Full text of Commercial and Financial Chronicle : December 3, 1953, Vol. 178, No. 5278

View original document

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

ESTABLISHED 1S39

SSsy
!,GAPj

The Commercial

dec

1953

""SIKH

Chronicle

Financial

Reg. U. 8. Pat. Offioe

Volume 178

Number 5278

New

Cents

Price

York, N. Y., Thursday, December 3, 1953

Copy

EDITORIAL

We See It

The attention of
economic

affairs

thoughtful students of world

has

been

of late to what is

attracted

and

shop windows and

upon

After listing

istration to

(3) the

gram;

out

businesslike economic

new

of conservatism in

resurgence

Mr. Shields

sees

"another 1929."

that

reason

farmers of this

ade, but points out there is still room for improvement,
and with an increasing population, as forecast, farm sur¬

power,

should experience

Stresses fact United States is still

plus and farm exports

products these German articles

these

turbulent

times

and

mal and just about ideal.

of things to come must make allowance for an unusually
wide margin of error.
On the "one hand, it is not to be

they

denied
a

that

resurgence

the

huge
the

ministration

set

into

market,

when

one

nearly
two

the

Congressional committees so largely
influential in shaping legislation bearing upon
our
foreign economic policy.

Natural

consumer

long,

extent.

price

the

the lofty levels

structure

for

sonably priced than those available to him from
our own plants. It is likewise to be expected that

creased

weight
competition will go to Washington
on

IBA

and

uted

page

address by Mr. Shields at the Annual Meeting of the
of America, Inc., New York City, Nov. 10,

Manufacturers

CONVENTION

ISSUE

"Chronicle"

SHORTLY—The

moderately.

for

the

im¬

but

great factors.

none
of these
Canada contrib¬

With the outbreak of the

war

and the

After a while waste on the battlefields
great.
Consumption by the armies inContinued on page 32

important factor.
very

Grocery
1953.

December

supplies

closing of the Dardanelles, everything changed. Russia
was at once removed as an exporter, and this was a very

developments
on

A few smaller countries

the

Argentina;

Uhlirann
were

dare not disregard the possi¬

of unfavorable

conjuncture

Richard

became

page

sharply that

and Rus¬

exporters

adjacent to the Black Sea, Australia,

our Defense Program has
production at "forced draft"
debt and inventories have in¬

both

chief

the

porting countries in a more moder¬
ate degree, such as the Balkan States,

our

Continued
*An

Continued

bility that

the domestic manufacturer who feels the

and

long,

States

United

The

were

added

subsidies,
kept

largely

were

season

fair price in every coun¬

to the other.

omy

Murray Shields

the

wheat, each competing with the other
for predominance. One year the vic¬
tory belonged to one, another year

has become so dependent on an
assortment
of
pegs,
supports
and

to welcome the

opportunity to buy the products of other lands
judgment they are better or more rea¬

new

near

sia

"souped up" with inflation, our econ¬

if in his

of this

an average,

try, and yet not high enough to stim¬
ulate production to an extraordinary

recently attained. On the other hand,
business has been so good
for so

Consequences

It is natural for the

end

brought

Ad¬

policies provide a formidable
of influences tending to hold our

economy

conditions were nor¬
the world pro¬
requirements. In years
had short crops, supplies at

annual

depleted, and in years of plenty they
were
moderately increased. Wheat

stimu¬

adopt highly

its

countries

and

props

very

lative

and later to

class

automatic

determination

clear

the attention of,the so-called Randall Commission,

income

middle

new

assortment

duced

technological progress,
in population growth,

redistribution

us poor,

long-run effect is bound to be detrimental.

Before World War I agricultural

of the shape

appraisal

any

likely to disappear. Concludes,

are

artificially limiting farm output inevitably makes

"growing country," but urges business, associations, and
government "do a bit of post-boom planning."

the

"Fair Deal" legislation. Says
country have done well during past dec¬

quent "New Deal" and

many coun¬

lastly, the recent exhibition of nation's economic

subse¬

the 1929 act in Hoover Administration and the

pro¬

tries; (4) removals of credit and interest controls, and,

are,

ence, as

conditions in grain
production from outbreak of World War 1 up to the pres¬
ent.
Gives history of artificial farm price supports from

significant and highly favorable develop¬

carve

Trade

Prominent grain merchant reviews

past year; such as: (1) the serious weakness
behind the Iron Curtain; (2) the efforts of New Admin¬

naturally, well aware of their pres¬
are also of the entry into our mar¬
kets of other types of products which are not
normally distributed through retail channels.
All this is, of course, part and parcel of a
situation which is certain soon to be brought to
compete

Former President, The Chicago Board of

ments of

shelves of retail distributors. Domestic manufac¬
turers with whose

President, Uhlmann Grain Company

Economist,

Vice-President and

Bank of the Manhattan Company

now

only during the past few years that purely eco¬
nomic developments there have become extraor¬
dinarily impressive.
The rank and file of the people of the United
States are beginning to take notice of the increas¬
ing extent to which products from Germany are
found in the

On the Farm
By RICHARD F. UHLMANN

By MURRAY SHIELDS*

popularly known as
Western Germany. Politically, this country — if
country it is—has, of course, been the center of
a
good deal of attention ever since the end of
World War II, and inevitably so. It is, however,

to be

Restoring Free Enterprise

Shape of Economic
Things to Come

will

include

addresses, committee reports, etc., made during the Annual Convention of the Investment
Bankers Association of America currently in progress at Hollywood, Fla.

State and

IJ. S. Government,
State and

Municipal

Securities

WESTERN
of INDIA. LIMITED
Bankers

the

Government

Kenya Colony and
telephone:

HAnover 2-3700

Head

26, Bishopsgate,
London, E. C. 2

Burma,

Ceylon,

Kenya, Tanganyika,

Zanzibar,

and

Bond Department

Somali-

Authorised

£4,562,500

THE NATIONAL CITY BANK

£2,281,250

Capital
Capital

Fund

Reserve

£3,675,000

OF NEW YORK

The Bank conducts every description of

department

banking

and

exchange

also undertaken

WALL

STREET

NEW YORK

5, N.

Bond Dept.

T. L.WATSON &CO.

•

NEW YORK CITY

Active

Teletype: NY 1-708

Markets

Dealers,

Banks

and

""N.
other

Western

Denver
Spokane

Brokers

SUGAR
Raw

—

Refined

—

Commission Orders

BONDS & STOCKS

Power &

CANADIAN

DIRECT

Exports—Imports—Futures
I

WIRES TO

■

MEMBERS

}

Dlgby 4-2727

BRIDGEPORT

MONTREAL AND TORONTO

Goodbody & Co.

Established 1832
PERTH AMBOY

upon

request

DEPARTMENT

Teletype N Y 1-2270-X

American Stock Exchange
i

Executed On All

Light Co.

Canadian Exchanges at Regular Rates

Members N. Y. Stock Exchange

Liquid

YORK

Puget Sound

CANADIAN

Analysis

NEW YORK 4, N. Y.

BANK

OF NEW

OP THE CITY

Maintained

and

SECURITIES

BROADWAY

NATIONAL

Cities

CANADIAN

Y.
50

50 BROADWAY

CHASE

THE

ESTABLISHED 1915
Members of All Principal Exchanges

Los Angeles

Net

LAMB0RN & CO., Inc.

Salt Lake City

business.

Trusteeships and Executorships

9 9

J.A.H0GLE& CO.

Protectorate.

Paid-up

COMPANY
bond

Pakistan,

India,

Aden,

Uganda,

land

BANK & TRUST

Bonds

Uganda

Office:

Branches

Chemical

Municipal

NATIONAL BANK

115

NEW

BROADWAY

NEW YORK

YORK

STOCK

EXCHANGE

1 NORTH LA SALLE ST.

CHICAGO

PoMcaox Securities
Grporatioti
40 Exchange Place,

New York tf.N.Y,

IRA HAUPT & CO.
Members
and

New

other

111

WOrth 4-6000

Teletype NY 1-702-3

WHitehall 4-8161

Boston

York Stock

Exchange

Principal Exchanges

Broadway, N. Y. 6
Teletype NY 1-2708

Telephone:

Enterprise

1820

The Commercial and Financial Chronicle... Thursday, December 3,

(2146)

The

and trade in

We position

Security I Like Best

Tel. & Tel.

American

This

Forum

in the investment and advisory

participate and give their reasons for favoring

Manager Statistical Department,

Brooklyn Office of Josephthal
& Co., Members N. Y. S. E. and

Central Illinois Elec. & Gas
(The articles contained in this forum

Rights & Stock

they to be regarded,

are

Office of Josephthal & Co.

N. Y.,

Members N. Y. Stock Exchange

Utility

Public

Central

other

Morris

Thermit

Plan, Pfd.

holder

Polaroid

Corporation

**Analysis

Management.
Profitable Research.

Established

American

120

Stock

Broadway,

Exchange

New York

Teletype NY 1-583

BArclay 7-5660

Specialists

Rights & Scrip

industry,

New

Stock

York

American

120

Stock

Tel.

REctor

and

produces
(1952) 3/3.000

Exchange
Exchange

Chem¬

tons of

BROADWAY, NEW YORK 5
2-7815

ical

and

SYSTEMATIC PROFITS

You,too,

may

benefit

our

CAPITAL CAINS

PROGRAM
trial

Rayonier

for

rial

subscription

Security Analyst since 1926
Corning, California

rayon

man¬

foundation

mate¬
acetate

now

yarns,

also

material in at least

raw

other

applications.

consumer

Sales of cellulose have

world

production
of
rqyon
from 1,691-million pounds in 1946
to

4,000 million in 1951.

over

In¬

stalled

American Furniture

Bassett Furniture Industries

Commonwealth NaturaF Gas

declining

rapidly, as total world
output is only 250,000 tons.)

Thus,

today,

third

for

little

than

Rayonier's

rapidly in¬
goes to Rayon,

tonnage

new

customers and

which

uses

were

non¬

few short years ago.

LD 39

TWX LY 77

Export
Rayonier

big lift.
put
it,

sales, now but 15% of
volume, are due for a
As Rayonier-men like to
the

population
with
apace.

I. G.FARBEN
And Successor

capita

population outside
less

consumes

per

capita.

per year,

per

world

the U.

than

pound

over

consumption still growing
The 2 billion free world
one

still

pound

increase

would require a

GERMAN

consumes

per

one

Companies

million

160
now

pounds

seven

Finances

of only
capita by them
35% to 50% rise

output, an exciting

Research,

tion

and

Research

diversifica¬
expansion have

product

plant

Members

New

York

Stock

bonds

ment

Pteae: HAnover 2-9766
1'

Tele. NY 1-3222

the

ing.

special¬

about $80

shares outstand¬

practically completed

Special

Cash

fund

set

up,

(with
below

the line, for projected costs of
completing the program, in the
amount of $24 million) it is ob¬
vious

that,

amounts

tion

set

distributed
their
to

from
aside

Reserves,
way

here
for

on,

any

Deprecia¬

together with

un¬

earnings,
will
find
into further additions

Working

You

count

can

the

hand

one

the

$200,000

fin¬

who

few

major factor
in such margins, are only about
26% of Rayonier's sales.
Naturally,
this
large
profitLabor

spect.

New

margin holds enough appeal to in¬
vite competition,
and President

Highway Authority
2%% State Guaranteed Bonds
Series B

Morgan's objective in his expan¬
is therefore twofold:
maintain absolute leadership

size,

January

Due

output,

resources,

to fall to

were

only 20,000

month, and if prices

also to fall $10

expected

are

Price 101 and interest
(when

prevail

(and

Gordon Graves & Co.
Street, New York 4

30 Broad

would be

quite safe.

greater

the

benefits

and

tax

Certainly, here is

with

Rise

combination

holders!

volume

plus.

and output
a

few

for

1951-

averaging $75 mil¬

Current

expansion

indicates that,

years,

sales

will

reach around $100 million. Profit-

up as

Sales, since 1947, stacks

follows:

thereafter,

should

"we

dividends."

1954, it is almost
Rayonier will be

pay

which

President

Morgan

economist-predicted

industrial
should
said.

taken

affect

Telephone WHitehall
Teletype

As to

dip

year,

in
this

those

Call

already
industries

for

our
on

consumers-

$4.80

current

publications

YAM AICHI

Office Tokyo

Brokers

Earnings of 1950-51-52-53. have

write

Established

Sharp Rise Warranted

around

Opportunities
Japan

SECURITIES CO., LTD.
Home

Price-Times-Earnings Ratio:

For

3-0066

Japanese securities

likely will increase.

averaged

Request

1-824

has

the

Investment

by Rayonier, and produc¬

share
on

New York 6, N. Y.

Broadway

re¬

Rayonier,

recession

place

served

tion

output

not

Brochure

S. D. FULLER & CO.
39

Thus, by midcertainty that

cently termed "very good."
the

Price $2 per

paying $2 an¬
nually, for 71/2% yield, at price of
26.
This rise would seem justi¬
fied by current operating results,

1897

—

111 Broadway,N.Y.6

Branches

Investment

«£■

Bankers

COrtlandt7-5680

share.

two

strong
reasons,
Ray¬
onier is deeply underpriced at 26,

the

pleasing to share¬

52-53 has been

that

Stock

Common

Offering

Inc.

Recording Tape

Sound

1954

Magnetic

Manufacturers

will

only 5V2

times

these

(1) Apparently being rated with

of factors most
Sales

ORRadio Industries,

allevia¬

1954, along

strong financial condi¬
is anticipated that, divi¬
be increased anyhow.

149,500

new

very

tion,

3-2840

New Issue

In fact, with

efficiency

facilities,

plant
tion

Telephone
WHitehall

through

1954, but it is obvious that even
at only 80% of capacity, dividends
the

issued)

were

to $15 a ton

1984-88

(callable)

and
know-how; and to keep competi¬
tion on the secondary level where

Jersey

costs,

earnings.

Break-Even Point Low

present

Taxes.

and offer:

own

challenge Rayonier in this re¬

(NYSE)

Capital.

Profit-Margin Very High

Research, headed by inter¬ Margin
distinguished

As the expansion program is

now

and

management

present, cash

(At

1,987,742

ship

able

cur¬

Rayonier
will
expansion, since
million.
Al¬
lowing for debt financing, there
has
been
actually plowed back
into the business, from earnings,
about $40 million, or $20 a share

within

his

for

spent

Clyde

leader¬

times all

risen

have

war,

dema'nd

Morgan's

2V2

amounted

mid-1954,

have
the

its' that speaks volumes for Presi¬

nationally

eral.

Dividends Due

$17 million.)

lion

team.

even

Earnings

Large

alone

liabilities.

rent

Exchange

25 Broad St., Hew York 4, N. Y.

matched or exceeded
the elite of industry in gen¬

Although President Morgan has
current assets of
Covered
current opposed any raise in payments un¬
til the new Jesup, Ga. plant is in
liabilities
of
$4.8
million
6.9
next spring, he feels
times.
Cash and U. S. Govern¬ operation

brought growth in sales and prof¬

Strong;

from all

has

year-end,
$33.4
million

dent

OPPENHEIMER & Co.

exempt

Federal Income

field, but in the last few

own

po¬

indeed, which
Rayonier
expects, and is preparing for.
Management and

Bought—Sold—Quoted

Very

Plow-Back

tential

INTERNAL SECURITIES

its

years

dends

Lynchburg, Va.

Jesup,

about a third of North
American, and about a fifth of all
world output of cellulose.

holdings

| (Cotton consumption is

existent

STMMR,TAYlO««CO,lnc.

represent over half of U. S.

pounds.

the balance to

Life Insurance Co. of Va.

will

$12,284,000,

creasing

Dan River Mills

mill

output,

capacity by end of 1954,
as
estimated
by
"Textile
Organon," /will reach 5,623-million

cotton

Camp Manufacturing

ahead,

in 1951 began a

million

$29

new

than

tripled since 1946, just to keep
pace with the tremendous increase
in

Trading Interest In

years

branch offices

to our

gin not only tops all companies in

tons

several

provides

manufacture

principal
17

HOMER FAHRNER

Klybert

re-growth

forestry

originally

Interest

it¬ Ga., scheduled for completion next
self with an' inexhaustible supply spring, will add 87,000 tons more,
of basic raw materials, trees.
raising total capacity by 20%, to
Chemical Cellulose, developed around 520,000 tons annually. This

and
Free

Lawrence

agement,

37.2

profit-mar¬

extraordinary

wires

Direct

modernization-expansion this simply cannot happen, the
program.
Capacity of the four management asserts) present divi¬
At
present mills has been increased dends would still be covered.
by 55,000 tons, while the great present, full capacity operations

Pulps

careful

This

32.6%

huge

Fine

Papers.

78.3

duction

for

President Morgan

Paper-

Making

41.9

1952

the capacity of present production

4 0,7 5 0

tons of

concern

with any prospective

NY 1-1557

35.8

83.8

facilities

Cellulose,

a n

main

Stock Exchange

St., New York 4, N. Y.

now stands.
business
dip, but rather "to develop suffi¬
Astonishingly low is the breakcient capacity to fill 100% of our even-point of operations. For ex¬
customers' requirements." As ample, present capacity is around
world demand will reach beyond 37,000 tons a month. Even if pro¬

not

and

Florida)

Completed

Nearly
Rayonier's

Now

Program

Exchange

Stock

York

New

Members

sion program

products.

Expansion

Huge

Washington,

Members

soluble,

marvelous

Steiner, Rouse & Co.

La. - Birmingham, Ala.
Mobile, Ala.

other

and

000

ffipONNELL & CO.

CMC,

digestible gum used (as binding
or
suspension agents, or thick¬
eners)
in detergents, cosmetics,

pharmaceuticals, paints, ceramics,

total¬

Georgia

Also, there is the

explosives.

new

ing over 800,acres
in

Since 1917

fac¬

66.4

1951

gers

timberland
acreage

me¬

Bought—Sold—Quoted

26 5

can

and

(owns

Tree

such

film;
Plastics;
Nitro¬
cellulose for fast-drying lacquers,

company,

young

also

Cord,

Tire

New Orleans,

32.6

48.7

Photo

With

Starts
a

old,

years

manufacturers

include

63.4

1950

technical

chemicals

cellulose

tauig.ii

$50.0

1949

developed—and
prove as profitable to wood-cel¬
lulose producers as similar
by¬
products have been to coal and oil.

users

Millions!

1948

—several already

through

**'

Profit-

1947

"Horn

tory belting and industrial hoses;

Growth
young

HAnover 2-0700
l

;

1,1

25 Broad
Sales

Plenty" of valuable new products

Cellophane;

Higher Dividend Due in 1954.
Deeply Undervalued Currently.

well

may

Members American

38)

Silvichem¬

chanical rubber goods

Price-Times-Earnings Ratio
Should Rise Sharply.

Rayonier,

istry

Law¬

Manager, Weeden
& Co., Los Angeles, Calif. (Page

wood is con¬

cellulose.

into

verted

—

Resident

and

two-

about

after

over

thirds of the original

now

High Profit-Margin.
Low Break-Even Point.

1920

left

Bakeries Corp.

S. Pulliam, Vice-President

rence

for waste mate¬
acids),
hereto¬

(lignin

jor

Big Plow-Back of Earnings.

Member

big

intrigueing new
of Silvichemistry.
This is
the

collaboration with customers, ma¬

Finances

Corporation

Rayonier,

for

Meanwhile,

Expansion Program.
Very Strong

Huge

New York Hanseatic

Associate

briefly.

Steady Growth.
Able

request

enumerate

Rayonier,

10, and develop them

Puget Sound Power & Light

gained

headstart

fore

reasons

many

has

Leading
(Page 2)

Interstate

Louisiana Securities

Exchanges."

Other

chemistry,

cellulose

wood

rials

wh.y I
should like every one of my read¬
ers to become a long-term stock¬
the

nor

the study of uses

Rayonier, Incorporated
Of

science

and

leading Exchanges

Colorado Interstate Gas
**Investors Diversified Services
**MetaI

Dept., Brooklyn,

Statistical

Manager

Prospectuses on request

ists

KLYBERT

LAWRENCE

Rights & Stock

be,

offer to sell the securities discussed.)

as an

Telephone

Rochester

intended

not

are

Alabama &

Selections

Rayonier, Inc.—Lawrence Klybert,

particular security-

Week's

Participants and

Their

week, a different group of experts
field from all sections of the country

A continuous forum in which, each

Subscription Rights

33/4% Deb. due 1965*
Delivery when issued '

1953

has

volatile
more

industrials, Rayonier
the growth character¬

istics of chemical company stocks
which
are
generally
market-

priced

ings

(2)
low

around

times

Over-the-Counter

Quotation Services
for 40 Years

earn¬

higher.

Although being rated
and

issues.

mediocre

Rayonier's

with
profit-margin
margin ranks

National Quotation Bureau
Incorporated

with topnotchers such as du Pont,

Established 1913

Dow. and I. B. M.

Therefore, Rayonier ought to be

46 Front Street
CHICAGO

Continued

page

New York 4,
SAN

N.Y.

FRANCISCO J

Volume 178

Number 5278

The Commercial and Financial Chronicle

...

(2147)

Future of Color Television
By

Vice-President

Mr.

Bonfig

INDEX

BONFIG*

Sales, Zenith Radio Corporation

color television is definitely on the way, and
will come in an
orderly manner without detriment to present
recehers, but holds that product for mass market is at least
says

two years
away.

Expresses

Shape

of commercial television.

Economics

crystal

ball

at hand,

But

nevertheless, I am going to
you
something
about
the

tell

the

son

prophet.

ness.

cast

based

the

yardstick
with

liar

(lies

fami¬

duction
we

fantastic

viewers
flected
H.c.

Bonfig

velopments
To
it

must

And

the

one

idea

The general
so

not

indeed

terest

may

lack

Labor

Health

in¬

sales

friend—the

excess

with

profits tax. The

commerce

something under $600.

merchandise

tical

close.

Now

last

sellers' market has

during the
scarcity,

years,

than

There

was

customer

—

again.

period
we

finding the
seeking us. October

came

to say was,

"We ain't got

All

changed, and in order to sur¬
vive and prosper we must active¬
we

lenge

will

profit

and

loss

here

reflected

manufacturers

have

our

set

the

true

FCC.

color

with

demon¬
all

Round

Two—Beardsley Ruml

Purchasing

Agents'

tube.

Only

color

sets

were

the

20
20

Survey.

development in the art.

Zenith, along with

other leaders,

has witnessed the birth of

bow

tube.

rain¬

the

hospital,

presently,

will

to speak.

home. I am, of course,

But,

leaving for
referring to

tubes

sion

new

this

parents,

black
then

may

white

and

color

*An

take

where

success

any

guide,

television

will

vastly

address

Luncheon

vertising

by
Mr.
Bonfig
at
a
Meeting of the St. Louis Ad¬
Club, St. Louis, Mo. Nov. 24,

Every

one

who

size

—

the

exhibited

tube, namely

half;

last

yet

color

average

receiver

from

runs

tubes. The show
was

our

same

tube that gave a
picture of under
14 inches. The
average black and
white television receiver has 20

problem begins.

our

the

only

televi¬

hour
of

and

the

Bank

See

and

trading markets in

Buying Plan Announced by NYSE

Business

present, including
Zenith, had a competent engineer
sitting alongside of his color tele¬
receiver

make

Continued

1953.

stocks and

Bookself.

Securities

Events

News

Investment Field

sure

About Banks and

page

Prospective

The Market.

Security

and

BROAD

New

York

Stock

Albany

•

Manchester, N. H.

Boston
•

Exchange

•

Nashville

Chicago

•

TELETYPE N. Y. 1-5
Glens Falls

•

Schenectady

•

Worcester

Mexican Gulf Sulphur

44
8

You—By Wallace Streete

Pan American

Best

-~£»

You____

__~4™

„___.

See

"Canada's Economic
Development Analyzed"
Twice

Weekly

COMMERCIAL and

Drapers'

Gardens,

Reentered
WILLIAM

DANA

COMPANY, Publishers

December

—

corporation

Other

bank

clearings,

city news, etc.).

Offices:

Chicago 3,

news,

111.

135

(Telephone

STate

pest

office

Pebruat

New

of March 8, 1879.

W" V. FRANKEL & CO.

Salle

8t.,

2-0613);

$33.00

Quotation

per year.

Note—On
rate

Record

—

Monthly,

(Foreign postage extra.)

account

the fluctuations

WHitehall

NEW

NY 1-4040 & 4041

Direct Wire

PLEDGER

YORK I

3-3960

COMPANY

exchange, remittances lor foreign subscriptions and advertisements must

be made in New York funds.

39 BROADWAY

Teletype

Other Publications
and

INCORPORATED

Union, $48.00 per year; in
Dominion
of
Canada,
$51.00
per
year.
Other Countries, $55.00 per year.

the

South

the

Subscriptions in United States, U.
Possessions, Territories and Members

Bank

Sunset Oil Co.

B. Dana

Pan-American

1953

Every Thursday (general news and advertislng issue) and every Monday (complete statistical issue
market quotation
and

Eng-

Subscription Rates

WILLIAM DANA SEIBERT, President

records,

1942,

to 9576

HERBERT D. SEIBERT, Editor &
Publisher

state

25,

C.,

second-class matter

y°rk' N* Y-» under the Act

Place, New York 7, N. Y.

Thursday,

ary

smith.

Reg. U. S. Patent Office

12.

page

London,

Iand- c/o Edwards &

CHRONICLE

Sulphur Co.
Standard Sulphur Co.

•

ST., NEW YORK 4, N. Y.

TELEPHONE IIAnover 2-4300

Offerings
Corner

State of Trade and
Industry

REctor 2-9570

Spencer Trask & Co.

Keta Gas & Oil

The

and

Eagle Oil & Refining Co.

Security I Like

25 Park

Members

The

1-1826

Registration

Salesman's

Washington

Securities-

Now

Securities

Railroad Securities

Securities

Exchange PL, N. Y. 8

Report..

Utility

FINANCIAL

PREFERRED STOCKS

specialized in

Bankers.

Governments

Reporter's

Public

Teletype NY 1-1825

„

HA 2-0270

Notes

Reporter

Our

Singer, Bean
& MACKIE, Inc.

Funds

Published

have

8
18

Observations—A Wilfred May
Our

bonds.

Cover

Stocks

____

NSTA

The

For many years we

225 unlisted

(Editorial).

Man's

Canadian

Coming

Insurance

manufacturers

vision

firm

Regular Features

demonstration

an
one

every

maintain

Guaranty Trust Co. Holds Tax and
Wage Relief, Not Govern¬
ment Credits, Is
Primary Need of Small Business

another of the three above

manufacturers

had

color TV.
As

manufacturers.

that birth has been confined

now,
to

television

one

Teletype
NY 1-3370

Advantages in "Extraordinary" Budget Seen
by
National City Bank_____

new

Telephone

DIgby 4-1680

Mutual

great,

and
Zenith. The rest of the
13
manufacturers used color tubes of

Street, New York 5

Indications of Current Business
Activity.

15 Broad

lem

compounded

Manager

Trading Dept.
☆

further

JOHN F. REILLY,
Unlisted

Dealer-Broker Investment
Recommendations
Einzig—"Will Britain Remove Control
of Capital Issues?"
From Washington Ahead of
the News—Carlisle
Bargeron

shoe

BURNHAM AND COMPANY

Amendments

Western Europe's Progress

Sold

☆
12

Optimistic

—

Members New York Stock Exchange

-fi

Bought

soap,
plow shares, horse
FCC had in their set their own
nails,
or
television.
And
make of color tube. Those three
speaking about television, since I
manufacturers who had their own
have
some
slight
acquaintance
color tubes were
Columbia, RCA
with it, our merchandising prob¬

cereal,

Ultrasonic Corp.

Prosperity—Roger W. Babson

Mackersy

know

manufacturers who

demonstrate

Time, Inc.
13

Leaders?^—Donald R. Richberg

only 13

color television

Giddings & Lewis

Policy

Fairless

color

one
—

there

sets

that the heart of

from

those

said

show

television

Foremost Dairies

manufacturers

were

their

on.

What

strate

chal¬

statements

invited

Monetary

Marcus Nadler Contends
Deflation Is Nation's Main Threat
Business Continuing at Slow
Downward Pace According to

Waldorf

television receiver each

our wares.

that

well

Installment Stock

television

were

all

How

the

American Marietta

on Trading in
West German Bonds______
SEC Would Relax
Competitive Bidding Rule on Public
Utility Issues

ago, on

15,

WALL STREET, NEW YORK
Telephone: WHitehall 4-6551

Standpoint

SEC Proposes Rule

com¬

Astoria.

But now—that is

ly merchandise and sell

saw

Douglas

John J. McCloy

Communications
ever

Obsolete Securities Dept.

Savings Banks

Senator Prescott Bush and
Others Confer
to SEC Acts___

patible
color
television
on
the
present standards demonstrated by
the industry was in the
showing
that took place five weeks

And all the salesmen had to learn

of these goods."

Federal

Commissioners

were

Flexible

obsoletes !

worn

Stake in Convertible Currencies

Reform:

Television

the

order-takers.

trouble

the

prac¬

become

once

merchandise

little

must

hard-hitting salesmen
For

and

come

dollars

Canada's Economic
Development Analyzed by

true. I can best tell
you the status
of color television
today by telling
you
what has happened in the
month just passed. The first time

filled

are

:!<

mightily afraid that, for all
not referring to the end
our
good will, it will be a long
advertising agency's good time before that dream
comes

pipelines of

Have

for old

line.

our

new

1954

Cobleigh

York

21-inch color set that

Color

and

era

New

not

bright

Kestnbaum

and

Budget

beginning of another.

McKenna

Lewis

—Benjamin

our
problems, is now
impatient for the quick
a

Just

Why Transfer Management to Politicians
and

that

sells for

for

and National

Humphrey.__■

TEA AND SYMPATHY?

Employees' Stake in Stability of Steel Business

are

even

Should

—Lewis

the

that

Wilbur

Our National

public, which
informed, or

precisely

Engineer—Philip M.

Pullman—Ira

Fund

—Meyer

manufacturer,

that

you

good

complications

arrival of

sure

the

I'm

the

which

like.

apparent

have ended

we
are

the

Right
in

a
laboratory
techniques of the pro¬

ahead.

re¬

the

surveys,

with,

have

laboratory de¬ growing

and

begin

time.

manufacturing business:

line.

statistics,
of

Mutual

translating

style trends,
reactions

George

the

Cover

Bonfig

Stock Investments from the
Savings Bank
—Alfred C. Middlebrook

speed-up in

any

and

Awake

—J.

headache

vast

child to the

sales

—

march

the

television

which
are

slow

now,

measurements

you

speedily.

to be matched

What the Next Ten Years
May Have in Store for Us
—John E. Haines

But I seriously doubt that our
ambitions in that direction are apt

fore¬

will

sheer, selfish,
materialism, there is ample
for urging
this develop¬

reason

Come—Murray Shields

Television—H.

Pressure Groups Disrupting
Administration's Policies
—Walter W. McAllister

look at it from

standpoint

ment forward

see

it.
This

Thus, if

the

cussed

future of tele¬
vision

Wide

reward those who are in this busi¬

nor

Things to

AND COMPANY

Cover

The Outlook for Capital
Expenditures in
—Robert P. Ulin

during 1954.
no

Color

Security—Hon.

Indicates advertisers may not be able
bear the costs, and this
may hasten day of subscription TV.
Concludes television "needs to set its economic house in
order,"
and reveals 30% of new TV stations
will operate in the red

have

We Must Have Both Prosperous
Economy

Economic

Future

however, with rising costs

concern,

Page

Restoring Free Enterprise on the Farm
—Richard F. Uhlmann_.

llCHTfflSTflU

B. S.

Articles and News

and Director

LOS ANGELES

INI,

The Commercial and Financial

Chronicle

...

Thursday, December 3, 1953

(2148)

the

We Mast Have Both Prosperous
GEORGE M.

By HON.

Secretary

Security

lasting peace—not only in¬
the affairs among nations
also the
affairs within our

but

security does not mean armies,

need

in¬

evolution.

of speech.

figure

This

Our

critical

time

sharply our two
great parties may and should de¬

idle

age bears
most revo-

witness to some of the

What

itself.

freedom

and

tion

the cold

It is

and somber truth.
for

this

all

free

the

fortitude, the wisdom and

recorded

seen

the pene¬

the

tration

mysteries *of
and

imagination of
wisest
and

—

bring

security. The third is lead¬

ond is

a new

economy.

generalization covers
specifics. Security
does
not
mean
armies,
navies,
rockets
and
jets alone. It also
means
honest dollars and sound
of

wealth

fiscal

policies.

upon
military tacticians or the
first for the
ingenuity of
nuclear physicists
simplest of reasons: Its attainment
menaces,
and weapon designers. It depends
is the first prayer of all America
whose hopes are beyond the hopes
also upon the ingenuity of manu¬
—and that instantly makes it the
and fears of any man alive today.
facturers,
the
venturousness of
supreme purpose of this Admin¬
We have seen the nature of war
capital, the skill of men along the
istration and this Government of

age

George M. Humphrey

marks,

the

and

weapons

war

have

speak

and the

safeguards of peace become utter¬

mands

effort fully

revolution engulf

total

hundreds

have seen organized
nations, swallow
of
millions of people,

claimed—or

threaten

all

new.

and

nations,

free

challenge America to what it con¬
ceives to be a deadly duel for the

assembly-line.

single task summons and
all our energies.
It de¬

directs

nature of peace

the

peace

the United States.

This

seen

com¬

revolutionized.

pletely

—or

war.

Peace

cannot

total as
be

pro¬

declared
voted. It must be deserved,
enacted—or

and

pursued,

won.

demands

turn

The

that

make

can

arms

no
na¬

whose people are not

secure

And that means a healthy

secure.

and

truth

simple

amount
tion

vigorous

economy.

I must be blunt about one

point:

question is frequently asked

The

And that in
understanding, today:

"Which

favor,
concerned

you

sacrifice, wisdom, and which are you most
the kind of plain American cour¬ about—prosperous economy or
Now, in this time of critical
an
adequate national defense?"
age and steadfastness that alone
change, the people of America
This is a specious question. It is
can
halt and disarm the enemies
have summoned
the Republican
like
asking a man whether he
of freedom.
Party to lead them. Such a sum¬
We know—we hold a number prefers to keep his head or his
mons, in such an age, is no mere
heart. For it is inconceivable that
of
basic convictions—about
this
conventional electoral mandate.
a strong national defense could be
It is a call to guard and save pursuit of peace.
supported
by
anything
but
a
First:
We
know that willful,
our very freedom.
healthy national economy.
.
armed
aggressors can
never
be
It is an echo of a similar call
For this clear reason, our con¬
turned back by weakness. There is
made 100 years ago when this na¬
cern
for
the
nation's
economy
patience,

world.

only one thing that the aggressor's cannot be measured merely " in
respects — greater terms of
civil war, when the institution of strength
wages or profits or divi¬
strength. And that strength Amer¬ dends. We are
slavery in different form was also
not, in the ultimate
ica must and shall have.
the fateful issue, and when the
sense, thinking of stock quotations
Second: We
know that such and interest rates. We are not
people's will brought this party of
strength, wisely used to serve weighing decisions in terms of
ours
to birth.
And history has
peace, does not demand belliger¬ washing
machines or television
decreed that
we
celebrate this ence, loud threats or bombast. We
tion

drifting toward

was

ours

Our

sets.

centennial of

Party's birth by

our

mastering

accepting, meeting, and

not have to shout or strut

And
♦An
at

Dinner

Committee

23,

Humphrey
sponsored by the Republican

address

having it,

Secretary

Chicago,

Illinois,

111., Nov.

* p

1953.

our

strength. We need only to have

remain

ever

it.

must and shall

ready to resolve,

peaceful discussion, any or all of

Among the unhappy legacies
this Administration inherited from

our

That's

in unlisted securities
buyers or sellers

good suggestion any time

you

critics

109 offices

thousands

private wire that link
from coast-to-coast
.
can contact literally
of customers and dealers for the particular
have 65,000 miles of
.

issues or quotes you

think

help, just

can

employment,

and

known

cost

which

living

So, any time

you

—

those

rolls,
this

has

seen

the

over

the

Merrill

There

Lynch"

who

were

Beane

Brokers in Securities and Commodities

pre¬

crippling
the

from

pre¬

fell

the

included

the

heir

economic field.

inheritance

public debt, the restrictive
debt limit, $81 billion in C.O.D.
orders
extravagance in govern¬

huge

the staggering tax

ment,
NEW YORK

Offices in 105 Cities

thus

vious Administration to which this

Underwriters and Distributors of Investment Securities

STREET

other

inherited

fiscal and

Pierce, Fenner

had

disaster.

dicted

This

rise

records ever

only

Administration

70 PINE

pay

activity

greater part of this year, gave the

to do it.

Trading Department

Merrill Lynch,

which

action,

to the highest

burdens

"Call

that

industrial

year

lie

we're happy

5, N. Y.

and

mate

burden,

top of it all, a war of stal-

Korea

bringing

Continued

sorrow

page

decline took place

Failures

in over-all industrial output in

Producers of consumer durables, farm

year ago.

textiles operated at reduced

equipment and

levels.

period aggregate claims for unemployment in¬

For the latest

benefits remained noticeably above

surance

the level of

a year ago.

According to a survey by the United States Department of
149 industrial centers early this month showed that "small

Labor
to

areas

employment declines" had taken place in a number
Among the areas, it noted, were "such

moderate

since late summer.

centers as Buffalo, Cleveland, Louisville, Milwaukee, Pitts¬
burgh and San Francisco." In other districts, where employment
did not drop, hours of work were reduced, the agency reported.
The department further noted that business continued active
in October and early November, though some industries were trim¬
key

It cited steel and auto manufacturing as lines in
The cutbacks, which were made

ming production.

reductions had occurred.

hold

down

inventories, contrasted with a firmer tone in some

industries, the department declared.

All this, it concluded, added

to mixed trends in the economy.
During the past several years, with practically all steel sold on

f.o.b. mill

basis, freight rates were largely the worry of con¬
consequently, the task of keeping up-to-date figures on

sumers;

rail, truck and water freight costs on finished steel was neglected.
Now that producers are finding it desirable to absorb freight to

participate

some

markets freight costs

are

again of prime

importance, states "The Iron Age," national metalworking weekly.
Freight absorption, as might be expected, is on the increase.

to wangle some equaliza- .*
figuring out how much
freight to absorb (on what products to meet what competition
where) are more perplexing than ever before. Freight absorption
problems, thorny at best, are frequently complicated by company
legal department "advice" barring what seems the most logical
solution, continues this trade weekly.
Steel sales officials who visit Detroit don't leave with a full
order book, but they certainly get their optimism bolstered. The ,
auto-makers are gunning for a big first half in 1954 and steel ,
producers are banking on auto output to pace their market, adds

Many large steel buyers have been able
tion concessions.
The complexities of

this

authority.

trade

Automakers

insist they'll

turn out 5,000,000 or more cars-

1954, compared to about 6,200,000 this year. Moreover, very heayy
output is scheduled for first quarter—especially by the Big Three,
says this trade publication. Both Ford and Chevrolet have sched¬
uled higher production runs for first quarter than they did for
first quarter of this year. Others are matching 1953's near record
in scheduling for early '54.
they are too optimistic and

pace

first

six

Age" predicts.

"The Iron

Despite
makers

have

sales bog down badly in the
months, the bright steel outlook will darken quickly,'

are

been

a spurt of "late"
orders for January, some steel¬
disappointed by the limited volume of business they
able to book for that month.
Hedging by some big

(including auto producers) is disturbing steel producers
as low order volume, this trade weekly points out.
Inventory correction is still the dominant factor in the mar¬

customers
about

much

plants longer than had been

It is taking some

ket.

anticipated to-

heavy steel stocks. Big customers hedging
insist they'll be back in the market, in a

off

work

orders still

January

big way for

and March. So these months will be crucial, observes
Age."
production last week shows Chevrolet, Pontiac
Buick still in the midst of model changeover, but industry

February

"The Iron

Automotive
and

back a bit after the curtailment the
Thanksgiving holidays, states "Ward's Auto¬

output is expected to bounce

past week due to the
motive Reports."

Output last week skidded to

the lowest level of the year,

only 51,863 cars, or 35%
79,709 in the preceding week, "Ward's" report.
the

companies building

This agency notes
to about

with

less than the

that November car production

will amount

361,000 units, off 32% from the 532,810 in October. Fore¬
month said the drop would be about 27%. The

casts earlier this
lower

well as a
companies to give their dealers a chance to reduce

production is a result of model changeovers, as

desire by the

their stocks of 1953

the

want.

What's more,
we

were

seen

and
we

the

the voices of
shouting
that

would not dare to do so. And

has

Why?
Because

first few weeks in office—

aftermath

want.

the arbitrary rule of
by needless, stifling

|We lifted these controls

swiftly

—especially when it's hard to find the

purpose

ly.

economy

further

faithfully and, I believe effective¬

controls.

Lynch"

this

served

have

defense

freedom that we cherish.

for every

our

Business

period ended on Wednesday of last week and it continued to
be moderately under the high level reached during the first quar¬
ter.
However, total production held about even with the level of

econ¬

our

first line of

the

for

cern

the past was

wCall Merrill

for

concern

is nothing less than our con¬

omy

Index

Production

the

This short

Price

which

Security does not depend solely

ership.

whose
whose

It
means:
A
supported by a

Security Needs Honest Dollars

speaking

of three of the words most
commonly used in these days —
three words that effectively sum¬
marize
the
challenges we face.
The first word is peace. The sec¬

stagger the

minds

clearly

most

plainly.
defense

sturdy
sound

to you

fusion

the

the security

this truth?

can

thoughts and actions. Our

our

pursuit of this ideal directly in¬
volves the prerequisite of security,
national security. I can define this

this truth.

that question by

answer

nuclear fission

think

all

for America, for
nations—is the honesty,

do we face

How

and Industry

flict.

Party,

faith with which we face

have

bipartisanship in all that directly
concerns the safety of America in
a world threatened by fateful con¬

What matters—

lutionary
changes

history.

faithful

pledged to a true and

This, then is our broad vision
saying is not mere of the ideal of peace, which rules

rhetoric.

partisan

issues, both must

bate numberless

another summons to save our na¬

Food

And

however

—for,

Commodity Price

its families lived in

demands, in a
certain clear sense, political peace

Administration among which is the
Public Debt, now practically at its limit, together with $81
billion of left-over C. 0. D. orders. Says financial policies of
Federal Government have been reshaped to serve "a single,
simple purpose to give the American people an honest dollar."
living

—

Trade

chronic fear of economic

disaster.

herited from the previous

are

State of Trade

Auto

peace

Output

Carloadings
Retail

nation could long guard its

freedom if all

dollars

economic

demands

for

Production

Electric

nation.

own

HUMPHREY*

navies, rockets and jets alone, but also means honest
and sound fiscal policies, points out "crippling burdens

Steel

The

volves

of the Treasury

Secretary Humphrey, asserting

<r
know that peace—

Finally: We

true,

Economy and National

the

dividing

issues

grave

world.

For

models.

November, 1952, the industry built 397,000 cars,

it further

states.
An

ber

was

increase of 23%

in auto output in December over Novem¬

forecast by "Ward's."

Continued

page

Volume 178

Number 5278

The Commercial and Financial Chronicle

(2149)

5
t

stretches

Economics and the Engineer

Observations.

By PHILIP M. McKENNA*

and Our Trans-Atlantic

White.

central

In Britain he is often

kind of

figure

thought of

Harry

robot, who wrote

at the behest of that vaguely conceived
entity, the American Treas¬
ury,

inferior version

the

Keynes

plan

to vex the British!

ferent

the

was

[sic].

was

markable

real
a

White

who

men

with

have

the

engineer,

same

the confidence of Mr. Mor-

ment

genthau. His influence with

that

give

esses

and

the

post which he held.

Brazilian

and

Chinese

Harry D. White

Stabilization Fund in support of

currencies.

Thus

had

practical
war

daily

extend

beyond the Treasury. He made enemies. In his
determination to get his
way, he adopted methods which might
be labeled those of an intriguer. He was distrusted in the
banking
world, and also by some seasoned public servants. He gained the

cils

some¬

Philip

thing about it.

bert

Gaston, and he
Cox

in good liaison during the

was

[sic] Mr. Lauchlin Currie.

war

with Mr.

It is probably true to

that but for White's assiduity and galvanic personality

say

scheme
would
•

and

kind

the

have

never

"The moral

solution

assembled
had

was

Bretton

meet

working

was

at Bretton

be that

nations

signed.

Keynes

in Britain

Woods."

miifch better scheme [for the

exchange problem]

devise

allowed

been

hand

which
to birth

come

seems

the

for

large

could

have

been

put

the

Woods, if only Keynes and White

together and given

agreed scheme

soon

The native ideas of both

had

men

completely free

the

'consideration'

been sicklied

over

than

disaster,

"The meetings

•"

successful,

Chair

and

lasted

week,

White's

Harry

deemed

were

masterly

do
and

children

our

affected

with

eradicate

not

conduct

the

Mechanical engineering requires
that
as

agree upon

power,

such concepts

distance

force

mass

horse-

kilowatt's,

modulus of elasthe like and define the

ficify

standard units in which

meas-

them.

Economics, and more
particularly, monetary economics,
has definite laws; they have been
discovered by painful experience
ure

"Before

the

British.

proceedings

known
was

which

Woods]

opened,

disappointment

great

learned that Harry White would

his outlook

and

vigor;

ery
-J

careful

observation

of our modern

over

The above excerpts

field.

But

when

people, often high in political and
business

and

academic

life,

the

past

economic

peared

John

Maynard

society in the

constituting

Towne

The

American

eers; New
McKenna,

tarY economics, displaying lack of

Harrod, published

1951,

come

that

ing by the public of the necessity
a sound medium
of exchange
and standard of value, determined

for

by economic forces rather than by
pressure

influences. When
enough houses in
artificial and arbitrary

group
not

there

were

some

areas,

rent-fixing seemed to be the immediate

against
rising
that led to waste
of what space there was and paraiyze(f the financial strength of the
very people who
had shown by
their actions in the past that they
remedy

cost of space but

could

build

fields

our

and

Autobiography" by R.

not cited

here

smart-aleck

post facto showing-up of Lord Keynes's judgment
indications of the past trust

The

ual.

houses

sufficient

economic

the

meet

work

demand.

well

ihuse

engineers
government

planners, scrapping the profit mo¬
tive

competition, resorted to
and excess profits

and

renegotiation

The effect

taxes.

muscles

effective

was

cal diplomat of the century seems

our

think

heads

our

douse

"McCarthyism."

Stevenson

down,

shame

up—are

because

pulling.

consequences

competitive

Our

the

Medal

Society

Mechanical

Engin-

Yor^ City> received the Holley
Dec.- l> J.953- ™rDec. 2,

the

Society

Mechanical

fields,

unfortunately

they acknowledgedly

vicious

populace

abroad

indeed

are

And

enced metal worker to flatten out walnut
sheet

was

brass

bulge

which

one

there

spot?

The

En-

to restore the desiied flatness
to put the sheet on

^
hit the

anvil and

...

place that sticks

Up.

the

'em

Do business

men work better under punitive
taxation?
What would you think

man

But

the more you beat
better they be," is an ex-

tree,

pression of that idea.

engine

who, when

wouldn't

Continued

metal workers know, that only
nZTf-

of the business and personnel of

merger

with

DEAN WITTER & CO.

high

result of this merger, effective December 1,1953 the Midwest
Division of Dean Witter & Co. will offer

may

investment service

and

over

whole-hearted

governmental
may,

negligence,

letting

termed "McCarthyism,"

themselves

their

exposure

faith

Communist

the

our

then

embrace^ "McCarthyism"
in

their

American

let

—

heroes,

the

Members

wherever

British

lieu

well

of
as

and

they

least,

trans-Atlantic
and

let not

New York Stock

Midwest Stock

"public

policies

relations"

misinformation!

here

founded

geared

persisting

coddling

"Red

Los Angeles Stock Exchange
Chicago Board of Trade
leading security and commodity exchanges
San Francisco Stock Exchange

•

Exchange

worry

MIDWEST DIVISION

Herring-itis"

—

•

III WEST MONROE ST., CHICAGO 3,

ILLINOIS

Telephone FRanklin 2-0251

their

over

American Stock Exchange

•

and other

SAN FRANCISCO
our

Exchange

authorities

Fuchses/at home.
At

commodity transactions.

Dean Witter & Co.

"hysterical

sympathizers

fall

chips

complete

covering underwriting, brokerage

shouting about

McCarthyism" allegedly exhibited from Hiss to White.

NEW YORK
AND

LOS ANGELES

SEATTLE

OTHER PACIFIC COAST CITIES

PORTLAND

Start,

HARRIS/ HALL & COMPANY

large segments of the

complaining

.To

reacting to the Harry Dexter White

foreign friends.

our

tax.

f®r

Expanded Service for Investors and Industry in the Midwest

anti-McCarthys—from Adlai

circumstances showing governmental negligence, by
the "offense" to

British

so-

oft?n listened to gravely with- govern a people, a tyrannical govbeing given a horselaugh or ernment must demand sacrifices
even a skeptical smile.
The of the people. You must have
money illusion
can play tricks emergencies they say. Hitler ex-

and ideological—

what

Excess

Efficiency Penalty Tax! Profit is
defined in my dictionary as "Accession
of
good; useful results;

of interest in relation to

the

profits Tax might better stand for

opinion of White by Britain's leading monetary authority and fis¬

the attempt in so many quarters here—political

cut

of the horses that did the

are

individ¬

continued

manufacturers,

under

ap-

of ignor-

as a consequence

Personal

are

numerous

have

fundamental knowledge or delib- ciety? I have been told that poerate intellectual dishonesty in litical considerations required that

'.natural thinS to do in an attempt

"pro"-Harry Dexter White from "The Life

Keynes—a

Medium

years

dislocations

(INCORPORATED)

Keynes had

felt

relieve

&ive out opinions on economics, desirable consequences." How can
an(^ more particularly on mone- there be an excess of desirable

address,

through the

t'f

■■■

that

how

situation.

the

White the Fund would be in safe hands."
*

our coun-

Consequently his chatter
is disregarded as that of an ignoin

studies

not be the Man¬

it for granted that he would be, and had

confidence

repose

power.
ramus

blow at the isolated condi¬

but

fact

among

aging Director of the International Monetary Fund.
always taken

lack

laws

untrustworthy. If a fellow
shop talks about increasing

our

[at Bretton

caused

exhibits

ordinary

doesn't

while, but is no more sound pressed that idea, saying that the
period of 5,000 years.
Lack..,of-'than a collection of gears to make people were like a woman, not to
knowledge and
appreciation of a porpetual motion machine.
be treated rationally. The English
those laws can wreck the machinY°u ever ask an inexperi- proverb, "a woman, a dog and a
and

greatly enhanced his reputation."

became

even

soon.

ftM'e^th'e ^mss^Annual^Meeting^of

[formulating the International Monetary Fund

pre-Bretton Woods], which

highly

met."

ever

McKenna

in regard to

years

fallacies

*An

by departmental discussions long before they

our

loyalty of such subordinates

Oscar

who

occupa-

these

[sic], F. Coe, and

daily use of equally
dangerous elecof modern life,

and

the power of a lathe by putting
liberties and our very in some gears to increase the
lives are
in
jeopardy until we horsepower, we recognize that he
correct
prevalent
fallacies
that doesn't know the difference behave operated in this country for tween pounds of force and horseOur

tions,

even

M. Bernstein

to be ig-

were

physics is thrown out of

The lives of

pa-

machinery

Anyone

will

the

knowledge

prac¬

money.

A. F. Luxford. He was also able to count on
support from higher
officials of the Treasury, such as Mr. Edward Foley and Mr. Her¬

and

knowledge

amperes

trical

of being a difficult person to deal with. But he was
single-minded in the pursuit of his aims. He was a reformer [sic]
of genuine conviction. It is to his credit that he won the
devoted

reputation

time

the

complicated

work.
men

the

study.

volts and
nored

ac¬

tical

have

astrous

our

violations

which
monetary
science
teaches, the results may be as dis-

ma¬

Then

few

what to

trouble

Sound Exchange

facts

you

deliberate

economic affairs

Dislocations Arising From Lack of

If people generally do not grasp the elementary

proc¬

shall do

particular felicity of prose style, but he had con¬
siderable fluency, and his earnestness and
passion, supporting sound
reason, made a strong impression on his auditors.
His influence
came

that

tience

must

complish

surely

specific

the whole

What

treat¬

chines
concerned

was

experience of foreign-exchange problems.
During the second
he became the leading figure in the
Treasury ..."
"He had

He did

Agreement, and

with the operations of the U. S.

the

4;^

Treasury was always
important than the

the Tripartite

satisfied

level¬

headed

valuable work

who

man

doing straight¬

knows

who

tion

I of these laws have wrecked both
present-day ancient and modern civilization,
I appeal to you to apply an ancient
time-tested empirical science, one

about

say

economic doctrine to
practical problems. He won

Keynes

not

thoughts.

will, I believe,
be
given
the

apply¬

ing

Lord

will

shallow

economics and

an¬

showed

take

pulling."

privileged to speak to you hands of uninformed leaders, just

re¬

hon¬

marked capacity for

who

figure,

The

more.

Likewise

man

relieve

the confidence

very

be.
a

rather than less credit will be had, when we have
engendered by the gold standard.

more,

man

orable place in British
.

Holds

Far dif¬

should be accorded

nals.

the muscles of the horses that do the most effective

mainly

—

the

what he is

refraining from hammering the
place where the trouble seems to

jeopardy until we correct prevalent monetary fallacies. Says
scrapping the profit motive and competition, resorted to in
renegotiation of contracts and excess profits taxes, is "cutting

dim scribe, some

some

McKenna points out economics,

in
the other

undoubtedly

was

the thinner

the sheet by gently stretching
areas all around the
bulge, wisely

like engineering, has definite laws which should be observed.
Warns our occupations, our liberties and our very lives are

"Public Relations"
.wa.ter^

there and

ens

^he consideration of postwar problems

all

knows

President, The Gold Standard League

In addressing engineers, Mr.

Harry Dexter White

metal

geometry

by arching

President, Kennametal, Inc., Pittsburgh, Pa.

By A. WILFRED MAY

the
of

reasons

metal takes up more area and has
to accommodate itself

HONOLULU

gasoline
took

page

The

(2150)

other

The Outlook ioi

Capital
Expenditures in 19S4

have

New

continue
est

Plans
in

plans

expenditures
higher than most

for

1954

capital

are

to hope for

dared

economists had

earlier this year.

any year up

The survey made

ber

Octo¬

that

reason

much

scheduled for
basis that has

carefully planned for a defi¬

the

that

The

ago.

years

over

of highest importance
of all manufactur¬

80%

capital
expenditure plans for more than
ing plans now have some

may
Robert

within

come

several

case

velopment

group,

spending

purpose.

number

utilities

and

firm

haphazard estimates
that might be subject to drastic
revision was much less. It is a de¬

for

mining

In our recent sur¬
vey, definite capital budgets were
much
more
prevalent than was
nite

19 5 3

that

during

1954

vestment,

whole

been

manufacturi

investment

plan

record

and

decline

drastic

The

in 8% of their

the investment now

spend with¬

Ulin

ahead, and that many are
Thus, total business investment in planning as much as five years
new
plants and equipment may ahead. This type of planning must
well continue higher than in any exercise a stabilizing influence on
of

1 95 3.

year

defense

Plans

Firmest

boom.

Companies

by Big

These figures have

plans have been those of the big

been

sur¬

prise to most economists. But they

actually pretty close to what

are

business firms have been

right

ing

firms

along.*

that

long-term
turns

show

.survey

for 1954

case

budgeting,

It is these
for

re¬

Only

that

present

But

generally within 10%
for 1954, as re¬
ported by these same firms back
earlier

February,
The

plans

fact

ing

this

way,

1953.

that

its

Now

business

investment
after

is stick¬

plans,

decline

these

in
ten

crossing

industrial

the

production,

look.

index

manufacturers'
ders

the

change

let

look

expenditure
detail.
cline

the

ever-present

business firms
threat of

petitive
back

programs

position—not by cutting
sharply
on
investment.

Whether this
the

First, why is there a
plans overall?
Why

competitive

struggle

tougher and results in

financial

casualties

immediate

the

for

There

evidence

with
plans, is
aging factor.
go

ahead,

manufacturing

quick

cut

back

investment

in¬

substantial

vestment

most

encour¬

tj)

O'Neil, Jr. has become associ-

business

mostly

struction

recession.

The

plans for

Gross, Rogers,

and

the

Los

the

Angeles

Stock

Ex¬

change. Mr.
O'Neil, who
has been i'n

con¬

expansion

mem¬

bers

plans at the first sign of recession. capacity.
It is chiefly in indus¬
will, of course, be some tries like steel, aluminum
and
changes in the plans of various
heavy chemicals that have met

invest¬

the

There

busi¬

ment

for many

ness

♦Summary of Mr. Ulin's
ness

sity
Nov.

Outlook

Conference

Michigan,

13,

Ann

paper

the

Arbor,

defense

Busi¬

Univer¬

Next—what

goals.
are

the

reasons

for

continued

1953.

high level spending in

has

years,

R. O'Neil, Jr,

Hubert

recently

Michigan,

been

with

Fairman

Display

private

and

Dow-Jones

projected

utilized

Wall

telephone

the

New

City,

New York

the

York

Stock

Exchange, to (ell the public the
story of a brokerage house in ac¬
tion, at the New Jersey MidAtlantic
tion

Farm

Hall,

Show

Atlantic

Conven¬

City,

J.,

Described

first

the

and

pos¬

sibly biggest of its kind,The MidAtlantic Farm Show is officially
sponsored by the New Jersey De¬
partment of Agriculture
eration

with

Delaware

Bache
affair

Exchange and Other National Exchanges

of INVESTMENT SECURITIES

Private Wires

•

STOCKS, COMMODITIES

Home Office: Atlanta

will

Scotch

and still displays

banker,

extraordinary capacity to

Maryland.
display
set

coop¬

agencies

Co.'s
be

earn

ownership

Pullman

had

latter

These

the

and

operation

been

cars.

progres¬

•

Phone LD-159

securities

the

at
part

public. The exhibit

commodities
and

staff

Now
roomette

cars,

have

with

bed¬

and

multiple

Pullmans

the

but

are

unit

business

tion

railroad

the

longer

owned by Pullman, Inc.

That

sec¬

sold

was

out

in 1947.

group

well

members

hand

explain to the visiting public just
markets

operate

Standard

building

the

end.

1952, Pullman Standard de¬

livered
of

commercially

(excluding

cars

U. S.

still

freight cars, 44%
built freight

21,630

all

This

tankers)

serves

the

to illustrate the

commanding position of Pull¬
in the railway field.

But

bed

that

mean

become

enterprise.
ushered

bed,

the

new

shadowed

wider horizon.

fore¬

and

era,

varied

late

did
was

contrary,

and

Pull¬

1944

Inc. took over M. W. Kellogg
leader in design and

man,

Company, a

industrial

plants,

especially in the oil and chemical
This division has expanded;

field.
it

makes

catalytic refining plants

companies;
a

process

products; and, in

Jersey

called

out

ond

This
of

over

great

June,

use

has

cash

Inc.,

sec¬

largest truck trailer producer.
unit, it paid for in cash out

its

Pullman

1951,

Trailmobile,

own

That's

treasury.

characteristic

always

position.

short

and

watched

ever

box

cars,

you

unit

standardized
lower

cost

and

nance

ap¬

can

P-S

provides

purchase,

operation.

50,000

over

mainte¬
told,

All

box

cars

are

clicking along behind locomotives
56

roads.

of all

74%

were

commer¬

in the U. S.

cars

P-S l's.

other types, Pullman Stand¬

ard unveiled in June
to

special flat

truck trailers.
The
New Haven RR. has developed a
car

carry

substantial over-night trailer

haul

York

and

traffic

new

future

number of western

have

roads
this

New

between

Boston; and

taken

flat

trailer

the

interest

The

freight movement.

car

ap¬

highways get more
congested, and the price of truck¬
ing labor advances, monotonously.
Moreover, this is a nice sort of

pears

bright

with Trailmobile.

tie-in

Pullman,

stressed

Passenger Car Orders

new

Kel-F.

Then
took

you've

preciate the value which the now-

plant

new

turns

material,

of produc¬

year

to desulphurize

oil

City,

the world

owns

sixth

big and little, short and tall, long

in 1952

lesser

car.

that is)

Pullman, Inc.

contracted,

the

cially built box

Pullmans

the

railroad

not

putting

is the fact that

Of interest also
1953

Company Business Varied

one

Inc.—

strong
Although Trailmo¬
a

the rail field Pull¬
offered its P-S

Finally

has this year

man

(P-S 2 was a closed hopper) to
provide the uniformity in open

hopper
boxes.

achieved

already

car,

With freight cars

being

tired at the rate of 5,000 a
the prospect

last 60

came

month,

of sustained car man¬

ufacture appears
the

in
re¬

good; and within

days, the New Haven

for

market

the

into

100

bile, Inc. has not been long in the
Pullman
fold, it has proved
a
dition.

(and highly logical) ad¬
Trailmobile developed the

all-aluminum

this
specially

spring
new

the

transport

trailer,
year

and

announced

designed
liquid

unit

securities

arid
and

what

they play in the national

role

economy.

Established

1856
A

the
a

for

H. Hentz & Co.

propane

Members

gas.

units

are

distrib¬

Stock

York

New

Exchange

Stock

Excnuu*#

Cotton

..uerlcau

Exchange

uted

by
51
sales
and
service
branches; and the Canadian sub¬

business in

The
has, in addition to being
big factor in supplying commer¬

highly satisfactory manner.

York

New

Commodity

Chicago
New

Orleans
And

Inc.

Exchange,

Board

Cotton

other

Trade

Exchange

Exchanges

company
a

commodity

Pullman

and

eagerly at work

moment,

shy of this

freight train roll by and noted the

City
how

the

70,000

cars

nocturnal aisleway

cial

will

1954.

America

goal of 1,850,000
some

con¬

past

tion of the P-S 1 standardized box

the firm's New York and Atlantic-

offices

the

decor, dangling chandeliers, early
American
plumbing,
contorted

ited, is expanding its

the

man

sidiary, Trailmobile Canada, Lim¬

been profitably

functionalized since those
halcyon
days of the
"Pullman
Palace Car" with its ginger bread
sively

Trailmobile

firm's
continuing campaign
explain the operations of Wall

features

target;

For

Up until 1945, Pullman had de¬
voted its entire effort to railway

car-building

are

produced
swings in earn¬

railways

end

they

and pay dividends.

money

and

the

largest manufacturer of rail¬

Street

UNDERWRITERS and DISTRIBUTORS

BROKERS of BONDS,

State

and

have set

still

has

and

each

The

years.

the

Established 1925
Members New York Stock

it has

Pullman,

cyclical,

business

valuable

Dec. 4 to Dec. 9.

BANKERS

ings,

ducted

right

left,

way cars on this planet, still has
a
balance sheet acceptable to a

news-ticker

giant screen will
Bache & Co., 36

Street,

members of

INVESTMENT

rather wide

though

Even

the

quite

chemical and electrical industries,

network

some

Inc.

plastic

At N. J. Farm Show

section

Ira U. Cobieigb

for oil

Co.

line.

major

this

bank¬

from

right to

Bache to Have

a
rail-

century-long
political trend

construction

their

Freight Car Business

still

batch

ruptcies, and

South

F i g u e r o a

Street,

make

can

Standard Car Manufacturing Co. is

w a

Barbour,
& Co.,

559

crank

pressions,

Smith

decline

new

with

operating

transformation.

Huge

four

plumbing, radios, adjustable heat,
air-conditioning and
ice water;

The Financial Chronicle)

the

hundred

room

ANGELES, Calif.—Hubert
a

man

and

business

streamlined

(Special

cycles and de¬

informalities.

