Full text of Commercial and Financial Chronicle : December 31, 1953, Vol. 178, No. 5286

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& Happp JSeto fJear to

&ll

Commercial

e

Reg. U. S Pat. Office

Volume 178

Number 5286

New York 7, N.

EDITORIAL

Price 40

Y., Thursday, December 31, 1953

We See It

As

The Changing Stock

On 1954 Business Outlook

a

Paine, Webber, Jackson & Curtis, New

"recession"

a

Economic Forum of the National Industrial Conference
Board reveals

majority of the panel

a

definite

sectors

reproduced in
along with summarization of viewpoints by
Martin R. Gainsbrugh, the Board's chief economist.
moderate

decline

important,

it

or so

John S.

tive

He

in

as a

event without harmful side effects.

to be done in these

some

other time give

Guests

lower

premises. What he

excise and

a more
John

face of threatened

Thomas

depression, and that hence it

occur

next

spring.

He would

Continued

Sinclair

on

page

of

Dunlop,

outlook
sary

Radio

and

S.

Television

Broadcasters;

Economics,

of

Professor

Employee - Employer
Department, National
Harvard

Holden, Vice-Chairman,

F.

cultural

Economics,

S.

U.

Department

of

T.

Continued

below

the

in

and

market

for

Amer¬

60 age
force won't
show much change over
the next
decade. Expressed another way, the

University;

groups;

18,

and

over

:

working

our

B.

Sidney

big increase will be in the ranks of the consumer rather
producer.
I'm sure you're also familiar with the

Continued

on

page

of Business

on

page

Lurie

than

*

22

new

Agriculture;

Louis J. Paradiso, Chief Statistician, Office

go

past

capacity to produce.
Equally.!
significant, the greatest proportion¬
ate increases in population will be

Statistical and Historical Research, Bureau of Agri¬

of

.

neces-

physical

and

words,

•

business

the

ica's

Dodge Cor¬

W.

other

In

you are

the

have

materials

raw

tremendous

Rela¬
Asso¬

John

in

we

prospective population gains spell a

Columbia

Marketing,

because

facilities.

S. Alexander,

tq all of

factor

dynamic

a

poration; Nathan M. Koffsky, Associate Head, Division

tration not to interfere with such reductions now
to

rector,
tions

clearly the duty of Congress and the Adminis¬

scheduled

S.

ciation

con¬

on

of

R.

an

,

summary

a

active

your

the trends familiar

Gainsbrugh,

R.

an

vigorous economy.

joying would be alarming; in India
and
China, for example, it might '1
mean
starvation.
Here,
however,

University; Richard P. Doherty, Di¬

now says

similar taxes

included:

Professor

sumption would be an excellent preventive in the

is

Martin

by

with

permission I'd like to discuss five factors
important bearing on the outlook for our
economy—and the stock market.
In other countries,
the population growth we are en¬

dustrial Conference Board.

any

probably will at

that

With

which have

Chief Economist of the National In¬

preven¬

complete account of his ideas about what ought
is

Concludes,
a

The 14 participants in the Forum,
comprising guests and Forum mem¬
bers, are listed herewith, along with
the highlights of the remarks made
thereof

buys through investment institutions. Sees in this a
element of stability in stock prices, leading to a *

stock market is synonomous

Sinclair, President, The Con¬

by each participant and

*

buyer, the indirect investor,

issues, which demands correction.

The Eco¬

ference Board.

apparently in the thought

and (2) creation

.

disparity in values between high quality and speculative

nomic Forum viewing 1954 prospects
under
the
Chairmanship
of

prescription for the patient. He

that the treatment would work well

in New York City.

class of security

new

a

new

"was

apparently suggesting at least one specific for
an ailment which he is not
altogether sure the
so

business

Board

is

patient has. He does

of

activity for 1954 is
seen by a
majority of distinguished economists partici¬
pating in the latest "Evening with the Economists" held
under the auspices of the National Industrial Conference

to us,

seems

in

interrelated factors which have impor¬

the stock market and the economy: (1)

pattern are: (1) decline in speculation,
who

A

as

on

population growth; (2) redistribution of national income; and (3) development of new products and new
markets.
Added to these, in shaping the stock market

of the nation's economy in 1954

being given
more
than average consideration by many ob¬
servers of the
contemporary scene.
;
more

bearing

tant

1949

this issue,

the current situation and outlook is

But far

Mr. Lurie lists

moderate

a

depression. Highlights of views expressed by the fourteen
Forum participants with respect to outlook for various

as

now

is the Senator's

see

decline of activity in coming year, similar to the

stand, according to the Senator, who
possibility that it may presently
develop into a "depression" of more than trifling
magnitude and severity—or at least this is the
way the Senator is quoted as feeling. The Senator
is, of course, a learned and, in some respects,
even a brilliant economist. Hence his
appraisal of

things

sees

York City

President, New York Society of Security Analysts

Douglas is reported in the press as
being inclined not to take the current decline in
business activity as lightly as some of the other
public figures in Washington are reputed to do.
The downturn is to be labeled

Market

By SIDNEY B. LURIE*

Senator

i

Copy

a

.

Economists Present Views

a

Cents

28

ican

32

by Mr. Lurie at the Luncheon Meeting of the Amer¬
Statistical Association, Washington, D. C., Dec. 29, 1953.

An

address

the Index on page 3 vividly shows the wealth of informa¬

ON THE INSIDE—A glance at

the securities industry, investors and businessmen which
available in the Thursday "Chronicle" every week throughout the year.

tion of vital importance to
is

WESTERN

U. S. Government,
State and

NATIONAL BANK
of INDIA, LIMITED

Municipal

Bankers

Securities

to

the

Government

STATE

Burma,

Chemical

Pakistan,

Protectorate.

Authorised

Capital
Capital

Paid-up
Reserve

Coast to Coast

and

banking

THE NATIONAL CITY BANK

£4,562,500
£2,281,250

Fund

exchange

Bond

Net

LAMB0RN & CO., Inc.
NEW

STREET

To

T.L.Watson &.Co.

Active

Markets

Banks

Brokers

Commission Orders Executed

CANADIAN

Members N. Y. Stock Exchange
—

Refined

—

Liquid

Spokane
Western Cities

NATIONAL BANK
OF THE

CITY OF HEW

Goodbody & Co.
MEMBERS

Puget Sound

CANADIAN
BONDS & STOCKS

Power &




BRIDGEPORT

PERTH

AMBOY

Light Co.

COMMON

NEW YORK

STOCK

EXCHANGE

Doximox Securities
(orporaxioti
40 Exchange

Place, New York 6, N. Y,

IRAHAUPT&CO.
York Stock Exchange
Principal Exchanges

Members New
and

other

111

Broadway, N. Y. 6

WQrth 4-6000

DIgby 4x2727

YORK

DEPARTMENT

DIRECT WIRES TO MONTREAL AND TORONTO

Established 1832

other

On All

Teletype N Y 1-2270-X

American Stock Exchange

Exports—Imports—Futures

10

Canadian Exchanges at Regular Rates

sugar
Raw

CHASE

THE

Maintained

and

SECURITIES

BROADWAY

NEW YORK 4, N. Y.

and

CANADIAN

YORK 5, N. Y.
50

Dept. Teletype: NY 1-708

Dealers,

1915

Principal Exchanges
NEW YORK CITY
Denver

Los Angeles
'

also undertaken

WALL

Salt Lake City

business.

Trusteeships and Executorships

ESTABLISHED

50 BROADWAY •

OF NEW YORK

of

Bond Department

J. A. H0GLE & CO.
Members of All

£3,675,000

The Bank conducts every description
bond department

Direct Private Wires

Ceylon,

Kenya, Tanganyika,
Zanzibar, and Somali-

land

1

Bonds

SECURITIES

Aden,

Uganda,

bank & trust

company

India,

Municipal

OIL & MINING

BONDS

26, Bishopsgate,
London, E. C. 2

In

MUNICIPAL

in

Office:

HAnover 2-3700
Branches

99

AND

Kenya Colony and Uganda
Head

telephone;

State and

115

BROADWAY

NEW YORK

1 NORTH LA SALLE ST.
CHICAGO

Teletype NY 1-702-3

WHltehaU 4-8161

Boston

Teletype NY 1-2708

Telephone:

Enterprise

1820

i

2

(2626)

We position

participate and give their

Citizens Utilities

reasons

for favoring

(The articles contained in this forum

they to be regarded,

are

Copeland Refrigeration

as an

offer

Corporation

Puget Sound Power & Light

Stromberg Carlson

R.

J.

Reynolds Tobacco

logical

running against
may be recognized at the outset.
Con ve r sely,

Corporation
American

Stock

York 5

Teletype NY 1-583

BArclay 7-5660

market adver¬

cently.

Since 1917,

in

ffiPONNELL&fO.
Members
New

York

American

120

Stock
Stock

Exchange
Exchange

BROADWAY, NEW YORK 5
Tel.

REctor

Bassett Furniture Industries

Camp Manufacturing
Commonwealth Natural Gas
Dan River Mills

Life Insurance Co. of Va.

STRADER,TAYLOR & CO., Inc

chiefly

reper-

around

TWX LY 77

NORTH and SOUTH

health

angle

to

relative

Bell

RICHMOND, VIRGINIA
System Teletype: RH 83 & 84
Telephone 3-9137

in

in

1946,

from

1952

and

prospect that

promise to be sustained at

relatively

high

in-

consumer

levels.

have

costs

last

the

Leaf

leveled

to-

off

and

February,

standard

share,

by

from $2.90 last year,

up

to

been

has

profits

excess

about

hard

hit

taxes—equiva-

$1.30

With

year.

share for

per

a

characteristi-

cally stable market for cigarettes
in

prospect,

nomic

at

could

for

the

eco-

pretax

level,

this

could

basis,

expand

present

rate
or

extra

profits

to

about

$2.00

an-

promises

to

supplemented

disbursement next

The present $2 rate, at the

year.

The
the

Members

New

York

Stock

25 Broad St., New York

ftm: HAnover 2-9766

recent

shares

down
year

from
of

acute

has

49.

an

weakness

brought

the

earlier

high

The

time

to

Exchange

basically
4, N. Y.

Tele. NY 1-3222




rate

operation
and

to

annual

on

spe-

$1

11 0 n

Interest

to

after

We

50%

the

be

$100,000

Wilmington,
Delaware

taxes.

2 %%

at least

Due

for

fall

in

1953

are

addition

would

rarily
press

well

appear,

situated

is

market

price.

this

acquire

it

tempo-

adverse .developments

the

in

issue

issues,

when

Completion

to

a

large,

this

sum-

sizable

a

or¬

similar product at what

a

be

to

appears

of

contract

and renewal of

mer

der for

a

good

margin of

profit should produce better

Scan-a-graver

been

announced

cumbersome,

five-

to

"bugs"

of

out

two

are

In ad¬
to have

appears

its

the

in

make

past

years,

machine

Gordon Graves & Co.
30 Broad Street, New York

since

(1)

A

stock

the

reason

for

purchase

of

Fairchild Camera at present prices

de-

Consid-

WHitehall 3-2840

p\)R

technical
to

serve

virtually

4

Telephone

Unique

depressed levels:
substantial

stock, perhaps
the

less

or

which

458,000,

80% of

as

shares

odd

of

amount

much

as

of

stock

outstanding, is held by "insiders"
or substantial
long-term investors
who have
bought stock, mostly
above current prices,

the

company's

This

Fairchild's in¬

as

earning

power

other

investors

and

izes
to

that

means

creased

believing in
future.

long-term

material¬
attempt

buy stock, the amount for sale

at "reasonable"
to

limited

be

be

expected

prices

and

to

the

sell

may

prove

stock

time.

(2)

stock

times

it

sold

Call

o

for

At its present price around

the

in

considerably

above its apparent true value for
some

Investment

is

next

selling
year's

at

for

when

our
on

Japan
or

write

current

publications

Japanese securities

about

YAMAICHI

anticipated

full-scale

SECURITIES CO., LTD.
Established

pro¬

duction of the Scan-a-graver was
first announced.

Opportunities

may

earnings and at about half of what

principal

recommending

the

at present

earn-

the

more

considerations

18

But

2.50%

(and interest)

to

six-year head start on
competitors; for the
has been ironing the

company

six

been witnessed

three

i

1989

and

future

any

ings from military business than

or

1,

on

said

are

expensive

dition, Fairchild
a

have
two

Bonds

October

efficient

no

inaccurate by comparison.

nominal cash distribution. Tax selling appears to
have been heavy this year, probably because the stock has declined from a 1951 high of close

unprofitable

offer:

To Yield

have
B. K. Thurlow

customary

be firm.

Taxes.

the market. Similar devices which

estimates

this

from all present

Income

and

ma¬

additional
in opera¬

every

placed

At present there is

^as recommended in this column
Sept. 17, is Fairchild Camera and
Dsted 011 U*e Amencan Stock Exchange,

dividend

exempt

own

about

or

increase

for

offices

a

tion.

competitor

branch

our

oper¬

new

$600,000,

machines

to

Federal

plastic ma¬
engravings

for the

for

share

a

1,000

H.a~

„

wires

profits from

of

sales

share

a

1,000

Mobile, Ala.
Direct

Writh 1,500 machines

year.

NY 1-1557

Birmingham, Ala.

1953

by the end of 1954 the

close

a

Exchlange
Exchange

St., New York 4, N. Y.

New Orleans, La. -

out

of

end

should be producing at

of

chines

ap¬

machines

This price earn¬

is the tremendous potential growth

ings

in income from rental of the

,

regular

increased

net

present price of 37V2, yields 5.3%.

Oppenheimer & Co.

mg

profits

excess

sharply augument

dividend

an

with

expanded

an

of

general

share.

per

The

and

On

1954

$4.50

despite

trends,

earnings

be

Bought—Sold—Quoted

and

earnings should

size

company

with

INTERNAL SECURITIES

Vra ly iocus-

Stock

Stock

HAnovw 2-0700

With 2,500 machines the earnings
should be better than $2.50 and

price ceilthe price of
cigarette was to 40 and holders have been anxraised 38 cents per thousand.
ious to establish losses in 1953.
Reynolds Tobacco earnings for Military backlog is now close to
1953
are
estimated around $3.25 $70,000,000 and orders appear to
ings

nual

GERMAN.

in-

bil-

181

added

earnings.

Companies

ation

company

$1.30

$2 a share, for 1954 close to $3 a
lion
in
1940.
Future
expansion share, the stock is now selling at
should be motivated by popula- about 18, and the riqianagement has
tion
growth
and
more
people given official recognition to the
coming to smoking age each year, company's
increasing earning
To these underlying factors is the power
by paying a 10% stock

tax

And Successor

By the

field.

rentals

nat-

York

than

Earnings

billion

billion

321

elimination,

I. G. FARBEN

1,000

the

1954,

Jiai

better

record—395

basic

has been

this

CRAIGIE&CO.

proximately

25 Broad

even

coming in from

come

is

of

rate

were

should

terest

news¬

trend of cigarette usage
persistently upward. The
strong growth trend of cigarette
consumption is evident from the

the

ient

■F. W.-

annual

an

needed

investors

York

Free of the business cycle, con- 1948 and is now engaged in fullcentrating on a product which scale production.
makes the fullest use of "elecTaking all these factors into
tronic automation" to save labor
consideration, it is not difficult to
costs, Fairchild is a true "glamor"
conjure up a brilliant future for
stock, selling "ex-glamor" at a
conservative price-earnings ratio, Fairchild, but in our opinion there

The

MUNICIPAL BONDS

New

breakeven

terials

opin10n> * " a n ?J
was wnen it

smoking has been publicized periodically in the past.
The ingrained ' habit of smoking, however, invariably overcomes these
interim influences eventually and

per

CAROLINA

the

in

thousand to $3.50

per

with the elimination of

VIRGINIA—WEST VIRGINIA

recent

photoengravers' strike,

$500,000

in

tractive toaay,

excise

thousand next April 1 may be
postponed; (3) recent decline in
cigarette consumption.

bacco

Since 1932 Specialists in

the

further markets may be developed.
Production of the Scan-a-graver

de¬

re-

Federal

$4.00

for

taxes

scheduled

(2)

and
in

simul¬

Sl?ch
®,?ecia,{
situation,
even more at-

comes

Lynchburg, Va.
0

behind

per

The

American Furniture

I

from

2-7815

Trading Interest In

LD 39

price
this

market

revolve

(1)
published
medical
studies
again pointing to the hazards of
duction

of

paper

grees for

sub-

declined

the

predictions

New

Members American

Varying

August Huber

have

of

Steiner, Rouse &Co.
Members

1,400 machines should be in

de¬

terioration

Factors

smoking,

Corp.

Bought—Sold—Quoted

—

in

develop in

and

circulation

economic

basic position in the tobacco
industry is a strong one. The to-

stantially

rally to

market

calling

of

formance

stock

taneous

Manu¬

shares

year-end

the

Louisiana Securities

Camera and Instrument

Bradbury K. Thurlow,
Partner, Talmage & Co., New;
York City.' (Page 2)

at

With the failure of the custom¬
ary

periods of

bacco

THURLOW

Fairchild Camera and Instrument

during

facturer

K.

City
Members, New York Stock Exchange

tempo¬

sity.

Corp.

point in
profits two years ago. By the first
quarter of 1953 pre-tax earnings

New York

cigarette, R. J.
R e y n o Ids'

Rights & Scrip

the New York Stock Exchange

listed

is

common

Partner, Talmage & Co.,

"Camel,"
the
largest selling

Specialists in

on

Reynolds'

BRADBURY

points usually
present them¬

rary

Exchange

New

J.

that

such

1920

Tobacco—August
Spencer Trask & Co.,
New York City. (Page 2)

I would

R.

has

Alabama &

*

Reynolds

passed

selves

Member

Broadway,

the dividend,

ex¬

perience

Week's

1901), and possible

since

regard the shares as an attractive
new commitment lor investment
it, accounts at this lower price level,

advantageous
purch asing

New York Hanseatic

J.

Thursday, December 31, 1953

Huber,

investment quality pf t-^e Tywe
(dividends paid without inter¬
increase in

tide

taught

Strong Cobb

R.

nor

ering the earnings prospects, high

Spencer Trask & Co., New York City
Members New York Stock Exchange

however,

Associate

he,

The risk inherent in suggesting
an
issue
with a strong psycho-

Kerr-McGee Oil

Established

to

sell the securities discussed.)

to

ruption

Polaroid

particular security.

a

intended

not

are

...

Participants and

Their Selections

Fairchild
AUGUST HUBER

Green Mountain Power

Kentucky Utilities

This
Forum

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

Central Indiana Gas

Investors Diversified Serv. "A"

Commercial and Financial Chronicle

The Security I Like Best

and trade in

Central Public Utility

120

*^The

..

com-

elec-

are

Office Tokyo

Brokers

&

1897

—

111 Broadway,N.Y.6

Branches

48

Investment

Bankers

in line with stocks whose earnings

pany's "Scan-a-graver,"

Home

tronic photoengraver
rental

of less than $250

will perform
20

minutes

$100,000
with
do

an

which, for

a

a

month,

"by push buttons" in
what

a

conventional

photoengraving

plant

high-priced operator

only in

a

several

hours.

It

of these machines

rented

to

small

newspapers,

"saturation

10,000.

with

point"

Perhaps,

as

the

in
an

COrtlandtl-568#

supposed to be vulnerable to

business

declines, would

give little

pany's

or no

growth

to

seem

value to the

prospects.

com¬

When

one

considers what these prospects

are

and

how much

investors

are

has

Over-the-Counter

Quotation Services
for 40 Years

such opportunities (most of which

and

probable
excess

roughly

seems

paying in today's market for other

could be

publishers

which

can

been estimated that several thousands

ratio,

of

aftermath

seem

to
be

to

say

the

writer less

the least)

clear

why I

ha've

opportunity to repeat
for

dynamic,

perhaps it will
taken
my

National Quotation Bureau
Incorporated

this

Established 1913

reasons

46 Front Street

selecting Fairchild Camera

"The Security I Like Best."

as

CHICAGO

New York
SAN

4, N.Y.

FRANCISOO

Number 5286.... The Commercial and Financial Chronicle

Volume 178

West

(2627)

Germany's

INDEX

Remarkable Recovery

The

Changing Stock Market—Sidney B. Lurie

By HUGO H. HEKSCH

r

West Germany's Remarkable

Members, New York Stock Exchange
s

I

■

Mr.

The

Forecast

Heksch, in revealing the remarkable postwar economic
of West Germany, says industry has been completely

rebuilt and further expansion is in progress.
of advancement to the Currency Reform Act

itor nation in

of

European Payments Union.

—A.

Ascribes much

The
1

on

my

re¬

and

cent

In

the

elers

returning

countries.

The

from

European

economic

fi¬

and

nancial recovery of many of these
war-torn nations is continuing at
full

countries, particularly Hol¬
done remarkable re¬

ropean

land,

have

building
this

jobs,

section

pressed

and

the

large-scale

provements taking place.
nancial

status

postwar

to

help but be im¬

can

by

visitor

no

of the

peak.

The fi¬
is at

area

Most

im¬

nations

a

the

1953

million

$340

was

value

compared

of

$140 million, far above 1938's

These

gains

that

were

at

standstill in 1945.

completely destroyed

strongly relied

Never¬

upon.

they pridefully point to
farsighted and constructive

economic

Benson

C.

relatively stable, and the
people are expressing great confi¬

of Chancellor
Adenauer, Economics Minister
Ehrhard, and Finance Minister
Schaeffer. These men, with their
hard-hitting, free economy, procapitalism policies and the con¬

dence and

ues

flight, long

Minister's

longer

no

a

nightmare, is
Monetary val¬

issue.

an

are

of local

in the safety

assurance

currencies.

Goods

in

are

relatively plentiful supply in most
these

of

countries, and producers

able to meet national

are

ers'1.,, demands.

An

consum¬

of

aura

satisfaction and security is

spreading

over

Most

eral

and

his

Republic.
it

ago

years

time

of

German

what

Fed¬

could

has

not

done

been

Currency Reform
of
1948. Industry has been completely
The

modern equip¬

most

ment has been installed in indus¬
trial

plants.

Today, German busi¬

boast

nessmen

that

this recovery
industrial

their

boosted

has

ef¬

ficiency to levels well above those
their

of

principal

prewar

Now,

business

In

tions.
a
a

history,

expan¬

the keynote of all opera¬

is

sion

perhaps never before in

as

German

world

Frankfurt, for instance,
bank has built

renowned

15-story skyscraper to house its

A hotel, de¬

multiple operations.

stroyed in World War II, has been

increasing

rebuilt,

capacity

its

from 12 rooms to 350—all as mod'

be found anywhere in
the United States. And so it goes

-ern

as

may

99

6

>

•

where

market
is

free

currency

free

Deutsche

the

selling

almost at a par
with official German exchange.
German

Currency
In

With

the

public's
as

Europe

of

one

Federal

German

currency

Federal

Soundest

Now

now

Ramsey

(Ret.)

of

Re¬

10

Southern Production
12

12

BalL_

R.

Foremost Dairies

Landscape

American

14

Some Forces Cushioning 1954 Business Drop
—Charles A. Schmutz

Glass Fibers

15

Security—Canada's Internal Threat
Weir_

Gustin Bacon

vs.

—Brig. J. B.
Leave Taxes

16

„

They Are—Leon H. Keyserling

and

of

matter

a

1955—A

as

Bought

fact,

Schaeffer

Finance
his

realizes

S.

Kaltenborn

18

T. Faricy

BURNHAM AND COMPANY

21

*

j,

IIcw the Railroads Fared in 1953—William

Members New York Stock Exchange
☆

:!:

*

JOHN F. REILLY,
Economists Present Views

1954 Business Outlook______Cover

on

ton Leeds Contends High Rate of
Capital Gains Tax
Caused Treasury Huge Revenue Loss__
In Defense of Stock Dividends

—Walter

by allowing impor¬
products, includ¬
ing luxury items, and by increas¬
ing travel allowances to Germans
going to other countries.
Many
observers feel, however, that this
large credit balance could be put
to

of

more

more

in

Improvement

Production

figures contain still

striking comparisons. As of
October, 1953 the daily average
of hard coal production was 120%
of the 1938 figures, the monthly
output
textiles
1250 %,

of cement 200% of 1938,
140%,
electric
power

the total index of industrial

production

was

of what it

170%

Finally,

external

trade statistics highlight

Germany

was

able

to

attention

Particular
drawn to the
German

has

been

improvement in the

23

Guaranty Trust Co. "Survey" Questions Government's
Ability.to Avert a Recession

25

Output of Capital Goods in 1953 Estimated at $58 Billion

30

Regular Features
As We See It

■'*

Bank and Insurance

Business

Man's

Canadian

Cover

Stocks

Bookshelf

Coming Events in Investment Field

9

Recommendations

____8

Einzig—"A Briton's View of 1954 Prospects"

21

of the News—Carlisle

Bargeron

13

few

closed

issues.

to

True

any

new

enough,

a

government owned corpora-

26

NSTA Notes

g

News About Banks and Bankers____

Reporter's

Report

._

on

page

36

You—By Wallace Streete.

also

14;

Pattern

"Independence

in

the

Twice

Weekly

25

B.

Landscape" on
Canada's Internal

—

I

Drapers' Gardens, London,
land, e/o Edwards As Smith.

COMMERCIAL and

WILLIAM

CHRONICLE

DANA

York 7, N. Y.
to 9576

Albany

•

Manchester, N. H.

Boston
•

TELETYPE N. Y. L5

Chicago

•

Nashville

•

Glens Falls

•

Schenectady

•

Worcester

Possessions,

in

United

Territories

Union,

Dominion

Canada,

of

8.
of

$48.00

year;

In

per

$51.00

per

year.

Other Countries, $55.00 per year.

INCORPORATED

39

BROADWAY NEW YORK 6
WHitehall 3-3960

Thursday (general news and ad¬
Issue) and every Monday (com¬
plete statistical Issue — market quotation
records, corporation news, bank clearings,
state and city news, etc.).
Every

3,

111.

US

South

<*♦

(Telephone STate 2-0613);

1-4040 & 4041

NY

Other Publications
Bank

vertising

Offices'

Productions

W V. FRANKEL & CO.
U.

Members

States,

and

Teletype

Chicago

r

Walt Disney

second-class matter Febru¬

as

Pan-American

President

Thursday, December 31, 1953

Other




Eng-

Subscription Rates

York Stock Exchange

•

C.,

25, 1942, at the post office at New
York, N. Y., under the Act of March 8,1879.

1

HERBERT D. SEIBERT, Editor & Publisher
WILLIAM DANA SEIBERT,

E.

ary

Subscriptions

TELEPHONE IIAnover 2-4300

Stromberg-Carlson Co.

Copyright 1953 by William B. Dana
Company

COMPANY, Publishers

Park Place, New
REctor 2-9570

ST., NEW YORK 4, N. Y.

Corp.

Canadian

Security

vs.

Reg. U. S. Patent Office

Members New

Copeland Refrigeration

5

Reentered

BROAD

Manufacturing

2

page 16.

on

29

FINANCIAL

Spencer Trask & Co.

17

Remington Corporation

For many years we

25

,___

40

*See "A More Varied
page

Published

specialized in

Brunner

27

:

Washington and You

The

have

37

19

and

.

Co.

&

34

Prospective Security Offerings--..

.

American-Marietta

1-1825

20

;___

_________

Security Salesman's Corner..
.

Exchange PI., N. Y. S
1-1823

NY

27

Securities

The Market

40

NY

Teletype

5

.___

Our Reporter on Governments,

Public Utility Securities

HA 2-0270

25

Observations—A. Wilfred May

Threat"

Continued

recapture

Singer, Bean
& MACKIE, Inc.

31

Mutual Funds

Railroad

bonds.

*

Dealer-Broker Investment

Our

stocks and

8

Securities

State of Trade and Industry

practically

firm

27

The

the capital market was

maintain

225 unlisted

(Editorial)

Security I Like Best

German

We

trading markets in

The

ago

NY 1-3370

Dlgby 4-1680

20

G. Rowland Collins and Marcus Nadler Foresee
Need for
Easier Credit

capital market. It is here,

time

York 5

Teletype

Telephone
17

however, that several major prob¬
lems
remain unsolved.
A short

how West

1938.

in

Capital

German

Market

more

15 Broad Street, New

(Letter to Editor)

Buyers' Market in Homes Coming, Says George L. Bliss.

advantageous use if out¬

standing external German obliga¬
tions were retired instead.

Manager

Trading Dept.
☆

Indications of Current Business Activity

tations

Unlisted

11

Schloss

problem. Attempts are being made
this

'

•'

From Washington Ahead

solve

Sold

Critical Year in Labor Relations

—Howard

country's growing credit balance
is
becoming
a
major financial
to

—

16

up

foreign exchange re¬
serves of almost $1.7 billion.
Ger¬
many is now E'PU's leading credi¬
tor
nation,
with
a
surplus
at
present of $700 million—despite
liberal import policies.
As

Marietta

14

Merchandising—Walter E. Hoadley, Jr
Independence

Ger¬

has been able to build

many

gold

4-6551

9

recognized

Bank

NEW YORK

WHitehall

S. Wars

Europe's soundest, the

Reserve

WALL STREET,

-

Securities Now in Registration

on.

was

Swiss

the

in

measures

past years is seen every

Minister

Keynote

the

Is

day

com¬

petitors, France and England.
Expansion

in

taken

life¬

a

the

rebuilt.

recovery.

Justification of the stern

eight

than

thought

reconstruction

accomplish
since

major share of the credit

a

upon

Less

was

program

Germany's financial

Mark

superlatives,
Konrad

heaped

are

Adenauer

rapidly

Northern Europe.

returnees'

however,

self-

take
for

cash

Obsolete Securities Dept.

6

tinuously stable government must

port that currency
Einance

re¬

with

Action

_

Looks Ahead

DeWitt

junk 'singing

leave

Business Level Can Be Maintained by Aggressive

theless,
the

Revised

for

or

West Ger¬

freely admit that U. S. aid

mans

was

Taft

with

shouting Happy New Year!

The Role of Commercial Banks in Financing U.

—Gordon

were

Indus¬
out of factories

accomplished.

trial recovery rose

a

Ezra

in

blues,

5

Calls

A More Varied Pattern in the Canadian

remarkable

easily

4

Industry Should Have Greater Share in Nuclear Development
—Eugene M. Zuckert

with

$114 million.
not

1954—Roger W. Babson.

Industrial Atomic Energy—Dr. John J. Grebe

$95 million in 1938, while exports
were

strength—and at last showing

substantial results. The North Eu¬

October,

the

.—Julian Gerard Buckley

German Federal Republic imports

trip abroad confirm many of
glowing reports of other trav¬

Come

4

Family Prayer for New Year's 1954—Alexander Wilson

Aircraft Industry

markets.'.

prewar

Cobleigh__

of

ihtppy 2Uui Ilcav:

3

May___.

Situation

—Admiral

its

Half

■

Recovery—Hugo H. Heksch

Telephone:

Discusses position

expand

First

Wilfred

Farm

—Hon.

A

1

foreign investors in German securit

made

Eight—Ira U.

for

"

■

AND COMPANY

Cover

_

Anti-Depression Battle Mapped by Economists

of 1948, along
with boosted industrial efficiency which is well above that of
France and England. Points out Germany is now leading cred-

Observations

Income

•

recovery

:

Page

,

'

Partner, Oppenheimer & Co.

llCHTfllSTlllF

-

Articles and News

3

and

Quotation

$33.00 per year.
Note—On

the

rate

of

Record

—

Monthly,

(Foreign postage extra.)

account

of

made

in

exchange, remittances for for¬
New

York

PLEDGER

&

the fluctuations In

eign subscriptions and advertisements must
be

Direct

tunas.

LOS

Wire

to

COMPANY INC*
ANGELES

4

The Commercial and Financial

(2623)

swings

erty

The Income Eight
A brisk and

eight percent return

on

the

West

Oregon.

the possibilities of obtaining

$6

an

On

George Spelvin

Jan.

after

retire,

lifetime of labor in

a

manufacturing

65.

now

will

he

1954

2,

is

small

This

plant.

a

com¬

pany provided

pension—

no

just

$5,000

in

group

insur¬

ance

then

opulence; and what will he

for

living income meanwhile?
So in this search let's soft pedal

do

romantic

growth factors, and hunt
but, as far as possible,
durable income per dollar.

for

high

What

paid up). The

tries

other assets of

beatem

Spelvin

include
i

n

$5,000
savings

a

bank which he

proposed

spend

on;

modest

in

tage
Ira U.

cot¬

Tem-

wherein
and

he

Mrs.

plan to live out their sunset
will

a

pedro, Florida,

Cobleigh

Social

to

S

years.

equal $180

to

$85

Now Mr. S

missus

whence

they

month.

the

him.

his

bound,

are

He

his

a

com¬

clime,
$300

on

problem

least

at

so

quite

southern

Thus

simple—or

$100

figures he and

live

can

in

to

it

is

seems

has, from the sale of

in

house

Suburba, N. J., re¬
ceived $25,000-hi cash. That must
provide
the
remaining $200
a
month

down

far

so

coals,

have

got

too

as

current

a

a

down

heavy

a

Well

gamble,

oldster has

our

business getting booby-trapped
it.
Not, at least, so long as

no

in

other fields offer better
of

elements

stability.

for

the

living

style

the

thing

Another

Aspect

have to

sider before
is

we

get down to

we

inflation.

The

con¬

cases

and

woes

of the pensioners in the

squeezes

in

another

in
be

a

and

one

buying

since 1941, and somewhere
8%

our

ray

scheme,

there

should

of hope for offsetting

further

decline

power.

Obviously

If

any

in

purchasing
such a dollar

Holds, however, during first
1954, business will be fairly good. Makes 25 definite
forecasts, and predicts what Eisenhower Administration will do.
half of

consider
com¬

plus mineral rights
million

chain reaction would be set off.

a

you

down

I

do

not

theory

of

believe

now

most

business will fall off 10%

with

greater

a

supply $300
is by no

per

earnings. M y
feeling is that

able of

larger dividend

a

price

//I!##,

number

of .years.

V-v
'

%'K

imwkyS

t

1953

average.

This

can

by

en¬

(1)

re¬

tained

ownership

theaters, (2) stock control of Dumont Radio, (3) 50% interest in
motion picture production suggest
that reaching for yield here should
not

too

prove

mount

In

hazardous.

nominate

we

$300 per

oils

looked

$260 per

for from

at

the

billion

year

100

may

shares of

Here's

$3,250.

gressive enterprise

a

pro¬

moved up

now

dollar

class

good management and
sive

Para¬

provide

annum.

the

into

to

an

with

aggres¬

petroleum

exploration pro¬
gram, broad pipe line and marr
keting
facilities.
The
current
yield is attractive and a larger

b

done

e

expanding

research, in¬
creasing ad¬

Canadian

of

least

e

spread of Paramount

tertainment field through

busi¬

at

a

m

position here is excellent and the
the

Predictions

in

the

first

(2)

half

The

world

no

of

war

1954.

Dow-Jones

industrial

30, 1954, than on Jan. 1, 1954. •»
;
(3) Taxes will be lowered by
expiring laws.

up

duringthe
first
half, to
its
approxi-

The cash

over

Babson's

(1) There will be

stock average will be less

ness,

■;

'

Moving along, $4,000 might well
be deployed into 150 Paramount.
The present $2 has been earned
a

Mr.

in

appear

hold

enhancement.

for

six
months
will
this paper next June.

unite forces to

'&&&■

>/<■

incap¬

or

ond

will

everyone

And

year.

means

the

in 1954,
in
net

decline

three-quarter

stock

in

economists—that

Spelvin
might buy 100 shares of SP sched¬

Sinclair

power

361/4.

yourself

We believe George

acres.

be

robbed

Though holding "everyone will unite forces to hold up business,
at least during first half of
1954/' Mr. Babson contends if busi¬
ness should
slump 10%, the decline would not stop there, but

Book

controls 50

or

of land,

acres

tion

indeed

of

railroads

to

owns

disheartening to be ignored. Infla¬
has

is $3.

panies including several bus com¬
panies, the Pacific Motor Truck¬
ing Co., ownership of four million

past decade are too numerous and

all of 47% of each dollar's

By ROGER VV. BABSON

an

over

Telemeter, and (4) well managed

Inflation

The

averaging

tie

to

completely
that SP

uled to

to that idea

no

it's had

earner

price

like

the

we

ception
is

to say

an

record

value is about $120 a share against

next

general proposition, al¬
may consider an ex¬
little later on. If a trade
now
and its uptrend is

a

though

Forecast for First Half of 1954

Portland,

share for the past 12 years.

per

been

the

that

movies?

textiles,

we've

month, his

a

year—that's

a

fortably
a

dividends

where

indus¬

earnings phase might be up? Like

dividends from paid up insurance

the

distressed

about

security for Mr. Spelvin

amount

month.

either be dead by
too old to enjoy his new

or

found

(now

of Mr.

He'll

George.

As

to

The current dividend

don't

Mr.

Coast

enviable

respectable list of equities selected
today's market.
v#*

a

on

from

from

arc

through Texas, Ari¬
New Mexico, north through

zona,

"Winning in Wall Street"

paceful piece

vast

a

New Orleans

By IRA U. COBLEIGH
Author of

in

Chronicle... Thursday, December 31, 1953

vertising

(4) The price of most commodi¬
ties

will

be

lower

June

on

30,

1954.

,

(5)

-

The

moon"

Eisenhower

is fast

have

"Honey¬

ending and he will

hard

a

Congress

time

during

controlling

the

next

six

months.

(6) Retail sales

ap¬

propriations,

Roger W. Babsoa

June

on

be kept up

can

by manufacturers and merchants

extending fur¬

spending more money on advertis¬
ther credits, and obtaining labor's
ing, selling, and developing new
co-operation.
products.
I
say
something much
important than the above;
namely, if business should slump

(7)

But,

more

10%, the decline would probably
not stop at 10%. Too many busi¬
and individuals

concerns

ness

working
slim

are

best

S.

(8)

average

about

cept

the

which

10%

a

would

rates

months

and

decline

could

cause,

and

sales

in

during

of

at

as

1954

the

present,

renewal

of

should
ex¬

low-rate

loans.

(9)

in

result

on

for

"teen-agers."

Interest
six

em¬

very

growth

prospects

1954 will be the

first

population will

present

narrow

a

ployment, with resulting business
gross

the

U.

its

The decline in

on

margin.

losses

The

continue

Farm

lands,

except

near

cities, will sell for less during the
first

half

of

in millions of families being un¬
1954, when farmers'
defense, however sketchyr is not
able to pay their bills and instal¬ profits will begin to decline.
in bonds or annuities, so dividend in the fullness of time
ment obligations.
(10) The Central and Southwest
This could set
ordained. And to you, my confreres
we have to try for it in
equities. does not seem too wild a hope.
off a chain reaction, which could will not suffer drought as in 1953.
in finance, that poses a nice set of
And let's face it, our task may not
send business down 10% to 30%
(11) There will be more fear of
Pullman, Inc. seems
to
have
questions. Can George get 8% on look so
unworthy when we con¬ been
World War III as years go on.
rather neglected
his dough without losing his shirt
by yield more, with a corresponding desider the plight of today's pen¬
dine in the stock market, com¬ People will gradually move out of
buyers, although it has a glorious
doing it? Can he be reasonably
sioner, under standard employ¬
dividend record and has diversi¬ modity prices, and real estate. In certain large cities. Nearby farm
assured
that
his
selections, to ment of pension funds.
land will be split
fied
from
up.
A rise in
total this 8% income now, won't
strictly railway car this latter case, the Eisenhower
the price of such fringe farm land
So, granting that we're taking a building to trailers in
be
bogged down by dividend
Trailmobile, Administration would suffer as
jc pprfflin
more risky approach to retirement
did the Hoover Administration.
Inc., and construction in M. W.
lapses, cyclical swings, or a sharp
income
than
would
be
counte¬
(12) The U. S. Government will
deflation? These are the inquiries
Kellogg, both owned subsidiaries.
In view of this possible serious
nanced by a bank trustee, we ad¬ The
we'll dabble with today. And re¬
$3
dividend
appears
well alternative, I have contacted the give less money to the European
mit we at least know what we
and other nations direct; but will
buttressed by sustained earnings
member the basic search for high
leading newspaper publishers as
are
trying to do. We intend to power and strong cash position. to the attitude of their
help them through the United
return is by no means academic in
respective

Spelvin family (the children are
grown up and married) have

all

society.

our

The

desire

suffer too great a

ing

standards

has

set

out

of

select

not

retirement

concept

straight
(Theory of the

a

Veblen

Leisure Class); and the sustained

impact of the inflation of the last
score

of years makes a

more

tens and tens of thousands. Should

vanced age,

when losses

ad¬

an

can .never

be made up?

Should they hazard
becoming dependents of relatives
or

friends,

semi-public charges
hopes for more

or

if their ideas and

exalted

income

explore

Certain

If

of

a

it

is

that

a

Let's

man

should not make

summers

out

backfire?

bit.

a

called

so

now

IBM

or

is

fetish

10

or

Electric

indicated

their

lovely

in

crowd

this

investment

tradition,

out

for

boldly

client,

George

mittedly
into

the

York

or

Our

goal

$2,000

a

to

is

8%

course

or
we

arrive at it with suitable

the

to

age-old

diversification.
is

of

and

year;

$25,000

on

a

If

concept

diversifica¬

desideratum

generally,
it is doubly requisite in the high
yield program we've undertaken.

We

propose
among
and

deployment

a

seven

separate

enterprises.

of
in¬

This is,

Exchange

of course, no warranty for success

Exchange

but

New

Cotton

Exchange

Chicago
New

Exchange,
Board

Orleans
And

of

Cotton

other

Inc.

should

insulate

somewhat

against total failure to obtain

our

objective.

40,

is

annum

ple

extra this year

an

around

this

The

Exchange

So

$9.

and should

earn

Some analysts regard

the most

favorably placed,
marketwise, of the steels and the
possibility of cash extras in good
as

has rather caught Mr. Spel-

years

vin's

One hundred shares of

eye.

Youngstown

the shopping

are „on

list.

for

pass

Inspiration

with

years

bit
don't

dividend.

$3

a

this

ago

producer.

was

at

over

cost
70%

efficient open-pit producer and

definitely

cent

seem

present

copper.

likely

very

should sell below 27 cents

the

shareholder

in line for

out.

It

that

1954; and should inflation

turn

be

its

earn

25

on

not

copper

for

here

higher cash

a

Inspiration

is

a

re¬

might

dangerous

level.
and

at

one

its

present

Let's try 100 shares for size

a

hope for $300.

Consolidated

One

guished
has

Edison

the

of

utilities

displayed

a

in

to

return

most

the

distin¬

world

it

Seven

Exchange Bldg.

NEW YORK 4, N. Y.

where

shall

we

start?

Per¬

Southern

DETROIT

GENEVA,

PITTSBURGH

SWITZERLAND




position,

Pacific would

Due
I

U.

S.

and

in

waiting

are

1954 develops.

the^chances

believe

will

be

Below

1954.

at

8%.

definite

the

to

forecasts
prove

months

six

My forecast for the

sec-

issues

appear

market

price

The
their

worth

three of

least

to

be

today,

at

higher dividends than we've

listed

in

Considerable

1954.

in¬

flation defense has been provided.
While

this

tradition,

column

is

audience

an

tion one, some
would

views
be

on

not,

by

participa¬
the ideas

welcomed;

and

other lists beamed in on the same

target would be most interesting.
Of

course,

this is

tough task; it

a

is either absurd to attempt an in¬

eight,

or

a

challenge to in¬
Which do you

vestment adroitness.
think?
well

Mr.

Will

Spelvin

sleep

With yours?

with this list?

100

Expected

No.

Annual

of

Price

Company

Cost

Income

be

my

ing

here, by deliberately draw¬

a

seized

bead

on

upon

The

dividends,

seven

Spelvin's
about

we

issues

to

have
im¬

hopes.

$25,000,

36 Me

$3,650

$300

Paramount

26 Me

3,975

300

100

Sinclair

—

32

3,200

260

100

Pullman

—

40

4,000

300

100

Youngstown

38

3,800

300

So.

Pacific.

100

Ins.

Copper

100

Con.

Edison

41

ex¬

£>rop- cluding commissions, and arrived

at

the

to

The

will

profits

close

Administra¬

much

to

opposition

reduce

decline

tariffs

if

unemployment

or

increases.

(15)

The

labor

Administration

leaders

will

and

to

try

re¬

the Taft-Hartley Bill dur¬
ing 1954; but bad strikes are com¬
ing.
(16) I am no weather prophet,
vamp

but

experts

winter

for

expect

the

the U. S. and

(17)

a

warmer

eastern

a

portion of

colder Florida.

Canada

continue

will

to

boom during the first half of
1954,
but this may be a good time to
take

profits

Canadian

on

invest¬

ments.

(18)

ply
its

The

above may also ap¬
Southern*- California and

to

airplane and movie industries.

Both

have

may

reached

their

peaks for the present.

(19) Automobiles will be harder
to

sell

easier

and

first

the

half

automobile

of

to

buy

1954.

stocks

during

Both

and

the

the
cars

will be in less demand. There will
be

more

discounts
cars

of

bargains
on

the

(20)

new

in

used

cars,

cars,

especially

"independent"

Florida

manu¬

(21)

killing

The Korean situation will

remain about

240

shootie."

$2,000

have

Arizona, and Texas.

300

12/28/53)

may

frosts during the next few months.
This
will
cheer
up
California,

4,150

Me

present

suffer

attempts

man

$24,875
(Prices

(14)
tion

2,100

21

take-home-

facturers.

List

8% Income

total

thing for the morale of the nation.

them might

and
pay

June—the

will be less—than last June.
This, however, may be a good

pay

the

should

first

(13) There will fewer employed
next

half of

good.

case,

any

for

correct

25

are

which, in
of

fairly

ten

are

the first

that at least

Nations.

a

the results of this survey,

to

one

list.

transportation enterprise em¬
plement Mr.
bracing 21,000 miles of track and
serving the most rapidly growing We've spent
the

but

until they see how

Shs.

So

nomination in this department. A

sections in

content

now

150

vast

CHICAGO

are

strong

quality is
on
a
most attractive yield basis.
It rounds out, and classes up the

Candidates

optimistic

are

favorable earnings

haps among the rails.
N. Y. Cotton

643

come

Finally, we'll add 100 shares of
$240.

dis¬

and want- to buy and invest more;

offered
pay¬

speculation

of course, but it does not look like
a

communities

297

peo¬

liquidate;

to

want

970

over

Five

high

a

it's

Today

can

Copper

and

couraged

a

shopper for .yield

a

over

$21

reaching
entry but I

next

my

how

see

we're

,Of these,

replied as follows: The
of 30 communities are

1954

Perhaps

an

communities.
have

trend and in relation to

Trade

Exchanges

at

per

Spelvin.

dividend

$2,000

Stock

Commodity

$300

Youngstown at 38 paid $3 plus

can

American

York

Pullman

return

to

Mr.

to

weighing

bold and daring foray

a

dustries

Stock

hundred

does

funds
New

Spelvin,

and

equity market.

8%

tion

Members

friend

our

qualities. We shall strive
for
yield, and shall hope that
safety of principal and return do
not
get hopelessly lost, in ad¬

of

H. Hentz & Co.

One

slated

clusive

deference
1856

strike

we

suitably the axiom that yield and
safety tend to be mutually ex¬

want

Established

discussion, and the

hewers to the line of conservative

may

but not for

—

yields.

Thus, having duly lost the bond

years

it

some

admittedly highly selec¬
tive,
some
discerning
security
judgment may effectively screen
shares primarily on the basis of

going to be another

General

all be very

65

"growth" stocks.

eight

company

from

a

of

with

market

con¬

servative, orthodox bond yield of
3%-% to 4%, quite inadequate for
these take greater risks at

securities

vestiges of investment status; and
we
operate in the belief that, in
a

in, is

from

to

slippage in liv¬

once

afforded

(22)

says,
,

is—as the China¬

as

"much
1

talkie,

:

There will be

no
,

one

or

two

resignations from the Eisenhower

Volume 178

Number 5286... The Commercial and Financial
Chronicle

"businessmen's Cabinet," replaced
by "politicians." All is not
going

too well. The President is not
used
to being pressured

(r

(23)

The

should
out

be

of

first

debt.

your

bankers

best

your

debt

half

Remember
in

are

the

shining,

when

it

cannot

and

rains."

blame

rainy

can

clean up

the

want them

days!

Operate so you
bank loans once dur¬

prosper
most
are
those
which
have inaugurated effective labor-

not

Most manufac¬

are

learning that they can¬
labor through
mere
They are winning only as

beat

strikes.

they

slight dip in over-all industrial production for the nationat-large occurred in the period which ended on
Wednesday of
last week.
Compared with the like week a year ago, output

moderately lower.
Additional

more

(24) The companies which will

purchase

research

rlabor-saving /

new

machinery, spend
and

more

well-directed

on

layoffs
than

numerous

announced

were

the

at

time

same

and

in

strikes

remained

the

previous year.
As
workers, additional firms were
forced to curtail their operations or shut their
plants because of
result

a

the

of the

strike

of cannery

noted.
WASHINGTON, D. C., Dec. 30— widely recognized as the academic
p i o n e e r i n
Worrying the four thousand of
what - to - do the economic elite attending the
about-it plan¬
annual sessions of the Allied
Science Assoning, -pointed
>

It

cans.

further reported that packers

was

layoffs last week.
•
•
Republic Steel is recalling 4,000 to 5,000 employees at its
Cleveland plant several days earlier than it had
planned/M. E.
Goetz, manager of the Cleveland district plant,. disclosed. But

not the extent

Eisenhower

Tuesday

on

mounted.

this

of

ther

be

may

inflation

some

emergency board to head off a threatened strike of
million railroad workers represented
by 15

in

1954; but per¬
the total national

centagewise to
output it should

not

Creation of the three-man board

fur¬

help

the
a

Railway Labor Act the
60-day period.

stock market.

early

1954,

continued
What Will

I

have

Eisenhower Do?

promised to

the

answer

thirds
and

of

Assistant

President

Adams, representing certain Re¬
publican leaders, and turn to
the left?

Or, will he stick to hi^

.conservative election platform?

ANSWER:

He

will

stick

to

his

created

of

It

reform

adjustment

economic

and

promised

as

by

President

Eisenhower, or will
he give the country more infla¬
tion, and further play Santa

and

and other groups?

"economic

that

learning

reforms"

must

be

gradual.

in

1932?

for

1956

principle,

matter

a

did

as

of

in

Hoover

will he succumb to
the temptation of changing his
attempt to "save

an

losing

Is

1954,

"middle-of-the-road"
Will it serve
groups, or no group?
is

it

Yes,

practical

for working a gradual change, and
it should

part

of

activity

about

and

December.

The

both groups.

serve

Na¬

output

and

orders

will

level

off

bit in the first half of next year.

a

that

week

lower

had previously followed Lees'

prices

carpet

example, it

the

at

two

was

concerns

further

re¬

ported.
In

the furniture

declined

14%

from

industry manufacturers' orders in November
a

year

for the

industry reports.
slipping since last July,

Seidman & Seidman, accountants

ago,

But incoming business, which has been
was

only 2% below October.

This

com¬

an average drop of 13% between the two months over
10-year period, it states.
Steel production is gaining faster behind the Iron Curtain

a

But

national metalworking weekly.

Combined

But comparison on
Free

holders of its
8%

of

Russia

and

its

World

nations

tonnage basis shows

a

produced

54 million

over

the Free

sinking fund gold

bonds, series A, due July 1, 1948;

14%

was

million

200

over

different picture.

a

net

tons

of

In

tons.

This is almost

1952

World

Free

countries

bloc turned

out

a

produced
total

1

advantage for

sinking fund gold

ries

C, due July 1,

bonds,

se¬

1957; and the

in

1952.

Total

Well
counted

world

half

over

for

This

of

outpiit in 1953

Free

by the United

was

World

States

in

254.6

production

which

million

net

made

in

1953

111.9

was

ac¬

million

net

54-day strike which closed down most of the industry.
in

1953

to

were

74.3%

capacity.

A

operations this week

from

thea Christmas

seasonal,

year-end

end

other troubles,

this

scheduled

low

continues

of

to

to

64.1%

advance
of

prevail

rated

in

the

people aren't alarmed, states "The Iron Age." Yearoperations is traditional in the industry—except
of war or emergency.
With customer pressure re¬

in

during time

duced, companies

are

reducing output by banking furnaces instead

paying costly overtime to keep production up.
Operations are expected to gain gradually in January, it
observes, and to continue to improve in February and March. The

3and

for the next year.

fund
1976

bonds

dollar

that

time

the

sinking
Jan.

due

within

which

the offer may be accepted to ex¬

change

the

and to pay

bonds

and

coupons,

Certificates of Deferred

Interest (scrip certificates) in cash
at

been
to

of their face amount, has

15%

extended

Jan.

from

Jan.

1,

1954

1,

1955.
of

cates

for

Fund

The

period

Convertible

Dollar

3%

External
Bonds

of

for

Certifi¬

Re¬

to

extended

July

1,

from

July 1, 1955

1956.-




probably be tops for the quarter—and perhaps
New

Year's

holiday and continued

closedowns

about six producers will cause auto output this week

G.

A.

from

the

short

"optimism

Hart,
the

Conference

Board

Martin

Gainsbrugh,

typically epitomizes the
that

little

fact,
is

illness

our

and

consensus

will

non-virulent

now leans on abatement
of taxes, without the usual delays

planners,
in

in

order

doom
are

that the

from

the
con¬

tiny minority of

prophesying

-

a

In

worry

unanimity in the forecasters'
fidence

Clarks

Colin

wrong.

Resuscitation

reduction

sumer

What,

recession

nomic leaders

When

and

the

is

eco¬

largely centered

antidotes.

For

example,

consider¬

ing the effects of diminished def

expenditures,

e n s e

Professor

George H. Hildebrand of the Uni¬

versity

of

market

California recom¬
invocation

the

measures

of

open

if and when

within

six

months.

should

If

victims

those

for

another

Professor

action

on

the fiscal side—the

latter to include
of

in

revision

rates

compensation,

unemployment

additional reductions at the lower

tax,

business

cludes

income.

defensible

to

projects,

he

is

of

public

talk"

eral

rendered

the

by

such

a

somewhat

divergence

On the question of
capital expenditures he

revealed discrepancies between
of intention and sub¬

to

statements

the

actually
for

need

public

to

businessmen

"If

adapted

to

a

we

life

economic

in

will stack

total

in

000

this

the

up

qualms, Professor
Hart typically represents the
such

Despite

among
the
academic
economists.
Furthermore,
from

thinking
the

is

volume

least

at

of

quent alleged

here

discussion

clear

that

final

planning and interven¬
be charged to absen¬

cannot

teeism

from

the

problem

professional economists!
From the expressions

by the

"the
Philosophers," whose
"cream" is gathered here, inun¬
dating platform and hotel lobby,
by

Worldly

Albert

G.

Continued

Hart,

on

page

Canadian Securtiies
BONDS
GOVERNMENT,
PROVINCIAL,
MUNICIPAL
CORPORATION—EXTERNAL and INTERNAL

quarter production

at about 1,286,000, which is behind the

1,315,second only to the
record. This will make it thq first quarter
states, that car production hasn't been

quarter

quarter of 1950, a
year,
this agency

last

year

and

STOCKS

was

Order*

Executed

on

Canadian Exchanges

at

regular commission rates

ahead of like 1952 quarters.
But for the year
cars,

or

about 42%

to date the industry has_ turned out 6,068,415
than the 4,278,363 in the corresponding

more

1952

period. There are at least four more production days
1953. The industry's record remains 6,700,0Q0 autos in 1950.

for

Burns Bros. & Denton, inc.
Tel: DIgby 4-3870
'Wires

Continued

on

page

30

it

subse¬
negligence in gov¬
any

to

'

final

the

Twentieth Century," he said.

forcibly with the growing of the

Planning Pioneer

Professor

Car

in the like 1953 week, it adds.
It now appears that the industry's

and

the psychological
can't, we are not

keep

balance.

carried-through

Also he emphasized

the annual observer is struck most
From

low, "Ward's Automotive Reports" notes.
production the current week should be about the same
or
lower, than the 68,795 assembled last week.
This was 29%
below the 97,416 in the previous week and 13% behind the 79,237
-

of

likewise expressed skepticism due

ernment

will turn the tide.

of

effec¬

its

program.

business,

tion

public works

that

needs from the overall Fed¬

in¬

confident

is

tiveness

shelf

a

years

strongly urged by Hart,

cautioned

uncertain
local

"after

works

was

he

but

Effectiveness

Works

definite creation of

he

broad

mortgage

Tax

also

re¬

with

Along

the

"Gadgets" were
recommended,
but
with
warning
of
an
accompanying
booby-trap in case of bad timing.

payments.

the

taxes,

step,-

recommended

down of amortization of

on

Among

income.

lightening of pressure on debtcreation, including the slowing

taxes

liberal write-offs for

more

program

in

business

on

depreciation.
resort

individual income

revisions

and

layoff, who

of

resuscitating

Hart

sequent

one

the

bereft

performance.

quarter, he would urge discretion¬
ary

of

entirely

are

un¬

unemploy¬

7%

exceed

•

realiza¬

cautioned

Hart

5%

reach

should

employment

con¬

i".

other side of the medal,

Public

the

by

at this morning's session

on

Security

tion that such relief does not help

The

the

thereon;

Social

in

economy.

Professor

How Effective?

So

action

Congressional

and

As

for cynical

some cause

probably

be

one.

Dr.

now.

who has previously gained
close
ear
of
the
practical

On the

here

sev¬

months

eral

Hart

remain

Sinking
the

public, due Jan. 1, 1976, has also
been

among

final

exchange

extended

An

1,

will

Prof.

keynoted by National payments—all to bolster the

as

Economist

visions

decline

The

brackets of the

are

week

lag

or

Opera¬

market.

But steel

will stop

a

latter month

external

depression.

ment

1952.

gain of 18.7 million tons, or 20.1%, over 1952
production of 93.2 million tons. Output in 1952 was restricted by
was

appurtenant coupons for the 4%,
3%

of

that

agreement

recession

in

are

t i cally

tons.

11% greater in 1953

of

7%

unanimous

mended

million

was

tons, compared with 229.4 million net tons

tons.

to

a

182 million net tons,

of 48

Steel production in the entire world

than

4

a

p r a c

raw

was

World, states the above trade journal.

Steelmaking

Customs

satellites

steel in 1953, while total production of the Communist bloc

Republic of El Salvador is

Lien

production

greater in 1953 than in 1952, while output in Free World countries
was only
10% higher in 1953 than the previous year.

ognizable

and

experts

here

May
.

tonnage output

of the Free World is still nearly four times as
great as total pro¬
duction behind the Iron Curtain. These are
highlights of a study
of world steel production just completed
by "The Iron

9%

notifying

Wilfred

pared with

unhampered by labor
trade authority points out.

Exchange Offer Notice

A.

assumed

This company's action came three months after James Lees & Sons
Co. cut carpet prices an average of about 6%.
Artloom Carpet
Co. and Philadelphia Carpet Co. were the

tions

El Salvador Bond

the

(as

becomes
definitely rec¬

icurist,

man

orders

Industrial

a

First

estimate

this

reported

while the Red

a

ANSWER:

The

latter

optimism

more

industrial

re¬

tion)

As with taxi

caution"

and

again in 1956.

practical?

policy
both

run

the risk

run

in

Congress

the chance to

(4)

the

climb

be

ameliorate it.

striking for

are now almost a
certainty for 1954.
An an¬
by Bigelow-Sanford Carpet Co., the industry's larg¬
est firm, stated that it is
making "selective" price reductions,
ranging from Wz% to 7%, on its 1954 line of floor-coverings.

little

party"?

ANSWER: He will
of

of

nouncement

Or,

policy with
his

terms

Age,"

(3) Will he run the risk of losing
Congress in 1954 and the elec¬
tion

displaying

that

than it is in the countries of the Free World.

is

He

under

barred from

are

should
will

invoked to

Purchasing Agents reported that about two-

members
even

that

means

perhaps from
a
shaky
in¬
ventory situa¬

driver
are

fact

in

e

cession

which

a

manufacturers' level

Claus to labor, farm, high tariff

ANSWER:

decline

its

was

which

(2) To put the question in a more
practical way: Will 1954 be a
of

the

t h

o re

but rather the

an

than

more

only

election platform.

year

to

perhaps

(1) Is Eisenhower to take the ad¬
vice

despite

tional Association of

following four questions:

15 unions

Purchasing executives

the

f

e

kind of

...

week

non-operating unions.

There

diffi¬

:

ing recession,';

•

(25)

b

"the" cbm-

of

the

culty of adopting policies

is

measures

elsewhere, layoffs and production cutbacks
President

here

ings

meat announced

can

to

ciations' meet¬

•

shortage of metal

who

money on

advertising.

Philosophers' ever-growing political consciousness

A

was

WILFRED MAY

Full-dress Washington parley ponders how much
Recession and what can be done about it. The

J

you

because

ing 1954.

turers

By A.

Index

Production

Business Failures

in

belong to the de¬

saving programs.

Price

Auto

Industry

sun

them

Moreover,

positors, who also will

Food

and

of

Trade

Commodity Price Index

most

when the

them

umbrellas really
on

reduce

that

calling

Carloadings
Retail

State of Trade

get

business

Anti-Depression Battle
Mapped by Economists

Production

Electric Output

1954
to

least

"loaning umbrellas
is

of

time

at

or

Steel

The

by lobbies.

5

(2629)

to:

37 Wall Street, New

Toronto

•

Montreu.

York 5-:
TWX: NY 1-1467
OtT.vwv * Winnipeg

•

37

6

The Commercial and Financial Chronicle..
.Thursday, December 31, 1953

(2630)

\
I

The Farm Situation Calls

that

believe

the^ turning
direction.

j

Secretary of Agriculture

t

Secretary Benson, in picturing farm situation today, gives data

i

I

on

I

of the farm

t

progress

ance

fibre

held by the government. Says, though solution
problem may still be in the future, considerable

has been made toward

In only two cases—cottonseed ana
flaxseed—have the support levels
been lowered.
And it was gen¬

and expresses view,
Holds high crop sup¬

recovery,

point."

erally recognized that the adjust¬
ments

ports are no cure for unstable farm income, and points to fail¬
ure of Democratic party farm program.
Reveals new Adminis¬
tration is

working

plan "to help insure the farmer

on

wide

reason

or

able

to

And in my

farmer

be,a

myself.

present role I am still

dealing with

problems I had

as a

in

was inadequate and
piling up on the ground.
At the same time, farmers were
urged
to
use
the price-support
loans as an aid to orderly market¬

Farm

$1.1 billion.
least
be

(3)

cotton,

can

wear

or

Farm
has

moved
promptly
comprehensive pro¬

with the most

such facilities.

gram

developed

ever

bushel of this—1 storage in order to
is that we will price-support loans.

prospect

Old

increase

to

in

or

stocks

our

and

cereal

to

Americans for

a

the

meet

needs

160

of

bread

million

full year.

qualify

Dairy

dropped

Ezra

February,
new

Benson

Taft

1951.

113%

were

By the time the

under

Farm

of

products:

We

more

own

than 900 million pounds of butter,

cheese and dried milk, acquired at
a

parity.

cost of $333 million.

The

Administra¬

list

entire

of

Agriculture

in

to finance

government-

May

to

farmers

Democrats

tional

—

only four

points since the President invited
me

What

about

fact

that

Do

rising farm costs—
must

you

pay

$2 V2

billion

by

the

end

this month.

purchase of additional bins

or

and cribs.

A

special "use guaran¬
followed to encour¬

tee" program

Nmt

building of new commercial
storage. All this was backed by
new
legislative provisions under

man

that

more,

most

which farmers and warehousemen

of

<v

;

of

of

that

excessive

-

more

for all
of

guarantee provisions
alone,
than 230 million bushels of

government just to pay the storage
for

these

crops?

Four

decline

hun¬

capacity

Farmers

*Address

"toe

Annual

by

Secretary

Convention

Bureau

of

Federation,

Benson
the

You

I:

as

Corn: 764 million bushels.
.

it?

have

vi*ere

been

offered

During the first
the
Has Done

Before I
you

of

some

the

I will

things

we

tell

have

already done.

Loans
before

American

Chicago,

Dec.

16, 1953.

Let

me

"Section

funds

that

answer

year,

of

What the Administration

ceipts—were

has

oeen

made

months

funds

marked for similar

be

interested
million
used

to

of

to

will sell at his office at

Albany, New York

of

243

help

million

funds

pounds

stabilize

the

at 12 o'clock Noon

where in

Help

this

off the market.

This

which

the

1953.

hit

HOUSING (SERIAL) BONDS

To

market

for

Dated

wheat

January 15, 1954, and maturing

$1,245,000—annually January
Redeemable by State
any

million

as

follows:

outright gift.

15, 1956 to 2004, inclusive.

-

example of
ties

on

notice,

on

January 15, 1994,

or on

interest payment date thereafter.

Descriptive circular will be mailed

upon

application to

J. RAYMOND McGOVERN, State Comptroller, Albany 1, N. Y.




Lord

our

us

and

Master,

Christianize

to

minds to

the

level of the

our

Souls

spiritual and ethical

day, most holy Father, when

wars

will

when international hatreds and discords will

be

more

no

in

this

war-cursed

world

and

mankind, both nations and individuals, to
ance

of

Jesus

Christ's

admonition:

an

help all
observ¬

"Love

one

famine

the

in

of

surplus

our

government

This

was

a

America's

leadership

as

an

.

May

our

foreign brothers in

arms, soon

be

able to say

dramatic

"I

opportuni¬

in

Americans and Russians, friends and foes

we,

alike, and all

the

free

dream

No

other

a

world

man

where

Man

will scorn,

world.

food

industry,

hav^

increased

sumption

high

1953

for

battles

cease,

areas

In cooperation with the nation's

Principal and semi-annual interest July 15 and January 15
payable at Bank of the Manhattan Company, New York City.

Dated: December 28,

actual

that

our

another."

bushels
to

and

Supreme Sacrifice in Korea and else¬

especially af¬

Administration made available 37

STATE OF NEW YORK

Families

our

foreign lands.

Hasten the

surpluses.

avert

a

beef

friendly nation of Pakistan, this

of the

gift,

values of the Man of Nazareth.

more

by drought.
our

more

one

Humanities, and, with Thy help, uplift

and

We have sought broader outlets

for

Country, for

our

pro¬

of

fected grass-run cattle from

$61,005,000

us

Christianity, to Civilize Civilization and to Humanize

men who were
caught in
price-squeeze. Thus, more than
850,000 head of cattle were taken

.

us

humbly give thanks for Thy blessings and

and made the

livestock

(Eastern Standard Time)

of

all, Thou hast given gen¬

us

Young Men of America who have fought

a

January 6, 1954,

all

on

loved Ones, for our Friends and for the courageous

help farmers during

gram we have contracted for

/

We also

re¬

that

Through the beef purchase

to

Father of

privileges, for

prices

each of the five years before

than

household in

this

grateful heart.

average of about

such

on

trustfulness and

You might

use.

know

an

and

erously of Thy bounty; grant

special

—

love

gathered at this table to partake of Thy

are

Gracious

through direct purchase. Another
$100 of these funds have been ear¬

were

The Comptroller of the State of New York

blessings and for the blessed life and birth

bounty.

million

used to bolster

$60

progress

ten

32"

compares with

along the road to recovery.

our

this New

we on

with thankfulness to Thee

pray

Thy Son, Jesus Christ.

who

op-

available from customs

erable

you

Day humbly

affectionate

ap¬

the

than $1C-j

more

that though
the solution of the farm
problem
may still be in the future, consid¬
assure

IJrar's 1954

May Thy benediction rest

.

proved.

bill

you

yopr

stocks.

know the story as well

Farm

1766,

space^available. Under the

use

storage

crushing cost-price squeeze.
Let's take a quick look at the

matter

built

prayer JFor

just God and merciful Father,

jr

Year's

gasolirie,

occurred during 1952.
This puts
agriculture right in the middle of
a

Broadway,

worshipped.

By ALEXANDER WILSON

dred sixty-five thousand dollars a of
wheat, corn, and pats. This enday. "And the bill i£ going up fast! portunity to reseal 1952 loan
stocks
feed, and machinery cost more?
These overall problems of fall¬ a
bled them to earn a storage fee
The index of prices paid
by ing income, over-abundant
sup¬ for holding grain on the farm a
farmers for goods and
services
plies, pinching costs and loss of second year.
has dropped
only 13 points from world markets, are ones this Ad¬
the record high reached in
/'The Commodity Credit Corpora¬
May, ministration inherited. They were tion
bought added storage bins
1952. Prices received
by farmers, on the back doorstep when we
with
a
capacity of 96
million
however, have dropped 64 index moved in the front door.
bushels, so it could take prompt
points from their Korean War
What are we going to do about delivery of loan stocks.
peaks. And

hired

lower

on

Washington

age

know what it costs the

to ioin his team.

the

Parish,

George

A
Jlamtly

the build¬

over,

the

Trinity

Gen.

for

held surpluses is a long one.
It
farm parity had
can amortize the
cost, for income
dropped to 94. Today the parity currently adds up to more than tay Purposes, over a
five-year
ratio is 90, although it has aver¬ $2'/2 billion—twice what it was a
period.
year ago. It is probable that gov¬
aged about 93 during the yeay
.These
incentives
have
made
ernment
loans
on
various
farm
past.
millions of bushels of additional
commodities
will total an addi¬
So farm prices dropped 19
points
storage

took

Chapel.

where

!

who needed

ing

income

from the peak
it hit in

tion

St&Paul's

Farmers must have V

—we

it

feed.

prices then

Administration

wheat will

more

single

a

the

It is expected that at

Low-interest loans were made
actually wind up with most of it
already have enough wheat available by the Department of

and

eat

Avoiding market gluts at har¬

vest time.

under loan from the
But even if we don't

crop.

and

wheat,

than

corn

ing.

have 425 million

now

much

placed

acquire

more

butter

that

1953

govern¬

ment has

build-up

corn.

Abundant crops this year made
modity Credit Corporation, ac¬ it clear that more storage space
would be needed for grain.
quired at a cost of approximately
The

ex¬

up;

on millions
1953
crop.

further

a

government-owned
Wheat: We

have

penses

gone

The

the

from

points to

was

bushels in the hands of the Com¬

dropped;

(2)

bushels

Here

face today: (1)
Farm income
has

of

This

briefly is the
situation we

being made

now

same

of the
farmer.

many

are

where—

area

another—avail¬

storage

wheat
used

made available to

were

over a

for

one

necessary.

wheat, special dis¬

farmers

share of the national income."
I

of

case

tress loans

and

sound

were

In the

fair

a

programs.

High price supports on food and
crops have been continued.

drop of farm income; rising farm expenses; and the bulging

1953 "has marked the turning

De¬

your

This also is true of related assist¬

farm surpluses

r-

v

year

partment of Agriculture has given
farmers a better opportunity to
take full advantage of price-sup¬
port programs than ever before.

By HON. EZRA TAFT BENSON*

r

right

the

*"

r

During the past

Fox Revised Action

has marked

1953

point—in

v

of

of

75

special

the

beef

Similar campaigns
for

other

to

pounds

farm

campaigns

annual

per

person.

under way

products.

Continued,

on

Where love will bless the Earth,
And

Grant this

all-time

an

are

con¬

|

These

page

24

will, in the

Peace its

prayer

name

we

Path adorn."

beseech. Thee, if it be Thy

of the Prince of Peace. Amen.

Volume 1 v8

Number 5286

The Commercial and Financial Chronicle

...

-

(2631)

\

&

V

a
m
ft

i

ft

ft

.

