
this all-important sub¬
convening
ference
on
ject"
?7;.
;
Wpile heartily endorsing the
principles of the Dumbarton Oaks
proposals, the American Federa-'
tion of Labor,
at its recent con¬
politics and their policy of
dividing the world into spheres
S,C
ruined
in
and
bloody
completely
a
battlegrouhd:
-
power
unnecessary,
armed
-
„
The only accept¬
international
ways,
never
dare to attack
.
a
Great Power, nor involve them¬
with a small nation allied
.
unilateral agreement with' a
\
Power,
these
proposals
would leave the small nations en¬
by
Great
*
tirely at the mercy of any or all
.
of the
Big Four or Five.
This
is
which
there is
no
the
for
of law"
Moscow
proposal
equality of protection
"rule
pledged in
not. the
was,
In
this
and
the
Teheran.
and
large
rather there would be
tion
at
smaller nations.
of
aim
able
an
or
,
protec¬
weaker and
the
for
all
small,
no
steamboats, airlines,
the
telegraph and the telephone, the
progress of modern schooling, the
evolution and rise of bookprinting
and
newspapers — all
these
is, in
my
opinion, to provide pro¬
tection and security for all mem¬
of the
is
It
could
organization.
that
true
strengthen
-
But
history7 that millions of common
people could share in the fruits
of political democracy and cul¬
tural life, have lead, in Europe as
well as in Asia, not to the forma¬
Power
Great
Greece, with seven million in¬
habitants, more justifiable that
the; sovereignty of Poland, with
position
military resources.
certain
a
vetoed the
and
sible for the first time in; human
by forming large regional federa¬
tions and pooling their economic,
strategic, and
garia
than
nations
small
their
the holders of this
achievements which made it pos¬
or¬
ganization of states, the only aim
which would justify its existence,
has
tion of
formation of such re¬
one
culture
gional units,' Thus the small na¬
tions will enter the-General Inter*
uniform and universal
and
new philosophy
independent and sove¬
reign existence of Roumania, with
the
her 18 million and her vast terri¬
Is
tory?
and
of
strong
•/.">/'7T,
speaking of Belgium, Po¬
army?.
a
y-V
While
land and
Greece, let
attention
the
to
call your
me
strange
"realists"
called
,■
in the views
language, but to the dictions
development .of a multitude of
languages,
cultures
and states.
This historical reality cannot be
sovereignty
million
30
over
the
contra¬
of the
who
so-
advocate
and Roumania; in Poland
Hungary?
The fact is that
Russia
is forming in
Poland a;
government of her; own, .without-,
regard for the wishes of the
majority of the population andfor the legal Polish government:
in London. In Bulgaria a bloody,
any
was conducted by the oc¬
cupying Red Army, a purge com-,
pared with which Greek blood-;
shed seems small, and Russia in-;
stalled there a government of her;
own choice.
But not a, single lib-,
era! ; realist
protested' against'
purge
.
'
'
power politics and preach the new Russia.
'.
Organization as atomized
religion of helping they strong i
I hold no brief for the British'
small particles without real force,
without legal protection against changed or be reversed. The prob¬ against the weak.
Empire or for British imperial,
Our. liberaL "realists": are vior policies-. ' Yet, it cannot be denied the arbitrary action • of any Big lem is how to bring about more i
Powef or even of a Small Power
unity and harmonyamong the lently attacking Great Britain for that Communist, policy in the.
which has a mighty protector in variety* of nations and states in her policy; in Greece and Bel¬ liberated countries has been dl-Europe and Asia. •.
:>
/•;
gium. It is contrary to the prin¬ visiv.e, provocative and dangerous,
the Security Council. ;r '
It must be admitted that this is ciples of international democracy, to the cause of the United Na¬
What moral and practical au¬
a very difficult problem.
The na¬ they claim, .to intervene, in .the tions. It is not difficult to agree;
thority would such an interna¬
tionalist evolution .is a double- internal
policies
of
liberated with Winston Churchill when he,
tional
organization
command?
countries/ However, these same says that "the last thing that re-,
'7 J
?
Labor could never accept or en¬ edged phenomenon.liberals, have
never
uttered
a
sembles
democracy - is mob, law:
As it often turns out in history,
dorse siich a caricature of a new !
word in opposition to the inter¬ with bands of gangsters, armed
community iof nations.
Protec¬ a really progressive process may
vention of Russia in the internal with
deadly \veapons,
forcing
tion of the weak, especially pro¬ at a certain state become more of
affairs of Poland, Roumania, Bul¬ their way into G^eek cities, en¬
tection, o£( the national rights, of a liability than an asset. The co¬
small nations, has been the tradi¬ existence On the small continent garia. More than that, every word deavoring/to introduce a totali¬
of criticism'on Russia issued by tarian regime.":
v.
; "
tional
policy of American and of Europe of about 25 absolutely
If we analyse more closely these
anyone,
even by labor leaders,
world labor since the very begin¬ independent and sovereign states
national
-
.
,
-
,
,
vention, held in New Orleans, ap¬
proved the Committee's comments
on Chapter IX, to the effect that
this proposal ''which arranges in¬
ternational Economics and Social
Cooperation is couched in vague
political terms that 7imply the
designation of persons of political
experience to this agency and
which must deal with industrial
and labor matters requiring spe¬
cialized
tence.*'
experience
and
compe¬
The convention approved
the suggestion, if not demand, that
the I.L. O. become an integral part
of any new
;
plan to deal with
so-
cial and economic matters.
Then,
too,
the
convention
agreed with the thought that the
international
organization
pro¬
should
posed
be
universal
in
-
,
,
ning of the labor movement. Shall
we
now
revise our
democratic
and
freedom
order
loving traditions in
obtain
to
the
ques¬
very
tionable
guarantee of the Secur¬
ity Council, with its selfish dom-*
ination
by the
Great Powers?
Shall we trade the principles of
national liberty, of the selfrdetermination of all peoples, and
Atlantic
the
for
Charter
the
realism of the Dum¬
agreements in the
proposed by one
of the
imaginary
barton
form
Oaks
.character and all-inclusive, that Great Powers?
: its
assembly
should be
given*
greater and more important func¬
tions^ and that the. Security CounVcii
at present
projected is in¬
equitable in its principal charac¬
teristic and most striking feature
of organization to be created.
as
It is
fair to
that the
have
the
greater
for main¬
taining peace and of punishing
aggressors
should .have, greater
influence in a Security Council,
charged
with these obligations
and
responsibilities.
But
the
powers
only
say
i. which
will
responsibility
.
Dumbarton Oaks Conference pro¬
There
to
are
reverse
those who would like
the
traditional
of democratic labor
lem-of
labor
small
has
on
nations.
sponsored
views
the
prob¬
Organized
small 4
na¬
tions in the past, had tried to pro¬
tect them from enslavement by
big
empires,
and
even
helped
with
and,
divergent
more
often
Democracts,
is
re¬
garded as a major crime and the
culprit is systematically smeared
and labelled as a pro-fascist and
has
pro-Nazi.
gradually become a very real
to the peace of Europe
In
danger
and
of
the
progressive
features
of
How
world.
and
thb
modern
the
can
"dangerous
nationalistic
ers
Why this difference?
who in most instances
are
avowed
Communists, have refused to lay
their
unless their po¬
development in the Old World be
down
litical
Organized Labor has always
sponsored the democratic solution
of this problem. The British Labor
Party, in its 1940 program,^made
constructive proposals to this..ef¬
fect. The creation of a European
gium this has led to street fight¬
ing between the government and
kind of United
States of Europe, would certainly
be another way out. Such a fed¬
eration would represent a concen¬
tration of economic, strategic and
Federation,
social
a
yond
resources
which would,
be-;
any
arms
demands
met.
are
Communist-led
the
Our
tors.
liberal
,
In Bel¬
demonstra¬
"realists"
are
loud in their demands for national
unity, as long * as their political
demands are granted and as long
as unity is consistent with'the in¬
ternational policies of the Rus¬
sian
soon
government., (However,
as'Soviet power politics
as
are
involved, national unity is cyni¬
discarded,
cally
.no
else is involved.
In
matter what
5 .'**"7%'.
Belgium, which is a hub for
communications
Allied
and
sup¬
plies for our armies now fighting
on
German
ruption
trous
soil, Communist dis¬
well have a disas¬
may
effect
on
our
fortunes
contradictions in the
of
new
theories,
underlying political
find
will
we
which explain the inner
inconsistencies of these trends ap-;
motives
parently
Belgium and Greece, lead¬
of the resistance movement,
reconciled?
doubt, enable the Euro¬
big multi-national empires of the pean continent to reach - a much
Hapsburgs, the Turks, the Rus¬ higher degree pf welfare and of
sian Czars. Now we are told that political, economic and social se¬
all this was part of the democra¬ curity than Europe now possesses;
tic concepts of the eighteenth and At the same time, every European
nineteenth
centuries,' and
that state, from the smallest to the
those concepts are now out of largest, would enjoy in this fed¬
date. It is said the time of small eration an equal degree of free¬
free- democractic nations is gone. dom, and of cultural and national
In the forties of the twentieth independence.
,
f
century there is no room for
There is nothing in the existing
them to free themselves from the
Socialists,: or
not, contradicting interests,
rivalries,
economic ' competition,
permanent border conflicts, etc.,
than
so
realistic and objective.
Whether
one. agrees
with the
formulation of Churchill's
exact
strictures against
a
the Communists
not, it is apparent that there is
or
inter-Allied
vast
going
in Europe,
on
struggle
the statesmen have fallen out
the
now;
It seems that;
over-
spoils—and the tragic aspect,
of it is that victory is by no means
fully in
A
our
few
hands.
days ago, Ernest Bevin,
British Minister of Labor, told his
Labor Party colleagues that Brit¬
ish
in
action
taken
with
had
Greece
been
the
knowledge and
approval of Russia and the United
States.
Russia, according to Mr.
Bevin, had undertaken the main
task of restoring law and order in
Roumania
sumed
When
a
and
Britain
similar
task
in
had
as-;
Greece."
the
plan for dealing with\
Greece was agreed upon by the;
British Cabinet, it. was taken to
Quebec,
den
and submitted to PresiRoosevelt,; who agreed to it
war.
Belgian
Communists',' )!jm and initialed it. '; •
posal go much further. The draft
their desire to maintain a private
constitution of the new interna¬
Needless" to say, the turmoil and
tional organization
army to be used against legally
makes
the
civil war nowgoing on in the lib-constituted Belgian government, erated countries has alarmed the.
General
Assembly,
the
only
agenCy in which the smaller na¬ small nations. We are told: only conditions in Europe which would are prepared to plunge that coun¬ American people—and with ampletions
are
fully
represented,
a
.;
big economic and military con¬ make it impossible for the indivi¬ try into civil war.
justification.
American workers?
mere, advisory body, deprived of
centrations Can survive; the small dual states to form such a federa¬
It is the same in Greece.-THere, who are making-sacrifices every;
any real importance or influence.
states are doomed/ and there is tion. Only selfish and imperialis¬ after nearly four years of all the day on the home front, whose sons %
The, real
center
of gravity
is therefore no sense, in protecting tic interests can or will prevent horrors of German occupation— are dying, overseas in Europe and.
transferred from the general com¬ them against, the Great Powers.
Epropean countries from taking hungar, privation, disease, mass in the Pacific;-are beginning- to,
There is some truth in the ob¬ a course in that direction which, executions—"o sooner **>ere the wonder whether the victory for munity of all nations to a small
servation that the bigger a na¬ in my opinion- is one'-which would Germans
driven out
than - the which we are paying in blood and"body, of which four or five Great
.
—all
selves
bers
However, endorsement of the
leading Dumbarton Oaks propo¬
sals by the American Federation
of Labor does not necessarily ab¬
solve us of the responsibility of
making justified criticism of the
traditional
•
E L A
gols, the Turks and the Hapsburgs the open annexation of the Baltic most sanguine outbreaks on the
of them, after a period of States by Soviet Russia, the trans¬
Italian peninsula.
>
What
should
occupation
au¬
flourishing, fell to pieces and out formation of Poland, Roumania,
of their debris new, smaller and Bulgaria,
Yugoslavia
and
thorities who are responsible for;
per¬
nationally
more
homogeneous haps also of Hungary and Austria keeping order do in such cases?;states arose. Seen from this angle into satellites of Russia as a pro¬ Just capitulate before the coup
it can be said that the history of gressive process.
The very same d'etat.
And
perhaps in a few
Europe is- the history of the rise people are violently opposed fc weeks before a second uprising?
of national states.
This develop¬ any intervention by Great Britain Can an occupationary army con-,
in the affairs of Western Euroe, fine itself to
ment undoubtedly was a progres¬
passive registration
sive one.
In any case, that was as in Greece, Belgium, Holland, of armed revolts and surrender,
etc.
<■
the
the
way i Europe
achieved
its
occupied
territory
to.; the
miraculous cultural and spiritual
May I ask why this difference, group which has at the moment
is the independent and sovereign more mortars and 75-millimeter,
contributions to the
progress of
existence;of Belgium with
mankind.
her guns than the other group?
//'
The advance of modern indus¬ eight million souls and her micro¬
If that be
a
real democratic^
try and trade,--the development scopic army any more justifiable policy, why does not Soviet Rus¬
of modern communication, rail¬ under the general viewpoint of sia take the same course in Bui-;
.
We
their
renounce
dominated
>
of-which I have
be free to engage in aggression
the honor to be Qiairman, whole-:
whenever it: felt itself strong
heartedly endorsed the principles
enough to risk conflict. As small
Oaks proposals.
to
,
tional Relations,
of the Dumbarton
of the Great Powers
among some
-
in its hands, attempted
to overthrow the legally installed'
government.
Athens is now a*
arms
.
five Great Powers,
organization having for its aim
prevention of future interna¬
the
we
Communist
iwith
-.
right to veto in cases were it may
be accused of aggression, and that
proposals for the estab¬
lishment of a general world-wide
was
Or shall
•
of the so-called permanent mem¬
drafted
large empire.
.
struggle between the left-,
wing EL AS and the British troops,
of influence.:p--' and the forces of the Greek loyal¬
than 130 millions?
'• •".
But is that a sufficient reason ists.;
:
:,7.
What have been the "objective for Organized Labor to abandon
In Italy, one
political crisis is
trends of history?
v
*
-' its democractic views and prin¬ followed by another. The shadiestl
One does not need to be an ciples?
Why should labor fallow sort of power politics is the order
historian to realize that the whole
imperialistic teachings and ' be¬ of the day. The Italian govern¬
history of the European continent, come an accessory to unilateral ment; dare not make public the,
terms < of
in marked difference from that violations of the rights of small
Italy's • surrender, 'for
fear of provoking civil war. Theof the New World, was the his¬ peoples?
; '; ;
■
Then there is another remark¬
tory of perpetual birth and down¬
peopte of Italy,are starving; there;
fall of great empires/ The Roman able feature of this new philoso¬ have been hunger riots in Rome,
a
drastic
'Empire'of the Caesars, the Em¬ phy.r The prophets of this neo- and unless there" is
pire of Charlemagne, the Spanish imperialism accept without mur¬ change in policy on the part <ot
mur and even with lively aproval
Empire, the Empire of the Mon¬
the; AMG, we may witness the,
Powers
unbelievable
very
admit .that the rank of a Great
Power can be attributed only to
nations with populations of more
the
of
one
•
to whether France in 1940
as
exclusive
and absolute control.
world peace.
American
"" /
(Continued fr Dm page 2806).
problems
Thursday, December 28, 1944'
..
-
,
.Volume
-treasure
■
is
not
diplomatic
still
Number 4346
160
being lost
front.
is
that
before
even
this
being sown
in
Italy,
'France, Belgium and Poland and
one
are
in Greece.