Gross, Rogers Firm
LOS

excel-

wars,

cusroDing, and

H. R. O'Neil Jr. With

wide¬

1949

were

the

outlook,

de¬

firms

some

question

willingness of business in general

spread cutbacks in anticipation of

be¬

that cannot yet be answered. But,

any

firm,

recently

continue

will

trend

loca¬

into

Big and expanding as are the
operations of M. W. Kellogg and
Trailmobile, the building of rail¬
way rolling stock by the Pullman

cut

by investing
improve com¬

trial

reacting to the

will

e n c

being well
develop¬

recession

that

ways

can,

20 loot

m a n-

produc-

o n,

After

or¬

In all these ways,
are

along the highway,
be expanded

office, living room, or dor¬
mitory. This change doesn't re¬
quire a platoon of guys; just one

agerial
1

century

progress.

profitabi lity.

new

drive

capital

the typical behavior of the indus¬

since

t i

roil¬

company,

tion,

classic

into

fields and, of course,

new

operating costs.

progressive

example

rapid

Pullman, Inc.

products, the desire

new

to enter

the

and

investment

—

sustained
ment

sales

very

represents

impartial viewer of Ameri¬

corporate enterprise is bound

cite

—

industrial decline? In manufacturing, this is
important mostly related to the completion
factor in the general business out¬ of defense
expansion programs.

points

The
can

good

over,

with

fields

famous manufacturing

the economic tides through

production and

growth prospects. The industries
which are outstanding in this re¬
gard are automobiles, machinery,
electrical
machinery
and
food
processing.
In brief,
we
have a situation
where
despite some drop in

in 1954.
the larger

mostly

are

companies. And some of the very
largest are raising expenditures
substantially.
This is the main
support for capital investment.

plans

are

ing forward with

sustained

raise capital expenditures

McGraw-Hill

latest

the industry leaders.
companies that account
the bulk of capital spending.

companies,

40% of the manufacturing
of companies participating in our re¬
of cent survey plan to maintain or

practice

capital
the

the

make

budget¬

"Winning in Wall Street"

A Pullman-car view of

capital

other

comes

Generally speaking, the firmest
Surprising Figures

items,

1953, which repre¬ capital expenditures.
the extraordinary peak of

sented

the

year

Author of

behind plans for

Big companies particularly are
in line with business planning to diversify their manu¬
developments. But it now seems facturing
facilities,
either
by
very unlikely that there will be bringing
out
completely
new

indus¬

now

By IRA U. COBLEIGH

sus¬

companies,

shows

turing

not

ucts, and the expansion or diver¬
sification of existing product lines.

1954.

that manufac¬

tries

to 1953

expenditures

McGraw-

Hill

economists

spending
in
1954.
This
includes
completely
new
products, more capacity for
recently developed growth prod¬

peak. Notes firm¬
have been those of the big industrial leaders.

higher than in

could

reason

level

high

indications of recession, total busi¬
plants and equipment in 1954 may well

investment in new

ness

investment

many

products appear to be the

principal

McGraw-Hill Publishing Company

Mr. Ulin finds that despite

thought

Wide Awake Pullman

the

are

tained?

ULIN*

By ROBERT P.

What

continued
that

level

particularly

lines?

for

reasons

Department of Economics,

industries,

consumer

Commercial and Financial Chronicle.. .Thursday, December 3, 1953

over-the-road

haulers,

been

for the
government.
It has turned out,
among other items for the Army,
an expansible truck trailer, which
while not out-size when rolling
important

contractor

N. Y. Cotton

Exchange Bldg.

NEW YORK 4,
CHICAGO

DETROIT

GENEVA,

N. Y.
PITTSBURGH

SWITZERLAND

Volume 178

Number 5278

The Commercial and Financial Chronicle

...

(2151)
*ri

•

? »t

'* *

■

streamlined passenger cars—Pull¬
man

built,

Put

that

the

above

billion

Pressure

is.

three

units

sketched

together, and

you wind up
fairly balanced enterprise
with about 40% of
earnings from
Kellogg, 40% Pullman Standard,
with

Mr.

Net for the

common

projected at around $5—this after
$1.80 of E. P. T.
A

word

should

said

about

the common

stock, for it's unique
a number of
ways. First of all,
this
common,
together with its
predecessor
(the
old
Pullman
in

Company)
88
.

statism

been

Pullman

row.

its

groups

have already forced

have weakened

may

called security."
In

addressing
loan

of savings

groups

prior
to
November, 1952. I have been frebegun in 1944,
quently
c h i d e d
for
has been financed
injecting
entirely out of
politics. So, as
Pullman's
liquid assets—(earned
a
Republican
surplus plus cash from sale of
appointee, toPullman Company). This is quite
unusual,
sort

program of diver¬

most

involve

day should be

of this

mergers

exchange and in¬

This

leads

Whereas

panies

find

stocks

and

point.

other major

many

com-'

the

it necessary to offer
bonds to provide ex¬

(sole

man

capitalization)

McAllister

science

ernment.

Stock

Thus

Better

Than

the

Ever

Certainly

without almost

that

still

abolish¬

salary controls.

for

practical

One

it.

curbed.

return

can

law.

Thomas

remain.

Metal

with

our

Jefferson

daily

wondered
to

ness

fifty

was

skip

the

be good

may

controls

are

elim-

You

lives.

the

progress

I've

tician,
should

electric

for

greatest

his

effect

lives

our

facts

nation's

in office.

Americans

Republicans

are

This

not

whether

his party

welfare,

should

must

they

Democrats.

ac¬

poli¬

consideration

basis
or

basis of

With

action

every

com¬

monop¬

its power

economic

the

Politicians
before

its fields of

first

the

but

the

keeps him

Programs that give promise of
the

h i
be

life,,that
and

field

widened.

are

about

talk
and

often

ability of busi¬
in spite of gov¬

the

increases, i.e.,

damper

some

are

tivity

Government Studies in Process

our

cer¬

ernment.

while public housing
the moment is quieter,

their

Government is best which governs
least."
That
is, interferes least

pur¬

hundred

Korean truce—that
bad.

All

develop

—

service rendered

recent months many of you have
said, "Fine, let the Administration

accom¬

power,

must

officers

characteristics

politi¬

alike.

petition—government is a
oly and grows not on. the

the resultant ruinous taxation that

for

All

become

sand,

What

(2)

task this Administration

applied

tion

gov-

loan

business

accepted

government

which,

daily contact with three

the

with

within

the

reins

two

cover

the prestaxa-

(3) The elimination of Federal
government

from

the

fields

simplification

is not said criti¬

(4)

Further

government

ference

tempt

naturally
in

the

Dirksen

bureaus

return

and

latter

dif¬

time.

"power"

that

change. As Senator
truthfully said, "Big
is

the

road

to-

tyranny."
And

at-

Federal

many

the

individual

"authority"

makes

now

produces

government

private enterprise,

—just
It

tion.

commitments

A study to

division of the fields of

ent

are

but

officer—and

bility in the field of housing,

„

The Task of the Administration

beginning
to
realize.
The
Republicans promised tax reduc-

no man can

savings and

the

cost of expanded government and

control

is gone.

time

law-enforcement
the

place, it is the

humans.

reduction

have

control

tainly right when he said: "That

besides

Rent'

you,

relationship to the law.
You, as ordinary citizens, have
these^ but one prerogative—to
obey the

under

Republican

cians

thousand have been dropped from
the payrolls— that is a bare start.
Two million four hundred thou-

and

h is the

term

the

be in

can

h i

just

poses

faces, how superhuman they must
ignore politics, be to accomplish it, I think some

has

192,000.

business
W.

taxes!

skeptical

inated and certainly
has
been
put
on
socialized medicine

must

tell

expansion

have

common

been reduced from
3,820,194 to 2,-

over

crats or Republicans, as the case
may be, have largely approved the
Republican domestic program. The

calls

Let

unless lower

—

ment of wage and

last December, 2,563,000.
you
businessmen, Demo-

livesthan

drastically reduced its
outstanding stock by buying and
retiring same. In the last 15 years,
number

have

•

plishments

will

Draw

becomes

but

other

spending,

Now

quit.

respective businesses—all is well are these studies currently being cally—I am merely! speaking the
government on the Potomac," How wrong you m?>de:
psychological truth, but being a
our
daily may be I will attempt to show.
(i) The government's responsi- politician or a law-enforcement

has

outstanding

you

disturbed

pansion capital, Pullman, Inc. has
not only done all that
internally

one

has been

third

our

exception,

of shares.^

crease

but

and

larger

and

produce

happened,

For

June, 1950 before Korea, 1,966,000;

acquisition,

much

will recur.

of pottage,

mess

billion.

deficit

our

conditions

Reviews situation in Savings and Loan field.

executives

reduction,

rates

has

"uppers."

and

Secondly, the

sified

deficit of $4

tax

moral fiber that "we

our

pitch personal liberty out the window for

has paid dividends for

years

never

Bank

pressure

I'll

nature

given,

backdown
from proposed policies. Accuses bankers -of having forced
Administration to drop its "hard money" policy and to return to
a
"managed market." Cites opposition of farmers against plans
for eventual abolition of price supports.
Warns New Deal
some

ing,

though, it is hard to keep from
becoming more and more auto¬
cratic. In the first

executive, after reviewing efforts of
Eisenhower Administration to effect reforms in the economy,
says

taxes

1953—$68.3 bil¬

your own conclusions!

that

Home Loan

ing

Chairman, Home Loan Bank Board

New

Carry, President,
at the $400 millon
level, with a
new all time
high in earnings be¬

The most

collected

ever

billion for

lion estimated for this year, leav¬

By WALTER W. McALLISTER*

Champ

fore taxes.

is $65

Administration's Policies

and 20% from Trailmobile. Com¬
bined gross for 1953 is estimated

Groups Disrupting

iS.ii

of expenditures.

have

■

you

here

know

another

have

point.

innumberable

requests to get

a regulation passed
prohibit this, that, or the other
thing? We Americans just natu¬
It's
an
old
story but let me
to determine a
rally want to correct the other
again point out that our founding are the previous Administration's
£orejgn trade policy,
fellow by passing a law. We would,
lar dividend seems to be
only a fathers established a representa- unpaid
expenses for which
no
Though a fine start has been like to squash competition by a
60% payout of earnings. (There's tive form of government called a taxes
have been provided, yet
a
made,- always remember the op- regulation.
$1
year
end
extra
payable Republic. It was not a Democracy, they must be met.
Maybe after 20 years of look¬
12/15-53.) The yield at 12% is a They attempted to set up such a
After lopping off $14 billion Position we give to going it alone
ing to the government to see thai
comfortable
7%.
At
Sept.
30, system of controls and delegation from the Truman budget,, for the and
economy
we
are clothed^ fed,
and housed
1953 the net working capital was of
powers limited by the Consti- year ending June,
1954, we will ^ ™ applied to projects we favoi.
according to some welfare worker
a cushy $52
a share.
Book value tution so that a
Democracy, or still spend $59 billion. Of the $81
There is one thing I promise you or
do-gooder's standards, we have
at the 1952 year-end was
slightly a government by majority rule billion, $13 billion is expected to —I will not become a professional
above $70; so it is rather easy to
Continued on page 35
could not be established. Certain fall due in 1954, so we'll have $72 bureaucrat! If 1 feel myself changinfer that a purchaser of PU (the
rights of the individual were al¬
company should sue this symbol
ways to remain inviolate.
for libel!)
in today's market is

lot

be advanced

logic might

now

suggest that Pull¬
man, Inc. is a better stock today
than it's ever been. The $3
regu¬

government.

come

years

at the most,

will be-

functions

the

States

and

mu-

due-bills for $81

billion, un- nicipalities.
less contracts are cancelled. These
(5)
.
attemot

to^governmenl.

not

made

trial

price level.

gaudily

Nearly

inflated
indus¬

reviewed

company

every

these

days, must give

some account
its status in the defense effort.

the

case

orders

PU,

amount

last year.

20%

same

Some of these contracts

subject to renegotiation; but I
believe
no
excess
profits were

and

similar

refunds

requested,

1951, and 1952, defense

contracts.

ers

and

of Tiffany

impress

Pullman.

to dividend
man

durability

century

sheets

ance

you,

you're

bal¬

you'll

allergic

lulls, you'll find Pull¬

therapeutic. Long-term hold¬
Pullman

teenth Amendment to

have

ridden

the

our

first

This

The

income

and

Then to finish

Seventeenth

ing

popular

election

Acceptance of the Marxian prin¬
ciple of control
over
the indi¬

\$25,000,000
Tennessee Gas Transmission
First Mortgage

vidual's income and how he could

dispose

his

form

the

change in
The

power

our

Dated November 1,

cedure
so.

World

War

II,

for prudent

investment

taxing

powers

of the

preme

land sthat

our

Federal

Price 101.579% and accrued interest

Federal

The

Financial

The

su¬

for practical purposes.

January,

had

The

BRIDGEPORT, Conn.—William

B. Moore is with G. H. Walker &
was pre¬

viously with Hinck Bros. & Co.

daily

lives, that
bureaucracy
should

our

HALSEY, STUART &. CO. INC.

change in

new

Admin¬

the
be

ernment

has

grown

evidenced

by the number of civil employees
1913, 470,000; at the end of
World War I, 918,000: June, 1930,

(Special

The

Financial

CHARLOTTE, N. C.—Elinore I.

curities

staff of Interstate

Corp.,

Commercial

Hoover

000;

Chronicle)

tSmith and" John G. Wheelock have

joined the

the

Se¬

Building.

Na¬

Administration, 614,-

before

World

War

World
yAn

War

II,

address

3,770.000;
Mr.

McAllister

low,

Savings and Loan League, Chicago,

Nov.

24,

1953.

MERLE-SMITH
SALOMON

AMERICAN

CO.

HALLGARTEN

BLAIR, ROLLINS &, CO.
INCORPORATED

L. F. ROTHSCHILD

CO.

BROS. &

SECURITIES

WERTHEIM

HUTZLER

CORPORATION

A. C. ALLYN

CO.

AND

COMPANY

INCORPORATED

F. S. SMITHERS &

COURTS &.

CO.

STROUD

CO.

COMPANY

INCORPORATED

AUCHINCLOSS, PARKER &.
WILLIAM

BLAIR

ILLINOIS

COMPANY

SHEARSON, HAMMILL &. CO.
December 3. 1953

BAXTER, WILLIAMS &. CO.

REDPATH

THE

before

the 61st Annual Convention of the United

111.,

DICK

II,

926,000; June, 1945, at the peak of

States

tional Bank

1939,

INCORPORATED

shrunk

—in

Two With Interstate Sees.

A. G. BECKER

BEAR, STEARNS L CO.

swollen

size, and that taxes should
markedly reduced. How gov¬

Prospectus may be obtained in any State in which this announcement is circulatedfrom only such
0/ the undersigned and other dealers as may lawfully offer these securities in such State.

the

istration believes the Federal gov¬
ernment should have less to do with

Chkonicle)

Co., 118 Bank Street. He

today
all

government- is

Administration.

(Special

government authorized in the Six¬

money.

With G. H. Walker

only

ment

to provide a quite safe berth

Due November 11973

-"jjf

As the result of that and

market "sleeper," it

pears

1953

may

Pipe Line Bonds, 4% Series due 1973

con¬

govern¬

in World War I,
the same pro¬

necessary

followed

laid

Company

ment,

the

for

government.

centration

was

wealth

exactly

ap¬

buy these securities.

Senators.

Pullman

tagged

taxes.

adopted the

Amendment, provid¬

the

for

inheritance

off,

Amendment, we have so
changed the economy and govern¬

offer to sell or a solicitation 0/ an offer
offering is made only by the Prospectus.

not an

Consti¬

class, financially speaking. While
not

Six¬

teenth

announcement

tution, providing for the collection

groundwork

corporate

nearly

on an even

objectives

adopted

are

cited,

these

bear

until

of
In

government

which is about the

gross,

mind

1953

to around

managed to keep

keel,

when

GREGORY &, SON

HIRSCH

CO.

INCORPORATED^
NEW

HANSEATIC CORPORATION
P
>
•:
>15 W

YORK

STERN BROTHERS & CO.

VAN ALSTYNE, NOEL & CO.

The Commercial and

(2152)

Light

Puget Sound Power &

—

Memorandum

Co., 120 Broadway, New York 5,

story—let's

see

how

salesman

securities
number

had

his

accounts

Company—Analysis—Van Alstyne, Noel &
York 5, N. Y.
Stromberg-Carlson Co. — Memorandum — Rotan, Mosle &
Cooper, 705 Travis Street, Houston 2, Tex.

Sears, Roebuck &

Co., 52 Wall Street, New

purchase

he
suggested that the
in question was applying
increase and if it Aftere

company
for

rate

granted

would

development.

favorable

Some

his

tomers

bought the stock
reluctantly, yet they had
Aviation

Stanley Heller & Co., 30 Pine Street,
Also available is an analysis of Finance

Analysis

—

York 5, N.

New

—

Companies.

Notes

NSTA

in¬

companies offering

list

Securities—Selected

Canadian

potentialities—in current issue of "Gleanings"—
I. du Pont & Co., 1 Wall Street, New York 5, N. Y.
the same issue are suggested "package" Portfolios.

teresting
Francis

Also

Gains

Capital

Program

subscription

Free trial

—

Homer

—

Fahrner, Corning, Calif.
Commission

booklet

rate

Broad

—

Street,

York

Stock

Y.—single copies 60 cents

Exchange—New
Exchange Firms 24,

request).

current

Stocks—Study

Japan—Circular—Yamaichi Secu¬
Ltd., Ill Broadway, New York 7, N. Y.

Investment Opportunities in
rities Co..

City—Discussion

Kansas
D.

McMahon,

possibilities in

industrial

annual Christmas Party

area—

Lines, Kansas City

Southern

Kansas City

able

up-to-date com¬

parison between the listed industrial stocks used in the DowAverages and the 35 over-the-counter industrial stocks
used in the National Quotation Bureau Averages, both as to

Jones

yield

and

National
York 4,
Personal

Property

Free

Euper, Akin-Lambert Co., Inc.; Frank Link, Harris, Upham
and Gordon B. Tuttle, Gross, Rogers, Barbour, Smith &

Building, Pittsburgh

& Co.;
Co.

recent meeting of the

Nominating Committee, composed

Robinson-Humphre.y Co., Chairman; Wayne Martin,
Clement A. Evans & Co., Inc.; Hugh D. Carter, Jr., Courts & Co.;
J. Robert Neal, Wyatt, Neal & Waggoner; and Julian W. Tindall,
J. W. Tindall & Co.; the following were unanimously nominated
of Lex Jolley,

Association for the year 1954:.

be officers of the

President:

Tax Saving Possibilities

Bulletin

—

•

120

Dillon & Co., 15 Broad Street, New York 5, N. Y.
available is an analysis of White Motor Company.

and

who

Hospital Supply Corp.

Turben

Ohio.

&
•

Co.,i Union

J )

•

Bettinger Corporation

Building,

bought it.
she

Sharpe

Manufacturing

Gannon, Inc., 161 Devonshire Street, Boston 10, Mass.
available is a memorandum on Scott & Williams, Inc.
Circle

Wire

Cable Corp.—Bulletin—DeWitt

Conklin Organ¬

ization, 100 Broadway, New York 5, N. Y.
Guaranty Trust Co. of New York—Bulletin—Laird, Bissell

Corp.—Memorandum—Auchincloss, Parker & Red-

path, 52 Wall Street, New York 5, N. Y.
I.

Circuit Breaker

Investors

Diversified

Hanseatic

Services,

Corporation,

120

5, N. Y.

Inc.

Broadway, New

Also available

the
Iowa

is an analysis of Metal
Municipal Market.

Public

Service

Company

mittee for

—

New

Hancock

Roy

York 5, N.

Y.
and

the

Wall

and

Broad

National
Boston

Polaroid

Tea

inations for the officers and must

Associa¬

the

make nom¬

may

their nominations

announce

Secretary-Treasurer not later than one week prior to the
election, which has been set for Dec. 11 in the Grill Room

annual

Capital City Club.

The
5

business

election

and

officers

will

p.m., followed by cocktails and dinner. Reservations
not later than Dec. 4 with Justus C. Martin,
Jr.,

start

should be

made

Robinson,

thinking of "switch¬
attractive and he
she should
leave
well
also

Special study

—

Dreyfus and Co., 50

good markets in

Haupt & Co.,

Ill

say

life

sell

that

When

385

tion

write

•

you

with

Industrial Stocks

Security Dealers

Trinity Place;

de¬

financial

weeks

Situation

later

first

turned

and

her

over

step in obtaining this
that

was

rity

was

sold originally. Secondly,

salesman

informed

after he

ress

could

the

build

additional

judgment

particularly ben¬
he

This

you

—

the

will

procedure

that

asset

the

put

ahead

welfare

from

have

customer,

commission.

invest¬

would

his

but

have

not

efited

take

which

salesman

would

investment.

the

led

have

commission

customer

the

question was asked

decision

made

secu¬

company's prog¬

sold
a

ment

good

kept
the

Third, when

SAN

one

can

satisfied

and

will

the

Asscciattcn

New York

N. Y.

once

president

other

officers

contact
re¬

companies

will find that you will receive
cooperation and information that
you

you

that
NY l

can pass

will

ing to them.
ciated

along to your clients
official

interest¬

This will be

because

376

and

places

appre¬

you

uation,

and

sometimes

you

can

your

custo¬

Morris,

Calif.—
has

Jr.

become

California Street.

the

(Special

The

Anita

Result

the

Pisarro

staff

Chronicle)

Financial

BRIDGEPORT,

they make the sale
all about the custo¬

forget
What

whom

gives

surprise it is,- when
while
someone
from
a

have made a purchase
a
telephone call and

you
you

to know if
everything is satisfactory; are you
pleased,
is
there anything
you
"I

says,

would
need
new

want

have

like to

think

pleased
happened

do, do you

adjustments

any

stove,

happens
I

just

Conn.

Mrs.

—

been

has

added

Dacey

Norman

Associates, 114 State Street.

your

rarely these days that

most

when
to

TRADER-SALESMAN
Long established over-the-counter house
with

people
it

are

occurs.

very

This

security salesman

substantial

perienced
lished
of

investment
use

should

find

who

firm

estab¬
partner

can

and

ex¬

with

owner

capital

trading

plete

seeks

capital

trader-salesman

clientele.

ably

profit¬

our

com¬

research
facilities
offer specially attrac¬

and

our

tive.

Drawing Account $150 Weekly
against liberal commission

television set?" This

in a

position of being close to the sit¬

After

dollar.

mer.

news

Today the world is overflowing
people
selling goods
and
services who only think of today's

them about it.

tell

Chronicle)

Financial

with

your

establish

The

With Norman Dacey

good

Here

they

telephone

FRANCISCO,

bot, 519

before anyone else.
!

mers

af¬

company's

which you and your customers
have an interest, in most instances

Troster, Singer & Co.
2400

orders & inquiries invited

this

and

dividend

customers and

Natural Gas arid

regarding

sponsible

Members:

count

bring

case in point.
After you
security, keep your customer

posted.

HA 2-

it is the little things

clared, when earnings reports are
made public, or if you have re¬
ceived other
pertinent informa¬

Utility

your

that she

advice^ She then made
appointment to discuss her

That Little Extra-

fairs,

•

stated

pleased with such

connected with Hannaford & Tal¬

JOHN DUTTON

another

Light—Review—Ira

Broadway, New York ft, N. Y.

Public

she

result

even

account

Securities Salesman's Corner

First

Broadway, New York 4, N. Y.

•

good investment, the

Joins Hannaford & Talbot

They

We make

finally told her that he

was

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

making

was

James

Union Fire Insurance Company—Analysis—The

Power

loyal clientele.

Street, New York 5, N. Y.

Puget Sound

Instead

customer's

meeting

Co.—Memorandum—Hemphill, Noyes & Co., 15

—

she

—

Co.—MemorandumL-Smith, Barney & Co.,

Corporation

and

of her other stocks

one

was

she

that

According to the constitution and by-laws
tion, any other five members of the Association

Humphrey & Company.

Street, New York 5, N./Y.

National

this

Then

thought

buy some more of the utility
since the outlook was so

(Special

Oil

done

idea.

the

period:

same

Analysis — The Milwaukee
Company, 207 East Michigan Street, Milwaukee 2, Wis. Also
available is an analysis of Rhinelander Paper Company.

Kewanee

the

him

The

James B. Dean

Clarke, Johnson, Lane, Space & Co.; James F.
Milhous, First National Bank; F. D. Willis, Merrill Lynch, Pierce,
Fenner & Beane; John E. McClelland, J. H. Hilsman & Co.

York

& Thermit Corp.

Means

Harrison

of the

Study

—

The following were nominated to serve on the Executive Com¬

the

Co.—Memorandum—Kidder, Peabody

& Co.. 17 Wall Street, New York

had

she

portfolio to this salesman.
James

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

the

stock

few

Also

after

never

liked

entire

Aetna Securities Corpora¬

Co.—Memorandum—May

one

She said that her other

had

asked

tion, 111 Broadway, New York 6', N. Y.
Also available is a
on Mindamar Metals Corp. Ltd.
&

his

been

unbiased

memorandum

Brown

had

f
—

also

was

investment

broker

—
Merrill,
Cleveland 14,

Analysis

—

it.

one

who

enough alone, at least for the time
being.

Also

Memorandum

—

Commerce

later

he had kept her advised

way

the

was

American

days

accounts

thought
:

Theatres—Analysis—East¬

man,

did

sent

rather reluctant original pur¬
chasers of the utility stock, tele¬

ing"

Broadcasting-Paramount

increase

doing business with another firm,

one

rate

thought that, although her utility

Broadway, New York 5, N. Y.

American

Several
newer

tion

111 Broad¬

Sutro Bros. & Co.,

the

He again
postal cards announcing

out

stock

—

the

their

some

quick decision this salesman asked
some
questions about her situa¬

New York 6, N. Y.

way,

effective.

improved.

Secretary-Treasurer: James B. Dean, J. W. Tindall & Co.

19, Pa.

"Quality" Stocks—Bulletin—Granger & Company,

customer

generalities,

other related matters.

day

and

Hancock, Hancock, Blackstock & Co.

& Lynch, Union

Leonard

One

should sell

Means, Courts & Co.

J. W.

price

become

the
a

about

holdings,

Occasionally

telephone

chat

phoned him and thanked him for

GEORGIA SECURITY DEALERS ASSOCIATION

Dividend Paying Stocks—

Long

issues—Moore,

Green, Pledger & Co.
Members of the committee in charge of the party are Thomas

Vice-President: Roy W.

Tax

180

will

Cocktails

Angeles).

Robert M.

mailed to

New York.

Tabulation
Trust

13-year period—
Front Street, New

market performance over
Quotation
Bureau, Inc., 46

(Los

followed by a buffet supper at 7:30 p.m. Tariff
and guests is $15 each. Checks should be made pay¬
Security Traders Association of Los Angeles and

the

showing

served at 5 p.m.,

5, Mo.
Over-the-Counter Index—Folder

hold its
Dec. 18 in the Buffalo and New York

Statler

Hotel

the

Rooms

for members

issue of "The Exchange"
magazine—annual subscription, $1—The Exchange Magazine
Dept. C, 20 Broad Street, New York 5, N. Y.

Common

would

and

Security Traders Association of Los Angeles will

The

Stock

York

New

Association

New

(quantity prices

earnings reports issued
by the company. He had his office
type these earnings on a "postal

market

the

Rates

bit

confi¬

his clients

card and mail them.

OF LOS ANGELES

cus¬

dence in the salesman and fol¬
lowed his suggestion. Each month
thereafter he continued to send

he
SECURITY TRADERS ASSOCIATION

public utility operating stock, and
at the time he recommended its

literature:

parties the following

send interested

This
sold

mentioned will he pleased

understood that the firms

true

it worked out.

Boston 9, Mass.

Office Square,

Recommendations & Literature
It

—it's

Josephthal &

N. Y.

Company—Analysis—Lerner & Co., 10 Post

Riverside Cement

Dealer-Broker Investment

—

Financial Chronicle... Thursday, December 3, 1953

Replies

will

held

strictest

con¬

fidence.

Box

cial

York

& Finan¬
Place, New

123, The Commercial

Chronicle,
7,

Park

Number 5278... The Commercial and Financial Chronicle

Volume 178

(2153)

The

What the Next Ten Years

17%
lion

population

May Have in Store for Us

will

consumption

increase

reach

The annual rate of spending for

increase

kilowatt

100%

Haines, after revealing

background

population

decade in construction, automatic heating, air conditioning and
other fields, makes predictions for coming decade, among which
are: (1) use of atomic energy to create electrical power, and to
drive ships, airplanes and submarines; (2) commonplace use
of air conditioning; (3) replacement of many metals and build¬
ing materials with plastics; (4) advances in electronics that
will make power and signal transmission without use of cables,
and (5) replacement of vacuum tubes by transistors.

Before discussing what the next
ten

us, suppose we

past ten years.

Most of

may

realize

Automatic

the

making

the

each

the

units

three

number

ad¬

residential

central

taking

place.

rose

use

developed in¬

the

past

type of heating system and panel

ten

has been

John

Haines

Fof example^

during

period from 1943 to
gross national product,

10-year
the

which

the

includes

United

from

the

$293 to $348 billion based upon
value of the dollar in 1951.

in¬
creased from $150 to $213 billion.
Consumer

The

expenditures

the United

population

increased from 137 million

States

people.

to 160 million

consumption of electricity
115% from 186 million

The

air conditioning units in¬

increased

million kilo¬

kilowatt hours to 400

ten

field

the

construction, school construction
increased from $216 million just

than $2,150
much

before the war to more

billion in 1953—ten times as

There

hospital

exists

starts to

870,000 in 1953.
Multiple
dwellings or apart¬
ment houses rose from 68.000 liv¬

The

have

and if

hotels

few

do much traveling yon know
hotel
congestion which
and the need for new ho¬

the

exists

particularly

cities.

However,

the

hotel

ten

years

ago

and

will

in 1953.
billion
per year was being spent for roads
and highways during the begin¬
ning of the last decade and more
than $3 billion will be spent in
spend nearly $4*/2 billion
Slightly more than $1

need for new office

build¬

has increased the annual
spending from a little more than
$100 million to more than $500
million in 1953.
■
Total new construction of all
.

types
of $12

V2 billion in 1953—

Automatic

Conditioning:

much.

The

Air
of auto¬

and

Heating
use

address by Mr. Haines before the
Nebraska Chapter of the
ciety of Heating and Ventilating c-ngin
An

Ame"0^n So-

Omaha, Neb., Nov. 10,

1953.

air

commercial

increased

sold

And the

1953.

industrial

units

sold

air

Multiple

dwellings

ing the past few
tinue

demand

rise

have

The

with the

modern

hotels

country

and

new

all

ing the next 10
hotel

motor

started and

will continue

condi¬

Utilities expect

billion

retail

roads

and

many

new

dition

billion

per

the

this

present
year
for

volume

billion

compared to $2 billion

responsibility
which will

that the

tre¬

meet

public has

every

and

war

skirts

defense

the

later

pro¬

stimulated engineering and

gram

research during

the past ten years
the extent that the accomplish¬

would

ments

probably have re¬
least 25 years under

locations in the out¬

cities

communities
local
office

with

creating

new

demands

for

schools, churches, stores and

have

the

seen

development

This announcement is not an

atomic

The

Atomic

bomb.

are

matic

tubes

will

also

entering

where

auto¬

things

for us which we
imagine. Even auto¬
matic controls for heating and air
conditioning will be electronic and
cannot

now

there will be
room

fice

of the

thermostat in every

house, apartment, of¬

building and hospital.

Many

become

matic.

almost

which

may

will
next

certainly
10

years

mendous
every

continue

for

resulting

technological

Guided

will

ojjer oj securitiesJor sale

or a

rockets

replace

many

materials,

the

materials.

and

leader in the
our

years

come

recognized

New plastics

for new

country.

solicitation oj an ojjer to buy securities.

Columbus and Southern Ohio Electric Company

uses.

breakfast

eat

lunch

Man's

Los

York

New

and

First

health, comfort and effi¬
improved

been

mendously through
ment

tion

and

air

tre¬

improve¬

conditioning,

the

and

drafts

better

floors,

the

heating, cooling, ventila¬

elimination

Price 102.31%

cold

air
distribution,
methods, lower

better

costs,

less

plus accrued interest from November 1, 1953

installation

broader

maintenance

use

and

of automatic controls.

The Next Ten Years

now

with
of

the

going to

interesting

period

be a
time

economy.

Although I
have

General:

1963

billion

some

The

economist

ball,

predictions:

Gross

reach

based

upon

total

the

The First Boston Corporation

Hemphill, Noyes & Co,

Wood, Struthers & Co.

L. F. Rothschild & Co.

$460

value

Consumer expenditures will increase mother 50% for a total Of
Kjilirtn

Blyth & Co., Inc.

National

the dollar in 1951.

$320 billion.

The Ohio Company

Dillon, Read & Co. Inc.
not

crystal

Product will increase another 32%

Copies oj the prospectus may be obtained from such oj the undersigned
(who are the underwriters named in the prospectus) as may legally
ojjer these securities under applicable securities laws.

major progress in all phases

our

and

come

This

years.

most

Mortgage Bonds, 3%% Series due 1983

Angeles.

have

McDonald & Company

Riter & Co.

the

growth and progress

$10,000,000

Crossing the ocean by plane is
commonplace and you can now

the

into his

December 3, 1953

guided missiles.

sonar

new

condi¬

complete buildings will be

During

own

building

the engineer will really
tre¬

air

moon.

will

and

built of plastic

direction.

missiles

Plastics

war

advances

installation

tioned.

En¬

defense requirements. And

its

simplified and will cost

large percentage of all

and

air conditioning

and

automobiles

ing in all fields of endeavor at the
high rate established by

will
auto¬

much less.

metals

very

and

equipment

become

Research:

com¬

completely

will reach the

Engineering and

even

plants

Heating

and

extent

and

processes

manufacturing

gineering and research is continu¬

planes that fly faster than
the speed of sound.
The
broad
use
of
electronics,
Blind landings for aircraft.
Television.

very

electronics

Jet

radar and

providing for

world

New Issue

weapons.

electronic

other circumstances.

of:

long life.

demand.

buildings.

commonplace

eliminate

lower cost and

overwhelming. We must meet this

demand for many new

new

entering

are

will be

growth,
increased
social changes are
going to increase the demand for
your products and
your services

modern, air conditioned office
buildings in many cities is certain

The

better

automatic heating is today.

produce the

Population

The recent construction of new,

homes at

Research:

become

and lower in cost.
air
conditioning

will become

plete

right to expect.
earnings,

new

during the
And in addition the

growing demand with quality

results

highways. We need
super highways in ad¬
connecting roads and

rose

un¬

the industry have a

products

yet

in¬

and

will

1953.

mendous

highways.

to create

1963

This also applies to the
of

than

year

and

increase

sales

next 10 years.

rate

continue

condi¬

The air conditioning industry as
whole is expected to reach a

because

for

air

existing condition¬
ing systems will create a very
large demand for modernization.

popularity

year

com¬

units installed each

certainly

next 10 years.

to continue the

per

rate of

industrial

obsolescence of

present rate of spending at more
than

stop

less

commercial

buildings

functional,

available

present high

doubtedly

boom

non

Residential

years.

fly

world

and

will

years. The motel
boom has already

of the convenience and

tioning
more

hotels is certain to take place dur¬

mercial

parts of the

building

of
per

airplanes

hours.

1953.

will

the

dustrial

con¬

peak

com¬

conditioning
in world where the transmission of
homes is just getting a good start power and signals of all types will
and should rise to more than a eliminate wires and cables, tele¬
half million units
sold and
in¬ vision-telephones will be in com¬
mon
use, transistors will soon be
stalled in 1963.

unit starts.

200,000
must

million units

during the next 10

Central

increasing, is expected to

two

dur¬

will

years

increase

than

year

apart¬

ment house construction,

many

from an average rate going to make
billion at the beginning of

nearly three times as

lerl

265,000

rose

the war to $33

con¬

was

Planes
around

increase

submarines.

and

appearance,

tremendous

ships,

drive

power,

Homes,

air condition¬

room

will

energy

ing units which has experienced

from an office buildings in every city of
estimated 20,000 units in 1943 to the
country and the modernization
125,000 in 1953.
/ V
of existing office buildings which
The air conditioning industry as are worth
modernizing in the next
a
whole is expected to reach a 10 years.
retail sales volume of $2 billion
The construction of

And

The

♦

tioning

1953.

ings

air

estimated 50,000 units in

number

larger

in 1953 is at a rate which is
three times that of ten years ago.
The utilities spent less than $1

available

for

but

number

construc¬ ciency

tion

billion

units

1943

been

built in the past few years

tels,

central

conditioning units
from

1953.

you

records

homes ten
probably
less than 5,000. Sales in 1953 are
estimated at 70,000 units.

130,000 units

ing units started to

ago,

years

two-family

and

Individual

homes rose from 390,000

Very

are

ditioning

Annual

construction.

spending rose from $88 million to
$655 million in 1953.

30,000 units
an anticipated

ago

Atomic

such

sale of this
type of accommodation.

about

sale

the

quired

in ten years.
same
situation

The

way.

Engineering and

Construction:

money

from

years

hours.

watt

its

700,000 units in 1953.

the

increased

States

all

sale

services

and

products

room

creased

using statis¬
tics, but it ap¬
pears to be the only manner in
which comparisons cam be made.

1953

The

cooling

dislike

General:

used

tremendous.

the

widely

and

use

monly used to create electrical
•

total

accepted

the

and

the

badly.

during

The sale of

Hospital construction will reach

1953.

1963,

that within

peak of $1 billion per year dur¬
ing the next 10 years. We need
more hospitals and we need them

ress

years

a peak of $3 bil¬
during the next 10

year

in 1943 to 14,000,000

Panel heating was

will continue to

and

predict

will rise to about 25 million.

per

years.

automatic

units in

heating

from 4,600,000

units

lion

the

than two

number of automatic units in

average

1953.

And

heating units per year for

million

build¬

our

10 years:

particular

our

homes will rise to

deplorable

educational

Air

and

ings, will reach

units

war

sold

times.

vancements

And the prog¬

million

half

beginning of the

than

phases

many

about

million

unless

examine

w e

central

homes increased from

this country is
year

the

Heating

heating and air
conditioning, the sale of automatic

Individual
and
two
family
ventilating, and air
has expanded tre¬ homes will increase during the
next 10 years to more than 1,100,For example, the sale of auto¬ 000 starts in 1963 with a few ups
matic
central
heating units for and. downs on the way.

that

progress

and

living,

comfort improves

our

year,

every

field of automatic

conditioning
mendously.

do not

for

improve.

new

Conditioning;

matic heating,

have in store for
take a look at the

years

need

high rate for the next 10 years
by 1963.

of 800

hours.

construction, school construc¬
tion, because of the increase in

of last

progress

health, and

and increase at least 20%

Mr.

types

ent

Construction: Again in the field

Vice-President, Minneapolis-Honeywell Regulator Company

standard

construction is
expected to continue at its pres¬

electricity

usage

Our

all

mil¬

188

another

total annual

million

By JOHN E. HAINES*

will

total

people in the United States.

The

reach

Sweney Cartwright & Co.

The Commercial and Financial Chronicle

(2154

stock

mon

want

A Mutual Fund for

limit

New York Savings

current

Banks

Investors Mutual Fund, Inc.
President, Union Dime Savings Bank, New York City

facilitate New York State savings

others

organized and operated to

banks' investments in equi¬

lar

of the institution and its opera¬
tional procedures.
Says chief task of institution is to set up
"an approved list of stocks, which is subjected to continuous
check and review." Expresses confidence that the institution
"has

could

fundamental

four

whether

problems we
savings bank¬
faced

ways

in
in

mortgage

our

for
tor

except
except

agt

attractive

one

position we
as bond¬

opportunities

buying

within the

and

Wilbur Lewis

ortgage
lenders
when
m

sole

the

was

purpose

time

have declined
feel that a

will

prices

substantially

Whenever

and

for

well

facilitating

discounted,

will

reduce

our

purchases of defensive issues

and

of the relatively
which, while they
likely to decline more in reces-

dividual mutual savings banks are

are

quite well equipped to do their
own investing in senior securities,

sions> should do much better than
defensive equities when the busi-

not have the
contractual protection that is af-

Therefore, once a savings bank
has decided upon the amount of

forded

creditor-debtor re-

the

increased

Above

1 xh%

deemed

reduced,

give
a

the

ness

trend will turn upward again,

other words, the Fund gains
.

e....

U a!

fvr*

/"i

inirAPTmnnl-

1 v\

achieve

aJ d

saviLsbank

a *

market

such

under

variable

VallamC
^

attain,

sale

may

rate

be, the objectives of a higher
of return with a minimum

risk

which

savings banks

caused

authority

seek

purchase

stocks in the first place.

in the selection of
portfolio was the

The first step

for

our

growth of profits. Without

undue

the

year's low point

I. I. M.

nAtviwrtn

level,

Jirplrf
airecioib.

bank^* ~

Finally, and

over

importa t, b

stocks

represen

equity in entep

principal amount that the investor

^, c?t

^hpre1<5

Tn fart

ceil

Srupon ^ommJn sLck Victs
wuPn

the
me

rise

thav

dividends

of buyers
uuytus.

By
cj.>

token, there is no

common

in-

resDonse

enthusiasm
enmusidsrn

the.same
under

earnings

creases

stock

floor
when

urices

they decUne
response to unfavorable developments. Because
stock prices can rise so high, they
1
f
also can decline quite sharply.
No

forceful

Fund or directly, with

view to

be purchased immediately, or that

lessening the timing risk further, it need ever be purchased. But no
stock -will be purchased until it
can
tbe individual savings banks
(1) Dollar averaging purchases has been placed first upon the
be sure that an investment in the over a period of several years approved list because it has met
Fund is equivalent to an investwhich, we may be sure, will in- the exacting quality tests applied
ment in common stocks, with the elude
periods of higher and of by the analytical staff of our mmany added advantageg that uge
lower gtock prices> If the same vestment
adviser, the Savings
of the Fund provides.
number of dollars is invested Banks Trust Co., and because it
In view of the small proportion monthly, quarterly or, annually
been approved by the direc°f ^s assets that a savings bank over a period of years, we know tois of I. L M. r.
can at m(>st invest in common that the bank will buy more shares
The worth of common st c
stocks, our type of institution does when stock prices are low and will be determined ultimately by
futnrp
nt t
not face the problem of portfolio fewer shares when stoek prices '"tra\?^r"'ntg?.°£oast'oToresent
balance as it arises with an inves- are higher. As a result, the aver- poration, not by past or piesent
tor subject to fewer restrictions, age cost of the shares purchased, PerformThe^uyer of a stodc
°nl>'if the Fund is substantially

fully
most

reminder

invested

stocks

common

This can be done through:

—.1,

^ ^uSaSngs
noian8J a mutual savings
be 3% of assets.

can

matter

what

bank

marked is bound toit lowerhhan
"dlKei.
uuuuu iu ue lower man

issuing

ror-

savings

hank^dop^ahnut "mnSv 1nv«S-

tureeamings
?

«\0n\f\r!ino&

value is not 01 signmcance in ltvail during this whole period.
self to a going business concern.
V9CThe analysis of an equity issue is

the

average

that will

price

during that pe¬
the Dow-Jones

but

the

Fund's

The selection of individual
stocks

mon

for

by I. I.
bank for

F., or by a savings
matter, is a very

matter

from

the

primary

different

purchase

bond.

corporate

com¬

purchase

that

With

thing

the

bond,

assurance

that interest requirements will be
covered

the

adequate margin in

future.

four

It
does
not i matter
whether interest is covered

times,

six

times

eight

Whichever it is, the bond¬
knows he is going to get

holder
his

interest, and that there is a
margin of protection in earn¬
ings to assure regularity of pay¬

wide

ment

and

pany

the

ability of the
its

refund

debts

com¬

ma¬

turity.
With

common
stocks, on the
hand, it makes all the dif¬

other

in the

world whether the

earns

share,

share.

With earning

of $6 a share, other things
being equal, the stock is likely to
sell some 50% higher than if it is
earning $4 a share. When earnings
power

are

twice

share, it

may

high

a
as

when

share.

the

sell about
they are

As the residual

enterprise,

stockholder

earnings, and
drop from $8

the

all

the

the stock reflects

And when profits

share to $4

owner

common

entitled

these earnings.

share,

it is quite probable that the stock
may

lose

half

its

value

market, and that the

the

dividend

likely to be reduced in time.

ofa business? Asset

pre-

tank

Therefore,

mutual

parmnffs

—

14,

3% above that point.

are

company

if-anti

only

payable

are

Sept.

index has recovered to around the

times.

F.'s asset value per share

declined only 3%
riod.
Since then,

master list from which
selections are to be made.
This

■

Dow-Jones industrials
average de¬
clined by 8% between
May 15 and

preparation
by our investment
adviser, the Savings Banks Trust
a

significance

much

Co., of

experience, it is of some
interest to note that, whereas the

F. is to

purchase
nearly as

and

common

select common stocks for
to

selected

were

May

Selection—The Approved List
The chief task of I. I. M.

of the Fund in defensive

issues

ference

stocks

investment

our

effectuate

Others,
lower than average yield
a
bright promise of
increasing dividends in the future

brief

mon

offer

now,

due

manY
the adva tages of timing master list was approved first by
or
principal if payment is not
common stock pure ases through the Executive Committee and
forthcoming by a given date. We
jts selection methods, which favoi then by the directors of I. I. M. F.
.annottnreaen
o
^hnot threaten foreclosure.
defensive issues when prices are Inc., and the master list thereby
program adopted by the individual relatively high and yolatie issues beCame the
approved list This
assurance of a fixed and
savings banks would not be car- when they are restively low.
approved list now includes 184 inregular return on the investment ried out if the Fund should withAt the same time, individual dividual issues. I cannot em^

issues

high degree of assurance of
relatively stable, adequate divi¬

giving

equities, via I. I. M. F., the
bank can count upon these funds
being so invested without material
delay.
The overall
investment

We cannot sue for interest

iation.

giving

case

would find that it adds to its hold-

issues

dend income for the future.

resources.

reauired

The

no more than one-third
volative equities. The de¬

fensive

in-

275,

resources

stocks is to

common

types

When

policy of
having at least two-thirds of the

be, when the industrials aver-

issues

add

volatile

it wishes to place in com-

money

limited

prises, instead of holders of prior
claims as creditors.
This entails
an
unavoidable increase in risk,
Secondly, we do

vestment

will

amount

the

2%.

sound
investment
in
common
stocks by savings banks. The in-

in common

become residual owners

sources

prj[ce when economic conditions

recom¬

issues, and

225,

markpt

prosperous,

stocks. We
of enter-

invest

beiow 175,
Between 175
it wants 2V2% of reso invested,
and between

and

pres.
stocks are hieh

business recession has been pretty

established

common

consisted

adviser

age

period like the

become less favorable.

develop

recommended

common
li ?■
j
S"
-f
vynen common siocks are nign decline, and reduces its holdings
™mPanson w.tn the after a major ri
in the stoek
and business conditions are

stock

future.

near

common

tbe

which will guffer less of a decline

stocx

common

volatile

portfolio

30,

favor defengive equities; that is to say, those

time in
government

at any

short-term

^te

10%

defensive

regular¬

this

The

to 3% of assets, when
Dow-Jones industrials aver-

may

portfolio from

when

its

to time

combined, even if there
strong grounds for expecting

enjoy

holders

eautties^*
equities,

'more

o£

stocks

pxrlusivelv

maximum

and

are

senior

the

ansd

balanced

securities

relative safety

resources

cash

the

v e

common
common

keeping

First,

mHc

lenders.

acquire

«x>nd investors

and

proportions of

the

portfolio of stocks and bonds, or
to invest solely in common stocks
Our policy has been to invest

al¬

have

ers

^vestment fSn^is
investment tuna
is

rn
al
mutual

a
a

trad itional

is true.

contrary

policy is carried out
by the adviser.

The Fund seeks to minimize the age moves int0 a different zone,
risks. and maximize the benefits of down or up. Shares of I. I. M. F.
eqUlt^ investmtnt thr?uf\ vary" .could, then be purchased or re-

confronts

Thp first nijpstion that

mittee,

invested

fully

The

lems.

Portfolio Balance

respects

be used by a

Sept.

stocks?

approved by the Executive Com¬

it wants

the pund ignores the timing prob-

led to their adoption.

the

from

explanation of the reasons that

differ

portfolio

its

managing

example of how

bank may decide that

275

car-

mendations

savings bank to time purchase and
gaieg of COmmon stocks as a class,

reduced

sales,

and

formuia plan can

The investment adviser

ly makes portfolio policy

This is not to say, however, that The investment in equities is to be

tu9i

„.„nc

cite

225 ;and

would

intentions

timing

Let

Fund

the

ried out.

be sure

not

purchases

time

that their own

using

banks

savings

problems that confront Institutional Investors Mutual Fund

formula plan.

undertook to time its

purchases of common stocks with
a program
of its own, individual

assured and useful future."

averaging or

If the Fund

ties, outlines investment policies

The

ten-year program of dol-

Selection—Purchases and Sales

Once a portfolio has been accumulated, however, a sound i'ormula plan may be a good way to

com-

averaging program, and still

cost

of mutual investment fund

return

rate

higher

the

upon

other earning assets
realized year after year, to offset
the risk of depreciation.
Others
will want to use a five-year dollar

President, Institutional

Head

common

with

pared

LEWIS*

By Ji WILBUR

to the'legal
stocks immedi-

counting

ately,

Some will

purchases.

invest

Thursday, December 3, 1953

...

Hence, it is

to weigh

necessary

prospective

earnings
constantly
against present stock prices. This
is

particularly true of more vola¬
issues, on which the earnings

tile

factual'

nle

clinecl

statement

the

that

indi?shdal"average de-

Dow-Jones

almost 90% from the
peak of 1929 to the

bull

market
nidihci

low ooint ui
iuw
ijuiiii of

high"gl'ade b°ndS "ng ^

and m0ltgages'

market

hpar
«ecu

very heavily weighted, as it should in business is expected, and cut-

1932
i»u*.

3
The trouble with
!ml.ng Pr°gram. ls that it

rurcnases

Because

18 anticipated.

Timing of Stock Purchases
common

stocks

sub-

is dependent upon a savings bank's
ability to forecast the future, al-

probable fu¬
thereby

ap¬

praised.
The

Future

list is subjected

approved
,

to continuous check and review as
It was recognition of the special ject to such wide
price swings, ways an uncertain and hazardous new information becomes availproblems and risks attaching to the timing of purchases is particu- occupation.
The present Chair- able> to make sure that changes
•equity investment that caused the larly important to minimize risks man of the Council of Economic are made in it when new develLegislature
banks

authorize

invest

mutual

investment

savings

company

would facilitate their investing
«)mmon

cially
banks

stocks,

bucn

pJ0Y}des, an
designed

obtain

the

that
in

mutual

prob-

lems of risks that attach to savings
bank investing in common stocks

?^ T\/reSf °!
Investors Mutual

inn

una, inc.

I shall undertake today to spell

oqt these policies in detail, with
address

Investment

is,

Mr.

officers

5tate of New

despite the passage of a quarter
of a
century, inflation, and the

longed boom in its history.

lessemng the risks theieb>

Constant awareness ot the

maximize benefits.
Many
qpality equity has yet to return

to the peak prices reached in 1929,

Advisers, Dr. Arthur F. Burns, has
said that he is

prophet.

ness

nation's
the

very poor

When

foremost

business

Lewis

before

Association

the
the

York, New York City, Nov.

1953.

stock

cycle

purchases

one

busi-

authorities'

a§ency spe- fact that the country has been en- can appreciate the
sayings joying since 1940 the most pro- successfully timing
ottered

incurred.

help

benefits

pp*!?hp°Hckchprphv
•

and

are

says

that,

the
on

opments provide strong reasons for
doing so.
The

with
we

list

approved

provides

torg

bave

dec|ded

common

basis

same

industries, and should do

stocks

riod of

timing program it would
have to keep a large part of its
resources at times in bonds or

sfcokdTv ^ndiviHu^
.9ancUy' indlvidual
own

for

forecasting, counting instead
upon buying stocks as the market

declines and selling when it rises.

^T^T* 1

sayings banks
will want to adopt timing programs of their

(3) A formula plan under which

years

than the stock price

for their

averages

com-

provides

vestment adviser, are reviewed
and passed upon by the Executive
Committee of the Fund before

*7*™^ being Submitted to its board of

a better way to time purchases of common stocks while
accumulating an equity portfolio,

directors.
board,

approval

proposed

changes

list become effective.

cor¬

weigh

these
to

and

influ¬
decide

they make it desirable to
purchase individual issues on the
approved list for the Fund's port¬
or

when sales may be indi¬
particular cases.

The Best Solution

The

because they represent
stocks are bought as the Dow- both industries and companies that
class is preferably done
by indi- Jones industrials or some other have
substantially better than
vidual savings banks, rather than share
price index declines, and average prospects.
tke Fund. For one thing, if sold as the index rises. A formula
Deletions as well as additions to
the Fund were to undertake any plan modestly sidesteps the need the list, recommended by the inelaborate
common

when

will do substantially better than
issues of other companies in the

the

and

promptly,

cated

reason

our

difficulties of

ness.

that the timing of savings bank

discern
ences

to believe,

every

power

will be affected by a
variety of influences. Con¬
stant supervision is required to
wide

folio,

have

earning

poration

list of common stocks that,

After extended study, the direc- prophesying the future of busi- good deal better over a long pepurchases of

share are apt to fluctuate
violently with the swings of the
buusiness cycle or other factors.
per

,are weighed, and the
ture trend of profits

board

officers

of directors

and

the

F., Inc., have
labored long and hard to evolve
the best possible solution for the

exacting
stock

problems

common

investment for mutual

sav¬

ings banks.
We

feel

that

our

labors

have

borne
a
e

fruit, and that we now haye
set-up which assures for our

q u

i ty

investments

management
modest cost.

specialized

of a high order at
Our investment ad¬

the

viser has provided

the

and

a highly trained
specialized staff that closely
and
continuously supervises the

Volume 178

Number 5278

The Commercial and Financial Chronicle

..-.

approved list, makes portfolio pol¬

the

sales

and

recommended

Executive
these

policies.

Committee

all

upon

finally passed

are

Savings Bank Standpoint

and

recommendations,

actions

Our

passes

savings bank

maintain

this

ments.

specialized

kind

for

its

Executive

set-up

equity

only

all the funds invested in I. I. M. F.

savings bank.

majority of the savings banks
of the state, the cost per dollar
a

analytical

and

portfolio

savings bank could afford
at

own,

each bank based

4uHigher eai;nin,g
Ihe framework of

certainly

feel

confident, in the light of
experience to date, that I. I.

our

has

assured

the

grows

dollar

per

further.

services

come

build

the

our

working

are

exchange the

plan

stocks the.y

raise

money

the

Fund

If any of

conform

not

the

and

for
banks, I. I. M. F.

possesses

savings

which

conditions
of

banks

extremely demand¬

severely
the

adequacy

the

test

of management

resources

pressing and challenging prob¬
day in the operation
savings
banks.
Certainly it

would

that

seem

strength

vitality of the

and

all the

policy,

have

extent

the

wisdom

siderable

turned

in¬

necessary

mutual

ing

savings

unanimity §

this subject on the part

The concept

bankers.

investment is admittedly

contrary

the traditional and
habitual thinking of our business.
It

has seemed
to

ness

savings banks

dubious

who

some

sound¬

contend

that

institutions hold¬

ing what amount to demand deposits should not be permitted to

invest even on a limited basis in
equity securities with their ad'in- mitted exposure to risk, wide

some

notably

power—most

se¬

small

compared with sound debt securi¬

make a
to

market

fluctuations, and major
variation in income production as

savings

can

earn¬

net

Equity Investment Powers for

which

savings banks

Jersey
in

resembled

New

ment of

York
an

its

the

are

enact¬

equity statute bespeaks

an
9n

intensity of thinking and study
this subject commensurate with

its

significance

amounts to only

state in

author-

departure in

savings bank investment practice.
It is undoubtedly the product of
determined
efforts to solve the

fraction

Furthermore, it

capital funds.

.opinion that in those states

in New

counterpart

recent

mutual savings

The

investment

program

bank.

exclusive

objective of sav¬
equity securities
relatively
attractive
in

banks
be

yields from issues of high quality.
About V/* yea,'s ago when the
movement of the New York AssoNation to seek equity investment

Powers was inaugurated

unusu-

wide spreads prevailed betweei} yrelds of common stocks of
investment

quality and high grade
Referring to the contem¬
porary Moody's averages, the yield
bonds.

stocks

200

than

double

6.1-3%

This announcement is under
an

NEW

offer

buy

any

which

do not
now hold equity securities, but in
which there is no statutory pro¬
hibition against such investments,
future holdings, if any, are not
in

would

savings

banks

savings

likely to exceed
capital funds.

ference

332

basis

seems

These marked yield spreads were
tions in the capital markets which

indicated

shortage of high-grade

debt securities in relation to insti¬

tutional investment demand.

for

reasons

the

seem

banks

the

amount of

yield

spreads between com¬
stocks and bonds have dimin¬
result

ous

have

mous

securities
more

There has been

market

official

sec unties.

after

MILWAUKEE, Wis.—Harold H.

for reserves and
in any adjust¬
policy to meet

provision

taxes.

However,

ment of investment

with offices in the First Wis¬

the

consin National Bank Building, to

requirements

direction

should

there

in the securities business.
Emch
is
President
and

policy

oriented

was

debt

management

know,

has

direction

been

with

policy,

the

that

(Special

to The

Continued

ac-

sell or as a solicitation of
The offering is made only by the Prospectus.

Virginia Electric and Power Company
Common Stock

compromise
(#10 Par Value)

for

the

them

Price

diminution

per

spreads between yields of common
stocks and bonds during the last

Calif.—

The Prospectus may be obtained in any State
ment is
circulated from only such of the

while having reduced
George D. Ladas has become af¬ considerably the immediate rela¬
filiated with Dean Witter & Co., tive attractiveness of common
two

years,

dealers

Street, members stocks, has not removed the basis
and San Fran¬ for legitimate interest in these se¬
cisco Stock Exchanges.
curities by mutual savings banks
45

$27,125

Financial Chronicle)

FRANCISCO,

earned

substantial

The

Witter Adds to Staff
SAN

have

brokers

may

in which this announce¬

undersigned and other

lawfully offer these securities in such State.

Montgomery

of the

New

York

and

for

Keeler With Hill & Co.
(Special to The

Financial

other

which,

institutional

some

limited

per¬

Keeler has become associated with

west

who

Co., Carew Tower, mem¬

of the
has

New York

been

business for many

the

and

Clair

S. Hall

Mid¬

has

B. Cohle
&

Co.

re¬

American Securities Corporation

Incorporated

Eastman, Dillon & Co.

Equitable Securities Corporation

Indeed,

several years

investment

years,

cently been with H.
Co.

and

Allyn and Company

Clark, Dodge & Co.

the record of the last
has been one of sig¬
nificant progress in extending the
Stock Exchanges. Mr. Keeler,
scope
of institutional and trust
&

bers

A. C.

of assets, junior equity
securities
constitute
appropriate

centage

Chronicle)

Lynch, Pierce, Fenner 8C Beane

investors

CINCINNATI, Ohio—Robert B. holdings.
Hill

Merrill

Hallgarten & Co.
R. W.

*An
fore

address

the

Mr;

Investment

Middlebrook

Forum

the

Banks' Association of New
Newark, N. J., Nov. 18, 1953.

ings

be¬
Sav¬

Jersey,

Pressprich & Co.

A. M. Kidder & Co.

Salomon Bros. & Hutzler

opposite

obvious

558,946 Shares

priceless asset of widespread pub¬
lic confidence and good will.

the

effect

interest rates and the gen¬
yield
structure.
Yields of

firm; Joan¬ ment, safety, and liquidity that
have
signally characterized the
na
Kaczanowski
Vice-President
record of the savings banks, and
and
Secretary.
Both were for¬
kins. Co.

the

higher rates. Since
spring, however, the move¬
ment of official credit policy and

Treasurer of the new

merly officers of Brew Emch Jen¬

of
in

December 2, 1953

with the high standards of invest¬

at¬

enor¬

last

ISSUE

times

the

depressant, white

credit

government

long as

operated

debt

relatively

expansion in corporate debt,

itself
the

that

become

tractive.

eral

that

years or so
well known,

are

ished considerably with the obvi¬

upon

are

that

by adequate increments to surplus

Emch has formed Emch and Com¬

the
points.

points;

current spread is 221 basis

circumstances to be construed as an offer to

of these

satisfactory dividend rate
margin growth in deposits

was

the

composite cor¬
porate bond yield at 2.84%—a dif¬

mon

power

Savings Banks

If the sequence of events

for

During the last two
emphasize that in

preponderance of equity holdings
of all mutual savings banks, the

surplus account.

Jersey

ment

ties.

ized by statute to hold equities
does this power exceed the limit
of capital funds, and that in those
states which account for a large

New

as well as prudent management
and informed supervision, stocks
can provide a constructive ele-

as¬

vestment

Mr.

higher rate of return

sure

Own Investment Co.

re¬

equity

contribution

sagacity with which these
urgent matters are approached.

and

for

even

and

Harold Emch Forms

mutual

believe that equity securities in
and of themselves offer, in effect,
a specific for the pressing investment problems of the savings
banks. I do believe, however, that
subject to appropriate restrictions,
proper diversification and timing,

sav¬

specialization in a field whose
complex character and manifold
risks require specialization.

prudent

as they are frequently
substantial, arid occasionally of
controlling importance. I do not

continuing

the

ings banks as institutions of pub¬
lic service will depend to a con¬

engage

attitude

require

advantages of a very high degree

pany

investment

earnings after federal income tax
which measure the ability of a
hank, the undistributed net earninSs °*! which are taxable, to aug-

investment perform¬

are

limits

percentage of assets,

oper¬

lems of a new

savings

mutual

desirable

finding satisfactory solutions to

the

supervision

funds

proper

ran

ment the

produce

make

and

that

and

equities

combined to
with
the

have

investing

mutual

the

worthwhile

of de¬

will

I. I. M. F. for all
their common equity investments.
Devoted exclusively to investing
provided

Middlebrook

return sufficient to pay adequate

that

case

of necessity to
earning power

pressure

curities which
C.

ing. It may well be that the try¬
ing conditions of the visible future

the administra¬

secure

continuous

banks

management

ance

investment

institutional

augmented

vestment

liability

ating

policy of the Fund, they will be
In this way, the

tion

standards

sold immediately.
banks will

12%

Under

Circumstances have thrust upon

acquisition costs.

and

emphasizing the attrac¬
of

within

reserves

the

the stocks taken over do

resumption of
capital
market

course,

seek

additions to surplus.

the

strictions.

those

dividends

sub¬

ebb

subject, of

and

problem

charge of one-half

offset

that

tiveness of such securities for the

burden

scribe to shares of the I. I. M. F.,
and

There is

investment

minimum

posit

brokerage commission char g e s
which the savings bank would in¬
to

conditions

equivalent

followed

investment

surplus

contemplates eliminating both the

market

savings.

Federal

plan

if it sold stocks directly in

flow

assurance

incidence

are

market value for the Fund's shares

Such

the

savings

which

ple exchange of the savings bank's
stockholdings at current
value.

savings bank invest¬

madeinsuonortof6 limfted^duitv

such

and

common

asset

sepowerful

banks

The plan envisages a sim¬

net

have purchased directly for shares
of the Fund, where banks wish to
so.

the State of New Jersey,

However,

underrated

should

inent in

marginal position

ings

for

at times obtain

may

structure.

it should be duly emphasized that
marginal factors should not be

tribution

response

approach

than

asset

dent use, this new statutory power
should make a constructive con¬

in equity

powers

avenue

sav-

income taxa¬

savings banks to

common

overall

intensity of these forces will not

already

curities

invest-

outstanding American corenterprise, and increased
liquidity. Subject to pru¬

the

porate

the

tion

enable individual

cur

g s

p e n s e s,

possess.

prime objective of
bank
a

competi¬
tion,
higher
operating e x-

time,
should be¬

organization

foundation

strong

appropriately

sive

de¬

same

valuable

ests in

savings banks at

management.

in size, the

invested will

provided

even

within investment

P°wer

posits, inten¬

As the Fund

cline

most attractive to

are

Increasing de¬

useful

and

future.

cost

Reviews risks involved in stock investment, and

mutual

new

the

its participa¬

of I. I.

for

area

relatively generous yields on a
portion of assets, added diversification representing equity inter-

Describes organization and purpose of Institu¬
tional Investors Mutual Fund, Inc.

tion in the Fund.
The Future

investment program

the

bank

State of New Jersey

savings banks

savings banks.

its

cost

modest

very

the

savings

the securities markets through
which, under favorable conditions,

provide

can

clearly dis-

Discusses timing factor in stock purchases and prob¬
lem of stock valuation in
computing assets and reserves of

its investments than any

extension

opens

this time.

