Full text of Commercial and Financial Chronicle : February 12, 1953, Vol. 177, No. 5194

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

UNIVERSITY
OF MICHIGAN

ESTABLISHED 1839

FEB 17 1953
MSJKU MMMSTUTIM
UBuur

Ik* Commercial
Reg. 0. 8. Pat. Office

Volume 177

Number 5194

New York 7, N.

Y., Thursday, February 12, 1953

Price 40 Cents

a

Copy

EDITORIAL

As
It is

now

We See It

becoming daily clearer that

j leader in the White House. His
dealing with Congress; where there

a

Lilliputians

well

as

as men

hand, somewhat to the

believed that

have

we

always

fine Italian

a

dismay of critics who had

the "professionals" in Congress

put the amateur in the JVhite House
in his place. There are, naturally, still very con¬
soon

siderable

areas

in which the details of the Presi¬

dent's deployment are yet to be disclosed,
pos¬
sibly as yet to be determined even in his own
niind, and there are indications here and there
that his programs will not always be fully ac¬
ceptable to thoughtful men.

Professor of

the whole

taking the right

course

inclined to treat the farmer

as

tration

r

even

making to get this country
again.

on a

solid footing

because

of

price

a

a

It is

chart of prices going

a

back

high peaks,

About 50%

number three in

portfolio additions. Volume was doubled
building stocks and there was
50% increase in acquisitions of autos and motor equip¬
ments.
Also well liked were the radio and electrical
in both the chemical and

a

(60.9 in 1861 to 132 in 1865).

Continued

pressures
on

page 32

Continued

on

suppliers,

page

rank as
fund

among

last three months of the year, a per¬

(104.9 in 1811 to 154.6 in

The type of

favorites

centage increase paralleled by the rails which ranked

1814).
Civil War—U6%

long-standing

one

purchases. Overall trust buying was
stepped up by one-third during the

Henry A. Long

I.

During these previous war
and postwar periods, wholesale prices
showed
the
following
advances:
(1926=100).

Dr. Jules Backman

War of 1812

number

retail, natural gas, non-ferrous metals and
Buying of the steels, while not heavy, in¬
the previous period.

food stocks.

World War I—145.0% (from 1914 to May 1920).
Each of the three earlier advances was followed by

launching must face, apart from the

tain \ their

;

very sharp price declines: The War
of 1812, the Civil War ahdeWorld

War

•

is

hazard which any such program
the Eisenhower Administration is apparently

its procedure &hd
lightened- cash, presumably to pay
year-end dividends.
Bdying of oils on balance was re¬
sumed by the investment companies
following the breathing spell earlier
in the year. The enthusiasm for the
petroleum issues; however, did not
supersede the popularity of the util¬
ity, stocks which continued to maiiv*
this group: reversed

fhree of which w!ere followed by
■■

A Hazard to Be Faced

as

during the most recent three months

review

.

our

once

It is largely

to 1800 shows four very

Meanwhile it is in¬
Administration

to

collapse aire often expressed'.
fact that

extension of New

all the aid at

appropriate

past experience, that fears of

*

cumbent upon us all to lend
command to the efforts the

is

examination of past postwar ex¬

periences.

Dealism, these will be events that we shall have
to deal with (or suffer with) as best wd may
when the occasion arises.

it

Many attempts io appraise.the out¬

an

generis, and if some of the sentimentality sur¬
rounding "social security" or the political pres¬
sures this sentimentality engenders lead to un¬
sound continuation and

Thirty-five of the 60 investment companies .surveyed
reserves of cash and governments during thfe
This represented twice the number
drawing down on liquid assets during the third quarter
of 1952. During that earlier, period,
practically ail of the closed-end
funds increased their liquidity, while

decreased

final quarter of 1952.

look for prices have centered around

sui

were

resume popularity with'many managements
during final quarter of 1952, as utilities continue favorite
group. Over-all purchases are stepped up by a third over
previous quarter, as cash reserves decrease. Rails,
chemicals, building, motor, electrical equipment and radio
stocks are also well bought.

the price question.

too much

if he

course

I have interpreted the title of
my discussion to mean
what is the long-term outlook for the level of prices.
This problem has been a, matter of concern throughout
the postwar period. With the advent of a new Adminis¬

presently

itj is found that the Administration is

Petroleums
of

prices during
and after previous major Wars; asserting the differing
action in current price level reflects combination of
sharp
rise in money and credit resulting from budgetary deficits,
postwar expansion in private Credit, record high level of
taxation, and sharp rises in labor costs. Regarding longterm outlook for commodity prices, concludes we have
established new plateau 75% to 100% above prewar
level, and prices will fluctuate above that level.

at the start,

and that is much to be thankful for. If

Baying of Oils
By HENRY ANSBACHER LONG

Economics, NeW York University

Dr. Backman traces historical

j It, seems to us nonetheless that the change is
on

Funds Accelerate

By JULES BACKMAN*

of

manner
are

of stature, is likewise

beginning to show the touch of

Would

The Long-Term Outlook
For Commodity Prices

creased two-fold over

34

Buying Of the Oils
The

by Dr. Backman before the 8th Annual Conference
of the Mortgage Bankers Association of America in cooperation with
New York University Graduate School of Business Administration,
•An address

interesting feature of the oil acquisitions was that
Co. was the most heavily bought issue in the

Texas

Continued

jan. 28,1953.

— Underwriters, dealers and investors in cor¬
afforded a complete picture of issues now registered with the SEC
potential undertakings in our "Securities in Registration" Section, starting on page 42.

on

page

24

SECURITIES NOW IN REGISTRATION

porate securities are

DEALERS

and

State and

in

WESTERN

U-S. Government,
State and

Securities
telephone:

Municipal

OIL & MINING

Pacific Coast &

Municipal

Bonds

SECURITIES

Hawaiian Securities

'i
t

«

HAnover 2-3700

r

Direct Private Wires

Chemical
BANK & TRUST

COMPANY

Bend Department

Dean Witter & Co.
14 Wall

Members of
and

BOND DEPARTMENT

$0 BROAD ST., N. Y,

Principal Commodity

Security Exchanges

Saa Francisco

•

Los Angeles • Chicago

Boston • Honolulu

j

STOCK and BOND
BROKERAGE SERVICE

T. L. WATSON & CO.
.

ESTABLISHED 1832

Members New York Stock Exchange
American Stock Exchange

Commodity Exchange, Inc,

for

Banks, Brokers and Dealers
50 Broadway, New

;

,

Members New York Stock Exchange

YorkI 4, N. Y.

Telephone WHitehall 4-6500

Teletype NY 1-1843

Members American Stock Exchange

30 Broad St.

BRIDGEPORT

Tel. Dlgby 4-7800

Tele. NY 1-733




OF NEW YORK
Bond Dept. Teletype: NY 1-708

PERTH AMBOY

1915

Electrolux Corp.

I

THE CHASE

Members ofA11 Principal Exchanges
50 BROADWAY • NEW

YORK CITY

Denver
Spokane

Salt Lake City
Los Angeles

NATIONAL BANK
...

Rainbow Oils

or new
an
yomc

or ne

and 10 other Western Cities

CANADIAN

Central Maine

BONDS* STOCKS

Power Co.

Prairie Oil Royalty

COMMON
Net New York Markets Maintained

♦

Analysis

and Banks

CANADIAN DEPARTMENT

Goodbody

&

Co.

ESTABLISHED t89t
MEMBERS NEW YORK STOCK EXCH.

New York 4

J. A. H0GIE & CO.
ESTABLISHED

To Dealers, Brokers

I

Hardy & Co.

THE NATIONAL CITY BANK

Street, New York, N. Y.

IIS BROADWAY

1 NORTH LA SALLE ST.

NEW YORK

CHICAGO

Dortmox Securities
(OKPORATIOTI
40 Exchange Place, Now York b.N.Y.
T

WHitehall 4-8161

request

IRA HAUPT & CO.
Members

New

York

Stock Exchange
Exchanges

and other Principal

111 Broadway, N.
WOrth 4-6000

Teletype NY 1-702-3

vpon

Boston

Y. 6

Tel®*??* NY 1-2708

Telephones Enterprise 1820

V,

; • -< s'. '/W

T ;

10

/i/'O";v
'

0
2

The Comvierclul and Financial Chronicle

(674)

WE

POSITION
TRADE

The

and

IN

Cv.

&

,

participate and give their

Louisville Gas & Electric

Common

tliey

are

Rights & Common

be regarded,

to

STEPHEN

Utility

Utilities

type of construction work which

JOSEPH

L.

B,telle & Co., New York

& Conv.

Raymond

Pacific Power & Light

installation
is

Copeland Refrigeration

the

in

crete

piles

with

are

the

as

-

where

or

1920

Associate Member

l'ounda-

t i

is

o n

Exchange

120

Broadway, New York 5
T*l-tvn<» VY i

e

xtensive
f |0 r

buildings

con¬

Stephen L. Joseph

structed along
waterfronts

Specialists in

cind also

of

'ion

Rights & Scrip
Since 1917

ft[cpoNNELL&fo.
Members
American

BROADWAY,
Tel.

NEW

REctor

YORK

2-7815

5

filled-in

on

land

structures.

small

A

mond to obtain advance informa-

and

Stock Exchange

prospective building work

on

the general trend

on

of build-

ing activity.

i

does extensive
outside of the

also

Raymond

construction .work
United

States, principally in Latin
America. Abroad, the company's

Trading Interest In

activities

embrace

all

heavy construction such

American Furniture

eign

exchange

have been such

Camp Manufacturing

types

of

midges,
buildings, etc. For-

roads, public

Basset! Furniture Industries

as

problems
a

Dan River Mills

Life Insurance Co. of Va.

LD 39

TWX

LY 77

LAMBORN & CO., Inc.
WALL
NEW

STREET

YORK

5, N.

Y.

SUGAR

serious

a

Refined

—

—

Liquid

Exports—Imports—Futures

and has already

for

Raymond

.

,

Raymond
from

'has

the

been'

benefiting

accelerated

of

pace

1856

the

to

steel

strike, earnings

dor the six months ended June 30,
1952

only $2.85 a share as
compared with $3.00 in the corwere

half

the

of

year

were

slightly under $4.00.
indications

the

on

pro-

yided by current business on hand.

witness

a new

record of

company.

Domes-

high rate of operations for
come,

some

while the backlog of
is at new high

Although

the_

Chicago

!
.

New

Exchange

during and since the

Cotton

Exchange

yet

Exchange,
Board

of

Cotton

other

Inc.
Trade

Exchange

Exchanges

Exchange

NEW YORK 4, N, Y.
DETROIT

GENEVA,

The

Stock

N. Y. Cotton

CHICAGO

period.

heavy

Orleans
And

industry

building'

Exchange

"

York

it is recognized

alternative

shore

directors

is

fit

saw

the

to

platforms

lands

extremely

PITTSBURGH

SWITZERLAND




share
were

a

dividend

year,

only slightly

$300,000

more.

While

this

construction,

been satisfied.

economists

believe

an

in-

demand

for

accumulated
war,

has not

Indeed,
that

many

spending

by the Federal Government, municipalities,
and
other
public
bodies, might be a strongly supporting factor for the economy in
the

event

of

a

general

has been, therefore, to

areas

of the so-called undeveloped
of

assure a

the

world

should

stock

would
at

with

common

no

long-term

the

convertible

produce

an

continuing

maintenance

While

this

mond

could

preferred having

called for redemption

1,

only

1952.

The

limited

a

stock

outstanding,

Feb.

stock

as

of

enjoys

marketability

ity could be improved through a
split in the stock or a substantial

also

sustained demand for the

shares

ultimate

the

was

were

it

be taken in the

would

appear

to

near

be

a

future,

logical

development,
While all of these factors might
cause one to

Southwestern
Common &

is another
even

Rights

Gkkstex & Fbenkejl
Members

150

N.

Y.

Security

Broadway

Dealers

Assn.

Now York 7

Tel. Dlgby 9-1550

potentials

that

Tel. NY 1-1932

may

In summary,

COMPANY

basis

substantially

is for these

Recapitalization Plan

potentials in the .)

there are

result in

situation which could
value

the

on

be

already evident. In addi¬

of values

tion,

to

appear

priced

attractively

BALTIMORE TRANSIT

the Raymond Con¬

shares

Pile

crete

in

a

of

excess

Memo

price of the stock. It
Pile

Raymond Conerate

"The

as

J. V. MANGANARO CO.

Security I Like Best."
**•-'

50

WINTERS

New

t

SIDNEY

R.

Members New York Stock

Broad
York

Street

4, N. Y.

TeJephone

Partner,' Abraham & Co., N. Y. City
and Other

Request

on

that I classify

reasons

HA 2-3878

9. 80

Teletype •
NY 1-2976

,

Exchange

St.

Leading Exchanges

Regis Paper

J like to consider securities from

strictly

a

long

companies.

Of course,

growth

not

every :

industry

of¬

the

same

fers

there

v

are

when

_t he

en

strongest type
of "growth

ever,
m

mo¬

h
I

ment,
i

be favorably inclined

Bought—Sold—Quoted

down.

the

At

potential development

greater interest. It is un-

Company

Common Stock

And

growth.
times

Oil

of

degree

e

Commonwealth

viewpoint,

range

and therefore tend toward

o w-

'

am

Prospectus

pressed

on

request

with the longterm
Sidney R. Winters

growth

potential
the

of
in¬

paper

dustry, and in particular, with the

Gordon Graves & Co.
30

Broad

Street, New York

4

prospects for St. Regis Paper. The
civilized
more

world

paper

per

ulations have

a

uses

Telephone

Teletype

capita, and

pop¬

VHiteluill 3-2840

NY 1-809

tendency to grow;

combination

the

constantly

creating the

growth I visualize.
St.

Regis

Paper

410 Pan

is

of

ers

Its

paper

of

one

the

American Bank

Miami

Bldg.

32, Florida

produc¬

and paper products.

principal lines

include

heavy
duty multiwall bags, various types
of printing, book and other spe¬

four

in -Canada

and

each

one

Over-the-Counter

Quotation Services
.

for 40 Years

in

Argentina. Brazil and Belgium.
capacities include 560,009

Plant
tons

of

kraft

paper

„and

board.

300,000 tons of printing and con¬

National Quotation Bureau
Incorporated

verting paper.,263,000 tons of mul¬
toward the Raymond stock, there tiwall bags, and 25,000,000 pounds
of

Public

Service

be realized.

selling at a
lower price than that currently and filling machinery. The com¬
prevailing. While there is no spe- pany's 28 plants are located mostly
cjfic indication that such action within the United States, with
may

R.

Common

stage it is too early to conjecture

plastic products, and bag making

old

Old

Ray¬
rapidly in im¬

grow

the

stock

Missouri Pacific R.

cost.

cialty papers; kraft pulp, paper
and board; fabricated and molded

The

of Manhattan

a

split 2-for-l in 1949 at which time

dividend.

offices

Ccmmon & Rights

portance as the status of the tidelands is clarified, at its present

on

it would appear to be to the inter¬
est of shareholders if marketabil-

stock

Bank

activity of

new

present

been

produce

slows

appear

preferred

debt

branch

our

importantly, to
appreciable saving in

one-

Currently, there are outstanding
approximately 390,000 shares of
or

or

lower installa¬

somewhat

to

tion cost but, more

to

75c.
four

levels,

business

recession. The industrial growth of
many

the

undervalued

be

wires

high initial

a

Raymond program in this respect
of

Direct

ranging

maintenance,
case of plat¬
forms of steel construction/is tre¬
mendous.
The objective of the

half of estimated 1952 earnings,

creased,

-

cost,
subsequent
particularly in the

base

NY 1-1557

Birmingham, Ala.
Mobile, Ala.

are

$1,500,000

is

that the

than

platforms

to

St., New York 4, N. Y,

HAnover 2-0700

in

used

ExchangeExchange

New Orleans, La. -

of-off¬

expensive,

from

payments

more

.

Stock
Stock

in the tide-

gas

These

area.

be

to

drilling for oil and

York

American

"ex

gone

regular payment of
in. contrast

construction

for

is the American Stock Exchange and largest, fully integrated

.cyclical in nature, the 4,boom"
phase of that segment of the industry in which Raymond is endefinite

CorrJhodity

a

New

25 Broad

experimenting
designs
and

been

years

methods

the third of

on

It is understood, however,

to

gaged should continue for

Members

New

some

Based upon the current price of
responding period of 1951. Indica- around 45. the Raymond stock is
tions are that earnings for the full.
selling at 6.9 times estimated 1952
year 1952 were in the neighbor- earnings and affords a yield of
hood
of
$6.50
per
share. This 7,8% on the $3.50 dividend. If
would mean that earnings for the
earnings and dividends can be in-

that_

H. Hentz & Co.

i

1953,

the American Stock

on

Exchange,

of

Steiner, Rouse & Co

derstood that the company i as for
with

activity since the war, financial condition of the company
with earnings of $7.11 per share as of the end of 1952 was satisfreported in 1951, $5.37 in 1950, factory and also that even with
$6.70 in 1949 and $6.81 in 1948. distributions -totaling
$3.50
per

;tic orders are sufficient to insure

*

American

payable

dividend"

note that

dividend

assured.

levels.

|

is interesting to

the -first
is

foreign business

Stock

ber. It

Co.,

Members

of 50c plus 25c extra each and a
50c extra dividend during Decem1'or

Bought——Sold—'Quoted

Members

the present

During the year 1952, dividends
totaling $3.50 were paid qn the
Raymond
Concrete
Pile
stock.
This consisted of four dividends

quarterly distributions of
1952.
The implications of this change
cannot be ascertained at this time,

time to

York

$2.00 to $3.00 per share,

as

This

a

New

profits
might
have been increased by as much
reported

March

foreign construction until
payment
in * U.y S.
dollars
is

^earnings for the
DIgby 4-2727

1

mond's

which

concern

1953- may

I

com-

to

serve

take any

Based

Established

and

make

second
Raw

amiable To tL parent

since the company does not under-

Due

99

operahe—

Hpclinp

pany

Abiaham &
City, (Page 2)

building

Lynchburg, Va.

I

"Hon*?

foreign

as

years,

which

*

S!RADER,TAYL0ft&C0.,1iic.

sequent

burden for many

other types of enterprises are not

Commonwealth Natural Gas

is much lower than the
actually realized. In sub-

that extent to
part of activities is devoted to stabilize reported profits. While
sub-soil investigations which are
figures on such retained earnings
made as a preliminary to build- are not
available, it is believed
ing construction of all sorts. While that for each of the years ,1951
this activity affords only a small and
1952, had all the earnings of
percentage of the total profit, it is the subsidiaries been declared as
important in that it enables Ray- dividends to the
parent,
Ray¬
tion

New York Stock Exchange

120

are

reported

company

piers, wharves and other

waterfront

subsidiaries

by them in U. S. dollars in
City banks. As a result,

amounts

or

sctivG in tho construe-*

is

though

working capital, it is common, in
periods of high operation such as
the present, that the distribution
of these earnings
to the parent

does

work

the

to

re¬

are

even

earnings
of
various
subsidiary
companies provide the required

re¬

The

quired.
company

BArclav 7-5660

a

firm

parent only

true

in any given
year may not necessarily corre¬
spond to actual income for that
year. Inasmuch as the accumulated

particularly

Corporation

is

of

funds

earnings

ground is soft

New York Hanseatic

the

of

This

New York

the

where

.

those

held

foundations
*

means

the extent that dividends

ceived.

employed

Polaroid

Stock

Louisiana Securities

Win¬

ters, -partner,

the parent. Accordingly, earnings
this field of these subsidiaries are included

Con¬

Paper—Sidney R.

New York

its foreign
of subsidiary

piles and

factor in

St. Regis

.

<

the companies, the accounts of which
in the a^e n°t consolidated with those ot

United

the

to

as

engaged

is

concrete

of

largest

States.

Electrol, Inc.
Filtrol Corp.

American

Alabama &

Selections

Pile—Stephen
Joseph, Manager of Research
Dept., Bache.,& Co., New York
City. (Page 2)
• " ^
*

conducts

operations by

Concrete Pile,

implies,

name

Puget Sound Power & Light

isMil "ar position

-

Raymond Concrete Pile
Raymond

r

supply.
Raymond

,

Iowa Southern Utilities

Established

Week's

Raymond Concrete

are not intended to be, nor
offer to sell the securities discussed.)

as an

Research Department
City

Manager,

Assoc.

Corp.
Schering Corp.

particular security

a

(Tiie articles contained in this forum

Southwestern Public Service

Central Public

for favoring

Tlwrjday, February 12, 1953

.

L.

Rights & Common

Eastern

reasons

.

Participants and

Their

a different group of experts
advisory field from all sections of the country

in the investment and

Pfd.

This
Forum

A continuous forum in which, each weok,

Hooker Electrochemical
Rights

Security I Like Best

.

of

plastic products.
-

Important

Continued

ex-

Established 1913

46 front Street
CHICAGO

on

page

37

Mew York 4, N. Y.
SAN FRANCISCO

Yolume 177

Number 5194

Volume 177

Number 5194

.

.

.

.

.

The Commercial and Financial Chvaninio

The Commercial and Financial Chronicle

.

(675)

Outlook for 1953

INDEX

B. S.

By DR. LIONEL D. EDIE*
r

Chairman of the Board, Lionel D.
Edi? & Co., N. Y. City

'

Funds Accelerate

Economic consultant, asserting boom has been
restricted* to
40% of the economy, predicts overall industrial production in

Long-Term Outlook
—Jules Backman

unchanged from 1952, but with change, in
distribution of business
activity. Expects stability ip con¬
sumer side of
economy.
Maintains no major depression is in
sight in 1953 or 1954. Cites past refinancing or debt
soundly
accomplished by Andrew W. Mellon.
Since

the; November

has

dence

in

been

a

elections
of

wave

business

and

general business outlook.

confi¬

business is

financial

myth and

this

called

of

wave

business, forecast

general

-

.

it

implies

for

If I

the outlook for '
A

me

i

r

business forecast,

c a n

This

the

of confidence

has

been

approximately..^ 8.
apt to be misleading for the

a

that

Confi-v,
is aH

dence

ways/a 'joy¬
ful

and yet I am
sure" every

businessman

Lionel

realizes

heavy

a

o.

Edi«

that

it

t

pre¬

responsibility

the

distribution
year

to be the

same

in 1953

You

average

in

to

certain

a

but

re¬

fact,

more

few

ican

business

the

over

next

This is not only

celebration

but

also

day of

a

extend

to the

broadly, they

but

longer in
As

the

interna¬

States.

position.- We

-are

hopeful,

our

we

uncertain and

are

members

Those Of

of

have

in

not

it

and

but

?

f

-'

■

is,

A

little

exports

over

today
me

a

was

"boom?

ment in

over.

international position

our

The Domestic

the

.

t,

'

part

of

'

situation

tic

question

and

what

outlook in

confront

is

1953?

the

the

business

When I attempt

that

question, I find a
great deal of divided opinion in
the country.
I find a great deal
answer

of

discussion

the

of

'

a

year,

The export "boom" is
That

..

.

,

"boom"

in

that

had but no longer
instance, two years ago
in the very exciting ac¬

For

were

we

tive retail trade.
upon

war

buying
of

the

of the "booms"

have

we

have.

one

at
fear

That

scares

and

hectic

a

based

was

consumer

because

pace

of

tailers who stocked

business.

The

is heard everywhere.
I
great deal of speculation as
how, long the "boom" will last
a

what

will

If you

over.

happen

after, it is

want to clear away

some

of the

day,

you

must

abandon

to

think

in

tempt
^

word,

*A

30th

talk

fog in the picture to¬

by

Economic

Edie

Dr.

of

be

to

protected.

up

We

had

on

inven-.

they

sure

for

a

were

time

any

time

and
in
any
language, a sudden
jump of 40% is a "boom." We had

of

the

it.

before
the

the

Peoples

However, the inventories then
have been deflated. The
inventory situation at retail today
is fairly normal and the consumer

built up

Continued

on

page

.

r

28

Associated Development

-—----.--m—

BROAD

New York

31

TELEPHONE EAnover 24300
Boston

•

Manchester, N. H.

•

;

•

.

•

Nashvjlie

Chicago

'

■

.

.

,

•-

Glens Falls

8

Schenectady-

•

Worcester

CROWELL, WEEDON & CO.

LOS ANGELES, CALIFORNIA




U. S. Airlines

8
22

—

From Washington Ahead of the News—Carlisle Bargeron___-

16

Indications of Current Business

39

Cenco Corp.
•

Activity.

*

and Bankers-

Observations—A Wilfred

Ma.y

5

HA 2-0270

30

Prospective

45

Security

Offerings....

Securities--

.

40

Exchange PL, N. Y. 5

Teletype NY 1-1825 & NY

40

Railroad Securities

Securities

&

47

—

Our Reporter on Governments.

Public Utility

Singer, Bean
MACKIE, Inc.

16

Our Reporter's Report

1-1826

We offer

21

Salesman's Corner.

29

Securities Now in Registration

42

—

Tomorrow's Markets

i::See

Henry

Says)

41

Common Stock @5%

48

...

Long's

cover

on

MANAGEMENT, Inc.

5

(Walter WTiyte

Washington and You

starting

2

quarterly

of

survey

fund

A

operations,

page,,

closed-end,

investment

.

36

record

The

Twice

1

Weekly

and

COMMERCIAL

Drapers'

FINANCIAL CHRONICLE

"A:

Eeg. U.

•"

B.

S...Patent Office

.

Reentered
ary

DANA

25

Park.'Place,

'

'

COMPANY,

N.

&

E.

Y.

C.,

Eng¬

asset

value

second-class

as

non-diversified

with

company

1500 %

gain

share

per

a

in

during

the past 9„years,
B. Dana

Owner

matter Febru¬

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

of

7,506,866

RESORT AIRLINES
stock.

1879.

.

shares

common

Report Available.

Subscription Rates

9576

D. SEIBERT, Editor

London,

25.

Publishers, York,

New York 7,

REctor 2-9570 to

Gardens,

of

c/o Edwards & Smith.

Copyright 1953 by William
Company

Publisher

WILLIAM DANA SEIBERT, President

j

Thursday, February 12, 1953

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

of

Pan-American

Union,

in

Dominion

Canada,.

of

OtherXountries,

$45.00

per

$48.00

$52.00 per

year;

per

S.

year.

EISELE &

KING,

LIBAIRE, STOUT & CO.

year.
Est. 1868

Every

Thursday

(general

and ad¬
vertising-issue) and every Monday (com¬
plete statistical issuemarket
quotation,
records." corporation news, bank clearings,,
state

and

Other

city

news.

Offices:

Chicago 3,

135

etc.).
South

Other

news

.

Private Wire to

Delhi Oil

•

Einzig—^"Gold Coin Counterfeiting in Italy"—.

TELETYPE N. Y. 1-5
•

Cinerama, Inc.

19

'

:

Corp.

Brown Allen Chemical

48

-

DealerrBroJker Investment Recommendations-

HERBERT

Stock Exchange

ST., NEW YORK 4, N. Y.

and Research

--Cover

Coming Events in Investment Field.

Dr[[Dp[n CTflPKC
I
ULrL
nII
ill L U 0 I UURO

Members

..

23

..

land,

Spencer Trask & Co*

Los Angeles
Francisco

<

__________

Business Man's Bookshelf-

WILLIAM

Albany

f

San

23

_____

Insurance Stocks—

Published

25

Philadelphia

Promote

±Bank and

For many years we n

specialized

Teletype NY 1-3370

Direct Wires

,

The State of Trade and Industry

Pa.,-January 6, 1953.,„'

have

*

Do to

Regular Features

,.

department

In

BO 9-5133

22

a

at¬

First National Bank & Trust Co., of Pitts¬
burgh, at the Duquesne Club, Pittsburgh,

Reilly & Co.

Air America

The, Security I Like Best---

stores.

v

'J

40% increase in the retail sales of-

the

terms

Meeting

tories

request

Incorporated

rr-

.

News About Banks

"boom."

and

22

—

_

'
;

Mutual Funds

only

on

61 Broadway, New York 6

I

Formation of Investment. Company to Bridge Dollar Gap
> Advocated

country.

find
to

>

ofi^A&yvt-?See It (Editorial)

shortages of goods.
It was accompanied by very ag¬
gressive buying on the part of re¬

American

-V*

f

Foreign Gold and Dollar Holdings..,-

ex-

of

That is

J. F.

21

•

;

employment and of
general conditions throughout the

remarks, I turn to the domes¬

my

to

Situation

detailed

more

of

It has been liquidated.

applecart
For

__

'

ago,

has occurred without upsetting the

during the coming 12 months.

\

conditions

two ago.

or

'Prospectus

20

foreign pol¬

the

Rgts

v

Eisenhower. Administration Should
tWeil-Being of Alf.the People-—
—1

*.

men¬

year

V

!

w

decline

a

w

Sulphur*

Wyoming Gulf Sulphur

18

_

Market—Miles L. Colean___

What the

port trade. That decline

icy. Therefore, I optimistically as¬
sume that there will be improve¬
our

15

_

Debt, Ref unding Main .Problem of New Regime--

no

tent myself by simply, saying that- trade to stay as low as the level of
I think there, is plenty of room for last August and; September, but
neither do I expect it to return to

our

Stock &

14

_

».

'*.«.•

■r.

were

.

'

Pan American

13

_

./
*
'
*
*
Hard,Carbides, Seen Increasing Industrial Productivity in 1953 19

thisJcwmdhm, Securities

improvement in

Banks^-AllanjSprouliJ

.

;.

"boom" condition.

a

into the future

gaze

%

,

has

was prob¬
ably overdone/ in the late, summer
and tell you what will happen ip and early autumn months o£
our foreign policy, but I will con¬
year.
I do not expect our, export

that I could

'

12

_

This

The Secondary Mortgage

In, '•v

time

one

about 40%;in the rate of

the experiences iri-that area. I wish

Mexican Gulf Sulphur

_i_

a

"boom"

a

Sulphur*

_

Mortgages as Life Insurance Investments.
:v—L'. Douglas Meredith_____
•___

part of busi-

The other 60% of

months,; .there

the

saddened by ,

are,

-

Country Needs Today Is Two Presidents.
^—Alexander Wilson

in 1952.

as

running at a new
all-time peak, with an annual rate
of $18 billion. >Within recent

have

we

who

us

families in

our

militaryservice

*

*'x

/

,,

What

12;. months

illustration, let

an

confident of

anxieties.

Gulf

11

Goals, of Banking in 1953—W. Harold Brenton___._____
y
i

,

tion the export trade of the United,

that

say

10

__________

"boom" ; / Restore Gold Standard Immediately!__
at all.
The "boom" is,
Britain to Stage "Trade-Not-Aid" Show____
to
about
40%
of the

liquidated

relations

hardly

can

reason

not. universal.

is

had

started

<When

scene.

survey our foreign

tional

Mack, Jr.___

Federal Reserve, and Savings

another since the Korean crisis

or

in¬

people
look abroad to Korea, Xo the Far
Elast, to Western Europe and when

are

10

On Credits-Paul M: Millians.

business

American business has at

to say that this confi¬

does not

ternational

we

is

total economy.

X regret

they'

9

as

than one-half of Amer¬

restricted

of

day

a

it

condition

challenge.
dence

Investmentsr—B. Earl Puckett

Problems of Trust Investments in 1953—Roland C.
Behrens..

WALL STREET, NEW YORK
Telephone: WHitehall 4-6551

%

is not likely

limited

ity that will be judged by the

.■

Department Store Securities

today !

Obsolete Securities Dept.

I

can

ness

sults achieved

of

throughout the

American business—a responsibil¬

years..

7

sold

are

Competition.*

to-/
gether, but the different quarters
and halves, of a year may present
a
pattern of contrast rather thani ^
of similarity.
There is a "boom"

emotion

sents

6

Conquest—Siegfried Garbuny

Trend of Interest Rates in 1953—Marcus Nadler___

—John B.

will again,',
But that is

be

pleasant*

thing.

i would merely,'

12-month' average

if obsoletes

4

Soviet, Foreign Trade—Road
to

averaged 218, I think ip 1953 that
wave

Cobleigh

What We See in Business—Buren H.
McCormack
••••*•>*-'
i *.
j
i, '
IIow Banks Can Meet Savings and Loan

that whereas the* index of in- in¬
dustrial production for 1952 has

finance.

TOMORROW

3

_

4

To Market!

general

a

Cover

Business Cycles—Roger W. Babson..

,

say

business,* and
-v.

forced to make

am

LIFE BEGINS
i

99

never

only as meaningless as it
is today, but also was apt to be
quite misleading.
•
•

what

—

.

not

was

confidence
means

General

AND COMPANY

Prices—

.

Stocks of Timber— Ira U.

in my experience
has there been a time when a so-

circles. I shall endeavor to
explain
what
I
think

for Commodity

Outlook for 1953—Lionel D. Edie.^

sort of mathematical

a

page

Buying of Oils—Henry Ansbacher Long^.Cov.er

The

1953 will remain

there

Articles and Mews

^

Bank

and

Quotation

$30.00 per year.
Note—On

Publications
Record

El.' (Telephone STate

Salle

St.,

2-0613);'

Monthly,

Members

of New York

Stock

Exchange

(Foreign postage extra.)

account of

the fluctuations

the
La

—

In

rate of exchange,
remittances for for¬
eign subscriptions and advertisements must

be made in New York funds.

50 Broadway,

New York 4

Tel. HAnover 2-6577

3

*

».

r*i

'*•

*.

i.

.-4. l j

;yl

i

i

i

The Commercial and Financial Chronicle

(67-3)

4

By IRA U. COBLEIGH

Co.

appraisal of three log and saw-mill leaders.
When

natural

vast

about

talk

people

our

they often

resources

forget to include our most important one—timber.
After we have
those

million

barrel

lots

of

oil, those tnllions

along,

feet

of

listed

to turning out

comes

and merproducts.
No

forest

chandising

of natural gas,

non-government

and those mil-

its holding of over

Y.

N.

on

S.

which

E.

we

tons

coal,

we

bearing

in

acres

2,500,000 treethe Northwest,
company for

»/
eumu at,ye and thebtack dmaen(Js per snare at Uec.il, lyoz

Not

with

our

so
iree
tree

U.

Ira

treasure
treasure,

r„h'dChdWoe

Cobleigb

place,

reforestation.

by

use,

!:n^e
4i^!S
of timber

acies

useful•
useiui,

eiflllv

ciaiiy

rvf

which

of

commer150
million
dou
million

are

with
wun

owned

acres

Altogether

land,

roughly 450 million

re-

after

individuals

by

or

'

was

a.
time

a

h

when^ we

exploited our forest
lands, leaving in the wake of the
i

Whereas traditionally the major
of Weyerhaeuser has
]umber> a broad expan-

business
been
m

de?df Paid from the operating

uthlessly

that

reduced

ratio

about

to

there°s

arborv
a wora.,
word
aipory, if
it mere is such
sucn a

ourself whether LQ at 29,

down from
.

1952 high of 43%,

a

f>r.rrpptlv

„nnrliw,

in

fhp

'

ma

and container board divisions of British Columbia Forest Products
the

Further

company.

ODerations

company
bv the

integrated

are

Canada is auite
t.*

uanaaa

0Perau°Vs are, iniegraiea Dy uie timber
ownership of electric power plants,
timhpr-hnul

and

railroads

rauroaas,

sea-

sea

ana

i,,mher

place for tall

a

.e,a p

so

let's take

,

r ;al1
a

British'Co-

there

leader

,e

look at

a

Jump?r ieaaer there, tsriusn jlo-

jumbla Forest Products, Ltd. This

believe

Cycles.

in- my Autobiography

Under" lished

$2,000

When

d

he

-'

some-

tells

a

not

baby empire in

a

itself;

and

it

and

selling at 68.; Dividend

now

policy
through the years has been
definitely on the conservative side

ging, rail haulage, and milling at
four

sawmills

.owned

at

Ham-

mond, Victoria, Vancouver and
improbably

named

place

Youbou, British Columbia.

an

called
•

.

'

Nineteen

good
gr0Ss

1951

fifty-two was not a
this company as
sagged from $7,465,613 in
to $5,500,000 in 1952 due to

SOme
strike

price
slippage, a 45-day
and more burdensome de-

the

is

borrowing

known

the

as

Hoskins

Cycle and ap¬
records of barometric

in

pears

without

1

This

pressure,

certain

commodity prices and the

sales of

some

he

cause

his

pinned
faith

Of

Business

tried

only

same

Roger W. Babson

year

labor strikes, building,

Not only do
own

industries

Mutual

which
last
did business of $4,000,000,000,
to go

without divi¬

dends for three years

all the above have

while wait¬
Be¬
sides, their sponsors could not
support a sales force under such

ing for the market to drop.

Cycles, but
may
have

The Main

they would

years,

Funds,

cannot afford

different
different
Cycles. For instance: Wheat has a
9.6-year Cycle; Iron and Steel a
6-year Cycle; Automobiles a 13year Cycle, etc. -

their

in six

once

Investment

rates,

interest

market,

stock

all brokers ridicule

course,

starve to death. Even the

Cycle apply to
the

cor¬

Cycle Theory. If too many of
their
customers
bought
stocks

make

to

the

leading U. S.

this

and

Cycle

25

rings,

tree

spots,

sun

porations.

o n e

on

conditions.

;
*

'

|

'

-

*.Self-ControI and Patience.
Operating
under
any
Cycle
Theory requires great self-con¬
trol and patience. It requires sell¬

for

year

in

.

Cycle it is be-

to the earlier stages of log-

more

1901

B usin e s s

is iess integrated than the others
Altogether this $320 million en- we've mentioned, confining itself retailing, manufacturing, etc.

terprise is quite

in

stocks, approximately

today

penny.

Chapin

in the

believe

Brothers of

City. Here F show bow

invested

000,000

you

o es

recently pub&

according to this Cycle, could1 (as
subsequently adjusted to include
latest data) amount to over $1,-

human

nature as-it is.

one

Harper

Dow-Jones

inevitable

with

by

New York

Cycles

ness

f

Universal' the Cycle used in the Addenda of

a

do

I

Busi¬

real estate,

going lumber ships.

has a magnificent
saw a vast stubby swath to stump
balance sheet as well, laced with
the experts — reforestation ex- ar0und
$58 million of net working
perts, that is. Forty years ago \ye capital. Only debt is $2,100,000 of
cut six trees lor every one we
a subsidiary. The rest of the value
planted. .Intelligent concepts of in
tbis
impressive property is
conservation, plus scientific for- vested in the 6,250,564 shares of
estry techniques, however, have common traded over the counter
now

for

in

Cycle.

Newton's Law of Action and Re¬

are

sion( program, implemented by a ketplace especially with dividend
tte nt "s x'yei/rs^has developeS accruals alone' o£ over twice the
[he pulp, plywood, kraft papPer, current quotation.

timDer nam

eornoratinns
T.
There

v.

[

leveling' out business ami- employment condition.

believe

Business

many

were an imposing $82.49. $1-95
share was paid in 1952. Dryl¬

deeper into the statistics and see

n.,

«ri

don't

action,

_

forever.

I

Business

This "A" has. a gimmick

held.

last the

This should

service in

unlisted, and closely

outfit were equal .to $3.12, pet
-share of-Class- A in 1951, when
never
geta virtual millenium, due to a most
in cash .was disgorged,
them
back- efficient program of cutting and'
By now you may be ready to
they're
gone replanting
decide whether you want to delve
of

lions

of

Babson, denying there is a Universal Business Cycle, says
are
many business cycles, which are inevitable with
human nature as it is< Says self-control and patience is required
in operating under any cycle theory and those who sell when
©theft are bullish- and buy when others are4 discouraged perform

itself

exceeds per

agency

Mr.

there

consider, and 542,401 shares

of Class "B"

Weyerhaeuser Timber Company
„ the biggest in the world when
it

Cycles

By ROGER W. BABSON

boasts two classes of securities,
593,872 of $4 cumulative Class A
shall

Weyerhaeuser Timber Co.

all

removed

timber

three

Business

'

.

....

.

Long Bell Lumber Corp.

So let's see how
titans are getting

management.

complicated.

ship of 51% of the common of the
operating unit, Long-Bell Lumber

industry; plus surface

An across-the-board view of the lumber

a

Thursday, February 12, 1953

.

income is derived from its owner¬

"Expanding Your Income*'

Author of

bit

The outfit
the Long
Bell
Lumber
Corp., a
holding
company whose
entire and sole
is

we're discussing is really

Stocks of Timber

;.

Cycles

ing when the government, brokers
Cycles, all working at and magazines are bullish; like¬
it requires buying when
the same time, 90% of the readers wise,
of this column are tied up with everyone is discouraged and sees
no
hope for stocks at any price.
five main Cycles. These are: (1)
Although there may be a score

of different

with $2.50 per share vouchsafed pietion and interest debits,
in both 1951 and 1952—roughly
Due to great industriai growth
40% of net. The stock was split in the area served, British ColumOn the other hand, those who do
The 35-year Cycle, which applies
2 for 1 in 1950 which offered bia Forest Products is thought to
so operate
on this Cycle Theory
to
agriculture,
weather,
insect
war
year), 44% of our lumber some market reward for the ex- have a favorable long range earnpests, etc. Every other 35 years perform a great public service in
consumption went to crates and tensive annual plow back in earn- : g
horizon
The common stock
helping to level out business and
bn-cg; against around 11% for ings here, especially since 1946.
'
TorontoTt 5%, with the Cycle is very severe. Hence,
If

of

we're

stabilizing

the

source

have been, at the
same
time, shifting our uses for
lumber. For example, in 1944 (a
supply

we

!fquo™

The

1952.

has

given

wooden

house

of its former

75%

up

shingle

market to tarred~Or asbestos roof-

these

Against

ings.

losses

sprung up vast new uses for
ber for pulpwood, plywood

mon

1952,
ranged

Less volatile

have

pect

lum-

haeuser

and

plastic bases. Still and all, about
55% of the trees we cut down
wind

For

lumber for building
and construction; and 80% of our
private residences are built of
wood—this despite the advance of
stucco,
steel and plastics; plus
gypsum and aluminum lathing.

a

a

Weyerhaeuser
between
than

you

66

com-

and

would

73.
ex-

lumber share to be, Weyer-

to have
lot of built-in value, and is decommon

veloping into

an

appears

industrial equity

of substantial quality,

as

up

Long

Bell Lumber Corp.

Another famous

name

in timber

is

Long Bell, fabulous grower and
distributor of Douglas fir, southern

and

western

pine,

hemlock

1952

of

of
40

cents, and
Specula-

59

cents.

tive, of course, and certainly no
Weyerhaeuser, but it does present
some

talk

some

earnings

dividends

interesting

growth

factors

about

also

employment conditions.

70-year

a

The

Cycle which affects us all

(2) the approximate 9-10 year

FoTlhe l^

Cycle. Every other

vertible 5%

Cycle

it would

be incorrect to

that the lumber business is

continuation

building at
unit
level,
lumber

of
or

above the million

the

position

company,

of

the

for investment

is not without merit. A
constantly growing stand of tim-

purnoses,

ber

can

times

be

of

worthwhile asset in

a

inflation;

comprehension
mands

should

of

better

and

today

sonable

we

have assumed

maintenance

of

rel-

present

market
make

de-

the

that

stocks

Qf

timj,er

rights^ that have produced better

filiated with Waldron & Company,

output and de-

been with Real Property Invest-

uses

In talking about Long Bell, we
ought to clear up a little of the

smart

inter-corporate relationship which

Co.

Building.
diversification

of

velopment

new

are

always

of

companjes

Lumb?r reserves are rated at may be ready tQ ^ _n gn jm_
some 2% billion board feet, which Drovpd ttPrfnrmancp this vear
would keep Long Bell supplied provea Pertormance this year.
with raw material for quite a U/Jfk Walrlrnn Rr fnmnanv
spell. Another thing, even where VVltn Waidron <3c company
the land has been pretty well
(speohd to the financial chronicle)
sawed out, Long Bell still owns it
SAN FRANCISCO, Calif.—
apd retains the mineral rights— Ralph M. Watson has become af-

in-

now

possible,

lumber

with




once

when

cycles

a

while

conflict.

—

tract

Basis the

stated, different lines of business

He

has

in

(Special to The Financial Chronicle)

LOS ANGELES,

Gillies

C.

•'

i

1

the

42-month

lated

the

: i i.

the

6-year Cycle.

This

connected

Co., 640

Street, members ot
and Los Angeles

York

Exchanges. Mr. Gillies

is

myre

& Co.

*

recently

WHAT'S AHEAD?

ments, Inc., and Capital Securities

1

'

■

of Oakland.

Ten reports a year
(co-author

Sent

to

Also,
to

for

as

a

1990.

eight

by Edward R. Dewey

Cycles—The Science of Prediction)

persons

Foundation

who contribute $10

for

the

Study

a year to

of

Cycles

9 E. 77th

Street, New York 21, N. Y.

"dividend,"

chart of various

a

This

projection,

years.

You will

Send

$10 today.

with

first

made
want

in

to

Ask for Chart Cl.

report.

was

previously with Marache, Doffle-

re¬

last

New

Stock

Cycles are

Cycle and

Calif.—Gordon.

become

has

with William R. Staats &

Market Cycles

Two other, common

com¬

With William R. Staats

South Spring
Stock

insurance

as

accidents and deaths.

desires and ambitions.

our

same

panies do. Stock losses can be
averaged the same as can fires,

to when their special 20-

vary as

and

gamzations and 111 retail outlets

in

because it misses
different

do

bankers

Cycle Theory

any

is

no

home

annual

in

10 years this Furthermore, although they admit
it might have worked under a
especially pronounced.
Gold Standard, it cannot be de¬
and are convertible, for the next Hence, some talk about (3) The
nine years, into common at $10 a 20-year Cycle. This particularly pended upon—they claim—with a
Economy
and
Paper
share. The common sold there in applies to real estate, new build¬ Planned
1950.
ing, wholesale prices and general Money. My answer to them is that
although, as above they can operate on an Actuarial
of course
in this little timber business
debentures sell at 98

cedar. An almost vertical activity in the building industry, year Cycle starts and ends. Ed¬
unit *n the industry, it originates particularly residential construe- ward R. Dewey, who is perhaps
best
living
authority
on
longer cyclical, much has been Its products on its own timber tion; and the national defense the
done to stabilize production since stands, processes them in its own program should continue to be an Cycles, shows that a 9-10 year
chaotic over production and in- logging
camps, saw mills, door important factor here,
Cycle applies to forestry, fish life,
ventory indigestion of the depres- and sash making units and sells
supply, atmospheric elec¬
Furthpr assuming firmer nrices ozone
sion 30's; and if we can assume them through five wholesaling or- {oJ m
"her in l953 it iToossibl! tricity and psychological changes
While

say

believe

not

Cycle.
is

conservative

Some

Cycle; and others about a 50-year

stock

1944,

see

what

has
it

market cycles, projected

worked
indicates

amazingly
for the

well

future.

Money back in full if not delighted

(pm

rr
Steel

The

Benjamin Levy

Production

50 Years in Street

Electric Output

Carloadings

State of Trade

Auto

Industry

Index

Price

his

J
level continued to be mildly higher than that of a year before. It
was close to the postwar record reached in January and about 6%

below the all-time high attained in the last quarter of 1943.
for

unemployment

were

benefits

in

which

normally increases between December and January, this
year rose by 500,000 to an estimated 1,892,000.
Business

inventories, the United States Department of Com¬
reports, were valued at $73.3 billion at the close of 1952,
representing a rise of $700 million during the year.
Physical
volume of goods increased more than the dollar gains since re¬
placement costs of inventories for manufacturers, wholesalers and
merce

were

for

"about 1%

during 1952.
wholesalers

lower" than in 1951.

Manufacturers

ac¬

the $700 million increase in stocks
Retail inventories climbed $200 million, but those of

$600

million

decreased

of

$100 million.

biggest question

HOW DID

the

What

o n

8,

1903,

first

em¬

S

1

a

o

o

m

n,

the

of

mon

Bros.

&

Hutzler

in

Salo¬

He
a

mon

A

histories in

be¬
J.

Ernst

Levy

product of the New York City

school system, Mr. Levy
graduated from elementary school
at the
age
of 13.
He attended
the

City College of New York for
two years before going to work.
He is

recognized as an author¬
short term money rates and

on

monetary finance and
consultant

to

serves

as

Jewish

will have to

find

satisfactory

a

by the end of the

answer

a

Philanthropies

of

second quarter if it hopes to keep production
going in
Now that wage controls have been lifted

New York and Trustee and Chair¬
man

of the Finance Committee of

order, free collective bargaining will be restored in the industry.
Meanwhile, steel price controls are certain to be out the window
by April 30, declares this trade paper. 1

the

Congregation

high gear.
White House

■

The possibility of increased labor costs is important

_

price picture. The United Steelworkers
for

reopening of their contract

a

of America

are

(on wages only)

to the

anytime after

Steel-hungry consumers are paying conversion prices
triple regular mill prices for hard-to-get items. And

double and

marginal producers have substantial order backlogs despite prices
well above the bulk of the market, continues "The Iron
Age."
But there are at least three good reasons
why there will be
no rush toward a general
price increase: steel leaders will not risk
adverse

public

reaction

to

He is also

committee

of

B'nai

Jeshu-

member of

a

Jewish

the

the

Theo¬

logical Seminary of America.

ise

Harrison Brothers Adds

Not

The

are

•

t

t

..."

•

,

,

Grayson-Eigles Co. Formed
Grayson-Eigles Co.
offices

at

82

has opened

Beaver

Street, New
York City, to conduct a securities
business.
Albert J. Grayson is a
principal of the firm.

as

scared of

factors

a

for

an

Empty-Belly

joining the Party,-say

or even

inclined to take their

men are more

intimate.

sex

rule

more timid than the average
citizen, and more
Sexual attraction and promise of intercourse with

boys.

desired

•a

means

members of
the Salt Lake Stock Exchange.
.

May

form of

some

Building,
,

sex

education in the country; and also less sentimental

Co.,

.

Wilfred

attitude toward sex is partly a declaration of independence from
,the morals of bourgeois society. Their sex life is casual, random, and
less monogamous than for the average person of their income and

iated with Harrison S. Brothers &

?

A.

the authors, are
striking and should create for the American people a real clue for
getting young people out of the movement. Their matter-of-fact

bers

LAKE CITY, UtahRoger A. Dorrell has become affil¬

*

motivating roots are psychiatric
or political, in contrast to the

activity
calisthenics, and much of the usual male sex aggressiveness is drained off by the Party's activities. Women Party mem¬

SALT

■

pages—Holt—$3.

American Communist Found to Be Sex-Starved,

as a

Atlas

the

that

They find that the

free to ask

May 1. If no agreement is reached by June 30, the union may
Strike, this trade weekly states.
Some price increases are inevitable. But
they will not come
overnight—except for a few small, marginal producers whose
costs are high. Industry-wide
advances, when they do come, will
be selective. Adjustments will be based on cost of
production plus
a reasonable
margin of profit.
>
t
If the price decisions were based
solely on what the market
will bear, producers could hike prices almost at will with
lifting
of controls.

run.

240

a

committee of the Federa¬

It

Loth.

A la the Kinsey Reports, the authors, work¬
ing through a large documentary of ques¬
tionnaires, base their conclusions on the prem¬

corporations.,
member of the

tion

of

David

situation in Europe and Asia.

finance

*

and

many

is

Levy

members, by an eminent
journalist, who reveal their case

a
a

—not economic

1

Mr.

Com¬

underlying thesis of the book is that
the people of the United States cannot wisely
and successfully combat communism in this
country unless they understand Communists.

public

ity

the

The

Hutzler in 1919.

&

anyhow that joins

newly published volume, Report
American Communist, by
Morris L.

the

on

Benjamin

Salo¬

Bros.

it
can

rank-and-file Party

lawyer, and

part¬

in

ner

is

How

WAY?

the Freudian Couch

trilogy being "What makes him tick?" and
"How best get rid of him?") has been explored
via
Kinsey-like questioning of 300 former

firm

1910.

of individual

THAT

on

This phase of our struggle with the Com¬
munist in America (the other two parts of this

who

came

GET

he be kept from joining up?
What induces him to stay in or quit? How can he be induced to
leave the Party?
J
•
•

the

of

kind

munist Party in America?

ployee of Ferd
father

HE

The American Communist

facing the steel industry is what to
do about the seventh wage-price
round, says "The Iron Age," na-.
tional metalworking weekly, the current week.
now

by

.

By A. WILFRED MAY

bankers, is observing
anniversary
in
Wall
Mr.

business
Feb.

founded

counted

Hutzler,

entered

brothers

retailers

&

securities

latest

Employment in the month of January, the United States
Department of Labor reports, set a new high. Jobholders numbered
60,524,000, or 750,000 more than the like period of 1952. The total,
however, was down a million from December. Unemployment,

The

the

Bros.

Salomon

the

rose

i

•

Levy

seasonally to the highest level in five months
still below the year-age level.

week available

but

insurance

50th

Street.

prior week
was in evidence in the over-all industrial output picture for the
period ended on Wednesday of last week. However, the production

Claims

Salomon

investment

Production

Business Failures

A modest decline from the near-record level ot the

j

of

ner

Commodity Price Index
Food

and

Observations

Benjamin J. Levy, senior part¬

Retail Trade

one

often motivate

a youngster's
joining the Party.
To
bourgeois homes Commie emancipation

of the converts from

freedom

from

formal wedlock.
Celibacy is found to be.
virtually nonexistent, and there is not the degree of impotence
among the men which, according to the Kinsey statistics for the
general population, we should expect to find.
There

is

a

reasonable

(from

findings) quota of homosexual

alities; there being
of

a

the

standpoint

of

the

Kinsey

suppressed homosexual person¬

slight analogy between the psychoanalysis

Communist and that of

a

or

a

homosexual.

There is less

Continued

on

recourse

page

precipitate

advances; they will lean
backward to avoid embarrassing the first "friendly" Admin¬
istration in 20 years and they have one eye cocked to see what a
new wage contract
might cost them, this trade authority points out.
Knowing they will be on the spot, industry leaders will au¬
thorize no price increases without economic facts to back them

over

This announcement is neither

an

offer to sell

nor a

solicitation of

an

offer to buy any of these

Debentures. The offer is made only by the Prospectus.

up.

It's

United
He

is

foregone

,a

Steel

threatening
walkout.

like

last

If

conclusion

Workers'

expected
a

to

strike.

the

that

President,

drive

a

hard

David

will

year's record

an

a

McDonald,
a

bargain—even

But the betting is for

steelworkers win

J.

demand

to

the

settlement without

increase

it will

be

concession, which averaged 25c

continues this trade magazine.
This week steel demand is

new

increase.
point of

wage

■

.

nothing

an

J.

hour,

persistent and powerful as ever.
Though high level production continues, and mills are becoming a
.

.

little

more

plenty of

current

pressure

on

/

Case

L
Company

as

deliveries,

consumers;

af£ vstill

Twenty-Five Year 3'/2% Debentures

applying

for all tonnage items.

Dated

The near-term outlook is that this market

tinue.

$25,000,000

■

a

concfiiion will

February 1, 1953

Due February I, 1973

con¬

Consumers

might apply even greater pressure (if that is
possible) for quick delivery as they become impressed with pos¬
sibilities of price increases.
In the next several weeks procure-




Continued

on

page

Interest

payable February 1 and August 1 in Xew York, .V. I*.

33
Price 100% and Accrued Interest

Copies of the Prospectus
as

may

may be obtained from only such of the undersigned
legally offer these Debentures in compliance with the
securities la ws of the respective States.

MORGAN STANLEY & CO.
BLYTH & CO., INC.

CLARK, DODGE & CO.

GOLDMAN, SACHS & CO.

HARRIMAN RIPLEY & CO.
Incorporated

KIDDEIl, PEABOD Y & CO.

SMITH, BA RNEY & CO.

MERRILL L YNCH, PIERCE, FENNER & BEANE

STONE & WEBSTER SECURITIES CORPORA TION

WHITE, WELD & CO.
February 11, 1953.

41

'-.amm.

■immu

■■

>

^

B

The Commercial and Financial Chronicle

(678) 1

to say

Soviet

Foreign Trade—
Road to Conquest

IF

the

plans of the satellites, origi¬

trade in their efforts at

nally two

the

even

Western World. We

needed

is

of

devil.

are

only

all agreed

the

of

f ew of

ry

scene

how

works,

was

to

sians
ternal

important

recognize

m

e

Siegfried

use

in

their

monopoly.

individual

convince

intentions, the Rus¬

based

this

system

annexation

of

mesh

a

on

This

the

or

traffic,
be imagined

not

profit

motive

can

other

will

based

as

indeed

treaties,

surprised
law,

respect

by

the

reference

constant

international

on

individual

and

be

minister's

smooth

as

Anyone

long the leader of Russian for¬
eign trade, before the 19th Party
Congress in Moscow last October

however,

intercourse

treaties.

to

Soviets

to

as

send

have

state

through

inside

Russia

complete

and

all

to

to

step

They

tries who

;

of

of

the

re¬

coun¬

puppet regimes

send

is

repetition

here,

are

less

but

known

orientation
countries

planned

economies
in

with
The

their

the

now

USSR

wells

also

and

Soviet

Com¬

proper,

of

but

underindus-

had

now

also

oil

,

»

:

only

are

guarantees

a

jurisprud¬

own

long-term

This,

under¬

they

so

by

securing

terial

industries.

orbit

and

moved

prices,

railroad

to

tariffs,

i

,

supply

and

gauges.

the

establish

Indeed

raw

the

for

make

naturally
Russia's offi-

by
the

commercial

legal

Soviet

this

in

tions,

February 11, 1953

standard

claim,

difficult

to

the

tually
in

Equitable Gas Company

of

believe,

war

the

We

in
the

as

however,

considering

Plan

including the City of Pittsburgh. Kentucky West
Virginia Gas Company, a wholly-owned subsidiary,
is primarily a gas
producing company owning sub¬

is

Area

ac¬

less inter¬

to

adjustment.

Redemption. 1 he Preferred Stock

will be redeem¬

able in whole
time

the

at

$105.50

per

time

at any time or in
part from time
option of the Company initially
share.

to

at

,

even

of

Legal Investment. In the opinion of counsel for
Underwriters, the Preferred Stock will be a legal
trust

funds in

Pennsylvania, if

on

required by law, and will be

for New York State

a

pur¬

different

a

road

legal investment

A

Exemption from Pennsylvania Taxes. In the
opinion of counsel for the Underwriters, the Pre¬
ferred Stock will be
exempt

•'

eign

*Kay, Richards & Co.

-

HuIme, .Applegate & Humphrey, Inc.

R. C. Schmertz & Company, Inc.

relating

to

Stock of

a

copy

of the prospectus

4.50% Convertible Preferred

Equitable Gas Company.




Name
Address

ac¬

foreign
anti-

of

Actually,

international

left

the

Conference

in

July, 1947. From then
one

persistently
United

on

in

the

and

in

after

States

Company

Thomas & Company

sistance

the Mutual Defense As¬
as embodied in

program,

the

America

trade

the

and

West

On

against

Union

itself

Western

not

let

the
pass

coun¬

in

its

be

not

from

sent

this

tions

that receive

Mutual

for

or

the:

Union

Soviet

those na-'

or

assistance from'

States

through

the

Agency."',,iVi

Security

Since the United States had al-,

,

„

the

to

couuntry

United

ready

denounced

in

June,

American-Soviet

1951

commercial

treaty of 1937 and also introduced
very' comprehensive • export
licensing

system

with

the

Export

our

trade

1949,
the

satellites

indeed

it

and

become

While

this

there

us,

that

of

Act

with Russia

has

harmed

indication

in v accordance

,

Control

negligible.

very

not

is

has

;

plenty

weakened

sub¬

stantially the Soviet bloc.
It

already

was

stringent
lies
in

reasons

have

said

continue

to

that
of

some

for
al¬

our

their

trade

goods with the Soviet

non-war

Union.

The

proper

allowance

Battle

Act

makes

it

where

for

such trade between, e.g., a Western

world. But

beyond
still

the

grow

That

from

Duy

materials

and

Western Euro¬

to

that

and

and

more

have to get

we

raw

goods

countries

pean

come

does

that

us

more

finished

not

indispensable.

trade

for

means

have to be vigilant

we

such

tnat

is

still

The

be¬

we

willing

more

them.

held

same

part

Then,

the

by

the

to

will

we

;

Soviet

goes for any

the

of

world.

of this then is

of

tariffs

our

in them

tion

of

and

other

any

trade

crea¬

barrier.

on

new

constitutes

victory for the Soviet

a

with

bloc

friends
refuse

whom

products.

disabuse

our

about its true contents.

Soviets

use

different

our

It

When

must

treaties,

sovereignty

and

be

by these

clearly

purpose

only:

•

power.

conquest.
'
'

to

It

serves

aggrandize

is

one

more

-■

'

,

2

al¬

understood

foreign trade

one

to

equal

terms.

Russian

Russian

*

they

the opposite of what

that

road

they

democracy, international,

conceive

we

propa¬

friends

While the

terms, they speak

language.

mean

ways

continue

against Soviet

and

ganda

we

,

furthermore

must

efforts

present

our

have to trade if

may

their

We
our

.

in¬

no

new

difficulty imposed by us.
imports from friendly nations

Any

a

lowering

a

no

any

conse¬

least

at

or

bloc^-

ally in

One

quence

eco¬

Moscow" in

April* 1952 the Russians professed
friendship

quality

useful ;to

Russians for purposes of war shall

commercial

net. At the international

World and invited

their

,be

law,

Europe into

confernce

by

may

rignts

opportunity to lure the

tries 'of

their

that

quantity

became

hand

other

does

provides

It

strategic materials and other,

Europe.

Hemi¬

Western

the

aggression.

to

of the chief targets of Soviet

nomic

Russian

refer

Western

Plan

on

un¬

insidious attack

Marshall

With Stewart,

I

■,

Eubanks

(Special to The Financial Chronicle)

Western

SAN

especially West

FRANCISCO,

Calif.—Jo¬

European countries to join hands

seph C. Eldridge and William H.

with the

Purcell

Soviet Union

deflected

trade
me

in

Molotov

Plan

other

Soviet

be

Please send

the

propaganda which depicted it as
" imperialist attempt to enslave

A. E. Masten & Company

C. S. McKee &

the

an

Arthurs, Lestrange & Co.

McJunkin, Patton & Co.

this

on

of

tune

ended

Russians

own

Fauset, Steele & Co.

march

the

minister

sphere

any

Chaplin and Company

its

Soviets

policies

White, Weld & Co.

Singer, Deane & Scribner

Reed, Lear & Co.

Haps-

therefore,

propaganda.

Paris in

:

Moore, Leonard & Lynch

It,

American

Europe.

McKelvy & Co.

now

finds

opposition

States.

Marshall

Kidder, Peabody & Co.

Merrill Lynch, Pierce, Fenner & Beane

it

by

one

Cunningham & Co., Inc.

the

commerce

The

Corporation

helped

of the West European trade which

by

trade cooperation when their for-

plus accrued dividends from date of issuance

doubtless

eventually acquire this last share

aroma.

conquest

determined

the

Price 8102 per share

has

successor,

crease

to

United

savings banks.

from the existing 4 mills
Pennsylvania personal property tax imposed for
county purposes and from the existing personal
property taxes imposed by the City of Pittsburgh
and the school districts of
Pittsburgh and Phil¬
adelphia.

It

inde¬

Russia well realizes that

chased in the exercise of the
degree of judgment and
care

•latter.

remember

the

the

S. K.

assume

were

yes,

republics;
the fleshpots

leashed

Jenks, Kirkland & Grubbs

they

pendent

the

The First Boston

machine.

well

wistfully

when

companies

Conversion Privilege. The Preferred Stock will
be convertible into Common Stock at the
rate of 4
shares of Common Stock for each share of Preferred

defense

therefore

burg monarchy might have taken

stantial gas reserves.

Stock, subject

state's

may

the

Value)

investment for

ECA

European country and the Soviet

living

economy,

Hungary

or

public utility engaged
production, transmission, storage,

through

Union is absolutely necessary and
serves the security of the Western

that, for example, Czechoslovakia

4.50% Convertible Preferred Stock

distribution and sale of natural
gas, serving about
225 communities in
Pennsylvania and West Virginia,

the

trade

ested in the citizens' welfare than

a

only

in

fore¬

a

this

seems,

Soviet

a

connec¬

as

countries,

Russians

that

100,000 Shares

the

dependent

the

of

trade

be accepted
conclusion. That

raised
the

themselves,
increased,

expense

Western

the

the trade

can

gone

the

been

with

turn,

the

at

satellites'

Business. I he
Company is
in the purchase,

also

enormously
in
saving
Western
Europe
from
Sovietization.
Its

these circum-

trade

and,

by

into

has

of the satellites among
should
have
greatly

Identifying Statement is trot an offer to sell these securities. They are subject to the registration and
prospectus
requirements of the Federal Securities Act. Information about the issuer, the
securities, and the circumstances
of the offering is contained in the prospectus which must be given to the buyer and
may be obtained
from such of the severalUnderwriters as are registered dealers in securities in this State.

form

annexation

That under

satellites

the

This

Par

but

ma-

is

Grossraum

stances

and

(Cumulative—$100

military

not

a

they

come

the

are

sealed.
*

brotherhood is still pushed further

NEW ISSUE

counter¬

aggression,

administered

aid

It pro-

markets

That

long time to
never stressed
cials.
Indeed,
treaties

ex¬

measures

to

measures

long

is the outstanding example of the

the

adequate

products.

which

recently

„

has

States

economic field. The Marshall Plan

say,* the

smooth development

tects them against crises and gives
them confidence in their future

Russian

Quite

the

items

satellites.

-

in

no

their

for
.

United

Russian

act

that

their

<a

know-how

constantly

there is

chance

taken direct

"bourgeois"

republics"
standings.

.their

refineries.

that

are

not

The

concepts forever advo-

changed between Russia and the

uniform

Germany, Poland, Czecho¬
slovakia,
Albania,
Hungary,
Rumania, anu Bulgaria. Neeuiess
ern

outside

to

stressed

patents

Soviet

munist China, North Korea, East¬

state

ship

even

Thus, the Russian

areas.

Rumania

oil

''Plan Area" thus created includes

to

factories

He

into

turned

Moscow.

help

; all

were,

and

immediate

of

sover-

Foreign Trade Minister Mikoyan -them also completely dependent
recently boasted that with Soviet on the USSR for what might be

mat¬

their past economic set¬

and

center

whole

trialized

their

No

consequences.

'equipment

relationships still last

degree, and

some

by
For

of the satellite

learn, next to the party

USSR. Where it is necessary they

es¬

in

by geo¬

alone.' These

the

for

mercial treaties with the "people's

production

production.

up

commercial

the

case,
Mr.
Mikoyan
and
his
collaborators
praise the fact that Russia's com-

the

to

vicinity

graphical

Battle Act of 1951,
is explicity devised for the protection

eignty of treaty partners—in brief,

so-1 far

gone

specialists
supervise

ceive trainees from satellite

mo¬

II.

to

commercial

relationships explainable

'

directed

and to train skilled labor in-order

through
new

War

and

satellite

the

charge

World

satellites

materials. There

raw

standing

commercial

.

of

too well known to bear

up

pri¬

over

corporations
took

No

allowed

was

commerce

The

partner.

one

long

termination.

and to

commercial

of their

were

so

abundance

in short supply that
from

The

means

a

gained

satellites

economic

the Bolsheviks, then led
by Lenin, reserved in April, 1918
foreign trade for the state as a

in

after

ter what

power,

borders.

economic

Thursday, February 12, 1953

.

.

some

harm¬

a

gullible enough of

are

have

by what the Soviet Union deems 'cated
necessary in its own interest. •
;;
ence.

principle

as

remained

and

tablishment

Garbuny

conquest

engage

the

relative

prosperity but rather

in¬

aggrandizement

power

years

Russia's

the

government

But

in

had

the

their

with

Civil

of

must

the Rus¬

as

who

their peaceful

l
The story of the subjugation of doctrine, mechanical skills in the

t

it.

attempt of
is foreign trade.
Immediately after their advent to

vate

long

Russian-Chinese

who reads the speech of Mikoyan,

commercial

any concern.

trade

the

mentum

we

effectively

world

as

small.

Soviet

instrut

n

be

the

of

materials pool is envisaged by
which each country exports raw

be

citizen

Russian

busy

foreign

the

cloven

Soviets

would

that

dustrialization of the satellites. A

for goods

affairs, the volume of Rus¬

towards

is

One

sians

simple,
state

in

1

to

on

enough

were

tively
of

nevertheless

chance

program. Just as

sian foreign trade remained rela¬

This

hoof when

survival

longer of

no

it

methods

the

was

Russian-Rumanian
or

appearance,

those

materials

Communist

individual

True

what

are.

program

the

for its

the

look behind

see

The

what

of

case

give all this activity

tion, are now orthodox five-year
plans in step with Russia's own

of

imported, the needs and demand

Yet,

To

less

they did for Rus¬
sia, the plans provide for the in¬

exchange

the

joint

Aerdnautics Lines.

raw

international

the

unin¬

most

the

course—

with

in

as

concern,

mixed

three years in dura¬

or

corporations

SovRom,
oil

and

Germany

where the Russians

management

Gross-

The

use by Soviets of foreign
world conquest, reviews activities by

goods.

its

Hitler's

the

Mr. Garbuny, in pointing out effective

formed know that the Soviet sys¬
tem is the greatest menace to the

the

of

all

Japan synchronizes its plans.

behind Iron Curtain.

us

with

Area

war

Today,

ve

of

mixed

the Co-Prosperity Sphere of pre¬

unified trade policies.
Calls attention to mesh of commercial treaties with satellite
nations and to anti-American propaganda.
Urges watchful¬
ness
of U. S. and Allies in preventing war goods shipments

it

Plan

some areas,

established—by force, of

v

Soviet

characteristics

raum

Russia and its satellites having in view
,

in

that great efforts are made

other regions, especially in the
The

GARBUNY

SIEGFRIED

By

^

in

Middle East.

.

.

and not to

United

by

States

Such

propaganda

underrated

in

its

must

not

be

effectiveness.

Practically all European countries
had

in

the

past

Soviet Union

a

and

market
got

in

the

from there

become

with ^Stewart, Eubanks,
&

policies.

have

York,

members
Stock

216
of

associated

Meycrson*^

Montgomery Street,
the

San

Francisco

Exchange. Mr. Purcell

was

previously with Wilson, Johnson
& Higgins and Stephenson, Leydecker & Co.

,

^Volume 177

Number 5194

.

.

The Commercial and Financial Chronicle

.

7

(679)

likely.

Trend oi Interest Rates in 1953

endeavor

By MARCUS NADLER*
Professor of Finance,

Dr.

Nadler discusses factors

both

long and short-term* interest

in

and concludes these rates will to

of what is to

the

capital, the

look leads to the conclusion that
business activity for the year 1953
as a whole will
remain at a high
level; the first half should not be

debt

and

materially different from
1952.
What happens later will be de-

managet

m e n

by the

Treasury.
during

As

termined to

large extent by the
international political situation;

the

past few years,
the
interna-

W

V
on*

business

psychology.

a

^

.

Long-Term Interest Rates

*

The

trend of

ernment.

elements of strength

aS

weakness

a

the

in

aVJle

ar+

mpossible

m?je ?PParent
will

it is

The

forces

economy are
high level of defense
spending,
plant and equipment

.es,

and

to

influence

favorably.
will

Capital

continue

though

they

smaller

in

at

a

may

the

half

of

current

the

The

year.

weaknesses
to

be

people

rapidly.

mort¬

and

during

gages

has

in¬

As is

the

last

few

years

authorities which premitted

may

already

been met,
expansion is be-

industrial

As

life.

bonds

The volume

offered

of

cor¬

since

the

The

that

developing

sec-

movement will

items

in

reinvesting, eveh

constituting

the

.

larger

repayment

outstanding debts.

may

will

Treasury should offer
a
30-year 3% bond, a downward
readjustment in prices of present

outstanding AAA corporate bonds
is

bound

of;

position and on the refunding
policy that will be adopted. Dornig the first half of 1953, the
Treasury should be operating with

presently

quarter of this year, it may
forecast not only a
slowing down
of the boom but the
widening of'

expenditures, New borrowing durin& 1953, however, is not likely
t° Play as' important <i role as
economic maladjustments, refunding operations. During the
indebtedness during* the-first half of the year, it is^
doublef"*

a"

whether

the

/Treasury

will

rapid rate.

Usually in periods of-offer any long-term bonds in exgood business, individuals as well * change for matured? obligations,
as business concerns are
inclined The first refunding operation anto

borrow

nounced at the end. of January
b-V the new Administration mdifavorably. In periods when the cates auite clearly that the Treasbusiness outlook is less favorable, ury will, go slowly and that it is
borrowing tends to decline, thus willing to pay somewhat higher
turn

more

stimulates

freely.

business

This

in

activity

accentuating the downward

-

.

rates of interest in order .to extend the maturities of government
whether private indebtedness will. obligations. In the second half of
increase during the current year tbe year, particularly when the
in business activity.

marketable

ing

operations

trend

by

Dr.

io,

1953.

Nadler

the

at

jn

bonds of
the

come

York

City, Feb.

with

compete




is

taken

bank

cerned

over

While

of

unless

situation
the

during 1952

were

stability

and yields on
high grade bonds including gov¬

inflationary
abuse

balance

goes
.

of

malad¬
of

pay¬

The forces

receding.

dead

on

the
con¬

The

center; and
political

international

should

dangers

continue

are

serious

a

are

is

the

that

the

or

the

inflation

to

of

become

worse,

inflation

should

recede

as

the

year

Competition is increasing, and profit margins in' many
on.

lines
not

are

for

farm

decreasing.

the

farm

Were

support

it

policy,

prices, if anything, would be

lower.
increase

The

interest rates
marked by con¬

either

or

in

economy

and

long-term

siderable

credit

signal

a

authorities

ments of the country.

Rates
*

as

central

justment

the

in

timed

bank

high
the

high
of

loans

level

in

the

volume of

reflects

of

merely the
business activity,

high cost of doing business,
taxes, and the acceleraticis

tax

payments.

debtedness

of the

The

large in¬

member

Continued

on

banks

page

3/

February 6,1953

I'.

$15,000,000

■\

Diamond Alkali Company
3Vs% Sinking Fund Debentures Due 1978
Rated

Due

February. 1,1953

February 1,1971'

The Business of the Company and its subsidiaries is
snd certain organic chemicals, the principal product groups

the manufacture and sale of basic inorganic
being chlorine, alkalis, silicates, chromateS;
including cement, coke and refractory periclase. A'

calcium

carbonates, organic® and a miscellaneous group
portion of the proceeds of the Debentures will be applied to the retirement of the Company's 2% Notes and
term bank loans now outstanding in the aggregate principal amount of $5,800,000; the major portion
will be added to the funds of the Company available for general corporate purposes.

short

Outstanding Securities of the Company comprise $3,000,000 short term bank loans, $2,800,000 2%
Notes, $10,000,000 3% Notes maturing 1957-1968, 120,000 shares of 4.40% Cumulative Preferred Stock
($100 Par Value) and 2,262,303 shares of Common Stock ($10 Par Value).
A Sinking Fund, calculated to retire at least 65% of the Debentures prior to maturity, will require
principal amount by November 1, 1957 and November 1 in each year thereafter
through 1968, and $750,000 principal amount by November 1 in each year thereafter through 1977, and
will permit any such retirement to be doubled. The sinking-fund redemption price will be initially 101.13%
of the principal amount and will decrease subsequently to 100% in 1975 and thereafter, plus accrued interest.
retirement of $250,000

The Debentures will be Redeemable, in whole or in part at any time at the option of the Company,
104%% of thc'principal'amount through January 31, 1954, and subsequently at prices decreasing to
100% on February 1, 1975 and thereafter, plus accrued interest.

St

Listing of the Debentures
due

on

the New York. Stock Exchange will be applied for by the Company in

course.

Price 10134% and accrued interest
to

yield approximately 3.30%

maturity

to

The First Boston Corporation

Goldman, Sachs & Co.

Kidder, Peabody & Co.

Harriman Ripley & Co.

"

I neurone* ti*«t

Merrill

Lynch, Pierce, Fenner L. Beane

--

McDonald & Company

*

"

,

Baker, Watts & Co.

Curtiss, House & Co.
,

.

,

Field, Richards & Co.

■

Jenks, Kirkland & Grubbs

Rotan, Mosle and Moreland

Company

Tucker, Anthony & Co.

Prescott, Shepard & Co., Inc.

Hayden, Miller 4 Co.

McCormick & Co.

A. E. Masten dc

Baxter, Williams & Co.

Ball, Burge & Kraus

tnoftrpnfxifrt

Singer, Deane & Scribner

Chaplin and Company

Moore; Leonard & Lynch
Robert W. Baird &Co.,

Wertheim & Co;

Merrill, Turben & Co;

.

Auchincloss, Parker & Redpath

Fulton, Reid & Cor<

Hemphill, Noyes & Co.

F. Eberstadt & Co. Inc.

Clark, Dodge & Co..

Dean Witter & Co.

White, Weld & Co.

Smith, Barney & Co.

Kay, Richards & Co.

Stifel, Nicolaus & Company
Incorporated

Green, Ellis & Anderson

Fauset, Steele & Co.

McJunkin, Patton & Co;

W. F. Kurtz & Co.

T. H. Jones & Company
L. B. Schwinn & Co.

It is doubtful

2%
address

long-term
government
obliga¬

well

debatable question. Usually
increase in the discount rate

bank

outstanding

increase

a

developments

The

place.

was

Identifying, Statement is riot an offer to sell these securities. They are subject to the registration and prospectus
requirements of the Federal Securities Ad. Information about the issuer, the securities, and the circumstances
of the offering is contained in the prospectus which must be given to the buyer and may be obtained
from such of the several Underwriters as are. registered dealers in securities in this State.

Please send

'

tion

1951-53

amount

due

into

a

of

outstanding

$7,986,000,000

conversion of

a

of the

relating

to

Name......

3%% Sinking Fund Debentures Due 1978 of

Address...

me a

'

*An

take

the

a

If, how- Treasury will have to borrow or
the weakness in commodity, not will depend on the ability of
prices should continue into the *be new Administration to curtail

A

to

not

rate

an

NEW ISSUE

appear to depend both on its fiscal

at

is

without saying

goes

or

be

ever,

has increased

Whether

the discount

moderate

,

„

In

activity,

years

These developments culminated

This

a

last few

a

by factors

demand and supply.

in
an
increase in the discount
rate of the Federal Reserve Banks
on
Jan.
15
from
1%
to
2%.

if, the

break of the Korean War.

Private

witness

or

analyzing the supply of and ernments at the end of the year
not
funds, and were
materially
different
without considering the possible from those prevailing at the be¬

cash surplus and be in a position
delayed readjustment' t° repay some outstanding infrom
the sharp
increase which debtedness.
During
the
second
developed shortly after the out- ba^
tbc Year> whether the

certain

of

needs, then long-term rates
remain either at their pres¬
level

ent

In

reserves,

1953

and

liie

of

utilization of de-

F'lc P°s^on °! the Treasury:
What the demand of the Treasury
lor long-term funds will be would

ap-

are

have been rather weak. It is
possible that this weakness
reflects

second

depend to

a large
Treasury's
debt
management policy.
If Treasury
policy should be to compete ac¬
tively with* industry and' mort¬

gage

obligations, short, as
long-term, to be iftfiu-

as

enced most of the time

the

on

to the neutral

in the

con-

now

have the problem of investing the
new
funds accruing to them but

i.e., the plowing back of

latter

well

therefore conclude that their

extent

circulation, and

government

one

a rapid rate.
All tions seem to be
adjusted already
mortgages carry amortization to a 3%*
long-term obligation. If,
provisions, and the actual life of a on the other
hand, the Treasury
mortgage is smaller than its con¬ should
go slowly with its refund¬

porate

currency

serve

im¬

an

long-term interest rates.

on

increased at

demand for long-term

has

a

new

modities

Pear to have Sone as far as 11 can
8°- The ^PP1^ of tax-exempt

commodity
notably of farm products,

merely

and

As regards long-term rates,

that

cause

Was

policy adopted by the Re¬

increase. * It

known, the volume of mort¬

This

credit

negative

vestment problems later on.

well

bills.

to the increase in
volume of commerical loans,
rise in the volume1 of

relationship ought to have

continue

will

sharpy in¬
rates", Not¬

in

will

savings—i.e., the repayment of
already outstanding debt—will be
considerable

Treasury

'

primarily due

some¬

what larger than'the demand

was,, a,

short-term

that this favorable supply-demand

The

less since the Pent-uP demand for
h°using has to a large extent been
met* Family formation in 1953
wiU be somewhat smaller than
durinS the Past few years, and
undoubling of families would ap-

be-

the expansion in
private debt.
spite of the very high level

prices,

the

of

grow

the

the end of the year

there

in

crease

The suPP}y of home mortgages

than

softening in commodity prices

business

to

of

in 1953 als0 should be somewhat

somewhat
year

should not

year

securities in all probability durstruction industry will
continue in® 1953 wiU be IarSer than in
active; the erection of new hous- 1952*
how much U 1S impos¬
ing in all probability will be sible to stale* Tbe
SUPP^ of m?"
smaller
than
in
1952, but this terials available for public works
should be counterbalanced
by an and for construction in general
increase in public works. The na- wil1 increase; and any downward
tional
income
of
the
country trend in interest rates, if it should
throughout the year is likely to- develop, will stimulate the offerremain at a
fairly high level.
inS of tax-exempt securities.
pear

ings

toward

pact

in

and

ginning,
ably

The total

if business activity remains
high level, the voluntary sav¬

sums

ml

expenditures

during 1952, with the decline
coming more evident in the
ond

bonds

large as during 1952. The
pent-up demand for many'com-

larger than before,

high level albe

long-

as

The

during the
therefore continue
business
activity

will

Gov¬

for

preciation and depletion

works, and the

prospects
for
maintenance of the national
income.
Military expenditures in all likelihood will not decrease
year

Federal

demand

income and the

continued need for

j

a

jng the current

sources;

expen-

housing^and
public
favoi able

The

the

past; corporations will continue
to rely primarily on internal re-

new
ai

also
at

tractual

long-term interest

ginning to slow down.

oper-

aung to mmntain the
the

portion of

a

during 1953 will be larger
during 1952. Not only will*
the
contractual savings through
insurance companies and pension
funds be larger than
before, but

also

and

or whether they

disappear.

outlet in

term capital by corporations dur-

be

to state whether
the
knesses will become
more and

ve

actively

oper¬

long-term market,
one may reach the conclusion that
the supply will be adequate and

•

,

are

will

refunding

the

011

v

Business Activity
ere

it

rates will

authorities and

n,.

whether

securi¬

repercussions of
ations

not actively
private sector
depend on the demand end of the war has been large,
of the economy for the savings of
will
exercise for and
supply of capital,
and almost all carry sinking fund
the
a
people, long-term rates of
strong inT]xe Demfmd jor Capital: The provisions. Many preferred stocks
t
u e n c e
Interest toward the end of the
on
demand for long-term capital will at present also carry such a pro¬
year may witness a decline from
pusiness accome from
'vi
corporations; the con- vision. Hence, institutional inves¬ the present level.
tivity
as
well
struction industry, notably hous¬ tors which are large holders of
and
investment
The Movement of Short-Term
ing;
political, subdivisions
and Nonds and mortgage® will cH or^y
politisituation

cal

as

#

tional

Marcus Nadler."

strength

credit policies
of the Reserve

System,

V

of

investment

than

and weakness in the business out-

anu

for

government

gages

come.

supply of anting" of the elements

credit

available

savings of the country.

an

*

and

funds

supply of long-term funds seeking

Money rates during the present at the same rate as in 1952 and it
year will be determined by busi- will
accordingly be less significant
ness activity, which
in turn will 'as a business stimulant. A baldemand

that

up

The Supply of Funds:

'

influence

is

known

mop

requirements for

gage

coming months,
large extent be influenced

a

or

not

compete with corporate and mort¬

by international developments. Says, because conditions are
so
highly uncertain, it is important that trust investment policies
be kept flexible and no definite pattern of interest rates or debt
refunding should^ be adopted until there is clearer outlook

-

is

Treasury will merely

to

long-term

ties

of

in

rates

be

may

New York University

which may determiner trend

What

whether the

Diamond Alkali

copy

prospectus

Company.

por-

long-term obligations

is

\

r.

8

The Commercial and Financial Chronicle

(680)

Department

Federated

Stores—Report—Granger &

..

•

Thursday, February 12, 1953

Company,

111

Broadway, New York 6, N. Y.
Also available are re¬
ports on Lone Star Cement, Magnavox, McCord Corp., Na¬
tional Tea, Pacific Finance, Republic Steel, St. Louis San
Francisco Railway, Studebaker Corp., Tri Continental, Vana¬
dium Corp., and Warren Petroleum.

Dealer-Broker Investment

Recommendations & Literature
understood

is

It

Ltd.—Report—Rutberg

Mines,

Iron

pleased
parties the following literature:

Feb. 13, 1953

Fiduciary Management, Inc.—Report—Eisele & King,
Stout &

Parts

Equipment

&

Manufacturers

of

Bulletin

—

Libaire,

Bank

Stocks and Price-Earnings

der & Co., 1

Banks

Co., 50 Broadway, New York 4, N. Y.