It
all sides that
on
outstanding result of the
that
the
Big Three
proposals
Cynically,
Conference
Time
is
find
may
to.
action
the
as
A
,
running out.
drastic
we
to
'
is
And
un¬
taken,
soon
ourselves
;
partners
something; resembling
inter¬
■
last Presidential election
complete
was
the
renunciation
of isola¬
the American people.
'Spokesmen of both parties were
tionism by
in favor of
:
intelligent, far-sighted
international
cooperation.
But
national
the
chaos.
American
return
may
to
that
If
happens
people, .in despair,
isolationism once
Interstate
offers
Aircraft
&.
kng.
Co.
interesting situation
an
cording to
buted by
25 Broad
Hirsch, Lilienthal & Co.,
Street, New York City,
a
members of the New York Stock
from the firm upon
request.
/
decades
other
of
almost
armament,
and
unbearable
Ultimately-
an¬
&
Knowles
offers
common
OF THE
CITY OF
;
NEW YORK
;
capital
The transfer books will
:v
;
not
/
of/this dividend.
A A>/:/> AA -A;
.//
'/A:A; w
;■.
\
•
..
; THE CHASE NATIONAL BANK
Ar.
Loom
,
be closed in connection with the
A
attractive
possibilities, according to
BANK
The Chase National Bank of the City of New York has declared
dividend o(70i per share on the 7,400,000 shares of the
,
f
•
OF .THE CITY OF
,;A';':';/- A'A/V /". A'>;A-:A A
NEW: YORK
w. H. Moorhead
/ .,>
"
1
•
Vice President and Cashier
■
memo¬
;
r The American
people appear to
be perfectly willing to support
tion.
Whether the American peo¬
randa issued by Buckley Brothers
1529 Walnut St.,
Philadelphia, Pa.
ple will continue to have faith in
members of the New York Stock
reasonable,
Exchange and other national exchanges.'Copies of these memo-i
;
-
■
posals, consistent with the prin¬
ciples
But
of
Cliarter.
the " Atlantic
they will recoil, I
certain,
am
from any participation in a strug¬
gle for naked power by one group
of nations led by the British Em¬
pire and other group of pations
.headed by the Russian.Empire.
..'A; Every American will readily
honor England and the English
people for their heroic, singlehanded stand against the Nazis in
1940.
We will never forget that
while
Americans
we
were
debat¬
ing the question of isolationism;
-and while Russia was allied with
Germany, the British people were
enduring the terrors of the 1940
blitz.
But no matter how great
admiration may be
for Eng¬
land, it must be said with utter
our
candor that
have not sent
we
our
fruitless
Crompton
Works
NATIONAL
/
payment
Attractive Possibilities
to
would
CHASE
stock of the. Bank, payable February'1, 1945, to holders of record
at the close of business
January 11, 1945.
-
and other exchanges;;
Copies of this circular may be had
most of the Dumbarton Oaks pro¬
•
v
Exchange
that would, I am in¬
believe, be ruinous.
It
mean decades of suspicion,
clined
danger of fading. ;
i
THE
beini,distri¬
circular
a
ac¬
more—and
now, it appears that our fine glow
of internationalism is .in serious
-
DIVIDEND NOTICES
Appears Attractive
Washington
the
is referred
Dumbarton hoax.
2829
Interstate Aircraft & Eng.
j
real faith in the
no
recently agreed Uponpn Washing¬
less
,.
agreed
was
the most
indicate
have
ton.
is over,.the seeds of the next
•.war
all
the
on
what
there is the growing
worse,
suspicion
And
THE COMMERCIAL & FINANCIAL CHRONICLE
world
conflagra¬
cooperative interna¬
tional action, or whether they will
return
in
desperation to isola¬
tionism—this time, a well-armed
isolationism —depends
speedily
the
United
cooperation has re¬
ceived duripg the past few weeks,
it is still my firm belief that unity
posals cannot be divorced from
the problem of a democratic peace
on the basis of the Atlantic Char¬
The paragraphs of this char¬
ter.
offers
Stoker
attractive
Otis
bilities
Co.
possi¬
Terminal
&
still be sal-i -in a memorandum on this ^situ¬
If this is to be accdmplish- ation.
Copies of the memoran¬
ed, there must be an end to cyni¬ dum discussing1 the. issue in" de¬
cal power politics and to secret tail may be had from Otis & Co.
..
The Am¬
maneuvers.
upon
sacrifices
in
blood,
money, must be treated
as
adults]
worthy of confidence.
Of course,
do not expect military infor¬
mation to be divulged;
but we
we
have
right to
every
know when
should be amended in such
a
\ '—
; // ' this Company by check on Jan. 15,
/ 1945, to shareholders of record at the
:
;;
close" of
V
business
on
The Transfer Books
.
E. J.
San
rights of
Board
of
Dec.
will
29,
not
•instrument for
the domination
Stock
of
American
Casualty
Company affords possibilities for
remunerative
ing to
investment
accord¬
memorandum discussing
a
this situation in
detail, issued by
Huff, Geyer & Hecht, 67 Wall St.,
New York City. ;• Copies of this
interesting and informative memn
orandum
available to dealers
are
request
upon
Hecht.
•
to
/.
v
Huff, Geyer
&
A/'"
A "VA.:
:
Speculative Possibilities
-
Common
stock of
Illinois Cen¬
tral Railroad Co. offers unusually
liberated countries.
Con4
sistent with the pledges contained attractive speculative possibilities,
in the Atlantic
Charter, the new according to a study of the situa¬
international organization should tion prepared by H. Hentz & Co.,
Hanover Square,
be general in
vision
the
of
world
into
spheres
/in influence with all the inevitable
and
tragic
•which
consequences
An
course.
of
undemocratic
present
that
peace
the principles
of justice and liberty for all na¬
tions would be a very dangerous
disregarded
the
projected
'.-proposals,
Security
the
at
most
While
five
Great
greater
in the formulation of its
vote in
we
felt that
our
safety, our lives
threatened
his allies. The
and our property were
by
Hitler
and
world could
never
have been safe
from
aggression and the constant
to freedom and decency
as
long as Nazi and Japanese
power was unbroken.
We shall
not recall our boys while that task
danger
.remains unfinished.
However, it
is time that the American
people,
decisions,
this, however, should not exempt
at the front.
because
propor¬
tionate share in the leadership of
the new world organization and
any one of these powers
war
Powers.
a
four or five Great Powers
the equal rule of law.
It
is
cused
from
hardly equitable to allow
to cast
instance where it is
an
a
ac¬
of
aggression.
It is even
more inequitable to allow its soli¬
tary vote "to nullify any complaint
proposals
to have any reality,
necessary for the rule of
is
it
are
Unanimity
to
be
replaced by a
two-thirds majority of the
perma¬
nent
members of the Council.
There
larly
other
are
in
the
flaws, particu¬
absence
constructive
of
definite
proposals which
vital if
we
land and
world.
There is
are
to be ruled by law
and not be force in the
post-war
are
Russia/precisely how we
stand on the question of imperial¬
ism and the old-world power pol¬
of the
itics.
ment which
-voices
who
are
now
declare
certain
heard in
that
pessimistic
our
country
the Dumbarton
Oaks
proposals have been tor¬
pedoed by inter-Allied disunity
in the liberated countries.
They
point to the secret understand¬
ings, such as was revealed the
'other day by Ernest 'Bevin. They
comment on the de Gaulle-Stalin
pact which
seems
to by-pass Dum¬
barton Oaks. I They say
that civil
'war in Greece and. Belgium, and
Soviet unilateral action in Poland,
no
mention in the
existing proposals for a lessening
staggering burden of arma¬
now
crushes human¬
ity.' There are no provisions
cerning dependent peoples,
colonies of the
con¬
the
Axis countries, and
other backward areas, which will
not be capable of self-government
for
time
some
method
of
to
come.
international
Some
trdstee-
ship should be established for this
purpose.
\
•
...
Bantam
Coca-Cola
Car
December
will
depend
create
an
tion. such
from
the
peace
of the world
whether we can
international organiza¬
as
on
the world
Dumbarton
hopes forOaks
pro-
1944 to Stockholders
19,
1914
until
January
2.
■
.i
,;
/
;•■■
ROBERT B. BROWN, Treasurer.
and
Pan¬
THE SUPERHEATER COMPANY
1944.
be closed.
/--
Dividend No. 158
Beckett, Treasurer
A
quarterly
(25c)
of
the
-
dividend
share
per
Company
of
all
on
has
;
twenty-five
the
cents
outstanding stock
been*
Tomorrow's Markets
Walter Whyte
Savs—•
the
declared
payable
close".of business
/
.'
'
be
A
January 5,
M.
/
..
Treasurer."
shrugged off by false
timism.
at
'
\
1945,-
SCHILLER,
op¬
A,
.
(Continued from page 2806)
this obstacle is negotiated,
!
o*
■
■
Funneling all this into cur¬
optimism rides free.
Such
rent
stock
market
action
optimism Vis
nurtured
by. means that the
stops you have
hopes and fears and and is been
told are important
may
often so ephemeral that the
gain new importance before
first
rying for
The
such
its
a
one
send it
,
;
scur¬
!•//;:
or
..V
.
the next issue of this column
appears., It isn't necessary to
good thing about repeat the stocks or
thei^ crit¬
reaction is that it
course
points
can
cover.
either'within
within
runs
a
few
few days,
a
ical levels.' If you don ;V re¬
member them you can
to last week's column.
There is the
if this
military developments. This,
A
possibility |Jiat
market
doesn't, [react
within the next few
chances
refer
,
days,, the
that another
are
rally
place. But the prob¬
will take
abilities at this time favor
a
reaction first, then a rally* / V
A; More next
Thursday./» .
^!A:
|
[The
article
v-Walter A^hyte
views
do
expressed
in,
this
;
not
necessarily at any
time coincide with those
of the
Chronicle.
They are presented as
those of the author only.)
'iSih
from the firm upon
request.
comes as a real
surprise. The
public, on the other hand,
posals. Men and women in every
always has its nose buried
country of the world pray that
this may soon come to
deeply in the broad tape or
pass.
•
Mankind is weary of war. Men the daily pages of newspa¬
are
dying, women suffer patiently pers. And whatever the newsand in
silence; in the hope that trend is the direction the
pub¬
their children and their
children's lic
is likely to take.
children will be spared the
LAMBORN & CO*
WALL
99
war.
-
•
It is true that the
way to peace
at present lies
through Berlin and
Tokio; it is also true that the
American people are determined
to
fight on until victory.
But
there must be
peace—world-wide
peace—once this war is over. Our
returning soldiers and sailors,
workers
and
all
our
right-thinking
people will demand it.
The American people will
ly
Right
now the war news is
The current German of¬
bad.
fensive appears to have been
dulled. But as we are at least
as
know
that
the
have advanced
miles and the
some
-
*"
-
- ■
A-'
VL .A
'
\
t
Exports—Imports—Futures
/iJ;.
J i
?■'
DIgby 4-2727
30
but they, will
age-old game
Rail Yields
Paine, Webber, Jackson & Cur¬
tis, 25 Broad Street, New York
Established
1856
H. Hentz & Co.
J'
Members
,.
.
politics.
dark indeed.
Av'
glad¬
any
organization which
its honest aim the
preven¬
power
<
damage cannot
Gity, members of the New York
They will not
Stock Exchange, and other lead¬
support one imperial power in its
ing national exchanges,- have pre¬
designs against other nations.
pared an interesting table of sev¬
The Dumbarton Oaks
proposals, eral preferred rail stocks
yielding
together
with
the
suggested from 6%% to 10%.
Copies of
amendments, offer a hope to. m
this tabulation, additional inforT
world
which, is
in
danger of
bleeding to death. If these pro¬ mation on the steel industry and
posals fail, and if no effective a brief discussion of the market
public opinion is aroused against
now, all contained in the same
the civil strife now
going on in
release,- may be had from Paine,
the liberated "European
countries,
then the future for world
peace is Webber, Jackson & Curtis upon
of
SUGAR
-
Ger¬
do
mans
join
has
tion of future
wars;
not be parties to the
j
b.
sure.
We
/
!: 'i
48 hours behind .the news we
really don't know for
STREET
NEW YORK 5, N. Y.
agony
of still another world
New
York
Stock
New
York
Curb
York
New
Commodity
Chi
New
c
a~g 0.
Cotton
N. Y,
•'
Exchange/'
•
Exchange/ uv.
Exchange,"
Board. of
Orleans. Cotton
And other
"
i:
Exchange
Inc.
Tra,<ie
y
Exchange.,.{
' •"
,
Exchanges
Cotton Exchange BJdgl
.
-—-
■
:
according to circulars nomenon.
Tide professional
issued by Hoit, Rose &
Troster, 74
trader seldom pays attention
Trinity Place, N. Y. City. Copies
of
these circulars may be had to
current
news,
unless it
.
The future
of
the
American
declared the regu$1.25 per ,share on
of
•
'attractive too, is strictly a public
phe¬
offer
situations
against it. If the Dumbarton Oaks
through the power of public opin¬
ion, made it known, to both Eng¬
There
American
ama
or
responsibility
should be matched with
peace, a breathing spell for the
preparation of new conflicts, rath¬
er than the lasting and democratic
peace
for which our sons and
brothers are fighting and dying
America is in this
Council
grants excessive power to four
Directors
Botn payable December 31,
1945.
Francisco, California
clouds
in the
of
u-
company has
d.viQend
,
/the Great Powers and for the di¬
u.
the Preferred Stock and a dividerid
of $1.50 per
share on the Common Stock of the
Company.
business
depending on what factors
scope,^unlimited by
NewjYork City, obtain at
the time.
A
nations and the freedom of na¬ the present formula/ that, "mem¬ members of the New York Stock
tional'
self-determination
are
bership should be open - to all Exchange and other leading na¬
tional exchanges.
: closely tied
Copies; of this / The
We of the
up with our general peace-loving states."
important factor at tms
approach to the problem of de¬ American Federation of Labor feel study may be had from the firm
time is news. The war is now
upon request.
that to exclude
A
mocracy.
A " 'A."
permanently any
v..': "A '
the biggest breeder of
poten¬
/ A new international organiza¬ state is to endanger the new order.
If we are to have peace in the fu¬
a
tion
Attractive Situations V| tial news., And my hunch is
hpse<ji on thf principle of un¬
that from now on the market
equal- protection for the member ture, all states will have to abstain
Common and
6%
from war and be peace-loving.
cumulative
states would inevitably become an
will pay more attention to the
•j
convertible
preferred
of
the
Under
the A
ter which deal with the
COMPANY
Streets
of Record at the close of
business December 19,
1944.
Tne stock record books will.be closed for
the purpose of transfer of
stock at the close of
2% of its par value, Will be paid
upon the Common Capital Stock of'
way
provide international ma¬
chinery to prevent precisely the
sort of thing that is now going on
West
a.
quarterly
1—" V
Attractive Ins.: Situation
to
as
The
ja_*
to
•
-""A'-;' A: Aw
";
'mmttKtgjnmim»
and
^
January 15, 1945 to stockholders of record
and
toil
.
request.
erican people, who daily are mak¬
ing
"
of Directors on Dec. 13, 1944, for the
fourth quarter of the year 1944, equal
common
post-war
for world peace may
diplomatic
DIVIDEND NOTICE
A cash dividend declared by. the Board
Co.,
Cleveland, Ohio /declares
Tower,
vaged.
-
tions in the Dumbarton Oaks pro¬
Standard
Despite the setbacks which in¬
ternational
1
Manufacturing
V A
request.
Post-War Possibilities
solve their difficulties.
•
demands, nor the imperialist de¬
signs of any country in the world.