I. I. M. F. is thus able to do far

work

constructive element in

holds preferred stocks

invested becomes relatively small.
more

ment

timing, along with prudent management, stocks

based

the implications of trends in
capital and investment mar-

This

Vice-President, Institutional Investors Mutual Fund, Inc.

justifiable.
On the other
hand, by spreading the cost over

were

cernible within the last few years,

marginal position in their asset structure, savings bank
executive, however, contends, with proper diversification and

ments

assume,

kets which have been

Though asserting as long as savings banks are operated accord¬
ing to sound banking principles, equity securities will occupy

can

invest in equities would not make
the cost of any such organization
for its own common stock invest¬

the

permissive

invest¬

The limited amount it

the

Vice-President, East River Savings Bank, New York City

afford to

can

study, I

upon

By ALFRED C. MIDDLEBROOK*

the board of directors.

cording to sound banking principies, equity securities will ocdupy

and

out

carry

problem of relating equity investments to the special requirements
of savings banks.
Such thinking

Stock Investments Fiom the

icy recommendations, and suggests
purchases

(2155)

Laurence M. Marks & Co.

Wertheim 8C Co.

page

The Commercial and Financial Chronicle
12

Thursday, December 3, 1953

...

(2156)

ity of the monetary authorities to

We Should Have

keep interest

natural

the

were

By MEYER

working

rates.

Policy!

Flexible Monetary

But

capacity

curities,

KESTNBAUM*

with

serve

Chairman, Committee for

Economic Development

Marx, Chicago

President, Hart, Schaffner &

our

collapse, such

need

for

re¬

live in

for

point out to practical men

are

There is

and

strong determination

American

the

sectors

all

could

little

mination

economic

Our problem

oblems.

There are,

Without

attempting

some¬

prove

thing

that

obvious

seems

is one of means, and

wisdom in

the

opinion, avail¬
policies of gov¬

labor

business,

achieve

sumers,

means.

in the voluntary ac¬

ernment and

use

able means, in the

tion

deter¬

But

done.

itself is not enough.

essentially
■

and

con¬

that
Meyer Kestnbaum

the

one

im¬

most

chal¬

portant

lenges facing us today is the main¬
of

tenance

reasonable degree of

American econ¬
I need not labor the impor¬

stability
omy.

the

at Toronto

casion

wisely. It would be rash to assert
we are now prepared
to use
the
available
means
with
the
that

wisdom. We have
things, but there is

necessary

learned

many

still much to learn. What
learned

has

largely

come

shareholders

Imperial

Bank

such

low

the

79th

keeping interest

meet-

L. S.

dency
i

Presi¬

n s

of the
itution,

disc ussed,

topics

development
since
in

larger than the econ¬

demands
not

could

raise

could have held some

back—still

demands

al¬

lowing them to be satisfied up to
maximum of our productive

have

from

monetary
authority was used to keep in¬
terest rates down, there was little
opportunity to tighten credit to
the

power

private borrowers.
the

ceeded there

nition
of

inflation

postwar

increasing recog¬

was

this

that

pro¬

was

"our

that

has

not

present

world

golden opportunity to cut
remove exchange re¬
under the most favor¬

and

tariffs

strictions

circumstances,"

able
Mr.

continued

He complimented

Mackersy.

war

the United

and

important lead

Kingdom for giving an

movement

in the

trade by freeing one

to liberalize

until

convertible.

pressed the hope

the

emphasis

States

than

renew

but

has

given

investment

without waiting

controls

made fully

sterling can be

development
greater

been

Mr.

which

ex¬

that the United
decide

"quickly

would
the

Mackersy

leadership
given, since the

vigorous
has

she

to freeing world trade," and

war,

added that Canada, too, must con¬

tinue

trade

which

work for the freer world

vital to

her pros¬

capita output in

perity." "Should further tariff re¬
ductions be required of us as part

Noting that this rise in per cap¬

of a general
movement in that
direction," continued Mr. Mack¬

faster rise of per

Canada."

ita

production has been slow in
materializing, Mr. Mackersy said
"In the early postwar-years the
of

women

the

and

force

labor

the

from

reduction

monetary

experience and mistakes, and

"The

address.

dential

high level of prosperity offers the

policy—involving a the work week to peacetime pro¬
stability. We
sacrifice of the primary objective, portions retarded growth in the
is probably
how we shall
have lived, in less than 25 years, this
economic stability, to a secondary output of goods. In the last year
learn in the future. But we can¬
through a terrible depression and
objective,
stability
of
interest or so, however, there has been a
not
afford
to
make
very
many
a
serious
inflation.
During the
rates at low levels.
Considering sharp increase in production per
mistakes. We now face a real test
depression we saw the great pro¬
the complexity of the issues, pub¬ person and this is likely to be the
ductive capacity of the American of our ability to analyze our ex¬ lic
understanding of this grew
economy,
the marvel of history, perience and extract from it the surprisingly, especially when
lessons it holds for the future—
lying idle because we had not
rapid
inflation
resumed
after
too many mis¬
mastered the problem of keeping without making
Korea.
•
'
*•
that capacity continually engaged takes in the process.
.4
f
Finally,
in
March,
1951
the
'in satisfying the real wants of our
Treasury and the Federal Reserve
Recent Experience in Monetary
population. There was physical
agreed upon a change of policy.
Policy
With the offering today (Dec. 3)
suffering for some, frustration for
The new policy was embodiedPin
of
180,000
American
shares
of
many, and for still
more loss of
I should like to discuss today
the now-famous accord. The es¬
A. K. U.
confidence in themselves and in our recent
(Algemene
Kunstzijde
experience with one of
hard

economic

tance

prominent

industry after another from gov¬

general

only

withdrawals

perversion

restrictions was also a
feature of the Presi¬

exchange

kersey told the

Mackersy, M. C.

the

great

1953

by some 9 or 10%."
A
strong plea for further re¬
moval of international trade and

shareholders

L. S.

that

these

index

this, Mr. Mac-

easy

money,

the

raising

production

ernment

less

to get,
if we could have
restricted the public's supply of

factor

industrial

economies.

price?.
credit

made

have

Pleads

policy.

Regarding

market
If

the

upon

fail

main

than

greater

house building.

the

Canadian

could satisfy. The impact of

could

the
the

among

inventories, housing,
goods in general

much

these

the

only at the cost of per¬

equipment,

Mackersy, re¬
cently elected

automobiles and

omy

Canada

Annual

which
weighed
very
a large portion of our
population. The demands of busi¬
nesses
and consumers for plant,

were

Nov. 25, on the oc¬

relatively

Bank of
Can¬

says

emphasis has been placed

liberal U. S. trade

perfect capacity but at least reducing the productive capacity rather than
investment in house building, a
inflation. However, as long as the
factor which
has resulted
in a

not

stability but the essential goal of
stability. The means
to submit the reasonable
proposition are adequate, if we use them
like

should

address

the

inflation,

world

the

mitting and contributing to a vast

seller in world markets.

for

been

productive capacity rather than

that in
policy

however,

saw,

succeed

rates

large economy to achieve greater stabil¬
degree
the ity than we have achieved in the
problems of past. Without this determination

that to

development has

S., largely because

prac¬

was

power

circumstances

could

American economy as a buyer

troubled world. Nor is it necessary

this

also

heavily

There

loans,

so.

the

need be feared.

mind this group that we

in the process
capacity of the

recent

and

the

make

use

now a solid basis
occurred in 1929,

policy. Holds there is

and

economy

that of U.

Urges continued and accurate appraisal of eco¬
situation and its trends as prime factor in management

flexible monetary

for

ada's

primarily to
keep interest rates down it could
ing to

inflation.

nomic

se¬
re¬

tically limitless. And we saw that
if the Federal Reserve was will¬

of economic stability, CED Chairman
adaptable and flexible monetary policy that will aid in
controlling inflation without precipitating a depression. Scores
low interest rate basis of monetary policy, which, he says, leads
In stressing importance

urges an

government
newly-created

money,

Mackersy, M.C., President of the Imperial
Canada, at Ninth Annual Meeting of Shareholders,

Reserve's

buy

expand

banks

Development Analyzed

interest

raise

Federal

the

Canada's Economic

market

the

all

when

rates low

forces

Lazard Freres

Group

be recognized
the cost of find¬
ing
markets
abroad
for
the
greatly increased flow of exports
we
are
preparing to produce."
"they should

ersy,

and

accepted

supported

suggestions

recent

other

quarters that Ca¬
nadian businessmen should make
made

"more

vigorous efforts to sell Ca¬

nadian products

abroad."
T

Gol. & So. Ohio Elec.

Offer

the

recent

years

keep

have

lived with rapid inflation,
to

striving

personal, business and
on a raging

our

national affairs afloat
flood of

one

rising prices. Probably

better

than

aware

accountants

what

the

are

means

try to operate an economic system
\with

standard of value declining

instruments

must

economic

promote

stability

instrument

one

not

elevate

its true proportions
other

measures.

alone

cannot

But it

tion

make

can

that

with

cerned
rest
to

relations

our

world

the

have

con¬

come

recognize that economic stabil¬

ity here is not only important to
us

home. It

is also

essential

condition for the economic health
of the

non-Communist world and

thereby for its solidarity, security
and

freedom.
of

most

our

The

economies

friends

are

pre¬

cariously balanced. They cannot
effectively adapt themselves to
the
alternating withdrawal and

reappearance
♦An

address

Luncheon

gigantic

the

by Mr. Kestnbaum at the

the

Ame-^an

Institute

in¬

year

unusually

the

of
ac¬

field

monetary policy, and in the close¬
ly

field

ment.

debt

manage¬

worthwhile

con¬

sider this experience and see what
we

the

policy

with

voted to
the

small

one

yields

ties

low

some

the

war

monetary
and

from

years

end

Spring
was

1951

primarily,

exceptions,

de¬

purpose—to keeping
government

and

stable.

securi¬

There

were

beginning of the
period who thought that monetary
policy could not succeed in this
They doubted

the abil-

when

demands

cessive

and

demands
this

Canadian

Exchanges

the

when

intent,

Federal

Reserve

pursue

not

flexible

itself give

icy.

has

flexible
be

policy,
such

did
pol¬

policy

monetary

managed,

DIgby 4-3870
to:

regular commission

37 Wall Street, New York 5

Toronto

•

Montreal

•

a pros¬

arrangement

National

Bank

form

common

usual

the

resemble

created

the

stocks

was

to be

manage

policy is much
to

operate

managed.

flexible monetary

difficult than

policy of stabilizing

prices of government
In

the

latter

securi¬

case

Dutch

parent

A. K.

company,

U., and its affiliate together

constitute

of the world's lead¬

one

ing
rayon
producing
tions, having produced
the

world's

free

besides

output

organiza¬
over 12%

1952

rayon

producing

their

type of nylon fiber plus other
cellulose
derived
materials. The

own

price.

Spain, Italy and the United States.
In the Netherlands, the group's
centralized research organization
operates pilot plants and employs
about
850
persons.
Recent de¬

all

comers

The Federal

Reserve

rayon,

type of viscose tire

new

yarn,-and a nylon-type tire yarn,
while

and

continu¬

directed

towards

substantial

ing

originating and improving wholly

rates

monetary

necessary

first

manage a

policy
all

it
have

0/taw<v

TW X: NY 1-1467
•

Winnipeg

trends.

cide

the

is then
direction

ncessary

and

monetary influence that is
priate

the

economic

Continued

first

mort¬

Dillon,

Company.

priced

are

Co. Inc. and
The bonds

102.31% and ac¬
yield 3.50% to

interest

crued

Read

Ohio

The

The issue was awarded
competitive sale on Tuesday.

maturity.
at

Proceeds

from

the

sale

and

from

the

recent

bonds
of

managed

also
used

the

construction

its

ing

are

for
includ¬
bank loans

for

addi¬

improvements.

and

construction
riod

Dillon,

company

The

incurred

were

tions

Company,

program

payment

the

which

the
sale

issue o'f 200,000 common

new

shares,

from

for the pe¬
1953 to Dec.

program

Sept.

31, 1955, is estimated to cost about
$50,000,000.
The

bonds

new

under

are

redeemable

sinking fund which calls
retirements of $100,000

for annual

principal amount starting Nov. 1,
1958.
Sinking fund
redemption
prices range from 102.08% to the

amount.

principal
of

the

company

At the option
the bonds are

other

redeemable

than

for

the

at
prices scaling
from 105.81% to principal amount.
sinking
The

fund

company

service to

areas

supplies

City of Columbus and
Ohio

southern
estimated

electric

in and around the

with

area

aggregate

population of 850,000.

Woodard-Elwood Adds

With Robert E. Schweser
(Special

prospects

The

OMAHA,

appro¬

page

Co.

Electric

is synthetic fibers.

to de¬

degree

effect

issue

new

3%% bonds due 1983 is an¬
nounced today (Dec. 3) by an in¬
vestment
banking group headed

being

The

gage

dend distribution in dollars.

only velopments include equipment for
continuous
spinning
of
viscose

ready to buy government

Ohio

ern

Columbus & South¬

Read and The Ohio

the Federal Reserve

from

of $10,000,000

the

and

Bonds Offered

offering

United States and facilitates divi¬

group's manufacturing plants are
declaration of intent did not tell
located in the Netherlands, West¬
the Federal Reserve or the public
ern
Germany,
Great
Britain,
To

Public

Reserve will do. But to

Burns Bros. & Benton, inc.
U ires

Chase

corporation
Securities

publish

deposit

the

under

com¬

leading

effect makes the American shares

continuous and accurate appraisal
of the economic situation and its

Tel:

industrial

ex¬

deficient.

declaration

flexible
on

tended

with

first

the

knows what to do and the private
market knows what the Federal

INTERNAL

STOCKS
Executed

available the

pectus.

economy

stimulating

freed

to stand

MUNICIPAL

intensity of the

tended

securities

PROVINCIAL,

in which

situation, restraining the

—

CORPORATION—EXTERNAL and

Orders

and

flexible

one

—

adapted to the changing economic

fixed

GOVERNMENT,

inaugurate

policy

necessary for

Securities

declaration

Federal Reserve's action would be

ties.

-BONDS

stock

Act of 1933 and to

share,

per

there becomes
mon

$23.75

underwriting
syndicate
Lazard Freres & Co.,

headed

the direction

the

Canadian

monetary

how it

the

V.)

Flexible Monetary

amounted

which

the

Policy

But

learn from it.

can

purpose.

Chicago, 111.,

Accountants,

discussion

badly

create
a

used

view to promot¬

Unie

European
Adapting

of intent

and,

of the Fed¬

ing economic stability.

goal

that

was

would

Reserve

primarily with

This

dramatic events and
tive

eral

major contribu¬

certainly

can

accord

above

in relation to

stability. This has been
become

the

the future the powers

Monetary policy
provide
stability.

rate.

have

—

discussion

for

mean

used,

use

monetary policy. In selecting this

in significance at an unpredictable

sence

their society.

35 8%

Rayon Shares

van

208

has

been

Robert

added

Schweser

South Nineteenth

W.
the

Di¬
staff

Company,

Street.

The

Financial

MINNEAPOLIS,

Chronicle)

Financial

Neb.—Elmer

(Special

Minn.—James

E. Haverstock is with

Elwood &
bers

change.

•

Woodward-

Co., Rand Tower,

the

Chronicle)

Midwest

mem¬

Stock

Ex¬

Volume 178

Number 5278... The Commercial and Financial Chronicle

divert foreign

Our National Stake in

foreign

LEWIS W.

diplomat

vertible

recounts trade difficulties

currencies,

exchange

and

cal case in

other

policy
est ot

great many people.

become

highly

government

It has

ended

est

stretch

the

Pax

generated
heat

all the bitu-

the natural

of Texas,

It is not my

world

which

dence

familiar.

are

speak

about

problem with
be

make

ate

and

luce

the :foreign origin

not

may

should

Stake

estimate

our*

Ama^innnr

impeded

us suppose,

might
is

buy

has

Let

assume

that be-

nil

rton

nca/5

impoverished
exchange and unable

cur-

which

What is true of oil and cotton is

interference,

purchase

whole

petroleum

industry

America

concerned with the restoration

is, therefore,

what

true

rectlv

often

true.

cotton—because
cannot

used

American

cotton

visited upon

—

Take the

other
two

unpleasant

to
very

—

producer.

4-Ua

niun

m n

rlrr.1

foreign markets. A lower price
a
finer quality would not reduce the need of the foreign govin

iU „:

identified Place>
of

the

hardest

interferes with the volume
and the normal, natural flow Pf
Dmmerce.

commerce.

It
It is on these grounds that we
is on
all have the highest interest m
encouraging prudent steps toward
convertible currencies,

poc™Meihiiui<w

ftf

ttesponsiDiuucs wi u. •
•
This great country of ours has
grown powerful, it has become the
envy of the civilized world. In a
very real sense, more people en-

„

curtain

gteel

alloy

First, the export mar¬
product has been se-

price than his Indian, Egypor
other foreign competitor

.irV» rtfVlnr.

ranuirAC*

only so much of a commodity and

the American cotton

all, should he be able to grow
to sell it at a

tian

j:epnccinri

zeiJs

ad-

lower

dollars, then the ability of
France to buy all the oil its own
currency
could purchase on its

K. '

e. p0!nt 0

finer quality and

uses

be put

un-

yes,

purchases of his production,
it would avail him little, if

And

money

Anlt.

ited

his

the

restric-

1S that w^®n a Sovernme]nt <;>r,us
aSent restricts tne use 01 us uu-

ket

for

unon

can

non-

buy

verely contracted, for foreign currencies can be used only for lim-

non-sterling foreign marIt,
therefore, seeks other

imDOsed

have^'been then only in
nave
have
beer
been

consequences

the

exchange

produce is

currencies

which thev

non-

American

the

and

Dilarge

very

affected

convertible

currencies

freely
—

conseouences

verse

case

LverLv
tions

generating

heavy goods.

indirectly

world

equally true of a wide variety of
other goods.
Indeed, it may be
even

electrical

rataloeue of

oil

The

eauiDment and

convertible currencies.

many

rele-

vant'to

deeply

very

Teat

^ip of automobiles* it is

anct

principle applies to the production

this

true

0^er American commons

at least with less

established to supply the

eeSlv

restraint,

And,

markets which once were his.

case the oil that otherwise would
migrate to American markets. The

sterling

not all. If in France, for example,
there should be a limited amount
of sterling and a limited amount

the

markets and is attracted to North
American markets where dollars
are freely available.
But this is

times.

our

is' this

any currency
use
monies without interference

vitally important that

account

other

^ ers-almost
their
Vene-

fortunate

kets.

are now

ordinary
and accepted monetary phenomenon

firmly

convertibility

here at home.

quences

other

and

become

the other, new sources have been

con-

allows holders of other currencies

to exchange

dollar

penalized.

hand he is prevented from

one

selling his produce in the foreign
market, with far-reaching conse-

Venezuela cannot easily penetrate

investing in foreign lands. The inconvertible currency

stake

the

resident of the

sterling areas, the dollar oil from

Inconvertible

therefore, -doubly

independent
producer
has
an
eqally great stake and interest in

applies to residents in other

severely
constrained by limitations on the
use of most foreign currencies for
the purpose of buying goods of

calm, dispassion-

very

accurate

national

restricted,

has

since much the same sort of a
restriction on the use of sterling

....

who

supplies in

existing

area cannot be bought.
The American cotton grower is,

vertible currencies. The American

exchange
hypotheti-

the employment of his sterling for
this purpose. The dollar oil, accordingly, is not exported from
Venezuela to the Argentine and,

this

marked

Our economic activities

with

would

phase

which

familiar

too

peace since
Despite its

Currencies

re-ex-

which
many

Bui den

before

amine theeviDouglas

fields

buy a sufficient amount of foodstuffs and raw materials from foreign sources, the Bank of England
and the British Treasury prevent

infirmities and its economic

ine

been

made

incon-

become

foreign

that

have

Lewis

because

the producer of petroleum in foreign the

be preserved, lest the British

people

with

the long-

was

Romana.

„

the

area

long stretch of human experience,
with few exceptions, have now
become mere memories.

peat the argu-

for

commenced

studied

was

wars

currencies

purpose to re-

ments

cause

disparities, it stands out, in retrospect as the "golden age of modern
history."
Alas, convertible

Pennsylvania
gas

local

many

minous coal of

control

•

has

point

but

price. It the dollar

may be reflected in "allowables."
it is not alone the
American

ex-

and

supply is increased—not because
it is or is not of better quality,

-sterling-pesos-francs-guild-

zuelan oil.

the banks of the Marne.

Although
many

much

Take

toward
inflates

rencies—because

that

the battlefied of Waterloo and

subject and
as

two

the gold and dollar reserves held

controversial

one

production. It presses

influences

move

consumers.

wishes, let

foreign economic
absorbing the inter-

is now

This

markets.

American

Argentine,who, by one device or.
another, has acquired a Certain
amount of sterling.
It suits his

tion of national governments, as U. S. cannot bear burden alone
•

dollar

foreign "dollar oil" to

mar-

Fv5mni.c

vertible currencies
restrictions.

exclusion, and points out a prudent program toward more
freely convertible currencies can be had only by concerted ac¬
This country s

Turn

similar
devices. - Points out our economic activities are restricted, im¬
peded, and severely constrained by limitations on use of most
foreign currencies. Denounces "Protectionism" as a policy of

foreign

amples^of the exerted
influences
flow of trade

i i

arising from incon¬

controls,

goods produced in
from

May I refer to

DOUGLAS*

Chairman of Board, The Mutual Life Insurance Co. of N. Y.

Former

areas

kets into the American market.

Convertible Currencies
By

(2157)

IfiV

TYI CiCC.

flif thp

TT7 Jltprul

amenl—

convertible

There

are

would disagrt
tion that a
very

essence

organized

tern,

tiative, private enterprise and
-

nomic

freedom.

eco-

would* like to

djscuss this morning the significance of an
internationally -sound

almost every aspect'of
economic life.
V '
%'

currency to

American
There

was

period—it

ldnao^iod—when Ynthe

wa<?

flash Of

almost any money on earth
could
be
exchanged for almost
any other national currency.
In
an eye

Singapore
or

Sydney-^Gapetown
Cairo; in Rome, Italy, or Rome,
'

Mm...

r>'+

York—St.

New

o..„

Petersburg, Rus¬
St. Petersburg, Florida —

sia,

for

any

that best suited
each individual's taste a mark, a
dollar or a lira a franc, a ruble
or a
pound, a peseta, a tael or a
purpose

guilder

could

immediately

a!mmmvm5ma+5mm

_____

transferred into any denomination
of

rurrencv

anv

hank

anv

controls. and restrictions imposed

:~Z::TZr-.must De paia ior,:in umiars are
sequence of the exchange restncnrjennhnn<;p for onr rohnn

by and enforced with *the

tions' imposed

melled

this

ability

exchange

completely

trade.

part of

financial system
of
ot

markets

other that

and

commerce
com
erce

this free converti-

was

bility of currencies which was an

minister

indispensable

initiative

vidual

the

enterprise;
whieh

one

and

indl"

freedom

money

c^u

with
be

ex-

chunged for another and the liberty which an individual-enjoyed
to invest his capital, to grow or
manufacture and to sell his products in accordance only with the

the quality of his
inseparable partners

cheapness and
were

wares,

each

other.

The

period when

the international monetary system

reached

its

fullest

development

and when it was the least fettered

government

♦An

address

General Session of the 33rd
tng

the

Annual Meet-

of the American Petroleum

Chicago, ill., Nov. 12, 1953.

Institute,

someone^Se^sifng -faith that^gOvernment isajseryant

and not a. master From this fun-

other

areas

gr0wn

wherc

c^tton

can

tem of-tin

and

Continued

^ere » no ■barrier so impenetra"«•

barricade so insurmount-

able and

querable

restriction

uncon-

limitations

the

im¬
2his is neithef

posed by governments on the pur¬
poses
for which money can be
Let

are

general

Time

statements.

offer

sell

nor a

The offer is

interpolate at this point;
exceptions to almost all

there

solicitation of offers to buy any of these securities.

made only by the Prospectus.

180,000 American

does

permit an identification and

the validity of the

conclusions.

A. K. U.

make

ALGEMENE

general

this

which,

cases

analysis

not

may

A Netherlands Corporation

(United Rayon Manufacturing Corporation)

superficial

seem

KUNSTZIJDE UNIE N.V.

inter-

polation because I cannot discuss
to fall pre-

cisely into the general pattern,
Limitations

imposed

AMERICAN DEPOSITARY RECEIPTS FOR AMERICAN SHARES

the

upon

cu'rrencies

which

usfis

representing Ordinary Shares of Algemene Kunstzijde Unie N.
rate of 20 American Shares for each Ordinary Share of Hfl. 1,000

can

Put' whether lor investment or on
current account for the

V. at the
par

purchase

of
..

limitations

especiall

fonvertibilitv into other

rencies which

are

cur-

necesshrv to buv

commodities produced in a foreign

|andi

are

the'

Price $23.75 per

most inflexible, the

mQst

rjgjd and the most unbendof alJ of th
various jmpedi.-

mgn^s

eign

•

m0ditieS to

for

shrink

the

total

those
ties

comrelation to
,

wnat tney wouiu nave been—and

Prospectus

the

States

which

compliance

may

obtained

the undersigned

with

the

securities

may

from

the undersigned

December 3. 1953

legally offer these securi¬

laws of the

respective States.

Lazard Freres & Co.

for-

certain

Copies

with a proscribed and

use—cause

markets

American Share

trade>
,,

^ would seem than only those
w^° export have an economic interest in the restrictions on consumption and the impairments of
commerce which exchange controls produce. But this narrow
view does not reflect the extent
to which inconvertible currencies
limited

Douglas

dollars

sold for the foreign
currencies which they possess. The

intervention and —currencies
Mr.

ni;«KP«

impede.th<r movement of com- rencies to invest in increased pro™erce in internatlonal ; markets, ^u ^.on ofnon-dolter oilfor non-

international

r e e

and

monetary
ticmal
tional

them

made

that

one

currencies

convertible

identified

untram-

sm,nlv

matcfiai-good?-which-Americans
maperiai gyou? wiuui

'enjoy, the liberty which is theirs
are the products m. very .large
measure of our deep belief in the

upon

and

free

national money lor any

and

there 'is

Rut—because

the/restrjc- rencies which are wrapped up in
^ions to the flow of goods.-But controls, the greater is the dispothe various devices^ which sition of the holders of soft cur-

public office.

was

ima||

any

holder of
It

upon

a* commonplace among

hotef desk, without
offic?al°of a"*certral'banRor any the ®eneral P™PO««on. But the
L2^ J
iffiL
y exceptions do not cast any doubt
almost

farm*L

^the use of
of governments.
.
foreign currencies; and the greater
A great deal has been saidabout become the restrictions, the wider
the Various barriers to interna- the area in which they i
tional trade-tafiffs and quotas:are more numerous become me uux,power

value

Wjj

on page

The Commercial and Financial Chronicle

(2158)

will

take

less

perseverance,

problem
But

Corporation

Mr. Fairless reveals that U. S.
15 times that paid stockhold¬
investment.
Says only real solution to

employees receive in
return

their

idea

and

eliminate

unnecessary

strikes,

not

going

the

over

Dave

The

try to

during

gloss
the 20

that I have

fact

years

known

that

McDonald,

have

often

lound

our¬

selves

op¬

posite sides of

bitterly-

some

is¬

contested

could

hardly

issues
in

that

divide

much

that confronts all of
task

finding

industrial

That,

toaay: the

that leads

road

peace.

difficult

other¬

undertaking, and in the
minutes which

view

this

few

very

remain to

ties

diver¬

obli-

and

gations.

when

even

F. Fairless

Benjamin

But

have

with

him

when

thought

of action

course

most

have

that

his

dead wrong—

was

doubted for

never

that he

disagreed
vigorously-—and

moment

striving honestly and
to promote the welfare

was

sincerely

of the American people.

And

that

when

any

commit

commands

Dave

put

try—in his
he

best

own

could—to

lot of his fellow

dispute

tween
labor
of

the

there

quarrel

leaders

can

never

fundamental

regarding

goal which
We

and

be¬

leaders

responsible

real

any

but

course;

management,

the

method;

the

ultimate

seek.

working to build
better, stronger, happier Amer¬

ica;

but

seldom

our

get

time
we

opportunity to dis¬
we
really have

much
and

common

much

differences, that

how

cover

spend

discussing

agree upon

how

many

completely

and to

And

that

why

was

many pleasant and rewarding
hours with your President during

past

two

the

visitations that

weeks

in¬

program

plant

have long con¬

templated.
Both of us, I think,
have found these visits well worth

while, and our only regret is that
Philip
Murray cojuld not have
lived

of this

the

fulfillment

plan; for the friendly spirit
he
first
embraced
it,

which
16

some

right

organize

bargain collectively through

choosing.

free,

own

That

war

than 20 years ago, and

months ago,

with

was

-constantly throughout

our

journey.

to know that the

employees of U. S. Steel, for

ex¬

are now getting more than
times as much money as the

get out of the business.
on the basis of income

owners

ton

not

know

how

successful

are

going to be in the end,
because it will be many years per¬
haps before the fruits of this ef¬
fort can be fully
reckoned; but I
do

know

that

these visits
real

chance to

hair

far,
let

little, and

the
we

course

have had

down

get

back

our

know

each other better. In fact, I ralher
suspect that both of us may have
been a little surprised to discover

that we're
sonable
*A

a couple of
pretty
fellows after all.

talk

rea¬

by Mr. Fairless at a Dinner in
J. McDonald, President,
Workers of America, Pitts¬
burg b, Pa., Nov. 28, 1953.
honor

United

David

Steel

always

experience here I have never seen an account
of
Thanksgiving or of Memorial Day, the
4th of July or Christmas that didn't begin with
the sentence "Washington led the nation in
the observance of—etc.

Similarly, this stronghold of

Spotted shirts to spring up all over the
and • you would be amazed at the
men who followed him in display¬

grease

I think, that- the

means,

management to promote

the financial stability
itself is

ness

times

to the

employees

of the busi¬

Steel.

valuable

to the owners

that is

And

why

nothing which subtracts from the
financial

prise

security

enter¬

any

possibly add to the per¬
security oi' the workers in
that enterprise.
can

sonal

and

labor

chiefly
the

sents,
of

labor

interested

entire

members

it¬

repre¬

responsibility

primary
is

management

fam¬

concerns

the( comfort

with

individual

the

while

but

self

vitally

are

the welfare

ily,

management

both

ours,

Inaugural Ball with his formal

come

the

insure

in general usage.

flict

and

over,

that the

they

con¬

fight.
Now

union

representation

accepted part of

not

only
industrial

our

system-r-it is, I think, a very nec¬

especially in

enterprises;

firmly believe
representation were
disappear entirely, enlightened

that
to

and

larger

our

would

many
industries
welcome its re¬

quickly

partners
this

their

brought

bilities; and both

equally anx¬
achieve a higher standard
of living and a greatly increased
measure
of security.
But that is
are

problem which can never be
conquered by scrapping over the
a

family budget.
to

swer

that

there

nutshell.
must

The only real

is.

and

frankly that any
terruption, delay,

But

also

believe

that

unless

itation

which

workers

the

goods,

But that

think,

bacon

only be
recognize

can

Just

the

any

out

this endless

and

senseless

succes¬

seems

that

both

plex,

of
.

our

houses.

modern

our

put your

society

That

longer possible for labor and man¬
agement to slug it out in some
5,000 battles each year, without

terms

endangering

whole

our

national

this

the

quires

ahead.

task

cooperation—not

But it will

pay

Americans

allowing

quarrels

public
find

are

they will

patient people,
go on forever

to settle our
the expense

welfare.
a

not

better

They

private
of

the

Russia

do I believe that

long

leaders
here

know that both of

nor

want

find that better way. But we shall
never do so in an
atmosphere of

your

they believe they

unthinkable to

is
to

give

you

confidence in

one

another.

the

cause

State

our

Department that the Russians

never

may

that

some
day, in some way, the satellites will break away.
Conceivably, Russia might agree to some sort of deal involving
East Germany and Austria though our State Department experts

consider
be

can

this

even

is because

our

possible situation

meetings
there

are

the

some

initiative"

of the

this situation.

officials realize they are up

that

four

against an im-

they show annoyance over proposals for
governments.
Even in our own country

elements who

sincerely believe no harm and some

out of these meetings. But inasmuch
ratification of Russia's territorial gains is, in the view of

possible good might
as

It is difficult to see just how there

unlikely.

"seizing

any

our

come

officials, the only possible agreement that could develop,
the suggestion that such meetings be held is a source of
annoyance.
Such proposals, officials aver, tend to discourage
such unrest as has developed in East Germany.
Certainly, they
reason, if there is any possibility of the most powerful natfon in
the world agreeing to the present set-up in Eastern Europe, from
which it would follow that we would guarantee through
the

and

United

it, it would take

preserve

Chas. W. Scranton Adds
(Special

that

NEW

will

honor

Nations

The

Financial

most formidable

HAVEN, Conn.

209

Church

—

Herbert

Scranton &

Street,
Stock

Brew Jenkins

Co.,

members

McDonald

Day.

Company

Exchange.

Wis.

MILWAUKEE,
Jenkins
formed

Company,
with

Inc.

offices

—

Brew-

has

been

the

First

Wisconsin National Bank Building
to

engage

ness.

Formed in Milwaukee

Seeley has been added to the

staff of Chas.

Chronicle)

yoqr

industrial

discontent to attempt to overturn it.

51st

efforts

con¬

They would do this b.y

do so,

can

birthday, and I congratulate peace will be so fruitful in the
you on the great contribution you years to come that no auditorium
recrimination, suspicion and dis¬ have made, throughout your life¬ in the land will be big enough to
trust of each other's motives. We
time, to the dignity, the prestige hold all the friends who will want
can only do so in an
atmosphere and the advancement of Organized to join in paying tribute to you
of mutual respect,
understanding Labor. Above all I hope that your when next we celebrate a David
and

in Russia's holding onto them. It is something that
be able to do^anything about but we live in hopes

acquiesced

the New York

salute

is to

their satellites. And it is just as unthinkable
to the Department that either
Mr. Eisenhower or Mr. Dulles
could come back and face this country with any agreement that

re¬

tonight.

Dave,

easy.

attitude that they would

our

produce

guest of

that

French

even

the American labor

continues

British and

going along gnashing our teeth at each other."
It

conflict in the past.

movement

promptly.
I

task;
fail

and

intend

We cannot afford to fail in

expect

way—and

upon

isn't

gentleman's job

with

simply freezing the status quo, by saying to Russia: "OK, you've ;
got Eastern Europe. Let's stop where we are. There's no need

living for
American
labor
economy and doing serious injury
everywhere, if
to millions of
consumers, workers only we can learn to work to¬
and
investors
many
of whom gether with even one-half the en¬
were
only innocent bystanders in ergy, the intelligence and the de¬
the first place.
termination that we have wasted
but

the

forget about the cold war, they would like to get along with

conflict.

security

standard

tangible,

something

seizable initiative comes floating by.

if any

fronted

off handsomely in

increased

better

your

But

Cooperation—Not Conflict

com¬

"Seizing the initiative" is what Mr. Dulles is now being told
he must do as he readies up for his trip with Mr. Eisenhower to
Bermuda.
I have no doubt that he would be very glad to do

must strive

trying

For all the pundits seem to care, we are

"initiative"

that

can

strikes, the righteous wrath —^through
proper
incentives—to
of public opinion will some
day abolish such evils if we can.
descend, with crushing force, upon

seize the brass ring for a
left to believe
something upon which
hands; it is something readily seizable if you will
mind or energy to it.
and

merry-go-round

free ride.

earn¬

sion of

country that he must "seize the initiative." Nowhereexplanation of just what he should do to "seize
Insofar as I can learn it is like riding the horse

the

initiative."

the

output

ing the full rewards that they
-—and they ought—to receive.

giving Secretary of State Dulles

have I heard any

industry,

prevents those workers from

the pundits must be

now

sleepless nights by their insistent demands that he "seize
the initiative" in world diplomacy.
There is a resultant chorus

in¬
artificial lim¬

reduces

money.

many

unnecessary
or

improve our collective
bargaining methods and wipe out
can

their

early

activities.

an¬

bacon!

situation

our

get

produce

efficiently.

is:

one

organized bargaining in the plants.
Must

na¬

ious to

done,

Bargaining

enter¬

Immediately it comes to be.
word "integration" which the

the

was

out

their

respective responsi¬

vival in the interest of orderly and

Collective

their

make

joint

prise in accordance with the

union

management

both

contribution

ture

happen to think that la¬
bor's victory in that cause was a
fine
thing for America.
Today,
an

Thus

still

are

going around \vhh great, big chips
their shoulders—spoiling for a

Oh, the word or
that has not been

when they repeat it.

New Dealers
reign to explain about nine-tenths
They were always "integrating" something
and while you couldn't exactly see the "integrating" process you
came to learn that in the end it meant more government agencies
There

bacon.

know

mean

phrase will not really be new but it will be one

don't

seem

over

exactly what they

just put

itself, and to bring home the

with

all

Washington really

commentator or a bureaucrat will
a
new word or phrase that will
be worked to
the country, with few people giving thought to

A journalist,

me.

death

you

sur¬

Bargeron
.

the field of language,, though, that

It is in

fascinates

prising number of the combatants

decisively; but

Carlisle

evening

clothes.

hold

won

There was a rush

instead of in points.

Homburgs when Mr. Eisenhower wore one

this matrimonial partner¬

straight

folded

handkerchief

lapel

the

ing

across
on

Measured
effort

Bureaucrats

might be said to lead the way in many fash¬
ions.
Harry Truman's wearing of a bow tie
caused bow tie wearers with their attendant

—

the impression that the Nation's Capi¬
in the leadership. In my long

escape

tal

number of

inter¬

may

these days
if you read

Washington newspapers or the press dispatches from Washing¬
on the matter of the observance of national holidays you can t

country

Employees Get 15

of you

there

about
the

strength and security of the house¬

very

these

the

Improved

happy indeed to be able to spend

augurated

workers

representatives of their
ended

connection, it

some

establish

of the broad

basic problems of human relations.

In this
est

all-out

war

Steel

ship

American

BARGERON

heaf a lot of complaints from our pundits
being no leadership in Washington but

You

industrial

same

Times More Than Stockholders

with that understanding, let
begin with the fact that earlier
in this century, labor fought an

essary one,

both

are

each

enlightened

and

and
the

way,

improve

men.

We may differ as to
may

was

this earth in the first place

was
as

man

labor

why

views

substance.

deep personal conviction that the
reason

these

subject would be largely
matter of emphasis rather than

voluntary

real

so,

this

wholehearted respect and admira¬
tion; for it has always been my

only

doing

any way, even though I believe
that any disagreement between us

battles

man

cause,

you.

the

evening, I want to discuss it alone, this

with

or worse,

depends en¬
tirely upon the strength and se¬
curity of the household itself.

here

however,
gent nature of let me make it perfectly clear
that I am speaking only for my¬
our
separate
responsibili¬ self. and that I am not trying to
the

For better

ample,
is

course,

live

fare

overshadowing task

one,

always try to take some¬

household, and the individual wel¬

and to see
perspective,
I

better

think, the

interests

that therefore

and

state of economic matrimony.

us,

been

pose,

That

also

wise,

sup¬

had an opportu¬
nity to look beyond the immediate

have

sues.

have

utterly false

inseparably bound together

we are

Industrial Peace

Leads to

ever

can

economic

our

identical.

Overshadowing Task

that

if
the

in conflict

are

both factions."

upon

of the News

By CARLISLE

very

thing away from each other.
Actually, of course, our interests

collective bargaining methods
opinion will descend with

"public

crushing force
I

goods, more
interruption. Warns unless

think,

must

labor and management improve

Ahead

view.

Washington

intelligence,

accomplished

ourselves

are

can

rid

creating greater stability for workers is to insure strength and

efficiently and without

point

fellow's

and good will it is by no
an impossible task.

simply,

wages

security to the Corporation by producing

other

his
men

From

and a great
sides to try

future labor disputes,

settle
Steel
ers

means

United Steel Workers of America to amicably

upon

the

and

among

end¬

patience,

both

understand

reason,

Calling

infinite

willingness

By BENJAMIN F. FAIRLESS*

States Steel

3, 1955;

To create that respect, under¬
standing and confidence, of course,

Employees' Stake in
Stability of Steel Business
Chairman, United

Thursday, December

...

in the

Officers

securities

are

busi¬

Charles

of the Board;
Fred D. Jenkins, President and
Treasurer; and Richard F. Dooley,
Brew,

Chairman

Vice-President and Secretary. All
were

Brew

formerly
Emch

associated

Jenkins

Co.

with

Volume 178

Number 5278

The Commercial and. Financial Chronicle

...

(2159)

Why Transfer Management to
DONALD

tration

should

blobs

artistic

way

so?"

this

insure

the

intend

ask

But

"Why

don't

expect

to give me the answer.
I asked a soap manu¬

Years ago

movement

the

transfer

of business to poli¬

ticians and labor organizers? They
should recognize that this move¬

facturer

insanity

the advanced thinkers of

the

find

it.

I asked

Nobel prize-

Who
tent

great poetry.

could

make

than

ness

what

interna¬

well

tional

politician

rela¬

tions

trained, efficient
organizer?

pleases

sinful, according
to the morality of the hour, how

could

and

placates

t h

.country while

Richberg

produces

dissipate

the
of

vital

his

energies

ing

ambition

tell

-to

which

regarded

that in the future the
business management

managers

transfer

all

management to persons incapable
of
successful
business
manage¬
ment.

You

realize, of

that this

course,

transfer is already well under
way.
Politicians and labor organizers,
who

are now
taking over the job,
inherently incapable of suc¬
cessfully managing a business en¬

are

terprise.

This

weakness.
"their

This

not

training,

inborn

the

obligations

and

accordingly inevitable
that, after business-trained man¬
was

of business had made

agers

mendous

distributing
had

likely to

to be the more unsuccessful

prove

business

So let

managers.

of each class for incompetent

ties

management.
The
is

tre¬

first

object of

hold

office.

support him;
have

must

politician

control

accomplish

democracy

this

have

must

his

means

give
than

businessman

people than
before,

must

customers

they

pay

his creditors lend him money
which

the debts he

pay

with
owes

The

labor

organizer,

the

politician, has unbusinesslike ob¬
jects and methods. He will admit
er

the

ful

art

versal

same

moving

was

acceptance

tion, with

toward

uni¬

and

apprecia¬
enjoyment of ele-

mass

-vating literature, painting, sculp¬
ture and music, the so-called in¬

telligentsia

the

horrible,
and

vigorously
backward

movement

began

toward

ugly,

the

obscene

same

way,

ward

peace

universal will to substitute

cooperation and
istration

justice

rivalries and

the

vigorously
into

ward

tation
and

the
the

and

began

civilized

most

hateful

nations,

statesmen

so-called

world

for

bloody conflicts be¬

communities

tween

the

peaceful admin¬

horror

wars

and

back¬

devas¬

most
of

the

move

nations

biggest,

destructive

cruel

all

his¬

them,

should

agers

today

*An address

the

National

examples
business

not

realize

that

before

the

they

by Mr. Richberg at Dinner
Industrial

sponsored

Commerce

the

S.,

However,

labor organizer

openly,

business manager,

he raise

How

how

then de¬
himself for raising prices?

get

and

wages and

can

thus

then

answer

bow

ticians,

than any of his other bosses! Don't

not

know it? If

you

boss

who

insurance
I

good management?"

going to summarize
what management is ex¬

briefly

pected to do, what it must do, and
what

good management can do.

Then I

going to ask an easier
"Why should not good
business
managers fight
to the
death for their right to survive,
even
in a world going progres¬
am

sively insane?" Even
ple may be induced

self-preservation
subdue

peo¬

crazy

not to

may

de¬

eventually
that

hallucinations

the

ter leave him.

is the one
who has a dominant rea¬
have capital preserved and

property

person
to

son

owner

nially destroy themselves by kill¬
ing the

geese

that lay the golden

live by
jobs
which are provided
only where
there
is
capital on which they
can be employed. But they peren¬
nially seek to confiscate capital;
they

are-

plenty of

are

satisfied

fair compensation and

are

Now

that

the

end

answer
to
the
question I pro¬
pounded. Learned professors have

written

books which

Hundreds
have
of

passed

have read.

through

lawyer such

corporate

problems
the

office

I have

been

for nearly 50 years. In those years
I
have
served
cities, state and

national

unions,

governments, labor
wealthy individuals and

uncounted

corporations, including

of the

many

very

largest in

this

great industrial nation.

are

the

for

pretensions

|otlfier

any

special
listen

sophistries of

make

profit,

know, but as¬
sert, that he alone, when chosen
by intelligent property owners to
protect, preserve and make prop¬
erty fruitful, is a safe and com¬
petent manager of property; and
pensable
of

free

essential and

denounce

himself

out

vindicate his conduct at the same

his

when
are

labor

kicking

organizing

himself

that depend

people

free enterprise and the

private property.
The future manager of business
should be ready, prepared, willing
and able to fight for his right to
the power which he should swear1

himself he will not abuse.

has but

choice

one

He must be

prise in
will
in

slave of political rulers*
land
of tyranny.
In that

and within
destiny of America.

management,

Conclusions

the
Out

come

this

few

experience

deep-rooted

have

convic¬

Individual

(1)
most

freedom

precious possession of

the

hu¬

being.
(2) The protection of private
property, next to the protection
of life itself, is the greatest re¬
sponsibility and service of a good

man

government.

(Special

there must

protection

worker's freedom to

earn

liv¬

ing, of his security in accumu¬
lating the capital gains of labor,
and
of
the freedom of private
enterprises in which the capital
accumulated
by free labor can

prises
erty

are

those chosen

by prop¬

owners.

free

but the

which

maintaining

c o m p e

future

(Special

animate

South

to be bored

this occasion by any arguments

convince

you

the best

incompetent

business
either

have

consumer

way

managers

them

chosen

voters or by

If you don't
agree with me, I couldn't convert
you in one discourse; and if you
employee

voters.

The

Financial

Chronicle)

111. —Fred
with Reynolds

CHICAGO,
is

South

get efficient, continuous

serv¬

Kansas

Joins Bache & Co.

business

CHARLOTTE,

—

with
Co., Johnston Building.
M.

Avery

now

Item Two—He

good
will

provide

that his customers
justly treated,
optimistic.
Three—He must charge as
price as he can and give

will feel
and

Item
a

must support as

government as politicians

good

secure

and

service

tract—just
—

forward-looking

industries, that

have

com¬

piled a brochure to answer
questions, not only about
the

tract

itself, but also
City and the

about Kansas

Midwestern

area.

Wrile

Your Letterhead for Your

Copy!

possible, so

that, in competition for the

con¬

sumer's

dollar, he can sell as
many things to as many people
as
possible, because large gains
and secure profits only come from
a big
and growing business.
All

this

manager,

means

chosen

that

business

property

Jf-9,
C,Ty9
Southern
~Jln&L

D. T. McMAHON
Assistant to President

KANSAS CITY

SOUTHERN

LINES

Kansas City

5, Missouri

Turner

Bache

downtown

City, Mo.

portant to

ice.

from

miles

Ri-

Co.,

(special to the financial chronicle)

Manager

J.
&

Salle Street.

good

We consider this

wage

Co.

Reynolds & Co. Adds

business
the workers as
he can, in order

was

with Reynolds &
Eastman, Dillon & Co.

the employees

Good

—

Chronicle)

Street.

Salle

(Special

professional
the

Financial

previously

of America. The day of
exploiting manufacturers, para-

The

CHICAGO, 111.—Charles Jerne¬
has become associated with
I.
du Pont
&
Co., 205

great need of today in busi¬
is that the pride and courage
shall

gan

class

Francis

depends on
te n t, trust¬

managers

Chronicle)

Financial

111.—John

with

now

(Special

The

indispensable

The

Jernegan With du Pont

nation.

Eugene

L. LawAllyn &
Co., 122 South La Salle Street.
is

ver

bando

—

has

CHICAGO,

worthy managers in control of the
major industrial enterprises of the

ness

Ga.

Chronicle)

With A. C. Allyn & Co.

and

people

Financial

joined the staff of
Wyatt, Neal & Waggoner, First
National Bank Building.

(5) It is not only the future of
management

The

ATLANTA,

be invested and made useful.

(4) The only competent, trust¬

Northcutt

(3) To protect individual free¬
dom

lies

Joins Wyatt, Neal Co.

tions:

high

low

not going

are

for

One

enter-)

land of free men, or he!

ruler of free

He!

the futures

a prop¬

actually do?

security of

choice lies the future of business

manager must pay

the

teety?

get

Rules
Item

for

paying "low"
wages? Today he can accomplish
this feat by pretending that he is
not running the business. But to¬
morrow, if he openly takes over
the job of business management,
how can his management mouth

You

managers

indis¬

of the liberties

preserver

servient, and to charge consumers
too much so they will provide fat
profits for capital. But, at least
in modern times, what must good

and

silly

mild socialists.

even

He should not only

erty owner may be urged by fool-ish owners to keep

should

the

The manager chosen by

poli¬

spokesmen

interests.

patiently

that he is

looking for good managers.

Employees

onerous.

There

worthy managers of private enter¬

mankind.

capital

comparatively
satisfied, you have a fool
big boss and you had bet¬

easily

afflict the intellectual guides

now

have

you

isn't

for your

man¬

recogriize

should

name,

voluntary
public
servant, at least equal in his re¬
sponsibility and his pride to the
minister, the educator, the physi¬
cian, the lawyer and the engineer.
This
professional
should
not

good manager can satisfy his
capital boss so much more easily

shall

call

of business

the

by property owners the best

agers

But

mind

the question: "Why

selection

the

capital for his business,

profiting

man¬

Relations Con¬
the Chamber *of
and Chamber of
Commerce of Greater Philadelphia, Phil¬
adelphia, Pa., Nov. 19, 1953. Mr. Richberg
is
a
member
of
the
firm
of
Davies,
Richberg,
Tydings,
Beebe
and
Landa,
Attorneys at Law, Washington, D. C.
ference

the workers must buy.

feet

these

With

attempt to

you

state

himself

raise wages.

time

tory.

fears

business manager of today, worthy

But he must also poor so they will not demand too
denounce business managers for much, and to keep the government
raising the prices of things that poor so officials can be made sub¬
to

can

moving to¬

produce.

they

manding that management raise
prices if that is necessary in order

hope of human

was

such

fat

sitic middlemen and sharp trades¬
men
should
be
yesterday. The

loss.

humble silence.

not

all

reasonable

or a

nounce

beings for

verbosity

tfying to get more for the workers
than
they produce; always de¬

the

after

either meaningless

ought to admit that he is always

becomes

the

natural desire and

questions about what
a learned man can
answer;
but a childish "Why?"
will drive almost any savant into
happens which

willing to eat the seed
corn if a crop fails or if the labor
of harvesting enough corn is too

when

the discordant in art. '

*In

his work¬
constituents the full value of

everything
after beauti¬

way,

thousands of

eggs..

demand to

In the natural sciences there are

Otherwise

that he wants to get for

ferent managers.

unanswered.

still

and I un¬

get.

there would develop a widespread

replace them with dif¬

question

than the cost increased. Politicians live by taxa¬
he tion of capital. But they, inspired
by Providence with a happy in¬
goes bankrupt and, unlike a poli¬
tician, he can't pass a law making stinct of self-destruction, peren¬
something

what

goods

them

derstand

Contrariwise,

for.

favorite

his

This

customers

pay

successful

make

that

an¬

essential

business

his

run

they

got an

never

either stroy the men who feed and shelter
them. Some cunning instinct of

army.

voters

by favoring them

favorite

what

autocracy

the expense of others.
he

public

event he must please his

constituents

swer

did.

did

question:

them.

useful

enjoyed

ever

the

producing and

services to

and

success

disagreement
politicians or

labor organizers are

him

result

;self-interest.
It

may

whether

over

the

charge of all
enterprises?

point out the outstanding capaci¬
consum¬

will be demonstrated
by the abil¬

ity

There

practically forced

you

success

an¬

be obtained in

business

cur

his

genius, I

and

nation

own

generosity.
such a time, with

program

strengthening other nations
resent

effectively

than by establishing the
incompetent managers that

most

could

persistently offending its friends.
-He rises to heights of
grandeur

wealth

American

success

nulled
Donald

the

business

enemies of his

when

in busi¬

success

has become

ness

statesman is
o

busi¬

labor

Therefore, since

lofty

success

incompe¬

why

and

was

even

who

above

he loves

but he had been

answer,

Years ago

but

most

owner,

and

course

With

electricity

Incompetent Managers

profit,

and

wants

winning physicist to tell me what

acclaimed

capital

fool,

capitalists who

senseless

in¬

not

wise

triumphs, and
coherence

Finally,

things about his business but he
He had sought

time.

our

important,

did not know that.

unable

prevailing

why ' greasy

explain

greasy hands.
that he knew a lot

answered

for

the

cleaned

soap

with

only

Then

ment is harmonious and consistent

clay

hailed

are

the

you

do.

ent

bosses.

sumer

income.

management

and

that

sixty-four-dollar question:

in art—and

Meaningless daubs of paint
shapeless

know perfectly well that the

want.

should accept gracefully the pres¬

craft.

production and distribution of the
things human "beings need and

,,We are living in a time when
insanity is proclaimed to be genius
the apogee of states-

assume

efficient and constantly increasing

to what good managers

contrary,

intention

his employee bosses and his con¬

things security

his primary

serve

without serving well all his
other bosses—hiis political bosses,

by property owners has proved to

Adminis¬

following a path of "insanity"
already displayed in art, and that the transfer of business
management to politicians and labor organizers is already
under way. Says these interests are inherently incapable of
successfully managing an enterprise. Outlines his views of
good management, and gives advice

cannot

owner,

selection of business management

management is

says

waste

boss

the

wicked
you

One time director of "New Deal" National Recovery

why

me,

time?

Property Owners Best Managers

RICHBERG*

with

agree

your

Politicians and Labor Leaders?
By

The Commercial and Financial Chronicle...

(2160)

couple of sessions the issue
from

bounced

low for the year

THE MARKET... AND YOU

rather

brand

The stock market, contrary

Early this

into

year

Amendments to SEC Acts
Chairman of Senate Sub-Committee on

Securities, Insurance and Banking, holds informal conference
with SEC and representatives

similar act, more than

Senator Prescott Bush,

and added a
20%
in

substantial

value.

STREETE

By WALLACE

Confer

new

1953

Thursday, December 3,

it went

of securities industry, with view

making changes in Acts administered by SEC. Issues sub¬
ject to Regulation "A" likely to be increased to $500,000.

doubling in price, only to fall
wider moves of the division apart in a handful of sessions

Senator Prescott Bush
(R., ness of the law, those amendments
showed it hadn't but overall little was accom- that brought the officials into ConnJ, Chairman ofYhe^Subcom- upoVwhich there seemed to be
changed its mind in Novem- plished. In the face of this, the picture with pointed ques- mittee on Securities, Insurance and general agreement would keep
Banking of the Senate Banking intact the original intent of the
ber either. And the burst of the good strength in the rub- tions.
and

all

1ICMU1

uuon

iavv

«...

M1Ui3V

Acts—protecting the investor and

Currency

bers was a bit of a surprise,
Both Goodyear and Goodrich
were able to outperform the
general market the latter one
when, at best, of the early leaders of the

strength this week that
wound up the month carried
the principal components of
the market into plus territory
by fair margins
a

LJ1C

year,

standoff had been the most

expected of the month.
In

Committee,
A

second

American

been

into

opposition,

well

ran

as con-

points.^

Except for Du-

highs.

new

■

Pont,

these

the

among

are

its:
its wav a
way a

highs ot 192y.

fabulous

tempt to forge through workfurther into
bit further into

hit

resistance

the

than

the

gy coincidence, among the
and pushed the highs of the week were both
to levels not seen American Home Products and

since March.

Wrigley—two of
ful

The Blue

Chips Again

As has been the

case

pay

hand

Oils

Insurance and

were among

whilp

that

thpv

Currency.

monthly tured on the sick side, neverin addition to theless showed little in the
n

long, the major share of the an extra payment occasionwork was done by the blue
ahy. Wrigley has been somechips, which is fine for the what less highly regarded in
averages but of little solace to recent years and has gone its

Exchange Com¬
Chairman
Ralph ,H.

/; Securities and
mission:
r

Demmler, and Commissioners Paul
R.

the

Acts which

Rowen, Clarence H. Adams, Jr.,
Sinclair
Armstrong,
and A.

Jackson

Goodwin, Jr., also mem¬

th.e.EEC afj-

Sen. Prescott Bush

bers

senato^pointed

out that, based on
out »iuS uaocu

i American Stock Exchange: Edward T. McCorrrdck, President,

uvwuvux

experience with the Acts, a num-

staff.

the Commission

ber of groups an<* persons in and and Michael E. Mooney, General

Bmke^Assoct^

Arts

be amended so that they can oper-

ate

efficiently, effectively

and realistically.

0/Ew°

restudied

recommended,

proposals
and

heretoon
the

study submitted pro-

eral

Murray

The

Boles

Columbus,

Company,

Ghio

President*

Recently various industry groups
lore

fpa

Joseph P. McMurray, Staff, Senate
committee
on
Banking and

^ble°ri"meiid-

basis of this

the groups

wprpn't

Banking.

Hanson,

Ohio,
Gen-

H. Warren Wilson,
Union Securities Corporation, New
counsel;

York, Chairman of Federal Legislation Committee; Clarence Bickel,

P^ed amendments to the Com- Robert W. Baird & Co. Incorpomittee and tbe SEC for their rated, Milwaukee, Rn«tnnGeorge D.
Wis.; rnmnrawnnHc
First

that, while they weren t tea- consideration.
consideration.

their
men

Chair¬

Bush,

Subcommittee on Securities,

man,
'

the view of
to

Prescott

Senator

the
„

dustry with

ments

;

ference were:

confer¬

with

ence

have

basis

dividend

a mere

that

issues

stockholders

for

mal

33/4 point monthly improve
ment.

pre-

vious attempts

indices up

a s

sev-

tures. While the daily moves
have been far from spectacuiar> the stock was able to add
better than three points in
November," which was
far
from being the worst action
of the pivotals in the month,
didn't compare to the almost eight points added by
General Electric in the month
but was oniy nudged out by
the second best acting indusfviol
triaj iccna TJnPr»nt with a
jssuej DuPont with a

stituting the roadblock for the half of the Dow industrials
rally after the September that have yet to reach a priee
lows were posted. But this at- equivalent to or exceeding the
pH
ed

rfghts

on its show, the
again was at grips
DuPont, General Electric,
with the heavy overhead re- Eastman Kodak and Westingsistance in the280-285 area for house have been leaders this
the industrials.
This area is week, all of them forging to

rally

for

disclosure."

Those in attendance at the con¬

•

infor¬

putting

summer

Telephone

distinguished

eral weeks now for jts good ,SEC"and repone-day appre- streneth despite the weight of resentatives of
elation of well past a couple the
offering of deben_ groups. ta the

week with

market

where the

Strong Telephone

requiring full

Nov. 25 held

Woods, The First Boston Corpora

The meeting on Nov. 25 con- tion New York; Francis Kernan,
cerncd itself primarily with the white, Weld & Co., New York, and
so-called

Section

problem

TPrrold Brvre

Dodee &

Clark

of life despite the mar- lhe Securities Act of ,933. This L New York
'
kets action otherwise. A seetionisfrequentlyre£erredto
Exchange: Jesse
flareup m Texas Gulf Pro- as the heart of the Act. It author- Halsted counsel,
ducing or Pacific Western Oil
d0ne jnWthe dfsseminaUon
National Association of Investthe holders ot the secondary
way w^h little fanfare.
In now and then was the best of information and solicitation of ment Companies: Dorsey Richardissues. Nevertheless majority fact it is still
lagging by sev- the group could produce. To- offers, via the mails or any means son. Lehman Corporation, New
opinion is that if the "aver- erai'points from equalling the baccos continued soft, Liggett
Commftto; Ch" rfes^TatetTr!
age
stocks can succeed in 1946 high. Wrigley probably & Myers the leader on the comes effective.
Eaton & Howard, Incorporated,
breaching the resistance level, [s proof that the action held downward path.
The carpet
There was general agreement Boston, Chairman df Federal Legthe rest of the list will have
its

day at

the

time during

some

year-end rally.
*

Still of

paramount concern

the

laggard rails. While
pushed to
their good level, the rails have
yet to work their way back to
the August standing.
Moreover,
despite some signs of
were

the industrials have

been
Deen

stock

one

was

moderate

spIit

also

had

little

fol- that the law should be amendeo

nllw ™tt! perspotty
ner

somewnat

formance

many

of the stal-

items,

of the more
reaching a

the dissemination of more G. A. Saxton & Co., Inc., New
prospective in- York, Chairman, Board of Govervestor
in line with the original nors; Walter Cole, Beecroft, Cole
purpose
of the Act, without in & Co., Topeka, Kan., Chairman,

courage

Technical Bullishness Awaits

information to the

Governors; Wallace H. Fulton. Ex-

ecutive Director; John W. Lindsey,

Counsel: William Foshay, Counsel,
and E. R. Wardwell, .Counsel.

Specialties that did well in- market showed a tendency to nounced. •
;i. New York Stock Exchange:
Minneapolis Honey- expand on strength and conThere was general agreement Richard M. Crooks. Chairman,
weU Regulator, Carrier Corp., tract on weakness.
In addi- ^LnTof'TecurUies^xemnt f om ®°ar? o£ DGov7Ts;
^ei£h
cjuded

Seating Dlxte Cup, tion, the traditional ,ear-end

X^SSSSSS&St

re, neipea Dy. 11s year Anj,rtc.„ newly-listed ;Mon- rally could start at any time 000 was in order and would be and Samuel
and. tlie
dwidend,.and .Rock:
q-j
issue "that skip- with some evidence around '.unlikely to meet with any objec-r counsel. •
Island which came to life.this 4'.fov_i.cc e^ilic tion. The same protection to the ,
,

after

siesta for-

something

some

Board

Committee,

Legislative

end extra

week

J°seph E*

PMlfdelphla^Sof'Sfn"s-

in
a
a

stock makers

stock or lowing, Mohawk a bit more »
pay a st0ck dividend.
Wrig- determined on the easy side ing artificial distinction between trative Committee, and Charles
ley's last splitup was in 1923 and reaching a new low price circularizing information and so- Jackson, Jr., Counsel.
liciting offers.
The purpose of
and even in hectic 1929 the for the year.
liciting offers. The purpose of
National Association of Stolle,
Secusuch amendments would be to en- rities
Dealers, Inc.: Carl
market

Rails
comparatively unruffled price
of 93 against the better than
From
a
technical
stand- any way reducing the protection
82 of 1946 and its recent 78.
point, the omens were a bit presently afforded to the investor.
*
*
*
heavy on the optimistic side.
N°
was .reached on
i
1
1%
u.
f
.1
any details of the various Section
reawakening of inWell-Acting Specialties
tho earripr«
it ha?
77
°
"
Volume and Dreadtn OI tne 5 proposals discussed, it was an-

tentative
torpct

jn highest regard in the

way

Rosenberry,

With v First California-

time,

(Special- to The Financial* Chronicle)

.r
;

other end; ofnther^list;

ally,: but New Haven*

was

stilli

vu.

.th»s; : company;fi which- n
YV1",r1%"1

%l,° ^ [Tfte views expressed An this change.at this time, seem entirely
ts
■put*-AM
UHU iifUni.A.•;+** present7-firm is^probably^ the
artiele do not "necessarily ■ at. any -reasonable. .The SEC estimated
a
;
AI:.
1X> baby of the Big Board,-only time coincide with those of the that this would reduce the number
was constructive ithat^:the re^hree years old
It was first Chronicle. They are presented as °f issues which would have to be
registered by 5 or 6%.
cent pressure on it had dis
offered publicly last July and those of the author 0"ly•,
The
first
informal
conference
inclined

sae
sar

and
and1

NiCkeT
Nickel

appeared.

❖

■

The Dour Motors

The automotive issues have
shown little
the

face

been nudging into new high
improvement in ground with fair determina-

the

rather

dour

opinion of the industry's immediate

future

tion.

widely
Somewhat of a repeat pershared.
Chrysler has been formance was the unusual
able to participate in the seestrength in U. S. Hoffman
sawing to show some of the Machinery this week. In a
so

between

reached organized trading a
couple of weeks ago. After
a bit of hesitation, it since has

❖

Dean Witter Adds
(Special

to. The

Financial

and

Nammack

now

with

Dean

Bush,

securities

Suited in

Chronicle)

LOS ANGELES, Calif .—Howard
J.

