The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
I
The Commercial and Financial Chronicle
2
■
■
Troster, Singer & Co.
74
Ill
■
It
Trinity Place, New York 6, N. Y.
jil
m
:&*!:
iii
Direct wires to
correspondents
An
Primary Markets
across
the country
important
function of
Over The Counter
our
business is establishing
nationwide markets
Underwriters
in
For banks, brokers and
It
sale
issues
financial institutions only
Inquiries invited
or
new
on
the purchase
m
of large blocks of stock
XvX-X\X-XvX-X-XvX\\v
■
f
v <«'i
.
.
.
Thursday, December 28, 1961
Volume 194
Number 6120
.
.
.
The Commercial and Financial Chronicle
When minutes count... at 1 Chase Manhattan Plaza
of the nation's
Working against time, the Municipal Bond Divi-
The Chase Manhattan Bank is
sion of The Chase Manhattan Bank and members
leading underwriters, distributors and dealers of:
of
a
group account come to a
final decision
on
the
STATE,
COUNTY,
PUBLIC
bid for
an
issue of
municipal bonds. After
corre¬
MUNICIPAL
HOUSING
TENNESSEE
AGENCY
VALLEY
one
BONDS AND
BONDS
AND
AUTHORITY
NOTES
NOTES
BONDS
U. S. GOVERNMENT INSURED MERCHANT MARINE
lating and interpreting developments in this highly
INTERNATIONAL
AND
competitive market, the account is ready to tele¬
BANK
NATIONAL
FEDERAL
BANKS
CHASE
Head Office: 1 Chase Manhattan
MANHATTAN
Plaza, New York 15, New York
BANK)
BANKS
MORTGAGE
HOME
FOR
RECONSTRUCTION
(WORLD
LAND
INTERMEDIATE
FEDERAL
THE
FOR
DEVELOPMENT
FEDERAL
FEDERAL
phone in its bid.
BONDS
*
ASSOCIATION
CREDIT
LOAN
BANKS
BANKS
COOPERATIVES
BANK
Member Federal Deposit Insurance Corporation
ft
The Commercial and Financial Chronicle
4
THE
.
Thursday, December 28, 1961
ASSOCIATION
AMERICA
President
Officers
.
INVESTMENT
BANKERS
OF
.
CURTIS
H.
BINGHAM
Vice-President
Vice-President
DAVID J. HARRIS
Bingham, Walter & Hurry, Inc.
Los Angeles
Bache & Co.,
Vice-President
Vice-President
Chicago
THOMAS
The
M.
JOHNSON
Johnson, Lane, Space Corporation,
Savannah
1961-1962
WILLIAM
T.
KEMBLE
Estabrook &
Boston
Co.,
JAMES H.
LEMON
Johnston, Lemon & Co.,
Washington, D. C.
Vice-President
WALTER H.
STEEL
Drexel & Co.,
Neiv York
.Volume 194
Number 6120
.
.
The Commercial and Financial Chronicle
.
<k>
CONTENTS OF THIS ISSUE
Officers
IBA
Governors for 1961-1962
IBA
Regional Group Chairmen for 1961-1962
for
1961-1962
4
6,
—22
Official Staff of® the IBA
TEXTS
OF
7
128
THE
ADDRESSES
THE
Foreign Investment Committee—Arthur L. Wadsworth, Chairman 21
Municipal Securities Committee—Alan K. Browne, Chairman___ 24
Special Committee to Study Industrial Aid and Lease-Purchase
Financing by States and Political Subdivisions—
Monroe V.
8
Bibliographies of New President and Vice-Presidents—
MADE
REPORTS
Page No.
Page No.
IBA
COMMITTEE
IBA
Poole, Chairman
Municipal Subcommittee
John W.
on
32
f
Syndicate Operations—
deMilhau, Chairman
33
Liaison and Bond Sales Procedures Subcommittee—
Walter W. Craigie, Chairman
Subcommittee
on
Subcommittee
on
34
Trading and Cashiering Procedures—
W. Neal Fulkerson, Jr., Chairman
DURING
CONVENTION
Liaison With American Bridge, Tunnel
35
and
Turnpike Association—William F. Morgan, Chairman
Incoming President's Inaugural Address—Curtis H. Bingham
9
Subcommittee
W. C.
New Frontiersmen
Imperil Our Freedom and Future—
George A. Newton
10
Jackson, Jr., Chairman
Russell M. Ergood, Jr.,
12
Subcommittee
Orlando
Shifting Gears in the Canadian Economy-
S.
on
Chairman
Brewer, Chairman
14
C. Brown, Chairman
or
War?"—John J. McCloy
16
Dilemma Confronting the United States Regarding
Latin America—Dr. Milton S. Eisenhower
—
Growing Role of the SBICs—Phil David Fine
:j:
*
; :
Companies Committee—
Herbert R. Anderson, Chairman
Gram, Jr., Chairman
18
Railroad Securities Committee—James
L.
Research
*
Are
Local
"Federal
Units
Aid
and Dates__
Able
to
„■;
Finance
to
Education?"
School
23
Needs
23
Winners of the IBA's 1961 All-Institute Essay
M.
Roster
of
the
at
62
Convention
69
Advertisers
134
63
Industry Committee—Dr. Paul F. Genachte, Chairman
Oil and Natural Gas Securities
State
61
64
Committee—
Katzenbach, II, Chairman
65
Legislation Committee—Robert A. Podesta, Chairman
Aviation Securities Committee—Edward J.
Competition (John
McCarthy and Nelson S. Talbott)
List of Those in Attendance
.
Committee, Ralph F. Leach, Chairman
L. Emery
(IBA Booklet
Available)
Commmittee—
57
Sheehan, Chairman._ 59
George B. Kneass, Chairman
Nuclear
1962 Convention Site
55
Small Business Committee—Harvey B.
20
50
Investment
Governmental Securities
F. Nichols
Alexander, Chairman
17
The Investment Banker and Merchant Marine FinancingLeonard
48
15
Canadian Committee—Norman J.
"Peace
38
Committee—Shelby Cullom Davis, Chairman 44
Public Utilities Committee—Carl
Thy Neighbor's Dilemma—Herbert H. Lank
37
Metropolitan Area Problems—
Insurance Securities
Norman J. Alexander
36
Municipal Conference Subcommittee—
Raising the Standards of the Securities Business—
SEC Chairman William L. Cary....
36
Financial Advisors for Municipalities—
on
Industrial Securities Committee—J. Victor
Federal Taxation Committee—Walter
Loewi, Chairman_
Maynard, Chairman
Educational Committee—Robert Mason,
66
Morehouse, Chairman 67
Chairman
;
68
70
71
<s!
Blyth 6X0., Inc.
Distribution
Primary Markets
Bonds
Coast to coast retail
distributing facilities
Public Utilities
through 26 offices
located in
Stocks
•
Industrials
principal
Municipals
financial and business
Banks and Insurance
centers.
Complete Trading Facilities
New York.
Boston
Detroit
Pasadena
•
Philadelphia
•
•
San Francisco
Minneapolis
•
•
Palo Alto
•
Chicago
Pittsburgh
•
Kansas
•
City
•
Spokane
San Diego
Los Angeles
Cleveland
Tacoma
San
•
Jose
Seattle
•
Louisville
•
Oakland
•
•
Eureka
Fresno
Portland
•
Indianapolis
•
Sacramento
•
•
Oxnard
The Commercial and Financial Chronicle
THE
.
.
Thursday, December 28, 1961
INVESTMENT
BANKERS
OF
.
ASSOCIATION
AMERICA
*
Howard H. Banker
Andrew S. Beaubien
William B. Boone
C. J. Devirte & Co.
L. G. Beaubien & Co.
Dean Witter & Co.
Carl M. Loeb,
Portland, Ore.
Rhoades & Co.
Cincinnati, Ohio
Ltd., Montreal
J. Howard Carlson
New York
William H. Claflin, III
Tucker, Anthony &
R. L. Day, Boston
City
Governors
1961-1962
W. Scot* Cluett
Harriman Ripley &
Co. Incorporated
New York City
John F.
Curley
Willard G. DeGroot
Charles W. Easter
Paine, Webber,
Bateman, Eichler &
Co., Los Angeles
Blyth & Co., Inc.
Seattle, Wash.
Jackson & Curtis
New York
City
George W. Elkins
Elkins, Morris,
Stokes & Co.
Philadelphia
Milton S. Emrich
Harvey J. Franklin
Julien Collins &
Merrill Lynch,
Pierce, Fenner &
Smith Inc.,
Company, Chicago
San Francisco
W. N.
Fulkerson, Jr.
Bankers Trust
Company
New York City
Joseph A. Glynn, Jr.
Lloyd B. Hatcher
Blewer, Glynn <fi Co.
White, Weld & Co.
Dean Witter & Co.
St. Louis
New York
Chicago
Edde K.
Hays
W. Yost Fulton
Fulton, Reid & Co.,
Inc., Cleveland
Fred W. Hudson
Ball, Burge & Kraus
Cleveland
Thomas B. Gannett
Hornblower &
Weeks, Boston
William L.
Hurley
Baker, Simonds & Co.
Inc., Detroit
fl
Volume
194
Alger J.Jacobs
Crocker-Anglo
National Bank
Number
6120
.
.
.
The Commercial and Financial Chronicle
Roy W. Leriche
First of Iowa
Corp.
Des Moines
Cushman McGee
R. W.
Pressprich &
Co., New York City
San Francisco
Frank R. Newton, Jr.
George A Newton
Lentz, Newton &
Co., San Antonio
G. H. Walker & Co.
Interstate Securities
St. Louis
Corp.
Charlotte, N. C.
W. Olin Nisbet, Jr.
7
Edward D. McGrew
The Northern Trust
Co., Chicago
Frank W. North
Barret, Fitch, North
& Co'., Incorporated
Kansas City, Mo.
Robert E. Moroney
Moroney, Beissner
& Co., Houston
Carr
Payne
Cumberland
Securities Corp.
Nashville
Governors
1961-1962
Robert A. Podesta
Cruttenden, Podesta
& Co., Chicago
Harold H. Sherburne
James M. Powell
Arthur H. Rand, Jr.
Harley L. Rankin
J. B. Sanford, Jr.
Boettcher &
Woodard-EIwood &
Hattier & Sanford
Company, Denver
Co., Minneapolis
Goldman, Sachs &
Co., Philadelphia
Jerome
J. Emerson Thors
Anthony E. Tomasio
Kuhn, Loeb & Co.
Thomas & Company
Erwin A. Stuebner
Bacon, Whipple &
Co., New York City
Kidder, Peabody &
Co., Chicago
Murray Ward
Robert S. Weeks, Jr.
E. F. Hutton &
Company
Los Angeles
F. S.
Moseley & Co.
Boston
F.Tegeler
Dempsey-Tegeler &
Co., Inc., St. Louis
LeRoy A. Wilbur
New York
Alex.
City
Yearley, IV
New Orleans
Pittsburgh
Victor H. Zahner
Stein Bros. & Boyce
The Robinson-
Zahrter and Company
Baltimore
Humphrey Co., Inc.
Kansas City, Mo.
Atlanta
The Commercial and Financial Chronicle
.
.
.
Thursday, December 28, 1961
REGIONAL GROUP CHAIRMEN
EASTERN
CALIFORNIA
CANADIAN
Willard G. DeGroot
Dudley Dawson
Bateman,
Eichler &
Co., Los Angeles
CENTRAL STATES
Richard B. Walbert
Greenshields
Blyth
Incorporated
&
Co.,
Inc.,
Chicago
PENNSYLVANIA
Frederick T.
Butcher
Seving
&
Sherrerd,
Philadelphia
MICHIGAN
Robert A. Benton,
Jr.
Manley, Bennett
Co., Detroit
&
Montreal
MISSISSIPPI
MINNESOTA
1961-1962
VALLEY
NEW
James E. Klingel
John W. Bunn
Juran & Moody, Inc.,
St. Paul
Stifel, Nicolaus &
Co., Inc., St. Louis
OHIO
VALLEY
Harry C. O'Brien
W. E. Hutton
&
Co.,
Cincinnati
ENGLAND
John 0.
Young
Lee
Higginson
Corporation, Boston
PACIFIC
ROCKY
NORTHWEST
MOUNTAIN
Robert A. Nathane
Merrill
Pierce,
Smith
Norman Davis
Lynch,
Fenner
Walston
&
&
Co., Inc.,
Denver
Incorporated,
Seattle
WESTERN
SOUTHWESTERN
Carl H. Houseworth
The
Columbian
Securities
Corp.,
Topeha
i
TEXAS
PENNSYLVANIA
W. A.
Beinhorn, Jr.
Russ
&
San
Co.,
W. B, McConnel, Jr.
Inc.,
Singer, Deane &
Scribner, Pittsburgh
Antonio
i
NEW YORK
NORTHERN
Allen C. DuBois
Wertheim
New
&
Co.,
York
OHIO
Jack 0. Doerge
Saunders, Stiver
Co., Cleveland
&
SOUTHEASTERN
SOUTHERN
Glenn E. Anderson
Samuel L. Varnedoe
Carolina Securities
Corporation, Raleigh
Varnedoe, Chisholm
Co., Inc., Savannah
&
Volume 194
Number 6120
.
.
.
The Commercial and Financial Chronicle
and
The New President's
9
imagination.
In the
depres¬
sion years of the thirties we were
"persona
grata"
non
the diplo¬
as
mats say.
Inaugural Address
a
Association
Hurry, Inc., Los Angeles, Calif.
sary
Looking to the future, Mr. Bingham sketches much that
be done in seizing opportunities now
re¬
and
en¬
the flow of capital neces¬
the
World
second
War
our
stock took another drop. The gov¬
ernment listed all industries as to
how
can
essential
they
effort.
Steel
below
the
the
to
were
first, etc. Our
industry ended up in 44th place
war
unfolding, in working with the
SEC's broad study, and in helping the economy to overcome its prob¬
lems. Particularly stresses what individual bankers themselves can do.
just
manufacture
artificial flowers.
fact
I
in formulating
regulations to
for financing.
In
note of the little recognition accorded its contributions made to the
economy.
and
that
of
This despite the
industry, and dedi¬
our
services we render, we can only cated men in our
industry, was
fully aware of the re¬ hope that we will continue to largely responsible for selling the
sponsibilities this high office en¬ work as effectively in the future. huge
amounts
of
government
tails.
I
I would
am
also
like to read to you bonds necessary
cognizant that
to finance the
there
were
war.
something I recently read. "I as¬
two
sume to say that the time is here
After the war our industry and
principal
proud of the honor bestowed
am
on
and
me
considerations
when it is
that
means
in
resulted
nomi-
my
curities,
(1)
Recognition
of
the
t
grow-
c
Southern
California
a
financial
love
and
fection
stand
ex¬
of
af¬
Curtis H.
Bingham
The coming year
wife, Mary.
of 1962 marks
a
and
you
can
be
sure
happen in the next 50
We
are
here
today
of
a
economy.
I
am
broadening
confident
world)
will
we
job well.
coming year our industry
subject of a broad in¬
quiry by the Securities and Ex¬
change Commission. Almost 30
our
The
will be the
years
ago
new
regulating
our
laws
business.
the
tive
protection for
more effec¬
providing capital in a
public, and to be
in
a
years.
of
since the
and
collective
itiative.
You ask what
Well,
all
can
I do?
big
accomplishments
part these laws were con¬
are
the result of little jobs done
structive.
We welcome a review
by many people. Most of you are
of these laws and regulations in
respected and influential mem¬
the interest of
most
protection for the
public.
The
bers of your community.
Work
Exchanges, with
your
School Board to see
rules, regula¬ that better
economic education is
Stock
and the NASD have
a
great contribution. The
majority of our members
great
are
honest,
but
if
provided. Discuss problems with
your elected representatives. Your
voice
We
members
as
be
heard.
Do
your
and ethical, friends and
acquaintances under¬
permit
im¬ stand
your work as they do the
part of a few, doctor's or the
lawyer's?
laws
propriety on the
they should be reviewed.
should
will
sincere
our
continue
Education
the
of
is the most effective
IBA
efforts
our
of
weapon
against
communistic
ing.
has been outstand¬
war
Likewise,
fields
eral
produced
Investment
of
our progress
State
Fed¬
Securities, and Federal Taxa¬
of great credit to
tion have been
IBA.
How about the future?
We
can
look ahead and
Underwriters and Distributors of State,
and
in the
Legislation,
Underwriters and Distributors of Corporate
see
that
i
In
see
the
The
next
few
a
few
clouds
years
on
the
we
can
horizon.
is
threatened. We can see danger in
the decline of our early national
virtues, thrift, self reliance, re¬
sponsibility and the spirit of risk
taking for greater reward. We are
stability
of
our
dollar
with
you
as
♦President
the
50th
vestment
Securities
Municipal
ALLENT0WN
DURHAM
RIDGEW00D
SANTA ROSA
CHICAGO
AT LANTIC CITY
LANCASTER
ROCHESTER
SCRANTON
American Stock Exchange, and
Principal Exchanges
OFFICES
.PHILADELPHIA
NEW YORK
BERKELEY
M0RRIST0WN
SACRAMENTO
STOCKTON
CORRESPONDENTS
IN:
SAN FRANCISCO
MINNEAPOLIS
BROOKLYN
NEWARK
SALINAS
SYRACUSE
WINSTON-SALEM
CARMEL
OAKLAND
SAN MATEO
VINELAND
BUFFALO
CI EVELAND
IN:
Dt TROII
CHARLOTTE
RALEIGH
GREAT
NECK
MIAMI
PITTSBURGH
SANTA CRUZ
YORK
ST.
LOUIS
WASHINGTON
the property
Bingham's
Annual
remarks
Convention
of
Bankers Association of
Hollywood Beach, Fla., Nov. 30,
Brokers in Securities and Commodities
other
please
could you be so blessed?
Revenue Bonds
Members New York Stock Exchange,
you
have accumulated. Where else
Primary Markets in Many Unlisted Securities
BOSTON
we
economic understanding is a safe¬
guard against fiscal irresponsibil¬
ity which destroys thrift and in¬
passed
For the
made
demand
and
were
tions and codes of ethics and have
for
capital
had to be satisfied. Huge amounts
of money were needed for munic¬
ipalities, public utilities and in¬
dustrial
companies,
large
and
small, to provide goods and serv¬
ices. We supplied it. It can just¬
ly be said our industry provides
the
money
needed
in war
or
mentals
lot growing economy.
We
have
had
our
ups
and
each downs. During the first World
year to give our best efforts to War our industry not only helped
improve our standards, solve our finance our government through
problems and plan for the future. the sale of 25 billion bonds, but
And when we look at the vigorous also in contrast to the panic of
in
condition of our economy, with 1914
European capitals, the
the
tremendously expanded ac¬ American financial community
ceptance by the public
of the fulfilled its role with composure
will
discoveries but also the
new
demands
do
oppor¬
a rapidly changing tech¬
creating new companies
nology,
with
the
The
committees
was formed to promote
high standard of ethics in the
securities business,
the 50th Anniversary of the IBA.
A lot has happened in the last 50
years
The Investment
with
are
"Funda¬ with the full realization that our your country, and of the profit
Banking," industry wilhcontinually be called system. They have brought to you
started courses at universities, in¬ on to provide huge amounts of
all the benefits of a free society
cluding the Wharton School In¬ money for a growing economy,
where you can live and work as
and
at
the
same
time
provide liq¬
stitute, provided courses in man¬
uidity and ready markets for an you please, worship as you please,
agement.
The Municipal Committee work expanding investor population,
and do with as you please, and do
The IBA
many
of you hold for my
needs of
faced
the IBA really came into its own.
pent-up
making
doing about
our personal
responsibility to
widen the public knowledge of
our
free
enterprise system. To
educate them on how that system
works, what it stands for and how
it has produced the highest stand¬
ard
of
living in history. Eco¬
nomic education is essential, yet
neglected in our schools. Greater
is
What
these things?
I believe that it is
self-discipline.
Each of us indi¬ propaganda and we as Investment
vidually should continually reap¬ Bankers should meet this respon¬
peace.
Sound
familiar?
That, ladies
Likewise, the IBA became much praise our own firms to maintain sibility for the preservation' of our
and
gentlemen, was spoken by more active and effective in their our high standards.
system and our country.
I am confident the SEC investi¬
George B. Caldwell at a meeting programs. Real progress was made
Be proud of your heritage, of
in
of the IBA on Aug. 10, 1912.
many
fields.
Our education gation will be fair and impartial,
as
center; and
(2)
An
pression
to
experience,
and,
what is
more
dangerous, little care for
what they offer beyond their abil¬
ity to market and their immediate
profit."
of
e
every
wise
impor-
n
a
use
together
as
against an inviting field for the
many houses daily springing up
having little or no capital, like¬
nation:
ing
duty to
our
at hand to improve our se¬
Communism
the entire world.
tunity and responsibility of meet¬
ing
our
traditional
needs, the
laws
witnessing
strides.
most active part
courage
Incoming IBA President's quick look at the ups and downs of the
industry's history, approaching its 50th Anniversary in 1962, takes
of popula¬
Banker
store investor confidence
of America, and President of Bingham, Walter &
essential elements
tion growth and a rising standard
of living are not only with us but
But here again the IBA took on
new
By Curtis H. Bingham,* President-Elect, Investment Bankers
the
TORONTO
before
the
In¬
America,
1961.
10
»
The Commercial and Financial Chronicle
New Frontiersmen
Imperil
Our Freedom and Future
By George A. Newton,* Retiring President of the Investment
Bankers Association of America; and
Managing Partner of
G. H. Walker & Co., St. Louis, Mo.
there
ciations where
this
direction
is
on
expected
from
the
IBA financed
Welcome
the
the
to
50th
Investment
during which
a
a
investing and
too
free
to
swers
home.
a
ered
admit
to
the
Federal
getting
me
and I
a
will be enough work to do, and if
so,
encourage
whether
more
George A. Newton
maxi¬
performance by labor, man¬
agement and capital; where, in
mum
they
should
than 35 hours
a
week
spend
doing
it, those who penalize fellow asso¬
ciates
for
exceeding production
quotas, or strike to continue work
assignments
the long run,
tiersmen
obsolete; Fron¬
lethargy in leadership,
go
reluctant
to
the greatest rewards
to those who produce results.
The willingness of people to sur¬
render
their
authority
and
con¬
ity;
now
assume
Frontiersmen
responsibil¬
who
want
vestment guaranteed against
in¬
risk,
Thursday, December 28, 1961
two
brokers, so that makes
$180 million being handled in one
day, and this is the New York
Stock Exchange alone.
In addi¬
tion, there are the other ex¬
changes, and the over-the-counter
market, including municipal bonds
and governments. The magnitude
is staggering.
Perhaps it may be said the industry still suffers from shadows
of less noble days of years gone
by, but it is the present that
counts.
the
Even
Church
had
its
dark ages but reached the prom¬
ised land by continuing to preach
its
Gospel.
Is it not time we
preach ours that each
something about it?
This
noted
time
that
a
us
do
is
procedures in order for the Indus¬
try to better perform its functions.
Our
complete cooperation
ago,
the
made
talists
scapegoat
of
of
Street
Wall
push them
Two Continual Plagues
Fortunately, misconduct is sel¬
dom with us.
The industry's es¬
tablished code of business conduct
far beyond requirements of
No industry polices it¬
goes
the
law.
self
well.
But unfortunately,
what I think of, as two
girl friends of Misconduct, that
plague us continually—Misunder¬
standing
and
Misconception.
I
have been told it's quite compli¬
so
there are,
cated to live with
but to do
impossible.
an
integrity; that
so
Why
the
tion?
the
Here is the
of
and
not
industry, so their needs may
'with private capital,
financed
government
thousands
of
dole.
men
Here
and
women
are
of
various ages and experience han¬
in
and
seek
to apply
their
particular brand of fumigation to
the entire household.
However, a
happier thought is that the Secu¬
rities
and
Exchange Commission
has been the official body desig¬
nated to inquire into the Securi¬
ties Markets and their operation.
Although the Commission and the
Industry have disagreed on fre¬
dling, daily, millions of other peo¬
ple's dollars without default. For
quent
instance, take a three million share
day on the New
York
Stock
Exchange and assume a price of
$30 per share (I imagine it is
satisfactory solution.
the opportunity is welcomed
more)
you
of
move
vilifica¬
enterprise,
providing the thrifty with invest¬
ment opportunity to share in the
growth and wealth of their nation,
channeling these funds to business
be
members
industry that is
unjustified
backbone
and
free
Unjustified
Vilification?
this
associates
our
the industry, but the free enter¬
prise system as well.
Unfortu¬
nately, during the year we have
been
so
exposed, and now we
must
endure
crowded
quarters
and trying conditions as others
to war."
on
Bean <2?
one
so
With
have $90
million
in¬
every
see
if
occasions,
there
effort to reach
between
us
has been
mutually
Therefore,
a
there
is
to
piece of
.
I
paper.
would have worked
would have been
for half
and
So
I
in St.
the
went
to
partner
years,
suggested that it might be
idea
me
whole
Louis, who has been around
business for many
to
have
memorandum,
a
or
more
a
and
good
detailed
something
more
elaborate in the file to avoid "mis¬
understandings."
around
me
and
He put his
arm
said. "George,
we
just don't do business with people
who have
With
so
'misunderstandings'."
strict
a
code within the
industry, it must be that
"to
we
fail
get through" to the public—
Evans MacCormack & Co.
Los Angeles
Walter C. Gorey Co.
San Francisco
Stifel, Nicolaus & Company, Incorporated
St. Louis
Warner, Jennings, Mandel & Longstreth
Washington
a
in the act.
senior
our
Cleveland
Jones, Kreeger & Co.
on
sitting beside
Direct Wires to
Philadelphia
week
million the
a
firm would have been
Saunders, Stiver & Co.
Security Dealers Association
a
$10,000 contract and if it had been
$100,000 a partner of the firm
any¬
thing that can be done to improve
the
operation of the Securities
somewhat
was
concerned, coming from a law of¬
fice, where a flunky like myself
Chicago
Members New York
unmarried
with three is
ing,"
Burton J. Vincent & Co.
NEW YORK
be
can
expected to achieve this goal.
woman,
it was
industry of
seldom was she
year
ours
of
Markets and related practices and
.
Why
little nervous, at
times, depending on Frontiersmen
who worry about whether there
pow¬
incentive
in
ing government worries
tive and based
on
power
comments
at
initia¬
much
would be
by indi¬
vidual
more
Thus, I had thought originally,
on
these developments
appropriate, for a grasp¬
an¬
This is
system
to
future.
most
as
only
.
transactions
the
of
Most
.
respect to "misunderstand¬
I recall that when I first
violated that when it did occur it went to
St. Louis I was most im¬
others, and berated with fury, es¬
was
front-page news; that such pressed by our
pecially in election
years.
So
municipal man,
popular is the sport, even Khrush¬ publicity is long remembered and who would pick up the telephone
attributed
to
the
entire
industry; and say, "Yes, I'll take $250,000 of
chev
employed the technique,
when earlier this year, he is al¬ that, therefore, the conduct of each them. We will underwrite a half
of us must be impeccable for to act
a million
." and then he would
leged to have said, "The American
otherwise compromises not only
scribble a little something on a
people want peace, but the capi¬
Government constitutes the great¬
threat to our freedom and the
of
our
prob¬
lems, abroad
well
leads
me,
investment
the
est
these
the
it"
.
enterprise and
private capi¬
for
do
of the sessions
daily lives." As the list
examples
"droned"
our
nously
School
trol, in order to enjoy the opiate
atmosphere of "letting someone
else
asso¬
that here
banking in¬
dustry, the greatest living example
on the face of the earth of good
ethics in our daily lives; yet an
industry often maligned, monoto¬
special effort troublesome days ahead.
The
growing reliance on Washington
is alarming, for concentration of
...
emphasize
impor¬
of
Asso¬
It concludes
has been made
tance
Convention
Bankers
ciation of America.
one
it occurred to
on,
was
A big assist in
Wharton
ago,
attend
a
horrible
of
plagues of the public's misconceptions and misunderstanding
industry is recognized by Mr. Newton who hopes that investors
industry's high standards.
weeks
to
devoted to discussion of "eth¬
ics in
study of the investment banking industry.
as
several
two-day meeting of various
as head of the IBA.
Decrying governmental encroach¬
the economy, Mr. Newton finds singularly shocking and
will benefit from continuing efforts to educate them
old-
of
occasion
was
was
upon
more
Frontiersmen,
who survive because they are in¬
dustrious, courageous and self-
his retirement
from maintenance of the
are
type
ment
of the
tal,
fashioned
coincidence,
the twin
to
how, I find it considerably
comforting to think of the
others have been directing
attention to all this of late and by
financing competition from the Federal Com¬
munity Facilities Loan Program, education and electric power pro¬
posals, and municipal industrial revenue bonds. The need to correct
the
have
But
unnecessary government
year,
volved.
reliant.
Vigorous, candid defense of the investment banking industry against
"unjustified vilification" is made by Mr. Newton on the occasion of
of
criticize profits of others and ad¬
vocate government finance. Some¬
.
Volume 194
Number 6120
fail to get our
message across.
emphasis
So,
on
proper training
and
extreme care
personnel
.
The Commercial and Financial Chronicle
.
.
IBA's
Stand
of
Federal
on
Aid
to
Education
in
Willingness
of
at
an
11
interest rate of 3.945% were
rejected for Federal funds at in¬
the
Association
terest rates
less than the Federal
communicating with customers, so
they are sure to understand, needs
to
the attention of top
management.
In most cases of "misunderstand¬
national
stands
its
that the contest is not between al¬
ing," it
but to
may
be just "that" to
us,
the
customer, it is gener¬
"I've been 'ad," and that's
ally,
not what I.B.A. stands for.
make
eral
aid
Although
leged
ment
sion
of
case
"legalized bookie shops" as
are tempted to act by ru¬
mor
and tip, ignoring what the
I.B.A. advocates—"Investigate be¬
fore acting." Therefore, we must
be more informative, better in¬
people
more
this
ground work, the most sig¬
classroom
elementary
construction
and
showing there
as
immediate
need
for
classrooms and that
76,000
secondary
Government figures were
66,000
new
to
replace
ones now obsolete. I.B.A.
figures,
which
remain
unchallenged
to
date, point out that for the past
four' years, the number of ele¬
mentary and secondary classrooms
constructed by
municipalities,
av¬
and that in the month of
1961,
municipalities
bond
issue
dollars
January,
voted
for
more
construc¬
ation, was last year, in authoriz¬
ing the grant of $150,000 to the
a
study of the investment banking
industry. This culminated three
of
work, considering how
best might be assembled basic in¬
formation, facts and figures con¬
cerning the investment banking
industry.
The resulting
manu¬
script should be of great value to
the public and the Government.
elementary and secondary
classrooms, than in any other
month
in
history.
Government
figures supporting the balance of
the program become suspect as
well.
with
the
merit
these domestic programs,
us
what
measure on
makes of the mate¬
in
and in what
impact
the
on
1960 there was
mately
the customer.
Thus,
this
Federal
the
in
Welfare"
is
illus¬
trated
by the Association's posi¬
tion regarding industrial revenue
Association
to
a
the
at
its
your
best, facing
up
difficult question, considering
issue
on
reaching its
fundamentals,
conclusions
tuan
and
as
sum
dictates
demands
is
a
pol¬
icy and that increasing numbers
join
their
ranks;
neverthe¬
less, the Association has demon¬
with
the choice of part it wants to
play
type
of
financing,
intelligently,
faith.
and
Throughout history, wrong
seems
strong.
so
Yet, through
competition of expanding govern¬
ment electricity, with that of
pri¬
faith,
vately-owned,
right has turned to might!
taxpaying
public
utilities.
government
there
and
Where
Thus, in opposing such proposed
programs,
are so
many,
of
which
the Investment
as¬
have
faith in
strated
willingness to lead,
a
is
there
each
as
life
my
through,
I
but
sure
it's
classy
displayed
commitments,
large
women
ried.
made and carried
example,
scribbled
success;
note,
memo?
To
proven
day problems, but is vigorously
advocating the principles of free
enterprise and private capital
the
proven
weapons
of
as
strength
by reference
No
and
bring victory out
well!
struggle, if not mis¬
As
which
can
handled
or
abandoned for
some¬
thing else of passing fancy.
brief
tions, shame
which have made this nation
great,
of the current
or
who seek to discredit this
those
industry
isolated transac¬
their dirty minds!
industry handles
world
am
to
on
so
and
this
year
half-way
to
in
with
be
places
performance of the municipalities
and
so
private institutions has been
much,
so
their
we
men
are
with
"self" the final critic.
will achieve greater
and perhaps, with their
ability, to get
point, they will teach
their
across
us an
effec¬
tive way to "get through" to oth¬
the
ers
story
of
the
Investment
Banking Industry, and that I.B.A.
symbolizes "Integrity Before All."
a
relative
of
to the
newcomer
investment
banking.
I
grateful for the heritage and
♦An address by Mr. Newton before the
Convention
of
the
Investment
Association of America,
Holly¬
50th
Bankers
wood
Beach, Fla., Nov. 27, 1961.
outstanding?
Unnecessary government spend¬
ing, at its
been
seen
"shocking worst"
has
to
under the Federal Com¬
suit every
need
munity Facilities Loan Program,
as
presently
our concern
administered.
Here
private
cized
of Institutional
is not just with "gov¬
spending" but with "sub¬
capital.
The
now
publi¬
Charleston, W. Va. financ¬
ing, where bids by private capital
UNDERWRITERS
Investment
DISTRIBUTORS
Securities
Securities of the United States
and
BROKERS
Government and its Agencies
State, Municipal, Revenue and Housing
Securities
Service to
Unlisted
Trading Department..
Dealers
through
Syndicate Department...
v
The
FIRST BOSTON
Bonds, Preferred and Common Stocks
of
our:
Industrial, Public Utility and
Railroad
CORPORATION
Corporations
Bank Stocks
Casualty, Fire and Life Insurance
15 Broad St.
Boston
•
NEW YORK 5
Pittsburgh
•
Chicago
DIgby 4-1515
Philadelphia
Company Stocks
Bankers' Acceptances
LEE HIGGINSON
CORPORATION
NEW
YORK
BOSTON
Service
Since
1848
San Francisco
Cleveland
Securities of the International Bank for
CHICAGO
Reconstruction and Development
MEMBERS
New York and other
Investment
mar¬
inspiration and
Securities Markets
Shocking Government
Competition
ddnderwriter
Qjidtri&utor
^Dealer
Canadian Securities
Principal Stock Exchanges
External Dollar Securities
of
testimonial to the
to whom its
With
mouth,
a
best
character of this industry, are the
and
are
been
going
The greatest
more
other, than demon¬
out by word of
small,
as
get into trouble,
may
people
of
negative approach to modern-
have
with you. As I said about
Bankers Association, is not
guilty
a
the public
The proudest moments
repute.
daily by members of this
industry,
of
serve
can.
many other
Government funds,
for
ernment
this
work
responsibility
bility to
they
of education.
stitution" of government funds for
leaves to each member
"time" and
sume
if
supremacy,
the
strated the courage of its convic¬
in
will
man
oft
enterprise
individuals
of
forget their responsi¬
never
is
tions
and
free
multitude
very
brighter
ever
the
really be considered so
need, especially when the
a
of
few have
not followed the Association's
may
of
the
who
polished
con¬
regardless
recognized that
imagination
envision
this
great
possible financial loss to members.
It
but is a mortal conflict
between private capital and gov¬
ernment financing.
A struggle of similar nature and
equally disturbing, is the direct
by
but
gargan¬
that would be consumed
Compared
science and good judgment of the
majority
to
the general field
can
bonds, with disfavor. Here is
stomachs. This has been the sphere
few,
provided approxi¬
the
even
strained
"General
invest¬
struggle for
men's minds." Perhaps, but
first,
it is more important to fill men's
a
$1,300,000,000 more, but
only a four-year period.
for
specifically
to Association action in promoting
reference,
of
public in¬
is
Their insatiable appetite for dol¬
lars is vividly illustrated by the
respects, procedures and practices,
possibly, can be improved by our
respective firms, to better serve
Further
interests
"This
with
a
of
proximately $1,300,000,000; and, in
each of
rial
selfish
bankers and the
said,
shared
is their
budget.
developing better under¬
standing of the industry's func¬
depend in large
use
sickening
a
is
have
you
tarnished at times by
me,
Should not the entire ques¬
Coincident
tions and operations
effectively it may help the
investment banking industry, will
borrow,
reminder
tradition
tion of "need" be reviewed?
college housing program. Prior to
1950, this type of facility had not
been
financed
by the Federal
Government. In 1950, $300,000,000
was provided for a five-year
pe¬
riod. In 1955 there was provided
for the next five-year period, ap¬
How
as
itself, could
ideologies, the strug¬
gle is fundamentally economic. It
terest,
an
additional
an
required
were
was
tion of
nificant step taken by the associ¬
undertake
of
gram
pro¬
eraged better than 69,000 per year
ar¬
ticulate about this great industry
and free enterprise.
years
of
"insufficient need," using
on
reported
to
invasion
its example the proposed
as
dustry is to the economy, the func¬
tions it performs, or the
signifi¬
cant part it plays in one's
daily
life. Too often, it is viewed akin
School
education.
Federal
schools.
Wharton
to
"issues of emotion" and based its
to
Government
members
shared
with
a
multitude of others the apprehen¬
for
As
on
many
how essential the investment in¬
and
known
issues was evidenced by
vigorous stand opposing Fed¬
Misconception of the investment
banking industry and its objec¬
tives is widespread.
Few realize
ourselves,
position
field, the Association avoided the
Remedying the Public's
Misconception
formed
its
Regardless of talk about social
and political
d/ftreatment
dfecwrUieA
The Commercial and Financial Chronicle
12
Raising the Standards of
The Securities Business
By William L. Cary,* Chairman, Securities and Exchange
Commission, Washington, D. C.
Investment bankers' orientation
expectation
of,
on
the SEC's
industry sketches
the
include
questions concerning:
broker-dealers and salesmen
of
the
to
areas
and branch office
distribution
and
of
use
that ethical standards must move
quality of
and
(3) American Stock and
exchanges' operations and problems; and (4) certain patterns,
General theme of
Cary's address dwells on ethics and professionalism, and the
industry is asked to share fully with the SEC the responsibility for
Ours is
newly constituted Com¬
Four
Commissioners
a
mission.
have been appointed in
1961, and
Under these circum¬
in 1960.
one
I am
stances,
invest¬
sure
bankers
ment
might
seek
integral
segment
of
American
Personally, having spent my
life in the practice and teaching
of corporate law, with an address
at No. 1 Wall Street, I would find
it hard suddenly to regard all my
past associations with rancor.
life.
Secondly, investment bankers
the responsible leaders in the
industry who — happily — are
evolving the standards of a true
notion
some
Mr. Cary does
delaying the Commission's work during the investigation.
not propose
are
of
our
of
view.
might
point
say
I
that
profession.
We may have occa¬
sional differences in point of view.
back¬
our
grounds
are
varied. One of
us
is
er
form¬
United
a
But
in
that
we
same
can
States Senator
of
committee
and
firmly believe
aiming for the
that
cooperation
and should be anticipated.
believe
we
in
strong
they stand. It is commonplace
as
William L. Cary
of
to note that this is an era of eco¬
Banking
the
ends,
are
enforcement of the securities laws
Sub¬
the
both
Thirdly,
and Chairman
I
essence
"good times."
The Wall
Currency Committee which
Street Journal, with which some
jurisdiction over the SEC; two
are
outstanding past members of may be remotely familiar, had a
the Commission's staff; the fourth story about some Southern Pacific
nomic
and
has
was
experience
heavy
finance.
and
lawyer with
in
corporate
practicing
a
I
am
a
former professor
In
wire out to
there
a
have
a
following a
box car and finding
hobo
sleeping under
an
indeed
Times
blanket.
electric
part-time practitioner.
detectives
Railroad
19th Centuary
railroad
buccaneer: "Why buy the shares,
if
we
can
buy the directors."
Thanks in substantial part to the
securities laws—accounting rules,
short-swing trading, underwriting practices,
maintaining and raising the standards of conduct.
to
uted
trading pattern of such things as determinants
premium over offering price;
our
when even pan¬
not totally impecu¬
changed
a
I
position is not anti- fraudulent and manipulative prac¬
Responsible members of
Wall Street or any other street. tices.
clear that our
of view is doctri¬
the
industry, I believe, recognize
undiscriminating
irresponsible.
The financial
the
potential problems now pres¬
Such
a
totally
naire,
and
centers
deed
them
point
of
this
the
of
all
country,
world,
elements
and in¬
ent in
for
have within
and
Over
an
are
with
agree
calls
securities markets and
our
and
me
over
climate
that the
vigorous
enforcement.
again
in
New
can
do
must
and
world where all values
a
being
are
questioned,
lest
we
of
our
deteriorate
to
adversary.
This then is competi¬
tion
of
the
level
kind
another
the
in
—
Incorporated
1845
ESTABLISHED
in
as
economic
make
How
accountants
many
and
an¬
alysts would like to return to the
Exchange
•
*
"
'.
■
'
'
/
410 PARK AVE., NEW
YORK
standards as well?
too, can, and should be,
dynamic.
As a practical as well
as a theoretical matter, the basic
provement in
Ethics
principle
underlying
securities
regulation is that
of fiduciary
responsibility.
Mr. Chief Justice
Stone—himself a corporate law¬
than
More
a
that
law
was
its
ing
a
equity
reception to
the common
century ago
one
outset, let
all
and
that
on
proce¬
me assure
this
is
not
LONDON
the part of broker-dealers and
on
their
be,
salesmen
and
can,
should
keystone.
our
Certain
factors
deterioration
lead
may
standards
of
marketing area. I cite by
illustration the following:
Part-time
(1)
operate
may
to
in
way
salesmen,
from
a
the
of
who
door-to-door
factors
erode
in
and
of
standards.
themselves will
Part-time
sales¬
a
that
believe
can
man
Commission.
wait
1963
in
for
if
We shall not sit and
the
report
weaknesses
our
in
come
January
to light
administration of
own
ex¬
isting laws
or in current industry
practice. There is something anti-
climatic
tracted
action
sion
about
study
until
and
where
awaiting a pro¬
and
delaying all
ultimate
its
digestion.
the
need
of
submis¬
Therefore,
change is
demonstrated, action will be taken
as
soon
as
possible
through
an
dation
.
and
very
at
Interestingly
stake.
only
a
few
Marxist
days
philosopher
attention
that
agd
the
his
of
strongest
enough,
a
to
capitalistic
world
of freedom
of the
and
and
argued
exist
that
within
system.
more
a
is the
of
it
should
socialist
in
that
market
jurisdiction
ter
over-the-
and
over
the
poses
encom¬
regulatory
issuers. The lat¬
problem
of
the
extent to which reporting require¬
ments,
regulation,
and
insider
trading
proxy
restrictions
should
on
be
applicable
-
on
secu¬
depends to
great
integrity
their
salesmen
of
who
a
knowledgeability
broker
salesmen.
have
It
-
who
advise
dealers
the
is
immediate
proper
customers
avoid
the
on
selection of securities.
is they who must fulfill the
be
to know their customers imposed
conclusion
investors
in
protected by the
same type of
governing listed securi¬
measures
ties. I believe informed judgment
is the basis of a free and respon¬
sive
securities
stockholders,
market
that
and
investors,
and
se¬
curities analysts
must have cur¬
rent
information
of
material
events
able
affecting
to
make
a
to be
company
intelligent
invest¬
ment decisions. Information about
an
issuer should not be sealed off
once
a
company has offered its
securities
to
the
public.
Nor
should
it
be
limited
to
officers,
directors, and controlling
persons,
that class denominated
insiders.
Beyond
other
as
disclosure
questions
to
there
are
consider.
For
example, should not the ethic of
the
office
impose restrictions
short-swing
on
having
the
trading
insiders
listed
as
in
is
on
im¬
now
companies
securities?
argument
Again,
advanced
that
broker-dealers must both be rep¬
resented
on
the board of directors
and maintain
pany's
out
stock.
whether
soundly
It studies
duty
the
principle,
over-the-counter securities should
posed
and informed
the
to
in
exam¬
concept contact with the public. It is they
individual. He
Marxist
market
extent
people
against communism today in the
of the areas which the
An orderly
propaganda
own
some
Commission contemplates
ining in this study.
Polish rities
brought
the
both distribution and trading
pass
that,
econ¬
system
of
counter market. This will
difficult
.
our
area of inquiry
study will be an
market
terim
upon
that
the
examination
the
can
peril;
in
-
a business foun¬
Study Will Be Wide in Scope
permanently endure
The study will be broad and
without some loyalty to that prin¬
inclusive in scope. Breadth of ap¬
ciple
."
proach is clearly the dictate and
Laws are often enacted to rem¬
intention
of
the Congress.
As
edy the abuses of the fringe ele¬ Senator
Williams of New Jersey
ments of society—in our case the
said on the Senate floor: "It is
ethically marginal securities intended that this
study and in¬
operator.
To avoid increasing
vestigation
be
wide
in
scope;
regulation,
investment
bankers otherwise the
resulting informa¬
share with us the responsibility
tion will not enable Congress to
for maintaining
and indeed for examine the broad
spectrum of
raising standards of conduct.
the
securities
industry."
The
While we are enjoying this cur¬
Commission has already been de¬
rent prosperity, we must recog¬
veloping areas of inquiry.
Lines
nize, as the President has pointed have not been
rigidly fixed as
out, that we are destined to live yet, but we do have some defi¬
out most, if not all, of our life¬ nite ideas on subject matter,
I
should like at this point to go
time
in
uncertainty,
challenge
built
omy
Over-the-Counter Market
A second broad
to issuers
our rules or early
whose securities are traded in the
legislative proposals.
over
the
counter market. This
Turning now to substance, let
me
point out this is the first problem has already been exten¬
major study of securities prac¬ sively analyzed and we do not
intend to retrace our steps. On
tices and the market in 30 years.
Much has happened in that in¬ the basis of prior studies, it is
amendment of
in terms of the growth of
markets, proliferation in stock
ownership, and changes in dis¬
not slow to follow in giv¬
tribution and selling methods. The
recognition. No thinking time
is ripe for a new appraisal.
hospitable
principle and
gave
the
NEWARK
necessary standards by adequate
supervision. Responsible conduct
men
may be the most competent
accounting rules of the 20's? And
publicity venture. There will be and ethical individuals. Profes¬
how many people in the utility
no midget perched upon anyone's
sionalism, however, is harder to
industry—comparing the jigsaw
lap. This study will be responsi¬ develop on a
part-time basis.
of a utility empire then with their
ble, as evidenced by the choice
The Commission is encouraged
corporate structures today—would
of its director—a highly responsi¬
feel that their industry is worse
by the efforts of the industry to
ble lawyer. Anyone who has seen
off? Some would say in fact that
improve the standards of sales¬
Milton
H.
Cohen
in
action
is
the Holding
men
and broker-dealers—by any
Company Act may aware of
his broad grasp of the
well have saved them from wider
steps taken to inject a higher
securities field, both as a gov¬
governmental ownership.
degree of professionalism into the
ernmental
official
and
active
This does not mean, however,
securities business.
We welcome
private practitioner. At the same
that
the establishment of more rigor¬
everyone
in the financial
time, even though the investiga¬
ous
tests
as
a
condition to
community is benevolent.
Fur¬ tion
will not be flamboyant, I
thermore, should we adopt an
registration of salesmen.
In
would add that in
our
opinion
attitude of satisfaction with the
furtherance of this goal of pro¬
some
public hearings should in
status quo? In the past 6 months
fessionalism, we expect to deter¬
all probability be held.
I have had a chance to observe
mine what might be developed to
Finally, with respect to proce¬
the resourcefulness of the secu¬
improve the training, sense of
dure, I want to emphasize that
rities
industry in adopting new
this study will not be divorced responsibility, and general quality
forms of financing. Why is there
of broker-dealers and salesmen
from the continuing work of the
not
room
for
growth and im¬
with all its virtues of freedom is
61 WALL STREET, NEW YORK
broker-dealers, employing
these salesmen, who must bear a
responsibility of maintaining the
systems.
few comments
a
dure. At the
over
Members New York Stock
It
the
ethics of business conduct
/
Clark, Dodge & Co.
is
as well
and be remote from experienced
Here is supervisors.
an
area
in
which
complacency
(2) The growth of branch of¬
may not be permitted to flourish fices which
may lead again to the
in
the glow of economic wellpotential
separation of salesmen
disclosure
standards, and prin¬
being.
from supervisory officials.
ciples of fair dealing have devel¬
oped almost by a process of ac¬ Forthcoming Securities Markets'
(3) The growth of the base of
cretion.
While
in
law
school
stock ownership which has un¬
Study
during the early 30's I remember
doubtedly injected into the mar¬
Now, how can we carry these
the overwhelming fears expressed
ket less experienced investors and
general principles concretely over
over the 1933, 1934 and the
1935 to the
speculators.
study of the securities mar¬
Acts. I wonder how many today
kets
(4) The sheer volume of activ¬
which
Congress has com¬
are still opposed to the disclosure
missioned us to undertake? Be¬ ity on the market.
philosophy—which is now gain¬ fore
going to substance, let me
I do not say that any of these
ing
ground
on
the Continent?
venture that I handlers are
speak
for
my
colleagues;
my nious.
views, though, are in no way
The
crescendo
of registration yer—phrased this thought some
33 years ago:
binding upon them. We function as
statements with which the Com¬
a
true
Commission,
with five
"I venture to assert that when
mission
is
daily
confronted
is
voters, always independent, oc¬
the history of the financial era
casionally differing from one an¬ testimony to the lively state of which has just drawn to a close
other, but at the same time oper¬ the underwriting business.
This comes to be written, most of its
ating in a general atmosphere of
mistakes and its major faults will
output has been coupled with
harmony and respect.
be ascribed to the failure to ob¬
very
active
market conditions.
serve the fiduciary principle, the
SEC's Position
These factors create a greater op¬
precept as old as holy writ, that
First of all, let me make it portunity for the development of 'a man cannot serve two masters.'
general,
We
by exchange and NASD rules.
utmost to raise ethical stand¬
ards in
finally, I believe
upward. Today anyone would be
shocked with a comment attrib¬
part-time salesmen
policies and practices of investment companies.
Mr.
be
They
multiplication; (2) over-the-counter market trading
and "after-market"
other
professionalism
Fourth and
encompassing extending listed disclosure require¬
ments to counter issues,
of substantial
(1)
freedom.
Raising Ethical Standards
relationship with, and
some
besides the
York, before I came down to Freedom Requires Responsibility
Not Abuse
Washington, I had eminent lead¬
ers
in
the
investment
banking
At
the
same
time
we
must
industry take me aside and tell likewise recognize that freedom
me
that certain corrections are can survive only if coupled with
needed. I emphasize that action, responsibility. The public inter¬
both legislative and enforcement, est cannot permit abuse to
be¬
will be selective, and not a broad¬ come rampant under the guise of
side.
probed by forthcoming full study of the securities industry.
Thursday, December 28, 1961
.
,
.
some
market in
a
Our
this
based.
may
of
questions
the
be
a
com¬
job is -to find
argument
Thus
needed
more
is
further
to
settle
controversial
involving concrete
ap-
Volume
194
Number
6120
.
.
.
The
plication of the provisions of the
been
Exchange Act.
concern
shall
also
underwriting
review
practices.
noted with interest the
of
use
various
forms
current
We
special
underwriting
compensation, such
stock and options. \ We
cheap
as
have
in
seen
ordinarily
cash
few
a
high
extra¬
cases
commissions
in
stock and wonder whether
or
subject
principles of trade. Also, in
instances—but a few is too
few
a
many
have noted public
offerings
securities
of
companies
—we
the
of
whose
the
A
on
and
off
the
ex¬
Another
for
very
strictions
curities.
on
the
the
There
numerous
in
important
area
inquiry deals with credit
re¬
purchase of
present
gaps and inconsistencies
asked
that
me
president what his
a
nany
told
made,
and
the
he
certain
be
directly involved in this aspect
market
of
the
selling practices of mutual
salesmen.
Independent
of
At
margin requirements. We
make
is
rational
to
a
or
for
basis
necessary
the
credit
problem
the
I
it
has
economy.
should
that
in
not
they
sure
the
like
to
Commis¬
on
business.
impact of
the
on
I
clear
does
am
growing
outset
In
attention
ways
the
study
inevi¬
of
course
we: shall
doing
of
the
analyze
fund
this
their investment
advisers, brokers
conclusion,
I
desire of the Commission for
mutual
fund
as
transactions
an
advisory fees; joint
between
the
invest¬
certain
practices,
and
policies
in
company
patterns,
investment
warrant close
area
amination.
the
ex¬
and other practices such
as
"reciprocal business." The Invest¬
ment
Company Size Study under¬
taken at the request of the Com¬
50-odd
law
suits
mission by the Wharton School of
tion
on
facing
all
the
We
us.
require
from
far
♦An
50th
address
Annual
by
Mr.
infor¬
more
Should
not
this
type
of
:| 111 I 11|
A\f sf 11
i1M
s g i 5 ?:!
\
Xv
.w"'
for
't i:
the
industry? Does anything less satis¬
fy the objectives of the Securities
Act and
the
Act? Just
Securities
,Av.;
Vx>»-v"
Exchange
i
must "know your
you not "know
as you
'
nim
?•
|
if ^,,jC*■ •••■"**^
customer," should
issuer"?
your
Premium Over Offering Price
In connection with
of
the
shall study in
tion
of
process,
we
Jiw
depth the distribu¬
"after
and
pattern
analysis
our
distribution
market"
issues
trading
offered
to
the
public for the first time. Particu¬
,iy.W,',v''
lar attention will be paid to issues
in which the first trading price
of
security represents a substan¬
premium over its public of¬
fering price. The staff will attempt
a
tial
to
determine
of
this
what
is
the
cause
premium, whether it re¬
sults wholly from supply and de¬
mand
or
from
practices which
\ LjotwwJvww*' \
$ fiv.VVW.MA • «•«"** *++*
.V
intended to generate a certain
are
type of market reaction. Among
the practices which will be ana¬
lyzed are those whose effect might
I.W/.WA'
be to restrict
artificially the float¬
ing supply of stock in an initial
distribution, such
siders
who
not
agree
given
sales to in¬
as
preferred
or
to
period
customers
resell
and
for
sales
a
to
discretionary accounts where the
customer
has
knowledge
U \
immediate
no
of
the
Will
transaction.
Furthermore, after-market activi¬
ties which might tend to
maintain
or
inflate prices will be reviewed.
include
the
requirement
These
that
a
customer who buys at the
offering price purchase additional
shares
at
higher prices in the
after
market; open
by insiders,
market pur¬
underwriters
the
purpose
of
chases
and
others
for
maintaining
of
use
to
give
in
the
«
'
'
'•
i
f}:: J •' 3
. • If. i
t^.V^/>y;VAV.VW.y.;
ma*••••
OV.V.-.V.V.V.vav.'.;.,^
market; and the
"pink sheets"
a
bids
\ <
the
appearance
of
after
market activity. The Commission
will have to determine which of
the
foregoing activities actually
occurring with frequency and
are
the
as
extent
YA i
WA"MVMWWW
.
,J
c
:
,r
*.
3
i
::
3
lAri
to which
fraudulent
they operate
deceptive prac¬
or
tices.
ASE
Other Exchange
Questions
and
,V.VW/mWWWrJwflOO»A'i'
.YAVrti. *
The
staff
of the
•
Commission is
nearing completion of its investi¬
gation
of
the
rules,
policies
and
procedures of the American Stock
Exchange relating to the conduct
of specialists and
It is
other members.
anticipated that the staff
re¬
port in that investigation will be
coordinated
with
a
general
FIRST
in¬
NATIONAL
CITY
BANK
quiry into exchange problems. In
this area, it
is anticipated that
will take
new
sive
ence
a
and
we
comprehen¬
look, in light of past experi¬
and
certain
present
basic
conditions,
at
questions that have
Bond
Dept.
*
Head Office: 55 Wall St., N.Y. 15
»
Teletype: Municipal Dept. NY 1-708; Government Dept. NY 1-5824
Member Federal
Deposit^ Insurance Corporation
the
of
Hollywood, Fla., Nov. 28, 1961.
■"VVv-^
careful
inquiry be the standard
of
Association
"X,
prior to
its securities than
will be presented in a
prospectus.
underwriting
common
Cary before
Convention
Bankers
was
issuer
an
a
securities business.
a public
distribu¬
securities? I know that
mation
con¬
goal—to raise the standards of the
participates in
many
and
problems jointly
have
a share. What are the
respon¬
sibilities of the underwriter who
of
re-
anticipation
tinuing and full industry coopera¬
ment
The
the
to
by underwriters and dealers
in investment
the
$2
tion
want
tion
to
or
com-
reply
In
in
program
proper
of mutual funds,
that
securities.
view towards formu¬
a
sound
a
impair the effective and
lend¬
of
study all pertinent informa¬
emphasize
money
was
and
tion with
underwriters; the participa¬
sons;
allegedly
useful
provide
and
any
vestment. We do, however, believe
which
should
investment company area.
company relations with
insolvency
concern
and
of
data. The Commission will review
desire
question the
factoring
tion
University
is nearing comple¬
vestment
ment company and affiliated per¬
large
the
lating
important medium for public in¬
a
of
Pennsylvania
study, the Commission itself has
been undertaking a review of in¬
gained prominence because of the
of
Finance
way
operation
allowing these to continue. At
present
industry,
the
sion
to customers for the purchase
and
tably
attempt to determine if there
distinguished
engineer
focus
shall
ing substantial amounts of
chairman
affiliates
the mutual fund
at
are
involving mutual funds and their
Finally, I should like to com¬
ment briefly on investment com¬
panies. Although some may not
recognize
se¬
only business seems to be
manufacture of its securities.
board
Mutual Fund Examination
the
as
the
taking of such compensation is
consistent with just and
equitable
of
continuing
specialist's
trading by members, block
such
change, and the like.
have
increasing
of
the
role,
distributions
Underwriting Practices
We
Commercial and Financial Chronicle
the
Invest¬
America,
14
Europe
Shifting Gears in
By Norman J. Alexander,* General Manager, James Richardson &
Sons, Winnipeg, Canada; and Chairman of the Canadian Committee
of Investment Bankers Association of America.
Refusing to
along with his countrymen's dark mood
go
Mr. Alexander submits Canada can cope
avers
of doubt,
only themselves to blame for "overbuying
would
I
certain
like
to
comment
features
of
the
upon
Canadian
economy and what is being done
about them. The disappointingly
slow growth
in Canada in
critical
not
do not in any way share
mood of doubt which is
that
contrast¬
1960
ed
afflicts
all
spread
op-
timism
ex¬
Cana¬
dian thinking.
Stout of Heart
a
to
knotty prob¬
lems. Introspection, which can be
an unhealthy attitude in both na¬
tions
and
individuals,
will in
Canada have to give way to criti¬
cal analysis, constructive thinking
and courageous concerted plan¬
ning and leadership.
the
prognostica¬
tions made for
1961. There is
question
that
with
Nation
strength and human
meet and
cautious early
now
a
stout heart. We have the economic
pressed at the
beginning
of
that year and
may well have
dictated
is
Canada
Norman J. Alexander
a
The
too much attention.
Maybe the upturn has been
largely masked by the interest
that is directed to the "burning
issues of the day" in the form of
unemployment, the discount on
the Canadian dollar and the build¬
ing of exports in the face of Great
proposed entry in the
Britain's
Common Market.
resources
our
nature
Canada's
business upturn is well in progress
in Canada, but it has not attracted
solve
and
extent
of
from the
first,
largely
furs, has led to the development
of an economy that has been de¬
pendent on International markets
and never more so than today.
when
resources
exports
our
We had
wanted
so
were
much that the world
there
and
was
so
half
much
the
decade has
Nevertheless, Canadians indi¬ been direct investment in produc¬
vidually
are
much
concerned tive resources which obviously has
about Canada's economic feature been
good for Canada and does
but collective planning and action not leave her vulnerable to the
in a purposive sense has been
flight of capital or difficulties in
regrettably slow in developing.
servicing it.
While
economic
I
have
Canada
to
has
admit
that
arrived
at
past
Today Canada
competition
of
is
a
facing
the
rehabilitated
of basic resource prod¬
such, however, we have
become
far
too
dependent
on
transportation and foreign mar¬
kets to support dynamic industry
growth such as that seen in the
As
of the world to
ing of
there
in
Secondary
far greater export trade
many difficult bridges
a
domestic affairs that must
our
Not
Develop
manner
a
be crossed to achieve this
United States.
Must
in
are
the
least
goal.
these
of
Industries
If we have
trapped ourselves by
overbuying the arguments of the
Paley Reporth, we have only our¬
selves to
blame. The long and
limited
the
To
home
the
accompanying curtailment of
eco¬
market
nomic efficiency
^
Canada
must
pattern.
with
observer
to be
seem
lacking
they treat
Because
largely unrelated individual
aspects
of
short of it is that Canada, in order
Export Agency Created by the
maintain the high standard
Government
to
of
living of which we are proud is
going to have to develop our sec¬
ondary industries to a point where
they too can compete domesti¬
cally and in a very substantial
manner
the world market.
on
Canadian
while
for
secondary
industry,
most part techni¬
the
limited
the
home
market.
It
has, in varying degrees, been pro¬
tected by tariffs but it has been
difficult to make headway against
the mass production methods and
wage
scales of other countries.
The premium which has prevailed
on
the Canadian dollar for
a num¬
of
our
economy.
If Canadian
can
be
i
secondary industry
into
the
good
moved
growth category, there is little
question that we will have taken
the long step toward solving the
problems of unemployment which
is threatening to assume ominous
proportions.
come
Constitutional
xTrade
nessmen;
now
with
at
Canadian
Canadians individually are
about
much
economic
our
prospects, and great pressure is
being brought to bear! upon
now
Government
Federal
for
review and overhaul of our
nomic
practices,
and
a
eco¬
estab¬
policies
designed to meet the demands of
bold
of
the
new
"Operation Cleanup"
busi¬
commissions
are
the order of the day.
would
I
want
not
to
leave
members of the IBA with the im¬
Corporation of Canada Ltd. to
finance export sales for less than
pression that Canada has started
on
a
desperate "Bootstraps" re¬
covery. I would suggest that the
steps
being
taken
might
be
labelled "Operation Cleanup." It
is action that is being taken to
five-year
adjust
Under the aegis of the govern¬
ment,
the
Canadian
chartered
banks formed the Export Finance
while the govern¬
paper
ment would take financing beyond
that term.
A National
Productivity Council
has been established by the gov¬
ernment. The Industrial Develop¬
Bank
ment
has
been
provided
with additional financing capacity.
In October 24 government trade
commissions
started
out
visit
to
markets. Tax concessions
overseas
have
been
made
to
promote in¬
creased research
by industry and
currently the government is re¬
ported to be considering establish¬
ing ^ fund to underwrite industrial
the Canadian
on
long been
handicap
a
taken
to
eliminate
was
of the flow
on
of
excessive
an
this
largely the
capital into
scale.
changes in the withholding
tax rates made in the Baby Budget
of December, 1960, were not de¬
signed to repel foreign capital
from Canada but rather to
eign capital that
remove
attract
for¬
longer
necessary. Foreign capital is still
needed
made
in
Canada
welcome
bonus
were
for
coming
making this
When
Minister
will
there
to
is
of
Finance
duced other
measures
also
Actually "Operation Cleanup"
being successful. It now looks
as if, for the first time in a num¬
ber of years Canada will have a
surplus in her merchandise trade.
There
the
intro¬
in( regard to
Canadian Dollar's Value
development
in
the dollar
in the
was
effects of "Op¬
Cleanup" however, are
likely
to
subside
relatively
quickly. It must be considered as
a necessary but temporary meas¬
ure to give time to position our¬
selves for "Opeartion On Course."
It is not possible at this time to
detail
the
ingredients
of
this
beneficial
cominb operation. To be success¬
ful, however, it must embody:
(1) Courageous, determined and
responsible leadership, at the
highest level of authority.
Co-operation and co-ordina¬
(2)
tion of effort between manage¬
ment and labor
connection
external
fund
value
dollar.
This
versal
of
policy.
government
an
of
was
had
to
to
with
the
a
operate
lower
the
Canadian
complete
rer
Previously the
claimed
that
undertaking would be far
Exchange fund figures for July
September
the two sides
government.
is
It
said
often
hardship
or
that
adversity
maturity.
hastens
Maybe that is what has happened
in Canada.
had
Certainly
have not
we
hardships but the modest set
backs
recessions
or
years
minds
our
during
the
contrast sharply in
with
the
relatively
and rapid growth of the first
ten post war years.
easy
We have
and
now
suddenly
we
difficulty in adjusting
affairs
tic
to
sibilities that
stature.
meet
come
short
In
selves
but
rapidly
a
with
our
the
domes¬
respon¬
with this new
we
to learn to live not
of age
come
experiencing
are
having
are
only with our¬
other
changing
nations
but
in
mature
old world.
top costly.
to
as
of industry and
the announcement
intended
exchange
such
dramatic
June, 1961 Budget that the
government
its
most
in
eration
past five
the
reduction
a
no
domestic investment by Canadians.
Probably
been
has
imports of capital. The GNP is
rising, corporation profits are be¬
ginning to improve and with the
increase
in
production,
unem¬
ployment is decreasing.
be
investment companies and pension
plans that would promote more
The
up
is
Canada.
change
cleaning
—
of which is
preparation
for
the
much greater and more important
"Operation On Course."
yard—all
necessary
no
and
but
affairs
our
own
our
The
premium
special incentives to
Street, New York 4, N. Y.
complications,
were
The
BROTHERS
Canadian
propriate jurisprudence arid can¬
not be permitted to stand in the
way.
As mentioned previously;
recalled to Ottawa and held long
conferences
of
however, can be overcome by ap¬
the future.
Canada
■
jungles
political
began a determined drive for ex¬
port
business.
Trade
commis¬
result
€MM
only fair to say in defense that
constructive proposals be¬
trapped and
die in the
many
lishment
been
0
a
the beginning of 1961, through its
Trade and Commerce Department
handicap which
Ml
than
the
Government
Canadian
sioners in various countries
cally first rate, has been geared
to
The
our
to become
seem
concerned
to Canadian exporters and domes¬
tic secondary industry.
Steps have
independent
constitutional federalism.
with
The
One William
187
this catalogue of moves made by
the Federal Government to help
the
is
generation of an export capability
by secondary industry which in
the past has been geared to the
.
dollar has
LEHMAN
Gov¬
purchase
deny the accuracy of the observa¬
tion but at the same time it is
world
managed
that has permitted the generation
of sufficient business with the rest
research.
ii
Canadian
to
million U. S. dollars.
in
short, Canada's affairs have
been
had
tion to the problems is the build¬
on
a
prising that Canada's secondary
industry has not been featured
amongst the real growth segments
in
In
the
and
ucts.
and
We
are
passing, may I point out that
the
foreign investment in
Canada
ernment
not
as
Upward pressure however
developed in a substantial way in
and the
the labor market.
discount
a
lars.
absorption of labor by secondary
industry has not been sufficient
to take up the slack in the labor
force created by the normal popu¬
lation increases plus the crop of
"war babies" that is now reaching
actually employing less
to
actually lost U. S. dol¬
supplier
can
successfully
and
in
us
fund
October
can
ber of years has not helped. Under
the circumstances it is not sur¬
outside help eager to assist
developing these resources.
In
industries
today employ few more than they
did a decade ago.
Agriculture is
down"
"talked
the
support continua¬
markets
feature
a
much
too
and
industries
resource
forestry, mining, and oil
as
tion of her present high standard
of living. While the obvious solu¬
the dark
sharply
with the wide-
no
Course."
point in history, I am
prepared to concede that this
critical point is dangerous and I
a
resource
competing
are
up" to help the Canadian dollar and trade, and outlines what should
Canada's
such
Thursday, December 28, 1961
.
.
.
economy,
they
palliatives rather
panacea or even a collec¬
tion of remedies. It is difficult to
world
cessful temporary steps pursued in what he calls "Operations Clean¬
on
Asia
an
where in the world.
must develop its secondary industries to
be competitive at home and abroad. Further, he commends the suc¬
permanent "Operation
and
are
efficiency as high as
that of comparable industries any¬
and declares the economy
more
Africa
striving lustily
for their place in the sun.
Of course, we are by no means
alone in fighting for markets but
there are certain aspects of the
Canadian economy that make the
task very difficult.
*
claim
the Paley Report,"
...
of
elsewhere that
Canada's
though still rela¬
—
Moreover, Mr. Alexander admits Canadians have
be done for the
nations
with her critical problems.
the business upturn is well in progress
tively unnoticed.
Japan
with
their
plant and lower wage
scale
production. We
are
also
competing with underdeveloped
and
modern
The Canadian Economy
He
Chronicle
The Commercial and Financial
indicate
that
the
*
Remarks
50th
ment
Canadian dollar had largely been
Annual
of Mr. Alexander before the
Convention
Bankers
of
Association
Hollywood Beach, Fla.
the
of
Invest¬
America,
Volume
194
Number
6120
.
.
The Commercial and Financial Chronicle
.
15
significantly higher level of
Thy Neighbor's Dilemma
and incomes. But it isn't
at all easy. Aside from
being onetenth the size of the United
industrialist's frank-spoken
address
warns
not
us
to
be
payments deficit.
population would
our
lion
U. S.
from
mean
A. imbalance.
Mr.
free trade pact with
a
Lank opines no solution would
us or
result
terest
to
help his country, and adds that Canada would join
50-50 club—where trade
to
most
I felt
highly honored when I was
asked to address this gathering of
Investment Bankers—that is, until
it was brought to my
attention
and
community
generation
dians, nurtured
what Aristotle
earlier
Twentieth
dismissed
you
with these
"The
words:
hated
most
sort
statesman
the
is
(that)
reason,
dians
usury
Canada
which makes
self.
.
For
.
Herbert H. Lank
money was
intended to be used in
but
increase
to
not
this
And
term
at
interest.
interest,
this is the most unnatural." How¬
We
Canadians seem to be regarded in
some
quarters of world opinion
with a similar j aundiced eye.
you
In
alone.
not
are
fact, things
are
not what they
used to be north of that undefend¬
ed
boundary about which a billion
speeches
have
been
made.
So
much has been said about Canada
that
might wonder if one
more speech is justified. Well, if
you
read
"Gourmet,"
you
see
every month that the humble egg
reappears in some new and novel
form in spite of the fact that eggs
have been staple diet for count¬
less centuries. And Canada, like
you
the egg,
in some
will continue to reappear
different way for a long
to
come.
Currently,
the
time
Canadian
situation
scrambled.
Aside
is
from
bit
a
the many
right in Canada,
there are many things wrong. But
there is nothing seriously wrong
things that
are
with Canada that Canadians can't
fix—and I have
to
tance
just
come
all this dis¬
suggest that they might
that
do
all
by
themselves,
in
co-operative
approach to
her
economic
difficulties
(and,
yes, to her economic aspirations)
would be
decidedly the better
path to follow, for all concerned.
a
wonder
steps
and
unless
Canadians
actively talking
about where they are going as a
country, whether they have been
going fast enough and what new
are
steps must be taken
rect
the
now
to
cor¬
of
past
errors and to help realize Canada's
potential. There exists a discon¬
consequences
different
on.
era
There is
and
pro¬
and
a
yet have
spirit of in¬
of introspection
and of
sober review, and this can be seen
in the many official studies being
undertaken of economic prospects
quiry,
and of
as
well
particular industry groups,
as
proposals
pleas and
forth by business
by the
put
many
rules
Nation
Last
the
and
ments.
They
of
to
ports
come
in the form of
products.
of Common
naturally
arises
success
of the European
Common Market.
There, in contrast
our
own
winter
out
of
11%
of
unemployed),
the
there
were
common
a
is
talk
in
influential
cles
of
the
EEC
there
as
derives
trade.
worth
total
a
is
from
ferment
and
surprised
NEW
YORK
Ithaca
•
PARK
one
if—as
I
Kingston
■
Auburn
Middletown
•
darker
canvas
is
areas
entrants
year,
William Blair 8C Company
Chicago, 111.
( Denver, Colorado Springs,
Company j Grand Junction, Pueblo,
ployment to
rate.
labor
more
But
1956,
(Nashvil e, Knoxvil e, Jackson,
ZATlrJ"'.: g*T
Chaplin, McGuiness 8C Co
Pittsburgh, Pa.
Chapman, Howe 8C Co..
We
force
if
our
foreign
have
5%
of
the
exports
the
same
U.
S.
and
on
current
St. Louis,
annual
we
to
direct
more
are
Syracuse
•
Hornell
Geneva
•
Utica
Watertown
•
•
Janney, Battles 8t
E.W.Clark, Inc.
A. G. Edwards
_
&Sons
Sunbury, York, Pa.; Baltimore,
Md.; Camden, Woodbury, N. J.
{Washington, D.C.;
\ Alexandria, Va.
_r
Beaver
Dam, Chippewa Falls, Green
Bay, Janesville, Kenosha,
Madison, New London, Racine,
Waukesha, Wausau, Wauwatosa, Wisconsin Rapids, Wise.
Loewi 8C Co., Inc.
Louisville, St. Matthews,
Bowling Green, Danville,
Lexington, Ky.
Lyons & Co
Mead, Miller 8C Co..
Piper, Jaffray & Hopwood.
Baltimore, Md.
Minneapolis, St.
Paul, Rochester,
Minn.; Fargo,
No. Dakota; Bill¬
ings, Great Falls,
r
o,
JCleveland, Shaker Square, Canton,
j Columbus, Toledo, Ohio
San Francisco,
Los Angeles,
{Berkeley, Beverly Hills. Fresno,
Tenn.
Chattanooga,
..
Mont.
n
Prescott 8C Co.
Sutro 8c Co
Elder 8c Co
Va.
'Milwaukee, Appleton,
W. L.
Lakeland, Naples, St. Petersburg,
Fla.; Belleville, Jacksonville,
Springfield, III.; Ames, Keokuk,
Iowa; Hutchinson, Salina, Topeka,
Wichita, Kan.; Lake Charles,
Shreveport, La.; Laurel, Miss.;
Bartlesville, Ponca City, Okla.;
Houston, Texas.
Cincinnati, Ohio
•
Philadelphia, Germantown, Beth'
lehem, Easton, Johnstown, Lan¬
caster, Norristown, Pittsburgh,
Johnston, Lemon 8C L.o
..
Clayton, Crestwood, Mo.;
•
Corporation of Virginia
Tuscaloosa, Ala.; Phoenix, Ariz.;
F
OREIGH
Ian Potter 8c Co
Paulo A.
Hayward, San Jose, Calif.
Bromberg
Sao Paulo, Brazil
a
..
.Montreal, Canada
A. E. Osier
PRIVATE
Providing immediate
access to
connections in
VZZZZZZZZZZZL
Company Limited.
.
.Toronto, Canada
Yamaichi Securities Co., Ltd....
Roldos S. A
Mercantil De Inversiones S. A.
greater
reach
C O R R E S P O H D EH T S
Melbourne, Australia
Greenshields 8C Co. Limited.
productive
to
CITY
•
Chicago, III.
if it is to develop
the
•
YORK
Elmira
WIRE
.
.
.
.
.
Tokyo, Japan
Montevideo, Uruguay
Caracas, Venezuela
SYSTEM
primary markets through Branch Offices and Correspondents and their
over
100 cities
throughout the United States and Canada
have
page
YORK 5, N. Y.
Jonesboro, Little Rock, Ark.;
believe
an
NEW
•
been
GNP.
imports
period
Continued
late
imports
usually
the
than
case
Since
and
achieve
will have
industries
that
commodity
exports
during
Hartford, Conn.
Company, Inc.
high unem¬
normal levels in
properly. What's more, I think
this goal is entirely attainable.
attention to
S.
than
more
fact
yours.
Canadian
Jackson, Miss.
was
double the
actually,
I
increase of 5%
in
U.
below
statistics,
,
current
Canada has to
of
simple
does
1920s,
own
( Colo.; Chicago, III.
The
in volume terms.
the
to
our
the
Hill & Co
Chicago, 111.
economic
1.7%.
Taking into account our
growing work force, productivity
per worker has remained
static
over
the past five years. If we
are merely to absorb the net new
reduce
the
Investment
Betts, Borland 8C Co
in the
growth.
country's
historic
growth, from 1920 to
per
American
CORRESPONDENTS
Anderson *
Dittmar &
3.75%
Canadian
the
Stroudsburg, Pa.
Cooley 8C Company
I
•
Canadian
the
on
of economic life in
it
virtue,
noting that in the
AVENUE,
STATE:
Productivity Static
of the
on
Tor\ Stock Exchange, American Stock Exchange
of
the
any
weighs
cir¬
hope—bold proposals result.
One
that
LONDON, ENGLAND
re-thinking of Canada's position
is urgently needed. In this respect,
be
than
fact
balance
Loeb, Rhoades & Co.
375
There is, in fact, sound statisti¬
not
the
trade
heavily
more
the bal¬
or
Such
on
deficit
cal evidence to indicate that basic
need
propor¬
Corporate and Municipal Securities
Boettcher 8c
in
S.
much
as
Canadian
States.
is
U.
Underwriters and Distributors of
a
inescapable fact that Canada is,
relatively speaking, much more
of an international trading nation
than is, for example, the United
Canada
this
to
economy
and
of this at home.
more
This
Add
NEW
of
sense
opinion, there is
Russia.
such
42 WALL STREET
work
our
there
con¬
position in
times worse
many
the
of
re¬
purpose toward achieving them is
yielding the desired results, and
the
average
Canadian
wishes
In my
can
and principal Commodity Exchanges
growth, ris¬
ing productivity and virtually no
unemployment. In the EEC, the
sober setting of objectives and the
of
of
won't dwell
up
Carl M.
record of accelerated
existence
Canada's
earn.
that
adverse
reward.
to
individuals
nor
con¬
Neither
by
10 years Canada has chalked
revenues
your
tionately.
the better" without due
it's
tax
that
justified.
trade looms much larger as a fact
more
last
and
fully
respect is
than
to
but
standards
are
the
obviously, has not been its
living
There
in the
when it
deficit balance ap¬
year
tinue for long to spend more than
unorthodox
ing
high
stage.
concern
last
feel
and
is
nations
pay¬
short, becoming weary of provid¬
jobs,
States
you
cern
they
I
skilled
for
this
seem
perilous
a
slogan that "Trading is virtuous—
ance
manu¬
are,
(where last
economy
had
we
force
the
to
some
for continuing concern.
Canadians have every sympathy
first lessons I
for imports." We
accepted
United
Now
grounds
problem
in
They
Market
markable
to
the
of
regard for the nature
process.
having about 75% of their im¬
factured
One
pay
have
questioning the wisdom
are
another
the
amounted
total.
running a
proaching $4 billion and there
learned outside the classroom was
this: "The purpose of exports is
Canadians feel they are get¬
ting short-changed in the
for
large deficit balance of
—our
philosophy,
now
in
have
in
was
with
And
capita figure,
per
great national
United
Balance of Payments Deficits
storehouse for the world
resource
reached
was
make
al¬
billion
every
in
the
people may enjoy luxuriating in a
debtor
position
but
this
has
trained
largely
a
child
prevailed
States, would
Canada
year
S.
it
$90
college
provided the
5,400 professionally
immigrants (out of the
total of 47,000 coming to you from
Canada).
U.
countries any U. S. concession de¬
signed to assist Canada.
We have long basked in the
sunshine
of
being
a
naturalbut
more
debilitating trend by bringing
Europeans, but this year it
looks as though Canada will lose
more through emigration than she
will
gain through immigration.
Some of the anxiety in Canada
year—almost
a
lived
attitudes
GATT
with
in
Members Hew
of
the
the
geography, demography and eco¬
nomics, Canadians are not at all
disposed to throw in the sponge.
cedures of the past which were
developed to meet the challenges
with
to
Most Favored
is
S.
this
an
production
This
U.
and
woman
trans¬
for
having sustained
long odds of
future, with no allowance for in¬
creased productivity, the rate of
growth during the next five years
will have to average 3.2%
per
tent
of
people. For many years, and
year, Canada has supplied
$540
of
face
Fear
about
—
achieved
ago
Since then, it has slowed down to
Self-Analysis in Progress
countries
man,
commodity trade
taken.
are
long
the
whether
community
nationhood
unless her friends quickly decide
that
so
continue very long as
can
Having
it
exchange,
which
means
the birth of money from
money, is applied to the breeding
of money because the offspring
resembles the parent. Wherefore
of all modes of getting wealth,
ever,
seriously
drastic
i t-
.
"The
Century
separate
a
gain out of
money
that
an
imbalanced; and why
control over major segments of
Canadian industry
continues to
slip away. Some thinking Cana¬
greatest
a
of
cry
seriously
and
with
the
on
Cana¬
of
trade with the United States is
(of wealth
getting),
by
belongs
to
Canada" are
bothered by such
basic questions as why our per
capita output last year was actu¬
ally below that of 1956; why our
calling.
your
He
two
impossible.
due
and
actions
graduates by far than any univer¬
sity in the U. S. Traditionally,
Canada has been able to offset
which would make available to all
Today's
said
about
leaders
statesmen.
our
the
rationalization
all members.
international
the
between
pact membership offers the same privileges
in
other
Canadian market.
Canadian companies are U. S. con¬
trolled but the barriers to trade
any
billion
had
different sizes of tires in its single
plant.
The
majority
of
these
erated. He suggests, instead, what we could do in our own self-in¬
$8^
and
country. Such
Canada's large rubber companies
feels called upon to turn out 600
in joining ECM as currently op¬
highly
one
each
efficiently organized manufacturer
is 250,000 units per year. One of
$90 billion instead of currently $4 bil¬
be
is,
felt that the minimum size for
comparison, adjusted to
to
been exposed to U. S. tastes and
this has served to "fragment" the
has long
example, 24 Canadian man¬
ufacturers of refrigerators com¬
pete for the 340,000-unit Canadian
market, whereas in the U. S. it is
$540 per capita inter¬
a
This figure, in
an
manner.
seems
complex
For
home.
Sorely beset by ECM's remarkable success, serious trade
imbalance with us, and living off capital that
provides for less and
less native control, Canada is said to have
There
Canadian import which
the United States welcomes—that
population-wise, Canada
surprised if Canada reverts to protectionism in order to acquire the
wherewithal to service its
mounting external debt, to reverse its
slowed-down growth, and to
keep Canadians masters of their own
national
imbalanced
States,
By Herbert H. Lank,* President, Du Pont of Canada Limited,
Montreal, Canada
Canadian
their foreign suppliers in such
pro¬
duction
s
79
16
balance
"Peace
of payments may be a
starting point for me to
stress my main thesis, namely, the
necessity of a wider appreciation
of the world's political problems
on
the part of those in positions
of economic responsibility in this
country. There was a time not
long since when if we had a bal¬
ance
of payments problem, cer¬
tain classical, homespun remedies
could rather readily be applied
with the certainty of almost im¬
War?"
or
good
By John J. McCloy,* Counsel, Milbank, Tweed, Hope & Hadley,
New York, N. Y., and Member, Board of Directors, The Chase
Manhattan Bank, New York, N. Y.
A new international "free world" economic
organization and a wider
appreciation of the world's political problems by those holding re¬
sponsible economic positions is the principal note struck by Mr.
McCloy.
It is aimed at those, here and abroad, who still propound
simple remedies of yesterday for today's problems without taking
the
into consideration vast
posals to
adopted.
disarmament
mass
duplicity.
What
there
it
af¬
values
is
it
ficult
to
us
dif¬
sin¬
gle out any
part i cu lar
After
invest¬
disarmament
to
pro¬
which
committed. The effect that
are
would
have
on
a
drastic.
and its ineffectiveness. We do not
to
to shift one's thinking to
hear
much about its successes,
in
num¬
a
of
them
be
dis¬
cussed at talks
John J. McCloy
and
panels
during the course of this meeting,
and I am sure there are few, if
any,
to which I could contribute
any new
thinking.
Recently I happen to have been
concentrating on what I suppose
might be called the problem of
else.
seem
On
the
anything
this
surface
but
may
to be somewhat far removed
as
exchange regulations or market¬
which
yet
is
it
hard
to
the
we
of which
think of any aspect
of this prob¬
lem,
lem which could not
deeply affect
today.
think
I
ask what
situation
in
find ourselves has upon
of
payments
we
take
us
to
task for our failure to
apply some of these measures and
point to their own discipline
the face
of
similar deficits.
Some
the
of
criticism
may
be
justified, but more often I believe
political
balance
our
cal¬
World. The
have
exports.
And this leads me to
ing problems in the selling of se¬
and
could rather rapidly
we
effect
curities,
or
number
culate what effect it would
upon our
from the consideration of security
a
hear
so
prob¬
it
fails
far
as
t^ke into account the
greater complications we face,
well
ago
to
as
the fact that not so long
in large part it was our aid
much which helped
this reference
to
at the
time called
same
to take
up
S.
U.
Must
Constant
of
new
ap¬
vigilance
must
be
maintained to
keep our currency
strong but how it is to be done
and the speed with which it is to
demands
done
be
much
a
thoughtful decision from
it
rather
the
Free
World
more
than
us
nations unburdened
from
does
with
and
even
enabled
them to take the measures
which
heavy
this question of our interna¬
tional payments position in detail
fact
has
become
even
more
challenging, more serious, and ac¬
cordingly any decisions we make
in this field may be both more
significant and more difficult in
the great struggle which is now
going on between the Communist
Free World.
that
believe
do
colleagues
And
of
some
are
our
more
conscious of this fact and the
mu¬
tuality of all our problems is be¬
coming better appreciated than it
has been in the past. The Mone¬
tary Fund meetings have in part
been responsible for this and this
points to a moral I would later
"Peace
BROKERS AND DEALERS
or
Now I should like to say some¬
sion
the
to
speak
likelihood
confidently
of
about
Others
war.
do
and
they, of course, are entitled
opinions, but somehow I
rarely ever alarmed or com¬
forted by what they say. From
all the factors I can appraise I am
to their
am
bound to
tion
is
conclude that
serious
and
the situa¬
the
issue
far
What
20
BROAD STREET
could bring
know it to
5, N. Y.
Teletype NY 1-1110 & NY 1-1111
Telephone HAnover 2-5000
we
all
know is
that
the
Soviets and ourselves possess be¬
tween us the means by which we
NEW YORK
civilization
an
end—an
which
mankind
better
part
of
a
as we now
end from
might take the
century to re¬
cover.
After
ages
of
endeavor
mankind has achieved the doubt¬
ful
success
of
inventing what is
DIRECT
Burgess & Leith
Philadelphia
Boston
WIRES
TO
Los
Angeles
Houston Hill Jr. & Co.
San Francisco
ir¬
decisions.
think
I
Khrushchev
Mr.
demonstrated
his
to
satisfaction
our
he
has
and
own
that
to
can
put
up a 100 megaton bomb. If he did
not explode one quite that large
in this last series of tests, he made
it clear he could, and I have no
doubt
could
we
explode
100
a
it necessary, And if war came it
would really not take very many
of them to
bring about an entirely
very
much simplified
things in what would be
and
new
order of
ieft of this world.
World Attitudes Not Comforting
We also know that the world is
torn
by as sharp
political schism
in
isted
has
ever
times.
the
ex¬
Perhaps
deeper and
was
when
ideological and
as
modern
the division
hostile
an
infidel
more
set
was
against the Christian in the Mid¬
Ages; maybe it was deeper
dle
when
the barbarian opposed
Rome, but whatever the historical
analogy, it is clear that the pres¬
sures,
the intrigues, the propa¬
ganda,
the determination, the
abusive interchanges between
ourselves and the Communists
about
great
as
are
they can be
short of war, and the combination
of the
atmosphere which these
produce
these
as
and
the
existence
of
destruction weapons
mass
survival
was
not
also
their busi¬
ness)
without
giving
much
thought or attention to the inter¬
national
simply
threats
and
incidents
because
they truly feel
there is nothing they can do about
them; I can also understand how
they may have an opinion in re¬
gard to the likelihood of trouble
Berlin, but I do not
over
within
reason
anyone
how
see
feel
can
with any assurance that peace can
be preserved interminably, how¬
sharp the issues, merely by
continuity of great armed
strength on both sides. I have not
yet seen emerge a satisfactory
ever
the
to the Berlin
answer
us
problem, but
say
able, we do pass the crisis of
Berlin, what about the next one,
for these crises have
ant record
We
can
outset
of
of
an
unpleas¬
recurring.
all
recall
World
how
War
at
II
a succession of
crises, such
Austria, Czechoslovakia. These
were passed, if not without some
misgivings, and then came Poland.
It takes, I submit, more than a
were
as
nice
balance of weapons to keep
the touch-off issue from arising if
no
fundamental
thing
change in the
place. I conclude
imperative is to do some¬
to change the conditions
under
which
situation
takes
our
we
are
labor¬
now
ing, and that it is incumbent
upon
all those who claim to be knowl¬
edgeable
and
responsible mem¬
bers of the community to give
thought as to what can be done
to change these conditions.
It
is
considerations
such
these which have caused
so
attention to be centered upon dis¬
in recent years.
Al¬
though in itself it is not the
war as
settling our interna¬
tional disputes, or it could mean
the starting point of disaster. I
venture to say that no one really
swer
knows
arms
of
what
the
consequence
of
man's possession of these weapons
as
much
towards the elimination of
means
the
there
armament
a
Wheeler & Cruttenden, Inc.
become
now
almost the ultimate weapon. This
could be the starting point
fact
Elkins, Morris, Stokes & Co.
has
hind the statesmen who make the
that
from settled.
Exchange
war
rational, it will not occur. If war
is to be avoided, it will require
thought and effort rather than a
mere balance of fear;
it will re¬
quire, as I see it, a high order of
statesmanship and some good for¬
tune; and it will also require an
enlightened body of opinion be¬
day and that is the likelihood of
peace
or
war
in this troubled
world. I often wish I had the vi¬
Stock
because
that by some honorable
and wise action not yet recogniz¬
War"?
thing about which I believe is
really the burning question of the
Members New York Stock Exchange
stupidities for us to take
thought that
much comfort in the
let
draw.
ASlEL & CO.
mere
existence. Mankind has too long a
record of
more
that since then the world
is
situation
European
SINCE 1878
their
from
is, to put it mildly, far from com¬
forting ; when we contemplate the
possibilities of an outbreak.
regional group of investment
I can understand people going
bankers, and I am not going to
repeat the effort at this time. The about their business (as if their
somewhat
another
before
world and the
Members American
automatically
of
crown
op
I
SERVICING
will not follow
war
or indeed a 1,000 mega¬
ton bomb ourselves if we thought
Cautiously
Move
belief is that the
my
megaton
leadership. To put it
other nations enjoy. If we sud¬ another
way,
it requires more
denly applied a ban on foreign than monetary adjustments to ar¬
investments; if we shut off all aid; rive at the proper decision. It
if
we
did
not
permit foreign may well involve a rather agoniz¬
travel; if we hoisted our interest ing reappraisal of a number of
rates and our tariffs; if we closed international political elements as
down on foreign investments; if well. This presents a rather nar¬
we
withdrew
our
troops from row ridge along which those re¬
Europe and cut our military ex¬ sponsible for our financial plan¬
penditures
overseas,
we
would ning have to travel compared
not have a balance of payments with the paths others can choose.
problem, but we would have some It has constantly to be kept in
other problems so serious that we mind by all that the danger to
might even seek a little imbal¬ our security and that of the Free
ance to remedy them.
World is located fairly close up
There has been a disposition on on both slopes.
the part of some critics abroad to
Some time ago I tried to devel¬
problem that it is rather difficult
ber
will
seen
on
that of the Free
the impair¬
would have
our security
is, however, that though we
can't permit the deficits to persist,
we
do not enjoy the freedom of
action to deal with them that
peace and war and its relation to
disarmament. It is so absorbing a
pose
defense, directly
sup¬
profound effect
and
have
at
were
of our currency, and
ment of our currency
indirectly?
I
of figures—
figures depend largely upon
what you mean by the word "in¬
directly." Suppose we say 20% or
even 25%, whatever the percent¬
age is—we all know our defense
activity has become an enormous
factor in our economy and a com¬
prehensive disarmament plant, if
put into effect, would require
some
major readjustments. They
are
adjustments which could be
made, but they would not be
minor. Or suppose the aid pro¬
gram
was
suddenly abandoned?
We hear a lot about its wastage
I
one.
were
larger shares of
economic aid to under-developed
countries and a larger share of
their
overall
military responsi¬
bilities, we would probably have
$3 billion deficit in those bal¬
without serious impairment
or
fact
your
balancing payments
is immeasurably complicated by
the political situation the world
faces. If we did clamp down in
the way many advocate we
should, we might well bring about
a
collapse of our whole world
position. Other countries not in
position of leadership do not have
to weigh as carefully as do we the
impact of what we do on the
strength and political attitude of
a
large number of countries and
peoples, including some in Eu¬
rope. If they were suddenly de¬
prived of our markets and capital,
and
be, but
may
avoidance of
Our task of
ances
What it
would do to some of our growth
stocks, the airplane manufacturers
and many other modern producers
would be very marked. How much
of our industry is today related to
quite
Deficit
Thursday, December 28, 1961
...
improved
their
about
period when our
roughly in balance,
to face a recurrence
we are again faced with a deficit
of serious proportions. We know peals for help.
that we cannot long stand a $2
economy
be
interna¬
short
a
accounts
for example, that
suddenly accepted a
under principles
serious
without
Payments
say,
Soviets
could
deter¬
investment
that
Let
we
n
including
any
"Serious Proportions"
banking.
ment
the
gram
country
fects
business,
any
was
brought
position.
upon
enlarging
economic challenge.
far-reaching
many
mination
or
some
i
the
easily—outdistance the Sino-Soviet
can
difficulty in se¬
lecting a subject which seemed
appropriate for a group of invest¬
ment bankers. Perhaps it is be¬
problems
or
is
there
If
repercussions. Things have
changed, however.
membership of the pioneering ECM. This step, he says,
needed to—and
which before long will seriously mount their
I have had
so
McCloy envisions
Mr.
following, somehow, Britain's footsteps in joining
is what is
this
pro¬
tional
the "free world"
whose
diverse
are
dealing with the U.S.S.R. illustrated by first-hand recollections of
U. S. A.
are
Reviewed
taken
cure our
relief.
pain involved, it was largely do¬
mestic and such steps could be
balance of payments deficit, and the difficulties
their
cause
mediate
complicated changes and dangerous interna¬
tional repercussions if they are
of
Chronicle
The Commercial and Financial
to
the
threat
of
war,
an¬
the
concept of disarmament is strong¬
ly imbedded in people's minds as
an aid to it. If we could
stop the
race
and
beat
Continued
our
on
swords
page
82
Volume
194
Number 6120
The Commercial and Financial Chronicle
Dilemma
Confronting U. S.
Regarding Latin America
for
hand
study as Presidential Special Ambassador and Personal
Representative in 1953, 1957, 1959 and 1960. Dr. Eisenhower finds
quickly increase
our
aid to that
with annual imbalances and that
us
we
international deficit payments problem, the
the disastrous threat this
poses for our
have
now
which
financial difficulties,
be disastrous both
would
world, surely merits careful
University head ponders
Dillon's Policy
fore
(2) keep our export costs down; and (3)
foreign aid to the imperative and, if need be, set up a
priority as to which part of the world needs our aid the most and
the
Senate
Appropriations
on
after
our
Punta
del Este commitment for
greater aid to Latin America said:
concentrate it there.
"I wish to
emphasize that it is the
form in which aid is extended
that is most relevant to this
ques¬
tion
(of international
...
bankers,
investment
counsellors
leading
as
and
ad¬
ministrators, must be deeply con¬
cerned, as I am, with trends in
ing
concern
and
individual
for
human
dignity
freedom.
balances).
The average per capita income
in Latin America varies from $55
inter national
year in one nation to
nearly
$1,100 in another. The disparities
~finance which
within each of the Latin countries
threaten
the
soundness
our
are
that
world
ship
leader¬
places
families is few. The
upon
In
this
situation
compelled
to
make
tion
of
to
to
national
dilemma
in
discuss
relation
responsibilities in
our
this
to
major
of the world—namely, Latin
area
one
America.
I
am
we all recognize the
interdependence of the
sure
exacting
United States and the republics of
Latin America. Our private and
public investments in these coun¬
tries exceed $11 billion and, save
in Cuba where unmitigated rob¬
bery has replaced honesty and
decency, our investments earn a
fair
Trade
return.
with
Latin
America—amounting to $4 billion
a
year
each way—exceeds that
with Europe and with all other
areas of
the world, except Can¬
ada. We import from Latin Amer¬
ica a vast array of primary com¬
modities which are indispensable
to the operation of our immense
industrial and business complex,
and we export to Latin America
manufactured and processed
goods that represent the entire
gamut of our production.
But the economic significance
of
the
American
welfare
is
nations
to
our
greater than their
social, cultural, and political im¬
portance to us. Most of the na¬
tions of this hemisphere adhere,
as we do, to the Judaic-Christian
philosophy which places human
values
no
above
material considera¬
stratifica¬
which
history.
communication
masses
has
But
new
program,
as
at
of United
States goods and serv¬
by aid recipients. The pre¬
ponderant bulk of foreign aid ex¬
penditures will be made in the
United States. Such
expenditures,
which are accompanied
by Amer¬
ican
exports, have
no
adverse im¬
pact on our balance of payments.
Our objective will be to reserve
between 75 and 80% of the avail¬
able
funds
for
procurement
of
United States goods and services."
noted, however, that
policy enunciated by Secre¬
several years and has left us with
the annual imbalance I have men¬
are
the
di¬
thefts? And, fourth, would Castro,
either
as
democratic
leader
or
custom
opposite phase
increase
aid
the
meet
of
that
is
of
our
must
we
to Latin America
We
with
proceed
of
political instability
today in Ecuador, Northern Bra¬
zil, Peru, Panama, El Salvador,
primary
attention
and
three
these
of
other
countries.
revolution
has
been
sons
threat
made
Castro-communism
South
in
the
of
concerned
United
States
to
issues.
with
the
gave
the
first
Most
peo¬
were
more
fourth,
America.
Consequently, our attitude be¬
deeply
and
unanimously
antagonistic. That in Latin Amer¬
in
the
United
mystified by the sup¬
came
ica
became
ambivalent, though
Castro, has at¬ mainly sympathetic.
hemisphere,
This
divergence in
attitudes
inhumanity as was due to a sharp change in our
being worse than that of Trujillo,
thinking, not so much in theirs.
Perez Jimenez, and Peron. If we
At the
boyant
dictator,
tained throughout the
while we view his
height of the revolutionary
struggle and even for a short time
are
to exercise the degree of
patience required of us—if we are
be
to
effective
in
keeping
after Castro seized power, he was
hero in Cuba, in Latin
America,
Latin
a
America within the fold of free¬
in the United States—indeed, in
dom-loving nations—it is impera¬ all the free world. This
was
a
we understand
why this natural reaction of decent
people
divergence of view has developed. who
were
disgusted
with
the
tive that
The
In
the
Castro
brutality of Batista and deluded
by
Castro's
repeated
promises
that,
when
the
revolutionary
Story
tumultuous months fol¬
lowing Castro's victory as a revo¬
lutionary leader, four distinct is¬
sues emerged:
First, was Cuba at
last to enjoy democratic
freedom,
or
to suffer still another
even
worse
forces succeeded, the constitution
of
1940 would become the su¬
preme
freedom
of
information,
rights set forth in the con-r
stitution, and general elections
tyranny,
all
than that imposed by
the
arrogant Sergeant Batista?
Second, if tyranny were the un¬
happy lot of the people, would it
be indigenous or would it
in
defiance
within
Batista.
a
after the defeat of
year
His
propaganda continu¬
ously called for "a free and dem¬
ocratic
Cuba
of
dedicated
to
policies to which the and economic
justice."
American community ad¬
But shortly after he
whole
heres—be dominated by
sive
law of the land. He guar¬
anteed
extracontinental
nor
a
subver¬
power,
Castro
power?
began
Continued
social
came
to
on
which
will
page
wit¬
reforms
—
enable
productive
enterprise to benefit all of the
people, as it does in the United
States.
Since World War II the revolu¬
tionary threat has been
in
growing
America with bewilder¬
Latin
ing speed. We in the United States
have tried
as
best
we
could to be
helpful. We have provided tech¬
nical
assistance designed to at¬
tack the problem of mass illiter¬
acy and to improve the level of
education generally; to increase
and
pand
diversify agriculture; to
health
facilities,
and
ex¬
to
bring better management into gov¬
ernmental,
industrial,
business
and other undertakings. We have
shipped large quantities of sur¬
plus food to meet emergency sit¬
uations which
threatened
starva¬
tion, and we have extended loans
to speed economic development.
In the past eight years, we have
doubled the rate of public and
private investment in Latin
America, as
compared
to
any
previous period.
Now, under the 1960 Act of
Bogota, fostered by President
Eisenhower, and the Charter of
Punta
del
Este,
sponsored
by
President
Kennedy in harmony
Coast-to-Coast
•
Underwriters of
Bonds
•
Correspondent Network
Corporate Securities • Underwriters of State, Municipal and Revenue
Complete Brokerage Service in Stocks and Bonds
•
Primary Markets in
over
•
Comprehensive Research
300 Unlisted Securities
tions.
Together, we cherish inde- with his Alliance for Progress
pendence, freedom, human proposal, we have guaranteed to
dignity, and mutuality in human provide Latin America with $20
relations.
We
seek
to
maintain billion, mostly public credits, in
political and social institutions the next 10 years.
which
are
enhancement
human
conducive
most
of
values.
these
to
n
supreme
selves
has
world
time
abhor
standing
struggle
decide
together in the
which
will
in
whether
humanity
will progress
bound by
be
of
in freedom or again
the age-old fetters
tyranny imposed by an omnip¬
Against
Poverty
Unfortunately, most of the
tions
of
Latin
America
na¬
have not
economically as
rapidly as they could and should.
Hence, we find that economic
matters dominate the thinking of
our
southern
neighbors,
some¬
times to the point of subordinat¬
progressed
York Stock
n
for
several years,
in
difficulty in the field of
international balance of payments.
Exports of goods and services
from
the
to exceed
a
and
United
States
But support of our
forces abroad, military
aid to other
gWv&Qte-J
favorable trade balances and have
a
deficit in international
balances each year. Between
1961
Corporate
our
gold
Teletype:
NY
JT. &.
1-865
Cable
We have direct wires to
reserves
1957
de¬
clined by $5.4 billion. In the same
Anaheim
Albuquerque
Charlottesville
coun¬
including Latin America,
and a steady outflow of private
investment capital have overcome
yielded
Exchange
Telephone WHitehall 3-7600
imports by $3 to $4 bil¬
tries,
and
American Stock Exchange
•
Stock
•
Address:
Municipal
Teletype:
NY
1-1691
Gregsons
continue
year.
economic
Exchange
Midwest
been
military
Revolt
New
serious
lion
otent state.
Members
,
This
totalitarianism in every form, and
in most situations we find our¬
we
fa
the
guarantee poses the first
part of the dilemma I mentioned.
The United States is today, and
Hence,
El Paso
Chicago
Asheville
Cincinnati
Farmington, N. M.
Correspondents in the following cities:
Baltimore
Cleveland
Beverly Hills
Columbus
Fayetteville, Ark.
Dallas
Fullerton
Denver
Boston
Burlington
Des Moines
Grand
Detroit
Rapids
Harrisburg
Herkimer, N. Y.
Houston
Indianapolis
Joplin
Kansas City
Kilmarnock, Va.
Los Angeles
Malone
Minneapolis
Nashville
New Orleans
Philadelphia
Pikesville, Md.
Pittsburgh
Portland, Ore.
Redlands, Cal.
Reno
Rome, N. Y.
St. Louis
Salt Lake City
San Antonio
San Diego
San Francisco
Santa Ana
Sante Fe
Seattle
Toronto
Tulsa
IJtica
Victoria, Tex.
Washington
Westwood
Whittier
wmmmmmmmmmmmm
to
reveal
nessing widespread, insistent de¬
mands for reforms
the
promise of social reforms.
Central
persons
are
in
ples in Latin America
far
dangerous by the spread of
more
and
The
promised
initially had
gained him the support of Cubans
and of the hemisphere generally?
As events unfolded, most per¬
dramatic
see
would they be outright
social reforms which
to
rapidly growing threat
revolution.
evidence
or
dictator,
quickly
—
It must be
the
tary Dillon has been in effect for
therefore
The
lemma
ices
to the fact that
neither universal
are
inevitable. We
the
present, we will continue to place
primary emphasis on the purchase
has
poverty, human misery, and deg¬
radation
be
I want
of the
the beginning
from
American
alerted the
Dr. M. S. Eisenhower
masses
social
and
evident
Latin
middle-income
of
inheritance
an
modern
none
which
seems
is
been
choices,
attractive.
uncom¬
desperately poor.
are
Economic
w e
are
number
people
increased
of
at all
not
Latin American
a
The
burdens
us.
It is
between
country
for a relatively few families to be
quite rich, some fabulously so.
very
time
in
mon
than
greater
even
countries.
f
currency
the
at
o
a
Under
enhance
HI
port which the egocentric, flam¬
Committee
shortly
will
area
Third, would threatened expro¬
priations of property be handled
in
harmony with international
problem.
Most
Secretary Dillon, testifying be¬
our
Investment
external
States
developed free world;
restrict
en¬
tioned. It follows that greater aid
to Latin America or
any other
consideration.
country and the free world.
(1) more foreign aid from the
Resolvable suggestions made include:
can
domestically and throughout the
free
serious
a
backing
our
countering
needed, and committed, amount of $20 billion in the next 10 years
at a financially
inopportune time for us even though it will
be mostly in the form of
public credits. Noting that past similar aid
comes
has left
as
How long the United States
tolerate this situation without
but observes that the
area
reserve
currency, the actual defi¬
gold supply, to set¬
tle
international
accounts,
has
reached more than $13 billion and
threatens to become greater.
Depiction of grave national dilemma confronting us with
respect to
Latin American responsibilities reflects much of
Dr. Eisenhower's
must
our
ciency in
our
we
period, foreign claims against
United States gold increased
by
$4.7 billion. Today, foreign claims
exceed our total gold supply
by
more than
$2 billion. Since more
than $11 billion in
gold must by
law be held in
By Dr. Milton S. Eisenhower,* President, Johns Hopkins
University,
Baltimore, Md.
first
17
76
18
The Commercial and Financial Chronicle
Prior to the SBIC
Growing Role of the SBICs
By Phil David Fine,* Deputy Administrator of the Small
Business
Investment bankers
Administration, Washington, D. C.
are
of SBICs since their
ticipate
more
number 425
brought up to date
on
the growth and impact
statutory inception in 1998, and invited to
fully in this financing medium. SBICs
are
said to
million investment
potential, which include 42 that have
in the total amount of $300 million with another 17 SBICs
now
registration for
a
total of $80 million
public
gone
currently in
Described is the investor
more.
of all this in the investment
SBIC,
the
vided
an
meet
appeal these companies have, their contribution to the economy's
growth, the participatory role of commercial banks, and the growing
awareness
of
which
in
a
few
V|ew, I'm
were
years
sure,
that
there
ago
who
ever
visualized the government's being
the investment banking busi-
Small
in
through
Small
small
an
are
we
very
much in it to¬
ri
a
y
the
Business
In-
vestment
gram.
those
For
not
are
fully ac¬
quainted with
What
SBICs, per¬
haps I should
describe
brief.
In
1958 the
Reserve
of
the
SBIC
has
done
is
to
a
Congress, after
study by the Fed¬
established
which
capital for small business
and make the rules open for pub¬
lic scrutiny very much as invest¬
ment
bankers
and
major stock
exchanges have done for bigger
registration with the SEC for
of
ing business.
If the volume of sales were the
our
only criterion by which to judge
the SBIC, it would be less than
the
SBIC
the
sup¬
the
sources
has
It
has
the
in
out
expanded
done
rules
the
to
more
for
which is deserving of
attention.
Ordinarily it takes quite a bit
of time for reasonably widespread
appreciation of the potentialities
open.
tremen¬
a
dous degree both an awareness of
and the sources of venture capital
funds.
of
business
previously
men
at
The
derwriting venture, it has worth
as
a
profit-making invest¬
ment medium which will show big
appreciations in the future, the
degree
of
which will
depend
upon the management personnel
primary aim of
to create and
of capital for
Currently, these 42 ' S BI Cs
which are publicly held are sell¬
ing at prices averaging 118% of
"Public"
business
book value.
While
never
investment
centrated
into
groups
before been
even
a
venes
torial
well
these
initial
SBICs
funds
aware
were
very
few
investment
that
their
inadequate
"Out
might
I
to
a
of
Vogue"
add,
it
contra¬
considerable degree the
that
tion—it is
to
llllljl
SBICs
are
"out
an
of
established fact that
Established 1891
Hii! Home Office;
:
GOVERNMENT
STATE
•
•
•
MUNICIPAL
and other
in regis¬
now
it
ought to be noted that
60
SBICs
number
than
more
their principal stockhold¬
among
in
t h
Nation's
e
some
A
the
cases
some
than
shareholder—more
banks,
of what this
public acceptance—through secu¬
example
underwriters—has
rities
be shown in a
can
One
SBIC, backed by a small
of banks—among other
stockholders—sought the public
sale of stock jointly through an
underwriting firm with limited
experience and reputation, and
through a hastily set up organiza¬
tion composed mainly of the com¬
mercial banks listed among the
stockholders.
The
firm
underwriting
sale
the
took
on
Broadway, JNtetf
Exchange ;•
basis.
result at the end
net
a
a
good underwriter could place in
half day.
Convinced finally that commer¬
cial
banks
not
are
equipped
projects, and after settling
with the original underwriter, the
SBIC began anew. With a com¬
plete reorganization and by en¬
listing the services of an estab¬
lished investment banking firm,
the SBIC was able to complete a
successful public sale amounting
to more than $5 million within a
few weeks.
Presently, there are in exist¬
425 SBICs, with total capital
ence
available
or
about to be available
in
investment
for
small business
$500
to
million.
they have
of
50%
lion,
or
of that figure,
$750
million
rowing
power
from
outside
sources.
This
growth is buttressed fur¬
another 300 proposals
either ready for licensing or unther
by
CO
t':;*
Yo'rk 4£: N'&w
York
|||
•
CREATIVE
RESEARCH
•
prmctpai Siook and 'Commodity Exohmgee ||f
Key
*.
80 Pine
Albany
Boston
Midwest Stock Exchange
Street, New York 5, N. Y.
Chicaco
CORPORATE, STATE, MUNICIPAL
Exchange
Exchange (Assoc.)
Philadelphia
San Francisco
Hong Kong
and REVENUE
a
$250 mil¬
altogether.
DEALERS and BROKERS in
American Stock
In
And this is exclusive of their bor¬
UNDERWRITERS
members
for
such
Knowledge, Experience, Facilities for Investors
New York Stock
a
was
investing
Pressprich dC Co.
of
that less than $200,000
in stock had been sold, less than
year
toisound
R. W.
under¬
"best efforts"
a
INDUSTRIAL
STOCKS
done
single instance.
group
8C RAILROAD BONDS
INVESTMENT
of
the country.
of the largest in
good
EQUIPMENT TRUST CERTIFICATES
•
sole
125
including
PUBLIC REVENUE BONDS
PUBLIC UTILITY
mil¬
lion.
Offices in 40 Cities
Members: Now York Stock Exchange
HOUSING AUTHORITY
17
the
still another $80
for
GOODBODY&
American Stock
$210
borrowing potential from the SBA
vogue" in Wall Street.
But regardless of criticism by
Barron's—or any other publica¬
possible future benefits
on
which I plan to touch. Because 42
as
of
a
recent statement in Barron's edi¬
direct benefit for
as
nearly
addition to this sum,
And,
investment bankers
tration
amounting
Not
might add that the SBIC pro¬
has had
sub¬
dozen
a
some
be
can
medium.
con¬
to say nothing of 425 com¬
gram
ratio
slightly more for
companies — as
an
panies.
I
this
to numerous interpreta¬
tions by dozens of securities an¬
alysts, it is nevertheless a firm
indication of public acceptance of
SBICs
after
only a yea r—or
jected
companies in business, with near¬
ly $450 million in capital and
with
investment
potential
in
small
business
of $700 million.
This capital has always existed,
but it has
SBIC.
of each
proof that the principal aim
has a good running start in the
proper direction, I cite the fact
that as of Nov. 29 there are nearly
small
include
not
The
now
As
425
had
medium
It had worth not only as an un¬
business.
Gone
principals—
for
stock
of
million, $132 million of which was
sold
in July, August and
Sep¬
tember of this year, and that does
worth.
businesses.
42
their
investment
new
program was
formalize sources
small
and
of whom, I might add, can
any financial "Who's
Who"—and decided quickly they
liked what they saw and that the
These have been incidental de¬
velopments.
SBICs
sales
be found in
previously unaware.
the
In
many
loans, an awareness of sources of
equity funds and at the same
time, indirectly, directed them to
people and organizations which
were
able to provide them with
knowledge of other financing in¬
struments beside
loans, instru¬
ments of financing of which some
were
investment medium.
new
the investment banking
fraternity took a good, hard look
only commercial
oriented toward
a
this case,
Beyond that, it has provided for
27
year,
SBICs have had successful public
ers—and
to
this
of
first
the
since
And
bit
fair
a
that the SBIC had investor appeal
outdistanced
formalize
than
venture
Phil David Fine
in
completion of
eral
sources
institutionalize the procurement of
this
program
been
equity capital available to larger
businesses almost since the begin¬
ning of our country. And there
have always been individuals and
businesses ready to invest in
promising situations.
Company pro¬
who
have
than $300 mil¬
17 SBIC's are
taining equity capital and to bring
had
small
businesses.
There
more
ob¬
But
long-term
license, supervise and, in certain
cases, help finance small business
investment companies which
would serve as sources of equity
capital and long-term loans to
as
ness
active partner,
was
impressive in comparison to un¬
derwritings in other fields.
However, it is the awareness
displayed by people in the invest¬
ment banking field in recognizing
sense,
Business Administration to
;■
$80 million more.
This
represents
has grown so big, in a
that demands for such
funds
funds for small
business were not easily avail¬
able, passed a law authorizing the
saw
business for the investment bank¬
ply.
Althdugh
IBA.
lion while another
economy
banking field.
the
lic sales
pro¬
needed
in
situation
a
has
government
instrument
they
Thursday, December 28, 1961
The total amount of their pub¬
nigh impossible to obtain
equity funds.
By formalizing sources of funds
for small businesses through the
companies, with nearly $450 million in capital and $700
.
.
coming up, promptly went "pub¬
lic" through underwritings
con¬
ducted by quite a few members
venture
capital on varying terms by con¬
tacting
friends,
or
friends
of
friends and any who would listen.
But it was always difficult to ob¬
tain in adequate sums, and in re¬
cent years small business found it
well
par¬
which
needs
the
meet
small busi¬
a
sought
usually
nessman
.
BONDS
Volume
der
Number 6120
194
review for another $120
mil¬
..
The Commercial and Financial Chronicle
.
growth
excellent
and
lion.
but his individual
Many of these will be
public as the awareness
strained.
that
to
maintain
an
portfolio requires
more
minimum
with
of
capital
started in
many
the
the
adequate
than
equipment
grows
the
which
How Did This
SBIC,
From
study
A
a
bit.
Phenomenon, the
Federal
earlier
had
ad¬
He
needed
resourceful
equity
potential
money.
SBIC
which
as
an
the
bank
would
asset.
His
Picture
than three years, the Small
Business Investment Act of 1958
sales
of
$700,000
higher than the pre¬
vious year; his net profits were
double, even after the big per¬
centage bite taken by corporate
was
income tax.
more
born, and with it the SBICs.
In
the
$1
beginning
there
were
those seeking to form SBICs who
lacked investment knowledge and
who
in the program possibil¬
saw
ities
which
they
couldn't
prop¬
erly evaluate.
But, there
sensed
immediately what an SBIC
become; analyzed its favor¬
able tax climate, saw the tremen¬
could
dous
need
and
moved
into
high
gear.
an
instance of the kind of
situation best suited to the SBIC.
A
midwestern
electronics
en¬
gineer
with
considerable
back¬
ground in his field and author of
numerous
full
a
tary and
on
electronics,
firm.
It consisted
papers
started his
own
time
engineer,
a
secre¬
part-time help.
Because he had helped develop
instrument
systems
for
guided
missiles in the Naval Research
some
Laboratory, he was able to obtain
a consulting contract from a near¬
by Air Force Base.
lowed
with
by
two
This
development
fol¬
was
contracts
commercial firms.
At the end of his first year he
showed
In
$5,000 net profit.
•
following year he ob¬
a
the
tained contracts with three major
missile manufacturers for the de¬
velopment
of
other
and
signal conditioners
telemetering equip¬
ment.
As
a
result
of
these
the
firm
developed
line
of
telemetering
contracts
proprietary
components
and began the sale of these items.
a
His
backlog stood at
million,
and yet, he couldn't
his creditors and had a $26,-
pay
000
installment
income
on
taxes
due in March.
a
receivers
and
the
others
for
telemetering equipment.
Working with his accountants,
made a financial analysis of
his position and called in an un¬
he
derwriter's
representative.
their
securities.
Then the
engineer contacted
an
SBIC.
worked out an
arrangement with two SBICs for
$1
million
in
capitalization
whereby he would set aside 50,000
shares
comprising 23%
of
the
stock, for conversion at $4.50 a
share, while the selling price
would be $5 a share.
400%
increase
to the
needs
of
mark you,
if you will go
trouble of investigating the
(and profit potentialities)
than
more
150,000 of the Na¬
tion's
hitherto
neglected
small
businesses
and by small busi¬
I
those
mean
facturing
and
other
manu¬
businesses
with assets of $250,000 and
up¬
ward—you will, I am sure, decide
it's time you got in on a
tre¬
made the arrangements I've
cited
previously—and they are true ex¬
cept as to geographical location
manufacturing category.
let's suppose the elec¬
Again,
tronics company grew to the point
this one did—where it was
—as
ready for
public offering.
a
It would then need
The
board
SBICs
had
representation
and
were
I
won't
but
the
go
into
business
all the details,
has grown tre¬
However, at the rate the com¬
is growing, they both prefer
pany
to wait for
bigger profits.
Lesson
This may
for
Underwriters
seem
and drawn-out
long detailed
a
story, but I cited it
that
if
a
bankers
you
Richmond team,
big profit coming.
Nor does
it take
that
small
one
have
you
successful
a
Beyond
to know
which
sale
;
.
both
is
of
for
stock
is
investment
made
banking
of
I
medium
it
eight months
of
SBICs showed
a
the
If
is
a
80
on
and
can
offering.
And
would
hope
like
that
others,
such
a
firm
would be attracted by your repu¬
tation to come to you.
You might
get it.
Now let's
hand that
suppose
the other
on
of the SBICs which
one
did supply
the needed capital was
subsidiary company or affiliated
a
with
for
underwriting firm.
your
Where
would
that
business
no
place
in
first
will
be
will
punished
nesses
of
can
can
frontal
a
remain
us
to the point
where
challenge—and
sheer
wouldn't
will—the
challenge
is
banker's—to
the
invest¬
expand
busi¬
♦An
SOth
ment
without which
address
Annual
by
Mr.
Fine
Convention
Bankers
of
Association
before
the
of
for
the
Hollywood Beach, Fla., Nov. 29, 1961.
It
confidence in
funds
it
needed.
fanciful idea.
no
PRIMARY MARKETS FOR
Three participant underwriters
already have strong financial in¬
terests
in
SBICs.
More
will
fol¬
low.
When
to
Hillon, Manley and Clair,
synthesize underwriting firms,
or
Widder,
realize that
the
same
Beanbody,
an
York
that
club
does
began
can
function for
underwriter
baseball
SBIC
a
the
for
INSTITUTIONAL INVESTORS
to
perform
securities
U. S. Governments
Richmond
the
New
Federal
Yankees, that firm will hold
Agency Issues
Municipals
"I
Public Utilities
Industrials
UNDERWRITERS
Railroads
Equipment Trusts
DEALERS
BROKERS
•
Established
Bankers
Acceptances
Finance
Paper
Canadian Issues
1868
Preferred Stocks
Spencer Trask &
25
BROAD
Co.
SALOMON
STREET, NEW YORK 4, N. Y.
BROTHERS
H
Members
New York Stock
Exchange
NASHVILLE
BOSTON
NEWARK
HUTZLER
SIXTY
NEW
WALL STREET
YORK 5 N. Y.
HAnover 2-8700
Members New York Stock
Exchange
American Stock Exchange
BOSTON
ALBANY
CHICAGO
SCHENECTADY
GLENS FALLS
WORCESTER
SAN
FRANCISCO
PHILADELPHIA
the
Invest¬
America,
your
This is
our
So is the de¬
go
anywhere.
go
have the
so
we
over¬
financing?
It
en¬
cision.
view the
of
we
segment
one
through
The
needing—and lacking—the
financial guidance
ahead,
Nation's businesses.
thousands
an
we'll be
pace
will dare attempt
ment
the
wither.
But for these who
potential
by
attacker who sought to destroy us.
The
and
keep
forging
come
pro¬
lack management know how.
potential lies be¬
alive to thrive, regain power and
pro¬
the
I
to
do
can
attack
do not
we
emy
gram for charlatans and those who
second
You might not.
is
to
patriotism,
vulnerable target for attack.
attack, lest
-\.Y.
There
firm,
your
appeal
an
who would destroy us.
loom against
such
an
not
period where only
a
our
and
how.
for
in
and
businesses
financial
arrangements
of
are
achieve such potential that no en¬
first
program
us
By
now
their
12.8% return
capital)
benefits
Nation.
our
emy
by the
fraternity
(In
small
tween
stay.
of
this,
cupidity
the threat of
point out only that it is
tested
tax
We live in
their decision to make.
a
investment
for
operator
help expand the potential might
-.-r
The SBIC is here to
use
rich
the
point to what adequate financing
"Here to Stay"
What
be
as
be ignored—and of real ad¬
vantage to the businesses to be
a
will make up for the 10 or more
in the subsidiary SBIC portfolio
which show merely taxable profits.
will
SBIC—those
senior part¬
business
public
a
to
brought to the point where it has
a
attained,
aided.
in Lehman Brothers
ner
It
can
restore
mendously and the conversion
rights of the SBICs would show a
realizable profit of $96,000.
know
be
lies ahead.
duce profits for those with know-
adequate
satisfied.
banking field.
Casey Stengel
cannot
success
underwriting house to handle its
affiliate SBIC that it would
easily be guided to your parent
feet.
investment
invested
reputable
a
the
It doesn't take
mendous potentiality.
Let me chart such a possibility.
Let's
suppose
that the SBICs
firm
and
he[ showed
an after-tax
profit of $24,000.
The
following year brought
financing.
But,
the electronics business
its
rich goal
the
banking
possible public sale followed and
was on
spot
the
major leagues
such
would
The usual agreements regarding
do in the
get one
Tony Kubek out of 16 rookies on
*
Eventually, he
Sales for that year were $200,000,
a
investment
enviable
same
to
an
after
an
own, said they
were
unable to assure any firm
commitment for the sale of equity
of
the
Yankees
may or may not be interested in
Regulation A financing. There are
advantages and disadvantages to
underwriters,
analysis
lesson to
a
of
and
biggest single backlog was
$500,000 order for telephone fac¬
were
points out
firm
His
The
I cite
of
annual
350%
simile
those also who
were
An
nesses
were
it
studied.
—
An SBIC Entered the
mentioned
the
was
because
be
no
studying
his application for
funds, saw the
Reserve
earlier, which
synthesis of findings by
Congressional groups holding
hearings across the country for
which
$25,000 would advance
consider
About?
needed.
was
bank
vanced
more.
Come
the
A
so
early stages
in history
back
go
were
Paydays were running
90 days slow. He passed his sal¬
ary for three months and essential
going
program.
Let's
potential
resources
19
;
DALLAS
CLEVELAND
CHICAGO
PALM BEACH
20
The Investment Banker and
By Leonard
F. Nichols,*
Financing
Comptroller and Member, Maritime
Subsidy Board, Maritime Administration, U. S. Dept. of Commerce.
Facts
and
figures of the development and present state of U. S.
Insured Merchant Marine Bonds are used* to support
prediction made of a growing future for and greater acceptance of
these offerings. Mr. Nichols terms these issues as quasi-Government
Government
decries their present higher basis points
bonds;
comparable securities; and opines they should
fering more than 50 basis points
He foresees their
more
approximating
closely
bankers
are
rates and
On
behalf
are
than long term governments.
immediate future, and ultimately
long-term
and
regard such transactions initially
lastly
as
Maritime
the
a
I
ciative
this
of
Defense
members
o
role of
f
in
replace¬
ment program
of
Amer¬
the
ican Merchant
Marine.
is
It
sincere
my
hope that
as a
of
this
result
there
develop a
paper
will
better
under¬
f
the objectives
standing
this
of
L. F. Nichols
o
program,
a
clearer
per¬
ception of the means being util¬
in
ized
achieving
and the creation
the
of
many
program
its
of
on
an
objectives,
awareness
the
part
to
the
ship replace¬
American
of the program
no
Merchant
suc¬
imperative to
An adequate Ameri¬
the
nation.
can
merchant fleet is deemed
sential to the maintenance
of
es¬
our
importance is recognized
less
an
authority than
Kennedy, who,
country
strong,
Maritime
think
I
that
Federal
the
contribution
to
their
and
.
.
Thursday, December 28, 1961
em¬
the
take
Thus,
it is
on
the highest
au¬
istration
recognizes
major functions to be
tenance
of
of
one
its
the main¬
modern,
efficient,
action
foreclosure
and
advice
and
dynamic force
influencing
our
at
our
service
work
economy,
ren¬
daily
and
economic trade relations with
other nations of the world.
economy
estimated at $5.3 billion
as
amended, is a comprehensive
Congressional enactment designed
foster
to
the
development and
encourage the maintenance of an
adequate
and
well - balanced
American Merchant Marine, both
billion
several
to
the
economy,
customer
of
dollars
is
an
annually
important
American farms
and
further
this Committee
1946,
operating subsidy
costs paid out by the government
has been offset by Federal in¬
come taxes paid in
by the ship¬
study
of
has also indicated that since
85%
of
net
Construction-Differential
Sub¬
equalize the
positions of American and foreign
shipbuilders.
sidies,
The
designed
to
Mortgage
Federal
Insurance
Program
will
remarks
deal
more
tax
dollars
Title
originally
policy for financing ship
construction, reconstruction and
reconditioning.
Title
XI
authorizes
generally
the insurance of loans to provide
funds during construction of up
of the actual cost of ves¬
to 75%
sels
determined by the Secre¬
as
tary of Commerce and ship mort¬
after the ships
of up to 75%
gages,
pleted,
cost
in
or,
without
construction
subsidy
and meeting
-
of
differential
certain
cost.
up
erally run up to 25 years for all
ships except tankers and other
liquid bulk carriers which have
a
limit of 20 years.
The 1954
amendment
provided for 90% in¬
and mort¬
of these loans
surance
However, since the risk of
the
uninsured
portion was not
acceptable to lending institutions
—which required the equivalent
gages.
cash
sured
collateral
as
companies
was
further
a
the
for
—
the
90%
eliminated in 1956
move
"to
facilitate
enacted in 1938, it did not become
private
significant legislation until
vessels in the interest of national
1954.
financing
merchant
of
Continued
were:
Our Facilities
UNLISTED TRADING DEPARTMENT
INSTITUTIONS
are
Available
BANKS
•
PENSION FUNDS
on page
•
•
to
CORPORATIONS
INDIVIDUALS
•
DEALERS
&. Co.
Exchange
5
unin¬
and thereby im¬
additional burden on the
portion
MUNICIPAL AND FOREIGN SECURITIES
YORK
re¬
to 87%% of actual
Mortgage maturities gen¬
quirements,
tf/ndebmu/eM and
NEW
com¬
actual
of ships built
case
a
are
INDUSTRIAL, RAILROAD, PUBLIC UTILITY
oKCembers U^ew York Stock
ne¬
ernment
limitation
was
avoiding the
under Title XI has been the gov¬
particularly with Title XI of the posed an
Federal Ship Mortgage shipping
While this
and
cessity for substantial appropria¬
tion of government funds. Since
1954 the insurance by the United
States
of mortgages
and loans
Act—the
Insurance program.
conserving public
gram—thereby
of
My
The chief drawbacks
Wertheim
ac¬
is
annually. cept government debentures in
lieu of cash in payment of insur¬
dered over the past several years The contribution of seagoing and
operations
and
ship¬ ance; and
by a number of highly respected shoreside
(3) Provisions excluding con¬
members of the banking and in¬ building activity alone can be set
struction
loans
on
ships to be
vestment
industry. Were it not at $2.8 billion a year. Earnings of
used in foreign trade.
for
their support,
and personal all employees in the American
In 1954, however, the Congress
advice to those of us in the Mari¬ Merchant
Marine,
including
time Administration who are re¬ shoreside and shipyard workers, amended Title XI in its entirety
sponsible for administering this amount to more than $1 billion "to facilitate private financing of
ship
construction."
The
Another estimated $1 new
program, it is doubtful that we annually.
billion in earnings is generated by amendment was the culmination
would
have
progressed to
our
the domestic movement of foreign of the efforts of the shipping in¬
present posture.
trade cargo — for warehousing, dustry
and lending
institutions
In order to adequately appre¬
truck
and
rail
movements
and working
in
close
collaboration
ciate the ultimate
benefits
ac¬
other handling—aside from ship with the executive and legislative
cruing from the financing pro¬
loading and
voyage
movement. branches of the government. This
grams to be discussed, it would
These
few
salient
facts
clearly enactment, as well as subsequent
appear helpful to bring into focus
reflect that the American Mer¬ amendments, recognized the size¬
the greater national interests be¬
chant
Marine
is
an
important able ship replacement program
ing served by these programs both
American industry and the pro¬ facing
the American Merchant
directly and indirectly.
An ap¬
and
the
tector of our priceless lifeline of Marine
importance of
preciation
of
these
interests
trade with the rest of the world. providing private rather than gov¬
should lead to the conclusion that
The Merchant Marine Act, 1936, ernment financing for such pro¬
the American Merchant Marine is
recognize the constructive pro¬
fessional
programs
which
are business, and is a substantial tax¬
adopted by future Congresses will payer. Our foreign trade provides
direct employment for approxi¬
and
should
take
this
into
ac¬
mately 4.5 million Americans and
count."
indirectly benefits all workers. A
thority that the Maritime Admin¬
(1) Unworkable interest pro¬
visions;
(2) Requirements that lenders
.
total
Marine's
Merchant
The
outset, permit me
very
maritime
to the
the
Day
should and can have a
vigorous merchant ma¬
foreign trade and commerce, vital
stability of the Free World.
At
ping companies
ployees.
.
Not since Colonial days have
American economic strength and
Proclamation, called the American
for commercial and national de¬
depended so much on
Merchant Marine "a major factor survival
fense purposes.
As one means of
ties with the outside world, and
in
maintaining the economy of
carrying out such purpose, Title
the
nation through serving the the principal commercial link in
XI of this Act authorizes the in¬
ties
is
provided by our
oeacetime commerce of the United these
surance by the Secretary of Com¬
American Merchant Marine. Fast,
States," and "American-flag ship¬
merce
on
behalf of the United
modern
merchant ships are es¬
ping essential to the defense of
States
of
ship
mortgages
and
this and other nations of the Free sential not only to our military
loans made to finance the con¬
but
to
our
economic
World and to the cause of free¬ strength
strength as well, and this factor struction, reconstruction and re¬
dom on every continent."
conditioning
of
ships.
Other
is
highly significant in main¬
The
importance of U. S.-flag
related
promotional
programs
merchant ships is recognized also taining our position as the lead¬
embraced within this Act are:
by Secretary of Commerce Luther ing power in the Free World.
Operating - Differential Subsi¬
H. Hodges, whose efforts on be¬
Generates Billions of Income
dies, designed to place qualified
half of increasing this country's
Research
conducted
by
the operators of U. S.-flag ships in
exports are, I am sure, known to
essential foreign commerce on a
all investment bankers.
But ex¬ Committee of American Steam¬
parity with their foreign - flag
ports and imports require ships, ship Lines indicates that our mer¬
and
in
this
regard
Secretary chant marine employs more than competitors through the payment
of part of their operating expenses
in
Hodges has said: "I believe this 200,000
seafaring,
shoreside
country needs and I believe this and shipbuilding jobs, contributes (principally wages).
National
his
rine.
Marine makes the continued
cess
of
present.
The importance of
ment
by
of the world.
a
Posture
President John F.
in
private
investment
the
to
the
IBA
This
appre¬
opportunity
project.
Essential to Economy and
Ad¬
with
discuss
the
indeed
am
as a com¬
government guaranteed
ministration, U. S. Department of
Commerce,
Investment
governments.
warned not to adopt an attitude of relying solely upon
venture
of
over
not yield at of¬
advised to develop a supply of capital at reasonable
Title XI insurance but to
mercial
differential
now
being priced somewhere between long term govern¬
ments and AAA corporates in the
U. S.-flag ships on the trade lanes
to
Merchant Marine
more
Chronicle
The Commercial and Financial
Harriman Ripley & Co.
Incorporated
63 Wall
BOSTON
•
Street, New York 5, N. Y.
CHICAGO
CLEVELAND
•
•
PHILADELPHIA
DETROIT
•
•
PITTSBURGH
SAN FRANCISCO
•
READING
London Correspondent: PHILIP HILL, HIGGINSON, ERLANGERS LIMITED
72
Volume 194
Number 6120
.