The problem of the small na¬
on
Common Stock Dividend ^o. 116
re¬
to
overseas
be had from Bucklej
may
MANUFACTURING
•Noble
how
on
Nations
fight for the American national power is being
; British
Empire. A However great pledged, without having to wait
may be our admiration for Rus- for it until the statesmen of other
-sia for its gallantry; it must be countries fall out, .as in the case
said with equal candor that we of the knowledge of Bevin
revela-f
/have not sent our boys overseas tion. .,t.' ■;//;.•
A;:/ 'A/AA -V:/ A
The Dumbarton Oaks proposals
to guarantee Russia's
territorial
,,boys
randa
Brothers
AMERICAN
-
PACIFIC GAS AND ELECTRIC CO.
request.
'
--
"
-
-
NEW
CHICAGO
YORK
DETROIT
GENEVA,
4,
N.
Y.; ^
PITTSBURGH
SWITZERLAND
'
THE COMMERCIAL & FINANCIAL CHRONICLE
28.30
IX.
Outlook for Business
on
substantial
a
is
scale;
no
in corporate
income
taxes,
except
possibly
some. reduction
in excess profits
taxes, and any relief in individual
income
taxes
will
probably be
likely
confined to the lowest brackets in
the latter part
tive in
of the year, effec¬
1946.■
Committee
Post-War
on
Taxation may recommend tax re¬
visions to aid
corporations during
reconversion
the
bill
relief
period.
A tax
contemplated with
is
Treasury backing which would al¬
low
corporations to cash next
instead of after the war
Government bonds
representing
year
the 10% post-war
refund of excess
profits taxes, of which $430 mil¬
lions had been issued up to the
middle of this December.
would
also
The bill
that "carry¬
back" refunds due
corporations
could be applied to reduce taxes
being paid currently.
IV.
provide
In view of the Government
con¬
need of additional war
loans, little
change is anticipated in
long-term interest rates during
no
the year.
If the
.
Federal
Reserve
25%.
We look for
volume of
an
increase in the
private capital fi¬
nancing, with corporations con¬
tinuing to improve their capital
new
structure
by substantial refund¬
oings at lower rates of return on
both bonds and
preferred stocks.
earnings are anticipated
to show a small increase, with the
foundation of the banks' large
holdings of Government bonds. A
Bank
number
of
banks
will
no
doubt
increase their capital in order to
bring their capital and surplus in
line with larger deposits.
Government bond
1945
in
In furtherance of such
/
increase and the unions
continue
to
their
"no-strike"
flotations in
war
bond drives of
1944,
and may be somewhat less, with
no change likely in interest rates.
Federal Re¬
a
peak
war
247
of
cline
of
German
hostilities.
should
be
accelerated,
185 and
200.
/
just issued
order freezing all
at
current
an
indefinitely, i.
German
e.
^
•-
Construction—Little increase is
appreciable results before the end
/
of durable goods programs.
The
ruling is expected tp have a sta¬
bilizing influence on manpower,
of 1945.
Industrials— Further
a
workers
broad analysis
that not many peacetime jobs will
look
for
become available while they con¬
tinue in war production, and it
from
on we
give
of the 1945 out¬
may
help transfer to critical
ament needs
released
of
more
by
cellation
arm¬
of the workers
completion
or
can¬
contracts.
war
WPB
"spot"
authorization,
however,
be allowed to increase in
which
areas
have
«
,
slowing up, caused by re¬
war developments, has little
no
bearing
activity and is
or
on
a
many lines of
factor in main¬
taining national income at
level.
Reconversion
a
high
will
be
greatly accelerated by Germany's
defeat.
A favorable factor of
maintained
as¬
be
hastening reconversion
stimulating production should
the combination
accumulation
of
or
increased.
even
The recent ICC ruling, while tem¬
sistance in
and
denying restoration of
increases,
left the matter
porarily
rate
the heavy
open
of
for
reconsideration
Utilities—Continuation
corpora¬
incomes,
more
borrowing will be necessary
press the war against Japan.
to
number
Agriculture
a
lower trend
quarters the belief is
some
hampering provisions.
in prices
agricultural
year
may
revise and amend
Liquidation
of
holding
continue,
with
approach
liquidating values. The majority
of holding companies are still sell¬
companies
will
market prices tending to
ing at sizable discounts from esti¬
mated underlying values.
ex¬
X.
pressed that Congress early next
Although demand will continue
high, increasing production may
cause
of
In
V.
and
The
recent
Surplus
Disposal Act appointing a threeman board
(of whom only two
have been selected) instead of a
single administrator contains a
Commodity Prices—Inflation
Market
the
law.
should
prices
remain
of
Farm
high
should
continue
Air
receipts
Banks
this
from farm marketings
year's level of approx¬
imately $20 billions.
VI.
|
1944
Above
Transport
Can
Mfg.
Dairy Products
Labor—Wages—
Electrical
Equip/
Railroads
•Railroad
•Gold
Paper
Printing & Pubg.
Equip.
Sugar
Wool
Same
as
1944
Drugs & Cosmetics'
Mail Order
Food Products
.Office
Glass
Oil
present, and accordingly will try
Baking & Milling
Brewery & Dist.
Building
to obtain all the concessions it
Cement
a
less advan¬
the
German
war
ends
than
at
can
in order to maintain "take-home"
Chemicals
possible to present
levels in the post-war period. A
conspicuous threat to "take-home"
pay,
?even
with present
rates
maintained, would be reduction
in the length of the work week
Coal
pay as near as
(Containers)
Glass (Flat)
Grocery Chains
House Furnishings
Household Appliances
Copper
Insurance
Cotton Textiles
Leather & Shoes
Department Stores
Equipment
Rayon
Rubber
Ships & Shipbldg.
Steel & Iron
•
•
tint^' for annual
wage,
and'
pay,
for a mini¬
for a shorter work¬
to
convert mainte¬
pre-war
Apparel
un¬
substantial
earnings and retirements have ad¬
vanced
considerably and
are
ex¬
pected to rise further, while lowgrade bonds owing to the high,
XVIII.
Preferred
Stock
Prices
High-grade preferred stocks
on
account of low money rates have
risen
practically
high
as
they
as
go, in numerous cases reach¬
or
exceeding their call
prices.
Medium-grade, liberalyield issues, while they have ad¬
even
vanced
substantially in 1944 in
flection
of
re¬
favorable
earnings,
have undoubted possibilities for
further rise, which is also true of
lesser-grade
issues,
especially
having substantial divi¬
those still
dend
accupiulations..
XIX.
'
:
Common Stock Prices
We feel unwilling
prediction
to hazard a
to how much higher
as
stock prices will go in
However, depending much
upon
the level at which prices
stand as the German phase of the
common
While Congress
another
for
tax
ment
ha^ "frozen" for
the present rate of
year
and
old-age
unemploy¬
is expected
to consider the broaden¬
insurance,
it
.
year
although when the-German
1945,
ends,
war
period
a
of
reaction
logical though it will almost
certainly be not severe enough to
seems
merit
being described as a bear
market—and may be relatively
unimportant and short-lived. After
this
expect
we
stock
prices,
to
see
common
the average,
on
ap¬
been.
war
ends exports should begin to show
scaled
expanded
an
post-war
and
loans
Britain,
credits
Russia
and
to
other
Finance Companies
Machine Tools
Machinery, Indus.
Meat Packing
are/likely to be
attempt $t world eco¬
nomic reconstruction.
shorter
and
hours,
higher
with
wages
sharp
a
increase in the number of strikes;
delay in attaining reconversion;
in Government orders
cut-backs
will
increased
cause
unemploy¬
ment.
International Conferences
XV.
Current problems of
Among
favorable
the
factors
Russia in
Polish border,
and Britain's relations with Italy
that may
and
the cost of living as measured by
sity
the
Powers.
will be slightly lower; no increase
in taxes is likely, and some re¬
the
Balkans,
the
Greece, emphasize the neces¬
of an early conference be¬
tween the heads of the three great
It may be presumed tiiat
definite
a
reached
ences
understanding will be
reconciling
in
many
differ¬
viewpoint.*5/"*/
international
notably
conferences
in
the,/ international
monetary fund to stabilize
curren¬
cies and the world
bank, proposed
Woods/ the interna¬
tional organization; to perpetuate
peace,
outlined
at
Dumbarton
Bretton
Oaks, and the international civil
aviation organization, discussed at
f/
some
seems
war
probable
profits
is
index
probably
in the excess
Germany's de¬
production, na¬
notably
tax
that
Germany
are
by mid-summer;
Government
duction,
with
after
possible;
tional income and business activ¬
ity, while somewhat below 1944,
should
still
continue
at
a
high
level compared with pre-war; cor¬
porate profits should continue
substantial
a.
scale,
on
although
slightly less than this year; there
will be
vast
a
further
increase in the
demand for goods
combined with a high degree of
purchasing power and constantly
accumulating savings.
pent-up
A
.
progress
be anticipated
the end of the
feat,
has been
highly selective stock market
characterized by
wider
intermediate '/movements
is
anticipated,
accomplished in these conferences,
so far the projects are in tentative
than were witnessed this year.
rather than finished-form, and in The individual series
comprising
view of the conflicting- views pre¬ the "Investment
Timing Index"
vailing concerning, them it is al¬ should
be
watched
for
major
most certain that they will un¬
changes in trends and particularly
dergo considerable Revision before for any change in the signal of
receiving final ratification.
the "Index" itself as indicating a
XVI.
Earnings ahttDividends
Motion Pictures
Utilities
Unfavorable factors include de¬
mands by labor for
a
Nations
an
Extensive
heavily
in war production may be ex¬
pected to cut dividends, and in¬
ventory losses may; be a problem
for such companies.
Industries
that are not handicapped by seri¬
ous reconversion problems should
Telephony
Below 1944
Aircraft Mfg.
Automobiles
week,
the
Some companies engaged
Aluminum
mum
This., index has
passed its peak, about. 26% above
Variety Chains
Machinery, Agric.
for higher
hourly rates to offset loss of over-
The unions will press
con¬
the part of the
on
Corporation earnings in 1945 are
likely to be slightly less than in
1944 with dividends little changed.
from 56 hours and 48 hours to 40
hours.
to
appears
unions.
While
Auto Parts
Labor will be in
Of
can
Living
Statistic^
,,
Chicago.
Unemployment
tageous position to bargain after
of
successfully withstood
labor
at
after a decline, forecast
by the Bureau of Agricultural
Economics, of 5% to 10% in cash
from
Cost
certed criticism
1944,
1945 EARNINGS OUTLOOK FOR MAJOR INDUSTRIES
even
influence
ing
leveis.
Government's index of the
living, made by the Bureau
Labor
have
of
.
income
labor
The new Congress next year is
of commodities
expected to give consideration to
practically
un- matters that have
been the subject
commodities, except
where Government support
proves
to be a factor.
Medium-grade bonds
the
der
price
reflect, higher
XII.
The
United
materials.
surplus plants
level.
The
increase; some
to
day.
keep prices close to 1942
made in
months after Germany
war
With continued low money rates
the foreseeable future, high-
grade bonds may be expected to
remain at the present high price
gradually
V^E
and material costs, but will try to
ex¬
1945.
tion and individual
ceilings
is:
posal of
duce tax proceeds from
should /be
after
may
Great
show much diminution for several
is defeated
contract cut-backs re¬
OPA
and
pected
War Surplus Disposal
It appears
;•
i
30, next, will pfobably be
level
of
industrial activity are
continued, with price support and tending
increasingly to move up¬
control policies maintained
during ward into the price area formerly
1945, although food and gasoline
occupied by medium-grade bonds,
if
when conditions warrant,
shortages.
VIII.
Bond Prices
The reorganization of the State preciably
higher than the top
maintaining Department, including appoint¬ prices reached in the bull move¬
traffic volume at a high level in ment of several additional .assist¬ ment
'tfr&t was interrupted by the
1945, with earnings on a seasonal ant secretaries, appears to indicate "reconversion" readjustment, and,
basis comparing favorably with a determination on the
part of the as usual, special situations must
the latter part of 1944.
The roads Government to do everything pos¬ be independently appraised.
/
have greatly strengthened their sible to stimulate
foreign trade.
XX. Conclusion
financial position, and continued No large increase in dollar amount
The year 1945 promises to be
debt
reduction
is
anticipated is likely, however, Because goods
even more eventful than 1944 has
through
1945,
with
dividends in volume will hardly be ready,
10% in the subsequent months of
as war
on
June
industries next
that continued slow
and,
expire
to
due
in
than hitherto.
reserves
XVII.
Railroads—The longer war will
This
cent
adequate
result in the railroads
relatively
plentiful labor supply.
leading
progress will be made in the dis¬
spending may not
OP A,
standpoint of business^ ing of these benefits and also the
On the basis of comparison'with addition
of
disability insurance
1944 earnings the industries and
and insured hospitalization in a
theirearnings : prospects
are general program of expansion of
divided anto
three
categories—; social security., .,;/%/•%
above, the same, and below.
XIV. Foreign .Trade
may
War bond drives will be contin¬
war
The
the
the
of operating
companies'
present earnings for the duration
of the war, with a decline of about
ued, since
ap¬
level, and begins to
anticipated while the war with show a slightly declining tendency
Germany continues; following its which is most likely: to be con¬
end, gradual expansion is logical tinued next year.
~ *"
although not sufficient to show
XIII. Social Security
designed "to prevent re¬
interfering with
production for military needs,"
and blocks plans hitherto made
for expansion in 1945 in a number
assuring
ending of the German
encouraging an increase in
the latter. ■■'/■
probably
The
collapse.
level, with
low
a
early
war
order is
particular
already at
controls, there
XI.
/..
cost of
an
production
the
until
/\;;V
of
are
prices.
production
and increasing
war
great danger of inflation
next year.
■■
■,
;Y"
goods rather than in hard, which
The War Production Board has
levels
of price
nance
the unit (physical) volume
probably will be lower. The de¬
cline is expected to be in soft
continues.
renegotiation, many corpora¬
tions will be able to set up more
up
pears no
year,
it will continue to be
long as the German war
civilian
dollar
the
at
supplies of civilian goods in pros¬
pect, combined with the mainte¬
rationing
volume of retail trade in 1945 may
be approximately the same as this
,
year ago,
so
employment
modified
tween
While reconversion in its pres¬
ent stage represents progress from
slow
and
tendency
a
commodities
With declines in
•
of the Index probably will be be¬
Distribution—While
a
and
agricultural
in the latter half of 1945 the range
Germany,
Reconversion
the
to
Thereafter, depending on the suc¬
cess of the Japanese war, the de¬
increasing possibly to 8 millions
after Japan is defeated.
;;
VII,
Some
year.
Index has already declined
sation
war.
with
war
this
present level of 229, and probably
will reach 225 at the time of ces¬
3% to 5 millions following
the end of the
than
from
probably
Unemployment, now less than
one million, may reach a
peak of
from
less
continues, with
many
approximately
serve
stringent obligation
a
be
may
Production. —The
demands,
especially after Germany is de¬
feated, the number of strikes will
Will not feel
1945
easing of controls Will probably
be accompanied by higher costs.
contracts
savings and the
hardly be larger than pent-up demand for goods due to
will
the three
membership
into closed shop agreements.
in
ratio,
now
slightly under 50%, should
decline in 1945 to the legal limit
of 35-40%, one or more of several
remedial measures may be intro¬
duced, such as reducing the limit
to
-
Government holds
with
least to sag thereafter unless the
feat, the total volume of business
conversion from
Money and Banking
trol of the money market anrifc the
or
of
-
for
10%
pledge made during the
-
Early in 1945 the House-Senate
Joint
nance
with Ger¬
war
cancellations after Germany's de¬
(Continued from page 2803)
.reduction
changed while the
With activity declining to some
extent as a result of war contract
And Securities in '49
tinue
Business
Thursday, December 28, 1944
show the best results.
By
reason
of their experience
reversal of main economic trends.