Senator

the

industry

SEC
re-

general agreement On

meal and noncontroversial amend-

Joins Knowlton Staff
to

The

OAKLAND,

Financial

Calif.

Bush

—

John

Metcalfe, Jr. is with Frank Knowlton &

wish

emphasize," Senator

while these
various proposed: changes are in-

Chronicle)

(Special to The Financial

PASADENA, Calif.—Donald
McCombs has
Milton

the staff of

joined

Powell

Chronicle)

Security

Co.,

Building.

what turned out to be a few tech-

Witter & Co., 632 South Sprkig 1933 and Securities Exchange Act
t10othe E.ecu^ti^s ActA°!
Street.
1000
0
of 1934.

(Special

Joins Milton C. Powell

stated,

"that

tended to

lay and

reduce unnecessary decomplexity, and improve

Co., Bank of America Bldg. the administration and

effective-

Lawson, Levy Adds
Financial

Chronicle)

FRANCISCO,

Calif.

(Special

SAN

The

Daniel J. McGannev, Jr.
with

Lawson,

, Montgomery
•

ban
change.

is now

Williams,

Lew

street, members of
.

Francisco

Stock

„

Ex-

Volume 178

Number 5278... The Commercial and Financial Chronicle

(2161)

£§i|
iv';!vXwXy

The Seamen's Bank for
old U. S.

Assay Office

Savings purchased the historic site of the

at 30 Wall Street several months ago.

then the demolition of that fortress-like
the bank's Alain Office has been

turbance

the

Assay Office

Since

make way for

unavoidably noisy and

neighborhood. Next

Knox and West Point, the

structure to

a great

dis¬

the depositor^ at Fort
was one

of the

most

im¬

pregnable strongholds in the country—unbelievably difficult to de¬
molish. The bank

appreciates the patience of all who have endured

this turmoil in the interest of

Those who have
street

U. S.

will be

regard for the traditional beautv of this

pleased

know that the handsome

stone

great

facade of the

Assay Office will be retained in this building. Thus, the

completion of the
while

progress.

affording

new

Alain Office will

preserve a

opportunity for the bank

ient service.

famous landmark

give

more conven¬

THE

SEAMEN'S
FOR

BANK

SAVINGS

Member Federal

Deposit Insurance Corporation

The familiar face of the old U. S.

The

new

building at

Wall Street, twelve stories

high, will house the bank's Alain Office. It is de¬
signed to provide better banking facilities and
efficient service

the

public.

The first U. S.

Assay Office

Wall Street. This building,
erected in 1823 on the site of the
30

Verplanck Mansion,
ished in 1915

was

demol¬

and its historic fa¬

cade is now
part of the American
Wing of the Metropolitan Mu¬
seum

of Art.

Assay Office, shown here, is being
preserved as a landmark.

Committee
have

would

ment

Oi Capital
By PAUL

Issues?

available capital in

growing agitation among

Conservatives in favor of the ter¬
of the official control of

mination

public
made

pri¬

interests.

vate

two

occa¬

within

sions

week

the

House

upon

end the activit i

the

e s

Capital

body to which
all public issues in excess of £50,<000

have

established

was

for

Issues

The Capital

proval.
mittee

be submitted

ap¬

Com¬

some

years

before

the,war under the Chair¬
manship of Lord Kennet, who is
.still in charge.
It is not part of
the wartime system
of controls

main

far

abroad

nounced

expansion
the

air, there is

feeling in

quarters that it should
with

the

from

go, together

inherited

controls

war

many

from

Socialist

the

Government.

yielding

the

dictate

ers

Various

trol.

of decon¬

pace

lished at

controls

have, been

that

should

meeting

for

used

relative
ties

liberal

100%

possibili¬
allocation

the

In present-

capital ihvestment.

day Britain, however, no govern¬
ment could afford either economi¬

politically to pursue such

policy.

Should

removal

issues of little

some

control

investment

capital

over

or no

lead

obvious

utility
the
government
be exposed to attacks by

social

would

tal

enough capital is
made available for essential proj¬

erred

government

side

cautious

could have

ferred

over¬

instance

tea

safely been de-rationed
earlier—but

months

some

the

for

—

the

instances

some

aim

pre¬

comfortable

"safety margin."
As far
tal

issues

there

the

capi¬

concerned, however,
the

not

of its removal

any

over

likelihood

least

by this government

than there had been by
previous government.
Con¬

trols

only be removed as and
when supply catches up with de¬
can

mand

that it

essary

to ration the

Britain

postwar
capital

ceases

the

available

vestment is
meet the

for

to be

nec¬

supplies.
supply
private

This is

while

sibility
hibitive

their

capital accu¬
encouraged

isfy the need for such investments.
Should discrimination against in¬
vestment of little or no social jus-;
tifieation

cease,

reduction

tax

attempt

any

would

uncompromising hostil¬

ity on the part of large and influ¬

in¬

largely

result of 12 years of

invest¬

sections

ential

case

this

whether

matters

for

practical

is that it exists.
it

the

electorate.

of affairs is right or wrong.

state

for

the

immaterial

government

capital

issues

essential

it is

volume

politically

long

the

capital remains inade¬

only

screen

behind which successive Chancel¬

amounts of industrial or commer¬

fusals

escape

Exchequer take refuge

the unpopularity of re¬
the public is¬

authorize

they disapprove of. The Com¬
is a purely advisory body
policy is laid down by the
Welfare State tends to discourage
saving by owners of low incomes. Treasury. Indeed in case of im¬
portant issues the decision is sub¬
They no longer feel the same need mitted to
the Treasury before it
for putting away something for is
communicated
to the
parties
cial

investments.
any

case

the progress of the

rainy days or for old age, because

Com¬
will

Chairman;

Richard M. Barnes, A, M. Kidder
& Co.; George R.
Brown, Hodson
&

Co.,

Inc.;

Samuel

Cantor,

Cantor

Co.; Merritt Cole¬
Company;
John
Cusack, Amott, Baker & Co., Inc.;
Irving L. Feltman, Mitchell & Co.;
Allen

man,

Earl

Hooper, Gearhart & Otis,
Lester Frenkel, Gersten &

Inc.;
Frenkel;

Charles

Berwald

Kaiser,

Grady,

Knox

Wien

Co.

the

absence of the

capital and surplus of $32,-

total

Gersten announced

Mr.

that

the
the

expect

directors

maintain

dividend

cash

Department
of
of New York on Nov.

Banking

State

the

of $25 per share,
to $1,650,000, consisting of 66,000
shares of the same par value to

Fox,

admited

Stern, Frank,
is announced.

it
is

well

known

circles here and

Mr.

the

financial
East.

The

the

New
asso¬

American

Stock Exchange.
Mr.

Bennett

born

Los

Angeles, is a graduate of the Uni¬
versity of California, and attended
the Harvard Business School. Fol¬

lowing

three-year period in the

Navy, he became associated with
Founders

Insurance

assistant

to/

Company

Preston

1, John F. Fitzgerald was
appointed a Vice-President. For¬
merly

Mr Fitz¬

Officer,

Trust

is
associated
with
the
Trust Company's Estate Adminis¬
tration-Personal Trust
Division.
gerald

Other appointments at

the same

meeting were: Warren L. Murray,

Hotchkis,

He has been associated with the

firm for the past several years.

Officer; William M. Ewing,
Assistant Vice-President; Arthur
R.

J. Larkin,
Ogden K. Myers
Stevens, Assistant

Norman

Besemer,

John F. Lennon,

John

and

The

Hurley

Financial

COLUMBUS,
now

fills in the economy of metro¬

politan Chicago and its suburbs."
if

the

increase

000

effected

was

the

sale

new

common

$700,20 by

Nov.

stock.

Staff
Chronicle)

Ohio—A.

York, following a meeting of the
of

Board
Dec.

held on

Directors, also

announced that Anthony
Vice-President of

G. Quaremba, a

Bank
was

Farmers Trust Com¬
also appointed a Vice-

President

Nov. 24 that, as a result of the

election

Vice-

County

Trust

White Plains,

Company

today

completed 25 years of service.
with

started

bank

the

The

State

The

Bank

them

Ilammondsport,

under date

certified
a

filed

of Nov.

copy

has

Order,

Special Term of the
held in and for
Steuben at the

Supreme Court
the
County of

Court House in the

ing,
The

Jan.

Bank

12,

City of Corn¬

declaring

1953,

of Hammondsport

dis¬

solved and its corporate existence

terminated.
si:

s':

Lovington,

Connecticut Savings Bank

the

New

cent

Haven,

opening

Conn,

its

The

date.

re¬

new

Avenue, West Haven and its man¬
ager is Carleton B. Smith, Assist¬
ant

Secretary.

Peyton

affiliated

with

Bache & Co., 5 West Broad Street.

❖

Huntington
Bank,

Huntington,

effective

stock

capital

Bank,

increased its

Mex.

$50,000 of the increase was made

dividend and

stock

$50,000

by sale of new stock.
*

The

Bank

Calif.

Encino,

its doors for business

opened

Nov. 23.

Bank

Encino

operated

owned

Fernando

San

Valley residents. It is the only in¬

dependent
valley

bank

A veteran staff of

headed
dent

western

and

10 employees

Executive Vice-Presi¬

will

fro

the

area.

Manager Harry A. Renthe Bank of En¬

oversee

Other bank per¬
Schatz, As-

operations.
include

Carl

Vice-President

and

Cashier; F. Clayton Wilson, Betty
Jean
A.

Stewart, Ruth E. Davis, Carol

Patricia

Putnam,

Brien,

Earl

Violet A. Poulson.

Steil and

thousand

value of $50

The par

value

per

with

sold at $80.

were

share,

$150,-

000, served as capital.
The re¬
maining $90,000 is surplus.
The bank will be a member of
the

Reserve

Federal

the

Federal

System

Deposit

and

Insurance

Corporation.
^

Nelson

dent

and

Bank

Francisco,
30 after

ice

Trust

The

San
Nov.

retirement

accordance

compulsory

program.

sett,

A.,

than 32 years serv¬

bank.

bank's

ment

Calif., retired

effected

the

Officer

California,

the

Hackett, Vice-Presi¬

Ralph

with

retire¬

Whit-

Jr.,
Vice-President
Officer, will assume

and
Mr.

Hackett's duties.
Mr.

The

Hackett joined the staff of

Bank

1921,

was

California

June

20,

elected Assistant Trust

Officer April 11, 1922 and became

Trust

16 from $100,000 to $200,000.

Nov.

was

si:

Approximately 2,600 people en¬
tered the new West Haven Branch
of

National

Lovington

common

par

Banking Department of the
New York reports that

Hammondsportj

Three
*

The

with

beginning Jan.

three-year term

mes¬

senger.
*

1, 1954.

Rindlaub,

Mr.-W.

closed,

just

Beall, has been re-elected a Class
B Director of the bank, each for

sonnel

The

Chairman of

of Dallas, Texas, announced

Bank

cino

Bank.
*

Parten,

the Board of the Federal Reserve

and

City Bank of New

The National

Mr.

The

Officers.

Trust

Branch is located at 612 Campbell

(Special

role the bank

the important

scores
now

Trust

President.

Bache Adds

the

expresses

nature of our business and under¬

Dec.

granted at

was

held

Yrork

New

Company,

Trust
on

&
Ben¬

and

Exchange
of

in
the

has been re-elected a
Class A Director, and Mr. W. F.

meeting of the Board of
Directors of City Bank Farmers
At

Meyer

in the

member

accurately

sistant

general partner of the investment

nett

said

move,

chosen because it

was

name

new

"more

President,

Stout,

the

Peterson,

Trust Company of New York.

Stern, Frank, Meyer
been

and

Bank

State

Commercial

the

City

LOS ANGELES, Calif.—Norman

Harold

announcing

approved a certificate of In¬
of Capital Stock from $1,-

Andrew

firm

its

Commercial

First

The

Rogers

changed

111.

Chicago,

bia, S. C. from $600,000 to
The

Bennett Partner in

has

the Bank

Dec.

capital stock of The First National
Bank of South Carolina of Colum¬

capitalization.
if

Bank, Chicago, 111.

$2 annual
the increased

President of the

Bennett

regular

also

pany,

mittee

concerned.

the stock

payment

and such transfers,

500,000.

Co., Inc.; Roy R. Lar¬

Co., Inc.;
Harry MacCallum, Jr., MacCallum & Co.; John J. O'Kane,
Jr.,
John J. O'Kane, Jr., & Co.; Hor¬
ace
I. Poole, Eisele & King, Libaire, Stout & Co.; Stanley L.
Roggenburg, Roggenburg & Co.;
George A. Searight, George A.
Searight; Herbert Singer, Singer,
Beane & Mackie, Inc.; Louis P.
Singer, Troster, Singer & Co.;
Elbridge H.
Smith,
Stryker
&
Brown; Robert Topol, Greene &
Company; Melville S. Wien, M.
son,

sues

and its

un¬

of the par value

mittee

member

any

from

amount

stock.

new

250,000, consisting of 50,000 shares

Collins,

ciate

made

profits to surplus, result¬

after

Co.,

following members:

Stock

group.

Issues Committee is

lors of the

George

York

has become materially re¬ quate to reserve it as far as pos¬
duced, for it is primarily owners sible for productive purposes, from
of large- and medium-sized
in¬ the point of view of furthering
comes who save and invest.
Low the general economic interests of
income groups can only save a the country.
As a matter of fact the Capital
very
small percentage of their

posits or Savings Certificates in
preference to acquiring small

consist of the

by the

to $500,000

$400,000

sale

in¬

capital stock

common

crease

The
George L. Collins

impossible
suppress

the

President.

firm

pur¬

15%

Incorporated,

Because it

ment

earnings. What they save is usu¬
ally invested in Savings Bank de¬

divided

will

capital

additional

and

Amott, Amott,

encoun¬

tered

being able to sat¬

high taxation the amount of

saving available for

that

should

for the sake of

Govern¬

new

of social
be possible to con¬

interests

Socialist

very

ma¬

electorate

mulation

after the

may

the

and which was increased

ment.

weaken

would

pro¬

So long as capital issues

vince

What

the

present

confined to purposes

are

exists

under

pos¬

the taxation

from its

level

terially.

poses

war

political

reducing

of
rich

the

the war

developed during

not

Moreover, the

ects.

unessential proj¬

resources

ects

equalitarian trend

the result of the
which

capi¬

it allows the waste of scarce

far from sufficient to

demand.

that

opponents on the ground

utility it

the control

profits

Baker

safe to allow

earning

profit

determine

regime

Harry

the

safely, without the risk of having
to reimpose prematurely removed
controls.

Jan.

Friday,

It is true

imperative needs.

most

conclusion that this could be done

the

Ho¬

(Grand
Ballroom) on

the control was to
the capital available

its

but

t t h e

from

amount from undivided

necessary

Asso¬

its

Marian, Ind.,

Bank

tional

creased

Transfer

dividend.

stock

payment

Effective Nov. 20 the First Na¬

name

tel

object of

ensure

subject to the

Comptroller

the

1954,

19,

ing,

Biltmore

scarcity of capital resources was
not nearly as acute as it is today.
The

25c extra dividend

dividend

held

Park,

ciation

System effective

16.
*

quarterly

4, 1954 to stock¬
record Dec.
18, 1953

Dealers

time when the relative

both payable Jan.

Security

and

only as and when
government arrived
at the

removed,

dividend and

pressure.

Throughout its two years in office
it never allowed its own support¬

the regular 50c

Nov.

Governors

Reserve

Federal

Di¬

Nov.

had

cally

The government shows no signs

York

New

announced

under

the

28th

the

22,'- 1954,

would be considered

Nevertheless,
spirit of freedom is in

Chairman

estab¬

was

voted

rectors

declare

an¬

York,

Board

membership by
of the

Board

Jan.

clearly absurd to remove the
existing Control over capital in¬
That control

the

that

nounced

admitted

been
the

Currency and of stockholders
at the annual meeting to be held

Collins of Geyer &
has
been
appointed
of the Committee for
Annual Dinner of the

Inc.,

new

which prolonged its existence into
the

Trust Company of New

approval

George

vestment.

National Bank and

the

28th Annual Dinner
Co.,

President

Gersten,

Public

holders

Security Dealers

firms.
circumstances it would

establishment
In

N. Y.

de¬

firms

existing

economically
the

inade¬

handicap

grave

politically

dispense altogether with
of capital issues.

control

now

been

has

investment

such

ford

available for

of the funds

quacy

The

sufficient.

from

the postwar period.
since

arguments

home

take many years
government could af¬

may

Chester

of The

and also had voted,

willing to take risks ei¬

and

it
the

generally recog¬
nized that the number of investors

Issues

Committee,

Or. Raul

result

available
for industrial and commercial in¬

ther

Commons

expected

the formation of savings

vestment.

for

things

the
is that it prevents

level,

present

able

called

the worse from the
point of view of the private inter¬
ests concerned.
By the look of
change

against continued taxation at

was

them.

Bankers

and

ETC.

CAPITALIZATIONS

remarkable

departmental committee of gov¬
officials would
be a

before

the

BRANCHES

OFFICERS,

ernment

are inclined to live rignt
the limit of their income.

the Exchequer

Chancellor

after

NEW
NEW

efficiency and its replacement by

Britain.

look

One

CONSOLIDATIONS

businessmen
with the
tape. It has per¬

practical

REVISED

they

issues

securities

After all, the Committee
of

formed its duties with

factor in cutting

the Welfare State is now

News About Banks

with the existing

compared

minimum of red

savings of large- and medium-sized incomes as

lately

improve¬

who carry out their task

EINZIG

the decisions

not

consists

growing agitation among Conserv¬
ative Party to terminate official control of the public issue of
securities by private interests, foresees little likelihood of this
action being taken, owing largely to insufficiency of capital
available to meet the demand. Points out substantially reduced

LONDON, Eng.—There has been

itself

Treasury
take

system.

Dr. Einzig, commenting on

down

the

would

which

Will Britain Remove Control

December 3, 1953

The Commercial and Financial Chronicle... Thursday,

(2162)

Savings
Va. has

Trust

Officer

advancement

April 2,
to

1940.

The

his present posi-

Volume 178

lion

Vice-President

Officer
He.
Vice

Number 5278

has

the

held

Trust

and

made Jan.

was

The Commercial and Financial Chronicle

...

11, 1944.

positions

Trust Division,
Bankers
Association,

President,

American
and

.Chairman,
Trust
Division,
California Bankers Association.
Mr.

staff

Whitsett,
of

The

joined

who

Bank

the

California,

serving
bank

Vice

Assistant

1936

prior to

Officer

and
that

The

joining The Bank

pany,
on

than

500

Div. for Dean Witter
Announcement

under

which

covered

improved plan

the

may

benefits

employees

permitted

twice the
maximum

coverage

annual salary up
of $10,000, with

participating

banks

1951

and

1952 have reduced the net cost in
those
per

to less than 65

years

cents

$1,000.

The Correspondent Bank Group
Life Insurance Plan, under which
Manufacturers
acts

Trust

trustee,

Nov.,. 1947,

was

for

making

group

available

the

Company
started in

life

tion in the plan.
When
the
necessary

have

been

obtained

participating
turers Trust

consents

banks,

Manufac¬

Company will declare

the improved plan effective.

which

Walston Co. to Admit
directly be¬
SAN FRANCISCO, Calif. —
cause. of
lack of the
required
Details of the new plan are set minimum number of employees. Walston &
Co., 265 Montgomery
forth in a letter to participating Banks participating in the plan
Street, members of the New York
banks which points out that there obtain
group life
insurance for,
and
San
Francisco
Stock
Ex-;
will be no change in the gross their employees on virtually the
premium for the ensuing policy same basis as do the large metro¬ changes, admitted James E. White
reducing

benefits

age

and

could

not

obtain

over.

year.

This premium is now $1
for

month

but

ance,

each

$1,000

insur¬

received by

dividends

politan
risk

banks,

over

large

spreading
number

the

in¬

surable lives. While primarily de¬

partnership

Norman
the

firm

J.
on

Duval

December

withdrew

November

30.

the

Division

Witter

Dean

former
Hall

Co.,
the

located

Harris,

quarters
West

111

Monroe

Street,

The
appointment

Chicago.

the

follows

recently

announced

merger

Harris, Hall &
Company with
Dean Witter &

Co., which has
Lore

Alford

been

approved

Harris,

by the

Hall stockholders. Mr. Alford

Vice-President

firm

Hall

charge

the

was

Harris,

of the

Sales

Department.
Edward

former Presi¬

Hall,

dent of Harris, Hall, will

become
special partner of Dean Witter

Co.

Mr.

about Feb.

Alford,
duties

new

merger

who

1, 1954.

today,

of the

stated, "the
business and per¬

sonnel of the two firms in

represents

Chicago

combination

of Chicago's

ing

his

assumes

one

principal underwrit¬

firms with

nationwide

in¬

vestment

banking and brokerage
organization which had its begin¬
ning and is one of the largest on
the

West

Co.

has

Coast.

the

West

San

Diego, in
With

the

bracket

Seattle

addition to offices

New York and Bos¬

memberships in all of

country's

and

Witter

which

from

Coast

in Honolulu,
ton.

Dean

offices

principal security
Exchanges and

commodity

facilities for handling
of security and

action,

type

commodity trans¬

offer

can

every

fully

in¬

tegrated services to Mid-West in¬
vestors

and

industry."

You're the Best-Groomed Woman in the World

...

But

announcing Mr. Alford's ap¬
Dean Witter, senior
partner of the firm at its main
office in San Francisco, noted that,
pointment,

"in addition to

vestment
former
merger

broadening the in¬
services
available
to

Harris,

clients,

the

position of
Dean Witter & Co. for the com¬
banking

petitive period ahead. Harris, Hall
Company, like Dean Witter &

Co., has had broad

placement

experience in
and

underwriting

the

securities.

private

the

past few years, private placements
of the two firms have
over

Lady! Look at the Oil You've Been Using:

the

strengthens

Hall

further

investment

aggregated

That's what puzzles us, beau¬
pretty, Mrs.
America. You

derwriting

and

cleaners,

floor

polish than
Your

all"

Exch.

Weekly Firm Changes
has

any

vacuum

and furniture

wax

other

woman

are

whisked

down

York Stock Exchange

Maybe you've

crankcase. Or, maybe you
oil

cluttered-up closets, "catch¬

dresser

that

Frequent motor cleaning is

un¬

portant

Just

way.

won't you

unclean oil is bad for your car:

drawers

dirt

Edward H. Hilliard

Yet—there's that

your

child's dresses

floors.

partnership in J. J. B. Hilliard &
Son

December 1.

reminder

yourself,

household bulletin board?—

out

or your

automobile

it's

hardwood

motor

Take
for

car

Cities Service station

good, thorough motor cleaning

dirty oil under

different. The acid, carbon and dust

with Cities Service Solvent,

in over-used

change to fresh Triple HD Kool-

oil not only

your

they literally

CITIES
retired from

your

clip out this note and put it

which must be present

swept

under rugs in your home.

the hood of your car.

taster—whether

wear

slow down
wear

motor,

it out.

dis¬

30.

im¬

know, anything that's dirty

will

announced the following firm

Gilchrist, Bliss & Co. was

Well, it's not supposed to! Here's why

changes:

solved November

frequent house cleaning.

think all

supposed to look that

As you

curtains

never seen

pleasant fluid being drained from the

in the

and washed, almost before they need

$77,000,000.

it.

The New

toothpaste,

world.

participations in 1952

New York Stock

You spend more money on soap,

cosmetics

$290,000,000, while their un¬

alone exceeded

are

tifully groomed, shining with cleanli¬
ness.

the

from

insurance

banks

small

purpose

signed for the smaller banks, all
banks are eligible for participa¬

today

resident manager of

the

doubled.

Lore

Mid-West

new

made

was

appointment

Alford

Com¬

located in

banks,

the

about
to

New York City, announced

Insurance Plan

the

coverage

double benefits.

Dec. 2 that it is offering to

plan

States, which participate in its
Correspondent Bank Group Life

Alford Heads Mid-West

states

Manufacturers Trust

years,

with maximum coverage of $5,000
for any individual. Under the new

of California.

employee insurance
which may

was

President

Trust

and

banks

500

six

last

according to
the Manufacturers Trust Co., the
insurance coverage has been
limited to an amount approximat¬
ing the employee's annual salary,

Improved Group

Offers

A., on Oct. 1, 1953, joined The
National Bank of Detroit as a se¬
analyst

the

Life Insurance Plan

curity

Under the plan in existence for

Manufacturers Trust
Has

(2163)

(A) SERVICE

Quality Petroleum Products

motor Oil. Do this

regularly.

and

l.<

from

The Commercial and Financial Chronicle...

(2164)

—SEC Proposes Rule

Health and A
Prosnerifv
liuaillt ailU
ivajiuujr

forecast.

forecast

ROGER W. BABSON

While

effect of our national mental health
on
the business cycle and continued prosperity, holds if it's
true that emotion plays such an important part in individual
lives and

that

idpa

Vll l

Tfn shaie
want to ?ha,pTUwith
to wonde

beginmng

has

been

Jhat'pffppf
tsnnQi

0 u

aat'°"al

mental

hea

for

business

cycle

and

this

continued

prosperity.

—

nature tells

that

emo-

our

business

admit-

p.°'nt out'

babies.

crop

?r,

example, that after the successful

money,

employment, and sales

criteria

for prosperity. It
spiritual

Cycle

fects

continued

and

be that

our

health

may

af-

mental

business

conditions—I

don't

know.

■

ia«

fivo-wapb f.in ;n
~
F

had

ever

attend

chase

National
an

Bank

address

New

a remarkable
tion

dinner

meeting

know

that the emotional appeal of some
individual
will
override all
the

logic.

Every

election

national

has

been

political

won

emo-

sisters,

Hote,

New

York

cjt

Noy

BrtoSlhe^romlnen?
T

((T

physical rehabilita-

ection.

If, then, it is true that emotion
plays such an important part in
our

individual

political

lives, and
is it not just

scene,

sible that how

system

are

-n

fu„

eontrol_the

ness

conditions

feet

the

our

-j,

Area

for

Businessmen

sociologists,

impatient with

are

anthropologists,

and

psychologists because their experiments take so long to complete, and

costly. If, howpractical-minded social

are

ever, some

scientists

would

group

men

team

studv

the

with

open-minded

business-

effect

our

national

mental

business

™cle^an? prosperity

forecast

health

discoveries

great

the

upon

would

follow.

the

longer

iPWIMI

IIL

whole air

Wk.

problem
t

have

worked

than

minffi
turn

utnkn°w" sP;nt,ualother
and
that affects

r
factor

Prognost;cations. At the
century, Harvard's

the

Phe

?nn0h

,-e
50% of the patients who
his office for medical

nothing
cally.

with

wrong

Their

ills

that

numbers

they

poor

all

have

new

that

made

the

conclude

and

they

millions

F_i

Econotnjcs

what
as

positive

religion and

had

cause

know

from

industry

itself,
costly

many

sig-"

development

McCloy

which

pursuant

have

been

vali-

German

law.

not

Commission

has

in-

been

representative

exchanges

bonds, purchased for re¬
demption by the Germans and
held in negotiable form in
Berlin,
rency

which

found

their

authorized

hands

pation

Berlin

enacted

legislation

submission
German

for

the

1945.

ment

the

which certain is-

upon

traded that bonds which

have not

delivery"

"good

made

con-

against

those exchanges.

into

entered

States

John J. McCloy

because

there

has

the

been

leaders of the past. He is far

SEC- the Commission requested
brokers and dealers ,to refrain
fr0™.effectlng transactions in securities of German origin.
On
Eeb' 27' 1952 an Agreement on

government
in

relieving the people from longstanding controls. So much can
be bought now without ration
cards — without queueing up—
everyone is experiencing a
new sensation of freedom.
One
b°usewife said that she felt she
was bv*ng normally for the first
time since 1937 and my how she
enjoyed it! This transition means
a featdeal
fhe life of a nation

^ a ratlon- f,°
cb f?r
on

as °Pelated

of humor, usually ex-

sense

mankind. 'God,' he has said, 'in
His infinite wisdom has placed
'limits

External

man

Debts

was

have been validated pursuant to

They

and

political security
not the repository of atl

are
wisdom by

are sturdy,
t

they

are

not

bit

ership

German

issuers.

This

provision

W3S necessary because

*be large

volume °f German foreign

cur-

Bonds

has

been

established
jn
Registration of West

this country.

German bonds for validation with

the

Validation

Board

began

and

proud.
be

Detulant

our

methods<

our

course of his stupidity.'

He is

0Derates

both
on

the

roles

«
The

•

Securities

Commission,
notice

that

utility

convfction
conviction

and

Exchange

on Nov. 25, issued a
the SEC
has under

proposal to amend

under

Holding

the

Public

Company Act

exceptions

competitive
bidding
for the purchase or underwriting
of securities issued

Rule

sold

by reg-

U-50

its

present

and

sDidtuaT
is

adopted by the SEC in 1941.
in the cases specified in
paragraph (a) of the rule, (which
exempts issuance on sale Of se-

quidation

reorganization)'

A J

■

cases

AdVertlSIHg SafeS

■

GOnfereilCe

with its to old records of man's
strueele
be
indpnend-

■

Jan.

settlement

will

agreement

Transactions

other antifraud provisions of the

Vlew* a"d comments

the

proposal must be submitted to the

Commission in
than Dec. 7.

„

writing

later

...

sale

comnanv

the

issue or sale of any security
by any subsidiary company of a
registered
holding
company, \ if
the issue and sale of such security
are
solely for the purpose of

financing the business of
subsidiary
company
and

such
have

been

expressly authorized by the
State Commission of the State in
which such subsidiary company is
organized and doing business.
..

Conference

Committee

Re-

port (H. Rep. No. 1903, 74th Cong.,
1st Sess.,
provision

mission

67)

that

stated
directs

....

the

this

Com-

the issue of
subsidiary companies
in cases where holding company
abuses are unlikely to exist."
exempt

securities by

Under the Commission's present

Practice eachex^
quoted provision has been granted
by order 0nly and the procedures
followed have been

those.

equated

declaration

Sr Section 7

public
registered

holding company which is not itself a registered holding company,
if the issue and sale are subject

if subsidiary

company,

anDlicable

of the rule the issue and
its own securities by a

(b)
of the Act from the provisions of

hence

intended to prevent this. Transac-

?r.sa/eof

to exemption under Section 6

and

London.

competitive bidding. and policies
1S pr°P°sefd lo the
add t0 ,the substantially
excepted from
operation

already utility subsidiary

bdcoml"g a traditional one The
Germans are beginning to refer to
hlm as Der Alte'

and

Looted bonds will

bonds which have not been validated could
result
in
looted
bonds being unloaded upon inn?cent and unwary purchasers in
this country. The proposed rule is

The

form

was

re
ana spiritual re

debt

signed

of
which requires with certain

/1935,

™-not a bad combination,
Starting out as a rather colorless,

pro-

established

validated

man

reff;sfered holdinff

securities by registered holding
Un" com.Pan^s and subsidiary com-

noli

time

not

registered public utility holding

^n/hp reqUir+eS th3t the iSSUe

Jrnit

same

in operation.

curities pro-rata to existing stockholders or in connection with li-

him

validation

now

Would except from the operation ot Rule U-50, which requires
public bidding, the issue and sale of securities of a subsidiary

full recognition and acceptance of
his constitutional responsibilities
and limitations. Democrat or parcab

are

SEC WmM Relax Competitive Bidding Rule

Except

Accordingly,
cedures

—

what inclined to an authorization
approach in his administration of
government and party, but with a

walk through the British Museum

free and

wise man a true Westerner, some-

leadBut

intelligence

undynamic figure, he

They

restive

over

the

upon

September, 1953.

but He has placed no per- istered holding companies
ceptible restraints upon the full subsidiary companies.

th
peo-

dependent role and

inclined

and

b^t

talented, decent

courageous

do "°t relish

metan

any

the
and

German law will be paid by the securities acts.

man

Physical

agree-

between

Government

signed in London which provided tions in these bonds may, under
y West German bonds that certain
circumstances,
violate

from

pressed in terms of the foibles of

impor-

successful

all

not be eligible for payment under

December, 1941, according to the

paradox to the concept of German

lized

bonds,

currency

the Federal Republic of Germany,
a
Validation Board for German

Following the outbreak of war the

inclined to mix his faith with a consideration
certain cynicism. He has a civi- Rule
U-50

coronation paint, but

The

validation

foreign

un-

occu-

Germany has
requiring the

and in accordance with
United

into

way

after

Federal Republic of

of German bonds have been

sues

interesting

is anti-militarist, antinationalist, and deeply religious—

due

partially

presents

gather. He

the

was

Text
The

text

of the

filed

Rule

nara2ra„h

fa,

^be text ol paiagmph (a) ot

p„eend(?d 5° QPfd ?™d

follows®

ame"dad would laad as 'ollows'

<a> Sc°Pe °f Tule ~ Thls rule
Section 6 (a) of the Act. This is is applicable to every declaration
proposed in connection with the ?nd
application
legarding the
consideration by the Commission
°t

the

issuance

rules

which

and

ish'valor

the

r>,

registered
oy, any registerea
company or subsidiary

ownea

would

of Standard & Poor's Corporation,

lated

^45 Hudson Street, New York 14
Ne^ York' The, f?e cov1fs the.fu11

Seclion .3 (b) of the Act con. or (b) in connection with any
tains the following directive: "The liquidaUon or reorganization; or

recollection

when

quitting the

standard & Poor's Corporation,
*s sP0Ps0rin§ a conference on Advertising in Action to be held at
the Waldorf-Astoria Hotel, Jan.
ReSistration fee is $10 and
should be sent to John McKenzie

jmnressions

ent

Brit-

others

all

field

were

made

feel

that every ounce of understanding
and mutual respect which could

introduced

woulH

building
successful and happy

personalities.
studies

never

because

ill,

effect such forces

entirely

partially

who

are.

know

psychiatry

the

discouraged because

Emotions and
„r

are

ill

r
■

physi-

psychoso-

must

are

add

but

they think they
•'

them

who

doctor,

millions

think
are

had

care

were

will

psychosomatic
visit

came into

Ifhwe^'wiirari^'toThise^he
these

tonal'

tional.

huge

achipvp

most

the Rhine hills where the legends

had

it at any

this

r/eJJiaVerndered'l£(th?re

mental

bonds

? romantic figure—he i§ no Siegfried» although he lives up among

energet-

was

<<][ left London a§ain with And
forecasting
the the conviction that these people
iorecasung' ine were a soild eiemeni; jn our 0Wn ie„
aeep

the

HonhtPdlv

The

proposed rule

Gprmmv »

"He

jn^ejy brighter, and the

tantly

Study

Act

Exchange

the

Under

dated

imagination."

period. I think

nn«?twar

thp

expressed
high
praise of Chancellor Konrad Ade-

entire postwar

ing, manufacturing, and buying.
fertile

definitely

was

cje£_

af-

important factor in bank-

very

wag

themselves?

may

duce or attempt to induce the
purchase or sale, in the over-thecounter market, of West German

MJSH SSS2S&y?a'JSl
W yi

time

actually

feel

one

whichI

;.rs

seen

conditions

issued

nauer of West Germany, whom he

as pos-

We surely know that confidence is

reoresents

streePts wal,;ed

feel about busi-

Securities

1934.

parliamentary

nificant

*n London there
"e"
00K-

mothers,

York

banker stated:

and

sweethearts,
Korea, which won his

relative to
e

appeal

wives,

the

sales

Manufacturing Chemists government is in full force and
Association at the Waldorf-Astoria generally speaking, the moderates

SSrtSf iS&TJS
Eisenhower's

Exchange

notice that it has under considera-

sidered

the

Grpat

the opportunity

town

and

Nov.

b(%en validated will not be

d, France, Germany and Italy.

John J' McC1°y- Chairman of

York,

reveals impressions from

our

have

Commission

The

■

Chairman of Chase National Bank

tbe

sale of, West German bonds, not

—

extreme
has tried al
his appeals
24> revea,s hjs impressions gained right having suffered
heavily in
logic, and failed, he hur- jn a
recent five-week trip
through the last election, as did the Comrows away at our emotions
More
Englandi Fra
Germany and munists. There also has been a
often than not we succumb to the
jfajy
social rehabilitation as -'well
It
emotional appeal. Certainly, if we
Regarding conditions in
salesman

Securities

The

Satisfying these wants

|f|C(j|0y UPtlltllSlIC OH WCSlGm EllfODG PfOPTGSS
"
r
b

Psychologists of

Rof.r w. Babson

people

ripening

Qur

;

situa-

w°n"n ZrfTi Tp
would like
t °

and

business

h°>'se in thinking only of

might happen at

—-

benavior

ho"

Rnc/noc

the

form

o?,nrSihPhUflvior
our

and

...

validated pursuant to German Law.

certain

formed
a

what

point

attempt to induce purchase

would be a "fraudulent, deceptive,
0r manipulative act or practice,"
as used in Section 15(c)(2) of the
corne- 1 just wonder if we are not Act, for any broker or dealer to
now Placing the cart before the effect any transaction in, or to in-

T
^ derably afona> uPsets'

wonder

a fraudulent and manipulative practice for
dealer to effect a transaction in, or to induce or

and demands could conceivably
absorb the Products of expanded
plant facilities for some time to

in-

anri

^n^m^hi

autos,

the

Rather

spcuritv

attpnt'inn

Hividnal

nrplnn, ^iv
P

food,

war

economic

recognition

needs

flation has been halted. We have tion a proposal to adopt Rule Xtremendous market potential in 15C2-3 under Section 15(c)(2) of

are

bav? on
t h e

not

basic

emotiona?^Hriiin MoTe
import

thev

vou

strikes

costs

clothing have ceased to climb. In-

ot relations or mental health to business cycle.
h.vo

wages,

stabilized;

Trading in German Bonds

Would make it
broker

all-time

than*for 1952^116 ^dollarhas

1953

and businessmen would team ud on a
and businessmen would team up on a thorough study
thorough studv

crUntUtc
scientists

hit

been

the political scene, it is just as possible that our

has

high thus far. Production,

feeling about business conditions may actually affect the conditions themselves.
Forecasts great benefits would follow if

business decline in 1953,

employment

Mr. Babson, in discussing

economists

most

Thursday, December 3, 1953

bp wpll

into

our

rpnaid

relations

whprvpnd

the storms come"

.g"^'/ ,Ts
oirte In,c'udlng ?U
fonf®rence

.br0,,eb wPqt Germanv

bad

served

mlssl0ner from

where he

High

Com-

real political reform

well

Flack,

gL,nshine
feature

meeting.

the

specified
purpose of Section 6 (b) to place
primary regulatory responsibility

sales

counsel, of

Inc., will be
at the [luncheon
1

holding

company thereof except
(1) The issuance or sale of sethe local regulatory body curities pro - rata to existing
which is in the closest and broadest holders of securities of the appli-

upon

day to day contact with the regucompany.

terms and conditions

Biscuits,

speaker

implement

sessions, Commissi0n by rules and
Party, and spe- tjons or orders, subject

Vn,c
n.' coc
C
musicGene

1949 to l9oz, Mr.

McCloy said that there has been
a

regulasuch

cant or declarant (a) pursuant to
any preemptive right or privilege

(2) The
note,

deems

appropriate in the public interest

the

for

consumers,

the

protection

provisions

shall
of

of investors

exempt from

subsection

(a)

issuance of

other

any

evidence

bond,
debt

maturity of 10 years or less
commercial bank, insurance

company,

not for

vided

similar
institution
the public, pro-

resale to

finder's fee

other fee,

Volume 178

Number 5278

The Commercial and Financial Chronicle.

...

(2165)

commission,

or remuneration is to
be paid in connection
therewith to

any third person
ciate service

(except

tiating the transaction; or
(3) The issuance or sale of
curities

Consulting economist of the Hanover Bank in New York
nation is not

se¬

much confronted with inflation

Warns if

venting deflation.

registered holding

any

employees.

increases

wage

Commitment range is predomi¬

nantly 60 days and

beyond the

ponement of

growth of productivity, the increased costs could not be shifted

company or subsidiary
company
thereof whose acquisition of
such
has been approved
by

to the

mitments

consumer.

report on "The

Course of Treasury will be, but it is known
published by The Han¬ that the Administration is com¬
Act; or
' ' over Bank, Dr. Marcus
(4) The issuance or sale
Nadier, its mitted to and is working for a
of se¬
curities the total
v
proceeds whereof consulting economist, said that un- balanced budget. ", v
to the issuer or
d e r
a
present v "Should
sharper than ex¬
vendor will not
exceed
conditions
a
pected : decrease in business ac¬
$1,000,000; or
a

Inflation"

(5) The issue

;

and

sale

renewal of in-

public-utility company, which is
subsidiary company of a regis¬
tered holding company and is not
itself a registered
holding com¬

flationary

pany,

event

forces

(a)

Under such

conditions,

ogy, a govern-

how.

the

deficit

may

Act by

Section

curities

finds

spect
not

sale

(b)

hereof

such

issuance

(A)

appropriate to aid the
Commission (in carrying out the
provision of Section 7 of the Act)
to

determine

whether

commissions,
tion

rectly

the

other

paid

connection

are

indi¬

with

the

of such

appropriate

interest

investors
dition

for

from

sions of Section 6
to

aid

carrying

the

country's productive
now
can
provide both

capacity
and

guns

butter

civilian

goods

Dr.

Nadier

said,

what

see

cause

the

ceding

It is

and

may

appropriate

exempting

sale

Section

(C)

from

(a)

necessary

the

tection
to

the

finding

for the pro¬

connection

with

the

deemed

sion

this

National

Association

mittee,

preclude

from

the

entering

which

would

priate

under

Robert

chases,

proposed
in

rule

than

Dec.

must

writing to

the

31,

submitted

SEC

not

later

1953.

ment

Account

Mass.

Coleman

Doremus

—

the

announce

Executive

Cody

appoint¬

its

Boston

office, 53 State Street.
Prior

joining

Doremus
was

American

Optical

Co.,

Southbridge after his return from
a

second

tour

duty

S. Air Force in

served

uate

was

for

Captain.

three

Promotion

Manager

Harvard

with

the

Europe where
A grad¬

University,
years

and

station

Assistant

Merchandising
WCOP,

ton.

Bos¬

current

quite

number

source

tions

are

con¬

widely

of 'materials

during the past several
material'

prices

Such

shortages,

years

insure

supply. Present indica¬
that

number of

these

sea¬

sponsorship of the
Philadelphia-Baltimore Stock Ex¬
change on Thursday, Dec. 10, at
5:15 p.m. in the Board Room of
the
Fidelity-Philadelphia Trust
The

Company.

speaker

will

subject will be "Credit and Bank¬

ing Policy Covering the Financial

arrangements

may

discon¬

tinued, to allow greater freedom

often

ultimate

con¬

the

period of

How

strong
buyers' market and declining de¬
is

not

likely

Influences

Affecting

the Securi¬

ties Industry."

good

take

are

conditions

obtain wage increases
beyond the growth of productivity

increased

the

"This

lead

smaller

and ultimately to
output and increased

employment.

clining

Common Stocks?

employers, losses

some

others

creased

not

consumer.

would

profits for

could

costs

shifted to the

period

demand

stable

accompanied

de¬
un¬

de¬

money

productivity lead to lower prices
and

Bureau of Business Research,

higher real wages, and stimu¬

late

startling study by the

increased

demand."

How would you go

fairly static, and

are

"business

Hold

decline.

pound interest

down

again,

were

October. Production

the

for

second

tendency

the

down¬

materials

still

are

about making 121/2%

on your

money?

com¬

Prices

lower

In¬

purchased

the decline,

uled

keen,
to

postponement of sched¬

shipment.

quarter

Few

reported.

ployment,

both

worked,

third

month,

are

by
is

number

lower

re¬

in¬

move

Purchasing Agents feel that in¬
goods prices will tend to

dustrial

forces

analysts, then

the stiff

Research of the

University of Michigan.

In this issue, you

happened

with

will read what would have

$1,000

yearly in each of

automatically

good, bad and indifferent. We'll be much

sur¬

prised if this isn't the most debated financial
article of the year.
You'll find this and nine other

decline,

thoughtful

ar¬

with

official

magazine of the New York Stock Exchange.

continued

EXCHANGE,"

magazine "THE

the
lower
production
requirements.
Quite a bit of the cutback
is
caused by the run-out of seasonal

12 issues

goods and preparations for taking
year-end inventory. Few cancella¬
tions

are

ferring

mentioned, but

shipments

Feburary, which

depressing effect

This

de¬

may

have

for

newsstands

enclose

dollar bill

check

with

the

below

for

year's

first-quarter

pocket magazine is

not sold

January

orders.

and

for

the

efforts to adjust inventories to

coupon

sub¬

Employment

Pay roll registration and hours

reductions

worked continue to decline. Those

Buying policy is

reporting layoffs and shorter work

20 Broad Street, New

ditions
November

report

the general comment of

there

are

backs.

only

employment ad¬

Over-all,

Magazine, Dept. C
York 5, N. Y.

Enclosed is $1.00 (check,
Send

cash,

money

order).

the next 12 issues of THE EXCHANGE.

Individually,

few drastic cut¬
the

employment

purchasing executives is that in¬

situation

dustrial

policy; eliminating the floater, the

Over-all,

—

scription.

weeks outnumber

the

invested

arbitrary list of 92 stocks,

ticles

Unworked material stocks again
show

and under.

While

two-

look

Inventories

conservative, short-range, 60 days

not rosy,

ness

production efficiency.

the

but few

severe.

should

you

study just released by the Bureau of Busi¬

THE EXCHANGE

very

it did

year

really

consignment,

even

much

you as

read the November issue of THE EXCHANGE

testing

ventories and retain customers.

new

time

market

much

buying level. More

ports indicate the use of induce¬
as price protection and

Em¬

are

ments such

and

with

find

fourth-quarter commitments

first

Competition

strength.

possibility shocks
Wall Street

Magazine, reporting the essential facts of

Prices

shown

leveling tendency in November,
though the signs of weakness are
more
prominent
than those of

than

with

have

veteran

reported

spots.

Commodity
5

was

soft

some

general movement
anticipated.

closer

increasing
shrink the gap

inventories

sharp

competition

declining orders and out¬

with

been

and that is not

year-end, has not

at costs and

good sign. Prices are fairly

dustrial

the

over

soften, item by item,

month,
to

tinue

for

fewer

but

downtrend, while expected to con¬

business

not

pared to any normal

too

good

bad.
com¬

period., The

least

indicates

efficient,

selective

unnecessary

over¬

time, and using alternate shifts to

George B. Kneass, Vice-President,
Philadelphia National Bank. His

in¬

and

fourth

the

mem¬

ber of the advertising department

ward pace

C. Swanton

Robert

cancellations

Company, Mr. Cody

tr i

continued

static,

BOSTON.

u s

slow

between

Company

N ovember

put,

Gody in Boston

business

the

Doremus Go. Adds

Haven,

Conn., report

the

Arms

Company,

order

Re¬

peating

month. New orders

Comments

W i

chester

Commis¬

any

Di¬

rector of Pur¬

otherwise be appro¬
the applicable pro¬

and

shifted

is
C.

Swanton,

visions of the Act.
Views

can

whose

Chairman

with

shall

Purchas¬

ing Agents' Business Survey Com¬

declaration

rule

pur¬

chasing agents who comprise the

made

fees

any

paid

still

are

opinion

application regarding such issu¬
ance or
sale,-or upon a separate
application for such a finding.
in

releases.
become

If this
composite

Nothing

used

had

lecture of the current

under the

son

not too bad."
A

consumers

may

escalation

monthly

tracts

tional

Continuing at Slow Downward Pace

respect to sales of securities sub¬
ject to Section 12 (d) of the Act.
Such

the

industrial inventories

provisions

wages

con¬

Act;
appropriate

reasonableness

renewal

issu¬

maintenance

commissions

vestment Women's Club of Phila¬

delphia will hold its third educa¬

con¬

Survey Committee of National Association of Pur¬

conditions,
the' re¬
ceipt of adequate consideration or
the

re¬
one

international

position

competitive

boom,

costs

chasing Agents, notes, however, prices

for

the

investors

assure

are

war

therefore

cause a

fiscal

Business

im¬

such

the

PHILADELPHIA, Pa.—The In¬

important part of

period

crease

could

Simi¬

psychology."

Business

the public interest

reported change in policy on
the* annual requirements contracts
subject to quarterly adjustments

University of Michigan

(in

provisions

the protection of investors

ance

some

of the Act,

the public interest

sumers

met,

difficult

impossible, he said, to state

what

6 (b) of the
Act) to de¬
termine such terms and conditions

pose in

been

event

might

fear

demand

psychology.

foresee

the

has

"it

dangers of

event that

the

internal

fear

Section

and

for

con¬

provi¬

generally men¬
particular interest is

To Hear Kneass

first-quarter

Should labor under present

such

Commission

the

out

the

(a)

exemption

sale

public

protection

consumers

the

issuance

the

com¬

price structure.

"In

problem

are

place.

Since

consumers;

price

inflation,

Nadier

Dr.

this

cannot

the

de¬

costs,

mand

terest

(B)

Labor

not

report.

larly

will

sumer.

reasonable,

investors

sharp

deflation."

confronting the nation is not in¬
flation but the prevention of de¬
flation, Dr. Nadier contends in his

whether any term or condition of
such issue or sale is
detrimental
to the public interest
or
the in¬
of

nation

rather

mands.
The

fees,

remunera¬

directly

issue, sale, or distribution

securities

the

tinued,

re¬

sale

Nadier

deficit

confronting

but

labor
Marcus

with

matter

Treasury

be, the problem

or
unreasonable

se¬

with

large

ex¬

sonable

the Commis¬

compliance

plant capacity and by a de¬
in the disposable income.

rea¬

beyond

pectations,

that

paragraph

(b) of the

which

ment

the

reason

(6) The issuance

sub¬

such

provisions of Section 6
Act; or

sion

idle

such issue

provisions

the

subject to exemption

and sale are

the

only

sub¬
stantial
decline in
revenues,
it
will be accompanied by an in¬
crease
in unemployment and in
a

crease

sidiary company where
from

set

can

tivity take place, causing

through
an
creating
fear
psychol¬

securities

Phila. Inv. Women

Post¬

under.

fourth-quarter

into

delivery is
tioned.

Commission pursuant to Sec¬

tion 10 of the

negotiation
swings occur.

Buying Policy

says

it is in pre¬

securities
the

asso¬

for nego¬

company)

spread the work and retain good

Deflation Is Nation's Main Threat: Nadier

Zone.

.State.

The Commercial and

(2166)

Two

ities

By BEARDSLEV RUML*

his

own

kind

one

from

income

another

the public using the facil¬
ities; and the other, those that
might receive currently by lease
or
by contract from the appro¬
priate department of the Federal
local

government the revenues

necessary

for self-financing authorities as lower
taxes, maintenance of essential expenditures, and protection
of currency by making possible balanced budget at high
employment levels.

their

from

billion annually and that taxpayers
are being required to finance government projects capable of
supporting themselves, calls "so-called" Federal Budget only
a
listing of numbers with no overall financial meaning and
without economic significance.
Lists the "inescapable" goals
needs by $12

overstates tax

distinguished, those

derive

charges

technique

tion

program

for

and

costs of opera¬

cover

financial

annual

charges

interest and amortization.

cluded

the

latter

class

In¬
Au¬

Surplus

dent

Open

plus

should

brought out
where it can be

the

open

and

where

can

the

1953

Charles

General

was

Members of its first board

Dawes.

included Harvey Couch and Jesse

The current social security sur¬

general classes of Author¬

may

that

Ruml, insisting present Budgetary accounting

ample New

Budget Reform—Round Two
Mr.

Social. Security

Put

states and cities, for ex¬
York and Pittsburgh.

many

Financial Chronicle... Thursday, December 3,

Jones.

into

seen,

unborn

yet

which

subject

less characteristic

A group

the

Senator

Byrd

New Deal to
refers could

public discussion and public
policy. And that is exactly what

hardly have been found.

would

poration was established as a selffinancing institution, authorized

happen

with

the

consolidated cash

The

accumulating

The Reconstruction Finance Cor¬

adoption

budget.

reserves

retirement

eral

restored

ployment

accounts

investment

are

must

and

Secretary Mills explained to the
Senate Banking & Currency Com¬

mittee

em¬

avoid

Under-

to issue its own debentures.

the social security and other Fed¬

why the Hoover Adminis¬
wanted such a
separate

tration

de¬

pression.
We
cannot
withdraw financing corporation. On Dec. 19,
thorities could be real estate pur¬
1931, Undei'-Secretary Mills was
between $3 and $4 billion a year,
chases, construction of productive
questioned by Senator
year after year, from the people's closely
government buildings and invest¬
three months, some of the
The questions and an¬
Three months ago, on Aug. 12, past
income without restoring it in ap¬ Bulkley.
ment in atomic energy plants for
swers
have more than historical
changes have already
1953 to be exact, I testified before suggested
propriate ways to the flow of pur¬
the production of plutonium. The
been made under the pressures of
relevance to the present discus¬
the Ways and Means Committee
chasing demand.
Defense Department buys oil on a
sion.
And I am setting forth a
which
was
conducting hearings the ill-advised ceiling on the Fed¬
As for the present social secu¬
eral debt limit.
There also have contract basis; why shouldn't it
few paragraphs as an illuminating
on Federal ex¬
rity payments as a burden on in¬
been some unfavorable editorials, buy plutonium?
cise
taxes.
I
commentary on the thinking at
dividuals, they are now far less
Few would dispute the business¬
mostly in smaller communities in
that time.
testified
that,
than would be required if the so¬
the South and Southwest and also like principle that truly producing!
with the usual
"Senator Bulkley: What is the
cial security reserves were to be
in a few larger cities, such as De¬ assets should
be capitalized, and
exception
o 1'
built up to a true actuarial basis. advantage of raising these funds
troit and St. Louis.
that
the
benefits
realized
from,
the excises on
corporation
debentures
Accordingly,
the
individual re¬ through
these assets should be paid for as
Obviously we need a Federal
ceives in the present value of fu¬ rather than by a direct issue of
alcohol, tobac¬
Budget Reform program, and with they are consumed. The financing, ture benefits much more than the bonds
by
the Treasury,
which
co
and
gaso¬
of Authorities on a self-financing
Budget Reform, not only can the
amount
of
his contribution
and would be easier for the public to
line, the disbasis will, of course, necessitate, a
selective excises be abolished, but
that of his employer. There would understand?
criminatory
all other tax reductions now writ¬ rate structure appropriate to the.'
"Under Secretary Mills: Oh, I
appear to be no reason why these
selective
e xcosts.
But there
is
no
logic in.
ten into law can proceed as in¬
rates should be reduced now in think it is much wiser to do it
cise
taxes
this year's taxpayer to
tended by the Congress? The re¬ forcing
view of the government's commit¬ through an independent corpora¬
should
and
ductions in the individual income pay for benefits to go without cost
ment to social security payments. tion rather than to have a direct
could be com¬
tax can proceed; so also the elimi¬ to future taxpayers for years to
On the other hand, social security obligation of the government. . . .
pletely
drop¬
nation of the excess profits tax; come.
rates cannot be put on a true ac¬
"I think you can create a busi¬
ped, and that
the reduction of the corporation
My estimate for Authorities is tuarial basis without
putting the ness entity that will deal with a
no
new
taxes,
Beardsley Ruml
profits tax from 52% to 47%; and $4 billion annually. But I believe
government far more into the total particular problem which is essen¬
retail
sales
that a conscientious and imagina¬
the return of excises on tabacco,
economy than has ever been re¬ tially a banking problem. I should
tax
or
manufacturers
excise
or
alcohol and gasoline to the level tive study of the opportunities for
sponsibly contemplated.
hesitate a great deal before I in¬
other tax, are necessary to take from which
they were raised in reclassification of expense would
trusted this whole job of loaning
their place. The reason is simply 1951.
in time result in a figure even
Rebuttiiig Senator Byrd
this—the net loss to the Treasury
government
funds
directly and
higher than the $4 billion sug¬
Senator
Byrd
objects
to
the turning the Treasury of the United
from the elimination of the selec¬ Overstatement of Revenue Needs
gested.
budgetary treatment of capital and States into a glorified bank."
tive excises referred to above is
The overstatement of the need
I am well aware that the treat¬ investment
items, even when care¬
tf.
#
j;J
$3,400,000,000 and the present sys¬ for tax revenue of $12 billion an¬
ing of capital items and Author¬ fully defined, so as to be separate
tem
of Federal financial
record nually for fiscal 1954 is
composed ities
".
frankly
I would
much
separately is susceptible to from ordinary current expense.
keeping, the miscalled "budget," of four principal parts as follows:
abuse
and
I
would
limit
such He calls such treatment "a com¬ rather see this corporation issue
overstates by $12 billion annually
treatment strictly to the two obvi¬ bination of
Billion
threadbare budgetary its own debentures than to confuse
the need for tax revenue.
ous
categories of assets which I subterfuges which were originated it with our public-debt operation.
(1) Reductions possible by
Since giving this testimony last
In the matter of accounting and
have just specified.
as ideas by New Dealers over the
efficiency and economy $2
August, these figures have never
(2) Capital items improp¬
Fourth. The result of going on to past 20 years, but cast aside, even presenting an accurate picture, I
been challenged, so far as I know,
think the accounts of this institu¬
a consolidated
erly included as expense
cash budget would by them, as too phony or too mis¬
2
except in one respect. It has been
reduce by $4 billion the apparent leading for serious consideration." tion should not be merged with
(3) Investments that could
pointed out to me that the figure
the public-debt
accounts of the
be organized as self-fi¬
Federal
On this point, Senator Byrd's
requirements
for
tax
I
.

used for atomic

tions

includes

items

tary

high by about $1
other

hand,

installa¬

energy

some

and

purely

billion.

within

too

and

poses,

based

I feel that

of $12

ure

current

correction

critical

can

billion

analysis,

hold to

fig¬

our

representing

overstatement

annual

tax

requirements; and that there¬
fore, with Budget Reform, the tax
reduction policy contemplated
by
law

and

herein

is both

proposed

desirable and realistic.

Incidentally, the Federal Budget
for

1954 included

"Additions

$26.6 billion for

Federal

Assets."

The

amounts involved, says
the
Budget Message, are additions to

the

type

assets

which, under
private accounting practice, would
normally
sheet.

appear

the

whole $26.6
current

Budget the

billion is

included

However,

figure which I have
smaller,

balance

Federal

expense.

used

the

is much

total of $6 billion, since
this proposed Budget Re¬

under

form, I include
nue

as assets only reve¬
producing and receiving assets

that

can

their

amortization;
and

articles

after

interest

and

earn

commodities

intended

for

and

resale,

allowing for storage, depre¬

ciation and other costs.

Although the
lion

seems,

$12 bil¬
to be ac¬

therefore,

tuere

nevertheless

ference

opinion

should

reasonable

figure,
sharp dif¬

undertake

whether

Budget

Reform program that would
duce

the

budget

tax

I shall discuss each of these four

items

requirements

balance.

There

has

only
A

has

mildly
talk

since

Mr.

terest.

low

figure

.A'.ademy of Political Science,
City, November 5, 1953.

before

New

little

the figure
that there

dispute

be made by

that such

larger
requirements

efficient economy,

point of view to do
Second.

Capital
as

every

so.

improp¬
These

expense.

are

kinds:

two

re¬

sult in the acquisition of revenue-

producing assets.
spicuous of these
mortgages,

lar

holdings

such

and

most

con¬

the F.N.M.A.

the

$2,250,-

are

rural

other simi¬

RFC,

small

electrification

(b) A different class of capi¬
are
purchases intended

tal

assets

resold

under

circumstances.

appropriate

Disbursements for

stockpiling of strategic mate¬

rials
any

are

of this class.

expenses

terioration

are

To be sure,

storage and
current

de¬

expense

items; but the cost of acquisition

the

York

unfortunate

both

that

parties.

the

change

not

made with the beginning
new fiscal year which has

the

insuper¬

able difficulties about
making the

change-over at

time,

any

say

Jan.

1, 1954.

similarly

Investments

organized

"Authorities."

that

con¬

could

self-financing

Some may not like

principle

Ways and Means Committee.
It is my purpose to answer, to the
extent that time permits, Senator
Byrd's

doing

communication,
so

the

have

objections
to

cash

disagrees.

others

that

going on to a
budget, Senator

The

desirability

going on to a consolidated cash
budget in order to bring in the
operations of social security is so

generally recognized at the pres¬
ent time, as a result of technical
studies

and

practical

observation

his

the past decade,
that for
those who, like Senator Byrd, still
hold the opposite opinion, no brief

exposition

the

subject

would

I only refer here to

present

meaningful

and

re¬

self-financing Authorities

ir¬

validity ol

position

ment it is

for

In this State¬

ob¬

Morgenthau

"Under

explained, "CED's main
using the cash

budget

inflationary

deflationary

Byrd's

formed.
who

This

consideration

analyzing the need for,taxes.

Not

I think it would

billion dollars.

distorted picture of the
debt, because presumably

give you

pubic

all of those funds would have been

loaned

be an entirely
public debt than
which is outstanding today
would

the

recom¬

Federal

Govern¬

ment, the Reconstruction

Corporation.

The

RFC

Finance
was

re¬

garded by President Hoover "as
capital in character.
Except for
its original stock of $500 million,
its

lending and borrowing

tions

and

represents,

the

without

saying—but

sential

average

The

Finance

opera¬

were

of 63 to 8 in the Senate and 335 to

construction

the

RFC

was

22,

Hoover

year,

bi-partisan, indeed
non-partisan group, including

Governor

Federal

Eugene

Reserve

Meyer
Board,

the

Andrew

Mellon, Secretary of the Treasury,

Mills,

George.

and

Under-Secretary

and Senator Walter

The

Currency

Senate

Banking

Committee, before

which the Reconstruction Finance

Corporation legislation

was

thor¬

oughly debated, included men of
outstanding financial capacity such
Senator

Glass.
was

The

Couzens

and

Senator

fir^t RFC Chairman

Eugene Meyer, and its Presi¬

the

House,

the

and

Re¬

Finance

Corporation
its operations on Jan.

commenced

recommended in 1931 to President

its financial

creating
the
Re¬
Corporation
passed by Congress by a vote

what

bills

construction

budget of his Administration.
creation

the

is."

the framework of the expenditure

The

that

interested,
just what the govern¬

and

owes

situation

equally es¬
in readily

form

if he

man,

find out

ment

them

keep

understandable

can

costs

war

within

included

not

were

which

solutely accurate form—that goes

1931,

one

unin¬

are

Congress the creation
largest self-financing cor¬

the

collateral, and it,

good

President Hoover,

comments

was

December,

mended

important

Mills:

Secretary

generally
and cur¬
rent deficits. It has always seemed
to me that it is not only essential
to keep all public accounts in ab¬

But worse than irrelevant, Sen¬
ator

that it gives a better indication

the

obligation?

different form of

Secretaries

the Treasury,

reason

guarantor, it is obli¬
as if it were its

same

direct

therefore,

Ogden

consider

judge the

Committee for Economic Develop¬

effects of Federal finances."

made

the

gated

serving the fact that Senator Byrd
finds himself associating with the
budgetary ideas and policies of

over

been

spectable by the conspicuous suc¬

gations
own

lars, the public debt would go up

poration

attention.

respect to

consolidated

Byrd

I will have also met most

come

With

since

government is on these obli¬

itself. Certainly Sen¬

relevant
own

see no par¬

quite; but, supposing we were
obliged to furnish a billion dol¬

but

program,

would

Byrd

for merging; but,

hardR

the program
ator

the

reason

speaking

of the

cannot

ticular

ing social security from the oper¬
ating accounts of the government.

the term "Authorities," but it has

cess

be affected by New
sponsorship nor by New Deal
opposition.
We might judge the
New Deal by its attitude on a

the

Deal

ment of April, 1953.

are

made by Senator Harry Byrd
letter to Chairman Reed of

was

the recent Policy Statement of the

should

comments

Government.

States

"Senator Bulkley:

the

be persuasive,

Third.

Byrd's

validity of
principle of budgetary account¬

ing

United

un¬
.

irrelevant because
a

and

and Snyder, with respect to in¬
cluding capital items and exclud¬

the

Lending and spending for
holding of agricultural sur¬

irrelevant

most comprehensive attack
these Budget Reform proposals

The
on

are

former

see

is not.

sidered.

and

persons

just started; but I

Federal

holds

now

And there

business
loans,

are

of which

Government

000,000.