P> R. Mallory

randum

Breakdown

Gross
&

Government

of

Income

17

for

York

New

North American

on

City Banks—Laird, Bissell

Tax

Free

:

Stocks—List of 152

*

the

25

past

more—Moore, Leonard
Building, Pittsburgh 19, Pa.

Union Trust
U.
.

years

common

Government

S.

Portfolio

Distribution

Banks—Tabulation— The First Boston

New

of

-

-

.

path; and

bulletin is also available

a

V

'

_

'

on

the King Edward Hotel.

Servel,

'

'

April 30-May 1, 1953

States Plywood

,.,

corporation—United

v

'

•

N.y.;

*

.•

''

";

States

-York. City *

ating Earnings
York

as

Percent of

a

author

of ."Cycles"—&ent

lo

New York dinner at the Waldorf-

Capital Funds of 16

by Edward R. Dewey,

persons

contrioute

wfto

Astoria.

Wright Becomes Mr. 1700th Analyst

May

co¬

&1U

chart C).

cycles,

projected

to

1990

of

Portage Avenue, East, Winnipeg, Man.,
Royal Bank Building, Toronto, Ont., Canada.

America

:

#

*

f

*

Canada,

-\

National

-

and

on

York

6,

N.

Y.

Also

Carborundum

Corp.,

cal,

Laughlin,

&

Firth

available

Sterling,

National

memoranda

are

Hooker

Gypsum,

Bank

of

and

With Paul H. Davis Co.

Pittsburgh

(Special to The Financial Chronicle)"

N.

T.

CHICAGO, 111.
with

memorandum

Canada Dry Ginger Ale,
mill & Co., 14 Wall

J. P.

on

able

memoranda

are

North

American

and

&

Pacific

Railway

Company—Analysis—William

Central

Maine

Power

Co.—Analysis—Ira

Haupt

&

Diefenhofer Joins

Blair

Company, 135 South La Salle Street, Chicago 3, 111.

/'}'•+

Co.,

Southern Inv. Co*

Ill

(Special to The Financial Chronicle)"

Broadway, New York 6, N. Y.
Donegal

Petroleums

Limited

—

Bulletin

—

SOUTHERN PINES, N. C.—Her¬

Dumont Trading

bert J. F. Dietenhofer has become

Limited, 331 Bay Street, Toronto, Ont., Canada.
Electric
pany,

Elliott

Bond & Share
Co.—Analysis—E. F.
61 Broadway, New York 5, N. Y.

Company—Analysis—Eastman, Dillon

Hutton &

Broadway,

John

American

Enka

American

Durez

6,

N.

Phenolic

*Gustin Bacon

-

74

Y.

Security Dealers Association

Trinity Place, New York 6, N. Y.
^Prospectus




senior in the buying department, became
York
Society of
Security
Analysts
!s.

New

the firm

and Norvin

of Lancaster

Murray

Greene, investment advisers.

Shields, Vice-President of the

Bank

of Manhattan

Company, became "Mr. 1600" in the Society in 1952, and Lawrence
W. Fairfax of Dominick and Dominick

Two With J. A.

was

"Mr. 1500."

on

Request

Cruttenden Adds Two

fSpecial to The Financial Chronicle)

(Special to The Financial Chronicle)

D.

ANGELES, Calif.—George

Hansen

and

Michael

A.

Mar-

gucci have become associated with
J.

A.

Hogle

&

Co.,

CHICAGO,

111.

—

First

Albany Corp.

New Dealer Firm
ALBANY, N. Y.—The First Al¬

bany Corporation has been formed
with offices at 100 State Street, ta
engage

in the securities business.
prin¬

Daniel V. McNamee, Jr., is a

Hogle

LOS

Johnston Building,
Charlotte, N. C. Mr. Dietenhofer
was
formerly Vice-President of
McAlister, Smith & Pate, Inc.

■

M.

Greene, a member of the executive committee
of the
Society, presented Mr. Wright with a copy of Henry
George's "Progress and Poverty" which, according to custom, is
presented to each hundredth member. Mr. Greene is a partner in

SOLD

Troster, Singer & Co.
N.

the

Russell Reinforced Plastics

BOUGHT

Members:

in

Wednesday, Feb. 11.

Glass Fibres

Richardson Co.
*

Emliart Mfg.

1700"

Lancaster

Stocks

Plastics

111

Y.

Plastics

partner in Morgan Stanley & Company,

Story Wright,

investment bankers, and
"Mr.

York

Invest¬

Southern

ment Co., Inc.,

& Co., 15 Broad

Ltd.—Memorandum—Aetna Securities Corp
New

with

associated

Com¬

Street, New York 5, N. *Y.
Eureka Corp.

prior thereto was an officer
Blair, Rollins & Co., Inc.
•'

St.

Regis Paper.
Canadian

Davis
& Co.,' 10
Street, members of

and
of

Also avail¬

Aviation

H.

Exchanges.
Mr. Hazelwood was
formerly associated with W. C.
Langley &. Co. in New York City,

Inc.—Memorandum—Shearson, Hamon

Charles F.

the New York and Midwest Stock

Stevens.

Street, New York 5, N. Y.

Paul

South La Salle

Jackson—Memorandum—Auchincloss, Parker & Redpath, 729 Fifteenth Street, N. W., Washington 5, D. C. Also
a

—

Hazelwood has become associated

S.

&

Byron

is

:

HoteL

Charles Hazelwood Now

on

A.—Report—Loewi & Co., 225
East Mason Street, Milwaukee
2, Wis.
Also available is
a
special report on Kellog Company.

available

.

Electrochemi¬

Company—Analysis—J. V. Manganaro Co.,
Street, New York 4, N. Y.
'

America,

Security Traders Asso¬

the Hollywood Beach

Transit

Broad

at

;

.

Investment Bankers Association

Metallurgical.

50

meeting

of America Annual Convention at

American Marietta Co., Foremost Dairies, Inc.,

Steel—Memorandum—Goodbody & Co., 115 Broadway,

Baltimore

<

(Hollywood, Fla.)

Hydraulic Press Brick Co., Mountain Fuel Supply Co.

Jones

Spring

Nov. 29-Dee. 4, 1953

*

Phillips &
Also available are

Co., 44 Wall Street, New York 5, N. Y.

New

'■

ciation 20th Annual Convention.

American Air Filter Co., Inc.—Memorandum—B. G.

Armco

(White Sulphw

Sept. 14, 1953 (Sun Valley, Idaho)
Oils—Brochure—James Richardson & Sons,

173

memoranda

1953

the Greenbrier Hotel.

for

•

Western Canadian

•_

(ask

.

Investment Bankers Association

-

market

;

•

Springs, W. Va.)

to the Foundation for the Study of Cycles, 9 East 77th
Street, New York 21, N. Y. Also as a dividend a chart of
.stock

•

13-16,

a

year

various

(New York City)

May 8, 1953

Security Traders Association of

City Banks.

What's Ahead?—Ten reports a year

of: A meri can:

Association

Spring Meeting at the Plaza HoteL •

George F. Breen, 20

Corp., 100 Broadway,

Mean

•'

Investment Bank¬

Texas Group

-.

New York 5, N. Y. Also available is a tabulation of Net Oper¬
New

Dealer#

Municipal

May 7-8, 1953 (San Antonio, Tex;)

ers

Vermont Industries, Inc.
Circular
Pine Street, New York 5, N. Y.

.

- v

Louis

Group annual outing.

Corporation—Brochure entitled "First

story of- the

(St. Louis, Mo.)

St.

..Plywood Corporation, 55 West 44th Street, New York 18.
m

annual

sixth

ford Hotel.

Company—Complete 1952 annual report
including -President's review of the year—Sun Life of Canada, 218-Sun Life Building, Montreal, Que., Canada.,
-

the

Societies

convention at the Bellevue-Strat-

.v

Sales,"

j

National Federation of Financial

Analysts

Analysis and review of the Cement
Co., 10 Post Office Square, Boston 9,

—.

Life Assurance

Came

& Lynch,

or

April 12-15, 1953 (Phila., Pa.)

United

stocks free of county, city* and school personal property taxes
in Pennsylvania and which have paid consecutive dividends
for

r

Canada)

the beaten

.Sun

favored

Long Dividend Paying

Hotel.

Toronto Bond Traders Associa¬

R.

Industry—Lern.er &

by the company—Amott,
Co., Inc., 150 Broadway, New York 38, NV- Y.
<

Baker &

lin

tion Twentieth Annual Dinner at

'/Mass.

,

stocks

Philadelphia annual Mid-WinBenjamin Frank¬

of

ter Dinner at the

in current issue of the "Monthly In¬
Williston, Bruce & Co., 115 Broad¬
way, New York 6, N. Y.;
Also in the same issue is a dis¬
cussion of Sante Fe, Underwood Corp. and a list of Oils off
Inc.-

Outlook—Reappraisal—Sutro Bros. & Co., 120 Broadway,
New York 5, N. Y.
* -. 'V-< .v
1953—20

(Philadelphia, Pa.)

1953

20,

Investment Traders Association

Corp.—Analysis

-Riverside. Cement Co.

Rail

for

Feb.

Co.—Memorandum—Smith, Barney & Co., 14

vestment Letter"—J.

parison between the listed industrial stocks used in the DowJones Averages and the 36 over-the-counter industrial atoctai
used in the National Quotation Bureau Averages,: both as to
yield and market performance over a 13-year r periodNational
Quotation • Bureau, Inc., 46 Front Street, New
York 4, New York.

'

a memo¬

Street, New York City. Also available are memoranda
United Shoe Machinery Corp. and Westinghouse Electric

Philco

their

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

Stocks

Also available is

March 6, 1953 (Toronto,

availability and advantages—Review
—Model, Roland & Stone, 120 Broadway, New York 5, N. Y.

,•

York City.

meeting at the

Drake Hotel.

Corp.

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

Convertible Bonds:

of America winter

Wall

of

Sources

and

Portfolios

Bond

Investment Bankers Association

Montana Power Co,

on

(Chicago, I1L)

Feb. 13-14, 1953

& Co., Inc.—Memorandum—White, Weld & Co.,

40 Wall Street, New
—

Paine, Webber, Jackson & Curtis, 25 Broad Street, New York
4, N. Y.

the East Room of

the Hotel Schroeder.

Co.,

Life Insurance Company—Analysis—CrutCo., 209 South, La Salle Street, Chicago 4, 111.

Ratios—Analysis—A. M. Kid¬

Mid-

Club

Bond

Winter party at

National

tenden &

Wall Street, New York 5, N. Y.

Comparative analysis of 42 representative banks

—

Lincoln

Field

(Milwaukee, Wis.)

Milwaukee

Royal Bank Building, Montreal, Que., Canada.

statistics—Stanley Heller & Co., 30 Pine Street, New York
5, N. Y.

Investment

In

Company,

&

Kerr-Addison Gold Mines—Memorandum—G. E. Leslie &

Automotive

EVENTS

Inc., 31 Nassau Street, New York 5, N. Y.

firms mentioned will he

the

that

send interested

to

Fenimore

COMING

Andrew

cipal of the firm. Mr. McNamee
was
formerly Vice-President of
George R. Cooley & Co.

B.

Bryngelson and Frank J. Fitz¬
gerald have
become
connected

With Louis Love Co.
(Special lo The Financial

MENLO

West. with Cruttenden & Co., 209 South
Sixth
Street.
Mr.
Hansen
was
La Salle Street, members of the
previously with King Merritt & New York and Midwest Stock

Ferguson

Co., Inc. and C. E. Abbett & Co.

Hermosa

507

Exchanges.

staff

Chronicle)

PARK, Calif.

—

Edna

has been added to the
of Louis A. Love Co., 700
Way.

Volume 177

Number 5194

-

The Commercial and Financial Chronicle

..

.

i

(681)
ibility.

Department Store Securities

We know

histories
ords

of

that corporate
filled with the rec¬

are

term "trends

By B. EARL PUCKETT*

^

V

demands to

and

as

undertaking risks.

Also

strong point, stability and growth of

these

demands

..

.

we

~

m

_x

Allied Stores Cor-

-x

.

com-

I

pany,

fri€nd

;

for

am

committing
single purpose

,

going to direct

regular

discussion

iUy

• i

depart-,

e

ment'

storer

field. With

,

credit
than

more

strong com-,
ehensive

on

central

balances

agement

and

purchasing
setup, >Allied
has
the

many,

'■

of

character-

istics

of

B.

a

Earl

Puckett

chain store

On the other hand, most

system.
of

individual store units were

our

developed

originally

is

at
In

deferred

on

seldom

is

than

more

merchandise sold. The investment
in
deferred
payment
accounts
turns

over more rapidly than an¬
nually and provides a very hand-

some return in the form of carrying charges.
;

The

continue to pos-

automatically results in

a

bad debt

many

On these

such.

to be the most meritorious charac-

teristics

of

the

chain.

•

This

has

been done by

copying or adoption
by adaptation. Not only
the background of the individual
store units now operated by Allied
well

as

as

but also my own

personal background, before joining Allied, influence me to approach my discussion today from the department
store viewpoint.
nivpreifiratinn
_

.

...

I wonder if the extent

to which

the principle of diversification is
inherent in. 3 #dep3rtment store
investment is
the

average

has

built-in

a

amount in total.

as

its

to

In times of

good

business, when the risk is all but
non-existent, the amount expands,
As

business

activity recedes,

the

i amount of such investment diminishes

automatically,
into

verted

tions at

the

being conthrough collec-

more

rapid

than

lower level of sales,

new

The

ca6h
rate

a

third

major investment

of

a department store company, and
one that is frequently smaller than
githgj. 0f

other two, is that of

inventory. This is the risk investjg

fully understood by

investor

governor

subject to unbslsnce

obsolescence, and price fluctuaeyen his tions. Unlike that of the average

or

advisors. Suppose we examine this

corporation, however, this investThe average department ment in a
department store is in
a
large amount of its tens of
thousands of items that
total capital funds (usually rangar(? in every day use by millions
mg from 25 to 40% of total funds) 0f
people rather than one, or just
invested in prime Grade A downa few items
of the same
thought.
store

hazards

mer¬

the

as

an

institution

manufacturers

of

and

lines

appear

on

the

they represent

balance
an

sheet

but

unrecorded

as¬

set of great value.

(4)

is

inherent

individual

an

evolutionary

Some; of

but

rather

to

increased

the

all

op-

department

not

well be

may

yourselves

analysts.

The

same can

Both

as

general

to loca-

ates

automatically

substantial

a

cash

whether

viewed

from

the

stand-

Remember that this latter plant
or even the
product it is designed
to produce may well be started on

of adversity as a result
accompanying inventory liqui¬

of

am

and account collection.

quite

convinced

thorough study
convince
of

on

managed

store company

Other Fundamental Strengths

/In extolling the

partment

store

,

virtues oi

securities

.

de¬

securities

department

entitled to

are

department

type "multiplier" of
relative high rank.
I urge you
to give this matter some serious

thought.
Department Store Maturity
I

would

like

to

examine

the road toward obsolescence before tomorrow morning by laboratory research or technological de-

velopment. On the other hand, distnbution

to

consumers

will

con-

balance

sheet

beneficial
tion"

items,

results

an

as

investment I would like to empha¬
size also that:

this past record are not unrelated
to
the
erroneous

factor just discussed. Here we are
faced not only with the question
of the accuracy of the

comments

the

-"multiplieir"

record, but
and latter I have little in the
way also with the validity of the con¬
goods
of
specific comment. The "timing" clusions reached in their inter¬
to consumers is no fad,
fancy, or
factor is one on which you
pretations.
As
spe¬
practising
or
temporary thing.f It will continue
cialize.
I
as
may
approach it, at former statistical analysts or re¬
long as consumers consume.
least
by inference, in my later searchers, each of us appreciates
The
principle
of
specialization
,

■'

(1) Distributing

consumer

from which our economy

gains its
force dictates that
every advancement in the field of
production be matched with in¬
creased
responsibilities and op¬
portunities in the distribution of
great

driving

On

plier"

for

of proper

particular

a

an
industry is not
subject for this meeting

derstand

it.

I

would

that

a

The

"multi¬

company

within

comment

that which has been produced.

operations.

latter question

a proper

I

as

un¬

just like to

influ¬

strongly

encing factor should be an ap¬
(2) While there is some varia¬
praisal of the relative effective¬
tion in the physical quantities of
ness
of the company's manage¬
consumer goods distributed as beI

ment.

tween gOod and bad times, this
variation is not great in the lines
making up the bulk of department
store merchandise: Sales declines

past
of

would

earnings

value

future

past

only

like

at

add

that

performances are
an indicator of

as

possibilities.

record

to

A

favorable

variance

with

ever

present

overlooking
oftentimes

at

statistics.

intimate

department

something

experience in the

store

to

and trend of

field

The

may

we

thinking in these

customers

department store industry

well be classified

industry.

industry

as a

do

of

lack

not

shut

down

because

of orders.

such

as

and

not

long

as

there

particular company within

(3) While department stores
erate in an open and

petitive market,

op¬

an

in¬

highly com¬
of the ad-

many

wholl.y

Taking the securities of depart¬
store companies in general,

ment

it

vantages that other forms of busi-

tages and disadvantages.

is my belief that the past

"In¬

dustry Multipliers" have not re¬
ness could obtain only by monopolistic practices are inherent in a flected properly the many inher-

stote

either.

industry

lowing

the

The
was

This announcement is neither

born just fol¬

Civil War.

tical as to assume that consumers

stop consuming, this department store physical plant is so
located and so designed as to lend

readily

to

conversion

for

Another large part of the

de-

other uses.

address by
Mid-West
Forum

Analysts

Mr.
of

Puckett at the
Investment

the

Society of Chicago,
ID., January 20. 1953.




Chicago,

offer to sell

the

Continued

on

a

solicitation of any offer to buy securities.

securities

and

the business of the

Company.

$25,000,000

The May

Department Stores Company

3t4% Sinking Fund Debentures
February 1, 1978

the

Price 100%

department

store carries great strength.

(and accrued interest from February 1, 1953)

continue to benefit from that pa-

Upon request,

tronage

from any Underwriter who may

has

nor

even,

ceased

the loss of

for

to
an

a

time, after he

deserve

it.

a copy

of the Prospectus

may

be obtained within

any

State

regularly distribute it within such State.

Also,

individual customer

sizable group of them
cannot produce an immediate cri¬

or

even

sis

for

a

a

department store

com¬

pany.

Goldman, Sachs & Co.

Flexibility
Closely related to this principle
of "diversification" is that of flex-

February 10, 1953.

It had

rapid growth in the quarter

The offering is made only by means of the Prospectus, which describes

are

would

an

It is not

department

"diversifica-

the

neces¬

a

dustry.

Habpeople its, and this particularly includes
to consume. A sizable amount
of shopping
habits, are not broken
this distribution will take
place suddenly.
Once a retailer has
where the consumers are—downgained the consumer as an estabtown. Even if one were so
skep- lished customer, that retailer will
as

mature

I, of course, refer to the

sarily to the individual companies
department stores even in deep
more
recent
unfavorable, unex- therein. I believe it is important
depressions result primarily from
plainable trend may prove to be that this
declines of price levels rather than
maturity factor be recog¬
disastrous if permitted to dictate
nized by the analyst as maturity
physical quantities.
Department a
relatively high multiplier for a carries within itself both advan¬
stores
of

The very number
of

re¬

»

the

find

add

may

knowledge

your

spects.
-

of

and

determining factor in
an
interpretation of
Perhaps
my

arriving
general
more

likelihood

pertinent

some

working for the retailer in

other respects.
of

of

from

with

you some of the

stores

by earnings,
but by
the.
"multiplier."
This multiplier not
only varies by time but by indus¬
tries and by companies within the
industry.1 As to both the former

Due
apart

an

investment

history of the de¬
have partment, store industry and take
of these
a
look
at
its
current status. Only
merits, why are they
reflected in the security mar¬ by so
doing, can we properly eval¬
if

only

retailer,
and

a

part will

your

that the

you

well

a

I

that

a good question and., uate the future and it is
only the
that must anci should be faced. ? future that
really matters. I also
Security prices are influenced not. surmise that misinterpretations of

is

Separate

cre¬

throw-Off

in times

one

category and often of highly limited market appeal. Again, our old
ings thereon, this real estate ap- friend and
protector "diversificaproaches the ultimate in the way tion" is
by our side. Another facof
fundamental
soundness, tor, equally protective in
nature,
the fact that there is
seldom,
point of security of principal or if
any> reas0n fot a department
assured continuity of income. Const0re to be committed for invensider the merits of this type of
tory beyond a 90-day period. In,
physical plant investment in con- addition, there is
always a "time
trast with a plant located on some
lag" between conditions as they
railroad siding or waterfront deexist in the wholesale and con¬
signed and equipped to produce sumer markets
which, within itone specific product.
self, is an effective cushion for the

•

to the "built-in" financial
control
of the department store

,

time,

and the

be said in

regard

say¬

this

at

appreciated properly by

investor, his advisors

kets?" This is

*

1

you

the

dation

Diversification

within

not been

of structure which

dictates.

tion and the character of the build-

itself

of

its product

vary

eni

has

town real estate.

tmue

brands

cumulative effects

merchandise it distributes do not

store because of its inherent'flexi¬

aver¬

payment;

double or triple this amount even1
though such accounts are secured
by the power to repossess the

individ-

as-

balance

store

changes in other respects. Tech¬ ing to
nological advancement offers no "Well

prac-

of the characteristics of loss ratio of less than one-half of
we have superim1%. Also, this accounts receivable
posed much of which we believe investment of a department store
sess

can

consumer

worst, portunities,

spreading of the risk
ually owned and operated depart- through
diversification
almost

ment stores and

of

can¬

department store
A department store is
a

sis with only natural

seldom

60-day basis. Even the

a

age

pr

man¬

risk

nominal,

The

.

$50. Consequently, the in¬

dividual
no

established

ment

tice, the investment in regular
bility.
charge accounts is turned into cash

our

'

accounts

This

natu¬

department
as
store.
When
a
single company
Physical owns a number of
department
plant, location,, organization prin-' stores well
diversified as to ap¬
ciples and techniques of the de- peal, size and
geographic location,.
partment store require only minor we find
the protective influence
readjustments as we move from of
diversification carried to a truly
product to product.
Also, this superlative degree.
movement is gradual and the real
The Market
change is usually in sales empha-.
Multiplier
the

working
balance on

average

charge

exceeds

primarily to
th

The

happen to

a

many, many million of dollars
of past
advertising of the depart¬

themselves,

agement

"diversification"

us.

trends

consumer—whatever they may be.
alert department store man¬

partment store company's capital
poration do not recognise that the (usually ranging,from one-quarcompany
can
be
classified
as ter
to one-third)
is invested in
either a department store company banking—customers' accounts reor
a
chain
ceivable. Again, we find our old
store

and

An

subject to wide fluctuations. Forecasts favorable depart-'
ment store operations an 1953.

While

well

company.
a distributive mechanism
equipped
to fill the needs and wants of the

demand for most goods. Points out department store securities
because of their maturity have become stable investments, and
not

habits

the

domi¬

virtues oi the
industry.
The
desirable factors of diversifica¬
of consumer
shopping tion, flexibility and assured con¬
and selling franchises
of tinuity of fundamental
need have

of

not

em¬

as

that

particular
companies to oblivion.

consumer

run,

department store

chandise.

those

Prominent retailing executive, in discussing investment merits
of securities of department stores, stresses
advantages of their

established, well
result

pinnacle of success, only to find
reversed

Chairman of the Board, Allied Stores Corporation

diversification and flexibility in

nant

companies that have rid-' ral

den short-term and intermediate-

As Investments

phasizes

well

9

Lehman Brothers

a

cen-

page

30

10

The Commercial and Financial Chronicle,.

(682)

slash

undoubtedly
the

Problems of Tins! Investments

defense

It is a serious
question, however, if military and
other far flung and possibly com¬
mitted international expenditures
with respect to which the Presi¬
dent, in commenting on accumulated obligations of the Federal
tank,

In 1953
By ROLAND C. BEHRENS*

St. Louis, Mo.

Vice-president, St. Louis Trust Company,
/

problems which portfolio

Midwest Trust officer, in outlining

ties,

in

from

econ¬

an

of inflation, the recent years
were
particularly

omy

which

of

work

sors

one

principles and sound money, pre¬
sents much food for thougnt by
those

The

investments.

Administration

new

there

remoulding

In

our

political econ¬

the lines which made

along

omy
our

faces

difficult problems for which
will
be no easy solutions

many

in

the manage¬

with

charged

ment of trust

country great.
addition to certain

tangible

the
portfolio
manager
must take into consideration psy¬
factors,

intangible ones.
a
material
change in the mental attitude of
and

chological

the

Since

election,

readily

is

leaders

business

ap¬

For a number of years
various
restrictions,
price
and
material
controls, labor rulings,
parent.

and

high

taxes

de¬

almost

had

stroyed initiative, and there was
little incentive to risk capital. The
action of the stock market in
cent

weeks

roll."

Budget
doubt

Without

of

control

gov¬

spending is uppermost
in the minds of Federal officials
ernmental

20

Military (60% )
(13%—

International

Interest

(7% )
Veterans (5%)

Natural

Social

—

resources

&

2.5

6.3

6.3

4.2

4.4

3.2

3.5

-~L

2.7

communication

1.6

Agricultural
General

48.0

10.8

—

has

part of our
Without

to

the

&

9.0

1.5

housing—

labor—

■.,

73.7

85.4

Predicated
these

on

figures

dicate

estimated

would

receipts,
to in¬

seem

cash deficit for

a

fiscal

rent

year

of

the

the

increase in

of

prophet,

a

we

manufacturer
smart
a

guy

trend

lets

the

Recently stated, "A
does not try to buck
tries

He

trend.

the

address

anticipate

to

with

ride

and

economists

and

it. He
profes¬

Behrens at the
sponsored
by the
American JJankers Association,
ISfew York City. Feb. 10, 1953.
♦An

Mid-Winter

Taxes,

as

cur¬

$3.7

Personal Income

a

prominent automobile reduction

A

trends.

suppose

by

Trust

Mr.

Conference,

and
on

in

1,

Treasury

an

annually.

familiar,
military

Normal

Corporate

Sur-taxes

Jan.

from

52%

to

47%

1954~ would cost the
estimated $2.0 billion

President
by

reason

career,

Eisenhower,
of his long

with the procliv¬

ity of the Armed Forces for pad¬
ding

military

requirements,

show

at

told

time to venture far

no

examination: We do offer

an

im-

You remember that Wilkins Mc^
Cawb.er's trouble was his habit of

spending 20 pounds and one shillnag of his 20 pounds income. And'
parts: Con- while "seductive" which we have
length

mense

in

or

its

of

one

sales

sumer

credit

be

just quoted is too harsh

an

be perfectly fair

to

seems

ognize

that

a

word-

must

we

rec¬

instalment

credit/
propriate part called by "Fortune" magazine refor us to con- cently the "pprsuasive element" in
sider here to- distribution,
does
occasionally

seemed'

ap-

because cause a few to spend more than
they should. But very few—the

.c'ay

when credit is
P*ul M. Millians

fur-

to

used

testimony of

experience

and

the

redyce

our

revenues."

New

—

handled

Deals

will

.

clearly

indicates an

intention; of

President .Eisenhower to cultivate
labor for

the

future.

credit,

on

not at jority wno buy on credit are men

or

be jn^0 trouble when people use con-

and

Durkin

as

under
—

done

all, let us stop long enough to ex- and women of moral strength and
% amine the popular notion that in- courag;e, and they will "do withthe dividuals and
the
economy
get out" if possession means going

the "inappointment V of
Mr.
Secretary
of < Labor

carefully

credible"

must be

.

militant

so

Fair

and

1

®r

.

Labor

•

ther consumer

checked, the tax burden that

SUmer

sales credit. Then we

shall

topic

an-

nounced

Market!
--

Over

for

On

the

to

closer

m0Ve

discussion—"To

our

Credit."

Not all shrewd financiers are in
finance —or Washington.
There
are millions of them in American

credit homes, working, conserving, plan-

the years consumer

It probably —debt—has

into debt beyond their ability to
pay.

of ning, toiling into the night to keep
be said that labor's reaction considerable verbal assault and the family budget in balance,
Election will manifest it- battery.
Good spending, then, is one reaself
unconsciously in some inCharles
Dickens
tells
us
in son for the excellent debt record
crease
in worker efficiency and "David
Copperfield" how Wilkins of consumer sales credit. Good
production, equivalent to
some McCawber often found himself in "lending" is the other: Modern
lessening of the labor burden. u • a debtor's prison, and on one oc- credit management, trained and.

'the .victim

been

may

the

to

when

casion

Interest

7^

him with a sense of dedication to the

visited

David

McCawber proclaimed job of sound credit sales promoprinciple. that misery tion; to helping customers with,
emphasized by politicians in their follows debt. Descending in -his- their decisions so that credit will,
efforts to stimulate business, in
f0ry, and apparently as a thought be a constructive force in family
periods of reduced industrial acOVer
from
the fiction
of welfare and not a "misery"; credit"
tivity, have attracted a great deal Dickens, a solemn-visaged evan- management trained to protect
of attention in financial circles,
genSf from Babson Park warned credit from dead-beats and a
Interest

Continued

can

there

rates, frequently

on

over-

page

40

Mr.

farrous

few years ago that instalment fringe , .percentage
is an important factor in would misuse it.

a

of those who

credit

making people unhappy..;And as, " No! Consumer debt is.not really
late as August of this year—but a bad word,
two months ago—a national busi'
ness
magazine featuring "TwoInstalment Credit Inflationary.
Line Editorials"rand ^'Thoughts on
♦ On the
question of instalment
the Business of s Life" echoed that credit as an inflationary force and

Equipment Trust Certificates
(Philadelphia Plan)
to

There is
with

three conclusions,

statistics of all consumer credit
saies it implements all distribution, prove
overwhelmingly that the
today stiiles initiative can ,and
shall make no special plea great majority of those who buy'
much be eased.
for credit, for that would be un- / on time are }not improvident and
"Until we can determine the ex- worthy of your invitation to come careless
McCawbers.
With this
tent to which expenditures can be here. However, in the interests of majority "Wants" and "Needs" arc
reduced, it would not be wise to a growing volume of business that not things in themselves; the mation

Equipment Trust, Series EE

annually February 20, 1954

that

credit

consumer

and harm the higher possibilities
for credit sales development,

^o

consumer

one

Concludes
expand.

who have a:e<dit. to employ regret
them, as you in distribution must
regret them, because they hinder

must either be

succeed in bring¬

we can

International-Great Northern Railroad

mature

is

the situation

$3,000,000

To

dealer

the

Feb. 2nd: "Reduction
be justified only as

•

3V*%

the

ing the budget under control. As
the budget is balanced and infla-

f

&

on

taxes will

of

from

dealer,

to

have summed up

we

1.3

1.1

result of the Korean
examine a few basic facts in our War, estimated to produce $2.5
effort
to
anticipate
economic ffiillion, expires Dec. 15, 1953. In
trends in
1953, taking our cue addition certain Excise Taxes es¬
from industry which has. become timated to produce $2.0 billion
increasingly proficient at sensing expire March 31, 1954 while the
role

a

a^d dim the op¬

Eisenhower

President
to

much

assume

uttered

He

warning

succinctly

of Law, variously estimated to pro¬
duce $2.5 to $3.5 billion this fiscal
economic system.
year, expires June 30, 1953 while

trying

full production and optimum profit.
must be free to

^

permanent

a

cost.

consumer

born."

his State of the Union address in¬

inflation

Points out consumer income regulates
credit, and its value to society exceeds its
Calls attention to importance of credit
keeping up

volume of

portunities of generations yet un- -

revival of the free

become

nothing to income."

descrip¬

...

relief."

to

credit

consumer

denies instalment credit is

of Virginia reThe gtory of credit in the com_
Fedeial taxes a
plete cycje 0f distribution from
imposing a cruel burden ori b t
the manufacturer to the distribindustry and business
bo h are
utor) lrom the distributor to the
entitled

on

''good lending," instalment credit has an excellent record, and
inflationary, since "credit can add

ex¬

liabili¬

Byrd

Senator

1.5

government

Education

Com.

decrys attacks

experience shows very few «pend more than they
should because of consumer credit sales. Asserts, through
says

1954.

til

blight the hopes

welfare

Security,

health

&

Trans.

51.2

gives some evidence,

of

years

and

?

against cutting taxes,
and the taxpayer. The budget, in¬ however, until we have reduced
herited by President Eisenhower, Federal expenditures to balance
can
be summarized
roughly as the budget, eliminated the neces¬
follows:
sity of deficit spending, and in¬
Estimated
creasing the debt, which Speaker
Budget
Actual
Martin recently described as ("a
1952-53
Expends.
(Billions of $)
staggering
burden
of
debt
to

enterprise spirit. Apparently cap¬ dicated the current year's deficit
tains
of
industry
will not be at $5.9 billion. Such a deficit, par¬
branded as criminals for thinking ticularly
a
"cash" one, hardly
in terms of net profits.
presents a logical basis for tax
It will also be necessary to try relief. All of us are aware that
to evaluate the consequences of the
present Excess Profits Tax
which

;

cently stated,

billion,
although President Eisenhower in

least, of a

at

re¬

it.

buck

to

don't have to meet a pay¬

They

marked by

profligate spending, to
dedicated to sound business

how

out

Baltimore, Maryland

and worthwhile tax;,
well have to wait un-

year

Vice-President, Commercial Credit Company

.

Credit* company executive

can

fiscal

,

"

extensive

and

beyond

almost

be

By PALL M. MILLIANS*
.

be effectively controlled i"
the remaining months of this

tion,"

well as modest rise in
probable high level dividend payments.

numerous

so

to

as

is

Thursday, February 12, 1953

.

To Market! On Credit

-

payments,

amount

clusive of large contingent

relief may

transition

The

this

"Even

said:

with favorable business prospects, as
interest rates and

plane.

or

Government for future

1953, says change from an inflationary
economy will require taking into consideration psychological
as well as tangible factors.
Foresees substantial requirements
for industrial construction and municipal improvements along
must face in

managers

billions from *
without the
a single gun,

program

production of

loss of

.

>

196S, inclusive

1

"trap" for prosperity:
'
Belief that instalment credit, is
r
Less than a quarter of a century inflationary is rooted in the idea
ago banking philosophy was op- that use of credit puts more pur¬
posed to personal debt. And at the chasing power into the hands of
high banking level of the Federal consumers than they otherwise
Reserve Board, a former Chair- would
have—in plainer words,
man
speaking before the House that the average urban family inBanking and Currency Committee come of $363 a month could be
a few months ago said, in effect,
increased if the family unit would"
creditris seductive."

that
To be

guaranteed unconditionally as to payment oj principal and dividends by
Guy A. Thompson as Railroad Trustee oj the property oj International-Great
Northern Railroad Company, but not
individually

debt isP poison.

"Personal

ment

•

the

free

of

use

Instal-

.

those

who

consumer

credit

have

the public is uninterested,

.

,

credit is something important only
to

a

sell;

to

only

buy

logical
when

credit. But how il-'

on

such

reasoning

reduce

we

it

becomes
single-

to

a

labor is transactiont For example, an automoble is bought on time; obvi-J
ously the down payment and the

uninterested, and most of business

Priced

cares

to

yield 2.50%

to 3.375%,

according

to

maturity

Issuance
7

ne

aft J sale
of these Certificates are subject to authorization by the Interstate Commerce Commissitsn.
Offering Circular may be obtainea in any state in which this announcement is circulated from only
undersigned and other dealers as may lawfully offer these securities in such state.

such of the

HALSEY, STUART A CO. INC.

As

FREEMAN & COMPANY

THE ILLINOIS COMPANY

WNL £. POLLOCK 4 CO., INC.

Feb-uary A,




McMASTER HUTCHINSON A CQ

i

v

.

trouble for the economy,

economists, credit controllers, politicians,

others

and

declare

with

emphasis and definiteness that instalment credit is inflationary and
a grave trap for1 prosperity.
*

....

"

hionthly payments must be made
®r out of sayings or from in-*
c°me h'?rn""some other source—•

the credit used in the transaction
certainly added nothing to purchasing power.
*
An" a.s ** 1S with the individual
transaction, so it is with the ag_

.

-

gi,0o'afa

honor

areas
aieas

•An

Boston
ton,

the

honesty

thev

because

such

of

examine

We should

opinions:
them

;

to

though there is ah extreme range
of dissent and agreement, many

We
P. W. PRESSPRICH A. CO.

little about it.

reflect

laree

oT^im^understanding
husunaer^tanaing.
•

address

hy

Conference

Mass.

,

Mr." Millians
on

at

Distribution,
.

We
w
the'

s represent not purchasing
?ower but a transfer of pu.rchasmg.

power

Other

Bos^

from

groups:

the

one

„

,

,

group

COllSUmeT
j

Continued

_

to

debt"

_

071 page

0 —

37

Volume 177

Number 5194

.

.

The Commercial and Financial Chronicle

.

(683)

When

What We See in Business

goods

best attended session was that on
'Ihow to sell houses'—not 1>QW to
build them. They re expecting a

but the best guess

•

"

By BUREN H, McCORMACK*

Executive Editor, "Wall Street Journal"

v'

they had their annual convenfidsn. recently hv Chicago, the

•

,

good year in 1953; in

Mr. McCormack, though
stating business is generally very
good, points out several industries, such as shipping and watch
making, are suffering from impact of foreign competition. Sees

k

,

-

there will be greater competition for the"
consumer's

I

have

been

hrief report

asked

to

give

retailers, wholesalers, and

a

Perhaps the best way
get into that subject would be
10

have

at

some

lines
i

n

look

a

ex-

"Bos-

Summer

Show

duces
u

i

y

"Carpet

Fac-

t

Hum

i

o r

e s

H.

Ago'

McCormack

'Lumber

y

Slump;
Output 6 0 %

other

Above

a very

Price
*iVV

Year

-

of

terrific show

movie-

attendance, w h ic h has
trended downward in recent years,

(

we ever

had."

Even when business activity is

troubles.

all

ing

in

main

-

rough business

js competition from
foreign shipping lines, which have
much lower pay scales and conreason

>•/

competition,
'

-fof

arise

output,

the rate of

-

much

higher.

A

demand for goods or services. <•'

would

be

well

below

the

of

gain.test,

one

more

a very

have

Index

business
it's

going

for

credit

to

answer

that

year

of

bil¬

was.

New

look

at.

are

116,000,000 tons

York

Pipe

Lines Are

Di¬

rector

of

its

New

York

news

we

at

52.

the

public

lations

of

re¬

staff

past

World

War

tional Board

the

the

agent

time

that

Robert

Na¬

there

had

reached-

the

he

F.

and

has

been

.

prior

and

to

During

the

war

Mediterranean

the

heavy bomber
officer.

a

<l

pilot

u

j

146,

Schmidt, Poole Co.

was

V

just

Admits Partner

PHILADELPHIA,

down¬
now.

Pa.

—

Schmidt, Poole & Co.,; 123 South
Broad

Street,

members

the

of

Philadelphia-Baltimore Stock Ex¬

change,
Sapp

stern test in the

a

as

in

.

very gopd chance that the gov¬
ernment's farm price support pro¬

will have
months ahead.

FBI

Before

special

operations

-

February, 1951. Since

trend

the

Carroll

associated with the New

served

theatre

out.

upswing
high of

record

a

for

was

York ."Times."

climbing from that

Korean War broke

gram

;

since

Doremus from

a-

Filled

agency's

July, 1948, Mr.
Carroll joined

modities

en-

member

of the

of

By

ad¬

depart¬

A

staff

Many commodities are included
this index, but the farm com¬
weigh heavily.
There's

•.

City,

ment.

the

ward again to around 165
in

that

announce

has

been

Allen

admitted

general partner in the

,

D,

as

firm

specializing in municipals,

,

This

announcement

is not

:

an

The

offer to sell

or a

solicitation of an offer to'buy these securities.

offering is made only by the Prospectus.

*

......

- •

>

a

-

.

.

6,700,000 in 1950."

■

Business Generally Is Good
Almost all business in this

try

right

however,

now,

«.

More Competition for Consumer's
Dollar .

coun-

is

very

Business

was

at

high

a

this country back

level

Nov.

on

day before the election. But what
happened on Nov. 4 brought ar
psychological uplift that has been
transplanted into increased buying of goods.
This

psychological shift has
taken place without any change
in the basic economic picture. But
there is a belief among the people
that

less
a

we

will have

efficient,

more

dealers around the country to see
what they thought of the prospect

in

3, the

of

substantial

a

output.

Most
to

eagerness

sell.

increase

of

them

have

in

But here and there

First Mortgage Pipe Line

to

-

costly government. There is
hope that spending will be

s_

and

taxes

January 1, 1973

Price 101.295% and accrued interest

throats,

that auto dealers

or

;

l'®tmters will literally be

There is cu^mg each other s throats this
a conviction that we will
have less year but ml*uess 15 there 11 be %
interference with, and control of, m01 e competition^mong salesmen
business
' lor the consumer s dollar than at
/
'
*
any
time since the days before
*•
You ana i know, of course; that
worif] war tt
psychology has a good deal to do
XT
;
,
'
with .what happens in business.
our reporters .,
Let's look for a moment at what talked to
stoie cjpgr-^ ..
has occurred since the Korean
;

.cut

Due

January 1, 1953

cutting

,

doubt

,,

real

Dated

now ...
worse. By the mid-

g

Bonds,,4Fs% Series due 1973

found

we

re^s.tance is high right
A
eaoh other

Company

'

;

u.

*

„

.

Tennessee Gas Transmission

*

a different reaction. For
instance,
on® on the west coast said: "Sales

a/.

,

^

auto.

cars

'

/

•

expressed

more

$30,000,000

.

"

good. What's happening,, it seems - At the same time we asked :"
to me,, is that we're riding a wave about the outlook at Detroit, we
of
free
enterprise
enthusiasm, interviewed
a
number
of
auto
V

reduced.

The

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

^

.

T

.

.

.

,

}onf

,

HALSEY, STUART & CO. INC.

department

1

War started on June 25, 1950,
Within a few days after that
event, a scare buying wave began.
Consumers actually began

bolrd-

ing

sugar

and

even

and

tires

and

battertes

They

precautionary

L

ence

This hoarding,
buying, spread
'

^

-

jub lant, mood. Jhey

Post-Christmas Sales,

were better than they expected; m fact, r

Bu

e

10,

1953.

'

"




„.

business

ment

comes

we

cam!

,

f

builders."

L.

SALOMON
F.

BROS. A

HUTZLER

ROTHSCHILD & CO.

A. G. BECKER & CO.
,

GREGORY

C, ALLYN AND COMPANY

BLAIR, ROLLINS A CO.

INCORPORATED

& SON

INCORPORATED

R.

W.

PRESSPRICH

& CO.

!i

INCORPORATED

INCORPORATED

SWISS AMERICAN CORPORATION

F. S. SMITHERS A, CO.

r
•
-

,

home

& CO.

CO.

SHEARSON, HAMMILL&.CO.

hint at stepped-up
the. sales' depart- >,

from

&.

HALLGARTEN

AMERICAN SECURITIES CORPORATION
A.

Cle velan d

mehchant put it. . Competition is
or k*enfr> SQ W? .will put m more
t0.ffort
promoting our rnerchandpe
to get all the

afet8M^'u^r; ¥s.Cor™a«k ,be" ? Still another,
of Ae Americi" Binklr*
horsepowe? W

tion, Feb

WERTHEIM

ahove the yeai before, and

r|f ^ey w«e rumrfn* well .above

membered the shortages of World
War II and didn't want to get

caught again.

-

'

BEAR, STEARNS &, CO.

;*

STROUD

COMPANY

INCORPORATED

February 10, 1953.

WM.

E.

POLLOCK & CO.,

a

firm. Mr.

Sapp has been associated with the

Despite these few caution signs

blinking along the business road,

record

a

relations firm,

Fire
Underwriters.
September, 1939, our of
Commodity
Futures World Wars II,. he was a

fact

then- the

at

"It's

F.

as

That's

course

over

When

was

215,in

over

a year,
we

in

sharp, to

big

is

the

Robert

Carroll

$7

had

It

when the

the

was:

appointment

now

downswing to 122 in the middle

From

mo¬

cheerful kind of monotony."

Broadway,

segment of the

trace

stood

of 1949.

and plans

example,

to

in

war

level,

strong.

getting to be

For Doremus in NY

ended, this index
had almost doubled, to a level of
99.
The postwar inflation sent it
up to 175 in late 1947. Then came
a

the

William H. Long, Jr., President
of
Doremus
&
Company,
120

up

big one, that

a

years.

II started

en-

at

moment

that

news

desk

Carroll News Dir.

bank,

homes is $67

on

Dow-Jones

\ The
big question, then, is
production whether 'we're
consuming* these
5,be
5,300,000 figure < '

would mean 23% more new cars'
than were made in 1952, But it

foreign
slumping

find

afraid

very

the

That's

lot

The-total

The

fifteen

1953;

year

be between 5,000,000 and
300,000.
Some think it may

from

from

not

"The

think full

tQQ,-

ought to

Our produc-

is Drobablv

the next few months

steel

passenger cars:>
most conservative prophets

will

sewing machines, have suffered
from imports. But you'll note that
troubles

now

highest level in history

the outlook for

struction costs.1 Several industries,
as the makers of watches and

A

commodity prices

-

such

these

right

0'r 40% greater ihan when
the motor companies. Here is how tered
World War II.
our Detroit reporter "summed -up->

The

seas.

billion.

year.

economy,

a

our

my

were

$24

a

There's

t.hat

of free

wave

terprise enthusiasm.
tion

,

they're particularly happy.
having their • * Another industry that's looking
shipping for a big gain is auto manufdcturfor example, are sail- wg.
Not long ago we ' surveyed

we

I'm

My

eye

billion.

we're

the post-election

The American

companies,

loans

in

lion.

going to stop building
factories; we never will, in a dyliai^iiv
namic I1CC
free enterprise eCUilUIIiy.
economy
mean

These

very high, there are pretty sure to; -so
be some industries

fact,

by

notonous for the reader."

,

makers of dinnerware, by the way,
seen
their, business going
downhill for the past three years
nave

of

dropped

now

of money

outstanding

,

pick-up in

thing to keep an
credit,
particularly

almost

g^gQS

..

May Indicate Another Big Spring that its sales this year will run One of our news
men, just back
For Housing"; "Big Auto
Output 15% above 1952. Another one, in- from Louisville, was
telling me
Worry Some Dealers; .But troducing a new type toaster at' the other
day of the giant new
Many are Happy."
the housewares fair in Chicago re-. General Electric
plants going up
Those are a few samples, picked cently, said his
first, two days' there. In Akron, tire companies
at random, of the kind of business sales there had been
"the greatest are just
beginning to talk about
news we've been
reporting in re-, in history." When, the Associated some wonderful new types of syncent weeks.
What's true of these Glass and Pottery Manufacturers, thetic
rubber
that
will
require
four industries is true of almost closed their
four-day display of new factories and new equipment,
all others, too. I can recall similar Soods in Pittsburgh
recently, one. -'j mentioned a few minutes ago
stories about electric
appliances* of the pottery men exclaimed: that
manufacturing seems to be
furniture,
and
chinaware;
and
.This was the fastest and most
feeling The sharpest impact,from
there has even
a

That

people are bor¬
Consumer credit, as you
know, has been climbing. In¬

15%

Plans

been

see

absorb

have been built in'the past couple: farming.
All of you' are aware,
of years, mostly to-produce- de-: I'm sure, that farm prices have
fense goods3 Much of that job has • been coming down during the past

good year, One big electric
appliance
maker
is
forecasting

•

to

will

matter

a

terials are available once more; in savings and loan, and insurance vertising and public
iac'L th,ere are very few important money has been going into mort- announces the

have said they expect 1953 to be*

v-wovo
Increases

x

A number

group.

ahead

-,

people

that right
mighty good.

clay and remarked: "You
know, almost everywhere we look

been done, ahd there is a general-1 year. Some important farm prod¬
expectation that industrial con-, ucts.; are now selling below the
struction may decline some this government support price level.
them! year.. This, of, course- does not
It might be worthwhile, to take

.

Big
B.

is

.

a year, things have,
been picking up again. They were:
picking up when the free enter-,
prise buying wave hit.
■
.*
/
Manufacturers reflect this psychological spurt more, than any

Again After

period

doubt

other

ing, according to the latest figures,

into high gear. The goods will roll
out this year in huge volume. Ma-

scare

better part of

g";

n

these

As

editor

spurred by
the end of Regulation W last
year.
Total, consumer credit outstand¬

huge de¬
shifting again

wholesalers and retailers adjusted to meet civilian
needs.
You
inventories .downward.
For -the: know of the
many factories

Pro-

Record

Men's Apparel
B

of

waves

are

are

the

stalment

of the

is

•

news-

ample:

two

were

the load

program,

we

no

business looks

rowing.
all

Our

shortages—at least no severe ones.* shortages.
"
So buying in many things, such as
f It's a very remarkable tribute to
textiles, dropped sharply. It took American
industry that it has
about a year to get through that been able to
absorb, the defense
period, while manufacturers and production job and still be able

appear-

paper. For

ton

on

fense

decided there weren't
going to be

head-

our

take

is that

goods

is

there's

pro¬

answer,

Another

-

manu-

sure

are

testing

larger- amount

charges.
happened is this:

no

being filled up;
climbing.
continues, there will be

this

on

/civilian- goods
production
ma¬
chine,. which had to slow down to

until, early in 1951,
psychology changed. People

the

recently

g

in

There

buying

somewhat

they're being

being produced.
is something to watch for.

bigger down-

mean

and

What has

facturers.

Business."
to

persuasion.

moiithly- carrying

%

consumer

"What We See In

on

need

reason, in this case,
builders believe rising

interest rates

;

f

will

a

special

payments

dollar.

If

the

is that the

goods output, but holds "pipelines
of production are
being filled up."
"

fact, building

but

a

Looks for greater

Pipelines

inventories

whether

One

psychological change ending, consumer buying wave, and
points out, although manufacturers look for increased sales,

not.

as

There's

stents recently have been running
about 15%- ahead of a
year ago;

buyers

fast

as

duced.

11

INC.

COURTS & CO.

12

The Commercial and Financial Chronicle

(684)
'

4

■

•

If C

11 Aft

,

AlllilAil

lIVll
m

-

irlVVft

gm

-

.

WlftvlAll|w

esting sidelight on the rate ques- has been obtained which we betion* A savin£s and loan associa- lieve
accurately - reflects the
tion jn Chicago payS a lower rate thinking of the entire population,
than its competitors. Yet is it enIt is easy to form a one-sided
joying the fastest rate of growth opinion. We in banking have seert

■ «•

VVIIIJrWMUVM

By JOHN B. MACK, JR.*

City

in

Public relations

specialist, in calling attention to serious com-

lists

I.erZ.Utu..

n\

and Loan
of successfully combatting it:

means

as

.a.nlaiinn

ss.el

,

and (3) merefcandizbest place for savings.

as

In
is

on

of savings and loan competi-

lem

l">n\

There^is
a
a lot of hard

Of

it

course

be

would

eliminate

j

if

nice

competi^ would also be nice if we

could

we

could

and

Those

business.

if

but

this

tackle

4

to

are

created-the Federal Savings
Loan

in

problem

right manner, we'll stop wishing
and

get down fo
fundamentals.
For
this

dreaming

basic

and

__

It

today.

here

is

uaunivll3l

a

they had

hieher

a

rate

subject

this

let

me

mkn

foresaw

what

the

after

chandise their services

And

thev

devTated

from

that

attract

the advantages
advantages of
of the
the

place for savings.

associations

loan

Legislation alone, education
jicj or merchandising alone will
not solve our Problem, It requires

air

three, intelligently and vigor-

important '"But"
-

!

of
equally
are

A

stop and ask my^

did

get ourselves

we

as

They stress rate, convenjent location, safety, and the
interest of the ^stituti^ in helplr
people get ahead.
■
|.be

hnm

6qU.,1

^nai» ine rest 1S reiailveiy sunpie.

savings and
a
place for

savjngs

s
Rut

ously applied.

"How

+V10

VionL-o*?

a

I

ro

trading blow for blow with
t

merchandising appeals? Ii
have just finished looking through
Su
institution is competing some 3qq bank ads on savings. I
v
t1! u n1 savings lead®r" find that at least 90% of them
f*11?'
^ hardlY seems possible. sfress |be "idea» 0f saving money,
But there are the facts, already
,as
str0ng

might

with

the

Savings

Division,
manual

is

wil1

lt

,

,

.

stated to you by previous speakers

°nTth!1P~
i
'•
In the 166 years of
our country s
t

-

history

to

prior

the

Deal

New

into

came

L°.W.ef„.I"ZZ',_1.933V.tbf..C°um:
mercial and savings banks
had
between them about

time deposits.

thrift and
o£ a cash

preach

„1VUV11

the

our

competitors skim offbiggerand

bigger portions of the
i_rv-fA

himinpcc

MVJ.X4J

Tf

yji

vn,i

WJll-

average

savings

new

Hnnht

figures

these

U.S.

were no

based

be

I ^yings, and about
an °an aS~

•

^sociatimis m
;

It is

easy

|bank$

to understand why the

followed

educational

'development.
Ithen

was

of saving.
•

low-pressure,

a

approach

•

,

,

.

,,

.

The

to sell

main

people

on

commercial

niv"

bank

has

deposits>

isame

tion

in

position
few

pretty

sell

naturally bought

changed,

and

the

on

travel,
a

of

Ford.

But times

Ford

soon

had

to

fight for markets with other makes
cars.

same

e
period the

increased

$1,600,000.

Take

a

look

at

.

are
are

try

advertising

to

sell you

today.

automo-

on

automobile instead
form
•An

traveling
of

some

of transportation?
address

by

Mr. Mack

it

Does

by

other

Maybe
before

a

the

In




high

stand

in

the

significant

mention

•

,

,

,.

kn„w

,

,

47«k r^nhoned'^oans l^ 3sav'

m^tmned loans,-44% sav-

^ 41 % checkin«;

Th«re is no doubt that we have

an educational job ahead, but it
equally certain that this is not

perfect chan-

a

think

that

the

basic

educational

nel to the majority of savings and job to be done is to define the
loan shareholders because they difference between true" savings
are right in our own bank family,
and
investors, with
are right in our own bank family, and investing.
investing. If
If investors,
with
Another

question; To what de- full knowledge of the facts, choose

Another question: To what de- full knowledge of the facts, choose

savingk and loan in- ^°J?"i^®^Yjnto^shares^to obtain

gree are

accurate than

more

4i

i-ii

of the public as

plan of

whole:

a

liquid cash reserve

a

tk>nisthinking
it is a bank and that
a

he

depositor, real harm has

been done to him—and to

W.h0...°^nS_the savlngs and loan
aS^CJ,atI0nS'
.

,

know the nature Of their

60%

for

knowledge need is

Their

group.

ship is much

us.

Our

indicates that many of"
those, going to S & L's have no
business doing so. They are savers

survey

rathpr than

misled into deal-

are

and

1951

total

commercial

d

same

period

increased

*

9

bllbon-

over

quite familiar to
fact that
field of

ened.

our

but

you,

bear repeating to

that

by

dramatize

leadership

savings

is

being

in

are

they
the
the

threat-

And the amazing thing is
our

competitors

hold

only

one trump card—rate of dividend

—while
entire

we

deck.

we need

hold the rest of the
To

put

it

must

to learn how to sell.

merchandise

our

dividends, and would all come
to the banks once

flocking back

w.

—-

—_

This just
thinking.

light.

the
It

wishful

is

loan

and

invp«;tnr«;

Fnr

pvam.

real estate;

and

&

customers

L's

areH&fer

and

56%

comes

must be

about

«?aid

.

.

,

.

^

..

,

.

.

...

Th,eJ'b'rd leg of the tnP°d tha'

we

should erect

in

support of bank

savingSj in additi0n to education

merchandising, Certainly
is legislation
°Pinl°n» but and
(and regulation)
the

mighty important when you think ^llKli„
^
public should insist
that savings
of educating people about the dif- and loan associations as well as
fer®nce between deposits and in- banks adhere to the law, that they
vestments, etc.

should both advertise ethically.
65% think there might come Savings and loans should not repanother time when real estate resent themselves to be banks or
would be frozen. It is interesting to render banking services.
to note that they continue their
jf you agree wfth me that the
of them would stay relationship in spite of this. The solution lies in this three-way

a

facts

true

are

^

great many

of

misunderstad

Don't

strongly for doing
lic

education

on

should

face

we

realize

that

a

I

me.

am

job of pub¬
points, but

these

even

the

associations

»i

that

.I

our

<

.

person

not

would

competition.
i

T

this point I
we

we

have

a

u

great

about savings, and

deal

feeling
stands

general confidence

a

insurance

to

that
behind

Cross

and

the

institutions.

l_
analyses of

The

(i)

apathetic

public

toward

the 62 ques-

in

more

what people know

why they act

dising,
course

islation.

Philadelphia,

has

com-

a

is quite clear.
The
right to proper leg-

Each

bank

on

its

own

is

lts own pustomors and in its own

c?"imunily; and then acting indiy.lduabY> or vnth local coopera-

types of

sav-

inciifn
bon> banks will see that the geninstitu'
°
tion. They have come to accept era^ public becomes informed on
both banks and savings and loan all aspects of savings.
associations as reputable, worthi hardly need to add that all
^

^

r

ings and types of savings

search organization of A. J. Wood face-to-face
Co.,

education, merchanlegislation, then the

initiative will sell its own advantages as a place for savings among

.

Ray Dunkerley has pointed out tbe waY ^beY do> ^ban we bave while organizations. Any attempt three
that rafo io
bad at anY
time before. The to discuss technical aspects tends ,
P
A.B.A., through the market re- to bore them. If this is true of
e>
&

of

and

ahead

technical

general

the

program

public has

tions in this survey indicate these
general conclusions:

•

you

general

a

government

the

differences between
11

should tell

information

on

4

due

and

facts

if every

in the country knew the complete
facts about banks and savings and
eliminate

are

reasons

put right where they are.

Let's continue to sell thrift—but

growing body of proof that rate

....

Legislation
..

well

fairly

the

let's sell bank accounts too.

a

savers.
T

aim do/0 saia

^ s are

^^1$
ue.r' Lm.s 1S .LI1xir

real

of them have inunder $4,000. Most of these

important body of information:

S

them are savinvestors. Fur-

many of

not

thermore, 41%

informed
life; and
even if they have misconceptions
and were set straight on the facts,
actually

We

services.

in

Attitudes and opinions form an

DanKs, have
nave an
an f
dealing with banks,

loan

bluntly,

money

Obviously
ers

•

their

of

conviction

a

are

know S & L's invest most

88%

aeanng wun

o

«S^fBtSvlAmerSi BanSf Assoctal ° y paTi °f the storY' We have
tion, Los Angeles, Cat., Feb. 9, 1953.

second

a

idea that they get interest instead

of

At

bile

educational

Any

material should be handled with
*reat care> f°r there is always
Present the possibility that it
coujd actually send business into
the other camp.

,

Savings

idea

h?ve a magi?

m thlfJ era Qf common stocks

an<i inflation.

_

lo

they just

nigniy

are

f\i'y:.•
ing with our competitors — that
Only 25%:of the S & L group
savings and loan customers think consider1
ttt'
safer, 10% think
they are

In the

and

from

—

savi

All he had to do

people

automobile

springs

$1% billion.

auto-

inese

..

62% of the S & L group knows

true facts about banks and savlngs
and loan associations. This
view

the idea

in

evidence that the words dividend

and,

^3 They indicate that our is

,.^e _e
know that earnings
"inform" the Public as to the higher than in banks.

or

so."

Ford

Pir«f

invest their money7 Are they

that

the three-point

saw

the

You'll.i be

......

consider

let's

of

"ain't

the

of

years

Now

point

they

much

Henry

as

mobile business.

•of

has

1950

Once sold, people would

were

.the first

was

In the

average savings and loan associa

I know that these statistics

We

..

depositors, believe they

banks.
l

*S

hiffhihJhhf

fho

frJ
h ghlights. First,
h° ^ t ^ men and w0Jfn

Education

problem

naturally bring their money to the

^

,

+

hearinS about lt soon'

bank time deposits increased by

savings

to

of

Z,_

ho

best formed

the

on

country.

the

around

tba^ people

nnn

Wp V-F

.Savings Bonds, less than $1 bilP

twC°£? t"SSf

vou

methods used bY banks and others on all aspects of their relation-

.

Yes banks so merrilv along sell-

ingthephi^

$24 billion of

There

money to banks. In fact there is

im"p0^tanee
legislation, education, merchan- investments.
•
pte
83%
o£ thosr with
sa^Zs
reser-ve f0r buying a home' f0r ZnnhViteZthZth10whoteanrnhS ^1" k"°W that ^ receive and loan shares stated that their
meeting emergencies, or for build- ™ho be'mve that the whole piob- dividends.
family income was under $6,000.

stress

1933^ banks had ing financial security.

practically no competition in attracting the savings of people,
When

They

,

now

savings

on

u

_

eive

f-niha

/.nmnioio

cnm'mnrv

of fnterfst' dividends, investmeP^'
" ?vould fause sa™gs

vestors informed about the true a higher return, that is their businature of their holdings? Contrary ness. Many bankers advise cus& Mortgage to the beliefs of many bankers, tomers to do just that, but always
preparing a those who have money in S & L with full knowledge of the facts,
development, associations are a fairly well-in- However, if a person whose real

that the A.B.A. PubCouncil,
working

say

Relations

lic

1^1 tbiS

.

nossiblv

can't

hanif°7an lations. We have

«

Methods

savings>

•

.

self;

tho

T

s no evidence that an informatlon camPai*n on the true nature

insurance, peal

forth

vem*s

S„?,vi"fr.ar^ l°han pmmtCrvti0TL^ impo"rtanT"Ts"your determination
(3) Merchandising that will sell
thetank1tolTheoplenas
ttebSt
ads.Tffnd bear doZsavfnes
heavilyand
ol that,d°thetherestjob'
Once, you. have
tbe
bank
aS tne best the
is relatively simple.

^Sometimes I

comj^ete^an^
Sh SS
Now

fdge abou,t savings matters There

...

savings ads published by

score of

the facts

to

as

it

re.ca11 tbe

.

flnd somebody else carrying the
torch of leadership. I believe the

institutions.

ignorance

was
S-5Sngf^ ^ho ^ on .tbe oth.er esteem of Deople eve^where We
lX ^as Slde of the track? Does it surprise esieem 01 people everywhere. We

^ \^tYtie

cni^ifi?Twav« "tlTat

Just recently I gathered several

(2) There is nevertheless broad

public

and loan customers to move their

laments

Rav Dunlfer?ev
booklet ^hout ^5

a

uninformed

how

invJw

t

x

iL oL„t :jorocf

associations

load

to what degree they are

or

uninformed' and
q

*

the benefit of those bankers who also have savings , accounts ...
are pointing,toe finger of blame banks!
at everybody but themselves The;
59% 0f the people with money
over banks message of Ray's booklet was that
s * r;
' In short" "nlfwe in banking got off our
must mer- fats and started to sell, we might
hiehiv
significant

theme.
uicmc.

(2) Education so that the public
will understand the true nature

all

formed

why

hl've b^en mlsin-

thev

of

that at

sav

shortly

intcf^ins

ag0' As

bv

savings

a

Jf

and

and

A,,

advantages

al "eliminate hSte

the competing

of

wavs

that from

happen

came

and

provide for the local financing

and

leaving

one

migbt

interest probably ends.

Some of us have con- .jng jn savings and loan associa-

scratch, in the face of our
entrenched
position in savings,
and; try to convince people that

inequalities.

t)f

i^ast

nn^ont

from

rpgulation

and
.

Before

originally conceived was to offer
opportunity for investment of pri-

they knew that they
t pfdclatinn

/1 y

of

obstaplp

^hers' -and

savjnes

iIV

ingot:

JilK

pur-

institution

new

plan'of action consist-

three-part

f,

as

to

American

sueeesting

The

Vate funds at attractive rates

into the character
people.
At the outset, let me outline the
solution to this problem that I am
and

tory

this

0f

pose

forth-

a

Association.

-Public

dealing with people can overcome

merchandising

and

to

noliries

A new type of institution

picture.

interesting
going

rpiat;ons

and loan man!

was

out

3%

.....

institution;

this

Qf

Something happened back there
1933 that changed the savings

of

are

we

jn

5%

or

competitors

our

dreams;

our

rates

our

raise

put

tjiatv hicf what hanks

And

dises! And that s just what banks
have neglected to do.

work.

requires

are

answer from
was
don't
29%' rate; and (2> The P?°Ple are mi.s~ know." This should be corrected,
14% ^ed bY oiur competitors. A main >•
«ybose wj^ s & L, shares
• 7%- purpose of the A.B.A. survey was bave a higher degree of knowl-

In the words of the Vice-Presi-

dent

both

.

—customers^lie
truTfeasons
4%

Solicitation
Dividend Rate

little but mainly it concentrates
the advantages of one make
over
the others—in apnearonce,

there

simple solution to the prob-

You accept the fact that
all right, and there your

esses.

eluded that this can only be be- tions. The typical
34% cause of two reasons: (1) Higher the general ^blic
*

______

„•

solidtat^r

banking business.

have to a discussion of the offset
versus letterpress printing proc-

and cus- "

of our prospects

many

mon^

,

Institutional prestige

dLone1on \P,anc tbat wi!1 rcflcct credit r'
the

opinion,

personal

my

no

to the institution:

v Advertising

Sa*s a» lhree ,houId b<
to

sur-

people gave for coming and loan associations with their about saving in banks and invest-

^ ^
perSonal recommendation.Z

of the competing institutions;

ing that will sell the bank to people

of new

survey

a

Loans and other business

•

(1)
lepslabon and regulahon ^correct abuses and eliminate
inequalities; (2) education, so that public will understand the
true nature

In

area.

r reasons

an#)

-kn«.«

ravrv.rf

the

customers in 1952, these are the-tomers going over to the savings

petition to banks in savings field of Federal Savings

Associations,

I j*

must

pleted a national personal inter- formative: literature

small savers, than many -bankers view survey. Through scientific mount! I guess the public attitude
seem to think. Here is an intersampling- methods,
information is about the same as you would

'

Attn Lfliitt LOmnetltlOll
John B. Mack, Inc., New York

Thursday, February 12, 1953

. ..

*•

is less important, especially to the

■

1*1 AAI SfkVYYMfC

Vifttl

m

%

'

K

r

.

m

mm

AH'

I

1

the

discussion,

obstacles

that

can

be done, and should be
,

,

,

,

on a bl§b P*ane that will

consider reflect credit on our business of

printed

in- banking.

_

Volume 177

Number 5194

*

v;.

The Commercial and Financial Chronicle

■

(685)

Federal

Federal Reserve and

Home Loan Bank Sys¬
tem, or. both;' Membership in -the

some

former

is still part of your- contract/with

to be too- expen¬

appears

sive for you, and membership in
the latter involves getting-mixed
•

'till

By ALLAN SPROUL*
-

'it

*

up in the public-mind with credit
-institutions having different char¬
acteristics — -credit institutions

"

'

-

President, Federal Reserve Bank of New York

5

t»

which

,

y

Prefacing his remarks by saying that, with the coming

-"

in of

It is

a

System.

Points out

sav-

is

not

the

time

for

lieve

to

try to give you either an ex- general interests in common which
position and defense of past credit we might explore together,
policies or
a
Are Savings Banks an
forecast of
what
ahead.

Anachronism?

lie

may

A new

Savings

banks,

far

so

as

have

meet the

to

mands

only

of

in

threat of

Wash ing ton.
The past is not

buried.

It

can

if
be

ever,

buried.
think

But

making

should

parts
But here you are,

new

in

that

moved into
Allan

New

Sproul

town

and

new

quarters in mid-

Manhattan.

whether 'I

I

don't

know

was

more surprised to
new programs will be in the makbe offered tea and cookies in the
ing. In these circumstances, I have lobby, or to be told that on openno
desire to rake over old con- ing day the bank had
gained more
troversies, nor would I want to than 20,000 new accounts and
complicate the development of more than $1,300,000 in deposits,
new

relationships by trying to That sort of thing, as well as the
anticipate the place and perform- more comprehensive statistics of
ance of credit

policy during com-

ing months and
/It

be

can

with

assurance,

that

Banks

Association,
savings
bank

the

habit continues pretty strong in

Evidently, the passthe Federal Reserve Sy
stem, which bo0k is sti11 he!d in hiSh regard
I have called
independence with- b^ thrifty Americans, even though
in the
Government, not from the Uni.ted States Savings Bonds have
Government, will not be seriously their place, and valiant attempts
challenged. Both the outcome of are made from time to time to
the hearings of the Subcommittee
of the Joint
Committee
on
the

this

Report

matter

views

last

those

of

for the

which

the'

and

year,

who

studied

have

spoken

Administration of the

new

Executive Branch of the Govern-

ment, make this
sure.

And

I

assurance

think

it

can

doubly
also

be

said with assurance that the Fed-

eral Reserve System will

now try
improve its performance in the

to

administration

banking

of "the

country's

^Trt SmaI1 savers into st0ck"
holders.
Despite

there

evidences

the savings and loan associations
on one Slde and the commercial
banks: wlth their time dePosit
facilities, on the other. At best,
-bls 13. a healthy awareness^ of
competition. At worst,-It might
ad you to seek advantages you
,

3ieed"or~f.° indulge in

monetary policy contribute to

of

strength, however, I know you
sometimes feel th^t .your continued ?rowth
threatened by

reserves, and will coh-"dofl..
its attention -on making Pptitive

centrate

.practices

you

.

com-

.should

ay°ld- ? I might -i^tore-a word
imJ pf fdvice without getting caught

eco-

nomic

stability. The war and
mediate postwar phases of intef-

*^^ho .rayidle oi current contromingled ' debt vmanagement aridversies, it would be that so far as
monetary policy are clearly over, possible in a changing world you
And
the. Government
security
]your ~
haracter,
market, after a long period in ?? ■not tryto be^oipg. too much
military service, and then in a tike r y®ur• eoinp^Btors.- I vwould
nursing home, has now shown that f.uess
a 'gooq .deal -of -your
it can take care of itselfwithout
ren/*
comes from-the fact that

have an'-MisJ^tionai^persortintervention; This is^ndt tb-say^y whicb recommends ryou- to
that appropriate, vigorous, and co- * e savm2 Public.
.
.
. j
.
continuous

our

or

frequent

even

ordinated monetary, debt, and fiscal

It would be

emergency.

Federal

Reserve

Bank to lend funds to you in such

The

of

thirteenth

Section

13

of

policies should

not

constitute

^obligations pf the United
interest

at

There is

one worry

petitive situation

in this

which

of

the

And

the

comi¬

perhaps

rates fixed

States,
time

from

mixture

of

in

demand

primary

defense

against

and

commercial

notice

of

ings

invoking

time

banks

might

long

as

"bundle

as

that would

in the "would

do it."

we

depend

your

of

a

just

case

member

who

deal

in

as

bank.

with

the

All

case

of

those

Federal

the

Re¬

Banks, whether members

or

I

place
Fortunately,

to

concerned

that

manent
are

of

matter

a

to

you

may

to

use

in

funds

our

amounts

trying

excessive

long

periods to
augment
their earnings,
or
to
avoid making proper adjustments
/in their own portfolios. More re¬
or

over

cently, the Reserve Bank has dis¬
couraged

refused loans to

or

ber banks when the

principal pu^v

of the loans appeared to be

pose
or

mem¬

admitted to be to increase

was

income' tax exemptipfr under the
excess

profits tax.

T take

w

it, however that
with

not ' concerned

liquidity,

in

vidual

indi¬

of

cases

bank difficulties

Federal

Reserve

Bank

State

and that

drawal

Banking

clause

important

cealed

it appeared

can

would

that its

become

I

don't

an

i±

only

think

ask

for

that

charged

with

duction

the

on

I

matter of

a

savings

with

banker and, indeed, may condition
his continued existence. I refer

ures

of

this

of

power

declined

almost
be

can

most

are

on'

the

Bank

the

as

sub-

jects

for discussion,
and facing
audience,
I
find ' myself
pushed, by a process of natural
selection,
into
discussing some
this

matters

which

may

affect

savings banks.

of my

contacts

cial

System

*

Since most

with

commer-

bankers, and since the major

function
the

are

particularly

of

is

the

out

of

dollar

or

Some

in

habit

life in¬
funds, and sim¬
provisions for old age

savings

accounts,

pension

*An

Annual
Trust

prices of 2%%

average,

means

a

a

year, on

decline in

of ST

run

threatened,

or a

a

serious

a

The

in

of 3%

prices

year

a

in

decline

similar

aged, the needy

This is not too long
a savings span to contemplate, but
such an erosion of savings may be

the

value

lief .in

the

of

Some of it

the

dollar

desirability

saved.

hand

at

for

a

rainy

savings

great

chasing

day

which may be tomorrow-r-a hoard

of

nearly

Thin
..

♦

h neither

announcement
„

i an

offer

to

buy

is made

t

tutr

to

serve Banks. Savings and loan as-

Corporation,

21,

1933.

New
.




York

City,

sociations

Federal
are

can

Home

borrow

Loan

Banks.

orphans; although

i~e

become membere of
Federal

Reserve

from

yOU

the

You

„-n

or

each

In

financial

these

of

of

the dollar :hias

Continued

on

offer

-to

sell

nor

a

page

solicitation of

of tkes&Aecurities.i-Thc offering

only

the Offering Circular,,

,

_

.

*

•*

.•

j

Vermont Industriesj Inc.
Common Stock
Par Value

$1.00

institu¬

cases

the

interest would be served
the stability of the local or

and
the

general
banking
situation
might be preserved, if the threat
prevented

were

from

PRESENT OFFERING:

'

vigorous

These

which

are
a

emergency

Bank

hands,

seeking

help

situations in
with

in

the

the

in

past,
such

'

j

Circular On Request

GEORGE

F.

BREEN

have

I

bc-en discussions

know,

cases *

as

there

to

Underwriter

clean

working

out its problems.

the

Share

savings bank could come

Reserve

There

per

Concession $0,375)

(less Dealers'

counter-action.

the

to

60,000 Shares at $5.00

becoming

actuality, or if the actual de¬
velopment were met by prompt

might

either

System

Prices

contemplate.

upward and the pur¬

power

,

an

in

whether

would

be

20 Pine Street

*

.

60%

years..

have tended

necessity-of having something al¬
ways

30

too

the

or

dollar

in

be ascribed to be¬

can

decline in economic

other

as

a

of

unemployed, and in spite
changes in prices which shrink

public

and

of commercial banks,

by Mr. Sproul at the
Meetings of the Savings Banks
Company and
the
Institutional

well

tions.

cooperative institution you have
created which is meeting here

toda£ Commercial member banks

means

real value

the

would

second

the
the

purchasing power of the dollar of
more than 50% in 30 years.
A rise

possibility of savings

conditions.

or

an

can borrow from the Federal Re-

address

Securities

January

Reserve

administration

A rise

future financial hazards.

and the

have

fundamentally sound sav¬
ings bank caused by local rumors

hand, have to rely largely on your
cwn ^sources and those of the

of

the

reserves

Federal

deposit basis, or

wbat the Pubbc probably bebeves to be a deposit basis, has
fon?e pla2f to gVTe* JTder ^
resort on which to lean in
time of trouble You, on the other
?P

a

wouldn't

of

might be important. One is

case

be

of the public on a

Having ruled them out

a

or

it

-

-

3%

That is

of 2x/2

average.

increase, and

surance,

spite of a growing ,
institutional arrangements
of the

The fig¬
mentioned

public fright about the cur¬
but over a period of years
it would take a considerable nick

upon

care

•

rency,

thrift,
reliance

for the

to

cause

which clings to old ways of

in

unem¬

Mean

frequently

price rise

a

modest

the
to

we

respect to savings.

year

50%.

ascribed

that

say

Well, first let us take a look at
rising prices mean

-

special

the

of

advocates

Savings

what gradually

for

minimum

Prices

Rising

nificance which, nevertheless, has

meaning

a

These

unnecessary

to touch

general sig¬

more

with

with

prices

What

would like

those

are

ployment and maximum employ¬
ment with gradually rising prices,
and that they prefer the latter. ;

Savings

on

and

frankly and honestly

Corroding Influence of Inflation

now

there

must make a choice between stable

management of the Reserve Bank
at some future time.

And

savings
insidious con¬

an

tax. ' Yet

unemployment..

more

that, and I cannot
commit further those
be

their

to continue to have an economy
which works at high levels of pro¬

than

may

They

war.

presently suggest, and more
who believe, that a gradual but
perpetual inflation is the lesser
evil we
must accept if we
are

would be

use

should

or

properly
who

r

to

bank borrowing from the Reserve

run on

this

who

Department

consideration

tapped by

were

would

of the notice of with¬

use

eco-

today.

in

continuance of the

whereby

process

be in continuing consultation with

the

due

do not expect a

difficulties, or general bank¬
ing trouble, or threatened trouble,
the

aberration

an

threat¬

or

ened

aspect of
assume that

I
there are*two* kinds of situations
in which the

savings

you are

we

eco¬

passbook

in

neverthe¬

assume,

less, that either in

that

operations.

'your

that

of

but

case,

day-to-day

would

nor

interest

much

-

politics

our

purchasing

member

which

spectacular amounts because
people believe that the ex¬
perience of the past decade was

that

has

individual

inflation

your

think

I

as

sions the Reserve Bank has taken

by

you

gradual

steps to eliminate

banks which seemed to be

collapse

a

being put forward. This is not

ilar thrifty

rowing

do

do not have

am concerned,
should be con¬
cerned, about the theories of per¬

nonmembers, should understand
that borrowing from the Federal to the
insidious and corroding in ¬
Bank is a privilege, not fluence of inflation
upon the habit
a right. We do have special regard
of saving. It is many
ways refor the liquidity of our commer¬
marKable that the American peo¬
cial
banks, of
course,
because ple have continued to save in such
their demand deposits are so large
large amounts, and in the form
a part of the money supply of the
of dollar savings accounts, during
country. But on numerous occa¬ the period since 1939 in which the
reduce bor¬

savings

as
we

about

But I

think

I

and

Reserve

or

are

entering into our
consideration of all loans. I think

whole bundle of facts at the time

in

facts"

There

country have continued to pile up

the

on

of

is thor¬

men¬

tioned earlier

constructive.

Well,

we

high

be

fast

and

currency

here.

exists, however, it is part

the

assurance

do it"

of

Europe where sav¬
know them hold no

of the dollar.

withdrawal
way

in

nomics—in
particular situations. So
the
power
to
requiie. economics.

you

Now I know that you are not so
much interested in the "can you

of

be just the wrong

deal with

tion of the Board of Governors of
Federal Reserve System, At
present, the posted rate for such
borrowing is 3%.

recognize

we

notice

as

such

a

debauched.

countries

requiring
of savings

withdrawal

And

ject to the review and determina¬
the

emergencies

faf enough

goes

oughly

of savings
recognize that

we

I-can help to dispel.-As Iunderactivity, /which threatens or is
nomic instability.
I believe they stand it, some of you feel that
loss. of public
should and I believe they will, but everyone else, presently in - the accompanied-^, by
confidence
in savings banks, as
I am not going to talk about them business of attracting the savings
a

flation

enough, and

withdrawal

deposits.

by the Federal Reserve Bank Sub¬

serve

Savings

suggest

years.

said

the

however, that the independence of these parts.

Economic

or

have

records; each month
the amount of your deposits
and the number of your
deposi¬
tors, I dropped in, last month, at
a
savings bank which had just

I

remains

state.

You

of the country.

will not lie in

methods

then

and

emergency

.

can

we

sure

de¬

Federal
Reserve ,Act permits
a
begun to
Federal Reserve Bank to make a
succumb years ago to the kind of
loan .to
a
savings bank on its
department store banking which
promissory note, secured by direct
has developed in most other
ism,

at

seldom,

of

for the

circumstances.

anachron¬

withdrawal

depositors,

cases

paragraph

over

notice

of

persisted in this part of the United

taken

den.; financial

time deposits in commercial banks
makes .for difficulties in requiring

notice

only kind of borrow¬
have in mind is borrow¬

you

States, are, of course,

an

con¬

unforeseen;

hazards of daily life and the sud¬

their savings to you. We recognizfe
that the mixture of demand and

ing
ing

Administra¬

jiist

which'

this possibility in committing

nore

cerned—the

tion

has

necessity under
rightly* I be¬
borrowing from

law—and

possible

t

they

as

use ;• with which to meet the

you

depositors.. - We - recognize human existence. These are habits
that custom and usage have
pretty" and beliefs not easily shaken, al¬
well habituated the public to ig¬
though they carl be shaken if in¬

deposits.

that of

the Federal Reserve Bank is

this is not wholly familiar territory. But yw and I have some

me

Federal Reserve

assume

present

dollar stable.
I think you will
agree with me

that

withdrawal

of

your:

deposits

.

I

tion, and indicates importance to savings banks in keeping

that this

Reserve

Savings Banks Can Borrow From

Says he is
of permanent gradual infla¬

current theories

Federal

^requirement

notice

makes for difficulties in

borrow from Federal

can

of the

members

security of U. S. obligations.

on

concerned about

the

about

and loan associations and commercial banks.

Reserve Banks

be

which has led

inquire"

to

you-

deposit.

borrowing at the Federal Reserve
Bank, even though you are not

ings banks, though not members,

'•

of

of

Administration, new methods and new programs will be
making, Reserve Bank President calls attention to savings banks' growth in face of the dual competition of savings
in the

!

this-situation

some

new

;

banks

not

are

the

13

:

Telephone BOwling Green 9-1225

New York

32

The Commercial and Financial Chronicle

14

1953

Goals o! Banking in

increased costs of goods and serv¬

tice

it aimed.

for luture losses.

In many instances, a fair anal¬
ysis has indicated that the tax has

time and time again, nas indicated,

discriminated

vestments

-

Others

this

^ependabld tower of economic
of banking strength
in last depression gave government opportunity for entering
the credit field, and this has "just about eaten us out of house
and home." Says banking is at crossroads, and bankers must
decide to fortify themselves so as to be in position to afford
legitimate credit when needed. Says new ways must be devised
should be

i

Holding banks

strength, ABA executive indicates absence

a

52%

the

to

social

is

structure

economic

and

Remove
-

studied

which

consideration.
is

It

to talk to
regarding

the

issues

v/hich
to

which

and

if

should

free

enterprise system,

depend¬

sion

be

a

able

Harold

W.

of

tower

Brenton

strength to our

weakness of so
many banks during the last de¬
pression aggravated the situation
and made it more serious than if
cur economy had
been supported
stronger banking structure.
Too frequently, banks were un¬
able to give the emergency "sup¬

by

a

port to legitimate requests which
are ordinarily made of
banks in

stringency. This not
only made the situation more se¬
rious, but it also retarded recov¬

a

period of

the way was open and
invited government to nut its

•i:i the front door.
sessed

As

they

inflation
War

has had

system.

the

ratio

of

total

about

It

.

temporarily under the cir¬
but

tended

as

only

they

The trend

trols

government

and

odness

given

was

for the

stopgaps

duration.

a

in-

were

toward

big boost.

of

Let's take

a

banks occupy now. Since the last
great
depression, banks have

i.rceadily
tion.

strengthened

They have

bo occupy
earned

to

moved

posi¬

forward

prominent place
respect.
They have

more

a

public

n

their

be

helpful

to

greater

of

aasses

people. They have made
progress
in handling de¬

i'reat

positors' funds in
ithical

achieved

these

and

capable

a

Bankers

manner.

have

accomplishments

bankers

have learned

creasingly good
.

lble

of the

the

are

barome¬

and

actions

people of the communities

of

a

The financial busi¬

nation is

flowing through

banks at the grass roots level.

*An

"he

in¬

address

National

American

by

Mr.

Credit

Backers

Brenton

Conference

Association,

,'Jb January 26, 1953.




before
of

the

Chicago,

an¬

The

Matter of Adequate

Reserves.

Let

*

tection—the
for

•reserves

expedient, such tax

other
from

still

consider

next

us

of

matter
losses

adequate

and

loans

on

Farsismted

assets.

an¬

bank deposit pro¬

other aspect of

fimp iwiripmnrt"!

partment and the American Bank¬
ers
Association that the method
would be tried
basis.

bankers

formula

in 1947, it was the
understanding of the Treasury De¬
adopted

was

experimental

on an

Continued

hmm

had

formula

original

The

on

page

41

1

for J. A. Hogle & Go.'s Spokane Office

New Quarters

upon

13.2%

18

years

the inge¬

devise

bank

new

capital.

additional

this

is

bank

several

are

limited

tractive

possi¬

and

will

be

only here and there.

at¬

The

issuance of preferred stock gen¬
erally speaking is opposed by su¬
pervisory authorities and bankers.
The

of

amount

retained

earn¬

ings

has

not

keep

pace

with deposit growth as
high taxes and inflation.

result of
as

sufficient

been

aspect

one

of

to

.IS?-

-&•

<*■■■•
-

_

•

'

■

•'

«*

...

...

.

building

additional bank capital, considera¬
tion must be given to the tax
poli¬
cies

of

the

resulting

Federal

Government

effect

on

if*:,.''

and

corpora¬

tions generally.