%

ft

k

m

W. *•'
MS

==H=

i

US]
lain

r

I'-

SEVEN

GREAT

COMPLETE

-

STEEL-MA

..

,

T*<

GRtAT

steel

lakes

Detroit, Mich. A
of standard an -

P

^eelndU?nns
of

corp;

of,tin

industry,

-m

applications in

strah-stkl

rt0VvI!vvS^

e

other

Using waterways

division

Mch.andTerreHaute

££&

plate.
'ititi**
products^
important steej V- -

naUable fram.ng.

HANNA

•r0n
ings

fn
m

IRON ORE

the

tne

Great

company

better steel

to

fURNACE CORP.
New York. Blast fur>ew

u.mnA

"

Along the banks of the Ohio—"La Belle
Riviere" to the French explorer LaSalle—
not far below
Pittsburgh lie the river docks
of Weirton Steel Company, a major divi¬

Buffalo,

division for
of various types

nace

—•grs*
for
Houston,

production

J

ot PS

iron.

steel

facilities

prodockin the Southwest.

finished steel. National Steel's
delivered
span

Working 24 hours
clam shell

cranes

a

on

day,

great magnet

scrap

...

mines CORP.

and

LI'

tl^ N^nal Steel »«*

the

NATIONAL

as a

great

inland

AN

INDEPENDENT

COMPANY

OWNED

past

3,500,000

the

tons

Weirton

of

materials

river

docks

in

year,

water
transportation is
why National Steel has
become recognized as an efficient producer
of high-quality steel products
\
a leader
in steel-making progress.

another

serve

BUILDING

over

Use of economical
reason

.

NATIONAL STEEL
GRANT

than

National Steel's expanding steel production.

highway for the transportation of

STEEL




waterways

to

and the capacity of these
handling facilities has been markedly in¬
creased by recent additions to keep pace with

hoisting

barge a cargo that fills from 15 to
gondola cars on the cliff above for trans¬
fer to the nearby Weirton mills. Here,
too,
come
giant barges of different types bringing
oil, chemicals and other bulk ingredients
essential to the steel-making process.
again

products are
along the 2,200-mile

Weirton down the Ohio and
to the Gulf of Mexico and
Houston, Texas, 14 barge-days away.

passed

from each

America's

customers

from

More

unload the massive barges

carrying coal and steel

to

Mississippi Rivers

20

naiionai

production

Lakes area.

sion of National Steel.

THt

highways

as

.

CORPORATION
^national/

BY

PITTSBURGH, PA.

MORE

THAN

19,000

STOCKHOLDERS

i

AS**"

7

8

The Commercial and Financial Chronicle...

(2632)

Pacific

Power

Saxton &

Riverside

Dealer-Broker Investment

Thursday, December

31. 1953

Light Company—Card memorandum—G. A.

&

Family Album

Co., Inc., 70 Pine Street, New York 5, N. Y.

Cement

Company—Analysis—ask for report T-31—
Co., 10 Post Office Square, Boston 9, Mass.

Lerner &

Geo. D.

Roper Corp. — Memorandum — H. M. Byllesby and
Company, Incorporated, 135 South La Salle Street, Chicago
3, Illinois.

Recommendations & Literature
It

send interested

to

Stone

mentioned will he pleased

understood that the firms

is

&

Webster, Inc.—Analysis—Bruns, Nordeman & Co., 60

Beaver

Street, New York 4, N. Y.

parties the following literature:
Company

Stromberg-Carison

—

Analysis

—

Eastman, Dillon &

Co., 15 Broad Street, New York 5, N. Y.
Economic Conditions

in Israel

Review

—

Bank

—

L&umi Le-

Upson Co.

Israel, B. M., Tel-Aviv, Israel—paper.

Memorandum

—

Fewel & Co., 453 South Spring

—

Street, Los Angeles, 13, Calif.

Investment Opportunities in Japan—Circular—Yamaichi Secu¬
rities Co.. Ltd., Ill Broadway, New York 7, N. Y.
Japanese Stocks—Earning performances and dividend payments
for

major companies for the fiscal

1953—Nikko

Securities

Co.,

year

ending September,

1-chome,

Ltd., 4,

Marunouchi,

Chiyoda-ku, Tokyo, Japan.
Natural
Gas

New

Gas Industry

Regulation

and

the

Interstate

Colorado

Company'—Analysis—Vilas & Hickey,
York 5, N'. Y.

wjwBfr Notes

NSTA

Street,

Wall

49

V-

„

1954

Booklet
Advertising Department, Manufacturers Trust
Company, 55 Broad Street, New York 15, N. Y.

—

—

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

parison between the listed industrial stocks used in the Dow-

AD LIBBING
Your

for

$9,689.36

representing

Convention

issue

Chronicle."

Affiliates

yield

should be

and market performance over
National
Quotation Bureau, Inc., 46

York

period—
Street, New

13-year

a

Front

published

1954

Register

Directors

of

which

of nationally known companies, titles
leading officers and directors, technical per¬
sonnel, traffic managers, sales managers, purchasing agents,
etc.; includes histories of 80,000 executives; breakdown of
203 classifications of industry, with a products index of over
2,500 commodity and service items—For examination copy
write Dept. A735127, Standard & Poor's
Corporation, 345
Hudson

Street, New York 14, N. Y.

Railroad

Earnings—Bulletin

No.

have

produced

check
Book

and

above

Financial

their quota

Treasurer, shortly.

our

S. T.

Robert

"Commercial

Electric.
•

♦

Alabama

Security

Diana, Ruth,
Bobbie. Bob
Trading De¬
partment of Paine, Webber, Jack¬

Arizona

Security

Anacon Lead Mines

Securities

Boston

Ltd.,

132

St.

James

Street,

West,

Montreal,

Cincinnati Stock and Bond
Cleveland

Dallas

Chase

National Bank of the City of New York—Bulletin—
Laird, Bissell & Meeds, 120 Broadway, New York 5, N. Y.

Erie Forge & Steel Corporation

—

Bulletin

DeWitt Conklin

—

Security

Co.

of

Texas

Memorandum

—

O'Connor & Co., 135 South La Salle

Investors

Publications, Inc.—Report—Loewi & Co.,
Street, Milwaukee 2, Wis.

Diversified

Hanseatic

Services,

an

Study

—

New

—

analysis of Metal & Thermit Corp. and

Street, Boston 9, Mass.
Texas,

Rauscher,
Texas.

Also

dependent

Independent

Pierce

&

Co.,

available

is

School

Milam

Bonds

Building,

circular

a

of

on

—

Circular

San

—

Antonio

5,

a.

report

on

Dealers

Memphis

Security

5, N. Y.

Also

&

Security

Orleans

Club

Traders

Security Traders Association of

Street, New York 5, N. Y.

of the Meat

Also available is

Packing Industry—both available at

Radio

&

Television

a

Co., 63

a

review

and

Co.

St.

More

1,685.80

(Oregon), Security Traders Association of

Louis, Security Traders Club of.
Francisco

San

Security

Traders

Association

Bond

Traders

University,

74

N.

Y.

Telegraph

Booklet

his

we

1,270.30

entire

made

again

staff

express

for

their

possible such

a

our

Jones,

known

1953.

B.

and

titles

leading

directors, technical
purchasing

utives, and
products

commodity
For

a

and

officers
person¬

etc.,

agents,

& Kees.

of -industry,

of

over

service

and

A735127,

Poor's

Alex¬

breakdown of 205

index

examination

Dept.

Ducour-

D.

all

classifications
a

.

Robert

companies,
of

agers,

Zollinger, Jr., Scharff

—

cor¬

includes histories of 80,000 exec¬

•

Secretary-Treasurer

Directors

nel, traffic managers, sales man¬

SECURITY TRADERS ASSOCIATION

Inc.

Register of

porate listings of nationally

The New Orleans Security Traders Association at their annual
meeting held Friday, Dec. 18, 1953, elected the following officers:

&

Street, New York 15,

Executives—Contains

duties

J.

—

1954

and

SMITH, Chairman,
National Advertising Committee,
Pershing & Co., 120 Broadway, N. Y. C.

President—John

.

Broad

Poor's

untiring efforts and cooperation which
HAROLD

Pa.

N. Y.

appreciation to Herb Seibert and

successful demonstration for

Bethlehem,

Advertising Depart¬
Manufacturers Trust Co.,

ment,

Club

$24,223.40
May

copy

with
2,500

items.
write

Standard &

Corporation, 345 Hudson

Street, New York 14, N. Y.
Report

serve

at

Security

are

Security

the

1954

Traders

delegates
convention

were

of

Association

elected

the

to

be

Association

to

J

and

held

.

Keenan,

their

annual

midwinter

dinner

on

Feb.

Bender

Fourth

York

The Investment Traders Association of

Hotel.

Matthew

Inc.,

City, N. J.: Wm. Perry Brown, New¬

in

John J. Zollinger, Jr.

1-

376

Law—A

New

Approach—Jesse Guy Benson—

in

INVESTMENT TRADERS ASSOCIATION OF PHILADELPHIA
NY

Venezuelan Tax, Labor

on

Corporation

National

Alternate Delegates—Joseph P. Minetree,
Steiner, Rouse & Co., and Gilbert Hattier, Jr.,
White, Hattier & Sanford.

invited

Dealers

following

man, Brown & Co., Inc., and Arthur J.
St. Denis J. Villere & Co.

Corp.

Trinity Place, New York 6, N. Y.




Engi¬

Its Territories and Possessions—

252.00

55

The

Troster, Singer & Co.
Members:

of

1954 Holidays in the United States,

63.00

Unaffiliated

Atlantic

2-

Number

(paper).

1,040.30
-

Vice-President—C. Homer Kees,

Gustin-Bacon

2400

the

for Industry — Business
Industry Committee, Lehigh

522.00
—

City Bond Traders Club (Minneapolis-St. Paul)

Wichita

and

Co.

HA

—

ander, Howard, Weil, Labouisse, Friedrichs &

American District

Orders

Israel

Engineers?—A Plan for In¬

creasing

948.60

—

Security Traders Association

Syracuse, N. Y., Bond Club of

*

Your

in

neers

nau

Grinnell

Conditions

5,

Le-Israel,
B. M., Tel-Aviv, Israel.

126.00

Broadway, New York 4, N. Y.

Traded Over-the-Counter

South¬

Washington

Review—Bank Leumi

302.40

cost of $2.

Co.—Analysis—Dreyfus

Economic

8,739.80

Pittsburgh Securities Traders Association.

Institute,

Coal

Building,
D. C. (paper).

182.70

Philadelphia, Investment Traders Association of

importance of coal to
econorfiy — Bitu¬

ern

88.20

Association

Energy

of opin¬

nation's

minous

1,035.40

277.20

NEW ORLEANS

&

ion of the

the
—

One

Number

Resource—Symposium

88.20

Security Traders Association

Co., 36 Wall Street,

Airlines, Inc.—Bulletin—John H. Lewis

America's

360.00
•

270.00

Dealers

Oklahoma Gas & Electric Company.

Corporation—Analysis—Bache

Olympic

Association—

Angeles, Security Traders Association of

New York 5, N. Y.

Northwest

700.20
396.60

Killeen, Texas, In¬

Peabody & Co., 17 Wall Street, New York

Bookshelf

214.20

School District Bonds.

available is

477.00

.

Louisville, Bond Club of

Twin

Minnesota Power & Light
Company—Progress report—Kidder,

Mission

Los

Man's

176.40
,

City (Missouri), Bond Traders Club of

Seattle

Keyes Fibre Company—Bulletin—Coffin &
Burr, Incorporated,

Kingsville,

Security

York

the Municipal Market.

60 State

1,739.60
—

Portland

Inc.

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

Also available is

Association

Security Dealers Association.

New York,

Hearst Consolidated

East Mason

Club

Doyle,

Street, Chicago 3, 111.

Traders

284.20

Houston, Investment Dealers Association of

New
—

Spring

Business

1,332.00

-

Club

Michigan, Securities Traders Association of

Nashville

Organization, 100 Broadway, New York 5, N. Y.
General American Oil

Florida

Kansas

ration, 111 Broadway, New York 6, N. Y.

& Curtis, 626 South
Street, Los Angeles.
son

302.40

Security Traders Association

Georgia

Capitol Records, Inc.—Memorandum—Aetna Securities Corpo¬

and

of the

1,285.90

—

Connecticut, Security Traders Association of—

Que.,

i

J

Association

Traders

Cathy

Carolinas, The Security Dealers of the

Denver, Bond

*

Limited—Analysis—L. S. Jackson & Com¬

Canada.

$63.00

Association

Baltimore, Security Traders Association of

Detroit &
pany,

Diehl is head

Association

Dealers

Diehl,

Debby,

Financial Chronicle"

&

Dealers

D.

Advertising—1953

A.

Chicago, Bond Traders Club of

148—Smith,

Barney & Co.,
14 Wall Street, New York 5, N. Y. Also available is a tabula¬
tion of operating results of 13 Chemical
Companies, and a
comparison of Atchison, Topeka & Santa Fe and General

50

"Commercial

a

Year

listings

corporate

Wall

the

our

the results:

are

Executives—Contains

and

and duties of all

225

by

in

4, New York.
N.

Poor's

participation

our

hearing from Lex Jolley,

Below

'

'

National Advertising Committee received

1953

Jones Averages and the 35 over-the-counter industrial stocks
used in the National Quotation Bureau Averages, both as to

.

™

'NC.

-

Holidays in the United States, Its Territories & Possessions

26

Philadelphia will hold
at

the

Ben

Franklin

443

Company,

New

16, N. Y., sole distributor

the United

States. $50.

Your Investments:
Leo

&

Avenue,

Barnes

—

search

Council,

Street,

New

1954

Edition—

Re¬

American

11

York

East
17,

44th

N.

Y.

Volume 178

<

Number 5286... The Commercial and Financial Chronicle

(2633)

greater percentage increase in airweight as more and larger
utility aircraft were sold for busi-

frame
*

'ness

President, Aircraft Industries Association

Admiral

Ramsey reviews the aircraft industry during 1953,
for 1954. Finds aircraft manufac¬
turing operating under an unusually stable level of activity,
with completion of the expansion
program following outbreak

Since

and estimates its prospects

tions in month¬

unit
duction

military
de¬
liveries, rep¬
resenting 90

to 95%

volume

The

were

into

employi

t

n

n

De Witt

only
slightly in

C. Ramsey

production
airf

afrcraft"

The year saw

£xPa

taken
the

sion

far

SO

111

"
under"

Pyog an?,
the

War

Korean

of

outbreak
the

and

attain-

unit deliveries

as

concerned, of the peak pro-

were

uuciion
duction

levels
ic\eis

peak

airframe

for
ior

eight

year's

though

an

estimated

pounds

of

airframe

been

delivered

producof

terms

m

had^ not been

the

by

that
tridi

bv
oy

military

measured
v

reached

called
caiiea

The

expansion.

tion

Adminis-

new

to

150

end almillion

weight

the

had

been

brought

manufacture

reduced

during

and

the

as

nation's

basl? industrial capacity was expanded' controls on wages and

had

industry's

'

insure

the

that

requirements of
production were met. In
materials
field
the
major

defense
the

nrnhlpm

ronfrnntina

now

^ent a^d

todustrv

*L
titanium.

^

L

.

pf

?s

trnvprn

the shortage

?

?n°rtage

Although

industry

wa's

some"2,000

onl

SeUerseaand sparefU"ch"are

esH-

mated at $9.0 billion for the year,

Monthly
mniion

sales

in

of

excess

wSe be?ng

$900

registered

as

the year drew to a close.

Culminating

the

effort

to

ex-

; pand military aircraft production
,

:

Military Aircraft Production

with the outbreak of the
Korean War, this year's producvolume,

the

was

aircraft

S.

industry. Annual
production during this period has
steadily increased from the 1950
rate of some 3,000 military planes
the

*

fold
'

the

•

in

a very

large expansion

force—from

work

262,000 to
750,000, and in floor space—from
63.5

million

135.8

to

facilities.

new

Of

-

feet,

square

During the period an
some
$3.5 billion was

-

outlay

of
for

made

this

sum

A

nf

ooolnllmf

iq*o

com-

eai'pc

nf

$9 791

mn~

these

by

'

w

companies

World

s nee

tt

.

Despite the decline in military

the

to

1952

sales.

This

sales

to

average

low

level

compared

addition

to

this

piloted air-

missiles field
were

being

as

several

delivered

new

on

a

types

of 5.4%

long-range aircraft procurement

fop^'slhefinancia" health'and
y

requjred

,0

maintain

manufacturjne_en,,jneer;nt,

«?

^

Mcio

..

.

.

'

f,

the

teams
,110

..

pro-

„

.

.

,an' 22' 1954 (NCW Y°rk CHy)
four

new

jet fighter models will

.

Ne™ ,York hSec"r"f ninne^S

reach

f.®t! delfve?ies
:irst aenveiies
transport

end

may

of

a

model for

high-per-

during

the

new

1

world's

carrying aircraft of 83,235 feet.
Several

(4)

aircraft

eleftl0n .of
Associa-

£ng ^

Securities

tion

tl0n'

,

25, 1954 (Chicago, 111.)

aircraft will Jan»

and by year's
Bond Traders Club of Chicago
75% of the mid-winter meeting at the Furni-

comprise

.

fp9iti„,ArA

-ma \

Jan. 29, 1954 (Baltimore, Md.)

Baltimore Security Traders Association Annual Mid-Winter Din<ner

at the Lord Baltimore Hotel.

As the Production peak of the Feb. 26, 1954 (Philadelphia, Pa. )
Present ah- rearmament program
Investment Traders Association
's reached and the reduction in 0f Philadelphia annual midwinter

^e^evel of act^vity itof^ of para- dinner at the
aircraft industry begins,
is
^

_

m,

taken

importance
tQ

will

ingure
not

that

steps

thig

that

dislocate

be

reduc_

the

effec-

Ben Franklin Hotel,

/ir

v

1954 <New York City>

May

Security Traders Association
New

ability to expand rapidly in the
a major emergency.

York

annual

dinner

at

June 9-12, 1954 (Canada)

eve^
a

unofficial

military

1954

past

were:

A

,

tiveness of the industry, and its Waldorf-Astoria.

1953

Among the outstanding accomplishments of American built avi-

products

the

fighter and in all
probability the last piston-engined
bomber will be delivered during

tion

Highlights of

*

turbo-nJon ™An5uf ^
turbo-prop Philadelphia

a

of

ton-engined

mount

exceeded

Investment Dealers2 Association

Therefore, it is imperative that
Canada Annual Convention
national air power policy be Jasper Park Lodge.

a^PfhA

^rn^ram^f

existing

and

prospec-

National Security Traders Asso-

^nl?"al Convention at the

^o e 28-Dec.
an
Nov.
^

tlvf. conditions. Necessary to such
p(dlcy. and

piograming
a

(Hollywood,

Investment Bankers Association
Convention

(1) Maintenance of

3, 1954

Fla.)

the

are

following:

ords> with 754.98 miles per hour
keinS the present official speed
record.

pertinent to

No

at

Hollywood

Beach

strong and Hotel.

Tn

Quoted Market"

experience "no quoted market" really

our

lack of effort. Because unless

a

means

stock is obsolete

or

.

•

the

World

War

II

record.

During

1940-1945 $3.8 billion was invested

in

facilities

million

•

or

<•

10.8%

while

nanced

which

of

only

$420

privately fi-

was

during

the

expan-

sion

resulting from the Korean
mobilization $1.2 billion or 34.1%
was

privately financed.

There

'

were

manv

<

chanees dur-

ing the past 12 months which affected

the

industry

Inllture'flSt^
ISc year's
imr th!!

but

hev did

production

most

of

notSI
schedules

St.

meet

r.

..

..

..

^

level of activity of the aircijft

.

C,vl1 Alrcra" Production

industry during 1954 with any de8ree of accuracy. For the first
several months of the coming year
it appears that unit production of
military aircraft will remain at
the present level— about 1,000
Transport aircraft production for planes per month after which it
the year is estimated at some 315 will gradually taper off, although
Although production of military
Planes represents approximately
95% of the aircraft manufacturing
effort, civil aircraft production
continued at a substantial rate,

"""s> °f. jj?ich ab,out flO were

or'Targer nitt

at the year's end.

In

.

•

*

taking place during the year were.

.

rJ-

The substantial reduction in the
1954

national

especially

in

defense

budget,

appropriations




the

production

,

AmonS the significant changes

for

however

lhat

montMy

tro-

Unfilled transportAircraft duction of military aircraft by the
orders were in excess of 300 units end of 1954 will be appreciably

'

those schedules

nnot be fore-

ut'Uty
was

increased

proximately 8.5%
duction.

duction;

field,

weight, it is anticipated that the
present trend will continue and
that production by this measurement will reach its peak in the
estimated 3,800 second quarter of the year, after
by

was

an

marked

by

an

ap-

even

Take bank

or

active

naturally. We maintain trading markets of
most of these. But even on the tough ones,

our

in

own

even

usually
We've
wire

come up

which it, too, will gradually de-

stocks, for instance. Not the

with

a

held companies,

we can

quote.

110 offices and 65,000 miles of private
help us find the buyer or seller you want.

got

to

We'll he
any

insurance

little known, closely

on

time

to put these facilities to work for you
ask — and we don't think our answer
quoted Market". Just call —

glad

you

will be "No

Trading Department

less than current rates.
From the standpoint of airframe

over 1952 proThe increase in unit proof utility, aircraft from

3,509 in 1952 to

in 1953

airplane

worthless, that usually isn't true.

ones

Merrill Lynch,

at

Scpt- 22-26, 1954 (Atlantic City)

790 miles per hour in attempts to
set new official world's speed rec-

duction basis. At the year's end,r
(5) Volume production of a
note that
a
substantially larger unfilled orders for missiles were 10,000 pound thrust jet engine.
share of facilities expansion re- weU over a billion dollars, alPrnmierK vnr 1954
suiting from the Korean War was though
deliveries
had
gained
"
privately financed as compared to momentum each month.
" is difficult to forecast the
In this respect it is

-

tary air arms will continue to ja*V 14'
*.
A L.
show marked improvement as
Advertising in Action Confermore modern planes with greater ence at the Waldorf-Astoria Hotel.

monthly military aircraft output, ture Club.
for all ^953 saw delivery of the last
pis- T
9q
1Qc;ii

ing and during the past year, for ume production.
(3) The establishment of a new
the first time, the number of jet'
(3) The establi
ir>ffirini aitituHp rprorri for manpowered
planes
produced
exunofficial altitude record for man

In

nilpifl„.

Mil{fo

to

^

(1)

plane production, the industry intools creased its activity in the guided

,

We.a^°!Js*

In this connection it is pertinent

ceeded piston-engined plane production.

..

(4) Recognition of the vital imtion, it is anticipated that sales P°[tance to national security of

services.

profits

year

1952—Approximately 9,000.
1953—Approximately 12,000.

UP-A'£

and production teams

and to p™vlde the Military Servlces wlth the la*est and best

will gradually decline
725,000 by the year's end.

the year are estiProduction of jet
m JS?9 °F
7° °, continue to increase

^rcl ?
mat®d a*

ation

1951—More than 5,000.

-imnnrtanf

®ft?eedengineering
with the second quarter

some

a going rate

nr^nM:n„

arP

largest volume of sales reported

Some

after June 1950).

<3> Maintenance of

.

volume production during Association 28th annual dm
pftn
Thrpnrp<;pnt<,
A 'inrrpa^p the coming year and deliveries of the Biltmore Hotel*
f one/
,-n thAnast vear and i<? thp ^et bombers will continue to inJan. 22, 1954 (Philadelphia, Pa.)
0t 37% in the past yeai and 1S the prpa«>p
Alcn
in
nrntjnppf
the
narpra

follows:

ap-

proximately 66% < was for
and equipment and the balance
for plants and structures.

:

to permit rapid expang[on in the event of an emergency

.S/'es VOlUme °f the 12 largest

began to
than 27,500 units. By years,
are as

production base within the

industry

current

possible by

•

•

more

interna-

(2) Maintenance of a sufficiently
broad

eed
speed record of more than 1,600 aircraft
researchj development and
figure. This four- to note that the percentage of miles per hour.
(2) Deliveries of the first suoer- Procurement
be established and
increase in deliveries during combat types (fighters and bomb/ox Tx~,!
past three years was made ers) has'been 'constantly increas- sonic combat plane to go into vol- maintained at all times m accordance
with

•

to

than

at more

Finances

hostilities
ilities

tion,
U.

'

brtogs&tai

brings the total
0f military aircraft proc
t produced since
Korean

the

in

a

the in-

dU?-.ry'S P,r°d uc.ti.°.n activities,
"jditapf plane output is estimated
afi approximately 12,000 units ot

1950—Slightly less than 3,000
(of which some 1,500 were built

third largest in the history of the

reflected

was

of detailed information

the

in

air-

manufacturing industries — again
points to the need for increased
flnancial strength, coupled with

_

the estimates

dollar

produced

of

Although military security restrictions on defense production
information preclude the release
on

fluctuations

through-, and commercial transport produc-

weight

force is estimated
1,000,000.

of

begun

in

craft

promts

tons,

^

military and civil customers.
This relati\ ely high level of activity was reflected in the sales

to

r/_ War II.

materials experts in|icate a
qUirement 0f at least 250,000 tons
1900
titanium production in
1953

odic

and

of peri-

for the year will be close to the a healthy, stable private aircraft
$9-0 billion figure estimated for. industry financially strong and
the gradual increase in employ- 1953. Sales volume of the 12 larg-, unhandicapped by a policy which
ment.
By August direct employ- est airframe producers again is limits its profits on sales to less
ment had increased to more than expected to be on the order of than half the national industrial
profit average.
755,000, compared to 711,000 on $5.0 billion.
industry's payrolls in December,
Also in prospect for 1954 is a
1952. It is estimated that by De- continued curtailment of the large
cember, 1953, some 770,000 work- scale subcontracting which marked
COMING
gpg were engaged in aircraft prothe Korean War production exduction
a
three-fold increase in pansion program. More and more
EVENTS
direct
employment
since
June, work will be performed by the
In Investment Field
1950.
Counting the employees of prime producers as their producsubcontractors and major suppli- tion rates are reduced,
ers, the aircraft production work
The striking power of our milir|.
.
airframe

average

estabUshed to

was

fur-

In "" probability cuipivjuiciiw
all
employment^
"

ginning

out the year> the increase in the

^and " 0T prio'riUes
and allocations

Pfoduction for
was increasing.

purposes

prices were removed. Direct con-

the completion of

following

ment,

terms

measured in term

liveries of civil
the

in

measured

e

who

aircraft

were

keeping with the gradual increase
f

or¬

the post-Korean expansion.
As many military requirements

-

creased

in

policy of the

licenses

month,

e

increase

to

models;

the phasing out of many of the
major subcontractors and

1,000 planes

.

and

units remained constant

narrow and deepen the
production base which resulted in

approximately

m

funds

newer

ofresearch

developmentJirrespective

™ovf™fnts-. Increased production

Although production in terms of
.

tration to

formed,

and

for

of

per¬

'

per

added

ders

a

program

active

a

units,

of the year,

future production schedules
certain older aircraft types to pro
pro-

vide

all

of

Employment

from

of the

work

■

dollar mark

of

reprogramming
toh.,h°:iimS
procurement which eliminated
which

; aircraft

in

field

helicopter

civil

A

rates

preponderance

mobilization
.

pro¬

as

,

which

responsibilities;

ly

the

,

backlog exceeuea the nan billion
uacwiug exceeded uie half Dinion

$4.0 billion;
reorganization

The
broad
governmental

marked

as

the reduction

consecu'ivet yea^ accuracy3"1101 ^ f°'eCaSt WUh
manufacturers
accuracy.

Th°r
the

some

unusually stable level of activity.
There were no significant varia-

.

aircraft

as

the commercial

was for milutility aircraft and in helicop'itaycustomers, information is not ters tor commercial-use is in prosavailable as to numbers produced. Poet, although the degree of in-

Though high level of activity is main¬

of

In

/-

helicopter production

tained at year end, uncertainty marks outlook for year ahead.

During 1953 the aircraft manu- procurement
factoring industry operated at an amounted to

degree

ther decline in transport airplane tional situation. Such a program
Helicopter production was at an production is in prospect despite should use the full competitive
all-time high and constantly inanticipated increases in air values of a resourceful aircraft
creasing throughout the year. Passenger travel and in airfreight industry.

By ADMIRAL DeWITT C. RAMSEY, U.S.N. (Ret.)

of the Korean War.

purposes.

cline, although not to

9

Pierce, Fenner & Beane
NEW YORK 5, N. Y.

70 PINE STREET

Offices in 105 Cities

The Commercial and Financial Chronicle

(2634)

10

had

The Role of Commercial Banks

'<*"?.

Commodity prices, as the chart
shows, during the Mexican War

banking system had been im¬

Suffolk
System
Boston (1818). This was where

in

the

by

the

Suffolk

charged

By JULIAN GERARD BUCKLEY, Ph.D.

of

Bank

and

Boston

inflation and to subsequent de¬
clines in prices.
Gives data on methods of financing, the
War of 1812, the Mexican War, the Civil War, the SpanishAmerican War, and the two World Wars.

their

windows

There is

for

v

there¬

years

declined about 2%.

again, it is possible to
prices did not rise in
great part because the war was
financed by sales to individuals.
There were, by this time, many
more

payment.

rich

1845

system had their notes presented
at

two

>

that

say

banks not subscribing to this

ever,

often contributed to postwar

for

,

Here

surrounding

giving stability to the
local currency and was, in effect,
the
first
clearing house.
How¬

banks, in making advances to the government, have

and

period

banks thus

Buckley traces the role of commercial banks in the wars
of the United States from 1812 through 1945, and indicates

$63,000,000. '

.only

after actually

Boston

redeeming the

fee for

a

of

notes

Dr.

total

*

the

Financing United States Wars
that the

the Mexican War which amounted

severe

to

proved

In

the

from

recovered

panic and depression of 1837.: Also

there

than

men

in

were

City alone, 72

in

1812.

New

By

York

with estimated

men

Thursday, December 31, 1952

...

the

bonds

sold

were

largely

/

The total loans sold by the gov¬
ernment

during

amounted

These
with

to

the

period

war

about $2,600,000,000.
brought out at par

were

interest

rates

to

up

7.30%.

Secretary of Treasury
number

a

dictate

Chase,
occasions, tried

of

the

terms

lower

rates

of

the

than

the

humiliating results. An ex¬
ample of this was dn January,
1864, when he tried to sell bonds
at 5% due in 20 years, although

Throughout

history of the
United
States
and
particularly
in the past 25 years, the prestige
of

the

commercial

the

has

banks

risen

fallen

and
num¬

a

ber

of

I

wartimes,

n

the

times.

banks

asked

when

by

the

gov¬

ernment

for

George Clymer, the President of
the Philadelphia Bank, received a
salary of only $3,000 a yea r;
Maltby
to

tried

ever

b 1

to

i n
possi-

y

Clarkson, President of the Bank
believed to be

of New York, was
worth

But this

actipn

of

banks

the

in

of

Julian

G.

contrib¬

often

Buckley

uted

decline dn

eventual

the

commercial

from

the

1812

to

amount

ernment

of

banks.

not

available

the

and

debt

on

Where

are

financial

literature

period.

Lastly

tion

the

in

the

made

postwar

of

the

of

price

riod

These

Philadelphia

included

is

cause

in

the

City Bank

America

the
that

in

main
the

it

was

York
to

Secretary

Gallatin

at

first

nor

the

these

bankers,

the banks

were

nor

salaries.

reality

did

In

only

they

fact,

receive

they

glorified

of




the

Suffolk Bank

in

the

were

Safety

in

Boston.

in

State

York

War

broke

in

ment

the

the

000,000
small
A

two

lasted

war

of

the

and

out

bonds

as

enormously
and

of

Nov.

1,

of

these

$19,000,000

1856.

unable

were

to

take

of

limited due to the liqui¬
the central bank—the

United

the

'

Y

.

States—in

was

to

rich

the

'

believed

to

is

this

why

reasons

of

one

to

a

the

prices

material

degree.

By 1817, two years after
the end of the War of 1812, com¬
modity
about

had

risen
only
the level at the

prices

24%

over

start of the

The

1846.

21,

bids

When

all bids were opened it was found

certain Mr.

a

Kershaw,
actuary
of the

spectable

a

re¬

"ex¬

ploded" Inland State Stock Navi¬

Mexican

try

was

stronger

War

sent

was

deliver

the

New York

to

bonds

and

to

re¬

ceive the money.

of

the

the

end

of

after the Civil War,
largely to the increase in
which increased the

.years

due

greenbacks

supply.

money

Spanish American War
The
1898

Spanish American War
such

was

3%

in

small affair that

a

the economy.

on

issue of $200,000,000 of_

one

due

bonds

1918

floated.

was

inconvenient

Bank of New York—agreed to un¬

and the

derwrite this issue severally. This

firm

had

be

the

played
firm

Corcoran

of

and

Riggs
part.
This

dominant

a

formed

was

to

"found
at

it

*

once

bids

readvertised."

syndicates in New York City
—one headed by J. P.
Morgan &
Co. and

by William W.

War

by the National City

one

patriotic

inspired

action
the

in

dence

Civil

The

a

former

clerk

confi¬

government so that

the individuals oversubscribed for

the time of the Civil

By

in- the

War

the country had shown great gains
in economic strength.
But over

Second Bank of the United

States,
by George Washington Riggs,

and

of the wealthy Philadel¬
expansion was taking place in
merchant, Elisha Riggs. the railroad, industrial, and bank¬
Corcoran & Riggs prospered not ing fields. As a result of this overonly during the war but after¬ expansion, a serious panic hit the
wards and eventually became the country in 1857 from which re¬
covery was slow.
Treasury bal¬
Riggs National Bank of today.
son

It

is

estimated

that

the

participation

of

banks

financing

in

small.

war

As

far

as

the

ebb

can

was

be

It

debt

was

about 6.0%

outstanding

at

the

at

were,

the

a

low

aforementioned

well

as

as

to

28, 1860, to float an issue of $10,000,000 of one-year Treasury
Bids

notes.

of the

end

to

fear of open rebellion.
Secretary
of Treasury, Thomas tried on Dec.

by only about $4,000,-

000 which

due

panic and depression

very

deter¬

their holdings of govern¬

debt

credit

and

ances

direct

commercial

received

were

for

only $1,831,000 at 12%. Other bids
ranged from
15%
to
36%
and

of

rejected.

With

issue

At the end

their

creased

(Buchanan

in Administra¬
Lincoln)

to

the

Percent Increase in Money

Supply during War

banks in¬

holdings

of

two years

Commodity Prices,"

and

by

This

issue.

new

ever,

about

how¬

increase,

only about 10% of the

was

at the

total debt

of the

end

During the first 15 .years of the
twentieth

centry the influence of

the bankers grew

in spite of their
supporting Senator Aidplan for the National Re¬
serve
System.
A large number
of
bankers
headed by Paul M.

defeat in

rich's

the Owensthe coun¬

supported

Bill

Glass

try

which

gave

Dec. 23, 1913, the regional

on

the

the

open

new

rebellion had started.

Secretary

P.*

war

000,000

Treasury,

of

Chase, at the start of
,

to

came

New

ask the bankers to
•

war.

Commodity prices increased only
moderately.

though
Salmon

after War

gov¬

$100,000,000
largely to the attractive yield
circulation privilege of the

due

the Federal Reserve System.

The
Percent Increase in Wholesale

to

of the war,

it is estimated that the

ernments

had

allotments

and

made.

be

Warburg

change

a

the

finances of the government,
strangely enough, improved even
~

End

the chart
two

22.0%

at

Commodity prices, as
indicates, increased 88%

war.

over

for

LEGEND

at Wars

about

to

about

to

increase

to fork

sold,

were

OF BANK-HELD DEBT, MONEY SUPPLY AND PRICES

of Debt

assets

This

outstanding

the

gov¬

incident,

bonds

most

tion

percent

total

Only

were

a

bringing

$1,700,000,000.
debt

of

part, at a small premium.
Throughout the Mexican War, the

these

coun¬

condition.

Increase in Bank Held Government

a

during the

holdings

it had little effect

to

sug¬

and

bonds about $600,000,000

Treasury

1 Vi

Chart I

A COMPARISON

their

increased

at 6%, plus a premium
%.. This bid was preferred,
and an agent of the Secretary of

securities, sold in the War of 1812,

creased

better organized and in

financial

that

estimated

is

ernment

amount
of

taxes

period the commercial banks

Co., had offered to take the entire

(or

alternative

made

added
bond issue of 6%).
It

journeyed
Secretary

see

Fire and Water Insurance

gation

war.

By the Mexican War, the

as

Nov.

sealed

to

(of

gestions

amounted

$5,000,-

was

for

date

committee

Two

ment

large
in

for

set

that

a

mined,-the commercial banks in¬

clerks.

was

National

a.

bankers

York

and

the

■

merchants

commodity

increase

Chase

action, he
by the

When the agent
presented himself to Mr. Kershaw,
Mr. Kershaw, as Niles reports the

the

failed

be of

war

moments.

loan

war

the

and

was

the

of

anxious

some

The first
000

About

bonds

profitable

the U. S. Treasury did

men,

have

Treasury notes.
typical bond issue was the 6%

bonds

1,000
1,200

financed with small cost of money

of

amount

3,000

war

$49,-

well

as

4,000

Although this really small and

which

about

York,

Washington

C. Vanderbilt

govern¬

in

years

issued

of

of New

New

Lorillard

was

"greenback"
of

opposed

President

Bank

Secre¬

Headed by James Galla¬

bankers.

of

5,000

Anson G. Phelps

1838

the

course

vigorously

was

6%.'

was

on

In this

to

Jacob

1829, the, Bank Note

New

insisting

tin,

Redemption Law in Pennsylvania
in
1824, and the Free Banking
Act

rate

W, B. Astor
Peter Stuyvesant

agent

improvements
Fund in New

banking

market

—$25,000
Stephen Van Rensselaer___ 10,000
Stephen Whitney
10,000

J. J. Astor

phia

is

In

1812.

were

result

a

was

securities

of

material assistance to the
govern¬
ment. The bankers were not rich
men

debt

ing system, bought the bonds. It

however,

able to

slowly. He
count $500

notes
day to

As

Wealth

disgusted and returned to

Other

words, individuals, not the bank¬

banks

of

the

that Secretary of Treasury Galla¬
tin was forced to appeal. In §ther

Treasury
appealed
for
war

notes.

became

Corcoran,

of

funds to finance the
Neither

City.

were

It

Philadel¬

the Bank

and

New

at

Thus the in¬

war.

1811.

phia, the Massachusetts Bank in
Boston, and the Bank of New
York, the Manhattan Company,
the

banks

outstanding

debt

close

Bank

America, and the

Bank

their

1812

bank-held

in

dation

North

that

largely be¬
credit expansion possibili¬

ties

of

con¬

This might be
$127,300,000 of

with

more

At the start of the War of 1812,
there were about 90 banks in the

country.

of

$20,500,000.

banks

any

described.

Bank

of

the

whole

a

Estimated

about $65,000,000

War

the

of

the

the

infla¬

periods

counting
took

the

issue.

(000 omitted)

outstanding about
85% of the issue) were sold
war.
(See
by
the firm
of
Corcoran
and
chart showing
a
comparison of
Riggs. This banking partnership
bank-held debt, money supply &
had
several
branches
and
sold
prices.) The cost of the war was
the bonds, in great part, to rich
about $100,000,000 and the debt
individuals.
In
contrast
to
the
issued was about $80,000,000. But

are

search

hit

1813.

at

commer¬

estimates

to

banker, not being able
redeem these notes in specie,
upon the ingenious device of

York City in

were

about 16% of the debt

gov¬

intensive

an

Some of these men were:

(which eliminated much bribery
A good part of this was
and corruption in connection with
loaned.
Nevertheless, it the
granting of bank charters).
is estimated that during the pe¬
On May
13,
1846, the Mexican
in

crease

wars

figures

much

to

estimated

the end of the

discuss

the

of

is

it

redemption.

This Maine

their

on

loans.

banks

total capital was

government

prices.

in
to

bought by the

cial

based

banks

1945

cerned

the

as

compared

detail, the role of

some

the government

about

It is the purpose of this thesis to

trace, in

subscribe

account

far

not

States Government securities

in

great
part to the postwar inflation and
to the

could

increased their holdings of United

has

wars

bankers

own

for

notes

It is obvious that

$30,000.

these

his

already

manner.

e

worth $10,000; and Mathew

be

As

cooperate

the

of

Manhattan Company, was reputed

advances,
have

President

Gelson,

his

of

at

with

000

confronted

to

market,

tary Chase's greatest mistake

story of a Maine banker

a

was

on

issue

wealth of over $500,000 each and
by an agent, combined wealth of over $110,000,from the Suffolk Bank with $3,- 000.
:
-V;' 'A.;.;

who

to

'^

people. \

of

York

to

purchase $150,The

bonds.

leading

central

banking system known as
When

World ' War

in

Europe
bankers

The

in

were

supporting

broke

I

structure.

credit

Gold

famous

the

forefront in

the

the

Fund

formed of $100,000,000

was

in gold by

bankers,

the

of

action established confidence

including Moses Taylor
City Bank, C. P. Leverich

the

of the Bank of New

A.

Dana

loans

The

to

in

important contribution
general confidence was made by

to

the

of

these

take

market.

This

individuals

of

They felt they should be
Secretary of the Treas¬
ury Chase, on the other hand, in an
arbitrary manner, insisted on

and

Another

help

considerable personal wealth and

City bankers. This

exports of specie ceased abruptly.

they

terms

were

of

but

War

with the

accord

bankers

Bank

willing to

the

set

York, James

Suffolk

were all
the Civil

Boston,
finance

wished

the

of

New York

in

out

1914>

August,

Cotton

Loan
of

care

fund,

saved

from

Fund

the

also

scores

of

of

of

cotton

1914

to

surplus.

$100,000,000,

southern

banks

closing.

power.

consulted.

specie payment.
a

part

of

the

As

a

result only
bonds

$150,000,000

World

When

this

the

war

This,

the

backers,

coupled with disastrous

news

York

war

high government deficit, re¬
in the issues of "green¬
backs" of about $431,500,000.
sulted

But

ment

the
was

credit

of

rescued

by Jay Cooke.

govern¬

great

part

Under his guidance

and

with

over

$2,000,000,000,

the

the

in

aid

of

the

banks

entered

World War I in 1917, the bankers
took a^ prominent part in selling

could be sold to the banks.

and

War I

country

bonds.

City,

government.

But

in

addition

particularly in New

were

advisers,, to

Bankers

.

the

of the day

Charles
H.
Sabin, Jacob
Schiff, Gates W. McGarrah, J. S.
Alexander, A. H. Wiggin, and F.
A. Vanderlip.
The bankers were
keenly conscious that bonds
were

should be sold to the individuals

'

fimv (Htwu On

km

Includes

holdings of Federal Reserve !

or

77% of the

and

not

to

the

banks.

Mr.

J.

S.

Volume 178

Number 5286

The Commercial and Financial Chronicle

...

Alexander, President of the

Na¬

ing

bankers,

(2635)

The

bond

money
supply
increased
during the war period and
meeting at the Federal commodity prices by two years

government

>

tional Bank of Commerce of New

York,
<

called to

the

at

of

start

the

First

a

Liberty Loan, pointed out the de¬
sirability of selling a substantial

Reserve Bank of New York. From

part of the bonds not to the banks

;

of confidence and

for their

account

own

but

the

to

this

there

would

be

the

Mechanics

&

Metals

be

large

expected

of

part

tie

to

their

up

any

in

resources

government loans.

period,

the

creased

June,

in

emergency

in

only $70,000,000.

banks

Reserve

their

creased

the

and

System

holdings

of

period by $4,259,000,000.
crease, was

the

in-

war.

the

war

only 17% above the level at

the start of the

-period,

the

pledged

the

.peak

bankers

of

their

emerged
life.

prestige.

from

patriotic

World

leaders

The

big

War

reached

I

of

Wall

.Street, such

as Charles E. Mitchell,
Morgan, T. W. Lamont, Al¬
bert H. Wiggin, Seward
Prosser,
William Woodward, and others in

-J.

P.

.the public mind were vested with

-almost superhuman financial skill.

Fantastic prices in the late

1920's

paid for the bank stocks. For

-were

^example,
«stock

'Share

in

to

City

price

a

1929,

paid

Bank
$585

of

although

in that year

-earned

-and

National

rose

it

$4.85

dividends

the

only

$2.45

a

interest

When

"came

the

in

ticularly
-haps

to stem

their

-taking

stock

the

On

service

was

becoming

financial

a

the following

In

the

years,

hemorrhage

failures
such

which

losses

the

At

of

followed

that

bility of the bankers
-emphasized.

depres¬

the

falli-

cruellv

was

of

end

1930,
Bank of the United
States,
large commercial bank in New

the
a

York

City, closed its doors. In the

next two years, a number of banks

all

the

over

to

country

Federal

York,

suspend

the

for

causes

time,

present

and

least

"I

$200 million of addiv

debt

is

lfate

tax

many

economists

believe

paid

the to

by

under

purchase

to

of

bills

and

to the farmer

it

learned

was

the

of

Bank of New York

gether

happy

desired

and

ticularly
The

less

on

this

thing

be

Milton

banks and

Leeds

Throughout

World

II, the

War

bankers
servedv on
Committees to sell bonds to indi-

investors.

These

encouraged,"

Mr.

included

J. P. Morgan, W. R. Burgess, Win-

U. S..Treasury.
*

.

"Stock values

on

the

in the majority.

commercial

banks

Honor E_ Lowjtz
of

the

all

of
York

floor Dec. 24 in honor of the
38th birthday of Elick Lowitz.

listed

on

U.

Lowitz,
are

his

all

and

son

Stock

his

Exchange

S.

preferred

corporations

the N. Y. S. E.

jSgUe aione
mours—is

*n§

Mr.

and

common

of

stocks

New

Stock Exchange staged^ an imPr°mptu celebration on the trad-

the

coop-

;

<

Fontaine, Vice-Presi¬
dent, Merrill Lynch, Pierce, Fen¬
ner
& Beane,
New York; Paul
Schroeder, Secretary, Merrill
Lynch, Pierce, Fenner & Beane,
Chicago; Richard M. Ross, Treasurer,
Dean Witter & Go, New
York; Thomas B. Meek, Chairman,
Executive Committee, Francis L
duPont & Co., New York.
Be¬
gional Vice-Presidents: E. William
Ohman, E. F. Hutton & Co., Chicago; Elmer Larson, Merrill Lynch,
Pierce, Fenner & Beane, Detroit;
,

—

~

,

time,

same

City Robert David^n,Fa^
& Co., N^Y City Marshall Dunn,

fetmuary^1^, then lost all of wo°a, btrutners & Co, N. Y. City,
the gain plus $1 billion from Feb^ *re
^ Elsesser, Kidder, Pearuary to September, 1953. A little -body. & Go->
Y. City; Donald
more than half of the dollar value
;£•
' Eastman, Dillon & Co,

minimum

Take

are
one

E. I. du Pont de Nehave

estimated
'locked

in'

or

a

unreal-

far

so

as

^on & Co, Chicago; James V.
Condrin, Harris, Upham & Co,

GhicaS°; Albert J. Curley, Bache
&
Co, Detroit; George Martyn, W.

Hon during the past four years on Arthur J.

floor more from this source this year,"

traders could recollect.

Y. City; Bernard J. Cunningham, Goodbody & Co, Chicago;
James P.^Doherty, Jr., E. F. Hut-

*zed Pr*ce aPPrecia Jon of $1.9 bil- e. Hutton

Rentschler, W. C. Potter, J. C. members, and all are members of which the potential tax liability
Traphagen. However, it is worth the firm of E. Lowitz & Co, 29 could amount to as much as $300
observing that a study of the Broadway.
million.
So it appearsto us that
Committees to sell bonds in World
They are the only father-son-,.fh
w
amDlp ODDOrtljnitv for
War II the bankers were in the
grandson combination ever to hold
ample opportunity foi
minority whereas, in World War stock Exchange memberships at the government to have collected
were

were:

he continued.

Lynch,

&

Pierce,

Seattle;

Co,

Philadelphia;

Lattimer,

Robert

Jr.,

Fenner

Merrill

&

Schenck,

Beane,

Burton,

Cluett & Dana, Washington, D. C.;
Robert

Pureell

T aidlaw

*

Washington, D. C.

Jack B. Huhn

of Bache & Co, New York,
elected

Honorary

failures

These

seriously

in

the

banks

With

the

in

and

the

of

advent

bankers.

the

Roose¬

This

Banks.

valuable

in

transfers

assistance

Republic

in¬

was

tracking down illegal

of

The

funds.

industry,

Chile

bankers

made credit available to

of

Notice

to

Holders of Dollar Bonds of the

following Loans:

velt

Administration, a number of particularly Regulation V loans
banking
reforms
were
enacted. which reached a peak of $1,750,-

These

included

hibited

banks

laws

from

which

investing in stocks,

or

pro¬

underwriting
under¬

or

writing corporate bonds. More im¬
portant

the

surance

Federal

Corporation

In¬

formed

But

Deposit
was

small

depositors

of

of the

commercial

banks. In great part as a result of
these

reforms,

ceased

almost

failures
Further,

bank
entirely.

consumer

loans

Republic

the

War II

in Europe

in

1939,

however, the prestige of the com¬
mercial
banker
had
only
re¬
covered

was

effort, it

was

System

His

opinion

on

private

even

or

no

<

culed

..

ignored.

or

On

the

The

Mark"

Federal

the

as

for

or

scribed by banks.

the

Federal

Reserve

*

mously.
t

.

On

■

.

and

Monday,

Dec.

8,

1941,

the

the Japanese, the lead-




External Loan

Chile External Loan

Sinking Fund 6% Bonds, dated March 1, 1929

of

Chile External Loan

Sinking Fund 6% Bonds, dated May 1, 1930

bills.
6.4%

were

to

of

the

the

Chile Guaranteed

Sinking Fund 61/2% Bonds, dated June 30, 1925

sup¬

Mortgage Bank

of

Chile Guaranteed

Sinking Fund 63/4% Bonds of 1926, dated June 30, 1926

Mortgage Bank of Chile Guaranteed

Mortgage Bank

ber 31,

eight
sub¬

people. 'Yet
the

at

govern¬

ment securities held

the

Federal Reserve

System)

of

to

$114,300,000,000.

was

33%

This

*

>

of the debt outstanding

Fund 6% Bonds of 1929, dated May 1, 1929

Sinking Fund 6% Agricultural Notes of 1926, dated Decem¬

1926

Chilean Consolidated Municipal Loan

Thirty-One-Year 7% External Sinking Fund Bonds, Series,,

A, dated September 1, 1929

City of Santiago, Chile,

Twenty-One-Year 7% External Sinking Fund Bonds, dated January 2, 1928

city of santiago 7% External

Sinking Fund Bonds of 1930, dated May 1, 1930

Treasury Decree No. 11174 of the Republic of Chile, dated December 14, 1953,
notice is hereby given that the Offer of the Republic of Chile, dated December 7, 1948, to holders of
dollar bonds of the loans listed above, will remain open for acceptance until December 31, 1954.
Holders of dollar bonds who desire to accept the Offer should deliver their bonds together with form
In accordance with

letters of acceptance

57

and transmittal to the Fiscal Agent of the Republic, Schroder Trust Company,

Broadway, New York I5,i New York. Copies of the Offer and of forms of letters of acceptance and
may be obtained from said Fiscal Agent.

transmittal

Republic of Chile

increase

at the end of World War II.

Sinking Fund 6% Bonds of 1928, dated April 30, 1928

Chile Guaranteed Sinking

Mortgage Bank °Of Chile Guaranteed

as

Truly this would

war,

Bonds, Guaranteed Loan of 1915, dated December 8, 1915

of

were

In

Sinking Fund 6% Bonds, dated September 1, 1928

had increased from $24,100,000,000

day following the attack on Pearl
Harbor by

end

and

.

World War II

Chile

of

of

Mortgage Bank

by the bank¬
had grown enor- ing system (the commercial banks

.the government

-

System

the

Railway Refunding Sinking Fund 6% External Bonds, dated January 1, 1928

war

all

Reserve

bonds

%%

$10,106,000,000,

1927

Chile

Water Company of Valparaiso 6%

loans of $156,893,000,000 only

other securities

-..hand, .the power and influence of

of

Republic

determined

that

government

liquid
war

Sinking Fund Bonds, dated February 1,

Republic

the officials

seem
to be the complete fulfill¬
degree as in the 1920's. If a banker ment of the expressed ideals of the
came
out in print with a stateTreasury and of the Federal Re¬
ment, his words were often ridi- serve officials to sell government

,

.

little.

a

matters
longer sought to the same

public.

long

Chile 6% External

Republic

general business and employment ported faithfully the pattern of
began to improve as the thirties interest rates until the public be¬
advanced.
By
the
outbreak
of came convinced that the 2V2%
World

Sinking Fund Bonds, dated October 1, 1926

of

Twenty-year 7% External Loan Sinking Fund Bonds, dated November 1, 1922

Treasury and of the Federal

"Plimsoll

loans.

Chile 6% External

Republic

by

expense

spite of their support of

Reserve

the

of

chile

of

Republic

banking.
in

war

of the

amount

of

Republic

were

siderable

ration

which insured virtually all
f

000,000. Also

discouraged by the bankers. Last¬
ly, the bankers incurred a con¬

(

Dated: December 30,

By Caja Autonoma de Amortizacidn

■

de la Deuda Publica.

1953.

-

i

was

Vice-PresidenL

operations

shook the confidence of the public

Pn

Robert Pureell Laidlaw & Co,

causing erated in other ways. They as¬
heavy losses to' the depositors. signed members of their staff to
This was particularly true in De¬
work
with
the
Foreign
Funds
troit,
Michigan
and
Cleveland, Control of the Federal Reserve
Ohio.

the

governors

„

,

throp Aldrich, Edwin C. Maynard, grandson

The

Leeds,

stated Francis I. duPont & Co., Los Angeles. Governors: T. Alvah Cowen,
New York Peter P. McDermott & Co., N. Y.

G. S.

I, they

Mr.
and

Leeds

monetary

Members

commercial

vidual

sound

monetizing

the debt.

to

officers

ailCl tlie • snorter the holding Frank Bastable, Bache
& Co.,
more
realizations
are Washington, D. C.; Walter E. Wesp,

lale

iurt^er-

eral Reserve System and by the
,

capital

Armand

and fiscal Stock Exchange increased over
the policies are followed by the Fed- $8 billion from October 1952 to

deter*-

addition

on

future.

Period,

the that

mined, few realized that this was
tending to drive the government
debt to the

commer-

to convince the public of their essential function,
but also insist

par-

was

can

that the

emphasized.

pamphlet

elected

experience that the lower the

our

believed

rial bankers of today should
speak
out more boldly and try not only

bankers pro-

any
as

It is

pattern

about

pattern

if

far

implications.

not alto-

were

about

this

As

tested.

certain
Reserve

near

In

of

sociation

a

other

Co., New York

eral Reserve System and the U. S.

Leeds

gains in the

of Pershing &

or

Mr.

would issue

™

higher rates,
the short end.

peculiar

setting-of

that

Federal

to the in¬

He announced that his association

Only a few bankers have mate is based on a canvass of our
pattern of interest rates was set pointed out tnat the cneap money members throughout the country
at
%% for certificates, at
policies of the Treasury and the who report large amounts of unfor 5-year notes, and at 2l/z % for price supports of the Federal Re- realized profits and large numbers
the long-term government bonds, serve
System have inflationary of frozen accounts. It has been
officers

as

vestor,"

period three

price to yield %%. Also the whole sides.

Later

well

as

the-holding

sell-Treasury took place in 1950 and investors' Brokers at its annual
fixed ,1951, the bankers declined to take meeting on Dec. 21.
"This esti-

a

-

high soeed in this countrv. Reme¬
high speed in this country. R,medying this defect will be of lon£
range benefit to our economy, and
that, means benefits to labor and

^een

26 %

or

at

t

"The capital gains tax is one of
,

12^% instead
of

free government bond market. Yet

Reserve Bank of New

agreed

if

the

of

one

more

a

obtained

Under -the

inflation.

operate

been

^10na^ revenue would have been the principal causes of the decline
c°Hected *n *953 from the capital in equity capital needed to keep
gain* taxes by the Federal Gov" the wheels of industry turning at

commercial bankers have in City, who was
main been reluctant to ex- elected Presirate. That is, the press their views. When the so- dent of the
System through called dispute between the Fed- National As-

Reserve

amount

any

forced

were

"At
+.

April 30, 1942, the bill rate the
set at
% of 1% and called the

the "Posted Bill"

about $1,077,000,000 of

panic from

-caused

Per-

loans and preventing the

-disaster.

*bank

crash

panic.

greatest

over

brokers'

market

1929, the bankers, par¬
in New York City, at¬

tempted

sion

rate

fact that few,

share.

.At

bankers

have

v

would

funds

Treasury would be low.

share

a

of

a

J

'

.

themselves ithat bank-held

Treasury. They

as

community

bankers

Reserve

country.

our

would

12J/2% instead of 26% and hold¬
ing period reduced to three months.

be leadership of the Federal Reserve instead of six
with- System, the rigid pattern of gov- months," acout limit, that investors would be ernment
security prices has been r ° r d i n g to
protected against loss, and that broken. An attempt is
being made Milton Leeds

They the Federal

War

of

I

the

that

revenue

available to the government

war.

post-World

for

the -Federal

to the needs of the

was

During

-

matter, the

subordinated

This

of

end

that

System,

S.

and

of additional

'

commercial

of

U.

million

'•

i

the

officials

.only 17% of the debt

after

..years
-were

•'

time

'a^

amounted

bankers

money supply increased 26%
the
commodity prices two

and

this

At

the Increase in bank-held debt to debt
to
the end of the warwa. the

during

System

period

in-

.outstanding at the end of the

:The

Reserve

eral

Fed¬

only

Treasury Huge Revenue Loss

maximum tax rate had been

money

'supply and commodity prices was
moderately. Total'by far the greatest in World War
purchases of securities by the Fed- 'jl
Also
the
nercentaee
of
the

$2,712,000,000

Government? securities during the

*

Bank-

only

$25,234,000,000

to

commercial
eral

■

of

Supply

investors. Government bond prices

in¬

from

1917

Money

and
City banks not only did not Prices.)
;
securities but ab- '
Thus, with the exception of the
sorbed some selling by out of town civil
War, the expansion of

debt

government

June, 1919. It is estimated that the

..

comparison

a

Debt,

8 3X

Pershing & Co., New York Cily, PresiJent of
National Association of Investors' Brokers,
says at least $200

sell government

declined

During the entire World War I

'Held

T

Milton Leeds of

York

not

■.

showing

selling

panic

no

of government securities. The New

of

Bank, stated that the banks should

-

Caused

64% above the

war were

statements level at the start of World War fl
reassurance that
in
December, 1941.
(See
chart

ident

■•*

after the

Uiirlt ftatla aI OahUaII PaJm*

nUllla HlgH BlulC Ul 0(ipiI<£B II&LEIS

meeting emerged

people. Gates W. McGarrah, Pres¬

'

UA|«|C

dealers, and savings bankers were'124%

11

The Commercial and Financial Chronicle...

(2636)

12

Thursday, December 31, 1953

If the

Industrial Atomic

question is whether or not
into
the
production
of
material, plastics, steel or
what not, it must be demonstrated
to

Energy

go

bomb

By DR. JOHN J. GREBE*

that

Director, Nuclear Research and Development
Dow Chemical Company

^

for expansion, even after
three-quarters of the income is

of

the Atomic

Energy Commission in spurring work already done

of "atomic heat reactors" is a
possibility for industry, but says question is one of costs,
which may be prohibitive in terms of today's technology. De¬
scribes research activities of the joint Detroit Edison-Dow
Reveals

Chemical project.

development, but

in

taxes.

use

in

the future
process

Advises against "government subsidy" in

out.

We

is

pleasant

to

business

the

and

ask,"

the

discuss

aspects

public

philosophy and natural resource
background which cause (1) pri¬
institu¬

vate

tions

eral,

(2)

power

for

ual

the

gifts

complex, but individ¬
and

can

should

free, independent inquiry into
natural phenomena and the laws
to

which

they

conform.

lieve,"

particular, and
specifically

the

The

sciences would wish

no

even

Company, to

search

interested

tions.

J.

Dr.
•

dif-

fers from

J.

end

Cireoe

first

part of this

ac¬

sub¬

is summarized in the

speech given
by Mr. Gorden Dean, then Chair¬
of

the

the

do

our

built the

basic

central

gov¬

in

and

progress

Atomic

should

be

in

done

atomic

the

leave

energy

research

by universities, individ¬
uals,. and private institutes, and
that

should

paid

for

be

not

by

controlled

the

or

government.

Those who contribute to the sup¬

Energy Com¬
mission, almost two years ago at
the University of Michigan Phoe¬

serving America."

nix Project. At that time private
.industry and the alumni were

said than this?

encouraged by Mr. Dean to back
.Independent atomic research.
At

that

occasion

Mr.

Dean

pointed out that the development
of atomic energy on its industrial
side is now in the main a govern¬
ment

monopoly.

But

he

stressed

security

of

port

Is

such

there

truly

to

be

pro¬

through

and

regula¬

to

pro¬
as

"a

armored

It

tive

in

nor

.free

atomic

Research,

energy

face with
scares

an

is. arrayed

coming face

dummy.
for the moment. It

you

in

the

finest

direct

can

capital.

coat

of

most

difficult

tasks

that

study

made

were

Mr.

Walker

by

President

with

new

that

of

as

is

its

known

for

method

converting

is

yet

of

energy

fissionable materials directly into

since

gene

M. Zuckert

turbed that
been

been

have

I
so

have

atomic

the

on

been

dis¬

secret in

1953.

*

-

*

*

the

main

*

the

McMahon" Act

purposes

to

was

of

make

this

new source of
energy indus¬
trially useful without jeopardizing
military
security.
It
is
well

known that any military develop¬
ment that does not become ah in¬

CORPORATION
A

aeronautics

new

the

development

accessories

and

Farmingdale,

An

N.

tompany

and

in

aircraft

lected, starved and underdevelop¬
ed to the point where its cost is

specializing

production

control

dustrial product becomes neg¬

systems.

of

Located

at

exorbitant

Y.

Original Stock Issue

Common

voting stock
$1.00

OFFERING

per

—

par

share

PRICE—$1.00

per

underwriting

contracts

commissions

no

involved.

Make

inquiry

value

directly

to:

share,
or

it

often

blossoms

too late to be a turning point or
significant factor in time of war.
If

we

are

protect

have

to

what

it

takes

industrially produc¬

an

purpose

of

killing.

offering
on'

hence,
come by

the

encouragement

given

by

Atomic

Century Controls Corp.

Energy Commission
and
their
top executives, both
publicly and in conference, has

Allen

spurred

Blvd., Farmingdale, N. Y.

which

us

has

been

Gentlemen:
some

Please

circular

send

a

copy

of your offering

to:

to

on

of the

do

done.

reasons

&

These

are

perative that industry and educa¬
an

increas¬

ing interest in this field.
An

Street

City

work

why it is im¬

tional institutions take
Name

the

State,.




industry

evaluation of

a

goes

sudden severe impact
of traditional

economy

This

fuels."

is

.

important

that
the

we

net

free

must
cost

be

concerned

economy

with

conditions

under

in

a

very

possible

new

prod¬

dispassionate

way.

which

and

*

the

be

con¬

it is to

indeed,

element

even
as

of

an

any

will

and

real

role

for

government

development
this

new

It

and

in

the

regulation

of

energy.

may seem surprising to you
this proposition needs to be

that

has

a

Only" and all the other atoms in

Your

efficient

asked hie tb di^6us$ "Admihistr'a-

with

of

they

military the

no

cannot

create

pleasure. There

a

Commission's

work, however,

because

out

for

plants
the long run.
You

are

built

reservation. This

was

the op¬

ask, portunity
to
participate in the
if atomic power is not commercial
forging of a relationship between
on
this basis now, what conbinagovernment
and
business
that
tion of power production methods would enable us best to realize
and reactor types is there which the benefits of atomic
energy in
may

might become commercial?
You may ask about direct solar
energy as

a

competitor. I

person¬

ally believe enough in solar heat¬

our
industry, our medicine, our
agriculture and in basic research.

Here

dous

was

presented

a

tremen¬

and

assist in

converted

at
even

100%

efficiency

It

seemed

clear

that

a

new

be enough to con¬

quantitative and qualitative re¬
hand, the lationship had to be developed.
combination of solar heating, the
There was, of course, the histori¬
Telkes storage system also using cal
fact that control
of atomic
the compression heating cycle by
energy
had been a government
reverse
refrigeration
with
off- monopoly from the moment it
peak power may yet substitute for seemed possible that its applica¬
gas and oil heat.
We should be tion would leap from the labora¬
using it now for our hot water tory of the scientist to become a
storage heaters.
decisive factor on a world battle¬
trol

it.

On

the

other

many

pet

schemes

with

way

cost

analysis and pushed back the fogs
COTltlTlllCd

r,0

OJl

field. This

prt^fC 32.

•An

happened.

address

'

Zuckert at the
58th
Congress
of American
Industry,
sponsored by the National Manufacturers
Association, New York City, Dec. 4, 1953.
by

Mr.

"For

box
•

with

Private

Limits

for

second

box,

big sign on

a

Use

Only—Off

Government.'V«*!This

it

is

said;-should be

almost

exclusively the domain of
private industry so that the vigor

of

competitive

our

exercise

system

may

its full force.

For a number of reasons, this is
just not realistic. I have given the

primary reason. The dual poten¬
tiality
of
fissionable
material

makes it impossible to employ a
of
laissez-faire
philosophy
in
the
aspect of
development of its civilian use.

to which I did look forward with¬

power

second

it:

feeling

was one

emergency or government demand

i

uct

I effort

energy

in

disarmament plan — there
should be inevitably a

world

Committee

dency.

to

Having cleared out of the

about * the

and:?do

say

way

extensively used, thus

no

the

would not

The

to

I do so to dispose of—or
atomic been a
great tendency to neglect at least
squarely join issue witiji
of the useful
exploitation of the tre¬ —a
type of thinking that mani¬
heat
engines.
Progress
toward mendous
quantity of vital infor¬ fests itself from time to time. This
lower
costs
will
be
made, but mation which can be discussed
thinking is to the effect that it is
presently scheduled conventional without
any danger to our securi¬ somehow
possible to put #11 of the
power plants will serve their eco¬
ty., Meetings like these are fine atoms needed for defense into one
nomic life before nuclear reactor
antidotes for this deplorable ten¬
box labeled "For Government Use
power;

continuing challenge to
proving that our Ameri¬
tive, growing, and successful peo¬ ing to be spending some of my
can system was indeed
own
a resilient
money on the developments
ple, atomic energy must be for
But there and
dynamic force. There was
human good, backed by an indus¬ of Dr. Telkes at M.I.T.
is
a
big
difference between
a pioneering to be done; new roads
trially useful and tax-paying po¬
solar house and a power house. to action to be bulldozed through
tential—rather than a purely mili¬
All the solar energy intercepted the technical wilderness created
tary weapon to be utilized and
by an airplane above the clouds by the complexities of the atom.
developed for the
to

300,000 Shares

and

♦

stated.

1

of

lot

a

indispensable

has

mail

One

resource

energy,

important—and

There

program.

the, tiVe 'Problems Invblved in Indus¬
with a battle axe in handpower producing and using indus¬
trial Participation.''^i I
hope you
but
when
you
realize
its
im- try.
You can see from this that will
indulge me for one moment
potency your next reaction is to even if atomic power were
a
of
my
20 for a personal note
blow smoke into its face to dem-^
present reality, it would replace
which ties into this assignment.
onstrate your lack of respect. Not
only 10-15% of the present utility
When President Truman asked
for
additional
fundamental
re¬
only Americans, but the whole investment. Even with zero fuel
me to serve on the Commission, I
search.
"There
are
some
who world can smell the smoke blown
cost, the maximum savings would was
quite naturally awed by the
into our faces from Korea.
be
less
than
0.4
cent
;
'An address by Dr. Grebe before the
per
kw. national
defense responsibilities of
58th
hour.
Congress
of
American
Industry
the
Main Purpose of McMahon Act
agency.
These constitute
a
sponsored by the National Association of
You can readily see from this burden to be borne
Manufacturers, New York City, Dec. 4,
resolutely but

inquiry, seeking, policies
Jand practices that will best guide
;,the public and private use of
atomic energy."
He
also
emphasized the need

fissionable

if they are to be controlled

much attention has

focused on what is

the

weapon

ducted. So long as atomic weapons
are

I

Commission,

have

manner

in

energy.

Ever

Thus

be

can

a

essential

an

atomic

atomic

Con¬

58th

is

about the direction of the national

this

Edison

is

which

power

we
can see
into the future, it
quite clear that the government

must

for

symposium

for

in

fis¬

therefore,
we start with an
underlying major,
premise that automatically elimi¬
nates a lot of
theorizing/ So far

Man¬

including

material

With

Associ¬

ufacturers

exists
same

be used in the national interest.

gra

of

world

destruction.

material

Company, in his report recently gress of A/herican Industry. It is a
published in "Chemical Engineer¬ material contribution to the es¬
ing News." It states that "atomic sential
public discussion of some
heat reactors are a possibility for
significant facets of the future of
industry — at least on a small atomic

No

of

con¬

for our national defense and must

the Na¬

ation

this

as

half-peace, the

of

missiorr-cgre
to

long

troubled

harnessed

energy. In this

Cisler,

Cost, however, would be
prohibitive in terms of today's

is

energy

sionable

concern¬

of

source

L.

scale.

atomic

so

is

leadership in education
ing this great

Detroit

the

of

the

summarized

Edison

Detroit

well

has

Dow

of

consideration

any

of

ditioned by this basic fact: at least

Commission

indeed

conclusions

first

The

today

use

Energy

ful

of Costs

Question

the

in the broad charter of the Atomic

tional

The

are

us

tions mpst not bar private initia¬

"necessary

industry

an

venture

plants

leave

soon

made

Imagine going
museum,
suddenly

a

into which
its

must still

are

the

can say there is
field, we must .'
the cards that looks rely on the ef¬
good enough to raise the ante so forts of others
we
will drop this particular ap¬
as much
as
proach to the problem. After all,
own.
We
there are many alternative patj
of-' the. Com-•

power

military

of

Industry

electric

turning around

that

tions.

So
One

nothing'in

great

in armor."

corpse

techniques known during
the
emergencies without
being
limited, by
economic considera¬
sound

that

unless

com¬

when calling for

military,

made

developments

would

gram

same

to

must go ahead by the most

Eisenhower

conventional

our

needs

On the

statement

scientific

are

want

not

any

technology.

that

more

General

gram

the

research

do
on

re¬

different

very

The
more,

completely

would

so

or

people.
In
short, there is much that can and

ject—that relating to the general
interest of private enterprises —

man

of

To

slow
a

us

,.

■

previous plans and

The

hands

re¬

put all

of

field

any

ernment.

atomic energy.
Our
present

approach

the

in

of

in

to

part

be¬

on

cherishes

that have

major

a

who

; one

traditions

Chemical

"I

he,declared, "that

flection

Dow

in the field

broaden

of

dustries in

be

the

the scope and stimulate the spirit

pro¬

ducing and
consuming in-

•

doesn't

He said the complete

answers are

gen¬

"why

finance all re¬
on
atomic energy?
Why
private funds to support

search

ask

said,

treasury

such work?"

in¬

and

dustry in

he

progress.
Points out self-financed
private studies of economic feasibility of nuclear power now
comprise six teams, participated in by 47 various concerns.

its

limited objective
requiring continued subsidy or
military demand.
promise

It

it has reached

expected full development is ruled

private atomic research.
general

good job of speeding atomic

that cannot meet this
when

condition

mobile reactors.

for

warns

dangerous, since "we know so little of what is ahead." Asserts,
however, that Atomic Energy Commission, if given leeway,
will do a good job of administration and
industry will do a

that may be necessary

A

greater share in nuclear

a

this must be of "an interim character,"
because attempts to be too specific or too forward would be

power

trated fuel

legislation amending the Atomic Energy Act, Mr.