.
The Commercial and Financial Chronicle
.
poration
Report of IB A Foreign
Investment Committee
Arthur
and
nations
INTRODUCTION
report
last
eign
year
we
re¬
investment
for
technical
investment bankers and investors
covering
period
com¬
mencing
with
the
the
end
World
1
sound
eco¬
In
of
tabu¬
which
are
ings
B.
We
peat here the
historical
in¬
report,
A.
L.
Wadsworth
in
wish
do
we
last
year's
to
confirm the conclusions which
set forth in that
of
sion
"We
report.*
position, we
basic conclu¬
year's report as
should
like
Committee
to
state
fully
that
supports
those fiscal, monetary, wage, price
and international policies (includ¬
ing export promotion and greater
sharing of our defense and aid
burdens) which are essential to
provide a sound balance of pay¬
ments
relationship
United
States
between
the
and
the
other
na¬
should
steps
be
balance
believe
which
taken
of
to
there
can
and
correct
our
payments
position
without discouraging private for¬
the
peared
15,
text
in
the
of
1961
last
year's
"Chronicle"
Report
of
ap¬
December
Annual
The
of
and
several
Meeting
in
World
Bank, The
International Monetary Fund and
International
Finance
meetings
has
two
members
Cor¬
of the most
was one
man
chair¬
your
attended.
Seventyrepresented
by over 600 government officials
including in most cases the prin¬
ever
were
cipal financial officer of the
re¬
spective member governments. In
addition, approximately 300 "spe¬
cial
guests"
representing many
of
the
leading private banking
firms in
the
the
free
meetings.
this
centered
At
the
year
and
success
international
since
their
War II
creation
and
eminent
striking
achieved by
institutions
after
World
position which
they
oc¬
in the free world today.
cupy
on
policies,
world
attended
the
meetings
greatest
on
in¬
been
the part
States
The
has
United
States
foreign invest¬
monetary
problems
including proposals
"balance
The first
still
of
matter
Throughout
been
not
coun¬
tries.
The formal
number
which
of
meetings included a
addresses
stimulating
were
widely
financial
press.
reported
Mr.
in
Robert
solved
and
is
a
continuing
concern.
the year there have
recurring
in
ances
political disturb¬
various
parts of the
world and these have had
effect
verse
on
factor which is
so
the
an
ad¬
confidence
vital to private
foreign investment.
On the other
hand
there has been continuing
rapid growth in the free econom¬
ics of Western Europe and Japan
and growing
confidence in the
of the European
success
Common
plan which is of
the
to
vital
(the
program
par¬
investment
vide
write
"all
risk"
be
can
made
to
work
limited way it will pro¬
a
new
recommend
ects
which
that
should
qualify for this
surance
guaran¬
econ¬
members
be
able
to
"all risk" in¬
new
program. Only
the
can
possibilities
in this way
well as
as
the problems in this new field be
explored.
The
mutually
advantageous.
results
should
be
The second program
consists of
plans to provide com¬
prehensive
guarantees
against
both
political
and
commercial
two
projects furthering social progress
the development of small busi¬
new
risks
The total fund available for
risk"
neces¬
I.B.A., working with their
industrial clients, develop proj¬
normal business
losses.
These
special
cases
are
limited to high priority projects
in high risk areas among the less
developed countries — principally
or
provide the
the
We
including
ness.
to
of the
addition, and of more impor¬
tance, AID is willing in "special"
to
institutional
States
agement in developing the
omies of these nations.
contract by a foreign government.
tees
great
to en¬
opportunity to demon¬
advantages of private
capital and private business man¬
a
strate
new
In
cases
in
even
new
national
"all
Market.
which
insurance is limited to
have
recently
Continued
on
been
page
132
The first two developments cre¬
ated
noticeable
a
reluctance
of
bonds
industrial
AID
too
are
guarantees
United
cases
surrection and serious breaches of
is
dollar
main
en¬
risks
such
sary leverage for the equity in¬
vestors in new enterprises. If the
lem
We
the
be¬
was
tice
Expanded
inconvertibility have been
broadened to cover revolution, in¬
resources
increase, if necessary, the
at its disposal by spe¬
standby credit arangements
year
The
without
offered in
payments" prob¬
lem. As the year ends, this prob¬
Fund to
Monetary
the
States
of
make
International
the
As
tions.
Foreign Investments Guarantee
is
United
ob¬
lenders whose support is in many
interest
activities.
be
in
interesting
private
capital for financing new enter¬
prises in the less developed na¬
past.
bankers
the
cannot
problem
positive steps to en¬
participation of private
capital in foreign lending by sup¬
porting such credits with broader
and
potentially
more
effective
varying effects
gan
insurance
This program though limited in
taken
ticular
ment
100%
cover
size and scope, recognizes a basic
courage
the
be used alone to
the investment where the "all
risk"
Government
guarantees than it has
on
tained.
eign investment in the future.
by conflicting currents in
on
of
more
than 50%
more
can
govern¬
mental and international agencies
should foster private for¬
international economic and politi¬
cal developments which have had
interest
believe
increase in the
institutional
of
that
inves¬
investments in
new
foreign
certain
issuers.
foreign
enterprises, both public and pri¬
vate, have not been able to ob¬
tain funds
through the sale of
their bonds in
our
Investment Securities
markets—funds
which
they desired and which
they might have been able to ob¬
tain
several years
ago
in outf
Underwriter
Distributor
•
opinion.
Garner's final report as President
of The International Finance Cor¬
I960.—Editor.
terized
United
(and
commonly
equity in¬
vestments), and to not more than
$10,000,000 per investment. The
specific political risk guarantee?
not
equities.
have
developments
both
investment
which
ex¬
tribute to the pre¬
a
tors to
by
the
*Full
was a
European
States
there
ed
with
many
meeting
of
United
and
cial
are
bankers
in
addition
its
lieve, however, in private foreign
we
In
and
the coverage in limited to a maxi¬
mum of 75% of the
equity or loan
Euro¬
gaged for the first time in many
in widespread discussion of
tions of the world. We firmly be¬
and
equities
in
years
impressive
one
last
investment
in
chairman
The
follows:
the
representa¬
private
investors
members of the committee attend¬
poration. This
payments
repeat
from
private
pean
States
program of
Agency for Inter¬
Development).
Under
this plan the former ICA guaran¬
tees
against war, expropriation
we
particular, in view of the
continuing concern about our bal¬
ance
forth
re¬
In
want to
set
Vienna
included
but
is
Your
re¬
formation
invest¬
obtained at these meetings is in¬
corporated in this report.
Appendices A
not
foreign
Appendix C
and certain pertinent information
up-to-date in
this report in
shall
with
ment. The Agenda of these meet¬
brought
and
United
present.
these
During the year the Committee
two meetings including one
at the Spring Meeting of the I.B.A.
concerned
certain
the op¬
Washington, D. C. this fall con¬
Foreign Investment Developments
ferring with the principal gov¬
In 1961
ernmental agencies and interna¬
The
tional
institutions
which
are
past year has been charac¬
1960.
lations
the
is earmarked for housing guaran¬
tees in Latin America. In addition
during the summer
early fall but our members
report a strong resumption of in¬
terest recently on the part of both
several
government
$100,000,000, of which $10,000,000
reduction
some
and
between
and
increase during the
was
interest
vestors
ample of the
Committee
last May.
A sub-committee spent a day in
that report
included
we
the
for
in
an
There
year.
discussions of mutual problems in
field of international finance
This
held
~
War II
through
of
were
has shown
the
viewed
Activities
management
ability are even
important than money in
achieving economic development.
nomic development."
the development of for¬
eign investment by United States
that
more
tives
our
in
Equally important
portunities afforded
L.
Wadsworth, Vice-President of Dillon,
Read & Co., Inc., New York
City, in his capacity as
Chairman of the Foreign Investment
Committee,
presented the following Report to the Convention.
In
outstanding for his
advising the devel¬
was
frankness
oping
21
Meanwhile interest in the pur¬
chase
of foreign equity
Dealer
securities
Corporate Bonds
Common and Preferred Stocks
Mutual Funds
Equipment Trust Certificates
State, Municipal and Revenue Bonds
New
U. S. Treasury and Federal Agency Issues
Hill, Darlington & Grimm
Members New York Stock
And Other
Housing Authority Bonds
Exchange
Leading Exchanges
Eastman Dillon, Union Securities & Co.
MEMBERS
15 BROAD
STREET, NEW YORK 5, N. Y.
660 MADISON
2
Broadway,
New York 4,
N. Y.
HA
NEW YORK STOCK EXCHANGE
AVENUE, NEW YORK 21, N. Y.
5-6200
BALTIMORE
•
ESCONDIDO
•
NEW HAVEN
BOSTON
CARLISLE
•
HARTFORD
PATERSON
•
SAN DIEGO
•
•
CHICAGO
LAS VEGAS
•
PHILADELPHIA
•
SAN MARINO
CLEVELAND
•
LONG BEACH
•
•
READING
SOUTHERN PINES
•
•
•
EASTON
LOS ANGELES
•
•
REDLANDS
VENTURA
Correspondents in
ANDERSON
•
KANSAS CITY
COLUMBIA
•
•
DALLAS
MONTREAL
ROANOKE
•
•
•
FORT WORTH
NORFOLK
ST. LOUIS
•
•
GREENVILLE
•
PITTSBURGH
SHAMOKIN
•
•
TORONTO
•
ITHACA
RICHMOND
Kfi/TM
22
The Commercial and Financial Chronicle
Committee, 1960; and
Backgrounds of the New
Principal IBA Officers
of officers elected at the Convention on
Nov. 30 included a new President and
five VicePresidents, three of the latter being named for the
second consecutive term.
The official biographies
of each of these officers follow:
H.
BINGHAM
in
ness
Los
primarily
President-Elect
to
Newton, Part-
G.
H.
Co.,
Louis, Mo.
n e r
St.
Mr.
devoted
business
nance
and for
almost
40
He
was
born
ceived his B.S.
gon
(1898)
and
he
was
Upon
Mr.
employed
by
Southern California Edison to sell
dustry;
the
Southern
National
tee,
tric
curities
Two
company.
years
held
other
District Chairman of
was
to investors the stock of that elec¬
utility
has
Bingham
positions of leadership in the in¬
California Commit¬
Association of Se¬
Inc.; was Gov¬
Dealers,
ernor
derwriting and distributing busi-
Chairman
of
1958-60;
NASD,
the
of
later he entered the securities un¬
NASD
the
Finance
close to South Pasadena.
DAVID
J.
HARRIS
David
ton
the Asso¬
today, the capital re¬
quirements of American industry run to staggering
firms
can
For
lenge
challenge in financing that few
—
1953-55, and Governor of the
Stock Exchange, 1959 to
the present. He has also been a
member of the Chicago Board of
Trade since 1956. Mr. Harris is on
ers,
Midwest
1958
the
he has been
a
trustee
and
fraternity
(Bir¬
Cato
Stores
(Charlotte, N. C.).
(Augusta).
Manufacturing Co.
Riverside Mills
Hanna
(Athens).
Co.
Art Metals
American
(At¬
lanta).
Inc.
Radiation,
Fla.).
(Melbourne,
Airpax Electronics,
Lauderdale). ;
For
than
more
Inc.
25
(Fort
Mr.
years,
Johnson has been active in Asso¬
activities
ciation
at
both
the
na¬
tional and group
first
his
term
levels. He served
as
Vice-President,
was
Chairman
1960-61,
of
the
Southern Group, 1943-44, and has
served on the following national
committees:
State and Local Taxation Com¬
mittee, 1934-38;
Placement
Private
Committee,
1938-39.
Highland Park Hospital.
Convention
Com¬
Attendance
member¬
to
work
a
Sills, Min& Co.; he
became
utive
Harris
Mr.
former
Evelyn R. Carr. They have
family lives in Highland Park, 111.
1944
He
i
n
as
tic
Johnson, Lane, Space & Co., Inc.,
Savannah for
Savannah,
In 1947 he
was
Vice-President
A
organi¬
David J. Harris
native
of
Georgia,
Mr.
Johnson
at¬
re-elected
as
a
of the Association.
,
then
he
has
been
He
1948 Mr. Harris has
active in
the
activities
of the
his
B.A.
Group and national
Association.
first
the
been
term
was
He
Vice-
as
Gover¬
a
Association
from
1956-59, and has served on the
following national committees:
Education
Committee,
Industrial
Securities
1948-51.
Commit¬
tee, 1952-55.
then
came
on
be¬
of
the
Committee. For his services
to the
Georgia Ports Authority he
received the
ington
and
ness
through
has
numerous
Thomas M. Johnson
area:
the
Johnson, Lane,
Space & Co., Inc., and has served
since
that time. Mr.
he
civic
in
Busi¬
Mr.
years
active in
very
and
charitable
the
Savannah
Red
for
Cross
both
Fund
(1945) and the United Com¬
munity Services
1957
Wash¬
for
Chairman
was
American
Drive
the
been
organizations
In 1933 he formed
Award
and Industry.
Down
vannah, Ga.
William
1961
Gordon
Johnson
and
President
this Commission. Gover¬
nance
tional Bank in
as
years.
awarded the Lucus
^ear term in 1959; he serves the
Authority as Chairman of the Fi¬
de¬
later in Sa¬
number of
a
was
member
a
Na¬
Augusta
Supply Commission in
appointed
Georgia
State Ports Authority for a three-
ated with The
Citizens
Chair¬
Vandiver of Georgia
him
associ¬
Southern
as
Trophy for the most outstanding
service
performed for the city
during that year because of his
work
1921.
in
gree
Chicago.
of
his
Water
nor
received
he
a
Co.
served
of the Industrial and Domes¬
man
Thomas M. Johnson, President of
suc¬
Since
Committee,
Industry
Johnson
Mr.
Vice-President
P resident
its
59.
1957-59.
con-
tinu ed
Com¬
mittee, 1955-60; Chairman, 1957-
THOMAS M. JOHNSON
and
President
mittee, 1953-55.
Public Utility Securities
Nuclear
Exec¬
Vice-
1945.
the
to
daughter and two sons and the
President
in
Public Service Securities Com¬
married
is
Group Chairmen's Committee, Johnson is a director of the fol¬
1955-56; Chairman, 1957-59.
lowing companies:
meet.
one
Vice-
Chairman, District No. 8, Nation¬
1935,
Harris
went
for
nor
a
business:
DeBardeleben Coal Corp.
during the winter.
in
cago
of
Following his graduation
President, 1960-61,
amounts, present
in
organizations
al Association of Securities Deal¬
Club
Vice-President
ciation.
in
envy.
often
investment
(Savannah).
mingham).
versity of Chi¬
Co.,
a
served
more
other
in
ership
Harris, Partner, Bache
Chicago, was re-elected ships
Resident Partner of Bache &
reputation to
v.V:;:';/:::
Railway
from the Uni¬
&
Since
and
States
Group in 1955-56 and for several
was
a
member
of
the
Group's Executive Committee. Mr.
Harris has held positions of lead¬
the
(Savan¬
mittee, 1939-40; 1941-42.
include: Exmoor Country
Federal Legislation Committee
Club, University Club (Chicago), 1940-41; 1948-51.
and Delta Kappa Epsilon.
His
Group Chairmen's Committee,
hobbies are golfing and curling
1943-44.
1956.
"one of the leaders
more
was
Sills,
tended the
Fairman & Harris, Inc., and FairUniversity of
man, Harris & Co., until the latter
Georgia where
merged with Bache & Co. in May,
rr
Because
he
Central
the
of
level
years
Since
J.
cessor
a
regional
Chairman
of
zations,
underwriting, that's
the
School Board, 1954-57, and chair¬
manship of the Highland Park
Community Chest Drive in 1958.
Vice-President
with
In the field of
Nominating Committee, 1958-59.
Mary Decker of Brazil, the Board of Directors of the
Ind., and they reside in South Liberty
Loan
Corporation
and
Pasadena, Calif.
The Binghams Colonial Acceptance Corporation.
have two married sons, a married
His activities in local civic af¬
daughter and 10 grandchildren, fairs have included membership
all of whom live in communities on the Lake County District 107
Mr.
Nominating Committee, 1958-59.
re¬
degree from Ore¬
State College in 1921.
graduation
Committee,
(Chairman), 1958-59.
Rockford, 111.
Mr. Bingham is married to the
South Atlantic Gas Co.
nah).
The Central of Georgia
former
as
Committee
Arrangements
Curtis H. Bingham
in¬
has
1957-58.
banking
the
Committee, 1956-59.
Committee, 1956-
Membership
At
transcend
ity and Alpha Zeta honorary fra¬
ternity.
was
elected a
for
two
terms,
1957,
President
Finance
Thursday, December 28, 1961
1957.
of
the Associa¬
1953-58.
Group Chairmen's
industry.
in
since
-
He
tee,
years has been
in the invest¬
ment
Governor of
a
past
at
level
1959-61, and served on the fol¬
lowing national committees:
Investment Companies Commit¬
fi¬
to
been
Vice
ca¬
reer
decade.
the
tion
entire
his
business
both the national and Group
Bingham
has
actively
has
during
Club
member of Beta Theta Pi fratern¬
securities
the
served
,
Walker &
Los Angeles.
His interests
He
Bond
sold
and
H. Bingham, President of
In 1933 he organized his own
Bingham, Walter & Hurry, Inc., firm, Curtis H. Bingham and Co.
Los Angeles, was elected Presi¬
in Los Angeles, which in 1940 be¬
dent
of
the Association
as
the came
Bingham, Walter & Hurry,
successor
t o
a partnership subsequently incor¬
porated in 1951.
Mr.
Bingham
the
of
institutional
Curtis
A.
1957-58.
member and past president of the
Oneonta Men's Club of Pasadena;
and individual investors.
George
IBA,
President
Chair¬
Group of
is a past
was
California
is a past member, Board of Di¬
rectors, Society for the Prevention
of Cruelty to Animals; member of
the Board of Directors, National
Travelers Aid Society. He is a
Angeles
bonds
the
vestment business and he gives
freely of his time to civic affairs:
The slate
CURTIS
of
man
the
.
.
.
he
has
(1956-57); since
been
Treasurer
thing, it takes capital to meet this chalmany
millions of dollars.
NEW YORK
CHICAGO
For
another, the underwriting firm has to main¬
MONTREAL
LOS
tain
large and experienced staff
a
soned
personnel to
cope
with
—
any
enough
problem that
might arise in its Buying, Syndicate,
or
Sales
ANGELES
WESTWOOD
sea¬
BEVERLY HILLS
PASADENA
SANTA BARBARA
underwriters and distributors
LA JOLLA
NEWPORT
SAN
Department operations.
BEACH
FRANCISCO
PALM
RANCHO
SPRINGS
SANTA
of investment securities
FE
PHOENIX
TUCSON
For
a
BOSTON
third, it demands unusually extensive facili¬
ties for proper
ensure
both the
distribution,
a
HARTFORD
MANCHESTER
proved ability to
WATERBURY
MIDDLETOWN
geographic and numerical sales
BRITAIN
NEW
research and
advisory service
SPRINGFIELD
coverage
called for
on any
given issue.
PITTSFIELD
BUFFALO
ROCHESTER
GENEVA
These
that
are
over
just
some
of the
the years we
reasons
why we're pleased
JERSEY
CITY
GARDEN
CITY
DALLAS
have
come
to be reckoned
HOUSTON
SAN
as
ANTONIO
"one of the leaders".
DETROIT
MINNEAPOLIS
LA
CROSSE
SARASOTA
I
SHEARSON, HAMMILUCO.
"the
firm that research
built"
TAMPA
DUNEDIN
Founded in 1902
JACKSONVILLE
H MERRILL LYNCH,
PIERCE, FEIMNER &
MEMBERS NEW YORK STOCK
70 PINE
BASLE (Switzerland)
leading Stock and Commodity Exchanges
SMITH INC
EXCHANGE AND OTHER PRINCIPAL STOCK AND COMMODITY EXCHANGES
STREET, NEW YORK 5, NEW YORK
Members New York Stock Exchange and other
and
Volume 194
Director
nity
the
of
Services.
Number
United
In
currently serving
6120
Commu¬
addition,
he is
President of
as
.
.
The Commercial and Financial Chronicle
.
nance
Committee,
Council, and is
the Bethesda-Savannah Children's
An
chusetts
also
Savannah
child
and
care
work
Chatham
in
County;
Professional
member of the Board of the Union.
in Boston.
Society of Savannah (President*
1948-54); and Chairman of the
clude:
Finance Committee for the
Crip¬
pled Children's Society.
of
General
Director
a
and
England
of the
Commerce.
Hospital,
of
he
is
Somerset,
American
Myopia
Boat
and
Club
Mid
—
Hunt,
all
Ocean
of
He
is
Club,
Club
They and their four children live
(President,
1945-46);
Sa¬
vannah
Yacht &
County Club
(Commodore, 1953-55); Century
Club; Society of Colonial Wars;
and Kappa Alpha
Fraternity.
in
married
to
Powers
the
of
Wenham, Mass.
JAMES
D.
Kemble, Partner,
&
Co., Boston,
was
Vice-President
Association.
A
native
H.
of
of
the
Wash¬
Kemble
ties
A
to
of
ton
in
Vice-Presi¬
a
Since his
af¬
at
the
national
group
as
Presi¬
Di-
of
tors
Active
in
affairs
the
served
Chairman
as
England
of
the
1952, Mr. Kem¬
the
of
Group,
1953-54,
Governor 1954-55, and on the fol¬
lowing national committees:
Railroad
Securities
Committee,
has
served
Committee,
Committee,
Bond
as
Review
Com¬
the
is
Governor
a
Stock
Boston
a
1944-45;
Taxation
the
of
Group
54
&
Fi¬
Convention
Committee,
Chairmen's
1945-46.
Committee,
Municipal
daughter
ristown
the
has
been
civic
and
active
Hospital
in
and
other
charitable
local
affairs
will
hue
hold
their
25-30,
51st
nounced
Walter H. Steel
ernors
White
at
that
will
the
has
also
Board
of
meet
Sulphur,
Santa
The
the
May
and
dispel
Federal
states
and
needs
of
pamphlet
our
also
Federal
chil¬
noted
v
$290
result
in
high
a
degree
of
Fed¬
eral control."
an¬
interested
this
of
copy
may
most
obtain
Attendance
Securities
by
in
writing
Bankers
19-21
425
Barbara.
to
the
Association
Thirteenth
Investment
of
America,
St., N. W., Wash¬
ington 4, D. C.
Com¬
reasons
Commit¬
for
trading
with
Committee,
Committee,
1957-
Acts
Com¬
Municipal
Kidder,Peabody
A major name in the
Division Council
1958-59; Ex Officio,
underwriting field
1959-60.
Committee, 1959-60.
Committee
on
for
Municipal
A
Public
(Chairman), 1959-60.
He is
a
large,
rienced
Secu¬
expe¬
Trading
Department
member of the Munici¬
pal Bond Club of New York and
Active primary
a
wide
range
corporate
trading markets in
of
stocks,
common
bonds,
preferred
stocks
and convertible securities
A
complete service for Banks and Institutional Investors
UNITED STATES GOVERNMENT and AGENCY SECURITIES
A wire
system to 31 offices and
correspondents
coast
for broad dealer and
to
coast
institution¬
al coverage—at less cost
MUNICIPAL BONDS
experience
Long
OFFICES:
blocks
HIGH GRADE CORPORATE BONDS
Boston, Mass.
without
in
handling
disturbing
large
existing
street markets
Chicago, III.
OVER-THE-COUNTER STOCKS
Philadelphia, Pa.
San
Overseas
Francisco, Cal.
Buenos
New York Hanseatic
Corporation
Established 1920
NEW YORK 5, N.
Y.
Telephone: WOrth 4-2300
Teletype: NY 1-583 and NY 1-40-1-2
in
Paris,
Aires
and
Hong Kong
DIRECT WIRES TO:
120 BROADWAY
offices
London,
FOREIGN SECURITIES
Atlanta
New Haven
Boston
Philadelphia
Chicago
Pittsburgh
experience
Cleveland
Portland, Ore.
Manager, Dealer Relations Department.
Dallas
Providence
Houston
San Antonio
Los
San Francisco
Angeles
Louisville
Toronto, Canada
No
matter
what
can
your
help.
trading
Call
or
problem
write
may
David
D.
be,
our
Lynch,
~
Kidder, Peabody & Co.
Founded 1865* Members New York, American, Boston,
Philadelphia-Baltimore, Midwest and Pacific Coast
*20 Exchange PI., New York 5 • Boston
Philadelphia
Chicago
Los Angeles
San Francisco
Stock Exchanges
a
informative
booklet Federal Aid to Education?
Gov¬
Sept.
the
the
that Federal aid to education will
the
9-12
of
cry
to
debt
is now
billion and rising, as
compared
with
$66
billion for
states and local municipalities.
In its conclusion, the booklet
states
"one
can
only conclude,
that this report dispels any doubt
about
Those
Association
tends
that
classroom
that
at
and
Associa¬
The information
municipalities are not meet¬
ing their obligation in fulfilling
annual
1962
six
local
for
the
Nov.
first
Bankers
therein
Government
years.
The
Securities
Chairmen,
rities
C.
Investment
tion of America.
contained
Memorial
school
the
mittee, 1958-59.
Director
D.
the
wood, Fla.
Membership
Information
in
a
three
member of
a
1958.
Savings Bond Committee, 1952-
Hospital
and
in
in
by states and local
municipalities. This significant
fact and many others are pointed
out in a brochure published
by
in
have
sold
were
1956-57.
Special
Children's
and
$1,410,000,000
bonds
months of 1961
Hollywood Beach Hotel in Holly¬
Chairmen's
Group
Research
a
J.,
1958-59.
Nominating Committee, 1952-53.
(Chairman, 1953-54).
live
Steels
H.
N.
tee, 1948-49; 1957-60; (Chairman),
Federal
Mr. Lemon has been
of
Walter
School Needs?
Over
mittee, 1940-42.
1948-49.
Exchange
Bank
Committee,
Legislative Committee,
1953-54.
Education
Exchange Firms. He serves
member
the
Federal
of
and the Association of New York
of
Able to Finance
New
committees:
1942-53.
mittee, 1956-57.
Kemble
Lemon
Mr.
Group,
1948-49,
Governor, 1951-54, and on the fol¬
lowing national committees:
1953-54.
Administrative
1942,
Chairman
in
The
the Board of Trustees of the Mor¬
tion
Vice-President, 196061, was Chairman of the New
York Group, 1956-57, was a Gov¬
ernor
from
1957-60,
and
has
served on the following national
Southeastern
1953-54.
Savings
since
Federal
Chairmen's
James H. Lemon
number of other corporations.
Active in the affairs of the As¬
1953-1958.
Group
Fund,
sociation
Club
Are Local Units
mem¬
and
the Bond Club of
grandchildren. He is
both
first term
Association since
Street
Club
York,
Chicago.
His hobby is fishing and he is
an active member of the
Anglers
Club of New York, the Brodhead
Fly Fishers, and the Parkside
Anglers Association.
and
meeting
af¬
his
1951.
Bond
The Investment Bankers Associa¬
ac¬
served
William T. Kemble
Wall
the
Nov. 25-30, 1962
Asso¬
in
1946-47.
a
IBA Convention
a
fairs
organ¬
Inc., and D. C.
Paper Mills, Inc.; Chairman of the
Board, American Mercury Insur¬
ance
Co.; and a Director for a
as
been
from
dren.
the
cessor
worked
Stock
became
and
a
of
many
1946
ciation
to
both
in
Co.
and its prede¬
Washi ngton
Mr.
&
tive
Co.
rector
1925 gradu-
the
of
has
ohnston,
&
a
University of
Chicago. He
joined Drexel
dent
prior
college. He
ber
1940 Mr. Steel
with
Mutual Inves-
ble
Mr. Steel is
following
year.
Since
Lemon
in 1933
New
Vice-President of the Asso¬
a
ate
1925,
been
STEEL
H. Steel, Partner, Drexel
Co., New York, was re-elected
returned
in
York
Vice-President
partner
where he had
firm
New
President
married
He
became
in
WALTER H.
levels.
partner in the
former
they have
its
addition, Mr. Steel is
The
and
Co.
the
and
business
-
Estabrook
&
banking
City.
izations. He is
of
to
who is in the investment
son
Vice
Harvard
Class
he
married
1934,
the
City
one
ciation.
Prince-
Lemon
business.
member
Federal
McGehee
and
J
securi¬
elected
was
filiated
his
career
the
is
graduation
has
in
He
from
Mr.
entire
the
a
Martha
as
LEMON
Lemon, Partner, John¬
Lemon & Co., Washington,
C.,
Mr.
spent
In
also
Walter
dent of the Association.
ington, D. C.,
has
was
is
Trustee, Princeton University.
&
ston,
Vice-President
a
its Presi¬
Council; Secretary and Trustee,
Group Hospitalization, Inc.; and
Boston.
James H.
WILLIAM T. KEMBLE
elected
of
as
He
former
Vice-President
Estabrook
1948-53.
Morristown,
Madeleine
T.
from
Bermuda.
Club, professional, and fraternal
memberships include: Oglethorpe
William
dent
Association
Club memberships in¬
Union
Boston;
the
Football
since 1941 and served
member
Incorporator of the Massa¬
Center, which supervises and ad¬
ministers
all
New
member
a
Boston Chamber
23
24
Report of IBA Municipal
Securities Committee
Alan
K,
Browne, Vice-President of the Bank of
America National Trust & Savings Association, San
Francisco, presented the following Report to the
Convention
in
of
issues
new
state
advisory services to assist munici¬
palities and other political sub¬
would
when all seven bids on $4
million Charleston, W. Va. sewer
revenue
bonds were rejected on
rate
municipal bonds during the first
10 months of 1961 aggregated over
$6.8 billion. Since the sales of new
continued at
,
appears
prob¬
the
that
able
for
volume
the
set
to
at
high enough that only
proportion of municipal
level
a
small
"Reasonable"
an
a
determined
an¬
formula in the law,
principal de¬
velop ments
which fixed the rate for the fiscal
beginning July 1, 1961 at
(or for communities in re¬
development areas at 3%%). The
3%%
legislation af¬
fecting
law still
Alan K. Browne
mu¬
the
der
Report
of this Committee are summarized
nancial
below.
not
Legislation
for
an
The
a
that
an
1961
lation
The
Housing
the
amended
interest
rate
set
the adminis¬
agencies is too low in re¬
to
that
at
and
In
rate
Act
of
to
on
is
a
loan
to
or
is
be
deemed
repayable
more.
the
by
current
market
rate
is
from
other
eligible
sources
under
these
In
August the IBA submitted to
DISTRIBUTION
interest
an
reasonable
3%%, if the
30
years
For shorter terms
loans,
'reasonable'
over
interest
rate
is
to be reduced by %% for each
five-year reduction of the length
of the
loan, provided such interest
rate is not less than 3%%. If the
borrower is
located in an area
designated
redevelopment
the benchmark for reason¬
area,
as
a
able interest rates would be 3%%"
(i.
pro¬
loan to
Charleston on Oct. 19, with the
usual requirement that the bonds
be advertised again in a financial
newspaper of national circulation
and an agreement that the C. F. A.
will purchase all those bonds for
ment
a
redevelop¬
area).
as
"reasonable"
determining eligibility for
in
loan
a
under the Federal program is ob¬
viously
current
too
low
market
in
relation
to
rates, noting that
20-year bonds of the U. S. Gov¬
ernment (the highest credit on a
taxable
to
the
proved
which bids
million
$4
are
not received from
investors
other
on
"reasonable
terms."
It is the policy of C. F. A. to
require that bonds be offered in
blocks of maturities so that pri¬
vate investors might purchase one
blocks
more
or
maturities at
an
yield
the
basis)
over
are presently priced
4%. We believe that
policy of the Community Fa¬
cilities Administration is contrary
to the intent of the law which
specifically provides that the Fed¬
eral
loans
may
be provided only
is not avail¬
when the financing
able
from
other
sources
on
"reasonable terms."
ordered
Kennedy
on
Oct.
26
Federal economy drive
a
and asked
agency heads to
exer¬
cise the maximum
care in tighten¬
ing requirements, postponing the
initiation
of
deferable
projects
and phasing out any acceleration
of spending which was instituted
and instrumentalities in
divisions
the budgeting,
financing, planning,
of
the
services."
This authorization also provides
an
ing
vigorously opposed the
under
and
effectively
more
financial
sional
under
various
pro¬
com¬
IBA
Recommendations
(1) The interest rate determined
"reasonable"
in
establishing
eligibility for Federal loans under
as
the
be fixed
program
consideration
in Congress, through
a
this
state¬
reasonable
rate
would
Shares
Common
eligibility for Federal loans under
the
program
be
than
House Committee
Banking and
Currency when the proposal was
standing obligations of the United
States of comparable maturity.
under consideration by that Com¬
mittee, through letters addressed
(2) The provisions extending the
application of the Community Fa¬
cilities Loan Program to commu^
nities
in
redevelopment
areas
under special terms be repealed
because they create an unnces¬
to
all members
on
of the House im¬
mediately
prior to consideration
the House, and
notice to members re¬
garding the proposal.
It is apparent that, as long as
the supposedly "reasonable" rate
of the proposal in
through
of interest
the
under
is
set at
a
determining eligibility
Federal
level too
tionship to general market rates,
the principal effect of the Com¬
Facilities Loan Program
be simply to substitute Fed¬
financing for financing that
munity
will
eral
would otherwise be provided from
other sources at rates reasonable
in
relation
to
market
rates.
We
current
and
sary
yield
undesirable
The
Housing Act
of
1961
also
the
Community Facili¬
by adding the
following provision:
ties Loan Program
by raising the rate
"Sec. 207. The Administrator is
duplication
Redevelopment Act.
(3)
The
provision
authorizing
Federal advisory services to mu¬
nicipalities in budgeting and fi¬
nancing be repealed.
(b)
Area
Redevelopment Act of
1961
of
The "Area Redevelopment Act"
1961 authorizes the following
principal
programs
qualify
as
of
'
'
-
;
;
-
.•
.
-V:
Underwriters
•
Distributors
•
•
Dealers
Members New York Stock
E. F. HUTTON & COMPANY
E. F. HUTTON
1
CO.
&
American Stock
(1) $100,000,000 in Federal loans
areas
and
to
aid
•
SAN
DALLAS
BAKERSFIELD
BEACH
•
DIEGO
•
SANTA
•
LOS
SAN
BEVERLY
ANGELES
MEMPHIS
•
•
•
•
•
•
ROUGE
•
FRESNO
•
•
financing any project
for industrial or commercial us¬
age.
Such loans may be for a
period of up to 25 years and cover
HOUSTON
•
EL
PASO
WICHITA
ATLANTA
•
•
•
•
SANTA
y ;:
-•
•
r.
•*
'■"
./
i
Exchange
Exchange (Associate)
STREET, NEW YORK 4, NEW YORK
•
•
•
SAN
Telephone
Bowling Green 9-2810
BARBARA
CHICAGO
•
ALBUQUERQUE
LONG
•
PASADENA
•
LONGVIEW
FALLS
CITY
LA JOLLA
•
SPRINGS
CITY
'v -
•
TUCSON
SANTA ANA
•
KANSAS
•
HOLLYWOOD
•
TUCSON
KANSAS
•
•
PALM
SAN JOSE
•
CHICAGO
•
ORLEANS
OAKLAND
PHOENIX
BATON
DALLAS
NEW
HILLS
FRANCISCO
MONICA
ORLEANS
FRANCISCO
•
NEW
ROSWELL
LUBBOCK
•
TYLER
areas
in
York
51 BROAD
LOS ANGELES
$100,000,-
000 in Federal loans in rural
incorporated
Chase Manhattan Plaza, New York 5, New
which
"redevelopment areas":
'?
•.
Federal
areas
'
....
out¬
authorized under the Area
grams
INVESTMENT SECURITIES
.
on
with Federal loan and grant pro¬
loan
program
low in rela¬
the
FAULKNER, DAWKINS & SULLIVAN
Brokers
higher
ment submitted to members of the
Preferred
and
level
a
comparable
maturities
and
types of securities (general obli¬
gations or revenue bonds), which
amended
On
at
for
he could do much to carry out the
President's
order
by restricting
measure.
best
We recommend that:
in non-rural
anti-recession
30
be¬
Federal
grams,
ment.
an
Oct.
profes¬
We
rather than for the
long-term interests of the
munity.
ance
Corporate and Municipal Bonds
as
which
by representatives of the Federal
Government
will
be
designed
principally to qualify for assist¬
the IBA suggested to the
administrator of the program that
'for
y:
the
that much advice furnished
financial assistance in
>
by
advisers.
vigorously protest this unncessary
assumption of private business
function by the Federal Govern¬
.
of
furnish¬
in relation to current market rates
expansion of this program when
was
in
services
professional
lieve
on
other investors.
it
intrusion
Government
would be provided more properly
shorter
maturity. This pol¬
icy is constructive in making it
possible for at least a portion of
many issues to be purchased by
year
unnecessary
Federal
the maximum
The IBA
construction
and
interest rate be¬
low the reasonable rate based
3%% for 30-year or longer
maturities or 3%% for 20-year or
shorter maturities in
to
of
community
facilities. There are hereby au¬
July 31, although the best bid
thorized to be appropriated such
provided a reasonable net interest
sums
as
may
be necessary, to¬
cost of 3.945%, after a representa¬
tive of the C. F. A. present at the1 gether with any fees that may be
meeting advised that the funds charged, to cover the cost of such
e.,
President
the administrator of the Commu¬
reasonable
bond issue secured upon
terms and conditions as
if it does not exceed
programs.
Program
NATIONAL
the
rates, a
large volume of municipal financ¬
ing is unable to obtain financing
additional $50 million was
authorized.
If
"reasonable"
as
authorized
$100 million.
rate.
trative
"reasonable
Act
1955
Federal loan under the pro¬
a
only if they cannot obtain
financing from other sources at
previ¬
program
on
aggregate of
1960
rea¬
on
grams,
ously administered by the RFC,
provides Federal loans to munici¬
palities of community facilities if
the financing is not available from
terms."
available
tratively as a "resonable" rate,
because municipalities are eligible
Community Facili¬
Program, administered
sources
"unless the fi¬
applied for is
program
assistance
otherwise
un¬
rate which is determined adminis¬
by the Housing and Home Finance
Agency,
authorized
under
the
Housing Amendments of 1955 as
other
financial
no
extended
be
Eligibility under either of these
programs depend on the interest
The Federal
substitute for
sources
The rate set
(a) Community Facilities Loan
Program
a
shall
"For
sonable terms."
I
Federal
Loan
provides that
assistance
ties since the last Annual
ties
a
year
nicipal securi¬
from other
government loan,
nually under
Federal
Fa¬
cilities Administrator adopted the
following basis for determining
whether
financing
is
available
the
rate
this
on
might be obtained from his agency
a lower rate. The C. F. A. ap¬
Community
the
same
interest
focused
Attention
gram
at
$8 billion. The
and
Criteria
Unrealistic
the
an
rates
the program.
population not exceeding
150,000). The loans are made at
to
close
market
current
ment). Such loans, except urban
transportation loans, may be ex¬
tended only to municipalities with
a population not exceeding 50,000
(or in the case of a community
situated in a redevelopment area,
a new rec¬
ord,
reasonable
realistic rela¬
terms:
with
will
year
the
a
able
only for loans for urban
transportation facilities or equip¬
a
high level
during Nov e m b e r
it
in
tionship
a
munity facilities except schools
($50 million earmarked as avail¬
have
issues
establish
monthly
financing would be eligible under
additional $500 mil¬
lion for Federal loans for any com¬
authorize
technical
authorized
sonable rate under the program.
However,
and
establish
of interest established as the rea¬
his
of
Thursday, December 28, 1961
.
.
nity Facilities Loan Program a
suggested yardstick for establish¬
ing
"reasonable
terms,"
which
capacity as Chairman of the
Municipal Securities Committee.
Sales
\
The Commercial and Financial Chronicle
Teletype
NY 1-5178
Volume 194
Municipal
Number 6120
Securities
Committee
N.
up
be
met
.
.
The Commercial and Financial Chronicle
(Breakfast
T. & S. A., San
to 65% of the cost of the proj¬
ect. At least 10%
.
of the cost must
in
Meeting)—Alan K. Browne,
Francisco, Chairman
proportion
its
to
Bank
ability
to
contribute.
by funds supplied by the
APPENDIX A
contains
more
a
state
or
non¬
detailed summary of this law.
profit
local organization and at
5% must be provided by
(c) Federal Aid to Education--
least
community
a
Schools
assistance
or
ers
applied for is not other¬
terms,
1961
bill
would
which
have
at
interest
agencies
at
an
determined under
the
in
Federal
other
reasonable
rate
A
in
a
formula
November,
been
$100,000,000 for loans for
Such loans may
have maturities up to 40 years for
the full cost of the project and
will be made, if the funds re¬
quested are not otherwise avail¬
(2)
public facilities.
on
reasonable
terms
at
an
interest rate determined annually
under a formula in the bill, which
presently would be 3%%.
(3) $75,000,000 in Federal grants
public facilities if there is
little probability that the project
Senate
to
$2 billion in Fed¬
grants over the next three
years to assist public elementary
over
eral
and secondary schools, to be used
either for construction of school
facilities
4%.
the
passed
authorize
A
able
bill
similar
the
for teachers' salaries.
or
bill
House
but
Education
held
was
Committee.
the
bill
the
House
reported
was
by
Committee
the
consideration
in
be
without the
undertaken
assistance
of
such
a
grant.
It
under a special pro¬
bypassing the Rules Com¬
mittee failed on Aug. 30 by a vote
of
170
to
242.
Accordingly,
the
proposed Federal aid for public
elementary and secondary schools
was
not adopted this year. The
requesting
tribute
to
the
grant
the cost
of the
vigorously opposed
the
proposed new
of
program
Federal aid for public elementary
and secondary schools on the basis
that educational facilities for ele¬
mentary and secondary schools
are being financed adequately by
state and local governments with¬
out a new
program
of Federal
assistance.
well
(1)
About
rooms
to
school dis¬
tax-exempt
con¬
property
on
which public school
project
children
reside
or
Federal
their
350,000
class¬
new
completed during
the 5-year period 1957-1961.
ary
schools
were
The
(2)
enrollment
rate
of
growth
in
public elementary
schools is decreas¬
official estimates indicating
that
during
the
5-year
period
ing,
1961-1966
past 5
will
school
bonds
sold
during the first six months
of
be
growth
down
in
to
50
is
available
unless
years
"upon
from
terms
equally
giving essential facts
in
1950
originally authorized
revolving fund of $300
million
form
through 1960
has been published by the
Copies have been mailed to
member
at
a
firms
are
and
available
additional
in
quantity
nominal cost. Since this sub¬
ject is the current national high
school debate topic throughout the
country, it is suggested that copies
of
this
booklet
be
given wide
distribution.
(d) College Housing
The
loan
the
Federal
college
housing
administered i by
and Home Finance
program,
Housing
Agency,
lasted
until
billion
was
(e) Mass Transportation
Identical bills introduced in the
..
provide (a) $75,000,000 in Federal
grants
for
mass
transportation
planning to states, counties, mu¬
nicipalities and their agencies and
instrumentalities and (b) $250,-
in Federal loans
prior to
a
statutory formula
with
(pres¬
maturities
new
continue
over
July
1,
1962)
Continued
up
to
on
35.1%
issues of school
at
record
levels,
$350 million of school
sold
in January,
1961
(the
DISCOUNT
CORPORATION
In addition to
underwriting
new
capital
issues, Smith, Barney & Go. frequently
OF
purchases large blocks of securities from
and estates and
individuals
institutions,
NEW
YORK
then distributes
them
ers
through deal¬
to
investors,
by "secondary"
or
Dealers
In
"special" offerings.
We welcome the
opportunity of working with
dealers, not onlv in this field but also in
united States Government Securities
J
with
connection
where
our
local
dealer
originations
facilities may be of service.
Bankers Acceptances
And
Smith, Barney & Co.
Members New York Stock
20 Broad
Philadelphia
Albany
•
•
Certificates of Deposit
Exchange and other leading exchanges
Street, New York 5, N. Y.
529 Fifth Avenue,
New York 17, N. Y.
Chicago
Allentown
•
•
Boston
Cleveland
Milwaukee
•
•
•
San Francisco
Dallas
Minneapolis
•
Hartford
Fifty-Eight Pine Street
New York 5,
N. Y.
(not to
$100,000,000 in such loans
years.
bonds
..
Senate and House this year would
under
3%%)
authorized. The Hous¬
authorization up to $2,875 billion.
exceed
at
an
but from 1955
additional $1,375
an ad¬
ditional $1.2 billion over the next
four
years,
bringing the
total
000,000
loans
This
1955,
ing Act of 1961 authorizes
an
authorizes
authorized.
was
interest rate determined annually
ently
sources
conditions
favorable." When this
as
a
the question of Federal aid to
education in question and answer
on
copies
and
program was
A booklet
IBA.
the financing
other
growth rate during the
(3) Sales of
bonds
rate
the
the
of
single month) and
$1,410,000,000 of school bonds
a
in
and secondary
with
parents
seems
for elementary and second¬
from
compensation
conclusion
supported by the facts that:
eral
tricts for burdens imposed by the
This
amount
sold in
Committee—Breakfast Meeting
of 1961.
of Federal aid.
program
enrollment
of
shall
over
existing programs, providing Fed¬
location
would be required that the entity
largest
ever
hold up
cedure
for
could
employed, was extended for
years—after efforts failed to
extension of this program
unless it was accompanied by the
are
two
Rules
attempt to bring
for
up
in
up
An
Municipal Securities
The IBA has
Elementary and Secondary
loans will be made if the financial
wise available from private lend¬
America,
new
Such
facilities.
lending
private
or
of
25
states,
page
26
Chronicle
The Commercial and Financial
Municipal Securities
Committee—Breakfast
Continued from page 25
determined
counties, municipalities and their
the bill.
agencies
finance
construc¬
tion and improvement of facilities
and equipment for use by opera¬
tion
or
lease
or
transportation
areas
H.
instrumentalities to
and
the acquisition,
and for
otherwise in
service
use
in
mass
urban
in coordinating
highway, bus, surface-rail, under¬
ground parking and other trans¬
portation facilities in such
areas.
available
favorable terms at
an
equally
on
interest rate
such
in
due
Federal
such au¬
amount equal to onethe
year,
would
to
authorize, in
the
thority
an
half the
which
amount
to
make
is
neces¬
the purpose
bill
issued
contracts
require that, to be
eligible for such guaranty, the
bonds be covered by a state or
local guaranty providing for pay¬
in
ment
interest
eral
guaranty of public transit au¬
thority obligations under which
the
Federal
enter
into
any
the
Government
service
debt
would
guaranty
providing that whenever
fiscal year the receipts of
public
connection
transit
with
the
by
payment
authority
the
projects
fi¬
involved,
bonds
of
in
operating
ex¬
penses, are not sufficient to make
all
debt service payments falling
such
would
of
amount
quiring
agency
of financing the con¬
rentals
struction by a
agency
sary
of
system
a
bonds
of
the
of
such
an
interest
not
rate
at
to
retirement
outstanding
agency;
(b)
an
3%%
with maturity dates not in excess
of 50 years and (c) shall be is¬
quired
to make payment. The
aggregate amount of payments
meeting
which
the
Federal
Government
could be required to make in any
fiscal year pursuant to
one
con¬
tracts under this section could
sued
under
trust
a
istration
indenture
The trust indenture would be
pare
a
tation
re¬
Administrator
the
in
New
has
York
been
Department of Commerce to pre¬
report
on
problems
urban transpor¬
and
their solu¬
tion. This report also presumably
quired to include provisions satis¬
factory to
the bonds
on
commissioned by the Housing and
Home Finance Agency and the
requirements.
specified
pay
The Institute of Public Admin¬
average
exceed
equal to the
payment by the Federal Govern¬
ment in any fiscal year in which
the Federal Government is re¬
an
the principal and
as they
become due and payable together
with
all expenses of operation,
maintenance
and
repair of the
system.
in addition, be
finance
shall bear
the local public transit
to fix and collect rates,
or other charges
at least
local public transit sufficient to
mass rapid transit the interest
redemption
or
include
(a)
and may,
to
Committee—Breakfast Meeting
that
bonds
revenue
Thursday, December 28, 1961
.
.
be issued for
would
Act
posed
payments of
principal and interest in full. The
after
otherwise
in
grant and loan
authority summarized above, Fed¬
nanced
not
5721
R.
financial
were
formula
a
Government will pay to
addition
Loans would be made only if the
assistance
under
Municipal Securities
Meeting
.
will
re¬
include
recommendations for
at
time exceed $50,000,000.
no
None of these bills passed. How¬
the
ever,
Housing
Act
of
1961
included provisions:
(a) Authorizing $25 million
UNDERWRITERS—DISTRIBUTORS—DEALERS
and
the
for
mass
urban
renewal
un¬
ministrator determines will assist
in
carrying out urban transporta¬
tion
plans
and
research, such
Municipal
grants
SECURITIES
not to be
long-term
not
to
exceed
of
cost
used
capital
the
BANKERS' BROKERS
program
transportation demonprojects which the ad¬
tration
Industrial, Public Utility
Railroad
der
for
...we're brokers'
ment
two-thirds
of
Members
Principal Securities Exchanges
project.
8 HANOVER
Albany
Chicago
Lowell
Allentown
Harrisburg
Newark
Syracuse
Taunton
STREET, NEW YORK 4, N. Y.
Altoona
Indianapolis
Philadelphia
Trenton
Ithaca
Lancaster
Pittsburgh
Tucson
Brockton
Los
Providence
Washington
trust):
merchandising and
promo¬
"Investment
Companies,"
our
annual labor of love
and its companion volume, "Charts & Statistics."
These services could
out
our
your constant
not
have flourished
interest,
as
encouragement,
they have with¬
and active
use
of
brokerage facilities.
congestion, facilitating the circu¬
Boston
Beverly Hills
invest¬
every
WIR, theWiesenberger Investment Report
•
studies and plans to aid
solving
problems
of
traffic
we
tion of Mutual Funds and Contractual Plans.
surveys,
in
(profitably,
The Dealer Services for
(b)
Hemphill, Noyes CBl, Co.
Today, virtually
•
the
To authorize grants under
the urban planning assistance
pro¬
gram for the preparation of com¬
prehensive urban transportation
too.
•
major
improvement,
brokers,
firm in the country uses
Angeles
Reading
Worcester
lation
of
people and goods in
metropolitan
and
other
urban
and
areas
ARTHUR WIESENBERGER & COMPANY
Members of New York Stock
reducing transportation
61
needs.
York
Exchange and American Stock Exchange
BROADWAY, NEW YORK 6, N.Y.
(c) To authorize $50 million in
loans
under
the
Community Fa¬
Program to states,
municipalities,
public
agencies,
and public corporations and com¬
cilities
Loan
missions
ment
of
for
and
areas
such
or
lease
service
in
use
Transit
Revenue
For
Banks, Brokers and Dealers
in
in
co¬
areas.
FOREIGN
SECURITIES
Bond
Legislation Planned
We
t{eiu York Stock 8xchange
Exchange
Hew York Cotton Exchange
Commodity Exchange, Inc.
Chicago "Board of Trade
advised that a bill will
be introduced at the next session
of
Congress
to
provide
"The
are
Transit Revenue
Act."
The
52 WALL STREET
48 COMMERCE STREET
New York 5
Newark 2
HAnover 2-9050
Mitchell 2-5690
Riverdale
KIngsbridge 9-3500
Act
credit
of
unpaid
of
Administrator,
United
interest
balance
the
revenue
in
agency
amount
upon
an
of
States)
the
and
the
on
the
bonds
a
Members
New York Stock
120
of
the
WOrth 4-5300
Teletype NY 1-2525
London:
20-24
Northgate House,
Mooregate, London, E. C. 2
such
not
under
American Stock Exchange
Broadway
N. Y.
Paris: 370 Rue St. Honore
aggregate principal
guarantee
Exchange
New York 5,
principal
exceeding $500 mil¬
Requirements for eligibility
lion.
for
the
of
MODEL, ROLAND & STONE
would
application of a local public tranportation
agency,
to
guarantee
(by a pledge of the faith and
payment
JOHNSON AVENUE
Bond Guarantee
proposed
authorize the
for
acquisi¬
improve¬
equipment
ordinating highway, bus, surfacerail, underground
parking and
other transportation facilities in
MEMBERS
3505
and
by operation
transportation
New
American Stock
facilities
the
and
use
urban
ESTABLISHED 1889
finance
construction,
mass
HALLE sc STIEGLITZ
to
tion,
pro¬
Vf;
Private
Teletype
to
London, England
I
Volume
194
4
Number 6120
.
The Commercial and Financial Chronicle
.
f
<■*
r
.
i* A
A
I*
mt
§&**
*
*IF
M-:#
urban
transportation
"
Committee—Breakfast
or
(f) Tax Immunity
Subcommittee
No
bills
introduced
were
in
attacking the
general
tax immunity of state
and municipal bonds. A bill was
introduced (H. R. 798) to deny
tax exemption to the interest on
state and municipal bonds (a) is¬
sued
to
year
finance
the
construction,
equipment or other development
of property which is to be
oper¬
ated
by one or more nonpublic
enterprises and (b) not secured
by the general credit of the is¬
suer;
but
no
action
taken
was
on
this bill.
The
Committee
for
Economic
Development in February of this
year
issued
a
statement
on
"Growth
cluded
a
and
Taxes"
which
recommendation
few individual
in¬
(with
a
dissents) to elimi¬
nate
on
the exemption for interest
future issues of state and local
a
tax credit for holders of
such securities. The C. E. D. pro¬
posal
assumed
that
the
Federal
Government has power to tax in¬
terest
on
municipal bonds and
eliminated
at
time.
any
on
The
Fiscal,
Mone¬
Management
tary
and
Debt
Policy
and
the
Research
and
Policy Committee of the C. E. D.
were
responsible
ment
of
for
policy
the
state¬
growth
and
regarding the
rec¬
on
eliminated.
such
In
articles
Mr.
&
Mrs.
of
I.
B.
every
case
have been
Curtis
A.;
Mr.
where
theory that
a
letters have been addressed to the
terest
on
editor
curred
the
attention
this
explaining
tional
of
of
basis
to
Committee,
the
constitu¬
the
and
importance
the tax immunity of municipal
bonds.
Treasury
the
of
summary
basis
constitutional
the
and
importance of the
immunity of municipal bonds
tax
furnished
were
to
all
members
of this Committee and IB A
Municipal
Securities
with
suggestion
the
Group
Committees
that
communicate
with
the
Subcommittee
C.
E.
Committee
D.
they
members
of
and
to
explain the impor¬
tance of tax immunity of munici¬
pal bonds. Copies of subsequent
correspondence
by members of
this
Committee
indicated
widespread action
suant
was
taken pur¬
cago
reform
casual
that
tax
the
nicipal fyond
recommendations
exemption for
interest
mu¬
should
be
November 1
on
Administration
to
Congress
broader
and
the
Certi¬
in
Chi¬
stated
that
plans to send
1962
in
a
much
of tax
program
that
of
Accountants
the
reform
reform,
bill being
in the Treasury gen¬
would broaden
the
tax
prepared
erally
base
to
include
income
not
cur¬
connection with this subject,
agents
of
the
Internal
Service in at least two
ing the past
a
portion
banks
for
year
of
in¬
purchase
carry
question has been requested from
the
of
Bureau
Internal
Revenue
in
Washington and the ruling is
expected soon. This reflects an¬
other
tax
effort
to
immunity
cut
the
action without legislative
or
type
and
ceived
by
taxable
be resisted
ing
bonds)
re¬
Revenue
bank
during
the
tinued
the
(calendar)
interest
tax
(gross
obtain
to
interest.
to total
the
per¬
This per¬
centage is applied to the interest
paid
on
is
expense
time
then
item.
deposits
and
disallowed
A
adverse
ruling
as
on
the
an
of
Internal
the
to
interest
n
A
Financing
Industrial
comprehensive report
subject
was
Committee
and
on
IBA
Printed copies
of that
mailed to
all
mem¬
bers of the IBA and many
copies
report
have
were
been
supplied
in
Continued
this
response
on
by
time
Co
Members New York Stock Exchange
Investment Securities
New York
44 Wall Street
NEW YORK
CHICAGO
of
May of
Established 1850
&
this
in
Hallgarten & Co.
Bear, Stearns
this
by the Board
Governors of the
this year.
on
by
approved
dur¬
deduction
paid
con¬
complete immunity.
Municipal
ex¬
centage which tax exempt interest
bears
Bureau
is
and then
year
empt interest less premium amor¬
tization)
vigorously if the rul¬
the
municipal
dividing the total by the net tax
exempt
by
have disallowed
the
con¬
stitutional amendment and should
Revenue
areas
of
value
administrative
by
of
result
rently subject to tax.
In
magazines this year have also
included
Public
fied
to
this suggestion.
General articles on tax
in
that
Reports in the press state that
Stanley
Assistant
Surrey,
Secretary
of the Treasury
for
Tax policy, in an address before
Institute
to
terest from
Mr.
American
the
the in¬
indebtedness
continued
or
and
on
totaling all interest (in¬
loans, U. S. Treasury
obligations, other bonds of every
Department's
Position
the
was
accounts
deposit),
portion of
obligations the interest
on
which
is
tax
exempt. The
formula used by the agent con¬
or
sists
Information
(savings
deposits
of
ommendation by the C. E. D. and
a
Bingham, Bingham, Walter & Hurry, Inc., Los Angeles, newly elected President
Mrs. George A. Newton, G. H. Walker & Co., St. Lcuis, Retiring President
&
certificates
called
taxes.
government securities and to sub¬
stitute
Meeting
that the credit could be decreased
facilities.
Congress this
s
,M
*/>«.
Municipal Securities
financing
I
27
Scranton
Chicago
205 Wyoming
231 S. LaSalle Street
Avenue
Geneva
Brussels
8
66 boulevard de l'Imperatrice
London
C. 2
Austin Friars, E.
I
rue
Petitot
page
28
28
Dr.
Milton
Baltimore;
The Commercial and Financial Chronicle
S.
Mr.
Eisenhower, President, Johns Hopkins University,
& Mrs. George A. Newton, G. H. Walker & Co.,
Dr.
Milton
S.
Eisenhower,
President, Johns Hopkins University,
J. McCloy,
Counsel, Milbank, Tweed, Hope &
and member of the Board of Directors,
Baltimore;
John
Hadley,
St. Louis
Chase Manhattan
Continued from page 27
port
to requests
lows:
from other interested
and
persons
and
Statutory
Advisory Committee
on
15 approved
a
In¬
draft report
"State Constitutional and Sta¬
tutory Restrictions
ernment
Debt."
Local Gov¬
on
The
five
basic
recommendations in the draft
re¬
In
many
provisions
have
contributed
to
Hurry,
Inc.,
Los
Angeles,
and
deviousness
in
ance
that the
Charles
statutory restrictions upon
local government borrowing con¬
debt operations.
The Com¬
mission believes that State action
to
sidered and
stitutes
sary
Commission
believes
that
serious
impediment to
effective local self-government in
a
These restric¬
States.
tions
handicap
local
communities
self-reliance
and
of
govern¬
ments, and impel them toward in¬
creased
State
financial
or
dependence
on
Federal Government
re-
complexity
States,
present
local
remedy this situation is
and urgent.
(1)
The
mends
neces¬
not
Commission
recom¬
that State provisions
respect
to
long-term
with
borrowing
place
comprehensive in
their
conditions
they
local borrowing power
apply uniformly—or with
upon
should
well-considered
minimum
of
debt.
(2)
The
mends
Commission
that
authority
recom¬
to
issue
ernments, subject to
local
for
permissive
and
the
results
simple majority
a
the question.
on
(3)
The
Commission
government
service
(4)
debt
Commission
that
the
States
proposed
es¬
interest
recom¬
consider
(President, The
Publishing Company),
prepared recommendations
computation of principal and
interest
transactions
on
in
feasible
cost
facilities
exceeded
if
the
the
estab¬
ors,
to
Copies
of the final report on
this subject will be available and
we
urge all members to obtain
copies from the Advisory Com¬
Intergovernmental Re¬
lations (722 Jackson Place, N. W.,
Washington, D. C.).
We urge all
persons
finance
on
be
the
on
alert
mailed to all members,
with transactions
and
be
effective
dated
Jan.
issued
2, 1962 and
transactions
settlement
on
1962.
These
should
be
after
or
when-
on
computed
Jan.
extremely helpful
uniform procedures
computations and in providing
explanation
for
of
computations
legislative proposals on
this subject in their areas so that
the dangers in this type of regu¬
of
local
debt
can
be
IV
Computation
on
Handbook
ex¬
plained and the adoption of such
regulation opposed.
The
mends
to
ance
★
Listed
★
and
Commission
that
States
able technical and
Transactions in
local
governments
with
regard to their issuance of long-
★
term
debt.
on
Funda¬
been sold. We have
revised
tical
material
thereto
copies
been
up
of
published
now
edition, bringing statis¬
and
references
to date and over 600
the new edition have
sold.
GRANBERY, MARACHE & CO.
Members New York Stock
Recommendation 4 suggests that
states consider regulating long-
Unlisted
term
Preferred and Common Stocks
ments
and Other
Exchange
Principal Exchanges
borrowing of local govern¬
by forbidding the sale of
bonds
at
above
some
interest cost
net
a
rate
specified multiple of
reported average yield rate for
high-grade municipal securities.
The draft report gave the follow¬
ing hypothetical illustration:
a
A state
local
MABON
& CO.
bonds at
1892
a
provides that
shall
computed)
Corporate and
no
(ap¬
Municipal Securities
which
than 1.3 times the
more
Underwriters and Distributors of
issue
net interest cost
propriately
is
Established
law
government
cur¬
rent
yield rate of the highest
municipal securities. At
of a particular bond
sale, that rate is 3.00%. If the
grade
MEMBERS
the
NEW YORK STOCK EXCHANGE
time
"best"
AMERICAN STOCK EXCHANGE
bid would involve
interest
115
Broadway, New York 6
Telephone REctor 2-2820
(1.4
can
ried
Bell
System Teletype NY 1-2152
-
1-4352
cost
times
be
of 4.20%
3.00%), the
made
out.
and
the
net
a
less
award
or
sale
car¬
But
if no bid is this
low, all offers must be rejected.
Recommendation 4 suggests only
that
~~k
★
★
★
★
*
states
consider
this
type
of
regulation. The impact of this type
NEW YORK
SAN FRANCISCO
of
of
avail¬
advisory assist¬
in
Municipal Bonds was
published in September, 1959, the
first edition of 10,000 copies has
a
Subcommittee on Trading
Cashiering Procedures, under
the
Chairmanship of Mr. Neal
Fulkerson (Bankers Trust Com¬
Fundamentals
Since the Handbook
mentals
Municipal Securities
The
on
recom¬
make
an
Municipal Bonds
measures
to
regulate long-term
borrowing of local governments
by reference to the net interest
(5)
Municipal, State and Revenue Bonds
in
in
or
to the currently prevail¬
ing interest rate on high quality
municipal securities.
★
8,
training back-office personnel.
cost of prospective bond issues in
★
for
recommendations
obtaining
concerned with municipal
to
will be printed in pamphlet
form
relation
★
mu¬
nicipal securities.
lished rate.
lation
Gushee
arbitrary prohibition
These recommendations, if ap¬
financing needed, desir¬ proved by the Board of Govern¬
and
studies
New York), with the assist¬
(Bank¬
Trust
Company)
and
Mr.
of Mr. H. F. Dobbin
have
for
method
and
property taxation.
The
mends
The
limiting
debt
or
by reference to the local
base for
President
an
recom¬
mends the repeal of constitutional
and statutory provisions limiting
local
Foreign Bonds
voters
determined by
vote
Utility, Industrial, Railroad,
a
referendum only on petition, and
with
participation in any such
referendum available to all elig¬
ible
Dealers, Brokers and Dealer Banks
debt.
of
way
regulating local debt would
tablish
mission
bonds should be legally vested in
the governing bodies of local gov¬
Complete Brokerage Service
of
ments be
term
ALL MARKETS ON ONE CALL
local
against
any
Incoming
Financial
conclude that it is
we
desirable
a
able
coverage;
ers
implications of this type
of regulation were not fully con¬
and indebtedness of local govern¬
a
Convertible and
&
Bank, New York
distinctions—to all types of long-
Public
George A. Newton, G. H. Walker & Co., St. Louis, Pinning
Presidential Badge on Curtis H. Bingham, Bingham, Walter
pany,
the United
on
Thursday, December 28, 1961
regulation would depend upon
precise formula adopted in
any state.
However, we believe
as
are
and
tergovernmental Relations
Sept.
fol¬ sources.
.
of
The
Debt Restrictions
on
action
the present maze of constitutional
m
The
state
.
the
organizations.
Constitutional
for
.
BOSTON
SPRINGFIELD
PHILADELPHIA
STAMFORD
SYRACUSE
Volume 194
Number 6120
.
.
,
The Commercial and Financial Chronicle
29
New
Officers: David J. Harris, Bache & Co.,
Chicago; Thomas M. Johnson, The Johnson, Lane, Space
Corporation, Savannah; Curtis H. Bingham, Bingham, Walter & Hurry, Inc., Los Angeles; William T.
Kemble, Estabrook & Co., Boston; James H. Lemon, Johnston, Lemon & Co.,
Washington, D. C.;
(Walter H. Steel, Drexel & Co., New York, not present in
picture, is also an officer)
The
pamphlet
Suggestions
on
Subcommittee
on
Trading
Cashiering Procedures.
for
Marketing Municipal Bonds
Sale, approved by the
Committee in 1960, has been well
received and over 10,000 copies
at
of
it
have
been
Respectfully submitted,
MUNICIPAL
Alan
Reports
report are covered in re¬
ports of some of the subcommit¬
follows:
Subcommittee
on
Accounting
Terminology and Practices.
are
dustrial
chase
Aid
and
Political
New
Lease-Pur¬
Financing By States and
Subdivisions.
&
Savings Bank
York, N. Y.
F.
Co.
Subcommittee
G. H.
on
Municipal
a
Conference.
Subcommittee
St.
Syndicate
Op¬
erations.
Pierce,
Fenner
York, N. Y.
H.
Thomas L. Ray
Mercantile Trust Co.
St.
Seasongood
Calif.
C.
Payne
J.
Corpora¬
Creighton Riepe
Sons
Baltimore, Md.
Dallas Union Securities
Co., Inc.
Allen
D.
Sapp
Schmidt, Roberts & Parke
Peter V. N. Philip
W. H. Morton &
New
Mayer
Alex. Brown &
Dallas, Tex.
Cleveland
&
Cincinnati, Ohio
Delmont K. Pfeffer
Jack
Louis, Mo.
Gordon Reis, Jr.
The First National City Bank
New York, N. Y.
Stifel, Nicolaus & Co., Inc.
St. Louis, Mo.
Pratt
Boston, Mass.
Moulton & Co.
Los Angeles,
Co., Inc.
Estabrook & Co.
Donald W. Moulton
Clark
First
Marsom B.
Moroney, Beissner & Co., Inc.
Houston, Tex.
R.
Dickson &
Co., Inc.
York, N. Y. !
Philadelphia, Pa.
Continued
on
page
Piper, Jaffray & Hop wood
Minneapolis, Minn.
John W. de Milhau
Walker & Co.
Louis, Mo.
The Chase
Manhattan Bank
New York,
N. Y.
Russell M. Ergood, Jr.
Stroud & Co., Inc.
H. Frank Burkholder
on
Lynch,
S.
Charlotte, N. C.
Robert E. Moroney
tion, Cleveland, Ohio
Elzey G. Burkham, Jr.
Problems.
i
York, N. Y.
C.
R.
Blyth & Co., Inc.
Cecil
Merrill
Logan V. Pratt
Louis, Mo.
New
Robert G. Davis
Chicago, 111.
Metropolitan
on
O. V.
The
The First National Bank
& T. A.
Subcommittee
Carr
Clarence F. Davis
Barker
Denver, Colo.
Liaison Subcommittee to A. B. T.
C.
Morey
G. Edwards & Sons
William F. Morgan
Winston-Salem, N. C.
P. Alden Bergquist
Subcommittee.
Seattle, Wash.
Frank
A.
St.
E. William Darmstatter
J. A. Hogle &
Liaison and Bond Sale Procedures
Area
McKinney, Inc.
Trust
Frederick
Water¬
Wachovia Bank & Trust Co.
Dallas, Tex.
Harris
Richard
Campbell,
Co.
man
John
Ernest J. Altgelt, Jr.
Committee To Study In¬
South wick,
New
Birmingham, Ala.»
&
Andrew S. Beaubien, L. G. Beaubien &
Co., Limited, Montreal; Irving H. Campbell,
Gouinlock & Company Limited, Toronto; J. Howard Carlson, Carl M.
Loeb, Rhoades & Co.,
York; Arthur A. Christophel, Reinhardt & Gardner, St. Louis; William H. Claflin,
III, Tucker,
Anthony & R. L. Day, Boston; Milton S. Emrich, Julien Collins & Company, Chicago
& Smith Inc.
Taylor B. Almon
Almon
Governors:
Colin A. Campbell
Chicago, 111.
Sterne, Agee & Leach
as
Financial Advisers Subcommittee.
Special
Browne, Chairman
of
Rucker Agee
this
Bell,
New
John Nuveen & Co.
America, N.T. & S. A.
San Francisco, Calif.
Many matters of interest and
importance which are not covered
tees, which
K.
Bank
Subcommittee
SECURITIES
COMMITTEE
distributed.
VI
in
and
Public
New
Equitable Securities Corp.
Nashville, Tenn.
Philadelphia, Pa.
DEALERS IN...
John B. Farra
W. E. Hutton &
HHI
ll
Co.
Lexington, Ky.
F. D. Farrell
City National Bank & Trust Co.
Kansas
U. S.
City, Mo.
Harvey J. Franklin
Merrill
State
Smith
&
San
Lynch,
Pierce,
Inc.
Francisco, Calif.
Arthur
Government,
Fenner
State and Municipal Securities
S. Friend
Folger, Nolan, FlemingW. B. Hibbs & Co., Inc.
Washington, D. ,C.
Municipal
W. Neal Fulkerson, Jr.
Bankers
and
New
Trust
Co.
York, N. Y.
William H. Hammond
Telephone: HAnover 2-3700
Braun, Bosworth & Co., Inc.
Chicago, 111.
Revenue
William G. Harding
Coffin & Burr
Boston, Mass.
Bonds
Elmer
G.
Hassman
A. G. Becker &
Co., Inc.
Chicago, 111.
Lloyd B. Hatcher
White, Weld & Co.
New York, N. Y.
T. Norris Hitchman
Kenower, MacArthur & Co.
Detroit, Mich.
Bache & Co.
Founded 1879
UNDERWRITERS
MEMBERS NEW
OTHER
LEADING
36 WALL
Tel:
AND
>
DISTRIBUTORS
YORK STOCK EXCHANGE AND
STOCK AND COMMODITY EXCHANGES
STREET, NEW YORK 5, N. Y,
Dlgby 4-3600
TWX: NY 1-1828
E.
Arthur
Kirtley
The First
Boston Corp.
Chicago, 111.
offices throughout the United States, Canada and abroad
BOND
DEPARTMENT
Arnold J. Kocurek
Rauscher, Pierce & Co., Inc.
San Antonio, Tex.
Edward
D.
30 Broad
David
T.
Street, New York 15
McGrew
Convenient Offices
The Northern Trust Co.
Chicago, 111.
82
Chemical Bank
Miralia
Kuhn, Loeb & Co.
New York, N. Y.
in all
five boroughs of New York City
30
vV^WJ
U
n*
30
New
Governors: Joseph A. Glynn, Jr., Blewer, Glynn & Co., St. Louis; Frank R.
Newton, Jr., Lentz,
& Co., San Antonio; Robert A. Podesta, Cruttenden, Podesta <ft
Co., Chicago; James M.
Powell, Boettcher and Company, Denver; J. B. Sanford, Jr., Hattier & Sanford, New Orleans;
Anthony E. Tomasic, Thomas & Company, Pittsburgh
Contnued from page 29
Fred D.
The
Siefert
Stern Brothers
LvJii'
1
Co.
New
H. Jackson Shirley, Jr.
San
York, N. Y.
Joseph Vostal
Cruttenden, Podesta & Co.
Denver, Colo.
Kidder, Peabody & Co.
York, N. Y.
Walter H. Steel
Robert
Drexel & Co.
V.
G. Thomas Yeager IH
Wehrheim
York, N. Y.
Philadelphia, Pa.
Victor
Brainerd H. Whitbeck
H. J. Steele & Co.
The
Pittsburgh, Pa.
New
First
Boston
H.
APPENDIX A
A KID WEEKS
Public
]
The
provide
of
on
the
act
..
area
of
income
Section
5(a),
determines
he
tjOf$T
existed
%
1885
tive employment opportunities
the
United States and Canada
THOMSON & MSKINNON
of
„
"
at
Z7
£
SECURITY AND COMMODITY EXCHANGES
YORK
120
^
r
Section
6
000,000
in
projects
in
municipality
any
authorizes
Federal
$100,-
loans
for
redevelopment
areas
Section
5(a)
under
Go,
&
STOCK
STOCK
EXCHANGE
EXCHANGE
BROADWAY, NEW YORK 5, N. Y.
Teletype NY 1-749-51
WOrth 44300
Private Wires
Atlanta
Boston
Hartford
Buffalo
Houston
Philadelphia
Chicago
Lima, O.
Pittsburgh
Dallas
Los Angeles
St. Louis
Secretary
annual
least—(A)
San Antonio
Wheeling
Detroit
Fayetteville, N. C.
Minneapolis
San Francisco
New Orleans
South Bend
Youngstown
un¬
of
aver¬
50%
above
for three
average
calendar
(b)
Under
do
the
not
which
the
a
meet
he
determines
in
condition
PUBLIC UTILITY
States
the
which
of
AND
FOREIGN SECURITIES
are
highest in numbers
of low-income
and
and Dealers in
INDUSTRIAL
5(b), those
United
percentages
families,
Underwriters, Brokers
years.
Section
within
areas
there
substantial
and
persistent unemployment or
underemployment. The Secretary
shall consider, among other rele¬
vant factors, the number of low-
Burnham
and
Company
MEMBERS NEW YORK AND
AMERICAN STOCK EXCHANGES
15 BROAD
CABLE:
STREET, NEW YORK 5, N. Y.
COBURNHAM
or
is lo¬
therein.
periods speci¬
(2); and
the
two
exists
MEMBERS NEW YORK STOCK EXCHANGE AND OTHER PRINCIPAL
from
or
area
the
TORONTO
,
cated
Gov¬
State
of
require¬
ments set forth in subsection (a)
offices in the United States and Canada
the
States in which such
iA designated
AMERICAN
substantial
Secretary
that
finds
among
.
from
or
MEMBERS
in
preceding four calendar
or
(B) 75% above the
national average for two of the
preceding three calendar years;
or (C)
100% above the national
average of one of the preceding
and
,
ernment
years;
but
43
time
national
the
which
Broadway, New York 4
receiving public
rate of unemployment has
age
been
and commodities in the
been
paragraph
where
Labor
listed, unlisted securities
has
Pershing
NEW
the
of
assistance from the Federal
employment, excluding unem¬
ployment due primarily to tem¬
porary
or
seasonal factors, is
currently 6% or more and has
averaged at least 6% for the
(2)
BROKERS
INDIANAPOLIS
prospec¬
Washington
where
qualifying
CHICAGO
United
which
adminis¬
programs
the
upon
persistent unemployment for
an extended period of time. There
shall be included among the areas
so designated any area—
fied in
2
the
out
and
(1)
5
in
in
in
general
migration
those
Labor finds that the rate of
FOUNDED
families
the
of
and the proportion of the
population
of
each
such
area
parable with those set forth in
paragraphs (1) and (2), below,
that there has
Plaza, New York 5, N. Y.
the
to
by the Department of Agri¬
basis of standards generally com¬
One Chase Manhattan
of
such
extent
area,
enter¬
within the United States
areas
which
Hornblower& Weeks
of
for
to
to
is
assistance
industries,
Under
(a)
People, the Ideas, the Facilities of.
each
of
area,
manpower
follows:
as
depend
the
the relationship of the
levels
prises and individuals in areas of
substantial and persistent unem¬
ployment and underemployment
in planning and financing their
economic redevelopment. The act
will be administered by an Area
Redevelopment Administrator in
the
Department
of
Commerce.
The Secretary of Commerce shall
designate "redevelopment areas"
From Coast to Coast You can
families
such
of
the availability
in each such area
supplemental employment, the
Of
87-27
the
Federal
communities,
that
such
each
(1961)
Law
purpose
United
are
culture, the current and
Summary of Area Redevelop¬
[hornblower
the
families
under
tered
York, N. Y.
ment Act
of
proportion
farm
income
area
Kansas City, Mo.
Corp.
Thursday, December 28, 1961
.
States, the extent to which "rural
development" projects have pre¬
viously been located in any such
Co.
&
the
such areas,
levels
Zahner
Zahner
total
each
Baker, Watts & Co.
Baltimore, Md.
The Philadelphia National Bank
Harry J. Steele
States,
areas
low-income
Wulbern
Pierce, Carrison, Wulbern, Inc.
Jacksonville, Fla.
New
rural
ous
Francisco, Calif.
Edward B.
,
.
income farm families in the vari¬
Dean Witter & Co.
of
Chronicle
Buford Scott, Scott & Stringfellow, Richmond, Va.; G. Powell Davis, Investment Corporation of
Virginia, Norfolk, Va.; Coleman E. Trainor, Peoples National Bank, Charlottesville, Va.; T. Russell
McConchie, Peoples National Bank, Charlottesville, Va.; C. Wiley Grandy, Investment Corporation of
Norfolk, Norfolk, Va.; William L. Frazier, Curtiss, House & Co., Cleveland
James Wiley
Stone, Jr.
Trust
Marine
Western New York
& Co.
Kansas City, Mo.
New
«Jl
.
S.
-
E.
w
The Commercial and Financial
Newton
Russell
ha1
•
Dl 4-1400
TELETYPE NY
1-2262
I
Volume
Jay Emerson
194
Number
6120
.
.
The Commercial
.
and Financial Chronicle
Thors, Asiel & Co., New York; Mr. & Mrs
Thors, Kuhrt, Loeb & Co., New York
George A. Newton, G. H. Walker & Co., St. Louis; Herbert H. Land,
du Pont of Canada Limited, Montreal
J. Emerson
and
$100,000,000 in Federal loans
projects
in
redevelopment
designated under Section
5 (b)
to aid in financing any
project for the purchase or de¬
able maturities
for
of
areas
obligations, plus
V2 of 1% per annum) which in
November, 1961 would have been
velopment
4%. The Secretary shall not make
of
land
(including, in cases of demon¬
need,
machinery
and
equipment)
for
industrial
or
commercial usage. The loans shall
be
capital
for
extended
from
to
area
one
an¬
other; but the limitation regard¬
relocation shall not be con¬
ing
strued
the
to
assistance for
prohibit
expansion
business
of
entity
tablishment
affiliate
existing
an
through
of
the
if
that such estab¬
Secretary finds
lishment will not result in
in
crease
area
of
other
original location
years
may
at
rate
a
or
by
is
for
from
other Federal
terms,"
"reasonable
rate
in
the
obtained
be
current
the
not
act
(the
Secretary
the
greater
the
of
to the ap¬
cost
aid
eral
in
with
connection
the
At
be
least
10%
supplied
of
by
the
cost
must
state
the
subdivision
political
tion
which
is
in character,
as a
thereof,
equity capital
as
loan
has
(b)
States
of
been
Underwriters
project
re¬
only
financial
must
or
than
more
(ii) the
or
interest
rate
on
obligations of
next
preceding
a
the
assistance
has
the
issuance
by
the Secretary and adjusted to the
nearest Vs of 1%, plus % of 1%
per
annum)
would
which in November,
3%%. Such loans
be
could
be
other
conditions
made
ment
and
only
if,
(a)
there
expectation
(b)
among
the
of
is
a
public facilities within a re¬
development area, if, among other
conditions
(a) the project will
tend to improve the opportunities
in the
will
establishment
pansion of industrial
or
or
ex¬
commer¬
political
grants to
any
subdivision
state, or
thereof,
or
17 authorizes
$10,000,weekly retraining pay¬
ments to unemployed or under¬
employed individuals residing
for
within
are
redevelopment
certified
to
(c) the project will fulfill
pressing need of the area and
tional
training
be
a
there
such
little
is
project
without the
under
this
Section
to
probability
be
can
-
that
undertaken
assistance
of
a
grant
technical
assistance
average
be
useful
conditions
or
in
alle¬
excessive
of
underemploy¬
ment.
cupational
not
the
$4,500,000
adaptability,
potentialities
and
equal
to
authorized
7
the
or
organization
senting
any
assist
cilities.
ties up
in
Such
to 40
or
public
non-profit
redevelopment
loans
repre¬
allowances
for
total
state
unemployment
years may
at
the
close
of June
and
DISTRIBUTORS
maturi¬
be made,
Primary Markets in
SPECIAL SITUATIONS
J, R.Williston & Beane
TWO
New York
Philadelphia
PETER MORGAN
Stock Exchange
&
Co.
Stock and Commodity Exchanges
BROADWAY, NEW YORK 4, N. Y.
Chicago
Rye
Plainfield
Westport
1 CHASE MANHATTAN PLAZA, NEW YORK 5, N. Y.
HAnover
2-1690
the
re¬
Corporate Securities
and other Leading
week
in
This act and all authority con¬
Distributors
1889
when
ferred thereunder shall terminate
BROKERS-DEALERS
Members T^ew Tork
a
oc¬
State, Municipal and Revenue Bonds
ESTABLISHED
the
making such payments.
area,
public fa¬
with
■
shall
of
dependents
payable for
UNDERWRITERS
;
16
any
unemployment
thereof,
association
financing
state,
of
amount
$100,000,-
subdivision
exceed
amount
weekly
appropriate)
of
skills,
occupa¬
retraining
compensation payment (including
(a) studies of the size, charac¬
teristics,
shall
and
be
unemployment
for
weeks
$4,500,000
would
or
under Section 16 of the act. Such
payments
authorizes
provide
undergoing
such payment for any week
section.
9
who
areas
by the Secretary of
Labor
so
Section 16 authorizes
Section 8 authorized $75,000,000
Section
000
and
cial plants or facilities.
in Federal
ability
and services and (c) as¬
sisting in setting up apprentice¬
ships and promoting journeymen
and other on-the-job training.
to contribute,
viating
successful
commer¬
the cost of the project in propor¬
tion to its
which
for the
ex¬
plants or facilities, (b) the
entity proposes to contribute to
tend to improve the opportunities
area
or
for the
or
cial
in the
redevelopment
area
establishment
pansion of industrial
repay¬
project
redevelopment
successful
redevelopment area; (2) pro¬
viding occupational training fa¬
any
repaid.
Section
•
as
after
000 in Federal loans to any
to
not
all interest-bearing
or
at least 5%
equity capital
as
private
compar¬
the
repayable
Federal
been
of
cost
sources
be
annual
or
non-governmental
assistance
Federal
or
obligations
would
higher of (i) 2J/2%
reasonable
loan repayable only after .the
Secre¬
the
which
a
or
by a community or area organiza¬
political
out¬
cilities
1961
undertaking).
or
on
for
the act (the rate paid by the
Secretary on funds obtained from
the
Secretary of the Treasury,
part of the public debt as com¬
puted at the end of the fiscal year
aggregate
Kurt Grunebaum, New York Hemseatic
Corporation,
Benjamin Peyser, Newburger, Loeb <ft Co., New York
in
under
plicant (excluding all other Fed¬
Mrs.
York;
lated aspects of the labor force of
repayment. Loans
65%
&
New
private or public non-profit or¬
ganization or association repre¬
senting any redevelopment area,
on
the United States then forming a
on
than
yields
marketable
United
of
available
assur¬
this section shall not exceed
determined
the
from
average
standing
of
applied
otherwise
reasonable
a
the
of the Treasury, which rate
would
ance
determined
supplied by non-governmental
formula
paid
funds
tary
on
there is
that
participation
it is
unless
of
available
not
Mr.
"reasonable terms," at an interest
rate determined under a formula
average
and
paid in full and
up
if
the
a
be
interest
an
under
any
participation
a
on
to
private lenders
agencies
in
or
maturities
otherwise
not
the
such
be made, if the fi¬
assistance
nancial
in
operations.
with
Loans
in¬
an
where such entity con¬
business
ducts
25
unemployment
area
the
is¬
cannot be made
es¬
branch,
new
a
subsidiary
or
day
the
unless he determines that the loan
basis
working'
to assist establishments
or
relocating
of
of the last
as
preceding
loan without
any
strated
not
month
suance
facilities
and
the
31
Teletype N. Y. 1-2078
30, 1965.
32
The Commercial and Financial Chronicle
Kansas
Committee Report on
Industrial Aid and
Court,
finance
to
New
the
to
of this Com¬
municipal
industrial
was
submitted at the
report
financing
Spring Meeting
was
approved
by the Board
of
of the
IBA
May
1961.
each project. The 1961 State
legislature authorized the issuance
of bonds up to
12,
Printed
Delaware
were
mailed
to
all
of
tion and hun¬
of
ad¬
ditional copies
have
been
furnished
credit
State
issuance
of
of
the
bonds
in
State
to
Development Authority,
authorization
aid
in
This
$10
time, however,
project can be
$2 million.
individual
no
Illinois
report
regarding
Building Commission with
struction
the
State
powers
repayment
of
ap-
State
lion in bonds to finance the
trial
a
Authorized
—
In¬
Development Authority
empowered to issue up to $5 mil¬
the basic report.
Connecticut—Authorized
over
dustrial
municipal
project
a
Airport
or
plant
facilities
for
lease
sale to
private industries in
of
state
as
the
con¬
acquisition of indus¬
that
labor-surplus
or
areas
designated
are
;
areas.
of
built
it
and
land
leased
and
for
made in
Borough
of Moonachie, N.
which
was
it
building
factory
the
contended
in
J.,
the
that
in
the
bills were
legisla¬
Texas
Vermont—A
State
new
Indus¬
trial Building Authority has been
organized. Created by the 1961
Vermont legislature, the new or¬
ganization is empowered to pledge
the credit of the state up to $10
million
to
guarantee local de¬
velopment agency mortgage loans
on industrial plants.
West
Virginia
—
Authorized
Kansas
R. H. Moulton & Co.
Los Angeles, Calif.
Marsom B. Pratt
Estabrook & Co.
Boston, Mass.
empoWered under
St.
Wisconsin
Louis, Mo.
Seasongood & Mayer
—
Shirley, Jr.
Cruttenden, Podesta & Co.
Denver, Colo.
James Wiley
25
New
York
BROAD
Stock
Exchange
and
Other
A
bill
San
Francisco, Calif.
G. Thomas Yeager III
Baker, Watts & Co.
Baltimore, Md.
Exchanges
Telephone: HAnover 2-0600
Jan.
FORT PIERCE
LAKE WORTH
LONDON
GENEVA
New
York
Newark
Palm Beach
Miami
amend¬
County
was
Appendix
is
A
sold
reported
44,950,000
3,700,000
7,863,000
INDUSTRIAL
or
AID
Rucker
Taylor
♦Three
the
issues
Agee
for
$85,GOO,000
THE
HEART
OF
THE INSURANCE
DISTRICT"
State
by
NEW
&
5
of
Champ
Commission;
not
MEXICO
Issuer—
Amount
City of Clovis
OKLAHOMA
AND
Cherokee
Montgomery
$25,000,000
1,800,000
Issuer—
State
of
$15,650,000
Bradley
500,000
Fayette
ARKANSAS
Issuer—
Benton
Benton
Blytheville
175,000
Goodlettesville
400,000
Haywood
310,000
Hardeman
2,400,000
Conway
*2,400,000
Lebanon
Nashville
Greenwood
Lake
278,000
Village
North Little
Rock
Polk
200,000
$22,113,000
♦First Issue of
$11,318,000
tion.
Canadian Stocks—Bonds
American Stock
Exchange
Exchange
Montreal Stock Exchange
61 BROADWAY
Tel. WHitehaU 4-8980
Obligat'n
Issuer—
Amount
Toronto Stock
Oklahoma
TENNESSEE
Members
"IN
4
gApproved by State Commission.
1927.
Teletype NY 1-384
fVillage
General
STREET, NEW YORK 38, N. Y.
•
D.
^Approved and voted.
CHARLES KING & CO.
Telephone BEekman 3-0626
S.
Issuer—
Amount
TO
Specialists (with Predecessor Firm) in Insurance
116 JOHN
Union
Wiggins
voted.
State, Municipal and Revenue Bonds
since
(Senatobia)
Terry
$3,665,000
t Approved
CORPORATE & MUNICIPAL BONDS
Serving Dealers and Institutions
Starkville
Tate
General Obligat'n
$Monroe City, Rev.
§Joplin, Revenue
Underwriters and Distributors of
Stocks.
Ruleville
100,000
155,000
Underwriters and Dealers in
Oldest
Pike
300,000
50,000
Exchange
INSURANCE STOCKS
K
Okolona
Osyka (District)
Osyka (City)
of
McKinney, Inc.
Dallas, Tex.
Noxubee
ALABAMA
Almon
&
account
$350,000
125,000
393,000
2,200,000
7,000,000
350,000
700,000
Loeb & Co.,
York, N. Y.
B.
Morton
Morton
fEl Dorado Springs
$Charleston
tMonroe City
amount.
aggregate
Amount
York, N. Y.
Almon
60,000
$2,000,000
$26,800,000
Sterne, Agee & Leach
Birmingham, Ala.
Co.
___
I
POLITICAL
Kuhn,
New
Mathiston
Amount
LEASE-PURCHASE FINANCING
AND
Itawamba
Lafayette County
Issuer—
$3,000,000
$2,000,000
COMMITTEE
STATES
Tennessee
1, 1961.
David T. Miralia
Members New York Stock
1
1
23
a
Respectfully submitted,
STUDY
Grenada
Hernando
measure.
of municipal industrial
issues
New
&
$26,800,000
11,318,000
Monroe V. Poole, Chairman
Geo. B. Gibbons & Co., Inc.
Beach
Lake Worth
Shelby Cullom Davis
8
*$124,409,000
as
an
SUBDIVISIONS
Washington
2
Arkansas
51
Service:
Fort Pierce
Alabama
22,113,000
Milwaukee
summary
AMSTERDAM
Amount
8
BY
Direct Wire
Aggregate
Issues
1
bond
PALM BEACH
Number of
State—
1
Through
enacted
Fulton
Amount
1, 1961:
Oklahoma
was
Forest
MISSOURI
The
dustrial bonds
New Mexico
SPECIAL
MIAMI BEACH
permit
Covington County
$8,663,000
3,665,000
2,000,000
2,000,000
Teletype: N.Y. 1-210
NEWARK
to
Copiah
Corinth
APPENDIX A
6
Attached
STREET, NEW YORK 4, N. Y.
,
Missouri
development
authorized since Jan.
WASHINGTON
$2,-
a
appropriate funds to
exempted from the
CO.
Co.
Dean Witter &
dustrial
ment,
a
200,000
50,000
30,000
1,500,000
140,000
425,000
250,000
Georgia
Kentucky
Mississippi
to
in Wisconsin.
H I R SCH
400,000
200,000
100,000
Cincinnati, Ohio
non-profit agencies to promote in¬
counties
Members
from
groups
000,000 fund.
Corporate and Municipal Securities
100,000
80,000
100,000
:?■ 300,000
Gordon Reis, Jr.
will make loans to local industrial
development
Chickasaw
School Dist. 3 & 4
School District #4
Mercantile Trust Co.
following municipal in¬
were reported
sold, or authorized (except a
the
few subject to vote) since
1961 State enabling act.
a
Canton
Thomas L. Ray
a
Authority to pro¬
mote expansion of industrial ac¬
tivity in economically depressed
areas in key parts of the state. The
terms of
in
133,000
1,850,000
800,000
60,000
250,000
250,000
370,000
250,000
250,000
City, Mo.
Donald W. Moulton
State Industrial
Authority,
Underwriters, Distributors and Dealers
$175,000
400,000
City National Bank & Trust Co.
H. Jackson
committee.
Issuer—
Amount
F. D. Farrell
in
defeated
Farra
Lexington, Ky.
this year which would have
Industrial Aid bonds.
were
Issuer—
City of Florence
♦Authorized.
The Kentucky Co.
authorized
bills
KENTUCKY
MISSISSIPPI
John B.
not tax-exempt.
Texas—Two separate
introduced
of
which
$14,950,000 G%
purchased by Southern Land
Pulp Corp.
Co.
Stroud & Co., Inc.
Philadelphia, Pa.
by
constructed
Authority was not re¬
quired for air terminal purposes
was
&
Russell M. Ergood, Jr.
Port
and therefore
Timber
*$3,700,000
suit brought by the
a
will be
bonds
Amount
20
to
a
private
industry,
Superior Court Judge Charles W.
Broadhurst has ruled. The ruling
was
Early County
Winston-Salem, N. C.
New
Teterboro
on
♦Authorized,
Corp.
& Trust
Wachovia Bank
years
Both
exceed
Port
Issuer—
*$44,950,000
John C. Clark
of
The
—
Louis, Mo.
ap¬
York Authority must pay taxes on
guarantees
not
York
GEORGIA
Amount
Equitable Securities
Nashville, Tenn.
author¬
the
ture
can
Constitution
Job
financing
the
construction
of
buildings for sale or lease to
private
industries.
Outstanding
guaranteed
industrial financing subsequent to
insure
and
Monroe V. Poole
simply summarizes important de¬
to
sion
faith
and
organizations.
velopments
State
a
million at any one
«n
request to
individuals
and
Authorized
Building Commis¬
empowered
to
pledge the
the
the Associa¬
dreds
—
Industrial
subsequently
members
$25 million for this
purpose.
copies of that
report
voters
Nov. 7, an amendment
bonds.
for
Governors
on
The
—
Thursday, December 28, 1961
H. Frank Burkholder
plants
$100,000,000
bonds—$50,000,000 general obliga¬
tion
and
$50,000,000
revenue
proved mortgages
on
industrial
expansion and development proj¬
ects.
The Authority will insure
these projects up to 90% of -the
cost, to a maximum of $5 million
and
of
St.
private industries.
on
New
on
bonds
revenue
construction
.
Elzey G. Burkham, Jr.
G. H. Walker & Co.
izing the creation of the New York
oj George B. Gibbons
& Co., Inc., New York
City, was Chairman of the
Special Committee to Study Industrial Aid and
Lease-Purchase Financing by States and Political
Subdivisions. Its Report follows:
V
basic
ruled
state law permit¬
a
York
proved,
Supreme
has
case,
ting cities to issue
for lease to
Monroe V. Poole, President
The
Kansas
test
a
constitutional
Lease-Purchase Financing
mittee
The
—
in
.
.
NEW YORK
'
6, N. Y.
TWX N. Y. 1-142
a
much larger authorisa¬
Volume 194
Number 6120
.
.
The Commercial and Financial Chronicle
.
33
not be
overlooked, there
some suggestions
ing each party.
Report of the Municipal
Subcommittee
New
York
City,
(3)
eral
direction of flow may be
summarized as follows:
tant matters
A.
the
on
market condi¬
tions.
dis¬
tribution
the
Specific
(2)
of
comments
this
issue.
able
(3) Presale interest from insti¬
Com¬
tutions and members.
desir¬
mittee,
as
be, did not
permit
many
opportunities
(5)
major¬
of
this
(6) Final
justed.
sit
to
group
down together.
This
will
John W. de Milhau
asmuch
of
this
as
originally
two
sections.
Committee
entitled
was
the
"Proxy"
part will
deal with our thoughts and recom¬
mendations on this subject. The
second part will deal with other
subcommittee
important
this
first
the
questions
subcommittee
to
referred
for
discussion.
The Proxy Problem
convenient
and
offering
participation
if
call
Member
im¬
(2) Must not act for too
the
'
Should
agreement
to the best way to
as
handle all the
complex questions
that may arise. However, we think
that by giving publicity to the
duties and responsibilities of those
involved we will achieve a better
understanding and a more positive
approach on the part of those
concerned.
The
as
result
a
problem has arisen
proxy
the
of
formation
of
syndicates comprised of members
located in many different areas of
the United States and who do not
have
the
office in the city in which
account manager will
hold
an
meetings. We are all well aware
of the necessity for the manager
to have
a
definite commitment or
on
the part of all
members prior to
the submission
other
of
a
The
decision
bid
behalf of the
on
of communication between the out-
reached. If unwilling
to file orders and pick up allot¬
ments should arrange for someone
else to do
It
has
become
to
pick
up
the
custom, of
necessity, for the managers of ac¬
counts with a large membership
to request the out-of-town mem¬
ber to arrange to have a proxy
represent him so that he may be
advised properly of the discus¬
sions which will take place. If a
(1)
Make arrangements as far
possible and advise man¬
as
who will act
as proxy.
is not appointed the man¬
ager has no alternative other than
to consider that the member is
committed to the bid and terms
account, and will not be
allotted any
tion.
additional participa¬
the
(3)
Please comment
syndicate
on
expenses?
down
expenses
to the prac¬
in
and
detail
item
each
of expense.
(4)
office
should
also
notify
syndicate
allocation procedures and the
handling of "priority" orders?
Each
on
with
manager,
the
ap¬
indicate
the
will
orders
the
release
in
manner
handled
be
the time of the setting of the
bid
is not
It
terms.
at
Why cannot the manager ar¬
simultaneous deliveries
issue in every city
range
of
new
a
in
which
an
office?
Although,
deliveries
the
practical.
to
members
and
period
(4) Be sure to exoress actual for. If
price and profit in sufficient time. broker
issues
have
longer
is
normal
than
by
the
cost
the banking
is
group
called
local customer pays his
a
on
a
reported
all
the
in
ac¬
require¬
loan.
SUBCOMMITTEE
ON
SYNDI¬
CATE
OPERATIONS OF THE
MUNICIPAL SECURITIES
COMMITTEE
John W. de Milhau,
Chairman
The Chase Manhattan Bank
York, N. Y.
Rucker Agee
Sterne, Agee & Leach
Birmingham, Ala.
Ernest J. Altgelt, Jr.
Harris Trust & Savings Bank
New York, N. Y.
P. Allen Bergquist
The First National Bank
H. Frank Burkholder
Equitable
Securities
Corp.
Nashville, Tenn.
William H. Hammond
Braun, Bosworth & Co.
Chicago, 111.
T. Norris Hitchman
Kenower, MacArthur & Co.
Detroit, Mich.
Arnold J. Kocurek
Rauscher, Pierce & Co., Inc.
San
Antonio, Tex.
Peter V. N. Philip
W. H. Morton &
Co., Inc.
York, N. Y.
the day of
Mercantile Trust Co.
na¬
generally
overhead
carry
of
have
simultaneous
a
on
a
of
and
with
of
loan of
limited extent, Thomas L. Ray
a
some
The
members
head office.
ments
New
of
been made
high
treated
cordance
a
such would have to
as
Chicago, 111.
Please comment
proval of the account, should make
the decision on this question and
(5)
member constitutes
a
original de¬
(5) Signify if willing to go with livery he should lose no interest.
and majority or file bid
limit. Do not request proxy to (6) Why doesn't the manager ad¬
St.
Louis, Mo.
Allen D. Sapp
Schmidt, Roberts & Parke
Philadelphia, Pa.
Brainerd H. Whitbeck
The First Boston
New York,
Cotp.
N. Y.
Edward B. Wulbern
manager
vance
make decision for you.
(6) File orders through proxv as
as possible especially if they
must be filed in writing.
of
If proxy
doesn't call
you—
behalf
syndicate
of members
any
good faith
deposit required?
soon
C7)
a
on
This
should
be
to the
discretion of the manager. How¬
subject
Pierce, Carrison, Wulbern, Inc.
Jacksonville, Fla.
Victor
H.
Zahner
Zahner &
Co.
Kansas City, Mo.
call him.
(8) Be responsible for expenses
or
arrange
i;S
reciprocal business.
Recognize that a proxy is
busy and in most in¬
stances is extending a favor.
(9)
probably
In order to
of
a
of
funds and
New
penses.
tionwide basis, it is not
(3) If operating through proxy
proxy
set by the
expedite settlement as promptly
possible after payment of ex¬
so.
branch
Arrangement
to
made
as
Concerning the Member
(4) Filing of subscription dur¬
ing order period.
(5)
be
proxy
(2) Should not have to ask
stranger to serve as proxy.
allotments when ready.
should
effort
and
not yet
ager
bring to the attention
membership
many
of the
details incidental to the relation¬
of-town member and the manager
ship of the member, the proxy and
do not function
the
properly.
make
(3)
Indication
of
additional
underwriting desired, if any.
group.
problem arises when the lines
majority
to
a deposit.
Although much book¬
keeping and use of funds might
be saved, an advance on behalf
Respectfully submitted.
with
made
drops out practical to have standardized or
should remain in meeting if bid¬ inflexible ryles covering all ac¬
counts.
ding limit of members he is proxy
ahead
and
manager
have
not
if
Even
set
by
present.
inite
which
decisions for members.
problem is far from being com¬
been made. It is difficult to reach
many
ever,
this
procedure
certainly
would negate the reasons for such
final
the
settlement
syndicate
members in a shorter period of
time than has taken place. A def¬
be
clearly
be avoided.
for
(1) Knowledge of his prelim¬
inary price views and indication
of any substantial interest.
of
made
tical
(3) Must communicate meeting
results promptly.
(8)
to
Manager
be
account members which will show
(7)
(9) Any other matters of
portance and urgency.
settlement
instances
many
hold
members.
orders filed.
the
In
(6) Private wire systems should should
Allotment of bonds against
final
Every effort should be made to
(5) Should call member collect.
From
Should
syndicate accounts
within 90 days of
sale?
proxy
(7) Members; added or dropped
B.
dictates
minimum, particularly those
connected with advertising.
A
(1) Should be qualified to at¬
statement should be furnished the
tend price meetings and willing to
pletely solved much progress has
this
although
of
Concerning the Proxy
C.
that
indication
for
copy
underwriting desired.
(2) Indication prior to the final
meeting of either a bidding limit
or an agreement to accept bid as
believe
We
that returned
so
(4) Limits given should be ob¬
served most closely.
(8)
(2)
selected and amount of additional
from the account.
In¬
out
ad¬
report
consist
bid
terms.
for the
ity
Final
send
act.
(4) Consensus of preliminary
bidding views and desired spread.
it may
Should
good business
that
it
is no
as
required.
cauld
syndicate
letters
as
early as possible so
suitable proxies may be selected.
(7) Make syndicate letters more
the B.
on
members
of
(6)
soon
be
views
small issues.
will
(1) Comment
wide¬
spread
to
Member
presented to It
for discussion.
The
Manager
price
(5) Should, when possible, take
its
the
to
as
To extend the
time for return beyond that nec¬
essary
can
in
many
instances
cause undue hardship.
all members.
member orders direct.
meetings and the Chairman
has attempted to keep its member¬
ship informed of the more impor¬
From
member.
(4) Should not call for proxies
on
Some of the desired information
and
final
and
each
entitled
Is
from
Chairman of the Municipal
Subcommittee on Syndicate Operations. The .Re¬
port of the Committee follows:
sev¬
from
(2) Must be able to make bid in
lockup meeting.
was
This subcommittee has held
complete
Needs
commitment
John W. de
Milhau, Executive Officer of the Munici¬
pal Bond Division of the Chase Manhattan Bank,
good faith deposit should be
returned
practice
Concerning the Manager
(1)
Syndicate Operations
concern¬
longer
A.
on
A
listed
are
below
manager,
and
which
should
1886
(10)
Observe
discretion and
good faith with information from
price meetings.
It is obvious from the foregoing
that
there
are
manv
varying
factors to be taken into account
and
that
no
absolutely
fixed
procedures
practical.
are
Three
How¬
Quarters of
a
Century
S
of Experience in Underwriting
there is little question that
ever,
1961
continuing discussion of this sub¬
has
ject
Vilas &. Hickey
heloful
and will be mo«?t
achieving greater
been
in
understanding
the
of
problems
Corporate and Municipal Securities
i
m
faced and the means of alleviating
MEMBERS
New
York
Stock
Midwest
them.
!
American Stock Exchange
Exchange
Stock
Exchange
V
Questions Referred to the
Subcommittee for Discussion
Many interesting questions have
been
year.
INDUSTRIAL
of
RAILROAD
PUBLIC UTILITY
SECURITIES
brought to the attention of
over the past
subcommittee
this
Brokers in
very
interest with
general
brief summary
of
some
E.HUTTON & CO.
W.
We list below some of those
more
a
and other leading exchanges
of
the incidental discussion concern¬
CINCINNATI
NEW YORK
ing them. In
the
same
a
number of
cases
questions have also been
submitted to other subcommittees
26
BROADWAY, NEW YORK 4, N. Y.
Telephone:
Teletype:
HAnover 2-7900
NY 1-911
Si:
Members New York Stock Exchange
additional
so
that
be
found
comment
Philadelphia • Baltimore • Dayton • Columbus • Mansfield
Lexington • Easton • Hartford • Portland * Lewiston • Bangor
Biddeford • Burlington • Washington • Hackensack »■ Wayne
Boston
•
may
W. E. HUTTON INTERNATIONAL INC.
in their reports.
London, England
(1)
Should good faith deposits be
returned within 30 days after
delivery and
liability?
elimination
of
•
Rome, Italy •
Monte Carlo, Monaco
1
34
The Commercial and Financial Chronicle
denominations,
Report of the IBA
Procedures Subcommittee
(1)
Where controlling constitu¬
tional
and
permit,
Walter W.
Craigie, Partner in F. W. Craigie & Co.,
Richmond, Va., submitted the following Report of
the Liasion and Bond Sale Procedures Subcommit-
tee, of which he was Chairman:
Numerous
changes in
procedures
time to time and
itially
are
sales
tors,
from
made available in
000 denominations.
for
consideration.'
this
of
Sub¬
committee has
been
that
any
in
change
tablished
es¬
b
e
r e c o m-
after
only
careful
consideration
all
of
impli¬
cations
for
Walter W.
investors,
Craigie
but that there
should be
Five
bonds.
the issuer, the
underwriter
and
tions
would
bulk
of
clipping
reluctance to depart
thousand
reduce
bonds
denomina¬
by
80%
the
and
from
coupons
task
the
of
coupon
bonds in
$1,000 denominations.
procedures when
On the-other hand, it appears
change will be con¬ essential that the market for mu¬
structive and helpful in the mar¬
nicipal bonds be broadened to in¬
keting of municipal bonds.
clude many investors who may
no
from established
a
statutory
where
provisions
The resolution of the
for
sale
the
advertised
municipal
of
public bids,
for
Forum
cal
the
the control of the issuer." The Lo¬
cal
Government
Executive
the American Bar Association ap¬
proved the report of its Commit¬
Board
of
of
the
M.F.O.A.
(5) Other Matters Referred to
Subcommittee
Other
referred
matters
Subcommittee
sidered
not
but
to
this
yet
con¬
by it include the follow¬
ing:
(a) What minimum amount of
good faith deposits should be re¬
quired by bidders, based on a per¬
centage of
par
value of the issue?
(b) When multi-purpose bonds
are sold as separate issues at the
same time and same place, should
they be awarded individually or
all-or-none basis?
on an
of
Section
Law
the
by
contract
the
of
terms
Section
Law
the American Bar Association and
by specific provisions in the notice
of
sale
(and in the bid form
where
Municipal
approved by the Lo¬
was
Government
(C) Do
requirements
for
"un¬
conditional bids" in notices of sale
have
detrimental
effects
bids
on
tee for Liaison with the
IBA, rec¬
by forcing bidders to accept un¬
ommending that each member of favorable conditions?
the Section give consideration to
(d) What financial responsibil¬
the provisions of this resolution
and take such action as he may ity should be required of bidders
to increase, it is important to pro¬ nominations as well as
$1,000 de¬
on
municipal bond issues?
deem appropriate to protect the
vide
any
feature which would nominations.
rights of the winning bidder and
lessen a deterrent and add an at¬
(6) Liaison Meetings
There
may
be difficulties in the issuer.
traction for large investors in such
Joint meetings of liaison com¬
providing for $5,000 denomina¬
pro¬
cedures should
mended
For holders of
bidder
otherwise
are established by the bid form).
practical and possible, issuers of
This resolution was also adopt¬
municipal bonds include in the
invitation for bids a provision re¬ ed by the Board of Governors of
the Municipal Forum this year. It
quiring bidders (and issuers of
municipal bonds sold in nego¬ was also adopted by the M.F.O.A.
tiated
transactions
permit the with the addition, to the provision
purchasing underwriter) to spe¬ with respect to the option of the
bidder
to
cancel
cify whether the issue shall be winning
printed and delivered in denomi¬ if delivery is not made by the
nations only of $5,000 or in de¬ specified date, of the qualification
"save and except a delay occa¬
nominations only of $1,000.
sioned by circumstances beyond
and
large amounts of bonds, the phys¬
ical bulk of bonds in $1,000 de¬
(2) In States where constitu¬
nominations
creates
a
storage tional or statutory provisions re¬
problem and the task of clipping quire that municipal bonds be
coupons from bonds in $1,000 de¬ issued only in $1,000 denomina¬
nominations
is
time
consuming tions, organizations interested in
and expensive.
With about $70 municipal financing cooperate in
billion of municipal bonds pres¬ efforts
to
obtain
the
necessary
ently outstanding and the volume amendments to permit the issu¬
of municipal financing continuing ance of such bonds in
$5,000 de¬
attitude
The
that
municipal
bonds
be
$5,000 demoninations, instead of the usual $1,-
referred in¬
Subcommittee
this
to
bond
proposed
are
delivery and advance notice
thereof terms of the contract, be¬
tween the issuer and the winning
to
bonds
recommend that:
we
Thursday, December 28, 1961
.
.
bankers to make these obligations
as
Since $5,000 denominations in
municipal bonds would be a fea¬
ture attractive to many investors,
Liaison and Bond Sale
■
in large is¬
even
sues.
.
proposed
tions in certain issues and it obvi¬
is
ously
vision
expected
not
will
be
that
(4)
pro¬
Supplemental Coupons
In 1960 this Subcommittee sub¬
for
made
$5,000
mitted a report on Supplemental
denominations where
the prob¬
Coupons, adopted by the Munici¬
lems are insurmountable.
pal Securities Committee and ap¬
Another approach to this prob¬
proved
by the
IBA
Board
of
lem is the possibility of making
Governors, concluding with rec¬
municipal bonds freely conver¬ ommendations that:
mittees of the Municipal Finance
Officers
Association,
the
Local
Government
American
the IBA have
year,
the
Section
of
the
Association,
the
Forum of New York
Municipal
and
Law
Bar
been held
this
in recent past years, at
annual
meetings of the
as
M.F.O.A., the American Bar Asso¬
denominations of
units smaller
(1) Impractical statutory pro¬ ciation and the IBA. We take this
$1,000
or
any
whole
multiple
(1) Denominations
than $5,000.
visions
or
For this reason, we thereof and
bidding requirements, opportunity to express our sincere
(b) as coupon bonds
There have been numerous sug¬ conclude that it would be unwise
which necessitate the use of sup¬
or to fully registered for principal
appreciation to the representa¬
plemental
recommend
that
coupons,
be changed tives of the other organizations
municipal and interest. These features are
gestions in recent years, particu¬ to
want
be
bonds
larly by large institutional inves-
tible
issued
only
in
$5,000
in
(a)
in
invest
to
attractive to
investors,
problems, one
which is the
expense
which
manv
investors
and issuers are unwilling to as¬
sume.
The City of Philadelphia
recently has provided that (a) its
coupon bearer bonds may be free¬
ly exchanged for fully registered
bonds in the denomination of $1,000 or any whole multiple thereof
and
(b)
that
fully
registered
bonds may be exchanged for cou¬
pon
bearer bonds of $1,000 de¬
nomination—at the expense of the
city. The experience in Philadel¬
phia will be helpful in further
consideration of this approach.
very
many
but they pose some
of the principal of
F. S. Smithers
ESTABLISHED
&
Go.
1857
MEMBERS
York
New
45
WALL
New York
Stock
Exchange
•
RUSS
STREET
BUILDING
(2) Award of Municipal Bonds at
1960 this
In
Telephone: GArfield 1-2851
Telephone: WHitehall 3-3300
Teletype: SF
Teletype: NY 1-1671
—
613
Subcommittee
rec¬
be
included
in
bid forms
a
of
cific
statement
sale
whether
on
the
on
February 24, 1961 adopted
a reso¬
lution
as
to
the
effect,
same
avoid
uncertainty
the part
on
or
of Michigan Corporation
meeting in August, 1961.
1960 this
In
Subcommittee
to
the
IBA
proved,
I
tract
Board
a
of
Governors
resolution that the
between
the
issuer
and
Walter W. Craigie,
F. W.
supplemental
coupons
recommended
in
their
that
notice
will be
Richmond, Va.
bids
providing
supplemental
for
of
Co., Inc.
Philadelphia, Pa.
Lloyd B. Hatcher
White, Weld & Co.
New
it
sale
a
or
New
McGee
Pressprich & Co.
York, N. Y.
Richard Morey
A. G. Edwards & Sons
St.
Louis, Mo.
Delmont K. Pfeffer
First
National City
York, N. Y.
New
Walter
&
Co.
New York, N. Y.
(2) "Bids
may
payable
designated
specify that the
for
as
by separate
George
coupons
additional
or
B.
Wendt
First National Bank of Chicago
period
any
Chicago, 111.
Alan K. Browne
Bank of America N.
sup¬
plemental coupons."
San
lic bids should
to
ap¬
con¬
the
obligate the seller
deliver the bonds by a
and
MEMBERS:
American Stock Exchange (Associate)
York Stock Exchange
Stock
Detroit
Exchange
Stock
Exchange
DETROIT
NEW YORK
CHICAGO
should
—
Grand Rapids
Birmingham
—
Battle Creek
—
Saginaw
—
Bay City
Muskegon
—
Port Huron
—
—
Flint
—
Lansing
Grosse Pointe
grant
Ingalls
the
winning
bidder an option to cancel his ob¬
ligation and to receive prompt re¬
fund
of
his
good faith deposit
check if delivery is not made by
the specified date.
The
Columbus
T. &
Francisco, Calif.
rec¬
specific
(preferably not later than 30
lays after the award of the bonds)
Midwest
Bank
Steel
H.
Drexel
re¬
jected.
interest
York, N. Y.
R. W.
in¬
will be
Ergood, Jr.
ac¬
purpose
additional
coupons
M.
Stroud &
Cushman
issuers
Chairman
Craigie & Co.
winning bidder for the sale of mu¬
nicipal bonds advertised for pub¬
SECURITIES
resolution
also
&
Snyder
give to the
winning bidder at least seven days
advance
notice
of
the
time
and
date of delivery and urged all is¬
suers,
attorneys
and
100
Members New York Stock
Exchange
Members
Exchange
American
Stock
BROADWAY, NEW YORK 5, N. Y.
provided
that the issuer should
investment
sound
Respectfully submitted,
ommended, and the Municipal Se¬
curities
Committee adopted and
MUNICIPAL
the
recom¬
facilitate
date
New
of
LIAISON AND BOND SALE
not bids providing for
sented in part
(3) Delivery of Municipal Bonds
mendations
of
bidders for municipal bonds, it is
desirable
for
issuers
to
specify
prior to maturity will be repre¬
its
consideration
municipal financing.
"RESOLVED, that in order to
Local Government Law Section of
at
in
Russell
the
Association
year
fol¬
lows:
clude
Bar
organizations for
PROCEDURES SUBCOMMITTEE
ap¬
American
those
supple¬
Municipal Forum of New York
Board
meeting in May, 1961 and by the
of
cooperation throughout
basis.
same
the
Governors
bodies
their
The Board of Governors of the
is
of
no¬
spe¬
and to the officers and governing
mental coupons will be permitted,
so that all bidders will be bidding
ceptable, and for this
IBA
using
for
or
tices
and
adopted
Finance Officers Association at its
CORPORATE
(2) There
can
basis
coupons.
Committee
Municipal Forum of New York in
February, 1961, by the Municipal
and
necessity
supplemental
bids
regular
a
curities
same resolution was adopted
by the Board of Governors of the
1
that
so
on
the
proved, a resolution urging issuers
provision similar in form to one
of municipal bonds to determine
of the following sentences:
promptly after receipt of bids
whether a bid will be acepted and,
(1) "Only one coupon will be
if a bid is accepted, to make a
attached to each bond for each in¬
prompt
written
award
of
the
stallment of interest thereon, and
bonds
to the
successful bidder.
104 Years —1961
STATE,
possible
submitted
ommended, and the Municipal Se¬
This
JIrst
be
without
whether
Public Sale
San Francisco 4, Calif.
5, N. Y.
1857
Exchange
American Stock
where
COrtlandt
7-6800Bell System
Teletype NY 1-1459
S. A.
Volume 194
Number 6l20
.
.
The Commercial and Financial Chronicle
.
submitted
Report of Subcommittee
On Trading and
Cashiering Procedures
W.
with
to
has
two
subjects
business.
our
year
been
the Sub¬
concerned
of
importance
September
est
uted
(2)
ipal Securities:
recommendations adopted
by the Municipal Securities Com¬
mittee
Nov.
28,
1960, and ap¬
proved by the Board of Governors
when carried
purchase
sale
for
trades
municipal
curities
in
to
be
figured
to
three
decimal
places, instead
of
six
was
as
problem thoroughly and sub¬
recommendations for various
several
effective
of
there
W.Neal
Fulkerson, Jr.
were
numerous
instances
where
because
uniform
different
Exchange
American Stock
MUNICIPAL BONDS
coun¬
cor¬
a
and
forgers.
it
seemed
available
to
bringing
sued by
recommendations
summary
Subcommittee
up-to-date
special
a
a report
is¬
committee in
the
Municipal Forum
of
New
Subcommittee agreed to
our
general approaches to the subject
first, a possible standard of
—
Emanuel, Deetjen & Co
ESTABLISHED 1929
MEMBERS
New
York Stock Exchange
and second, a
brief
guide for personnel han¬
dling municipal bonds which will
assist them in recognizing coun¬
to
to
sug¬
Exchange, Inc.
UNDERWRITERS—BROKERS—DEALERS
cost;
our
work
consulted
with
far
so
CORPORATE, MUNICIPAL & FOREIGN SECURITIES
have
we
interested
parties including state and local
officials, municipal bond attor¬
neys, indemnity companies, bank
note companies and commercial
gested methods. This material was
Stock Exchange
Commodity
securities.
terfeit
In
American
Midwest Stock Exchange
specifications for printing munici¬
pal bonds
which
will
provide
maximum
practical security
at
more
of
The
jointly with this group in a
review of the problem. Our study
is
being conducted under two
prob¬
a
more
a
counterfeiters
work
figuring mu¬
nicipal transactions, the Subcom¬
prepared
of
become
for
Since
the
subject
was
also
being considered by a committee
lems encountered in
has
Street, New York 4, N. Y.
Telephone DIgby 4-4100
1934.
members
most all of the usual
25 Broad
was
requested
to
review
the
problem and consider revising or
re¬
advisable
our
growing
dealers
rapidly
municipal
our
volume
might
reasonable
comprehensive
methods
figuring
that
field
of
mittee
dis¬
crepancies resulted in figuring in¬
voices
expanding
figuring which would
additional
date
Exchange
Members
Authority
issuers,
among
securities
York
cover
this
disclosed
was
bonds of
as
attractive
always
Since
weeks
it
Turnpike
investors
This group
have
For
following
and
eliminate these dis¬
mit
since
1.
Members New York Stock
Forged Munic¬
or
year
well
as
concern
only three
the
producing
Jan.
to
dealer-bank firms to explore
sults.
effect
Bacon, Stevenson & Co.
pam¬
Securities:
Ohio
bonds
and
have
in
the
distrib¬
porate issue had turned up in the
crepancies the Subcommittee ap¬
pointed a group of senior opera¬
tions personnel from major dealer
formerly done,
been
be
substantial amount of
a
terfeit
Gushee, President of the Finan¬
cial
Publishing
Company.
The
Group's
recommendations
were
approved and released to the IBA
membership on March 31
and
have apparently been effective in
se¬
approved,
will
V
Counterfeit
that
produce identical results.
received excellent co¬
operation from Mr. Charles H.
and
invoices
If
the membership in
ipal
places.
order to
methods
providing for
to
Early this
computing basis prices which
been in general use failed to
produce uniform results in some
In
The
com¬
phlet form.
of
cases
Transactions in Munic¬
on
28.
recommendations
had
Recommendations for Compu¬
tation of Principal and Inter¬
and
market. This added to the
decimal
(1)
review
Governors and the Municipal Se¬
curities Committee under date of
Fulkerson, Jr., Vice-President in Charge
oj the Municipal Bond Department of the Bankers
Trust Co., New York
City, was Chairman of the
Municipal Subcommittee on Trading and Cashier¬
ing Procedures. Its Report follows:
committee
for
ment to members of the Board of
Neal
During the current
35
banks. The
many
120
Broadway
,
'
New York 5, N. Y.
\
Ej
Teletype: NY 1-1973
CO.J
Telephone DIgby 9-0777
)
Cable Address:
EMANSTOCK
Municipal Finance Of¬
ficers Association is
ested in the
greatly inter¬
problem and will un¬
doubtedly work with us through
Emanuel, Deetjen S.A.
Emanuel, Deetjen S.A.
10 Avenue De La Gare
Via Durini 28
the
Lausanne, Switzerland
Milan, Italy
respective
when
final
liason
committees
recommendations
Emanuel, Deetjen & Co. Ltd.
Roots
Bldg.
Nassau, Bahamas
are
On October 6 we sub¬
groups
of municipal
bond
attorneys and bank note
companies
a
suggested
set
of
proposed.
Shields & Company
mitted
to
specifications for review and
It
ment.
Underwriters
Distributors
report
is
hope that
our
may
be
final
issued early
next
I year.
The
been
tice
of
Subcommittee
asked
to
dealers
of
offering
issues of bonds
more
package
none
also
had
Municipal
at
as
to
prac¬
two
or
all-or-
an
single
a
opportunity
an
has
consider the
The Subcommittee has not
Industrial and
com¬
a
CORPORATE
price.
yet
consider
as
and
that question.
MUNICIPAL
Respectfully submitted,
MUNICIPAL
Securities
SUBCOMMITTEE
UNDERWRITING
ON TRADING AND CASHIER¬
ING
PROCEDURES
W. Neil Fulkerson,
•
Jr., Chairman
Bankers Trust Co.
New
J O.
Merrill
New
Pierce,
PLACEMENTS
Fenner
York, N. Y.
William
DISTRIBUTORS
Lynch,
Smith Inc.
&
UNDERWRITERS AND
PRIVATE
York, N. Y.
V. Cecil
G.
Harding
Coffin &
Burr, Inc.
Boston, Mass.
Lloyd R. Hatcher
White, Weld & Co.
White, Weld & Co.
New York, N. Y.
CORPORATE FINANCING
■
David
MEMBERS
NEW
YORK
STOCK
EXCHANGE
Miralia
T.
•
Kuhn, Loeb & Co.
New York, N. Y.
MUNICIPAL AND CORPORATE
William
F.
20
Robert
•
G.
BOSTON
Davis
F.
Don
LOS
Farrell
City National Bank & Trust Co.
Members:
Hartford, Conn.
Passaic, N. J.
Kansas
Arthur
•
American Stock Exchange
Los Angeles, Calif.
Philadelphia, Pa.
The
First Boston
Pittsburgh, Pa.
D.
Corp.
Trust
Co.
Chicago, 111.
Russell
E.
Siefert
Stern Brothers
Kansas
&
City, Mo.
FRANCISCO
LONDON
McGrew
Northern
SAN
ANGELES
.
Kirtley
Chicago, 111.
The
Maplewood, N. J.
City, Mo.
E.
Edward
YORK
PHILADELPHIA
Minneapolis, Minn.
PRIVATE PLACEMENTS
Van Alstyne, Noel & Co.
NEW
CHICAGO
Piper, Jaffray & Hop wood
NEW
STREET,
Blyth & Co., Inc.
New York, N. Y.
SECURITIES
New York Stock Exchange
BROAD
Morgan
Co.
ZURICH
YORK 5
36
The Commercial and Financial Chronicle
interest. The New Executive Sec¬
Report of Subcommittee
retary of the Association also
on
appreciate the value of
closer liaison of the two organiza¬
Liaison With the ABTTA
tions.
Morgan, Vice-President of Blyth & Co.,
Inc., New York City, was Chairman of the Subcom¬
mittee on Liaison with the American
Bridge, Tunnel
and Turnpike Association and
reported to the Con¬
vention as follows:
New
ON
WITH
The
Subcommittee
Alan K.
the
Browne
American
Turnpike
s o
i
c
by
Vice-President John Pershing and
Chairman
Executive Secretary W. A. Rusch
of the ABTTA in New York to
for liaison
Bridge
with
Tunnel
discuss
&
As-
t i
a
appointed
Committee
son
o n
the
ABTTA) has
rela¬
a
tively
un¬
eventful
year.
son
attendance.
position,
large ex¬
tent, has been
a
which
neither
the
Subcommittee.
ABTTA
W. F.
has
had
con¬
and
includes
of
Morgan
the
the
following:
(a) The ABTTA for a substan¬
portion of the year had no
active
executive
secretary
(for
approximately six months of the
current year).
the
On
Oct.
mittee
with
with
had
For
assist
to
President
Frank
ABTTA in
improved
secure
of
use
reporting
its
and
standardized
for
toll
road
Pershing, President-
is
well
acquainted
is
aware
of the
wish
of
the
IBA
to cooperate on matters of mutual
Horty,
Municipalities considering financsave substantial amounts
of money and avoid serious
prob-
advice
is
available
for
the
instance,
be
the
is¬
issuance
bond
engaged
named
First
Municipalities
in
the
counsel
by the issuer
financial
ad¬
m
unicipaliwhich
Frank
than
for
bid
at
will
be
public
Thornton, Mohr and Farish, Inc.
Montgomery, Ala.
Donald W. Moulton
R.
sale,
be
H.
Los
Moulton & Company,
Angeles, Calif.
t
George T. Ragsdale
Lehman
adver¬
New
Brothers
York, N. Y.
or
on
Joseph Refsnes
a
Refsnes, Ely, Beck & Co.
other
someone
financial
will
C. Carr
Chicago, 111.
particular financing,
bonds
the
advisor
mentary plan¬
ning and basic
well
a
the
negotiated basis to
ele¬
procedures,
For
Southwest Co.
Sidney J. Mohr, Jr.
bond charge.
(2)
FINAN¬
John Nuveen & Co.
where the bonds will be sold
assist¬
on
per
tised
ties,
ance
a
ON
ADVISORS FOR
Dallas, Tex.
type of service might be a fixed
amount, an annual retainer, or, if
the issuance of bonds is involved,,
where
smallest
need
with
by
MUNICIPALITIES
Jackson, Jr., President of First South¬
Co., Dallas, as Chairman of the group, sub¬
mitted the following
Report of the Subcommittee
on Financial Advisors
for Municipalities.
the
investment banking activities and
meeting
J.
the
cost
William C. Jackson, Jr., Chairman
west
lems by obtaining expert financial
advice. Such
will
engaged
with
CIAL
in
Association.
as
perform legal services in
SUBCOMMITTEE
William C.
evi¬
IBA
advisor,
compensated
cording to the extent of the
Phoenix, Ariz.
the
Walter H.
ac¬
Drexel
New
serv¬
Steel
&
Co.
York, N. Y.
as
the
as
largest
m
unicipalities,
which
Established 1856
need
highly
specialized
advice
H.HENTZ&CO.
W. C.
we
Jackson, Jr.
Expert
be
leading stock and commodity exchanges
offer.
•
«
in¬
on
terest rates and market conditions.
Members New York Stock Exchange and other
financial
obtained
advice
from
should
investment
an
banker. Not only is he best
quali¬
on
matters such as current
market
conditions
and
interest
over
fifty years9 experience
as
underwriters,
dealers, and distributors of all types of securities.
fied
Main
Office
72 WALL ST., N. Y. C., BO
New York
9-8420
rates,
1430 Broadway (PE 6-9600)
&
but
he
is
most
familiar
with
City Branches
Sherry Netherland Hotel (PL 1-2220)
the requirements of various
types of investors as to maturities,
rates, options, and other pertinent
facts
CHICAGO
•
BOSTON
MIAMI, FLA.
•
•
PITTSBURGH
BOCA RATON
ODESSA, TEX.
•
AMSTERDAM
•
•
DETROIT
MIDLAND, TEX
•
•
BEVERLY HILLS
CORAL GABLES
LONDON
•
BUENOS AIRES
•
•
SAO PAULO
MIAMI BEACH
•
HOLLYWOOD, FLA.
•
PARIS
•
•
GENEVA
HONG KONG
which
of
Corporate Securities
will
result
municipality
receiving
possible bids
on
the
in
the
the best
securities to
public utilities
industrials
railroads
tax-exempts
new
mergers
financing
secondaries
private placements
be
sold. Just as an engineer is
employed to prepare the engineer¬
ing surveys, and an attorney is
employed
Underwriters and Distributors
to
the
prepare
W. C.
Langley & Co.
Members New York Shock
legal
proceedings and render a market
opinion, an investment banker
Some
of
of
a
115
Broadway, New York 6, N. Y.
Telephone: BArclay 7-8800
BOSTON
the
Exchange
Established 1909
should be employed as
early as
possible to provide sound financial
advice.
tions
SYRACUSE
•
Teletype: NY 1-4176
•
PHILADELPHIA
important func¬
financial
advisor in¬
clude: making a
survey of the
financial resources of the munici¬
UNDERWRITERS and DISTRIBUTORS
pality; recommendation of a plan
of financing
designed to obtain
the
needed
funds
the
on
most
favorable basis; the selection of
for
Railroad Securities, Municipal Bonds
receiving bids; the preparation
information
needed
the preparation of
by
all
in
the
a
by bidders;
Prospectus to
information
bidders and
ance
Unlisted Securities
Corporate
and
Municipal Securities
of the Notice of Sale to include all
include
Bank and Insurance Stocks
Underwriters and Distributors
a
date when the market is favorable
Industrial, Public Utility and
expected
Specialists in Rights and "When Issued" Securities
investors; assist¬
tabulation
and
com¬
parison of bids; and arranging for
the printing and delivery of the
bonds.
Institutional Research for
Banks and Institutional Investors
Financial
Laird, Bis sell B Meeds
Members New York and American Stock
120
BROADWAY, NEW YORK 5,
Telephone BArclay 7S500
WILMINGTON, DEL.
SALISBURY, MD.
DALLAS, TEX.
N.
Y.
Bell Teletype NY 1-124849
PHILADELPHIA, PA.
SALEM, N. J.
advisory service for
municipalities is usually provided
under one of the following two
arrangements:
Exchanges
NEW
HAVEN, CONN.
DOVER, DEL.
ZURICH, SWITZERLAND
to
may
Respectfully submitted,
on
Financial Advisors
tee
1961-62,
Subcom¬
luncheon
a
the
to
Elect of the ABTTA for the
year
subsequent
the
1961
of
the
to
every
Report of Subcommittee
ing might
projects.
Mr, John
organization.
19,
York, N. Y.
and
meetings
order
ar¬
visory contract.
attended
of
attorney
should
At this meeting a plan was worked
out whereby the IBA Subcommit¬
efforts
ecutive Office to Washington ear¬
in
interest
additional
(b) The ABTTA moved its Ex¬
They
such
expenses,
connection
this
by those in
committee
activities
interim
year
and
ABTTA
dence
the
tial
difficulties of
considered
were
business
trol
this
At
attended by three members of the
Committee dor
lier
Association.
The 29th Annual Convention of
the ABTTA in Philadelphia was
to factors
the
New
above
and/or approval of the bonds. In
Drexel & Co.
York, N. Y.
respect and plans, meth¬
ods, and hopes for improving liai¬
to
due
the
suer
York, N. Y.
improving liai¬
in every
This
over
New
the
compensation
of reports of engineers and fees of
Walter H. Steel
•
of
the
paifi the financial advisor
of various
the
sometimes
had
with the
F. Morgan, Chairman
Blyth & Co., Inc.
meeting, plans of the ABTTA for
future, changes with respect
to its objectives, and its conven¬
tion in Philadelphia on Nov. 12,
through 17 were discussed thor¬
oughly. The meeting was friendly
(hereinafter
called
of
means
W.
either
be made to include reimbursement
Co.
York, N. Y.
Lehman Brothers
New
ABTTA
Municipal
be
George T. Ragsdale
THE
rendered, taking into
type of bond and size
rangements,
George J. Gruner
New
SUBCOMMITTEE
LIAISON
Under
& Co.
York, N. Y.
John Nuveen &
be
to
of the issue.
Walter W. Friend, Jr.
Respectfully submitted,
MUNICIPAL
ices
account the
Smith, Barney & Co.
York, N. Y.
R. W. Pressprich
feels that the outlook is favorable
for improved liaison with the
ABTTA during the coming year.
Thursday, December 28, 1961
New
Accordingly, the Subcommittee
William F.
.
.
Winthrop S. Curvin
ap¬
to
pears
.
(1) For continued counseling on
financial matters not limited to
any
particular financing
retainer basis.
tax rates, utility
charter provisions,
as
for
the
funds.
investment
rates,
or
of
a
on
—
Counseling
on
basis might involve matters
than the issuance of bonds,
a
T) ONNELL & CO.