(Foregoing article is reprinted
from "Investment Timing" of Dec,
21,
1944, published
by the Eco¬
Department of the National Securities
a.nd Research Corporation, New
York, N, Y. The survey reflects
the consensus of the Department's
staff, Dr. Fred R. Macaulay, econ¬
omist, Dr. Max Winkler, consult¬
ing economist, and L. H. Bradshaw, Editor.)
j
nomics
and
Investment
.
Volume
160
Number 4346
THE COMMERCIAL & FINANCIAL CHRONICLE
Calendar Of Mew Security Flotations
List
issues
of
tatements
lays
sec,
become
course
accelerated
••
effective,
together
net
used
tration
statement
cumulative
for
preferred
the
$100, Of
par
he used to
has
un-
Union
100,000
shares of
series,/
to
named
be
bv
W*
'Hose
has
CO,
filed
statement
297,500 shares of common stock,
The
shares
which
163
to
of
its
CO.
for
employees
58.440
to
sub¬
the stock
on
are
the stock
the laifc sale of
Stock- Exchange on
good
for -five
Since
the
from
years
the
have
3,.' 1944.
two per¬
subscribe to
from
the
forfeited
and
common,
stock
2,000
employ
not
of
H::
The
AMERICAN
INVESTORS
CO.,
The shares are issued and
not
do
represent
/■: •.//
company.
outstanding
financing by
new
-:!■!./
••
:
vestment
Diversified,
-n-r
Lehman
Brothers
and
principal underwrit¬
filed by amendment.
part
offered
of Lazard Freres
its
partners
who
The
interest
j
PRESSURE
NATIONAL
Claire,
com¬
1945,
for
and
on
Proceeds —Will
due
tb
added
'
'<•
1
to
1965,- of
be
the
Joan
a
bonds,
filed
bonds
with
headed bySAlex.
oh
and
tke
to
■'■■■
21,
common
used
&
the
over
of
public
the
for
Sons
Proceeds—Will
the
be
added
will
/
$10
trucks,
real;
of
ceeds
may
/
,
Proceeds will
.
Price to
underwritten.
Not
Septr
.
general
15, 1944.
buildings,
13,
1944.
21, 1944.
Sept,
•
withdrawn
statement
:
machinery,
Details in
Hov,
:
^
company.
be
-
j
FLORIDA
Registration Statement No. 2-5549. Form
(12-21-1944).
v
//;./..,
s-i.
WEDNESDAY, JAN.
;
10W:
GINGER ALE, INC., has
filed a registration statement for 50,429
shares! of cumulative preferred stock
(no
CANADA
DRY
par). Dividend rate will be filed by amend¬
ment.''
\
,
Address—100 East 42nd Street,-New
'
City.
ger
ale
York
"/•'."•■
Business—Manufacture
and
other
and
sale
carbonated
of
gin¬
beverages,
Offering—The 50,429 shares of cumula¬
tive preferred stock are being offered b"
the company for subscription to the hold¬
ers of its common stock at the rate of one
share of preferred for each 12 shares of
common held.
The subscription price and
record dates will be supplied by amend¬
to the pub¬
not subscribed
ment, as will the offering price
lic of
for
the shares which are
by
stockholders.
Proceeds—It
nection
with
is
the
anticipated that in
continuation
con¬
of the ex-
"Chronicle,"
INDUSTRIES,
ten-year
1954.
directly
INC.,
statement
debentures
Debentures
by the
for
matur¬
be
to
of¬
at par and
company
underwritten.
Details
preferred
dividend
-
pOWER CORP.
tration statementr for
lative
filed
a
40,000 shares
stock
will
rate
~
,
(par
regisr
cumu,
$100).'' The
be
supplied by amend¬
proceds from the sale of the
new
preferred stock, together with addi¬
tional funds from the treasury to the ex¬
ment.
Net
tent required, are to be applied as follows,
Redemption of ,28,762 shares 7% cumula¬
tive
pfeferred'atj$.110
per share
$3,163,820:
redemption of 5,-940 shares of 7 % cumula¬
tive preferred"at$52.50 per share $311,850;
doilation to Georgia Power & Light Co. tc
be
used
for
Proceeds
for
redemption
of
certain
Proceeds
is
to
capital for
liabilities
the
added
will be
to
Company stated its pres¬
by
balance
such
use
the
additional
reduction
of
cur¬
approximately $300,000
in the production of its
pictures.
Emanuel
&
Co.,
New
York/ heads the list of underwriters.
Filed
1, 1944.
Details in "Chronicle," Dec.
Dec.
1944. ;/:<
7,
MOORE
v:.
of
its
WINDSOR
CORP.
has
a
registration statement for 100,000 shares of
L2% cent cumulative dividend and partici¬
pating
-
preferred stock,
par
$1
share.
per
The net proceeds of approximately $200,000
will be used for working capital and ex¬
pansion of the company's business.
Cobb
&
Co.,
principal:
the
Inc.,
New
underwriter.
public $2.50 per
1944.
Details
in
York,
named
price to
Filed Nov.
"Chronicle,"
aow
Stock is to be offered for sale b\
company.
of
pursuant
to
Commission's
bidding Rule U-50, and
names
underwriters^will be filed by post-effec¬
tive
amendm'^f. The succesful bidder wil)
the .dividend
rate on the
stock
name
Filed.
July 21, 1944. Details in "Chronicle,*
July 27, 1944,
•'
erally.
At
SERVICE
CO. has
outstanding
Federal
and
being
are
filed
a
sold
bv
Water
& Gas Corp.
The shares
constituting
approximately
56.53%
of the outstanding stock of the
company,
are
owned by Federal Water &
Gas
Corp. which will receive the entire
proceeds from the sale.
Securities
ordered
and
Federal
terest in
tration
to
On
Feb.
Exchange
divest
Nickel
10, 1943,
of
its
in¬
Ohio, and Ohio stated in its regis¬
statement it
is
informed that Fed¬
eral is selling the stock in order to
comply
with-that order.
Otis & Co. are principal
underwriters,,
(n
Filed
"Chronicle,"
//THE
OLD
has filed
a
shares of
Dec.
Dec.
STAR
14,
7,
1944.
Details
,
Meanwhile
ville's
bonds
also
100%
CORP.
registration statement for 5,000
$100
Aug.
24,
TIDE
14,
1944. Details in "Chronicle,"
1944.
WATER
POWER
registration Statement
mortgage
bonds
series
CO.
for
due
has
filed
$4,500,000
Nov.
1,
a
first
1975,
and $1,000,000 sinking fund debentures, due
1955 are to be offered for sale at
competi¬
tive
bidding.
1944.
Details
Amendment
of
filed
Dec.
9,
original filing in "Chron¬
icle," Oct. 12, 1944.
single
a
new
issue
reaching market.
But the
underwriting fraternity, far from
being disturbed by the pause in
offerings,
was
and
inclined to look back
the
a
candidate for
another piece of bopd
revamping.
Seasoned Market Quiet
seasoned
cheerful mood
12-month
best,
in
And
in
as
good
a
in
fact,
on
between
Lustig to Be Partner
Jerome B. Lustig will be admit¬
ted
times
had
it
issue
new
needed funds.
V
i The average
be known,
disposed to look
was
it
for
heavy
out.
afforded
ciate
it
the
ceptions
two
or
long list of recent
a
ex¬
new
issues> is closing the
prevailing
those
at
floated.
year with
prices
ruling
above
which the bonds were
In
premiums
some
substantial
cases
the rule.
are
January Active Month
issues and
was
in
easy
benefits
reach
almost
as
market
next
promises to be
month.
these
of
closing
to
certain
doesn't
really active
days
hear
in
as
appre¬
accruing
of
much
as
former
years
the element of reinvestment
demand, but evidently there is
still
semblance
some
buying
in
the
early
of
this
weeks
to
year
and
Year-end
it
carries
of
consid¬
corporate
disburse¬
ments in the form of dividend and
interest
have
payments
large, though not quite
as
at the end of 1493.
.
.
bulked
heavy
as
Such funds
naturally will be seeking
total
to
month, Janu¬
a
*
One
lets.
the
several public utilities
on
erable weight.
office personnel.
With
quiet week.
a
And with only one
the
the
out¬
new
'
.
issues
new
proximately 3 billion dollars face
proached 4.7 billions, and it
approximately
three
times
turnover
in
About 25%
the
preceding
What is
it
the
year.
of the total this year
took the form of
new
capital.
important, since
more
represents;
potential
issues
estimates
ahead.
be
may
side,
it
While
the
hit
a
is
the
on
calcu¬
now
billion
a
is
dollars
the
on
in
There is
closing wit¬
now
continuation of the trend
shrinking return in spite of the
sharp expansion in new offerings.
measured
by
Moody's
of high grade corporate
the
2.98
per
with
a
indicated
yield
cent,
which
figure of 3.12
per
cent on
1943.
while
cent
Sickness Benefits and Group
Purchase of Medical Care for In¬
dustrial Employees, A
Selected,
Annotated
trial
Bibliograph
Relations
Indus¬
—
Section,
Depart¬
Chase National Bank
Semi-Annual Dividend
The
Dec.
for
utilities,
National
declared
dividend
ord
of
70
bn
Bank
semi-annual
a
cents
at
the
a
share
on
close of business Jan.
11,1945.
*
Stoker Looks Good
Standard Stoker Co., Inc., offers
an
top
it is now 2.96
against 3.07 per cent
course,
Chase
27
the capital stock of the bank, pay¬
able Feb, 1, 1945, to stock of rec¬
compares
per
currently is about 3.24 per
grade, of
C.—
D.
paper—10d-
currently is around
cent against 3.55 per cent a year
ago,
of Docu¬
on
For high grade rails the aver¬
age
Agency, Superintendent
ments, Washington 25,
gainsaying the fact
no
of
As
Preliminary
Housing
stitutions, Princeton University,
Princeton, N. J.—paper—3Q0.f
The year
a
A
National
ment of Economics and Social In¬
are
finding it in¬
creasingly necessary to sacrifice
yield where security is a major
nessed
News,
—
issues
new
investors
factor.
Estimate
prospective calendar.
Yields Still Shrinking
that
Housing
new
business, is the huge roster of
new
Man's Bookshelf
was
Stock
Exchange, effective today.
Lustig, a member of the Ex¬
change, has recently been active
The Business
amount, the- year was the best
since 1936 when the aggregate ap¬
Dec. 30,
broker.
down to the idea of
operations
involved
are
help
van
a
standpoint
of activity, could
experience a bit
of a rush.
But by and large the
Street
seemed
to
have
settled
of
up
With most houses pinched
for
primarily
receivership
from
needed
much
cleaning
bookkeeping
which
as some¬
blessing in disguise,
a
time
/
firm, if the truth
the year-end lull
upon
mar¬
to partnership in B. H. Roth
Co., 25 Broad Street, New York
City, members of the New York
&
individual floor
the market
about
several occasions to pitch
help the Treasury raise its
thing of
list,
and
With at least two large railroad
such paper
an
of
ary
bonds,
as
speculative
secondary
ing the corporate
on
over
to implement the
cldsing their books for the
counted
in and
market
in order
given unstintingly to the cause of
war financing,
virtually suspend¬
ket
bond
quiet affair
a
rails, which have been in the
years.
average
Mr.
Great Northern
reported
The
and
Filed Aug,
Jan. 9.
on
is
year-end.
close, passed without
eight
Nash¬
refinancing is on the
cards
for
early January, along
with
Pennsylvania, which will
sell $51,782,000 general mortgage
institutional investors paore or less
disposed to forego new commit¬
Quite in keeping with custom,
one,
&
big
12
lated that something more than
preferred stock, non-cumu¬
non-participating.
Price
to
public will be' $110 per share; proceeds to
company $100.
Proceds will be used for
construction of distillery,
$250,000; working
capital, $250,000.
No underwriter named.
lative
Louisville
the
the balance of the week what with
this week, bringing the year to a
the expiring
may
26
-
REPORT
a
itself
"C" 414s sometime around
middle of next year.
promises to be
REPORTER'S
in
develops
now
operation, this
time involving
$60,000,000 of its
outstanding
refunding
series
the
roseate
1944.
DISTILLING
it
Plate
another
sponsor
The
OUR
Commission
itself
rate
any
that
task of
more
the
refinancing,
•,/■;■■■■ brought to market running to ap¬
!
WATER
registered
$6 preferred of Georgia Power & Light Co,
$75,600, alid expenses $80,000, total $5,the
;
$422,839,000
16.
registration statement for 80,880 shares of
:ommon
stock, par $10.
The shares are
$1,400,000; payment to Genera'
&, Electric Corp. for 4,200 shares of
031,270.
!
of
success
Plate
$42,000,000
of
n e w
securities, evidently has lent a
fillip to railway refundings gen¬
5
51,223,000
10,
Nov.
1944././/////
OHIO
H.
is
Offering
share.
W.
company
competitive
4
since
filed
securities aS provided in recap plan of that
Gas
16,552,000
109,767,000
Filed Sept. 27
"Chronicle," Oct. 5. 1944
in
intention
working
the
•
V
years.
Filed
motion
had
Part of the pro¬
EXCESS INSURANCE CO. OF AMERICA
expended for plant expan¬
nas iiled a regisfifation statement for 48,-;.
sion,
reconversion' and changes and for
.181" shares -of /dapital stock
(par
$5),
tools, machinery and equipment,; .
'■•//.,/
Shares are to be Offered for subscription to
/ Underwriting—Principal underwriters are
present • stbckhdikfprs
of record May 31/
Kuhn, Loeb '& Co., Blyth & Co., Inc., Cog1944, on a, pro ra|a basis at $8 per share.
geshall & Hicks, First Boston Corp., Glore, Net
proceeds will/ be added to company's
Porgan & Co., Harriman, Ripley . & Co.,
capital and surplus funds.
Unsubscribed
Inc., Mellon Securities'Corp.i A. G. Becker
shares Wilh be sold - to1 Lumbermens Mutual
& Co.,
Merrill Lynch,: Pierce, Fenner &
Casualty Co, for / investment. " Filed May
Beane, Union Securities Corp., A. C< Allyn
29, 1944,
Details* in "Chronicle," June. 8,
& Co., Inc., E. H. Rollins & Sons,
Inc.,
1944,
/ : ■ / /-.-../
SIade,"&. McLenh, Tucker, Anthony & Co.,
/1''
f' *rr
vand G. H. Walker & Co.
; ;/
;
; ;
funds
1,
working capital.
and
not
was
capital.
share.
estate,
Registration
•
the
in
registration
a
6%
Nov.
rent
at
acquisition of land, equip¬
working
per
Filed
etc,
be
'
to
10
in
refused
Sept"; "20, 1944. Details in "Chronicle,"
28. 1944.;
r.;//
'Chronicle,"
public
Details
PARK
.filed.
ent
a
EUGENE FREEMAN CO, has filed
a registration statement for $300,000 trade
acceptances, : Proceeds will be applied to
organization expenses, acquisition of motor
refrigerators.
Offering—Price to the
supplied by amendment.
1944..,
of
underwriters.
are
stock, par $10.
De¬
conditions
-V:-1: /:.
Nickel
18
gen¬
stock
1944.
LINCOLN
issuance,
Commission
competitive
stock-ipar $10).
for
and
ment
Filed
Busiuess—Peacetime production is manu¬
facture
Co.
All
deposit shares
period
a
the
to
price.
to
registration statement for 100,000 shares
of 5 V2 %
cumulative convertible preferred
banking
1944,
resounding
recent
35%
76,181,000
to>. the
a,
cash
TERMINALS, INC. has filed
registration statement for 25,000 shares
.
a
••,
stock
common
offered
be
same
asked
be
trust for
29,..
8,
will
the
at
&
1944.