The

Senator

items

Those disbursements that

(a)

even

desirable from

erly included
capital items

port
was

in¬

be attained by sensible

can

would

and

economy measures.
reductions
in
tax
can

to in¬

national

placed

informed.

has

years

Advisers, and the
1949
Senate
Sub-Committee on Monetary and
Fiscal Policy, headed
by Senator
Douglas. The change has the sup¬

the

$2 billion

can

comments

stu¬

change
for

Committee for Economic Develop¬
ment, the Council of Economic

maximum. extent

have

item

economy

favor efficiency

economy to the
consistent with

pluses

during the

Ruml

that I

re¬

The Administration's
been negative, but
so,

have included

efficiency and

dicate

strong support for this program in

altitude

detail, but briefly-

First.
for

been

legislative and business circles
in the press.

for

$12

been

organizations, and govern¬
agencies—among them, the

dents,

ment

the

amount of

ceptable

budget__

This

revenue.

recommended

on a con¬

the

subject
we

Result of going
solidated cash

So for practical pur¬

future

(4)

On the

military
there are a number of offsetting
items of continuing capital value,
real estate, convertible buildings
and the like".

nancing authorities

mili¬

therefore

Towards the end of the

1932.

Dec.

Hoover, in

1932,

message

President

to Congress

the Budget said: "The authori¬

zation

large programs of self-

liquidating works to be
by
the
Reconstruction
Corporation

ployment
the

provides
.

financed
Finance

aid

without burden

em¬
upon

taxpayers."

Long

before

Federal Land

this,

1916,

Banks had been

tablished under

the
es¬

Democratic Ad¬

Federally-owned,
Their
purpose was to provide long-term
mortgage credit to farmers.. Here
ministration

self-financing corporations.

Number 5278

Volume 178

The Commercial and Financial Chronicle

...

except for the initial capital

too,

stock,

the

items

that

were

acter

from

to exclude
capital in char¬

policy
the

was

operating

regular

accounts of the Government.

Senator

Byrd

agree,

for

reform

and
his

repeat

seem

under

Committee,
namely the speedometer so that it reads
specified cir¬ 65 miles when it is only going 45.
cumstances separate financing to This father would spend his time
carry a capital investment in in¬ better in persuading his son that
ventory loans is desirable, straight¬ speeding is dangerous.
The boy
forward and in the public interest. will soon learn that the doped-up

about

dis¬

closure of the purposes for which

the Federal Government is spend¬

ing and taxing." Where we differ
is on important questions of policy

Whence

Byrd

"The Ruml
proposal would set back budgetary
disclosure 20 years."
says

Following

Mellon
fact

that

would

set

Hoover

Authorities?

proposals
Federal budgetary dis^-

Mills,

Senator

back to the

Glass,

Secretary

President

Ogden

Mellon

and

Hoover.

Twenty years
detour was made,

1933, a
protested unsuccessfully by many
New Dealers, a detour from the
straight road of businesslike pub¬
ago,

lic

finance

into

and

public
of

morass

fusion in which

accounting

budgetary

con¬

find

now

our¬

selves, and which has already done
incalculable

harm.

Senator

interest

Byrd
the

refers

culated

imply

part

the

True, I

removal

sources

insincerity
of

Budget

interested in

tutions and

selective

and

with

cal,

And

ments

since

the
tax

present

require¬

by $12 billion, most of the
realistic

Budget

Reform

program and that no general sales
tax or manufacturers excise tax
would

required

take

their

place.

of fiscal

equally persuaded that
lower personal income tax and

lower

corporation

profits

tax

nation
of

the

proposition
tional

interested in efficient

that will not cripple the vital

omy

constructive

and

tions

Federal

of the

And I
and

econ¬

will

allowances

budget.
that

one

moves

in¬

inescapably to

the necessity of a Budget

Reform
program that will permit lower
taxes, and the maintenance of
essential
expenditures, and
the
protection

the

currency

making possible a balanced budg¬
et at high levels of employment.
Since I testified before the Ways
and
Means
Committee, the Ad¬
ministration
has
taken
steps to
expand the financing of loans in¬
with

connection

volved

the

counts

the

government.

Sept. 25 Ihe Department of Agri¬
culture announced that "in view

and

time

same

generally accept the

that

There

the

na¬

balance

the

two

are

reasons

convincingly

budget

policy.

bal¬

heavy

crops

such

through

much

loans, thus re¬

possible of a financial

which

have

would

taken care of through

rowing.
est will

public bor¬

Certificates of inter¬
the

first

time in connection with CCC

grain

offered

for

now

certificates

Administration

policy. There is clearly no subter¬
fuge. All the facts are disclosed
to the Congress and to the public.
A more logical approach to the
CCC
problem
has been
made.
This particular example illustrates
the

For those who want

First

tax.

forms of

new

taxation, their arguments have
much

little

Budget Reform
der

present system

our

cial

they have

record

keeping.

with

cogency

un¬

of finan¬

But

must

confess that the urgency to act on
their

proposals will be far less.

Lots of Subterfuges Legitimate

There have also been attacks by
name-calling, in which they refer
to the proposed Budget Reform as
a
trick, a subterfuge, as legerde¬

main.
tion

For

that

trick

airplane

vaccina¬

matter,

against

smallpox,
subterfuge to

avoid
all

walking to California, and
surgery is legerdemain,
very useful it is, too.

good

and

Finally, there is the understand¬
able hesitation

the part of the

our

financial

merely

problem'

changing

the

rules.

Federal

will

re¬

quire real courage in the Admin¬
istration

recommend

long-overdue

changed

these

the

statement

the

protect
And

that

These

fact

our means.

and

are

that

wants

the

good

the

reasons

public

ear¬

have

the

word

"balance"
no

make

keeping.
budget that is a hodge¬

cynical comment that the Ad¬

the

other

toward

fiscal

"hand,

perhaps

for¬

tunately, the Administration

will
If it

Unfortunately,
be

embarrassed
not

tfoes

to;

the

are

see:

same.

the

present
so-called Federal Budget is noth¬
ing more than a system of finan¬

lest in

All

taken

together,

whatever historical interest

of
ad¬

ministrative convenience, it is only
a

listing of numbers with

all

financial

leading
the

no over¬

meaning. It is mis¬
guide to appraising

impact of

the

Federal

Gov¬

will

program

shifting

It has

economic

What

the

obstacles

Budget Reform program?
The

first

that if the

general

criticism

budget reform

program

tax reform

constructed

will

and

sands

tax reform

signify

We need a Budget Re¬
form program that will replace
our
present system of financial
record keeping with a consolidated
cash
budget that will separate
are

shall

know

what

the

eased,

and Congress

point that I made to the Ways

will

Abuse

counting

superficial.

Even if the tax

burden is reduced, taxes will
be

dangerously heavy, and

sound

duction

will

the

for

required
taxes

Congress

deceived forever

know

its

capital items

will

vate.

incorrect

covered

the national

numbers

ac¬

The deception is

father who wants his

drive the

miles

automobile

hour, and

only

dopes

been

credit and

experience.

dom,

ac¬

European

the United

King¬

mild example, govern¬
ment outlays "below the line" or
as a

outside
been

the

tionary presure since the war.
regular budget has shown a

respectable
the

£3.3

six

billion

Writing in
lem

1948

York

New

Stock

changing the name
of their firm to Rotan, Mosle and
Cooper.

retiring

from

other

Marvin

the

Moreland

firm,

but

all

partners

will remain. Rotan,
Mosle and Cooper maintain offices

Beaumont,

veston,

well

Texas
as

and

Gal¬

how

out

ceipts

the

and

ordinary

Reform

firm

LAUDERDALE,
name

Andrew

Fla.—The
B.

Knox

and Co., 207 East Broward Boule¬

reaclf.

John Latshaw to Be
E. F. Hutton Partner

meaning.

the
was

reported
real

Hicks

Professor

any

also

took note of the dangers in aban¬

doning the principle that expendi¬
should

tures

financed

out

taxation:

John

Latshaw

Paul Uhlmann, Jr.

"Hitherto, excepting in time of Company, members of the New
war
and postwar resettlement, it
York Stock Exchange, and will be
has always been possible for the
in charge of a new branch office
Chancellor, when faced with a for the Hutton firm to be located
proposal to spend (say)
lion

£10 mil¬

desirable

some

these terms:

'If

agree

with that proposal, I shall have to
find
£10
million
of
additional
Where

revenue.

there

still

any

this

revenue

the price of

this

answer

last

ques¬

tion might be yes or no;
was

the

but if it
answered in the affirmative,

decision

the

spend

counting of the cost.
out

money

But

taxation

without

abandoned

fair

now,

cease

met

its

place,

to be counted.

will

the

Stock

Ex¬

The

staff

shaw,

Uhlmann

will

which

Lat¬

dissolved,

will continue with E. F. Hutton &

Company, Russell K. Sparks being
of the trading depart¬
H.

before

World

ment,

and

of the

municipal department. Wil¬

Appel, manager

liam McGovern,

office,

will

unlisted

for E.

become
&

York

New

manager

trading

Hutton

of Uhl¬

manager

Latshaw's

mann

department

Company.

Paul Uhlmann, Jr., a partner

will become assistant to the Presi¬

dent

Standard

Com¬

Milling

al¬ pany. He will continue to hold his
the membership in the New York and

enlarging

no means a new

Even

Detroit

and

American

This is

Street.

membership

in
other the firm of Uhlmann & Latshaw,

expenditure could

10th

his

changes.

wholly

any

being put in

principle

West

manager

expenditure?'

"The

111

Midwest

it?

expect the

can

country to accept

find

source

which I

open

object, to continue

The

les¬

War

mann

Stock

Exchanges.
of Uhl¬

corporate affiliate
&

Latshaw,

will

continue

extraordinary budgets as Uhlmann & Latshaw, Incorpo¬
Rene Sturm, in rated, acting as underwriters of
his classic, "The Budget," pub¬ general
market
securities.
Mr.
lished in 1913, pointed out how Latshaw will remain as President.
or

bad

is,

easy

name.

with

double

budgets,

shift expenditures from

the other

classification

ing

theories

quoted

chang¬

Mr.

means

to
of

the

extraordinary

"the juggler's
which

the

cup

Minister

by
of

disposes of the deficit."
Ruml
notes
that
cynics

balancing by "definition." One
cynical to ob¬
serve
that this is what it would

does not need to be

be.
two

past President

City,
and
a
former Viceinterests dictate. President
of
the
National
Se¬
Belgian Statesman
curity Traders Association. He is

Finance
Mr.

sas

budget

Latshaw is

of the Bond Traders Club of Kan¬

or
a

likened

who

one

member of the district commit¬

tee

of the National

Securities

Dealers,

Association of

Inc.

Spring, Stewart to Admit
Effective

December

11,

Bertha

limited
It would be difficult to get partner in Spring, Stewart & Co.,
25 Broad Street, New York City,
experts to agree just where

line

drawn

between

vard, has been changed to Knox-

the

Hinds and

ordinary and extraordinary—or to

Company.

pity to give
within

re¬

outside

budget

might characterize his budget plan

FT.

closely

in the

development of

payments

British

threatening to deprive
budget
surpluses
of

in Houston.

Now Knox-Hinds Co.

goal

"The Prob¬

Budgetary

capital

are

It would be

Kingdom," Professor J. R.
Hicks, while espousing the prin¬
ciple of capital budgets, pointed

had

Exchange,

United

Mosle and

705 Travis Street,

forts.

tionalized undertakings, evidently

son.

the

dis¬

has increased very considerably.

Firm Name to Be Rotan

demands

31, 1953. Nevertheless, though a
KANSAS CITY, Mo.—Effective
precise total is not published, the January 1, John Latshaw will be¬
gross debt, including guaranteed come a partner in E. F. Hutton &
obligations issued to pay for na¬

deficit."

Moreland,

ing money and spiraling prices—
is worthy of these costs and ef¬

surplus
March

ended

years

ways

members

meet.

budget have
persistent source of infla¬

The

over

heavy tax load.

regular

ity and

HOUSTON, Tex.—Rotan, Mosle

of borrowed

ments

currency,

common

Additional

and

capital outlays to be financed out:

result of weakening

budget will be supported by clar¬

pay¬

pri¬
Congress will not be misled

like that of

ac¬

appropriations
can

receipts, public

counting sheet.
son

to
not

want

by interest and amortization
ments from

re¬

down.

by faulty

Congress will

whether

every

expenditure

still

burden

Furthermore,
be

measure

still

written.

once

taxpayer cretion in expenditure. The re¬
ward—protection from depreciat¬

the

spare

but with the

has

states:

extra-budgetary

the cost would

Cooper

definition

govern¬

the "Bank Letter"

budget is and what balance means
our aspiration for a balanced

become

irresponsible in the making of ap¬
propriations. This criticism seems

keep

Mr. Ruml gets a total of $6 billion,

money.
Another ex¬
pert, elastically, could find $12.
concludes, despite some pro¬ billion or maybe $18 billion. Once
posed
changes
in
the
Federal the firm rule of balancing cash ac¬
Budget accounting, the single or counts is forsaken, there is no
so-called
"cash
consolidated clear stopping point for deficit fi¬
budget" is, for practical purposes, nancing.
the most satisfactory. In the con¬
The balanced budget test is a
cluding paragraphs of the article, hard test for national

and

purpose.

Beardsley

and

ture

taxation.

Then,

Bank of New York, in its Decem¬
ber issue, discusses reform in
gov¬
ernment budgetary
procedures,

financed, the principle of meeting expendi¬

and

expense

bad name." Comments

The
"Monthly
Bank
Letter,"
published by the National City

clearly capital items' would have been made with

the items that should be

all

treated

this

pro¬

nothing.

are

Otherwise

program.

from

of money.

Budget reform

Ruml's program.

reply in

A Budget Reform program

private economy and
significance.

suffered

tradition.

indispensable

items that

the sound¬

better

of wisdom rather than

We need

ernment's intake and outgo on the
on

em¬

embarrassment

might be

cause

gram.

items, of exclusions and in¬

Since

cause

the

record keeping.
It is in fact
hodgepodge of current and ac¬

right thing

doing so it would be

in the

clusions.

way.

probably unavoidable in either

case,

cial

crual

either

the courage to do the

figures

well-known,

put through the Budget

columns

our

questions

be made.

step

solution

requires
that these reforms in our budget
policy

barrassed.

first

the

firm

be balanced except by adding-

totals

attempting to bal¬
the budget by definition. On

can

the

inevitable amount

to Reform program only because it
of will be embarrassed, it is sure to
Cer¬ be embarrassed because it lacked

podge of capital and current items

whether

Budget.

system

record

Federal

wants

one

traditional

"budget"

word

the

ministration

the

Certainly

tainly

and

there will be

ance

security of a
budget make it impera¬

balanced
to

from

for

these

fact

tive

of disci¬
us

wanting
to
balanced budget and the

the

sure

understandable

are

that

and

make

keep

reasons

achieve

firm test

will

spending beyond
good

value

second

have

pline

counting.

excise

Not only will the inertia of tradi¬
tion have
to
be
overcome,
but

panded financing outside the regu¬
lar government accounts through

banks

manufacturers'

general retail sales

get

interest

operating budgets, "had

impose

or-

loans, an ex¬
tension of a practice already in
effect on cotton loans."
This ex¬

and other commodity

private

Federal

tax

taxation—especially

the budget in

to be financed

lieving the United States Treasury
burden

forms of

loans this fall,

funds in CCC crop

venient to their desires
new

the
con¬

dhr

is adopted, showing that tax re¬
the quirements are presently over¬
stated by $12 billion, the pressure
program
is intended to achieve
maximum
investment of private for cutting expenditures will be
of the

find

system

Advantage in "Extraordinary" Budgets!

City Bank of New York in an article on Federal budgetary
reforms, notes experience of other nations with extra-budgetary
accounting has not been satisfactory and even before World
War I, "capital" and "extraordinary" budgets, separate from

reservation

who

want to balance

ness

Corporation's

Credit

Commodity

price support program separately
from
the
regular operating ac¬

the

those

accounting

December issue of the "Monthly Bank Letter" of the National

be safely ignored.

government to solve

support

anced

not

by inflation.
from any of these

Starting
terests

Government.

interested that savings

pension

be diluted

protective func¬

interest

financial
am

operations

Authorities,

well

Our people

balance

too.

instrument

bring about informed collabo¬
ration among the fiscal,
monetary
and lending agencies of the Fed¬
eral Government.

sense.

interested in them,

sources

derived

are

would also be in the national wel¬
am

the

financial

Federal

would

present

invest¬

policy.

fare.

And I

powerful

type

from

comes

slightly techni¬

This powerful instrument of fis¬
cal policy requires explicit coordi¬

nestly

But I

capital

variations

could

selective excises could be removed
under

specifically,

cases

from which the funds

that

that,

banks, savings insti¬
the public. The differ¬

recognized

ments.

overstated

from

comes

borrowings from

many

dollar.

stated

answer

would be that the borrowings
would
be associated in
general,

excises, and
since the particular hearings at
which my
testimony was given
were
on
the subject of selective
excises, I started from that point.
budget

today, that is,

cal¬

manner

cause

Reform.

discriminatory

selective excises in

The

ence

closure back 21 years,

days

Mills,

Glass,

and

Another

that the money will come from the
same

can

Money?

for the capital items to be

pay

commercial

The

the

excluded from the budget and for
the investment needs of the vari¬
ous

and method.

Really

speedometer

The question will occur to many
—where will the money come from
to

certain

budgetary

bring

Senator

Means

that

words,

own

construction

and

(2167)

Spring

will

members

Exchange.

become

the

New

York

Stock

r>
*

The Commercial and Financial Chronicle.. .Thursday,

(2168)

December 3, 1953

Indiana Toll Road

Financing Near
$280

Million

be offered
wide

issue

group

expected to

Dec. 17.

Nation¬

dealers

460

participate.
Details of one of the largest
public offerings of toll road bonds
on

record—$280,000,000
Toll

ana

Indi¬

Commission

Road

Rev¬

Bonds—were sent

enue

the

Dec.

approximately

460 members
nation-wide underwriting

the

syndicate.
The
offering has been tenta¬
tively set for Thursday, Dec. 17,
and

underwriters

principal

ing

will be

First

serv¬

of the group

co-managers

Smith, Barney & Co.; The

Boston

Corporation; Drexel
Co.; Halsey, Stuart & Co. Inc.;
City Securities Corporation; Collett
&
Company, Incorporated;
Indianapolis Bond & Share Cor&

t i

p o r a

and

o n

Raffensperger,

Hughes & Co., Inc.
Proceeds

from

the

sale

the

bonds

will be applied toward the
construction
of
the
East-West
Toll

winning team of

seven great

divisions

Road, the first project to be

undertaken

the

Indiana

Toll

Road

Commission; together with
financing and other related costs.
The bonds and

interest

payable

them do not constitute

ligation
of

the

ob¬

Indiana'

its

political

subdi¬

are

payable

solely

any

visions,
from

State

but

earned by the Toll

revenues

in accordance
with
Agreement
between

Road,
Trust

Indiana

Road

the
the

Commission

Toll

and the Indiana National Bank of

Indianapolis,
chants

trustee, and Mer¬

National

Bank

Trust

Company of Indianapolis, as co¬
trustee. In the opinion of counsel,
interest

the

from

bonds

exempt

Federal

present

income

taxes.

The

East-West

Toll

will

Road

approximately 156
length and will extend

miles
across

v.;

in
the

>i..

northern part of Indiana in a gen¬
eral

easterly

western

direction

terminus at

from

viding

connections

with

Routes

20,

and

Indiana-Illinois

State

the

point pro¬

line

■f.y

i
#

the

and

the

GREAT LAKES STEEL

boundary line between the cities
of

Chicago,

Ind., to

111.,

line

terminus

under

with

area.

Its complete

Detroit, Michigan,

facilities, from blast furnaces and coke

ovens

through

wide range

and

finishing mills, enable Great Lakes Steel to furnish

of industries with

large volume and variety of standard

special steels, including the famous N-A-X High-Tensile steel.

the

Ohio

|:
#?

western

Turnpike

the

highway

four-lane

modern

ex¬

type construction is

pressway

construction.

Construction
divided

industrial

steel maker in that important

connection at the Indi¬

ana-Ohio

now

Hammond,

and

CORPORATION—Located

this unit of National Steel is the biggest

•
4

ex¬

pected to start in the fall of 1954,
and it

is expected

traffic

late

mated,

ing

projects

total

5,290
use

that

12,371

full

vehicles, consist¬

passenger

daily

usage

vehicle

miles

about

travel,

length.

the

miles

the

have

2,000,000with the

approximately

basis

For the

operations,

expected

trip

daily.

average

and

cars

vehicles,-.: will

Road

year

Toll'Road

of 1956-1957

commercial

the Toll

first

esti¬

traffic

probable

of 17,66k

ing of

the basis of engineer¬

and revenues,
a

to be open for

1956.

113

toll

proposed

charges applied to the anticipated
traffic

for

using the road in its first

of operation, gross revenues

year

the

been

year

estimated

ending
at

1957,

have

$16,340,000.

Thomas Inv. Co. Formed
INDIANAPOLIS,
F.

Thomas

curities

Ind.—Adolph

engaging

business

under

in
the

se¬

firm

name

of Thomas Investment Com¬

pany,

from offices at 3045 North

Pennsylvania Street.

WEIRTON STEEL COMPANY—Here

is the world's largest

manufacturer of tin plate, with mills at

independent

Weirton, West Virginia, and

Steubenville, Ohio. A pioneer in the electrolytic process of coating

steel, Weirton operates the world's largest and fastest electrolytic
plating lines. An extensive variety of other steel products is
factured in plants

that

are among

the

most

manu¬

modern in the industry.

Volume 178

Number 5278

...

The Commercial and Financial Chronicle

(2169)
*

Smith, Barney ft Co.
Celebrates 80 Years
Smith, Barney & Co., invest¬
ment banking firm, is celebrating
its

80th

Anniversary.

Dec.

1,
1873
Barney

was

on.

Charles

that

D„

opened his of¬
fices in Phila¬

delphia

a s

private

and securi¬

7ew industries

require the tremendous

America

material

ties broker.

reserves

Mr. Barney

operating facilities that

7or

raw

are essential in steelmaking.
amply assured of this indispensable
metal, the nation's steel companies must provide for the

iistant future
[n

building for

followed
and its

well

Cooke

among

in the world. This year,

riod.

the largest and

annual

grandson of Jay Cooke.

increase of

tons—an

In 1938 Charles D.
Barney & Co..
merged with Edward B. Smith 8c

since the end of World War II.

[ere, then, is National Steel-—a
to

team

seven

great

divisions

produce highest quality products.

Completely integrated, entirely independent, National is
)ne

of America's

most

progressive steel producers.

Harding

since
1941,
Charles B. Harding1
senior partner
of Smith, Barney & Co. is a
great

modern

most

pe¬

Charles

STRAN-STEEL

>erfectly coordinated

fi¬

Civil War

consistently

National Steel will achieve

steelmaking capacity of 6,000,000
than 50 per cent

the

—

nancier of the

program

are

son-

of Jay

eminent

designed to keep its capacity
products in step with the nation. Its mines, ships,

furnaces and mills

tore

in-law

today.

tomorrow, National Steel has

long-term

the

was

bank¬

DIVISION—A

unit

of Great

Lakes

Steel, with plants at

Co.

1933

the

of the officers

many

Ecorse, Michigan, and Terre Haute, Indiana. Originator and exclusive

manufacturer of the famous Quonset

Edward B. Smith & Co.

include Stran-Steel

buildings. Other principal products

of the

Long-Span buildings, Stran-Steel mailable framing for

the building industry and

Guaranty

Co.

had
as

joined
result

Banking Act of 1933, which

caused

Stran-Steel flooring .for trucks and truck, trailers.

the

Guaranty Trust Com-

dissolve

pany

its

y^.,

•..*

investment

banking affiliate.
Today Smith, Barney & Co. is
one of the largest in¬
banking
firms
doing

considered
vestment
both

underwriting and

securities business

the

New

York

general

members of

Exchange
other leading exchanges. Of-

and

fices

are

cities

with

Wall

*
,

Street,

long

maintained
the

main

seven

office

New York. While
leader in corporate under¬

writing Smith, Barney & Co. has
developed as an important house
in the municipal bond
business.

same
■

Stock

the

last

the

financial advisor

New

Jersey Turnpike Au¬
and will shortly manage

thority
the

Smith, Barney &;

year

Co. has served

$280,000,000 issue of the

diana

Turnpike

In¬

Commission.

.jC
HANNA

IRON

and mines in

ORE

COMPANY,

Cleveland, Ohio—Iron

ore

properties

Minnesota, Wisconsin and Michigan. In addition, National

Ste^l is participating in the development of the important new iron ore
field in Labrador-Quebec, where great iron ore reserves will augment the
future supply of this vital raw

material—the basic ingredient of steel.

THE HANNA Fl'RNACE CORPORATION—Blast

Steel located in
iron

furnace division of National

Buffalo, New York. Its four furnaces

augment

Virginia Electric ft

the pig

Power Slock Offered

production of National Steel's eight other blast furnaces in Detroit,

Michigan, and in Weirton, West Virginia. In addition, this division is
a

leading producer of all grades of merchant pig'iron for foundry use.

Merrill
&

Lynch,

Beane and

(Dec.

Pierce,

Fenner

associates yesterday

offered

558,946

$10

Virginia Electric & Power Co.
$27.15 per share.
The group

value

par

award

won

petitive

sale

the stock

Tuesday

stock

common

com¬

its

bid of $26,639 per share.
Proceeds

JStHH
vitWmsBm

reimburse

psj
[mm
1 *

from the sale

the

treasury

therefor.

In the five years 1948-52 the com¬

expended

pany

additions

and

$186,000,000
improvements

its property.

Of this amount $48,000,000 was expended
in
1952.
Construction expenditures for

!i^

1953

estimated at $42,000,000,

are

which

present expectation is for expenditures in

1954 of

the extent

CORPORATION—Coal mines and properties in Pennsyl¬

vania, West Virginia and Kentucky,
National's needs. Resources have been

supplying metallurgical coal for

further expanded by acquisition of a

substantial interest in. twq large mining

operations in the Pittsburgh

area.

NATIONAL

STEEL

PRODUCTS

COMPANY,

Houston, Texas—One of the

foremost steel distributors in the Southwest, serving a seven-state area.
The

will

huge plant and warehouse—a Quonset structure fabricated by the

Stran-Steel

Division-—provides five

acres

of floor

space

under

one

roof.

Virginia
is

ginia.
gas

GRANT

PITTSBURGH,

BUILDING

PA.

INDEPENDENT

COMPANY

OWNED

THAN

19,000

also

Co.

;

operating in

Power

parts of

West

and

distributes

Norfolk

served

gov-

Virginia and in

News.

time.

Electric &

Carolina

North

CORPORATION

will

electric utility

most

NATIONAL STEEL

out

Vir¬

natural

Newport

and

Population of the territory
is

estimated

2,300,000.

STOCKHOLDERS
With Johnson, Lane, Space
(Special

The Financial Chronicle)

SAVANNAH,

Ga.

—

Isaac

Aiken, Jr. has become associated

wifth Johnson, Lane, Space & Co.,
Inc., Bay
was

Drayton Streets.

formerly

with

program

conditions at the

•

$45,000,000, but

to which this

carried

erned

$31,900,000 had
been ;
through Sept. 30. The *

expended

NATIONAL MINES

of these;

shares will be used to provide for
construction
expenditures or to

the

Citizens

and Southern National Bank.

The Corrnnercial and Financial Chronicle...
26

Prosperous

We Must Have Both

savings.
They mean, by virtue of cheaper

National Security

Economy and

grief to many homes and in¬
heavy current expendi¬

and

ings—savings for individual fam¬
ilies and savings that mean jobs—
jobs in factories, jobs in mills,
jobs in mines and power plants
that cannot be built without such

Continued, from page

volving

costs

local

and

state

govern¬

ments, new opportunities to build
Inheritance in Field of Taxation
schools, the highways, the hospi¬
tals which are so vital a part of
Our inheritance in the field of
the strength of our whole nation.
taxation is a staggering one.

government.
This Administration is reduc¬
It is staggering because
of its
debt is now prac¬
ing taxes. Because we have re¬
tically at the limit of $275 billion. size, due to inherited obligations duced
expenses and only because
In addition to inheriting a debt of and the deficit financing of recent
we have made these reductions in
enormous size,
we also inherited years.
spending, the excess profits tax
In 17 of the 20 fiscal years from
a debt that had been badly man¬
will expire on Dec. 31 and in¬
aged,
nearly three-quarters
of 1933 to 1952, the government op¬ dividual income taxes will go
which matures within less than erated with a deficit. Conversely,
down an average of 10% at the
five years or is redeemable at the in only three of those 20 years
same
time.
Let no one be de¬
did the government live within its
holder's option with too large a
for our

tures

The

public

ceived.

proportion in the hands of banks
rather than distributed to longinvestors.

term

Both

conditions

these

were

deliberately planned by our prede¬
cessors and affect
the supply of

inflationary. They
to cheapening
the value of the dollar which fell
from 100 cents in 1939 to 52 cents
at the present time.
Ironically
enough,
this same
policy which produced inflation
and devalued the dollar resulted
in our paying so much more for
what we bought that we now have
much more total debt to pay than
would otherwise have been the
credit. They are

contributed

have

income.

centive

Restrictive

Too

The debt limit is a

which

heritance

great

and

vigorous

free

economy.

addition to and overshadow¬

ing all else was the grim conflict
in
Korea,
taking the lives of

stalemate that
dragging
endlessly,

American boys in a
been

had

but

hopelessly,

lessly,

blood-

from

far

and on for nearly three

horrible years for almost
home in this land. The fi¬

long
every

burden

deficit

debt,

financial in¬

gives

initiative

deter

and

development

piling
Limit

Debt

in¬

inhibit growth and

program,

and

deficit, debt on
tax, built up

tax

alone

Korea

reduction

tax

could

planned

ever

also staggering because

inequalities and deliberately re¬
strictive provisions, which, in ad¬
dition to the very size of the tax

nancial

case.

when¬

justified

Additional

by all and is essential to the
continued growth of our economy.
The
accomplishment of sound
money will
protect the savings,
pensions and incomes of the old,
while supplying the tools of pro¬
duction
by
stimulating
invest¬
ment creating new and better jobs
but this nation, as the land of op¬
portunity for the 'young — eager
ambitious to better

for work and

themselves—cannot

long

endure

such under the restrictive taxes

which

inherited.

Taxes

further

can

reduced

only

consistent

with

quate to meet the dangers which

come.

maintaining

defense ade¬

bloodshed
in confront us.
All
these
economic measures,
quire the payment of the great Korea are ended, at least for the
bulk of corporation taxes in the time being, and the tension in the finally, mean speeding
the day
successive
further
reduc¬
first half of the calendar year. homes throughout America is les¬ when
sened. In its place our every effort tions in taxes following one upon
This disproportionately larger col¬
lection of

taxes

by the

used

was

Shooting

and

work

fashion

lasting,

and

sound

struction in that war-torn land. It

one

year.

This

the

forced

of is¬

practice

suing tax anticipation bills in the
fall when tax collections were low

and

Administration to sub¬
stantially reduce a budget deficit
previous

for

come

de¬

of it

fervent hope that out

our

may

peace,

reconstruction

substitute

equitable

matically
rowing

bor¬

increased

forces

at least a six-month

over

period. This fixed inheritance has
made the present debt limit too

These, then,

inheritances
the

government's door¬

moved in last Janu¬

office,

step when

billion

Administration

three

$81
the
one

previously

years

from

for

be delivered this year,
next year, and even the year after
to

goods

m—all

when de¬

paid for

without

livered,

providing

any

for the payment.

money

This $81

billion-legacy without

provision
creates

its

for

payment

now

most burdensome factor

in raising cash to pay the govern¬
ment's bills. These C. O. D. orders

must,

course,

addition

all

paid

the

for

current

of the government.

penses

the

increase

in
ex¬

They

problem of the

debt

limit

as well as the
difficulty of
balancing the budget quickly.

A habit of extravagance in some

government

agencies

burden

the

part

the

financial

our

well

Others

run.

habits

quired

in¬

have

ac¬

extravagance

over

the past 20 years of free and

easy

spending.

This
mined

ing.

Administration
to

cut

deter¬

careless

out

spend¬

are
trying to develop
dollar-consciousness on the

part of all government employees,
both
our

and

out

uniform.

All

efforts in cutting out extrava¬

gance

are

knowledge

based

that

every

government spends
some

mysterious

the

pool

simple

dollar the

comes

not from

wealth

but from the toil and savings of
American
and

expect

citizens
a

full

who

deserve

dollar's

worth

for every dollar taken from them

support Jheir government.

the burdens and

were

financial facts

hard

American

the

people

ment

Govern¬

Federal
a

simple

single,

give the American
American money,

purpose:

honest

people
the

the

serve

kind

dollar

dollar's worth

that

buys

This has
not been done by oratory nor has
it been done by magic.
It has
only been done by tireless atten¬
tion

pense

goods.

reduction

detailed

ex¬

department of the

every

government.
This action depends upon three

things

sound

budget

policy,

Federal

Reserve

System

—

sound

and sound

debt

management.

have, in the first instance,

Private

believes

American
the

than

for him.

can

—

can

government

Competitive

terprise, free initiative—the
age to

take

chance—the

en¬

cour¬

oppor¬

System to use its power to
provide a supply of credit that

serve

those

natural demand
excesses

inflation
We

and

avoids

encouraging either

deflation.

have

meeting the
problem of debt management by
offering the first marketable longbegun

measures are

permit.

not the

These

concern

160

million Americans, each for him¬
self striving to improve his lot,
advance his

children, and improve
the position
of each succeeding
generation, that all taken together

has been

things for

to create

power

people, for higher

They
ual and
mean

are

our

end

lar

that, with slow deceit, cheats
every family of the
purchasing
power

of clothes

They

their
and

mean

income

and

even

remind

vital

the

America

curity of America.
is

need,

tial

raw

Africa
If

Europe.

instantly

can

and

are

others — we
how others, less

upon
see

must depend
upon
us,
trade and markets, for

strong,

our

their

economic

health

and

And

this truth

dare

cannot survive

dom

allies

need

the

menace

can

freedom

any

home,

any

for

them

industry,
family

any

in America.

mass

In
eral

massive

For America's

power

potential

and

meas¬

American

production.

These truths
A

Latest

munist

surely

issue

the

stability

serve

American
the

Com¬

almost fatal blow

and

sav¬

Second: The

what

confident.

feeble

falter¬

believe.

For

ultimately in the bound-""

unmatched

resource

world.
not

this

We believe in his capacity

only to dream

—but

wake, to
that dream

bring

good dream

work,
to

and

life.

true

Confident, truthful, steadfast:
These

are

the marks

must offer.

of the

lead¬

Only

such leadership can cre¬
lasting security for America.
Only such security can make

ate

the

peace

but

such

time

century
must

not

prayer

Serving so just a cause
spirit, now—as in that

seek

fact.

cannot

ago—we

succeed.

credit risks of "would be proprietors."

poor

than all the credit the government
could

create,

concluded

"The

Guaranty Survey" in its editorial,
"What Does Small Business
Need?"

which

cember issue.

features

Really

the

The editorial

De¬
com¬

the role of the

new

Administration.

small

the view that the problems
business

primarily
financial. ' This
view
conforms with experience.
Every credit man knows that the

managerial,

are

not

business world is full of would-be
borrowers
as

who

solution

when

their

seek
to

real

their

credit

problems

difficulties

and toward whom he has
sonal

lie

credit

record

from

came

experience

applicants with

successful

and

little

business

prospect

security

worth of

our

mil¬

per¬

feeting.

"The
small

perennial

business

complaint

quate credit facilities

that

find

cannot

ade¬

reflec¬

tion of the obvious fact that there

would-be

are

than

there is

that
not

"The SBA based its original pol¬

many

credit

poor

destined

proprietors

for. and

room

survive.

hence

risks

are

Despite

this

fact, and despite the complants of lack of credit, it is for¬
that

tunate!

whole

account

business

small

continues

give

good

itself."

Available

evidence

does

not

support the contention that pres¬
ent credit facilities for small busi¬
ness

ago

inadequate, declared the

are

bank

publication.

"Three

years

the American Bankers Asso¬

ciation

made

survey
which
representative sam¬
ple of 3,200 large and small banks

showed that

—about

the

one

out

country—had

every

five in

than

5,-

500,000 loans outstanding, with
per

loan.

Shortly

than $2,500

average amount of less

thereafter

the

National Association of Manufac¬
turers

circulated

which

revealed

that

questionnaire
the greatest

need of small

business from gov¬

vey."

ernment

not

his

for

"He is risking his own or
depositors' money. The pen¬

alty of failure falls upon himself
or

upon

those to

4^hom

he feels

of direct personal
He cannot afford to

strong sense

obligation.
sev¬

of
conquest
as
military disaster

any

(^"Guaranty Survey," monthly publication of

helpful to small business

fail.

tion

was

tax

relief.

that

ness

and

the

government

choose

enters
situa¬

The*,, incentive

exists.

rightly between the sound

credit

for

About

but

37%

said

the

government could help
by revising the tax laws so as to
lighten the burden on small busi¬
encourage

funds

are:

crippled

dream
as

and would be

correction.

must

Guaranty Trusi Company of New York, holds private credit
agencies as cajpable in extending credits to small business, and
lays complaint that credit facilities to small business are inade¬

"When

would

economy

in¬

too

accepting

Wage Relief, Not Government
CreditHHeld Best Aid to Small Business

the credit field, a different
First:

and

above

prove

less courage and industry and in¬
genuity of the free American—as

fail,

self-evident.

are

fear

must

honest

cannot

believe

Tax and

perfecting this defense,
truths

true

and

reason

too

ing in

vacuum;

friends—and

and

threat

farm,

any

truthful,

criticism.

have learned

forget: Our free¬

never

performance

our

ership

own

welfare.

and

have

ourselves

in our vast strength,

dependent

essen¬

materials from Asia

We can

performance

our

abroad.

slogan.

ideals.

our

solve

pretend to
a

than

must

We
to

And

less urgently,

for

criticism

productive

steadfast.

office.

industries

and

we,

less

television

all need

this gov¬
worthy

and

principle for political
We
must
always

telligent

—

"The

defense against any enemy

the

sell

expediency.

are

need markets for

never

problem with

free.

and

is,

farms

our

with

strength

to stay

are

Powerful

again

you

all free nations.

food.

protection for

the world—and

trade

called, to be
of freedom,

cause

Party

must
can

evade

professional credit man or
that all
these measures have as a final, investor is in a favorable position
to perform this (lending) function
ruling purpose—not merely sup¬
because
of his long
experience
plying all our material needs—
and strong incentives to succeed,"
but first, last and all the time
comments
"The
Guaranty Sur¬
they are essential for the very se¬

nation. They

to the
withering of the value of the dol¬
an

We
We

must

shores.

our

earnings.

institutions.
our

children, "it must be

on.

vital to every individ¬

family in
bringing

higher standards of living for elsewhere. As head of the RFC,
all, than ever has been known in Jesse H. Jones found that the
this world before.
great
majority of requests for

sim¬

ply of government statisticians
titanic banking

world's

icy

It is the collective effort of

ureless

rele¬

do not end

Our trade with

the

America

made

have

inven¬

and

great.

conditions

that the economic issues

know

under¬

of America.

self-evident

security—we

have

all
and

ernment—are called to be

final

our

Business

surest

refinancing operations

Small

term loan since 1945; and we shall
continue to extend the maturities

vant

And—

truth

and

policy.

—constructive

itage of

billion.

meets

government,

money

of the

we—this

care

economical
sound

upon

protected and guarded and handed

than

less

assured

concept

America

never

and can be encouraged and
only by honest money,

upon

ments

tion—these

activity must be founded

tunity to better oneself by effort
work

essen¬

demands

Tax relief and labor relief would

ment and

quate to

Administration

vast

our

program

implicit

our

worthy

Fourth: Such industrial employ¬

Enterprise

for himself—if he is allowed

economy

high level of employment and in¬
dustrial activity.

produc¬

We have freed the Federal Re¬

billion

defense

de¬

Opportunity is the rightful her¬

$11

tial

and

reduced the prospective deficit for
the current fiscal year from more

than

to sustain

needed

security.

standing of leadership.
As

kind

The

spending for good times.
More

Clearly
said

the

and I

of peace,

spoken

have spoken of

schedules
weap¬

have

folly.

Third:

that we need never
rely upon defense

have

financial

quickened

prosperity

that the average

Reshaped

fatal

ing goods for better living for all
more

production

would spell spectacular and

ons,

all

These

are

This

Policies

spent,

frozen to produce obsolete

the surest stimulants to

which

We have reshaped the

policies

machinery

America.

heir.

fell

heritance. Some government agen¬
cies perform vital functions and
are

These

ary.

came

found about
orders placed by
it

former
to

Financial

When this Administration

which

financial
found

restrictive.

into

of the

some

were

quicken its demands upon the

productive

This is nothing less than
plainest record of history.

reductions

spending
are
achieved can
allow the consuming community

against expected receipts the fol¬
lowing spring when corporate tax
collections were high, and so auto¬

rapidly

mands

permanent and con¬

settlement.

structive

another

must be
by its cost
by its wisdom—for billions
dollars wastefully or unwisely

upon

expenditures are further
reduced.
And
expenditures can
only

program

simply

not

but

reduction is de¬

tax

sired

itary. defense
measured

meet

otherwise.

commitments to continue for years

A law was passed to re¬

concern.

Thursday, December 3, 1953

(2170)

into

small

Nearly

23%

mental

interference.

flow of
enterprises.

the

wished

nothing ex¬
cept to be left free from govern¬
thought

the

About

government

22%

should

If improve its own financial and ad¬
the direct ministrative operations and amend
the labor laws.
loser on the lending side is the
Only about 9%,
that
the
government
taxpayer,
a
vague
entity with thought
whom the bureaucratic agency of¬ should facilitate loans to business.
ficial has no personal relationship
Only 7% reported that they had

and

the

unsound is largely missing.
choice

wrbng,

Volume 178

;

failed

Number 5278

The Commercial and Financial Chronicle

...

obtain needed funds dur¬

ing the decade
"The

two

1939-49.

burdens
on
small business which it is in the

great

Our

Reporter

government's power to lighten are
the
tax
burden
and
the
labor
burden.
be

made

particular,

less

By JOHN T. CHIPPENDALE, JR.

should

difficult

small

for

Bank and Insurance Stocks

Governments

The

market has

government

The labor laws need to be revised

with

any

firms

to
improve their financial
position and expand their opera¬

plowing back

view

earnings.

small

protecting

enterprises against the demands of
labor organizations which, with
governmental aid and
have

become

much

protection,
larger and

than

powerful

the

enter¬

prises themselves that they
times

hold

the

latter

some¬

their

really important change in

ment market for the

usual

moving out

to the market.

operations
demand

LOUISVILLE, Ky.
Street,

—

the

announces

effective

ment,

There will

Dec.

1953,

Albert

Brocar, Jr.

Manager

their

munici¬

bond

de¬

partment.

inclination

succeeds

rion

well,

Ma¬

partner,
who
developed the
depart ment
has

The

only about $122,000,000 in

in cash.

To be
sure,

Central

1954 which

tion

such

partners of
continue to have

will

municipal and Corporate
derwriting activities.
Mr.

un¬

auspicious

obligations for the

(A1 to his asso¬
been with Hilliard's

has

since

May,

active

1929,

has

and

been

municipal bond work
since January, 1937.
Well known
in

local financial circles

water

—

electric

revenue,

debt

that

rev¬

school revenue or general
obligations. He has likewise had

the

were

for

15,

1958.

sion in

maturity

The

fact

the maturing 2y8%

over

The

of losses

for

This

notes.

the

private

being likely for

Easy

of the

the

some

December

impending

2Vi%

these

wide

experience in over-thetrading, having actively

counter

operated

this

department

Hil¬

(crop

liard's in the 1937-51 period and
having had supervision of the ac¬
tivities

this

that time.

department

since

the municipal department, he will
continue
supervision of trading

the

and

handling of his many
in all types of invest¬

customers

business.

ment

Vice

Bond

line

the

one

market

loans),
with

$600,000,000

"certificates

the original
of

interest"

condition

interest"

have

not

opinion of

Street, New York City, members

be will

which

ment.

its

was

with

factors

the

Premiums

low

Losses

E. E, Charleston

the time

Dec.

money

associated
404
of

means

15,

the

easy

and

1958,

with

Chronicle)

Calif.—

has

become
&

Barth

the

San

Francisco

Stock

Charleston

was

and

Exchanges.
formerly

in Davies & Co4,

Pacific Indemnity

1053

1052

52,173,294 46,331,156

20,479,352 20,627,417

25,465,844 22,962,451

Earned

rate

2J/2%.

11,575,196 14,194,732
7,282,861

4,699,518

7,036,072

1,621,295

22,007,932 20,569,214

Exp

-603,387

2,799,491

2%%

demnity

place in the

markets will

effect

and

balance

with

the

of premium

This

Pacific In¬

year.

in the automobile

have

rates

the automobile lines have been very

years,

however,

year,

enabled

better loss experience

companies

improved underwriting experience.

fraction of its business in

business is

The main

writes

single line—fire—

largest

volume last
a

allowance

make

Glens Falls

physical damage and property damage.

past two

unprofitable.

"certificates

earlier periods have been converted to

this field

and

show

result the losses of

underwriting gains.

absorbed

Glens

that this offering

the

upon

the

money

kept in good

insurance

the other hand has only

lines of liability,

used
be

underwriting lines.

straight fire insurance.

banks

can

appears

line

should

two companies

of the

differences

accounting for 23.5%

The

the

diversified

Corporation.

Credit Ease

government

Falls

representing to

will
fire

the

security

Expected

and

casualty

field

extent

some

has

Fire

underwriting.

specialists that the

been

lines,

able

however,

cross

section

show

greater

not

account

are

not

into

this will

and

the

extended

new

easy

there is

Co.,

New

Mr.
part¬

have

the

side like it has

rates

ease

the

been.

firming

are

money

unless the

Ma¬
going

and

with

good effect

substantial

15,

amount

1958, would not

likely take
tion,

there

onfy

too

happy about things and would

and this would

by^the Treasury

There appears to be

very

make

the

LOS

Dec.

liam

most

trends,

casualty

Varney

West Sixth

—

Bulletin Available

With E. F. Hutton Co.

extending of

(Special

to excess reserve

to The

Financial Chronicle)

LOS ANGELES,
C.

Huber

with

South

has

Calif.—Richard

become

Hutton

affiliated

Company,

623

there will

the turn of the

new

Hew York

Street.

previously with William R. Staats

after

im¬

Guaranty Trust Go.

Wil¬

In addi¬

considerable talk about the future course

be sometime

of under¬

showing substantial

been added
& Co., Inc.,

that

will

group

Chronicle)

Financial

ANGELES, Calif.

requirementsv-It is the opinion of most money market specialists
it

current indications

underwriting earnings for the current year
the

has
the staff of Blyth

215

difficult, if not almost impossible.

of the prime bank rate and what might happen

companies in

(Special'to The

wgpld be many others that would return to the li¬

quidity preference idea
maturities

these

Blyth Adds to Staff

the

Those

the 2V2S of

short-term issues in future refundings.

basis

generally favorable
with

1958, it would not

of the; December 2x/8s that went out into

the

writing results and barring a major storm or fire, we would expect

15,

doubtful that the

underwriting experience would be so favorable.

now

the government security market.

upon

words, with companies having

provement over those of 1952.

noticeable firming in interest rates

In other

greater percentage of straight fire lines, it is

markets and

indicating that this trend will continue.

refunding

This is believed to account,

of the other groups.

some

part, for the favorable showing made by the company

first nine months.

in the
a

2V2S,

especially

be accomplished

not

when

which

securities

hands,

strong

percentage of premium volume in the case of Glens

The recent refunding

conditions.

money

at least in

that

powers

great

Fails

credit tightens and >vhile

market will be kept on an even

money

put

market is kept

with prospects

Montgomery Street, members

York

ner

Charleston

paper

Credit

money

market

money

higher but only when

have

With J. Barfh & Go.

Ernest

issued

been

21,364,365 20,892,630

Underwriting Gain.

Credit

with

made of the

the year when

to it that

absorbed

Owners

Financial

recently

have

55,917,481 51,175,420

Incurred

Underwriting

that

of $360,000,000

rate

this

21/ss being swopped for the 2Vzs due Dec.

The

Written

Comparisons

was

has brought into existence

operation

turities

department

FRANCISCO,

which

reports

stability

If there should

evidence

some

existing conditions barring

Glens Falls Insurance

for

right after the

(Special

indicative of final earnings,

the only

are

interest"

with

offering

the

Tucker. Anthony & Co.

SAN

taken

underwriting

whole.

depart¬

formerly in the in¬

sales

stitutional

with

associated

institutional

ex¬

seems

Commodity

offering

lower'rate

appreciable

Exchange,
due

become

the

for

these "certificates of interest" will

many

see

S. Johnston

that James

announce

sale

Commodity

that

Wall

necessarily

con¬

firming in rates has been reported here and there it is the

some

Co.,

of the New York Stock

the

any

not

Continued

keel
Walker

The

original

that

Club of Louisville.

Adds J. S. Johnston

firm

respect to particular companies

the

G. H. Walker Go.

has

the

believed

This is

the

theHMay in which they should

market

President

through

deficit.

since

large element of risk, and the extent

incidence with

covering the results for the first nine months of the current period.

CCC Certificates

the improvement which has taken

with

addition to heading

the

their

bought.

"certificates

obtained

meet

business with

With these reservations in mind it is interesting to review two

The extension

come.

mainly will provide the Treasury with funds that
to

into the hundreds of millions

amount of the disaster not being determined

of what the final results may be under

enue,

money

show¬

"Loss

sale

compares

same

other

one

the experience in 1950 when the Novem¬

was

losses running

A single storm, fire

major catastrophes.

ex¬

2y8s

market

money

time to

conditions is

money

Lower Rate

Corporation

generally not advisable to project

otherwise profitable period into

under¬

year.

they do show the trends in operation and provide

usually takes place when the liquidity preference is

securities that should

consolidated

groups,

1053

helps to dispel the belief that short-term maturities

The

turn

so.

owners

growing confidence

wane.

line

Nine Months to September 30th

is possible to

that

interest rates

multiple

policy of the Administration to push out maturi¬

changed 60% of their securities for the longer maturity
indicate

are

lower

show

Thus while interim operating results of particular companies

exten¬

was

will

particular period is subject to rather sharp changes.

balance of

was an

can

piled

writing is

The $1,750,000,000

1958,

Expectations

lines

fire

than six months.

opera¬

were

After all it must be remembered that fire and casualty under¬

being offered, with
that

large

of dollars, the total

being paid off

$2,930,000,000

converted into the 2y2s due Dec. 15,

were

storm

should

securities

new

the

large loss. This

successful deal,

very

$1,180,000,000 took the l7/8s due Dec. 15, 1954.

"Municipal

man,"
he
has
had
wide experience in the develop¬
ment, setting up and selling of
all types of municipal obligations

ing

one.

changed going into the 2Vzs due Dec.

being

the Dec. 1 maturity, the

owner of

approximately $1,750,000,000 of

of maturities

Brocar

ciates)

the matured

the largest

the

direct interest

was

For

catastrophe

However, the other holders of the 2y8s turned in 96% of their

firm,

the

1958

helped very much to make the big refunding

ties whenever it

primarily

In the insurance field it is

Banks, turned in all of their notes for the l%s due Dec. 15,

Mr.

Cardwell,

four

showing

are

writing

estimate operating results ahead.

ber

with

tinuation of the

9 2 5.

gains.

good
increased

getting

companies.

insurance

casualty

writing results should be close to those of last

long.

the 2V2S due Dec. 15,

since

one

also

remaining in the current calendar

underwriting earnings while casualty companies will report large

refunding of the December 2V8s into the l7/8s due Dec. 15,

Brocar, Jr.

maturities

and

actively
C.

distant

1954

su¬

pervised

Albert

most

and

institutions

of these

issues have been

Card-

Hilliard

and

intermediate-term

to go

now

that

Refunding Details Reflect Investor Confidence

pal

the

great deal

attention from institutional investors who

appoint¬

major fire

supply considerable volume

doubt be

month

one

interest is mounting in the earnings to be realized by the

year,

govern¬

into the year end.

as we move

with

Insurance Stocks

—

•

With less than

but also for the purpose of

purposes

and

maturities,.continue

The short and

Hilliard & Son 419 West Jefferson

the current tone of the

This Week
i

balance of

backing

Switches, not only for tax

mercy."'

Brocar Heads Dept.
For J. J, B. Hilliard

gone

the year. There will most likely
filling with a good demand keeping
prices pretty much within the limits that have been prevailing.
the

E. JOHNSON

By H.

along with the refunding
operation in the expected way, with investors showing their con¬
fidence in the policies of the
monetary authorities by taking a
good bundle of the longer maturity which was offered to the
holders of the 2Vb% notes. It is believed that there will not be

tions

(2171)

year

before

beiany developments of importance in'these two items.

& Co.

Laird, Bissell & Meeds
York Stock Exchange

Members

New

Members

American

120

BROADWAY,

Telephone:
Bell

Spring Street. He was
(L.

Stock

Teletype—NY

Gibbs,

Exchange

NEW YORK 5, N. Y.

BArclay

1-3500

1-1248-49

Manager Trading Dept.)

Specialists in Bank Stocks

•

The Commercial and Financial Chronicle...
28

It has put
capacity than
in any 12 months' period in the
nation's history. It has produced a
vast quantity of goods for foreign
aid.
It has produced more mili¬
tary weapons by far than in any
prior peacetime year. And it is of
the highest
significance that in
the creation of a climate for free doing all of these things simul¬
enterprise which will insure the taneously our economy has made
full use of our new technology in a truly spectacular record of pro¬
still another

Continued jrom

first page

place

new

high.

new

Shape ol Economic
Things to Come
tumble us into a
the circumstances it

might
Under

slump.
is not

surprising that there is a good
deal of disagreement among busi¬
ness observers as to the outlook.
It

is,

made

any

ap¬

praisal of the outlook for the fact
that in the past
12 months we
have
witnessed
several
deeply
significant and
developments.

highly

favorable

First, of course, is the evidence
serious

posed
Utopia.

the

behind

weakness

to be a depression-proof
But the area within the
orbit

Communist

the

midst

radical

their

taxes,

Fourth,
justment

money

still

into

further

when

the time
on our

the

economy can

Second

the

statesmanlike

efforts

the substitution

the

factor in

our

ration

program

and

our

out

new
new

providing

for

of confidence for
chief

stimulative

the prepa¬
anti-depression

economy,
new

carve

program

inflation

be reduced.

businesslike

Administration to
economic

drain

defense

depending

the stimuli

a sort of rolling read¬
has removed some po¬

the

business volume.

markets

have shaken

artificialities of the

riod of arbitrarily

declined in

supplies.
tion in

The

off

long pe¬

enforced cheap

Agricultural prices have

money.

hasten to

the face of increasing

The post-Korean infla¬
number of the individual

our

and

consider what could

pen

dence

dictates

dividuals,
and

the

a new

government

hap¬

repeat

were

circumstances
that

pru¬

everyone—in¬

associations

business,

government—do

bit of

commodity prices has been elim¬ post-boom planning. Future events
inated.
In several
industries may, to be sure, make such plan¬
retrenchment has been the order ning unnecessary. If enough of us
of the day.

did

Fifth, the nation has in the past
year made a most impressive ex¬
hibition of economic power.
Our
business has produced and
sold

boom

goods—in dollar as well as
physical terms—to civilian con¬

sumers

lifted

than

its

ever

before.

has

productive efficiency to

realistic

very

job

planning it might

post-

spare

nation from any setback at all.

the
In

event, such planning might en¬
able us to avoid having to run for

any

the

our

the

Under

weather

history

itself.

through full inflation," and

the

cloud

matter

dedication

that all

reassure us

not

government

instead

just "full employment

very

how determined
is to prevent a
slump, it is just good common
sense to take nothing for granted
sky,

of tax reduction and sound money

with

well

are

storm

cellar

were

the

turn

and, furthermore show
can

productively

Background for Tomorrow

use

business to

economic-

against

how

any

setback

opment
cient

step up the devel¬

markets,

new

investment

crease

equipment, to

in¬

effi¬

develop

capacity and to strengthen

new

our or¬

ganizations.
whatever

But

concern

feel with respect to

there

outlook,

one

may

the short-term
no
reason
to

that the

doubt

long-range future

been

the

But

overwhelmingly im¬
is that, despite the
booms
and
busts, the inflations
and deflations, our economy has
rolled up for the

period as a whole
splendid record of progress and
It has produced

achievement.

vided

Statistical

support

for

optimistic view of
long-range future is provided

unqualifiedly
our

charts

two

which

like to draw your

should

attention.

standard

of living

the

than has been
other country in
the world. Despite the instability
case

first

for

chart,

any

from

fluctuations

and

been

The

goods and services and pro¬
a
more
rapid rise in our

month

Background for Tomorrow

fact

portant

prog¬

lot.

our

spectacular expansion

and

drastic and discouraging
Price stability has not

past

deflations.

of the U. S. is to be one of really

ress.

favorable de¬
velopments.
But we know from
experience that there is an everpresent danger of a setback after
the longest and in some respects
the most pronounced boom in our
history. No matter how strong the
situation may seem to be, no mat¬
ter how many distinguished citi¬
zens

tentially dangerous sources of im¬
balance without a general con¬

upheaval and a social rev¬
which pushes the danger
war

govern¬

direction of sound money.

litical

all-out

labor

abandoned
the
straitjacket controls so dear to
Socialism and moved firmly in the
reduced

traction

the future and brings much closer

number of others have

ments.

economic depression, a po¬

olution

countries. Sev¬
have thrown off

countries

eral

ductive accomplishment.
These

the resurgence of con¬

Third is

and

;

servatism in many

Communism is sup¬

Iron Curtain.

productivity

expanding our
production.

our

that

important

however,

allowance

Thursday, December 3, 1953

(2172)

and

month

to year

year

has

ours

land of opportunity for the

the
farsighted
and
well-managed businesses of
the country.
courageous,

"Background

Tomorrow," pictures the sali¬
concerning our

the

ent economic facts
economy

for pointing out was the
when the bank of the Man¬
Company first opened its

give

year

hattan

business.

for

doors

Potentials for Tomorrow

through the period since

1799, which a am sure you will for¬

shows that

This

has been

ours

chart
an econ¬

chart, "Potentials for
Tomorrow," describes, roughly,
the statistical objectives which it
should be
realize.
sweep

of booms and busts. We have
experienced alternating periods of
prosperity and depression with
quite a large number of specula¬

tive

tical

omy

booms

always

followed

assortment of
financial panics and quite a large
big depressions,
number

"little"

booms

and

economy

and

merciless

weak

have

those

who

become

are

overex¬

tended.

the middle section of the chart

shows, been marked by
of

minor

inflations

and

few

number

spectacular

always followed in the

concern

the

shows

upward

during the past 50 years
population, in our produc¬

per capita and
production. Here we

total
how, de¬

our

see

spite depressions, inflations, poli¬
changes

benefited

and

from

wars

the

population

rising

have

of
increasing

leverage

and

productivity.

•

have

Trends

been

drawn

through the record of the past and
been extended through the

have
next

quarter century. Such trend

projections

Furthermore, our economy has,
as

our

constant

our

tion

"little" depressions.

Ours has been
of instability—rugged

The other

that

show

our

growth in population and our pro¬

gress '
were

future

productivity

increasing
be

than

has

in the past our

rapid in the

been

the

case

population in 1977

Potentials for Tomorrow
K the FULL POTENTIALITIES of
TECHNOLOGY

art

realized

CONTINUED POPULATION GROWTH
230 MILLIONS
157 MILLIONS

220MILLIONS

76 MILLIONS

AND FULL USE OF TECHNOLOGY TO RAISE PRODUCTIVITY

AND OF INFLATION AND DEFLATION
13600

$3,300^>

IN 1952 DOLLARS
WAR BETWEEN

THE STATES

$2,900
20OO

I too

PRODUCTION PER CAPIT

BUT A SPLENDID PERIOD OF GROWTH AND ACHIEVEMENT
lOOO

1935-39-100
RATIO SCALE

CAN LIFT PRODUCTION TO FABULOUS LEVELS
>

*■

5750 BILLIONS

$625 BILLIONS

VALUE OF TOTAL PRODUCTION
Ratio Scales

^INDUSTRIAL

PRODUCTIONS

$99 BILLIONS

visual
comparison of
rates of growth
permit

Volume 178

Number 5278

The Commercial and Financial Chronicle

...

(2173)
would

220

millions,

our

Economic Prerequisites for

pro¬

duction per capita would rise from

$2,100
the

capita

per

value

would

lion

show

$2,900,

total

and

production

rise from $346

bil¬

(in 1952 to around $625 bil¬

lion in

1977. These

pressive
sized

but

that

the

that

assume

empha¬

projections

rate

will be

im¬

are

trend

our

and growth

gains

must

progress

greater in

With

convinced, on the other
hand, that the expansion of tech¬
nological research into a predict¬
ably productive process calls for
am

the

lifting of

sights far above

our

projections

based

merely on
the trends of the past. The most
important fact of our economic
life

today

midst

that

tion

capable

and

substantial

corded

rates

upward

progress

re¬

heretofore.

the
to

were

sharp

population

make

only

for

made

full

the
the

projections

allowance

not

already

progress

reduction

tion is

and

mortality and the lengthening in
the span of life but also for the
ultimate effects of widespread ap¬

plication
tive

recent

advances

and

prospec¬

medical

tech¬

niques, the gains recorded in
ulation

would

pop¬

considerably

larger than those obtained by a
simple extension of the long-term
trends of the

oast.

is, however, in the area of
productivity that really spectacu¬
lar

progress

be realized.

can

The

.-gains registered in production per
capita could easily turn out to be

impressively larger in the future
than

they

because

have been

in the

improved

technology,
the

which

number

of illness and

medical

should

reduce

lost

days

past

because

full

use

the improvements now clearly in
in
agricultural,
industrial

view

^nd^metallurgical,fechnology

are

capable of raising the rate of in¬
in

crease

the

output

capita

per

.-substantially.
V We have incubating in

oratories, which are now so lib¬
erally, financed by business and
government and so well staffed
with the best trained and the most

practically imaginative scientists
]in the world, a host of new in¬
dustries and an incredibly long
list

new

reduced

and

widened.

of producing
that costs can be

ways

cheaply

markets

our

but

are

can

the

(1)

tion

lies

behind—

of—not

ahead

personal esti¬
mate-—shown in the upper broken
Therefore,

lines

tials

chart—of

the

for

1977

easily have
millions,

value

capita

per

poten¬
could

of 230

goods

and

1952 dollars of

that the total

nation's

the

population

producing

services valued

$3,300

that

production

again in 1952 dollars, be
three-quarters of a

would,

than

charts

raise

im¬

three

(1) Why should so many of our

people have such a psychopathic
tear of depression when in the
153

past

years

have

had

of them and yet made such
.great progress?
many

(2) Why should so many people
contort

all

its

policies to

prevention of even the slight¬

est recession in business when the
more

■•should

which

will

important
to

create

insure

objective
a

climate

rapid

and

substantial growth of the economy
ever

the years and decades ahead?

return

economic

stagnation in

at¬

tempt to attain economic stability?