Zuckert advocates giving industry

production and should
carry about half of the total cost
of operation.
This is based on
the
expected
value of concen¬

izing military security, and applauds encouragement given by

along these lines.

In discussing

of

industrially useful without jeopard¬

energy

Member, Atomic Energy Commission

So, our approach
has been that plutonium or U-233
should be considered by-products
paid

Development

By EUGENE M. ZUCKERT*

allow

pects of private use of atomic energy in both power and indus¬
trial fields. Says a main purpose of McMahon Act was to make
source

Share in Nuclear

steady market for

a

product at a price that will
permit a net profit sufficient to

Specialist in nuclear research discusses general business as¬

new

is

the
&'

this

there

Industry Should Have Greater

Conversely, this does not mean the
perpetuation of unlimited govern¬
ment

control

atomic
the

task

In

of

these

effective
two

tremes is the administrative
that

lem

will

face

the

of

then,

essence,

steering an

between

course

future

the

of

energy.

ex¬

prob¬

Atomic

Energy Commission and the seg¬
ments of industry Which will take
part in the development of atomic
energy.
II

The nature of these joint prob¬
lems

will,

of

course,

depend

di¬

rectly upon the type of legislation
Congress gives us as the tool for
permitting more and different in¬
dustrial
participation. Congress¬
man

to

Van Zandt has
some

you

in

volved

ably indicated
of the problems in¬
framing of
the

the

legislation. Let

try to give a
administra¬
to some facts
shape this legisla¬
me

quick summary of
tive

point of view

which
tion.
As

should

•

a

result of the Commission's

inquiries and
ings

an

as

so

ably

the thorough hear¬

conducted

by

the

Joint Congressional

Committee on

Atomic

conclude

the

Energy,

legislation

I

should

seek

that

to

'

Volume 178

provide

period

Number 5286

platform for

a

-y

how

sure

really

we

Plan Public

are

going

are

we

From

to

of the

chain

reaction

to

con¬

Every day we learn of increasing
applications of atomic energy. But
achievements

the scale that

on

hope and dream

there must

materialize only through years of

painstaking
and
expensive
ex¬
plorations into these new frontier
lands

science.

of

before the

!

First

constitute

dustry

commitment

a

that

if

it

which

this

into

gets

the

ahead is not
not

be

too

But

.

it

ample,

that

industry

will

permit equitable

matter

a

was

again
share

of

by the government in facilities

be

its

as

established

are

national

from

know

time

a

little

so

At this

attempts

at

specific

moment,

is

see

have

we

no

for long-term judgment as

matters there is bound to

basis

to the

it is

depend on the. knowhow bought
by the investments to date of pub¬

have

For

'

-

<

slip

rGfv':

;

damage to the

same

which-we

competi¬
trying

are

•

bring into atomic energy de¬
velopment. As you well know, the v
development to date, has been ac¬
complished largely; by industrial
contractors—many of them mem-

cent

:

^

the

to

be

In

the

A

in the
an

less

ing the peacetime

the

to

we

policy

very

is

why

I

necessity

off 50

of atomic

sands

charged

recognized. Let

government
equipped

with

with
insure

on

that

the

there

men.

of

is

to

grams

before they

are

our

Continued

on page




33

Peninsula,

It

that

City,

Ogden

associated

across

Edwards

with

has

become

sales

the

depart-

ment of the firm in its New York

to a
point near St. office. Mr. Edwards was formerly
distance of nearly five manager of the institutional demiles. The bridge structure itself partment for Van Alstyne, Noel &
will be approximately four miles q0
"f
long with a main suspension span
3.800 feet long, a side span on ei¬
ther side 1,800 feet long, and truss
Joins A. M. Kidder & Co.
spans.
Present designs for ■ the
(Special to The Financial Chronicle!
'
bridge call for a four-lane struc¬
ST. PETERSBURG, Fla. — Mrs.
ture

with

■

mg

a

V

barrier separat-

low

a

ii

a-

the traffic direct onaUy.

Elizabeth K..Dayton has become

Con- associated

with

^

M. -Kidder

&

'

foundations nsvc been
awarded
to Merritt-Chapman
&

bridge

Net

toll

Co., 400 Beach Drive, North, Mrs.
x

ta

-

f^wmnritr

...im

S

pieAik

^

& King, Libaire, Stout & for Bell
Co. and
prior thereto -was Cashier
&

Hough.

Elected Director
Adrian

of the bridge

revenues

Ralph

Kristeller,

,

'

Mejn-

durtog I958-—the first full year of her, New York Stock Exchange,
operation—are estimated at $5,- and George W. Tidd, retired^n.935,000; during 1975, by which gineer,iiave been elected director?
time the series A bonds may have "of Home Improvement Financing
been retired through operation of Corporation, it was announced.

To

the

Offer

not, an

of

Republic of El Salvador
Customs First Lien

bombs,

8% Sinking Fund Gold Bonds,
Scries A,

in fact, to have

the late

by

Holders

men

Dated

Senator

July 1, 1923, Due July 1, 1048;

l°/o Sinking Fund Gold Bonds, Scries C,

the Air Force

Dated July 1, 1923,

Due July 1, 1957; and

It is

a

economists

page

feeling of uneasiness

a

news

these days when

matter of national
and

statisticians

be

so.

prepare

recessions
I

think

and

about in

around

plant lays

a

import which sends thou¬
and

other

experts

to

their

profound statements and speeches

leveling

the first time

came

I

the

out
ever

term

It didn't

processes.

heard

to

of

a

recession

describe that thing

1938.

However, propaganda
around

issued with respect to

(Scrip Certificates)
Bonds of Series C,

and

Convertible Certificates lor
Fund Dollar

3°/o External Sinking

Bonds, Due January 1, 1976.

NOTICE OF EXTENSION
The time within which the Offer,

wise, this

Eisenhower nervous, presses

situation

makes

the crowd

the

above

1, 1954 to January 1, 1955.
The

uary

1, 1976, in

been extended,from

HAPPY NEYV YEAR

TO ALL!

July 1, 1955 to July 1, 1956.

Copies of the Offer may he obtained upon application to The
National City Bank of New York, Corporate Trust Department, 20 Exchange Place, New York 15, New York, the New.
York Agent

of the Fiscal Agent. Banco

El Salvador, San

Central de Reserva d^

Salvador, El Salvador, C. A.
REPUBLIC OF EL SALVADOR

By Enrique A. Porras

.

.*

3%
Jan¬
multiples of $100 principal amount, has also

period for exchange of Convertible Certificates for
Fund Dollar Bonds of the Republic, due

External Sinking

him into trying to do some-

ilwy glamorous such as calling' his program "dynamic" and when
thflcdngress dawdles away for weeks before getting to that pro¬
gram, the picture .that,.is presented makes hay for the Democrats.

dated April 26, 1946, to ex¬

Bondc and the appurtenant coupons for
Republic of El Salvador 4%, 3^2% and 3% External Sinking
Fund Dollar Bonds, due January 1, 1976, and to pay Certificates
of Deferred Interetl (Scriy Certificates) in cash at 15% of their
face amount, may he accepted, is hereby extended from January
change

.

when the New'Dealers used

f.**"
.

fewer

that the Administration is not going to

that

is
that

undertaken

Blair, Rollins & Co. Inc., 44 Wall
street, New York City, announce

I think there has been an improve¬

unquestionably

It is front

depressions,

used to

job

is
adequately
checks and bal¬
review of pro¬

ances

J; .jJ

on

means

seems,

flexibility

me assure you

and

Blair, Rollins & Co.

crossing of

Mackinac

labor-management relations because of the knowledge on

pencils and slide rules to

delegation of authority to the

agency

.

for

1984

and not try to furnish ground troops for the whole

was

the

1,

Straits

Ignace,

category should be placed the passing of the CIO as

same

But

stress

from

important accomplishment of the Administration, less

the country.

must draw the amendments so

that

which

fight their battles for them.

cognizance will be
taken of the importance of time
and the pioneering nature of the
That

Jan.

Ogden Edwards Joins

Upper and Lower Penin-

the forthcoming

that

energy,

and

men

long advocated

emphasis

put more

adjunct of the government.

:

uses

vehicular

Lower

after

prior to maturity.

less and less in

us

in

money

The Administration

the part of labor leaders

problems of this sort,
secondary to getting
„

of the Au-

Certificates of Deferred Interest

ment in

I hope, for the benefit of getting.,
on with the great job of develop¬

we

going to cost

are

much

"re¬

tangible, is the bringing of orderliness into the government, and

injustices.
of agencies exercising

■!

effort.

be

our

world.

and

answer.

redeemable

how

-

is

right

around

and the Navy

quasi-judicial functions, I'm sure
that procedural mechanisms, re¬
views and safeguards are entirely
urgency

will

by the draft.

Taft—that

recognize the merit, in dealing
government
agencies,
of
erecting checks and balances to

proper.

deemed

pro¬

This is

either that these "tensions" and

reduction in the number of

a

come

with

case

There

future.

called up

I

the

be escaped

seemingly knows

budget for the military than there was in the last; there is even

in
administering
the
government's
part of the participating partner¬
ship with industry.

In

have been

we

be

will

be retired in its

can

V

sponsibility towards the world"

Commission

mistakes

Administration

.

high degree of discretion to the

prevent

the Eisenhower

It can't

opinion, it is vital that

Energy

definitely stopped.

of relief from the world tensions in which

them in its stride.

to take

the legislation be flexible and give
Atomic

the United States is concerned it has

as

but

sions

competitive tradition

perpetuate the headstart which
has been given these companies as
a
necessary
part of the atomic
weapons
race.
There is another

my

book would be the stopping of the

my

until- the

wallowing, not that there still won't be the so-called world ten¬

to

In

in

one

the Administration's handling of this fiasco there seems to be

assurance

has required that their num¬

fundamental point:

Number

Mackinac;

bonds

•

In

ber be limited. It certainly would '
not be in the

sole

extend

the

the

are

to campaign. * The primaries in niany States come quite
TTtie Republican candidates will likely be affected by the

the

away

insofar

association. These '
done a magnifi¬

job. The nature of the pro-

gram

in

world of propa¬

a

probable

of

revenues

sulas of the State of Michigan.
will

We live in

of

projections
and

arate the

are in the end defeated.
them, would undoubtedly

bloodshed in Korea, and it is becoming increasingly^ apparent that

-

of

jn whole at the option

the Straits of Mackinac which sep¬

impatience towards Congress

an

the

be

they would like to have it accomplish. Before many weeks
passed, members of the House and Senators will begin to

its credit.

have

contractors

develop

not

tunnel,

B

home atmosphere that their Administration " hasn't accom¬
./ Scott Corp. and for the construe
plished anything and their tendency will be. to strike out and
tion. of the' bridge to American
campaign on their own, shedding: their Administration ties and
Bridge Division, U. S. Steel Corp.
joining in the criticism. Of course, this will all be right up the
The bridge, it is anticipated, will
Democrats' alley. • >
•
* >- ; > F
be opened to traffic/on Nov. 1,
The facts are that the Administration already has plenty to
1957.

to

bets'i oil this

the

back

•

-

tive system

attitudes

our

early.

•

example, freezing the patent

pattern now could result in seri¬
ous

talk;

apparently moulded by propaganda. The
propaganda will be that the Eisenhower' Administration isn't
accomplishing anything, with very few people knowing just what

degree that future discoveries will

lic funds.

endless

series

entirety by 1975.
The bridge, which will be fi¬
nanced by proceeds from the sale
of the series A and B bonds, will

disappointed, but that is about all.

ganda,

Straits

of

The
the

posed bridge,

that the people of the country will

and the Eisenhower Administration.

ahead.

issue

an

A bonds are accorded

over

neering

trying to make is that it seems a pity that a
Congress from which so much is expected, which has so much to
do, should have to start off in this way. Certainly none of the
three measures mentioned above will command any appreciable
degree of popular interest. As the weeks are consumed with these

we

17

Dec.

series

traffic

The point I am

be

to

when

what

of

and

time

any worse off if all three measures
The people of Hawaii, the more vocal of

a

arise

would
too

•

endless

consume

be

variety of pitfalls
which such legislation must avoid.
The most serious danger, I think,

a

will

boring and it is difficult to

the expensive develop¬
job will have to be carried

There

•

three

any

bonds thority or in part by lot for the
with respect to the payment of
sinking fund at prices ranging
interest and the retirement of the from 108%
pjus accrued interest,
bonds.
The series A issue, it is jf redeemed On or
prior to Jan. 1',
estimated on the basis of engi- 1904 to 101%
plus interest, if re¬

conform,

to

time

laboratories.

.

legislation

will

State

and

.

The

priority

good

this

of

such

-

domestic

the

operate

or

Inc. is

Co.,

not international treaties, have

-

All

on

on

Hawaiian statehood bill may be subjected to a filibuster, and tac¬
tics surrounding the consideration of the St. Lawrence bill may
smack of that. At least, the debate on all three will be tedious and

policy—and

brought out time and
in testimony—that a

mental
on

'

up.

amor¬

tization of its plant investment.
The legislation should recognize
as

settled; second
providing

resolution

the third will be the bill, already passed
Carlisle Bargeron
by the House, admitting Hawaii to statehood.
They may not be in that order but the indica¬
tions are they will be the first three pieces of legislation to come

be able to get fissionable material
from the government on a basis

that

Bricker

construct

bridge or ferry service which will
be competitive with the. authorized bridge, and so far as legally

Mackinac Bridge Au- bridge is placed in operation, howthority series B, 5V4% bridge rev- ever, the Michigan State Highway
enue bonds due Jan. 1, 1994; howDepartment may operate ferries
ever,, no
public offering of the between the Upper and Lower
series B bonds is planned at this Peninsulas.

been
will likely

more

that

enanted

under-

an

$20,000,000

already

and

industry that it will

assure

the

cally passed

borrow money upon its fixed
assets
in
a
normal
manner.
It

can

should

be

on

&

awarded

the

matters in treaty provisions
affecting domestic law, or in other words pro¬
viding that treaty provisions are not supreme
in domestic law unless Congress has specifi¬

provide, for ex¬
private ownership of
so

have

words

to

Stifel, possible, it will prohibit the conexpected struction or operation of any other
to
be
made about Jan.
14, the tunnel,
bridge or ferry service
group managers announced." The which
will afford facilities for
underwriting syndicate was also vehicular traffic to cross the

Nicolaus

■

..

be

17

Dec.

on

Incorporated,

pany,-

of the

-_

.

likely

Lawrence waterway

St.

of

' ;

will

calendar

which millions

on

that Congress,
the last word

embracing.

reactors

millions

item will

should

for

nuclear

the

the

writing group comprised of Union
Securities Corporation,
Allen &
Company, A. C. Allyn and Com-

be considered dynamic

dynamic program

reached.

be spoken before the matter is

technological road
clear, the law should

all

awarded

wind-bagging in the Senate on measures

way

even

on

spoken and

takes risks and gets results,
there will be profits to industry.

race,

Because

no

long-controverted

in¬

to

lot of

a

so-called

President's is

Certainly the legislation should

•

be

which could in

sinking fund, at $11,159,000;
and during 1993, at $16,703,000.
The State of Michigan has cov-

of $79,800,000
Authority 4%
bridge revenue bonds, series A,
due
Jan.
1,
1994
which
were
offering
Bridge

Mackinac

The cards seem to be stacked against President Eisenhower's
"dynamic" program getting off to any dynamic start when Con¬
gress meet next week. In the nature of things it looks as though

we

possible will

are

Public

of the News

By CARLISLE BARGERON

that there ARE dividends.

us

Offering of Mackinac Bridge
Authority 4% Series A Bonds About Jan. 14

Washington

Ahead

Enough has been accomplished in
the 11 years history of man's con¬
vince

13

'

interim

an

achieve the most significant bene¬
ficial
uses
of
atomic
energy.

trol

(2637)

The Commercial and Financial Chronicle

development.

of

Technologically,
not

...

heccmbcr 31, 1933

Minister of Finance and Public

Credit

.

J1'

14

the economic

strengthened,

The Canadian
President, Bank

Chief executive of large

menting

and international trade, says

Canadian domestic
situation is now one in which nor¬

Broadly,

it

adopting
has

been

expanding

another

activity.

it must also be said that the busi¬

landscape has begun to show

a

varied

more

pattern

been

of

light

Some

ent

seems

tify

culties.

Of

in

has

keener,

both

in

Gordon Reginald Ball

brief,
to

seem

have

passed

from

a

situation in which nearly all busi¬
ness
influences were buoyant to

which

in

the normal hazards

enterprise

parent.

once

are

more

ap¬

While

this certainly does
gloomy view of the
outlook, it does suggest the need
for a healthy awareness that boom

justify

a

conditions of easy

selling and easy
subsiding. I am stiil
optimist regarding
Canada's
future, but sensible optimism in¬
profits

are

an

cludes

candid

a

immediate

renewed

recognition

prospect

emphasis

the

of

free

world.

A

places

a

salesman¬

on

Flexible Monetary Policy

One

the

of

most

important de¬

velopments in the past two

years

has been the revival in many

countries of

greater

a

solid significance has
appreciable improvement

an

the economic

position of

many

use

tary
measures
to
support
and
supplant other forms of control.
Resulting betterment in external
position, stability of prices and
renewed

confidence

in

of offi¬

cial

monetary policy to stabilize
business and prices. This has been
as elsewhere. With
the central bank keeping a firm

national

currencies have combined to build

the

up

exchange

sterling

and

area

dollar-short

of

the

other

some

countries.

bal¬

But

has been achieved

ance

of

reserves

to

con¬

a

siderable extent by foregoing im¬
ports and thus restricting the flow
of world trade to

a

and

the

is

needed

United

ditional

the

level far below

desired.

Kingdom,

action has

direction

In

certain

been

and

too

often it is as¬
commercial pol¬

the

of

rest

when

the

ad¬
in

taken

of

flexibility. Step
by step, subsidies on consumption
are being reduced and the
weary¬
ing shackles of rationing thrown
off.
Trading in one basic com¬
modity after another is being re¬
stored to private hands and the
import licensing procedure has

fluence

only

icy

other nations. This is not
matter of commercial pol¬

a

in tariffs, quotas

as expressed

arid methods of customs adminis¬

imported

goods.

Canada has

vital and continu¬

a

States, not only because
predominant and
direct
stake in that
of

cause

of

in

and

pervasive influence

restraining excessive demands
might otherwise have led to

rity held

renewed

Britain

inflation.

levels of both
sumer

in

prices

As

it

is,

wholesale and

the
con¬

have

changed little
The nation has

interest-free

by

Canada
to
the
United Kingdom
in 1942.
Until
recently, when a Canadian secu¬

that

by

resident

a

sold

was

Great

of

redeemed

or

in

Canada, the seller was obliged to
accept sterling and surrender the

the great advantage of being
able to do business with a dollar

Canadian dollar proceeds to the
United Kingdom authorities to. be
applied against this loan/Now he

of

may

the

past year.

had

stable

purchasing

power,

and

increases in personal income have
meant
real
gains in the living

standards of Canadians.

switch

nadian

investment

from

U.

a

rity.

All

this has been to the good. I
hardly add, however, that a
heavy responsibility rests upon

freely from

He

S.

to

a

another,,

thus,

may

exercise his

to

own

Ca¬

one

Canadian

or

secu¬

again,

once

judgment in par¬

need

ticipating in the Canadian invest¬

national monetary authorities
to take care that their
policies are
not rigidly maintained

long favored.

point of usefulness. "Tight money"
makes good sense as a weapon to

Kingdom's

our

beyond the

combat

forces.
not

of

make

such

sense

declining

markets
of

underlying
But

and

manpower

a

prices,

conditions

contracting
sui pluses

emerging

productive

ca¬

pacity.

It requires a high degree
foresight and ski,ll to know how

of

long to keep the monetary brakes
on,

when and how much to relax

t.jem,

and

when

to

press

on

the

accelerator.
•An address

by Mr. Ball at the Annual
Meeting of Shareholders of the Bank of
Montreal, Montreal, Canada, Dec. 7, 1953.




field—a

field
And

that
to

he

the

has

extent

that there is switching from U.S. to
Canadian obligations, the United

investment
stake
this country will be enlarged.

export

market, but also be¬
dependence

our

on-the

ability of other countries to
U.

dollars

S.

ports.'

Over

in

Canada

as

with

their

own

ex¬

long run, as far
concerned, we can

is

reasonably confident that sheer
economic logic will be on the side
of

expanding

an

flow

of

trade

with

the United States.

We

vast

storehouse

of

To

revert

will

increasingly

demand

come
some

as

raw

are

a

show

is

of the basic nat¬

signs of depletion.

long-run concept.

a

in the

est

immediate

But that

Our inter¬
future is in

the

speedy furtherance of trade
policies based fundamentally on

recognition of three facts: Firstly,
that the welfare of the free na¬

a

be

can

full

two-way

that

achieved

realization

it is

designed

to

countries

to

have
cent

tial

themselves

regard,

welcomed

great

the free

world

a

opportunity for further bold

advances towards closer and freer

being.

One

and

nomic

use

of resources.

It

would

be tragic if, just at the time when
the military and political defenses
of nations of goodwill were
being

Canada

number

of

re¬

influen¬

by

of. the .most

impor¬

striking of these

was

a

report submitted to President Ei¬
senhower bv Mr. Lewis W. Doug¬
las

questions of U. S. trade and

on

as

report
the

related to( sterling.
highlights the view

United

world's
pursue

the

States,

greatest

in

other

•

trade

cannot

policies

and

hope to
and

the

as

creditor,

of

a

escape

discrimina¬

American

markets.

While

products
the

re¬

port recognizes that maior changes
in tariff policy will take
time, it
recommends

eco¬

in

: ^

•

basic principles of economic welltant

ernment

and

>

reflecting high-level
opinion, and all, in one
way or another, implying recog¬
nition. and acceptance of these

wards

intensive

r

business

trading relationships and thus to¬
more

:

American'indiviciuats and or¬

against

for

we

a

restrictions

presents

bv

ganizations,

tions

year

>

pronouncements

from

international trade and finance

fortunate

fair chance to sell

of

the countries of

dence

narrower

cor-

d

wou

ahead.

under

onlv
only

ude

cone

factors,

are

how-

with

&

confi¬

readjustment

will

nouncement

work

that

make
of

towards

the
a

U.

S.

Gov¬

prompt

determination

simplified

Continued

an¬

to

customs

on*page 33

|n

as

its

stable

"a

not

role

and

omy," has for
taking

steps

get

now

out

of

of

the

money

to

pinch

of

see

econ-

to

its

securi-

in

prospect

the

spring
.

has

building,
there

will

inventories,

of

mean

to

corpo-

»

fu^

when

business

people tend to save
converseiyi they spend

down>
Qr

lar§er proportion of their aggregate income- That is likely to

happen

in

1954? just

saved

their

reduce

that

g%>

would

me£m

some

$3

billion

con-

of

7.3%

income;

sh0ldd

of

year,

roughly

spendable

if

they

proportion to

the

trans£er

from the

sav¬

ings to the spending column.
It is

largely for this

expect

total

reason

level.

goods, such

Purchases
as

of

/

that

spend-

consumer

ing to approximate the 1953
0rd

■

it did in

as

During the past

rec-

durable

*

automobiles, doubt-1

less will be down, but

spending

for'

services (travel, medical attention,,

rent,
hsh

will

etc.)
a

new

estab-

probably

high record,

About Like 1952
Balancing all factors, favorable
and

unfavorable,

is that
will

be

only

also

suggests

little

dumping

calling
are

of

usu-

would

our

conclusion

production

1954

5%

than that of 1953.

as

will

billion

tion

be

receivables, etc., such

$2

primarily

but

hasty

elimination

taxes

important

implications

that

the

,

Savi

assured

repetition of

stringency that began

business

for

Vz %

require¬

well

no

credit

.

favorable

of

reserve

be

can

1953.
This

largely

government

ties and reduced

that 1954 will

the

ease

Thanks

of

months been

some

to

purchases

we

guardian

as

expanding

situation.

ments,

,

that the
increase in social

1953

(3)

we

in

furfrom

limiting the decline tin
their net profits.
Indeed, we be]ieve that they will be able to
pay fuiiy as much in
dividends

sumers

(1) Credit: The Federal Reserve,

this

information

suggests

than

re¬

Standard

1954

the

way

best

a

There

at

us

face

that

later,

voted

rations,

]ess

considered
considered

offsetting

to

re¬

taxa¬

be strengthened

profits

excess

hand:

measures

help
a

external markets.
this

is

thirdly,

less

debtor nation

during the past

and

help

giving them
In

with

trade

talk of enduring

to

without deliberate

peace

in

only

that

process:

idle

that

main

Poor's

into

ural resources of the United States

theme,
the real measure of
improvement
that has taken place in the
sphere
my

Schmurz

a.

more

causing

ever,

Our

Similarly,
Charles

he

lay

decline
double

security taxes will be rescinded.

really serious business

cession

in

employment.

from

is

taxes

scheduled

ohserver
observer

several

Jan.

billion

consumers,

lower

relief

Washington

suggests

forces,
a

one.

effective

to $3

income

from

some

ther.

piofit margins.

these

read-

going
toward offsetting the

cushion will

Offsetting Factors

that

taxes

of

way

gains

,

the
the

this

orderly

an

tion of dividends and from capital

spending for
plant
and

Tf
11

pockets

long

If

indus'r'al

pora.c

be

put close

sulting

materials

that

This

Opportunity to Be Seized
to

in

will

prospective

declining

be

currency

An

a

earn

the

I

inflationary
policy would

under

and

ment

spending

our

loan

powerful

ment

ing concern with tariff policy and
the pace of business in the United

upward

made

V

correction,

standpoint,

income

1, will

Govern¬

petition

the

a

busi-

a

business

a

that

justment

the

Perhaps of even greater e q u i pment.
the repercussions, in Employment has begun to conother countries, of marked swings tract and, together with a reduced
in business activity in the United amount of overtime pay, points to
States with their consequent ef¬ a
fair-sized
shrinkage
in
total
fects on that country's demand for consumer income. Increased com-

aid"

been

of

1953.

in

From

sonal

on

are

the

has

went
most

in

tration.

moment

of arrangements for repayment of

movement

that

the level of prosperity- g e s t- a ';-4%
d e c 1 i n* e

on

in many

market interest rates have tended
rise. This general and flexible

the

Drop

(2) Taxes: The 10% cut in per¬

said concerning the proper
permitting, is
responsibilities of soft currency, likely to drop
further in the
countries, the fact remaipSi
the course of affairs in the Umted: corning year.
States exerts an overwhelming in¬
Surveys sug-

lationships has been the revision
of

some

been

tions is inter-dependent; secondly,
that the objective of "trade not

particularly welcome move
Anglo-Canadian financial re¬

balance

.

ally associated with credit strin-

Inven-.gency

and

and, Russia

supply and
with the demand for credit
active,

A

skies.

large

accumulation

has

said

in

to

*

I

A. SCIIMUTZ

the

replace

be

that should

all

too

are

is

rein

money

industrial

But

been relaxed.

the

4

>■

•

offsetting factors to indications of

as

plenty of dark clouds

are

the

world.

free

true in Canada

on

r

travel, medical attention, and rent, etc. to bolster business.

.

There

„

cur¬

brought to heel by steadily ex¬
panding production and, as I have
already noted, by the use of mone¬

what

that

ship, efficiency and sober realism.

or so

effort

rency group. In a number of cases
the forces of inflation have been

do¬

terna tiona 1

trade. In

the

per¬

countries in the so-called soft

mestic and in¬

not

assurance of

more

been

Com¬

petition

of

There

seen.

security that would jus-,
marked reduction in the

any

defense

diffi¬

been

one

or

encoun¬

tering

we

yet no

as

manent

export

marketlf^nave
been

break in the weather

a

squall remains to be

depend¬

on

There has

the deceptive calm before another

particularly

today being
United
States
of

the

America,

easing of international

some

tokens

indust ries,
those

Much free advice is
tendered

tension, although whether that be¬

and

shade.

been

welcome developments.

l

Cushioning

inventory correction will probably

the year has icy is the sole factor determining
a
number of the
prosperity, or otherwise, of

abroad,
featured
by

*

slump: (1) prospect of easier credit conditions; (2) some
reduction in taxes; and more spending of income
by consum¬
ers.
Looks for larger consumer spending for
services, such as

on

The Role of the United States

sumed that U. S.

Looking

Mr. Schmutz lists

tories

Recovery Abroad

But

t

ness

high tariffs and in ten-

restrictions.

sified

liberal and unrestricted trade policy.

a

*

I

President, Standard & Poor's Corporation

drive

should

over-production

ricades of

Finds U. S. policies and
dominant world influence, and stresses necessity

a

of U. S.

ness

of

/

•

individual nations behind the bar¬

should drive

be expected.

can

'

19S4 Business

the present day.
And- that chal¬
lenge will not be met if the bogey

Sees, how¬

high tariff barricades and exchange restrictions,

periods of slump
conditions

if bogey of overproduction

warns,

nations behind

of

com¬

improvement in the sphere of international finance and

trade, but

'

By CHARLES

rightly believe produces most and
contributes
most
fully to wellbeing does not inevitably beget
periods of slump and mass unem¬
ployment. That, as I see it, is the
great and immediate challenge of

of Montreal, Canada

mal hazards of enterprise are once more apparent.

'

terprise, to demonstrate here and
now
that
the
system
that we

Landscape

return to keener competition in

on

*

Some Forces

past were to be lost.is up to all of us, in all coun-'
tries, who stand with private en¬
It

Canadian banking institution, in

'

gains

of the recent

By GORDON R. BALL*

? ear

*

'

A More Varied Pattern in

ever,

Commercial and Financial Chronicle... Thursday, December 31.4953

The

(2638)

Such

suggest

an

goods

of

lower"

10%

to

projec->

a

average-;

level approximating that of

1951

and

like

1952,

which

extraordinarily good
time.

seemed
years
4

at the

Volume 178

D

Number 5286

■

...

V

The Commercial and Financial Chronicle

1/1

H

Hlf

1

■

■

ent economic situation.

J

1S11S1I1ASS ■iWwv* LfkVI 1#V AT Alt 1 Aft
LP VP I Villi BP IVlAlfltAlflPn
IUImvIA

tive,

and not
to

nesses

The

Says continued government spend-

tinue to

spend, and

future

must

to

less,

the

keep

off

depends

nation
forces
tors

busi-

sales and

in ..mind

the

trol

In

of

man¬

as

"within"

o u

t

i d

s

forces

v

is now

to

;

stater-,

as

under way.

economic

to accomplish this end. Con-

gress

rather than restrictive tone.
is

There

lie ahead,

inadequacy of

-

good

even

reason

non-defense

pre-

no

con-

laid

plans

to

resist

adjustments.

executives of

individual

business

organizations with which I
contact.

of

Most
are

the

in

am

"bears"

in

working like "beav-

to

often

too

allow

ahead with
than they now

If

a'

js

for

yery

must not be deluded, howinto thinking that economic
rabbits can always be pulled out
of Uncle Sam's top hat. Govern-

a

jn

our

themselves, this can only mean
that they expect their own gains
will come at the expense of com-,

are

much

ing

force,

a

brake

ordinarily

powers

effective in plac-

more

expansion than
dragging econ-

upon

in

incessant drive to antici-

pate economic trouble—so

most order backlogs
definitely shrinking, industrial
production has fallen 5%
since

be

prepared

to

minimize

we

omy.

can

for it—typically

the

<m

_

m6fi customer requirements, (2)

methods

costs, and personnel, (3)
financial and credit policies, and
(4)
lone-ranee
nlans.
We
will
(4)
long-range plans.
We
will

pretation
set

here,

expressed

trouble foreseen,

nation

the

is

on

We fear sudden

.

ot business confidently look for- too often we speak in generalword to higher sales during 1954- ities about "government," "busioffsetting to some degree at

The

kev

statistic

Ti

u

whether

or

wmcn

recession

tells

tens
is

of-

much

so

east ness," "labor." and "agriculture,"

declines

impending

receiving

now

which

"C

not

with

press

"prices
and "credit
when what
we really are referring to are peo-.

coverage. In short, the economic pie—their likes and dislikes—and
•

•

weaknes5?

t

and

ahnvp

aii

tions.

How people

Herisinns

and

ar-

nor]?on is not an weakness, ana above all, tneir decisions and ac
cautious
still

optimism

looks

petitors.

Not all can succeed at1
this game. The going will be
"rough" for organizations with.
weak
plans
and
short-sighted
managements. But it's highly encouraging to know that the pros¬
ent attitude in businesSfJs to ex-;
pect some

shocks

next

but

year,

to "come out swinging" to meet *
them. As a result, the forecasting
paradox mentioned at the outset
stands a good chancq, of being re—
solved in favor of

higher level

a

0f general business than now
commonly forecast because of the
cumulative effect of actions of ag¬

gressive individual company man-,
agements
everywhere
to
do
a,
better

^

nrvm

The Key "Statistic"

me

_

.

those

several forces which will impinge

the sales financing business

.

all.time record.

„ew

quick look at these

in the year ahead.

„

,

given currently to any
development which fails

business
t0

_-a.

_

Naturally, if" business leaders
now forecasting "trouble"
in

their industries and the business
community generally, but less for

stimulating a
Government economic action
we
also takes a good deal of time—
<bave not taken into acc0unt many usually several weeks or months
few readings from economic
counterbalancing actions designed at least. If, contrary to the views
where

•

ment's economic

economic

powerful

concerned,
are

We

in forecasting we

fully

strong prospect for

ever,

momentum, which we should now
^now

a

1954.

•

to

despite tax

purposes,

reductions, is

able

___

upon

across

by

I find little defeatist thinking toward the year ahead among the

business

n.

a

accompanied

siderable

believe from recent developments

years

confidence

All

our

measures.

At

year.

managements

5-10

/

faji

are

reck¬

want to take

difficulty.

pro.-

gram

may now

single

a

plan

can.

barometers:

which
be

is

is

js bard at

Expan-

Sales

a competent
work designing a

changes, but his- the brink of a sharp recession, any
toryi fells-us most changes are corrective program short of a
oned
with
in
March,
unemployment
remains
fairly ' gradual. In my view too drastic
tax
reduction
already
judging the
near the all-time
low, but is edg- rnajw
people now know about the would seem late. Nevertheless, on
future
are:
ing upward, overtime is rapidly "standard" forecast and
W. E. Hoadley, Jr.
are takbalance cautious optimism toward
(1) the course
disappearing, new homebuilding
ing steps to hedge'against it for business prospects over the year
of
general business which in
hrmH
is
but total construction the preciseiy predicted pattern of a.h?ad looks pretty solid on pobroad sense includes
many more
continues at a record pace, the
<=
in<»
rwiinp tn nornr
litical grounds,
specif*' "outside" factors, such as st0ck market shows signs of re- 3 5-1°% decline to occur.
(a) the policies of government, and newed
Psychological Factors in
strength, money rates have
discussing many optimistic
(b) of dominating importance— cased ficncral nriccs remain firm
Forecasting
company
forecasts for 1954, as
the buying potential and spending
andiwrali consumerspending mentioned earlier, I've been imAny forecaster is on pretty thin
attitudes of the consuming public;
continues at unprecedented Pressed by the extensive research |ce when he tries to incorporate
and (2) the policies and practices
heights. Earlier this year these and elaborate'merchandising plans psychological factors in his preof competitors. The principal "inconditions could be described as behind most of them. These fore- dictions, but without some allowside" factors which management
"seething stability"—now perhaps ^asts typically are much mor£ ance for the attitudes of individcan
shape substantially include:
"dynamic doldrums" would be bet- J!1311 ^ales manager s annual edi- uais, any forecast is incomplete
HI nrnHiirt
firm of dreams. Tn fact .manv lines
lo
liirmivr
Ko
i,-.
All
(1) product anH service nnlipipc tn ter to reflect the «bearish»
and cptoipp policies to
inter- tier.of dreams. In fact many lines and
likely to be in error. All
must

serious

Most of the caution I detect

business

it

over-

underlying confidence,
staff which, in turn is based upon well

sales, despite tempo-

business

more

busi-

are—it's that much tougher to
know where we're going.
Here

we

it are

"

e

flat

precisely

of

principal

c'

without

come

downturn, and

_

vious time in history were Amer-

very Jean

that a.broad

national^ statistical
we
don't know

the

management.
The

the

quarters
made

is

the general

on
.

influence

another

time in

Frankly, the statistics are not
clear, which is a sad commentary

those

as

is

recession

ness

con¬

.

well

profit potential close to
just passed.

many

ment

"out¬

agement

year

con¬

commonly used word these days.

of

the

which
confidently expected will be

ers" to insure that their own com¬
panies will fare better than their
population experts tell me »jn the money markets that the Ad- industry and business generally,
that there is an excellent chance ministration
already
has taken If the "bears" were acting like
that 1953 will witness the largest
:steps to resist downward pressures "groundhogs" — afraid
of their
number of births on record—just in the
economy.
Heavy govern- shadows and heading back into
about four million for the first ment
spending for defense and their holes — I'd be much more

ment such

living standards

"Recession"

combi-

a

in position to

now

to maintain

so as

fac¬

or

—

side"

upon

in

leaders have announced for
months that
they will move aggressively to retard an economic

will

periods of economic adjust-

rary

,■

general business turn¬

a

family is

that the success of
any individual
company

_

underlying

irt output and

to resist downward economic

stave

average

save

Attempts, to. forecast
ness

which
1954.

Long-Run

of

basic

many

are no longer
Top Administration

The

will do much

down, and points out

_

practicable.

is certain to get a substantial
growth trend in population and .legislative program from the Adaccompanying rising living stand- ministration in January, which
ards point to longer-run expansion should have an over-all expansive

,

pressures

.

sion

Asserting business volume during 1954 can be held to 1953 <
level, despile predictions of a recession, Dr. Hoadley holds
greatest single challenge to business, in year ahead, is to
convert, through aggressive merchandising, consumer buying.

the

strength

.

Portending

Economist, Armstrong Cork Company

potential into actual sales.

of

policies

nomic

perspec- *

these weak-

business in

support
_

allow

obscure

elements

By WALTER E. HOADLEY, Jr.*

ing and Administration's actions

But we total spending, that "neutral" eco- pending adjustment

must keep our economic

By Aggressive Merchandising

15

(2639)

job than their competitors.

Recession

readily

from

far

dinner

talk, which developsalmost

in

conversation
a

discussion
discussion

families
iamines.

cjudjne

some

amoim

among

.

According
/Accuiuing

to
iu

surveys
surveys,

in—
in—

well regarded
regarded

many

»

days, is still
frequent subject for

lamp
table

American
American

business

any

these

made

bv

our

own

comnalv The tvnical AmerS
"®t anUcipatiTg
ramiiy is not anticipating eco
eco-

noniic distress and at present does

fears of

^ot share the recession
The

business.

■...

,

public

for¬

looks

confidenCG

to

further

feel and what
they do will determine more than

ward witn connaence to iurtner
gams in living standards next

anything else what actually hap-

year. Stable or slightly declining

fended on political gr o u nd s?' Pens to general business.and sales
Rather easily, I believe. No busi- financing business in the year
rially what happens to this busi-J
signals trouble.
Over the past ness forecaster who expects to ahead.
ness during the next 12 months.
three months, a very slight down- remain employed
for long can
**s J1.0 secret that a good deal

P"ces
stof of betted
many lamiiiea1 as1 signs ot better

First,

let's

reach

your

consider

which

ments

ficially

are

developlargely beyond

management

as

execu-

tives, but which will affect mate-

here

is

income
after
taxes,
particularly
as
linked to consumer spending.
A
noticeable drop (i^., 2% or more)
in
"disposable
income"
clearly
personal

sound to

Can

me

on

cautious

economic grounds,

optimism

be

de-

" w

;

f

.

,

.

We must, of course, recognize

'

business" understand-

ward drift in after tax income has

ignore what government adminis-

has crept into business that because the public still has

seems a pretty vague expression to people who are concerned
with a very specific type of busi-

taken place, but no pronounced de-

ness—in this case, sales

taxes

trators—local, state, and Federal
—will be doing during the forecast
period. Over the past 20 years a
profund change has taken place in
what the public has come to expect from government and what
government
apparently feels it
must do for the public along economic lines. As a result, it seems

thinking in recent months, and es- a good deal of confidence in fu¬
PCdally since mid-year. T he ture economic conditions, there is
latest
rtune suiv y o:f busi- always the possibility of some
"G?^ ™
nn^?m?sts thrpp to
ra
sudden change for th^
h_.7'
a sharp impact upon

"General

ably

Yet,

financing,

a comparison of activity in.
industry with that of business

this

generally

shows

that

despite

a

record of spectacular growth, your

and downs have been closely

ups

related

to

fnf of
mg,

couise,

period

when

ables'
in

the

were

supply

the

TTufkiaTrestricted
forecast

oiTO

hold,
a

Zp li^

next

If

standard

past

six

weeks

describe
to

views—seems

my

psychological
forecast

way

I

sound

economic, political and

on

me

away,

*

optimism—the

can

grounds.
meet

this

Cautious

Unless

a

three-fold

vol-

forecast

sharper contraction

only*reasonable to anticipate

now

Let's con- thatbe "little" recession may prove
a
to
a
very

is sound

optimism

on

because

of

inflationary

government

force

Such

vou

pesstedstic to

p0rtant election year, with control

this

1C

is

s>iue.

hpransn

decline
eral

less

business

months.

it,

of

T'm

iNU

uuuui

antinirta + ina

than
over

5%

the

a

manv

vv"^"

pXts^nallmfnte!

will

still

offer

aeilianus

nrvf

nloov

is

nut,

following

rather

for

have

conserva

e Dolicies nartlcularlv
iJ^erSories^ and costs
t-

toward

byylng'
' a^ther wa^5
0^ scarebuying is possible, touched
1? S+°me ne^Lcrlsls and ^
of shorta^es- Thase seem to bef
GXtrGme P°sslblllties' hawever.

world

War

TT

the

*

PubUc,s Spending Attitudes

wiHclv

most

•

K

For the first time since the end

recession for months and

rr<u

t

a

Americanxubhc

are

pub-

hist0rv

turn in any economic baiometers.

An

currently reflect
incomes

making

adour
has

generation

entire

It's

wage-earners

Business adjustments can hardly
come as a surprise now. Why

h^many

more

h

same

shouldn't business executives be

cautious??
Furthermore, it s difficult to
why this sentiment should change
abruptly. Aside from some dpremnfp
"rrisis"
most

our

firm

Moreover>

m

£

th/

generations can
good
fortune./,

memories of war a, cT
postwar Conditions plus continasee
international
uncertainties,

uiccti.

No doubt this accounts for many
of the Administration's ■ present

anvprsp

Cl'lSlS,

including the threat of World War
have caused most famiUes ;0

^aj^g
^

velopments seem to be pretty well
anticipated.
With the present
^

^

ufe

^

a

^

niUCh

all

0n

shorter

sideSi

,hat famll|es are

outlook

OsX

it is apparent

much less will-

promising

and distributor knows means tem" "help

fo^te^'anTpr^

my

opinion,

tion

an

over-all

ance

rnLjncl»?n".Syo|DVh«HAmSc.a»

Finance

io

lncOIlSXSLeilL

are

to

brought into better balmeet

competitive buyers'

—markets.
the

"recession"

accordinelv

and

the

companies, but in

1954

v"">

a

gen

oetiUo^^with ^ome ^asuriRi^s
and

P

Make

I believe

among

pS(5

economic problems from accumu,'evt "v latmg. At the present time, sevin

gxnectinff
ti

.

me

n

1

®

NHor fn atny°ne "n"Sh d"" the of CongreSS definiteIy, 1 fl6' UCT^ 'J" SpotS", in b"sinesS
^XrUywUhouT firs?adjustments currently under way It-S a matter of record that the and attaching unusual significance fland experience with depress33'
!na
metal and metal products public generally gets what it to even the slightest unfavoiable econ0mic conditions, certainly

u

uu

^st

been described. No one can .deny past few weeks, no one ha? to be next six months. The business and possible the greatest general
thn e(c?nomy has !ostfmost told that 1954 is a critically im- financial press have been talking t-ance in living standards in

forecast looks too

a

one

actions aecepted general business forecast

industries, scattered soft goods wants in important election years,
""f5' and, "Serous inventories. Suf£ice it to say, the public curAs a fair warning
I must tell
S.'T l" adj,ustm<?ntf f™m rently seems-pretty determined
vou that in most places where I've
^ t0 ^
T C°"
next year to have-among othei
been^ cheikine the business sent? tL0"3 ?ave been g0,ng ?.n fo/ m.?re things-security, tax relief, and
ment
and
prospects Tn
recent
"
yefs,0nta b^-by-line inc0me stability on and off the
weeks Tve found mv views to be basis -popularly termed
rolling farm. Just how any government
on
the optimistic Tde
No doubt adJust™e"1 u-a,very healthy proc" program can meet these somewhat
whirh
has kpnt
ffnnri

lor

^

ec0n0mic gTOUndS Respite the eco- taken to combat it.
is fo? a dfcline within the comi g
"Oss-currents wh.ch have
After the e ection results of the six months rather than after the hig| a;d riysing
of lts short"term expansive force.

Kinp

business

new

the

still

for

declfne

5%-10%

yTnr

...ne

means

Cautious

income

personal

about

are

Jan. 1, 1954.

on

appli-

I've already presented

rplatiors hpfwppn

and

total

lower

—and

th^WnrM wf^TT sider 1 the evidence.
cannot accePt
the World War II test'
automobiles,

"standard"

year—a

of

movement

clining trend has been established

Conference,

Chicago,




ill.

support a high level

of' busi- trary

aSMe'

nGSS'
Government Spending
„

,

as

a

Main-

taining Force

Government

is

now

such

a

nation,

accounting

TS

for

22%

of

caution

is

tossca

or

one

thing

to

be .cautious

because of deep-rooted fear

wrongly,

they

want

these desires fulfilled today-not

.

.

Both Caution and Confidence
It's

Quite properly, most observers powerful economic force in the
stress the weaknesses in the pres-

before

of dis-

aster ahead;
be cautious in tne face 01 an im

on

some

without
cannot

indefinite

installment

tomorro,/.
credit,

they

possibly realize their goals
22

.

r

The Commercial and Financial Chronicle.

(2640)

16

Independence

able

—Canada's Internal Threat
Stock Exchange

but

have

heard

and many

sources

from

and

sources;

coun¬

re¬

1

by

these

started

by

and built up by them
they could re-invest the

still today the

are

source

United States the most

the

me;

we

have

men,

because

or

the

for¬

most

Now,
the

all

of

tunate

I

agree,

that

the

God

with

world

an

-

A.

vt

and
to

which

to develop them

capital

produce them at a price
competitive with other

is

the

of

producers

product.

same

I

government

have

was

described.

just

mixed

everything. They
butter business,
wheat

However,

and

just

about

natural resources
in
themselves mean
nothing, it
takes human skill and human la¬

bor

is

Therefore, for the purpose of this

We

in

up

in the
business,

are

meat, fish, railway, hotel, air
line, radio, television, films and
social
security
business.
Thus

egg,

enters practically
phase of our daily lives and

government
every

this
us

activity on its part has made
increasingly reliant upon the

a relance encouraged rath¬
accept as a fact er than discouraged by the gov¬
that Mother Nature has given us ernment. Today about one quar¬

State,

talk I propose to

a

most

generous

material wealth
and

of the

measure

need to build

we

Federal

the

of

ter

amount

in

budget,

of

excess

This demand un¬
fortunately is not only from the
Old, from whom it could be ex¬
pected, but from our young people,

Of course
trend

along with this costly
its inevitable brother

goes

arms—exorbitant taxation.

A

business friend of mine asked

me

in

coming out of schools and col¬ recently "if a tax above a certain
leges, they think now in terms of fixed amount is 100% is called
pension funds and hospital bene¬ communism, what do you call a
fits; holidays and Saturdays off system that takes 83 %." I thought
and not of going out to carve out
this, a very apt question.
Our
fame and fortune for themselves. corporations pay a tax of approx¬
It

is such

a

well known fact that

thinking did not enter the
minds of those that developed this'

imately -50% on . their earnings
and
thenr the shareholders pay
their
own
graduated individual

country to where it is today, that

rate

F do

the point.
Those people were willing to risk
life and limb, their wealth, every¬
thing they had upon a calculated
risk.
It took courage, initiative,
intelligence, ambition and deter¬

them

mination

capital to finance and expand the
great enterprises that must spring
up if we are to develop this coun¬
try as we must.

sfuch

not need

and

ence

these

labor

maintain

to

independ¬

freedom that motivated

people.

security
the

to

They asked for

from

cradle

to

government
the

grave

no

from

but

on

the

of

off.

of

look

back

the begin¬

to

the

paid to
half

remaining

This is double
taxation and is most unjust. Does
not such a system act as a deter¬
earnings.

rent to the

take

to

people who
risk

a

afford
provide the

and

can

Confiscatory Taxation
Then

vidual

83%;

let

or

rate

a

One

has

to

not

think

that

the extent

It is only to

Canadians retain owner¬

we

shall benefit to the
our own rich
heritage.

ship that
full

drawers

of wood and

hewers

we

from

is

There

that these

hope

some

,

and I think
government is well
the fact. They have al¬

present
of

aware

allowed 20% of dividends
Canadian corporations to be
deducted
from the tax
payable

they
we

earnings into today's
depreciated dollars, some of these

men

would have earned

as

$100,000,000 in a single
and they
paid no income

as

While I admit that

we

much
year

tax.

could not

worth
ness,

the

effort.

I, in

my

meet many people with

busi¬
con¬

siderable capital, these people will
not invest in risk ventures where
the return is

high simply because
practically nothing is
This high personal rate also

back to that system of rugged
individualism, it is nevertheless

after taxes

true that this

prevents

go

was

the United States

the period when
was

developing

*An address by Bri*. Weir at a Lunch¬
eon
Meeting of the Rotary Club, Mon¬
treal, Canada, Dec. 8, 1953.

left.

our

being able to

people from

young
save

money.

One, of the main worries which

„




we

have

today

business is that

in
the

the

financial

junior part¬

how

his

of

in a struggle
free institu¬

it may end or what precise
of action may best enlarge

course

policy conclu¬

the

sions, by hedgi n g
them

triumph, of freedom. Under such
circumstances, to make a fetish of
tax policy, or to start one's eco¬
nomic. thinking with tax policy

with

around

countless "ifs"

"but s"

and

"on

and

other

therefrom

hands."

for

the

and

ultimate-

to

conclusions

deduce
with

re¬

spect to transceridently more im¬
portant and fundamental
policy

policy

the

prospects

considerations

the

questions, would be dangerous
beyond description. /The Federal
Budget—on both the tax and ex¬
penditure side—is but one aspect

economist

tions of political economy, which
of diminish¬ has always sought not only to cer¬

ing returns.

work

on

Government

reach
and

zenith

our

more

social

more

with

security,

taxes, can only lead to eco¬
nomic retrogression and not to

more

expansion, and the funny money
boys cannot change this funda¬

For

example,

be ap¬

now

thinking

every

there

person.

rages -a

now

controversy as to how fast and
how comprehensively we should

I shall endeavor in this

discussion to utilize analysis only
a
foundation
for
proposing

build

what

seems

the President of the United States

able

course

as

under

to

me

of

economic

current

and

our

against

to be the desir¬

policy has

foreseeable

defenses

attack,

although

declared

recently

Russians

conditions at home and abroad.

continental

sudden

now

that

the

have the capability

to launch such an attack and

that

openly with their capabilities will rapidly in¬
issues of public policy in a de¬ crease. I realize that the experts
mocracy
may
be suspected of with respect to continental defense
political overtones. But if some —and I am not an expert in this
Those

deal

who

critical

field—may well have differences
of opinion as to the most 'desir¬
able nature of such defenses and.
parts of the current Ad¬ as to the degree of their effective¬
I

of

today

say

ptiay

seem

of the economic

some

think ing wh ich now seems to exi st
in

some

ministration,
that

bered

let

it

during

governmental

be

service

ness

remem¬

period

my

I

was

of-

But the current con^

at best.

fusion in the

public mind

on

this

siibject does not stem primarily

on

this, kind

from

rather similar grounds .critical of
of the economic thinking in

of

disagreement

the experts. It stems rather
from a widespread and.-false as¬
some parts of the former Admin¬
not
misunderstand me, 1
istration, particularly as this think- sumption that we cannot afford
we have to pay income and
ing bore upon economic issues re¬ large expansion of this type of

mental fact.
„

solutions.

by less
of what
and have

pay

the government keeping us in our
old age. This trend towards more
and

parent to

tify questions but also to propose

Leaning Too Much

cannot

of this statement must

at, I am convinced

now

are

have hit the point

Do

among

some

,

know

other taxes for defense :ahd other

goverrimental

proper

I

and

expenses
to care for

have

know we

the old who cannot

for them¬

care

selves, but there is only so much
I

do.

can

we

reached

and

think

have

we

passed that point.

I
think we have gone far enough
with the policy of "a rich gov¬
ernment but a poor people."
Let
us allow our people to save money
after they have paid their living
cost and they will have security
and independence, also the wealth
re-invested

in

Canada to the benefit of all of

us.

will

saved

so

be

Inequitable Double Tax

on

think
on

the

inequitable double

shareholders could be done

away

with and

sonal

rate

where
those

skill

put

think

I

should

incentive
who

and

their

have

to

to

and
again
the wheel

once

and I think that if taxes
more
accrue

If

we

can

government
we

will

to
to

the courage

shoulder

would

per¬

restored

is

ambition

duced,

the

reduced

be

less

not
to

were

revenue

the government.

steadily
which is

the

to

national

defense.

defense without

a

sacrifice of suf-.

and caliber
degree of my consist¬ of our deterrent striking forces.J;
This fallacious assumption puts
in these matters.

Examination
reveal
ency

of

the

record

may

liciency

in

size

the

the

Even
in
ordinary times, tax
policy cannot be considered in an

isolated
vated

compartment,

to

without

policy

role

a

of

unfortunate

is

but

one

nor

ele¬

supremacy,

results.

phase

of

Tax

the

on

opposite sides of the fence, and

engages
in bitter controversy,
those experts who are concerned
with deten-ent striking forces and

those
with

experts who are concerned
defense.
To be

continental

fiscal
cal

policy of government; fis¬ sure, even under the best of cir¬
policy is but one phase of the cumstances, there would be some
policy of government; hard-to-resolve differences be¬

economic
the

economic

ment is but

policy of govern¬
phase of the eco¬

one

nomic policy of the nation; and the
economic policy of the nation is

tween

these two groups.

current

fusing
the

of

But the

unmanageable
and

and con¬
dangerous character

current

differences

exists

phase of its broader social largely because both sides are
and
political objectives relating following a false premise — the
to survival, progress, and human false premise that our economy
cannot afford, or would be weak¬
well-being.
If we should bear this in mind ened by, the development of both
even
in ordinary times, it is a types of defense in the amounts
vital imperative that we do so which all the experts in all fields
would agree upon as the minimum
one

*An

CIO

address by Mr.

Keyserling at the
on
Economic Policy Con¬
Taxation, Washington, D. C.

Committee

ference

on

re¬

stop yelling to the
for more and more

develop

lated

but

Dividends

net left to them after taxes is not

their

survival

struggle is in being all will agree,
regardless of their. views as to

to

or

devitalize

United

shareholder.
This is a may indeed be wrong, just as those
fine step in the right direc¬ of real or fancied experts in other
tion, but it is only one step. Also fields.
But our major economic of our economy and of our na¬
new mining companies are given
It is important, but
problems are great national prob¬ tional life.
a tax exempt period of their first
neither all-pervasive nor all-im¬
lems; they cannot be dealt with
three
years
in production.
We worthily through a fugitive and portant.
have a too sophisticated tax sys¬ cloistered
virtue; instead, they re¬
The realism and high pertinence
tem and at the prohibitive rates
quire adherence to the best tradi¬

lated

enormous

of

policy conclusions,

the

foreseeable
the

part of the free world

a

tions and of all of the manifesta¬
tions of human freedom. That this

the

by

personal incomes and if you trans¬

had

short

as

and

when

clearly engaged

for

*

very

I

men

stop

is

government,

to

or

current

States

factual

The

tax

These

of

to do

afford to do.

conditions,

conclusions of

people who are
making what effort they can,
or
who are only working "part
time," because if they did, the

area.

in

by

it

not

outside

or

ready

be

the many capable

inside

to amount of tax

productive potential

our

under

basi¬

cally interested in public service,

ly

only to look at

ning of the century; the time of
Rockefeller, Andrew Car¬
negie and the other giants of that
John

economist

an

analysis,

prosperity of our own grow¬

must

we

trying times, it is not
for

the

ing economy.

called

be
I

indi¬

rises

it

should

"confiscation,"

should.

the

at

which

rate

such

can

called

look

us

tax

"taxation"
us

dividends

any

out

by

their own ability and work gave
security to others less capable or
Willing than they; they were will¬
ing to take the risk and it paid

Let

.

these

in

use

"economic nonsense" U. S. cannot afford

as

to engage on-

Can we develop our country tc
fruits of a great dollars, is spent annually on social
trading nation, for certainly the security, such as old age pensions, its ultimate and at its maximum
very
essence
of the Canadian family allowances, etc., etc. This rate and at the same time have
trend
is
the greatest source of the breaks all set on those whc
economy is foreign trade.
Purely for want of a better title internal danger that we have and are above average ability and
I have named my subject 'Inde¬
it is against the continuance of ambition?
Can we, at the same
pendence versus Security" and by this
trend,
in
ever
increasing time, lean more and more on the
that I mean this growing demand
amounts, that I wish to sound a government, which in turn costs
for more and more security from' solemn warning.
more and
more?
I say "no."
We

the government.

In

sufficient

ly it would be better if Canadians
a greater extent in

an

billion

one

Foresees continued

scores

could share to

the

enjoy

expenditures to national needs than

what

a

yet, but sure¬

will for many years

Carnegie's,

etc. Let us have a
position as it is today.
about the opposite to

what

J

undisputed
fact.

provide

to

taxes

our

our

have

the

is

after

higher proportion.
I admit we
foreign capital and that we

matters will improve

It

large

of

not

of water.

States

the

of

and

if full employment and
Says it is far better to tailor gov¬

economy

maintained.

are

collections.

of

developing our
Canadians just
enough money left to

Rockefeller's,

portion of the
wealth

United

the

time

ernment

reason,

a

money

look at

good

a

Canada

in

in Canada are at about
point in our develop¬

that

the

at

endowdd

us

we

same

ment

sin¬

lands

cerely

is also

need

the

Situation

The

are

stantially injurious to the
production

to

Remember that in
powerful country on earth. It is the proportion that foreign capital
owns our
resources, we are only
a
point well worth pondering.

rge-

ment

that

these

that

and

rate

enterprises,

enormous

made

no

a

foreign

them

fastest

money,

clarification
e n

its

at

This

on.

C.

purpose

even the largest deficits which
might result from current levels of taxation would not he sub¬

country is so high.

of wealth and strength which has

sub¬

needs

ject

our

t c.,

e

This

etc.

many

natural

great

our

carry

able

be

gentlemen, why the proportion

people."

poor

lands all about

the wonderful future of

try

a

would

business

the

Attorney-at-Law, Washington, D.

of national economic policy
maintain full employment and promote economic

should be to

investment
fashion

the company as an

in

and

growth, Mr. Keyserling holds

system

a

Chairman, Council of Economic Advisers

Economist

Contending the central

by his estate and in such a

social security. Concludes,

more

whether or not we should

the capital of the
senior partners could then be left

far enough with the policy of "a rich govern¬
ment

We

and

Consulting

is today consid¬

Exchange

such

of internal danger that
we
have." Says trend has been accompanied by exorbitant
taxation, and warns against leaning too much on government
more

Former

why the

reasons

They Aie

as

By LEON II. KEYSERLING*

permit member firms to become
incorporated
companies,
under

holds this trend "is the greatest source

have gone

of the main

ering

Canada is now "mixed up in
everything," and about one-fourth of its national budget is
spent annually on social security and similar outlays, Mr. Weir

we

carry on

Stock

pointing out government in

in the trend towards

to

one

By BRIG. J. B. WEIR*
Chairman, Montreal

Leave Taxes

be
when the senior
partners die or retire and with¬
draw their capital.
This fact is
their capital and will not

up

Secnrily

vs.

able to build

not being

are

ners

In

Thursday, December 31, 1953

..

1

action.

and

For every

bit of this

faise

security

up

equal or greater part of
independence. It has been

an

your

well and

you

get

you

give

safe

necessity if they

were

not be¬

deviled by the economic nonsense
that the United States cannot af¬

ford to do what

we must

afford to

do.

Until

this

economic

fallacy

is

revealed in all its stark nakedness

truly said that the closest and
relegated to the oblivion
panding economy,
our
thing to real security is a life which it
deserves, there can never
only way to create real security sentence in penitentiary. This is
be anything but confusicn on the
and at the same time keep our quite true; but where is your in¬
Continued on page 38
independence,
both in thought dependence?
a

ex¬

Number 5286

Volume 178

...

The Commercial and Financial Chronicle

Little of

The

market

mined

this

deter¬

seemed

week

little in itself of

a

Despite rather widespread
hopes that the bulk of the tax
selling had already taken
place, there was plenty of evi¬
dence around in midweek that

the

postponed in

were

the

on

romantic

more

to provide hopes that oil-drilling
Happy New property had come on

Year for the securities circle.

such sales

but

hope that the traditional

if

All

these

Board

the

in

arisen

has

.

»!»

j!{

Sufficient pressure was

year-end
The rebound

bust.

a

from

the

October

bit

too

early to qualify

a

plan

stock

Gover¬

of

the

an¬

of

the

latest

The

two.

lows

came

as

the

sell down

in

the

hard. Both issues

as

than

more

wiped out the gains

sharp

lowed

ing

of

the

of

The

in

recent

years.

Celanese

is

as

severely

may

tion's

expansion

In fact, it was the poor¬

market than

any

re¬

de¬

desultory mar¬

Not that

if

if.

resistance to declines than has

their

been

corded since 1949.

It

habit.

upswing carried close to the
wasn't
285 overhead resistance level

enough to prevent new 1953

if

lows

for

Baltimore

The

&

heavy, but were
able to forge ahead moder¬
ately in the more quite mo¬
pressure was

Twentieth

ments.

Fox

Universal

and

well

did

as

the

group,

new

w e n

nomer

based

Pictures

others in

appearing on the
their ex-

moments.

t i

e

t h' Century,

strength was

•

any

a

bit of

because part
on

3-D and

any

of the

a

For

group

contributed" by

Southern Pacific.

the

weeks

lation in
average
levels.

a

program.

stockholder

tangible

some

directors

tne

should
tnai

evidence

cognizant of his

are

needs, *
The

articles, I believe, that Dr.
is

incensed

so

reduced

"(B)

was

a

again. The story
festive holiday
sad

one

This
hint at

again.

for

predilection
the blue chips entirely
made it almost entirely
a

institutional market. This

the company
dividends which

ing

long

any

over

trace,

the

financial district

gen¬

their fa¬ erally. Although Stock Ex¬
however change volume has what ap¬

wel¬

pears
over

to be a comfortable
last year

for

pay

large

taxable

lead

of better than

15,000,000 shares, the large-

dividends

the

and

about

are

cash
to

the stockholder and then have the

stock¬

the

tend

to

reduce

dividends

on

•

corporation

plans to build

which

received.

is

profitable

plants

new

additional

on

earnings

are

created, the stockholder is better
off to take stock rather than get¬
ting nothing while he waits.
If
a

is

corporation

something

estly

paying

already

stock dividend mod¬

a

increases

the

divi¬

former

dend.

Dividends

Stock

"(C)

are

de¬

a

corporation turn around and issue

sirable

rights

verting earnings into perma¬
nent capital."

to

to

these

additional

buy

shares

stockholders

same

(i.e.

American Tel. and

Tel.). A stock
will also help
investors
in
companies
which have
been
paying small
cash
dividends
and
re-investing
dividend

program

those

the balance of

the earnings with¬
giving the stockholder a fair

out

return

his investment

on

(capital

There

is

that

the

in

will

sell

at

same

higher

a

price

to

awake

firms

In

with

fact,

view

a

it

wide¬

more

to

while

paid

the

firms

have

old-fashioned

tended

to

ignore

the

advantages of paying them.
Where

a

dividend

company

and

a

pays

cash

a

stock dividend

as

well, which total is more than the
earnings of the company, there
is

question that this could lead
inflated market price for
the shares. This explains the re¬
an

action

cent

by the New York
Exchange in regard to In¬

Stock

Business

ternational

Carothers

article

Dr.

Carothers

"the

misconceptions

mind

boil

down

says

have

I

three

to

in

propo¬

sitions." I will quote each alleged

misconception and then try to
swer

ticles

in

vided

Dividends
substitute

are

a

for

de¬
cash

Stock

dends,
a

dividends

but

they

increase

no

in

corporation

a

profitable

ex¬

the

This

is

the

not

dividends.

its

needs

company

business

proper

intent

of stock

believe that when

I

money

purposes,

better for the company to pay

stockholders

the

stock

to meet.
does

these
that

have

prob¬

many

large cash divi¬

A

not

solve

necessarily

despite

problems
some

and

receive

to

dividends.

Corporations
dend

a

for
it is

stockholders

the

fact

need

the

immediate cash return.
The

purpose

it seems to me of
policy is to help
when

stock dividend

immediately

stockholders
cash

is

not

available for

a

larger

distribution and at the same time

substitute

sirable

as

cut in dividends pro¬
stockholder sells his

a

stock dividend."

a

Stock

"(A)

dividends.

cash

an

change for

an¬

them.

of

they

Carothers
states,
attempt in the ar¬
question to present, a

is

stock dividend

lems

he

letter

that

example,

"There

Cash

Dividends
In

than

his

in

favor

in

claim

dividends

better

For

for

Machines.

Unincreased

implies

those

that

stock

some

Preferable to

by Consolidated Cigar.

Misconception of Intent
Dr.

no

to

Dividend

Stock

ex¬

dividends

stock

more

re¬

pro¬

Note the re¬

is completed.

declared

should

expansion

Preferred

are

have

pand

the

cent

than

the

me,

when

the

and

earn,

stockholders

gram

pays

dividend.

cash

seems

on

Obvi¬

capital.

should

the

more

.

the

into

money

earn

reconverted

poration

that

that just

company

con¬

ously the larger the invested capi¬
tal is the more money the cor¬

my

company

for

earnings

management

this

small stock dividend annu¬
ally in addition to a cash dividend
the

converting

By
the

ceive

question,

no

instrument

permanent capital you are making

surplus).

and

are

for
are

not

de¬

a

divi¬

cash

better

dividends.

needs

to

than

them and

give

profitable

more

the corporation a
business in the

future.
WALTER J. SCHLOSS,

When

Security

expand

Analyst, GrahamCorporation

Newman

block

dealings of institutional
again left many of

brokers

untouched.

back to October speculative issues but also year, in short,
short of
worked against the well-being ably
of

taxes

paid

are

If

These articles
pointed
advantages
of
paying
stock dividends rather than hav¬

the

worked against not only the
by the rail trader dabbling in the more

disconso¬

Stock Dividends reduce in¬

Stock

the

put

retreat

so

dividend

income taxes by translating regu¬
lar income to capital gains. Taxes

dividends"

capsule resume doesn't
the unusual selectivity

of the market,

abruptly

stock

no

off

better

was

holders."
•

Graham.

if

if

with

come

appeared in the Aug. 3 and 15
issues of "Barron's" by Benjamin

But since the rail fol¬

so

corpora¬

a

stockholder is

than if the dividend

investors

to mend their ways was
come.

get

the

their much conso¬

lowers have been
late for

jeopardize

sirable

an

was

two

*

if

if

if

Nor

of it isn't slight, that they were trying
rage over

the

that

mis¬ vorites,

biggie screen devices




the

Century-

highs list in

huberant
T

as

of

but faltered

Ohio, for

only group able to
Pennsylvania, Canadian Pa¬
show buoyancy in the yearcific, New York Central and
end evening - up were the
St. Louis-San Francisco along
movie issues. They were none
with
th^ somewhat jarring
too stable when the selling
new low
for the quality end

that

opinion,

points before another reaction
est price seen for this peren¬ they were able to shrug it all occurred. Early this month a
nial favorite of the three-year off, but they showed far more new attempt to generate an
bull

worse

earnings have to be re¬
for
expansion
purposes,

tained
but

-

moments of softness.

dividend

reduction of

a

cides that

rather early
early November the list had
goods end of the stock list.
recovered to around 278
guessing about the eventual
if
if
1954 dividend payout. It was
where a bit of opposition ap¬
For a change the long-sick
enough, whatever the valid¬
peared. The improvement was
rails
weren't too ready • to
ity, to land the stock at a
extended, somewhat labori¬
take over the leadership on
price a third under the 1953
ously, another couple of
best.

is

The payment of stock dividends
is used when a corporation de¬

and

switching

stock

a

forthcoming.

Target

-

get

(i.e.

well rather than

dends

pressed as any other in the
kets through the Spring, and
division, down below 20 after
a far less
Chrysler, which has been the better
spirited summer ral¬
than
50 level
leading a rather pedestrian reached in the very early ly than had been anticipated,
existence since its last weak
led,
in September, to the
stages of the 1950-53 bull
spell, was one of the week's
year's1 lows with the indus¬
swing. Nevertheless the issue
selling targets on a multitude was able to slide into new low trials reaching the 255 zone.
of rumors and estimates
The rebound was one of the
ground for the last half dozen
which included new financ¬
more
enthusiastic events of
years this week, a feat by no
ing, large block liquidation, means noteworthy in the soft the stock market year. • By
a

by re¬
$3.00
Caterpillar
say

cash dividend from $3.00 to $2.00
with no stock dividend.
Market-

wise the

if

series of

payout

a

pays a

A

Chrysler

as

than paying
although some¬
times payment of large cash divi¬

if

sje

cash

share

a

to

dividends,

year.
i

:<c

a

$2.00

holders

Stock

Heavy Textiles

conviction
if.

:'fi

over-simplifies
situation. No one,

I
believe, has said that paying cash

mately 294 lasted for only one
Textiles
Christman Eve in 32 of the
generally
fared trading day almost exactly a
last 39 years for the indus¬ little better than American year ago and the highly selec¬
tive markets in the following
Their
persistent
trials, found their hopes Woolen.
months made it unlikely that
dashed as the market lost a heaviness
lately
has
even
the majority experience was
couple of points as though it outdone the sugars which
been
casualties
with one of sizable profits for the
had never heard of the tra¬ have
dition.

10, regarding the evils of

complicated

more

by New Year'sEve over

the "Chronicle"

dividends

dividends

ajl a bit
A Sour Finale
phlegmatically, possibly
The final sour performance
because at the
going level
strongest of the seasonal mar¬
of the year by the list caps a
ket patterns. As a matter of around 15 it is well deflated
12-month that has been any¬
after the mid-40's recorded
fact, it ran out of steam in
thing but encouraging to the
the early part of the month. two to three years ago.
investors. The year's peak in
Even for short-turn followers,
*
*
*
the
industrials
of
approxi¬
who can chart higher prices
year-end upsurge which,
incidentally, is one of the

Dec.

stock

the next im¬

if

its

Tractor), it is better for the stock¬

Carothers

if

reduce

ducing its dividend from

tor, published in

took it

common

Neil

Carothers in his letter to the edi¬

portant move.

plan before finding support.
The

on

Dr.

future profits.

up

to

three months old is

that fol¬ be breached

runup

announcement

that

me

Maintains

by progressive
is to benefit shareholders

and therefore feels that it is better
to

to

seems

com¬

expansion

and build

Chronicle:
It

alternatives.

over

of

purpose

Editor, Commercial and Financial

285-77 some
going to

of

range

,

instrument

while conserving cash,

re¬

treat found

is

States main

companies.