A,
from
a
Brown
Dec.
jurisdiction
thaf
that
Percent
premiums paid by them upon
policies issued by Mutual,. Votcertificates representing shares
interest.-". Not
proceeds
treasury
18
maintained/*
/'vC-
Address—Evansville, Indiana.
proportion
additional working capital.
first
series
net
THE
has
the
in-
will
Bioren
fered
the
reg¬
$12,500,000
The
awarded 5Dec.
be
registration
Statement for 60,000 shares of $4.50. cumu¬
lative preferred stock (no par).
INC.
SERVEL,
for
voting
ing
offered for
etc.
piled Nov. 10, 1944.
"Chronicfg," Nov. 16, 1944.
release
Sept.
9
of
SEC
Amount
$148,131,000
20,985,000
50,-
pre-emptive
share
public
Fune
CORP.
COASTAL
a
S-l.
TUESDAY, JAN.
for
1964.
bank
Tne
been
working
Registration Statement No. 2-5548.' Form
(12-19-1944). /': /,
/; //i;
V, ;
J,
will
follows:
CO
for
subscribe
subscribed
■he
will be used for., refunding purposes and to
make payments on account of eouipment
of
'
in
/•/;■•,/!
POWER
mortgage
sale
the
from
Jan. 25,
\!
Details
bidding.
Filed Dec. 4,
"Chronicle," Dec. 7, 1944.
Dec;:*. 1,
$2,500,000
to
Feb.\25.
expire
be
bonds
statement
declaring
and/one-half
stock^hbld. The
rights
subscription
lot
have
to
are
per
trust
ng
principal underwrit-;
June
The
refunding
4%
97 V2.
ratio of one
each share of
the
in
offered
be
stockholders of record
common
shares
will
sold
to
$20
at
competitive
satisfied
stock
be
Dec.:
4%.
Issue
Underwriting-—None.
Offering—The
named
Details in
tails in
pany is manufacture and sale of pressure
cookers, aluminum ware and can sealers,
i.
at
group
the
of
will
rights
luo.
purchases,
CO.
Wis.
business
Business—Normal
which
com-
at
INSURANCE
registration statement
a
Germantown
to the
required,wwill be used to redeem, at
of $2,350,OQO first mortgage bonds,
istration
of common
Address—Eau
the
filed
FIRE
MONOGRAM PICTURES CORP. has filed
the
COOKER
by
be ofierea
w>
CAPITAL-TRANSIT CO. has filed
registration Statement for 150,stock (par $2).
a
000 shares
has
$250,000
&
Offering has been consummated.
Registration Statement No. 2-5547. Form
8-4/ (12-19-1944).
!
'i.:-!
has filed
financing
are
as
4,071
13,659
000 shares of common stock, $20 par, and
voting trust ■ /certificates for said stock,
Pplicyholders of 'Mutual Fire Insurance of
of
has;
1944.
the company
in
shares
general fuiias of, the company
sale
of Lazard Freres &
will still hold a sub¬
after the
firm
its partners
and
stantial
will receive
345,000
are
4,257
a
A,
by-type of lender,
42,172
GERMANTOWN
holders
105,
recordings in October,
133,480
eral
series
amount of
22,145
■
Rails Back in Picture
The
.
filed
Insurance
are
holdings
proceeds.
Co.
be
the
of
and
Co.
to
shares
has
respective
filed
nation's norf-farm population. The
estimated
number
and
dollar
47,176
companies
1943.
ments
...
CORP.
for
company;;
-
Proceeds—The
and
stock
Filed
reports of mortgages
on
$20,000 or less recorded in
counties having two-thirds of the
:
grain
extent
Off "ring—Price to the public will be filed
'
the
V,
of Arthur J; Schmitt, President
Director,; js to be offered at. $10 a
ihare.
Company- will use its part of pro¬
ceeds for
working capital/
Van Alstyne,
are
based
are
of
associations
Other mortgages
with
be
trust
Individuals
May
in¬
by amendment.
1959
common
and
registration statement for $2,000,000 first mortgage
bonds,
series
A,r
iVa%, due Dec. 1, 1974.
Proceeds together
Co.,
will
Others
ers.
—•
Freres &
Lazard
PHENOLIC
in
loan
companies
'*'•■ "
■'::-/■: ■/■
,
Debentures
•
insurance
Mutual savings banks
;he acount
has
of the closed-end type.
company,
Underwriting
!
na^ement
m»
of
1944.
8,
ARKANSAS-MISSOURI
the
■■ /.;
York City,
Address—44 Wall Street, New>
Business
million
one
6,
1944.
'Chronicle," Dec; 14. 1944.
stoclylno par;.
common
Bank
md
irs,
INC., has iiiea a registration siaoepient ior
220,000 shares of
estate
and
Moel & Co.
,//;::/.w
SUNDAY, JAN 7
GENERAL
a
prac¬
"These estimates by the Federal
Home Loan Bank Administration
Okla., community who
represent" fibw
oany.
their options.
.■■■•■.'
of
Insurance
real
and
entire year of 1943.
savings
FHLBA, which
/'/•": :*.//.•"
the
period
tically equal to the volume for the
mutual
.
1943
some
of
involving
Number
Savings
bt
parJ£I per- share.
The common
issued "and 'outstanding and dbes
is
•
sinkine
i5-year
due
and
said
will
registration statement for $1,500,000 5%
convertible
sinking fund
debem-
*
;ures
14, 1944. Details in "Chronicle,";
1344.
21,
to
resigned
company
Piled Dec.
Dec.
Jan.
issuance of the options
the
of
4feU.it
AMERICAN
Options are
the
and for industrials 2.75 per cent
against 2.93 per cent at the end
as new
"During the first ten months of
this year, recordings by all types
of lenders aggregated some $3,850,000,000, a gain of 21% from
banks increased by 7% from Sep¬
tember to October.
A continued
ELEVATOR
construction
Filed Aug.
•'
:■
the New York
on
that day.-
holding options
sons
shares
interested in
are
companies,
not recorded
are
mortgages.
"Recordings by mutual savings
Proceeds
(rtfrchase
the Alva,
elevator.
ordinarily
a^registration, statement foj
construction
people in
exercisable at $7.50 per
125% of the market price of
Jan. 3, 1944 as evidenced by
share, being
banks,
added:
TERMINAL
due^: 1954.
the
the
end
shares.
The options
wbos
subordinated
for
trust
deter
tr> ;
bushel elevator, with a three million bushe!
nead
house.
To
be
offered
mainly,, to
aggregate of 299,500 shares of
stock, the options varying from
common
filed
notes,
used
scribe to an
300
has
.und
and
to
PUBLIC
nation
nearly equal to the com¬
October volume for banks
but
not
ready
$110,000,000 for the month.
companies
fiiei
of purchasing mortgages al¬
made, transactions which
years
is
been
ago,
Have,
unknotvn.
tee
S250.000
par).
administrative
and
officers
executive
(no
registered are to cover options
issued by the company on Jan.
were
1944,
3,
ALVA
MANUFACTURING
registration
a
more
dates
.»«
iUDe
were
re¬
activity in the financing
of sales of houses,
mortgages re¬
corded by individuals increased
by 5% over September, reaching a
and
of
il»l
d
Dec.
1943. Believed
largely due to their
bined
' V)
TUESDAY, JAN. 2
BUDD
itiof
•
»«iu»
dayt/'EaftSr
ffering
13, 1944. Details in "Chronicle,!';
1944.
'
1 !" v;/" v /'""
G.
pit-,stint
registraiion statements
went}
amendment
Piled Dec.
EDWARD
OFFERING
UNDETERMINED
to cur¬
working capitals.Harriman Ripley &'■
Co., In?., heads the group of ,underwriter/
others
dF
DATES
011
mortgages
present
This
rent
o/V' :
*
...
redeem in
Any remaining funds will be added
21,
•//
the
in
explained by the increasing prac¬
tice of those institutions in recent
Home Loan Bank
non-farm
„otal of
,
Dec,
No. 2-5550. Form
$8,3l;8,272' wil
February, 1945, at $31
per share, all of the outstanding shares o;~
convertible preferred stock of the company,->
with
; / -.J1/
Stiitfement
(12-22-1944)1
/;
3-i.
under¬
ance
during Oc¬
tober totalled $422,800,000 — 2%
over the
September volume and
9% above the figure for October,
Corp.-
the
4V2%
stock,
proceeds
'
Registration
regis
a
Securities
Weeks head
that
corded
warehouses,^ the
writing group-/
filed
9
purchase
of
new
machinery and equipment for the proposed
new
plants, thei purchase of additional
delivery equipment, for the improvement
and rehabilitation of existing plants, etc.
at the discretion of the
BROTHERS
establish¬
the
for
Federal
Administration announced
acquisition of additional plants
and
and
^/MONDAY, JAN. 1
BUTLER
the
$ith other funds
Underwriting
■
of
The
the
will be
and. Hornblower/&
;
of
proceeds
ment
;•
.
the
1936
company,
than twenty
according to dates
registration statements will
normal
n
stock;
registration
-
less
grouped
ago,
which
n
whose
filed
were
in
in recordings for insur¬
companies in the month is
decline
Recordings Higher
%
program/commenced by the com¬
■
pansion
pany
NEW FILINGS
Oct., Non-Farm Mortgage
2831
interesting situation with
attractive
post-war
cording to
a
outlook,.
an
ac¬
memorandum issued
by G. A. Saxton & Co., 70 Pine St.,
New
York
City.
memorandum
may
Copies
be
the firm upon request.
of
had
this
from
THE COMMERCIAL & FINANCIAL CHRONICLE:
2832
Teletype
BRAZILIAN BONDS
with the
Preferreds
do
yon, that as we
general public,
business
no
Robert Reis, Common
yours, in making
firm trading markets in
accurate
P.ARL MARKS & P.O.
FOREIGN SECURITIES
and
THE
COUNTER
INC.
OVEII
V
.
-
-
SECURITIES
M. S. Wien & Co.
*
(Actual Trading Markets, Always)
SPECIALISTS
•
,
■
40
.
——
Governments"
45
the
on
week.
and the
have showed
activity in
'■
a
:'.y
Although there was substantial
.
.
can
a
Y
Riverside Cement "A"
$1.25 Cumulative Participating
.
v
,
deficiency in
a
excess reserves.
.
.
...
->stock
reserves
excess
banks
Circulars sent upon request
.
.
.
.
reserves
10
.
work. ;
a
'■
.
SQUARE
MASS.
9,
Tel. HUB 1990 '
Teletype BS 69
.
between Nov.
have
Northwest Cities Gas
V
have
in
are
position to become
a
.
y;;
.
•
'
&
Bonds
Power Co.
Bonds
Distribution
very
beneficial effect upon the earnings of these institutions.
Stocks
Lincoln
Term.
Whse.
Stocks & Bonds
Central Warehouse/ Corp.
>
Likewise full employment of these reserves will also have
.
OFFICE
BOSTON
The member banks outside of New York
reserves,
POST
This has had
City, which have the
important in the
government 1 bond market, when they decide to put these funds to
...
excess
LERNER & CO.
entirely disappeared with a deficit in these
of $60,000,000 being reported for the period ended Dec. 20.
reserves
;
'
It is indicated that
.
.
HIGHS
.
upon as attractive for sometime,
purchase these obligations, and considerable
15, and Dec. 20, the New York City
acquired $60,000,000 in bills, $214,000,000 in
certificates, $680,000,000 in notes and $604,000,000 in bonds, while
attributed to the practical absence of "joyriders."
;
Restrictions upon speculative subscriptions to the securities
offered in>the drive were strictly enforced and this had a favorable
effect upon the market "for these issues, when they were traded in,
for the first time.' on' December. < 18.-".V
>■■v•?
PARTIAL EXEMPTS AT NEW
equalling their
favorable effect upon the government bond market while at the
time it has improv'ed the earnings of these institutions.
Excess
Loan, and this was
.
m
Outstanding Cement Stock
With a Dividend Arrearage
,
institutions
member
government bond market following the ending of this drive,
much more orderly than it was after the close of the Fifth War
was
9-15-67/72
highs for the year with
old high.
The 2*4%
same
^
■
Industry
1-576
new
fully all available funds in government securities.
The
,
an
Bright Future
a
Giant Portland Cement
teletype
yoric
have learned to operate without excess reserves,
and have followed the advise of Federal that the banks should invest
2% bonds and the 1U% note? was due to
ORDERLY MARKET
:
due
institutions, that
these
adjustments
portfolios by banks and other institutional buyers. . . .
in
new
With
The New York City member banks, have been
making full use
of their funds and for the third successive week, these institutions
day of the free market, with the same price holding for the week. .
% % certificates due 12-1-45 opened at 0.83% bid and finished
the week with a bid of 0.82%. . ...
\ •
- ;
the new
bell
v
v
:
5
YORK
telephone
A Low-Priced Stock in
'
demand came into the market last week for these issues.
opening day, and advanced to 100 9/32 bid by the end of the
The 1 ¥4% notes due 9-15-47 were 100 7/32 bid the first
reported that considerable of the market
Association
NEW
-.Enterprise 6015
.
was
STREET,
philadelphia
•
Dealers
due< 9-15-56/59 have been looked
for
...
It
Security
21/2% due 12-15-63/68 all made
214%
the
The
:
HA. 2-8780
1-1397
Y.
An
opened on Monday, Dec. 18, at 100 8/32 bid, and ended the week
bid, in line with expectations. . . . The called 4s which
were
exchangeable for these bonds had indicated a premium of
about 10/32 for the new 2s when they were available in the open
market.
The lxk% due 3-15-66/71 were quoted 100 4/32 bid
.
York
NASSAU
REctor 2-3600
at 100 10/32
.
New
telephone
Sixth War Loan showed that all four of
offered during the drive were selling at pre¬
The most widely favored issue, the 2% due 12-15-52/54,
.
.
.
N.
INCORPORATED
Members
the marketable issues
miums.
Security Dealers Ass'n
Teletype
,
Kobbe, Gearhart & Company
By JOHN CHIPPENDALE, JR.
The first week after the
Y.
Exchange PI., N. Y. 5
CHICAGO
,
U0ur Reporter on
Members N.
New York 4, N.Y.
AFFILIATE: CARL MARKS & CO. Inc.
Adolf Gobel
%
OUR whole attention is
-
v
Majestic Radio
2-0050
•
B||
England Public Service
.
IT is important to
all issues
50 Broad Street
28, 1944
Howard Stores
Telephone
HAnover
New
REMEMBER..
Markets
Firm. Trading
NY 1-971
Thursday, December
,
''
;
1
Common 'N
Continental States Tel.
activity in the drive issues last
'■
SIXTH WAR LOAN TOTALS:. ' ' :
;'v *
held the spotlight with
Indications now point to a total of about $21,000,000,000 for the
the year. . . . The 2%
Sixth War Loan approximately $7,000,000,000 more than the goal of
due 6-15-53/55. at 105 24/32 bid, and the 214% due 6-15-54/56 at
$14,000,000,000 and about the same as was raised during the Fifth
167 23/32 bid, were at all time highs since the date of issuance. . ; .
Wat Loan.
Preliminary figures on the sale of Series "E" savings
The 2%% due 3-15-55/60 at 112 23/32 bid, the 2%% due 9-15-56/59
bonds, indicate that the quota of $2,500,000,000 will be exceeded.
at 112 4/32 bid, the 2%% due 6-15-58/63 at 112 4/32 bid and the
2%% due 12-15-60/65 at 112 16/32 bid were at new tops for the year Purchases of bonds by individuals have already amounted to more
than the $5,000,000,000 figure set for the drive.
and only slightly under their all time highs made in 1943. . . . The
partially exempt issues have improved substantially since the drive
and are up sharply from the lows of the year which were made
Youngstown Steel Car Div.
Adrian Franfeel V.-P.
about three months ago on Sept. 21. ;.,1 Many things have happened
Youngstown Steel Car Co.—In
since these securities sold at their 1944 lows, the most important of
addition to the regular quarterly
Which are probably, the changed war conditions and more realistic
dividends at the rate of 60c per
thinking on post war taxes. . . >,'■■■■
'
Adrian
A.