The

Federal

income

tax

of

to¬

day bears no resemblance to the
original corporate income tax of
the

1913

act.

tions today

American

are

corpora¬

caught in

great

a

financial pincer-movement,. More
and heavier taxes bear down on
them

on

one

corporations because they do not
vote and

because the

consumers

thoughts

Of this nation.

our

an

job under favor-

14,700 banks

of

ness

do

conditions.

The
ters

to

amount.

At the time the present

certainly has not attained in prac¬

side, and an obsolete
by increasing their know-how and and inequitable tax structure is
enow-why and by conscientionsly closing in upon them from the
ticking to the banking business. other. Taxes have been loaded oh
3anks

that

times

loans

current ceiling

a

equity of

was

to

building

there

Hence,

look at the position

it

what

build

stock

a

Current Position of Banks

three

eligible

present

Building increased capi¬
through the sale of common

tal

con¬

complicat-

war

by

outstanding, with

cor¬

re¬

from

from

devolves upon

of

ways

bilities.

cumstances,

declined

half

now

the last depression gave
government opportunities for
competition with banking.
Some
'vr;f
the
agencies
created
were
needed

a

accumulate

to

the basis of its past 20-

on

plied
of

re¬

This ruling

loss experience ratio, multi¬

year

it better.

tax-free

ago.

To

during

as

bank

a

serves

method for

a

debts.

bad

From 1934 to 1951,
capital accounts to

of

assets

capital,

strength in

wise

to

for

allows

A

provides
establish

banks
serves

aftermath

its

6.7%—meaning, the

banks

of

lack

im¬

stockholders in their banks is only

house and home.
The

be

can

proved,;
and
added
protection
given to -bank -deposits, by the

understand

banks.

to

banks

a

the problems peculiar
He issued mimeograph

recognized
6209 which

We.reemphasize that the capital
of

pur¬

Commissioner of Internal Revenue

elimination.

structure

tax

In 1947 the

reserve for bad debts.

to

profits tax, and an ac¬

excess

income

for

reasonable addition to

a

capital-asset ratio of the bank¬

nuity

out

resulting

and

II

debilitating effect

a

ing

us

poses

capital funds from $6,951,393,000 to $11,615,767,000.

foot

eaten

opposed

deduction

a

increased

voluntarily

have

then, they have grown until they
about

firmly

law in the

Internal Revenue Code permits as

bank

to

just

profits tax is
phase of the

tucked

losses.

The present statutory

The American Bankers
is

for meeting his

means

when

abandoned

be

is

interest,

present law expires on June

its

"

^

depression

reserves

the fact that in the last ten years

not only came to the door; she
Walked right in and had pups."
During the following decade,
<he
government
gave
birth to
agencies all over the place. Since

have

profits tax

tive committee is working toward

in

the

when

he had

as

ever

of the necessity for a greater
capital structure as evidenced by

the dispos¬

wolf

and

in the public

1953.

the

profits.

active

be

20's

bankers I

little worried back

in its away all around his bank. He had
unfair in its provided over a period 'of years a

excess

Association

.

very

ful

the

"The

corporate

The

longer

30,

movement

a

was

the

in

complex

to the financial weather.

its application, difficult

the

tax deduc¬

as

exceedingly

and-should

Assuming that the adoption of a
Federal
excess
profits tax was

deposit

we

said.

rancher

•

all

should

excess

protection is an
important topic of discussion now¬
adays. Bankers have been mind¬

The

ties,

of

'■H-

World

and

a

struck

is

law

eco¬

watches the banker

one

of the wisest

The

a

not

do

government.

on

Bank

One

develop

the

until

apparent

made,

situation deteriorates.

knew

no

asso¬

porate tax picture which deserves
even more pronounced
attention.

de¬

less

be

nomic

penalty on brains and
throttled enterprise, and
discouraged new venture capital.

,

Bank Deposit Protection

banks

Weren't in
sume

pendent

our

would be bet¬

would

so

earnings

those whose capitaliza¬

or

result.

coopera¬

other particular

by stronger capitalized

and

banks

position then' to as¬
their complete responsibili¬

business

* Since

ery.

The public

banks.

prior

is exaggerated.

administration,

cease.

permits

and loan

in

banks,
on

abnormal

an

elimination of excessive taxes.

The

favor

by

in its elimination.

the deci¬

in

made

be

must

revitalize

to

are

ter served

The

economy.

we

may
often

Such

become

communities in bringing to
more reasonable tax; level is defpublic attention the reasons why
double taxation is unjust and why -initely in the public interest, and
the public should be brought to
the consumer should be interested

People must make the decision;

structure.

paid

savings

Bankers

placed on

been

Act of 1951

their

government can be eliminated.

banking

Banks

-

has

should

profits

dividends

taxation

seriously needed? If the answer
then much of the depend¬

ency

dur¬

present double taxation of

mercial

is yes,

relate

a more

able

it

losses
losses

It favors those hav¬

in¬

ana

when

later.

in

toward total elimination of double

of

one

-

profits tax. These groups
are virtually operating under the
single tax
method. Measures
should be put into effect for com¬

primary functions of banks to
give legitimate assist¬
ance to borrowers when such help

pur¬

my

Is

made:

be

must

of

sound

nevertheless

placed

excess

able to

be

Taxation

loans

some

are

tively iinanced corporations, banKs

energy,

ciations be allowed

decision

a

82% tax rate is even

Double

and

that although

conserva¬

reserves

Past experience,

in particular.

tion

tions; it also exempted them from

the

you

pose

is

in

high

The Revenue

tives

against

with

themselves

vided

which

at

Every
The tax has
these encouraged wasteful expenditures, for a clue

an

even

theoretical end

history,

A

is

corporate
that

There

their pockets.

the

ing

Corporate Profits

The

in

adopt

we

vicious.

more

many

doing

crossroads.

strengthen it
merit

The

are

tax

If

tax even before the

52%

a

times, but

things which bankers
good times to
y/ell-being of America. The bank¬ strengthen their position are ac¬
ing
business
functions
in
the cruing to the public benefit and
should help to iron out future
public inter¬
peaks and valleys.
est, and any
measures
to
Right now, banking is at the
banking

strong

excessive

are

dividends reach

double taxa¬

deposits' growth. Calls for end of
tion on profits.

cient to offset

that

then the 6,500,000
paying, in most

theory,

cases,

suffi¬

banking capital, since retained earnings are not

to add to

*

-

contend

stockholders

i

*

•

.

dividends.

reduced

Des Moines, Iowa

President, State Bank of Des Moines,

'

corporate taxes greatly reduce the
stockholders' real income through

Association

President, American Bankers

,

A

Thursday, February 12, 1953

.

ices.

BRENTON*

By W. HAROLD

vital

.

.

;

(686)

acutely
that

aware

have

do

vote

corporate

ration
as

a

think

that

income

tax.

higher cost

Many

econo¬

excessive corpo¬

taxes have the
sales

not

If

same

this

effect

theory is

correct, then the public is absorb¬

ing

excessive

taxes

through

the

keep

center,

J.

moved

to

A.

Hogle &

of

new

City.

This

made
ager

by

projection-type
Trans-lux tickers have been in¬

at

New

was

Mr.

offices introduce

Porter,
a

new

and

con¬

to

prices

of

new

providing immediate

New

York

Stock

Ex¬

prices.

-

the
The

with

the United

across

Canada,

investors in Spokane.
room

Exchange

commodity

services

the

minute

Board

Stock

and

A

Dow-Jones ticker and direct wire

cept of modern facilities to assist

A large

report

continuously

to

York

Chicago

Man¬

of the firm's Spokane office.
to

latest

stalled

Avenue, in that

announcement

Hammitt Porter,

According
new

offices

modern

the American Stock Exchange.
The

have

Co.,

and other murals

Stock Exchange,

Spokane's

with

pace

West 523 Sprague

firm's
staff

the

up-to-the-

brings

financial

reports

new

has

directly

of

brokerage
west.

fice
in

ex¬

firm, for years

outstanding

in

offices

the

mining

North-,

Since 1949, the Spokane of¬

Hogle has steadily grown

of

volume

and

evident

to

importance to the.

it

Recently

Community.

the

firm

that

became
the

ca¬

of its location at 5 Wall
Street, had been outgrown, and

pacity

immediate

plans had to be made

enlarge its facilities.
Established in 1915,

expanded,
several

the

of

one

to

offices.

been

addition

States

E. J. Gibson & Co.

&

Co.

have

offices

*

J. A. Hogle

in

York

New

statistical

City, Los Angeles, Salt Lake City,

established
to
provide
Spokane Stock Exchange se¬ library
curities, will comfortably accom¬ complete information on all types
modate even the largest group of of securities.
J. A. Hogle & Co., one of the
investors.
Tastefully
furnished
and decorated in a modern motif
largest brokerage houses in the
West, with headquarters in Salt
with blond furnishings, the Board
Lake City, Utah, has been serving
room boasts a 20-foot mural of the
JSvmkqne investors since April,
trading floor of the New York 1949, when they purchased the

Denver, San Diego, Beverly Hills,
Idaho
Falls; ■ Ogden,
Poeatello,

change, American Stock Exchange
and

upon^ the

goods they buy.

mists

are

of

of the actual effect

excessive

taxes

of

who

millions

To

growing importance as a financial

perienced

men,

and

a

Butte,

Boulder, River¬

Missoula,

side, Calif.; and Reno.
The

New

firm ..is

York

numerous

member

a

Stock
other

of

Exchange

Stock

and

the

and

Com-

Volume

177

Number 5194

.

.

The Commercial and Financial Chronicle

.

15

(687)
r">>

LETTER

TO

THE

EDITOR

international
domestic

uWhat This

Today Is Two Presidents"
Been

i

To remedy governmental
shortcomings, he suggests a
joint system of selecting two Presidents of the same
party,
administer this country's international affairs and the

to

one

v

other to manage

Editor, Commercial

our

national domestic problems.

and

It

Vice-President Thomas
Marshall's facetious remark—

R.

was

"What

Good Five

County Need? Is a
Cent Cigar"—tnat won

for

the

him

t i

o n

h<

during

r

Wood row Wil¬

*

*/

dents.

subordinate

be

-

to

eacn

Admin-

principal

fi*

character

of

which

was

Everett

pill
;

A*

iltfill

.

he

w

only

scorn-

in

Executive's

in

official

not

are

the

s

to

gentle-

p u n

he *

;

to

to¬

might

Man—the

all seriousness
alter

his

slo¬

gan

to

the

Look

This

Two
is Two

We Extol Our Presidents Same

of

Whether

we

know

Americans

are

a

our

as

wifh
with

,hp
the

particularly

very

presidents

"f

"

of

passage

during

circums

time,.'

war

each
of

in

of

fact

32

our

represents

an

political

pe7cf?-

We love to build

legends

•

hallowed

000,0U0

sni

which

if

advis0rv

of

v..

*-k

,

™

/
.Who

Bn D. Roosevelt in turning

presidency have become

over

"heard

not

to

action

rightfully. the considerate
considered-;by warrant before
»

<

cisions.

"tall

,to

do

even

JLG

rijPk

of

cmoothlv

General

COrDorations
nrpcjrjpnts

nrp<ddpntc

of

fit

and

electorate

be

of

svstom

This

Motors

whv

and
the

thp
the

nf time
timp
of

rmirsp
course

wp

we

have

come

as

Flection Honeymoon
Is
Election
Honeymoon is

When the

Over

na¬

change

order

who

considered

are

to

be above reproach and
among our
most cherished traditions

This most. sacred

erally accepted

as

Will

of

genuine

of

Americanism

onrl
and

m

patriotism—the

nf hov»c

mothers

that

brand

fathers

our

AH/41it

to

Annual

from the first moment we
U1
.
able to take an interest in

•

around

about

in

bition

in

the

Assurance

the

just

United

his

life

is

advice

to

you,
liftle

in

is going to find out that

Presidency

President

inhere

hlT

^

bt

haven't

we

)a<^-P^idPnts

11^
( tO

iJOWGrS

P°wers

more

order"

wm

with

emml

Country¬

Republic,

will

say

vvlli

suggested in this article,

as

work

not

yet

the

writer

that this

country is

essentially a tripartite
government
(executive,
legisla-

..

have
to

the

ot^rna-

put together.

Angels Fcaf

of

purpose

ing this system

illustration

Stevenson

if

elected would be accountable to
„

,

people

tions

and

;

■■

for

all

-

■
.

Kefauver

foreign
for

rela-

all

do¬

anyone

affairs.

,

.

This voting proposal' should also

that "What This
Country Needs
Today Is Two Presidents" is con-

provide for two vice-presidents

sidered

each

some

mortals




almost

ticket,

one

vice-president for

lions

can

that

bered

last

163

to

years

Constitution

the

blessed

this

amended

no

country

has

be're-

Another

.

••

'

less than 22

,

Executive

as

familiar

official

the

as

personnel

of

0f size

states

or

'

•

i

»

from

regardless
ii

body in the.world.

;ALEXANDSR WILSON.
25 Oak

life

business

Bankers

National

Trust,

States.

City,

the

Manufacturers

stated

the

the

that

Company's
1951

over

amounting
gain

in

new

18%,-

was

$165,487,000,

to

a

business of $71

group

million for the year. The Com¬

life

total

pany's

insurance

in

forcg has grown to $5,222,947,000,

increase

an

including

of

8.8%,

insurance

group

force of $1,493,501,000, up

Annuity

payments

Company

has

which
or

in

19%.
the

undertaken

provide immediately

to

in the

future, through individual and
contracts,

group

$117,833,000

per

Sun

The

tional

amount

to

annum.

Life,

an

with

company

interna¬
branch

paid out in benefits during 1952

ing day,

or a

Of

this

total of $118,618,total

received

$81,632,000

by living policy¬

holders, and nearly $37,000,000
paid

was

deceased

beneficiaries

to

policyholders.

of

policy
to

issued in

1871

$2,604,604,000.

The

was

rate

assets

*

•

Total

benefits paid since the first Sun
Life

earned

3.84%

was

on

the

corhpared

with 3.70% in 1951.:

With American Sees.

The

Amrerican

poration,
He

was

•

Securities

Sun

nearly

(Special to The Financial Chronicle)

m^n-

Chase

the

Canada's leading

which included group insurance

interest

with

the

United

reviewing

company,

amount

Ridge Ave.,

panies;and

National,

the

J

'BOSTON, Mass.- — John C.
Mathis, Jr. jhas become associated

the

In

Bourke,

almost $500,000 for each work¬

agement and know that a handful
of
New
York
City trust combanks like

The

47% of its assets,

States cities from coast to coast,

population, to the great-

est deliberat ng

with the

bank

will

year.

service in many leading United

times to

Senators

two
48

*

"Chronicle"

anyone

the

of

»

Summit, N. J.
Feb. 3,1953.

Corporations Have?

The readers of

last

of

instance, where two is

of

selection
each

-

Personnel Do Big Banks and
»

has

increase in

was

of the 58
a^encies> bur.eaas, offices, councils,

Top

Life

Mr.

track

Much

dividends

than

been

reach today's attainments.

in

any one man,

the

the determining factor in our podePartments> litical system, is the Constitutional

Ilow

W.

George

$22 millions, $2 mil¬

more

Sun

000.

Oor-

Devonshire Street,
formerly with Hemphill,
111

Life,

30

States,

•

in

United

the

and i

Canada

Britain.
A

in
the

of

than 90% of

more

business

its

operating

countries

world, does

Great

,

copy

complete

jf«ust
and the Guaranty Trust Noyes, Graham, Parsons & Co.
have an executive personnel of

of
1952

the

Sun

Annual

Life's
Report,

^

_

oVc„_ 7p0
not

ef£ieerS

include

any

and

make

quirements
ohe

man

to

of
and
fill

that

officers

than vice-presidents.
In
any
comparison

might
on

amount to

?por!sible. f°r 0*_ke?P intimate

are

the voters would

that

understand

mestic

by

of
of-

on

.

to Tread

telling

list

|llih1

For the

the

i

unending

over

its present state of working efftciency. And it should be remem

same

N

f«ll pwyer and responsibility to

policyholders'

1952 figures of

WOuld remind his critics

x

the! mestic national affairs-

of

enterprises
presidents

venture

Again how

,.

"Hofatio Algeri" let us say; that the Democratic
teen-agers, mind presidential contenders had been
country whose big and Stevenson and Kefauver. Employ-

A World rn Which

to

under

the

corporate

the

meet

callers at the White House

by

Bourke, President. During 1953.

Order

devoted citizens of this great

constitutional

.

:

tions of the world

So

Amer-

we

lofty

a

produced

is

am-administer our international' rebe
to' latlons; a"d (2) Eari Warren fully.iri the authorized
to conduct our do-

should

States.,

This

period

of Canada

Company

released

invested

Two

wllBlltull„xiai

Eisenhower ficial and social- business.

the most laudable

the

^

honeymoon

Lwight,.

aspire ta the highest office
land

the

President-elect

the

us.

,-Fverv schoof boy is assiduously

taught'that

After
over,

the many outstand¬

Report of the Sun Life

the

offhand that the "two presidential

»•;

country and at the

than $5 billion

more

among

ing figures reported in the 82nd

^

^
boards> committees, administra-.
(to D0
be, VOlcU
voted IOi<for- -rlT,
m tions arid commissions that stem"
were
Pads).
fwo
Democrats
and
two
*€re
.ywo ^emociaxs ana two from the president's executive of-

proudly instilled

us

world

gen-

are

.

Of course, many of my
men,

they
his de-

addit'."?n to his other duties,

feeling is

the true mark

in force of

one

iri

seems

'

I

and

and
written messages to Congress
and the
time

.

tional institutions akin to
gods on

pedestals

S545 million and total insurance

to the

and

Canadian companies at

ping al

Work?

*

For in

presidents

our

New business for the year top¬

vice-

Washington*?

suggested

Com¬

—

has 47% of assets in U. S.

pany

improvement

president
in

545 MILLIONS

and

presi-

.

years.

upped to $22 millions

and

nartv

same

an

one

presidential

I'

with

;

eight

partners

wouldn't

two

response

vice-president

too great

making

for

has

trading de¬

Policyholders' dividends for 1953

in

as

present rather out-moded

over our

fected

personal resentment.

to venerate

our

$

policies and problems
in
to
make the operational

twn

deliberation

f

Lamperti

IN 1952 SOLD

top ex¬
man¬

other

1 1 1

the

on

17

SUN OF CANADA

the

thp

pro-

over

cope

demands

Mr.

Founding

Done

Be

but several

one

heads

manappmpnt

again that the duties of theman

for

firm

head of the

as

partment

with in earnest.

has

the

with

a

In the last quarter-century, the,
For-instance if the president
presidents -emerge as glamorous people of the United States have ;was a superman
physically and tive and judicial departments), dinational heroes to rank-with the witnessed the-projection; of the
mentally, he could not understand- rected by "Two Houses" of ConWorld s great and near great,
■ ;■
government by sonrie of *our 6hief ingly read all the laws wnicn tne
g°ress with
a membership of 531
A simple suggestion to consider executives into every conceivable
,531 members of Congress pass up
contentious
legislative
minds
anything different than one presi- form of business,- political and so- .to him for approval, signature and
which have succeeded in giving
dent to head our government will cial activity—activities that were
{ enforcement.
Nor has he the the world a successful demonstra¬
te met by some well-meaning na- never envisioned by the Founding strength and the time to individ- tion of the democratic process in
tive Americans and
hero-worship- Fathers as Presidential duties or ually write the comments, vetoes action that has been
slowly perpers with strong opposition and prerogatives.
and recommendations of his oral
by time until

served

are

might have been
Germany an-act of.war.

Leon

of

Mr. Morse is office manager

cashier.

and

ex¬

thinking", for the company's

aging

The latter incident .hap-'dentls time and
person,
or
to
before we entered- World * thoughtfully give ' the problems
War II in the fight against Ger- and policies of his Administration

have

announce¬

last.

years,

single large corporation-

a

ecutive

day has

s

insular

over

Such

the

admission

the

personnel

needs not

??? me.s~ m 18 to 48
frornFi 4,000,000
to 158,souls.
om

time
without
the
sanction
of
Congress; and*(2) the late Frank-*

many.

marked in

of

Identified

So the Writer makes bold to say

that

pened

re*

with the help of tradi-

and

been

...

Something Must

gress.

their

up

and personalities to the stature of
full-fledged

tions

^fi?ea

,

our

spective characters
statesmen

nnn

50 United States destroyers to for one
Britain without consulting Con-* meet the

epoch

r

in

1

board and 26 general managers.

*ng the" steelf industry in 1 peace-* her."

Presidents,

development
country's history.
„

the

oeoame too big.

ana Alexander Hamilton

r\

Woodrow Wilson. Herbert
one

(1)

pow-/ multitudinous, intricate and farwriter to be a paramount political
two re-" reaching, no one man can now
question of the day and one for
cent
cent
examples which
illustrate successfully shoulder the responthe best legal minds in our land to
the'-usurpation of Constitutional sibilit„
|he presidential office reason out and a
subject for the
•'
a'frun of the inill
power: (1) Mr. Truman in seiz-. yxceptji
man-''state bar associations to grapple

Be

is

ment

Morse and

ma.ior

constitutional

Set forth here

ers.

on

ances.

his

exceeded

some

depending

George Washington, Thon as
Jefferson, James Mohroe, Andrew
Jackson, Abraham Lincoln, Theodore Roosevelt, Grover Cleveland,
any

the

not, we
sentimental

it

or

do

over-aggressive and power minded, portions, .to be the leadmg power
president who, although solemnly in a warlike world. Our problams
love to sworn to uphold the Constitution,'both foreign and domestic are so

or

individually

moods and

our

to

'ipvcui-' und a dual vice-presidency. The
cally exercising certain functions, country of George Wasnmglon's

*

it

praise, denounce and idolize
of

Cabinet,

no

has

the:
For a long time the' intelligentcon-1 sia have been saying that the

and Queens

We

or

President

.

responsi-

judicial uepaiWe^s,

Country

Stm
Still

people.

Executive's

aa^writtrii into law by its, president job has

Prpsidpnts
"
Presidents."

firm

,

was

Lamperti

FRANCISCO, Calif.—Rec¬
ognition of years of service to the

(1935) are
in
General Jesse M.
Levy, Jr., Harold B. Wil¬
president in every
division of their vast organization, liams, and Richard Lawson.
some
seven
presidents, 37 vicepresidents,
a
chairman
of
the
ecutive

system

"Wnat

—

Needs Today

Chief

viz;

the breakdown

at

Motors, with

designers to give us a political ior any one man to Ml. So sooner
of tripartite government,, or later we will have to consider
viz: The executive, legislative and the
question of a dual presidency

Alexander Wilaoi

subject of this
article

Constitution

United vStates— which

in

Morse &
SAN

(2) Presi¬

^t^ers
acting like an advisory
cabinet.

bilityv
Cck^ihet;

^

Powers

to

Lawson, Levy Admit

Committee; the board
.

^

were

alive

day,

-

from"

Indiana,

the
U

executives,

the Finance

thinking in all matters and "carry
For, background
emphasis,
it-the weights."
may be well to take a retrospect,
V
tive look at tnat greatest instruWorld's Toughest Job—
merit of free government known
^le Presidency of the U.r S. '

home-

man

Country."

well

dent, (3) Chairman of the Execu¬
tive Committee, (4) Chairman of

and

responsible

four

Chairman of the Board,

are

President

directly

tually

serve

of the country's problems is still

classic

...

Presidential

Perhaps this
same

a

be

potations are officered with vir-

duties,

advisory capacity,

an

subordinate to

Edward

patriotic

Constitutional Limitations and

part.

a

Hale's

"The Man Without

it would

of our country compared to the
lesser combined importance of the

y.-y

son's

istrat Ion

Then

stop and think of the magnitude

And, too, any person of voting age Congress or to the country's elecwith the vision to espouse a two-' t°rat<;- Cabinet members do not
President Government may perindividually initiate domestic or
chance find himself as
isolated, foreign policies without presidenlonesome
and
despised
as
the? tlal sanction. Therefore the brunt

affec-

s

Republic will

our

small, in the United States of
America headed by 500,000 presi-

would

Chief

fully inform you is not within the
framework of our Constitution.

This

nation

of

zens

the 500,000 corporations, large and

the members of the Cabinet

anathema, something ardent citi-

Financial Chronicle:

to
on

Angelo J. Lamperti to
500,000 corporate enterprises and
is amended will not permit this the fact that this beloved country general partnership in the invest¬
ment banking
firm of Lawson,
dual division of authority.
of ours is headed by only one solLevy & Williams, 1 Montgomery
Despite the. President's person- itary chief executive,
Street, members of San Francisco
ally r appointive Cabinet, constiAs "Chronicle" readers well Stock
Exchange.
The advance¬
tuted
to bear the impact of the know, many of these large corments
are
effective
as
of
Jan.

grown.
new

interesting

r—

gentlemen

sponsibilit-y to the country.
True, our Constitution, until it

out-' :

it might be

turn our sights for a moment

the two elected presidents and the
t W o
elected
vice-presidents —

other within their rank, but would
act in
their own
right and re-

Presiden¬

now

chair,

for

one
.

Neither; of these

Country Needs

A satirical yet
suggestive discussion of the existing
tial order which Alexander Wilson
holds has

affairs- and

policies.

does
lower

B

including

the President's, re¬
view of the year, is being sent

,,

.Estabrook Co. Adds
(Spccir.l to The Fina-nciai Chronicle)

BOSTON, Mass..

—

William

t'o

K.

all

policyholders

obtained

from

group

any

or

that

we

Bovey has become affiliated with

branch,

presidential

re-

Estabrook

offices of the Company

the

capacity

the

presidential

of

members

& Co.,

of

Boston Stock

the

15 State Street,
New York and

Exchanges.

out

North

or

America.

may

of the
.

be
100

mortgage

through¬

16

The Commercial and Financial Chronicle

(683)

company's

>...

Thursday, February 12,1953

Depart¬

Investment

ment since 1942.
if

*

News About Banks
NEW

BRANCHES

NEW

OFFICERS,

Bankers

and

Kildea and A.

York

Corn

of

ETC.

.

From

Karl Pons

Exchange

announced this

Trust

Bank

it

was

Both

men

New York,

of

Company

CAPITALIZATIONS

week.

Assistant

Vice-

Presidents of the bank. Mr.

Kildea

formerly

were

Ahead

G.

President,

Chairman

Committee

nance

Castle

&

has

of

Company revealed plans of
further
expansion with the ac¬

the

Fi¬

Director of

and

Cooke,

Trust

Vice-

President Eisenhower's emphasis upon religion

Ltd.,

t

a

Honolulu,

southeast
and

Fifth

of

will

be

property

the

Avenue,

Street

34th

of

corner

Di¬

o r

for

reconstructed

new

a

Bankers Trust

banking office to serve the bank's

Company,

business

New

of

York

it

City,
Feb.

6

Sloan

Chairman

of

on

S.

by

of

the bank.

Mr.

the

the

founded

G- G-

sugar,

His

lands.

Is¬

billion

greater

Co.,

New

bank's

the

$2

mark.

The

capital of

enlarged

newly

$144,000,000 by a $6,000,dividend, became effe-

'Jan.

tive

issue

Jan.

of

22

in

noted

As

19.

hitherto

by

the

if

Swiss

Bank

nounced

to the

Corporation

receipt

the
an¬

of cable

however,

advices,

approved

the

Sermon

last year; to donate

Frederick N. Goodrich and Jean

Presidents, and John J. Walhovic

add

to

proposed

1,000,000

Trust

at

the

buildings, and to credit 4,000,000
a special reserve account.

Waldorf Astoria on

Feb. 3,

tenth

52

has

now

membership

a

521, of whom 99 are retired.
group

Colt,

G. Farrell,

Gurney,

Elinor

Edward

Kosanke,

Charles

Schlatter,

G.

of

elected

were

and

the Board

to

if

Assistant

of

pany,

nounced

New

a

Montclair

N.

'Bank

it

was

an¬

Savings
will

March

on

1.

be

the

National

New

3

Chemical

it

by

announced

was

Benjamin

Strong,

Both Mr. Goodrich and

formerly Assist¬

were

continuously associated with

and

Mr.

Mr.

&

past

16

been

1941.

of

Al¬

Department

while Mr.

member

church

given by the New

Jan.

on

Banking

30

to

of

Department

certificate

a

capital
Trust

stock

Co.

of

in¬

of

the

of

Syracuse,
N. Y., from $1,800,000 (in 180,000
shares, par $10) to $2,550,000 (in
also

30

the

announced
of

par $10).
On Jan.
Banking Department
the filing of the plan

into

of

*

V

An

*

addition

movement.

capital

lot

of

the

New

Both party conventions always open
member of the cloth and I suppose this is

a

Britain
on

Na-

page

as

it may.

for

Howard

of

.

Ship conversions and repairs.

$11,895,074

$ 73700,162

14,720,386

15,606,339

49,834,050

2,160,196

2,438,047

5,625,820

.

Totals

«

i

.

*

.

.

,

.

'

1

*

2,783,653

.

$44,336,094

Dec. 31, 1932

period

•i

•

<

•••

,

Number of employees at the close of
tho

The

Company

,

•

•

*

•

•

•

36,831,783
5,974,581

> 8,670,391

$32,864,374

$139,611,596

$89,308,865

At Dec.

•

to

He is, of course, not the only one of these old-time reformers
His name just comes readily to mind. Their reap-

reappear.

pcarance

has

the

been

subject\of

the

-

seem

them

are

unfounded but it is

to thrive under

'As glad as I am to see
their ilk never get a

a

fact that

Republican Administration.
the Republicans back I hope these men or
foothold again. I would rather have the?
we

a

have just had.

31, 1951

Managed Investment
Programs in Calif.

'

:

>

Firm Name Now

Bramhall, Falion Co.
The

firm

name
of
Bramhall,
Co., Inc., 2 Wall Street,
New York City,
dealers
in cor¬
M.
Monaghan
have
formed
Managed Investment Programs, a porate and municipal securities,
has
been
changed to Bramhall,
partnership, with offices at 41
Falion & Co., Inc.
Sutter Street, to engage in the

SAN

FRANCISCO,

Calif.

■

—

Nathaniel S. Chad wick and Clyde

Barbour &

$353,180,062

17,702

were

14,069

formerly with E. F. Hutton

Milwaukee Bond Club

Company, and in the past Mr.

Chadwick

was

an

officer

of

Dinner February

Na¬

tional Securities & Research Cor¬
on

the percentage-of-completion basis; such income for

period will therefore vary from the billings on the contracts. Contract
billings and estimated unbilled balances
possible adjustments resulting from statutory and contractual
provisions.
*

are

By Order of the Board of Directors

.

R.

I.

FLETCHER, V/ce President and Comptroller

J. O. Whitaker
FT.

aker

business
North

Opens

SMITH, Ark.—J. O. Whit¬
is

13

MILWAUKEE, Wis. —The Mil¬

poration.

subject

*




around

Pi;g&s> Club. We should hate to see a recrudescence of
>■
the political power held in the former Republican days by such
/Jfmen as Wayne fB. Wheeler and Bishop Cannon; Maybe the fears

securities business. Both partners

$316,751,120

reports income from long-term shipbuilding contracts

Jonuary 28,1953

discussion

much

National

ony
to

But he swung a

the

-

&

period

dry

31; 1931

10,451,564

At Dec. 31, 1932

the

;

$37,832,110
.

in

days of the

But the Republican club has aroused Mr.
Howard's fury and while this would not alarm me in itself, it does
alarm me when he once again can get back in the papers with his

>

2,924,914

,/

Ittimafed balance of
major contracts unbilled at the close of
rhe

De«.

*

leader

the early

all around the Capitol.

40

these fellows

Year Ended

-v$24/671,859

Hydraulic turbines and accessories
Other work and operations

.7

Dec. 31, 1931

former

a

Washington in

weight around

of those who entertain

,

example,

I had not heard from him since

hodge-podge of heathens which
Three Fiscal Months Ended

Dec. 31; 1952

But it has been

Coolidge-Hoover days.
Now he is back, getting in the papers again with such things as
denouncing the Republicans for organizing a club within a stone's
throw of the Capitol and serving alcoholic beverages. There are
and have been any number of dispensers of alcoholic beverages

$100,000 to the

Continued

of the

a

Democrats.

New Deal and the repeal of the 18th Amendment.

*

of

(Subject to audit -adjustments)

,

or
am

Republicans but the Republicans put on

as

Clinton

Rev.

Oswego, N. Y.,

Quarterly Statement of Billings, Estimated Unbilled

j v ;

I

a corollary of the new tone which the Eisen¬
hower Adminstration is setting that some of the old reformers of
the former Republican days are coming back to life.
There is the

the

Balance of Major Contracts and Number of
Employees

contracts

minded
What

I wonder if it is

of the Oswego County

merger

National Bank

the

Be that all

250,000 shares,

Newport News Shipbuilding and Dry Dock Company

Shipbuilding

religious

Democrats.

a better show
performance.
Frankly, many years ago, before the New Deal came, when I
was. a young rebel and a Democrat, I used to think the Republi¬
cans were professionally sanctimonious. Undoubtedly I was wrong;
there was little good, indeed, that I could ever see in the Repub¬
licans.
I was convinced everything they did, even to attending
church, was simply to get votes. After all we have been through,
I am mighty glad they finally got enough votes to return to power.

fury.

-

more

the

of religious

.

DHKnts during the period:

are

than

having been close to politics and politicians for

say,

than

Heaven

Syracuse Trust Co., of
1934 Syracuse, under the title, "Marine
Midland Trust Company of CenMr.

associated

years,
a

as

*

trol New York."

been

Operating

Yates has

since

since

has

the

the

Goodrich

Mauze

Walhovic
with

Divi¬

have

and

company's Investment Depart¬

ment,

as¬

Bank

5

Company

been

for
Feb.

York,

Feb.

the

sion.
On

States Trust

Republicans

the

experience that the Republicans will have a prayer at the
beginning of a little courthouse political rally whereas the Demo¬
crats get down immediately to thei business of the evening.
I
would put it this way: I am sure just as many Democrats get to

•

have .been

Vice-Presidents

sociated with George Lysle, Vice¬
-President, in

Yates

ant

Bank, -Montjoin Chemical
He will

L.

©

was

State

Syracuse

Mr. Mauze

Vice-President of the

J.

Approval

Mauze

crease

President.

Com¬

Feb. 6 by N. Baxter
Chairman.
Mr.
Mac¬

Pherson,
clair,

York,

Trust

on

Jackson,
,

&

Co.

$1,500,000 to $3,000,000

appointed Assistant Secretaries of

on

Vice-President

Chemical Bank

Jean

a

my

Com¬

26.

the United
of

of

Arnold

:•»

Mercer C. MacPherson has been
elected

Goodrich

York

Governors.
if

N.

to

true of all the large assemblages of both parties.

dividend

National
Trust

&

*

F.

that

mean

with invocations by

stock

a

the

Bank

tal from
of Jan.

Ray¬

the Mount.
is

devoted

more

bany, N. Y., has enlarged its capi¬

mond Fausel and Albert H. Hilde-

brandt

as

^

^

result of

Bernsten,

A.

Grimm,

a

$1,500,000

mercial

Ed-

are

on

not

more

$275,000
$25,000 stock dividend.

a

As

President; Kent

Barferon

good 25 years, is that the Republican politicians seem to bring the
church more into their profession, to utilize it in their business

of

club.

Carlisle

trying to

^

Vice-President, and
c Secretary.-

O.

Harriet

the

of

officers elected

new

vmund

:,aV.

member

re¬

tional Bank & Trust Co. of Bronx-

by

addressed by S. Sloan
President of the bank and

do

I

If

capital of the Gramatan Na¬

of Jan. 22 from $250,000 to

of

The

ma¬

ville, N. Y., has been increased

was

honorary
The

The

The

members.

new

if

if

New

dinner

welcomed
club

of

Club

Company, of

annual

its

at

York

Century

Quarter

Bankers

the

The

us.

healthy leadership for the country as a whole. But as I look back
it strikes me that all Republican Administrations and Republican
politicians generally have a closer association with the church than
do the Democrats. I mean no offense against the Democrats and

francs to

The

impression

breakfast himself but he commanded his Cabinet to be present.
This is certainly all to the good and should prove to be

bank

new

the

his

fund;
2,000,000 francs to the re¬

for

serve

exactly

a
feeling among the Washington political experts
that Mr. Eisenhower is bent upon setting a high moral tone for
Administration.
Not only did he attend the Conrad Hilton

27, it will be proposed to
dividend of 8%, as against

francs to the bank's pension

tJt

mag¬

based upon the last election

us,

There

Feb.
a

a

con¬

turns, have more of a picture of loose living
and corruption rather than that of a government devoted to the

for 1952.
At the general
meeting of stockholders in Basle

pay

not

is

jority of

ac¬

counts

on

at

presence

prayer

Truman Administration left with

meeting held in Basle,

a

Switzerland,

recent

more

only a deacon in a nearby Virginia church
he taught a Sunday School class.
This,

but

directors of the

effect that

bank, at

of

has

Agency

his

unpublicized

Truman was what you might call a
church-going family man and his much
criticized side-kick,
General" Vaughan, was

if

if

York

followed

was

Mr.

not

New

this

and

good

their annual meeting on Jan. 13.

The

flurry among the
among church-going
self-prepared prayer

nate, Conrad Hilton.

at

stockholders

the

since his elec¬

favorable

breakfast
ducted under the auspices of the hotel

plans to increase the capital were
approved

comment

and

church

our

296)

(page

and

considerable

a

by his becoming baptized in the National
Presbyterian Church, his steady attendance at

stock

000

caused

considerable

$150,000,000 of the National City
Bank
of
New
York,
increased
from

has

clergy, the church press and apparently
people generally. His action in delivering a
just prior to his inaugural speech aroused

if

if

if

7%
if

Mauze have been appointed Vice-

©

V

The

crossed

if

Company, San
ty

recently

General

the

in

American
Trust
Francisco, Matson
Navigation Co., etc., etc,
Electric

in

Broadway.

assets

directorships

other

those

include

Hawaiian

165

at

West

the

on

the

in

and

offices

1.9

was

1824, main¬

1,

York, including executive offices

pineapple and
shipping interests
Coast

tains

April

on

it

when

Broadway

on

in

active

tion

charge of the Astor Place branch.

antici¬

is

It

tenants.

May 1, 1954. Chemical, which was
first bank to open an office

San

Francisco, and
is

various

by

pated that Chemical will open its
new
office at this location about

Montgomery
in

an¬

consisting

basement, is
stores

stories and

other

area,

Jackson

Baxter

N.

occupied

and

Colt,

midtown

the

The building,

eight

now

President

lives

in

nounced.

was

announced

charge of the Park Avenue
branch,
while Mr. Pons is in

quisition of the property at 349353, Fifth Avenue. Located on the

been

elected
re c

Montgomery,

of the News

By CARLISLE BARGERON

is in

George

Washington

have been elected Vice-Presidents

CONSOLIDATIONS

REVISED

if

engaging
from

"A."

..

in

a

offices

waukee

Bond

annual

dinner

Room

of

the

party
Hotel

securities
at

1815

Friday,
are

$10.

Feb.

will

Club

13.

hold

its

in the East

Schroeder,

Guest

tickets

Volume 177

Number 5194.. The Commercial and Financial Chronicle

(689)

AVCO reports

for 1952

"a

family of

famous names"

7
KITCHENS

Year ended

HIGHLIGHTS

Nov.

Consolidated

net

Consolidated

net

sales

.

Year ended

Nov.

30,1952

$326,585,641

30,1951

$286,598,113

Steel wall and base cabinets, kitchen

sinks, waste disposers,

BENDIX
v

HOMI

Automatic

income

Earned per common

$11,028,927

.

$10,089,214

$1.20*

share

$0.60

$0.60

Net

'

-

working capital

Net tangible assets

'

'

»:■
-

.

.

,

,

$88,279,359

$87,933,721

(neticorth) $93,870,288

$88,620,194

.

.

refrigerators, freezers,

ranges,

kitchen sinks and

cabinets, automatic dishwashers,
rodm air conditioners, television and"

'

v

washer-dryers, refrig¬
ranges, freezers. ^

CROSLEY

$1.10
electric

share

<

electric

erators,

Shelvador

Dividends per common

APPLIANCES

washers, dryers, ironers,

combination
.

ventilating

fans, automatic dishwashers.

radio sets and other home equipment.

Crosley Broadcasting

Corporation
WLW,

Operates

"The

Nation's

Station,"Cincinnati, and WINS, New

Per

share

common

.65

.

$9.07

York; and television stations WIW-T,
Cincinnati; WLW-D, Dayton; WtW-C,

Columbus, and WLTV, Atlanta.

Per

$583.00

preferred share

Number of stockholders

.

$514.00

64,494

*

Based

on

8,890,824

common

shares outstanding at close of fiscal 1952.

**

Based

on

8,819,385

common

shares outstanding at close of fiscal 1951.

63,288

Lycoming
Aircraft and industrial engines, pre¬
cision machine parts.

JJew Jdea 3nd HORN
Spreaders,

corn

rakes and

loaders,

pickers, balers, hay
power take-off
mowers, grain and baled-hay eleva¬
tors, hydraulic loader attachments,
shredders, wagon boxes. SPENCER

BOARD

OF

HEATER

DIRECTORS
Heating boilers for commercial and
residential

use,

castings.

*

VICTOR EMANUEL, Chairman

C. COBURN DARLING

GEORGE E. ALLEN

GEORGE A. ELLIS

*

'

WILLIAM I. MYERS

Avco also is helping keep America
BENJAMIN H. NAMM

IRVING B. BABCOCK

JOSEPH B. HALL

THOMAS A. O'HARA

NEAL DOW BECKER

CARLTON M. HIGBIE

R. S. PRUITT

JOHN E. BIERWIRTH

ROBERT L. JOHNSON

JAMES D. SHOUSE

strong, with its
ities

plants and facil¬

engaged in the manufacture

of electronic

equipment, aircraft

components, tank engines, auxil¬

iary

power

units, military aircraft

engines and other materiel essen¬
JAMES BRUCE

.

*

MARTIN W. CLEMENT

AVCO




.

LER0Y A. LINCOLN

ALBERT C. WEDEMEYER

MANUFACTURING
420

LEXINGTON

tial to the defense program
our

W. A. MOGENSEN

AVENUE, NEW YORK

nation.

of

•

CORPORATION
17, NEW YORK

17

18

The Commercial and Financial Chronicle-.

(690)

Mortgages

as

Life

Life Insurance Company
Montpelier, Vt.

holdings
by life insurance companies and the current situation in mort¬
gage loan field. Discusses attractiveness of mortgages as invest¬
ments, and concludes mortgage lending plays a very important
part in investment programs of life insurance companies.
Looks for increased emphasis upon uninsured mortgage loans.
companies dur¬

standard of living of
can

the Ameri¬

people;

1952

surance

their

to

1947, the assets

life insurance

companies have in¬
creased not less than 6.67% nor
more than 7.42% in any year, in¬

at

esti¬

mated total of

increasing amount of funds avail¬

$21,275,000000, consisting

creased

of

more

able
L.

Douglas Meredith

funds

than

for

investment

from

in¬

assets, to say nothing of
becoming available for re¬

2,000,000

investment from amortization and

total

other payments. Assets increased
about $4,900,000,000 in 1952, and

individual loans. This
greater than that held
other type of investment

was

by any

construction,

and

and

comprised

ap¬

without

risks unless the
construction

demand for

free money market

new

of

structed 7,100,000 new living units
and in four of these years, we

est

time

produced

Modern

out substantial

units annually. In 1951 and 1952
more
than
1,090,000 units were

sufficient portion of it convert¬
a reasonable

by regular payments or selfliquidation, by prompt sale with¬
collateral

the

for

loss, or by
loan

use

as

maximum

an

A-

Loans

'

r

increased

mations

of Mortgage

of Liquidity

1,000,000

births,

credit terms, from

«

ment

carefully planned and, prop¬

of

suburbs

of

rate

and

the

a

of

limit.
the

liberal
move¬

population

and

constituted

folio

affords

into the

from

a

to

assert

itself

to

a

greater

Any
rate

ments.

which

prohibits
a cer¬

may

When

the

FHA

was

cre¬

ated, a maximum interest rate was
imposed by regulative fiat, but
this

intended

was

as

an

limit, and not necessarily

or

which

coincided

with

outside

limit
sought

a

or

to determine the market rate.
time has
FHA

As

passed/the regulation of

and

VA

rates

appears

to

have changed from the imposition
of a limit belbw which the market
would

tual

determine

fixation

the

of

a

rate

to

market

ac¬

rate.

Unwillingness of officials to rec¬
ognize changed market rates has
r e suited
in the imposition of
charges* upont borrowers by other
methods, some legal and some
devious; and the creation Of
doubts

uncertainties" which

and

have served
if

effectively to reduce
not completely to shut off the

flow

of -funds

from

many

into

these

loans

private; sources,
As
evidence to support this statement,
it may-be pointed out that in 1952,
FHA and VA purchases by life
insurance
companies
comprised
only 32.70% of their total pur¬
chases; compared with 45.49% in
1951 and 49.69% in 1950.

Much current evidence

..

.

law

properly be de¬
scribed as a usury law, and by the
same token, current FHA and VA
regulations on interest rates be¬
come
nothing less than highly
specialized modern usury enact¬

greatly im¬
mortgage port¬
Furthermore,
higher degree of proved housing.
1,400,000
families
still
continue to
liquidity than is generally recog¬
live doubled up and many of these
nized.
The pattern
of mortgage
seek
their own homes.
loans now offered by life insur¬ families
Each of these influences continues
ance companies provides for selferly

Ages.

taking of interest above

tain

family for¬
from

Middle

usury laws were enacted
the intent of allowing free

with

on

strong

the

to

even

the

of

determination of interest rates by
the market place with an outside

materials. The boom resulted from

requirements for cash.
Degree

of

excess

produced
annually,
in spite
Regulation X and restrictions

to

purposes

institution's

in

anathema

was

Schoolmen

that at
more

suggests
long last ^government once
recognize and appreci-

-will

ate the function and value of free

,

markets, and that interest rates
fixed by administrative fiat and
-supported by a lady (Fanny May)
whose creation and existence
of

doubtful

value

will

were

restrict

mortgage rates less in the future
than in the past. If so, realistic
interest rates will make FHA and

VA

loans

more

attractive to

in¬

officers.

vestment

Recently .vthe Federal Housing
Administration announced that a
one-half percent service charge
•

•

onstrate that:

In the mort¬

"Fanny May" still
to prevent the free play of

seryes

.

to dem¬

become

a

>

serve

has

market,

gage

itself.

expresses

.

figures

kind

cannot

,

These few

this

available

funds

-

of

Prior
to
take
place ernmental influences.
financing, but March, 1951 and the now famous
accord
between
the Federal Re¬
it is equally obvious that lenders
will not hazard their funds nor serve System and the Treasury,
government
policies
will builders assume construction
prevented a

construction

liquidation as a result of monthly
available from repayment payments on principal and inter¬ lesser extent and all will contrib¬
proximately 23% of outstanding amounted to approximately $2,- est which differs greatly from the ute, barring the unexpected, to
mortgage credit which aggregated 000,000,000. Thus; it is fair to as¬ loan pattern of 25 years ago under another good year for new home
sume that in 1953, the life insur¬
1953.
Estimates
an estimated $92,500,000,000 as of
which a borrower procured a loan construction in
"the year-end, an all-time high, ance companies will have approxi¬ for three to five
900.000 to 1,200,000
years with no range from
.and comprised the largest single mately
$7,200,000,000 to invest, regular reductions on principal. units, and a million seems like a
block of non-government long- with $5,100*000,000 coming! from
Secondly, an active real estate reasonable figure at this time.
the increase in assets and $2,100,- market
term debt in the country.
Over the longer range, 11 be¬
greatly contributes to the
comes equally
At the end of 1952, so-called 000,000
from
repayments.
Of seeming liquidity
reasonable to ex¬
of mortgage'
mortgage holdings of the life in¬ course, only part bi this very sub¬ loans for, as properties axe sold/ pect a gradual slowing down in
surance companies aggregated
stantial sum will go into mort¬
new home construction.
The pro¬
loans tend to be paid off feither
29 J %
duction of new
of total assets, compared gage loans, and this fact in turn out of
unit^ some time
savings or by refinancing. •
with 14.8% only seven years earl¬ points to the significant question:
ago caught up with and since 1949
Thirdly, mortgage lpan liquidity
ier. The latter figure represented What portion of these $7,20Q,000,- also is enhanced
has exceeded the r$te Of family
by insurance of
the smallest proportion of total 000 will be invested in mortgage
formation which is expected to
loans by the Federal Housing Ad¬
assets so invested in the history loans?
'
!
decline significantly, probably to
ministration and by guaranty of
of the industry. .This compared
Also, it always is possible that loans by the Veterans Administra¬ .750,000 families or less per [year
with 43% in 1926, and from 1890. if
mortgage loans are sufficiently tion. These endorsements and the in the hot distant future. The
101933 the proportion never drop¬
attractive, other assets may be marketability, of FHA debentures .Bureau of the Census predicts
ped below 29.3%.
697,000 new households a year
sold and the proceeds reinvested assure that
in the event of fore¬
'
At the year-end ..life insurance in
through 1955, and then only 624,mortgages.
•
!
closure, the lender can expect
companies held $5,,700,000,000 of
000
through 1960.
The interest shown in mortgage
Furthermore,
an early recovery of cash without
FHA loans and $3,350,000,000 of
the, pressure
from
doubled up
loans by investment officers re¬
the complicated problems of real
VA loans. If these are considered
families
for
independent housing
sults from the well known invest¬
estate liquidation which resulted
as a separate classification of se¬
ean .be expected gradually to re¬
ment advantages of such ! loans,
from farm loans in the 'twenties
lax further.
curity because of their certain pe¬ but Which warrant restatement
and from urban property loans an
culiar attributes, the companies
here:
But, for the foreseeable future
|
the'thirties.
Fourthly,
the
devel¬
held only $12,225,000,000 of mort¬
"One can reasonably expect a
strong
(a) Funds invested in mortgage
opment
of
Federal
agencies
.with
gage loans in the strict sense of loans are
demand for mortgage money from
directed, generally more or less
authority to buy the
the word, which represented only
desire to finance residential
speaking, to highly commehdable
mortgage loans augments greatly,
16.7% of total assets.
property. Commrtciai construction
purposes which contribute to ele¬
their real or
potential market¬
[Outstanding commitments to vation of the Nation's standard of ability. The Home Owners'. Loan. during recent years has been re¬
tarded by materials shortages and
buy mortgage loans at' the end of living; /
"
Corporation and the Federal Farm
the year totaled probably slightly
Regulation X, and relaxation of
'(b) Abundant i security in the
Mortgage Corporation set an ex¬ the former and last
ih excess of $1,000,000,000, seem¬ form of real
year's suspen¬
property and1 debtample in this type of activity, by sion of
the latter already have
ingly indicating continuing inter¬ paying capacity bf the debtor;
refinancing defaulted loans and added
est in mortgage loans on the part
significantly to the demand
(c) Attractive income, depend-!
of life insurance investment offi¬ ing, of- course, upon the relative demonstrating a commendable ex¬ for mortgage money.
cers late in 1952.
Builders reiterate that credit is
condition of the mortgage market perience with them. Though vague
assumptions fail
to constitute a' construction
and other investment markets;
commodity, as vi¬
sound investment collateral, it is
Mow Mortgage Holdings Are Used.
tal to building as lumber, steel,
i d) The possibility of higji geo¬
hard
i to
believe
that
some phases
Proceeds of the mortgage hold¬ graphic diversification;
bricks or cement, in order to em¬
j
of HOLC activities would not be
ings of life insurance companies
phasize the importance of an ade¬
(e)
High
diversification of
renewed or that the Reconstruc¬
were
used primarily to finance credit
quate supply of money to the con¬
risks;
1
'
tion Finance Corporation would
some form of housing. About 97%
struction industry.
(f ). Attractive maturities ^
Interest, in
not enter the. market in.the event turn is
of the number of loans were for
.the price paid for .this
(g) A high degree of liquidity
this purpose, and -80% financed which 'a generation ago was not of extensive loan defaults: Fifthly, Commodity, and whether or not
the use of mortgage" loans by the investment. officers allot to mort¬
individual homes.
an attribute of iportgage loans.
institution

market

to

capital somewhat theoretical as the result
It is obvious that of unprecedented exercise of gov¬

to the rate of

expenditures.

ible into cash within

•

dicating statistically that life in¬
surance companies have an ever-

year-end

an

life in¬

of 500 United States legal reserve, meet

mortgage
the

institution.

true

types.

31,

residential
sOme extent

The financial institutions of this
The same
market forces and encourages un¬
portfolio of country have made possible since
realistic interest rates on FHA and
bonds of serial or varying maturi¬ the end of the war the greatest
VA loans.
ties.
building boom in the nation's his¬
Lending "upon usury,"/ that is,
tory, and have effected a new high
For the purpose at hand we
in American standards of housing. at interest, was forbidden by Mo¬
shall define liquidity of a port¬
From 1945 through 1952, we con¬ saic law, and the receipt of inter¬
folio as the attribute which makes
an

be

a

Dec.

The volume of mortgages avail¬ discouraged
from borrowing
but
to
think of able for purchase bears a direct make the demand for funds equal
the supply. But in recent years a
relationship
tothe
volume
of
new
attribute of an :

logical to

of

companies;
(5) A larger portion of life in¬
surance
funds
readily could be
invested in mortgage loans of all
Since

total

holdings

(4)

cant investment outlet for

more

would

ity

Mortgage loans, both his¬
torically and especially more re¬
cently, have been a very signifi¬

they acquired ap¬
proximately
$4,000,0 0 0,0 0 0
of mortgage
loans,
and
thus brought

is

a
point that a sufficient
number of potential borrowers are

individual invesment,

an

it

such

standing, might be considered an
illiquid investment, whereas 2,000
mortgage loans of the same pat¬
tern over a period of time might
contribute greatly to the liquid¬

into

mortgage
loans. During

of

Thursday, February 12, 1953

.

ited savings and a strong, demand,
rates will rise until they reach

Bases of Volume of Mortgages

resulting from the fact that one
mortgage loan, completely amortizable over its life and in good

Life Insurance executive reveals extent of mortgage

insurance

turn.

liquidity as an
investment portfolio. * This con¬
cept
circumvents the difficulty

By L. DOUGLAS MEREDITH*
Executive Vice-President, National

ing each of the last five years
have put not less than 27 % nor
more than 40% of available funds

1953, and the relative rate of re¬

vestment

highly significant change in in¬
attitude or - philosophy.
Historically, we have tended to
think of liquidity as an attribute

Insurance Investments

Life

a

.

would

be

permitted

Section 8 loans.

,

this

time

ognition

on Title I,
It is not clear at

whether this

is

of ihe need [for

a

rec¬

higher

interest rates on mortgage loans,
the "funds at their disposal or of the need fdr additional com¬
for loans at commercial banks or
depends entirely ;upon whether or pensation to the investor on this
the fact that loans insured
[by the the Federal Reserve Banks af¬ not the
price Offered
for the type of loan/because of high ex¬
Federal Housing Administration
fords another, possible source of money is
penses incident to their small size.
sufficiently, attractive.
or
guaranteed by the Veterans
A large number of factors in¬ It would appear that these loans
Administration are a hybrid type liquidity and there always is the
of loans.
Fi¬ cluding rate of return, risk of loss, always were entitled, to a,differ¬
of security. They rely upOn real likelihood bf. sale
the term* bf the investment, arid ential because of the high costs of
property for the underlying secu¬ nally, development of FHA loans
expenses of .origination and han¬
handling.. In any event, the action
rity, but the insurance and guar¬
resulted: in the" evo'lutioh of an dling, determine the relative atr- provides encouragement, for be¬
anty' endow them with mjany of
tractiveness
of
various
over-the-counter market for loans
types- of lieving -that the Federal Housing
the
attributes
bf
bonds,' even
investment and the avenues into Administration, is becoming in¬
though they are called mortgages. of all types which market prior
which these sayings will be di¬ creasingly aware of the necessity
some
investors to 1935 had not existed.
Consequently,
rected. However, other things re¬ of maintaining a market return
have been willing to go so far as
Nothing recently, .has .occurred maining the same, rate of return on the loans which it insures and
to'think of FHA and VA loans as
or impends which
alters the at¬ or the price which users of capital it is-to be hoped that further con¬
tantamount

Implicit in these advantages is

owning

institution

as

collateral

.

gages

(1) Life insurance companies as.
group of institutions hold* the
largest amount of mortgages, and
are a vital factor in financing the
homes, business properties and
farms of the Nation;
(2) Mortgage credit extended
by life insurance companies Has
been a major factor in providing
the home building industry, now
©he of the Nation's largest indus¬
tries, with the greatest prosperity
ihever has enjoyed:
to bonds and have
.are. willing to pay. for .the funds
structive action soon will be taken.
(3) Mortgage credit from life supplanted bonds by' FHA and tractiveness of mortgage loans' as
they borrow, is. the deciding fac¬
Insurance companies has contrib¬ VA loans.
investments to life insurance com¬
Relative Attraction of Mortgages
tor.
In an entirely free money
uted
greatly to the increasing
This attitude toward FHA* and
Whether, available funds are in¬
panies, with the exception/of the [ market in which interest rates are
VA loans reflects the thinking of
! *An address of Mr. Meredith at 8th
rate of return available. There¬ permitted to find their own level, vested in mortgages or other in¬
Annual Conference of the New York Uni¬ many investors that mortgage loan
rates will be determined by the vestments depends in large part
versity Graduate School of Business Ad¬
portfolios possess a higher degree fore, it becomes appropriate to willingness of borrowers to
ministration, sponsored by the Mortgage
pay upon the relative investment at¬
examine the outlook for the pos¬ the rate
HSankers
Association
of
America, New of liquidity than was the case a
necessary to procure cap¬ traction of mortgage leans when,
TTork City, Jan. 28, 1853.
generation ago, This constittftes- sible- supply of mortgage loans m ital. in such a market, with lim¬ compared; with; other securities,
a




.

*

-

.

Number 5194

Volume 177

.

.

The Commercial and Financial Chronicle

.

19

(691)

tinue

preferred and
seeking
mortgage credit enter the money
market
and compete for funds

mainly bonds and

the foreseeable future, provide
large opportunity lor mortgage
lending;
(4) The investment appeal of

return

with

ments, they need have no concern
adequate funds.

and

the

Despite

of. FHA

and

when

other available

have

we

ing

investment appeal
VA loans, given an

available

that

order, to
costs

relatively

Canadian Securities

avoid

losses

incident

to

and

By WILLIAM J. McKAY

high

troublesome

Among the important developmepts which have accompanied

(7) Finally, part of the invest¬
ment

investments,-

r.armrin'c
Canada's

appeal to be found in mort¬

tial increase

ingness to adopt methods of han¬
dling them which add to their

than

pacity.
this

investment appeal.

adequate return, life
officers recently have

for several

tinue
first

place,

constitute

The

tend to
more

own

unusual opportunity in
positions to show what

American
can

given

that,

demonstrate

to

proportion of assets of life in¬
companies
invested in

surance

all-time low

Thus,

1890.

since

increase in the holding of un¬

an

loans

insured ' mortgage

might

readily be expected and, particu¬
larly in this field company pref¬
erences
for
large versus
small
loans

and farm loans will be

exniDitea.

The

resi-

commercial,

for

and

dential,

•*

.

in w|uch loans are

manner

serviced has

;

direct bearing upon
as investments

a

their attractiveness

tool

great

fulfills

metal

in

to

service

to

backbone

-

perience
strated

determines

frequently

servicing
whether

good

companies.^Ex¬

repeatedly has demon¬
that the quality of the
loan

a

to

proves,

investment

or

be

of

item

an

a

continuous trouble. Life insurance
investment officers

coming to

are

greater appreciation of the value
of efficient servicing and may be

expected to exact only high qual¬
ity performances from their cor¬

This

respondents.

particularly

as soon as

cies begin to
!

It is
to

pertain

delinquen¬

rise.

difficult, if not impossible,

conclude

out

will

emphasizing

which

receives

tention.

discussion

with¬

once more a

point

this

The

all

little

too

mortgage

at¬

lending

of

If

the

on

promises

live

the other hand that

con-

dition is not fulfilled

well sink into

private effort is at

and

peace

lives
of

in

economic

war,"

a

we

a

low ebb

very

Kennametal

solini's Corporate State.
If in
1953
the results

Inc., Latrobe,

recent

Pa.

derstood
Mc¬

pie

pointed
Philip M. McKenna

which

harder

are

and

carbide

than

any

in

Alert

men

from

and

,

and

in

take

can

big
as

for

heart

domestic

more

steam

commercial

of

high

use.

taxes,

very

and

hnrd

credit

inflation,

growth

on

,,The net result

for repans.

pumps

While-primarily

developed

as

a

petal that resists the deteriorateffects of 2,000 F in gas tur-

ing

centuries

to the ancient

damental

Rome

to

and

even

city of Ur. The fun¬

extending
credit with real estate as security
remains unchanged, but the man¬
of

this

which

in

ner

principle

is

done

has

changed greatly and continues
to
change.
The opportunity for
further
improvement challenges
every

..While
of

alert and progressive lender,

large part
of

some
-

investment

the

mortgage

be found
and

on

the

attraction

depends in
the return available,
loans

attraction

will

also

in the adoption of new

improved methods of trans¬
our
business, particularly

acting
.in

servicing, which will

improve

the

net

return.

to
Let it

serve

3

0UtPut

of

Division

heat

and

wheie

hardness

conditions

corrosive

or
a

and

light

metal

resistance

of high
bend-

to

in

AnS obstacle
attainment

gams

of
of

wider

earlier

to

economic
economic.

real
real

the

of these rela-

by adopt,or,

ducted

processing

n*u™'..rnay

apera!:mg
American
,ty

of

columbite,

used

heat-resistant

greater
power

located

of

in

profits tax. Profit

being defined in the dictionary as
"accession of good; useful results;,

have

ing station, Windsor, which finally
will have four units and a
66,000,kilowatt capacity. The third unit
of

completed

The

new

be said that while the phys¬

Rich

L.

Hearn

total capacity of 376,-

a

Commission

has

during

rural line facilities by more than

with

unddr

way

in

2,500

circuit

miles

and

the

number of farm services

new

lines

total

was

ex¬

being

pected to reach 129,000 by thq(jepd

many

of this year.

other sections of the country.
It is reported that good progress

.

*

..

.

"

v

in rural electrification

particularly
and

in

Manitoba.

made,'
Quebec
But, progress has
was

Bankers Offer Case

Ontario,

Co. 3V^% Debentures

,

also been made in other Provinces,
Thus in British Columbia, the B. C.
15 miles

Morgan

Stanley

&

Co.

and

J,™"P

■

-

a new issue °*

3lso

31/a% debentures due Feb. 1, 1978.

t.

Columbia

British

Power ^he
debentures

brought

into

power

in

head of Salmon Arm which is de-

signed for

ultimate capacity of

an

Commission has installation under
on

additional

two

units

of

The

of

has

Aluminum

made

good

Co.

of

progress

secured

are

priced at 100%

interest

to

yield

3.50% to maturity.
Proceeds of the sale will be used

by

the

nance

ments

jn
of

company

farm

to

company

short-term

bank

reduce

loans

and

to

its
fi-

part seasonal requireworking capital. The
produces

machinery

full

a

line

inclXg

of

trac-

oper- tors, threshers, combines, eultiva-

planned for early 1953.

metai inc.

dIus

Clowhom Falls plant at the

tors,

Canada
on

harrows

plows,

machines

and

other

and

implements, and is

its

among the five largest manufacMr. Mc-'Nechako-Kitimat dev el op men t, turers in the industry.
by mid- with work well up to schedule
i^e new debentures are subject
ficult for Mr. McKenna to see how
summer we should know whether
for
1954
initial operation.
The to redemption at the company's
there can be an "excess" of desir-,
we are
to go forward with free-' present program calls for 420,000 option at 1031/2% if redeemed on
able
consequences!
He
believes,
dom or whether the juggernaut of" horsepower in three units to be or before Feb. 1, 1957 and therethat such an economic monstrosity
big Government and high taxes completed in 1954, but ultimate after at prices decreasing to the
as E'PT will be allowed to expire
cannot
or
will not be removed capacity
of this development is principal
amount
if
redeemed
d^.e
from our backs/His belief is that estimated at more than 2,000,000 after Feb. 1, 1975. A sinking 'fund
only as part of the madness of a
the American people can and will horsepower.
providing for payments of $630,self-destructive time.. It has cut"
choose the right path again. '
In the Yukon area the North- 000 in each year
1958 through
the financial muscles of the horses
west Territories Power Commis- 1977 is calculated to retire at least
able to do the most effective pull¬
sion brought into
operation its 50% of the issue prior to maturity.
ing.
When everyone is, encour¬ David S. Miller Joins
Mayo
River
development near An additional sinking fund of up
aged and enabled by fair laws to.

it is dif¬

desirable consequences,"

decision.

according

to

He believes that

Kenna.

*

•

pull

only
then
will
prosperity based

together,
have

America

Union Security

Co.

of%neLa3!000ghorshepowenr tobfnl. <0f f630'000 wiU »Perate >

(Specie.) to The Financial Chronicle)

driving a generator. Provision has
America has
CHICAGO, 111.—David S. Miller
a
second similar
ical sciences progressed with rev¬
that
encouragement from wiser has become associated with Union
maye 1
olutionary speed, mortgage lend¬ political leaders in 1953, our coun- Security Co.. 29 South La Salle tjniting failed to keep abreast of try can resume the progress which street." Mr. Miller was formerly.
The Yukon Hydro Co., Ltd., is
progress.
it enjoyed for over 150 years un- [n the investment department of planning to increase capacity of
never

four-unit

1952 extended its transmission and

distribution,
or

the

generating station, Toronto, was
placed in operation.
This plant

operation its two-unit 4,000-horse-

Kenta-

year

'

Construc-

transmission

International.'way

a

ca¬

Another unit began operation at
the J. Clark Keith steam generat¬

.y*e¥nPor0S!^cts ^orSi 12,0°° horsepower. In its John
Tbe South Hart plant on Campbell River the

1953 is

total turbine

units totalling 1,260,000
horsepower on completion

in 1956. T

active in the field

was

power

main

Commission

m

In summation,

the
The

12

brake

and

of

number
Quebec.

,

excess

a

Otto

lVIattawa.

near

plant will have

were

on

installations in 1952

tioraiw"metals
has been what is a
Pa"amanian corporation, at 28,000 horsepower each with
PPT,.
..PT. PTP present wholly-owned by Kenna- ation

called the

well

the

at

generating station

000 kilowatts.

The

expl0rat10n 1S an activ-

Kennametal

the

eight units

operation

Ottawa River

are

If T

British; Guiana and New

for

Mexjco

in

$25,000,000 J. I. Case Co. 25-year

Scheelite

is

in

Holden

of

seven

in

tfon o°f the'Sf'unTtUof
Tooo
8 e
82,9°°; terday <Feb' 1X>

expected to continue
bines, Kentamurn will find many- a{. this-year's level of about $1V4
uses during
1953 for working un-, j-oiilfon
Exploration being conder

industrial

miles

Nevada

placed

will have

can be confiscation' tion also

its

the first

production."

power

are

q
which went into
operation in December, 1952. The
couver>

witnessed

were

of

The

companies,

of

Coquitlam'
Brfttai: Electric <*. depleted
east of Van- house at Wahleach Lake,

iil oumDSafhufsltiSrdowneti^
bide at Port
thus saving down-time Columbia,
17
oil pumps,

sion

power

plants

is1 electric

0f capital,rather than taxation of
ings despite the mounting conse-,.inqome. That means the destruc.quences
of ; inflation* Tungsten tion of initiative in the United
carbide mining drills, and bits for
States,!a consummation doubtless
coal mining
machines, will aid desired'by.-our enemies.
*
production Per man. in basic in- ; : Kennametal Inc. looks forward
dustry in 1953- In the oil industry, to * improvement in its Canadian
Kentamum, the light weight butr business in 1953
through the reextremely hard titanium carbide
ceiitly " established
refinery for.
alloy,, will be increasingly used
tungsten and titanium car-

!?f.7P

225,000 horsepower.

consumption,
playing an in¬
creasing part "and becoming a
more important factor in the field

coupled with-threat of continued

monetary

Sisters

u

major* portion

of

offering useful innovations and
combination

Seven

turbine capacity

course, the most important
advances in electric power expan¬

rec-

Winters
reveals
that
though
hydraulic sources still provide the

political

wasteful

Inc.

a

•

doubtless be able to do

The

industry, hard pressed by inflation
of other costs, will turn increasingly in 1953 to such
technological
improvements to maintain earn-

demand of

a

tool'; inventions

the output of

and machines.

men

cemented

titanium

and

often triple

steel,

of

election

economic

Kennametal
tools

demonstrated in

Mus-'total 860,000 horsepower, while
" other developments under way or
of the Panned for later years,
exceed
are
un2,000,000 horsepower,
the peo-,
Canadian Resources Minister

Government, businesses such

cutting and

longer-lasting
tungsten

as

for

freedom

fast-

the

national

37,500

There 1S likelihood of a con- pacity of 264,000 brake horse¬
tinned and accelerated speedup of power. Construction is well ad¬
Canada's power expansion pro- vanced at the Sir Adam Beckgram; New plants and extensions Niagara generating station No. 2
scheduled for operation in 1953 on the Niagara River which will

on by forced draft
by the
Government through large State-

McKenna,

its

the

of

of

Winnipeg River. The
total

a

unit

.

carried

of

are

f

being

President

out,

of

in

the

on

plant has

installation

final

horsepower

electric capaclty to

may very

activity perforce

and

plant

iQ?i01 v^°'? ? mme
' Canada s known
w>fntef power
ourcf are only
about one-quarter in harness,

condition wherein

controlled corporations as in

Mr.

cnn

which

men

of

completed

sixth

added electric capacity settled sections of Ontario and
mg aurmg iyo2 to 1,064,- Quebec. The Ontario Hydro-Eleca""™} 71? brinSs..Lan- trie Power Commission reports

effort, the
strength,

assurance

living in time

business traces its origins through
the

Co.

ord total

sound

.

for life insurance

Likewise, the Winnipeg Electric

by the surging demands of

America's

then have the

by.

their

Private

of

Mac-

capacity of 80,000 horsepower in
eight units.
Operation is slated

Efforts to meet these power de¬

industry will be able

respond.

can

of

the

for 1955.

States,

development has been moti¬

mands

condition

money, then

tecting

Kenna

•

that

of

Of

of

economy.

validates

As

pared

an

help offset effects

people in pro¬

mortgage loans is low when com¬

with the historical record
of the past several decades and, if
only uninsured loans are considered the proportion remains near

should

said Philip M.

will be placed upon governmental
institutions.
In the second place,
the

of

Ampriran
American

time

fa¬

a

be

will

their

atmosphere, less reliance

vorable

carbide

1953

standards

of free en¬

system

accomplish. Business¬
men
not occupying governmental
portfolios have a like opportunity
terprise

cemented

the

businessmen now

an

official

efficiency

"Production, intelligent distribution,' and use of more hard

judgment
governmental guar¬

their

and less upon

the

govern¬

probably
lenders to rely

encourage

antees. Certainly

enjoy

less

United

ards.

manhour

inflationary factor® in today's

will

business

upon

Increased

point of view.

toward

trend

in

not
lending

mortgage

from the investment

ment

Increasing
Industrial Productivity in 1953

and VA loans do
true

the

industries,
and
the
continuous increasing domestic
needs for light, fuel and
power
arising from a rapidly growing
population and rising living stand¬

Hard Carbides Seen

pointed out earlier,

as

loans

FHA

in

construction

a

in electric power ca¬

expanding

In the

reasons.

As

vated

investment
shown in¬
creasing attention to uninsured
loans, and this might well con¬

inary

Arthur Falls development on the
Winnipeg River which will have

industrial

expansion in
recent years has been the substan¬

gage loans depends upon our will¬

become

attractive

more

upon

cases;

compared

may

emphasis

(6) Mortgage investors will ex¬
high standards of servicing in

grounds for believ¬

mortgages

Increased

act

mortgage loans depends upon the

attractive than other invest¬

about obtaining
,

(5)

uninsured loans may be expected;

in

mortgages

makes

years;.

a

to pay a rate of in¬

aj-e permitted
terest
which

they have been for the past two

part in

against persons and organizations,
not
only in this country,
but
throughout the world, who seek
credit for other purposes. If they

more

to

play a very important
these programs;
(3) A large but probably de¬
clining'-volume of building will,

Persons

stocks.

common

upon

realities.

If

these years when net

income

exceeds $7,000,000. The debentures

^

In

conclusion, the current situa¬

der obedience to the Constitution.

Mr. McKenna, who
tion and the outlook for the year
ahead may be summarized as fol- 'tional
Chairman • of

lows:

J.

(*). Mortgage lending plays a
the investof life insurance

very important part m

ment

programs
,

...

„

.

companies;

(2) Mortgage lending will con-




Standard
when
,

the

League,
new

,

Republic Investment Company.

The

believes

from

500

1.440

to

DeHaven

Townsend

-("Special to The financial Chronicle)

In

Manitoba

dro-Electric

the Manitoba Hy-*

Board

completed

irauop,,

'

of

a

"gold

convertible Townsend; Crouter & Bodine, 77
•

currency"

foi

*

and

prices
in

the

corevea ts

decreasing to

years 1975 to 1977.

For the fiscal

year

ended Oct.

its 31} 1952 the company reported ne!

. g^AjjpoRD, Conn.—George E.. 114,000-hoi;sepower Pine Falls de- ale
j $142,898,MO and ineoire
• with
DeHaven & velopment on the ower Wtom;
^
peg River with installation of four oaore intciy ana iKomc ta;..,
r+r*^v.^1nmnnntino
+r>
filK SQi OHH
units.
The Board began prelim- amounting to $16,594,000.
the U. S. Citizen,* Bedford Street.

-Pledged in its platform to the ob-st^ns^is
jective

1956

horse-

100% in the

Administration

at

mencjng at loia/4%

its.Porter Creek plant near Whitepower.

Gold

that

_

'horse

is also Na-*

will be subject to redemption for

the sinking fund

"

.

■

_,

.

nn»

T7

...3

U

~

20

(692)

The Commercial and Financial Chronicle

Thursday, February 12, 1953

...

.

The

Secondary Mortgage Market

Dr.

Heller

should

tution

not

strict

to

exist, Mr. Coiean contends that neither the Home Loan

Bank

the

nor

known

organization

Mortgage Association furnishes

Loan

buy but do not sell, and thus do
Lays down principles on
true secondary market should be
based, and points out
deficiencies in Home Loan Bank System.

serve

which

a

as

last resort for funds.

a

In
talking to you about the
secondary mortgage market, I am
taking as a subject something that,
in any strict
sense,
At this con¬

ference

year

attention
the
of

in

to

report

given
of

Housing

year

That

lets in the Home Loan

for

Banks,
FNMA

secondary

Miles

"a

as

only, within its

L. Coiean

FNMA

more,

place where

another

-

mortgages

of

not

Dr.

that of not dealing with

directly

field

while, in the exercise of its ad-

of

home

financing," and
"a market where

went

on to say,
such mortgages may be
sold provides a means

lenders and investors

bought

or

afforded

comes

are

well

mortgages for

as

into

to purchase

their

cash,

as

authority

for

military,

disaster

housing,
FNMA
close
to
being the

so

primary

lender

that

is one of words rather than
of meaning.
In

the

language

of

trade,

the

insurance companies and the large
savings

banks,

to

and

some

was

invented

in order

other

Board.

dicated:
rate

to

To

accomplish

number of features

a

It

should

form

rectors

with

have

officers

' fixed,

of

are

a

in¬

corpo-

and

di-

overlapping

provide a means for broadening terms. Its personnel and operatthe home mortgage market and ing policies should not be
subject
for moderating the extreme terms to the domination,
coordination,; or
under which mortgage loans were influence of any official or
agency-

made, when they were made at having responsibility for promotall, in underserviced areas. It was, ing housing. It should, to the fullcourse,

FHA,

only

never

thought

could

do

the idea

est extent possible, be
with private capital.

that

this

of national

job.
mort-

The

signed

for

tough

last point

is

a

financed
•

.

1

particularly

Experience has shown.

one.

the

specific and sole that it is difficult if not imposchanneling
savings sible to obtain private capital for
into • mortgages and
diminishing any genuine type of central bankthe fluctuations in the availability ing facility except on the basis of
of mortgage funds from general some form of
compulsory meminvestment institutions such as bership. The scope of such membanks and insurance comoanies.
bership,
the
determination
of
of

purpose

cept other
at a discount
from
par. On
hand
it
should

pretty much in the

exPlorat^orl

dinarily sell its holdings only at

n°t
organized
primarily
for
gave
confidence to the Pr°fit» should assuredly be self—
market for FHA loans. It bought sustaining.
Consequently, it
Joans when and where the private should have an adequate ratio bemarket was reluctant, and it sold tween its capital and the amount
at a premium when the demand
the debentures that it would be
for mortgages by private institu- authorized to issue to the publictions became active. Since the aad
s"Ould be allowed to oper-

buy

ever

ex-

or-

better.
It

/

should

deal

institutions

be

available

only with
should

and

individual

to

The purposes of
tution

would

be

such
to

insti-

an

provide

The

jnally

Federal

prewar

National

manner orig-

conceived for it. It made

market;

and—even

impor-

more

distribution
to

of

mortgage

funds,

prevent sudden and

fluctuations in

the

flow

of

the mortgage market.

to

With

such

wide
funds

War

II,

while

tion, the sudden shift
policy,

the

and

Si

eon-

operated

ques-

impact

of

on

debentur£

monetary

in

controls that it is difficult to make

capital-to-

a

ratio of j.to-20 and a
between its debenture rat*

.

direct

^d

the

2y

percentage

,

institution

an

institution,

however,

; judgments of any validity for this
in period.

■

the

.

.

World

stitutions in times of stress, to en- the situation has been so
homage
a
broader geographic fused by the interest rate
and

Second,

a

tant—it

liquidity to mortgage lending in- end of

cuTrent

this%Jis

an<J

^ate

mortfiage

point!
ii

of

better;

or
was

^tier

than Self-sustaining.
It may be
postwar ex- noted that one reason-for this
adperience did reveal deficiencies of vantageous
spread
was
a
tax,

mind, we may tackle the-next
question. What need do we have

Nevertheless,

the

,

for

institution that will func-

an

tion in these
purposes?

differ-

any

ence

income purposes."

"Although the HHFA report was
referring to the Federal National

lend

FHA

at hand. Thus

are

this,

amount of subscription, and simiformatters would require careful

mortgages

defense,

on

ultimate

can

Alaskan

on

mortgages

and

convert

FNMA

commitment

vance

whereby

opportunity to
mortgage holdings

an

borrowers.

of funds

from

keep
it
when

to

Mortgage Association did operate

not

meet

can
be
bought
and
sold, thus providing assistance for,
and
additional liquidity in the

would

attractive

borrowers.

criteria—

Heller's

that

(3)

narrow

does

al-

penalty in dealing

some

lending

the

on

last-resort

a

of; Reserve

also

gage associations—institutions de-

secondary market institu-

a

par or

limits,
buy and sell mortgages. Furthercan

the

the

rnlfatprar"oT"mo^T^aee""loans "it

to

in

banking.

be

shol|jd rareiy if

it

Banks, and,

loans

in¬

of funds. There should

be

sources

matter, the Federal Land
it excludes FNMA, since

cannot make

should

being

definition

Heller's

Dr.

*

--

the

Banks

commercial

it

tion

institutions."

if

Reserve

of

with

from

mortgagesma^cob-

is

Home

^

in ,times

intended

was

the purpose of enlarging the
area covered by such institutions,

Hence

ways

pro¬

institution

an

It

for that

report

market

is

giving

It

serve

Federal

source

of

security

It

and

crisis.

of

p

1950.

referred
the

n

But

and

Agency

last-resort

a

the

mortgages.

by

member

the

Home Finance

the

vided

lateral.

annual

the

estate

by

the

and

(2) On the buying and lending

institution, since as a rule it does
not
deal directly with ultimate
borrowers, but makes loans to

secondary

a

real

v

definition

market

against

combining

thus

contraction

severe
-

stitution, within its own field,
something of. the scope of the

side,

organizations engaged in
making mortgage loans are able
to obtain funds in case of need,
cnncr
by pledging

called

Rub

made

Banks

field

which

Mr. Louis

ago,

J.

a

does not exist.

"loans

lender,

loans,

~

Points out these institutions
not

referred

the security of

of FNMA

powers

"real" secondary market.

a

by

given

one

be

lend money on

mortgage

National

Federal

the

as

the

empowered to
buy and sell mortgage loans and

secondary mortgage market does

sense, a

with

Mr. Rub. If we do that, we
come up with
something like this:
(1) A secondary market insti-

Washington, D. C.
a

definition

to by

By MILES L. COLE AN*

Asserting, in

the

'

o

.

combine

j

-

no^

give

ways

and

serve

/'

-

believe

it

•

nature

in

the.mortgage

system. It showed that the system

-

as

possible to

exact measurement of that

an

another

these

need. In the first

place, we do not
have sufficient statistics about the

ex-

mortgage market to give us authoritative information about the

in-

that

organized

now

extremely

was

susceptible to the effects of inflationary forces. Amid the easiest
money conditions in history, all
of

the

agencies just

■

exempt feature on the debenture
Income that probably could not
now be obtained,

referred

did their utmost to make

to

money

Another

,

come

source of profit would
from the difference between

the

buying and selling prices on
mortgages; and, with the first
FNMA, this proved to be a sub-

easJer« The Home Loan Bank stantial source of gain. On the
tent large savings and loan asso- adequacy or evenness of the flow system extended credit with un- other hand,' a secondary instituciations, are often spoken of as of mortgage money. Secondly, the precedented generosity. FHA, and tion operating under
proper polproviding a secondary market, situation has recently been so disa*o:ng^ with " the Veterans Ad- icies might be out of the market
be referred to as
offering a real The use of the term in this con- torted by the retention of interest ministration, liberalized mortgage for considerable
periods during;
secondary market. Here are some nection, however, is hardly justi- rates, fixed at submarket
levels, terms to the maximum. FNMA, which its assets would be in cash
Mortgage Association, it is clear,
as
Mr. Rub pointed out,
that, on
this definition, FNMA can
hardly

of

the

which
the

characteristics
it

prevent

requirements

of

FNMA

from
of

fied.

meeting

the

defini¬

tion:

(1)

It can deal only in mort¬
of very limited types and,
in respect to the total of all such

mortgages held by a lender, only
a very limited
degree.
(2) It can deal only with the

to

1 rt t

V\ ATI VI

of

i<?

stitutions
from

gages

it

sell

true

often

that

these

buy

1V1* r«

J

originating institution
/V w

£■£

MM

and offers
outlet at all to institutions that
have
bought

no

from
mortgages
other institutions,
(3) Its function in providing
_

over
ovei,

in
in

rates

not

accept-

"doiM
this'^FNMA
doing this,
FNMA

deprived of the other

was
was

the

submarket rate

portfolio

had

at

been

which

that

the

on

security of
Furthermore,
their

mortgages.

fectively prevented
taking place.

sales

ef¬

from

the defimhon of

^en

a

t* ua£ 1

f
Loan Banks,

up

which have

to

mar-

au-

thonty to buy or sell mortgages,
However,
to
another
However, according
according to
another
definition

given

conference,
have

Sipa

some

these
claim

Heller

•

last

at

banks
to

the

defined

year's
would

title. Dr.
the

term

"secondary mortgage market,"
mortgage credit,"

"secondary
;*An

address

or
as

by Mr. Coiean at the
Eighth Annual Mortgage Conference of
the New York University Graduate School
of Business, sponsored by the
Mortgage
Bankers
Association
of
America, New
York City, January 28, 1953.




be

can

no

ques-

of

flow of

others.

^

—

_

,X"t_

XI

to

As

the

J

i

-

portfolios

a

consequence,
they
be counted upon to serve

cannot

the'puVposeora last-resort"source

money

a

fair-

curtailing"

and

°r

when

sec-

wh^ SeW^S

wh«

"stringent

is

a

is

hs

1

_

JL

1

.

•

J

•

il.

wninmA

surance

va

finengirto

coJpanies

vw

in

compared

as

with the volume of their

tional mortgage
*>
financing. And it

is

taken

my

initial

statement

that

with

better knowledge of the
amount and locale of the demand
us

stand

can

for

mortgage

Deficiencies

not

exist. This
conclusion,
valid, is helpful only in
providing a new starting point. If
we
are
really to come to grips
we

to

have

the

to

answers

questions:
what

are

money.

a

secondary mortgage market

'
the proper func-

in

Home

Mortgage

System
In the absence of

positive proof

of need, however, we

make

a

can

at least

few plausible conjectures,

and,

A-

tendpd?

.

,

How

can

such

...