.

retire

to

dividend

recent

on

Carothers, cites alleged advantages

stockholders of stock dividends

to

preferred took two sessions to question of whether the trad¬

around to make the

rally

nounced

munication from Dr. Neil

In

over

'

i

Waiter Schloss, security analyst, commenting

>

its "doubly dour at this time of
find. the year,

support at almost
the precisely where it had been
prior preferred brought some expected in the 277 area. The
add a bit to what profits were
drastic
shakeouts, including approach of the holiday after
to be gleaned before the final
the one-day tumble of the is¬ that decisive move left every¬
page of the calendar was sue of
something very close thing a bit indefinite and put
flipped over.
to a dozen points. The senior off to the new year the vital

year-end rally would trim the
losses around and, perhaps,

nors

fv

are

retreating from the re¬
Some of the hasty conclu¬ covery highs after the list
sions about American Woolen made, its low in September,
painted a more dismal picture •the market has tried twice
for its issues, particularly the since to get going, the early
preferreds. News that dissen- December attempt the better
tion

EDITOR:

In Defense of Stock Dividends

con¬

on
a

THE

TO

en¬

new

weakness.

on

if

if

lead

to

scatter

highs by
a
decisive
margin.
Selling
provoked the higher volume.
The list expanded markedly

STREETE

By WALLACE

to

New:lows

couragement.
tinued

LETTER

technical nature

a

around

was

THE MARKET... AND YOU

17

(2641)

441

Dec.

28,

The

consider¬
satisfying to

was

most of those who follow

East

in

a

St.,

N. Y.

1953

R. L. La
Ralph

se¬

curities.

20th

New York 10,

L.

Quey in NYC

La

Quey is engaging

securities business as a mem¬

ber of the National

views

expressed

in

this'

Association of

He may be
necessarily at any reached
by addressing him at Box
:time coincide with those of the
General Post Office, New
Chronicle. They are presented as 797,
York City.
those of the author only.]
[The

article

do

not

Securities

Dealers.

18

(2642)

The Commercial and Financial Chronicle

4Ann

a

a

Illkk

II

|

I

•Ww

,

unions. Walter Reuther, in his
In September, 1952, the Presiacceptance address at the time of dent of the International Associahis election as President of the tion of Machinists wrote that the

i«

ntlflAi

^

,

,

1031
'

.,

,.>,■<!

L3D0T K013tions
h* 1 '' H 1 ■■
CIO stated:
.

mmimmmw*

.

^

By HOWARD

S.

KALTENBORN*

Director oi Research Industrial Relations Counselors, inc.
Director of Kesearcn, inousinai neiauons ^ounse
urs, Inc.

Dr. Kaltenborn makes

take

an

i

.

.

on

of the

some

l

of

ranahlp

'

doing

if

«

We

bave

cusses

political action by unions. Dis-

labor situation in event of

depression, and con"firming up the economic

policy can contribute to
:c
3
c
j
c
only if based on a sound foundation of

„

,

,

arch,

,

,

■'

.

,

..

,

is

evident.

prospects of

.

The

state

_

tion of

j

a

Labor, evaluated the

pros-

pects ahead in these words:

and

fapfnrs

"This is going to be

labor

Dolicv
lv

Eaual-

obvious

is

'■

the

fact

'the

that

economic

effects

given

of

1

any

b

a

polfcies

•

promise.

rondi-

tionins

often

tal

o r

the

ac-

complish-

'ments

of other

.

.

year

wmmm
STT"..»b.rn

In

the

but
bor policies
of

men

many

la-

designed by practical

affairs

in

government,

these

confine

many in the Republican party
to cooperate with

areas:

The

remarks to
appraisal of some

an

my

of the basic influences

are

trying to

failure

of

the

the

„gingle

?

5?'

•

?

,

it is more pronounced m the latter. Although the labor movement
kept

'pacT'wm theTxtnsion™
labor

force

union

as

whole

a

membership

In

repre-

unl°n JrfS? S

^ * 01

"a™a™

™Ial

employees

or

tne

view

^be

0f

even^

difficulties

attempt

to

woo the AFL, the present openlyexpressed hostility of Mr. Meany

a"0tXr7n inlhcITniTl 77
membership.in the| united btates
.,

a.

,

^

hnt

HnHntr

the'labor

npriod

that

otficials.

osoDhv

stated:

November,

for

"There is

of

many

fear that
depreSsion
there's a tingling

bad

we

deny-

no

worried,

us are

eyen

forrp

aDnroximatelv

nine

times

or

return,

may

union adopted a statement on collective bargaining policy in which

fpar o( unempl0yment is the dom-

dine ,n employment even i£ busi.
ness
conditions
remain
good.
is

the

further

possibility

that a sharP recession may occur,
If this does happeni there un.
doubtedly will be substantial layoffs in the oil, chemical, and allied
ind"stries and there certainly will
.

pulsions

ment-employee relations.
Factors Influencing
Government
Government

'
.

are still present. The Administration still hopes to neutral-

Labor

Policy

Pnlinv- ThP nniui
Policy. The politi-

cal

situation confronting the
ministration
is
nrenarinns
minisuaiion
is
precarious,

AdThn
ine

Republican margins in both House
and

Senate

are

the

and

narrow

ize

gain the support of the AFL

or

as a political factor.

The difficul-

.

the off-year elec-

power tends to
lose about 20 seats in the
House of

Representatives.

Commenting

on

u-

gree

of

the party is to hold

present

slender

Senate

and

or

increase its

majorities in the

House,

we

must

ac-

I
£ r|yerse the trend of history.
Strong

therefore

to

at

compulsions

work

are

the Repubhigh command to take
steps

iican

avoid

loss

of

on

control

of

Con-

gress in tne 19d4 elections.

overall

de-

timated

at

roughly

14V2

million

persons, out of a total labor force
in excess of 60 million. The
experience in Great Britain, Sweden,
and

other

unions

countries,

have

established,

Faced with these hard

over

two

been

in

long

which

and

well

and

out

one

out

of

political

indication

^

•°

two

three.

never
or,

rise

at most,

Nonsupervisory

nontechnical employees potentially subject to union membership in this country total ap-

proximately 46% million. In this
country, the lower of these ratios
would

represent

a

trade

union

membership of nearly 24 million,
higher ratio would yield a

and the

trade union

that it is prepared to take all reasonable
steps

In

of

may

and

membership of more
than 31 million, as contrasted with

reahties, the Administration gives the
every

million

organized.

now

actually

;

Much of the trade union

mem-

1944,

six

and

at

one-half

which

in-

mil-

in

point

tn

a

woi

!PP7ximatelv

mpmhpr«hin

0^11110?
app£**,
million.
n

nf

The

Ihe
various affiliated unions pay per
capita tax to the AFL on a mem-

u

a

.

Federation of Labor into becom-

January,

George

Present of the American

Meany,

This apathy and lack of

interest prevails

among

members

Federa- of both affiliated and independent

*theP Fair ivGetin'*Iiftthb0A aelivere<J
Sci.nct
&AS,dy?y "

P..U.C1




frade

union

influences

policies of

movement

the
the

are

following.

has

ormrrpd

has

in

occurred

manv

in

many

President

of

bilities to several groups, its primary responsibility, is to act as
a trustee for the owners."?
This

philosophy

- represents
some-.departure from that expressed above.

that
to

the

stockholder

dominate

the

management,
still

must

view-used

thinking of top

that

view

management

things

primarily

fr0m

the standpoint oi the stock.
holder
but that there neVertheiess has been a vast

change in
management's concept of its
responsibilities. He indicated that
top

„u jg now jus{ good business for
the stockholders to protect the interests of the employees, the cus-

tomers, the public, and the State."
He declared that the top managements must try to persuade the

stockholders

that, ".
it is in
long-range interests for the
company to use their money for
maintaining other important
things besides paying out dividends. We have.to convince the
.

.

their

stockholders that they don't have

1B*
.pnmnlM,

being

not "union

"orglnized"

nr£,nni7pd

(2) It

is in

into

ing

I Ceorse Meany, "The New Adminis-

minded,"

thing

a

in

this

but

company

might

as

or

but not "unionized."

y

*

stockholder

and

say

the

on

j

t.

do

sometimes

f
cause .the
stockholder -j to .■ feel
P^ce^siof^com- critical,
bands, and this is diSCussecl at least until .we have
these

4he

new

Philip
is

with

long-range, aspects
This executive sum-

him»

marized

his

Jbemb^rship.1Sostr^°

thinking

this

on

uine
~ wur'
Sld?ey+ Blllman \s dead> point as follows:
bon' Eve?, in lhe AFE> however, William Hutcheson is dead, things, we have /'To sum up
these
several
^he growtb of membership has Bajyey Brown is rehred, Dan conflicting, or apparently conbeen slowed appreciably, and the Tobin is retired, and John L. dieting interests of the stockincrease in membership represents Lewis is of very advanced

part 1Tlereiy th^ pickinS UP of
the membership that the CIO has
t°st.
-

The shrinkage in CIO membership has been considerable. Since

(3) Its leaders
the

future

how

to

(4)

and

The

age.

are fearful
uncertain
as

of
to

for it.

prepare

strategy of its leaders

has been rooted for

some

time in

1944, when its ranks numbered six the conviction that its
major hope
and one-half million, the mem- for surviving
any substantial debership has declined to the point pression,
with
its
strength
in
where the CIO now claims
only membership substantially intact,
five million, and it is probable lies in political
help from Washthat the actual membership is not ington.
The results of the last
more

than

four

million.

More-

the AFL has the advantage
of being a diversified trade union
over,

federation,
with
109
affiliated
unions covering a wide
variety of
industries, whereas the CIO has
only 30 affiliated unions, and half
of its total membership is concentrated in two unions, the Steeland

the

Automobile

and

are

a

bership tangible benefits in the
form of increased wage rates additional security provisions etc
2 "CIO

Is

United,

Reuther

pA7e"C°" PUT F-'" C/0 N'"* D- 8-

events

Martin
both

the
be

Durkin

fears

and

degree

have

produced

uncertainty
kind

and

to

as

of

help to
expected from Washington.

M9n;i)rpmpnt

evidenJ;
,

pniipv.

f thp

fh

?c

^:'nJ nhiloeo?

h
.

tw*

f

inrhfctriQi

nianaf,pmpnihnsip

fnn

nnH

natuie ofikresnon-

holder, the customer, the employees,
and
the State.
Out of all
that, we resolve a pattern which
we
believe is ultimately in the
greatest interests of our stockholders and which, I think, pretty
well represents the greatest in¬
terest of all the other elements

that

go

This

to make up the pattern." ®
statement

typifies

in-

an

termediate stage of the transition
in

management

has

philosophy that
occurring.
Many busileaders today have carried

been

ness

their

philosophy as to top management's responsibilities one step
further and

holders

eral

now

view

the

stock-

being only one of
influences surrounding
as

sev-

the
company which in some way must
be harmonized or reconciled in
the interests of the company as a

whoIe-

This Philosophy

may

be

'°lCdnatt^tleaders cited
a."d sibilities0fand job. Many who are numb®r oi by the remarks of a
nitrated business

haunted

by prStPeCtS 0f natural depresan°therfear that
There
is

subsequent

culminating in the resignation of

fundamental

particularly the latter,
sion.

election

Dart

a

or

close

Warns

>952-

to

the

^oSSgTof'la^^AmericL
porations

testify

7""Z
a
^b_e'!hi.p. ^hlch,is °F" " is apparent in
mented.

Last

basic

bershlP of elght million and there aJways a critical moment

^0thi

KaS£1 c:^ apathetic and show little interest
nPnXntiUni0Hn^em^e^are+0ften.
"wnninffh

the

mcddjng fbe jab0r

1S reason t° bebcve that the total Murray is dead William Green

Sj °,f control of Confess bership today lacks the union con- workers
cohesiveness and soli- Workers.

11fplv

among'

that

.

0f summary, we see

wav

it

aT?d t0 repeai "5 victory sciousness,

original poliS%totegy enLm6 AFL^craft'lmion^f61'"^ thC 0ld
V
®tiat.egy e"conl: AFL craft unions of earlier years,

*t

lion

„mwn

The

organization, although it
greatly by industry and

overwhelmingly against con- nical employees

tinued Republican control of Congress after the 1954 election.
If

to

1939, which

thia

Nevertheless,

i

Union Policy:

secure, suggests
this experience, Senator Ives
has, that the ratio of union members to
pointed out that "history puts the all
nonsupervisory and nontech-

odds

creased

in

prevails.

which

mpm

u

are not
reassuring varies
Administration. In the 1954 area, is of significance. The labor
Congressional elections, the Re- unions in this
country embrace a
publicgjas face the very real pros- membership which has been es-

tions, the party in

lion members

,

to the

past is that, in

AJ|L had approximately four mil-

of course,

are,

in

the
the

y ^ It is incompletely organized
. qqq .
empiovees
^11 these
grpativ inrreaqpH
cauffht un with thp CTO in
and much of its present member- l/~.
emIJ1°yees. . . . ah mese
f
greatly. increased,, caugnt up with tne ClU in memanathetic
but the objective remains.
bership. Since 1944 the AFL has ®ni.P 1S apaineuc and described as thinSs represent quite expensive
ana aescrioea as
..

prospects ahead

pect of losing control of
Congress,
The political pattern that has repeated itself many times in the

membership, whereas the CIO has

s^d^red significanct losses. The

There

for

own

Airlines, writing in
December, 1952, stated that, "Although management has responsi-

the bottom

on

by

of the feet ****** holes in the
Still another top business leader,
shoes used to be'"4 Almost a year a chief executive of a very large
later' just a month ag0> the same of com pan?, has stated his belief

^

importance of sustained effort to of Senator Taft, and related facimprove
future
union-manage- tors\ But tbe same political com-

who

3 1
Damon
Trans-World

In

editorial in the paper of
the CIO Oilworkers International

inS tbat

management
those

companies
still

dominant °sophy

an

must

significant change in that phil-

a

.

.s a

and other unl?^ officials, results
...
T
y dppxux maieiy nine be widespread unemployment in
labor
policies
of
government, oot from Administration intent or
''
all industries.
."5 The same
unions, and managements, a brief indifference but rather from a
But these aggregate figures are fears are readily apparent in relaassessment of the probable results combination of miscalculation and deceptive,
for i"ey conceal the Hon to other unions.
of those policies in
1954, and the ineptness, ,the unfortunate death tact that the AFL has grown in ^
s
.
molding the

most

zone or level of man-

business." 6

in

"major slump."

any

Fear of depression

There

.

the

other1 consideration.
the fundamental concept

ot

many

serious

inating factor. "Barfing national
But since emergencieSi we expect some de.
g

ago,

any

fact,

benetit

are

'IZ °

naa increase to JO/.

In

encounter

Union
h»f

years

so

been

directors

of

It is worth of the first
the AFL

some in

par-

rm

weigh

wbjcb

a d other factors
pu renBy str
■8

J®adersh lpAp7
bf ?

or

not

"The point of view of

ago:

board

industry» unions,
Hayes prophesied will

changes

'fy of cracking down on labor.
year it has fallen to its pres
A.Irfady, there is ample evidence em Jlevel ,ot do A (14 /2 million

plish diverse objectives.
will

We

The foregoing
contribute to. a
*eebng.°

' As political realists, many of
the Republican members of Con- senlea

that

the CIO and

.

V1 *be history

"cipate in great social

.

unions, and managements to meet would prefer
varying problems and to accom- labor. 1
I

ly

20, 30,

noting that most of the unions in agement is

the

^lvl^.zatl®" 1S frying consciousto give direction to the shape

thi
t

new Pies dents good iaith

There are- in P°sslble for th.c Party 10
fact, not one |»ng in power if it pursues a pol-

™

of

^

have

group

the nature of this relationship be
identical with that of the stockholders. At all meetings of the
board, this viewpoint should out-

in

union

ft mf

the

no

&&&&? * * ^

.

"Dwight D. Eisenhower pledged
*be American people during his
campaign tbat be would be fair
and ^ust to labor- He started making good °" that pledg(r even be~
fo.re ent?rin£ tbe White House,
aPP°intment °f Martin P. Dur-

2

?

objectives, gress know that it would be lm-

_

y

to

years

up

control whatever."3

We haw

pr

consdous

J

of history.

big

a

are

inciden-

to

them
4.u

.*b® "5.

.

i

not possible to

is

tbe jn(justry over which it had

fact that the free labor movement

constructive

hustnessis^he

H-

It f

l

union-employer relationship.

That labor policy and the state
of business are significantly related

make

to
*

a

for

backlog of strength that

up a

standards because of conditions

.

f®" ™et hlfman

l-

l

build

e have to give our mem-

• * *

,

severe

eludes labor

industry that it

to-

.

.

'n'0J *oniy will hold

job>

a

<(

more

.

Up

t

the standards through
to organize the unorganized, but a major slump. A horrible examwe have a job of educating and
Pi®. 9* *0day is the textile union
unionizing the organized
which had to submit to a slash m
_

hand will nlace greater stress on a guaranteed wage and other
hand, win place greater stress on a guaranteed wage ana otner

"fringe" items. Foresees

null

we

«ether in the davs ahead

articulate.

of 'the great versatility of our viewed the stockholders' interest
membership." He added, however, as being the dominant interest to
that> "We learn from the experi- be served by top management.
e.nce ot unl0ns whose destiny is This is illustrated by the follow?ied to the fortunes of one single ing statement written some 12

kind

probable results of these policies. Says 1955 will be critical
year in labor-management relations, since managements feel
impelled to resist further rising "costs, and unions, on other

as

IAM could "carry on effectively managements, question thatpart,
there was little
top

of the

areas

men

very

even in maj°r depressions because

some

earlier

unorganized and begin to do the
of job I know that we are

appraisal of influences molding labor
j
policies of government, unions, and management, and assesses
f

We have to recapture

crusading spirit w£ had in
days, and we have to

the

Thursday, December 31, 1953

...

3A-

J'

Hayes,

to

this

inner

cor-

change

the speeches and

"Pre-C

o n V e n t

i

on

Jh®u«h*s" Ju°ihini8l% Monthiy Journal,

bel™>
the list could easily
be expanded.
..

Frank W. Abrams, Chairman of

6 Paul

ment

E.

Holden,

Organization

et

al., Top-Manag0'

and

Control,

1941,

Fori.'clfi'uUmvers"y P'ess; S,aB"
°'1 Worher' Nov- 17' 1952' Ef?ectllehlJaderI?" ^
Ahead-

^

0<«- I2-

address, June 4,1952.

"■w ww* in «Kiwr^ ■

Number 5286... The Commercial and Financial Chronicle

Volume 178

J
main
that
is

healthy, but

will find role

you

maximum immediate profit

a

sole

guide

You

will

estly

private

of

find

dedicated

workable

enterprise, ment

management

and

to

shareholders, its
its customers and

ployees,

a

doing, top managesurrounded by

so

•

Labor

itself

sees

<

-

policies

Government

unprofitable

-

,

of

will

with

an

uncer-

Federal tain or bad prospects for the fulittle ture. ln Ibis situation, forces that

the

have

company

but

influences, the stockhold- significant
economic
impact
in
unions,
and
many
others 1954, although government actions
run in in other areas will exert great in-

ers,

whose interests sometimes

em-

the

public at large."5
fenrv

insti- test."

an

pressure

a

balance

its

among

company as

are adverse to good industrial
relations begin to influence managements, employees, and unions,
parallel and sometimes in opposite fluence on the trend of the econ- Managements confronted with real
directions, with top management omy. Of greater economic signifi- cost pressures see their industrial
having to set up "what it believes cance than government labor poli- relations programs and activities
to be a fair policy for each one" cies in 1954 will be the results as
??.?tlr^ money and yielding

earn-

maintaining

acceptable

of protecting the sur- become a participant in the con- and good employee morale in

as one

vival of the

longer considered to be the tution. In

no

(2643)

19

.

wKUn

tried this and failed.

situation

Unless the

desperate,
the
probabilities are strong that union
members again would not follow
were

their leaders politically. This
leaves an insecure union, its existence threatened, tending to become less responsible.
The labor
movement would not submit to
the threat of extinction peacefully.,
A severe depression would pose

the

Company
job of management is "striktag
the
best
possible
balance

the

the

among

various

brought to bear

txuy

uiit:

gxuup

holders,

ut:

It

it.

is

nicy

employees,

con-

'

_

Price, President of
Westinghouse
Electric
Corpora-

■

of

balance

fair

a

does

.

»

.

ho

and

What

circumstances, where three
their

naturally pulling
advantage? It sets

are

own

what it

up

believes

policy for each
it

sepa-

notavciiu

™

groups

for

cus-

"What

add«

and he adds,

,

management do under these

ruto
rate

£

u

,

to

be

fair

a

and enforces

one,

Whenever

-

a

prospect,

in

"tightening

of

the

belt"

of

progress

of

in

pro-

Company'°lnd^aTnumber

influential

ii.7

of very

companies

7
F progress oj. ine Dusiness
while being "fair" to the parties

In

carrying

out

tions

the

director

must

long

view

mind

the

must have

public

func-

take

decisions

in

u

be

said

his
and

bear

interest

He

puDiic lnieiest. tie
social sense and must

a

continuallv

a y

problems involved

cisions

of

the

aware

board."i2

the

of

aware

If
human

°}

ine

de-

m

will

the

survival

would not
wi
of

the
uie

of

a

company

the best interests

serve

stockholders.
snjuKiiuiueus.

One

writer
wxitei

one

thus summarizes management

sponsibility in this area: "It is
generally agreed that men
exist either

tives

in

far

so

directors

as

large

companies

their

as

renow
can

execu-

or

only

in

concern

first

is

Tn

i

anpc

H
He wrote

4

^

ci

ary WatPP rathpr than nf owner,
legatee, rather than ot nwnPr

ty uture

ic

th»

well

as

corporation

.

.

legal. 14 This

as

©f course,

Though 1954 will bring changes
in government labor policy, the

tlic lowest

msii

.

opinion,

willing to

not be

their philosophy

carry

to this point.

Thus,

the

over

losophy

of

top

years,

the

phi-

management—top

management's concept of its

own

—has been in the process of traneition. It has been changing from
a

economic

Taft-Hartley Act. Important
though the provisions of the Taftpmnnm;p ;m_

th

.

hartley Act are, tne economic lm-

Pact of the probable changes will
h

„ii-ht

A1thrill(,u

:n

an

be^shght Although an increase m

other

consideration"

tn

thp

Xlosonhv tZt Ion
must maintain
JSril
Llanl ln
SSrc lie
among its
rmtnmprs
a'nd thP^urffp Jl
customers,
ana
tne
puouc
at
"a

arppntahlp

t

a

o

It

agement

is

obvious that top

is

beginning

to

man-

see

its

/vet

win

oe

p.

a.

White,

"Some

5

v.

V

ov,

an-

have

shifted

their

WUIte?

+i

emohasis

from

pression. Labor policy can cOritribute to "Firming Up the Ecd1nomic Arch" only as it is based 0S1
sound

a

empnasis irom a

foundation

sound

nprmittiritf

lounaation

permitting

for

strikes.

in-

moderate

The

increases

to

1900, the record is littered with

the

dead

bodies

of

unions

that

upon

the

problems

and

possibili¬

ities.

Probably be lower than in

^ 3 strenuousTy reffsTIncreases
suenuousiy resist increases
,

,

.

m

in.

Jhe contiacts in the automobile

.

industry
r
in

1(fiY

carry over

^

until 1955, but
•
'

cp

cems pei houi increase

New York Central and

1954 resulting from the "annual
improvement„ factor will in£lu.

^Uthe"c77rseio£'negotiations1 in

,

0^er industries.

,

wa{yp

,

for in

th® Present .law. Again,

eC0n0mic

tain

however, the economic impact on

controversy
ment»

and

tax

structure

will

probably

probable
pronaDie

ine

changes
cnanges

in
in

govgov

ernment labor policy in 1954 will
^

primarily

political

over

and

the

the "living docu-

approach

.

TT

prospects

....

..

...

,

PartialJy the political front. en/r
to dlveit^d f^om
More.

nomic
ovpr

with the Congressional elec-

con-

government labor policy in an at-

P

unions nor

o

*

g,

app oac

e t

managements will wish

thp

v,9Vp

fn

plprtions

background

hpld

against

of public unrest

oc-

toned bv widesnread strikes

Responsi-

JliceJp?! fr0om°aattealkad1fMbuntVd

a

CoPraD?rat!on ^lewaVCenlfr^oi

,

ings of these roads would suffer
far more than the average.
a

Given

further breathing spell in which

complete their property pro¬
uuwevei,
me
however, the uutiuuK. iui
outlook for
both would be considerably
brighter. With the present uncertainty as to the timing, or ex-

to

gidiiib,
grams,

tent,

of

possible

a

recession

it

tral sold at competitive bidding a would not be surprising if these
new series
$15 million of its stocks should continue to hesitate,
consolidated mortgage bonds. With
For a time earlier this year it
a

coupon

3%%

of

the

company

Was

indicated

that

Central

was

discount and making gratifying progress in getthe bonds were publicly offered ting its costs under control. Conat par. The issue was quickly sold, sistently through the first eight
got a

at a

nrimarilv

tn

inmiranrp

romnanies

mnnthc

nf

thp

vpar

thp

tran«nnrM

0 ins".r.Y companies, months ol the year the transport
Thls dlsPlaY °f institutional en- tation ratio, was running apprethusiasm did not, however, affect ciably below the levels of a year
fh

tock

market

Railroad stocks

siock marKet. nanioaa siocks,

feriipr

garner

and

ana

fnr

tor

thp

tne

npriod

as

a

penoa as. a

and Partmularly the more specu- whole the cut amounted to three
lative ones contlflued; up '? the P°ints. This trend was reversed
time of this writing, to be domi-

in September, and since then this

all-important ratio has been run-

Df

jess

government

ow

inter-

an

.

that

we can

mobilize in Washing-

put honest, hardworking
men
and women out of work.
the full power of private industry, of municipal government,
of state government) of the Fed_

would

eral

Government,

bilized

to

happen.

gee

that

will
that

I cannot pledge

be
does

monot

you more

than that."15
is

significance

more

in

the

than

symbolic

fact

phrase "private industry"

that

the

appears

before that of "state government"

,

fne^^dfwnce
\of5
f.

unex

no

Umons

wi rbe nresent in ^Ven^ f°J ihe^m1°nth'.
M°re
irTigSS bardng dis- than 30% °f th.e dec.h"e ™ reJ;

Uni°ns in iyoa, oainng ais enues was carried right through
11 n c 11 y unfavorable economic to net inc0me. Net for November,
Prospects, will be prepared both 1953 amounted t0 $i,063,178, or
for major negotiation efforts and ?8 6% below net rep0rted a year
for breaking new ground in earljer> New York Central in Noterms of the guaranteed annual vember sustained a decline of
wage and other lssues"
$3,192,479, only 4.7%, in gross
nf
revenues
while net income at
e Araffeay 01 railure
$2,042,388 was 42.7% below the
Any realistic appraisal of labor 1952 figure. Nearly 50% of the
Policy and the state of business decline in revenues was carried
through to net income.
for progress and the
While both New York Central
tragedy of failure. This can be and Pennsylvania have made con-

should take into account the pos-

sibilities

dramatically highlighted by con- siderable progress in the last year
sideration of the unhappy devel- or so in their programs of propopments that would flow from a erty improvements and modernili
Gwilym a. Price, "Westinghouse and ernmen+ intervention
You
will severe recession. Where a reces- zation, and have put into service
10, 1952, pp. 6,S9. (Address^at'the IUErecall his references, in his speech S10n 1S both mild and short, and a large amount of diesel power, it
cio Fourth Annual Convention; distribat the 1952 AFL convention and 1S expected to be such, the effect appears
on
the basis of recent
as

pamphlet by the Dole Hawaiian Pineapple Company, Ltd., Honolulu, Hawaii.)

Pennsylvania

consider the prospects for nated by tax loss selling operare1955\ The elec.tloPs wl" no l°Pger tions.
par- provide a barrier impeding stiikes,
Among the poorest acting, ,per^es themselves.
In the election unions will relax their political haps
naturally, have been
the
campaign
Eisenhower
stated: efforts temporarily and again con- st0cks of the large eastern car"Never again shall we allow a de- centrate more
on the economic riers> some of the November repression in the United States." He
The automobile^^contracts sults in this terpit^ry were not, to
supported the statement in these
nhllt linlpc<! say the leastpmspiring. Pennsylwords: "So I pledge you this. If "Jg*take
Vania'
reP°^d .a
the finest brains, the finest hearts,
9
^rn
similar condition°P
$1^857 579, or 13.9%, in
poiicy

There

9,FrrIlL„Wi;«^o^svrTh/e Indivjdual
1952,
5
C °mp'
e'

s„

Henry

ntwc

nmhlnm

and their other severe and prolonged de-

At least one thing was proved
last week so far as the railroad
w:ii up
picture is concerned. Regardless
annual
of the low
to which speculachange in 1954. It is probable,'
*
—" *
"
1
nna
nth^r
"frincfp"
ifpinc
uvc mteresf m rail securities has
nthpr
"fringe"
itpms
tive "ucicai 111 xpii setunucb uas
however, that there will be
,tl
ith
gp' fallen there is still confidence in
changes in the Social Security Act ^"g-ieim conuacis wun. wages the outlook {or selected better
m 'will decrease in number and im- grade rails on the part of the inchanges in the tax structure called p0r^ance both because of uncer- st^tional investors. Illinois Cenaianaaras

—

to

nnnfrnntinn

brought up for Congressional con- -"""j" " AmnuQCtc
sideration, I doj not anticipate any
tfnnrantppH

philosophy that the stockhold- ton can foresee the signs of any
viewnnint
"shnnH
nutwpiVh
recession
and
depression
that

large.

to

the

prs'

anv

1mlnnt,

"whimv f!"rW* ex.'rferrle form ds
n'nHgriJ?!d "a1»cirty in its. pre»e
Sam added benefits, see their ent form could not survive

the stockholder yention in
labor-management
on the totem pole,
lotions more reliance on the

managements would

mituun aiiu leiiuing to an lncreas-

will be of little

temPt t0 influence dramatically
economic trends. Moreover, the
social
Administration is committed to a

makes

Most

nu

settlements

creases

j.

•Kof

♦Un.

ait: nut

.

?°
T^r wJla ?
may p.r.e" siderations not a desire to use
tend." He also indicates a belief siaerations, not a aes re to u

^

rph

?„
to

t

arv

tn

uiiavii.ix.cu,

^
h
influences toward recession will efforts to divert their member- possibilities for real progress. The
s.urY*va. 01 tne Dusiness as be moderate 111 1954, then both ship's interest primarily to politics best efforts of men in all walks of
a g01ng lnsmutl0nmanagements and unions will pre- has always failed. Particularly up life should be brought to bear

w

the stockholder "is that of residu-

!nWd^Lfi
tions If the
of

vkai,

.

unlon minded," as such, but are ing degree toward political action?
thein the union for the benefits they
That 1954 will not pose this
assumDtion

pmn'n a'cfll af Y
not be significantly different in ■
Political action will be
f
^
intensified, and energies will be
that the true status of 1954 tlian in 1953,
tri

business, how

.

the total economy of the benefit

for the company's existence."^

finnk-

in

he
,

know, instances could arise in i-»aDor

us

which

Pn~i

decline

f^ectrical> coal, oil, and others
the economic to the political front progress toward more constructive
XIlvuiveu.
W1"
of
^ore vfeorously resisted and the the prospects are for aindustrial and tried to divert their member- and firmlv based —'
thf prospects are for a year of and tried to divert their member- and firmly based uninn-mana^year
more^ vigorously resisted, and the reiative peace on the
ship accordingly
"Spr0"a'y .'®slstfa' against frnnt on tho on the industrial ship accordingly. The dangers in ment-employee relations, SignfcThe dangers in ment-employee relations bignifire
overriding consideration ana .ln® relative peacea«„mntinn thnt tHo lJz™
°v®"imng consmerauoiv against £
t Qn tbe asSumptl0I, that the this are obvious. In the past, union cant areas exist in which thefe are
increases

"alfof «ie:™nimum wage undervthe Fair

As

mana^pmpntQ and

1954—steel, rubber,

PiPPtr5pni

serious

pros- could the interests of society "in
pects' lose morale. evidence inse- the survival of business and our
curity, and develop attitudes of business system be protected while
"let's Set it now." Unions fear still guarding the interests and

impact ot these changes .
jZ•
in cost and unions will be in a
s gnificance. Pn- somewhat less favorable
position
the mary attention will be focused on
t0 exert bargaining pressures.

has

<«T

tlus:

in

large

Employees, faced

the critical year in labor- existence threatened. Faced with
manaSement relations. Despite the this threat to survival, unions time
many important contracts open for after time in the past 100 years
neg0tiation in

fer

a

t

following

program.

wit!" ""certain or dismal

.^"cte™ fifty-five, not 1954, memberships dropping

business

the

tho

prolonged recession.

survival and possibili-

g

for

a"d. W

policy

a

of

area

relation*

oncost

will

caution

Prospects for the Near

Sachsneand

g^

of

1954 w;u not bring any severe or

decline in business

dictate to management

hazards

wnicn 1 Deiieve 10 De SOUna, inax

■

.

known

.

firmly."ii

rector

cas

labor noliov

,

_

the

forecastine in the TOlatile

Thternn

rPPPSSinn."

a

between

employees, stockholders and
"

?"
to

' '
♦
management

t

,

esponsibihty

.

Despite

'n'°a recess10"seems

PisThTri"

tnmprs
lomers

nf°"gp™fd

tions

jtiP<;

,

Jj^en not of this and have urged
into

.

Gwilym A.

maintain

-

,

?hat we st°P 'talking ourselves

sumers."")
.

"

biuLK-

or

,

possibilities of recession This con- 1
£ern 1S readily apparent and has

a

nature can-

very

r

pressures

upon

job which by its

v

or

"Federal Government." It is in

keeping with the President's expressed philosophy of less gov-

industrial relations should be monthly reports that the work has

ning just as consistently above the
like 1952 months. For the month
of

November alone the transpor-

tation ratio rose to 43.6% compared

with 42.1%

in November

a

year

Actual dollar transportation
costs were cut only $312,411 on a
ago.

dr°P of $3,192,479 in operating
revenues.

For^e ful!J1 P]0nttS' re+lultS

considerably aboveWhile
those

were still

of the similar 1952 period.

increased more
million (about* 4%)
transportation costs were down
$305,481. The transportation ratio
Was 42.1% compared with 43.7%.
while the year-to-year spread
revenues

gr0ss

than

$29

had narrowed considerably since
August there were still signs of
progress for the year as whole.
Maintenance of way and maintenance of equipment ratios were

also reduced slightly and even
though taxes were higher share

earnings came to $4.98 for the
1953 interval. A year earlier t y
had amounted to only $2.71. Anunfavorable comparison is

other

indicated for the closing P1®11
0f the year

and it is now obvious

results will not
slight, and other considerations not yet advanced sufficiently to
earlier expectations.
"miserable
failures"
resulting would be more compelling.
But afford any great cushion in the
oominuc
of
?omeZStneZ ke°vtSw Sent^mbe^'w/nT^ "when government has abandoned consider briefly some of the prob- a
• business. It is Nevertheless earnings of some
13 Herrymon
Maurer, "Boards' of Di-' the role of impartial referee and abilities if a severe recession were indicated that
a recession of any
what more than ^5,0° a
rectors," Fortune, May, 1950, p. 132.
to OCCUr.
lnaiCBiea Uldl II 3 iect&MUii ui . jr
asgured>
Electric

elsewhere, to "the heavy hand of on

Pittsburgh, Penn.) '
12Sidney J. Weinberg, "A Corporation

15 Address at the Hotel Theresa in
New York, Oct. 25, 1952, New
York
Herald Tribune, Oct. 26, 1952.

full

year

government intervention" and the

14 Jackson

that

Liberty Avenue,

Martindell,

Scientific

praisal of Management, 1950,
(Harper and Bros., New York)




p.

Ap138.

,

T+
,

io

rliffionlt

if

not

imnoccihlo

It IS difficult, if not impossible,

to have good industrial relations

Substantial proportions Should de-

^

^

,

velop over the near term the earn

^
HAPPY NEW

1IAr

YEAR TO ALL !

20

The Commercial and Financial Chronicle.

(2644)

John Nuveen & Go.
Now

Buyers' Market in Homes Coming: Geo. L. Bliss

Public

Corporation

a

CHICAGO, 111.—With the open¬
ing of business on Jan. 4, John
Nuveen
&
Co., believed to be
the oldest and largest investment

Utility Securities

President of Century Federal Savings Association of N. Y. City

:-

also

The

United Gas Corporation

months

as a corporation for the
first time in its 56-year history, it

rperating

announced

by John Nuveen,
of the Chicago firm
established in 1898 by his father,

housing shortage in the

Officers of the

and its subsidiaries and three-quarters

company

the late John Nuveen.

e

builders to

was

and

Vice-Chairman of the Board; C. W.

mineral

President; Frank C. Carr
and
Fred
B.
Carpenter,
VicePresidents, and Walter R. Sund-

and Treasurer.

Lng, Secretary
Mr.

'

Mr.

Howe

and

have

600 oil

been

tofore

Laing here¬

partners in the
Carr, associated
with the firm since 1936, has been
Manager of its underwriting de¬
partment since 1950. Mr. Carpen¬
ter, formerly a Vice-President of
Barr Brothers & Co., New York
investment banking firm, became
while

.firm,

the

a

tional

Bank

Trust

and

Company
of Chicago, has been with the firm
since

1940

Cashier

its

and

since

1945.

In

addition

in

headquarters
.South

Salle

La

offices

tains

the

to

Chicago

in

135

main¬
York City,

New

Boston, Cincinnati,
Los Angeles.

at

it

St.

Paul

and

born in Den¬
parentage in. 1864,
was one of Chicago's colorful fi¬
nancial figures.
He was brought

business.

After several years of
experience in merchandising, real
estate and mortgage banking, he
began
his
investment
banking

business

in

capital.

It

financing

century
process

$50,000

than

founder of

after

at the turn
relatively a

was

the

the

of

died

firm's business

lation

and

these contracts

in

wealth

United

are

25-year contracts

produced from wells in the Gulf of
The reserves under three of

gas

have elapsed) with
to 13 xk cents for the last five years.
years

Corporation, the parent

company,

suc¬

sales

(or

Industrial sales by the Pipe Line System include large
power

The earnings record on the common stock has been as follows
on

shares:

average

Parent

12

Months

Ended

June

of

the

Consolidated

Company

to

in

formerly

B.

as

funds

__

_

terms

gage

will

will

require

before

Minority Interest

__

proof

3,213,000

final

In

sold

in

mg

shortage

a

Never

about

100,000

shares of its holdings.

connection with the latter

The

formation

Rosenthal

A

GROWING

the

of

Company,

National

curities

The prospectus

contains

sale

NEW YEAR

Charles

member

Association

Dealers,

is

more

exact

and

underwriters

39

of

of

of

before

on

P. O. Bo* 899, Dept. K, Salt loke
City

Se¬

as

dealers

investment

Broadway, New York City,
a

branch

office

at

55

West

request
10, Utah




has

there

It

is

issued

and

of

more

Midwest

Stock

nounce

42nd

thal

Street.
was

curities

Charles

M.

Rosen¬

appointment

registered

Mr. Tague

in

up-

some

homes con,
1,100,000

1952

has

1,131,500
1,091,300

____;

1950

twice

the

volume

of

931,600
849,000

.____

670,500
8,195,000

N

any

h

of

_

homo

morteafrps

home mortgages

volume

commercial

1953 (estimated)

in

was

3,240,000
3,028,157

1952

1951

1950
1949

banks

2,877,860
3,032,452
J_ 2,487,521
2,534,702
2,566,632
2,497,122

1948
1947

types of lenders at $3.2 billion.

is

not

on

the

units

,

Bliss.
of

+.

necessarily
,

number

1946

22,264,446

de-

Z

of

constructed,"

-n*

said
that

reveal

five families

n

Dollar

new

"Statistics

*

i

(est.)

1951

home

a

or

owner

refinancing

1950
1949

financing
house, whether

means

of

i'

u

home
(

1953

1952

of

r

volume

mort-

rprordpd-

^

moves

every

re-

coraea.

home .mortgage
for

1,396,000
1,025,100

___!

-

every year, and usually each move

With

—

;

$20,200,000,000
18,017,677,000
1-3,405.367.000

-

16,179,196,000

of

1947

11,828,001,000
11.882,114,000
11.728,677,000

the lending volume in 1953, better
two-thirds of the mortgages

1946

10,589,168,000

old

or

new.

a

Since

counted for not

and
an¬

recorded were

new

more

homes

than 34%

1948

ac-

than

Exchanges,

sentative.

of

W.

repre¬
•

Mr.

previously asso¬

Bliss

on

existing houses."

estimated

the

result

in

another

$20

$116,830,200,000

home

mortgage credit demand for
will

1954

Wew Investment Firm

billion

In support of his prediction
that there will be a plentiful sup-

(Special to the financial chronicle)
NEWTON HIGHLANDS, Mass.
Company, Milwaukee,
as ply of funds to meet the demand, —Investors Planning Corporation
wholesale representative and prior he
pointed out that loan repay- of New England Inc. is engaging
was

ciated with the Wisconsin Invest¬

year.

ment

formerly with Miller Se¬ thereto

Company.

the

Edward Tague as

f

1948
1947
1946

business

York

result

1953 (estimated)

1949

nonfJo

New

ratio trend is

will

demand.

strnrtPd

year.

more

pendent

the

replacement

"The record volume for the year
shows clearly that the mortgage

Co., 231 South La Salle Street,

members

in

siruciea*

first

financing

home

the

homes than any other

ous

CHICAGO; 111.—John J. O'Brien
&

^

with
BOOKLET

decline

for life insurance
companies at
$1.45 billion; for savings banks at
$1.35 billion; and for miscellane-

John J. O'Brien & Go.

M.

securities will have its main office

RESOURCES

which

ward,

lion; for individuals at $2.9 billion;

ALL !

TO

W. E. Tague

announced.

The firm which will act

at
AREA

"The vacancy

mortgage

above mini-

and

prevailing prices,

1951

The

Recently, Electric Bond and Share

Formed in New York

WEST

at

a

1953

August, this year, outstanding shares were increased 10%

G. M. Rosenthal Go.

COMPANY IN

of

year

a

expansion

mum

needs

tremendous volume of

that

one

"iMiHHHinrumiiiH»iM

will

'

0.6

100.0%

of

My view is
were groundless.
that the only way builders can
New records have been estabkeep up their volume of produclished in 1053, both in the number tion
and attract buyers is to iq)of home mortgage recordings and
prove the quality of their houses
in the total dollar volume of home
and lower the sales prices."
financing,' he continued.
"Final
The following tables, prepared
figures will disclose that approxiby ]yrr. Bliss, show the tremenmately 3,240,000 .home mortgages dous volume of home
building and
were
recorded in 1953, with the home
financing in the eight postdollar volume of these mortgages
war yearsaggregating approximately $20.2
Number
of
new
home_
con_

Mr.

IDAHO
WYOMING
COLORADO

said

1953

that ' the wails of the buildindustry
in
recent
months,

housing

GROWING

Bliss

statistics for

prove

about

eight

(h°™ con-

housing units

other type of lender."

41.5

$524,358,000

HAPPY

A

fi-

type of mortgage lender, with approximately $7.5 billion placed in
mortgages in 1953, increased their
volume to 37V2% of the total home

detailed information than the summary given in this column.

u mil umm hi H
nun hi i

Mr.

the

average

.

'

home

estimated by Mr. Bliss at $3.8 bilTotal

by the sale of 1,171,863 shares.

UTAH

salability

the

on

in

an

struction at the present rate or of
lenders to provide the
!lef ssary financing. The problem
is h°w "?V
if
ket be able to absorb 400,000 new

"Savings associations, which fi-

G.

Phillips & Co.

Serving Jn

of

or

e,rs 4°

advancing funds.
situation,

that

nance

57.9%

217,409,000

__

Common Stock Equity_■__

stable

mortgage business for the year, or

$303,73-3,000

new

1953," he

better than 400,000 units a year,
above
the minimum
expansion
and replacement needs. There is
no question of the ability of build-

inai-

...

single

0.8

million

1.1

supply

postwar years,

the

Mortgage lenders, he said, are
likely to be cautious in financing
housing developments, and

about

Total

the housing

mort-

and

reached the $20 billion mark in

16.2

estimated

"An

new

time

3,918,000

Miscellaneous

Loans,

home

remain

1.71

85,000,000

_

_

and

causes.

through 1954.

lending.

$214,818,000

_____

Debentures

and

con-

available

mortgage

40.9%

hGmes

houses

Mr.

will

assured,

1.43

follows:

Mortgages

securities business.

with

of

volume

for

is

a

System capitalization is

with

units have been built in

cates that interest rates and mort-

billion.

been selling receptly around 28 (range
30-23 V2). The current dividend rate is $1.25

date

approximately

Street, New York City,

He

funds

been such

Gas Corp. has

this

George
M.
Rath
has
formed
George M. Rath Co. with offices at

of

credit

gage

1.57

making the indicated yield about 4 V2 %.

Geo. M. Rath Co. Formed

to engage

supply

however,

1.40

underwrites

replace

a

1.63

1948

year

at

1.19

from

every

added,

1.56

—

not

continued, "making a total of more
than 8 million units that have
high rate* in 1954, but been
constructed in the eight
the number of units built may be 'postwar years.
This means that
"about 10%"
below, the 1953 fig- American industry has added more
ure.
He indicated that a plentiful than 3.2 million dwelling units to
New

Bliss

1.23

1949

United

home construction,

is

homes destroyed by fire and other

1954.

1.15

________

worn-out

fore-

in

$2.05

Year—

1950

United

in

$1.42

1952
1951

in¬

stated

year

to

Savings

trends

1.32

Calendar

1953

30,

during the

the

Fed-

tiiy,

distributes gas

house fuel and sales to pulp and paper companies,
oil companies, synthetic rubber companies, miscellaneous indus¬
trial companies, pipe line companies, etc. United Gas Corporation
is active in industrial research both in its own Shreveport labora¬
tory and (in cooperation with Electric Bond & ..Share and the
National Research Corp.) in Cambridge, Mass.
based

Presi-

probable

York

casting

There

the, minimum need is for about
600,000 new dwelling units a year
to -supply new families formed

L.

Association,
New

Commenting

Texas, Louisiana and Mississippi, but the revenues
from this retail business are only about one-sixth of total system
revenues.

on

of

eral

Bliss

„

in

retail

at

(of which about two

Gas

Bank

a

miles of

9,100

estimated

are

increases up

1948

volume

about

owns

by Ralph E. Davis at 3.4 trillion cf.
of gas under these contracts approximates 9 cents for the

The cost

investors, principally banks, insur¬
ance
companies and individuals.

was

Company

purchase agreements

Covering the purchase of

The

state in the Union and distributes
them
nationally to conservative

Broad

Line

growth of popu¬

States, and it now
municipal securities

50

Pipe

Mexico, off the shores of Louisiana.

ment business for 50 years.

The

Gas

L

George

tinue

the next few years.

simple

exception.

the firm

1948 to 8.3 cents in the 12 months ended June 30,

Included in the gas

the rule

were

than 490 gas purchase contracts. The average
mcf. purchased from nonaffiliates has increased

from which gas is available) are estimated at over 32 billion cubic
feet, of which nearly 24 billion are considered recoverable under
present economic conditions.
The latter reserves are available
from a total of 268 fields in Texas, Louisiana and Mississippi.
Owned reserves (included in the above) exceed 4 billion feet.

participating in the invest¬

creased with the

over

United

cessive

Bliss,

billion.

Commenting
on
his
forecast
that the home building industry
must face a developing competitive market, Mr. Bliss said that

hands,"

dent

$12,425

-

unsold

George

balance from non-

to

rows

their

antici-

net increase

a

likely to be any tremendous drop
in savings in 1954, he added,

avoid

Century

pipe line, 39 compressor stations and six gasoline extraction plants.
The system's total proved gas reserves (in place under properties

and municipal bond issues

of less than

rather

with $22,000 of
observed that pub¬

1898

was

the

to

houses
illli!

buys nearly one-quarter of its

Producing and

Union

if

Qj

located

1953, and it is anticipated that the average costs will continue to
increase

mark of Dutch

here at the age of two by his
father who established a dry goods

is

acreage

more

per

first ten years

The elder Nuveen,

lic

gas

from 3.7 cents in

company's

Street,

of

cost

The

acres.

wells, together with additional wells of various types.

affiliates under

Sales

Manager. Mr. Sundling, formerly
with the Continental Illinois Na¬

1,724,000

leases

requirements from

firm

Nuveen

in 1941 where he has been

and

United Gas Pipe Line Company

Mr.

with

associated

fee)

in-

having

the

meet

necessary.
In 1953, he said, net
additions to long-term savings will
approximate $13 billion, and in
the previous year they amounted

builders

want
„

principally in Texas and Louisiana, with smaller holdings in other
southern states and some holdings in Oklahoma, New Mexico,
Montana and the Dakotas.
As of June 30, Union Producing had
full or part ownership of about 900 producing gas wells and nearly

Laing,

dollar

the

almost

Hoard of Directors; L. L. J. Howe,

a

vested,

per

purchased.

to

of only $7.5 billion in 1954 in longterm savings is all that will be

greater value

outstanding securities of Union
Producing Company and of United Gas Pipe Line Company, and
three-quarters of the capital stock of Duval Sulphur &
Potash Co.
Union Producing owns about 61,000 acres (in fee or

corporation will

figure

order

pated credit demand

way to give
home seekers

HfUPlUfHI

United Gas Corp. owns all the

John Nuveen, Chairman of the

that in

na-

"sharpen their pencils

commercial, 40% industrial, and 45% wholesale and miscellaneous.
Of the total gas output, about one-quarter was produced by the

senior partner

l

integrated natu¬

systems, with annual revenues of $192 million in the 12
ended June 30.
Of this amount gas sales accounted for

gas

a plentiful supply of mortgage funds.
Gives
building and home mortgages for last eight years.

home

on

tion is passing and a buyer's market is developing that will compel

78%, crude oil and gasoline 8% each, and net sales of sulphur and
potash 6%. Of the gas revenues about 12% were residential, 3%

United Gas Corporation is one of the largest
ral

predicts

data

By OWEN ELY

funking firm in the United States
rnderwriting and distributing mu¬
nicipal bonds exclusively, will be

v/as

.rThursday, December 31, 1-953

was

Co., Chicago.

with

Cruttenden

&

ments in. 1954 will make available

in

approximately

fices at 110 Upland Avenue.

$12.5

billion,

so

a

securities

business

from

of-

Volume 178

Number 5286

The Commercial and Financial Chronicle

...

's View oi 1954 Prospects
By PAUL EINZIG

(2645)

major recession, should occur dur¬
ing 1954. There may be a minor

recession, and
to

ment

Dr. Einzig indicates there has been

appreciable

ward normal conditions in world
economy,
tions that 1953 would

restoration of

see

for

but notes expecta¬

in

Looks for little increase in

most

reserve

"witnessed
towards
in

the

appreciable

world

progress

normal

more

economy,

1953 "discrepancies ^between

year

conditions

though

even

that
fell

short

of

optimistic

ex-

that

the

in

1952—near

markets is likely to follow
contraction of demand in the
domestic

The

market.

an

improvement

all-time peak, rate of return of the railroads'
but 4.23%. Reveals another record in rail¬

was

road operating

setback in many

a

How-

it is possible that the extent

ever,

this

0f

countries.

will

factor

be

mod-

very

erate.

1953

Spokesman for railroad industry reviews rail operations in past
and notes, although net income is estimated at 9% above

year,

the

net investment

othghr^hand, widespread

expectations.J.lSat

competition

price non-Communist

normal conditions.
Qn

bal¬

increase

efficiency, and states lines intend to continue
at highest l^vel the traffic and earnings

programs

will bear.

logical effect of a recession in the
United States would be felt in

and unofficial quotations must be
regarded as a step towards more

progress

their

An

countries.\ Moreover, the psycho¬

««=■

.

doubt,

payments.

result would be

important factor in

_

Beyond

President, Association of American Railroads

any

world economy today is the U. S. business outlook.
_

By WILLIAM T. FARICY*

depend

world

American

Sterling Area gold

1954, and concludes by far the

which

equilibrium of

of

American

of

not realized. Says
uncertainty of U. S. business outlook
impelled British Government to adopt a cautious policy in this

countries

the

ances

sterling convertibility

were

matter.

to

How the Railroads Fared in 1953

embarrass¬

their exports to the Dollar Area

on

to¬

progress

that is liable

even

considerable

cause

would

see

the restoration of the convertibil-

.

,.

Results

.

in 1953

trade and finance will
depend largely on the extent of
the recession in the United States.

of

railroad

_

were

in

In

of

cjes

sterling.jmd other

curren-

slump did not
materialize

tt

or in

Pro-

duction

fig-

Lnuig

which

showed
a
setback in many countries
1952 recovered

improve

appreciably and

ih m"Ky in,?ta"ces thay exceeded

setback

due

construction.

Looking ahead to 1954, the rail¬
roads

essential

in
American
business,
Should the American business po-

those for 1952,

0f the

sition

the

reserve

as a
the price of

the

0f

fall

in

the staple exports of

remain

substantially

un-

changed there

may be some further progress towards the removal

Sterling Area of

quantitative

restrictions.

Moreover, the uncerThere may be some adjustments
tainty of the business outlook in of exchange rates, but there is no
United

British
1953

States

impelled

Government

cautious

policy.

to

At

the

adopt

the

of

end

convertibility annearerl

a

to

hp

to anticipate
devaluations such as

large-scale

reason

nessed in

1949.

n&v-

to

have

were

wit-

The French franc

be

devalued

although
weeks

eventu-

million

is

about 10% bethose

the

in

pe-

William

T.

Faricy

expected

to

be

dollar

-

though

1952.
are

possible

out

lion

These lower loadings

f

thus

turn

of

same

rj0d

are
already programmed
improvements of all sorts. It

for

running

iow

their

and
earnings will jus¬
Expenditures of about $800

tify.

they

year

continue

revenues

the

of

to

improvement program at
highest level which traffic,

the

in

closing

were

countries.

the

intend

slightly above

opments

Sterling Area gold

gain in the freight car fleet
25,000 units. In addition,

devel-

adverse

to

their balance
of payments position. The increase

resujt

any other

ures

in

to

t

country.
faui

able

G'+ jlnot
slowed down in 1953 largely
States

United

Ur.

ei-

be

a

net

large numbers of cars received
heavy repairs which, in many in¬
stances, amounted to virtual re¬

failed

Britain and other countries would

post-Korean

^

were

of about

passenger

trattic and
£,e Y ® nues^^materialize. They Removal of trade barriers and re- * reight c a r a
negative were based
ofi-junwarranted opti- taxation of exchange controls can- loadings for
s e n s 0
*J1 0
much-dreaded mism about the extent to which not continue if there is a risk of the year were
pectations

many ways.

and

80,000 new freight
installed during the
year. Since some 55,000 old cars
were retired, the year resulted in
cars

a

nearl.Y 7%
!n

.

,

operations electrics

strikingly similar, in
most aspects, to those of 1952.
There wasL however, a decline

Continued liberalization of international

21

the

that

in

year

level

one-bil¬

this

of

field,

traffic

condition

the

n®cessarily conditi

e lowo£ loadings are expeciea of

will

1954

another

will

extent

capifai spending.

n°art oY 1954 ^

6
Both passenger and freight traf+.
fic. continue to be affected to an
net income for the undetermined but substantial extime progress was made
during
No Convertibility in 1954
There is no reason to anticipate entire year rose an estimated 9% tent by the continuing application
the past year towards the relaxaThere is indeed no reason to a substantial
recovery of gold af^ <?(SS,r0a?
Federal excise taxes amounting
tion of trade barriers. The
quan- expect that 1954 will
witness the ter its recent decline in the free \he all-time high net of $902 mil- to 15% on passenger tickets and
titative
restrictions
on
imports, return": to
convertibility.
When markets.
In all probability the
indJstry eain0 3% on freight charges. These
imposed by many countries under
the Commonwealth Finance Min- sales of Russian gold
xwill con- m ?942t?xes are highly discriminatory in
the
influence of the balance of
isters meet at Sydney on Jan. 8 tinue,
and this factor itself is Foads m 1953 had to take in $3 that they are collected only from
payments crises of 1951-52, were
jt is to be expected that Mr. But- likely to be sufficient to
prevent I31 ll?^lr?!ore °f gr°ss revenue than those who use public for-hire
materially reduced both in Europe ler wi3a not
hoid out for them the development of a substantial 10 1942 in order
}° ™ind "P Wlth transportation and not from those
and in the Commonwealth.
The much
hope for an early imple- premium. Hopes of an increase of the sam(: ar*10unt °t nep inc°me. using their own cars, trucks or
United States Government
suementation of the Commonwealth the official American price have
**ate of return on the industry' s barges. The taxes thus encourage
cessfully resisted pressure in favor Economic Plan.
The prospects of now been abandoned, at any rate jet investment of more than $2b Use of private transportation and
of a higher tariff wall.
the Sterling Area balance of
pay- as far as the near future is con- t
^ou.n eJQ,o0 4.23%
up ^discourage use of railroads and
Even though claims that world- ments
are
not
sufficiently en- cerned.
from 4.h>% in 1952 and lough yj other common carriers,
wide inflation was
brought to a couraging to justify hopes of a
During 1953 inflation and defla- tl9ua*
e ear?ed .10
^
The additional problem of union
halt in 1953 are unduly
optimistic, substantial increase of the gold tion was running concurrently.
Postwar years of 1948 and demands for wage increases and
there can be no doubt that the reserve
during the year. :As far The fall in' raw material prices
J,
'
enlarged fringe benefits which
upward
trend which
had
been as Britain is concerned the
rising had a deflationary effect, but this
Railroad freight traffic, esti- aggregate staggering sums conthe

fr®.01*1

figures

slight extent.

some

for

At

1951

the

]ess

imminent

than

it

did

12

to months earlier.

same

ally, even though the efforts to
maintain it at its present parities

.,

^

'

,

Railroad

WB1 continue.

.

,

~

<

.

..

proceeding almost without inter-

„

,

...

.

w,

..

did not prevent the expansion of ™at°d at 610 billion ton-miles,
ruption since
1939
was
slowed German
and
Japanese competi- purchasing power through higher declined fractionally below t a
down in 1953.
Postwar inflation tion
rule
out
the
possibility of wages and social service benefits.
™,e Preceding year, w He
is not dead, but in most countries
any sharp increase of exports.
It These
contradictory trends are Ip1
a5
cllmfr°d a°oy
it is under control.
The rise in will be an effort even to maintain likely to
continue during 1954, J
? + oo onn nnn^t
the cost of living in Britain and
existing markets.
At
the
same
unless the business recession in to stand at 38,300,000 at the end
many
other countries was very time the increase of domestic pur- the United States should assume ? A?e year* A moderate decline
moderate compared with the rises chasing
power
through "higher such dimensions as to enforce an in tJle avera®e
ireignt actrend

of

wages

and

the

.

«

,

earlier

Raw

postwar

material

constituted

neritv

a

and

wages

years.

shortages

grave

which

threat to prosthree

nrogress

vears

ago,disappeared almost completely
in 1953, so much so that towards the
end

of

December

it

became

pos-

will

ports.

As far

tend
as

to

the

stimulate
raw

im-

material

producing members of the Sterling inflationary spiral of
Area

countries

are

concerned,

depend on the trend of raw mateprices and on the business

sible to terminate the international

trend

arrangements made in Washington
in 1950 on the occasion of Mr. Att-

marked

There does not
likelihood of

a

seem

to be

any

return of exchange

fluctuations in

1954.

The fashion

are unknown factors, but it would
be unduly optimistic to expect any

lee's

wages will

continue to operate.

their balances of payments will
rial

visit to

gency.

plies

in

cope

with the

emer-

There are now ample supalmost every kind of food-

stuffs

and raw materials, including coal and steej. Even sulphur,

the United States.

in

improvement

in

direction.

Both

0f
advocating a return to the
"floating pound" seemd to have
passed, and neither Britain nor
either other countries are likely to abandon exchange stability.

It seems, therefore, that insofar
as the return to convertibility de-

able to expect a reasonable degree

pends

^rtationTe^icT""1
porta tion service.

„

,

ma-

a

<(J

reversed for

though this
aid

have

which

remamed

Another

sense

time,

dollars

even

distinctly

in

would
scarce,

which conditions

a

it

On

the

whole

it

seems

reason-

,

.

.

.

ords^^udiig^he^a^in^veral

nrocedur^'

Mder^ihe™RaHwav

Labor

have

Gross

revenues

totaled

sro fffi milhor- uriy^roTer
L+ vLfs total This record

was

offset

sonfe

t0

extent

however,

bv reCord ODerating expenses and

^ Lx ifayments

between
price
in

the

official

American

of gold and the prices quoted

the open markets—even though

there

remains a

con^Honr
command
hnllion
bullion

eoTfoins
Dremlum

a

valjip
vaiue.

matter for

reduced premium

and

over

Althmmh
Although

it
it

stn

their
is
is

a
a

argument whether the

be

opposed

to.

rities

business.

Officers

are

Hu-

the

granting of
large. scale financial
assistance,
and a iowering of customs barriers
w0uld be even; jess popular.
By far the

y.

mated

at

billion

$8.1

and

extent

.

.4

c

^

Transmittal Serv. Corp.
NEWARK. N.

Tn

financial

the

railroad

ooerahons

of

outcome
in

the

new

procedures,

pk||o

Acc

xpAC

■■■■«■
dole

NotAf

UCIO

HCff

PHILADELPHIA

II

11
Qlola
OldiC
Pa-Ray-

mond EGroff of Brown Brothers

cilities,

making

J. —Transmittal

1953
the sixth
in which railroad

capital investment has topped the
billion

-

dollar

spending

for

mark.

capital

Railroad

Qroff

wbose

E.

of

term

nnminpfpd

1

T

T

'
~

'

•

Jr

&

x

T,;nu,,

r

wprp-

r;

TreaQiirpr

Tr

'

nf

TVmvpr'
"Rnh-

c««rptarv

®a J,1

nf

Tr

A.

Co.,
;

exoires.

t

,

Clark

W.

nffinetre

t

William

succeed

would

Lacock

Harrison

&

^ K Daffl0n' Jr> ot HamS0I1'&
^°*

;

,

*

The following were nominated

improve-

world^conomy

||ineSS outlook.

United States
A engage in a securities business, lion.
^
3rd of Wright, Wood 4 Co., Franmajor Americarj-ilump would in- Officers are E. W. Thorn, PresiE«uiPmirlt Pur=h?ses continued cis M. Brooke, Jr. of Brooke &
evitably result'#n a worldwide dent O H Hartfield Vice-Presihighlight capital expendituies Co .
jacoby and Mr. Gies.
t

economic
fect

Qn

crisis-%wing to
exporJC to the

states.

Forfunatjly

price the virtual disappearance of

that

major

a

its

United

it is unlikely

r^ump,

or

even

a

"arttield, Vice-Piesi-

'

ef-

dent> and Denny Eisner, Secretary,
Mr-

Eisner

was

previously

Sutro Bros. & Co.

P

a

The'outcom"
these

of

railwa^

other

taxes

industry through its far-reaching
postwar improvement program.
That
program
was
continued
through
1953
with
scarcely
a
pause.
The railroads spent more
than $1.2 billion during the year
on new equipment, plant and faconsecutive year

^

the

to

as

lr^niynt!^

hhnr

1

ex

n^t important fac- Service Corp. has been formed ments since the end of World War for the Governors to se^X° J°r
is
the with offices at 790 Broad Street to II now totals more than $9 bil- three years: Spencer
^ Wright,

official American price is the right




hausted

been

not

excleded ^

which
other peacetime year,
operating expenses are esti-

those of any
Total

Act

SsHSSsS

pared to support a return to con- bert K. Ladenburg, President, and
have become more normal during
vertibility
to
an
extent
which Eva Ladenburg, Vice-President,
the past year is that the premium
WOuld justify the change in exist- Mr. Ladenburg was
formerly with
on
gold in the free markets has
jng circumstances. Congress may Sutro Bros. & Co.
disappeared. For all practical purposes there is now no difference

per

categ0ries

„

satisfactory balance of payments investment
Corp. has been formed
cannot have safe foundations.
with offices at 2606 Thirty-sixth
js ^ certain by any means Place, N. W., to
engage in a secu-

that the United States will be
pre-

additional

an

hour,

„

due to American

was

without

some

for

increase of five cents

wage

of

on the inherent strength of
Sterling Area there is no rea-

the

bws»-.b«rassrarasa?jsws
came

resenting about 10% of all rail-

way employees,

" ice. The Irnrl^L Tf^rnl WW
h^Thl5 piocesses of collective

stability and prosperity during paid all levels of government at
the year. It would be unduly op$1.3 billion.
jor
industrial
"bottleneck"
for son to expect that the situation timistic to
anticipate any specAnother record was set by the
many years, is no longer in short will change materially for the bet- tacular
improvements,
but
the industry in the field of operating
*uPPlyter during the year. In fact the chances are equally against any efficiency. The amount of transAbove all, the perennial "dollar
possibility of some degree of de- marked relapse.
poration service performed each
which threatened to remain

16, 1953, a settlement was consummated with the trainmen, rep-

and an additional week's
all-round deflation in other coun- counts for the paradox of greatei vacation
with pay
(a total of
tries.
The chances are that the carloadings coming during a pe- three weeks) for those employees
,

in

ironts the railroads as they enter
1954. By agreement dated Dec.

growing

with

in

1953

More

locomotive

units

2,000 new
most diesel-

than
—

The

.

annual
the

tion
*

Year-end

1953

statement

Railroad

by Mr. Faricy on

operations.

of

,

TTriHnv

,

,

...

meeting

Tan

22

held Friday, Jan. I

.

a

and

Association

-

elec¬

will

be

-

22

The Commercial and Financial Chronicle..

(2646)

of

further

the

in

of the

circumstances.

the wonted activity to this branch
And the answer, nine times out of ten,
further pumping of money, or its equivalent,

more

purchasing

into the hand

power

means of stimulating business. The
of the New Deal notion had been to increase gov¬

essence

system.

suppose

—

a

putting
people as

One would

that work or pro¬
duction was an end of itself
an excellent thing to be
cultivated and encouraged quite regardless of whether any
one needed or wanted the things produced.
If only some way could be found to introduce a little
more rationality in this business of
eliminating depressions
or of reducing their severity!

general idea is that it would be a good
thing to leave more purchasing power in the hands of
the rank and file. This, of course, is a variant of the old
the

the

into

The Senator's

notion of

no one

economy?

involves

The Senator's Prescription

■of

or any

How may we restore

general direction in certain

same

residential building,

long list of activities begin to decline, and

a

stops to inquire whether a slackening of the sort is good
or bad, sound or unsound.
The question at once becomes:

We It
See

As

Let construction, or

business.

Continued from first page

ernment

expenditures, and thus distribute funds among
the rank and file. Some schemes of this sort contemplated
the

possibly by sale of government obligations of funds
being hoarded throughout the land, particularly perhaps
by the wealthy, who, so the reasoning went, would not in
the circumstances then existing proceed with business
ventures as the political managers believed
that they
should. The present ideas of Senator Douglas at least haye
or

Continued

from

cisions for them.

.

But the matter is not

simple as generalities
such as these would make it appear. The proposals of the
Senator gain immensely in importance by reason of the
fact that they in essence have ardent supporters in many
directions—supporters, as a matter of fact, not only among
the Democratic minority and among the so-called liberals
of both parties, but in Republican quarters where New
Dealism as such is roundly condemned. No one is likely
to regard Congressman Reed as a New Dealer or as a
Fair Dealer; nor is he to be classed with the ordinary
radical or even a "liberal." Yet, whether he himself fully
realizes it or not the reasoning behind his insistent and
almost perpetual demand for tax reduction implies very
much the same conclusions as those which appear to impel
Senator Douglas. In fact, the general idea of priming the
pump by reducing taxes rather than increasing expendi¬
tures appears to be
gaining adherents daily in political
nearly

circles.

so

—

Of course, some of these adherents are not

what taxes

are

reduced,

or

at least

particular

interested in

are more

reducing taxes than in the selection of taxes to be reduced,
others would give the low income brackets the
benefit of all or
virtually all reductions while leaving the
rich soaked as
severely as ever if not more so. Still the idea
of increasing the deficit
by reducing tax collections rather
than enlarging expenditures is common to most of them
—perhaps all except those who manage to convince them¬
selves that by broad reduction in tax rates under
present
while

condition^ tax collection would rise rather than fall.

Business Level Can Be Maintained

new

are

seems

to

this

only

can

growing

mean

long-term business for you.
Well

attack upon

has

real danger resides in this
fiscal soundness. Mr. Reed, so far as we
shown

great deal of interest in
curtailing expenditures—at least no interest in any way
aware,

never

a

comparable to his desire to reduce taxes. Senator Douglas
is hardly to be
compared with Senator Byrd as a devotee
of prudence and
good sense in the management of national
finances. Many of those who
the

now

bandwagon of tax reduction

would gladly climb

families

have

such

in

a

sub¬

income

had

increase

dur¬

ing the past decade that they are

particular

be

appear

to

care

hardly

a

fig about the magnitude of public outlays. In fact deficits
seem

to attract them

as

one

means

of

combating

their recent

on

As

long

well

inflation)

as

a

means

inducing prosperity and wellbeing. In one respect, however, this campaign for further
inflation—if campaign it is to be termed—has a new twist.

to

seems

to work

the

up

we

are

to

proceed to inject

system every time

fear of bad times,

or

we

more
are

in¬

able

accurately when

more

political powers that be
work to their

to

this

begin to fear bad times may
detriment, when can there ever be any end

internal

blowing

up

of

our

monetary and credit

system?
The
fact that
the

matter

is

of

greater

essentially this

great majority of




same

concern

by

reason

of the

infirmity is to be found in

the remedies for

a

downturn

in

million. The

ing to the
seems

months,

forecast

hold

to

buying

levels.

Moreover,

shows

even

that

tions

in

in

spending.

families
both
to

generally

to

down

insofar

willing
currently and

accumulated

protect

to

living

income

as

imme¬

not

are

less

save

draw

ings

will

proportionate cuts
This
is
because

cause

sav¬

standards

losses

seem

ahead, the ice still

year

firm

to support a
optimism for

enough

of cautious

1954.

experience

moderate reduc¬

income

diately

be

can

close to present

executives
But look¬

and American families.

War

II.

comparision

with

War

increases

in

five

II.

The

second,

fairly substantial mortgage.
"How
a

can

very
come

be

we

get

more

room?**

pointed question which
up in dinner table con¬

every
day in homes
America. The answer must

found

in large part
through
improvements to existing homes,

with

agree

you

my

not, I'm sure you will

or

share my view that 1954 will wit¬
\ ness

in

intensive

more

sales

financing

generally.
that

tend

it

business

will con¬
is already

you

competition

that

keep

so

competition

and

Many of

hardly

can

get

why get concerned fur¬

worse, so

or

already

space

adding

on

one

or

But

rooms.

is not nearly as easy as
buying an
automobile

or
major
appliance
through the channels you people

established

ther about it?

well.

so

doubt, the principal

reason

why families have not "fixed-up"
their

homes
the

over

not

more

fairly

substantially

is that

years

known

how

sizable

to

they have

finance

the

expenditures

re¬

quired without wrecking the fam¬
ily budget.
"A Rising Ground

There

is

Swell"

rising ground
swell "to do something about
it,"
and you people have an important
stake

Whether
forecast

in

now

the

a

outcome.