Frankel
has
been
annum,
this
company
recently
However, in some quarters, the opinion is held, that in view
made a Vice-President of Selig- declared an extra dividend of 10c
of the sharp advance in prices of the partially exempt issues, it
man, Lubetkin & Co., 41 Broad
payable Dec.
26,
according
to
is important for institutions to make certain that the tax advan¬
Street, New York, City, as of Jan¬ Townsend,
Graff
&
Co.,
120
tages in these securities are sufficient, to offset the large pre¬
uary 2, 1945.
Mr. Frankel, who Broadway, New York City, mem¬
miums and the better return available after taxes, in some of the
has been with the firm for 15
bers of the New York Stock Ex¬
Bonds'
.
week, the partially exempt obligations again
six of these securities making new highs for
Henry De Keester & Co.
Members N.
Y.
Security Dealers Ass'n
11 Broadway; New York 4
...
.
,
.
Telephone;
.
Bell
WHitehali
Teletype;
-
NY
4-1044
-
;
1-1721
,
-
taxable securities.
.
.
•
.
Ayr',".':.
NARROWING SPREAD
The taxable securities retireable in 1952, show a larger yield
than is obtainable in the 1953 maturity of the partially
after taxes
exempts, with three of the 1952
taxables on a higher yield basis after
than is available in the 1954 maturity of the partially ex¬
empts.
.
Only in the last four maturities of the partially exempts
is a larger return available after taxes, than in obtainable in the
taxable issues.
Also this advantage which the partially exempts
have over the taxable obligations is narrowing to the point, where
a not too substantial rise in these issues would eliminate the spread
taxes,
.
.
.
in
yield
.
.
after taxes,
taxable-issues.'
will
years,
taxable obliga¬
tions as a whole are more suitable for their purposes. . . . All of the
taxable securities maturing or callable from 1945 through 1951, give
a
better return after taxes than do comparable maturities of the
partially exempted. .
'■
y'."
/
between the long partially
exempt and the
have
charge
'•.••••.v,
/V--""'• ~
The strength in the government bond market last week was not
confined to the partially exempt issues, since several of the taxable
securities also went' to new highs for the year. .
.
The 2% due
12-15-51/55, the-2%% due 9-15-56/59, the 2%%' due 9-15-62/67,
;
.
"7.-
7.
..v
.
Eastern States Pfd.
versus
Public Utility,
have prepared an attractive book¬
let containing the first article;
have been
III. Power Div. Arrears
Fifth Ave
Corporation. 350
New York 1, N. Y.
Mr. Norfleet
Abbe Street.
many
& Co.
years
Telephone COrtlandt 7-0744
Bel!
Teletype NY
1-886
Stocks & Bonds
We
' Page
Insurance Stocks...,.,
Broker-Dealer
Personnel
Calendar of New Security
Securities
Funds
-
Industrial Issues
2812
Investment Trust Issues
Items.... .2818
Flotations 2831
..........,....
.............,......
Securities
Public
2811
.2815
Tomorrow's
Securities with
Markets—Walter Wliyte
Says
—
....
.2806
SECURITIES
a
New Engl Market
Frederick C. Adams & Co.
.2808
Salesman's> Corner....... 2807
Utility Stocks and Bonds
TEXTILE
................2807
Real Estate Securities
Securities
specialize in all
Insurance and Bank Stocks
:
Bank and
Railroad
••
.
New
'
Specialists in
England Unlisted Securities
24 FEDERAL
for
with Barrow, Leary
STREET, BOSTON 10
Established In 1922
Ohio Securities Section
on page
Tel. HANcock 8715
Tele. BOston 22
2810.
over
8% each at current market
Chicago South Shore & South Bend R.R. Common
EMPIRE STEEL
Maryland Drydock Common
Miller Hart, Inc., Prior
«
208 So. La Salle, Chicago
Telephone RANdolph 3736
Common
Pfd,
(Information available on request)
•
\
CRUTTENDEN & CO.
Members New
Inc.
Teletype—CG 989
BS 328
.
REMER, MITCHELL &REITZE
Bell
was
Teletype
Hanover 2=-7913
Last
Reporter pn Governments...',.2332
Our Reporter's
Report.............2831
Public Utility Securities............2808
offices at 1401
New York
Hubbard 6442
INDEX
Mutual
—
9, MASS.
Boston
$10%.
Canadian
John U.
Norfleet is engaging in a securi¬
ties business from
J
Municipal News and Notes.........2816
Norfleet Opens Own Firm
Bought—Sold—Quoted
New York 5
rising prices.
Our
Lumber & Timber
W. t. BONN & CO.
an
stock lately at
sale
BOSTON
year.
There has
increased demand for the
run¬
Copies of this booklet may be hac
upon request by writing to Marl
Merit, in care of Schenley Distill
ers
RALPH F. CARR & CO.
$12.43 last
ning in the "Financial Chronicle.'
Yielding
Real Estate
U. S. Radiator, Pfd.
specialists in the issue.
Aug. 31, 1944 shows
for the stock of $13.73
Industrial
Pressureiube, Inc.
Broadway
been
Schenley Distillers Corporatioi
in the series they
Elastic Corp.
Balance sheet
Available On Request
Unlisted
^
change,
equity
SHREVEPORT, LA.
120
the
of
firm's trading department.
(Special to The Financial Chronicle)
...
ALL ISSUES STRONG
United
.
do not need tax shelter, the
For institutions that
es
CHICAGO
„nq
York
and
^ south Lafealle Street
Teletype
CHICAGO 4, ILLINOIS
CG 35
Hill, Thompson & Co., Inc.
Chicago Stock Exchanges
T
Dearborn 0500
LOS ANGELES
634. So-
Sprinjr st
Telephone
Trinity 6345
Markets
120
and
Situations
for Dealers
Broadway, New York 5
Tel. REctor 2-2020
tele.
NY 1-2660
Wi
If
Volume
160
& FINANCIAL CHRONICLE
THE COMMERCIAL
Number 4346
.
2847
Total Loads
Freigfrt Oar LcadifepOuring Wesk ?
Ended Ees.,8 S,I
Decreased 5.5%-
..J
ended Dec. 10, 1944
tojtalvd fi4j,883 cars, the Association of American Railroads announced
on Dec. 23.
This was a decrease below the corresponding week of
1943 of 8,998 cars, or 1.2%, but an increase above The same week in
194z of 6,822 cars or 0.9%.
•'■.%■";/!!:, %•
YY: 1
Y
YY'.'Y"
Loading of revenue freight for the week of Dec. 16, decreased
431,671 cars, or 5.5% berow the preceding week. ;; -*1; . \
* Y'P
• ;■<
Miscellaneous freight loading totaled 377,381 cars, a decrease, of
9,924 cars below .he preceding week, but ah increase of 28,720 cars
above the corresponding week in 1943.
-Y.v Y' <■!■%! Y !
i :
s
;Y
: i •;
Loadings of merchandise less than carload lot freight totaled
102,058 cars, a decrease of 4,754 cars below tne preceding week, but
ah increase of 3,328 cars above the corresponding week in 1943.
Coal loading amounted to 142,863 cars, a decrease of 26,842 cars
below tne preceding week, and a decrease of 34,216 cars below the
corresponding week in 1943.
■ ;;
!,J Y; YYjYYYY! Y YV.Y YYj
I '*
Gi ain and grain prouucts loading totaled 44,678 cars, an increase
of 4*.8 cars above the preceding week but a decrease of 3,895 cars
below the corresponding week in 1943.In the jW est em Districts
alone,- grain and grain products loading for;:>the week of Dec. 16
totaled til,343 cars, an increase of 1,646 cars above the preceding
week but a deciease of 2,126 cars below the corresponding week in
,1943... v'T'vY.-./ YjY ■YJYY>Y:;/>y
'Y'vY.; %YY■ Y;.:r Y;
Livestock loading amounted to 19,234 oars, a decrease of 873 cars
below: the p.eceaing week but an increase of J2,215, cars above the
corresponding week in 1943. In the Western Districts alone loading
of: live-SvOck for the week of Dec, 16 totaled 14 628 cars a decrease oi
791 cars below the preceding week, but an increase (if 2,068 cars above
of - revenue freight for the week
Loading
•
-
•
•
•
.
■the coiresponding week in 1943. •
: Forest
products loading totaled
t
,
preceding: week and a
below* the
Y. ,YYY'Y.
:
39,409 cars a decrease of 421 cars
decrease-of 2,370 cars below The
corresponding week in 1943.
Che loaaing amounted to
11,115 cars, a decrease of 1,069 cars
below the preceding week and a decrease of 1,166 cars below the
corresponding week in 1943.
v Y-.
Coke loaaing amounted to 13,145 cars a decrease*of 216 cars below
the preceding week, a decrease of 1,614 cars below the corresponding
week in 1943.
y
•!YVY',Y'YY''lY'';1^^
YV%Y
All disaicts reported decreases compared with the correspond¬
ing week in 1943, except the Southern, Nordiwestefn, Centralwestern
and Southwestern but all districts reported increases compared with
1942 except the Allegheny and Pocahontas, v 4^
t-v.-'-'-V-1943
.«44
ol
Weeks
weeks *
■4
February
of
of
Weeks
4
6' weeks
61
4
weeko
5
weeks, of
ox
Georgia
387
1,701
1,820
to
1,303
3,317
3,152
nual
372
255
262
107
92
706
802
2,404
1,967
1,510
1,406
45
46
44
126
102
.960
1,023
1,312
2,818
2,306
—
400
237
343
781
612
Georgia & Florida—
3,649
3,7.98
3,799
3,885
26,378
16,250
16,131
Chilton
24,442
11,555
II,50.
mours
214
139
191
854
1,063
324
166
548
453
2,996
3,243
3,137
4,480
4.611
844
881
824
1,889
1,751
428
394
334
1,348
l,38f
459
363
11,126
9,916
10,396
8,852
9,06t
24,753
—
Piedmont Northern
Richmond, Fred. & Potomac
/
—.
'411,.
10,2o6
...
...—
23,326
22,119
21,518
659
739
552
807
Winston-Salem Southbound
179
128
127
912
120,760
116,235
System...
14.319
14,241
2,574
2,453
3,239
3,18!
20,129
19,385
10,553
10,131
3,945
3,939
3,754
3,898
3,496
255
229
1,142
1,003
1,086
607
737
635
628
489
8,496
8,125
8,078
11,803
9,675
378
390
451
140
118
12,017
12,280
11,905
Atlantic—
Mgin, Joliet & Eastern.
Dodge, Des Moines & South
Ft.
;
Great Northern..
6,011
4,912
445
L02
801
243
56
45
2,040
545
474
267
Ishpeming_——
Minneapolis & St. Louis
Minn., St Paul & S, S. M.
243
,
.
2,607
2,456
5,387
5,444
4.944
2,858
2,949
10,774
10,560
10,690
6,031
183
ICO
122
5b9
691
2,612
2,397
1,851
3,825
3,266
87,759
84,671
82,460
1,959
2,047
!
—_
Spokane International
Spokane, Portland & Seattle
:!
-
5,438
61,666
67,188
3,403
2,744
3,176
•
379
Bingham & Garfield
the
71
75
11,703
Railroads
758,881
295
Ann Arbor——.!——
Bangor &
—
Indianapolis & Louisville——.
Central Indiana.——
5,450
1,293
24
33
1,104 ;
& Western—
Detroit fit Toledo Shore
*
ing, Beltsville, Md.-
6,273
6,26;
ers
749
20
16
A'
627
1,040
,1,588
1,65c
1,777
1,646
1,431
1,756
1,002
977
575
462
1,741
2,152
114
132
995
940
754
15,003
15,40!
,/
853
11
>,';■ 16.
32,047
27,967
11
!:■
28,537
341
293
434
1,698
1,705
16,887
15,716
17,4o4
15,97!
671
678
3
2,165
2,026
4,077
4,72v
129,792
120,285
121,858
100,341
96,533
...
—
'.:
■
1,235
2,024 : !
'5,814
2.514
;-:-'a;302
43,91 lr,7; ikj! 1,300
9,008 L- !.; 8,165
1,102 - ' : 869
5,943 Av.->67456
.
606' ^
517
6V751
4,479'
503
863
257.
/'
—
219
.
.
164
6,212
!.fl' 5,484
2,440
2 989
2,134
3,383
3,528
3.265
234
271
450
1,002
1.092
5.001
4,800
2,675
'
'
!
570
:
3,184
3,196
4,027
2,551
2,337
2,766
340
302
288
1,247
1,153
616
778
856
474
4 854
■—______
—.
:V
.
;
,
Quanah Acme & Pacific
:'
;;
173
!'
6,352
193
-
I'll
69
5,711
17,888
19,485
ii4
303
218
;v
8,448
6,972
2,522
4,796
6,011
5,939
5,328
7,468
7,207
83
89
'.'51
139
22
14
32
49
,! 71,286
72,583
67,232
67,370
:
flncluded in Baltimore & Ohio RR.
363
5,38/
4,158
142,347
303.^:^317.:!
934
325'r!^eir~«71
:
"!:' 5,301
4,513 ^rr4„-09
; "
"146,362
■•■■■.■
.-
200
2,240
1,073
cates
from the National
us
members
of
this
Association
the
83%
represent
of the total
statement each week from each
a
production, and also
activity of the mill based
a
figure which indi¬
These
the time operated.
on
1,015
11,905
3,999^
^
.^40^74
Paperboard Industry
herewith latest figures received by
member of the orders and
!.'! 266
2,444
212,908
figures are advanced to equal 100%,
4,169
'223,431
industry,..;. Y-'
Y
Y:"Y'
;
so
that they represent the total
:
■
\
■•!•
•
"Y
Y
Youngstown.—,
Ohio...Erie————;——.
Akron, Canton &
Baltimore &
—
770—.;%705
741
^"35,286
2,479
26,661
26,093
1,407
1,349
t
4
38,352
1,740
2,220
-
Central R. R. of New Jersey.—.
6,602
Cumberland <fc Pennsylvania.—
126
475
.
Island——A———————
1,273
.2—
9
.'
Union
(Pittsburgh)
Western,
—
,.A
486,818
96
94
482,896
95
September
23-———.—
125,258
10
September
30
160,952
42
32
October
3,710
3,404
October
14
2,375
2,260
October
21.
■57,511
62,062
October
28.
twli,496
27,208
26,157
19,706
2,627
4,178
3,120
20,119
4,2:9 t*"" "3:538
12,470
12,232
164,731 ** 156,248
155,147
157,133
'
94
158,946
541,424
96
94
139,347
154,719
523,875
96
94
133,028
—_!—__
l,46rf/v. "M?S47
;
'217,096
7—
13,125
;
161,114
159,114
53
12
17,972
Maryland—_
94
94
52
74,282-!-r 68/696
94
80
97
C
129,481
549,114
97
525,730
,^31
14,845
:
1
158,178
16—
1,865
Current Cumulative
Tons
554,352
September
156,269
499,929
94
146,003
157,806
486,882
95
207,817
—
4___—
157,644
535,745
96
Norfolk As Western.———
Virgip lan——-r
■i'"'Totali—'i-j—
—
21,155
28,028
15,879
22,619
^
2,485
4,664
^
39,519
10,846
"^,260
7,415
2,308
20,368
21,278
*
4,616
52,169
-
V..
teller
a
on
in the first World
lieutenant and re¬
in
bank
the
1919.