..

institutions

market

an

al¬

other
that

success

during

a

period of depression proved to be
better
adapted
to
intensifying
rather
once

than

restraining
developed.

one

TTnr|

thpfP

Kppn

a

AYiqfPRPP

1TI

the last

boom,

15

years

a

secondary market instrumentality

0r

a^ted pretty much

the

purposes

an<1 functions of a secondary market, I believe it is necessary to

liquid

the

have to have

income

in

again

is

,oriSinal FNMA during the

ear y

securities.

institution

time

of

stress.

difficult

a

would.

assured source of

an

This

feature

to

achieve, since the time at which,
mortgage institutions had need for*
liquidity probably might be a
time at which debentures could
not be readily sold to the public.
It is true that the first FNMA did

successfully float two issues dur-

^Jfeven^^

sion, but, even on those occasions,

as did the

part of that period, except perhaps

WOuld
„pif

was passed

Withm its limited

erations,
System

,

of

scope

op-

the

Home Loan Bank
long been concerned

has

is

J"
,ltself evidence m support of
that
proposition.

a

lent'it-

suhmar-

thrift

dependent

local

reserves for

institutions,
as

savings,

they

local

at

be

the

time

similar

a

essential.

ever,

is that

ment

would

have accumulated, we may therefore safely conclude that (1) there

tern

are

deficiencies

of

the

mortgage

system which need correction and

(2) that

a

true secondary market

institution

might be one of the
through which deficiencies

be

corrected.

Pending

further

research

reasonableness

conclusions,

of

as

these

may go to our
How might a secondary market institution be organized to serve the functions for
we

third question.

an

as

to
—

be
—

at
—

that such
least

so
as
—

on

free from transitory political and

subject

to

social pressures as is the Federal

My
be

opinion,

to

issue

how¬

arrange-

have

that

banking

to the

re-

sys-

Treasury,

promptly brings

incfmimonfol it at

Driviieae

of

su^Dort uDL
authoritv

ic

relvim?
the

then

+/->

the

Vioxro

for

c^ntral

must
musi

be
De

in
in
on

+V>

ultimate

bankta*

the'central

tion to exert influence
of

would

up
If the secondary market

another

icies

most

was

sounder

a

rather than

a
a

hank
nosi
posi-

the pol-

mortgage instrumen-

tality. While this principle seems
to me to be axiomatic, the method
0f its implementation is far from
self-evident.

There

are

a

num-

of

possibilities, ranging from
complete managerial domination
to simply a final voice in the establishment of discounts and pre- .

been

it

recourse

to the central

This

ber

institution would have to be
—

course

fnTauthor
tv
inS aumorny

.

—

were

tion

needed,

Conclusions

which, wholly established
had

more inclusive
secondary market
facility is to be assured of opera¬

Out of the experience we have
observed
and
the
evidence
we

the

system

of

IfflLZ^LrU „7hZ

significant

the

cnnnort

a period of heavy
demand for mortgage funds,

could

in

thp

ket rate during

means

deficiencies

certainly not have

tn

are

providing credit
upon

low-yield

Third,

such as I have described, it would the time of panic

•

agreeing
-

only partial

the

or

primary

a

SerVe
Th? I?ome Loan Bank System which it was designed?
tney are m- ha{j
inception in the need for
First, it seems to me

.

j

with

broaden

^

nnrnnSff
In

to

of grease, conclude that there

improve

(3)

worked

on the theory that,, where
there is
squeaking, there is need

^ f secon(tary market.
functioning of our home mortgage
«ti,t
JL that will
a Vu
ne-A f0r in" FstT +Th-e very namber .0f a^"
stitutions
provide such a tempts to
/o\

commitment

« d
s!a« the postwar boom. While tern- certain limitations to purchase
!r°e dLungwUh'a hypo'th^tkal
^debentures
of the Homeif Loan
Unquestionably,
any¬

provided

Secondary

a

advance

lender, pouring funds into
ready glutted market. In
words,
the
instruments

conven-

the VA and FHA interest rates
and until research has

Constitutes

its

the™ ^Ya^YuctuMonnr the throughout

resolved unless action

Market

m

•

<?Peratio!?s
situation that cannot satisfactorily
avail- be

Therefore, I think I

three

J

with

policy, became in effect

on

What

on

•

important part in determining the
funds, as is evidenced by

otherwise

H°m6 Wlthuthe secondary market issue,
have

no

There

cure.

can-

J1

does

secondary

not

rate

liquidity

1 ^

though

measure

flexible interest

a

tion that the interest rate plays an

A. J*

true

Home Loan Banks

If FNMA cannot

and

is to build up their own
portfolios rather than to provide
concern

its

acquired

if

institutions

function, of able.

providing a place from
which
mortgages might be sold, because

and

earnestly contend that the
mortgage market has no troubles

governmenthadTstab- ^

interest

flow

portfolios,
and*
of
course, they do ndt lend to other

"

which the

the

got

once

their

liquidity, therefore, is extremely of funds. If
they provide
restricted. Actually, the function
ondary market at all, it is

lished

loans

guaranteed
on

mortgtges

,

"I V\

statistics

distribution of funds, even
lenders, they rarely available, might be misleading,

other

mortgages that have

into

insured and

on

-

While

miums

,

on

mortgages.

„

_

purchases and sales of

This question must ba

Volume 177

Number 5194

.

.

The Comviercial and Financial Chronicle

.

(693)

21

'

added to the others
requiring seri¬
ous study.
'
j
■.
.

.

There

that

-

.

still

are

Restore Gold Standard

.

other

Home

Loan

Bank

might be broadened
tain

the

for

If

would

this

market

facility

jnould

the

to

as

could

currency

ob¬

sought

be

adequate

an

done,

establishment, by ratio from 24.6 in 1941 to 10.5 in
Administration in Wash- -1945.
ington, of a gold standard and a;
"The distortions generated by
redeemable currency is becoming - our irredeemable currency and

0ur

provided?

proposed

secondary

oai
facility deal
only, in insured and
guaranteed mortgages, or should
its advantages be also extended to
i

v

take

in

™

,,

mortgages

ernment-insured

should

it in

available

I

am

credit

conventional

home

tion

I

sure

of

day

paying

and

must

yet

for the
mon¬

market

the

to

if

seek for these solutions.

early 1930s, after the Home Loan

dollar,
and
provide a

Bank Act and the National Hous-

sound

are

tain

if

to

the

bloodstream "<

Waltor £.

.

V"

in

"In five
fivp
"In

First Boston

Group

prerequisite

nf

nut

-

Co. 33/s% Debentures
Public offering of $15,000,000 of

3%%

civ

,

a

recqpt entrant in the manufacture of organic chemicals, was
made

Feb. 6 by an investment

on

banking
First
tures

headed

group

Boston

Corp.

by

The

The

deben-

priced at 101V4 % and

were

accrued

interest, and mature Feb.

V 1978.
Beginning
fund

will

least

65%

in

of

sinking

a

to

retire

at

the

issue prior to
initial redemption
101.13
decreasing
to
an

of
100% in 1975. General redemption
prices range from 104y4 prior to
Feb
1
1954 ,° 10°7i ate ftb.
price

-

i.
Since

•

"*•

II,

T
*

•

$4.68 in the preceding

1*

omlinson

rpcnmntmnc

in

the

Carlton

indicated that there has been

Pennsylvania, all of which were
seriously influenced by the
strike
picture, made • uniformly
years, Mr.. Tomlinson good < year-to-year
comparisons,
his .Poniton Farm, at Despite the disappointing showing
N. J. His warm-hearted by Erie, however, it is widely
and engaging manner held in financial circles that the

were dominant traits in his character and as a result he had a host
of friends
friencis in.
in and out. of Wall St.
Mr- Tomlinson_
Tomlinson was
was born
^rborn in
in New
New

stock still has considerable appeal

Brupswick, N.. J. sixfy-seven

reorganization,

College : in
War

I

he

-

The only time our

Tnin\*

for

income

and

for

price

some

appreciation. As the capital structure
ture

streamlined by judicial

was
was

the

and

Halsey,

bureau

•

.

•

~

+•

pleted

T

not to understand thej his- aries Board of the American Baptory of people's reaction under an tist Convention with which J.
seem

!.■

irredeemable

;

the

1
of

close

delay

World

in

f®!!?1
the

'

'

currency.

,

it is felt that Erie is in

resuming
fact,

redemption

dis-

that fthe

fr°m

a

-

.

,

x

-

L

•

'

_

_

Da vies & Co.

J

j.xi*

by

u.

equipm^^
single door all-steel box

of

pound capacity, three
1500 hp. diesel-electric road switch

the old

estimated

motives,

Other
-

"f IL

7h

mtip

T

with
to

in

view

™

lzea

J?

rtan

th»

hp.
loco¬

generators,
than

less

not

members

of

"

under-

the

writing group are: R. W. Pressprich
P^ch &
& Co.:
Co.: Freeman
Freeman &
& Co.;
Co.; The
The

Pollock & Co.,
Hutchinson &

Company.

company.

pa^o^th "common

Two With Harris

regu-

$1.0Q

per

--

share per

annum

and

/

-

soiling

n

inthe

Upham

(Special to The Financial Chronicle)"

ltf"^®OSroN, Mass.

—

Adds;:

H. Golden has joined the'.staff of 'An
Davies & Co., Security Building.

1500

switch

steam
cost

?f ntteniariv imfnl Hlinois Co.: Wm. E.
Jerreds»
This is particu
a y
Inc.; and McMaster
tunaie
of the haDDV divi-

-n

*

two

road

$3,804,013.

on

^

and

diesel-electric

IPrV

cars

100,000

early in
failed to
the fact

se-

railroad
500

locomotives

ganizalion consummated
the
s has apparently
uraSe 1
memory of
heavy debt structure and

be

to

are

standard-gauge

new

>. ..is the last three years the_
become
(Special
4*1 *7fxpayments^^have
vc
uclwiuc
to tutThe 1?rKriMPtAf
financial chrointcle)?
kave amounted 4/\
to $1.75 a year: 15?ve.
LONG BEACH, Calif.—TlrOmas^rfhis gives a very handsome yield ;^aTrls» Cpham

--V.

The

are priced to yield
to 3.75%, according

These certificates

cesses that characterized the old

Sy sfnee

have been identified for

-

.

t

2.50%

cured

consummation of the
notyears.
to know,reorganization
or to
flrst at the rate of

longest'

expended-^Ps^ess recession and deoression
approximately $60,000,000rforexJ our history came (1873 to
-jpansion of its
.producti^-«s^e|^^/:i;®AareB, 1879) under *an *rredeemmodernization of eMstmg" facili-^ - iable currency .which^. with. the
ties and diversification ;of
plantr Glvil War, had invited and made
.

w.

and

position conservatively to pass ta maturity. Issuance of .the! ceralong a larSer Proportion of earn- tificates is subject to the authqnin2s to stockholder than are the zation of the Interstate Commerce
*5
sl0CKn0iaeiS Wan are ine commission

Herbert Case of the National City

-

has

company-

x

""M
1
u~ today
4-J
J iFflrmpr«
nnH r^nrdP
"Those people
who
advise
Farmers Trust
Trust Cn
Co. and
George w
W.

-

xu

the

Fe"ner

Inc.

r?

20, 1954

n

and deposits ex- Tomlinson hpramp a mpmh'pr of
panded as business increased, the
& Beane and when the
demand for Government securi- lattc firm mei opd to form Merrill
ties swamped the Treasury staff, Lvnoh
Pierce
Fcnner
Beane
more gold was turned in for pahe became partner of the consolper money than paper money for
iHated firm
Besides his membergold.
ship in mmiy New YOrk
imd
"There is nothing new about New Jersey clubs, Mr. Tomlinson
this business today, excepti our
our served on the Executive Commitpeople who, like those of 1878, tee of the Ministers and Mission-

Co.
i

tojeb. 20, 1968, inclusive.

as

money

r

serial equipment fru^
senal
trust certificates,
certificates,

was

of

&

vf
900,000 International-Great NorfheFn. Railroad of series E£
EE.. 3xk%
3%.%

During 'grams' have "been "vTrtuaify "com- certificates

.

a

f§"

«nie

Stuart

^°nnn?V°n

pro-

distinguished from in %iq
Mr
TnmHnSr three*
involved in a resumpThere is little question but that
«nn
/.Ton
9
i«7Qt
Erie
stock
suffers
marketwise
tion (Jan. X 1879), business ex- Vice-President and General Manln
pansion quickly followed, gold
Psychologically from the onus of
flowed in from abroad, the volin
tre
Mr ■lts
history and the financial exbanks,

con-

Halsey, Stuart Group
Offers Equip. Tr. Gtfs.

property

Wil- improvement and equipment

1906.
was

years

a
a

recession.

in

House,

casePthat oi^ 1842* resumotten<wa^ heac^
thJ Liberty Loan organiurfderteken auring
durfng snarp
sharo bu^
the 2nd Fedeml Reserve
busi- n-T
District*
Government

efficiently

weeks of the current year but it is

also

re-

ness

inoperating

year.

cfty

1957,

operate

maturity at

'

inS f°r the funds, amounted to
$4.57 last year compared
with

Madison Avenue and 62nd Street,;
after an illness of several weeks..

DromotiruDonXPth?Wlaf°!!rrt.d
Ifams
mptly upon the heels of
World
unaeriaKen

ment

about. $2.4 million below the 195L recent years. As recently as 1947level. This drop in business was the transportation ratio was above1
not fully compensated for by re-. 44%. Last year it was below 41%
duced costs, and net income before and it seems reasonable that 'it*
sinking and other reserve funds can be reduced below 40% in the
fel* off some $267,000. Common reasonably near future. Traffic "
share earnings, also before allow- was down in the first couple of

.

sinking fund debentures of

oiamnnH
Aitcii Pn
Diamond
Alkali
Co., a major producer of basic inorganic chemicals

and

con-

gross revenues for the year dipped

.

Saturday

to
to-ecoeco-

p

Offers Diamond Alkali

operations are

area,

siderable betterment more recentThis showing of Erie last year ly
and the prospects over the
Everett T. Tomlinson, a familiar was in particularly sharp contrast coming months appear favorable,
Wall Street figure and a partner to the experience of the other All in all, then, present indications
in the firm of Merrill, Lynch, large eastern roads. Baltimore &
point to higher net in 1953 than
Pierce, Fenner & Beane, died last Ohio, New York Central and *n 1952.
.

nomic health.
Lth

a

■

Snahr

'

P
ft *T
kverett *

that have been building up
during the last 20 vears but it is
-necessary
,y

of

'

eases

a

Dr

'

,

*~4

4

redemption

Spahr

basis

actually

ing again with basic issues.; We
an
opportunity that should

so

should

deposits at $35
of fine gold in order to

eluded.

lost.'A change of Administration
in Washington gives an o.pportun-

have

and

every benefit and assurance
possible from a purified monetary

of redemption no\y while they can
safely do so. Later may be too
In late
late," Dr. Spahr continued.
/ ..lived ,,on~
ity and should provide the in- *
"Resumption alone cannot cor- Bridgeton,
spiration to start our minds work- rect all the serious economic
dis- simplicity
not

resume

credit

get

passed, there has
little original thinking

blurred

that

per ounce

were

been

business in the New York

a

all our money and

lor business and finance," was
been very
urged in a statement by Walter E.
done
about
the
mortgage sys- Spahr, Executive Vice-President
tern.
Since that time, we
have of the Economists' National Comproceeded
on
a
crisis-to-crisis mittee on Monetary Policy.
basis, improvising as we
went
*
"Congress and the President
along until our sense of direction should push through resumption
has

ou^ G^vemment

safe¬

guard

Since the

over

consumer

economic

health,

practices

mounting

hasten

at¬

we

unsound

r_

20

and

years

involves

last

finding solu¬
tions to some very knotty prob¬
lems.
I hope I have, in spite of
this, made it seem worth-while to

ing Act

-

etary practices
of

muter

adjust- metropolitan

year-end

;

we

are

pay

enough

secondary

•

the

penalties

that the resolu¬

you

if

with "sizable

ments by a number of companies, now fully dieselized. Dieselization
a vast majority of the railroads of of this remaining service will in
period of 20 years have been so ?he country have reported grat- all likelihood be gradual, paced to
great,* and the unfortunate conse- ifyinS> and in some cases substan- the rate at which mileage runs out
quenceS now unfolding in so many tial> &ains in earnings last year on the steam power now being
"directions are so ominOus
for compared with 1951. One of the. used. The work that has already"
-example, as revealed in the evils exceptions to this general trend been done and the new equipment •
of agricultural subsidies, our
huge was Erie* Largely reflecting the that has been installed have revolume of public and private debt, prolonged
summer steel strike, suited in a significant improve-other

to

are

minimize

unsound

said

.

urgent

each
we

non-insured

have

the

questions

by

,

or

As had been expected, and even

new

more

gov¬

addition make

on

convince

by

institutions,

mortgages made
institutions?
to

held

Erie Railroad

'Immediate

secondary

be

National Committee-on Monetary Policy, says a redeemable
is becoming more urgent each day, if we are to mini¬
mize the penalties of unsound
monetary practices.

,

System

originally

scope

it?

so

.

Walter E. Spahr, Executive Vice-President ofthe
Economists'-

raised by this whole sub¬
Is there any way in which

the

hnmediatelyt

questions

are

ject.

*

&■>

William^A.

.

lnw

90s.

& Co.^ 136 Federa.

Street.^ Mr. Barron wa? formerly

Kopel Joins Hirsch Co.
ihcltiding^: chlorine, alkalis, siliT ,will have to experience a severe
cates, "chromates and calciam ear-" business • depression
before our
benates, in the- last twa years Government officials will shed
expansionhasbeen made into'the tlteir1 illusions
field

of organic

^

.

.

Proceeds

encing

from

will

,

the

be

fi-

current

used

to

repay

$5,800,000 in outstanding debt and
for

a

sion

further program of

modernization

fication

estimated

and

to

expan-

amount

to

Since

1946,

property

the

company's
had

account

A-A

net

A

.
very important consiaerat-^gtreet>* members of the
tion for. our people is that while Annoioc tn-npt Wvphontfo
Angeles Stock Exchange.
gold ratio of 10.8% is more than

adequate, in the light of experi¬
ence, to permit resumption of redemption, our Government, by
listening to the arguments for de-

increased

6.5-7.0%, this
opinion, will

the

$20,400,000 to $65,000,000 at

close

of

1952.

Consolidated
company and

the year
«7<innn

673,000

net

its

sales

1952 amounted
and

of

the

*

net.

•




.

wervrt

/I

■

AA1*f

Joins Hannaford Talbot
,

Broad Street,
City, members of the
Exchange, an-

York "Stock

•

-

^

to

elated with Hannaford & Talbot,

,fro7} 24-6 to
f*3
nation then, m my Hodson
Hodson
•

have

entered

the

credit would then be necessary to
raise the reserve ratio to the zone

reasonable safety..

,

.

road's

cession

r

'

-

.

Rogers,

TnrinT'strppt "

"Mr

£*22rS
industrial

activity.

Another

Guaranteed
re-

Securities

long-term down trend tor many

years.

Erie has been engaged in a com¬

(Special to The Financial Chronicle)

prehensive property rehabilitation
and equipment program. It is gen-

}£% ANGELES, Calif. Fredt"®?-

era]]y fejt that expenditures for
capital improvements from here

"The'distance from 10.8 to 7 % Senez

Railroad

formerlv

Two With Hill Richards

...:iu

Specialists in

with Gross strictive factor is anthracite coal,
was formerly with
Gross, ^ uge of which has been on a
Barbour, bmitn & lo.,
trend
for manv
was

i..

position in periods of re¬
or depression. As a corol-

LOS"AWGELBrcSrSu*. ^
however it bends t° reduce
the earnings leverage in periods

zone.
Resumption then and Morgan & Co.
probably be a dangerous
undertaking.
A
contraction
of

;

York
*"

AIM

are now with Hill Richards
to come,
'"is not great. considering the & Co., 621 South Spring Street, on, and for some years w;fV>
was
rapidity with which our Govern- members of the Los Angeles and should be quite modest. With the
ment and Reserve Banks ran the San Francisco Stock
Exchanges,
exception of some of the com-

to: $76.-

income

$5,462,000.

A

Hirsch &.Co., 25

Aiir

danger

subsidiaries for

4-1>«

«.n

;

-....

-animal ^ew
turn tends
-

Los eastern roads to wide fluctuations .™rch "and"'statistical^ department.
in
irHnelrial
ppmnmv
"This w^^Crr.^-i
in
our
industrial
economy. This Mr
Kopel was formerly with
adds an element of strength to the Lehman Bros

would
rom

1

.

1

vegetables,

currency.

a

tnao«/rac2.

,

,

and

products, etc.. This- m

(Special to The Financial Chronicle)

diversi-

$14,600,000 for the period 1953-54.

,

fruits

about

chemicals, such of an irredeemable

V agFa
^ turar chemicals,, .solvents and
vinyl plastics. ;
.

With Crowell, Weedon

.

....

.,

,

.

„

CUAIAHTEED

KAIIROAP

25 Broad Street
*

•*

;

STOCKS-JOWPS

New York 4, N. Y.

*

Telephone BOwlitiy Green J)-fi40®
Members Nat'l Assn.

Securities Dealers, Inc.

22

The Commercial and Financial Chronicle

(694)

of

convention

Gold Coin Counterfeiting in Italy

the

are produced.
Says coins are of legal weight
Holds, although sovereigns and gold coins are
longer minted in U. S. and Britain, international action

Continent has

received

fair amount of publicity.

once

But it is

the

United
States that

steps

busily

gold

who

r

e

i

m

m-

prisonment

they

Dr. Paul

this

on

side

Curtain, those who

*''double eagles"
trade

of

coin

practice their

can

impunity. Thanks to
the judgment of the Swiss Federal
on

become
and

Aug. 19, 1952, it has

lawful

to

mint

now

privately

sell

gold coins that are
in active circulation

longer
their

no

by the
against
the
Spaniard, Beraha, and the Italian,
Bernardi. on the ground that they
authorities

guilty of counterfeiting

were

ereigns.
the

sov¬

The Swiss Federal Court

rejected the

demand, whereupon

Italian

Government

with

questionable

logic, dropped
proceedings against the two

a

the
men

and their associates who had
been

c.might

and

held

Italy pending
was

imprisoned

their

trial.

in

There

legal justification for this

no

and

change of attitude.

London

them.

two and

some

to

a

severe

Justice.

Its

authorities

the private mint in
closed down when

was

authorities decided to
last

year,

was

re¬

By November the Zurich

Correspondent

of

the

able

to

London

that

report

privately-minted coins were com¬
ing to the Swiss market from
Italy in ever-increasing quanti¬
ties.
What, is more, emboldened
by their immunity from prosecu¬
tion, the producers of coins ex¬
tended their activities to

iUnauthorized

minting

the

cover

double

of

eagles in addition to sovereigns,
'Hapoleans and some less-known
b'old coins.
All

be

these

of

Indeed

was

that

liorities

decided

ground

tion.

The

itable

the

for

and

fineness.
on

that

Swiss

legal

au-

there

criminal

the

to

partly
that

reason

for

alleged

are

weight

it

^round
itO

coins

full

was

prosecu¬

why it is prof¬

enterprising

indi-

\dduals concerned to practice their
unconventional trade is that there
13

a

<;ver

ing

substantial premium on coins

their gold value.

they

ineans

than

gold

pieces.

are

more

bars

cut

Hence

the public in

Greece,

Kong,

the

etc.,

For hoard¬

by people of small

purposes

convenient
into

small

the willingness

of

Switzerland, France,
Middle

to

pay

East,

Hong

premiums

of

anything between 25% and 33%,
which
the

secures

producers

ised coins

even

United
As it

people of standing

are

States

turers,

of

f

u

a

c-

is,

ample
of

if

the

profit

for

unauthor¬

they do not de¬




be

not in

most

of

The

1953

Indus-

tries

Fair,

"An

the

trade
ago:

prestige.

this should be

so,

no

Lord

Rocntiale

had

a

in

not

action.

take

fact,

increase

small-scale

by

placing

posal.

small

object

When

it

as

of

sovereign.

a

suggested

was

the

problem, it should cut the sov¬
ereigns into pieces and replace
them by its own sovereigns the
unexpected
Royal

reply

Mint

ereigns!
tnem

that

was

possessed

It

could

no

only

instructions

on

Bank

of

count

of

event

the

that

on

ac¬

In

any

Mint

its

testimonial

and

fineness

should

for

would

correct

if

even

—

confirm

the

When

the

ruling

of

was

question.

It

tests

Swiss

Swiss

a

Law

coin

a

and

that

remains

coin

current

a

under

unless and until it is

by

Royal

has

certainly
of

case

not

been

They

might of the British Law

even

more

in

foolish

who

too late

the

call for

at

the

which

Swiss

the

not

were

nroceedings.

The

British

even

In

a

anv

County, Pa. The

auth¬

partv

to

lation of

it is

case

th§

are

just

a

form of merchan¬

The position is the same

of

territory

political

action

consumers

estimates

and
in

obtain

Convention

1952

its

the

1929.

definition

that article

are

of

The

that
of

commercial

supplies;

gas

Allegheny County.

wells

budget,

the

31,

produced from

about

53%

balance

of

Coun¬

terms

money

its

being

its

must

of

CSpccip.l to The Financial Chronicle)

evidently worded

loosely. Another international

HARTFORD, Conn.
A.

&

Wood

is with

—

Kenneth

Eastman, Dillon

Co., 75 Pearl Street.

sectional

city, all
be

one

of

the

giant Earl's Court exhibi¬

for

A small-craft section—

family-type

medium-priced,

vacation

boats

—

cabin-cruisers,

sailing

one-man

also

be

boats

featured.

University, holds this

the

• new

to

expenditures
the

balance

make possible a

reduction in taxes,

both corporate and
said.
"In
one

reductions

No!

broad

political

is

only

overhauling

considera¬

there

alleviation

tax

Administra¬

guided more by-eco¬

than

tions.

the

expect

tion will be

nomic

for

individual," he

considering tax

may

in

and

budget

but

of

need

a

also

the

for

entire

tax structure."

George Dahlin Joins

Goodbody in Chicago

this

and

taxation

balancing
price and

as

,

Federal

reduce
order

tax changes

over

the
wage

refunding

operations,"
asserted, "the Treasury
not only
the in¬

consider

creased
but

of

cost

of the debt burden,
importantly, the effects
operations on the liquidity

more

financial

business

institutions and large

concerns,

well

as

the money market and

as

on

business

on

activity in general.
"A

large portion of the floating

debt

can

term

obligations attractive to

be

converted

bank

investors

have

the

into

funds

for

such

Otherwise, such

merely

leads

long-term
tal

a

to

first

market

will

George

invest¬

policy

a

increase

rates

not

shifts

At
1953

CHICAGO, 111.—George E. Dah¬

be

lin

has

taxation

versus

ready

a

formerly

to

"quite

evident that if the budget
is
not
balanced
during
a
period
when the
economy
is operating
...

practically

at

capacity,

it

head of

was

He

with Langill & Co.

Marache, Dofflemyre Add
(Special to The Financial Chronicle)

LOS ANGELES,
J.

Administration will favor the

never

as

department.

for many years.

balanced

was

Street,

for

short-

budget, Dr. Nadler holds that the
adding that it

Salle

in
can

long-term Treasury obligations."
On

joined Goodbody & Co., 1

North La

the mutual funds

and

least during
the capital

from

E. Dahlin

non-

decline in private capi¬

half of

large-scale

an

interest

expenditures.

the

long-

only if the latter

ments.

new

Eastman, Dillon Adds

under

fac¬

over

and

well

as

Dr. Nadler

latter,
on

special

prefabricated—will

controls.

result in

the company

own

it

all

purchased.

,

terfeiting of

popu¬

In the 12 months ended Oct.

•

gas

to

a

1.760,000 and

approximately 55%

residential

re¬

has

area

than

Evidently what is called for

ternational

too

more

company

serves

modification of Article 2 of the In¬

the

service

the

sale

Pennsylvania and
Virginia, including the City
of
Pittsburgh
and
surrounding
municipalities in Allegheny

Federal

right

the

along

houses will be set up on one floor

Administra¬

precedence

of such

is

and

pressing

tion,
takes

adjustments

"In

West

came

any

'

is

embracing approximately 225

garding American and other gold
is

its

gas,

to

by

gap

the

problem

ing
Marcus Nadler

will

stock

business

production

of

t ions

domestic

1953

which

preferred

company's

natural

They

coins.

the

this year,
f u nd i n g

most

be

estimated $7,200,000.

new

purchase,

feel that, since sovereigns are not
in actual circulation in Britain,

dise.

an

The

complete

e

comes

comprise

construction.

each share of preferred.

doubtful whether the Swiss judges
would have been impressed.

they

bank

mon stock of the
company at the
rate of four shares of common for

to affect the result of the

before

Court

repay

convertible at any time into com¬

refusing to

argument

r

sale

to

program

obliga¬

tions
due

vol¬

of short-

opera

communities in

However,

the

to

points

because

term

per

from operations will

sufficient

value.

orities

and

construction

accept the sovereign at its old face

trial

part

and

large

a

preferred

for

worth

enough

of
of
the features.
A complete school,
a
clinic, and different sorts of

Marcus

ume

this amount together with cash on

is

A

it

dinghies,

Hanover

out

of

outstanding

incurred

hand

legal tender, and anybody
who is foolish enough to offer a
sovereign in discharge of a liabil¬
ity of £1 is entitled to mobilize
anybody

of

well

budget balancing.

offices

Hanover

to

con¬

from .the

in

used

S.—not

dollar

but

means,

will

customers,

The balance will be added to gen¬
eral funds and it is expected that

in fact

against

4.50%

value) at $102

par

realized

be

loans

in

Courts

shares

plus accrued dividends.

are

the full

100,000

($100

will

which

done

sovereigns.

the

of

offered

Co.

Co.

of

worth

road."

for

Administration problems,

on

Beane,

stock

-

the

of

Gas

$7,000,000

in

Realm

—

Economist

Bank

Merrill
&

share

Funds

demonetized

Proclamation

&

U.

the

close

we

In his second report, as Consult¬

ing

yesterday (Feb. 11)

vertible cumulative

British

the

Co.,

Fenner

Weld

issue

Equitable

legal tender

of

White,

new

Federal

called

&

Pierce,

the

dur exports

year

million

$401.9
to

pressing problem, taking precedence

Nadler

and

was

Treasury

is most

der,

Peabody

not

Nadler, consulting economist to Hanover Bank

Dr.

Lynch,

pointed out to
representatives who beseiged

press

the

Marcus

underwriting group headed
by The First Boston Corp., Kid¬

for public sale

the

indeed

of
French coins.
prestige

issued

weight

its

>

are

we

Refunding Main Problem of New Regime

An

Court
that
sovereigns
are
no
longer legal tender in the United

Kingdom

Debt

be
the

Gas Gonv. Pfd. Shares

be

prevailing

of

news

will

secure

Group Offers Equitable

understandably reluctant to give
the privately-producecl sovereigns

are

demand

and

the

the

institution.

Royal

we

produce

from

England and

see.

how

of

million

$205

tion hall.

make—and

can

of

exports

more

really the

war

total

and Professor of Finance at New York

the'

American, British or

sov¬

meeting

great deal more is

a

of

made the

jumped to $316 million, and
they were up to $384 mil¬
Last year we sent a record

of bars.

than

steel.

we

1951

lion.

Dr.

So

need

shall

you

The next

eventual dehoarding of coins than
involved

the

difficult to

more

men¬

monetary

for
And it

gap.

the

world

goods Britain

amount

primarily

dollar

much

the

for

the

meeting

gold

It
we

before."
"For

since

time

products—

expect

we

ever

continued:

first

in¬

to

of

extent

available

gold

buyers than
He

Brit¬

dump-truck.

a

had, and

ever

of

be the best Fair

going to

quan¬

is bound

so

total

is

hoard¬

additional

industrial

dress to

a

not to have

gold

It reduces the

purposes,

the

to

do

the

hoarding.

crepancies in the fineness of such
a

To

from

it is of

practical importance

some

ing

In

cross-section

ain's newest

why

as

year

a

figures released a few days
in 1949 we exported to you

here

out

great deal of what we are turning

Even

reason

great

indication

goods.

we

resentative

were

bettering our position—and
either—is shown in

32nd

there

you

Kipping

got it, and

it,

tre¬

slowly,

a

of

our

and

war,

helped

that about

Norman

we

display

many

remember

Sir

tioned

a

over¬

have last year. You

us

ago

Well,

of

been

may

Lord

British

of

starting to go ahead.

are

able to let

To

have

we

backwash

have

Rochdale said

case,

beginning
distrustful, and since they

crease

the

was

coinage of the

eagles

applied, but it is hardly accurate
enough to ascertain fractional dis¬

In official quarters

"Statist"

n

we

enormous

mendously by the steel

"The Fair will

discredit

to

tities of coins at the hoarders' dis¬

the

opened.

double

and

water test invented by Archimedes
some
22 centuries ago could be

fective action.

of

the
Italian
choose to submit to it.

"action

It

become

the Governments concerned should

half centuries ago,
test.
It is true, the

theless,

take

debased

*

considerations

a

Government to take swift and ef¬

Italian

well

course

and Great Britain.

to

The scientific and

the borders of Switzerland. Never¬

the

the

request

Federal Court's judgment reached
London
everybody expected the

Court

result

due

sovereigns

are

the

with

ternational

a

in

and

far

ruling is not legally valid outside

As

Per¬

American

a

the

come

in

variety.

new

large extent

very

"We

National
Union

them,

quantities and

now

President of
The British

M

making

are

Vice-

held by us.
It
is our show¬

view that they are correct.

.

Washing¬

result.

and

Wings Club

Thursday,
Jan. 29.

produce

Even so, the
standing are not
happy about the whole busi¬
of

Alter all, the
Swiss Federal Court is not an In¬

Italy-which

that

British

taken

The

at

the authentic coins.

Royal Mint that, in order to solve

The judgment was the result
of
extradition
proceedings

Italian

the

been
in

or

editors

news

Swiss

banks

Stage "Trade-Not-Aid" Show

is going to be
a big trade
year for Britain, Lord
Rochdale told a group of business
year

be

in

countries.

own

achieve

to

may

Isaac Newton, Master of the Mint

with

Court

pri¬

technical problem involved would
have put even the brain of Sir

Einzig

if

caught

are

the Iron

London

in

Coronation

tempting for private interests to

to assay

are

liable to longt

Britain lo

out and everything we intend to
position to check the turn out during the next year, it
'is
the largest industrial
•fineness of the coins they' may
fair in
that
their
weight and fineness
the 'world, designed especially for
should be checked. The bank in¬ ^prefer to be on the safe side, lijke
the Swiss banks do, in refusing to
businessmen.
It runs from April
sisted, however, - that the
coins
The considerations 27 to May 8. There the overseas
must be returned intact, they must ,deal in coins.
involved are thought to be largely buyer will be able to see a rep¬
not be cut or mutilated in order

coins.

notes

produced

Mint in

print the dol¬
lar

have

to

appear

cations of the present position.

the
specimens
of

appearance

no

suspected sovereigns to the Royal

pa¬

whereas

those

and check the activities

outward

as

producing

would

noticeable difference between the

is

They avoid dealing in coins
as
possible.
One of the
leading Swiss banks sent in some

en¬

concerned

private mints.

haps

ness.

per money but
also American

And

coun¬

there

instances

many

very

gaged not only
American

ton

they

other

and

Yet up to the time of writing no
either

which

coins

the

and

more,

Treasuries do not appreciate the
importance of the practical impli¬

In

vately

counterfeiters
in Europe are

in

the

once

Government

more

of the

!

terfeit.

a

not realized in

offense

Governments

should be taken to end their private minting.

on

inal

eagles,

then have to institute proceedings

Sovereigns

base

of

Italian

and fineness.

LONDON, Eng. — The recent
discovery of forged dollar notes

ing

sovereigns
and
Napoleons could be made a crim¬

Pointing out, according to the Swiss Federal Court, there is no
crime in producing gold coins, Dr. Einzig calls attention to re¬
opening of private mints in Italy where U. S. Double Eagles

no

participating

loophdles. The unautnorized mint¬

By PAUL EINZIG

and

the

Governments could easily stop tne

...! Thursday, February 12, 1953

Corcoran,
E.

Don

Stuart,
have

Ruggles,
and

T.

William

Harvey

become

Marache,

Calif.—Thomas

Jr., Ralph

L.

Huff.
P.

connected

Dofflemyre

&

V.

Walker

Co.,

with

634

may

be balanced."

"Every effort must be made to

South

the

Spring

Los

Street, members of

Angeles Stock Exchange.

41

Volume 177

Number 5194

The Commercial and Financial Chronicle

...

carded;

What the Eisenhower Administration Should
Do to Promote

Weil-Being of All the People

strengthened.
ing

for

come

to relinquish
business projects.

government

emergency
The

nation-wide

investment

banking and brokerage

of

concern

of

some

covering its business
in

the

In

1952.

year

opera-

in-

an

The

laws

securities

our

govern-

business, for
been in force

the

expense

the

of

lose

sight of
the fact that it is the venture capital of individual investors such
as you—to whom we pay tribute
never

years.

They have
accomplished much, but it is now

the pages following — which
made this country great.

time to

restudy and revamp some
them, not only for the benefit

"We must see to it that free enterprise and private ownership
are used as a means to strengthen
our freedom. We must use them

18

the

ourselves, but
good of the country as a
'

.

"Certainly it is also time for

its

*

our

government to relinquish some of

the-powers

which

it

pre-empted

in

fully to do

more

of $6,329,405. This compares with

$9,481,359 earned in

must

now

almost

whole.

themselves.

"We

at

for

for

little hope of becoming capitalists

exploited
other.

example; have

of

'•

so.

"We must make sure that the
financial policies of this country
of ours are always—as Lincoln en-

1951.

Federal income taxes amounted
to

an

estimated

charitable

$4,200,000 and
totaled

contributions

$200,093, leaving $1,929,312 for the
partners who participate in the
profits. This compares with $2,500,316 in 1951.
In addition to regular salaries,
the firm paid employee bonuses
amounting to $1,348,702 and the
partners contributed an additional

$607,349 to the employee profitsharing plan. Contributions to the
profit-sharing plan, which was in-

from business during periods of visioned them—'just and gener- augurated in 1945,
emergency. And it is time, too, for ous and prosperous ... to all.
236,268.

$5,-

now total

...

Beane,' ^"SuS^'annuaf^ an7aworW™wi^edep^oli,'and
port
tions

indi-

foster

of shareholders and

cial organizations can provide nation's venture capital needs
if favorable legislative and tax climate
prevails, authors hold

has

which

opportunity and industrial
growth should be reinforced and

Smith,
Managing Partner, of Merrill Lynch, Pierce, Fenner & Beane,
urge adoption of principles which will assure the greatest
measure of
prosperity to the entire nation. Stating that finan¬

time

those

vidual

In introductory statement accompanying firm's annual
jreport,
Charles E. Merrill, Directing Partner, and Winthrop H.

23

(695)

Lincoln's concept of a creative
wincn
eveiv
capitalism in
in which
every riu/eii
citizen

b/returned to
ownership. Let the gov-

ow.ne* Projects to
PriYa*e
ernment

Financial

Results

for

1952

Financial Results for 1952

According to its financial state-

firm
in 1952 was $43,614,818, down
$697,413 from the preceding year,

govern
keeping its m.ents, the firm of Merrill Lynch, w aic operating expenses were up
might
sharp
in
Amprira
Pr°Per place as umpire, »as arbi- Pierce, Fanner & Beane, in 1952 $3,559,546 from 1951, when the
suffprpri
fnrthnr qpthapk
And
frator and as guardian of the pub- had a net income, before Federal expenses ran $30,638,334 compared
tS next 20 years of New deal lic's best intei'eststaxes and charitable contributions, with $34,197,880 in 1952.
and Fair Deal, of inflation, war
Second, we must modify our
'and cold war, placed
additional tax-structure to encouragejhe mstrains upon free enterprise.
vestment of venture capital: Let
and Dollar
"The
government moved
into us study the effects of taxation
"Monthly
Review"
of
Federal
Reserve Bank of New York
many areas which had previously
upon -corporate financial policy,
sees an overall
been the province of business ahd -and-on the basis of our findings,
improvement in recent months, culminating in
industry.
It built and operated establish a tax system which will
aggregate holdings of almost $20 billion at end of 1952.
ccujMaiism

own

—-

=

--

a

a

Foreign Gold

power

plants. It constructed trans-

mission

lines.

network

It

of

a

vast

administrative

bu-

E.

regulatory bodies.

And

an

it

imposed

H. Smith

Winthrop

unprecedented

both corporations

(<0ur

total

net

^

publk and

vate debt during these years, due
to war and inflation, soared from
Win- $175 billion in 1932 to the astroPart- nomical figure of $561.5 billion

troductory statement to the report,
signed jointly by Charles E. Merrill,

Directing Partner, and
throp H. Smith Managing
attention

ner

for

if existing

private finan-

organizations

the
ine

demands
aemanas

for
ior

sausiy

capitalcapnai.

venture
veniuie

during

eencv"

The

periods

of

text

this

of

+

statement,

Federal, state and local debt

t

entitled

country

who

One

dom.

sought

of

the

the

was

we mortgaged our
in Qther
omer words
woras, we
mortgaged our
future.

All,"

"At

the

his

be

to

centuries

payment

as

America

to

passage

sev-

life

of his working

for

the

owning his own
shop. And our forebears'
self-reliance
and
independence
stemmed in large measure from
up

or

the fact that they had a personal
stake in the country's economy.

"Hundreds of years later, Abra-

ham Lincoln expressed this same
idea.
Speaking to Congress in

1861,

be

said:

When
the

poor as most do m

one

starts

race

of life,

free society is such that he knows
he can better his condition.
.

The
in

prudent,

these

awhile,
a

penniless

States

saves a

labors

.

.

beginner
for

wages

surplus with which

yt length
,t0°LSiK0ri..
and °; b'mSelf
hires another new

at

d

beeirmer to helo him.

This

is

tne

f,
:70ss
regulations, ror put
blunt y capital gams are not inc0™e. and any tax
themr.ls
^obbln£ more or less than confis-,
.

of

wTrII

world

u

raised

It,

\

about

I®

sale

J9

$

-was

around 6 %

the

by

common

of

equity

m

'

h upori debt

study made by basis

aopp?ylaVJthto
...

halanpprI

^ould

take

hud set

to

steDS

basis

Thpn

Business Conditions,"

and

ffie

off

nav

&

1949

they

miii™

Iiqr

mi

sbould take steps to pay oil the $19.8 billion in June, 1951

mortgage which we have imposed
fenerations

f,,turP

sound

A

clined to $18.5 billion

w

ind

Vpar

in

rparhpH

de-

March of

tiqq

of

with

the

development

production,

mass

although

,

nients of human

.

.

,

,

,

beings lost touch

compa-

capital structure and a balanced lion by the end of 1952.
..

,,

veior,menij.

.

and

long_term

.

growth

of

a

corM

P°r.atl0n

nation.

i—

—

When

weaken

we

and Dollar

Gold

our

monetary, system with .debt, we
weaken capitalism itself—we open

Movements

,

accumulation of gold
dollar reseryes during the
the study reveals, took the

Foreign
year,

ihe *or to financial collapse ariH form'
its, inevitable bedfellow—statism. rather

predominantly

of

dollars

than of gold. United States

"Fourth, wc must educate em- net gold sales totaled

only $163

pIo3/ees'a"d the American Public million during the nine months
concerning the function of private

ownership:

The employee stock
ownership plans and pension and

ended December
TWemher 1952 while
While forft.r.
eign countries dollar holdings increased $1.1 billion during the1

same

°"r

corporations

sound

are

period.

During

the

prived them of
in

the

which

welfare

they

the

conveyor
a

sense

of

the

worked.




assembly

belt
of

de-

sharing

firms

They

for

held

r

represented

repiesentea

'

payment

r\aeicL

7,

Western Gei many)

obligations

Eund members.

'

Tn

Ihia

lacf

nnnrfpr

_n)dp d
?d. ,S223
w

L,Tn«

r„

millioni

European

countries

vyestein European
countries
the Organization

ticipating in

Eur*LeJ

million) "

for

CooperatioA

Economic

the

"Review"

Si/S,

^ernatiJnal

rate

icttc,

npf

eo

we

^uiredbffoieigncoumdl^Ju"

intoactTonthe

re¬

*

position

economto

^
fynlH

eii

l

/.'The over-all improvement dur-

,0{

»

an

recertain

by

^S^s^
i

sufc-

ot

bv the German Federal
,rxr

lc ^

ei)Tu

second

quarter of 1952, the United States

Kv

whose
wuu&c

monthly
inuiinuy

^ach^ ThighT

in September; the rate .stood at
us$ 1.0310 at the

the

Continental

was

especially

year

end. Among

countries

t h e
growth of gold and dollar holdings
marked

in

Ger-

man>'.(s214 million), the Netherlailds (?191
and Belgium
($m milljon). The $16, miUion
<lollar rJse 111 France's holdings

graph, General Electric Co., West'J "t^u^,etlJ? ®at
mghouse Electric Corp
Dow asqin earlierperiods-most recentmLc hv to„$Pv
envisioned?
Have we the fore- Chemical, E. R
Squibb & Sons , duri
Jul
1951LJune 1952_ ™' i10T"ad,™^
sj ht to make capitaiism a ere- a"d dozens of other corporations the forei
monetary authorities
atj
for
,
t f
freedom
a have pioneered in developing emsold gold whenever they needed
n„-Yt that nfumatelv^ 1 b?
of
strengthening
rather iPtoyee stock ownership, plans to to replenlsh dollar balances that SSV^^nkr thTmilite^aid
than destroying
the individual's brmg such people into the fold of had fallen below customary levels, „rra^f3d oSld and ,tol ai ho?d
sense
f independence, of oppor- ,the capitalists
Perhaps the most. s0 now the have been converting fiefpYthe Bank tor lXmational
tunity, and of responsibility? Can .spectacular of all is Sears Roe- their dollar balances into gold glffiemtnts
and
the
E™
jinancja]
organizations such
as buck,s Saving
'
"
when the former have exceeded pavments Union which mav be
Ppnsion
Fund
Almost
kjnd

pto

of capitalism which

..

n..

Lincoln

6.000.000

rx.i

i.

phasized.

"First,

gether with measures to stimulate
we

will have to create

favorable legislative cli-

*

mate in which
a^e.

Certainly

business

it is

can o per-

time

to

re-

experiments of the past two dec-

often

the

yTf

purchase

,

and

i

and

vear

by Japan, and the discharge of

1952

in

a

and equally \ital to a

wi™

npnnip

ership.

Too

•

^

course

examine

and

iast
•"
f-.

iion

scriptions

de_

maJufacturing concerns own States sold, on balance, $1 million
stock ^ their business
th j
nature could not fur- A?"? S—a tl?ougb about 75.of S'H
Tb/ utoted States
"ja'r J°
all individuals who own stock to- $268i million. The United States
"Now
of
the American day are earni"g less .Jb"" ^W;?"0 5®"®'nbeA'° ,sfJ
Ts"
fts
Lvp failed'w th^» tprmi
a year' there are still 8 million 1953, w
J,A.„linpj
Leo,
Deal 7nd
"r families in th.e ,»s,00p-$10.00° monetery stock declmed by
D
j
A
j
ending
and we bi"aek.et and nearly 1 million lam- ml )
'recent acceleration in
de
faced
with
the problem of ,]l,es ln the $10'000 .a"d °Yer,?lass utoted States gold sales reflect"
where to
next
proWem 01 who own no securities at all.
United Mates gold sales retlects
"Have
the
wisdom
and
" "American Telephone and Tele- P
into gold of dollar balances

with the meaning of private own-

line

latter amounted to about $160 mil-

hil

UP0.1] future geneiations. A souna last year, and reached $19.9 bil- principally the

in-

a

great blessing in itself, large seg-

tE?l£

^

i ternational Monetary Fund. The

io„oic

+i—~

fhnc

idxr

]gast' fou^ tj^n"g wil'f j^avev
£e 000 employees have a stake in it. itiese for ap legitimate monetary
rio
Wp hav^ „aid
fh>
things But many more corporation plans puTPoses, the United States maincapitalism in its ideal m
' ti
bet'dre but in view of ^of this sort are needed if capital- tains the international gold bullion
sense-and for a long time here in
Jhe change of political clinTate is™ is to enlarge its scope.
standard.
■^i^a^^'ica, we managed to hang on ^ve feel
they should again be emVSuch programs as these—toWhile the bulk of the^ United
But

currently

to

"That's

it.

data

Western European countries.,

thon

il l?,'

inn

hi

Amounted

Thpv

quent energy and progress and
improvement of conditions to all.'

to

official

York, the results of which are flow appears to mark an improvepublished in the February issue of ment in the positions primarily of
the Bank's "Monthly Review of the sterling area and of certain

we

^ by" shal'es

.knoHw-h0w'to

of

^'too de.-en^ rematas to b^done^

financing.
We
pendent upon insurant
.

a

,

«

too

According to

the Federal Reserve Bank of New available, the reversal in the gold

tem which will stimulate venture gold and dollar holdings of forThe gold position of individual
eign countries, which rose for al- foreign countries was, of course,
tn
*Za ,lW°
from September affected not only by gold purJ [W? must take steps to 1949 through June 1951, and de- chases from the United States but
«reducing our public debt clined thereafter until March 1952, a}s0 by accruals from new gold
5 ef,r
possible moment, have since tended to increase production, by transactions be-

Z

^tlled
ownership.
Even
bondsman who signed away

usually wound

Ml-

almost

ago

private

farm

invest-

.

p'a,

stocks,

dom.

years

new

t

each

freedoms

tial part of their concept of free-

eral

time

same

by

founded

right

our

and

Private

Three

and

billion, and our

individual and noncorporate debt

boss, to run his own business.
ownership was an essen-

own

billion

P11*1^1, t0,

from $57.7 billion to $121.4 billion.

"Just

was

bil-

corporate debt from $80

our

searching for free-

were

hil

ioint

t

Generous and Prosperous to
This

rose

4:984. 9

tn

hiliion to $284.2

.

follows:

men

hillirm

emer-

pfi j«"Jnst. joint
ent.it.led
and

^
statement
+

World War I, our total public and
private debt was a mere $94 bil"on.) In the past 20 years, our

,

it "preempted from busi-

powers

(Back in 1917, prior to

a

ffovernment
government

ness

to

are

in 1951.

relinquishment lr0m
of
some
of
the
llQn,'
ot
some
oi
tne

They also urge
hv
oy

to the need

favorable legislative and tax

a

climate
cial

is'called

spur industrial development. Let
us-re-examine -our-capital gain

cation. We must have a tax sys- Credit

'

individuals

and

M^rri.i

up

reaucracies and
tax burden upon
Charles

set

Holdings

ades.

Some

needed
But

the

of

and

those

enterprise

many

new

these

highly

which

should

laws and

were

much

constructive,

discourage
now

be

equity

1

y

capital

and

debt-cannot

reduce

our

help

but

1

du^n^

^a^e^/0H

whtoh

TTnifpH

monetw

union,

wmcn

may

De

Howard Millet With
H. C.

Wainwright & Co.

(Special to The Financial Chronicle)

AUGUSTA,

^uuuui^

Maine

1UQ1ilc

—

Howard

uunoiu

Millet has become associated with

holds the

Teservesof

i aymenxs

he

H* C- Wainwright & Co. Mr. Millet was f~lyP ^ °fficer °£

central monetary ieseiveh ui i
wraham, Millet & Company.
strengthen capitalism—a capital- sterling area, the purchases during
ism in which freedom and social April-June 1952, originated main-

Fabian Co. Adds

responsibility
"We

must

go

the proposition

free

social

dis-

rable

that

dedicated

to

countries

of

the

$268

Details by
million

of

(Special to The Financial Chronicle)

BEVERLY

that freedom and

United States net gold sales in the

Athol

insepa-

final quarter of 1952 have not ypt

with

responsibility
and

ly in Latin America.

hand in hand.

remain

are

neither

may

be

been

published; however, on the

S.

Fabian

Calif.—

HILLS,

Lloyd is
&

now

connected

Company,

Santa Monica Boulevard.

9500

B4

(my, 1

The Commercial and Financial

Continued

from first page

Funds Accelerate

INCOME SERIES

Power

were

Power.

view.

Some

which represented .a com- completely eliminating this issue
plete turn about from the over- from their portfolios. Pure Oil
all appraisal of the third quarter continued out of favor, as during
of
1952
when
it was
the least the preceding quarter, three man-

A MUTUAL INVESTMENT FUND

RESEARCH CORPORATION
New York 5, N, Y.

•

added

the

shares.

A

shares

filotlished 1930

Broadway

stock

vious

of

one

of

inal

the

adding

the
currently

total

a

purchases.

but

much

folios

rights.
also

the

having

by

made

after

some

tem¬

issue

this

portfolios

currently;
the

of

light.

ments

added

favorite

in

preceding
number

Five

Oil,
the

same

bought
purchases of

Offsetting

sale

was

of

single

a

block of 600 shares but there

was

liquidation in three portfolios
Skellv

of

Also well liked durin* the

quarter

under

review

Shell

were

and Sinclair.

Address.

Of

c»y

particular

transactions
of

the

in

interest

Amerada

funds'

commitments

this

chases consisted

National

of

because

heavy

issue.

Pur-

shares

400

by

Investors, 3,000 by Mas-

sachusetts

Investors Trust

and

20

hv Rnwiinfj Prppn Rnnd
A sinfdp
by
Bowling Green Fund. A
single

sale

of

400

shares

Axe-Houghton

was

"A".

was

a„

made

by

least

The

Atlantic Refining,

disposing

INC.

of

18,000

Investors

Corp

-

International

Securities

-J
four

trusts

shares,

two

stocks in this group for some time,
was liked
by seven funds which

bought 18,000 shares; offsetting,
however, were five sales totaling
3,000 shares. Ranking third among
the carriers during the quarter
under
review, a total of 8,500
of

Great

Northern

folios and

22.1

1.4

others.

31.5

9.0

3.0

amounted to only 600 shares. Four

41.3

14.5

added

was

four

to

couple

of

small

15.2

managements each liked Atlantic

10.0

11.8

Coast

27.5

14.2

12.5

46.6

22.7

4.1

Nashville.

38.2

21.0

7.9

funds

Northern Pacific and 55,200 shares
of Western Pacific.
Three trusts

5.7
2.4

National Investors

21.9

3.9

3.1

State Street Investment

26.0

1.0

22.0

Line, Chesapeake and Ohio,

Illinois Central and Louisville and

.

The

added

number

same

purchased

34,000

51,500

Southern.

S.

International

and

Paeific

Gas

the

shares

Purchases

115

Broadway

"

Northern Pacific

were

Pacific Gas and Electric

was

the

outstanding favorite among the
public utility stocks as it had been
during the two previous quarters
of the year- Four managements
made initial commitments, while
four. others added to existing
holdings for a total of 42,600
shares; there were no sales. American TelePhone and General Public Utilities were next in popu-

but

there

several

ter

additions of the former

were

the

was

issue.

managements,
in

lightening

portfolios

of

Columbus

the

and

iat-

South-

Ohio Electric continued in favor, although commitments were
not as heavy as during the third
quarter of the year. Four managements purchased a total of 7,ern

200

shares.

Consolidated

Edison

also each acquired

were

by four investment companies.

*

+

oc

Niagara

six

Mohawk

part

added

was

during the

representing

by

pe-

conyer-

uidated

13,200

shares

Middle

of

South.

However, there were four
offsetting purchases of the latter

stock, while liquida- jn reduced volume. American Gas
of "A" ^t°ckihwhile,i-q"ida:
in reduced volume. American Gas

4 on appeared

in

three

Idaho

others.

Southern

11,000

shares

the holdings of
Power

Company

were

and

each

New York 6, N.Y.

FROM

EATON

Chicago 3, Illinois

■

Send
-

i

and Eiectric and North American

each lightened in four portfolios, sales of the former totaling

were

27,000 by State Street Investment
Corporation. Concentrated selling
in

Canadian Pacific, as
preceding quarter, a
total of 19,000 shares being light¬
ened in two portfolios and com¬
pletely
eliminated
from
three
appeared

during

the

others.
The

Chemicals

Monsanto, sold on balance dur¬
ing the third quarter of 1952, was
the current favorite in the chem¬

ical

division

shares
and

as

of 9,500
portfolios

introduced

newly

others.

total

a

added to six

was

DuPont

was

into

also

a

purchase, 6,500 shares represent¬
ing
five
additions
to
existing
holdings and two initial commit¬
Ranking third in popular¬
ity during the period, Union Car¬
bide was purchased by five man¬

ments.

for

agements
shares.
Air

total

a

Three funds

Reduction

of

each

(which

/

1

i

,

DEALER

.?<•

trusts

sold

shares

the most heavily

of

OM

Bond Fund

& HOWARD

OF

Montgomery StrMi

*

BOSTON

ADDRESS

BOSTON

Massachusetts Investors Trust

SAN FRANCISCO

CITY.

Massachusetts Investors

.

7:
Fundamental Investors,

Ini

-

V-

{.

.

>

H

'

1

*

\

Fund?

•*>
>

■*

*

,

'

1

•

V%«,'•-

\„

--?+

4

-*«•
'

(/■

"

v-k

n

'»

V„-¥

f#

»

v. ..*•

Manhattan Bond Fund, Inc.

<

7

>/" h/

A prospectus
relating to the shares of any of these separate
investment funds
may be obtained from authorized dealers or
SES

AVAILABLE

ON

THESE

MUTUAL

FUNDS

INVESTMENT, DEALER, OR

VANCE, SANDERS & COMPANY
111

Write

V

; v.:
NEW

KNICKERBOCKER

SHARES, INC.

Exchange Piece, New

York 5, N. Y.




I rust

Canada General Fuisid
"

*CTl

v; -

'-''i

-

'

today for your
Free Prospectus!

-

'-t-

'

i

'

'

I
a/un

'(.

:: 4

j

1

;

■

Diversified Investment Fund

v

*

20

.'•
/

■V

iXTitury ohares
S«!M|

-

*

/.

'

*

Diversified Growth Stock Fund

about

Knickerbocker

-

.7
1

i
•

„

Diversified Common' Stock Tund:
^

Growth Stock Fund

»

^ ^

r

7,100
bought

had

INCORPORATE*

24 Federal StreaE

•

•i

INVESTMENT

two

leading

been

purchased in the
group during the third quarter of
American Power and Light, Idaho the year), Allied Chemical, InterThree

BOSTON

Prospectus describing
Company and its Shares

me a

the

YOUR

by

Massachusetts Investors Trust and

u

managements

riod,

commitments),

Power and Light and West Penn

r?sult of bond conversions. 29,274
Central and Southwest Corporashare^ ?f ^PU ,wer.e ne^ly, ?c: tion and Middle South Utilities
^mrld by £rfe
?
+£
bore the brunt of concentrated
?to selling Seven trusts disposed of
f ?
|q
'f a total of 43>900 shares of the
®bares* A *°lal °f 69>660 sbarfs °f former utility and six funds liqu

10,000 by the
Corporation (both new

of New York, Texas Utilities, Utah

^be Electric

some

five

by

PROSPECTUSES OF THESE TWO INVESTMENT FUNDS MAT
OBTAINED

of

represented

American Investors,
Lehman

purchased

STOCK FUND

135 S. La Salle St.

of

„

Securities.

Favorite

EATON & HOWARD

ME

of

shares of

by 3,500 shares bought by General
'Excluding U.

BALANCED FUND

>

sales

34.3

3.4

EATON & HOWARD

Inc.

port¬

initially placed in two

A

HUDSON FUND DISTRIBUTORS
Principal Underwriter

pre¬

54.7

700.

or

favorite

eight man¬
agements adding a total of 58,200
shares. There was a complete ab¬
sence of selling in this rail. Atch¬
ison, one of the most popular

shares

None

Corp.—

the

was

group,

ferred

4,550 shares and of the latter, 80,-

be obtained from

Plate

carrier

Governments

25.4

Company
may

the

in the

Net Casjh and

23.7

_

Open-End Investment

authorized dealer

Buying of, the Rails
Nickel

Pennsylvania,

Incorporated Investors

Massachusetts Investors Trust

popular issue during the quarter

',Z

&

S.

of

and

Electric

Amerada

Natural Gas

Foreign Securities

were

generally

in

Corporation

U.

the

companies

former

50%

port-

com¬

during the

group

approximates

three

Open-End Companies—

manage¬

quarter, and
of

Skelly.
the

was

Ohio

this

Lehman

combined

sales

in

Percent Assets

Securities—

American

*U. S. and

their

from

volume

paratively

Canadian Fund,

was

trusts

experienced

eliminate

obligation please tend

of

Petroleum

seven

European

International

National Shares

However, while seven funds
purchases, three others did

year.

your

on

oil and gas investments:

are

Companies—

American
American
General

was

unpopularity earlier in the

porary

Prospectus

issues

Oils and

manage¬

increase

which

*

Closed-End

37,500

distribution

Phillips

liked

companies

pre¬

Socony Vacuum,

by

not all

course

eight

of

Sixteen
this

of

stimulated

An

petroleum

leum.

leading

popular issue,

ments purchased

prospectus on

sold

Electric*

Wisconsin

and

man¬

balance.

dividually,

shares, half of which made orig¬

■M a

tual

Virginia

Power,

those of Axe-

Houghton "A", Fidelity Fund, and,
to a lesser extent, Johnston Mu-

Humble and International Petro-

4,000

during

was

most

funds

block

balance

period,

second

no

as

port-

sold. Standard of Cali-

also

on

their

to

single

was

fornia,
sales

MNTLEMEN: At

representative

such

lightening
portfolios.
The following list represents the
Mission Development was also sold heaviest concentration in the oil
folios, while two others made new by three companies, while two and natural gas industry as a
commitments
totaling 34,600 funds each disposed of shaies of group, as well as in Amerada in-

your dealer or

NATIONAL SECURITIES &

120

even

agements

popular issue. Nine managements

Prospectus from

•

agements

group,

Thursday, February 12,1853

funds

lightening hold¬
ings during the quarter under re¬

Baying of Oils

•.

heavily interested in the oils and
gas equities and certain

natural

NATIONAL

Chronicle.

6j

•

DEVONSHIRE STREET
-

•

BOSTON

YORK

Broadway

"CHICAGO
12c

'

.

:

South LaSallc Street

LOSANQEr.ES

■

210

West Seventh Street

Volume 177

Number 5194

.

.

The Commercial and
Financial Chronicle

.

./«

national

Minerals

arid

Kite group6,ilv.e
Ifvemanlee"
al™ost »aralleled this popmanage- 1°tCf
ularity, four portfolio additions

Sulphur. Mathiereceived by Squibb hold¬
of course, as a result
of the
merger. The major portion
of
son

was

as

bore the

brunt

of

the

selling

in

little
this

group,
a

States

building

chases

of

which,

stocks,

pointed out, doubled
the

has

as

preceding quarter.

7,100

shares

portfolios

A

initially

mitted to three others.
amounted

to

5,100

ion
i°n

of

the

two

eliminated
from
Five managements

reduced

pur¬

Timber.

Chrysler
ter's

com¬

shares.

no

three

Selling

were

on

which only mild interest
displayed during the

.

been

immediately
found

preceding

quarter,

five

purchasers for 14,800
Opin- shares. A pair of sales totaled
Opto6,Studebaker, 000 shares. Sylvania was added

was

was

the current
quar¬

shares; there

offsetting

sales.'

a

were

General

concentrated

on

particular issue.

and General Elec¬

shared

honors as
issues in the

equipment

group,

the

finding

favor with eight
managements.
total of 13,500 shares of

A

Westing-

house

and

21,800

added

were

to

shares

of sales

of

portfolios.

GE

Prospectus

amounted to 3,000 shares

Montgomery

most

electrical

each

Ward Features Merchandisers

Allied Stores still held its po¬
sition as top favorite in the mer¬

chandising group, six funds buy¬
ing a total of 13,000 shares. A pair

The Electrical
Equipments

popular

favorite in the motors divi¬

total of 12,500

Yale

shares

_

had

by five, and Electric Auto-Lite
by

tric

Division

sion, eight managers
purchasing

Two sales

was

Westinghouse
Motors

four

divided

was

four.

been

to

7,200

sold out of four
portfolios.
four portfcdtoi

Johns-Manville and two
holdings of Weyerhaeuser

the

total of

added

was

and

and

others.

that of

over

shares.

totaling

JS St makrk!tPBend6x
the

being lightened in

three

also sold

Gypsum led

of

several

portfolios

Stocks

United

purchases

—

,U. S. Gypsum Leads
Building '

parade

new

to three portfolios and
initially
introduced into another.
Three
major was
favorite
cement concerns
among the sup¬ trusts each bought McGraw Elec¬
Lehigh Port¬ pliers, stock
finding its way into tric, Square "D" and Sunbeam.
land, Lone Star and Penn-Dixie.
seven portfolios. Also
liked were
Selling was concentrated on
Selling was scattered and very
Libbey-Owens-Ford
by six funds, light.
American Radiator, a total of
30,- Borg Warner and
300 shares
Doehler-Jarvis
of

eacn*

con¬

..our
managements eliminating
total of 27,800 shares.

°

Pittshnrprh

through the exercise of the
recent
issuance of rights. Eastman
Kodak
centrated

two

39,800

purchased

dorp.,' in

mdndgc*

^tional &msunfdnraCpi')0U^h^
S?iTa_LGiPsum'_Ptls
Elevator,

holdings in

Dow repre¬
the 21/£%1 stock
distribu¬
well as shares

sented

AiVc

and

ad¬

tion

6*

#

ers,

ditions to

m

(697>

*

V

Chemical

and Texas Gulf

chased

on

Ward

was

dealer,

at

pur¬

management

balance,
although the character of the sell¬
ing was important. Three sales
represented

holdings

years' standing and

Radio

from

request

upon

investment

your

of

SELECTED
Investments
135

one was made

Continued

on

Company

several

page

South

La Salle Street

Chicago 3

27

Balance Between Gash and
Investments of 60 Investment
Companies
End of
Quarterly Periods
September and December, 1952

Net Cash & Gov'ts

Net Cash & Cov'ts

Thous. of Dollars

©pen-End Balanced Funds:
Business

Shares

Axe-Houghton FundJ,'A"
Axe-Houghton "B"
Boston

-Hill!!!!

Fund

III"

Commonwealth

Investment!!!!!!!!!!!

Diversified

Investment Fund—
Diversified Funds, Inc

^Dreyfus Fund

fMutual Fund
National

Nation

1,329

331

47.9

21.5

50.5

10.1

25.1

.24.1

53.4

4.6

65.8

4.8

26.7

3J647

25.8

0.4

68.7

69.4

3.9

3,313

43.1

3,578

39.2

56.5

6.1

56.9

5.9

24.3

25.1

69.6

69.0

520

712

1.8

2.1

21.1

23.8

77.1

74.1

Prospectus

26.5

7.6

8.3

55.1

65.2

your

Fund—Group Sees.

8.5

30.3

28.9

3,286

54.1

60.5

62.6

•48.6

287

9.0

345

8.8

12.4

36.9

42.6

14.7

11.1

9,850

10.9

3.1

76.5

74.4

2.3

313

33.0

273

31.1

18.1

63.9

66.6

14.0

25

19.2

37

21.0

1.2

62.7

65.0

1.7

624

38.5

958

38.1

2.4

60.3

60.2

3.3

16.9

16.4

80.7

80.3

12,339

ZIIIIIIZZIZ

Securities—Income

Clark..."!""

Whitehall Fund

•2,813

3,274

14.6

16.3

4,858

29.3

4.474

25.4

8.4

56.1

58.3

7.2

21.7

23.1

5,236

14.1

69.9

69.7

13.2

489

4.9

5,499
388

...

27,216

ZZ_!ZZZZZII"~
Colli!!!!!!!!!!!

Wisconsin Investment

•

20,471

<

32.5

Fund

23.4

23.4

Bowling Green Fund

HI!

Bullock Fund
Delaware Fund

I!!!!!!!!
Hill!!!"
ZZZZZZZZZI

Dividend Shares
Eaton & Howard Stock
Fidelity Fund

f

"ZZZZZZZZ

Fundamental Investors
General Capita!
Corp
l-llllllll!
Group Securities—Common Stock Fund
Incorporated Investors
Institutional Shs.—Stock & Bond
Group
Investment Co. of America..
Investors

Management
Knickerbocker Fund

Loomis-Sayles

,

'Republic

-

Investors

Selected American

8.3

27.1

27.1

65

60.9

1.5

64.6

2.4

47.1

45.2

51.4

17.0

52.4

17.5

7.0

7.6

76.0

1.3

140

127

18.2

1,235
1,127
2,040

937

5.9

•
•

Fd!

ZI
III!
..III!

^

-

>

.1

I

Corp

■

0.1

97.0

16.2

98.6

26.7

19.5

55.1

64.3

4.2

None

None

4.0

3.3

5.3

4.9 *

14.4

10.8

0.9

0.1

»

Capital
General
General

■

American

*

V

-

"

'

%

•

•,

V

«.

,

Name

ADDRESS.

84.7.

91.8

3.0

2.3

3.0

3.1

94.0

13.4

94.6

11.4

0.2

None

86.4

88.6

,

881

766

6.5

4.5

2.0

2,887
2,789
2,727

1.0

3,800
3,121
2,843

3.8

4.5

3.7,

1.2

2.0

2.1

None

None

98.0

20.3

97.9

19.8

,358

None

None

375

79.7

8.2

80.2

7.6

None.

None

91.8

92.4

None

None

93.0

94.3

1.9

9.5

14.3

72.8

83.8

Every month Modem Security Sate*
brings result-getting suggestions fin!

16.7

None

0.5

288

82.5

82.8

the

2.0

2.0

None

None

7,073

70.9

98.0

98.0

42.6

You

3.9

3.4

8.344

25.2

29.6

54.0

28.3

20.4

22.0

50.0

49.7'

None

97.4

97.6

2.4

None
NA

NA

'

298

15.5

11.8

32.3

972

33.6

2.4

3.1

None

None

3,025
1,436

2.9

5.4

24.3

22.5

None
_

w..

8.8

nr,5.5

10.9

4.7

27.6

23.0

1,838

»9.7

6.9

None

None

1.1

0.8

5.6

4.8

25,628

23.1

22.0

0.5

782

21.3

20.9

None

NA

t

■*

None
.

290

5

3,827
997'

Investors

:

.

J

I

■

(

97.6

1

66.9

72.0

61.5

_1

.I!!!'!!
I
HH

lists,

90.3

*

-

o,5

America's

None

78.7"

units,

ter

which

MSS

79.1

5.7

0.5

0.5

92.4

7.4

93.8

1.4

13.7

12.5

78.9

86.1

1,458

737

5.9

3.0

399

0.8

0.7

204

3.8

1.8

8,680

14.6

16.6

8,043

16.0

15.2

93.3

96.3

81.6

81.6

and

to

fall

Each issue pro*

sales

is

on

trainer.

worth

pay

ads,

prospecting.

Mutual

Yatt
ammu¬

for

No mat¬

Fundti .you

in

month

one

whole year.'

a

annual subscribers

7.1

183

cam¬

complete sales riieetiHg,

a

fresh ideas

77.5

3,097

shares.

where

schedule,

ace

nition for

94.4

'

76.4

Funds

get mats of 4 newspaper

93.1.

93.3

the

the

1
.

renew.

^feaf

98% of
.

ORDER

•

1,228

None

326

None

84.0

9.2

84.8

2.5

None

None

18,083

12.0

90.8

97.5

11.8

None

None

1,604

-88.0

14.2

88.2

12.5

3,518
2,978

6.7

5.8

1,243
2,543

79.1

2.2

81.7

0.7

14.1

14.5

4.8

83.7

84.8

4.1

5,551

None

None

5,157

8.5

95.2

7.9

95.9

0.1

0.1

International Secur...

all

—

production details.

.72.3 '

...

Mutual

^vides sales training by Jack Lacy,

96.9
94.6

of

complete direct mail

get

get

54.6

97.1

sale

paigns

NA

52.2

17,442
1,861

Public Service.

„

5.7

NA

7

..

17.0

680

1

help you

can

3,732

2.6

2,361

MSS

7.0

NA

:

Mutual Funds you sell

17.7

325

6.46

94.5
94.3

42

NA

1,404

91.5
92.5

7,807

12,377

1,431

.

No matter which

89.1

350

749

Securities....1.11
!_.!
Administration
Hill

^National Shares Corp
Tri-Continental Corp.
fU. S. & Foreign Securities
U. S.

-

.

"you

Lehman Corporation

._•

Prospectus describing
Company and its Share.'-

me a

'he

95.8

90.7

13,624

25,686

International

*

94.1

1,017

1,645

422

NA

Adams Express
American European
American

Broadway

NewYork6,N.Y.

74.9

0.1

Closed-End Companies:

,

.

14,821

11^572
>
8,1.48 V
12,215::

Hill..
—IIII!
Shares.—-I!!!!!!.! /

St. Investment

2.9

275

-

—-v_-—

3,101

3,382

Wall St. Investing Corp..^!.,-Z

.

;

Send

»

71.0

900

384 *

'

Sovereign Investors
State

71.7

39

8,725

Fundi"!!!!!!!

Mutual

' Mutual Investment Fund
^National Investors
^National Securities—Stock
t New England Fund

■

1

.III
I

Fund

Mass., Investors Trust
Mass. Investors Growth
Stk.
;

'

115

Chicago 3, III.

55.0

837

6,391

Blue Ridge Mutual
Fund
Broad Street
Investing

i

MANAGEMENT CO.
135S. LaSalleSt.

CITY

Affiliated

1

(

53.4

,

5.6

12.0

31.8

on request from
investment dealer or

TELEVISION SHARES

'

©pen-End Stock Funds: '

,

..

9.2

Shareholders Trust of Boston...

;

—

Dec.

28.3

Wide

Wellington Fund

-End of

29.2

37.3

Fund

&

22.9

Sept.

21.2

of Boston

Scudder, Stevens

Per Cent

Dec.

353

Securities
George Putnam Fund...
i

2,995

1,182

8,220

Sept.

8,030

General Investors Trust.
Mutual

8,772
5,720

Dec.

453

^Investors Mutual
Johnston

Grade Bonds & Pfds. '

End of

Sept.

8,161
3,594

Balanced....!!!

Fully Administered

Dec.

_!!!!

.

Eaton & Howard

Com. Stks. Plus Lower

Per Cent •

End of

Sept.

American

Invest. Bonds &
Preferred Stocks

Per Cent

-End of

91.4

92.0

!

CURRENT

PORTFOLIO NOW

•

Fund

Services

•

1015S

•

Washington

of

Washington, Inc.

Woodward

5,

Bldg.

D.

C.

<

Investment
Ba

for

lents
or

bonds

associated

and

preferred

stocks:

Moody's Aaa through
BB and approximate
equiva¬
1 Portfolio exclusive of
securities in subsidiary
companies.
{ Name changed
from

bonds; Fitch
preferreds.:

for

SUMMARY

s

AAA

through

Nesbett

NaTnotCavailabIer°m Russe11 Ber* Fund- ^September




Fund ^

figures revised.

J Enter

Change in Cash Position of 60 Investment
Companies
(Period—Fourth Quarter —
1952)
•
Open-End Companies:
Plus
Minus

Closed-End Companies

Unchanged

10

10

1

•

21

15

7

28

0

10

1

11

S
»

35

9

MSS

•;
Name

:

;

i

Firm

•

6

16

to

»

Total

60

Address

___1L

1—

.

-J
!

•

Totals—All Companies...

subscription

J □ Monthly at $12.50 □ Annually at $125
J □ Bill me later
Q Check Enclosed

*

Balanced Funds
Stock Funds

my

k

City

Zone
'

' .'

•

'

State..
.

'

9m mm mm mmm mmmmmmmmmmmmrmmmmmm

The Commercial and
2G

Financial Chronicle

.

.

.

Thursday, February

12, 1953

(693)

Slock Holdings of 44 Investment Management

Changes in Common

(Sept. 30—Dec. 31, 1952)

<j/ie

exceed sellers—or sellers exceed buyers—by two or more management groups,
making
more managements sold than bought are in italics.
Numerals in parentheses indicate number of managements
new purchases or completely eliminating the stock
from their portfolios.
Transactions in which buyers

-Sold-

—Bought—
No. of
No. of

FUND

Shares

Trusts

No. of

No. of

Shares

Trusts

Trusts

15,200

Co...

and

Deere

—13,000

Oliver Corp.

None

None

5(1)

2(1)

2(2)

10(1)

Auto

Auto Parts:

3,200

Bendix Aviation

5(3)

6,200
8,100

8(3)

12,500

Chrysler

4

13,750

Clark

7(3)

SOVEREIGN

and

Equipment i

_____

Dana

8,100
2,800

Doehler-Jarvis Corp.
Mfg.

Eaton

Auto-Lite

6(2)

3,400
39,800

Electric

INVESTORS

6(3)

15.100

INVESTMENT FUND

2(1)

3,300

Libbey-Owens-Ford Glass
Midland Steel Products

A MUTUAL

4(3)

TITLE BLDG-. PHILA. 10,

PA.

4(4)

3(2)

—

1

10,200

4(1)

6-9242

None

1(1)

8(3)

21,800

General Electric

1

3(2)

11.200

McGraw

1

5(1)

Radio

4(1)

3(1)

14,800
5,950

None

3(1)

5,000

None

■■■■laiiauiiii

naaiiiiiiv
■■■■■■

::

WELLINGTON

Airlines

Eastern

Lockheed Aircraft 2

Aviation

American

North

United Airlines

•

None

1(1)
1

2

500

investment dealer
or

3# PA.

Corp.-Seagrams

_____

2,100

None

2(1)
3(1)

2,200
9,540

Lehigh Portland Cement__j__J_
Lone Star Cement

3(1)

6,200

2(2)

4,000
20,600

National Gypsum

.i

Glass

Pittsburgh Plate

2

Ruberoid 2

2(1)

150

Sherwin Williams

3

3(1)
None

Texas

American

8,833

Continental Casualty 8a

4

3,600

3(1)

5,200
7,400

Household Finance Corp

5,500

Simmons

2,050
7,100

Trane

6,800
1,000
4,400

Yale and

Co.

——-

Co.

United

Gypsum-..,--

States

Towne

American Radiator

Johns-Manville

Weyerhaeuser Timber

None

2(1)
6(1)

4(1)
4(1)

KD

None
None

15

7(2)
2(1)

2(1)

3(1)
4(3)

be obtained jrom
investment dealer or

prospectus may

8(2)

2(1)
2(1)
•3(1)
5(2)
BRADSCHAMP

&

COMPANY

Solvents

Chemical 4

3,900

2

2,000

2

15,233

1

1,000

2(1)

2(2)

4

6,049

5(3)

2(1)

9,157

5(3)

4(2)

3,200

2

3

9,780

Metals and

None

Min.

Internat'l

2

None

None

2(1)

None

None

2(1)

1

2

200

None

10

9,114

None

and

Haas 6

1,035

Rohm

1,900
7,400
3,000
7,100

Spencer Chemical
Tennessee Corp. __1
Gulf

._

.

11(1)

None1

7(1)

25 500

2(1)

2

*

26,176

vl

._^_

None

1(1)

500

4(4)

*

1

3,400

Owens-Illinois Glass

.

2(1)
1(1)

3,500
400

None

-

None

.

None

None

7,200

•

3(1)

3(3)

None
None
1
;
•

1

1(1)

None
None
None

3

None
None

None

3(3)

Smelt.

&

4,900

None
None
None

1(1)
3

None

None

None

None

None

None

None

None

1,850

2(1)

None

None

300

1(1)

14,300

4(1)

None

6,500

None
2

Addressograph-Multigraph i2 __
Inter. Business Machines 13__—

-

Paper and

3(3)

1,300
34,200
4,860

2

2,600

8

21,499

.

None

1

None

None

None

Printing:
Champion Paper & Fibre-

12,700
4,300

3

7(1)

1,200
None

None

Container Corp.

1. Crown

Zellerbach
Corp. 14

The. Mead

Paper

Scott

-

Power

Abitibi

None
4

None

None

None

None

15__.

1,600

and Paper.

11,300

Bag and Paper

Union

.

L

1

None

53,300

International Paper
*

3,000

2(1)
2

Petroleum:

FUNDS

3,420

7(1)

MeSfo/J

MUTUAL

VtWJfo/J

STOCK FUND

WVt&fozJ

SELECTIVE FUND
COMPANY

☆

5

84,950

8(4)

37,500

None

None

None

None

None

None

None1

None

companies available at offices
principal cities of the United States or from

the national distributor

and investment manager.

DIVERSIFIED SERVICES, INC.
Established in 18 94

MINNEAPOLIS 2, MINN.

1,000

1

3(3)
None

"A" i8_.

None

None

Skelly Oil'
Socony* Vacuum Oil19
Standard Oil of California.

14,262

-

Company

Humble Oil and Refining..
Mission
Pure

Petroleum

Development

5,200

4,000

_____

Refining

International

None

None

Oil of Ohio

Atlantic

*•

None

None

Texas

$

None

None

Oil

Standard

34,600

6(3)

1,000
1--.

Signal Oil and Gas
-

1

3,368

None

Shell

3,500

2

_

Oil

Richfield

20,600

16(4)

Prospectuses of these
in l ift

13,200

3,855
6,170

6

Oil 1°

Jdancock Oil17
Phillips Petroleum

2.500

3

4(1)

*r

-Gulf

28,928

400

Amerada

_

8.240

3

SYNDICATE OF AMERICA




None

19,222

9

2

PROSPECTUS ON REQUEST

State

None
None

None
None
440

Consolidated Natural Gas
Lone Star Gas
Oklahoma Natural Gas
'Panhandle Eastern Pipeline20-" Peoples Gas Light and Coke 21__
.'Shamrock Oil and Gas22
"United Gas Corp.22*.
Western Natural Gas
itexas Gas Transmission

4,447

5

None

None

27,800

American Can
Continental Can
Corning Glass Works.
Crown Cork and Seal.

<

City

None

Office Equipment:

11(2)

1

None

None

Corp.

" Chicago

None
'

_____

None

None

None

None

Sulphur

FACE-AMOUNT CERTIFICATE

:

None
None

'

None

^

Kodak

Eastman

None

FOR

Address

None

2,400

Reynolds Metals
Consolidated Mining

600
9,600

15,255
33,110

AND

Name

■

American Metal Co.11
"Magma Copper
New' Jersey Zinc

10,700

20(1)

without

None

Mining:

8

—

Union Carbide

UNDERWRITER

Prospectus

None
None

11,500

Dresser Industries

None.

-

1,500

Chemical

Monsanto

PRINCIPAL

me

2

Industrial Equipment:

Chicago Pneumatic Tool
rWorthington Corp.10

None

4,000

Chemical2

Mathieson

Texas

None

None

I& Chem. Corp.

Powder

Hercules

KANSAS CITY 6, NIO.

obligation.

Dairy Products

Allis Chalmers
Bucyrus Erie

None

None

None

MUTUAL INVESTMENT

DISTRIBUTOR

Products

National

>

20,200

3

1016 BALTIMORE AVE.

California Packing

Machinery and

900

Incorporated

send

11,300

General Foods

.5,100
.5,100

.

Freeport Sulphur

2

3(1)

Please

17,700

3

None
None
600
500
3,000

Foods

Corn

None

125

du Pont

22,400
9,000
6,500
1,200

7(2)

2

15,900

of Manhattan

Best

None

Containers and Glass:

5(2)

Guaranty——

S. Fidelity &

7,500
10,100.

3

Bank Bidg., Houston, Texai

INVESTORS FUND

Dow

140

2(1)

Chemical and Dye_^____

Commercial

68,300
9,500

3

Reduction

Allied

8,100
10,100
18,223
6,500
4,000
1,100
5,600

2

None

Natural Gas:
Air

9,400

3

None

Products:

38,400

8(2)

Chemicals:
3

Corp

Bank

30,300 '
30,300
9,200
9,200
3,100
3,100

_

Midland

Marine

None

None

None

None
None
None
None
None
None*
None

"First Bank

10,500

None

None

1

2

None

Employers' Group Associates—
Stock Corp
-General Reinsurance9

4.500

2

3(2)

1

2(2)

None
None

.____

U.

None
None
None
None
None

—

Reinsurance

2,600

3

3,500

2,300

4(4)

Financial, Banking and Insurance:

2(1)

2(2)

None

2(2)

2,100

E'lectric

2(1)

None

Nbne

1,600

Sylvania Electric

3,200

None

>

1(1)

None

—

2(2)

None

2

—None
——
None

_1

Corp.

1

400

855

Electric 8
"D" i_

Security-First Nat. Bank of L. A.
Traders Finance "A"

None

Penn-Dixie Cement

America

1,100

None

None

500
1,200
6,000

■

None
None

Otis Elevator

Square

13,500

2

2(1)

—

2

None

None

None
23,200
8,700

—

None

and Equipment:

None

1

-

Distillers

Flintkote

5(1)

National

National Distillers

4,000

7(3)

Union

—

2

2(1)

your

Cola

Coca

None
300
3,000
20,100

Sprague

Westinghouse

Food

3(3)

prospectus from

PHILADELPHIA

1(1)

Ginger Ale

Canada Dry

Corp. of

5,800
10,200

2(1)

None

None

20,000

Electric.