Here

is

a

private credit need—will it be met

by

private

.met,
and

means?

that

so

become

If

it

be

can

badly needed

related

space

home

improvements
easily attainable, it

more

seems

almost

major

household

certain

that

many

items—of

con¬

siderable interest to you—also will
be purchased in due course.

Most families cannot hope to
certainly is nothing which
finance major home improvements
you about your imme¬
longer rising, and in fact shows diate competitive situation which easily on short-term money, but
need some sound method of add¬
some slight contraction as at
pres¬ you do not already know much
ent among workers who have lost better than I. However, I'd like to ing to their present mortgages. In
few
comments
about
a
fact, if the "add-on" or "openovertime pay, families do become offer a
increasingly "choosy" about what change in the nature of competi¬ end" mortgage principle is not
tion which is rapidly taking place. more widely adopted in "fix-up"
and where they buy.
They are
much more interested in compar¬
Usually when we speak of com¬ financing in the fairly near future,

temporary.
When

There

purchasing

ing

values

and

more

not

will

hinge

a;

buy

often

no

than

decision

>

to

the kind of service offered

on

at the

time of sale.

With

after-tax

record

farm

is

power

income

still

at

and

few

a

scattered

obvious

record

Surveys

that

most

still

can

buy at

rates—if

do

they choose to
spending in¬
tentions indicate that they expect
so.

to

buy

of

heavily—but

be

"sold."

as

they

must

consumers

Rightfully, they feel
they
are
"king"

again.

once

Almost certainly they
the bulk

make

chases

only

of

where

their pur¬

they

receive

Greatest Single Challenge

Here is the greatest single chal¬

facing

American

year

ahead—how

the

vert

business
to

con¬

buying potential, close to
record level, into actual

a

1953

sales

and

business

goods
to

of

profits.
induce

—

to

specific

a

competing

companies,
there is no reason
guard about them.

certainly

lower

our

Can

American

the

public

—

continue

to

spend

in

business has taken

broader

on

much

a

form—everybody
or

is

get¬

enlarge

of the consumers' dollar.

Automobile

and

dealers,

example,

for

floor

covering
longer

no

compete solely with others in their
immediate

own

present levels?
Failure
capitalize fully on the huge

with

real¬

not.

or

Because

of

the

heavy

stake

which you people have in financ¬

recent years,

ables,

despite huge outlays

and other

cars

shelter

has

assumed

family's budget.

ing

and

represent
of

aver¬

operations

largest single

expenditures

city

in¬

Today hous¬

household
the

dur¬

consumer

creasing importance in the
age

potential

that

is

families

made
across

seg¬

by
the

nation.

In large part, this trend reflects
the presence of record numbers of

still

next

3-5

always critical in business, but
the period just ahead will be un¬ additional
units and

usually
because

important

by

in

mid-1954,

this

regard

we

should

ing

millions

W

space

nation

is

years

will

entirely
more

be

new

less

for

housing

for additional liv¬

in existing houses. The
in the early stages

now

of

post-Regula¬

instalment sales contracts

running out next
for

pressures

with

and

year

more

housing

space

mounting, many a family of neces¬
sity will, give higher budget pri¬
ority to improving their homes.
This

will

be

short-term

now

services—whether they

ize it

for

With
tion

other, and more than ever
vitrually all types of goods

each

and

financing business will take

place.

especially true if
type home improve¬

permanent

are

growing children in the homes of
available
will
mean
gradually America, plus the added impact
of rising incomes and such other
rising unemployment, lower in¬
factors as television.
Although the
comes, and eventually forced re¬
population of the country is by no
ductions
in
consumer
spending
and allied needs for sales credit. means
adequately
housed,
the
The next six to nine months are principal
family need over the

spending

family budgeting and also in the
sales

trade, but in a real
competing against

sense

ment

at

I believe it is safe to
say that some
rather
fundamental
changes in

But, in recent months competition

ter of competition for the consum¬
ers' dollar just a bit further. Over

Facing Business

lenge

have in mind the poli¬

practices

of

group
to

we

and

ing relatively large consumer pur¬
chases, I want to pursue this mat¬

homage.

proper

the

cies

ting in the act to hold

American families

in

petition

still higher than during
his share
comparable period in history,

becomes

it

tell

can

and

heights in all but selected
areas

I

roughly

If

economic

a

No

business

of

attitudes

income is

which

consumer

the
built

third, and fourth births per
family now pose serious housing
problems for most young families.
They need more space, but typi¬
cally they have a small home and

have

an

adversity to

come.

World

before World

phenomenal

unemploy¬

as

can

through aggressive merchandising
of attractively styled and valued typical

our

of

been

commonly found house
today has only four

in

rooms,
rooms

be expected

can

long

so

ment remains under 3

This time inflation is to be
applied before there is any seri¬
ous deflation. The
therapy is to start on the basis of fear of
flation into

future

persist

economist is on thin ice
inroads
when he tries to judge spending

gains.

after-tax

as

maintained,

expected

or pre¬

of

the

ward

probable for at least the next six

venting depression.
This reduces this whole idea to the
old, old one of a
"little inflation" (or
really some undetermined amount of

Present consumer confidence to¬

Yes,

to resist any

expected

why this

Literally,

arranging the
financing for this "fix-up" work

enjoying an entirely different— present figure is 1,200,000. When
cracks appears in consumer con¬
and
greatly improved—standard
fidence, we know they take a good
of living.
These former "low in¬
deal of time to repair.
come" families in

will

on

end

an

America

more

begin to know how well this chal¬
lenge has been met.

third of the nation's

over a

stantial

any

that very

us

the

The most
in

arises.

..

available

By Aggressive Merchandising
—so

become

size house has

utilizing unfinished

savings
It

to

versation

industrial communities, and liquid

Danger in the Situation

ft

since

does

15

page

promises

condition
wrong

across

the merit of

being based upon an apparently greater faith
that the people themselves can and will make better use
of funds than the politicians who undertake to make de¬

what

acute "space squeeze."
It is not difficult to see

is

acquirement of the required funds by monetization of

public debt, while others envisaged the seizure by taxation

of

.Thursday, December 31, 1953

ments

with

have

new

to

be

financed

on

credit

consumer

and substantial

a

basis

monthly

instalment payments to be made.
Only if the fix-up business can be
financed by an inexpensive re¬

opening of the present mortgage
to lengthen its
maturity without
appreciably changing current
monthly payments can purchases
of

durables by families

consumer

facing

the

maintained

'ispace
next

squeeze"

be

year.

Whatever financing method is
used, however, we must recognize
the urgent aspects of the
fix-up

market.

I'm

will be

confident

that

there

large volume of business

a

for all concerned next
year, but
it will pay you to
keep an eye oil
the "space squeeze"

problem. For

as

its solution is worked

will
as

be real

some

new

out, there

opportunities

well

as

competition for your

business.

Well, it's fairly

easy to see that

"outside"

factors, beyond your
immediate control, are
going to
have

a

marked influence upon the

sales

financing business

year

ahead.

timistic

forecast,

cates

me

to

tential

over

My- cautiously
at

business

however,

least
to

the
op¬

indi¬

that the po¬

be

done

next

Volume 178

Number 5286... The Commercial and Financial Chronicle

year will be close to the volume

experienced

in

1953.

much

How

of this potential you will be able
to convert into profitable business
in

small

no

will

way

be

deter¬

mined by the skill with which you
control operations "within" your
individual companies.

own

I

know

from

convention

your

jprogram that you will devote most
of this afternoon to

a

forth¬

very

right
discussion
of
operating
.procedures, problems and pros¬
pects — factors largely "within"
management control.

This is very
appropriate and further evidence
of the excellent planning under-

flying this convention.
specialist

a

in

Not being

sales

financing
operations, I can only offer a few
general suggestions as to ways
company

in

managements

fields

all

take

steps to help in¬
1954 will be another

can

that

sure

;good

huge expenditures of the govern¬
materially affect the ment, especially for defense pur¬
supply of funds seeking an out¬ poses.
let. The lowering of inventories,
Credit controls cannot be al¬
the slowing pace of business, and lowed to interfere with
the de¬
the slackening in the rate of in¬ fense
effort, and it is not easy to

extreme views.
Loss of perspec¬
tive at any time is costly but this

probable reversal of its trend will

goods through quantitative credit

reduce the demand of bank credit.

control

will

As

first

a

step all of

business.

Do

must

us

theyithink of

the services which

we are

ing to them? "Do

we

policies

will

which

♦quickly

to

well

from

market
to

as

need your best skills to determine

who gets it and how much. Walk¬

ing

a

easy
or

a

credit tightrope will be

either excessive liberality or tight¬

hazardous.
Finally, we must set aside suf¬
ficient time to look beyond the
ness

may prove very

immediate

longer range plans.

of

Every

today has

the

on

to

an

Are

deci¬
influ¬
future

longer-run

business.

make

plans

your

Dean G. Rowland

us

a

fresh

we

are

fixed

re¬

our

2%

uncovering

memories

per

see

signs of

a

of the In¬

The current bulletin

stitute of International Finance of
York

•

least

at

re¬

probably

about the

same

of

rate

in¬

as,last year

way

several years ago?

If so,

we're losing ground.
Labor
<end
mot

at

costs

to

such

hand.

more

costs

Capable

personnel will be
eral

high,

are

rising

years.

personnel
training
programs
we

for

sev¬

planned
recruiting
and

our

3Do

and the
is still

^/executive

scarce

Have

we

accordingly?

have understudies for

our

&ey people?

our

economy

today

selling, and particularly to final

customers?
ammded

Do

we

program

to

the

Treasury
than

in

cash

a

Hence the demand for

smaller

have

a

well

to improve the

balance

civilian

new

will

the

basis.

money

be

past

much

several

the

of funds

other hand,

seeking

an

the supply

outlet in the

capital market is not likely to be
affected by a moderate decline in
business activity. The savings of
the people are to a
large extent
contractual in character. This ap¬

the

private sector is

strong.

very

desired results.

Through them the

Reserve authorities

tion
and

to

direct

capital

sidered

flow

into

desirable

in

are

the

a

posi¬
credR

of

channels
and

to

con¬

prevent

at least retard the flow into
other channels. If toward the en-*
of
1952 "and
the
early part of
or

1953
the

the

Board

Federal

still

of

Governors of

Reserve

possessed

System, had

the

to

powers

regulate

consumer

credit

mortgage

loans,

inflationary

pressures

the

an

would not have been

J

as

the

budget

on

a

to be reinvested. Under such

con¬

was

abandoned. It is also obvious

that
is

under existing conditions il
virtually impossible for the Fed¬

eral

Reserve

ditions it might be possible for
borrowing will be
the Treasury to sell securities that completely
past, and the

to

follow

a

independent

in the

policy
of

In conclusion the bulletin states

While
selling
the
long-term
that under present
conditions, fti
future,
therefore,
the Treasury bonds to ultimate in¬
would seem that the current
poli¬
policies
of
the
Reserve vestors is desirable, it is doubtful

government obligations. In the not
distant

authorities

primarily

may

by

determined

be

whether

this

could

be

done

on

a

cies of the Reserve authorities ancA

business

•

large

conditions.

letin

quite

recently,

the

bul¬

states, the Reserve authori¬

sums

farm

of

money

to

prevent fering of several options to meet

prices from declining.

In

a

period

of- declining business ac¬
companied by rising unemploy¬

the

needs

of

all

classes

of

in¬

were

confronted

with

the

the

their course,

run

unless

credit

policies

would

be

un¬

tain

Reserve

ther

and

of

cession.

the

ease

order

vestors.

The Treasury could, for exam¬
the ple, offer in exchange for matur¬
problem of inflation, and it was
Reserve authorities, as well as the ing debt three types of securities;
obviously their duty to combat
debt management policies of the one-year
obligations,
three- to
the
inflationary forces with all
the powers at their disposal. At Treasury, will be designed to pre¬ five-year notes, and bonds with a
vent a readjustment from assum¬ maturity of 10 years and
longer.
present it is becoming increasingly
that
need
evident that the forces of inflation ing the character of a serious re¬ Institutions
liquidity

selling, merchandising, and adver¬
have
tising parts of our business?

in

a

position to main¬

to

authorities

the

money

stimulate

will

fur¬

market

public

in

works,

capital expenditures and thai,

the government will take

facilitate

the

flow

of

steps to*
capital into

home construction and rehabilita¬
tion. In a period when the public
debt is very large and the
liquid¬
ity of the commercial banks rest*

primarily

on

Treasury obligations,

credit and debt management poli¬

acquire it by

or

exchanging cies can exercise a powerful in¬
As a third step, all businesses
not only necessitate an increase the central bank should lead or the matured obligations into cer¬ fluence on business
activity.,It ir
must review their credit policies in
tificates
of
indebtedness.
Those
military expenditures through¬ follow the money market. One is
gratifying to note, the study says,
carefully. With at least some lev- out the free world but also set in never certain whether a business desiring to lengthen their maturi¬ that close
co-operation exists be¬
cling, if not moderate decline, in motion
is temporary
and ties in order to earn a higher re¬ tween the Treasury and the Re¬
again a scramble for com¬ readjustment
turn could do it through the ex¬ serve
•general business ahead, we must modities. Not
authorities and that they arconly has the great mild or whether it is the begin¬
irecognize the financial implica¬
pent-up demand caused by the ning of a severe decline. This un¬ change or purchase of three- to keenly aware of their responsibil¬
tions of reduced income, narrow¬
notes
or
long-term ities and of the strong influence
war been met, but the productive
certainty creates difficult prob¬ five-year
er margins, reduced turnover and
bonds. Moreover, such a multiple that
their
actions
and
capacity of the free world has in¬ lems for the Reserve authorities.
policies
general pressure on the capital creased
choice
offering would maintain exert on business sentiment and
substantially. International If they adopt policies suitable for
structures of dealer organizations.
the yield spreads between short- conditions.
competition is constantly growing preventing a serious recession that
In 1954, there will be further sep¬
medium-term,
and
longkeener, and prices of many world does not materialize they could term,
aration of the good from the poor
commodities
have
decreased
to help to revive the forces of infla¬ term obligations.
managements.
Widely
varying
G. F. Rothschild Co.
In discussing the credit and debt
tion. This is even more true of
pre-Korean levels.
profit results are to be expected
In the United States the con¬ the fiscal policies of the govern¬ management policies followed up
G. F. Rothschild & Co., Inc. his
•within the same industries. Simiment. On the other hand, if only to June, the New York University been formed with offices
sumer price index has continued
at U>
Early, job experiences and income
states
that
quantitative Broad Street, New York City, to
to rise, but this reflects primarily mild
antideflationary
measures study
will differ among workers, to a
credit
control
is
a
powerful engage in a securities businefis.
an
increase in the cost of rent are taken they may not be ade¬
greater extent that this year, re¬
to
stem
the
downward weapon for curbing inflationary Officers are George F. Rothschil ,1,
following expiration of Federal quate
flecting changes in the nature and
rent controls on July 31, 1953, and trend, and later on any credit and forces. Through a policy of cur¬ President and Treasurer, and Vin¬
location
of
employment.
More
in the cost of transportation and fiscal measures adopted may not tailing reserve credit, raising the cent
Cioffi, Vice-President and
than ever before credit analysis
discount rate, and permitting gov¬ Secretary.
Mr.
Rothschild
wa?
be sufficient.
•will have to be based upon an services, items the prices of which
ernment bond prices to decline, previously with Batkin & Co. and
The debt management policy,
as
a
rule are not influenced by
antimate knowledge of the bor¬
the member banks are forced to was an officer of Baruch Roths¬
credit conditions. Moreover, his¬ according to the N. Y. University
rower's
current
situation
and
child & Co. Mr. Cioffi was wr*h
torically retail prices have always economists that may be adopted borrow from the Reserve Banks,
prospects.
Coburn & Middlebrook, Inc. and
lagged behind the. movement of by the Treasury is also likely to which further increases the Fed¬
foreseen

Pressure

of

Credit Policies

events

wholesale
stant

occur

prices.

increase

that

would

While the

in

con¬

wage rates has
credit
caused a rise in the cost of pro¬
policies will be under constant
pressure from many sides. Re¬ duction, once business activity be¬
quests for special terms and spe¬ gins to decline costs are likely to
cial considerations will be fre¬ be reduced through greater effi¬

During the coming

year,

The

have

prime question is whether

an

influence

and capital

ly,

on

on

the

money

markets and, indirect¬

business activity. While a
readjustment will make

eral

Reserve's

money

true

powers

over

the Stubner & Co.

market. This is particularly

at

a

time

when

short-term

Joins

Barcus, Kindred
high, inducing corpora¬
(Special to The Financial Chronicle)
it easier for the Treasury to re¬ tions to acquire large amounts of
CHICAGO, 111.—Robert W. Nisfund
maturing obligations,
be¬ Treasury bills and thus reducing
the liquidity of the commercial sen has joined the staff of
Barcus,
quent. How will you respond? Are ciency of management, machinery, cause of the impact of debt man¬
Such
controls, however, Kindred and
agement on business activity it banks.
your credit policies sound from a and labor.
Co., 231 South Ln.
cannot be used effectively or for
How far the readjustment will will have to be handled with great
long-term as well as a short-term
Salle Street. He was formerly with
point of view? Will exceptions go and how long it will last is care. A decline in business ac¬ any extended period if the infla¬
eventually undermine present pol¬ impossible




„

Under such condtions only
quali¬
tative
controls
can
achieve the

the
position of the Treasury and thaprincipal task of the Treasury will would be attractive to institutional
general economic policies pursued:
but
not
suitable
for
be the large-scale refunding and investors
by the government.
the lengthening of maturities of commercial bank portfolios.
smaller than

ment

recognize that the weak¬

est element in
as

a

of

of the Treasury are on the who«
conditions large scale without affecting busi¬
sound. The Federal Reserve ha*
and to a lesser extent by the needs ness adversely. In a period of de¬
kept the money market relatively
and position of the Treasury.
clining business activity, with the
easy, causing a decline in interest,
The credit problems confronting consequent reduction in the vol¬
rates, notably on short-term gov¬
of
loans
the monetary authorities today are ume
resulting
in
a
ernment paper, while the TreasMarcus Nadler
G. Rowland Collins
the opposite of what they were decrease in commercial bank de¬
i
yry
is offering new securities:
early in the year, the Institute's posits, it is not desirable to cause tailored to the
t<3r, and Dr. Marcus Nadler, Re¬
requirements of
too great a shrinkage of
deposits
search Director, analyzes the pres¬ study points out. While the deficit
the market. Should business ac¬
the
government still
exists, through refinancing operations. A
ent banking and credit situation. of
tivity decrease more than is now?
The writers foresee in the near business activity is decreasing and proper course for the, Treasury to
follow might therefore be the of¬ envisaged, it may be expected th 4
future a need for easier credit the government is forced to spend

ties

Economy
we

as

output

great as they actually were. The
plies particularly to funds flowing
into life insurance companies and impracticability of employing
classical credit control measurer?
deal will depend on the psychol¬ pension funds. Moreover, negative
undbr the then existing conditions
ogy
of the people and on the savings, i.e., amortization of mort¬ was
finally realized and the policy
measures
that may be taken by gage debt and liquidation of other

credit

BBjl

Until

Celling—Weakest Element In Our
Do

J

A

1

must

we

this

«

rate of at

a

means

1

■•

efficiency merely to stay
Are we doing anything just

even

1954.

cash basis, new

plans

creased

or

whole in

able

that national

and

year

This

oven.

by

country

decline in business activity, and say further
easing of credit may be needed in the near future.

sity,

New

second step we should

achieve

for

Collins, and Dr. Marcus Nadler, in bulletin

tell from changes in their

more.

bulwark

on

we

•efficiency is rising at
least

other good year for this business
but to offer a strong economic

will be balanced

of the Institute of International Finance of New York Univer¬

upon

policies what their future
likely to be?
As

the

the

the

without creating disloca¬
demand for capital from the tions in the
money market and in¬
private sector of the economy is directly affecting defense produc also likely to be smaller,
tion adversely.
partly
The situation hr
because
of
smaller
capital
ex¬
further complicated if the defense
penditures by business and partly expenditures lead to large Federal
because
the
declining starts of deficits that have to be financed
dwelling
units
indicate
fewer in the
open
market at a time
when the demand for
mortgages next year.
capital from

On

are
•

over

curtail

The

the past two years.
Moreover, while the demand for
outstanding record of
this industry, I am confident that capital from states, municipalities,
and public authorities will con¬
the ingenuity and determined ef¬
fort represented here today will tinue to increase, there are indi¬
combine not only to produce an¬ cations that the Federal budget
enced

With

Foresee Need for Easier Credit

render¬

fully

of consumer credit and the

crease

years.

opportunities
speedily
and unprofitable

for

Are

what
we

nancing business may now be
confronting a period of "rolling
adjustment" similar to that which
many
other lines have experi¬

but will not

are

enable

we;

high

the demand for credit and capital

University, of which
new
fully informed Dean G. Rowland Collins is Direc- the government in the not distant indebtedness, are bound to in¬
future. If the Administration is crease, and these funds will have
competitors-are doing?

sponsibility
markets?

Can

make

we

our

•

^neglecting?.; Have

on

situation and

withdraw

shrinking

no

task, but a wobbling policy
sharp slip in the direction of

and

us

markets? < What ^markets

record

new

particularly true during markets for the products usually
year.
American con¬ financed through your organiza¬
sumers are going to demand a lot
tions.
of credit next year,
In some respects" the sales fi¬
and you'll

have flexible

capitalize

•expanding
as

.

offer

really

we

Iknow just who our;customers
and' what

tions will

be

stand back and try to take a fresh
our

growth and rising family forma¬

the coming

ence

look at

m

icies?
If so, shouldn't they be geared not alone to meeting what¬
ever economic adjustment
thoroughly restudied now?
may lie
Selecting sound risks in 1954, in the horizon,1 but also to be
above all, will require that sales ready for the tremendous boom
financing executives keep their expected at the close of this dec¬
perspective toward general busi¬ ade or in the early 1960's? At that
ness and not be stampeded toward
time accumulated population

sion

year.

(2647)

to

state,

for

a

business

great tivity will result in

a

rates

are

John Nuveen and Co.
decrease in tionary pressures are generated by

The Commercial and Financial Chronicle...

(2648)

24

Continued jrom page

What did farmers do when

6

there

knew

be

would

they
sell the same product cheaper,
price make a substitute,

no

supports?

The Farm Situation Calls

You

bred

know

12%

farrow

For Revised Action

4
have helped to

strengthen the do¬

mestic market.

let's

get surplus feed to farmers and
in the drought areas to

and

•

their foundation herds. farm

save

Even

important, in many
respects, were steps taken to ex¬
pand the foreign market for farm
products. One such move was sug¬
gested by the American Farm Bu¬
more

Federation and approved by

reau

This provided that $250
million worth of surplus products
could be disposed of to friendly
Congress.

nations

A total of $175

for

earmarked

million has been
the

of
surplus farm commodities within
purchase

the United States under this plan.

Substantial
been

sales

have

Foreign govern¬
coming forward with

are

outlining their require¬
ments, and it is anticipated that
programs

several

allocations

large

announced

pointed

of

sur¬

commodities

farm

plus

will
It should

shortly.

that these

out

shows

they

Prices

broke

but

the

be

sales

as

let's take
of

interfere

with

have

that

of

some

are

been

done

the
to

working them out
every
law on the
tool

the

at

Department

of

stop

Do

sold

six

for

1939?

in

farm

of

years

to

raise

for

pound.

a

did not also

say

grams

is

true,

War

II—after

price

prices

0S3$*

that

away

ggS233S*

World

1950,

not

raise

did

farm

proach to
ernment

doctor.

farm

jThe other six danger signals
are- H Any sore that does not

diffi¬

up

.f

of

.

.

,

War

interested

farm

income

—

than
has

It

with

we

can

been

do

for

more

that

suggested

is

an

these

Next year; Congress will write a
This program may

farm program.

not be dramatically new—or revo-

will,

It

hope,

we

root

You
hog raisers know
happened to hogs last year.
were

you,
care

a




f

least.

And

helped

a

again and again in
meetings: That this
will

do

Cabinet
Administra—
everything possible,
our

Nineteen fifty-four will be
of

eyes

decision

a
agriculture.

for

of the nation

sharply

are

focused

on the farm problem. The"
real concern of farmers and

very

many others from ail waiks of life
is-reflected in letters and editoriads received in my

these

confidence.

office

I deeply

expressions

of

My hope is that I shall

;

not

are

supports

'

little
\

■

the

have

farmer

„

.

really robbing Peter
farmer

my

_

Order

m

digging

grave

a

ourselves.

Maybe

face

the

of

proare

we

controls

for

labor

is

what

par.

—

?<•

farmers

do

need

a

Farming is very diverse and

hazardous.

Farmers

don't

have

pound "collective

be

clearly

for themselves. There could be
better

sounding
for

grassroots

board
the

than

expression

thinking

on

no

this

of

agri-

our

cultural problems.

I challenge you to make the
most of this opportunity. All possible assistance you can give in
.this.crisis is needed—now.

Y#u may be assured that fundamental basic principles, never selfo 1 i t i e a 1 expediency, will
us Never will I knowingly
anything or recommend any

.do

to your

time,

any

emphasize interests of the nation, as well as
of course, The farmer,f
,
.*•
•
farm
Great decisions lie ahead. Let
Research is the tool that us approach them with intelli-

basis

it

of

must,

any

has given us higher

.

sound

yielding

livestock,

crops,

sprays

to

gence—let us approach them in
the spirit of men who value free-

protect us against insect enemies, dom and recognize the responsiOur

cotton

grow
more

as

a

yields

faster,
less

more,

our

feed,

on

milk,

our

our

broilers
our

hens lay

cows

more

result of research.

Research

spells

efficient

hogs 'bilities that go with it.
gain
The basic and typically Amerigive can idea behind any farm program
eggs must
be to help farmers help
themselves. Your Department of
pro-

duction—more net profit. It helps
a farmer better meet his
competition.

It makes him less vulnerable

to the price squeeze.
The
teammate
of
education.

I

think

research

our

is

Extension

a good job.
But
this I know, it can do a still better

We

Agriculture will always fight the
farmers' battle but it must be the
servant—not the master—of
American farmer,
'A

Service has done

some"

on

and

up

known

continue to

better-doing

pro-

to put them

stand

farm program must be in the best

.

job.

agree,

sort of program

They

the

program.

Industry has its tariffs—
why shouldn't the farmers get

I

win

research—for
be

theirs?"

farm

our-Department

,

we

tected.
so

to

make

same

we are

But

of

ean>

prolongwhen we'll have to

facts.

you

?uttin£ costs and greasing serv- interests.- At thecontrary
policy which is
ice where we can and when we

the other day that he was

He said: "I'm afraid

of

one

counted—-to

convention

Department of Agriculture

°Peratl0n

friends

happy with the present

numbers are not enough in any
battle. Now is the time for every

Reorganization is not over. We ishp
wlU continuously^analyze every guide

more

of

mere

abruptly. It must be a gradual ad- one argument. But it must be obIt's the direction we go vious that no one can speak for
from here
is most jmportarlt. farmers unless farmers first speak

of

Paul.

me

gram.

do

needs

But

justraent.

Its Own House

have

acreages

who

the
.

we

pay

told

were

prosperous

culture

strengthen
We

hope in

ahead

soil

the

that we not only
soil, but improve it
proper land use.

the

effort,

we

I?
*•

con-

years

sound

SAN

the

agri-

and must be achieved,

With God's help and

C

shall

servation.

can

and

united
shall achieve this goal
our

.

_

Exchange Member
FR ANrTorn

n

■,

.

*

•

ritAiNCibCU, Calif.—
through Ronald-E. Kaehler,-President of

conserve

bargaining except to a
the San Francisco Stock
Exchange
through their ownBut production is only half the ba5?
annnnnf>pH
rJt
organizations. But that's just part job. We must market our prodof
of the story.
ucts. I pledge to you we will use
C. Johnsen to membership
limited

was

at that time didn't think
sup¬
ports were feasible. At least, he
nan

most

Another

ago—only 77% of parity.
some agitation for
hog
supports then. But Secretary Bran-

local Post Office.

Society

selling for 16 cents

-pass on to you what he has said

.

The

(4) Since 85% of all feed grains
into livestock, Mr. Gehlbach

to

of

year

There

prices

greater

alb

said

income.

life, phone the American Can¬

livestock.

to

^

.

go

how

not

we write,
On that score, President Eisen—
hower has asked me personally to

out tbe bad Points> strengthen the and unmistakably your views on
weaknesses.
farm policy.
Even if desirable, we ^can t
The question of who speaks for
change our present programs too the farmers has created more than

will administer the program which

government

support

ing the day
did

farm program

great stake in this fight.

recently in the

the

farmer

help
at

effort to prop

supports

more

a

a

Vfeed

even

hardly

-seeking a new ap¬
problem, the gov¬
attempted to hold up
That

to

,

High

to

the

a new

necessity.

>'<■

to you that the

say

farmer's Prosperity is much

do for ourselves. Appreciate

can

even

Agriculture Department Getting

soil-depleting crops.
(3) Support prices have helped

That's why I say farm programs
alone cannot guarantee

cancer

Society office nearest

led

neither

born

1

Therefore, I

The

Melvin

of

selL

TT.

(2)

prevent farm

laws

■

,n

of

with

to

rgther than

farm programs did

your

write to "Cancer"-in

to

then

again
sharp

another

tress

govern-

.,

.

As 1 thmk back over thte years,

income.

encoirage

the job, as you well know.

cough

that may some day save your

American Cancer

role

j believe we've been led to expect

per

was

corn

farm income.

But

Any change in normal

your

as

turned around in

bowel habits.

.of

^

Fven if acre-

(1) High price supports on feed
grains
farmers to raise

up.

gave

urgently-needed production,

.

cer

go

we

had

culty in swallowing |*f Per¬

| For other facts about

...

•

observations

the 90% of parity supports, which
been designed to stimulate

m ( above) fH Unusual
,bleeding or discharge j|$ Any
change in a wart or mole §»§

or

to

II,

Korean

programs

prices

wartime

heal

or

I

other

income from dropping when prices
started down in 1951.

danger signals

hoarseness

War

of rising prices
periods of prosperity,
and periods of falling prices havebeen periods of agricultural dis-

year

'

lutionary.

bushel isn't enough.
It's price times volume that makes
farm income.

with war, caused

prices

Now, just

seven

or

the

farm

should always mean a visit to

sistent

all

large quantities of food

Instead

IB

made

land out of what

mean

farm

Price

boost.

elsewhere

indigestion

So have

up.

comes

that may mean cancer...but

Persistent

the

already in excess reserve.

know

?vfe+ "Vo re<?HJe will raise
supplies,
does not
it

statistics.

hungry millions abroad. And
gave

your

farmers

^ ?

your

are

general price level

After

in

commonest

a

,

q

higher than a
pound today. Farm prices

gone

tion

m

the

shall

,

the

of

are

Congress writes. Ip the meantime,
Gehlbach, 'we are getting ouf own house in
prices.
But, ladies and gentle¬ an Illinois farmer, who
gave the order. We have already reorganmen, it was War—not government House Agricultural Committee ized the Department to serve you
farm programs^—that"raised farm these four
indictments of our pres- better—to make your tax dollar
prices after 1940. War, and infla¬ ent grain support
program*
buy a dollar's worth of service.

have

second

a

big

as

corn—you've

corn

orr

of

on

we

progress.

that government

Fact No. 2: What will you plant

all

Department

our

us

bushels before.

grew 50

of

are

in

periods

been

take every measure, use .every
tool at its command to help mainto tain our national income at stable
levels.

Upp

.

done by pouring the

on

that

the

in

hogs

nickel

the

fertilizer

;

Agriculture book

is

78%

Incidentally, these facts

But

Belt

be

effort—

only

were

the

That,

must

we

^ve>ve been led by a blpd faith

on
the idle acres?
Large scale
in
control
creates
a
new
oP acreage
years large scale problem

seven

support

parity.
published

or

Corn

can

,,

all-out

to match!—if

you

acre-

affecting

agricultural states-

told

thought

but keep this
to the. outbreak

Prior

of

that he

factor

from farming.

a

You

may
contend that costs
also lower before the war.

farm

alone will not do this job.

[Ti.in the breast

only

was

Cattle brought

100-bushel

World

that it is

Tn
In

na

little hocus pocus the Sec- 'continue to merit that confidence
wheat crop as before.
You could retary could assume that there's As the nation's largest general
do it, he was convinced, with more still an emergency and therefore
farm organization, the American
fertilizer and summer fallow.
permit higher acreages of crops Farm Bureau
Federation has

Hogs
of

were

the judgment of many farm lead¬
ers
that , government farm
pro¬

minnlipc
supplies.

30%, and still raise

age

average

Corn

bushel.

a

prices.
an

the

continue

mpnt

Kansas farmers could reduce

and

That

wouldn't be honest with

rpdnrp
reduce

last week

me

after

was

programs

sold

year

mind:
you if I

hogs

That

to you that

say

have

aTCtr Productlon actu- too much of government. I think
ally goes up.

Some

Alone Will Not Do the Job

I

aiwavs
always

1940.

Government Farm Programs

But

not

\$hat

income.

Farm

the

the facts?

are

cents.
Hogs were actually 61%
higher in 1930 than they were in

working on an overall program
help insure the farmer a fair
the national

what

of

tho

f t h
b
t
f
the last 150 years-that changes to

tion

I

And
also

A farm editor from Kansas

57 cents

of

literally

farm

remember'

achieve.

Fact No. 1: Acreage controls do

7

to

share

over.

stabilized

not

,

What

the farm

at

Facts

if

me that thi

Situation

But all of this farm leg¬
has

you

that

have been

we

have

book

We

„

manship
The

going

the Democrats took

legislation

even

law.

At the same time

prices from

they

acreagfe controls,
supplies and thus

know

We

What
1933

setting

farm in-

your
nniv

on

G°d £°r HiS

personal

from

know

restrict

well-meaning laws did

farm

beyond the requirements of 614 cents

gone

1929.

by

we'd

the

income!

Agri¬

well

Board

In

every

We have

after

through

Arab'

hi?h

do

you

the generai price ievel is the most

general,

be strengthened,. As most

can

you

be

job

£.ome wm b.f .hlgh only lf the na~

have

.

,S °nr

.

will

come

profits

DOUmy*
For in America we have the
experience, we're heading for productive soil.. We have the tools,
acreage controls on cotton, wheat, We have the science and education
and possibly corn—our three bigSive us know-how. We have
gest crops. The idea behind it, is
freedom to inspire men to
they

of

a

nwnTarm"

important

0nly by Qur

^seZhP=VrkPsXS

Farm

of

Sj

That's why we are cross-exam-

raise farm income.

these

thefarmers

Riches"

.

:

XriculSa

out

And in America. We are embarrassed only by our riches: Farm
problem.
Can you imagine the
],ook
amazement on a Russian s

government pos-

farm

islation

re¬

than

bilize

not

the

little better than

are

own
.

re¬

tried

we

faster

that

thrown the law

used

books,

culture's command.
the

have

we

died,

soon

remember

income

in

Peoplyso to bed hungry
Many of

night

pretty good

a

sibly can?

the last 30 years.

can

annuugu

people

farmers-two

from hogs of the world

particular farm prob-

a

prices through organ¬
ized marketing. We tried to sta¬

problem.

help

lem

to-control

Then

things

lieve the plight of the farmer.

will solve

down.

through private channels.
These

Many

was

gcmicmeu,

three

0f

a^e

three
each

argument that supply and demand

different

the first Woild War when

are

trade

normal

you

ana

out

tw0

First, how good
Vnnr

Second, I believe

Ladies

Chicago

Prosperity

future

prosperity, I be¬
lieve, is going to depend largely
on two
things:

as

world

more money

Doesn't this make

Yes, but that's ancient history,
say.
We're smarter today. I
hope we're smarter.
But

sows

prices
Some of

hog

for $24.00.

have made

failure.

a

'are
buying
much margarine as butter this year. You know the reason why.

nearly

Is there any hog farmer in the
who
thinks
he
would

you

being made in/such a way as not
Since

to

Jaw.

itself

the

Housewives

farmer.

audience

the Ro¬

700

with

same

,.Embarrasscc]

ago,

on

the

Your

-

most comprehen¬

the

law

fewer

And

quickly.
here in

hogs

You

spring

have.

centuries

set

for

works

Basis for Farm

or

this year if
government had agricultural slaves.
support
history stepped in to support prices in

not

because

never

were

week

together

items. Penalty was death for those
who

back

this

pric^Hffi^ng laws in history.

that

be

will

is

wrote the

mans

sive

Most

already

completed.

ments

income

farrow.

sold

did.

you

sows

this year—5%

fall

bounced

lead to the truth.
have for saying

programs

farm

pealed

liberal terms.

on

I

reason

Sixteen

facts

these

if they

First

ranchers

help

follow
see

what

fewer

you

Now, I've been told that it's not
smart politics
to say this.
But

Special efforts have been made
to

lor

lt

Thursday, December 31, 1953

extent

T\ a"nou?ced the Action

-

If

unions

price their labor

too

every

resources

in

cooperation

-in the Exchange.

high, they run the risk of unem- with industry to find new markets "
Mr. Johnsen is a general
partner
put them into effect. Per¬ ployment.
for farm products, to recapture,
s
haps because of the dismal failure
The manufacturer can set his insofar as
possible, overseas mar^axwetF ^ai'I T.
of attempts to
support live hog price, but if he sets it too high kets we have lost.
*
■
-Parrish and Victor T. Maxwell are
prices in the 1940's.
some
other smart operator
will
One final thought:
also general partners of the firm.
didn't

•

^

.

-

i

.

™

Volume 178

f-'t

Number 5286The Commercial and Financial Chronicle

*

Alfred

Allin

T.

Hannan,

Jr.

News About Banks

New

NEW

24

Joseph

been

of

The

of

announced

was

by Albert

on

C.

OFFICERS, ETC

Simmonds,

CAPITALIZATIONS

and

the

Dec.

1939. He was on
military leave from 1941 to 1946,

of Company

Company

Trust

announced

31

in

Robin

A.

Walter

H.

Gordon when he rejoined the organization.
Mr. Pyne was appointed an AsBBSS sistant Cashier of National City
Bank in 1947, an Assistant Vice-

Potter,

in

President

and

1950

Vice-

a

Danton

and

becomes Assist¬

ant Treasurer.

Carleton

elected

:|s

M.

jjs

Burr

Dime

has

been

Secretary

Savings Bank,

York, according to
made

Mr.

an

J.

by

Among appointments announced

Burr

by the Board of Directors of The
National City Bank of New York
were
the
following: • Harold L.

Since

formerly Manager of
Island
City
Branch,

records of

the

Long

New

announce¬

Wilbur Lewis,

Dime

started
came

ing

has

as

agent

Findlay Porter, Richard S. Smith,
and Robert Swanson, Jr., were ap¬

the

that

York

Vice-

President

in

the

of

the

Chemical

de¬

investment

partment
Trust

and

Company,

Bank
York,

New

died at his home, on Dec.

25, after
long illness, at the age of 48.

a

Mr. Parker

joined the Guaranty
Company of New York in
1932, where he served as an Assis¬
tant Treasurer. In 1944, Mr. Park¬

Trust

er

Bisland

Duval
have

Brown

and

been

H.

Stanley

promoted to be

Vice-Presidents.

Vice-President

elected

was

Continental

the

Brown

H.

Stanley

Bank

Company in charge of its investment portfolio and its municipal
boncj department.

.

When the Continental Bank

.

of

Trust

and

'

was

six newSecond

V'ce-Pre^aents
?,ie
John- Bete, Jr., John P.
Bochow Joseph -D. Dent, Wilbur
C.

Firmbach, John

Knott and

S

merged with the Chemical Bank
ancj Trust Company in 1948, Mr.
parker

made Assistant Trust

Officer,

John

and

Assistant

new

is

Doty

R.

in

Manager

Foreign Department.

-

*
Trust

ers

William

elected

^

Company,

Newly announced Assistant William
Treasurers are Eugene W. Potter,

F.

Finley and
Vice-Presi-

McKinley

•

York,

New

J. Steuber and H.
III. New> As¬
sistant Secretaries are Edwin J.

Jr.,

Lawrence

Clifton *Whiteman,.

:

?£

*

V" '.

*

-

'hlei '

Richard S. Perkins has been ap¬

pointed

of J the

Vice-Chairman

.'

National

Board of Directors of The

an

inception,

Mr.

Vice-President.
has

belman

with

been

the

Do¬

bank

Assistant

the

new

Loan

named As¬

was

an

and has been
position of direct¬
and Discount De¬

;•«

The

in

Phillip J; Carroll,

appointed

was

partment.

its

organization and
has
charge of its Installment
Credit Department which he will
continue to direct.
His assistant,

an.

Cashier,

given the
ing

to

Vice-President.

E. H. Kafoed

George H. Dobelman, formerly
an
Assistant Vice-President, was

elevated

was

Cashier

Assistant

Assistant

$

fji

of

Bank

»

Belmont

Shore,

Long Beach, Calif., has become
Federal

the

of

member

af

Reserve

System effective Dec, 14.. ;:

;

ft

23

Can Government Avert

announced

Kleinert

has

been

*

*•

*

Monthly publication of the Guaranty Trust Company of New
York holds real task of readjustment after a boom is not per¬

"

:.

Recession?

a

by government, but by business itself, under

formed

of contracting

pressure

/

markets and tightening competition.

The

of' the

James

"The

M.

President

Large,

of

Tradesmen's Land Title Bank and
Trust Company, Philadelphia, Pa.,

the election of George

announced

H.

Earle, IV,

of

the

as

Vice-President

a

bank.

issue

essential
of

advocates

fact

which

the

governmental inter¬

vention refuse to face is that busi¬
ness

A

recessions do not just happen.

recession is not
but

accident

a

an

unfortunate

corrective

process

due to and necessitated by

Mr. Large, at
J.

January-

the

same

the

time, also

promotion

Hermann

to

of

Assistant

the ex¬
maladjustments that

and

cesses

arisen

have

under

condi¬

boom

Like other market fluctua¬

tions.

from

occasion

one

to

another, at
There

least in their visible effects.
is
In

statistical

uniform

no

pattern.

inventories
excessively.
In others,

some

rise

cases,

may

the
be distorted.
Price-cost relationships may gefc
out of balance.
Speculation may
carry prices of commodities, secu¬
rities, or real estate to unwar¬
ranted heights.
Credit expansionmay overtax the reserve base. Ar¬

price

structure may

Vice-President, and the appoint¬ tions, it reflects a need for read¬
ment of Leo J. Hughes as Assist¬ justments, and its function is to
ant Treasurer.
effect such readjustments. Meas¬ tificially easy money may create »
false picture of market conditions'
Mr. Earle, who joined the bank ures to avert it, even if tempora¬
and business prospects. Extraneous
in Jan. 30, 1950, was named an rily successful, would at the same
time prevent the needed correc¬ factors such as wars, crop failures,
Assistant Cashfer on Nov. 9, 1951,
or broad changes in governmental
and an Assistant Vice-President tions, prolong and aggravate the
unsound conditions, and store up policies may upset business ex¬
on Dec.
1, 1952.
more
serious trouble for the fu¬ pectations.
' •
;
Mr.
Hermann
came
with
the
,

.

on

Bank

City Bank of New York, the Board

.

ture.

"These conditions occur in sucbi
April 1, 1944, and was
'.' "The
interventionists
profess a bewildering variety of combinaappointed Assistant Treasurer on
Dec. 31, 1947. Mr. Hughes joined horror at the attitude they ascribe tions that so far/ at least/ theyr
to their opponents, that 'a little have
generally ^defied
Tradesmen's on April 1, 1947.
analysis;
bit of depression is a good thing.' and
prediction,
diagnosis
and
The implication is that those who treatment.
Governmentally
ad¬
Directors
of
Mellon
National

'

*

the

its

from

of
"The businessmen and investors mis¬
outstanding stock
from
$50 per share to $10 per Guaranty Survey," published by judge future markets and embark,
share and each shareholder will the Guaranty Trust Company of upon projects that prove unprofit¬
able.
Some
businesses
overexreceive five new shares for each New York, in an editorial article,
entitled "Why Permit a Depres¬ pand, and some commodities and
share now owned, and in addition
sion?" questions the validity or services are
overproduced.
The
will issue 25,000 additional shares
the power of the government to schedule of production somehow
of $10 par, making
the capital
gets out of adjustment to the real
apply
effective
anti - recession
$750,000 instead of $500,000. The
stimulants.
Commenting on this, wants of consumers.
deposits are $31,197,527.99.
the article states:
"These tendencies vary widely
value

bank

Wilbur B. Rose. ,r
«

of

since

clude:

been

head.

Klein, the head of the

-

Davis, George T. Fowler, Neal E.
McHargue,, Francis J. .Quinn and

V,

Changes in the official staff in¬

Jan. 12, 1954, the Lan¬
County National Bank, Lan¬
caster, Pa. will reduce the par

Frank

*

The Board of Directors of Bank-

a

the

*

Louis F.

also been connected with the bank

of

announced

Edmund C. O Bmn. Lawrence M.

Pritchard is

partment.

the

bank's Bond Department, who has

since

purchas¬

Assistant Vice-Pres¬

an

with

Director.

a

Ac¬

of

exceed $8,500,000,

now

caster

e]ected vice-President

was

,atter institution

f the

'

Dec.

on

Harry A.

elected

Surplus

funds

made

ident, and will continue his duties
in the Correspondent Bank De¬

$2,500,000,
Surplus
$5,000,000, and Undivided Profits in
excess
of $1,000,000.

He

unit

a

charge

ft

*

Jr.,

bank

its

to

capital

William T. Eddins, in the bank's
Correspondent .Bank
Division,
who has been Assistant Cashier,
was

of

Bank's Undivided Prof¬

The

count

was-

bank's*-

Gentilly office.

the

that good
had war¬
$500,000

22,
year

transfer

Account

College Point National Bank of;
New

in

Carroll

Manager, of the

bank.

it

As

Parker

S.

its

the

for

the

ranted

be¬

later

been

in

and

pointed Assistant Cashiers.
Charles

has

the

1923.

and

then

he

1934

with

since

teller,

a

following

La.,
Dec.

on

earnings

named

been

clerk

a

ap¬

were

pointed Assistant Vice-Presidents
and Robert R. Atterbury, Jr., Dan

Gordon B. Duval

Potter *

Union

Hammond, formerly an Assistant
Cashier
and
George
F.
Nolan,

,

Orleans,

Mr.

Cashier.

formerly

meeting of that Bank's Board of

of

President of the bank.

Walter, H.

New

sistant

by

Davis, President

Capital

Assistant

Union

ment

1952.

President in

made

Vice-President

:-t

that

West

was

on

made

was

M.

of the Hibernia National Bank

from the

states

Assistant

on

Wallace

Directors

Coast. John O. Tiernan

Guaranty

Mr.

Jr., President. Mr. Allin is in the
trust department and Mr. Hannan
represents the Bank in the Rocky

Bankers

and

REVISED

New York

Announcement

A.

named

Bank

Mountain

BRANCHES

NEW

York, it

Dec.

CONSOLIDATIONS

and

have

Vice-Presidents

(2649)" 25

Co.,

Pittsburgh,
proposal to

a

believe in the dream

not

do

Trust

&

Pa., have approved

perpetual boom
at

least

are

of

a

in favor of, or

indifferent

ministered
'reflation'

doses

in

an

inflation

<*f

effort to

:

or

prevent

shorten the inevitable reaction s
to, the losses
of the and
hardships that attend a de¬ may
.temporarily
alleviate
t hechange the cline.'.-.symptoms but cannot be expected
; / [I;r;■':•
present 601,000 shares of $100 par
to cure the ailment.
The longest
"Any such implication is unfair
stock to 2,404,000 shares of $25
and misleading. No one likes de¬ and most disastrous depression fant
par.
•'
pression, whether little or big. The history was the one which govern ¬
Stockholders will vote on the
most
strenuously to
businessmen who are accused of ment tried
combat
with
proposal at the annual meeting such a
inflationary injec¬
feeling are
among
the
Jan. 26.
tions.
It is inconsistent to assert,
heaviest
losers
in
depressions.
ft
ft
ft
Most
businessmen are, however, as interventionists do, that booms
The Board of Directors of The realistic
create
maladjustments but that
enough to recognize that
Ilackley Union National Bank of the
weaknesses
generated
by they can nevertheless be indefi¬
Muskegon, Mich, effective Dec. 15, booms must be corrected before nitely maintained on a sound basis.
1953 increased the surplus of the new advances can be made.
Any attempt to prove the truth o£

change' the-capital

or

stock

bank.: The plan Would

F.

William

Finley

McKinley

William

dents, it was announced

Dec.

on

29, by S. Sloan Colt, President.
At

the

Dowell

time

same

Cochran, Jr.,

Henry ,J.

andt Kenneth H. Mc¬
promoted

were

Trust

to

Officers, and C. Russell Sigler was
Assistant

elected
All

five

the

Bank's

Trust
Eben W. Pyne

Richard S. Perkins

announced

tinues

as

Bank

,At

of

Bank

Farmers
on

Pyne,

the

same

a

City,

Vice-President

Company,

City's
of

Trust

formerly

of National

•

meeting

a

Directors

Board

held

City

National

York,

affiliate.

con¬

the

Trust

Farmers

New

He

of

date,

trust

City

Company
Eben

W.

appointed

of

City

a

Bank

Farmers Trust Company and As¬

Mr.

Bank

to

the

President.

Perkins

joined
Trust

Farmers

March, 1951. He

was

Trust

Pyne

Company

1926 and

was

Assistant Trust officer
#

*

as

of

Walter

A.

Vice-

Assistant

an

Trust Company

Midland

of New York has

announced

by

James

G.

Stoecker

associated

Senior

was

formerly

one

Examiners

of

Bank

York.

After

the

Profits

and

Contingency Reserve

associated

and credit

The

questions. Some theorists find the
ultimate explanation in monetary

of

dend

60c

1,043,000

semi-annual

40c

directors

and

declared

was

payable

on

to stockholders of

divi¬
divi¬

extra

an

by the

Jan. 2,

1954

record Dec. 21,

of

the

year,

with

operations.

its

he

Office

psychological

on

sive

also

Board

Orville

F.

appointed

Janis

an

Assistant

Mr.

1953.

Manager
since

lending tinue

of

June

to

of

Janis

Real
1953.

head

the

has

Estate
He

been

see

Real

the

con¬

Estate

Loan Department of the bank.

waves

of

ferent types

final

cause

production

proportionate

credit

exces¬

as

against

markets

cause

or

is

it

booms

the

ventories

projects

dif¬

Operating

or pro¬

or

fundamental
may

that

one

unsound

tenden¬

or

another,

reason

to

is

wants

are

The

are

ic

is

in

labor

eliminated

quality

of

improved.

written

levels.

down,

Consumers'

re-examined, and pro—

schedules

cordingly.
mantrhin

realigned.

are

services

values

are

duction

In¬

out.

Unsound

inefficiencies

diminished,

realistic

competi¬

abandoned. Price and

management

and

cut

reduced.

relationships

consumers' goods

agreed

generate

For

are

of

and

tightening

are

cost

complex of causes

generally

and

Deadwood

tion.

Inflated

"Whatever

cies.

under the pressure of contracting

dis¬

goods.

be,

government but by business itselC

in

of goods—durable as

against nondurable goods,

Loans

will

rapid

optimism and pessimism. Still

others

Mr.

Cashier of the bank effective Dec.

to

Others lay the blame

expansion.

ducers'
The

due

disturbances

Fds. $3,043,000

Capital

regular

dend, of

15,
first

will be located at the Main
and

Undivided

1,200,000

1953.

with the Federal Reserve Bank of
New

—

Total

President of The Marine

the

$800,000

_

Surplus

*

election

Stoecker

Mr.

a

*

in

with the City Bank Farmers Trust




in

to Bankers

as

elected Presi¬

became

an

1930.

The

such a self-contradiction in prac¬
from $800,000 to $1,200,000
"What
are
these
weaknesses?
tice
would,
if
continued
long"
transfer of that amount from What
happens during a boom to
the undivided profits. The bank's
enough, end in general wreckage.
make a readjustment necessary?
capital structure after this trans¬ There is wide
"The real task of readjustment
disagreement re¬
fer is as follows:
after a boom is not performed bygarding the basic answers to these

by

Capital

Company

elected

City

dent in December of that year.

Mr.

officer

Blaine, President.

the

Vice-President

Executive

Company
an

1944.

been

sistant

Trust

elected

Mr. McKinley came

Vice-President

was

was

.

bank

Advisory Division,

Bankers

to

in 1932 and

in

with

Personal

and

Finley, who is in charge of

came

in

Officer.

Trust

associated

Pension

the Investment

the

of
the

are

Department.

Mr.

29.

Dec.

on

President

men

p

are

altered

ac¬

The 'lost art' of salesrprHsrm/prpH "

f

26

.

(2650)

The Commercial and Financial Chronicle

Coombs & Co.

from

135,000 to 159,000,
14,000 during the year.

Opens

SALT LAKE CITY, Utah—Jack
jft. Coombs has formed
Coombs
,

L

and Co. with offices at

146

Despite

Mutual Funds

South

Main Street to engage in the secu¬
rities business. He was previously

four

By ROBERT R. RICH

creases

A MUTUAL INVESTMENT FUND

BY

dividend

securities

on

held

in¬

in

Barringer reported
tors

our,

of

trial

commented

NATIONAL

funds, there will be no recession
in 1954," George M.
Field, Presi¬
dent of Renyx, Field & Co.,
Inc.,

a

SERIES

FREE INFORMATION

in

Noting

RESEARCH

CORPORATION

Established 1930

120 Broadway, New York 5, New York

simistic

there

were

talk

by

the

in

economists

some

1952,
there

attitude

bursements

constitutes

affirmation

look

I

omy.

of

dis¬

forward

to

the

sheets
"It

con¬

rail

ments to stockholders should hold

have

close to current levels. This
serve

as

strong base for

a

the continued growth of

our

funds

YOUNOID J9281

hitherto

your
or

slight

decline

in

earning

part of

the

investment dealer

PHILADELPHIA

3, PA.

continued

railroad

negative action

securities,"

D.

stability

'

of

their

command

se¬

than

more

set-back

ness
■

ing from

likely, judg¬

seems

the

of

percentage

new

equipment, the higher mainte¬

Reports

Massachusetts Investors Growth
Stock Fund reports total net as¬
sets

Nov,

on

30

of

BANK FUND

•

$42,117,695,
equal to $17.20 per share on 2,448,987 shares outstanding, com¬

FOUNDATION FUND

•

pared

with

total

$40,904,324,
•

GROWTH FUND

share

•

INSURANCE FUND

has

a

year

assets

of

$17.88

to

2,288,168

on

standing

net

equal

per

shares

out¬

The

fund

ago.

17,821 stockholders, a gain of
over
last year.
The num¬

2,079
ber

of

stockholders,

shares

out¬

standing and total net assets

were

at

INCOME FUND, INC.

•

record highs.
During the fiscal year the fund
paid
four
quarterly
dividends

from income

share, the
Distributed by

HARE's

LTD.

■

i

may

the above

or

be obtained from

paid

per

last .year.
A
of 26 cents a

as

special distribution
share

19 RECTOR STREET, NEW YORK 6, N. Y.

Prospectuses

totaling 52 cents

same

but

market

realized
of

net

the

"from
to

do

Missouri,"

we

the

are^selling at only five times their
expected 1953 earnings per share."
TOTAL

and

sales

of

invest¬
gov¬

totaled

$8,247,078 and $5,respectively.
Common

172,444

of

stocks
ent

industries,

14

totaled

Diversification
at

fiscal

the

of

differ¬

97%

the

year-end

pal industry groups,
with

a

of

portfolio

by princi¬
compared
follows:

as

year ago, was as

November 30
1953

Oils

I_:

Electrical

Pulp

21.0%
8.5

10.9

10.2

9.9

9.6

7.6

Services, Inc.,

6.6

Paper

Aluminum

Major

purchases

fund

ended

for

Nov.

I NEW

YORK §1
lili liiiiiVmwm
mm mam wmLmam
'

me a

no

obligation please send

prospectus on Canadian

Fund.

the

30,

and

sales

fourth

of

Amerada

1953

of

were:




com¬

Total

shareholders

num¬

increased

D. I. F. Shows

of all

in

Fund, sponsored by Hugh
W. Long & Company, Inc., totaled
Fund's

Nov. ^30, last, the
year-end, compared

Corp.__:

1,300

Republics Corp

National

3,000

McGraw

«10,000
Life

Electric

Motorola,

Ins.

Co

1,000

Co

2,000

;

Inc.

Pacific

Coal

&

"Purchased

partly

Oil

5,000

Co

2,000

through

rights.

new

Investors

Emhart

Victor

Standard

Chemical

Life

Works

50%

ing

higher proportion of

a

rities

considered

resistant

to

be

to

wide

Fund's

Price

Index

The retail cost of

1.3%
ite

and-public

industries

gas

favored

"because

of

their

housing

emphasized

position

in the nation's natural resources."
The report noted that corporate

profits
and

being well maintained

are

that

business

activity
generally higher than a year

was

ago.

"Although there are many signs
pointing to some curtailment of
volume

in

lines, '

many

port stated, "there

cluding

probable

the

re¬

others, in¬

are

for

the

Ins.

10,000
.

Co.__

5,000
8,900

5,500

and

gas

reduction

taxes

in 1954, that warrant
optimism."
'

As the Fund's investment

little

electricity

solid fuels and fuel oil

Portfolio

Hudson

When

mentions

someone

(about four out of five) he

giant

and

Telegraph

82%

of

American

the

of

some

telephones

in

With

than

48,000,000
United States

the

its lines, the Bell System is by
far the
dominant
factor in
the

have had
can

and

than

more

Bell."

match

One

General Telephone

Largest

of

the

dependents,"
operates
in

19

some

record of growth tnat

a

"Mother

others,

are

Corporation.

over

from

It

showed

the

16%

Fund's

fiscal

in

and

assets.

1%

increase in both plant investment
and

revenues

in

the

Bell

System

doubled.

1945

since

same

while'

period

seven-year

plant

Its 350%
seems

boost

for

and

revenues

increase in net

to

pale

129%,

a

AT&T,

quite

cash

the latter's

size.

Nor has General

Telephone

been

left

only

into

general

economic

conditions, but also into
business enterprises, the

specific

in

dial

itself

mately 70%

HALE,

agent

in

cently

the

investor

$1,000

our

Vance,

Boston,

of

amount

would

of

Sanders

computed

re¬

money

need

to

investment

an

"buy"

income

in

in the

One

at

Bell

the

of

the

compared

Largest

holdings

System.

widely re¬
contributing to General
Telephone's performance is the
trend of population and industry:
garded

as

from congested metropolitan

away

various types of investment media.

centers

"It is

regions. Unlike the Bell System
territory, General Telephone's

particularly timely to make

this test now," Mr. Hale remarked,

the

service

the

of

1953

year

produced

prices

to

'

all

Telephone,

Required

to

Buy

JL':

of

General

this

will

trend

Donald

his

enhance

company's

pros¬

$36,000

cover

the

'Bell's"

33,000

umbrella

country,

hasn't

but

it

hindered

Indeed, he's

junior

come

of age:

and

the

^Fundamental Investors, Inc*
Diversified Common Stock Fiind

in

aw*-

Diversified Growth Stock Fund

stock

his

petroleum,

railroads

industries.

comments

the annual

accompanying
report, Hugh W. Long,

President,

stated

somewhat

lower

business

is

level of

expected

management
substantial

He

that although

does

not

business
sees

in

decline

spending,

and .commercial

by

as

resi¬

building

industrial

and

public utility companies for addi¬
tional

facilities

and

equipment.

*

»

w

,J^lanhattan Bond Fund, Inc*

a

PROSPECTUSEjf AVAILABLE
FTTOM

business sustained

governmental

expenditures

the

regard

-

a

over-all

1954,

Diversified Investment Fund

«r:.-vVr

YOUR

ON

LOCAL

THESE

MUTUAL

INVESTMENT

FUNDS

DEALER.

OR

Cleveland

Chicago
Los Angela

Hugh W. long and Company

San Francisco

Incorporated
Westminster

at

Parker, Elizabeth

3,

New Jersey

may

appar¬

11,-

other

"de-

continue

pects.
"Mother

savings bhnk
Long-term Govt, borfdg^.

large

no

.r

$1,000 Income

stocks

believes

urbanizing"

'

to

Capital

suburban

Mr.

areas.

President

Power,

in

almost

securities."

includes

area

metropolitan
C.

relatively,
of

and

date

considerable

a

change,

market

into: rural

common

common

in

were

use

with'

reasons

rfcr

14%

post

Approxi¬

of its customers

instruments,

79%
ED

considering

installations.

dial

report said.

invest¬

and

an

tigations,

in

year-end

bonds,

in

tq

three-fold,

a

achievement

changed from 1952.
the

"in¬

Vermont

sports

Quarterly dividends
paid totaled 3-3 cents a share, un¬
of

the

so-called

925 to 12,254.

at

of

is

General Telephone
1,530,000 telephones

states

California.

that

such

the number of
from

are

means

Telephone

Company.

more

income
man¬

the.

on

ently

increased

!

Telephone

Fund

"telephone company" chances

progress.

year,

and]

sub-groups.!

ager, I. D. S. plans to maintain
and expand its continuing inves¬

not

j

Report:

General

17,000

shareholders

showed

index

natural

basic

declined,

change over the month. Fraction-,
ally higher prices were reported

But there
fields."- industry.
around 5,400
in fact,

utility

were

food

man¬

standpoint of price sta¬
bility and reasonable income, and
recommended for purchase," the
report stated, "are the food, to¬
In addition petroleum and

1953

the month. The compos-,

over

From

the

bacco,

Consumer.

in

object¬

industries

City

November

for

the

"Among

sharp

a

secu¬

fluctuations

investment

was

(1947-49=100) is 112.9.

also aimed at consist¬

stated

decline

prices;
Contrib¬

in¬

so

of income, in line with the

ency

the?

retail

of

York

New

relatively

price, the Fund's investment
agers have

to the

The

30,000

dential

rights.

Manufacturing Co

Jefferson

in

Mutual
About

funds have been

new

uting

of

movement

index

drop of 1.3% in retail food prices.

30,

Sold

Company,

high
money in¬
a

York

Common

During the

decline represented the

downward

New

High-grade corporateS1^

1952.

Statistics.'

of Labor

Bureau

0.4%

In

by

SALES

Company—
Cup

bor's
The

with $32,277,160 12 months earlier.
Net
asset
value
per
share was

In

Corp.

Lincoln

consid¬

was

vested since early January, 1953.
While recommending and buy¬

on

fiscal

October

between

November, it was announced;
by the U. S. Department of La-:

prog¬

report,

invest

securities."

amount

Net assets of Diversified Invest¬

$33,109,727,

and

"it

to

the

investment

policies

proportion of the
'stable'

of

Fund's annual

advisable

vested

close

of

pointed out that

has

ment

aviation

Bought

Petroleum

American

Dixie

City.

the

"because

likely.

Address.

the

preferred stocks, 69% in

quarter

Company—

Texas

Nome.

in

told

were

ments

PURCHASES

Carrier

GENTLEMEN: At

from $398,529,-

rose

pany's annual report.
ber

in

Fund's

re-investing

the

review

management
ress

the

were

of

*

STREET

2?/',

and

$472,360,654, an increase of
$74,830,860, during the fiscal year
ended Sept. 30, the Fund's share¬

stocks

the

mu¬

794 to

6.6

6.6

Gas

and

Investors

managed by Investors Diversified

Analysis

11.6

Chemicals
Natural

1952

22.8'/o

Electronics

and

of

tual fund affiliates sponsored

holders

of

preceding

and

and

$6.51 compared with $6.74 on Nov.

companies in

the total net assets.

•CALVIN ButLOCK

assets

Gain in Year

securities, other than

notes,

WALL

NET

Mutual, Inc., largest of three

sale

ernment securities and short-term

ONE

on

on

gains from

Purchases
ment

their ability

on

all the rail stocks
7.38% and that they

is

own

the

64%

as

A

year.

tor the fact that the in¬

yield

securities.

local dealer.

be

to

seems

This attitude doubtless

sq^

accounts

dicated

burden;

interest
still

the

and

years,

reduced

Dec. 24, after
the close of the fiscal year, from
was

recent

greatly

$2 Million Gain

tifiilicncit

of

nance

MIGSF

in

shareholders
dividends

substantially

was

than

About

year.

present very modest

price to earnings.

of

Moreau

a

ratio of
That they ca.ji
perform in this fashion in a busi¬

securities

prices early this month has been
the

magnitude

before

power,

will

Bar¬

demonstrate

and

unheard-of

curities

disturbing

"ONE RATHER

the

whatever

of

face,

we

throughout the coming year."

Prospectus from

live

to

period,

Mr.

from

the
carriers will
through a recession

0.4%

goods

moderate-in¬
York City

New

since April of this year.

profits

smaller

from

"that

declined

in

rity

physical condition.
be," the Delaware di¬

learned

families

come

of

by

first

ives.

improvement

and
may

able to

was

bought

income in 1953 than in
19o2, al¬
though the distribution from secu¬

and the
in balance

ringer,

should

threat

continual

earnings

rectors

or

negotia¬

and

have

tinuance in 1954 of the prosperous
conditions now prevailing.
Pay¬
at

1954,

wages.

of

historic

econ¬

a

higher

level

fundamental

the

of the American

earnings,

factors

strong

a

forecasts of lower load¬

For

average.

These relative
apparently out¬
weighed the tremendous absolute

their liberal

dividend

are

emphasized
of

toward

the

and

not

was

slightly larger dividend (63
per share) from investment

ered

tions with the Brotherhoods have

business calamity

a

contrary,

soundness

of

on

ings

manage¬

making.

the

point

gain
three

will show only a small gain over

apparently do not share in

"On

time gave up

its niggardly

low

earnings," Mr. Bar¬
ringer went on, "are generally
running a little below last year,
and railroad earnings for the year

pes¬

analysts,

the view that
is

the

"Railroad

many

dividends, despite

market

ments

September-De¬

same

nearly half of

in the Corpo¬
Lexington port¬
folios, Mr. Field said, "Inasmuch
as
leaders of industry have seen

and

its

in the

average

since

increase

fit to raise

of

rise, and the utility aver¬
a tenth.
But the railroad

lost

age

rate Leaders and

NATIONAL SECURITIES &

quarter

months ago.

that

dividend

PROSPECTUS

"Be¬

high of Dec. 3 and low

15, the Dow-Jones Indus¬
Average lost a little less than

cember

Certificates.

FOLDER AND

direc¬

of Dec.

Renyx, Field & Co., Inc. is sponsor
of
Lexington
Trust
Fund
and
Corporate Leaders Trust Fund

WRITE FOR

the

Fund.

Delaware

tween the

addressing the Di¬
visional Managers Annual Meet¬
ing
at
the
Hotel
Commodore.

SECURITIES

to

the Fund

years,

pay a
cents

the

which

year

PRICES

RETAIL

services

characterized
by
the
generally
rising securities prices of the past

with J. A. Hogle & Co.
"JUDGING

a

rise of

a

Thursday, December 31, 1953

.

..

Number 5286...The Commercial and Financial Chronicle

Volume 178

27

(2651)
4

Securities

Our

Reporter

Salesman's

Bank andInsurance Stocks

Governments

on

By JOHN T. CHIPPENDALE, JR.

By H. E. JOHNSON

The government market is turning towards the new year with

Corner

a

definite

what

feeling of confidence which is the direct opposite of
The change in monetary

expected at the close of 1952.

was

policy since the middle of

By JOHN DUTTON

is the

1953

principal

'A friend wrote me the follow¬

^

ing letter and I liked it so much I
thought it would be nice to share
it with you:
DEAR

is

personal

a

It

the powers
that be have learned their lesson after the unfortunate happenings
of 1953 and, as a result, will be much more flexible in meeting
new conditions as they develop. Speed of action is likewise impor¬
tant but on this score the money managers have demonstrated

greeting

all

After

to

is

and

said

and

done

been

who may feel disposed—as I do—

unusual

to

of the year, the changes
the 1952 year-end to the 1953
minor

beyond

the

current

ex¬

pressions for the Season's deeper

spread

the

for

record

the

has
in spite of
year

the books, as is the case with 1953,
developments that took place

on

sensational

and

in

the

which have been registered from
year-end are very much on the

course

sid% One thing is definite, however, the year 1953 showed

significance.
Whatever may be our inherited
customs and religious faiths we

that

celebrate

policy.

-

the

birth

of, one

man

securities can fluctuate as well as corporates,
other obligations when not protected by monetary

government

municipals

or

in Retrospect

19&3

ings support

continuing^
and harmony .among All

month period has now moved along into histofy, the records show

-

-

-seasonr^whei^^^^^r^ thaf ^many

o£ the then- unusual happenings have

the

gone

of

way

sympathies^he. "V
T
.
,
: . u
the afflicted, the oppressed,
a11
with the passing of time. In view of the manner in which
the money markets ended the year in comparison with where they
the under-privileged, and the mis¬
our-*

..

„

We

renew

faith

our

that

they will have years of happiness,
the boon of health, freedom from
tyranny, the security of prosper¬
ity and the gift of wisdom.
Because

these

at the close of

were

ado about

to

tant

confidence in the future,
the expectation of happiness

men,

for

ourselves

most

and

dear to

those

who

are

though the expression "Much

as

Treasjyiry bills which were increased rather substantially dur¬
were

are

1952, it seems

iNothing" would not be amiss in this particular instance.

ing 1953 in order to finance

blessings to
which we are able and privileged
to contribute, I join with
you in
grateful expressions of goodwill
and

last

of

was

a

Since that time it has declined
stood

week

194.87.

at

is

It

slightly and at the

still

at the

close

The yield

1952.

of

change, and

As

1953 is

impor¬

an

The increased supply has kept rates of

obligations at levels where

91-day

been

bank

funds

important amount of

an

been invested

have

them.

in

development which

anti-inflationary

an

the earlief part of

to

As of Dec. 31, 1952, the Dow-Jones

^t 291.90.

of

1952, the decline amounting to 11.90 points in the

The overall index of the

with individual groups or
better than

much

acting

stock

the

"averages" obscures certain changes

with particular stocks which have acted
For example some of the better

average.

this

groups

include

year

electrical

Amid all the

pre¬

This

has

important

was

of these shares is

higher than 12 months

Of

course

has

groups

the action of individual stocks within the respective

gains

greater

far

been

uniform,

from

losses

or

in

or

with

against the general trend.

dictions and

prophecies of things
to come,
many of us who are en¬
gaged in sales work have the ben¬
of, patient ^building

years

behind

To those

us.

new

men

in

about 0.40%

of

4*Build

extent take care of itself.

have lived through

I

„

1929—1

remember

1934—I

came

1942

1930

and

1937

some

who have survived two

three

wars

business

severe

and

since 1925, as I have done, is—
There
is
nothing much
worth

iporryinq

if

over

you

only

can

keep well and you can remember
that things will work out if you
a chance to do so. This
for the young men and
have recently joined

give them
also

goes

who

women

the ranks of those of

been buying and
We
as

or

have

may

it

business conditions,

have

may

we

business,

falling off in

a

don't

I

know.