INCORPORATED
Established 1905
Members New York Stock E:
this
oth^r
sucn
budget^,
program
municipal
The compensation for
MC
this
vkange—American Stock Exchange
120 Broadway
Chicago
New York 5
Detroit
San Francisco
Uptown:
A VITAL
250 Park Avenue
Denver
Newark
INVESTMENT
ANALYSIS
Los Angeles
Volume 194
Number
6120
,
.
The Commercial and Financial Chronicle
.
it
Report of Municipal
will
Ergood, Jr., Vice-President of Stroud &
Co., Inc., Philadelphia, in his capacity as Chairman
of the Municipal Conference Subcommittee, ad¬
vised the Convention as
follows:
mittee
Conference
com¬
charged with the task
of studying the necessity of an an¬
was
nual I.B.A.
where
time
Municipal Conference
more
made
able
of the munic¬
discuss
ated
the
and
t remendous
increase
of
uations
Mu¬
today.
Ergood, Jr.
the volume of
municipal
bonds
new
has
issues of
increased
approximately $3,278,000,000
$7,900,000,000.
Our
committee
is
composed of
capable representatives of our in¬
dustry
representing
large
out.
that
aware
We
this
and will not
not
with
way
and
Conference
Conference
be
financially
nar
should be held
will
on
committee
and the
This
but
to
coast
Great Lakes to the
Gulf.
was
is
coast
from
not
just by good fortune
by design because the prob¬
lem which
out
given to work
everyone
in
this
we were
concerns
great land of ours interested and
involved
in municipal finance.
thoroughly sampling
opinions in various sections
After
many
the
of
found that
greatly in
favor of having this Conference
provided, however, it was held
completely under the I.B.A. um¬
most
country,
It
brella.
many
are
we
everyone
also
was
to
came
light that
members of the I.B.A. who
in
municipal fi¬
interested
to
send
their municipal men to the
con¬
nance
have
vention
been
to
due
unable
the
limitation
the
who
an
individual
firm. In
all
create
interest and
Therefore,
probability,
greater
this
grass-root
participation.
our committee
will
big
these problems.
On
our
(1) The first Annual Municipal
be held prior to the
Subsequent
Florida
the
or
under
various
(3)
First
that
be
be
the
I.B.A.
recommended
Group
Annual
either
can
type
Chairman
Russell
M.
Logan V. Pratt
R.
Confer¬
J.
S.
Dickson
We
are
Seasongood & Mayer
Cincinnati, Ohio
I.B.A. firms and not the
thus
enabling
a
New
Altgelt, Jr.
Victor
York, N. Y.
H.
Zahner
Harris Trust & Savings Bank
Zahner & Co.
New
Kansas City, Mo.
York, N. Y.
pleased to
announce
of
a
to Municipal Bond Dealers
under¬
taking of national problems
through greater geographic scope.
After
we
have had
Conference
nicipal
benefits
to
the
proven,
to
it
is
make
it
our
an
This
new
teletype network
After realizing
the benefits that
represents a major step in our continu¬
ing effort to facilitate the market operations of dealers and dealer
banks in the
affair.
annual
will
first Mu¬
prior
Convention and the
annual I.B.A.
many
our
The
municipal bond field.
opening of this
new
channel has enabled
us to
out of this Conference,
come
of municipal bonds
the offices of
★
to prospective
which he
United States
★
'f/.v
Government
can
buyers.
large nupiber of active dealers. Each dealer is
matically provided by teletype with
★
greatly speed
procedure essential details arrive simultaneously in
a
a
auto¬
list of available bonds for
readily bid.
We believe this
to
be
a
significant breakthrough in the historical
development of the secondary market. Any sound procedure which
effectively speeds the purchase and sale of bonds is destined
Federal Agency
have
a
beneficial effect upon
State
★
and
Municipal
★
★
Securities
★
★
*
*
C. J. DEVINE & CO.
48 Wall Street, New
Chicago
•
Boston
Cleveland
•
•
HAnover 2-2727
York 5
Philadelphia
Cincinnati
•
•
Washington
St. Louis
Direct Wires to all Offices
•
•
Pittsburgh
San Francisco
J. J. KENNY CO.
BROKERS FOR DEALERS AND
,
DEALER BANKS EXCLUSIVELY
DIgby 4-9440
to
the entire municipal bond market.
★
★
Co.
Western New York
minority,
broader
,
Fred D. Stone, Jr.
The Marine Trust
Teletype Network
can
Co.
Gordon Reis, Jr.
Co., Inc.
the establishment
qualified
IN
★
&
Charlotte, N. C.
Philadelphia, Pa.
Ernest
Under this
★
Moroney, Beissner & Co.
Houston, Tex.
you.
Ergood, Jr., Chairman
Stroud &
the
Committee.
Municipal
a
Co., Inc.
Robert E. Moroney
of
been
COMMITTEE
In order to implement the
Annual
has
G. Becker &
Chicago, 111.
MUNICIPAL SECURITIES
of
to
members
it
serve
solving
CONFERENCE
SUBCOMMITTEE OF THE
at
auspices of
It is
this
the
in
A.
and
MUNICIPAL
groups.
referred
of
part
can
Respectfully submitted,
Con¬
held
behalf
pleasure to
Annual Convention in Florida.
(2)
a
committee,
Conference
ferences
Conference
play
Friend
Elmer G. Hassman
business
rec¬
ommends:
the exposure
SPECIALISTS
usages of the municipal bond
business, and better communica¬
Municipal
S.
Folger, Nolan, FlemingW. B. Hibbs & Co., Inc.
Washington, D. C.
and
tions between all segments of our
is important.
An I.B.A.
Francisco, Calif.
Arthur
on
to attend the
continue their
stay when the regular convention
starts Sunday afternoon and those
who
would be
present for the
Conference only would thereafter
not be a part of the convention.
This plan would supplement the
existing setup and give municipal
representation of the majority of
are
convention,
the total number permitted to at¬
tend from
In
The problems of our fifty states
their laws plus local customs
and
Sunday
afternoon. Those people who are
interested in municipal securities,
Municipal Forum
recommendation
on
opinions.
San
Friday and
ida. This seminar could close with
the
participa¬
expression of individual
and
also
regular I.B.A. Convention in Flor¬
of
regular programs
& Smith Inc.
tee.
but
encourage
self-supporting.
After careful study, our com¬
mittee feels that a two-day semi¬
country. In fact, the
geographical
coverage
of
this
tions
various
would
by the Chairman of
Municipal Securities Commit¬
any
Saturday prior to the start of the
from
be
course
Committee be
appointed
Stifel, Nicolaus & Co., Inc.
St. Louis, Mo.
Harvey J. Franklin
Merrill Lynch, Pierce, Fenner
can¬
interfere in
and
dealers
of
members
Annual Conference
the
E. William Darmstatter
thoroughly
are
sec¬
small
I.B.A.
ence,
our
committee
offers
its
services toward this objective, and
it is further recommended that an
of the I.B.A. func¬
any
This
tions.
conflicts
certain
circumvented
be
worked
from
to
to
had
R. M.
In the last ten
years,
all
when and how sit¬
more
complex due
that
fact
Municipal
a
from
would,
all
Conference
were
the
to
nicipal Fi¬
nance
at
not
were
how?
The where,
in
volume in the
field
reactions
Conference.
acceptance, we moved
into the questions of where, when
cre¬
by
Municipal
a
national
more
problems
the I.B.A. passed a reso¬
strongly
supporting
the
was
the
many,
Municipal Conference. It is
interesting to note that the
of
so
days with
that
surprising as the entire committee
strongly in favor of this Con¬
ference. With this overwhelming
and
study
two
would
These
ipal people to
to
I.B.A.
idea
that
I.B.A.
country
ferent
tion
lution
more
the
appeal to the municipal element.
The Conference could be one or
group of
avail¬
for
various
host
year to
it would take place in dif¬
geographical areas. Such
year
open
Executive Committee of the Texas
could be
to
Conference
most all of these cases, these firms
would send representatives to an
also
that
throughout
want
Conferences
Russell M.
Municipal
likely
groups
Conference Subcommittee
The
is
37
*
NY 1-5010
of
38
Chronicle
The Commercial and Financial
.
.
.
Thursday, December 28,
their
city
brothers.
complicating the areawide relationships between serv¬
ices and revenues in metropolitan
areas is the great number of in¬
dependent and overlapping local
government units. City incorpora¬
tions to promote special economic
interests have been cited, plus the
problem created by over 2,000
independent governing bodies
now
functioning in California's
nine metropolitan areas.
service
Subcommittee's Report on
Orlando
S.
Brewer, Partner, Phelps, Fenn & Co.,
City, in the role of Chairman of the
Subcommittee
on
Metropolitan Area Problems,
York
submitted
Malvern Hill & Company
INCORPORATED
MUNICIPAL
115
NEW
In
recent
of
studies
seeking
politan
BONDS
6,
N.
large
a
have
solution
a
the
to
problems
area
number
conducted
been
metro-
trans-
of
portation,
schooling,
BROADWAY
YORK
accompanying Report to the Convention:
years
Y.
water,
sewers
and
multi¬
a
tude
of
include two
by
short, there now exist area-wide
complexes with wide-area problems, and needs which are beyond
the capacity of one or a few of
of these prob¬
lems can be
attributed
acute and
to
ulation
that
areas
spreading
be¬
(Jrlando
the
iitical
"boundaries
po-
form
problems
when
tion
the
hasp
is
in
the
migration
urban
to
the
suburban
parent
ists.
to
the
that
no
p
taking
of
the
and
the
is
ap-
solution
ex-
urban.
easy
c
considera-
that
place
suburban
p
magnified
into
enigma
cities
t h
further
takes
one
of
thpir
are
the
It
However, in seeking
rem-
a
edy three general problems which
ICIPAL BONDS
y':'-. l'''
DIRECT
WIRE
TO
■.
■
CHICAGO,
MIAMI,
'
v.
;;
:
v
.-.Ov
-v.
invariably will be
are:
to
furnish the
facility or
service, (2) the division of political authority
among the various
governmental
BOSTON
considered
(1) the appropriate governmental
unit
units
within
the
area, and (3) the means of finane-
ing the facilities
services.
or
.ve general approaches determining the appropriate unit to
-.
provide
B. J. VAN INGEN & CO.
inc.
area-wide
been proposed.
WALL
STREET,
NEW YORK 5,
N. Y.
•
Telephone: HAnover 2-9353
as
*
MIAMI
*
BOSTON
rapid
or
water
Port
Metropolitan
Southern
new
District
on
problems
mounting with
are
increases.
California's
It
is
of
federation
regional basis
a
as
governmental entity,
to
the various local govern-
mental units within the area surrender
authority to deal with
specified functions (for
1961
(3)
A
tions
shift
to
of
specified
area-wide
an
wjde
matters
can
be presented,
discussed, decided and acted upon
on
area-wide
an
basis,
ANGELES
are
California transport plan.
pop-
the
MARKETS
Council has proposed a Transport
Authority to coordinate transport
planning and, where necessary,
are added. If this rate of increase transport development and operacreases
population ina day, that
people
by 1,500 people
continues,
California
will
tion
meet
an<* exceed New York State as
the most P°Pulous state in the nation by I962- In common with national trends 85% of this growth
occurs in metropolitan areas. By
1980 California will have an estimate? 39 million persons; about
28 ^Uion will live in one metroPolitan area or another.
labor force increase from 3.5 million to 6.7 million by 1980.
MPTA, as proposed, would be
by the State Legislature,
created
but controlled
function.
would
q£
were
pavins much
more
city
and
were
not
these
same
a
~
MPTAs>
from
by
one
the
mem-
Governor,
member representing the
entity which encompasses
area
(for
example,
County, Florida).
(4)
in
Annexation
or
consolidation
of entities.
power to hire comPetent professional Planners and to levy taxes
to finance its operations. With
completion of the plan> lt would
receive bonding powers, the right
of eminent domain, and authority
for
to operate mass transit facilities
wlth the Los Angeies Metropolitan
central
residents
Transport
operating
receiving the quality of
Authority
agency.
as
its first
According to
(5) Joint exercise of powers
through contractual arrangements
OVER-THE-COUNTER
for services.
This report does not propose to
cover all of the
developments re¬
SECURITIES
Established 1928
J
We have for 33
reports
Members New York Security
Dealers Association
principal
PRIVATE
WIRE
Beach, Fla.
SYSTEM
CHICAGO—First Securities Company of Chicago
many
problems.
explosion
A
sion
of
tan
problems
California
recent
for
Metropoli¬
brought to light
are
plaguing
now
will continue to do
and
distant future
this
state's
the
so
as
state
Your
in the
a
SAN FRANCISCO—Mitchum, Jones & Templeton
in
Direct
cities has increased to 368, but in
one
politan
Philadelphia-WAlnut 2-1514
or
this
spite of this,
ber of the
population,
a
The
number
tremendous
p.
f.
live
another of nine metro¬
areas.
respectfully solicited.
of
to
of
are
near
result
population explosion.
California today has 15^ million
people. Almost 14 million, or close
90%
inquiries in these divisions of the Investment
Securities Business
and
LOS ANGELES—Mitchum, Jones & Templeton
private telephone:
Oil and Gas stocks
study by the Governor's Commis¬
various and sundry problems that
Miami
Utility and Industrial securities
•
California population
J
Teletype NY 1-1126-7
Branch Office:
analytical
CALIFORNIA
Street, New York 5, N. Y.
Tel. HA 2-4850
Retail
Interesting growth securities
•
suggested.
poses
37 Wall
to
descriptive of—•
illustrative of the
problems involved and the solu¬
tions
special service
a
them with information supplemented
by pertinent
developments
SreeueaniCompcauj
offered
Organizations, Investment Trusts, and Institutions, furnishing
garding metropolitan area prob¬
lems, but it includes simply a
summary of some of the
^
years
of
num¬
people living in metro-
120
fox
&
CO., inc.
BROADWAY, NEW YORK 5, N. Y.
Telephone
REctor
2-7760
In
first
phase of activity,
that of developing a master transPort Plan- u would be granted
ffre ^otlction waTer sa^ftation
A?
e?c- than residents of
appointed
d
!?as founT that
that manvSuburban
many suburban
area
member
SSffd®
It
area
one
county supervisors
ber
serviees received
laveln®1ironolitan
include
Authority would
directing
board
participating counties
appointed by the respective boards
2
thrievel^f
The
eacb of the
in
£al c<ontrol by the citiMn The
and
by the five counties
within which the
W* the loss of polit-
M
1L A
California
is emphasized by the Counprojection of a population
increase in the region from 9
million to 17 million, and a total
taxes
ond level of services throughout a
metropolitan area; inequities aggravated by complexities in local
*
®
Southern
cil's
mg treatment and solution on an
area-wide basis. These problems
include regional planning; metropolitan transportation; pollution
of the water and air; regional and
interregional water supply and
inequities
the
area
The Commission reported there
are a number of problems requir-
distribution;
in
region. The need for a balanced
system of transport in the region
experiencing the concentric expansion of the Los Angeles urban
func¬
entire
Dade
The
Southern California Research
estimated
govern¬
mental
TRADING
an
problems, it
is the establishment in
metropolitan communities of an
area-wide organization or framework through which truly area-
example,
the Municipality of
Metropolitan
Toronto).
1930
re¬
to
government
area-wide
com-
appears
In
was foundI
metropolitan
organized
which
Water
California).
(2) A
a
transit
P( tr Authority
fx?umplf' the
New
and
the
vTbYork
CHICAGO
have
trict
such
40
services
(1) A special authority or disto deal on a
regional basis
with a single or limited function
ESTABLISHED 1917
of
a
each year one half million
yond
which
S. Brewer
counties.
more
on
jng the metropolitan
L0S
These
metropol¬
itan
STATE, GENERAL MARKET AND PUBLIC REVENUE
units
solve.
the
Distributors
local
or
transportation,
pollution cannot
area-wide basis. The key to solv-
state
re¬
of
air
munity basis concludes the
port> they will and can be on
metro-
the
in
services
dotting the
nation. Many
•
the
of
quired
communities
Underwriters
Half
communities
and
and will not be solved
of people and their daily
living activities — has expanded
beyond municipal boundaries, and
in
several
cases,
has
crossed
boundaries.
mushrooming
Problems
water
lions
politan
other
not live within
communities. The
community — mil-
politan areas do
incorporated
metropolitan
as
Further
Metropolitan Area Problems
New
196i
Teletypes
NY
1-944
&
NY
1-945
Volume
John
194
Number
6120
.
The Commercial and Financial Chronicle
.
C. Senholzi,
Chase Manhattan Bank, New York; Mrs. Claude D.
Seibert, New York;
Muir, Dempsey-Tegeler & Co., Inc., San Antonio; Claude D. Seibert,
Commercial & Financial Chronicle, New York
the
plan, local governments will
autonomy for local plan¬
ning, while using the special dis¬
retain
trict
organization
cooperation
of
.
the
for
region
could
be
as
as
the
a
later
tool
a
whole.
MPTA
expanded
graphically or developed
multi-purpose district as
mended
of
development
geo¬
into
a
recom¬
by the Governor's Com¬
mission
Metropolitan
on
Area
Problems.
The
that
Council
the
in
the
California
recommended
proposed
Authority's
San
Francisco
benefits will reach $42,000,000 an¬
nually. Benefits will
accrue
from
savings in travel time, in freight
movements, in accident incidence,
The proposed five-county, 120mile
system will consist of 20
ways
or
express
lanes, of airport
routes, and of
pose transit centers.
access
SAN
multi-pur-
FRANCISCO
Millions in benefits expected of
Bay Transit. In 1975, within three
years
of
the
proposed
regional
transit system's entering full oper¬
traffic
$1,078,000,000
$133,000,000
for
trans-bay tube
provided for from
Bay
Bridge automobile
1980, the systems will be
carrying more than 127,000,000
passengers
annually and produc¬
ing
revenues
gross
close
of
to
$47,000,000.
The
earnings
will
surplus of more than
$5,000,000 after paying operating
expenses and initial debt costs.
leave
of
plan will provide the im¬
for
greater
county-wide
Financial
Solution
problems
a
to
This
lies
Baltimore's
in
the
transit
adoption
of
Metropolitan
Authority.
The
Baltimore
Metropolitan
Area
Mass Transit Legislative Commis¬
sion, in an effort to develop a
program that would help alleviate
the
Baltimore
area's
transportation
chronic
problem,
mended
the
politan
transportation
creation
of
recom¬
metro¬
a
advisors
of
the
to
own
and
operate
authority
the
makes
present
recommendation
provision for the con¬
traffic, parking and plan¬
ning by the authority. It has,
however, been endowed with reg¬
ulatory powers, the right of emi¬
trol
no
of
nent
domain
the
and
power
ing
San
and
a
Immediate
ownership and oper¬
by the authority of a mass
system has not been pro¬
vided for. In fact, there is a man¬
datory two-year moratorium on
ation
transit
Continued
mass
on
Francisco
beneath
the
and
link
present
system. The tax bill of
Bay area
approxi¬
mately $4 during the initial years
of construction, which are
planned for 1963-1964, $26 after
Oakland,
homeowner
suspended
deck
of
the
Golden Gate Bridge. The network
will
comprise
five
main
the
transit
will
120-mile
rail
The
a
total
is
network
period,
assessments
will
only interest payments. The
F. Eberstadt
&
imum
Co.
Briggs, Schaedle & Co., Inc
44 WALL
transit
district
STREET, NEW YORK 5
in
last
figure is the
highwater mark which will rep¬
resent repayment of capital costs.
During
the
preceding
10-year
meet
GOVERNMENT
SECURITIES
TELEPHONE:
TELETYPE:
BOwling Green 9-5600
N. Y. 1-2056
max¬
tax
rate
would
represent
7J/2%
of
the
average combined tax rate in the
five
counties of the District.
FLORIDA
Underwriters and Distributors
United States Government Securities
Metro Government to
in Dade
of Corporate Securities
Continue
County, Florida. The
troversial
"Metro"
is
ernment
be
to
con¬
Federal Agency Issues
plan
of gov¬
continued
in
Bankers Acceptances
Dade
County which encompasses
Miami and surrounding areas. The
Private Placements
metropolitan form of government
oblivion
the
at
Oct.
on
20.
A
record
number
out
decide
of
voters
turned
fate
the five-year old experi¬
Although passage of the
of
ment.
amendment
Financial Consultants
virtual
narrowly favorable margin
polls in an election held
by a
Mergers and Consolidations
from
saved
was
would
to
not
have
the
dis¬
solved Metro completely, it would
United
1
have
put such strong restraints
upon the power of the body that
figure-head
status
would
have
•
Manager and Distributor of
been
result.
If
the
have
caused
grave
Government
AND
Government Agency Securities
consequences
parts
of the country
plan is being consid¬
ered— notably in Cleveland, St.
Louis, Nashville and Memphis. In
fact, the question now is: Can
many
where
STATE, MUNICIPAL, HOUSING AUTHORITY
the
iron
Metro
lems
States
plan
had
been
turned
the
ramifications
could
down,
in
ultimate
the
Metro
out
the
REVENUE, RAILROAD, INDUSTRIAL,
PUBLIC UTILITY BONDS
prob¬
many
that have been plaguing the
EQUIPMENT TRUST CERTIFICATES
Metro
operation? No doubt, those
considering the plan will develop
a
F. Eberstadt
65
BROAPWAY
Telephone WHitehall 4-8787
page
San
subway and tunnels,
2-mile rail
&
Co.
NEW YORK 6, N.
Y.
Teletype N Y1-6I8
wait-and-see
attitude
before
jumping
in
with
both
feet.
Metro's problem has been that the
municipalities within the govern¬
ment have maintained much
trol
extent.
vote
Wm. E. Pollock & Co., inc.
NEW YORK
con¬
local matters nul¬
lifying the roll of Metro to some
over
many
However, it is hoped the
of
confidence
given
the
BEVERLY
HILLS
SAN
to
buy and sell property.
miles of aerial
operation.
j
transit system, establish transpor¬
tation policy and direct all trans¬
portation activities.
a
Francisco Bay area Rapid Transit
42
District have developed a sched¬
lines, 52 miles of
ule of future tax rates to finance
high-speed surface lines, a 14-mile
construction of the rapid transit
underwater transit tube connect¬
miles
petus
MARYLAND
including
surplus
indus¬
freeways, of rapid transit facilities
in the city centers, of bus express¬
control.
travelled
tolls. By
foregoing
include:
regional growth, en¬
couragement of development in
urban centers, reduced smog, new
and
along
heavily
corridors.
which will be
of
try, provision of shelter and trans¬
portation for civil defense.
Metro
construction of the
the
locations for business
Beatty, A. G. Edwards <£ Sons, St. Louis; William N. Edwards, William N. Edwards &
Co.,
Worth, Texas; Robert D. Anderson, Distributors Group Incorporated, New York; Robert O.
Shepard, Prescott & Co., Cleveland; Herbert R. Anderson, Distributors Group Incorporated, New York
radiating outward from the
trans-bay
tube
and
extending
not
premiums, automobile
operating costs, parking charges,
bridge tolls and traffic control.
Intangible
benefits
which
may
initial planning should be designed
to seek balanced development of
Floyd
Fort
Total cost will be
insurance
exceed
Edward D.
lines
Bay
estimated tangible economic
stimulus
Southern
Research
ation
area,
39
FRANCISCO
MIAMI
40
40.
John
The Commercial and Financial Chronicle
Roosevelt, Bache £
Co., New York;
Chuck
Mr. &
Mrs.
Rendigs,
Maurice
Bache
&
Co.,
Meyer, Jr.,
New York
Hirsch
&
Co.,
New
Continued from page 39
ficiently acquainted with regula¬
to
tory
tion for transportation
tion
as
ment
on
the vote of the authority,
which is needed to authorize such
ownership
delay
two-year
allow
and
the
operation.
planned
was
authority
The
time
to
In
and
financial
the central
more
City and
matters.
district of Balti¬
some
of the
lying communities the
ration
point
is
near
out¬
satu¬
reached
by
exclusive¬
ly by automobile.
Moreover, a
projected increase in the labor
Baltimore, Anne Arundel
Baltimore
Counties, will add
approximately
120,000 persons to
and
to
automobiles and highways in peak
those
ac¬
hours. Although new expressways
portation
who
ment
in
need
of
trans¬
Public
senti¬
means
to
work.
the
past,
however, has
being planned, it is impossible
opposed a subsidy
for mass
transit but approved expenditures
<mzzzzzmzzzzzzzzzzznzzzzzzzzzzzzznzzzznzzzzznz2zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzm
for highway construction.
quire personnel and become suf¬
are
is
St. Louis faces transit quandary.
More
than
spent
on
a
$400,000,000
expressways
is
as
being
part of
problem of adequate mass
transportation in the Baltimore
m
is
area
a
regional one and
will provide benefits
solution
respective
f$ate
and ^/Hanicdiai tyjwuh
ffloubintjf*
venae
Sdaf/iord^
d werAewde
am
^Oends
of
its
ir¬
political
internal
County but traffic growth
strips highways. Railways
increased
costs,
sit
is
fragmented.
In
recent
posals
would
three
the
St.
acute
area
do
doubtful
much
that
this
alleviate
to
a
the
for
Anne
will
this
year
until
found
proves
Louis
to
pro¬
solve
metropolitan
transportation problem. The
central feature of all
three plans
three
plans which
submitted
ownership,
call
for
the third
ap¬
continuation
ownership, There is
phasis, however, on
transit
of
private
common em¬
a
consolidated
system.
The first
of the three plans was prepared
Metropolitan
Transit
a
Committee,
group
come
Direct
to
and
the
County Supervisors. This
attitude
private wires to
Canadian
in the near
remedy can be
or
Exchanges
the
of
Arundel
The
Commission
authority
hensive
report
ob¬
only a metropolitan
can
supply a compre¬
Members
New York
approach and continuous
specialized handling of
transit problem.
the
The
advantages of a
politan transit authority
first
J. R. TIMMINS & CO.
that
serves
that
the
exclusive
Stock
Exchange
Toronto Stock Exchange
American Stock Exchange (Associate)
mass
metro¬
Montreal
Stock
Exchange
Canadian
Stock
Exchange
Investment Dealers' Association of Canada
include
concern
special agency would be
given to metropolitan transporta¬
tion.
(At present, public mass
transportation
in
Baltimore
is
a
NEW
61
YORK
TORONTO
Broadway
MONTREAL
372 Bay Street
Royal Bank Building
regulated by the Public Service
Commission.)
Specializing Exclusively in
Second,
diction
of
would
extend
the
juris¬
authority
the proposed
over
the
appro¬
priate
geographical area. Third,
authority could use its rev¬
enue-raising capacity to the ad¬
vantage
of
private
companies.
Fourth,
in the event that the
authority
acquire
and
operate
the
STATE
transit
mass
have
BONDS
rate
vate
BRAUN. BOSWORTH & CO.
•
CHICAGO
NEW YORK
•
•
The
general
CLEVELAND
include
bonds, raise
DETROIT
authoritISrevenue
OBLIGATIONS
pri¬
encourage
companies to improve
jersg*aunicipal
and!!?
serv¬
ices.
private
TOLEDO
w
new
companies, it would
return would
would
BONDS
UNDERWRITERS
its
INCORPORATED
MUNICIPAL
•
DISTRIBUTORS
disposal
revenues,
formerly paid in taxes or divi¬
dends, which could be used by
the authority to improve services.
Fifth, private companies could be
required, in the suggested pro¬
gram, to extend existing services.
Sixth, the use of prudent operat¬
ing ratio as a method of fixing
and
MUNICIPAL
at
ORIGINATORS
ness.
services
of
in
or
circumstances.
issue
assist
their
busi¬
authority
to
powers
to
and
revenues,
operators
The
empowered
of
grant
authority
require
routes
would
extension
in
Boland, Saffin,
Gordon & Sautter
Established
be
given
64
WALL
1920
STREET, NEW YORK 5, N. Y.
Bell
System
ap¬
pointed by the Mayor of St. Louis
Brokers and Institutional Investors
the
in
1959 for the Citizens
Our Services Are Available to
County Commis¬
sioners towards the proposed pro¬
grams.
This could come about in
the county elections in 1962.
Since 1923
made
problems now plaguing the city
and surrounding areas.
But it is
of
and
the
been
all-bus
months
have been
of
Two
proposed
future
Phelps, Fenn & Co.
portation facilities.
public
popula¬
To date there has
integration of trans¬
little
face
tion surges upward.
metropolitan
transportation authority for the
Baltimore area, is looked upon for
the most part with favor by all.
It goes without question that the
initiation
of the proposed plan,
pass
been
out¬
Public tran¬
Area
coordinated metropolitan area
have
competition
declining patronage.
boundaries.
The
a
Co.,
transit system.
federal aid program in St. Louis
The
ea/eM
Thursday, December 28, 1961
MISSOURI
provide sufficient accommoda¬
force of
.
.
Charles L. Bergmann, R. W. Pressprich & Co., New York; Roald Morton, Blue List Publishing
New York; Mr. & Mrs. Walter W. Craigie, F. W. Craigie & Co., Richmond, Va.
York;
authorhy
ownership and opera¬
well as a special require¬
.
Teletype—NY
WHITEHALL 3-1570
1-535
Volume
Mr.
&
Number
6120
.
The Commercial and Financial
.
advocated
number
a
including
network
of
an
of
extensive
expressways,
limita¬
parking, improved traffic
controls
and
highways,
rapid
on
outer sections of expressways.
buses
same
power
loop with outlying sec¬
tions of the city and county. Of
miles
of
rapid transit service,
almost half would be
bus
roadways,
the
on
exclusive
balance
The
both
exclusive toadre¬
area-wide auth¬
with taxing
powers
and
to deal with traffic, fares
port proposes
ority
tribution
supply
rapid transit Service. The
facilities. A bus rapid
transit
system
is
the
central
feature of the plan. Radial routes
would connect a bus roadway dis¬
parking
Wduld
service and
local
way
transit bus terminals and increased
86
41
Chronicle
James
Davant, Paine, Webber, Jackson & Curtis, Minneapolis; Robert A. W. Brauns,
Co., Incorporated, New York; W. R. Caldwell, First Boston Corporation, New York
changes
tions
.
Mrs. James W.
McDonnell &
plan
194
an
and service. Total cost of the
plan,
including improvements in high¬
ways,
traffic control, parking and
other
projects, is $340,000,000. A
$20-a-year levy on all automobiles
within the area is suggested as a
of financing the plan.
Mayor Raymond Tucker of St.
means
on
Reilly, Goodbody & Co., New York; Mr. & Mrs. Jack Rennau, Carl M. Loeb, Rhoades
New York;
Lawrence Illoway, Penington, Colket & Co., Philadelphia
Louis has proposed a second
the creation of
Commigsiort,
with
plan,
St. Louis Transit
a
appointed
by
power to acquire
transit facilities in the area.
mayor,
piari
third
The
the
all
offered by
Service Com¬
private enterprise. Under
the
company
would
integrate all transit service in the
St. Louis
Metropolitan Area. It
a
pany,
this
plan
now
earns
Its plan provides that it
acquire working control of
service.
will
cations.
correct this
new
leaders
the
14 other transit companies in
the
area.
would
This
make
pos¬
by
move
followed
municipal
nine
a
month
study by a special committee of
Mayors and other civic figures in
which they agree upon the idea
of a limited management charter.
PENNSYLVANIA
approximately 80% of
dollar volume of transit
the total
from
A
Was
the St. Louis Public
ty
Charter which would have
metropolitanized most of the
services with metropolitan impli¬
Philadelphia
tion
In
problems.
other
common
large metropolitan
the Philadelphia area
an acute and growing trans¬
portation problem. Various local¬
ized efforts are being made to
situation, such
organization
of
with
centers,
the
as
the
Passenger
Service Improvement
Corpora¬
cooperative
City of
Philadelphia, the Pennsylvania
and Reading
railroads, and the
railroad
brotherhoods, and the
tion, involving
line
a
the
high-speed transit
connecting the City of Phila¬
delphia
but
a
between
agreement
promotion of
transporta¬
area
Co.,
&
with
the
Camden
area,
by far the most comprehenContinued
is suffering
on
page
uni¬
fied planning and operations, and
centralized maintenance of equip¬
coordinated schedules,
sible
The
ment.
traffic
new
would be relieved
to
&
Co.,
Incorporated
cover
50
BROAD
NEW
YORK
Telephone: WHitehall 3-6750
STREET
4, N. Y.
Teletype: NY 1-5126
Specialists in
local taxes. New
parking regulations
would be introduced. Regulatory
jurisdiction would be given a
local St. Louis metropolitan area
agency, rather than a state com¬
mission. Operating contracts would
tion
pay
and
traffic
Harold C. Shore
system
obliga¬
of the
Foreign Securities
the service and rates to be
provided, with a floor and ceiling
on
earnings. The company would
replace double fares with trans¬
fers, add 37 rush hour and shopper
express lines to outlying districts,
supplement local routes and ex¬
tend existing routes.
The advantages and disadvan¬
tages of a
publicly subsidized,
profit-making private system,
compared to a publicly owned
system that pays neither taxes nor
dividends, must be weighed in the
balance. It is generally agreed,
however, that delav in a worsen¬
ing situation is the most costly
Foreign Investments
idui/io/dand
tfnc.
Associate Members American Stock Exchange
30 Broad
Street, New York 4, N. Y.
Teletype
Telephone
of all.
course
SECURITIES
INVESTMENT
NY 1-515
WHitehall 3-9200
CAROLINA
NORTH
Consolidation
and
City
the
of
of Durham meets defeat.
than a four to one vote
County
A better
citizens of the City
of Durham defeated
proposal
of
the
Durham
Charter Committee to consolidate
cast
and
JOHN J. MEYERS & CO
by the
County
the
the
County and City.
rural
Both
Brokers and Dealers
tricts
well
as
professional
as
groups, industry, and members of
all
ethnic groups voted in the
was
an
a
fear of increased taxes and
fooled!"
those op¬
be
''Don't
effective
waged by
posed to the Charter.
campaign
AND RAILROAD SECURITIES
OHIO
Cleveland
voters
establishment
mission.
of
a
to
decide
charter
on
Street, New York 4, New York
WHitehall 3-2850—teletype, New York 1-809
missioners
"Shall
a
to vote
follows
by
on
Charter
only
15
72
WALL
rejection of
a
YORK 5,
Teletype:
N. Y.
NY 1-897
the
Comr
This
ac¬
RIO
DE
JANEIRO
LIMA
•
•
SAO
PAULO
PANAMA
•
months
•
the
NEW
STREET
WHitehall 4-2400
Telephone:
the
that
requested
allowed
mission be established?"
tion
Established 1888
A delegation from Cuya¬
voters be
question
Frederic H. Hatch & Co.. Inc.
com¬
hoga County Mayor's and City
Manager's Association appearing
before the Board of County Com¬
30 Broad
Securities and Investments
Among the telling factors
defeat.
INDUSTRIAL, PUBLIC UTILITY
LATIN AMERICAN
and city dis¬
areas
proposed Coun¬
S.
i
•
AIRES
BUENOS
CARACAS
•
•
NASSAU
SANTIAGO
42
42
The Commercial and Financial Chronicle
Walter
D, Kingston, Jr., E. F. Hutton & Company,
it
John
Continued from page 41
been
under
1959,
by
since January,
organization under
Penn-Jersey Trans¬
portation Study. The group mak¬
ing up this organization consists
of 12 agencies,
including the U. S.
Bureau of Public Roads, the State
highway departments of both
Pennsylvania and New Jersey,
of
counties making up
Philadelphia-Camden-Trenton
metropolitan
area.
The announced
objective of this study is "to plan
a coordinated
highway and public
transport system to promote and
desired pattern of regional
serve a
development
Philadelphia
in the nine-county
Camden - Trenton
metropolitan
region."
Intensive
other
and
exploratory
work have been underway in this
surveys
region
and
exhaustive studies
on
transportation problems and their
New
solutions have been conducted in
other metropolitan areas through¬
out the country.
This work is being directed by
large staff, including experts in
way
an
name
and the nine
the
Bradford Simpson, Hallgarten & Co., New Ycrk; Calvin Cross,
Hallgarten & Co., New York; Fred Peyser, Hallgarten & Co.,
Orleans;
Latshaw, E. F. Hutton & Company, Kansas
City, Mo.
sive effort to resolve the
problem
consists
of
a
study which has
the
New
Stephens, Texas Fund Management Company, Houston;
a
all of the specialized fields which
can contribute to the solutions of
transportation
associated
problems
issues
and
the
of
regional de¬
velopment. The staff includes not
only contractors and traffic plan¬
and
ners
engineers;
but
also
economists, sociologists, political
scientists, urban planners, geog¬
raphers, and experts
data compilation and
Full-time
some
the
staff
600
effort
far
so
to field
work
of
While
has
surveys
number
most
been
and
exploratory
an
modern
processing.
members
people.
voted
in
of
de¬
other
nature,
methods
of
putting
these
plans
TENNESSEE
Legal
steps
Tennessee
tion
has
state
the
taken
to
annexation.
been
and
prevent
Court
initiated
by
annexation
ac¬
both
Federal forums to
proposed
of
halt
a
41
mile area with a population of
48,600 by the City of Knoxville.
Petitions calling for a referen¬
dum
the
on
initiation
ordinance
had been circulated
widely. There
have been reports of irregularity
regarding the petitions though the
Knox
County Election Commis¬
sion
of
has
certified
registered
the
signatures
voters.
However,
enough suspicion
generated to
was
force the
City Council to initiate
investigation.
The
Election
recommendations should be forth¬
an
coming
Commission thereupon petitioned
the circuit court for information
of
soon
us
to what character
transportation
facilities, both
rail and highway, will best serve
the region's needs and as to the
to
stop the council from seeking
petitions and succeeded in
securing a show-cause order. Upon
hearing the arguments the referee
ruled that a petition for a referen¬
the
dum
ordinance
on an
Connecticut
in
met
discuss
their
future.
Their
the
INCORPORATED
20
to decide
power
Teletype NY 1-1334
vidual
HAnover 2-6900
suits
—-
the
Distributors
state
nexation
sidered
STATE
AND
MUNICIPAL BONDS
24
the
discussion
of
the
area
the
to
the
date.
based
was
on
jobs
recently
released
New
York
Metropolitan
Region
Study,
a
three-year project conducted by
Harvard
University's
It
is
50%
tion
25
anticipated there will be
growth
ring
a
increase in jobs and popula¬
in the region over the next
with the fastest rate of
years,
occurring
—
in
the
Monmouth,
outer
Middlesex,
Somerset, and Morris Counties in
Jersey; Dutchess, Putnam,
Orange, Rocklajnd, and Suffolk
New
Counties in New York; and Fair¬
field
County in Connecticut. The
UNDERWRITERS
of urbanized land will double
4,000
miles by that
continue to
square
The region will
relatively
a
high
wage
filled
to
a
greater
INDUSTRIAL
areas.
the
An
The businessmen concurred that
obsolescence
of
transportation
facilities and waste of capital in¬
vestment
found
and
prime
be
to
land
were
fundamental
the
weakness
in the present regional
plant. Transportation to the cen¬
tral
business
quate,
core
districts
traffic
cost
now
billion
the
to
is
congestion
inade¬
in
$2
region's businesses.
They further agreed that the total
transportation system of the re¬
gion must be dealt with as a whole
and
DISTRIBUTORS
AND
PUBLIC
UTILITY
SECURITIES
Sunreme
constitutionality of
law, which permits an¬
by ordinance, is con¬
probable.
Litigation on
RAND
&
during
annexation
ONE
cannot
WALL STREET
CO.
NEW
YORK
5.
N.
Y.
be effected.
Telephone
In *the
courts
in
Nashville
The
JAPANESE
of
industrial
found
annexation
turned
of
that
the
debatable
a
and
a
The DAIWA Securities
Co., Ltd.
since
not
be
nexations
NEW YORK
HOME OFFICE:
8-2
CH0ME 0TEMAGHI
6, N. Y.
TELEPHONE:
BEEKMAN 3-3622
CABLE ADDRESS: FUBILLS.N.Y.
CHIYODA-KU, TOKYO, JAPAN
CABLE ADDRESS:
FUBILL, TOKYO
case.
Years
on
the
as transfer agent
in
favor-;
representation
Appellants
New York, N. Y. and
are
at
large and annexed
automatically
vote
for
We
have
them
are
whereas
ville councilmen
are
and
would
right
in
other
advantages to
underwriters, distributors, corporations
elected
areas
the
Jersey City, N. J.
afford economies and
the grounds that in
councilmen
of Efficient and
Service
over¬
prior Supreme
a Knox¬
of
60
Economical
to distinguish between
Nashville and Knoxville an¬
Knoxville
149 BROADWAY
Than
expected
the
NEW YORK OFFICE:
More
the
upholding
issue
in the instant
com¬
annexation
ville annexation determined
the
1-838
property.
question,
could
that
Court decision
ably
NY
city of
miles of
seven
and
courts
was
Teletype
area,
local
ruling have up¬
brief
reasonableness
SECURITIES
4-3432
Knoxville
a
held the annexation to the
mercial
Whitehall
their stockholders.
to
Nash¬
Write for
elected from
districts and the annexation ordi¬
should therefore make pro¬
vision
for
representation.
and
■
'
y •
our
State
-
free booklet setting forth the Current Federal
Stock
Original Issue
and
Transfer Tax Rates.
.
_
nance
TRI STATE REGION
New
York-ConnecticutNew
Jersey
mi
Crystal ball view of metro needs
in 1985 discussed
Businessmen,
from the
New
by businessmen.
forty-one
strong,
Jersey, New York,
'
Registrar and Transfer Company
50 CHURCH
v
|
STREET
7
tT
V
New York 7y N#1 Y«
BEekman 3-2170
15 EXCHANGE PLACE
Established
1899
the
estimated
an
the
period
by
lesser extent by in-migration.
a
brought by property
to
area
extent
STATE. MUNICIPAL. PUBLIC REVENUE
this question promises to continue
for
two
years
or
more
which
and 9.5 million
region in 1985. The
natural population increase and to
considered vital.
was
the
cover
be
Graduate
The improvement of mass trans¬
portation systems and the
de¬
velopment of broad land use plans
region
in
providing a diversity of employ¬
ment opportunities, which will be
School of Public Administration.
in the
million people
for
over
J.
study estimates that there will be
the validity of
on
appeal
on
region
to
York
properly
was
in the annexed
ultimate
Court
Underwriters
years
petitions.
owners
Thursday, December 28, 1961
needs
area
Further litigation pertaining to
the annexation consists of indi¬
Exchange Place, New York 5, N. Y.
New
development
25
next
submitted to the City Council and
that
the
City Council had the
W. H. Morton & Co.
metropolitan
Harrison,
region's
.
.
Tyrus R. Davis, The Bankers Bond Co., Louisville; Matthew
Hickey, III, Hickey & Co., Chicago; Mrs. Elincre Sedley,
The Bankers Bond Co.,
Louisville, Ky.
York
effect.
into
.
Jersey City 2, N. J.
HEnderson 2-2211
Volume 194
Number 6120
.
.
The Commercial and Financial Chronicle
.
43
t*
Walter N. Ma this, Dittmar &
Sweney Cartwright &
Edward
to
assure
Company, San Antonio; Lowry Sweney,
Columbus, Ohio; Edward D. Jones,
& Co., St. Louis
Co.,
D.
efficient communication
the older central business
among
districts, and the
clusters
and
newer
residential
areas
was
and
programs
suggested
that
New
Connecticut develop
1400
comparable
organizations such
to
New
low-rent housing units.
was
further agreed upon that
States, counties,
and
municipali¬
cooperation,
local
as
the
VIRGINIA
governmental
The proposed merger of the
for
high tax
producing industries and residents.
exercise
states
and
more
counties
should
responsibility
in
Richmond
talks
about
on
merger.
Dec. 12,1961.
City
Richmond, Virginia and its
neighboring Henrico County is
approaching completion. The deci¬
sion will be made by the voters
on Dec. 12, 1961. If the voters and
the legislature approve the plan,
of
the
merger
tive
Jan.
of
will
become
suit
to
annex
miles of Fairfax is
still pending in the courts and
Alexandria is expected to seek a
larger area later this year.
Fairfax County,
perienced
of
more
been
a
which has ex¬
population increase
than 250% since 1950, has
considering
measures
vent fragmentation by
to pre¬
tions
and
annexations
three years.
Public
for
over
In January, 1958, the
Administration
Service
recommended
a
"Metropolitan
County"
form
of
government,
pointing out that if existent state
laws
remained
expansion
of
continued,
the
unchanged
cities
and
county
and
towns
would
bonded
indebtedness
nullify county planning and zon¬
ing, and complicate extension of
urban-type services.
The
urban
drafted
sion
by the
on
county
plan,
as
Fairfax Commis¬
Urban
incorpora¬
County
Continued
on
Governpage
of
County, which is out¬
standing as of the official merger
date, would be assumed by the
new
incorporated city. Henrico
County
obligations
are
rated
Underwriters
would
only
Richmond
make
cities
three
in
Investment Securities
of
one
Distributors
and
OF
Aa
and the present city of Richmond
retains an Aaa rating. The merger
the United
city gov¬
States with county and
combined.
ernments
Denver
and
San Francisco enjoy governments
of this type.
M. A. SCHAPIRO &
1
CO., INC.
An important factor in the pro¬
posed corporation
entails the re¬
equalization
County tax rates
would have to be gradually raised
if such a merger was to be ef¬
vision
CHASE MANHATTAN
NEW YORK
PLAZA
5, N. Y.
Telephone:
Teletype:
HA 5-6600
N. Y. 1-2788
the
of
tax
Henrico
rate.
fected.
D. E.Jiederman &
80 PINE STREET
Co.,
inc.
NEW YORK 5, N.
Y.
To
provide for a representative
government body, the proposed
city area would be divided into
five
boroughs,
one
being
the
present city and other four be¬
ing the four magisterial districts
of Henrico County.
The present
city borough would elect four
Telephone: HA 5-7550
council members and each of the
county boroughs would elect one
UNDERWRITERS
—
DEALERS
—
DISTRIBUTORS
Three council members
member.
Japanese Securities
would be elected from the incor¬
porated city at-large.
County
State and General Market
-
Town
Established 1914
Geo. B. Gibbons & Company
INCORPORATED
One
Chase
Manhattan
Plaza, New York 5, N.Y.
denied.
A
petition by the Fairfax County,
Virginia supervisors seeking a
to
referendum
Municipal Bonds
merger
consolidate
the
town of Clifton and Fairfax Coun¬
ty has been denied by the Circuit
Court.
If it had been approved,
a formerly sparse rural area would
have become the second largest
municipality in the nation. Fair¬
fax
County, Virginia,
with an
area
of 400 square miles and a
YAMAICHI SECURITIES COMPANY
of NEW YORK, INC.
Brokers and Investment Bankers
population of 275,000 had previ¬
ously signed a merger agreement
with the town of Clifton, with a
population of 230, on the author¬
ity
of
a
law
which
and
town
single
unused state
authorizes
a
county
to
consolidate
into
1
Affiliate of
heretofore
YAMAICHI SECURITIES C0.y LTD.
TOKYO,
a
JAPAN
city.
The
Teletype NY 1-199
Telephone HAnover 2-4474
merger
plan represented
attempt to prevent the gradual
eating away at the county by
an
selective
annexation
suits
and
111
be
cut in two in ten years
by a series
of municipal islands which would
city
a
Henrico
STOCKS
Church
square
City, Okla.
350,000 persons.
The
BANK
Oklahoma
effec¬
1963 creating
1,
Falls
4.5
sion to be reached
units
John W. Bunn, Stifel, Nicolaus & Company Incorporated, St. Louis;
Mr. & Mrs. Tom G. Hilborne, Liberty National Bank,
incorporations. Under Virginia's
unique pattern of city-county sep¬
aration, wherein a city of over
5,000 persons is dejure indepen¬
dent from the county which may
surround it, city annexations re¬
move
territory, population, and
taxable values from the county.
A
Metro¬
eliminate competition among local
hazard
to
region's
through
through
services, and
stimulation of
cooperative local
planning and action. Finally the
group suggested that the public
must be educated to the concept
of the region and its patterns of
change and growth.
Richmond—Henrico County: Deci¬
The
development and
the
development
Regional Council. Effec¬
tive regional cooperation requires
adjustment of the tax structure to
ties must act quickly to halt hap¬
land
among
governments
regional
technical advice and
politan
low-interest, long-term loans for
It
that
recognized by the group
public policies for guiding
was
region's development will re¬
quire
careful
study and
close
York's limited tax abatement and
new
open space for the antici¬
pated population boom.
It
Johnson, The Milwaukee Company, Milwaukee, Wis.;
Friend, Folger, Nolan, Fleming-W. B. Hfibbs & Co.,
Washington, D. C.
S.
the
throughout the region.
It
T.
Arthur
reserve
industrial
which will continue to spring up
Jersey
Joseph
Jones
BROADWAY, NEW YORK 6
COrtlandt 7-5900
44
44
The Commercial and Financial Chronicle
Continued from page 43
of
ment, was enacted by the State
Legislature in 1960. It extends to
cooperation with the utilities
missions
counties of
and
sons
than 90,000 per¬
organizational option
more
new
a
which allows sub-units
of
the
county
government to function as service
districts and pre-empts all future
of
Congress
the
Commission
Maryland,
the District
1960,
to
Tri-State
states
and
the
In
the region are
ulation of four separate commis¬
corporated cities.
sions, three from the District of
proposal
Columbia,
survived, the county would have
ginia
achieved city status without wait¬
ing for legislative charter ap¬
proval.
The pertinent enabling
statute provides that such consol¬
idation may take place provided
that the consolidated city adopts
the draft city charter which is
written
the
into
given
prior
statute
approval.
and
had
second-class city status
its territorial
to
is
newly
vestment Bankers Association for
A
for
Transit Regulation
signed
the
in
December
Governors of
ginia
and
the
of
of
The
of the
Transit
Commission,
regulate
the
which
existing,
owned transit
m
the entire metro¬
in
San
continue to be
Francisco, Calif.
pleased
Campbell
this
to
The
area.
the
signing
of
for March of
The
compact,
years' work.
in
1959
It
the
stock
the
figures justi¬
in insurance
year
Published
"Mind
Over
best
year
The
stock
history,
Matter"
in
more
over
concretely, state of mind
term operating results.
Philadelphia National Bank
Value,
Philadelphia, Pa.
mately in the mind—a kind of fi¬
nancial
George B. Wendt
Cullom Davis,
New
in¬
toward
well
known
Chairman
York, N. Y.
Amos
The First Boston
influenced by:
Disillusionment toward
growth stocks in¬
(4)
New
Corp.
York, N. Y.
Bowen
Blair
William Blair & Co.
electronics,
Chicago, 111.
C.
J.
Bradford
J. C.
Bradford & Co.
Bank
believe,
resides
ulti¬
equivalent of the philos¬
Expectation
life
sales
Robert R. Gilbert, Jr.
Sanders
life
earnings, aided by substantial
leverage,
will
skyrocket
with
continued high interest rates and
improved mortality, particularly
heart
and
William F.
John
New
of
price-times-earnings ratios
stocks, representing
insurance
the
state
toward
San
mind
of
investors
in
rose
which
C.
during 1961. Insurance
While
near-term
opher Descartes' dictum "I think,
formance
Chicago, 111.
therefore I am."
to
market
are
Graham
per¬
This"
Jones
Cooley & Co.
Hartford, Conn.
Significant Developments in
Casualty Insur¬
The Fire and
ance
A
Field in 1961
the
logical procedure in tracing
significant developments in
the
fire
and
casualty
insurance
field this year is to examine them
from the following standpoints:
now seems more
subject
general market conditions, the
Allyn & Co.
Chicago, 111.
shares,
the
they are held,
securities, cheap a year ago,
now reasonably
priced.
C. Gorey Co.
Francisco, Calif.
Henrickson
F.
A.
insurance
esteem
hence
of
& Co.
York, N. Y.
Walter
Stocks Reasonably Priced
The
Gliss, Jr.
C. Legg
Walter C. Gorey
H.
cancer;
(5) Strong technical position of
insurance stocks at the beginning
of the year, due to five years of
consolidating market movement.
& Co.
Dallas, Tex.
enormously helped by the
First National Bank of Chicago
In 1961 the state
that
-
Philadelphia, Pa.
coming family explosion and that
a
near
we
was
SECURITIES
Shelby Cullom Davis & Co.
industrial
will be
insurance
rather
broad
statement,
represented the
tri¬
umph of mind over matter, or
Pittsburgh, Pa.
was nego¬
best
history.
Robert V. Wehrheim
by representatives
that
operat¬
ing figures in fact showed little
if any improvement.
Harry J. Steele
set
compact is the product of
several
tiated
the
are
not
was
fied
C. Payne
Baltimore, Md.
1961.
Shelby Cullom Davis
at
proud to present our
third annual report.
1961 was a "year to remember."
Alex Brown & Sons
Commission is
begin operations 90 days after
we
recogni¬
tion and
It
Shelby
and casualty in rating and mar¬
keting which will improve the
long-term outlook;
surance
So
(1)
investors
stocks
surance
some
of
Factors
influencing underwrit¬
ing profit
margins.
This includes
MUNICIPAL BONDS
helpful booklet
SPECIALIZING IN ODD LOTS
outlines 7 key
corporate objectives
why it i$ testc
to a wmpaay's
atteptafwe and growth
in today's economy
for
LEBEINTHAL& CO.,INC.
1 CHASE MANHATTAN
your company
Specializing in
bonds
IN-ODD-LOTS
2
pave
3
build public confidence
4
broaden
5
win investors' favor for your securities
6
"sell" your company as a good place to work
7
gain recognition from financial analysts
way
Municipal*
HA 5-6116
j' LE DE NTHAL V CO.tj
sell your
or
•
ODD LOT MUNICIPAL BONDS
1
products
PLAZA
Oldest House in America
and shows how to—
the
services
for favorable
in
new
capital financing
your
management
'4;
Now in its
second
printing
ownership of
your
company's stock
in which
we
have been
small, and what
we
more
about
helpful to
our
many
facilities, the
just call
or
ways
HEAD OFFICE:
TOKYO
companies, large and
would suggest for meeting your
needs. For your free copy,
JAPANESE SECURITIES
The Nikko Securities Co., Ltd
"The Total Corporate Impact" should enable you to decide
whether you wish to know
1
own
specific
write Quentin Smith.
CHASE MANHATTAN
Telephone:
PLAZA, NEW YORK 5, N. Y.
DIgby 4-7710
YUTAKA
AF-GL
Teletype:
NY
1-2759
ISHIZUKA, Manager
NEW YORK
ALBERT FRANK-GUENTHER
LAW, INC.
PHILADELPHIA
Affiliate:
BOSTON
Advertising
131 Cedar
•
Public Relations
Street, New York 6, N. Y.
•
COrtlandt 7-5060
of
COMMITTEE
(3) Belief that fundamental
changes are taking place in fire
a
stocks.
H. J. Steele & Co.
politan
to
mention of
Dallas, Tex.
will
the
never
J. Creighton Riepe
privately
m
u
mind
for
instead
sired;
Nashville, Tenn.
(2) Consideration of insurance
Robert H. Chaut
companies as financial—not just
Kidder, Peabody & Co.
insurance
institutions, benefited
New York, N. Y.
by higher interest rates, with cons t a n 11 y
expanding investment F. W. Elliott Farr
Girard Trust Corn Exchange
earnings;
fertilizers
and
Ball, Burge & Kraus
Cleveland, Ohio
the
Washington Area
the
market in
ing
INSURANCE
whose operating and market per¬
formance
left plenty to
be de¬
round¬
of
ups
of
cluding
read
can
min
Dallas Union Securities Co., Inc.
compact provides for
creation
sun.
zinc, includ¬
Harold K. Hutchinson
the District of Columbia.
in the
In¬
cals from alu-
K. Browne
Jack
place
the
leading finan¬
cial
periodi¬
Southwick, Campbell & Co.
Seattle, Wash.
Maryland, Vir¬
Commissioners
you
Bank of America
Colin A.
by
1960
temporary
know,
group
Denver, Colo.
Area
was
the metropolitan area.
J. A. Hogle & Co.
assure
Compact,
this
to
You
Frederick F. Barker
precedent.
Metropolitan
the regulation of tran¬
Phelps, Fenn & Co.
York, N. Y.
precedent-setting document, the
Washington
will
New
Alan
sets
Commission
Orlando S. Brewer, Chairman
integrity within the
compact
created
Securities
stock
another!
many
William W.
Again
state Commerce Commission. The
WASHINGTON, D. C.
C.
Inter¬
SUBCOMMITTEE
ON
METRO? POLITAN AREA PROBLEMS
proposed larger city.
D.
Vir¬
and
fourth, the
Respectfully submitted,
A
petitioned
Maryland,
the
Insurance
Committee is grateful
sit in
City
the
County
Board
of
Supervisors.
Initial public reaction to the move
was favorable, although the town
Fairfax
subject to the reg¬
the
and
centralize
Council would have replaced
of
insurance
a
and
reach
Respectfully submitted,
Shelby Cullom Davis, Senior Partner of Shelby
Cullom Davis & Co., New York
City, presented to
the Convention the Report
of the Insurance Securi¬
ties Committee, of which he was Chairman.
The
Report follows:
At present, transit operations in
incorporations within the county
territory. It does not, however,
current merger
Securities Committee
of
fair
warmer.
an
said
as we
ago,
continues
You can still
year
Columbia entering the compact.
limit annexations by formerly in¬
If the
longer term outlook,
consent
District
Thursday, December 26, 1961
Report of IBA Insurance
Virginia
its
.
.
in
com¬
of Columbia.
gave
.
Nikko
Kasai
Securities
Co.
CHICAGO
SAN FRANCISCO
LOS ANGELES
220
Montgomery St., San Francisco
Telephone YUkon 1-3120
4
235 E. 2nd St., Los Angeles
MAdison 6-7163
Volume
194
Number 6120
.
.
The Commercial and Financial Chronicle
.
45
the
made in
progress
problems
of
tion
solving the
liability
automobile
of
have
insurance, gains made in increas¬ tion
ing operating efficiency by reduc¬ tions
ing
the
ratio
premiums
of
of
written
weather
and
the
conditions
effect
under¬
on
writing results.
Factors
sults.
affecting investment
be
in
gains
vestment
be
or
considered
combinations
and
policy¬
capital
action
might
on
or
casualty
the
field
nies. This would include
a
Mos., 1961
Loss Ratio
Expense Ratio
-
^.
Combined
of
*101.6%
companies.
of
insurance
tack
substantial
from
in
have made
the
on
in
all-out
an
the
chief
means
losses
gradually converted
into profits. Closer scrutiny of the
underwriting
business
received
from
agents
in certain
metro¬
politan areas also produced better
underwriting results through the
of weeding out less desir¬
able business.
process
either
of
fire
and
important
more
these
factors
has
than
the
and
aggre¬
expense
group of 40 representa¬
and
casualty stock in¬
companies for the past
one-half years indicates
of
electronic
processing equipment and through
better
organization
represented
of
thus
of
1960
and
1961
neutralized
out
ment. Net investment income
by
more than
appreciation
have
that
in
which
business
a
Company
39.1
39.9
40.9
41.2
heretofore
1961
cially
in
coverage
seemed
the
to
most
years
be
in
extended
1960
as
for
one
of
profitable underwriting
in
decade,
a
hurricane
half
points to
and
expense
the
one
and
combined
for
ratio
1960
one-
loss
and
of per¬
probability.
Losses
year
assuming that rates
Broadway, New York 6, N.
Y.
is
indispensable factor
an
requires that in¬
companies charge rates
fair and reasonable, and
economy,
surance
are
which
should
com¬
income
-i'V"
;••.
over
period of
a
Central National
Member National Association
years
Corporation
of Securities
Dealers, Inc.
100 Park Avenue, New York
17, N. Y.
to
Telephone: LExington 2-7300
margin for profit and contingen¬
a
Fire
cies.
and
can
creasingly selective
they assume.
as
to the risks
However, if the industry's
loss ratio
age
runs
Blair
between
Co.
INCORPORATED
aver¬
60%
Business continuous since 1890
and
65%, as would seem to be a
fair
assumption
under
current
conditions,
the
management
target
of
most
for
fire
the
Underwriters and Distributors of
and
MUNICIPAL AND CORPORATE SECURITIES
casualty insurance companies is to
bring the expense ratio (ratio of
expenses
to premiums written)
down! to
of
or
below 35%. This is the
number
a
of
Members New York Stock
practice of many analysts of in¬
surance
company
securities
to
judge managements of the various
companies
extent
to
a
of
large
the
degree
on
they
have made in the past three or
four years in reducing their ex¬
pense ratios.
Hettleman & Co.
and Other
companies,
and
several of these companies have
made notable progress in recent
years toward achieving that goal
figure. Thus, it has become the
the
progress
20 Broad
Street, New York 5, N. Y.
Telephone DIgby 4-4000
Albany
Atlanta
Columbus
Springfield
Boston
Eau Claire
Philadelphia
Tyrone
^Teletype NY 1-1109
Aurora
Detroit
New Haven
Exchange
Principal Security Exchanges
Pittsburgh
Washington
Buffalo
Flint
Rochester
Williamsport
Chicago
Marsbfield
Scranton
Wilmington
Equity Portfolio Gains
With respect
NEW YORK 5, N. Y.
Telephone: WHitehall 3*5770
to investment re¬
sults, the 1961 semi-annual aggre¬
gate figures compiled by Alfred
M.
fire
Best
Company
for
120
stock
and
panies
casualty insurance com¬
showed marked improve¬
PRIVATE WIRES TO
Glore, Forgan & Co.
Chicago
Gunn, Carey & Roulston, Inc.
Cleveland
Schneider, Bernet & Hickman, Inc.
Dallas
Bosworth, Sullivan & Company, Inc.
Denver
G.
A.SaxtonsCo., Inc.
Teletype NY 1-1605-1606-1
Underwood, Neuhaus & Co.
Houston
,
Crowell, Weedon & Co.
Los Angeles
Hess, Grant & Remington, Inc.
52 Wall St., New York 5, N. Y.
WHitehall 4-4970
Philadelphia
Reinholdt & Gardner
St. Louis
Stewart, Eubanks, Meyerson
San Francisco
& Co.
■.■
Bank and Insurance Stocks
expressed goal of the mangements
ONE WALL STREET
v*:
losses and expenses and leave
companies
during April
and
May, threw
underwriting results back into the
-■!*',
Industrial Stocks and Bonds
sufficient
assure
casualty insurance
attempt to refine
their underwriting business and
minimize losses by becoming in¬
and casualty insurance
panies for that year.
v.-
should
our
that
Utility, Railroad
and
underwriting opera¬
be profitable in the
long run. This is so because in¬
surance law, recognizing that in¬
tions
fire
SPECIAL SITUATIONS
Exchange (Assoc.)
Tel. BO 9-7030
to year but,
properly
pay
a
an
American Stock
71
are
major portion of the
underwriting profits of the stock
wiped out
Quoted
New York Stock Exchange
::
constructed,
surance
least
—
Members
;
Public
business
a
will vary from
in
seacoast, increasing insurance
losses by close to $100 million.
of
centages
ern
added at
Sold
ESTABLISHED 1910
Profitability
Insurance is
Donna struck Florida and the east¬
This
COMPANY, INC.
UNDERWRITERS, DEALERS and DISTRIBUTORS
in
sharp in¬
losses, espe¬
headed
—
Trading Markets in
Public Utility, Natural Gas and Industrial Securities
RIPP &
CO., INC.
AX-IXEMPT BONDS
ad-
page
Hay, Fales & Co.
troublesome line.
Furthermore, the expense ratios
of
many
companies have been
brought
down
to
much
more
satisfactory levels during the past
two
years, reflecting
the com¬
mendable gains in efficiency of
operations
which
have
been
1960
in
property
the fire and
lines.
Just
assets
on
Expense Ratios Key to
breaks
both
resulted
in
creases
bad
conditions
Bought
in
62.9%
company
1960,
Continued
Dividends since 1876
have
104.1%
31,
loss
Consecutive
liability insurance
a
profit for
60.2%
101.1%
Both
Dec.
Common Stock
produced
Insurance
1960.
premiums
...
„
^ as a resu^ of operations
'
.
since
in
SANBORN MAP
majority of the stock fire and
casualty insurance companies have
been making in solving their basic
operating problems. For example,
58.5%
98.4%
of
,
than
more
60.8%
99.9%
half
to
unearned
higher in the first half of
m10c1
compared
depreciation
both
1960, and several other companies
recently reported profitable
underwriting
results
from
this
1957
market
were
property
1959
1958
portfolios
first
recorded
was
and
reserves
rela¬
a
appear
progress
the
rose
7%, and substantial
at
1960
personnel, red. Before fire and
casualty com¬
important
panies could achieve much by way
avenue
for improvement. Reduc¬
of recovery from
the effect of
tions in commission rates paid on these
storms
on
underwriting
such
mass
lines
as
automobile profit margins, hurricane Carla on
has
would
Travelers
been
data
It
figures:
companies'
utilization
caused
tively small amount
damage.
the automobile
Again in the first half of 1961,
campaign to in¬ the
unseasonably cold weather of
crease efficiency and reduce their
January and February contributed
expense ratios. Adoption of more
to a 10% increase in fire losses.
efficient
operating
techniques,
This, coupled with a series of
particularly
through
increased severe
storms
in
the southwest
the
winds
a
basically improving trend of
underwriting results, is shown in
and
were
and
Perhaps
a
of
loss
Unfortunately,
at¬
by
its
stayed
catastrophic storm losses
weather
directions. Increases
underwriting
reduced
casualty
by a life in¬
company licensed in New
Esther,
achieved.
several
represented
fire and
a
company
and
sea
To Bad Weather
lines, particu¬
larly in the automobile bodily
injury and property damage lines,
which
more
Property Losses Increased Owing
im¬
underwriting problem
several
rates
the
on
insurance also has contributed to
provement in underwriting profit
margins has been achieved as the
fire and casualty insurance com¬
panies
placed
savings
in
insurance
operating costs.
the fire and casualty
business.
Since
that
however,
year,
had
Insurance
—
The year 1957 represented one
the worst loss years in the
history
York
examination
four
descrip¬
6
*35
New
combined
tive
compa¬
caused
hurricane
the
ratios of
fire
of
mergers
insurance
and
which
An
of
Mexico
moderate
surance
in
of
stock
gate
element
September 10 and 11 of this year
whipped into Texas from the Gulf
area.
Fortunately,
the
second
major tropical storm of the season,
York.
effects
heading.
Development
implica¬
catastrophic property losses in that
insurance
total
related
a
future
of the recent decision of the
of Appeals of New York
State
which
reversed
the
ban
surance
in¬
net
the
action
Dividend
under this
possible
acquisition of
re¬
category
in
and
surplus
position.
this
made
income
of stock market
holders'
of
Department
Included
would
combinations which
place and considera¬
Court
to
expenses
the
taken
46
The Commercial and Financial Chronicle
Harold
E. Waeckerle,
Parker/Eisen/Waeckerle/Adams & Purcell, Kansas City, Mo.; Mr. & Mrs. Tom
Hilborne, Liberty National Bank, Oklahoma City, Okla.; Harry F. May field,
Commerce Trust Company, Kansas
City, Mo.
G.
Continued from page 45
that
vanced
by more than 5%
surplus increased by 10%.
and
1961
continued
has
and
is
to
date
provide
expected to
important
in
buffer
against the
increases in property insurance
losses being experienced as a re¬
an
sult
of
the
severe
storms
of
this
Based
on
representative
figures for a broad group of 210
year.
stock
insurance
companies, their
aggregate policyholders' surplus
as of Dec. 31, 1960, was approxi¬
mately $8 billion, so that a 10%
increase
million.
take
care
would
This
of
amount
would
a
to
more
fire
and
panies
rates
and
casualty insur¬
A large number of
casualty insurance
increased
to
their
com¬
dividend
shareholders
in
1960
despite the inroads made in under¬
writing
profits
hurricane
Donna.
More
companies
have
raised their dividends to date in
by
'
1961.
However, the
increases
year
of dividend
pace
of
this
probably will be slowed
as a
for
balance
the
result of hurricane
Carla's effect
$800
than
expected
investment
income
Dividends Increased
declared
steady
upward trend, however, and this
pave the way for future
the
casualty insurance companies ag¬
$279
million
in
1960
(including
policyholders'
divi¬
dends). This equalled 56.7% of
gregated
net investment income.
Exclusive
of
policyholders' dividends, the
pay-out percentage might be esti¬
mated at about 50%. This indicates
Company
Northern
and
Insurance
increases
when
another
Company.
Company.
Hampshire Insurance Com¬
pany and Illinois National In¬
surance Company.
Reliance Insurance
Standard
pany
Fire
Company and
Insurance
ard Accident Insurance
and
has
Insurance
Co.
Casualty
Company.
Insurance Company
Freeport Insurance Com¬
pany and The Standard Insur¬
and
fire
Company.
Court Decision May Augment
substantial
One
progress.
recent
some
of
along
with
tions
the principal
developments
factor,
which is
ex¬
pected to have important implica¬
The following combinations have
constituted
new
respect
to
future
developments in the merger move¬
this
ment
line.
the
in
field is
a
state
insurance
company
decision of the New York
a
to
purchase
a
con¬
not
right will be exercised
be
now
forecast,
nor
can¬
the
can
Based
that
on
market action of their
the
decision, it would
investors tend
Aetna
announce¬
to
appear
think
that
Insurance
Company and
Phoenix Insurance Company, both
of
Hartford, are the fire and
casualty insurance companies
most
likely to be involved. This
perhaps stems from the fact that
the companies
originally involved
in the case were both located in
(Connecticut
Life Insurance
General
Company and Na¬
tional Fire Insurance
Company of
Hartford), The chief effect
decision is to
remove
one
of the
possible
obstacle to future combinations.
Market
action
of
fire
the effect of hurricane Donna last
was
to
bring
prices
down
then. The Alfred M. Best Index of
30
fire
and casualty
insurance
stocks
42.5.
up
started
As
32%
the
year
1961
at
of
Aug. 31, 1961, it was
to 56.1. A study of the
price action of individual issues
Burns Bros. & Denton, inc.
TWO
indicates that the
highest quality
issues
NEW YORK
which
are
universities.
Outlook for 1962
looking
would
ahead
outweigh the
Despite the hurri¬
losses,
the
basic
factors
relating to underwriting appear
to be on the plus side. Definite
negative
ones.
cane
is
progress
solution
made
Mergers
expenses.
binations
efficiency of
the industry.
Members: The Toronto Stock Exchange
\
Members:
The Canadian Stock Exchange
of Canada
At
to
make
are continuing
possible good gains in
and in net investment
income.
Significant Developments in
The
Life Insurance Field
In 1961
From the
ment
standpoint of Invest¬
Bankers,
the
most
Toronto
Ottawa
Winnipeg
Montreal
Vancouver
Calgary
Hamilton
affairs
in
1961
has
been
the
advance in the price of the stocks.
Shares of life insurance companies
have had
from the
the
a
rather steep increase
levels which existed at
beginning of the
end of
AND
year.
At the
December, 1960 the Alfred
DISTRIBUTORS
Exchanges
Canada, England and France
A. E. Ames & Co.
Two Wall Street, New York
5, N. Y.
New York
BUSINESS
signifi¬
cant development in life insurance
Incorporated
Direct Wire Service To:
help
and
companies in
the same time
investment results
The Investment Dealers'
Association
com¬
to
many
Affiliated offices in
sixteen cities in
or
expected
are
increase the overall strength
Limited
Burns Bros. & Denton, Ltd.
toward
automobile insur¬
problem and toward reduc¬
ance
ing
being
of the
A. E. Ames & Co.
Company, Ltd.
it
the favorable factors
Members Toronto and Montreal Stock
Burns Bros. &
1962
appear
A. E. Ames & Co.
Affiliated with:
to
that, for the fire
casualty insurance companies,
and
Canadian
UNDERWRITERS
the
on
trust
Investment Securities
DIgby 4-3870
issues
companies, pen¬
funds, investment trusts and
sion
as
BROADWAY
NEW YORK 4,
line
approved lists of such institutional
surplus
and
second
average
In
following
the
gain was closer to
20%. Thus, the overall tendencyhas
been
to
favor the
highest
accuracy.
year
Underwriters and distributors of Canadian Securities
the
timing or the names of the com¬
panies involved be predicted with
stocks
M.
during this period showed
gain of over 40%
for
grade
this
not
or
James
average
investors
Whether
casualty insurance company stocks
has
been favorable
during the
past year, although the hurricane
news concerning the large losses
from
Carla depressed insurance
stock prices in
September, just as
KT2I
an
while
ganization.
Hartford
Mergers
casualty insurance companies
made
of
right of
stocks
trolling interest in a fire and
casualty insurance company or¬
ment of
Company
the
company licensed
in New York but incorporated in
Com¬
of New Jersey and Stand¬
upheld
insurance
new
New
of Appeals rendered
1, 1961. In this decision,
Court
Insurance
Hanover Insurance Company and
Massachusetts Bonding & Insur¬
ance
Thursday, December 28, 1061
Court
June
life
During the past 12 months the
merger movement among the
on
Company
and Kansas City Fire & Marine
Insurance
Springfield
under¬
State
the
Falls
.
.
Crossley; B. Franklin Houston, Dallas Union Securities Co., Inc., Dallas;
Powell, Boettcher and Company, Denver; E. Lynn Crossley,
Municipal Finance Officers Association, Dallas
Company.
Glens
ance
aforementioned list of 210 fire and
Lynn
New Haven and New Amsterdam
its
continue
to
writing results show improvement.
by
Great
Security
be
can
should
losses.
Insurance
Federal
E.
underwriting results for 1961.
on
dividend
Dividends
good margin of
dividends for the
a
company.
Net
substantial amount
of underwriting
ance
is
for
fire
average
The upward trend of investment
income
and
values
of
equities
owned
there
coverage
Mrs.
.
ESTABLISHED 1889
Volume 194
Number
6120
.
.
The Commercial and Financial Chronicle
.
47
a i
Wallace D.
Johnson, David A. Noyes A Co., Chicago; John C. Schutz, Chiles-Schutz Co., Omaha, Neb.;
J. Leonard, L. F. Rothschild A Co.,
Chicago; Richard C. Nongard, Nongard, Showers A
Murray, Chicago; Milton J. Hayes, American' National Bank A Trust Company, Chicago
James
Richard
M.
Best
of
&
Company index of 30
At the
end
be realistic to expect
centage gains in each
September, 1961 this index
was
life
life
stocks
341.9,
in
increase of 77.2%.
an
The
1961 has been
year
which
institutional
have
been
tions
are
holders
193.0.
was
to
a
year
investors
heavy buyers. Institu¬
generally
and
do
long-term
not
trade
the
stocks. As
they "lock up" sizable
blocks of stock, the already thin
markets become tighter. In other
words a supply and demand factor
is injected into the market prices.
Although most analysts seem to
agree that current times earnings
multiples are high enough,, the
stocks do have support at present
levels.
insurance
stress
and
far in
so
able,
total
surance
5.6%
period in
billion
1960.
life
Of
in¬
in¬
an
the
over
68.3%
or
of
$57.1 billion
were
of
crease
the latest data avail¬
purchases
same
that total
$39
of
sales
were
ordinary life insurance, $12.8 bil¬
lion
or
22.4%
$5.3 billion
ance.
life and
industrial insur¬
was
was
Ordinary
normally
the
group
insurance
sales,
stable
most
and
profitable type, increased less than
V20f 1% over the same period of
1960,
industrial
increased
group
about
insurance
1%
and
insurance increased
sales
sales
of
imately 28%. The large increase
in
group
sales was partly ac¬
counted
for
by one large case
which was slightly over $2 billion.
not
keeping
up-surge
from
1946
sales
to
in
the
It
1956.
Midland
period
would
however,
any
insignif¬
nine month
an
er
has
insurance
been, of late,
buying term
on
which
has
little
if
savings element and is cheap¬
than
chases
with
whole
of
life.
life
term
the
These
coupled
mutual
are
purchase
pur¬
of
surance
its
industry has lost some of
pension business to the
group
banks.
Variable annuities
method
one
insurance
by
which
industry
be
can
life
the
recapture
can
other
the
on
types
sold.
Until
life
of
life
or
form.
recently
purchased
survivors
death
past
of
the
of
10
public
For
years.
insurance
aware
threat
to
a
and
the
years
life
industry
reputation
on
a
has built its
promise to pay a
certain
happening
of
sum
the
upon
specified
event,
the passage of a
specified period of time.
As the
purchasing power of the dollar
declined, the insured's only pro¬
either
death
tection
a
insurance
more
its
many
insurance
the
versus
fixed dol¬
Variable
Annuity.
Annuities have
During the
the insuring
years
and
is
been
sold by
or
companies
However,
of
have
like
their
life
fixed
specifically
and
of the
some
buyers
are
often
invested
Therefore,
the
life
in
ties.
at
set up
reserves
The pension reserves would
be kept in a separate account and
not
co-mingled with straight life
insurance
All
reserves.
plans have advantages
of
these
penicillin, sulfa and the
The
gains
made
in
and in
general public
health during past years do, how¬
ever,
continue to keep current
mortality rates at a very satis¬
medicine
factory
progress
and heart disease would prove
cer
of
level.
Any
significant
in the treatment of can¬
material
future
Investment results in
con¬
rates
search for attractive
in finding
them.
being
company's approach to the prob¬
stocks.
The
lem.
indicated
from
standpoint
the
experience
and
in¬
investments
they have, in the main, succeeded
rently
one
shares
insurance
priced
are
as
supports
them
as
should do
commitments
long-term
well.
very
purchase more in¬
hope that he would
enough to fill the need in¬
sured against at some future date.
in the
Because of the increased
of
the
fixed
are
aware¬
inflationary pressures, and
surance
nature
of
program,
turning
to
the
life
the
in¬
people
many
not
equities
protect
future
in
some
purchase
them
form
from
purchasing
a
to
BONDS
of
STOCKS
help
decline
power.
As
in
a
Markets maintained in
Canadian Corporation
Dealers in
all classes of Canadian external
and internal bond issues.
!
Canadian Securities
Stock orders executed
2
the Montreal and Toronto Stock
on
WALL STREET, NEW YORK 5
Exchanges,
WOrth 4-5280
v:/.-r
'
';/■]
DIRECT
Affiliated with:
Midland
net New York markets quoted on request.
or
,
'
:
PRIVATE
'
■,
WIRES
TO
.""
;
■
'
..
'
;
■'
-
■.
TORONTO, MONTREAL, OTTAWA, WINNIPEG,
CALGARY, VANCOUVER, VICTORIA AND HALIFAX
Securities Corpn.
BELL
Limited
SYSTEM
TELETYPE
NY
1-702-3
Member:
The Investment Dealers' Association of Canada
The
Midland
Dominion Securities Sep oration
Company
Associate
The Toronto Stock Exchange
Montreal Stock Exchange
London, Eng.
Ottawa
Canadian Stock
Halifax
40 EXCHANGE
Stock
Exchange
PLACE, NEW YORK 5
Telephone WHitehall 4-8161
Exchange
Calgary
TORONTO
Member American
Boston
Member:
MONTREAL
LONDON
Canadian Affiliate
—
Member Toronto, Montreal
and Canadian Stock Exchanges
this
position. Investors who purchase
have
ness
cur¬
growth
past record plus the
potential
to
was
surance
rea¬
sonably favorable level and while
the
industry
must
constantly
the individual
mortality
the
1961
Life
of
to
tinue to be excellent. Money
have been maintained at a
is
The year 1961 has been a satis¬
benefit
industry.
as
on
ex¬
as
one
as
which
and
Mortality
miocines.
well
disadvantages
factory
in¬
invest
to
against pension business in equi¬
have preferred to
monies
securities
Many buyers used will depend
annuities which
pension plans,
life
many
provide
dollars.
annuities,
equities.
for
these
policies
guaranteed
of group
least
Annuities
approach to the prob¬
lem of inflation
lars
come
the
of
of fixed guaranteed dol¬
program
sure
event
become
inflation
up
insured.
15
or
has
lars.
the
Another
of
some savings
protection to
as
Variable
was
policies built
well
in
most
variation
some
The
as
being
quite
insurance
whole
coverage
and life insurance.
are
results.
perience
is
not
improving
as
rapidly as it did during the pe¬
riod
immediately following the
advent
of
the
"wonder
drugs"
such
this business.
There
vestment
are
with the great
pace
in
a
life
there
emphasis
more
Jamieson, Glore, Forgan A Co., Chicago; Aaron Katz, Troster, Singer A Co., New York;
Troster, Troster, Singer A Co., New York; Lyle F. Wilson, Pacific Northwest Company,
Seattle; F. W. Pershing, Pershing A Co., New York
approaches to
funds
to
attempt to provide a this
problem
which
are
more
program
which will keep pace favored by the industry.
Many
more and more life insurance will
with the cost of ^ living as well life insurance
company
officials
be sold.
as
provide
protection
in
the believe that they could solve this
event of death.
There are in ex¬ problem if they were allowed to
Mutual Funds and Life Insurance
istence today a fair number of segregate funds.
By this, they
The year 1961 has seen a con¬ large agencies whose salesmen are mean to invest the reserves set
up
tinuing change in the emphasis licensed to sell both mutual funds against life insurance in fixed in¬
approx¬
Purchases of life- insurance
for
result
The
continues
As the population of this
country continues to expand there
is every reason to believe that
features
1960
1961 are greater than they were
in 1960. For the first nine months
of this year,
figure
cash values and had
Life Insurance Sales Up 5.6%
Sales of life insurance
its
per¬
period.
that
Over
industry
product,
$57 billion is not
icant
such
year.
P.
Col. Oliver J.
T oronto
Montreal
Winnipeg
Vancouver
Victoria
48
The Commercial and Financial Chronicle
of
rate
Report of the IB A
Public Utilities Committee
Brown, Partner, Dean Witter & Co., New
York City, presented the
following Report of the
Since reporting to you a year ago
the
status
of the
Public
Utility Industry, we have been
through trying times both on do¬
mestic and innational
fronts. We
are
see
"cold
a
trol
util¬
industry,
the telephone
industry, and
situa¬
we can
do
rights and affect
our
domestic
over
matters.
us see
stalwarts
of
the
American
econ¬
omy.
have
through
We
perhaps must be reconciled
happened in the case
to what has
1960-1961
of
the
Tennessee
Valley Author¬
ity, which initially was created
for the purpose of utilizing a small
recession with
outstanding
results.
They
Carl C. Brown
shown
earnings,
dividend
international
just what has been hap¬
pening which is tending to weaken
the utility industry, one
of the
compa¬
higher
exercise
Let
distribu¬
have
the
over
tion, there is much that
ity
the
war"
being waged
within our own land against in¬
vestor-owned
utility companies.
While we have little, if any, con¬
decisions
come
made
distributions
greater
and
expe¬
Government
hydro-electric
ect and
now
largest
steam
generating
country. You
tion in the
proj¬
has evolved into the
opera¬
not
are
rienced substantial appreciation
unfamiliar with
their
Government's enlarged interest in
of
The
stock equities.
common
electric
utility industry is in an
especially favorable position to¬
day, because of its large excess
reserve
capacity position to han¬
dle
greater
and
its financial
it
to
take
of business,
strength enables
volumes
of
expansion re¬
quirements with relative ease. We
cannot say the same for the natu¬
ral
gas
transmission companies,
care
which have weathered the
sion
in
terms of
done
ness
but
volume
reces¬
of busi¬
suffered
have
de¬
terioration of investor confidence.
With this note of
cheer,
we
wish
to turn to the
problems of the fu¬
ture.
score we
On this
ford
to
cause
become
we
see
cannot af¬
complacent
be¬
signals
state of the country subsi¬
dizing the operations of the TVA,
when
private
companies
could
have done the job with a resultant
tax payment to
to the Federal
Power
mounting
have
developments
harassed
industry
on
a
the
electric
number
Public Power advocates
of
tion's Capital. While all of
acts
of
accustomed
"cold
war"
Gov¬
now
rural
being
not
areas
receiving
power
from the utility companies.
Since
the
Act
passed many
years ago, over 97% of the rural
was
country
that the need for
Administration
this
conceived
and
a
hydro-electric
have
the
waged
power
help from the
negligible.
now
the
has
REA
bigger business, planning
build
sive
is
fact,
ade¬
are now
plan to put itself into
fronts.
to
test
based
for
steam
power
plants
transmission
and
and
exten¬
systems.
doing, taxpayers' receipts
even
In
are
so
be¬
Today loans ap¬
to be made just for the sake
of making them, without notice or
opportunity to affected persons to
be heard in public hearings. For¬
tunately, in some states, there is
a safeguard in that, before these
projects can be built, they must
receive State Commission approv¬
al
under which
proof must be
given that they are essential and
in the public interest.
Unfortu¬
states. Not only is
bad, since it makes
citizens subject to higher taxes
many
our
subsidize these operations, but
is bad from the standpoint of
to
it
weakening
the
companies in the
investor-owned
area,
since REA's
with their power rate advantage
are in a position to draw indus¬
tries and large customers away
from
companies in adjoining
At
time
a
when
the
areas.
nation
is
confronted with
keeping our own
strong, when citizens are
being taxed at an excessive rate,
economy
and
when
the
government has
a
budget which is substantially out
of balance, why do we encourage
the
use
of Federal funds for these
REA
loans
cate
facilities
which
On still another front,
ment action is
Govern¬
producing duplica¬
unneces¬
In the Public Works
Appropriation Bill passed in the
sary waste.
last
session
tion
an
Project.
the
construc¬
transmis¬
in
connection
Colorado
power
from
markets.
Glen Can¬
plant
the Upper Colorado
on
River in the State
the
with
Basin
hydro-electric
new
being built
in
River
This has to do with the
taking of
a
funds
all-Federal
system
Upper
yon,
Congress,
provided for
of
sion
the
of
Five
of
Arizona, to
private companies
immediate
area
already
have extensive transmission
tems and
an
interest
are
completely
sys¬
prepared to imple¬
without
the
need
job
of
deliberations
Still
many years.
ing
Hanford Project Defeated
On another front, we have ob¬
served this year
proposed Federal
legislation to make atomic power
at the Hanford Plutonium
in the State
of
Project
Washington avail¬
able for sale to Southern Califor¬
nia by way of the construction
of
schemes
being
Washington of tying
consideration but will likely come
again
It
in
was
when Congress
January.
recon¬
proposed to give
of increasing capital spend¬
ing and plant modernization, but
pose
the
advantage to
This discrimi¬
same
utility companies.
nation
was
based
the supposi¬
on
tion that utilities would spend in¬
Projects
with transmission systems so that
dependent of incentives since their
spending are a function of public
Bonneville, Grand Coulee, Hoover
Dam, Central Valley, TVA and
taxes would be passed
others will
sumers
Federal
Hydro
all
in
all
Electric
-
be able
to
inter¬
change power. This would be a
very expensive undertaking and
would be a duplication of facili¬
ties
that
are
available.
now
In
requirements,
are
fallacious.
terchange of
modernization
supply
owned
scale, investorutility companies
have announced their intention to
double their investment in trans¬
mission lines
of the
this way service will
a
most
be
ren¬
dependable and
economical basis.
tion
with
this
electric utility industry, as
evidenced at recent confirma¬
hearings,
certain
year
to
Commission.
was also concerned
appointments made
the
memorandum
a
many
years,
with
facilities at a cost of
lion, if the tax credit
modern
$40
Apart from effect of mod¬
ernization, the utility offered to
pass along the reduction in cost
Federal
These
Power
include
two
taking
any
position
dom of this tax
on
the wis¬
scheme, it is hoped
that if such legislation is enacted
the
utility companies would
ceive
the
same
treatment
other American
enterprise
dustry.
Northwest.
Natural
Another
member comes from
a
state
Gas
as
no
natural gas is available
Limited
Established
14 Wall Street
Investment
& Sons,Inc.
Securities
New York 5, N. Y.
Telephone
DIgby 9-2850
Branches in
1903
Office:
West,
/y
Montreal 1, Canada
principal Canadian cities
Underwriters and Distributors
Canadian Government,
Public
Municipal,
Utility and Industrial Issues
Canadian Affiliate
James Richardson & Sons
Established 1857
ROYAL
SECURITIES COMPANY
Members
of Montreal, Canadian, Toronto,
Winnipeg and Vancouver Stock Exchanges
Serving Investors Across Canada
ROYAL
Two Wall
in¬
Last year we brought to your
attention the regulatory situation
ROYAL SECURITIES CORPORATION
244 St. James Street
or
Industry Also
trading
Head
re¬
any
Under Attack
t
where
mil¬
avail¬
were
associated with public
power, one
new
to
mittee, proposing to replace im¬
mediately old generating capacity,
that would
normally not be retired
members, whose record is closely
Pacific
one
coun¬
to two million
customers. Without
The
was
largest utilities in the
try submitted
able.
throughout the United States.
on
expansion,
technological
the House Ways and Means Com¬
basis
dered
for
and
tive position of the
utility indus¬
try against other beneficiaries of
the tax program.
for
over
In
invest¬
utilities
help to stimulate the
growth and strength of the econ¬
omy and maintain the competi¬
requiring an outlay
$7 billion. By the end of
1970 the major power
systems thus
will be in position to
operate their
properties on an interconnected
of
benefit
a
Apropos the tax stimulus,
broader
electric
by
tax
capital
would
ears.
a
of
stimulate
advance. Reduction in taxes would
souri River are short of
power. So
far such propositions have fallen
deaf
availability
ment
permit lower energy costs which
electricity when Federal hy¬
dro-electric plants along the Mis¬
On
prem¬
Industry
re¬
power
with
on
in¬
not
Midwestern
companies have offered to
the Federal Government
power
no
spokesmen have pointed out that
would
efficiently all
Similarly 14
in
con¬
are
subject to competition. The
ises
the
most
to
on
and, therefore, be
overtures to Federal Projects such
as the TVA to
bring about an in¬
serves.
reduction
centive and their facilities
fact, private companies have made
power so as to utilize
also
complete facilities for Canadian
James Richardson
tax
a
credit to companies for the pur¬
the
the
stock and bond
legis¬
dustry but would deny it to the
industry. Such tax
legislation was not cleared for
denied
^
grandiose
considered
in
connection
Federal tax
electric utility
venes
also
in
was
legislation
was
proposed
which would give tax benefits to
a
large segment of American in¬
Government in direct competition
are
Proposal
In the last session of Con¬
lation.
with
There
year
Tax
gress
up
gress.
over
development dur¬
proposed
expensive high-voltage trans¬
mission line putting the Federal
an
another
the
with
with the TVA and the other with
CANADIAN SECURITIES
its
Discriminatory
territory for
feated in the last session of Con¬
in
in
important natural gas indus¬
this
able
ment these in order to do the
schemes at
try.
nately this safeguard is not avail¬
ment to lend money to these
necessary
the Federal Govern¬
competition with the pri¬
investor-owned
companies
operating adequately in the area.
Fortunately this project was de¬
this situation
mission
states
the
Federal
REA
an
ing used by the Federal Govern¬
un¬
the
to
Government.
the
also puts
sound business
on
having little, if any, knowl¬
edge of the industry. These ap¬
pointments must also be scruti¬
nized from the standpoint of the
difficult problems facing the Com¬
vate companies which have served
considerations.
pear
were
of the
to
us
original
was
tant
giant in
Administration, which was
originally designed to bring elec¬
tricity to farmers located in dis¬
new
have
The
loan
tion of expenditures and
have another
we
to
taxes
individual admit¬
ted
lines with result¬
own
of
losses
and
It
tion
Now
which
now
and
the making, the Rural Electrifica¬
utility
stronger representation in the Na¬
become
purchase 4%
largely dupli¬
already available
and fully "supplied
by the inves¬
tor-owned utility industry.
Despite
there have been
year
Government
reduced the tax bill of the Amer¬
ican citizen.
so
During the
municipalities and
quately served with electric
Gaining Strength
the
that
every
ap¬
pearing along the horizon.
Advocates of Public
the fact
TVA has resulted in taxpayers in
areas
storm
to
bonds.
ant
the
where
and
a
Interior
seems to ignore the
utility companies and
to duplicate facilities and
ment in
against the United States by for¬
we are disturbed to
to
nies,
Fed¬
REA's Lending for
eign nations,
electric
tion
2%
borrowed
the
offer of the
proposes
these
Thursday, December 28, 1961
Department
to build its
of
some
.
.
having to spend
Nevertheless
dollar.
where
have
ernment
the Government
instances that have been
funds
eral
Committee, of which he
delighted to
report that the
gas
are
reported
"Lending Sake"
about
e r
There
Chairman:
was
t
when the Government itself pays
to borrow long-term money.
4%
REA's
Carl C.
Public Utilities Securities
2%, giving these projects
operating subsidy,
substantial
a
.
SECURITIES INC.
Street, New York 5, N. Y.
Volume 194
Public
Number
6120
respect to the natural gas
industry.
We pointed out that
heretofore
the
Commission
customary
Federal
had
Power
permitted
of
rate
return
vestment in plant,
area
overall rate of return.
regulation
on
the
in¬
on
in the
rity holders relied
of
of
Secu¬
this method
to invest
try between
hundreds
a
when
1950-1960
the
occurred.
Last
the Commission went off on
greatest
growth
tack
new
mula to
and changed
rate of return
a
its for¬
on
com¬
stock
only, and arrived at
10% and 10x/2% return on this ba¬
mon
sis.
characterized
We
method
return
of
to
companies
this
new
determining
rates
natural
pipeline
gas
"skin
being
as
of
and
bones" treatment and furthermore
that
it
changed the rules of the
in the "middle of the game."
game
Furthermore
in
Companies
method
this
penalizing
sarily
The Commercial and Financial Chronicle
.
the
new
which had been
set
up
on
a
results
pipeline
thin
companies do not know, and
not know, for a number of
years what earnings they will be
able to
eral
keep and what the Fed¬
Power
Commission
termine must be
rate
proceedings that
years and more.
We
de¬
refunded to the
because of
payers
will
open
back
run
rate
five
also concerned with the
are
apparent
anti-attitude
in
Wash¬
ington toward large strong com¬
panies which have a vast number
of
stockholders.
field
In
the
have in mind the
we
utility
situa¬
this
At
moment
fect
panies in
rigidly
one
hand
have
we
necessity
of
saries
launching
in
tinental
system,
beating
satellite
we
realized
are
our
an
the
adver¬
intercon¬
communication
creating apparant
ring
private
companies
proceed¬
goal.
companies
opment
other
cause
gas
as
devel¬
might be the forerunner
vestments in that
are
a
further deterioration
a
were
rates,
step, and such
for
of
industry.
problems
in¬
There
which
give
in the natural
concern
industry, particularly
Regulation
pos¬
reducing
dividend
present
the initial
to
Local
If it
as many
1961
year
The
the
Reassuring
utility
industry
is
that
the
greatest segment of its operations
is still
local
subject to regulation at the
level,
within the states
municipalities.
missions
have
ties
sound
rate
and
The
State
municipal
continued
a
or
Com¬
authori¬
sane
and
policy of regulation. Where
assistance is needed by indi¬
vidual
companies
forthcoming
it
has
firming the fair value principles
laid down by the State Supreme
Court in 1957.
Power
Court set aside
Company.
Likewise there
reasonable rate decisions in
were
Also
of
the
matter
gard
to
tion
Ohio
Electric
Columbus
&
Southern
Company, and in
Indiana, affecting Public Service
Company of Indiana.
The New York Commission al¬
lowed rate increases for New York
State Electric & Gas Co., Niagara
and Consoli¬
A conflict with¬
in the California Commission
was
in
New
Mexico
a
Southern
a
ira
District
Union
case
Carl H. Doerge
Wm. J. Mericka & Co., Inc.
of
Cleveland, Ohio
Gas
Co., a
brought to your atten¬
we
C. Pharr Duson
Rotan, Mosle & Co.
year ago.
Houston, Tex.
Generally speaking, at the state
local
or
receive
the
level
utility
fair and
which is
ment
Fred
companies
consistent
New
treat¬
investor
serves
confidence
public utility securities.
signals
concern
Pacific
Gas
Electric
&
and
the
Southern California Edison Com¬
panies, and some rate increase was
given San Diego Gas & Electric
Company.
State Courts have also been in¬
strumental
are
G. H. Walker & Co.
and give
only
PUBLIC
UTILITY
Carl
C.
Brown,
a
decision in the
mont
Natural
tablished
in
concurred
of the Pied¬
case
Co.
Gas
and
proper
high¬
rendering
which
fair
es¬
stand¬
ards for regulation in the State of
There
were
decisions by courts
Iowa
Gas
•
affecting
in the State of
the
and Electric
rate
Iowa-Illinois
Company, reaf¬
Milton
Co.
A.
deB.
Drexel
&
New
F.
Lewis
& Co., Inc.
York, N. Y.
George L. Perin
The First Boston Corp.
New
Bell
York, N. Y.
Albert E.
Co.
Schwabacher, Jr.
Schwabacher & Co.
Philadelphia, Pa.
D.
Jones
G. Becker
New
New York, N. Y.
George
San
Boynton
J.
Boynton & Co., Inc.
York, N. Y.
Francisco, Calif.
Raymond Smith
Weeden
New
John H. Brooks
& Co., Inc.
York, N. Y.
Carl Stolle
Putnam & Co.
G. A. Saxton &
Hartford, Conn.
New York. N. Y.
Co., Inc.
been
satisfactorily and
promptly.
CANADIAN SECURITIES
IN THE UNITED STATES
Our office in New York maintains active markets in Canadian bonds
and other
and
high-grade Canadian investment securities for institutions
We are connected by our private wire system with
Canada to provide prompt and reliable service on all
dealers.
offices
Underwriters and
Distributors
across
Canadian markets.
of Investment Securities
M'Leod,Young,Weir,Incorporated
1 Chase Manhattan Plaza
*
New York 5, N. Y.
Telephone: WHitehall 4-1770 * Teletype: N. Y. 1-4808
An Affiliate Of
McLEOD, YOUNG, WEIR & COMPANY LIMITED
50
KING
STREET
Dominick
Sherbrooke
Quebec City
Ottawa
&
Dominick
Members New York, American and Toronto Stock
Exchanges
WEST, TORONTO, CANADA
14
Montreal
Hamilton
Kitchener
London
Windsor
Winnipeg
Edmonton
Calgary
Vancouver
Correspondents in London, England
WALL
STREET, NEW YORK 5
320 Park
Buffalo, New York
Corp.
Mitchum, Jones & Templeton
Los Angeles, Calif.
William N. Bannard, III
American Securities Corp.
E. D.
constructive
Richard W.
York, N. Y.
Elwood
North Carolina.
SECURITIES
Chairman
New
Securities
Nashville, Tenn.
COMMITTEE
Carolina
court
Glore, Forgan & Co.
Chicago, 111.
Equitable
State
est
Charles F. Glore, Jr.
Respectfully submitted,
Dean Witter &
where
for
tax¬
investor.
every
decisions in the
North
cause
every
Morgan Stanley & Co.
New York, N. Y.
Willard R. Hendrix
cite for example
of
to
_
Roger T. Gilmartin
It is only
in the country but also to
payer
in
strengthening the
position of the utility industry. We
up
not
Co.
Providence, R. I.
in
.
largest utilities in the State, the
&
York, N. Y.
W. Ronald Gill
to
at the Federal level where danger
reconciled to clarify and strength¬
en
the | rate position of the two
W. Fairman, Jr.
Bache
real bulwark to
a
utility industry and
maintain
mjaty
Lehman Brothers
New York, N. Y.
unfair decision
an
the Commission in the
Michigan, affecting Consumers
Power Company; in Ohio, in re¬
both the lower court and the
reassuring strength of
one
have
we
fair and prompt decision in
a
the State of Arizona affecting the
Tucson Gas, Electric Light and
philosophical obstacles and deter¬
ing at full speed to reach their
enforced, it could result
several
their
industry.
During the
had
Telegraph Company. There have
been threats reported which would
require the telephone system to
be broken up. Also, while on the
how badly it will af¬
ihe
Mr. & Mrs. Milton G. Hulme, Jr., Glover & McGregor, Pittsburgh; Mr. & Mrs. Addison W.
Arthurs,
Arthurs, Lestrange & Co., Pittsburgh
dated Edison Co.
equity
not
Co.,
Mohawk Power Co.
neces¬
number of important com¬
a
in
it is
&
49
tion of the American Telephone &
basis.
sible to say
Witter
of the
may
of millions of dollars in the indus¬
year
.
Utility Securities Committee, Breakfast Meeting—Carl C. Brown, Dean
New
York, Chairman
with
6%
.
Avenue, New York 22
Portland, Oregon
Seattle, Washington
j
50
The Commercial and Financial Chronicle
Thursday, December 28, 1961
.
.
.
t
segments
ous
Report of the IBA
economy
attached
Canadian Committee
Alexander, General Manager of James
Richardson & Sons, Winnipeg, Canada, as Chair¬
man
of the Canadian Committee, submitted the
following Report to the Convention.
While
high
a
level
of
economic
has
been
of broad
plexity
i
fluenced
v e
1
o
p
n
•
-
or
clical
nature
those
cy¬
of
term
a
or
perman ent
the
Norman J. Alexander
in¬
1960
the
the
domestic
balance of trade;
inflow
tion
and
tion
of
an
of
almost
non-farm
static
condi¬
business
inven¬
though of mod¬ tories both in Canada
est
proportions may be viewed U. S. A.
with a degree of satisfaction.
It
also
is
industrial
resource
the
foreign capital
funds because of an inadequate
rate
of domestic
capital forma¬
in the Gross National Prod¬
in
uct
On
were
heavy
tances,
real
crease
materials
raw
excess
tial adverse
these cir-
c u m s
and
with
scene,
there
problems of a labor
force rising at a rate faster than
it is being absorbed; a substan¬
as
character. Un¬
der
dowed
en¬
such
competition im¬
poses
special problems so that
Canada today is facing one of the
greatest challenges in her history.
tem¬
well
long
ex¬
capacity,
porary
as
felt
dc-
ments
a
even
probable
that the real
and
in
the
Situation Now Much Better
or
physical volume of production in
1961 will also be somewhat larger
The situation in the latter part
of
1961
improved considerably.
than that of 1960.
There
Canada
of
year
material
excess
ly
1960, the first
decade with a
amount of
capacity in
percentage
force
competition
from
world
a
distinct prospect
year
of
a
in merchan¬
trade; the inflow of foreign
capital
of her rising
funds
has
eased
and
de¬
spite the increased level of final
Rising expenditures, business inventories
unemployed.
on
dise
relative¬
a
is
surplus for the
new
of demand and
high
labor
entered
a
appear
markets
are
beginning to
Detailed
Europe and Japan with their
grow.
statistics
Product
Prices
rose
that
so
vari-
two-thirds
half
that
As
in
Personal
Saving
Business
Saving
a
various
987
359
-57
^115
-35
Residual
that
in
1960
the
service
Tel.
In
the
Montreal
1
Cornhill
London
E.
C.
3
National Product
in
1960
Balance
chases
and
business
appreciably.
rose
auarter
in
Canada
In the second
Cdn.
Direct
All
clined
by
inventories
Final purchases in the third
s
8.921
$
1,439
-
333
~
-
105
$ 7.93$
1,191
-
$
1,083
-
$
1,131
1,494
$
-
1,270
$
-
-48
-55
-79
de¬
or
Capital Account
$
690
$
Abroad
Invest.
and
$
550
-80
-48
bonds
218
617
610
447
407
149
$
$
1,270
$
1,494
rose
*
Capital Expenditures
Government
Total
the result that
business
inven¬
tories continued to decline. In the
final quarter of the year both the
end
product
and
inventory
began to exert
sionary influence on
National
Product.
however,
were
by
the
Canadian
in
export
less Government Deficit.
annual
of
rate
gains
1958
declined
demand
the
uptrend
and
the
at
was
a
1959
In
rose
to
an
of
again
1960
1961.
40%
of
when
figures.
rise
in
government
sector
Reproductions
part,
included in
of
text
Bonds
Bonds
Public
40
Industrial
Bond
Average
Bonds
5.17
4.72
4.87
4.96
4.93
4.15
5.17
4.79.
4.91
5.01
4.97
4.13
,5.30
4.97
4.95
5.15
Nov.
1
4.31
5.28
5.02
4.96-
5.09
5.09
Dec.
1
4.42
5.27
5.08
5.02
5.12
5.12
1
5.09
Jan.
1
4.48
Feb.
1
4.53
5.41
5.18
5.14
5.17
5.23
Mar.
1
4.65
5.52
5.17
5.17
5.17
5.26
5.38
5.14
5.14
5.22
5.22
Apr.
1
4.80
5.52
5.22
5.20
5.20
5.29
May
1
4.88
5.55
5.23
5.20
5.25
5.31
Ji\ne
1
4.94
5.71
5.39
5.47
5.42
5.50
July
1
4.94
5.84
5.52
5.47
5.63
5.61
Aug.
1
4.97
5.86
5.61
5.57-
5.60
5.66
5.29
6.20
5.97
5.78
Oct.
1
5.80
6.60
6.19
6.01
6.05
6.21
Nov.
1
5.45
6.53
6.06
6.00
6.03
6.15
Dec.
1
5.58
6.52
5.97
6.00
6.02
6.13
Jan.
1
5.70
6.60
6.12
6.04
6.14
6.23
Feb.
1
5.87
6.60
6.19'
6.17
6.22
6.30
Mar.
1
5.63
6.56
6.05
6.14
6.20
6.24
6.24
1
5.78
5.93
Apr.
1
5.43
5.79
6.02
6.00
6.01
May
1
5.34
6.06
5.74
5.93
5.91
5.91
June
1
5.22
6.06
5.73
5.83
5.82
5.86
July
1
5.13
5.88
5.54
5.58
5.56
Aug.
1
5.21
5.84
5.51
5.50
5.52
5.59
4.82
5.67
5.32
5.37
5.33
5.42
5.61
5.28
5.29
5.24
5.35
1
5.64
Nov.
1
4.92
5.60
5.40
5.33
5.39
5i44
Product
1
5.35
5.95
5.60
5.54
5.62
5.68
5.45
$36,280
CANADA
can
Long
Term
Term
Jan.
1
5.22
5.38
5.97
5.68
5.61
5.68
1
5.18
5.26
5.94
5.70
5.49
5.62
5.69
1
5.12
5.13
5.83
5.53
5.47
5.51
Mar.
30
5.18
5.26
5.85
5.65
5.51
5.61
5.66
May
1
5.10
5.31
5.92
5.74
5.54
5.68
5.72
sub¬
June
1
5.09
5.21
5.82
5.62
5.48
5.60
5.63
spend¬
June
30
4.83
4.98
5.71
5.37
5.37
Aug.
1
4.87
4.99
5.62
5.39
5.35
5.42
5.45
4.83
4.96
5.60
5.38
5.39
5.43
5.45
5.63
5.45
5.37
5.42
5.47
5.36
5.37
with
a
and
on
Medium
Feb.
cut
more
outlay
statistical
19^1
Mar.
had
bv
was
heavy
Utility
Dec.
consumer
continued
cial
resumed
compared
There
Provin¬
Bonds
average
10
4.77
of
which
farmers
Municipal
Dominion
yield
1
improvement
Canada
income
bond
Oct.
National
annual rate
The
10 'v
1
Sept.
annual
an
quarter
was
Gross
40
10
Oct.
Sept.
second
limited
1960, the
million.
to
company
Term
3.96
1
Sept.
re¬
expenditures. Desnite these gains,
however,
the
Gross
National
Product
Aug.
(seasonally
$36,436
&
10
'
Gross
products.
last quarter of
National Product
weir,
young.
Long
de¬
somewhat
decline
a
mcleod.
exoan-
an
The
Continued
bv
small
51
page
data,
1
Sept.
Oct.
2
4.89
5.02
Nov.
1
4.77
4.92
in
Source s
matter.—Ed.
5.56
McLeod,
Young,
.
5.59
5.47
5.48
5.35
Weir & Company Limited
-
50
5.41
King
St.
W.
Toroi
Ontario
BONDS
Gairdner
Mason & Crysdale
320
%
Gompani) Limited
Bay Street, Toronto, Canada
LIMITED
We
provide
in
Canada.
Members:
The Investment Dealers* Association of Canada
•
a
complete service for
Private
enquiries
corporate
from dealers
financing
invited.
Affiliate
Members:
The Investment
Gairdner &
Dealers' Association
TORONTO t
60 Wall
of Canada
Company Inc.
Street, New York
EMPIRE 6-8961
Bellman H. Mason
Peter S. Crysdale
Mario D. Saunders
1,131
quar¬
relatively sharply but the
strength was only par¬
tially reflected in production with
*
302 BAY STREET
420
-85
in
items
other
Payments
Invest.
Transactions
stocks
International
of
renewed
the
of
$
nearly the amount of
the increase in the first quarteri
ing;
Commission
207
8,613
net
Balan&e
Foreign Direct
business
ter
$
297
$
-
-
Balance
while
stantial
Power
316
8,364
&
Funds
inventories
both final
<
Electric
$
$
Account
Current
Net
1960
Hydro
8,200
Account
Migrant
purchases and
the value of production declined
than
and
$
activity
eased
in
to downward tendencies
quarter there was a slackening in
the growth of total final pur¬
net
Ontario
$
on
Inheritance
in several components of the end
product demand. During the first
Western
of
$
Error
was
level
the
as
be viewed with satisfaction in the
light of the drought conditions in
Province
$
6,612
economic
response
million.
Specializing in
6,975
—IxlSi
$
*;
Gross
of
Net
brief, the rate of growth of
interrupted
the
52
$
1.923
8,417
7,482
Ltlfifi
Current
tries..^-':
In
129 St. James Street W.
6,894
$
investment
as
Residual
$36,012 million because of
the unusually sharp increase in
dividends paid abroad during the
period.
EMpire 2-5751
6,843
7,422
Inventory Change
produc¬
rate of
1
$
$
Public
counter-balanced by a substan¬
tial advance in outlay for new
housing; the material
improve¬
ment in export demand and con¬
tinued
strength
in
government
55 Yonge Street, Toronto
104
-206
Error
Private
seg¬
ing industries grew slightly more
than the goods producing indus¬
1,674
4,741
779
the
first
quarter
of
1961, the
somewhat softer end product and
inventory demand was more than
Harris & Partners Limited
$
1,754
5,062
5,121
Inventory Adjustment
Spent
the
$
1,675
$
26,024
$ 6,843
7,482
general, however, it might be said,
adjusted)
Affiliated with
$
7,422
$
4.784
27,375
4,893
Government*
of the economy, there was
lack of uniformity of trends. In
record
WHitehall 4-0731
28.527
5,128
Available
Balance
$21,240
$22,482
$23,409
Government
ments
Gross
Tel.
of
1959.
between
In the
Street, New York 5
services
Private
Despite this, however, even the
physical increase was only about
stricted
15 Broad
in
1.7%
some
about
the gains in the GNP represented
increases
in
actual
production.
for
Harris & Partners Inc.
goods
Spent on Consumer
in
$32,867
$34,857
$35,959
Product
National
Groas
rose
mand
the
on
perti¬
and
Gross National
-
com¬
figures
nent.
1959.
was
with
both of
however,
1960
keenly by Canada. To an
porting
nation,
plentifully
and
y
would,
1958
1222
million®
sharply with the 6.1% increase in
very
b y
domestic
external
Asia and South America
one
Some
these
"
12§o
the
by 3.2% over 1959 to
$36 billion. This growth contrasted
plant and equipment con¬
structed in the post-war years and
from the growing output of the
less developed countries of Africa,
com¬
appendices.*
in
concerning
1960
modern
activity prevailed in Canada in
1960, and during the current year
to the time of writing, the period
Canadian
ments
The
Norman J.
the
of
contained
are
•
All Major Canadian
Stock Exchanges
Toronto
Calgary
Edmonton
Halifax
Hamilton
London
Montreal
Kingston
New York
Ottawa
Quebec
Vancouver
Kitchener
Winnipeg
Volume 194
Mr.
&
Mrs.
Number 6120
William
W.
Robert
.
.
,
The Commercial and Financial Chronicle
Hibberd, Trust Company of Georgia, New York;
Mathews, Trust Company of Georgia, Atlanta
C.
Continued from page 50
increases in exports of goods and
services. Business inventories in¬
but the amount involved
limited. Non-residential con¬
tries
$401
er
an
practically
was
goods and services which was
increase of 4.1% over person¬
al
&
Mrs.
Leslie
increased
million
almost
2(f%
1959
over
to
or
million.
Non
in
increased
total
net
transactions
merchandise
-
1960
of
to
$1,122
in expenditures for new
plant and
whereas
million.
equipment.
construc¬
tion
was
5%.
Figures for residential
also
struction
1961
for
off
the
approximately
second
expected
are
material
to
improvement
con¬
half
of
show
a
over
the
first half.
National Income
was
modest
when
com¬
pared with the $1,732 million in¬
crease—or
nearly 7%
in 1959.
Major changes
$753 million
were
of
income
Government
expenditures
consumer goods and services
nearly 5%. At the same time
to
in labor
$18,514 million and
non-residents)
milliion
or
a
of
million
farm
to
business
$2,105 million
lower than
income
justments
$172
of
5.9% to $2,735 million.
Unincorporated
come
after
in
in¬
$113
was
1959.
Net
inventory ad¬
improved
$70
million
$1,207 million and there
was
a
moderate
improvement
million
$2,362 million in rent,
to
interest
rose
gov¬
capital expenditures rose
by $65 million or 4.3% to $1,588
million.
All of the increase in
capital
and
spending
provin¬
cial and municipal levels as Fed¬
eral expenditures for capital ac¬
count were slightly lower.
$85
of
miscellaneous
in¬
This
Foreign Trade
$5,400 million.
by $24 million
there
that
balance
of
highlights of the Canadian
economy
inf'I960 together with
comparative figures for 1959 and
1958 are given in the following
tabulation:
Security Markets
During 1960, there
an
adverse
again in the third and easing off
in
the
final
the
United
lion
were
Exports to
quarter.
at
States
to
marked
coming
on
to the
security markets and the net bor¬
rowing from the chartered banks
for
capital purposes. The total
net
of
of
of
issues
new
all other
coun-
se¬
descriptions de¬
clined to $1,894 million as com¬
pared with $2,279 million in 1959
and the peak of $3,054 million in
1958.
The
decline
was
spread
proportionately
fairly
divisions
corporate
in
lion
across
the
the
stocks
to
1959
net
new
61
Broadway, New York 6, N. Y.
Telephone; BOwling Green 9-2895
new
very
no
doubt,
efforts
International
Canada's
in
to
there
Account
was
a
able in other Canadian currencies.
total for
The
|i
lion
in
1960
was
$102 mil¬
compared with $221 million
as
Net
issues
new
of
Canadian
securities in the first half of 1961
totaled $956
million and was rela¬
tively unchanged from the $1,060
million
riod
of
in
the
1960.
corresponding pe¬
In the
first half
With
over
ments,
year
The effects of the
heavy private
credit, particularly
credit, which had built up
demand
bank
50 years
TORONTO
Miljier
WINNtPE
MONTKEAE
9
Spence
Members
__r-
..„,i
&
^"to'stock Exchange
T^oNT0
ENG.
Century
Experience
of experience in Canadian invest¬
organization is well prepared
our
ices
are
readily available
to
serve
serv¬
investing institutions,
to
banks and dealers.
1959
for
continued
into
1960.
Direct private wire connections with affiliated offices
in
fourteen
and
principal Canadian cities provide fast
accurate
able
stock
us
to
service in Canadian
execute
exchanges,
or
at
securities, and
promptly
net prices
on
en¬
all Canadian
in United States
Wood, Gundy & Co., Inc.
40
Wall
Street, New York 5, N. Y.
Telephone Dlgby 4-0633
The
heavy sales of new
by the Federal Govern¬
ment, the sales of portfolio in¬
vestments by the banks to finance
demands for credit, heavy bond
offerings by provinces, munici¬
palities and corporations and the
orders
funds if desired.
Affiliated with
combination of
Lo*doN,
a
investors interested in Canadian securities. Our
of
net new issues payable
in
foreign currencies
only
amounted to $21 million.
in
Over Half
of Investment
1958.
this
Investment
Co., Ltd.
Japan's Leading Investment and Brokerage Firm
from $406 mil¬
$227 million in
sharp drop in net new issues pay¬
^tei wu/l;
a
issues
by the
reduce
substantial adverse bal¬
Current
buoadway
come
Nomura Securities
all
/
ance
us
we
specific security,
$243 million in 1960 as
compared with $102 million in
1959. This increase in corporate
bond issues was more than offset,
Prompted,
government's
*BC"
in. Complete information on
particular company or special
studies tailored to your needs is
yours for the asking
in a
language you will understand... Call or write.
The pleasure is all...
a
totaled
1960.
Mills, Spence & ®°*
Canadian Investment
S,a"^^T vORj£ 6, N.V.
This is where
security issues with
exception of corporate
where
bonds
Fuji, the geisha and Kabuki is
opportunity today. And
you needn't know how to speak Japanese to take ad-'
vantage of an economy that continues to grow ... and
of industries flourishing
substantially ..,
indeed the land of investment
of
main
the
True. The land of Mt.
all
$3,039 mil¬ however, by the decline in
$150 million below 1959
exports
was a
decline in the amount of both new
curities
$148 million
—a
marked
improvement from
the adverse balance of $423 mil¬
lion of 1959. The pattern of ex¬
ports during the year was irregu¬
lar being at a very high rate in
the first quarter; declining sharp¬
ly in the second, only to recover
Opportunity
The
amount
of
Land of A
lion.
declined
was
trade
of
$1,494 milloin of which non-merch ndise items were $1,071 mil¬
$5,548 million
Imports
to
balance
account
ivwgibwCO
with the
compares
current
at
was
Exports of merchandise in 1960
rose
by $251 million or 4.9% to
while
vestment income.
1959
Canadian issues
so
to
for
increase
an
4.2%
or
decline in corporation profits be¬
fore
taxes
(excluding dividends
paid
were
ernment
During 1960, National Income
rose
$699 million or 2.6% to a
total of $27,375 million.
The in¬
crease
expenditures, on
nonup about 4% and
there was a 5% rise in expendi¬
tures on services.
durables
•
million
changed from the previous quar¬
but there was a sharp decline
Residential
JAPAN
•
adverse
an
and
brought the current account ad¬
verse
balance position to $1,270
ter
Lagoni, Parker, Ford & Co., Dallas; Mr. & Mrs. Leo B. Babich, Hill Richards
Co., Los Angeles; Mrs. James R. Hendrix, Birmingham, Ala.
$2,361
expenditures in 1959. Amounts
spent on durable goods showed
very
little
change
from
1959
un¬
P.
<6
v
Consumption
was
Mr.
Mrs.
During 1960, $23,409 million was
expended by persons on consum¬
creased
struction
Mr. &
51
securities
Wood, Gundy & Company
Members
The
Toronto
yields
which
during
The
a
of
government
early part of 1960
sharp rise in bond
the
trend
reached
month
then
their
peak
of February.
changed
and
Continued
on
page
52
Stock
of
Montreal
Stock
Exchange
Exchange
and
"disinvestment"
in
Exchange
Canadian
Wood, Gundy & Company
accounts in the
resulted
Stock
Limited
Head
Office
—
36 King St., West, Toronto 1, Canada
Branches in the principal cities of Canada and in London, England
52
The Commercial and Financial Chronicle
Continued
from
51
page
Ninety-day Treasury Bills started
February,
1961
1960
they lev¬
Since that time yields
off.
have
slowly worked
the
the market.
of 1960 was
wide
swings.
During
of
basis
the
up
moderate
with
a
a
to
90-day
has" been
3.34% in April and
Industrial
1961
October,
movement
more
The Money Market
yield;
end
Bill
by
5.14%
a
during August. At the end of Oc¬
munity
tober the rate was 2.50%.
relief
much
high
of
low of 2.26%
Production
These
Industrial
of
in
times
both financial and economic Can¬
1949
Electricity
Total
&
Index
Utilities
Manufacturinq
Mininq
Gas
expected, there is a wide
diversity of views as to remedial
the
be
methods
all
which
of
ob¬
makes
jective reporting difficult.
the
of
One
167.2
247.3
151.5
269.6
166.1
247.9
150.7
260.9
Aug.
164.9
246.0
148.9
270.6
subjects in Canada in the past two
has been the respective roles
that are to be played by monetary
Sept.
168.4
26 3.
§
150.4
280.7
policies
Oct.
154.2
278.1
nomic and financial welfare of the
nation.
171.1
NOV.
167.8
264.1
149.3
285.3
Dec.
169.4
257,1
152.1,
284.9
years
prompting
in
the
eco¬
172.4
256.2
155.6
287.5
Feb.
170,4
260.6
152.6
288.9
Mar.
171.7
263.8
153.0
Apr.
166.8
251.5
149.2
293.0
Following the 12% in¬
crease in money supply in 1958 to
support the large Conversion Loan
operation
and
Federal
deficits
which produced pronounced in¬
flation fears, the money supply
May
167.3
256.4
149.0
296.0
was
June
166.9
249.6
149.0
302.1
October, 1958 and October, 1960.
This policy was in the face of a
rise of nearly 8V2% in the Fed¬
eral net debt, with increases of
similar proportions in provincial
and municipal debt plus a 9% in¬
■■))■//
Jan.
■V
,
299.6
164.0
250.8
145.7
297.8
Aug.
165.6
249.1
146.8
314.6
Sept.
167.6
255.2
148.4
314.4
Oct.
166.9
246.1
149.5
301.4
Nov.
165.9
252.2
147.7
298.9
Dec.
166.0
248.3
147.8
305.6
July
,
165.8
254.6
i
146.8
305.8
147.6
303.9
i48.i
302.5
Feb.
166.3
253.6
Mar.
165.5
242.7
Apr.
168.7
May
169.3
266.6
148.4
325.5
June
172.5
264.3
:V:152.5
323.5
uct
in the Gross National Prod¬
promoted
Dominion
Canadian
Bureau
the
merits
otherwise
nr
Statistical
Review
the
that
Canadian
Banks
remained
liquid
position
in
export
minimum
General
an
an
liquid
excess
of the
Canadian securities
and
prompt execution of orders in American
funds.
in
including latest quotations
Our Canadian affiliate maintains offices
leading Canadian cities and
a
coast-to-coast
wire service.
of
the
Broad
Street, New York 4, New York
HA 2-9251
NY 1-1979
and
17" offices
wire
across
system
Canada and
covering
all
a
direct
Canadian
private
at
the
1961
creased
These
since
end
of
in
were
1%
the
were
then
the
year
excess
of
first
in¬
was
per
month.
increases
1961, subject to
began to rise
sea¬
again. Be¬
beginning of September,
October, 1961
total
increase
approximately
nual basis
and
amounted
91/4%.
On
an
to
an¬
between
October, 1958
October, 1961 the increase in
supply has been 3%
money
The
In
Coyne
a
year.
Controversy
the
spring of 1961, a bitter
disturbing controversy de¬
veloped between the Minister of
CANADIAN INVESTMENT
and
Finance and the
SECURITIES
Bank of Canada
functions
Governor of the
as
to the relative
and
responsibilities of
the respective fiscal and
monetary
policies. This culminated in the
resignation of Mr. James E. Coyne
AFFILIATES
BELL, GOUINLOCK & CO.
LEGGAT,
BELL,
GOUINLOCK
LIMITED
LIMITED
Governor
as
Established
King Street, West
Toronto
Members
Montreal
Stock
Montreal
Exchange
of
the
Bank
of
Canada.
With
44
1961,
who
in
funds
in
Canada
which
particular the
nies" under the Income Tax Act
cir¬
special low rate of tax
Subsequent to 1956, there
regulations as to the
percentage of investments which
should be in Canada. New regula¬
United
States.
Under
the
these
qualify
enjoy
compared with a
value of goods
the
channels
of
world
entering
trade
no
a
tions
were
exports, was most disappointing
particularly so as Canada
Payments
on
Current
millions
the
Account
Balance
Imports
Exports
in
Budget
and
of
introduced
that require that corpo¬
rations
desiring to
qualify
as
"investment companies" for tax
20% rise in the U. S. merchandise
Balance
compa¬
a
were
the
and
"investment
as
of 21%.
increase in
1960^ as
10% increase in
5%
Canada's export trade in
of
Non
Current
Merchandise
Account
Jnetj
Balance
dollar?
1952
4,339
3,850
4489
-325
4-164
1953
4,152
4,210
-58
-385
-443
-432
1954
3,929
3,916
4-13
-445
1955
4,332
4,543
-211
"487
-698
1956
4,837
4,565
-728
-638
-1,366
1957
4,894
5,488
-594
-861
-1,455
1958
4,887
5,066
-179
-952
-1,131
5,572
-423
-1,071
-1,494
.5,548
-148
-1,122
-1,270
5,149
1959
5,400
'I960
Balance
of
International
a
September, 1958. During the
tween the
the
NEW YORK
trade,
the
of
is
Payments
on
and
1960 and the end of
Trinity Place
in the
actions
fluctuations, the money sup¬
ply was held relatively constant.
INCORPORATED
20,1960 to stimulate a greater
participation of Canadian capital
ownership of Canadian in¬
dustry.
Investment
funds
and
Dec.
All
sonal
74
by the government in the Sup¬
plementary or "Baby Budget" of
Invest
supply
money
close to
first half of
It
lar
Direct
In the final four months of 1960
Canada's
BELL, GOUINLOCK & COMPANY
Canada's trade
position. Of particu¬
interest were the steps taken
Canadian
$7.7 billion, an increase of nearly
$1 billion since September, 1958.
Markets
months,
12
improve
Invest
steadily and by the end of
grow
Company Limited
to
Foreign
approximately
$5
billion
again. After
holding
relatively
constant for the first quarter of
1961, general loans again began to
increase and by the end of the
third quarter they had increased
to a record high point of $5.6 bil¬
lion. Despite this, however, the
liquid asset ratio had built up to
October
W. C. Pitfield &
ated
Direct
chartered banks had continued to
An affiliate of
Investments
and financial
15%.
of
approximately 19%. It is also in¬
teresting to note that apart from
the usual
dips that occur each
year at the time of the annual of¬
fering of Canada Savings Bonds,
personal savings accounts in the
W C. PITFIELD & CO., INC.
30
on
past
determined efforts have been ini-
chartered
requirements
loans
peak of approximately $5.1 billion
August, 1959 to a low of $4.6
billion in February of 1960 had
increased
fairly steadily during
extensive investment service in all
the
other nations and in
excellent
their
with
were
We offer
During
mutual
appointment in July,
Mr.
Louis Rasminsky,
widely known and re¬
spected in International monetary
circles, to replace Mr. Coyne as
Governor, Canada's financial com¬
Capital Account
All
Trans¬
bonds
stocks
pther
Overall
Items
Balance
Abroad
in
1960
account
Canada is heavily influenced by
course of economic activity of
the
of
banks which had declined from
Securities
Policy
New Tax
no
events
economic
trade and
Chartered
an
ratio much in
asset
Canadian
her
of
of
a
policy, it should be pointed
money
Statistics
of
of
Without attempting to appraise
out
Source:
accusations
unnecessary "tight money" policy
that was hindering the Nation.
312.2
149.4
258.4
has been
held almost constant between
crease
Jan.
trend
cumstances,
controversial
most
June
259.6
there
both
current
deficit.
markets had
operate on their own
to date
Because
the
July
V
While
run
International
but without direction.
momentum
interlocking which makes the
more complicated. As is
to
100
=
continued to
of
sigh
large
a
number of months
as
situation
Seasonally Adjusted
a
government, finance, busi¬ official announcement of changes
ness
and industry seek means of in fiscal or monetary policy, it is
putting the economy back into evident that with Mr. Rasminsky's
high gear and solve such knotty appointment a new period of close
problems as adverse balances of relationships between the govern¬
payment
on
Current
Account, ment and the Bank of Canada
government
deficits,
unemploy¬ and between the bank and the
ment and the financing of our ac¬ financial community is developing.
ada,
are
Production
for
continued to
strenuous
are
tivities.) Many of these problems
Index
heaved
as
Thursday, December 28, 1961
.
.
the bond and money
New "Deals
1.68% basis in Septem¬
was a
3.25%
evident in the short end of
characterized
on
ber and they ended the year at a
their way a
little lower with this trend being
more
year
following a decline from a 6.16%
yield in August, 1959. The low for
where
elled
the
off
yields declined fairly steadily un¬
til October, 1960 when they again
began to rise. This continued until
.
millions
of
dollars
-
1952
4-346
-77
4125
-558
-164
1953
4426
-63
4158
-78
4443
1954
4-392
-81
4167
-46
4432
1955
4417
-74
-51
4406
46 98
1956
4-583
-104
47 27
4160
41,366
1957
4-514
-68
4763
4246
41,455
1958
4420
-48
4610
4149
41,131
1959
4-550
-80
4617
4407
41,494
1960
4690
-85
4218
4447
41,270
Source
:
Bank
of
Canada
1960
Annual
Report
Volume 194
Number 6120
.
.
The Commercial and Financial Chronicle
.
purposes and to
withdrawn from branches of
adian
resident
jected the
to
measures
20%
permit their Can¬
shareholders to enjoy the
tax credit
diviends must,
obtain at
least
on
the
future,
three-quarters of the
in
non¬
corporations. Exceptions
these
new
regulations were
made
in
the
case
of banks, life
transportation
and
communications companies.
insurance,
gross reve¬
in the form of dividends from
taxable Canadian
nue
corporations.
Registered
plans,
from
in
pension
Canada,
income
and
contribu¬
sources., ■]'
Both
com¬
to
the
change, and
one which is of particular interest
to U. S. investors, was an adjust¬
ment in the
"withholding tax."
The "withholding tax" exemption
on
Government
Canada bonds and the 5%
rate
provincial
on
eliminated
they
on
became
all
subject
hoped to
upward
external
value
remove
pressure
of
the
on
Cana¬
their
cial
several
worthy
are
the
on
that
announcement
Canada
tax
levy
was
imposed
of the Canadian
15%
up
Chartered
its
exchange
dollar. This
was
complete reversal of policy as
a
profits
on
operate
to the
1961 Budget the Mini-
Banks
tion
to
was
$50 million
a
the
Month
1960
End
Loans
Loans
Loans
Farmers
-
1
millions
-
-
of
dollars
-
to
Loans
Znstituations
------
—
-
the
exchange
fund
million
U. S.
of about 3%
dollar.
This
amount
of
of
the
3,101
1,041
351
167
4,659
Mar.
3,150
1,049
348
167
4,714
Apr.
3,171
1,078
361
165
4,775
370
167
4,854
S.
of
Finance
to
sible to force
and
this
in
three
the
was
4,957
174
5,043
taken
173
5,004
book values
Fund
1,165
434
178
5,022
Oct.
3,232
1,173
446
184
5,035
Nov.
3,256
1,182
441
186
5,064
over
which
420
194
5,032
191
4,962
direct
185
4,979
bonds
3,176
1,200
3,217
1,194
384
3,267
1,212
392
182
5.053
Apr.
3,316
1,246
405
178
lA: 5,145
May
3,337
1,284
418
183
5,223
June.
3,441
1,313
442
188
5,382
July
3,481
1,346
446
188
5,460
Aug.
3,547
1,371
462
188
5,568
Mar.
«
Bank
of
Canada
Statistical
Summary.
Canada
Savings
-
-
—
-
of
-
Dollars
6,536
2,433
6,225
2,541
6,045
2,649
3,521
1,258
6,073
2,895
2,811
923
7,513
3,212
3,057
866
7,485
3,594
2,524
15,165
2,463
2,641
1958
16,416
2,670
1959
17,135
2,677
17,747
2,744
1960 Jan.
17,224
Feb.
"
1,367
2,426
1960
-
1,518
2,416
15,234
4
-
1,491
3,124
16,000
,!
-
-
,,
409
7,652
3,203
876
7,808
3,174
17,310
2,908
833
7,828
3,143
gov¬
Apr.
17,296
2,651
2,875
821
7,823
3,117
pos¬
May
17,232
2,645
2,956
811
7,735
3,085
7,741
3.059
3,040
June
17,174
2,663
2,933
779
made
July
17,106
2,715
2,874
848
7,629
he
first
Aug.
17,102
Sept.
The
in¬
1
1961
2,905
900
7,556
2,676
3,061
907
7,464
17,366
2,769
3,127
950
7,518
Nov.
17,995
2,754
3,095;
985
7,527
3,633
3,002
•
3,002
Dec.
17,747
2,744
3,057
866
7,485
3,594
Jan.
17,741
2,637
3,157
882
7,471
3,594
17,730
2,584
3,275
800
7,485
3,585
7,493
3,562
Feb.
'
Mar.
mid
May
long
and
June
V
help
to
was
the
that the
the
Treasury
„
17,753
2,662
3,309
727
17,717
2,739
3,161
728
7,563
3,527
17,687
2,733
3,281
726
7,452
3,496
2,714
3,381
733
7,462
3,473
748
7,282
3,450
17,762
July
17,737
2,799
3,459
Aug.
17,885
2,803
3,645
777
7,237
3,424
Sept.
18,061
2,862
3,662
787
7,351
3,400
Source:
of
Bank
Canada
Statistical Summary.
at
acquire
interest
-marketable bonds
to be redeemed by the
of
Canada
the Fund
by
The
required.
as
Government
held
would
about $245
to
these
have
steps
the
will
desired
con¬
effect
L. G. BEAUBIEN «• C?.
LIMITED
UNDERWRITERS AND DEALERS
forcing down interest rates is
Government, Municipal, Corporation,
School and Religious Institution Bonds.