Sunbeam

2

Building Construction

^nffiND

your

3(1)
4(1)

2,500
1,200
3,300

2

3(1)

2(2)

2,000
None
1,000
700
None
3,500.1

Airlines

American

Boeing Airplane

Beverages:
»!»»■■>■■■■■■!■■

Trusts

Electrical Equipment:

8(2)

13,000

2

None

4(1)

10,300
3,130

4
3

General Distributor
RIttenhouse

—

General Motors

11,500
8,600

4

fir CO.

BAILEY

None

Aviation:

Prospectus upon request

A.

2
1

None
800
700
900
7,200
None
None

Corp.

2,500

5(1)

5(1)

2

1,000
20,200
1,800

Borg Warner

2(1)
3(1)

No. of

Shares

None
None
None
17,000

13,168.75 Colgate-Palmolive-Peet7
13,200
McKesson and Robbins
19,800
Merck and'Co.
:
8,600
Parke Davis and Co.
4,500
Sterling Drug
None
Bristol-Myers
None
Squibb3

6(2)

Boston

Sold—

NO. Of

American Hospital Supply

2,500

6(1)

Putnam Fund Distributors. Inc.
50 Sute Street,

Shares

entirely

Drug Products:

10,000

2

—Bought—
No. of

No. of

Agricultural Equipment:

&06 ten

S45 LAND

which

Issues

Scorye

PUTNAM

CEORCE

Groups

Co...

Oil

3(2)
None

3(2)
None
1

18,000

'4(2)

9,100

3,800

2(1)
■2(1)
3(2)

800

3(2)

8.000

Public Utilities:

3(1)

8,200
3,900

3

5,360

4(1)

7,200
6,600

9(3)

3(1)

4(2)
2

12,000
23,320

American Tel. a"d Tel. 23
Central Illinois Pub. Service__.
Cleveland Electric Ilium.24—..
Columbus & South. Ohio Elec..
f Commonwealth Edison
sGonsolidated Edison of N. Y—
Duquesne Light23a

None

None

None

None

None

None

None

None

3.500

1(1)

None

None

None

None

Volume 177

Number 5194

.

.

The Commercial and, Financial
Chronicle

.

27

(699)

—Bought—

-Sold-

No. of

No. of

Trusts

Shares

2(2)
7(3)

33,313
29,274

2(1)

400

5(3)

35,400

3(1)

5.500

Indianapolis

International
Interstate Power Corp

2

6,500

2(1)

6,600

2(1)

7,325
30,015
8,600

4

3(1)
3

Florida

Idaho

Public

Power

Kansas
_

40,600

6(3)

Power Corp.__:_-I

General

.

Utilities.-.

General Telephone Corp...
Co

Power and Light-.
Tel. and Tel

Gas and

Electric

Long Island Lighting 25
Minnesota Power and Light.

69,660
14,900

4(4)

33,480

Oklahoma

8(4)

42,600

Pacific

2(2)

22,600
2,800
23,700

Potomac

Power....-^
Southern California Edison
Texas Utilities

28,570

Union

4(4)

9(9)
4(1)
7(2)

5,400

4(2)
2(2)

3,575
28,940

2(1)

•600

None

None

1

8,200

h

None

*

6,650
13,900

4(1)
1
1

1,050

1

200

None

2,733

4

and

and

Electric

—

Electric

Electric

(Mo.) 26____

None

None

None

by

None

vestors

None

ago

None

None

None

None

1(1)
1

None

3(1)
1

None

was

None

managements

1

Grant,

None

None

5,080

3(1)

None

None

None

4dy
3(2)
7(3)

3(1)
2

3(1)

4(1)

51,000

Loew's,

25,600

Paramount

Inc.
Pictures

Theatres, Inc..

None

None

None

None

5,500

6(2)
4(1)
4

8(1)
2

4(2)

4(3)
3(1)
4

None

and

N.

J 600

Nashville

Norfolk and Western..
Northern Pacific

Pennsylvania

Railway

Railroad Equipment:

General American

2(1)
2(2)

None

None

None

None

2(1)
3(1)
4(2)
2

2(2)

2(1)
2(1)
3

"

Allied
First

"2

2,800

...

5

14(2)
5(4)

National

Grant

(W. T.)

Hecht

Co.

Stores.

Co

Auto

2

None

None

-i"

Supply

No. of

No. of

Shares

7(3)
5(3)
3(1)
6(6)

Firestone

Goodyear 28

8(2)

States

-

Allegheny Ludlum

-

—

Steel 29__.

Bethlehem Steel

Republic Steel
United

States

-

-

...

4,000

Vanadium

3

6,400

Wheeling Steel

None

None

None

None
None

1

Reynolds

1

Newport News Shipbuilding

None

None

of

Total

9

11

-

8

3,400 shares

8a

Additions for

9

shares

dividend
received

of

92

shares,

shares

represent 5%
received as 50%

3,230 shares

most

part

for

additions
stock

10%

as

in conversion

5%

stock dividend

amounts

14

2%

stock

equals

stock

15

Part

2

3(1)
1

as

of

result

a

merger.

received

as

4%

stock

dividend.

dividend.

dividend

equals

dividend

2,190

purchased

23

Part

25a

United

1

Gas

for

each

10

from

6.

by

NOTE
sales

of

—

This

funds

6,750

4(2)

example,

4,000

5(2)

having

8,300

3(1)

Loomis-Sayles

the

the

survey

and

Bond

and

Share.

Share.

sponsored

funds

several

weight

by

of

Mutual

one

Fund

the

61

investment

same

sponsored

are

hot

for

by

Calvin

Individual

liked

by

Four managements

total of 11,500 shares of
Airlines
10,200 of

,10,300
two

were

of

Eastern.

portfolio

elim¬

are

were

manufacturing

the fa¬

issues
in

was

and

light fa¬

more

but

treated

Bullock

portfolio

issues

in the

picked

up

tire

and

rubber

considerably

Goodyear

and

as

United

States Rubber each found five

10.

companies,

management

.manager.

a

Firestone,

"A" stock.

covera

each

were

and

Interest

Electric

Bond

1

"A"

North American

Distribution

30

Finance

vor.

Except 2,500 shares represent distribution from Electric Bond
Basis: 1 Washington Power for 50 Electric Bend and Share.
10,265 shares received as 5% stock dividend.
1,100 shares represent 2% stock dividend.
5% stock dividend represented by 2,300 shares.

Basis:

C. I. T.

on

Financial and Commercial Credit.
Household
Finance and Traders

vorite

,

26

American.

Manhattan.

divided

was

Boeing and Lockheed

dividend.

27

North

of

inations of American and United,
however, and one of
Eastern.

through conversion of bonds.
Received in part dissolution of Standard Gas and Electric.
Purchased through rights. Basis: 1 for 5.
In part bought with
rights. Basis: 1 for 7.
from

total of 15,900:

a

Bank

American

received

Part converted

Opinion

There

Electric

of

United

shares.

issued

Security-First National
Angeles.
Three manage¬

acquired

stock dividend.
dividend.

to

rights

issues.

and

Los

several trusts.

3,057 shares.
1,482 shares.

through

banking

«

33Vh%
stock

purchased through rights. Basis: 1 for
as
4% stock dividend.

Basis:

28

9121/2

Part

*

25

Squibb

In part purchased
through rights. Basis: 1 for 10.
2'/2% stock dividend represented by 4,614 shares.
20% stock dividend equals 8,515 shares.
Major portion received as 10% stock dividend.

20

24

rights.

preferred stock.
stock dividend represented by 2,659 shares.

5%
3%

19

purchased through

of

13

18

part

stock, dividend.

represent

distributed

Part received

and

and

commercial
banks
liked during the period were First
Bank Stock Corp., Marine Mid¬

shares

10.

exception

12

1(1)

500
■5?

for

With

stock

two
portfolios.
by two manage¬

the

ments eliminated

50.

Chemical

6

8,377.75

2(1)

4,800

Mills

Mathieson

2l/2%

as

for

1

6

29

Celanese Corp. of America.

received

total

Buying continued scattered and
a slightly reduced
pace in the

of

7

1,000

1

at

insurance

land

shares represent 50% stock dividend.
Excluding stock received as 10% dividend.
Stock distribution of
5% equals 561 shares.
Part

21,499
a

ments.

8,750

Basis:

11

None

59

FOOTNOTES

7,500

rffc

.msstjgr

20

to

sold

was

Among

1,040 shares distributed a3 2% stock
Part represents 5% slock dividend.

1,000

added

were

27

32

totaled

34,200 shares of International
Paper.
Three other funds each

Abitibi

6

2

additions

Seven trusts added

bought Champion and Container
while Crown Zellerbach and Scott

2

0

sold

three
trusts com¬
pletely eliminating a total of 2,400
shares.
Union Bag was the top
purchase among the paper stocks
but- part of the
additions were
stimulated through rights. Eight
shares.

.

Chicago
was

balance,

None

Bought

issue in the

were
Bucyrus Erie and
Pneumatic Tool. Dresser

None

21,012 shares received

1

the outstanding

Hilton Hotels

16

6(1)

by
was

portfolio

;

9,300"
3,000

17

8,900

liked

Bristol-Myers, whose
recently reduced,

was

States Steel and Repub¬
while
Wheeling was liked
three trusts.
Allis Chalmers

lic,

None

1

2.000

two

None

4

None
.rfS*

Burlington Mills
Robbins

None

200

Tobacco

3,000

1

__

12,000
American Viscose
2.4121/2 Industrial Rayon 30
16,300
Steven (J. P.) Co

19,800
1,000

Philip Morris

5,080

15,000

_

■

3(1)

10,900

1

None

19

Textiles:

None

600

Myers.

Stock Funds

10

4(2)
4(2)

2

.'£Xv>
__

Trusts

21

5

None

1,160

.

Steel

2(2)

No. of

5

23a
_

No. of

Shares

Matched

22a

33,500

None

and

45,800

Basis:

2(1)

also

managements

machinery group, eight purchases
totaling 20,200 shares. Also liked

3

None

37.900

Goodrich

37,500

5

division of

even

Sold

4

26,000

Rubber

4(2)

7(1)

fairly

a

there

13

3

None

and

United

either

on

while

Balanced Funds

2

None

-

-'&•

---

4(2)

7(1)

Liggett

Open-End Companies:

21

28.500

also

market,

American Tobacco

8,900

2

22

6,400

was

registered

the

Miscellaneous:

1(1)

None

Dairy

Foods

completely eliminated from
portfolios with no purchases
during the quarter.

was

on

24,100

2(1)

1

Steels:

8(1)

of

Tobaccos:

None

None

Marshall Field

34,280
42,000

8,000

being

side

Sold

Trusts

3,700

37,000

Woolworth
Gimbel Brothers

29.900

3

United Gas, Panhandle East¬

were

None
None

Sears Roebuck

United

tions

among

exceptions

None

3,000

Best

funds

•-

Rubber and Tires:

-

scattered

Closed-End Companies

*^5

while

California

made

None

Murphy (G. C.) Co
Safeway Stores

1,000

2(1)

Stores

Western

metals

None

Montgomery Ward

1,300
2,300
10,000
2,800
5,400

non-ferrous

None

May Department Stores

9,700

U

well

several companies. The

Totals—All companies

13,000
3,500
4,600
19,000
19,100

Jersey Zinc was one of the
outstanding favorites in the

None

1(1)

General Foods and National

Products,

dividend

New
few

.vbw*

5(3)

issues, Corn
favorite, six

group,
four
purchasing
3,200
shares.
The Steels
Reynolds Metals was also liked by
three managements
and
Magma
Top favorite in the steels was
Natural Gas
Copper by two. Selling on bal¬
Bethlehem, a total of 28,500 shares
ance was marked
by lightening of representing six portfolio addi¬
Purchasing of Natural Gas is¬
Consolidated Mining and
Smelting tions
and
two
sues was somewhat
initial
commit¬
heavier than in
three portfolios.
Opinion was ments.
One block of 15,000 shares
during the preceding quarter, but
split on Kennecott, five transac¬ was sold. Four funds each
bought

Retail Trade:

3

Department Stores
while
Gimbel

'***•?:

1,000

the

trusts purchasing a total of 17,700
shares. Four funds each acquired

Five

Non-Ferrous Metals

SUMMARY

19,000

food

Parke Davis.

T.

Balance Purchases and Sales Portfolio
Securities
,1
59 Investment Companies

Transport..-.^ None
■

6(1)

May

W.

None

'

and

Transmission.

Three

liked

None

'

"

2

each

None

_,

5,500

slightly favored.

None

Western Pacific
Canadian Pacific

Oil

the
was

issues.

None
.

21,950

Y., Chicago and St. Louis.i^

Southern

None

None

.v.

Central

Louisville and

5(2)

None

Ohio

Great Northern Pfd

None

2

3,000

Coast Line

Chesapeake
Illinois

Shamrock

2(2)

.-few

Atchison, Topeka & Santa Fe_-2]
Atlantic

and

3(1)

Railroads:

4(3)
4(1)

Coke

Light

Gas, but the major portion of ad¬

Brothers and Marshall Field were
the unpopular stocks in
this group,
four funds each
disposing of these

,

18,000
7,000
17,300
8,500
21,200
12,000
58,200
2,500
51,500
34,000
3,400
55,200

and

manage¬

Woolworth,

fairly

6(1)
4(1)

years

Gas

—Bought—

3(1)

7(f)

also

and

None

Pipeline, Peoples

Among
Products

Phelps

Packing each found'a
Foreign ditions of the first named utility
couple of purchasers. Selling was
holding was stimulated through rights dis¬
of 7,000 shares and
■extremely
light
and
scattered.
its affiliate, tributed
by Electric Bond and United Fruit found an
United States and International
evenly di¬
Share,
while
additions
of
the vided
opinion
between
bulls
and
Securities, eliminated a block of other three
were
largely repre¬ bears.
The drug products were
12,500 shares. M.I.T. disposed of
sented by stock dividends.
Two featured
17,500 shares, but still retained
by six purchases each of
sold
Texas
Gas McKesson and Robbins and Merck.
70,000 shares in its portfolio. Sears managements

None

2

two
to

ern

policy. U. S. and
Securities sold its entire

None

200

which

In¬

ment

Radio and Amusement:

National

Trust,

None

6,565

Massachusetts

publicly objected

None

Wisconsin Public Service 23aNone
American Gas and Electric
4,550
American Power and Light-_ivy|
7,000
Central and Southwest
Corp.-iys 43,900
Iowa Power and
Light
6,400
Kansas City Power and Lights
3,300
Middle South Utilities
13,200
North American Co
80,700
Virginia Electric and
Power16,500
Wisconsin Electric Power

None

mutual,

None

4,600

None

a

None

None
..a.

opinion on Anaconda,
Dodge and Nickel.

None

5,430

Electric23a

Continued from page 25

Funds Accelerate Buying of Oils

6,500

Gas

Utah Power and
Light.
Washington Water Power 27
West Penn .Electric

2,300

None

None

None

Ohio Edison

9.540

Trusts

3,000

England Electric System.
Niagara Mohawk Power25a____

3

3

No. of

Shares

16,000
..

New

Gas

No.of

are

and

Share.

baccos

be

bought

selling

also

a

unit.

considered

changes

of

continued

with

a

total

Reynolds

Liggett
and

well

only two
registered

and

Philip

Continued

For

to

of

transactions
the four issues favored—

American,
or

or

Goodrich, how¬
The to¬

among

purchases
as

purchasers.

ever, was sold on balance.

Myers,'

Morris.
on

page

A

28

as

the

surveyed.

SSc

Aberdeen Find
Est. 1933

;

GROWTH

:

INDUSTRY

•

SHARES,

■•y*

A Mutual'Fund
Priced at 103% of net asset value.

FIDELITY
Founded

FUND,
at

Boston,

INC.

1930

A

Prospectus and Other Data Obtainable From General Distributors

inc.

Mutual

Investment
Prospectus from

your

dealer

Paul H.Davis & Go.

or

CHICAGO, ILLINOIS

■

HARLAND
28 EAST JACKSON
if

ALLEN ASSOCIATES

BOULEVARD—CHICAGO'4.




—

ILLINOIS

The

Crosby Corporalion

Fund

BOSTON, MASSACHUSETTS

Teletype CG 934, 405

Teletype BS 411

Telephone FI 6-0300

Telephone CA 7-6811

Prospectus from

your

Investment Dealer
61

or

BROADWAY,

'

'

NEW

YORK

6

The Commercial and Financial Chronicle
28

,.

*

12, 1953

Thursday, February

(700)
creased at least raises the

27

Continued from page
'

_

m

rn

BOSTON

he.

managements eliminated
Textiles found

two

but

National Theatres.

dealer or •'

Prospectus from your
Investment Manager

sold

were

on

However,

balance.

Mass.

Congress Street, Boston,

19

Mills

COMPANY

RUSSELL, BERG &

ascendant,
and Robbins
management

slightly on the

sellers

Cfelanese, Burlington

and Underwriter

pur-

seven

made of American
Viscose and J. P. Stevens
while a few shares of* Industrial

chases each were

Rayon
tion

purchased

were

those received

to

in addistock

a

as

dividend.

review

Television-

of

Directors

The

Electronics Fund, Inc. have

clared

to
port- gram and to intensify our efforts
quarter under in Korea. Barring such a developBower Roller Bear- ment, and recognizing that it is

further profound effects on our
economic life seems always to be
with us."
A

will be adopted to

rearmament

our

de¬

by Republic Investors.
Lehigh
Valley
Railroad

President

added to the portfolios of

'

was

the two

impossible to predict just when
the three major props under our
economy
(defense expenditures,
the foreign aid program and capital outlays for plant expansion
and modernization) may weaken,
there is evidence that the expenditures involved have reached
their peak and that the boom is
assuming the characteristics of
maturity. A decline in such expenditures, which may very well

closed-end funds, Tri-

Seligman

and

Continental C o r p o r a t i o n

Capital Administration (which it
is expected will soon be merged,

WANTED

2 Senior

Analysts

A large, growing,
needs

\

standing

able

t

utility

its

heading

of

Division

—

the

cap¬

Utility

other,

a

perience.
Excellent

advancement,

ency

and long term security.

Please

state

Staff

Address President, Box

C212,

The Commercial & Financial

25

Chronicle,
New York

Park

well

tal

desired.
Our
knows
of
this
ad.

Place,

7, N. Y.

as

a

Adams

International!

Where

simple single-deck capias
in the case of

structure

shareholders

at

or

c. Roney & Co., Securities
tional Bank Building.

Na-

With Merrill Lynch
(Special to The Financial

Chronicle)

Mich

RAPIDS,

GRAND

"vZJrt

^ Dol-!fc^ ;hreat to the s?und Merrill ^nH- ' TrW ^nmnanv
ot a Pnf ti/ rur^ncv in the
Mlchlgan TrUst ComPany
ness oi-tne currency in the sec Building.
sec

o

a^Zf"^s *£ *JKSf

Tt

fJ «L?v

Two With

Ed. E. Mathews

(Special to The Financial

!°+1?rnnd^S
^etuf,n But
°f financial
query: confidence today* But Query: Since a con-

This

asset

value

would

flashed in the Sixth Annual Re-

near

very

,,

port of the Johnston

..

of the portfolio.

remove

the

Mutual Fund

by its President, Douglas T. Johnpossible ston: "From here on
[defense
.

expenditures]

market risk resulting from speeu-

.

.

.

.

lation in Adams' own

STEVENS

rentable to
to fiduciary
fiduciarv investors.
investors A
A 1953
ceptable

BOSTON,

Mass.

Chronicle)

—

—

...

Formation of Investment Company

.

To Bridge

will be a sus-

tailing rather than a stimulating

shares and

SCUDDER

Dollar Gap Advocated:

force. Estimates of expenditures
Formation of an American "For- American investors with research
^n*oneW
^ surprisingly
equipment
for eign
investment Company" to fa- facilities needed for the exploraare again
highcilitate the piacement of foreign tion of the record, merits, advanresolution
has
been
introduced only slightly below the record seCurities in the United States as tages and disadvantages of every
proposing this very thing which level of 1952. The extent to which a means of aiding foreign coun- individual foreign security that is
will be voted upon at the coming the
productive capacity of the tries in bridging their dollar gap, to be offered on the American
annual meeting.
meetine
■
■ ■ "
ronntrv
alreadv heen
in- and the backing of such an agency markets, the firm states
v
annual
country
has already
been m
by aU influential members of the
The agency, sponsored by 111financial community, is urged by vestment banking and underwritV
the firm of Model, Roland & Stone, ing firms, could distribute foreign
■members of the New York Stock securities through its sponsoring
Exchange,
120
Broadway, New houses or could handle placements
York City 5, N. Y., in its current directly. "Leadership of the corn,1 Certificates of Participation In
monthly investment survey.- ™- pany would have,to be placed in
The Foreign Investment Com- most competent hands and men of
INVESTMENT FUNDS
pany would function in accordance the highest caliber, such as Robert
investing their capital
.
probably
„lvuaui,

CLARK

&

,

Gilbert J.
Bouley and Stephen P. Stuka are
sequent to such transition seem
likely. . .
T
siderable percentage of the voting now with Edward E. Mathews Co
ticipations might be redeemable
And another amber light is population did not support the 53 State Street.

logical stage of mutualization or "open-ending" so that par-

to the

to

3

,

with Wm.

E. Jordon is now

rence

1879-81 and 1896-1902 in this
"themselves ^5^iLtlnL^and Thf'remotal

well orderly fashion. Painful readjust,
step ments of one kind or another con-

Adams, the program might
be carried forward another

the

•

Chronicle)

Mich.—Law-

short

supports wear
out. It may well be possible that;
the ending of the postwar boom
will not have the tragic aspects
of a 1929-1932 but instead will see
the transition to a more stable
type of economy take place in an

International,
Express and

rities and U. S. and

there is

salary

and

U.

as

as^ f

term

common
control
S. and Foreign Secu-

under

such

American

experience

age,

Merlin*- and

(Special to The Financial

BATTLE CREEK,

has followed through a

groups

as

perman¬

Jack C. Siegman

(Special to The Financial

ones„provmg
observers believed that with the
TdwaT C,'iohnson 2d, PresiFrench
dent of Fidelity
Func^ also s^oun s businesg and stock prjces WOuld

tfy^°other'11^closed-end ural expectancy,

pursued

opportunities

for

However, Emerson W. Axe in

his annual report to shareholders
of Republic Investors Fund dis-

commendable program of merg-

top

industrials, preferably with portfolio ex«
of

analyst

Weslheimer & Go.

warning note in his letter to faU-or at least stabiiize But ac_
shareholders accompanying the (uaHy the retum of confidence
ing into one company what for- F dehty Annual Hepwl
ln the produced a sustained and sub_
merly were several other invest- further future, it would seem that stantial advance It is als0 inter_
ment trusts under common con- s me downward readjustment in ^
to recaU .the events
of

a

a top,
experienced,■;

analyst,

Closed-End

This group

out¬

2

*

Open-Ending

—.one

men

thoroughly
public

:

financial

Institution

WKh

J. G. Siegman

h°mH lnve

Trust

Tripp
Illinois

V

■*

proval).

bocker

ITS S. LaSall* tract, CtiUago 3,

<

granted SEC clearing on fairness
of
terms
and
stockholder ap-

Dravo

shareholders of record

were

bought by
of Boston,
Corporation by: KnickerFund and Agava Products

Shareholders'

February 9, 1953

Other

Products

Tecumseh

February 18, 1953.

*

in. 1953?

Chronicle)
agrees with these views and claims
Jack C.
CINCINNATI, Ohio
they give "too much weight to
superficial statistical analogy and giegman has become associated
overlook points of fundamental
-Jl westheimer & Co., 326 Wal-..
strength which are particular to nut street members of the New,:
the present situation. . ..... A still York and' Cincinnati Stock Exm0re important factor ... is the changes. Mr. Siegman was forchange to a more conservative Ad- merly manager of the corporate
ministration . .. but it is of course trading department for Bohmer-.
begin sometime in 1953, . would possible to imagine that the im- Reinhart & Co. In the past he was
find our productive capacity in mediate effect might be defla- with Edward Brockhaus & Co. for
excess of demand, competition tionary. In this connection it is many years.;• * *
• ■ '
from both domestic and foreign well to remember what happened
.
. ^
sources highly intensified and, in wjien
French franc was re- Joins Wm. C. Roney Co.
the complete absence of shortages, ^urned to gold in 1926-27. Many

share from investment income,

Chester D.

added to the

portfolio of the latter fund.
less
familiar
purchases

payable February 28, 1953
To

the

Austin Nichols also

dividend of 12c per

a

were

Administration at the
the support of the in-

rising levels of debt, and increas-

The imponderable of the international situation which may have

measures

accelerate

ing purchased by Republic Investors
and Axe-Houghton "A," and

Dividend

17th Consecutive

polls and

ingly keen competitive conditions
in domestic and world markets.

newcomers

during

present

pro-

that

Newcomers

Relative

question

longer this type

housing units are now being pro- ^
duced at a faster rate than family
formation, a decline in the future
must be expected. Thus, there is
considerable basis for the prevailing optimistic forecasts for 1953,
but they must be tempered with
a growing caution. There are other
discordant notes such as the persistent decline in commodity
prices (an indication that production has caught up with demand),
the tightening credit situation, the

ae

folios

much

day

Caution in Some Quarters
Notwithstanding the renewed
interest in acquisition of the oil
issues during the quarter under
review and the stepped-up tempo
0f purchases in general, caution
remains the watchword in many
representative management quarters. The trustees of the Shareholders' Trust of Boston state in
their Fifth Annual Report: ". . . in
projecting business trends and determining investment policy, great
importance must attach to the
foreign policy of the new Administration. It might very well be

shares
was
also made in Lorillard.
In
the
theatre
group,
Loew's and
Paramount Pictures were liked,
commitment of 11,000

new

how

expansion can continue. The vesting public is supposedly nec-f
111 ICJ boom in residential construction is essary for a sustained market rise/;
W*M expected by: many to continue are these analogies fallacious tq-;
through 1953. As, however, new

V*
.

of

to

# ' #%B1

At'

Kilt/111 IT

iflljr llljf

iAVVVlvlUlT?

E UlIIlw

' ■

V*

m

aflfalAVdlA

FnnHf

MUTUAL FUND

as

FUND, Inc.

them

make

11)OAC

more

muic

ac-

■

.

—-

..f

*

*

•

..

;

SCUDDER
;

STEVENS

y

•

•.

CLARK

&

•

principles observed in A. *Lovett, John J. McCloy or
underwriting _busL~ Allen Sproul, should be persuaded
to devote their agency and reputhe Securities land Exchange Com-Itation
to an enterprise of -this
mission.
Thus it; could provide kind," the firm declared.
with

the

ne

•COMMON

/:

; "

-

'

IN

■

BONDS

:s T O C K

ness

the

domestic

and would be supervised by

(Series B1-B2-B3-B4)

FUND, Inc.

laii

PREFERRED

STOCKS.

FOUNDERS MUTUAL FUND

(Series K1-K2)

Available
-

at

Systematic Payment Plan

Net Asset Values

Prospectus

on

.

Accumulative Plan

(Series S1-S2-S3-S4)

Income Plan

Request

Sqidder Fund Distributors, Inc.
1 Wall

F Ull

COMMON STOCKS

Prospectus viay

Prospectus from

your

local

investment

dealer

be obtained from

St., New York 5, N. Y.

10 Post Office

Sq., Boston 9, Mass.

Provident Trust

Philadelphia 3, Pa.




Xke

Keystone Company of Boston

FOUNDERS MUTUAL
336

Bldg.

50

C

authorized dealers, or

or

Congress Street, Boston 9, Mass.
DENVER 2

'

-

•

—-

1st

DEPOSITOR CORPORAT:ON

National Bank Buildin*.

Teletype-—DN 249

„

.

.

COLORADO

lume 177

Number 5194

The Commercial and Financial Chronicle

.

.

,

(701)
some

day

from

Securities Salesman's Corner
!

a

■

' '

,

'

,

•v

'

,

'

I

(Article 5—Part 2)
}.

The

"Using the Telephone

telephone

valuable time.

make

is

to

time.

you

can

find out for

life

next

not

or

should

you

It

see

at

you

be

can

your

save

lost hours of travel.

iielp

you

;after

you

to

transact

talk

pect-,

or

Your

Is

Person

Listen to
have

IHave

not

radio

:some

the

sat

Other

your

image of

just

announcer

from

There

the

make

phone

are

cold

are

personal—others

are

im¬

and

and

warm

voices

are

that

tense—high pitched and lack¬
ing in conviction. A good voice is

—it is
ds

;your

result

of

pick

you

"telephone to call

mental

a

of

of

the

up

customer

a

prospect stop and think
mate

It

projection

a

time

next

cabout what you

4and

voice

thinking.

own

The

pitched

voice with inflection.

a

the

low

to

person

the middle of

an

"to

is

the

other

going to speak; I
going to gain a contact with

^arn

am

that will

«nnd

to

talk

him

cause

respond.

to listen

I will not

will I drag it out.

nor

•^exactly what I wish to

over-

I know

and I

say

"will

say it clearly, concisely, and
friendly way." Then be your¬
self.
Don't
tighten
up
on
the

in

a

^phone but make it work for
Music

can

out

come

"•end of the wire

it

or

lection of discords.

ing about this.

of

the

can

be

I

am

I have

you.

other
a

col¬

not jok¬

people

seen

"Who have mastered the fine art of

^handling

telephone who could
^sell everything from newspaper
^subscriptions to charitable bazaar
a

••donations,
their
=see

and

who

customers,

them.

well

or

There

spaced

never

saw

expected

to

is

rhythm in a
sentence — there is

^something that will hold the at¬
tention of any one of us within

a

5good telephone voite that knows
"When

to turn

it

on, and when to
Practice, and trial
will gradually perfect
Your technique.

"turn

^nd

it

man

—

on

off.

error,

plain
is

««all

a

are

afraid

to

they might get
for

"will

be

an

a

pects that is true.
careas,

congested

some

But

the

at

sore

bridgeover.

been

in

interests.

world.

Don't

You

What

talk

My

about your

his

good
Brown,

is

just

report

a

'XYZ' stock.

Bill

helpful to
to

There is

released

company and you may

this

on

find it very

I would also like

you.

meet you

and I find that I am
going to be in your neighborhood
in the next few days and I would
like to come by to see you. Would
10

o'clock

tomorrow

morning

or would 2:20 in the
afternoon be better for you?" 1

Mr.

Jones—He

take

may

of several reactions.

one

say, "Who do you say
Or he may tell you
want

to

ask you

he

buy
how

following telephone approach

to

want

off

got his

Remember—you

him.

Or

more

his

interests

Sometimes

a

out

man

Don't

you

about his
that

for

A

out

the

great

you a

Wait

and

find
him.

concerns

his fears and his hopes.

word

You

over

Try

that

his

draw

investments.

opening.

something
Find

led

and

can

skillfully

so

phone that he will tell
deal

be

long sales talk—strive

a

discover

ideas.

give

may

will

catch it

the

you

if you

clue.

learn to

listen and to Warm up your tele¬

phone

approach
the

down

created

calls

cold

by

so

to

as

resistance

break
that

stranger

every -

another

I

you

interviews.
on

an

im¬

portant mission—you are going to

talk to

a

prospective client about




Start

right

with

him

you

Use

will

the

law

not

of

You

averages.

apopintments
approach. Some

arrange

their

stranger

is

whO

on

air this

The

is

of

use

rather

the

technique

believe

too

well

I

will

be

waiting to
ready
The

to

that

some

see

telephone

will

and

you

business

do

business

will

that

dignify

because you

have

an

appointment.This

you

off

to

the

interview

right

be
are

with

for

you.-

your

asked

gets
Sell

start.

Goldman, Sachs & Co. and Leh¬
Feb.

10

and

offered

associates

$25,000,000

,on

July

1966 of

10,

gen¬

telephone

in

a

could teach

you

class.

But watch

it
a

finished telephone salesman work

If there is

project

in your

one

sometimes.
tension

Make

out

ideas and

your

—

office
notes.

call

if

above

find

you

a

sell

all

the

can

—

common

relax

—

on

including working capi¬

say

do

to

meet

you.

It

tion of

of

The debentures will be redeem¬

able through the sinking fund

at

par and otherwise than through
operation of the sinking fund at
103% during the 12 months -be¬

ginning

Feb. 1, 1953, with suc¬
cessive reductions annually to par

which
and

these
ended

main

are

the

Combined
stores

Jan.

downtown

remainder

branch

sales volume of

for

the

31,

1953, exceeded
10 main stores

The

fiscal

year

located in St. Louis, Los An¬
geles, Pittsburgh, Cleveland (two
stores), Akron, Denver, Baltimore,
Youngstown and Sioux City. In
are

these

cities, with the exception of

store

15 branch stores

the

company

business.

now

include

units, three of which
in the Los Angeles

in the St. Louis area.

The

operated by

five
are

area

by

McCormick, President

condition.

San

San

Francisco, Los Angeles,
Jose and Beverly Hills, marks

the

first

ing

time

that

According to the statement by

McCormick, American
Exchange President, the
Exchange and its operating

Coast has

affiliate
A

ap¬

board.

-,w

>

•

as

a

boy

page

Summer

time

broker

of

1925,

office

,

several

He started

Associates*
Inc.
A

in

became

a

employee for

a

weeks

large
located

and two

c a a

change Realty

,

the New

on

r'i

m e

Stock Ex¬

the exchange's govern¬

on

Mann launched his Wall Street

part

\

Stock

representa¬

a

the Pacific

peared

-

Edward T."

-

tive of

e

m

S t

o c

n

Y i

d

c a n

Ex¬

k

$ecu4

change

rities Clearing
Corporation,

later, and,

following the reception of his BA
from St. John's
College, Fordham
University in 1928, he became one

showed-total

of

income; of

the

first

became
Curb

specialist's clerks

a

consolidated,

on

in

1933.

elected

a

change

and

of

man

In

of

became

the

Board

the

This

chairmanship.

resident

since

alumnus of the

Last

board.

we

exchange

the

first
a

to our board

largest market for foreign

secu¬

rities in the United States.

Now,
recognition of the
rapidly expanding Pacific Coast
economy
we
have, also for the
first time, elected a resident of
further

a

to

area

The

our

election

governing board.

of

closely allied to
the

extension

last

June

in

Mr.

Symons is
leadership in
trading hours

our

of

.

recognition

differentials

of

the

and

be¬

time

zone

cause

of the westward movement

of

the

nominating

elected to office.
year

of

terms

the

as

board

Halden.

L.

H.

as

committee

was

Elected to three

class "A" members
Charles

Buchanan

&

W.

Co.;

David S. Jackson; Charles J. Ker¬

shaw, Reynolds & Co.; Frank C.
Masterson. F. C. Masterson & Co.
and Edward C. Werle,

Johnson &

Wood.

While Mr. Masterson,

served

for

is

a

a

board

who

short period in 1937,

relative

newcomer

board, the other four

members.

_

preceding

operating expenses of $2,125,637.98, net operating income
for

the

stood

year

at

$36,772.60,

operating
057,457.40.
upon

At

are
■

the

surplus,
499

close
or

expenses

of $2,4
'

of

1952

!

Exchange

the

net equity of its
members, stood at

regular

$5,024,821.95, equal to $10,070
member,
$9,999

or

to

the

former

per

$4,989,529.35*
member at the end

of 1951.
:

The

of the

and

consolidated
American

operating

total assets of

balance

sheeti

Stock Exchange?

affiliates

showed!

$6,545,873.55 at the*

close

of the year. Current
assets,
including cash of $453,255.34 and
$1,710,140.00
in
United
States

Government bonds,
totaled
207,218.08. Current liabilities

u_

$2,were

$35,055.90.
con¬

tinued

to rise. Salaries, 55% of
operating costs, amounted to $!,-<
176,874.60, an increase of * $76,-

068.22. Taxes, 8% of costs, totaled
$159,077.11.

Mr. McCormick called attention
to the strong financial
position of
the

that

Exchange and made it clear
it

is

a

non-profit association

of member firms.

"We

are

a

non¬

profit service institution designed
provide efficient services to the

•to

investor

prise."
.

per

against

as

Most major expense items

prooosed by

were

the

With

capital and population."
The entire slate

for

year.

governing

to keep pace with our role as the

as

$2,179,593.46

previous year of $122,136.06 based

member of

a

31;

This

University

for

year

1952.

compared with net income for the

our

elected

McCormick

1922

California, is well qualified to
the Far West and Pa'-

on

T.

with total consolidated income of

1950.

Mr. McCormick noted that "Mr.

an

E.

Vice-Chair¬

Symons, born in Butte, Montana,
and

year

compares

third consecutive elec¬

California

the

ended Dec.

ex¬

in

tion to the market's

for

stock spe¬
1948 he was
a

Governor

marks his

a

$2,162,410.5 8

member of the New York

Exchange and

cialist

that

1977.

The May Department Stores Co.

stores

9, ac¬

Stanley E. Symons, part¬
95-year-old Sutro & Co.

in

previous*

year

also stated that the elec¬

was

ner

$122,136 the

exchange.

Canadian

department

Possibly

of the

Feb.

announcement

an

Edward T.

and improvements to its facilities.

first
Even

to

time,

of

a

r

,

emphasizes
Exchange "is a non-profit service
association," and despite small
earnings, is in sound financial'

Stanley E. Symons

elections held

tal and expenditures for additions

your

appointment.

annual

cording

cifi^.preas

1,

as

Co.

President McCormick

Reich

be available for general corporate

Baltimore, Denver and Sioux City,
the company conducts the largest

denominator.

with
Loiiis

represent

Feb.

&

Income in 1952

of

on

Symons began

Sutro

as^

Curb

Net income of $36,772 compares

company's general funds and will
purposes,

careers

outdoor

Reports Reduced Net

The balance will be added to the

per¬

only arrange it for 10
this: "Mr. Jones, I

minutes,
want

subsidiary.

your

sonality.
But

a

old

of the Curb
trading floor. 1 Mr. Mann

May Department Stores Co. 314%
sinking
fund
debentures
due

to

Street

the

Mr.

American Stock Exch.

the

May
Dept. Stores Debs.
Brothers

a.

of the

Governors,,

new

.

career

first.

Bankers Offer

man

elected to

trustee

as

Wall

on

clerk with

York Curb Market.

the

am

that

runners

pres¬

salesman,

there

was

the ' three

their

gan

begin to

can

operates 25 department stores, 10

realize

eral.

Then
are

far,

Presi¬

first

fa¬

a client that will
rely upon
advice and suggestions dur¬
ing the years ahead.

may

name.

talk

to

you

meet

into

to

great deal of time and
better

that

new

Mr. Masterson and Mr. Reich be¬

Market.

your

the

1921,

the telephone.

gone

are?"

you

Of

Frank C. Masterson

Mann

build

ent

McCormick,

well-

under

contact

a

J.

con¬

about his holdings on the tele¬ Feb.
1, 1978 at 100% and accrued
phone. Now here is the fine point. interest from Feb. 1, 1953.
When he starts talking, keep him
Of the net proceeds from the
going.
Lead
his
conversation sale of the
debentures, a total
along your lines. Don't get off the of
$7,910,719 will be applied to
track.
Project your personality. the retirement of two
214% prom¬
Assure him by your
brevity, your issory notes due
May 10 and Aug.
voice inflection
and
your
com¬
1, 1953, a 3%% mortgage due to
mand
of the situation that you
July 1, 1971, and a 4% note due

the

by^ making a personal
able to master the

will have

making

any

He

he doesn't
stocks. He may

any

you

wish

may

Take

.you

by

over

$440,000,000.

you are

and

in.. the
are

gratuity fund.
John

fellow

your

his financial

time

I

office

helping

R.

three year term

en¬

is

Bench and

members.

Market in

ef¬

or

be

satisfactory

in

a

with

preserve

E.

to

"B**

dent of the indoor New' York Curb

business,
It

with all those you
morn¬ will be satisfied with

JoneS,

name

important

an

good business.

a

board

your

are

class

as

have
served
Reich and Symons

past.

a

broker, advisor, or
Brown
of
the Blank Securities customer's .representative. Others
Co. You received a card from us will only waste
your time.
But

listen

save

in

You

vorable circumstances.

about

Here goes!

You—"Mr.

You will find it difficult to obtain

will

is

gushing

Remember:

gaged
it

be

■

■

elected

were

terms

McCarthy

you

by the warmth of

don't

Symons

year

members of the board.

Then by ap¬
pointment see him and begin to
just sell him on you.
After he has

Talk to him about

at it.

interviews

fusive.

which

upon

Mr.

three

first approach to
Take the cold re--

your

prospect.

serve away

Find

>

Beane; Louis Reich, Reich & Cou
and

contact (no mat¬

or

slight)

make

your

leads.

your

spark

how

post in 1947, 1948 and 1949. Kershaw was Vice-Chairman of
thfx
Edward C. Bench,
Clark, Dodge
Co.; Michael W. McCarthy, Mer~
rill
Lynch,
Pierce,
Fenner
&

sue-,

favorable

your

buildings, and other plices where

call, if

common

pros¬

in certain

cities,

great

They

turndown if they

by

with

stores.

appointment.

rebuffed

years

Follow

cess.

suggesting here
requires patient handling.
You
cannot learn it overnight, nor do

prospect because they think

;ask

for

nique

Mr. Werle served three terms as
Chairman.
He held that

.

Board

Board in 1951.
'*

tech¬

the

first step? Connect your
thoughts with his. Use a familiar

"The Appointment Is the First Sale
salesmen

this

being. You can only help him if
he gives you an interview at a

telephone.
Some

used

the

important task—
been rushed—per¬

have

may

have

have disturbed his routine.

yourself

Say to yourself,
important to the person

whom I

Jhim

Exchange,

reelected to that post for the
next 12 months at the market's
was

orig¬

or

have

man

turbed—resting—dozing—or

a

Cre¬

say.

of

on

or

moment

a

wish to

image

a

•»end of the wire.

"■"This

your

may

;are

moderate

—

receiver—he

ing!

dull—flat—monotonous. There

There

telephone call

a

rings

iare

friendly.

First

Remember what happens when
you

yourself.

that

Interview

new

Some of the best life insur¬

cerned

Sell

inspire confidence —
«cheer—optimism—and cause you
"to listen.
There are voices that

that

voices

no

in handling the following
telephone conversation.

he

by

mental

"the sound of his voice?
voices

have

can

announcers

often
a

should

you

is Im¬

not

men

voice but

sincerely

is

ance.

believe that your business

cus¬

pleasing personality.

a

you

to

radio

jradio and made

--a

suggested,

inal.

can

the Phone

on

can barge in and
without any planning

other end of the line picks up his

You

the

some¬

your propo¬
sition of much consequence. Think
about this.
But if you

customer.

Voice

-

..-are

you at 10 as I

This

too will not consider

and your pros¬

you

Make It Im¬

think it is

gested.

ter

technique of projecting
;your personality, and your ideas,
^skillfully over the long miles of
between

is

preliminary arrangements then
certainly can be sure that he

master the

;space

health—that

or

suf¬

you

his

you

It won't make

unless

you

in

you

about

trouble

for

his

If you

thing that

But you must learn how to

personal

the telephone.

;sales

portant.

portant

of

to

thing

can

business

your

important

his financial future.

inter¬

necessity

-who

of the American Stock

we

terview.
Make
that
sale
first.
Give your man a choice of "when"he can see you as I have
sug-V

you

that they will not feel

so

views.

It

established

ficient confidence with

tomers,

of

means

many

have

client

a

specified

a

communication that will

•aise

you

would 2:20 tomorrow afternoon
suit you better?"
Go for the in¬

"

most

save

personal call, or if

a

able

the

see

Exchange Elects Officers

John J, .Mann, Board Chairman

get to know each other and I
give you information, that I
sure will be valuable to
you.

Can I

Arrange Interviews**

to

the

can

It

whether

.you

American Stock

has

important;

or

u

...

benefit

firm

stay but 10 minutes if
wish, but in that 10 minutes
can

BUILDING AN INVESTMENT CLIENTELE

Our

will

am

f

both

can

contact.

many contacts that are

can

By JOHN DUTTON

we

this

29

and

corporate

enter¬
,

•

The Commercial and Financial

Chronicle

...

Thursday, February 12, 1953

(702)

30

Continued from page

and

9

doubly hazardous

dends.

Reporter on Governments

Our

•

The money

By JOHN T.

CHIPPENDALE, JR. =======

markets are getting back

of the 2V4$ taken than there were 2y2s. The
that liquidity is still a very appealing factor as
far as the money markets are concerned. The fact that less than
7% of the holders of the Feb. 15 certificates turned in for the
longer 2M>s was not exactly as favorable a development as had
been expected in some quarters.
many

more

figures showed

be taking on a divided
that is the shorts and the intermediates appear to be
group, with the most distant maturities in the other one.
government market again seems to

The

appearance,
in

It

one

opinion of many money market followers that
the' uncertainties that face the government market,

is the

of

changes
to

be

as

because
due to
in debt management and credit policy, there is not likely
much attraction in the longs, as in the other maturities.
Change in Debt Policy
refunding out of the way, the money mar¬

With the February
kets

busying themselves with ways and means

are now

of hedging

against the uncertainties that always accompany a major change in
debt management and credit policy. There seems to be very little
doubt among most followers of the government market that the
new Administration is going to make changes in the methods
of

management of the public debt.

handling credit policies and the
The increase in the rediscount

direction, and this was followed in turn
of refunding obligations carrying higher coupon
been in use by the previous Administration.
the

in
by the offering
rates than had

rate is considered the first step

new

policies will most likely be just
come, with not a few of the
shrewder followers of the money market of the opinion that a
long-term 3%, ZVs%, or even a 3%% obligation will be used for
refunding purposes before the year 1953 is over. President Eisen¬
hower, in his State of the Nation message, indicated the need to
cut down the large floating debt by means of refunding operations,
even if this might have to be
done at slightly higher rates of
These departures from past

of other things to

the forerunners

interest.

Initial Effort
The Treasury got a
when

offered

it

the

Success

a

start in the refunding of the floating debt
ten-months 2Vz% issue for the

five-year

maturing 1% % Feb. 15 certificates. While it was not expected
that the holders of the 1%% February certificates would exactly

panicked by such an offer, to the extent that owners of the
maturing l%s took the longer 2Vzs in exchange, there has been
an extension of the floating
debt. This is a favorable develop¬

be

ment and successive

operations along these lines could result in

of the floating debt

more

being moved out into longer maturing

However, whether this first refunding operation is
going to set the pattern for future ones is largely a matter of
conjecture, but there are quite a few in the financial district who
hold to the opinion that future refundings will not be less favor¬
able than the recent one, and more favorable terms would not be

obligations.

unexpected.

Reaction

Market

Therefore, while the money markets are going through the
current period of uncertainty, the short-term obligations are ex¬
pected to get most of the attention of those that have funds to
invest in government securities.
The feeling is that while the
course of yields on Treasury obligations is uncertain, and is likely
to trend upward, the best place to keep one's funds is in the nearterm liquid securities.

who cannot keep too large
mainly, and as a result they

On the other hand, there are those
amounts of their funds in short-terms
are

making commitments in

the' intermediate

term

obligations,

this gives them a

somewhat larger return than is available in the
Likewise, they are not inclined to take posi¬
tions in the longest maturities of governments even though these
issues seem to have fairly well discounted any offering of longerterm governments that might come along in the future. Because
of the feeling that the most distant Treasuries still embody, many
uncertainties, there is not likely to be as much action or interest
in these obligations, as there will be in the shorts and the inter¬
mediates, at least until there is clarification about what will be
done by the powers that be about credit policies and debt man¬

shortest maturities.

agement.

Credit Restriction
It had been believed in

tration would rely more on

trends

nomic
seems

consumers'

appears
a

Possibility
new

Adminis¬

the indirect method to control

country,

especially the

loan

curve

eco¬

which

important forces in the picture from

of being an unfavorable factor.

The sharp rise in

loans, since the elimination of Regulation W last May,

created

to be

the

to be one of the most

the standpoint

has

of

a

quarters that the

some

concern

among

to be considerable of

many
an

monetary authorities.

opinion

now

There

that there may have

resort again to the direct method to slow down the trend

of these loans.

*

t

War

World

preceding

tury

know

might be said that the department
store industry approached matur-

World War-1 peindividually
department
stores
have
developed
subsequent to

ity around the
Few

owned
been

new

not the rate of consumer accept-

1920, few retail

to

the

the

no

growth

the

rule

exception.

We

industry ever had
possibilities than

automotive

industry at

grow more

growth a fair measure of the
rities were publicly owned. Retail effectiveness of competing types
securities came to the "big board
of distribution?
This is the point
in the 1920's
after the depart- on which far too many analysts
ment store industry, as such, was have foundered.
First, one must
relatively mature. It had at least acknowledge that the number of
passed through its adolescent pe- department
stores has not inriod, the period of most rapid creased measurably over the past
development.
The
fantastically 30 years. Secondly, many factors
favorable aspects of the financial pertaining to location, real estate
development of this fabulous in- situations, etc., have been a redustry during the period of its tarding influence on the expanPrior

that

individual

of

almost

discovered that people the turn of the century but that
rapidly in their first
almost 2,000 companies
20 years of lite than in the age launched, only a handful reached
bracket of from 20 to 40 years. A
1930 depression, much less
man's effectiveness is not meas- survivec} it, \ye know that even
ured by rate of growth and does today there are hundreds of chemnot cease upon reaching maturity, jgal companies getting nowhere
Neither does that of an industry. fast
One might well ask "Why is
j 'know that Allied has taken

War I.

World

did

failure

is

to divi¬

as

recognize that
growing indus¬

I. istician

Many of America's great fortunes
were built by it in that period.
It

riod.

,

j

.1

fully

than

rather

greater

•

..

.

that

companies

As Investments

into stride again, after

period in which the primary concern of followers of Treasury
obligations was the refunding operation. The government had a
successful deal in its first refunding operation even though there

that

were

tries

Depaitment Store Securities

We

in the fastest

even

secu-

ance

—

OVer

two

chain

organiza-

store

tions and has refused to take over
dozens of them that have been
available. How many companies
^be more rapidly growing forms
0f distribution can you name that

bave been in financial difficulties

jj-j ^be past quarter century9 Can
y0li match them with an equal
number of department store companies? Of course you can't. Yes,
youth is wonderful—It seems almost criminal that it is always
most rapid growth were never a sion Of those department
stores wasted on the young and inexpematter of public record. The se- that did exist in the World War I rienced.
There are advantages in
curities of the department store period.. Thirdly, one must ques- investing in mature industries. The

tiOn. The number of chain store greater safety of matur-ity entitles
sucb securities to a high "multipiier." The department store in¬
dustry is an effective, mature industry and is entitled to be rections, and many universities went have been made by one or more ognized as such by the investor,
into the "statistics business" fol- -°£ these chain store companies in- bis advisors and the analyst. lowing World War I, again, after eluded in the comparison regardthe
department store had ap- nig sizer-and type, of unit operPopulation Migrations
proach maturity as an industry, ated. Only by eliminating the unThere has been one fundamenThese statistics were reasonably comparables can one compare, in- tal factor that has been working
complete and accurate as to all terpret and get a true measure against the department store in¬
forms of distribution.
Their tim- °f effectiveness. The true meas- dustry over the past few decades,
ing, however, was such as to catch ur.e °f relative effectiveness in that of a migrating population
the department store industry at this highly competitive field can away from the inner core of the
or near maturity and many other
ordy he taken on a unit basis and larger cities—the homes . of <the
forms of distribution at birth or not on an industry basis. On this department stores. This migration
in their years of most dynamic basis, and eliminating the effects js 0f two forms, i.e., migration of
growth. I contend that this ma- °f policy-changes on the type of the city dweller to the suburbs
turity period vs. period of imma- chain store unit operated, the de- and migration to the smaller and
turity, and, therefore, of rapid, partment store continues to stand newer cities and towns. The aqtogrowth, is important if we are to UP as a highly effective form of mobile was chiefly responsible for
interpret
properly^ rather than retail distribution in this year of the first. Decentralization of inmisinterpret the valuable statis- 1953* •„
... .
dustry generally, the development
tics that are at our disposal. FailAs further proof of this growth of the rich natural resources" of
ure to recognize the uncomparable perh^ V&
maturity premise, I the gulf coast and the northwest
aspects of that which is 'being... would like to point out that many and a fuller appreciation of .the
compared has resulted in many fundamental policy changes af- climate of such areas as Florida,
false conclusions that have been fecting the t y p e of unit and California and Arizona have been
harmful to the market of depart- breadth of lines carried have been responsible primarily for the latment
store
securities
and
its necessary within the past decade ter.
"multiplier."
on the part of most chain store
Much consumer purchasing- is
We all know that many so-called
chrf
in
doni2 near where tbe consumer
statisticians
and
analysts haveunf/hn^ nr^in lives as a matter of convenience.
companies, therefore, were never

credit for their marvelous
at ,w?re included in
earlier performances by the in- we general statistics, the number
vesting public.
un"s operated by each comOur government, trade associa- Pany
and what policy changes
given

,

,

,

„

.

taken

statistics

to

as

to

seem

petitively
forms

of

so

them

that in this
the
department

against

up

distribution.

scrap

*be

™ta*'

erowlnfi Each of the forms of mi8Tat^on

ranidlv

*aPldly

Tn

mentioned resulted in a decline of
actual number of customers -for

l940^ in the exactTame DOsi- the big downtown department
*nfl*~c?nrL stores of the larger cities. At least
^ a:dei^
what would have been obtained

the

com-

newer
They con-

This, I want
to challenge in no uncertain terms.
Department
stores
are
mature,
yes—obsolete, no. It seems to be
the

The

+otal

*

certain

elude, or at least infer, that the
department store is an aged, high
cost, ineffective, obsolete form of
distribution that is about ready
for

fn

prove

just cannot stand

store

and

interpreted

world

modern

issued

as

and

assembled

Thf

ce|s^ f0 bT effective
Maturity

heap.

^

]ess

Would at

tiori)

way

of

had

normal growth has been syphoned

incom-

the industry has actually been

off to a substantial degree ; by
these migrations. In addition,
vs. Growth Investments therefore,
fo the department
well informed audience store industry being mature at or
this point pose the ques- about the time of World War I,

p*

^

by these stores in the

w?

Thev

''
,

"Well,

granting

the

parability of statistics and your suffering from what
might , be
premise of maturity vs. growth, termed a low grade infection since
of rapid growth
represents ap- wby should one choose maturity then. This is a point that should
proximately one-fifth of a useful as against growth?" This sophis- n°t be overlooked by the analyst,
life. There is a long span between ticated audience,'of course, knows This weakening of the department
maturity and ineffectiveness. The the answer. We know that'invest- store within the field of retailing,
period of rapid growth of the de- ments must fit the desires and however, was a result and not a
partment store industry was from needs of the individual investor, cause. It did not reflect on the ef1880 to 1920.
If I am arpund in pye know that if one can afford' fectiveness
of the department
the 22nd century, I am going to |0 rjsk his principal, does not re- store when viewed competitively,
be
looking for obsolescence in qUire a continuity of substantial R simply reflected the fact that
a

rule of all

period

life that the

people were moving to localities
that were not of the size and
individual units therein.
i
an(j js willing to assume that he character that would support this
For one to take statistics, indus- can be so fortunate as to pick the particular type of retailing;
try by industry, and find that right individual company .within -' -The fact that an-industry is

my

chosen industry—and I mean
such and not certain

income

industry as

in

the way

of percentage

earnings paid out as dividends

.

-

certain types of

panies had
in

a

certain

a

growth industry that the opportunity for capital .gains is great.

distributive comrapid growth

a

decade than did de-

•

more

the other hand,

On

most com-

consistently losing customers,
however, cannot be disregarded
by the investor or the analyst,
regardless of cause. There are
those who unthinkingly question
the alertness of the depaitment
store operator in his not following the customer in these migrations rather than apparently just

panies in rapidly growing induscomparison as a measure of mer- .tries are either relatively young
chandising competitive effective- or inexperienced Avith the nature
With Pame, Webber Co.
With Reinholdt & Gardner ness and as proof of obsolescence and scope of their principal ac(Special to The Financial Chronicle)
(Special to The Financial Chronicle)
is carrying the psuedo-science of tivities.
This poses management
LOS ANGELES, Calif. — Wil¬
ST. LOUIS,
Mo. — John H. statistical analysis much too far.- risks of- the highest magnitude,
liam M. M. Beamish has become Cragin has become associated with
Financing problems of a leading sitting
t
affiliated
with
Paine,
Webber, Reinholdt & Gardner, 400 Locust
^company in a rapidly-growing in- trends. 1
Jackson
&
Curtis,
626
South Street, members of, the New York
and
of. what
Spring Street. He was previously and Midwest Stock Exchanges. In mo decade than did department.
with Walston, Hoffman & Good¬ the past he was with Edward D. stores is about as staggering inuts ^awns -- hazardous from, the store "is and .what makes it tick,
Jones & Co.
implications as if some other stat- viewpoint of capital preservation A department store is an instruwin.




partment stores and then use this

-

of^--pn^tion

a* d^aSment

I

Volume 177

merit

of

order

to

we

..

.

The Commercial and-Financial Chronicle

distribution.

mass

have

In

is

sumer

have

the

masses.

did

not

these areas to which

The

in

exist

people were

migrating during the quarter

Allied

opened

Seattle

eate

its " first

.

It

ooened

It

the

and

chains

with

their

When the effect of these migrawere buried in our overall

government spending.

second

a

hi the suburbs of Boston in

forms of retaiUng—the Independ-

smaller* units—could and did fol—
low. the consumer.

employment, high wages and satisfactory agricultural prices, each
admittedly supported by enormous

pre-

tury following World War I. Other
ent

hig land ownership
leaseholds!

for

^as

such

more

By H. E. JOHNSON

assume

that.vgovernment spending will be
substantially less m 1953 than it

long term

or

seven

Bank and Insurance Stocks

I know of

110 reason at this time to

1951

has definite plans (includ-

n0W

in

1952

and

This Week

ce to the contrary, it appears
country-wide statistics, this dreaming of the establishment of reasonable, therefore, to assume
was another factor which made it one or more of these coordinated
consumer purchasing in 1953
appear that the department store "one-stop". shopping centers. It is J?™ P^°bably closely approximate
might well be becoming an inef- our opinion that many mistakes ina*
'
fective obsolete form of retail dis- will be made by the inexperienced
ii one wanted to be somewhat
a

Rather

tribution.

than

criticize

in these

developments.

We

,

not

confidence in this type of developfoolishly endeavoring to do uient if done properly and we be-

that which his institution

was

in-

Iieve

that Allied's

early

in this field will

capable of doing well, we might ence
commend

prove to

+u„«.

sketch of.what

The Smaller Rapidly Growing

ishappening

way of (a) bringing department store techniques to the

in

Cities

the

foreseeable factors.

Even

wages or perhaps even

duction

a

For

'

population trends of

many

of the

ing in size from 25,000 to 100,000
were beginning to
represent markets which could be
cultivated profitably by the application of the principles and
techniques of metropolitan department store merchandising. IVe
decided to do something about it.
in population

Allied now has 40 units operatm
ing in such cities, having added
three in the past year. There
definite plans to add one or more
irf 1953.
The migration pf the
past five years has resulted, in the
opening up of many'new such

re-

could

which

markets

cultivated

be

can

jng
There are upward pressures on
?"at w"at has Jeen a retarding operating costs for the retailer,
IiithiGnce on department store As wage rates mount and as the
growth in the past quarter century retailer finds himself working
is riow being conyertedinto a pluswith plant and equipment ,acfactor that promises to reach sub- quired at current high cost levels,
stantial proportions^ within the the expense problem is one that
ec? Jy
turning of a cannot be overlooked. On the
n^^ .ve influence lnto^a positive other hand, -the elimination of
°£e is certainly something that priCe controls will enable the re-

as

,

the

consequence,

overall

In every

was

developments inthis field:;; Un-;baps te/eason that r^taUers^
dpubtedl.y, other department store low this fashion more closely than
companies will be seizing these do the leaders of many other inopportunities throughout the 1950 dustries-is because the retailer is

yea r earher.. This sho
that the retailer should not only
beahlei, to^do- a
;e«echve

Allied

storp

the

department

evnects

in

decade

'nessaieiy and particularly retail-

rnntimif^ *ers>

to do

"fashion"

™

forecasting.

some

by

conscious

4

The

convenience

mirohasW

of

ion."

With

these

small

-

local

.

-nt

w

,

I

am

Fire

Aetna

j vim

number of these

Summary
As department stores enter this

in

industries

as

Fire

have

been

successful.:,,

universally from day to day as the true picture is unveiled.

—

,

branches established alone,'

-Such

however,

are

-I

considered

only half way meaS- good

.?*

over

1952

was

now

a

5.11

-

6.75

4.89

6^6

6.30

-

6.60

4.36

6.81

3.40

-

3.75

3.54

421

3.00

-

3.25

2.41

322

a

as

in

an

endeaVor,

to " 6ustomfer£

many
with

pear

to have'been present'as we

inconvenience

look

the year 1952,
caused more Iiy the abnor-

as

it

still'

means

were

back

over

in a" shopping tour 'malities Pf 1951, which period was
all the accompanying prob- used as a comparison, than by any
stops

lems of traveling, parking, etc.

Allied,^
tomer

we

change; in

the funda-

-

oarmonue,

is

accelerated

recen-" 1952.

Head

Prmrp

pre-planned,"'pattern on a month to month basis. reucuuiii. x ii i*.c
fully coordinated "regional ;shopThe year. 195? was a good year, * Frederick H. Prince, member of
ping centers which- are equipped, in retailing because there was an the New York Stock Exchange
te serve
practically every con-; adequate purchasing power, an and other Exchanges, passed away
sumer need.
In other words, we, adequate. supply of .merchandise at his home in France at the age
believe that the suburban con- and
a
reasonably stable price of 93.
establishment"

of




,

to

2.90

5.09

3.50

2.17

322

4.20

4.50

2.87

4.02

11.50 -12.50

923

12.05

3.50

-

3.75

2.98

3,66

5.75

-

6.00

4.87

5.47

5.75

-

6.00

5.45

5.35

6.50

-

7.00

3.88

6.65

9.50 -10.00
2.10 -2.30

5.92

7.82

1.97

226

4.75

-

5.00

4.00

429

3.80

-

4.20

2.12

.5.58

3.50

-

3.75

3.45

359

2.00

-

2.25

2.14

222

BREAKDOWN OF—

Govt. Bond Portfolios

Sources of Gross Income

the Government in

.

17 N. Y- C.

26, Bishopsgate,
London, E/ C. 2

Office:

Branches

in India,

Pakistan,

"

WUl

Ceylon,

Kenya,. Tanganyika,
Uganda, Zanzibar, and Somalir

be

Batik Stocks

sent on

request

Burma', Aden,

Laird, Bissell & Meeds

land Protectorate.
.

4.75

3.75

Kenya .Colony and IJganda

& Co., 52 Wall Street, New York-

H

—

4.50

of INDIA, LIMITED

year of1 with, Newburger, Loeb .& Co.
We have behind us, there""" "

by 'the fore, a year that can be used as a

Fire

NATIONAL BANK

City office of Barm.onde, Gilliland

formerly

;

-

—

Westchester

Cillilland

was

Insurance

Fire

U. S.

Bankers

Mr.' Sealy

America

Co. of North

Springfield Fire & Marine—-U.
U. S. Fidelity & Guaranty..—,-

potential

Hampton S. Sealy has. become
associated with the New York

City.

—

St. Paul Fire & Marine-

believe that the cus- "mental trend' within the.

is better"served and

tralfeation

In * important

With
-

—

Phoenix Insurance,

,^e

but alsd results

unnecessary

—

Hampshire

Northern

for retailing. It was also asset, - What should be the effect
in
quitt SOme
of these favorable factors on the
types of shopping but leave many when there were no abnormalities,
T¥ni.iHnll,1,, rn...
other types on a completely de- 0f great magnitude injected into dePartment Store multiplier. This
centralized basis." "This not oillyT our operations within the year, question I leave with you.
detracts froim the dynamic force Such, fluctuations in trends as ap-of the

Philadelphia

(Newark)

Insurance
New

year

year

of

Insurance

Home
.

the past quarter century can

labelled

1.66

6.25

American

Great

P«»ulaUon

he

-3.98

2.47

Glens Falls Insurance.

"°ns that have been a liability

'

that

2.33

About 1.00

1.93

Association

Firemen's

diversification

communities,

.

2.01

-

3.79

Fireman's Fund

,

branches

10w46

2.40

2.20

5.40

Federal Insurance

and flexibility, (b) that .they .are
part of the most fundamental of

rela-

$5.85

6.97

2J75

Hartford Fire

his

$2.51

-

Hanover Fire

to

$4.75 -$5.00
10.25 -10.75

-

the need for them

retailer'due

.(1948-1952)

2.50

-

.

ultimate

•

1951

Casualty—5.10

Insurance

Boston

Ma J Pr tivelv rapid inventory turnover exists as long as consumers conbranches
of downtown
depart- an(j the inherent
flexibility of the sume, (c) that a great amount of
stores
have
been launched
in retail business.
While we must their patronage is assured purely
areas-'Containing numerous small make certain assumptions regard- ,as a matter of consumer habit,
suburbap
immunities in the-post ing the future, we always know an(j /a\ that the nooulation miaraWorld
yfstr ;il period.
These that, modification can be made

suburban

.

Surety

Continental

relatively favorable 1953 outlook,
let .us remember in our work that
(a) by nature they represent the
near

i._

5-Y r. Axer*

1952

.

American

not

certainly no
admirably 0^er
the chief executive
equipped.
jA retail unit large officer of
large companies must
enough to, be representative of a ggtgjjjjgjj
a
framework
within
larger downtown department store ;which he intends to
operate. This
<"aia
? supported, by an .area ;jg"not too serious a job, however,

'

Approximate

,

Estimated

American Insurance

markdown factors.

ho

crystal ball.
prophet. On the

the department store is

a

-

.

training, selling job but should also benefit from a lower markdown or

.egardlngathe £ut_

suburban.communities, the opportunity. then.
^^se|i(bi3 -itself for a cT0Sing comments!
recentralization ol retailing. This,;
Economist. I have

which includes

volume is

.

m-y
, A

of course, is Just the job for which

where

recognized that these figures are on an adjusted
basis and not necessarily the way the different companies will
report earnings to stockholders. In other words, in order to show
a more realistic record of operations and as is the common prac¬
tice, Geyer & Co. have adjusted the figures for changes ;in the
unearned premium reserve and have made their estimates accord¬
ingly. In general the computations for 1952 make a favorable
comparison with those of ,the previous, year.

Agricultural Insurance
spotted

than

It should be

Price reduction rate. It would
Not directly ior this rea- seem reasonable tb expect that int imtSS
Smelen son,- however, but rather because creased expenses if well controlled
'resented a decentralization of re-."1066 ^sponsible for your proSuburban Migration

marked

As an indication of the earnings to- be expected in the coming
weeks, a tabulation of 24 major fire and casualty companies, is
presented below. These, estimates and the computations of prior
years' earnings were recently prepared by Geyer & Co.) 33 Wall
Street, New York, N. Y.

Our experience has taught us that
it is expensive to be "out of fash-

;

I

more

.

rela-

Per-

by

be

-

1953 should compare favorably
post Christmas period, with that of the year just closed.

it becomes the fashion for busi- The retailer's inventory

should

,

?£®inaLm^kup of the rejailer £>r

Current Outlook

•

a

1951

over

exclusively in fire lines. Final results will reflect
these differences. In general, however, most companies are ex¬
pected to show a moderate gain in statutory underwriting profits.
In the investment phase of the business, most institutions con¬
tinued to achieve favorable results. A larger volume of funds
available for investment accruing from a higher level of premium
income and retained earnings broadened the base of security hold¬
ings. Then with dividends on equities well; maintained and higher
interest rates on fixed income obligations, net investment income
was slightly higher.
*
,v
y
-r —
The gain in Underwriting profits necessitated a larger accrual
for taxes. Nevertheless, final operating results were above those
of the previous year.
;
o

-^y-you • taller to follow.more equitable
de^ *ncmg policies, item by item, and
r'„,

underwriting, condi¬

concentrated

«

fively
well balanced at the beginnmg of 1953 which could not be

profitably

ment

jated one-stop shopping center
because^ there is every evidence

Parlment slor* companies.

of the other classifications of

some

Workmen's compensation, on the other hand, presented a difficult problem for most
companies writing this line, largely because of an inadequate rate
structure. However, there was some improvement in operations
oyer the unsatisfactory showing of 1951.
'
The two large classifications of business, however, fire and
automobile, accounting for over 60% of the total volume written
by stock fire and casualty companies, dominated the underwriting
operations.
'
This produced a result wherein the large companies writing
both lines will be able to report a favorable gain in earnings pri¬
marily because of the better trend in certain casualty classificat¬
ions. Of. course, the experience will vary from company to com¬
pany depending on the breakdown of business written and. the
character of operations including, underwriting policies. In ;other
words, where a company has been writing a large amount of
automobile liability and property damage business, the improve¬

became

smaller cities pf the country rang-

time; fire

same

with profit margins generally satisfactory.

possibly result in
apparent to Allied smaller rapidly growing cities, and actually more take-home income
Stores Corporation ; around 1935
suburban branch store jn 1953
in 1952 which are
that the then present size and ana its relationship to the coorai- additional possibilities as cushionIt

At the

favorable underwriting profit margin

a

tions varied considerably. Overall fidelity and surety results were
about the same as in 1952 although there was some variation be¬
tween the two lines.
Accident and health continued to expand

higher
tax

show

with some gain in earned premiums, statutory profits were
generally above those of the previous year.

.

,

the record losses reported in 1951.

and

be

the

-r

over

lines continued to

S

department most beneficial in the years ahead
tup ®
nf nc
stores wnen they are not faced
store operator of that period for
•
with an accumulated deficiency in
his wisdom in not frantically enI have reviewed the effects of such
things as appliances, autodeavormg to do that for which he population migrations and their mobiles
and
housing
While
I
was not equipped.
Some depart- relationship to the .decentraliza- would not advocate the idea that
ment store operators did endeavor tion of retailing away from the esdepartment stores are going to be
to-establish small branch stores in tablished downtown
department the beneficiaries of a diversion of
that
periodbut
such
small store because I believe that a consumer dollars which have been
branches did not reflect the char- thorough
understanding of
this going to meet these needs over the
acter of the mother store and as picture is necessary if an analyst
past few years, I do believe it is
a ^consequence, their success was
is to truly analyze. I have en- proper to mention this factor as a
mediocre at best.
deavored to give you a thumb- cushion
against some of the unwell

mobile

.

experi-

period just ended was a good one for the
industry. While the experience on the important auto¬
lines Was not entirely satisfactory, it was much improved

insurance

^rf;2?1-1i^lsilc'i)ne couJ.d rc:fer J0
kk®uhood -of S°me
lrJ

have

the department store operator for

Insurance Stocks

On the whole the

total

....

—

Operating results of the major fire and casualty Insurance
companies for. 1952 to be published over the next several weeks,
are expected to show considerable
improvement over those pf the
previous year.

annual

an

on

^asis ^ might be even higher. In
ubsence of any convincing evi-

shopping centers. There is hardly
hamlet -today, (or perhaps even
real estate man)
that is not

a

tions

-81

to "one-stop" level.
The adequate purchasing
recentralized basis, power of 1952 resulted from high,

a

planned
coordinated
"one-stop"
shopping center in 1950 in North-

cen-

(70S)

entitled

distribution, shop^ihg-on

mass

simply

must

masses

Number 5194

Authorised

Paid-up
Reserve

Capital
Capital

Fund

Members New York Stock

£4,562,500
£2,281,250

The Bank conducts every description

banking and exchange

Telephone: BArelay 7-8500

of

BeU Teletype—NY 1-1248-49

business.

Trusteeships and Executorships
also undertaken

Exchange

Members American Stock Exchange

120 BROADWAY, NEW YORK 5, N.

—.£3,675,000

(L.

A

Oibbs. Manager Tradine

Specialists in Bank St

Y

&

32

The Commercial and Financial Chronicle

(704)

better under

Continued from first page

our

done since

ever

American

own

system than

abandoned it

we

have

we

much of it under

or so

Thursday, February 12, 1953

.,.

lower

We See It

As

be well if

would

left

forefathers

our

those

men

of

a new

We

us.

think

baptism
that

it

light and leading who

understand the true inwardness of all this would to the

of their ability and energy inculcate and induce
confidence in true Americanism. The rank and file may
limit

need that sort of faith to resist the

return to

enticing palaver of the
semi-socialists of the New Deal and Fair Deal vintage
when reforms do not overnight perform miracles or when
those who have been living under the sheltering wing
of a paternalistic government have again to depend upon

in this "modern''

themselves.

sound

Americanism

deviations which

and

are on

in current discussions

'

faith

the

in

originating with the vested interest in largesse, is clearly
suggested in much of the current comment on the various
amoves
already made—comment in friendly as well as pro¬
fessionally opposing circles. Throughout much of this com¬
ment runs the notion, implied if not expressed, that it is

leadership of Franklin Roosevelt.
It seems to us that many of us need

not

trial.

we

New

Deal

and

Fair

Deal

Again and again and again

hear the refrain that all this

orthodoxy is certainly welcome—if it will work
complex society of ours. Again and again
and again we hear the timorous counsel that panaceas
and "emergency" programs which have never worked
ought to be kept on ice as it were just in case they are
needed

as

a

result of failure of the

common

sense

now

that the New Deal
well, and that they
were
being in some part (and only, unfortunately, in
some
part) discarded just for the Hell of it.
This type of attitude was well described in Washing¬
ton despatches over the past week-end. One of the writers
for the New York "Times" last Sunday, reflects "senti¬
ment" in Washington doubtless when he says:
"The domestic program President Eisenhower put
forward last week touched "directly on the pocketbook
nerve of the U. S. voter.
It bore down heavily on prob¬
lems in two areas, interrelated and interacting, that

being resorted to. One would suppose
and the Fair Deal had worked pretty

dominate the dollars and cents side of American life—

the U. S. economy and the U. S. budget.
"The U. S. economy is a fantastic complex—250,00(h
.

manufacturing enterprises,
5*400,000

farms

—

that

than 60,000,000 workers,
produces goods and services
more

measured in dolkr terms at around $2,300 per year per

capita. The government has reached into many avenues
of the nation's economic life—agriculture, resources de¬
velopment, finance, social welfare and now the intricate
processes of mobilization for defense and the manifold
controls that go with it.
"The U. S. budget is equally fantastic by the standards
a generation
ago. It is taking one dollar of every four
in the national income. It pays the salaries of 2,600,000
civilian employees and 3,600,000 in the armed forces.
Seven-eighths of it goes for wars of the past and present
and security against future war. It is deep in the red—
this year to the extent-of nearly $6 billion, or one-fourth
more than the whole
budget in Herbert Hoover's last full
year.

"Among President Eisenhower's firmest campaign
was a
broad-gauge pledge to 'free' the econ¬
omy by contracting the role of the government as far

consistent with the national welfare, and to ease the
taxpayer's burden through the strictest economy all
through the vast apparatus of government. In both areas

as

the Administration last week made

problems ahead,

as

beginnings, but the
the President himself acknowledged,

formidable."

Now

another writer for the New York
"Times,"
Joseph A. Loftus, speaking from Washington and appar¬
ently reflecting the views He had encountered there, says
in this same issue of this
leading newspaper:

"The President quite clearly

was aware that he was
chance on freedom, not offering guarantees; that
there are powerful forces in the
economy and delicate
balances, and perhaps the controls he was discarding
might have to be re-imposed at some later date.
'It is axiomatic,' he said, 'that our
economy is a highly
complex and sensitive mechanism. Hasty and ill-con¬
sidered action of any kind could
seriously upset the subtle
equation that encompasses debts, obligations, expendi¬
tures, defense demands.; deficits, taxes, and the general
^

result

of

production
great?
A

industries

become

By this very process.
contrary example

somewhat

be

may

found, perhaps, in the
industry. I understand

building

that great strides have been made
in this industry since the war,
but

there

ting

appear

of old

the

be

consumer

real

more

And

money.

to

at

least

practices, which
from

value

get¬

for

his

it still tends to be

so

boom-and-bust industry, sub¬
tracting from.- rather than adding
to our
economic stability,
con¬
tributing to periods of inflation*
a

Federal Reserve and Savings Banks
tended downward in the past, and
must recognize

we

strong forces pushing us
direction

now.

based

be

on

a

better division

of

and deflation.

are

the rewards of increased produc¬

in that

tivity than we have yet achieved.
During the past 50 years it is esti¬

loans

mated that the real national prod¬

estate mortgages, and particularly

that there

But I don't think

acquiescence is the indicated re¬
sponse for anyone, and particu¬
larly not for savings bankers.. The

uct

of

United

the

States

has

in¬

This has to do, of course, with
backbone of your business:

the

on

home

and

investments in real

mortgages.

I do not know

creased five-fold, while popula¬ whether the
savings banks have
protection which the public is of¬ tion doubled, so that output per ever taken an interest in or done
fered, by those who foresee and capita increased two and one-half anything about trying to see that
accept gradually rising prices, is times. Nor is that all. The greater the mortgage borrower gets value
investment
in
real
estate
and product per capita was achieved received for his money. * I am not
stocks and keeping savings bank with less effort, so that we have thinking
of value received in
been able to combine satisfaction terms of relative
accounts to a minimum.
prices .or costs
of our material wants and needs of similar
structures, but in terms
Yet, if the only alternative to with
greater
opportunities
for of what he might get for his
greater stability of the purchasing
education
and
relaxation
for money if all the possibilities of
power of the dollar is unnecessary
leisure and learning.
technological
improvement
and
—

defense

unemployment,

the

of

dollar may not be a

it

is

likely

to

popular cause;
have few leaders

That adjective,
attached to the
word unemployment might detain
us a little, if we had time, because
unnecessary
unemployment is
what

would

make

stable dollar

responsive

seem

to

defense

human

Let's by-pass this bit of

however,

of

callous and

a

un¬

suffering.

semantics,

put our problem
What we all should
be interested in trying to achieve
and maintain is a high level of
employment and production, with
provision for the relief of the
hardships of whatever transitional
and

another way.

Better Division of

Rewards and Increased

and few followers.

"unnecessary,"

materials

new

Lets Have

Productivity

the

The record is

a proud one even
the gains of the i>ast 50

though

were

exploited in

the building industry. If it is the
case
that restrictive practices in

building

trades,

restrictive

practices in the building materials

field, and archaic building codes
not distributed evenly still combine to give your bor¬
time, and even though some rowers less than their money's
of the gains were shot away in
worth, I should say it is of inter¬
two World Wars. But in the fu¬ est to
you and to your customers.
ture pex*haps we can do better. I know it is of
interest to those
Perhaps we cap avoid the extreme who are seeking a stable progres¬
ups and downs which are con¬ sive economy without extremes of
cealed in the averages of the past inflation or deflation.
half-century. One approach would
We have adopted as a national
be through a better division of
policy the promotion of home
years were
over

the

rewards of increased produc¬

tivity,

in

terms

of

keeping

our

ownership,

but

most

of

what

is

done to promote home ownership
is to make credit easier to obtain

economy dynamic while avoiding
of unemployment devel¬
the payment of tribute to pressure in terms of Government or Gov¬
from time to time, as a result
groups.
There were times in the ernment-guaranteed or
insured
of Hie free and dynamic character
past when the owners and man¬ loans, with
low interest rates,
of our economy.
agers of enterprises claimed and small down payments and long
But we are now told that to took more than was their due in
runs to maturity.
If there are re¬
have any chance of success in such the form of
profits. There were strictive practices in the building
an endeavor we shall have to jet¬
times when the farmer was on
industry, and if there are archaic
tison stable prices.
Here is the the short end of the stick and
building codes, we are making ft
way the argument goes in capsule times when he reaped where he easier for
people to go into debt,
form: It is the established policy had not sown. Now
organized la¬ while condoning their being given
of the country, and the only toler¬ bor has
achieved such strength less for their
money than they
able policy in terms of domestic, that it tends to claim the lion's
should receive.
This must be a
social
and
political
conditions, share of what increased produc¬ concern of the savings banks, as
amount

ops,

commitments

were

the

production, and the

broaden their
markets, they are
likely to lead to larger production
more
employment opportunities,
and better living for
people gen¬
erally. How did our great mass

prevent

13

are

vigorous competitive attempts of
producers
and
distributors
to

remnants

Continued from page

greater values a&

or

prices

efficient

more

the

prices

stable

taking

a

"

international

and

tionships, to
States

"Thus, whether the new philosophy will work is a
question. At any rate, a new policy has been declared and
the first step taken. The
policy is far from an attempt
to repeal the essential social elements of the New Deal
and the Fair Deal, but it is
plainly in the direction of
minimizing the interference of government with the

the

may

mild

For

believe the way to begin such es¬
sential changes as these is to
begin. We think it un¬
fortunate that such beginnings have to be made when
so many seem so timid and uncertain
about them, but
we are strongly of the
opinion that these and any other
changes which take us back toward the true Americanism
which has brought us to our present position of
strength
and good fortune should be started at the earliest moment.
our

part,

We have not the

we

slightest doubt that




we

shall fare much

rela¬

experience

as

certain

more

it

will

be

that

tivity produces. Too little atten¬ the source and center of much of
tion has been paid by these vari¬ our
mortgage lending. Would it
ous economic groups to the possi¬ not be
desirable, therefore, to take
bility

of

giving the

consumer—

that is, all of us—a little more of

steps,
to

or

to prod the Government

take steps, to see if these con¬

the rewards of increased produc¬ ditions
actually exist and, if so,
tivity in the form of lower prices what can be done about them to
or
of greater values for money
improve the position of the mort¬
spent. With ownership that em¬ gage borrower?
If private busi¬

prices will creep upward; the
price advances in good times will ploys navigators as well as cap¬ ness condones such
practices by
exceed the price declines in mild¬ tains of
industry, with more ma¬ acquiescence, or public officials
ly bad times. This upward move¬ ture leadership in a more mature connive in them
by inaction, we
ment of prices will come about labor
movement, and with Gov¬ are guilty of giving assistance to
chiefly because, at some point ernment that holds the scales in those who would undermine our
short of full employment, the bar¬

gaining

balance between management and

system of democratic capitalism,
labor, not tipping them for po¬ It is not necessary to descend to
able litical purposes, a great deal might the low level of a New York dock
faster be accomplished.
scandal in order to find a situa¬

power of most unions be¬

comes so

strong that they

to

up

push

money

are

wages

than the engineers and managers
I am assuming, of course, that
can increase output per man-hour.
conditions of vigorous competition
In other words, increasing labor
will be maintained, both to spur
costs

going to push

are

up

prices,

because powerful labor unions are
able to force wage increases in
of

excess

ity.

In

increases in productiv¬

these

the

utilization

of

our

dramatic

technological developments and to
for price re¬
duction or improved quality as
business searches for expanding

continue incentives

circumstances, ex¬
the money supply is markets.
/
only the vehicle, not the cause of
Those who hold the opposite
inflation, and credit policy
in
view are likely to fall back on the
realitv is made at the collective
argument that even if attainable,
bargaining table, not in the Fed¬
stable or declining prices are in¬
eral Reserve System.
imical to high level production
That is the way the record of
and employment. That, of course,
the past several years is being

pansion

natural economic laws."

economic

to it that what¬

are kept
possible. The more
successfully the country checks
depressions (keeping them mild)
as

,

economic health of the nation,

see

business recessions the United

ever

of

It may

be the realistic, hard-headed way
to view the future. There is an-

0tV»pt«
not be

w^v

hnwpvpr

which

wholly fanciful.

mav

It would

ter

a

instincts

denial of
and

of

our

our

performance.

bet¬
best
*

I should like to

see

the building

industry,

generally, improve its
production, standards; and then
give the consumer, the mortgage
borrower,
the home owner, a

larger

share

of

the

rewards

of

increased productivity in terms of
lower prices for well-built modest

homes, and for improvement of
or repairs to those homes.
Noth¬
ing would contribute more to the
promotion of economic

stability

the

the

or

de¬

clining prices have been and

can

the encouragement of saving.
This is supplementary to my

depends

projected into the future.

tion which is

on

the

reasons

behavior of prices.

be

for

Stable

accompanied by declining

duction

and

employment.

pro¬

prevention

of

inflation,

and

general theme but perhaps I have
enough to indicate that I

said

But if think

we

can

refuse to make the

Volume 177

Number 5194

♦

.

.

The Commercial and Financial Chronicle

.

'

•

(705)
intolerable choice between
essary

unnec¬

unemployment

and
per¬
I think the core
is to be found in

Continued from page 5

the

petual inflation.
of the

answer

increased productivity and
sharing of the product. I
we

must

refuse

advance

to

just

a

think

surrender

in

to

creeping
inflation
which destroys the habit and
re¬
wards of individual

ing.

But

if

dreams,

and

be

must

this

if

or

is

the

made

family

the

fatal

between

sav¬

stuff

of

choice

unneces¬

unemployment and persist¬
rising prices,
then
your

sary

ently

business

is

in

danger.