But

thing I do know and that is
tain—those
can

to

make

of

who

us

partial

a

our own

are

extent

what

year

been

started

in

selling

least

at

we want

/

Indeed, one might

that selectivity rather than any general

say

trend has been the dominant factor in the market action over the

past year.

.

Keeping this in mind it is

Times and conditions have much
with the resuUs that

to do

achieved but what is in

the

minds,

and

our

our

faith

in

the

c^n

our

be

prior

after

soon

the

the

bill

Treasury

somewhat

,,

,

,

.

the

beliefs

,,

,

hardening

money

.

have given

securities

,

Administration

1953

of

one

the

The

64%

27%
61 %.

for

by the

liquidity

any

preference became

bond

coming into

power

and

^hat tighter money poli¬
These

quotations of government
and

most

rapid

on

Treasury bills,
of

9/15/67-72

"Humphrey"

was

the managers
as

"Banks")

(the

3%s

There

the uncertain position of the

because of

going

was

a

down

fell

to

sympathetic

out

of

89%

bed

along

before

price

decline

among

all

was

the

other
these

issues

policy of easier

a

money

by the

been

the year

also

con¬

success

in

ahead.

here's

So

of

to

done
it

is

has

its

that

"a good

own

always

look

job well

reward"; and

been

land of ours, so

now

seven

1954—let's

ahead with courage and with the
conviction

are

in

this

as

good

it will be.

HAPPY NEW YEAR TO ALL !




sensational

as

above

the

decline.

3%s

of

6/15/78-83

points above the issue price and more than

and will most likely

abd^e the
to

The

67

45%

5%

86%

67%

1

74%

"61%

3%

64%

52

28%

23%

~1%

63%

55y4

%

41%

—

America

44

—______

+

+
—

42

170

76%
103

37%
25

47

Fire—

Westchester Fire

36%

81%

66

3%

50

41%

—

39%

S.

42%

2%

+

47%

35
48%

U.

—

34%

+
—

52%

—

—

26

—

1%

35%

28%

4%

41%

31%

4

53%

43%

9%

47

35%

1

26%

21

17 show declines as compared with the

higher in spite of the fact that the

measured by the index has
The

Only six are

America
Other

Fund

are

San

of

gained 4.31%.

with

Francisco, Insurance Company of North

Paul Fire & Marine showing smaller increases.

and St.

gains

level of prices as

has been made by Continental Casualty

best gain

Fireman's

89

108

4

prices at the end of 1952 and two are unchanged.
actually

35%
148

—~4%

42%

Security Insurance
Springfield Fire & Marine

Fire &

3%

176

99
35%

Insurance

34

42

minor.

In view of cross

currents in the industry at present and the

variations in underwriting expected in the coming year, the se¬
lectivity present in the market is

likely to continue into 1954.

HAPPY NEW YEAR TO

ALL !

B%

1952

quoted

and

year-end

95.18

finish the year more than

price.

The

"Bank"

2% %

bid at the close of 1952, also

should finish

the

Merrill Lynch

Adds

(Special to The Financial Chronicle)

CHICAGO,
has

been

Merrill

111.—Henry

added

Lynch,

to

the

Ziemba
staff

of

The Chase National Bank

of the

Pierce, Fenner &

Beane, Board of Trade Building.

City of New York

Bulletin

on

Request

The Vic's, the 2%% due

closed, at 95.14 bid at the end of 1952, went as low

ih*1953

9/15/67-72^was
down

was

points above the low for the year.

89%

point

as

almost six

12./15/67-72
as

72%

54%

—

Marine.--

Paul

St.

monetary

each

will

Hampshire

Phoenix

debacle of last May and

being adopted

authorities, quotations of Treasury obligations turned around. The

tasks,

971/4

during the month of May.

Monetary policy changed after the
with

___.

No.

of

Treasury bonds with the lows for the year being made in

improvement in prices of Treasury securities since last May has

to our share

Co.

with the.

decline

the

future, and the

day's

—

Insur.
New

38%
170
38%
79%

Fire

Insurance

3%% Treas¬

The 2%s due 12/15/67^72, the Vic's and the 2%s

markets.

halted.

Falls Insurance

Great American

Home

constructive energies we apply to

tribute

Glens

Hartford Fire

floated at 100 and this issue* proceeded to go down

was

quickly to 98%

money

due

investors

paramount feature as far

a

31 %

3%

—

41%

of

Rebound

issues, aside from

39

821/2

—

60%

needs

money^tightemn^'^policies

53%

5%

27%

41

22%

64V4

+ 11%
5%

60%

(Newark)

27

26%

—

71%.

Fund

Of the 25 stocks listed,

market

—

83%

Fireman's

investors in government securities were concerned. A

very

77%
70%

36%

"'%

+

54%

Firemen's

_

sharpest

$r

74^
50%

*

demoralized

94%

_____

38%^

Low

50%

%

—

33

—

7

—

59%

Treasury

would be seen for Treasury bonds.

was

—,

26%

Employers Group
Fidelity-Phenix
Fire Assoc. of Philadelphia

Hanover

_

was

decline that took place in

in

record.

which

proved to be well founded by events that followed

were

the

process

conditions.

Price Decline and

new

Insurance

36%

in popularity to

way

to meet the

seems

^

lower prices

because

ury

...

.

Administration took office,

new

the opinion of the money markets

and

and

a

Boston

High

64

9

—

60

—

Casualty

bondjf at the finish of 1952 were in an uncertain

position because

cies

with fhigher

Surety

Insurance

^

Bond

Treasury

was

securities

American

29%

—

Insurance

Continental

to

which

„

.

it

these

American

1953 Price Rtnge

Change

64%

26

Agricultural Insurance

1953!

Point

12-31-52

55%

—.

Continental

under existing

better

'

hearts

convictions,

Im¬

of 1952.

Fire

Aetna

price

interesting to review the

12-30-53

However,

,

it to be.
i

showing yields

were

moving

This fact is evident in the market action of insurance shares.

l%% obligation was used by the Treas-

certificates and notes appear to

one

cer¬

a,

..

use

actually

'

.

had

.

this flotation brought the rate down to the level which

who have

us

selling securities.
good 1954 as far

a

concerns

had

....

.

,

and

recessions

1953

of

outstanding at the end of 1952.

were

finish of 1953

ury and

all

I can say to
of the rest of the old timers

period and

of

market 4ssues

rates than

coupon

through

through

and

O.K.,

?

1928

close

below where they were at the end

into; the

brought

solidly,

try aiid do
your best for your clients, work
consistently day after dan, and
keep on doing a good job'Ipr the,/
people who do business with you."
Then your 1954 will to a large

the

by

portant operations by the Treasury in the course of the past year

^"*■the
say,

notes

and

stocks showing

some

instances

some

changes of 25 of the leading insurance stocks for

certificates

Treasury

The index

ago.

On the other hand groups such as automobiles, copper & lead,
drugs, farm equipment, oil, textiles and tobacco have dpne very
poorly with current prices substantially below those of a year ago.

in

1953.

made up the losses of the summer

manufacturing,

aircraft

equipment, food, grocery chains, and paper.

-Bid Price

It is now the time to look ahead

to another year.

of

level

this, the general level of equity prices is
Industrial Average was
After establishing a high of 293.79 in the early part of
January, it moved irregularly lower reaching a low of 255.49 the
middle of September. It has subsequently rallied to the present
level around 280. However, it is still below the level prevailing
compared

lower.

which has been able to resist the trend of

one

the year's developments.

the

were

differential between the shortest

government securities at the close of 1952 and

non-deposit
yours,

❖

V

efit

the

in the index.

larger part of the Treasury deficit

a

yielding about 0.35% less at the end of 1953 than they

us.

Cordially
(signed)
•

above

existing at the end of 1952 with the gain amounting to 8.06 points

.

.

young,

guided.

of November.

^^^lU^I^Sa^^^r^^ensational

Theyear

V.

^

It- is the

affirm

31, 1952
declining to

our;,

and specsince this 12-

men.

and

average.

andnations and.races of •

for peace

classes

as compiled by "Barron's"
186.81. After fluctuating in a narrow range
low of 169.68 reached in the spring of the year,
the index moved upward to a high of 200.29 attained the middle

Dec.

at the end

in

Insurance Stocks

—

The index of insurance stock prices

on

end

those of my iriends and associates
look

market.

their ability.

JOHN:

This

the

for

reason

constructive attitude that prevails in the government
is the opinion of many money market specialists that

This Week

Considering the action of tlie general equity market in 1953,
the performance of the casualty and fire insurance group has been
relatively favorable.

year

1953 about

1%

ALL !

due

sold

points

the^l952 closing quotation—"Much ado about What."
HAPPY NEW YEAR TO

a

With First of Michigan

Laird, Bisseii & Meeds

(Special to The Financial Chronicle)

DETROIT,

Mich.

—

Members New York Stock

Charles L.

Guess, has become connected with
First
of
Michigan
Corporation,
Buhl

Building,

notroit

Rtnrk

members

F.xrhanee.

of

the
"*

Members American
120

Exchange

Stock Exchange

BROADWAY, NEW YORK 5, N.
Telephone: BArclay 7-3500
Bell

Y.

Teletype—NY 1-1248-49

(L. A. Gibbs, Manager

Trading Dept.)

Specialists in Bank Stocks

The Commercial and Financial Chronicle

(2652)

?8

MR. TUCKER

Continued jrom first page

Looks

for

In

...

than

cars

pression.

of

Department

S.

U.

.

We have

.

.

.

Boarded win B.

trial Conference

street, Inc.; A. D. H. Kapla", The

Steel

Economist,

Motors
The

.

of

the

For

turn

three

last

to

me

the

in

past

have

me

have

to

to

channel
into

the

nondurable

present

r

very

had

mild

perhaps

order,
on

would take

I
t

pothesis

that

for

rate

city! y

.

a

the

next

80%

nearer

as

of

capa¬

summer,

■Jin tjh£. late summer, there will be
a low!

Sees
At
>

aTIigh

Continuing

con¬

struction volume for next year to
Le q<ute

mild.

Residential con¬
expenditures
in
1954

struction

(will)

..

.

prob¬

fense

year's

can't

year,

f

(I

t i t)

activity

the

Lave

,

We

certain

commercial

the
A

green

Holden

;
types

of

important
that

got

light the first of 1953.

There is ^tremendous backlog of

geed. Ver^f^jv cities have had any
Sizable amount of new office build¬
ing

space

created

since




the

de-

.

.

the

in

rest in

month

of

ports

expend-!

this

other hand

the

gains

to

k coax

shell out

less

Profits

Gut

cut

.

it isn't

.

way

efforts

than

to

of

worthiness

he

•

•

which the
gives to industry*. I

gov¬
.

.

.

any
ex¬

dis¬

.

1 i

n

will

more

not

charac-

t

ri

e

s

t i

durable
than

of

capitalize

mean

the

on.

the

11

the

in

personal

2%

liquid

of

.

be

Alexander

ex¬

to

be off

the

situation
.

.

are

up

(that)
we will

If

to

.

see

bargains
to

they

sure

during

the

retailers becom¬

but

keep up
do that'I
what

keep. it,
be.

to

up;

in

consumers

their
am

they

volume.

not

may

but gross

at

all

be able

profits

q^peeued to.be lower.-n

a,

'

high

relatively

unemployment to prqyent

*

iJ

'

year ahead-that we would have on

fully

the
r^e^ ?s'

from

levels.

abroad

general, fore-,
•f

for
con-

also going to
.

,

.

P™Ve ri^Myro)vn^we^ would:
be somewhere; arout)d;.4% or,2.S

become

nullmns/-Employment;may,dfPP

This will

keener.

^^.but^y^kers,'

substantial loss in Ameri-

in

.

Wl11,

leave the labor force.

MR.
No

Further

On

the

f

billion in the first

abouts

billion

rate

of

quar¬

there¬

or

.

.

eral

have

year.

First

you

Legislation

have

.

.

the

probable

Neither organized

.

business community

for

production.
restrictions

major

on

sions

cot¬

on

of

dar

1954

be

will

1

port

-

will continue

1

by
Edwin B. George

Humphrey....
the-

con¬

ventional budget. There- would be

M.

y

1954.

can

is part

That

it stands

as

far

concerned
yery
we

to

basic

commodities

\

respect

be
Wk
.Nathan

So

.

.

.

Koffsky

be

sustained

1954,

we.

a

in

.

na¬

.

seems

It

.

quite

is

demand
it

is

down
.

.

.

level which
fiscal

cannot

see

likely that

we

shall

of the legis¬

while

think that it is at

in

ture.

'

sharply from fiscal 1952,

For

are

they

relatively

minor

now.

foreign

as

changes

(are likely to)

be

sup¬

of

no

the

However,

if

lation

Secretary
with

Act.

made

in

an¬

ticipated

expect

Taft-Hartley

of

will

not

occur.

change in

com¬

that 90%

than

that

I

pro-

Another

somewhat

calen¬

higher

on

cut

corn

revi¬

are

likely to

'factor

too

that

modities.

I

as

cares

the Taft-Hartley
knowing
perfectly

revision,

well

wheat,

labor nor

much to open up

in

Acreage

those

forecast,

is

pressure
of
prices will be intensi¬

on

next

duction

Fed¬

half

This

DOHERTY

Expects No New Labor

ably

*

v

spending

behaves

we

ton, and prob¬

the

1954.
If

1954,

the

will

in

last quarter of
.

that

! reductions
a

somewhere in the

hour.

Decline

MR.

Deficit

say

Farm

feel

some

from

.

neighborhood of 5 to 8 cents per

Looking ahead in

...

fied

gently

.

•

KOFFSKY

do

I

declining

will

year

out, I* would

be¬

personal

I have defense expenditures

.

My guess is that next

supplies

coming

increasingly price-conscious
increasingly anxious to pre¬

order

income,

.

some¬

level of

reopening clause.

a

takqs

.

Widening

a

...

stocks

now

production

positive reversal

a

ter of 1954 to $50

somewhat.

It

industrial and

third? markets is;

or

a

don't

The outlook for profits does not. the annual
rate of deficit"
too good in retailing.
I
in the secondthink

sent

.

about $51

S.

all

be opened as a Whole, rather than

simply under

-

reasons.

other parts of the world.

income-

expenditures.

...

Federal

Ralph

ex-

exports to South America and

ean

GEORGE

Sees

In

respect
to
retailers during

and

4%

and

expect

MR.

probabil¬
sales

ing

middle

prewar

increasingly

non¬
...

Europe has

Mte

spring of 1955.

of

c

and

neutral:

*

of the downward trend before the

goods

with

(This)^^yment^tbe^ and early,

States

attrac¬

.

consumption

be

other

also

' :

two Competition

V!,:

\

.

.

tween

(in

e

sales)

also

but

provisions of the agreement. More
of the significant agreements will

If you contemplate the year
section of our population.
show an export balance of not ahead
with ^ unemployment less
I foresee 1954 as a year which as more than $2 billion to .$2.5 bil- than 5%, with (the) cost of living
lion. I think you can look forward relatively stable, I would expect
a whole will be moderately under
to a steady improvement in the average hourly earnings to go up.
1953.
My estimate is
in
terms of a range rather than a balance-of-payments
position
of How
much? Since the groundfixed figure—between 3% and 8% the world rather than the reverse, rules require us to stick our necks
decline

(The) de-

.

.

p e r-

income.

aid,

only with) general

changes

wage

neces-.

did
:

more

demand,

of

economic

for

and the increased credit¬

the

and

O. Glenn Saxon

wages from, rising in our economy. ::

expects regained its
of violent price agricultural

off if tied, to

pay

.

.

position to supply products needed
rehabilitation abroad,

On

More positive selling effort

...

of

consumer

today

more

a/S,l?rp decline-in-"U*.'S. ;exports. Other nations were in no

bar¬

yet

be

anticipate
industrial un¬

will be accentuated next year due 1550
a^till wages Jose---;
tremendous bar-* to the fact that so much of Euro- or certainly total compensationUt;
the- consumer to peon aid-came 'from the United
would^eermto^me-unlikely mThe ,

three years ago*

or

elasticity

in

The

the

come

f

of

amount

of his accumulated

some

,.

in

.

have

to

sary

Dr.

or

are

can

I

1954 than in 1953.

concerned (not

-

There

peace

a larger num¬
significant contracts opened
in 1954.
Negotiations will be

certain to fall extremely

are

T

relations

ber of

re-

elimination

1954

There will be

...

goods

heavy

1954.

considerably

through
ship¬

duction

in

industrial

.

expected

After past wars, there has always

hadn't

in

in

year,

construction

The

.

v'/y

Moderate Advance

degree of industrial

earlier. With

.

.

any

has
been
unusually
quiet. I do not think that the same

be¬

committed

pro¬

of the feeling that the

.

S.

Rates

Wage
.

scene

effective

significant sharply.

a

consumer

look
Thomas

peak

substantial

A

.

time

up.

to

year.

have

we

where between 5% and 10% over
what they were at the same time
last year. . . . Their costs are

n

roughout

may

/

v

can:

sizable

a

istic. -Their

continue
t h

which

1954,
the
picture is, to my mind, not optim¬

in commercial
r u c

which

ments of

1954,

.

cline

of

1,-

uptrend

const

itures for

,v'

demand

With

expect)

e

of

physical

in

up

.

see

;

a

.

actual

an accumula¬
pointing to a

in

the

end

lowering

cept some, de¬

pected

900,000.
I h

postwar

expect

don't

DUNLOP

In

economic

of

aid

our

I

year,

Forecasts

volurhe

great

of

shortage

not

do

from

will

1953

reserves

outcome

or

perhaps

I

de¬

see

may

990,000'

next

is

automobiles

on

housing starts.
.

MR.

because of the

no

acute

against

the declines

duction

during

supports

ernment

ity

total.

same

—

expenditures

various

a

.10% from this
The

There is

.

this

(up)

compared

year as

.

inflated

Psychology
of

conditions

of

that

..

because

Retailers'

durable.

1?e down

ably

.

close,

a

recession.

...

decline in the dur¬

a

be,

there

If

c

Level

(I Ck^ect) the recession in

tion

services and nondurables.

in

sonal

Construction

total

has its first opportunity

be tested

to

goods.

abnormal

posable
HOLDEN

MR.

.

in

largely

lion,

.

would

100%

The

.

prices and income hold

non-agricultural with

a

-

,

fairly well next

ports averaged
about $15 bil¬

came

era

to

economy

tive

steel
be

average

sometime next

.

■

drawn

but

rather,

;

sectors

well

Sees

working hy-

year

than

■

the

changes

(
:

.

.

If

although perhaps

.

1954
.
.
should be further reduction in farm masharply, but not as sharply chinery purchases and, as a matter

years

MR. ALEXANDER

record.
.

next year, . .
shade lower.

1952, total ex¬

the peak now and

near

Consumer

savings.

the

even

; '0

agricultural products. In 1951- of fact, there might well be some
mild improvement.

as

KAPLAN

With

expect any significant

goods
an

rise

t>e down around 160.... The pres¬
ent recession is going to be on a
mildest

be

of another inflation
sales by the same method.

On

would - be
more
than offset, in my judgment, by a

it would

them

of

March.

last

appliances-—it

recession
parallels
the
average of them, ? it would: be
down; around 180; and if it paral¬
the worst

personal tax
spending for

in

gains

in those two

year

present

lels

since
should

for automobiles and to a
considerable extent -in electrical

the

If

not

If there is

recessions,

summer.

turned and was

American

.

.

down

decreasing

gain

index would be down around 200
next

.

exports

ago.

cause

theh the Federal Reserve Board's

sometime

10 years

or

gardless of the trend in the gen¬

the

past

at

Exports Will be Down

consumption is still held back be¬

able

these

of

five

eral economy.

the

parallels

recession

"

take

tional product. My expectation is
that rents will keep on rising re¬

8,"hnd
If

do

much

a

...

SAXON

MR.

that the

show, but ... I don't
them as seriously as I did

MR.

the first two quarters of next year
in personal income or gross na¬

1937-

...

war,

be

decline from current rates

1949.

Bradford B. Smith

a

this

income

.

.

1952.
.
On farm income in 1954:
we
would look for a little reduction
in the gross, largely because of a
smaller wheat crop and a smaller
cotton crop. We would also look
for some reduction in farm production expenses, and for the net
income to be not much different

formulae

prospect

refriger¬

this additional

.

All this adds up to

year.

.

1921;

-

9 3

$50
—

not

will,

I

1924;:

n

consumers

Paradiso

Lotiis' J.

were

1920

billion

social insurance.

curves

should turn down.
o

ators,

1907-1908;

'1

the

Tucker

a

average

or

recessions

of

tax

during fiscal 1956 un-

receipts and cuts in

700,000 if disposable income were
the same as in 1953. That is what

automobiles

situation.

the

will

first-half

in

$15

exceed

offsetting

as

be¬

4,150,000 if the disposable income
were 3%
less than in 1953, or 4,-

enough to buy

I

the present

They

on

small

will

some

similarities

S.

New credit has been

...

person

which

to

seem

1

around

selected

few

a

we

get

the

prominent. On

mildest

assume

amount,

been

basis

is

as

the

figure for 1954 might go as low as

the

reduction

Jan.

spirals have

that

.

With

,

rather

which

not

.

in taxes which

should look to the

we

of

Rufus

these

.

will

vicious financial

the

.

the

parallels it accordingly

recessions

.

rising sharply enough to produce

variability

of output

.

.

.

demand for food will be just about
as strong next year as it was this

.

.

personal

of

activity had

less

sold in 1954. If

the

the low

on

side.

SMITH

seems

.

.

.

the cash deficit would

.

.

time

some

have

might

un¬

up.

years

purchases have been

Corporation.

our

.

probably

otherwise

we

the purchases

.

following are highlights of

For

rate of outgo

moderately

of 1955,

that

cars

show

For next year
nondurables will

.

On the Business Cycle and Steel

i.

1953

school

a

.

.

Should business continue to

...

decline

in

sold

have

Rise in Soft Goods

a

we

V

scheduled,

as

the- rate

exceed

a

fore

the remarks made by participants:
MR.

made

are

the annual

tion is that we

Services

And

R u f u s
S.
General

Corporation;

.

point

the

"

Expects

ics, Yale University; Bradford B.
Smith, Economist, United States
Tucker,

...

to

.

.

.

great

Professor Econom¬

Saxon,

in

are

of

in

.

receipts plus the accrual rate for more stable price, situation for
of
corporate and other tax liabilities agricultural products in 1954 than
years.
The
we have had since the summer of
only explana¬ by around $15 billion.

PARADISO

MR.

off

.

absolutely
precedented proportions.
building boom

Brookings Institution; Clyde L.
Rogers,
Vice-President, National
Industrial Conference Board; O.
Glenn

We

considerably.

Economist, Dun & Brad-

George,

.

picture,

period

Suburban
President, Bankers Trust Com¬
neighborhood shop¬
pany;
Helen Slade, Managing ping centers, covering quite large
Editor, "The Analysts Journal."
areas
with large parking spaces,
Forum
members
participating have been on the increase in re¬
included:
Jules Backman,
Pro¬ cent years and will probably con¬
fessor of Economics, New
York tinue to increase.
Highway
University; Martin R. Gainsbrugh, roadside developments, motels and
Chief Economist, National Indus¬ so on are due to increase very
.

falls

any

over

runs

total

If

.

demand

.

cuts

formula that

consider¬

a

by

domestic

.

and

fied

deficit.

cash

the

demand

more

antici¬

generally

was

able shortage.

Commerce; Roy L. Reierson, Vice-

lot

a

circumstances the

such

(While) granting :
some little
I lowering in economic activity,
;
project—an average of about $351 (we feel that) the flow of income
billion gross national product in to consumers,
will be mainsecond-half 1954—and all four tax tained very well/
Consumer
in

sold

we

pated at the beginning of the year
a lot more than can be justi¬

On 1954 Business Outlook
Economics,

1953

in- thing significantly lower

proportional

(a)

under

crease

Auto Volume

Economists Present Views

than

more

in

Decline

a

.Thursday, December 31, 1953

..

the

A d

tration

Richard

P.

Doherty

increasingly

giving

its

major support to higher minimum
wages.

1954.
any-

find

minis-

.

of

v

.

General

industrial

business

in

terms

production .will^ be_

*-'•

Volume 178

/

Number 5286

.

The Commercial and Financial Chronicle

.

(2653)
off in

the

neighborhood of 8% to

10% from the 1953 level.
or

to continue downward.
finance

1955

...

possibly late 1954 should wit¬

ness

gradual upturn from

a

first

to

1953

are

ex¬

materially behind
year's total in 1954.

the current
The

of

half

fall

.

volume

of State

and

.

.

munic¬

ipal financing, on the other hand,
is expected about to match the

trends,

record set in

ally

overtime

disappear,

have

a

virtu¬

which

...

weekly

the

1953.

that

elements

present in

will

Outstanding

however,

economy,

substantial
resist

as

the

sys¬

...

high savings, high assets, and high
net

worth

sition

position

of

the

of

...

well.

business

decline of

po¬

enterprise

The anticipated

5%

even

in

gross

na¬

tional product in 1954 would still
leave us with the nation's
second
best year in terms of total eco¬

con¬

and the highly liquid

sumer,

as

levels of

nomic activity.

Sees

Continued

Selective

a

3

page

Securities Market
.

Recession, and

Moderate

Reserve
in

Decline

a

in

17%.

I

will

be

15%

to

think

ing

that

with

lower.

!>.

,

choice
there

decreases

profits,

-V

will

they

not be of

to

ume

to

in

sufficient vol¬

|ielen Slade

we

-

be slight

may

be

to

the

While

pre¬

vent

paying of dividends. Such is
especially true in the railroad
field.
Highly profitable ventures

in-

Dr.'Jiilet Backman .-0 ventory reces1

.?:
>*'4 sion, >aJ plant
equipment recession, shn autore-

for 1954 will abound in the shares
of
both
old
and
new
chemical

f "cession, * , and $ government
will
probably / be i- neutral or J, minus.

companies. Of great merit, al¬
though in some instances, slow in

and

.

mobile-rrecession,*

«•

.housing

a

*•

That to

adds up to
•setback than in 1949.
.

.

me

The

.

visage

.*■

recession

and

•continue

which

that

I

starting

sharper

a

I

shares

mean

impact.

•consumers'... price

As far
index

office

.

.

MR.

There

by

moderate drop in prices of

Clothing,
'The

.decline

could

'

t

"

■

.' 1

,
_

'

Mild

a

And Easing Demand for Money

Assuming

some

level

partici¬
individual

the

As best

individual

of

1951

to

Marks

DM

8.45

in

and are redeemable within

rela¬

a

easing

in

the

economic

of

ac¬

than the average

return

Ger¬

on

equity issues. This unusual
situation is partly due, of
course,
to the unfortunate past
experience
of

fered

terrible

losses

in

the

»

pected

rate

tation of lower
in

rates

is

the

no

parallels

prem¬

quently

to

be

lower

a

with

in

starts

1954

10%

level

and

develop

modest

in 1954.

decline

in

total dollar volume

In

.

1954,

present

(4)
the
of

A fairly

country's

business.

prospects

modestly, by perhaps 5%

are

less,
*with business loans registering the
most significant reduction and the
more

real
to

estate

Bank

mortgages

being
holdings of
are

continue to expand in
Private

In

1954

or

in consumer loans

moderate.

long-term

also

Ibelow 1953.

are

other

any

business

recent

$80 and $85 billion.

.

between

1954.

of

likely

1954.

Not

Government

spending nor
larger impact on income,

even

have

entered

the

German

market.

price

The

expected

to

be

Corporations, because

<of lower plant

outlays and greater
Internal financing, are
likely to
issue
substantially
fewer
new
money securities.
The volume of
mtility financing is expected to be
•as large next
year as in 1953, but
the amount of securities issued by

manufacturing companies is likely




.

on

of

level

trends

but

it

is

is

not

known

to

a

was

for

1954

the

that

bring

to

.

of

.

That
about

billion in total

economic

in

15%

.

reduction

activity.
The
decline
of
10%-

accompanying

an

compared

FRB

index

index

with

would

(unrevised)

average

of 195-205

about

228

in
as

cur¬

rently.
.

.

.

Examination

lead
an

of

individual

original'and

equalization' wit

towards
even

strument

of

mark

'

account

making

more

sperr¬

desirable in¬

investment.

The Bonn Government's present!
of a free economy points to

aim

New York Stock Exch.

Weekly Firm Changes
The New York Stock Exchange
has announced the following fir; n

changes:
Allan

•

C.

Carrol
from

House

retires

from

that

trying

are

sperrmark

While

eign

investor

offers

the

the

for¬

attraction

Deutsche

Mark)

circulation.

as¬

sume

the

market

risk

sperrmark fluctuations

of
as

daily

well

as

security price changes.

gations by
Of

German businessmen
German

foreign

markets.

are

capital

extreme

importance

is

Bank

Building.

Samuel
a

rency.

With

tourist

demand

mark

relatively

a

ited amounts

and

these

marks

hotels,

for

food

steady

West 42nd

Opfcns 7

engaging
from

hi

(jffic£s

Street, New York
—

L. M. Boos Co. Formed
ki

FT.
Boos

_

WORTH, Tex.—Mrs
is

conducting

a

^Securities

lim¬

business from offices at the Stuart

sperr¬

would

Building under the firm haViie of

be

spend

services, such

and

business

t-v*.

the

easily

can

Travelers

is

•

City.

cur¬

rather

involved, such

purchases

watched.

sound

Axelrod

securities

at 11

fact that this plan can be put into
without endangering

already

■

.

Samuel Axelrod

operation

Germany's

the Eftrt

offices in

„

L.

_T

„

M.

7/01

_

Boos

.

Co.

■

|;

as

••••.

on

.a

transportation

and luxury items inside

Germany.

Also, the G. F. R.

can reply upon
larger number of tourists from

a

Germany al¬
ready has credit balances.

eager

the

are

They

to

in¬

terested in opening up new cred¬
its and in finding more funds to

Naturally, foreign confidence in
the security and safety of present
German issues must be reestab¬
lished before any large scale for¬

eign lending will follow.
in this direction would

from

National

neighboring European countries—

Capital

attract

like amount.

a

.

6.

Tex.—Robert

countries with whom

Germany Eager for Foreign

to

Each such mark spent

by foreign travelers would reduce
Germany's foreign exchange obli¬

of

he must

foreign

and
travelers
entering
Germany the marks would
gradually and'what is more im¬
portant, steadily disappear from

buying securities at a discount
(sperrmark being quoted at a dis¬
count of approximately 30% from
the

WORTH,

tourists

to

(blocked marks)

sperrmark

by

withdraw.?

Wilson is engaging in a securities

West

capital market is

bankers

used

&

*

Hoffman

J.

House

R. G. Wilson Opens
FT.

Worth

be

Curtiss,

Co., Dec. 31.

marks

could

in

partnership in Draper, £>ears

business

When put into effect, this "tour¬
ist-allowance" plan would result
in

needed

a

steady

of

source

sperrmark

of

basis

and

mark

outstanding

it

$20 billion to $25
national

German

balances

85%

of activity
rather than

of

amounts

freeing the

Mark.

And

the level

gross national product
1954 that would be, say, 5% to

in

(c) pave the way to
Bonn Government's
principal

the general Forum

year-end, led
higher level

built from sector accounts
a

and

supply to German industry. Certaintly a greater supply of capital

over-all

an

the

with

its
nor

a

activity in the

think

Such

of blocked

ment to free these marks for travel
and similar purposes.
If blocked

se¬

.

"

I

fact

a

—

three-fold ef¬

a

would tend to lower present high
interest costs.

economic

...

na¬

year

the

by

of

consensus

standing

the

buyers. This factor
coupled with the gradually di¬
minishing supply would boost the
sperrmark price to perhaps 80%-

expectations of

ahead.

improve

would be for the German Govern¬

ef¬

exact

.

the prospect of a deficit as high as
the $15 billion that Mr. George

anticipated

step—a step whicii

equalizing the two

greatly facilitate the handling and

Control

&

Most trades by foreign investors
in
German securities
are
made

that giant total

even

in

types of sperrmark,

today than when it A Plan to Reduce Blocked Marks
renewed operations a few years
With these end results in mind
ago.
Daily
German newspaper a possible method of
reducing
reports indicate that foreign in¬

$95"and $100 billion

7% lower than in 1953.

borrowings

.

total national accounts should

fall
in

.

to

that total bank loans may decline

"decrease

(drawn) more fre¬
(with) 1948-1949 than

.

transfer payments
impact of Government upon

our

Roy L# Re,erson

•equipment to be slightly less than
in
1953, say by 5%.
(3) Some
liquidation of business inventories
to

The historic

Including
the

Business
plant

.

between

■expenditures
on

of

were

.

result

acquired.

active

solve.

Government spending for goods
and services next year will fall

12%.

to

Gainsbrugh

cycle.

on

than
in
1953,
perhaps by

<2)

R.

M.

will

rep¬

Attract the desired for¬

The stock market itself is much

private

eco¬

1954

to

economic aim—that of

government financial experts and

varying dimensions.

ises: (1) Hous¬

ing

of

in

upon

following

major

lower

a

(a)

Deutsche

more

in

nomic activity

1954

based

orv

no

recovery.

Now the G. F. R. should be
ready
to take another

the

or

losses.

balance\e^-J

expec¬

long-term

played

Company Dec. 31.

tainable,
«

This

action

Germany's

funds,

eco¬

there are active foreign orders in
.leading German issues—particu¬
larly I. G. Farben, heavy indus¬
try and electrical industry shares.

of,

such

investments

partnership

still very limited—a problem that

This

true that,

which could have

Nevertheless, foreign participation

from

is

credit

fect:

p.5£t inflations, while holders

slightly
higher.
The

moderate decline in interest

re¬

these

eign capital; (b) increase domestic
savings deposits and
loanable

tivity in 1954, the prospects indi¬
rates

It

tend

tion's

wartime

cate

•current levels.

switching of bank de¬
a
foreign exchange

of the marks from the

any

would

capital debt holders who suf¬

activity,

a

them,

and

small role in

actual
obligations of the
German Federal Republic
any re¬
duction of outstanding - balances

ascer¬

economic

transferrable.

advocated

ago.
Certainly that move
opened up large amounts of sperr f
mark to long-term investments—

resent

man

curity

of

for

Since these blocked marks

r

securities

levef

shares

investment through sperrmark
transactions
occurs.
While
this

tively ^short ^period of ten-fifteen
years.
These' issues yield more

terests

gathering

same

made

a -freer
exchange of goods be¬
nation's.
The
easing 'oil
activity tends to reduce sperrmark tween
travel restrictions advocated in thi*
balances outstanding, it is
largely
new issues are
article will mean a freer exchange*
daily entering the
sporadic in nature and supplies
market and are being;sold with¬
of ideas.
Both factors bring the
neither the necessary
steady mark
out difficulty.
But most bear in¬
.consumption nor adds stablity to Western World's plan for a United
terest rates of
approximately 8% sperrmark prices.
Europe a bit closer to realization.

on

prospect,

his

transactions, will not

market.

1953—denoting a vast increase of
confidence of the German people
in the Deutsche Mark
currency-

fect of foreign transactions

the

not

in

as

move

billion

do

For when the

sells

sperrmark

mere

trader's

December,
in July,

,

a

posits,

shares,

actions

investor

receives

and

institu¬

these

sperrmark

ac¬

foresaw

Downturn,

'

aggregate

credit

the problem.

he

Now, with savings de¬
German

German

but

foreign

the

tivity in 1954,
only two of

t

REIERSON

Forecasts

back

of

solve

past

this

-

MR.

14

the

level

economic

be

all

determine
on

total

about 2% or 3%.
r'

default held

nomic fluctuations with few
in

were

could

views

foods,
house-furnishings.

and

over-all

and

purchase

etc.,

increasing from 4.18 billion

Deutsche

freely

reality.

ter and often survived these

I

a

tions

in

a

In closing, it should be
noted
that the first step towards
making
the mark negotiable was

o^ equity issues fared much bet¬

GAINSBRUGII

In Summary

con¬

offset

posits

and

service

be

status

Germany to another, used for

the

.

pants who gave their
views for sector accounts.

should

of

I

cerned, I see a year of relatively
small change with a
very moder¬
ate drop. Rising rents and
rising
costs

are

the

as

is

move,

leader for the year.

a

over-all

of
.

will

drop in wholesale prices but a
•djfrpp which will be moderate in

upward

an

equipment com¬
panies.
This
industry holds
the promise of great profits and
could quite well be the market

en¬

think

through 1954 will

financial

history

dis¬

more

of securities.

I

what

•rhave'^an
; V

certain

available.

going

;

in

se¬

relatively1! small amount of funds

V(rethink)
are

some

in

not

;% In 1954

.

float

bearing
high
interest
rates and having tax
advantages
to investors, but the nation's un¬

in¬

...

A think both are

o me

base,
need

a

able to

were

curities

crimination in

will

going

a

for

posable
decline.

on

dis¬

the

come

be

broader

or

tions

promises

to

will not

come

belt, Bonn's drearmof

convertible Deutsche Mark would:
be one large step closer to

years

Remarkable Recovery

Buy¬

vances.

in¬

decline

;

Germany's

will make ad¬

that

personal

s

West

issues

many

disagree with those who

With these achievements under
her

writer

-

index probably
neighborhood of

the

eign investors would be attained.

were

Upturns in 1954 will prob¬

.

ably not be as emphatic for the
entire (security) list as were some
of the past markets, but a great

Prices

The decline in the Federal

...

.

required by for¬

in

from

.MR. BACKMAN
Sees

stability o? *

necessary
rates

take.#
March, 1951. At that time pre¬
viously frozen sperrmark balances

SLADE

upon

earnings.

of any past period of
high
activity barring 1953.
A

level

The

sperrmark

record

the

are

(4)

appear

contraction.

support

a

activity and the market potential
extremely high; appraised
not against 1953 but
against the

of

will
MISS

definite effect

very

average

will

of

reveals

tem

the

•earnings will decrease. It is clearly
•evident, from current statistical
that

sectors

a

strength still

pected

weekly

average

sales

did

in

(the)

low point, followed
by some sideI think that em¬

and

The

which

huge volume of security financing

wise movement.

ployment

companies

25

solving
the troublesome sperrmark prob¬

be

for

a

<=47

would

remote

would

just

not

possibility.

be

no

reason

^

THAN EVER BEFORE

^7

in

this plan

four

would

important

re¬

German

obligations

foreign

would

be

£

Join ihe

accom¬

plishments:

exchange

reduced

outlet for these marks.

constant
and
steady source
of
sperrmark purchasers.
(3) These marks would com¬

MARCH
OF

without endangering the currency.

Outstand¬

ing balances remain substantially
unchanged.
Sperrmark may be
traded by foreign exchange trad¬
ers, transferred from one account

(2)

mand

^

"4-

-

ing in almost all financial centers,
there is actually little final

but

0

7^

fi

Therefore,

(1)

*

rate.

it.

sult

.

trad;

even

There

lem.
There is heavy sperrmark

Mark

TO FIGHT POLIO

<7

stay there. At such

level, capital flight

a

One step

be

Deutsche

the

would

| Money
^

There

a

possible

rate

would

that

reason

at

last

precludes

be

a

any

for capital flight.

DIMES
January 2 to 31

< *

The Commercial and Financial Chronicle..

(2654)

30

Continued, jrom page

than

5

a

year ago

163 in 1951.

Failures

Industry

those with

Scheduled To Rise Despite
Shortened Holiday-Week

the

In

steel

somewhat

better

is

1953

late

their

metal

that

consumers

expected

are

to

in

dence

supply

increased

believe they could get

steel

of

made

31

complete

Wholesale

get

a

along with smaller stocks, it asserts.
steel and price concessions

on

Korean peace conference under way by late January flares
again or if some other incident arouses buyers, "Steel"

Dec. 22.

282.14

fident

and

a-ton

price

reduction

inventory

that

no

Agents"

duced

says

Exports of wheat and
vember
with

this

buyers in some cases are canceling orders that are already in rail¬
road cars for delivery.
In other instances, consumers want de¬

Offerings

livery in three to four weeks, or from stocK, or anead

ui

the

watching the first quarter shape up, steel companies
will be keeping a collective eye on sales of new models of auto¬
mobiles. The automobile industry is the biggest single consumer
While

bales,

with

the

Chicago

oats

market

United

the

to

on

reports

States.

of

somewhat firmer.

billion
machinery
and
other
equipment, $12 billion construc¬
,

tion and $7 billion servicing. This
amounted to 18.5% of the nation's
industrial

output.
Capital goods
employment in 1952 totaled 8.1

stim¬

was

lion

possibility

the

was

,^viv
ten

208,100

of

some

expansion

although currently export shipments

on,

million persons.

record.

on

loan

of

entries

previous week,

continued

to

below

be

expectations

trade

While capital goods industries
manufacturing productive equip¬
ment

Preliminary

estimates pointed

unprecedented

that shoppers

proportion.

In

were

more

to

Christmas

a

in

most

selling

was

mated by Dun &

E.

demand than
previous week, the interest in major appliances and furni¬
ture remained lethargic.
Widely popular were small appliances,
clock-radios, giftware and china.
More toys and novelties were

in

1951.

Loadings Dip 5.1% Under Previous Week

Loadings

U. S. Auto
-

week

of

revenue

freight

for

the

ended

week

Dec.

The

some

plants took off

more

days last week than

is usual.

household

ever

Trading
ended

on

goods

in

were

at

an

in

Wednesday

wholesale

most

continued

close

Mr.
in

the

Ply¬

Federal

Reserve

decreased

1953,

l'%

on

Board's

below

a

in

the

increased

country-wide basis

Jan.

1

crease

the agency

reported, there were 17,650 trucks made in this coun¬
try, from the 25,825 in the previous week and the 18,453 in the like

as

1953,

to

a

Dec.

of 1%

5,531 cars and 978 trucks,
"Ward's" said. The week before it was 7,205 cars and 1,647 trucks,
and in the same week last year it was 3,607 cars and 1,261 trucks.

mas

Leavitt Opens Office
LAS

failures fell

to

162

in

the

week

24, from 210 in the preceding week, Dun & Bradstreet,

Inc., reports.

However, casualties continued considerably higher

reported. For the period of
19, 1953, department store sales registered an in¬

The New York Stock
has




was

*

Exchange

the

Bendix & Co. is
cember

following

—-

dissolving De¬

31.

..

Shethar &

.

Company is-dissolve

ing Dec. 31.
N.

C.

limited

re¬

ported from that of the similar week of 1952, while for the four
weeks ended Dec. 19, 1953, a decrease of 4% was reported. For
the period Jan. 1 to Dec. 19r 1953, a decrease-of 1% was
registered

period.

announced

changes:
by good

one additional shopping day and the final rush of Christ¬
buying, lifted sales about 20% above the like 1952 period.

from that of the 1952

Fre¬

Exchange
Weekly Firm Changes

store sales in New York City for the weekly period ended Dec.
19,
1953, registered a decrease of 3% from the like period of last year.
In the preceding week Dec.
12,

,

425

at

N. Y. Stock

above the corresponding period of 1952.

decrease of 7%

offices

securities

a

mont.

was

a

El win C.

—

conducting

business from

index, for the week ended Dec. 19,
level of the preceding week.
In

1953,

VEGAS, Nev.

Leavitt is

?

Above Year Ago

King Opens

of

According to the Federal Reserve Board's index department

Business Failures IDeclined Last Week But

partner

period

level

weather,

Last week Canadian output totaled

partner.
a

Bruce King is engaging in a se¬

the

decrease of 3%

limited

formerly

was

curities business from offices at 33
West 60th Street, New York City.

taken from

Retail trade volume in New York last week, spurred

1952 week.

industrial

Bliss

o

the previous week, Dec. 12, 1953, a decrease of 3% was reported
from that of the similar week j6^1952T. For the four weeks ended

Dec. 19,

New

Gilchrist, Bliss & Co.

The total dollar volume of wholesale orders did

Department store sales
the

the

partner, and William W.

Bruce

markedly from the high level of a year earlier.
Buyers
were busy with preparations for
January promotions, Spring sell¬
ing plans and last-minute reorders of gift merchandise.

But

of

all-time high.

not vary

97,416 (revised) in the previous week.
A year ago the weekly
production was 79,237.
In the truck area of the industry, production has been geared
down more sharply in the final months of the year.
Last week,

Commercial and

Bliss,

larger

markets

to

'

Exchange, are Frank
the Exchange member,

Goldsborough,

before.

activity

the prior week.

mouth, Dodge, Chrysler, Packard and Hudson worked only three
days, while DeSoto operated only two days.
The industry turned out 68,795 cars last week, compared with

ended Dec.

for holiday specialties was

most

bought than

for the latest week dropped about 29%
below the previous week and 13% behind the like 1952 week, ac¬
cording to "Ward's Automotive Reports."

holiday.

demand

While

output

Last week's total tumbled due to the Christmas

year ago.

in the

Output Declines Due To Christmas Holiday

Automobile

a

equipment.

member

a

general

1953, decreased 33,519 cars, or 5.1% below the preceding week,
according to the Association of American Railroads.
;
- Loadings totaled 618,432
cars, a decrease of 91,958 cars, or
12.9% below the corresponding 1952 week, and a decrease of 52,930 cars or 7.9% below the corresponding 1951 week.

Car

like

more

Stock

the level of

19,

the

over

be

York

esti¬

Bradstreet, Inc., to be from 0 to 4% higher than
Regionab^siimates varied from the com¬
parable 1952 levels by the following percentages: New England
—1 to -f 3; East —2 to +2; Midwest 0 to
-4-4; South and North¬
west -(-1 to 4-5; Southwest 4-2 to
4-6 and Pacific Coast 4-3 to 4-7.

kwh.

single major group

no

be
formed, with
offices
at
39
Broadway, New York City. The
partners jn the new firm, which

noted

will

the week

trade in

industry

Bliss & Co. Forming

bargain-conscious than at this time last

dollar volume of retail

one

•Effective Jan. 7 Bliss & Co. will

a

The total

no

of

the

purchases

year.

decline of 746,250,000 kwh.
below that of the preceding week, but an increase of 600,270,000
kwh., or 8.0%, over the comparable 1952 week and 1,228,375,000
figure represents

fact,

of productive

season

sections

industries,

of commodities accounts for
than 15% of the total

As during recent years,

Retailers

group

dominates.

the bulk of the gift buying came in the last week before Christmas.

of

workers

more

similar

study shows that

Ago

year ago.

a

far

other

any

manufacturing

Mildly Above Final Christmas Week

mildly higher than

emplov

than

Christmas

was

con¬

non-agricultural production, is di¬
rectly engaged in some form) of
capital goods activity.

and

shopping continued to gather momentum, the
total dollar volume of retail trade rose
noticeably in most parts of
the nation in the period ended on
Wednesday of last Week.
Al¬
though the number of retailers who were unable to surpass the
sales figures of. a year earlier was quite
large, the aiotal retail

distributed by the electric light

equipment, 1.9 million in

,
ing. Thus, about one out of every
last week' to- 162,200**. five^of the 42 million workers em¬
ployed in this country in private,
and 257,600 two weeks

period at 684,990 bales, or an average of 35,128 bales
This compared with 35,200 bales per day during the
period and 38,700 in November a year ago.

A Year
As

Of these, 4.8 mil¬

engaged in manufacture

struction and 1.4 million in servic¬

<,

bales

Trade Volume

were

spot markets declined

the

The percentage fig¬
the capacity as of Jan.

industries

For the year 1952 capital
goods
activity totaled $54 billion —■ $35

a

Average

Demand

these

create.

into

bales during the week ended Dec. 11, as compared
in the preceding week.
The Bureau of the
reported consumption of cotton during the four-week

October

preceding week.
current

were

support

the

403,300

day.

per

power

The

employment

said to be going

was

November

industry for the week ended Saturday, Dec. 26, 1953,
was estimated at 8,150,000,000 kwh., according to the Edison Elec¬
tric Institute.
The foregoing is a preliminary figure and repre¬
sents sharp decrease from the all-time high record established in
the

from

Census

Declines Sharply From All-Time

The amount of electric energy

in

corn

totaled 376,400

High of Previous Week
and

in

CCC

the

1, 1953, the rate this year being higher than last year.

Electric Output

year.

extent by the approval of growers of 1954 market¬

107.2% of capacity.

for the current year are based upon

ures

highlights the vast productive ac¬
tivity of the nation's capital goods
and allied industries and the
large

ago.

a

was

period last

same

demand later

Sales

week ago.
For the like week a month
ago the rate was 87.5% and
production 1,972,000.
A year ago
the actual weekly production was placed at 2,226,000 tons and
operating rate

95,000,000

Argentine

lending

in export

capacity for the week beginning Dec. 28, 1953, equivalent to 1,674000 tons of ingots and steel for castings as against 64.1% and 1,-

the

wheat for

at

continue to lag.

operating rate of steel companies having 96.2% of the steelmaking

(revised)

of

some

Also

capacity for the entire industry will be at an average of 74.3% of

444,000 tons

as

ing quotas by the largest vote

during the week ended Dec. 26 is 70% of, capacity. This is a
13;5-point decline from the preceding week, and the lowest
weekly rate this year. A year ago the mills operated at 105.5%.
that

flour

declined

sales

ulated to

months, this trade weekly notes.
prompted steel pro¬
ducers to reduce production during the Christmas holiday week
for the first time in several years. "Steel's" preliminary estimate
of the national rate of output of ingots and
steel for castings

announced

July through No¬
bushels, compared

and

ago.

general demand lor steel

Steel Institute

the keystone role of capital goods
in
the
American
economy
and

grain

fairly brisk demand with prices mostly steady.

Spot cotton prices

and sold in the next few

and

This study strikingly documents

con¬

that

reported

were

limited and much

were

Oats

in

year

Consequently, the public's acceptance of the new models
will determine to a large degree how much steel will be made
of steel.

Iron

in

daily purchases of all grain and soybean futures on the Chicago
Board of Trade last week totaled about 3-3,100,000 bushels, against
57,500,000 the previous week, and 49,700,000 in the like week a

schedules.

American

in

was

loan.

spurt

smelt

year

125,000,000 for the

Corn

The

lion.

falling off in demand in¬

business

export

struc¬

includes
production, transporta¬
tion, distribution and servicing of
capital plant and equipment#:-Em¬
ployment created by these activi¬
ties is expected to reach 8.2 mil¬

1952.

a

the size and

on

industry, the nation's capital goods
productive activity in 1953 is ex¬
pected to total $58 billion.
This

with

compared with 273.39 a week earlier and

disappointing

by

close to the vest, steel

lowered

vancement

Pre-Holiday Dullness Sets In

corresponding date in

study

a

ture of the American capital gootLs

tinued slow domestic flour trade.

long-range approach to assurance of
long-range policy, rather than one of ex¬
A

advantage.

supply demands a
pediency, the association suggests.
In reducing inventories and buying

The

wholesale level.

Early weakness in wheat reflected

this is no time to be overcon¬
time to toss and old supplier over for a 50-cent-

Purchasing

of

This

projection of

on

published bulletin of the
Council
for
Technological
Ad¬

volume

means being more
vulnerable in event of sudden shortages, the "National Associa¬
tion

Based

newly

Pre-holiday dullness characterized most grain markets and
of trading slackened with price movements irregular.

'

out

coming within this cate¬
produce 18.5% of nation's
industrial output and employ over
eight million persons.
;

a

the

on

Ad¬

gory

rise of 9.3%,
of the price per pound of
function is to show the

a

Technological

concerns

.

price index continued its downward movement to stand at 271.94

war

Pointing

r

further softening in some of the major commodi¬
the Dun & Bradstreet daily wholesale commodity

Reflecting
ties last week,

reasons

declares

ago, or

year

a

for

capital goods industries, estimates

Straight Week

Commodity Price Index Edges Mildly

Lower As

for reducing steel inventories, lowered in¬
ventories could bring about a scramble for steel if a failure to
adequate

three more than in the prior week.

.general trend of food prices at the

While the increased availability of
are

the like date

on

,

vancement, in study of the size
and structure of the American

in

consumers

many

Council

com¬

Twenty businesses failed with liabili¬

year ago.

The index represents the sum total
foods in general use and its chief

liquidation soon. When they started to reduce
of^raw materials they curtailed new buying. Confi¬

an

last year.

Capital Goods

Pit at $58 Billion

decreased to 139
Small casualties,

more

or

Dec. 22, from $6.66 a week previous, to mark the high¬
over three months.
The latest figure compares with

on

level

inventory

inventories

into

$6.72

$6.15

expected to
steel de-t
the level

to

$5,000

Continuing its upward movement for the seventh straight
week, the Dun & Bradstreet wholesale food price index advanced

be slightly lower in 1954 than in 1953, but the reason
mand is expected to rise in the next three months over
of

of

Seventh

est

Continuing, it points out, business as a whole is

1953

Wholesale Food Price Index Continues Gains For

will be the best

banner month in steel production,

a

a

ties in excess of $100,000,

industry the coming year, January will be a
month than December, when holidays and in¬

in the first quarter, it reports.

one

liabilities

liabilities under $5,000 dipped to 23 from 31 and

pared with 12

ventory reductions at metal consuming plants took the edge olf
new buying, states "Steel," the weekly magazine of metalworking.
In February, demand will be stronger than in January and March,
historically

with

179 in the previous week and 83

from

Steel Output

were about even with the
noticeably from the comparable

down

were

level of 190.

pre-war

The State of Trade and

when 95 occurred, and

Failures

.Thursday, December 31, 1953

.

Weeks

&

Vanderlip retires from
partnership
in
Baker,
Co.

Dec.

31.

*

Quitman R. Ledyard withdraws
from

partnership in 4T. C. JBrad-

ford &

Co.

Dec. 31.

:

Volume 178

Number 5286,.. The Commercial and Financial Chronicle

(2655)

The

Indications of Current
Business

following statistical tabulations

latest week

Activity

week

or

or

month available.

month ended

Lateat
AMERICAN*

IRON

Indicated

steel

AND

STEEL

operations

Jan.

3

Month

Week

Ago

AMERICAN
Crude

PETROLEUM

oil

and

(net tons)

:an.

=64.1

87.5

output—daily

fuel

(bbl:.

average

Residual fuel oil

output

(bbls.)

3ec"

fuel

Residual

fuel

ASSOCIATION

at

(bbls.)

116,918,000

6,915,000

7,066,000

24,084,000

24,502,000
2,708,000

24,710,000
2,312,000

23,497,000

2,521,000

i9

10,220,000

10,377,000

10,622,000

10,583,000

19

8,281,000

8,100,000

8,253,000

Benzol

6,928,000

19
19

9,134,000

freight loaded

Revenue

freight received

ENGINEERING

from

of

153,586.000

152,509,000

145,193,000

19

32,389,000

33,865,000

36,028,000

28,652,000

ig

123,444,000

126,710,000

Dec!

133,439,000

105,884,000

Month

19

49,975,000

50,455,000

50,494,000

48,504,000

618,432

651,951

725,732

710,390

cars) —Dec. 19

586,824

609,123

633,812

659,257

CONSTRUCTION

of

U.

S.

Private

Public

$226,520,000

.-Dec. 24

—

64,191,000

OUTPUT

(U.

S.

BUREAU

OF

Beehive

coke

STORE

ELECTRIC

Electric

SALES

steel

(per

Pig iron

(per

gross

Scrap steel
METAL

(E.

Export

40,771,000

Gas

MOODY'S
U.

S.

St.

INDUSTRIAL)

—

DUN

717,000

75,100

98,400

131

237

8,150,000

8,896,250

8,138,165

162

210

173

109.6

106.6

111.3

117.4

116.7

115.1
115.2

118.7

118.4

126.8

126.0

118.8

106.9

105.0

125.7

124.6

121.1

~HH_II

108.1

operation

__

_

III—IIIII"II

108.1

107.9

116.6

116.0

112.8

105.5

105.3

105.6

130.7

130.7

128.4

122.8

122.6

118.9

113.2

112.9

112.3

108.6

Other goods

107.8

107.6

119.7

118.5

115.8

14,323,045

13,420,073

12,804,430

.CIIII
I__IIIII

care

Personal

care

COTTON
As

1

and services

GINNING (DEPT.
Dec. 1__.

of

4.634c

4.634c

4.632c

4.376c

$56.59

$56.59

$55.26

$30.00

$30.67

$34.83

$42.00

FABRICATED
CAN

OF

STRUCTURAL

INSTITUTE

TION)—Month
Contracts

29.675c

29.700c

29.425c

28.975c

29.650c

COMMERCE)—

28.825c

34.900c

84.250c

86.000c

85.250c

13.500c

13.500c

14.250c

13.300c

13.300c

13.300c

14.050c

Dec. 23

10.000c

10.000c

10.000c

96.10

94.83

106.04

106.21

•106.04

Weekly

96.00

All

Group—

Group

62.56

39.9

40.3

41.1

40.6

41.0

41.9

39.0

39.2

40.1

$1.78

$1.78

$1.71

1.89

1.89

1.63

1.62

goods

109.60

111.88

110.70

113.31

107.98

112.19

Durable

Nondurable

Dec. 29
-Dec. 29
Dec. 29

Group

76.26

63.50

OF

goods

107.98

All

manufacturing

t

goods

105.86

105.69

108.88

100.32

100.16

104.14

Hourly

103.80

103.80

103.80

106.92

All

106.56

106.56

106.21

109.42

Durable

107.98

107.98

108.16

112.37

Nondurable

,

$70.28

77.49

63.57

DEPT.

Hours—

110.88

105.86

$71.73

76.73

S.

manufacturing

Nondurable

108.16

100.00

184,331

262,730

earnings-

Dec. 29
Dec. 29

217,600
255,599

$71.02

ESTIMATE —U.

Dec. 29

—Dec. 29

191,180

289,755

,

EARNINGS AND HOURS—WEEKLY

Durable

—

CONSTRUC¬

October:

(tonnage)—estimated

LABOR—Month of November:

AVERAGES:

DAILY

STEEL

(AMERI¬

(tonnage)—estimated

AVERAGE

12.500c

96.83

Dec. 29

—

FACTORY

121.500c

13.500c

Dec. 29

at

OF

of

closed

STEEL

24.200c

Dec. 23

—

:

,

goods

earnings—

manufacturing

;

goods

goods —

MOODY'S BOND YIELD DAILY AVERAGES:
Dec. 29

2.73

2.77

2.86

2.78

3.39

FREIGHT

3.39

Dec. 29

3.12

Aa

Dec. 29

3.27

3.28

3.28

3.05

A

Dec. 29

3.40

3.40

3.41

3.23

Dec. 29

3.75

3.73

3.74

3.50

Dec. 29
Dec. 29
Dec. 29

3.52

3.52

3.36

3.36

3.38

3.20

3.28

3.28

3.27

3.04

—s-Dec. 29

413.4

411.3

corporate———

—III

Baa

Railroad

Group

Utilities

Public

Industrials

Group—

Group
INDEX

COMMODITY

MOODY'S

Orders received

Production

=

of

2.99

3.52

of

Domestic

212,109

193,817

178,124

241,648

246,855

252,244

242,594

94

95

402,833

421,729

441,859

106.92

107.48

106.41

108.77

dealers (customers'

HOUSEHOLD

28,876

565,869

867,325

$33,504,920

$25,189,730

$37,618,852

sales

1

Customers'

short

Customers'

-—.Dec. 12

26,697

28,300

19,533

Dec. 12

137

164

168

Dern 12

value

26,560

28,136

19,365

781,875

813,387

556,192

5,249

5,729

Policy

920,904

4,982

3,194

Dec. 12

776,893

808,138

550,463

917,710

—Dec. 12

—

$30,113,115

$30,706,080

$21,455,008

$36,125,595

268,370

287,390

184,710

327,780

shares—Total

Number of

Short sales

sales

Other

sales
—————

—-—

_-c

——

—Dec. 12
—-—Dec. 12
-—--———-Dec. 12

\

287,390

184^710

of

37,155,000
8,683,000
33,477,000

31,605,000

54,548,000

October:

1

values

purchases by dealers—

ITEMS

OF

U.

S.

CLASS

81,787,000

$383,180,000

$339,557,000

I

uVV

September:
operating

income

$99,941,786

$101,635,603

$121,311,183

21,017,639

20,806,097

120,959,425

122,441,700

19,310,052
140,621,235

3,892,944

3,997,753

4,192,790

117,066,481

income

Total

Dec. 12

Number of shares

TOTAL

AND

ACCOUNT

FOR

241,010

190,780

MEMBERS

OF

Income

Income

(SHARES):

Other

Total Round-lot sales—

268.230

255,460

238,270

Dec.

8,551.500

6,140,050

6,224,480

9,001,240

Federal

8,886,130

6,408,280

6,479,940

9,239,510

Dividend

FOR ACCOUNT OF MEMBERS. EXCEPT ODD-LOT DEALERS AND SPECIALISTS:

Total

896,470

632,900

668,950

118,443,947

83,360,616

84,829,929

136,428,445
102,081,537

116,330

122,680

161,530

759,360

464,670

517,230

907,310

581,000

639,910

866,430

-|
—

Dec.

281,040

178,990

238,020

231,840

Dec.

15.700

7,000

10,800

—-—•$-

—

—

sales

Other

Total

transactions for account of members—

purchases

—r-

.

Short sales

;

sales

Other

*

Total sales

PRICES,

WHOLESALE
LABOR

—

Commodity
All

(1947-49

NEW
=

SERIES

—

U.

S.

of

133,910

192,350

252,250

338,750

237,200

262,330

364,330

1,

figure.

1953

62,300

31,270

32,710

22,400




73,958,476

29,281,127
4,802,527

19,817,615
2,909,587

3.47

3.52

3.97

$16,970,000

$11,696,750

813,600

IN

$1,244,000
923,000

$1,215,000
918,100

$275,000,000

$275,000,000

$275,000,000

273,386,221

267,432,234

65,938

50,592

DI¬

SECURITIES

November:

of

$1,052,000

DEPT.

.-

202,783

224,200

392,455

414,855

BUREAU

Dec.
'

381,495

234,053

256,910

1,516,260

1,049,090

1,169,300

Dec.
Dec.
Dec.

225,950

154,600

166,190

193,330

1,340,525

794,363

922,980

1,340,205

1,566,475

948,963

U.

S.

1,089,170

1,531,450

1,533,535

OF

at

$1,244,000
-

-

of

face

STATUTORY DEBT LIMITATION
Nov.

(000's

30

amount

that

omitetd):

may

be outstanding

time

any

-

Outstanding—
Total

public

gross

Guaranteed

debt

obligations

not

110.1

110.0

109.5

95.4

=94.7

95.0

101.0

104.9

103.8

102.8

87.0

88.2

84.8

114.4

114.4

114.6

112.7

guaranteed

1

92.5

Dec. 22

the

owned by

—I

Total gross public debt and

104.4

Oct.

of

—

Treasury

110.1

--

IMPORTS

omitted):

GOVT.

—As

Total

AND

CENSUS —Month

OF

—

-

EXPORTS

Imports

319,195

("Includes 564,000 barrels of foreign crude runs. SBased
against the Jan. 1, 1952 basis of 108,587,670 tons.

as

56,624,106

17,410,173
2,983,279

275,208,583

GUARANTEED

Exports

Dec. 22

commodities other than farm and foods

Jan.

277,670

Dec.
Dec.

Dec. 22

"Revised
as

242,850

Dec. 22

Meats
All

181,550

Dec. 22

foods

56,400,565

/

charges

TRANSACTIONS

A.—Month

STATES

126,910

100):

products

Processed

2,986,962

99,094,575

41,154,863

73,796

fixed

purchases

261,970

Group—

commodities

Farm

Net

Dec.
Dec.

Dec.

Total sales
Total round-lot

AND

S.

U.

(000's
—

Short sales

,

to

sales

UNITED

initiated off the floor—

purchases

3,303,505
81,526,424

42,255,336

9,400

*££

—

-/
f

stock

MARKET

OF

Dec.

sales

stock

income

of

RECT

Net

—

—

transactions

Total

the floor—

purchases

preferred

TREASURY

704,900

—Dec#

Total sales

Other

2,867,238

42,493,759

935,280

147,950

r-l—Dec.

—

—

Other transactions initiated on

Other

-

appropriations:

On

-Dec.

—'=v~
:

sales

Short sales

charges

80,493,378

common

Ratio

-~~f—Dec.

purchases

Total sales

Total

fixed

charges

(way & structure & equipment)
income taxes

On

specialists in stocks in which registered

Short sales
Other

for

fixed

income

Depreciation

TRANSACTIONS
of

avaliable

from

deductions

334,630

.iii--- Dec.

Total sales

Transactions

—

deductions

after

Dec.

•—

.

sales

Other

..

Net income

Short sales

ROUND-LOT

income

Miscellaneous

281,220

STOCK SALES ON THE NEW YORK
ROUND-LOT STOCK TRANSACTIONS

ROUND-LOT

EXCHANGE

223,610

9,220,000

$359,570,000

■

Round-lot

39,111,000

52,916,000
51,845,000

(Interstate Commerce Commission)—
of

$154,860,000
" *

60,515,000

INCOME

railway

Other

321,180

$167,530,000

LIFE

OF

■

Month

Net

268,370

INSTITUTE

TO

dividends

RYS.

sales by dealers-

Round-lot

—

PAYMENTS

Total

SELECTED

292,474

33,732,000
60,153,000

BENEFIT

payments

227,253

MANU¬

units)

payments

Surrender

32,330

Dec. 12
—Dec, 12

—

sales

other

Customers'
Dollar

Annuity

105

—

249,383

8,678,000

of

October:

endowments

Disability

30,900

STAND¬

—

of

benefits

Matured

32,435

other sales—:

Number of shares—Total sales-—
Customers' short sales.

.

Death

10,300

30,400

40,792,000

(number

—

59,100

10,300

26,200

CLEANER

ASSN.)—Month

INSURANCE

185,300

239|700

60,500

(units)

CLEANERS

(VACUUM

sales

177,500
201,400

57,600
10,400

$155,700,000

VACUUM

SIZE

196,500

(units)—.

burners

INSURANCE—Month

19,197

766,716

$32,173,637
A.

dealers (customers' sales)—
orders—Customers' total sales—

Number of

25,663

720,666

—Dec. 12

Odd-lot purchases by

:

,

24,184

87,657

215,800

(units)

(units)

boilers

FACTURERS'

LIFE

Dec. 12

5,929

35,171

ASSOClj

shipments (units)

shipments

range

Gas-operated

Factory

—Dec. 12
—————

8,72-fe

(number

October:

furnaces

POLICYHOLDERS

—

Dollar value

gas

Gas-conversion

purchases) —

orders

of

of

96

371,487

ACCOUNT OF ODDLOT DEALERS
AND SPECIALISTS ON N. Y. STOCK
EXCHANGE — SECURITIES EXCHANGE COMMISSION:

Number

month

MANUFACTURERS

gas water heater

Gas-fired

ARD

Number of shares

6,137

of

31,869

ATION—Month

STOCK TRANSACTIONS FOR ODD-LOT

Odd-lot sales by

cars)

orders at end

Automatic

407.8

Dec. 2o

—

(number of

of

cars)__

APPLIANCE

GAS

PRICE INDEX—

100

November:

Deliveries

Backlog

3.34

402.7

—

of period

at end

(tons)

AVERAGE

3.13

Dec. 19

—

OIL, PAINT-AND DRUG REPORTER
1949

*

212,033

Dec. 19
—Dec. 19

—

activity

of

orders

3.12

93

(tons)

(tons)

Percentage
Unfilled

3.38
„

ASSOCIATION:

PAPERBOARD

NATIONAL

1.56

CAR

OUTPUT—DOMESTIC (AMER¬
ICAN RAILWAY CAR INSTITUTE)—Month

3.19

Dec. 29

Aaa

Average

1.82

1

Government Bonds

S.

113.2

107.0

I

Transportation

95

$56.59

Dec. 23

A

U.

115.0

110.1

electricity-.

Household

7,549,730

Dec. 22

-

Utilities

115.0
.

107.7

vegetables

Apparel

QUOTATIONS):

Baa

Public

216

Dec. 22

—

Railroad

and

and

Medical
=

234

Dec. 23

-

114.2

.

&

at

PRICES

113.5

Housefurnishings

10,336,000

588,000

=59,500

—Dec. 26

Aa

Industrials

and bakery products
poultry and fish
products

Shipments

at

115.2
113.8

Reading and recreation

corporate—

Aaa

8,955,000

514,000

60,800

Dec. 19

Government Bonds

Average

8,390,000

516,000

—Dec. 23

Louis)

BOND

;

Housing

RESERVE

at

(East

8,040,000

Dec. 19

at—

Zinc

=

Dec. 19

Dec. 22

York)

Louis)

115.4
113.6

113,3

;

Rent

Dec. 23

(New

(St.

67,137,000

26,366,000

:

refinery

tin

Lead

87,365,000

8,516,000

100

=

AND

J.

17,408,000

home.^—

PRICES:

(New York)

Straits

92,246,000
44,334,000

Electrolytic copper—
Domestic refinery at

Lead

107,899,000

52,850,000

ton)

M.

223,435,000

24,709,000

—

116.9

6,685,000

;

lb.)

&

100

Other foods at home_„

67,071,000

gross ton).

(per

PRICES

=

117.5

73,756,000

Dec. 24

COMPOSITE

Finished

INDEX—1947-49

113.5

37,016,000

BRADSTREET, INC
IRON AGE

229,334,000

111.1

162,329,000

kwh.)

(COMMERCIAL

237,196,000
10,174,000

export

(barrels)

Solid fuels and fuel oil

INDEX—FEDERAL

AVERAGE

000

8,608,000

October:

at

Fruits

$154,502,000

INSTITUTE:

(in

output

FAILURES

$145,096,000

Dec. 19

SYSTEM—1947-49

37,000

18,459,000

8,480,000

120.3

125.313,000

(tons)

DEPARTMENT

EDISON

$181,655,000

MINES):

Bituminous coal and lignite (tons)
Pennsylvania anthracite (tons)

55,000

20,847,000

120.4

Dec. 24

municipal

Federal
COAL

38,000

20,757,000

Cereals

Dec. 24

and

of

Food

—__Dec. 24

construction

State

PRICE

Dairy
—

213,776,000
195,528,000
18,211,000

20,602,000

Meats,

—Dec. 24

construction

construction

and

•

CONSUMER

.ENGINEERING

—

204,059,000

9,642,000

(barrels)

domestic

Food

cars)
(no.

™

224,716,000

196,717,000
20,216,000

All items

Dec. 19

Ago

216,971,000

III

(barrels)

imports

stocks

Year

Month

131,017,000

-

connections

J

)_I_III

(barrels

(barrels)

(barrels)
all

Previous

gal¬

(barrels)

consumption

Increase
19

RAILROADS:

(number

output

output

imports

products

Indicated

NEWS-RECORD:
Total

oil

}ec

•„

—

oil

gasoline

output

Crude
Refined

2,942,000

crude

Natural

.

6,610,800

dcc

at

AMERICAN

Revenue

CIVIL

6,259,150

of that date:

are as

INSTITUTE—Month

Total domestic production
(barrels of 42
lons
each)———

d6C|

(bbls.)

oil

OF

6,225,400

19

—Dec

at

oil

6,248,100

3^'

.

Distillate

2,226,000

jec

1

(bbls.)

output

(bbls.)

1,972,000

3ec

„_

Stocks at refineries, bulk terminals, in transit, in
pipe lines—
Finished and unfinished gasoline (bbls.) at
Kerosene

1,444,000

either for the

Month

PETROLEUM
September:

Domestic

:

of quotations,

cases

AMERICAN

of

(bbls.)_____

average

(bbls.)

oil

=

§1,674,000

—Dec. 19

Crude runs to stills—daily
Gasoline output (bbls.)