That

why

the

recent

NYSE Installment Sfk.

rise

Funston, President of the New York Stock Exchange,
explains nature and operation of the plan designed to make it
easy for purchase of stocks by means of small but
regular

reassuringly

reduced government

abandonment

popular

for

the

long

that

providing for the

program

the

stimulant

our

most

ap¬

powerful

arsenal

anti-

depression techniques, namely, tax
reduction, which will increase the
spending power of the people and
business

far more effectively
safely than is possible through
dangerous dose of deficiteering.

and
a

(3)

The

abandonment

government

controls

ventions which

terprise

and

are

inter¬

onerous

the

prevent

en¬

price

system from acting as a stabilizing
agent; and

(4) The insistence that all seg¬
ments

of our economy — labor,
agriculture, business and finance
—adopt policies, which by foster¬

ing investment and increasing ef¬
ficiency will insure that the na¬
tion's

rate

nothing

future

growth will

than

less

which

mum

the

maxi¬

technology will

sup¬

port.
The

present situation

clouded

tainty

with

and

strengths

full

be¬

uncer¬

long-term

to make it unwise to

favorite

short-term

indulge in What has

become

now

such

Rather

the

such

and

the

situation

preparation

calls

list

general,
rather
than
guides
for
business

pe¬

specific,
planning,

which will provide an appropriate
frame-work within which

policies which will help us to
avoid the pitfalls and to take ad¬
vantage of the opportunities in
the turbulent and uncertain times

corrective de¬

it need not

come

into

With

large

deflationary

defense

our

is,

our

well

their

program

short-term

economy

may

primarily by

developments

effect

and

could

government

convinced that

well

base

gramming

will do

planning, pro¬
budgeting on the

our

and

war

temporarily infla¬
A greatly improved in¬

tionary.

ternational

situation would in all

probability

deflationary from
the
short-range point of view.
However, our long-range outlook
clearly is for a period of great
growth and expansion no matter
what happens in the international

sphere.
(4)

While 'we

(1)

depression-proof
is

reason

could

1929."

portant

overwhelmingly

fact

States

tries

and

several

expand at

rate

that

the

im¬

United

a
growth country
important new indus¬

many

for

large

areas

sure

spectacularly rapid

many

ahead.

years

And

with

population rising sharply and
productivity spurting upward as a
result of technological
progress,
the long-term trend in production

easily

can

ward

the

been

sharply

up¬

than

future

boom

however

government,

well-intentioned,
that

surance

"another

inflationary

long

any

that

provide

can

as¬

is de¬

company

History, economic
common
sense
and the

pression-proof.
theory,
facts

argue

persuasively that it simply

our

new

Nevertheless,

Administration

defenses

carefully

life

economic

all

our

preparing

against depression so

and

reorganizing

policies so
skillfully as to justify confidence
that we will, in fact, be able to
prevent any economic readjust¬
ment
from
deteriorating into a
long and disastrous major depres¬
government

economic

sion.

"Little"

(2)

depressions

from the need for

chasing and/or

pause

expenditures to offset
sion

business

inventories

country
panded

and

grow

pur¬

has

tration's
will
in

anti-depression platform

be to

which

create

the

growth

dynamic

our

the

long

potential in

will

economy

be fully

range

(5) ..Our
much

environment

business

over

would

and

prosperous

be
our

overex-

capacity

never

"Big"

are

very

long

are,
on
the
primarily financial in
They come when debts are

depressions

other hand,

origin.
so

high, financial positions

tended

and

financial

so ex¬

institutions

Plan

Pffl

would

for
use

Mr.

Funston

explained,

designed

small

cash

Keith

Mr.

Funston

said

every

ductions

perfected
odd-lot

Jacquelin

the Plan

and

Carlisle

Coppet & Do-

remus, in cooperation with mem¬
ber firm doing a commission busi¬
ness

and

self.

The

with the Exchange it¬
Exchange, he added, has
functioned largely as a clearing

house

for

forced

sus¬

payments

it*.

ideas

information.

and

"Basically, the Plan

Funston
by

states,

payroll

de¬
by special arrangement

individual

employers.

had

by the two lead¬

dealers,

Mr.

financed

may

with
Funston

been

monthly

Plan,

every

to $1,000

The

little

invested

may

Plan,

month.

ing

Jones

his

charge.

Under terms of the

Mr.

full share.

two or three
months, his broker*
merely temporarily suspends h, i
purchases.
There
is no
penally

payments.

$40

additional

pend

but

three months

broke-'

he could buy
fraction needed to
or

Exchange commission.

people to
buy securities

regular

If, at any time Mr. Jones wished
terminate
the
plan and h ::
holdings
included
a
fractional

easy

for

;

Mr. Jones may also direct hFi
broker to sell out his
holdings a ?
any time and at no charge excep'
for the customary New York Stock

Plan,

make

shares accumulated,

such dividends maile

directly.

make

day, Jan. 25.
The

to his

the

Mon¬

his

have

to sell it for cash

b 1 ic

p u

share, he could direct his

available

ceived

Bache & Go. Sponsors
Financial Newscas!
Bache

Co., 36 Wall Street,
City, during the cur¬
Newspaper strike has ar¬

New

York

rent

ranged
tion

cooperation

WOR

provide

with

Sta¬

complet'

ex¬

financial report three times dail

en¬

abled millions of Americans in the

providing a market synopsis art?
a representative list of New Yorx

medium

Stock

tension of the idea which has

low

and

income

out

pay

groups

for

"The
does

Monthly

Investment

involve

not

the

credit," he continued.

does,
of

$30

Exchange quotations.

their

homes, automobiles and major
pliances," Mr. Funston said.

ap¬

D. E. Arries

Forming
Own Firm in Tampi

Plan
of

use

"The Plan

odic payments."

a much higher
living with govern¬
expenditures—and, therefore,

ment

taxes—at

government

mained in
lion.
be

$20

even

billion

than would be the

per annum

re¬

the

vicinity of $75 bil¬
readjustments would

Some

inevitable

during

the

process

of deflating the government's role
the

but

economy

the effect

run

the long
help but

could not

however,

allow

moderate

This

case

expenditures

Mr.

person

buy

industry by small peri¬
method

new

Funston

made

the

means

points

available

investing
will

out,

the

public
through member firms of the Ex¬

change;

it will not be
by the Exchange itself.
The

only

charge

sponsored

Fund,
Ca¬

and

mutual

Calvin

Bul¬

lock.
K

V,'

A prospectus on
from your

operating

result

number

Irving's

and

Incorporated

Street, New York 5, N. Y.

economies

the

increased

shareholders

who

building their investment
in this popular way.

are

estate

City

The effect of this reduction will

ing

the

privilege

smaller

number

own¬

October

able

the

charge

was

group

to fall below the Sep¬

the

tember level

retail

only

advanced

1947-49

The retail cost of food de¬
clined 0.4%

period.

to the decline were susbtan-

tially

lower

dividend

por¬

reinvest¬

available

now

who

yield

"As

all

own

enough
quarterly divi¬

increasing

prices

Fruits

pay¬

fractionally

advanced

0.3%

Solid

Fuels

ONE
WALL

salesmen

STREET

vin Bullock stated.

Custodian

Canadian Fund.

Trustee,

record

effective

Jan.

follows:

the

Address.

Funds.

announced

2, 1954 and payable to holders of
1953

Name.

has

distributions

stock

prospectus on

result

fuel

200%
shares

stone

4:30

p.m.

31,

distribution

outstanding

rently 217,783
310

oil.

326,124
592

now

25,000

American Chicle

value of

20,000

Deere

32,000

Filtrol

19,000

than 65,000.

more
were

Additions

sharehold¬

number

and

assets

portfolio during the year
Oct. 31, 1953 follow;

ended

were

established both in

were

ers,

earlier.

year

equal

Corporation

L. Green Company

International Shoe

2,200

Lone

with

compared
Oct.

30,

Oct.

31,

were

made

10,000

Mississippi

20.000

Oklahoma Natural Gas Company

Pacific Gas

Gov¬

20,000

Southern

increased

23,000
25,000

Swift & Company
United Fruit Company

85,000

United

19,000

Allis

was

12.7% on
adjustments

1953^ to
that

and
in

investments

its

increase holdings of a more

the

Company

Gas

Company
*

Corporation

Chalmers

Manufacturing

Can Company

vertible

16.5%, oils 10.8%, chemicals 8.4%,
trade
7%, railroads 6.1%
smaller holdings in a num¬

Electric

Fund

"K2"

Key¬
(cur¬

shares held

shareholders).

This

Fund

Co.

Island and Pacific

Company

higher
Gas

Masonite

5,000

Corporation

Carolina

South

40,000

Electric

industries.

Incoming orders of major manu¬

have shown
for the
past four months and unfilled or¬
der backlogs have been- reduced
materially, the report states. This,

facturing
a

companies

together

with

CLOSED-END

downtrend

pronounced

the

ciirrent

manufacturers'

The

high

$178.38

inven¬

further cut in the rate of indus¬

trial
are

production.

good

reasons

readjustment
be

However, there
for expecting the

now

in progress to

relatively-* mild

derly character.

and

NEWS
The

Equity

Corporation for the nine months
ended Sept. 30, 1953 show net as¬
sets
at
that
date
equivalent to

tories, suggests the possibility of
a

statements

or¬

share of 52 Convertible
Stock
(preference
in

liquidation $50 per share and ac¬
cumulated
dividends), and $3.55

of
Common
Stock.
June 30, 1953 were
$176.93 per $2 Convertible Pre¬
ferred Share and $3.51 per share

per

Figures

per

Preferred

for

Common Stock.

;

Fundamental Investors, Inc*

Diversified Common Stock Fund

Diversified Growth Stock Fund

Elec¬

The Other Goods

Services

includes

group

tobacco,

over

Diversified Investment Fund

which

alcoholic

beverages, legal services and

Manhattan Bond Fund, Inc*

banking fees advanced 1.7%
to

level

4.1%

.year ago.

that

above

PROSPECTUSES

The Apparel

mained

unchanged

month.

The New York

Consumer
=

Price

100

over

Index

the

City
on

AVAILABLE

FROM

YOUR

LOCAL

THESE

MUTUAL

INVESTMENT

FUNDS

DEALER.

Cleveland

Chicago
Los Angela

San Francisco

Hugh W. Long and Company
Incorporated

base is 187.5

3,-

Westminster at Parker,

Gas

Company

;

unchanged

period.

con¬

Company

retail

prices

and

•

preferred class A
Electric
Illuminating

Cleveland

16,000

Gas

Chicago, Rock
Rairroad

and

ber of other

Gas

American

utilities

included

year-end

Natural

American

35,000

3,300

holdings

Electric

Company

stable

23,100

Fuel Corp.

River

Eliminations

nature.

Diversification

Company

Electric

26,000

and

bonds

April

McGraw

that the Fund's

moderately from 9% of net assets
on

4.75%
preferred

convertible

10,000

1952.

31,

cash

$1.83

Company

Gas

Star

cum.

share,

Company

5,000

$1.80

eliminated

and

added to

Issues

from the

with

compared

Oil

2.0%

remained

1935-39

City

Calvin ;

$116,$108,740,New records

pany's fiscal .year-end,

halved

been

has

assets

net

and Medical Care groups re¬

stock

Growth

Dec.

the past seven years.

tricity and Housefurnishings

and
as

was

between

the

NEW YORK

growth

the

over

Fuel

and

substantial," Cal¬

cents.

163% and
216% with re-r
spect to each share outstanding 10
years ago.
The ratio of expenses

Shares,

mutual fund managed by

The composite Housing in¬
dex

for

com¬

distribution

gain

capital

seven

month.

the

Inc.,

year ago.

per

bakery prod¬
dairy products in¬

and

creased

are

value

asset

and

dividend, income

KEYSTONE

vege¬

tables, fractionally higher in

quarterly, the benefits of 'con¬
tinuing income' to dealers and
be

fish

and

was

can

the

October, than September,

sub-group

their

for

and

6.4% lower than

Bullock, at Oct. 31, 1953, the com¬

September and October. The
of

number

clients accept this method of

pounding

one-

Contributing

poultry

dend of $10 or more.

Dividend

assets

level

during the

group.

dealer.

cur¬

rently 113.3.

ucts

for

base

100

meats,

charge less the bank's lees.

ment

obligation please send

major

The New York City index on
a

after

In-

Reports New High
Net

the index of

prices

Cereals

shareholders

Statistics.

Food

rein¬

now

investment

Automatic

GENTLEMEN: At

Labor's

Labor

sales

than

Director of the U.

Department

Bureau

As before, dealers receive the full

„

0.1%

today by Robert R. Behlow, '
Regional

every

Dividend

announced

was

automatic

vestment, and to increase the
tion of the sales

New

averaged

September, it

month

be to extend^to^shareholders

jCALVIN BULLOCK

moder¬
in

the sixth consecutive month.

This reduction is made possible

investment dedler or

Distributors Group,
63 Wall

request

families

„

higher
CALVIN

bought

income

Net

1953.

share climbed from $4.74 to $4.81,

Capital

ernment

Retail prices of goods and

1951

creased

income growth was

reserve

To Rise in New York

.«

popu-

Retail Prices Continue

1950—

This

of $3,493,736, and its
market value had in¬
by $3,207,499 as of Oct.

gains

31,

has

Financial

since

The report states

1.76

171.20

dividend

shareowners

Assets

3.27

179.40

1948

Group Securities, inc.

months

7.40

—

1947—

Keystone

(currently 2,068,764 shares held by

1.45

1946

]FUND

Income Common Stock Fund "S2"

4.99

191.46

paid

ital

announcement,
a

The company added

51,725,733.

portfolio

share.

per

shareholders
121.089;
and
outstanding from 47,177,414
110,486

$22,096,677 from the sale of addi¬
tional capital shares, realized cap¬

dividend

cents

this

that

said

three

6.32

1945

ADMINISTERED

with

shareholders).

making

been

4.90

129.57

1944—

THE FULLY

long

records

outstanding

15,354

1943—

with

distribution

stock

three

total

se¬

.13

...

1.78

1937

100%

$223,470,-

to'$248,744,204;

from

Financial

The

announced.

Smith

This

objective of securing "blue
chip" common stock income.
A

1.10

144,13

183.22

104.04

142.35

«'

1935

3, PA.

the

1.76

15.97

shareowners

the

well-known

dividend

consecutive

net

year

from

increased

assets

fiscal

the

During

„

Fund, Inc., Charles F.
Smith, President of the corpora¬

the

1953.

31,

Industrial

the

1934
A

large and

corporations

6.62

...

and
shares
out¬
its 20th annual re¬
port for the fiscal year ended Oct.

af¬

invest¬

stock

common

standing,

Keystone

fully invested

300.00

1933

Prospectus from

by 1,643 shareholders).

248.48

1932—

outstanding

stock

larg¬

second

shareholders,

quarterly
approximately $199,will be paid on Dec. 15, 1953,

000
to

High-Grade Common Stock Fund
"SI"
(currently
143,042
shares

238.95

1931

72nd

dividend

peak of 75,-

A 200% stock distribution on

the

Year

Latest

Fund,

companies, reports high rec¬
in
net
assets,
number of

ords

by 47,800
number,

this

will

293.38

1930—

held

the

ment

distributions

THE

the

in speculative
preferreds offering sound oppor¬
tunities for capital growth.

1929....

FOUNDED

Affiliated

est

shareholders

primarily

1928—

while

shareowners

gain

invested

curities

Lost

tion

Fund

Year

$220,000,000

Gains
In

374

17,000 new
shareowners in this period.

held

Affiliated

just announced.

■■■

WELLINGTON

assets

23,841

by nearly
all-time high

new

000—a

tax

total

fected

Wain

rose

number

this

the .year that the year
been
as
bad
as
we
had

month

in¬

common

objective of capi¬

shareholders.

year

one

notes, "or maybe it's because we
usually find as we enter the final

HlmiiniHimi

cyclical

10
Keystone
Funds combined is 14,274,148, and

figure

7,000,000 to an
of 26.5
million,

selling is over
December," the report

early

the

outstanding

ills

happens

share¬
fully

2,798,714 shares currently held by

were

the

for

Sept. 15. 1953, a fiscal
distribution of $426,436

year-end

rising markets.

paid to FIF shareholders
In addition, shareowners

received

The total number of shares out¬

standing

Hare, Vice-President, shares

con¬

other

1953

31,

ago.

the last 25
have much

seem

"Maybe

because

way

the

growth

than

from

million

$105.9

politics,

war,

plagued

don't

years

effect.

120 Broadway, New York 5, New

notes,

recession, taxes, price

peace,

NATIONAL

Oct.

According

As the Fund

tal

represents

has risen.

PROSPECTUS

$128.8

were

million

In¬
gone

In 11 of the last 11 Decem¬
bers,
the Dow-Jones Industrial
up.

FREE INFORMATION

stocks with the

approximately $681,843,

369,125

3,534

Fund

vested in leading

according to their Semi-Annual
Report just released.
This is an increase of $22.9

Dow-Jones

Average has

jYear

This

1935.

1953.

„in

have pointed

news,

distribution

(currently

held

holders).

Net assets of the National

bit of cheer¬

Million

"S3"

National Securities Gains

securi¬

stock

outstanding of Key¬
Speculative Common Stock

Fund

eye

100%

Inc. was estab¬
Quarterly divi¬

Fund,
in

IIV2 cents per share, will have

stone

STATISTICALLY-minded

your

been

the

for¬

merly with Dean Witter & Co.

dends

First

was

lished

ing generous income.

Mutual Funds

become

has

dustrial

stocks of good grade with es¬

tablished records of dividend pay¬
ments for the purpose of secur¬

mon

Chronicle)

Calif.—Irwin

DIEGO,

Beadle

with

The

Thursday, December 3, 1953

...

Elizabeth

New Jersey

Volume 1*8

Number 5273

...

The Commercial and Financial Chronicle

(2179)
from security

profits, at the rate

Continued

of seven cents
per share.

Financial

Industrial

assets reached

$15,993,729
increase
The

by
is

year ago,

over

set

Pressure

Smith said.

of the Fund, owned
than 10,000
shareowners,
invested in the stocks of 74
America s leading
companies.

merit

6 Jo

Oct.

Fund

re¬

31,

1953, total
$1,650,000
compared with $1,400,000 on Oct.

net

assets

31, 1952.
share

amounted

The net asset
Oct.

$11.65,

value per

tage

compared

with

$11.74

The

telling

prevent
A

Kennedy-

Financial

CLEARWATER,
Deringer

Kidder

How
the

the

Florida

market.

"hard

with

Co., 405 South Garden
He

previously with

was

Securities

Company.

repeating

has

pressure

The

course,

QUARTERLY DIVIDEND

$50 billion total by 1960.
growth,
however,
comes
problems—we might correctly say
we
are
experiencing
growing
project

money

which

been

termed

"sound

money," has given way to
resumption of a managed mar¬

And

Private

who

from

the

Enterprise
protestations

loudest

interest

rates

ranks

raised

levels—

Ad¬

the

is the

course

Secretary

program.

Benson

has

always recognized that farm
price supports are basically un¬
and

posal

And

the

course

such

first

pro¬

those

former strong believers in Private
such

soundly developed.
necessarily in the order of

portance, here
problems:

our

it.

The law calls for

farmers

definitely

few

December

22,1953,1c stock of record December 3,1953.
BUILDING

•

raisers

SAN FRANCISCO 4

supports

fatten

However,
the price
farm products needed

rancher
his

and

cattle,

burden

creased

forced

the

and

have

either

to have

in¬

the

drought

rancher

for supports

scinded

feeder

stock

ask

them

re¬

all products. If govern¬
ment income can afford handouts

~Seor.ae

PUTNAM

Europe
And

slow-down,

the

says

show
you

another

ties

where

few

that

associations

years.

and

time

that

Don't

the

advocates

fighting

economy are

fore

overlook

their

resume

the

fact

managed

1,000 associations are
their maturity
during
and 1955. The figures quoted

1954

tions

likewise.

associations

required

higher dividends do

divided

tions

and

profits,

only

give

and

reserves

un¬

associa¬

1947

are

and

indicates

1952

real

that

doubt

making
their 5%. The 54 experienced an
average

The

will

Board

call

this

attention

the

fected associations. When

af¬

course

cancellation

Naturally their ex¬
ratio and their reserve ratio

pense

will

carefully scrutinized and

reduction in dividend
be required. The Board

possibly
rate

may

has

determined

satisfactory

time

most

computing

for

ratio is the first semi¬

reserve

period

following

the

in¬

anniversary.

surance

the

that

the

meet

at the

not

might

asso¬

We have available

the

magic

From

Akin

rate

scribing a carefully worked
out, pre-packaged, bal¬
anced retirement program,

combining dollar annuities
with equity securities. It

money
ers

have

the

under Board

any

constantly
tions

control,

how

business

even

small

profit by the
tax advantages of a quali¬
fied retirement plan.
For

your

can

free

copy,

remains

and

mail this

advertisement with your personal
or business card.

such

Kidder, Peabody & Co.
Founded 1865

op¬

make.

affect

termine

-W Vrray Hill 2-7190

manner

children

your

will

for generations to come.

de¬

living

their

and

children

Will you

always be alert to defend and
fight for Personal Liberty under
representative Republican Gov¬

ernment, with powers defined by
a
Constitution? Or will you sel¬

fishly concede
other

for

Socialism,
with

false

ever

Let's

has

under

economy

political
glance

out¬

loan

and

study of

loan

business

^impressive gain in

$11

some

reserves

in¬

should

plan for building ade¬
after

reserves

reached.

Frankly

the

formula makes what I call

current
sound

operation and rapid growth very
difficult
to
accomplish without
in

decline

reserve

association

has

gross

30%

located

rates

of
in

are

quite competitive,
most

ratios.

expense

where

area

average

ratio
is

and

interest

loan fees
it becomes al¬
and

impossible to experience

share gain of 15% to 20%
more
without a reserve ratio

annual
or

decline.

When

this

study

ad¬

vanced enough to

proposal,
submit it

permit a written
will gladly
for study and considera¬
the

Board

the

billion

1947,

postwar trend toward more rapid
turnover of savings. But this still
points to the need for each man-

added

study

aSer

characteristics of his

commissions

first

fully

unless

advised

the

will

mean

consents
of

The

broker

figures

December 31

increas-

tion.

indicate

peak business

can

commission

Consumers and business

try

for

conclusions,
terested
150

the

not

associations

disclosed:

will

you

know

produced

brokers.

jump
that

in-

using brokers
their loans

(1)

that

exceeded savings capital substantially; (2) their cash and governments

were

below average,

they possessed

less

their borrowed money was
not

necessarily

indicative
crease
were

the

than

Some

(3)

and

higher,
to

pressure

the

in-

faster

ance

and

rate.

The Board is

consideration to

regulation

that

very

careful

the issuance

will
and

restrict

sent

your

personal

Liquidity

with

This

spells,

management

another

Savings and Loan Competition

Competition is excellent and the

safe

omy.

Sometimes,

however,

exuberance leads to

more com-

—

from

effort

closer attention to

lections.

will
organization
for

mainspring of our American econ-

the

bal-

market,

borrowers'

daily operations — more careful
rate supervision of expenses and col-

commission

important

can

market

operation of a
savings and loan. Is anyone satis¬
fied
that
our
present
formula
offers an adequate solution? Its

factor

curb-

employment

income
lender's

The

for.

sion that there will be

payments. This proposal also
be

loans,

are

petition both for savings and loans,
.

giving

All of which leads to the conclu-

(5) their savings turnover showed
a

beep

will taper off to a more even

reserves

average;

has

expansion of

decline

net

looked

bad practice, but

earnings; (4) their
less

hence

liquidity;

ing the use of credit while the
Federal government will attempt
to do likewise. Consequently we
can expect some small decline in
the 1954 volume of business, probably involving less new home construction.

hasty

study

this

degree

that

though to

year,

substantial

associa-

look back

ing volume of hot money seeking
higher dividends and a repeat

The able and alert manager

to'be

changes
Restraint

own

tion.

client

and

continuation

withdrawal

the

Bar Asso-

ciation

members

mortgages are available, while net

code

ethics of the American
for

but

open,

fair amount

aware

of any

study.

Liquidity

activity.

against

eye

carry

savings show a 20% gain over last
Year- There seems to be some recerd leveling oft of the disturbing

split

our

operations

savings and

from

Operations

the

take

and

made

assets

Loan

for

Board's

The

an¬

bigger government?

much

savings

security

managed

Savings and
So

right after

one

this

freedom,

life—it

your

the

will

quate

the

Exchange

Uptown Office 10E.45thSt.,N.Y. 17
CF

personal

„

rates.

funds

Savings and loans are enjoying
a *ine year* Ample acceptable

concern

investment

weather

0f sajj

are

attorneys nation-wide to

thereto.

Socialism, is the most important
you will ever
have the

look.

Members Neiv York Stock

land

Keep

don't fear

associa-

dividend

one

client

operations

was

the

not

and

principle is a good guide in
operation of our own business,

same

advertise

can

"pressuring"

Recently
send

are

desired,

increase

copy

regulation

because I hold the belief that
being forewarned of a danger frequently aids in averting it. The

relation-

agency

manner

built

proposed

my opening remarks
unpleasant political
possibilities, let me add that I did

practice

association,

have had

Though in
pointed to

from brokers. These brok-

may

ship

15 years to effect needed and
desired changes in the statutes
covering our operations.

„

portant opportunity

Brokers"

the

associations

some

been

clude

than

exceeds

suggestion it have the study of
counsel and tax consultant.
I might say that we took similar
precautions with our counsel.

decision
new

has

your

advertising

other communities is

to meet requirements. A

reserve

careful study.
Pr°Posed, I can see many advantages in it to us in the savings
and loan business. The entire
study should present the most im-«

pulling-power

"Money

ably

Central Mortgage

Bank has had

Pressure

Housing

Pr°Sram for

rate

alone.

rate

whether it goes down the road

chance

booklet for employers de¬

shows

and

portunity
to

Program

insurance

place in the

Whether this country halts Stat-

equals

feserve,

undivided

Committee

order. Too much reliance has been

your

ism

Retirement

have

submitted to your office with the

sun.

A Balanced

that

chairmaned by Albert Cole. The

with

have already been told
the President's Advisory

few

folks do

reason

curb~

e p ac ce.

about

savings and loans
is because of safety, convenience,
availability,
and
rate,
in
that
put

You

ex-

are some

refresh

in-

serious

and

advertise

memories that the

some

& means

Washington, D. C., and Baltimore, to name three that I know
about.

are

cago,

solicited

problem

the abuses

the

by local custom. They do a splendid promotional job here in Chi-

would require

insurance.

the

that

areas

widespread and in

'*j

auto¬

supervisory

that

paying

getting

+v,_f

asso¬

reserves,

becomes

drastic

the

I doubt if any

case.

reaches 20 years and fails

have

condi¬
the

victim

business

tion

truth

areas

Incidentally, there

Analysis of trends of these 54
of

ac-

The 0pp0Siti0n to such programs

!: stances

The

adequate liquidity
proper reserve allocation.

behind.

are

considerable

associations

pense

people who will transfer
from
one
institution

protest frequently

with

reserves

is
then
completely lost,
Certainly it will produce a group

association, in an effort to stem
he loss, increases dividends,
in

based on Dec. 31, 1952, savings
capital. As of then, 630 have their
allowance

paign

local

Actually
reaching

be¬

as never

some

5%, the Board has ruled that such
required part of the undivided
profits
account
may
be
ear¬
marked for loss purposes until the

pushed.

camnaicn

second
association
must
outdo the first. Finally it becomes
a race between all local associations and the value of such a cam-

increase

rently
the regulation
calls for
2 Vz % reserves in 13 years and 5%

we'll enlarge deficits further. May¬
be besidesj further; tax cuts would

Street, Boston

institute

will

another for the purpose of
such prizes.

that

build¬

time

COurse

counts

legal

road

similar

with-

The

indulged in, local associations
bitterly report their withdrawals

them, receiving in return
commission.
It
might be

works,

them

profits account which, with their

Federal

the

Cur¬

requirements.

year-to-year

There

ciations

come

on®

ened the term and established the

can

ing, possibly even public housing
—certainly^' it
will
be
actively

and

first started.

local associa-

truth in that, but that is only part
of the story. Where such practice

the date

lose income from tax reductions—

50 Siatc

a Slmuar campaign.

rate.

indulging

over-supply

other

„

normal flow of money

demand.

however,

some

practice point out that it

increase

will,

tions

low,

akin to

drawals from

ad-

are

Xselv

n is

rl»es,,uis closely aKm to an

successful when it

growth

reasonably expect the government
to take steps to stimulate it. We'll

Putnam Fund Distributors, Inc.

re-

problem

dividends

lncreased dividend rate Generally
a Program a£ th!s. k!nd ls. vteiJ

for

invest-

desire

our

come

of nominal value

in¬
granted. By regula¬
tion, the Board could have short¬
from

years

was

annual

us?

if business should

alarming

FUND

Asia,

and

farmer, why tighten

liquidity

area

matically

Social¬

cur-

Out

to the presentation

an article

^1^7n? ZTift'
Seises the a^unfonL 1"

and

serves

have

always classified

ments acceptable for
rv

which

results,

needs

wider field of

one

ciation

ist-minded.

prodded

changed

our

than

Washington was politically in¬
spired and promoted by some I

by the

stock

and

share Irom investment income and 94 a

2500 RUSS

prices. The march of

ranchers

cover

assists in

voted for government controls and

subsidized

from

age.

The

that

protest

averages little objection

the minimum. The

even

allow for

acceptable—certainly

successful

a merchandise
gift program for
savingSi There would seem to be

need.

^ few°assocfa" of

must

should

rently

of 5%

reserves

wheat

storm

raised

—

have

of all insured accounts in not more
20

the

placing undue emphasis

political suicide to ignore

the farmers

—

that

law

seem

produce

comm"nI"

some

are

consensus

maintain

Not
im¬

share gain of 175% in
the six-year period. Of the 36 in
doubt, 26 gained above this aver¬

seemed

10<

tions

struc¬

our

ture

planned their eventual

Enterprise

share from capital gains. Payable

that

care

are

evidence

abolishment.

INVESTMENT FUND

conditions

pains. Under such

the

letting

over

their

seek

ministration's altered
farm

sound

A BALANCED MUTUAL

With

surance

Reserve's

policy,

have

be ob¬

can

Federal

should

Another

CONSECUTIVE

your

Adequate Reserves

the Bankers!

mid

Those

altered

change in the

money"

think

Chronicle)

Fla.—Douglas

now

anything

recurrence.

Administration's

ket.

Avenue.

President, to
$25 billion today. It's easy to
was

must exercise

bear

tempered its decisions

With A. M. Kidder & Co.
The

over

Resumption of "Managed

served by the

cease

when

Money"

Peterson, Inc., 75 Pearl Street.

(Special

will

you

it will

and

Chronicle)

with

now

that

You know every word is the

truth,

Financial

When

progress

not

new.

HARTFORD, Conn.;—Sidney C.
Clark

place,

of pot¬

mess

has made America grow
to live.

Kennedy-Peterson

(Special

personal liberty out

security!

is dead and
the individual creative spirit that

With

called

takes

31, 1953, amounted

year earlier.

one

will pitch

at first

fnsriia 2S lhe
age

re-

it has been

currently of 15 %, which

average

shows the

Administration's Policies
weakened our moral fibre that

of the window for

Mutual

lack of

its

liability. All finally turn out to be
injurious,
associations
have
an
Qne such, in the opinion of many,

insured

Groups Disrupting

the

capital

ported

principal

GUARDIAN.

page

straint. By regulation

all-time high of
Nov. 13,
1953, an

$3,573,411

from

net

date

samp

Fund

our

minor.

our

economy,

will

impending

major

stand in

this position of combat readiness,
the
one

coming year can become
of continued growth and

practices that broadened service to your public.

Financial Chron icle... Thursday, December

The Commercial and

3, 1953

(2180)

from page 11

Stock Investments from the

increases

Furthermore, during this period
about two years, federal taxa¬

tion of the undistributed net earn¬

strongly

pos¬

higher

yields or, giving effect to federal
income taxation, higher after-tax

capital

prudent

and

management
should

trustees

remiss

yields

discharging
responsibilities were we to fail

our

ing the overall rate of return from

earning

the avoidance of the burden of

taxation.

unnecessary

eral

factors

taxation

banks.

You

sidering

mutual

the

ternal

the

those

except

public utility preferred stocks, the
combined
of 52%

normal

is reduced

rate of 7.8%

rate

effective

with respect to divi¬

income.

dend
It

surtax

and

seems

inadequate

been

given

nificance

that

ways

the
the

some

recognition has
investment sig-1

market
savings
banks. Share ownership affords in¬
from

the

vestment

equity

standpoint
to

access

areas

the

country's jindustrial econ-j
which are to be found sig¬
nally successful corporations with
well-established earnings power,
impressive dividend records,, and
Omy in

favorable prospects for growth. It
is true, of course, that in

consid^

eration

the

major

expansion

in corporate borrowing during the
last
few
years,
the number of
capital structures without funded

debt

has

been

Nevertheless,

signally
it

is "a

reduced.

fact

that

equity

securities of leading cor¬
porations operating in major seg¬
ments of the country's industry
represent

high degree of quality
security.

and

Risks Involved in Stock
Investment

There

doubt

repre¬

equity

and

inclined

fluctuate

over

bond

and
mortgage investments.
Equity securities are without con¬

markets

tractual

From

yield

return

and

gation

for

tion

residual
and

equity

interest
of

assets

obli¬
posi¬

unattractive

rate

investor

representing a
in the earnings

the

issuer.

re¬

flecting this marginal position such
securities

subject

characteristically

are

wide

fluctua¬

market

tions.
any

given time the market

common

stock

usually re¬
appraisal of the
prospect for future earnings and
dividends.
High prices and gen¬
erous
earnings are characteristic

flects

current

periods qf prosperity, while pe¬

riods

business

declining

falling

junior

equities

prices.

should

such

vision

should

market

given

judging

the

securities

for

savings banks and obviously

such

and

marked

characteristics

recognition
of

are

depressed

radical

propriety

earnings

contraction

These

due

pointing

made

fluctuations

concern.

pro¬

sustain

without

under

higher interest rates
prices, while they

attractive

are

outlook

the

when

favors

declining interest rates and
rising bond prices.
Observation
stock

market

mate

reveals

yield

the

of
over

preferred

considerable

certain

spreads

approxi¬

that

suggest

the relative attractiveness of pre¬
ferred stocks from a purely mar¬
ket standpoint.

According to these

criteria

should

there

ap¬

proximate minimum of 100 points
in
yield
between an
industrial

preferred

stock

bond of the
or

and

same

long-term

company

hypothetical), whereas

approximately

yield

is indicated

ity issues.
respect

125
for

(actual
spread

points

The larger spread with

public

acteristic absence of capital
the

provisions.

fractional

moderate

production—

over-all

recession, however,
would be marked by a reduction
in
demand
for
both short and

dex.

Such

long-term
doubtedly

credit and would un¬
be accompanied by a

With

would lead the prudent in¬
vestor, it seems to
me, to
the
conclusion that under prevailing
conditions the so-called defensive
ket,

re¬
Presumably

foregoing differentials should

the

;> .•>'

market

stock

historically high level, timing be¬
comes
an
extremely
important
element in the accumulation of an

public utilities equity portfolio. To avoid the ac¬
prominent example, cumulation of a large portion of

issues, of which the
the

are

should

most

such investments at relatively high

constitute the bulk of any

junior

investment

this

industry would seem to com¬
its

mend
to

junior equity

serious

tors

securities

consideration by inves¬

relatively

seeking

generous

yields and a strong element of
protection in the field of common

dustries

are,

course,

which

other in¬

the

common

major

objec¬

markets which

are

acteristic

radically char¬

junior equity securi¬

ties

emphasize the necessity for
appropriate care in determining
the basis of accumulation to avoid
unnecessarily high book

costS.; j

It has always seemed to me
sound

lion

that

procedure in the aeciunula-

emission

conditions

can

new

cor¬

taken

stocks

may

considerable"

period reflecting
levels,• and;j suc¬

different market*t

cessive periods *of
to

business activ¬

The most practical approach '

ity.

this

problem for- the- average
savings bank is probably the op¬
eration

known

dollar cost

av¬

Under- tbte procedure- the

eraging.

investment :of

a
specific sum ofrepresenting :presumably/v
an approximate percentage of the
common
stock objective
over
a

money-

predetermined

period, should re¬
prices. Dollar

sult in fair average
cost

averaging is particularly de¬
in

sirable

prices

periods

invested

chase

declining

the

number

increased

specific amount
periodically will
pur¬

since

the market declines, with

the result that the

weighted

aver¬

price is lower than the arith¬
metic average of the prices actu¬

age

ally paid.
all

investment
of

matter

ciple

is ultimately

judgment,
cost

dollar

the sound

with

not

prin¬

averaging to

properly be

for

that the official credit
policy of the government would
be appropriately liberalized.
granted

portfolio

for

bank.
In view of the

into some
university,
exposed and vul¬ pension and other institutional en¬
mutual

savings

nerable

position
of
the
stock¬
holder, it is unnecessary to empha¬

Guaranteed Railroad Stocks

Guaranteed

stocks

railroad

issuers rank among the high grade
railroad
nancial

securities

position

where

the

fi¬

of the guarantor

plans

have

vogue

come

among

dowment funds in connection with'
common

stock investments.

Obvi¬

the importance

corporation is strong, the property
by the issuing corporation corporation within an industry in
with
is strategically valuable
equity
invest¬
and. of connection
course,
where the terms of the ment. Frankly, in this connection,

owned

ing

general

of a continu¬ ously the purpose of such plans is
to
reduce
significantly the ele¬
ing study of economic conditions
ment of judgment through provid¬
as well as an informed analysis of
all pertinent factors bearing upon ing a more or less mechanical pro¬
the position of an industry or a cedure for controlling the acqui¬
size

junior equity position <
would almost of necessity require
a

inconsistent
There

Widely fluctuating

stocks.

should

prices

tive of policy.

point out that there may be tirnes
regarded
and conditions warranting a tem¬
as
embodying defensive charac¬
porate securities. Furthermore, as
porary departure from this prin¬
teristics of varying degree,
The
far as corporate capital require¬
ciple.
For example,
an
unex¬
relative
stability
inherent
in
ments are concerned internal fi¬
such
industries
as
food,
retail pectedly precipitate or extensive
nancing will undoubtedly play a
decline in prices might well jus¬
trade, and containers, as well as
conspicuously more important role
tify some appropriate acceleration
some
others, is now a matter of
as
a
result of higher charges for
of the purchase program,
while,
informed
recognition.
Common
depreciation.
Also,
institutional stocks
representative of these so- per contra, a comparably sudden
accumulation
of
savings
would
or extensive advance in the mar¬
called defensive industries subject
continue with little if any abate¬
ket might furnish the basis for a
to conservative limitation, proper
ment and the investment of these
selection and appropriate diversi¬ prudent decision to reduce or sus¬
funds
would
probably exert a
fication would probaly be consid¬ pend purchases temporarily. *.
downward
pressure
on
borid
Within the last 20 years or so
ered as suitable components of a
yields. Additionally, under such
soundly conceived junior equity techniques known as formula tim¬
diminished

public util¬

utility issues is
a
reflection mainly of the rela¬
tively heavy debt and preferred
stock capitalizations of public util¬
ity companies as well as the char¬
tirement

probably
not
more
than
the
equivalent of a 10% to a 15% de¬
cline in the Federal Reserve In¬

conditions

and lower bond

period

for

preferred and com¬
radically different.

are

The

repayment.

marginal

range.

strictly market standpoint
high-grade preferred stocks are

they involve

the

purely

fixed

for

stocks

mon

than

decline

price

and

Thus the factors which control the

Timing

the stock mar¬

usual reference to

greater

ordinarily confronted in

issues

extent in

some

particularly with respect
of originally
marginal

equity se¬
curities by a mutual savings bank.
The defensive or protective char¬
acteristics
of
these
securities
would
seem
to be
particularly
outstanding, although the record
The cumulative dividend feature
is
not
without convincing
evi¬
At
present, high-grade public
and the power frequently present
dence that they can suffer sub¬
utility preferred
stocks can be
to prevent the issuer from incur¬
stantial price depreciation under
purchased to yield within a fair
conditions
of
severe
depression
ring funded debt without the
range of 4%% although in indi¬
and market weakness.
'
approval of the preferred stock¬
vidual instances higher yields can
holders representing a stipulated
The
pronounced growth trend
be
obtained.
Various preferred
percentage, usually two-thirds, of
stocks' of public
utility issuers, characteristic of the electric light
the outstanding stock, are addi¬
and power and the gas companies
which embody the basic soundness
tional
elements
of strength.
A
of
this industry, but which fall together with discernible areas of
noteworthy feature that has be¬
further expansion would seem to
short
of
the
highest statistical
come
characteristic of preferred
constitute
reasonable
assurance
classifications, can be obtained, of
stock
financing,
particularly in
that earnings over the years will
course, to yield substantially more.
the case of industrial issues,
is
continue to rise, and that at least
While this market in recent weeks
the so-called sinking fund or capi¬
for the visible future any reces¬
has advanced in
sympathy with
tal
retirement
provision,
under
sions in earning power are likely
the
high-grade bond market, it
which, contingent upon the avail¬
to prove both moderate and tem¬
still offers what to me seem to be
ability of earnings, a fixed per¬
relatively
attractive
investment porary. The foregoing statement
centage of the original issue is
is made with particular reference
opportunities, particularly to those
repurchased annually.
to operating companies of which
savings banks the undistributed
The market for high grade pre¬
residential and commercial distri¬
net earnings of which are subject
ferred stocks fluctuates in response
bution constitute a significant pre¬
to federal income tax.
to movements in long-term inter¬
ponderance of the total, and, of
There is a cumulative evidence
est rates and to those factors which
course, it presupposes a continuity
of impending contraction in busi¬
of constructive regulatory policy
dominate
the
bond
market, al¬
ness activity, although most econ¬
on the part of various responsible
though it is somewhat less im¬
omists
reject the likelihood of bodies. The distinctive features of

claim

true to

been

the past,

principally of railroad
quality. To me there is little doubt
promise the greatest de¬
that a carefully selected portfolio
gree of dividend
continuity and
of preferred stocks of investment
market stability, assuming proper
grades will afford a measure of
emphasis on quality.
These are
protection greater than that to be
obviously factors of signal impor¬
found in common stocks and that
tance to an
investing institution
such
investments,
subject to
such as a savings bank.
proper timing, would fulfill a con¬
Other characteristics commend
structive
purpose
in the equity
preferred stocks as a class to in¬ investment program of a savings
vestors of conservative disposition.
bank.

securities involve risks in addition

those

have

mediately sensitive to those forces

that

supervision, and in short, to
perform the necessary functions
of investment management.
*4.

important

standards

exacting

the

maintain

with

issuers,

certain

are

sentative

In¬

Revenue Code, to all divi¬

dends

pre¬

of course, guar¬

which

stocks

anteed

divi¬

which applies,

limitations

securities

equity

ferred stocks. and,

con¬

intercorporate

dend credit of 85%

subject

Banks at This Time

Among

savings

that

aware

are

Most Attractive

Equity Investment for Savings

fed¬

involved

assets.

Preferred Stocks:

Surely it is unnecessary to stress
this group the basic in¬

before

vestment

equi¬

investments in

from

ties with the objective of increas¬

that the average sav¬

question

ings bank is properly equipped to
make the requisite
analyses, to

would

well

of yields. Savings banks should have
no
primary
interest in capital
funds and re¬
gains either as a means of aug¬
serves
aggregate at least 12% of
deposit liability, has been a factor menting income or in an effort to
increasing the attractiveness of provide some protection against
inflation. Our institutions are un¬
equity securities to the savings
der no legal obligation or moral
banks. I have always looked with
disfavor on any manifest distor¬ compulsion to protect depositors
of the dollar
tion of investment
policy based against erosion
through inflation. Mutual savings
upon purely tax objectives, but I
banks should seek only the higher
am
convinced
that
as
the

are

der

ings of mutual savings banks,
which

securities

and unusual conversance with in¬
present income tax laws, as guarantor corporation. Under ac¬
However, it
practice of the Inter¬ vestment processes.
as
wider recognition of the counting
state Commerce Commission rent seems to me that in many institu-,
strong investment position of many
for
leased lines, including divi¬ tions of small to medium size con¬
public utility as well as other pre¬
dends on guaranteed stocks, ranks stant pressure of other duties and
ferred stocks, is suggestive of an
obligations on responsible officers
influence that may tend to modify equally with interest on fixed in¬
is likely to result in a denial to
terest obligations.
somewhat these yield spread cri¬
the equity portfolio of the inten¬
Guaranteed railroad stocks for
teria.
sive
and specialized supervisory
Under existing conditions, sav¬ the most part are closely held and
effort that it requires for satisfac¬
ings bank investments in equities, their markets are relatively inac¬
The importance of
However, the lessee com¬ tory results.
it seems to me, might well be con¬ tive.
adequate knowledge of the many
fined largely to preferred stocks. panies are usually in a position
factors that must be taken
into
purchase the issues covering
To be sure these securities have to
consideration
in
reaching equiy
more
strategically
situated
been
criticized
occasionally for the
investment decisions and, further^
their allegedly amorphous nature. properties at reasonable prices. At
the necessity for a continuing and
It has been pointed out that they present yields ranging from about
competent supervisory effort in¬
lack
the advantages of common 4V4 % to 5% or more are available
volving trained personnel, suggest
stocks
in
periods of prosperity from guaranteed railroad stocks
consideration of a mutual invest¬
and that in periods of depression of recognized investment standing.
ment company through which sav¬
they may involve to a consider¬
Common Stocks
ings banks in New Jersey could
able extent the disadvantages of
solve jointly their common stock
Even
a
cursory
review of the
junior equities.
In other words,
investment problems at very mod¬
they are neither fish, nor flesh, extensive field of common stocks, erate cost.
nor
good red herring. This may the collective identity of the

equity

should

investments

contract

concept

arbitrary

seeking

banks

objective

sole

the

that

savings

dividends.

emphasize

sible

lease

These

■
subject to mind, a substitution of dividend
It is my least intention to under-for interest income is desired.
controlling condi¬
rate the ability of savings bankers
The
characteristics of guaran¬
tions.
In fact, there is reason to
investment
managers,
recog¬
stocks are such that- they as
conclude that they are at present teed
should
be
analyzed
more
as nizing that in many instances sav¬
in process of some revision. The
bonds than as stocks.
Dividends ings bank officials possess out¬
advantage of preferred stocks to
investment competence
constitute a fixed charge of the standing
certain institutional investors un¬

Equities

Banks in

issues, although it is obvi¬

change

Savings

Investment Objective of

on the other hand,
lower than those of
two years ago due principally to
higher prices without offsetting

slightly

are

new

Savings Bank Standpoint
stocks,,

common

satisfactory.
seem
to
ous
that
market
circumstances offer attractive senior equity in¬
surrounding a new issue would be vestments for savings banks, par¬
ticularly
where,
with
Federal
largely influential.
tax
considerations
in
These yield spreads represent income

be increased somewhat in the case

Continued

sition

and

disposition of common

stocks.
I shall not take

the time to dis-

Volume 178

Number 5278

The Commercial and Financial Chronicle

...

(2181)

the

cuss

nized

and to suggest the possibility
interest in the various

ence

generally recog¬
timing techniques

than to refer to their exist¬

your

books

and

articles

constituting a
rather impressive bibliography on
this subject.
Basically, the dollar
cost averaging procedure would
seem to lend itself most appropri¬
ately to the requirements of sav¬
banks

ings

lection, of commercial bank stocks.

several

formula

under

present

$280.3

stocks.

and

Valuation
time

and

investigated

banks

million,

77.1%

accounted

1.11%

total

stocks

for

of assets

equity

hold¬

the New England states sav¬

aggregate book value of $295.7

million,

valuation policies in various states

equivalent to 4.31%
of
while
holdings of bank

assets,

in which savings banks are au¬
thorized to invest in equity secu¬

stocks

rities.

held by the New England savings
banks accounted for 93.3% of their

determined

was

that

general the policy of periodically
writing down such investments to
market

providing adequate val¬

uation

favored

reserves

offi¬

cially and observed in practice.
;

The

York

New

State

Department has issued

Banking
formal

regulations covering valuation

re¬

procedure in connection with

serve

equity

investments

savings

banks

and, as far as I know, has
present intention of doing so.

The Department, however, has is¬

official

sued

that

each

stock

recommendation

bank

savings

making

establish

investments

ther

recommended that profits

transferred to

valuation

and that losses be

charged against
undivided profits or current earn¬
ing^. No ceiling was specified in
the

recommendation.
in

preferred and
V2

reserve

accumulated

My 6wn

20%

suffice

would

annually

total

for

10%

holdings.

such

inclination is to favor a
for the equity ac-

it. ;may

tions

fluctuate

less than earnings
types of corporate enter¬
while banking as a whole

of other

prise,

profits

resulting
likewise

broken

dividend

credit,

while

these

and

power

the

century.

dividends

the

managed

the

instances

some

exceed

their

satisfactory earning

equities

well

records

Assurance

commend

strong

commercial

conservative

and

banks

requirements

of savings banks in

Assets

banks

soundest

very

equity securi¬
are

among

the

consisting

economy

the

country's

mainly

cash,

of
and

Treasury
obligations
self-liquidating loans. In a period
of

receding

business

activity

decline

in loans will be offset by
expansion in holdings of Treas¬

ury

obligations,

yields

although

such

the

obligations

will

usually be somewhat less than the
returns

riods

loans.

However, in

of recession,

pe¬

Treasury defi¬

Association

Insurance

Commissioners recommended that
life insurance companies set

of statement value

amount of

such
equivalent to 20%.
annually

until

would

until

has

been

seem

reserves

sound

are

practice

adequate equity reserve
accumulated to value

holdings of such securities at cost
net depreciation.
To the ex¬
tent of the inadequacy of the re¬
less

serve,

bank

the net sound surplus of the
would
be
reduced.
Ulti¬

mately, with

adequate valua¬

not

have

the

defensive character, though, and
consequently appear desirable for
conservative investment in a pe¬
riod

stock

common

aside

against
preferred
and
investments in

reserves

volatility nor the potentialities for
with
appreciation of most other junior
1951 The
equities. They possess a stronger

charged

Incidentally,

losses.

National

stocks

Bank

and

sales

from
be

shown

has

pally

from

underwriting

steady

IIMF, Inc. is vested in
of

Directors

furnished

are

Trust
owned

The retention of

payments.

earnings has increased capital re¬

tion

consisting

of
Invest¬

banks.
other

equity

though
been

competent

IIMF, Inc.

principal

mutual

this

reinvestment

Consistent

sources.

it must un¬

prices.

historically high stock
Yields are relatively at¬

tractive.

Average

market

yield

for

son

tion

investment pro¬
mutual savings bank.

ministered equity
gram
.

for

Commercial

Bank

banks

Stocks
play an

in¬

dispensable role in a modern cap¬
italist economy. Inclusion of com¬
mercial bank stocks in the equity
investment
powers
for
savings
banks
recently
enacted in
the
State of New Jersey evidences a
*

justifiably
market.
ence

states
'

constructive

savings bank.

most

sensitive
the

this

The

desirability, subject to careful se¬

However, in
and

exposed

securities

tory record is to be

se¬
po¬

market

reasonable

assurance.

I close with

appropriate ref¬

to the profund

erence

observatio

of the

Massachusetts court in th<2
opinion in Harvard College v

favorably with current
from many high-grade in¬

compares

returns

dustrial

stocks.

Dividend

tion is indicated

protec¬

by the low

aver¬

distribution of about 55% of
net income, while available earn¬
ings suggest the possibility of in¬
age

creased
as

dividends.

the

case

Furthermore,
with other equities,

the

favorable

insurance

market

stocks

ac¬

Utility Securities

Fund, Inc.

By OWEN ELY

the initial

1953 marked

offering of shares in IIMF, Inc.,
investment

mutual

viding

medium

of joint invest¬
stocks

banks

ings
The

Fund

than

for

York

New

amounts

now

sav¬

State.

participa¬
tion of 61
savings banks. IIMF,
Inc. was organized under the New
York Stock Corporation Law, and
in

$5 million with

with

conformance

ment

the

Company Act of

Invest¬

it is

1940;

registered with, and subject to the
regulations of, the Securities and

Exchange Commission, and it is
also subject to regulations of the
New York State Banking Board.
The company is expected to

ify

with

the

Revenue

Bureau

under the

Code

qual¬

of ^Internal

Internal

Rev¬

regulated manage¬
ment
company
and as such to
enjoy the special tax position ac¬
corded such companies. This pro¬
enue

vides

nual

income

effect that if 90%

will

an-^

gains is distrib¬

shareholders, the

company

be taxed only on the income
As to capital gains, the

retained.

will be taxed only

company

amount

capital

gains

distributed

the

Dividends

retained.

and

the

shares of the company will be tax¬
able to

the

same

shareholding banks to
as any other cor¬
or capi¬

extent

porate dividends received
tal

gains realized.

Underlying the
this

investment

recognition
nomical

organization

medium

and

versified

of 1,000 or more.
The principal industries are
products, ships, textiles, rayon, cellophane,
nylon, food
products, chemicals, paper, pulp, wood
products, metal products,
machinery, stone and clay products, and trunks and bags.

The

company has 16 small hydro stations nut these
supply
only about 4% of total output, while about 5% is
purchased (net
interchange including Southeastern Power Administration). There
are a large number of steam units
at nine locations, a few of the

units

being quite old.
Of
capacity, a little over half

company

was

small

828,000

the

of the electric utility
the last ten years.
In

for

plant represents property installed

the five years 1948-52 the
company expended

construction,

including

expenditures for this year

tentatively

company

$48
are

expects

million

estimated

spend

alty company stocks
relatively
low,
the
stability

this

as a

class

are

pronounced
its

strongly established growth char¬
yield

savings

justified such

bank

relationships.

Insurance

companies are pri¬
marily engaged in the underwrit¬
investment

approach to the
problem of common stock invest¬
ment

by mutual savings banks of¬
advantage of qualified
supervision in a highly specialized
the

field

vested.

low cost per dollar in¬
a device of which, it

It is

to me, the merits should be
carefully appraised and the bene¬
underwriting fits duly weighed prior to em¬
activities they are essentially in¬
barking upon a program of in¬
vestment companies. The predom¬ vestment in common
stocks.

and

funds.

inant

reinvestment

Apart

feature

for the

the

seems

available

insurance

Final

responsibility

for

East Coast Electric

Company properties). In addition the
is currently offering 558,946 shares of common (to yield

company

bringing the total number of shares

construction

financing

another

stock

common

proceeds

aggregate

may

accordance

$35

million,

with

to 6 mil¬

the

which

estimates,

include

may

offering.

Pro

forma

proximately

capitalization,

including current financing, is

ap¬

follows:

Funded

debt
stock

Common

stock

$173,000,000
49,000,000
* 106,000,000

;

equity

(6,000,000 shs.)

53%

$328,000,000

Preferred

^Excluding-

100%

The

million

company

has enjoyed good growth, current revenues of

million being 65% larger than in 1948.
Electric output is
currently running about 10% over last year, with share earnings
on

stock

common

Earnings
shares

for

the

increasing at the
months

outstanding,

now

rate of about IV2C a
Oct.

ended

$1.74

is received
In

its

base of
would

ber

31,

pro

latter amount would be increased to $2.10

1953

were

month.

$1.92

forma basis, and the
pending rate increase

anticipated.

application the company used a net electric rate
as of June 30, 1953.
The increase requested

rate

$360 million

provide about $4.8 million additional revenue per annum,

The

shares.

Jan.

effective

but

share after taxes on the increased num¬
asked for the increase to become

company

this

appears

now

doubtful, since hearings

at that time. Even with the increased
rates, the return on the rate base is estimated at only about 5.75%.
may

still

progress

earnings record in recent years, on

The

the end

of each period,

has been

$1.90

1952

$1.74

At the recent
colic

shares outstanding at

follows:

-Calendar Year-

12 Mos. End.

Sept. 30, 1053

on/4

opera¬

intangibles.

$83

from

the

and

million

To finance this program during the period from Jan.
1, 1948
through Sept. 30, 1953, the company sold $92 million bonds, $20
sinking fund debentures, and $20 million preferred stocks,
and obtained $44 million from the issuance of
2,503,000 shares of
common stock (in part through sale of convertible debentures that
were later converted, and
through issuance as part consideration

equal to about 36 cents

collective

fers

million
$45

tify its existence.
The

$42

Construction

million

1954

equity

business and

acteristics have long

average

$186 million

1952.

around

year.

would
not as a practical matter provide,
investment
powers
for
savings nor could it afford to provide, a
banks in New Jersey include a
quality of analytical and super¬
provision covering stocks of in¬
visory effort comparable with that
surance
companies.
While
the which a mutual investment com¬
dividend yields of fire and casu¬
pany would have to offer to jus¬
I note with approval that

kw. name-plate
postwar period, and

the

On the basis of net plant
heavy write-offs on the older plants)

74%

size—could

present
built

one-fifth in the early 1940's. fThe
company has an additional/290,000 kw. capacity (including 100,000 hydro at Roanoke
Rapids)

significantly di¬
in
investment
leading
supervised

the
was

scheduled for completion
during 1954-55.
investment (presumably after

stocks

common

communities

tobacco

lion.

of the desirability of

from

a practicable and eco¬
vehicle
through which
banks—particularly those

benefit

and Power operates in most of
Virginia and
parts of West Virginia and North Carolina. It
also distributes
natural gas in Norfolk and
Newport News. In the 12 months ended
Sept. 30, 1953 electric business provided 95% of
revenues
and
gas 5%.
Electric revenues were obtained
92% from Virginia, 7%
from North Carolina and
1% from West Virginia. The copulation
served is estimated at
2,300,000, about two-thirds of whom reside
in

about $15 million)

establishing
savings

Virginia Electric

without

computed

regard to capital
uted to

Virginia Electric and Power Company

pro¬

company

common

ment

the capital is at hazard."

the

over

Public

May 1,

will,

you

company's over-all defensive posi¬

Institutional Investors Mutual

principal New York City bank
shares approximates 4.6% which

attitude ing business and in the

segment of the stock
investment experi¬
of savings banks in other
has clearly established the

toward

asset;

necessary steps to cope with spe-'
rial problems and characteristi:
risks should be taken if a satisfac

tentialities foi< growth and
promise
of higher returns have
been in¬
cluded in the portfolio. 'The cur¬

years.

•

avoidably be given the thoughtful
attention that it deserves as an
essential element in a soundly ad¬

rea¬

staff
with
specialized
further provision for the advantage of dividend income trained
•depreciation might be considered for a savings bank the undistrib¬ knowledge, and at the same time
unnecessary.
Under these condi¬ uted net earnings of which are avoid many of the difficulties and
associated
with
common
tions valuation would be cost less subject to federal income tax is risks
stocks.
reserve.
Whether this matter is obvious.
To put it bluntly and succinctly,
one of law, regulation, or institu¬
Insurance Stocks

determination,

equity

within the limits

percentage

tion reserve,

tional

stand¬

has

emphasis

yield

the

Al¬

upon well protected
representative of the

book

from

area

so-called

rent

the

should prove a constructive factor
in the investment program of a

placed

dividends

should

approaching

supervision

even

small

obviously
policy in

markets

portfolio

pany.

objective

review the

that

point of savings bank investment..
Subject to initial selection an J

perform the duties of investment
adviser for the investment com¬

operation of

points

considered

and
objectives of savings
banks, it is in a unique position to

major

have attempted to

principal

ments

Satisfactory income

probably approximate

1
Conclusion

services

Savings Banks
Company which is wholly
by savings banks in New

York State.
Because of its close
affiliation with savings banks and
its conversance with the
require¬

the

would

80%.

defensive industries,
the reinvestment of
lective investments
involving
profits and of in¬

vestment income in excess of divi¬

dend

acutely affected by the ebb
and
flow
of
business
activity.
Many institutions have long un¬

cit financing through the commer¬
quate for common stocks.
Over cial banks will expand demand
all, it would probably meet the deposits and earning assets in the
test of adequacy.
Obviously such form of
Treasury obligations.
.-a reserve should be credited with
ishould

companies

growth accompanied by a rise in
invested
assets resulting princi¬

is less

excessive

somewhat

withw respect to preferred and
.guaranteed stocks, it would prob¬
ably be commensurately inade¬

income of insurance

Investment

officers of savings
ment
advice and

liquidating value—a cardinal

•cbunt accumulated at the annual
1% recognizing that while

growth in stockholders' equity,

reserve

rate of

industry in

financial condition.

ability of earning power. Earn¬
ings of capably managed institu¬

guaranteed

stocks

the

to
to
sound

established continuity and depend¬

Reflecting the admittedly lesser
risk

million,

Bank

ties.

stocks, it has been suggested that

tory authorities have seen fit
adjust rates when necessary

tion

board

holdings of
common
banks have long been recognized
stock is 5.12%.
of
Giving Amory in 1830, ; which was the
underwriting
profits and of
effect to a small
as among the
highest grade stock earnings in excess of dividends
holding of short wellspring of the rule of
pruden.
term
investments principally because of has
Treasury
resulted
in
a
obligations
the investment: "Do what
compounding

reserve

$276

equity investments.
Equities
of
the
commercial

the end

accounting period; it fur¬

of each

assets.

total

at least 1% of investment

serve of

cost computed pro rata at

amounted

4.02%

re¬

long-term

recognition of the vital
importance of insurance, regula¬

ings banks held stock investments

and

reserve

been

ues.

maintain

Investment

Committee of the New York Asso¬
ciation

total,

ings.

Reserves

the

ago

this

commercial

operating toward their
respective objectives in common

Some

has

assets.

condi¬

tions

business

these securities account growth. Underwriting volume is
impressive preponderance closely related to the expansion
of all equity investments of mu¬ of industry and to the increase in
tual savings banks.
capital values. Neither individuals
As of Dec. 31, 1952, the latest nor corporations can afford to risk
date for which composite figures loss of assets through fire or other
are
available, mutual savings hazards with.-,.tfie result that
banks of this country held equity growth of insurance in force will
securities at book value of $363.4 continue a secular trend in paral¬
million, equivalent to 1.44%
of lel with the rise of insurable val¬
fact,

for

shout,

1951

$1.65

1949

1950

$1.86

$1.67

1948

$1.19

price of 26%, paying $1.40, the stock yields 5.2%
14.1

times reported earnings.

Commercial and Financial Chronicle

The

...

Thursday, December 3, 1953

(2182)

themselves

Continued from first page

what he can do about

see

much

have

doubtless

say

it. And the plaintiff will
with truth about foreign

about various

when he

and they include

international trade are worldwide,

to free

income

things besides tariffs. We should most heartily wel¬
come efforts not only in Washington but in other capitals
of the world to permit, not to say stimulate, much greater
freedom in the movement of goods across national boun¬
many

indeed imperative that ways and means
be found to begin at an early date the removal of the
multiplicity of barriers now blocking normal international

About

$3.23

While Britain depending in substan¬
tial part upon our generosity experimented with socialism;
while France, confident to help from the United States,
indulged in the luxury of internal strife and flirtation with
Communism; and while various other countries for various
reasons waited, and hesitated and hoped, West Germans

ter year

really went to work!

are

level

264

far as we know, has not been
matched anywhere in Europe
Total industrial production in Western

record! at home which, so

the

since

nearly

even

war.

Germany in 1952 was more than two and a quarter times
that of 1948! There was less than a 20% increase in the

Kingdom over the same period. The record in
is better than that of Britain, but far below that

United
France

of West

Nowhere among the

Germany.

countries

find

can

change

even

so-called OEEC

reasonably com¬

parable with that of Germany—and these
course, include Italy, Greece, and various

countries, of
others whose

production suffered severely during the war and whose
production rate had not reached a high level by 1948.
This unique record of Germany is not one which results
solely from an exceptionally low base
Progress Since
West German progress

period of calculation.