221
NOTRE
DAME
STREET, WEST
MONTREAL 1
Quebec —Trois Rivi&res—St-Hy acinthe—Shawinigan—Ottawa
Sherbrooke—Chicoutimi—Sorel—Paris—Brussels—Geneva
Underwriters
Canadian Securities
Distributors
Government of Canada Bonds
Provincial and
Inquiries welcomed from institutional
Dealers
Treasury Bills
Municipal Debentures
Corporate Bonds and Shares
investors and dealers
Prime Acceptance and Commercial Paper
Greenshields & Co (N.Y.) Inc
64 Wall Street,
>
Telephone: WHitehall 3-9525
EQUITABLE SECURITIES CANADA LIMITED
Member
New York 5
Teletype: NY 1-3708
of The Investment Dealers* Association of Canada
EQUITABLE BROKERS LIMITED
;
Member
Canadian Affiliate:
MONTREAL
TORONTO
of The Toronto Stock Exchange
Greenshields Incorporated—Business established 1910
QUEBEC.
OTTAWA
WINNIPEG
SHERBROOKE
1
Head Office
60 Yonge
LONDON
MONTREAL
U. S.
Direct
•
Street, Toronto, Canada
HAMILTON
•
KITCHENER
Subsidiary: Equisec Canada Inc.
private wire with Goldman, Sachs & Co., New
York
;
3,017
2,723
17,110
Oct.
and in exchange, the
non
are
Whether
of
V
1955
1957
initial size of
an
step
i.
Source:
Public
2,926
million mid and
long term bonds that have been
overhanging the market.
tinue
Issues
2,920
then be cancelled. This would re¬
move
Market
Accounts
would
bearing
1,199
Govt.
Banks
2,598
Secondly, the gov¬
setting up a pur¬
by
Chartered
2,544
entire portfolio of the Unemploy¬
ment Insurance Fund would be
168
Outstanding
Canada
the "short end"
Canada bond market
386
Direct
2,535
government
Canada
third
The
Bank
54
Securities
1956
Apr.
buy
of
Total
page
14,321
issues to
396
3,245
on
Mar.
several
1,141
Sept.
entire
Continued
Canada
a
to < examine
financial
struc-
of
Period
was
Federal
1,135
Feb.
it
at
least for the
next
months, to confine new
tended,
1,109
Jan.
End
down interest rates
announcements.
that
was
said
connection
3,332
1,151
Canada's
of
Guaranteed
the
appointing
was
commission
al¬
are
interest
that
Policy
policy of the
do
everything
3,267
3,259
government
royal
passing
announcement
ppn^s
keep
During the Budget speech, the
3,208
Aug.
than
more
the
General
holdings
to $2,111
fund
Low Interest Rate
government
1961
and
million.
July
421
banks
chartered
Distribution
discount
a
dollar
exchange
May
395
the
against the American
brought
the
total
U.
June
3,220
dollars to
term securities.
4,674
Of
was
buy
to
168
Dec.
to
Loans
369
'
had
$100 million which would be used
1,044
Feb.
of
demand.
■' Royal Commission Appointed
increasing de¬
viously mentioned, general loans
October, however, the
picture changed considerably and
General
3,093
Jan.
the
private enter¬
prise particularly « on the char¬
tered banks as Canadian industry
gets back into high gear. As pre¬
Total
to-
the
of
load might well
new
with
In
chase fund with
Personal
coincide
end"
"short
that
payment
Monetary
International
Fund.
ernment
Loans
Business
high.
very
reduction of $61 million in the
exchange
fund
hard
currency
holdings. Included in this reduc¬
of the market.
General
of
Claasification
the
the
on
at record levels although
is no evidence at present
they are selling off bonds
and treasury bills in size to satisfy
there
a
ernment
lower the external value
a
by
of September, following the
Budget Speech, there was actually
the determined
fund to
15% and
likelihood
in¬
dividends paid by
parent corporations
exchange fund would
Minister
to
increased to
all
dollar by
Between the end of June and the
in¬
tended
non-resident
the
the
withholding tax on interest. The
special 5% withholding tax on
was
in
finan¬
Of particular
non-residents, was
to
load
note because
of
influence
policies
markets.
terest
subsidiaries to
of
Canadian
187
of
oc¬
ready
mand for credit by
the
on
the Canadian dollar at
an¬
one
questioned by many finan¬
cial men. The government 'will
require in the order of $1 billion
of new money which is a heavy
mium
dian
of
15%
than
more
the
that
was
a
was
nouncement
of
bonds and
to
the
Nevertheless it contained the
special
issues
new
of
were
dollar that was impairing
competitive position
of
Canadian producers.
The June 1961 Budget was es¬
sentially
domestic
in
nature.
major
interest
Canadian
and
time it
some
complete the required adjust¬
ments in their portfolios.
of
foreign in¬
promote
to
capital
merely the
withdrawal of special incentives,
that are no longer required, to
attract
foreign
capital.
At the
same
second
of
use
Canada
panies
and
pension
plans
are
given until the end of March 1963
A
rather
the Minister of Fi¬
no
still
market. This
end
to block out
but
had
flatly re¬
adoption of any such
by
the
government.
casion expressed the opinion that
the cost of eliminating the pre¬
intended
greater
Canadian
investment
Capital
Finance
had
nance
use
in
future derive 90% of their invest¬
from
Foreign
of
During 1960,
introducing
these
changes, the Minister of Finance
emphasized that they were not
vestors
order to continue to
enjoy these
privileges, pension plans must in
revenue
at
When
tions to the plans in almost
every
case
are
deductible from income.
The
Budget
provided
that
in
ment
Aimed
or
exempt
are
tax
Not
funds
ster
53
;
54
F.
The Commercial and Financial Chronicle
Barton
Harvey, Jr., Alex. Brown <fi Sons, Baltimore; Avery
Rockefeller, Jr., Dominick & Dominick, New York;
B. Lemkau, Morgan Stanley & Co., New York
Mr.
&
Mr.
&
Mrs. William W. Pevear, Irving Trust Company, New
A. Stoddard, Morgan Guaranty Trust
-v'.,i
,
Continued from page 53
propriating
ture and institutions. The Honor¬
Electric
able
British
and
certain
York;
Company,
Mrs. Donald
Hudson
New
tion
Columbia
other
Porter, Chief Justice
has been appointed
parent company, British
Columbia Power Corp.
Limited,
to date of
Chairman of the Commission. The
at
in this
of
Ontario,
terms
of
reference
broad and facilitate
brief
are
but
study of all
aspects of money, banking, credit
and finance.
The timing is ap¬
a
propriate as the Bank Act comes
up
for its decennial review in
1964 and the last major financial
study
was
by
the
MacMillan
Commission
in
1938.
To United States citizens whose
rights
as
property owners
are
protected by the U. S. Constitu¬
tion, the action of the British
Columbia
Government
in
ex-
the
arbitrary price, set without
an
independent
appraisal
and
without the right of appeal to the
courts
must
shocking
Canada.
The
President
Dealers'
The
both
Canada
similar
and
against
the
not
took
bring
a
British
asked
the
Supreme
Court
Columbia
Government
G.
its
reviewed
in
under
Constitution
America
must
B.
courts.
the
(The
Act) the
seek
C.
the
.
be
Unfor¬
North
injured
party
the
permission
Government
tric.
British
the
in
its
did
Columbia
court
not
legal powers, B.
Elec¬
that
rules
Provincial Government
was
the
with¬
C. Power
then asks that the Supreme Court
from
to
If
that the
rule
to expropriate
wholly owned sub¬
former
sidiary,
Canadian
British
legal
to
set
proceed
against the Crown. The Corpora¬
price
a
as
"full compensation"
for B. C. Electric.
some minor
been obtained
have
the
B.
C.
Ashplant, Vice-Chm.
entry into
Economic
Com¬
Common Market has
or
Opinions
for
prospects
One
school
members
of
prominent,
dian
future
of
thought
the
trade
would
that
are
external
school
POSSIBLE
OF CAPITAL
INC.
own
Britain
for
that
argues
to
PIONEER
YOUR
:
INVESTMENT
OR
DEALER
AND
INCOME
423 Texas National Bank
little
Greenshields Incorporated
Montreal, Canada
Gerard Gingras
Rene T.
Leclerc,
Incorporee
Montreal, Canada
1962.
The
Dominion
Peter Kilburn
Greenshields Incorporated
Montreal, Canada
Bureau
of Statistics Industrial Production
in
Bldg.
goods
August
level
of
advanced
175.1.
production
has
to
a
George C. MacDonald
Durable
shown
McLeod, Young, Weir, Inc.
York, N. Y.
time
ada
in
a
will
number
have
of years,
surplus
a
merchandise
trade.
rising
corporation
and
The
New
an
uninterrupted rise since January.
It now looks as if, for the first
Arnold B. Massey
Mills, Spence & Co., Ltd.
Toronto, Canada
Can¬
in
her
GNP
Johnston
Wood, Gundy & Co., Inc.
New York, N. Y.
now
is ex¬
periencing a moderately healthy
upturn which should carry well
into
Co., Inc.
York, N. Y.
'
Edward S.
question
Curry
Dudley Dawson
that the Canadian economy
record
Houston 2, Texas
FUND
New
and
Conclusion
is
G.
A. E. Ames &
...
TEXAS FUND MANAGEMENT CO.
I
Andrew
it
seek
salvation
economic
THE
GROWTH
request from
on
Nesbitt, Thomson & Co., Ltd.
Toronto, Canada
be
thought
necsesary
Index
Prospectus and Literature
J. Ian Crookston
PRIMARILY
Soudwtt
FOR
Bell, Gouinlock & Co., Ltd.
Toronto, Canada
tariff
of
>
Vice-Chm.
Montreal, Canada
arrangements
of
Common Market.
The other
the
S. Beaubien,
Irving H. Campbell, Sec.-Treas.
Cana¬
damaged if
it is necessary to work under the
Ashplant & Co.
York, N. Y.
L. G. Beaubien & Co., Ltd.
expansion.
in which
government
contends
B.
Andrew
divided as
to what effect this step will have
upon Canada's existing trade and
There
1hz91
F.
New
sharply
are
ally strong and Europe politically
strong.
OF
George P. Rutherford
is
profits
The
Dominion
Securities
New York, N. Y.
INC.
CONNECTICUT COVERAGE
Over 50 years of
Investment Banking and
Prospectus
from
your
upon request
or
•
Brokerage
in Connecticut
investment dealer
selected
•
american shares
from:
PUTNAM & CO.
Member
of the New York Stock Exchange
...
6 Central
FUND
RESEARCH
MANAGEMENT,
AND
INC.
1000
Farmington Ave.
NEW YORK
5, N. Y.
Branch Office
Central Ave.
24
Waterbury
investment
Branch Office
Branch Office
31 West Main St.
245 Main St.
18 Broad St.
New Britain
Middletown
New London
Branch Office
30 Mason
St.
Branch Office
Branch Office
69 Church St.
Manchester
Wires and
Willimantic
teletypes
REPRESENTATIVES
to
principal cities
THROUGHOUT
THE
STATE
portfolio
securities
sibility
71 East Center St.
Torrington
which supervises
sified
Branch Office
West Hartford
67 WALL STREET
mutual
com¬
Prospectus
pany
From New York City—WAlker 5-7887
Branch Office
a
Row, Hartford 4, Conn.
Telephone JAckson 5-1421
at
Respectfully submitted,
proposed
special significance to Canada as
a member of the Commonwealth.
is
SECURITIES
has decreased
than seasonal rates.
more
European
Canada in the long run will bene¬
fit more with Britain economic¬
IN
unemployment
C.
to
were
begininng to improve and
the
increased
production
their
Britain's
its
INVESTING
are
with
Government.
B.
Orleans
holdings par for
CANADIAN COMMITTEE
par into perpetual bonds with the
same coupon rate. They are now
Norman J. Alexander, Chairman
able to take 25 year bonds or
James Richardson & Sons
convert the perpetual bonds into
Winnipeg, Canada
25 year bonds.
Frederick B.
munity
to
power
tunately,
meantime,
Originally, holders of the
trying
Provincial
not
from
the
have
could
a
the case before
surprise move on
Nov. 13, 1961, B. C. Power Corp.
actual
Government
the
of this report. No efforts
being spared by the B. C.
Power
Corporation
lawyers
in
expropriation
but at the arbitrary price which
without express permission of the
C.
the
is beyond the
same
the courts. In
much
so
of
of
considerable and
are
are
a
elsewhere
action
In
concessions
Electric preferred shares
_
Courts
scope
strongly
worded message of condemnation.
Other competent bodies both in
Canada
in the
legal ramifications
discussion
Association
dispatched
.
Attacked
csituation
the
of
Carter, Jr., Courts <fi Co., Atlanta; Mr. & Mrs. Paul T.
Westervelt, Howard, Weil, Labouisse, Friedrichs and Company,
exchange
incomprehensible.
was widely deplored
Investment
of
been
decision
no
respect.
Legality
and
The action
in
have
writing the B. C. Gov¬
ernment has anounced
an
Thursday, December 28, 196-1
New
"petition of rights" but
a
of
Dana
.
.
Hugh
York
behalf of its shareholders
on
has filed
assets
.
selected
of
long
of
term
on
request
diver¬
American
for
growth and income.
a
the
pos¬
capital
SELECTED
Investments
Company
135 South La Salle Street
Chicago 3, 111.
Corp.
Volume
194
Number 6120
.
.
The Commercial and Financial Chronicle
.
Report of IBA Investment
Companies Committee
Herbert
R.
Anderson, President of Distributors
Group, Incorporated, New York City, was this
year's Chairman of the Investment Companies
Committee and, in that capacity
informed the Con¬
vention as follows:;
Total
sales
1961
of
mutual
funds
in
apparently will be in the
of $2%
to $3 billion, a
range
level
20%
or
above
more
the
previous peak
year.
While
the
of
less
or
ap¬
$21 billion in¬
vestment
dustry appar¬
ently will ex¬
ceed $1 billion
within
the
for
sales
dividual
this
years
ago,
only
mutual
the total
funds
ten
and we need go back
1949 for the time when
to
total assets
this
(
about equal to
all
were
greater than
no
year's net sales.
In terms of
now
are
close
to
5V2 million held by an estimated
2% million individual investment
These
in
bers
large
are
absolute
num¬
Their
terms.
relative importance may be
plainer
that
of
it
when
made
pointed out
is
than 20% of all holders
more
corporate securities
mutual
the
of
and
funds,
total
hold
with
at
no
own
some
least
other
10%
cor¬
cussion
of
general dis¬
development
some
this
would be of interest to the entire
IBA
membership.
new
through three stages.
Initially they are often thought
to be "offbeat," ridiculous or dis¬
turbing. After a time, if they are
sound, they become tolerated and
subsequently they are accepted as
pass
self-evident truths.
To
the
three
range
in
even
is
true, the
rarely
be
would
reached by all people at the same
time,
so
with
there doubtless
attitude
each
development
new
today
of
trouble
seems
those
are
toward
at
strategic
income,
and then,
the
of
area
is
a
tactics
"risk
further
through
objectives
similar
But, regardless of this (whole¬
we
believe)
diversity of
form and substance, there are at¬
tributes
and
developments gen¬
erally considered common to all
it
—and
lieve
appears
of
case
these
is
which
underlie the
earlier
be¬
we
transition that
to be taking place in the
mutual
funds
consideration
security"
to
from
as
their
"another
their
becoming
a
widely accepted consumer service.
during
generally
I
is
often
fixed
dollar
any
a
more
(Since 1915, deposits in mutual
savings
have
banks
increased
from $3.9
billion to $36.3 billion,
investments in savings and loan
from
$1.48 billion to
$71.4 billion and total assets of
life
insurance
companies
from
$5.2 billion to $119.6 billion, per¬
centage gains of 831, 4,724 and
2,204.)
The
lack
Meanwhile,
any
in
prob¬
somewhat
world
before going
investment
startlingly
longer period
than
the
growth of investment
companies in more recent years.
over
the
a
with
advancing
the
saving and in¬
the cause, per¬
commitments
given
in
World
credited
stimulating
and
public's interest in
vesting. Whatever
sonal savings and
any
to stem from
of definition so,
funds
be sought.
Fixed
lot
Using
military
some,
time.
A
others.
stability
the
associations
this
extent
stages
all
ably have grown
It has been said that most
ideas
within any in¬
brokerage office
there
which
War
broadening
of investment company shares
that
an¬
of the in¬
one
gradations of
as
between
tolerance,"
public
Forces
continuously
suggests
to
no
The sale of liberty bonds to the
Underlying
use
all
growth and
touching on
porate security.
The
or
as
objectives
may
people, total share¬
holder accounts
accounts.
broad
commonly understood
terms, there are mutual
Herbert R. Anderson
gross
of
policies.
this
similar
accounts
same
operated
defined
any
the
way
are
is
new
assets
and
necessarily
other than
perspec¬
tive,
year's
no
mutual fund is
one
vestment firm
high. By
is may
commingled
within
sub¬
stantial
of
than
more
will
a
a
result
definition,
first
1961
record
than
clearly
Other
time, net sales
in
mutual fund
or
be in order. A mutual fund is
acquire
or
dispose
of
on
an
agreed-upon basis, that is aimed
at
a
particular—and stated—in¬
proximately^
substantial
value
know
(2)
creased.
mental
Dollar
facts
Investments
erosion
in
the
equity investment, and frankness
would require it to be said that
population
has
in¬
more
important fi¬
nancial fact is that, coincidental
with
the
nation's
growth
of
population, the national income
has become much more broadly
spread. In other words, we not
only have a lot more people but
a higher proportion who are able
those
to
the
of
most
saved
dollar
and
impressive
long
growth
in
price of
common
the
a
term
-
dividends
and
stocks. In other
offering fixed dollar forms
investment to the public gen¬
of
investment account, made easy to
redemptions
from
words, the public has had two
strong forces driving them toward
further, a simple restatement of
just what an open-end investment
more
Let's examine this development
another viewpoint. We all
portance
have
also
occurred—
(1) a distressingly constant and
on
our
The
1957,
defensive to that extent.
such
years ending in
the latest date for which
figures are available, we
(The so-called
"variable
an¬
nuity" is one reflection of this.
find,
first,
The
have
been
placed
consideration
banks
in New
possibility
by
York
of
on
(Taking the 10
of
"consumer
units"
increased
by
nearly 20%, from 44.7 million to
savings
State
of
funds
to the
trust
common
earned less and 63% earned more.
If the break is made at
$6,000,
the
percentage earning above that
figure increased during these 10
years from 17%
to 38%, a gain
activity and insure that
trust
common
stricted to
its
fiduciary
fund
is
re¬
with bona fide
use
accounts,
as
of
in¬
was
tended.)
not
are
cance
the
only
to share in the owner¬
ship of common stocks. However,
they
do
provide
many
con¬
of
63%
The
the
as
of
market"
as
about
35%
listed
measured
little
by
the
was
its
above
Index
of
of 23%. Taking all stocks
the
we
New
York
Stock
find that 43%
their
some
even
individual
are
1955-57
highs,
by substantial amounts. And
more
startling,
third of all the stocks
York
Exchange,
still below
Stock
about
on
the New
Exchange that
listed then and
now
are
one-
adding
growth in
use
long as people see
hope of accumulating
of
Investment Company Institute
Mention should be made in this
report
of
the
recent
change
whereby the National Association
of Investment
Companies has be¬
Company In¬
the Investment
stitute. Organized 20 years ago as
an Association of
issuers, or oper¬
ating
companies,
this
change
broadens the base of
membership
to
include
investment
advisers
and
underwriters of investment
companies. While still a voluntary
Association, the new Investment
Company Institute is believed to
be
in
position
a
to
more
effec¬
tively represent all phases of the
industry. >
In
and
view
still
the
public
funds,
the
of
substantial size
accelerating
it
growth
further margin of
often to become
possible of achieve¬
about
doing something
it.
In
short, we believe that the
increasingly effective sales efforts
in the sale of mutual fund shares
are
the
result
fundamental
of
these relatively
and
factors,
forces
somewhat continuous
inquiry
should be made into their struc¬
ture
and
operation.
checks-ups
are
A
examination
similar
business, that
and
remove
good
for
Physical
people.
of
any
discern, isolate
possible weaknesses,
can
should add to its strength.
Constructive Analysis
Welcomed
Today's
of
investment
course,
have
companies,
to their
present stature and public accept¬
grown
under carefully drawn stat¬
utes that regulate their
operation
and prescribe disclosure standards
that are unique in
ance
today's business
world.
Significantly, these statues
—and
particularly The Investment
Company Act of 1940—represent
the
cooperative effort of the au¬
thorities and those in the business.
To the extent current
inquiries
examine the effectiveness
seek to
of these
statutes, and whether imContinued
on
page
FUNDAMENTAL
INVESTORS,
Investing in
common
ik
stocks
selected for possibilities of growth
in income and capital
over
the years.
rather than being the cause of the
industry's growing importance.
From
national
the
spread
contribute
curities
standpoint
interest, the
ownership of
to
which
so
of
more
is
our
wide¬
equity
mutual
much
se¬
funds
certainly
DIVERSIFIED
INVESTMENT FUND, K
BULLOCK
FUND
A balanced investment
in bonds, preferred stocks and
common
CANADIAN
stocks.
FUND
GROUP SECURITIES, INC.
ESTABLISHED
1933
k.SELECTIVE
7
DIVIDEND SHARES
NATION-WIDE
SECURITIES
DIVERSIFIED GROWTH
STOCK FUND, *
Investing for long term growth
[possibilities in securities of companies!
in many fields of scientific and
economic
National Sponsor and
80 Pine
development.
Investment Advisor:
CALVIN
Distributors
Group, Incorporated
BULLOCK, LTD.
ESTABLISHED
1894
Hugh W. Long and Company
Street, New York 5, N. Y.
ONE
WALL
STREET
in
acceptance of mutual
is not surprising that
some
other funda¬
far-reaching im¬
capital formation
nothing, but
Defensive
two
of
of
increased.
appears
third
persent level.)
Security, and
As
no
ing below their 1946 highs when
the Dow high was less than oneits
Social
is
to
reason
conscious of retirement
sufficiently
were
still sell¬
is
ment to warrant
in¬
on
or
comfort
dividual '55-'57 highs by an aver¬
age
that
probably
there
base
as
a
base
is
provided through
these other media, the possibility
1955-57
their
below
were
1947,
point
cant they tend to do
highs. Yet 15 of the 30 stocks in
this
is
whole
sufficient amount to be signifi¬
a
we
Index
1957 than in
substantial
planning.
date that "the
Industrial
but
come more
the
on
Exchange,
recent
a
Dow-Jones
are
and
employee retirement plans gen¬
erally, has caused people to be¬
of
investors, sensed or bunderstood, in actually achieving this
result
through individual stock
selection. For example, using only
find
next
believe
(That this is important is sug¬
gested by some rather interesting
figures that indicate the problem
Stock
less
compared with 26%.)
as
arguable
York
earned
The
enterprise
system —
capitalism"—is thereby
"people's
earned
more.
i.e., 38%
un¬
derlying the industry's continued
New
37%
than $6,000 in
may
growth.
those stocks that
units"
$4,000 in 1947, and 51%
as
compared with
Using the $6,000 break
point, there was an increase of
nearly 50% in those earning more
pation in the kind of investment
this
these
more
when
1957
greatest possible as¬
of the investor's partici¬
seeks—and
"consumer
earned
the
he
all
less than
selective diversification they pro¬
vide within a stated field probably
results
signifi¬
to
adjusted
change in living costs. In
other words, on the basis of dol¬
lars of constant (1957) value, 49%
They
do
tend
to
eliminate the problems of "choice
and
change."
In
addition,
the
well be the fundamental fact
be attached
when they are
for the
veniences.
surance
greater
even
may
figures
sound way
offers
120%.
Possibly
Mutual funds
free
broadened while
and 37%
System is considering an amend¬
ment
to
its
Regulation "F" to
the
number
1947, 63% earned less than $4,000,
earned more, whereas of
the greater number in 1957, 37%
public generally. In
the latter case, the Board of Gov¬
ernors
of
the
Federal
Reserve
curb this
the
million—more people earn¬
ing. We then find that the pro¬
portion earning more or less than
$4,000 was exactly reversed over
the 10 years. In other words, in
offering
a
mutual fund to depositors is an¬
other, as is the tendency by some
banks to offer their
that
53.7
the
their
constructive.
the
come
invest.
the
erally
company
55
Incorporated
Westminster at Parker
»
Elizabeth, New Jersey
56
56
Investment
The Commercial and Financial
Companies
Committee,
Breakfast Meeting—Herbert
R.
Incorporated, New York, Chairman
Continued from page 55
proved.
provements in the basic operation
business.
And
that
is
Anderson,
Distributors
Withdrawal
of investment
close
companies can and
should be made, they are gener¬
ally welcomed. Those in the busi¬
ness
have
the
same
Significant
More
of
extent, however, that these
inquiries simply challenge or seek
to deny the profit
that should
accrue
to
successful
a
mutual
larly adding
to
their
through
the
enterprise, they strike at the basic
dividend
reinvestment
motivation
fered
services
through
and
the American
tive market
which
the
products
offered
public in
a
to
competi¬
continuously
are
im¬
by
45%
30,000,
number
now
represented
by
present value of
million.
a
now
plans
but not to relate these to the
and
vehicle
company
the needs and
en¬
vironment within which they have
been achieved would omit a quite
of¬
For
example, in 1940, when the
assets
to
of
L.
mutual
funds
than
$500 million,
sues
amounted
Morgan
Andrew G. C. Sage II
Wellington
Co., Inc.
Philadelphia, Pa.
Robert
L.
Lehman Brothers
New
were
York, N. Y.
Henry J. Simonson, Jr.
National Securities & Research
Osgood
Vance, Sanders & Co., Inc.
Corp.
Harry I. Prankard, 2nd
*
Werly
Putnam Fund
Distributors, Inc.
Boston, Mass.
Albert C. Purkiss
Carlton
&
P.
Wilson
Robert W. Baird &
Co., Inc.
New York, N. Y.
Co., Inc.
Milwaukee, Wis.
less
their holdings
of New York Exchange listed is¬
objectives of people,
to
estimated
an
three-quarters of 1% of the total
value
of
all
such
listed
issues.
Today, with fund assets increased
more
is
than
still
40
less
times,
than
this
4^%
figure
and,
of
course, they hold a substantially
lesser percentage of issues traded
in other markets.
As for their market
Brokers
and
Dealers
influence,
the
net
at
estimated
an
1 % of total
were
of
on
of
the
New York Stock Exchange. How¬
Investment Securities
ever,
today the figure is still
more
than
an
estimated
The Chase Fund
Trust of Boston
small,
one-quarter
trading volume
Shareholders'
or
purchases
mutual funds in 1940
m
activity
no
2.5%
of
this year's trading volume.
Your committee appreciates the
opportunity to present this report
and hopes it has been of
interest.
of Boston
A balanced investment
program
for
current
A
intome and the possible
diversified
program
growth of capital
investment
seeking capital
appreciation possibilities.
and income.
Inquiries invited from Dealers and Financial Institutions
Prospectuses
CHASE
Respectfully submitted,
may
be obtained from
DISTRIBUTORS
CORPORATION
'
INVESTMENT
COMPANIES
COMMITTEE
75 Federal Street
•
Boston 10, Massachusetts
Herbert R. Anderson, Chairman
Distributors Group, Inc.
James Anthony & Co.
New York, N. Y.
George D. Aldrich
The Parker Corporation
Boston, Mass.
INCORPORATED
Hunter Breckenridge
McCourtney-Breckenridge
&
St.
Co.
Louis, Mo.
Robert E.
The
Clark
Calvin
Bullock, Ltd.
New York, N. Y.
Qeorge
PUTNAM FUND
Howard B. Dean
of 'Boston
Harris, Upham & Co.
New York, N. Y.
Complete Trading Facilities
"A BALANCED FUND"
Henry Earle
"
First
of
Michigan Corp.
Detroit, Mich.
Active Markets in Unlisted Securities
Charles F, Eaton, Jr.
Eaton & Howard,
Inc.
Boston, Mass.
37 Wall Street
BOwling Green 9-4290
New York 5, N. Y.
Teletype N Y 1
-
4541
Hugh W. Long
Hugh W. Long & Co., Inc.
Elizabeth, N. J.
THE
PUTNAM
Distributors, Inc.
Boston, Mass.
Emphasizing possible long-term Capital Growth
Prospectuses
Bache
New
&
Co.
York, N. Y.
on
Request
Putnam Fund Distributors, Ind
60
George Meyer
GROWTH
FUND
Philip F. McLellan
Massachusetts Life Fund
New York
'
York, N. Y.
Charles M.
Lord, Abbett & Co.
New York, N. Y.
Walston
material fact.
companies.
Walter
New
report has mentioned the
size and growth of mutual funds,
investment
Thursday, December 28, 1961
Boston, Mass.
Size
on
This
regu¬
accumulation
investment
Perspective
of
Illustrating the adaptability of the
investment
Plans
accounts with
about $500
.
.
Powell Davis, Investment Corporation of
Virginia, Norfolk, Va.; C. Wiley Grandy, Investment
Corporation of Virginia, Norfolk, Va.; Mr. & Mrs. Glenn Miller, Cruttenden, Podesta & Co., Chicago
shareholder accounts
funds—about
the total number—are
business
Services
than two-and-a-half mil¬
lion present
To
purpose.
the
Special
to
.
G.
Group
the relatively new Remittance or
everybody's
Chronicle
CONGRESS STREET, BOSTON
Chicago
Los
Angeles
Atlanta
.
Volume
194
Number
6120
.
.
The Commercial and Financial Chronicle
.
57
Extension
(2)
Report of IBA Small
Business Committee
(3)
Keyfax
stantive
year
your
quently, he made available to
com¬
mittee has continued to watch de¬
velopments, legislative and other¬
wise, affecting small business gen¬
erally but has
devoted
us
number of charts which he used
a
in
with
connection
tion and
his
presenta¬
made these available
we
to members of the committee and
most
others who
interested.
were
of its attention
Small
Business In-
This open
I
the
nve s
tment
Company
ing
being
gram
cided
administered
the
by
successful that
so
to
we
de¬
duplicate it at the Con¬
liberalizing legis¬
lation
Ad¬
has
been
enacted
in
the
ministration
interim and, of course, there have
been other developments in the
under the law
program.
authorizin g
such invest¬
ful
ment
Again, we were success¬
securing Mr. Phil David
Fine, Deputy Administrator of the
Small Business
compa¬
nies
in
which
Harvey B. Gram, Jr.
address
an
open
Administration, to
meeting on "Small
passed by
the Congress in 1958. Because of
the
widespread interest in this
new financing
tool, the public of¬
Business Financing" as your Con¬
ferings of stock of SBIC's, and
legislation pending before the
Congress to change the 1958 Act,
we
held an open meeting of our
committee at the Spring meeting
of Mr. Fine's formal remarks
to this report. [Ed.
Note: We reproduce elsewhere in
was
the
of
Board
of
Governors
vention
program
indicates.
benefit
of those
who
the
unable
to
this
attend
this
issue
talk
at the
text
the
of
Mr.
tion
participate in the consideration
subject. We were fortunate
in being able to get Mr. Phil David
Fine, Deputy Administrator of the
Small
Business
Administration,
and who is in charge of the SBIC
program, to address the meeting.
At that time he gave an admirable
summary of
the background of
this program, a report on its prog¬
of this
ress
generally
data
talk there
tion
and
basic
effective.
was
an
answer
law
and
53
this
area.
W.
For
Jackson
Blvd.,
the
his
Chicago 4,
This Service is what its
implies and contains
make
Following
in
(1) The SBIC Evaluation Serv¬
ice which is published monthly
by S. M. Rubel and Associates,
eralize
the
re¬
matters, we list, without neces¬
sarily endorsing, the following:
111.
more
other
and
benefit of those interested in such
some
detail the legislation then
pending before the Congress which
was in large part designed to lib¬
it
services
to
as
ports available which provide data
on and analyses of small business
investment companies and reports
to that date and discussed in
the
book
on
mium,
price index,
value, price pre¬
average
portfolio
yield,
extended ques¬
percentage of funds invested, total
period. 'Subse¬
funds invested, etc.
President,
printed in the Appendix of the
session, 87th Congress.
There being no objection,
address
call
in the
attention to
your
of
in
these
the
a compen¬
which was
items
Congressional
Record
by Senator Sparkman on Sept. 27,
1961, a copy of which is attached
to this report as Appendix I.
Your committee wishes
particu¬
larly to
its thanks to Mr.
express
Fine for his cooperation and
help¬
Record,
Year
after
for
concern
of
decade
has
membership
mittee
can
to how the
as
be
more
the
com¬
helpful and
area.
Respectfully submitted,
foster
Johnston, Lemon & Co.
Washington, D. C.
Leo B. Babich
the
and
Congress in the past
adjourned without
the legislative arsenal
adding to
of small business new
weapons
help the Nation's small
to
and inde¬
pendent
enterprisers wage their
oftentimes desperate struggle for
survival on today's business bat¬
tleground.
bankruptcies, the 1st session
of the 87th
Congress agaiin dem¬
onstrated
its
problems
of
awareness
small
of
the
businessmen
through the enactment of various
Hill Richards &
measures
Co., Inc.
Angeles, Calif.
&
to
strengthen the small
I
Co.
Providence, R. I.
cannot
let
the
occasion
pass
without taking notice of the
com¬
larger and more
In no slight
these efforts of the com¬
were responsible
of significant
business legislation during
measure,
for
the
enactment
the first session of the 87th Con¬
When Congress passed
it
in
the Small
1958,
significant
Investment Act of
effect
added
dimension
new
a
to
the
Nation's
banking system by creating a
primary source of credit in
companies. The
investing public
of
response
to
the
idea
are in existence 386
investment companies licensed by
Small Business Administra¬
tion.
These have
tal in
excess
able
for
aggregate capi¬
of $300 million avail¬
long-term
loans
and
equity capital for small busi¬
enterprises. Even so, as with
all new and original
concepts, it
ness
became
evident
that
opportuni¬
ties existed for improving and ex¬
panding the SBIC program, chiefly
by means of making the forma¬
tion of
the
SBIC's
attractive to
more
investing public.
New Incentives Provided
With this
gress
as
an
objective, Con¬
passed
S-902-Public
Law
Continued on page 58
Pittsburgh, Pa.
Wertheim & Co.
York, N. Y.
.
Gerald P.
:
'
i;
Peters
Peters, Writer & Christensen,
Inc.
Denver, Colo.
Leo L. Quist
Harold E. Wood
St.
Massachusetts
Co.
Paul, Minn.
Craig Severance
F.
Eberstadt & Co.
New
Life
&
York, N. Y.
Wickliffe
Shreve
Hayden, Stone & Co.
New York, N. Y.
Fund
APPENDIX
I
The Small Business
MASSACHUSETTS LIFE
DISTRIBUTORS
FUND
tive
1st
50
Street
State
Legisla¬
Accomplishments of the
Session, 87th Congress.
Boston
Wellington
A Name to Remember
When Investing
Mutual Investment Funds
WELLINGTON
#
•
Bond Series
Balanced Series
—
•
Preferred Stock Series
• Income
Series
a
Balanced
I
Stock Series
capital, reasonable cur¬
income, and profit
possibilities.
Eilablished 1930
120
Broadway, New York 5, N. Y.
Stock Fund—write for
e»
a
free
EATON & HOWARD, INCORPORATED
24 Federal Street. Boston 10, Mass.
investment dealer
Gentlemen:
for prospectus or write to
Information Folder and Prospectus on Request
NATIONAL SECURITIES & RESEARCH CORPORATION
Founded 1931. Investigate
& Howard's diversified;
Eaton
prospectus, today! Address your
Investment Dealer, or—
Dividend Series
Growth Stocks Series
professionally managed mutual
fund investing primarily in
common stocks for possible growth
of both principal and income.
seeking conservation of
Ask your
%
professionally
managed mutual fund investing
in common and preferred stocks
and bonds. Objectives: current
income and possible future growth.
Fund
rent
#
A
A
Established in 1932. Write your
Investment Dealer or—
FUND
NAME-
Wellington Company, Inc.
STREET.
Philadelphia 3, Pa.
CITY.
please
send
me
your
of
Today there
John S. Hilson
Bear, Stearns & Co.
New York, N. Y,
the
the
A. E. Masten & Co.
New
the
small business investment compa¬
nies has
exceeded
expectations.
Aims C. Coney
V. Theodore Low
new
form of small business investment
business segment of our
economy.
In summarizing these at
this(time,
Gordon E. Cadwgan
Walker
of
promote a healthy
business
community.
No
small
ness
H.
welfare
mounting number of small busi¬
COMMITTEE
G.
the
Perhaps mindful of the growing
casualty lists mirrored in the
SMALL BUSINESS
Los
1950,
rivals.
mittee members
small
since
Nation's small businessmen by the
enactment of legislation designed
session
We
follows:
year,
their
of
Business
Na¬
Investment Companies.
welcome suggestions from
as
tance
powerful
gress.
Small Busi¬
ness
en¬
competitively within shouting dis¬
tablished by Senate Resolution 58,
the
Congress has expressed its
operative helpfulness
the
help small businessmen
Without stint the mem¬
bers gave of their time and energy
to make it possible for the owners
and managers of small concerns,
if not to overtake, at least to stay
when the present Small Business
Committee of the Senate was es¬
to
of
the
ordered to be printed
was
fulness during the past
year.
We
also wish to
acknowledge the co¬
tional Association of
legis¬
of the
accomplishments
1st
Congress hav¬
ing to do with small business, we
name
a
Mr.
I ask unanimous consent to have
First
Harvey B. Gram, Jr., Chairman
to
Wednesday, September 27, 1961
MR. SPARKMAN:
Session of the 87th
Fine's
those present
Sulphur and invited all
who were interested
of
a
During the course of the year
your
committee has received a
number of requests for informa¬
White
enactments
of
Com¬
terprises.
lative
islative
members
Business
the successful conduct of their
Record the small business
For useful in this
Convention.]
OF THE
1961, and also other leg¬
attached
are
SENATE
the
many
of
the
obstacles
stand between them
and
which
UNITED STATES
Small
were
meeting
THE
Investment Act Amend¬
copy
at
the
by
mittee to
of
Small
Senate
hurdle
ments of
put
vention because
Small
Business
was
Official
meeting of our com¬
the Spring Board Meet¬
mittee at
pro-
SBIC
made
the
Business
dium
Lauds
to
IN
efforts
bined
of Alabama
changes in the 1958 Act
were
Remarks
HON. JOHN SPARKMAN
Inc.,
For those interested in the sub¬
which
During the past
Publications,
of
of
Sherman Oaks, Calif., a very new
publication in this field.
Harvey B. Gram, Jr., Partner, Johnston, Lemon
& Co.,
Washington, D. C., headed the Small Business Committee,
Report of which was as follows:
t
The SBIC Newsletter, 927
Street, N. W., Washington 5,
D. C., which is published twice av
month and reports generally on
developments in this field.
15th
free
□ Stock Fund Prospectus
□ Balanced Fund Prospectus
58
Chronicle
The Commercial and Financial
Thursday, December 28, 1961
.
.
.
j
Small Business Committee,
Breakfast Meeting—Harvey B. Gram, Jr., Johnston, Lemon & Co.,
Washington, D. C., Chairman
Continued from page 57
only
and
87-341-the Small Business Invest¬
tives
of
SBIC's.
took the
These
incen¬
following forms:
(1) The amount of subordinated
debentures in
Small
an
Business
raised
(2)
of
SBIC's.
capital
and
from
Previously
surplus
banks
After
unless
in
the
SBA
grants
an
excep¬
however,
an
Mrs.
Milton
suspend
Licenses,
be revoked
can
SBIC.
not
may
&
without Federal court action.
(6)
additional
An
$75 million
was
added
to
SBA's
revolving
fund for SBIC operations, an in¬
crease from
$250 million to $325
SBIC's
(7)
with
may
(5) SBA was given broad pow¬
to investigate and issue ceaseand-desist orders against SBIC's.
small
and
investors,
incorporated or unincor¬
porated, in furnishing funds to
business firms.
Previously,
such cooperation could
only be
extended to other lending institu¬
Two
steps
1st
of
DISTRIBUTORS
•
DEALERS
the
of
business.
in
Upstate
87th
Con¬
Adminis¬
champion of small
H.R.
increased
distribution
the
Business
the
as
8762-Public
87-305—approved
effective
Sept.
26,
Law
1961,
SBA's
revolving fund
by $105 million, thus assuring the
agency funds to operate its lend¬
ing programs throughout fiscal
Additional
York
small
on
George D.B.Bonbright & Co.
ROCHESTER'S
OLDEST
INVESTMENT
ESTABLISHED
1903
Members New York Stock
lOO
POWERS
LOcust
BLDQ.
2-5200
SYRACUSE.
•
•
FIRM
to
increase
a
program
the
role
points
BATAVIA
.
SBA
Lacking this,
disagreement must be
of
to
the
White
for
House
SBA,
the
180
passed
during the
of
session
1st
the 87th Congress would be com¬
S.
Specialists in
Tax
Exempt
Bonds
and
the
of
following
enact¬
*
*
*
under this
losses
No
Law
Mr.
87-311—
to
87th
by clarifying the authority of the
Export-Import Bank to insure, coinsure, and reinsure U. S. exports
foreign
in
exports
the
United
doing
States
busi¬
in
an
aggregate amount outstanding at
any one
time of $1 billion against
and
S.
credit
1922— Public
risks
of
loss
a
to
to
Law
87-70
make
result
small
a
of
its
which
displacement
the
than
4.5
million
tax
of
and
antitrust
and
by
be
considered
gress
convenes
It
my
is
hope
prompt action
next
Etteblithed
AMERICAN
UNDERWRITERS
PRIMARY
—
1919
BXCHANGB
STOCK
DISTRIBUTORS
MARKET IN
ALL
—
(ASSOC.)
Federal
history
left
no
tem by
87-27—Area
on
Con¬
1962.
careful
these
make
as
it
possible
our
go down
Congress
a
about
its
which
desire
free enterprise
JOHN
A.
fostering and encouraging
healthy
Redevelopment Act, extended in¬
growth
rapidly
definitely
expanding national economy.
the
When it
authority
comes
of
the
along
with
our
to
connecticut...
We
specialize in Connecticut securities,
listed and unlisted, and maintain
primary markets in them. For quotations
or
statistical
information,
simply
call
DEALERS
YORK
LIBERTY BANK BUILDING
•
TELEPHONE TL 4-4970
MAIN & PINE STS.,
^NATIONAL
DEPARTMENT
BRADT
BUFFALO
BELL
2,
N.
Y.
STATE BANK
TELETYPE^BU 46
LOCKPORT, N. Y.
70 NIAGARA ST., BUFFALO 2, N. Y.
I
-
NEWARK, N. J.
'
ESTABLISHED
1812
Chas. W. Scranton
WELLSVILLE, N. Y.
209 CHURCH STREET
Direct Private Whet
to
GOLDMAN. SACHS & CO., NEW YORK CITY
TUCKER, ANTHONY 8C R. L. DAY, NEW YORK CITY
Insurance
Deposit
Co
NEW HAVEN 7, CONN.
•
Branch
Member Federal
&
Members New York Stock
Exchange
215 FALLS ST., NIAGARA FALLS, N. Y.
THORNTON BLDG.,
to
sys¬
small businesses to enjoy a
•
MANAGER TRADING
and
measures
Congress to
doubt
strengthen
when
SECURITIES
OF BUFFALO AND WESTERN NEW
en¬
were
January
that
will
year
in
program
in
both
MEMBERS
inde¬
introduced in the first session will
again
or
Law
small
completed. In the fields
relief
program
1—Public
the
which congressional action has
on
not been
highway construction
by
of
There remain, however,
some
important small business measures
for the 87th
financed
session
with
pendent enterprises.
or
construction
1st
respect
to
small business legislation will un¬
doubtedly help to improve the
competitive position of our more
renewal
was
•
to
—
disaster
business
of
Congress
federally aided urban
other
*
incurred
forcement several bills that
authorized the Small Business Ad¬
ministration
authority. *
been
President, these accomplish¬
ments
encourage small business
enter the world trade market
and
have
date."
v'V
2325—Public
ness
Currency
purposes of
the area redevelopment bill. * * *
Through March 17, 1961, loans to¬
taling $10,700,000 had been made
should
S.
lew Jen
Banking
surplus and will, therefore,
plete, Mr. President, without
mention
funds.
In
to
Committee's report on S.l stated:
"These loans can greatly benefit
areas of substantial and persistent
promote the general
which
OLEAN
1961,
velopment companies.
In com¬
menting on this provision, the
labor
has suffered substantial injury as
provisions,
30,
No summary of legislation help¬
ful
to
small
business
concerns
procurements.
Defense Department, and the Gen¬
eral Services Administration must
within 90 days from the date of
F.
Administration,
June
resolution.
any
RE
of
concurrence
obtained.
loans
its
expire
to
Paul
House
the
be
subcontractors
Under
Business
due
Mrs.
GSA,
must
as
concerns
Exchange
TELETYPE
BINGHAM TON«
of
Small
&
Before any regulations
governing this program are issued
by the Defense Department and
program.
Government
ROCHESTER, NEW YORK
BELL
subcontracting
Mr.
make loans to State and local de-„
Stimulants
laid the foundation for
designed
cooperatively
develop
business
stemming from export activities.
Legislative
Additionally, Public Law 87-305
New
small
political
1962.
year
a
during
increase the effectiveness
Small
tration
taken
were
session
gress to
•
enactment
ments:
tions.
UNDERWRITERS
Lewis, A. G. Becker & Co. Incorporated, New York;
Genachte, Chase Manhattan Bank, New York
cooperate
now
lenders
whether
the
F.
referred
million.
tion.
ers
could
hearing, SBA
a
the license of
iness firm
Banks may now invest 2%
their
capital
SBIC may lend to any one bus¬
was limited to
$500,000,
an
Administration
purchase was
$150,000 to $400,000.
their
(4) The amount of funds which
SBIC which the
may
of
(3) The amount of section 303(b)
loans which SBA may make to an
SBIC is set at 50% of capital and
surplus, with a limit of $4 million
to any single investment company.
ment Act Amendments of 1961, to
offer new incentives for the for¬
mation
1%
invest
surplus in SBIC's.
Mr.
Bridgeport
•
Danbury
•
J
•
/
Offices in
New London
Corporation
New York Phone: REctor 2-9377
•
Waterbury
Teletype: NH 194
Volume
194
Number 6120
.
.
The Commercial and Financial
Chronicle
.
59
Report of IBA Railroad
SetmSS
Committee
Sl'SfSi°5yS
Securities
James
New
York
L.Sheehan,
Partner in Dick & Merle-Smith,
City,
and
Chairman
the
of
fosses* due To8compTtitU-e™!1^-
Railroad
ences.
Since
tion
end
Level
of
World
have been
made
and
They
contained
constructive
recommenda-
tions
for
policy
and
the
of
figures
speak for themmute evidence,
financial point of view, of
from
They
a
are
of
the critical nature of the railroad
situation (exclusive of the Poca-
degree
strength
for
common
car-
rier
t
"
transpor-
t i
a
The
o n.
failure
to
ac-
complish little
than
more
—
<
minimum
progress with respect
ernized transportation
to
mod-
a
policy and
regulatory
philosophy is one of
principal reasons why the
railroad industry continues to be
a
notoriously weak segment of
like period of 1960. Outside of the
Eastern District the roads gener-
auy fared mUch better
,
the
our
economy.
To
a
degree, in certain instances
others, railroad man-
agement
with
also
should
be
charged
part of the responsibility for the present predicament of
the industry. It is our opinion that
some
railroad
management
cooperative and
more
should
more
wer but the
Most
of
the
Parriprc
nro
carnefs
are
steel
appreciable and rapid
is made in dealing with
the problems, the survival of the
District
dependent
industry
from
steel,
as
has
suffered
foreign
com-
and
op-
to
appear
A1I
Period~
District
Ra"rT
„
R°ads^
Year: 1956-—.—— 3.95%
}9££
J9££—
ut „
mos
3.30%
£.36
2.40
£-7£
effect
an
is
probably
4
combined
figj;"
man-
agement difficulties than to reflect
nronertv
property
for
return
investment
investment,
recent
aPPlied to the projected 1961
enu+®s ™ould Pr°duce a On1f.t11.op"
income of over $1.3 billion;
notwithstanding such a level of
earnings, the rate of return on
net
property
still
be
less
rocahontas
investment
than
would
5%.
Sootll(.rn
Westcrn
Region
District
R°ads
Roads
8.44
4.17
8.68%
J4i
RoadsL
5.00%
3.54%
3.18
3,88
3,20
6.89
3.63
2.87
L40
_0;98
5;07
^
years
on
The
Ihe
are
its
in
Table I.
1,954,793
2,386,196
2,292,112
—19.5%
—14.7
2,506,536
2,898,441
—13.5
2,492,148
-15.5
Weeks June
4
Weekg
2,860,298
2,173,783
2,966,799
2,351,174
2,580,437
5
Weeks November
4
Weeks
0ctober
3,062,371
2,298,399
2,963,099
2,328,706
2,557,643
—
6.6
—
5.4
+
0.1
-j-
1.0
+
0.9
2,725,718
December
1,878,036
These,
FULLY INTEGRATED
63 consecutive
course,
figures and while
ber of roads
will do
there will
be
a
c.„
gs Up Sharply
by months
car loadings
in comparison
in 1961
with
cor-
responding figures for the preced-
are
ing
num-
year
given
are
in
Table
First to become PUBLICLY OWNED
quarterly dividends, totaling $17,174,478.
expand and a
new record was set
The
drastic
road
earnings
one
casualty,
reduction
waste is to
rail-
was
September, fol-
lowing refusal
of
the
I.
C.
C.
stable
and costs remain
a
ance.
The
assist-
$253
loans will
it
the
of
rougher spots by guartheir
borrowings,
as
1958.
At
principal
guaranteed
the
loans
of
of
an
statistics
Since
add up
the
a
period when costs
is
reasonable
savings
were
to
suppose
that
understated
are
MONTH
on
broad national basis
a
that might reduce the number of
systems
ap-
could
show
to
as
mean
few
10
or
12
(pretax)
in
as
savings
transportation costs of upwards of
Continued
on
page
TABLE III
Estimated Savings
Atlantic Coast Line—Seaboard Air Line
^___
Great Northern—Northern
Pacific—Burlington__
Norfolk & Western—Wabash—Nickel Plate
.__
Chesapeake & Ohio—Baltimore & Ohio
Pennsylvania—New York Central
TABLE
IV
All Class I Railways—Gross
Expenditures
$38,700,000
43,000,000
27,000,000
45,000,000
100,000,000
Capital Expenditures
Expenditures
Roadway
on
Equipment
Total
(000)
$406,500
386,956
285,615
$821,357
1,007,749
479,680
567,546
633,484
Total—$1,587,883
$3,509,816
258,356
250,456
$1,227,857
1,394,705
738,036
818,002
919,099
'
$5,097,699
M
73 rd
year
EARNINGS
,
Earnings
Earnings
Earnings
10
for
for
per
Months
10
months
Ended
10/31
12
Months
Ended
10/31
—
1961
1960
$2,116,060
$1,908,284
$2,798,056
$2,540,939
$1.34
$1.25
$1.79
$1.69
1,520,600
1,430,494
1,511,836
1,428,956
share Common for
Ended
10/31..
Earnings per share Common for
12
Months
Ended
10/31
TRENTON
TRUST
Average shares Common Stock Outstanding
10
Months
Ended
10/31
—
Average shares Common Stock Outstanding
12
Months
Ended
10/31
SUBURBAN
General
PROPANE GAS
Offices
A
THIRD
OF
CORPORATION
COMPANY
New York Office
Whippany, N. J.
20 Exchange Place
A
CENTURY
OF
DEPENDABLE
SERVICE
"to
28
\AJcctp
WEST
Member
in
It is estimated railroad consoli-
improving trend
on
to
studies
lower level than obtain
today,
dations
proximately $153,000,000.
traffic
a
savings
terms of current costs.
such
aggregate
,
suggested these savings date
such
present time
amount
0
shown in Table III.
are
annual
back to
provided for in the Transportation.
Act
„
million.
that
helpful in assisting several roads
anteeing
,
savings (pretax) that may
realized from current merger
be
at
the
the
and
annual
number of roads will un-
Inability to obtain
*
proposals
result in financial
embarrassment,
The I.
C.
C. has been most
over
avoided
Projected Merger Savings
Some idea of the estimated
relatively
doubtedly require financial
.
„
to
guarantee any further
borrowings
ijl Unless
tt
i
4
the carrier.
traffic recovers
be
public is to receive improved
transportation service at the lowplaced est Possible cost,
already produced
namely, the New
Haven Railroad which
in bankruptcy last
1957086
in
as
1818 -1961
TEN
II.
Piggyback loadings continue to
great
a
T
Freight
as
considerably
also
mm*
LP-GAS COMPANY
of
,r
Our
SUBURBAN PROPANE
only
,
Tiggyback Loadi
1961
year
Year
% Change
1961-1960
\ $£*s April--------- 2,106,107
^ Weeks September
figures
I960
February
5 Weeks August
net
given
1961
Weeks July
1960.
average
Recent
Region
1,921,855
5
the
approximate 2.5 times,
evidence
January
4
for
t° accelerate at least throughout
the first half of 1962.
contrasted with 2.9 times for the
rev-
era^mg
1.42
5 Weeks March
unsatisfactory national trans-
of
Weeks
4 Weeks
the railroad industry of
rate
indicated
only 5.5%.
The 1935 profit margin of 14.5%
Carloadings of All Class I Railways
better
no
the
portation policy and internal
the
the
TABLE H
exemplify
on
for
current year's result is
2.72
Period—
to
the 1935
equivalent to
way,
were
14-5% °f operating revenues for
that year, whereas the corre-
be
Figures Tell the Story
There
earnings
Net Property Investment
Eastern
Class I
'
,r
on
inevitable.
way
net
another
TABLE I
Rate of Return
an
ownership
would
larSely
considerably
integral
part of our free enterprise system is seriously in
jeopardy and
government
Eastern
states-
Unless
eration
case
larcfoiv
uP°n heavy industry such
The
Stated
echne was Sp0ndjng rati0
Region carriers.
be
progress
as
wat,
cline being about 20% in the
in coping with general
problems of public transportation.
industry
dppl1np
not appreciable, the greatest de-
menlike
railroad
f,
of the Pocahontas
than
more
Earnings
.
t
taxes)
should
anticipated the recent
improvement will tend
railroad operations) is going to be
Aggregate net income of the
Wel1 conceived and equitable
<luite unsatisfactory. Total oper- class I railways is expected to Plans for consolidation of railroad
ating revenues should aggregate approximate $400 million in 1961, properties are in the public inapproximately $9.1 billion, as con- or about 10% less than the $444 terest. They shoulld be sanctioned
trasted with $9.5 billion for the million earned in 1960.
without undue delay if economic
of rising costs and shrinkvolume. Nineteen
nearly
financial
come
is
of
.
—
higher
Class I railways combined earnings coverage of fixed charges
(before deduction of Federal in-
it
The year 1961 for the railroad many that won't do nearly as recently when 13,461 cars were
industry, from the standpoint of well, while in certain instances, loaded in a single week, a gain
net railway operating income especially in the case of Eastern of 46.5% over the same week of
(earnings
derived
from
direct lines, deficits will be reported.
the year 1959.
years
a
rate
better
preceding year. Net railway operating income probably wont
llfF- < ing
exceed $500 million, or $84 mil}
50%
of the 40 railroads as- ^on ^ess than for the year 1960.
signed to this district classification Such a depressed level of net
\ reported an operating deficit for earnings is comparable only with
-ri the first eight months of 1961. The the results obtained in a depresEastern District, as a whole, re- si°n year such as 1935. However,
ported an operating deficit of $62 in 1935 the combined revenues of
million for the first eight months ail the class I roads totaled $3.45
of 1961, as contrasted with
operat- billion, or less than 40% of the
JamesL.Sheehan
ing earnings of $49 million in the current level of revenues,
pro-
motion
publi-
numerous
The
selves.
at the present time.
operating
in
the
jmPEastern District (exclusive of the
X
Pocahontas carriers) seem to have
/-M suffered the most in the last few
transporta-
tion
II
hontas roads)
The
roads
the
modernization
of
War
major studies of transporta-
cized.
1961 Net Earnings at Depression
vV'W'Av1
the
seven
and
Below 1960 Ratio
year
Securities Committee,
presented the following Re¬
port to the Convention.
i-'tf-.;
Average Fixed Charges Coverage
ctatc
STATE
Federal
ct
ST.
Deposit
mary g. roebling
president
Insurance
a.
chairman
Corporation (
60
60
■
The Commercial and Financial Chronicle
»
^
V.
Phil Hettleman, Hettleman & Co., New York;
John Wasserman, Asiel & Co., New
John Chapin, Eaton & Howard, Incorporated, New York;
York; J. Raymond Smith, Weeden & Co., New York
Continued from page 59
$1 billion annually. It is realized
(d) Freedom to provide a diver¬
sified transportation service.
such
The objective of the Association
a
result
would
be
difficult
of accomplishment because of the
less,
imponderables. Neverthe¬
this does not alter the fact
that
colossal
many
road
costs
reductions
may
in
rail¬
be derived
from
is
noble. Its accomplishment will
be
extremely difficult because of
the political aspects involved.
Although dictated to
a
certain
extent
by the flow of traffic and
earnings, railroad capital expendi¬
"Magna Carta for Transportation"
The
Association
of
American
Railroads plan for alleviating the
serious condition of the industry
is
known
as
"Magna Carta for
Transportation" and embodies a
petition to Congress requesting
the following "Four Freedoms":
(a) Freedom
from
discrimina¬
tory regulation;
(b) Freedom
from
stricted
of
Gross
capital expenditures of all class I
railways since the end of World
War
II
have
totaled
in
excess
of
$16 billion, or roughly $1.1 billion
pen annum.
this
sum
competition;
subsidized
been
expended
on
on
road¬
for
credit
status
few carriers, the bor¬
recently
have
been
re¬
mainly to the financing
equipment purchases.
Such
been
ing
a
expenditures
heavy drain
capital
of
the
on
have
also
the work¬
carriers.
For
example, at the close of July, 1961,
railways aggregated $832 million,
a
reduction of $313 million in the
period of
way.
tures
a
poor
About two-thirds of the working capital of all class I
has
Table IV presents such expendi¬
from
of all but
rowings
tures continue to be made in sub¬
tory taxation;
(c) Freedom
expenses, such as depreciation ac¬
cruals, sale of assets and borrow¬
ings. Because of the unsatisfactory
earnings position of the industry
stantial amount each year.
equipment and one-third
discrimina¬
These expenditures on the part
the railroad industry are pro¬
vided for from earnings, noncash
resultant
each
of
the
last
five
throughout the first half of next
year
and consequently an im¬
proved earnings situation. Further
the
comparatively
past
year,
little
reflecting
principally the changing fortunes
of the
respective obligors.
Dow
-
Jones
closing
ago,
of
year
advanced to 147 by the end
to
133
on
July
19
from
business
railroad
certain
railroads
is
anticipated from the
Congress.
Notwithstanding
the
tempo¬
rary
favorable outlook for the
railroads,
experienced
discrimi¬
nating investors, so necessary to
next session of
the
industry if its health is to be
restored, will not invest
only
therein
new
under
reasonable
small
level.
exceptions such
the
more
equal
fraction
of
a
They do make
as
in the
case
equipment loans and hold
of
condi¬
permit earnings
a
long-
favorably
a
of
few
situated
quite
ketwise,
as
Until
a
proper
such
time
therefore
as
presentation of the situa¬
tion is made to
latter
to
enacts
assure
Congress, and the
legislation designed
investors that they will
securities
following
the
Respectfully submitted,
SECURITIES
COMMITTEE
James L.
Dick
New
Sheehan, Chairman
&
Merle-Smith
York, N. Y.
Charles L. Bergmann
,R. W. Pressprich & Co.
New
York, N. Y.
James H.
Carson
Salomon Brothers & Hutzler
New York, N. Y.
Gustave
L.
Levy
Goldman, Sachs & Co.
York, N. Y.
New
W. Wendell Reuss
W.
E.
New
Hutton
&
Co.
York, N. Y.
Alfred J. Ross
New
Eugene
&
Merle-Smith
York, N. Y.
Treuhold
L. F. Rothschild & Co.
New
York, N. Y.
Philadelphia-Baltimore Stock Exchange
(associate)
in
Municipal Bonds
in
Corporate and Municipal
Securities
THE PHILADELPHIA NATIONAL BANK
Land Title Building
Organized 1803
PHILADELPHIA
PHILADELPHIA
Branch Offices:
Baltimore, Md.
Bethlehem, Pa.
Huntingdon, Pa.
and
RAILROAD
New York Stock Exchange
Underwriters and Dealers
mar¬
ebb
progress.
MEMBERS
Dealers
should
volatile
co.
American Stock Exchange
to
it should
flow of earnings and consolidation
Dick
a
opportunity
every
the
prove
equities.
the first quarter then
dropped
back
In
quarters
corrective legislation favorable to
railroad
stock averages stood at 129
given
conduct
consolidation proposals and prog¬
ress in this connection should also
be witnessed.
that
during
be
be,
materially better traffic outlook
a
to
done
on
Investors' Attitude
figure at the close of 1955.
bonds
153
nearly
The near-term prospects are for
funds
railroad
to
rose
term
year
Marketwise,
ELKINS, MORRIS, STOKES
it
Currently it stands about
11.
151.
tions
have
Thursday, December 28, 1961
Oct.
and almost $800
years:
.
.
whence
million beneath the corresponding
a
.
'
'
•
Ed. Bueltman, Blair <ft Co., Inc., New York; Bill Marlin, Bache & Co., New York; Mr. & Mrs. Robert
Krumm, W. H. Morton & Co., Inc., New York
of
and
consolidations.
'
1,
PA.
Volume
194
Number
6120
.
.
The Commercial and Financial Chronicle
.
61
It was
Report of IBA Governmental
influences in the
to
Securities Committee
Governmental Securities
Committee is happy to report that
the
Administration
new
of
the
Treasury Department has honored
with
us
invi¬
tations to
time
on
riety
a
of
factor
with
ther
the
In
va¬
cies.
ei¬
in
The
There has been
new
Market
stable
in all,
these
Under
the
Secretary for
Monetary Affairs, Roosa and his
competent staff has adopted a
approach
in / February
by
in
the Federal Reserve Open Market
Committee of a policy broadening
ministration
the maturity area of Treasury se¬
curities eligible for its operations
the
to
tion
changing needs of the
na¬
financing increasing ex¬
penditures in accordance with Ad¬
been
commitments.
aggressive
utilize
prove
every
the
in
its
efforts
opportunity
debt
has
It
to
structure
to
im¬
at
or
least preserve the average life of
marketable debt against the
in
and
Some
with
feared
mixed
pert administration, be subject to
abuses and possibly lead to the
type of market support which
could
bring about rigidities in
certain parts of the fate structure
mechanism and through the terms
of
its
regular refunding opera¬
tions.
The report of the previous year
stated, "Our unfavorable balance
payments
new
has
added
a
brand
problem to overall debt
agement
man¬
and monetary policy"—
the year as a whole has borne this
out
and
debt
it
has
been
management
believe
the
a
factor
decisions.
in
We
international flow
of
the
was
abandonment
of
the
of
our
rates
on
short
Treasury
obligations together with domes¬
that
any par¬
rate
of
the
' :'s/'
;
struc¬
bill
"
for cash
and
cash
refunding
depressive
dollars, of which nearly 7
of
the
15
SVz
was
months,
so
carrying
21/4% interest, maturing in 1962,
and
two
issues carrying higher
rates maturing in 1963, the priv¬
ilege of extending into bonds due
The recent projections of
budg¬
etary requirements
reveal
that
the January-June period will bal¬
in
ance
November
of
the
1970
of
2i/2%
and
"senior
and
4
7
year,
month
1967.
$6 billion securi¬
this exchange.
In
accepted
middle
the
1966
price
impact.
over
leap
offered
frog"
advance
the
re¬
totaled
$33A
billion
to be
Banks.
require
cash
attractive
refunding
securities
par
extension
the
Treasury
has arranged
16
major debt operations outside of
most
or
which, under
program,
circumstances,
appears
the
Treasury bill rollovers. These
financings totalled $65 billion, of
which $23.5 billion had a life of
over
eighteen months. There
also
twelve
issues.
increases
The
banking
in
Urges New Debt Ceiling Policy
The Treasury's debt is
currently
nearly $297 billion, just under the
legal limit of $298 billion. Such
an
absolutely
inflexible
legal
were
bill
the
system
and
the so-called "other
limit
investors," in¬
cluding private industry and for¬
eign interests, added significantly
can
prevent the Treasury
using several practical debt
from
management tools for the refund¬
to their
holdings of Treasury ob¬
ligations, particularly in the short
ing of approaching maturities. It
is
suggested
area.
year
Sales of E and H Savings Bonds
have been at an encouraging rate,
calator
but
maturities
of
older
issues
mit
that legislation next
provide for
clause
the
a
temporary
which
would
debt
ceiling to be ex¬
periods only,
then solely for accommodat¬
ing the refinancing of maturing
an
year.
The
Treasury's task will not be
recently announced
an
offering to
one
in
the
next
six
months. It would appear that our
exchange these for
a
marketable
Continued
easy
on
page
re¬
$6.9 billion
some
ma¬
as
Drexel&Co.
4 years,
calendar
of
Established 1838 *
Jan.
.1, 1961.
Underwriters and Distributors
with
circumstance.
Active Year for Treasury
of
Financing
The
tion,
new
Treasury Administra¬
Public
Utility, Industrial and Railroad Securities
State, Municipal and Revenue Obligations
evidences of its dedication
as
Members
New York Stock
American Stock
Exchange
Exchange (Assoc.)
Philadelphia-Baltimore Stock Exchange
Philadelphia 1
New
1500 Walnut St.
York 5
45 Wall Street
Underwriters,
Distributors,
UNDERWRITERS
•
DISTRIBUTORS
•
BROKERS
Dealers in
For
CORPORATE
AND
MUNICIPAL
over
SECURITIES
60 Years Effective Distribution in
Delaware Valley U. S. A.
Established 19J0
Newburger
B utcher
Sherrerd
&
&
Company
Members:
New York Stock Exchange
•
American Stock Exchange
Philadelphia-Baltimore Stock Exchange
1500
WALNUT ST.,
I
.
.
PEnnypacker 5-2700
Members
New York Stock
Exchange
•
•
•
Phila.-Balto. Stock Exchange
•
PHILADELPHIA 2, PA.
'
Teletype: PH-4
•
•
•
1401 Walnut
•:
.
•
Street, Philadelphia 2, Pa.
•
LOcust 8-1500
New York BArclay 7-4641
American Slock Exchange (Assoc.)
•
•
•
Boston Stock Exchange (Assoc )
es¬
per¬
ceeded for two week
no
debt.
figures
so
important and desirable.
The Treasury, following its
practice of the past few years, has
the
for
exchange re¬
funding and, at that same time,
pursue a furthering of the debt
series F and G bonds mature next
average
It
busy half-
a
in Treasury finance and will
a favorable atmosphere to
year
active year—
an
Reserve
appear
create
value.
This has been
$35 billion,
$26 billion is held outside
Federal
would
justments. This privilege was ac¬
cepted by about 50% of the hold¬
and
receipts and
as
concerned.
are
amount to about
overs
of which
a
funding with a choice of 3!/>%
bonds due in either 1980, 1990 and
1998 with appropriate price ad¬
ers
far
as
Ma¬
turities during this six
months, ex¬
cluding 3 and 6 months bill roll¬
September, owners
maturing in
were
overall
expenditures
bonds
1971
yearend it should be close to the
The shift, at that time, by
unlikely
that this extension into this issue
will have
any
noticeable
issues
September
close to
by
two
longer offered for sale are becom¬
ing sizable. Nearly $1 billion of
maturity, provided
The
middle
billion,
financing, the exchange
extension.
in the
one
Your
committee has consistently urged
the transfer of ownership of this
class of restricted bond into mar¬
ketable obligations. It is
and
turity of the marketable debt
emphasis
on the one-to-five-year area
and,
to some degree, on the five-to-tenyear category may have prevented
this
in the
than
of that date
competing rates abroad might tend
to place renewed pressure on the
securities
pattern
funding of the large
debt
longer
new
actual
Anticipation Bills, and the re¬
on exchange re¬
funding operations and Trust Ac¬
count requirements. The most re¬
Nov.
funds, in addition to imbalances
little
to be persuaded that
Open
operations were directed
retirement
"bills
dollar.
is
mainder attrition
was
in payments abroad, can well be
the product of the competitiveness
the
that
the Federal Reserve Open Market
Committee to the purchase of
port¬
Tax
done to prevent
the short rate from declining to
a degree that its
relationship with
only" policy
There
other
cent
thought by others
their
billion represented the cash
budg¬
et deficit, one and a half
with harmful results.
It
in
probably eased by these
billion
such a policy
but the most ex¬
relentless passage of time—by the
medium of the advance refunding
system
volume, had no
impact on
the
market. The larger cash require¬
ments as they developed,
brought
the
total
needed
in
the
JulyDecember period to better than 11
that
any
liquidated by the
shortening efforts last spring
real
reactions.
could, under
ab¬
year
while increased in
market, to include notes
even
the longer bonds, was
received
the
one
arbitrary alteration of
sold
the
the
of
securities
Also,
over
budget picture for the fiscal year
ending June 30, 1962. The financ¬
ing in July and August followed
a relatively unobtrusive
exchange
refunding pattern and securities
Policy
adoption
was
first nine
facilitated by
As you are well
aware, domestic
and
foreign developments have
caused
several
revisions in the
Treasury's
of
owners
1961
area.
factors
The first
year.
months of
the
bond—the 37/8s due in 1968.
part of March, which we speak of
as
a
"junior leap frog," offered
ties
ture
since
New Open Market Committee
The
as
debt management,
its security holders two
advance refunding operations this
during
ticular
objectives.
George B. Kneass
constructive
of
have
unobtrusive
to
financing
to
Committee
level
to
the
the
policies
offered
Holders of
Market
mosphere for the most part for the
achievement
Dillon
and
Open
for
revised
appear
How¬
to constructive
that the record volume of
private
reason
have provided an encouraging at¬
"team" of Sec¬
broad
change in
activities of the Federal Re¬
propriately
April.
All
Treasury
and
no
the
objectives
policies.
have kept free reserves at an ap¬
attend¬
retary
to
was
or
ance.
The
continued
folio
the Federal Reserve discount rate.
full
responsible
of
banking
activity,
the Treasury
has generally experienced a fa¬
vorable background for its poli¬
sub-commit¬
tee
gradual rise in
a
February.
these
operations.
sorption of the
management deci¬
the f ace of
serve
a
debt
industrial
to
committee
in
those
area
mat¬
ters
international
thinking as
to our fiscal
responsibility. This
increasing sensitivity must be a
con¬
time
and
attributed
assistance to the flow of funds
into appropriate domestic market
areas.
There is ample evidence
sions.
fer with them
from
tic
since
execution
their
moves
Open Market Committee's
ever,
reproduced herewith.
The
the
activities
George B. Kneass, Senior Vice-President of the
Philadelphia National Bank,[was Chairman of the
Governmental Securities
Committee, whose Report
is
naturally popular to try
interpret other goals or subtle
to
New York
Pittsburgh
Lebanon
Atlantic City
Yineland
62
62
The Commercial and Financial Chronicle
Governmental Securities Committee, Breakfast
Meeting—George B. Kneass, Philadelphia National Bank,
Continued
from
61
page
tions, either through the dissem¬
Robert
B.
Blyth
ination of information to custom¬
The National City Bank
Cleveland, Ohio
abroad,
particularly when for¬
eign exchange is hedged against
just as importantly, the
underwriting,
either
by
direct
purchase or by making
ample
adverse
credit
available
group.
Your
are
becoming
more com¬
petitive with similar investments
from
fluctuation and deducted
interest. Nevertheless,
the
Treasury must sell, in the
market place, a variety of secu¬
gross
rities in substantial volume. These
must
be attractively tailored to
meet
the requirements
vestor
classes
and
effective
committee
are
joyed
the
placed
to
trust
in
the
committee
them
and
Milton
dealer
has
your
instrumental
supporting these Treasury
1961
All-Institute
Essay
H.
Wells
.
W.
DeHaven
Townsend, Crouter
&
Established
&
Bodine
1874
H.
American
member and
York
&
Philadelphia-Baltimore Stock Exchanges and
American
Stock
LAND TITLE BUILDING,
Exchange
John
Union
Trust
Trust
New
as
New
York
Co.
Corporate and Municipal Issues
New York
Fireside 8-6466
Wilkes-Barre, Pa.
Jenkintown, Pa.
FLanders 2-0838
VAIley 3-4131
TUrner 7-7660
G.
Larkin, Jr.
preferred shares
Morgan Guaranty Trust Co.
New York, N. Y.
The
Co.
vanced
in
Partner
of
Cleveland,
as
Investor
is
Interested
in
of
Investment
three-y ear ad¬
development program
a
J.
Mr. Talbott is
of
Prescott
in the
corporate
tions,
&
general partner
a
Co.
and
and
mergers
initiation
and
specializes
of corporate
areas
of
finance,
acquisi¬
new
un-
derwritings.
A graduate of Yale's
Sheffield Scientific School with a
B.S. in Industrial Administration
and
Engineering, he became
asso¬
ciated with Prescott & Co. in 1958
and was elected to general
part¬
nership in 1960.
and
committee
nance
Corporation
The
He is also
chairman
of
and
Company,
both
serves
Cleveland
fairs
of
a
Council
and
Board
is
1961
Advisors
Heart
fi¬
director
of
Dayton.
Mr.
trustee of the
World
on
of
land Institute of Art.
the
di¬
Talbott
member
a
a
the
Manufacturing
of
as
The
a
Huffman
Talbott
of
of
the
Af¬
the
Cleve¬
He directed
Fund
Drive
the Cleveland Area Heart
for
Society.
a
Pattberg, Jr.
The First Boston Corp.
New York, N. Y.
H.
Primary Markets in
Perkins
Illinois
National
PENNA. UTILITY AND INDUSTRIAL SECURITIES
Trust Co.
PENNA. BANK AND INSURANCE STOCKS
Chicago, 111.
New
DEPT.
Talbott,
Co.
Co.
The First National
•
from St. Francis College,
York, where he majored in
economics, and an M.B.A., degree
from New York
University.
rector
Institute
Banking
PENNA. MUNICIPAL AND REVENUES BONDS
Delmont K. Pfeffer
FINANCING
dele¬
of the Second-year Class
Essay
Competition,
received
a
$250 award and briefly addressed
the delegates on the
subject of his
paper: "Investment Policy for the
The
1
Trust
a large New
City bank. He holds an A.B.
York, N. Y.
Bank &
municipal bonds
the
Real Estate."
Morris
Continental
PENNSYLVANIA AND GENERAL
Convention
winner
Securities
Northern, Trust
C.
S.
&
r
Chicago, 111.
John
•
Annual
addressed
the subject of his paper:
on
Prescott
Ralph F. Leach
Emil
CORPORATE
50th
briefly
$500 Award
and Pitfalls."
Bankers
market
the
and
Mr.
a
panies—Investment Opportunities
Francisco, Calif.
New
and
Committee.
San
Robert
INDUSTRIAL AND UTILITY
of
Bank of America N.T. & S.A.
Pat G. Morris
Upper Darby, Pa.
common
Education
gates
Security First National Bank
Calif.
Stamford, Conn.
the
"Small Business Investment Com¬
A. Kent
Frederick
ONE ATLANTIC STREET
Dlgby 4-0200
Robert
at
Los Angeles,
30 BROAD STREET
by
Association
Banking, announced
Mason, Chairman of the
Nelson
Stock and Bond Brokers
Bankers
McCarthy received
Chicago, 111.
Russell
Nelson S. Talbott
sponsored
part of its annual Institute
IBA
York, N. Y.
Harris Trust & Savings Bank
Distributors, Dealers, Underwriters
McCarthy
Investment
Hardin H. Hawes
System Teletype—PH 518
M.
Competition
Investment
Cincinnati, Ohio
Bank
department of
trust affiliate of
New
Greer
Chemical
PHILADELPHIA 10
officer in the in¬
an
research
degree
Angeles, Calif.
Alfred H. Hauser
Telephone LO 4-2900
Bell
Bank
Co.
Members
New
the
York
Third
companies
Business
vestment
California
Fifth
for two
manager
investment
Shares, Inc.). Prior
present association, Mr. Mc¬
Carthy served nine years as a
Fargo Bank
Lyman
and
to his
Wayne Glover
The
Finance
University
(Affiliated Fund, Inc. and Ameri¬
Francisco, Calif.
Los
of
the
on
of
Pennsylvania Campus in Philadel¬
can
Empey
United
Registrants meet
spring at the
School
Commerce
ex¬
IBA
each
Co., investment
Trust Co.
San
Wharton
open-end
York, N. Y.
Lester
firms.
week
a
from
Mr. McCarthy is a senior secu¬
rity analyst with Lord, Abbett &
C.^J. Devine & Co.
New
for
personnel
phia.
Jacksonville, Fla.
George B. Kneas, Chairman
The Philadelphia National Bank
Philadelphia, Pa.
the
Stewart A. Dunn
COMMITTEE
opera¬
of
The Atlantic National Bank
Respectfully submitted,
in
Childs
James A. Cranford
GOVERNMENT SECURITIES
man¬
member
Chicago, 111.
and
individually by Treasury officials
its
pursue
perienced
HOLLYWOOD, Fla.—John M.
McCarthy of Lord, Abbett & Co.,
New York, was named the winner
C. F. Childs & Co.
confidence
collectively
Newell
officers, and other
partners,
Contest Winners
S. Bosley
Detroit, Mich.
F.
en¬
sponsored by the Association for
IBA Institute's
National Bank of Detroit
allow the
policies of debt
The members of
agement.
or,
of the in¬
also
Treasury to continue to
ers
Thursday, December 28, 1861
.
.
Mr. & Mrs. Malcolm S. Prosser, Seattle First-National Bank, Seattle; Mr. & Mrs. Lyle F. Wilson,
Pacific Northwest Company, Seattle; Sherman Ellsworth, Wm. P. Harper <£ Son & Co., Seattle
Philadelphia, Chairman
bill rates
.
City Bank
AND
York, N. Y.
OTHER GENERAL MARKET SECURITIES
L. Sumner Pruyne
The First National Bank
WOODCOCK, MOYER, FRICKE & FRENCH, INC.
Fidelity-Philadelphia Trust B6ilding
123 South Broad Street,
Philadelphia 9, Pa.
BRANCH OFFICE: 105 Coulter Ave.
New York: WAIker 5-0312
Ardmore: Midway 9-4900
Teletype PH-160
Members New York Stock Exchange
Phila.-Balto. Stock
Exchange
American Stock Exchange
Business Founded 1842
(Associate)
Janney, Battles
./
Lockett
Ardmore, Pa.
Telephones Phila.: Klngsley 5-7200
Boston, Mass.
Herbert N. Repp
Discount Corp. of New York
New York, N. Y.
,
Shelton
Republic National
Dallas, Tex.
Girard L.
&
Bank
Spencer
Salomon Brothers & Hutzler
New
1401 Walnut
York, N. Y.
William
E. W. Clark, inc.
MEMBERS: New York Stock Exchange
J. Wallace
Mellon National
Co.
Pittsburgh, Pa.
Direct
Bank
&
Trust
Phones
Trading Wires
—
to:
•
Street, Philadelphia 2, Pa.
Phila.-Balto. Stock Exchange
Carl M. Loeb, Rhoades
Philadelphia, LOcust 8-3400
•
& Co., New York
New York,
•
•
American Stock Exchange (Assoc.)
A. M. Kidder & Co., New York
WOrth 6-5646-7
•
Bell
Teletype PH 80
Volume
194
Number 6120
.
.
The Commercial and Financial Chronicle
.
63
Report of the IBA
Research Committee
Spring meeting this
our
announced
School had
duct
it
to
study
con-
of
the
issue
market
that
been selected
^three-year
a
new
year
that the Wharton
firm
covering
the
this
of
this
The
have
since
been
of
on
the coverage
be obtained in the time
agreed
can
and
with
This
study
the
available,
embrace a com-
money
will
prehensive
sources
Ralph F. Leach
that
meeting
which
examination
of funds of both U. S.
of
cor-
porations and of state and local
governments. It will examine the
growth
issue trans¬
nature
the
size
ing industry, and its history in¬
cluding the changes in its
will
also
structure
balance
devoted
and
and
i t y
market
this
the
to
non-members.
which,
School
in
ing
closely
new
the
issue
corporate,
major
ex-
sectors
and
that there will be
a
minimum
bling the data required.
Questionnaires
rently
will
sent
collected
in
investigate
the
disruption to the normal work
would
like
to
stress
statistical response which
obtain from
all
of
you.
therefore
the
that
each
responsibility
operation
and
to
within
other
of
to
all
I
ask
take
to
stress
own
firm
your
area.
firms
in
We
will
be
working
regional groups to elicit
to
we
your
co¬
through
close
as
100% response to these ques¬
as possible.
a
tionnaires
Following the collection of data
in the first quarter of 1962 the all
important third phase of the
pro¬
gram,
evaluation
and
analysis,
will be under way by mid-1962.
At this time we expect to call on
of
some
fields
some
the
to
leaders
assist
of the
in
in
various
interpreting
basic material.
Fol¬
lowing that a series of studies
growing out of this project will be
published.
that
be
It
is
our
expectation
the first of such studies will
available
by
this
time
next
I think it would be well to
point
out
how
fortunate
we
the
was
in
the
that
shown
securities
we
thorough
of 1962.
pre-test
with
In
at
a
pressures were at a
Cary
the
may
us
pre-
the
have
proposed
think
both
to
had
it
say
apparently concentrate
investor safeguards with an
phasis upon trading on both
to
on
differences
emphasis
comprehensive
materially
which
in about
a
at
with
the
the
individual
extent
some
legally
it
is
oriented
individual
on
investor.
and
limited
upon
the
of
Study
is to provide
as a
W.
Cleveland, Ohio
Investment Bankers Association
Washington, D. C.
George
role
A.
Newton,
President of IBA
G. H. Walker and
hand
St.
Louis, Mo.
(Ex-officio)
Company
'
Thomas
M.
'
J
■
the
on
York, N. Y.
Yost Fulton
Murray Hanson
areas
other
entire
Co.,
Fulton, Reid and Company
Of
Johnson
(Ex-officio)
Vice-President of IBA
whole, studying and
the
Trust
Kidder, Peabody and Company
may re¬
analysis
Guaranty
York, N. Y.
New
a
broad background
of information and
The
Johnson, Lane, Space Cor¬
poration, Savannah, Ga.
played
means
under
be
more
was
on
but
pertinent
relationship
Joint
ma¬
UNDERWRITERS AND DEALERS
external
study
little bit
a
basic
CORPORATE-MUNICIPAL
SECURITIES
I
for
about
of
UNLISTED TRADING DEPARTMENT
our
author¬
Resolution
438.
Established
Bioren
1865
Co.
6-
MEMBERS
New
York
Stock Exchange
American Stock
Philadelphia-Baltimore
1424 Walnut
WARNER, JENNINGS,
MAN DEL & LONGSTRETH
Members New York Stock
and other
Exchange
Slock
Exchange
Street
120
Broadway
Philadelphia 2, Pa.
New York 5, N. Y.
PEnnypacker 5-9400
BArclay 7-9300
I
Exchange
J. W. SPARKS & CO.
ESTABLISHED
Principal Exchanges
1900
MEMBERS
NEW
YORK
STOCK
EXCHANGE
AMERICAN
;
...
a.
...,
.
■
..
,v.
PHILA-BALTIMORE
STOCK
■
.
STOCK
EXCHANGE
EXCHANGE
i
:
; ;■.
:.
Brokers in
121 S. BROAD STREET
LISTED and UNLISTED SECURITIES
PHILADELPHIA 7, PA.
Dealers in
STATE, MUNICIPAL and REVENUE BONDS
DIRECT
A.
NEWARK, N.J.
•
BOSTON, MASS.
•
MIAMI BEACH, FLA.
•
T.
&
WIRE
T.
TO
NEW
YORK
TELETYPE—PH
622
HONOLULU, HAWAII
120
New
210
Western
Broad
&
Fund
Broadway
York
5.
Chestnut
7,
Pa.
6-4040
N.
Y.
Bldg.
WOrth
Philadelphia
KIngsley
Saving
end
William M. Adams
IB A-Wharton
the
on
a
end
Amyas Ames
quire special treatment. The basic
objective
the
useful, ef¬
projects.
Morgan
New
focusing
aberrations.
fringe operators that
more
a
Respectfully submitted,
To
likely to be
report
be
of
our
Braun, Bosworth and Company
Detroit, Mich.
necessity it will probably have to
concentrate
may
on
super¬
vision of the market for the
sake
of
body
Ralph F. Leach, Chairman
special
problems of regulation and
final
product from both
is
will undoubtedly
year
length
the
to
pic¬
just
beginning and is to be completed
deal
and
contribute
fective, valid and meaningful
by the investment banking
community.
study
to
some
approach
also
industry. To this extent
result
ture of the economic services
pro¬
SEC
and
be
data that will be available
vided
The
could
in
should
or¬
group
a
there
em¬
activities will be included in order
provide
material
markets
minimum. On the other hand
a
the
organized exchanges will not re¬
ceive any detailed examination
by
to
extent
issue
duplication of data collection.
It
hoped that this well be kept
exchanges and over-thecounter markets. Activities on the
Wharton
our
is
ganized
the
new
same
re¬
comments
some
SEC
would
possible
ized
this
the
of
minimum. Mr.
found that while study to that which
firms sometimes
in
were
business
very
of prep-
will
some
the
will have prepared for the
when
process
a
upon the new
The
SEC
study
markets.
in
by Congress
some
period
in
primary emphasis
issue
industry
time
the
a
banking
undoubtedly
cover
basic
same
comprehensive examination of the
investment banking business with
assessing
interest
of the
some
data. The Wharton
study will be
the challenge to study our own in¬
collection of
bank and non-bank firms.
a
,
deal with
investment
economy.
In effect the Wharton
study and
the SEC study will
tally different in scope, orientation
objectives but will inevitably
starting this project well over a
year
ago.
Having thus accepted
cent
by
fundamen¬
are
and
School
year.
terial
municipal
cooperating
Varying Scopes
The two studies
although the
will economic
magnitudes of exchange
you
cur-
was
impor-
minimum amount
a
data
questionnaries
relative
to provide
way as
and
of
foreign securities. The study will testing it
a
are
out
for
T
Mailed
aration
the
of
assem-
:
Being
questionnaires
being
be
the
dustry well in advance of the
in
presented
market, includand
of
simplifying the quesin making certain
tionnaires
January through March
will
mem-
The committee has
Included
study
will
cross-section
a
(which has been studied recently
the
has
year
preparation
elsewhere)
the
per¬
spent a great deal of time with
representatives from the Wharton
The
s e c u r
of
to
questionnaires
bers
organ¬
With the exception of the U. S.
of
and
cover
shortly be sent to all IBA
izational structure.
amine
of
of the
thJ
r„elme"Lbln.keKr-difficulties
of the investment bank¬
Government
the
investment banking
industry, its financial character¬
istics, and methods of financing,
all with historical perspective.
study.
We
for the
review
the
and
study
economic
sonnel
ng
the
of
new
including
The
the
the process of
scope
whole;
a
customers
etc.
then
defining
security
as
with
members that this very important
project will be no better than the
underwriting groups,
selling groups, and issuer and the
disposition of unsold securities,
that time that
pleti
as
well
as
familiar
in such
I
manager,
indicated at
com
of
ad¬
process.
price structure of the transactions;
consider the interrelationships of
had
were
type
types of firms
actions
been signed.
It
was
also
we
each
in
hoped that the desig¬
the data with
including
activity
in
outstanding issues, for different
characteristics of
them
period
of
made
were
material required prior to the end
of December and that he will be
able to set up the books of his
activity,
industry
and
contract
a
with
tance
It is
vance.
thoroughly
%
At
questionnaires
nated person in each firm will be
Ralph F. Leach, Vice-President and Treasurer of
the Morgan
Guaranty Trust Co., New York City, in
his position as Chairman
of the Research Commit¬
tee, informed the Convention of the
study of the
investment hanking business now in
progress via
a
grant of $150,000 by the IBA to the Wharton
School of Finance and Commerce
of the University
of Pennsylvania. Text of the Committee's Report
is as follows:
was
difficulty in isolating certain data
the
fact,
the
difficulties
were not
likely to occur if prep¬
arations
for
filling out the
after
4-0220
Sts.
Morristown,
jefferson
N.
J.
9-6700
■.
64
The Commercial and Financial Chronicle
California
Southern
Report of IBA Nuclear
Industry Committee
Dr.
Paul
been
plans for the con¬
struction of a 375,000 kw Westinghouse closed-cycle reactor at
Camp Pendleton on land belong¬
ing to the United States Marine
Corps. Joint usage of the plant
provides for 80% of the cost to
be borne by Southern California
Edison. This company would also
take 80% of the plant's produc¬
tion.
The
target
date for this
plant, which is also fully com¬
petitive and again without sub¬
The
present
enacted
F.
little
than
Atomic
in
Energy
August,
Act
1954,
seven
years
ago.
that
time,
San
t
broken
was
and
private
in¬
of
construction
with the second
dustry
capital
en¬
cost
tered
the
could
and
fully
are
of
be
field,
site.
financial
atomic
in its
peaceful
ap¬
plications has
mous
Dr. Paul F. Genachte
strides.
1962
produced
There will be
and
with
Economic
the
at
Breakthrough Apparent
By 1965
the
to
reduce
point
made
After
cific
on
16
Gas
from
or
the
from
other
source.
The utility company has
been unwilling to release a break¬
or
any
must be
economic
months
&
this
year,
of
the
The
AEC
6.7
load
factor,
has
85
estimated
rather
than
5.6
to
the
kilowatthour.
decisions
to
this cost is still competitive.
be
can
We
1965
study, Pa¬
Company of
Toward the middle of
their
and
in
heat
fluxes, im¬
savings
could
be
achieved. This approach is being
limitations
variations.
fuel
portant
Manufacturing companies such as
General
Electric,
Westinghouse, investigated.
These new developments have
Allis Chalmers, Babcock & Wil¬
cox,
North American Aviation, convinced your Committee that it
General Dynamics, Martin, Com¬ will be possible to have nuclear
bustion Engineering, and some of power plants that will be fully
our
most
prominent consultant competitive
with
conventional
firms as Stone & Webster, Bechtel power
in several areas
of the
and Ebasco Services are engaged United States by 1965.
in
this
global effort.
Ownership
Nuclear
of
Last May, at the
disclosed
its
by 1965
enriched
uranium,
about
when
will
cost
as
per
it may,
forward
about 1%
of the total
Fuels
time the AEC
Late
tion
may
ultimately
take five units of the above size.
due
The Yankee
year
or
installed capacity of
an
255,000 kw.
The company is al¬
ready considering a second re¬
actor at Indian
of
Point,
Peeks-
near
New York.
1962, the fast breeder reactor
the
Power
Reactor
Develop¬
ment
Company (Detroit Edison
and associated companies) should
be operational with a capacity of
about 100,000 kw.
In
1963, Philadelphia Electric
Company will complete a 40,000
kw closed-cycle, gas-cooled plant.
Dealers and Brokers in
Northern
and
the
States
Power
Carolinas
Company
Virginia Nu¬
-
clear Power Associates will
Public
Utility
*
Railroad
"
Industrial
Securities
New Jersey and General Market Municipal Bonds
Bank and Insurance Stocks
Mutual Funds Shares
plete
nuclear
Member
Philadelphia-Baltimore Stock Exchange
Boston Stock
Exchange (Associate)
Pittsburgh Stock Exchange (Associate)
com¬
with
plants
power
capacities of 62,000 and 17,000 kw,
respectively, in 1962.
Jersey Central Power & Light,
a
subsidiary of General Public
Utilities, is studying a possible
400,000 kw plant. And the list of
plants built, under construction,
or
planned goes on.
There has
truly been excellent progress this
year, at an even faster and more
significant rate than before.
The
Charles A. Taggart & Co., Inc.
importance
of
price reductions for
nitely have
Locust
Base
charge
On July 1 of this year, the base
charges
for
duced
by
uranium
were
by
re¬
highly enriched uranium,. 34% for
uranium
containing 1% of uranium-235, and by almost 40% for
uranium.
natural
in
these
base
possible
by
in
curred
based
pound of
production of nat¬
These
the
the AEC
under
from
charges
new
on
a
price of $8 per
natural uranium oxide,
which is
chase
made
costs in¬
price established by
its
domestic pur¬
the
for
program
period
April 1, 1962 to Dec. 31, 1966.
jump
use
about
to
9
(gross rate of return) for
private
utilities
carrying
their
inventories.
own
of
such
The
change
a
increase
in
the
effect
net
would
be
of
cost
watthour
The
more
first
or
an
nuclear
power of about one mill per
reduction
was
decreased
the
ural uranium.
are
The
charges
current 4%%
the
would
to 12%
Atomic
Energy
about 20%
for
the
Commission
that
mean
kilo¬
less.
reaction
utilities
of
favorable to the idea of pri¬
was
vate
ownership of atomic fuels*
However, the immediate switch¬
over to private ownership would
act
as
brake
a
the
on
growth
of
atomic
energy.
AEC
believes that there will
have
now
to
be
transition
a
perhaps 10
Therefore, the
years
or
period of
Over
more.
such
a
period, it is certain that
higher cost of atomic energy
resulting from private financing
Simultaneously,
however, the
charge rate on the inventory of
the
uranium
of fuel inventories would be more
in
from
creased
reactor
a
in¬
was
the
previous 4% to
%%. The theory behind this in¬
crease, in the words of the AEC,
4
that
was
the
the
to
money
since the rate
in
1954.
The
basis
in
S.
took
the
ac¬
of
cost
Government
first established
.
has
measures
mills
U.
was
combined
nuclear
rate
new
increases
of
count
fuel
per
effect
been
cost
to
these
of
reduce
from
.3
kilowatthour.
the
to
on
.6
the
of
present burn-ups.
This
significant step in the right
direction.
A company
recently
published the results of studies
of plutonium in so-called "near
was
a
thermal
reactors."
It
does
appear
that
unusually high burn-ups are
possible, which would cut the
than
offset
by other cost reduc¬
tions resulting from improved re¬
actor
technology
ductions
in
the
future
and
cost
of
re¬
uranium
oxide.
Congress has been very
security conscious and there is
telling when it may agree to
modify the Atomic Energy Act.
There may be a prolonged legis¬
no
lative
battle,
which
several years.
sition
AEC
include:
could
last
Some of the tran¬
suggested
measures
by the
the continued
leas¬
ing until a predetermined date of
purchase; purchase at an early
date with payment in
purchase
at
instalments;
early date with
an
deferment
through
of payment; purchase
bonds
or
bank
loans
Continued
on
page
91
pro¬
any other nation as exemplified
by the boiling water reactor, the
THOMAS & COMPANY
PORTER
Street, Philadelphia 2, Pa.
Teletype PH 677
Fuel
development than
BUILDING
PITTSBURGH
Published
KIngsley 6-0900
Nuclear
Charges
We defi¬
diversified
a more
gram of reactor
in
fact
one
cannot be overstressed.
Investment Securities
1516
Reduction
re¬
time,
this
with
In
site
plant would go on
new
early next
year, the large Consolidated Edi¬
son
plant will come into opera¬
nuclear
Bodega
in
or
now
should bring
the
costs
down to
the point at
which
the
plant will be fully
competitive.
kill,
at
last
kw
has
core,
least
we
have
to
135,000
performed beyond ex¬
pectations, both technically and
economically. Costs are estimated
to be 9 to 10 mills per kilowatthour or just about competitive in
this geographical area. A second
plant which
will be competitive.
This is in¬
deed an important breakthrough.
The
Pacific Gas & Electric
look
now
large
one
apparently reached
can
that
Be
90%.
mills
to
grounds alone.
Electric
and
at
the order of 12 to 15%
on
costs
nuclear plants
San Francisco
that goal.
nuclear
which
at
build large
reactor
lion kilowatts of nuclear capacity
of
actor
same
subsidy
no
contribution
costs, but we can sur¬
charges (gross
rate of return plus depreciation)
Nu¬
Today, atomic energy is not yet
competitive.
The main goal has
been
moderated
Even with the present re¬
technology and the existing
actor
began full power production at a
plant. The
that
power
down of its
Reactors:
clear
graphite
50%,
sodiumtne
organicreactor, the gas-cooled
the
reactor,
reactor,
level
the line in 1966.
the
mise that the fixed
Power
breeder
a program, we should
Atomic, which have approximately 1.5 to 2 mil¬
Electric
January, is
These costs
core.
competitive
government
enor¬
in
conventional
energy
made
the
cost of the nuclear fuel by almost
pressurized water reactor, the fast
With such
sidy, is 1965.
Yankee
Thursday, December 28, 1961
.
.
it also indi¬
thinking of em¬ installed capacity of utilities at cated its intention to advocate
for a
completed plant by 1965. barking on another plant with that time, since in 1965 the total that the 1954 Atomic Energy Act
Estimates of the cost of electric a capacity of 250,000 to 300,000 installed
capacity should be at be amended to permit
private
This ownership of enriched uranium.
energy generated at the bus-bars kw in about a year.
This decision least 200 million kilowatts.
is
a
are
5.6
mills per kilowatt-hour evidently results from the suc¬
very good start.
Changing
the
present
leasing
with the first core and 5.3 mills cessful
operation
of
the
first
policy
to
outright
sale
would
mo¬
nopoly
build
Francisco. Plans call for
start
govern-
m e n
to
boiling water reactor plant
Bodega Bay, 50 miles north of
at
when
the
decision
325,000 kilowatt General Elec¬
tric
more
Since
its
announced
a
a
in
Electric,
Genachte, Vice - President, Atomic
Energy, Chase Manhattan Bank, New York City,
again was Chairman of the Nuclear Industry Com-mittee and, in that capacity, presented the
follow¬
ing Report to the Convention.
was
has
Edison
joined by San Diego Gas &
.
Twice
New York Phone WOrth 4-7333
19,
PA.
Weekly
The COMMERCIAL and
FINANCIAL
Reg.
U.
WILLIAM B.
25
S.
DANA
Park
Place,
REctor
CLAUDE
WILLIAM
DEALERS
AND
UNDERWRITERS
COMMONWEALTH^OF; PENNSYLVANIA
and its Political Subdivisions
CITY
OF
I
>
'$
state
and
Other
J.
Securities
9576
SEIBERT,
Treasurer
MORRISSEY,
city
Editor
111.
3,
135
bank
news,
South
(Telephone
Copyright 1961
PHILADELPHIA BONDS
ESB
Salle
La
STate
St.,
2-0613).
by William B. Dana
Company
6
Reentered
second-class matter
as
Febru¬
ary
25, 1942, at the post office at New
York, N. Y., under the Act of March 8, 1879.
.»
Members
Subscription Rates
■
SCHAFFER, NECKER & CO.
Packard Bldg.,
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from
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Enterprise 6289
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year;
per
Underwrite"
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clearings,
etc.)
news,
Office:
Chicago
TURNPIKE, WATER AND SEWER ISSUES
E&»
Municipal and Corporate
Y.
SEIBERT, President
corporation
>
*
PENNSYLVANIA SCHOOL AUTHORITIES
w§m
N.
Thursday, December 28, 1961
records,
Specialists in,*
to
7,
Every Thursday (general news and ad¬
vertising issue) and every Monday (com¬
plete
statistical
issue—market
quotation
"X
Obligations of the
r
York
2-9570
D.
Office
COMPANY, Publishers
New
DANA
GEORGE
liteC
CHRONICLE
Patent
Other
Bank
$45.00
and
per
rate
foreign
must
be
Quotation
year.
Note—On
the
Publications
Record
(Foreign
account
of
—
in
exchange,
remittances
for
subscriptions
and
advertisements
in
New
York
Outlet.
Market^andR*^^^
extra).
fluctuations
of
made
<Ass0TL^.
--^^pal'securitie.
a
Monthly,
Postage
the
Pltuw/^°Exeh. (Awociate)
funds.
PLAZA BUILDING
Teletype —PG 469
•
PITTSBURGH
Telephone
—
19, PA.
GRant
1-1875
Volume
194
Number
6120
.
.
The Commercial and Financial Chronicle
.
Report of IBA Oil, Natural
Emery Katzenbach, II, partner White, Weld &
Co., New York City, and Chairman of the Oil and
Natural Gas Securities
Committee, submitted the
following Report to the Convention:
Petroleum
Oil
ulated
by i the
Chase
Bank
annually,
ther
increase
in
Manhattan
recorded
a
fur¬
earnings
1960
lion in 1958.
the
best
was
history,
when $3.0 bil¬
was
these
a
re-
L. E.
ferred
Katzenbach, II
com¬
Earnings in I960 afforded
10.0% return
and
on
net assets (pre¬
stocks
common
surplus), and
The rate of return
is
above
and
earnings.
As indi¬
return on domestic
foreign
cated
computed
as
composite of domestic
a
below,
investment
declined
from
1955
through 1958 and increased mod¬
estly thereafter. Return on for¬
eign
investment
has
declined
since
1955.
on
Investment
Domestic
30.2%
1960
8.8
13.8
low of
1960.
The
$4,241,000,000 in 1960.
in
spending has occurred abroad
although over the five-year pe¬
the
decline
in
will
financial
leum
1960
domestic
of
structure
industry.
petro¬
Cash earnings in
computed by the Chase
as
Manhattan
Bank
$6.17 billion
as
amounted
to
compared to $5.88
billion in 1959. The best year in
history
1957 when $6.32 bil¬
was
were
reported
cash
as
is
ex¬
probable that
a
established
be
new
earn¬
year.
record
1961
in
or
1962.
The
in
amount
of
flow
last
profitable than
in
1959, $1.50 billion was
distributed in 1960.
also
Working
increased,
rising.
cap¬
$320
a
value
the share far above the
high-
be
financed from
"stockholders
for Investment
Bankers
years
to
We have demonstrated that un¬
der current and foreseen condi¬
tions
the
within
the
supplied
Thus,
demand
for
industry
can
from
with
capital
be well
internal
the
sources.
exception
of
oc¬
casional public financing by large
oil companies to provide funds to
refinance short-
medium-term
or
debt; there is little prospect of in¬
vestment
bankers
having much
in the way of oil industry securi¬
ties to sell to the public. Equities
of small, more speculative oil se¬
curities
are
even
more
scarce.
The
most prevalent
the
next
type of fi¬
to
Oil
Corporation's
Standard
Oil
(Indiana) and Tidewater Oil Com¬
The total amount of capital
involved amounted to about $360
million,
of which $270 million
provided by privately placed
production
payments and about
$90 million of equity provided by
the two purchasers. The more re¬
proposed
sale
Corporation's
of
assets
flow
balance
is
the
investment banker
diser
of
oil
relatively minor
to remain
as
now
demand
of
Argo
to
likely
such
do
in
not
the
a
value
1957
1956
$2,294
$2,297
Refining/Chemicals
439
362
536
792
713
Other
606
562
564
690
614
$3,176
1,065
$3,037
1,229
$2,973
1,383
$3,776
1,677
$3,624
$4,241
$4,266
$4,356
$5,453
$4,988
Total
U.
S
Foreign
Total
SOURCE:
—
The
Chase
Manhattan
come
to
investment
the
1896
Pe.mngton, Colket & Co.
Members
York Stock
New
Exchange
American Stock Exchange
Philadelphia-Baltimore Stock Exchange
,
New
TRADING FACILITIES
deliveries
York
City
UNDERWRITERS
MUNICIPAL
by
123
South
New York
in
accepted
>
Philadelphia
AND DISTRIBUTORS
AND
Broad
or
CORPORATE
OF
BONDS
Street, Philadelphia 9, Pa.
PEnnypacker 5-7700
and
sums
Teletype PH 180
Manhasset
Altoona
Reading
Williamsport
DIRECT TELEPHONE CONNECTION TO
BAUMGARTNER, DOWNING & CO., BALTIMORE, MD.
PRIVATE TELEPHONES
of
BETWEEN
OFFICES
thought to
million
dol¬
therefore
attention
banking
of
com¬
munity.
Trading Markets
Many
producing
both listed and
Pennsylvania and General Market
sible
Municipal Bonds
High Grade Corporate Bonds and Stocks
companies,
unlisted, are pos¬
candidates
for
CORPORATE SECURITIES
liquidation
through a sale of assets to a
larger oil company. Reasons for
liquidation are numerous. Among
them
are:
the
MUNICIPAL and AUTHORITY BONDS
inability to increase
oil and gas reserves at reasonable
SCHMIDT, ROBERTS S PARKE
Members Philadelphia-Baltimore
123 South
N.
Y.
Stock Exchange
Broad Street, Philadelphia
(9), Pa.
Phila. Phone
Teletype
Phones
PH
REctor 2-1695
KIngsley 5-0650
538
HAnover 2-4556
cost;
inability to market
enough
incremental oil and gas each year
to permit an increase in net earn¬
RAMBO, CLOSE
&
the expense, and in some
the managerial problem of
expanding into refining and mar¬
keting to assure an outlet for oil
Incorporated
1518
Locust
Street
Philadelphia
DISTRIBUTORS OF
CORPORATE AND
MUNICIPAL
SECURITIES
EST. 1914
Boenning
THE ALISON
BUILDING
RITTENHOUSE
SQUARE
PHILADELPHIA 3,
Bell
System
Teletype PH 30
PA.
Telephone LOcust 8-0900
KERNER
ings;
cases,
production; aging managements
and failure to develop adequate
UNDERWRITERS AND
1,364
Bank.
Established
as¬
number
and
105
1958
by
some cases,
than
page
$1,873
transactions, a large num¬
properties changing hands
less
on
1959
Incoming
total
Continued
$2,113
COMPLETE
are
of
regulation fo producer
course, are
i960
purchase of Re¬
transactions
indus-
problems,
Oil
provided in cash
considerable
main
gas
$2,131
Production
proposed
A
The
problems
regulatory
many
confronting the natural
(Millions of Dollars)
United States:
Atlantic
only a few
hundred barrels of daily produc¬
tion.
with-
Capital Spending by Oil Industry
preliminary stage
involve, in
the
number of additional
a
In the
represent much smaller
up
try.
are
refining
in
out any significant clarification of
f"
we
upturn
Natural Gas
:
to
catches
Q
Another year has gone by
a
and is likely
one
meantime,
to witness
is
for several years
so
until
In the
merchan-
a
securities
produc-
^
those exposed
margins,
the role of the
consequence
exceed
to
increased
.
.
'
prospective
a
Aside from these substantial fi¬
ber
through
..
die capital expenditure programs,
public Natural Gas Company's as¬
sets by Socony Mobil Oil Com¬
nancial
continues
As
Refining Company is expected to
financed with over $100 mil¬
lion of production payments with
the
ings
han-
to
be
Atlantic.
and
rapidly rising demands
of the oil consuming public.
Under present day conditions, however, oil companies, w i t h few
exceptions, are generating more
than sufficient cash
equities
Opportunities for
capital gains may be found in
companies which are to be liquidated at a price in excess of the
current market; in those which
are adding to their base of earn-
the
meet
on
Company
pany.
cent
rising
raise
of outside
purchase
Honolulu
assets
to
facilities
expand
few
years) results
of producing
companies by large integrated
companies. The largest financing
of this type in 1961 was the sale
the
to
with capacity.
nancing undertaken by the oil in¬
dustry this year (and in prospect
from
capital
come
Financing Prospects
was
bankers
substantial amounts
come.
for
investment
oil
general, look forward to
dividend income as cash
internal needs.
several
cash
excess
of
jn
generation
for
can
duction payments; the remaining
requirements can usually
equity
Role
of
amount
be borrowed
by institutions in the form of pro-
traded in the public market.
Minor
substantial
a
capital, the bulk
of
involve
Underwriters
liqui-
earnings
lars
Retail Distributors
thereby achieve
quire
pres-
to
asubstantial improvement in
Socony.
only 17% as recently as 1956.
Compared with $1.47 billion dis¬
finally,
and
stockholders
acquisitions and mergers,
and
while such transactions may re-
During the 1950's the petroleum
industry called upon the services
paid
Div¬
compared
from
to
prepared
est price at which the shares have
Nev¬
dividends
to
ital
1961.
for $150 million plus the
sumption of certain debts
year
management;
sure
for
high
a
major oil companies.
cash
bursed
rea¬
new
1960 Saw
idend payments amounted to 23%
of
a
pany
year
the
out by
see
dustry earnings will surpass 1960
1962, stimulated by a rising
economy,
may
be
moderately
of
capital
the
we
management
the responsibilities of top
sonably good chance that 1961 in¬
be
spending combined with a mod¬
erately rising trend in current
cash earning power has further
strengthened the already strong
accom¬
The largest percentage decrease
riod
is
The downward trend in
will
panying table reveals a decline
from peak spending of $5,453,000,000 in 1957 (reflecting heavy con¬
cession purchases in Venezuela)
a
do¬
Record Earnings Forecast
It
Capital expenditures continued
to
continued
equalling its most profitable
17.3
7.2
1958
in
of the
may
level
ings.
Therefore, the petroleum
industry in 1960 came close to
Foreign
10.2%
1955
decline
1961
1960
activity.
lion
Return
to
in
the
virtually no in¬
crease
in total refining capacity
this year, nor is any measurable
amount
anticipated in the next
few years
again reflecting the
ample unused capacity in this
was
decade.
a
Well
plus,
the second con¬
secutive year to record an im¬
provement over the 9.5 % rate of
return in 1958, the lowest in more
than
exceed
level
There
ported by
panies.
drilled
wells
significant change in
a
patterns,
middle
assume
date and
the next few years, no construc¬
tion dates have been announced.
year
in
lion
been
outlays
anticipated for the
next two years at least. Although
plans have been announced by
three of the major oil companies
to construct major refineries in
By compari¬
1956
have
rising
surplus of crude oil, no
significant improvement over the
bil¬
son,
Lower
drilling activity declined from
58,160 wells in 1956 to a subse¬
but in view
re¬
$2.5
somewhat
mestic
ported in 1959
and
by
1960 compared to $180
1959.
ertheless, the existence of an ex¬
cess of both
refining capacity and
produceability seems to preclude
petrochemical facilities.
Total
$2.7
billion
for
expenditures
offset
somewhat
billion, a
slight gain
the
refinery
partly
weather
more
quent low of 46,751 wells in 1960.
in 1960 to $2.9
over
been
greater in dollar volume.
Industry
industry earnings, as meas¬
by the 32 oil companies tab¬
ured
has
in
and
L.
penditures
in
Barring
Gas Securities Committee
Trends in the Domestic
million
million
65
&
Co.
Members
Philadelphia-Baltimore Stock Exchange
111
BROADWAY
American Stock Exchange
NEW YORK CITY
Private
New
York
Telephone
6, N. Y.
COrtlandt 7-1200
2,
Pa.
66
The Commercial and Financial Chronicle
tical
Report of IBA State
Legislation Committee
Podesta, Partner, Cruttenden, Podesta &
Co., Chicago, as Chairman of the State Legislation
Committee, presented the following Report to the
the
commissioner
to deny regis¬
issue that he per¬
sonally dislikes. The old acts in
Indiana
any
included
Montana
and
"fair, just and equitable" provi¬
sions; but those provisions are
eliminated by the new acts.
bill
A
to
provide
complete
a
securities act embodying the
new
Uniform Act failed to pass in Wy¬
oming.
In
California,
bill to provide
a
the Uniform Act with
modi¬
some
fications
it
Robert A. Podesta
amount
The
of
worked
North Dakota
Connecticut
Oklahoma
Oregon
South Dakota
Indiana
South Carolina
adoption
Utah
Washington
Wisconsin
may
Securities
Acts
These
in¬
amendments
cluded
complete new securities
acts in the following four states,
air based
on
the
Uniform
the
(including
ex¬
tion must be filed with the Com¬
missioner with payment of a filing
fee of $10. The proof of exemption
State
Securities Act with modifications:
contain
statement
of the
Colorado
Montana
must
Indiana
South Carolina
grounds upon which exemption is
claimed and a declaration of which
The
new
not
pro¬
authority for the administra¬
tor to
deny registration on the
basis of the amount of underwrit¬
vide
or selling commissions or com¬
pensations.
(The present act in¬
ing
cludes; anti-fraud provisions and
requirements for the registration
of dealers, with an exemption from
dealer registration for firms which
national stock
members of a
are
acts in these four states
a
exemption is claimed. These filing
provisions for:
(a) the and fee
requirements in Arkansas
exemption for sales by have been
applied to securities
registered dealers in the secondary
and
transactions
which
were
market; (b) registration by noti¬ classed as
exempt in the Uniform
fication for securities meeting
Act
after
careful consideration.
specified requirements; and (c)
This Committee strongly opposes
registration by coordination for
such conditions on exemptions be¬
securities which are also regis¬
cause they, in effect, require reg¬
tered under the Federal Securities
Last
lished
"Primer
a
There has
cism
the
of
state
been
frequent criti¬
provisions in
securities
a
Maine
the
Jersey
tration
securities
if
added
was
this
year
Washington)
and
which
he
finds
provide for the appointment of
that the issue would not be
"fair,
State
just
or
equitable," because such
provision establishes
no
a
real stat-
utory standard and simply permits
Securities
to
(Kentucky, New
Advisory
a
Com¬
mittee.
We believe that such ad-
visory
committees
Primer
has
been
revised
the
and
available
useful
serve
in providing
purpose
a
prac-
EIGHTY-FIVE YEARS OF LEADERSHIP -1961
Attached
APPENDIX C is the statement
interesting develop¬
during the
year
organization of
has
revised
to
on
is
edition
real estate investment trusts. Gen¬
policy of the N. A. S. A. on
options and warrants with the
changes approved this year.
Some
states
statement of
warrants.
of it
or
do
on
use
it
as
This
Committee
of real
ex¬
the
law
tax
persons
effective in
;
'
in
,
'
Continued
mem¬
on
Securities
Presi¬
was
George
not
because
ments.
qualified in certain states
of blue sky law require¬
It was hoped that this in¬
formation
would be helpful
in
working with state securities ad¬
ministrators
problems encoun¬
in registering issues under
KAY, RICHARDS & CO
Partners
Nathan
H.
K.
Parker
Sheldon
William
C.
C.
Norman
Parker
J.
Baird
Edgar
Francis
R.
Burton
Ray
Williams
E.
Crist
Parker
UNDERWRITERS
IN
DISTRIBUTORS
CORPORATE AND
DEALERS
MUNICIPAL SECURITIES
Members
New York Stock
Exchange
American Stock Exchange (Assoc.)
tered
is
B
a
Street Floor
Union Trust
Telephone
Atlantic 1-3241
Bldg.
Bell
Pittsburgh 19, Pa.
Teletype PG'466
Butler, Erie, Meadville, New Castle, Uniontown, Warren
and
Washington, Pa.; Clarksburg, W. Ya.
on
state securities
APPENDIX
acts.
summary
of
some
Correspondents and Private Wire Systems,
Harris, Upham & Co., Gregory & Sons, A. E. Ames & Co., Limited
of the
principal
problems reported.
In
instances we believe that
many
amendments
or
recon¬
Hulme, Applegate
Humphrey, Inc.
&
Ill
Options and Warrants to
Underwriters
CORPORATE AND MUNICIPAL
Issues involving options or war¬
can be reg¬
rants to underwriters
in
all
conditions
are
states
if
Union
Trust
Building
SECURITIES
Pittsburgh 19, Pa.
specified
met in the terms of
the options or warrants.
★
★
★
The statement of
tions
the
policy on op¬
warrants
adopted by
and
North
American
Administrators
general
in
1946
assumption
Securities
created
that
a
Corporate Affiliate Glover & MacGregor, Inc.
options
Established 1914
warrants would be looked upon
with great disfavor in connection
with the application for registra¬
of
number
securities, and the state¬
policy was followed in a
of states. Under that pol¬
a few administrators refused
register any issues involving
options and warrants and in a few
states contended that where their
on
percentage limita¬
the amount of underwrit¬
ing commission it would be im¬
possible to determine whether the
percentage limitation was met un¬
til the options or warrants were
sold and the profit to the under¬
writer
Retail Distributors
Brokers
Underwriters
was
determined.
At
H. J. Steele & Co,
Members
Pittsburgh Stock Exchange
Philadelphia-Baltimore Stock Exchange (Assoc.)
Boston Stock Exchange (Assoc.)
the
Annual
Meeting of the N.A.S.A.
September, 1959 the adminis¬
trators approved guides in deter¬
mining whether the Jssuance of
stock options is justifiable under
the statement of policy, providing
that the statement of policy should
be given a liberal interpretation
as
to options or warrants issued
in
MOORE, LEONARD & LYNCH
MEMBERS:
New York Stock
Exchange
American
Stock
Exchange
Pittsburgh Stock Exchange
Union Trust Building, Pittsburgh 19, Pa.
Pittsburgh Telephone
Atlantic
1-0358
Teletype
PQ
391
New York Telephone
Dlgby
Direct Private Wire to New York, Greensburg, New
and Washington, Pa. Offices
9-3650
Kensington
es-
123
Pittsburgh Stock Exchange
Newton in a letter
to all IBA members requested in¬
formation regarding
each issue
managed since Jan. 1, 1961 which
tions
Corporate and Municipal
page
Philadelphia-Baltimore Stock Exchange (Assoc.)
In June of this year IBA
dent
laws provided
\
1961,
who invested in real
to
Underwriters—Distributors—Dealers
kinds
estate—apartments, hotels,
stores and others. Prior to a change
in
to
its appreciation to the
press
funds for investment in all
strictly.
wishes
estate
by which investors may pool their
options and
general guide.
a
real
investment trust is simply a means
Other states follow part
Some states follow it
the
speaking,
erally
the
follow
not
policy
now
request from the IBA.
icy
"
been
number of
a
Registration Problems
ment of
-
One of the
of
Survey of State Securities
tion
1877
the
n
or
can
must be nonexercisable.
IV
Estate Investment Trusts
Real
tion of state securities regulation.
istered
three states
authorizing
the commissioner to deny regis¬
of
be
exemption.
few
acts
should
policy.
or
ties Regulation." The Primer was
used widely as a simple explana¬
sideration of administrative prac¬
tice are indicated.
there
objective consideration of sugges¬
tions regarding the statement of
ments
as
their
for
warrant and to be made
at the time the option or warrant
is issued; and (3) to reduce from
one year to 11 months the period
in which the option or warrant
option
State Securi¬
on
corrective
where
12
and
overall step-up
an
during the year
open-minded and
them at meetings
20%, the step-up to commence
months after the grant of the
this Committee pub¬
year
include
istration
of
registered with the
SEC.; but it does not require reg¬
istration of securities.)
manual
Act of 1933.
fording representatives of the IBA
Committee an opportunity to dis¬
cuss the statement of policy with
a
nership;
exchange
pro¬
emption for nonissuer distribution
of
outstanding securities about
which
specified information is
available in a recognized securi¬
ties manual), a proof of exemp¬
the 23 states listed
summarized in APPEN¬
in
are
would
and
investors
to
that, hefore any security
be issued as an exempted se¬
transactions
The amendments to the securi¬
A.
marily to require full disclosure
reflect the important amendments
state securities acts this year
curity under six specified classes
of exempt securities and before
any transaction shall be executed
as
an
exempt transaction under
five specified classes of exempt
Montana
DIX
of
Act
Securities
part¬
underwriter is
the alternative
The
development is the
amendments to the
Committee of the N.A.S.A. for af¬
recommended
the Uniform State
Securities Act (with some modi¬
fications), to provide anti-fraud
provisions, requirements for the
registration of dealers and agents
and requirements for the registra¬
tion of nonexempt securities. The
security registration requirements
of the act would be designed pri¬
of
of the Options and Warrants
bers
assigned
be
underwriter
The committee has
visions
Missouri
above
this project.
in
Arkansas
Tennessee
acts
on
adverse
An
Michigan
ties
Great commenda¬
the
when
to
the
of
securities act.
a
to
Georgia
State
California
warrants
or
partners
new
a
Deplores Arkansas Yardsticks
Florida
Amendments to
adoption
tion is due all of those who have
Colorado
Maine
been
securities law.
New Mexico
New York
Kansas
toward
major project, which
would have made many desirable
improvements in the California
following 23 states:
Arkansas
work
the Uniform Act in
of
has
ments to the securities acts in the
Alaska
The
IBA.
amend¬
were
the
California Bar Association and the
activity
that there
fact
Commissioner,
Corporation
in state
legislation affecting the securities
industry this year is indicated in
the
failed to pass, although
endorsed by the California
was
tions
to
Thursday, December 28, 1961
.
.
(2) reducing from 10%
to 7% the required step-up in ex¬
ercise price each year, the option
or
warrant is outstanding, or in
adoption
Convention.
administrators
to
effecting sound regulation.
A noteworthy development oc¬
curred in Maryland, where Gov¬
ernor Tawes appointed a commit¬
tee to consider the desirability of
adoption of
Robert A.
tration of
assistance
in
.
Pennsylvania and General Market
Municipal Bonds
Corporate Bonds and Stocks
to underwriters in connection with
a
public offering if specified
ditions
At
are
the
N.A.S.A.
con¬
met.
Annual
this
1812 First National Bank
year,
three further
changes in the statement of policy
were approved: (1) permitting op-
Bldg.
Pittsburgh 22, Pa.
Meeting of the
GRant 1-3883
Teletype PG 381
Volume 194
Number 6120
.
.
The Commercial and Financial Chronicle
.
67
done by the aerospace indus¬
supersonic transport project. The
try for the full year should be proposed U. S. configuration would
slightly ahead of 1960. A moderate be a Mach 3 airplane, with a de¬
ness
Report of IBA Aviation
increase
Securities Committee
in
volume
place in 1962
should
take
the effects of the
Administration's increased
as
signed cruise speed of about 2,000
Mercury, first phase in this coun¬
try's efforts toward manned space
flight. Launch tests began this
fafl on the first stage of the huge
miles per hour and a range of ap¬
Saturn rocket, whose eight en¬
proximately 3,500 nautical miles. gines are designed to produce 1.5
budgets are Passenger capacity is expected to million pounds of thrust. One of
Edward J. Morehouse, Vice-President
more
of Harriman
fully
reflected.
Common be approximately the same as the most important space devel¬
shares of most of the aerospace that of the
Ripley & Co., Inc., New York City, as Chairman oj
larger models of to¬ opments in 1961 was approval by
the Aviation Securities
companies have risen in price this day's subsonic
jets. Propulsion Congress of the Administration's
Committee, delivered the
year.
,
system will probably be some request for an expanded effort in
following Report to the Convention:
The increased emphasis by the
form of a turbofan engine coupled the program for a landing on the
new
Administration on the lim¬ with
The Aviation Securities Commit¬
ramjet or other type of moon by 1970. While there re¬
marily engaged in defense busi¬ ited
war capabilities
of our de¬ auxiliary power to give the neces¬ mains some difference of opinion
tee
of the
Investment
Bankers ness, also have large stakes in the
fense posture indicates that the
Association hereby submits its re¬ aerospace
sary
thrust for acceleration to in Congress as to the ultimate
industry. The number decline in the relative
importance transonic speeds.
wisdom
of
port reviewing pertinent develop¬ of companies participating in the
spending
so
much
of manned aircraft may be
slowed,
ments within
Most
estimates
of
the
Free money on this program, neverthe¬
manufacturing
segment
of
the at least
temporarily.
In
addition
less
it
now
the
aviation
appears likely that the
aviation
World airline
new
defense
field has
industry
dur¬
ing
past
the
dously in recent
The
year.
The
dustry"
"in¬
with
reference
complex
field
the
a
is
extreme
international
operations of the non-sched¬
AEROSPACE
it
Net sales of the 12 largest aero¬
an
manufacturers
space
Edward J. Morehouse
simplification.
$5.5 billion
as
the space age has served to widen
even further the "boundaries of an
billion
the
already broad
comparable period
in
1960.
Year-to-year compari¬
sons
for
these
companies as a
group have been greatly distorted
in 1961 by the marked reduction
this year in the amount of losses
sustained by certain of the com¬
mercial transport manufacturers.
Generally speaking most of the
major aerospace companies have
been showing improved earnings
this year; profit margins on de¬
into
Aviation
in
recent
known
term,
of this report,
divide the avia¬
its
two
general
of manufacturing
categories
transport.
and
manufacturing, which
has come to be
years
the more appropriate
"aerospace" industry,
by
the
includes the
large air frame and
companies, the manufac¬
propulsion systems in¬
cluding jet, piston
and rocket
engines, the small plane manufac¬
missile
turers
turers
of
and
a
host
of
other
same
million in the
For the purposes
we may
compared with $5.2
period last
Net income of these com¬
panies totaled $43.5 million in the
1961 first half, up from only $8.4
economy.
field
in
year.
of the nation's
area
during the
aggregated about
first half of 1961
The advent of
tion
opera¬
uled and supplemental carriers.
over¬
however,
is
as
know
we
today
industry
tions, local service lines, all cargocarriers and helicopter lines, plus
that
as
aviation
of
in
engaged
to
diverse and
so
transport
comprised of the scheduled car¬
riers, including the domestic trunk
lines, United States flag carriers
of
use
the word
air
grown tremen¬
years.
narrow
the
in
com¬
tures
continued
business have
fense
levels however.
rate
year,
ground handling of air and space
A number of very large
commercial transport
corporations, which
what
lower
1961
that the
dicates
pri¬
not
are
expendi¬
during the second half of the
which will offset the some¬
panies whose products are utilized
in the manufacture, testing and
vehicles.
A step-up
defense
of
deliveries
volume
of busi-
Pennsylvania Issues
I
I
•••
.
Direct Private
Carl M.
Wire to
Loeb, Rhoades & Co., New York
Chaplin, McGuiness & Co.
w
\
Members
New
York
Stock
Exchange
Exchange
Pittsburgh Stock
Stock Exchange (Associate)
American
Philadelphia-Baltimore Stock Exchange
PEOPLES
Bell Teletype PG 473
Telephone GRant 1-3900
York
New
Office
—
(Associate)
PITTSBURGH 22, PA.
BANK BLDG.,
40
Wall
St.
—
substantial
a
number of other
WHitehall
3-4000
rise
in
orders
developments this
which should ensure the
continued prominence of manned
aircraft in the defense program
year
market for
a
super¬
sonic transport range between 100
and
200
aircraft.
Development
and production cost estimates for
a fleet of such aircraft
range from
$2.0 billion for 145 aircraft to
slightly over $4.0 billion for 220
aircraft.
The
unit cost
estimates
of
production models range from
$12.6 million to $20.0 million. The
tract awards were made earlier
wide range of these cost estimates
this year for the development of
reflects the fact that the basic
the C-141 aircraft, a large mili¬
assumptions made by the various
tary jet cargo transport from
manufacturers were not the same.
which, it is expected, civil ver¬
It is clear that the magnitude
sions may ultimately evolve. Con¬
of the program will require sub¬
tracts were also placed for the
stantial financial assistance by the
so-called
"tri-service"
VTOL
transport, a tilt wing configura¬ government. It is equally clear
that the government will expect
tion designed for vertical take-off
that as part of the program there
and landing, which may be the
must be developed a feasible plan
forerunner of a whole new family
of aircraft suitable for both mili¬ by which the government may re¬
capture some part of its invest¬
tary use and, possibly, for short
ment.
haul purposes in the commercial
for
the foreseeable future.
Other
market.
with
which
moved
cluded
those
Con¬
military programs
respect to
manned
ahead
in
aircraft
1961
relating to
an
vanced tactical
fighter and
observation helicopter.
a
in¬
ad¬
light
Fate of B-70 Program
The
Pentagon
recently
Space Program Accelerated
nation
will
billion
Evidence
expend
$20.0
some
lunar landing project.
on a
of
possible commercial
aspects of our space activities be¬
came faintly apparent this year,
particularly in the area of the
proposed communications satellites.
Deliveries
of
commercial jet
transports have been at a some¬
what slower pace this year, re¬
flecting delays experienced in the
Convair 990 program and, for sev¬
eral of the U. S. airlines, com¬
pletion of the initial phases of
their
jet
equipment
programs.
Several of the lines have placed
orders
for
the
short
medium
to
range Boeing 727 with deliveries
expected
1964.
to
in
commence
1963-
A
significant development
this
year
was
the penetration
made into the domestic market by
foreign manufacturers of turbinepowered aircraft.
One of the "Big
has in oper¬
The pace of our national space
activities quickened noticeably in
4" U. S. airlines
1961.
Two flights by U. S. Astro¬
nauts in May and July and an un¬
another
manned orbital flight in
ber
were
mileposts in
the all-cargo carriers now have in
Septem¬
ation
the
now
French
has
Caravelle
placed
order for this aircraft.
Project
Continued
Certain of
on
page
spend
by Congress to en¬
large the present program for the
supersonic B-70 bomber, a pro¬
gram which is designed to demon¬
strate the technical feasibility of
the aircraft and related subsys¬
tems rather than to develop a fullvoted
scale
weapon
sible
that
and
system.
UNDERWRITERS
It is pos¬
controversy over
other manned bomber
ultimate
DEALERS
—
Bank Stocks
again
Janu¬
Pennsylvania
the
DISTRIBUTORS
Corporate and Municipal Securities
the
programs
may be
raised
when Congress convenes in
—
fate
Ohio
—
—
of
the B-70 program, however, the
knowledge and experience relat¬
ing to large supersonic aircraft
West Virginia
A. E. MASTEN & COMPANY
gained from this and earlier pro¬
grams will be extremely helpful
in the proposed development of
a
commercial supersonic trans¬
Established 1891
MEMBERS
New
York
American
port. In June of this year a joint
report was issued by the Depart¬
ment
of
Defense, the National
Aeronautics and Space Adminis¬
tration and the Federal Aviation
FIRST
Stock
Stock
Exchange
Pittsburgh
Exchange
NATIONAL
(Associate)
BANK
Stock
Exchange
Wheeling Stock Exchange
BUILDING,
PITTSBURGH 22,
PA.
Telephone COurt 1-7300
Teletypes PG 568 (Corporate); PG 570 (Municipal)
Private Wire to Clark,
Agency, setting forth the conclu¬
sions that have been drawn and
Branches:
Dodge & Co., New York City
Wheeling, W. Va.; Butler, Pa.; Johnstown, Pa.
principles that have been
agreed upon in conferences with
representatives
guidance for
the development of such an air¬
craft. The report concluded that
the development of a commercial
supersonic transport is now tech¬
nically feasible and appears es¬
sential to the maintenance of this
country's leadership in commer¬
cial aviation. Our national prestige
is also at stake in this area. It is
known that the Soviets are work¬
ing furiously in this field and
they may succeed in putting a
supersonic airliner into service
before the U. S.
Whether they
will develop a true commercial
vehicle or, as they have done in
the
past, convert one of their
supersonic military aircraft re¬
various
in
Dealers
—
—
Distributors
Corporate and Municipal Securities
iAcKelvy % Company
UNION TRUST BUILDING
•
PITTSBURGH
MEMBERS
NEW
YORK
STOCK EXCHANGE
-
PITTSBURGH STOCK EXCHANGE
PHILADELPHIA-BALTIMORE STOCK EXCHANGE
AMERICAN
STOCK
BOSTON STOCK
EXCHANGE
(ASSOC.)
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EXCHANGE (ASSOC.)
TELEPHONE GR 1-8700
BRANCH OFFICE
BELL TELETYPE PG 587
CHARLER0I, PA.
Pershing & Co., N. Y. C.
industry
order to provide
mains to be seen.
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NEW YORK CITY
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REED,
LEAR & CO
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Members
New York Stock
Exchange
Pittsburgh Stock Exchange
Philadelphia-Baltimore Stock Exchange (Assoc.)
American Stock Exchange (Assoc.)
<
Current industry opinion seems
well beyond
1970 before a supersonic jet could
be
introduced
into commercial
service. Four study contracts, two
to
airframe manufacturers
and
to be that it will be
engine companies, are to
be let this fall.
The fiscal 1962
budget includes a provision of ap¬
proximately $11,000,000 for the
two
Private Wire to
95
an¬
the
Underwriters
and
sizable
a
nounced that it would not
funds
ary, 1962.
Whatever
Specializing in
space
placed for various tactical, recon¬
naissance and cargo aircraft by
the military there have been a
this
Brokers and Dealers in
-
of
aircraft, in¬
Corporate & Municipal Securities
Western
at
to
and
Branches
NEW YORK, N. Y.
BUTLER, PA.
CORRY, PA.
JOHNSTOWN, PA.
MEADVILLE, PA.
WARREN, PA.
WASHINGTON, PA.
\
•
pittsburgh
(AT. 1-0STS)
to
Bell
Teletypes—New York City: NY 1-1420
—
Pittsburgh: PG 482
REYNOLDS & CO. PRIVATE WIRE SYSTEM
68
The Commercial and Financial Chronicle
found
Report of IBA Industrial
shortages.
Securities Committee
J.
Victor
Loewi, President of Loewi & Co., Inc.,
Milwaukee, Wis., presented to the Convention, as
Chairman of the Industrial Securities Commitee, a
Report on the WATER TREATMENT INDUSTRY.
Committee's
The
Report,
encom¬
passing approximately 70 pages,
represents what is very likely the
exhaustive
most
detailed
and
analysis of the
and
current
conserve
as
as
It
Conversion
of sea water has
been successfully achieved for
many years.