Distillate

3

in

or,

are

Latest

i.01.2

INSTITUTE:

condensate

42 gallons each)

Kerosene output

that date,

oi

ingots and castings

Dates shown in first column

Ago

874.3

Equivalent to—
Steel

production and other figures for the

cover

Year

Week

INSTITUTE:

(percent of capacity)

Previous

on

31

on

new

annual

capacity of

117,547,470

tons

obligations
outstanidng

Deduct—other

gations
Grand
Balance
under

subject

not

total

face

of

authority

$275,282,380

—

public

debt

obli-

$273,452,160,t $267,482,827

—

coc A4»

57o,452

577,148

$274,706,927

$272,875,011

$266,856,783

oao

...pl¬

2,124,988

8,143,216

debt limitation

outstanding

amount

above

to

;

obligations, issuable
-

*
„

—

293,072

„

626,043

fa

32

The Commercial and Financial Chronicle

t2656)

Continued

from first

calculated

a

page

come—the

the

of

fact

has been ; whittled
tremendously large

top 5%
and a

away

middle

has

class

Wall

In

created.

been

terminology,

Street

is bullish

of

share

the

that

this

the business outlook,

on

market

population
proportionately spends

the

has

most

in

the

had

Ours

income.

best

gains

longer

no

is

a

"carriage trade" economy—which
means a new stabilizing force has
into

come
we

now

than

being.

have

in

Case

home

more

point,

chips,

to

the

growth stocks. And this interest
embraces only about 10% of the
issues.

available

(2) At the

so

can't

which

of

wary

qualify

disparity

any

for

a

stock
top

has

values

in

been

created.

corrected—for

will

disparity

this

Eventually,
be

busi¬

so-called

tremendous new
markets for industry; Similarly, a

nessman's risks today

shorter

dollar

has

opened

up

has

work-week

leisure

new

the

for

which had led to

meant

masses

—

boom in travel,

a

There's

phasize

this

make

for

need

no

other

the

New

a

to

me

em¬

which

factors

Era—one

the

historians may term the "Fabulous
Fifties." For example, you're well
aware
of the implications of the

^reshuffling of
ters.

our

population

cen¬

the decentralization of

...

plant

required by new markets
and the necessity to off-set higher
freight rates.
Our daily living

contains

evidence

the

of

new

than

corrective
the

becomes

ventive

aluminum foil in kitchens

many-million

a

which

now

is

business

unknown six years ago

was

though

even

dollar

foil

long had been
used to wrap cigarets.
Further¬
more, the housewife's acceptance
of all types

of aluminum products
has been accelerated through fa¬

miliarity with the wrapping

ma¬

Another

Side

—

common

With

is

trical

equipment

with

For

stock

the

in

real

market

it

as

is

another

bullish

very

industry—for

Will

Wall

the

Once

Return

is returned
however, the posi¬
tive considerations will "jell" and
glamour

become

an

effective

price

stim¬

ulant.

J.the fact

that the

securities
witness

annual

volume

Vof trading

on the New York Stock
Exchange since the end of World

War II has averaged less than
17% of the shares listed. In sharp

contrast, the ratio

above 100%

was

in five of the 15 years ended 1930
—and fall below 60% only once.

This

decline

partly

in

reflects

demand
become

for

activity

fact

that

the

stocks

has

"institutionalized"—"pro¬

fessionalized."
"that

trading
the

common

Witness

the

fact

stockholdings
of
personal trusts, investment trusts,
pension funds now are over $40
common

Let

illustrate the

opportuni¬
problems—presented by
this conflicting background, the
difficulties in application to our
me

type

of

stock

market.

tomers

for

is

will

and

words,

the

the

analyst expensive exclusion

individual

story
has to

the

figures.
He
the
quantitative

appraise

facts

for

1954

"depression,"
I say let's have more of it.
Mar¬
ket-wise,
the
building
stocks
haven't been speculatively popu¬
lar for years.
Wall Street didn't
capitalize
the
1950
residential
boom on the theory it was non¬
recurrent. Yet, the collapse keeps
on

the

represents

being deferred. Result is that
building stocks give better
than

value for the security dollar

other groups.

many

Attitude

of

Professional

the

Investor

The

professional
an

has

investor

awareness

of this back¬

not to

compete with other fund

Yet, we recently wit¬
spectacle of outstand¬

managers.

itative facts, the
These usually are more important,
for there is a very personal ele-

ment
in
managing
a
business,
Some managements do little more
than rely on size—the momentum

of

big organizations — to carry
along. Others are progressive,
aggressive
and
dynamic;
these are the success stories.
Thus,

the

price

divergence

stemming from the creation of
dominant

new

interest

in

a

the

the economy,
and

Equity Prices

*

Purposely,
touching on
that

Lethargy

further

to

confuse

the

have

I've refrained from
the various factors
more

a

obvious

or

di¬

is a great temptation to emphasize
the fact that a managed economy

of

note

terized

indecision

1953.

period—one

We

which

are

where

in

characa

the

testing

security

buyer is

corporate

that

general

business

lower

operating

be

doesn't

much

as

companies

as

difference

there

particularly

fa-

industry outlook
generalizations,

an

permit

There's

even

in

is

today,

in

will

settle

people

coming

still

rates

demonstrated

in

is

forthsecu-

rity buyer may take heart and
display an aggressive interest in

the

elimination,

and

the market place. Until the public
is shaken out of its lethargy, the

ability to survive a
competitive economy, varies wide-

prospect of a broad upswing from
here out seems faint.

cushion

of

EPT

management

feet

15

of water, of a large lake or arm
an ocean. The water would be
,

of

protected

'against

•

contamination

far

beyond what is current practice at the Columbia River, since
it would be used to condense
,

steam
that

free of contamination

as

of

While

do

is

we

feel

that

power

exclusion

that

Ave

can/be

area,

we

should,wait
done

before

developments

power

made commercial.

be

as

plant.
expectation that
will eliminate even
or

our

need ior
not

atomic

to

ship

any

is

vious that at least

What

It

are

is

ob¬

10,000,000

cinch it is to

a

kw.

provide for

ciently high temperature
tbe sbeer problem of
the heat out of the

be¬

reactor

limiting factor rather
temperature differential

the

than

that

so

transporting

the

comes

This then permits

allowed.
obtain

us

to

without sacrificing

power

m

phitonium"production"

during the
plutonium is worth so
able • to produce
steam' permits us to use standard
heat transfer equipment for the
that

time

much. -

Being"

disposal Gf the
jow

final heat

temperature level

steam
answer

these counts, the

on

must

corporate

when

—

sit.,in

to

the usual physical security when
is part of our national scheme of you are on an island to protect
living. But this is another story people
against
the - results
of
and
the
subtle
factors
which enemy action against such a valumade 1953 a year of private bull able
target.
and private
bear markets still
(3) We would not g0 ahead unexist.
Similarly, it seems to me jess we could see our
way clear
that 1954 starts on the same keyto
produce the heat at a suffi-

earnings.
If a favorable

where

than

bearing on the outlook for of power could be installed at
equity prices. With your meeting favorable locations where water
being held in Washington, there can serve as the exclusion area,

with

condition

nicer

be

rect

issue, the security buyer is faced
a

water "that ''becomes
the
major
transportation cosU Nothing could

until*

a broad public
down gently—but not collapse—
preventing the normal remains to be proven. And, the
market phenomenon of the group
negative advantages of the infollowing the leader.
creased efficiency permissible at

if

condensers,

throughout

the

such

world

the

at

Ordinary
used

as

then

be-

practical.' This is a tremendous
saving - in
cooling
water
preparati0n and fancy heat intercome

surfaces

cbange

Building costs are an ex¬
pensive item in atomic installa¬
(4)

tions.

addition

In

to

having

to*

transport the men, materials and

Continued

from

page

12

housing
been

Atomic

other

Eneigy

facilities

into

far

away

design has generally
rather expensive as
com¬

places,

cus¬

the

pared to profit-paying power
plants. We would propose to use

barges or existing Maritime Com¬
for those who cur- mission
ships, particularly those
ready to treat rently must produce—no matter not considered too
seaworthy, tolook for help in the home.
Yet, the job as though it were any what the cost.
Specifically, what house the
power plants They cari
as
the population statistics indi¬
other development problem that are the new approaches we exprovide all of the facilities./that
cate, the help problem will be deals with
extremely toxic ma- pect to use as compared to the are"
needed,
and
ample
space,
acute, for a tight labor market
terials, intense local energy re- operations currently in vogue?:
They can be grounded at an offis in prospect. This means a stim¬
lease,
and
difficult control re(i) \ye wm not
be
satisfied shore
location
using sand and
ulated
demand
for labor-saving
quirements.
In such a case, the wjth
anything less than a breeder water as ballast as. well as for
devices—and the redistribution of
objectives are to keep the process reactor. Such
a reactor multiplies
shielding against radiations. Any
our
national income should

Indirectly, they
wife and mine to

pro¬

the

finance

to

means

Thus, the appliance

the

mar¬

of

direct

energy,

conversion

we

possible and in

rate

solar

long

-

range

were

inventory of toxic

as

and

segments

as

agents

as

as

many

practical.

low

sepa-

a\railable nuclear fuel by severaj

Simi-

hundred

times.

R.

In

fact, Dr.
Director of

time

it .is

locations

necessary

to

change

the structural details

or

Hafstad,: the
around the reactor, the sand can
ket has the benefit of a new, and
With
the
larly,
the
energy
release
will Reactor
Development of the U. S. be flushed out. Galvanic protecincreasing at higher, "normal."
certainly have to be achieved Atomic
Energy Commission, has tion will substitute for expensive
a $10
Incidentally, most people make with a minimum of structural
billion annual rate, a new
publicly stated that such a re- anti-corrosion
measures
on
all
class of security buyer has come the mistake of thinking refriger¬ members, heat transfer surfaces,
actor when developed may mulsurfaces that can be kept wet.
into being: the indirect investor. ators and
vacuum
and
cleaners
are
auxiliary
machinery.
The
fipiy the availability of fuel by
(5) We would not commit any
synonymous
of the
entire
ap¬ ideal control to aim for is a self- a factor of
Secondly,
the
contraction
in
2,000. This makes all more
capital investment than is
trading activity also reflects not pliance market. In actuality, how¬ regulating reactor, the output of 0£ the uranium and the thorium
absolutely necessary and
justi¬
ever, new appliance plus the rev¬ which is primarily determined by
only the restrictive influence of
available for
fission
instead
of
fied for the stage: of development
olution in America's living habits the amount of heat one chooses
the capital gains tax, but popular
only that 1/140 part of natural that we are in. For
to remove at any one time rather
example, the
are creating a tremendous demand
confusion as regards the meaning
uranium
that
is
U-235.
This
for many products.
More babies than by external power operated eliminates all concern about the barge or the holds of the ship>
©f the terms investment and specassigned to the turbo generators
mean more clothes and dishwash¬
regulators.
One should aim for cost
illation.
Basically, there is little
of the fuel and
its avail- would
be left
the simplicity of a steam-heated
empty until a suf¬
difference between the two—wit¬ ers; more houses mean more gar¬
ability>
It does not matter beficiently good reliability record
kettle.
It draws as much cause R can
ness
the old adage that a good bage disposal units and air condi¬ soup
hardly be found on for
producing steam has been es¬
Investment must also be a good tioners. Further, it's easy to con¬ heat as needed without ever the cost sheet.
tablished,
to
fuse saturation figures with sales scorching.
justify
the
next
speculation. After all, this nation
(2) We eliminate the need of investment. The steam would
has grown to its present stature prospects; theoretically, the radio
an
expensive
exclusion
area.
first be desuperheated,
Research to Reduce Costs
market
has
been
throttled,,
oversold
for
as a result of someone assuming a
Rather than going to out-of-the- and condensed in
temporary conAs explained before, we
calculated risk—which means in- years yet clock radios opened up
way places with the enormously densers to establish the need for
a
new
market.
The
theoretical ourselves in the unique position
telligent
speculation.
Yet
the
increased cost of
operation, in- the turbo generator, switch gear,,
saturation in the washing machine of not
average security buyer seems to
being obliged to do some- vestment in
.new
roads, homes, and the transmission line,
field applies only to be old-fash¬
regard speculation as either illeg¬
thing unless we can see our way etc., we
propose to go to large
ioned wringer type units—not the clear to oroduce power at
an in' we p™pos+e l°
lo iatge
(6) The most important differal, immoral or fattening—which is
automatics.
ridiculous.
A
fetish
has
been
teresting
teresting* cost. We determined
be fuCe between this operation an<*
If you'll grant the soundness of the
made of "investment."
simplifications in operation five
from
citv nower thOf Atomic Energy Commission
around

$108

billion.

assets of these funds

...

,

sio^arel

The
^

has

net

been

result

the

of

the

creation

foreging

of

a

new

type of stock market—one \yhere
the/selectivity, the divergence of
trend, has been vicious and

mising.

This because:




this

whether the institutional investor
will be
sufficiently attracted

by

the

fundamentals

companies which
sur¬

search

on

tions that
at

costs

are

arrive

necessary to

competitive

with

coal.

for

capitalize

to

can

the potential demand.
—as

fheP"ment"cos^^duc-

premise, the next question is rod

You and I

individuals willing to

assume

Then began research for the purpose

by

of

creating

methods

that

such

economies

might

be, too

7

vest pocket of the manager. It is
the
circulation
of
the
cooling

eventually

Investor's

interest is

As

-v

no

this

The

The lack of

group.

cost

a

longer need to worry about the
transportation of fuel., All that
imponderables, is needed can be carried in the

waiting to see whether
earnings will hold up
ing strength in a typical invest- as well as theoretically indicated
ment
grade building stock but in this coming year. The concept
the

nessed

at

area

of a communication^system^ to and
from the ^island. "After all,' we

known to everyone—and the qual-

by the Department of Commerce

to¬

be

products

many

will force your

©f

stocks

today's

children

than school seats.

vide

common

This present de¬

Furthermore,
morrow's

demand.

NYSE

to

If the readjustment forecast

year.

Re¬

ficiency, plus the constantly in¬
creasing
number
of
children
requiring schooling, points to a
steadily
expanding
market
for
school supplies and equipment.

billion whereas the market value

all

point

not the businessman's risks in the

ties—and

other
find

easing of mortgage money will market place will be heightened
help
finance
construction
next by the coming cross current within

as

to Wall Street,

In
to

behind

the build-

on

they

ground—and he today is attempt¬
ing to widen his approved list so

to

Street"

in double shifts.

—

illustration,

normal of demand. And the

new

shown

"Glamour

ly.
has

them
offer

are

ing
a

in

estate.

are

\ thing,
the
has changed

manufacturer

the population and income trends
also

of a broad bull market is
slim.
Supply and demand is as
effective a I determinant of price

their

one

common

The

other strings to their

many

To

shareowners.

business

ap-

spe-

professional
investor,
however,
surrounded by various security inhibitions, will choose the big elec-

miliarity with

as

in

any

purchased.

children now of kindergarten and
these gen¬
high school age will increase to
implication
by 1960.
of a new and higher "floor" to better than 42 million
the economy, there is another §ide Yet, our hation now is short some
345,000 school rooms; about 600,of the coin which is less reassur¬
000 children are going to school
ing
to
America's
6.5
million

■Comforting

eralizations

equipment

pect

cently, my attention was caught
by an estimate that the 35 million

Coin

the

of

active

only
one of every eight financially able
families a shareowner, the pros¬

new

terial.

and

ownership of
broadened.

markets opened

by America's in¬
genius.
For
example,

the

aggressive

is

the

But

will be slow—
won't be re¬
public interest

process

and direct
stocks

equities.

disparity
until

moved

invest¬

so-called

the

calibre

ment

for

sports equipment, etc.

offer better
in return for the security

value

con-

the

bow.

quality rating that the trend has
been exaggerated. In the process,
a

stock

time, the pub¬

same

lic has been

owners

before—and this in turn

ever

interest

blue

school

not

that

whenever

assumed

the professional

—

recognized

the

for the segment of our

which

place

investor—confines his

fact

mostly represent smaller
companies. We know that risk is

(1) The dominant factor in the

national in¬

our

or

risk—are

the

ialists

Changing Stock Maiket

redistribution

by

liance

The

rned

Thursday December 31, 1953

...

wl cTn

KeatTakes"or°7ny

of the

cities

the Long

now'^riej''on ^a'nd

Island S oVp^wer'^0^

Sound, bays and ports in general,

be

by

creases

merely

going

in the water.

obtain

the

five

miles

out

In this way we can

otherwise

available

expected.

prohibitive tinction

at

sites

where

in-

in power requirements are

This
to

is

in. contradis-

consuming

enormous

:>

Volume 178

blocks

of

for the

Number 5286... The Commercial and
Financial Chronicle

riched

(2,000,000

power

purpose

fuel

in

kw.)

of producing enareas that cto
not

have

a
large demand for power,
After all, transmitting power
long
distances cost more than it does

to

produce the

of

power at the

point

use.

Adding

ail

proaches

require

™

economieT,

and

should arrive at

a

plant that will

government

subsidy,

toVofproms'11 be aWe t0
vetopmen*

wi nlTn
menPt

to

basic

some

raw

moderator

taken

in

which

Dow

has

of

Dow.

We

have

made real

in

progress
unless at the time it

never

field

any

initiated,

was

ndb?' extreme' far"
practical3 oTwhatev'ItTlse
*
k

vou

ft

to r»n

Specifically, what

we expect

13 that first of

the

ducing plant by way of the first
step, and eight to ten years for
based

one

the

on

last

step

of

development would be reasonable
.

.

if

.

nothing interferes.

One must

realize

velopments of
society

power at

able

as

produce

whole.

a

Making

moderate price avail-

a

at out

of

-

potentially
for

de-

new

type

values of basic importance

enany
to

that

this

-

the

opens

production

-

places,

way

up

of

new

food,

areas

clothing,

and shelter.

Atomic energy makes

it

to

possible

industry

develop

based

able

lowest

generally avail-

materials

raw

the

on

cost and the most

essential

Atomic

ply

the fresh water supadequate to sustain new

is

the

Energy

Act

al-

^

.

atlve cannot b« accomplished if
there are n0 Private patent rights.
lt would be just the same as
thouSb one were to build a priva^e Saran factory on government property, subject to transfer
a^ any time to any competitor,
0ne can therefore expect the laws
to be changed eventually. But all
of those things will come when
the kite has been designed well
enough and the wind is strong
enough to give it a chance to rise,
if unburdened by extra strings,
We believe that

group of eom-

a

panies, willing and able,
advance this project.

marily

concerned

and

atomic

can

best

Dow is pri-

power

be

coal,

converted

into

low cost

by

almost all the

clothing,

power

These

thoughts

answer

Dow

specific

unprofitable, tax supported,
military expenditures, which we
fear will have to be called for.

is

it

pretty

that

Company,

organization,

as

should

a

be

in the future possibilities of atomic power. In the first

time

in

to

save

enormous,

now

the

interested

place,

plants produce
abundant by-produfct enriched

fuel,

should

why

Chemical

making

transportation

and education.
well

about

necessities for

housing,

You

not

believe

alone

is

this

from

see

that

troubles.

That

of

do

we

human

capable

short-cut out of

that

reason

finding

a

international

our

requires

genuine

allowing for half-goo d will. This is on the ascendthe
total
product Value to
go
ency,\but apparently not ready to
through
a
chemical
processing take oVer. In the meantime, we
step.
That
requires
chemical^must^t least match power with
background. In the second place, bigger potential power. With amwe

we

can

are

the

see

possibility of

nu-

clear energy circumventing many
of the complicated and expensive

and

processes

equipment

now

from

pie

new

we

will

atomic materials in view,
then

be

free

to

tackle

the next venture—more difficult,
and

even

important.

more

tically
in

one

that

of

the

think

for

measuring

perform¬

our
■

I am confident that attempts to
spell out too precisely what may
be

done

how

and

done

would

be

field.

There

can

it

should

be

outmoded

swiftly
by the brisk and steady march of
scientific development in this new
that

The

mistakes
common

Joint

be

will

no

not

guarantee
be

made.

denominator

of

the

Committee

hearings is the
uncertainty that lies ahead.
Opinion is divided among the
experts on almost every crucial
issue.

As

power

be economical—and when?

examples:

Will

atomic

How is the best way to attain it?
Would it come in on a sound basis
if

developed as a byproduct to
production of fissionable material?
How

soon

need

to

there

will

be

real

it

will.

It

cut drasof the high cost factors

chemically

fuel

elements.

reactor

reactors—

reprocessing
If

homo-

the

through,

comes

processing could be continuinstead

method.

of

There

today's

batch

other

are

reactor

designs,

also long range today,
that may suddenly emerge as the
best
hope for efficient nuclear

production. That is why I
emphasize the need for flexibility
power

in

this

joint

America

venture

with

to

provide
of

new

source

of

it—but also like taxes it

to

be

part

a

of

an

armament-burdened
A

and

uneasy

world."

um

actor

will

demonstrate

is

material—strate-

gically valuable
sians

have

have

fuel

quite

three-

security. Physically,

fissionable

safeguarded.

the

and

—

must

reactors

and

slugs. But it would be

valuable

for

them

to

only thing that seeins clear

me

the

that

is

of

to

ours

ciently in various types of
tors.

So,

we

maintenance

have

must

and

security

that

reac-

physical

means

in

answers

will

couple of them

a

behind the Iron

Curtain. This

gets us into personsecurity. What regulations can

nel

government
will

and

industry make
of loyal and

assure

FBI

us

to

Can

make

expect

we

investigations

non-government

private industy?

connected

Or to turn

over

its reports to private corporations?
This ties directly to labor-man-

long range was, in
feasible and short range.

truth,

or

It would

be

hibit

discourage

or

sad

a

mistake to

this

in¬

an

AEC

effort

to

and

unlikely
genius and accident have
of turning into fgct.
•




which
a

•

way

flux.

of

solutions

nature

I

hope

is

they

the need for

the

ta

in

a

prove

tion I described earlier.
Given

cri-

the

kind

of

the

leeway, X

necessary
confident that the

feel

plants and

and will do

how those responsibilities will be

legisla¬

AEC

can*

tration and

carried

I

out.

confident

am

that

the

steady improvement in controls will provide necessary flexibility
in
reactor
location.
No
does

longer

the

AEC

feel

that

these

good job of adminis¬

a

industry a good job of
speeding atomic progress. As to
the AEC, granting of legislative
discretion

carries

too

cautious

conservatism

I

ated

of the AEC. Let

West

Milton,

N. Y.—just

it

the

and

a

human tendency to cling to power.

giant machines have to be
located in the middle of deserts,
A powerful reactor will be operat

with

danger of bureaucratic inertia, a

Against

these

proud

am

admitted

to

dangers*

place

the record
tick off a few

me

of

outside

of

remote

development

search,

and

experi-

accumulated by the AEC.

ence
has

protection of plant workers
solved.

been

NO

individual

users

of

have

been

2%

insurance.

LESS

THAN

additional premiums be-

pay

of the nature of their work,

cause

The

times

the

vate
serve

amounts

spent in ordi-

plant safety programs. Is the
over-cautious?

Should

pri-

industry be required to obthe
same
stringent

standards?

v

who will enforce the

health

program?

As

safety and
of

today,

state nor Federal public
services have the knowl-

health

declassify

non-sensitive

energy.

available

made

for

commercial

(3)

production.
process
for recovering

A

economically
uranium

in

by-product
duction

acids

of

the

normal

pro¬

fertilizers

certain

has

private

small amounts of
phosphate ores as a
of

and

turned

been

industry

on

over

to

incentive

an

basis.

(4)

AEC
contractors
purified!
developed the metallurgy of
a
new
metal of great promisezirconium—and its production hasr
been
turned
over
to
private
management.
(5) We took up the suggestion
and

for

self-financed

economic

studies

feasibility

the

of

of

nuclear

six.
utility*
chemical, construction, engineer¬
carry this one, working in close
ing and one shipbuilding concern
cooperation
with
the insurance that are
engaged in such studies.
companies and with industry.
This record, I
submit, augurs
What about the pricing of goods well for our agency's cooperation
ecjge

or

it

So

manpower

looks

to do the job.

the

if

as

ar\d services. By goods, I mean
principally fissionable materials,
exam.£.e 0 services would be
the. p0SS1,ble government reproc-

f ™.acto* fuel and dls"

posal of radioactive wastes from

^^Itrative
d.
?

there

today

with

total

a

are

47

of

,

„

essmS

and

power

teams

AEC must

in

the

of

business-

formal

partnership
which I hope will be established
under
the
new
legislation. In¬
herent
upon
ness

problem

kind

and-government

in

of this is

all

both

parties

seek

to

ingenuity

for

a

a

demand

willing¬

^

.

P

once

solutions

new

with

and

,

should the AEC charge for
ices?

For

ments?

refabricating

For

fuel

conducting

ele-

applied

Century Controls Corp. of Farm-

labora-

ingdale, Long Island, N. Y.j is of¬

we

ful

here.

in

its

national

fission products or will the government have to take these off its
talking
industry — the so-called hands? How much should the govabout will occur. This argument "fast reactors"—may provide data ernment charge for this service?
ignores two hard facts: One—the directly related to weapons design Current thinking is that on serv-

adventure

of

use

be

have

I

fissionable

controlled

been

by the

But

reactors

since

being

some

the

of

considered

must

government

and

as

know-how

America's

of

some

is

tied

in

up

—at

this

dollars

stage—the

required

the atom.

inventor in
not

seem

fool

to

of

vital

the

re-

around

Unfortunately, the

is

unlikely that we can open
information completely for .a
long time.
pp

Thus,

have

We

little

with

garret or garage does
have much chance to

tions

tons

HRE.

down

machine
It

concrete

around

it

injury.
at

Oak

called

Reactor

geneous

of

of

have

power

Ridge

the

a
Homo¬

Experiment—

produces token

electric

because

of

its

Siamese

twin

something that must

a

to

millions

relationship to defense, the
spelling out of security regula-

now.

amounts

Its design

will

be

real

a

government and
mean

in

problem

for

industry. And it

added

expense

nuclear

power

to

in-

Turning
must

potentially
release

ices,

government. should

the

of

to
deal

health
with

deadly
harmful

and
a

Part

safety,

new

and

menace—the
amounts

of

be

of

the

net

proceeds from
acquire

this sale

are

certain

equipment,

to be used to

including

a

complete model shop, and the re-r
working capital-

maincler added to

reimbursed for the full cost of
Century Controls Corp. was in¬
All these questions must be corporated in Delaware on Sept.
worked out in the tedious job of 2, 1953 and acquired all the stock
preparing and carrying out the of Century Controls Corp., a New
incorporated
regulations regarding licensing of York corporation,
same.

the use of fissionable material and
will tax the ingenuity of both the

government and private manage-

ment.
IV

-

motive in

reciting these adminis-

trative

problems.
using

a

I

am

damp

not

pur-

towel

the

16,

1953,

accessory

company.

and

manufacturing
systems
and
the aircraft in¬

control

components

for

dustry.

Giving

to

genuine ferment in
industry and in the Commission to
get into the field of nuclear power
and other applications of atomic
smother

which will be the
The latter
will operate in the State of NewYork in the business of designing,
Feb.

operating

developing

Please do not misunderstand my

posely

opera-

tions.

we

ing is not underwritten.

by

private

material

Stock Offered

serv-

research

call
government's apron strings,
the very kind of pioneering and

<

Instru¬
ments developed in AEC research

working in atomic plants today is
denied

atomic

tories? Will engineering develop fering to the public an isSUe o£
fast enough to enable industry to 300,000 shares of its common stock,
find a market for the by-product at par ($1 per share). The offer¬

the

know is true today.

improbable

state

out

whose

visory Committee on Industrial
Information, on which the NAM
has a representative, is most use-

dustry

must

work

problems

information. The work of the Ad-

physical

the basis of
We
not be forced to neglect the
on

and

ver

of

kind

adventure.

Some may say that if only
cut loose from what they may

administrative angle. The
must continue its sustained

from

project too

much

nuclear power

that,
at
this
point, both the government and
industry need freedom to maneu¬

de-

teria for the location of privately
owned

thesis

Century Controls

possible

will

we

col-

to present realis¬

some arguments to buttress

main

my

pSiStaSSSrtSST

just to protect the inventor from

what

ap-

just trying

tically

infinite patience.
Together we must seek out all the
agement relations and the prob- °»
lems of determining standards of cieai power plants actually stalts- possibilities of this great new field
of atomic energy to promote the
security risks that also preserve
What is to be done with the
effectiveness of the great civilian
This has been the history of fundamental individual rights.
Plutonium—even small amounts
and industrial economy which its
applied electric power, the auto¬
Data on the slug's performance Produced as a by-product of reAmerica's greatest source of hope
mobile, the airplane — in fact — —its burn-up, composition, etc.,— actors
designed
primarily for
and strength:
every
great
scientific
develop¬ may be of technical significance power? Can the plant sell it as
ment. In atomic energy, the last and that is the third
aspect of seto new plants? Will the gov11 years has shown us so often
curity of information—and per- ernment buy it? At fuel prices or
that what we believed was im¬ haps' one
of
the
most
difficult weapon grade prices? How much

tinker

an

up

more

safety engineering
parently than do our British
leagues. The problem is to
termine the responsibility of
government in establishing

added^either

costs, because of the

need
for
24-hour
guard, secure
storage and accountability records.
The
people who handle these
slugs must be loyal and not slip

atmosphere fa¬
vorable to new and daring solu¬
tions. I hope we will not try to
come

have

we

in

AEC

some

with

to

In this respect,

study their
metallurgy, the kinds of alloys or
cladding we use, etc., to make
these
slugs perform
most
effi-

hold of

each other.

best

up.

faith

nary

it

The

blown

yet

and we do not expect any to blow

get

management simply cannot afford

present

power?

has

reactor

safety record in AEC plants
the Rus- is phenomenal. But it has cost a
therefore lot of money to achieve it—-many

know

We

be

Scientists, in¬
dustrialists, economists and gov¬
ernment
experts
disagree
with

supplement
of

No

The

single slug of enriched uraniready for insertion in a re-

fold aspect of

it

seems

covery of weapons material from
the products of nuclear reactors,

sources

reactor, and the protection of the
workers in the industry,

care

because of its top priority role in
national defense. Two — private

a

the location of the

on

Schenectady. To take instances of this agency's cohfjeracontingencies, it tion with and encouragement of
III
will be housed in a giant pressure private enterprise.
Now for some practical prob- vessel — that big sphere you've
(1) At the outset, the AEC de¬
lems of administration. There are seen so often lately in pictures, cided to continue and expand the
many and I would like to touch And
we are building some
big policy of using private contractors
briefly on just three—Security, reactors in South Carolina not too to do its work.
<2) It has encouraged the birth
Safety and Pricing Policies. Chair- £ar from the city of Augusta,
man
Strauss has aptly said that Private industry faces the prob- and growth of a brand new in¬
"Seeurity is a troublesome thing, lem of public liability and its dustry—that of supplying special
instruments and machines to the
Like taxes, I would
gladly be rid solution will rest largely on rea

energy.

the

Industry Should Have Greater
Share in Nuclear Development
and

solution,

a

conventional

more

for

ance.

am

and

power reactor. It may

a

that

13

page

energy that promise rewards i/V
proportion to the risks taken. X

which focus

in

reliable workers?

Continued

radioactivity. This breaks down
environmental
safeguards

long range today. Tomorit may be the top choice as

row,

ous

^

populations.

Air, water, clay, salt
oil, gas, or wood can

all

are

into

coolant

luel,

scientists

this

actually

* ^

kite

good

to that

Building up a new industrial
defense potential by private initi-

wherever the

climate and

pipe and a
homogeneous

a

seems

Energy

and tying

plutonium-pro-

a

its

geneous

Atomic

™

Three years for

because

pot,

dubbed

leading position from its The thing has some serious bugs
inception.
Finally, rFds in line in it. It may never be a significant
with the very spirit and
concept power producer. But some very

Pay

simple and

It's

a

refinementinTZVerightist Ihe
lTXrLranbfSsafdf about''the
tellMgTm^elled
if
about tbe to be ultra-conservative
more

simple—a

chemistry

and

difficult but also

is

pump.

HoteX" debated

a„LrjLan Eay

fn;

produce

materials, possibly opening a
bigger field than that of electro-

back

Wants No Government
Subsidy

not

used

33

(2657)

effect

to

the

above-

mentioned financing, the company

outstanding
810,000
shares out of an authorized issue
will

of

have

1,000,000 shares.

(

The Commercial and Financial Chronicle

(2C58)

34

Thursday, December 31, 1953

...

★ INDICATES

Securities Now in
if A & B Commercial Finishing Co., Inc.
18 (letter of notification) 120,000 shares of class A
common stock.
Price—At par ($1 per share). Proceeds—
Dec

Office—728 South

equipment and working capital.

For

around $10 per

share). Proceeds—To repay bank loan, to
acquire capital stock of nine Louisiana companies and to
expand their ammonia storage and distributing facilities.
Underwriter—Lee Higginson Corp., New York.

Wheeling, Tulsa, Okla. Underwriter—White & Co., Tulsa,

Okla., and St. Louis, Mo.
•

Industries, Inc., Oklahoma City, Okla.
5,000,000 shares of class B non-voting com¬
stock (par one cent). Price—$1 per share. Proceeds

(1/4)

Amalgamated Growth Industries, Inc.

3 filed

mon

Price—$2 per share. 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,

—To construct

Cincinnati

American Diamond Mining Corp.

(letter of notification) 260,000 shares of common

&

Suburban

Bell

99 Wall

St., New York 5, N. Y.

Underwriter—Samuel W.

Gordon & Co., Inc., New York,

if Ancient

River Channels Gold Mining Co.
Dec. 22 (letter of notification) 1,000,000 shares of com¬
mon stock.
Price—At par (10 cents per share). Proceeds
—For exploration and general corporate purposes. Office
—Suite 1, Cornet Bldg., Las Vegas, Nev. Underwriter—
None.

Appalachian Electric Power Co.

(1/11)
$20,000,000 first mortgage bonds due 1983.
Proceeds—To repay bank loans and for new construction.
Dec.

filed

9

Underwriters—To be determined by competitive bidding.
bidders: Halsey, Stuart & Co. Inc.; The First

Probable
Boston

Corp.

To be received

by the

Co.

&

Corp.; Kuhn, Loeb
(jointly); Harriman

company

Union

and

Ripley

Co.,

&

to 11

up

Securities

Inc.

Bids—

(EST)

a.m.

on

Jan. 11.

Consumers
be

3 filed

Power

ISSUE

Bids—To be received up to
,

Co., Jackson, Mich.

679,436 shares of

common

stock

(1/6)

/

(no par) to

offered^ for subscription by
"Jan.

record

each 1Q

7,

1954

common stockholders of
basis of one new share for

the

on

shqres held; rights to expire

Jan. 22.

on

Unsubi-

first to employees.

Price

—To

for subscription by common stockholders of record Nov.
27

Probable

Nov. 6

on

l-for-3

a

basis; rights to expire Jan. 8. Price—
share). Proceeds—To reimburse treasury
for expenditures made for extensions, additions and im¬
provements to plant. Underwriter—None.
($50

per

...

Pec. 23 (letter of notification)
stock

16,000 shares of

common

(par $1).

Price—$6.25 per share, or last sale price
Angeles Stock Exchange preceding date of
sale, whichever is lower. Proceeds—For working capital.
the

Office

Los

408

—

Junipero St.,

bidding.

San Gabriel, Calif.

Under¬

bidders:

Morgan Stanley & Co.; Harriman
The First Boston Corp. (jointly)Lehman Brothers. Bids—Expected to be received
up to
11 a.m. (EST) on Jan. 6 at 20 Pine
St., New York, N. Y.

Ripley

•

if Clary Multiplier Corp., San Gabriel, Calif.

on

N. Y.

REVISED

be determined by the company and announced on
Jan.
4. ^ Proceeds—For construction
program.
Under¬
writers—To
be
determined
by competitive

stock (par $1).

Price—$1.15 per share. Proceeds—To ex¬
plore and develop the Murfreesboro, Pike County, Ark.,
property and for general corporate purposes. Office—

ITEMS

scribed shares will be offered

Telephone Co.
filed 312,812 shares of common stock being offered

At par

Dec. 8

Underwriter—None.

'

stock (par 10 cents).

N. Y.

mill.

PREVIOUS

Co.; The First Boston Corp.
11 a.m. (EST) on Jan. 6.

Dec.

Cherokee

\)ec.

Sept. 28 (letter of notification) 149,999 shares of common

Registration

ADDITIONS

SINCE
•

&

.

Co.

and

Continental

Divide

Uranium Co., Inc. (1/4)
notification) 599,000 shares of common
cents). Price—50 cents per share. Pro-

Dec. 8 (letter of

<par/l0

stock

ceeds-f-io repay loans, for exploration and drilling
pense^, equipment and working capital.
Israel"& Co:, New York.

ex<-

Underwriter
>

writer—None.
Coleman Co.,

Inc., Wichita, Kan.
(letter, of notification) 1,200 shares of common
(par $5).
Price—$28 per share.
Proceeds—To
sellipg stockholder. Office—250 No. St. Francis Ave.,
Dec.

2

stock

Wichita,-;-Kan.

Underwriter—James

E.

Bennett

&

Co.,

Consolidated Edison Co. of N.

"Dec." 2 filed $35,000,000 first

Y., Inc. (1/6)
refunding mortgage

and
1984.

surance-Co.

the

on

bonds, series J, due Jan. 1,
Proceeds—To repay
bank toans and for construction
program. Underwriters
—To be determined by competitive
bidding. Probable
bidders: Halsey, Stuart & Co. Inc.; Morgan
Stanley &

preferred

share

stock

Chicago, 111. No general offer planned..
■<$

if Continental Fidelity Investment Co.
Dec. 22 (letter of notification)
200,000 shares of class A
common stock and 10,000 shares of class B common
stock
to be offered in exchange for stock of Sunland Life
Inr

each

for

None.

basis

of

of

40

Sunland

Sunland

class

and

A

shares

share

one

share.1

common

for

of

each

class

Office—4,608 South Main St., Houston, Tex.

if Coronet Kitchens,
Dec.
mon

For

Fort

Inc., Fort Lauderdale, Fla.
notification) 142,100 shares of comr
(par $1). Price—$1.25 per share. Proceeds—
working chpital. Office
224 S. Federal
Highway,
Lauderdale, Fla. Underwriter—None.
23

(letter

of

stock

—

if Arkansas-Tennessee Natural Gas Co.
Dec. 21

(letter of notification)

1,800 shares of

stock (par $1). Price—$13.25 per share.
F. Grizzle, of Sheffield, Ala.

common

Proceeds—To B.

NEW ISSUE CALENDAR

Underwriter—Scott, Horner

&

Mason, Inc.,' Lynchburg, Va.

January 2

Armstrong Rubber Co.
Nov.

27

common

—To

(letter of notification) 1,000 shares of class A
stock (no par). Price—$21 per share. Proceeds

James

A.

Walsh, the selling stockholder.
writer—Gruntal & Co., New Haven, Conn.
Atlantic

Refining Co.

due

Jan.

amendment.

15,

1979.

Proceeds—For

—

To

be

expansion

(Offering

by

supplied

share).
writers

(1/25-29)
61,000 shares of series B 6% cumulativepreferred stock.
Price
At par ($10 per

Bioren & Co. and H. G. Kuch &

Philadelphia, Pa.

Under¬

(R.

A.

(Israel

(Louis

Saaty

Fuel

to

be

offered

for

subscription by

of Southern Union Gas Co

basis

of

common

To

share

one

share

of

stock

common

of record Dec.

Aztec

for

each

held; -rights to expire

(par $1)

Southern

Feb. 8.

on

on

Union

Co.)

;

Corp.

of

(Wednesday)

Co

.Common
11

a.m.

EST)

527,830 shs.

$299,500

Co.)

Co.)

R.

Lewis,

Bros.

Federal

(H.

M.

(par five cents).

Price—40 cents per share. Pro¬
ceeds—To acquire properties and leases. Office
Blatt
Bldg., Santa Fe, N. M. Underwriter—Hunter Securities

Co.—

..Common

Common
Common

<4

$181*662""

Preferred

Webber,

Jackson

&

'

«•

.

j

January 15 (Friday)
Gas

i.

Co

Common

.-

January 18

.

Gas

Co.

(Monday)

Fire Association of Philadelphia...
Common
«
p(Offering to Istolckhqlders—The First Boston Corp.
irV
wil1 act as advisors) $7,650,000

-

"

'

January 19
Iowa-Illinois

Gas

&

(Tuesday)

Electric

Co...

Preferred

'■

.1.

Co,u.«^jk^i—Uommdii

(Bids

Ohio Edison

Irpj.) $100,000

10

Westbrn

r

,■

invited) $22,854,000

$4,000,000

Bonds
u

Casualty

(Kidder,
-

CST)

a.m.

Co
.(Bids

.

Corp.—
I—Class A
(Aetna
Securities Qorp.) $300,000
Montreal (City of)
.—-^—Debentures
be

Paine,

$3,000,000

(Offering to stockholders of Southern Union
~—no underwriter)
2,055,977 shares

$800,000

$39gJQ0->».

Byllesby.

(Bids to

4

JCommon '

Electric-*Products

«,

"

Aztec Oil &

$250,000

Fiber Glass Plastics

if Basin Natural Gas Corp., Santa Fe, N. M.
Dec. 23 (letter of notification)
748,000 shares of common

'

i;/.

$-300,000

Co.)

and

,

i

&

Co.

Curtis)

(May be The First Boston Corp. and Blyth & Co., Inc.)
"r $7,000;000 preferred and 225,460 shares of common

iDqmmon

(Tuesday).

Co.,
(Capper

&

.

$300,000
„

Inc.)

Januarys

Tully

■

Kansas City Power & Light Co.___Pfd. & Common

_____Debentures

Co.)

Corp
&

(Mitchum,

k

&

(Thursday)

Geperal Telephone Co. of California
:i

America...._.

(John

Diamond

Common

Co., Inc.—.Common
r

McClure

"(Tellier

Triplex

Price—

Underwriter—None.

-

$299,098

(Sills, Fairman & Harris, Inc.)

the

supplied by amendment. Proceeds—To acquire
equipment and property, for drilling wells and for work¬

stock

C.

(d'Avigdor

e

stockholders-

28, 1953

Inc.)

Saint Anne's Oil Production

be

ing capital.

&

(1/15)

common

Co.,

Injector Corp...

*

Dec. 14 filed 2,055,977 shares of

Keppler &

Three States Uranium

Co.r Dallas, Tex.

Edison

-(Offering t0**stockliolders—bids

January 14

(Monday)

Continental Divide Uranium

Co., both of

>

Aztec Oil & Gas

Ohio

by

$100,000

Amalgamated Growth Industries, Inc.:

—

Proceeds—To increase working capital.
—

Co.)

Mutual Finance Co

filed

convertible

&

'

January 13
.Debentures

.stockholders—underwritten

Garrett

^Automobile Banking Corp.
28

preferred

etc.

program,

Underwriter—Smith, Barney & Co., New York.
Dec.

to

*

(Saturday)

Inc

January 4

(1/6-7)
Price

Service,

Under¬

Dec. 16 filed $55,000,000 of 25-year
sinking fund deben¬
tures

Petroleum

,

EST)

a.m.

&

Peabody

Surety
&

Co..:

Common

Co.

and Prescott,
150,000 shares

Snider Co.)

,

$30,000,000

Wright.

—

Corp., New York.
•

Atlantic

Carolina Telephone &

Aug. 17 filed 33,320 shares
for

t

of capital stock to be offered

in the ratio of

one

new

share for each five shares held.

Price—At par ($100 per
Proceeds—To reduce short-term notes. Under¬
writer—None. Statement to be withdrawn.

share).

series D

Chemical
21

filed

cents). Price

Enterprises, Inc., New
350,000

shares

of

York

common

stock

To be supplied
by amendment

(par 25

Co.)

11

EST)

a.m.

Common

Wallace
(The

Co,

California

Class A

Co.,

Lester,

Inc.;

Ryons

January 7
Webster

&

Co.)

& Gas

Securities

Eichler

Higginson

(Bids

&

iBioren

January 11
11

Eitel-McCullogh,

a.m.

$1,500,000

(Offering

Houston

to

&

Co.)

New York

Boston

Philadelphia

Pittsburgh

San Francisco




to

all

offices

G.

underwriting)

Bank
to

&

Co.)

$610,000

1,000,000 shares

(Wednesday)

invited)

16

be

to

$5,500,000

(Tuesday)

& Electric

to

Co..

invited)

be

March

$43,358,000

jL.

stockholders)

Corp.

Becker

11

Gas

(Bids

Common

Suburban

$500,000

and

Morgan
$100,000,000

Bonds

$12,000,000

(Wednesday)
Co.

3

&

Co.

a.m.

Inc.)

CST)

Electric
(Bids

invited)

..Bonds
$5,000,000

(Wednesday)

Co
be

to

Bonds

invited)

$4,000,000

and

Stanley

&

Co.)

16

March

Alabama

Power

(Tuesday)

Co

(Bids

to

Bonds
be

invited)

$17,000,000

...Common

April

100,000 shares

Public Service Co. of Indiana, Inc.—*
(Bids

Preferred
Kuch

Bonds

be

February 17

Marquette Cement Mfg. Co....
(A.

Private IVires

G.

Common

ilssex County Electric

Bonds

Boston

H.

..Debentures

Chicago

Cleveland

Louisville

$840,750

Development
First

(Monday)

Securities Corp.)

(Bids

International Bank for Reconstruction
(The

and

February
Bonds

(Tuesday)

stockholders—no

(Offering

Co.

(Bids to

$20,000,000

Co

National

$2,500,000

.Common

January 12
Edison

Debentures

.

Inc.)

Mystic Valley Gas Co

(Monday)

EST)

Co.,

February 10

$3,000,000

Inc.

(Schwabacher

Detroit

&

(Union

CST)

&

Colorado Oil & Gas Co

shares

Appalachian Electric Power Co
(Bids

(Blyth

Bonds

...

$20,000,000

(Friday)

Co...

January 25

Equip Trust Ctfs.

noon

EST)

a.m.

Preferred

Corp.)

350,000

shares

Co.;

Common

Corp.)

50,577

Automobile Banking Corp

Co

Missouri Pacific RR

(probably

Power

$300,000

Chemical Enterprises, Inc
(Lee

10:30

January 22
Tail

Common

(Thursday)

Central Illinois Electric
(Stone

Bateman,

&

Co.)

EST) 679,436 shares

Otter

Container:

First

a.m.

&

Michigan Consolidated Gas Co
(Bids

ICommon

...

(McDonald

$55,000,000

York, Inc.—Bonds

(Wednesday)

Harris-Seybold Co.

$35,000,000

(Offering to stockholders—bids 11

stock,

(1/7)

&

Consumers Power Co.—

and

(par $100). Price—To be supplied
by amend¬
ment.
Proceeds—For new construction.
UnderwriterStone & Webster Securities
Corp., New York.
Dec.

(Bids

;

Debentures

Barney

January 20

,

(Wednesday)- \

Co

Consolidated Edison Co. of New

Illinois

Electric & Gas Co. (1/7)
Dec. 9 filed 15,000 shares of
cumulative preferred

•

Refining
(Smith,

Telegraph Co.

subscription by stockholders

Central

January 6

$25,000,000

Bonds

B

Underwriter—

Georgia

Power

6

(Tuesday)

Co

(Bids

to

Bonds
be

invited)

$11,000,000

Number 5286

Volume 178

.The Commercial and Financial Chronicle

..

(2659)

^ Oaniefson Manufacturing Co.
Dec.- 24

(letter of

House of Better Vision, Inc.,
Miami,"Fla.

notification)

10,704 shares of class A
preferred stock (par $5) to be offered for subscription
by stockholders. Price—$9.50 per share.» Proceeds—For
working capital. * Underwriter—Coburn & Middlebrook,
Inc., Hartford, Conn.

Nov. 25
stock

Feb.

1, 1954.

Price—At

loans and for

held; rights to expire

Dec.

Dec.

16

Price

filed

•

on

tubes.

—

Office—San Bruno, Calif.

vacruuffi

•

Federal

Dec.

17

Electric

Products

power

for

working capital.

Underwriter—A.

Kalb

&

Co., 325

Fiber

Glass

(1/19)

underwriting
purposes.

England Gas & Electric Association

(par $8)

(letter of notification) 40,000 shares of cumula¬
To

—

to be offered

in

exchange for

stock

common

of New Bedford Gas & Edison

ity stockholders

repay

on

Light Co. held by minor¬
the basis of 4% New England shares

for each New Bedford share held.

Ohio Edison Co.
Dec.
to

(1/13)

10 filed

527,830 shares of common stock (par $12)
be offered for subscription by common stockholders

of record Jan. 14. 1954

the basis of

on

each 10 shares held (with an

one

new

share for

oversubscription privilege);

rights will expire on Jan. 29, 1954. Price—To be named
by company on Jan. 11. Proceeds—For construction pro¬
Underwriters—To

gram.

be determined by competitive
Probable bidders: Morgan Stanley & Co.; Leh¬

bidding.

Brothers

and Bear, Stearns & Co. (jointly); The
Corp.; Merrill Lynch, Pierce, Fenner &
Beane and Kidder, Peabody & Co. (jointly); Glore, For¬
gan & Co. and White, Weld & Co. (jointly)flBi^s—To be
received up to 11 a.m. (EST) on Jan. 13.

Dec.

$12,000,000 of bank loans

and for

new

man

First

construction.
Boston

Boston

Ohio

Edison

10

filed

4

writers

Co.

(1/19)

first mortgage' bonds due
additions, etc. Under¬
by competitive bidding.
Stuart & Co. Inc.; Morgan

$30,000,000

of

Probable

1984.

Underwriter—None.

Office—500 N.

E.

59th

Proceeds
To

—

For

—

be

property

determined

bidders: Halsey,
Stanley & Co.; The First Boston Corp.; Glore, Forgan &
Co., White, Weld & Co. and Union Securities Corp.
(jointly). Bids—To be received up to 11 a.m. (EST) on

if Key Corp., Miami, Fla.
Dec. 22 (letter of
notification) 300,000 shares of class B
common stock.
Price—At par ($1 per share). Proceeds
—For inventory and promotion. Business—Ethical
phar¬
maceuticals.

Plastics

New

iewelry stores.

(letter of

stock

Market St.. Trenton, N. J.

20%

Kay Jewelry Stores, Inc., Washington, D. C.
Sept. 28 filed 672,746 shares of capital stock (par $1) to

'

Pipe & Foundry Co. (N. J.)
-•*££•notification) 39,000 shares of common
(par 25 cents). Price—$1 per share. Proceeds—For
purchase of land and machinery, to erect buildings and
16

Under¬

be offered in exchange for
preferred and common stocks
of 71 store
corporations which operate 83 retail credit

Federal

Nov.

14

a

Dec. 10 filed 32,126 common shares of beneficial interest

Underwriters—Blyth & Co., Inc. and The First

selling stockholder. Office—50 Paris Street, New¬
N. J, Underwriter—H. M. Byllesby & Co. (Inc.),
'

(par $1).

investment.

Exchange, with

determined

pay

$1).

Chicago and New York.

Proceeds—For

Stock

Corp., both of New York.

(1/5)

is the

ark,

9,000,000 shares of capital stock

market.

Oils, Ltd., Toronto, Ont., Canada

commission. Proceeds—For general corporate
Underwriter—To be named by amendment.

Kansas City Power & Light Co. (1/14)
Dec. 21 filed 70,000 shares of cumulative
preferred stock
(par $100) and 225,460 shares of common stock
(no par).
Price—To be supplied by amendment. Proceeds—To re¬

(letter of notification)

(par

the Toronto

by competitive bidding. Probable bid¬
Corp.; Lehman Brothers; Blyth &
Co., Inc.; Kuhn, Loeb & Co.; Glore, Forgan &
Co.; Mer¬
rill Lynch,
Pierce, Fenner & Beane and White, Weld &
Co.
(jointly); Harriman Ripley & Co. Inc.; Salomon
Bros. & Hutzler.
Bids—Expected to be received up to
10 a.m. (CST) on Jan. 19.

10,000 shares 6f common
Price—Aggregate offering price fwill
riot exceed $100,000. Proceeds—To Estelle M.jCole, who
stock

New Bristol

Dec. 18 filed 1,000,000 shares of common stock (par
$1).
Price—To be related to the bid price of the shares on

ders: The First Boston

-I

Co.

Underwriter—None.

Underwriters—To

Und er writers-Schwa-

bacher & Co., San Francisco, Calif.

filed

Proceeds—To lend up to $25QJ)09*
the loan to be secured by accounts
Office—4313 Hamilton St., Hyattsville, Md.

receivable.

Fla.

Iowa-Illinois Gas & Electric Co.

be

(1/11-15)

Manufactures

Co., Inc., Miami, Fla.

tive preferred stock (par $100).
Proceeds
bank loans ancl for new construction.

114,000 shares of common stock "^par $1).
per share.
Proceeds — To two selling
Business

28

Dec.

Underwriter—None.

$7.37 V2

—

stockholders.

Gables,

of

Price—$100 per unit.
to Genie Craft Corp.,

Office—268 E. Flagler St., Miami,

writer—None.

Co., Trenton, N. J. (1/5-6)
Dec. 17 (letter of notification) 199,800 shares of com¬
mon stock
(par 50 cents). Price—$1.50 per share. Pro¬
ceeds—For working capital, etc.
Underwriter—Capper
& Co., New York.

Eitel-McCullough, Inc.

Coral

Price—At

Diamond Bros.

•

Co.,

stock (par $5), to be offered in units of one
preferred and one share of common stock.

common

share

if Investors Mutual, Inc., Minneapolis, Minn.

Proceeds—To repay bank

par.

construction.

new

A
common

Proceeds—

capital, etc. Underwriter—Barham

&

the basis of $100 of deben¬

on

share.

per

Hydrocap Eastern, Inc., Philadelphia, Pa.

(1/12)
Dec. 10 filed $43 358,000 3J4 % convertible debentures due
Feb. 1, 1969 to be offered for subscription by stockhold¬

6, 1954,

Price—$1

Oct. 30 (letter of notification)
100,000 shares of common
stock. Price—At par ($1
per share).
Proceeds—To pay
debt and for working

Detroit Edison Co.

of record Jan.

cents).

For working capital.

Records, Inc.
Dec. 22 filed 145,842 shares of capital stock (par 50 cents)
to be issued only in exchange for shares of Universal
Pictures Co., Inc. common stock (par $1).

ers

50

Fla.1 Underwriter—Curlette &

Decca

tures for each 25 shares of stock

(letter of notification) 299,500 shares of

(par

35

Jan.

St., Miami 37, Fla.

•

Underwriter—Hugh L. Sowards.

19.

Oil

Financing & Development Corp.
(letter of notification) 29,986 shares of 50-cent
preferred stock (par $1) and 89,958 shares

Nov. 25

Corp. (1/5)
(letter of notification) 200,000 shares of class A
stock (par 10 cents).
Price—$1.50 per share. Proceeds
—For purchase of plant facilities and equipment and
for working capital. Office—52 Davenport Street, Stam¬
ford, Conn. Underwriter—Aetna Securities Corp., New

if Lake Pleasant Inn, Inc., Peoria, Ariz.
Dec. 18 (letter of
notification) 200 shares of class A pre¬
ferred stock. Price—At
par ($500 per share). Proceeds—
To complete and
equip buildings. Underwriter—None.
• Lexington Trust Fund, New York City

cumulative

York.

Dec.

Securities

Dec. 29

„

Fire Association of
Dec.

Philadelphia

(Pa.)

(1/18)

11

filed 340,000 shares of capital stock (par $10) to
be offered for subscription by stockholders of record Jan.
18

the

on

basis

of

share

for

each

share

held;
share. Pro¬
ceeds—To increase capital and surplus. Meeting—Stock¬
holders will vote Jan. 14 on increasing authorized num¬
ber of shares from 360,000 to 800,000.
Underwriter—None,
rights to expire

but

The

visors

First
the

to

Florida
Nov. 6

on

one

new

Feb. 17.

Boston

Price—$22.50

per

Corp., New York, will act

as

Oil

Co.

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.,
Fluor

1947 series

stock,

amendment.

May

Calif.,

and

Price—To

be supplied

by

Proceeds—To repay bank loans and for new

construction.
ment.

(par $20).

Underwriters

—

To

be

named

by amend¬
San Francisco.

be Mitchum, Tully & Co.,
Paine, Webber, Jackson & Curtis,

Mass.

Boston,

S

Greenwich Gas Co., Greenwich, Conn.
Nov. 12 filed 75,468 shares of common stock (no

Marquette Cement Mfg. Co.

b.e first

offered

for

subscription by the holders of the
89,333 shares presently outstanding for a 10-day standby;
then to public.
Price—To be supplied by amendment.
Proceeds—From
from

private

used

to

repay

sale

—A. G. Becker & Co.

Underwriter—F. L. Putnum &
and

Providence

(R.

Co., Inc., Boston, (Mass.)

N.

9

Gulf

Sulphur Corp., North Kansas City, Mo.

stock.

purchase drill

•

participating stock (par 10 cents). Price—$10 per share.
Proceeds—To develop company concessions. Underwriter
—Peter Morgan & Co., New York.
if Harris-Seybold Co.,
Dec.
to

30

filed

be Offered

of

record

share
Feb.
be

for

50 577

Jan/

somewhat

of

for subscription

each

1, 1954.

Cleveland, Ohio

shares

19,

1954,

common

bv

on

common

the

(1/20)

stock

basis

(par

$1)

stockholders

of

one

new

shares

seven

held; rights to expire on
Price—To be supplied by amendment (to
below

the

market

price).

Proceeds—To

reimburse company's treasury for its investment in C. B.
Cottrell & Sons Co., and for general corporate

purposes.

Underwriter—McDonald

if Hershfisfd
Dec. 21
common

For

Co.,

Cleveland, O.

(H. A.), Jr.,

Inc., Tulsa, Okla.
129,000 shares of class A
Price—$2 per share. Proceeds—

(letter of notification)
stock

(par $1).

drilling and leases.

Okla.

&

Office—1307 East 38th St., Tulsa,

Underwriter—None.




stock

(par $10).

Dec.

Office — 10 East Corydor^St.,
Underwriter — Winner & Myers, Lock

—To

,

19

filed

(City of)
(1/5)
$14,854,000 of series

1953

inclusive.
ceeds—For

Price—To

be

and

B

to

to

11

a.m.

(CST)

on

Smith,

be

stock,

and

offered

a

in

to

warrant

units of
common

one

share of preferred and 10
Price—For units of de¬

stock.

preferred and class B stock, $65 per unit. Proceeds—For
working capital and other corporate purposes. Under¬

for

writer—For debentures and warrants, Stroud &

1972,

Philadelphia, Pa.

For stock units, none.
pected last week in January.

Pro¬

Saaty Fuel Injector Corp.
Dec.

(jointly); Kuhn, Loeb & Co.
Glore, Forgan & Co. (jointly); Lehman Brothers;
White, Weld & Co.; Smith, Barney & Co.; The First
Boston Corp. Bids—To be received on Jan. 5.

Co., Tampa, Fla.

(1/4)
50,000 shares of

common

Price—$5 per share.

Proceeds—For new
Office—215 Chapman St., Boston,

Saint Anne's Oil Production Co.

i

(1/4-8)

April 23 filed 160,000 shares of common stock (par $1).
$5 per share. Proceeds — To acquire stock of.

Price

of

if National Homemakers Finance Corp.
Dec. 21 (letter of notification) 1,800 shares of 7% cumu¬
lative preferred stock (par $100) and 1,800 shares of class

(letter of notification)

Co., Inc.,
Offering—Ex¬

plant and equipment.
Mass. Underwriter—d'Avigdor Co., New York.

Mutual Finance Co.,

Tampa, Fla. (1/4)
notification) $300,000 of 10-year 6%
convertible subordinated debentures, series A, due 1964.
Price—At par. Proceeds—For investment capital. Office
—Wallace S. Building, Tampa, Fla. Underwriter—Louis

3

stock (par $1).

and

C. McClure &

up

bentures and warrants, $1,000 per unit; and for units of

improvements, etc. United States Underwrit¬

(letter

common

shares of class B

Halsey, Stuart & Co. Inc.

24

received

be offered in vuni'ts of one $1,000
to purchase 100 shares; and
2,099 shares of 5'Vfe% cumulative preferred stock (par
$50) and 20,990 shares of class B common stock (par $1)

ers—To be determined by competitive bidding. Probable
bidders may include: Shields & Co., Savard & Hart and

Nov.

be

1966;
12-year warrants to purchase 100,000 shares of class

debenture

1953 deben¬

1, 1954 to Oct. 1,
supplied by amendment.

Bids—To

if Ritter Finance Co., Inc., Jenkintown, Pa.
24 filed $1,000,000 of 5V2% debentures due

Dec.

/

debentures

& Co., Inc.; Kuhn, Loeb & Co.; The First
Corp.; Glore, Forgan & Co.; Harriman Ripley &

Co. Inc.

100,000 shares of common
cent). Price—15 cents per share. Proceeds

local improvements and
$8,000,000 of series
tures for public works due Oct.

Blyth

Jan. 12, at the office of Sidney, Austin, Burgess &
II SovXa Salle St., Chicago 3, 111.

St., Detroit 26, Mich.

underwriter, I. J. Schenin Co., New York.

^

petitive bidding. Probable bidders: Halsey, Stuart & Co.
Boston

(jointly); Smith, Barney & Co.
Harriman Ripley & Co.
(jointly).
On June 15,
headed by Halsey, Stuart & Co. Inc., Har¬

one

(1/12)

1984.

Vine.;

(letter of notification)

(par

Indiana, Inc.

$25,000,000 first mortgage bonds, series K,
Proceeds—To repay bank loans and for new
construction. Underwriters—To be determined by com-

if Montex Oil & Gas Corp., Baytown, Tex.
Dec. 21

stock

filed

9

due

Ripley & Co. Inc., and Union Securities Corp. bid
100.125% for the issue as 5s. It was rejected. Bids—Ten¬
tatively expected to be received up to 10:30 a.m. (EST)

stock

(letter of notification)

Public Service Co. of
Dec.

Brothers

Jan. 20 at 415 Clifford

23

common

riman

on

Underwriter—Garrett & Co., Dallas, Texas.

1,000 shares of class B
(par $100). Price—$111 per share. Pro¬
ceeds—For working capital.
Office—1350 Woodswether
Road, Kansas City, Mo. Underwriter—None.

rig, etc.

and Blyth & Co., Inc.
(jointly);
Inc. and Union Securities Corp.
a group

Service, Inc., Dallas, Tex. (1/2)
(letter of notification) $100,000 of 6% convert¬

30

capital.

—

Lehman

Proceeds—To

if Professional Securities Corp., Kansas City, Mo.

due

and

amount.

ible debentures due 1963 to be offered first to
preferred
stockholders.
Price—At par.
Proceeds—For working

Corp., Orlean, N. Y.

To repay $20,000,000 3%% bank loan notes
July 30, 1954, issued to provide temporary financing
for additions to the company's
utility plant. Underwriters
—To be determined by competitive
bidding. Probable
bidders: Halsey, Stuart & Co. Inc.; White, Weld & Co.

principal

Petroleum

filed

Proceeds

of

Under¬
writer—Blyth & Co., Inc., New York and San Francisco.
Oct.

(1/20)
(by amendment) $20,000,000 first mort¬
bonds, dated Jan. 15, 1954 and due on Jan. 15, 1979.
28

Price—100%

retire bank loans and for capital expenditures.

Michigan Consolidated Gas Co.

gage

Nov.

and

common

Fergus Falls, Minn. (1/22)
28 filed $2,500,000 of 4%% convertible debentures
1, 1964, to be offered for subscription by com-*

held.
I

(1/12)

(letter of notification) 2,800 shares of common
Price—At par ($100 per share).
Proceeds—To

Montreal
«.

Coast

under¬

stockholders of record Jan. 22, 1954, on the basis
$100 of debentures for each 25 shares of stock then

of

Y.

Medina Oil

I.).

Oct. 27 filed 700,000 shares of convertible preferred

as

due Jan.

Inc., Chicago, 111., and New York,

of

stock, together with proceeds
sale of $200,000 of series A bonds, to be
bank loans and for construction program.

Underwriter—East

if Otter Tail Power Co.,

Price—To be supplied by amendment.
Proceeds—To
purchase two plants in Georgia and Ohio. Underwriter

1953,

^ar) to

City.

Corp., New York, has withdrawn

mon

Dec.

^General Telephone Co. of California (1/14)
Dec. 28 filed 150,000 shares of 5% cumulative preferred

St., New York

writer.

S. Macmillan (for
5,000 shares) and to Helen F. Mac¬
millan (for 8,500 shares).
Underwriter—Shearson, Hammill & Co., Los
Angeles, Calif.

—William R. Staats & Co., Los Angeles, Calif.

filed

Wall

R.

Bradford, Pa.
Haven, Pa.

7

52

Dec.

Corp., Ltd., Los Angeles, Calif.
100,000 shares of capital stock (par $2.50).
Price—To be supplied by amendment.
Proceeds—For
working capital. Business—Construction of plants for
the oil. gas. chemical and power industry.
Underwriter
Dec.

stock (par 10 cents) to be offered in units
preferred and three common shares. Price—$10
unit. Proceeds—For working capital, etc. Office—

Macmillan Petroleum Corp., Los
Angeles, Calif.
Dec. 22 (letter of
notification) 13,500 shares of common
stock (par 50 cents).
Price—At market.
Proceeds—To

Dec.

Miami, Fla.

one

per

filed

Dec. 15 filed 100,000 shares of

(letter of notification)

common

of

250,000 shares of capital stock. Price—At
market. Proceeds—For investment.
Sponsor—American
Trusteed Funds, Inc., New York.

ad¬

company.

Western

28

of

—

Neb-Tex Oil
•-

Co., to pay loans and for working capital.
Iowa. Underwriter—Sills, Fairmam

Office—Northwood,
&

Harris of Chicago, 111.
Snoose

Mining Co., Hailey, Idaho

(letter of notification) 1,000,000 shares of com¬
stock.
Price—At par (25 cents per share). Pro-

Oct. 30
mon

Continued

on

page

36

f

The Commercial and Financial Chronicle .%

I

(2660)

36

*Continued from page

Sdg.,

machinery and equipment. Underwriter—
E. W. McRoberts & Co., Twin Falls, Idaho.

shares of o%
Price—At par
($1 per share). Proceeds—For drilling and equipment.
Office—Capital National Bank Bldg., Austin, Tex. Under¬

of notification) 300,000
cumulative convertible preferred stock.
(letter

21

leases

5,000 shares of preferred stock (no
end 15,000 shares of common stock (par one cent)

par)
to be
offered in units of 25 shares of preferred and 75 shares
•of common stock. Price—$2,500 per unit. Proceeds—For
working capital, etc. Underwriter—None.
(1/4)

States Uranium Corp.

Three

(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.
13

Nov.

Junction, Colo. Underwriter
City, N. J.

Office—354 Main St., Grand
Tellier & Co., Jersey

if Title Insurance Corp. of St. Louis, Mo.
Dec. 21 (letter of notification)
4,250 shares of
stock. Price — At par ($25 per share). Proceeds

capital
For

—

St., St. Louis, Mo.

working capital. Office—810 Chestnut
Underwriter—None.

Triplex Corp. of America, Pueblo, Colo. (1/4)
16 (letter of notification) 75,776 shares of common

•

Dec.

(par $1), of which 21,661 shares are

stock

to be offered

payment of dividend arrearages on the preferred stock
the balance to be sold publicly.
Price—$2.40 per

in

and

Proceeds

share.

Underwriter

For working capital.

—

—

market

the

through secondary distributions). Proceeds
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
"basis of 6V2 shares of United Merchants stock for each
.Juilliard common or preferred share.
Underwriter —
Exchange
—To

a

or

group

Statement effective Oct. 26.

None.

•

Underwriter—None.
Co.

Wallace Container

Dec.

18

(letter of notification)

common

-—To

Price—At par

stock.

75,000 shares of class A
($4 per share). Proceeds

Office—5862-68 Croker Street,
Underwriters—The First California

expand facilitiees.

jjos Angeles, Calif.

Cbn Inc., Bateman, Eichler & Co. and Lester, Ryons &
Co., all of Los Angeles, Calif.
£r Ward Leonard Electric Co.
Dec. 24 (letter of notification) 5,000 shares of common
stock (par $4) to be offered for subscription by em¬
ployees.
Price—$10 per share.
Proceeds—For general
corporate purposes. Business—Electrical control devices.
Office.—115 MacQuesten Parkway South, Mount Ver-

N. Y.

pon,
"

West Coast Pipe Line Co.,

Dallas, Tex.

15,

and 580,000 shares of

1964,

one

share of stock. Price

ment.

Proceeds—From

—

sale

one

To

be

units

of

stock

common

•cents) to be offered in units of

American Louisiana Pipe Line Co.
Nov. 10 company, a subsidiary of American Natural Gas

Co., asked Federal Power Commission to authorize

con¬

struction

of a $130,000,000 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 of
common stock (par $100), the latter to be sold to parent.

(par

50

supplied by amend¬
and 1,125,000 addi¬

tional shares of common stock and private sale of $55,"000,000 first mortgage bonds to be used to build a 1,030
anile crude oil pipeline. Underwriters—White, Weld &
Co.

Vhion Securities Corp., both of New York. Of-

Electric Co.

President, announced that the com¬
and sell early in 1954 about $4,bonds and make an offering to stockhold¬

plans to

issue

new

l-for-10

on

raise

a

of

sufficient

estimated

common

Securities

Previous bond issue

stock

stock

common

Corp.

and Smith, Barney &
placed privately.

was

Baltimore & Ohio RR.
Nov. 9 it

was

bonds

due

Jan.

1, 1985 now held by the Recon¬
struction Finance Corporation. The latter in turn
plans
to offer the

new

bonds to

a

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
Central Maine
7

it

was

holdings of

Central

Maine

Power

Co.

common

stock.

Probable bidders: Blyth &
& Co.
(jointly); Coffin &

Co., Inc. and Kidder, Peabody
Burr, Inc.; A. C. Allyn & Co.,
Bear, Stearns & Co. (jointly); Harriman Ripley

& Co., Inc.

issue and sell

$6,000,000

Nov.

of

collateral

trust

bonds

due

1, 1978,
negotiated sale. Price—To be announced later.
repay
bank loans and for capital im¬

'

Pipe Line Co., Dallas, Tex.
Nov/20 filed 1,125,000 shares of common stock (par 50
cents).-Price—To be supplied by amendment. Proceeds
—Together With other funds, to be used to build pipe¬
White, Weld & Co. and Union Se¬
curities Corp., both of New York. Offering—Postponed
indefinitely.
—

fr Western Casualty & Surety Co.
Dec. ,29
to

be

about

•each

150,000 shares of

offered
Jan.
two

Western
•awns

filed

shares

of

it

very

Colorado Oil & Gas Co.

Nov.

12 it

was

(1/25)

reported company, a subsidiary of Colo¬
Co., plans issuance and sale of 1,000,-

rado Interstate Gas

•

stock.

common

development.

New York.

Proceeds—For exploration

Underwriter—Union Securities Corp.,

Registration—Expected

on

Jan. 5.

amendment.

stock

on

Securities

Co., the
presently outstanding

Proceeds

—

Northern Illinois Gas
Co., a subsidiary, was
incorporated in Illinois to acquire the gas properties of

Public

Service

Company

division.

This

unit

Feb.

1,

which

common

This is

a

working

capital,

per

share.

drilling




;

issue and

plans to

company

bidders:

able

Halsey,

&

Stuart &

Peabody

Kidder,

thers;

Inc.; Lehman

Co.

Bro¬

Lynch, Pierce,

Merrill

Securities

Union

and

Beane

Co.;

&

Corp.