1950

since 1950 is also impressive.

production in that country in 1952 was 28%
the 1950 rate. The nearest figure to that record

Industrial
above

the OEEC countries are for Turkey and Luxemburg
None of the others reached 20% , and two of

among

with 22%.

them, Ireland and Denmark, were not
in

better

these countries'was

results
had

able to do as well

they had done in 1950. Britain could do no
than match her 1950 record, The average for all

1952

11% above 1950. In appraising these

forget that by 1950 West

must not

one

already almost doubled its output as

Germany

compared with

1948.
In its international

relations, Western Germany en¬

credit balance on "current account" (that is an
of exports of goods and services over imports of

excess

goods and services) of well over half a billion dollars—or
equivalent in marks at the official rate of exchange.
As late as 1950, Western Germany ran a current account
deficit in an amount substantially greater than her credit

the

previous deficits were much larger.
outstanding record unmatched anywhere

balance in 1952—and

This, too, is
else in

Europe.

explanation and the significance of this

What is the

astonishing record?
territorial remnant

Here is what must be regarded as a
of a country, perhaps, rather than a

establish¬
targets of aerial bombardments

country. Located in this area were plants and
which

ments

forced

were

classified

the

fore

chemical-industrial company, and
should sell at 10 to 12

ings,

Price, Relative to Bright

Low

districts

early

postwar

visitors said they found
and related ill¬
so short years we find the

populations weakened by malnutrition
land

Yet in

half dozen

humming with productive activity

—

and with a

record of economic achievement which is at once the envy
and the fear of may

What is the

German

other peoples.

people

explanation? The

came

answer

generous America. Britain,
and other countries allied with the United States

might be able to count

herself

Future

sound

distinctly undervalued. "Value
places it with a mere dozen
(out of over 550 is¬

Line"

listed stocks

trade

known

around
50 in the East, "Mrs. Karl's" in
Investment
waukee, and "Blue Seal" in
Funds regard it highly, and after
falo. "Dolly Madison" is the
careful
study
of
its
products,
pany's trade name for cakes
progress and profits,
at least 24 keted
through its territory.
few

been

have an organiza¬

know that you

tion

dedicated

onier

company's

the

cess.

is single-mindedly

that

here

easy

one

our

suc¬

that Ray¬

see

great

com¬

only thinks, but
acts in a
way
to insure lasting
U.
S. prosperity, a
company of
that

panies

whose

the Tutonic

France
against

help. Germany must save

down. When this realization fully permeated
mind, West Germans went to work to save

industry

—

Interstate

Bakeries

slightly
when

under

4%%j

consideration

with

earnings coverage in 1952 of

and

or 6V2
times requirement,
selling to yield 6%, should

appeal to those seeking income
with
safety. Both common and
preferred stock of Interstate Bak¬
eries Corp. are traded in the overthe-counter

market.

com¬

mar¬

100% route dis¬
corftpany through
delivery fleet of 1,656 trucks.
but
4%
of the bread sales

its

to grocery trade, the balance
restaurants. About 40% of the

goes
to

sales

cake

whole¬

through

are

through the
delivery route dis¬

salers, the remainder

company's own
tribution.

not

personnel,

management,

and achievements America can be

the

Over

.five

past

the

years

has spent. $12,500,000 for

company

modernization. Md're than $1,000,000

retained

have

earnings

from

the been spent annually in excess of
shareholder has a good chance of its yearly depreciation of approxi¬
doubling his
investment, while mately $1,500,000. The company
drawing an exceptional yield, over is currently expanding its Glenthe next few years.
dale, California, plant at a cost
of $1,000,000 to provide 100% in¬
LAWRENCE
S. PULLIAM
crease
in capacity. The Chicago
North
Plant
is
being increased
Vice-President and Resident
.

all this,

Besides

Manager,

Weeden & Co., Los Angeles, Calif.
Interstate
I

Bakeries

Corporation

Interstate

Bakeries

Cor¬

poration because it combines three
essential factors for success: First,

75%

cost

modernization

while
Springfield,

$500,000,

the

Illinois, bread plant will be com¬
pleted shortly. The heart of pres¬
ent
day
modernization
is
the

Your

RED

—food; second,

continuous
flow
of
7,200 loaves per hour,
which materially reduces the cost

its operation

of -manufacturing

CROSS

engaged

basic industry

i d

nation-

labor
.

The balance sheet

growth

with

oven

sales.

diver sif ied
over a

traveling

shows

1952

total

ratio

%
of Dec. 31,

capitalization of

with long-term debt
representing
29.6%,
preferred
39%,

demonstrated

equity

extreme capa¬

$6,040,897,

bilities.

Incorporated

the

and

31.4%.

The

consisting

totals

610,884
($1.00 par)

stock

common

latter

stated at $610,884 and earned sur¬

in Delaware in

ferred

$5,430,013.
The
75,000
outstanding $4.80 pre¬
stock (no par) is carried

at the

liquidating preference price

plus

1937, and now

employing
people,

5,000

Lawrence

S. Pulliam

$100

per

share.

31,

Dec.

1952 current assets totaled

operates 24 bakery plants located
in 17 cities in 9 states across the
nation. Nine bread plants

and one

$9,559,-

including cash items

of $5,-

000,

500,000. The latter alone exceeded
current liabilities

total

$3,768,-

are
operated in the 979. The net
working capital was
growing Southern Cali¬
$5,800,000. The current ratio is
fornia territory and account for
2.54 to 1.
35% of total sales volume. Bread
Management attention to waste
plants, in addition to Los Angeles,

cake

plant

rapidly

are

operated in San Diego, GlenLong

Santa

Barbara

Illinois,
two

the

bread

and

Chicago
and

one

Centro. In
area,

cake

elimination

and

efficiency

con¬

Ana, trols, have produced striking

Santa

Beach,

dale,

with

plants,

sults
net

sales

recent

years.

reached

$79,319,519,

13.3%

For

new

re¬

1952,

high

$31.00

tributed by the
All

sales

bread

The

privilege to
meet
President Morgan, and
to
discuss Rayonier with him, and I
has

in the basic and

invested

have

Rayonier.

earnings.

given to the probable increase in
the present $1.00 dividend. Next
year with the demise of EPT, In¬
terstate Bakeries $4.80 preferred

Mil¬
Buf¬

years.

funds

institutional

Excess

stock, available at about

especially

terri¬

the

price-level

within

interested

food

yielding

reviewed) carry¬ tory it serves. The bread is known
ing a rating of "Especially Recom¬ as "Weber's and "Log Cabin" in
mended for Purchase," and fore¬
Southern California, "Butter Nut"
casts

1953,

should have investment attraction,

regularly

sues

for

substantial

6 times estimated net for 1953 and

house¬

are

names

throughout

word

hold

$5.50
the

net

company

conditions

well

INTERSTATES'

program,

those

Common

With¬

per

bakery companies are normally
not affected by adverse economic

V2, instead of up 10 points. Milwaukee, Wisconsin, and Buf¬
Looking ahead, leading statistical falo, New York.
and
advisory services regard it
Due to its quality advertising
of

common.

common

plant,

plant. Theyu also have plants in
be down Omaha, Nebraska, Des Moines,
1953 high Iowa, Grand Rapids, Michigan,

Rayonier should
nearly 10 points from

why

$8,000,000

$2,600,000

expiration

defensive

and

bread

one

growth

reason

BAKERIES

to realize that they had no ground

hope of aid from

Hitler

seems

INTERSTATE

given lately by
one well-informed
and exceptionally well qualified ob¬
server just back from West Germany was about this: Soon
after the end of the war German leaders and many of the
for

for

Outlook
There

indicates

For

contributes 13%
of sales, while Kansas City, Mis¬
souri, the home office of the com¬
pany, accounts for
9% of sales
with its one bread and one cake
cake

one

stock

industry and trade. Throughout many of

income

net

contribute

Addi¬

of sales.

currently, be¬ nati, Ohio, with

45 and 55.

tween

and

Peoria

compar¬

up
to $5,685,067 vs.
Sales volume for 1953

estimated

benefit

located in
Springfield. Cincin¬

third, its man¬
agement has

these

nesses.

least,

times earn¬

the

above

should
approach a new high of
$86,000,000. Earnings before taxes

bread plants are

great deal of industrial relocation as well as re¬
Many other anatomical changes had to be

in both

taxes

$4,985,487.

$19,540,897

habilitation.

8.25%

Profit Tax December 31, 1953 will

20%

accounts for
tional

three-quar¬

half-year period. Profit mar¬
gin widened sharply with net be¬

like Best

high profit-margin,

able

The Security I

Oct.

highest

the

period, totalling $65,252,-

EPT, the
figure would

territory;

made

ended

history for

out

anywhere else in the world. Territorial changes

unmatched

weeks
were

$3.65 per share of

proud.

joyed

sales

with

of German competition

resurgence

share for year

common

the

which

is an
integral part of a broad movement in that country that
deserves much more attention than is generally accorded
it. Western Germany is presenting a more formidable
competition in foreign markets because of a production
matched

per

1953,

fully in Washington.

Continued from page

66.3%

$2,332,598, equal to
share of preferred and

1952,

economic relations.
the

taxes

were

$31.10 per

not be a full explanation of all that
has taken place in West Germany, but no one can doubt
that it explains a great deal of it. And if that is true, there
is much in the fact which ought to be pondered most care¬

dary lines. It is

But

after

earnings,

This may or may

something about the equivalent thereof, and
impediments which are placed in his path
undertakes to ship his goods abroad. The obstacles

dumping,

1951, while earnings before taxes
showed an increase of 47.32%. Net

will and with

organizing to produce.

Something for Us to Think

We See It

with

and went to work

—

typical German skill in

higher than

must carry on I

Volume 178

Number 5278

...

The Commercial and Financial Chronicle

(2183)

The

Indications of Current
Business Activity
Indicated steel operations
Equivalent to—

(percent of

Steel ingots and
castings

Week

capacity)

—Dec.

(net tons)

output—daily average

gallons

(bbls.
1

each)

output

output (bbls.)
fuel oil output

ASSOCIATION

Revenue

oil

Revenue

Total

Private

Public

cars)

CONSTRUCTION

(no.

6,951,000

24,710,000

24,540,000

2,312,000

2,364,000

2,277,000

2,946,000

10,622,000

10,044,000

9,900,000

10,857,000

8,253,000

8,258,000

8,163,000

145,193,000

144,954,000

142,666,000

36.028,000

36,779,000

37,394,000

32,086,000

133,439,000

*134,769,000

132,767,000

*51,194,000

52,633,000

Bituminous coal and
coke

804,413

811,073

665,931

697,470

$244,704,000

$358,366,000

92,246,000

103,123,000
141,581,000

262,008,000
96,358,000

129.149,000

52,850,000
44,334,000

107,074,000
34,507,000

87,888,000
8,470.000

8,810,000

9,275.000

10,518,000

588,000

597,000

682,000

821,000

71,100

*71,400

83,900

92,800

Nov. 21

131

133

113

134

8,138,165

8,416,116

8,361,593

DUN

—

Pig iron

(per

Scrap steel
METAL

(E.

218

127

$56.59

Nov. 24

$55.26

$34.83

$35.33

$34.17

$42.00

24.200c

4.632c

4.634c

4.376c

QUOTATIONS):

tin

(New

York)

29.625c

28.925c

29.050c

28.675c

86.250c

83.750c

35.400c

MOODY'S BOND PRICES DAILY AVERAGES:
U. S. Government Bonds

BUILDING

PERMIT

BRADSTREET,
of

VALUATION

INC.—215

Atlantic

South
East

South

Central

13.500c

19,299,810
66,337,155

United

13.300c

42,701,615

366,858,611

York

City

10.000c

12.500c

COMMERCIAL

PAPER

ERAL

RESERVE

Oct.

BANK

COTTON

(000's

NEW

AND

LINTERS

MERCE—RUNNING

DEPT.

—

96.84

Dec.

109.60

110.70

consuming establishments

110.88

111.07

113.89

107.98

108.34

112.37

105.69

105.86

105.69

109.06

100.16

100.00

99.52

103.80

103.64

103.80

103.97

Dec.

106.92

106.21

106.04

Dec.

109.79

108.16

107.98

112.37

Dec

2.86

De(/

2.87

2.81

3.39

3.19

Dec.

3.13

3.12

3.11

Stocks
Cotton

Oct.

COTTON GINNING
As

CROP

BOARD U.

2.96

3.28

3.26

3.04

3.40

3.41

3.22

Corn,

3.74

3.75

3.78

3.52

Wheat,

3.51

3.34

Winter

3.18

All

Orders

INDEX

3.28

3.04

394.5

408.8

Nov. 21

(tons)

Percentage

Nov!
Nov!
j.—Nov!

activity

orders

PAINT

1949

3.27

399.8

(tons)

AND

DRUG

AVERAGE

end

period

REPORTER

PRICE

193,817

227,846

213,773

205,897

252,244

256,655

262,973

248,614

421,729

480,726

463,706

502,963

21-

INDEX—

100

3.39

ASSOCIATION:

(tons)

Production

OIL,

3.27

406.7

Group

PAPEBBOARD

received

Unfilled

3.38

Group

COMMODITY

NATIONAL

3.52

3.38

-Dec.

MOODY'S

3.53

Dcc"
Dec'

Nov. 27

106.41

LOT

DEALERS

EXCHANGE
sales

AND

SPECIALISTS

SECURITIES

—

by dealers

Number

105.92

Dollar

Odd-lot

purchases by dealers

Number

Customers'

short

sales

Customers'

other

sales

sales)—
sales

Number

Customers'
Customers'

short

Round-lot

Other

Round-lot

179

183

119

21,143

18,064

19,264

618,214

521,120

543,012

5,729

6,075

5,896

3,949

612,139

515,224

539,063

;

-Nov, 14

——.—

$21,455,008

$23,400,649

$20,106,330

$22,128,328

184,710

192,500

153,190

144,590

——Nov. 14

ACCOUNT

Round-lot

STOCK

Othc-r

SALES

THE

STOCK

MEMBERS

NEW

226,120

271,040

ODD-LOT

255,460

317,530

6,224,480

6,696,720

4,748,390

6,643,500

N°v.

6,479,940

7,014,250

5,047,770

7,047,560

FOR

ACCOUNT

purchases

299,380

404,060

MEM¬

Nov.

————

—

668,950

744,230

544,350

826,350

122,680

135,440

113,500

225,980

517,230

552,930

426,070

652,980

7
on

seed

31,755

4,911

5,147

17,730

16,777

252,276
1,427,155

3,347
259,483

291,682

1,393,995

1,354,010

373,939

2,610

347,504

33,709

28,292

2,045,875

2,032,557

2,254,855

7,525

(tons)

7,525

7,599

11,557
(bushels)——

crop

11,496

10,160

41,752

'—

—

41,752

61,263

94,064

99,611

92,489

63,894

63,429

62,560

29,135

30,374

30,947

2,749

2,773

3,173

230

———_—

214

177

——

1,209

1,075

790

184,962

185,132

147,946

13,852,000

*13,656,000

13,069,000

8,050,000

*8,038,000

7,332,000

5,802,000

*5,618,000

5,737,000

(bushels)
(tons)

Cherrj.es

(12

(3 States)

639,910

688,370

539,570

238,020

221,210

145,950

153,970
36,400

the floor—

purchases

States)

—

(tons)
(tons)

States)

(barrels)

(pounds)

218

AND

—Nov.

PAYROLLS—U.

LABOR—REVISED

DEPT.

SERIES—Month

August:
All

manufacturing

Durable

(production

goods

workers).—

goods
Indexes

(1947-49

manufacturing
Payroll Indexes
(1947-49

878,960

Totd<l

initiated

and

—

Avge.=l00) —

All

Nov.

sales

transactfons

10,935
42,438

33,464
:

(bushels)

Employment

which registered-

Nov.

sales

12,477
43,462

30,299

370,856

—

(pounds)
Apples, commercial

83,316

15,136
104,424

4,911

(bushels)

Hops

Nondurable

DEALERS AND SPECIALISTS:

specialists in stocks in

105,563

17,557
3,347
—

(tons)

114,590
15,596

43,462

___

Cranberries

16,093

15,910

30,299

(tons)

(pounds)

EMPLOYMENT

TRANSACTIONS

BERS. EXCEPT

beans

(pounds)
Sugarcane for sugar

Pecans

-Nov.

Other

230,400

48,660

12,477

Apricots

—Nov.

—

Short

144"! 5 90

31,002

51,328

(SHARES):

sales

Transactions

153,190

YORK

ROUND-LOT

190,780

192,500

227,008

17,452
39,011

105,563

—

timothy

(bushels.)
Sweetpotatoes (bushels)

Pears

237,476

116,621

____

—

(tons)

beets

1,268,280

52,628

(bushels)

Tobacco

Sugar

1,205,106

17,452

____

for

21,363

217,283

39,011

Potatoes

TRANSACTIONS

—

sales

—

bag)

and

238,646

13,424

271,476

1,205,106
237,476

lespedcza (tons)
Beans, dry edible (100 pound bag)
Peas, dry field (100 pound bag)
Soybeans

284,900

3,306,735
1,291,447
1,052,801

13,424

(tons)

alfalfa

Grapes

sales—

sales

Total

184,710

Nov. 14

ROUND-LOT

wild

clover

878,331
284,900

271,476

(bushels)

(tons)

Peaches

Nov. 14

Short

Other

550,463

Nov. 14

sales

—

ROUND-LOT

Total

168

19,365
556,192

—..Nov. 14

sales—:

—_

1,163,231

878,331
—

3,196,101

1,163,231

(bales)

all

Peanuts

—Nov. 14

EXCHANGE AND

Total

19,383

purchases by dealers—

Number

FOR

18,247

dealers—

sales

Total

21,322

—-----—Nov. 14

sales

TOTAL

19,533

sales

shares—Total

Short

22,637
648,337

$28,623,489

Nov. 14

sales

Number

19,206
564,675

$24,127,498

—v.—-Nov. 14

sales—

other

21,501
639,953

$27,813,028

value

Dollar

19,197

565,869

$25,189,730

——-—L.—L-L1.—Nov. 14

shares—Total

3,180,430
___.

(bushels)

grain

10,807,206

thousands):

(bushels)

(100 pound

Hay,

(in

(bushels)

Sorghum

107,900

REPORTING

Hay,

Nov. 14

(customers'

orders—Customers'' total

Flaxseed

711,173

20,188,000

121,971

OF AGRICULTURE—

(bushels)

1,041,594

20,030,000

10,787,521

DEPT.

spring
Oats
(bushels)
Barley (bushels)
Rye (bushels)
Rice

123,614
1,156,487

(bushels)

spring

Hay,

.Nov. 14

——-——

all

915,568
1,300,832
6,753,266

19,953,000

(bushels)-

Durum

Hay,

-Nov. 14

———

—

702,425
1,296,811
5,852,917

OF COMMERCE)-

CROP

—

November

all

Other

Hay,

STOCK

—

value

109.24

COMMISSION:

purchases)

orders..——

Number

EXCHANGE

(customers'

Cotton

106.16

STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODD-

Odd-lot

Oct.

PRODUCTION

3.29

(DEPT.

November

3.41

Dec

1,506,192
9,406,484

Oct.

spindles active

Dec.

872,128

storage as of Oct. 31
Linters—Consumed month of October

Dec.

Baa

Industrials

$591,000

2.72

3.39

AVERAGES:

Lint—Consumed month of October

Bonds

Railroad Group
Public Utilities

$475,000

COM¬

public

107.80

corporate

BALES:

95.61

Aaa

$540,500

YORK—

omitted)

106.04

Utilities Group
Industrials Group

Average

$1,235,300

OUTSTANDING—FED¬

Dec.

DAILY

34,304,009
355,756,979

$390,060,988

CASH DIVIDENDS—PUBLICLY
REPORTED BY
U. S. CORPORATIONS — U. S.
DEPT. OF
COMMERCE — Month
of
October
(000's

Dec.

YIELD

381,496,084

$535,000

City

New

$420,200,128
38,704,044

13.800c

10.000c

87,422,481

$409,560,226

States

$15,982,982
72,483,788
35,742,737
91,666,219
58,270,660
32,199,308
11,657,832
72,057.462

$553,000

York

Outside

14.000c

13.300c

81,114,403

45,990,216
96,190,676
50,434,647
29,246,394
11,743,728

67,283,622
31,000,477

Mountain

.—.Dec.

BOND

$18,057,583

83,880,794

43,973,129
76,911,547

Atlantic

Central

94.67

Group

U. S. Government

232,996
99,354

CITIES—Month

106.04

Public

MOODY'S

DUN

—

England

94.95

___

Baa

124,425

September:

106.04

Railroad

419,350

332,523

S.—

Aug.:

etc.

Dec.

-—;

All

sales

Nov.

10,800

20,400

Other

sales

16,470

Nov.

181,550

209,050

Nov.

128,330

192,350

229,450

144,800

196,750

purchases

Nov.

262,330

sales

286,500

Nov.

182,447

260,747

32,710

29,550

33,600

280,315

216,809

285,075

*110.4

105.7

151.7

*149.1

134.2

17,253,000

*17,055,000

16,280,000

number

of employees in manufac¬
industries—

turing

manufacturing

Durable

45,050

224,200

112.0

Average= 100)—

manufacturing

Estimated

All

Short

Total

Other

sales

transactions

Total

Short

initiated off the floor—

sales

Other

NEW

CAPITAL ISSUES

MIDLAND

256,910

309,865

252,409

330,125

purchases

Nov.

1,169,300

Short

sales

1,251,940

Nov.

872,747

166,190

1,241,067

185,390

Other

sales

Nov.

163,570

307,430

922,980

1,042,295

773,209

Cash

1,089,170

1,098,405

1,227,685

936,779

1,405,835'

Total

^slos

WHOLESALE
LABOR

—

(1947-49

NEW
=

SERIES

Revised

of Jan.

Nov. 24

110.0

109.8

110.0

95.0

93.2

Nov. 24

94.3

(000's

Credit

103.8

103.9

104.3

£16,795,000

£8,011,000

£3,940,000

$1,315,863

BRITAIN-

EXCHANGE—As

margin

carrying

customers'

extended

GREAT

9,142,000

7,138,000

Oct—

Oct.

omitted):

firms

Total

*9,991,000

*7,064,000

hand

and

customers'
value

value

debit

net

accounts—
balances

$1,640,628
31,100

*$1,625,074

S.——

288,619

295,404

343,722

balances—

674,408

673,578

692,017

!15,428,148

100,349,123

customers
in

banks

free

listed

borrowings

Member

borrowings on

credit

33,553

30,640

bonds———

94,571,815

110,478,753
93,472,388

U. S. Govt, issuesother collateral

101,133

106,026

106,402

1,159,588

1,122,306

912,280

$38,406,800

$16,543,500

112,151,693

101.7
104.5

84.8

84.5

87.0

Nov. 24

96.2

114.6

113.0

([Includes 621,000 barrels of foreign crude
against the Jan. 1, 1952 basis of 108,587.670

figure.

1, 1953 as

STOCK

Market

_Nov. 24

other than farm and foods

—

LTD.—Month

Member

Nov. 24

—

foods

commodities

YORK

BANK,

Market

Meats
All

products

Processed

DEPT.

100):

Commodity Group—
All commodities
Farm

—

NEW

Member

—«

PRICES,

10,004,000

7,249,000

goods

160,350

Nov.

Total round-lot transactions for account of members-

goods

Nondurable

Nov.

Total sales

alterations,

Dec.

corporate

Aaa

$751,700

427,115

$20,873,692

U.
of

Dec.

Average

$884,063

107,954

THE

building construction
residential

121.500c

13.500c

13.300c

Nov. 25

13.500c

Nov. 25

Louis)

80.000c

Nov. 25

Lead (New York) at
Lead (St. Louis) at
(East St.

29.675c

Nov. 25

27,858,000
$449,429,000

417,423
275,264

LABOR—Month

omitted)
Nov. 25

Nov. 25

;

37,669,000

$514,941,000

$800,640

AREAS

nonresidential

copper—

Export refinery at

Zinc

223

Nov. 24

Domestic refinery at
Straits

173

Nov. 24

34,103,000

URBAN

New

ton)

iper gross ton)

PRICES

Electrolytic

shipped between

7,869,000

omitted);

Total
Nov. 26

lb.)

gross

All

COMPOSITE PRICES:

(per

and

Pacific

INDUSTRIAL)

30,393,000

7,701,176

Nov. 28

AND

BRADSTREET, INC
steel

DEPT.

West

INDEX—FEDERAL RESERVE

Electric output (in 000 kwh.)__

Finished

Middle

8,850,000

EDISON ELECTRIC INSTITUTE:

FAILURES0 (COMMERCIAL

32,348,000

65,703,000

CONSTRUCTION PERMIT VALUA¬

TION

New

100

—

countries

BUILDING

73,876,000

Nov. 21

credits

stored

$516,722,000

33,450,000

Nov. 21

AVERAGE

foreign

40,426,000

8,516,000

Nov. 21

SYSTEM—1947-49

28,826,000

55,708,000

$203,025,000

MINES):

(tons)

DEPARTMENT STORE SALES

goods

Additions,

$145,096,000

Nov. 26

lignite

warehouse

New

(tons)

$237,182,000
134,767,000
10,794,000

$237,106,000
113,855,000

10,052,000

45,477,000

exchange

Based

(000's

627,565

Pennsylvania anthracite (tons)

Ago

144,720,000

shipments

Dollar

52,081,000

Nov. 26

BANK

31:

117,834,000

50,494,000

Nov. 26

BUREAU

October

Year

Month

Total

Nov. 26

123,885,000

7,076,000

23,842,000

633,812

municipal
(U.

YORK—As

8,885,000

6,830,000

23,615,000

727,058

Federal

of that date:

OUT¬

$226,662,000

Domestic

Nov. 26

and

NEW

Domestic

cars)__Nov. 21

ACCEPTANCES

FEDERAL RESERVE

—

Exports

117,066,000

ENGINEERING

—

DOLLAR

6.662,550

6,224,350

725,732

construction..

COAL OUTPUT

IRON AGE

2,180,000

Nov. 21

construction

Beehive

2,096,000

are as

Month

BANKER'S

STANDING

RAILROADS:

construction

State

105.0

6,219,250

Nov

of quotations,

cases

Ago

93.0

Nov. 21

(number

or,

either for the

are

Latest

Nov

freight received from connections

ENGINEERING
NEWS-RECORD:

Ago

Dates shown in first column

that date,

Year

Nov!

OF AMERICAN

CIVIL

Month

6,259,150

Nov

(bbls.)

freight loaded

month ended

production and other figures for the

cover

Imports
Nov. 21

(bbls.)

fuel

*1,956,000

month available.

(bbls.)

average

""slriual fuel oil output
(bbls.)
Nov
Stocks at refineries, bulk
terminals, in transit, in pipe lines—
Finished and unfinished
gasoline (bbls.) at
Nov
fc-erosene
iodIs.) at
Nov
Distillate fuel oil (bbls.) at
Residual

§1,956,000

*86.8

Nov

stills—daily

Kerosene

Previous
Week

§86.8

—

Gasoline
Distillate

Dec.

AMERICAN PETROLEUM INSTITUTE:
Crude oil and condensate
Crude runs

week

Latest

AMERICAN IRON AND STEEL INSTITUTE:

following statistical tabulations

latest week

runs,

tons.

§Based

new

annual

capacity of 117,547,470 tons

TREASURY
RECT
OF

MARKET
AND

TRANSACTIONS

GUARANTEED

IN DI¬

SECURITIES

U. S. A.—Month of October:

Net' pS'rchaVer::::::::::::::::""----------

1953

Financial Chronicle... Thursday, December 3,

The Commercial and

(2184)

necessity

Economics and the Engineer
the most likely value
the dollar when the machine is

jhammering it with a sledge ham-

currency

Dupont,

Pierre

Lavoisier,

off

anger?

sured

Intelligent Action

economics?

is because

live

nomic

drink,

him
add

telligent action. Without a stand¬
ard of value by which to compute

that

The

without

engineer is

the

The

It's as if the
chemist were to be deprived of his
"balance, or the mechanic were to
be
deprived
of his
measuring

particular process,

-scales.

tool

one

We do

How do we decide?

other?

by trial and error and assess
economic consider¬
We total up the man hours

jSO

the results by

when

under John Sherman.

budgetary

work, at the rates of pay to
the capacities of free work¬
entitle them, we add the other

costs, such as electric power,

riod

That sum

compared.

esses

materials

expressed in units of a common
denominator, called the dollar in
the United States.
The products
is

are

is compared and
replacement of the

for

-equipment when it becomes use¬

out or by obso¬

less, by wearing

lescence, are all expressed in dol¬
lars. To those of us who have to
deal with

evaluation of risks the

mathematics of probabilities
also

must

applied.

when as at pres¬
standard of value—the

What happens,

the

ent,

yardstick or measure of all

has

been steadily deteriorating, having
lost
about
half
its
purchasing
.

in the United States in the

power

past 10 years and 90% or more
many

And more¬

nations abroad?

because of steeply graduated
income taxes one dollar earned

over,

one

person

concern

is not

equivalent to a dollar earned by
another person or concern because
variable percentages of that dol¬
lar
are
taken away
in income
taxes?
We mechanical engineers
have all had experiences where
we can show that a machine will

for itself in five years in shop
costs, but when earnings from the

pay

use

machine

that

are

taxed at

*70%, the management must take
into consideration that it will re¬

quire
tained

years to pay for
30-cent
dollars

16%

machine

after

The

taxes.

then becomes affected by
Of chance.

What

are

the
re¬

equation

the laws

the chances

that taxes will be lowered during

period

of useful

Excess Profits Taxes

liuring

the years

life?

Will

be in

effect

of useful life?

No,

pressed

comprising the

the

theory

special

which free citizens can rely;

upon

case.

revealed show that among the

the

visors

ad¬

Communists in high positions.

off the gold

We were not forced

abandoned

deliberately

istration

resulting system met
of and has been
by the Communists who

the

and

with the approval

furthered

infected

have

Government

our

particularly in the U. S. Treasury.
There was more gold in the U. S.
Jan.

Lenin as hav¬

been

had

(the

any

1933 than there
month in 1929

from $3,828,000,$4,094,000,000) when it had

range

000 to

supported

was

very

gold

certificates

than

better

may

other

any

the

only

the

under

which

and

redeemable

heart

oratorical

for

relate

com¬

purposes

circumstances
gold standard
currency

store of value

protect our women
and children. They need that pro¬
tection. But so do the children of
birth pangs

the

How

new

of inventions
jobs come up ire

town? Very often it's the rean
invention.
Sometimes

your

gold;

know

members

Our

mind.

the

into gold

They wanted cash, not

coin.

experience throughout his¬

all

pelling

very

with art

you

tory has shown.

There

little drain on the U. S.
Treasury by U. S. citizens' con¬
version of Federal Reserve notes

was

bore

not

functions
as

high amount of

credit and sustained prices.

shall

analysis of reasons why the gold
coin standard meets the require¬
ments of each of the above six

The Roosevelt Admin¬

standard!

it;

currency.

Government,

close to the President, were many

definite weight of
precious metal. Napoleon, whose

the

suit

the consequence of

what we

is,,
If

call an innovation, that
trying something brand new.
may

inventor

the

has

innovator

works

dropped

men,

did

which

'invention'

not

produces Calculation in a Socialist So¬ denying the same protection to the laws of nature would not
the U. S. citizen whose toil, in¬
stability. The average number of ciety," shows that even Socialist
work.
But
before an invention;
unemployed in each year from societies have to reintroduce genuity and risk-taking caused has been made the steps were not
the gold to be in the Treasury in
1934 to 1939, inclusive, never was
prices and concepts of value in
logical; had they been so, some¬
less than 7,700,000 (in 1937) and order to organize production and exchange for the products of his one else would
long before have
able

paper

even

currency

late

the

1939

unem¬

ployment was still 9,500,000. Fail¬
ure
of more substantial recovery
to

occur

had not

what

such

for

long

happened since the some¬

similar

experience in 1873-

Especially is there no sense
discrimination when the

work?

distribution.

this

What Happened to
Since

period

the Dollar

evidence

1933

can

Having mentioned a few of the
difficulties arising from the kind

shows

the

that

citizen has shown more trust

in his Government than

of monetary and

taxation systems
are living, let's

eign

central

banks

have for¬

and

govern¬

Their percentages

ments.

drawals

conditions.
habit

Gambling

instead

becomes

sensible compu¬

tation of calculated risks in
ness;

busi¬

unproductive gambling be¬
a
national abomination in

1934.

ury
so

On Nov. 10, 1953 our Treas¬

had lost $1,261,000,000 in gold

drawn out over the amount

gold acquired during the past 12
months.

tions

which the people

would

get

back

the

funda¬

mental unit which appears as

the

economic
countries
undergoing
monetary
inflation. Meanwhile, only a few cipal members of the Committee equation which we engineers have
wise
and
honest
men
devote for the Nation, aided chiefly by to make; that figure is preceded
It

was

the

advice

of prin¬

When

steel

right hand side of any

molten

pig

lier

his

considerable

saved

of bronze paint.

Autobiography":

and

deliberate

whole

the

continue
had

cial

his

well

cess—there

case

He says

were

consideration
I

resolved

process
as

ear¬

manu¬

"After

researches

made my
as

make

blowing
air
through
iron he had already-

inventions, notably the

full
of

of money by use of

facture
in

practicable

and

earned
sums

in 1856>"

Henry Bessemer

believed

until

duties

myself and'to

Having

thought

to>

commer-

scientific

owed to

which

I had to

settle

000)
so

thoroughly over
opposition

fight, I came to the con¬
it was my duty to
sum
of £10,000 ($50,-

that

wife, under trustees;

that I could not be ruined ab¬

solutely in further pursuit of my
invention

family., i

the
on

sue-!

the risks and powerful

clusion

not approve.

Let's

taken them."

Ameri¬

of with¬
during the period be¬
under which we
tween October. 1931 through June,
the charts of objective economists get back to the fundamental unit,
1932 ranged from 8.15 to 15.83%
recording the failure of the paper- the dollar. At present and since
March 6, 1933 it has been forbid¬ of our total gold stocks and that
money plan in peacetime condi¬
involved a very high percentage
tions
to
reduce
unemployment den for Americans to own or use
of their total claims against our
gold or gold coins for money. Yet
permanently and substantially.
gold. Those in authority in any
we continue to make good to for¬
Confused by all this, manage¬
Administration Who fear that the
eigners. through central foreign
ment and more importantly, the
redeeming
their dollar people would refuse to leave their
investors
they represent, either banks,
Treasury if they
credits on the U. S. Treasury at money in the
refrain from making investments
the fixed rate of $35 per ounce of were free to convert it into gold
or wishfully gamble upon "some¬
gold as established on Jan. 30, coins are pointing the finger at
thing turning up" to improve their
themselves as contemplating ac¬
Only the harsh remedy of war
obscured those tell-tale lines on

79.

comes

the

Did that pe¬
activities of

group

are
studied by military they had faith that their currency enough money on hand, alreadywas and would
be redeemable in
announced in 1797 when the
saved for such an opportunity, he
The circulation
of gold is able to
policies of the Revolution had gold.
buy what is needed to
coins was 2.23% of the total stock
ruined
the currency of France
operate the idea to see whether it
in 1928; 2.05% in 1929; 1.68% in
and
had
left her isolated and
works out and yields a profit. If
1.81% in 1931; 3.64% in
threatened by enemies, that he 1930;
any 12-month period in our his¬
he
doesn't have enough money
1932, The biggest drain was in himself to
tory.
Commodity prices, on the would never, so long as he lived,
start, he may take in at
bullion withdrawals by foreigners
eve of our participation in World
resort to the printing press.
He,
few
partners who have enough
War
II
(i.e., November, 1941), contrary to the common practice in October, 1931 to June, 1932. monev among them which they
were
only 92.5% of 1926 prices. of dictators, returned to a metal¬ Our action in going off the gold can risk
This was despite the 41%0 devalu¬
lic standard—silver and gold.
It standard was the equivalent of
A
letter
to
the
"New
York
ation of the dollar in 1934. This is as stupid in time of war or fraudulent bankruptcy — the ac¬
Times," published Aug. 30, 1953".
devaluation laid a base for our threat of war to abandon a sound tion of a solvent debtor concealing
under the caption "Defining In¬
present great depreciation in the standard of value as it would be his assets to cheat his creditors.
ventions" says in part, "Inven¬
purchasing power of your dollar to
confiscate
all
calipers and
tions, after they are made, are of
Inconsistency of Our Monetary
which in March, 1951, reached the micrometers in time of war on the
necessity obvious, for each step,
Policy
lowest level in our history since
grounds that we should not meas¬
in their creation,
when all the
1914.
Why should we continue a pol¬
ure accurately what we are doing
facts are known, must appear as;
There is no valid basis for the in war time. A recent Norwegian icy which exposes us to drains of
a
correct and
logical step.
Art
widespread belief that irredeem¬ book by T. J. B. Hoff, "Economic gold to foreign countries, while

wealth

—is uncertain and for 20 years

stock
market index
nearly 50% and from
May, 1937 to May, 1938, industrial
production dropped nearly 33%
in one of the sharpest declines in

for each process

costs

men?

1938,

pressed likewise in dollars.
The
length of life of the machines or
other capital equipment required
the

the

years

the

that the best way to
weaken a capitalistic country, to
take it over for communism, was
first to debauch its currency. That
is done by denying to the people
the use in their exchanges of any
fixed
monetary
standard
ex¬

the contrary,
between August, 1937 and March,

in their values, ex¬

compared

deficits.

encourage

free

fuel,

of the several proc¬

in each

used

and

supplies

lubricant

consecutive

were

establish standard gear

followers forgot to

said

ing

suitable only
cal machines and take over theHis ardent
read attentive¬ ordering of the economic lives of
the
citizens for
the benefit of
ly his complete theory as they
themselves and their political fol¬
were
anxious to try the experi¬
ment of tampering with the stand¬ lowers, by seizure and manipula¬
tion of the monetary standard anc§
ard of value. And also, facts now
his

ified

for

Treasury

Keynes reported

our own

good, is

as
a
common denominator
qualified group of engi¬ (4)
neers
and
manufacturers
con¬ and, in the form of coin, as a set¬
tler of balances of payments in
cerned with that subject.
Doubt¬
between persons in
less
the Administration then in transactions
different parts of the world, that
power could not find a qualified
is in international exchange; (5)
monetary
economist among the
in the form of coin as asset re¬
American
stars
of that science,
serves for central banks;
and (6)
who would not expose the fallacy
most importantly as a check upprit
of
Keynesian economics for the
predatory governments wholong run.
Keynes himself qual¬
would otherwise build up politi¬

France!

experience, since we were taken
off the gold
standard to try a
"liberal" experiment in 1933, there

which1
ers

anarchy

unit

The

largest

from the effects of

political

briefly.
of value,

list them

The

which a
Let me

perform?

Committee

National

chanical Engineers

present

prevailed among business¬
It
was
dispelled in 1879
we resumed gold
payments

men.

ations.
of

depres¬
1873

1879, when the threat of Green¬

backs

machine preferable to an¬

period

longest

sion in the U. S. A. was from

compass.

Period

Greenback

has

of transactions, that is when one
party does something in Consider¬
ation of payment after a period
designs for use in America, de¬
of time has elapsed;
(3) in the
spite the objection of a committee
of the American Society of Me¬ form of coin as a store of value

deteriorating

than

econo¬

time.

that

called

had

ment

farmers to

franc for more
generation. Those who
have relied upon repayments in
francs have suffered the cruel loss
of 99% of their value since 1914.
No wonder that the conservative
creative
middle class there has
been ruined with consequent loss
of national power resulting in the
a

but others
can hold his head
until he drowns of

liquidity.

desirability of one course of
action compared to other possible
guide

water

under

the

-courses,

you

been suffering

monetary

polled

the Dollar

the functions

are

required to act (1) as a fixed comon
Monetary Policy was formed mon denominator and yard-stick
to warn the people of the even¬ for day-to-day transactions in our
tually evil consequences of that own country; (2) to serve equally
policy. It was as if our Govern¬ well as a standard in deferred

monetary
standard
France has

its

What

dollar

than 94 of the qual¬

Economists'

its free markets.

and

some;

say

mists

which it co¬
its economic activities,

namely

cannot

You can lead a
water but you can't make

horse to

field where eco¬
considerations govern in¬
in

work

you

say,

paralyze

standard for its own
contrary to ad¬

look at it.

Functions Performed by

was

American

ified

centers

ordinates

credit.

necessary

nerve

ourselves with economics

.more

only

and

by a plethora of money

engineers con¬
As economists
and
particularly with monetary push on a string.

Why should
cern

and

Good times are not en¬

standard.

Economic Considerations Govern

the gold

vice of

Con-

dorcet, Desmeuniers and others
of
Having taken out
worn
out and another must be having knowledge of the fallacies
three of the four spark-plugs of
of irredeemable currency advised
bought to replace it? If it is likely
a. four cylinder
engine, by a 75%
that the dollar will buy only half against the a,ssignat of the French
rate of tax
upon
efficient con¬
as much after 16% years one must
Revolution, even
though based
cerns, the machine of free enter¬
reckon on 33 years to repay the
upon land taken from the Church
prise limps badly.
value needed to replace the ma¬ ostensibly as security.
Your Towne Lecturer in 1947,
chine; and if the folly be com¬
The Killing Effect of
Mr. C. E. Wilson of General Mo¬
pounded by the dollar deteriorat¬
Unsound Money
tors
Corp., mentioned
the nar¬
ing to one-fourth its value in 33
rower definition of profit as "ex¬
Among us are engineers whose
years, earnings must be four times
cess of returns over expenditure."
as
much as would have been the work is to protect the country
In justice to the Honorable Mr.
in time of war.
To them may I
case with a stable dollar.
TVilson, it should be pointed out
Conversely, if distrust of the point out that efficiency of pro¬
that he goes on to say this is only
results of the continuation of the duction and choice of what we
part of the definition because it
present domestic policy of politi¬ should do requires a money cal¬
"ignores the dynamic role that
cally managed credit and irre¬ culus. To destroy a large animal
industrial profits play in the econ¬
deemable paper currency prevails it is only necessary to strike his
omy."
But Mr. Wilson did not and
produces economic distortions, nerve center, his brain, with a
point out that the standard of
paralysis and possible stagnation, bullet, whereupon the creature no
"value must be defined and fixed,
longer coordinates the actions of
the machine may be bought sec¬
if bookkeeping in
dollars is to ond hand later for a few cents on his organs and muscles. He then
represent a true condition.
For the dollar. Strange as it may seem falls sprawling to the ground aim¬
this
purpose
the gold standard to those who have not studied the lessly twitching until he dies. As
throughout all history seems to
history of paper money, bad times Karl Marx and Frederick Engles
have been
the best time-tested
occur when people lack
the confi¬ preached in 1848, to destroy a
standard.
dence engendered by the gold coin
complicated civilized society it is
in

jrner

platform pledge in 1932, went
It

took

neers

its

citizens.

11 s nign

prooiem.

that

pudiation of all money and fixed
investments. The French chemist,

What will be

agricultural economist, George
of Cornell University,
our Government, contrary to

Warren,

before we come
the end of the road—total re¬

sound
to

re-establishing

the

fundamental

the

themselves

Continued from page

by litigation in de-

Volume 178

Number 5278

The Commercial and Financial Chronicle

(2185)

fense of
this
000

After

had

still

when

£12,-

patent rights.

investment

gendered

($60,000) to spend in perfect¬

ing

process

found

neces¬

Mr. Lonsdon,
who had implicit faith in me, in¬
sary.

timated
and

partner,

his

soul

resolve

with

heart

bearing his

share of the cost."
Bessemer
store

by his

mechanical

father,

He de¬

talented

engineer

use

naturally.

by"

Paris,

caught

French

ing
:

portrait lathe,
disorder .of
the

the

Revolution, escaped dur¬
in the hostilities, tak-

lull

ing his family to England, bring¬
ing with them a vast quantity of
paper

assignats,

money,

which

bridges between man and
man.
That was our experience
following
resumption
in
1879.
Persons

personal

testament

of
in

defense

value

1938 enabled

$71,500

rencies

hands

metals, providing profit¬
employment for 12 men in
and 1,300 men in 1953.
I

that

sure

who

many

that good
out
of

this

fathering

with¬

grow

in the hands

the

idea.

isting authority, least of all by
of

group

governmental

use

value.

money

know

store

which

none

serves
so
well as gold coins or
gold convertible currency, in the
protection
of
t h e
individual

against
"V

with
the

follies

the

paper

planners
To deny to

money.

American 'citizen

the

monetary metal in which

;

use

defined; namely one ounce
being $35, is to deny to
him the best .'type of a store of
value.' 1r ?.;'A1 -V•'.

of >gold
;

not

that the
tions

of.

1933. '

ideas

sharply
initiative

skip
the

portant

capital

other

over

func¬
which a

money

unit is made, im¬
they are, to the sixth.

"The sixth

check

chines

build

take

and

over

the

order-

ing of the economic lives of citi¬

warns

that

tion

suddenly
The gold
set

followers
of

abuse

the

mone¬

Monetary Unit

free country a good

the

Before
that

1933

kind

Throughout our history
except for the rela¬
tively short periods of suspension
of redemption by our banks and
1792,

from 1861 through 1878, our paper
,

redeemable or con¬
certain weight of
gold (or gold or silver so long as
we
had bimetallism) at the free
currency

vertible

was

into

option and choice of the holder of
paper

Our

money.

deemable

The 17

of
irredeemable
currency
during
and following the Civil War were
years
,

ended by the

resumption of specie
in 1879.
That ended
depression of 1873 to 1879 and

payments
the

ushered

the

economists'
Standard

Strange
cf

era

charts

marked
as

the

"Gold

Resumption Prosperity."
as

rather than

may

seem

probable
less

that

credit may

has

man

gradually

redemption of
for

gold

American

exist

Confer¬

Action

at the Waldorf-Astoria Hotel.

ence

22, 1954

fective

brakes?

when
not

working?

that

down

view

and

the

car

forward

times, that we are
driving without them.

contrary,

better progress

credit system

make
with good

can

a car

brakes, and with

monetary and

which

trust

can

included
sound

pledge

gold

Bridges

"restore

convertible

Hearings

coin."
Reece

freely

money

Gold

the

Standard

be expected this winter.

taking

service

the

station

its

America

annual dinner at

rapid

the

practical designing

Security Traders Association of
New

York

dinner

annual

the

tampering

similar

upon us

that

forced

irredeemable paper
think that the

currency

political

you

Waldorf-Astoria.

(Canada)

of Canada

Convention at

Annual

Jasper Park Lodge.
Sept. 22-26, 1954 (Atlantic City)
National

ciation Annual Convention at the

Hotel

solution
answer

to your

is the

dollar

engineers

competent

think it

satisfactory

problems?

would be

the

Your

definite "No."

our

mon¬

etary problems.

Stuart

series

have

remarks

been

de¬

attention to

your

due

eering

the

work

which

and

the

of Tennessee

1973

interest.

accrued
bonds

was

Award

between

America
do

it!

competitive sale yesterday (Dec.
2) on a bid of 100.51%.
This

issue

provision

the issue)

bonds

the

re¬

principal
(94% of

$23,500,000
bonds

done

There is
to

should

again.

get
Let's

people who

difficult

for

the
prices

redemption
be

from

made

105.38%

sinking

par,

redemption

fund

prices recede from 101.34% to par.
and

owns

operates

natural

gas

pipe-line system. The line begins
in the Rio Grande
and

extends

direction

Valley of Texas
a
northeasterly

Texas.

across

the

point

One

City

planning

further

than

the

by the sovereign of the
to tell its citizens where

power

their moneys, for

use

they must be

purpose

em¬

should

whose

extend

those

clear

reason

the

that

hand

governments

abition

which
caused

economic
the

and

wars

have

wars

freedom

dislocations
so

success¬

fully suppressed.
Time does not permit an elabo¬
ration

the

toward

view

much

that

progress

unfettered

exchange of

currency is as much
indispensable bond uniting the

members of the free world

the development of economic
our

political stability among
allies, and few there are who

deny

successfully
that

the

economic

strength of
sable

which

and

political

restoration

balance

lasting

assertion

allies is indispen¬

our

the

sort

the

can

that

power

upon

tedious¬

peace may

ly be established.

New

line

the

Columbia

sidiaries

System, Inc. and of

iary,

Co.

Other

customers

wholly-owned

Co.,

serving certain

subsid¬

toward

freely convertible currencies
be had only by the concerted
tion

of national

violent

can

No
that

measures

fit for

and

our

economic

freely

currencies

can

own

parts
liber¬

convertible

Consolidated

would

make

ended

the

for

net

income

the

12-month

Sept. 30, 1953

was

period

$18,812,-

the

United

to be made

were

tain

States

which

rates

that

the

Rosenwald,

Chairman

Board, and E. F. Connely,

President

American

Securities

Corp., 25 Broad Street, New York

City,

announce

Parker' has

that Courtlandt B.

joined

the

the sales department.

staff

cared

rate

were

not

20%

ad valorem

or 5,000% ad
valorem,
important thing was that a
foreign commodity be excluded

the

of five decades, a

course

policy of.

exclusion.
It

not

trend.

easy

this

reverse

upset violently and to

inflict, without notice an injuiy
the interests associated with

upon

protection,

have adverse
only for our¬

might
not

consequences

selves, but for the whole com¬
munity of nations of which we
But this is not to say

part.

that

devise

cannot

scheme

which contemplates a slow, mod¬
est

reduction

forward

riod

barriers—a

our

into the future for

century.
took

much

the

decades

pe¬

half

even

reminded that it

world

than

five,

the

from

recover

re-

and

portant

importer

justice, to be
they
their

pay,

disposal
of
and

there

will

restrictions,
which

already

increase

the

cer¬

The

is for

exist,

into the United States.
measures

alone

would

succeed

selling

the

those

imports

These two

give

porters an assurance that if

out plans for

car^y

profitable future.
do

want

not

alone

give

may

freer

take

and for
which

measures

the

the im¬

leave

pression that it is for
us

exchange

benefits of a
currencies-

There is much for other countries
to

Already

do,

advances
markets
part of the

great

have been made by them,
have been restored, a

inflationary
material
has
been
stripped from their internal sys¬

But

it clear that

addition

to what

have

sufficiently long
to make adjust¬

time
to

other healthy and.

would

important measure

this country to make

and

have

important

notice

expect

can

steps

the

fully

im¬

taken.

yet been

and it must not be in¬

run

terrupted. The role that we should

play is one of encouragement, a
stimulant

were

further

progress.

The movement toward

economic

liberty

the

and
has

pace

It would be unfortunate

things which we

should

do, this strength

weaken,

this pace should

slacken
should

legitimately

can

wisely

1953

1933.

this

and

wane.

year

July,

and mo¬

if, by refraining from doing

and

the

Britain

continent

the

strength,

mentum.
for

momentum

respects

many

reminiscent of^

Let us hope that the

they opportunity which

American

been

has not

course

gained

even,

the

ports would fall and what tax he
have

move,

movement be slowt
temperate and wise, for those who
have grown up behind the policy
of exclusionism are entitled, in all
though

elsewhere

would

that

salutary

apply to them

simpler and

What is im¬

eighteenth century.

know into what category his im¬

second

William

that

tariff

tems and many

imports

step would have been taken.

Senate

302.

With American Securities

the

that

clear

classification

ing J;he
into

as¬

present highly complicated, intri¬
cate maze of regulations govern¬

tariff

its consolidated sub¬

materially

relatively simple steps.

land.

company and

in¬

so greatly during his
office, said on the floor

whether

ac¬

governments.

heroic

and

program

Trans¬

of New Eng¬

that

who

eign policy

A prudent program

system

Gas

pipe-line
areas

Gas

Consolidated

Northeastern

mission

War

Senator,

American economic for¬

tenure of

Needed

two

made

fluenced

not until after

was

World

distinguished

Governments

sisted by us if we would take but

sub¬

are

National

natural

gas

ments

Pittsfield, Mass. The com¬
pany's
principal
deliveries
of
near

the

period

Action

Concerted

Advances toward

the

system until about the turn of the
century and it

tense economic nationalism of the

and

vania

probably did not become im¬

bedded in the American economic

strictionism, mercantilism and in¬

to adopt.

state

doctrine of protection, in its full¬
ness,

stimulant to the growth of trade

York

long period

a very

It is fair to say that the

it is

are

New

time.

scheme which might project itsel*

might seriously damage

and

competition for

are

the

establish

internal economic health

York-Massachusetts

■

re¬

the

near

which gov¬
forces him.

the

Charleston, and the other branch
extends
across
Ohio,
Pennsyl¬

loss

currency

tool

exercise

Louisiana,

divides.

system

the

intervention

creed, an incon¬
is an indispen¬ from our market. The policy of*
state planner.
protection, which commenced to¬
There is nothing which may ad¬ ward the end of the last
century,
vance designed
and premeditated has tended to become, over the
sable

and

before maturity.

may

while

fund

sinking

these

Regular
ranging

has

which calls for

tirement
amount

our

convertible

fixed rate.

the road

increasingly

vertible

by the group

won

have attempted

a currency

gold at

much

connection

liberty and
into

with

problems

familiar.

trace

larger, it be¬

grows

traditional

symathy

Inc.

Co.

present perils of false thinking in

are

the economic decisions of the

the striking parallels between the

monetary policy and those engin¬

ex¬

within which

area

expended. It is for this

Gas Transmission Co. at 101.379%

sidiary

signed to direct

and in what amounts they can be

Halsey, Stuart Group
Offer Pipe Line Bonds

inconvertibility of

solution of

planning

ployed, and for what commodities

you

state

marketplace

what

Gas

would

spe¬

can

successfully re¬
proposition that, as the

they must

Claridge.

include

present

for

state

Security Traders Asso¬

Natural

the

our own

worthy image, but there

the

its

Investment Dealers' Association

merely

because

fute

incur

sustain.

this country to remain faithful to

June 9-12, 1954

engineering societies should sit
by?
If your high standards
of
engineering were to be cut
idly

and

American

few who

and

Many industries in this country
enterprise have been
protected from foreign

the world in

succor

would

comes

branch extends into West Virginia

to be¬

were

endangered

gave

tended and the

where

engineering profession in

powerful

dextrous

individual

governments substitute their dicta

Arkansas, Mississippi and Tennes¬
see to a point in eastern Kentucky

with

progress

and

May 7, 1954 (New York City)

re¬

may

this

qua]-?

attractive?

them

price which is appealing,
the government will not interfere
to compel the importer to retreat
ernment

imprudent for us
to
attempt to fashion the eco¬
nomic, social and political pattern

Dealers

Security

28th

the

install

that

are

the

into

car

resilient

system

cial

Tennessee Gas Transmission Co.

Republican party platform

plan

domain

wild.

run

The

off

might

hold

brakes

retarding

the

into

do
are

the Biltmore Hotel.

the brakes repaired.

because

back,

movement

not

you

slow

theoretical

brakes-*

along to the nearest service

creep

station to get
Yet

What
your

good

having ef¬

car

find

you

lacking

car

with

state

make

citizens.

City)

(New York

York

New

and at

which

activities, the finan¬
operations, of

of other countries in
Jan.

else¬

held

ity

cial and commercial

(New York City)

Advertising

Halsey,

sometimes

commodities of

consumers

with

its time of need.

and

At present

many

more,

(Buffalo & New

resume

can

safe.

the

brakes,

re¬

brought

years

currency

great prosperity.

Rooms).

Jan. 14, 1954

ask

with

run

the suspension by our government shortage

Party

and
you, whether we
can
make greater average speed, associates are offering $25,000,000
mortgage pipe line bonds,
up hill and down dale, in a day's first

mone¬

money.

currency

come

been

hour.

per

down at dan¬

it's

resumed

citizens.

its

politicians.

the brakes

is without brakes until

car

have

silver—having
intrinsic value independent of the

since

house

safety.

had

back

precau¬

the

Then

speed when

tary unit is expressed in terms of

dollar

put

brakes

times,

steadily.

sume

ruling

York

gold

currency

miles

It slows

gerous

brakes

tary standard.

our

over¬

20-ton truck going

hydraulic

devised.

Christmas

the Hotel Statler

standard is like the best

may

political

metal—gold

neces¬

The

burn

hill

down

are

wish to

shouldn't throw

the

by overheated wires. Some¬
in political circles said that

Bill

measure

before

their

Good

circuit.

useful

for the benefit of themselves

re¬

into

redeemable

people merely

one

Angeles

de¬

electrical system.

when

the

standard

1953 (Los Angeles, Calif.)

Security Traders Association of
Los

quite

where that it is the duty and re¬

Field

its

fixed legal

fuse

and

kept

holder

electrical

zens

seizure

the

part of

sary

Dec. 18,

inconsistent

sponsibility of the

Association

The

preda¬

upon

who
would
political ma¬

governments

tory

otherwise

which

and

view

the economic

requirement

convertible

re¬

standard

good

the

currency

better

private

after

effective.

shall

tions

•'

fell

centers

be
I

patent applica¬

index of the birth rate

Centers

quire
to

curve

new

coincidence

mere

mand

Investment

the

dol-

our

lar

♦

gold stand¬

degree of manage¬
too, but such management is

planners.

Developments of all sorts by free
individuals, are facilitated by pri¬
vate

and

money

enterprise

hostile

are

really new it is by definition
likely to be recognized by ex¬

not

Convertible Currencies

down

value

room

experience

ideas don't

those

it's

store

require

deemable

store

metallurgical idea of making hard
crystals
under
various

paper

credit resting upon a

ratio.

carbide

1938

The

means.

cur¬

advised in trying
objectives by those

ex¬

molten
able

ill

are

to attain their

try out

1953.

another

irredeemable

standard of money at a

Onr National Stake in

theories offered

monetary

tell

only because it is
ample known to me, that

and

Towne

your

the

page

time

Those espousing one or

can

you,

Lecturer for

dence.

that

die maker, and later made dies
for the Caxton printing type.
As

honor

EVENTS

restrained

been

the

establish

has

pleasure to have been

free

exchanges

from

experience.

COMING

considerable sum in
With the latter he
himself

countries

stretches

tested

Continued

of acting in accordance

portance
with

facilitated

make

can

ment

various

recognize and understand the im¬

by the gold standard. Investment
can
go
on
with greater confi¬

importantly
gold coins.
able

various

ard

was

en¬

standard,

live
threatened by destruction

are

proved to be worthless, but more
a

gold

the

and inventor of the

than when the "promises men

over

came

value

scribes how his

have the confidence

will not be missed

then missed

again.

Financial Chronicle... Thursday, December 3. 1953

The Commercial and

'(2186)

★ INDICATES

Now in Registration

Securities
Allen Electric &

Equipment Co., Kalamazoo,

Mich.

75,000 shares of common
stock (par $1).
Price —$4 per share. Proceeds —For
working capital.
Office —2101 North Pitcher Street,
Kalamazoo, Mich.
"Underwriter — S. R. Livingstone,
Crouse & Co., Detroit, Mich., and Olmsted & Mulhall,
Inc., Kalamazoo, Mich.
(letter of notification)

Nov. 13

Amalgamated Growth Industries,

Inc.

149,999 shares of common

Sept. 28 (letter of notification)

Proceeds—For
acquisition of patents, etc., and for new equipment and
working capital. Office—11 West 42nd St., New York
City. Underwriter—R. A. Keppler & Co., Inc., New York,
cents). Price—$2 per share.

stock (par 10

N. Y.

Corp. (Del.)
Nov. 16 (letter of notification) 200,000 shares of common
stock (par 10 cents). Price—$1.50 per share. Proceeds
—$14,500 to be paid to Commonwealth Research Corp.
in accordance with agreement; $20,000 for drilling and

★ Boren Oil & Gas Corp., Wichita Falls, Tex.
11 (letter of notification) 748,000 shares of com¬
mon stock
(par 10 cents). Price — 40 cents per share.
Proceeds—For working capital, etc.
Office—Oil & Gas
Nov.

Bldg., Wichita Falls, Tex. Underwriters—Hunter Securi¬
ties Corp., New York, and N. R. Real, Nutley, N. J.

Bridgeport Gas Light Co.
Nov. 12 filed 60,500 shares of 5.28% cum. convertible pre¬
ferred stock, being offered for subscription by common
stockholders at rate of one preferred share for each three
common shares held as of Nov. 27; rights to expire on
Dec. 22. Price

construction

the North Carolina acreage; $50,000
three additional wells; and the re¬
mainder for working capital, etc. Office—317-325 South
State St., Dover, Del.
Underwriter—Walter Aronheim,
one

reserve

well

American Diamond Mining Corp.

shares of common
Proceeds—To ex¬

plore and develop the Murfreesboro, Pike County, Ark.,
property and for general corporate purposes. Office—
99 Wall St., New York 5, N. Y. Underwriter—Samuel W.
Gordon & Co., Inc., New York, N. Y.
American

Fidelity & Casualty Co.,

Inc.

Nov. 3 filed 150,000 shares of convertible preferred

being

$5)

subscription

for

offered

stockholders of record-Nov. 20

with

(letter of notification) 300,000 shares of com¬
mon stock (par 10 cents).
Price—$1 per share. Proceeds
—For production of movies and TV stories. Office—246
Fifth Avenue,
New York.
Underwriter — Alexander
Reid & Co., Newark, N. J.

on a

convertible equipment trust
certificates, series A, and 890,000 shares of common stock
(par 50 cents), of which the certificates and 400,000

stock

common

share-for-share basis;

expire on Dec. 9. Certain stockholders
have waived their rights to purchase 30,000 of new
shares. Price—$22.25 per share. Proceeds—For working
rights to

publicly; 300,000
to be sold to the underwriter (including 50,000

are

shares to

$600,000 of 7%

the

stock

James

one

offered

are

Wooten), 70,000 shares to Sig Shore,

70,000 shares to Fred Miller and 50,000 shares to James
Wooten. Price—To public—100% for certificates and 75
cents per share for the

Proceeds—To finance the

stock.

acquisition of four Martinliners and one Douglas DC-3
aircraft from Airline Transport Carriers, Inc.
Under¬
writer—Gearhart & Otis, Inc., New York.

Nov.

stock.

(letter of notification) 125,000 shares of capi¬
Price—$1 per share. Proceeds—To drill four

Office—139

wells.

No.

Virginia St., Reno, Nev.

Under¬

writer—None.

capital. Underwriter—Geyer & Co., New York.
American-Israeli Cattle Corp., Beverly Hills, Cal.

Capital Uranium Co., Farmington, N. M.
28 (letter of notification)
1,200,000 shares of

Oct.

Price—At

Aug. 24 filed 100,000 shares of class A common stock.
par ($10 per share).
Proceeds—To establish
and develop a cattle industry in Israel. Underwriter—
None.

expire

1954

shares of stock held; rights

Dec. 10. Conversion price beginning Feb. 9,

$136

per

capital

Price—At

stock.

(par five cents).

Price — 10 cents per share.
exploration, drilling and development of
mining claims. Underwriter — Forbes & Co., Denver,

Carolina

convertible
debentures, due Dec. 10, 1965. being offered for subscrip¬
tion by stockholders of record Oct. 30 in the ratio of $100
seven

$24.50 per share.

—

stock

common

from

and

pro¬

sale later in year of 15,000 shares of $100 par
cumulative preferred stock to be used to repay bank
loans and to pay for new construction. Dealer-Managers
posed

Securities

Webster

—Stone

Corp., and Allen & Co.,

New York.

both of

Century Acceptance Corp.
16 (letter of notification) 10,000 shares of class A
stock (par $1) and 5,000 shares of class B stock

Oct.

common

Proceeds—To Robert F. Brozman, the

selling stockholder. Office—1334 Oak St., Kansas City,
Mo. Underwriter—Wahler, White & Co., Kansas City, Mo.
★

Cincinnati

& Suburban Bell

Nov. 6 filed 312,812

shares of

for

Telephone Co.

common

At par

for

stock to be offered
stockholders of record Nov.
l-for-3 basis; rights to expire Jan. 18. Price—

subscription by

common

($50 per share). Proceeds—To reimburse treasury

expenditures made for extensions, additions and im¬

provements to plant. Underwriter—None.

★ Commercial Discount Corp., Chicago, 111.
(letter of notification) 3,500 shares of $3.50 prior
preferred stock. Price—At par ($50 per share). Proceeds
—For working capital.
Office—105 W. Adams St., Chi¬
cago 3, 111.
Underwriters — Julien Collins & Co. and
Cruttenden & Co., both of Chicago; and The First Trust
Co. of Lincoln, Neb.
Offering — Scheduled for today
(Dec. 3).
.
Nov. 23

Cosmo Oil Co.,

Denver, Colo.
300,000 shares of common
stock.
Price—At par ($1 per share).
Proceeds—For
drilling expenses and working capital.
Office — 922
Equitable Bldg., Denver, Colo. Underwriter—E. I. Shel¬
ley Co., Denver, Colo.
(letter of notification)

D.C.

(letter of

notification) 6,000 certificates of par¬
ticipation.
Price—At par (in units of $50 each).
Pro¬
ceeds
For general corporate purposes.
Office — 439
Wyatt Bldg., Washington, D. C. Underwriter—James T.
De Witt & Co., Inc., Washington, D. C.
—

★ Dallas Power & Light Co., Dallas, Tex.

American Telephone & Telegraph Co.
Oct. 14 filed $602,543,700 of 12-year 3%%

of debentures for each

sale

Cuban American Minerals Corp., Washington,

Colo.

stock

expire Dec. 8. Price

rights to

19;

Proceeds—From

Oct.
com¬

Proceeds—For

mon

(par $15)

stock

common

at rate of one new share for each 10 shares held on Nov.

Oct. 7

★ Calray Petroleum Corp., Reno, Nev.
tal

70,400 shares of

being offered for subscription by common stockholders

Inc.

Central Airlines,

California

ISSUE

(par $1). Price—Of class A, $2.50 per share: of class B,

Sept. 24

Nov. 5 filed

REVISED

Electric & Gas Co.

Illinois

filed

$1.90 per share.

Productions, Inc.