You

had

better

begin to look beyond the
you are making today to
the problems of
shrinkage or liq¬

records

uidation

which

your

successors

The State of Trade and

rate but
states

do

make

not

"Ward's"

a

choice, and it is

mental choice.
a

We

plump for
economy,
with a

propped-up

perpetual bias
toward
That might well

keep

high

a

level

of

employment
would

seeds

breakdown.

choice, the
an

phasizes

into

in

its

place

social
rate

productivity,

related

some

downs

<

stride,

those

fitting

economic

of

It is

economy

an

and

which

growth

permits.

and

ups

and

improvements
of

remarks,

economy which em¬

increased

taking

I have

one

tried to point up in these

is that of

and

considerable

a

eventual

an

going at

But, in my view,
within itself the

carry

of

The other

inflation.

us

production

for

period of time.
it

funda¬

a

can

the

productivity
which

asks value received from
manage¬
ment

and

eity

dweller;

implies

fulfill

a

profit

the

choice

an

shall

we

various

them

of

as

job. To
this

of

to

struggle
with

the

instability in

our

another

or

of

particular impor¬

This prescription is not

and

easy

a

ways

one

assumes

tance.

hold

have

of

causes

economy,

or

possibilities

variety

a

which

economy

clear

so

as

so

it

is

the

high road to real

economic stability.

growing shortages of certain types of
possible reasons for a decline.

Don't

worry about a general increase in steel
prices, says
"Steel," the w.eekly magazine of metalworking. It won't come with
though steel is in such strong demand
operating at capacity to fill orders.
.

Steel supply is catching up with
demand, adds this trade paper
and the steel
industry will not wish to embarrass an administration
which is working for a free
economy.
Some adjustments in steel
prices and a resumption of move¬
ment of prices can be
expected, this trade publication

points out,
adding, adjustments, most of them upward, will be needed to
cor¬
rect imbalances that have risen in a
rigid structure of prices under
government controls.
Then the resumption of movement of
prices,
up and down, in response to demand and
production costs will
tend to maintain balance
among prices.

Supporting the belief there wTill be no general increase in steel
prices is the growing cost consciousness of buyers.
Another evi¬
dence of that is
consumers

in the

Boston area where some
jobbers and
taking all of the large cold-finished bars
they

seen

not

are

entitled to for the second

are

quarter under government allotments.
Although large bars have been particularly insufficient in
supply,
these buyers turned down the
tonnage because it would have to
come from the
Pittsburgh district, and that would involve con¬
siderable freight charges, states this trade
weekly.
While

demand,

some

of the

major forms of finished steel are in strong
improvement in the balance between supply
is expected by three months from
now, a survey by

decided

a

and demand

"Steel" shows.

A substantial portion of the strong demand in
the
last several months has come from efforts of
consumers to rebuild
their steel inventories that were pulled down
by last summer's

strike of steelworkers.

That this rebuilding is pretty well
plished is revealed in "Steel's" survey. Majority of those

than 45 days'

strike

summer

suggests

there

were

more

supply on hand.

Most concerned
that

last

difficulty in obtaining the forms of steel
in strongest demand are small consumers and
automotive

are

over

suppliers, "Steel's"

survey indicates.
Small consumers feel they
enough weight to receive preferred treatment, and the

automotive suppliers are trying to
drive of the automobile industry.

The

A. M. Kidder & Go.

American

Iron

keep

with the production

Institute

announced

that

the

operating rate of steel companies having 93% of the
steelmaking
capacity for the entire industry will be at an average of
98.7% of
capacity for the week beginning Feb. 9, 1953, equivalent to
2,226,000 tons of ingots and steel for castings.
In the week starting
Feb. 2, the actual rate was
97.7% of capacity and output totaled
2,202,000

tons.

2,238,000

tons,

A

month

while

a

ago

year

actual

ago

actual output was 2,080,000 tons,

Electric

output

when
or

the

stood

capacity

at

99.3%,

was

smaller

100.1%.

at

8,129,038,000

kwh.,

according

to

the

Edison

.

'■

.

A.

J.

Corte*«

673,529,000 kwh., or 9.0% above the total output for the week ended
Feb. 9, 1952, and 1,171,754,000 kwh. in excess of the
output re¬
ported for the corresponding period two years ago.
'.

4

-

Commodity Price Index Holds

to

Steady Pace

a

The general price level held
fairly steady last week at slightly
below that of a week
ago.
The daily wholesale commodity price

index, compiled by Dun & Bradstreet, . Inc., closed at 278.07 on
Feb. 3, as compared with 279.32 a week
earlier, and with 306.25 at

this time

a

year ago.

Grain markets were irregular and unsettled
in the week witibElittle change in prices from the
preceding period.
'
.

A

fair

volume

of

export

business

developed

in

wheat

and

helped to sustain prices of that cereal.

Prospects for the winter wheat

crop in the Southwest con¬
tinued poor due to the lack of subsoil moisture.
Corn continued to*
pressure of continued marketings of CCC
stocks, a re¬
duction in the feeding
ratio, and the absence of

lag under

foreign interest.
Rye and oats declined in light trading.
Some scattered bookings of spring wheat
flours were noted
early last week as mills protected against price advances. Aside
from this, activity in the domestic flour market
continued in the
very cautious manner which has prevailed for some time.
Cocoa
prices were slightly easier as the result of
lagging manufacturer
demand. Warehouse stocks, totaling
70,936 bags, were down slightly
for the week, and compared with
96,121 bags a year earlier. Lard
continued lower, with loose lard
dipping to the lowest in 12 years.

There

was general weakness in all classes
of livestock at
Chicago,.
Cattle and hogs were off despite a substantial reduction
in receipts.
Lambs were more plentiful,
however, and values dropped to the
lowest January price in recent years.
Prices in the domestic cotton market continued to
move

irreg¬
ularly higher the past week. Supporting factors included moderate
price-fixing for domestic and export account and the continued
substantial

movement

of

the

staple

into

the

government

loan

program.

Export

inquiry

volume of sales

was

showed

some

reported.

The goods market

improvement

and

a

moderate

.

was more

active-, reflecting

better demand

a

for certain textile constructions.
Sales of cotton in
markets increased for the week and totaled
177,300

the ten spot
bales, against
159,500 the previous week, and 145,600 a year ago.
CCC loan entries during the week ended Jan. 23 were
reported
at
121,800 bales, as compared with 200,000 in the
preceding
week, Entries for the season through Jan. 23 totaled 1,561,400
bales,
as against 877,200 to the same date last
year.
Trading in the Boston wool market remained quiet except for

occasional odd lots of carpet wools and scoured woolen
wools and
same levels as a week
ago.

Following the sharp decline of last week, spot hide prices
higher to close about V2 cent above a week ago.
Big
packer sales of hides, however, dropped to less than half those of a
moved

week ago.

Trade Volume Shows Little

Change From Previous Week

The cities with declines in retail trade
during the period ended

Wednesday of last week were about as numerous as those with
However, those with year-to-year gains were in the over*whelming majority. Some large stores in Eastern cities failed ta
equal the levels of a year before, reflecting to a great extent, the
on

shift of shoppers to the suburbs.
Washington, D. C., was one of the
few cities with sales below a year ago.

Electric

'*•

The current total'was 21,496,000 kwh. below that of the
pre¬
ceding week when' output totaled 8,150,534,000 kwh.
It was

■

Wholesale

gains.

Output Declines in Latest Week

Institute.

r

a year ago, or a
drop of 7.3%.
index represents the sum total of the
price per pound'
of 31 foods in general use and
its chief function is to show the
general trend of food prices at the wholesale level.

or

The amount of electric energy distributed
by the electric light
and power industry for the week ended Feb.
7, 1953, was esti¬
mated

corresponding date

The

noils which moved at around the

Steel

and

pace

$6.61

the

accom¬

reporting
they have a 30- to 60-day supply. Some even have a 60- to 90,day supply even though only a 45-day
supply' is legal under gov¬
ernment controls.
Continued consumption of steel
during the

do not pack

A. J. Gorfese With

figure is only two cents above last year's low of
$6.11 on;
16, when the index hit the lowest point since
pre-Korea.
The high since the Korean
conflict started was $7.31 recorded on.
Feb. 20, 1951. This week's number
at $6.13, compares with
Dec.

say

steel

The total dollar volume of retail trade in the week
mated by Dun &
that of

a

esti¬

was

Bradstreet, Inc., to be from 1 to 5% higher than

year ago.

Regional estimates

varied from the comparable levels of a
by the following percentages: New England 0 to +4; East
—3 to -4-1; Midwest and Northwest
+1 to -j-5; South + 3 to -f7;
Southwest and Pacific Coast +4 to 4-8.
4
■
The buying of household goods continued to falter the
past
week but remained slightly higher than the level of a
year before.
Particularly popular were bedding, decorating materials, freezer*
year ago

...

.

A.

J;

Cortese has become

ciated with A.
1

Wall

members

Exchange,

of the
as

"Mr. -Cortese
Faroll

M. Kidder: &

Street,'* New

&

a

New

Harris

Co.,
City,

York Stock

and

Analyst.
formerly with
W,

& Co. in New York.'

-

York

Market

was

Co.

Hutton

E.
v

•

,

Car

asso¬

,;

*

Loadings Edge Slightly Lower in Latest Week

Loadings of revenue freight for the week ended Jan. 31, 1953,
totaled 697,616 cars, according to the Association of
American Rail¬
roads, representing

decrease of 25

below the preceding week.
decrease of 33,602 cars, or 4.6%
cars

The week's total represented a
below the corresponding week a
year

ago, but an increase of 46,451
7.1% above the corresponding week in 1951, when load¬
ings were reduced by a strike of railroad switchmen.
cars, or

United

Upham Adds

(Special to The Financial Chronicle)

a

States Auto

Output Holds to High Rate

In Past Week
,

and

clock-radios.

year ago

The interest: in television

but less pronounced than two

was

years

sharper than

before.

Trading activity in most of the nation's wholesale markets
sustained in the week
for the
*

new

The

selling

total

as

wasr

merchants went ahead with preparations

season.

dollar

a
-

-

;

.

volume

of

wholesale

orders

did

not

vary

markedly from the record level set a few weeks ago which was the
highest yet attained for this time of the year; it remained moder¬
ately above that of a year before.
'
Department store sales on a country-wide basis, as taken from
.

.WINSTON-SALEM,

N.

Herman C. Hedgepeth h^s become
affiliated with Harris, Upham &
Co., Pepper Building. Mr. Hedge¬
peth was previously with Thom¬
son

&

McKinnon for many years.

(Special to The Financial Chronicle)
—

tinued

at

a

car

production in the United States last week

•

con¬

high rate, according to "Ward's Automotive Reports."

It aggregated 117,478 cars
compared with 117,654 cars
previous week and 73,043 cars one year ago.

in the

(revised)

Total output for the past week was

made up of 117,478 cars
22,445 trucks built in the United States, against 117,654 cars and
23,483 trucks the previous week and 73,043 cars and 22,367 trucks
and

in the comparable 1952 week.

Joins Robert Baird
MILWAUKEE, Wis.

Passenger

C.—

John T.

Canadian plants turned out 7,423 cars and
1,835 trucks against
7,629 cars and 1,523 trucks in the prior week and 3,360 cars and
3,636 trucks in the comparable 1952 week.

Seaman, Jr. has joined the staff
of- Robert

W.

Baird

&

East Wisconsin Avenue.
man

Co.,

110

Mr. Sea¬

was

previously with Harris,
Upham & Co.




Business Failures Continue to Fall
Commercial and
the week ended

Feb.

industrial
5

Bradstreet, Inc., reports.

failures

dipped slightly to 159 in
in the preceding week, Dun &
Despite this decline, casualties exceeded

from

162

r,i

A general downward
movement in food prices last week car¬
ried the Dun & Bradstreet wholesale
food price index for Feb. 3 tat
$6.13, a decline of nine cents from $6.22 the week before.
The

•

•

death of price
controls, even
that the industry is

perpetual mild inflation, but I be¬

lieve

as

Output Scheduled at Slightly Higher Rate

two-months'

policy of

a

to

However, the big three makers—General Motors Corp.,
Chrys¬
ler Corp. and Ford Motor Co.—have an
ample supply of steel to
maintain steady auto output for some
time, this agency said.

healthy degree of effort

a

to make

in

labor, from farmer and

referred

steel and "labor unrest"

50% from the 318 recorded

were

current

the industry turned out 117,478
autos, about
the same as the
117,654 in the prior week but about 61% more
than the 73,043 made in the like 1952
week, "Ward's" added.

have to

we,

were

"Ward's Automotive Reports."

Steel

deny that

production last week rolled along at a high
appearing that a slower pace was in the works, 1

car

level, failures

Food Price Index Touches Lowest
Point in Seven Week&

money

In the past week

may face tomorrow.

I

signs

low the prewar
in 1339.

Industry

be pressed on the theory that steel is better than
bank, concludes "The Iron Age."

Automotive

which occurred in the
comparable week a year ago, al¬
were below the 1951 total of 191.
Continuing far be¬

though they

ment may

in the

134

33

the Federal

Reserve Board's index, for the week ended Jan.
31,
1953, increased 2% from the level of the preceding week.
In the
previous week an increase of 2% (revised) was reported from that
of the similar week of 1952. For the four weeks ended Jan.
31, 1953*
an increase of 1% was reported.
For the year 1952, department
store sales

registered

an

increase of 1% above 1951.

Retail trade volume in New York last week

volume for the like week

a

year ago,

dropping

an

again trailed the
estimated 8%.

According to the Federal Reserve Board's index department
store sales in New York City for the weekly period ended Jan.
31,
1953, showed no change from the like period of last year. In the
preceding week a decrease of 4% (revised) was reported from
that of the similar week of 1952, while for the four weeks ended
Jan. 31, 1953, a decrease of 4% was recorded.
For the year 1952,
volume declined 7% under the

preceding year.

34

-

Continued

The

sharp declines. By 1816 the
wholesale price level was lower
than it had been in 181*1. (1816—

132

in

the index had de¬
by 1868 and aver¬
84 in the early 70's.

1865,

97.7

to

aged

82

This

was

level

peak of

was a

to

about

prevailing

33%

above

the

just

before

the

Civil War.

the

when

1922

almost

cut

were

the 20's they
about 40%

Prices

May 1920,

was reached, to
wholesale
prices

peak

January

half.

in

During

remained at

level.

prewar

started, there has been a per¬
sistent rise in retail prices so that
at the end of 1952, the level was at
War

after

soon

havior

I.

after the

months

two

and

years

in November

Armistice

earlier

postwar
declines
precipitous.
There
slow or gradual de¬
those
stratospheric

quite
was

never

cline

a

from

Consumers'
ilar

trends

prices showed sim¬

magni¬
tude of the rise, and in turn the
subsequent decline was smaller
although

for wholesale

than shown

Thus,
after

World

prices

more

been

the

prices.

and * immediately

during

When

the

War

I,, consumers'

than doubled (106%).
post-1920 decline had

completed, consumers' prices

remained

70%

about

higher than

they had been before World War I.

be¬

II

and

preceding wars? Why did
fail to have a collapse in

we

prices? The main factors at work
may be highlighted by comparing
the experience during and after
World Wars I and II.
It will be recalled

nitude of the price
World

the

during

hostilities of

This development

II.

War

that the mag¬
rise was much

undoubtedly due to the com¬

was

prehensive anti-inflation program
effect during World War II.
The deferred inflation of World
War II
was
reflected in higher

in

During the
volume

90.6

63.5

105.9

6.4

26.5

114.2
27.9

When

tripled.

Price

II

Movements

1

The price experience during and
since the end of World War II has
been

marked

in

contrast

following the three earlier
From

1939

the

to

of

end

that

to

wars.

World

deferred

of

magnitude

the

de¬

World War

mands was smaller in

the total
deposits and

until

a

bined

and

war

120.2%

or

reached
The com¬

was

postwar rise

was

in line with the experi¬

during

ence

peak

(169.8).

after

and

previous

But here the similarity ends.
In the sixteen months from Au¬
wars.

1948 to December

1949, the
index fell steadily from 169.8 to
151.2 or a decline of 11%.
Con¬
gust

trast this modest adjustment with
the slash of almost 50%
in the
20-months
After

following

the

1948-49

wholesale
almost

price

double

World

May

decline,

the

remained

level

(96%)
level.

War II

1920.

the

pre-

Prior to the

start of the Korean-.

index

had

War, the price
rising gradually

been

for 6 months from

151.4

to

157.3.

To state it

differently, almost five
after V-J Day, the wholesale
price level was close to the post¬
war peak—more than
double the

years

level.

prewar

What has happened since June
1950? Under the impact of a wave
of

scare
buying
shortages prices

and

anticipated
sharply, By
March 1951, the wholesale price
index reached 184.0
(1926=100)
or

17%

level

and

level.
'

rose

above

the

138.7%

Since

pre-Korean

above

the

1939

Our total spending for

II.

World

restraints

the

on

The trends of retail prices have

1946,

War

U, the consumers' price index

war

1948

peak

was

when

The first post¬

reached in August

the

index

above the prewar level.




was

75%

reduc¬

ratio gradu¬

the

years,

rose

billion.

no

have

support

I

War

World

After

been created

inflation has
by deficit financing.

inflation

new

as

rise. Any objective analysis
of wage and social welfare costs
must conclude
that the total is
wages

the end of World War II

end

the

Of

1951, it-had increased

This
has not prevented sharp

program

agricultural prices above

rises in

but

price,

parity
restrict

declines

act to

it does

below the

new

output

tailed, the pressure

on

levels

is

Corporate

After

World War

85.3

155.8

70.5

Long-term

38.3

64.8

26.5

Short-term

Ind.

I there

and

Farm

Non-Corp

47.0

91.0

44.0

55.5

121.4

65.9

4.7'

6.3

1.6

27.9

69.5

41.6

Mortgage

Non-Farm

Other

Mortgage

Debts—

Farm

2.5

7.0

4.5

.20.5

38.7

18.3

140.8

277.2

136.4

»

Non-Farm

Grand

Total

Aonther

of Taxation:"
factor

important

tributing * tc, the

were

increases, but
they were not so large as during
the recent postwar period, and the
wage

labor unions did not have as much

hence" hold

jor

A

further

large

increase

took

place in -1952 so that currently, it
is probable that the total private
debt exceeds $300 billion.
Some
idea

of the

magnitude of the re¬

cent increase
is

is obtained when it

remembered that from

con¬

price

present

tem today

is

Thus,

for

taxes

in

country

declined

by

in

behavior

of

prices in both periods.

estimated

almost

1920 to

5%

increases; in

to

tend

be

very

that total wage
costs did remain unchanged then
the reduction in unit labor costs

of/rising
productivity
small—an average
of some 2% a year. But here we
have another problem. Under the
because

in

eluded

are

ingness on the part of some

charged.

In connection with pub¬

labor
Let

me

emphasize again that this
labor costs does hot

unit

in

rise

provide an absolute floor to any
potential decline in prices. How¬

utility and railroad rates, for ever, it is an important factor in
example, such taxes are specifi¬ long-term pricing. In any event,
cally included as costs and the? a large decline in selling prices
fair return is determined on an
under these conditions would have
after-taxes basis.
Similarly many a
catastrophic impact upon profits.
local property taxes are passed on
to the tenant and result in higher /
Impact of Price Decline on

lic

The

rents.

high

of govern¬

cost

element in the
high cost of living and* in the high
clearly is

cost of

level

rise in labor costs

The

present price level may be
from another point of

the

is

1951, the total

view. At the end of

underpinnings of the

price

present

,Savings and Life-insurance

.

examined

in Unit Labor Costs

Rise

Purchasing Power of Liquid

an

doing business.

One of the

sharp

during the past

13

liquid assets and life in¬

value of
surance

policies aggregated $513.6

billion.
Billions

Any evaluations of the outlook
price level must give

vate debt is bad.

crease

A modest which contributed to the- rise and

can

recent

rate

of

in¬

be maintained without'

causing serious problems;
Turnover

con¬

emphasis to the factors

the

However,.I doubt

While
has

been

the

of Deposits

with

the

in¬

and-'larger- budgetary

Deposits

89.2

Assets

$260.5

Total Liquid
Life

Insurance

Policies-_ 253.1

$513:6

Total
The

totals

end. of

1952 but final figures are

mind in*this connection.)

which

Secondly, f

not implying that

am

in the short

run-

that

or

wage

costs

the

are

basic determinant of selling prices;

it

Thirdly,
that

some

recognized

must, be
of

these

increases

unit labor costs may be
lower unit overhead

dition,

in

many

cost

^industries
also

raw
are

Finally, the full

of the ^ise in

costs may

offset by

costs. In ad¬

changes

important-

impact

in

unit labor

be avoided by the adop¬

can

greater at the

were

to

costs determine prices

15.8

Savings & Loan Assn
U. S. Gov't Securities

not yet available.

come

70.7
59.6

—

Deposits

Time

(Steel, coal, and railroads

very

,

Demand

deficits.

material

foregoing discussion

concerned

credit

$25.2

Currency

money,

in

and

labor

permit decreases in unit
costs as productivity rises.

leaders to

prices

the

extent" in

believe

sound basis of

a

determination for all com¬

wage

$23.7

nificant

not

panies,1 the attempts to adopt the
formula does indicate an unwill¬

price

consumers

at

this is

that

While I

increases.

wage

year

corporation

Direct

-

estimated

Motors

many' unions have
been
seeking so-called productivity

taxes
billion for
the
current
fiscal
year.
These
taxes
are
recovered
to
a
sig¬

index.

General

the

of

impetus

These taxes are in*-

the

very

plan,

billion or
consumption

total

be

must

$9.8

at

of

expenditures.

1929 (for,- example,, and
stock market speculation was im¬
day

whether

Factors Contributing to Price Rise

for the

upward.
annual

Similarly,

excise

fiscal

current

on

differences

siderable

question. Here, too, all the

of the

ma¬

a

total

example,
the

between the nature of the debt to¬

this

out

rates generally seems

in wage

power.

example, total government spend¬

in

portance. And the end is not yet
in sight. Any significant reduction

this taxation is re¬
in the general price level.

flected

are

inflation,

down

years.
Let me make several
Our price sys¬ 1929, the total private debt rose points clehr before I indicate the
Nonhigher labor cost by $55.7 billion or 52.6%.
magnitude 'of these changes. I do
farm
mortgage debt rose from
stilts than ever before in our his¬
not mean to imply that the rise
tory—and it is difficult to visual¬ $27.9 billion at the end of 1945 to in labor costs has been the pri¬
$69.5
billion
at
the
end
of
1951.
ize our being able to come off
mary factor in the price inflation
these
stilts.
Breakeven
points Currently, the total, probably ex-« we have experienced. Wages as
ceeds $75 billion.
have been raised to new high lev¬
well as prices have risen because
During the past three years, pri¬
els in many industries.
of
the
inflation;' in money and
vate debt expansion has financed
credit. In some instances, however,
Finally, after World War I, the
more than
12% of the total con¬
the increases in wages and prices
world
disarmed
much
more
sumer and business spending; the
have contributed to the basic- in¬
quickly, while this time arma¬
proportion
in
1929 was
5.4%.,
ments expenditures were still be¬
flation because they have neces¬
There are significant differences
ing made on a vast scale.
For
sitated the issuance of more

economic

increasing in im¬

industry are still

of

part

ment

cur¬

prices is

reduced.

susbtantial

«Inc.

1951

(billions of dollars)

price support or loan programs.
Moreover, if prices decline be¬
cause
of surpluses, crop restric¬
tions are introduced and to the
that

Debt

Private

of

extent

billion.

$277.2

to
in

to increase than
Social welfare plans

likely

more

productivity

"

have

may

than

ductivity to a greater extent

fiscal inflation

no

was

Record Ifigfi Level

agricul¬

for

prices

ture; we have them today.

costs and by

modest. Assuming

Postwar Private Debt Creations

■

didn't

we

cutting wages or social wel¬
increasing pro¬

is by

during this period.

new

1945

;

„

years?

few

fare

During the postwar years,

therefore,
Such

there

that

the

Two ways. in
which these costs may be reduced

to price inflation. It will be recalled

30, 1952, the Federal budget
actually was in the black by $3.8

spent

we

By the end of World

had risen only 33.

this

to

During the early

significant re¬

any

this cost factor in

in

pressures are

July,

from

period

The details of
I, including war debts, was
less than $35 billion. In 1943, 1944 this doubling of private debt are
and 1945,we spent more than that shown in the following tabulation:
amount every five months.
Dur¬

the

been similar.

duction
next

contributed

be

will

there

•

that

probability

the

is

the

declined

Korea.

'

21.4

mos.).-—

Allowing

these costs, the

Wh^t

until in 1948 it was again
about the prewar level.
These

at

date, the index
five-sixths from the World War I
gradually sd that
portant in 1929). Nevertheless,*Tt
currently.it is about 10% above peak. After World War II the de¬
cline was only about 60%.
This is doubtful whether the volume of
the June 1950 level. Thus, some
was
a
major difference between business activity and the price
seven .* and" a
half
years
have
the two periods.
elapsed since the end of World
level' would have been as high in
War II and no collapse in whole¬
In other words, the qualitative
recent years if private debt had
sale prices has yet developed; five and quantitative differences be¬
been incurred at a more moderate
years of this period had elapsed tween World Wars I and II have
before the new war broke out in been so significant as to explain rate. I do not mean that all pri¬
has

21.7

"Federal Reserve Bulletin."

postwar
ally

June

to

War

ing

that

18.7

______

programs.

overall rise' in
unit labor costs since 1939 is prob¬
ably about 80%.
-

20.3

tion in turnover.

the recent conflict.
magnitude of the inflation there has been a record expansion
in World War I was considerably in private debt.
The total at the
smaller than it was in World War •end of 1945 was $140.8 billion; by

approximately $300 billion.

war

for

19.4

decrease.

I.than during

ing the recent conflict,

in August 1948

rious welfare

19.2

68%

prices and wages were removed at data suggest that as between 1939
the end of the war, the inflation and
1948, when the first postwar
built into
our
economy
during
peak in prices was reached, ve¬
the
war
years was
quickly re¬ locity was a neutral factor. Rising
flected in higher prices.
velocity played an important role,
It is important to note that in
however,
during
the
1950-1952'

Since

37.1%.
the

ployer-financed pensions and va¬

18.0

Govt.

and

Interbank

developed has been in the private- leyel, is ..the record high level of
prices after the war.
The magnitude of the change¬ sector of the economy rather than taxation.
While higher taxes can
in the Federal budget.
over to a war economy and hence
siphon off purchasing power and

War II wholesale prices rose only

(From 77.1 to 105.7; 1926
=
100.)
The rise continued after

16.5

unit

about

1945, the turnover ratio was
as
compared
with 19.4 in
1939.
The various wartime con¬

The

Post-World War

16.1

140%. These data suggest
labor costs have risen
since 1939. However,
these data do not show the entire
record. Labor costs also have risen
because of the adoption of em¬

Deposits,

16.1

in circulation more than

currency

the comprehensive index
published by the Federal
Reserve Bank of New York-has
risen by

1952 (11

years,

war

whole,

a

of wages

In

16.3

32.5

demand

of

years

'

Source:

trols

the

for

ratio

postwar

Demand

1951

.

of Govt.

Securities
Demand Deposits

price

War

World

after

smaller

heights.

in

differences

turnover

1939

64.4

26.1

17.2

—

Currency in Circulation

account

factors

What

Loans

Bank Holding

Wars

II

and

I

the

peak 18 months after World War
Three

Bank

I.

during and after World War

the
the

as

economy

product per mhnhour—
productivity—has risen by about
43% since 1939. During this same

that

Except

June,

bonds
increase in

an

the

For

banks outside of New

of

Turnover

by the sale of government

bry

and

story.

York City.

peak, some 91% above the supply of currency. Here is
It will be noted the basic source of the wartime
despite the postwar and Ko¬ and
early postwar inflation
in
rean developments, the rise in the
prices.
consumers
1939
1945
1952
price index has been
(billions of dollars)
somewhat less than the 106% rise

sharp

were

1939

for

1946, the Federal Government had
a
budgetary deficit of $211 bil¬
lion. This deficit was met in part
to the banks and

119954470865

vices.

con¬

period,

shows

ulation

saving de¬

various labor

of

tion

12, 1953

Thursday, February

.

.

private

level.

1939

ending of the War of 1812 and the
Civil War.
They reached their

these

until

1940,

July,

.

The ve¬
locity or turnover of deposits also
is important. The following tab¬

World War II Deficit Finance
From

money

factors

the

of the

part

its postwar

the

Differences—Post-World

1918, the postwar price deflation
had been completed.
Moreover,
V >

the
Since the Korean

prices were about 70% above

of

volume

and

tributing to that increase, this is

in labor costs in recent years.

rise

level

a

above prewar.

declined

after the

5% took place
months with the

budgetary

credit

and

that

War I—From

World

for leading

the

point reached in February
By June 1950, consumers

low

1950.

1035; 1811—104.9.)
Civil War—There

credit resulting from
deficits of World
War II, the postwar expansion in
private credit, the record high
level of taxation, and the sharp
and

money

decline of less than
in the following

the

only

probability

their

Long-Teim Outlook
For Commodity Prices

in

crease

of a reversal in
significance.
The current
level of prices reflects the com¬
bination
of
the
sharp
rise
in
the

from first page

very

clined

Chronicle

The Commercial and Financial

(7C6)

1

The point with

concerned,- however,

am

be demonstrated by using

1951 data. What would
the

the

happen, to

of

purchasing L power

this

$513.6 billion, if prices should re¬
turn to

the 1945 level? The meas¬

urement can be made in terms

retail

prices

and

wholesale prices. A

in

terms

-

1

See

Jules

end

would necessitate

Backman,

of Annual Improvement

The Economics
Factor Wage In~

New York University
Business, 1952, 72 pp.

creases,

of

return to the

price level prevailing at the
of World War II

of

School) of

Volume 177

Number 5194

.

.

The Commercial and Financial Chronicle

.

(707)
decrease

a

30%

in

the

price index and

sumers

<5f

of

37.4%

in

the

Dollars (billions) 1939 to 1951
Total in Constant Dollars

decrease

a

wholesale

price

1948

index.
Assuming that there were no
hccompaiiying reduction in the
total

volume of

liquid assets and

life insurance, the increase in real

purchasing

of

power
would be

billion

$513.6
billion in

terms of retail prices and $307 bilUon in terms of wholesale prices,
If the

analysis is confined to the
total liquid assets of $260.5
billion,
.

the

increase

in

would

power

terms

of

billion

real

be

retail

in

purchasing

$110

billion

prices

terms

and

of

wholesale

i

To

differently,
that

mean

the

of

mand

perfectly

amounts.

enormous

137.7

74.7,

74.6

146.2

85.4

81.2

150.4

181.0

233.4

lq44

195.9

155.8

289.8

"

227.5

176.9

330.7

1Q4g

"

231.5

165.9

294.2

237.2

148.6

238.8

138.9

250.2

145.5

242.7

140.4

some

of

out

mysterious

liquid

assets

economy in
while

purchasing
power
atthe production of goods

and

services

made

to

if

attempt

an

unchanged

manner—and

we

spent it

Accompanied by a decrease rather
than an increase in the volume of
production. The fact is that
not

we

liquid

required

increase

to

vaiidate

Is

do

theii

in

f

*

t?

of

not
*

...

i

liquid

4ti

.

i

will

assets

4

rush

to

if

am

,

goods and servdecline sharply. I

prices

fully

of

aware

the

-.

to

is drawn if one can vissharp, decline in our pres-...

While

I

^

'

11

i

the 1945 price level

i

..

-

-

TTT

"

T

However,

"i

present

assume

volume

major

a

to

of

liquid

be increased in

can

decline

confuse

-price
and

money

in

by

is

effect.

the

credit

assets

prices

level

measure

thp
the

real value

and

cause

present

large

to

The

Federal
most

either
or

also

led

due

budgetary

largely to the

deficits

of

alwar

vears

The

fiauid

assets during the 1939-1945

rise

of

$158

billion

in

period mav be contrasted with a
rise of
01 onlv
in the
fol°my $33 billion
011 10n m
me 101
Sinrp

six

lareelv

because

hi id get a

inrrpa^r!
of

deficits

rv
J

°

be

1945-to~1951.

years,

thf^P lirniid

government

thev
!

reversed

by

*

.

nnlv

can

J

.

budgetary

sur¬

pluses of comparable magnitudeand

the

visibility

is

low

in

that

-

The
L:.

7

table

!

,

below

from

1939

.

.

1951

and

of

power

ac-

years

real

those assets
.

,

of consumers prices and

wholesale
1951

prices.

From

1939

to

total

liquid assets rose by
277% in current dollars. When allowance

is

change, the

made

•

increase

Was about 100%

for

are
e

the

Pri^

in real dollars

in terms of retail

prices and only 65%
Prices
p
es

if wholesale

used
tn measure
measure the
u
ed to

in
in-

flation. In real terms, the total

currently
of the
.

.

more

1945.

lower

than

at

the

is

end

since retail prices and

war
1

wholesale

.
A

prices

.

have

.

.

risen

much

than total liquid assets since
This

development

in

my

judgment inevitably follows from
the large inflation present in
economic

credit.

system.

'




our

99.4

expected.

underlying

Psychqlogical factors have

"

has

con-

levels

increase

'

extent

in

be-

debt, I would anticipate

103.1

171.9

increase

price

at

the

rate

nnniinllxr

A

annually.
would

such

pany

some

of

««

business

probably

re-

accom¬

curtailment

a

index

annual

has

time

a

been

and

when

in

1

n

"

w\

business

M

1

J

__

_

after

J

the

1

.

v*

1 *

three

in

index

wars

re-

<ho

?vaqnlio/l ol fl-,« on/1
the inverted
V"reached, at the end
the war or

shortly.' thereafter,

The

peak price level did not

vail

in

the economy for

and

price

the

inverted
the

V

shaped

nnst.war

t

'

,

„

in

p

&

T

mnmpntum

important

not

was

nprind

prices will decline

eiibcitantiallv ^ince the

{

,

,

.

the

ma2nitude of the budeet

e

arcomn/nv"
mbnev^nd c^t
inllatmninm^ey and ci edit vvere
and

the

period

[pi time. Prices
the curve and then
Pi'omplly- down.
The
did not^become adjusted

<Tlarched

up
t

economy

to

sig-

the

peak

pri^e level because

represented^
monetary level
which
reflected
the
momentum

the

were

low

carried

In

our

prices

too

experience

1950, we have
illustration on

h|d
a.

•

in the cost

of

uTd'^evelopfln In Armament
economy.

Korean

Under |he impact of the
War-^and its
uncertain

magnitude,

setisi|ive prices rose
By February 1951, the

sh^P^-

rige ba(4 equaReR 59%.
This was
far beyond any rise warranted by
any new

-inflation"generated

up

to

that date
came

would

or sinpq»then. As it beclear,that.the Korean War

Price

level

would

settle

on

plateau higher than the 40%
t4- L

_l

^

a

«

41

iu

a

rise
^4

reflected in the prices of the posta

m

a

nf

the lalp
ic
of the
late '30s. Thic
This fneter
factor, tnn
too, is
of considerable importance.

Efforts

services,

would

doubt that it
whnipcnip

act

as

over

th£

short-term, these

prices began_to decline. Currently,
50%~ rise from June
reversed.
more

at

Sensitive prices
the

Jun^ 1950

are once

level.

A

three

time

inf>

thp,

state

it

s^t(r

tn

wnniri

fail

cio-

the level prevail-

hpoinniniy

nf

differentlV

iQ5o

the

^1' ^'

Tn

outside

Lowlt

to any decline

in wholesale

?1947S 4Q-lOO^a^com^nred with
We? nf ahmft nnTnri
Drewa? level of 50 inis is
not
a piewai level ol 5U. Thil
is not

the

rent

rm

will

orefhst
that levels.
prices
those

decline

Rather, it

to

is

estimate

my

the

of

lCG^Pl GSlQCllt

V

Compan>,

to

determine

mechani-

are

fraught'with^"many"perils'a'nd

n

4- L

r>

4-

44-

W

*7-511

V*

a4

11'nA

tjon that it will not
tion

needle

to

use

all

cure

4- Vk

5

a

w

Inc

that

of

the

fundamental

causes

of

price inflation will be neutralized,
this

connection,

is

too,

the

emphasis given

to full employby a lack of ade- ment. The political view in recent
it is"?n- years has been that unemployment
teresting to note that if the rise must be avoided or minimized rehindered

.

.

are

...

_

^

—*

quite d'ata?"^Nevertheless,

,in demand deposits plus currency
.

,

,.

»

,n-n

gardless

that

period, then

a

rise of about

of

the

cost.

Unfortu-

nately, the most palatable method

convinced that continued full

If, in addition,

lowance is

made for the

in

crease

velocity, the

.

bpcome

an

al-

10%

in-

indicated

q±%

94%.

come

ures.

Let
r

me

...

factors whlch

significance
mates

repeat

-

of

based

Nevertheless,

such

on

level probably will result in

ing

that

these

actions

successful;

there

30s will be recalled in this

are

nection.

m,n,mlze the
esti-

interest-

such

rise

in

retail

prices has been

actions

I

ecutive

Sumner

North

Vincent W. Howard

will

consider to

be

an

have fe-

what

inevitable

they
rise

f

Mr.

Howard

has

been

"active
i

banking

field

Following

for

A1£.u

Wcm

II

he

in

nve s

years.

md,ny

return

the

tment

many

"J1

his

"nme"t, service

from

gov-

du/in? W°T'd
associated with

was

Hayden, Stone & Co.

He also

was

President of Howard & Robbins,
Jnc

North
American
Acceptance
Corporation
operates
12
small
loan offices in five states,

Geo. F. Breen Offers
Vt. Industries Slock
T An

offering of 60,000 shares of
Vermont Industries Inc
Vermont industries, inc., common
common.

stock (par $1)

is

speculation"

a

being made

at

$5

as

share

per

through George F. Breen of New
City.
,■
;

York

Vermont

Industries

was

or¬

ganized in Vermont on July 7,
1952. Its business will be divided

ir}to three primary divisions: L»°ggiug- sawmill operation and wood

products

of the
to

manufacturing,

«n'oon°ewic
f.?;1??
60,000 shares will

acquire

all

of

the

Vermont

Central

be used

assets

Forestry

of

Co.,

Iny Thurston Valley^ Manufac-

turing
Co.; and the assets held
"
under contract by Harry Ginsberg
(President of Vermont Industries,

Inc.).

With Wagenseller Durst
(Soecip.l

LOS
liam

to The

Financial Chronicle)

ANGELES, Calif.

B.

Beggs

has

—

South

62g

me"uers

Wil¬

af¬
& Durst,

become

filiated with Wagenseller

Spring

Street

0f the Los Angeles Stock

Fvphan0„

Exchange.
With Waldron & Co.

con-

notably Pro-

to

o

Ameri¬

can.

(Special to The Financial Chronicle)

LOS

W.

Slichter,

Vice-

President

be

'

Some economists,
fessbr

announced

Randolph
Fernon, ex¬

C.

create new additions to the infia-

tion.

Ameri¬

Accept¬
Corpora¬

b y

the experience of the

But

*nS and intriguing figures because signed themselves
the

re-

will

these fig-

crude

ma-

imply-

a

...

are

a

.lor action by government to
Any verse tbe trend. I am not

inadequate data.

these

sharp decline in
economic activity and in the price
event,

any

Anv

change in velocity could have
considerable impact on

in

Directors

tion
(Bryn
Mawr, Pa.)

em-

Mlaton^needTe4

75% in lhe P"Ce leVeI WOuld be shltsTromThe
indicated.

f

ance

the pledge is still to be kept.
In

,

J. G. WilllG £1X1(1

Ol

o£ New York city,
to
the Board
North

the inflaills

The

—

can

-4-1»~»

develop in our economy. To the
evfenl
i<3
kent
extent that-.thic
that-this nledtfe
pledge is
kept,
one

was

wars.

Pa.

o

-

The Eisenhower- Adminishas given every
indica-

tration
4- i

will

it

Howard Director

I

lowest level to be expected; if a

decline should take place.

prices.

will

V

as

earlier

Philadelphia,

a

be expected that

can

rivip^c

2&SS!!
nificantly below

cally an appropriate price level to
reflect an enlarged money supply

probabiy- remain localized, many

at least

inverted

this

of public-

ln circldation from 1939 to 19o2 ^as heen more government
spendsince June is adiusted for the approximate ing> There are many careful stuinteresting doubling of physical output during dents of our economy who are
scale

the

even

high.

an
small

the

completed

after

it

as

beginning of 1950

a

World War L-Prom 1915 to 1920,
the total amount of demand dePpsits and currency in circulation
about doubled as compared, with

*.

that

that

expect
ke

consumers'

wilL-bewas

above

fluctuate above that level. I do not

to the next few

if

nlateaii

Prices

level

prewar

at

partial offset to any larger declines in other retail prices; I also

.

f

,

defidts

index

in rents and

evidence from these

nf

doubt

outlook

new

a

was

at the

was

public

movement df prices. I doubt if the

f

I

utility

no

experience

pre-

any

the

of

therefore

which is at least 75 to 100 <7

a/4 Avn+A

years,

term

have established

we

I

aoolicv

level

nrices

to be

was

veals the inverted V-like shape of war '20s. Similarly, the rise this
the price index—with the apex of time was from the depressed level

of

"lone

the

POmmnditv

though this would require a deof the long de*-,crease of only 11%. A further rise

raising rents

of

i-i

earlier

t

and

increases out
nrice

government

Loolurfe ahead

a

American

accent

waee

rising

the

investment

significant shif^in anticipations,
f ^ th^ War II. On this basis
^ Witlyn -the
ffu cf
pncest:adv„anpf
Rehabilitation;'!) t o g r a m s after lnS World ^0re}^nnirif^
framework
of
the
World War I helped to delay the alone there would be some expec- present defense program I anticidate of the shift in attitudes to tation that the post World War II pate
no
significant
change
in
_

Aq
fnr

that

moderate.

as

default

fixed incomes.

on

new

a

192°- In any event, an examination of the experience
during and

by

workers

lone

navs

steadilv

$30-$35

Knnir.nnn

A

will

which
a

re¬

debt, particularly if it occurred
the

accept

private

versal of past trends. Private debt
cannot be expected to continue to

109.5

arv

importer,The anticipation
of more and;more inflation inevitably had its impact on prices,
They rose sharply. But with the
end of the war, there was usually

"

of

170.2

Jan.1953_

data

and

because

*"

the

unthTnkable thlt

is

believe

public

level

99.2

billion

Urn"ih»
In the indicates that

money

result

boom-boom

of

cession

There is

conditions

at

cause

utility prices.

been

■.T?i-' -marched

the

,

terms

the

liquid assets by

to

purchasing
in

shows

,

tual level of

be

Federal

business, activity

185.6

lays

mafor pn"eTechno

inflation? in

nificant

direction.

to

by

the

that

tinued

i935-39—ioo

170 to 190 (1935-39
compared with 99.4 in
1939 and 128.6,in 1945. Some de-

undamental

er

would

189.7

=100)

of comprehensive
antiinflation programs in the past,
prices rose sharply and to much
higher levels thaif were warranted

in

which

is

ot

a

no

the

these lower taxes. To the

ranged from

absence

in

$200 billion during the

lowing

is

why

or

reflects

$69 0 billion in 1939 to $227 5 bilwas

was

inflation

to the large rise in -liquid assets,
Thus, the rise in liquid assets from
lion in 1945

e

a

128.6

"r

reason
ihat
that

awnime

program

will be offset in
part by a further
in local taxes. In
any event,
I do not anticipate that
any major
corrective
to
the
present
price

The consumers' price, index has

large scale the apparent in-- War II
in purchasing power in¬
Role of Momentum in Past
evitably would renew the pressure
for price' increases and result in
Collapses |ji Prices
a rise in prices to a considerably
mhAr.
,-c,WAiHor
tn

at

lim-

if nrices

when money wages

as

It

must

narrow

rise

can

retired

not

rise

Prices

date

weU

should

emphati-

effort

fuifher increasel

waees

savers

171.9

the 1945 level.

a

T/Z"

armament

relief

114.8

trip

a

crease

higher level.

any

68.8

to

as

be

Everv

costs within

increase
we

price

pLS-/

defeaUst

a

must

t0 hold

Real

e*

alSO>T
POlie7wUMch robTke^substance ol
signifi-

ot

104.4

siich assets will remain substan-* not have a 'price decline of the
tlally undisturbed. I merely am magnitude of .y,those which fol- layed rise in this
rioting that any attempt to spend lowed the wars preceding World expected because
on

But

111.6

1948

de-

long

very

small amount of tax relief
may be
possible over the next few years.

1952___<__

.Fjrom

not prob-

was

a

its

do

present

1951______

_

which

callv reiected

is fall

for

pressure

spending also
between 99.2 and 114.8 (1947-49 were declining. However, I would
—100) or about double the pre- expect such a recession and the
war level and 50% higher than accompanying price decline to be

describe

can

while the latter

'

50.1

inevitable

in

nroductTvitv wIth

.increases. This is

?eduff
unit labOT/°stsothers'living
the 01,.in
framework
of
the

mild in-

Prices

national out-

Within

Consumers

1947-49=400

the

inrrpa<?#>c

wage

of gains in

be

probability

requires

likelihood

level

wholesale

wholesale

able. I am convinced that from
that-the present, price level we will

fact

{he
the

receive

or by a sub- in labor

in

former

remote

little

.

1_

convert them into

ices

a

be-

and about 5%
was

The

velopment

.

1950

out

i

out

ualize

;

purchasing

conclusion,

in

of about 10%

years.

1949...

this pipe
dream, I cannot buy it. Throughthe
postwar period I have
been convinced.,-j^iat a return to

suggesting that holders

i

one

very

move

1948

had assumed. This

we

inevitable

which

"

(Aine of the magnitude postulated,
am

the

jgfeater

erd price level.

purchasing power of
liquid assets attending a price deI

than

power

have available the goods and

services

assets

program

the

for five

on goods newly/ would all be better off
by having
Paradoxically, such a: larger quantities of liquid assets
prices probably would be and lower prices to give those

in

not

budgetary surpluses
put.

present

1 iever*8£

stantial expansion

compre-

deed by any past standards. The
fact is that prices have remained
close to the peak postwar levels

produced.
fall

not

was

™ consumers' prices

in our liquid assets. Then
prices would fall—again in some

mysterious

war

wholesale prices

ln

crease

were

a

The 1948-49 decline

would

tending

a

gasaja&wasaa

to

cess

are still present m OSophy

The wartime infia-

economy.

h°H ,T

^eed .for a substantial correction
ln Pfice levels was not present,

is

manner

But

our

whirh rW#»i
which,
devel-

prLrdfd
did
sharply
flecf the6uifderlvYnTIf
lTinn
underlying inflation,

226.9

remain

war
war—reflect-

absence of

pnces

tained?

created

19430

during

this inflation
our

have moved the retail
price level

rifwf ab°ve prewar

of
ol the
the

of inflation which

did°rise T° and wholesale prices 122%

Prkes

momentum
momentum

the

in

llect

find that

we

end
end

end o£ The basic force

parallel

hensive | anti-inflation

then we will
truly have found the
these goods be ob- economic
fountain of youth. The
Available inventories- desirable economic
policy would
could
not
satisfy this huge in- then be very clear. To
improve
grease in purchasing power except
our
e co nom
ig well being we
to a minor extent. And it would should have
large budget deficits.
have
to
compete
with
newly These would result in a large in-

where

of
ot

ops

246.1

245.0

past

no

during ?h1erwt1 HowenveCrrealhe

228.7

142.8

260.5

___

„,°Z ^e"eme s-ince the

tvne
type

r c—
suggest?

.What does this
survey

World War II provides

•

243.0

s—

use.

Sterthe
atter the

99.7

126.4

1Q4C-

inai

ments^f^he

156.4

squeezed

goods and services by

over

69.4

116.2

If

liquid assets and life insurance
policies would increase their com-

Dollars)

:q4*

1950____

these

holders

Dollars)

oi

:q4o

1951_

it

state

Prices

(1947-49

•

aaessssatt

Wholesale

Prices

69.0
—-

sr»s s

(1935-39
Actual

.

1Q47

in

$156

prices.

figures

Consumers

r?*:

.

the

$217

35

Liquid Assets—Actual and Real

con¬

ANGELES,

Lynch

Calif.—James

has rejoined

the staff

of Waldron & Co. of San Francisco. He has recently been associated
Hills.

with

Bisno

of

Beverly
,

•

36

The Commercial and

(708)

Continued from page

fact that the steel strike last year

3

caused

a

;

Financial Chronicle

maliy

—

frantically
buying

buying

is

and

down

ittled

been

expenditure today, in
physical terms and on a per capita
basis, is actually lower than it was

Residential building.

the

before

started.

affair

Korean

The per

capita physical consump¬
tion of goods today in this country
is just about the same as it was
in
1949,- which was a recession
year, and it is below what it was
about five years ago. There is no
"boom" in consumption expendi¬
at

States

United

the

in

tures

this moment, and

consumption ex¬
penditures account for about 60%
of the total gross national product
of
the
country.
If there is no
"boom" in consumption expendi¬
tures today,

it

there

low

seems

is

to me to fol¬
be

to

reason

no

greatly afraid of a serious reces¬
sion in that part of the economy.
As

far

the

as

level

consumer

concerned, I make bold to
the

is

that
year,of

say

1953 will be a
stability.
The consumer
the economy will provide a

year

relative

side of

wheel

balance

great
^teess

the

in

That stability

picture.

busion

the

side will prevail regard¬

consumer

less of what may

happen in other

parts of the economy.
In

Boom
•

We had

dential

there

a

Building

great "boom" in resi¬

building. In

were

about

single

a

year,

1,500,000 hous¬

Since

then, we have
little over one
million, possibly a million to a
million one, as the current rate of
housing starts. I think of a million
to a million one as a reasonably
ing

starts.

dropped down to

a

'

nearly as
of capital

one can

fourth

quarter of 1953 might see
building materials

the demand for

appliances.

I

inite

decisions.

wrong

from

turn

the

business ques¬

40%

it

have

taneously

I

think

that

There

the

in

simul-

next

foul!

Administration,

new

should

an<|

-

that is the only
will work in the

States

of the

it

have

and

and

relief

tax

be

timidity

no

oh

question. Timidity will bring
repercussions in the next fouj

this
sad

years.

regard to ouf
policy—it is all written
down in the copybook. It is clear,
me, therefore, that any discussion
of the economic outlook at this It is specific. It has been, tried out;
Gentlemen, with

financial

well pre¬
change of moment has to come to grips with It has worked. We do not have
For this pur¬ to strain our brains to think up
pace in the field of capital expen¬ the financial side.
ing 40% of the
total economy.
ditures.
The steel industry is a pose, I should like to draw from some new way of going about it,
What is in that 40%? Technically
cross-section of defense spending the history book a guide, and the It is all there. All we have to do
we say durable goods.
More pop¬
and capital spending.
I comment part of the history book that I is follow the book and the rewards
ularly we mean capital goods—
draw from is the part that was will then be added unto us.
on steel with some fear and trem¬
the hard lines of merchandise that
People say to me, "What do yoq
bling because there may be some written around the personality of
go into new capacity, moderniza¬
local steel authorities here today a great citizen of Pittsburgh, An¬ think the election meant?" I say*
tion of old plant and equipment,
What did Mr. "I think the election mean less
who
disagree with me.
In the drew W. Mellon,
all kinds of effort to improve pro¬
taxes and less controls.". Specif¬
year just ended, the steel industry Mellon do on the financial side?
duction, cheapen production and
ically, it means , the end of the
reduce
unit cost
of production. produced about 93 million tons of
The Mellon Prototype
great bulk of price controls and
In 1953, I think the
There a "boom" truly does exist. ingot steel.
Starting roughly 30 years ago, the so-called wage controls as of
This is a "boom" mainly in the industry, barring strike, will I pro¬
duce
more
than the 93 million he funded the debt and he com¬ April 30. It should mean the end
physical sense of the term, a
bal¬ of the excess profits tax as of Junes
tons of last year. How much more bined tax reduction with a
"boom" which reflects first of all
is difficult to say, but I am in¬ anced budget. That is all we have 30. It means that or else this great
defense expenditures and second¬
wave of confidence will run into q
clined
at
the
moment
to
say to do today. The complete program
ly, private capital expenditures.
for this Administration is all con¬ period of disillusionment and dis?
A cross-section of this part of roughly 10 million tons more. Ten
million tons more is not bad.
It tained in the Mellon bible. We do appointment that will be very sad
American business is provided by
"1
is a reassuring proposition. Never¬ not have to try to be extra cute, to contemplate.
the
steel industry.
Since Pitts¬
Less controls mean a return t6
theless, when you distribute that or extra smart—all we have to
burgh is famous as a steel center,
do is to read that bible. It is prac¬ free markets. "If this new Admin-#
over the year, you find that in the
it is in order to comment on the
istration does not believe in free
outlook for the steel industry in early months of the year, the pro¬ tically all there.
I have great
But lest there be some forget- markets it will fail.
duction will be running at a much
The

question makes sense only

when you

1953.

apply it to the remain¬

we

might

years

have

now

program

United

the

positive.' Balance

and

for

prevailing.

Boom-Part

,

and

budget

and

for building equipment, and tion now to the financial question.
machinery used in these Capi¬ For many years, we have been
tal programs, running 10 to 2U% through
the experience of fear
to such a substantial extent that
below the rate that exists at the about the dollar, fear of inflation.
no
longer do
they justify the
present time. That would still be We have heard endless discussions
word, "boom." The sum of these
a very good rate.
It would still be of the national debt, of the budget,
parts represents about 60% of the
of
taxes.
Now
we
are
on
the
a rate that in any other period of
total economy. In this area, it does
threshold of a new Administration.
our history would have been con¬
not make much sense to discuss
sidered a very satisfactory level. The incoming officials have made
when is the "boom" going to end,
But, after all, it would represent commitments and promises, have
because it has already ended.
some
decline from the peak now set forth a policy and it seems to
Raw material markets.

Each of these has been corrected

The

afford the lux*

we can

of disposing; of tne excess
profits tax." That is a timid ap-

.

Automobiles and electrical
•

if

see

"boom" is going into a "bust" and if we can balance the budget.[Let
judge, the will become a major depression. us hope so. Let us try and theq
rate
expenditures will Both viewpoints are wrong. Any¬ maybe we shall be able to d<?
slow down toward the latter part body who subscribes to those the¬ somethingabout tax relief."
No^
will
find
himself making The attitude was strong and defof 1953 and in physical terms, the ories
As

Export trade.
Consumption expenditures.

buying subnormally.
sumption

Thursday, February 12; 1953

These include the struction activity.

"boom."

a

following:

anything, he is
The con¬

if

and,

has
nor-

.

jobs. These are man who has an overdose of con¬
trying to make up for lost time fidence and who says the "boom" proach and it was. not the Andrevyr
and such effort tends to exagger¬ will last forever. The other fallacy W. Mellon approach. The approach
ate the current months of con¬ is by the pessimist who says the at that time was not, "Lei us see

Outlook for 1953
was

.

of American business today. One and
in by the ury

slowing down in a num¬ is the fallacy believed

ber of construction

who

.

ourselves for

pare

as

some

•

First

a

word

about

Before

program.

normal level of residential build¬

election

ing activity under present circum¬
stances. i The residential building

penditures

and

the defense

during the

to what that program confidence that it does believe in
I presume to give you a free markets and does believe iif
refresher
course
in
your tax relief. I think that courage in

higher rate than the 10 million ton fulness
It is hard for

increase.
steel

how

as

to

see

was, may

actually consumed,

ac¬

little

rne

campaign, the defense ex¬
memory
of that period.
First, this field will open up not just one
were
based on what tually chewed up in American in¬
During that term of office but the hopeful
dustry in 1953, can exceed 105 to funding the' debt.
was known as the stretch-out sys¬
"boom" has come and gone.
We tem. This was a system of spread¬ 110 million tons. At the moment, period, the debt was not all fund¬ possibility of a prolonged experi¬
do not have to worry about when
a
figure closer to the ^bottom of ed in long bonds. The funding was ence of political leadership in the
ing defense production over a
If we
it will end because it has already
this range than to the* top seems done to about the extent of one- United States of this type.
period of time and of avoiding go¬
more reasonable. However, the in¬
tenth in long bonds; the rest of fail to take the guides which have
ended.u
ing to any abrupt extreme peaks
Likewise, there was a "boom" and then having a very sharp dustry will have reached a capac¬ the funding was from very short been given in the past and if we
in the automobile business when,
intermediate maturities. go off on strange adventures, then
sudden decline. Under that stretch¬ ity of 118 to 120 million tons. I do debt to
in a single year—the first year
not quite see how we can use that Most of the funding was into obli¬ I think there is grave danger this
out system, we were supposed to
that the Korean affair started—
having maturities up to will be a one-term Administration.
go up to $58-$60 billion a year in capacity fully in the latter part of gations
Since
this occasion
is in Pitts¬
there were built over eight million
seven years.
total
defense
expenditures,
in¬ 1953, so I would think there would
be something less than 100%
I think it befitting and
passenger cars and trucks. In re¬ cluding
of
That funding program began at burgh,
foreign aid, and to stay
cent months, we have been pro¬
latter a time when the bond market was proper to pay tribute to that fi¬
there for an extended period, per¬ capacity operation in the
ducing at the rate of something haps several years.
part of the year. How much less low in price. It was approximately nancial statesman of the decade of
the 20's, Mr. Andrew W. Mellon,
like six million a year. That is a
is a question that I hesitate very the lowest it had been in 20
years.
During
the
campaign,
the much to
sharp reduction from the peak. I
answer, but in all frank¬ Again, today, the Government who did a very kind thing for the
speeches by General Eisenhower
think
that
over
the
next
few
ness, I find that the figure that bond market is approximately at leaders who are to assume respon¬
discussed this defense program, in
He
months, the automobile companies
always comes to my mind as I the low point of the last 20 years. sibility a few weeks hence.
some ways criticized it,
promised
will
be pushing
hard to make
study this is that toward the latter The funding then was done on a gave them a good blueprint of how
to try to eliminate some waste and
more
cars
and to sell more cars
part of next year we might have rising bond market. At the time to work out the pressing financial
inefficiency in order to get more
and I think it is
reasonable to
steel operating rate of between 85
the funding program began, long problems of the United States. - "i
end product for each dollar spent,
and 90% of capacity. That would
suppose that their output in 1953
Governments yielded better than
promised
to
apply
economy
as
will be somewhat higher than in
not be too disquieting but it would
much as possible and raised hopes
5%, and when the funding pro¬
1952.
But I suggest that as the
.mean that the steel "boom" would
gram was over, long Governments
of some more moderate defense
not continue at an absolute peak
year goes on they will encounter
yielded about 3.3%. Mr. Mellon
expenditures.
We do not know
more and more sales resistance or
rate without interruption.
funded the debt on a rising bond
just what figure was in General

Firm NameHaul

saturation of their market and will

I

talking to a friend of mine market
He said, "So you're*
If you stop to think about it,
selling effort to move the product
going out to Pittsburgh." I said, probably th^re is no other way in
into the consumer's hands.
"Yes." He. said, "I feel sorry for
which any Secretary of the Treas¬
The same is true in the electrical
carefully go over the campaign you." 1 asked, "Why? That is a ury can fupd fthe national debt.
appliance field.
In 1950 and in
fine
place
to
visit."
He
said,
It
has to be clone on a rising bond
speeches that the new administra¬
part of 1951, there was a "boom" tion will
try to hold the defense "Every year for the last few years market and again, the bond mar¬
In electrical appliances.
At one
expenditure to around $50 billion. you have gone out there and given ket at the time a new Administra¬
point there were roughly two mil¬ It
those' fellows
a
cheerful
story. tion begins a funding program is
may
temporarily go a little
lion
refrigerators
in inventory. above that but
You have told them business was
at a relatively low point in price.
that is the cam,*
That was a great source of worry,'
paign pattern of defense spending. going to hold up. You have told The conditions are made to order
but the excess has been cleaned
them that business was going to to start off on a sound debt fund¬
Actually, it is "a little above that
be
stable. You have
told them,
up.
The,situation is in good bal¬
right now. -It might go to $55 bil¬
ing program. It can be sound in a
ance now and I think this will be a
business was going to be good. firm to
lion by June.
rising Government bond
If you accept the:
Now what do you do when you go
good year in the electrical appli¬
market campaign promises, you look for¬
ance
field,
out to Pittsburgh and you have to
However, as we get ward to a
The
other
basic policy in that
$50 billion defense pro¬
into; the latter part of the year,
tell them something different?"
gram sometime in 1953 or 1954.
period was on the side of the
I said, "I shall just tell them
again it is going to take much That would mean some
budget and taxes. I remind you
slight cur¬
more
intensive selling effort to
what I honestly believe. They do
tailment in the
rate of defense
that when Mr. Mellon put the fis¬
take

more

intensive old-fashioned

Eisenhower's

mind during the
speeches, nor do we
know what figure will be finally
adopted. It would appear if you

campaign

was

the"6tKer day.

•

move

the merchandise.

Also, in the year after the start
©f the Koxean crisis, there was a
"boom" in

ity

raw

prices.

An

material commod¬

index

of

25

spending in the
year.

not

last

part

of this

But the curtailment would

be

serious

enough to greatly
affect general business. However,

raw

it would mean that defense spends
suddenly shot up 100%.
ing would no longer be acting as a
Subsequently there occurred a great and
powerful stimulant to a
sharp correction and deflation of "boom" in the durable
goods in¬
most raw material prices.
There dustries.

materials

are

a

few

exceptions but

aggregate they
To

are

recapitulate,

in

the

the

word,

all parts of the economy.

specific

parts

there has

at

of

one

the
time

In five

economy,
or




another

Private Capital Expenditure
The other part

of the "boom" in

the durable goods is private capi¬
tal

expenditures.

and
year,

in

the

these

first
are

told."

say that in the durable
side of business this year
you should have your guard up.
You should approach the year with
some caution.
But do not carry it
too
far.
Do not be unduly dis¬

Now, I

running at

of
a

tolerate

profits tax.

It is

that he could have

car-,

an excess

doubtful

ried out his job had there
excess

type

profits

in

been an

tax of the present

force.

Successful

per¬

you as

this
of

a

yet

as

those observers who tell possible only when the iniquities
soon as there is a ripple, as of an excess profits tax have been
there is

a

little decline in

convincing evidence that

a

major business depression is in
this sight in 1953 or in 1954.
There are two great fallacies
very

high annual rate, partly due to the that stand before the imagination

^

Willarci>,;3Q ^

Jr., and a change
v
Will&rd* with Williaiq; % a~
D. McCoy and Alvh^ WiUard as 4;•>*,
partners.The^firmrfAvijJiCOAtinuQ^. w
to act as brokers, dealqrs ^nd un^ . .
derw ritcrs

of

as

an

-

Minof wilt cohtihuQ

Wayland M.

associate.

Excess

Profits Tax

the
to

profits, tax. We ought
balance the budget first; wait
excess

*

;

--

-

J. C. Moorhouse With
Deacon

Findley Coyne

TORONTO,
Moorhouse is
Deacon

now

Canada — J. C.
associated with

Coyne Limited,
-in the trading de-

Findley

197 Bay Street,

partment. Mr. Moorhouse was for¬
merly an officer of J. R. Meggeson&

Co., Ltd.

William L. Purely Now
With A. C.

Allyn & Co.

(Special to The Financial Chronicle)

Today I find some spokesmen in
Washington saying, "I am not sure
that we can afford to dispose of

:

to McCoy.

eliminated.

that, that is the beginning
major depression. There is as
or

no

&

Federal Street, has ^aftounce4-ih® fVv.
withdrawal of DanieFM. Sheefaan;^-:^

formance in this financial field is

turbed by

At the moment

quarter

in order, he refused to

cal house

goods

soon

not important.

"boom," does not apply today to

not mind being

BOSTON
Sheehark,; McCoy

BOSTON,

Mass.

—

William L.

Purdy has become associated with
A. C. Allyn & Co., Inc., 30 Federal
Street.-Mr.

Purdy

was

formerly.

Vice-President of Trusteed Funds,
Inc.

.

-

'

Volume 177

Number 5194

.

.

The Commercial and Financial Chronicle

.

(709)

■

C

.

Continued

;

*The

while
it
will
depart from the
"policy followed by the Democratic
'Administration, is bound to be a
gradual development, for other¬

fromspage 2

Security I Like Best

few

has

years

the

placed

$20 per share

com-

)pany in a well balanced position,

able

it will affect adversely not
only the money market but also

are

nf

pnH

th^

■

integrated

fully

in

-

its

A?M,2n

<

r-w

3
i

also iarg

-.^Earnings

I.

,were

«

and

Ktm"ture detr omted

nrafiffft

demand

tirmed

to"?

up,

of

.

Jj>z.zd per snare.

and

t

be

influenced

a

,

.

by

an -un-

in

more

a

have

decided influence not only

a

business

on

activity

but

the

on

Four wells have been drilled
far

three

with

installed completions and

imnrp«ivp

cinrp

successful

dry hole.

one

At

portance

that

fronting

the

the
tne

^ornnanv's
company s present
present

<

for
ior

-

;n+eresf.

expansion are drawing close to 01
completion,
and
finances
are
Strong, dividends may be liberal- L
ized somewhat from the- present

economic,

1IueieJsl-

is the

Capitalization
Term

to

seems

,,

,tinn

.n

If

1™

annual -rate.
It
•
P •
P
that recent prices Common stock

$1
me

.

be

5,170,714 shs.

to

■,

;

*

III

1951

'

'

■<

Share

Dividend

$2.25 (Est.)

$1.00

$16.8

3.11

0.80

154.7

11.6

2.10

0.70

127.3

5.4

0.91

0.60

$195.9

>

should

/.
i

1

1949

;
-•

—

1948—

162.6

14.8

2.71

0.80

1947—

143.8

14.6

2.66

0.25

82.7

5.5

0.99

52.5

2.2

0.45

1944-

48.3

1.8

0.37

1943

25.5

1.8

0.38

1946
1945"

either

by

credit

and

based

are

the

loans

unchanged

the

reflects

rediscounting

the

•privilege at the Federal Reserve
Banks.
The country certainly is
confronted

mot

during

will

1953

is., the

which

the

that

and

banks

had

there

was

if any abuse of either

should

remain

bank

the

of

stable.

depend on

decline in

1,

this catecknnW

tc

If this should

bank loans

igory of

J_e

a

likel.Y

should

uncha

remain

afnr

ge
_

several months. A contra-seasonal
"increase

would

'

,.

in

lead

unmrnerHai

e

com

to

c

a

i

lAhDc

prime

higher

a

i

i1

'

be

tsions

during

influenced

of

Tributors

■quidate

by

the
the

to

accumulate

disli-

to

or

and

inventories

year
w,
deci-

and

manufacturers

keen

more

and

so

in

commodity
•

.

S!
the

•

will

the

by

become

the future,

prices
,

+1S

,

international

and

.

even

since

leveled

have

,

,

.,.

UrH

.

;

political

UP.

^

s

situa-

^onshQuld deteriorate materially,
whether
increase

tories.
orate

there
in the

On

the

will

wil,

niirnn„pt;

v

more




sons

its

•

Sometimes

testing

elaborate

me

loosely and without

speak of high
standards in this country. A
apparent rea- definition is the high level
is
considerably dividual possession people

effect

An

first

is

reason

credit

is

credit:

term

Let

we

living
better

very

con-

of in-

enjoy:

automobile, a refrigerator, a
or
radio, the sum of

television

essentially short- satisfactions gained from their

Of

debt

that

consumer

the

of

total

all

And

from

50

to

75%.;

of

use

these

now

days is

no more than 1% of dis- known,
but not often found in
posable income. This 7% is instal- print, is the form of savings inment debt and the "run-off," the volved
in time-payment' buying;

nlace

tako

c

is

ment

the

announced

large, it is assumed that
,

will

Treasury

reduce

amount

the

to

endeavor
of

this

type

This cai} ^i)4 should be
Pi
such debt
The impact
impac^pf
"such
debt

""

"f'thp

b°n

fi0atine

should

debt

°fnJp,.etJ^medium
^en„;t°enr^1owigatimis^hen
since
?"g .td™

or

the

demand

snort term

101

odii

gations by banks and industry is
bound to remain large, short-term

the

following

^he

trend

of

,Iinn-

„

refunding

The

certificates

long-term

of

a

to John F. X. Frost will
considered by the Exchange

u'Ta"

additional

an

the

one-quarter of

mod-

likely to

one

.

as

cent.

attitude

the

ments

and

of

o{

the

Joins

on

money

mav tbprp.
From the ahove
above, one may
therefore conclude that the principal

force

Richards

market

...

...

during
..

.

„,.lt

1953
.

,,

authorities and debt

agement

by

the

Treasury,

1951,

,,

second

an

which

was

reason

of

service

and

I utility and the extent of this

sav-

—

John

with

Jackson & Curtis

.

T

statistic in

a

standing

merely

accounting

is

.in

;

found

consumer

in

with

Walston,

was

reflect
the

date

at

net

between groups of buyers

some

Hoffman & Good-

buying,

There

No date line

prosperity

ever

marks where

ends and

actually

de-

of consumer credit on alternating periods of prosperity and

ence

dePres^on ls

difference be-

L0UIg

Mo_LouisS Block

o," '

ci,„_

street

^408 Olive
Company, Inc., 408 Olive

'

FULTON, Mo.—Henry A. Pigue
js

who

~

"carrying

j10W sjia]}

WeicTi

we

the fi-

charge, the value of credit
any
particular situation? \ Six

jianCg

jn

per cent

discount by

calcula-

easy

nav-

6%

tor use as lai* as the finance

Volume of Consumer Credit

the

use

influence

an

use

or

less

same

will

with

months

to

bu

should

caIculate

fluctuations

on

consumer

less,

come

charge

is concerned; a family faced
the probiem of buying a„
of all produc- automobile on time or
saving 24
....

in

Hismnnt
discount, and
anH after
aftpr customary
BiKtnmarv

down payment costs 22 cents a

less

in saved costs in other directions—
incomes bepublic transportation
recreation.

secure,

people

credit

consumer

For

general reason a busidefer capital or other

expenditures.
.

,

All of which may sound simple

and elementary to an
- intelligent
—

audience such

as this: Our excuse
jg that simplicity is the last refuge
for
the
complex,
and complex

Slmpie

truths

we

have

dis-

niccprl

A

^3qq

refrigerator

financed for

J8 months costs six cents
use.

ice

convenience,
should

be

a

health,

day for

cost

for

uge;

consider

of
$300

A

calculated.

television set costs six cents
—

saved

a

day

in

costs

outsidVentertamment

°\SaiueeiiseiconncTdeeV
unsettled

thog

area

to

of

the

be

economic

ght, and nowhere is this truer

2.

'

-

Percentage-wise

Too
~

consumer

considered
n

tussea.

often, like Othello
conwith King Merritt & Company, templating Desdemona, critics of

Inc.

so-called

^nth an°rt thosl
tion becomes n-7% annually, exth'e .ittivelv £1 1 Pressed as simple interest: Butfor?"d S*h:iment debt 1^ g'®
*■*** °efi ^ a,f2'000 aut»:

Consumer Income Regulates

^be

(Special to The Financial Chronicle)
A

and

charges."

economic theories too often hide than when the value of credit is

With
wim Kinff
iving Merritt
mcrriii
__

"rate"

mobile financed for 24 months at

ness

(Speclri to T„E M cmoma.)

gT

widespread misunder"discount"
and

about

Qaidates.

the

h,,

is

standing

"°d in which instalment debt 11

Will

Joins Slay ton & Co.

-

.

Misunderstanding of Cost of if
Consumer Credit

balance

market.

previously business. If

win.

consumer durable goods in exof $55 billion.

cess

credit

a

.

He

of

going into debt, and other groups
If these are the benefits of inpaying and coming back into the stalment credit, what is its cost?

■

Building.

years

$520 mil- ing is indicated by estimates which
outstand- show consumers of this country
70.5% li- holding a depreciated investment

G'.„M2ran haTs become connected tion and distribution, credit have
J

more

Th^s, we suggest, is impressive
It is negation of the "mortgaged fuvacuum; offi- ture" concept of instalment credit
cial figures of consumer debt out- buying.

not

„

With Irving Lundborg & Co., 926

many

it works in the economy:

as

SACRAMENTO, Calif.—Thomas Changes

-

This,

with

JBut why consumer credit?

will

man-

3^

character

With Irving Lundborg

/e,

policies of the Reserve

Calif.

previously

was

Webber

paij^o

operating in the short-term

money

ANGELES

Inc- 215 West Seventh Street. Mr.

market.

From th

The
the

A- Richards has become associated
with Witherspoon & Company,.fafh

govern-

of gold in terms
will exercise an

the

WitHcrspoon Co.

(Specini to the financial chkonicle)

LOS

banks toward

central

dollar,

influence

foreign

connection

this

pression begins.
But from any
noint
time the
influpoint in
in time
the maximum
maximum influ-

u

Other factors,

too, such
the movement of currency and

per

011

rates

indicate

should

tT:Ts

be

Feb. 26.

February

the

jng F)ec

firm

bership of Raymond H. Sigesmund

decrease irrespective

wil1

rates
of

in

operation

some familiarity:
lion of automobile paper

is

inven-

of

contrary,

reduction is

another

be

volume

for two

New York Stock ExchanSe has quidated within six months.

.

tax purposes win iaKe p

roi

tax, payments. Since competition the future price
is

*

of income. They have found that
the intelligent spending on time prowhich vides a new way to better living

conditions

have

YveeKiy; rirm v^nanges

substantial increase in borrowing

extent to which holders Oi these

rate
ldLC-

loans

Bank

"tcu

innnmfl

business fluctuations; how-

on

actual

'

New York Stock Excn.

obligations will be influenced by
will

create

Consider

.

reduction on the 'short - term
the money market wilLdepend[on the
tyPe and magnitude of the re-

(1) The Movement of Commer*cial
ial Loans: During the first half
t
•ef
the
year
seasonally,
there
a

supposed to heighten

^

goods

mem
anu
need them
and
pay
yay out
uut

VVAIWI.

Vipiaht^n

fr»

durable

outstanding— and other durable goods that give
realization that charge
accounts, instalment credit equal satisfaction are bought on
of
bank —the estimated amount that some
time-payment plan./ And
result of economic would not be liquidated within 30 thrift:
Something
fairly M well

or

Whether or not a

place.

take

done.

/following factors:

:should be:

buy

volume

credit

rates

short-term

of

trend

our

the

on

over

walls ,of

new

prosperity and in

ever,

sumer

the

If the latter

—

of of debt.

balance

a

problem.

payments
The

by

^

ic
is cnnnneoH

of

process

bank

for

demand

by the policies of

control

no

tho
the futnrp
future

The

impossible to state at present. changes: .
So iar, there me no indications
Transfer of the membership of
that borrowing tor tax payrnents j0hn j Neff to Sidney M. Louis
of currency in circulation;
and will be large on March 10. iV1<?st
considered by the Exoertain international financial de- large corporations nave made the change on Feb. 19.
•velopments.
It cannot be said necessary
preparations
to pay
Norman J. Myers retired from
That private bank credit was used their March tax liabilities.
partnership in Silver, Barry
&
To
any
extent for speculative
(2) Debt Management:
Since Van Raalte on Feb. 2.
«
purposes
or
that
the member the floating debt of the governTransfer of the Exchange memabused

But on the

HicpncQiiiiy

now

limited.

v

7

primarily the high reserve re<quirements which, with the ex•ception of the central reserve
•districts, are at their maximum;
"the sharp increase in the volume

ibanks

mortgages at 6%."

rediscounting payments, would liquidate even automobiles
and
other ' durable
privileges, short-term rates, with this small percentage within a goods,
paid for in 18-24 months,
normal fluctations, on the whole
relatively short period of time, are the physical embodiment ot

Banks

Reserve

word,

oL thl-

influ-

'

the

are

we

the feet

of

rates will be

increased

forces

"

sector

remain

.

.

management

long-term rates

authorities.

Reserve

Trend oi Interest Rates in 1953
To

.up

periods

,/

.moderate decline.

a

enced

little

<Continued from page

civilian

Short-term

'

la-

1950

:''

magic

a

~

clearer than

debt

Hence

witness

or

'

j

the

economy.

•Net per

(In Millions)
■

not

Despite some attempts with credit

mortgages should be equal ment: Consumer credit does have
even
surpass
the demand a stimulating and depressing ef-

or

•from

-

.

1952__
»

+

,

Year

.

is

Asked how they managed to
get along—"Oh," said Cal's father,
"there's a couple of Iowa farm
ence.

adopted, the supply of deepen and prolong depressions,
and
thrift.
seeking an outlet in bonds
And with this we have no argu- briefly.

*

Net Income

Sales
•

Credit

is

and in

_

Earnings Figures

-

Nothing

To Income

con-

at present.

realistic

a

funds

h

«qr

>_

—_

r"

.

Credit Can Add

-

much

are

case

policy

Debt_.$57,628,000

—

indicated

ugently

For those interestcd in statis" ®}10uld. be adopted until condiWell—here is the trap, some "wealthy,"
tical details,the following will be tions, international political and contend: Use of credit to buy into when they

Since

Dlans
pians

credit,
practical and

if
ppp/lit
cpf A"f
1
T
f
n
i
• ^
^
discussing it,
credit new set
of rules.
Instead
of skimpy
can add nothing to income; it can living and doing without, middle
only alter the time when income and lower income groups in this
refunding is spent.
•
country,
and
many

*

or

6

more

chan-

sales

out, lived a pretty skimpy exist-

authorities

at

nroDerty

was

instalment

country, problem of inflation.

problems

these

thp

npr

of

debt. Over-all purchasing power
William Allen White in his storV
certainly hasn't been changed.
of Calvin ■ Coolidge tells of the

conditions are so highly
uncertain, it is of the utmost im-

tha^aearnlngs\h7s qvear th<i, preseilt.™£other
ha^dled not with preconceived
may reach a new high. This would
0f bourse, watching develop- high°lyS suitable ^o^orms ll times
'
course, wdiLiung aeveiup nigniy suitaoie to normal times
nrpvin^^
menis closely and may be ex- —the policies must remain flex1Q?1 ^nHnHpH
JLre at- any
pect(:d
to I?.a^e *
m
out
and no definite pattern of
1951
included $0.60 per.share
future finds.
interest rates
debt
and

through

nels

invincible and dour devotion of
those Northampton Bluenoses to
cash as an instrument of trade,
their suspicion of the man who
bought on credit. They did with-

foossible

Vestments

rr'j-y

The rise and fall of consumer
credit results more from income
variations than anything else:
Personal income is the chief cause
manage- of the money side of the jigsaw

Because

thus

<snfiO

f

of one segment of! the population its essential virture. Surely the
nth<J
rv!ifi/aVlngS
^SJvinn011 31
dlstnbution of
Minimi 5^?! ** CX~
passenSer automobiles m.
ample: Millions of dollars of pre- 1951, sold largely

developments.;

early in 1952. As a matter of fact, of the credit and debt
Stan0|.md
'! already working on ment policies of the
portion of the company's prop-

to

and with over 200,000

nartipniariv

To Market! On Credit
.

large extent mium income of insurance compainternational "nies — dollars that decrease the

~

erty.

capacity

would

the^lure of

on

company owns
half interest or

divided

since

new

who

the

acres

a

Roth
DOtn

.

have

prices

speculate

,

during 1953 will to

10

page

dS -he minera' rigf JS? icr!1ge psychology of business and of in?vi J J'r
2 dividual consumers.
nrice Jvhere. ,HVmble
0l1 & Refining
This places a great responsiT®
af lmPortant. weU bility on those who are in charge

,

share

ner

those

•

-

Economic and monetary trends

1951

Mnprl

m

t2 2S

Conclusion
,.F

10

in

S3 1L

Xvhen demand slackened and

estimated
estimated

.

following..

.

i„Toia to's2

share^n lifii?

^

qsi

ly comp

for

jrom

What-these'"will purchasingpower,' Increase" t he nationally more important"'than'a
oil, there is the cPmpanyts own- be is not known." It is, however, savings of policyholders - are few in debt, or highly nebulous
ershlP of nearly-300,000 acres of certain that a change either for loaned to finance companies; these economic theories. ' ' "» "
J
timberlands in Florida s pan- the better or the worse is bound dollars in turn are loaned to in- ; Which brings us to the topic
handle. On about 250,000 of these to take place. Either one will dividuals and become instalment itself—"To Market! On Credit." '

of

o

to

care

i

Hffl

reason-

.

Further,

™--

bUainess activity in general.

...

became,

on
an

most

a

appraisal of this company's

future
By^the end of 195K the fJnmnanv
company future
thp

Continued

wise

Mansion of facilities, in;-the'past for the shares in the vicinity of

37

.

.

credit

fail

to perceive

credit
n

is

1

consumer

higher than

Continued

sales

production.
on page

3&

38

The Commercial and Financial Chronicle

(710)

Continued

from

And

37

page

definitely credit should be

To Market! On Credit

sales

program

tne

on

the clear reason

dling

higher—a higher num¬

are

transactions in relation

of

ber

credit for
that costs of han-

distribution

to

investigations,
record
keeping,
auditing, collecting. But whether
consumer credit is relatively high
has

point here; for it is a nec¬

no

their

post of distribution, and in
present stage of develop¬

ment

consumer

essary

credit

costs

are

ganization, there is understanding

tion:

cance

Perhaps it is not out of bounds

said

Caesar

"That

far. He in¬
As a first congo

man

tends

Brutus,

to

will
strongly."

young

sideration, then, in successful sales
credit
production,
management
must intend

strongly.

stimulate farm machinery

sales.

finance

first

The

copy

of

here that net profits shown John N. Willys, pioneer automoin published reports of efficient
bile manufacturer, was set to
and reputable finance companies stimulate sales. Yet with such long
hardly prove them to have the history and the sales-creating acsoul of a usurer.
And speaking complishments of consumer credit
for one such company, we in fi- 'over the years, some in managenance are as interested as you are
ment still view it as an unavoidable evil forced
upon
them by
in helping to bring to market bet¬
customers
and competitors.
ter products at a cost more people
Such
a
view,
I
need
not
remind
can
afford.
Therefore, as an ex¬
tended arm of distribution, we are you, can put a dealer and an in¬
dustry at a competitive disad¬
constantly working at the job of
new
methods, the elimination of vantage: The aggressive promo¬
tion of credit sales by one, the
waste, lost motion.
to say

r

failure to

But to market—

Some fancy word

worker para¬
familiar line to read,
"Carrying anthracite to Scranton":
phrased

a

We think of this when we remind

distribution

a

that

conference

uct, the desire to own it, and

that

the

buy it.

And there

two ways to

are

—Cash and credit.

buy
cash

the

And

purchase of less goods but in the

and psychologically the two ways

don't

work

costlier

the

out

where

same

sold:
the lesson all marketing

durable

Because

goods

the

some
an

the

auto¬

sales

they

riding around in auto¬

were

mobiles

"intends" to
here

are

promote sales credit,
details:

some

save-to-buy

present fleeting enjoyment
imagined future in order to

tor—A

good

Naturally,

Those

who

regard

inclination

feel and see.

chandise

terms

A finance service is

kets

to

level.

some

In

market

to

way

drop in all marpermanently lower
a

costlier

industries and in

durable

a

goods

host of indus-

dealer

and

sees

the advanplan as the
interprets them,
see

credit

Find selling words for your plan
that tell the best story—because
words are the shell of ideas, and
if you

don't have the

words you

short

ure

timum

of

profit depends so much
upon full activity: In any busi¬
ness, the credit market is the top
sales market; thus it is the high
profit market.
With
our

for

this

thought

running in
minds, consider with me ways

developing credit sales.

As

a

broad observation the pro¬

motion of credit sales differs little
from any successful sales promotion: In few ways

problems

of ownership from the "pain"
the price tag. The economies
buying on time—such as we

have discussed.
Have

or

Plan, clear,
understandable; all the purchaser
has to do is sign.

waste

credit

costs,

(1) Proper management direc¬

named

The

(2) A good credit plan.
(3)
A trained and tested

organization.
(4) Credit

oughly

is

a

trained and

we

tested

named

sales

or¬

management

grounded

in

thor-

finance

and

We offer

some

sales

specifications

on

MnCi leaving to your intelligent
imagination the job of filling in
spaces.

And

as

we

less creatures of

are

all

our owrn

needs

trained

shall try

to say can be




promo¬

Salesmen

men:

sell

to

both

credit-wise.

in

salesmen

must

at

merchandise

Importantly,,
all times be

time-sales conscious.
Credit sales material should be

required

study

for

should
on

-

fertile

within
of

a

the

flight
Con-7
with

G.

century

the

population

United States will uouble,
standards
will
be
eight

all

out"

tions

and

these

—

cugsion

From

depreciation

profit;

social

a

of

_

of

"7

In

a

,

har\ds

rates

this

as

For

Credit

must

be

unless this

is

wil*l

there

so

distribution.

Irving Sumergrade Now
With Gottron, Russell

a

[-

;

and

on

experienced

;

can
be accomplished
and t persistent; system
The trouble; isvvith

of

tomer"

dues

past

tors

in

the

and

with

good

effort;
collection

in

collectors
social

the

770'

collection

and

ad jus-

of a

graces

bouncer —these

heavy

re¬

and

losses;
"debtor," too little "cus¬

much" pugilism

letters

to

-

ma¬

negligible percentage- in -the

too

level,

be

the untrained: A striving for some
duction

'

to

expand.

be less

and

express

*

firm

.a.

them

leave
appear

getting

minimum effect

./trained

too much

the

■

sales

and

in

positive good.