A
of Defiance,
O., where he
was born Dec. 8, 1890, Mr. Carter
obtained his A.B. degree at the
University of Michigan and work¬
ed in the State Bank of Defiance,
joining
Last
Federal Re¬
when he was
granted a leave of absence be¬
cause of ill health, Mr. Carter was
the oldest person in point of ser¬
vice in the bank's employ.
the
June,
Exchange Colombia Bonds
Dr. Gabriel
Turbay, Colombian
Ambassador to the United States,
is
notifying
of Republic
holders
of Colombia 6%
external sinking
gold bonds due Jan. 1, 1961,
6%
external sinking fund
bonds of 1928, due Oct. 1,
1961, of an extension of time from
31, 1944 to Dec. 31, 1945.,
within
which to
exchange the
94
94
94
94
and
bonds
appurtenant
coupons
for
Republic of Colombia, 3% ex¬
ternal sinking fund dollar bonds
due Oct.
1, 1970.
The notice adds:
period for exchange of
convertible
certificates for
3%
external sinking fund dollar bonds
"The
due
Oct.
1,
1970, in multiples of
November
11
141,154
158,266
515,738
18—_—_—
135,644
156,667
494,062
96
94
$500, has also been extended one
November
25—
450,898
91
94
year.
484,811
94
94
95
94
94
94
December
7,165
2,107
"
55,311
11,805
26,293
'
as
November
December
———:——
,
Federal
He joined the Army
110,144
149,062
189,731
2—
154,682
The
,
exchanges
*
District—
the
96
'
Pocahontas
30
"
November
December
Chesapeake & Ohlo_
retire
Dec.
<
123,758
18,137
...
Remaining
'•!
V,
•
131,988
19,842
■
155,182
Reading Co..*—
__!—
...
Y.
155,820
" 124
'
Tons
173,065
September
■
70,390
Penn-Reading Seashore Lines...,
Pennsylvania System—
—...
north¬
than
gold
Percent of Activity
Orders
Production
Tons
1944—Week Ended
September
1,013
138
1,188
■■•!.
Received
5
'.'raw'—:
—
,
Orders
.
"(624
391'^!
70
.•—
■
8^44
4
6,513
219
•
1
1,765,^; :>1,756
1,360
Cambria <fe Indlann_.__.__
'.
Period
,
295
Buffalo Creek & Gauley..
Long
1,162
34,583
Bessemer & L ake
Ligonier Valley
1,229
native
and
STATISTICAL REPORTS—ORDERS, PRODUCTION, MILL ACTIVITY
.
i!
.
:
Bank staff
ro*e
turned to
fund
Unfilled
Allegheny District—
a
before
industry, and its program includes
10
11,964
5,673
v
7
.
The
widely
of which his father was President,
revised.
8,163
8,614
more
joined
private
to
War,
5,713
Paperboard Association, Chicago, 111., in relation to activity in the
paperboard industry.
VYY'VYY'Y-V :
16,202
5,902
7,379
-
Carter
Reserve
6,940
Statistics of
We give
2,621
15,983
:
after
Oct. 29. 1914.
8,132
31
figures
31
serve.
17,903
2,455
,
Mr.
2,832
.!■■'■
8,107
74,524
year's
Reserve
and
of service with the bank.,
years
9,007
18
3,192
Dec.
on
12,944
Weatherford M. W. & N. W
55,123
•.
ern
78
figure,
Federal
Cleveland
among bankers of
and central Ohio/will
2,971
Wichita Falls fir Southern
Total.
Y Y" Y'Y*-;
known
13,564
._!____
Texas & Pacific——!.—.
Ret Ire
to
of the
of
Bank
3,737
9,227
——
——
Texas & New Orleans..
488
.
President
12,900
St. Louis Southwestern
Note—Previous
Reserve
as
St. Louis-San Francisco..—
♦Previous week's
Carter of Cleveland
366
5,666
16,384
16,302
80
—
552 >
126
6 296
5,795
16,755
Missouri-Kansas-Texas Lines
Missouri Pacific
Birmingham, N. J.
'
195
Missouri & Arkansas—
'3,469
19
17,966
1,091' :
678
•
48,634
717
Pittsburg, Shavcmilt &
.'
-.
-7,108
'4,994
'
■:
■
407
■
.6,750
4,770
'
■
„
'■
4,793
■
J2,052
^;!. 5,B74.
6,158
-
Wheeling & Lake Erie.——;
/
1,007
Pete Marquette—
184
!■!!: 367
303
Permutit Co.,
Elbert A. Carter, Assistant Vice-
2,748
i;—_
City Southern—!!-
Ernest W.
Nachod, and William Wood of the
■
11,565
9,869
Hartford.'.——
New York,'Ontario & Western:——.
New York. Chicago & St. Louis.——:—
N. Y., Siistiuehanna to Western
—
Pittsburgh & Lake Erie———-——
';,,!■! ;;
6.879
Burlington-Rock Island
l,o65
11,417
1,837
N. Y.. N. H.&
:.!
-1"':
*
2,485
2,641
i9S3®at!«i*oi
1,637
42,378
New'York Central Lines..—————
—
•-
•Y
!
Other speak¬
at this session pre:
Thiele, Standard Oil Company of
Indiana, Whiting, Ind.; Donald S.
Herr,
Resinous
Products
and
Chemical Co., Philadelphia; and
Sidney
Sussman,
Frederick
D.
11
2,488
Gulf Coast Lines
3,514
"Base Exchange
on
by Sterling B. Hen¬
4,142
785
Southwestern District—
■8.50?
paper
867
17,4/2
1,400
4,853 d
•
Rutland.
2.862
•! 8.285
3,412 L'' r3;500
a
Silicates"
4,089
,1,654
;
15,828;.
10,H03
11,62a,!,
102
90
1,227
244
.304
.
9,956
8,210^8,118
2,348
——_i—i
Wabash.—.—
364:
.!
1,853
Central^,——G-—y.
North———Plttsburgjh & West Virginia
—
!.
.298
1,544
3,579
11,845
12,155
10,029
8,008
Montour——t-j.——.—
Pittsburg & Shnwmut
5.760
6J79
163
no
Lehigh & Hudson River
——.
Lehigh & New England————-.—Lehigh Valley.—————
Monohgahela—!—-
48
2,499
2,033
11,106
:'
Maine
56
2.025
191
i
2,120
1,947
31
1,584
rrj.r-
Line
Grand Trunk Western.—_.
214
of
dricks, Bureau of Plant Industry,
Soils and Agrict.ula.ural Engineer¬
System
Midland Valley
l.oos
5,756,.
7,250
MackinacA.—w———.
Detroit, Toledo fit Iron ton..—————■,
-
.
The afternoon session will open
with
b,03.
Louisiana & Arkansas..
13,722
14,772 "
1,409
••
1,023
4,833,
7,213
;
Delaware & Hudson—-:
Delaware, Lackawanna
572
^•,-,1.616
Wilmington,
■'
2,300
1,613
Litchfield <fe Madison
1,506
1,495
258
6,629
1,314
,.";v
Central Vermont—.■
Detroit fit
.
1.826
6,511
„..
Boston & Maine.—————.
Chicago,
:
2.404
Aroostook.
Corporation,
1
12,082
1.018
Kansas, Oklahoma & Gulf..
1943
1944
Corporation; George H. Schefi'ler,
4,811
International-Great Northern—
:
con¬
Chemical
2,331
42,234,992
Connections
■
Johns
and
Davison
13,243
,743,061
1942
the
1,048
526
Union Pacific
Loaded" *
1943
the
of
University,
of
2,433
of the flight carloadings for
1944
District—
Patrick
A.
12,173
—__
Total—i————
Freight
Eastern
Walter
Hopkins
695
Toledo, Peoria & Western
Total Revenue^
of
2,392
17,492
759,731
744,183
Western Pacific..
%
:
Institute
11,427
«
823,311
Received from
Mellon
Research, Pittsburgh;
Roger K. Taylon of the Davison
Chemical Corporation, Baltimore;
940
■
Kansas
the
of
865
2.273
Southern Pacific (Pacific).
(NUMBER OF
mett
Industrial
2,444
784
3,236,584
lYY^YY-yY;
morning
2,864
City—
,Y7." 862,733
CONNECTIONS ,,
CARS).WEEK ENDED DEC. 16
Total Loads
the
628
808,260
AND RECEIVED FROM
at
4.017
3,365,925
FREIGHT LOADED
speakers
17,882
—
October
REVENUE
Other
19,263
Peoria & Pekin Union——.....
4
John W. Kassler and Wil¬
12,855
North Western Pacific!.—...
YEII
of the Carnegie
Technology,
Pitts¬
2,674
3,604,323
.
Berl
of
12,074
4,410,669
corresponding week a year ago.
G.
2.842
3,607,851
3,304,830
railroads and systems for the yveck"'nhded Dec. 16, 1944.
tiyi^period 66 roads showed increases'when compared with
"For¬
658
Fort Worth & Denver
the separate
During
on
39,243
Chicago, Burling ton & Quincy
Chicago & Illinois MidlandChicago, Rock Island Sr-Pacific..
Chicago & Eastern Illinois.—...
v..:
following table is a summary
paper
session will include: Paul H. Em-
3,772
3,842
773
594
"
The
Walter
10,766
13.135
22,364
a
and
Darco
21,490
Matthews
Properties of Acti¬
Carbon," by Ernst Berl and
Del.
24,819
Brander
with
p.m,
mation
sultant
Central Western District—
Ateh., Top. & Santa Fe System..
de- Ne¬
ginia Pulp and Paper Co., Tyrone,
Pa., will report "Recent Studies
on the Nature of Active Carbon."
2,474
21,978
uuiutxi, ivussaoe & iron Range
Pont
liam E. McMinn of the West Vir-.
l.
...
du
13,741
13,836
Chicago, St. Paul, Minn. & Omaha..
Chicago Great Western
Chicago, Milw., St. P. & Pac
3,311,637
*
begin in
9:30
burgh.
Denver & Salt Lake
' "
116.17C
121,619
117,069
I
Theater, 420 West 117th Street, at
vated
15.054
.....
Denver & Rio Grande Western-
41,776,644
will
954
Northwestern District-
3;363,1!»5
42,737,534
844
E.
sorption and Ion Exchange" will
be the general theme,
sessions
Institute
■!.'!. 4,456,466
YjY~lY*;-l aY-iY
.'
of
and Co., Wilmington, Del.,
Chairman of the Division,
''Ab¬
10,137
25,183
Tennessee Central—
Total———
Society
University on Friday,
Dec. 29, it is announced
by T. H.
24,706
317
Northern Pacitic___
an¬
sym-
Chemistry
26,552
Mississippi Central—
Duluth, South Shore &
engineering
at Columbia
24,826
.
Chicago & North Western.
and
expected
are
of the American Chemical
27,266
Nashville, Chattanooga & St. L——
Norfolk Southern—
Seaboard Air Line.—!
chemists
postum of the Division of Indus¬
trial and Engineering
;.L
—...... ...
Macon, Dublin & Savannah.
Southern
chemical
4,401
Illinois Central System.——
engineers
participate in the eleventh
———
Gulf. Mobile & Ohio
."Louisville & Nashville
hundred
Several
chemical
345
—.
Colorado & Southern
749,883
4,848
154
•
4,209,907
'
9,890
5,763
....
Gainesville.Midland—!
3,174,781
^
12,666*
257
.
3,122,942
793,554
2,593
I,458
2,769
Durham & Southern—
Florida East Coasts—!!--■!
4,428,427
:-2—
1,370
1,708
377-
Columbus & Greenville
3,598,979
December
2,657
:
304
Ulinchfield——
.Nevada Northern•_.!
—
387
■
1,330
Charleston & Western Carolina.—:
Novembei
of
Total:
3,831
—_
ihinois Terminal..—...—
\9_——
Week of December 16
.—
':
13,438
3,478
—
Missouri-Illinois-——.—
oi December
Week of
11,595
3,364
Atlantic Coast Line—.—
Central of Georgia-:
3,487,905
A ugust
of
Weeks
Weeks
13,160
691
Chemistry Engineering
1943
346
659
•.:■
'
3,431,395
weeks of September-.
4
711
4,139,395
5
4
■714
745
'4,003,393
weeks of
Week
716
% 3,455,328
;/*;*';:"3',554,694
4
298
313
4,343,193
July
1944
404
Atlanta, Birmingham & Coast.!—
3,463,512
3,579,800
June..
1942
Atl. & W. P.—W. R. R. of Ala——
3,055,725
V;
4,068,625
1943
Alabama; Tennessee & Northern..
3,924,981
3,135,155
Connections
1944
..
3,073,445
-
3,44),252
weeks of
4
'
3.159,492
-
^Larcli:
A-o"
1942
,
3,858,479
3.796,477
January..—„—_
Received from
Freight Loaded
Lake Superior &
.
6
Southern District-—
"Total Revenue
■'; *
,
Green Bay & Western
,t
f
r'^L'vY Railroads
173.669
Notes—Unfilled
not
necessarily
orders
equal
154,822
501.946
137,936
9__;
16
152,695
480,929
of the
the unfilled
prior week,
orders
at
plus orders received, less production, do
the close.
ordeis made for or filled from stock, and
ments of unfilled orders.
reports,
-
Compensation for delinquent
other Items mads necessary adjust¬
copies
of
New
of the
:
being
offer,mav be ob¬
Bank's Corporate
tained from the
Trust
ef¬
The National City
York, as agent;
fected through
Bank
are
Department.
-
2848
THE COMMERCIAL &
Items About lankr, Trust
B.
Earl
Puckett, President and
director of Allied Stores
tion,
elected
was
Corpora¬
director of the
a
National
Commercial
Bank
&
Trust Company of New York, 46
Wall Street, New York, Walter G.
Kimball, President, announced
Assistant
A;
stcck will be entitled to 25 of the
sistant Trust Officer.
As
the
name
implies, the Club is composed of
employees who have been in the
and Trust Company
service is Richard N.
Cotter, As¬
of New York,
appoint¬
Dec. 22 the
on
Alexander
of
ment
MaximoW
as
Manager of the Foreign
Department and* Paul R. Vervoort
Cashier.
Assistant
as
;
H.
James
Allen
appointed
was
Board
Manufac¬
of
turers Trust Company and himself
member of the Club by
a
virtue of
service with Man¬
Trust
Company, ex¬
tended his greetings to the mem¬
bers of the Club and their guests,
and
presented
the
emblems, to the
new
membership
members.
In
addition, Mr. Von Elm presented
fifty-five-year emblem to Julius
It, Von Sternberg, Vice-President,
a
tertainment
elected
officers
for
the
coming
year are William Haas, President;
Henry W. Becker, Vice-President,
and Joseph C. McNally, SecretaryTreasurer.
Richard
N.
Cotter
is
Honorary President of the Club.
It
is
the
Fourth
Office
Avenue
of
Manufacturers Trust Company, lo¬
cated at the corner of Fourth Ave¬
is
27th
and
nue
Street, New York,
observing its 25th anniversary.
Established in December, 1919, as
the Industrial Bank, the institu¬
tion
at the
located
was
southeast
corner
of Fourth Avenue and 27th
Street.
Three years later the bank
Was
with Manufacturers
merged
Trust Company.
fice
In 1932 the of¬
to the northwest
moved
was
completion of
majority of the stock
a
upon
will be in the hands of individuals
Board of Managers of the Buhl
Foundation, died on Dec. 19, at the
age of 81 years.
Mr. Linderman
joined the Bank in 1880, and be¬
has served in
years
capacity
a supervisory
accounting divi¬
the
in
sion of. the
personal trust depart¬
p'';.
'
ment.
general
for
ficials
the
the
of
bank
The
Dime
Street where it has remained
since.
operating
after miking
1945,
sistant
Vice-President, is the of¬
in charge.
ficer
The transfer
on
Dec.
31, 1944, of
S500,G0() from undivided profits to
surplus of the Lawyers Trust of
New York
board
was
of
nounced
on
of
it
Dec. 19.
known at the
board
authorized by the
directors,
same
was
It
was
an¬
made
time that the
directors
has
declared
the regular quarterly dividend of
25 cents a share, payable Jan. 2,
1945,
stockholders
to
record
of
E>ec. 23, 1944.
for the year
Estimated earnings
were reported as most
satisfactory.