Picture

Burton

Nov. 6 (letter of notification) 260,000
stock (par $1). Price—$1.15 per share.

(par

and Chas. W. Scranton &

for drilling

New York City.

•

share). Proceeds — For
Underwriters—Smith, Ramsey &

Central
Oct.

ITEMS

•

At par ($25 per

Co., Inc., Bridgeport, Conn.,
Co., New Haven, Conn.

American Development

testing

—

program.

ADDITIONS

SINCE

Telephone & Telegraph Co.

Nov.

(letter

notification)

Aug. 17 filed 33,320 shares of capital stock to be offered

stock (no par) to be offered for

for

stockholders

subscription by stockholders in the ratio of

share for each five shares held.

share).

Proceeds—To

writer—None.

reduce

Price—At par

short-term

one

($100

notes.

new

per

Under¬

Offering—Temporarily postponed.

held.

basis of

Price—$130

struction.

common

share for each 10 shares

one new

share.

per

672

subscription by minority

Proceeds

For

new

con¬

Commerce St., Dallas. Tex.

Office—1506

Un¬

—

derwriter—None.

par

(flat), $100 for each $100 principal amount. Proceeds—
For

advances

subsidiary

and

associated

companies,

NEW ISSUE CALENDAR

etc. Underwriter—None.

Anacon Lead

Mines, Ltd., Toronto, Canada
Sept. 28 filed 700,000 shares of common stock (par 20
cents—Canadian funds) to be offered for subscription by
common

stockholders

each five shares held.
ment.

the rate of

one

new

December 3
Southern

Pacific

for

(Bids

Proceeds—To develop

supplied by amend¬
mining properties. Under¬

Armstrong Rubber Co.
March 31 filed $4,000,000 of 5% convertible subordinated

Kopp

Water

1, 1973. Price—To be supplied by
working capital. Business—

tires

and

tubes.
Underwriter—Rey¬
Offering—Postponed.
1

•

—To

stock

James

(no par).

Duquesne
—

Pripe—$21

share. Proceeds

per

Under¬

writer—Gruntal & Co., NevrHaven, Conn.

Atomic Development Mutual Fund,
Nov. 18 filed 90,000 shares of
be

supplied by amendment.

Underwriter—Atomic

common

Proceeds—For

Development

Light

Sterling,

$200,000

Trad

McCoy & Willard)

$125,000

(Monday)

EST)

a.m.

$5,000,000

Inc

(12/8)

investment.

Debentures
&

Co.)

Indusco, Inc.

Securities

Corp.)

Co.)

(Bids

Tri

Dent

Maggio,

Inc.)

(P. S.

Cfiica£$,

■

Co.)

(J.

White

Co.,

Louis-San Francisco

90,000

$750,000

(Bids

noon

EST)

Cfmsifpiers
fOf fifing

21,000 shares
/'

(Wednesday)

-Common

Power Co.—„

to stockholders—bids 11 a.m. EST) 679.436 shares
;'

Preferred

January 11-(Monday)

•f:

Appalachian
*

$7,500,000

a.m.

January

EST)

-Debentures
$300,000,000

(Bids to

Bonds

(Bids to be

(Tuesday)

invited)

York, Inc.—Bonds

$35,000,000

PubliefServiee Co. of Indiana, Inc
\.

$20,000,000

Consolidated Edison Co. of New
■

Electric Power Co
(Bids H

(Wednesday)

(Morgan Stanley & Co.)

New

Inc.)

$250,000

Motors Corp.-

.Common

Rope Corp
W. Brooks & Co.,

January 6

Ry.__-_Equip. Trust Ctfs.

December 9
General

Inc.)

.Equip. Trust Ctfs.
$7,650,000

;

North American Acceptance Corp
St.

$7,500,000

■

Inc.—Common
Debentures

—.Preferred

(Thursday)

Corp.
(Courts

EST)

noon

Common

„

$121,360

(Bids noon CST)

iion|>1#ire

$300,000

(Atomic Development Securities Co.)

Ludman

(Wednesday)

Milwaukee St. Paul & Pacific

(Tuesday)

Atomic Development Mutual Fund,

Equip. Trust. Ctfs.
be invited)

"RR.il—__—
Common

jJJc/jP.

Beverage Franchises Inc., New York
16 (letter of notification)
198,000 shares of com¬
mon stock (par one cent).
Price—$1.50 per share. Pro¬
ceeds—To repay loans, to establish
bottling plants and
for working capital. Underwriter—Richard &
Co., New¬
ark, N. J.

$300,000

Moseley & Co.)

(Bids

Washington, D. C.
Nov.

Common
Co.)

December 17

December 8

Corp

Narragansett Electric

Common

125,000

.__

(Charles

Co.,

EST)

noon

Corp.-

Common
and

209,000 shares

Son)

December 16

New England Electric System

Lewi^ton, Greene & Monmouth
Telephone Co.

$280,500

160,000

about

Rupe

Wesletn Maryland Ry._
_'\yt
(Bids to

Mohawk Business Machines Corp
&

Debentures

Watling, Lerchen & Co.) 310.000.000

(Tellier

$1,600,000

Preferred and Common

(Prudential

(Tuesday)

Gasoline Co

Television

Preferred

and

Dallas

...Common

(McCormick

Price—To

Securities

Inc.)

and

(Bids

(Bache

Inc.

stock.

Firth

Walsh, the selling stockholder.

Co.,

Inc.

(Carl M. Loeb, Rhoades & Co.
V-

Common

★ Armstrong Rubber Co., West Haven, Conn.
Nov. 27 (letter of notification) 1,000 shares of class A
common

Texas Natural

(Friday)

December 7

Proceeds—For

nolds & Co., New York.

Trailer
Brothers

(Lehman

Scientific, Inc.

(Gearhart & Otis,

Fruehauf

$5,925,000

Supply Co

(Blyth

Manufacturer

EST)

noon

December 4
Jamaica

amendment

Equip. Trust Ctfs.

Price—To be

writer—None. Financing proposal has not been dropped.

tfebentures due May

December

(Thursday)

Co._

invited)

.Bonds

$25,000,000

York, New Haven & Hartford RR.
January 13

Equip. Trust Ctfs.
(Bids

noon

EST)

December 10

$6,600,000

Edison Co.—
(Oitfe'ftng to stockholders—bids

(Thursday)

(Wednesday)

Ohio

Common
to

invited)

527.830 shs.

i
'•

Erie RR,,^.
y*
on

Nev^York.

-Equip. Trust Ctfs.
.

(Bids

noon

EST)

$5,400,000

Bonds

Philadelphia Electric Co

"Boston

Philadelphia.
.

Pittsburgh

San Francisco

Chicago

■

Cleveland

Private lVires

all

offices

(Bids

a.m.

December

"ff

Continental

January 18

EST)

Transportation
(Shields

Co. I

Fire Association of Philadelphia
Common
(Offering to stockholders—The First Boston Corp.
•

will

$20,000,000

250,000

act

January

(Monday)
Lines-

.—Common
shares

(Monday)

Ohio

Edison

advisors)

$7,650,000

(Tuesday)

Bonds

Co
(Bids

rfft

Invited)

$30,000,000

Volume 178

Number 5278

The Commercial and Financial Chronicle

...

(2187)

if Dealers Discount Corp., Darlington, S. C.
Nov.

(letter

notification)

Price—At

stock.

com¬

share). Proceeds—
For working capital. Office—105 Exchange St., Darling¬
ton, S. C. Underwriter—G. H. Crawford Co., Inc., Co¬
lumbus, S. C.
mon

($5

23,765

par

per

held; rights to expire

Proceeds—For
of

working

junior subordinated

Dec.

capital

and

Price—At

par.

$100,000
notes. Office—Government Em¬
prepay

ployees Insurance Bldg., Washington 5, D. C. Under¬
writers—Johnston, Lemon & Co., Washington, D. C.; and
E. R. Jones & Co., Baltimore, Md.

Delaware Power & Light Co.

Oct. 28 filed 232,520 shares of common stock (par $13.50)

being offered for subscription
of record Nov. 25
shares

seven

the basis of

held;

rights

one

share for each

new

expire

stockholders

common

Dec.

15.

Em¬

ployees will receive

rights to subscribe for up to 150
shares each. Price—$24 per share. Proceeds—For con¬
struction program. Underwriters—W. C. Langley & Co.
and Union

if Great Southwest Fire Insurance Co.,
Phoenix, Ariz.
Nov.
to

filed

750,000

offered

capital stock (par $1)
policyholders in National Reserve In¬

(Phoenix, Ariz.) and to present and future
directors, officers and employees of both the Great West¬
and National Reserve

ern

Securities Corp. (jointly).

Corp., North Miami, Fla.

(12/8)

Oct.

26 filed $750,000 of 6%
sinking fund convertible
debentures due Nov. 1, 1968.
Price—At par (in units of
$100 each) and accrued interest. Proceeds
to repay
—

bank

loans, and for

equipment and general corpo¬
rate purposes. Underwriter—Courts &
Co., Atlanta, Ga.
new

★ MacKinnon's, Inc., Seattle, Wash.
24 (letter of notification)
$100,000 of 6% 10-year
convertible coupon debentures due Jan. 1, 1964. Price—
At par (in denominations of $500 and
$1,000 each). Pro¬

Nov.

Co.

surance

Ludman

companies. Underwriter—None.

ceeds— For

working capital.
Office — 127th St. and
Way, Seattle 55, Wash. Underwriter—First Wash¬
ington Corp., Seattle, Wash.

Bothell

Greenwich Gas Co., Greenwich, Conn.

Maine

Public Service Co.

Duquesne Light Co. (12/7)
Aug. 19 filed 100,000 shares of preferred stock (par $50).

Nov. 12 filed 75,468 shares of common stock (no
par) to
be first offered for subscription by the holders of the

Nov. 2 filed 35,000 shares of common stock

ing offered for subscription by

common

Proceeds—To reduce

89,333 shares presently outstanding; then to public. Price
—To be supplied by amendment. Proceeds—From sale

record

Nov.

new

held

(with

will

tion.

Underwriters

bank

loans and

for

To be determined

—

construc¬

new

by competitive

bidding. Probable bidders: The First Boston Corp.; Kid¬
der, Peabody & Co., Merrill Lynch, Pierce, Fenner &
Beane and White, Weld & Co. (jointly); Kuhn, Loeb &
Co. and Smith, Barney & Co. (jointly); Blyth & Co.,
Inc.;
Lehman

(EST)

Brothers.

Bids—To

received

a.m.

Dec. 7 at the office of Standard Gas & Electric

Co., 15 Broad St., New York 5, N. Y.
Farm & Home Loan & Discount Co.,
9 filed 863,230 shares of class A

Phoenix, Ariz.

Nov.

stock,
858,186 shares of class B common stock and 1,000,000
shares of class C common stock. Price—25 cents, 35 cents
and 50 cents, respectively. Proceeds—For working
cap¬
ital.
*

common

Pipe & Foundry Co. (N. J.)
(letter of notification) 39,000 shares of common
.•{par 25 cents). Price—$1 per share. Proceeds—For
purchase of land and machinery, to erect buildings and
for working capital. Underwriter—A. Kalb & Co., Tren¬
Nov. 16

stock

ton, N. J.
Nov.

Sterling, Inc., Pittsburgh, Pa. (12/7)
$1,600,000 of 6% convertible sinking fund

filed

subordinated debentures due Dec. 1,

supplied by amendment.
debtedness.

and for construction program. Underwriter—F.
nam &
Co., Inc., Hartford, Conn.

1968. Price—To be
Proceeds—To retire present in¬

Underwriter

McCormick & Co.,

—

(no par) to be offered in units of four debentures
$250 principal amount each and 100 shares of stock.

Price—$1,100 per unit.
Proceeds—To rehabilitate and
racing plant in Tucson, Ariz.
Business—Dog
racing with pari-mutuel betting privileges. Underwriter

construct

Gulf Sulphur Corp., North Kansas
City, Mo.
Oct. 27 filed 700,000 shares of convertible
preferred and

participating stock (par 10 cents). Price—$10 per share.
Proceeds—To develop company concessions. Underwriter
—Peter Morgan & Co., New York.
if House of Better Vision, Inc., Miami, Fla.
(letter of notification) 299,500 shares of
(par

cents).

Oct. 30 (letter of notification)
debt and for

stcok

Co.,

•

Indusco, Inc.

and 50,000 shares of common stock

stock.

Price—$5

unit.

per

share of

one

(par

each class

Proceeds—For

construction.

Underwriter—None.
Florida
Nov.

Western Oil

(letter of notification) 250,000 shares of common
stock (par 10 cents). Price—$1 per share. Proceeds—For
drilling test well. Office—803 N. Calhoun St., Tallahas¬
see, Fla.
Underwriter — Floyd D. Cerf, Jr., Co., Inc.,
Miami, Fla.

Fruehauf Trailer Co.

Nov.

filed

debentures

$10,000,000 of convertible subordinated
Dec. 1, 1973.
Price—To be supplied by

due

amendment.

(12/15)

Proceeds—To

retire

short-term

indebted¬

and

to
increase working capital.
Underwriters—
Brothers, New York; and Watling, Lerchen &
Co., Detroit. Mich.
ness

Lehman

•

General

Nov.

Acceptance Corp.

(letter

notification)

12,000

preferred stock of Universal Finance Corp., Omaha, Neb.,
on
the basis of one General Acceptance share for each
2Vz

Universal

21.

Office—949

shares.

writer—None.

General

This

Hamilton

will

offer

expire

Allentown,

St.,

Pa.

Dec.

Under¬

Aug. 12 filed $1,010,800 of 20-year debentures and 66,424
shares of
of $350

stock.

per

stock

common

porate

Business

Oil

and

development.
Under—riter—None. Office—Oklahoma City, Okla.
purposes.

General

Motors

—

Corp.

gas

(12/9)

Nov. 17 filed $300,000,000 of 25-year debentures due 1979.
Price—To
be supplied
by amendment.
Proceeds—To
finance capital expenditures and for working capital.
.Underwriter—Morgan Stanley & Co., New York.
General

Shoe

Corp., Nashville, Tenn.
Oct. 2 filed 19,465 shares of $5 cumulative preference
stock, series B (stated value $100 per share) and. 139,742
shares of common stock (par $1) being offered in ex¬
change for shares of stock of Berland Shoe Stores, Inc.
on

the

following basis: For each Berland

0.54253

4 6/11th

series

Shoe

Berland
stock.

prefered

Offer,

one

which

Giffen
4

and

each

62,500 shares

of^dpmmon

Proceeds—For general corporate

St., Coral Gables, Fla.
will & Co.. Miami Beach, Fla.
Government
filed

debentures

into

stock

common

publi^ $4 per
purpose^ Office

Underwriter—At-

-?£

due

the

offered for

Dec.

rate

convertible-junior
1, 1963 (convertible

of $20

per

sharej-

being

subscription by common stockholder^of rec¬
ord Nov. 17 at the rate of $100 of debentures
forjgach 15

per

100,000 shares of
share).

common

Proceeds—To pay

working capital, etc. Underwriter—Barham
Gables, Fla.
(Del.)

(12/7)

—

cumu¬

promotion, acquisition

materials and working capital, etc.

raw

Beaver St., New York, N. Y.

Underwriter

Office
—

—

Prudential

—

subsequent commercial

exploitation in

the field

Oct.

Beane

and

(par $10) be¬

stockholders of

for

each

six

privilege).
per

Rights
share. Proceeds

—

Merrill Lynch,

Kidder, Peabody & Co.,

(Pa.)

Water Co.

(letter of notification) $125,000 of 4%% first
mortgage bonds, series A, dated Oct. 31, 1953, and due
Oct. 31, 1978, to be offered to residents of
Pennsylvania.
Price—100% and accrued interest. Proceeds—For part
payment of installation of

water filtration

new

plant.

Underwriter—None.
Matheson Co.,

Inc. (N. J.)
(letter of notification) $200,000 of 15-year 6%
convertible debentures due Jan. 1, 1969.
Price—100%

Nov.

and

accrued

interest.

Proceeds—To construct plant in
for working capital.
Business—
Sale of compressed chemical gases.
Office—932 Pateitv

Norwood,

Ohio,

Plank

and

Road.

East Rutherford, N. J. Underwriters—
Investing Co., Inc., Utica, N. Y., and
Security and Bond Co., Lexington, Ky.

son

Valley

if Midland Uranium, Inc., Salt Lake City, Utah
23 (letter of notification) 1,500,000 shares of

Nov.

com¬

stock (par one cent).
Price — 10 cents per share.
Proceeds—For drilling and prospecting. Office—504 Felt

mon

Bldg., Salt Lake City, Utah.
Brothers

Underwriter—Harrison

Co., Salt Lake City, Utah.

Midvale Co.

Nov] 16

(letter of notification) up to but not exceeding
3,600 shares of capital stock (no par). Price—At market
(about $15.50 per share). Proceeds—To Baldwin Securi¬
ties Corp. Underwriter—Drexel

& Co., Philadephia, Pa.

if Minerals Refining Co., Murray, Utah
Nov. 27
(letter of notification) 113,000 shares of com¬
mon stock.
Price—At par ($1 per share). Office—5221
So. Major St., Murray, Utah.
Underwriter—None.

Underwriter—Lee Higginson Corp.,
New York and Boston (Mass.).
Offering—Date indefinite.
Israel

Oct.

Enterprises,

filed

18,8Q0

Inc.,

shares of

stock.

Price—At

($100 per share). Proceeds—For investment in exist¬
ing industrial enterprises in Israel. Underwriter--None.
par

Jamaica

Nov.

Water

Supply Co. (12/4)
(letter of notification) approximately $200,000

aggregate market value of

common

stock

(no par). Price*

market.

Proceeds—Together, with other funds, to
repay bank loans totaling $2,000,000.
Underwriter—Blyth
& Co.,
Inc., New York.
28

filed

Canadian).

550,000 shares of

Price—$3

per

common

share.

Business

(letter

supplied

common

stock

Proceeds—For

expan¬

Keene & Co., Inc.

two shares of

preferred and

one

share of

common

stock.

Price—$21 per share.
Proceeds—For working capital.
Business—To deal in listed and over-the-counter securi¬
ties.

Office—80 Wall St., New York, N. Y.

Underwriter

—None.

Kopp Scientific, Inc.

(12/4)

Nov. 16 (letter of notification)
125,000 shares of common
stock (par 10 cents). Price—$1 per share. Proceeds—To
repay

bank

loans

and

other

debt

and

for

working
capital, etc. Underwriters—Gearhart & Otis, Inc., New
York; and McCoy & Willard, Boston, Mass.
if Laboratory of Electronic Engineering, Inc.
(letter of notification) 17,523 shares of class A

Nov. 25

stock.
Price
At par ($10 per share).
Pro¬
ceeds—For working capital. Office—413 L
Street., N. W.,
common

—

Underwriter—None.

Lewiston, Greene & Monmouth Telephone Co.,
Winthrop, Me. (12/16)
Nov.
stock.

(letter of notification)

12,136 shares of

common

Price—At par ($10 per share). Proceeds—To pay
indebtedness. Underwriter—F. S. Moseley & Co., Boston,

Mass.

Price—To be supplied by amend¬

Proceeds—For improvements, etc. Underwriters—
To be determined by competitive
bidding. Probable bid¬
ders

include:

Shields

& Co., Savard & Hart and
(jointly); Kuhn, Loeb & Co.
and Glore, Forgan & Co.
(jointly); Lehman Brothers;
White, Weld & Co.; Smith, Barney & Co.; The First
may

Halsey, Stuart & Co. Inc.

Boston Corp. Bids—Not expected until after Jan.

1, 1954.

if Moore (John B.) Corp., Nutley, N. J.
Nov. 25 (letter of. notification) 200 shares of 7% cumula¬
stock

(par

(par $100) and 2,000 shares of

10 cents)

preferred share and

to be offered in

10 common

com¬

units of

one

shares. Price—$110 per

bills and obligations and to

pur¬

Office — 349 Franklin Ave.
(P. O. Box 3), Nutley 10, NVJ. Underwriter—None.
raw

materials,

etc.

if Mutual Finance Co., Tampa, Fla.
24 (letter of notification) $300,000 of 10-year 6%
subordinated debentures, series A.
Price—
At par. Proceeds—For investmnet capital. Office—Wal¬
Nov.

convertible

lace

(N. Y.)

ment.

unit. Proceeds—To pay

Nov. 10 (letter of notification) 10,000 shares of 6% cumu¬
lative preferred stock
(par $10) and 5,000 shares of
common stock
(par 10 cents) to be offered in units of

Price—To

buy machinery
Underwriter—

filed

chase

Kay Jewelry Stores, Inc., Washington, D. C.
Sept. 28 filed 672,746 shares of capital stock (par $1) to
be offered in exchange for preferred and common stocks
of 71 store corporations which
operate 83 retail credit
jewelry stores. Underwriter—None.

cents).

(City of)
$14,854,000 of series 1953 debentures for
improvements and $8,000,000 of series 1953 deben¬
19

local

writer—Globe

Corp., Ltd., Montreal, Canada.

Proceeds—To

Montreal

;

Nov.

sion and exploration and development
expenses. Under¬

Securities

(par

amendment.

Corp. (12/7)
approximately 160,000

inventory and for working capital.
Bache & Co., New York.

mon

(par $1—

Machines

notification)
stock

and

tive preferred stock

Jasper Oil Corp., Montreal, Quebec, Canada
Oct.

tures for public works.

New York
common

Nov.

of ion

exchange chemistry.

•

one

of New York.

Manheim

Mohawk

Ionics, Inc., Cambridge, Mass.
June 30 filed 131,784 shares of common stock
(par $1).
Price—To be supplied by amendment
(between $8 and
$9 per share). Proceeds—To pay mortgage debt and for
equipment. Business
Research and development and

•

oversubscription
Dec. 8. Price—$20.25

Pierce, Fenner

Securities Corp., New York.

Washington, D. C.

''k

Employees Corp.
10-year 4%%

$500,000

subordinated

befoffered

share. Price—To

per

—4112 Aurora

class of stock.

Industries, Inc.

(letter of notification)

to employees at $3.40

Oct.

Shoe

on\Dec.

will terminate

stock (par S2.50), of which 2,000 shares are to
share.

fbr each

stock one sjiare of
or for each? 2.0227

share of General

subject to acceptance of 80% of

Nov.

commop share

common;

preferred of General Shoe

common

General

shares of Berland preferred

($1

stock (par one cent) to be issued in units of
share of each class of stock. Price—51 cents
per unit.
Proceeds
For development and

(par $1) to be offered in units

principal amount of debentures and 23 shares of
Price—$359 per unit ($336 for the debentures and
share for the stock). Proceeds—For general cor¬

Coral

par

rate

common

—At

Hydrocarbons Corp.

Price—At

one

$1.50

series preferred stock (no par) being offered in exchange
for 30,000 shares of $10 par 6% cumulative sinking fund

common

Proceeds—

Nov. 5 (letter of notification)
550,000 shares of 5%
lative preferred stock (par 50
cents) and 550,000
of

Co.

share.

Hydrocap Eastern, Inc., Philadelphia, Pa.
stock.

to be offered in units of

per

Flagler St., Miami,
Co., Inc., Miami, Fla.

if Florida Towers Corp., Clermont, Fla.

Price—$1

For working capital.
Office—268
Fla. Underwriter—Curlette &

To repay bank loans. Underwriters

—

Mohawk

Nov. 25
stock

expire

both

stock

Nov. 23 (letter of notification) 50,000 shares of preferred

(par S4)

Put¬

Greyhound Parks of Alabama, Inc., Phoenix, Ariz.
Oct. 21 filed $400,500 of 6% 10-year cumulative income
debentures, due Oct. 1, 1962, and 40,050 shares of common

Chicago,

111.

$1)

—None.

Underwriter—None.

Federal

Firth

stock, together with proceeds from private sale of
$200,000 of series A bonds, to be used to repay bank loans

Building, Tampa, Fla.
& Co., Tampa, Fla.

Underwriter

—

Louis C.

McClure
f

Narragansett Electric Co.

(12/16)

Nov. 12 filed 150,000 shares of cumulative preferred

stock

Proceeds—For construction program. Under¬
competitive bidding. Prob¬
able bidders: Blyth & Co., Inc. and Harriman Ripley & Co.

(par $50).

writers—To be determined by

Inc. (jointly); White, Weld & Co.; Lehman Brothers and
Goldman, Sachs & Co. (jointly); Kidder, Peabody & Co.
and Stone & Webster Securities Corp. (jointly). Bids—
Tentatively expected to be received up to noon (EST) on
Dec.

16.

Nevada Tungsten Corp., Mina, Nev.
Oct. 22 (letter of notification) 1,000,000 shares
stock to be offered to stockholders.

mon

per

share.

of com¬

Price—Five cents

Proceeds—For working capital.

Underwriter

—None.
•

Newport Electric Corp., Newport, R. I.
6 (letter of notification) 5,955 shares of

Nov.

common

being offered to common stockholders on
new
share for each ten shares held on

stock (par $20)
basis

one

27; rights to expire on Dec. 14. Price — $31.50 per
share.
Proceeds^-To finance construction.
Office—15$.
Nov.

Thames St., Newport, R.
ster Securities

Underwriter—Stone* & Web¬

Corp., Providence, R. L

Continued

page

(2188)

■

Continued from page

Corp. (12 8)
notification) 50,000 shares of o5-cent
convertible preferred stock (par $5). Price—-

(letter of

cumulative

Mawr, Pa.

Bryn

Oct.

Omaha, Neb.
purchase plan
for employees of this company and of three subsidiary
companies, viz: Northern Natural Gas Producing Co.,
Independent Natural Gas Co. and Permian Basin PiPe~
line Co.; as well as employees of any other subsidiary
companies which may be designated. Underwriter
payroll savings

and stock

stock

17, N. Y.

New York

preferred

of common

stock

unit.
Wall

three common shares. Price—$10
Proceeds—For working capital, etc. Office—
St., New York City. Underwriter—East Coast

preferred and

one

vjter

it Orange Crystals, Inc., Oakland, Calif.
(letter of notification) 5,452 shares of

Nov. 19

lative
class

units

unit. Proceeds—For plant equipment and working
capital. Office—c/o Vacu-Dry Co., 950-56th St., Oakland
6, Calif. Underwriter—Goodbody & Co., New York.

per

Service, Inc., Dallas, Tex.

Petroleum

due

Proceeds — For
Underwriter—Garrett & Co., Dallas,

1963.

capital.

working

convertible

notification) $300,000 of 6%

Oct. 30 (letter of

debentures

Price

—

Buffalo, N. Y.

at rate of one new

par.

Tex.

held on Nov. 9;

share for each share

Philadelphia Electric Co. (12/10)
$20,000,000 of first and refunding mortgage
bonds due 1983.
Proceeds—For construction program.
Underwriters—To be determined by competitive

Porter-Cable Machine Co., Syracuse,

N. Y.

Natural Gasoline Corp.,

Texas

Tulsa, Okla.

(letter of notification)

•

Hydro-Electric Commission
debentures, series K, dated
1, 1953 and due to mature Dec. 1, 1978 (to be uncon¬
ditionally guaranteed as to principal and interest by
the Province of Quebec).
Price—To be supplied by
Quebec

Nov.

filed $50,000,000 of

Dec.

Proceeds—For new construction. UnderCorp.; A. E. Ames & Co., Inc.;
Harriman Ripley & Co., Inc.; Smith, Barney & Co.; Wood,
Gundy & Co.; Inc.; The Dominion Securities Corp.; and
McLeod, Young, Weir, Inc.; all of New York. Offering—

/amendment.

Writers—The First Boston

Date indefinite.

209,000 shares of common stock (par $1), of
which 134.000 shares are for the account of selling stock¬
holders. Price—To be supplied by amendment. Proceeds
sale of

—From

75,000 shares, for new

construction and

general corporate purposes. Underwriters—Carl M. Loeb,
Rhoades & Co., New York, and Dallas Rupe & Son, Dal¬
las, Tex.

Rochester

Telephone Corp.

(letter of notification)

Nov. 23

85,320 shares of common

cent). Price—At market (estimated at 45
cents per share).
Proceeds—To Harris T. Smith, VicePresident. Underwriters — Farrell Securities Co., New

Newark, N. J.; and others.

York; Alexander Reid & Co.,

Three States Uranium Corp.

156,250 shares pf common stock (par $10)
being offered for subscription by common stockholders
of record Nov. 19 at the rate of one new share for each
four shares held;

rights to expire on Dec. 7. Price—$12.50
per share. Proceeds—To repay bank loans and for. new
construction. Underwriter
The First Boston Corp.,
—

New York.

Price

—

Neb-Tex

per

share.

common

Proceeds

—

stock

• Titanium Ores Corp., Silver Spring, Md.
Nov. 27 (letter of notification) 300,000 shares of common
stock (par 10 cents).
Price—$1 per share. Proceeds—
For new equipment.
Office—8007 Takoma Ave., Silver
Spring, Md. Underwriter—Mitchell Securities, Inc., New
York.

(par one cent). Price—I2V2 cents per share.
working capital. Underwriter—Tellier &

stock

•

Tri

Dent Corp.

& Harris of

Chicago, 111.

may

Price—To

Mahlon

(Howard E.)

& Co., Inc., Indianapolis, Ind.

lative

preferred stock.

1,000 shares of 5%

cumu¬

Price—At par

($100 per share).
Office—2201 East 46th

Proceeds—For working capital.
St., Indianapolis, Ind. Underwriter—None.

stock.

exploration.
Wash.

Price

—

30 cents

Office—West

Underwriter

—

909

Mines

Wash.

per

share.

Sprague

Proceeds—For

Ave.,

Spokane

Financing, Inc., Spokane,

•

(par 50
Proceeds
with other funds, to be used to build pipe-)

line. Underwriters

curities

—

White, Weld & Co. and Union

Se*t

Offering—Postponed

Corp., both of New York.

indefinitely.

Ogden, Utah
3,000,000 shares of com¬
(par 10 cents). Price—5 cents per share!
Proceeds
For additional working capital, to acquire
leases, drill well, etc. Office—812 Eccles Bldg., Ogd'eii*
Utah.
Underwriter — Samuel B. Franklin & Co.,. Lo^
Angeles, Calif.
•
'
■:
Empire Petroleum Co.,

Western

Oct. 22

(letter of notification)

stock

mon

Wyoming Oil Co., Denver, Colo.
Nov. 3 (letter of notification) 5,000,000 shares of common
stock (par five cents). Price—5% cents per share. Pro¬
—

— 301 Kittredge
Robert W. Wilson„
"
• ;v.'
'
■ ,\j*

Office

For drilling expenses.

Underwriter

Bldg., Denver, Colo.

—

Denver, Colo.

Brooks &

Louisiana Pipe Line

Co.

stock

filed

subsidiary of American Natural Gas
Commission to authorize con¬
pipe line, to be financed
through the issuance of $97,500,000 of first mortgage
bonds, $12,000,000 of interim notes convertible to pre¬
ferred stock at option of company, and $20,500,000 off
common stock (par $100), the latter to be sold to parent,

Nov. 10 company, a

Co., asked Federal Power
struction

$130,000,000

Appalachian Electric Power Co. (1/11)
was announced company plans to issue and sell

Nov. 10 it

repay

—To

1984. Proceeds—To

bank loans and for new construction. Underwriters
determined by competitive bidding.
Probable

Halsey, Stuart & Co. Inc.; The First Boston
Kuhn, Loeb & Co. and Union Securities Corp,
(jointly); Harriman Ripley & Co. Inc. Bids—Tentativelyscheduled to be received up to 11 a.m. (EST) on Jan,
11. Registration—Planned for Dec. 9.

bidders:

Corp.;

Atlantic

City Electric Co.
President, announced that the com¬

Oct. 5 B. L. England,
pany

plans to issue and sell early next yeat about $4,-

(par $5).

supplied

574,321

the

Inc.

shares of common stock (par $1).
(either on the New York Stock

market

None.

When the
rior

basis of 6V2

shares of United

common

Merchants stock for each

preferred

share.

Underwriter

—

the

(Netherlands)
Oct. 9 filed ''A. K. U." American depositary receipts for
180,000 American shares representing 10,000 ordinary
Rayon Mfg. Corp.

problem is producing a supe¬

printing job against a
answer

thirty

years

Sorg

—

rush deadline,

specialists lor over

in financial, corporate and

legal printing.
We're

Statement effective Oct. 26.

United

each ordinary share of Hfl. 1,000 par
per

who

value. Price—$23.75

American share. Proceeds—To selling stockholders,
purchased the ordinary shares from the company,

additions to
plants and facilities. Underwriter—Lazard Freres & Co.,
New York. Offering—Scheduled for today (Dec. 3).
the

proceeds

used

•

Ensinger,

through secondary distributions). Proceeds
—To a group of selling stockholders who will receive
the said shares in exchange for outstanding preferred
and common stock of A. D. Juilliard & Co., Inc., on the

•

Prospective Offerings
American

equipped to handle design, print¬

ing, binding and mailing
roof,

with

all under one

day and night availability,

shares of A. K. U. at the rate of 20 American shares for

Silver Dollar Exploration & Development Co.
Aug. 20 '(letter of notification) 1,000,000 shares of com¬

-•

Price—To be supplied by amendment.

by amendment. Proceeds — To
President. Underwriter — P. W.
Co., Inc., New York.
be

Juilliard
Sams

Nov.

Maggio, Inc., New York.

it Union Wire Rope Corp., Kansas
City, Mo. (12/17)
Nov. 27 filed 21,000 shares
of capital

stock of

To acquire

Registration statement

Nov. 12. (letter of notification)

mon

(12/7)

stock

Exchange

revised.

(N. J.)

(letter of notification) 300,000 shares of common
(par 10 cents). Price—$1 per share. Proceeds—
For working capital and for general corporate purposes.
Office—128 Linden Ave., Jersey City, N. J. Business—
To manufacture a new toothbrush. Underwriter—Charles

Nov. 6

(par $1).

Co., to pay loans and for working capital.
Office—Northwood, Iowa. Underwriter—Sills, Fairman

Line Co., Dallas, Tex.
20 filed 1,125,000 shares of common stock

West Coast Pipe

$20,000,000 first mortgage bonds due

^Trad Television Corp., Asbury Park, N. J. (12/15)
(letter, of notification) 2,400,000 shares of com-

Nov. 25

Price—At

Oil

and

fering—Postponed indefinitely.

1, 1954.

United Merchants & Manufacturers,

April 23 filed 165,000 shares of

oil

crude

Junction, Colo. Underwriter
City, N. J. Offering—Not expected

it Thunderbird Ranch, Palm Springs, Calif.
Nov. 19 (letter Of notification)
1,000 shares of capital
stock (par $100). Price—$200 per share. Proceeds—For
working capital, etc. Address — P. O. Box Y, Palki
Springs, Riverside County, Calif. Underwriter—None.

Oct

Production Co.

mile

Office—354 Main St., Grand

None.
Saint Anne's Oil

be used to build a 1,030
pipeline. Underwriters—^-White, Weld &
Union Securities Corp., both of New York. Of¬

000,000 first mortgage bonds to

—

it Royal Appliance Manufacturing Co.,
Cleveland, O.
Nov. 24 (letter of notification) 2,940 shares of common
stock. Price—At par ($100 per share). Proceeds—To ac¬
quire properties and for working capital. Office—1825
Union Commerce Bldg., Cleveland, O.
Underwriter—

1,125,000 addi¬
private sale of $55,-

sale of units and

Proceeds—From

ment.

ceeds

(letter of notification) 2,000,000 shares of com¬
mon
stock (par one cent).
Price—15 cents per share.
Proceeds
For drilling, surveys and working capital.
Nov.

Co., Jersey City, N. J.

filed

one

—

Okla.

it Texo Oil Corp., Ardmore,

Proceeds—For

Oct. 30

to be

—Together

(12/15)

rmon

580,000 shares of common stock (par 50
offered in units of one $50 debenture and
share of stock. Price — To be supplied by amend-*
and

1964,

cents)

cents).

Nov. 24 filed

until after Jan.

4,600 shares of common
(no par). Price—$21.50 per share. Proceeds—To
Geraldine R. Denison, the selling stockholder. Under¬
writer—William N. Pope, Inc., Syracuse, N. Y.

Nov.

Pipe Line Co., Dallas, Tex.

$29,000,000 12-year 6% debentures due Dec.

Co.

and Allen & Co., New

Tellier & Co., Jersey

stock

West Coast

•

capital/Underwriters—Hamlin & Lunt, Buffalo,
York, W. C. Pitfield & Co.,
Ltd., of Montreal, Canada, has agreed to purchase 50,000
shares from the underwriters for distribution in Canada.
working

bidders:

Dec. 10.

share. Underwriter'

per

None.

tional shares of common stock and

bidding.

Halsey, Stuart & Co. Inc.; Morgan
Stanley & Co. and Drexel & Co. (jointly); The First Bos¬
ton Corp.; Kuhn, Loeb & Co.'; White, Weld & Co. Bids—
To be received by company up to 11 a.m. (EST) on
Probable

the rate of $27

7. Price—$5.25 per share. Pro¬
ceeds—To repay bank loans and other indebtedness, for
further
exploration of properties and for additional
rights to expire on Dec.

stock (par one
Nov. 13 filed

into company of Puget Sound Pow¬

share to holders who do not elect to re¬

common

ceive cash

15,

$1)

Aug. 31 filed 198,500 shares of common stock (par
being offered for subscription by common stockholders

$25) and. 1,088,939 shares of
issued in connection with

Light Co. on the basis of one-half share of pre-/
and one-half share of common for each Puget:

Nov. 20 filed

6% cumu¬

(par $50) and 54,520 shares of
A common stock (par 50 cents) to be offered in
of one preferred and 10 class A shares. Price—$55
stock

preferred

ferred

Sound

N. Y.,

Securities Corp., New York.

City.

Strategic Materials Corp.,

stock (par $1) and 89,958 shares
(par 10 cents) to be offered in units

cumulative

the proposed merger

Underwriter—None.

+ Oil Financing & Development Corp. (Del.)
Nov. 25 (letter of notification) 29,986 shares of 50-cent
'

1,088,940 shares of $1.28 cumulative con¬

stock (no par) to be

common

W.) Publishing Co., Columbia, Mo.
notification) $86,250 of deferred obli¬
gations (non-interest bearing). Purpose — To liquidate
1,725 shares of preferred stock presently outstanding.

Business—Manufac¬

Underwriter—None.

Calif.

vertible preferred stock (par

it Stephens (E.
(letter of

Office—475 Fifth Ave.,
Underwriter—None.

Washington Water Power Co.

Nov. 24

sells fastening devices.

tures and

Street, New York

Broad

explore foreign

land, Los Angeles Harbor,

Proceeds—
Underwriter—Arthur R. Gilman, 20

drilling costs.

For

per

common

May 7 filed

$125,000 of 6% con¬
1964, being offered for
subscription by common stockholders at rate of $125
of notes for each four shares of stock held as of Nov.
16; rights to expire on Dec. 16. Price—100% and ac¬
crued interest from Jan. 1, 1954.
Proceeds—To reduce
equipment,
patents and for working capital.

each

bond, plus 23,«

preferred share, and $3 per, bond for
share. Office—772 Tuna St., Terminal Is¬

cents in cash,

of common

notification) 300,000 shares
(par five cents). Price—$1 per share.
(letter of

shares of common stock of West Coast

Packing Corp. at the rate of 80 cents per

Co.

Sta-Tex Oil
Oct. 2

purchase

stock and 66,983

Investment Co.
Nov. 4 filed $700,000 of 5%% capital debentures, series
B. due Dec. 1, 1963. Price—92 V2% and accrued interest.
Proceeds—For working capital. Office—Amarillo, Tex.
Underwriter—The First Trust Co. of Lincoln, Neb.

Nylok Corp., New York
Oct. 30
(letter of notification)
vertible serial notes due Jan. 1,

loans,

Nov.

stock.

Southwestern

None.

bank

it Van Camp Sea Food Co., Inc.
;
19 (letter of notification) five-year 5V2%. bonds to
be offered in exchange for 119,385 shares of preferred

of com¬

Price—At par (25 cents per share). Pro¬
ceeds—For machinery and equipment.
Underwriter—
E. W. McRoberts & Co., Twin Falls, Idaho.

Natural Gas Co.,

filed

Dec.

notification) 1,000,000 shares

(letter of

mon

New York.

• Northern

Co., Hailey, Idaho

Snoose Mining

(par one cent).

stock

Ashville, N. C.

Underwriter—McCarley & Co., Inc.,

N. C.

receivables ana
Lancaster Ave.,
Underwriter—J. G. White & Co., inc.,

$5.75 per share. Proceeds—To increase
reduce bank loans. Office—765 West

(letter of notification) 833,333

Nov. 10

Nov.

American Acceptance

North

•

shares of common
Price—Six cents per share. Pro-'ceeds—To equip and survey properties and for working
capital. Office—702 Walker Bank Bldg., Salt Lake City,^
Utah.
Underwriter—Cayias Brokerage. Co., Salt Lake
City, Utah.
•/•'■ ■:,
' ""

subscription agreements
for 2,000 shares of common stock. Price—At par ($50
per share). Proceeds—For studio remodeling. Address—
Radio Station
WLQS, Battery Park Hotel, Ashville,

City, Utah

Uranium, Inc., Salt Lake

Skyway Broadcasting Co.
6 (letter of notification)

■

Nov. 20

December 3, 1953

Financial Chronicle... Thursday,

The Commercial and
44

SORG

PRINTING CO., Inc,

80 SOUTH

ST., \EU YORK 58, IVY,

it for capital

yfinanciai,

r(;orfw*ate SPiintM

-Number 5278

Volume 178

new

ers

l-for-10

The Commercial and Financial Chronicle

bonds and make an offering to stockhold¬

000,000 of
raise

...

basis

sufficient

common

stock

construction program. Underwriters—For common
may

Co.

$3,000,000. Proceeds—For

additional estimated

stock
&

Corp. and Smith, Barney
Previous bond issue was placed privately.

Securities

be Union

bidding. Probable bidders:
Morgan, Stanley & Co.; Harriman Ripley & Co. and The
First Boston Corp. (jointly); Lehman Brothers.
Bids—
To be received up to

Atlantic

Refining Co.

Nov. 24 it

reported that proposed debenture issue

was

year

000 construction program.

Underwriters—Smith, Barney

Commerce

Interstate

Aztec Oil & Gas Co.

Baltimore & Ohio RR.

is planning to issue $60,000,000 of new collateral trust 4% bonds to mature in
l-to-16 years in exchange for a like amount of collateral
trust

bonds

due

company

Jan.

1, 1965 now held by the Recon¬
struction Finance Corporation. The latter in turn plans
to offer the

bonds to

new

group of investment houses

including Halsey, Stuart & Co. Inc.; The First Boston
Corp.; Merrill Lynch, Pierce, Fenner & Beane; Alex.
Brown & Sons; and others.
The bankers would then
offer the bonds to the public.

Oct. 30 it
sell

Illinois

Electric

Gas

Co.

Oct. 5 it

company intends to offer and
to 70,400 shares of common stock to
an-issue of 15,000 shares of cumulative

(in addition

stockholders)

preferred stock,

$100, later this year and $4,000,000
bonds about the middle of 1954. Pro¬

par

of first mortgage
ceeds

—

bank loans and for

repay

.Underwriters

•

construction.

new

Corp., New York. (2) For bonds—To be
by competitive bidding} Probable bidders:
Halsey, Stuart & Co. Inc.; Stone & Webster Securities
Corp.; Kidder, Peabody & Co. and White, Weld & Co.
(jointly).
determined

Maine Power Co.

struction

and

Co., Inc. and Kidder, Peabody
Burr, Inc.; A. C. Allyn & Co.,
Bear, Stearns & Co. (jointly); Harriman Ripley

Inc. and

Co., Inc.

.~V'

basis

$100 of debentures for each

capital stock held. Proceeds—For
to

con¬

new

bank loans. Underwriter—None.

repay

'• *

-v

rv*

Underwriters—May be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co Inc *
Morgan Stanley & Co.; White, Weld & Co. and Salomon
Bros. & Hutzler (jointly).
poses.

was

collateral

—

plant.

McBride Oil & Gas
Corp.,
8 it was announced that

early registration is ex¬
of approximately
$5,000,000 of common stock.
Price—Expected to be about $2 per share. Proceeds—

pected

For expansion

body & Co. (jointly); Glore, Forgan & Co. and Harriman
Ripley & Co. Inc. (jointly).

•

ment trust certificates to be dated Jan.

annually 1955-1969, inclusive.

15, 1954 and due

Probable bidders: Halsey,

Co.

Inc.; Salomon Bros.
Co.; Blair, Rollins &

Hutzler; Kidder,

Co.

Sept.

reported

was

plans

company

issuance

and

of $4,000,000 30-year first mortgage bonds. Under¬
writers — May be determined by competitive bidding.
Probable

bidders:

Halsey, Stuart & Co. Inc.; Lehman
Merrill Lynch, Pierce, Fenner & Beane and
Union Securities Corp. (jointly).
Brothers,

Fire Association of
Nov.

was

stock

certificates, series, RR, to be dated Jan. 1, 1954, and ma¬
ture
in 30 equal semi-annual instalments of $255,000
each. Probable bidders: Halsey, Stuart & Co. Inc.; Salo',mon Bros.; & Hutzler; Kidder, Peabody & Co.; Blair,
.

Co. Inc.

/..

Feb.

before

Philadelphia

announced

111.) for the purchase from it of $7,650,000 equipment trust

18, 1954, the right to subscribe

for

(par $10)

340,000 additional shares of capital
the basis of one new share for each

Price—Expected to be $22.50 per share. Pro¬
capital and surplus. Underwriter—
None, but The First Boston Corp., New York, will act as
advisors to the company.
Meeting — Stockholders will
increase

ceeds—To

vote Jan.

...

14 on increasing authorized number of shares
360,000 (340,000 outstanding) to 800,000.

reported company, a subsidiary of Colo¬
Co., plans issuance and sale of about

General Tire &

Rubber Co.

Oct.

vote

approving a proposal to authorize 350,000 shares
par preferred stock. There are said to be no

stock. Proceeds—For exploration
Underwriter—Union Securities Corp.,
Offering—Expected early next year.
common

and development.
•

*•

$100

was

announced

present plans for issuing

stockholders

Dec.

will

of these shares when auth¬

any

orized.

...

.<:• Commercial State Bank & Trust Co. of New York
Nov.

Co.,

Ladenburg, Thalmann & Co. and Wertheim &
(jointly); Merrill Lynch, Pierce, Fenner & Beane.
Kidder, Peabody & Co. and White, Weld & Co. (jointly):

The

of record were offered 11,000 ad¬
capital stock (par $25) on a l-for-5
basis held with rights to expire on Dec. 10.
Price—$45
"per share.
Proceeds—To increase capital and surplus.
shares

Houston

Sept.

Commonwealth
25

Nov.

Edison
Illinois

Northern

Co.

Gas

Public

plans

issue

'-early in

Service

Co.,

and

sell

Company
$60,000,000

1954. Underwriters

—

subsidiary,

division.
of

This

mortgage

The First

was

Edison Co.

Nov.

York,

Inc.

ceived up to noon

Boston

bonds
Corp.,

the

bank

for

and

ders:

The
Jan.

new

company

planning

Proceeds—To repay

construction.

Underwriters—

by competitive bidding. Probable bid¬

Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.;
First

Boston

Corp.

Bids—Expected to be received

12.

Consumers Power Co.

Commission

for

authority

common

basis of

one

offer

679,436

additional

stock to shareholders for subscription

share for each 10 shares held

7, 1954; rights to expire

of Jan.

Jan. 22, 1954.

Unsubscribed

shares will be offered first to employees.

Price—To be

determined by company

Proceed,s-/-For

Dec. 7.
RR.

(12/9)

Bids will be received by the
company up to noon (EST
on Dec. 9 for the
purchase from it of $6,600,000 equip¬
ment trust certificates to mature in
l-to-15

years.

additional

Probable
Bros.

$6,600,000

certificates

will

offered

latef

bidders:

Halsey, Stuart & Co. Inc.; Salomoi
Hutzler; Kidder, Peabody & Co.; Blair, Rollin.

& Co. Inc.

Sept. 21 it
sale

and announced

construction

reported that company plans issuance am
$3,000,000 bonds. Underwriters—May \

was

about

determined by competitive
bidding. Probable bidden'
Halsey, Stuart & Co. Inc.; Merrill Lynch, Pierce, Fenne
& Beane and Union

Securities Corp.

(jointly); Lehma-

Brothers; Kidder, Peabody & Co.
•

Northern Illinois Gas Co.

See Commonwealth Edison Co. above.
1

■

•

;

*' U

•

March 23 it was reported that this
company plans t/
finance its proposed 1,300-miles
pipeline from Canada t»
the Pacific Northwest by the issuance and
sale of $66,
000,000 of 41/2% first mortgage pipeline bonds to insur

companies and other institutional investors and
$9
000,000 of 5% debentures and 1,400,000 shares of commof
$10 per share publicly in the United States am

ance

Canada.

„

Underwriter—Morgan Stanley & Co., New York

fi¬

new

Inc.; Kuhn,

Ohio Edison

Co.

(1/13)

Nov. 19 company sought SEC
approval to offer for sub

scription by its
on

common stockholders of record Jan. 1l-for-10 basis, 527,830 additional shares
of commoi

Power

stock

(with

oversubscription privilege).

Price—E>

to be named on Jan. 11.
Proceeds—For cor.
struction
program.
Underwriters—To be determine^

Co.

mission

that

this

company

finance construction of
Snake

River, Idaho.

plans

raise

$184,550,000

three hydro-electric projects

If approved, the financing will

and $52,150,000 of common stock.
financing period, the company would
$29,000,000 of short-term loans. Final
financing details would depend on market conditions.
preferred

competitive
bidding.
Probable
bidders:
Morga.
Stanley & Co.; Lehman Brothers and Bear, Stearns
Co. (jointly); The First Boston
Corp.; Merrill Lyncl
Pierce, Fenner & Beane and Kidder, Peabody & C

(jointly); Glore, Forgan & Co. and White, Weld & (
(jointly). Bids—Expected to be received on Jan. 13

stock;

Ohio Edison Co.

Throughout the

borrow and repay

Nov.

ceeds—For
Illinois Central
Nov.

bonds

was

RR.

reported

struction.
company

may

sell

issue

debentures, the proceeds of which will be used,
in part, to redeem on Feb. 1, next, the outstanding $34,743,000 4%% debentures due 1966. Underwriters—May

tive

be determined by competitive

bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co., Harriman
Ripley & Co. Inc., and Union Securities Corp. (jointly).

(1/19)

applied to SEC for authority to isl¬
and sell $30,000,000 first
mortgage bonds due 1984. Pr
company

repayment of bank loans and for

new

Underwriters—To be determined by compel

bidding. Probable bidders: Halsey, Stuart & Co. Inc

Morgan Stanley & Co.; The First Boston Corp.; Gloi
Forgan & Co., White, Weld & Co. and Union Securiti.

Corp.

(jointly). Bids

—

Expected to be received

about Jan. 19.

(1/6)

Oct. 30 company filed an application with Michigan P. S.

shares of

some

consist of $105,000,000 of bonds through 1962; $27,400,000

and sell $35,000,000 of 30-year first and refunding

loans

plans

Aug. 6, officials of Blyth & Co., Inc. and Bankers Trust

mortgage bonds, series J, due 1984.

To be determined

company

Co., New York, testified before the Federal Power Com¬
to

apply to the New York P. S. Commission for authority to
issue

(EST)

York, New Haven & Hartford

pected

unit

(1/12)

reported

was

Stuart & Co.

Idaho

New

reported

Loeb & Co.; Union Se¬
Brothers; Smith, Barney & Co.;
Kidder, Peabody & Co.; Equitable Securities Corp.

properties of

gas

Halsey, Stuart & Co. Inc., and Glore, Forgan & Co.
Consolidated

Lighting & Power Co.
was

curities Corp.;; Lehman

incorporated in Illinois to acquire the
Edison's

nancing to provide funds for its construction program.
Bidders for about $25,000,000 of bonds may include Hal¬
sey,

•

First Boston Corp.; Harriman
Ripley & Co., Inc
Goldman, Sachs & Co. (jointly). Bids—To be re¬

and

stock at

24 stockholders

ditional

Jan.

Northwest Natural Gas Co.

$20,000,000 of

(12/7)

S. District Court authorized
Bartholomev
trustee for International

North Shore Gas Co.

rado Interstate Gas

York.

System

Lehman

Co.

Colorado Oil & Gas Co.

New

the U.

(jointly);

Hydrox-Electri'
125,000 shares of NEES common stock.,
1,' 1954 in order to establish a tax loss
Underwriters—To be determined by competitive
bidding.
Probable bidders: Blyth &
Co., Inc., Lehman Brother,
and Bear, Stearns & Co.
(jointly); Carl M. Loeb, Rhoader

(1/18)

company plans to offer to -its

share held.

from

was

reported company plans issuance and sale

England Electric

New

sale

Brickley,
System, to sell

Inc.

County Electric Co.

stockholders Jan.

12 it

was

and

New

Dec.

(12/10)

Bids will be received by the company up to noon (EST)
on Dec. 10 for the purchase from it of
$5,400,000 equip¬

Bryan

$6,000,000 of bonds. Underwriters—May be de¬
termined by competitive
bidding. Probable bidders: Hal¬
sey, Stuart & Co. Inc.; Merrill
Lynch, Pierce, Fenner &

before

Essex

—

of about

The
Kidder, Pea¬

Underwriter

program.

Mystic Valley Gas Co.
Sept. 21 it

Co. and Stone & Webster Securities Corp.
(jointly);
First Boston Corp., White, Weld & Co. and

Houston, Tex.

Nov.

writers—To be determined by competitive bidding. Prob¬
able bidders:
Halsey, Stuart & Co. Inc.; Estabrook &

Erie RR.

bottlin*

Underwriter—None.

Union Securities
Corp.
Brothers; Kidder, Peabody & Co.

announced company plans sale of $7,000,trust mortgage bonds due 1973.
Under¬

Bids will be received by the company up to noon (CST)
on Dec. 17. at Room 744, Union Station Bldg., Chicago 6,

Rollins &

Brewing Co., Los Angeles, Calif.

was announced
company will offer 400,000
additional shares of common stock to its
stockholders at
rate of four new shares for each
share held. Price—$5
per share.
Prcoeeds
To help finance a new

•'

Pacific RR. (12/17)

Nov.

retire

Beane

Eastern Utilities Associates

^ Chicago, Milwaukee, St. Paul &

was reported that the
company may issue and v
issue of bonds late in 1954.
Proceeds—To

was

Probable bidders: Blyth &
& Co. (jointly); Coffin &
&

the

Offering—Expected in January.

first quarter of

25 shares

Peabody

reported company plans sale during the
1954 of $10,000,000 common stock after
distribution by New England Public Service Co. of its
holdings of Central Maine Power Co. common stock.

sell

Houston, Tex. /

Detroit Edison Co.

Stuart

Oct.

$10,000,000 of first mortgage and collateral
Proceeds—For construction program.
Un¬
be determined by competitive
bidding.

Nov. 30 directors announced that company plans to
off-^r
to its
stockholders $43,358,000 of
15-year convertible

ster Securities

\
Central

plans to issue and sell

bidders:

debentures

Nashville RR.

April 18 it

Halsey, Stuart & Co. Inc.; The First
Boston Corp. and Blyth & Co., Inc.
(jointly); White,
Weld & Co. and Shields & Co. (jointly); Union Securi¬
ties Corp.; Lehman Brothers; Morgan Stanley &
Co.;
Kuhn, Loeb & Co. and Salomon Bros. & Hutzler (jointly);
W. C. Langley & Co.

(1) For preferred stock—Stone & Web¬

—

share.

per

Light Co.

announced company

was

Probable

000

announced

was

(12/14-18)

Price—$8

Nov. 12 it

Maier
Delaware Power &

Feb. 20 it

Central

Commission.

Louisville

$24,610,000 Atlanta, Knoxville & Cincinnati Division
4%
bonds due May 1, 1955, and for
general corporate pur¬

derwriters—To

Aug. 11 it was reported company's common stock (held
by Southern Union Gas Co.) may be offered to stock¬
holders of the parent company on a pro rata basis under
a proposed divestment plan.

reported

Jan. 6.

Underwriter—Shields & Co., New York.

trust bonds.

was

announced company plans to issue and sell

was

in 1954 about

& Co. may head group.

Nov. 9 it

(EST)

a.m.

250,000 shares of common stock, subject to approval of

will be around $60,000,000. The exact
nature and timing of the financing are still to be deter¬
mined. Proceeds—To be used to help pay for a $100,000,early

ir Continental Transportation Lines
Dec. 2 it

•

(2189)

be determined by competitive

program.

Jan. 4, 1954.

Underwriters—To

Iowa-Illinois
Nov.

was

Gas

reported

Electric
company

Otter Tail Power Co.

Co.

plans

issuance

and

sale of 40,000

shares of preferred stock (par $100). Pro¬
repay bank loans and for new, construction.
Underwriters—If by competitive bidding, they may in¬

June

FPC

of $4,000,000

authorized

company

to issue

clude:

The First

Boston

Corp.; Lehman Brothers; Blyth
& Co., Inc.; Kuhn, Loeb & Co.; Glore, Forgan & Co.;
Merrill Lynch, Pierce, Fenner & Beane and White, Weld
& Co. (jointly); Harriman Ripley & Co., Inc.; Salomon
Bros.

& Hutzler.

Offering—Expected in January.

proceeds

company's

provide

1953r

funds

maxim 1,

banks, t:

temporarily finance

and 1954 construction programs prior *

arranging for long-term financing.
be

unsecured promissory notes to

ceeds—To

Underwriters—JVL

Glore, Forgan & Co. and Kalman& Co.

Continued

page

The Commercial and

(2190)

Continued

from

struction.

Pacific Northwest Pipeline Corp.

Corp.; Glore, Forgan & Co.; Harriman Ripley & Co. Inc.

Pacific
the

New York

bonds and preferred and common
Weld & Co. and Kidder,

pipe line

Halsey,

13 it

Oct.

Bros.

Pacific

Halsey,

Stuart

Co.

Hutzler; Kidder, Peabody &

& Co.

Hutzler.

Inc.; Harriman Ripley & Co., Inc. and Union Se¬

Salomon

Inc.;

Bros.

See

sell

its

announced

was

stockholders

capital stock

1,004,603

l-for-7 basis.

on a

plans to issue and

company

Aug.

sell about

additional

Price—At

share.

Proceeds—To repay bank loans.

None.

American

Oregon.

Not expected

ferred

Underwriter—

Telegraph Co.,

Service

announced

was

Co.

Bids

plans

company

issue

ana

offered

first

common

stockholders

basis).

Offering—

Underwriter—Dillon,

Read

Offering—Expected in January

Co.,

l-for-13

New

February

Nov. 10 it
and

Co. of

was

Indiana, Inc.

reported the

sell $25,000,000

Sept. 28
sale

is planning to issue

company

ing

somebody evident¬

ahead

didn't look far enough

when

the

Assn.,

about

debentures

Motors'

General

Bankers

Investment

sat this week for

a year ago,

its annual convention.

1954.

With 1,200 or more of its mem¬
Florida

the

business

issue

new

market,

the

emisssions have not been received
in

destined

manner

those

cheer

engaged in the task of dis¬

making

backs

Bankers
six

plus

underwriting

fraternity,

is not quite

glum

might be expected under the cir¬
cumstances.

General

since
ago,

300

has

recognized

Motors,

fortnight

announced plans for floating
million

loom

roadblock

for

other borrowers until it is out of

tentatively for the middle of
week, the big GM issue has

aroused wide investor interest and
the

apparently is to
other offerings in
the

off

hope of getting substantial allot¬
ments of the

GM
debt

has

folios, if
are
right.
fund

issue

offers

for many port¬

expected,
An

funded

the

attractive

terms

Those who

nationwide syndicate of

270 houses, plus distributing

fpil

coverage

ment field appears

new

some

balances

stayed

shares of

issue

market

estimates of

remaining

hands

And

their

make

right

pleasant
off.

did

reading,

that

calculated

was

not

that

000,000 and $65,000,000 unsold in
hands of

those

groups

which

dividends,

the elements which

ing

efforts

from such

The big hope
if

the

is, of

General
out with

course,

Motors

celerity

that

offering
numerous

investors who have been counting
on

this

ing

one

over

Everybody will be back home

South¬

share*

NOTICES

are

quarterly dividend of
one and
three-quarters per cent was declared
on the Preferred Stock of this Company, pay¬
able January 2, 1954 to Stockholders of record

among

discourag¬

are

the close

business

December

Transfer books will remain open.
be mailed.

capital

secure

New York 8, N. Y.

132

Common Dividend Nos. 117

1953.

17,

Checks will

Dividends

($1.75)
of

per

twenty

Common

dollar

one

end

year

118

five

cents

the Preferred Stock and

five cents (25^)
Stock

and

seventy

this

per

Company

declared, payable January

dividend of forty

If corporations

(40^)

cents

new

vice

capital would accept the ad¬
of

the

industrial

securities

sale

equities

through

rather

than

securities.

THE

ATCHISON*,

SANTA

New

the close of business

December 7r

Board

dividend

Directors has

One

for

the

holders

said

York

Rates

Stock

the

Exchange

commission rate

New

—

booklet—Asso¬

Stock

Exchange

($1.25)
the

payable March 2,
the

York

Broad
N.

Street,

(quantity prices

New

(paper),
on

600

Manual

addition,

Dollars

No.

Commercial

the
164,

tion

1954

—

Stock

Com¬

books

business

Dividend No.

191

Common

Dividend No.

131

quarterly

(1 /2%)

January

dividend
the

75c

per

Preferred Stock

for

Board
for

the

business

declared

1953,

year

Two

the

Stock have been declared.

extra

Company,

are

Reporting

the

York

association's
com¬

December

payable

record

January

at the

1953.

11.

Broadway,

New

York

Both dividends

trans¬

fer books will remain open.

WILSON, Assistant Treasurer,

120

Page, Secretary and Treasurer

November 25, 1953

(cloth, $10.00).
Dangers of Treaty Law—Frank E.
Holman—Foundation
nomic

Education,

charge

request.

As¬

Conditioning
111

West

Washington Street, Chicago, 111.
—$1.75.

meeting
of

The

Y.,

the

Board

Colorado

Iron Corporation,

(paper).

Council,

rectors

1953 Edition—

Tyler —Water

DIVIDEND
At

What Is Hard Water—Dr. Cornelia

f4 THE COLORADO FUEL AND IRON CORPORATION

copies;

Manufacturers

Mich,

CFJ

Irving-

sociation, New Center Building,
Detroit

rjPj

Eco¬

(paper);

single

Motor Truck Facts,

Automobile

Inc.,

for

payable January 2, 1954 to holders of

record December 7. 1953. The stock

Men, 229 Fourth

New

the

ending December 31, 1953 and

quarter

share on the Common Cap¬

to stockholders

1954,

National Associa¬

Credit

the

per

($2.00)

D. C.

Laws,

Preferred

Company,

of said

divi¬

Cents

dividend of 20f per share on the Common

dividend,
ital

request).

165,

1954.

Credit

to holders

No.

this

registered

at the

Company

the close

day

Twenty-five

Dividend

Stock

1954

Stock

Capital

this

and

Capital

Note

regis¬

1953.

31,

being

share,

Stock

Bank

net

1953,

30,

the Company at

Dollar

One

per

Common

29,

Firms,

dend

American

110,

undivided

Capital

declared

also

declared

Twenty-five

June

ended

December

Board

out

Preferred

the books of

business
The

Commission

day

aird

Stock of this Company,

1954,

year

Secretary

1953.

being Dividend No.

the Preferred Capital

profits

24,

this

Dollar

($1.25) per share,
1,

November 24, 1953

COMPANY

Ncvembjr

Y.,

AND

TOPEKA

RAILWAY

York.

payable February

Research

convention, this week, the

per

1953. These dividends

CARL A. SUNDBERG

quantity prices

planning to raise

been

Transfer books will not be closed.

1953.

ton-on-Hudson,

Equity, Less Debt

the

have

1954. A special

the Common Stock has been declared

payable December 28,
record at

debt

help with the task of sell¬

the

384.860

have been declared payable to stockholders of

will have to start look¬

the field.

seek to obtain such funds

Office

and

owns

$0 Churf b Streel

STOCK

sources.

Avenue,

of the invest¬
,•

Westpan

Full text of Commercial and Financial Chronicle : December 3, 1953, Vol. 178, No. 5278

FRASER