During the war our
military and naval forces, both at
explores every
this
of
facet
vital
problem,
including new
developments
in
were
progress,
of
area
sa-
and
on remote Pacific islands,
supplied with fresh water
distilled from the sea. The prob¬
sea
particularly in
the
reuse
and conservation, control and re¬
plenishment of natural resources.
well
abroad.
natural
our
supplies by
United
States
and
research
fresh water
of waste water,
treatment of sewage and indus¬
trial waste, avoidance of pollution
prospective,
con fronting
many parts of
the
funds already avail¬
extend
tion
problem,
age
to
development work and construc¬
of additional pilot plants.
.Efforts are also under way to
short¬
water
able
J. Victor Loewi
<
lem
is
to
bring down costs to
economical
level.
an
To
further this
industry and
the
Government are spending
the role of the investment banker
many millions on development of
and investment opportunities in new methods and
approaches and
the area of increasing the supply
improvement
of
existing
proc¬
of water for individuals and in¬ esses.
Much
progress
has been
dustry. Reproduced herewith are made and in many parts of the
some
of
the
highlights of the world, including arid areas of our
own country,
Report.
millions of gallons
of distilled sea water or brackish
line
water
.
conversion,
companies
objective,
private
actively engaged in the industry,
INTRODUCTION
water
Much has been written and said
the
over
air
impending
recently
about
being taken to cope with this
increasingly critical problem.
are
Most
people, except those resid¬
in arid regions, are inclined
ing
to accept
the availability of water
unlimited
as
much
and
to
take
it
being supplied daily for
industry and human consumption.
the
water shortage in the
United States and about steps that
as
for granted as they do the
supplies of the air
However, this coun¬
inexhaustible
are
Water treatment and water
version
become
can
a
con¬
big industry
in coming years, and many com¬
panies will benefit therefrom.
The
object of this review is to
put the problem into focus, to out¬
line what is
try, like other parts of the world,
is gradually approaching the point
where the demand
essential to life and living
and seemingly so abun¬
available to most people
so
as
there
and
on
nonusable form
needed, to do
the rising
scale of accelerating need and at
Two Main
Sources
The two main sources of water
that
can
use
are
be developed for general
surface and underground.
and
snow
Under
the
underground reserves.
surface of the earth
are
important sources of water
found in glacial, alluvial or wind¬
blown
rials
deposits of granular mate¬
such
sand,
as
sandstone, solution
erns
fractures
or
gravel
and
passages, cav¬
of
rock, and
combinations of these consolidated
and unconsolidated
geological for¬
mations which are called aquifers.
This ground water originates from
accumulations during geologic
time. Water is replenished in these
formations by downward percola¬
tion
rain
of
waters.
In
and
some
ground reservoirs
on
at
a
are
surface
being drawn
lowering
replaced
of the
resulting
natural
in
a
water
table.
being directed
alleviating the impending water
crisis
through research directed
toward conversion of sea water
total
and
about 44%
municipal
and
accounts for the
use
re¬
The tremendous demands of in¬
dustry for water
that
are
indicated by
ton
one
of
news¬
print requires 240,000 gallons, one
pound of high grade paper 1,000
gallons, one ton of steel 65,000
gallons, one ton of synthetic rub¬
ber
660,000 gallons, one ton of
rayon 200,000 gallons, one gallon
of alcohol 236 gallons. Over 11,000
major U. S. firms now use a total
of
10-20
million
apiece, and
rapidly.
the
daily
rising
The natural fresh water supply
remains
usage
come
tain
constant.
Therefore as
increases shortages will be¬
widespread and severe. Cer¬
of the
areas
and
troubled
country that have
with
insufficient
deteriorating water supplies
of
the
and
from
lack
of
Scope of the Problem of Water
and
put to
Shortage
lost
are
participating
in
various phases of water treatment.
The remainder is
use.
through evaporation,
transpiration and in other
plant
accepted
which
Modern
fact in his day about
nothing could be done.
science, however, has
found methods to separate salt and
other impurities from water and
to
it
make
potable
or
Not
all
of
this
obtained.
billion
25%
The
gallons
all that is
U.
actually
S.
day is
this, we
at present
using about
billions gallons per day.
Water
Use
of
a
Of
are
otherwise
can
Dept.
of water
available.
ways.
323
their pressing
lems also exist in
this
country and abroad has been re¬
examined in the light of balloon¬
supplies,
and
it
has
been
It
is
1975
further
creased to 453
ent
estimated
requirements
use.
will
billion
This is based
that
have
It
might
by
gallons per
600 billion
on
expected
be
Lakes
fresh water
in¬
re¬
North
the
Central
Water prob¬
some areas
along
the East Coast of the U. S.
return
in
embrace
Montana and Texas.
able
time the whole
resources
and
The
suffering
homa, New Mexico, Arizona, Cali¬
fornia, Utah, Minnesota, Iowa,
North
Dakota, South Dakota,
terests
same
water
water
Southwestern
day and by 1980 to
ing demands and mounting wastes, gallons. By the year 2000 water
contamination and loss of avail-i needs
may have quadrupled pres¬
of
country
sections and the Gulf and Florida
Coasts. States involved are Okla¬
Great
Compounds
problems, but much
needs to be done.
more
thought
area
has
the
unlimited
availability. However,
this is not true because withdraw¬
als are subject to restrictions and
controls
electric
values.
necessary to protect in¬
such as shipping, hydro¬
generation
Nor
of
difficulty
the
can
property
replenishment by
waste
as
and
water
solve
the
pollution then enters
picture, and this is also
regu¬
lated.
In
Underwriters
and Distributors
General Market
of
has
adequate
in
natural
water
his
not
but
for
efforts
our
convert water from the
greatest, cheapest, natural
resources—the oceans—into water
consumption in the home
industry." Mr. Kennedy has
and
also expressed the conviction that
obtaining inexpensive fresh water
by saline conversion would dwarf
any
other scientific accomplish¬
ment
as
In
last
analysis the
oceans
the only unlimited v/ater
Fresh water from the
face of the earth and ground
source.
Through
evaporation
oceans
also
the
They
of
surface
of
some
330
contain
all
be¬
rainfall.
nearly three-quarters
cover
the
of
the
source
the
world
million
and
cubic
miles of water.
They also hold a
large amount of dissolved solidsenough
tally
to
an
to-
were
the
residue
Here then
inexhaustible supply of raw
material
There
the
out
the present land area
cover
depth of 500 feet.
a
is
that if they
so
distilled
would
for fresh water.
other approaches to
shortage problem.
are
water
Brackish
as
well
be converted
as
sea
to fresh.
water
can
Water
can
be conserved and reused.
Surface
and
underground supplies can be
pure
and recharged.
New
ground water supplies can be
kept
Water
can
be
Sewage
ways.
Rainfall
can
be controlled.
can
treated
be modified.
examine all of these
discuss
in
be
can
many
utilized.
We will
avenues
and
companies with activities
in these various
areas.
Approaches to the Problem
Expanding the Available Supply
It should be borne in mind that
all
water
withdrawn
for
use
Continued
on
page
E
tbank
COMPANY
by
84
o
our
Private Wire System
can
give
you
'MlflW,
Established in 1897
CHUSETTS
Members Boston and New York Stock
Member Federal Deposit Insurance Corporation
and American Stock
50
wa¬
oceans.
Municipal Bonds
Telephone: Richmond 2-4500
re¬
sur¬
ter returns to the
come
Teletype: BS 1680
Exchanges
Exchange (Associate)
CONGRESS STREET, BOSTON
Telephone: LAfayette 3-4832
Fall River
Winchester
Lowell
East Falmouth
v#;
benefit to mankind.
a
the
1957, 1,000 cities throughout
Through
■I:
fit for
In Coast-to-Coast Securities
MAIN OFFICE: 111 Franklin Street
to
economical
and
PRIMARY MARKETS
BOSTON
of
importance—
industry, agriculture and for do-
we
AND TRi
"No
is
only of our short¬
arid nations
the
effective
way to
world's
message
stated:
program
over—than
an
President
special
resources
long-range
relief
ages,
localities
own
ways.
resources
greater
for
their
of
Specialists in Bonds of Municipalities within Massachusetts
State S
in¬
become
sought
in
found. Pollution
that
Acts
matter
variety of
a
are
gallons
trend is
people
water.
supplies, and local bod¬
to improve the
have
situation
world
gions
which
many corpora¬
additional
find
Industry Demands Rising
verting sea water to fresh water
would constitute the greatest sci¬
At
ac¬
mainder.
useful. At the
age.
now consumes
facts
of
creasingly importunate as we rap¬
idly approach natural availability
in the rate of use.
Recognizing
this as a national problem, Con¬
gress has taken steps to provide
Kennedy
the
out
more
more
supplies
on
field
recently adjourned session of
user, now
for nearly 50% of the
By 1980 it may require twothirds of all water produced. Ag¬
and brackish water. The President
entific achievement of the
much
water
counting
recently stated that the discovery
of an inexpensive means of con¬
the
a
lakes, rivers and aquifers
theoretically can be collected
tions
of the
Commerce has estimated that 515
Much attention is
at
off into
it, and to summarize the activities
in this area
Ancient Mariner acknowledged an
to
'
110
135
204
312
453
have already had to resort to spe¬
cial measures
to
help alleviate
4,300
static, consumption would catch
up in two decades, but pollution
is rapidly eroding existing sources.
resources
upward
whole
The
total.
been
Rainfall in the U. S. is estimated
at
using much
Congress
66
92
that water usage
seen
when far
time
a
in
the under¬
faster rate than the water
be
can
other
areas
at
day)
40
increasingly heavy
the
15
experienced
drought.
Should this
happen again, it would take place
ies
domestic
and
persons
serious
rapid rate than population
growth. Industry has become an
of
be
the
be
surged
rivers, reservoirs which are re¬
plenished by rainfall, me.lting
famous lines from The Rime of the
water
has
riculture
remained
exceed
est-
can
Surface supplies came from lakes,
"Water, water everywhere, nor
any drop
to drink." Coleridge's
usable
1975
It
water
had to curtail
their normal water consumption.
Residents of Dallas, Texas paid 50
cents a gallon for drinking water.
100
every
a
more
cost that is not prohibitive.
a
1950
so on
for fresh water
supply.
If our
will
1930
1960
it is
as
forced to restrict
were
of
use
are
1910
either
per
76,000,000
92,000,000
106,000,000
123,000,000
132,000,000
150,000,000
180,000,000
235,000,000
1920
be used wherever
can
Population
1900
comes
one
of providing for ade¬
quate quantities of water in a state
in which it
been
(billion gal.
1940
The
has
the
In the 1930's the U. S.
Year—
readily ac¬
problem then be¬
cessible.
1900
Total
under
in
since
use
Water Use
not
or
usage
follows:
limitless
are
water
of
the nation
by industry es¬
pecially, agriculture, and for mu¬
nicipal and domestic purposes. The
growth in population and total
water
Yet
in
creases
dantly
actually threatens to become in
short supply in the form necessary
for human uses, even apart from
the numerous arid regions of the
amounts
Thursday, December 28, 1961
.
growth in population plus big in¬
processes
the surface of the earth
.
billion gallons per day
on
average with wide variations
across the country.
Of this total
perhaps 25% is available as run¬
being done to resolve
breathe.
we
That simple chemical compound
H20,
world.
Congress (Bill HR-7916) an addi¬
tional $75 million was appropri¬
ated to add to
that prompt steps must be
to avoid
alarming future
taken
.
Teletype BS-537
Haverhill
Manchester, N. H.
Milford
Hyannis
t
Volume
194
Number
6120
.
.
The Commercial and Financial Chronicle
.
BLEWER,
In Attendance at Convention
Securities
& Co.,
E.
'
BARKER,
S.
York
New
Dean
York
C.
Chisholm & Co., Savannah
Varnedoe,
AGEE, RUCKER*
Agee & Leach,
Sterne,
Birmingham
BARNETT,
First
National Bank,
Boston
New
Inc.,
Group,
J.
Street Bank & Trust Co.,
Boston
Columbus
Corporation, Boston
ALEXANDER, TED
M.
& Trust Company, Dallas
GUSTAVE A.*
Co;, New York
ALLEMAN, F. MONROE
The
Leedy, Wheeler & Alleman, Orlando
JAMES
H.
National
First
Bank,
City
New
York
Jones
Dow
Anderson
&
Co.,
HERBERT R.
Distributors Group, Inc.,
ANDERSON, ROBERT D.
THOMAS
ANGLIN,
Mackall
&
Jack
Coe,
ROBERT
ARNING,
M.
Bass
Raleigh
&
York
New
Inc.,
Nashville
WILSON*
Derbes, New Orleans
ARNSTEIN, Jr., FREDERIC A.*
Stix
&
Co., St. Louis
ARTHURS, ADDISON W.*
Arthurs, Lestrange & Co., Pittsburgh
AUCHINCLOSS, REGINALD L.
Courts & Co., New York
Arnold
&
E.
New
Russ
Hill
BACON,
E.
LEO
F.
&
&
BAIRD,
G.
&
PHILIP
White,
BANKER,
J.
Mr.
&
F.
York
San
Francisco
BISHOP,
Co.,
York
New
Chicago
York
Jenks,
Kirkland
New York
Angeles
Los
Angeles
Los
Angeles
C.,
Trust
Company,
York
D.*
&
SIDNEY
Janney,
York
Co.,
York
and Mrs.
E.
&
Clark,
W.
Philadelphia
BLEAKIE,
Cincinnati
S.
Battles
W.
E.
JOHN
Hutton
Barron's
M.
&
Co.,
Boston
York
Chicago
Carl
M.
Philadelphia
CLARK,
York
New
H.
York
:
Company.,
Chicago
CARRISON,
Pierce,
H.
Corp.,
Chicago
&
Co.,
Pittsburgh
Omaha
Co.,
New
ARTHUR A.
C.
Gardner,
III,
Savannah
&
WILLIAM
&
York
St.
Louis
L.
Day,
Times,
New
FORRESTER
Wainwright
GERALD
New
HAROLD
Boston
W.
Landstreet
&
Kirkpatrick,
JOHN
C.*
Bank
New
York
&
CLARK, JOSEPH F.
Municipal Finance
Trust
Company,
Chicago
New
York
Calvin
Association,
r
Bullock,
B.
CLARK,
Cleveland
Blunt
E.*
Chicago
Wulbern,
Ltd.,
-
ROBERT
Ellis
&
York
New
M.*
Simmons,
Chicago
CLARK, WILLIAM N.
Chicago Tribune, Chicago
CLARKE,
HARRISON*
Johnson,
Chicago
CLARKE,
GEORGE*
•
Officers
Chicago
Lane,
Space
JAMES
American
&
Co.,
Bank,
Chicago
Inc.,
Continued
-
Chicago
Atlanta
H.
National
on
page
F.*
Slocumb & Co., San Francisco
E.
Cleveland Plain Dealer,
Cleveland
BRYAN, JOHN F.*
Reynolds & Co., New York
BRYCE, T. JERROLD
Clark, Dodge & Co., New York
BUCHAN, ANDREW D.
Bacon, Whipple & Co., Chicago
BUECHLER, RICHARD K.
E.
F.
Hutton & Co., New York
Blair
York
JOHN
&
EDWIN
Co.,
New
A.
York
Underwriters & Dealers
in General
ations of
States and
les
Primary Markets in
Textiles
'4.(
40 Water Street, Boston
Industrials
Bank & Insurance Stocks
Area Code 617
New
TWX Boston 305
•
Utilities
6, Mass.
Telephone LAfayette 3-6800
England Electronic Securities
SCHIRMER, ATHERTON & CO
The National
Members New York and Boston Stock
Shawmut Bank
i
of Boston
<
:
50
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Exchanges
STREET, BOSTON 9, MASS.
TELEPHONES: New York
—
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—
7007
Enterprise 4280
Connections to Branches
Portland, Me.
.
York
Co.,
WILLIAM P.
Baker, Simonds & Co., Detroit
BROWNE, ALAN K.*
Bank
of America, San Francisco
BRYAN,
■
Boston
A.
&
BROWN,
BRUSH,
a
H.*
R.
CLARK, ROBERT E.*
Co.,
Carrison,
Co.,
Anthony
Wachovia
A.*
Jacksonville
Hutzler,
York
Co.,
Winston-Salem
Condon,
&
New
&
Nashville
A.
EDWARD
Nuveen
Firms,
M.
ALBERT
CLARK,
Toronto
Loeb, Rhoades & Co., New York
&
&
York
Clark,
H.*
Co.,
Co.,
C.
John
H.*
HOWARD*
FRANK
York
NEWELL*
Read
CLARK,
Journal,
&
Co.,
F.
Reinholdt
Association,
WALTER
J.
McDougal
CARR,
&
Tucker,
New
Corporation,
Street
CARPENTER,
&
York
PATRICK
Clark
Fahey,
CARLSON,
F.
Trust
Brothers
BUELTMAN,
ROBERT M.*
Weekly,
Wall
Exchange
EUGENE
Childs
CLARK,
CHARLES
New
Cleveland
MICHAEL*
Stock
CLAFLIN,
DAVID
Higginson
The
New
New
New
L.*
Boston
CARLETON,
Co.,
Bank,
Corp.,
FRANCIS
R.
Co.,
Brush,
S.
Hanover
BLACK, Jr., EUGENE R.*
Lazard Freres & Co.,
New
BLAKE,
Chicago
Lee
HARRY*
Salomon
RICHARD*
CHARLES
Northern
BROWN,
Los
&
CLAYTON
BROWN,
The
York
CAPEK,
F.
Dillon,
M.
IRVING
First
The
JAMES
Witter
York
Michigan Corp., New York
CANNON,
&
CHRISTOPHEL,
Bankers
CARBERRY,
Inc.,
New
New York
WILLIAM R.
&
York
B.
Exchange,
C.
Chiles-Schutz
J.
Gouinlock
ALGER
FRANK A.
Varnedoe, Chisholm & Co.,
CHRISTIE, ROBERT E.*
Co.,
Boston
New
CHISHOLM,
GORDON
of
Bell,
York
New
Company,
C.
Providence
Stieglitz,
First
of
Louisville
R.
CHILDS, J. MABON
Chaplin, McGuiness
CHILES, WARREN D.
York
E.
Manhattan
CALDWELL,
W.*
Co.,
York
Drexel
C.
E.*
&
R.
Reid
CHILDS,
Co.,
WILLIAM
&
New
York
New
H.*
Stock
CHARTERS,
Washington
CARL
BROWN,
Jr.,
CHAPMAN,
York
C.*
Co.,
THOMAS
Chase
CAMPBELL,
Co.,
New
Columbus
Hutton
E.
First
Hartford
&
York
New
Bank,
&
Jr.,
York
CHESTON,
&
CALLAWAY, Jr.,
York
York
New
G.
William Blair & Co.,
BROWER, A. BRUCE*
Dean
M.
&
Dickson
S.
BROPHY,
J.
Hurry
York
H.*
Co.,
W.
The
BROPHY, FRANK J.
R.
York
&
Co.,
Investment
Ltd.,
JOHN
Putnam
H *
&
Co.,
Bullock
BROOKS,
Minneapolis
New
&
&
CALVERT,
ROBERT R.
Nuveen & Co.,
Chicago
Wellington
Walter
Shores
Chicago
Jr., FREDERICK C.
Moseley & Co., New
Calvin
New
Miami
C.
New
Co.,
Co.,
B."
Montreal
Jr., JOHN
& Howard,
Fulton,
GORDON
CHARLES
Cady
York
New
CAFONE, THOMAS C.
CAHN,
BRITTEN, WILSON A.
Detroit
New
Co.,
Co.,
Manufacturers
S.
John
Walter & Hurry,
CHARLES C.
Street Sales, Inc.,
Bingham,
Angeles
DANIELS
&
CADY,
The
J.*
Co.,
&
Inc.,
Cleveland
&
Walker
H.
Lyons
CHAPMAN,
Assn.
Co.,
CADWGAN,
Halle
RICHARD
&
L.
CHAPIN,
G.*
Fenn
Commission,
Cassell
&
Co., Charlottesville
HENRY F.*
Keystone Company, Boston
New
City
EDMUND
CAHILL,
P.
Kindred
,
G.
BRINKER,
A.*
ALFRED
&
f
BRAUNS, ROBERT A. W.
Company,
CURTIS
BLEIBERG,
♦Denotes
BRAUN,
H.
ALVIN
William
Los
Weld & Co., New
HOWARD H.*
Devine
Evans
New
ALDEN*
National
Bank,
Hogle
;
Nashville
Co..
McKinnon,
&
BRASHLER,
McDonnell
Bingham,
New
ANDREW
BAKER,
A.
York
WHITNEY
Howard, Boston
BRASTED,
P.
Abbett
BINGHAM,
OMAR
Becker
Lord,
BINGHAM,
Co.,
Hallowell,
Sulzberger,
&
Co., Philadelphia
C.
Denver
M.
ROBERT
BAILEY,
A.
Co.,
B.*
Hutton
BERNDT,
BINGHAM,
ROBERT M.*
Co., San Antonio
Richards
York
BERGMANN, CHARLES L.
R. W. Pressprich & Co.,
J.
Antonio
&
BABICH,
York
Barcus,
New
ROBERT
BIANCHETTI,
EDWARD H.*
& Co., San
ROSCOE B.*
Cruttenden,
Podesta
AYERS,
AYRES,
New
ARNOLD*
Value Line Fund Distributors,
York
Austin
H.
Bank,
Philadelphia
Allison-Williams
First
New
&
EUGENE
W.
BYRNE, WILLIAM D.*
Phelps, Fenn & Co., New
S.
&
BRADY,
S.
Manley, Bennett & Co.,
BERGMAN, OSCAR M.*
The
Prescott
F.
Co.,
EUGENE
CHANDLER, JAMES
York
York
&
JOHN
Phelps,
C.
CATE,
C.
National
&
CASSELL,
B.*
Moseley
ROLLIN
BYRNE,
D.*
Co.,
&
S.
First
L.
Exchange
RODOLPHE
Casgrain
York
New
Sales,
PETERS
BUTLER,
Jr.,
Thomson
Co.,
BERGQUIST,
&
Bradford
C.
Eaton
Chicago
Company,
CHARLES R.*
Investor,
Jr.,
ELWOOD
Boynton
BRADLEY,
BERNHARD,
LOUIS
Shields & Co.,
AUER,
AUSTIN,
&
J.
Detroit
Co.,
States
BENTON,
A.
Co.,
D.
BRACEY,
Montreal
BENNETT, FRANK, S.
Cutter, Bennett & Co.,
L.*
Washington
York
&
CASGRAIN,
Nashville
Eaton
New
Newark
D.
Allyn & Co., Chicago
Jr., JAMES D.
Allyn & Co., New York
C.
The
Street
R.
BUSH,
New
Co., New York
CLYDE A.
-Strudwick, Richmond
BRADFORD, Jr., JAMES C.
Louis
E.
Brothers,
&
F.
B.
York
New
E.
BEIL, Jr., FREDERIC C.*
Beii & Hough, St. Petersburg
BELL, GEORGE deB.
United
BURR,
& Sons,
Baltimore
RAYMOND*
Parker & Redpath,
J.
Anderson
Co.,
BERTRAM
BENNETT,
for
York
Bank,
York
F.
Co.,
&
C.
A.
Louisville
Co.,
EDWARD
William
Bank
MEREDITH
BOYNTON,
S.
Manhattan
Chase
Drexel
York
New
H.
ARNOLD,
St.
Sons,
&
Collins
JOHN
Lehman
Richmond
ANDERSON,
Group,
Julien
BEHRENS,
GLENN E.*
Securities Corporation,
Distributors
&
ANDREW
Watling, Lerchen &
BEDE, ALAN H.
The
York
New
GEORGE W.
& Strudwick,
ANDERSON,
Carolina
York
New
FLOYD
Beaubien
BEEBE,
ALBERT A.
ANASTASIA,
ANDERSON,
York
New
BURR,
BOYNTON, THOMAS W.
Ladenburg, Thalmann &
Edwards
G.
;.v
Co.,
Atlanta
Co.,
DOUGLAS
CASEY,
York
New
EDWARD
&
&
HUGH
WILLIAM
CASEY,
A.
Co.*
LOGAN,
&
Co., New
JAMES
Blyth
,v
&
II,
&
Securities
Cleveland
I. W.
Co., New
Eberstadt
BURNS,
Garrett
BOYCE,
BECHTEL, CHARLES C.
Street
William
Beane,
York
G.
New
Manhattan
II,
W.
Carroll
Jr.,
Washington
Co.,
Brothers,
Burnham
F.
v'-'
►
&
J.
Hutton
E.
BURNS,
Auchincloss,
Carl
L.
Savings Bank, New York
&
EDWARD S.*
Sales, Inc.,
AMAZEEN,
&
Portland
Minneapolis
FRANCIS
C.
Robert
Milwaukee
C.
New
BEAUBIEN,
E. J.*
Trust
Harris
Williston
Co.,
CARY,
E.
BURKHOLDER, H. FRANK
Equitable
Securities
Corp.,
BURKHOLDER, III, J. R.
BURNHAM,
.
Rico,
BOYCE,
F.*
RICHARD N.*
M. Loeb, Rhoades & Co.,
A.
C.
ALMON,
ALTGELT,
R.
Nashville
W.
Jr.,
Almstedt
York
Chase
Witter
LEE
W.
Courts
Philadelphia
NORMAN
BURKE,
B.
&
Lee
York
New
CARTER,
Hayden, Miller &
BURKE,
JEROME
Dean
BOWEN, FRANCIS*
Government
Development
The
Company,
Association,
BORKLAND, Jr., ERNEST W.
Tucker, Anthony & R. L. Day,
Puerto
Co.,
Sun,
Stifel, Nicolaus & Co., St. Louis
BURDEN,
York
TOM
West,
BOWMAN,
&
CARROLL,
&
F.
BUNN, JOHN W.
Philadelphia
Co.,
E.
WILLIAM
R.
JOHN
Jr.,
Bioren
W.
Bankers
Witter
New
Chicago
Co.,
ALPHEUS
BEATTY,
JOHN W.
Allyn & Co., Chicago
TAYLOR B.*
Almon & McKinney,
Dallas
ALLYN,
A.
J.
JOHN
Milwaukee
BEATY,
York
New
M.
&
Cleveland
H.
&
ERWIN
New
Dean
York
Co.,
Bass
BAUMANN,
BEANE,
&
&
JACK
M.
Walston
New
Bank,
Commercial
GILBERT*
Vick
Jr.,
Jack
R.
Co.,
BOONE,
BORIG11T,
New York
CLARENCE W.*
Co.,
City
Biddle
HAROLD
World-Telegram
Stone & Co., New York
BOGARDUS, ALLAN
Watling, Lerchen & Co., New York
BOGERT, Jr., H. LAWRENCE,*
Eastman
Dillon, Union Securities &
RUSSELL*
&
Louis
BUNN,
Washington
BOESEL, RICHARD
Stieglitz,
&
B.
BASS,
ALEXISSON,
ALLEN,
York
Beane,
RAYMOND T.
&
BASNIK,
:■,!
Winnipeg
Bank
Texas
I
New
Co., New York
GEORGE E.
City. Bank, New York
Williston
Drexel
ALEXANDER, NORMAN J.
James Richardson & Sons,
W.
BARTOW,
GEORGE D.
Parker
The
R.
Halle
The Ohio Company,
Jr.,
BARTKUS,
ALBIN, JOHN
ALDRICH,
Co.,
BUNCE,
St.
Hayden,
Barrow, Leary & Co., Shreveport
BARTELS, STANLEY L.
York
AHEARN, JOHN W.*
State
&
National
BARROW,
AHBE, JOHN L.
Distributors
Childs
York
BARNES, WENDELL B.
Shearson, Hammill &
AGNEW, JOHN W.*
The First
F.
&
F.
Co.,
B.
WARREN
BOEHMLER,
Investment
York
New
Co., New
DONALD E.*
BARNES,
ADLER, LEOPOLD II
York
W.
Company,
HAROLD D.
Witter
New
&
National
Yarnall,
Corp.,
Trust
BARNARD,
F. Hutton <& Co., New
N.*
Securities
ROBERT
Irving
TED F. G.
ADAIR,
WILLIAM
American
h
•
ABRAMS, JAMES
Allen
BANNARD,
Corporation,
Charlotte
The
Glynn
ROBERT
BODMAN,
ABERNETHY, Jr., R. S.*
Interstate
CLARENCE
Blewer,
BLYTH,
69
-
Manchester, N.H.
-
Lynn and Northampton, Mass.
114
The Commercial and Financial Chronicle
70
interest
Report of IBA Federal
who
Withholding
Maynard, Partner in Shearson, Hammill &
Co., New York City, again headed the Federal
t Taxation Committee. Its Report follows:
activity this
began
year
on
20 when President Ken¬
nedy sent a Tax Message to Con¬
gress. This message first alluded
to the problem;
of long-range
tax
said
the
Secretary
of
u
directed
to
undertake
the
of
session
Congress
this
and
to
Walter
begin
next
January. The
message
of
Maynard
then advanced
number
a
for interim action.
The Ways and Means Committee
began
concluded
were
May. Finally, on
Wilbur
man
on
hearings, which
by the end of
Aug. 23, Chair¬
Mills
the
of
Ways
Committee announced
and Means
behalf of the Democratic
of the
bers
his
was
proposal
to
nesses
which
program
to grant
funds for modernization.
Committee has worked
President's
the
mendations
for
now
to
.
The
.
tax
recom¬
can
report to the
have
print of the 'discus¬
(of the legislation) will
It is stressed
be made available
a
if
and,
marked effect
omy, We
should
with
attention.
as
its
progress
scheme,
credit
investment
first proposed by the
Adminis¬
tax credit
tration, provided for a
of
15%
of
all new plant
and
equipment expenditures in excess
of current
depreciation allowances.
discussion
The
rate
a
20%
advocated in the President's
mes¬
compared
Your
sage.
that,
believes
Committee
although
the argument for
billion of interest and
$3
some
income
each year, our
continue
ing
with
of
the
Association should
resist
to
proposal
unreported
goes
the
the
on
withhold¬
deal of trouble to obtain
refund
a
where,
in effect, no tax is due;
(b) the clerical burden on corpo¬
ration
diaries would
(c)
steps
already
underway
processing
should
Revenue
and
enormous,
data
a
which
ternal
be
are
install
to
tem
interme¬
financial
and
allow
Service
under-reporting
and
sys¬
the
detect
to
the
problem without the drastic with¬
connection
with
draft
referred
the
(a),
of the qualified
more
liability in
investment,
than half of the tax
of $100,000. It
excess
not
may
less
amounts
ates
be
than
filed
for
$10. This
cre¬
obvious injustice for those
able to afford the tax and
an
least
for
those
just beginning to
it
moreover
will
the practice of
Dividend
not
save;
encourage
thrift.
Credit
Finally, and
significance to
is
the
be
seen
that legislation
President's
mended
your
tax
message
Other
however,
segments
of
in
sued
by
study draft is¬
the
committee. For ex¬
the
tax
deferral
veloped
privileges
countries
completely.
was
in
de¬
dropped
Possibly,
should not take too
we
much satisfaction in this develop¬
received rough ment, because in
dent's tax message
treatment
Presi¬
the
speech earlier
a
this month Professor Stanley Sur¬
Assistant Secretary of the
Treasury in charge of tax policy,
again urged repeal of the divi¬
rey,
dend
tax
credit
exclusion
and
efforts in the
con¬
cluding phase of the Congression¬
al session to attach a repealer of
the
dividend
clusion
to
tax
credit
various
items
and
of
tax
of
in
is
ex¬
legis¬
too
it
that
revenues
production. The logic of this
principle would call for taxes in
than
is
capable of producing, and that in
any event the high rate of tax is
a
grave deterrent to the mobil¬
ity
views
source
turesome
we
the
of
capital
economic
gains
tax,
sized
that
it
potential
should be
number
called
has
of
areas
Emmons
are
Blair
the
New
John
advocated
the soplan.
real
and
treatment
actions
including
estate, the
assets,
capital
granted
now
in
F.
same
to
within
made
New
Pershing & Co.
York, N. Y.
New
12
Albert O. Foster
Punitive
Personal
Income
Harris, Upham & Co.
Seattle, Wash.
Tax
Rates
■
.t
James
Also, looking ahead to the Ad¬
ministration's
promised
W.
program
reform, we shouldL continue
to urge that the maximum rate of
income
personal
tax
levels
to
be
W. C. Langley &
not
are
New York, N.
punitive. A rate higher than 50%
creates
a
greater incentive for
Spear, Leeds & Kellogg
New
We
effort.
believe,
therefore, that the maximum rate
both
income
corporate
and
50%
should
tax
level.
of income
provision
averaging
allowed.
be
would
be
Howard, Weil, Labouisse,
Friedrichs & Co.
This
helpful
to
and
New
to
Dominick & Dominick
and
these
efforts
will which suffer from wide fluctua¬
doubtless be renewed at the next tions in income such as
ours.
An
In
Coffin & Burr
NEW
boston
this
YORK
greatest
hartford
portland
their
amount
Boston
American
from
and
Administration
an
taxation of savings and loan asso¬
ciations.
Stock Exchange
The Chairman of your Commit¬
Stock Exchange
Midwest
mail
of
tee appeared before the
Stock Exchange
Stock Exchange
Means
(Associate)
Committee
Ways and
and
of
IBA
and
Boston
Exchange
Stock
Exchanges
(Associate)
taxation
The
continue
the
of
basic
dividend
is
measure
of
the
continues
any
to
suffer
a
not imposed on
other form of income in that
penalty
corporate
income
—first
the
in
poration,
and
by the
ceived
of
(the
is
taxed
hands
of
the
twice
income
LEWISTON, ME
BANGOR, ME.
GREENFIELD, MASS.
PORTLAND, ME.
LAWRENCE, MASS.
Baker, Simonds & Co., Inc.
Detroit, Mich.
in
Jack
varying installments.
Finally,
the
we
should
fact
unpleasant
chronic
face
up
that
T.
Stephens
Stephens, Inc.
Little Rock, Ark.
Longer Term Considerations
1
J.
Richard
to
Stern
Stern Brothers & Co.
the
Kansas
inability of governments,
second when re¬
stockholder in the
dividends.
in
the
that
of
the
within
An
lowest
I
U.
City, Mo.
Frederick W. Straus
S.,
to
Straus, Blosser & McDowell
Chicago, 111.
incomes
UNDERWRITERS
increase
•
DISTRIBUTORS
1
I
•
DEALERS
.
.
■
Members
Midwest Stock
■
Exchange
American Stock
■
I
Q
cor¬
Canadian rate) would have
logic of eliminating double
taxation
^
received
in¬
situation
present
despite the minor
relief
provided by
the
AUGUSTA, ME.
a
same
to
that,
form
Street, Boston 5, Mass.
income
pays
the
need
in the dividend tax credit to 20%
30 State
than
Committee
your
should
advocate
fair
severe
Stock
of
tax
Clayton Securities Corporation
belief
the
holder
York
amount
Ralph W. Simonds
installments
of
rate
■
the
It
4%
dividend tax credit and the $50
exclusion, the corporate stock¬
New
annual
expenses
come.
American
lower
including
for
1887
Branch, Cabell & Co.
Richmond, Va.
in
keep
actively
Members
even
received
dividend credit and exclusion.
is
Townsend, Dabney & Tyson
that income
fact
presented
testimony opposing repeal of the
that
Established
the
York, N. Y.
Roderick D. Moore
the basic inequity that arises from
proposal to change the method of
Members
York
of in¬
repeal of the dividend
were
credit
New
is
constituents during the ses¬
sion
New
averaging provision would reduce
connection, it
terest, however, that members of
Congress report that the two sub¬
jects on which they received the
Orleans, La.
James K. Miller
businesses
lation,
Congressional session.
Co.
John P. Labouisse
reasonable time
a
business
Kirkpatrick-Pettis
Omaha, Neb.
the
at
York, N. Y.
Stewart R. Kirkpatrick
personal
set
Moreover,
over
period should
small
be
Co.
Y.
James C. Kellogg III
tax avoidance than for additional
constructive
Jr.
Maitland T. Ijams
brought
which
Hutton,
M.
E. Hutton & Co.
Cincinnati, Ohio
of tax
for
York, N. Y.
Edwin D. Etherington
months.
down
Cooper
S. Smithers & Co.
trans¬
where capital
not payable if full
is
G. Butler
Walter W.
secu¬
homes,
are
Co., Inc.
York, N. Y.
Prescott, Shepard & Co., Inc.
Cleveland, Ohio
years
This would accord to transactions
in
Bryant
&
exam¬
reinvestment
full
Chairman
Shearson, Hammill & Co.
New York, N. Y.
empha¬
other
are
industry
our
a
TAXATION
COMMITTEE
capital
matter of rate reform. For
for
if
Walter Maynard,
the
reform Which
important than
more
ple,
Respectfully submitted,
world
our
with
there
forcefully as pos¬
representatives in
FEDERAL
leadership.
connection
In
as
his
to
Congress.
ven¬
needed
most
on
sible
huge
a
of
kind
maintain
to
are
of
provide
would
and
new
use
to make our
all of the foregoing sub¬
jects known
-
Association
the
opportunity
every
ing of the rate of the tax would
ease
the
"locked
in"
situation,
would
produce
substantially
greater revenues for the Treas¬
ury,
of
member
lower¬
a
t
emphasizes
important that each
is
it
that
final domestic sales
services,
Committee
Your
in world trade.
convinced that
on
of goods and
capital, and therefore in¬
appropriate for a country which
must
not
only grow but
also
maintain its competitive position
are
form
some
of
We
view of the
dustry
maximum
the
lead
additional taxes be imposed.
necessity that in¬
in the U. S. increase its
ability to compete in world mar¬
kets, we think it essential that
such taxes, if and when adopted,
be levied on consumption rather
In
eco¬
an
much
—
moreover, the "liberal" members
of the Senate Finance Committee
This proposal was of continued their
that
produce
to
amount
recom¬
repeal of the present 4%
repealer.
medicine indeed!
is
the
reinvestment
which dividend tax
credit and the $50
contains the possibility °f a 50%
exclusion, the study draft of the
corporate
tax
cut is powerful bill omits the
can
high
gains taxes
Exclusion
and
possibly of most
Association,
that, although the
fact
here
sense
within the predictable
to
the requirement
well
future
that
capital gains tax. Our con¬
tention
nomic
rities
to
credit
above set the amount of the
claims
may
in
even
holding remedy.
In
upon our Representa¬
Congress, and upon the
community at large, the need forbasic reform in an area of pri¬
mary interest to our Association
In¬
solve
Thursday, December 28, 1961 y
.
.
impress
tives
that
ground
(a) it would cause many persons
to pay tax and go through a great
on our econ¬
follow
ship
The
in¬
source on
believe that the member¬ study draft provides that refund
ample, the proposal to eliminate
early February, 1962..
A Committee
sion' draft
It is hoped that
...
Committee
House by
would
its deliberation
weeks that remain in
this session.
enacted,
but not
four months,
conclude
in the few
the
.
Ways
is far-
their
diligently
the
before
Committee. Neverthe¬
less, because the proposal
at 8%
and
finds that it will be impos¬
sible
"investment
the
as
connection
Means
busi¬
invest
would
tax
a
American
those
credit
on
mem¬
Committee that "The
the President's
of
heart
to
reaching
proposals
promptly
expansion," in the
frequently
message,
and
to
—the
dividends at
and
dividend
The "tax incentive for modern¬
which
is
Means and
and
scheme," is in effect a cut
corporate income tax rate,
available
to
corporations
in a
position to make expenditures for
new
plant and equipment in ex¬
cess of depreciation reserves. This
proposal is not of primary interest
to
our
members, and therefore,
your Committee did not appear in
program to be
placed,, before
the
was
approved by the Committee."
and
or
study bill does, however,
a provision for withhold¬
16%%,
credit
reform
tax
terest
part of the draft has been
no
affiliates
of Interest
ing of income tax at
in the
preparation of
a
that
draft
contain
of the Com¬
use
Ways
on
referred
was
y
mittee
President's
that
Treas-
the
r
'discussion'
this
ization
reform,
and
that
prepared for the
members
our
Dividends
The
Walter
April
of
subsidiaries.
Taxation Committee
Tax
to those
operate foreign
.
—
Boston Stock Exchange
Exchange (Assoc.)
H
■
147 MILK STREET,
BOSTON 9, MASS.
personal
Teletype BS-30
Telephone HUbbard 2-6065
bracket.
FITCHBURG, MASS
KEENE, N. H.
Capital
Gains Tax
Reform
I
I
Portland, Maine
Looking ahead to the next Con¬
gressional session, we should con¬
tinue
to
take
every
opportunity
Direct
■
Telephone to New York
—
CAnal 6-8447
a
Volume
194
Number 6120
.
.
The Commercial and, Financial Chronicle
.
71
Educational Committee Report
being made to syndicate
to channels in other
cities throughout the country.
Frederic C. Beil, Jr.
Northern
H. Lawrence Bogert, Jr.
are
now
the
program
Ohio
in
tion
Group
Junior
Participa-
Beil & Hough, Inc.
St. Petersburg, Fla.
Achievement
Eastman
In
raising drive this past
spring the Group raised approxi¬
mately
$1,100
for
Achievement
In
land.
ship
was
the
Junior
in
Cleve¬
program
addition
$350 scholarestablished to be awarded
annually
a
to
outstanding
Achiever of the year. The Group
publicizes the public offering of
stock in J. A, companies being
formed
5%
of
in
the fall
all
stock
and
purchases
by such
offered
Participation in the
J. A. program by the investment
fraternity will help promote the
private enterprise system among
high school students.
IBA
section
F. S. Smithers & Co.
San Francisco, Calif.
the
IBA
members
planning
own
programs
or
and
two
issues
the
of
IBA
Educational
Bulletin
published
during
1961,
September
participated
in
of the following pro¬
pages), and December (68 pages), constitute in essence the report of the Education Com¬
mittee.
They present in text and pictures a record of the educational, public relations
and promotional activities of the national Education Committee, the 17 Group Education
Committees
the United
in
States, and like activities
on
Robert W. Baird & Co., Inc.
New York, N. Y.
fipftrirp
Radio
and
Formal
courses
Television
internal
and Fo¬
Cooperation
the IBA Education Committee-and
in
the Department of Member Firms
methods within the securities bus-
during 1961 than ever before, re-
Liaison of the New York Stock
Exchange jointly sponsored a concentrated summer training program of two courses for trainees
iness.
Greater emphasis is being
placed on proper selection and
adequate training than ever before. The Committee is planning
in the securities business:
to
Robert
ported
of
Fiftieth
the
Mason, Chairman
Committee, at
Education
the
of
the
IBA
Investment
Bankers
ciation of America.
with
ner
Convention
Annual
Asso-
Mr. Mason
is
Merrill Lynch, Pierce, Fenand
Smith Incorporated, of
Chicago.
review
A
Com-
of the
mittee's educational activities
was
contained in the December issue of
Funda-
mentals
of
Investment
Banking
and Stock Exchange Operations.
The program was offered in cooperation with Northwestern University in Evanston, 111. 79 registrants
completed the course in
the IBA Educational Bulletin dis-
Fundamentals
tributed
Banking and 85 completed the
Stock Exchange Operations course.
There were a total of 101 registrants representing 55 organizations in the securities business
to
delegates. (This, together with the September issue
of
the
sence
Bulletin, constitutes
the
annual
report
in
es-
the
for
Education Committee.)
from
During the week of March 2631, a total of 274 junior officers
and partners of IBA member orMnW.inn« attended
ottondprt th* ninth onganizations
the ninth an
nual
session
Investment
of
Institute
the
of
record
Banking
enrollment for the three
_
by the IBA Education Committee
cooperation with the Wharton
in
School of Finance and Commerce.
was
graduating
also
From
a
in
R.dl iesT^d
24
states
and
s d Record
class
of
77
men
record.
July
30
to
September
2,
selection
the
use
data
and
pro-
compiled
as
the
with
schools
and
basis for a "Training Standard
Guide" for the use of all members
in establishing standards for training sales personnel, to encourage
comprehensive and effective training, methods, and to set forth typical entrance requirements for applicants for sales positions.
Central
States
Gr0
Television
Sam B.
,0
.
,
.
.
Thomas A. Melody
Merrill, Turben & Co., Inc.
Cleveland, Ohio
Bernard
Chicago
^
Jan.
Major IBA
Group Activities
Significant
educational
activi-
Jjes conducted by IBA Groups
throughout the country were re-
over
from
Station WGN in
5:30 to 6:00 p.m.
throPugh
several
popular programs
channels, the Forum has
ence
Rauscher, Pierce & Co., Inc.
Dallas, Tex.
„
Leslie B. Schwinn
L. B. Schwinn & Co.
/c
(bee page 63. Ed.)
Note:
of
the
Following
Education
Portland, Ore.
Cleveland, Ohio
are
Com-
James
A
q
E
Sn
Me/r*n .^y"ch' Pierce' Fenner
& Smith Inc.
Chicago, 111.
an
audi-
Walter E. Auch
Bache & Co.
Detroit, Mich.
der
Auyn & c0
Chicago, 111.
RoJ|lert .J^on' Chairman
"<
Frank E. Voysey
bidder
Kidder, pJaho,
Peabody
& Co.
Chicago, 111.
Wendell W. Witter
George R. Young
San
Francisco, Calif.
Dean Witter & Co.
Kay, Richards & Co.
Pittsburgh, Pa.
viewed, including the following:
California Group Survey of Training in the Securities Industry
This
spring the
tion
Committee
vey
to
Group
conducted
Educaa
sur-
determine general trends
STATE AND
MUNICIPAL BONDS
ACTIVE SECONDARY MARKETS IN
NEW ENGLAND MUNICIPALS and
HIGH GRADE GENERAL MARKET REVENUE BONDS
Second Oldest *
★
Call
or
Wire for
Bids and Offerings
INDUSTRIAL
ff ARKNESS &
HE
INCORPORATED
Specialists in Tax Exempt Bonds
140 Federal Street
Mo.
Rosenfeld
J? s* essays- -Mr. Sherburne is a
Sru311 «<man??S
nio ?
r
CG
other
300,000 each week. Arrangements
Reese
Cook & Co.
Dean Witter & Co.
on
estimated at from 250,000 to
F. S. Moseley & Co.
Boston, Mass.
John H. Rauscher, Jr.
V-+
William O. Alden, Jr.
Alden & Co_.t Inc.
Louisville, Ky.
gunday afternoon
Despite competition from
7.
Ness
Edwin J. Pingree
Comnetition
mittee:
.
J.
Johnston, Lemon & Co.
Washington, D. C.
awarded tne prizes tor the two
members
A 13-week television series
called Investors' Forum began on
broadcast
Essav
Lyons
Cruttenden, Podesta & Co.
Chicago, 111.
f ™ne' r"311^311
9, the Institute Planning Sub- Eugene M.
Committee, announced the winNewhard,
ne^s °
.? institute essay contest
St. Louis,
and ^r^,slr^
George A. Newton William W.
Editor's
Series, Investors'
HUbbard 2-2250
.
.
.
Boston 10, Mass.
Teletype BS 570
Fenner
W. E. Hutton & Co.
,
T
c
Forum
A
1961 institute of Investment
Rankinir
*
Pierce,
Denver, Colo.
assistance
advertising and promotional programs
Open-house meetings for public
Showing of IBA Films
training
October 8 and will continue to be
erG trainine^^o^ram^which
ha?
has been offe^ed
offered the nast
past thlee
three
on
classes of this executive development program, which is sponsored
The
Investment
summers.
the cam¬
pus of the University of Pennsyl¬
vania in Philadelphia.
This was
a
cities
34
Y
of
sales
n uY,.
T
Lynch,
Edgar J. Loftus
universities
banking firms
training programs
investment
& Paine
'
& Smith Inc.
Active
utilized
Ir
Va
r,
Merrill
programs
training
Junior- Achievement
More
Kpmn
Richmond
~
grams
=
c
Abbott,'Proctor
rums
the part of member organizations.
Y
Philadelphia, Pa.
Public Lecture
(48
'
Robert W. Haack
grams:
The
,
Kansas City, Mo.
a re-
activities
members
more
'
H. O. Peet & Co.
by more than 65 IBA member or¬
ganizations are briefly described.
one
Paul, Minn.
Gage C. Frick
being promoted by other member
organizations. Activities conducted
Many
Field
Webber, Jackson &(
Curtis
St.
their
by presenting
programs
Paine,
De¬
designed to aid
in
Robert D.
Francis I. duPont & Co.-
of
cember Bulletin is
of
James A. Felchlin
Charles L. Hewitt
During 1961
view
Clark, Dodge & Co., Inc.
New York, N. Y.
Milwaukee, Wis.
Member Activities
separate
York, N. Y.
John W. Dayton, Jr.
an
companies.
A
New
fund
a
Dillon, Union Securi¬
ties & Co.
Program
NATIONAL BANK OF
RHODE ISLAND
Municipal Bond Department
?
-
1
C.
R.
-■*
Fulton, Reid & Co., Cleveland;
Fulton, Reid & Co., Cleveland
Jack
R.
Mr.
Staples,
&
Mrs. Alan
Merchant Marine Financing
result
The
that
is
to¬
day all the unpaid principal and
the unpaid
interest on ship
all
mortgages and
loans
are
insured
by the United States.
Government's
of
In further
Credit
support of the insur¬
Title XI provides:
That "faith of the United
States is solemnly pledged to the
(1)
the interest on and
balance of the princi¬
pal amount of each mortgage and
loan insured under this title";
of
payment
the unpaid
That "each insurance
(2)
tract
gagee
.
.
.
or
shall
run
lender
the mort¬
to
be
and
con¬
the
for
benefit
of
such
lender
and
the
mortgagee
holders
of
or
the
which
of
duress,
such
clusive
such
evidence
loan
provisions of
all
the
loan,
terms
well
as
Thursday, December 28, 1961
with the
and that
XI
markets were consulted.
Attorney General's Opinion
mort¬
the
of the
mortgage or
the mortgagor or
and the mortgagee
as
The
Attorney General also ren¬
opinion stating, in part;
dered
that
an
"contracts
of
insurance
en¬
tered into in accordance with the
.
The insurance contract is for
That amounts required to
paid as insurance "shall be the benefit of the holders of bonds
issued
under
trust
indentures,
paid in cash";
while
in
the
early financings,
(5) That contracts of insurance
these consisted of a single note or
entered into pursuant to Title XI
bond for the entire amount of the
(4)
be
incontestable
are
from
the
date
mortgage, it
soon
there
of
ance
was
be
Established
1919
these
serial
CHARLES A. PARCELLS & CO.
Midwest Stock Exchange
in
to
the
in
the
smaller
of
sale
public.
Ac¬
it
in
Corporate and Municipal Securities
The
first
of
these
bonds
the
United States
The
absence
of
a
"credit"
the
of the
not significant.
was
Attorney
sold—and
and
we
granted
Merchant
insurance
the
in
cash
Ship Mortgage In¬
surance Fund provided by statute
proved to be inadequate.
The
Comptroller of the Cur¬
ruled that the limitations
rency
and restrictions contained in Sec¬
tion
5136
Revised
their
would
cable
to
ment
Insured
Bpnds;
indentures
dependent
availability
order
to
of
the
assure
the bonds,
create
an
rate,
a
satis¬
and
to
interest bv investors in
and
under
Act
Securities
the
qualification of
of
the
1939
indentures
and
the
v,;
At
a
later
Authorized
date—in
1959—the
public offering of bonds
ther facilitated
of
Title
bonds
XI
in
to
by
an
was
permit the sale of
advance
of
payment of
MEMBERS
DETROIT STOCK EXCHANGE
MIDWEST
this
of
was
to
be
the
fore¬
Underwriters and Distributors
similar issues,
required.
First,
many months of work by Grace
Line, the underwriters, the trus¬
tees
work
and
many
Municipal and Corporate Bonds
was
the
Maritime
Listed and Unlisted Stocks
and
PENOBSCOT BUILDING
the
DETROIT 26, MICHIGAN
preparation of suitable documents.
to
same
I
Adminis¬
tration, and their staffs
counsel,
were
required
in
At the
EXCHANGE
thereunder.
runner
much
STOCK
Phone 963-9565
time it was necessary
the
problems in¬
Teletype DE 76
determine
herent in
a
public offering and to
take action to insure
success.
GRAND
RAPIDS
E.LANSING
MUSKEGON
FLINT
Meet¬
Baker, Simonds & Co., Inc.
Broad Midwestern Distribution Since 1920
MEMBERS
OF
NEW
YORK
AND
WATLING, LERCHEN & CO
OTHER
STOCK EXCHANGES
Corporate and Municipal Securities
Member: New York Stock Exchange, Detroit Stock
American Stock Exchange,
151
Correspondent
& Dominick
Dominick
■
^
■
f
W.
Congress St.
Detroit
FORD
Ann Arbor
•
Birmingham
BUILDING,
Jackson
•
Exchange,
Midwest Stock Exchange.
DETROIT
•
26,
MICHIGAN
'Kalamazoo
Dearborn
•
•
Pontiac
New York
fur¬
amendment
McDonald-Moore & Co.
of
not
.v..'.-.;'
;v
Pre-Financing
believe
issue
Trust
were
required.
in
acceptability
to produce
interest
factory
Congress
the
under
1933
Indenture
appropriations.
of
Nevertheless,
the
upon
and
Commission
the
not
Marine
Securities
the
and
appli¬
Govern¬
concurred
opinion that registration of
an
bonds
which
be
Merchant
of
were
investment
not
Unitedt States
Exchange
in
as
accounts
own
securities
the
the pledge of faith
evidenced that obligation
States
amended, as
to national banks dealing in, un¬
derwriting, and purchasing for
Act
and
United
the
of
Statutes,
further
contracts
extent
the
to
Federal
concluded that the obligation of
the United States under insurance
General
Marine,
for the Sec¬
retary of Commerce to borrow
from the Secretary of the Treas¬
ury moneys with which to pay
authority
were
successfully for a first of¬
fering—by Grace Line, in 1958.
This public offering of bonds was
accomplished under specific pro¬
visions
of
Title XI
permitting
Since
Bell System Teletype DE 206
of
American
the
quite
bonds
26, MICHIGAN
pledge
.
.
Insured Merchant Marine Bonds."
trust
Building
that
stated
was
bonds to give such bonds the
"United States Government
issued
Underwriters, Distributors and Dealers
639 Penobscot
bonds
and
appropriate in
first public offering of Title
the
XI
wider
much
a
title
Members:
Stock Exchange
bonds
cordingly,
became evident
tapped by the issu¬
denomination
Telephone WOodward 2-5625
that
ings were held with underwriters
and rating agencies. Prospective
obligations secured by the mort¬ borrower
title would establish a valid and
gage
or
evidences of the loan, or lender, have been approved by binding obligation of the United
if the mortgagee or lender is the
Secretary of Commerce; and
States," and that "it is
appro¬
a trustee under a trust indenture,
(6) That the Secretary shall priate to conclude that Congress
for the benefit of the holders of find that the
property or project intended to place the obligations
the bonds or notes issued under with
respect to which the mort¬ assumed by the United States
such trust indenture";
a
contract
of
insurance
gage or loan will be
executed under
(3) That defaulted mortgages "will be, in his opinion, eco¬ pursuant to Title XI on a parity
with the obligation which it as¬
and loans may be assigned to the nomically sound."
sumed with respect to its interestgovernment without foreclosure
Benefit of Bondholders
bearing
obligations."
He
also
by the mortgagee or lender;
that
DETROIT
are
con¬
are
complies
Title
George Wendt, First National Bank of Chicago;
Cutler, Chapman & Cutler, Chicago
Wm.
and
market to
Detroit
contracts
contracts
or
Mrs.
Paul
except for fraud,
mutual mistake of fact,
or
&
Francisco
into,
that
gage
Mr.
Browne, Bank of America, N. T. & S. A.,
entered
ana
Continued from page 20
K.
San
as
ance,
.
.
-
The Investment Banker and
Pledge
.
*&?,<
Chapman,
defense."
Chronicle
The Commercial and Financial
72
Volume 194
Number 6120
cost of ships on the basis
deposit of bond proceeds in
escrow
with
the
Secretary
of
Commerce, pending disburse¬
ment. Also, in 1959, more flex¬
ibility was added by an amend¬
ment permitting owners to defer
placing mortgages on their ships
until after delivery.
Notwithstanding the existence
of
the
pledge of faith of the
.
.
.
The Commercial and Financial Chronicle
73
actual
pendent U. S.-flag tanker owners,
advances
they will be
of
whose tankers
of
able
a
States
United
the
to
payment
of
construction
were
differential
subsidy
and who have operated without
operating-differential subsidy aid,
were forced to lay
up their ships
or operate them at rates far below
a
break
heavy
-
-
financial
The
Maritime
Administration,
negotiations with Title XI appli¬
cants the following excerpt from
its collateral by making advances
mortgagor
under
the
circum¬
stances of the particular financ¬
that
it
to
protect
government's
and preserve
of
principal for account of the
shipowner. As the advances of
principal were applied directly to
financial
we
are
that
in
the
into
the
desirous
loan
of
insurance obligation and since
try
requirements
as
petroleum
You
would
prefer
lend¬
er
or
mortgagee be limited to
such substantive matters as fail¬
ure to pay principal and interest,
or
failure to carry vessel insur¬
contrary,
we
that defaults running to the
...
to visit
our
government
leaving to the
ance,
are
SvuM&l
number of technical defaults.
the
discretion and flexibil¬
sufficient
ity to cope with emergent situa¬
tions and yet protect its interests
without any additional risk to the
lender or mortgagee.
What we
new
offices in the
LaSalle-Jackson
the lend¬
institutions not adopt an at¬
titude of relying solely upon the
Title XI insurance, but that the
transaction be regarded initially
intend to suggest is that
ing
as
government - guaranteed
In this manner, the gov¬
available to it, with the
be
resultant
termination
the
that
probability
not
might
otherwise
investments by reason to de¬
faults will be less likely to occur.
of
The element of risk is
insurance
all
in
inherent
programs,
and
exception
Actually, were it not
Title XI is certainly no
to this rule.
the
for
risks
which
early in '62
benefits
safeguards
financial
possible
which
the
have
will
ernment
of
Building
commercial venture and last¬
a
ly as a
project.
are
particu¬
prevalent in the shipping
industry, with its wide fluctua¬
Substantial
rates
charter
the
of
and
and valleys of prosperity
and depression, there would be no
necessity for a Federal ship mort¬
peaks
gage
insurance
program
since
adequate financing could be ob¬
tained
institutions
government aid.
from
without
Three Defaults
Only
Thus
to
lending
Chicago Head Office into new and larger
far, it has been necessary
on only three mort¬
gages, and we
demonstrated to
have
adequately
institu¬
insurance
program by cash payoffs aggre¬
gating nearly $7,000,000 to the
lenders upon default by the ship¬
owners.
The
mortgage
on
the
lending
tions the stability of our
trailership
CARIB
QUEEN
was
over
and
the
to
American
per cent, we
increased pore than 50
will be able to incorporate
improvements in facilities and
many
services
could
that
dated until
accommo¬
Many of you will recall that, as recently
1949, Cruttenden, Podesta & Co. had
as
less
than
60
employees
branch offices
we
.
.
.
only two
(Omaha and Lincoln)
representatives.
Our entire
joins
us
organization, coast to coast,
in extending this invitation to
stop in and see our new
time
head office next
you're in town.
Sincerely,
is
being offered for sale under com¬
petitive bids.
In order to avoid other potential
aggregating approximately
$1,131,000. The necessity for mak¬
ing these advances arose from
the seriously depressed condition
of the shipping industry, particu¬
larly the tanker segment. Tanker
charter rates, as a direct influence
of
the
Suez
crisis, plummeted
from a near record high in early
1957
to
a
persisted
variations.
record
with
As
a
low
which
Cruttenden,
Podesta
&
Co.
Members: New York, American, Midwest and
Pacific Coast Stock Exchanges
209 South La Salle Street
Chicago 4
•
DEarborn 2-0500
has
minor
seasonal
result, the inde¬
.
have 26 offices in 13 states, over 500
reconstructed into a firstclass passenger ship for use in its
transpacific trade. The freighter
COAST PROGRESS is presently
ships
.
employees and more than 200 registered
being
defaults, the Maritime Adminis¬
tration has, to date, made princi¬
pal payments to owners of six
tankers
and
two
container-
.
registered representatives. Today,
the
and
be
not
now.
Navy,
President Lines
year.
With floor space
ship turned
where it is
being successfully operated to the
government's advantage. The LEILANI
was
recently
resold
to
foreclosed
first of the
quarters shortly after the
and 20
foreclose
growth of our firm in recent
necessitates expansion of our
years
larly
tions
distant
of the indus¬
great
On
a
too
future there will be blue skies for
building
agreement
not
the tanker segment
not intended to suggest
are
restrictions
been
the reduction of the government's
(of Commerce) as the initial re¬
sponsibility of the lender or mort¬
gagee."
This is
Some
advances
viated by
feel
no
Deferment of Principal Payments
who,
added
ing is regarded by the Secretary
thai;
to
imposed until the ad¬
repaid to the govern¬
ment, all of which has been done
with the hope
and expectation
that shipping rates will improve
and the companies eventually will
be able to operate profitably. We
when
profitable, felt
the
in
was
precautions
we
and
vances
times
at
were
due
advances,
protect the government's interest,
ship
interest
"The
imposition
of
financial
covenants upon the borrower or
taken
haying committed itself to insure
mortgages
in
the
more
event
readily avail¬
of
a
national
emergency and could be quickly
diverted to defense purposes. Pay¬
ing off the mortgages and laying
up the ships in the Maritime Ad¬
ministration National Defense Re¬
making these
have
continue to bear in mind in their
XI regulations:
In
have
case.
charter rates
Title
States.
level, suffering
losses in either
even
principal and interest on Title XI
loans
and mortgages,
it is our
hope that lending institutions will
our
were made for payments
continue to increase and obsolete
interest, these advances did not war-built tanker tonnage is either
result in any increased contingent converted into dry cargo ships or
liability of the government. These scrapped. We are already cur¬
actions were concurred in by the rently
experiencing
some
im¬
Comptroller General of the United provements in the market.
built without
Offices in 26 Cities, Coast to Coast
have
been
ob¬
action of the mortgagees
with the consent of the
Administration,
have
Maritime
agreed to deferments of principal
payments, usually for two-year
periods. Ten companies have re¬
ceived
such
ternative
deferments.
The
al¬
to making advances or
consenting to deferments of prin¬
cipal is that of incurring the risk
of having to pay the insurance in
full. We much
prefer to have
these
ships in operation where
Fleet
serve
only
as
a
justifiable
appears
last resort.
Turning now to the status of
existing program, on Sept. 30,
1961, there were outstanding $356
the
million of insured loans and mort¬
together
gages,
with
commit¬
ments to insure
an additional $102
million. Of the $356 million, over
$100
million
represented
public
issues of Merchant Marine bonds.
The balance was composed of pri¬
vately
placed
loans
gages. The lenders and
Continued
and
mort¬
mortgagees
on
page
74
74
Mr.
&
The Commercial and Financial Chronicle
Mrs.
Newman L. Dunne, Robert W. Bctird & Co., Milwaukee;
Ira B. MacCulley, Equitable
Corporation, New York; Quitman R. Ledyard, Equitable Securities Corporation, Nashville;
H. Frank Burkholder, Equitable Securities Corporation, Nashville
Securities
Continued from page
Insured
73
Marine
Merchant
Bonds
the
and
have
we
that
significance
of
these
prices to the promotion of a mar¬
ket. It may also be said that we
of
have at times taken the initiative
which
at
costs
various
private
were
kinds.
A
placements
few
of
have
the
been
converted from notes to Merchant
Marine
present we have required
a separate mortgage for each
ship
which resulted in a separate bond
for
series
might
each
ship. While
each
be
relatively small,
ranging from $4% million to $10
million, there is usually more
than one ship
involved, so that
the total underwriting has ranged
from $8% million to $20.2 million,
in
two
cases
representing four
ships per issue.
Bond
word
Price
issue
of
the
that it
Letter
This
considered in
recent
City
Monthly News
been
added
to
article commented upon
same
Kennedy in his initial attempt at
nudging
the
capital
market
through his economic message of
Feb;- 2,
then
tention
President
since
consistently focused at¬
upon
of
growth and
Our
the
and
has
The Maritime Administration is
pricing of these Government
had
a
the need for lower
interest
rates
stimulating
as
a
economic
recovery.
nudging has been sincerely
intended
to
be
constructive.
In
it
but
desire
one
the
and
underwriters
shipping industry in de¬
the appropriate market
veloping
would
in
reflect
the
lowest
recognition of the
attractions
inherent
many
these
in
Up
Marine Bonds
not
yield
until
Thursday, December 28, 1961
most
a
date
recent
should, in general,
at
ments. This aim has
already been
The
construct these
eign
of
further
them.
believe
education
more
of
that, after
investing
the
construct
to
ships in American yards
is $2,694 million. The difference
between that and $1,379 million,
representing the estimated cost to
beaten
one
cost
estimated
these
reached with two issues and been
in
York;
C. Legg & Company, Baltimore
original issue more
than 50 basis points higher than
outstanding
long - term
govern-
We
bonds.
National
the indicated interest of President
long-term
tors which must be
borrowed
responsible
the lexicon of the capital market.
means
the
First
Bank of New York
"Nudging"
not unmindful of the various fac¬
have
I
from
having noted in
sources,
Bonds.
To the
series
"nudging."
this
John
assist
the
and
.
Charles W. Easter, Blyth & Co., Inc., Seattle, Wash.; William F. Morgan, Blyth & Co., Inc., New
James E. Roddy, Scharff & Jones, Inc., New Orleans; Joseph W. Sener,
had
to
generally com¬
mercial and savings banks, insur¬
ance
companies, and trust funds
of the latter
,
.
ships in for¬
same
yards, will be eligible for
payment by the United States as
construction
differential subsidy.
-
public and further seasoning, this
point differential can be reduced.
plied by the subsidized operators
a
We
from
recent
factors
million
all
the
nominal
interest
from
ranged
low
a
have
rates
of
4.20%
to
high of 5%, except for the most
issue
which included $6
of serial bonds maturing
in from one to eight years, with
the nominal interest rates ranging
from 2.65% to 4*4%, respectively.
The long-term portion of this is¬
carried
sue
the
At
enter
time of
issue, these in¬
terest rates ranged from 45 to 89
basis points over long-term gov¬
vinced
able
the
great.
At
issues
exceeded
time,
triple A Coroo-
same
rates by from 3 to 55 basis points.
We believe
also
are
that these
too
believe
differences
In
great.
fact,
that
strongly
Merchant
Marine Bonds should not be
pared with
bonds.
we
com¬
related to corporate
or
Future
Bond
is
Marine
of Corporate
Merchant
While
Bonds
Marine
secured first by the
second
ship itself,
general credit of
the
by
the
company, and third
Government guarantee,
the
that
last
by U. S.
it is ob¬
named
the
is
really significant security and the
which
unique.
these
makes
This
is
the
bonds
that
reason
believe that Merchant Marine
we
Bonds
should
classified
be
quasi-government bonds and
pared
with
Bonds
and
We
adequate
U.
not
further
believe
that
as
com¬
Government
S.
corporate
evidence
conclusion
to
>
bonds.
there
is
support
a
that
whereas
in
the
immediate future these Merchant
Marine
Bonds would most likely
realistically be priced in the in¬
terest range between U. S. Gov¬
ernment
Bonds
and
Triple
A
Corporates; there is likewise ade¬
quate evidence to support a con¬
clusion
that
ultimately
mate
the
these
more
should
bonds
closely approxi¬
interest
level
of
long-
term U. S. Government Bonds.
Because of the requirement that
these
bonds
be
sold
at
original issue to meet the
tee
par
on
guaran¬
qualifications, the nominal in¬
terest
rate
is
somewhat
significant than with
more
bond
issues. The U. S. Government in¬
other
surance
virtually guarantees that
purchasers of the bonds will
repaid. Because of the possi¬
bility of default by the borrower,
this repayment may occur prior
to maturity. This is a factor which
cannot
be
ignored
but
which,
relatively, is not very material.
Therefore, we believe that we are
the
be
now
a
reason¬
Prospects
future
of
Insured
Bonds?
U.
There
are
15
of
the
United
States
are
ship
built
U.
a
S.
with
of
terms
of
which
these
are
are
for
built in American
borrow
insured
up
to
owner's cost. There
at
a
point where
Merchant
within
the
of
the
some
rela¬
tween
actual
cost
for
Title
XI
insurance purposes and capitaliz¬
able cost.
said
that
Consequently, it can be
approximately 75% of
or $1,034 million
be borrowed by the means
of U. S. Government Insured Mer¬
chant Marine Bonds
years,
new
re¬
ships
shipyards. Cur¬
contract for
next
75%
are
tively insignificant differences be¬
20
rently, these subsidized operators
scheduled to
-
may
contracts,
required to
place their fleets with
a
Government
the owner's cost
the
of
owner
construction
subsidy
may
By
borrowed
or
Under Title XI the
with the Maritime Administration.
most
sup¬
funds.
performing under operat¬
ing-differential subsidy contracts
the operators
be
must
own
mortgage
S.
Merchant
steamship operators in the foreign
ships
Bonds
one
Issue
the
Government
are
vious
is
con¬
their
15
214
years.
over
the next
15 years to carry out the
require¬
ments of the subsidy contracts.
The combined net worth of the
15 companies at Dec.
31, 1960
was
approximately
million
and
'
Not in Category
are
aim
are
on
commerce
too
these
we
$1,379 million
differential
who
certainly
but
one.
ernments. We believe that the lat¬
is
many
other
the pricing of
into
that this
ter
difference
that
securities,
What
of 4%%.
rate
a
recognize
The
they had
on
$757
deposit in their statu-
Volume
tory'
1961
in
194
Number 6120
funds as of June 30,
approximately $310 million
and readily
marketable
reserve
cash
securities. The entire $310 million
is not available for ship construc¬
tion
because
tual
restrictions
of
various
and
contrac¬
because
of
.
.
The Commercial and Financial Chronicle
.
proximately $57 million in mort¬
very
sizable potential
requirement for borrowed
capital in the form of U. S. Gov¬
facets
ernment Insured Merchant Marine
lenders
receive a triple
rating, as have others in a
similar category.
With outstanding insured loans
and
mortgages of $356 million,
Bonds, and the Maritime Adminis¬
Ample
tration
been
commitments
rates.
operators
tion
ships. But the greater
of
it
will
this purpose.
In
addition
be
to
available
the
por¬
for
subsidized
operators,
there is considerable
interest in Federal Ship Mortgage
Insurance for other types of ships.
These include coastwise
roll-on
roll-off
and
operators;
container
the
subsi¬
potential.
These
applicants are, in general, some¬
what less strong financially; how¬
ever, it is safe to presume- that
Merchant
Marine
A
owned
for
Bonds
under
an
a
further
$57
these
XI
additional
$102 million, applications
for
of
Title
hand
and a
on
million,
potential borrowing of $1,034 mil¬
lion, it is obvious that the present
statutory ceiling of $990 million
ships, and applicants for operat¬
ing-differential subsidy. There are
applications
on
file
with
the
may
most
cer¬
Maritime
tainly give consideration to
pro¬
Administration
for
ap¬
the
tutions. We
dized
above
mortgages
presently
that
most
over
operators issued
insurance would
their
posing to the Congress
ceiling be raised.
Maritime, we have accomplished
very close and satisfactory re¬
lationship with the lending insti¬
and
gages
the need to retain funds adequate
to meet current amortization of
on
75
To
to
sum
be
it all up,
a
there
appears
a
future
is
going to be looking to
Investment Bankers to develop a
supply
In
of
capital
at
reasonable
have
a
consenting to
deferments
problems
and
which
tween the owner,
throughout
evidence
lenders
have
a
entry
this
feel
has
fact
the
of
the
at¬
in
and
the
spectrum of investing groups, and
be¬
we
have
arisen
throughout
the
broad
believe that the securities
are
do
of
such
soundness
as
to
be
vir¬
the
by
terms
not
role
government,
by shipowners
and
foresee
Maritime
of
can
upon
conditions,
the
return
of
Administration
to
lender
competition
mortgagee
or
with
commercial
lending institutions.
*An address
50th
Annual
ment
the lender, and
we
response
the
obtained
we
the
be
of
reasonable
for
will
grounds,
favorable
insured
be
the
settling
tractive
anticipate a
from all
lending market. If
short- and long-term loans, fully
We
advances
in
these
field.
program
we
to
country.
this
of
by
into
large
which
the
we
daily
is
attractive
more
disclosed
future
which
program
becoming
new
confident that
are
tually without risk to lenders. On
Hollywood
by Mr. Nichols before the
Convention
Bankers
of
Association
Beach, Fla.,
the
of
Nov. 28,
Invest¬
America,
1961.
not be sufficient. Should this
to be the case, the Maritime
prove
Administration
would
Serving the underwriting requirements of statest
countiesf municipalities and the investment
needs
of individuals—banks—dealers-
corporations and financial institutions
FROM
Mr.
&
New
COAST TO
COAST/
Mrs. Claude D. Seibert, Commercial & Financial Chronicle,
York; Milton J. Hayes, American National Bank & Trust
Company, Chicago
STATE
Cushman
•
MUNICIPAL
•
U. S. GOVERNMENT
McGee, R. W. Pressprich «ft Co., New York; Mr. & Mrs.
Pfeffer, First National City Bank, New York
Delmont K.
Building with Chicago since 1863
The First National Bank
of
FRanklin 2-6800
Dearborn, Monroe & Clark Streets
MEMBER
Clarence
Davis, First Cleveland Corporation, Cleveland; Franklin
Schroeder, Braun, Bosworth & Company, Toledo
L.
Chicago
FEDERAL
DEPOSIT
INSURANCE
CORPORATION
Teletype CG-987
76
The Commercial and Financial Chronicle
.
.
.
Thursday, December 28, 1961
■I
Mr.
Mrs.
&
Marquette
de Bary, F. S. Smithers
F.
S.
&
Smithers
Mrs.
&
Co., New York; Mr.
Co., New York
&
W.
Norman
tion. There
Dilemma
Confronting U. S.
Regarding Latin America
of
his
Brief
colors:
true
Freedom
ecution.
vanished.
in
resulted
trials
mock
The
Meanwhile, Castro seized
17
indeed,
of
lucky
military
mass
the
ones
ex¬
press
in
op¬
to him were banished;
most were jailed or shot. Property
position
was
seized, without compensation.
Callously, he began purging the
very Cubans who had helped him
attain
power.
evident.
The
the
forces
armed
and
and social
university
unions,
fessional
groups,
organizations,
harmonize
eco¬
faculties, pro¬
civic and farm
were
remodeled to
the
with
of
pattern
all
of
planning. Trade
central
communist
and
control
rigid adherence to directives.
This betrayal of the
goals
of
announced
revolution amazed
the
people of the
the
shocked
and
United
We
States.
nearly
pended
Cuba.
This
tional
income
dollars
ing
a
for
with
by
year,
the
the
all
even
Castro
Soviet
a
sus¬
with
Cuba's
half
modest
and
trade
reduced
which
trade
na¬
billion
after allow¬
amount of
developed
Union
and
her
satellites mostly in military items
on
the
would
import
side.
no
America.
The
total
all
of
flow
which
of
States
immediate,
was
affected
capital,
that
United
among
it
charac¬
there
compensation. The
private investors
and
and
boasted
be
reaction
Latin
of
private
had
reached
a
million
a
year
$600
1958, dropped to less than half
amount.
It
in
was
at this stage
Latin
America
that opinion
became
am¬
bivalent. The great sea
privileged, with
in the
own
no
t
the
They
i e-s,
r
believed
nessing
they were wit¬
repetition of the Mexi¬
a
revolution
1910.
of
of their
continued to
Cuban
revolution.
c o u n
can
of under¬
vested interest
established orders
praise
It,
which
had
too,
extremism,
smoothed
out
moderate
nomic
began in
its years
had
eventually
of
continuing
eco¬
but
into
and
a
program
development
with
con¬
siderable justice for all classes of
the
population.
The
of
masses
Latin America concluded that
tremism
of
relations
broke
States
teristically
be¬
Communist
party of Cuba, which once had
supported Batista and dismissed
Castro as of no importance, be¬
came
the sole political party of
Cuba. Communists took charge of
nomic
assets
that
Over
Castro-communism
Then
private and public
United
in
Communists Took
came
lion dollars in
any
historic
concept
that
had
yielded
the
sought
that
fact
create
to
leaders
revolution
a
of
democratic
accompanied by
compensa¬
lics
policy
from
the
repub¬
became
and the
in
led
into more and
of assistance.
1960,
President
us
programs
In
what
for
1933,
more
'
August,
which
Many who at first were
sympathetic soon became disen¬
Eisenhower
chanted.
proach to this vexing, compli¬
problem. It was obvious at
that
time' that
merely
putting
Half
them
of
withdrew
recognition from the Castro re¬
At San Jose, Costa Rica, in
gime.
1960, they joined in con¬
demning foreign intervention in
the affairs of the hemisphere. But
August
these
to
same
Castro,
their
the
leaders have hesitated
collective
take
action
they
for
countries
own
against
that
know
there
in
exists
danger of uprisings by
the oppressed.
They know that
the problem confronting them is
as
dire and as simple as this:
grave
Either
they will bring about,
by peaceful means, rapid social
reform that promises justice for
all classes, or they, too, will face
revolutions
violent
which
could
easily result in communist dicta¬
torships.
This
would
be
cata¬
strophic for them and for us.
If
the nations of this interdependent
hemisphere cannot progress to¬
gether in freedom, in the face of
the
world
modern
indeed
would
of
have
to
respect to
the
be
one
pessi¬
the larger
historic
record
dependable cooperation is less
persuasive.
:
IV
^
President
no
must
do
we
one
all
we
Program
doubt that
humanly can
can
changed
private
more
our
ap¬
Latin
into
public
and
funds
would
America
do
little
good, if such aid only suc¬
ceeded
in
strengthening
the
prevailing order with all its in¬
justices. He therefore asked the
Congress
to
authorize
appropriation of half
an
initial
billion dol¬
what, in verbal short¬
hand, I shall call social loans —
loans
for
land
reform, schools,
low-cost housing, and other de¬
velopments which would have an
immediate and visible, impact on
the
welfare
of
the
submerged
lars
a
for
masses
of
Latin
America.
understood that the loans
It
was
were
to
foster
self-help projects, with the
recipient
governments
and
in¬
dividuals meeting a high percent¬
age of the cost from local funds.
It
was
also
loans
that
understood
would
the
conditioned
be
on
the Latin governments' pro¬
ceeding
promptly
to
make
changes in their laws and struc¬
tures
which
would
permit the
new
funds to have
pact
on
The
Eisenhower's
Surely
significantly
cated
new
menace,
action
took
the key problem.
intentions
American
clear
•
a
genuine im¬
a
leaders
few
days
of
the
were
after
Mr. & Mrs. Walter
Latin
made
Congress
approved the President's plan. At
nations
exception
bring about
distribution
table
notable
a
declared their
—
intention to
Cuban
the
—
minister being
foreign
the
of
firm
equi¬
an
owner¬
ship of land (for in some coun¬
tries today 2% of the people may
own half of all the land, and the
workers of that land may receive
little
if
anything in wages); they
revise their tax sys¬
tems to obtain
local
capital to
promote economic and social de¬
to
agreed
velopment and as a means of
overcoming
flagrant
injustices;
they laid plans for the rapid con¬
struction
of
self-help,
low-cost
housing, and said they would
develop local savings institutions
as a means of obtaining much of
the capital for this purpose; they
expressed their determination to
foster methods of
for
the
mass
eradication
of
education
illiteracy,
and institutions for improving the
health
all
of
their
peoples. In
short, they promised to carry for¬
ward, by peaceful and democratic
methods,
rapid
social
change
which would avoid bloody revolu¬
tions
and
which
achieve
would
the
of
we
United
goals
States
long ago had attained.
This
situation
the
was
President
Eisenhower
when
office
left
President
and
Kennedy assumed
Presidency
of
the
United
the
States."
office,
Shortly
tives
of
tions
the
the
proposed
The
took
sum¬
diplomatic representa¬
the
to
he
Kennedy
after
President
moned the
Latin
American
White
House
Alliance
for
na¬
and
Prog¬
Alliance
is, in effect,
implementation of the Con¬
gressional Act of September, 1960,
ress.
Latin
Morse, Lehman
Bogota representatives of most of
the
independent in 1824,
policy has, since the Good
Neighbor concept was proclaimed
ex¬
is.
sincerely
rociety. Expropriations of property
any
American
time the last of the Latin
is Mexico.
as
Castro-communism
saw
it
where
Mexican
Latin
so wedded
independence
of
in¬
This has been the heart of our
Mexico;
on
knowledgeable leaders
with
looked
were
other
and
mistic
own
keep Latin America free,
dependent, and democratic.
Fortunately, most Latin Ameri¬
Presidents, cabinet ministers,
world
their
but
to
hint
can
countries
in
nothing
the
an
system
power
illiteracy, poverty,
hopelessness.
They
over¬
them
and
ex¬
inescapable phase
movement to change an
was
Callaway, First of Michigan Corp., New York;
Brothers, New York
extra-
an
non-intervention by
and
David
country is
no
the
to
Mrs.
was never even a
imposition of
continental authority
bil¬
a
&
the
ternal
Continued from page
Mr.
Stewart,
the
and
the
August
Act of
of
this
Bogota.
year,
Then, in
Ministerial
UNDERWRITERS
MEMBERS
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&
Distributors
Midwest
Stock
DISTRIBUTORS
First
Securities
Company
Chicago
of
MEMBERS
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STOCK
Exchange
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CORPORATE AND MUNICIPAL BONDS
INVESTMENT STOCKS
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SO.
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SALLE
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STREET, CHICAGO 3
Building, Champaign, 111.
UNLISTED
TRADING
DEPT.
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135 S. LA SALLE ST.
Teletype CG 1399
ANdover
Direct Wire
to
CHICAGO
3-1520
Greene & Co., New York
FRanklin
2-1166
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TWX—CG
1110
Volume
&
Mr.
194
Number
6120
representatives
the
of
American
nations
del
Este,
Uruguay,
out
in
Latin
met
at
Punta
and spelled
detail the steps
greater
they would take to effectuate the
declarations
they had made at
Bogota. It was at the Punta del
Conference
would
America
for
that
guaranteed
ternal
next
the
United
that
Latin
from
billion
ten
years
social
the
the
receive
$2
sources
with
The Commercial and Financial Chronicle
.
Pierce,Rauscher, Pierce & Co., Inc., Dallas; H. H. Sherburne,
Bacon,
New York; B. Franklin Houston, Dallas Union Securities
Co., Inc., Dallas
& Co.,
States
.
Charles C.
Mrs
Este
.
ex¬
a
total membership of
1,000,000,
which, again, is a minority. Ther
technique with university stu¬
dents is different.
In most Latin American uni¬
versities one may remain a stu¬
dent,
classes,
attending
certain modest
annual fees are paid. And so it
is easy for a so-called
university
year
student
to
help
50s
en¬
to
versive
the
Punta
del
Este.
as
his
30s,
body and
lectuals
Critical
Two
critical
Political
leaders
in
this
demo¬
category include such in¬
telligent men as Beltran of Peru,
Frondizi of Argentina, Alessandri
of
Chile,
Lleras
Camargo
of
Colombia,
and
B.
James
cratic
zuela,
Herman
Betancourt
Lopes
Mateos
of
of
Vene¬
Mexico,
others.
Joseph, Joseph, Mellen & Miller, Inc., Cleveland;
Jacques, First Southwest Company, Dallas
F.
Masses Without Spokesman
The
ever,
are
submerged
they
yet
how¬
articulate.
may
in
some
If
they speak,
countries
vacuum,
be
huts
and
what
little
They have as
organized
power.
In
the masses are silent,
occupy.
angry.
the
have moved
dispossessed by their landlords of
their
now
Mrs.
&
little
general,
suffering,
have few spokesmen. They
not
they
masses,
Mr.
Into
university
as
a
potent political
force. By one example, I
land
this
students
Continued
on
can per-
page
78
even
carry
sub¬
on
of
Latin
America
and
are
pro-commu¬
nist.
questions
must
First, will the
raised:
be
now
Questions
or
Mrs.
activities, thus creating
impression that young intel¬
anti-American
Two
40s,
&
achieve prominence in the
the
of
in
student
visaged by the Act of Bogota and
Charter
long
so
a
revolution
without
even
Mr.
Whipple
This
is
false
a
shall indicate in
impression,
as
I
moment.
a
Latin American countries
actually
carry out the promised reforms,
save
freedom and democracy in
this hemisphere, and thus give
us
justification for the sacrifices
the United States is expected to
fundistas
make? And, second, can we carry
out our commitment without ad¬
held
versely
affecting
the
financial
position of the United States, both
military
elite
who
have
given every privilege by
domestically and internationally?
who wish to retain power
The
At
Other
the
the
communists
American
of
Extremists
opposite
land
in
extreme from
the
are
Latin
oligarchists—the
who
vast
own
which
on
feudalistic
lati-
empires
workers
are
misery;
the
been
those
and the
question: The very rich who often send their
wealth
to
the
United
answer patently
depends on the surplus
outcome in each country of strug¬ States and Europe for investment
rather than keeping it at home
gles among forces of communist
where it could contribute to in¬
imperialism, domestic reaction
dustrial, agricultural, educational,
and democratic liberalism.
and social development. Some of
In
Latin
America are 200,000
extremists
are,
like
the
dedicated communists with about these
$100 million dollars a year at communists, opposed to the Al¬
As
to
first
the
liance for
Progress. They want no
subversion,
infiltration, and change from the privileges they
have
always
adroit efforts to promote discord. and their families
They are organized on the Len¬ enjoyed.
These
are
the elite
who
for
inist principle that only the most
dedicated
and
trustworthy may generations have permitted palace
be members of the party. Others revolutions, dictatorships, demo¬
cratic
regimes, and changes of
may
be
their fellow-travellers.
uniforms—their only requirement
Fortunately, communists and their
that
inherited privileges
followers constitute a small being
their
disposal
cheating, lying,
for
minority—but it is
disproportionately
minority.
The
communists
travellers
the
for
300
and
some
publications
Punta
del
attacking the
the Charter
with
Este
violence.
Progress.
of their own
on
purchased
radio time, they are
Act of Bogota and
hibited
fellow-
and
bitterly opposed to
are
Alliance
Through
of
sly and a
in f 1 u e niial
a
They
unin¬
do
not
not
be
of the
centuries
the
20th
ing
from
of
middle
have
succeeded
in
infiltrating
a
good many trade unions and uni¬
versity
in
student
Latin
groups. Laborers
America ordinarily do
not make wages sufficient to per¬
mit them to pay union dues. The
trade unions therefore
turn
to
others
for
communists
financial
give
help.
it—for
a
price.
nearly
to
the
poor
conservatives, some middle-
They
cover
spectrum.
our
But,
some
broad
as
with
institutions.
democratic
want
the
and
a
leftists.,
political
most
of
people, they want to preserve
nothing
more
selves
are
society.
AND
ILLINOIS
NATIONAL
BANK
TRUST COMPANY OF CHICAGO
extreme than
fortunate
our¬
enough
to
enjoy in our mature and success¬
ful
CONTINENTAL
They
type of social justice we
The
Today, they control unions with
classes,
and illiterate. If
these groups were in the United
States
we
would
call some
of
desperately
of-the-roaders,
America
the
extremes
through
educated,
the
them
Latin
de¬
of the military
privileged
and
some
financial
and
only 25,000 belonged to the com¬
in
two
Municipal Securities
must
democratic
these
munist party.
Communists
they
U. S. Government, Federal Agency, State, and
in
the democratic groups—rang¬
all
opportunity to
seize
they did in Cuba where
sustained
that
and
foster
Between
are
highly
greatest
fully that the
be
velopment or suffer as have
former privileged of Cuba.
bloodshed,
power, as
However, some
cannot
therefore
want
peaceful change. They want
for in violence they
believe
they
will
have
their
disturbed.
elite realize
stratifications of the 15th and 19th
231 South LaSalle
Street, Chicago 90, Illinois
IN CHICAGO: STate 2-9000
IN NEW YORK: WHitehall 3-0100
member
f.d.i.c
The Commercial and Financial Chronicle
78
Mr.
George Meyer, Bache & Co., New York; Mrs. Henry Simonson; Mrs. Walter J. Smith; Henry Simonson,
National
Securities
& Research
Corp., New York;
Lewis J. Whitney, Jr.,
Dempsey-Tegeler
Co., Inc., Los Angeles;
Walter J. Smith,
Continued from page 77
haps show the flavor of the stu¬
dent movements.
In
Santiago, Chile, a litle more
than a year ago, I spoke with the
President
Chilean Student
the
of
Federation. The Federation has
a
membership of 25,000 drawn from
Chilean
seven
leaders
were
universities.
The
elected by free
and
secret
vote, and represent a wide
of
political
views.
The
student
president
stated, how¬
range
that all of them are Chris-
ever,
anti-communist, prodemocratic, and liberal in their
tians,
outlook.
The leader asked this
"Has
a
States
United
the
satisfied
question:
nation,
become
which
one
fights for the maintenance of the
in
Latin
dangerous
image
prevailing
America?
is being
order
accepted more every day.
is true, we must respect¬
If this
fully
This
to you that the United
say
will have
States
little
or
nothing
to
offer
the
younger
generation
who
poor
Latin
The
90%
compose
American
Choice:
the
of
population."
Work
and
or
Communism
the
In
Western
made
sense
vailing
order
he went
the
and
methods,
and
ogy
but
one
no
should be deceived: The West has
successful in
been
throughout
scale
world
the
that
values
of
modern civilization. If
spreading
certain
symbolizes
a
Christianity
Latin
in
of the
past five years, and if other
are
and
the poor,
unnecessarily to seek better in¬
opportunities in other
vestment
industrialized
nations.
As
tech¬
nology continues to develop at a
logarithmic rate, the Defense De¬
partment must consider whether a
greater share of
our
massive mil¬
itary establishment would
not be
effective for security purposes
with fewer foreign installations.
as
Finally, I would contend that if
all
such
suffice
efforts
to
ity, then
of
ouiff
areas
not
do
financial
stabil¬
must decide in terms
we
self-interest
own
which
of the world most need
assistance
and
aid, risky
our
combined
assure
might be. I
am
there
such
as
our
concentrate
a
choice
deeply convinced
viet Union and Communist China
that the Western Hemisphere and
greater share of the
Western Europe must remain free.
must carry a
industrialized nations of the world
military
extend credit to Latin America at
reducing demands
then the fiery breath of
would amount to from three hun¬
the earth."
dred to five hundred million dol¬
communism will
moving
university
cover
statement
leader
should
by
not
a
be
dents
in
Latin
America
not
may
it speak for political leaders. I think
values widely democratic
burden,
social America
can
forces
prevail.
in
But
Latin
they
lars
a
for the next ten years.
year
This is, of course, an
serious matter, in
extremely
the light of
international
current
imbalance.
it, is that
our
financial
Our dilemma, as I see
we
cannot possibly af¬
ford not to meet commitments
Latin
America, but neither
to
can we
We
numbers.
thus
gradually
on us.
obviously
to increase
all
we
of
agricultural
can
manufactured
Concern
do
must
our
export
commodities
and
goods; this places
obligation
profound
Otherwise,
freedom
will
fall
around the globe like dominoes in
labor
upon
competitive with
other
re-examine
what
we
doing in the whole realm of
seemingly afford to finance them. foreign aid, eliminate the least
on
of
exporting nations. We must
constantly
are
those
fact that the United States cannot
for long be" the Atlas of the world
without danger of collapse.
when
activities, and concentrate
all
is
obviously
peace-loving,
own
interest, share the burdens of
pro¬
moting human advancement while
stifling
the
ghastly
ism that seeks to
totalitarian¬
engulf
us.
address by Mr. Eisenhower before
50th Convention of the Investment
'An
the
Bankers
wood
Association of America,
Beach, Fla., Nov. 30, 1961.
LOOK TO DAVIS
U. S. Government
as
specialist and odd-lot dealer in such issues
American Tel. & Tel. Co.
Anaconda Co.
State and
Baldwin-Lima-Hamilton Corp.
Municipal Bonds
Bendix Corp.
Caterpillar Tractor Co.
Chemetron Corp.
Continental Motors Corp.
FWD
^
Investment Division
'
Corp.
General Box Co.
General Electric Co.
General Motors
Corp.
General Tel. & Electronics
Illinois Central R.R. Co.
U.S. Steel
American National Bank
and Trust
LA SALLE
MEMBER
AT
International
as:
Paper Co.
Jefferson Electric Co.
Marshall Field & Co.
Mickleberry's Food Products
Minneapolis Brewing Co.
Minnesota Mining & Mfg. Co.
Northern States Power Co.
Pennsylvania R.R. Co.
Pure Oil Co.
Sangamo Electric Co.
Sunbeam Corp.
Thor Power Tool Co.
Union Pacific R.R. Co.
Corp.
ON THE MIDWEST
Stock
Exchange
Company of Chicago
WASHINGTON
•
FRANKLIN
FEDERAL DEPOSIT INSURANCE
2-9200
CORPORATION
Members: New York Stock
180 W. Adams St.
•
here
freedom-
loving nations must, in their
es¬
the imperative. We n^ust keep
time
The
a
and management alike to keep our
prices
sential
such
not induced
fifteen years in
My own assessment is that the
freedom,
invest
to
structure
that private funds
no more than the reasonably con¬
a row. Of course we want all na¬
is justified for the overseas ex¬
fail in the coming
tions
to
enjoy the blessings of
giving work templated rate, then our commit¬ penditures of Americans who are
bread, dignity and security to ment, above recent averages, travelling abroad in tremendous liberty, but we must accept the
or
they often do speak for humanity.
Personal
continue
America at about the average rate
interest-rate
our
H.
and democracy
social
because
J. Jacobs, Crocker-Anglo National Bank, San Francisco; Mr. & Mrs. William
Television Shares Management Corp., Chicago;
Ernest E. Keusch,
W. E. Hutton & On;,-New York
privilege
passed by lightly. University stu¬
on,
Cooley,
York
of a American nations committed and
military
assistance.
Their
which themselves to social reform proj¬ present unprecedented prosperity
ects
that
will
cost
about
one
hun¬
controlled the power and wealth,
is partly a consequence of our as¬
surrounded by an ocean of poor dred billion dollars in the coming sistance to them following World
ten years. Twenty per cent of this War II.
people
to
whom
the
existing
They must now match our
social order meant nothing. Two must come from external sources, generosity.
We
must
be
even
mainly
the
United
States.
out of five were illiterate. Twosterner than we have been in hav¬
The
obligation
on
us
is
not
as
thirds lived in a state of chronic
ing the highest possible percent¬
malnutrition. The average income great an increase in foreign spend¬ age of aid
funds spent in the
ing
as
might
at
first
appear.
If
the
United
States so that loans and
was less than $275 a year each.
Export-Import
Bank,
the
Develop¬
other assistance represent exports
The students were bitterly op¬
ment Loan Fund, the Inter-Amer¬
of goods and services, not an out¬
posed to communism. "There are,"
ican Bank, the World Bank and its
he said, "impassable barriers sep¬
subsidiaries, and private lending flow of dollars. All nations in Eu¬
arating us from communist ideol¬
institutions of the United States rope and the periphery of the So¬
maintaining
to fight for the pre¬
order,
represented
shared:
States
United
Europe,
New
Thursday, December 28, 1961
thin layer of the population
This
Bread
Corp.,
Research
&
Mrs. Alger
.
.
What U. S. Must Do
justice, equality before the law, must move rapidly and they must
high
cultural,
scientific,
and have our active help. This brings
Difficult
choices
and
actions
technological ' levels,
and
satis¬ me, then, to the second and final must be taken. In my judgment we
must insist that other industrial¬
factory standards of living for all question I posed a moment ago.
who were willing to work. But
ized nations of the world assume
VI
to defend the existing social order
a substantially larger share of the
At
Punta
del
Este
the
Latin
in
Latin
America
meant
free-world
burden
of
economic
only
ten
and the immense multitude of the
National Securities
&
.
Exchange
Midwest Stock
Chicago 3
Financial 6-4 790
Exchange
Holly¬
fj
1 4
Volume
194
Number
6120
.
The Commercial and Financial Chronicle
.
79
/
Mrs.
&
Mr.
Fox,
Davies Robertson, Albert McGann Securities
Company, South Bend, Ind.; Mrs. P. Fred
New York City; Mr & Mrs. Harry Michels, Allen &
Company, New York City;
William Sellew, J. R. Williston &
Beane, New York City
to GATT's
Thy Neighbor's Dilemma
Continued from page 15
of
fluctuated between 15 and
25% of
A
Imbalance
Trade
Must
number
to
Be
Obviously, it's imperative that
bring its trade, particu¬
ceived
been
nadian
imbalance
Canada
country leads to
the same result as prolonged im¬
balance does for a tight rope
walker.
Canadians are becoming
a
realistic enough to see that the
compensating capital inflow will
not continue forever. And, in fact,
disturbed
what
at
this
capital, mainly employed in
uities, could
s e
mean
eq¬
in terms of
Another
1 f-determination.
alarming factor is that the servic¬
ing of this investment means a
growing tide of outflow payments
interest
of
This
one
of
the
dividends.
and
aspect, I would suggest, is
compelling self-interest for
American
investor
well.
as
only real way that this
mounting debt can be serviced is
through a favorable Canadian bal¬
to
of
trade.
There
limits
are
which
Canadians can go and
willing to go in selling assets
to pay for interest, dividends and
are
debt retirement.
Beyond, only
goods and services and returns
Canadian
earn
sary
abroad
on
can
the
foreign exchange neces¬
to discharging Canadian ob¬
ligations.
hooves
their
investment
Thus, I suggest, it be¬
American investors
own
interest
to
policies, within their
strive
own
in
for
spheres
greatest
the
prominence
devaluation
dollar.
This
has
While
been
a
I
given
im¬
substan¬
believe
useful
Ca¬
trade
but nothing
tial.
has
the
of
slight
some
provement,
and
this
a
has
necessary
step in view of Canada's critical
trading position, it is only a par¬
tial
minor
and
problem.
its
to
which
nadian
the
lim¬
are
devaluation
can
becomes, the
investment
it
more
encourages
and, of course, the greater the
ward
pressure
its value.
on
equivalent to a tariff
ports and an incentive
ports
with
and
go
the cheaper the Ca¬
as
dollar
direct
to
answer
In fact, there
inasmuch
We
on
all
all
on
im¬
ex¬
selectivity
no
still
hear
outdated,
all
by
suggestion,
that
relying
multilateral
trade.
we
balanced
on
I
settle
was
once
a
proponent of the General Agree¬
ment
Canada
friend
And,
while
years
Tariffs
on
has
and
Trade,
GATT's
has
work
since
nations
other
The trading blocs
for
a
postwar
failed, from
lack of adherence to its
by
and
best
loyal supporter.
did
immediate
the
but
and
been
most
in fact, it
in
principles
than
Canada.
being formed in
various parts of the world attest
individual
of
Discrimination"
the
Com¬
European Economic
MUNICIPAL
N/fRUST
BANK
Financial 6-5500
New York Representatives • One Chase Manhattan
Plaza
•
•
Bell System Teletype CG 368
Digby 4-7400
years,
the U. S.
about
the
•
Bell System Teletype NY 1-853
has
system of
Commonwealth preferences. It is
true
that
the
chief
balance
Canada
to
withstand
of trade with the U.
and
dictory principle that discrimina¬
tion
in international
it
unless
moral
is
discrim¬
members of
GATT have openly barred entry
of Japanese goods although Japan
is also a member. Perhaps this is
one major reason why, as I sense
it, there is more concern over
the Japan-U. S. trading position
than the Canadian-U. S. trading
position. This is exemplified by
European
this
press dispatch in
the
Street Journal dated Nov. 6,
from
Wall
European
and
other
members
U. S. and continental
competition
in
Japan
the
and
this has
vantage.
U.
S.
countries," com¬
mented
Walter
Heller, Presi¬
dent Kennedy's
top economic
advisor. "Let's export our goods
problems to third
worked to
the
evitable
Canada
It has resulted in
a
ad¬
the
balancing
a
Forming
U.
S.
is
a
not
regarded
Continued
very
■
MS
v4.CAl/^n (J
tries."
May I remind you that Canada
on the receiving end of
philosophy for decades and
that Canada's current concern is,
to say the least, overdue.
Inci¬
dentally,
Japan's
current
pay¬
ments deficit is the equivalent of
$600 million, that is, $6 per capita.
Canada's is $1.1 billion, or $60
per capita.
Unless Canada is to attempt to
"go it alone," it must accommo¬
such
date
$M
itself either to
to
trade bloc
or
bloc.
one
Any
is
sibilities
a
American
an
European trade
bound
the
New York Stock
■M-:
inflict
to
greatest sacrifice.
insure
an
maintaining
It
her
separate identity but at a terrific
price.
She
is approaching the
crossroads
on
the
horns
of
a
that is
an
American Stock
m
MS
Ms
IP
■
■
SM
MS
mean
the
end
of
long
vm
m
W.WA
the second piccolo
Such is not
spot in the EEC band.
in
the
case
of
Britain's
ap¬
plication to join the EEC because
ing,
can
hope to play a lead¬
perhaps
dominant,
role
European economic affairs.
dentally,
I
UNDERWRITERS
S:S:S:
fiddle desk of the Commonwealth
true
Exchange
Exchange (Assoc.)
MS
uncom¬
position to be in.
Joining the EEC, as currently op¬
erated,
would mean producing
goods at American costs to sell at
European prices. The "free move¬
Symphony to
Exchange
MS
fortable
would
Midwest Stock
of these three pos¬
upheaval
upon
her.
it alone" would perhaps
for
MEMBERS
MS:
a
have
heard
in
Inci¬
countless
complaints in the past about that
Commonwealth Symphony and its
H
almost
in¬
Canada-
of
trade bloc with the
coun¬
has been
The dis¬
closing of its trade gap
$M
;§g
S.
with the U. S.
In fact
U. S.
part the
U. K. trade is bound to dictate to
■
deficit
our
United
Kingdom trade and trade between
in
Commonwealth
1961,
Hakone, Japan:
"Both
are
over
Commonwealth countries.
ination."
The
edge
is im¬
trade
100%
an
Canadian
weight of the unfavorable balance
preferences
says:
of
trade with the U. K., and the ex¬
cess
so
created
has
permitted
give Canada
Chicago
of
"GATT embraces the self contra¬
Britain
•
the
complained
favorable
University
standing policy of
selective immigration.
It would
mean
transferring from the first
^
.
Brown,
York
of
charter
[yCmbamfChicago
song "Empire Prefer¬
Forever," written in Ottawa
New
appearance
Canada's
•
theme
ment of labor" clause in the EEC
BONDS
Hutzler,
advantage of
dilemma—and
STATE and
£
Commonwealth preference was to
would
U.S. GOVERNMENT
Brothers
munity, Professor Johnson of the
call
50 S. LaSalle St.
old
ence
in 1932.
by member countries.
"Going
NORTH E R
Freeman, Salomon Brothers & Hutzler, New York; Mr. & Mrs. Harry
Brothers & Hutzler, Chicago; Mr. & Mrs. Justin T.
Ottens,
Salomon
economic
^k
D.
Salomon
speaking of GATT's approval
and
the
decades
In
up¬
which I consider to be about two
this
Merrill
passing. And there has
"100%
It is
whatsoever.
The
ance
meas¬
the
themselves and, indeed, some
have been.
That which has re¬
Canada
are
of short-term
alter
ans
larly with the United States, into
better balance.
Prolonged trade
they
in
and
trading pattern
could be implemented by Canadi¬
Corrected
for
actions
Mrs.
Over
influence
ures
&
been other evidence in
government,
that will make this possible.
Canada's GNP.
Mr.
DISTRIBUTORS
with
on
any
page
80
'80
Taken
Continued
from
enthusiasm in
tinguished
r
I
79
page
Canada.
former
on
As
dis¬
a
deputy
min¬
the
Cleveland
Boat
Taken
Ride
it,
this is like asking the
Department to solve the
problems created by the Manu¬
see
Sales
facturing Department, the Finance
cently said:
"In
a
free
trade Department and the govern¬
arrangement with the U. S., Can¬ mental taxing authorities. Sweep¬
ada would be submerged without ing
these problems under the
a trace."
Canada is looking for a Sales Department's rug never has
50-50 deal and sees none on the solved anything, nor is it going
\"yhorizon; she must join some club, to do so.
and she is looking for one where
By my calculation, it would
membership offers the same priv¬ take an increase in exports of
8.6% per year to balance imports
ileges to all members.
ister
of
trade
and
commerce
re¬
■
Even Britain decided she had to
and
to
eliminate
the
balance
of
changed her mind and de¬
cided to apply for membership in
the already established one.
If
payments deficit by the end of a
five-year period, without allow¬
ing anything for retirement.
To
understand; the magnitude of this
task, contrast this 8.6% with the
circumstances forced the U. K. to
cold
belong to
a
club, and initially de¬
cided to form her
own.
But then
she
fact
that
Canada's
abandon any thought of "going it
annual
increase
alone,"
exports
was
much
more
force Canada to do
If
a
a
Chronicle
The Commercial and Financial
country,
the
any
do
so
they
decade
same.
country, had
choice of economic affiliation it
of
in
only
the
average
commodity
4.2%
in the
Fifties
and
fallen to 2.3% per year during
last five years.
This will not
production costs.
How would such tariffs be set?
The
decision
first
would
cally
or
that
not
to
whether
be
should
uct
be
given prod¬
domesti¬
a
imported.
we
taken
be
produced
The
idea is
might grow bananas
orchids in Canada but that
or
we
yardsticks for deter¬
mining the products that can be
produced economically there. The
improve
main
our
criterion
would
be
making
the fullest and most effective
use
of
our resources, but giving more
attention
to
manpower
than to
horsepower.
Because of the crying need for
adjustment mechanism, I think
S. should get set to see a
protectionist attitude taken
in Canada in the period ahead. I
an
the U.
more
has
believe it will be
the
flex
be
lowered
reaping the benefits of
action
a
taken
SEVENTY-ONE YEARS
OF
■
-
Xr/i
-
a qualitative distinction:
British
investment in the
U.
was
BANKING
terms
what
motivations
this
bond
money
dustry.
eco¬
no
has
ment of Canadian
I would suggest
By contrast, U. S. invest¬
in
ment
done
is
Canada
mostly in
equities, which control the indus¬
try more or less indefinitely.
A
vast
is extensive.
of
U.
Canada's
manu¬
would Americans feel if this
were
the
I
in
the
U.
S.?
have
a
proud history of national
growth and independence and
they are naturally sensitive to
anything which they feel places
these in jeopardy.
Americans can also help in a
tangible way.
Business policies
originating there can help solve
the export-import problem.
It is
not
necessary
or
normal
that
am
too, would be anxiously
Americans
ita
World
about
to
15% of Gross
National Product. Currently it is
down
to
about 3%, or about $18
Foreign investment in
Canada
is
now
62%
a
of Canadian
vestment alone in Canada is about
equal to total foreign investment
in the U. S., although Canada has
only
one-tenth
the
population
a
inflow of capital to Can¬
has, of course, compensated
for, and in a manner hidden, the
heavy negative balance in com¬
modity trade.
It has served to
keep Canada afloat. But its over¬
abroad
and
of
Canadian
Canadian
a.
resourcefulness
continental-volume
a
tremendous
boon
enterprise.
This
practice
Canadians
some
in
have
concern
this
take
that
steps
Continued
eco¬
where it
meant
NEW YORK STOCK EXCHANGE
AMERICAN
MIDWEST
STOCK
STOCK
ST. LOUIS, MISSOURI
EXCHANGE
(Assoc.)
EXCHANGE
CHICAGO, ILLINOIS
Moline, Illinois
like
any
commentators still insist
Wire Between St. Louis and Chicago Offices
and to Hayden, Stone & Co-., New
a
U nderwriters—Brokers
Listed & Unlisted Securities
Straus, Blosser
MEMBERS NEW YORK STOCK
DETROIT
STOCK
on
York City
and
EXCHANGE
EXCHANGE
•
&
MIDWEST STOCK
•
AMERICAN
McDowell
STOCK
EXCHANGE
EXCHANGE
stages
of
There
comparison.
is
SOUTH LA
CHICAGO
NEW
YORK
DETROIT
KANSAS
in
little
SALLE
STREET
3, ILLINOIS
ANdover
CITY
f
y
TELEPHONE
MILWAUKEE
3-5700
GRAND RAPIDS
TELETYPE
MT.
CLEMENS
CG 650
Retail
T rading
Wire
Connections Coast
development
U. S. investments
today.
(ASSOC.)
draw¬
parallel between British in¬
early
39
proud,
vestments in the United States in
its
Private
are
Frankly, it is tiresome to Ca¬
nadians to find that many foreign
a
force
page
self-respecting
ruggedly
independent people —
the country wants to be erasonably self-sustaining and reason¬
ably able to develop, direct and
manage its own affairs.
ing
to
in
exists, has been consid¬
man—and Canadians
MEMBERS
on
of
But,
INCORPORATED
with
suggestion
the U. S.
and
jobs and living stand¬
ards.
They also acknowledge
with
appreciation that, in the
main, this financing and control,
Canada
basis
of
/
is
might
noted
recent
country
Government
trade
a
erate and statesmanlike.
Stifel, Nicolaus & Company
basis
Canadian
to
well be encouraged.
impact, plus the problems of
Canada's
when
industry, yet it represents a negli¬
gible loss to bustling American
This
ada
of
d
on
and one-fourteenth the U. S. GNP.
nature
Canada
about
diligence have been able to
compete in many instances with
much larger American sources of
supply. The possibility of provid¬
ing one or two component parts
$22 billion. Look¬
ing at it another way, U. S. in¬
all
from
buy
and
GNP or, about
the
buy only $16 per cap¬
year
$207 from
the U. S. We've seen encouraging
examples recently, in the auto¬
mobile industry for one, where the
U. S. purchasing purview seems
to be broadening to incliide Can-
peak, be¬
War, only
billion.
a
Canadians
ment in the U. S. at its
First
They are peculiarly Ca¬
problems which demand
Canadian solutions. Canadians
A second distinction, which is
quantitative one: foreign invest¬
the
to
ur¬
ticated.
and
cite a few examples: our
industry is 97% controlled
from the U. S.; our rubber goods
industry about 90%; petroleum
and natural
gas,
71%; and our
electrical industry,
65%.
How
amounted
the
mining
To
fore
attempting
scale and
context of the American economy,
which is more mature and sophis¬
auto
a
much could be
Latest figures show
control 51%
nadian
situation
re-appraisal?
by
the
can
mo¬
gency of our problems. They can¬
not be easily understood in the
the
And
facturing.
you,
simply
understand
interests
S.
the subjects of
control
difference.
that
are
scrutiny at this time.
What, it might be asked,
Americans do to help in this
mort¬
or
growth
closest
gage money. When that was paid
off U. S. citizens owned the in¬
considering proper counter steps,
and justifiably so.
in
It will be
nomic
First,
S.
Ride
Boat
only
feelings. Let me state most ex¬
plicitly that Canadians acknowl¬
edge that American (and other)
capital has stimulated Canadian
growth and development to a tre¬
mendous extent.
Canadians fully
realize
INVESTMENT
Cleveland
sure
anti-foreign in spirit than
easy to counteract in view of the
increasing "road blocs" thoughout are the protectionist fences be¬
which offers the biggest market the world. We are coming to real¬ ing erected in Europe. It will be
and the best chance to be compet¬ ize that foreign markets, particu¬ just a «>ro-Canadian exercise in
survival.
itive. For this reason, there are larly for manufactured goods, of¬
Some
jokester long
ago
de¬
some
influential Canadians who fer little hope of expanding our
scribed national financing as "one
would favor economic affiliation industry to optimum levels.
generation
paying
the
last
gen¬
Thus, we must more and more
with the U. S. where a tremen¬
eration's debts by issuing bonds
dous market has
tariffs higher set our sights on the home mar¬
for the next generation to pay."
than Canada's and where, of all ket, where almost 40% of com¬
In Canada's case, the situation is
the countries in the world, wage modities used are imported. The
far more serious: we are not only
rates are the most comparable to comparable figure for the U. S.,
financing our deficits by borrow¬
incidentally, is 12%.
those prevailing in Canada.
;
ing but by actually selling the
A growing number of Canadi¬
More Exports Not the Answer
ownership
of our
natural
re¬
ans,
and many of their elected
sources and our production facil¬
In order to correct our imbal¬ representatives, are swinging to
ities. We are in effect living off
ance
of international trade,
we the view that a selective and con¬
capital and, in the process, seeing
hear much from Ottawa about in¬ structive use of tariffs will best
control of a
constant string of
creasing
Canadian
exports
by further Canada's interests at this
Canada's
largest enterprises go
vigorous selling methods abroad. time. They believe this will be
beyond its borders.
Certainly, this idea has great the most effective way of discour¬
Many of our American friends,
merit and great limitations.
To aging some imports and of boost¬
who do not fully appreciate the
count
exclusively on increased ing domestic production to eco¬
seriousness of this situation, chide
exports to correct the situation nomic levels in our! most highlyCanadians for being unduly wor¬
would be highly unrealistic.
As productive industries and thus, of
ried about it.
In so doing, they
show that they broadly misunder¬
Canadian
Thursday, December 28, 1961
.
necessary re¬
nomic self defense.
stand
.
most
more
would be inclined to give primary
consideration
to
that
economy
the
on
.
to
Coast
81
Volume
194
Number 6120
.
.
.
The Commercial and Financial Chronicle
81
Continued from page 80
Canadian
est.
subsidiaries
of
U.
S.
firms to abide by U. S. trading re¬
strictions based
on
considerations.
world
political
action
Such
Ca¬
nadians would regard as violation
of their
sovereignty.
suggested
that
friendly
Canada
few
a
relations
and
the
ago
years
between
United
States
Even
United
countries
with
faced
are
as
a
strong military ally,
especially when it is considered
a
large hunk of geography
Canada owns.
Strategically, it is
essential that this vast territory
separating the U. S. from the
do
effectively, Canada must
motivation, based
on
friendly understanding
and
economic vitality.
whole
And
for
socio-economic
they
the
look
for
and
understanding
of
In
and
powerful
their
.
the
case
the
of
imbalance,
In that of
foreign control of
industry, they simply
house.
I would suggest that co-operat¬
ing with Canadians in the attain¬
ment
be
Mrs. W.
Neal
solidly-based, healthy
a
is the best
guarantee of security for the bil¬
economy
only of the protection of this in¬
vestment
and
of
their
clearly in
aspirations
your own
would
self-inter¬
on
will
servicing
of
come
only be firmly under¬
Canada gets back
trading and operating
basis.
Our
continued
operation,
spect and
vide
based
grounds
advancement.
probably also underwrite a billion
more
speeches about our neigh¬
borly bliss.
♦An
50th
ment
address
Annual
by
Mr.
Lank
Convention
Bankers'
of
Association
before
the
of
the
Invest¬
America,
Hollywood Beach, Fla., Nov. 27, 1961.
STOCK
EXCHANGE
STOCK
EXCHANGE
STOCK
EXCHANGE
(ASSOCIATE)
underwriters and distributors
PRIVATE FINANCING
135
South
LaSalle Street
Chicago
63
3
Mary
Bingham;
Mr.
Curtis
H.
& Mrs. Richard Bingham, Bingham, Walter & Hurry, Inc.,
Bingham, Bingham, Walter & Hurry, Inc., Los Angeles
Wall Street
New
Telephone STate 2-3lOO
Mrs.
York City 5
Telephone
BOwling Green 9-2070
Los Angeles;
Blunt
Ellis
•
!•
.
&
Simmons
•;'
•
'
UNDERWRITERS AND DISTRIBUTORS OF CORPORATE
AND
MUNICIPAL
SECURITIES
Members
New York Stock
American
Stock
Smutny, R. W. Pressprich & Co., New York; Mrs. Alfred Ross; John F. Reilly,
Co.. Inc.. New York; Alfred Ross, Dick & Merle-Smith, New York
J. F. Reilly &
Exchange
WEST MONROE STREET
Telephone Financial 6-9000
Rudolf
Exchange
Exchange (Associate)
Midwest Stock
111
our
only
MEMBERS
AMERICAN
pro¬
possible drawback is that this will
^zvesfmerif<f?ecunYies
MIDWEST
re¬
for
The
jdacon^fffiyypte §
YORK
co¬
mutual
consideration, will
enduring
mutual
friendly
on
Fulkerson,
NEW
it
the
measure.
when
sound
a
the
but
the decades to
over
This
own
&
Finally,
Canadian
written
their
intend to remain masters in their
& Co., New York; Mr.
Company, New York
an
this
stage in their history will deter¬
Canadian
Trust
be
tional friendship and of joint co¬
operation in defense measures. To
mine
lem.
Bankers
to
repayment of it in large
for
example,
they feel that U. S. policies con¬
tribute significantly to the prob¬
Geo. B. Gibbons
continue
taken—or not taken—at this vital
trade
Poole,
Union
lions in American capital now in¬
vested there.
It is a matter not
neighbor.
V.
th e
vitally needs Can¬
States
transitory but indeed are be¬
coming chronic, and that they call
for bold and imaginative think¬
ing and
action.
Canadians
in
large
part
feel
that
measures
co-operation
Monroe
cues.
have the proper
are
particularly critical
days for Canada, which feels in¬
creasingly that its problems are
hope
Mrs.
their
important,
more
example to the world of interna¬
future.
&
to neutral¬
Soviet
This
is
particu¬
at the present time when
so
not
Mr.
emotional
the emerg¬
larly
or
Critical Days for Canada
Hughes, Lord, Abbett & Co., New York; Mr. & Mrs. Fred Hudson,
Ball, Burge & Kraus, Cleveland
today's in¬
ada
These
Albert
a
consideration.
not
tions.
Mrs.
politics,
valuable asset in¬
be expected to come
automatically.
That is
true of any good relationship; it
requires constant attention and
could
easily
challenges at home and both are
seeking the best long-term solu¬
&
a
what
both
Mr.
international
Especially so in
creasingly bitter and
political arenas where
ing nations often look
ist middle powers for
One of Canada's leading states¬
men
In
good friend is
deed.
—
CHICAGO 3
Teletype No. CG 642
82
The Commercial and Financial Chronicle
Leroy A. Wilbur, Stein Bros. <ft Boyce, Baltimore; Leroy A. Wilbur1,
Jr., Stein Bros. <£ Boyce, Baltimore
count
into
have
plowshares, most people be¬
peace would be greatly ad¬
own
bringing
the
set
about
control
some
a
of
sensible
the
arms.
with little
I
and
a
not
going to give
made
all
the
fail¬
part of a serious effort
serious
failure
this
last
summer
banning
of
this
to make
nuclear
significant
expected
to
now
ac¬
io
admit
follow. I
that
indeed
some
tests
first
we
step,
am
Securities
Municipal Bonds
:
All
:
Types Unlisted
stocks and bonds
of
peace,
setback from the
which
those
negotia¬
conducted at Geneva. It
perfectly apparent the So¬
during the full course of the
negotiations far from seeking an
agreement were simply awaiting
now
viets
the proper moment
subsequent
nature
tests
to
such
of
were
for
been under way
during the whole
Dealers
Distributors
•
MEMBER
CIRCLE TOWER
MIDWEST
•
STOCK
Magnifies
INDIANAPOLIS 4, INDIANA
Teletype I? 489
•
think
the
duplicity
which marked those negotiations
was not only a setback for dis¬
armament hopes, but it has cast
dismal
cloud
of
distrust
over
United States-Soviet
And
if
it
be
con¬
tions
and
wise
in
that
on
after, that we are like¬
faith, the answer is
separate occasions
bad
three
—once
to
G
y
r o m
Mr.
k
Zorin,
and
o,
to Mr.
once
Mr.
to
once
himself, I made the
that we undertake
a
mutual inspection of our respec¬
tive proving grounds to determine
what, if any, preparations were
being undertaken. I believe Mr.
also
made
the
posal. In each case I
was
not practicable.
is
now
same
pro¬
told this
was
Why it
was
apparent.
BUILDING
MElrose
•
120
E. MARKET
#T.
I suggest that
run,
aster
to
ergy
of
the
the
no
one
actions
of
of
with
this
go
•
DEALERS
•
Listed Stocks
Mutual Funds
Member Midwest Stock
exist
a
war
means
no
alternative.
passed
the
Arms
Disarmament Bill
session
because
it
saw
at the
the
used
from any definite
the Soviet's resump¬
testing in outright viola¬
great need for the existence of
moral
opinion
problem.
Republicans
Democrats alike joined in
would restrict
disputes before its jurisdic¬
A
good bit of study and
thought has been given to the ne¬
cessity for setting up new insti¬
tutions
character
Nor is any
none
and
towards those who
moral
restraint
are.
likely
to follow
if
these
nations
seek
only
to
equate responsibility where there
is no equation. The abdication on
the part of the non-aligned na¬
tions
at
Belgrade and to
large
a
part in the Sixteenth General As¬
of
We
all
would
an
can
not
race,
insure
must
and
r
be
by
likely
eliminate
this
the
arms
in
itself
peace,
race,
quently
In spite of setbacks, I do
despair of establishing a pro¬
the program towards peace.
I
shudder to think what the reso¬
control in which the Soviets would
lutions
participate and which would
would
have
been
at
Bel¬
The
put
to
use
an
chief
our
need
better
is
and
accepted
find
to
more
frequent
of settling
means
international disputes by
arbitrament
of
and
reason
and
the
law
of
gram
vance
disarmament
the
cause
and
arms
Raffen'spf.rcIkr.
1
of the same considerations
which weigh upon us must
weigh
many
upon
the
Soviet
Union
and I have met among
officials
some
convinced
whom
were
both
I
as
well,
the Soviet
was
fully
sincere
Huciies & Co.
§)
sd
rr"—
—n*
Municipal Bonds
Corporate Bonds
and Stocks
1
10.
last
Raffensperger, Hughes
& Co.
INCORPORATED
and
passing
20
North Meridian
Street
course, is not
with peace and it
recognized by ourselves
the Soviets that if any
MEMBER
MIDWEST
ad¬
of peace. I believe
"
->
jorities.
synonymous
far-reaching
disputes, but
but because
in itself, so fre¬
constitutes a threat to
arms
peace.
to
because
•
Indianapolis 4, Indiana
Disarmament, of
J*
more
settle
must, I feel, continue to do
we
not
to
a
to
early adoption.
sembly of the United Nations must
another real setback
of
at the moment appear
be marked
as
to the
tion.
moderated
feared
recourse
their
not
be
our
Court, and others have expressed
even more definite refusals to
put
a
made, but all pre¬
tense to such authority must be
abandoned if criticism is only to
be directed against those who are
to
matters have been
brought to it. We have our own
Connolly Amendment which
standard in the
or
against its jurisidiction and
few important
to
tion of the moratorium. This spec¬
tacle was unfortunate for there is
a
Impotent
Court has not been
to any appreciable
degree.
Too many reservations have been
away
of
Court
World
neces¬
sity for continuity of effort and
application
in
connection
with
this
maintained
Control
the bill with very substantial ma¬
Exchange
tion
World
The
filed
rea¬
the, fact
our
interna¬
must
other
And
wherein
settling
disputes
are
effectively used.
and
the so-called nonneutral nations as they
or
in the settlement of
disputes
means
for
tional
afford
In spite
distrust, the
of honorably
it will go on unless there is a
war. It is for this reason the Con¬
and
Over-Counter Stocks
not
among
shrank
the
is
Corporate Bonds
procedures
subject.
and
for there is
on
sonable
BROKERS
does
stable
more
but these will be
if we do not find
away
afford much hope for constructive
decisions
must
international
gress
Municipal Bonds
vital
frustrations
our
Investment Service
their
there
search for the
2-4321
Nations
swept
en¬
knowledgeable
public
opinion to support and stimulate
government
officials
to
well
thought out methods of dealing
avoiding
UNDERWRITERS
imagination and
diplomats and
Behind
body
of
INDIANA
Hope
control which may
arms
beneficial,
soon
Today, unfortunately, the
United
is
and
INDIANAPOLIS 4,
No
All this presents
a
most dis-" grade or in the General
Assembly
couraging prospect, yet the grim had we been the first to resume.
urgency
is still with us and in
we
be
a
Nations
world if progress towards disarm¬
tended, as the Soviets have, both
during the course of the negotia¬
forms of
de¬
ament is to be
soldiers.
INDIANA
be
any renewed
performing his full duty if
he is merely complacent or re¬
signed. The matter is far too im¬
portant to leave the entire subject
of avoiding a thermo-nuclear dis¬
CORPORATION
must
exchanges.
us
Indianapolis Bond & Share
force
of
United
response
I
view of the character of the risks
Telephone MElrose 8-1336
threats
or
veloped in parallel with progress
on disarmament.
Problem
Indeed
than war,
Unless we do,
shall, as I say, never have full
or
perhaps even significant dis¬
armament.
We
may
have some
we
tertained, some better methods of
settling our disputes without force
aligned
Duplicity
rather
general and complete
a
place
Kremlin's
not
EXCHANGE
L. Ray, Mercantile Trust Company, St.
Louis;
Christophel, Reinholdt & Gardner, St. Louis
before.
Dean
City Securities Corporation
Thomas
Mrs.
period of the negotiations, if not
Khrushchev
•
Thursday, December 28, 1961
action, particularly after the dis¬
appointing spectacle which took
proposal
Underwriters
&
.
.
disarmament program can be en¬
a
prove
preparation
Mr.
Co.,
hope for
to test. Their
that intensive
them must have
as
&
Arthur A.
cause
in
were
forced
disarmament,
'•
the
manner
is
Davis
York
a severe
a
indiana
Davis, Shelby Cullom
received
other constructive programs could
suc¬
an
all
or
which
could be reached. I felt that if
be
am
made
efforts
was
the
on
or
cess.
I
been
ures.
the
I had unjustified hopes
that with serious preparation and
goodwill a far-reaching agreement
itself
imposing examples,
far, however,
so
has
all
Cullom
New
progress.
of
means
reduction
It
Shelby
tions
of
spring and
security, the United States has
therefore been engaged ever since
the end of World War II in an
effort to find
Mrs.
War?"
or
Continued from page 16
vanced. In the interest of its
&
and
"Peace
lieve
Mr.
.
STOCK
EXCHANGE
and
Volume
194
to conclude effective
eager
ments.
I
in the
cannot
light of this summer's
still
am
agree¬
particularly
say,
perience, that I
I
Number 6120
ex¬
sarguine, but
am
hopeful that
sooner
or
.
I
What
of
do
disarmament is
the
is
greatest
less
no
survival.
Asia
this
of which
an aspect, is
face today for it
than
As
that
peace,
the
such
is
the
attacked
the
on
be
bread lines. We
must not only give thought to dis¬
armament and arms control plans
including
tling our
better means of set¬
international disputes,
give serious thought
political forms to meet
must also
to
new
of
some
the
newer
challenges
which the last part of the Twen¬
tieth Century have thrown at our
We
feet.
all
realize
we
are
now
going through a profound scien¬
tific revolution, one of the most
far-reaching in history. We have
ourselves
found
stimulated
compelled
to
adopt <,many
approaches to all of
radical
or
new
our
problems. The emphasis on re¬
search, on scientific application,
mathematical
new
on
forms,
make
realize
us
horizons have been
our
to
and
art
the speed of communi¬
on
cation—all
that
extended
degree
comparable to the
great reaches of the Renaissance.
a
We
it
see
all sides in business
on
—in
the new methods, the new
services, the new equipment—and
I suggest we must also examine
economic and political forms
order to keep pace with the
new
in
demands.
new
A
part
of
enon
of
this
faced with
phenom¬
great
that
are
we
vast
a
national
peoples
force
and
lution, has burst forth in coinci¬
dence
large
with
the
of
areas
demands
new
the world
for
of
im¬
proved
and
its
influence
large
portions
over
of
China
Southeast
rapproachment
form
of
tion
form, but it is
new
a
as
before
never
these
of
mass
com¬
by
the
destruc¬
accomplished
along
would
values
plications are, with the real like¬
that
the
formula
will
a
of
static
and
the forces which
.
hope
now
to
.
the
steps
to
which
present
this impressive in¬
tegration with the European Com¬
munity to take place. If this com¬
posite of Great Britain and Europe
termination
in
the
path of
subvert
would
enable
those who
destroy
or
finished products, which
community
of
interest
would represent, would so far out¬
distance
any
similar
seriously
on
such
The
a
to
as
a
matter of its
itself to
full
reach
potential.
its
It
and
is
duty
its
a
reflection
Process Report
capacity that its own
vision limits its strength at a time
upon
prospects
so
many
demands
exist
throughout the world on its lead¬
ership and the contributions which
it
make to less favored nations
can
peoples.
With the
speed of communica¬
tion which exists today, when one
can be in London and San Fran¬
on
begin
to
the
day, we should
recognize that our na¬
same
tional boundaries cannot long con¬
tinue to serve as barriers to com¬
tem
of
communication, striking
juxta-position of coal and iron, a
steel capacity greater than that of
the Soviet Union
still
these
and China
In the past ten years,
electric energy
and
skills
things
that
exist—all
its strength
Already some radi¬
suggest
and its power.
Light Company's customers
alone 87
into the
12
new
area
industries have moved
served
months, 4,441
tomers
...
5,670
by DP&L. In the past
electric
new
new gas
customers
added to DP&L mains
operating
revenues
DP&L is
this
growing state.
LIGHT J POWER
E
An Iowa
Corporation
/ Cedar Rapids, iowa
.
.
*
Company's history!
building to keep
ahead of prosperous
Central Ohio.
Total
investment
well
in
con¬
.
topped
$100,000,000 for the first
time in the
the
cus¬
added to DP&L lines
were
com¬
depository of what may
the finest managerial and
demands for
by the Dayton Power
have increased 105%. In the past five years
a
be
DA YT0H
and West-Central Ohio!
when
and
on
is
West-
plant
over
mark.
healthy growth
years
ahead.
a
bent
an
attack
for
a
true
etfa
of
the United States balance of
pay-:,
accumula¬
own
with
co-existence would be greatly ad¬
vanced.
The knotty problem of
would
own
great
how sizeable the
group
contemplate
it
express
peace
much easier way
matter how
or
im¬
combination of strength.
Perhaps
more
important than
merely
meeting an exterior challenge, it
is
incumbent
upon
the
Free
World
made
and
domination, it could not
it.
Light
or
a
for world
strength and de¬
clearly and forcibly
increased services
serve
terials
such
any
its
stantly providing
to better
be
found to enable
of
be
effective.
war
a
No
the ambitions
forces
offset
BIG PLANS
.
of
solution.
challenge it.
.
.
combination
of
would stand in
of
The Free World cannot fail to take
Company is
expanding with its
neighbors
both
.
a
would
more
issue
at this juncture
history the Free World cannot
remain
and Power
new
such
The
Challenge to Free World
balanced economy.
old and
of
strength and ideology, would im¬
mediately be reduced to a more
reasonable perspective.
The ac¬
cumulation of capital, skills and
markets, whether for raw ma¬
World
measurably
It is clear that
part of Iowa, where
The Iowa Electric
face
exam¬
under-developed world from the
Free
;
industry and agriculture
form
solid political pur¬
the approach to the problem of the
been built up.
In Iowa
.
a
on
economic
common
which, if let loose,
substantially destroy the
which have so
painfully
NEIGHBORS
.
a
weapons
We Like Our
.
interest and
political
now
Indicators point to con¬
a
of
joined with tions in the Communist world, that
ent problems would fall into place.
The
Sino-Soviet mass, in the
tinued
BIG NAMES
basis
be
strength of the
pose, I suggest many of our pres¬
lines. Great Britain is
lihood
and
Germany has already
indication of what might
the $300 million
are
the
and
an
course
resources
between
good standard of liv¬
a
ing based on the free choice of
the people and the free expression
of their views. It is an old
strug¬
technical
tended
the
Common Market and what its im¬
heretofore
ex¬
for
ining the prospect of joining the
bined,
has
have
govern¬
living conditions. A dic¬
tatorship more powerful than any
established
results
be
and
social concept borne of revo¬
the
and
could in due
been close to spectacular. They lie
not alone in the economic sphere
given
and
new expression
..;tthought arising out mon policy.
of the emergence, at long last, of
For far too long a period, Eu¬
the great continent of Russia into rope
has been emphasizing its
the place that Tocqueville so long weaknesses. The time has clearly
ago prophecized it would occupy. come to emphasize
its strength.
This movement, held back by op¬ Something over 200,000,000 people
pressive and inept governments —industrious,
skillful,
cultured,
over
centuries, with a political experienced—with a splendid sys¬
of
United States and the Americas
France
nations
cisco
times is
our
transcends
nomic lines
who,
after long periods of
development
and
reform, have arrived at a
a
we
still
the
boundaries, and it challenges all
existence
must
is
83
cal steps have been taken to in¬
tegrate this strength along eco¬
those
plicated
problem
very
this
gle in
Threat
dominate
there.
ment and
Russian
believe
I
to
representative
tirely to the government.
The
intent
to
re¬
India,
Europe failed,
of
generals in war,
important to leave en¬
too
threatening
suggest,
George's
marks about the
it
is
problem
I
Lloyd
and
All
only
we
paraphrase
is
repeat
and
war
The Commercial and Financial Chronicle
.
Africa and South America.
Though
its efforts to seize
later results will be achieved.
issue
.