(jointly).

Bids—Expected to be received on or about Feb. 17, 1954.
•

Gas

Service

Co., Kansas City, Mo.

Cities Service Co.

Dec. 11

was

authorized by the SEC to

1,500,000 shares of its holdings of Gas Service Co.
common
stock
through negotiated sale, rather than
sell

through competitive bidding. The highest bid ($32,000,000) is understood to have been made by Missouri Pub¬
lic
of

Service Co., subject to approval of the City Council
Kafosas City, Mo.

16 it

Dec.

Utilities

Public

announced

was

Corp.

company

plans to offer about

additional shares of common stock (par $5) to
or April, 1954 — probably on the

600,000

stockholders in March
basis of
To

be

one

share for each 15 shares held.

new

determined

Price-

just prior to the offering date.

ceeds—To be invested

in the domestic subsidiaries.

derwriter—None, but

Merrill Lynch, Pierce,

Beane may act as

it

Un¬

Fenner &

clearing agent.

reported

was

Pro¬

(4/6)
company

plans issuance and sale

of

$11,000,000 first mortgage bonds due 1984. Proceeds
—To repay bank loans and for construction program.
Underwriters—To be determined by competitive ;bidProbable bidders: Halsey, Stuart & Co. Inc.; Blyth
Co., Salomon Bros. & Hutzler and Shields & Co.

ding.
&

(jointly); Harriman Ripley & Co., Inc.; Union Securities
Corp. and Equitable Securities Corp. (jointly); The First

Corp.; Lehman Brothers; Morgan Stanley & Co.
for March 1. Bids—Expected to
on April 6.

Registration—Planned
be

received

if Hempstead Bank, Hempstead, N. Y.
18 stockholders approved plan of merger into this

Dec.

of Bank of Syosset, L.-.I., N. Y., which will in¬

company

volve the issuance of
stead

Bank

offered

of $10

12,000 additional shares of Hemp¬
value. Unexchanged shares will

par

publicly.

Price

—

$31.25

per

share. Under¬
Offering—

Expected in January.

if Houston National Bank, Houston, Tex. (1/12)
was announced Bank, following proposed twofor-one stock split-up, plans to offer its stockholders
Dec. 21 it

a one-for-two
Proceeds—To in¬

Price—At par

capital.

changing the authorized capital stock from 50,000
(par $20) to 150,000 shares (par $10).

on

Office

-r-

Meeting

Power

Pro¬

301; Kittredge

per

—

share).

Stockholders

will

on

Jan. 12

Co.

that

this

company

finance construction

plans

to

raise

$184,550,000

three hydro-electric projects

of

Snake River, Idaho.

obviously, a combination of tortoise and hare
a good
example of how Sorg works. We
we have to be
thorough because
clients must have quality, whatever the deadline.

of

If approved, the financing will

$105,000,000 of bonds through 1962; $27,400,000
preferred stock; 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.

borrow and repay

Specialists in all types of financial, corporate and
legal printing, Sorg has had "over 30 years' experi¬
in handling the whole job...from design
through composition, printing, binding, mailing.

Dec. 10 it

of

International

a

day in the interests of

producing fine, accurate printing with, when neces¬
speed.

sary, utmost

Bank

for

Reconstruction

and

("World Bank")
(1/12)
announced bank plans to offer $100,000,000

Development

ence

was

15-year

bonds due Jan.

First Boston

1,

1969.

Underwriters—The

Corp. and Morgan Stanley & Co., both of

New York.

Jersey Central Power & Light Co.
1

CONMDiNTUL

SINCf

common

($10

Throughout the

our

common

Price-^5V2 cents per share!

expenses.

.

writer—To be determined by

have to be fast and

Proceeds—To

Wyoming Oil Co., Denver, Colo.
Nov. 3 (letter of notification) 5,000,000 shares of
For

■

$5,000,000 of 30-year first mortgage bonds. Under¬
competitive bidding. Prob¬

sell

and also

Underwriter—Graham, Ross & Co., New

•stock (par five cents).

announced

was

>

(2/17)

consist of

.'>-41

JHVIC!

—

it

14

Dec.

on

York.

ceeds

"

Electric Co.

Essex County

to

working capital, to acquire
Office—812 Eccles Bldg., Ogden,
Samuel B. Franklin & Co., Los

Price—2.12V2

and for general corporate pur¬

poses.

We're available 24 hours

—

Proceeds—To retire debt, to in¬

(about $20 per share).
working capital

crease

mission

additional

Wilson Organic Chemicals, Inc. (N. J.)
Dec. 14 (letter of notification) 15,000 shares of

(par $1).

Jan. 18 vote on a proposal to increase

on

ized capital

Co., New York, testified before the Federal Power Com¬

etc.

Angeles, Calif.

♦stock

will

Aug. 6, officials of Blyth & Co., Inc. and Bankers Trust

....

underwriter.

oversubscription privilege). Stockholders
the author¬
stock (par $1) from 3,000,000 shares to 5,000,shares.
Price —To be below the present market

stock (with an

Idaho

stock,

(letter of notification) 3,000,000 shares of com¬
stock
(par 10 cents). Price—5 cents per share.

Underwriter

plans to offer to its

subscribe for additional capital

stockholders the right to

1954.

parent,

Western Empire Petroleum Co.,
Ogden, Utah

leases, drill well, etc.

.

•

it Was announced company

29

Dec.

shares

•Oct. 22

Utah.

„

A Delhi Oil Corp.

vote

Scott, Kansas. Underwriters—Kidder, Peabody & Co., New York, and Prescott, Wright, Snider Co.,
.Kansas City, Mo.

Proceeds —For

Corp.; Lehman Brothers; Morgan Stanley & Co.;
Kuhn, Loeb & Co. and Salomon Bros. &Hutzler (jointly);*
W. C. Langley & Co.
• / .

crease

Office—Fort

mon

Co., Inc. (jointly); White,
(jointly); Union Securi¬

&

Weld & Co. and Shields & Co.

basis.

(par $5)

Price—To be supplied

For

and

50,000 additional shares of capital stock on

held; rights to expire

the

Corp.

writer—Francis I. duPont & Co., New York.

25

Edison's

Blyth

be

Commonwealth Edison Co.

Nov.

Halsey, Stuart & Co. Inc.; The First

Boston

Boston

was
reported that corporation is a prospect
substantial emission of debt capital.

(1/19)

common

will not subscribe for any stock.

*)y

•

23

a

Probable bidders:

to

for subscription by stockholders on or
1954, on the basis of one new share for

19,

Insurance

92%

ICC

Chrysler Corp.
Dec.

and

West Coast

line. Underwriters

Bids—Halsey, Stuart & Co. Inc.

on Dec. 14
reject company's request and that bonds
be first offered at competitive
bidding.

for

and sell

of first mortgage and collateral
trust bonds.
Proceeds—For construction program.
Un¬
derwriters—To be determined by competitive bidding.
in 1954 about $10,000,000

Dec. 15

Dec. 3 company sought ICC
permission to

asked

Light Co.

Power &

Georgia Power Co.

Chicago Great Western Ry.

a

Oil Co.

announced company plans to issue

was

Geheral

Power Co.

reported company plans sale during the
first quarter of 1954 of
$10,000,000 common stock after
distribution by New England Public Service Co. of its

Inc. and

& Co*

was

Delaware

Fenner

reported company 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

Oct.

it

Oct. 5 it

to

$3,000,000. Proceeds—For

Underwriters—For

program.

be Union

may

Co.

basis

additional

an

construction

000 shares of

itering-ffPostponed indefinitely.

Putnam

reported that this company is expected to
be in the market for new capital.

000

Atlantic City

Oct. 5 B. L. England,

provements.

$50 debenture and

of bonds

ties

March 16.

Proceeds—To

Nov. 20 filed $29,000,000 12-year 6% debentures due Dec.

reported company plans to raise between

was

$10,000,000 and $20,000,000 in 1954 from sale
stock.
Underwriters—For common stock:

Dec. 23

is

company

& Co. Inc. and Kidder, Peabody & Co. (jointly); Morgan
Stanley & Co.; Lehman Brothers; The First Boston Corp.;
Harriman Ripley & Co., Inc. Registration — Tentatively
scheduled for Feb. 8.
Bids—Expected to be opened on

through

Underwriter—None.

it

7

Continental

(3/16)

reported

offer the bonds to the public.

(1/6)

Power Co.

Connecticut Light &
Dec.

—

Co.; Chas. W. Scranton & Co., and Estabrook
Bonds may be placed privately.

planning issuance
and sale of $17,000,000 first mortgage bonds due 1984.
Proceeds—For construction program.
Underwriters—To
be determined by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Union Securities Corp., Equit¬
able Securities Corp. and Drexel & Co. (jointly); Blyth

trust

^United Wholesale Druggists, Inc., Eastport, Ga.
Dec.-"21 (letter of notification) 6,608 shares of preferred
stock. Price—At par ($25 per share). Proceeds—For in¬
ventory and working capital. Office — 1120 Oakleigh
Drive, Eastport, Ga.

Power Co.

was

ers

shares of common stock (par $1).
(either ,on the New York Stock

574,321

filed

7

.price—At

it

15

000,000 of

United Merchants & Manufacturers, Inc.

Oct.

Alabama

Dec.

pany

Seattle, Wash.

John R. Lewis, Inc.,

worked out by

The First Boston Corp.,
Halsey, Stuart & Co. Inc., and Glore, Forgan & Co.
early February. Underwriters

&

Prospective Offerings

filed

10

of mortgage bonds

$60,000,000

and

N. Y. City

Inc.,

2QOf

Theatre

supplied by amendment.
Proceeds—To pay for
drilling.
Business—Oil and gas exploration.
Ss-<
;V

and

Underwriter—None.

writer—None.

Dec.

sell

issue and

plans to

early in 1954. Financing expected to be

Dec. 7 filed 300,000
—To be

Oil Development Corp.

jr Texas-Louisiana

Robert W. Wilson,

—

Wyoming Oil & Exploration Co., Las Vegas, Nev.
shares of capital stock (par $1. Price

ceeds—For

Dec.

Underwriter

Denver, Colo.
Denver, Colo.

35

Thursday, December 31, 1933

.

i

'

WJ0

Dec.

issue
i-

~

PfUi
nw

-

16

it

and

bonds due

reported

was

sell

in

1984."

1954

company

about

Proceeds

—

tentatively plans to
first mortgage

$6,000,000

For construction- program.

'•
_

gg CM

Underwriters

—

To

be determined

by competitive bid¬

ding. Probable, bidders: Halsey, Stuart & Co. Inc.; White,
Weld

&

Co.;' Glore, Forgan & Co.; Kidder, Peabody &

Number 5286

Volume 178

...

The Commercial and Financial Chronicle

North

Securities Corp., Salomon Bros. & Hutzler
Lynch, Pierce, Fenner & Beane (jointly);
The First Boston Corp.; Lehman Brothers.
Co.; Union

Dec.

Merrill

.and

-Louisville Gas
Dec. 16 it

Electric Co.

&

defer

(2/16)

of

by competitive bidding. Probable bidders: Halsey, Stuart
Co.

Inc.; Kidder, Peabody & Co.; Lehman Brothers
Blyth & Co., Inc. (jointly); Kuhn, Loeb & Co.; Glore,
Forgan & Co.; The First Boston Corp.; Harriman Ripley

and

<&

Feb.

on

16.

Inc.; White, Weld & Co.; Kidder, Peabody & Co.
(jointly); Kuhn, Loeb & Co. and Salo¬
(jointly).

Bros. & Hutzler

v.C- Missouri Pacific RR.

July 2 it

Mo.,

sell

its

to

share.

Halsey, Stuart & Co. Inc.; Salomon Bros.

<& Hutzler. J; *;

None.

28

it

Public

announced

was

$14,000,000 of

Co.

Service

plans to

company

issue

American

91.25%

bentures to

retire the bank

ssell

Underwriter

it

14

announced

was

plans to issue

it

may

issue and

and

$5,500,000 of 20-year first mortgage bonds. Under-

Oct.

Beane

it

Colo.

fissue and sale in

tfoonds due 1984.

Proceeds—To repay bank loans and for
Underwriters—To be determined by

construction.

mew

competitive

bidding. Probable bidders: Halsey, Stuart
Co. Inc.; Kuhn, Loeb & Co. and Lehman Brothers
<jointly); Equitable Securities Corp.; Union Securities
*€orp. and White, Weld & Co. (jointly); Merrill Lynch,
EPierce, Fenner & Beane.

Underwriters—To be

bidding.

reported this company tentatively plans
1954 of about $3,000,000 first mortgage

was

\

Fenner

from

page

determined

•

an

5

former

"liberal" planners

Fair

Dealers,

as

Dr.

and
Ger¬

Anti-Depression

the
to

practical
^success

?to

importance
the

at

attached to
and

election polls,

"what it takes."
This

situation

is

perhaps best
•^epitomized in the person of Sena¬
tor Paul

as

tion

and

Illinois

Economic

Democratic

soon

up

Associa¬

Senator

of

for reelection; and

Dr. Gabriel Hauge, economist and

"•writer, who is presently laboring
;as

"Economic

Assistant

to

the

confidence
decision

in
not

neglect the pump-priming path.

Horror About

eral

Planning

In line with the pump-priming-

in-the-closet
dote

as
depression anti¬
policy recently disclosed by

debt

that

No

has

political
the

limit

is

matter

enmeshed

considerations

The

the Fed¬

another

become

academicians,

here.

on

it

executive

is

even

in

by

session

of

a

approximately

to

emphasize

awareness

his

of the

politi¬

cal

embarassment

clude

publication of
Debating the economic situation
before the annual gathering of alleged necessity for "un-Hoover- expected resolution.
like" stepping-in. "Fundamentally,
the American Statistical Associa¬

should
a

pre¬

normally-

our
determination, with all the
tion, the American Economic As¬
resources
at our command, is to
sociation, and 11 top-flight allied
see to it that this kind of an ad¬
professional organizations, Doctor
justment does not get to the point
.Senator Douglas sailed in on De¬
that you
talked about, a chain
pression do-nothing-ism and Dr.
reaction, where it catches fire and
"Hauge definitely accepted the role
accumulates," protested Dr. Hauge
«of the defensive.

Mr.

(who works for

Douglas is chief protagonist

an

Administration

on a platform
and to restore
sound money, free prices, and free
cisively, confusedly, and ideologi¬ trade). Discussing
monetary pol¬
cally, letting "the" (rather than
icy, this economist-with-the-govThe seasoned investment mar¬
""a
possible")
current recession ernment quite significantly stated
ket rounded out the current year
""slide" intola full-fledged depres¬
that it would be "conducted in
with an air of bouyancy that was
sion. Importantly, Dr. Hauge af¬
such a way as not to be a drag
rather
firmed vigorously, not only the
surprising to many ob¬
upon
the full utilization of our
^helpfulness of such imminent steps resources in the year ahead," and, servers. With major institutional
investors literally out of business
^as tax reform; but most vigorously
sharing prevalent worry over pros¬
^denied that current statistics by
during this customary inventory
pective "deflation" (midst a $67
Douglas manifest anything more billion budget), emphasized to his period there was no little scurry¬
than a slight "cyclical" recession.
around
to
determine
the
audience that the Reserve Board ing
source of the buying orders which
Included in the descent from last June promised that it would
stiffened prices.
the academic stratosphere to the maintain a money supply large
This demand was not limited to
political gutter, has been squab¬ enough to sustain high levels of
the Treasury list but spread out
bling over unemployment, present employment and output.
It seems highly significant, not to embrace top-grade corporate
«nd future, extending even to the

bere

of

those

who

charging
that "the Republicans" are inde¬
are




presumably elected

to

stop

planning,

to

of

be

debentures.

determined

by

.

Salomon

Bros.

&

Hutzler.

fering (in 1952)
underwriting.

the

True,

as

made

was

to

lack

stockholders,

the vernacular.

of¬

without:
;

-

of

into the

came

stock

common

;

be put to work at
use

Previous

Clean

Slate

One

thing is
firmness
nothing in the

price

the

"uptick" to

left

of

1954 -4*

;

There

1st

of inventory

way

from

over

for

certain.

undertakings
two months to em¬
underwriters as they re¬

the

new

past

barrass

Among those who attempted to proach the resumption of normal
ferret out the nature of the week's

buying operations, it
dealer

in

the

was

that the bulk of it

sensus

accounts

and

con¬

for

was

business

a

fortnight hence.

*

Judging from reports of clearing
away
of all remnants, it is ap¬

anticipatory parent that the rank and file have

nature, based on expectations their capital free and clear andi
the tapering off in demand
ready for whatever business lobnnfc<

that

bank

for

next
cial

will

loans

of income

in

letdown

who

probably

will

the first five

months of 1954

were

acquiring

the

to

be

a

six

or

in the market

would

short

In

lieved

find

he

they

were

building

be¬

With

tion
new

Some People

the

See It

to

people

of
long experience in the investment
field

feeling

is

that

among

the

months

ahead

loans

of

commerce

and

off, the pressure
seeking employment is

industry

tapers

funds

bound

from

to

reflection

find

investment

market.

Such

in

the

a

de¬

to .flo ^ome ; re¬
satisfactory^ basis.

a

Up

the

filing

Roster

Michigan

by

of hegistra-

to cover some $20,000,000 of
25-year first mortgage bonds,
calendar

of

for

January.

Consolidated

New

York

has

Edfron

$35,000,< 90

first and refunders due

fining
year

Jan.

on

Co.

6

and

has

same

on

Meantime

W.

President,

says

California

Ediscm

De¬

of JL5-

the

day.

far

up

Atlantic

$55,000,000

debentures due

ket the

begins

up.

Already
Co.
of

bank

the

build

probably will see a trend toward
bids
higher prices and lower yields for

gilt-edge corporate paper.
They reason that as demand for

on

Consolidated Gas Co.

against anticipated future demand.
As

possible

Building

to

appeal

it

financing

inventory

The

ma&kt soften

felt

type of bonds that

calculated

banks.

'..^it-

.nv

Should the money

up sufficiently there is th6; pos¬
sibility that in addition tpgfinanc¬
ing contemplated to pay >for ex~
commercial
pansion, some borrowers plight

dealers

factor through

they

early ahead.

to offset this loss

through investment.

Accordingly,
the

reflect

in efforts by commer¬

year

institutions

that

on

$15,000,000

debentures

bidding. Probable bidders: Halsey, Stuart
Inc.; White, Weld & Co. and Stone & Webster
Securities Corp. (jointly; Union Securities
Corp.
Smith, Barney & Co. (jointly); Lehman Brothers and
Bear, Stearns & Co. (jointly); The First Boston Coi
and Blyth & Co., Inc.
(jointly); Kidder, Peabody & Co.;

borrowing

called

For

—

Co.

&

for

Council of Economic Advisers

Administration's

reported company plans to offer in March,
shares of common stock and in

was

1954,

market had to

revealed

rock-ribbed hard money commit¬
(as tee
convening here yesterday be¬
at the American Assembly at Har¬
came
heatedly
and
hopelessly
riman, N. Y.), Dr. Hauge here has deadlocked over whether

-

competitive

well.

Chairman Arthur R. Burns of the

felt

President."

their

Congressional ceiling

former President of

American

affirm

Administration's

questioning of statistics including
Presumably, such has political as
Douglas-Hauge charges and coun¬ w§ll as
purist-academic coloration.
tercharges of error of as high as
The question of attitude on the
1,000,000 in the estimates.

H. Douglas, who is dou¬

bling here
^the

to

on

Lynch, Pierce,

Light Co.

May,

as

Merrill

Securities Corp. (jointly).
expected to be received on or about

supply contributed no small bit to

an

Co.;

Union

200,000

making

governmental

intervention, but that so many of
their relatively "free
market"
brethren, in agreement, felt called

Economists

and

about

since such funds

for

v

.

Underwriters

to obtain

issues

Price—

plans to issue and

company

1954,

the

need

Beane

Utah Power &

hard Colm, expressed concern over

dire

&

Dec. 23 it

early

by competitive

for the company

shares owned.

(3/3)

announced

was

Bids—Tentatively

1 Southern California Edison Co.
Dec. 30, W. C. Mullendore, President, announced that it

that other

Continued

it

thers; Kidder, Peabody &

Halsey, Stuart & Co. Inc.;
Kuhn, Loeb & Co.; The First Boston Corp.; Harris, Hall
& Co. Inc.; Harriman Ripley & Co., Inc. and Union Securities Corp. (jointly); Lehman
Brothers; Kidder, Pea¬
body & Co.; Blyth & Co., Inc. and Smith, Barney & Co.
(jointly).

necessary

14

March 3.

is planning to float

six

$4,000,000 of 30-year first mortgage bonds. Under¬
writer—To be determined by competitive
bidding. Prob¬
able bidders: Halsey, Stuart & Co.
Inc.; Lehman Bro¬

Probable bidders:

probably will be

for each

Proceeds—For improvement arid modern¬

sell

Proceeds—For financing, in part, a $17,000,000 electric generating plant to be constructed in
Denver,

New Jersey Power & Light Co.
16

company

issue of $15,000,000 first mortgage bonds, due 1984,

Securities

Corp. (jointly). Bids—
"Tentatively expected to be received on or about Feb. 10.

SDec.

reported

was

share.

Suburban Electric Co.
Dec.

next year.

Union

and

13 it

share

new

per

ization program.

Public Service Co. of Colorado

Inc.; Kidder, Peabody
Co.; Lehman Brothers; Merrill Lynch, Pierce, Fenner

28,484 additional shares of capital stock (no par),
31, 1953, on the basis

one

$15

by competitive bidding. Probable bid¬
Halsey, Stuart & Co. Inc.; Equitable Securities
Corp.; Kidder, Peabody & Co., Merrill Lynch, Pierce,
Fenner & Beane, Union Securities Corp. and
White,
Weld & Co.
(jointly); Harriman Ripley & Co., Inc.;
Kuhn, Loeb & Co., Lehman Brothers, Drexel & Co. and
Salomon Bros. & Hutzler (jonitly); The First Boston
Corp. Offering—Expected in March or April, 1954.

-writer—To be determined by competitive bidding. Prob¬

•;

reported that company

was

1954.

its stockholders of record Dec.

of

ders:

able bidders: Halsey, Stuart & Co.
«&

offer
to

To be determined

(2/10)
company

Telephone

of Pacific's

about $12,500,000 of first mortgage bonds due 1984.
Proceeds—For
construction program.
Underwriters—

For

—

16

Dillon, Read & Co. Inc.,New York who also han¬
sale of; $12,000,000 in bonds, in February,
Offering—Of stock is expected late in January or

★ Spokane International RR. Co.
v* *)
Dec; 29, F. C.
Rummel, President, announced-company
is filing an application with the ICC for
permission; to

sell

Kidder, Peabody & Co.

Mystic Valley Gas Co.
IDec.

loans.

Dec.

reported company plans to issue and sell
stockholders on a l-for-14 basis about

public

1953.

Pennsylvania Electric Co.

common

was

early February,

on a

and

stock and borrow $18,000,000
from banks in connection with proposed acquisition of
1,500,000 shares of common stock of Gas Service Co. of
Kansas City, Mo., at a total cost of $32,000,000. Follow¬
ing consummation of proposed merger of the two com¬
panies, it is planned to sell $18,000,000 in bonds and de¬

sstock:

dled

and

& Telegraph Co., parent,
outstanding stock. Offering—
Not expected until the early part of 1954.

';.

owns

Missouri

it

272,000 additional shares of common stock (with a 14day standby); also $12,000,000 of first mortgage bonds
(which may be placed privately).
Underwriters—For

1,004,603
shares of
l-for-7 basis. Price—At par (100 per
Proceeds—To repay bank loans.
Underwriter—

able

bidders:

issue

reported company may issue and sell in

was

common

stock:

plans to
additional

company

stockholders

capital stock

1

its

to

Telegraph Co.

announced

was

it

Southwestern Public Service Co.
Dec.

Underwriters—To

/»

Pacific Telephone &

8

March, 1954, about $20,000,000 of first mortgage bond*.
Underwriters—To be determined by competitive
bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; The First
Boston Corp.; Blyth &
Co., Inc., and Kidder, Peabody &
Co. (jointly).

competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.; The First
Boston Corp.
Offering—Expected about the middle of

up to noon (CST), on Jan. 7 for the purchase from it of
."$3,000,000 equipment trust certificates, series WW. Prob¬

Dec.

Southern Natural Gas Co.
Dec.

be determined by

'February, 1954.

bidders for

new first and
refunding mortgage
bonds, series F, may include: Halsey, Stuart & Co.
Inc.;
Blyth & Co., Inc.; The First Boston Corp. and Harris.
Hall & Co. Inc.
(jointly); Kuhn, Loeb & Co. Probable
bidders for common stock
may include:
Blyth & Co.,
Inc.; The First Boston Corp.

Black, President, announced that company
and sell a presently undetermined
refunding mortgage bonds, series W.
construction program.

$50,000,000 from the sale of addition-!
1954, the type of which is not now known.

securities in

Probable

issue

to

Proceeds—For

(1/7)

Bids will be received by the company at St. Louis,

:sell

to

amount of first and

and Drexel & Co.
mon

16 J. B.

expects

reported company may sell in 1954 about

was

$3,500,000 first mortgage bonds due 1984. Proceeds—For
Underwriters—To be determined
Sby competitive bidding. Probable bidders: Halsey, Stuart
Co.

decided

Pacific Gas & Electric Co.

construction program.
&

been

about

Dec.

37

approximately
has

See Commonwealth Edison Co. above.

Metropolitan Edison Co.
Dec. 16 it

it

Northern Illinois Gas Co.

Bids—Tentatively expected to be received

Co., Inc.

that

a

$3,000,000 of first mortgage bonds had been
planned. Underwriter—To be determined by competi¬
tive bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Lehman
Brothers; Kidder, Peabody & Co.; Merrill
Lynch, Pierce, Fenner & Beane and Union Securities
Corp. (jointly).

000,000 first mortgage bonds due 1984. Proceeds — For
construction program. Underwriters—To be determined
&

(Mass.)

announced

was

bond issue by this company for at least several
months. It had been reported that the issuance and sale

reported company may issue and sell $12,-

was

Shore Gas Co.
it

14

(2661)

mar¬

.v-

C.

Mullendore,

that

Southern

Co., which has

is argued, could done extensive financing for con¬
effect, to lift prices struction, probably will seek to
and, accordingly, lower yields.
obtain
about
$50,000,000
mo e
Some go so far as to predict
from new securities in the year
that Triple A bonds, now on a
velopment,

have

only

it

one

3.05% to 3.20% yield basis could
ahead to levels where the
yields would range from 2.90% to
push

3.05% with Double A ratings mov¬
ing

up

level to

from
a

a

3.20%

to

.

Gustave E.
Gustave

3.25% McKelvy

3.10% to 3.15% basis.

/

ahead.

E.

&

May,
Co.

<r .,«■

May

of

passed away Dec. 21st.

partner

--

in

Pittsburgh,

38

The Commercial and Financial Chronicle

(2662)

Continued

from

worthiness

14

page

Such
would

community,

A More Varied Pattern in
provisions and "a progressive, vig¬
and consistent relaxation of

orous

foreign trade legis¬
Canadians will

its restrictive

lation."

To

this

<

Amen, and add a fervent
that these and similar au¬
thoritative recommendations will
say

of

ber

pacity

the

tion

demands

mindful of Canada's own respon¬

and

sibilities. Unlike the United States

managers

not

a
great creditor na¬
imports of goods and
services have usually equaled, and
are

are

the

of

sense

here

of

daily confronted with the re¬

time,

of

large

borrowers

of

world, and

rest

done

the

great deal, I consider, to¬
providing a receptive mar¬
for the products of other na¬
a

wards

assistance

financing

the

does

of

include

not

where

projects

basic fundamentals of

own

our

of

assured

other

in

parts

friends

our

warm

a

whenever and wherever

credit¬

a

problems with

encountered

of the

somewhat

is

be able

experience to

some

tive"

have

year

all

and

exchange views and to compare

small. Our definition of "construc¬

this

indeed

them

trade.-It

those

and

a

opportunities

the

and

international

exceeded, our exports. Canada has

ket

first

Our

quests

may

they

may

am

confident that
end

this

to

efforts

our

will

visit

But

must do

we

continue

as

they

good

Canada"

matter

a

to

be,

trade

governmental

of

than

policy. It is a charge on Canadians
in general, and on labor and man¬

alike, to improve effi¬
and to exercise modera¬
and
restraint in wage and

agement
ciency
tion

It is clear that in

price demands.

the endeavor to maintain and ex¬

pand markets, both abroad and
home, the test will be the price

at

tag.

ticular

and

its

At

nomic

this

dangerous

fallacy is tied in with

thing in the long

ex¬

reduce

taxes,
Yet I

in Brief

and

balance the budget.

to

can¬

not

for

moment

a

President

discard

believe

Eisenhower

these

with

ments

Canadian bank to say some¬

a

were

if

abandon,

not

commit¬

the

full

brouglj| home to him

they rest upon an economic
fallacy. Unhappily, the difficulty
goes
deeper than mere political
commitments.
lief is

The

considerations,
the propositions which f shall ad¬
this

in

vance

discussion

are

as

follows:
'

(1) Due to increases in national

needed,

The business
and

he

of lending

money

getting it back, always

down

thought

he

his

country

instead

was

statement

im¬ requirements

an

the

to

scaling

of

the

at

must

bank's activi¬

a

time

same

keep

our

primary responsibility to our de¬

ideas

own

defense

conform

all
in

defense burden.

It is stronger al¬

burden.

(2) The nation

has the

now

eco¬

nomic potential, without excessive
strain or undue controls, to lift
its

annual

rapidly

more

in

^ear

output

defense

than

by

year,

increases

any

outlays

by

proposed

any
responsible experts in this
field.
Consequently, the nation is

able

insofar

—

security

as

needs

dictate—to undertake any respon¬

sibly
and

proposed
the

at

defense

program,

time

same

further

to

increase its economic strength. It
follows inescapably from this that
the size and

shape of the national
program should
be de¬

security

his

to

tration

bank

the

that,

for

reasons

of

profit,

embarked upon a wide-open credit

is

cause

policy without due regard to the
nature of
soon

the risks involved, would

find itself, along with its de¬

positors, in

unenviable

a very

sition, to put it mildly.
duty of
be

bank,

a

as

that

function
tioned

can

of

perform

the

providing

safety

for

strong
dual

and

would

ers.

I

that

"constructive"

quires
mate

today

go

an

further and

say

assistance

especially

re¬

inti¬

knowledge of the borrower's

position.

In

a

period of rapid bus¬

iness

expansion such

been

experiencing,

ways more

as

there

we

than the normal




have

are

al¬

num¬

parts of

for

excuse

them

in mid-1950 there

be¬

now,
were

only

the American economy, while
today the few who foresaw it have

vindicated

actual

by

devel¬

I

emphasize this

because

we

example

only

should all realize that

arriving at the best attainable
with respect to

our

an¬

national

security

policies, which can be
done only in the context of sound
economic

yield the same amount of rev¬
think that it might be more
a while to leave taxes

practical for

they

if defense outlays
are lifted, instead of getting into
a
long tangle about taxes which
might distract us from more press¬
as

are now

ing and vital problems.
On

the

outlays

other

get

the

a

nation.

If

we

best

tax

revenues

mote

the

continuous

the

economy,

.

instead

growth of
of public

spending being adjusted to current
and

foreseeable

or

desirable

tax

Although under condi¬

revenues.

tions

of
and

sustained
full

should be

our

full

employ¬

production—which

predominant objec¬

tive of national economic policy—
the ideal situation is a balanced

budget,

it

would

be

unwise

to

attempt to achieve a' balanced
budget with undue rapidity either
lays
to

or

be

reducing necessary out¬
through the imposition of
a

size

inimical

character likely
to maximum eco¬

or

nomic stability and growth—such

that

level.

spite

American

some

ups

economy,

and

downs,

de¬
will

continue its timeless progress. But
if we get the worst possible an¬
swer

on

this

question,

or

even

a

is

despite the huge diversion of a
large part of the nation's produc¬
tive

great expansion of con¬
to avert a substantial

recession

it

next

If

year.

the trend of defense

be

be desirable

would

ahead with the
scheduled

to

reductions

tax

for

next

al¬

year,

though it would be preferable to
weight these reductions more
heavily in favor of lower income
groups to stimulate consumption.
economic recession
should become imminent, it would
general

a

be

desirable, in addition, further
lighten the tax burden, espe¬
cially on low income groups, to
to

stimulate consumption.

wouia

est

as

widespread sales taxes at
It

would

attainable

spending
clude

an

seem

that

the

any

best

tax policy, if defense
should be raised to in¬

adequate system of

con¬

an

grounds,

deficits

with

on

the larg¬

even

which

purely

might

result

without

or

than

security
been

in

defense

would

program

omy if full
duction
are

maintained;

would be far better to
of

this

size

mid-1950.

stead of
needs.

to

econ¬

it

and

run

to

than

pro¬

economic

at

creased

a

strength

defense

Moreover,

in¬

it

arguable

is

two,

year or

reduction in expenditures or an

reducing
would

economic

harm

size

of

sion

of the

mid-1950,

growth

than

defense program since

annual

our

between 1950 and

impede

do

more

are

some

significant recessionary forces now
at work. In other words, a moder¬
ate

deficit

the

for

next

or

year

two

might be economically desir¬
on
balance to .promote full
employment of our resources and
able

stimulate

economic

growth.

The Central Purpose of

greatly

program
to

base

this

true,

be

quickened

and

of

our

only

that

is stronger to¬
day than it would have been today
defense outlays had remained

if

at the mid-1950 level.

argument that

an

defense
the

or

best

It is true that the nation under¬
went

those who

came

mained

in

&y

But

many.

pray.

to

tojscoff have

re¬

Measured in uniform prices, our

total gross national
was

-$300

at

billion

of close to $375

of

annual

about
rate

enormously

ment

first

art

of

in

in

about

in

resulting from the

T^tal

State

govern¬

the

Jind

safne

prices, have risen from
of

our

has

rise

purchases of gooSs and

measured

This

now.

billion

of

rate

production

program.

ices—Federal,

rate

half

annual

billipn
$75

about

of

exceeded the

public outlays
defense

rale

the

in

;1950, has -risen to
gain

product, which

annual

an

period

a

in late

haps

1950

$45

of

and

rapid

inflation

early d951. Per¬

different types of programs
contained this infla¬

might have
tion

better

months
is

of

during

the

the

defense

early

program.

looking at the economy as it
hardly anybody can be

now,

found who will say that the spurt
of inflation did us harm compa¬
rable

to

gains

registered

In

the

economic

enormous

event,

any

that

full

since

mid-1950.

have had

we

employment

production
tionary.

re¬

a

If

should

we*

new

rapid

spurt in
in

and

by

calling for

our

defense

as

ef¬

the

building of our
productive facilities as took place

shortly after the Korean outbreak,
we

would have to find better ways

of

checking price

increases

did at that time.

no

to

reason

maintenance
full

and

But

suppose

of

full

production

than

there is

that

the

employment

during

.the

next few years, which means con¬
tinuous expansion as technology
and

population

increase,

would

have substantial inflationary con¬

measured

sequences

real economic

be

gains,

if there

substantial

a

the

against
even

but

not

extreme increase in the defense

Therefore, the most
of

all

economic

we

should

and

ahead bend every

ergy toward

un¬

propo¬

now

en¬

maintaining full em¬
production.;

ployment and full
a

Without the forced pressures of
full war economy, and without

the

use

the

resources,

of direct controls,

we

have

the technology and
business brains and

science, the
labor skills, and the growing pop¬
ulation, to lift the annual rate of
our

national product from the cur¬

rent level

of about

$375 billion to

close to $500 billion

by l£-30. It is
perfectly palpable that, if we suc¬
ceed

fairly well in this effort,

economy
year

by

ments
lead

of

us

even

national

to

our

grow much stronger

can

year,

if the require¬

security should

increased

defense

out¬

lays by the highest amounts pro¬
posed by any responsible experts.

Indeed,

the

fact

that

our

pro¬

annual

ductive potential at an annual rate
is due to increase by close to $125

in

that

uniform

an

billion

serv¬

local—

full

infla¬

confronted

be

emergency,
a

forts

and

necessarily

are

in the years
us

alUout program

heresy

eco¬

realistic

a

appreciation of what has actually
happened.

sitions is that

way

as

to facilitate

nomic growth, but it is

program.

to meet a rapidly
increasing defense burden was re¬
garded

This is not

expansion of
the only way

an

is

way

assailable

expanding production would be

the

outlays
best

Productive

by some of

an

follows

American economy

an

-

Economic Growth

mid-1950

If

economy.

it not

Employment

Full

Promote

The assertion

our

expand the whole pro¬

ductive

should

Economic Policy Should Be to
Maintain

production
purposes
would have

now

averaged lower than has actually
been the case, since the defense

we

to

as

deficit

so

There

good.

.

available for non-defense

toward

the

balance

net

on

aimed

taxes

the

in¬

program.

In fact, it may well be
argued
that, if there had been no expan¬

ex¬

collections

tax

that, during the next
in

has

heartening rate,

very

despite the

defi¬

a

tailor

tailoring them to national

increase

not

expansion
of
our
productive facilities. On all scores,

our

a

penditures

more

markably stable price level since
early 1951," thus refuting the idea
be held
by many a few years ago

not

employment and

cit

pur¬

far

expanded

an

substantially injurious to the

of

has

enormous-

from the current levels of taxation

to

there

only for consumption but also for

But

utsirabie

most

oe

economic

a

to

resources

over

course

rather

to

*same

the

consequence,

if

wrong

very

now

should

possible answer in
this matter, there can be no doubt
the

defense

if

In

of
na¬

that
the
American
economy' is
which stronger than it was when the
based upon, defense program started in midthan security
1950, but it also follows that the

plans—a

be

outlays,
go

and

current

security and to advance
the economic well-being and pro¬

taxes of

as

hand,

permitted to level off

are

during

time.

of

efforts

national

infinitely the greatest problem
us

a

adjusted to the level of public
spending required to support the

through

confronting

product

half

annual

our

decline in accord with now an¬

be

thinking and sensible
policies and programs,

economic
is

foreseeable

ment

opments.

unques¬

depositors

some

of

swer

constructive assistance to borrow¬

in

as

Administration, there

few who could correctly foresee
the enormous productive potential

I see it, is to
a

well

a

been

The first

strong for it is only

bank

po¬

as

current

less

existed

economy

parts of the past Adminis¬

some

positors prominently in mind. Any

capabili¬

economy,

and the national

in

the

about

one,

If political considerations should
is much stronger in
make
it impossible to .levy
the
important respects than it was
kinds and amounts of taxes which
1950, despite a much heavier

termined
by the best informed
judgment of security needs, and
ties, presents particular problems ties of the American
economy— should
not be tailored to false
at a time such as the present.
A ideas which he now admits to have
bank, if for no other reason than been in error. While these mis¬ concepts of economic necessity.
(3) Under conditions now per¬
the
profit motive,
is naturally taken notions about the relation¬
taining and foreseeable in the
anxious to lend money.
But we
ship between the national defense American

portant aspect of

better

a

economy

be¬

erroneous

rather to the fancied requirements

fense

devise

to

output since the Korean outbreak,
our

sincerely held by many men

ally on the increase. Adequately of an
economy
which is far
to satisfy there demands requires
stronger than they realize and
constant preoccupation with plans
which has a productive potential
designed to meet all customers'
beyond the range of their vision.
requirements and continuing ef¬
This
difficulty has not arisen
forts to maintain a well-trained
just since Jan. 20, 1953.
It has
and, I should add, a properly re¬
existed since the Korean outbreak.
munerated personnel.
The Cana¬
So honest and capable and patri¬
dian
public
is
accustomed
to
otic a man as General Omar Brad¬
banking services of a high order.
ley has stated recently in the
No depositor loses sleep at night
"Saturday Evening Post" that, at
worrying about the safety of his
a time when he should have been
deposit.
In short, good banking
telling the country how much de¬
is, I suggest, one of our national
asset?;.;,.

feasible

enue, I

If

Mindful of these

that

would

political

run.

Desirable Economic Policies

po¬

to

prosperous

a

nor

eco¬

litical commitments to reduce

penditures,

While it is theoreti¬

system than the current

business

though the Federal deficit is much
bigger, and it is less threatened
thing about banking. Banking in that we must
tailor our defense
by inflation, which was supposed
Canada is a dynamic operation.
outlays, not to the true require¬
In a growing country the demand
by some to be the terrible danger
ments
of national
security, but of a big and sustained defense
for banking services is continu¬

of

to

this

lower taxes nor a
balanced budget will avail us any¬

economy

the stubborn ad¬

worst,
to

neither

poor answer,

economic

policy in
general in these perilous times.
herence

They Are

as

subject of national defense in par¬

that

Constructive Banking

tax

sumption

Leave Taxes

truth

Finally, perhaps it would not
be inappropriate for the President

the tax base.

for

to it that the words "Made in

have become, a, hallmark of
value.
This is! much more

ther growth of the economy which
means
the further expansion
of

considerations—there will be need

be

We must

more.

moval of the deficit await the fur¬

economic

16

page

production
continuous
let the re¬

employment on a
basis, and to

nounced

from

to

year,

by plugging tax

maximize

to

growth

us.

continued.

see

and

would

Continued

next

tional

in

in¬

an

billion,

than

more

increase

period

now,

only about $37

much

poses,

or

impediments to
exchange of commodities and

currencies and I

effect

revenues

the

$82 billion

of

not

or

left

welcome

tions by reducing
the

take

about

crease

policies

alive to the development cally

rewarding
to

of

It is that of

today.

the

Canada

for

other officers who

and

for

keenly

branch

our

to

constant stream of visi¬

a

tors to this country, many of

analytical ability

the

on

common

reference

to

increase

incidental, but one of

life

meeting

time,

a

the

banker's

particular

places

that

brief

make

to

uled

be amiss

not

the most interesting, features

are

on

It is

the other.

May I quickly add that in mak¬
ing these comments I am not un¬

tion.

speculation

it would

die, to enact legisla¬

tion maintaining other taxes at
approximately current levels in
place of the reductions now sched¬

him¬

borrower

Tax

of

loopholes, to adopt other national

distinc¬

the

Profits

depositors, to
and, not least,

,

of

one

soundly conceived enter¬

therefore,

we

here

to

hand and -the well-considered

one

prise on

Canada's Responsibilities

who

and

confuse

between

risks of

action.

bear fruit in

achieve,
to

'

Perhaps

apt

are

lacking. tinental defense without sacrific¬
ing an adequate deterrent striking
force, would be to let the Excess

be

our

would-be

self.

plans beyond their ca¬

to

inclined

prayer

who

people

formulate

to

shareholders

our

to

The Canadian Landscape

to

appear

open-handed
financing
be an
ill service to the

Thursday, December 31, 1953

...

the

first half of 1950 to air annual rate

billion

within

we

shall

find ways to

seven

be

years

means

challenged' to

utilize all of

our eco-

Volume 178

Number 5286

The Commercial and Financial Chronicle

...

(2663)
nomic

resources

intelligently, in-

stead of letting them lie idle, even
if public outlays at an annual rate

we

to

do not have the fiscal strength to $60 billion
do

This

so.

argument

runs

real and

would

represent

a

irretrievable loss to the

Economic
to

grow

strength to do this and
and prosper at the same

whole nation and

more

along the line that the basic test
of our economic position is to be

billion above current levels. Even

found in the condition of the Fed-

perspective, if $5 or $10 billion of be
substantiallv
increased outlays next- year for
seem
to
me
desirahle
continental defense were to mean
legislation hrinmnp
the difference between this "mod-

should

rise

$10

$20

or

at the $20 billion

or

figure,

would, eral Budget rather than in the
still by 1960 have to expand con- condition of the national
economy,
sumption and business investment It is argued that a few more years
enough to absorb about $100 bil- of deficits, and an enlargement of
lion

more

per

we

than

annum

cur-

rently.

the national debt, would bring
to ultimate

ruin

if

even

we

us

main-

This is not to argue that we tained ful1 employment and full
*■
,j
argue tnat we production and constantlv enshouldwastefullyor unnecessarily P™u<:»°n
.

w

n

naatT0na°

ZXloJSJnomyfon'the'c^
trarv

out

have

T

that we
tnat

the intelligence
employment of

human
of

madness

-W

nf

i

•

of full prosperity, it is clear
force the tax reductions
beyond question that we would be
ns scneauiea
economically better off with this mLh+b n ft
continental defense than without
g ^ devise a better tax strucit-e
if'it
a
ture than we n0w have' but the
nance

Exchange, on Jan. 14 will admit
Laura T. Whitmer to limited partnership in the firm,

scSled New J
Adams & Peck Branch
V

Somebody

vln

mlant

largerFed-

shown

that

ID^RTFORD, Conn.—Adams &

Peck, members of the New York

stock

Exchange,

have

opened

a

2 works
it JSSfJS?JSf b-nch office at 18 AsylumSfoeet
fairly
well,

and

The facts are that, since World
War II, the fiscal affairs of the

m

lace

me

Federal

Government

have

been

with

That they have not been managed

decline

in

mihiin

that

sav

do

to

cw.

full

*n a fashion deleterious to the genbest with resnect to national se- era*
economy
is fairly obvious
curity and with respect to the from the history of our economic
vigorous
pursuit
of
a
durable development since World War II.
peace by leading from strength, During the fiscal years from 1947
be

aHnnt

tat
?+?'

into lin* with

mainte-

chn,,M

less

than

in

our

and

the

under the management of Leland

controversies

,

potential, it would

economic

the

evnenditurp*

material

in defense spending and in public

this

and

't.

attendant H. Wiley, resident
partner.
national output next year,' tax re.7 "
X
IT
J.
upon extensive tax revision might
duction would be inescapable, df £
us
from mM*.
many types of public expenditures
™s
important Kidder Opens New Branch
would necessarily rise, and the t""oiems.

even

do

recession"

A J

drop of $40 to $60 billion

sustained

I

defense

tl/L

JPut/k*i-

Mitchel, Whitmer, Watts & Co.,
14 Wal1 Street, New York City!
members of the New York Stock

tive b* looking at the facts.'
vi,vvv-

nointed

onr^

But

erate

Tf

Mit^K

AVlllcne?F vy mtmer /Admits
„

essary flrst of all to gain perspec-

ciofonco

outlays.

Just by way of adding to the

eral

managed on a very prudent basis,
in terms of the relationshio bein terms of the relationship between expenditures and receipts.

and

time.

maintain

to

resources

large

a

.•«

the peo-

and

the

our

-

all

means

frenuentlv

have

To

product

pie.

to

39

our

Federal
However, I think that the Ex^eaerai deficit—even it defense
aencit—even if defense
nu^er, i inijK mat tne Lxspending should level off or be respending should level off or be re- eess Pi of its Tax should be allowed
duced—-would be greater than the to die, because it tends to restrict
Federal deficit would be if 1954 is Productive advance. To obtain
i:

V11/ prosperous

a

lf defense

year and even
spending is decreased,

more revenues if defense expenditures should be increased, renewed

BRADENTON, Fla.—A. M. Kid-

der

&

York

Co., members of the New
Stock

Exchange,

opened

a

Twelfth

Street.

branch

and Paul R.

office

Ralph

Coloney

have

at

A.

430

Lahan

are co-man¬

agers.

Looking further ahead, if we ?nd m°re vigorous efforts should
follow those policies which help b9 made *° 9?,os^ tax looPholes. In With Hamilton
Managem't
to lift our annual national output X1®™ of the likely economic situa(Special to The Financial Chronicle)
on
the false ground that we do through 1953, and including the to near $500 billion by 1960, and
^,f+ext year' unless defense ex- DENVER, Colo. — Thomas D.
not have the economic resources current Treasury estimate for the if through building our
strength
SSL*' be
Pease
is
now
affiiiated
with
to carrv forward these
to carry forward these efforts
fiscal year 1954, the government we can avoid a total war, the conel o ts.
y
"7 ,b 1? s ' f dollars, I Fease
is
now
amnatea
witn
for the eight years as a whole will dition of
the Federal Budget over would doubt the desirability of Hamilton
Management CorporaAnle„Ve"^
situation might permit us safely ^ve achieved a surplus of re- these seven years ahead
gofog
rying to increase the tax burden tion, 445 Grant Street.
t

would

slewtariessen

eenrv

hut

not

ffrabUitv

of

production

the

lessen

expandfog

and

ura

the

de-

actual

emplovment

foil\onsonanci^ whhfoe

in

focrease

in ourDfoductive-potential
our

To do

productive potential. lodo

men^and a^rogressiife"disutfli
ment and
progressive disutiliza
a

tion of

za -

business resources, plus

our

cei'pts Tv^r" Txpendtoes in the
I^ghborhood of $13 billion, by
the consolidated cash method of
accounting which most economists
and businessmen agree is the most
™Ld„_m.eth°d .°LaacPunt,ng f?r
gurP°ses °f economic analysis,
Even

under

the

conventional

Kg6Vme.thod °f
Federal
Government
eight

wil, have

for

run

a

tolle vlly

fs
good'Tnd'eed'undefanl in~ tfie aggregate," because"this

David J. Brewer Opens
foreseeable levels of expenditures ™ld d-°.,™r?.
and, taxes: Whether'There" is" "a Pr°«re?s jhan it would do good by
PITTSBURGH, Pa. — David J.
Federal surplus averaging less ?a'a"cl"g)1tahe b"dgf: Even if de- Brewer has opened offices at 3519
than $5 billion a year during these f™sa 0ud\y,f sh?uld increase.so Brinton Road to engage in the

^

«ven years, or a Federal deficit
averaging less than $5 billion a creases
a

11

serious

than

even more

the

effect

upon

our-

selves*

these

A

short years ago, there
those who said that full em-

few

were

ployment and full production
undesirable

were

and

non-sustainable,
and that the economy would be in
a

healthier state if it could revert

to

to

lower levels of production

employment.

The

ot
is demonstrated by

fhiTsentiment
the fears

now

business

and

invalidity

running

community

through the
at even the

the

these

eight years.
have been even

might
we

had

While

it

better

if

surplus, these figures
demonstrate clearly that it would
be national folly in the highest
degree to let an undue concern
run a

about current

or

prospective defi-

cits interfere in the slightest with
our
national
security needs, or

ture
to

ado"pt ta^or'expendT-

to

cause us

policies

which

the

turn

might

economy

help

downward

slightest forebodings of economic

instead of helping to keep it mov-

recession.

ing in

The

action

recent

of

seven

vears

is

these

of 1% of our national output dur-

ing

a"

the

cost

security
nomic

or

it

hut

In

possible

fact

to

I

do

not
a

surplus except under conditions of
continued economic growth

On the

duced,
plans'
Plans>

J°+°

ja+*°lS' I
mar^ ou^

other

hand,

if

outlays should level off

In the
.t" u/.e perspective of these con_
P^pecuve ounese conP derations, it does not seem too
,

b£cause M

large

in

accord

there

m

with
of

be

Incorporated* Elizabeth, M

o,®¥

unemployment,

take

full

account

of the realities of the situation and
are

favorable

a

sign that the

rent. Administration

soects 4s
specis is
of

accepting
dctepiing
laid

the
uie

down

ployment Art of
For these

cur-

some

re-

objectives
oojecuves

employment

maximum

production

in

in

the

Em-

I do not find

comforti^ any Sector of opinion—
ih^de or" ufiide of government
•which maintains

that

a

our

policy of

issue

eyes

to

allow

from

away

it

to

the

m"ore " important" tasks'
upon

domestic

our

world survival.

our

and

1946.

reasons

nomic

T,

.

.

eco-

turn

people

so

troversial

bogged
tax

vastly
bearina:
and

progress

piogress anct

in

con¬

next

should

year

December 22,1953,

on

year

payable February 15, 1954,

the

★
**

done precipitately
7.'

f

because

.

f

our

eco-

^

..

...

.,

,

.,

.

subject of taxation

n

or

,

affairSj

a

moderate

DAYSTROM

DAYSTROM

DAYSTROM

★

FOUNDERS

ELECTRIC

FURNITURE

J

CORP.

DIVISION

INSTRUMENT

DIVISION

LONG ISLAND LIGHTING COMPANY

Notice of

Quarterly
Dividend

,,

budgetary

On the expenditure side, it is poijCy ^bat we neglect our sunff
hp^nm^upd
in
means that we will have inflation. my belief Jbat expenditures for preme task. That supreme task is
ctpJ?' that J ar! «tn'i in np'rL' In fact, we were running a surplus PurP°ses other than national de- to place ourselves in a better ponf
nartif mnhiifyatinn fhlf thp of more than
billion, both on lePs9 are n0v^ 1J®a:\ an irreducible siti0n to negotiate toward peace
wnHH
Ihiiatinn ppflcSr it« in the conventional basis and on the mi.nimum» and that some types of by improving our defenses against
tTni
and
fhaf thf nrllpc« n5 consolidated
cash basis, in 1948 pnme resource development might sudden attack and by continuing
when inflation was on the
march; even be increased somewhat to to build our deterrent striking
nrodr?^^
and we ran a deficit of more than Pravide. 3 m0+rvf
base ,io* forces/In the accomplishment of
n^ff pnpmn^a^n^ ^hp ^ilf iifiiw^i
billion on the conventional "abonal growtb: WlthT resPec+t t0 this supreme task, our basic eco??nn nf nnf prnn^mi^ L?pntfaV basis and almost $7 billion on the defenf expenditures, I am not an nomic policy should be directed
should hp vi^oroimlv rarHpd fnr'
consolidated cash basis in fiscal f7perl.,a+
have never claimed toward maintaining maximum
warri
Tn7aT?ha ytwetnnf; 1953 when there wa= no inflation the ability to judge what they employment and production, for
nnt he
iiiffieiencv nf HemanH tn but instead some signs of recesought to. be. But if the expert oniy by increasing our output
sustain the enlargement of em- slonary movements. Moreover, the
XsiXaMy highOTtLn they now every year can we with increasing
ployment and production is a re- maintenance of full employment eO"slderahly higheritnan tneynow ease carry the heavy burdens
noftlic

TYPE

it

}.
'
course, that any
seems to me that the longer range
deflclt exerts some inflationary uct of putting first things first, economic trends are still very
Pressures- Any tyPe of spending jf we do nothing but try to balexerts some inflationary pres- ance the budget, we shall not
Most important of all, we should
surS" Blit i1 does not f?llow that' balance anything.
n0^ ge/ ^ suf9h a bog Pntthe
111
the whole conext of
,

Operating Units

AMERICAN

emriorrw

£ut I do not think that this should

be

cinnndlv

holders of

to

record January 27,1954.

recession

think that this should

of national security and economic
A

relief

tax

declared a regular

quarterly dividend of 25 cents per share,

pronounced,
should
be

more

toVeactlvate

aeveiopmeni. a sounaiy halanrprl
oaiancea
budget must come as the by-prod-

...

economic

an

become

further

as t0 £e90rPe distracted from the
°yerwb n?lng y imP°rtant issues
devplonment

,

down

matters

of

signs

\T\ICE

The Directors of Daystrom, Incorporated

these

reduction

.

sufficiently serious

/.

f

consume-

^ou^d be allowed to

partly because I believe that

the

NOTICES

DAYSTROM

re-

f^rm^usc®nsYmP
tax

& Co.

current
d

be

expansion

enormous

broad out-

Vice-

G. Becker

A.

DIVIDEND

defense

or

Stuhldreher,

J.
of

President
jrlMlucllli

Even Inc., passed away Dec. 24

^ dLfralywith'thfb^o^dout- b°"lthy economy. gUndS
;311 aeal+1
y Wlth ll3 broad out circumstances the
pert^nTh^detafl^of thk matter" scheduled for early next
and

W. J. Stuhldreher
Walter

increase in defense outlays, consumPdon probably needs to be
stimulated if the economy is to
continue to advance,

eco-

maintain

bard

gnd

not

national

impeded national

growth

believe

fair kind Qf

.or at

ZfZ ^°«'d repress consumption.
^ there should be a quite

rather
deficit

reduced

of

the manufacturers' level

remain in
details are far less important f°rce> a^d the next priority should
the government in relaxing monejn short, "deficit
financing" has than the
more
basic
economic
a. ^Shtening of the tax burden
tary and credit policies, and-the
unfortunately ' become a serious
considerations which I have al-,?/1
recent statement of the Secretary
^ income families, .either
political
issue
in
the
United
of the Treasury- that-a gradually
ready stated.
In fact, I would through a raising ot the exempstates; but it is not in the United
dread having the nation and the
ns or in some other way. If
rising price level is preferable to states a
upward direction,

an

securities business.

comprehensive sales tax either
e retad level, because it is not

during

o7frHen1v nations eveenemo?; amounts ab°Ut ,$1°about one-third =ib"i«esP I would
°f °nly
,bil"0n' wbicb
lendiy naUtfonns
only
surnlus than

mies of
mies

essential, I would not favor

the not a "large enough question to
fostifv us in shrinking from vastlv '
de£idt >
« ® "^rinKing trom vastly g

year

deficit

a

anpp

Board of Directors has declared

The

quarterly, dividend of 25 cents

per

,

a

share

the Common Stock of the Company,

011

to stockholders
the close of business on Janu¬

payable February 1, 1954
of record

at

15, 1954.

ary

,

•

This dividend will not be distributed to

holders of the old Preferred and

.Common

Stocks of the Company (or Certificates

of

or to holders of
the old Preferred Stocks of Queens Bor

Deposit for said Stocks)

ough Gas and Electric Company and Nas
sau
& Suffolk Lighting Company
such shares have been surrendered and

exchanged for the

new

Common Stock

VINCENT T. MILES
Treasurer

December 23,1953

a

pudiation

of

cppvpy

nnn

aL,a" ,„5r°d"Cf.1°"1,1"„„be

,i«iahead, and the fulfillment of

to

,

a

level of the
when

greatest

it*

our

expand" productton world responsibilities, would
Tl.JSf" 2??!!: eminently desirable even if
reoudiation
qink«? to
thp
ucsu.ctuxc even
n

ability

I:11
Such

America's

„,pannn

it

is

preposterous, at

simultaneously

a

time

be

an

The
,me
some

have

argument
npnnie
people

the

is

that

economic

the

productive

the

obligations

advanced
we

we

certainly
and

strength to fulfill
which

the

world

situation thrusts upon us, but that




Vanadium Corporation
of

America

,

,

.

ECONOMIC ANALYST
Interested

Federal
of

the

in the framewmk
whole

economy.

experience
the

in

kind

If

of

moderate

some peo-

P'e are talking about

inevitable,

our

total

national

as

output in

we

financial

with

institution,

in¬

maintain full employ-

ment and full production. This $40

Lexington Avenue, New

420

broker,

or

industrial

or

-

Varied experience includes writing for top financial and

economic

university
No

journals,

consultation

teaching,

marital

ties

and
to

to

chamber

interfere

U.

of

jwith

S.

Government,

commerce

relocation

service.

and/or

travel.
Please

write

Box

S-1112

Commercial

and

Chronicle, 25 Park Place, New York 8, N. Y.

York 17

corporation.

1954

could be $40 to $60 billion lower
than if

connection

banker

we

calendar

economic recession that

even

in

,,

vestment

1954
hv

certoi„ra

resources

,

should

Full Employment, Economic
Growth, and Fiscal Policy

-

.

riSmfnDHce:^leve^^lthmSf^a

optimism

involve' SeCUr'ty Pr°gram W°U'd

--

ac-

JPh^p Tpvp? if
argued in some quarters that the) ® f+u
#level if compatible
economy does not have the pro-\7^
?e a^ainnJ®n^
these other
ductive power to service the level
daifribleS' W
even more
of
demand
which
being

'improved continental defense, thrust uP°n us by the international
then I insist that we have the situation.

to

Financial

Dividend Notice

the Board of Directors
a dividend of sixty cents per
declared on the capital stock
of the Corporation, payable March 2, 1954,
to stockholders of record at 3:30 o clock
p.m.
February 19, 1954.
Payment date
fixed after March 1st for maximum tax
saving.
Checks will be mailed.
B. O. BRAND, Secretary.
At

held

share

a;

meeting of

today,
was

Dated

December

22,

1953.

40

The Commercial and Financial Chronic....

(2664)

BUSINESS BUZZ

A

from the Nation's

■ •1 • •

y*

JLjL m

Capital

ture should business turn down.

What Will Happen

on
Behind-the-Scene Interpretation*

Thursday, December 31, 1953

What in fact will happen ulti¬
mately, if not in 1954, is that
this

g]

as

J* U Iv

housing report will be cited

an

for

argument

tension

of

vast

a

Federal

action

ex¬

and

spending in the housing field.
happen in 1954, for
^uxfcan, renewal" is one of the
It may even

: '. WASHINGTON, D.

so

committee report of a week or'
ago is rated as worth a long

of 1949 there is another
complicated skein of loans and
grants to disguise the fact that
the Federal Treasury pays for

and careful study.

most

— Theadvisory:

C.

housing

President's

This is not because the report

such is

-as

It is neither the program

ment.

President

the

*of
M.

policy-making docu-*

a

slum

of

nature

the

on

Cole, No. 1 man in the Fed.-:

will too.

In

-

*

-

few days they

will begin
to tell a little of what they want
in a housing program. Some of
it probably will come out in the
unofficial "State of the Union"
a

chat

fireside

President
next Monday night. Maybe more

will

come

the

by

out

official

the

at

a

the ideas In the

Some of

-

port

ministration

in

.Congress

Certainly

of the

Never¬

the

many

will

re¬

the
session.
report's

adopted

be

by

new

even

is

because

the

points inexorably in
That

tion.

direction

is

literally

and

filthy rich.
investment

is

of these

in

posed

that

FHA

a

cost

away

with the Fed¬

of

into

the

mar¬

guaranteed
Committee

the

Committee

would

with the financial

non¬

politically pegged in¬
rat# on guaranteed and
a

what

amounts

called

demand, the market says there
is a surplus.

a

but

to

"master

is

not

plan" for deal¬

ing with their entire problems
of housing. *

Government Is Deep in the
Heart of Housing

Fifth, the presumption is that
there would be

the

greater local

under

on.

(3)

This

In

is

with

$17.2

billion

Sixth,

Clearance
tation

and

per

housing unit

Make

the

an

of which the Treasury pays for
not less than 90% through an

Another

cus.

bousing units

loan

hocus

200,000

are

po^

public

waiting at the

are

And

It

is

a

housing,
a

new

ment

guarantee of some $000
millions of mortgage credit.

Under
and

the

Urban-

Slum" Clearance

Rehabilitation




pro¬

more

than

a

by the fact that 90% of

the cost in

actuality is Federal.

less than

cost

of

slum

two-thirds of the
clearance

is

Fed¬

eral, "even if additional sub¬
sidized
"loans"
are
excluded
from Federal cost.

Hence

,

minded,

even

inflation-

an

spending

Congress

is

limited in the dispensing of this

for there

a

comparatively in¬
almost
negligible
the population,

of

are

upon

competing political
which

to

expend

What the Committee proposed
was a

The

whole new deal, in effect.

"Urban

tration"

Renewal

would

loans

not

clearing

up

be

to

tate"

They

grants.

merely

for

also

Adminis¬

greatly broaden

and

be

These
for

of slums. This
aiding

would

the

out

would

be

blocks

blocks

and

of "sub¬

"decaying"

or

hous¬

ing, and get Federal aid there¬
for.
The

report

creation
fund"

of

for

recommmends
"urban

Federal

apply for, and how to cure the
housing.

evils of substandard

Basically the idea is for

a city
plan the development of vir¬
tually ALL of its housing, sur¬
vey it. Straight-out slums would
be handled, perhaps, as at pres¬

to

ent.

Offer Extended
In

Additional

aid

would

with

accordance

Treasury
Republic
of
Chile, dated Dec. 14, 1953,
notice has been given that the
offer of the Republic of Chile,
dated Dec. 7, 1948, to holders of
dollar bonds will remain open for
acceptance until Dec. 31, 1954.
11174 of the

Decree No.

Holders of dollar bonds who de¬

renewal

purpose.

an

this

financing is proposed for tech¬
nicians to go into metropolitan
areas
to help them figure out
how
many
projects
of
thisbroader character they should

sire

to

the

offer should
together with
form
letters of acceptance and
transmittal to the Fiscal Agent of
the Republic, Schroder Trust Co.,
57 Broadway, New York 15, New
York. Copies of the offer and of
forms of letters of acceptance and
transmittal may be obtained from
said Fiscal Agent.
accept

deliver their bonds

F. W. Archer

Opens

Own Offices

be

provided

for "decaying areas,"
slums. For housing a
little up the ladder, cities would
make provision for its rehabili¬

HINGHAM, Mass.—F. W. Archer
has opened offices at 107 Main
Street to engage in a securities

tation

business.

not

yet

then

and

government-

guaranteed loans would be

ex¬

other

the area of
Federal
aid
and
intervention,
direct and indirect, would
be
multiplied many, many times.
The
ultimate liability
of the
taxpayer
would be
infinitely
words,

this whole new

former¬

for

the

Keystone

Com¬

RIVERSIDE CEMENT
COMPANY

made clear that
expanded urban

was

housing scheme, which couldn't
get started quick even if ap¬
proved by Congress tomorrow,

was

pany of Boston.

greater and beyond imagination.

Finally, it

Mr. Archer

ly manager of the dealer service
division

tensive.

ould

municipali¬

the

of

process."

Class B (Common) Stock

and

"worth

be

for

rehabili¬

saving."
loans

and

would

become

the

basis

for

•

Selling at about 4% times 1952 earn¬

•

Anticipated

1953

earnings

•

"conserve
areas

w

stage

any

expected to
figure out ways, not merely to
clear out slums, but to clear

In

manufactured credit.

Anticipated

1954

earnings

ings ($5.85).

about $6.

a

(because

the

beneficiary
•

Selling at
1954

•

Most

of

about

Company

demise
4

about
will

be

$7
a

of EPT).

times anticipated

earnings.

cement

8-12

here

is

times

stocks

now

selling

at

earnings.

Available at around $28.

*

what

they also

Carl Marks

■

politicians
(and
it
be". meaningless, long),

won't

that

FOREIGN

tfie

mitted

to

government is com¬
.a- large
-volume of

housing construction: This is, of
course,

only the format state-

SECURITIES

SO BROAD STREET

of

mood

which

govern-

Rehabili¬

Committee
"Urban Re¬

much

so

limited

ties

"at

renewal

Cities

Slum

the

(1). A declaration, harmless
or
otherwise according to the

gammed" units of privatelybuilt
defense

re¬

Republic of Chile
Dollar Bond Exchange

a

signed:

to be built.

100,000 "pro-

probably will entail

of

So-they signed.

the government, and
13,000 units of ."defense" hous¬
or

conservatives.

so

change in the name. At the
present time public housing is

would
to

TO ALL I

market.

by

Then there

and

..

private enterprise
arrangement therefore. The
words about private enterprise
were lovely to hear. It would be
great not to be pilloried for not
making mortgage loans at a rate
pegged
politically
below
the

This is forgetting about a cou¬
ple of hundred thousand units,
more or less, of War II
housing

ing built, building,

lenders

tution

gate for the money.

held

Worse

They might get rid of Fanny
May. They might see the way
open some day to the ending of
public housing and the substi¬

aggregate of around $3.5 billion,

accounting and

It

this looked wonderful

All

the

or

the
other

and

newal Administration."

objects

on

Urban

program,

proposed

its

beneficiary) units costing about
$10,000

cur¬

ficence,

"low

to

pocus

housing bene¬
especially the ending
of the Defense Housing Act.

of

their way to the Treasury
are

fact, dis¬

recommended

restrictions

Already some 357,000 units of
public housing look like they
art on

the

finally,

and

Committee

insured loans outstanding.

feeding trough. These
cost"
(meaning - only

now

regarding the hocus
rently practiced.

a tidy little $11 billion or so.
Then FHA is in the insuring

business,

is

sys¬

longer terms,

payments,

place of the present

significant,
proportion

tion than

extension of

perhaps the out¬
standing feature of the report.

Not

grants
urban

is

largesse to

guaranteed some¬
thing more than 3,141,000 home
loans
for
$21.5
billion.
The
guaranteed portion of this sum

an

standard"

participation financially in slum

has

become

■

clearance and urban rehabilita¬

istration

has

FHA,

down

business.

The Veterans Admin¬

.

always decisions! — Should we
Boondoggle? — Should we increase our
Should I change into heavier underwear?"

enormous

Already the Federal Govern¬
ment is
deep in the housing

a

,

—

government guarantee

easier

Fourth, all aid to public hous¬
ing
and
for
slum
clearance
would presumably be held down
except where cities developed

the economic law of supply and

—

what

(2) An

.

tem

insured loans.

produced perpetually
large scale even if, under

of

ment

Asso¬

pumps

money

the

do away

be

dividend?

direct

Mortgage

which

Third,

butter,
tobacco,
etcM
the commodities which

problems
with

merge

per

pro¬

.

fiijiViiimhiiViM rr f'r-tfmVr-j\\mm I«'

"Always

accepted political fact.

Committee

the

Instead

terest

on

y

sale,

corporation allegedly capable of
existing on private money.

sense

must

on

in 1954.

flect the "behind the scehe" inter¬
pretation from the nationh^Capital
and may or may not coincide with
the "Chronicle's" own views.)

au¬

guarantee

National

Its further long-term signifi¬
cance
is
that
housing joins
among

and/or

report's outline of cake
the long-term

(This column is intended to

low-cost

construct

for lease
limitations

to

vate outlet for investment funds:

wheat,

words, Congress will
spinach.

HAPPY NEW YEAR

enter¬

would set up a private mortgage

competing pri¬

over any

to

years

loans.

Federal subsidy, direct and in¬

direct,

baked

given

be

ket for insured and

loan even more than now would
be given the preferred status by

on

large scale.

future, and some of it may be

declaration

a

private

effect,

Treasury

that

manu¬

is the recipe for

to

prise should replace subsidized
housing. To further dramatize
this point, the Committee pro¬

eral

significance to
the housing

Its
is

pleasing

are

conservatives, to wit:

One

ciation,

opment by the Federal govern¬
ment
of responsibility for all
housing except for perhaps the

loans will

FHA

feasible if the

In other

private-enterprisers, lenders,

posed to do

vast,
envel¬

almost all-encompassing

a

recommendations

s o m e

Second,

a

liberal

prove

with
which

housing someday.

direc¬

one

also

certainly not in

But the

it would hit
the
very
poor, man's
market.
Maybe this could replace public

if it doesn't quite mean to,

is

There

eat the cake but not the

under

report,

loans.

unpegged

government-

on

"better"
and
"integrated"
housing program. They came up

unit

lenders, but to the entire invest¬

politically
rates

that

"flex¬

facture of credit is resumed

a

"builders

This

More

only

all these manifold activities into

40

ment business.

is

case

1954.

thority to insure 100% loans for

housing mortgage

chance

approve

ish Fanny May,

-

this

housing

-

^

housing ad¬
visory study to try to organize

theless, this report is expected
to have a vast long-term sig¬
nificance not merely to home
and

President

little chance Congress will abol¬

in the Presi¬

came

set-up

that

ignored.

be

may

ideas

week from today.

will

or

inierest

Better

a

Program"

"State of the Union" Message to

Congress

ible"

about

little

is

Congress

this

when the Eisenhower Ad¬

So

dent

-

It

the

business decline.

a

There

sponsored

"Make

A1
4

for

books

of

$220 million.

eral

housing setup.., Some of it
Cole obviously" does go for, /
and
Mr.
Eisenhower probably

projects of

tools

thinking about backing in

There

clearance.

active

209

are

of Albert

nor

favorite

gram

TEL:

HANOVER 2 0050

•

&

Co. Inc

Send for Report T~31

SPECIALISTS

NEW YORK 4, N. Y.

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i

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