Consumer

free to

opera¬

on

and

any

debt:

full

a

credit

can

volume.

busi¬

in

suggests

thing of balance;

a

we

turities with

everybody who would "benefit
its use;, credit for everybody
wanted

in

sales

balance

a

the ideal situation would be credit

by

because

depend

risk, must be

credit

result is. loss of

dealer's net

serious function

a

maximum reduction in future

that

the

the years go by, consumers
must
be
left alone
to
go
into

Getting back your money in any
operation, as with,, our dis-^

finance

production

to

As

back your money.
Nevertheless—

key factor

demands

a

doing

credit

in

Huxley

harm; indeed,
if they don't

alone

function of collect¬

loss

by

and

tive

in

policy, one that can "reach
for
marginal business, the

of collections.

certain

;

should

"Listen to the Drums" that among

recent

payment

your

concerned;

profit

positively sales point of
Undeniably, protection ;•> of
is important; but if
credit is primarily thought of as
risk, as a chance to lose money,the

A

Aluous

and

in finance don't joke about

credit

a

ness

man"

can,

mortality and

customer

.Irving Sumergrade

1 *

/,

cause
7 7 7 Special" to The,Fi£ancu£

CHroniclI)

*

/'

buy:
But as a
CLEVELAND, Ohio—living;
practical merchandising and profit .big loss in volume. Actually they
consideration, the credit policy impede rather than help collec¬ "Sumergrade -'has become assocK
tions
needed is one that reaches out
by
adding resentment to ated with Gottron, Russell & Coj,
and

down

the

lowest

for

the

to

best

the

terms

whatever other

and

for not

marginal risk consis¬
tent with sound credit, and rates

actions

various
to

classes

financed.

be

of

<•

trans¬

:

we

are

have

we

this by say¬
not contradicting

the

said

suggesting soft,

about

Nor

buyer.

seasoned

are

terms

and

that

and

business

in

are

measures

A

strong

good

nance

and

think

of

itable.

and

"too

credit

risky"

loss

exceeds
If

all

—it

Is:

for

only

transaction

when

the

is

this

complicated
balance between
a

thereto

7

(Special to The Financial Chronicle)

i

LOS ANGELES, Calif.—Francis
'

V.

credit
fi¬

Nixon

and

associated

become

Fewel

&

Street,

members

Co.,

Nixon

A.

Thomas

have

South

453

the

of

with

Spring
An¬

Los

geles Stock Exchange. Mr. Francis
who

Nixon,
Coast

and

and

on

the in¬
Pacific

in
the

in New York City for

recently

years,' has

con-' many
1

been

has

business

vestment

abilities needed to attract and
—

:

Co. Staff

Join Fewei

in

&

& Co.

Font

Francis & Thomas Nixon

with* Edgerton,"

been

Lofgren &i Co. Mf.

■

■ Thomas

order to keep clown the little cus¬

with
r*

tomer-killing

annoyances

■■

,

A.

Nixon

was

formerly

Wagenseller & Durst.
r

*

that go-

with inefficiencies. You may think
of still others. 7
7

Joins

^

F

Edgerton, Lofgren

■

gone to school in the
industry are promoting
"low,-low rates" as a competitive
attraction: Rates, however, have

(Special to Tta Financial Chronicle)

But my

time is used up.
Bliss Perry wrote that even

financing who
»

1

neVer been and never will be the

LOS ANGELES,
Califs-David
a
point.. D. Cushman has become affiliated
Co.,
If we have made, any /point at all, with .Edgerton, Lofgren
609 South Grand Avenue. He was
we hope it's that instead of being
bad- for the individual and trou¬ previously with Edgerton, Wykoff

whittle should whittle to

a

.

dealer's merchan¬
dising" problem. Rate is secondary
as
long as- it is. reasonable. Low
rates inevitably mean a
higher selectivity of .credit risks
and such a policy simply doesn't ;

blesome

any

•

•

for. the

economy,

Con¬

,

& Co.

distribution and happier and bet-ter' lives for the people of this.

country.

f

Though it

;-7

7

,

is

r

>

1

Over-all,

Calif.—Charles

LOS ANGELES,

only

one

answer.

Barringtopr Jr.

has become. Asso¬
Williston, Bruce
Sixth Street. Mr.

ciated with J_ R.

-

•

-

Joins WilUston, Bruce

prepared or ticularly acute, for example, in 7 tribution, we submit it is a valid,
credit should be made the case of the automobile dealer: : and vital one.
Barrington, was
*
—

-

(Special to The Financial Chronicle)

& Co., 530 West

well

.7

.

tq the manifold problem cot dis-.

-

*..*•■'.

Credit

is-justifying itself
magnificently in terms of wider;
sumer

'

The sale of used cars, as you

with Bache

was

'

not

to

.

prompt credit
approvals,
efficiency in every transaction in

and

finance

answer

,

tacts,

matter

management
credit judgment.

.

business
courtesy
friendliness in all customer

sounds

competent

prior

Co. and Francis I. du

al¬

merchandising. And we
other credit capacities

hold

rate

class of business
profit for the "class.

Proper

-

organization,
trained both

management

any

the

Walston, Hoffman & Goodwin and

which

Summary

sales

of risk and rate
producing higher gross
losses may, nevertheless, be prof¬

A type

A

balance

a

management Intentions, a
credit plan, a trained and

tested

10%.

is

Backing up for a summary—as
requirements in successful credit

there*is profitable
rate and risk

Commerce Building, mem¬
the Midwest Stock Ex¬

of

.

sales development we have named

of

may¬

be

.

credit judgment can

.'

.

several

classifications—4%, 5%, 6%,

,

most reach....

unhealthy

rates

•Union

are

bers

'

we

credit
substandard paper: What we
trying to say here is that

and

,

customer good will—how¬

there

ever,,

terms

are

there

reasons

•

It's difficult — the problem of change. Mr. Sumergrade was for<merly
Cleveland
manager ' for
maximum reduction in maturities
versus

We should protect

paying.

a

be

part of the regular sales manual.

real

a

consider
connection

Moulton's, Brook¬
Institution,
estimate
that

in

Madagascar."

ing because it's
for

and

salesmen,
Where manuals are employed in a meet the full merchandising needs
selling operation, either a credit of any deafer-. Its failure is par¬

experience, our specifications will manual
apply to a retail dealer. However,; sections
we

sales

on

or

view:

have

credit

down

the important

credit management

as

Some now doing

demonstrating an automobile, or
refrigerator, or television must be
and

these four factors in roughest out-

more or

tion

for

in

that, "If they

receivables

of

third key factor

Harold

ings

all

and

future,

Credit

living

methods.

observes

We

as

unwar¬

customer

sales and rate and risk is

dealer's credit facilities.

Successful
sales

merchandising,

what

using the

a

sales

company

collection

fall

credit, in higher
dues, reposses¬

of

maximum

credit

of

and to the advantages of

Dr.

taking is not
is

the

sumer

•

-

Ethiopia

past

thoroughly grounded
merchandising.

As

any other stock-in-trade,

few

bro»
billion

offer other things democracy is nonin¬
World
Tours
on
the
instalment terference, in leaving people alone
plan it's going to be tough if you so long as they are doing no posi¬

funda¬

in

Our fourth and final
we

structure

ganization.

tion.

this

of

sions, and loss of
public good will.

display — distinc¬
tive signs,
window cards, con¬
venient price tags—help build the
buying and use-of-credit impulse..

Point-of-sale

The

of the contract

results

rule

ranted

risk

complete

a

whole window displays have been
does credit raise profitably devoted to credit plans

permit procedures
peculiar to credit. The key factors
in credit promotion are:

the

on

risk

increased

finance

one

through harsh
otherwise. The

or

lidity— violation
mental

fitting

The credit sales market has special significance now, when op-

his

If my convictions have any va¬

what

-

be

buyer's cash and in¬
come
permit —for only in this
does the buyer find "Easy Terms."

that brinS out—best—the kind of

Credit

should

the

as

credit operation you have. Words
that separate the ease and pleas-

^

of

into

income

groups.

dealer—it

for

"the

ability of the buyer

the period

and

ing that

Sales Market

out¬

next

the

recent, estimate

$50 billion

frequency

lower

risk

lines.

payment should be as large

The insurance and other features
—their need and economy? Words

Significance

field

that

high

a

imperative for the auto¬

an

mobile

Sales¬

than they are

contract

measures

down

of profit for all, the dividends of
many, failure for some.
,

large in¬

credit

..

collect—either

to

legal

haven't the ideas. What are the
purchaser benefits of the Plan?

„

is

among

marginal

only

pay, rather than the ability of
the seller, or his finance company,

tries that supply and service them,
the result would be a severe loss

Present

within

in family

a

consumer

One

years:

use

credit

ment

that

cash

mer¬

understand

more

no

tailored to the

is

the

selling

there

Constructive

to

tages

the

shift

Generally, terms of any instal¬

get

of

standing

changes

require

A brief word in conclusion about •times Higher: " of cred¬
From which
them otherwise is collections—with a sales and prof¬
point we
violation of a fundamental rule it motive:
perhaps get back nearer
of sound instalment credit selling.
There are a lot of jokes about ground.

the

prospects to

in

crease

finances- shows

and

intended to be, a measure

of

distribution

are

to

selling terms:

better

it; that to

who

of

to

will

men

entirely a thing of ideas, and the
object is to find ideas that, will

certainties

less

under pressure from

merely a substitute for
paying cash completely miss its
sales and profit significance. One
as

would result in

i

instalment

there

c r e

details

an

income,7 will

in

consumer

buyers

and

d i t-wise,

and

is

of

trained to sell

are

from

of the plan
by the character

of

sales

pushing credit sales.

merchandise

for

credit

for

management should be approached

of
the
merchandise
being sold;
automobile, a levertheless, there are some prin¬
refrigerator, a television or radio, ciples we can consider.
to have and to hold and to enjoy
One important thing to keep in
while they're being paid for, these mind is that a
financing service
same people seldom default on a
is not an over-the-counter prod¬
time-payment contract.
uct; not something a prospect can

with

Yet

save.

centives

"Credit Plan."

determined

are

formation

old

for credit that 71% of the used cars in this jects a growth up to $32
though, in addition, this country that sell for $500, or more, from the present level of around
is frequently supple¬ are bought on time; and in this $20 billion; another longer projec¬
mented by dealers with dollar in¬ large percentage of used car time tion comes up with a figure of

and

the second key fac¬

as¬

and

newer,

makes

inven¬

car

general

almost every
of condition.* A recent sur¬

kind
vey

the

a

motivation

Key Factor Is Good Credit Plan
We named

of

older

and

profit signifi¬
sales promotion.

credit

of

sortment

and

usually

are

mi

selling;

time.

on

But assuming that management

are

discipline,
the self-denial needed to exchange

for

than

credit, wept that their customers
didn't have money to buy because

history teaches is that few people
have

several industries

slower

were

volume

sold and used

car

tories

or¬

feAoiips in acknowledging
purchase of goods i on tifnd,
growth in population and family
u>

the

There is good motivation

goods—not

mobile industry in promoting

is fine theory, but practically

way

different

many years ago

a

market is three things—the prod¬

money to

promote by another, can
result in a loss of business, or a
redirection
of business; not the

purchase of

the

of

When salesmen

Cyrus Hall McCormick fathered
credit in action for the farmer in
1849 to

fair and reasonable.

sales

tested

cars; op the average twomust be sold for every

cars

new

and

trained

a

new

used

there

When

Very.

applied in principle to any credit
operation.
On proper management direc¬

employed, higher costs in

money

is

sell

every

.

meeting.

Important?
credit and

of

Thursday, February 12, 1953

..

know, is important in making it for sales credit development seems
possible for automobile dealers to great ana growing. Less hesitancy

an

important part of all current and
future
sales
activities
given a
place

.

thev future-potential

E. F.

formerly

Button & Co.

with,

Volume 177

Number 5194

.

.

The Commercial and Financial Chronicle

.

(711)
i

Jhe following statistical tabulations

Indications of Current
Business

Activity

week
Latest

Previous

Week

Week

AMERICAN IRON AND STEEL INSTITUTE:
!

'

Indicated

steel

Equivalent

operations

(percent ,oi

capacity»

AMERICAN PETROLEUM

tons)

(net

oil And condensate output—daily
ayerage
gallons each)

Crude

Gasoline

.

to

runs

stills—daily

Residual

fuel

ASSOCIATION

Feb. 15

2,226,000

"2,202,000

2,238,000

2,080,000

6,522,300
116,933,000

6,491,750
7,031,000

6,515,950
7,221,000

6,225,300

Jan. 31
Jan. 31

oil

OF

(bbls.)

___

at

...

AMERICAN

23,329,000

Revenue

freight received from connections

Total

U

S.

Private

Public

(number

of

23,154,000

24,306,000

21,566,000

2,952,000

2,759,000

2,975,000

2,662,000

10,535,000

11,121,000

10,955,000

9,866,000

Jan. 31

8,831,000

8,771,000

9,524,000

8,891,000

149,443,000

of

(no.

145,879,000

137,016,000

145,500,000

23,292,000

23,890,000

27,266,000

22,150,000

85,179,000

100,461.000

67,499,000

Jan. 31

46,356,000

46,918,000

49,459,000

39,242,000

Jan. 31

697,616

697,641

563,085

731,218

Jan. 31

666,479

664,328

511,981

670,314

cars).

Domestic

State

Bituminous

coal

lignite

and

coke

Feb.

5

453,422,000

135,062,000

86,935,000

Stocks

188,604,000

80,195,000

Unfilled

117,758,000

52,464,000

70,846,000

27,731,000

Feb.

5

170,078,000
118,427,000

Feb.

5

97,476,000

146,489,000
102,509,000

Feb.

5

20,951,000

43,980,000

EDISON

Electric output

+

100

AND

INDUSTRIAL)

steel

Pig iron

(per gross ton)

METAL

(E.

M.

&

tin

(New

Lead

(New

Lead

(St. Louis)

892,000

All

Jan, 31

110,200

"118,000

92,000

136,600

New

residential

New

nonresidential

.

86

"85

8i

84

'

■

.

;

"8,210,012

7,455,509

5

159

,

Total

162

163

134

4.376c

4.376c

4.131c

trFeb.

3

$55.26

$55.26

$55.26

$52.72

3

'

i.

*

$42.00

$42.00

$42.00

Government

—

—

Bonds
.«>

-v~

)r..

24.200c

24.200c

24.200c

'—••—-7—-

,

Group

—.

...

.

S.

Government

Bonds.;

Average corporate

1
v

34.925c

34.925c

34.425c

27.425c

121.500c

121.500c

121.500c

121.500c

4

13.500c

14.000c

14.750c

19.000c

Feb.

4

13.300c

13.800c

14.550c

18.800c

Feb.

4

11.500c

12.000c

Feb. lo

95.66

Feb. 10

108.34

:

Feb. 10
Feb. lo

Utilities

Group
Group

MOODY'S

COMMODITY

13.000c

19.500c

INDEX

P^PERBOARD

received

Production

112.19

113.31

114.85

Farm

110.52

110.70

111.81

113.12

Public

107.62

107.98

108.88

108.70

Railroad

103.30

103.97

103.64

Telephone and

106.21

106.92

106.39

Other

109.24

109.79

112.19

113.70

.

107.38

108.34

Feb. 10

111.07

111.25

•

2.81

3.26

2.80
3.05

3.14 ~

3.13

10

3.52

Feb. 10

3.38

Feb. lo

404.7

s

3.25

t

3.06

3.28

—-—

100

—

end

at

DRUG

of

period—

REPORTER

PRICE

-

|

2.79
3.20
J

All

3.07

AND

Odd-lot

sales

Number

of

by dealers

Number of shares
Dollar

.<

,

.,

i

1342,725

236,845
205,239

Jan. 31
Jan. 31

455,086

94

+66

85

462,564

1478,354

405,520

108.18

103.50

113.41

•

107.98

38,975

1,129,949
$53,153,912

Jan. 24

841,854

918,371

624,121

Jan. 24

$37,867,235

$39,017,000

$26,891,345
'

29,446

25,329

23,409
"

Without

710,123

'806,943

681,537

939,882

4,101

4,698

2,576

5,175

Number

of

—

STOCK

802,245

678,961

934,707

$28,710,584

$33,945,871

$27,115,753

$40,273,722

195,800

236,930

229,990

248,860

Jan- 24:

ROUND-LOT

Jan. 24

—

SALES

THE

ON

NEW

YORK

STOCK TRANSACTIONS

AQCOUNT OF MEMBERS

Round-lot
6ales

(SHARES):

ARD

Other

sales ">

------

__i—

TRANSACTIONS

FOR

-•

.

—

ACCOUNT

OF

195,800

23^930

229,900

248,860

i >,]:

'334,050

339,090

182,520

443,300

>

sales

Total

sales

Other

sales

•

—

..

Short

sales

Other

sales

initiated off the floor—
;

——

——

;

Total sales
'

——

—

,U.

_

S.

45

8

308*

6

724
■

'

>

657

47
„

-'

314

63
286

112

113

92

135

135

130

34

37

37

27

29

27

105

107

91

100

120

•90

53

55

13

14

12

56

62

62

5

5

5

109

*115

108

84

♦194

83

48

=

100)

consumers—-

customers

at

CLEANERS

(VACUUM

November

—

29,364,469

29,279,408

27,480,909

$527,279,900

$521,103,300

$488,494,500

48,349,466

48,239,396

46,708,035

249,032

254,297

230,263

'218,664

of

...

STAND¬

CLEANER

MANU¬

ASSN.)—Month of Dec.:
of units)

WASHERS

AND

IRONERS—

SIZE— (AMERICAN

HOME

ASSOCIA¬

16,300

$908,003,585
661,229,045

$985,214,968
707,482.556

$903,344,012

72.$2

71.81

74.14

$117,832,541

$139,823,853

$116,769,029

110,687,002

120,668,578

99,287,053

84,000,000

92,000,000

72,000,000

$275,000,000

$275,000,000

$275,000,000

267,402,058

267,391,155

259,775,389

48,176

53,969

37.753

$267,450,235

$267,445,125

$259,813,143

612,775

623,859

655,613

RAILROAD EARNINGS—CLASS I ROADS (AS¬
SOCIATION OF AMERICAN
of November:
Total

operating

revenues..

Total

operating

expenses

Net

Jan-17

Net income

RRs.)—Month

I—

ratio

Taxes

331,420

U.

'

'

railway operating income before charges
after charges (estimated)

812,320

956,120

883.400

172,860

152,140

188,300

Jan_ 17

709,010

1,054,710

786,700

730,260

Jan

870,480

1,227,570

938,840

9£8,560

Jan. 17

215,610

297,230

246,500

210.050

161,470

20.900

.

17

185,550

354.260 '

Jan'

i7

206,450-

•378,160

267,947

358,587

i7

-

23,900

Jan

Ja

•

,

6,500

15.800

258,940

241,100

265,440

256,900

407,353

376,628

44,020

58,420

30,440

346,110

413,249

362,937

669,730.462

STATUTORY DEBT LIMITATION

at

17

;

a

face

(OOO's

amount

omitted)-:

that

be

may

outstanding

time

any

OutstandingTotal

public

gross

Guaranteed

debt

obligations not

oyvned

by

the

Treasury
Total gross public debt and guaranteed

obligations
Deduct—other

gations

not

:

,

outstanding public debt obli¬
subject to debt limitation-

54,290
■*

Grand

457.427

390,130

471,609

393,377

1,296.377

1,708,727

1,609,973

226,390

255,i80

189,080

258.390

Balance

511,717
.

under

total

face

outstanding

amount

above

of

,

obligations,

$266,837,459

•_*«.»

$266,821,266 $259,£57,529

issuable

author ity._

8,162,540

8,178,733

15,842,470

' $267,450,235

$267,445,125

$250,813,143

5,688,668

6,064,343

$261,761,567

$26i,380,782

1,470,078

——,

1?

1,240,670

1,822,219

1,408,577

1,428,-787

—-T— Jan.

l7

1,467,060

2,077,399

1,597,657

1.687,177

DEPT.

GOVT.

Total

1,052,910

.

...

S.

As of Jan. 31
17

—

PRICES, NEW SERIES
LABOR — (1947-4D == 100):

41

196

46,779

8,593,880

Jan

WHOLESALE

45
226

74,370

8,925,300

Jan_ 17

—

____r

i

30

42

202

19,724

9,819,050

Jan. 17

Other sales

-

9

293,079

10,054,720

Total round-lot transactions for account of members—

.

'23

70,584

10,360,350

jan[

Total purchases
Short- sales

19

16,798

10,035,030

Jan. i7

Total sales

•

32

16

310,661

8,536,020

-Jan. 17
.

—-—.

Total purchases

"

.

—

sales

Other transactions

^

•

——-—

.

27

(units)—

8,875^010

initiated *>n the floor—

purchases

Short

Total

—

,,

transactions

25

(units)

Jan-1'

—Jan.'17

—

Total sales

Other

28

11

MEM¬

L——
—

33

11

Factory sales of dryers

325,320

235,670

1

VACUUM

SIZE

283,990

...

Other

31

32

Factory sales of ironcrs

.

of specialists in stocks in which registered—
purchases
Jan
sales

37

8

i

Factory sales of washers (units)

Transactions
Short

35

39

110

(OOO's omitted)
customers—month

ultimate

—

STANDARD

*

BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS:
Total

123

(FEDERAL RE-

LAUNDRY MANUFACTURERS'
TION)—Month of December:

He

qU

November

HOUSEHOLD

T'"1 qo'

:

J/n.17

;

127

.267

adjustment

ultimate

of

Operating

Total sales „i—

<

of

from

FACTURERS'

.

———.

_

SALES

Factory sales (number

sales-

Short

ROUND-LOT

706,022

Jan. 24

by dealers—

shares

ROUND-LOT

FOR

*

Jan.24

Jan. 24

"III

EXCHANGE AND

Total

'T

Jan. 24

—

i—

sales

Other

TOTAL

sales

—.——

and

seasonal

Number

by dealers—

shares—Total

44

119

33

public

November

32,777

Jan- 24

sales

58

of

HOUSEHOLD

Jan. 24

Round-lot purchases

•

21,368

142

Short

83

49

56

103

Adjusted for seasonal variations..

Month

32,199

29,455

32,635

:

107

49

304

service

ELECTRIC INSTITUTE:
Kilowatt-hour sales to ultimate

88

—

105

31

L___

SYSTEM—(J935Mi> Average
January:

Month

209

EDISON

23,321

sales

SERVE

187

103

enterprises.—
development

DEPARTMENT STORE

•'

133

Number of

other

187

275

water

Conservation

13

415

I

v

447.0

and

18
421

(__I

II

j_r

407.6

f299,914

6

building

56

19

411

685

405.4

202,039

.

;

Miscellaneous public

29,313

other

;

Sewer

123

6ales

70

3.37

25,706

Customers'

650

57

3.18

Jan. 24

Dollar value

865

2.97

Jan- 24

Round-lot

719

750

I

3.34

239,985

Jan. 24

sales

1,517

953

3.05

sales—n

sales

$2,174

1,789

826

3.21

sales

short

$2,513

1,623
!

3,10

3.53

short

shares—Total

$2,308

OF

millions):

3.26

3.24

3.51

other

of

(in

3.38

3.23

Customers'

Customers'

67,324

DEPT.

nonresidential building.—
Military and naval facilities
Highways

3.28

3.52

234,876

Jan. 24

—--—

—

"103,826

I

Other

Customers'
Number

•

1

—

value

186,222 *

78,363

;

Hospital and institutional

Revenue
.

287,882

"239,581

;

building

3.00

—

—

$541,428

"474,973

196,781

private..

Educational

*

Odd-lot purchases by dealers (customers' sales)—
Number of orders—Customers' total sales

-

.

___—

"$818,380

342,152

telegraph

Industrial

N.

(customers' purchases)

orders—

50,509

construction

Nonresidential

Y. STOCK
EXCHANGE-^SECURITIES EXCHANGE COMMISSION:
ON

32,255

utilities

3.17

.240,713

—Feb.

SPECIALISTS

45,264

$617,295

1—

2.91

STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODD-

DEALERS

84,909

21,901

3

;

public

81,769

90,756
83,149

institutional.

utilities

2.72

Jan. 31

94

and

78,563

77,295
86,987

construction

other

Public

'

«

Ja.i. 31

INDEX—

—

242,156,000
til, 759,000

—IllIIIIII

(nonfarm)

Miscellaneous

Residential

3.11

—

(tonsi

AND

AVERAGE

LOT

Hospital

ASSOCIATION:

activity

orders

PAINT

3,123,000

recreational

112.00

Feb. lo

—

and

96.68

-Feb. 10

(tons)

(tons)

Percentage of
Unfilled

+—

r

"250,686,000

3,641,000

Educational

All

NATIONAL
Orders

£

...

239,877,000

_IIIIIIII

109.97

v

F.eb. 10

".-Feb.

.-

S.

January

Nonhousekeeping
residential building

95.94

Feb. 10

■'

Public

11,297,000

alterations..

109.42

3.30

Industrials

and

95.79

Feb. 10

—

BaV~IIIIIIIIIII—III—IIZlIII—I—III—II

i

etc.-

of

103.52

.

Railroad Group

"12,212,000

construction

Additions

<

;

—

12,760,000

10,802,000

S.—

Warehouses, office and loft buildings
Stores, restaurants, and garages
Other nonresidential
buildings
Religious

4
4

106.21

Gro^p—

19,948,000

of Novem¬

Commercial

Feb.

103.80

Utilities

45,000

18,709,000

81,133

24.200c

Feb.

Feb. 10

Industrials

43,000

Industrial
4

Feb. 10

i

U.

building (nonfarm)_!
dwelling units.

New

•

Baa

Public

18,145,000

36,000

construction

Social

corporate.

188,149,000

19,562,000

VALUA¬

THE

CONSTRUCTION—U.

new

Private

$42.00

Feb.

MOODY'S BOND YIELD DAILY AVERAGES:

r

OF

——

Non

Feb.

,

206,340,000

202,044,000

(tons)-.

PERMIT

Residential

Railroad Group

1

period

AREAS

alterations,

BUILDING

*

4.376c

-

t
at—

8,150,534

3

!

Louis)

5,129,038

*.Fqb.

at

at

221,649,000

194,611,000
19,360,000

export

building construction

Additions,

*
.

York)

7

'

k

of

U. S. DEPT. OF
LABOR—Month
ber (OOO's omitted):

10,400,000

507,000

LABOR—Month

—_—

—

'

URBAN

7,695,000

QUOTATIONS):

,

Aa

,

IN

550,000

~

York) at

(East St.

Average

OIL,

at end

"9,210,000

.iFeb.

J.

214,007,000

(tons)

CONSTRUCTION

TION

MOODY'S BOND PRICES DAILY AVERAGES:

'

period

628,000

^Feb.

(per gross ton)

Electrolytic copper—
Domestic refinery at
Export refinery at—

U.

of

orders

BUILDING

A

•

lb.)

iper

PRICES

Straits

DUN

—

—

_

Finished

Scrap steel

.

end

,855,000

Feb.

BRADSTREET, INC.-,

Aaa

at

Jan. 31

Jan. 31

(in 000 kwh.)

(COMMERCIAL

IRON AGE COMPOSITE PRICES:

U. S.

(barrels)

ELECTRIC INSTITUTE:

FAILURES

Zinc

imports

Jan. 31

INDEX—FEDERAL RESERVE
=

11,660

zinc smelter output, all
grades (tons of
2,000 pounds)
Shipments (tons of 2,000 pounds)-—I—I—_

$167,130,000

Jl

.

SALES

AVERAGE

72,647

♦12,495

December:

$323,666,000

...

(tons)
STORE

SYSTEM—1041-40

76,882

10,920

AMERICAN ZINC
INSTITUTE, INC.—Month of

$599,911,000

'

DEPARTMENT

77,312

(barrels of 42 gal¬

oil

products imports (barrels).
Indicated consumption domestic and
(barrels)
Increase all stock (barrels)

OF MINES):

(tons)

(tons)..

crude

Refined

$288,505,000

—

Pennsylvania anthracite

oil

5

and municipal

.COAL OUTPUT .(U. S. BUREAU

Ago

INSTITUTE—Month

output (barrels).^
Natural gasoline output (barrels)
Benzol output (barrels)_

Feb.

:

.

Year

Month

Slab

construction
construction

Beehive

'

...

of that date:

Previous

November:

Crude

ENGINEERING

—

,of

PETROLEUM

Total domestic
production
lons each)

t

32,148,000

cars)

CONSTRUCTION

construction

Federal

,

•

NEWS-RECORD:

.

i

AMERICAN

RAILROADS:

Ireight loaded

ENGINEERING

Month

ALUMINUM (BUREAU OF MINES):
Production of primary aluminum in the U. S.
(in short tons)—Month of October
Stocks of aluminum (short
tons) end of Oct.

6,552,000

31

Jan. 31

Revenue

CIVIL

Ago
100.1

.

,

Ago
99.3

1—Jan.

are as

Latest'

"97.7

;

(bbls.)

of quotations,

ot

(bbls.)

average

in crises

or,

either for the

are

Year

93.7

Stocks at refinettes, bulk terminals, in transit, in pipe lines—
Finished and unfinished gasoline (bbls.) at—
—Jan. 31
Kerosene (bbls.) at
!
.Jan. 31
Distillate fuel oil (bbls.) at
Jan. 31

j.

Month

production and other figures for the

cover

Dates shown in first column

that date,

on

Feb. 15

Jan. 31

(bbls.)——;—

Residual fuel oil output

>

(bbls.

(bbls.)

output

Kerosene output (bbls.)
Distillate fuel oil output

'

month ended

INSTITUTE:

Crude

42

or

month available.

or

to—

Steel ingots and castings
,

latest week

39

•

UNITED

STATES

DIRECT

AND

GUARANTEED—(OOO's omitted):
As of Jan. 31-

General

OF

GROSS DEBT

fund

—

balance...

,

3,879,414

.

Commodity Group—
All

commodities

Farm

,

Net
3

Feb.

3

98.2

"99.4

101.1

Feb.

3

104.3

"104.6

104.0

93.6

"95.5

and fpods———.Feb.

3

112.7

"112.8

:

foods—

—

„•

"

AIL commodities

Fob.

——

products

Processed

other than

_—i.

farm

——

——-—:

109.3

"109.5

109.8.

97.1

112.9.

'

"RqvLsed "figure.
rIncludes 551.000 barrels of foreign, crude runs.' ?Based on new annual capacity- of 117,547,470 tons
'.'as of'Jan. 1, 1953 as against the Jan. 1,1952 basis of 108,58 7,670 tens. JEleven days ended Dec .31, 1952.




debt

Computed

•—

annual

rate.

-2.3617*

ZF-NC OXIDE (BUREAU OF
October:

Production

Shipments
Stocks

at

"Revised.

(short

tons)

(short

tons)

end of

month

2.3537>

$255,933,729
2.3117*

MINES)—Month of
...

»short

tDecrease—all

tons)

stocks.

*

15.979

14,633

15,578

17,613

1"

18,701

18,300

1.VJ 33

m

The Commercial and Financial Chronicle

*7i2>

Continued from page

Public

'

Utility

10

California Electric Power

California, and has a few customers in southwestern
Nevada which contribute about 3% of revenues. Electricity ac¬
southeastern

counts for about 83% of

"A Federal Reserve

system revenues, telephone business 11%,

County, California.

narrow,

County

Near the other end of the north and

revenues.

indicate

would

has

Board

^nd ^parentb^has,
rtonoraifv

wM,
lie

and
mainly in the western part of California. San Bernardino
(near Los Angeles) contributes about 75% of electric

this

Reserve

>

and

resumed
in

QhroptdH

ban^ng

the
won

"lattTnf theAgencies"

substantial

showing the company's service areas is long

The map

nnr

south transmission

time the longest high-tension wire in the world), are
the old mining towns of Tonopah and Goldfield—mining was the

sales, and exchanges of
government securities with prime
regard to the general business and
situation" although recog¬

credit

regions include a number of resort areas. The principal cities
Include San Bernardino (served jointly with Southern California

In his message to Congress last

geographical variations of the territory served give
rise to a considerable diversity in types of agricultural, industrial
and other loads. Farm activities include the growing of oranges,
lemons, dates, deciduous fruits, alfalfa and vegetables, together
with related packing, canning, processing and by-product opera¬
tions. Industrial activities include cement manufacture; chemical

principally the production of

soda ash, potash and

borax; and mining, including gold, silver, tungsten and
The

area

1951, and are at a higher level than at any time during World
There has been very rapid growth in population and industry

company's kilowatt-hour sales, which were 119% higher
in its electric revenues, which increased

in 1951 than in 1944, and

•3124% during the same period.
The company's earnings

record, based

on

shares outstanding

at the end of each year, has been as follows:

:

♦1952

-

1951

—

1950____^_i.

1949

920

54

1948

74

68

1947

77

earnings in 1951 were due to a severe drought.
in 1952 was due to continued growth, particularly
in the higher priced classes of service, a $700,000 rate increase,
-and a sharp reduction in power costs due to a plentiful supply
xtf water for hydro operations, plus new steam generating facili¬
poor

The recovery

Two

new

30.000 KW steam units

came

into operation in the

generating about 30% of all requirements and reducing

jsummer,

©utsidq purchases to

minimum.

a

(In

the

past,

considerable

has been purchased from the Hoover Dam, from Southern
etc.) A third steam unit (40,000 KW) at High.grove is scheduled for completion late in 1953.
power

California Edison,

Capitalization at the end of 1952 was approximately as follows:
Millions

Long Term Debt
Preferred

Percentage

$30

Stock

Common Stock Equity
Total

50%

10

17

19

33

$59

100%

Early last October the company sold 350,000 shares of common
£tock at 9%, and the two convertible preference stocks were
called for redemption November 17, which also increased the
ZMimber of

shares.

common

136,249

President Albert

Cage has indicated

shares

bonds may be

of additional common stock and $8,Q00,000
sold this spring. The new financing, together with

excellent line of bank credit, will carry the
company through
the middle of 1954, it is estimated.
,
,.
>■

an

1952 earnings on a pro forma basis

proposed new financing, would be 850
«guity ratio would be 30%.

after adjustment for the
a

share.

The

pro

forma

The company's common stock has been
selling recently on
the American Stock Exchange around 10y8 to
yield nearly 6%.

J. Earth Adds

Estabrook Adds

fSpecial to The Financial Chronicle)

to

(Special to The Financial Chronicle)

Montgomery, John

Street, members of the New York A. Nelson, Herman L
—

San

Francisco

Stock

changes.

cies1

consideration

econ¬

impor-

the

by

port-

folio manager is the growth of
p0pulation
and

tions

Educational

institu-

business

corporations,
of the reduced

to

•

earner

ft

the

Effective Jan. 26, the Merchants.
Bank in
Chicago, 111.*,

National

increased its capital from $600,000
to

$800,000

by

dividend

stock

a

of $200,000.

*
*
* ■ ' :
Under date of Jan. 28 the title
of the American National Bank of
.

,

Kalamilzoo, Mich. , was changed toAmerican National Bank &
Trust Co. oLKalamazoo.
.

R- ^juir, President- of Th<^

^ou?sv! e

^rust

>.

Company,

of

Lomsvdle
Ky , announces theelections of H. GWhittenbergand

Eavi£u?;+ R^1(?s *s 2ire<^03?v

m

SSTZTilSSt»ZS£"

realty
is faced with the refunding ownership of a home, an autonies.
large amounts of government mobile, and a television set, not
oS1™™ wl
obligations maturing in 1953.
as
luxuries, but as an' integral
member of
These maturities almost dictate part of normal American living. ri h Ri
cnr;n(rs. cnif rii.h ami
the adoption in the early months This objective view of the AmeriCreek Rid_
of the new Administration of an can
worker, of which political }
C]
b
M
whittenheri? is also,
orderly and far reaching refund- leadership is not unmindful, has
of {he
chaping
program.
Such a
program been1 greatly aided
by our sys- t
f
Associated
General
Conwould not necessarily mean long- tem
of consumer credit which trar+ors
Mr
RPVno]ris is a Vireterm bonds, but rather the exten- reached a record level of $23,975,- prPojdPnt in Chare? of the Gension of the short-term debt into 000,00(1 recently
This large vol- eral Sa]es Division and a Director.
ury

of

The Pendennit-

f, 8®

Schreiber

and

Stock

Exchanges.

fBpecial to The Financial Chronicle)

HARTFORD, Conn.—Joseph W.
tHrandola, David C. Nelson and
J.
j

associated

Phelan
with

have
i

Two With Waddell Reed
(Special to The Financial Chronicle)

become
o

r»

having

notes

manageable maturities.
historical comparison,

more

HANS AS GIT Y, Mo.—Robert O.

£ourid iheirin

bonds due

By way of by
over 30% to

viewed

been

has

some as

*0*° lonS-term

2o to 30 years.

ing went into intermediate maturities, none maturing beyond
1928, i.e. five to seven years. The
greatly increased size of the present Federal debt and the require-

i

R

Recent

of

is

RPvnold«? Metals

ajs0

a

Comnanv

of

Direct0r

Reynolds-

corporation, United States Foil
Company, Richmond Radiator Co..
Mutual

Trading

Corn

Reynolds-

<

Aluminum Co., Reynolds

Jamaica
Mines, Ltd., Caribbean Steamships

Co-> Reynold? Alloys Co. and Es~

Outlook

Business Outlook

Ap-

proximately 90% of that refund-

kimQ pie Corp

Re ig algQ

Di_

utterance

by the cap- rector of the Reynolds Mining;
tains of the electrical equipment, Corporation, Reynolds Sales Co.*.
chemical,
mail
order,
electric and the Reynolds Reduction Co..
appHance. and automobile indus- Mr. Reynolds is a Director of the•
tries
relative to business
pros- Louisville Chamber of Commerce,,

pects have been in a confident the Louisville Safety Council ana'
ments
of the Defense Program vein. Indeed some of them have the
Louisville
Chapter
of theundoubtedly will require a some- been positively optimistic.
For American Red Cross,
what different approach in formuillustration, an official of an out*
* . *
lating a broadscale refunding pro- standing chemical company asked
Seven promotions at the Trust,
gram.
Gf the chemical industry was not Company of Georgia at Atlanta
An

early indication of the probpresented in the maturity
on Feb. 15 of $8,858,000,000 which
will
be
met
with a
"package
deal"—including a one-year 214%

m is
lem

Indebtedness and

Certificate of

a

faced with over-production stated:
"It won't be over-produced for
100 years. Mavbe some particular
chemical will be, but we always
shift,
we
can
always
use
the
hydrocarbons which might go into

alcohol or
somewhere'. else.

five-year 10-month 2V2% Treas¬
ury Bond.
Analysis of the pres¬
ent ownership of
the maturing

ethyl

certificates,

I

billion

approximately

$3.7

held

by Federal Reserve
Banks, approximately $2.3 billion
owned by Commercial Banks, and
the remainder, approximately

wish

only

years

to

what

see

nated the inclusion in the "pack¬

age" of

a

10

even

or

15-year

a

Treasury Bond.
to

seems

be

little

ques-

terest rates will attend an

orderly

opportunity,
live

the

100

a

industry

do," while the head of a
large steel company recently contended steel capacity is not excessive—that

elimi¬

glycol

industry

announced by Marshall B.
Hall, President, following a recent
meeting of the bank's. Board of
Directors. Promoted were: Arthur •
F. Rees, III, and Robert M. Bray,.
to Assistant Secretary; Manon O,.
Kelly, George T. Lamb and John ;
S. Evans to Assistant Treasurer*.
and Raymond A. Boyer and Wilbam E. Reynolds to Assistant

were

Trust Officer,

will

ductionto 85%

quickly

The.

could

I

and

individuals,

ethylene

has great freedom of

$2.9 billion, held by corporations

not cut

in

decline

a

pro-

of capacity would

profits.

Cnmnin

'

.

v

.

.pi

u

Summarizing briefly it would
appear that with unspent Congres-

'

industrial

construction

and

1

:

.

Bank of California, N.A., of Saui
Francis-0

at

thp

annual

whS

has

bMn

meeting-

'

sional appropriations of $100,000,- Layton

for

\

Alfred B. Lay ton, Vice-Presi-dent, Director and member of theExecutive Committee of Crown i
Zellerbach Corp., was elected tothe Board of directors of 'The-

with

Crown

^ion

since

isoLteS'

Zellerbach
his

Corpora.:

graduation

from.

Treasury refunding program, fi- municipal improvements, and fa- sTanfOTd^WiversltyTn ^1924,"wasi
na»cing «f. detense requirements, vorable business prospects, not to
Vice-President of the firm
and a continuing need for capital mention a moderate rise in in- ?lefe<* V'ce
™
by mdustl\vterest rates and the probable in 1933. During World War II heT,

„

maintenance

Industrial Requirements
construction, which
rateof $28,-

T

-

.

.

,

,

..

...

Industrial
000,000,000
of

last

tion of
rate

the

fourth

quarter

gives every indica¬
continuing at a very high

in

sources

in

of

a

high

level -of served with the U. S. Navy and

dividend payments,

the manager
portfolio while ap¬
proaching his task with caution,
of

a

can

was

1953,

some

exoecting

only

informed
a

small

released

to inactive

trust

view 1953 with confidence.

Joins Gibbs & Co.
(Specip.l to The Financial Chronicle)

WORCESTER, Mass.
Morrow,

Jr.

is

now

—

Carl W.

connected

with Gibbs & Co., 507 Main Street.

duty iir

1946 with the rank of Commander^.

With Renyx Field

year,

Cooley & Com- Bauer and Roy A. Green have be- decline from last year's record
pftoy, .100 Pearl Street, members come affiliated with Waddell & figure.
According to Johns-Mantf !fee New York Stock Exchange. Reed, Inc., 1012 Baltimore Avenue, ville
Corporation the construction




credit

of

ume

implying some threat
our financial stability
Howof World War I debt matured m ever, a comparison with Dispos1921 to 1923, three to five years able
Income over an extended
after the end of that War.
Only period of years reveals interesting
about 10% of the early maturities and somewhat re-assuring ratios.

are

and Boston

Louisviuf

pgsident

Ex-^«isG.
Vero and Eve.
M 15
Werner
with Estabrook
& Co.,
State

Three With Cooley Co.

x

which must receive

tant

stabilize
the that th
and encourage the free United gtat

designed

economy

Street, members of the New York

f

omy

Staff

SAN FRANCISCO, Calif.-WilBOSTON, Mass.-Mary J. Barr,
item W. Henderson is now with Harry C. Black, Atherton E. CrowJ. Barth & Co., 404 Montgomery
eU, Vincent R.

HFUIiam

our

now keenly aware
stated
Uast;
birth rate of the depression years,
policy between the are
givjng much attention to the
Treasury and the Federal Reserve
implications of the large increase
Board have helped to encourage
in population in the last decade
henceforth,
I expect w^b j^s obvious need for
food,
that their single purpose shall be
shelter, clothing, and education.
to serve the whole nation by pollIt must ais°' be
remembered

There

—

of

President

the

bonds

89C

•■"Preliminary

The

that

element

Dire^torgof ?he |ock

War II.

^

..

.

contains several important military establishments,

Riverside, and Edwards Air Force Base at Muroc. Electric reve¬
nues from military establishments amounted to about $923,000 in

ties.

:

iron.

Including the Naval Ordnance Te6t Station at Inyokern, Norton
Air Force Base at San Bernardino, March Air Force Base near

in the

Another

government security market."
week

Present ^ Trust Maier,
Investment
As-

Population Growth

differences in

,

The wide

extraction,

01 everyday use.

chases,

nizing the desirability of "main¬
tainine orderly
orderlv conditions
conditions in
in ine
the
taming
taining
conditions

electronic

and

power,

P^tion of many commodities gtartand
Clarence
Maasbei g, Assistant Cashier. ,

system

original inception of the business. The desert areas now include
.a number of important industrial operations
with large power
demands while the mountain sections and the southeastern desert

Company), Palm Springs, etc.

electric

*
*
v
The directors of the Old National Bank In Evansville, lnd.„
announce the election of William,
A. Carson, Chairman; Walter A.
Schleehte, President; Melburn G,
Merges, Vice-President and Trust;
Officer; John D. Clarke, Jr., Vice-

equipment so necessary for mass umcer, Miss Bunnei

with the Open
Market Committee directing "pur-

line (at one

JEdison

the growth industries and the
public utilities, and looking to the
future, hardly anyone will question a continued demand for capital t0 supply telephone service,

political purposes from
House."

riearlv

Federal

These sections produce winter

vegetables, melons, and other products which require
Quantities of ice for shipment to Eastern markets.

Ka>

And Bankers

000 in 1953.

System ex-

the Treasury or the White

pany's electric service area. The company's Ice Division manu¬
factures and sells ice in certain farm areas of Imperial County
and Riverside

for

sure

the com¬

telegraph business principally in the northern part of

16

tional Bank, of New Britain, Conn*
became effective on Jan. 20,

ercising its functions in the money
These figures'bear out the curand credit system without pres- rent demand for capital funds,by

6%. Interstate Telegraph Company, a whollysubsidiary, is engaged in a rapidly growing telephone and

-and ice operations
owned

page

particularly since the Election, by industry in 1952 established a new through a $100,000 stock dividend,
reason of a plank in the Repub- record of $42,000,000,000 and may
whereby the capital was raised
lican platform advocating:
exceed that figure by $1,000,000,- from $600,000 to $700,000.

in parts of

electricity

from

News Aboai Banks

In 1953

Co. serves

Thursday, February- 12, 1953

.

Continued

California Electric Power Company

f

.

Problems of Tiust Investments

By OWEN ELY

)

.

(Special to The Financial Chronicle)

NEW

ORLEANS,

La.

—

Mrs,

Essie C. Lopez has been added to
the staff of Renyx,
Inc.

Field & Co.,

Volume 177

Number 5194

*

.

The Commercial and Financial Chronicle

.

(713)

.

that make
'

Tomorrow's

high,

on

also

or new

plays

tion. It is

the general

a par

in market

the West from further territorial

ac¬

surprising, however,

little unexpected news
improve the market has to contend
on
their previous
day's per¬ with. Somewhere along the
formance on subsequent
days, way market action forecasts

must rely more and more on

of these stocks fail to

Whyte

I consider it at least

a

the

conquest, Stalin is compelled to

fall back to reiterating the basic Marxist creed that the
capitalistic
countries are growing the seeds of their own destruction—and

market trend. If at least six how

Markets
Walter

a new

low, depending

4*

having his agents and sympathizers
as well as between, the borders

push dissention amongst us, within

of the Western democratic nations.

Whatever
doubt be of

his

merits

or

demerits

elsewhere, Freud

can

help here!

some

long before it be¬
tionable
market
to
be
in; comes public property. To
maybe a dangerous one. The evaluate it properly is some¬ Continued
§=By WALTER WHYTE =
jrom page 14
most I can expect then is that
thing else.
Last weekldawdled the
stocks I chose will keep
[The views expressed in this
through the averages trying hanging around the
original article do not necessarily at any
to
point out various land¬ purchase
price, and that time coincide with those of the

Says—

ques¬

news

Goals of Banking in 1953

marks
most

that

have

become

al¬

established in the past

few years.
You
may
read the

have

heard

or

expression that "the

market

lure for me.
Naturally unexpected news

Continued

test."

all

well with

could

one

the

now

This is

It

world

for

,

still

it goes.

New

more

highs

however,

in

'

don't

highs in stocks
it

new

is

'

in the

You

;

that

\

.

\

'•

might be interested to

discover that the
that

new

stocks

basic interests lie.

the

"tests"

same

averages

are

posed to undergo also

sup¬

fol¬

are

The
;

Crucial

Exit

Factors

.-.7

Party trying to get out.

;

Messrs Ernst and Loth contend that there
deter him from leaving this
evil,

which

are

the first place,
he is afraid .of the filthy blackmail of the
Party which threatens to write anonymous letters to the bosses so

for example,
daily price movements
then

and

quent performance you'll
You'll

where

see

a

new

high, properly
by your

man,

headlines (if it's

stock)

and

are

stock

a

upon

customer's

ism, by which the authors imply that if a person confesses and
error, he is nevertheless ruined forever.
Here

authors'

the

crucial

philosophy.

newspaper

important

an

neighbors
you're long of

your

aware

repentance

and

disillusioned

for

from

discernible

no

the stock backs

reason,

its

rarified

and either

reaction

and goes to

away

atmosphere

into

a

loggy

just backs

away

goes

or

sleep. Sometimes

it does both. '

The
into

stock

on

its

came

estab¬

lishment

of a new
high
disgusted with its

either

formance

loss,
next

and

get

out

are
per¬

at

a

sit through until the

or

forward

new;

performances

they've become almost
in the

common

How

aren't

to

caught

past few years.

guard against being
in such tides is ob¬

viously important.
I have

no

In fact I have
use a

no

system at all.

rule of thumb

gimmick

that I'll pass on to
you to
with as you see fit.

Hardly
there

isn't

a

day
at

consistent
itiation

this

passes

least 10

do

that

stocks




with

of

possible

salvation.

To

member

ease

who

the

wants

problem
to

among

field

does

soothe the

to

"Alcoholics

in

with the

the dipsos.

of
<*,

restablished.

Permitting banks to deduct

V. adequate amount for
income

fore

taxes

reserves

an

be¬

does

,

suggestion which

a

embraces

and to deduct reasonable

addition

its

to

with

we

Banks

permit
for

each
bad

purposes.

More

Themselves

It is

in

percentage banks

reserve

Should Depend

criteria

the

all

mentioned—to

just

selves

'

on

,

the public interest that

depend

more

upon

less upon

and

them¬

government.

overall

ceiling cn For
example, the Federal Deposit
the amount of the reserve.
The Insurance
Corporation has built
reserve
ceiling should be high a huge reserve fund to give
sup¬
enough to enable banks to- meet port to banking. Assessments have
conditions at a peak of financial been
reduced, but many bankers
need. A chain is only as strong as are
requesting further reduction.
debts

re¬

addicts

Anonymous"

& •'

bank to make the same

an

its weakest link.

a
publicity-less national commission,
attitude, to estimate the menace; and in¬

as

until

assets

are

a

to

believe

the

of

period

a

The

Here is

non-

rejoin

kets

.

reserves

propose

British

"Communists Anonymous"

a

ideological

errant

If

banks

sufficiently

are

encour¬

-

The American Bankers Associa¬

studying formulas and
with the Treasury De¬
partment
toward
an
adequate,
is

tion

aged

to build adequate reserve
funds for themselves, future as¬

working

sessments

workable solution,

more

could

be

eliminated.

even

reduced

or

Thus,

in one
banks could be depend¬

way,

'

A

In

Soft Luxurious

Approach?

v

their

peasement
are

committees.

philosophy of considering neurotic therapy and
as
the desirable guide to the public's attitude,
in

sharp opposition to

our

ap¬

our

Congressional investigating

Thus the subcommittee of the Senate's Committee

on

Internal

Security maintains that this soft attitude, playing down
police action, does' not realistically combat the danger of a
ruthless enemy in this climactic crisis in our, civilization. Robert
Morris, special counsel to the former "McCarran Committee," elo¬
quently and quite reasonably complains of softness toward con¬
spirators who are selling us out, as by giving the enemy our

ajtpomic

secrets.

Similarly, merely recognizing and catering to the foibles of the
deviationists who have infiltrated our labor unions, or
teachers who hide behind the Constitution's Fifth Amendment to
refuse to inform legally constituted authorities whether
they are
Communists or not, seems quite far-fetched.
But whatever the

shortcomings of the Ernst-Loth-Freud con¬
fessional approach, and whether or not it
over-emphasizes the
neurosis phases as a single-cause explanation of a complex and
varied process; the authors in
for

the

any event deserve kudos, not only
trail-blazing enlightenment in the psychological areas,
their un-hysterical treatment of the domestic Communist-

The

first

additions

is whether

or

lic interest.

^epochal crisis obstructing

our very

survival in any

lifts this work to pragmatic importance above the current

politics

(as

PSYCHOANALYSIS

AND

POLITICS

Dealing with the Communist in
is

our

the standpoint

E.

midst with all reasonable

particularly important now when, with the Kremlin's
military apparently at last being "contained," that is, stopped by

government.

upon

again stress

reserves

banking.

are

a

They

that

"must"
are

■

adequate
for

sound

the most logi¬

public generally, the eco¬ cal form of insurance for a sus¬
stability of the nation is tained banking structure.
That
an objective of high priority. The
banking stands as a bulwark in all
existence
of
adequate
reserves periods is definitely in the public
during periods of active business interest.
,

serve

to

protect the prosperity of

nation.

a

the

lessen

-could

Reserves

frankly today is so that you may
and help raise know about some of the current
periods of recession. objectives of the American Bank¬

shock

the valleys in

When I started out in the bank¬

business,

ing

much
of

a

it

I

the

of

bank

ultimate

usefulness

dependent on how
withstand
depressions.

The merits of

cided

taught that

was

was

could

not

banker

a

alone

on

were

de¬

what he did

in good

times but on how he pre¬
pared for rough periods that might
be ahead. A bank's great strength
lies

in

its

standing

ability to

than-ever.

engineer
which

can

My purpose in talking to you so

also

through

go

tomers, and emerge with greater

R.

We

nomic

of

Money-Kyrle).
measures

not it is in the pub¬

From

case

mass

by

reserve

a

tough times, look after the legiti¬
mate
needs of dependable cus¬

parlor-psychoanalyses luxuriating in all fields from art to music
to

to

ing less

the

of

menace.

The

justification for tax-

deductible

emotional

but for

infallible system.

jobs in

greater ability to write off

frozen

ple in order to encourage its adop¬
amounts for income tax
tion by all banks.
\
'»

the

and

spectable society, and thereby purportedly put the American Com¬
a year's time, the authors
would,'
like the Catholic Church with sinners, forgive and
help and re¬
habilitate the rank-and-filers, rescuing them from
being.lost sheep,
unwanted in any fold.

permits

wave

them to get out even or at a
small profit
Such

of the book

have

not; give
same
formula should
all banks since they them an unfair advantage over
other corporations.
Other
corpo¬
operate under the same economic
rations under the existing statutes
.conditions.
are permitted to create bad debt
(5) The formula should be sim¬

munist Party out of business in

authors

buyers who

new

the

theme

over

^

(4)

They insist that 90% of the Commies under

rank-and-file

They further

Then,

controversial

gradually

apply

sensitive areas; but only if the community adopts the
position that
there is no such thing in life as
sinning without the chance for

it.

I

is

can

existing statutory law.,

years.

admits his

30 years of age can be sucked out of the movement for

commented

who

see

mean.

made-

prevent further economic security. When this is overcome, it
is contended, they then face the dire threat of so-called
McCarthy-

it with subse¬

compare

what I

to

this

,

In

as

stock list,
and vcheck its

that

up

two main factors

back

your own

,

^ "

stealthy organization.

Some

of the opin¬
be done under

are

.

orderly mar¬
The captain
In order to contribute to the
strong boat at sea isn't pan¬
stability of the banking system, icky in a storm.
The creation of reserves of this
certain
basic
guides should be
considered in the design of an type does not give banks any tax
advantage in the long term. The
adequate regulation.
tax payment is merely deferred
(1) 'The reserve must be large
because losses are charged to the
enough to do a complete job—
reserve.
This makes
for
more
covering losses that tend "to be
regularity in tax payment.; Just
concentrated in poor years. • •
as
any
businessman depreciates
(2) The reserve should be based his fixed assets over a
period of
upon loss possibilities of the fu¬
years, so all bankers should pro¬
ture
with
due
consideration
to
vide "depreciation reserves" for
losses of the past.
''
their loan portfolios over a period
,W
(3) The reserve must be built of years.
'

complete turn-over of the Party occurs in about three years;
and, the authors claim, the average member spends about a fourth

of his time in the

and "simplified.

exam¬

their job is tn

as

impractical. protect

and

sources

You can't blame the

iners too much

in

A

lowed by stocks. If you'll
go
over

depositors.
The way to
meet the situation is to encourage
banks to build reserves so they

unworkable

the

comes from middle and upper
middle class income homes and consists of
boys and girls who have
been well educated. There are
surprisingly few manual workers
and the movement does not invite the
physically coordinated; as
shown by the fact that there- are
very few members who play
baseball or football in college.

all stocks.

—

heaped onto the fire of depres¬

it

broadened

joining is 18 to 23. The membership

averages,

mean

be

sions.

informed

-

Other phases of the findings of a more factual
nature show
that about 700,000 Americans have
joined and left the Communist
Party and that this is a youth movement, since the peak age for

highs,

It is believed

that many banks have not adopted
the formula because they believed
The present regulation should be

Population Coverage

—

so

the present formula.

ion

Highs"
thereby bringing in more
new
buyers, who in turn
and

a

substituted.

Communist under every

a

.

^'Market Makes New

create

It is the firm belief of the ing authorities, whose job it i& to*
Bankers
Association protect the depositor, would be

of loans that could not:
moije realistic, workable, critical
equitable formula should be clean up promptly. Many bankers
would
feel
obliged to press some
Forty-five per cent
of all insured commercial banks deserving customers for early liq¬
have established reserves under uidation. In this way, fuel would

•..

"While it is true that there is not

good,
headlines —

exciting

that

bed," the authors conclude, "the Freudians would have a good
deal of justification for the claim that there is
a bed under the
basic emotional motivation of
every Communist." ''. i
.; ;
'
'

ad-

many

makes

the

American

,

,

And

5

in

and

go out and

thought and has
fierents.
even

effort

prostitutes among Party members than among non-Communists
of the same age background and marital
status. Promiscuity and
casual amours are verboten because of the
dangers of divulging
secrets.
Oedipus-like jealousy and hatred of father or mother,
substitution of Father Stalin, and fantasies of one's own
unattraction constitute prime motivation for,
joining the Party.
,
•.

comfortable

a

merit

and was an that can withstand any period o£
right direction, but stringency. Things that we pre¬
several
basic
deficiencies
have pare for often do not happen.
been disclosed through its use.
With the present low capitalThe present regulation for es¬ deposit ratio of banks, if a de~
tablishing loss reserves is inade¬ pression should strike, the bank¬

as

to

safely buy stocks.
;

presented

are

those of the author only.]

Observations

theory being that
averages had nego¬
previous high point

a

was

and

page

They

quate.

The
the

tiated

jrom

Chronicle.

had

successfully (or
unsuccessfully) passed its
once

considerable

doesn't have any

must

Just

design

a

as

an

bridge

weather any stress and

ers

Association; also, that, through
contacts, you can help

your many

these

with
We

reduced
our

plans.

believe
and

that
the

taxes

fiscal

must be

affairs of

government placed on
basis.

a more

sound

We favoi- single taxation for all
corporations, including banks.
We
excess

urge

the elimination of the

profits tax.

We will press for the establish¬
ment

of

an

adequate

reserve

foe

losses.
All

the

of

these

public

are

interest.

definitely
Your

ill

coura¬

geous support of these efforts wilt
strain, bankers must be engineers further enhance the stature of

in

designing

a

banking structure banking in this country.

The Commercial and Financial Chronicle
42

(714)

.

.

Thursday, February 12, 1953

.

l

* INDICATES

Securities Now
^ Airmen's Enterprises, lnc.r Kansas City, Mo.
Feb. 6 (letter of notification) 25,000 shares of class A
common stock.
Price—At par ($10 per share). Proceeds

equipment. Office—1415 Com¬
Bldg., Kansas City, Mo. Underwriter—None.

—To acquire
merce

office and

^ American Acceptance Corp., St. Petersburg, Fla.
Jan. 29 (letter of notification) 1,990 shares of 6% cumu¬
lative preferred stock; $25,000 of 7% collateral notes;
and 78,400 shares of class A common stock. Price—For
prefererd, $20 per share; for notes, at par; and for com¬
mon, $3 per share. Proceeds—To expand business. Office
—300 Third Ave., North, St. Petersburg, Fla.
Under¬
writer—None.

Kansas City, Mo.

American Alloys Corp.,
Dec. 15
stock.

(letter of notification) 1,000 shares of preferred
Price—At par ($10 per share).
Proceeds—For

Underwriter—McDonald-Evans & Co.,

working capital.
Kansas City, Mo.

in Registration
(letter of notification) 1,000,000 shares of class
B assessable stock. Price—10 cents per share.
Proceeds

—For

Feb. 6 filed 2,000,000

Corp.,

shares of capital stock. Price — At
Underwriter—Lord,

5%% convertible sink¬
ing fund mortgage bonds due Nov. 1, 1962, to be offered
for subscription by common' stockholders at the rate
of $100 of bonds for each 28 shares of stock held (for
a
14-day standby). Certain stockholders have waived
their rights. Price—At par. Proceeds—To repay $1,014,500 of outstanding notes and for drilling expenses and
working capital.
Underwriters — Dallas Rupe & Son.
Dallas, Texas; Carl M. Loeb, Rhoades & Co., New York;
and Straus, Blosser & McDowell, Chicago, 111. Offering
—Postponed temporarily.

Pipeline Producers, Inc.
Jan. 5 (letter of notification) 599,000 shares of common
stock (par one cent). Price—50 cents per share. Proceeds
—To drill wells. Office—Room 308, Texas Eastern Bldg.,

Atlanta

Feb.

Underwriter—W. C. Doehler Co., Jersey

selling stockholders. Underwriter—The First Boston

filed

9

and general

$10,000,000 of first

mortgage

Proceeds—To refund

bonds, series U, due March 1, 1983.

Underwriters

ding.
fin

share for each

10

(par $10)
stockholders at rate of

shares held.

Price

—

To be

supplied by amendment. Proceeds—To repay bank loans
issued in connection with company's construction pro¬

&

competitive bid¬

determined by

be

To

—

Probable bidders—Halsey, Stuart & Co. Inc.; Cof¬

Underwriter—None.

■At Charter Oil Co., Ltd., Calgary, Alta. (3/3-5)
Feb. 10 filed 900,000 shares of capital stock (par

Price—To be supplied by amendment. Pro

ceeds—For

expansion

Co., both of New York.

if Cherry Creek Tungsten Mining Corp.
21 (letter of notification) 130,000 shares of capita
Price—At par ($1 per share). Proceeds—To ac

Jan.

stock.

601, East

quire properties and machinery. Office—Suite
man
Bldg., Boise, Idaho. Underwriter—None.

if Cheyenne Oil Ventures, Inc., Denver, Colo.
Feb. 5 (letter of notification) 600,000 shares of commo
(par one cent). Price—10 cents per

stock

share. Proceed

Office—Suite 702-704 Ernest
Bldg., Denver, 2, Colo. Underwriter—None.

drilling expenses.

if Cincinnati Fund, Inc., Cincinnati, Ohio
*
Feb. 9 filed 10,000 shares of capital stock (par $1). Pric
—At market. Proceeds—For investment.
Underwriter
None. *
•

■

Inc., New York
$2,000,000 of 4% convertible debentures

Cinerama,

Feb. 4 filed

195&

Blyth & Co. Inc. and Kidder, Peabody & Co.

(jointly);

For

Lynch, Pierce, Fenner & Beane and White, Weld

Underwriters—Lehma

program.

Brothers and Bear, Stearns &

(jointly);

Merrill

$1

Canadian).

Corp.

Burr, Inc. and The First Boston

Co., St. Louis, Mo.
13,000 shares of commo

Price—$18 per share.
Proceeds—For improve
Office—5221 Natural Bridge Blvd., St. Louis, Mo

Cranmer
Feb.

ISSUE

10.

(letter of notification)

22

Jan.

(3/10)

^Central Maine Power Co.

outstanding short-term notes and for new construction.

Gas

March

on

—For

Corp., New York.

to be offered to present common
new

filed

4

Light Co. (3/4-5)
Feb. 11 filed 80,255 shares of common stock
one

Co., Niagara Falls, N. Y. (2/26)
271,940 shares of common stock (par $5).
supplied by amendment. Proceeds—To cer¬

REVISED

Central States Paper & Bag

ments.

Byrd OH Corp., Dallas, Tex.

Price—To be

ceived

stock.

Oct. 22 filed $1,750,000 of 10-year

tain

York.

American

Shreveport, La.
City, N. J.

Underwriter—Standard Securities

Wash.

Spokane,

ITEMS

&

Bros.

6485 N. W. St. Helens

—

Carborundum

Proceeds—For investment.

Abbett & Co., New

Office

mining expenses.

Road, Portland, Ore.

• American Business Shares, Inc., N. Y.
market.

12

PREVIOUS

(jointly): Harriman Ripley & Co., Inc.; Salomon
Hutzler.
Bids—Tentatively expected to be re¬

Co.

&

Portland, Ore.

Bunker-Chance Mining Co.,
Jan.

•

ADDITIONS

SINCE

du

JSfice—At 100% of principal amount. Proceeds
working capital. Underwriter—Gearhart & Otis* Inc

New

York; and White & Co., St.

Louis, Mo.

Underwriters—The First Boston Corp., New York;
and Courts & Co. and The Robinson-Humphrey Co., Inc.,

gram.

NEW ISSUE CALENDER

both of

Atlanta, Ga.

•

Banking Corp., Philadelphia, Pa.
(letter of notification) 29,000 shares of 6% cum¬

Automobile

Jan. 15

■

ulative preferred

stock, series A, of which a maximum
of 15,927 shares were offered on Jan. 27 first for sub¬

scription
of

by class A

and

(with

English Oil

oversubscription privilege); rights to expire on Feb. 26.
Price—At

($10

par

share).

per

Proceeds—To

(J.

increase

Kuch &
•

Properties,

Inc.

(2/20)

Proceeds

—

To defray cost

Con.

(Bids

Common

the warrants
and, if there is excess, for working capital. Business—
Real estate. Office—510 Baker Bldg., Minneapolis, Minn.

Iowa Southern Utilities Co

Underwriter—N one.

Lehman

(Bids

_

noon

-r-

-

-Bonds

EST)

(bids

Common

(Bids

'

(Bids

■

March

—

Peabody

Co., New York.

stock

(par five cents).

Price—25 cents

per

Illinois

equipment.
ver, Colo.

Baker

Resort

Airlines,
(Offering

cents

share.

per

Oils

Ltd.,

Carborundum

common

Brunner

To be named by amendment.

(Bids

q

Southern Co.

(Bids

Sachs

to

&

March

Charter

Oil

(Bids
..

New

:

"

'

to

"(Bids

(The

First

St

At

......Common
St

Co.;

and

be

one

place

Philadelphia




San Francisco

Cleveland

7,

1953

to

all

offices

Baird

St

March 9,
Arizona Public Service Co
(The

Private IVires

W.

Fall

First

River
•

*

Boston

Electric

Corp.

Co.,

II

Inc.)

9, 1953

—.Bonds
11

a.m.

Blyth
EST)

cost thru one

your

EST)

medium, the Chicago

To

give

St

Co.,

Inc.)

Bonds

Tribune, you(c

issues before both investment markets—professio

your

.:•>•;>

.

.

offerings the widest circulation in the multibilli

Chicago market, advertise in the newspaper that

is* t

leading business and financial publication of the midwest.
For facts that show how you can get more from your advert
ing, call your agency or a Tribune

Common*

and

a.m.

Common

1953

Light Co

(Bids

EST)

buyers plus the general investing public..

invited)

dollar

(Robert

a.m.

—.Preferred

4, 1953

March

Chicago

Bonds
11

EST)

Lake Superior District Power Co

Pittsburgh

1953

be- invited)

Corp.;. Courts

to

12,

Co.)

The Robinson-Humphrey Co., Inc.)
New York Central RR.——
Equip Trust Ctfs.

(Bids

EST)

__rBonds

Co

Boston

a.m.

Common
Stearns

Bear,

noon

March
Atlanta Gas Light

„

Common
11

Co."—
(Bids

England Power Co.—i—
■

-

15, 1953

June

Power

3, 1953

and

Bonjs

Inc

invited)

Co
(Bids

Gulf

Indianapolis Power & Light Co
:

Power

Common

_

Brothers

be

invited)

be

Co., Ltd

(Lehman

invited)

Service

May
Alabama

(Peter W. Spiess Co.)
x

-

——

Co.)

Texas Oil Exploration Co

writer—None.

be

to

(Bids

1953
Central RR. of New Jersey.
-Equip. Trust Ctfs.

(letter of notification) 15,000 shares of common
(par $1). Price—At market (about $5.37% per
share). Proceeds—To improve plant and for new ma¬
chinery. Office—1821 Broad St., Utica, N. Y. Under¬

Bonds
>

Debentures

March 2,

stock

invited)
invited)

Bonds & Preferred

April

,

be

to

Public

:..Common

Robbins, Inc
(Goldman,

Jan. 26

Boston

Orleans

New

Curtis)

&

)
.—Bonds

April 14, 1953

Common
Corp.)

Merrill

McKesson

'

April 13, 1953

1953

-

be

to
to

Electric Ser. Co

Texas

to stockholders—underwriters may include
Lynch, Pierce, Fenner & Beane; First Boston*
Corp.; Lehman Brothers; and Paine, Webber, Jackson

(par $1).

Common

invited)

Light Co

(Bids

(Offering

stock

Manufacturing Co.

New York

Power &

Bonds

Maryland Casualty Co.—_

Price—Approximately 64.48 cents per share. Proceeds—
To^ acquire leases and for corporate purposes. Under¬
writer—None.

(Eids

Florida

EST)

Boston

First

be

to

California Electric Power Co

1

underwriting)

Co.
(The

Toronto, Canada

Sept. 25 filed 1,000,000 shares of

-■

_*

February 26,

930 Seventeenth St., Denver, Colo.

Bristol

Common

(Bids

Proceeds—For

1953

31,

April 7, 1953

February 25, 1953

Office—702 Ernest and Cranmer Bldg.,
Underwriter—None.

expenses.

1953

Common

noon

' '

.

—Common

stockholders—no underwriter)

(Eids

stockholders—no

(Bids

r-

California Electric Power Co

CST)

Inc
to

St Co.)

Barney

'

underwriting)

Maine Central RR;

(par 10 cents) to be offered first for subscription
by stockholders at rate of one new share for each nine
Price—25

noon

**

Common

Electric Co

27, 1953

March

Equip. Trust Ctfs.

.

(No

stock

drilling

(Offering to

Co.)

February 20,
Properties, Inc

if Big Horn-Powder River Corp., Denver, Colo.
Jan. 30 (letter of notification) 565,220 shares of common

held.

RR
(Bids

Underwriter—E. I. Shelley Co., Den¬

new

Central

com¬

share.

Proceeds—To repay notes, and for drilling expenses and

shares

<fc

1953

Merritt-Chapman & Scott Corp.-

by Kidder,

February 19, 1953

Big Basin Oil, Inc., Holyoke, Colo.
Dec. 8 (letter of notification) 1,100,000 shares of
mon

...Common

(Offering. to stockholders—underwritten

EST)

a.m.

25,

be Smith,

(May

Bonds

EST)

a.m.

11

4

„

Southern Indiana Gas &

Brothers)

11

-.Bonds & Preferred

March

Niagara Mohawk Power Corp

Bonds

be invited)

to

'
<

South Carolina Electric & Gas Co

,,

24, 1953

Georgia Power Co
1

Corp.
(Lehman

Corp., Cleveland, Ohio
Jan. 27 (letter of notification) 300,000 shares of common
stock. Price
At par ($1 per share). Proceeds — For
equipment and working capital. Office — 1302 Ontario
St., Cleveland 13, Ohio. Underwriter—James H. Price &

-•

Bonds

invited)

be

.

February 18, 1953

Bi-Metals

to

Dallas Power & Light Co
.

_ -

-Bonds

Light Co

March

Bonds
-

1953

invited)

be

to

&

Power

*

lUft.irt. EST)

(Bids

Mississippi

(Bids

Co.
A

of deferred obligations issued pursuant to

•

Co.)

February 17, 1953
of New York, Inc

Edison

of making payment

invited)

Superior District Power Co

Lake

EST)

noon

Bonds

be

to

March 17,

Niagara Mohawk Power Corp

Jan. 26 filed 5,181 shares of common stock (par $1) and
"deferred• obligations", to pay an aggregate of $333,492.75.

(Bids

Common^
.-.Preferred

(Bids

Bonds

i___

be invited)

to

Electric Co

Hogle & Co)

(Dittmar &

Co., both of Philadelphia, Pa.

Baker

A.

Maine Power Co
(Bids

Frito Co.—

working capital. Underwriter—Bioren & Co., and H. G.

10, 1953

March

'

,'^c-

Nafragansett

February 16, 1953
Co.——

an

f' i

Central

Dillon & Co.)

(Eastman,

stockholders at rate

comomn

share for each five old shares held

one new

February 13, 1953
Stores, Inc
—Debentures

Food Fair

representative.

-

CHICAGO TRIBUNE
Tlte Tribune girts to

reports the largest

each day's market tables and

circulation given them in America.

.

I

r

v

Volume 177

Number 5194

.

.

The Commercial and Financial
Chronicle

.

43

(715)
Cade

Products Corp., Philadelphia, Pa.
shares of 6% cumulative preferred
(par $l)/and 255,000 shares of common stock
(no
par—stated value $1) to be sold in units of two shares
Dec.

1

★

filed. 500,000

of

—

Company intends to offer securities
public offering.

★ Franklin Life Insurance Co.

-

(par $4).
per
share). ;Proceeds—To.Allen & Co., New York. OfficeFranklin Life Blag.,
Springfield,111. Underwriter—None.

..

Frito Co.,
Jan. 26 filed
stock (par

(letter bf notification) 1,500 shares of
cumulative sinking fund preferred
stock, series A.
—At par ($100 per

share).

tal

5%%
Price

Proceeds—For working capi¬

ucts.

of

convertible

preferred
offered

Underwriter—Dittmar

& Co., San
Antonio, Tex.
Co., Hartford, Conn.
Jan. 29 (letter of
notification) 3,000 shares of preferred
stock. Price—At par
($100 per share). Proceeds
For
working capital. Office—3580 Main St.,
Hartford, Conn.
Underwriter—None.

Fuller Brush

—

repay

$22,000,000 bank loans and the balance to* reimburse the
treasury, in part, for expenditures made in connection
company's

share

ceeds—For expansion of business and
general corporate
purposes. Business—Manufacture and sale of food
prod¬

Underwriter—Wachob-Bender Corp., Omaha;- Neb.
Consolidated Edison Co. of New
York, Inc. (2/17)
Jan. 16 filed $40,000,000 of first and
refunding mortgage
bonds, series I, due Feb. 1, 1983.
Proceeds—Tof

with

115,000

$7.50), of which 85,000 shares will be

—

26

ic Gem Monazite Mines, Inc.,
Bdise, Ida.
Jan. 29 (letter oi
notification) 1,000,000 shares of com¬
mon stock.
Price
'25 cents ■per share.
Proceeds—For

construction

program. ^Underwriters—
by competitive bidding. ; Probable
bidders: Halsey, Stuart & Co.
Inc.; Morgan Stanley &
Co.; The First Boston Corp. Bids-^To be received
up to
11. a.m. (EST) on Feb. 17.
^--VW

drilling expenses;; Office
Ida. Uhderwriter—None.

Coronado Copper Mines
Corp. \T :
(letter of notification) 299,97Q shares of common
stock (par 10 cents);,
Price—$1 per share. Proceeds—

Coi, Ltd., Nassau
$1,350,900 20-year 6% first mortgage conver¬
tible debentures
due/March, 1973, and 1;565,000 shares

To

be

determined

•

,

,

.

..

—

215

McCarty Bldg., Boise,

Grand Bahama

Feb. 3 filed

Jan. 23

of

class A stock (par 10
leases, for exploration expenses, to repay
cents). Price—Par for deben¬
working capital. Office—100 West lOtlr tures'and $1 per share for stock. Proceeds
For new
St.s Wilmington, Del.; Underwriter—Charles J.
jv-construction.
Business
—
Hotel and land development.
'Maggio,
Underwriter—Gearhart & Otis, Inc., New York.
Inc., New York.
•
"v

To

acquire

loans

and

for

—

Dantz Run

V

Development

Feb. 3

(letter of notification) 950 non-assessable
common
shares. Price--At ,par>; ($100
per share).: Proceeds-~For
drilling for oil and gas and for acquisition and sale of
oil and gas' leases.
Underwriter—None.

Offices—9

Main

:1''

holders

.Detroit Hardware

of

the

(approximately $3.25
Proceeds—To Detroit Trust Co., co-executor

Estate

of

Fred

Schrey.
Roney & Co., Detroit, Mich.

Underwriterr-Wm.

one

share

new

O.

Box

1771,

Dallas,

1952, on a pro rata basis; rights to ex¬
28, 1953: The offering will include 50,000
directors, officers and employees of the com¬

for services.

pire

working capital..Underwriter—
Stuyvesant F. Morris, Jr., & Co., New York.

Econo Products
Co., Bnq.
(letter of notification) 300,000 shares of common
stock (par 10
cents). Price—$1 per share. Proceeds—For
Jan. 8

expansion and working capital. Office
17 State St.,
New York. Underwriter—James T.
Dewitt & Co., Inc.,
Washington, D. C.
—

Ekco Oil

Co., Philadelphia, Pa.
Dec. 4 (letter of
notification) 99,000 shares of common
stock (par one cent).
Price—$3 per share.; Proceeds—

Underwriter—Hopper,

on

Feb.

and to

pany

and

Soliday & Co., Philadelphia, Pa.

of

of record Dec.
22,

^

To acquire leases and drill wells.

basis

Gyrodyne Co. o# America, Inc.
13 filed 350,000 scares of class A
common
stock
(par $1), to be offered for subscription
by stockholders

For

films

on

Nov.

C.

shares to

of

11

held; rights to expire on or about
Price—$50 per share. Proceeds—To increase

if Doug Allan TV & Film Productions, Inc.
Feb. 4 (letter of
notification) 150,000 shares of common
stock (par 50 cents).
Price—$1 per share. Proceeds—
cost

Feb.

certain

Price

individuals

$5.75

—

copter.

Office—St.

and

firms

share.

per

engineering and construction
\

in payment
Proceeds — For

of

prototype coaxial heli¬
L. I., N. Y. Underwriter—

James,

None.

to

be

reserved

for

officers

and

properties and interests therein. Price—At
par
Proceeds—For acquisition of additional

share).
ties

and

Lake

leases.

Underwriter—J. A.

Hogle &

($1 per
proper¬

Co.,

Salt

City, Utah.

Erie Meter
Systems, Inc.,
9
(letter of notification)

Erie, Pa.
$300,000 of 15-year 6%
fund debentures dated Nov."
1, 1952 and due

Dec.

sinking
Nov.

1, 1967.

Price—At par and accrued interest. Pro¬
ceeds—To repay bank loans and for
working capital.
Office—1602 Wagner
Avenue, Erie, Pa. Underwriter—
None.
Smith & Root, Erie,
Pa., will act as distributor.

Minneapolis, Minn.

determined by competitive bidding.
Halsey, Stuart & Co. Inc.; The First
Boston Corp.; Kidder, Peabody & Co.; Lehman Brothers,
Bear, Stearns & Co., Equitable Securities Corp., and
Salomon Bros. & Hutzler (jointly); White, Weld & Co.
Bids—Scheduled to be received up to noon (EST) on
Feb.

due

March

1,

1973.

Price—At

par

(in

—

Hemisphere Western Oil Co.
Dec. 3 (letter of
notification) 1,196,000 shares of

Israel Securities Corp.,
Israel

(letter of notification'K14,610 shares of common
Price—$1 per share. Proceeds—To be invested in
"royalty pool." Office—c/o Homer Lee
(President), Mid¬
lothian, Texas.

Underwriter^-None..

•

•'Fall

River Electric
Light Co. (3/9)
Jan. 29 filed $6,800,000'ol first
mortgage and
tcust bonds

collateral

duerJaiU;.'!, 198$/ Proceeds—To

redeem $2,000,000 of 3%% bonds and to
repay $4,800,000 of bank
loans. I nderwrlters—To be
determined by competitive
bidding. Probable bidders:-Halsey, Stuart & Co.
Inc.;
Lehman
Brothers, Bear, Stearns & Co. and Salomon
Bros.

&

Hutzler

First Boston

(Jointly); Glore, Forgan & Co.; The
Corp. Bids—-Expected to be received about

March 9 at 11

a.m.

(EST) at 49 Federal St, Boston, Mass.
if Finance Investment Management
Corp.
Jan. 29 (letter Of
notification) 74,116 shares of class A
coihmon stock.

Price—$1

per share.

rdl

Proceeds—For gen-

corporate purposes. Office
129 West Fourth
harlotte, N. C. Underwriter—None.
—

First
eb.

9

Springfield Corp., Springfield, Mass.
filed 20,000 shares of
capital stock (par

rice—At market.

Proceeds

—

For

investment.

St.,

($100

riter—None.
Food Fair
Stores,

ah.

21

filed

Inc.

$12,500,000

(2/13)

of

20-year sinking fund de1, 1973. Price—To be supplied by
mendment.
Proceeds—To repay $7,000,000 bank loans
nd to acquire additional
facilities. Underwriter—Eastan, Dillon & Co., New York.
en

tures

due

Feb.




per

development of Israel. Underwriter

East

City, Mo.
Underwriter
Land, Inc., Kansas City, Mo.

i Justheim Petroleum Co., Salt Lake City, Utah
Feb. 2 (letter of notification) 1,500,000 shares of common
stock (par five cents). Price—13 cents per share. Pro¬
ceeds—To

acquire new properties and for drilling ex¬
Office—212 Phillips Petroleum Bldg., Salt Lake
City 1, Utah. Underwriter—None.

penses.

i KTAG TV, Inc., Baton Rouge, La.
30 (letter of notification) ,1,000 shares of common
stock (par $100) and $80,000 of debenture bonds
(in de¬

Jan.

nominations

of

Price—At par

$100 and $1,000 and multiples thereof).
principal amount. Proceeds—To pur¬
Underwriter—None.

or

chase equipment.

Kellogg Petroleum Products, Inc.
14 (letter of notification)
1,221 shares of capital

Jan.

stock

(no par)

being first

—

27th

Street

Prugh,

Terrace,
Combest, &

Improvement Financing Corp.
Jan. 30 (letter of
notification) 200,000 shares of class
A common stock
(par 50 cents). Price—:$1.50 per share
Proceeds—For construction of home

improvements and
time financing in connection therewith.
Office—240 West
Front St., Plainfield, N. J. Underwriter
George A.
—

Hooker

Offering—Temporarily postponed.

Electrochemical

Co.
Jan. 15 filed 97,147 shares of $4.20 cumulative converti¬
ble second preferred
stock, series B (no par) being of¬

each

for subscription

by

common

stockholders

one

preferred shares for

the basis of

on

10 shares of

new

of

rec¬

stock

common

held; rights to expire
Price-//$19(M3er share. Proceeds—For expansion
program; apcl ^wqrkmg capital. Underwriter
Smith,
Feb.: 18.

—

Ba rney

Price—$125

per

share.

/Cd;,/^&w/York.
filed

(3/3)
$10,000,000 first mortgage, bonds due 1983.

Proceeds—For

construction

program.

Underwriters—

To be determined

ders:

by competitive bidding. Probable bid¬
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.; Union

Securities Corp.; W. C. Langley & Co.,
White, Weld & Co.
and Shields & Co.

(jointly); Lehman Brothers, Goldman,

Sachs & Co. and The First Boston

Corp. (jointly); Hemp¬
hill, Noyes & Co. and Drexel & Co. (jointly); Equitable
Securities Corp. Bids—Expected March 3.

Exchange Corp., Walla Walla,
25 filed 30,000 shares of common stock
14,000 shares of preferred stock (par $50)
28,000 common shares and all of the preferred
Nov

and

to

be offered

shares

of

in units of

common

one

stock.

Wash.
(par $10)
of which

stock are
share of preferred and two

Of

remaining

2,000

common

shares, 500 have been sold to directors and 1,500 are to
be reserved for directors and sales
representatives. Price
—$70

Proceeds—For

working

capital.

Underwriters—None, but Hamlin & Lunt, Buffalo, N. Y.,
will

offer any unsubscribed

shares.

if Kirk Uranium Corp., Denver, Colo.
Feb. 6 (letter ^pf notification) about,900,000-shares bt
..capital stock-(par one cent). Price—30 cents per share.
Proceeds—For

mining expenses. Office—405 Interstate
Bldg., Denver 2, Colo. Underwriter—Gardner &
Co., New York.

Trust

1,000,000 shares of beneficial interest in this

Underwriter

per

unit. Proceeds—For working capital.

writer—None.

Under¬

—

Knickerbocker Shares, Inc., New

York.
•

Lehman

Corp., New York (2/18-20)
capital stock (par $1). Price

Jan. 30 filed 37,800 shares of
—To be

supplied by amendment.

Allan S.

Lehman, deceased.
thers, New York.

Proceeds—To Estate of

Underwriter—Lehman Bro¬

Lorain
Dec.

9

stock
mon

Telephone Co., Lorain, Ohio
(letter of notification) 5,000 shares of common
(no par) to be offered for subscription by com¬

stockholders at rate of

shares

Ohio.

held.

new

one

Price —$20

filed

& Electric Co.

200,000

record

Jan. 29 at

shares

held;

—

For

shafes of

rate

of

common

new

one

(Ky.)

common

stock -(no

par)

stockholders of

share for each

seven

rights

expire Feb. 17. Price—$36.50 per
Proceeds—For property additions and improve¬
Underwriters—Lehman

ments.