Continued
on
page
84
Continued from page 83
the
challenged
nomic
balance
seriously in the
adjusted, just as
of payments of the
individual European nations have
tion demands it for
largely been adjusted by the
integration of Europe.
Many will see in this a very
large order, but the exigencies we
face are also of a large order. The
so
rent crises
economic
uniting
it
have
must
we
occur
our
promptly
these
as
better
means
thus far. Of all periods in our
case
and frustrated. Even if there
ance
were
Communist threat, there
no
would,
Not
I
not
am
state,
super
must
seek
wherein
Super
our
I
believe
we
have
deflected
been
by too concentrated attention
the moods
whose
tain
or
given
and
attitudes
directions
unformed, and
enough
we
strength
of those who
are
freedom
Our economic
because
long
we
war.
have
from the
away
place wherein most of
make
to
to
as
in this direction.
of reuse
be
done
Important
areas
more
can
industrial waste
are
sewage.
Approximately
one-half of all the water used by
is
cooling
required
water
for
and
process
boiler
feed,
industrial,
beneficial 9fes-
other
,
There
which
are
In 1955 Congress amended the
1952 Act .y increasing the total
authorization froni $2 million to
$10 million providing for the research,
development
of fresh
stitution of
in water
(3)
are
water
and
con-
(2)
reduction
of waters
and
recycling (4) multiple reuse
(5) reconditioning of water
and
wastes.
Reuse
source
In
1958
Congress
substitution
employed by
of
use
is
It
note-
its
in
available
made
the
fresh
tanks
storage
was
resi-
stricken
to
dents
.'
T
n.
„
r
Xduled ?orcomple-
is
±ormathis
1S November.
scneduleci ±or
comPie
This is a 1
enacted
an-
capacity
conversion
emnlovimr
In
thiffnrocess
vacuum
is
chambers
day
per
sea
muTti-stage^flash
the
disHllation
nrocess
f 7uperheated^brineTofution
into
piped
where
it
the
lower
flash
to
release
potentials
rjses
brackish
water
gallons
for
plant
§nieenng, operating and economic
or
in-
tion
plants to test and
reliability of ensea
sell
and
also
is
Meanwhile
week.
million
struction and operation of at least
five
saline
water
conversion
^
brine.
concentrated
fornia
other law providing a second $10
million authorization for the con-
of
which
worthy that the Freeport plant
^yas damaged only to a relatively
minor degree by Hurricane Carla
and was back in operation after
results of
demonstrate the
by
be
can
years
Demonstration Plants
demonstration
Conversion
1963 with an
to complete
year
contracts and compile
the studies.
(1) conby sub-
and waste
sources
use
the
conserve
These
uses.
servation
can
through fiscal
additional three
number of ways in
a
industry
water it
as
sources.
This
terested in the residue effluent of
a
waste to natural
sepa¬
water.
fresh
Chemical
dow
water
is
actually
remainder returned
the
steam.
to
suddenly)
The
contact
causes
pressure
(boil
coils
at
and
then
steam
the
top
water conversion processes. This 0f the chamber, condenses and
cooling processes wherever fea- law stipulated that at least three drips as fresh Water into collectsible. This is presently done to a of the Plants be designed for the
ing troughs below. This plant is
large degree by industries manu- conversion of sea water and that being built by Westinghouse Elecpetroleum
and
coal each of two plants so designed
will be disposed to do it? I have al¬ facturing
c0rp.
Flour Corp. is doing
products
in
California, Massa- have a capacity of not less than th engineering,
ways been intrigued by the com¬
tolerant part of the
community. If
of
saline
brackish
or
water
for
those in the market place do not
look
up
and view the
outside
world from time to time, who else
chusetts
and
ment Thomas Carlyle made when
he
was
informed
that the famous
lady philosopher and critic of his
and her
day, Margaret Fuller, had
Carlyle, and I think
ment bankers get
invest¬
you
the point!
*An address by Mr. McCloy before the
50th
ment
Annual
Convention
Bankers
Hollywood
of
Association
the
of
Invest¬
America,
Beach, Fla., Nov. 29,
1961.
New
Jersey; petrometals
primary
TVTowi.^
!r
o
Maryland
meiais
V,
chemicals
and
allied products in Texas
A
of
reuse
in
in
and
Planned
" iexas. nannea
sewage effluents is another approach to conservation of
fvioh
2 conservation ot
A
Is ° h^experience
^teel Comply Its
how this is done
of Bethlehem
SP^ows Point, Maryland plant
lion
gallons
daily "of
codling
water.
Most
of lis
water
if
.fr™of Chesapeake
but Phet
because
its salinity Bay
this
nUSL
sewage
Back
i
For
has
an-
purpose the
used the
1942
S1,nce
z aser rde
^
effluent produced at the
River
I
+
this
since
mS
Baltimore
treatment
J=saAn919rd treatment
'
plant whose output
to the steel plant.
CORPORATE and MUNICIPAL SECURITIES
is
transported
Daily
of
use
this effluent has risen to 125 million gallons.
Y?
#
Mon„
*
\ million gallons per day. Two of
nlants
tn
ho
HosicfnoH
the Plants were to be designed
the*
101,
ine
treatment
water and at least
use
exchange
Huntington Bank Building
15, OHIO
Teletype: CL 388
SECURITY
DEALERS
by various industries.
CLEARINGS
-
-
Cleveland
Pittsburgh
-
Toledo
Address Loans
partment.
-
Chicago
Cincinnati
and Securities De¬
Teletype: CV 240.
Bank Wire: NCLV.
LARGEST
-
98
52
Chemicals and drugs
Autos and aircraft
35
Iron and steel.
for
per
0
completion
Thi
**
250 000
day capacity plant for'
water is subjected to an elec-
Coast. One ofthe ^ * par^le^
located in the
Northern
Great
Plains and the other in the arid
grea^deaT Kterest
A greai _ae.al .P1 werest has
nas
been evoked in the saline water
,
and
nroeram
Pfograrn
ana
ap-
Diied
the
1 oration
of
one
of
Pllea I(?r location ot one ot tne
demonstration plants, supporting
nredirtion
brie comparFment
while
watnr flows through
to
25
Stone and glass
25
Lumber and furniture
23
Miscellaneous
22
Foods, beverages
Optical and medical
22
21
Plastics
19
Toys and sport goods
19
Nonferrous
18
metals
Machinery and tools
Apparel and textiles
15
14
Leather
12
of
*n(r. pr?dl9tl01?u 2
the
Offire
of
being
by Asaf11T unemTcai
- f
accomplished
Industry Company of Japan. En.
gineering
is
oemg
accompiisneu
by the Austin Company of Cleve-
-Vp. u"lce °{ land Ohio and Detroit Michigan
Saline Water that withm the next iana> unio and Detroit, Micnigan.
decade more than 1,000 cities will
Roswell, New Mexico is getting
be forced to convert saline or underway. This will be a one milbrackish water for drinking pur- lion - gallons - per - day - capacity
The final location of these
June, 1961. A descrip-
for brackish water con¬
version using the forced circulation vapor compression process,
This calls for water to be pumped
into a heat exchanger in an
plant
evaporation chamber where it is
boiled. The resulting steam
is
Freeport, Texas was dedicated
June, 1961. This is a 1 million
gallons per day capacity plant for
sea
water conversion employing
the long tube vertical multiple
effect distillation process. In this
process sea water is pumped into
a
series of vertical
evaporators
Underwriters
further heated in a compressor
so that it can be reused as the
evaporator heating medium beI°re being drawn off as fresh
water. Construction contracts
have not yet been let. Engineers
ar£ Catalytic Construction Co.,
Continued
Dealers
on page
Distributors
Office of Saline Water
acute
the
the
war
shortage
of
water
apparent
in arid
Municipal and Corporation Securities
of the nation and elsewhere
areas
and excessive
use of underground
throughout the country led
President Harry S. Truman
in
March, 1950 to request the Secrertary of the Interior and the heads
of several other Federal depart¬
ments and agencies to secure in¬
formation and legislation on the
large
scale
conversion
of
salt
water
The First Cleveland
Member Midwest Stock
National
This resulted in Congress
passing the Saline Water Act of
fice
of
Saline
Department
authorized
dean-
demonstration
Plants. Over 200 communities
for
(ions?
Plastic membranes block the ions
before they can reach. the elec
saitea water hows inrouton to an
other compartment. This plant is
me demonstration
.
,
* .
.
..
rupmipal
the
in
25
1952. The Act established the
Assets Over One Billion Dollars
gallons
to be located on the East
Coast, one on the West Coast and
water.
BANK
,
h
N
is
„South Da^?ta
i
November also, inis is a zou,uuu
was
tion of these plants follows.
Paper and pulp
After
We clear for dealers in
5
Percent
Petroleum
SPECIALIZED—PROMPT
New York
nf
^
scheduled
Planjs was to nave a capacity ot *
/
conversion
bv
n°f less tban 250,000 gallons per brackish
water conversion oy
'
®t
nla„f<?
electrodialysis. In this method
tion since
Telephone: 228-5391
brackish
of these
^
Industry:
COLUMBUS
ot
one
and the methods of conto be used have been
miff"
determined, and the first demonthostration
plant has been in operar6~
SWENEY CARTWRIGHT & CO.
members midwest stock
hrark-ish
Pannritv
poses.
.nj,leiWnn
nf
,
».
W e D S i e r,
wptp
trpafmonf
nf vfiT<? employed facilities
19? f, P? f j
version
fix
and
industry
with
companv
OHIO'S
municipal
struction costs of pilot plants and
consumed,: extending, the life of the program
plications.
Off
eco-
This
as
is
produced
steam is then
plant was constructed by Chicago
Bridge land Iron Company with
^he engineering work handled by
l.
Badger & Associates of
Only 2% of all the water used by
water is unsuitable for many
manv
CfO U.S.PAI
develop
condensed
long
steam
the
boiling.
by
Brine
tubes.
from
of
saline water to fresh water of a ^nn Arbor, Michigan. It will
9ua y. suitable for agricultural, water to the city of Freeport
wa-
and
.
converting sea water and other
subse-
be
us
living, but the
market
place is traditionally a
well informed, knowledgeable and
already
shall be
far
a
the finally decided to accept the uni¬
verse. "By gad, she'd better," said
and
position demands it,
before
to the matter of
rather far
market
initiative.
and
and
moved
committed to the principles of in¬
dividual
even
in values, as well as re¬
sponsible citizens, in the consider¬
ation of these problems. We have
uncer¬
to
and
dealers
have not
attention
preservation of the
purposes
of those
still
are
on
rather
a
I have urged the
interest of investment bankers as
and
political
interests
can
be
weighed, determined and acted
upon. We already have something
in the nature of an expression of
our common military strength in
NATO, although this is far from
being at its full potential. We may
have to set up some political in¬
stitutions
in
which these great
problems which for a long time
have been fully identified, can be
dealt with and a common policy
worked out in regard
to them.
covered
security and the problem of
peace
economic
common
our
front
world, and
better forms
and
have
is
perhaps rambled
a bit. I started out
by referring to
our balance of payments
problem,
trying to emphasize its relation¬
ship to our general position in the
advocating a new
but I do insist we
new
I
direction
rated
nest
a
water is boiled in¬
sea
these
side
comically feasible processes for
Much of this
reused, and it is evi-
be
can
that
dent
industry
wide
State
water
so
to
was
program
unavailable.
sections of the country.
as
Advocating
consumed
quently
ters
Now
I have suggested, be
good reason to give thought to this
objective,
but
the
Communist
moves
should
greatly stimulate
our own thinking in this direction.
not
gaining
momentum throughout certain
in this
,
,
Continued from page 68
policy and expressing
than has been the mestic and municipal purposes is
history when isolation or provin¬
cialism, or for that matter, nation¬
alism, has been proven inade¬
quate as it is now, it is almost
incongruous to hear that a tend¬
contain
tubes. The
Securities Committee
of
Communist world is in the process
ency
Thursday, December 28, 1961
Report of IBA Industrial
recur¬
of
marshalling vastly divergent
peoples and nations to the ac¬
ceptance of their strength and
their ideology. At the same time
it is doing its level best to keep
the Free World divided, off bal¬
.
.
which
it is obvious that
a
.
eco¬
field
by the productive
capacity of the Soviet Union and
its satellites. Our political posi¬
could be
ments
Chronicle
The Commercial and Financial
84
of
the
Water
the
under
Interior
appropriation
Corporation
Exchange
City E. 6th Building
CLEVELAND
14, OHIO
Of¬
the
Telephone PRospect 1-1571
Teletype: CV 443
-
QV 444
and
of
$2 million for a five year research
program.
The objective of this
Canton
Columbus
Sandusky
Toledo
Youngstown
85
Volume 194
Number 6120
.
.
.
The Commercial and Financial Chronicle
85
Continued jrom page 84
Philadelphia, Pa., a subsidiary of
Houdry Process Corp.
Wrightsville
Beach,
North
Carolina will be
plant
for
sea
by the freezing
this
approach
sea
In
water
turned
ice
is
crystals
into
and
slurry of
a
brine
either
by
in
water.
contact
The
ice
with
the
crystals
been let
and
sidered
Industrial
Securities
Committee
(Breakfast
Meeting)—-J. Victor
Milwaukee, Chairman
Loewi,
Loewi
<ft
Co., Incorporated,
as
Co.
are
high
for
Brownsville
were:
Texas;
Tampa Bay
that
salt
dissolves
that
the
process
solids.
Isabel,
area,
Florida
gineers
to
be
and
development
of
saline
or
basic
research
in
This
of
&
Mrs. John M.
and
the
most
that
may
break¬
Budgeted
*
*
expenditures
of
three-quarters
applied
research.
Thus far under the 1952 and 1955
laws, $9.3 million has been spent
the
this purpose.
for
Under the 1958
law
providing for demonstration
plants, appropriations totaling
$8.6 million through fiscal year
1962
A
to
UNDERWRITERS
have
been received.
part of the spending for reContinued
on
page
AND
AND
DEALERS
MUNICIPAL
IN
SECURITIES
MEMBERS
Stock
York
Midwest
Stock
Stock
Exchange
Exchange
Exchange
(Associate)
UNION COMMERCE BUILDING
CLEVELAND 14, OHIO
ASHTABULA
COLUMBUS
LIMA
Mr.
&
Mrs.
Chester
Harris, Henry Harris & Son, New
Wm. E. Pollock & Co., New
DAYTON
MANSFIELD
BOWLING
ELYRIA
GREEN
CANTON
TOLEDO
SPRINGFIELD
CINCINNATI
GRANVILLE
FINDLAY
HAMILTON
YOUNGSTOWN
York; Mr. & Mrs. Max Pollock,
York
Merrill, Turben
Co., Inc
&
(Established 1924)
MEMBERS
NEW
YORK
MIDWEST
STOCK
STOCK
EXCHANGE
EXCHANGE
American Vitrified Products
National
Brush Beryllium Company
Central National Bank of Cleveland
National Cleveland
Cleveland Trust
Cook Coffee
Company
Ohio Leather Co.
Taft Broadcasting Company
Company
Hanna Mining
City Bank of Cleveland
Corp.
National Screw & Manufacturing Co.
Northern Ohio Telephone
Company
M. A. Hanna
Techno
Company
Fund, Inc.
Union Commerce Bank
Higbee Company
U. S. Truck
Inland Homes
Warner &
Corp.
Statistical Information
Lines, Inc.
Swasey Company
Available Upon
Request
•
1612 Union Commerce Bldg., Cleveland 14, Ohio
Trading Dept. CV 67
Telephone
MA
Municipal Dept. CV 865
1-6800
BRANCH OFFICES:
Canton
Logan V. Pratt, R. S. Dickson & Co., Inc.,
Podesta eft Co., Chicago; Marshall H.
Charlotte, N C.; Mr. & Mrs Glenn R. Miller, Crutten
Johnson, McDantel Lewis & Co., Greensboro, N. C.
•
Columbus
•
the
development have been about
Mcdonald & company
AKRON
the
pro¬
permit'at¬
major
Heimerdinger, Walter, Woody & Heimerdinger, Cincinnati; Mr. & Mrs.
E. Watson, Zikla, Smither & Co., Inc., Portland, Oreg.
American
of
remains
Richard
New
ef¬
Office of Saline Water for research
water
contrast
CORPORATION
en¬
means
and
a
*
applied research. Low cost saline
Mr.
dissolved
effective
an
the
reverse
through.
conversion, although its efforts to
date have
been
primarily con¬
fined to engineering development.
It hopes to devote more emphasis
to
very
one-quarter for basic research and
in
work
and
water
conversion
of
tainment
research
brackish
in
continuous, fundamental
research.
The Office of Saline Water has
field
that
discovered
is
gram
and
in
low
at
requires
economical
water
foundation
Research and Development
interested
to
water
it
scientists
agree
and
saline
Oklahoma.
very
Most
fective
(Bradenton); Key West, Florida;
Elizabeth City,
North Carolina;
Virginia Beach, Virginia; Atlantic
City, New Jersey; Suffolk County,
New York (Long Island); Wichita
Falls, Texas; Alamogordo, New
Mexico
and
Oklahoma
City,
been
do
to
might be possible to
process
to
remove
plant
Port
-
the
how
little energy. If it was also known
this
was
accomplished, it
the list of appli¬
on
demonstration
a
convert
how
con¬
likely candidates.
ranked
to
but
„
Other communities needing ad¬
ditional
water
facilities
which
cants
not
are
known, but how they occur
is. not. It is known, for example,
have not
yet, but Carrier Corp.
Blaw-Knox
and
ideas
New
siderable magnitude. The end re¬
sult of many natural phenomena
then
mechanically and melted
into fresh water. Engineering for
this plant will be done by The
Lummus Co., New York, N. Y.
contracts
date.
cost. This presents many chemical
and mechanical problems of con¬
removed
Construction
a
challenge
satisfactorily
processes are
fresh,
sea
are
to
is
cooling with flash evaporation in
high vacuum chamber or by
evaporating a hydrocarbon sol¬
a
vent
solved
is
not been
needed and can
be
achieved
only through fun¬
damental
research.
Existing
processes can be improved upon,
but are probably not the best that
can be developed.
The big problem in this area
water conversion
process.
conversion
has
new
250,000-gallons-
a
per-day-capacity
water
which
Dayton
•
Middletown
•
Youngstown
86
86
Mr.
&
The Commercial and Financial Chronicle
Mrs.
Frank
L.
Reissner,
Indianapolis
Bond
<ft
Share
William
F. Gliss, John C. Legg <ft Company, New York; Joseph W.
Sener, John C. Legg & Company, Baltimore; Philip 0. Rogers,
John C. Legg & Company, Baltimore
Corporation, Indianapolis; Charles A. Capek, Lee Higginson
Corporation, Chicago
Continued from page 85
Carolina
search and
Memorial
and
Ohio.
contact freeze process.
development has been
for pilot plants. A pilot plant is a
small research facility designed to
test and develop new or improved
and
under
are
one
the
at
Battelle
Institute,
Columbus,
Four
electrodialysis units
test
at
the
Bureau
veloped by Blaw-Knox" Company
ver,
iso-butane
an
Extension of Work
Laboratories,
Den¬
Colorado. A 15,000 gallons per
of Office
day
and
interest
with much larger capacity
than a pilot plant, to provide data
on engineering,
operating and eco¬
the
fact
Wrigntsville
tions and time limits
nomical potential of
evaporation
designed
as
was
production
a
unit,
process.
are
in
lina.
conversion
a
It
planned. Two distillation research
facilities
pilot
are
plants
velopment
Florida.
operating at Harbor
a
at
A
North
direct
process.
distillation
A number of pilot plants
operation and more are
Beach,
utilizes
Caro¬
freeze-
Three
are
solar
under
Daytona
de¬
Beach,
35,000-gallons-per-day
plant
is
located
at
St.
Petersburg, Florida. This
was de-
view
In
out,
of
the
original
Congress
matter
importance of
this program and
in
that
has
appropria¬
running
are
taken
the
up
of
extending this work.
held by Congres¬
sional Committees this spring and
Hearings
House
were
with
summer
the
result
that
the
of
Representatives passed
authorizing an additional
million for the saline water
bill
a
Island, Wrightsville Beach, North
of
Saline Water
freezing process pilot plant
developed by the Carrier Cor¬
poration and is in operation at
hand is
direct
of
Reclamation
saline water conversion processes.
A demonstration plant on the other
utilizes
$50
conversion program and extended
its time
for
an
additional five
beyond 1963.
years
CORPORATE AND
COMMON
AND
MUNICIPAL
PREFERRED
ISSUES,
STOCKS
Shortly there¬
final
The
span.
$75 million for
com¬
a
six
period (fiscal 1962 through
fiscal 1967). This bill (H. R. 7916)
has been passed and become law.
It is apparent, therefore, that a
vast
CURTISS, HOUSE & CO.
place
over
of
governmental
this
field
will
the coming
future
ac¬
take
years.
program
will
em¬
phasize broad basic, fundamental
research to supply new ideas and
data to develop the best and most
Members
economical processes and methods
Exchange, Midwest Stock Exchange,
American Stock
in
The
Established 1914
New York Stock
stepup
tivities
for
Exchange (Associate)
converting
water suitable
saline
water
into
for beneficial
con¬
sumptive purposes. Low cost de¬
Union Commerce
salination
Bldg., Cleveland 14, Ohio
tive.
the
ultimate
of
objec¬
recovering and
marketing commercially valuable
byproducts resulting from saline
MAin 1-7071
water
New York
is
Methods
conversion
will
also
be
studied.
Correspondent : Clark, Dodge & Co., Incorporated
Cost Factors
in
Saline
Water
Conversion
In its work thus
UI||||||||||||||||||||||||||||||||||||||||||||||||||||||||||i|||||||||||||||||||||||K|||||||||[U
far, the Office
of Saline Water has
accomplished
satisfactory results. One of
these has been to reduce the cost
many
of
§ UNDERWRITERS
producing fresh water through
During
in which existing leg¬
conversion of saline water.
AND DISTRIBUTORS
|
I
OF
1
1
INVESTMENT SECURITIES
1
CORPORATE
•
the period
islation
has been
operative the
converting water has been
reduced from $5 to $1 per
1,000
cost of
gallons.
Much
credit for
this
re¬
sult must go to private companies
that have been active in this field
for some time, but the Office of
Saline Water has pushed forward
work and directed efforts to
MUNICIPAL
the
develop
processes
and
plants
which have been of great help in
Prescott&Co.
1
S
MEMBERS
|
E
STOCK
Prescott, Shepard
=
E
NEW YORK
1
EXCHANGE
Co., Inc.
&
NATIONAL
CITY
BANK
5HAKER SQUARE
•
BLDG.
•
CANTON
PR.
•
1-6300
•
CLEVELAND
COLUMBUS •
14, OHIO
TOLEDO
be
a
tions. It must be
|
ever,
=
E
recognized, how¬
that achievements have been
largely engineering, and from this
point on, it will become increas¬
ingly difficult to lower conversion
costs
any
further with existing
processes.
rive
HIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIMIIIIIIIIMIIMIIIIIIIIIIIIIIIIIIIMIIIIIII IIIIIIIIIIIIIIIlrT
factor in further cost reduc¬
=
E
(AFFILIATE OF PRESCOTT & CO.)
900
reducing costs. It is expected that
demonstration plants now oper¬
ating or scheduled to operate will
from
course.
Some benefits will de¬
larger
plant
size,
of
It is possible to extrapolate
George T. Flynn, Hornblower & Weeks, New York"; Willard G.
De Groot, Bateman, Eichler & Co., Los Angeles; Robert A.
Podesta,
Cruttenden, Podesta & Co., Chicago
j: ■
.
20
their
year
amortization
and
an
in¬
month. Thus the actual cost in
per
such
a
town is likely to be far
higher than the water bill. All of
these
extra
avoided
this
jective is to provide water at a
price of 400 or less per 1,000 gal¬
lons to make it economically at¬
tractive for industry and munici¬
pal uses in the more critical areas.
tization
However, in determining what is
a
competitive price, it must be
understood
that
there
are
into
factors
should
consideration
be
also.
taken
For
one
thing, the figure of natural water
cost may not
the
actually be
consumer
as
ized
water
chase
cheap
is led to believe.
and
the
facilities. In
include
original
amor¬
cost,
in¬
terest,
maintenance, power and
salt for regeneration and softener.
When you add these all together,
it is
likely to be found that costs
1,000 gallons used may well
exceed $1.
per
It
should
also
be
remembered
that many areas of
the country are
actually paying far higher water
bills than the 400 per 1,000 gal¬
lons figure. These are arid places
or
those
problem
that
in
have
special
adequate
some
obtaining
supplies of
water
ample, the city of Coalinga, Cal¬
bill may
of
bottled
drinking water
$3-$6 per month; (2) home soften¬
ing $3-$10 per month; (3) excess
corrosion due to the highly min¬
eralized nature of the water $4-$6
per
wells
expenses
of
people have
some
town
using highly mineral¬
where
the
monthly
be $4-$5, the fol¬
lowing additional water expenses
might be commonplace: (1) pur¬
a
hie
An
areas
wide
variations in water rates through¬
out the country. A number of ad¬
ditional
case
would
distilled water.
expenses
with
own
terest rate of 4%. The desired ob¬
In
was
Thursday, December 28, 1961
suburban
as
year
.
specific plant into one of greater
capacity and envision cost savings
up to optimum maximum.
In determining the cost
factor,
the capital costs of the converting
plant are included on a basis of
ten
promise
.
a
after the Senate approved legisla¬
tion to spend $100 million over a
year
.
month; (4) excessive
consump¬
tion of soaps and detergents $4-$5
ifornia
water
own
was
fresh water.
forced
to
For
haul
ex¬
fresh
in
by tank cars when its
supply became too salty. Its
costs for this water
was
1,000 gallons. About two
Ionics, Inc. constructed
$9.35
per
years ago
an
electro-
dialysis plant here by which the
city is
water
now
getting
its
domestic
supply at about $1.45
per
Volume
Hen|T
Mr.
R-
Kieper,
Mrs.
&
194
Kurt
Number
1,000
a
In
of
a
location
recent talk by the president
Water Service Company
made to
report of
a
the Ohio Division of Water stating
that water has too long basked
under the halo of
as
being regarded
cheap utility. A more realis¬
a
tic
appraisal suggests that water
going to cost more money or
there will be growing problems
is
of so-called water shortages. Ohio
is
state
enjoying ample water re¬
The
president
pointed
out that the water supplier is not
selling water but water service.
a
sources.
With
an
expanding population and
water
of
usage
water service
ice
has
and
attendant
problems, this
become
serv¬
costly and
requires higher water rates. With¬
more
either
them
out
subsidization
A
is
service
the water
will become inadequate.
necessary
.
The Commercial and Financial Chronicle
or
for special crop purposes. Normal
Some
prices
water
run
from $1.50 to $4.00
per
acre-foot. Thus at this point con¬
version water for agriculture does
not
appear economically
in this country.
Contracts Let By
feasible
the
Office
of
contribution
important
most
the
of
Office
of
private water consultant has
to
convert
saline
pipe in fresh
supply.
water
than
to
otherwise boost
or
Water for
irrigation is generally
available at far lower prices per¬
haps in the area of 12^ or less
per
1,000
gallons.
Agricultural
water
measured
is
acre-feet.
lons in
There
are
in
terms
326,000
of
gal¬
acre-foot. It does not
one
presently
used conversion processes will be
able to provide water for irriga¬
tion at less than $100 per acrefoot. This compares with the high¬
est price now being paid in the
United States of $25 per acre-foot
now
appear
that
any
for
sea
brackish
especially
waters.
Some
household
installations, others are most
economically feasible in multimillion gallons per day capacity
plants. Additional factors deter¬
mining suitability are associated
with
location, such
as
fuel costs,
weather
conditions and product purity re¬
of
industry
in developing low cost saline wa¬
ter conversion processes. Through
funds at its disposal it has let
contracts to a large number of
private corporations as well as re¬
search organizations for work in
various phases of this field and for
the construction of demonstration
plants. In addition it has partici¬
pated in technical meetings and
activities of the American Chem¬
Society, American Institute
of Chemical Engineers and Amer¬
ican Water Works Association.
Bermuda
John McG. Dalenz, Calvin Bullock, Ltd., New York; Sidney S. Blake,
Janney, Battles <ft E. W. Clark, Inc., Philadelphia; Robert E. Clark,
Calvin Bullock, Ltd., New York
(Hotel Service)
Griscom-Russell
are
adaptable for use in
type units
or
other
stimulate the interest
conditions, waste disposal
quired.
Destroyers
All
Other
use
on
surface
ships
Conversion
Principal
Processes
units
its ex¬
istence for a number of improve¬
ments
in existing processes for
saline water conversion and has
explored new ones. There are at
present four principal processes
for conversion of saline or brack¬
ish water. These are distillation by
boiling,
mem¬
exchange
ion
and
brane
distillation,
solar
and
freezing. Much more research and
work
development
Different processes
will be
tages
is
needed.
have been and
developed having advan¬
for
particular applications.
in
and
with heat
pro¬
of
on
ocean-going vessels
of
16,000,000 gallons daily.
Arid
Regions of the World
Besides
own
our
many
country,
types, with the heat source being
supplied by turbine bleed steam.
throughout the rest of the world
Aqua-Chem, Inc. has been es¬
pecially active in navy and com-
be
there
are
many
classified
plagued by
a
as
also
includes
total
regions that
can
arid
are
or
that
chronic inadequacy
of fresh water.
These include the
installed
Continued
capacity and type of system.—Ed.
on
page
There
water
are
a
number
conversion
of
units
saline
now
in
commercial
operation in this
country and other parts of the
world in addition to those already
mentioned. Most of them employ
the distillation process.
Among
these are the following:*
Butler,Wick
Aruba
MEMBERS
New York Stock
(Persian Gulf)
Westinghouse
Kuwait
(Persian
Gulf)
Valley Mould & Iron
Commercial Shearing & Stamping
Youngstown Fdry. & Machine
Dollar Savings & Trust Co.
Youngstown Research &
Mahoning National Bank
Development
Guernsey
G. & J. Weir
Las
Sawhill Tubular Products
Union National Bank
Century Food Markets
(Caribbean)
& J. Weir
of
Ohio Water Service
Bessemer Limestone & Cement
G. & J. Weir
Isle
Ohio Leather
Automatic Sprinkler
Atlantic Register
Nassau, Bahamas
G.
Exchange
Ajax Magnethermic
American Cement
Weir & Westinghouse
Curacao
Exchange
Exchange (Associate)
Midwest Stock
& J. Weir
Kuwait
Company
(Established 1926)
American Stock
(Caribbean)
&
Piedras,
6th Floor Union National Bank
Venezuela
Griscom-Russell
Kuwait
Bldg.,
Youngstown 1, Ohio
(Persian Gulf)
TELEPHONE
Richardson, Westgarth
BRANCH OFFICES:
RI
4-4351
Alliance, Salem, Warren, Ohio; Franklin, Sharon, Pa.
Marcus Hook, Pa.
Westinghouse
Mirafiori, Italy
Escher-Wyss
Virgin Islands (U. S. Govt.)
Aqua-Chem
Kindley Air Force Base
They
live in big
cities, in towns and vil¬
lages,
IN OHIO
few
on
farms. Quite
customers
are
a
of
(Bermuda)
Aqua-Chem
'
Aircraft Carriers (U. S.)
All manufacturers
(each)
Saunders, Stiver & Co♦
Gibraltar
(Established 1932)
Aqua-Chem
ours.
Dharan
Air
Force
Base
(Arabia)
Aqua-Chem
Personal contact with
these
investors—
Pacific Gas & Electric
(Morro
Lummus
investors
are
through
our
eighteen
sales offices and
everywhere
our
newly constructed main
office
—
helps build dis¬
tribution.
Bay, Calif.)
Company
Buenos Aires, Argentina
Escher-Wyss
Underwriters and Dealers in
Municipal and Corporate Securities
Thule Air Force Base
(Greenland)
Mechanical
Govt,
of
Equipment
Ecuador
(Salinas)
Aqua-Chem
One Terminal Tower
Cleveland 13, Ohio
CV
PRospect 1-4500
283
Arrowhead & Puritas Co.
51 N. High St.
THE
OHIO
COMPANY
Member of the Midwest Stock Exchange
investments
Columbus 15, Ohio
88
Installations
G.
during
responsible
are
vided by the atomic reactors, and
*Table
Principal Commercial
The Office of Saline Water has
been
com¬
ship installations.
past twenty years this
has designed and manufac¬
over 4,000 distillation units
with a total fresh water capacity
submarines
run
Over
the
tured
distillation
atomic
mercial
pany
(each)
manufacturers
Location and Manufacturer:
of
$1.00 per thousand gallons,
some
11,000 communities in the
next 15 years will find it cheaper
best
are
Saline Water thus far has been to
ical
estimated that at conversion costs
ing
processes
conversion, others for treat¬
small
Saline Water
Perhaps
87
A. Peter Knoop, Auchincloss, Parker & Redpath, New York; Paul
L. Mullaney, Mullaney, Wells & Co., Chicago; Chuck Miller,
Mullaney, Wells & Co., Chicago
York
Ohio
was
.
York Hanseatic Corporation, New York;
Grunebaum, New York Hanseatic Corporation,
gallons.
For this
price is cheap.
reference
.
New
H.
New
such
6120
(Los Angeles, Calif.)
Aqua-Chem
Southern California Edison
(Oxnard, Calif.)
Aqua-Chem
MEMBER
MIDWEST
STOCK
EXCHANGE
The Commercial and Financial Chronicle
88
Continued from page 87
water
Southern coast of
comments
Israel, the North
coast of Australia, the West coast
of South America especially Chile,
Kuwait, Pakistan, Cyprus, Aruba,
the Virgin Islands and Hong Kong.
Other large areas have
nothing
brackish
than
better
water
"The
and
.
.
Thursday, December 28, 1961
following
made:
were
growth
the
in
absolute
-
capita demand for fresh
water is not alone a U. S. prob¬
per
lem; it is also an international
problem of challenging propor¬
tion.
Indeed, grave as forecasts are
concerning the adequacy of pres¬
sup¬
embrace the whole
belt across Central Asia, the Mid¬
dle East, parts of India, Pakistan,
Iran, South America and Austra¬
lia, North Africa, West Africa,
South
Africa, Mexico and
the
These
plies.
the
conversion,
.
ent
future
and
supplies of fresh
States, when
water in the United
compared to the quantity of water
available
on
a
capita basis in
per
most other countries of the
United
the
Caribbean Islands.
States
is
world,
of
one
the
water-richer countries. At least 60
Global Importance of Conversion
the
of
100 underdeveloped
Most interest in the water situ¬
tries
and
of
with
the
ation
in
is
our
country,
own
coun¬
associated
territories
Nations
United
face
but in today's world for¬
eign affairs and policies are of
vital ' importance.
The immense
proportion of the subject of sa¬
line or brackish water is perhaps
forms of water shortage
brought into better perspective by
recognizing the fact that it con¬
cerns 90%
of the earth's surface.
conversion projects of the United
States are of great interest to the
course,
time
brackish
is
this dry land can be
ex¬
pected to experience increasingly
disturbing social problems to
which a rising need for greater
supplies of fresh water for agri¬
and many other needs
cultural
of them are
will contribute. Few
in
a
own
position to help
solve their
difficulties.
then
Here
In
a
Special
ternational
Nations
cost.
Mrs.
Lockett
Shelton, Republic National Bank, Dallas; Mr. & Mrs. Alan
Bank of America, N. T. & S. A., San Francisco
K. Browne,
exaggera¬
Some
of the
coun¬
already
semi-arid
saline
of
importance
In¬
the
regarding
&
the
areas
to
key
political stabilitv and progress is
tied to their obtaining substan¬
tial amounts of drinking water,
and water for livestock and agri-
Managing
United
the
Fund
Mr.
say
are
and
of
Director
no
water
experiencing
rationing and price
control of
water; and in certain of the arid
tries
us.
statement by the
saline
reason,
from
sources.
may
sonable
of foreign
ficial to
is,
water
tities of essential water at a rea¬
is an
aid in which our
assistance
would
be
invaluable
and at the same time highly bene¬
area
this
to
States
countries whose territory encom¬
passes
salt
that what the United
accomplish in solving
this problem, whose significance
is growing in America, could have
tremendous impact in other parts
of the world—in Africa, the Mid¬
dle East, Asia, and Latin America.
In many countries in these areas
the pace of economic development
is strongly influenced, if not con¬
trolled.
by the development of
techniques to obtain large quan¬
tion
the
of
Most
land.
dry
that
sources;
and
United Nations. It is
Nearly three-quarters of the globe
is covered with salt water, and
of the remaining
quarter some
60%
only be met from non-
can
traditional
"For
which in
Continued
on
page
89
Mr. & Mrs. J. B. Sanford, Jr., Hattier & Sanford, New Orleans; Fred D. Stone, Jr., Marine Trust
Company of Western New York, New York City; Rucker Agee, Stern, Agee & Leach, Birmingham;
Charles E. Cady, Cady & Co., Columbus, Miss.
WALTER, WOODY & HEIMERDINGER
Dixie Terminal
403
Cincinnati
M. H.
Bldg.
Ohio
2t
Woody
John N. Fuerbacher
Bell
Carl A.
X-5071
Main
Phone
John M. Heimerdinger
John E. Froehlich
System Teletype CI
188
Muething
Specializing in the purchase and sale of
MUNICIPAL
and
tax
revenue
BONDS
Lewis
M. Krohn, Ira Haupt &
York;
r
William
Co., New York; A. Peter Knoop, Auchincloss, Parker & Redpath, New
M. Cahn, Jr., Halle & Stieglitz, New York; Carl Stolle,
G. A. Saxton
Westheimer
-
Co., Inc., New York
throughout the
Center
West...the
great Mid
&
of Industrial America
O
O
CHICAGO
CLEVELAND
I
MARION
i
I
O
LANCASTER
DAYTON
o
HAMILTON
GREENSBURGO
|
ATHENs f
"
O WASHINGTON C.H.
O
CINCINNATI
WHEEUN&
O
CHILLICOTHE
O
O HILLSBORO
CHARLESTON
HUNTINGTON
O
o
326
Walnut
Cincinnati
and
Telephone:
Company
Teleytpe:
UNDERWRITERS
Members
NEW
Principal
YORK
-
—
Exchanges
DISTRIBUTORS
—
CINCINNATI
V
Direct
Wire:
MAin
Ohio
1-0560
CI 585, CI 232
—
Hayden,
TELEPHONE:
Street
2,
DEALERS
Stone A
WOrth
Co.
6-2115
Edward K. Hardy, Jr., Illinois Company of Chicago, Chicago;
J
Chicago;
Anthon
H.
William
Lund,
Amott,
Robert M. Clark, Blunt Ellis A Simmons,
A Co., Incorporated, New York;
Barney A Co., Chicago
Baker
E. Fay, Jr., Smith,
Volume
Mr.
&
Edward
Mrs.
Number
194
H.
Austin,
6120
E. H.
.
.
.
Austin
Continued from page 88
The Commercial and Financial
&
Co., San
Saline
required by their rapidly
growing populations."
Conversion
Water
American
culture
Mr.
Antonio
Machine
&
&
Devices
Foundry
Bendix
Privately
There
are
water plants
of which
70%
privately
are
owned. It has been estimated that
supplies that
inadequate
for dry year' demands. Most of the
water companies have
bacterio¬
logical laboratories engaged in a
constant check
ply
in
and
are
research
to
methods of treatment. As
epidemics
which
water
now
to
from
In
rare.
eliminate
used
to
result
tainted
occur
addition to
foreign
a
of
use
are
filtering
matter
of
water
raw
Research
and
Chance Vought
American
care
Union Tank Car
of
&
Tiernan
Softeners
Permutit
Tank
Car
Chemical
Goodrich
F.
Equipment
Badger Meter
Link-Belt
rapidly enhancing
feasibility is likely to
become increasingly appealing to
economic
Ionics
The
I
development work and construc¬
tion of additional pilot plants.
It
also
provides
that
construction
and
operation of demonstration
plants or participation in their
construction and operation must
The
problem of financing sa¬
conversion facilities
water
contemplated by states, munici¬
palities, agencies or other bodies
or organizations is one.that should
be considered, particularly from
reasonable
constitutes
terms.
reasonable
What
terms
is
largely determined by the rate at
which
money
is
as
low
as
These
loans
be made to cities of any size
for any type of public works ex¬
cept those already receiving fed¬
Whether they
aid.
eral
available
version
saline
for
facilities
would be
water
remains
:V;
seen.
Role of the
When
it
con¬
to
be
>
.
demonstrated
competitive
economically
use.
aside from Federal contracts.
over
that
to
private
further advancement of the work.
Investment bankers
can
assume
important position in arranging
an
to raise
necessary
uses
funds for plant
and
construction
other
applied
of conversion processes.
likely to become
development in the face of rising
interest in conversion and attendContinued
plants
on
page
MEMBERS
YORK
Secretary of the Interior to Con¬
STOCK EXCHANGE, MIDWEST STOCK EXCHANGE
ASSOCIATE MEMBERS
AMERICAN STOCK EXCHANGE
Underwriters
•
Distributors
•
Dealers
gress.
Federal
Government Financial
Government, Municipal and Corporate Bonds
As~isfance
Listed and Unlisted Stocks
Originally the bill carried
pro¬
visions for loaning money to mu¬
of plants
to be
supplemental fresh water
These loans
be
to
as
well
as
con¬
used
CLEVELAND
as
14, OHIO
sources.
grants were
ASHTABULA
•
AKRON
•
COLUMBUS
•
DAYTON
•
LORAIN
•
MANSFIELD
•
MENTOR
liberal terms and
in amounts up to 90% of the total
cost.
The
thinking behind this
on
very
financial assistance
the
advanced
most
saline
known
was
of
water
that
even
presentlv
conversion
must be considered as at
partially experimental.
Therefore, any organizations find¬
ing it necessary to turn to con¬
verted water as a source of supply
might have difficulty obtaining
financing in the open market and
would probably also have to pay
high interest rates.
processes
Building
The
final bill, contains
all funds
of
are
Field, Ricliards
pro¬
objective
attaining low cost desalination.
will be, therefore, oppor¬
There
Underwriters and Distributors
Of
Municipal & Corporate
tunity for banking institutions to
Securities
private or public financ¬
Government's declared
approach to this problem is not
from the standpoint of trying to
arrange
ing.
State, Municipal
and Revenue Bonds
The
the utility business, but
stimulate,
encourage
provide consultation and direct
the development of economically
get into
rather
feasible
saline
water
conversion
and to, in effect, "get the
rolling" in their practical,
useful
1556 Union Commerce
to
processes
ball
Co.
ESTABLISHED 1908
or
basic research with the
CV-46
no
grants. Rather
to be used for broad
visions for loans
Ohio
commercial application.
Bldg.
1107 Union Central Bldg.
CLEVELAND 14, OHIO
CINCINNATI 2, OHIO
Telephone PRospect 1-2770
Telephone Main 1-3776
Teletype—CV
174
This
ballooning
a
BALL, SURGE & KRAUS
NEW
it
for
corporations
least
Ginther & Co.
This
draw from the program turning
is
Investment Banker
is
even
own
permit industry to
work in this field
lend
can
recently reduced
3%%.
as
from
profit
their
be authorized by separate legisla¬
tion upon recommendation by the
struction
Monsanto Chemical
Westinghouse Electric
Whiting
Eventually the Government may
be expected
to gradually with¬
on
for
will
turn
ex¬
panding appropriations contem¬
plates
extensive
research
and
nicipalities and others for the
line
Struthers Wells
able
in
Congressional Bill extend¬
ing the Saline Water Act and
Worthington
Koppers
are
them.
Rockwell Manufacturing
Financing Saline Water
Conversion Facilities
Grace
Griscom-Russell
using
cost reductions
Dorr-Oliver
General Electric
MAin 1-9445
at
all, the prospect
conversion plants with
Chain Belt
FMC
Commerce
of needs
satisfy
American Meter
Electric Storage Battery
Fluor
Cleveland 14,
minishing or at best static sup¬
plies, often of a brackish quality.
Pfaudler Permutit
Allis-Chalmers
Ets-Hokin & Galvan
Union
di¬
demand, if it is possible to take
Union Tank Car
Chemical
R.
iniposed
bur¬
Nalco Chemical
Sterling Drug
E. I. du Pont de Nemours
W.
nothing of
Faced with rising costs to
B.
Curtiss-Wright
Dow
demand
say
Hagan Chemicals & Controls
Dow
Temco-Vought)
country, to
The
be built, many organizations
likely to become interested in
constructing and operating such
can
facilities
on
Allied
(now Ling-
plants
Government.
geoning
Fluor
Carrier
demonstration
water
the
Fischer & Porter
Construction
Blaw-Knox
saline
of
Gardiner, Reynolds & Co., New York
Community Facilities Administra¬
tion makes loans to municipalities
to finance public facilities if the
financing is not otherwise avail¬
may
Dravo
Development
the
cies
a
Union
Field
Aqua-Chem
conversion
for
be
fresh water in the face of
Sewage and Waste Disposal
Treatment
be able to
may
Culligan
Pfaudler
Companies Active in the Water
made
were
Nalco Chemical
List of Leading Publicly Owned
banker
Crane
Hagan Chemicals & Controls
included, such
as use of alum, lime and iron to
aid sedimentation, chemicals,
mainly chlorine, as disinfectants.
Federal financial assistance may
available through other agen¬
standpoint of the role the in¬
vestment
Mr. & Mrs. Robert M.
which the Administrator
Conditioning & Treatment
Culligan
are
Co.
the rest of the world, are gradu¬
ally feeling the pinch of inability
to
supply adequate amounts of
Water
bacteria, other forms of treatment
&
Westinghouse Electric
Wallace
and
Noyes
in this
Transportation
improve
Hemphill,
North American Aviation
General
the water sup¬
on
Noyes,
Ionics
Water
about 20% of these water systems
have
the
Blancke
authorized by the Office of Saline
Water. It has also been indicated
that more and more communities
Griscom-Russell
approximately 18,000
in the United States
over
Steel
Fairbanks Whitney
General Electric
Owned Water
Companies
Mrs.
play. It has been mentioned pre¬
viously that many applications
Aqua-Chem
Bethlehem
89
Chronicle
Teletype—CI
150
91
90
The Commercial and Financial Chronicle
.
.
.
Thursday, December 28, 1961
i
lr
■■
Mr.
<£
&
Mrs.
Company,
C.
Josephus R. Corbus, The Illinois Company, Chicago; Donald T. Fletcher, William Blair
Chicago; Edward K. Hardy, Jr., Illinois Company, Chicago; Mrs. Marsom B. Pratt;
Duson, Rotan, Mosle & Co., Houston; Marsom B. Pratt, Estabrook «fi Co., Boston
Pharr
Jim
i
Initiates: Herman B. Joseph, Joseph, Mellen & Miller, Inc^ Cleveland; Robert Mason,
Lynch, Pierce, Fenner & Smith Incorporated, Chicago; Curtis H. Bingham, Bingham, Walter
Hurry, Inc., Los Angeles; Emil J. Pattberg, Jr., First Boston Corporation, New York
Daisy
Merrill
&
11
Alfred
J-
Bianchetti,
Kenneth
J.
J. A. Hogle & Co., New York; Mr. &
Howard, J. A. Hogle & Co., New York
Mrs.
William
L.
Hurley, Baker, Simonds & Co., Inc., Detroit; Francis J.
Cunningham, Kidder, Peabody & Co., New York
Logan V. Pratt, R. S. Dickson <ft Co., Inc., Charlotte, N. C.; John M.
Heimerdinger, Walter, Woody & Heimerdinger, Cincinnati
^\
Mr.
&
Mrs. John
H.
Brooks, Putnam & Co., Hartford; Forrester A. Clark, H. C. Wainwright & Co.,
Boston; Louis Walker, G. H. Walker & Co., Hartford
Edward
H.
Robinson, Schwabacher & Co., New York; Mr. &
Meyer & Fox, Los Angeles; Joseph C. Nugent,
Aaron R. Eshman, Stern, Frank,
Mabon & Co., New York
Mrs.
i 3
Joseph Vostal, Kidder, Peabody & Co., New York; Mr. & Mrs. Arnold J.
Kocurek, Rauscher, Pierce
& Co., Inc., San Antonio; Mr. & Mrs. Richard N.
Young, Kidder, Peabody & Co., Philadelphia
Mr.
&
Mrs. Donald
E.
Barnes, C. F. Childs & Co., New York; Mr. & Mrs. F. Newell Childs
C. F. Childs & Co., Chicago
Volume 194
Number 6120
.
.
The Commercial and Financial Chronicle
.
Continued from page 89
sharp
ant water problems and
well unfold.
improving
There is
economies.
of
Investment
Opportunities
Many attractive investments
ist in companies now actively
various
gaged
in
water
treatment
include
mercial
ex¬
en¬
phases of the
industry. These
companies producing com¬
applications
of
saline
water conversion
equipment, those
heavily
committed
in
research
and development work in newer
of
areas
conversion
ments in
the
domestic
for
and
industrial
providing im¬
processes
for
sewage
those
and
usage
diversified facet*
softening and purifica¬
water
tion
refine¬
and
existing processes, those
involved in
of
portant
treatment and
disposal and puri¬
fying of waste. There are also a
large number of companies on the
fringes of this field, manufactur¬
general it would appear that
the greatest investment rewards
may come in the smaller compa¬
nies and those whose business is
their
companies committed to accept¬
they are all con¬
ducting their own research, it also
ed processes. As
as
the Governmental
calls for spending essen¬
tially only for research, compa¬
nies strong in this area will be
the prime beneficiaries over the
next few years. Here again in the
sizable research
contracts will reflect markedly in
York, N. Y.
vistas
of
development and
open up. In this en¬
vironment many companies now
participating in the field will
surge
forward. Somp new ones
New
the
area
investor
INDUSTRIAL SECURITIES
J. Victor Loewi, Chairman
Loewi & Co.. Inc.
Witter & Co.
Moseley & Co.
York, N. Y.
Inc.
from
Smith, Barney & Co.
Chicago, 111.
Edward K. Hardy
ownership would
to
of
to
.
.
Uranium
Industry
before
had
INVESTMENT SECURITIES
this
country.
into
entered
originally
poundage
in
delivered
Teletype CV 349
National Bank Bldg.,
Painesville
our
kilowatts
capacity each year
yearly supply of
oxide.
if
Even
atomic
Member
con¬
after
few
a
uue
1962.
to
there
again emphasize that
us
has
been
1VS itnSm
^
? J
mi
NavV to nuclear power will
fa fuf a^fv+°^
Sn£uSef
a
1 ^
other
fSin LleVef
2
S
f£w y?ars-
5?
i
•
uranium 0X1ue is used,
on^y thing that will definlteIy absorb our future uranium
Production is the peacetime
ence
oxide
per
contract
from
Therefore,
year.
with
Continued
on page
Co., Inc.
&
2100
the
previous arrange¬
East
Ohio
Building
Cleveland 14, Ohio
Fort
Akron, Ohio
Wayne, Indiana
United States and
separate contracts,
rather than jointly as was the
case previously through the Com¬
bined Development Agency.
In
by
the
under
our
country,
the
1962
present
production level of 17 to 18,000
tons will be maintained until the
end of 1966. The former Belgian
SERVING
Congo is no longer a supplier, nor
were
deliveries important before
UNDERWRITERS AND DISTRIBUTORS
independence was granted to the
Congo. Our total supply thus calls
for average deliveries of approx¬
imately 30,000 tons of uranium
oxide
each year
OHIO FOR 32 YEARS AS
OF HIGH GRADE CORPORATE AND
MUNICIPAL SECURITIES.
until the end of
1966.
In a projection of the future
consumption
of
uranium,
our
forecast must necessarily take into
account the time when atomic
energy
itive.
Union Commerce
Bldg., Cleveland 14,
Telephone CH 1-6220
for
will begin to be compet¬
Wm. J. Mericka
We indicated in our report
1959
uranium
that
about
oxide
are
Ohio
Teletype CV 1
&
Co.
inc.
Member of Midwest Stock Exchange
1,500 tons of
required to
Union Commerce Bldg.
yield the inventory for each mil¬
INVESTMENT SECURITIES
93
.1911 -1961
Under
South
that purchases of South
uranium will be trans¬
is
acted
MILLER & CO.
use
of atomic energy in the production of electricity.
Other future
applications such as reactors for
5C?li
effective Jan. 1 of this
year, the Uriited States will pur¬
chase
18,900
tons
of uranium
oxide between Jan. 1, 1961 and
Dec. 31, 1966. The main differ¬
Britain
HAYDEN,
if
stockpiling of
uranium so far, it is because most
of
it
has
gone
into
weapons.
Military demand will undoubtedly
no
ANNIVERSARY]
be
Africa,
African
SINCE 1903
years.
and Can¬
production
revised
ment
INVESTMENT EXPERIENCE
nu¬
may
of the Midwest Stock Exchange
will taper
off gradually and by 1963 or 1964
the supply
sent to this country
should not exceed 5,000 tons of
uranium
Building, Cleveland 15, Ohio
million
6
began to find better
and higher grades of ore in this
country.
Today, Canadian con¬
tracts have been extended until
1966 without increasing the total
a
BRANCH: 206 Lake County
percentage
ada, we soon
Canadian
•
of that
be
milling capacity.
our
Let
Fulton, Reid
how
realized
we
in
had
we
we
tracts with South Africa
CHerry 1-5671
25%
to
10%
will
today, has performed
expectations.
As
you
uranium
Exchange
absorb
uranium
there was a rush some 10
back for contracting foreign
After
330 Hanna
the
new
At that time,
year.
capacity
and
grown
of
hands
beyond
much
Exchange
take
nuclear
to
know,
CO., INC.
new
this
point, we
have reactors begin to be competitive
placed the empnasis on the re- in some areas of the United States
actor itself.
Uranium, of course, by 1965, it will probably be 1975
is
the
starting point of atomic before anything like 5 to 6 milenergy.
The mining and milling
industry, which is entirely in pri¬
vate
Co., Inc.
Chicago, 111.
leasing
nuclear fuels.
of
The
York, N. Y.
Associate Members American Stock
kilowatts
by
of
Up
William E. Fay, Jr.
Members New York Stock
million
fraction of at least
ing
Report of IB A Nuclear
Industry Committee
over
Wertheim & Co.
&
30
grow
years
MURCH
this amount in the Free
another
Some time between 1970 and 1980,
we will have to think of expand¬
Allen C. DuBois
Illinois
10 years,
In
year.
world will certainly have
additional
Forum, which represents
Therefore, by adding the fuel
the equipment manufac- consumption of one million kiloturers and utilities, is now study- watts
of nuclear power for 20
ing the matter. Their recommen- years to the initial inventory, we
dation will undoubtedly be along reach an amount of about 5,000
the
lines of a sufficiently long tons of uranium oxide. Even if
transition period to minimize the we
earmark or commit future
economic impact of the change- consumption
for
20
years,
it
Gerald F. Brush
The
each
clear
most
Portland, Ore.
their commercial business rises, a
new
capacity
a
dustrial
Frederick C. Braun, Jr.
addition
total
guaranteed their supply for the taper off well before the present
next 20 years), we will have to uranium contracts expire. There
commit an extra 3,000 to 3,500 ls no Point in building atomic
would then, in turn, lease to re- tons of uranium oxide per million weapons for all time to come. The
actor operators.
The Atomic In- kilowatts.
wanet
°?
J?-e
once-
William B. Boone
Brush, Slocumb & Co.,
San Francisco, Calif.
a
of
the Government;
purchase by fuel fabricators, who
Bacon, Whipple & Co.
Chicago, 111.
New
Co., Inc.
Chicago, 111.
kilowatts
Continued from page 64
Milwaukee, Wis.
S.
That makes
million
capacity each
&
A. G. Becker
Hemphill, Noyes & Co.
New York, N. Y.
guaranteed
Gordon Bent
New
Noyes
are
World.
20
to
John W. Stodder
handsomely
Respectfully submitted,
F.
Space Corp.
c™^^v!SOrio
Ga.
Savannah,
could well
for many years to come.
Dean
of
York, N. Y.
Julian A. Space
York, N. Y.
we
kilowatts
equal amount for the rest of the
Free
to the fore. Selected in¬
vestments in this
reward
Dallas, Tex.
Riter & Co.
a
adding about 11
capacity to our
electrical utility systems in this
country annually. This amount of
power is matched by an
almost
Today,
H. Virgil Sherrill
Nix
added each year.
matter of eco¬
capacity is
entirely
is
million
Sanders
Richmond, Va.
emphasis may
may come
B. Reid
Shields & Co.
New
It
nomics.
J. C. Wheat & Co.
J.
cal
Sanders & Co.
L. Gordon Miller, Jr.
Blancke
concerns
sales and earnings. If in
New
City Bank
York, N. Y.
Jesse A.
Goodbody & Co.
kilowatts of nuclear electri¬
lion
First National
Fulton, Reid & Co., Inc.
Cleveland, Ohio
Thomas A. Larkin
New
future
Frank
Watling, Lerchen & Co.
Detroit, Mich.
burgeoning of this
industry seems undeniable.
It is
likely to gain momentum rapidly.
program
smaller
Pittsburgh, Pa.
New
Allen
The
Michael Pescatello
Hunter
The
offers substantial rewards.
corporate effort.
Inasmuch
W.
McKelvy & Co.
Herbert D. Hunter
in
water
growth characteristics of the in¬
dustry are likely to benefit these
concerns to a greater degree. For
numerous
large corporations op¬
erations having to do with water
treatment or conversion presently
constitute an insignificant part of
David
the risks involved in investments
activities. Provided
their management is capable,
the total
break¬
COMMITTEE
In
to
scientific
which
might
invalidate
existing methods. This is one of
ing studies in a limited area.
confined
of
cesses,
appliances, doing construc¬
researching or mak¬
treatment
very
may
through developing from research
investigations in conversion pro¬
tion work or
largely
pattern
always the possibility
sort
some
ing mechanical equipment, chem¬
icals,
growth
91
lion kilowatts of electrical gener¬
Cleveland
ating capacity. If, in addition, we
want to earmark the burn-up or
MAin 1-8500
consumption of uranium over a
20-year period (which is what we
have done with
Eura^om when we
v:
University Club Bldg.
Columbus
CAP
8-6136
The Commercial and Financial Chronicle
92
Group
Mr. &
S.
Chairmen's
Committee,
Breakfast Meeting—Paul W.
Chicago, Chairman
Fairchild,
Mrs. Howard Finney, Bear, Stearns
& Co., New York; Sidney
Blake, Janney, Battles <ft E. W. Clark, Inc., Philadelphia
Convention Golf
Committee
Taxation
Committee
Boston
Mr. & Mrs. George P. Rutherford, Dominion Securities Corporation,
(Breakfast
York
& Co.,
York
Education
Shearson, Hammill
&
Co,,
Shelby
Cullom
Morris
Committee
City, Chairman
Meeting)—Walter Maynard,
City, Chairman
New York
New
'
.
.
Thursday, December 28,-1961
Federal Securities Acts Committee, Breakfast Meeting—Albert Pratt, Paine, Webber, Jackson & Curtis,
Boston, Chairman
Corporation,
(Breakfast Meeting)—Mason B. Starring, Jr., A. C. Altyn
New
Federal
First
.
Mr. & Mrs. Donald
(Breakfast
A.
Davis,
Shelby Cullom Davis & Co., New York;
Schapiro, M. A. Schapiro & Co., New York
'
Meeting)—Robert Mason, Merrill
Incorporated, Chicago, Chairman
Lynch,
C. Patterson, Chemical Bank New York Trust Company,
Frank Kennedy, C. J. Devine A Co., New York
Pierce,
New
Fenner
York-
Mr
&
&
Smith
Mrs
Volume
194
Number
6120
.
.
Arthur Robinson, Industrial Bank, Providence, R. I.; Walter V. Kennedy, H. Hentz &
Mr. & Mrs. Alex. Seidler, National State Bank, Newark
ada
Continued from page 91
industries
process
will
come
only after atomic energy
competitive in electrical
about
becomes
nuclear
plants.
power
the
course
of
panies
expressed
year,
the
In
several
com¬
interest in
the
AEC's demonstration process heat
capacity
would be between 30 and 45,000
kilowatts,of heat.
project.
reactor
The
oxide
Uranium
in
produced
this country is sold to the Atomic
Commission.
The pre¬
price between 1962 and
will be $8 per pound.
It is
Energy
vailing
1966
likely that those mills hav¬
sufficient ore reserves will
called upon to continue oper¬
very
ing
be
after
ations
1966.
It
still
is
too
determine at what rate
production will continue and at
early to
what price.
with respect to the
future
price of uranium oxide
produced in this country after
by
1966.
A
1966,
it will be interesting
present developments
to
in
number
mental"
ready
sales
even
this
country
But
this
of
to
signifies
of
actor.
As
these
around
$5,
in the hands
indica¬
an
in either
country after 1966. Although it is
likely that the price of uranium
oxide may be lowered after 1966
as
a
result of improved milling
prices
technology, we should stress that
the mining and milling costs ac¬
count for only a moderate frac¬
tion
the
of
total
clear
fuel
prices
would
cost
cycle.
hurt
have but
a
of
the
nu¬
there
low
Reprocessing
mining
known
and
the
as
milling
feed
materials
in
last
operations
year's
still
are
of the AEC
re¬
a
because
yet enough private
chemical
build
reproces¬
sing plant of sufficient capacity.
One
important
year
was
the
development
this
creation on
June 1 of a new company. United
Nuclear Corporation, which was
formed
by the merger of NDA
(Nuclear Development Corpora¬
tion of America) with the nuclear
divisions
This
joint
and
Dec.
same
of
of
keenly interested in ensuring the
sale of this additional uranium to
nium
Great
compound
hexafluoride
(a
gaseous
natural uranium),
which
is then pumped through
contract.
The price agreed upon
thes plants in order to achieve
in a letter of intent is US $8 per
the
separation of the two iso¬
pound, which is below the price
of $10 or $11 per pound we pay topes of natural uranium. These
to Canada.
There are strong indi¬ plants are located at Paducah,
cations that the $8 price may be Kentucky, Plymouth, Ohio, and
Oak Ridge, Tennessee.
There is
lowered
during
negotiations
which are presently taking place nothing special to report this year
on any of these industrial phases
between Canada and Great Brit¬
Britain
by
means
of
a
of
of atomic energy.
ain.
The
The reactor
operation is direct¬
wish to stress
assumption that ly dependent on a number of in¬
a
price below $8 may be estab¬ dustrial steps which either pre¬
lished for an "incremental" pro¬ cede or follow the actual opera¬
here
point
is
that
we
the
duction of uranium oxide in Can¬
of the reactor. Chemical re¬
tion
Sabre-Pinon
might
approval
tion
issued
only
was
others
visualize
have
more
than
of irradiated fuels
State of New York
active
in
waste
disposal
chosen
in
State.
fuel
the
Such
shareholders
the Community of a new amount
It is
ber
likely that this time
of
coming.
I
4-0181
Bell
''
KY.
Long Distance jUniper 5-4293
System Teletype—LS
one
For
thing,
one
of up
the
the
and
U-235
for
20
a
Continued
new
on
Danville
LYONS & CO.
L.
W.
Lexington^
o
Established 1854
Oldest
Kentucky Member Firm of the New York Stock Exchange
235 SOUTH FIFTH ST.
LOUISVILLE 2, KY.
KENTUCKY MUNICIPALS
BRANCH
138
STOCKS
•
•
this
and
area
St., Lexington, Ky., Phone 2-0142
Helm Hotel, Bowling Green, Ky„ Victor 2-2545
120 N. 3rd St., Danville, Ky., 236-3636
Breckenridge Lane, St. Matthews, Ky., TWinbrook 5-9496
Direct
Private
Wires
from
Coast
to
Coast
a
has
been
part of
site
a
site
would
installation of
a
THE
be
re¬
Member
facilitv.
come
from
1st Floor,
Midwest
Stock
Bell
Teletype LS 186
Wire
Direct
Exchange
Kentucky Home Life Bldg.
LOUISVILLE 2,
Its
to
KENTUCKY
JUniper 4-0226
Dempsey-Tegeler & Co., Chicago
govern¬
13 Euro¬
Kentucky Municipal Bonds
nations.
Energy
Commission
Abroad
of
the
284
Local Securities
Euro¬
Community have been invited
Ky.—Hopkinsville, Ky.—-Columbus, Ind.
proposals" for the construction of
large-scale
nuclear power
plants
BONDS
OFFICES
Short
W.
261
Phone JUniper 4-1101
LOCAL ISSUES
•
has been
Atomic Energy Community
(Euratom) and the U. S. Atomic
Energy Commission announced in
September that private and gov¬
ernmental
organizations
within
the
page
St. Matthews
'Bowling Green
INVESTMENT
TYRUS
HECTOR
Mrs.
DAVIS
R.
W.
BOHNERT
ELINORE
CHARLES
JAMES
ARVIL
M.
L.
C.
SEDLEY
KING
FETTER
SHORT
DEPARTMENT
CLARENCE G. TAYLOR
CHARLES
J.
H.
PAT
FREDERIC
BUNK
GARTRELL
HALL
C.
PARK
GARDNER,
JR.
con¬
year
Serving Kentucky for Over 100 Years
LOUISVILLE
the
(or lease) to
year.
per
industries of
Atomic
other
under
to 30,000 kilograms of
tained
forth¬
be
proffered
re¬
to submit so-called "second round
Lexington, Ky.—Owensboro,
will
proposals
a num¬
confirmed
has
conditions
pean
Stock Exchange
ST., LOUISVILLE 2,
419 W. JEFFERSON
Local Phone—JUniper
Exchanges
The U. S. Atomic Energy Com¬
mission
northern
renrocessing
The
York and Midwest Stock
Associate Member American
in
country.
plant with World Bank assistance.
been
also
The
B. BILLIARD & SON
Member New
be
first invitation: sale
Mol, Belgium, continues.
It will
be the first internationally-owned
1872
to
It would appear
tons
pean
ESTABLISHED
have
conditions
processing plant with the eco¬
nomical capacity to handle 300
ments
,
new
in 1959, one proposal
accepted, that of the
Italian utility SENN calling for
the construction of a 150,000 kw.
processing plant.
In the meantime, work on the
Eurochemic reprocessing plant at
J. J.
to
shareholders
exploring this area of reproces¬
sing for a number of months. The
problem is, however, that in the
early years it would be difficult
to
this
will
lease
converted
Under the first Euratom invita¬
bility and know-how to handle the
chemical reprocessing phase, which
deals with hot chemistry (radio¬
active products). Davison Chem¬
and
Euratom
sub¬
United
and
logical that in time such a com¬
pany might go into chemical re¬
processing. Certainly, their com¬
bined skills give them the capa¬
ideal for the
Investment Service
the
for
merge,
of
riched uranium.
ical
The
1962 has
both
the
Eighty-Nine Years of
1,
subject to
of
companies.
Sabre - Pinon,
through
its
partnership
with
Homestake
Mining,
produces
the
very
In Louisville Since 1872
June
proposals.
the gaseous diffusion
Canada.
Last March it became plants,
known that Canada has a com¬ plants (or possibly gas centrifuge about 10% of the uranium con¬
mitment from Great Britain, dat¬ plants), fuel preparation, and nu¬ centrates purchased by the United
clear core manufacture.
We have States in this country. This new
ing back to 1957, to purchase
referred to these in previous re¬ merger would give the combined
12,000 tons of Canadian uranium
from 1963 to 1966. With the ex¬ ports and have explained the role companies a nuclear fuel capabil¬
of the
gaseous
diffusion plants. ity right from the ore, while still
tension
of
U.
S.
in
purchases
Here, the uranium oxide produced dependent on the AEC for en¬
Canada,
Canadian
miners
are
in the mills is converted into ura¬
Market.
Common
date
established
been
mission
are
countries that form the
European
cut-off
provides for fuel lease
option while acknowledging the
present AEC study of possible
private ownership of reactor fuel.
It
is specified that
if lease is
converted to sale in the U. S., the
31,
-
member countries of Euratom
the
invitation
operation no
1965. The
brought into
than
company
Furthermore,
in
year it appeared
this
of
new
and
be
to
later
capability of de¬
building
complete
cores.
October
Mathieson
Olin
of
Mallinckrodt.
Nuclear
are
in
used
detailed
economic
an
Unduly
low has the
this industry signing
impact on reactor
industrial steps which fol¬
been
not
are
that
Chemical
Josephus R. Corbus, The Illinois Company, Chicago; William Noonan, Continental National
Company, Chicago; Mr. & Mrs. P. Alden Bergquist, First National Bank of Chicago
Trust
&
reactors for any company to
small
the ultimate cost of nuclear fuel.
The
has
fuel
report,
per
as
the
al¬
and
future
Bank
have
pound from
from Canada.
certainly should not be
less,
taken at face value
tion
at
Mrs.
Mr. &
Co., New York;
that processing and the waste disposal
that goes with it take place after
"incre¬
small
Japan
place
taken
and
However,
follow
means
no
this will be the price of uranium
oxide produced in Canada after
and
93
The Commercial and Financial Chronicle
.
as-
91
94
The Commercial and \Financial Chronicle
Graham
Jones, Cooley & Co., Hartford; Blancke Noyes, Hemphill, Noyes & Co., New York; William
Claflin, III, Tucker, Anthony & R. L. Day, Boston; Wallace H. Fulton, Executive Director,
Association
of
Securities
Dealers, Washington, D. C.;
Avery
Rockefeller, Dominick &
Dominick, New York; Andrew M. Baird, A. G. Becker & Co., Incorporated, Chicago
H.
Continued from page 93
GmbH)
of Stuttgart
is
consider¬
York;
supply to foreign nations will be
made
either
directly as in the
ing
fered to U. S.
the President of the United States
International
determined
Agency in Vienna.
fuel
industry;
a deferred
which pay¬
payment plan under
ments
of
chase
would
principal for fuel
ten years
—the
the
be
with
pur¬
deferred up to
4% interest rate
a
principal would be paid in
ten
second
period
year
in
equal installments; availability of
4.5%
20 year loans from the
U.
S.
Export-Import
Bank
to
—
U.
cover
ponents
of the
with
S.-supplied plant
and services up to
com¬
capital cost of each plant,
aggregate total of $135
million.
It
appears
that
the
enriched
Belgian-
to
Of this
be
KBWP
Baden
(Kernkraftwerk
group
for
distribution
United
States
for
and
distribution
The
material
required
as
a
present
large 260,000 kw. reactor
in the French Ardennes, near the
Belgian
border.
The
German
in¬
period of years and will
be
subjected
to
prudent
safe¬
guards against unauthorized use.
over
des
a
be
uranium-235.
distributed
be
was
build
at
Presidential
amounts
the
over
in
made
are
previous
President's
determina¬
1957
and
far
so
the
A.
Wuerttenberg
Planungs-
in
sworn
of
the
as
of
the
A.
formative
there
Today,
'
'
•
.
.
.
' '
:
COMPLETE
will
years
roughly
in
one
U.
the
at
be
Gas-
year.
every
remain
of
rate
dominant
K.
installed nuclear capacity
million kw. by
1968. The
5
that 1965 will also
of
the
economic
be the
break¬
through in
Europe.
France's goal of 850,000 kw. of
'
"'v"
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t
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.}
<
>
'000.;
COVERAGE
00000
SAN
^
nuclear
power
will
achieved.
be
plants
are
by
1965
mitted
construction
under
bids
for
seeking
nuclear
w;
.
/
in
construction
the
bids for a 300,000 kw.
plant to serve the Rio de
Janeiro-Sao Paulo
lySfi
area.
The atom abroad is burgeoning.
i-
'
'
h
'
.
',"."0
■,■■■':
'■■& ¥,
Radioactiveisotopes
In
around
a
are
With
use
la
mm t'jA
LA J0LLA •
SAN DIEGO
'$0000
for
ways.
satellite
INCORPORATED
Members: New York Stock Exchange,
Pacific Coast Stock-
Exchange, American Stock Exchange (Assoc.)
PRIVATE WIRE TO BURNHAM AND COMPANY, NEW YORK
•
WIRES TO ALL OUR OFFICES
is
Outside
of
thermoelectric
SNAP
systems, the AEC is also
studying thermionic SNAP de¬
vices
and
with
a
curium-242
output
power
hundred
tures
watts.
of
for
because
of
few
a
Reactor
3,500
needed
isotopes
of
tempera¬
degrees
F
are
thermionic
the
systems
electron
emission
as
a
small-scale
for
source
has
generation
considerable
heat
electric
received
public attention this
"Isotopic power" consists in
converting the heat of radioactive
decay into electricity. The dis¬
of
covery
principle of this
back to the early
the
conversion goes
1800's. What is
radioisotopes
new
for
is the
that
use
of
purpose.
The first satellite
mission
power
earth.
by
is
in
carrying out its
means
of
nuclear
orbit
Launched
in
characteristics. So far, it has been
difficult to sustain these high
Other
SNAP
terials, preservation of foods and
processing of petroleum products.
In
solid
also
state
physics, radiation
important part
its impact on alloys,
will
play
an
try and is becoming
sable
tool
in
a
tween science
and
indispen¬
an
relation
new
be¬
industry.
Conclusions
conviction that the cost of one
million BTUs of coal, oil and nat¬
ural
gas energy will continue to
everywhere because of infla¬
rise
tionary
pressures
in
the
Free
World. Through increases in ther¬
mal
efficiency
ventional
and
size
of
con¬
plants,
utilities
have
paring down the cost
electrical
kilowatthour.
succeeded in
of
the
The
a
around
June
using
nu¬
joint AEC-NASA effort.
The
ROVER
nuclear
rocket
is
being pushed vigor¬
ously. Such a rocket will not be
fully developed until 1966-1967.
program
In
time
rocket
the
nuclear
will
propelled
-
heavier
carry
pay-
loads much farther than chemical
rockets.
The
technology is quite
new
and
much
developmental
work is being carried out.
The
field
of
radiation
applica¬
tions using decaying radioisotopes
or particle accelerators is
growing
Radiation
brings about sub¬
stantial changes in
wide variety
of products, often improving their
a
qualities or bringing about new
properties and new products. Ir¬
radiation
are
machines
and
services
supplied by several com¬
In line with AEC policy
now
the
by the
make room for private indus¬
try wherever the latter is ready
to take over any of the industrial
phases of atomic energy, during
the year the AEC announced that
the
routine
tribution
ended.
production
of
cobalt-60
test
reactors
been
are
will
-
now
tend
The
AEC
terial
for
ordinary
will
still
demands.
provide
ma¬
in
100,000
ionizing
quantities greater than
curies to those who use
radiation
processing tool.
as
a
major
standardization
reduce
capital costs.
already been achieved
this direction. Many
improve¬
ments in the nuclear fuel
cycle,
to which we have
referred, will
in
further
contribute to the
tion of nuclear fuel cost.
It
is encouraging to
developments in Great
the
European Common
and
Japan parallel and
ment
our
own
cross-over
is
reduc¬
that
see
Britain,
Market
supple¬
experience.
The
point between costs of
conventional
and
nuclear
power
likely to be reached in
high fuel cost areas of
very
1965 in the
the United States
and
Europe.
Meanwhile, radioactive isotopes
find an ever
increasing usefulness
in
industry. Radiation
from the
laboratory to
lutionary
try.
In
applications
the
nology,
it
field
of
becomes
is
moving
new
in
revo¬
indus¬
space
tech¬
increasingly
clear that atomic
energy will
the
play
leading role.
Respectfully submitted,
NUCLEAR INDUSTRY
COMMITTEE
Paul F.
The
Genachte, Chairman
Chase
New
producing sufficient quantities of
cobalt-60
to
Much has
dis¬
and
had
Westinghouse and General
Electric
the
their
systems
clear reactors for power up to 30
or 60 kw are
being developed in
the to
program,
year.
HILL RICHARDS & CO.
of
the globe.
panies.
radioisotopes
power
*
of
our
of
-
;,V
firms
radioisotopes
use
variety of purposes. Suf¬
it to say that radioisotopes
put to
beneficial
uses
in
hundreds
m
industrial
1,900
to
are
wide
fice
<
achievement
fast.
the United States, there
licensed
LONG BEA
watts
symbolic of
the marriage between Space and
the
Atom.
Only nuclear power
can
supply the propulsion and
power
300,000 kw. nuclear plant
Bombay, India. Brazil is
a
near
%
This
probably
Nuclear
Italy, Germany and Japan. Seven
U. S. and foreign firms have sub¬
of
\
2.7
cold
trend is likely to change in
future, mainly because it will
U. K. Atomic Energy Authority
be extremely difficult to increase
temperatures for any length of
the efficiency much further. On
agrees
with
Euratom
that
the time because of the
limitations of
cost of nuclear power in many
the other hand, the cost of nu¬
present structural materials.
clear energy can only come down
areas,
including the U. K., will
Beyond a few kilowatts, elec¬ in
have fallen below the cost of con¬
spite of inflationary pressures.
trical power needs can only be
ventional power by 1970. It ap¬
The construction of large size re¬
satisfied
by a nuclear reactor. actors
and
an
pears
'<000:
into
of plastics,
are
reactors
the
year
CALIFORNIA
tonium-238
upgrading
eight similar lites will give accurate
Your Committee would like to
naviga¬
reactors in operation in the U. K., tional
information anywhere on conclude by expressing its firm
of
'
in¬
vulcanization of rubber, steriliza¬
tion of surgical and hospital ma¬
the
"Special Nuclear Auxiliary
17, 1961 was the fifth Power" or "SNAP"
program. The
anniversary of the official open¬ United States
expects to have an
ing of the first reactor of the operational TRANSIT
system in
Calder Hall plant in the U. K.
service by late 1962. Four satel¬
planning. As the
capacity
of
individual
stations
will increase, the U. K.
should
l$$ffices for
applications
heat
years.
at Chapel Cross with a total ca¬
pacity in excess of 200,000 kw.
Orders for new plants in future
riched uranium is concerned. The
radiation
clude
October
The
en¬
The
an
last September. He
because of
Sterling
Cole
of
the power needs of satellites, space semi-conductors and polymers.
States,
who
led
the platforms and stations on planets.
An almost pure research field
Agency under sometimes trying
The
transmitter
generator in until the present time, radiation
conditions
during its first four TRANSIT is one of the
units of is now being introduced in indus¬
total.
of
carries
United
four at Calder Hall itself and four
supply
TRANSIT
battery that converts the
energy
of decay of plu-
succeeds
have
I
Eklund
the
should
Navy,
atomic
steady power for the transmitter.
Director-General
E.
cooled
-
the
Energy
Sigvard
was
second
I.
Atomic
Arne
Sweden
through
or
40%
announcement
as
Dr.
Euratom
about
allay the fears of foreign nations
in
of
case
made
uses
will
countries.
last
to
be
of
total of 165,000 kilo¬
kilograms
tion
decided
abroad
a
the
The
has
to
peaceful
available
other
will
amount
total, 100,000 kilograms is
within
65,000
September,
the
of contained
grams
French
SENA
group
(Societe
d'Energie Nucleaire Franco-Beige
Ardennes)
for
and
home
creased
to
that
uranium
available
40%' to
an
150,000 kw. reactor plant.
a
In the latter part of
Thursday, December 28, 1961
Early F. Mitchell, First National Bank, Memphis
supply
at prices comparable to those of¬
enriched
of
.
Edmund C. Byrne, Phelps, Fenn <&
Co., New York; Edwin A. Stephenson, Paribas Corporation, New
York; Donald C. Patterson, Chemical Bank New York Trust Company, New York; William D.
Byrne,
Phelps, Fenn & Co., New York; David H. Callaway, First of Michigan Corporation, New
National
surance
.
.
Manhattan Bank
York, N. Y.
Franklin B. Schmick
H. M.
Byllesby & Co., Inc.
Chicago, 111.
Wheelock
J.
Whitney, Jr.
M. Dain & Co., Inc.
Minneapolis, Minn.
Volume 194
Mr.
W.
David
Mrs.
&
Number 6120
Hunter,
.
.
The Commercial and Financial Chronicle
.
McKelvy & Company, Pittsburgh; Gerald Wyatt, A. E. Masten
Arthur Tresch, A. E. Masten & Company, Pittsburgh
95
Mr. &
&
Mrs. Julian K.
Company, Pittsburgh;
plane sales abroad.
Canadian
Foreign man¬
ufacturers of light aircraft have
begun to look with interest upon
the
the United States market and, al¬
on order, British and
equipment and one of
trunk lines recently placed
service,
or
for
orders
a
British jet.
ice
airlines
is
serv¬
shown
also
have
though their penetration to
short-range
new,
Two of the local
minor, they
increase their efforts to
in¬
share
terest in this jet.
this
of
date
be expected to
can
and
secure
other
a
export
markets.
Decline
Earnings
Plane
for
Smaller
The sales
Companies
Two of the three
principal small
General
includes all civilian
only
a
and
earnings decline
to represent
temporary interruption of
appears
growth trend which the in¬
dustry has been experiencing for
some years.
The Federal Aviation
Agency has estimated that the
number of aircraft in the general
sales, and all three reported lower
earnings, for the nine months
30.
year
the
plane manufacturers in the field
of general aviation reported lower
ended June
this
aviation
aviation
flying except
that of the scheduled airlines and
increase
will
fleet
Profit Margins in the Aerospace
Industry
conditions
Perhaps
existing throughout the
during the latter part of
1960 and early 1961.
A drop in
their volume of military business
also
occurred this year, further
affecting sales. Unusually high in¬
problem
major
the
plague the
economy
which has continued to
ventories
industry is the constant
its profit margins on
defense
business, which consti¬
tutes by far the largest portion of
the industry's volume. One of the
reasons for the narrowing margins
is the increased competition with¬
in the industry, which today in¬
cludes
a
substantial number of
carried
year, plus costs
introduction of
over
from
involved
last
in the
models
new
aerospace
pressure
this
have affected margins and
although sales volume picked up
toward the latter part of the year,
earnings for fiscal 1961 will be
below those of 1960. Export sales,
year,
shown
on
with
such
that
substantial increases
represents
trants
industry. The Export-Import bank
considerable sup¬
port to the financing of light air¬
for the defense of the nation and
for
the
myriad, costly projects
into which the "space race" has
led us. It should be obvious to all,
however, that the steady erosion
of
this
vital
industry's profit-
Emphasis
statements
Recent
over
by
govern¬
the
There
have
belief,
use
ferred to
above is precisely what
responsible members of the in¬
dustry have been urging for some
time and that, if properly designed
and administered, they will be
welcomed by the industry as a
means
by which it may realize
profits which are more commen¬
surate with the risks undertaken.
greater reliance is to
be placed upon incentive contracts
rather
than the
cost-plus type
have
been
used
with
in¬
creasing frequency in recent years.
It is proposed that from now on
incentive
contracts
will
hoped that the renego¬
procedures
will
also
more
enlightened
ad¬
ministration
retention
so
of
as
to
ensure
higher
any
the
profits
which may be received in reward
for
superior performance.
Generally
indica¬
been
that
which
our
of
incentive contracts of the type re¬
receive
quality of work
and speed of delivery relating to
various items of defense equip¬
tions
It is
however, that the greater
tiation
Incentive Contracts
on
ment officials have expressed con¬
ment.
and space effort.
pears
to be
speaking,
a
re-evaluation
there
need for
of
the
a
ap¬
complete
attitude
of
government toward the industry.
A prominent industry member has
recently stated that in view of
the
continuing demands for heavy
contain
Continued
on
page
97
increased
competition
of qualified en¬
the
field,
it is a
that
into
gins on defense business are being
squeezed by other and, in many
MEMBERS NEW YORK
STOCK
American Stock Exchange (Assoc.)
UNDERWRITERS AND
since 1887
IB®
contributing to
EXCHANGE
Pacific Coast Stock Exchange
\
9
'
and
the best, out of every dollar spent
is engaged, that mediocrity
our defense
It is to be
worth.
cern
S.
activities.
aerospace
Lester, Ryons & Co.
■'
desire to get the most,
government
of
U.
cannot be tolerated in
healthy development from the na¬
tion's standpoint. However, mar¬
has been giving
•
basic
that
profits are somehow, of them¬
selves, wrongful. The inescapable
fact remains, however, that the
profit incentive is a cornerstone
of our system of free enterprise,
a system which has, even in other
perilous times, proven its basic
areas
many
whereby good perform¬
ance will be rewarded and poor
results will be penalized.
It is obvious, in view of the life
or
death struggle in which the
Generally speaking, to the extent
this year, however, and continue
to represent a strong factor in the
■:
development contracts and
small production runs. Insistence
by the government that the in¬
dustry finance an ever increasing
portion of vital research and de¬
velopment work, disallowance of
interest charges and other legiti¬
mate costs of doing business, con¬
fiscatory use of the renegotiation
process; these are but a few of the
methods employed to whittle aw!ay
at the underpinning of the indus¬
try, its earning power.
features
companies not heretofore identi¬
fied
particularly in European markets,
have
and
As taxpayers, none of us can
quarrel with
the
government's
than 35% by 1970.
more
forces than
by
the
large non-scheduled carriers.
These declines were primarily due
to the effects of the recessionary
more
those of free competition. In gen¬
eral such forces reflect the need
Securities Committee
Continued from page 67
rigorous
making ability, particularly in the
face of the greatly increased risks
inherent in the complexity and
for an updating of the procure¬ magnitude of the projects it is
ment practices and policies of the asked to undertake, may in the
contracting
authorities,
policies long run result in the frustration
which are to a considerable ex¬ of this country's efforts to forge
tent still geared to the days of maximum protection against the
long production runs in spite of powerful forces which are arrayed
the fact that today the emphasis against it. There appears to be a
is increasingly on large research growing attitude of suspicion in
ways,
Report of IBA Aviation
Roosevelt, Dick £ Merle-Smith, New York; Mr. & Mrs. Tcby Morgan,
York
-t
Manufacturers Hanover Trust Company, New
"
WESTERN
PROGRESS
■
DISTRIBUTORS OF
INVESTMENT SECURITIES
through public offerings and
private placements of securities
o
16 OFFICES FOR THE
MOST COMPLETE RETAIL COVERAGE OF
SOUTHERN CALIFORNIA
William R. Staats & Co.
investment securities
established 1887
•
623
So.
Hope
Street,
Los
Angeles
Corner Wilshire and
CORONA DEL MAR
LONG BEACH
RIVERSIDE
OCEANSIDE
SAN DIEGO
California
ENCINO
PASADENA
SANTA ANA
GLENDALE
LOS ANGELES 14, CALIFORNIA
MEMBERS: New York Stock Exchange, American Stock Exchange
Telephone MA 5-7111
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CLAREMONT
17,
Hope
640 SOUTH SPRING STREET,
HOLLYWOOD
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(Assoc.)
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CALIFORNIA!
SAN JOSE.
LOS
ANGELES,
ORANGE,
SAN
VAN NUYS,
ARIZONA!
PHOENIX,
FRANCISCO,
GLENDALE,
WHITTIER
SCOTTSDALE
PASADENA,
PALO ALTO,
BEVERLY HILLS,
SANTA CRUZ
SAN
DIEGO,
96
Mr-
Mrs.
&
The Commercial and Financial Chronicle
Robert
Hannaford
Wheelock
Mr.
&
A
Whitney,
Mrs.
A. Jameson, Pohl A Co., Cincinnati, Ohio;
Mr. & Mrs. Warren D. Williams,
Talbot, San Francisco; Harry C. O'Brien, W. E. Hutton A Co., Cincinnati
Jr.,
John
S.
J. M. Dain
A
Co., Inc.,
Minneapolis;
Hilson, Wertheim A Co., New York
George B. Fisher, Bosworth, Sullivan and
Michigan Corporation, Detroit; Russell
Mr.
&
Mrs.
Leon
Charles
Lees,
Ira Haupt
A
Arnold
Massey, Mills, Spence A Co., Ltd., Toronto;
Keystone Custodian Funds, Boston
Company, Denver^ Mr. &
& Mrs.
Mrs. Henry Earle,
E. Siefert, Stern Brothers A Co., Kansas City,
Co., New York
Charles
First
Mrs.
of
Mo.
S. L.
John
Sholley,
Charles
Co.,
Mr.
W.
.
.
Thursday, December 28, 1961
Co., Inc., New York; Mr. & Mrs. Frederic C. Beil, Jr., Beil
Fla.; Gerald L. Hurley, Barr Brothers A Co., New York
&
Corbus, The Illinois Company, Chicago; William
Caldwell, First Boston Corporation, New York
Agnew, The First National Bank of Boston; Mr.
Clayton Securities Corporation, Boston
H.
John
A
Mrs. J. R.
R.
R. Treuhold, Paribus
Corporation, New York; James
Lemon, Johnson, Lemon A Co., Washington, D. C.;
Jay Emerson'Thors, Asiel & Co., New York
R. Polk, Jr., Provident Tradesmen's Bank,
Philadelphia; Newbold Strong, De Haven &
Townsend, Cr outer A Bodine, Philadelphia; Philip P. Gaughan, De Haven A Towns
end, Cr outer A
Bodine, Philadelphia; Henry E. Crouter, De Haven A Townsend, Crouter A Bodine,
Philadelphia
J. Yunker, A. M. Kidder A
Hough, Inc., St. Petersburg^,
Roswell
.
Wasserman,
Asiel
&
&
Co., New York,
Mrs.
Calvin
watching
Clayton,
Tennis
Match
N. Fisher, Singer, Deane A Scribner, Pittsburgh; Franklin L.
Schroeder, Braun, Bosworth A
Toledo; Carr Payne, Cumberland Securities Corporation, Nashville; W. Bruce McConnel, Jr.
Singer, Deane A Scribner, Pittsburgh
Volume
194
Number 6120
had
Continued from page 95
in
investment
equipment
cated
and
new
and
been extended to 47 airports
throughout the
sophisti¬
country
the
and
total is expected to
grow to well
over 100 in about five
years.
facilities,
"very large companies, or groups
companies, and a narrowing of
competition may be an unavoid¬
able part of maintaining a strong
aerospace industry."
The finan¬
traveler
cial attrition in the industry
miration for the results which the
The accomplishments of the in¬
of
as
dustry
we
a
certain
industry
spite
development of
in
afmiration if it is to be successful
in
completing its transition to the
jet age and in preparing itself for
the
giant step
into
supersonic
there has been no evidence
of any consistency of government
travel which may be expected to
take place some time in the 1970s.
For it is
abundantly clear to
with respect to possible
within the industry de¬
signed to alleviate the situation.
policy
mergers
any¬
one
reasonably familiar with the
basic
TRANSPORT
airline
industry
cial
United
States
is
currently
completing the initial phases of a
revolutionary program which in¬
volves
replacement of substan¬
"Profitless Growth"
scriptive
trunk
1960
but
is
estimated
It
only
May
six
terminals.
major
of this
1
available to
was
year
a
industry
is
expected
considerable
loss
for
to
the
of favorable
sults
the
11
five
were
domestic trunk
lines, only
profitable
eight months
able to report
operations
for
the
and
By
only two showed an improve¬
ment
in
earnings this year as
such service
airline
rising
out
pected
operating
conditions,
economies
of
re¬
generally
of
healthier business
jet
ex¬
opera¬
tions, etc., began to sag noticeably
after
mid-year as the airlines'
operating results become clearer
and, with few exceptions, these
shares have continued to perform
rather poorly.
There
are
number
a
for
reasons
operating
the
of
specific
unsatisfactory
results
the
trunk
of the
econ¬
of
lines in 1961.
(1)
In
many
there
omy
areas
somewhat slower
was a
than
expected recovery from the
recessionary conditions which pre¬
vailed last year,
ing
the
particularly dur¬
latter
Furthermore,
months
thereof.
spending
has not shown the resurgence this
year which had been expected in
line with
a
generally healthier
economy.
Unlike the experience
of previous
years, when airline
traffic has usually been quick to
reflect improving economic condi¬
tions, industry traffic trends in
1961 have been quite disappoint¬
ing. Total revenue passenger miles
of
the
first
consumer
domestic
nine
9./10ths
trunks
months
of
1%
of
for
1961
lower than
first nine months of 1960.
to
further
been
made
pected
Investment Securities
:
■
■ ■
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y.
:'My.
629 South
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vx'• :X
yx
Los Angeles 14
MAdison 7-0281
Van Nuys
Long Beach
heavy
serviced if the lines
are
trunks
present" program
and
troduction
amounts
of
industry
financed
has
the
supersonic
tensive
lease
prepare
In
addi¬
obligations in
con¬
flight
equipment and to support ex¬
panded and modernized airport
and maintenance facilities.
it
is
true
rently
that
of
in
its
While
depreciation
new
on
and
Continued
on
page
were
in
the
Investment Securities
For the
to
show
rate,
a
normal
more
revenue
453
passenger
SOUTH
SPRING
STREET, LOS ANGELES
REDONDO BEACH
MEMBER
PASADENA
PACIFIC
COAST
13
LONG BEAcH
STOCK
the
Operating
continued
the
EXCHANGE
including
costs,
break-in
costs
of
jet equipment, have risen
in 1961. Interest charges and de¬
preciation accruals have likewise
been higher this year.
(4) There has been a continua¬
new
tion
of
broader
the
use
strong
DISTRIBUTORS
toward
trend
of coach travel
versus
of
first class.
The relatively brief
flight time of the average jet trip,
INVESTMENT
•
compared with 48.6% last
First class travel declined
'
'
SECURITIES
0>
_
as
year.
Bingii.im .Walter s Hurry. Inc.
16.5%
during the nineperiod.
(5) There is presently a considable degree of excess capacity in
month
line
trunk
industry
and
situation has continued to
jet
new
equipment
is
Member
Exchange
7-1041
worsen
;
intro¬
rapid increase in ca¬
pacity, together with traffic de¬
clines
experienced
throughout
most of 1961, has been reflected
this year in further decreases in
passenger load factors (the per¬
centage of available seats actu¬
ally sold in scheduled service).
(6)
Stock
Coast
S. SPRING—LOS ANGELES—MAdison
629
the
Pacific
! ?'
■
TELETYPE
'
*•
LA
'
224
.
"■'*
•
The
Load
have
factors
continuous
shown
Pasadena:
Panorama
70
S.
Euclid Ave.—SYcamore
3-4196
City: 14530 Roscoe Blvd.—EMpire 4-5795
almost
monthly
decreases
since the introduction of the jets
in late
in Southern California-check these facilities
1959.
Average load factor
line industry was
57.2% for the nine months ended
for
the
trunk
Sept. 30,
60.4%
■
Dealers in Southern
■
Fast executions
California Securities
in
the
as compared with
comparable period
HARBISON & HENDERSON
Members Pacific Coast Stock Exchange
Established 1923
last year.
Too
on
1961,
Pacific Coast Stock Exchange
Much
Competition
While certain of the
UNDERWRITERS
reasons
•
DISTRIBUTORS
•
DEALERS
set
forth above for the airlines' rela¬
■
Underwriters and Dealers in Corporate
and
tively poor performance in 1961
are obviously beyond the control
Municipal Securities
of either the
direct
private
wires
New York and Chicago
to:
Dominick)
New York (Dominick &
(Doyle, O'Connor & Co. Inc.)
industry or the vari¬
regulatory authorities, most
of the industry's current and past
ous
problems are clearly a reflection
of the inescapable fact there is an
excess
of competition within the
San Francisco (J. S. Strauss & Co.)
industry.
STERN/FRANK. MEYER <22> FOX
v.
(Established 1932)
There
is
too
parallel service in most of the in¬
dustry's
principal
markets,
far
than is necessary to satisfy
Exchange
the basic tests of convenience and
(Assoc.), Pacific Coast Stock Exchange
necessity.
BLDG., LOS ANGELES 14,
MA 2-2123
-
TWX
-
LA 271
and
COAST SECURITIES
Direct Private Wire to A. G. Becker & Co.
more
member: New York Stock
BANK
RETAIL DISTRIBUTION
much
American Stock Exchange
UNION
Specializing in
PACIFIC
As a result of the fierce
in
the
of
necessity, endeavor to put itself in
the best competitive position by
forces prevalent
industry each line must,
competitive
210 W. 7th STREET
TELEPHONE
LOS ANGELES 14, CALIF.
MAdison 7-2571
TWX
LA 658
cur¬
to
Co.
&
and
the vast
equipment
operation
Eichler
,
the
to
era.
nection with the purchase of
ports by perhaps the mid-1970s.
The
to main¬
tion to such interest charges most;
of the airlines have incurred ex¬
trans¬
supersonic
debt;
tain the necessary credit standing
to enable them to complete their
next
amortization accruals
.
Covina
This
flown
(3)
as
Pasadena
Laguna Beach
1955.
outlays ip connection with the in¬
duced into service.
Corona del Mar
31,
of 1961.
the
Spring Street
Dec.
structure has resulted in increased1,
interest charges which must be
it has been esti¬
domestic
certificated
the
of
Dec.
for
about
Established in 1932
• •
the
the
at
approximately $1.3
billion for additional equipment
plus $600-$700 million to meet
payments on aircraft now in oper¬
ation. While the carriers may be
expected to have a respite from
additional major capital expendi¬
tures during the latter half of the
1960s, they must prepare for large
by
the
domestic
trunklines were only one-half of
1% higher than during the corre¬
sponding period last year.
(2) The industry suffered from
costly strikes in the early months
total
<S* Co.
In
1961.
ratio
31, 1960 was ap¬
proximately 1.6 to 1 as compared
with an average ratio of 0.4 to 1 at
require
lines during the first nine months
of 1961 represented 57% of the
Crowell, Weedon
in
that
mated
will
minimizes passenger dis¬
comfort, has increased coach us¬
age.
Coach travel on the trunk
Pacific Coast Stock Exchange
heavy
four to five years
equity
carriers
through 1960
outlays have
billion
$3
over
and
which
Members:
jet equipment program to a large
extent through
the medium of
borrowed funds. Average debt to
purchasing
the
most
advanced
flight equipment and by constant
improvement of its ground facili¬
ties for servicing
flight equip¬
ment, handling its passengers, etc.
Capital expenditures by the in¬
dustry, both for flight equipment
and ground facilities, in connec¬
tion with its jet program amounted
third quarter, which had been ex¬
growth
increased
by
resulting in net
losses for the industry of $12,410,000 for the eight months pe¬
riod of this year, compared with
profits of over $10.4 million in the
comparable period last year. Of
that
jet service
ago
in
able
penses,
however,
about $57 million
additional
by jet is expanding
throughout
the
United
Approximately two years
States.
were
Operating
revenues
for
the
eight months ended Aug. 31, 1961
were
$1.48
billion, up slightly
from $1.44 billion for the same
period
in
1960.
Operating
ex¬
service
rapidly
they
against 1960. Trunk line common
prices, which climbed ap¬
preciably during the first five
months of the year in expectation
stock
miles
by the end of
1962 virtually all long and me¬
dium flights will be jet powered.
Air
which
year.
sev¬
jets plus about 40 turboprops.
the
show
the beginning of
1961, U. S. certified airlines had
in service
224 turbojet aircraft,
about
115
large
together with
turboprop planes. By the end of
the year the lines will have re¬
100
from
The
approxi¬
revenues
should be somewhat ahead of 1960
At
than
industry.
generated
$2 billion of
bring down to net income only
$1.1 million. Revenues in
1961
plished, particularly in the latter
area, the industry has truly made
more
expression "prof¬
the
to
accom¬
tremendous strides in the last
of
lines
mately
ground'facilities.
While much remains to be
oft-used
itless growth" continues to be de¬
purchases
of
new
flight equipment, the industry has
been engaged in a massive pro¬
gram for the expansion and mod¬
ceived
transport
of
pages
The
large-scale
years.
air
challenging problems.
tially all of its piston
engine
equipment with turbine powered
aircraft.
In conjunction with the
eral
of
his morning news¬
paper, that the airlines face many
in
the
ernization of its
statistics
and, in fact, to almost anyone who
occasionally glances at the finan¬
Domestic Trunklines:
trunk
even
in
inconveniences
Unfortunately how¬
industry needs more than
the
ever
ever,
The
achieved,
minor
experience.
the
port give further credence to this
trend of thought.
So far, how¬
AIR
has
of
nothing but ad¬
which he may from time to time
supersonic trans¬
a
have
can
jet transport program
and the
huge sums which will be at risk,
even
after allowing for possible
assistance,
indeed remarkable and
that today's air
are
are
result of the rigors of the current
governmental
97
The Commercial and Financial Chronicle
...
be
99
98
The Commercial and Financial Chronicle
%
Mr.
&
Mrs.
Stephen C. Reynolds, Jr., Hemphill, Noyes & Co.,
Ycrk; Chuck Rendigs, Bache & Co., New Ycrk
New
Mr. & Mrs.
James^Klingel, Juran A Moody, Inc., St.
Bergman,
Mr.
&
Mrs
Allison-Williams
Company,
Taylor B. Almon, Almon A
Paul; Oscar M.
Minneapolis
McKinney, Inc., Dallas
Mr.
S.
&
Mrs.
Grey
Stacey
R.
Theodore
Rodolph
Dayton, Jr.,
Casgrain,
Elkins,
Casgrain <& Co., Ltd., Montreal;
Morris, Stokes & Co., Philadelphia
Henderson, T. C. Henderson A Co., Des Moines, Iowa;
Henderson, T. C. Henderson A Co., Des Moines, Iowa
CALIFORNIA
Carl
.
Thursday, December 28, 1961
McGlone, Chapman, Howe A
Spencer
W. C. Pitfield & Co., New York
Mr.
MUNICIPAL
&
Mrs.
Eugene
L.
Trash
De
A
Co., Chicago; Brittin
Co., New York
Staebler,
Eldredge
BONDS
INVESTMENT
I
.
William H. Sword, Morgan Stanley A Co., New York; Mr. & Mrs.
Kirkwood B. Cunningham, Cunningham, Schmertz A Co., Pittsburgh
C.
Mr. & Mrs. Archie F. MacAllaster,
.
DEPARTMENT
MONTGOMERY STREET
SAN
FRANCISCO 20
ASSETS OVER $2,000,000,000
CAPITAL
FUNDS
OVER
$140,000,000
A
Co.,
C.
Eustis,
New
York
Volume 194
Number 6120
.
.
,
The Commercial and Financial Chronicle
99
II ill ik
-m
ilifl
I sir
-m
>
wlr,
,
<
.
S&f
f
$ «r;
■
'
«
W
5j>
"
'
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J"
^J
•
Mil
&
r
Musson, Newburger, Loeb A Co., New York; Ladd Dinkins, Ladd Dinkins & Co., New Orleans;
Walter D. Kingston, Jr., E. F. Hutton & Company, New
Orleans; Lee F. Murphy,
Ladd Dinkins & Company, New Orleans
James
the domestic trunk line industry
is
approximately 10.5% of in¬
be expected to pro¬
vested capital, based upon a some¬
vide
large amounts of cash to
what lower return for the four
meet interest,
rentals and debt
amortization schedules, it is ob¬ largest carriers and a somewhat
vious that such cash throw-offs higher return for the remaining
Continued
acquired
do
from page 97
may
necessarily
not
occur
amortization
and
depreciation
unless
charges are earned.
that
clear
is
It
the
industry
a reasonable level of
if ever airline equities
are to be capable of attracting and
holding investors.
The relative
maintaining
earnings
stocks has
cipal
have
There
have
most
of
been
reasons
resorted
airlines
the
debt
been
airline
of the prin¬
one
why
to
financing.
comparatively
few
periods in recent years when
airline
stocks
have
sold much
one
or
two
trunk lines
which
of
the
ten
a
position) were
their book values.
and
it
will meet
United Air Lines, one
showing profits this year,
cently estimated that it will
only 2%
re¬
earn
of its investment in all
of 1961.
The
industry has been seeking
methods by which the level of
airline
earnings might be im¬
proved. In an effort to generate
new
the
traffic, and at the urging of
CAB, a number of the lines
earlier this year introduced vari¬
ous
kinds of promotional fares,
lines.> Other innovations this year
balance
deficit
sheet
1960
none
domestic
a
(excluding Northeast,
shows
1961.
in
airline
but
shares of all
date the
standard
virtually certain
No
including
the much
publicized
"youth fare" which has since been
abandoned by all of the trunk
As of
above their book values.
recent
is
carriers.
of the few carriers that have been
assured of attaining and
unattractiveness
line
met this
it in
Airline Fares
must be
trunk
selling below
In
November, 1960, after a fouryear investigation of domestic air¬
line
passenger
fares, the Civil
Aeronautics Board concluded that
a fair over-all rate of return for
include
so-called
"air
bus"
and
shuttle service designed to attract
more travel business from private
automobiles, railroads and busses.
One line recently announced plans
to offer special, economy jet serv¬
ice
at prices about
25% lower
than present jet coach fares. There
is
a
considerable
difference
of
I
L. Nongard, Nongard, Showers & Murray, Chicago; Arnold J. Kocurek, Rauscher, Pierce A
Co., Inc., San Antonio; Frank C. Carr, John Nuveen A Co., Chicago; E. William Darmstatter,
Stifel, Nicolaus A Company Incorporated, St. Louis
might otherwise
have gone
via first class or regular coach
flights at higher fares.
It now appears that some selec¬
tive upward adjustments in air¬
line fares may be forthcoming, al¬
though the nature and timing of
increases
such
any
.....
in
crease
fares
filed
have
for
and
& DISTRIBUTORS
is
lines
as
to the wisdom of fare in¬
at
creases
this
Certain
time.
the carriers have felt that
fare increase
much
might drive
business
that
it
a
of
new
competing
against
stronger lines; (c) the encourage¬
ment of new rate plans designed
to tap new sources of traffic; (d)
the development of a sound plan
by which all first class mail would
be carried
by air.
Many of the suggestions made
by Project Horizon have been
urged before but with little con¬
sequence.
There are signs how¬
ever
that the regulatory authori¬
ties, who
are charged by Act of
Congress with the grave respon¬
sibility
of
maintaining
M
Wm
Earlier
ing bureau,
is
which
a
to
primary purpose of
enable
the
Board to
anticipate and possibly head off
problems which arise in the in¬
dustry rather than merely at¬
tempting to correct them after
they have become chronic.
The
recent
action
of
the
CAB
the conclusion of its twoyear-old "non-priority mail rate
upon
case"
sign.
is likewise an encouraging
Its decision in this case laid
Continued on page 101
away so
Underwriters, Distributors,
Primary Trading Markets...
appointing results, to date, of the
promotional fare program, coupled
what appears to be a cau¬
tious willingness on the part of the
with
CAB to at least discuss the ques¬
tion
CORPORATE,
MUNICIPAL AND
UNLISTED SECURITIES
of fare increases, may
bring
the industry closer together in its
thinking on this subject.
CAB
The
has
concentrate
urged
that
their
efforts
the
to
J. BABTH & CO.
ESTABLISHED 1883
American Stock
Exchange (Associate)
of
penalties designed to re¬
problem of "no-show"
passengers. A long range cost re¬
duction program suggested by the
CAB is the joint use of ticketing
facilities, airport equipment and
SAN FRANCISCO
•
LOS ANGELES
the
NEW YORK
MENLO PARK
•
SAN JOSE
Private Wire Connections between all Offices
(
•
•
•
OAKLAND
•
SAN DIEGO
Direct Leased Wires tot
Baker, Weeks & Co., New York
John R. Lewis, Inc., Seattle
•
•
Scherck, Richter Co., St. Louis
George Patten Investment Co., Portland, Ore.
Refsnes, Ely, Beck & Co., Phoenix, Arizona
This Commit¬
the desirability of
such "belt-tightening" procedures.
It believes, however, that in view
of the severely depressed level of
the industry's earnings, time is of
the essence and, therefore, more
tee recognizes
available in the cities
by our 47 offices. Contacts with
partners and 450 Account
industry, may be
enlightened atti¬
a more
this year the CAB
for the first time set up a plan¬
sound
a
healthy
adopting
wouldn't
by our
Advisors
help assure the successful sale of new
drastic
offerings and private placements.
The
Committee
feels that favorable consideration
tude.
are
help earnings. The generally dis¬
duce
distribution
individual and institutional buyers
57
carriers
increases
maintenance bases.
securities
others
and
pertain¬
ing primarily to coach fares. Here
again, however, there is far from
unanimity of opinion among the
tion
BROKERS • DEALERS
of
two
involving excessive com¬
petition except where it is clearly
free coach meals and the institu¬
UNDERWRITERS
covered
presently
uations
cut expenses through such imme¬
diate steps as the elimination of
Hi
A substantial market for the
is
uncertain. One of the large trunklines has filed for a general in¬
lines
ii il
Richard
opinion within the industry, how¬
ever, as to whether or not such
developments are attracting new
traffic or in the long run will
prove to have been mainly diver¬
sionary by enticing passengers
who
%
are
and
immediate
measures
necessary.
should be
CAB
for
to
promptly given by the
requests by the industry
some
reasonable form
of
se¬
Bell System
lective fare relief.
Teletype: SF 202
Regulatory Climate
The extent to which the
regula¬
have been con¬
cerned with the industry's prob¬
lems is indicated by the fact that
the airlines have been the subject
of some 75 governmental studies
over the past ten years. The latest
of these, Project Horizon, recog¬
nizing the seriousness and urgency
of the situation, has recommended
a
number of approaches to the
problem. Included in such recom¬
mendations are (a) the refusal of
tory
the
authorities
CAB to certificate new com¬
petition except wheer it is clearly
justified on economic grounds: (b)
a
more
sympathetic approach to
mergers that would alleviate sit¬
I
Telephone
EXbrook 2-7112
ONE
MONTGOMERY
STREET
SAN FRANCISCO 4
LAWSON, LEVY, WILLIAMS
Members:
New York Stock
Exchange
&
STERN
Pacific Coast Stock Exchange
The Commercial and Financial
100
Chronicle
.
.
.
Thursday, December 28, 1961
V,M
.mam
mm
i
*
.
M/T
Mr.
&
Mrs.
Harley
tv
v
j
:
L. Rankin, Goldman, Sachs A Co., Philadelphia; Pat Morris,
Company, Chicago; Mrs. Graham Jones, Hartford, Conn.
W. Carroll, Lee W. Carroll A Co., Newark, N. J.; Norman E.
Wright, Jr., The Northern Trust Company, Chicago; Clayton F.
Brown, The Northern Trust Company, Chicago
Lee
Northern
Robert F. Hague, Faulkner, Dawkins A Sullivan, New York; Charles
F. Morgan, Morgan Stanley A Co., New York; Robert H. Smith,
Faulkner, Dawkins & Sullivan, New York
^ndfrewf S. gpapbipn, L. G. Beaubien A Co- Limited, hfontrpal; Mr. & M rs, Garrett H- Taylor, Wood,
Cfindy $ go., fpp.; Npyf Yoyk; Mr- # |j|rs. Frfmoqt Wr Rqosqo, AfcLeoff, Young, Weir, Inc., New York
Mr.
&
Fred Stone, Marine Trust Company of Western
York, New York City ; Arthur R. Robinson,
Industrial National Bank, Providence, R. I.
Mrs.
New
All
Edde K. Hays, Dean Witter A Co., Chicago; Frank L. Reissner,
Indianapolis Bond & Share Corporation, Indianapolis; Paul W.
Fairchild, First Boston Corporation, Chicago
Richard
B. McKinney, Taylor & Co., Los Angeles; Mr. & Mrs. John J. Fosdick, Eddleman, Pollok,
Fosdick, Houston; Mr. & Mrs. Richard Bingham, Bingham, Walter A Hurry, Inc., Los Angeles
William F. Gliss, John C. Legg A Company, New York; Preston J.
F, S. Moseley A Co., Chicago; David C. Packard,
John
C. Legg
11 "
' — A
* Company,
"
"
'
New York
Mr. A Mrs. Davies Robertson, Albert McGann Securities Company, South Bend, Ind.; Barney Dreyfus s,
Ferris A Co., Washington, D. C.; James F. Gallivan, Alester G. Furman A Co., Greenville, S. C.
Rebels
Trust
Mr.
&
Mrs.
Richard C.
Vincept Newman, Charmer, Newman Securities Company, Chicago;
g, William Darmstatter, Stifel, Nicolaus A Company, iIncorporatedi»
ncurporo
St. Louis; Chuck
'
" "
" Co.,
"
'
Miller, Mullaney,
Wells A
Chicago
r
iiuniu
vcuuiotauci.
nivviuud
uc
p
Swagler, Odess, Martin, Sellers, Doe A Bonham, Birmingham;
W. Chandler, W. L. Lyons A Co., Louisville
James
Mr.
&
Mrs.
194
Volume
Clarence
F.
Co., St.
dumber 6120
.
.
101
The Commercial and Financial Chronicle
.
E- William Darmstatter, Stifel, Nicolaus & Company, Incorporated, St. Louis; Mr. & Mrs. Vincent
Newman, Channer, Newman Securities Co., Chicago; Mr. & Mrs. Newell S. Knight,
Blewer, Blewer, Glynn & Co., St. Louis; Mr. & Mrs. Kelton E. White, C. H. Walker <fi
Louis; Mr. & Mrs. J. Earle Jardine, Jr., William R. Staats & Co., Los Angeles;
& Mrs. Charles H. Schimpff, Investment
Company Institute, Los Angeles
Mr.
Continued
from
broad
out
page
99
authority for the
airlines to obtain a large portion
of new mail
carrying business.
new
decision
The final
the carriers will
as
to
whether
be able to avail
themselves of this
authority must
Congress however and
expected to take a year at
be made by
it
is
least
before
decision
a
will
be
rate-making flexibility to the in¬
dustry.
The
Board
concern
over
portation
crease
tax
the
and add
aviation
Service to contract
its airlift business to the private
a
more
realistic basis.
Also, the revocation by the CAB
minimum
be
tax
1962, the CAB
additional fuel
be conditioned upon removal
1961 of its 15-year-old
the
air
year
considered
freight
as
order
evidence
may
of the
Board's willingness to allow more
that
any
transportation tax. In¬
dustry estimates as to the cost of
the jet fuel tax are considerably
higher.
Congress did not remove
10%
It
is
transportation
tax
this
and the jet fuel tax question
has been
ter
the
ing burden to an industry that is
already in far from robust finan¬
more
put off until next
difficult
to
year.
comprehend the
this
behind
cial condition.
Mergers
Airline
well result in
may
introduction
of
considerably
the
into
competition
time
have for
been
widely
As previ¬
in
discussed
solutions to the problem of excess
competition in the airline indus¬
try.
The major development in
in 1961
area
Capital
the
merger
first
of
of
number
the
between
quite
proval of this
The
in
a
has
CAB
clear that its ap¬
merger should not
be taken
as a "green light," em¬
phasizing that such action was
literally the only practical course
available
in
of the
view
refuse to certificate
critical
Capital. How¬
new
CAB
competi¬
tion
traffic.
There
turbine
are
aircraft
than 200
more
in
international
service today and the number is
increasing constantly. For prestige
reasons
many
of the smaller na¬
tions, including a number of the
newly independent ones, are en¬
tering the international transport
market.
uled
There
are
18 sched¬
now
airlines,
except where justified on
economic grounds. Final decision
of the CAB in this particular pro¬
including 1 the two
United States flag operators, ply¬
ing the North Atlantic routes and
ceeding ^should be indicative to
whether such recom¬
with jet
the industry
mendation will be heeded.
International Air
tional
air
transport
we
nant factor here also. As
carriers
international
additional
in
join
the
and
ranks
of
competition, and
as
jet aircraft
capacity
service,
more
are
of them
one
market
equipped
are
aircraft.
Although passenger
traffic
placed
continues to
8%
over
last
year,
the
comparable
period
seat capacity expanded
by about 41%. As a result of this
imbalance,
over
load
average
factors
the North Atlantic have been
adversely
affected.
Load
factors
during the four peak months June
through
September
increase faster than the growth in
Continued
on
averaged
page
CAB Chairman Allen C.
Boyd has gone on record several
ever,
times in the past as favoring mer¬
gers.
Specializing in Retail Distribution of
Denault % Ca
Russ Building,
1931
out very strongly on this
subject, indicating that "mergers
probably present the best solu¬
tion" for easing the plight of sev¬
eral of the financially weak lines.
He stated that if merger studies
are
not
the
lines
undertaken
promptly by
themselves, he person¬
feels that the CAB should
ally
San Francisco 4
studies for the pur¬
initiate such
Bell System Teletype SF 272
Telephone EXbrook 2-7484
recent statement, Mr. Boyd
a
spoke
Corporate Securities
ESTABLISHED
In
of arriving at recommenda¬
pose
tions
lines
should
Mr. Boyd mentioned that
criteria
as
which
to
as
merge.
CAB
for
approval
a
must be in the public in¬
merger
terest, providing better service to
Specialists in Western Securities
and it must result
continuation of effective
people,
more
the
jn
A Tradition
Cpjmpetition between airlines.
of Service that began with the West
The action of the CAB with re¬
\ BROKERS
spect to the decision whigb it will
be required to make in th§ rela¬
tively near future when it com¬
pletes its Cleveland competitive
\ DEALERS
\ UNDERWRITERS
\ DISTRIBUTORS
^
STATE AND
investigation will afford
both within and with¬
out the indu§tpy an excellent op¬
service
\ MERGERS and REORGANIZATIONS
observers
\ MUNICIPAL UNDERWRITINGS and DISTRIBUTIONS
\ ADVISORY SERVICE TO MUNICIPALITIES
tude of the CAB toward the prob¬
excessive
of
lem
\ MARKETS IN LEADING
OVER-THE-COUNTER
portunity to judge whether the
seemingly more sympathetic atti¬
competition
to
or
illusory.
operate
in
competition
(Mforw apd its ppliticaj subdivision^
with
Jelephpne:
464 California street
§an frenpjsce £0
paijfprnia
WELLS FARGO
United Air Lines in fpur markets
Schwabaclier & Co.
Our
42nd Year
(three of them involving Cleve¬
land) where United now has no
BANK
airline
competitor
due
tp
its
with Capital Airlines. Most
of the ten airlines which are geekmerger
\ A
Members: New York Stock Exchange • Pacific Coast Stock
AflWikan Stock Exchange (Associate)
principal security and commodity exchanges
TOO
New York
Nqpa
Montgomery St. SAN FRANCISCO
Boise
4 SUtter 1-5600
Honolulu
Los Angeles
Monterey
Palo Alto
Sacramento
Salt Lake City
Santa Barbara
Santa Rosa
Watsonville
Oakland
San Jose
Exchange
Fresno
authority to operate in cer-
ing
tin
or
asked the CAB to include in
the
investigation
If
route
TRUST
applica¬
involving
new,
throughto markets other
directly involved.
the CAB acquiesces to the lat¬
plane
than
AMERICAN
all of the four markets have
also
tions
service
the
of
JSpeeiaJiziiig jn General Obligates ©f fte
is
Purpose of the
investigation is to select carriers
real
SECURITIES
in
during the first nine
months of 1961 increased by about
find that
excessive competition is the domi¬
more
all but
this
Transport
Turning to the field of interna¬
major
industry
years.
it
the United-
which represented
merger
elements
made
was
the
that
recommended
has
some
government, industry and finan¬
cial
circles
as
offering logical
this
four
markets, and into other markets,
than
was
present prior to the
ously mentioned, Project Horizon
Solution?
the
mergers
financial position of
IN CALIFORNIA
requests it
United-Capital merger.
in¬
tax
the fuel tax would- cost the indus¬
of the 10%
Oct. 1,
fares,
gasoline
jet fuel. Stating that addition of
on
Air Transport
on
air
on
proposal
which would add such a stagger¬
thinking
two cent per gallon tax
a
has urged
respect
on
its
proposal to retain the 10% trans¬
to air cargo the
CAB has been urging the Military
carriers
indicated
try $34 million in
forthcoming.
With
has
the Administration's
First National Bank, St. Louis
four
MEMBER FEDERAL DEPOSIT INSURANCE
CORPORATION
gXbrooK 7-441|
Teletype; SF 282
102
102
The Commercial and Financial Chronicle
.
.
.
Thursday, December 28, 1§61
M
Continued from page 101
concepts
about
markets.
68%
53%
this
the
in
Even
1960
more
mestic
down from
period.
year,
market,
air
international
the
voring
tions
the
routes
first
are
With
gteat increase in available
the
traveler
average
interested
and
in
than
economy
orous
more
concluded
lateral
been
against
year
U.
S.
past year has
the
of
commenced in
seen
a
con¬
decline, which
1950, in the
about
relative
position of the United
States flag carriers on the inter¬
each
that
trans-Atlantic
in
has
dropped from about 63% to about
States
about
between
the
55%
of
United
Latin America in
flag
the
lines
traffic
States
and
1960, down from
about 80% in 1950. Their percent¬
age
of
the
Pacific
business
has
recently been about 67% as com¬
pared with almost 79% in 1953.
so
access
to
our
available
than
market
American
to
flag
is
car¬
riers through a reciprocity agree¬
with the
foreign airline's
ment
particular country of origin.
Furthermore, most aviation
thorities
sons,
au¬
overly generous in
other
homeland.
such
in world
in
decline
have been such
questions
as
as
foreign countries in
the particular line's
Most foreign govern-
mets have tended to be consider¬
ably
the
to
other countries
markets.
of
to carry
expanded their
However, the rapidity and extent
operations
recent
years
to raise serious
ML.
traffic between the United States
and
air
A
r
the United States has been
addition
as
"
feel
inclined to be
including the early 1950's, would
strengthened and
x
f
:
that, for diplomatic
and other politically inspired rea¬
international air traffic up to and
tend to decline
■;iv-
profit potentiality to a
airline which is granted
lines which enable them
pre¬
ponderance of post World War II
-ii
i'
traffic
port, which had carried the
logical expectation
Robert King, Jr., First Securities Corporation, Durham, N.
C.; Frank A. Chisholm, Varnedoe, Chisholm
&
Co., Savannah, Ga.; Mr. & Mrs. Charles M. Werly, George Putnam Fund, Boston; Frank L.
Newburger, Jr., Newburger & Co., Philadelphia; Allen Weintraub, Newburger & Co., Philadelphia
country.
that U. S. international air trans¬
a
P
the
granting so-called "third country"
or "and beyond" rights to foreign
It has been
r
coun¬
generates
single
■
ca¬
service
to such
it
t
Thus the United States offers far
the
market
sufficient
international
other
any
greater
participation
or
country
more
than
■
'■ I'
the
and
the
principle
should be al¬
adequately
this
much
foreign
United
bi¬
problem in connection with these
agreements in view of the fact
years
40%.
on
coutry
pacity to
ten
carried
nations
schedule
to
national air lanes. During the last
their
«;
with
try. The U. S. flag carriers, how¬
ever, are faced with an obvious
Flag Carriers Continue
tinuation
such
traffic flow from
Losing Ground
The
additional
40
some
agreements
founded
of the North
last year.
t
'1
;
United
U. S. All of these agreements have
that
this
the
and
glam¬
Atlantic total in the
1
;•
the
foreign
nations with respect to air routes
lowed
84%
by
between
features of first class travel.
quarter
States
into
Kingdom in 1947, this country has
Economy class accounted for 90%
third
the so-called
Agreement
speed
of
the
in
the
with
these
in
Bilateral
entered
was
United
fa¬
space
seems
the factors
which
on
accomoda¬
class.
Beginning
Bermuda
do¬
travelers
class
economy
over
in
than
so
of competition
restrictive in granting
rights to the U. S. flag carriers. Also the degree to which
foreign carriers have been
al-
Daniel
New
C. Kennedy, Lord, Abbett & Co., Chicago; Mr. & Mrs. Albert
Hughes, Lord, Abbett & Co.,
Ycrk; Roald A. Morton, Blue List Publishing Co., New York; Mr. & Mrs. Gustave A.
Alexisson,
Walston & Co., Inc., New York
more
to certain of the basic
Continued
cn
page
;
103
:A
eC°ND C£:/V^
SINCE
✓
1858
//
"*c,„
SUTRO
Investment Dealers and Brokers
MEMBERS:
New York Stock
Montgomery Street
•
CO.
&
Underwriters
Exchange
American Stock
460
•
•
Joseph J. Muldowney, Scott & Stringfellow, Richmond, Va.; Mark A.
Smith, F. W. Craigie & Co.,
Richmond, Va.; Arthur S. Friend, Folger, Nolan, Fleming-W. B. Hibbs & Co.,
Washington, D. C.;
William A. Stevens, J. C. Wheat &
Co., Richmond, Va.
Industrial Brokers
•
Pacific Coast Stock Exchange
Exchange (Associate)
San Francisco 4, California
•
EXbrook 2-0900
TELETYPE: S.F. 308-S.F. 309
Van
Nuys Building
New York
•
•
Berkeley
Los Angeles 14, California
•
San Jose
CORRESPONDENT OFFICES:
DIRECT
•
Beverly Hills
•
•
MAdison 5-7311
Hayward
•
Fresno
HONOLULU, HAWAII; MANILA, P.I.
PRIVATE WIRES TO ALL PRINCIPAL
MARKETS
Harry
N.
Schweppe, Jr., Mercantile Trust Company, St. Louis; Joseph G.
Petersen, Jr., Joseph
& Co., St. Louis; Felix N.
Porter, First National Bank & Trust Co., Oklahoma City;
Floyd Beatty, A. G. Edwards & Sons, St. Louis
Petersen
G
* <■
Bart
Harvey, Alex
Brown <fc Sons, Baltimore; Wheelock Whitney,
Jr., J. M. Dain & Co., Inc.
Minneapolis; Mrs. Joseph R. Neuhaus Houston, Texas; Harold H.
Sherburne, Bacon, Whipple & Co
Chicago; Wallace Latour, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, New York
J
r
J
\ -p
ia
Volume 194
Number 6120
.
.
.
The Commercial and Financial Chronicle
103
Jt'
I ft
Walter
Fidelity
Union
Trust Company, Newark,
N.
D. Seibert, New York; Walter V. Kennedy,
H. Hentz & Co., New York
Stohl,
J.;
Matthew J.
Claude
Mrs.
Continued from page 102
of
lowed to extend their routes into
whether
U. S. cities beyond their gateway
cept
must
be
developed.
The
problem is obviously a very com¬
plex one, involving not only the
economic postures of many na¬
points of entrance into this coun¬
try affects not only the U. S. in¬
ates additional
domestic
but
carriers
ternational
also
cre¬
competition in the
line
trunk
Bermuda
Agreement or
entirely new con¬
Concept
There is
within
to
the
Needed
Be
difference of opinion
a
government today
our
whether
problems
May
solution
a
as
these
to
be arrived at within
can
the
of
framework
principles
vigorous U. S. international
transport system both from
Rotan, Mosle & Co., Houston, Texas
areas
One of the recommendations in
diplomacy and politico-eco¬
The ability of U. S. air¬
the Project Horizon report is that
through self-imposed efficiencies.
in 1960. Traffic
At
nomics.
New
and
John McG. Dalenz, Calvin Bullock. Ltd., New York; Joshua A. Davis,
Blair.,.&
Co. Incorporated, New York;
Walter Sorensen,
of the industry to re-equip itself.
However, it is encouraging to note
the progress which is being made,
not only through the efforts of the
regulatory
authorities but
also
through the industry's own at¬
tempts to solve its cost problems
some
tions, but also the delicate
of
markets.
the
Hickey, III, Hickey & Co., Chicago; George R. Torrey,
& Co., Chicago; Wallace D.
Johnson,
David A. Noyes & Co., Chicago
McCormick
frame
manufacturers
tinue
their
mercial
export
to
sales
con¬
of
jet' transports in
com¬
certain
markets could be affected by
our
air
the
economic
evolved.
a
comprehensive
jectives
the
in
aviation
tional
our
strong
to
undertaken
lem.
a
study
of
U.
S.
least
two
the
The
our
field
interna¬
in
for
service
of
of
terms
of
profitability
carriers and
availability
air
"review
assurance
the
at the
best
lowest
ob¬
of
have
the
industry have progressed
to
with
the
point where
an
for
of the
possible
feasible
they have
been
area
seen
tial
complex.
expected
to
be
introduced into service beginning
in
patterns this
somewhat
gains
ment
is
certificated
S.
in
the
drop
in
the
New
Los
Angeles
substan¬
a
Chicago airport
traffic
York
remained at about the
1965.
year
conflicting,
tending to offset
fit to order small turbo-jet equip¬
which
U.
carriers, operating in
the
Chicago, Los Angeles and
New York areas respectively,
passed the 500,000 mark in pas¬
senger traffic for the first time
members
of
three
helicopter
international aviation relations be
opportunity
importance of
the
military
standpoint, however, demands
that some equitable solution be
actions in dealing with the prob¬
The
and
Helicopters
Continued
same
on
has
level
page
price."
Project Horizon suggests
that such study should include a
review of all rights which have
been exchanged with foreign na¬
Underwriters and
■
£
tions since World War II, includ¬
5 T M
)■
fo?
C
U
R
I
policies de¬
termining
such
exchanges
and
probable future trends. It is en¬
couraging to note that a steering
committee, including representa¬
tives from the CAB, Department
of Defense, Department of Com¬
merce
and
other
governmental
agencies, has been named to su¬
pervise a study of international
air transportation which is to be
made by a private consulting firm.
The
CAB
is currently carrying
on an investigation of the terms,
ing the basis of the
Distributors
/V
Brokers -Dealers
^
FIRST
CALIFORNIA
COMPANY
INCORPORATED
•
MEMBERS:
Pacific Coast Stock Exchange
Midwest Stock Exchange
American Stock Exchange (Associate)
MEMBERS PACIFIC COAST STOCK EXCHANGE
Investment Securities
RUSS
carrier permits. Public
are scheduled for later
this year.
•
California Municipal Bonds
Municipal Financing Consultants
conditions and limitations of for¬
eign air
hearings
Xm
Stone &
BUILDING
•
SAN
Telephone YUkon
Bell
'
FRANCISCO
1-1314
System Teletypes • SF 492 • SF 1139 • SF 799
(Bond Dept.)
Local Service Airlines
FRANCISCO
SAN
300
Montgomery Street
TO
ANGELES
647
South
Spring Street
NEW
YORK
AND
ALL
DIVISION
significant development in
comparatively little known
segment of the air transport in¬
dustry occurred this year when
A
this
Teletype LA 533
Teletype SF 885
PRIVATEi WIRES
LOS
OFFICES
Direct Wires to
Golkin, Bomback & Co., New York
*
Fairman & Co., Los Angeles
the 13 local service airlines began
28
OFFICES
SERVING
INVESTORS
THROUGHOUT
CALIFORNIA
under the CAB's new
system of subsidy.
Unlike the old system of indivi¬
dual
subsidy, which was based
primarily upon the size of operat¬
ing losses, payments to individual
carriers under the
new
system
are based upon a formula which
operating
class mail rate
Wholesale and Retail Distributor
tends to
reward
LIFE, FIRE AND CASUALTY
WALTER C. GOREY CO.
Building, San Francisco 4
Teletype SF 1011 & 1012
—
John C. Legg & Company, Baltimore &
Singer, Bean & Mackie, Inc.,
New York
profitable
Northern California and Nevada
Investors
car¬
opera¬
during the first half of 1961
and
virtually
all have
shown
substantial improvement over the
1960
period. Broadly speaking,
equities of the local service lines
have
shown
price appreciation
this
year,
although the
down
trend in airline stock prices in
general,
which
commenced
in
mid-year, has also been reflected
in
many
of the
local service
N.Y.C.
Wilson, Johnson &
Hi^ins
Members PACIFIC COAST STOCK EXCHANGE
HEAD OFFICE SAN
FRANCiSCQ
465 California Street
YUkon 6-0363
stocks.
It
Wire System
reported
and
...
tions
WEST COAST SECURITIES
Russ
lines who
Several of the local service
riers
INSURANCE STOCKS
YUkon 6-2332
those
economically
operate most
efficiently.
Serving
is
much
whether the
complish
CAB
to
too
new
the
early to judge
system will ac¬
objectives
stimulate
the
of
more
the
ef¬
ficient operation of these carriers,
to
develop more rapid traffic
growth and to increase the ability
OAKLAND
SUSANVILLE
BERKELEY
CHICO
SANTA
ROSA
REDDING
RENO
PARADISE
MENLO PARK
LOS ALTOS
104
104
Continued
last
as
from
103
page
CAB
Total revenue pas¬
carried by the three lines
the
first
six
months
about
decreased
10%
of
1961
the
from
period last year. Revenue
passenger
miles, however, were
up 7%. Operating revenues in the
same
six
this
months
about
1960.
aggregated
year
$4,114,000,
from
down
slightly
continued
The
rise
operating expenses, however,
in
re¬
sulted in operating losses of $334,C00 in the six months period this
with
compared
operating
profits of $129,000 for the 1960
period. The lines continue to be
heavily subsidized and indications
year
that
are
main
able
subsidy
needs
substantial
for
will
the
re¬
However, on a per
available seat mile basis, subsidies
have dropped from about $3.61 in
1954 to
$0.26 in 1980. While breakrelating to the new large
turbine-p owered helicopters cur¬
in costs
rently being introduced into
will
initially
serv¬
larger
require
subsidy, it is expected that
ating economies of the
ment should result in
trend in
The
equip¬
new
a
oper¬
downward
subsidy payments.
introduction
of
machines constitutes
a
new
maj or de¬
capacity of 25-28
a
of the
largest piston engine craft,
substantial
and
improvements
operating
speed,
weather
helicopters should
for
eventual
self
erations by the
in
all-
economy,
capability,
that
year
that the CAB
can spend no more
$6,000,000 in helicopter sub¬
sidies during the fiscal year end¬
ing next June 30. The CAB had
requested $6,900,000.
this
of
action
by
As
result
a
Congress,
the
are(J offering to cargo
various cargo configura¬
tions
combination cargo/trans¬
jets can carry
faster but also be¬
freight
more
the
cause
their
trunk
lines
U.
and
S.
surplus
unwise of Congress to take action
piston
engine
engine equipment into use as allcargo carriers. The total
move¬
ment
of
freight
by air is,
of
course, still very small in relation
to
the
overall
freight business.
which
Less
expansion plans
will
have
to
curtailed this year. Several of
Committee
members
have
pressed the viewpoint that it
hinder
may
these
of
to
appear
point
carriers
be
the
be
the
ex¬
was
activities
just when they
reaching
crucial
a
The
lines, has continued its im¬
pressive growth. A survey con¬
senger
ducted
earlier this year indicated
there
S.
approximately 245
are
and
Canadian
commercial
helicopter operators which last
year did $50 million of business
involving 57 different types of
service. The greatest activity is in
tography, forestry, power-line
trol and crop
pa¬
spraying.