John E.
the-
New
York
Trust
Company,
of New
York, announced the elec¬
tion
Dec. 26 of Alfred Brittain,
on
Jr.,
as
Vice-President,
a
He will
in the
serve
general banking de¬
Mr. Brittain, a native
partment.
New
Yorker, is
Phillips
Exeter
graduate
a
of
Academy • and
Yale University, class of 1918. His
business career has been entirely
in the banking field in Chicago
where he
Central
was
Trust
associated with the
Company
Assis¬
and
Vice-President
tant
as
th'e
Northern Trust Company. He was
a
Second Vice-Presfdent of the
institution
latter
signed
Trust
to join The
Company.
he
New
re¬
York
provision for
be in excess of $3
taxes, should
share on the
expected that
Board
York
of
the
of
Company
Bierwirth
appointment
of
of
The
on
the
New
Dec. 26
announced
six
officers
promotion. V. A. Wilson,
formerly Assistant Secretary was
appointed Assistant to the Presi¬
and
one
dent.
C. Barnwell Straut
was
ap¬
limited amount of
its President in 1921. He was
1914 to
also from
1932
member
a
of the
Clearing House Committee
the Pittsburgh Clearing House
of
vesting. public
lar Savings Bank.
of next month.
Dime
Mixed
Bank's Main Office,
Chorus at the
Fulton
Street
De-Kalb
and
11:15
from
nue,
Bank
Savings
o'clock
12
until
Ave¬
Saturday,. Dec. 23rd. This
marked
the
11th
annual
Christmas
Carol
from
broadcast
the
from
of
12 o'clock noon,
until
in
Philip A. Benson,
the Bank, extended
of
Christmas greetings.
kunst,
institution
former
Carl Gute-
head
of
vocal
the
appointed director of
The
Savings
Dime
Club.
A
Glee
Bank
special feature from 10
until 11 o'clock preceding the reg¬
ular Christmas Carol Sihging this
was
medley
a
Carols
Bells
Christ¬
of
played
Plains,
Mama-
and Hartsdale.
largest finan¬
Westchester
in
excess
A
plan has been worked ouj to
control
of
the
County
Trust Company of White* Plains
by
balcony
.
The County Trust Company of
Plains,
N.
An increase in work¬
Y.,
has
an¬
nounced to ils stockholders a
plan
For
Linderman
ber of
he
L.
Spray; Vice-President
Manager of Westinghouse Electric Elevator Company,
director of the First
a
15
ad-
Board
of
National Bank of Jersey City at
a
meeting of the board of directors
on Dec. 20.
William G. Chapman,
The
director
a
and
Pittsburgh Cham¬
as
member
a
Managers
years
of
the
of
committee to
a
on
the
Alle¬
gheny County Workhouse. He
Board
Fred
F.
was
of
dent Calvin
Coolidge, and assisted
in
organizing
the
Allegheny
County Emergency Association.
It
The
proposal
unanimous
capital funds to approximately
$2,700,000 with a large majority
held
stock
Westchester/
by residents of
his
In
letter
to
stockholders, Andrew Wilson, Jr.,
President of the Trust Company,
said in part:
"In
view
!
:
of
the
growth which
throughout the
County after the war, your Direc¬
tors, feel that it would be in the
inevitable
seems
National Bank of Jersey City, as
noted in
was
issue of Dec. 21,
Mr. Spray also is asr
2752.
page
sistant
our
the President
to
of West-
inghouse Electric & Manufactur¬
ing
of the head¬
manufacturing division
Co.,
in
quarters
cellor
on
Dec. 1-3
President of
as
the
Assistant Vice-
Dallas
National
Bank, Dallas, Tex., by the direc¬
tors of the Bank, was announced
on
Dec. 17 by the Dallas "Times
Herald," which said:
Chancellor, who has been
with
the
staff
of
the
Federal Reserve Bank of Dallas as
Cashier
the
in
Houston
branch,
be
will
supervisor and directing
head of the credit department, ac¬
cording to J. C. Tenison,
He has
Federal
the
with
been
Reserve
1921."
Bank since
Bank's
board
total to
$15,000,000.
"Present
Simpson, President of the
National
Bank
the
of
Commerce
directors
of
the
Bank
have voted to submit to the share¬
holders at the annual
meeting Jan.
9 a proposal to increase the com¬
mon
stock
from
$1,000,000
to
$2,000,000.
The Dallas "Times Herald" fur¬
of $20 total
312,500.,, The proposal
figures the issuance of 62,500 ad¬
ditional
shares to be offered rat¬
ably to present
$35
per
share.
Directors,
in
mind, your
cooperation
with
additional
of
sale
would raise $2,187,500, of which
$1,250,000 would be allocated to
new capital stock, and $937,500 to
surplus; An additional $312,500
transferred
be
divided
profits
making the
new
in
Bank of the Manhattan
which
has
been
stockholder for
Worked out
Company,
the
some
principal
have
years,
plan to bring about
a
to
by
Vice-
President; George D. Cherry, Trust
Officer
to
Vice-President
and
Trust
Officer;
Assistant
Officer
Trust
Herbert
Officer
S.
to
Croft,
Trust
(corporate division); Ed¬
Of¬
the desired change in control and,
at the same time, to provide more
ward N. Dean, Assistant Trust
working capital."
division), and A, E. Becker, Jr.,
who was made Assistant Cashier.
Of the present 30,000 shares of
$25 par value stock, 6,400 shares
will be retired, according to the
plan,, after which the balance of
the
stock
will
be
one-half for
one
shares
with
a
"
split
to
par
■,
■
two
create
and
59,000
value
of
$10
'
ficer
tional
will
to / subscribe
shares
then
of
be
the
for
new
offered
to
addi¬
stock
stock¬
as
incidental
step
in
the
program to provide $400,000 of
additional working capital, stock¬
will
be
given
an
tunity to participate in
issue
of
15-year 3%
oppor¬
a
limited
debentures,
(custody
Vice-President and director of
the
National
First
Bank,
Phila¬
delphia, Pa., who has been with
the Bank 36 years, of which he
spent 28 years as Vice-President,
20
director, was reported
in the Philadelphia "Inquirer" on
Dec. 18, which further said:
career
he
has held many offices in banking
groups.
He was President of
American
Bankers
Association,
1931-32;
B
a n
k
Directors
Bank,
the First National
of
Houston, Tex., approved
President, Pennsylvania
e rs~
Association,
1937-38;
President and organizer of Bank
tin-*,
surplus,
surplus $7,500,000.
April, Republic's paid-up
capital and surplus was increased
from
to* $12,500,000.;
$10,000,000
The
bank
will
its
celebrate
25th
anniversary in February."
New Greek Drachmas Are
Convertible Into Gold
In advices from its London bu¬
the "Wall Street: Journal" of
reau
*
"The psychological
hold of gold
Europe is again
illustrated by the Greek monetary
experiment.
the people of
on
"This
experiment, it is now re¬
implies
that
the
new
vealed,
drachma /notes
be converted
or military
pound sterling but also into gold
sovereigns (£1 gold coins).
The
not
only
Bank
can
into: paper
Greece
of
has
announced
that it will both buy and sell these
sovereigns at the rate of 2,400 new
This is quadruple the
drachmas.
military, pound
and
paper
notes.
"At
sorb
time," the Greek
same
its
decided
has
Treasury
to
re¬
to
and
ab¬
by the imposition of a
gold
of
tax
on
--
the
1,500 gold pounds sterling
It is
the 1,000 richest citizens.
expected that this measure will be
followed
introduction
the
by
indirect taxes since the country
of
is
disorganized to permit the col¬
"Prospects bolstering the Greek
are
considered to be
Treasury
fairly good since, at least tempo¬
rarily,
the
cost
internal debt is
of the collapse
on
is
debt
the
debts remains
of servicing the
negligible in view
of the old
this
which
in
Service
a
proposal to reduce the par value
country's foreign
suspended.
issue
ten
billion
it will be submitted to the stock¬
to
holders Jan. 9, F. M.
drachmas (50 billion old
Law, Presi¬
dent of the Bank, announced. The
for one
$100 shares would be withdrawn
half
with five $20 shares
each,
according . to
the Dallas
"Times Herald," which added that
and replaced
"the
common
the Bank
was
capital structure of
increased Dec. 5 in
sufficient" amount to retire in full
to
circulation but
pre-war
to
finance the
Following
"So far, notes in denominations
of only one,
50 and 100 drachmas
available for issue, but larger
ones
meeting of the di¬
a
of
Houston,
W.
Tex.,
N.
existing
of business.
reported to be
are
by plane.
rectors of the Citizens State Bank
new
drachmas
new), equivalent to barely
the
reduced volume
stock,
amounting to $800,000."
ud
sufficient
are
preferred
Bank's
the
currency
expressed.
"The Government's intention is
of the stock from $100 to $20 and
as
"During his banking
an
holders
Officer
The retirement of Harry J. Haas,
holders.
As
Trust
to
from
the
to
"In
common
also promoted the following:
Vice-President
at
measure
lection of direct taxes.
the
sistant
this
This
too
...
With
shareholders
ther reported on Dec. 17 that "the
chester.
stock
hands
.
stock with the par value
common
of
of individuals interested in West¬
the
the
V
price at which the bank buys and
;
stock at 50% premium, and, in
Clif- j
connection with such increase, the
ford A. Spoerl, Vice-President to i
reduction ol' the par value of the
First Vice-President;
Edwin W.
common
stock from $100 to $20
Spoerl, Cashier to Vice-President
per share."
and Cashier, Lloyd Clarkson, As¬
community to
have
widely distributed in
a
outstanding shares of
increase is to be accomplished
* of directors
by
directors
surplus would be increased
by the same amount, bringing the
sells
A. D.
charge
of the parent company.
The
the
of
The
plenish
its
Jan. 4.
would increase capital stock of the
bank from $6,250,009 to $7,500,000..
Government
of the
on
submitted
vote
that
cently consolidated with the First
sec¬
"Shareholders will meet to rat¬
Houston, Tex., recently announced
bring
an¬
the bank's
was
ify the directors' action
The
will
the
ond increase within a year; said
the "Daily Times Herald" of Dec.
20 which also stated in part:
increasing the bank's capital formerly President of the National
move designed to enable the
Bank of West New York, was also
institution to keep pace with the
elected a director.
The National
anticipated growth of the County. Bank of West New York was re¬
action
of
Nov. 15 said:
The election of Estes A. Chan¬
*a
proposed
Directors
or¬
ganize flood relief for Mississippi,
Arkansas and Louisiana by Presi¬
for
in
'
Florence, President,
nounced.
would
years
Mr.
Commerce, and for 19
"Mr.
and General
elected
was
served
connected
Ellis
Gazette"
than
more
Treasurer of the
i
few days.
"Post
vices of Dec. 20 further said:
a
ing capital is also in contempla¬
tion, Mr. Wilson said, and further
details will be made public within
a
years
Trustee of the Dol¬
a
group,
statement recently
released by Andrew Wilson, Jr.,
President
of the
County Trust
was
White
of the Manhattan
Westchester
a
Golden
on
Diana Day, from
encircling the great
dome in the Bank building.
the
White
transfer
Company.
as
appointed
from the Bank
is the newly
Association, and for several
op¬
$40,000,000.
Company to
according to
Columbia University, and
present director of music at the
Plymouth Church of the Pilgrims,
Hand
1903,
County with total assets in
lege,
mas
in
which
President
year,
Company,
Pleasantville,
Hastings
roneck,
part
It claims to be the
cial
11:45
offices
erates
made
be
Pittsburgh
Trust
founded
was
Scarsdale,
will
in< the latter
County
which
The Dime Savings Bank over Sta¬
tion WMCA, which was scheduled
during
a
shares
new
.
The
and
meeting
Trustees
Trust
President
the
It is
stock.
new
came
The
Rights
Following
for
he served
each..
when
that
connected
with
the
National Bank, Pitts¬
years
available for purchase by the in¬
•
interests of the company and the
Bierwirth, President of
earnings
William Sterling Linderman, for
Savings
Bank
of
Brooklyn entertained their de¬
positors and friends with a pro¬
gram of Christmas carols sung by
ever
Raymond F, De Mott, As¬
estimate
net
per
of Fourth Avenue and 27th
corner
Lambing
investment unit of the trust de¬
partment."
■
that
from
'-v
,
Republic National Bank of Dallas,
Texas, voted on Dec. 19 to raise
to $15,000,000 the capital stocks
and surpluses of the
institution,
trust investment of¬
was
ficer in charge of the research and
and choral work at Teachers' Col¬
The
Mr.
reliable
understood
plan
department,
Mr. Schneider will continue to di¬
rect such activities.
formerly
..
mortgage
looked for. Based upon the figures
the last twelve months, of¬
year
program of en¬
followed.
Newly
shares." '' j'r-
and
Duquesne
burgh, Pa., and Chairman of the
in point of active
service with the
additional
"Formally Manager of the real
estate
Company. No changes either in
policy or personnel are
held Dec. 21. Mr. Allen has
been employed by the company
since July, 1925, and
in recent
noon, on
A varied
one-half
learned, from the Pittsburgh "Post
Gazette" of Dec. 19, which said:
53
who is the second oldest member
bank.
and
ing as Vice-Presidents of the Peo¬
ples Pittsburgh Trust Co., Pitts¬
burgh, Pa., is announced, it is
already closely identified with the
his 41 years of
ufacturers
words, a holder
of
ten
of
the
original shares,
which have become twenty-five
of the new shares, may acquire
twelve
said."
present management of the Trust
a
the.employ of the bank since 1880.
Edward-J. Gresser, President of
the Club, presided at the dinner.
the
then
each
for
other
be given one month's salary bonus
an 8% dividend was declared
for
all stockholders,
Mr. Greer
and
The
election
of
Vincent
P.
Schneider and Malcolm E. Lamb¬
meeting of
Brooklyn, N. Y., at
the Board of Trustees of the com¬
of
addi¬
two
In
Philadelphia \f one
original organizers Wy Re¬
City Bankers Associa&on."
Assistant Secretary
of
the
Brooklyn
Trust
Company
of
an
pany
Henry C. Von Elm, Vice-Chair-
after
exchange,
one
share
held.
.
sistant Secretary, who has been in
nian
in
tional
sources
bank's service for 25 years or more.
_Tbe total membership is now,219,
the oldest of whom in length of
shares
tunity to subscribe for
New
Yorker, Dec. 19th, inducted
is adopted,
ten shares of
which he will be given an appor-
new
Officers Club in
serve
plan
owning
person
added
statement
the
liam P. Kau, Assistant Secretaries
and Frank A. Mutchler, Jr., As¬
Assistant
members.
a
dali, Russell R. Johnson and Wil¬
Manufacturers Trust Company, at
its annual dinner held at he Hotel
new
Wilson's
Mr.
Thursday, December 28, 1944
of the
•
that "when
Cran-
Walter G. Kimball, President of
The Commercial National Bank
Twenty-five Year Club of
in exchange for
or
stock.
and
Treasurer
Cole, James C.
announced
19
either for cash
Companies
on
Dec. 21.
The
pointed
Milton
FINANCIAL CHRONICLE
"Greece's
are
now
Greer,
en
route
6
main
requirements
food, raw materials and
President of the Bank, announced
clothing which the Allies are ship¬
$250,000 had
been made in the Bank's surplus
month.
that
increase
an
account.
Dafllas
In
of
reoorting
"Times
Herald"
this
the
likewise
But
even
this is said to be
insufficient, Greek estimates plac¬
ing the minimum, needed at 200,-
said:
"All officers and
ping at the rate of 130,000 tons a
employees will
000 tons."
'
@FedFRASER