Co.,

Proceeds

Office—203 W. Ninth Street, Lorain,

being offered for subseription by

share.

share for each 15.41

share.

per

Underwriter—None.

Louisville Gas

Inc.,

both

of

Brothers

and

Blyth

i&

New York.

Magma King Manganese Mining Co.
Nov. 12 (letter of notification) 553,500 shares of common
stock (par 10 cents). Price—50 cents per share. Proceeda
—For

working

Phoenix,

Ariz.

capital. Office — 532 Security Bldg.,
Underwriter—Weber-Millican Co., Nefr

York.

if Maryland Casualty Co., Baltimbre, Md.
Feb., 5 filed 475,000 shares of
be

offered

common

(2/26)

stock (par $1) to

for

subscription by common stockholders bf
21; rights to expire about March 12. Price—
To be supplied by amendment. Proceeds — To increase
capital and surplus. Underwriter—Merrill Lynch, Pierce,
Fenner & Beane, New York.
record Feb.

★ Indianapolis Power & Light Co.
Feb. -9

for subscription, by

offered

stockholders of record Dec. 26, 1952, at rate of one new
share for each 2.4 shares held; rights to expire Feb. 11.

common

Home

fered

Israel Securities

—

Corp., New York.

Jan.'8

Office—410

Insurance

$10).

Under-

Mineral Development Corp.^
30,000 shares of class A stock. Price—At par
share). Proceeds—For industrial and mineral

working capital.
Kansas

★

New York.

&

Oct. 6 filed

property additions.

ord Feb. 3

.1;

Industrial

Holiday Plastics, Inc., Kansas City, Mo.
Dec. 10 (letter of
notification) 3,799 shares of common
stock (no par).
Price—$13 per share. Proceeds—For

Searight, New York.

if Exchange Royalty Co. of Texas

in New York.

17

Ispetrol Corp., New York
Oct. 29 filed 49,500 shares of common stock. Price—At
par ($100 per share). Proceeds—To finance purchase of
crude oil for Israeli enterprises and to purchase crude
oil and oil products for resale in Israel. Underwriter—

Fund.

notification) $300,000 of 4%'% general

$100 and $500 each). Proceeds
For
improvement of real estate. Office—618 North Third
St.,
Minneapolis 1, Minmi .Underwriter—None.

Feb. 3

stock.

be

bidders:

Feb. 9 filed

Co.,

.

key employees and
options, and 2,435,583 shares in exchange for oil and
gas

•

derwriters—To

■

are

(2/17)

if Knickerbocker Fund, New York

★ Hall Building
Feb. 6 (letter of
obligation bonds
denominations of

stock (par one cent).
•
Price—25 cents per share. Pro¬
ceeds—To acquire
English Oil Co., Salt Lake City, Utah (2/16)
working interest in oil wells. Office
' • ■
Jan. 5 filed 3,435,583 shares of common
stock, of which ; —Cravens' Bldg.,', Oklahoma City, Okla. Underwriter—
Winner & Meyers, Lock
750,000 shares are to be offered publicly, 250,000 shares
Haven, Pa.
•

Iowa Southern Utilities Co.

Jan. 21 filed $7,000,000 first mortgage bonds due Feb. 1,
1983.
Proceeds—For additions and improvements. Un¬

shares

and surplus.
Address—P.
Underwriter—None.

Tex.

(letter of notification). 10,000 shares of
common
(par $1). Price—At market

share).

per

record

35

3.

capital

Manufacturing

Dee. 22

of

for each

March

''

tex.

5,000 shares of capital
(par $10) to be offered for subscription by stock¬

stock

•

stock

Gulf Insurance Co.,
Dallas,
19 (letter of
notification)

Jan.

;

St., / Galetpn, ^ Pa.
-A"

be supplied by amendment. Proceeds—For newTonstruction.Offices—Toronto, Ont., and Edmonton, Alta. Under¬

Probable

(2/16-17)

publicly and 30,000 shares to employees. Price
To
public, $10 per share; to employees, $9 per share. Pro¬

Community Credit Co., Omaha, Neb.
Jan.

Dallas, Tex.

(Canada)

writers—To be supplied by amendment.

notification) 1,400 shares of capital stock
Prices—At fnarket
(approximately $70

Commonwealth Oil Co., Miami, Fia.
Jan. 26 (letter of
notification) 5,000 shares- of common
stock (par one cent).
Price—$3.87% per share. Proceeds
—To C. Dale
Armour, the selling stockholder. Under¬
writer—Gordon Graves & Co., New York.

Pipe Line Co.

Feb:'6 filed 1,500,000 shares of capital stock (par $5) to
offered for subscription by stockholders.
Price—To

be

Feb. 4 (letter of

to broker-dealers for

,

Interprovincidl

corporation and its subsidiaries under a "Restricted
Stock Option Plan." Statement
effective Feb. 3.

one share of common stock. Price—$3
Proceeds
For working capital. Business —
Manufactures electrical equipment.
Underwriter—None.

unit.

'

(par $10) to
key employees

of

-preferred;and

per

Foster IVhedler
Corp.

Jan. 5 filed 30,032 shares of
common stock
be offered to certain officers
and other

stock

McCarthy

(Glenn), Inc.

June 12 filed 10,000,000 shares of common stock

(par 25
Price—$2 per share. Proceeds — For drilling Of
exploratory wells, acquisition of leases and for general
corporate purposes. Underwriter—B. V. Christie St Con
cents).

Houston, Tex.

Dealer Relations Representative—George

A. Searight, 50 Broadway, New York, N. Y.
WHitehall 3-2181. Offering—Date indefinite.

Telephonr

McGraw (F. H.) Co., Hartford, Conn.
Sept. 10 (letter of notification) 5,000 shares Of common
stock (par $2) and warrants to purchase 20,000 sharea
of

common

of

one

shares.
S.

stock at

share

and

$6

per

warrants

Price—$19.87%

per

share to be offered in unita
to purchase four additional
share. Proceeds—To Clifford

Strike, the selling stockholder.
bery, Marache & Co., New York.

Underwriter—Gran-

it McKesson & Robbins, Inc., N. Y. (2/26)
6 filed $15,000,000 of sinking fund debentures due
March 1, 1973. Price — To be supplied by amendment.
Continued on page 44
Feb.

Thc Commercial and

Financial Chronicle

..

Thursday, February 12, 1953

.

(716)-

M

Co. and The First

43

Continued from pacje
Proceeds—To finance

<

.

receiv¬
New York.

Ohio
capital notes
each) and 1,970 shares of

if Metropolitan Finance Co., Cleveland,
Feb. 4 (letter of notification) $197,000 of 5%

\(in denominations of $100
class B common stock

to be offered in

(par $1)

units of

$100 note and one share of stock. Price—$101 per
unit. Proceeds—To increase capital. Office—835 National
one

Ohio. Underwriter—None.
Granite City, III.
113,000 shares of 6% cumulative preferred

City Bank Bldg., Cleveland 14,

Mex-American Minerals Corp.,
Nov. 3 filed

(par $5) and 113,000 shares of common stock
10 cents) to be offered in units of one share of

stock

Price—$6

class of stock.

per

(par
each

processing, refining and
—
To be supplied by

Nielco Chemicals,

Office—8129 Lyndon Ave., Detroit 21,
Underwriter—Smith, Hague & Co., Detroit, Mich.

date notes.

if North Pacific Exploration, Ltd., Toronto,
1,375,000 shares of capital stock (par

A Mississippi Power & Light Co. (3/17)
Feb. 11 filed $12,000,000 of first mortgage bonds

due 1983.
Proceeds—For construction program. Underwriters—To
toe determined by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc., White, Weld & Co. and Kidder,
Peabody & Co. (jointly); Merrill Lynch, Pierce, Fenner
& Beane; Union Securities Corp.; The First Boston Corp.
and W. C. Langley & Co. (jointly).
Bids—Tentatively
^Mitchell (John E.) Co., Inc., Dallas, Tex.
29 (letter of notification) 250 shares of common
stock. Price—$200 per share.
Proceeds — For working
capital. Office—3800 Commerce St., Dallas 1, Tex. Un¬
derwriter—None.

4: Mohawk Business Machines Corp.
Feb. 6 (letter of notification)
144,000 shares of con¬
vertible preferred stock (par $1). Price—$2 per share.
Proceeds—For working capital, etc. Office—47 West St.,
New York 6, N. Y., Underwriter—None.
if Morgan Milk Co., Fort Morgan, Colo. i
Jan. 29 (letter of notification) 3,000 shares of common
stock and 3,000 shares of preferred stock. Price—At par

Proceeds—For working capital. Under¬

writer—None.

if Morrison-Knudsen Co., Inc., Boise, Ida.
Jan. 24 (letter of notification) 30,000 shares of capital
stock (par $10) to be offered for subscription by em¬
ployees. Price—At 95% of the market price. Proceeds—
None. Office—319 Broadway, Boise, Ida.

if Murphy (A. A.) & Co., Inc., St. Paul, Minn.
Feb. 3 (letter of notification) 2.000 shares of 6%
stock,

1947

series.

Price

—

At par ($50 per

if Narragansett Electric Co. (3/10)
Feb. 10 filed $10,000,000 of first mortgage bonds, series
D, due March 1, 1983. Proceeds—To repay bank loans
new

Underwriters

construction.

—

March 10.

Feb. 3 (letter of notification)

250 shares of common stock

$5) - to be issued to employees upon exercise of
stock options.
Price —$8.10 per share. Proceeds —For
working capital. Office —947 West St. Paul Ave., Mil¬
waukee, Wis. Underwriter—None.
(par

if Neuberg Bros. & Sloan, Inc., Basin, Mont.
Jan. 26 (letter of notification) 250,400 shares of common
Price

exploration.

—

25 cents per share.

Address

—

Box

Proceeds—For mine

124, Basin, Mont.

Under¬

writer—None.
New

England Power Co. (3/3)
80,140 shares of new cumulative preferred
stock (par $100) to be offered for subscription by present
holders of 6% preferred stock on a share for share basis;
Feb.

stock (par $1).
Proceeds—To qualify to do busi¬
ness
in Arizona.
Underwriter—None. Offering to be
made initially to persent and future policyholders of
company and to certain specified officers and directors.
Production Co.
shares of common stock (par 543
cents). Price—To be supplied by amendment. Proceeds—
To buy property for oil prospecting.
Office—Houston,
Tex.
Underwriter—To be named by amendment. .Of¬
Texas General

York.

fering—Tentatively postponed. Statement may

499,325 shares of capital stock

drawn.

erties

commission
basis (selling commission is two cents per share). Of¬
fice—c/o Nevada Agency & Trust Co., Inc., Cheney Bldg.

derwriter—None, with sales to be made on a

in

oil and gas

Del.

$1).

Price—$500 per unit.
Underwriter—None.

purchase

amendment.

Price

Proceeds —-For

—

To be supplied by

repayment of bank loans.

Underwriter—Morris Cohon &

$2.75 per share).

Manufacturing Co.

the

stock (par $1),
amended to 400,000 shares). Price—$2 per share.

^ United Funds, Inc., Kansas City, Mo.
Feb. 10 filed 500,000 United Accumulative

Proceeds—For machinery and
struction.

equipment and new con¬
of heavy duty power

Business—Production

research

and

shares). Price—At market.
Proceeds—For
Underwriter—Waddell & Reed, Inc., Kansas

Office—6518
Underwriter—None.

Regent Manufacturing Co., Inc., Downey, Calif.
(letter of notification) $150,000 of first mortgage
bonds, of which 130 units will be issued at $1,020 each
and 40 units at $510 each. Proceeds—For building and

United

cent). Price—30 cents

Angeles, Calif.

per

share. Proceeds—To purchase
Underwriter — Morris

'

Cohon & Co., New York.

Niagara Mohawk Power Co.
Jan. 23 filed

Proceeds—-To

construction.

(2/16)

1,000,000 shares of common stock (no par).
retire part of bank loans and for new
Underwriters—To be determined by com¬

petitive. bidding.

-

Probable




bidders; Morgan Stanley &

Sapphire Petroleums Ltd., Toronto, Canada
28 filed 50,000 shares of common stock (par $1—
Canadian).' Price—To be supplied by amendment. Pro¬
ceeds—To
Ken Kelman, the selling stockholder, who
will offer the shares from time to time either on the

Security Life,

Phoenix, Ariz.

class A
units to
be sold in units of 30 shares and one participating unit
Price—$120 per unit. Proceeds—To increase capital and
surplus. Office—7 Weldon, Phoenix, Ariz. Underwrite!
(letter of notification) 75,000 shares of
common stock (par $1) and 2,500 participating

Dec.

equipment. Office—11905 Regentview Avenue, Downey,
Calif. Underwriter — Hopkins, Harbach & Co., Los

for drilling expenses.

t

Corp., Bismarck, N. D,
Nov. 17 (letter of notification) 150,000 shares of class A
voting stock and 150,00 shares of 4% class B non-voting
stock.
Price—$1 per share.
Proceeds—To purchase oil
and gas leases.
Office—222 Main Street, Bismarck, N. D.
Underwriter—John G. Kinnard & Co., Minneapolis, Minn,

Newton-Phoenix Oil Corp., Houston and New York
Feb. 3 filed 2,500,000 shares of common stock (par one

and

investment.
City, Mo.

United Petroleum & Mining

advertising program.

Ave., Seattle 5, Wash.

Fund shares
to acquire
underlying

$12,000,000 of periodic investment plans
UAF shares (plus an estimated 1,000,000 of

if Ravenna Metal Products Corp., Seattle, Wash.
Jan. 30 (letter of notification) 20,000 shares of class A
common stock (par $10).
Price—$15 per share. Proceeds
—For

i

.

and

sprockets, gears, etc. Office—Longview, Tex. Underwriter—Dallas Rupe & Sons, Dallas,
Texas; and Straus, Blosser & McDowell, Chicago, 111.

transmission chain,

Dec. 31

land

Underwriter—Gearhart & Otis,

(later

Inc.; Harriman Ripley & Co. Inc.; Lehman Brothers.
Bids—Tentatively scheduled to be received up to noon
March 3 at 441 Stuart St., Boston 16, Mass.

Proceeds—To O. Roy Chalk, President,

selling stockholder.

Inc., New York.

Ravenna

on

j

Sept. 25 filed 250,000 shares of common

Underwriters—To be determined by competitive bidding.
Probable bidders: The First Boston Corp.; Blyth & Co.,

(EST)

Proceeds—To enlarge operations.

if Trans Caribbean Airways, Inc., N. Y.
Feb. 3 (letter of notification) 20,000 shares of Class A
common stock (par 10 cents).
Price—At market (about

4 filed

rights to expire March 23.

Houston, Tex.

Offering—Expected in a week or two.

Co., New York.
Powers

Oil Co.,

* Tops All Foods, Inc., Portland, Ore.
Jan. 26 (letter of notification)
101 shares of common
stock and 404 shares of preferred stock to be offered in
units of one common share and four preferred shares.

40,000

business.

offered for oil prop¬

of notification) 100,000 shares of common
stock (par 10 cents). Price—50 cents per share. Proceeds
—For working capital. Office—1 Main St., Houston, Tex,
Underwriter — Scott, Khoury & Co., Inc., New York.,

shares of capital stock (par ,$1)
reserved for issuance.
Price—$10 per share for stock
and five cents for the warrants.
Proceeds—To engage
and

1,250.000 shares will be

Texas Western

Proceeds—For general corporate
purposes. Business—Plans to produce and sell petroleum
and its products from lands to be held under concession
from the Peruvian Government.
Underwriter—None.
Phoenix-Campbell Corp., New York
26 filed 40,000 shares of common stock

and

Nov. 12 (letter

Price—$1.10 per share.

Jan.

(3/2)1

Underwriter—None.

erty.

Virginia St., Reno, Nev.

Inc., Dover,

Exploration Co., Ft. Worth, Tex.

(letter of

5

if Texas-Oklahoma Oil & Gas, Inc., Dallas, Tex.
Jan. 27 (letter of notification) 2,000,000 shares of com¬
mon stock (par 10 cents), of which 750,000 shares will be
issued in exchange for certain proven oil and gas prop¬

3,000,000 shares of capital stock. Price—
cents per share). Proceeds—To drill six wells
corporate purposes. Un¬

shares of common stock (par

be with¬

.

notification) 1,200,000 shares of com¬
mon stock (par 10 cents). Price—25 cents per share. Pro¬
ceeds—To drill oil and gas wells and for acquisition oi
properties. Underwriter—Peter W. Spiess Co., New York,

subleased land and for other

Oil Concessions Co.,

.

Texas Oil
Dec.

Valley Oil Co., Reno, Nev.

Peruvian

4 filed 2,500,000

June

Sulphur Co.

Jan. 16 filed 9,000,000

Phoenix, Ariz.

1,000,000 shares of capital

Price—$1.50 per share.

Aug. 20 filed

N.

Insurance Co.,

Sun Fire
Dec. 22 filed

both of New York.

139

purchase operating certificates and for working cap¬
Office—2 East 33rd St., New York. Underwriter—

None.

(par 70 cents')
being offered for subscription by stockholders at rate of
one
new share for each 2V2
shares held as of Feb. 4;
rights to expire Feb. 18. Price—$7 per share. Proceeds—
For new construction and working capital. Underwriters
—Kuhn, Loeb & Co. and Carl M. Loeb, Rhoades & Co.,

on

York.

ital.

Underwriter—None.
Corp., Brooklyn, N. Y.
Jan. 16 (letter of notification) 99,000 shares of common
stock (par 25 cents). Price—$3 per share. Proceeds—
For expansion and working capital. Underwriter—G. K.

warrants

if Nesco, Inc., Milwaukee, Wis.

stock.

to

Paley Manufacturing

Halsey,

Forgan
& Co. (jointly); Salomon Bros. & Hutzler; Kidder, Peabody & Co. and Stone & Webster Securities Corp. (joint¬
ly); Lehman Brothers and Goldman, Sachs & Co. (joint¬
ly); Union Securities Corp.; The First Boston Corp.;
White, Weld & Co.; Blyth & Co., Inc., and Harriman
Ripley & Co. Inc. (jointly). Bids—Tentatively expected
on

stock (par 10

Elkhart, Ind.

At par (10

(par $1>

if Star Air Freight Lines, Inc., N. Y.
Feb. 4 (letter of notification) 149,000 shares of common
stock (par $1) in units of 20 shares. Price—$20 per unit.
Proceeds—To purchase Quaker City Airways, Inc. (Pa.),

To be deter¬

mined by competitive bidding. Probable bidders:
Stuart & Co. Inc.; Kuhn, Loeb & Co. and Glore,

to be received

Dillon, Read & Co. Inc., New

if Owners Discount Corp., Elkhart, Ind.
Feb. 2 (letter of notification) 5,500 shares of class A com¬
mon
stock (no par). Price—$20 per share.
Proceeds—
For financing and loans.
Office—416V2 South Main St.,

Dec. 24 filed

Co.

rights to expire on Feb. 17. Price — $21.50 per share..
Proceeds — For construction program.
Underwriter—

Price—20 cents per share. Proceeds—To make
geological survey of land. Business—Oil and gas explor¬
ation. Underwriter—None.

Pan American

—

York.

293,462 shares of common stock

filed

13

amendment.

Underwriter

program.

being offered for subscription by common stockholders
of record Feb. 2 at the rate of one new share for each
12
shares held
(with an oversubscription privilege);

Nyal Co., Detroit, Mich.
(letter of notification) 200,000 shares of common
stock (par 10 cents). Price—$1.25 per share. Proceeds—
To repay loans and for working capital. Underwriter—
Gearhart & Otis, Inc., New York.

Shields & Co., New

construction

Southwestern Public Service
Jan.

Dec. 28

Paradise

prior

share). Proceeds—For working capital.
Underwriter—
Piper, Jaffray & Hopwood, Minneapolis, Minn.

and for

for

unit. Proceeds—For drilling of additional wells
and to purchase producing wells.
Underwriter—M. S.
Gerber, Inc., New York. Financing may be revised.

Overland Oil, Inc., Denver, Colo.
23 filed 300,000 shares of common

For

—

Kidder, Peabody & Co., New

cents).

March 17.

Jan.

preferred

Proceeds

per

Dec.

$4.50)

common

March 4. Price—To be filed by

to expire on

400,000 shares are to be offered in units of 100 shares
subscription warrants for 40 shares. Price—
$52

to

scription privileges for holders of less than seven shares
of outstanding common stock subject to allotment; rights

of stock and

Underwriter—None.

($10 per share).

18 at

with

stock (par 20
warrants for 600,000

which the stock and subscription warrants

shares, of

shares of common stock (par

stockholders of record Feb.
rate of one new share for each seven shares held,,
additional subscription privileges (including sub¬
offered

be

to

1,000,000 shares of capital

filed

cents—Canadian) and subscription

Offices—507 Bank St., Wal¬
Idaho, and W. 909 Sprague Ave., Spokane, Wash.

on

21

Nov.

Management, Inc., Wallace, Idaho
(letter of notification) 400,000 shares of common
Price—75 cents per share.
Proceeds—For ex¬

expected

Canada

Oils Ltd., Canada

Northland

(2/18)

South Carolina Electric & Gas Co.
Jan. 28 filed 358,045

25 centsCanadian). Price—$1 per share (U. S. funds). Proceeds
—For exploration costs. Underwriters—Aetna Securities
Corp. and L. D. Friedman & Co., Inc., both of New York.

ploration and development.
lace,

timore, Md.

Mich.

Feb. 4 filed

Mines

stock.

Mich.

Inc., Detroit,

Co., Smart, Clowes &

Wagner, Reid & Ebinger, Inc.,

(letter of notification) 34,800 shares of common
stock. Price—At par ($5 per share). Proceeds—To liqui¬

Jersey City, N. J.

Jan. 19

Oswald, Inc., and
all of Louisville, Ky.
'*
Shirks Motor Express Corp. (Del.)
Jan. 8 (letter of notification) 20,000 shares of 6% cumu¬
lative preferred stock.
Price—At par ($10 per share);
Proceeds—For working capital.
Office—Manheim Pike,
Lancaster, Pa. Underwriter—Alex. Brown & Sons, Bal¬
Bond

Bankers

Nov. 19

Underwriter—W. C. Doeh-

St., Wilmington, Del.

Jan. 12

(EST) on Feb: 18.

notification) 400,000 shares of common
stock (par five cents). Price—60 cents per share. Pro¬
ceeds—To acquire additional properties. Office—927-929
ler Co.,

Seymour Water Co., Seymour, Ind.
(letter of notification) 5,000 shares of 6% cumu<*
lative preferred stock
(par $25).
Price — $26.50 per
share.
Proceeds—For improvements.
Underwriters—-

$25,000,000 of general mortgage

February, 1983. Proceeds—To repay, in
of bank loans and for new construction.

Nov. 10 (letter of

Market

(2/18)

Co.

(letter of notification) 14,000

Nov. 14

bonds due
part, $40,000,000
Underwriters—
To
be determined by competitive bidding.
Probable
bidders: Halsey, Stuart & Co. Inc.; Morgan Stanley &
Co.; Kuhn, Loeb & Co.; Kidder, Peabody & Co.; The
First Boston Corp. Bids—To be received up to 11 a.m.
23 filed

Jan.

Refining Co.

&

Calif.
'*
shares of common
stock (par $1). Price—$20.75 per share. Proceeds—For
working capital. Office — 945 South Flower St., Loa
Angeles 15, Calif. Underwriter—None.
Finance Co., 1 Los Angeles,

Seaboard

(jointly); Merrill Lynch,

,

Niagara Mohawk Power

amendment.

Mid-Gulf Oil

(EST) on Feb. 16. «

noon

unit. Proceeds—For work¬

ing capital. Business—Purchase,
sale of Fluorspar. Underwriter

Boston Corp.

Fenner & Beane, Kidder, Peabody & Co. and
White, Weld & Co. (jointly). Bids—To be received up to

Pierce,

increased inventories and

Underwriter—^Goldman, Sachs & Co.,

ables.

,

2

—Life Underwriters,

Inc., Phoenix,

Ariz.

Oct.

New

York

Curb

Exchange

market. Underwriter—None.

or

in the over-the-countei
-

..

„

■

if U. S. Airlines, Inc., N. Y.
Feb. 6 (letter of notification)
stock
690

attorney's fees.

31,678 shares of common

be offered in payment of $18,*
Office-—500 Fifth Ave., New York*

(par five cents) to

Volume 177

Number 5194

.

.

The Commercial and Financial Chronicle

.

(717)

£ United States Spring & Bumper Co,
(letter of notification) 10,000 shares of

Jan; 20

Arkansas Power & Light Co.
15 it 'was reported
company

Dec.

common

stock (par $1).

Price—$10 per share. Proceeds—To John
B. Rauen, the selling stockholder.
Office
4951 Alcoa
Ave., Los Angeles 1, Calif. Underwriter
William R.
—

Co., Los Angeles, Calif.

the

number
same

of

shares

of

expansion.

Portland 4,

Ore.

West Coast

Office—206

Board

of

Trade

Underwriter—None.

public Co. (jointly).

Baker-Raulang Co.
Jan.

Bldg.,

share of stock.

ment.

Price

—

writers—May be Riter & rCo.; Hemphill, Noyes & Co.,

To

both of New York.

stock (par 50
$50 debenture and

common
one

Bank of the
Feb.

be supplied by amend¬

1,125,000 addi¬
private sale of $55,<000,000 first mortgage bonds, to be used to build a 1,030
mile crude oil pipeline. Underwriters
White, Weld &
Co. and Union Securities
Corp., both of New York. Of¬
fering—Expected in the Spring of 1953.
stock

common

Corp., New York.

—

Jan. 29 it

(par 50

cents).

Price—To be supplied by amendment. Proceeds
—Together with other funds, to be used to build pipe¬
line. Underwriters—White, Weld & Co. and Union Se¬
curities Corp., both of New York.
Offering—Expected in
fhe Spring of 1953.

tion.

stock

minority
of

stockholders of rgcord Feb. 4 at rate

common

new

shares.

Price—$40

Underwriter—None...

Inc., Tampa, Fla.
' "
(letter of notification) 30,000 shares of common
sstock (of which 1,250 shares will be issued to Dr. Samuel
John

Price—At par
.and

($10

equipment

Fla.

R.

Himes

share).

per

for

services

Ave., Tampa,

stock
ceeds

For

oil

and

Jan. 28 it

(5/12)

reported company plans issuance and sale

was

Underwriters—To

program.

be

deter¬

mined by competitive

bidding. Probable bidders: 1 Hal¬
Inc.; Blyth & Co., Inc., and Kidder,
Peabody & Co. (jointly); Morgan Stanley & Co.; Kuhn,
Loeb & Co.; Union Securities
Corp., Equitable Securities
•Corp. and Drexel & Co. (jointly); Lehman Brothers;

sey,

Stuart & Co.

"The

First

Boston

Corp.;

Registration—Planned
.•expected at 11

a.m.

Harriman

for

April

(EST)

on

Ripley

10.

&

Co.,

Inc.

Bids—Tentatively

May 12.

plans to sell

derwriting group. Proceeds—To be used for expansion,
working capital and other corporate purposes. Under¬

writer—Morgan Stanley & Co., New York.

The

First

acted
ers

estimated

Boston

financing will

cost

Corp.,

and

of

A.

the

E.

expansion
Ames

Jan. 27 it

Public

program

Service

Co.

(3/9-13)

was

1953

of

trust

—

bonds

to

be

secured

by $9,000,uuu

nrsi

To

be

bidders:

Productions Corp.
reported company plans issuance and sale
500,000 shares of common stock. Price—Ex¬

was

about

Culver Corp., Chicago, III.
Nov. 22 it was announced that
company proposes to
offer to stockholders on or about Jan.
26, 1953, a total of
23,640 additional shares of common stock on a share-forshare basis; rights to expire Feb. 9. Price—At
par

per

share).

Proceeds—For investment.

Madison Street,

($2

Office—105 West

Chicago, 111. Underwriter—None.

construction

program.

Underwriters—For

March, 1953, about $9,000,000 of first mortgage bonds.
Proceeds—For construction program. Underwriters—To
determined by competitive bidding.
Probable bid¬

Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler;
Brothers; Kidder, Pea¬
body & Co.; Equitable Securities Corp.; Union Securities
Corp.; Harriman Ripley & Co., Inc. Registration—Ex¬
pected Feb. 16. Bids—Tentatively scheduled to be re¬
The First Boston Corp.; Lehman

ceived

March 24.

on

-(jointly).




Co., Inc.

the

loans*

sale of

debentures, the sale of

combination
well

•

of

these.

If

stock

common

conditions

present

or

a

continue-

into

next year, GPU would
expect to offer addi¬
shares to stockholders rather than resort
to bor¬

Georgia Power Co.

(3/24)
9, company applied to SEC for

Feb.
and

„

,

A

Y

authority to issue
$16,000,000 first mortgage bonds due 1983. Pro¬

sell

ceeds—For

construction program.

determined

by

competitive

Underwriters—To be
bidding. Probable bidders:

rowings.

7

it

Power &

was

Light Co.

reported

(4/7)

plans to issue and sell
$15,000,000 of first mortgage bonds due 1983. Proceeds
—To pay bank loans and for new construction. Under¬
writers

To

be

company

determined

by competitive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Kuhn, Loeb
& Co.; Harriman Ripley & Co.,
Inc.; Lehman Brothers;
The First Boston Corp.; Merrill
Lynch, Pierce, Fenner
& Beane; Shields & Co.; White, Weld & Co.
Bids
Expected April 7. Registration—Tentatively planned for
—

March

2.

at
•

Salomon Bros. & Hutzler

(jointly); Morgan StanleyCo.; Harriman Ripley & Co. Inc. Registration—Planned
11

a.m.

..

•

Bids—Tentatively expected to

(EST)

Georgia Power Co.

and

be received

March 24.

on

(3/24)

9, company applied to SEC

for

authority tq,issue

sell

100,000 shares of preferred stock (no par). Pro¬
ceeds—For construction
program. Underwriters—To be?
determined by competitive
bidding. Probable bidders;
Blyth & Co., Inc.; Lehman Brothers; Morgan
Stanley &
Co.; The First Boston Corp.; Union Securities Corp. and
Equitable Securities Corp. (jointly).

expected to be received at 11

Bids—Tentatively

a.m.

(EST)

March 24.

on

Registration—Scheduled for Feb. 20.
Gulf Power Co.

Jan.
of

28 it

was

(6/9)

reported company plans issuance and sale

$7,000,000 of first mortgage bonds due

—For

1983.

Proceeds

construction

program.
Underwriters—To be de¬
by competitive bidding.
Probable
bidders:;
Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co.; The First
Boston Corp.;
Kidder, Peabody & Co. and White, Weld

termined

& Co.

(jointly); Merrill Lynch, Pierce, Fenner &
Beane^
Bros. & Hutzler and Drexel & Co.
(jointly)Union Securities
Corp.; Equitable Securities Corp.; Leh¬

Salomon

Brothers. Registration—Planned

man

Tentatively expected at
Gulf

States

11

Utilities

Jan.

16, it was announced
$6,000,000 in common stock

a.m.

for

(EST)

May 8. Bids—

on

June 9.

Co.
company is
in June and

planning to selL
a

of first

certain amount

mortgage bonds later in the year. Proceeds—For:
construction program, expected to cost between
$26,000,—
000 and $28,000,000 this
year. The exact amount of the*
bond offering has not yet been
determined.
Under¬
writers—For
itive

common

bidding.

Fenner &

stock to be determined

Probable bidders:

by compet¬

Merrill Lynch, Pierce^
(jointly); Stone

Beane and Lehman Brothers

Corp.; Carl M. Loeb, Rhoades & Co*

Illinois Central RR.
(2/19)
Bids will be received
up to noon

(CST)

on

the company's office, 135 East 11th
Place,
for the purchase from it of
$4,500,000

certificates, series 37 to be
to mature in 30 semi-annual

dated

instalments.

ders:

Halsey, Stuart & Co. Inc.;
Hutzler; Kidder, Peabody & Co.
Jersey Central Power

&

Feb.

19 at;

Chicago 5, IlL^
equipment trusfc
March 1, 1953, andt
Probable bid¬

Salomon

Bros.

&

,

Light Co.

reported company plans to issue and selE
$9,000,000 of first mortgage bonds due 1983. Underwrit¬

23 it was announced
company plans to issue and
23,698 additional shares of capital stock (par $25) to
its stockholders on a l-for-5
basis, subject to their ap¬
proval on Feb. 25. Proceeds—To repay short-term bor¬

Florida

and

Dec. 15 it

—

•(common, The First Boston Corp. and Blyth &

$49,000,000 of bonds, debentures and pre¬
ferred stocks and GPU will furnish about
$16,000,000 to
them. GPU expects to obtain the funds from bank

& Webster Securities

Dallas Power & Light Co. (3/24)
Dec. 15 it was reported
company may issue and sell In

Jan.

reported the company in February plans
to sell privately $14,500,000 of first
mortgage bonds and
in the first half of March to issue and sell
378,000 addi¬
tional shares of common stock (par
$5). Proceeds—To
finance

Inc.; Salomon Bros. & Hutzler; Kidder, Peabody &

&

in Oct. 1951.

Arizona

on

sell

Co., Ltd.,
dealer-managers in stock offering to stockhold¬

as

company

$2,460,000 equipment
bidders: Halsey, Stuart &

Fitchburg Gas & Electric Co.

major part of the in¬

the

Probable

Jan.
,

•Oct. 15 directors expected that additional
foe undertaken in 1953 to meet the

in

certificates.

ders:

publicly not in excess of $200,000,000 principal amount
•of long-term sinking fund debentures
through an un¬

crease

Co., Inc.

be

Allied Chemical & Dye Corp.
Feb. 4 company announced that
company

Aluminium Ltd.

(jointly); Harriman Ripley

pected to be around $10 per share.
Underwriter—Hayden, Stone & Co., New York.

$18,000,000 first mortgage bonds due 1983. Proceeds—

For construction

April 7.

Cinerama

Prospective Offerings

to sell around

Feb.

Jan. 9 it
,

•of

on

determined by competitive bidding
Halsey, Stuart & Co., Inc.; Kidder,
Peabody & Co.; The First Boston Corp.; Merrill Lynch,
Pierce, Fenner & Beane.

Co., Inc., both of Philadelphia, Pa.

may spend around $80,000,000 for
Of this .total, $15,000,000 will
internally leaving about $65,000,000 to be
financed by the sale of securities. Subsidiaries
expect

be provided

Probable bidders: Blyth &
Co., Inc. and Kidder, Peabody
& Co. (jointly); Coffin &
Burr, Inc.; A. C. Allyn & Co.,
Inc. and Bear, Stearns & Co.

Probable

(letter of notification) 12,490 shares of common
rstock (par $10). Price—$8 per share. Proceeds—To nine
.-selling stockholders. Underwriters—Butcher & Sherrerd

subsidiaries

construction in 1953.

for Feb. 20.

writers

York-Hoover Corp., York, Pa.

15, A. F. Tegen, President, announced that its do¬

&

collateral

Jan. 16

Alabama Power Co.

Co.

mortgage bonds held in the treasury. Proceeds—To pay
off $3,000,000 of notes and for
working capital. Under¬

—

Hughes & Co., Denver, Colo.

=and Stroud &

&

Chicago Great Western Ry.
9 William N. Deramus,
3rd, President, stated that
the company is
planning issuance and sale of $6,000,000

per share. Pro¬
leases. Underwriter
R. L.

gas

Underwriters

Jan.

(par five cents). Price—25 cents
—

Nov.

company plans sale later this
of $10,000,000 common stock (in addition to
$10,000,000 of first and general mortgage
bonds, see above)
after distribution by New
England Public Service Co. of
its holdings of Central Maine Power Co.
common stock.

Co.

Wyoming National Oil Co., Inc., Denver, Colo.
".Nov. 17 (letter of notification) 500,000 shares of common

(par $100) and of 5%
(par $20); thereafter to holders of 5%
preferred stock, series A, (par
$10); and any unsub¬
scribed shares to public. Proceeds—To redeem
$10 par
5% preferred stock (61,881 shares
outstanding at Nov.
30, 1952) and for working capital. Price—$11
per share.
Underwriter—G. H. Walker & Co., St.
Louis, Mo.
General Public Utilities
Corp.
preferred stock

year

Co.

Underwriter—Louis C. McClure & Co.,
Tampa, Fla.

first offered

Jan.

trust

Proceeds—For property

expenses. Office—349 Plant

Witter

Central RR. of New Jersey (3/2)
Bids are expected to be received
by this
March 2 for the purchase from it of

rendered).

to be

Halsey, Stuart & Co. Inc.; Lehman Brothers;
Kuhn, Loeb
& Co.; Blyth &
Co., Inc. and Kidder, Peabody & Cot
(jointly); The First Boston Corp.; Union Securities Corp.
and Equitable Securities
Corp. (jointly); Shields-& Co»

&

Westshore Hospital,

Dec. 3

and

construction.

by competitive bidding. Probable
Halsey, Stuart & Co. Inc.; Salomon Bros. &
Merrill Lynch, Pierce, Fenner & Beane and

Central Maine Power Co.
2 it was reported

:stock (par five cents). Price—Ten cents per share. Pro¬
ceeds—To reduce debt and for working
capital. Office—

Hibbs

new

determined

scheduled to be received

it Western Empire Petroleum Co., Ogden, Utah
Feb. 5 (letter of notification) 3,000,000 shares of common

G.

be

(jointly); Kidder, Peabody & Co.;
Blyth & Co., Inc.; Lehman Brothers.
Bids—Tentatively

Underwriter—None.

Bldg.,, Denver 2, Colo.

bank loans and for

Dean

Western Empire Oil Co., Denver, Colo.
Jan. 6 (letter of notification) 35,520 shares of commot
.•stock. Price—At par (10 cents per
share). Proceeds—To
rpay for options. Office — 222 Patterson Bldg., Denver.

312 Eccles

construc¬

are

rowing. Merrill Lynch, Pierce, Fenner & Beane acted
clearing agent in last stock offer.
' l *

Hutzler;

New York 7, N. Y. Underwriter—None.

•Colo.

new

the sale
Proceeds—To re¬

$8,000,000 of first mortgage bonds.

bidders:

share.

per

bank loans and for

(par $10). These

subscription by common stockholders on the basis of
about one-third share for each
common share
held; then
to holders of 5% preferred stock

tional

—To

Proceeds—For expansion
general corporate purposes. Office—195 Broadway,

:and

preferred stock
for

California Electric Power Co.
(4/7)
Jan. 29 it was announced
company proposes
pay

on

Contract Corp.
stockholders voted to approve a new issue of.
500,000 shares of authorized 6% cumulative convertible
14

(jointly); Union Securities Corp.
and J. A. Hogle & Co.
(jointly); Lehman Brothers. Bids
—Tentatively scheduled to be received on March 31.

of

share for each
10 shares held; rights to
Feb. 27. American Telephone & Telegraph Co.,
the parent, will subscribe for an additional
1,047,992.2
one

expire

repay

Underwriters—To

and Dean Witter & Co.

(letter of notification) 2,007.8 shares of common
(no par), being
offered
for
subscription by

,

General

Jan.

new

be determined by
competitive
bidding. Probable bidders: Blyth & Co., Inc.;
Kidder,
Peabody & Co.; Merrill Lynch, Pierce, Fenner & Beane

Western Electric Co., Inc.
Jan. 28

(3/31)

was

Proceeds—To

pro¬

posed $29,500,000 RFC loan, would be used for
expansion
Underwriters—May include Cohu & Co„ New>
York. Offering—Expected in
February.
V

program.

mestic

announced company plans to issue and sell
additional shares of common stock
(par $1).

136,249

stock

Follansbee Steel Corp.
/ '
16, M. A. Follansbee, President, said the
company
plans additional equity financing,
totaling about $4,500,000.
This may be done
through a rights offering to
stockholders. Proceeds—Together with funds from
Dec.

»

California Electric Power Co.

Dallas, Tex.
common

Manhattan Company
stockholders 250,000 additional
(par $10) at rate of one new

company offered
of capital stock

share for each 10 shares held Jan.
30; rights to expire on
Feb. 17.
Price—$31 per share. Proceeds—To increase
capital and surplus. Underwriter — The First Boston

and

West Coast Pipe Line Co.,
Nov. 20 filed 1,125,000 shares of

2

shares

Proceeds—From sale of units and

tional shares of

reported company late in 1953 may sell
to $1,000,000 convertible preferred or
stock.
Proceeds—For working capital/ Under¬
was

$800,000

common

.

Pipe Line Co., Dallas, Tex.

15, 1964, and 580,000 shares of
cents) to be offered in units of

it

12

about

Nov. 20 filed $29,000,000 12-year 6% debentures due Dee.

one

Corp.; White,
Lynch, Pierce, Fenner & Beane
Corp. and Central Re¬

(jointly); Equitable Securities

companies; the remaining 72,633 shares will be offered
publicly. Price—At par ($1 per share). Proceeds—For
business

Proceeds—To

construction.

Weld & Co. and Merrill

in connection with the merger of the two

name

mort¬

repay bank loans and for
Underwriters—To be determined by
competitive bidding. Probable bidders:
Halsey, Stuart &
Co. Inc.; Lehman Brothers and Stone &
Webster Secu¬
rities Corp. (jointly); The First Boston

^

Washington corporation of

a

bonds.

gage

new

ic Universal Business Forms, Inc.; Portland, Ore.
J aft. 26 (letter of notification)
100,000 shares of common
stock, of which 27,367 shares are to be exchanged for a
like

j

issue and sell,

probably in June, 1953, about $15,000,000 of first

—

Staats &

r

may

45

•

was

ers—To be determined by
competitive
bidders: Halsey, Stuart & Co.

bidding. Probable
Inc.; White, Weld & COu.
(jointly); Equitable Securities Corp.-;
The First Boston
Corp.; Salomon Bros & Hutzler; Glore^
Forgan & Co.; Kidder, Peabody & Co.; Harriman
Ripley
& Co., Inc.
Offering—Probably in April, 1953.
and

Shields & Co.

if Lake Superior District Power Co.
Feb. 9 it

was

mon

stock

(par $20)

on

29,761 additional shares
the basis of

one

new

of com¬

share for

each nine shares

held; rights to expire on March 23. Sub¬
scription warrants are expected to be mailed on or beforetMarch 7.

struction

Price—To be named later.
program.

Proceeds—For con¬
Underwriter—Robert W. Baird &

Co., Inc., Milwaukee, Wis.
_

_

(3/7)

announced company plans to issue and
sell

to common stockholders

Continued

on page

The Commercial and Financial Chronicle

46

.

Thursday, February 12, 1953

..

(718)

Continued jrom page

New York Central

45

if Lake Superior District Power Co. (3/17)
Feb. 9, Goerge Z. Donald, President, announced that
company will issue and sell $3,000,000 first mortgage 30year bonds. Proceeds—For construction program. Under¬
writers
To be determined by competitive bidding.
Probable bidders; Halsey, Stuart & Co. Inc.; Robert W.

Securities

it

3

reported company plans to issue and

was

Corp.; First Boston Corp.; Halsey, Stuart &
Co. Inc.; Harriman, Ripley & Co. Inc.; Kidder, Peabody &
Co.; Kuhn, Loeb & Co.; Lehman Brothers; Merrill Lynch,
Pierce, Fenner & Beane; Morgan Stanley & Co., "and
Union Securities Corp. Bids—Tentatively expected to be
received at 11 a.m. (EST) on April 15.
Registration—

(3/4)

RR.

sell
at competitive bidding on March 4 an issue of $9,375,000
equipment trust certificates due in instalments over a
period of 15 years. Probable bidders: Halsey, Stuart &
Co. Inc.; Salomon Bros. & Hutzler.
Feb.

.

Planned for March

13.

*

'

—

Baird & Co., Inc.

Bids—Bids are expected to be opened

Jan. 7 it
sell

March 17.

on

has established a
credit in the amount of $40,300,000 extending to
it

15

bank

announced

was

company

issuance of new
stock, prob¬
ably Blyth & Co., Inc. and The First Boston Corp
(jointly). (2) For preferred stock, may be W. C. Langley & Co. (3) For bonds, to be determined by competi¬
tive bidding.
Probable bidders: Halsey, Stuart & Co
Inc.; Blyth & Co., Inc. and The First Boston Corp
(jointly); W. C. Langley & Co.; Smith, Barney & Co.
Louisiana Power &
15 it

Dec.

was

Light Co.

announced company

issue and sell

bonds

about $10,000,000 of first mortgage

in mid-year

competitive bidding
Probable bidders; Halsey, Stuart & Co. Inc.; Kuhn, Loet
& Co. and Lehman Brothers (jointly); Blyth & Co., Inc..
White, Weld & Co. and Shields & Co. (jointly); Salo¬
mon Bros.
& Hutzler; W. C. Langley & Co., The First
Boston Corp., and Glore, Forgan & Co. (jointly); Merrill'
Lynch, Pierce, Fenner & Beane and Kidder, Peabody &
Co. (jointly); Harriman Ripley & Co., Inc.
Underwriters—To be determined by

#

Maine Central

10 it

Feb.

was

RR.

(2/25)

announced company will issue and sell

due Feb.
Underwriters—To be
determined by competitive bidding. Probable bidders,
Halsey, Stuart & Co. Inc.; Kidder Peabody & Co.; W. C.
Langley & Co.; Coffin & Burr, Inc.; The First Boston
Corp.; Merrill Lynch, Pierce, Fenner & Beane; Blyth &
Co., Inc.; Glore, Forgan & Co. Bids—To be received up
to noon (EST) Feb. 25 at 222 St. John St., Portland, Me,
$17,000,000 of first mortgage and collateral bonds
1, 1983. Proceeds—For refunding.

Merritt-Chapman & Scott Corp. (3/27)
7, Ralph E. DeSimone, President, announced that,

Jan.

primary rights would be issued to common stockholders
of: record March 27, 1953, to subscribe to additional
cqmrnpn stock on, basis of one new share for each five
shares held (with an oversubscription privilege); rights
will expire on April 14. There are presently outstanding
550*282 ($12.50 par) common shares, including shares
reserved for scrip.
Proceeds — For working capital
Underwriter—None.

Metropolitan Edison Co.
was reported company plans to issue and sell
May about $9,000*000 of first mortgage bonds due 1983
Underwriters—To tie determined by. competitive bidding
Probable bidders: Halsey, Stuart & Co. Inc.; Kuhn, Loet
Dec. 15 it

Jan. 30 it

(in addition to 80,000 shares of cumulative
stock recently offered). Proceeds—For new

Pacific Northern Airlines,

it

19

Inc.

and

Salomon

Bros.

Hutzler

&

(jointly); White.
Weld & Co.; The First Boston Corp.; Kidder, Peabody
8p Co. and Drexel, & Co. (jointly); Harriman Ripley &
Co., Inc. and Union,Securities Corp. (jointly).
Middle

Feb. 3 it

South

and

reported company

about.

Equitable Securities Corp. (jointly).

sale

11

it

near

announced company -plans issuance and
the middle of 1953 of $10,000,000 first mortgage
was

bonds. Underwriters—To be determined by competitive

bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
W. C. Langley & Co. and the First Boston Corp. (joint¬
ly); Kuhn, Loeb & Co.; Kidder, Peabody & Co.; Glore,
Forgan & Co.; Lehman Brothers; Equitable Securities
Corp.; Union Securities Corp. and Salomon Bros. &
Hutzler
(jointly); Merrill Lynch, Pierce, Fenner &
Beane; Harriman Ripley & Co., Inc.
New

it

27

on

was

announced stockholders

increasing authorized
11,500,000 shares and

common

on

Feb.

24

will

stock from 8,500,-

000 to
on a provision to provide
in connection with preemptive offerings to stockholders

that cash

or full share rights
rights to fractional shares.

may

be issued in lieu of

New Jersey Power & Light Co.
Dec. 15 it was announced company plans issue and salt
of about $4,000,000 first mortgage bonds due 1983. Un¬
derwriters—To be determined by competitive bidding.

Probable bidders: Halsey, Stuart & Co. Inc.; SalomoD
Bros. & Hutzler;. Kidder, Peabody & Co. and White.
Weld & Co. (jointly); Smith, Barney &
Co.; Union Se¬
curities Corp.; Carl M. Loeb, Rhoades & Co. OfferingProbably in May.

it

company

plans to

offer for

payment to common stockholders of
9 of a 20% stock dividend).
Price—To be

upon

record

Feb.

named

later.

ditions

to

property.

Underwriters

G. H. Walker

Pennsylvania Electric Co.
15 it was reported company plans to issue and seh
in June about $9,250,000 first mortgage bonds due 198*
and a like amount later on. Proceeds—For constructor

—To

of

ceeds—For

new

first

mortgage

Co.

&

about

bonds

(jointly);^ Equitable Securities Corp.;
—

Tentatively




and

scheduled
due to

State

one

Co.;

and

Public Service Electric & Gas Co.

.

o

.

22,

Bids—Had

but

been tentatively

offering has

conditions.

been

deferred

'

1

stock (par $10)

on

101,725 addi¬
the basis of

share for each three shares held. Jan. 29-;

expire Feb. 20. Price

—

capital and

Underwriter

surplus,
& Hutzler, New York.

reported

was

rights

$25 per share. Proceeds

To

Salomon

—

[

company

'

(4/13)
plans to issue and sell

first mortgage bonds due 1983, and 80,000
preferred stock (par $100). Proceeds—For hew
construction. Fnderwritersr-To be determined by cornshares of

petitiVe bidding^F'robable bidders: (1) For stock, KidMerrill Lynch, Pierce, Fenner
Kuhn, Loeb & Co.; Unipn Securities
Corp.jvHarrimap Ripley & Co. Inc.; The. First Boston

Kidder, Peabody & Co. and Blyth & Co., Inc. (jointly);.
Hariri man Ripley • & Co, Inc.
'
'' '" "
- -Kt
-

plans to issue and
division-first

company

Louis-Louisville

Texas Electric Service Co.

^

bidding.

competitive

by

Jan.

shares of capital

new

increase

construction/Under;

new

St.

Feb. 2 the bank offered to its stockholders

$9,000,000

be /determined

of

Bank of Albany, N. Y.

Dec. 15 it

riters—To

for

market

approximately $5,000,000 of bonds in May or June,

w

other

or

may

determined by competitive bidding. Probable
Halsey, Stuart & Co. Inc.; Kidder, Peabody &
White; Weld & Co. (jointly); Morgan Stanley

1953, and in the latter part of 1953 to issue sufficient
common shares to raise about $4,000,000.
Proceeds—To

repay/bank loans and for

announced

was

Co.; Kuhn, Loeb & Co.

Bros.

.

(2)j For bonds, Halsey, Stuart & Co, Inc.; Kuhn,

Corp.
Loeb

&

Co., Lehman Brothers and Blyth & Co., Inc.;
(jointly); Salomon Bros. & Hutzler; Union Securities
.

,

v

..

.

.

Corp.;;The First Boston Corp.; Kidder* Peabody Sc.Co.
May of $50,000,000 of first refunding-mortgagebonds,and Merrill Lynch, Pierce, Fenner & Be^pe (jointly);
Proceeds—To repay bank loans and for h€l^/construc-'' 4' -Hemphill, Noyes & Co. and Drexel & Co. (jointly)?. Bids
Jan.

12 it

reported company plans issuance and sale.

was

Underwriters—To

tion.

be

determined

-

by,, competitive^ —Expected on

scheduled

Union SecuritW
to

be

received

April 13. Registartion—Tentatively sched-

bidding,
Probable bidders; Halsey, Stuart & Co. Inc.; .tiled for March 5.
•
Kuhn, Loeb & Co. and Lehman Brothers (jointly); Mor
~
Texas Power & Light Co.
gan Stanley & Co. and Drexel & Co. (jointly); The First
Dec. 15 it was reported company may
Boston Corp.

$00,000 of first mortgage bonds.

Public Service Electric & Gas Co.

.construction.

H. Blake, President, announced that

as a

first step in raising funds to carry forward the. company's
construction program (to involve approximately $90,-

000,000 in
of

it contemplates selling 750,000 shares
March, 1953.

1953)

common

stock during the latter part of

Underwriters—Last

public stock financing in 1952

handled

by Morgan Stanley & Co., Drexel
Glore, Forgan & Co. (jointly).
if Resort Airlines, Inc.
Feb. 6 it

was

was

& Co.

and

'

.

sell about $11,-

Proceeds—For new

Underwriters—To be determined by com-

ive, bidding.

Probable

bidders:

Halsey,

Stuart

,

i/l

(2/20)

announced company plans.; to. offer for sub¬

&

Inc.; Kuhn, Loeb & Co., Blyth & Co., Inc., Kidder,
T*£abody & Co. and Merrill Lynch, Pierce, Fenner &
/Beane (jointly); The First Boston Corp.; Union Secu¬
rities Corp.; Hemphill, Noyes & Co. and Drexel & Co.
(jointly).; White, Weld & Co.; Lehman Brothers. Offerling—Tentatively expected in May.
o.

Dec.

15

.

T

■*

'

Texas

Utilities Co.
it

was

reported

that following

completion'

of

20,

proposed financing by Dallas Power & Light Co., Texas

1,449,374 additional shares of capital stock (par l6 cents)

Ejectric Service Co. and Texas Power & Light Co., sub¬
sidiaries (which see) the parent plans to offer additional

scription

by

rate of

minority

one

new

stockholders- of

share for each

Feb.

record

share

held; rights to

expire about March 16. Price—20 cents per share. Pro¬
ceeds—For working capital, etc. Underwriter—None, but

Fiduciary Management* Inc., owner of 8,956,240
will buy all unsubscribed shares.

common

stock

to

stockholders.

Underwriters—Union

Securities Corp., New York.
r~,

shares,

Washington Water Power Co.

.

★ Seaboard Finance Co., Los Angeles, Calif.

De<£ 3 it was reported company may issue and sell in
Juife, 1953, $10,000,000 of first mortgage bonds and be¬

Feb. 9, Paul

tween $14,000,000 and

A. Appleby, President, announced plans for
offering an issue of non-convertible preferred stock (no
par). Proceeds— For working capital and expansion.
Underwriter—The First Boston Corp.
Smith

Jan.

(Alexander), Inc..
it

16

additional

was

announced

common

stock

Biyth

& Co., Inc., Smith, Barney & Co. and White, Weld
(jointly); W. C. Langley & Co. and The First
Boston Corp. (jointly).
•
•
;
'>•/
:•
Wisconsin-Public Service Corp.
Co.

.

its

to

proposes

common

offer

stockholders.

If com¬

may include: Halsey, Stuart & Co, Inc.;
Union Securities Corp. and Lehman Brothers (jointly);

-*

company

to

$18,000,000 of debentures.

petitive, bidders

&

.

,

-

Underwriters^ r-Nav. 26 it was announced that company plans permanent
Co.and Dominick & D©mY£j^/imanqing prior to June 1, 1953, which may include the

Stockholders will vote April 15 on plan.
^

May be Morgan Stanley

-

termined by competitive bidding.
Probable bidders
Halsey, Stuart & Co. Inc.; Lehman Brothers; Kidder
Peabody & Co. and Stone & Webster Securities Corp

Corp.
Bids
April 14.

be

to

*

due 1983.
Pro¬
construction. Underwriters—To be. do-?

on

it

bidders:

Equitable Securities, Corp.; White,[ Weld &
Smith, Barney &. Co.

sell

as

mortgage bonds. Proceeds—For refunding. Underwriters
-

Co.; The First

Service Co. of New Hampshire /
was announced company plans to issue

that the company expects to
during the first six months of
then permissible under its mortgage

bonds

$10,000,000

tional

it

announced

the amount

23

sell

-

$65,000,000; If sold competitively, probable bidders may.'
include: Halsey, Stuart & Co. Inc.; The First Boston

3

to construct pipeline
$32,518,500.
On Sept.. 15

cost

to

Southern. Ry.

Pennsylvania Power & Light Co.
Jan. 23, Charles £. Oakes, President, announced that
new
financing this year will require the sale of from
$20,000,000 to $25,000,000 of first mortgage bonds, with
total financing for the four-year period running about

Public

been

additional

Dec.

program. Underwriters—To be determined by competi-*
tive bidding.
Probable bidders: Halsey, Stuart & Co

Nov.

estimated

Co.

company

indenture/and to provide for other permanent financing

Dec.

Corp.;

Gas

—

stock of¬

common

be appropriate at the
Halsey, Stuart &;Co.
Inc.; Kuhn, Loeb & Co.; The First Boston Corp.; Blytb;
& Co. Inc. and Kidder, Peabody & Co. (jointly)v Anystock financing may be via stockholders.
•
-

& Co.

Inc.; Kuhn, Loeb & Co.; Kidder, Peabody
Boston Corp.; Equitable Securities Corp.

Natural

authorized

Underwriter

program.

time. Probable bidders for bonds:

May be Morgan

—

Co., Coggeshall & Hicks and

Stanley &

the basis

on

by the sale pf additional first mortgage bonds

construction and ad-*

new

construction

securities in such amounts

-

Proceeds—For

had

1953 in
r

issued

be

For

FPC

3

sell

subscription by its common stockholders one additional
share for each five shares held (including the shares to<

nick, both of New York.
New Orleans Public Service Inc.
(4/14)
15 it was reported company plans to- sell

Dec.

$10,000,000

—

Southern

Co.

announced

was

(no par), to be offered first

new

facilities

at

England Electric System

Jan. 22 it.
vote

one

Nov.

books).

Jan. 20, George

Monongahela Power Co.
Dec.

of

stock

common

stockholders of record March 25

in

Utilities, Inc.

may later this. year, issue
$15,000,000 of additional common stock.
Proceeds—To repay bank loans, etc. Underwritersr-To
be determined by competitive bidding. Probable bidders:
Blyth & Co. Ind; Kidder, Peabody & Co. and Merrill
Lynch, Pierce, Fenner & Beane (jointly); Lehman Bro¬
thers; The First Boston Corp.; Union Securities Corp.
was

and sell

common

Smith, Bar ney 8c Co. handled the last
fering in January, 1949.

in

& Co.

to

Proceeds

tion of about 400,000

Peninsular Telephone

(3/25):

Co.

share for each six shares held: rights to ex¬
pire on April 10. Price—To be supplied by amendment.

reported company plans

was

Electric

was

shares of its

early registra¬
shares of common stock. Proceed!
—Together with other funds, to be used to purchase ad¬
ditional equipment. Underwriters—Emanuel, Deetjen A
Co. and Hayaen,
Stone & Co. (with latter handling
Dec.

Indiana Gas &

announced company has applied to Indiana
P. S. Commission for authority to issue 114,167 additional

the

construction.

Jan.
may

of new securities in

$23,000,000

future

preferred

1, 1953, to be refinanced by the

Dec.

securities. * Underwriters—(1) For common

Southern

announced that company plans to issue and

was

additional

an

near

Long Island Lighting Co.
Dec.

Co.

Northern Indiana Public Service

Southern Co.

-

/" vand sale of between $7,000*000 and $8,000,000'

(4/15)

Jan. 28 it was reported company

plans offering of about
-1.000,000 additional shares of common stock (par $5) to
stockholders of record about April 15 on a basis of one
for each 17 shares held; rights to expire on
Price—Expected to be named by company on
April 13. • Proceeds—To increase investments in subsid¬
new

share

May 7,.

iaries.

Underwriters—To be determined

bidding.

Probable bidders:

and from

$2,000,000 to $3,000,000 of preferred

stockt; An indeterminate number of shares of

by competitive
Blyth. & Co., Inc.; Equitable

common

early in 1954. Stock
financing, if negotiated, may be handled by The First
Boston Corp.. and Robert W. Baird & Co. Probable bidders for bonds: Halsey, Stuart & Co. Inc.; The First
Boston Corp.; Union Securities Corp.; Kidder, Peabody
& Co.; Shields & Co!; Merrill Lynch, Pierce, Fenner &
Beaner; Harris, Hall & Co. (Inc.); Carl M. Loeb, Rhoades
8c Co.; Salomon Bros. & Hutzler.
stock m^y be offered late in

1953

or

'*>''

,

Volume 177

Number 5194

The Commercial and Financial Chronicle

...

(719)
Niagara Mohawk Power which on
Monday, receives bids for 1,000,-

Grindal Named Director

000

Herbert

shares

of

stock

common

and,

on

Wednesday, is slated to sell
$25,000,000 of bonds to the highest
bidders.

New

Damper

Market

on

By and large, underwriters na¬
turally are interested in business
and the more of it the better.

this

Notwithstanding
major

the

institutional

fact

buyers

con¬

tinue to hold aloof from the

mar¬

ket,

hand

issues

new

have

been

cates

coming

moving

with little

out

or

to

trouble

no

je m.i ssions
[handled.

successfully

were
that

appears

aggregation

an

I of smaller investing organizations

|have

been taking

the

buying

the slack

up

side.

These

funds, and

in

in

offering

point.

Dye Corp.'s

is

This

cited

huge

as

reach market

a

under¬

taking is tentatively scheduled

to

early in April.

But the complaint is that it acts

'.

as
a
"damper"
on
the
overall
situation in the interval.
Naturally

all classes of investors will
be

terested in this

institutions
erates

one

degree

It

gen¬

of

reti¬

insur¬

"can't make
to

their

living just holding

a

Dealers

note

[decidedly

that

of

some

the

attractive to such buy¬

and,

in consequence,
quickly.

)icked up

Feeling in

quarters is that

some

prospects

new

due

to

reach

Bailey
Oil

Gas

of underwriters headed
Stuart & Co. Inc. on
offered $30,000,000 Ten¬

Halsey,

Feb.

10

Gas Transmission

nessee

Ltd.,

a n n o u

series

is

conversant with
investors.

as

the

Monday

Two

Fast

Sweetened

Bank
and

which

Operations

tion

by maturities that
fitted 1 well into' a

likely

tional

York

the

as

the

of

four

City of

other

incurred in
the company's

with

Research

priced at

Stores

the

to

material

with

The

Marshall

dearth

Weekend Is

underwriting

at

took

went

those

at

the

in

for-

people

had

been

poking wishfully

ahead, but for
buying end of the
especially
such
ideas

the

they gauged the amount
preliminary work involved.
Tuesday will bring $40,000,000
Consolidated Edison Co. bonds,
id $7,000,000 of Iowa
Southern
as

first

These issues

tuchen,
its

big

Isociation

the

sandwiched

operations

are

|ctor Street,

Bank,

State

affairs.

1 present claims

of

All

Africa

dividend of 25 cents per share

non-resident

shareholders

tax

on

pany's

capital

stock,

"York, N. Y., February 11,

1953.

March

••0••••••

16,

E. F.

PACIFIC

VANDERSTUCKEN, JR.,
•

FINANCE CORPORATION

j

DIVIDEND NOTICE
A regular quarterly dividend of 50 cents per share on
the common stock ($10 par
value), payable March 2,

0
•

MFG. CO.

0

COMMON

DIViDEND

NO.

115

A

February 3, 1953

quarterly dividend of

one

and three-quarters per cent was declared on
Preferred Stock of this Company,
payable

Company has been declared, payable March
30, 1953, to stockholders of record at the qlose

a

STOCK

April 1, 1953 to Stockholders of record at the
close of business March
i&r D53,-TrafRsfer books
will remain open.

Checks will be maijed.
EDMUND, HOFFMAN, Secretary.

New

of business March 2, 1953.-—

PREFERRED

.

-

D V DEND

1953, to stockholders of

rec¬

ord

was

February 16, 1953,

declared by the Board of
Directors on Feb. 4, 1953.

•

•

~

a. c. reykolds,

NO. 26

A

regular quarterly dividend of eighty-one
and one-quarter cents
(81^) per share
on
the 3!T% Cumulative Convertible Pre¬

Secretary

f.

*••••••ro••••••••••

ferred Stock. $100 par value, of this Company '
declared, payable March 5. 1953,

connec¬

has been
to

expan¬

stockholders of record

the close

at

of

DIAMOND

business February 20. 1953.

The AR0 EQUIPMENT CORP.

not

be closed.

Checks will be maimd.
W. E. HAWKJNSON

The Board of Di¬

has

of

Secretary.
February 4, 1953

Dividend Number 5

declared

on

4.40%

Cumulative Preferred Stock

by

to

Jersey,

hereby

of

share

on

Convertible

a

American-Standard

Stock

payable

March

stockholders of

16.

1953

record February

COMMON

to

A

the

1953

stockholders

nt«»

of

stockholders

record

A

the

February

27.

clasiC;

stock

of

will

1953

be
on

and

closed
a

1

will

on

three

of

re-open

Guaranty

Trust
..

Company

of

has

March

1,

record

record

.

at

the

at

of

25

Stock

de¬

the

at

cents

per

close

of

to

the

85

Thomas D. Ainslie

close

of

18, 1953.

share

on

February 20, 1953,
regular quarterly divi¬

payable March 10, 1953,

20, 1953.
DONALD

S.

CARMICHAEL,

-Secretary
on

GEORGE SELLERS,

February

Secretary

Cleveland, Ohio, February 6, 1953

DIAMOND ALKALI COMPANY

February 6, 1953

on

of

CORPORATION
JOHN E. KING
Vice President and Treasurer

Treasurer.

Common and Preferred DIVIDEND NOTICE
January 23, 1953
The Board

of

2,

stockholders of record

Directors of the

Company has declared the
following regular quarterly dividends, all payable on March
1953,

to

February 4, 1953.

CITIES SERVICE COMPANY
Dividend Notice
of

Directors

of

Cities

Service

Company has

a

share

its S10 par value Common stock, payable

on

quarterly dividend of

9, 1953, to stockholders of record

one

at

dollar

($1.0Q)

per

March

the close of business

February 13. 1953.
W. ALTON JONES,

President

the

close of business
^mom(
per Share

Preferred Stock,
Preferred Stock,

5.50% First Preferred Series.. $1.37%
4.75% Convertible Series...,. $1.18%
Preferred Stock,
4.50% Convertible Series
$1.12%
Common Stock

Board

declared

at

;

Security

The

to

holders of Common Capital
of record February

Stock

1953.

Louis H. Meade

liquidating Committee

March 2,

a

dend of 37Vti cents per share,

stockholders of record at

the close of business

business

on

Cumulative Preferred Stock
of record

AMERICAN RADIATOR & STANDARD SANITARY

F. S. CON NEXT.

February 11. 1953

Company, payable

1953

to

1953

has been declared,
1953 to stockholders

is

Ruegger




share

*.

at

Metuchen, N. J.

Jan. 20. 1953.

per

been

February 24, 1953.

dividend

Common

February 24,

Dividend checks will be mailed'by
New York.

on

Stock

payable March 24,

March 25. 1953—
the

payable

business

April 1. 1953.
Transfer books

Preferred

clared,

regular quarterly dividend ol
$1.7.5 per share on the "% Cumula¬
tive Preferred T.?t< e'e payable
April

DIVIDEND

quarterly dividend of $1.75

on

15,

The Board of Directors has declared

regular quarterly dividend of 50c
per share on the Common Stock of

DIVIDEND

the

A

27.

Stock

Diamond

dividend of $1.10 per share

and

122nd Common Dividend

a

PREFERRED

of

ending March
15, 1953, payable March 14,
1953, to holders of 4.40%

THE DAYTON POWER

Sec.-Treas.

1

of
the $4 Cumula¬
Prior Preference

Common

for the quarter

DAYTON, OHIO

declared:

were

on

Directors

Alkali Company have on
February 4, 1953, declared

business.

: AND LIGHT COMPANY

notified

the undersigned,

The

shareholders

to

the close of

at

Regular Quarterly
Dividend

common

payable April

Jan, 22, 1953

regular,quarterly dividend
per

'V

•

at the close

On
the

Company, held today, the following
A

the

the Com¬

on

payable

1953, to stockholders of record
February 27, 1953.

regular quarterly dividend of one dollar
($1.00) per share on the issued and outstand¬
ing common stock, without par value, of this

PREFERRED

ATDirector*
the meeting
of the Board
of
of American
\\ oolen
dividends

at

of business

in

located

New

creditors

therefore

Phil T.

|ted:

to

iect, however, to

•

mortgage bonds

are

National.
in

24,
1946.
The dividend wil'
approximately $1.66 per share, sub
any change which may occur
in
the rate of exchange for South Afric:
funds prior to March 3, 1953. Union of South

amount*

The Board of Directors has declared a
divi¬
dend of $1.00 per share and an
additional

IN WOOLENS"

..

01

TEXAS GULF SULPHUR-COMPANY

COMPANY

LIQUIDATION NOTICE

ksing

ALEXANDER, Secretary,

Secretary

competitive bidding.

tuchen

H.

1953.

business

dated, June

L. L. HAWK

^

new

many

two

quar¬

April 2, 1953.

of

issues shaping
for the week ahead.

itween

a

NOTICES

15th

the

Out

when
look

a

lidable list of

,

declared

close of

of 7.2% will ;be deducted.
By Order of the Board of Directors,
H. E. DODGE, Secretary.

Company, 30

CAN

of. record

long week-

a

business,

window

Itilities Co.

10,

AMERICAN

NOTICES

$25,-

id entertained by some
people in

la

Directors has

the

t

stock

—

fded

of

of sixty cents
per share payable
1953 to stockholders of record at
business on February 18, 1953.

at

6, 1953 of American shares issued
the .terms of the Deposit AgTeemcn

under

to the

deben-

around

prospects of

in

16,
of

March

New

share

SI .00

iiness

close

holders of record

regular quarterly
dividend of 20c per

tive

lose

added

Co., 550 South

rectors

did

par,

attested

good

today declared a divi
shillings per share on the
Shares of the Company payable

twelve

■

•'

linute.

A

Board

North La Salle Street.

/ "THE GREATEST NAME

Department

the

of

March 3, 1953.
The Directors authorized the distribution o:
the said dividend on March 13, 1953 to th

dividend

March

February

S. Hollister has become associated

•

equally
well. The performance of both

it

The

terly
the

L. Renger has been

Corp.'s $30,000,-

|00,000 of 25-year 3Vi%

immand

NOTICES

Singer Manufacturing
Company

Bryan, Ohio

|losed quickly.

Long

■

Ordinary

rate

earlier offerings. Books

irporate

Limited

LOS ANGELES, Calif.—Herman

of 20-year first mortgage
fonds, carrying a coupon of 4ys
jnd priced to yield 4.03%, found
[he market highly receptive in
|ontrast with the situation attend-

ssues

The

D.

(00

May

O'okiep Copper Company

a

Tennessee Gas

le

of

Walston & Co. Adds

reception.

The

Institute

Antonio, Texas.

Stores, met with splen-

some

NOTICES

Dividend No. 23

W. Grindal

on

'orp. and the other for May De-

|s

Herbert

QUARTERLY DIVIDEND NOTICE

DIVIDEND

Ex¬

...

Ridge

Transfer books wi'l

of portfolios, two issues
irought to market this week, one
for Tennessee Gas Transmission

DIVIDEND

(lend

banks "and

were

Stock

The Board of Directors

DIVIDEND

Fund,
Inc. and Emery Air Freight Cor¬
poration, and is a trustee of the

sion program.

lumber

>artment

Syndicate

AILIS'CHAIMERS

Net proceeds from the sale of
may be
for_ something really at¬ the bonds will be applied by the
tractive from a yield standpoint company to payment of a portion
of its
outstanding short-term notes
lere, but then they note that the
which are held by The Chase Na¬
company
and
its
bankers
are
larket

of the

manager

Francisco

for¬

was

also

DIVIDEND

loping

?qQally

Walbert

of Lehman Brothers.

Mutual

San

San

Department of the Chicago office

director

a

Blue

of

and

changes.

need

Grindal

line bonds, 14 %%
1973, at 101.295%, and
interest, to yield 4.03%.
offering was quickly over¬

figure the bigger investors

ires,

merly

Mr.

yesterday. Mr.

due

its bid of 100.27999%.

in point. They

case

West.

accrued

securities

a

Street,

•

Co. first

subscribed and the books closed.
The group won award of the issue
at competitive sale on

as

Salle

that Richard B. Walbert

SAN

FRANCISCO, Calif.—
Philip S. Carlton, Jr. is now with
Walston & Co., 265 Montgomery
Street, members of the New York

Syndicate Manager in the Mid¬

dle

of

Blyth & Co.,

—

La

become associated with them

and

Calgary, Al¬
berta, it was

111.

South

mortgage -pipe

They cite the impending Allied
& Dye Co.'s projected
>200,000,000
issue
of -long-term
Jhemical

lg

as

Sel-,

MILWAUKEE, Wis. —Winifred

A group

This

larket in the near-term future.

lid

has

With Marshall Co.

Sells Pipe Line Bonds
by

larger outlets are disposed to
stand aside in the hope of getting
»ore attractive yields on some of

rery

board

of directors of

Halsey, Stuart Group

were

the

f '■

the

135

announces

elected

burn

Blyth I Co., Inc.
CHICAGO/

Spring Street.

Irecent offerings, providing yields
Ifrom 3%% to 4%, have proven

the

been

With Walston Co.

V

(Special to The Financial Chroniclb)

Inc.,

staff of Walston &

cash."

current

|yields.

ers

has

Southwest

and the larger

especially.

certain

a

in¬

Ex-1

Bankers point out, however,
even
the biggest institutions

that

on

interested

&

Stock

to

Richard Walbert With

York

change,

cence.

church

of small

host

a

firms

Chemical

projected

on

include

[trust funds, pension buyers,
ance

Allied

case

Absence of the big companies,
according to observers, was really
conspicuous during the last fort¬
night when a number of new

It

general market during the
waiting

re¬

cently.

But

occasional

period.

syndi¬

of

view is subject to

modification because of the effect
which such operations has on the

that

W. Grindal, a
general
partner of Reynolds & Co., mem¬
bers of the

47

...........

$0.25

•'V
•

•

,

'

The Commercial and Financial Chronicle
48

Thursday, February 12, 1953

....

(720)
the

er

BUSINESS BUZZ

how

and

main

The

from the Nation's

g]

\JlAt

-*

ported,

as

will have
discretion by April to cut the

falling
price goblins that will get farm
state
politicos when
present
price supports expire after 1954,
In the present uneasiness on this
question in Congress.
The present problem of what

support level to 75% of
If they do, how will the

the

over

worry

to do about

tional Wheat Agreement

sions before 1954.

time the rep¬

resentatives of the 42 importing

wheat

the

agree¬

ment

>&•'

expiring July 31 shall be
renewed, if it is renewed.
last maximum price for

Mr. Delano's

wheat sold under the agreement
was

$1.80 per bushel. Under this*

scheme the U. S. taxpayer is re-

direct

•

it is

the difference between
this price and the market price

"

i

Short

Will Fall

Despite the best efforts of

Administration

the
for

6,000 to 10,000 barrels per day
of aviation gas refining capacity
which PAD wants, it is reported.
The industry will not be lured
into this last increment of ex¬

nations

importing

figure they could get 700 mil¬
lion of the 800 million bushels
©f

wheat

tional

going

into

from

trade

all the traditional
defense baits, and will put it up
only if Uncle Sam hands out

pansion by

interna¬
Australia,

Canada, and Argentina. There¬

100% of the cost.

*

fore why should they pay more

The U. S. might

"cave" in to
importers, the negotiations
might drag on for weeks, or the
whole plan to renew the wheat
agreement might blow up in
everybody's face — what will
liappen is not now guessed by

said.

gives in,

indus¬
into the sum¬

along the East Coast, the

try is likely to go
mer with something huge in the
way

5% over a year ago,

the downgrade, a great
deal of wheat is likely to ac¬
U.

S.

of

Government

up

million

versus

bushels

a

ently

higher

than

consumers are

a

headache.

Oil from

going to Euro¬

now

markets would be replaced

market

flict
the

Then, too, there is the matter
©f butter, currently supported
a

of

in

•<

with the

U.

the

would intensify

exports might be even less.

90% of parity,

re-

by Iranian oil, and would seek

about 475 million

bushels last year.
If there is no new agreement,

at

problem

Abadan

the

of

Venezuela
pean

this

Iranian

the

finery, this would create some¬

thing

not export on all accounts, more
300

if

opening
,

authorities think the U. S. may

year,

a

S.

This

brewing con¬

coal miners and

oil

independent

producers

millions
pay

in the U. S.

Expect Reuther Will

of

Raise

in

view of the availability of mar¬

Those around

Cam

this town who

consort with the CIO gang pre-

garine.

reflecting

E.

Capehart

primarily

his

own*

by controls. The GOP leadership
of

Congress is against him

this

on

point.
-

(This column is intended to re¬
flect the "behind the scene" inter¬
pretation from the nation's Capital
and may or may not coincide with1
"Chronicle's"

the

diet

Roads Want Faster

Reuther will

Walter

that

views.)

own

Bookshelf

ICC Action

plenty of cain pretty soon.
Even though President Eisen¬
hower seemed to checkmate the
CIO and auto workers' chieftain
raise

by ordering the use of the old
BLS
"cost
of
living"
index

legislative project of the
railroad
industry
before
the
current Congress is reported to
be legislation which would com¬
pel the Interstate
Commerce

through June 30, Reuther is ex¬

Commission

•Chief

find one pretext or

pected to
another to

reopen

"escala¬

the

to

much

act

Blake Market Yearbook: 1953—

with General
will
pig for the whole
auto
industry. The best that
Eisenhower's move can do is to

tor" wage contract

more

Europe

Controls

tract, but even this is doubted.
Reuther is said to harbor two

price controls. His decision, as
reflected in his first message to

objectives. The more parochial
junk the concept of a wage
rate tied to any cost of living

Congress, appeared to be flatly

2960

against the standby controls.

N.

old.

or

new

is

He

The

re¬

that

hijacked much more out of GM
if he hadn't been stuck with the
clause

escalator

The other objective is to

would

make

AFL

a

break out.

It

particular Republican appeal.
was

that with the GOP

would

it

to

show the voter that the party in
control of government

expectation is that when

thinking

abandoned consumer

ing new contract demands to
GM, he will make these de¬
mands so overreaching and will

altogether.

so

uncompromising,

that

The

controls

a

GM

is,

is well known, the

as

foremost

can

portunity

see

whether

the

disputants

to

the
a

Congress

emergency,

quickly

is

and

pass

worse

best"

"the

than

Standby

Department of Economic Af¬

control

poses

New

Broadway,

27^

York

Instability in Export Markets
Under
Developed Countries:;

of

1952 II A-l—United Nations—Co¬

University

lumbia

2960;

Press,

Broadway, New York 27, N. Y.—
Paper—$1.
Financial
and

Member

Situation iii

Associated

Coun¬

tries—Organization for European*
Economic Cooperation—Columbia
University Press, 2960 Broadway,,.
New York
27, N, Y. — paper —
75 cents.

-

Mobilization of Domestic Capi¬
tal

in

Certain

of

Countries

Commission

Asiai

Nations

and the Far East—United

Asia*

for

Uni¬

and the Far East—Columbia

versity Press, 2960 Broadway, Nevr
York 27, N. Y.—paper—$1.50.

a

in

OPA and OPS, in an afternoon.

the

an*fi

United Na¬

—

Y.—paper—75 cents.

1952t
Sugar

Sugar: Facts and Figures,
United

—

no

President will stay neutral be¬
tween

if there

Accounting

fairs—Columbia University Press*.

Economic
that

was

meet

tions

price and wage control at least

defense contractor.

to

hasn't
protection

against

argument

genuine

•strike will be made inevitable.

is at least

and

them

of

Reuther gets around to present¬

be

com¬

controls,
politics to

better

be

Government

Budget Execution

Internal

spiced by

mitted against artificial

the Administration's side.
The

the form of

This argument was

seeking to split the labor move¬

weaning the

occasion in

emergency

reported to be well aware of the
Administration's strategy of
by

meet

sudden inflation, should a grave

Ad¬

ministration. Reuther is the ag¬

ment

cannot

Congress

quickly enough to undo
the
"damage" a zooming price level

contract.

it tough for the Eisenhower

standby

for

argument

controls is the old familiar one

ported to believe he could have

Cooperation*
Press, 2961b"

Broadway, New York 27, N. Y.—
paper—$3.50.

postpone until June 30 Reuther's
attempt to reopen the wage con¬

index,

The Way Ahead;

Economic

European

"Judge Eisenhower" heard both
sides of the argument about en¬
actment of standby wage and

is to

—

Towards Economic Expansion and.
Dollar Balance—Organization for.
—Columbia University

Standby

Rules Against

Cur¬

World

Report, 75 West Street, NewYork 6, N. Y.—$25.

rency

Motors. And GM, Of course,

be the guinea

Pick—Pick's

Franz

quickly in passing on rate in¬
crease
petitions asked by the
carriers to offset rising costs.

Reuther then will have an op¬

price pat¬

willing to

Homer

views in holding out for stand¬

gressive head of the CIO. He is

settled, leading to the re¬

were

in the next

supply was

9%.

And

the

couple of years. The 90% sup¬
ports will work for big crops,
other things being equal. Some

than

of stocks. While petroleum
in December was up

demand

on

hands

the govern¬

higher price.
The Avgas problem is part of
the excess supply problem that
is beginning to have the atten¬
tion of the petroleum industry.
In view
of the mild winter
ment pays a

palatable. On the other hand,
agreement
or
no
agreement,
with MSA
gifts of wheat to
European
relief
clients defi¬

the

fuel the mili¬

tary needs provided

then the high cost of continuing
the wheat subsidy will be un¬

on

Avgas,

vide the airplane

the informed.

cumulate

miltary

of

short

the

nitely

will not run
however, it is
Diversions, etc., will pro¬

The

for wheat from the U. S.

If the United States

were

Business Man's

Defense, the petroleum industry
declines to build up that last

The

some-

bombed and
indubitably

Ind.),
Chairman of the
Senate Banking Committee, is

.

.

importing nations say nothing
doing. Canada has a huge crop
and Australia is coming hack in
wheat.

Senator

on

maximum, probably
$2.50 per bushel. The

around

war

if

hand,

were

Administration,

new

Petroleum

higher

a

other

city

Avgas Capacity

States wants

Now the United

the
his

in

upset

(R.,

resignation was

reported reliably.

pay

for wheat.

%£•

the

from

ported
to
have
shelled
out
something around $600 million ;
to

or

might

here, few people would question*
"the dire necessity for controls.

and was given no
indirect promoting

voluntary,

have

turn

unhappy

the

all-out

of

free-frompolitics service of this National
Bank supervisory agency, and
he has resisted the efforts of
some to kill off bank holding
companies for the fun of their
political shooting.

nations and the four wheat ex¬

terms

situation

American

supported the career,

porting nations are doing some
fancy and fervid dickering over
"what

Quits

has been
the Currency
since Oct. 1938, submitted his
resignation effective Feb. 15.
Although Mr. Delano is a Dem¬
ocrat, his personal views on
economic matters are definitely
conservative. He has staunchly

is get¬

E very-

entire way of doing business.

Preston Delano, who

the

At the present

any

war

On

Comptroller

boys down, who are
afraid this thing will creep up
©n them
and force some deci¬

ting

that

belt?
Delano

would

businessman

the dairy

yelp from

resulting

plan¬

investment.

and

reckon with the uneasy prospect,

parity.
Eisen¬

Administration take the

hower

renewed Interna¬

a

ning

The Administration

books would act

to business

damper

a

sup¬

exist¬

very

contingent power

the statute

on

WASHINGTON, D. C.—There
Is said to be something more

is that the

of such a

ence

than

the

of

argument

President appears to have

/llHi

Capital

in advance.

anti-standby faction, which the

A

Behind-the-Seen* Interpretations

be

circumstances

can

defined effectively

•

•

•

serious

is

emergency

enough to justify the attempted;
repeal of the free price system,,

Cuban

States

Council, 910 17th Street, N,
Washington 6, D. C.—Cloth.

W.

the

perennial problem of who is to

the

be trusted with

labor strike.

deciding wheth¬

TRADING MARKETS
Caribe Stores

lararaiiaiiar
-

■

«■

—-*•

-

-

*

Gorton Pew Fisheries

-

w

ih%
■mi

Washington Representative
Business consultant and economist, over 20 years in

Washington,

commercial

and

experience.

Interested in part time representation of business,

financial

banking, investment

Washington
special

or

reporting,

FOREIGN

National Co.

SECURITIES

Wide foreign

Norfolk Cy Trust Co (Mass.)
Polaroid Co. Pfds.

iS

Riverside Cement "B"
Rockwood

CARL MARKS & HO. INC.

Co.

Pfd.

Southeastern Public Service

FOREIGN SECURITIES SPECIALISTS

their

interests.

Surveys,

No lobbying. Box B 129, Commercial and

50 BROAD STREET...NEW YORK 4, N.

Financial Chronicle. 25 Park Place, New York 7, N. Y.

LERNER & CO.

Y.

TEL. HANOVER 2-0050...TELETYPE: NY 1-971




Common

fyi^.

insurance firms for the following of

developments affecting

reports, etc.

analysis.

'&%■

FIRM TRADING MARKETS

George E. Keith Pfds.
Naumkeag Trust Co. (Mass.)
Middlesex Cy Nat Bk (Mass.)

Investment

'

'<

Tplpphnn,

HUbbard 2-1990
j

r & (E' ml mi mi mi ml m) ml iz» ri ra rami fa nu

Securities

10 Post Office Sqaare, Boston
?

9, Mass.

T p'"»vd|

BS 69