Turning
of
we
excess
thereof
the
to
the
find
subect
of
air
again the specter
capacity and the effect
upon
all-cargo
the
profitability of
operators.
The
air
freight business has been growing
pave
the
way
at
healthy rate for
a
of years
tinued
a
number
and its growth has
this
year.
There
was
car¬
third
which
However
con¬
the
operates
the
over
scheduled
North
Operating "revenues
Atlantic;
the
two
domestic carriers have been
run¬
ning ahead this
of
and one of
Tiger, showed a
net
income
of
$169,000, before
capital gains from sale of air¬
craft, for its fiscal year ended
June 30, 1961. The carrier recently
reported that it lost money in its
fiscal first quarter ended Septem¬
ber 30, primarily due to expenses
the
year
two, Flying
with
putting
new
equipment into service. Seaboard
World
Airlines, the North Atlan¬
all-cargo carrier, showed a
tic
drop in revenues and experienced
operating losses of about $2.6 mil¬
lion
in
the
first
eight months of
this year, reflecting the extremely
competitive
market.
sent
conditions
in
Even these losses
that
repre¬
DISTRIBUTORS
DEALERS
trunk line and U. S. flag carriers.
The
all-cargo lines' portion of
Lower
domestically and
tional
.
.
.
and
municipal
the
and
to
equities
routes.
rate
cated
corporate
bonds
Rates
Essential
both
the interna¬
on
The
reduction
magnitude
task
is
of
indi¬
by the fact that,
studies
conducted
according
by the Air
Transport Association, air freight
rates range anywhere from two
to ten
Direct
private wire
21 offices and 5
system
connecting
correspondent offices
throughout the West and
coast-to-coast.
times the rates for surface
transport of materials and prod¬
ucts suitable for carriage by air.
Other major hurdles in the de¬
velopment of this market exist on
the ground. Not only is there need
for
expanded
and
modernized
ground facilities for handling in¬
A. HOGLE & CO.
.
Members
New
York
Slock
Exchange
and Other Principal
Exchanges
a
in air
creases
the
customers
learn to
tailor
freight volume but
themselves
must
their surface
dis¬
tribution systems so as to obtain
more
fully the benefits offered by
will
Several of the all-cargo carriers
are
new
the
ROCKY MOUNTAIN
both
of
a
planning to place into initial
turbo-prop aircraft, such
CL-44,
a
swing-tail
F. Oates, Jr., president of
Equitable Life Assurance So¬
ciety of the U. S.: i
-C:
"May I remind you as a repre¬
sentative of a substantial investor,
that institutional investors, which
financed all
of transportation carriers,
hope to continue to do so.
"They will, however, be forced
out of this type of investment if it
have for many years
types
to
the
Besides the introduction of
new
it
that
allow
It
ice
contract
was
The
rates.
CAB
air-truck
and
be
of
as
War I,
which
coun¬
and by
a
It
is
thought
that
ownership-nationali¬
the alternative of "ade¬
quate earning power under pri¬
vate management"
be
applied
to
the
might equally
air
transport
industry.
•
Respectfully submitted,
SECURITIES
A
controversial point
is that
COMMITTEE
relating to the currently proposed
Edward J. Morehouse, Chairman
legislation for making low inter¬
Harriman Ripley & Co., Inc.
est rate, government guaranteed
available
loans
to
finance
pur¬
chases of all-cargo aircraft. Mem¬
bers of previous aviation securi¬
ties
committees
have
indicated
a
with which we
concur,
that (a) such government guaran¬
teed loans would not necessarily
belief,
be of
major importance in the de¬
velopment of the air cargo busi¬
ness
and
(b) that implementation
such
loans
nation's
basic
of
is
contrary
to
our
philosophy of free
enterprise. In this connection sev¬
eral of the all-cargo carriers are
currently
asking
that
they
be
made
eligible for direct subsidy.
The CAB has been
reviewing the
indirect,
to these carriers
ruling is
and
a
expected shortly.
New
Courts &
William
another
difficult
for the air transport indus¬
A.
Forrester, Jr.
Merrill
Lynch, Pierce, Fenner
Smith Incorporated
York, N. Y.
&
New
Walter M. Giblin
Blyth & Co., Inc.
New
York, N. Y.
William Barclay Harding
Smith, Barney & Co.
New
York, N. Y.
Herman H. Kahn
Lehman Brothers
New
York, N. Y.
Richard W. Millar
William R. Staats
Los
This has been
Co.
Atlanta, Ga.
Conclusion
year
York, N. Y.
Richard W. Courts
&
Co.
Angeles, Calif.
James P. Mitchell
The
New
SECURITIES,
Chase Manhattan Bank
York, N. Y.
municipal and corporate,
call wire
or
write
State and
Municipal
U. S. Government
Bonds
Bonds
BOND DEPARTMENT
and
INVESTMENT
BANKERS
•
SECURITY BLDG., DENVER 2, COLO.
Member of the Mjdwtst Stock Exchange e
Company, Inc.
AMherst 6-1981
•
Teletype DN 296
Seattle 24,
Telephone MAin 2-3131
the
respect to
with
words
government
zation
govern¬
foreign nations.
AVIATION
as
design
in World
speaker's
with
thereof
suffered by this
sobering
a
ex¬
plored as a possibility for ex¬
panding the use of air freight.
operation
number
chairman
rates
experiences
try,
business to private lines at prifitable
bitter
ment
had been
was
government
more
hapnens that the principal
of Mr. Oates' remarks
the railroad industry and the
so
subject
"maximum
carriers
the
afford that al¬
cannot
ternative."
of the trunk line carriers
disapprove of this action by the
CAB, fearing posible! rate wars,
has stated
difficult to
clear
a
zation. We
many
Board
more
prospect of adequate
earning power under private
management. The alternative is
Government ownership-nationali¬
see
equipment, the past year has seen
other developments of importance
to the air freight industry. The
CAB, for example, in October of
this year reihoved its longstanding
minimum freight rates. Although
the
much
becomes
competi¬
more
excerpt
an
James
tive rate structure.
operation, sometime in early 1962,
prime distributions of all
conducive
be
is
following
talk recently given by Mr.
a
the
powered equipment and the ex¬
pected operating ec onomies
development
too
concerned
with
this
industry to exert maximum
toward meeting its prob¬
The
from
being developed for the Air Force.
Its
proposed pay-load of about
75-95,000 pounds compares with
the 50-65,000 pound pay-load of
the
CL-44 turbo-prop. The
in¬
dustry is confident that the ad¬
vent of such specialized turbine
thereof
before
lems.
be
subject of subsidy, both direct and
air freight.
For
will
a
jet cargo aircraft, employing
turbofan power plants, which is
rail
continues to be lower rates,
securities
able
there
recently suggested that joint air-
A key to the successful devel¬
opment of the air freight market
quality
part of the carrier.
avail¬
civil version of the C-141,
that
found
realistic and sym¬
indirectly
vital
effort
flexibility and opportunity to ex¬
pand with promotional rates." As
previously mentioned, the CAB
has also continued to urge that
the Military Air Transport Serv¬
total air freight in 1960 amounted
to only about 25%.
Investment-
powered
aircraft and therefore less invest¬
the
be
more
pathetic attitude on the part of
regulatory authorities is per¬
haps the most hopeful of these
signs. Much remains to be accom¬
plished however, and it is incum¬
bent upon the airlines, the au¬
thorities and all others directly or
ment
on
a
the
equipment, with its increased tonmile capability, promises not only
substantial reduction in operating
costs but requirements for fewer
when the carrier suffered
operating losses of $6,383,000.
ever,
UNDERWRITERS
turbo-fan
of
Use
may
long. The increasing indica¬
tion of
port
configurations
of
existing
military and commercial turbopowered transport
aircraft
such as the C-135, 707, and DC-8.
removing the rate floor in order to
1960
lems
very
fan
improvement over the
eight months period, how¬
an
Most of the total air freight con¬
tinues to be carried by the large
BROKERS
or
pected
only two U. S. cer¬
tificated all-cargo carriers in
scheduled domestic service plus a
service
in spite of the
serious problems which the
air carriers continue to face, there
are
encouraging signs that sat¬
isfactory solutions to these prob¬
many
Within four to five years it is ex¬
are
connected
All-Cargo Carriers
cargo
domestic
total
of
so-called "commercial hel¬
those of the three scheduled pas¬
U.
1%
Two Domestic Carriers
icopter" field, which includes all
helicopter operations other than
that
than
inter-city freight traffic
ried by air in 1960.
in their development.
new
carriers.
currently
carriers
the
because
try. Nevertheless,
expected to reduce op¬
is
erating costs considerably. Lead¬
ing U. S. jet transport manufac¬
turers
have
developed and
only
carriers that their operations
and
which
Thursday, December 28, 1961
introduction of jet equipment, not
of
the
op¬
the available capacity. The situa¬
tion has been aggravated by the
flag carriers have pressed certain
etc.
sustaining
total volume of present air freight
traffic is still not sufficient to fill
CAB has told the three scheduled
passen¬
virtually double the capacity
gers,
this
five areas—charter and taxi, pho¬
these
velopment in helicopter transport.
With
Subsidies
ruled
than
foresee¬
future.
ice
Congress
year.
sengers
in
The Commercial and Financial Chronicle
Seattle-First
Washington
Teletype SE 489
National Bank
MEMBER
FEDERAL
DEPOSIT
INSURANCE
CORPORATION
Volume
194
Number 6120
.
.
.
The Commercial and Financial Chronicle
105
i,
Mrs.
&
Mr.
Joseph King, Eastman Dillon, Union Securities
&
Arthur
Co.
York
New
S.
t?
Grossman, Straus, Blosser & McDowell, Chicago; Mr. &
Albert Hughes, Lord, Abbett & Co., New York
sufficient to produce a rate of re¬
Report of IBA Oil, Natural
turn
Continued from page 65
line
financial
of return
and rate
pipe¬
on
made in last
was
year's
report of the adoption by the Fed¬
Commission
of
eral
Power
broad
program for regulating
of independent natural gas
rates
instead of confining itself to the
utility rate base method which it
workable.
not
was
meantime
rate
area
for
two
the
Permian
large
producing
Basin
In
the
proceedings
areas—
southern
and
Louisiana—have been commenced.
Into these
proceedings have been
consolidated
vidual
which
indi¬
of
number
a
cases
is
hope
of a
successful,
risk
of
his
expected to
without the hope
money
something
more
of return which
a
producers on an area price basis,
found
the
in
if he
and that he cannot be
operations.
Mention
risks
large reward
the
involve
than the type
is usual for util¬
ity-type enterprises.
pressed the view that
should
as
serve
floors.
that
the
as
He
He
ex¬
prices
ceilings and not
alluded
area
the
to
fact
these
proceedings have been ordered to
furnish
costs
major
parties
extensive
and
area
rates
fect
without
to
information
stressed
the
of
gas
Power
some
cannot be
own
expressed
views
this
on
general,
There has been a great
change in the membership of the
subject.
Commission, which shortly will
comprised entirely of new
appointees. The comments of the
new
chairman may
perhaps be
regarded as the best available in¬
be
dication
at
this
time
of
what
to
expect in the way of FPC policy
on
regulation of producer prices.
New
Chairman's
Price
The
clearly
that
gas
new
Philosophy
of
Reassuring
chairman
that he does
the
production
lends itself to a
very
believe
of natural
utility-type
cost of service and rate of return
approach.
He recognized that the
independent
producer
it
his
views
will
still
deal of time for any
on
this
take a great
working pol¬
icy to develop from these area
price proceedings; in the mean¬
time many individual applications
which appear to have merit are
being held up to the detriment of
those producers affected.
Pipeline Stocks in Disfavor
Turing to the subject of rate of
return for
takes
real
of
component
capitalization
the
without
talization. Such a policy, if it is a
policy, completely ignores the dif¬
in
ferences
Loewi,
risk
to
the
common
fering degrees of leverage.
pipeline companies, the
creasing cost of senior capital.
The Commission has issued sey-
rate of return in
the last year or so, from which
emerged an apparent pattern of
allowing an overall rate of return
opinions
on
has
been
continuance
a
of
poor
refining
and marketing sector of the oil
stemming
from
over¬
industry
capacity and intense competition.
operating results in
The most
the
important new devel¬
the Canadian oil in¬
in
Minister
Federal
Commerce
of
Trade
rather than coercion to
substantial
and
rise
natural
gas
in
produce
Canadian
industry was expected to
arrange for an increased use of
products in Ontario refined from
,
domestic
crude
by the elimina¬
imports of crude
tion
of these recent decisions has been
noticeably
National
displacement of products refined
from imported crude oil and
shipped into Ontarip from Mont¬
of discouragement,
one
evidenced by the fact that mu¬
tual funds have, on balance, been
sellers of pipeline securities dur¬
as
ing
the
June
months
12
this
of
30
for
which
the
able
at
The
new
which
year,
the
figures
are
time
of
this
Commission
confidence when it
cide several
have
de¬
to
are
now
It is fervently hoped
that, in the interest of consumers
and
investors
alike, the Com¬
"too
forth with
come
little too late."
Economic trends
the natural
in
industry have continued to
show up well.
In the year 1960
gas
new
records
were
National
New
Oil
Policy
set in the
con¬
sumption of natural gas with an
In
crude
well in
rels.
in
a
of
excess
one
This situation
million bar¬
reflected
was
strong agitation for govern¬
mental
measures
designed to in¬
oil
output, and toward the
end of the year it became known
that a thorough study of the en¬
tire
situation was being under¬
crease
taken
for
ment
by
Board.
the
Federal
the
National
Speculation
government
with
the
action
as
Govern¬
Energy
to possible
finally
announcement
increase of 5.7% over 1959. Trans¬
mission main showed
of 4.4%
to
distribution
In
addition, the industry
through its U. S. connections
was expected to secure materially
imported
export
markets,
par¬
ticularly on the U. S. West Coast
where other imported crudes, not
U. S. domestic production, would
be
displaced.
The
entire
cilities
designed as
an
alternative to more stringent
measures involving the capturing
of the Montreal refining market
for Canadian crude through tar¬
iffs,
quotas,
or
other arrange¬
ments. Target levels for Canadian
Production
National
barrels
established
Oil
per
the
Policy
under
were
were
up
on
page
increase
4.9%. Residential
exceeded 30 mil¬
lion in number for the first time.
recoverable
Proved
natural
of
gas
263.8
reached
trillion
end of 1960 in
reserves
a
cubic
Canadian
gas
feet at the
in
oil
and
1961
HESS
&
INVESTMENT
McFAUL
SECURITIES
year.
Developments
Canadian
scene
of
peak
spite of record net
production during the
The
new
American Bank
Portland 5, Oregon
Bldg.
natural
has
been
marked
by three major develop¬
ments.
First, there has Been a
improvement in both
substantial
actual and anticipated crude oil
production.
Second,
there
has
been logical working out of the
Bell
Teletype—PD 254
BLANKENSHIP, GOULD & BLAKELY
INCORPORATED
ESTABLISHED
1929
EQUITABLE BUILDING
PORTLAND
PORTLAND
Bell
FIRST
NATIONAL
BANK
OF
4, OREGON
CORPORATION
OREGON, PORTLAND
System Teletype PD 280
the
625,000
day by mid-1961, an
Continued
183,830 miles of pipe;
main
increased
by
customers
Na¬
tional Oil Policy was
and field and gathering fa¬
5.4%
gas
an
ended
by
oil into Ontario refineries and by
real.
1960, Canadian production of
oil and natural gas liquids
averaged some 540,000 barrels per
day against a production capacity
in progress.
mission will not
back¬
latest
avail¬
writing.
comes
The
Enunciated
will
which
cases
Policy.
ended
opportunity to regain investor
an
Oil
ground to this is significant.
direct
of
\
THE
a
Oil
liquids output.
The
Pacific Northwest Securities
MEMBER FEDERAL DEPOSIT INSURANCE
and
Feb.
1, 1961 of a
National Oil Policy.
This policy
was
designed to use persuasion
on
dustry in 1961 has been the enun¬
ciation early in the year of the
industry is still awaiting evidence
the Commission is going to
adequate increases in rate
of return in order to offset the in¬
granting of the 1960 ex¬
permits.
And third, there
port
Milwaukee;
Loewi & Co., Incorporated,
W. Guy Redman, St. Louis
from the
opment
Investor reaction to the pattern
Mrs.
implications of the improved out¬
look for natural gas resulting
stockholder which result from dif¬
that
eral
common
regard to the degree of leverage
in the particular company's capi¬
allow
stated
not
event,
the
on
a
produced
Commission,
his
of
equity
company's
date
in these -subject may be considered rea¬
and
reassuring but, of
areas, but it is still not clear what sonable
principles of price regulation are course, it remains to be seen
the
administration
of
going to be applied in the out¬ whether
come
of
these
proceedings and these policies and the final treat¬
of
others which may be held in the ment
prices
is
reasonable.
After all, it is often possible for
future.
two parties to agree on a set of
In an address before the Inde¬
pendent Natural Gas Association principles but all too easy to dis¬
last spring, Mr. Joseph Swidler, agree on what it takes to imple¬
ment
those
principles.
In any
the new Chairman of the Federal
prices
10-11%
on
point that
put into ef¬
knowledge of at
least the overall cost of producing
gas within the area.
In
of
stock
Gas Securities Committee
rates
Victor
J.
Mrs.
107
106
The Commercial and Financial Chronicle
.
.
Thursday, December 28, 1961
.
18
?T£.*
/
x*
fSjI
hi
>4
Mr.
Mrs. John Fricke, Woodcock,
Moyer, Fricke A French, Inc., Philadelphia;
Finney, Bear Stearns A Co., New York; Theodore Swick, White, Weld A
&
^*:v':-vvi:'.;'
•
•
Mr. & Mrs. Howard
Co., New York
John
F.
i.
h
4
Bunn, Jr., Bioren A Co., Philadelphia; William E. Slack, Bioren A Co., Philadelphia; Gerald
Writer A Christensen, Denver; James M. Powell, Boettcher and Company, Denver
f:
i
P. Peters, Peters,
-jjPW|fcte -.V: • -.•*4s
4
,
S'%
H
n
Mr.
&
Mrs.
Alan
Gordon,
Royal
Securities
Corporation,
Montreal
Mr. & Mrs. Frederic A. Arnstein, Jr., Stix A Co., St. Louis
Donald
W. Hayden, Baumgartner, Downing A
Co., Baltimore; Allen M. Terrell, Girard Trust Corn
Exchange Bank, Philadelphia; S. Grey Dayton, Jr., Elkins, Morris, Stokes A Co.,
Philadelphia;
Stanley A. Russell, Jr., Blyth A Co., Inc., Philadelphia
Wilson
Parcells
A.
A
Mr.
&
Mrs.
Robert
Craft, Paribas Corporation, New York
Britten, Calvin Bullock, Ltd., New York; Mr. & Mrs. Charles A. Parcells, Charles A.
Co., Detroit; E. Blaine Steele, H. J. Steele A Co., Pittsburgh; Malcolm E. Lambing, Jr.,
Company, Pittsburgh; Joseph F. Zunic, Thomas A Company, Pittsburgh
Thomas A
\'
Mr.
&
Mrs. Max Pollock, Wm. E. Pollock A
Co., New York;
George W. Hall, Wm. E. Pollock A Co., New York
Charles
E.
Lundfelt,
Gilbert
McCormick
A
Co.,
Chicago;
Mr.
Basnik, M. B. Vick A Co., Chicago
&
Mrs.
Edward
D.
McGrew, Northern Trust
McGee, R. W. Pressprich
Company, Chicago;
A Co., New York
Cushman
it.
Hiram Neuwoehmer, White A
Company, Inc., St. Louis; John W. Turner, Eppler, Guerin
Dallas; William B. Eppler, Eppler, Guerin A Turner, Dallas; Mr. & Mrs. Richard A.
Fusz-Schmelzle A Co., Inc., St. Louis; Mr. & Mrs. Roger G.
Stotler, Rowles, Winston A
L
A
Turner,
Schmelzle,
Co., Houston
Edward
F. Johnson, Van Alstyne, Noel A
Co., New York; Lorrin C. Mawdsley, Van Alstyne, Noel A
Co., New York; Gavin H. Watson, Value Line Fund Distributors, New
York; Arthur J. C. Underhill,
Wiesenberger A Co., New York; Lloyd E. Lubetkin, Lubetkin, Regan A
Kennedy, New York
Arthur
.
■
,fo
Volume 194
Mr.
.
.
The Commercial and Financial Chronicle
.
G. Simpson, Simpson, Emery
Pittsburgh
William
Mrs.
&
Number 6120
Continued from page
105
&
Co., Inc.,
in 1963.
complexity
extent
some
this
be
within the
oil industry to
the
the announcement
National Oil Policy was
favorable, the targets
being regarded as stiff but within
the bounds of possibility.
While
many
smaller independent pro¬
duction
companies were disap¬
generally
pointed at the failure to initiate
construction of a new oil pipe¬
from
line
Canada
western
to
Montreal, most major companies
were pleased to avoid the rigid¬
such
ities
which
have
imposed.
move
a
would
During the course of 1961, the
meeting the Na¬
tional Oil Policy targets probably
progress made in
surprising
was
advocates.
est
tion
to its warm¬
even
In
June,
produc¬
averaged some 633,000 bar¬
per
day against the target
rels
625,000.
Toward the
year erfd it became apparent that
the overall target figure for the
figure
of
year
average
by
a
look
of
of
would likely be exceeded
small margin, while the out¬
for meeting the 1963 target
barrels
800,000
per
W.
increase
day
was
by the
supply
re¬
necessary and will
in the long run by
restricted
struction to be undertaken
province
and
the
two
next
completed
con¬
in the
within
some
aggregating
55,000 barrels per day.
The
real
area
was
from
progress
was
the export field.
U. S. West Coast
50,000 barrels per
to the
Exports
rose
years,
where
made in 1961
some
day in 1960 to an indicated level
for 1961 of some 93,000 barrels,
the
increase
representing
a
Austin
Lubbock
•
•
cautious,
and
repeated
forthcoming
were
not
that
the
force
warnings
Canada
pace
Midwest Stock Exchange
Exchange (Associate)
Dealers
•
Distributors
•
•
to
Canada's National Oil Policy was
Company Stocks
Funds
Industrial
Common Stocks
—
Riverside 8-0111
Odessa
resent
no
more
Fort Worth
•
San Antonio
•
Harlingen
Tyler •
•
Houston
Fayetteville, Ark.
of
had
actual cut¬
no
ex¬
than
a
normal
into the
newly penetrated Detroit-Toledoleveling
off
Buffalo
areas
of., exports
the
after
initial
Pipeline
BC
New
Nearing
Completion
interesting
in
the
has
line
to
side
1961
the
been
develop¬
Canadian
oil
commence¬
Mr
& Mrs. Joseph R. Neuhaus, Underwood, Neuhaus & Co.,
Houston; John T. Knox, Federal Land Banks, New York
Vancouver
at
Kamloops.
the
there
of
is
greatly
and
no
that
doubt
exploration
oil
stimulate
will
it
development in north-eastern
British
Columbia.
the
At
same
time markets for Alberta oil will
to
and
new
Columbia
acquire
tion
a
with
The
not
cut
back
ince
with
the
British
the
area
oil
Colum¬
fields
in
of the Prov¬
Trans
Mountain
out in
the
of
three
export proj¬
approved
of construction
markets.
Thus natural
has
Canadian
for
been
oil
improved
the
in
to
Policy in
increasing production, but also by
an improvement in the well-head
only
by
success
crude.
This
improve¬
ment, 10 cents per barrel for light
grades and up to 18 cents for
some medium gravity crude, has
stemmed primarily from a
re¬
duced
exchange
value
for the
Canadian dollar brought about by
ing the year with a view to im¬
proving C a n a d a's international
of
One
ects
course
completion
oil
been worked
1961.
production which will
direct pipeline connec¬
ment of the construction
(due for
the year-end) of
pipeline entirely within
proval have
the other two had facilities in the
be
date of the National Oil
of
the
by
outlook
producers
1961
-
on this approval.
Some
implications of the ap¬
sequent
unproprated British
degree
some
the
export projects and to
greatly improved outlook for
Canadian gas industry con¬
the
last year was in
operation throughout 1961 while
Canadian Government action dur¬
by
nadian gas
Despite arguments regarding tne
economic as oposed to the politi¬
cal justification for the project,
price
buildup period.
the Peace River
reaction
area
U.
connecting
Utility, Railroad and
Corpus Christi
the
to
bia
S.
the
at
S. is currently
expected, some easing of their
rate of growth now seems likely;
this, however, will probably rep¬
ports
Detroit-Toledo-Buffalo
U.
ex¬
back in levels of Canadian oil
Province
areas.
quarters
While
the
initial
was
much faster than had been
gone
Canadian crude for the first time
The
S.
saying that the rise in
as
an
refining
concern
Canadian oil flow to that
ming primarily from the entry of
Preferred Stocks
Midland
some
scene
1, Texas
•
in
65,000 barrels per day in 1960 to
an indicated level of some 91,000
barrels in 1961, the increase stem¬
the
U.
growth of Canadian ex¬
ports to the U. S. Midwest, and
U. S. Interior Secretary Udail was
An
into
the
to
of
ment
areas,
Mercantile Dallas Building
Dallas
rate
1961
not¬
Mutual Investment
—
pressed
of
ably the Midwest, rose from some
Bank and Insurance
Bonds
end
refineries;
connected
Exports to other U. S.
Municipal Bonds
Public
the
greater use of Canadian crude by
previously
Underwriters
•
exports
anticipated.
refinery
new
Member
Brokers
of
beyond reasonable levels. Toward
nouncement of
Exchange
American Stock
growth
quoted
Rauscher, Pierce & Co., Inc.
New York Stock
Harley Rankin, Goldman, Sachs & Co., Philadelphia;
Ewing, A. E. Masten & Co., Wheeling, W. Va.
refinery capacity. Thus
perhaps the most important de¬
velopment in Ontario was the an¬
should
encouraging.
the
of
Ontario, but
limited
was
use
available
640,000 barrels per day
a
increased
an
of Canadian crude in
arrangements
Favorable Reaction
of
Mrs.
Progress made in 1961 reflected
to
reaction
&
R.
of 640,000 barrels per day
over the
whole of 1961, and an
average of 800,000 barrels per day
average
The initial
Mr.
107
trade
position.
The 1960 Report
but
struction
gas
Com¬
in
that year of three major new
Ca¬
were
for
demand
not
in
gas
that
product.
Con¬
the natural
activity
industry
dented
was
in
at an unprece¬
level, not only in connec¬
tion with the
main trunk
construction
lines involved
of
the
in the
Alberta to California export proj¬
ects
and
their
related
gathering
also in connection
with gas processing facilities in
gas
fields
throughout
Alberta.
systems,
but
The bulk of this construction was
running
of this
mittee referred to the approval
during the
operation.
production, ris¬
ing from 1,238 million cubic feet
per day in 1960 to an estimated
1,700 million in 1961, only began
to
reflect
the
increased
export
year
ule
and
as
substantially
the
will
year
result
on
sched¬
drew to a close,
the operation
in
Continued
on
page
108
108
The Commercial and Financial Chronicle
W.
J. Wallace, Mellon National Bank & Trust
Co., Pittsburgh;
Shelton, Republic National Bank, Dallas; Anthony E.
Mrs.
Tomasic,
Anthony E. Tomasic; Lockett
Thomas & Company, Pittsburgh
Mr.
&
Mrs
Elwood
Boynton,
.
.
.
E. D. Boynton & Co., New York; Mr.
Webber, Jackson & Curtis, New York
Sanders
Perkins
&
Company, Inc
Thursday, December 28, 1961
&
Corporate Securities
XI
MUNICIPAL BONDS
•
CORPORATE SECURITIES
•
BANK & INSURANCE STOCKS
PRIVATE PLACEMENTS
MERCANTILE
DALLAS
RIVERSIDE 8 0033
BANK BUILDING
1, TEXAS
TWX
DL
Exchange
BANK BLDQ.
Dallas
•
Mrs.
James
Company
Members New York Stock
REPUBLIC NATIONAL
&
Lowell,
Paine,
Number 6120
Volume 194
...
The Commercial and Financial Chronicle
•
UNDERWRITERS
•
DISTRIBUTORS
•
BROKERS
•
CORPORATE
Rollin
Bush,
DEALERS
AND MUNICIPAL SECURITIES
National City Bank of New York; Jack Cpuig, Hirsch & Co., New York; Ed
Dillon, Union Securities & Co., New York; Tom Feeley, Goodbody & Co., New York
First
O'Leary, Eastman
SAN ANGELO
McALLEN
FORT WORTH
MEMBERS
NEW
AMERICAN
Mr.
&
Mrs.
Charles
R.
Treuhold, Paribas Corporation, New York;
Carl
Mr. & Mrs. John N.
_
M.
Loeb, Rhoades
&
Mitchell, Caldwell, Marshall, Trimble
C. Ebbitt, Shelby Cullom Davis
Mr. & Mrs. Joseph F.
Co.,
New
Mr.
&
Mrs.
Richard
EXCHANGE
STOCK
YORK
STOCK
EXCHANGE (ASSOC.)
N. Beaty,
York
& Mitchell, New York; Mr. &
& Co., New York
Lockett, Townsend, Dabney & Tyson, Boston;
McDougal & Condon, Chicago
Mrs. Kenneth
Mr. & Mrs. Edward Carpenter,
Decision
The
Close per¬
of Southwestern firms enables
meeting is over, the course is set, the decision is made.
sonal contact with top management
Parker, Ford to interpret business
Parker,
activity. You might call it the human
Ford has research information in depth,
element in research. Parker,
Ford has research information and maintains firm
markets in: American Life
Duncan Coffee
Investments
Insurance of Alabama
Electro-Science
Frito
trading
Bauer Aluminum Co.
Oklahoma Cement
Wallace
Westgate-California
Parker, Ford & Company, Inc. Investment
Bankers
Members Midwest Stock Exchange
DALLAS:
Mr.
&
Mrs.
Abner
Government
Kalisch,
Jr.,
Banco
Government
Popular de Puerto Rico, San Juan;
Salvador Rodriguez,
W. Grimm,
for Puerto Rico, San Juan; Mr. & Mrs. Richard
Development Bank for Puerto Rico, New York
Development Bank
Downtown & Exchange Bank
AMARILLO
LUBBOCK
SHERMAN
PARIS
WICHITA FALLS
FORT WORTH
ABILENE
LAWTON
TULSA
TEMPLE DENTON
EL PASO
HENDERSON
Facts: over 100 full time salesmen
connected wire system between
in 15 offices / 9-man trading room with inter¬
all offices and all major security markets
110
The Commercial and Financial
Mr. & Mrs. Harry Sebel, Selected Investments Company, Chicago;
Brothers & Hutzler, Chicago; Frederick W. Straus, Straus,
Theodore P.
Mr. & Mrs. Harry Brown, Salomon
Blosser & McDowell, Chicago
Swick, White, Weld & Co., New York; James A. Conlin,
Hayden, Stone & Co., New York; J. Wells Coggeshall,
Colonial Distributors, Inc., New York
Stewart
A.
Dunn, C. J. Devine A Co., New York;
Lewis F. Lyne, Mercantile National Bank, Dallas;
Mr.
&
Mrs. William
J.
Falsey, Chas. W. Scranton
Conn.
New Haven,
Mr.
&
&
Co.,
Norman J.
P.
.
.
Thursday, December 28, 1961
Joseph E. Smith, Newburger & Co., Philadelphia; James W. Wolff
Zuckerman, Smith & Co., New York; Frank J. Ronan,
New York Hanseatic Corporation, New York City
Harold W. Clark, Clark, Landstreet & Kirkpatrick, Nashville; R. George Le Vind, Blyth A Co., Inc.,
New York; H. Frank Burkholder, Equitable Securities Corporation, Nashville; Ronald M. Courts,
Cruttenden, Podesta & Co., New York
Alexander, James Richardson A Sons, Winnipeg, Canada;
Mrs. Frederick T. Seving, Philadelphia
Mrs. John E. Fricke, Woodcock, Moyer, Friche A French, Inc., Philadelphia; Francis
Magoun, III, National Shawmut Bank, Boston; Thorburn Rand, Rand A Co,, New York
.
Mr. & Mrs. Wallace D. Johnson, David A. Noyes & Co., Chicago; Mrs. Paul B. Hanrahan, Worcester,
Mass.; J. Raymcnd Boyce, Auchincloss, Parker & Redpath, New York
Wendell W. Witter, Dean Witter & Co., San Francisco; James C.
Kellogg, III, Spetnr, Leeds & Kellogg, New York; Michael L.
»
Bregman, M. L. Bregman & Co., New York
Gene Lee, Valley National Bank, Phoenix; Howard H. Banker, C. J. Devine A Co., Cincinnati;
John T. Knox, Federal Land Banks, New York
Chronicle
James
M.
Powell, Boettcher and Company, Denver;
Joseph
Refsnes, Refsnes, Ely, Beck A Co., Phoenix, Ariz.
E
Charles C. Bingham, William Street Sales, Inc., Los Angeles; Mr. & Mrs. Arthur
Quinn, Quinn A Co.
Albuquerque, N. Mex.; James H. Shells, Gregory A Sons, New York
Volume
194
Number
6120
.
.
The Commercial and Financial
,
Continued from page 108
can
larger.
While the United States
should add 37 million people by
continent.
foreign
free
1970,
increase
should
by
population
250
is
times faster
three
time
a
States.
At
than
in
43.5
barrels
activity
will
remain
leum
products, relative to the rest
of the free world.
Europe
at
high levels for
notwithstanding pe¬
Competition
fluctuations.
There is little
Until
oil
reserves
to
support
in demand
of
However,
rently in
its
doubt that crude
are
than ample
more
the
estimated
growth
the next 10 years.
over
these
reserves,
of
excess
230
cur¬
million
"International"
for
Companies
the
the
two
past
United
States
or
ital
panies
these
com¬
able to show a steady
were
The
rels.
the Middle East with 68 % of re¬
serves and less than 1% of con¬
companies, observing the increas¬
ing earnings of the internationals,
were determined to participate in
this bonanza.
Consequently they
sumption.
invested
noticeable
A
trend
in
United
counts for
barrels,
world
has been the desire by peo¬
ple in foreign areas to own an
years
foreign
has
but
In
of free
only 15%
sharp contrast is
In fact, Middle Eastern
could
reserves
than 50%
more
demand
of reserves.
recent
increase
satisfy
all
the
of
This has resulted in
growth of registered private¬
ly-owned cars from 12 to 32 mil¬
lion
in the
past decade. Also,
while the number of people per
car is still very much higher than
in the United States, it has de¬
ing the next decade if adequate
producing and transportation fa¬
cilities were provided and politi¬
cal stability assured.
During 1960 free world con¬
sumption of petroleum products
order to
clined from
totaled
growth in
curred
120 to
Most
decade.
in
in the past
52
of
the
foreign
ownership has oc¬
Europe. Over
car
Western
the past
decade, automobile regis¬
trations
there
lion to 21
of persons
rose
from
six
car
continued
The
high
level
of
industrial activity in Western Eu¬
rope
has supplemented this trend.
The
economies
tions in this
of
area
erate at close to
ards of
raised.
products
States
advanced only 2.4%
b/d, while
to 9.7
increase of
an
recorded by all other
free world countries. At the same
time
all
of
the
na¬
continue to op¬
capacity
as
stand¬
production
of
crude
oil
in
living
are constantly being
Consequently, European
lion
b/d, an increase of approxi¬
mately 6% over the 1959 figure.
During this period Eastern Hemi¬
sphere production increased
15.8% while Western Hemisphere
production increased 1.4%. Thus
the
pronounced
States
plant capacity and
a consumer
Ameri¬
trend
of
recent
continued with the United
years
companies have steadily increased
many
these
showing
a
decline
as
an
producing
tons
offset
partially
tons
scrapped
other
uses.
the
construction
produc¬
of
the
deal of
receiv¬
in
progress
toward
ample
companies,
thus,
well
as
alternative
as
the creation
of
sources
of
50-60
tankers
higher share of the profits.
However, the resistance of the oil
of
million
2.8
converted
or
to
The trend toward the
great
a
by
alliance for
a
sentiment
with the deliv¬
4.7%
or
of 5.6 million tons which was
ery
purpose
Within
pressures
while
rates
still
is
smaller
older,
There
is
capacity available;
are
making
still low,
Continued
supply,
size
retired.
are
tanker
tankers
larger
DWT
on
page
113
Venezue¬
and
1957.
in
maintain their dominant
their
bought
share
When
concessions.
oil
rc
COf
of
AND
MUNICIPAL
SECURITIES
.
in
quantities was found
in
Maracaibo, and Middle East¬
ern
production continued to ex¬
pand, resulting competition for
markets caused lower prices and
profit margins. Also in 1959 the
Venezuelan Government imposed
higher income taxes.
large
Lake
All
Fridley <£.
Fredevkireg
decline
in
the
re¬
Member* Midwest Stock Exchange
foreign invested
capital
Many of the
"newer" international companies
which made initial foreign
ex¬
penditures in the middle 1950's
have yet to report foreign profits.
to
on
13%
in
Moreover
forced
BANKERS
INVESTMENT
factors resulted in
of these
precipitous
a
turn
1960.
some
of
them
may
TEXAS
BANK
NATIONAL
HOUSTON
Teletype HO 42
Telephone CApitol 8-8221
be
BLDG.
TEXAS
2,
to
give up part of their
producers' profit in order to mar¬
ket their output.
More
both
and producer of petro-
new
1956
internationals,
existing
position,
was
the free world averaged 17.7 mil¬
15.
47 to
b/d, a gain of
Usage of petro¬
in
the United
1959.
leum
12.4%
declined from
million
19
over
millon
mil¬
million while the ratio
per
7%
heavily in
lan concessions in
form
lion
ing countries, there is still
ing
their
on
capital through
1955 when a figure of 30% was
reported.
Other United States
The
the
return
invested
world's needs for petroleum dur¬
automobile.
the
on
Eastern
to
recent
During 1960 the tanker fleet of
production.
of limiting the sup¬
ply of crude oil have so far been
expenditures,
unevenly distributed
African
Middle
countries
ineffectual.
to
consuming areas.
States presently ac¬
the Free World increased 2.8 mil¬
North
companies. Through increased
earnings, combined with low cap¬
the rate in Australia is 40
Western Europe 15 bar¬
rels,
Japan seven
barrels and
Latin America not quite four bar¬
ever,
are
and
the
barrels,
relation
along this line.
in
completely dominated by the
seven
major international oil
equivalent per year. Canadian
consumption is comparable. How¬
in
have
consumption
will
likely be met by Middle Eastern
of
almost
were
limited
non-competitive levels. Further
increases
Efforts by the Venezuelan Gov¬
ernment and some representatives
three
producing activities outside
years
the
or
the
111
in Western
business
the
oil
entered
Reserves Unevenly Distributed
present
citizen of the United States
utilizes
trial
riodic
addition, since the per capita
consumption in the free foreign
area is only about one-ninth that
of
the United States, the pro¬
spective rate of per capita growth
have
It is likely that indus¬
several years
million.
In
United
companies
Chronicle
recently, sizable
reserves
have been found in North Africa
and other American
companies, as
as
government-owned com¬
panies of consuming nations, have
taken promising
concessions in
well
Trading Markets in:
UNDER WRITERS-DEALERS
HOUSTON NATURAL GAS CORP.
DISTRIBUTORS
common
&
the
Middle
several years
ducers
preferreds
LONGHORN PORTLAND CEMENT
LONE STAR BREWING CO.
SECURITIES
PEARL BREWING COMPANY
THE FRIT0 COMPANY
CENTRAL POWER & LIGHT
specializing in:
HOUSTON LIGHTING & POWER CO.
and other Southwestern Securities
Hart, inc.
Investment Securities
Members Midwest Stock
and Midwest Stock
TWX
Bank
SA-11
&
of
Commerce
pro¬
actively
:•
seeking
reserves
•
:
■
/i
'
w
"
:
;
;■
•
•
.
"
■■
'.
'•
.
i
\
v
r•
;■■
c,...
which
!
to
THE
FIRM
THAT
THE
SOUTHWEST
KNOWS
companies will be forced to share
foreign
demand
growth
with some of the newer partici¬
foreign production.
in
Exchange
San Antonio, Texas
CA 7-6215
71
Furthermore, exports of crude
by the Soviet Union are continu¬
ing to increase to the detriment of
the worldwide price structure but
are
still
relatively unimportant
,<?] EPPLER, GUEfilN & TURNER, INC.
MEMBERS
volumetrically.
Within
ard
Exchange Wire System
Bldg.
these potential
be
>
result in severe competition
at the marketing level and conse¬
quent pressure on prices. Accord¬
ingly,
the
major
international
pants
SAN ANTONIO CORPORATION
&
next
for their
markets
4% preferred
STOCKS
Funk, Hobbs
the
future
4% preferred
ALL SAN ANTONIO AND SOUTH TEXAS
National
will
Over
may
CORPORATE & MUNICIPAL
BANK
East.
■
■
Oil
the
past month
New
of
Jersey
YORK
NEW
STOCK
EXCHANGE
Fidelity Union Tower, Dallas, Texas
Stand¬
began
Phone: Rl 1-3441
shipments of crude from its Zelten field in Libya. It is presently
shipping 60,000 b/d of Libyan
crude for consumption in West¬
Teletype: DL 354-Corp. DL 353-Mun.
INVESTMENT
BANKERS
And early in 1962
being constructed for
Oasis
Oil
Company
(Amerada,
Continental
and
Ohio) will be
ern
Europe.
the pipeline
Initial shipments
completed.
through the latter line will ap¬
proximate 100,000 b/d with 60%
of this for the Oasis group. Within
the past year, Ohio Oil has com¬
pleted
arrangements
with
the
Spanish Government for the con¬
struction of a minority-owned re¬
finery in that country and has
recently announced that a similar
type deal is being negotiated in
West Germany. Also, Continental
Oil has announced the
of
YEARS
h"
ahead
in
and dealers in
Securities
Inc.
•
MEMBERS:
,
New York Stock Exchange
American Stock Exchange
(Assoc.)
Dealers
CORPORATE
AND
to
1961
new
Exchange
Exchange (Assoc.)
is
Alamo National Building
San Antonio 5, Texas-CA 7-2361
MUNICIPAL
highs, and to date
also
somewhat
ahead
SECURITIES
Despite the
entry of Libyan crude to world
markets, further gains in Middle
.Eastern
output are
anticipated
during 1962. Venezuelan output
has failed to show any appreci¬
able gains in the past few years
since
the
imposition of higher
incpme taxes by the government,
-which have forced prices up to
.
New York Stock
American Stock
•
■
of the pervious year.
Houston
Dallas
"
During 1960, production in the
East
once
again forged
Dittmar & Company,
Members
acquisition
Middle
Market
Municipal and Corporate
SAN ANTONIO, TEXAS
201 North St. Mary's St.
Distributors
Production Controls Thwarted
ill tlie
San Antonio
•
I§ntz,^ewton&(]o.
marketing companies in West
■
Underwriters, distributors
Underwriters
Germany and Great Britain.
EXPERIENCE
Texas Securities
•
Vv--:
•
•
V,
-
TELETYPES
Corporate: SA 45
Municipal: SA 63
Gregory 8C Sons Private Wire System
VICTORIA BRANCH
114 E. Constitution
St., HILLcrest 5-1469
112
Belmont
The Commercial and Financial
Tcwbin, C. E. Unterberg, Towbin eft Co., New York; Col. Oliver J. Troster, Troster, Singer
eft Co., New
Ycrk; Mr. & Mrs. Aaron Katz, Troster, Singer eft Co., New York
Mr.
&
Chronicle
.
.
.
Thursday, December 28, 1961
Mrs.
Maurice Meyers, III, Hirsch eft Co., New York; Andrew D. Cornwall, Blair
Incorporated, New York City; Rex Auchincloss, Courts eft Co., New York
eft Co.
»••••
!v-
|
•
I
Mr.
&
Mrs.
Philip
F. McLellan, Massachusetts
Distributors, Boston
Life
Fund
Stanley
McKie, Weil, Roth eft Irving Co., Cincinnati;
O'Brien, W. E. Hutton eft Co., Cincinnati
Mr. & Mrs. Lester H. Empey,
Wells Fargo Bank American Trust Company, San Francisco; Mr. & Mrs.
George Martin, International Bank, New York
Homer J.
O'Connell, Blair eft Co. Incorporated, New York; Mr. & Mrs.
Douglas Hansel, Shields eft Company, New York
Mr. &
Mrs. Aaron R. Eshman, Stern, Frank, Meyer eft
Russell
Fox, Los Angeles;
H.
&
Mrs.
Edward Burns, II,
Co.*
Herman E.
C.
Mr.
&
Mrs.
Donald
Edward
Metzner, Central National Bank, Cleveland;
Kilroy, McDonald eft Company, Cleveland
F. Eberstadt eft Co., New York; Mr. & Mrs. Andrew W. Eberstadt, F. Eberstadt eft
Mr.
Harry
E.
G. Fridley, Fridley eft Frederking, Houston;
Fletcher, William Blair eft Company, Chicago
Earl
T.
Carpenter, McDougal eft Condon, Chicago;
Oscar E. Dooley eft Co., Miami
Charles
J.
Middleton
Rose,
Laird,
Mr.
Bissell
&
eft
Mrs. Robert
Meeds,
New
G.
Gerrish,
York;
Francis B. Bowman, Chase Manhattan Bank, New York
Frenzel, Bankers Trust Company, New York; Ronald M. Coutts, Cruttenden, Podesta eft Co.
Chicago; Joyce Carpenter, Chicago; Paul Frederick, Fahnestock eft Co., New York
j
,%j
4
Volume
194
Number
6120
.
.
The Commercial and Financial Chronicle
.
113
Mr. & Mrs. H. Wilson
New
Arnold, ArnoW <6 Derbes, New Orleans; Malvern
Hill, Malvern Hill & Co., Inc.,
Mr. & Mrs. T. E. Graham, First National
Bank, Ft. Worth, Texas; Mr. & Mrs.
William N. Edwards, William N. Edwards &
Co., Ft. Worth, Texas
York;
lil
Continued from page
Middle
Eastern
competitive
part of the Free World.
in any
Capital
expenditures
for
World
Free
capital
oil
in
petroleum
the
outlays
from
Despite
ities
approximated $10.7 billion in
1960, somewhat less than the $11.1
billion expended in 1959. At the
end of 1960, 55% of the petroleum
industry's gross fixed assets of
refiners
by pipelines running
deepwater terminals which
arq served
facil¬
these
as
served
are
crude
by tankers.
the
oil
larger
produced
volumes
of
refined
and
products sold, profits of the major
international oil companies dur¬
ing 1960
were
little changed from
Mr.
V
considerable effort to
greater
degree
be
anticipated.
have
been
serves
well
as
Oil.
Capital expenditures outside of the
prices
that
United States
since 1955.
at
next
the
abroad.
likely to remain
present levels for
several
years
foreign
newer
in
45%
are
the
about
the
and
producing
couple of
of
com¬
demand
struction
of
requiring the
con¬
refineries
and
new
the expansion of
well
as
the
area,
will
itures
more,
high
the trend
refineries inland
centers
near
involves
Jersey,
have
increased
Texaco,
to
percentage
earnings
of total
as
earnings.
California.
huge
profits
versus
from
of these
initial
the
United
43% in 1957.
of
for
the
refining
as
are
re¬
and
Two illus¬
the purchases
They have also spent
sums
on
internal
growth,
the drilling of favor¬
on
marketing facilities.
OIL
AND
NATURAL
GAS
SECURITIES COMMITTEE
(Standing): Rudolf Smutny, R. W. Pressprich & Co., New York; Salvador Rodri¬
Government Development Bank for Puerto Rico, San Juan; Richard Grimm,
Development Bank for Puerto Rico, New York; Bert Behrens, Lehman
Brothers, New York; Mr. & Mrs. Hal Murphy, Commercial and Financial Chronicle,
New York; Albert Clark, New
York Times, New York; (Seated): Jean Hurdle;
Don Rogers, New York Herald
Tribune, New York; Mrs. Richard Grimm
guez,
Respectfully submitted,
L.
a
Emery
Katzenbach
n,
Government
Chair-
man
In
States
MacDonald,
able properties and the expansion
White, Weld & Co.
New York, N. Y.
1960 this group derived 48% of its
locating
Barrow, Barrow, Leary & Co., Shreveport, La.; Frederick H.
& Co., Kansas City,
Mo.; Mr. & Mrs. Steve Kemp, Jr.,
Abbott, Proctor & Paine, Richmond, Va.
Peet
year of Monterey
Company by Standard Oil of
New Jersey and Standard Oil of
Kentucky
by
Standard
Oil
of
Standard
varying degrees
domestic
O.
during the past
notably
California, Gulf and Socony
Russell
companies
bidders
is
Oil of
consuming
larger
increment
New
Mobil)
that
Further¬
toward
African
the
past' two or three
the United States major in¬
ternationals
(Standard
Oil
of
expend¬
levels.
next
Over
of the
in
capital
keep
at
growth
industry
North
the
over
until at least part
years
years
existing ones, as
rapid
petrochemical
abroad
fitted into world markets.
panies seek to build up their
productive capacity.
Also the
constant growth in Western Euro¬
pean
occurred
likely to continue
the
as
has
Moreover, weakness is
These
marketing properties.
foreign crude and product
located
was
States
H.
purchase of domestic crude oil
tion in
billion
W.
achieving a
integration
of
active
trations of this
United
Mrs.
within the United States and fur¬
ther efforts along this line may
the previous year. This is the re¬
sult of the substantial deteriora¬
$105
&
1
UNDERWRITERS
J.
•
DISTRIBUTORS
DEALERS
•
Raymond Boyce
Managements
Auchincloss, Parker & Redpath
New York, N. Y.
companies have devoted
TEXAS
Bayard Dominick
Dominick & Dominick
New
Underwriters
B.
BDDLEMAN,
•
Municipal Bonds
*
Corporate Securities
York, N. Y.
Dealers
Distributors
Franklin
Houston
Dallas Union Securities Co., Inc.
Members Midwest Stock
Dallas, Tex.
Exchange
TELEPHONE
POLLOK
CApitoI 2-9944
James
&FOSDICK
INCORPORATED
F.
Jacques
First Southwest Co.
TELETYPE
MUNICIPAL
yflHSTON
Dallas, Tex.
HO
HO
INVESTMENT
BANKERS
Edwin L. Kennedy
Lehman
New
Municipal and Corporate Securities
Bank
& Insurance Stocks
1330
Brothers
BANK
395
CORPORATE
OF THE
SOUTHWEST
1191
BLDG.
HOUSTON 2, TEXAS
York, N. Y.
Gilbert H. LaPiere
W. E. Hutton & Co.
938
Bank
of
the
HOUSTON
Teletypes—HO
261
&
Southwest
New
Bldg.
2, TEXAS
Telephone—CApitoI
HO J&67
York, N. Y.
John K. McCausland
4-9221
Dealers
Wood, Gundy & Co., Ltd.
Toronto, Canada
William G. McKnight
Eastman Dillon, Union
ties &
Municipal Bonds
Securi¬
Co,
Corporate Securities
New York, N. Y.
Dealers In
Frederick
L.
★
Moore
★
★
★
Kidder, Peabody & Co.
New York, N. Y.
MUNICIPAL SECURITIES
Edmond
N.
QUIM & CO.
Morse
Members
Smith, Barney & Co.
New York, N. Y.
New
American
York
Stock
Stock
Exchange
Exchange (Associate)
Joseph R. Neuhaus
NUMBER ONE
BURNETT PLAZA
FORT
WORTH, TEXAS
FT 8105
EDison 6-9161
The Bank Wire
THE FIRST
NATIONAL BAN K
FORT
WORTH,
TEXAS
200 Second
Underwood, Neuhaus & Co., Inc.
Houston, Tex.
Edward
Randall in
Rotan, Mosle & Co.
Houston, Tex.
Street, N. W.
Albuquerque, N. Mex.
Denver, Colo.
Farmington,
El Paso, Texas
Santa
Fe,
N.
Gregory & Sons Private Wire System
Myron
F.
National
Ratcliffe
Boulevard
Bank
Chicago, Chicago, 111.
of
N.
Mexico
Mexico
114
Mr. &
Mrs.
The Commercial and Financial Chronicle
Irving Campbell, Bell, Gouinlock & Co., Ltd., Toronto; Mr. & Mrs. Ian Crookston, Nesbitt,
Co., Ltd., Toronto; Mr. & Mrs. Arthur Milner, Mills, Spence <ft Co., Ltd., Toronto
CROOKS,
COOK,
RICHARD
Wm.
CALVIN
Clayton
Securities
CLAYTON,
First
CLONEY,
The
III,
Corp.,
JOHN
National
Bank,
Courts
Dallas
Rambo,
CLUETT,
Company,
The
Close & Kerner, Philadelphia
SCOTT*
Ripley & Co., New York
T.
New
Fidelity-Philadelphia
Philadelphia
Colonial
J.
York
COSTIGAN,
Company,
COUIG,
Distributors,
New
York
T.
Nelson
Freeman
CONDON,
B.
J.
Hayden,
F.
F.
&
New
CRARY,
V.*
J.
Chicago
CULLUM,
ROBERT
Barth
Co.,
New
&
New
York
New
JAMES
CURTIN,
&
&
J.
J.
30
Minneapolis
J.
J.
C.
Hilliard
Calvin
DALY,
DUVAL,
Bullock,
New
York
EARLE,
Lehman
Retail Distributors
J.
Ltd.,
DARBY,
Brothers,
EDWIN
French
Crawford, Inc.
&
Stocks
—
Mutual
A.
G.
Becker
DAVANT,
Paine,
DAVIDS,
The
Spring St., N. W.
Teletype AT 198
First
G.
8626
Blair
&
Curtis,
Los
Angeles
ALBANY, GEORGIA
F.*
A.
Corp.,
Corporation
Cleveland
of
Virginia,
-
3324
DAVIS,
The
Eberstadt
G.
Omaha
A.
York
William
Cullom
Davis
Bankers
DAWSON,
Bond
JOHN
EGGAN,
&
M.
&
Johns
Co.,
New
York
Co.,
Louisville
Co.,
BURTON
Byllesby
New ■York
Wm. P.
&
f
Chicago
E.
&
Chicago
Co.,
E.
York
New
DAVID*
Administration,
Jr.,
HOWARD,*
Stearns & Co., New
York
CHARLES
Singer,
FISHER,
St.
Deane
Wertheim
&
R.
W.
York
Fitzpatrick,
William
S.
Baltimore
Sutro
&
Sullivan
DONALD
Bros.
York
J.
Co.,
DANIEL
Blair
&
&
Chicago
E.*
&
Co.,
New
York
T.
Co.,
Chicago
STEPHEN
Co.,
Denver
Co.,
C.*
WALTER
FLOERSHE1MER,
University,
SHERMAN
&
New
Pressprich
FLETCHER,
Chicago
Pittsburgh
B.*
JOHN
Co.,
FITZGERALD,
Fort Worth
Scribner,
Sullivan
Jr.,
York
N.
&
GEORGE
Bosworth,
Louis
Co.,
New
H.
York
FLOERSHEIMER, WALTER D.
Harper & Son & Co., Seattle
EMERSON, SUMNER B.
Morgan Stanley & Co.,
C.
Co.,
Co..
FITZPATRICK,
MILTON
Hopkins
&
Business
Bear,
New
C.*
New
Toronto
Inc.,
WILLIAM
FITTERER,
Co.,
J.*
FRANCIS
THOMAS
FISHER,
Co.,
M.
&
Chicago
York
Washington
C.*
&
Corporation,
New
Blair
PHIL
Small
Sons,
W.*
W.
Barney
FINNEY,
Edwards
N.
ELLSWORTH,
R.
&
York
Wheeling
BRYCE
Goodbody
FINE,
F.
Boston
Co., New York
RICHARD
EISENHOWER,
&
TYRUS
W.
&
New
PAUL
Boston
Co.,
Jr.,
Smith,
»
EDWARDS, WILLIAM N.*
H.
New
&
i
FEELEY,
Detroit
Atlanta
W.
Co.,
Greenshields
York
New
Corp.,
Davis
Edwards
Estabrook
Co., Denver
SHELBY
CULLOM*
Shelby
Telephone 436
Co.,
E.
Howard,
York
New
Co.,
Co.,
WILLIAM
William
Seattle
Cullom
&
&
&
FRED
FARRILL,
FAY,
CHARLES
KENNETH
York
Co.,
Chas. \y. Scranton & Co., New Haven
FARRELL, F. D.
City National Bank, Kansas City
Houston
EDWARDS, III, BEN F.
NORMAN*
DAVIS,
*
EBERSTADT, ANDREW W.*
Co.,
Cleveland
Co.,
Milwaukee
B.
Howard,
&
First
FARWELL,
&
JOSEPH
EGBERT,
Walston
Co.,
&
Eaton
POWELL
JOSHUA
DAVIS,
Court Ave.
Teletype AX 8335
&
DAVIS, Jr., HERBERT H.
Kirkpatrick-Pettis Company,
DAVIS,
York
Co.,
Co.,
CHARLES
EBBITT,
Shelby
Norfolk
-
I
New
&
&
Masten
Bache
HENRY*
Jr.,
E.
The
L.*
Michigan
D.*
DAVID
ROBERT
FALSEY,
Co.,
&
Bradford
J.
Nuveen
FAIRCHILD,
York
York
F.
&
A.
Chicago
PHARR*
of
EATON,
"
Ryons
Investment
Telephone 525
123
Jackson
CLARENCE
DAVIS,
ATLANTA 3, GEORGIA
C.
Eaton
MARK*
Lester,
Funds
New
&
GORDON
Blyth &
Co.,
John
York
Baird
Mosle
EATON,
W.*
Webber,
DAVIS,
68
&
JAMES
Minneapolis
Bonds
C.
EASTER,
York
New
W.
Sun-Times, Chicago
DARMSTAATER, E. WILLIAM
Stifel, Nicolaus & Co., St. Louis
DATTELBAUM, DAVID N.
N.
NEWMAN
First
Chicago
PAUL
&
Evans
A.
FAIRMAN,
New
EDWIN
Trask
EVERARD,
EWING,
New
Co.,
W.
AtivpIpc
Clement
C.*
Co.,
Devine
DUSON,
Louisville
&
York
EVANS, CLEMENT A.
J.
St.,
Chicago
Co.,
Pershing & Co., New
EUSTIS, BRITTIN C.
New York
& Co.,
San Francisco
STEWART A.
J.
Son,
IRA
&
W.
Co.,
ALLEN
Rotan,
DALENZ, JOHN McG.
Hibbs
SYDNEY
Robert
&
T.nc
Co.,
&
Trust
S.
&
ETHERINGTON,
York
B.
Collins
Spencer
GEORGE
Wertheim
DUFFY,
DUNNE,
Chicago
WATSON*
B.
DuBOID,
Sutro
DEWEY*
&
Washington
DUNN,
Chicago
New
BARNEY
Washington
&
DUGGAN,
W.
Co.,
O.
Fleming-W.
NORBERT
DROBNIS,
Department of the Treasury, Washington
I
DOYLE,
Blyth
&
W.*
Washington
Ferris
FRANCIS
Co.,
Nolan,
DREYFUSS,
J.*
Chicago
CUTLER, PAUL WM.
Chapman & Cutler,
DABNEY,
REGINALD E.
Ferris & Co., Washington
York
New
S.
Becker
DAANE,
E.
Co.,
Simmons,
Cleveland
Co.,
MILTON
EPPLER, WILLIAM B.
Eppler, Guerin & Turner, Dallas
ERGOOD, Jr., RUSSELL M*
Stroud & Co., Philadelphia
ERPF, CARL K.*
Ladenburg, Thalmann & Co., New
ESHMAN, AARON R.*
Stern, Frank, Meyer & Fox,
Greensboro
Buffalo
& Co.,
LESLIE*
Fahnestock
BERNARD
&
Atlanta
Corp.,
J.
ARTHUR
G.
A.
Angeles
CROOKS,
♦Denotes Mr. and Mrs.
Securities
JOHN
CURTIS,
Orleans
New
Moore, Leonard & Lynch, Pittsburgh
York
Co.,
Langley
Kalman
Los
III,
Ellis
ROY
Co.,
Loeb
Folger,
Report. Washington
THOMAS U.
FRANCIS
&
Jr.,
ERNEST
DOUGLAS,
Kidder, Peabody & Co., New York
CUNNINGHAM, KIRKWOOD B.»
Cunningham, Schmertz & Co., Pittsburgh
York
Richmond
Co.,
&
& World
CUNNINGHAM,
C.*
Co.,
C.
Blunt
Co.,
McCall
Crowe,
julien
Orleans
New
Co.,
Moore, Leonard & Lynch, Pittsburgh
DORE, WILLIAM F.
Kuhn,
CUNNINGHAM,
PRICE*
Investment
CREHAN,
A.
&
Louis
H.*
Co.,
News
S.
Interstate
,
St.
York
Corporation,
G.
Parkhurst,
Dallas
Co.,
B.*
Stiver
&
DORBRITZ,
E.*
&
DOERGE, JACK O.*
Doolittle
H.*
Fargo Bank American
San Francisco
EMRICH,
A.
Securities
DOOLITTLE,
Townsend, Crouter &
Philadelphia
CRUMPTON,
M.
Craigle &
Crane
York
Ingen & Co.,
Stone
W.
CRANE,
JAMES
JAMES
U.
Co.,
&
Association,
LESTER
Wells
Association,
Company,
ROBERT
United
CRUIKSHANK, GEORGE
W.
New
DIXON,
E.
CLARENCE
McCall,
York
J.
&
Podesta
ROBERT
Paribas
York
H.
Co.,
New
CRAIGIE, WALTER W.*
RAYMOND
Van
CONLIN,
New
O'Rourke, Inc., Daytona Beach
COLTHUP,
Co.,
&
EMPEY,
STANLEY
Bankers
DINKINS, LADD
Ladd, Dinkins
York
Officers
MRS.
Investment
Saunders,
Horton,
Corp.,
DALTON
&
Cruttenden,
CRAFT,
FRANCIS X.
Dempsey-Tegeler & Co.,
MARION
Jones
COUTTS, RONALD
Inc.,
Chicago
M.
EDWARD
D.
J.
Hirsch
WELLS
COLEMAN,
COLEY,
&
New
Finance
Haven
Thursday, December 28,1961
Washington
LYNN*
HENRY
Bodine,
ANDREW C.
Co., New York
Edward
Trust
De
CORNWALL,
ANTHONY
COGGESHALL,
Corp.,
CROWE,
Company,
DIMASSIS,
M.
Co.,
E.
Municipal
CROUTER,
Management
Hanseatic
M.
Dallas
H.*
EDWARD
York
&
CROSSLEY,
Atlanta
Shares
Illinois
CORLEY,
Blair
New
Cleveland
Chicago
CORBUS, JOSEPH R.*
Boston
W.
COCULO,
Co.,
WILLIAM
CALVIN
Hallgarten
&
Co.,
NORMAN A.
Television
Harriman
COAKLEY, VINCENT
Bear, Stearns & Co.,
J.*
Mericka
&
COOLEY,
PAUL*
L.
J.
COOLEDGE,
Boston
B.
WILL
Keystone
CLOSE,
W.*
RICHARD
Thomson
&
McKinnon, New
York
CROOKSTON, J. IAN*
Nesbitt, Thomson & Co., Toronto
CROSS,
Continued from page 69
CLAYTON,
.
.
Watson Dabney, J. J. B. Hilliard & Sons, Louisville, Ky.; Mr. & Mrs. James R. Hendrix, Hendrix &
Mayes, Inc., Birmingham, Ala.; Mrs. Watson Dabney
Thomson &
In Attendance at Convention
.
Sutro
Bros.
&
Co.,
Palm
Beach
FLYNN,
New
GEORGE T.
Hornblower & Weeks,
York
B.*
New
York
Wood, King, Dawson & Logan, New York
JAMES E.
DAY,
Midwest
DAYTON,
Clark,
UNDERWRITERS
DISTRIBUTORS
DEALERS
DAYTON, Jr., S. GREY
Elkins, Morris, Stokes &
Philadelphia
DEAN,
CORPORATE AND MUNICIPAL
Stock
Exchange,' Chicago
Jr., JOHN W.
Dodge & Co., New York
HOWARD
Harris,
de
Co., New
MARQUETTE*
Smithers
S.
DEGROFF,
Robert
Evans 8c Co.
Eichler
MILHAU,
The
INCORPORATED
E.
Barr
MEMBERS
AUGUSTA
SAVANNAH
H.
DEWAR,
Dewar,
San
New
Angeles
Los
&
&
Bank,
Incorporated
New
Co.,
New
New
Atlanta
York
DIGGS,
Mason
Hagan,
.Bankers
B.
Trust
Pancoast,
Dallas
Teletype—AT 182
GEORGIA
T elephone—523-3692
C.
Inc.,
EDWIN
Savannah
Commerce Building
Pancoast,
ATLANTA 3,
HARRY
Grange
Private Wire Connects All Offices
&
&
La
Coral Gables
York
H.*
Robertson
DIKEMAN,
Columbus
Jacksonville
A.
ROBERT L.
Jr.,
Augusta
York
New
Robertson
American Stock Exchange (Assoc.)
York
L.*
New
Co.,
Exchange
B.*
Co.,
&
Members
York
New York Stock
EUGENE
Co.,
JOHNSON, LANE, SPACE AND CO.
York
Antonio
Dewar,
Corporate Bonds & Stocks & Local Securities
Baltimore
F.
WILLIAM
DEWAR,
DIRECT WIRE TO KIDDER, PEABODY &
CO., NEW YORK
&
Reynolds
TELETYPES: AT 348-349
MACON
Trask
Eldredge
Co.,
EDWARD
DeSTAEBLER,
DEVLIN,
ATLANTA
York
W.
ROBERT
Spencer
New
G.*
Manhattan
deSELDING,
Exchange, Philadelphia-Baltimore Stock Exchange
Inc.,
Brothers
1932
Sons,
&
JOHN
Chase
DERREY,
Georgia and South Carolina Municipal Bonds
York
New
LANE, SPACE CONPONATION
York
C.
Greenshields
de
&
WILLARD
Bateman,
DELAHAY,
MURRAY 8-5185
Co.,
Dealers
RALPH L.
Barrett
DeGROOT,
CLEMENTA.
Midwest Stock
&
dcBRONKART, EUGENE H.
Hill, Darlington & Grimm,
SECURITIES
ESTABLISHED
&
Distributors
THE JOHNSON,
B.
Upham
BARY,
F.
Co.,
Underwriters
Richmond
J.
Company,
New
York
Private. Wire Systems
W. E. Hutton & Co., N. Y. C.-—New York
Hanseatic Corp., N. Y. C.
Volume 194
Mr.
Mrs. G.
&
Number 6120
JOHN JAY*
Eddleman, Pollok & Fosdick,
P. FRED*
FOSDICK,
&
Fox
FOX-MARTIN,
GARVEY, JOHN P.
Houston
Co.,
New
York
The
MILTON*
Hugh W. Long & Co., Elizabeth
HAROLD A.
The Milwaukee Company, Milwaukee
FRANKLIN, HARVEY J.
Merrill Lynch, Pierce, Fenner & Smith
Francisco
San
Inc.,
House
Fahnestock
&
Co.,
Cleveland
Co.,
New
York
THEODORE*
FREELAND,
Securities
American
Corp., New Yox*k
D.*
Salomon Brothers & Hutzler, New York
FRENZEL, HERMAN E.
Bankers
Trust
Company,
New
York
FRICKE, JOHN E.*
Woodcock, Moyer, Fricke & French,
Philadelphia
FRIDLEY, EARL G.*
Fridley & Frederking, Houston
FRIEND, ARTHUR S.*
Folger, Nolan, Fleming-W. B. Hibbs &
Co., Washington
FULKERSON, W. NEAL*
Bankers Trust Company, New York
FULLER, STEPHEN D.*
S. D. Fuller & Co., New York
FULTON, WALLACE H.
FREEMAN,
National
MERRILL
Assn.
Securities
of
Dealers,
Washington
FULTON, W. YOST
Fulton,
Reid
&
GALLIVAN,
Alester
South
JAMES
G.
York
F.
&
Furman
Co.,
Greenville,
Carolina
GARDINER, Jr., JOHN J.*
Irving Lundborg & Co., San
Francisco
GARDINER, ROBERT M.*
Reynolds & Co., New York
JOHN R.
Reinholdt & Gardner, St. Louis
GARDNER,
GARLAND,
CHARLES
Alex. Brown &
Investment Dealers'
GATCHELL,
S.
Sons, Baltimore
PHILIP
Haven
Mr. and Mrs.
New
GENACHTE,
The
PAUL
Chase
GERNER,
B.
Bank,
PHILIP H.*
Bonbright &
New
York
Co.,
Rochester
ROBERT G.
Dooly & Co., Miami
GERTLER, JOHN H.
Barr Brothers & Co., New York
Oscar E.
GIBBONS, Jr., GEORGE B.
Gibbons
B.
&
New York
Co.,
GIBBS, LOUIS A.
Laird, Bissell &
Meeds, New York
GILBERT, JAMES F.
Hornblower & Weeks, New York
GILBREATH, Jr., W. SYDNOR
First of Michigan Corp., Detroit
KEITH
R.
Washington
GLISS, WILLIAM F.
John C. Legg & Co., New York
GLORE, CHARLES F.
Glore, Forgan & Co., Chicago
R.
Johnston,
A.
&
Atlanta
Co.,
E.
Co., Washington
ARTHUR
Lemon
&
HARDY,
Spencer Trask
HALL, GEORGE
Norfolk
HALLIBURTON,
First
HALE,
Montreal
Corp.,
National
Bank,
Worth
Fort
EDWARD
York
Wm.
DENTON
E.
Equitable
C.*
Exchange,
Stock
Rico, New York
GROSSMAN, ARTHUR S.
Straus, Blosser & McDowell,
&
Co.,
York
The
York
New
&
Co..
GUS
York
New
Securities
Nashville
Corp.,
HENRY
Co.,
PAUL
Hanrahan
HANSEL,
&
Co.,
DOUGLAS
Shields
&
Co.,
Jr.,
Kirkland
Jenks,
DAVID
Bache
&
Harris
&
HARRIS,
&
HARVEY,
Alex.
Worcester
C.
Partners,
Jr.,
Brown
York
New
Toronto
Toronto
F.
BARTON*
&
Sons, Baltimore
HASSMAN,
R.*
ELMER G.
& Co., Chicago
Jr., GILBERT*
& Sanford, New Orleans
Becker
G.
A.
York
Hattier
Bankers
Partners,
WILLIAM
Harris
Montreal
B.*
New
S*
Co., ^Chicago
HARRIS, M. CHESTER*
Henry Harris & Sons,
HARRIS, WILLIAM B.*
MURRAY
Investment
Baltimore
G.*
Boston
EDWARD K.
Company, Chicago
Illinois
HATTIER,
HANSON,
Boyce,
Burr,
HARRINGTON, FULLER A.*
Harrington & Co., Jackson
York
New
HANNAFORD, J. D.
Greenshields
Inc.,
IIANRAHAN,
&
HARRIS,
R.
&
Co.,
HAMILTON, ROBERT E.*
&
S.
&
WILLIAM
G.
Sulzberger,
Philadelphia
Laidlaw
JOHN
Bros.
Coffin
W.*
Hallowell,
New
Stein
HARDING,
D.*
Pollock
HALLO WELL,
GRAY, WILLIAM S.*
\Vm. J. Mericka & Co., Cleveland
GREEFF, ERNEST T.*
Granbery,0 Marache & Co., New York
GREEN, J. BRADLEY*
Morgan Guaranty Trust Co., New York
GREENOUGH, PETER B.*
The
Boston Globe, Boston
GREGORY, GEORGE M.
Gregory & Sons, New York
GREGORY, ROBERT H.
Gregory & Sons, New York
GREGORY, III, WILLIAM H.
Gregory & Sons, New York
GRIBBEL, II, John
Elkins, Morris, Stokes & Co.,
Philadelphia
GRIGGS, ALEXANDER M.*
Common, Dann & Co., Buffalo
GRIMM, RICHARD W.*
Government Development Bank for
Association,
Continued
Washington
on
page
We Cover The Southeast!
Puerto
GRUNEBAUM, KURT H.*
New
York Hanseatic Corp.,
GEORGE
GRUNER,
John
Nuveen
GUASTELLA,
The
Bond
GUERNSEY,
Van
J.
HAACK,
Robert
Louis
ELLIS
Evans
Jr.,
Angeles
Los
GLYNN, Jr., JOSEPH A.*
Blewer, Glynn & Co., St.
Clement
Jr., HARVEY B.*
Johnston, Lemon & Co., Washington
C. WILEY
Investment Corporation of Virginia,
HALL,
GRANDY,
B.
GLOVER, W. WAYNE*
United California Bank,
GODSHALL,
GRAM,
New
GERRISH,
Geo.
HARDIN,
GRAY,
F.*
Manhattan
Jr.,
George D.
Duval, J. C. Bradford & Co., New York; Mr. & Mrs. W. L. Lyons, Jr., W. L. Lyons & Co.
Louisville; James A. Russell, Van Alstyne, Noel & Co., New York
GRANT, Jr., HUNTER B.*
Coffin & Burr, New York
York
P.
& Townsend,
Crouter &
Bodine, Philadelphia
GEBHART, CARL, U.
Mitchum, Jones & Templeton,
Los Angeles
GEDDES, EUGENE M,
Clark, Dodge & Co., New York
GOODWIN,
♦Denotes
Association, Toronto
B.
EDWARD
E.*
Vance, Sanders & Co., Boston
HALEY, DAVID A.*
Harkness & Hill, Boston
The
EARLE
Stone & Co.,
Hayden,
Gordon
GORDON, ALAN*
Royal Securities
GRAHAM, T. E.*
York
H.
Ohio
GILMORE,
GAERSTE, JOHN L.
Cooley & Co., New
New
Kalman & Co., Minneapolis
GIRMSCHEID, Jr., ROBERT A.
Investment
Bankers
Association,
Cleveland
Co.,
Co.,
Company, Columbus
GASKELL, THEODORE A.
Hayden, Miller & Co., Cleveland
GASSARD, HARRY L.
De
L.
PAUL
&
&
HOWARD
GAUGHAN,
WILLIAM
FREDERICK,
McDonnell
GASAWAY,
FRANKE,
FRAZIER,
Curtiss,
The Commercial and Financial Chronicle
.
Crane, Crane Investment Co., New Orleans; Leopold Adler, II, Varnedoe,
Savannah, Ga.; R. Ellis Godshall, Clement A. Evans & Co., Inc., Atlanta
FOX,
F.
.
Price
Chisholm & Co.,
P.
.
&
Chicago
New
Check with
New
Co.,
us on
York
Southern and General Market
J.
York
ARTHUR
New
Buyer,
Ingen
Securities
York
T.*
DAVID
&
Co.,
New
York
ROBERT W.*
W.
Baird
&
Co.,
Milwaukee
III, JOHN C.*
Mason-Hagan, Inc., Richmond
HAGAN,
HAGUE, ROBERT F.
Faulkner,
Dawkins
New
&
Sullivan,
Established 192S
York
Members New York Stock
Exchange and
Other National Exchanges
NEW YORK,
ATLANTA, GA
LD-159
Specializing in GEORGIA,
BO
AT-187
Wire
9-9227
N. Y.
NY
1-2370
System extends to New York and Principal
Southern Cities
ALABAMA, FLORIDA,
N.
CAROLINA, S. CAROLINA
General Market
Municipals
and
jDistributors And Underwriters
Trust
TRUST COMPANY
OF
Investment Securities Since
Company
l8<p/j.
GEORGIA
of
Georgia
Banking Since 1891
MEMBER
ATLANTA
JAckson 2-6000
The Robinson
TWX AT-283
'
i
HAnover 2-1561
•
TWX NY 1-2712
Private Wire Atlanta-New York
Humphrey Company, Inc.
RHODES-RAVERTY BUILDING
FDIC
ATLANTA
JACKSON
NEW YORK, 1 Chase Manhattan Plaza
-
2,
GEORGIA
LONG
1-0316
Bell
Teletype AT 288
*
DISTANCE 421
116
•
Chronicle
The Commercial and Financial
116
.
.
.
Thursday, December 28, 1961
if
%
%
Y;"
Ji§.
X
:
■
I*'
i',
fj
;i-.l
Mr. &
Mrs. Leslie P. Lagoni, Parker, Ford &
Mr.
Company, Inc., Dallas
&
Mrs.
Glenn
Cruttenden, Podesta &
Miller,
Mr. & Mrs. John J.
Co., Chicago
|r.<
Kenny, J. J. Kenny Co., New York
•'
■
Continued from page
HAUPTFLEISCH,
LOUIS
Sachs
Goldman,
&
ALFRED
HAUSER,
Chemical
HENDERSON,
115
T.
A.
New
Co.,
York
New
HERMAN,
Co.,
HARDIN
Harris
Trust
IIAYDEN,
&
HESS,
H.
Savings
DONALD
Bank,
Chicago
Baumgartner, Downing & Co., Baltimore
HAYES, JEROME A.
Chicago Daily News,
MILTON
HAYES,
Witter
Dean
HEFFERN,
The
New
&
Co.,
GORDON
City
York
Hettleman
Chicago
PAUL
Times,
Bank,
New
Trust
York
Hickey
Ball, Burge & Kraus, Cleveland
HEIMERDINGER,
JOHN M.*
Walter, Woody
Cincinnati
&
Vilas
of
&
Co.,
New
York
*
W.*
Georgia,
J.
New
York
K.
Hickey, New York
PAUL
HORTON,
KENNETH
HIGGINS,
HELLER, JAMES M.*
Shearson, Hammill & Co., New York
HENDERSON, STACEY R.
T. C. Henderson & Co., Des Moines
Kinsley
&
Liberty
P.*
HOUSTON,
G.*
Dallas
Bank,
National
Oklahoma
City
HILL, MALVERN
Malvern
.'Denotes Mr. and Mrs.
Hill
&
Co.,
New
NORTH CAROLINA
York
Markets
Appraisals
STATE ami MUNICIPAL BONDS
Statistical
Information
Underwriters
SOUTHERN CORPORATE
New
York
Colket &
Distributors
Philadelphia
Co.,
Securities
Co.,
Dallas
W.*
Ball, Burge & Kraus,
Cleveland
HUGHES, ALBERT R.*
Lord,
Abbett & Co.,
New York
FRED
HUGHES, ARTER F.*
Branch, Cabell & Co., Richmond
WILLIAM S.
Wagenseller & Durst, Los Angeles
HUGHES,
MILTON
&
&
Co..
EMERY
&
Co.,
KELLY,
Carl
EDWARD
M.
&
A.
B.
Lord,
C.
J.
&
Devine
Hentz
KENNY,
J.
J.
&
Co.,
Lima
JOHN
Kenny
Carolina Securities
Corporation
S.
C.
Chicago
New
Co.,
JAMES
Moody,
Colonial
Allentown
Paul
B.*
New
Fuller
&
St.
Co.,
New
&
York
Redpath,
York
JOHN
T.
Land
Banks,
New
KOCUREK, ARNOLD J*
Rauscher, Pierce & Co.,
York
Louis
H.
San
York
Antonio
Underwriting—Trading
Corporate & Municipal Securities
JEROME
Jr.,
Insurance
Distributors
Dealers
Corporation, New York
GERALD
HURLEY,
Brothers
Barr
Ristine
P.
Invttlmtnft Sine* 1922
L.
New
Co.,
&
McDaniel Lewis &
York
LOCAL
HINDON
Stieglitz, New York
I JAMS, MAITLAND T.
W.
C. Langley & Co., New York
ILLOWAY, LAWRENCE B.
Penington, Colket & Co., Philadelphia
INGALLS, Jr., ROSCOE C.*
Ingalls & Snyder, New York
JACKSON, Jr., W. C.»
First Southwest Company, Dallas
\j
JACOBS, ALGER J.*
Crocker-Anglo National Bank,
San
Francis V
j,.,
Southwest
Company,
fi
TENN.
Memphis
A K IS
.
Firm Bids
,
'>«
,>
'
Distributors
Firm
Cincinnati
P.
Glore, Forgan & Co., Chicago
JARDINE, Jr., J. EARLE*
William R. Staats & Co., Los
JENNETT, EDWARD J.
A.
G. Becker & Co., Chicago
i«i«[
Co.,
JAMIESON,
JAMES
Dealers
Quotations
.
Angeles
United States
Government Securities
General Market
T.*
Space & Co., Savannah
JOHNSON, EDWARD F. *
Van Alstyne, Noel & Co., New York
JOHNSON, JOSEPH T.
ALESTER G. FURMAN CO.
ESTABLISHED
CAROLINA
1888
NATIONAL
BANK
BUILDlKlG
'•
GREENVILLE, S. C.
Columbia, S. C.
Anderson, S. C.
CEdor 2-5661
Members Midwest Stock
Direct Wire to New York—Eastmon
Exchange
Dillon, Union Securities & Co.
Lane,
Johnson,
The
Municipals
DAVID
JOHNSON,
•
Offerings
Dallas
ROBERT A.*
JAMESON,
&
.
...
,
iMlISillMIIHIli®!
Co.,
JACQUES, JAMES F.*
Pohl
274.1551
GN 86
Underwriters
xARRY A.
New York
JACOBUS, MELVIN S.
Shaw, Hooker & Co., San Francisco
First
.
TELETYPE
Jr.,
&
BUILDING
GREENSBORO, NORTH CAROLINA
&
Bache
SOUTHERN TEXTILE SECURITIES
JEFFERSON
Philadelphia
Co.,
&
Co.
MEMBER MIDWEST STOCK EXCHANGE
J.
JACOBS,
SOUTH CAROLINA MUNICIPALS *
Uf titties
—
DAVID W.*
McKelvy & Co., Pittsburgh
Halle
40 Wall Street, New York 5, N.Y.
Banks
Boston
F.
The First Boston
F.
N. C.
—
C.
HUNTER,
HYDE,
Company,
Milwaukee
%
Milwaukee
H.*
McDanlel Lewis & Co., Greensboro
JOHNSON, ROBERT C.*
Kidder, Peabody & Co., New York
JOHNSON, THOMAS M.*
Johnson, Lane, Space & Co., Savannah
JOHNSON, WALLACE D.
David A. Noyes & Co., Chicago
MARSHALL
JOHNSON,
THE
First National Bank
OF
MEMPHIS
JOHNSTON, ROBERT B.
First
Bank,
National
jdNES,
EDWARD
Edward
Co.,
Bank,
PEYTON
Federal
NORTH CAROLINA
Pittsburgh
Distributors,., Inc.,
DAVID
HUNT,
Members Midwest Stock Exchange
INSURANCE BUILDING, RALEIGH,
ill
Orleans
&
St.
GEORGE
National
D.
New
York
York
WILLIAM L.
Baker, Slmonds & Co., Detroit
HUTCHINSON, FRANK B.
Hutchinson, Shockey & Co., Chicago
HUTTLINGER, KURT J.
Sew/ty
SOUTH
York
New
E.*
KNOOP, A. PETER
Auchincloss,
Parker
KNOX,
New
HURLEY,
Underwriters
&
York
W.
KNIGHT,
J.*
Co.,
Durham
New
KNIGHT, NEWELL S.*
T.*
Co.,
Co.,
Dominick,
Philadelphia National Bank, Philadelphia
KENNEDY, WALTER V.
H.
'
Corporation,
JAMES M.
&
&
KNEASS,
Richmond
A.
Co.,
Pittsburgh
Bldg., Charlotte, N.C.
Warren
First
&
York
H.*
Hutton
F.
Juran
Paine,
&
FRANK
New
J.
Cleveland
Co.,
ROBERT
KLINGEL,
W.*
Jr., ARTHUR F.*
Applegate & Humphrey,
HUNSAKER,
206 Johnston
York
New
Banker, New York
Abbett
York
Corp.,
KINTZEL, HARRY E.*
JOHN
KENNEDY, DANIEL
KENNEDY,
New
HUMPHREY,
Hulme,
^3-nvestmmts for
E.
Co., Boston
Kemper
KENDALL,
Co.,
KINGSTON, Jr., WALTER D.
York
T.*
Jr., G. S.*
Abbott, Proctor &
Jr.,
&
Securities
KEMP,
KEMPER,
i:
Dillon, Union Securities & Co.,
Dominick
J.
WILLIAM
Estabrook
&
Jr.,
First
Chicago
Loeb, Rhoades & Co.,
KEMBLE,
.
E.
CHARLES
KINGSBURY,
G.*
Renshaw,
►
York
New
Hanseatic
JOSEPH
KING,
York
New
I
York
New
York
New
L.
G.*
MacGregor,
&
Glover
C.
American
Piper, Jaffray & Hopwood, Minneapolis
HOWARD, GEORGE H.
Harris, Upham & Co., New -York
HOWARD, KENNETH J.*
J. A.
Hogle & Co., New York
HOYT, JOHN C.*
Sutro & Co., San Francisco
HUDSON,
KILROY,
Eastman
Weld
Rodman
John
F.
EDWARD*
HOWARD, C.
HULME,
STOCKS and BONDS
B.
Union
White,
Hutton
York
New
KING,
Chicago
News,
Singer
KAUFMAN,
E.
York
New
D.*
Co.,
ERNEST
McDonald
KELLOGG, III, JAMES C.*
Spear, Leeds & Kellogg, New
ARTHUR
Penington,
Worcester
Adams,
TOM
IIILBORNE.
Inc.,
Stone & Co., New York
WILLIAM U.
& Co., Baltimore
HORNING, BERT H.
Dempsey-Tegeler & Co., St. Louis
Jr.,
Miller
Daily
KATZENBACH,
S.
Hayden,
Mead,
Chicago
Troster,
\
HOOPER,
W.
Co.,
KIEPER, HENRY R.
Cleveland
Miller,
KATZ, AARON
IIOLMYARD, HAROLD R.
Chicago
Co.,
Detroit
Co.,
JENTRY S.
Bankers
Association,
Washington
&
KANDLIK, EDWARD A.
Chicago
Hoban,
Distributors,
Investment
Mellen
KEUSCH,
&
'■
A.
&
WILLIAM
Wertheim
Jr., ABNER*
Banco. Popular de Puerto Rico, San Juan
MRS.
HOLMES,
MATTHEW
III,
HICKEY,
Heimerdinger,
Colonial
&
&
WILLIAM
HODDE,
L.*
WILLIAM
&
York
Philadelphia
Sherrerd,
KALISCH,
F.*
EDWARD
McMahon
P.
Hollywood
T. NORRIS
MacArthur &
Kenower,
New
of
Hutton
F.
KERR,
Chicago,
Joseph,
Bank
E.
York
Co.,
New
RICHARD W.
Jones & Templeton,
Los Angeles
JOSEPH, HERMAN B.*
M.
KENNETH
KERR,
E.*
&
Mitchum,
York
IIOBAN,
GRAHAM
Burnham
JONES,
York
New
Sun-Tattler,
National
HITCHMAN,
W.
Company
IIICKEY,
HEGAMASTER, DONALD C.
Co.,
duPont
I.
IIIBBERD,
York
Louisville
Son,
E.
PHILIP
New
New
York
New
CHARLES
Francis
Cleveland
Co.,
THOMAS
&
&
HEWITT,
E.
Co.,
JAMES
Butcher
Chicago
&
PHILLIP
&
HETTLEMAN,
Bank,
HEWARD,
National
HEFFERNAN,
Hettleman
K.
EDDE
Rothschild
Co.,
TOM
First
Philadelphia
&
S.*
&
Hollywood
HISS,
P.*
WALTER
F.
JOHN
Wertheim
HINDS,
Remington,
W.'
&
Hilliard
B.
J.
IIILSON,
S.
New York
Co.,
HETTLEMAN,
Chicago
J.
National
American
HAYS,
L.
&
Grant
HESS,
W.
Moines
Des
Birmingham
Mayes,
ARLEIGH
Hess,
Co.,
R.*
J.
JONES,
HENNING*
H1LLIARD,
KENNETH
Walston
York
New
HA WES,
&
C.
&
JAMES
Hendrix
Trust
THEODORE
Henderson
HENDRIX,
York
H.*
Bank
C.
JONES,
Cooley
D.
Chicago
TELETYPES ME-283
D.
Jones
&
Co.,
GRAHAM*
&
Co.,
Hartford
St.
Louis
•
ME-284
TELEPHONE JAckson 5-8S21
WIRE SYSTEM —THE BANK
WIRE
|
%
Volume 194
Number 6120
.
.
The Commercial and
Financial Chronicle
.
117
Francis
Cunningham,
Kidder, Peabody & Co., New
York; Mrs. George Wendt,
Gibbs, Laird, Bissell & Meeds, New
York; George Wendt, First National BankChicago;
Louis
A.
Mr.
of CTiic
icago
KOERNER,
Allen
IRVING
&
ROLLS,
Co.,
New
MRS.
Investment
LAMBING, Jr., MALCOLM E.
Thomas & Co.,
Pittsburgh
York
MARGARET
Bankers
E.
LANDSTREET, III,
Association,
Clark,
Landstreet
Nashville
Washington
KRAUSE, JOHN
Reinholdt
KROHN,
Ira
&
Gardner,
LEWIS
Haupt
&
LANFORD, LOUIS
St. Louis
Hill,
M.*
Co.,
New
W.
H.
Morton
JOHN
Prescott
Du
&
Co.,
New
KULP,
A.
New
First
York
Inc.,
E.
Philadelphia
F.
Dallas
LAY,
•Denotes Mr. and Mrs.
The
Morgan
New
Kirkpatrick,
Little
Rock
Limited,
Montreal
J.
Bank,
New
York
Valley
LEE,
Fenner
&
&
Co.,
&
Co.,
JOSEPH
E.*
Kansas
City
Denver
Co.,
Company,
h.
Co.,
National
E.
New
The
Atlanta
First
Bank,
&
Co.,
Cleveland
Johnston,
DEALERS
Merrill
Inc.,
L.
Mississippi
Peet
&
Co.,
F.
Murch
York
A.
&
San
Antonio
Fenner
Central Louisiana
Electric
General Flooring Co.
Hausman Steel
DISTRIBUTORS
&
LOUISIANA MUNICIPALS
The
Smith
Nat'l
Co.,
Jr.,
B.
New
JAMES
Becker
New
York
l/l/e
Specialize in
LOUISIANA
York
P.
&
MILTON
Co.,
York
New
F.*
Trust
Company,
MUNICIPAL BONDS
Chicago
Barrow, Leary & Co.
~
Association,
LOCKETT, JOSEPH F.*
Townsend, Dabney & Tyson,
LOEWI, J. VICTOR*
Investment Securities Since 1934
Boston
515 Market Street
Teletypes SH-82 &
Co.
Bank of Commerce
Southern
Tidewater
NEW ORLEANS BANK STOCKS
&
CO.
and
GREGORY
Stock
Times
Picayune Pub. Co.
Whitney National Bank
V.
Bear,
New
•
E.
F.
York
New
&
Co.,
&
San
MARK
A.
Hutton
&
Curtis,
IKE D. SCHARFF
JAMES E. RODDY
JOHN J. ZOLLINGER, JR.
Francisco
LOUISIANA
LOCAL
BANK
Co.,
LUND, ANTHON H.
Amott, Baker & Co.,
LYNN,
Lyons
CHARLES
&
Co,,
Kansas
CORPORATE
City
STOCKS
York
New
ISSUES
E.
Chicago
Leonard
LEWIS
Allen
LYONS,
La.
1
W.
Bank,
Pittsburgh
Dallas
&
Co.,
New
York
ScharPP L Jones
KEVIN T.
& Shafto, Boston
&
Co.,
L.
New
INCORPORATED
C.
York
TELETYPE
B.
NO
Podesta
&
Co.,
180
&
W. L.*
Lyons & Co.,
Pitfield
181
&
Co.,
York
MacCALLAN, W. D.
Adamex
Securities
Corp.,
L. D. 235
.
524-0161
SHREVEPORT,
F.*
New
CARONDELET ST.
NEW ORLEANS
12, LA.
Louisville
ARCHIE
140
Chicago
Jr.,
MacALLASTER,
W.
NO 38 (Municipal)
Lynch,
EUGENE
LYONS, SAM
Gruttenden,
2T11
&
F.*
National
LYONS, LAURENCE
COMPANY^
Orleans,
TELETYPES NO 36* (Corporate)
Co.,
York
Mercantile
TUIane
&
York
Moore,
—
York
York
Lubetkin, Regan & Kennedy, New York
LUBY, JOSEPH M.
Paine, Webber, Jackson & Curtis,
LYNE,
a^nvedtnen.t <~>ecuutu3
St.
New
New
LYNCH, Jr., CHARLES McK.
Moore, Leonard & Lynch, Pittsburgh
LYNCH, III, THOMAS*
Howard, Weil, Labouisse, Friedrich;;
Carondelet
3-2573
LUBETKIN, LLOYD E.
Lubetkin, Regan & Kennedy, New York
LUBETKIN, PHIL C.
LYONS,
!11
Co.,
&
Stearns
Wertheim
AND
&
LOWELL, Jr., JAMES R.*
Paine,
Webber, Jackson
McCormick
SONS
(Associate)
Phone 42
STUART
Co.,
THEODORE*
LUNDFELT,
&
Exchange
Exchange
LOW,
J.
Hutton
LUCAS,
Marine
MEMBERS
New York Stock
American
F.
New
Industries
PRIVATE WIRE SYSTEMS
PERSHING
SH-83
SHREVEPORT, LOUISIANA
NELSON
Eberstadt
Schwabacher
Ocean Drilling & Explor. Co.
Southdown, Inc.
CORPORATE SECURITIES
Teletypes NO 189 A NO 190
Chicago
Cleveland
Jacquelin,
GEORGE
Northern
New
Kalvar
Corp.
Mississippi Shipping
Building
LOWREY, CHARLES
Hibernia Nat'l Bank
Jahncke Service
& CO.
NEW ORLEANS 12, LA.
Long Distance 345 & 389
Co.,
ALDEN H.*
Investment
Bankers
E.
Hydratane Gas
Assets, Inc.
MnntrP.il
Montreal
page 118
Washington
LITTLE,
F.
MARKETS
Co
Co.,
on
INC.
J.
WALTER
R.
G.
LOUD,
FIRM
&
&
W.*
Co.,
&
LOVEJOY,
Blossman
weir
Continued
NEWMAN, BROWN
Loewi &
Co., Milwaukee
LOKAY, JOHN M.
Shearson, Hammill & Co., New York
Canal
C.
Weir
York
A.
G.
Becker
&
Co., New York
LICKLE, WILLIAM
Laird, Bissell & Meeds, New York
LINDMAN, RAY H.
O'Melveny & Myers, Los Angeles
LITTEN, CHAPIN
DEALERS
young,
Cleveland
Hollywood
—
GEORGE
Youne
city
321 Hibernia Bank
Pierce,
ROY
&
LEWIS,
UNDERWRITERS
'd,
and OTHER SOUTHERN MUNICIPALS
York
&
Blyth
LEWIS,
New Orleans
McLeod
Murphy,
Investment Bankers
Co.,
RICHARD
LEVERING,
Municipal Bonds
SANFORD
MacDONALD,
Hal
First of Iowa
Corporation, Des Moines
LESTER, Jr., B. P.*
Lester, Ryons & Co., Los Angeles
LEUSTIG, FRED F.
LeVIND,
&
York
Mrs.
LOUISIANA, MISSISSIPPI, ALABAMA, GEORGIA,
TENNESSEE, SOUTH CAROLINA, NORTH CAROLINA
Phoenix
Corp.,
&
Rothschild
Carlisle
HATTIER
New
H.
Kansas
L.
Lynch,
New
LERICHE,
and
Corp.,
FREDERICK
H.*
Lemon
LEONARD,
Specializing in Louisiana
B.
Securities
York
New
Lentz, Newton & Co.,
LENZ, WINTHROP C.*
•
o.
J.*
Hutton
LEMON, JAMES
DISTRIBUTORS
IRA
New York; Mr. &
Chronicle, New York
R.
LENTZ, LESLIE
•
Equitable
MacDONALD,
LEITH, Jr., R. WILLIS*
Burgess & Leith, Boston
LEMKAU, HUDSON B.
Morgan Stanley & Co., New
UNDERWRITERS
Otis, The Bond Buyer,
Commercial & Financial
LEEDY, Jr., LOOMIS -C.
Leedy, Wheeler & Alleman, Orlando
LEEMING, CHARLES E.
Chicago Tribune, New York
LEES, LEON*
Ira
Haupt & Co., New York
LEGROS, EDGAR E.*
F.*
Robinson-Humphrey
Barron
MacCULLEY,
Trust
E.*
&
Q.
JAMES
W.
Smith
JOHN
Hutton
White
Mrs.
Equitable Securities Corp., Nashville
LEE, Jr., CHARLES C.
White, Weld & Co., New York
LEE, E. S.*
H.*
City
D.
LEDYARD,
Lanford,
F.
Guaranty
York
LEAF, HAROLD
R.
&
LAWRENCE, DAVID
Boettcher
LEACH, RALPH
W.
A.
Canada
National
LATSHAW,
Company,
LAGONI, LESLIE P.*
Parker, Ford & Co.,
of
&
LATOUR, WALLACE C.
Merrill Lynch, Pierce,
Inc., New York
MOYER*
Wellington
Pont
LARKIN, JOHN
York
A.
&
Co., Cleveland
KRUSEN, H. STANLEY
Shearson, Hammill & Co.,
Crawford
LANK, HERBERT
York
KRUMM, ROBERT R.*
KRUSE,
BEVERLY
&
New
York
LA.
BATON ROUGE, LA.
JACKSON, MISS.
LAFAYETTE, LA.
118
Jim
Jacques,
First
Southwest
Commercial
Mr.
& Mrs. Milton
Bullard
&
&
Reilly,
Company, Dallas;
Vincent
Chronicle, New York
Laurence
Financial
Fox-Martin, Hugh W. Long & Co., Inc., Elizabeth, N. J.; Richard A. Smith, Filor,
Smyth, New York; Wilson A. Britten, Calvin Bullock, Ltd., New York
Mr.
&
DONALD
Dominick
&
MACKLIN,
INCORPORATED
GORDON
McDonald
MACY,
McCORMICK,
Co.,
&
Co.,
S.
York
National
Shawmut
MANLEY,
MARCKWALD,
Corporation,
MARCUSSON, P. A.*
Private
BALTIMORE
1, MD.
BA 499
Investment
MARLIN,
Bache
Branch
Office
Bell
to
—
New York and Philadelphia
Grymes
Teletype
—
York
New
Digest, New York
Bank,
Merrill
Lynch,
Massachusetts
C.*
Pierce,
WILLIAM
&
MATHERS,
Established 1800
Teletype: Baltimore 383
LLOYD
Goodbody
MATHEWS,
Life
Fenner
&
Smith,
New
Bank
S.
&
MAY,
ALEX.
BROWN
& SONS
New
RANDALL
Chicago
AND
MAYNARD,
Bache
Municipal and General Market Bonds; Baltimore.*,,,,
and Local Securities.
Commission
JOHN
Hornblower
&
New
York
on
the
Philadelphia-Baltimore,
and American
Stock
Exchanges.
New
Daily
Trust
Company,
Hammill
&
Co..
McCARLEY,
private wires to New York, Washington, and Winston-Sa/em
Baltimore, Towson, Frederick, Washington, New York, Spartanburg,
Easton, Winston-Salem.
Members: New York and
Phila.-Balto.
Exchanges. Members: American Stock Exchange (Associate)
Co.,
DAVID
Loeb
MITCHELL,
Chicago
The
WJe invite
BALTIMORE
Chicago
&
EARLY
First
Toronto
T.*
Co.,
New
York
F.
National
Bank,
Memphis
Ijjour *3nquirieA
A
&
JOHN
Jr.,
Deane
McCORMACK,
Hentz
♦Denotes
SECU
York
B.
Boston
&
Stein Bros.&Boyce
Asheville
Established
Co.,
New
York
6
J.*
W.
&
1853
m.*
john
Abbett
McCONNEL,
H.
C.
Co.,
York
New
McCONCHIE, T. RUSSELL
Peoples
National Bank,
Singer,
Kuhn,
J.
Weeks,
City
NATHAN
J.
McCarthy,
New
Co.,
BENJAMIN
m,
&
McCLOY,
Kansas
Counsel, Milbank, Tweed, Hope &
Hadley, New York;
Member, Board of Directors,
Chase Manhattan Bank, New York
Direct
&
York
E.*
McCANDLESS, JOHN A.*
Vance, Sanders & Co.,
Lord,
MIR ALIA,
Chicago
Richmond
Co.,
MILNER, ARTHUR*
Mills, Spence & Co.,
Chicago
York
HARRY F.
McCarley &
Orders Executed
&
WALTER*
Shearson,
McALPIN,
Bank Stocks
Co.,
Co.,
GORDON*
SANFORD
Allyn
Chicago
Boston
Sun-Times—Chicago
Commerce
DEALERS
C.
&
New
MAYFIELD,
BROKERS
L.
Wheat
MILLER,
Co.,
Podesta
York
Parker
News,
Trust
J.
Co.,
Jr.,
DENNY*
Corporation,
J.
Jr.,
M.
&
R.*
Toronto
MAWDSLEY, LORRIN C.
Van Alstyne, Noel & Co.,
The
Distributors,
York
New
PRESTON
Moseley
MARKHAM,
Wells
York
York
CHARLES
MILLER,
C.
New
GLENN
Cruttenden,
York
McNURLEN,
F.
Co.,
Mullaneyj
J.
Fund
&
MILLER,
A.
Chemical
R. C.*
Trust Company of
Georgia, Atlanta
MATHIS, WALTER N.
Dittmar
&
Co., San Antonio
MAY,
Allen
MILLER,
York
J.
C.
Co.,
&
New
MAURICE
Co., New York
EDWARD
ANDERSON
C.
Chicago
MASSEY, ARNOLD B.*
Mills, Spence & Co.,
T.
Co.,
York
New
Baxter & Co.,
New
MICHELS, HARRY A.
Pittsburgh
Co.,
Cleveland
MAURICE*
New York
&
MEYERS,
Chicago
Cleveland
Co.,
H.
Bank,
Co.,
III,
Hirsch
York
Weil, Roth & Irving Co., Cincinnati
McKINNEY, RICHARD B.
Taylor & Co., Los Angeles
McLEOD,
Robinson-Humphrey Company, Atlanta
MASON, LESTER
Burroughs Clearing House, Detroit
MASON, ROBERT*
ESTN MD 264
New
Co.,
&
MEYER,
B,
Bank,
D.
Trust Company,
Boston
York
New;
JUSTUS
Jr.,
COLEMAN
City
Dickson
&
Jr.,
Hirsch
Chicago
Co.,
Bissell
A.*
&
RUSSELL
National
Laird,
GEORGE
Bache
York
EDWARD
Northern
S.
New
MEYER,
&
Turben
Central
York
Co.,
THOMAS
Merrill,
METZNER,
McLELLAN, PHILIP F.*
Co., New York
GEORGE
L.*
MARTIN,
Bldg., Easton, Md.
R.
York
McKIE, STANLEY
&
International
Jr.,
National
McINTIRE,
K.*
WILLIAM
MARTIN,
Telephones
Dealers'
Boston
MELODY,
New
MEYER,
&
McGUINESS, FRANCIS J.
Chaplin, McGuiness &
Detroit
ANDREW
T.
New
Pressprich
McGOVERN,
The
Bank,
Discount
W.
McGREW,
P.
MILTON A.*
Bennett & Co.,
Manley,
Railroad, Public Utility and Industrial Issues
FRANCIS
III,
&
McGLONE, CARL
Chapman, Howe
First
WILLIAM S.*
Magnus & Co., Cincinnati
Municipal Bonds
PLaza 2-2484 —Bell Teletype:
R.
EDWARD
Exchange,
charles e.*
Co.,
cushman*
McGEE,
Cleveland
New
Greeff, Granbery, Marache & Co., New York;
Johnson, Van Alstyne, Noel & Co., New York
F.
Stock
McDonnell
L.
The First Boston Corporation, New York
MADDEN, WILLIAM W.
MAGOUN,
Telephone:
York
NORMAN
Freeman
FIDELITY BUILDING
American
MAGNUS,
INVESTMENT BANKERS
United States Government and
&
Mrs. Ernest T.
&
Edward
McDonnell,
New
Thursday, December 28, 1961
.
.
A. Gibbs, Laird, Bissell & Meeds, New York; William Lickle,
Meeds, New York; Paul K. Hickey, Vilas & Hickey, New York
D.
Dominick,
.
Louis
Mrs.
Continued from page 117
C. T. Williams & Co.
Mr.
Lyons, Allen & Company, New York; Mr. & Mrs.
Irving Koerner, Allen & Company, New York
MACKEY,
Stock
Chronicle
The Commercial and, Financial
Street, Baltimore 2,
Md.
Telephone, SAratoga 7-8400
Uptown Branch, 6609 Reisterstown Road, Baltimore 15, Md., FLeetwood 8-1940
LOUISVILLE
Charlottesville
Calvert
S.
2,
KY.
CUMBERLAND,
NEW
MD.
YORK
5,
PADUCAH,
N. Y.
EASTON,
KY.
MD.
NASHVILLE,
BRUCE
Scribner,
FRANK
Co.,
Mr. and
Pittsburgh
MEMBERS OF
NEW
YORK
STOCK
EXCHANGE
J.
New
Mrs.
York
and
other
leading exchanges
TENN.
&
Volume
Daniel
C.
194
Number 6120
&
Mitchell,
York
ROBIE L.
Mitchell, Pershing, Shetterly & Mitchell,
MITCHELL,
New
.
The Commercial and Financial
.
Kennedy, Lord, Abbett & Co., Chicago; Alvin H. Berndt,
Lord, Abbett & Co., New York
MITCHELL, JOHN N.*
Caldwell, Marshall, Trimble
New
.
MORGAN,
Blyth &
The
The
Gauntt,
GEORGE
A.*
Investment Company Institute, New York
MOONEY, Jr., URBAN D.
Baxter & Co., New York
MOREHOUSE,
Harriman
J.*
Co., New
&
MORGAN,
EVANS
Manufacturers
New
New
York
Trust
List
New
York
H.
Moulton
EDWARD
MUIR,
Co.,
&
Co.,
Mr. and
Scott
Mrs.
&
Robert
Garrett
York
Los
Angeles
D.
1
San Antonio
Stringfellow,
Richmond
&
The
&
Co.,
HAL
Commercial
Chemical
D.
&
Chronicle,
Ladd
Dinkins
&
Co.,
NARES,
Richardson
Co.,
JOHN
&
PECK,
New
PELIKAN,
John
York
Association,
Hentz
&
Co.,
&
Co.,
JOHN
York
New
PFEFER,
First
J.
W.
H.
Illinois
National
York
PERSHING,
New
York
New
York
New
York
W.*
F.
&
DELMONT
Co.,
H.
Morton
K.*
City Bank,
New
York
N.*
T.
&
New
Co.,
York
WARD*
National
W.*
Co.,
York
New
New
Bank,
Central
Fw
Loeb
National
PHILLIPS,
&
Co.,
Company,
PHILIP, PETER V.
Chicago
New
Beane,
BENJAMIN
Newburger,
Louis
St.
E.
&
WILLIAM
Trust
Co.,
PEYSER, Jr., FREDERICK M.
Hallgarten & Co., New York
York
New
THOMAS
Co., Atlanta
&
Pershing
Irving
Corporation,
MILES
Nuveeh
Continental
Delaware Management Co., Philadelphia
NEUHAUS, JOSEPH R.*
Underwood, Neuhaus & Co., Houston
NEUMARK, ARTHUR J.
ROYAL
Williston
Denver
G.*
&
PETITO, FRANK A.
Morgan Stanley &
F.*
PENDERGRAST,
PERKINS,
Washington
NELSON, W. LINTON*
H.
R.
Christensen,
Petersen
PETERSON,
J.
&
Jr., JOSEPH
G.
PEYSER.
ANDREW
Courts
M.
Bankers
Securities
Clark, Dodge & Co.,
York
New
Sons,
Co.,
Nashville
PETER
G.
James
Trust
CARR
Cumberland
Orleans
New
C.*
York
Joseph
PEVEAR,
PAYNE,
MURPHY, JOSEPH D.
Stifel, Nicolaus & Co., Chicago
MURPHY, LEE F.
MUSSON, JAMES F.
Newburger, Loeb &
Writer
PETERSEN,
York
New
Financial
New
PATTERSON, EDWARD
Allen & Co., New York
York
New
DONALD
Bank
GERALD P.
Peters,
EMIL J.*
First Boston Corporation, New York
PATTERSON,
Cleveland
E.*
PETERS,
Jr.,
PATTBERG,
Sons,
BOYNTON
Murch
Investment
J.
PATRICK, ARTHUR
The Economist,
Miami
Chicago
Baltimore
MUNFORD, III, BEVERLEY B.
Davenport & Co., Richmond
NASH,
JOSEPH
MULDOWNEY,
MULLANEY, PAUL L.
Mullaney, Wells & Co.,
MULLIGAN, RICHARD F.
MURPHY,
Dempsey-Tegeler & Co.,
York
♦Denotes
New
E.*
Brothers, New York
ROALD A.
Publishing Company,
Blue
Francis X. Coleman, Dempsey-Tegtler & Co., Inc., New York; James
H.
Clarke, American National Bank <6 Trust Company, Chicago
Troster, Troster, Singer & Co., New York; Mr. & Mrs.
K. Popper, I. M. Simon & Co., St. Louis
MURCH,
Press,
WALTER
MOWER, Jr., EDWARD B.
Newhard, Cook & Co., St. Louis
York
G.*
Hanover
Chicago
EDWARD
MORTON,
R.
MORGAN, CHARLES F.
Morgan Stanley & Co.,
Company,
MOSELEY, III, FREDERICK S.
P. S. Moseley & Co., Boston
MOULTON, DONALD W.*
EDWARD
Ripley
F.
York
Trust
Associated
MORSE,
Lehman
MOONEY,
New
Northern
MORSE,
&
Co.,
119
Elvin
MORRIS, FRANK E.
Department of the Treasury, Washington
MORRIS, PAT G.*
York
MOHR, Jr., SIDNEY J.
Thornton, Mohr, Parish
Montgomery
WILLIAM
Col. Oliver J.
Chronicle
Bank,
Continued
York
Des
on
Moines
page
NEUWOEHNER, HIRAM
White
&
Co.,
NEWBOLD,
St.
JOHN
Louis
S.*
W. H. Newbold's Son & Co., Philadelphia
LEONARD D.
NEWBORG,
Hallgarten & Co., New York
NEWBURGER, Jr., FRANK L.
Newburger & Co., Philadelphia
1840
Established
Underwriters, distributors
and
dealers
and
municipal securities.
in
;
NEWHARD, HARRY W.*
Newhard, Cook & Co., St. Louis
NEWMAN, Jr., A. JOSEPH
The Philadelphia Bulletin, Philadelphia
NEWMAN, VINCENT*
Channer
Corporate
Newman
Chicago
NEWTON,
Lentz,
Jr.,
G.
FRANK
Newton
NEWTON,
H.
Securities
GEORGE
Walker
R.
Co.,
&
&
Company,
—Members—
New York Stock
American Stock
A.*
St.
Co..
Mead, Miller & Co.
Antonio
San
Exchange
Exchange (Associate)
Philadelphia-Baltimore Stock Exchange
Louis
NICHOLS,
ROBERT GARRETT & SONS
NEW y0rk
One Chase Manhattan Plaza
BALTIMORE
South & Redwood Streets
HAnover 2-6140
MUlberry 5-7600
TELETYPE:
Members:
New York
387
Charlotte
ALLEN
Riter
&
J.
New York
Co.,
NONGARD, RICHARD C.
Nongard, Showers & Murray,
NOONAN,
WILLIAM
Jr.,
Illinois
Continental
Chicago
Charles and Chase Sts.
A.
National
BALTIMORE
Bank,
1, MD.
Chicago
M.*
Edgar M. Norris & Co., Greenville
NORTH, FRANK W.*
Barret, Fitch, North & Co., Kansas City
NOYES, BLANCKE*
NORRIS,
/.'"v; :v
Stock Exchange, American
LEONARD F.
Maritime
Administration,
Washington
NISBET, Jr., W. OLIN*
Interstate Securities Corporation,
NIX,
Stock Exchange (Associate)
Philadelphia-Baltimore Stock Exchange
EDGAR
Hemphill,
Noyes & Co.,
JOSEPH
NUGENT,
Mabon
&
Co.,
Telephones
Baltimore—LExington 9-0210
Bell
New York—WHilehall 34000
Teletype—BA 270
York
New
C.
New
York
HARRY C.
W. E. Hutton & Co.,
O'CONNELL, HOMER J.
O'BRIEN,
LET BAKER, UIRTTS &
CO. BE VOUR CUIDEPOST
FOR PRUDE AT UIUE5TI1IEI1T SERUICES...
Government Bonds
•
U. S.
•
State, County and
Municipal Bonds
•
Public
Authority and
Revenue
•
Listed
Bonds
and
Unlisted
Stocks and Bonds
Blair
&
O'HARA, WALTER T.
Thomson & McKinnon,
O'KEEF, ROBERT
Marshall
The
Active
in
Trading Markets
Local
Bell System
Securities
Teletype— BA395
New York-Call CAnal 6-7162
Representative-Clarksburg ,W .Va
York
New
H.*
Milwaukee
Company,
EDMUND G.
Dillon, Union Securities & Co.,
O'LEARY,
Eastman
SPECIALISTS
York
New
OLLMAN,
H.
CARL
'in
Witter
Dean
& Co.,
Chicago
RODERICK
Byllesby & Co., Chicago
O'NEIL, C.
H.
M.
ORR,
JOHN
The
C.
Wall
Street
Journal,
New
York
O'ROURKE,
T.
Jr., T. NELSON,
Nelson O'Rourke, Inc.,
INSURANCE
Beach
Daytona
•
Cincinnati
New York
Co.,
OSTRANDER, WILLIAM: L.
The First Boston Corporation,
OTIS, C. BARRON*
The Bond Buyer, New York
OTTENS, JUSTIN T.*
Salomon
Brothers
&
Hutzler,
Chicago
New
York
PACKARD, DAVID C.
John
C.
PAIDAR.
Legg
& Co., New
LEONARD J.*
York
Goodbody & Co., Chicago
PARCELLS,
BAKERTWATTS & CO.
Investment
■i
.
Calvert
•
and
Bankers • Established 1900
York Stock Exchange
Philadelphia-Baltimore Stock Exchange
American Stock Exchange (Associate)
Members:
New
Redwood Sts. • MUlberry 5-2600
Charles
Kay,
PARRY,
De
CHARLES
Parcells
Richards
R.
PARKER,
Kay,
Jr.,
A.
NATHAN
PARKER.
&
A.*
Co.,
Detroit
Co.,
& Co.,
SIDNEY
&
JOHN C. LEGG & CO.
K.
Pittsburgh
BALTIMORE / PIKESVILLE / NEW YORK
BURTON
Richards
Coppet
&
Pittsburgh
MEMBERS:
New York Stock
L.*
Doremus,
New
Jr.v JOHN G.
Fidelity-Philadelphia Trust
Philadelphia
York
PARSONS,
Company,
120
v//////////////////////////////////////////////////////////////////////////////////////////////////////////////////.
and other
Leading Exchanges
Exchange
120
John
The Commercial and Financial Chronicle
Krause, Reinholdt & Gardner, St. Louis; F. D. Farrell, City National
Bank, Kansas City. Mo.;
F. Colthup, Freeman & Co., New York; Stewart A.
Dunn, C. J. Devine & Co., New York
Mr.
James
Continued from page 119
PICO,
Puerto
POWELSON,
Leedy,
RAFAEL
DR.
Government
Development
Rico,
Bank
for
York
New
PINKERTON,
J.
Bradford
C.
PLATT,
U.
BLEDSOE
&
CHARLES
S.
News
PODESTA,
Dallas
R.
Co.,
Wm.
MAX
MONROE
POOLE,
Geo.
M.
Simon
First
&
FELIX
PORTER,
National
Jr.,
PORTER,
Television
York
V.*
Co.,
New
York
8c
Co.,
St.
N.
Bank,
PUTNAM,
Louis
JOHN L.
Shares
Management
CARLOS
Banco
Ponce,
Winslow,
Corp.,
POWELL,
Powell,
Cohu
&
E.
RAGGIO,
Ponceno,
F.
New
Co.,
St.
Paul
Securities
&
York
Fay,
San
& Stetson,
ARTHUR
Francisco
Woodard-Elwood- &
Miami
&
Rand
Denver
RANKIN,
Jr., ROBERT J.
Kistler & Co., Fayetteville
Co.,
New
HARLEY
Sachs
Goldman,
- •
Co.,
Minneapolis
THORBURN*
RAND,
M.
H.*
L.*
& Co.,
Distributors
MUNICIPAL and CORPORATE
Bank,
Chicago
C.*
WILLIAM
&
B.
J.
&
CHARLES
Co.,
New York
Bank,
Chicago
R.*
SCHMELZLE,
RICHARD
Fusz-Schmelzle
&
Co.,
New
LEACH
Members
York Stock Exchange
Bank,
American Stock Exchange
(Assoc.)
Weeks,
New
Montgomery, Ala.
Wires Between
Offices
Goldman, Sachs & Co., New York
ARTHUR
R.
National
Bank,
&
&
MRS.
ELINORE
Bankers
Bond
CLAUDE
&
Co.,
LtfUisville
D.*
Financial
Chronicle,
York
ALEX*
State
Jr.,
Bank,
WILLIAM
Williston
8c
Newark
W.
Beane,
New
York
A.*
St.
Louis
New
♦Denotes
Mr. and Mrs.
York
StedfL, founJtty. £r
Company,
TltujwripaL(BomUl.
MIDWEST
York
New
STOCK
EXCHANGE
Providence
CffipffvcdtsL SsavdiisiA,
H.
Co.,
York
New
Dominick,
JAMES
New
York
&
York
New
Company,
INC,
E.
Scharff 8c Jones, New Orleans
RODRIGUEZ, SALVADOR
Government
Puerto
New
San
DONALD
York
ROGERS,
John
Development
Rico,
ROGERS,
Herald
PHILIP
C.
Legg
ROGERS,
Jr.,
for
FIRST NATIONAL BUILDING
-
BIRMINGHAM 3, ALABAMA
FAIRFAX 2-4553-TWX BH 394
Tribune,
York
New
^
O.
&
Baltimore
Co.,
SAMPSON
Hutchinson
McMaster
Bank
Juan
I.*
&
LOUIS J.
Financial World, New
Co.,
Chicago
ROLLAND,
RONAN,
New
SOUTHEASTERN
FRANK
York
Bache
8c
ROSE,
MARKET
New
BONDS
Securities
Bissell
ROSEN,
Cady
9tCompany
INCORPORATED
York
Charlotte
Corp.,
Asiel
8c
&
Co.,
New
Investment
—
Co.,
Telephone FAirfax 8-1370
M.
Business
Week,
New
York
We
G.
Reserve
ROWE, ROBERT
Stroud
&
Bank,
G.*
New
York
Specialize in
Philadelphia
Co.,
RUSSELL R.*
Winston & Co.,
ROWLES,
Rowles,
York
New
J.
ROBERT
Federal
Teletype Cols Miss 365
Columbus, Mississippi
J.*
Merle-Smith,
&
ROUSE,
York
New
Securities
York
SAMUEL H.
New York
ALFRED
Dick
Meeds,
8c
THEODORE
ROSENBERG,
ROSSANT,
Stubbs, Watkins & Lombardo, Inc.
'
MIDDLETON
Laird,
ROSS,
York
New
York
M.
ARTHUR
Burnham
MUNICIPAL
Corp.,
JOHN
Co.,
Interstate
ROSE,
GENERAL
J.
Hanseatic
ROOSEVELT,
York
ROOSEVELT, JULIAN K.*
Dick
&
Merle-Smith, New
AND
Houston
Mississippi Municipal
RUNDLE,
BIRMINGHAM
3, ALABAMA
DONALD G.
Saunders, Stiver & Co., Cleveland
RUSSELL,
Telephone: ALpine 2-3175
Smith,
MEMBER
Schwabacher
RODDY,
R.
&
•
ROBSON, FREMONT W.*
McLeod, Young, Weir, Inc.,
ROCKEFELLER,
Jr.,
AVERY
Dominick
J.
Fenner
York
SELLEW,
Cleveland
Chicago
Co.,-
W.
Lynch, Pierce,
SEIDLER,
Denver
Securities
EDWARD
ROBINSON,
New
Columbus
L.*
JACK
Commercial
Institute,
Richmond
Richmond
ROBERTSON, JAMES M.
Shearson, Hammill & Co.,
Industrial
Louis
A.
Bend
ROBINSON,
SEDER,
The
York
ROBERTSON, DAVIES*
STERNE, AGEE
St.
Cleveland
Investments
SEIBERT,
Miller,
N.
Company,
8c
Stringfellow,
National
&
Trust
C.
York
New
HARRY
HARRY
SEDLEY,
Chicago
H.*
Company
Mellen
ALEXANDER
Jr.,
GEORGE G.
Ohio Company,
Merrill
Co.,
Omaha
Jr., ALBERT E.
Co., San Francisco
Co.,
BUFORD
S.
&
SEBEL,
A.*
&
York
Toledo
Diego
Strudwick,
MALCOLM F.
McGann
York
Angeles
Joseph,
York
New
8c
&
Schapiro
New
M.
Savings
MORRIS
New
L.*
SCULLY,
The
SCHLOSS, PHILIP M.
Baltimore
Manhattan
HARRY
A.
Los
Philadelphia
RITTER, CARL W.
Union-Tribune, San
RIVEL, ROBERT B.
ROBERTS,
8c
&
Schwinn
Selected
Jr., FRANCIS
Whipple & Co.,
SCHIMPFF,
Buffalo
Sons,
Co.,
Chase
Co.,
Harriman
Trust
SHEAFE
J.
&
Philadelphia
E.
ROBERT
Investment
Sherrerd,
&
Bacon,
M.
CREIGHTON*
8c
Jr.,
Marache
Bros.
SCHAPIRO,
H.*
Co.,
WILLIAM
Albert
Direct Private Wire to
Harris
York
Francisco
Hutton
South
Private
Savings
JOHN
Hornblower
Birmingham, Ala.
Brown
B.
Scott
Parke,
GEORGE
SCHALLER,
L,
SCOTT,
&
Inc.,
Co.,
C.
Brothers,
Mercantile
A.
Chicago
X.*"
SCHWINN, LESLIE B.
Orleans
D.
York
New
WILLIAM
Collins
&
Dallas
J.
Roberts
SCHAFER,
Lehman
SCHWEPPE,
SCHANCK,
San
Brown
The
York
O.
&
ALLEN
SCHWARTZ,
York
&
Co..
Schwabacher
C.
New
B.*
Sanford, New
8c
Granbery,
New
N.
G.
York
A.*
SATTERTHWAITE,
STEPHEN C.*
Noyes & Co., New
Co.,
J.
F.
York
Jr.,
Trust
Trubee,
Hattier
Co.,
Jr.,
Schmidt,
W.
Rhoades & Co.,
WILLIAM
&
Share Corporation,
&
8c
JOHN
Chiles-Schutz
New
Bank,
Group,
SCHWABACHER,
Corp.,
ANDREW
JESSE
York
Philadelphia
CHARLES
FRANKIN
Bosworth
SCHUTZ,
Brothers,
Sanders
Corporation,
REYNOLDS,
Harris
II,
SANFORD,
L.*
J.*
Canadian
Lehman
W.
Loeb,
ROBERTS,
—•—
New
Chronicle,
York
New
New
HERBERT
RICE,
Midland
SAPP,
Co.,
Anderson
SECURITIES
York
SAGE,
CHARLES
JOHN
M.
REPP,
RILEY,
Dealers
New
F.
Co.,
8c
FRANK
&
RENNAU,
Alex.
—
Co.,
Financial
JAMES
Butcher
—
&
Indianapolis Bond
E.
&
Braun,
_
Parke,
&
HAROLD
Distributors
York
York
New
Inc., New
GERALD*
G.
New
Corp.,
Co.,
H.
York
A.
Boulevard
SCHROEDER,
&
Ryan,
SANDERS,
Goodbody
RIEPE,
Underwriters
New
Roberts
National
P.*
A.
Barney
JAMES
Park,
VINCENT
RICHARDSON,
1917
Phoenix
GEORGE
Securities
ALLAN
Smith,
York
RICHTER,
Established
Co.,
&
Wiesenberger
REILLY, F.
Birr
Philadelphia
Dominion
RYAN,
E.
Beck
RICHARDSON,
York
Louis
St.
RYLEY,
Hemphill,
Jr.,
Sons,
JOSEPH
Ely,
Discount
THAYER
LOUIS
Co.,
WALTER
RYAN,
&
LEO
Carl
New
Corp.,
Jr.,
8c
REFSNES,
REIF,
Bache
&
Evans
SCHMIDT,
Schmidt,
SCHREDER,
GUY
Indianapolis
RENDIGS, Jr.,
L.
Wood
Louis
SCHMIDT,
York
New
RUTHERFORD,
REILLY,
York
SCOTT*
REDWOOD, Jr., JOHN*1
Baker, Watts & Co., Baltimore
REESE, EUGENE
Newhard, Cook & Co., St. Louis
W.
Edwards
REISSNER,
New
St.
PARIS
Glore, Forgan & Co.,
RUSSELL, RENOUF
SCHOENEBERGER,
G.
New
W.*
Company,
Thursday, December 28, 1961
.
Watkins, Stubbs, Smith & Lombardo, Birmingham, Ala.; Mr. & Mrs.
Wallace Johnson, David A. Noyes & Co., Chicago
RUSSELL,
Cleveland
L.*
Trust
Commercial
York
Doremus,
JOHN
Hooker
RAND,
Co.,
Seattle
Mrs. Miles
.
F.
S.
Moseley & Co., Boston
RUSSELL, STANLEY A.
Blyth & Co., Philadelphia
A.
Arthur
Bank,
RADEMAKER, HENRY A.
IVAN
JAMES
Boettcher
LEO
Harold
Puerto Rico
POUSCHINE,
POWELL,
Ahorro
S.*
Distributors," Boston
&
THOMAS
Mercantile
Refsnes,
York
New
GEORGE*
Fund
Equitable
Y
B.
National
HENRY
Coppet
QUIST,
J.*
Credito
Boston
QUINN, ARTHUR P.*
Quinn & Co., Albuquerque
City
Oklahoma
Charlotte
Company,
Digest,
Jr.,
Putnam
PUTNAM,
Chicago
POU,
Co.,
RUSSELL
Prudden's
De
Co.,
MALCOLM
PRUDDEN,
New
K.*
ELVIN
POPPER,
I.
Gibbons
B.
Curtis,
8c
B.*
TRUXTON
Seattle-First
Co.,
8c
York
New
REDMAN,
&
Trust
PROSSER,
E.*
Pollock
E.
Jr.,
Bankers
I
Philadelphia
POLLOCK,
Co.,
Jackson
MARSOM
&
RANNEY, BRUCE B.*
Ball,
Burge
8c
Kraus,
RAY,
V.
Dickson
PRATT,
Chicago
Bank,
Tradesmens
S.
Estabrook
POLK,
Provident
LOGAN
PRATT,
Washington
A.*
ROBERT
Orlando
Boston
M.
Cruttenden, Podesta 8c
Jr., CHARLES R.
&
Webber,
PRATT,
York
New
Co.,
Alleman,
A.*
ALBERT*
Paine,
C.
World Report,
&
Barney
PRATT,
CHARLES C.*
Rauscher, Pierce & Co.,
J.
8c
ROBERT
Smith,
PIERCE,
RALPH
Wheeler
POWERS,
&
.
Miami
Teletype: BH 287
RUSSELL,
Van
Hayden,
Miami
JAMES A.
Noel &
Alstyne,
RUSSELL,
Bonds
JAMES
Herald,
We
Co.,
KEITH C.
Miller & Co.,
New
York
Cleveland
Request Offerings and Solicit Inquiries
Volume
Number 6120
194
.
.
.
The Commercial and Financial
121
Chronicle
{• :i
& Mrs. Robert Wehrheim, Philadelphia National Bank,
Philadelphia; Frederick T. Seving, Butcher & Sherrerd,
Philadelphia
i
:t:
JOSEPH
SENER,
John
C.
The
Chase
Baltimore
Co.,
C.
Manhattan
Bank,
York
New
SHEEHAN, JAMES L.*
Dick & Merle-Smith,
Yarnall,
SHANKS,
The
C.
CARROLL
Biddle
&
WILLIAM
Bond
SHAPIRO,
ROBERT
F.
Lehman
Brothers,
New
SHAPIRO,
SUMNER
SHERBURNE,
York
&
'*
SHERRILL,
Shields
St. Louis
Woods,
&
SHIELDS,
SHAPLEIGH, II, A. LEE*
Smith, Moore & Co., St. Louis
Shields
Thalmann
Mr.
York
H.
CO.,
&
SLEVIN, JOSEPH R.
New York Herald Tribune,
Company,
Keystone
&
Co.,
W.
MARK A.
Craigie &
LEEDY, WHEELER 6- ALLEMAN
INCORPORATED
One
GArden
Research
W.
C.
HARRY B.
JAMES
E.
T.
WAYNE
Member
M.
STACK, PRATHER
Bankers Trust Company,
New
Underwriters
York
Inc
Exchange
Distributors
STAFFORD, JOHN H.*
Lee
NATIONAL BANK
Dealers
in
Higginson Corporation, New York
Corporate & Municipal Securities
Cleveland
Jr., MASON B.
Allyn & Co., New York
STARRING,
A.
C.
STARRIN, in, MASON B.
JACKSONVILLE
Dominick
Laird
JACKSONVILLE, FLORIDA
_
.
.
New
533
York
SIDNEY A.*
New York
STEARNS, GEORGE R.*
The Economist, Chicago
Oscar
E.
STEELE, E. BLAINE
H. j. Steele & Co.,
Corporation
CLinton
PHILIP M.
Dooly & Co., Miami
STEARNS,
The Bank Wire
Seabreeze
DAYTONA
Co.,
&
fOA_
Organized 190 3
Bell Teletype JK 182
Insurance
Dominick,
&
STAUNTON,
Deposit
Stock
GEORGE R.
First Boston Corporation, Boston
STAPLES, JACK R.
Fulton, Reid & Co.,
Federal
Midwest
Co., Detroit
Watling, Lerchen &
The
Member
Nelson O'Rourke,
Houston
SPEAR,
ATLANTIC
—
MM 293
York
Allyn & Co., Chicago
WALTER M.
SPADE,
Department
Wire System
3-5318
■
Rotan, Mosle & Co.,
Telephone ELgin 5-1711
FRanklin
Bell Teletype
Yarnall, Biddle & Co., Philadelphia
SNYDER,
A.
OF
2-5161
Bldg.
Florida
32,
Corp.,
SORENSEN,
Bond
Ingraham
Miami
Pressprich & Co., New York
SNYDER,
of Federal Agencies
504
f
SMUTNEY, RUDOLF
R.
Orange Ave.
Bell Teletype OR 7010
York
New
North
Orlando, Florida
Richmond
Co.,
SMITH, WALTER J. J.*
National Securities &
Bonds
Washington
SMITH, ROBERT H.
Faulkner, Dawkins & Sullivan, New
Municipal Bonds
1924
Trust Company,
SMITH, RICHARD A.
Filor, Bullard & Smyth, New York
U. S. Government Securities
ESTABLISHED
York
SMITH,
F.
Boulevard
BEACH, FLORIDA
2-5571
Teletype:
DB
80
Pittsburgh
STEFFENS, CHARLES T.
The
First Boston Corporation,
STENSON JAMES
Continental Illinois
±11111111111111111111111111111
P'C-m
New York
National Bank,
York
New
lllllllllllllllllllllllllHli;
'STEPHAN, FRANCIS J.
Vilas & Hickey, New
York
JACK T.
Inc., Little Rock
STEPHENS,
Stephens,
Established 1930
STEPHENS, J. F.
Texas
| Pierce, Carrison, Wulbern,. Inc. |
Management
Fund
Company,
Houston
STEPHENSON,
EDWIN
Corporation,
Paribas
A.
Thirty Years of Experience and Distribution in
York
New
~
Underwriters
•
Distributors
•
^
Dealers
STEVENS, WILLIAM A.
j. C. Wheat & Co., Richmond
STEVENSON, G. C.*
Bacon, Stevenson & Co., New York
STEVENSON, JOHN B.
The
Pierce, Carrison,
Wulbern Corporation
Washington
STUART D.
Trust Company,
STEVENSON,
Bankers
New
CORPORATE
York
STEWART, NORMAN W.*
F. S. Smithers & Co., New York
Main
=
=
STEWART,
Office: JACKSONVILLE
Barnett National Bank
__
ELgin 5-6691 =
Building
Moore,
ROBERT
Leonard .&
STOCKBRIDGE,
Security
Los
TAMPA:
=
BIRMINGHAM:
617
=
~
Madison
Street
,
First National Bank
Tampa 2-4628
5
251-7167
=
Bldg.
Wire Systems to:
Dominick & Dominick and
John C. Legg & Company
ltll
IIMIIIII
Illlllllll
Mil
First National Bank,
DONALD
A.*
Oscar
Morgan Guaranty Trust Company,
New York
WALTER H.
Fidelity Union Trust Co., Newark
STOLLE, CARL
G.
A. Saxton
& Co., New York
STOHL,
jZ
STONE,
r:
STONE, ROBERT W.
III?
COMPANIES
Pittsburgh
FRANKLIN*
e.
Dooly
MIAMI 32,
on page
co
FLA., INGRAHAM BLDG.—PHONE: FR 3-6272
MM
New York
Continued
&
Member, Boston, Philadelphia-Baltimore Stock Exchanges
Jr., FRED. D.»
Marine Trust Company, New York
Federal Reserve Bank,
7111111
and STOCKS
DEVELOPMENT
M.
Lynch,
BONDS
Angeles
STODDARD,
5
SECURITIES
MUNICIPALS
Association,
Bankers
Investment
FLORIDA
York
Hayden, Stone & Co., New
STEVENSON, in, ROBERT
Members New York Stock Exchange
Allyn,
CORPORATE SECURITIES
CHARLES V.
Clark, Dodge & Co., New York
SMITH, JOSEPH E.
Newburger & Co., Philadelphia
SMITH, J. RAYMOND
Weeden & Co., New York
Kansas City
John W.
Orleans;
MUNICIPAL BONDS
SMITH,
Boston
RUSSELL E*
Brothers
Stern
and Mrs.
BUSINESS
SMEAL, FRANK P.
Morgan Guaranty
New
The
New York
Sanford, New
Allyn & Co., Chicago; 'William P. Brown,
Baker, Simonds & Co., Inc., Detroit
F.
CORNELIUS
Co., New York
&
C.
Corp.,
w
Jr.,
H. VIRGIL*
Co., New York
Jr.,
SIEFERT,
♦Denotes
HAROLD
A.
BRADFORD
Hallgarten & Co., New York
SIMPSON, WILLIAM G.*
Simpson, Emery & Co., Pittsburgh
SIPP, Jr., PAUL L.*
Stern, Lauer & Co., New York
SLACK, WILLIAM E.
Bioren & Co., Philadelphia
SHOLLEY, S. L.*
SHAW, LEO G.
Ladenburg,
New
New York
HENRY J.*
& Research
York
SIMPSON,
Bacon, Whipple & Co., New York
"
Heitner
Yates,
New
York
SHEPARD, ROBERT O.
1
Prescott & Co., Cleveland
York
New
New
Jr.,
Securities
National
H.
& Sons,
Gregory
Co.,
SIMONSON,
SHELTON, LOCKETT*
Republic National Bank, Dallas
Philadelphia
Co.,
S.*
Buyer,
JAMES
SHEILS,
&
Weeden
Clark,
Hattier &
Hatt-ier,
WILLIAM E.*
SIMON,
SHAEFFER,
&
SEVING, FREDERICK T.*
Butcher & Sherrerd, Philadelphia
SEWARD,
Seibert,
THEODORE C.
Janney, Battles &. E. W.
Philadelphia
W.
Legg
SENHOLZI, JOHN
Gilbert
Emrich, Julien Collins & Company, Chicago; Claudine
New York; Edward D. McGrew, Northern Trust Company,
Chicago
1
S.
Milton
Mr.
122
373
122
Mr.
&
Mrs.
Mo.;
The Commercial and Financial Chronicle
Russell
Russell
Continued
E.
from
TANKARD,
121
page
Winston
&
Co.,
TAYLOR,
Houston
Dominick
STOUT,
& Dominlck,
CHARLES
Robert
Garrett
STRAUS, FREDERICK W.*
Straus, Blosser & McDowell,
STRONG,
TERRELL,
Crouter & Bodine,
Girard
Philadelphia
STUEBNER, ERWIN A.
Kidder, Peabody & Co., Chicago
SWAGLER, RICHARD C.*
Odess, Martin, Sellers, Doe
Birmingham
SWENEY, LOWRY
Sweney, Cartwright
&
Co.,
SWICK, THEODORE P.
White, Weld & Co., New
SWORD, WILLIAM H.
Morgan
Stanley
SYMINGTON,
G.
H.
&
Jr.,
Walker
&
Co.,
&
Louis
TRESCH,
Trust
Corn
Exchange
Bank
Asiel
TURNER,
THORS, J. EMERSON*
Kuhn, Loeb & Co., New York
Morgan
York
New
Guaranty
Trust
Company,
York
New York
TODD,
York
New
York
Co..
W.
United
New
Robert
W.
York
ROBERT
Herald
Tribune,
New York
Bank,
Los
Angeles
Thursday, December 28, 1961
Barker, Irving Trust Company, New York;
Gertler, Barr Brothers & Co., New York
F.*
WILLIAMS,
&
S.
Washington
Dain
M.
Co..
&
Hannaford & Talbot, San Francisco
WILSON,
&
Second
Minneapolis
Stein
Boyce, Baltimore
Bros.
HENRY
Hornblower
&
Seattle
WINKHAUS, Jr., JOHN T.*
Carlisle & Jacquelin, New York
WINSLOW, PETER L.
Townsend, Dabney & Tyson,
Boston
New
York
Minneapolis
R.
S.
Dickson & Co., Charlotte
WITTER, WENDELL W.*
Kemper & Co.,
WILLEMS,
Co., New York
WITHERS, Jr., P. T.
WILDMAN, DEAN E.
A:
District Securities
WINSOR, JOHN R.*
Harris, Upham & Co.,
Clark,
W.
Publishing Co., New York
HARVEY WRIGHT
WINSLOW, SAMUEL R.*
Winslow, Cohu & Stetson,
LeROY A.
& Boyce, Baltimore
WILDE, BERTRAM M.
Janney, Battles & E.
Philadelphia
FRANK
Barrons
WILSON,
Pacific Northwest Company,
HANS A.
Carl M. Loeb, Rhoades & Co., New York
WILBUR, LeROY A.
Bros.
VINCENT
Co., New York
&
WILSON, LYLE F.*
WIDENMANN,
Stein
C.
Fuller
H.
Model, Roland & Stone, New york
WILSON, JAMES G.*
Exchange Commission,
Dempsey-Tegeler & Co., Los Angeles
WHITNEY, Jr., WHEELOCK*
~W.
D.
John
WILLIAMS, WARREN D.*
WHITNEY, Jr., LEWIS J.
John
California
.
.
Craig-Hallum, Kinnard, Inc., Minneapolis
WHITESIDE, THOMAS
Chace, Whiteside & Winslow, Boston
WHITLOCK, DANIEL P.*
Ladenbfirg, Thalmann & Co., New York
WHITNEY, II, JACK M.
WILBUR, Jr.,
UNDERHILL, ARTHUR J. C.
Arthur Wiesenberger & Co.,
TORREY, GEORGE R.
McCormick & Co., Chicago
Mrs.
York
UHL, PAUL E.
TOMASIC, ANTHONY E*
Thomas & Co., Pittsburgh
TOWBIN, BELMONT*
C. E. Unterberg, Towbin
New
Eppler, Guerin & Turner, Dallas
TURNER, ROY
Stephens, Inc., Little Rock
TYLER, Jr., CHARLES L.*
CARL W.,
WILLIAM H.*
Kuhn, Loeb & Co.,
JOHN
WHITE,
Securities
TSOLAINOS, K. P.*
Baker, Weeks & Co.,
&
TIMPSON, Jr.,
ARTHUR
Troster, Singer & Co., New York
York
JAY EMERSON
Co., New York
THORS,
Bonham,
Charlottesville
A. E. Masten & Co., Pittsburgh
TREUHOLD, CHARLES R.*
Paribas Corporation, New York
TROST, MILTON S.*
Stein Bros. & Boyce, Louisville
TROSTER, OLIVER J.
M.
ROBERT L.
Lehman Brothers, New
CHARLES H.*
Co., New 'York
Mr. and
TRAINOR, COLEMAN E.
Peoples National Bank,.
Philadelphia
TALBOTT, NELSON S.
Prescott & Co., Cleveland
'Denotes
ALLEN
TOWNSEND, WILLIAM H. P.
Janney, Battles & E. W. Clafk,
Philadelphia
TRAUERNICHT, CARL*
Charles & Trauernicht, St. Louis
THAYER,
Columbus
New
Baltimore
TEGTMEYER, WILLIAM H.*
Wm. H. Tegtmeyer & Co., Chicago
Chicago
NEWBOLD
DeHaven & Townsend,
Washington
St.
Heward, Butcher & Sherrerd, Philadelphia; Mr. & Mrs.
Close, Rambo," Close <ft Kerner, Inc., Philadelphia
Paul
J.
FRANK
TEGELER, JEROME F.*
Dempsey-Tegeler & Co.,
Baltimore
Sons.
W.
TAYLOR, GARRETT H.*
Wood, Gundy & Co., New York
New York
L.
&
Jr.,
Mead, Miller & Co.,
STOUT, Jr., ANDREW
L.
JOHN R.
Administration,
Maritime
STOTLER, ROGER G.*
Rowles,
James
Siefert, Stern Brothers & Co., Kansas City,
Rowles, Rowles, Winston & Co., Houston
R.
.
Dean
Indianapolis
New
Witter
&
Co.,
San
Francisco
WITTER, WILLIAM M.
Dsljan Witter & Co., Chicago
F.
Weeks,
York
New York
VALENTINE, II, HENRY LEE
Davenport & Co., Richmond
VANDERNOOT, JOSEPH F.*
R. W. Pressprich & Co., New York
WILLIAMS,
VAN
WWWWWWWWWWWVW^WWWWVWWWWWWVWWVWWWWWi
INGEN, Jr.,
J.
B.
Van
BERNARD
J.
The
A.
First
WOHLFORTH, ROBERT M.
Hemphill, Noyes & Co., New York
DUNCAN
National
Bank,
Memphis
Ingen & Co.. New York
VAN
LEER, Jr., WILLIAM L.
H. C. Wainwright & Co., New York
VEIT, PETER R.
Birely
Company
&
Hannahs, Ballin & Lee,
L.
Rothschild
P.
VIVIAN,
INVESTMENT SECURITIES
TAX FREE MUNICIPAL & REVENUE BONDS
BANK &
LISTED
INSURANCE STOCKS
UNLISTED
&
MUTUAL
1700 K Street,
N.W.
SECURITIES
FUNDS
Washington 6, D.C.
•
DISTRICT
Dean
RICHARD
Witter
Associate
Member
York
York
&
Stranahan,
C.
Co.,
Harris
JONES,
New
&
NEW
YORK
York
New
CAFRITZ
district
Stock
Boston Stock Exchange
Pittsburgh Stock Exchange
Exchange
Francis I.
WALLACE,
Mellon
to
Shields &
Company
Members of New York Stock
Exchange
E.
1625
7-5700
EYE
6,
EXCHANGE
STREET,
N.
W.
D. C.
Teletype—WA
67
New
York
LOCAL BANK STOCKS
&
Co.,
Hartford
—
duPont &
National Bank,
&
Co.,
WIRE
TO
HAYDEN, STONE & CO.
Pittsburgh
Los
OUR
NEW
YORK
CORRESPONDENT
Angeles
BRANCH
WASSERMAN, JOHN
Asiel & Co., New York
WATKINS, MILES
DIRECT
Co., New York
WILLIAM J.
Hutton
P.
CO.
EXCHANGE
Firm Markets in all
WARD, MURRAY*
Direct wire
STOCK
STOCK
WASHINGTON SECURITIES
WALLACE, HUGH C*
Philadelphia-Baltimore
&
|
AMERICAN
WASHINGTON
LOUIS*
Walker
EXCHANGE
BUILDING,
Toledo
Co.,
WALBERT, RICHARD B.
Blyth & Co., Inc., Chicago
WALKER, GRAHAM
H.
STOCK
PHILADELPHIA-BALTIMORE
York
WADSWORTH, ARTHUR L.*
Dillon, Read & Co., New York
WAECKERLE, HAROLD E.
Parker, Eisen, Waeckerle, Adams &
Purcell, Kansas City
G.
KREEGER
MEMBERS
Co.,
VOSTAL, JOSEPH
Kidder, Peabody & Co.,
WADE, GEORGE S.*
WALKER,
Member
&
Dempsey-Tegeler & Co.,
7-9244
New
New
VIALE, CHESTER W.*
A.*
OFFICES:
ALEXANDRIA,
VA.
BETHESDA,
MD.
VHWVHMWHHHWWiMWMWHmWWHHHHiWHUiHWHM
Stubbs, Watkins & Lombardo,
Birmingham
WATSON, GAVIN H.
Forty-One
Years in
Washington
Value Line Fund Distributors,
WATSON, RICHARD E.*
Zilka.
Smither
WATTERSON,
Fahey,
Firm
Markets In
&
Weeden
&
WEEDON,
H.
Cleveland
Co.,
ALAN
Underwriters
N.
Co.,
York
New
GEORGE
W.*
Crowell, Weedon & Co., Los
WASHINGTON
SECURITIES
Carl M.
our
Jr„ ROBERT S.
Moseley & Co., Poston
WEHMANN, GILBERT H.*
F.
Weld
WEHRHEIM,
Loeb, Rhoades & Co.,
New York
York
ALLAN
Stearns & Co.,
MEMBER
-
EXCHANGE
(Associate)
DISTRIBUTORS
SOUTHERN BUILDING,
-
DEALERS
WASHINGTON 5, D. C.
Telephone: STerling 3-3130
Teletype: Trading Dept. WA 28, 95 & 509
Miami
The
and
New York
Municipal Dept. WA 25
Alexandria, Va.
Corporate
PETE
Herald,
Securities
Miami
GEORGE B.*
First National Bank,
CHARLES
Putnam
Fund
Chicago
M.*
«
Distributors, Boston
WERNER, CHARLES S.
Shearson. Hammill & Co., Chicago
WESTERVELT. PAUL T.*
Howard, Weil, Labouisse, Friedrichs &
Co., New Orleans
WESTON, LEWIS M.
Goldman, Sachs & Co.,
WESTPHAL, HARRY L.*
Iowa-Des
Des
Branch Office:
Municipal
York
WENDT,
WERLY,
PHILADELPHIA-BALTIMORE STOCK EXCHANGE
STOCK
New
WEINTRAUB, ALLEN '
Newburger & Co., Philadelphia
1920
Johnston, Lemon & Co.
New
WEINTRAUB,
WEITZEL,
Bell
Co.,
&
ROBERT V.*
WEINIG, CARL E.
Winslow, Cohu & Stetson,
Correspondent
Bear,
UNDERWRITERS
Distributors
S.
Philadelphia National Bank, Philadelphia
ESTABLISHED
BOSTON
and
Angeles
WEEKS,
White.
Direct Private Wire to
New York
Co., Portland
WILLIAM
Clark
WEEDEN,
&
New
National
York
White
WHITE.
H.
EDWARD
&
MEMBERS NEW YORK STOCK EXCHANGE
Oldest
Investment
Banking Firm
in
Washington,
D.
C.
Bank,
Moines
WHITE,
G.
Moines
FOLGER, NOLAN, FLEMING -W. B. HIBBS & CO. INC.
725
15th
Street, N. W.
WASHINGTON
A.
Co., St. Louis
KELTON E.*
Walker & Co., St. Louis
Telephone Sterling 3-5252
5, D. C.
Volume
Mrs.
&
Mr.
Robert
194
Mark
Davids,
.
WOODARD, RONALD
York
& Co.,
A.
Lynch, Pierce, Fenner
Incorporated, New York
Jr., NORMAN
&
Smith
E.
Company, New York
The Northern Trust
Peters,
Writer & Christensen, Denver
Stone
Masten
Tuller
Co.,
Washington
ZUNIC,
New York
ZWAHL,
Mabon
Mrs.
&
Corporation,
F.
Pittsburgh
Co.,
LOUIS J.
&
Co., New York
Report of IBA State
Legislation Committee
trust
or
the
66
association or
corporation did not have
through
same
an
tax advantage as persons
investment
trust which invests in stocks and
bonds because the income from
real estate investments was taxed
who
invested
in
an
twice, once at the corporate level
and again when distributed.
Under Public Law 86-779, effec¬
1961, real estate investment
trusts are taxed in much the same
tive in
regulated investment com¬
panies. The trust, if it meets the
requirements of the tax law, is
exempt from the corporate tax if
way as
90%
or
more
of its otherwise or¬
dinary taxable income is distrib¬
to its beneficiaries
uted annually
who will pay ordinary
on
such
distribution.
income tax
The 90%
distribution rule does not include
long-term and short-term capital
gains which may be retained by
the trust for reinvestment in other
Any ordinary taxable
income retained by the trust in
excess of the 90%
distribution is
properties.
subject to the regular corporate
income tax. Any capital gains de¬
rived by the trust from the sale
of any of its properties is taxable
to the beneficiaries as capital gain
to
extent that such
the
distributed
The
to
gains are
the beneficiaries.
Securities
Midwest
Com¬
Association (including
Arizona, California, Illinois, In¬
diana, Iowa, Kansas,
Michigan,
Minnesota,
Missouri,
Nebraska,
missioners
New
Nebraska
Arizona
Nevada
California
New
North Carolina
North Dakota
Idaho
Rhode Island
Illinois
South Carolina
Indiana
South Dakota
Kansas
Tennessee
Louisiana
Texas
caused
has
practical problems
in qualifying securities issued by
real estate investment trusts, but
it
is
some
hoped
that
further
discus¬
trators
will
clear
the
up
major
Wisconsin
or
other
documents
even
to be used
dividual
(c) No person (including a bank
dealer) who participates in the
acquisition, disposition, assign¬
ment or transfer of a security by
or to a fiduciary including a per¬
of
ticipation in any breach of fidu¬
ciary duty by reason of failure to
inquire whether the transaction
such
a
breach
unless
proceeds
being
Particular
credit for
wrongfully for the in¬
of the fiduciary
benefit
was
other¬
VI
North American Securities
Administrators Meeting
The
year
President
of
the
IBA
committees
Annual
Meeting
attend
to
this act is due the
Association
Firms arid the
local members of its committees.
of Stock Exchange
provisions of this act pro¬
Continued
MIDWEST
44 YEARS
WRITERS
OF
on
page
FOR
AND
UNDER¬
AS
DISTRIBUTORS
GRADE
CORPORATE
MUNICIPAL
SECURITIES.
HIGH
vide that:
(a)
A
corporation
or
transfer
in the
AND
agent registering a security
name
of a person
who is a fidu¬
ciary or who is described as a
fiduciary is not bound to inquire
into the existence, extent, or cor¬
rect description of the fiduciary
relationship, and thereafter the
corporation and its transfer agent
assume
may
without inquiry that
newly registered owner con¬
tinues to be the fiduciary until
the
corporation or transfer agent
written notice that the
receives
fiduciary
is no
Stern BroDiers
MEMBERS
MIDWEST STOCK.EXCHANGE
Co.
&
INVESTMENT BANKERS
BALTIMORE
1009
OMAHA
CHICAOO
KANSAS
.
CITY, MISSOURI
ST. LOUIS
longer acting as
the particular
such with respect to
(b) The corporation and trans¬
agent may assume without in¬
fer
quiry that a transfer is within the
authority of the fiduciary and is
not in breach of fiduciary duty,
though the transfer is to the
fiduciary himself or to his nomi¬
They may assume that the
nee.
any
MUNICIPAL BONDS
GOVERNMENT BONDS
Municipal and Corporate
PARKER
Bonds and Stocks
FEDERAL AGENCY SECURITIES
/ EISEN / WAECKERLE /
ADAMS &
PURCELL, INC.
(ommercejrust (ompany*
INCORPORATED
Member
Midwest Stock
1012 BALTIMORE AVE.,
Exchange
Kansas
,
KANSAS CITY 5, MISSOURI
Member
Telephone BAltimore 1-4096
Bell Teletype KC 42
City, Missouri
CAPITAL FUNDS EXCEED FORTY SEVEN
Teletypes—KC
302
KC
Federal
133
the
of the N.A.S.A.
(whose members are the admin-
it
THE
this
urged chairmen of group leg¬
islation
the work
OVER
of
or were
wise in breach of duty.
who
guarantees the signature
the fiduciary is liable for par¬
son
the
were
that the transaction
or
though in their possession.
Wyoming
Missouri
fiduciary has complied with
obstacles.
records
that
the transaction
Washington
Mississippi
even
sions with the securities adminis¬
,
West Virginia
security.
policy
knowledge
instrument and with
including any law requir¬
ing court approval, and they are
not charged with notice of court
involves
Minnesota
The key
is shown that he acted with actual
the law,
Utah
Virginia
>
1961 is included as APPENDIX D.
of
New York
Georgia
on
controlling
or
Florida
the
statement
the
Jersey
New Mexico
Columbia
Dist.
Mexico. North Dakota, Okla¬
homa, Texas and Wisconsin)
adopted a statement of policy re¬
garding registration of securities
issued by a real estate investment
trust. A copy of that statement of
policy as revised through June 21,
This
been adopted
Alabama
Maine
Continued from page
Transfers
Columbia:
Maryland
Michigan
tate
now
Colorado
Securities
ABRAHAM W.*
Zucker, New York
JOSEPH
Security
This act has
District of
&
Thomas
Baltimore
Fiduciary
in the following 35 states and
Pittsburgh
III, G. THOMAS
"'Denotes Mr. and
Philadelphia
J.
Co.,
Webster
&
ZUCKER,
&
&
Pfeffer, First National City Bank, New York;
Larkin, First National City Bank, New York
Uniform Act for Simplification of
New York
Jacksonville
E.
Kidder
M.
J.
Boston
ZEUGNER, ORLAND K.*
WYATT, GERALD
Baker, Watts & Co.,
John
Washington
GEORGE S.*
EDWARD B.*
Pierce, Carrison, Wulbern, Inc.,
A.
ROSWELL
Theodore A. Gaskell, Hayden, Miller & Co., Cleveland; Paul Uhl,
United California Bank, Los Angeles
& Mrs. Delmont K.
.
ZAHNER, VICTOR H.*
Zahner & Co., Kansas City
ZENTZ, BILL*
Investment Bankers Association,
WULBERN,
YEAGER,
Co., Los Angeles:
Co., New Ycrk
YUNKER,
Merrill
Mr
&
YOUNG, JOHN D,*
Lee Higginson Corporation,
WOODMAN, DEAN S.
123
The Commercial and Financial Chronicle
YOWELL, ROY H.
Maritime Adminisfration,
B.
Hughes
Raffensperger,
WRITER,
.
YOUNG, RICHARD N.*
Kidder, Peabody & Co.,
S.*
Indianapolis
WRIGHT,
.
Ryons
Co., New York
FREDERICK
Walker & Co., New
H.
G.
Lester,
6120
C. Johnson, Kidder, Peabody &
WOLFF, JAMES W.
Zuckerman, Smith &
WONHAM,
Number
MILLION DOLLARS
Telephone—Victor
Deposit Insurance Corporation
2-7500
124
#
St.
Continued
state
the
Louis
A. C.
sky
blue
laws) in Seattle. The Chairmen of
Legislation Committees of the IBA
New York, Northern Ohio and
Southeastern Groups, in addition
to the Chairman of the Committee
and the Assistant General Counsel
Miami
St.
W.
of
Chairmen
Committees
each
the
states
to
and
comment
to
of
different
provide
informed
the
their
administrator
on
discussion
at
under
subject
securi¬
of the
attitude
administrators
ties
the
in order to understand
year
better
helpful to have the
their Legislation
attend this meeting
Kansas
Clark
Merrill, Turben & Co., Inc.
Cleveland, Ohio
Walter I. Cole
John C. Crawford
Bosworth, Sullivan & Company,
Inc., Denver, Colo.
COMMITTEE
Daniel
Cruttenden, Podesta & Co.
Pacific Northwest Company
Chicago, 111.
Seattle, Wash.
requirements for the regis¬
of non-exempt securities,
based on provisions of the Uni¬
form Securities Act, and to make
the necessary conforming changes
in other sections of the Act. The.
Co.
Alaska Act
previously did not re¬
quire registration of securities.
Theis
Stifel, Nicolaus & Company,
Incorporated, St. Louis, Mo.
ARKANSAS
The
Stein Bros. & Boyce
the
Louisville, Ky.
agents,
W. E. Wetzel & Co.
Trenton, N. J.
APPENDIX
& Sons
Wilbur E. Hess
Edwards &
A
Sons
ALASKA
Houston, Texas
The
Henning Billiard
J. J. B. Hilliard & Son
effective
of
broker
dealers
-
(2) Section 4, relating to the
registration of broker-dealers and
agents, was amended by deleting
a provision that registration
of a
April 18,
was
1961
stitutes
who is
automatically con¬
registration of any agent
a
partner, officer
or
direc-
Louisville, Ky.
ST.
Our
Trading Department Is
Local
Listed And
Ralph Hornblower, Jr.
MARKETS
LOUIS
New
"If there is
70
a
Market
we
can
you
find it"
W.
pin point distribution in this
area
JONES & CO.
ESTABLISHED
1871
York
Midwest
300
Stock
Stock
North
CEntral
American
Exchange
Stock
Exchange
Board,
(Assoc.)
of Trade
St. Louis 2, Mo.
St.
4th
Exchange
Chicago
Teletype
1-7600
SL
593
Branch Office—Bon Durant Bldg., Pueblo, Colo.
Direct Private Wire Connections with Pueblo
Josephthal
& Co., New York, and Francis
I.
branch and
du Pont &
Co., Chicago
Co.
Business Established 1874
Shannon Hughes
Incorporated, Indianapolis, Ind.
Hunter
H.
McKelvy & Company
Investments and Financial Service
Pittsburgh, Pa.
William
Members
New
&
Calif.
Raffensperger, Hughes & Co.,
Frank
EDWARD D.
I. M. Simon
Waggenseller & Durst, Inc.
Los Angeles,
Specialize In Orders For Banks and Dealers
registered representatives give
Weeks
York, N. Y.
William S. Hughes
Unlisted Securities
And Invites Your Inquiries
We
&
Hornblower
Active In All
L.
Hurley
Members Neyo York Stock
Baker, Simonds & Co., Inc.
Detroit, Mich.
H.
Marshall
Exchange
Johnson
McDaniel Lewis
&
Co.
315
North 4th
Street
CEntral
1-3350
Greensboro, N. C.
Roy W. Leriche
of
First
Des
Iowa
Corporation
Moines, Iowa
Thomas Lynch
IH
Moore, Leonard & Lynch
Pittsburgh, Pa.
Harry A. McDonald, Jr.
McDonald-Moore & Co.
We
Specialize
Detroit, Mich.
Sidney J. Mohr, Jr.
in
making close and sizeable position
markets in
issues
and
a
wide variety
are
of unlisted
always interested in
Thornton, Mohr, Farish &
Gauntt, Inc., Montgomery, Ala.
Frank L. Reissner
The Ohio
Company,
Columbus, Ohio
our own
retail
distribution.
Rauscher, Pierce & Co., Inc.
Dallas, Texas
Frank
chiles-schutz co.
C. Pierce
Charles
purchasing blocks for
L
Reissner
Corporate and Municipal Securities
Member Midwest Stock
Indianapolis Bond and Share
Corporation, Indianapolis, Ind.
E. F. Hulton &
Exchange
Company Wire System
Malcolm F. Roberts
Hornblower
SCtflEHCIi, mCHTEH COMPANY
320
N.
FOURTH
ST.
ST. LOUIS
2, MO.
Weeks
Denver, Colo.
Edmund
MEMBER MIDWEST STOCK EXCHANGE
&
H.
Sears
Estabrook & Co.
Boston, Mass.
412 Farm Credit
Bldg.
Omaha 2, Nebraska
Telephone 346-6677
Robert
J.
E.
Barth
San
Sinton
&
Co.
Francisco, Calif.
or
was
broker-dealer
Alaska Securities Act
amended
1, 1961, were the fol¬
amended by adding a
new Subdivision (e)
requiring the
registration of mortgage loan com¬
panies and loan brokers.
Summary of Amendments to
Securities Acts of 23 States
Baltimore, Md.
amendments to
Act, ef¬
Securities
(1) Section 3, requiring the reg¬
istration
Corporation, Nashville, Tenn.
Jr.
Arkansas
lowing:
W. Enos Wetzel
Harvey,
principal
fective July
Equitable Securities
A. G.
E.
Robert
to add
Snyder
A. C. Allyn &
started
tration
Company
Davenport & Co.
Richmond, Va.
Halliburton
Alex. Brown
Paine, Webber, Jackson &
Curtis, New York, N. Y.
since it
Henry L. Valentine n
John C. Hagan in
F.. Barton
years
Thursday, December 28, 1961
Milton S. Trost
Eppler, Guerin & Turner, Inc.
Dallas, Texas.
Gus G.
John F. Curley
Podesta, Chairman
City, Mo.
Mason-Hagan, Inc.
Richmond, Va.
Beecroft, Cole & Co.
Topeka, Kan.
STATE LEGISLATION
Robert A.
Co.
Dean P. Guerin
William H.
.
Slezak
The Milwaukee
Harry
Brothers &
Stern
.
Chicago, 111.
John F. Fogarty
Butcher
Room—42
.
Milwaukee, Wis.
Blair & Company
William
G. Edward
James E.
Chicago, 111.
Philadelphia, Pa.
meetings.
Respectfully submitted,
Company, Inc.
Keen
Sons
&
Francis C. Farwell
Paul, Minn.
W.
Edwards
G.
St.'Louis, Mo.
Beach, Fla.
Butcher & Sherrerd
We believe that other IBA Groups
would find it
A.
Z. Bronn
Kalman &
attended the meeting.
of the IBA,
Benjamin F. Edwards HI
Allyn & Co.
Robert
Louis
St.
Room-—Relaxing
William Atwill, Jr.
from page 123
of
istrators
Chronicle
The Commercial and Financial
124
Bell
1321 "P" Street
Lincoln, Nebraska
Telephone HEmlock 2-3324
Teletype—OM-451
Volume 194
Number 6120
.
.
.
The Commercial and Financial Chronicle
125
■■■■■■■
mm*.
"AcSC&w.
-
tisi
.
;S'i.
•i
it
•.'
'
■■■.'■' ■ '
.
:-V-'
;
u
Weintraub, Bear, Stearns & Co., New York; Barney Nieman,
Golkin, Bomback & Co., New York; Bert Behrens, Lehman Brothers,
New
\
II II
■ II
Allan
v
a
Edward
Harry Gassard, Investment Dealers' Association of Canada, Toronto;
Mrs. Arnold Massey, Toronto;
George C. MacDonald,
McLeod, Young, Weir & Co., Ltd., Montreal
York
B.
Burr, William Street Sales, Inc., New York; Edward S.
William Street Sales, Inc., New York; Richard W. Jones,
Mitchum, Jones & Templeton, Los Angeles
Amazeen,
gis-
ties,
tor,
tJriitiges
The.
:4
re-
to
s
effol-
(3) Section 4(e), which prevL
ously required broker-dealers and
investment advisers to post cor¬
porate surety bonds in the amount
of $10,000 and required agents to
post bonds in the amount of $5,000
amended
from examination for certain per¬
1961
!v.
J
to
a
con-
igent
irec-
shall pay the
to
be
ab¬
actual hotel and
traveling
ized
the
expenses of
examiner from
such author¬
Little
Rock
shall not exempt them from
sons
such
of the
part
examination
(7)
Subdivision (7) was added
6(b) to provide that any
issuer, unless exempted by Sec¬
examination requirement, and that
visers.
a
requirement
broker-
are
the
SEC
who
are
amended to include
ground for such
a
action
that
as
a
"has pending against him
charge of unlawful conduct in¬
person
members
also
was
a
volving securities
NASD, or their agents reg¬
the
securities
6)
or any
aspect of
business."
(6) of Section
6(b), regarding written examina¬
tions by applicants for registra¬
tion as an agent, broker-dealer or
investment
adviser,
broker-dealer
to
(i)
or
investment
ad¬
provide
based
rities
the act, seeking to act
of
acting
broker-dealer in its
behalf in the sale of its own
own
as a
securities
must
comply
the
with
single officer who shall have
direct supervision of the sale of
the
securities
shall
on
amended
each agent taking
the Uniform Secu¬
er,
salesman, investment counsel¬
lor
or
investment counsel agent.
Act, with modifications.
FLORIDA
The
The
Connecticut Securities
1961
authorize
to
(a)
commissioner to make, amend and
rescind
such regulations
as
are
necessary
sions
ties
one
of
Act
to carry out the provi¬
the
Connecticut
and
section
(b)
Securi¬
compiling
ing the
written
into
(1) Subdivision (9) of Section
517.05, exempting negotiable
promissory notes or commercial,
paper
(2)
was repealed.
Subdivision (5)
of Section
517.06, exempting the sale, transContinued
provisions relating to
on
page
represent the
of satisfy¬
examination re¬
(8) Section-11 (i), relating to the
of
securities and renewal of regis¬
effective period of registration
tration,
(i)
amended to provide
registration shall con-,
tinue effective only for a period
a
of 12 months unless sooner termi¬
and
and
upon
of
payment
fees
provided for original registration,
though the maximum fee was
paid the preceding period. Also
Section 11 (j) was amended to re¬
quire a filing, fee of $5 with each
report filed to keep current in¬
formation contained in the regis¬
even
tration
Members
Underwriters and
New York Stock
Distributors
Exchange
(ii)
renewal registra¬
tions for 12-month periods may
be issued upon written applica¬
tion
Newhard, Cook & Co.
was
that
statement and
to
American Stock
Listed and
Unlisted Securities
Exchange
Municipal Bonds
Midwest Stock
•7
(Associate)
Exchange
FOURTH
X
Telephone CEntral 1-5585
"variable annuity contract" with¬
in the definition. Also the previ¬
Subdivision
14(a),
issued
(5)
exempting
OLIVE
disclose
(9) Section 13(1), defining "se¬
curity," was amended to include
ous
AND
SAINT LOUIS
the progress of the offering.
of
Section
security
any
Branch Offices
Alton, Illinois
•
Clayton, Missouri
Private Wire
to
•
East St. Louis, Illinois
Clark, Dodge & Co., New York
by and representing an in¬
terest in
debt of
a
or
insurance
an
deleted.
Subsections (e)
company, was
(10)
added to Section
were
and
(f)
14 to pro¬
vide that before any security may
be issued as an exempted security
under
since 1Q00
One
Subdivisions
(3), (4), (5),
(6), (8) or (10) of Section 14(a)
and before any transaction shall
be executed as an exempted trans¬
action under Subdivisions (2), (9),
(10), (11) or (12) of Section 14(b),
a proof of exemption must be filed
with the Commissioner, containing
statement of the grounds upon
of
our
most important services to
institutions and individuals
TJ. S. GOVERNMENT, STATE
AND
MUNICIPAL
BONDS
*a
which
and
NEW
YOKK
STOCK
^yHANOE
G.IM/VALKERGCO.
%
C/ri/veStmmb UsamekL
BROADWAY AND
SAINT
New York
White
•
Plains
•
•
Pawtucket
Portsmouth
•
Hartford
•
sion
is
•
Philadelphia
•
which
claimed,
with
the
claimed
exemption
filing
a
fee
such proof of
emption filed with the
(i)
to
Section
cover
rule
or
relating
21,
penalties,
was
to
amended
willful violations of
order under the
(ii)
guilty of
a
that
felony.
New York
.
%■
ST. LOUIS 66, MISSOURI
Correspondent -14 Wall Street
Chicago Telephone to Bond Departinent
Dial 211 Request
RESOURCES
willfully violate the act shall
be
IcompaSHj
Enterprise 81*70
act
and
to declare
■
PgP|
Commis¬
who
Chicago
Member F. D. 1. C.
of
ex¬
sioner.
any
MERCANTILE
8th and LOCUST
(11)
Clayton
is
exemption
under
criminal
Bridgeport
Waterbury •
the
declaration of the subdivi¬
$10 for every
LOCUST
LOUIS, MISSOURI
Providence
a
persons
to
were as
follows:
bank
the
amendments
the Florida Securities Act
Act
amended effective October 1,
was
principal
issuer for the purpose
nated
isirwutors
denial, suspension or cancellation
of registration of any
broker, deal¬
quirement.
Subdivision
(4) Subsection 5(d), authoriz¬
ing examination of the records of
issuers, broker-dealers and invest¬
ment advisers, was amended
to
provide that the applicant, issuer,
was
complete
securities act effective July 1,
a
CONNECTICUT
to Section
14
adopted
as
broker-dealers and investment ad¬
Exempt from the surety
Colorado
relates to the securities act.
or
istered with the NASD.
and
sting
are
(5) Subdivision (C) of Section
6(a), regarding denial suspension
or
revocation
of registration of
of the
the
examiners
aminations, and in addition there¬
dealing exclusively in mu¬
nicipal or government securities,
and broker-dealers registered with
the
all
sent from the capitol building for
the purpose of making such ex¬
dealers
10m-
of
new
and
type surety bond for dealers and
agents under a scale specified in
bond
*
day or fraction thereof, that any
is required to
of $5 for each examina¬
(ii) that the exemption
tion
!.
COLORADO
examination
pay a fee
tion and
and return.
the law.
or
authorize
to
such
Commissioner to accept a blanket
reg-
ng a
:
or
tions.
was
•
viser shall pay a fee for each such
examination not to exceed $25 per
occupying similar
performing similar func¬
or a person
status
lake
OVER. $600
MILLION
126:
The Commercial and Financial Chronicle
.
.
.
Thursday, December 28, 1961
i
v
_
Richard W. Grimm, Government
Development
New York; Norman L. Macy, First Boston
Bank for Puerto Rico,
Corporation, New York
Continued from page 125
fer
(4)
or
"by the
issuer of such securities
or
to
broker
a
or
dealer
by a first lien or
privileged collateral and (b) to
eliminate Subdivision (h) which
by the duly authorized repre¬
of
such
issuer," was
authorized
amended to include
a pension plan
to whom exempt
be made and to elimi¬
receive
those
sales may
nate
tion
commissioner
of securities
or
description as one
specified classes.
the
representative of the
(3)
Subdivision
(7)
or
taneously holds
notes
and
or
a
life
a
tangible personal property
the
entire
mortgage to¬
with
bonds
for
notes
or
in
sale
express
offered
not
are
such
that
connection
with
guarantee
as
of
principal or interest, or both;
provided
further
that
such
bonds
are
securities license
insurance
to do business in this state
der
utes,
by
chapter
or
635,
insured
an agency
Florida
or
investment
feature
illustration
of
license,
and
the
life insurance
any
The
prepared
in duplicate, dated and
proposal
shall
be
than
un¬
three
a
ardized
and
of, in lieu of
a
a
receipt for stand¬
proposals
commissioner
of the federal gov¬
ernment."
period of not less
years
duplicate-copy
Stat"
guaranteed
ijvith the prospect
the duplicate retained by the
licensee for
April 5,
provide that, in addition
filed
may
with
be
held by the licensee.
affiant
such
tion
he
as
The
Securities
8, 1961
(1)
Subdivision
issuer
of
its
securities
portion of
such
securities
to
1
or
more
stockholders upon terms not less
favorable to the issuer than the
previous offering,
trading
of
the issuance
subscription
rights issued in connection with
the foregoing, and the sale
of
Kansas
Exemptions under this subsec¬
certificates
tion
securities to the holders of such
rights in the exercise thereof.
investment certifi¬
thrift notes issued by in¬
vestment companies"; by adding
as
or
Subsection
"investment
(1)
definition
a
company"';
and
Maine
and
to
of
90
Act
days
was
sales
sale
of
entitled
the
Act
as
of
'Small
Business Investment Act of
1958,'
with
409.050
(exempt trans¬
12 to
a
new
Sub¬
exempt, with speci¬
exceptions, secondary market
by registered dealers of se¬
a
recog¬
nized securities manual.
MONTANA
Montana
adopted
complete
a
securities act effective July 1,
based
rities
on
the Uniform Secu¬
Act, with modifications.
NEW MEXICO
The New Mexico Securities Act
was
amended
effective
March
3,
1961 to provide that the difinitions
and provisions relating to securi¬
ties
of
tained
an
in
investment
Section
fund
10
of
the
con¬
act
Do the
Investment
Underwriters
of
!
and
Distributors
Possibilities in
NORTH DAKOTA
ELECTRONICS
Corporate and Municipal Securities
SOUTH DAKOTA
Interest You?
i
•
WHY NOT
MUNICIPAL AND STATE BONDS
INVESTIGATE
Mutual Funds Shares
TELEVISION-
ELECTRONICS
SHAUGHNESSY 8c COMPANY.
Est.
First
ST.
1938
National
PAUL
INC.
Bank
FUND,
ALLISON-WILLIAMS COMPANY
Building
I
MINNESOTA
1,
INC.
A Mutual Invest¬
ment Fund whose
assets
are
primarily
invested for
M-
•
-
Get the
tal and income in
companies actively
1i
engaged in the Elec-
5
Harold E. Wood & Company
Booklet-Prospectus and
SAINT
PAUL
BANK BUILDING
1, MINNESOTA
now
rec¬
115
with active
trading markets in
from
MINNESOTA SECURITIES
or
Shares
Management Corp.
120 S. LaSalle St.,
FIRS^r NATIONAL?
Fund
investment dealer
Television
Investment Securities
UNDERWRITERS and DISTRIBUTORS
tronics field.
ord of this Mutual
your
Teletype: MP 163
©fiiaHSMifflaiaiaHfflaiaiaiaiaiaiaiaHasiaHSHfflSHaaHaaiaHaHaiaEiaiaiaisiai^
growth of capi-
i
j
pj'•
f' %
*
MINNEAPOLIS, MINNESOTA
Phone: FEderal 3-3475
•j£gj^ble long-term
AiWSsggm
CV
; h
possi-
I
@ •'
M. H. BISHOP & CO.
Members Midwest Stock Exchange
Chicago 3, III
Broadway, New York 6, N.Y
657
Northwestern Bank Building
Minneapolis 2, Minn.
Noma
Tel. FE 5-2205
Trading Dept. FE 5-6857
Address.
Teletype MP 126
City-State.
CFC
Direct Private. Wire
4<-»
curities about which specified in¬
(o) was
exempt:
securities
the latter
loans."
formation is available in
1961
Congress
after
fied
Commissioner may impose
by regulation for the protection
of investors."
The
small
a
condition
a
or
13, 1961 by inserting
section
new
(2) A new Subdivision
added to Sec. 451.105 to
small
actions of the Missouri Securities
Act was amended effective Oct.
such
prohibitions
contemplated under the
Securities
effective
subject
small
MISSOURI
Section
as
"(o)
The
be
the
MAINE
amended
shall
conditions
by
adding as Subsection (m) a definitioiuof "investment certificate."
providing
equity capital
stockholders, and the
subsequent offering and sale
to
company
concern as
to
rata to its
(definitions) was
amended by including in Subsec¬
tion (j) defining
security, "thrift
cates
vestment
pro
within 3 months after such offer
of any unsubscribed
(2)
or
a
a
a
business
"(n) The offering and sale by
an
by
to
concern
development company for
equity capital provided or loans
made, or (3) the sale of secu¬
rities by a small business in¬
as
(n) of Section
(exempt transactions) was
by adding the under¬
lined language to read as follows:
Act
or
to
451.105
informa¬
the
Administration,
business investment company or
was
amended
KANSAS
of
Michigan Securities Act
follows:
and
17-1252
Business
business
amended effective Sept.
Act, with modifications.
Section
ad¬
an
1958, where
such sale consists of (1) the sale
of securities to the Federal Small
MICHIGAN
INDIANA
rities
approved Aug. 21,
the sale of securities
Indiana adopted a complete new
securities
act
effective
July
1,
1961 based on the Uniform Secu¬
the
obtained
additional
Ronan, New York Hanseatic Corporation, New York; Kurt
Grunebaum, New York Hanseatic Corporation, New York
viding for the creation of
visory committee.
deems necessary rela¬
tive to such securities and the sale
thereof.
full
feature.
and
fully insured by an
company
authorized
to
Frank
adjournment of the Legislature by
inserting a new section 241-a pro¬
ized to require from the issuer and
signed by the licensee. The origi¬
notes shall be exempt
or
if they
1961
effective
ment. the commissioner is author¬
insurance
nal shall be left
amended
of the
or more
an
agreement or
to the repayment
recourse
was
his intent to purchase for invest¬
all
however,
involving an un¬
derwriting to not in excess of 25
persons provided such securities
are
purchased for investment),
sub¬
are
notes secured
"provided,
of securities not
quality and
the bonds and posal, on or before delivery of any
investment plan. Investment plan
thereby are sold to
shall mean a mutual funds pro¬
a single purchaser at a single sale,
was amended by
adding the fol¬ gram, and the proposal shall con¬
lowing proviso:
sist of a prospectus describing the
gether
GEORGIA
Section 6(j) of the Georgia Se¬
curities Act (exempting the sale
to the required affidavit signed by
each proposed purchaser stating
he
shall prepare and leave with each
prospective buyer a written pro¬
secured by mortgage upon real es¬
where
same
to
notifica¬
(5) A new section was adopted
to provide that if a person simul¬
of Section
517.06, exempting bonds
by
which
stantially of the
issuer.
tate
the
registration
the
provision which limited
the exemption to sales by the is¬
suer
by
notes secured
or
sentative
among
517.08
(relating to
notification) was
amended (a) to eliminate Subdi¬
vision (g) which authorized regis¬
tration by notification for bonds
registration
delivery of securities to a
bank, savings
institution,
trust
company, insurance company, cor¬
or
poration
Section
Sydney Duffy, Blyth & Co., Inc., New York; Mr. & Mrs.
E. B. de Selding, Spencer Trask & Co., New York
to
Gregory & Sons
1
K
■,
•91
Volume 194
Mr.
&
shall not
a
Mrs.
Number 6120
P. Fred
The Commercial and Financial Chronicle
Fox, P. F. Fox &
apply to the securities of
small business investment
Co., New York
vestment
George Le Vind, Blyth & Co., Inc., New York; Leo L. Quist, Harold
E. Wood & Company, St. Paul, Minn.; Robert G. Rowe,
Stroud & Company, Incorporated, Philadelphia
companies
under
com¬
the
127
registered
federal
Investment
that nothing in that section or in
Section
10-04-04
shall
be
con¬
but the securities of such
companies shall be registered with
Company
effective
strued to prohibit the publication
or
distribution to the public of
the commissioner of securities
April 8, 1961 (a) impose a license
fee of $100 for each branch office
preliminary prospectuses or pre¬
liminary
summary
prospectuses
and
under the
pany,
qualification, coordination
or
Act
no¬
tification, whichever is applicable
YORK
the
Section 35, 102-4(2) of the New
York Law relating to real estate
ment
of
shall be made in
of
York
New
such
or
until
to the offerer
a
cf
securities
the
attorney
letter or,
a
in the
NEVADA
Law
Nevada
act,
has
sections
Loan
and
the
year,
of
the
assessment
from
of
Dec.
31
of
assessment
to
be
as
no
state
of
the
Association
require the licensing of in¬
solicitation
no
order
or
Act
of
is
1933,
made
conditional order
or
ac¬
cepted prior to registration in the
state, and provided a specified
legend
appears on each such pro¬
spectus.
(2)
Subdivision
10-04-05,
(3) of Section
exempting policy con¬
tracts
an
of
insurance
company
knowledge
All
as
since
July 1, 1958 may have their
registration
renewed
without
passing such written examination.
Such
once
examination
each
ministration
Governor
NORTH DAKOTA
The
the
principal
North
were
(1)
as
variable
amendments
Dakota
Securities
was
to
of such
Act
follows:
Section 10-04-04, making it
amended to exempt also
or fixed annuity contracts
companies.
(3) A
added
an
new
to
Subsection (12)
Section
10-04-05
empt unsolicited
agency
was
to
unlawful to sell nonexempt secu¬
rities unless they are registered
tions by a
in the
purchaser written confirmation of
state,
was
amended to make
vided
such
dealer
delivers to
the order which
the commissions paid to the regis¬
tered dealer.
i
filing
of
garding registered securities) was
amended to include a provision
(4)
capital
once
by
who
securities,"
state
and
for
a
viously
the
pointed
a
securities
"shall
skilled
appointed
by
the
confirmed
by
the
four-year term
state
(pre¬
examiner
deputy
a
be
com¬
as
ex
ap¬
offico
principal amendments to the
Oklahoma
the
Securities
Act
were
following:
(1) Section 2(b), .d e f in i n g
"agent," was amended to exempt
individuals representing an issuer
in
effecting transactions in securi¬
ties
exempt
(4).
(5),
under
(6)
Subdivisions
(7)
or
of
Section
401(a).
(2) Section 2(1), defining,"se¬
curity," was amended to exclude
certificates
pation
title
in
or
fining
of
interest
oil,
an
lease.
or
gas
or
Section
"issuer,"
mining title
or
2(g),
amended
was
eliminate references to
or
partici¬
mining
an
de¬
to
oil, gas
lease. Section
2(c),
defining "dealer," was
amended by eliminating Subdivi¬
sion
(4) which subdivision ex-
administrator).
Continued
on
page
128
the
it also unlawful to "offer for sale."
(requiring the
advertising matter re¬
The
registered dealer, pro¬
Section
10-04-08.2
missioner
ex¬
transac¬
the
given
(9) Section 10-04-03 (1), re¬
garding administration of the act,
was amended
to provide for ad¬
kota,
by
in
be
each quar¬
ter in other locations in the state.
in
supervision
shall
month
city and at least
agency of the state of North Da¬
to
OKLAHOMA
securities
securities salesmen in the state
subject
among such companies
the basis of their gross assets.
the
of
salesmen
currently
registered on June 30, 1961 who
have been continuously registered
on
stating that
been filed and
alternative, a notification in writ¬
ing indicating deficiencies in the
offering statement or prospectus.
securities
operation
provided
Securities
de Milhau, Chase Manhattan Bank, New York;
Mr. & Mrs.
Andrew K. Marckwald, Discount Corporation of New York, New York
business.
prorated
or
offering has
attorney general not later
than
15
days after such filing,
Building
an
assets
gross
each
that the
Although
in
moneys
letter
the
shall issue such
that
each company, the total of which
shall not exceed 35c
per $1,000
from the State
general has issued to the issuer
for
collect
and
offer advertise¬
no
sale
or
finds
com¬
department he may annually levy
trust's,' was amended
May 1, 1961 by adding a
provision that
Amend¬
savings and loan fund will be
insufficient
investment
effective
1940.
(b) provide that if the
missioner
NEW
of
ments to Section 673.260
by
of
John
clearly identifies
Piper, Jaffray
Subdivision (8) of Section
($a£empting secondary
10-04-06
market transactions by registered
dealers in securities about which
Hopwood
&
ESTABLISHED
1895
'
•
-
'
V-
;!
*
■•
+
."
specified information is available
in a manual)
was
amended by
adding paragraph (f) that the ex¬
emption shall not apply to secu¬
INVESTMENT DEPARTMENT
FIRST NATIONAL BANK
MINNEAPOLIS
Specialists
bonds
of
and South
in
and
state
municipal
North
Dakota
Dakota, and United States
bonds
and
all
Federal
open
end
-
amount certificate
com¬
MEMBERS
(9) of Section
10-04-06 (exempting pre-incorporation subscriptions if certain con¬
ditions are met) was amended by
adding a proviso that no money
shall be received by the solicitor
prior to incorporation or registra¬
said
of
securities
with
TELETYPE
—
MP
178
(6)
A
new
inserted
was
by
Section
lic
•
State and Municipal
have
been
made
than
one
year
*
BILLINGS
•
GREAT FALLS
'
'
*
'
<
WW"" '
WH
illipiii
FALLS
registered
by
requires a $10 fee,
(7) Section 10-04-08
Bonds
Municipals
BOND
(relating
to fees) was amended by adding
a
new
subsection
(b) regarding
registration
fees
for
open-end
management
companies, mutual
funds, investment trusts, unit in¬
vestment trusts, contractual plans
Bell
System
Teletype MP 41
Phone
FEderal 2-0123
and
investment
rectors
distribution
prosperous
across
far-reaching
the
Northwest.
of
the
J. M, Dain 8c Co., Inc.
counselors)
amended by
adding a section
providing that the commissioner
shall require
as
a
condition of
registration
that
the
applicant
and, in the case of a corporation
or partnership,
all officers or di¬
was
We maintain markets in local
stocks and provide
amount certificates.
(8) Section 10-04-10 (regarding
registration of dealers, sales¬
the
men
DEPARTMENT
of Minneapolis
FARGO
as
of prior original regis¬
in
North
Dakota
or
and face
National Bank
•
dealers, and
becomes
effective
automatically
48 hours after filing unless
ad¬
vised to the contrary or advised to
specialize in Minnesota, Wisconsin, North
Northwestern
ROCHESTER
through S.E.C. registration. Regis¬
announcement may be
Agency Obligations
and South Dakota and Montana
'
out¬
furnish additional information and
We
(ASSOCIATE)
EXCHANGE
tration by
U.S. Government Securities
Federal
STOCK
regis¬
"announcement" for
for not less
tration
.
•
EXCHANGE
EXCHANGE
MINNEAPOLIS
SAINT PAUL
104-04-07.1
the result
•
STOCK
STOCK
MIDWEST
the
standing in the hands of the pub¬
.
AMERICAN
YORK
authorize
to
which
securities
.
NEW
Commissioner.
tration
Dealers in
securities
management
panies.
(5) Subdivision
tion
agencies
/
of
companies, mutual funds, unit in¬
vestment trusts, contractual plans
and face
Minnesota,
Government
rities
;
corporate & municipal
partners doing
se¬
curities business in the state, pass
a written examination as evidence
Minneapolis
MEMBER NEW YORK STOCK
Phone; FE 3-8141
.
2
EXCHANGE
Teletype: MP-73 MP-561
The Commercial and Financial Chronicle
128
Continued from page
127
occupying
person
any
similar
a
status or performing similar functhe
tions, or as a salesman, to submit
refining of oil, gas, coal, uranium, to and pass successfully an oral
sulphur or any other minerals or written examination as evi;and
who is not principally endence of the applicant's knowlgaged in effecting transactions in edge and understanding of the
securities. Section 401(a) (12) was securities business,
eliminated,
which
section
ex(3) Section 59.230 was also
empted certificates of interest or amended
by adding provisions
participation in an oil, gas or that applicants for licensing as
mining title or lease embracing a dealers shall pay an examination
specifically described tract of land fee of $50.00 and applicants for
eluded
who engages in
exploration or production or
one-tenth
of
an
fractional undivided
a
in
person
than
more
or
a
specifically
a
acre
interest
licensing as salesmen shall
an examination fee of $10.00.
described^ tract
„,iiu
an
equivalent
acreage
than one-tenth of
more
an
of
offered
for
sale
the
to
South Carolina adopted
acre.
Section 401(a)
(10), exempting commercial paper, was
amended by adding a proviso that
the exemption shall apply only to
obligations to pay money, sold or
(3)
a
com-
Plete new securities act effective
dune 14, 1961 based on the Unif?rm. Securities Act, with modi-
fixations.
catttit
persons
a a ic at a
f°U™ DAK°TA
mi_
T-he following amendments to
the South Dakota Securities Act
were adopted effective July 1,
renewal 1961:
described in Section 401(b)
(8).
(4) Section 202(b) was amended
to increase from $5 to $10 the
filing fee for initial or
registration by an agent.
(5) Section 305(b), previously
providing a filing fee for regis-
nor
than
more
$25 to $35 the minimum fee of
securities, from $10 to $25 the
minimum
intention
to $200
fee
to
notification
on
sell
from
and
the maximum fee
$100
noti¬
on
fication of intention to sell.
of
Section
48-1624
of the maximum aggregate
with the advice and consent of the
the Utah Securities Act, effective
Senate.
May 15, 1961,
fee of $25
and
minimum
a
maximum of $300,
a
amended to provide the fol-
was
1% of
aggregate offering
price of securities to be sold in
the
state
up
to $250 000; onelowing
the
of
one-tenth
fee:
maximum
1%
of
twentieth
(2)
55.1903
listed
by adding a provision that every
registration statement shall con¬
tain an undertaking by the appli¬
to
rule
such
under
prescribe
at
as
he
administrator
the
inaccurate
material
or
is
in
any
of
the
appropriate
in
listed
so
or
or rep¬
by subscription rights
have
been
listed
so
over-the-counter
appropriate
or
under
regulations of
and Ex¬
effect."
Section 55.1907
^ registration
OREGON
Securities Act was
amended effective April 28, 1961
(relating to
application) was
by
amended to provide that registration shall be effective from one
year
follows*
from issuance or (as
ously provided) until exhausted
by ,^e sa^e
the securities so
registered or until suspended,
tration by qualification had to be
dated within 90 days of the date
(4) Section 55.1908 (relating to
registration by notification) was
amended (a) to add to the infor-
of
Subdivision* (f)
filing,
must
so
now
that the balance sheet
be dated
of the latest
as
practicable date prior to the date
of delivery. Subdivision (k) of the
section
a
amended
that
of the security,
a copy
current financial
statement and, if required, a cona
sent to service of process and
registration by qualification do
registration automatically becomes
so
effective
not have to be certified.
(2) Section 59.230
amended
by
adding provisions that the
commissioner may require applicants for a license as a dealer,
including the partners of a partnership, the executive officers of
a
mation required to be filed
(b)
to change the time at which such
was
corporation
or
was
association
or
the
from
24
hours
to
72
hours after notice is filed.
(5) Section 55.1912, which previously required a surety bond by
a
broker in the
was
amended
to
amount
of $5,000
provide that the
exact amount of bond shall be ap-
proved by the commissioner, not
Distributors
hold
weekly
meetings
every
who "holds himself
person
itself out
or
ment
as
securities invest¬
a
counselor."
(3) Section 61-1-4(6), defining
"salesman," was amended so as
not to apply to a person employed,
appointed or authorized by an
issuer
and
to
eliminate
the
pro¬
partners of a part¬
nership and the executive officers
of a corporation or other associa¬
tion registered as a dealer shall
not
be
deemed
salesmen
by adding
exempt:
"(10) A
a
venture
of
ten
individuals, all
same responsibility
signing such an agreement,
or the incorporators
signing the
articles of incorporation."
(5) Section 61-1-10, relating to
registration of securities by noti¬
fication, was amended by increas¬
ing from $1 to $10 the fee to be
paid at the time of filing the
registration statement.
the
in
of
state
one-tenth
(previously
of
1%
of
a
par
which
such
to
add
is
stock
the
public
to
be
shall
to be the par value;
I
'
of¬
ST ARI. IS! II
&rott &
18 M
^>tnngfclloU)
be
11J 1 I J A I.
[)
lit 11 LDI NO
and
RICHMOND
*
VA
a
will
from
Investment Bankers & Brokers Since 1893
STOCKS
•
BONDS
requirement that appli¬
cants pass a written examination,
issuer
registered
under
was
whose
the
Act.
securities
have
qualification
by
This
section
Teletype: CHARVL 95
amended to provide that each
license granted to any
York
City
to
person
or
entitle
such
one
of
its
a
corporation
dealer
officers
to
or
Continued
on
MEMBERS:
NEW YORK STOCK EXCHANGE
Buford Scott
page 129
*
EXCHANGE
Walter S. Robertson
James H. Scott
L. Thornton
*
Marion N. Fitzgerald
*
Thomas D. Naal
Fleming *
R. Eldridge Longest
*
Joseph J. Muldowney
Sidney Buford Scott
*
Frederic S. Bocock
DIRECT WIRE
designate
members
AMERICAN STOCK EXCHANGE (ASSOC.)
STOCK
*0
one
shall
•
RICHMOND
also
dealer's
•
MUTUAL FUNDS
•
the
firm consisting of more than
John M. Nash
Girmscheid, Jr.
$1,000 of the aggregate offer¬
price of the securities to be
per
ing
(7) Section, 61-1-15, relating to
registration of dealers and
salesmen, was amended to except,
New
R. A.
(6) Section 61-1-11, relating to
registration of securities by quali¬
fication, was amended to provide
a filing fee of
$25; to provide that
of the registration is granted the
applicant shall pay a fee of $1
the
St., N. E., Charlottesville, Va.
Red path,
Alden H. Little
provision that the filing
be
applied toward the
registration fee.
C. F. Cassell & Co., Inc.
Auchincloss, Parker A
to
not
and
fee
Philadelphia-Baltimore Stock Exchange
to
Public Relations
having the
been
Wire
Director
Secretary Emeritus
within
subdivision
new
joint
than
more
an
Private
Director For
meaning of the definition.
(4) Section 61-1-5 was amended
to
Local Securities
Direct
Municipal
Ass't Educational
the
fered
MUNICIPAL BONDS
2-8157-8-9
Ass't
vision that the
deemed
Phone:
Gordon L. Calvert
was
deleted.
value); to raise the minimum fee
from $10 to $25; to eliminate a
provision that in case of stock
having no par value, the price
Dealers
CORPORATE SECURITIES
Third
Dr. William Zentz
authority to make
regulations as shall be
and
requirement that the commis¬
at
114
Counsel
commission,
was
by inserting a provision
deemed necessaary to administer
and enforce provisions of the Act.
sold
Member
Assistant General
Research
the power and
rules
fee
Underwriters
Municipal Director &
Director of Economic
securities
amended
cancelled or revoked.
incorporation filed with
same
articles of
follows:
were as
61-1-1, relating to
organization and powers of
the
previ-
of Section
59.170(3) was amended to eliminate a requirement that the balance
sheet accompanying regis(1)
Robert Stevenson, III
Section
(2) Section 61-1-4(4), defining
"dealer," was amended to include
securities
any
Erwin W. Boehmler
to
to
respect.
The Oregon
(1)
amendments
sion
(3)
as
securities
counter
change Commission such securi¬
ties to be exempt only so long
as
such listing or legal overthe-counter trading shall remain
becomes
or
incomplete
-
the Federal Securities
to be filed with
required
principal
A
the
the
The
regulations of the Federal Se¬
resented
information contained in any doc¬
ument
ex-
Murray Hanson
UTAH
curities and Exchange Commis¬
sion
and
all
securities senior
which
may
time when
any
to
Treasurer
that the commission is vested with
the
-
traded
amendments with the administra¬
tor
amended
was
traded over-the-counter
correcting
file
promptly
securities
also:
provisions
(6) Section 305(c) was amended
cant
national
any
state.
of Section
which may be legally traded in
interstate commerce under the
fee.
maximum
on
"over
from $250,000 to
(5)
(exempting securities
exchange)
empt
$500,000; one-fortieth of 1% from
$500,000 to $1,000,000; and 1/100
of 1% on the excess of $1,000,000
with a minimum fee of $50 and
no
Subdivision
Educational Director
the Tennessee Securities Act, re¬
quiring the financial statement of
balance sheet accompanying the
application of a dealer for regis¬
tration to be certified by an in¬
dependent
certified
public
ac¬
countant, was amended to permit
certification by a public account¬
ant licensed by the State of Ten¬
nessee.
Section 48-1619 (exempt
securities) was amended by add¬
ing a new Subsection
(K)
to
exempt securities of corporations
organized pursuant to the
co¬
operative marketing law of the
offering price of securities to be
of 1 %
General Counsel
of
sold in the state with
one-tenth
of
securities
of
Secretary &
Managing Director &
TENNESSEE
10
Official Staff of the IBA
of
(1) Section 55.1901 (relating to
administration of the act) was
revised to provide for administration by a securities commissioner
appointed by the Governor by and
tration
Thursday, December 28, 1961
.
amount of many of the fees, the
principal of which increased from
Item
1/AKUL1INA
$5,000,
.
$15,000.
(6) Section 55.1920 (relating to
fees) was amended to increase the
pay
carat i\ta
catith
5UI111
•
with
than
less
.
Scott &
TO:
CLARK, DODGE & CO., INCORPORATED," NEW YORK,
Stringfellow
•
P. 0. Box 1575
•
N. Y.
Richmond 13, Virginia
Volume
Number 6120
194
The Commercial and Financial Chronicle
...
*
/k*
*
»*CP7€
§
ft
*2r'\
Continued
from
$500
128
page
upon compliance with
and without payment of
ther
fee,
entitled
be
form all of the acts of
salesman.
The
to
redeemable
amendments
provide
a
in
open-end management
pany
or
unit investment
so
Jan.
the
the
each
of $10
year
been
$5 for a salesman;
$1 to $2 the fee
from
renewal
salesmen;
of
and
registration
provide
principal
Washington
effective
June
Securities
1961,
the
were
Subdivision (2) of Section
defining salesman, was
amended by deleting a provision
that a partner, officer or director
salesman
only
within
(2)
if
by
(except
any
director
whose
the
or
registration
(3)
21.20.190,
(2)
requiring that
a
file
on
least
with
the
director
filed
at
for
days, was amended by
making the requirement 10 full
business days.
(4) Section 21.20.320, relating to
the
in
the
director
stock
show
less
to
leases
or
property
tion
fee
for
all
securities
other
registered
was
amended
by
to
coordination,
eliminate
the
book
value,
is
common
sition
taken
Texas:
one
.
For
of¬
period
and not
>
several
Iowa
the
ported that in
be
met
was
re¬
ratio
of
ernment
preferred stock to
were
and surplus may not exceed 4 or
5 to 1 and that in Wisconsin the
its
business and that there
other unfavorable factors in
operation.
Another
"We
underwriter
have
had
stock
common
ratio may not exceed 2 to 1.
com¬
several
Tennessee:
Nebraska:
One
derwriter stated that: "In the
of
at
least
two
Nebraska and
of
these
Tennessee,
required to withdraw
tified by the prospects of sales in
that state."
cations
not
would
not
Iowa: Wisconsin: A few applica¬
A Network
by the
qualify
states,
we were
our
the
because
appli¬
offering
under
Continued
on
un-5
case
page
the
131
of Service
by private wire
commented:
California on
etc."
issue
which
most of the
where
applications
was
other
in
were
issues
of
no
more
than
number
of
slightly
fourth
shares
of
the
to the
offered
public
were
subject to options granted to em¬
ployees of the issuing company at
a
price substantially below the
public offering price.
price
application
for
registration was filed in Florida
because
of
a
requirement that
there be a sinking fund. These is¬
sues
included
the
following:
debentures
expenses
by
One
aggregating
Another
Texas
*
issue
because
considered
rejected
was
in
Commissioner
the
the stock
over
priced,
that too much of the income of the
company
was
from
government
contracts and that fixed payments
of
immediately
preceding application.
Florida:
a
a
year
than five years
It
(including California, Kan¬
sas, Illinois and Wisconsin)
was
rejected in Texas because of stock
options to employees.
Under a
restricted stock option plan shares
reason¬
of the proposed
for
stock.
in - California
unless
to do so because of the
registered
unless, if such
stock, it can
per year
preferred
capitaliza¬
must
cumulative voting rights,
authorize
at
and
which
filed
net income of not
average
than 5%
more
are
than investment trusts and securi¬
ties
or
one
not
for
com¬
ratios
unusually complex nature of the
filing required, the extreme po¬
case
B
stock
of the fair
of not less than
gas
acquired by
a
partnership or joint enterprise.
(5) .Subdivision (1) of Section
21.20.340 providing the registra¬
will
of
underwriter
pressed
For
any
fering price
exempt certain transactions
whereby interests in oil and
of
excess
able
exempt transactions, was amended
by
deleting
Subdivision
(16)
authorized
sale
tion
normally do not attempt to
qualify
for
Commission
10
which
in
with¬
Wisconsin
company.
One
many issues no
registration was
Michigan because
the
application
grant registration un¬
payment
"We
Reported in Qualifying
Michigan:
regis¬
not
issuing
rities Acts
tration statement shall have been
were
and
because the Commissions 4n those
too dependent on gov¬
was
stock
Iowa
outstanding shares. The Cali¬
Division
of
Corporations
the
or
Securities Under State Secu¬
of Section
one-half of
close to
less the stockholders consented to
Summary of Principal Prob¬
salesmen.
as
Subdivision
secondary
paid part of the expenses,
registered in California.
some
cases
the selling stock¬
states
lems
Several
not
would
and
APPENDIX
of fees for
payment
each
the
in
fornia
pos¬
taxation
that
registration of convert¬
states have established
in
requests to qualify recent offer¬
ings in Missouri but have declined
to do so because the complex fil¬
ing requirements lead to larger
legal and filing fees than are jus¬
political subdivision of
in
pany
concluded
for
preferred
drawn
Commis¬
the
because
ible
shares
total
securities.
holders held
any
States
sioner
the
of
In
security."
partner, officer or
registration as a
salesman is denied, suspended or
revoked) without the filing ^of ap¬
plications for registration as sales¬
men
United
of
limited
sale
issuer
pledging the
general credit thereof, for the
p u r p o s e
of
paying
such
salesmen
as
by,
or insular
power
not
Missouri
of
mented:
were
thereof,
assessment
registration
of
a
brokerautomatically
constitutes
registration of all partners, offi¬
directors
the
is
l/17th
matters arising out of the
the
guaranteed
of
having
and
company
about
tions
sub¬
only
to
offerings of stock sold to under¬
writers by stockholders, where the
follows:
division" thereof,
was
provision
a
dealer
or
the
for
has
or by any foreign
government, or combination of
foreign governments, or any
state, territory or political sub¬
a
that
cers
portion
registration fee
territory
any
any
otherwise
21.20050
by deleting
additional 12-month
are
session
definition.
^Section
amended
issuer is
or
he
the
fee
unsold
Several underwriters
California:
as
state,
(1)
comes
may
"(1) Any security issued by, or
the
principal and interest of
■which
broker-dealer
the
$25
a
deben¬
they do not file for
registration in Vermont because
issuers object to a required con¬
sent to service of process which
grants blanket jurisdiction over
principal amendment to the
to read
to
Act,
21.20.005,
a
an
of
Company
that
stated
paid.
The
following:
of
trust,
issuer
an
Credit
Vermont:
subdivision (1) of Section 189.06
by adding the underlined language
amendments
8,
outstanding after the offering.
Another issue was rejected
Wisconsin Securities Act amended
WASHINGTON
The
tures.
of
$5 fee
a
Deere
WISCONSIN
for each examination.
the
for
which
of
or
by
com¬
eliminate
payment
renew
15
increase
the
period
for dealers and
for
that"
added
was
upon
be¬
on or
to
E. Brasted, Evans & Co. Incorporated, New York; Stuart Stevenson, Bankers Trust Company,
York; Chuck Miller, Mullaney, Wells & Company, Chicago; Peter Knoop, Auchincloss, Parker <ft
Redpath, New York; Calvin W. Clayton, Clayton Securities Corporation, Boston
fering price. The securities
ject to such options were
$1,000 maximum J!ee but a proviso
reinstatement fee when
license is not renewed
fore
amended
was
section
this
company
issued
securities
New
Montgomery Ward Credit Corp.
debentures; General Motors Ac¬
ceptance Corp. debentures; John
Subdivision
an
desig¬
nated must make application for
a salesman's license accompanying
the application of the dealer. Fur¬
person
certificate
amount
per¬
securities
a
fee.
relating to the registration
fee for securities issued by a face
fur¬
of the
issuance
upon
shall
license
maximum
(2),
the
who,
a
Daniels
Sheils, Gregory & Sons, New York; Leslie L. Lentz, Lentz, Newton & Co., San Antonio,
Texas; John W. Turner, Eppler, Guerin & Turner, Dallas; Frank R* Newton, Jr.,
Lentz, Newton & Co., San Antonio, Texas
^
ther
mkw
H.
James
Act
129
the
company
were
Missouri: One issue
^^BBOTT, P
ROCTOR
&
P
AINE
Members, New York Stock Exchange and Other Leading Exchanges
Investment Securities
•
Municipal Bonds
911 E. Main Street, Richmond 14, Ya.
2
•
Mutual Funds
•
Commodities
Phone Milton 4-5411
*
Broadway, New York 4, N. Y.
*
*
•
Underwriters
Teletype RH-851
Phone WHitehall 3-8300
too heavy.
(which
was
registered in California, Illinois
and Texas) was rejected in Mis¬
souri because options outstanding
to some of the management of the
issuer
(who
stockholders)
a
were
were
also
selling
exercisable at
price lower than the public of¬
Municipal Bonds and Corporate
Securities
Local Industrial &
Trading Markets
mason-Hagan
INVESTMENTS
Utility Stocks
Retail Distribution
STRADER and COMPANY, INC
Members
1017
EAST
1433
RICHMOND
MAIN
STREET, RICHMOND, VIRGINIA
Philadelphia-Baltimore Stock Exchange
LYNCHBURG, VIRGINIA
LD
ROAD, WILLIAMSBURG,
,
39
-
Victor 6-1333
Private Wire to Shields &
Branch—S
UNDERWRITERS •
DEALERS •
DISTRIBUTORS
Members
Richmond Stock Exchange,
Philadelphia-Baltimore Stock Exchange
Telephone Ml 8-2841
-
TWX LY 77
VIRGINIA
Teletype RH-460
S.
Market
Company, New York City
St., Staunton,
Virginia
130
Mr.
Mr.
&
&
Mrs.
The Commercial and Financial Chronicle
Roy W. Doolittle, Jr., Doolittle £ Co., Buffalo, N. Y.; Mr. & Mrs. Alexander
Common, Dann £ Co., Buffalo, N. Y.; Mrs. Andrew Peck, New York
Mrs. John T. Winkhaus, Jr., Carlisle £ Jacquelin,
Harold
R.
Mr. &
Mr.
Mrs.
L.
B.
W.
&
Mrs. Lewis
Mrs.
N.
Doyle, Fahnestock £ Co.,
Davies
Robertson,
South
M. Krohn, Ira Haupt £ Co., New
W.
Mrs.
New
York;
York
Towbin, New York; Mrs. J. Emerson Thors, New York; Mrs. Harold X. Schreder;
Schwinn, L. B. Schwinn £ Co., Cleveland (in rear); Harold X. Schreder, Distributors Group,
Incorporated, New York (in rear)
Horton, Penington, Colket £ Co., Philadelphia; Theodore C. Shaeffer, Janney, Battles £
Clark, Inc., Philadelphia; Sidney S. Blake, Janney, Battles & E. W. Clark, Inc., Philadelphia;
M. Wilde, Janney, Battles & E. W. Clark, Inc.,
Philadelphia; William H. P. Townsend,
Janney, Battles & E. W. Clark, Inc.
Bertram
.
.
Thursday, December 28, 1961
S. Whitney Bradley, Eaton <& Howard, Incorporated, Boston; Herbert H. Davis, Jr., Kirkpatrick-Pettis
Company, Omaha; Eugene de Bronkhart, Hill, Darlington £ Grimm, New York
M. Griggs,
Belmont
Arthur
E.
&
New York;
Holmyard, Hayden, Stone £ Co., New York
.
Albert
Bend,
McGann
Ind.
Securities
Company,
Mr.
&
Mrs.
Harry
Hans
A.
Irving Koerner,
Michels, Allen
Allen & Company, New
Company, New York
York;
£
Widenmann, Carl M. Loeb, Rhoades £ Co., New York; Mr. & Mrs. Malcolm S. Prosser,
Seattle-First National Bank, Seattle; Sherman Ellsworth, Wm. P. Harper £ Son £ Co., Seattle
Gilbert
Vincent
Wehmann, White, Weld £ Co., New York; Garrett H. Taylor, Wood, Gundy £ Co., Inc., New
York; Edwin J. Dikeman, Bankers Trust Company, New York; Earle Gatchell,
Hayden, Stone £ Co., New York
Reilly, Commercial £ Financial Chronicle, New York; Robert O. Shepard, Prescott & Co.,
Cleveland; Malcolm F. Roberts, Hornblower & Weeks, Denver; Herbert R. Anderson, Distributors
Group, Incorporated, New York; Erwin Boehmler, Investment Bankers Association, Washington, D.
C.;
Joseph W. Sener, John C. Legg & Company, Baltimore
Volume
194
Number
6120
Continued from page 129
statutes
and
regulations
It
is
Illinois
like
opinion
our
ministrators
were
and
that
discretion.
should
that
said
be
ministrators
do
all
not
state
rely
other
and
states
warrants
the
portions
policy.
have
real
west
.
stock
of
company
a
policy
not
business
to
Indiana:
required
a
attached
to
stating "These
page of
the
adopted the
of the Mid¬
policy
the
as
fac/
after be
disfavor
as a
looked upon
and
will
than
Warrants:
the
There
they
are
sence
the
adequacy
of
rants
of
a
and
Members
Midwest
is
(b)
Oshkosh
•
Madison
•
Marinette
•
•
number
shares
of
or
op¬
of the
10%
"step-u|>!lof the
to
or
warrant. The^ election
step-up rate must be
(d)
The options
(e)
are
than
11
The
months
Co0?
in
where
the
stage
it
of
the
the
the
}
(4)
is
value
warrants
or
and
the
direct
holders
of
the
beneficial
(b)
No
Assets
the
Acquired
shall
trust
directly
be
indirectly,
or
conveyed
or
From
acquired,
from
or
to
no
outstanding
SERVICE
usual
officer,
trust,
tractor
of the
trust
or
shortly
thereafter,
only
if
such
assets
pendent
the
acquisition
the
is
based
appraisal
on
as¬
trust,
then
and
price
or
inde¬
an
acceptable
administrator;
nor
may
to
any
such person receive a commission
other
reasonable
(3)
policies
followed
be
remuneration, directly
or
are
OF
UNDERWRITERS
shares,
shall not
personally liable
be
account of
any
beneficial
and
customary
com¬
would
of
be
such
in
the
ab¬
options
or
include
of the trust. To reihforce this ob¬
vided
that
all
written
to which the trust is
include
Continued
market
value
options, if
MUNICIPAL
Exchange
1001 EAST MAIN
liberal
ST., RICHMOND, VA.
ROANOKE, VA.
ROCKY MOUNT, N. C.
307 First St.
126 N. Main St.
Arcadj^
Direct Wire
to Eastman
Dillon, Union Securities & Co., New York
the
mar¬
Specializing since 1932
any,
in the
that
a
MUNICIPAL BONDS
SECURITIES
■
WEST VIRGINIA
herein, unless evi¬
that
Of
the
1
VIRGINIA
treatment.
NORTH CAROLINA
APPENDIX D
Estate
Milwaukee 2, Wis..
of Policy in Real
Investment
Exchange*Other Principal Exchanges
missioners
Trusts
SOUTH CAROLINA
of
405
revised June '61
as
Applications to register securi¬
ties
issued
issuable
or
BR
6-8040
j
CHICAGO: ST 2-0933
by
a
real
SERVING
EXCLUSIVELY
IN
THE
FIELD
OF
estate investment trust shall gen¬
erally be looked
MILWAUKEE:
page
American Stock Exchange (Assoc.)
the Midwest Securities Com¬
Phones:
that
Telephone MI 44651
NORFOLK, VA.
15 Selden
arbi¬
an
indicates
indicates
Statement
Ml
on
SECURITIES
where
cases
exists
evidence
recommended
INCORPORATED
Teletype:
party shall
DISTRIBUTORS
Teletype RH-196
(5)
That the same tests be
applied to options issued by "sell¬
ing shareholders" as has been
LOEWI & CO.
Members: New York Stock
a
provision
a
favor
unless
quirements
the
are
with
dis¬
following
re¬
upon
met
municipal bonds
616
EAST
MAIN
STREET
Telephone Milton 3-2861
•
RICHMOND
15,
VIRGINIA
Teletype RH 83 & 84
pro¬
contracts
Members
York Stock
on
of the obligations
com¬
selling
shareholders
are
so
separated
from the corporate entity and so
lacking in control of the corpo¬
rate
entity as to require more
•
owners
jective, it should further be
DEALERS
AND
the
or
J. C. Wheat & Co.
the
to
than
necessary
to
of the options
dence
St.,
That
shareholders
contrary valuation exists.
investment facilities!
Mason
certificates,
or
TRAOOW MARKETS M VIRGINIA SECURITES
New
the
with
BENEFICI¬
non-assessable.
indirectly, in connection with the
CORPORATE
in¬
by
stated
particularity;
LIABILITY
That the
employee,
of the
be
should
con¬
acquisition of
sets at the formation
to
trustees
ARIES.
independent
except for the
investment
The
tended
That in those states where
unless
complete
two-
shares
interest.
trary value of 20% of the original
exercise price of options be used"
THROUGHOUT WISCONSIN
E.
of
any
trustee, investment adviser of the
of
lower
are
be used. That in those
225
written
or
circum¬
issuance
commissions
ket value of such
INVESTMENT
of
Trustees and Others—No assets of
from
appears
in the
putation of commissions the
.with
vote
the
warrants.
it
..
shares
promotional
facts
that
missions
BRoadway 6-0525
YOUR
outstanding
the
the
of
of
after
relatively small
company
sence
AT
elected annually
are
by
consent
thirds
beneficial interest.
warrants
or
options
issued by a
underwriters
291
all of whom
by
moved
minimum of three trustees
banking service, provided that
/ Wholesale Distributors
TELETYPE: MI
a
of Trustee — A
may
be re¬
trustees
or
issuance, and;
Wausau
Incorporated
-
and Election — A
real estate investment trust shall
have
Removal
trustee
Number
(a)
or
such options is
necessary to ob¬
tain Competent investment
TELEPHONE
(d)
TRUSTEES.
do not exceed five years in dur¬
ation
and
are
exercisable
no
all
Securities
instrument
exercise price
the
stances
of
of
The declaration of
or
the time the option
warrant is issued.
Correspondent / CLARK, DODGE & CO.
Underwriters
trust
of
7%.eri:h year they are out¬
option
I
Robert W. Balrdl &
acquisition
or
Liability
(c)
or
duties.
(1)
in the alternative,
an
over-all 20%
step-up. The
step-up
shall
commence
12
months afresh the grant of the
•
disposal
assets.
an
the Trustee—
trust, or other
forming the trust shall
of the Internal Revenue Code not
contain
any
provisions re¬
of 1954, as amended.
lieving any trustee from liability
to the trust or its security holders
(B)
Declaration of Trust: The
declaration of trust, or other in¬ to which it or he might otherwise
be subject by reason of acts con¬
strument
forming
the
trust,
shall, among other things, or¬ stituting bad faith, willful mis¬
dinarily contain provisions pro¬ feasance, gross negligence or
reckless disregard of its or his
viding for the following:
or
made at
Waukesha
as
associa¬
tion which intends .to comply
with Sections 856, 857 and 858
or
partnership.
a
(c) The initial exercise price
of the options is at least equal
to th$r publjk offering price with
SPECIALISTS IN WISCONSIN SECURITIES
New York
in
public offering
employees.
sooner
•
underwriters
a
by the warrants
rants to
step-up
unincorporated trust
(2) INVESTMENT POLICY.
to be outstanding at
completion of the offering,
such percentage including war¬
Exchange
Sheboygan
favor¬
upon
securities
i
Racine
exercise,
the
Stock. Exchange
■■
•
of
tions do not exceed
Megnbers American Stock Exchange
■
Bay
to
The
covered
Milwaukee
Green
exercise, be gen¬
favorably;
vestment trust is defined
through
writer
as
Associate
pur¬
number
the undewriter when the under¬
robert wa banrd $l co..
Stock
in
(a) They are issued to the
managing underwriter under a
firm
underwriting
agreement
and are not assignable or trans¬
ferable, except to partners of
of
York
incentive
method
issued
standing,
New
restricted
Definition: A real estate in¬
(A)
upon
connection with
a
Members
for
reasonable
method
manage¬
of
(3)
That
the
Statement
of
Policy be given a liberal inter¬
pretation as to options or war¬
exercisable and the ab¬
or
if
to
nature
generally looked
ably;
which
in
terms
de¬
That options to employees,
or
their
nominees, pursuant to
stock
purchase plans or profit
sharing plans, if reasonable in
sought to be issued, the exercis¬
price,
in
(2)
applicant to justify their
able
the
erally looked
issuance. The number of warrants
of¬
options
options
poses,
and
considered
and the burden shall always rest
on
That
stock
basis for denial of the appli¬
that the
car¬
administrators
in
the
cation except in unusual instances
are
(1)
with great
be
of
use
ment
purchase
other
those
suggests
the
or guides for
price, if:
se-
reports of difficulties
many
to
stock
or
committee
termining whether the issuance of
stock
options under the State¬
ment of Policy is justifiable:
purchasers of securities will here¬
sticker
the prospectus
and
Securities
Approved in 1959,
Warrants
speculation."
Options
Warrants
American
the
be
Op¬
of the
on
Revised in 1961
legend required by the
a
and
Standards
prospectus
speculative
are
C
of Policy
This
exercisable price will
consideration.
following standards
number
Administrators in eluding
se¬
these
SEC that "These securities
were
of
have
in
Securities Administrators.
North
were
that
special
curties," despite the
fered
which
options
There
complaints
several
cover
trusts
tions
Tennessee bank.
ried
investment
Statement
of the Commission
register any small
investment company
Illinois:
be
registering
APPENDIX
denied regis¬
was
curities, and there was also a sug¬
gestion of requiring officers and
directors to deposit stock of the
company held by them in escrow
States
Trusts:
in
statement
tration in Tennessee because it is
to
Investment
estate
reported that
small business invest¬
ment
a
of
statement
underwriter
One
in
report
all or
dif¬
shares of
ficulties
applications."
there
the
follow
Ad¬
Several underwriters reported
states
the
also
that
Estate
Real
check
options
by
the
Securities
states
of
on
adopted
and
which
to
ground
.
and after hearing an
explanation, have qualified our
.
policy
American
as
on
underwriters
ministrators
It
to inquire of the back¬
us
that
ad¬
Hampshire, North Carolina, Rhode
called
all be taken into
North
action taken by other states. The
administrators of Georgia, New
Island
rate in the
sues
and
ad¬
131
in
gested
stretching their
administrative
The Commercial and Financial Chronicle
.
the statement of
Indiana.
these
.
registering in various states is¬
involving options and war¬
rants. On this subject it is sug¬
of these
states, but rather because our ap¬
plications were not acceptable to
states
.
the
132
Continued from page
shareholders
shall
not
131
(6) SPECIAL MEETINGS.
beneficial owners
or
be
personally
trustees
The
thereon.
ther be required
liable
fur¬
must
to maintain ade¬
quate insurance against possible
liability on the part of the trust,
For preparation of an an¬
report consisting of a de¬
tailed report of the activities of
the
trust
during
the period
(a)
nual
the report and of a
sheet, statement of in¬
by
balance
and surplus of the trust and
come,
opinion
an
thereon
of
on
examination
an
of
the
books and records of the trust not
materially limited
in
made
and
scope,
with
auditing
accepted
erally
in
accordance
gen¬
proce¬
dures;
For the filing of such an¬
report with the trustees, and
the Administrator,
and the de¬
livery of a copy thereof to each
shareholder or beneficial owner,
days after the close of
period covered by the report.
delivered to the trustee
the
90
The copies
and administrator shall be manu¬
ally signed.
furnishing
For
(c)
shareholders
to
and
beneficial
or
the
to
owners
Administrator, of in¬
the
reports, at least quarterly,
containing
a
current
balance
sheet which may be unaudited;
and
other pertinent information
terim
regarding
the
tivities in the
the
and its ac¬
quarter covered by
trust
report;
For
an
meeting
annual
of the
by any officer
written request
shareholders
holding together
twenty-five per cent
shall
outstanding shares
entitled
of the
nature
transacted
and
to
business to
considered.
be
the
For
inspection of the trust
records
by the Administrator at
reasonable time; and inspection
of trust records
by a shareholder
beneficiary of the trust as per¬
mitted
local
under
extent
same
as
law
DISTRIBUTION.
accompanied by
statement in
a
writing advising of the source of
funds
the
there
distributed.
so
doubt
be
may
as
case
to
this
the communication may
state,
in
which event, the
necessary statement shall be for¬
warded to shareholders, or bene¬
matter,
so
not later than 60 days
close of the fiscal year
ficiaries,
after the
distribution
the
which
in
was
made;
change shall be made
of trust,
or
instruments
forming
the
That
in
no
declaration
the
other
trust, without the vote or written
consent of the holders of two-
shares
outstanding
the
of
of beneficial interest.
quired in 4 (a) above;
shares
That
trust
the
at
ter¬
be
may
by a vote
time,
any
TRUST.
or
written consent of the holders
of
two-thirds
outstanding
the
of
interest.
beneficial
of
(8) Engage in trading as com¬
pared with investment activities;
real estate investment trust
Issue securities of more
class;
(10) Issue redeemable securi¬
ties;
(11)
Hold
securities
in any
(9)
(1) Invest more than five (5)
percent of its assets in unim¬
proved
real
property
Unim¬
proved property includes, among
other things, vacant land, lots on
which the
permanent buildings
have
not
been
completed, and;
than
holding investments or
in activities prohibited
by this section; '
(12) Engage in underwriting or
agency distribution of securities
engaging
or ranching land;
(2) Invest in commodities;
agricultural
(3) Invest in any mortgage or
deed
on
unimproved real
property
(a) Selling and Promotion Ex¬
there
pense—That
on
shall
limitation
be
a
selling
on
promotional expenses, based
requirements of local law;
Annual Expenses—The ag¬
(b)
gregate annual expenses of every
character, exclusive of interest,
in
or
mortgage
any
than
other
deed
trust
issued
or
first
a
ings
able sales commissions in the dis¬
trust
position of properties shall not
exceed $5,000 or 1 % of the aver¬
age net assets of such trust cal¬
to
semi-annual
or more
event the trust has no investment
adviser,
if
or
compensation
the
Va* of
less than
adviser is
of the
1%, the expenses, including such
to the adviser, if
not exceed l1/2% an¬
nually. The maximum amount of
such expenses shall be stated in
the prospectus.
(5) Invest in
may
deed
Contracts With Independent
all con¬
with
independent con¬
tractors for the management,
Contractors: A copy of
tracts
a
bank, insurance
other institutional
lender, and then only if the un¬
paid balance of said mortgage or
trust deed, or other encumbrance
at the time of such investment, is
not
in
for such services in the area
encumber
its
of
any
in
property is located.
RECORDING: That the dec¬
of trust, or other in¬
strument
forming
the
trust,
laration
be filed for record in the
shall
real
more
the
of
office
than 66%% of the
fair market value of said property
(13) APPRAISAL.
as
confirmed by a competent in¬
The consideration paid for real
property acquired by the trust dependent appraiser.
shall ordinarily be based
upon
(7) Acquire or convey any inproperty
by
(E)
of its net assets;
of the net value
the
which
borrow, unsecured, more than 8%
nor
the
accompanied
evidence that the
fees therein provided are in ac¬
cord with the prevailing costs
short sale,
any
with
filed
be
satisfactory
66%% of the
property
as confirmed by
a competent in¬
dependent appraiser;
Engage
shall
Administrator
fair market value of said
(6)
or furnishing of serv¬
tenants of trust proper¬
operation
ices to
ties
than
greater
in¬
beneficial
of
(D)
or
company,
outstanding shares or
terest.
other encumbrance
or
a
than
certificates
real property
any
or¬
net capital of
$100,000 repre¬
have
less
not
than
other
compensation
any,
dinarily
(4) Invest more than one (1)
percent of its assets in real estate
contracts of sales;
trust shall
investment
tate
sented by
which is subject to a mortgage or
on a
(C) Minimum Capital: A real es¬
association;
loan
and
taxes, maintenance and upkeep of
trust assets, payments to indepen¬
dent contractors, compensation to
investment adviser, and reason¬
culated
shareholders ratably.
sav¬
a
securities; other than to all the
its
or
under local law to
mitted
by others;
(13) Issue warrants, options, or
similar evidence of a rights to buy
first trust deed not
in a greater percentage of value,
as confirmed by a competent in¬
dependent appraiser, than per¬
mortgage
one
company
trust
(12) EXPENSE LIMITATION.
frequent basis, consistently ap¬
plied, whichever is greater. In the
(9) CHANGE IN TRUST.
minated
—
In
contractor, or em¬
for the trust also has an
interest, directly or indirectly, ex¬
cept as permitted in Rule B(l)
(b);
shall:
whichever is less.
certificate holders shall
or
shall be
the basis of cost less
depreciation or, in the judgment
of the trustees, fair market value
of the
net
assets
of the trust,
and
distributions to share¬
That any
holders
property it
on
reasonable
notice to the shareholders,
owners,
following
delivery of the annual report re¬
beneficial
cor¬
real
of
calculated
the
to
is permitted
shareholders;
porate
Vz of 1% annually, of the net as¬
of the trust managed. In the
adviser of the trust,
independent
PROHIBITED ACTIVITIES.
No
property in which
any
trustee,
ployee
administrator.
(14)
in
terest
any
qualified, disinterested, indepen¬
dent appraiser, acceptable to the
the
by
sets
case
(10) TERMINATION OF
or
be
business
other
no
shareholders, or beneficial owners,
at
a
convenient location on
proper
vote
(7) INSPECTION OF RECORUS.
be
into
entered
trustees
vestment adviser shall not exceed
trust
or
advisory
meeting. The call shall state
of the
the
a
investment
at
(25%)
the
disposition
the
and
An
contract
the
over
ordinarily may not be for
a
period longer than one year.
The total compensation of the in¬
of
such
control
of the trust and its
management
thereof.
thirds
(5) ANNUAL MEETING.
exclusive
and
property
(b)
within
The trustees shall have absolute
owners,
President,
majority of the trustees
a
the
property as determined by a real
estate
appraisal prepared by a
of the Trust upon
(8)
nual
the
INVESTMENT ADVISORY
and shall be called
inde¬
an
pendent certified accountant or
independent
public
accountant
based
by
or
beneficial
or
be called by
may
not less than
(4) REPORTS.
covered
holders,
Thursday, December 28, 1961
the
of
value
market
fair
...
CONTRACT.
(11)
Special meetings of the share¬
of
delictu;
ex
Chronicle
The Commercial and Financial
132
Recorder
County
where the prin¬
cipal business of the trust is
located and in any other county
the country
in
where
property of the trust is
located.
m
Report of IB A Foreign
Continued from page
sale
Bank
broaden the fa¬
designed to
are
cilities available to United States
exporters on short and mediumterm transactions (usually up to
but up to seven years
aircraft). Both plans en¬
the exporter to deal di¬
five years,
for
jet
courage
with his private commer¬
rectly
brrk.
cial
New
based on a
new
private Insurance Associa¬
tion, organized and owned by pri¬
vate insurance companies, which
will be backed up by the Exportfirst
is
plan
Import Bank. Comprehensive in¬
surance policies will be issued by
this
Association
through insur¬
ance
agents all over the country,
a
risk guaranty with re¬
spect to the first one-half of the
instalments of a 1 or 2 year credit,
or the
first 18 months of instal¬
ments of
3, 4
a
5 year credit.
or
The later maturities will be fully
against both political
and commercial risks by Exim¬
bank and should be readily sale¬
able to other commercial banks,
guaranteed
or
companies,
This
investors.
other
as
for
collateral
debentures
of
ance
issu¬
the
financial
by
institutions.
These
AID and
Export-Import Bank are an inter¬
esting
important
potentially
and
opinion in encourag¬
step in
our
ing
broader
a
of
programs
participation
by
private institutions i;n the field of
the
foreign investment. They open up
risks, and to
extent of 90% or 95% on his
or
commercial
The
risks.
litical
and
Bank
po¬
Export-Import
a
new
of
field
activity
tion will be co-insurers to the ex¬
and Eximbank will be the
risks,
sole
insurer
with
risks.
litical
'
offers such
a
an
exporter
is
obviously
en¬
The second
the
plan is designed for
and
exporters
not
banks
who
of
insurance
an
case,
do
commercial
feel
policy.
the
In
need
this
the exporter retains 15% ot
World
The
other
Bank
agencies
possibilities
studying
problems
are
investment
tional
certain
and
and
forming
in
volved
the
in¬
interna¬
an
insurance
cor¬
poration which would provide on
international
an
for
insurance
basis
zens.
■
The World Bank has also taken
lead
the
exploring the possi¬
establishing a special
forum for the conciliation or arbi¬
of
tration
of
tween
financial
disputes
be¬
private parties and govern¬
This
ments.
study
the request
initiated
was
of certain member
governments in view of the need
such
for
machinery
the
and
which the World
perience
ex¬
Bank
worth noting.
are
Bonds
The
Inter
ment Bank
-
in
U.
rate
to
it
will be
in
the
is
work
now
a
our
Offer
S.
American
is
now
it
to
Develop¬
fully opera¬
and
the
putting its capital
appears
likely that it
offering its bonds for sale
market
next year.
sometime
within
of
this
of
what
Inter-American Bank
is
our
today
only
the
in
are
still
member
United
believe
We
because
engaged
in
the
to
small part
those
United
COMMITTEE
Arthur
to
tap
Political
Lazard
few
are
of
our
actively
investment.
foreign
worthwhile
States
invest¬
Freres
New Ydrk,
Co.
&
N. Y.
observ-" 'Robert H. Craft
'Paribas Corp.
nations"
New
of
York, N. Y.
Maurits E. Edersheim
boundaries
New
York, N. Y.
and Walter
businessmen
/
Burnham & Co.
already lost much of their
to
Chairman
Eugene R. Black, Jr.
expanding inter¬
the
Wadsworth.,
Dillon, Read & Co., Inc.
New York, N. Y.
r
worthwhile
help
L.
A.
Everitt
bankers within the Common Mar¬
Model, Roland & Stone
ket.
New
in
Convertible
existence
and
currencies
now
increasing
dis¬
cussion of the need for closer
policy
between
the
leading
co¬
to
increasing
an
of
private
international
potential
the
market
Free
mendous.
will
be
cap¬
is
World.
by
ers
it
Milwaukee, Wis.
as
New
Morgan
appreciation
and
the
of
our
of
IBA
staff
Irving II. Sherman
A.
leading
G.
New
i
'
Henry
Becker
&
Co., Inc.
York, N. Y.
Stravitz
Swiss American
express my
thanks
to
the
Committee
and
for
Guaranty Trust Co.
York, N. Y.
New
"foreign investment."
members
York, N. Y.
Clifford R. Rohrberg
role in this expanding market for
closing I want to
of America N.T. & S.A.
New
they will
a
Corp.
York, N. Y.
Bank
in the United States will "find
play
Overby
Henry A. J. Ralph
We believe investment bank¬
to
N.
The First Boston
The
for the service they ren¬
worthwhile"
Corp.
L. Hutchinson, Jr.
Andrew
investment
bankers somewhere and
Hanseatic
The Milwaukee Co.
The flow of this capital
managed
York, N. Y.
Joseph T. Johnson
investment
■&
as
York
New
Mitchum, Jones & Templeton
San Francisco, Calif.
ital between the various financial
markets.
New
Wm. N.
in¬
dustrial nations all point the way
flow
York, N. Y.
Kurt II. Grunebaum
ordination of trade and monetary
In
is
is
it
between
importance
der.
There
question is frequently raised
field
is
+
cannot
world.
have
The
activi¬
relate
We believe work in the
for
we
finance
"Is it worthwhile?"
investment
it
dependence in business, trade and
States.
foreign
Respectfully submitted,
devel¬
and
products
ing the rapidly
be paid
who
research
to
opment of new
markets.
Knowieage
reason
same
new
banking busi¬
relatively
firms
a
believe
the
ana
rime
FOREIGN INVESTMENT
existing demand for funds is tre¬
the
Committee
investment
ness
The
that
recognize
We
for
oi
work this year.
and
progressive industrial cor¬
devote a portion of its
a
resources
has already had in this field.
Conclusion
activities
poration
in
bilities
at
that
foreign
ties
tional lending agency,
hanced.
with
connection
in
the distribution of such securities.
agencies several developments
policy to his bank as
financing
portion
commitments
We
collateral, his opportunity to ob¬
tain
business.
worthwhile
a
their
our
devote a portion of
their work to the development of
this
foreign markets by
private bankers on
of their underwriting
Among the international finan¬
cial
in
iriDuuon
to
to
backstopping
.
respect to po¬
When
sification
patience
broad
ers.
with respect to credit
both
for
commercial and investment bank¬
the Insurance Associa¬
tent of 50%
the United States market
banking firms with suffi¬
background training, diver¬
and im certain
fully guaranteed paper could also
serve
the^ public or private
equity securities
foreign
investments such as
that now offered by the govern¬
ments of the United States, Japan
pension and Germany for their own citi¬
policies to cover the exporter
the extent of 85% on his credit
the
to
Eximbank
from
obtain
then
of
both in
political
funds
Protection
The
The commercial banks may
risks.
insurance
Insurance
Private
commercial
both the political and
21
by the Export-Import
of Washington. Both plans
ment
cient
it facilitate
Investment Committee
announced
The International Finance Cor¬
poration is studying proposals that
their
New
Corp.
York, N. Y."
J. Emerson Thors
con-
'
Kuhn, Loeb & Co.
New
York, N. Y.
Volume 194
Number 6120
figures
primarily
reflect:
(1)
foreign securities by U. S. in¬
foreign investors; (2) redemp¬
tion of foreign
securities, either in the
O. S. or abroad; and
(3) purchases for '
sinking fund purposes.
P. Tsolainos
Baker, Weeks
1119995543460678
7
Co.
&
the
H.
as
include
the
branches and subsidiaries abrcad
foreign
companies.
The
or
ac¬
customers.
and
the
within
U.
individuals
S.
and
its
all
covers
domiciled
territories
and
possessions, with the exception of the
following: (1) branches or agencies of
foreign central banks; (2) other official
institutions of foreign countries; and (3)
international organizations.
with
statistics
APPENDIX A
APPENDIX A
of
Foreign
Stocks
By U. S. Investors
($ Millions)
PURCHASES
Country of seller
Europe—
**
Purchases
*
$65.6
$0.4
42.6
—14.6
SECURITIES
BY
U.
-Gross Purchases
Bonds
96.7
15.0
—18.0
198.2
24.4
348.7
76.4
329.6
303.4
—6.8
644.9
251.6
Bonds
Stocks
$1,290
$36
$1,326
$—210
$13
$—197
5,059
922
—14,385
386
16,407
2,360
—15,307
1,974
—492
315
—177
France
Germany
3,299
23
3,322
—3,305
23
—3,282
10,507
25,951
36,458
—14,531
4,206
—10,325
60,322
32,793
93,115
24,056
635
583
1,564
16,878
2,147
17,628
981
750
—39,485
12,517
—26,968
Netherlands
20,570
155,997
176,567
—263
87,906
87,643
Norway
18,267
564
18,831
7,666
—847
1,009
155
1,164
—293
—121
—414
427
190
617
—1,432
23
—1,409
9,030
92,245
1,389
10,419
139,165
6,618
46,920
—441
—11,889
6,312
—5,271
5,871
_
_
1,512
__
Italy
Portugal
Spain
_
877.9
214.3
Sweden
875.2
126.1
Switzerland
"
•
17,674
'
621.9
29.1
803.7
336.4
1959
803.8
237.7
I960-
591.7
82.6
1958.
Turkey
Other
of
amount
credited
to
U.
data
above
S.
transactions
Europe
16
—5
—97
137,278
43,531
—42,147
1,384
413
59,572
35,025
—186
34,839
$369,862
$345,497
$716,392
$42,113
$75,207
$117,320
—
—
Latin
to
the
as
America
Asia
the
debited
money
$490.4
—$265.5
—
634.3
—24.5
291.4
79.8
311.5
—9.8
710.2
121.0
801.0
300.6
677.4
182.1
621.5
79.0
841.3
48.8
509.4
—183.9
991.5
385.0
1,915.1
1,457.6
1,445.0
$710.4
I960—
Jan.-Aug. 1961
Source: Treasury
Other
or
countries
International
result
foreign securities, in¬
securities.
The gross
cluding Canadian
purchases, figures reflect both new and
outstanding issues.
The differences be¬
tween the gross purchases and net pur¬
Grand
Total
Source:
$197,826
$616,783
$209,738
42,189
203,128
83,224
76,100
4,136
80,236
39,874
61,814
1,864
63,678
39,313
—2,869
36,444
356,456
4
356,460
147,831
—785
147,046
$1,444,986
$591,691
$2,036,677
$—13,889
$195,84<>
24,207
107,431
753
40,627
-
$562,093
$82,624
$644,717
Treasury Department.
Gross
Net
Purchases
Purchases
„
$556.1
—$261.1
676.8
—_
—39.0
388.2
94.8
382.3
—27.8
908.4
145.4
1,149.7
1,007.0
377.0
217.9
924.9
1954_
72.2
1,486.1
1,387.3
1,866.8
2,014.0
.
<
300.4
■
30.4
511.1
722.1
1,362.5
749.7
—
644.7
$517.5
Source: Treasury Bulletin
Bulletin
APPENDIX C
AGENDA—Meeting of the Washington Subcommittee
IBA
FOREIGN
12:30 p.m.
INVESTMENT
Luncheon—at which Mr. Fowl¬
COMMITTEE
4
—102
$418,957
160,939
1119995553762
60
($ Millions)
Year
693.1
1,026.1 1958..
2,718.8
2,261.5
512.0
562.1
2,036.7
$320.7 Jan.-Aug. 1961 $1,290.7
1,392.0
Hamilton, Administrator for
Agency for International De¬
velopment, will be our guest.
er
Washington, D. C.
the
Nov. 15, 1961
Meeting at
Canada
related
Accounts
in
16
58,267
59,159
Net
Purchases
10:00
Total
Source: Treasury Bulletin
The
Kingdom
Europe
119955876423
Gross
Purchases
1949—
11199954417086
Purchases of all Foreign
Securities by U. S. Investors
($ Millions)
,
Year
APPENDIX A
Total
By U. S. Investors
6,819
79,011
—
United
41,730
$196.7
Jan.-Aug. 1961 $580.5
NOTE:
Total
11,348
Finland
35.8
Total
Belgium
Denmark
70.8
-Net Purchases
Stocks
1119995440678
APPENDIX A
Purchases of Foreign Bonds
1955—
INVESTORS—1960
S.
Austria
Greece
1955.
FOREIGN
($ thousands)
Net
Purchases
1952_„
OF
^
Gross
Year
total
parent
,
of
account
term."U. S. Investors"
institutions
inter-company account transactions
of
U. S. non-banking firms with their own
York, N. Y.
the
own
therefore,
The
Bank.) They
foreign investment
nor do they cover
New
for
their
for
do not cover transac¬
tions carried out entirely abroad in which
a
reporting institution is not involved.
World
direct
by U. S. corporations,
foreigners
and
They,
transactions
in
international organiza¬
of
with
count
securities
Morgan Stanley & Co.
Purchases
of
such
not
only
cover
tions
(including
securities
tions,
do
York, N. Y.
John M. Young
•V.-1
statistics
transactions
Walker, Jr.
G. H. Walker & Co.
New
to
The
York, N. Y.
133
are
based
on
monthly reports to the
Treasury Department by banks and se¬
curity dealers and brokers on transac¬
of
vestors
Pittsburgh, Pa.
George
The Commercial and Financial Chronicle
.
sales
Thomas & Co.
New
.
chases
Anthony E. Tomasic
K.
.
a.m.
2:15 p.m.
the
Treasury, with
Mr. Robert V. Roosa, Under Sec¬
retary for Monetary Affairs.
11:15
a.m.
Meeting
Finance
at
the
.
International
Corporation,
with
Mr.
Martin M. Rosen, Executive VicePresident.
3:30 p.m.
Meeting at the Inter-American
Development JBank, with Mr. Fe¬
lipe Herrera^President, Mr. T.
Graydon Upton, Executive Vice-
Meeting at the Export-Import
Bank, with Mr. Harold F. Linder,
President, et al.
James
President and
Chairman, and Mr.
S. Bush, Director, et al.
Appendix B
Foreign Dollar Bond
Offerings
=~~'
"
(1956-1961 inclusive)
11-14-61
>traent Bankers)
(Offered by Invest
RLD
Aggregate
of
Amount
Public
Concurrently
Offered
Issuer
Year
Amount
($000)
Public
Public
Offering
Short
Date
of
Date
of
Payment
Date
of
Offering
■
Term
Debt
Term
Coupon
Bonds
Maturity
Clause
Probpectus
Price
Offering
Yield to
World Bank
Maturity
Financing
($000)
($000)
*
1956
Commonwealth of Australia
I
1957
Total
Commonwealth
of
&
Steel
European
•
Community
Union
of
South
Africa
City of Amsterdam
The Belgian Congo
Commonwealth
of
Australia
(Norway)
City of Oslo
Federation
51
of
Rhodesia
High Authority of the
Coal
4
1/2$
6-15-56
6-15-71
3-1-57
Dollars
6-20-56
3-1-72
Dollars
3-13-57
100
98 1/2
4.69$
None
20,000
None
25,000
10;000
30,000
None
75,000
10,000
15 yrs
18
yrs
5
15 yrs
5
1/2
1/2
4-1-57
4-1-75
Dollars
4-9-57
100
5.00
None
9-1-57
9-1-72
Dollars
9-10-57
97
1/2
1/4
1/4
3/4
1/2
3/4
1-1-58
3-1-58
4-1-58
5-1-58
6-1-58
5-1-58
1-20-58
2-27-58
5.50
1/2
5.75
None'
50,000
^
'
Totals
1958
15 yrs
~
Kingdom of Belgium
.•
None
25,000
Australia
High Authority of the
Coal
25,000
Concurrent
&
Steel
&
Nyasaland
15,000
None
10
15,000
None
15 yrs
15,000
None
15 yrs
25,000
Norie
15
8,000
6,000
3,000
15 yrs
None
15 yrs
15,000
17,500
None
16,800
Commonwealth
25,000
Republic
of
Australia
New
Dollars
Dollars
4-1-73
Dollars
5-1-73
Dollars
6-1-73
Dollars
5-1-73
Dollars
4-15-58
4-22-58
5-28-58
6-16-58
98 1/2
.
99
98 1/2
99
97
97
"
1/2
1/2
5.69
None
til
None
4.84
None
5.75
6.00
19,000
None
None
w
Community
35,000
of
yrs
1-1-68
3-1-73
European
Kingdom of Norway
Republic of Panama
Government
yrs
Zealand
of Austria
20
yrs
5
5
None
15 yrs
40 yrs
4.80
7-1-58
10-1-58
11-1-58
11-1-58
12-1-58
12-1-58
'
1/4
None
20
yrs
5
10,000
None
12
yrs
25,000
None
15 yrs,
1/2
5 1/2
.
5
7-1-78
Dollars
10-I-73
Dollars
11-1-98
11-1-78
Dollars
12-1-70
Dollars
12-1-73
[Dollars
Dollars
6-24-58
9-23-58
10-21-58
10-22-58
H-19-58
12-3-58
97
5.20
None
98
5.45
4.73
None
101.17
97 1/2
None
5.20
None
99
5.62
None
96
5.91
25,000
5.70
25,000
1/2
5.75
20,000
5.70
6.22
10,000
1/2
kAustrian Schillings
Pounds
(W.
Union
of
South
Africa
10,000
Totals
1959
223.300
Kingdom of Denmark
Government
of
Jamaica
KLM
Royal Dutch Airlines
Southern Italy Development
Fund
Montecatini
Commonwealth
of
Foncier
Australia
de
France
Totals
i960
*
10
yrs.
5 1/2
German Marks
12-1-58
12-1-68
Dollars
Dollars
2-5-59
97
Dollars
2-17-59
98
3-1-59
2-1-74
1-15-74
3-1-74
Dollars
2-25-59
95
3-1-59
3-1-79
Dollars
3-10-59
100'
5-1-59
5-1-74
Dollars
97
12-2-58
98 1/2
_
32zP0Q
20,000
None
15 yrs.
1/2
2-1-59
15,000
15,000
15 yrs.
1-15-59
10,000
2,500
15 yrs.
18,500
None
20,000
10,000
1/2
3/4
3/4
1/2
1/2
•
Japan
Credit
15,000
20
yrs.
15 yrs.
„
10,000
None
6-15-79
Dollars
25,000
None
20
yrs.
1/2
9-15-59
9-15-79
Dollars
50,000
None
20
yrs.
1/2
12-15-59
12.15-79
Dollars
4-21-59
6-30-59
9-16-59
12-8-59
168,500
27,500
4-15-60
6-15-60
4-15-80
Dollars
(Dollars
20
yrs.
6-15-59
None
4.75
None
20,000
100
5.75
5.50
97
5.75
None
5.89
None
1/2
None
95
1/2
4-19-60
97
1/2
99
5.46
5.85
None
6-21-60
Commonwealth
of-Australia
25,000
None
20
yrs.
5
1/4
City of Oslo
(Norway)
10,000
None
15 yrs.
5
3/4
Commonwealth
of
25,000
None
20
yrs,
5
1/4
10-1-60
10-1-80
Dollars
9-28-60
98
5.46
None
10,000
20
yrs.
5
3/8
10-15-60
10-15-80
Dollars
10-18-60
97
5.63
None
15 yrs.
5 1/2
5-1-61
5-1-76
Dollars
5-2-61
97
1/2
5.75
None
4-15-61
7-1-61
10-15-61
10-15-61
4-15-76
Dollars
95
1/2
6.47
None
97
5.75
None
•
(Pounds
Australia
;
None
V
High Authority of the European
Coal
&
Steel
Community
25,000
10,000
Totals
1961
.Kingdom of Norway
Nippon Telegraph & Telephone
Public Corporation
Commonwealth
of
Australia
Japan Development Bank
Government
of
New Zealand
Totals
18,000
None
15,000
5,000
15
yrs.
6
25,000
None
20
yrs.
5
15,000
5,000
15
20,000
None
10,000
1/2
yrs.
15s yrs.
5
3/4
7-1-81
Dollars
10-15-76
Dollars
5-2-61
6-27-61
10-3-61
95
1/2
6.47
None
10-15-76
Dollars
10-24-61
97
1/2
6.00
None
134
The Commercial and Financial Chronicle
ROSTER
Page
OF
ADVERTISERS
Page
ALABAMA
Page
INDIANA
BIRMINGHAM
NEW
INDIANAPOLIS
Perry (Berney) & Co., Inc
Sterne, Agee & Leach
Stubbs, Watkins & Lombardo,
120
City
Inc.
120
82
Long
(Hugh W.)
&
Fenn
Pitfield
(W.
Pollock
Qo., Inc.
55
82
Co
40
C.) & Co., Inc
(Wm. E.) & Co., Inc
52
Rand
&
82
(The)
IOWA
State
(R. W.)
&
Bank
58
TRENTON
LOS
ANGELES
Harbison
Hill
&
CEDAR
Inc.
Richards
Co., Inc
& Co.
(William R.)
Stern,
Frank,
&
Brothers
Barth
(J.)
&
&
Co.
42
9
Fox
Bankers
Co.
Sutro
& Youngberg
& Co
Wells
Fargo
Trust
&
NEW
Co.
93
Co.
113
i
Hattier
103
NEW
YORK
&
Sanford
Friedrichs
99
117
Co
&
Doolittle
&
Newman, Brown & Co., Inc.
& Jones, Inc.
117
102
117
SHREVEPORT
Co.
NEW
117
Scharff
Bank American
101
Wilson, Johnson & Higgins
Witter (Dean) & Co.
Barrow, Leary & Co
103
117
99
MARYLAND
COLORADO
YORK
Baker, Watts & Co
Brown (Alex.) & Sons
104
CONNECTICUT
Garrett
«>
HARTFORD
(Robert)
&
119
118
Sons
1196
Legg (John C.) & Co,
Mead, Miller & Co
Stein Bros. & Boyce_
Williams (C. T.) & Co., Inc.____
119
119
118
118
Allen & Co
Ames
&
54
Co.
& Co., Inc.
Bache
46
—
Bleichroeder, Inc.
MASSACHUSETTS
BOSTON
Scranton
(Chas. W.)
DISTRICT
& Co.
58
COLUMBIA
OF
WASHINGTON
Bank
122
122
122
122
(C.
New
Discount
&
Co., Ltd.
Life
Fund
Schirmer, Atherton & Co.
State
Street
Bank
&
Co.
'Corp
Dillon, Union Securities
Co
34
of
Michigan Corp
First (The) National City Bank
New
Frank
"
York..
(P. F.)
&
MICHIGAN
BEACH
Fund
JACKSONVILLE
Atlantic
National Bank
(The)
Baker, Simonds & Co., Inc.
72
McDonald-Moore
72
Parcells
v
of
DETROIT
121
Jacksonville
121
Pierce, Carrison, Wulbern, Inc.—
(Charles A.)
&
Co.
Watling, Lerchen & Co
(Oscar E.) & Co
Co., Inc
ORLANDO
Le.edy, Wheeler & Alleman, Inc._
121
Co.—
&
Courts
32
114
Johnson, Lane, Space & Co., Inc.
Robinson-Humphrey (The) Co.,
114
Inc.
Bank
of
'
Hopwood
&
ST.
127
Hutton
Wood
126
(Harold E.)
&
Co._
„
MISSISSIPPI
115
30
24
Co.__
33
34
56
Kenny (J. J.) Co.
King (Charles)
Co
Cady
&
Co.,
Inc.
120
Allyn (A. C.)
American
81
& Simmons
Illinois
Trust
National
Bank
&
Investments
of
Renshaw
(H. C.)
Stifel, Nicolaus
Straus, Blosser
&
Sons
Co.
Co., Inc
McDowell__^_
Television Shares Management
Corporation
Stern
123
& Co.
Co.,
Brothers
&
123
Co
123
ST.
76
74
76
79
(Edward D.) &
Mercantile Trust Co.
Newhard, Cook & Co
Richter Company
Scherck.
Simon
(I. M.)
Walker (G. H.)
124
j.
80
Co.
&
&
Co.,
Merrill
125
Midland
Morton
Inc.
(Peter)
(W. H.)
Corp._^
124
103
111
111
«•_
Company, Inc.
111
109
UTAH
Hogle (J. A.)
LAKE
&
CITY
Co
104
87
Co
84
VIRGINIA
CHARLOTTESVILLE
83
Cassell (C. F.)
&
Co., Inc
128
LYNCHBURG
87
&
Co., Inc
&
129
RICHMOND
Abbott, Proctor
Craigie (F. W.)
National Bank of
&
Paine
&
Co
Scott
&
Wheat
129
131
Mason-Hagan, Inc.
I
129
Stringfellow
(J. C.)
&
128
Co.
131
105
McFaul
:
:•
105
WASHINGTON
PENNSYLVANIA
SEATTLE
PHILADELPHIA
&
Co.
&
&
De Haven
Seattle-First National Bank
Co.
65
Sherrerd
&
49
47
42
Corp.
Co., Ltd.
23
44
51
Pershing
30
WISCONSIN
61
MILWAUKEE
Townsend, Crouter
Bodine
&
Co.
Elkins, Morris, Stokes & Co
62
Baird
61
Loewi
(Robert W.)
&
Co.,
Inc.
&
Co., Inc
131
131
CANADA
62
Colket
&
Inc
60
Janney, Battles & E. W. Clark,
Newburger & Company
Penington,
104
63
^
Co.^
61
65
WINNIPEG,
Richardson
Philadelphia (The) National
Bank
60
(James)
MAN.
&
*
Sons
48
TORONTO, ONT.
Rambo, Close & Kerner, Inc
65
Schaffer, Necker & Co
64
Gairdner
Schmidt, Rob efts
65
Harris
63
Mason & Crysdale Limited.^
Mills, Spence & Co. Limited
51
64
Walwyn, Stodgell
52
Sparks
(J.
W.)
&
&
Parke
Co.
Research
Securities
Co.
(The)
Oregon
15
Nomura Securities Co., Ltd
&
First
Hess
&
57
Hanseatic
(The)
Co
91
105
Drexel
31
& Co., Inc.
&
&
87
43
26
Co.
&
Securities
OMAHA
Chiles-Schutz Co.
&
H.)
86
:
Inc.
Butcher
22
Canadian
York
Nikko
Russ
PORTLAND
Boenning
41
Corporation
New
91
(E.
85
Blankenship, Gould & Blakely,
11
36
(John J.) & Co.
National
NEBRASKA
85
Dittmar &
Company, Inc.L_
Funk, Hobbs & Hart, Inc
Lentz, Newton & Co
Strader
44
Lynch, Pierce, Fenner
Smith
Morgan
80
126
Inc.
McLeod, Young, Weir, Inc.
Model, Roland & Stone
& Co
Austin
91
OREGON
Bioren
28
125
54
74
Co., Inc.
124
124
j
Butler, Wick & Co
36
14
125
:
Co
&
Mabon
Meyers
Co.
Inc
(Carl M.), Rhoades & Co..
&
LOUIS
89
86
YOUNGSTOWN
36
—
Corp
(D. E.)&
54
ANTONIO
32
Brothers.
McDonnell
Purcell, Inc.
Jones
74
Co.
&
&
Trust Co.
Parker/Eisen/Waeckerle/Adams
78
Securities Co. of Chicago
McDougal & Condon, Inc.
Mullaney, Wells & Co
Northern
(The) Trust Co
Rodman
Loeb
CITY
73
75
Selected
Commerce
&
First
Speer
74
77
Cruttenden, Podesta & Co.
(Ralph W.) & Co
(The)
Chicago
KANSAS
81
National
Co.
Davis
First
&
Liederman
Blunt Ellis
&
MISSOURI
79
78
Bank
Lehman
Bank and
Trust Company
Bacon, Whipple & Co
Becker (A. G.) & Co., Inc—4
Continental
Lebenthal
Lee Higginson
& Co
National
Inc.
Dayton Power and Light Co.
23
Langley (W. C.) & Co.
CHICAGO
SAN
37
&
Laird, Bissell & Meeds
COLUMBUS
ILLINOIS
Co.„:
Texas Fund Management Co
DAYTON
21
Snyder
I^eabody
113
26
Anthony & Co., Inc.__:
Kidder,
H5
Trust Company of Georgia
James
of
91
36
Co
&
108
Eddleman, Pollok & Fosdick, Inc. 113
Fridley & Frederking
ill
Rowles, Winston & Co
113
.
45
&
(W. E.)
Ingalls &
126
86
.
(The) Company
Sweney Cartwright &
41
45
107
108
Worth
84
Ohio
20
Weeks
&
(E. F.)
Hutton
27
Inc.
Co
&
Hornblower
Shaughnessy & Co., Inc.
Fort
107
108
WORTH
Bank
COLUMBUS
17
26
Co
&
127
PAUL
National
111
109
89
Corp
Inc#?
Co.,
Co.
53
38
National
114
French & Crawford, Inc.
Inc.
Hirsch
115
& Co., Inc._
(Clement A.)
Evans
(N. Y.)
127
Minneapolis
ATLANTA
Co.
Hill, Darlington & Grimm
Hill (Malvern) & Co., Inc.
Minneapolis
Piper, Jaffray
First
SALT
38
Hettleman
of
&
&
Prescott &
28
126
Bank
Reid
McDonald
18
126
National
Cleveland
43
127
Northwestern
GEORGIA
Gibbons (Geo. B.) & Co., Inc
Goodbody & Co.
Granbery, Mache & Co.'
Greene & Company
&
&
103
88
89
Saunders, Stiver & Co.__.
Dain
First
88
84
Mericka (Wm. J.) & Co., Inc—
Merrill, Turben & Co., Inc._
Murch & Co., Inc.
.*
38
Allison-Williams
Company
Bishop (M. H.)„ & Co.
(J. M.) & Co., Inc.
Perkins
54
Greenshields
MINNEAPOLIS
(The)
Fulton,
11
Gregory & Sons
Halle & Stieglitz
Hallgarten & Co
Harriman Ripley & Co., Inc
Hatch (Frederic H.) & Co.,
Hay, Fales & Co
Hemphill. Noyes & Co.
Hentz (H.) & Co._
121
86
1
Hayden, Miller & C".
Joseph, Mellen & Miller,
{Research & Management,
72
MINNESOTA
McKinney, Inc.
Eppler, Guerin & Turner, Inc.
First Southwest
Company
Parker, Ford & Co.j Inc
FORT
Co.
Ginther & Co
24
44
72
121
MIAMI
Dooly
Co.
&
First
(Albert)-Guenther Law,
Inc.
O'Rourke, Inc., T. Nelson
&
CLEVELAND
13
Inc.
DAYTONA
116
Almon
Co., Inov
Rauscher, Pierce & Co., Inc
Sanders & Company
Walker, Austin & Waggener
Burge & Kraus
Cleveland (The) Trust
Curtiss, House & Co._
Field, Richards & Co.
39
First
of
Corp
Ball,
21
Co.
56
Fox
H6
HOUSTON
47
.
35
68
Memphis
CINCINNATI"
25
Emanuel, Deetjen & Co
Faulker, Dawkins & Sullivan
(The) Boston Corporation
70
National Bank of
37
First
69
Trust
116
(The) Bank
Walter, Woody & Heimerdinger_
Westheimer & Company
;
32
69
57
116
TEXAS
Provident
42
Co..
Co.—
&
First (The)
CAROLINA
Securities
3
Securities
(F.)
58
OHIO
12
&
Co.
30
Dominion
&
Carolina
29
Cullom)
&
RALEIGH
45
70
Eastman
Co., Inc.__
MEMPHIS
(McDaniel) & Co
46
Corp. of New York
Group, Inc.
Eberstadt
G.)
TENNESSEE
43
'SSi
Coffin & Burr
Distributors, Inc.
(Alester
51
DALLAS
Lewis
39
55
National Shawmut Bank of Boston
Putnam Fund Distributors, Inc.
Furman
31
40
49
57
26
&
NORTH
40
& Dominick
63
Co
5
Dominick
71
35
&
Beane
(George D. B.)
York
Securities
J.)
CAROLINA
GREENVILLE
GREENSBORO
45
Distributors
Townsend, Dabney & Tyson
FLORIDA
(The)
(Shelby
Bonbright
27
70
Draper, Sears & Co.
& Howard, Inc.
& Hill, Inc
SOUTH
35
56
Harkness
38
33
52
Chase Distributors Corp.
Clayton Securities Corp.
Massachusetts
Birely & Company^
j
Folger, Nolan, FlemingW. B. Hibbs & Co., Inc
Johnston, Lemon & Co.
Jones, Kreeger & Co
Daiwa
Davis
Devine
Eaton
Inc.
Co., Inc.
Yamaichi Securities Co., of
New York,
Inc.
29
Bacon, Stevenson & Co
Bear, Stearns & Co
Bell, Gouinlock & Co., Inc.
Blair & Co., Inc.
Blyth & Co., Inc.
Boland, Saffin, Gordon & Sautter
Braun, Bosworth & Co., Inc.
Briggs, Schaedle & Co., Inc._
Bullock, Ltd., Calvin_
Burnham & Company
Burns Bros. & Denton, Inc
Central National Corporation
Chase Manhattan Bank—
Chemical
71
16
Co.__.
&
of
35
41
—
Clark, Dodge & Co., Inc.
NEW HAVEN
&
Bank
Inside Back Cover
s>.
( A. E.)
Trust Company
Putnam
Gundy
National
Island
Cover
20
R.)
ISLAND
CITY
„
BALTIMORE
DENVER
Coughlin & Co., Inc.
Industrial
Rhode
Front
Co.
(J.
64
PROVIDENCE
ROCHESTER
Arnhold & S.
«
58
Asiel & Co
_
45
Alstyne, Noel & Co.
Ingen (B. J.) & Co.,
Vilas & Hickey
Williston
66
19
;
White, Weld & Co
Wiesenberger (Arthur)
BUFFALO
ORLEANS
Howard, Weil, Labouisse,
103
103
v
Co
Van
&
67
64
T
30
Van
Quinn &
Wood,
101
Co
RHODE
34
40
Inside
93
66
10
Co
(Spencer) &
Tripp & Co., Inc
MEXICO
67
67
25
& Co
ALBUQUERQUE
93
LOUISIANA
102
98
101
2
&
(W. L.)
99
Co., Inc
Gorey (Walter C.) Co.^__
Lawson, Levy, Williams & Stern
Schwabacher
(The) Bond Co,
(J. J. B.) & Son
Back Cover
:
&
(H. J.) & Co.
Thomas & Company
Troster, Singer & Co.
Lyons
Co
S.)
41
McKinnon
Trask
NEW
LOUISVILLE
97
First California
Stone
&
(J. R.)
Wertheim
Co
&
(F.
Thomson
66
Masten
Steele
43
:
Kay, Richards & Co.
35
45
Shearson, Hammill & Co.
& Company
Shore (Harold C.) & Co., Inc.
Singer, Bean & Mackie, Inc.
Smith, Barney & Co.
66
22
(G. A.) & Co., Inc.
Schapiro (M. A.) & Co., Inc.
Saxton
67
Humphrey,
&
Inc.
(A. E.) & Company
McKelvy & Company
Moore, Leonard & Lynch
Reed, Lear & Co.
Simpson, Emery & Co., Inc
19
Timmins
95
Brush, Slocumb & Co. Inc.
Crocker-Anglo National
Bank__
Denault
59
Pulme, Applegate
Hutzler
Srrtithers
Hilliard
Bank of America,
N. T. & S. A
59
Suburban Propane Gas Corp.
FRANCISCO
SAN
Company
WHIPPANY
83
KENTUCKY
94
95
*
& Co
Meyer
Trenton Trust
RAPIDS
Light & Power Co.
97
97
&
Staats
Electric
97
Henderspn
Lester, Ryons
Iowa
97
Chaplin, McGuiness & Co.
18
42
Shields
Bateman, Eichler & Co._*
Bingham, Walter & Hurry,
Crowell, Weedon & Co.
Page
PITTSBURGH
39.
Co.
Co.
Salomon
National
&
Registrar and Transfer
Reynolds & Co
NEWARK
Inc.
CALIFORNIA
Page
Phelps,
Pressprich
Corporation.
Indianapolis Bond & Share Corp.
Raffensperger, Hughes & Co.,
120
JERSEY
ELIZABETH
Securities
Thursday, December 28, 1961
.
.
.
Taggart (Charles A.)
&
Co., Inc.
Warner, Jennings, Mandel
Longstreth
Wellington
Company, Inc
Woodcock, Moyer, Fricke &
French, Inc.
Equitable Securities
&
&
Canada
Ltd.
53
Limited__
Limited-
50
Company
Partners
&
Co.
Limited
50
50
&
MONTREAL, QUE.
63
57
62
Beaubien
(L. G.) & Co., Limited
Collier, Norris & Quintan, Ltd.
Securities Corp., Ltd
Royal
53
52
48
Volume
194
Number 6120
.
.
The Commercial and Financial Chronicle
.
The face of America
1
135
is
constantly changing. .;
Company is proud to play a part in
creating many of those changes, tp the benefit of
and Allen &
the citizens of the communities concerned.
From great
Oklahoma
highway
...
to a
systems in Kentucky and in
mighty bridge-and-tunnel com¬
plex traversing the
from power
to
waters, of Chesapeake Bay
projects in the State of Washington
.
extensive
marina
harboring Florida's
ever-growing fleet of pleasure craft... from a
bridge in Michigan to airport facilities in Okla¬
...
an
homa
rate
but-
constructions of
many kirfds, widely sepa¬
geographically and dissimilar in many ways,
having one thing in common:
«
...
All have
profited from creative new financing
formulas, derived from Allen 8c
Company's
long experience and soundly-based revenue
financing theories.
Allen 8c
Company acted
as manager or co-manager
of the bond
syndicates that financed all of the great
construction
projects mentioned or pictured .. .
and in
every instance, Allen 8c Company assisted in
origination and planning. Our proven
knowledge of tax-exempt bond financing has been
their
useful
to
governmental subdivisions throughout
the United States, in
arranging, underwriting, and
distributing such bond issues.
*
We here
are
several
projects financed through syndicates
by Alien & Company:
Chesapeake Bay Bridge and Tunnel District
■
Mackinac Bridge
Authority
■
The Turnpike Authority of Kentucky
■
Oklahoma
Turnpike Authority ■ Bahia Mar Marina, Florida ■ Clark County,
Washington P.U.D's
Listed below
are
a
few of the
many other Revenue Bond
Issues
by Allen & Company:
South
San
Joaquin Cal.
Water Control
Dist.
No.
Irr.
1
Dist.
■
■
Maricopa County Arizona
East St.
Louis Bridge, Illinois
■
Long Beach Sewage Authority, New Jersey
■
Long Branch, New
Jersey Sewage Authority ■ Triborough Bridge & Tunnel
Authority
■
Pennsylvania Housing Authority (Various)
■
Nueces County
Capseway, Texas ■ Chelan P.D. No. 1, Washington ■ Wisconsin
Housing Authority (Various) ■ Greater New Orleans
Expressway
qAllen
s
&
Company
Established 1922.
'
at
record of
across
Illustrated here
headed
Allen 8c
Company are grateful that our
accomplishment continues to grow—all
America.
•
.
'
New York
4, New York
STATE, MUNICIPAL AND REVENUE BONDS
The Commercial and
Financial Chronicle
.
.
.
Thursday, December 28, 1961
Projecting the California high standard of life into the future
All
over
going
California, hundreds of
up to
house
communities
ties for the
sound
are
new
new
new
subdivisions
families like this
supplying
new
one.
are
California
employment opportuni¬
generation—and all the essential services
financing with municipal bonds makes possible.
MUNICIPAL BOND
DEPARTMENT
The Bank of America knows this young
their counterparts
their
family and
throughout the state. Knows them,
needs, and prospects and reflects the confidence
they inspire by bidding, with associate dealers,
on
virtually all California State and municipal bonds
BANK
OF
NATIONAL TRUST
AND
AMERICA
SAVINGS
ASSOCIATION
San Francisco
•
Los
Angeles
@FedFRASER