Full text of Commercial and Financial Chronicle : February 14, 1946, Vol. 163, No. 4464, Section 1

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JIB
1 51946

-

Final

ESTABLISHED

Edition

-

OVER

In

100

2 Sections-Section

1

Th a

Financial
Beg. U. S. Pat. Office

Volume

New

Number 4464

163

Needed: A New Labor Policy

Britain As Lender
:

By PAUL EINZIG

Discusses

Correspondent
of

fects

Britain's

the

Ef¬

to

Her

Credits

the

:

Largest

'

Asserting That the Serious Labor Situation Will Continue, Traces Labor Developments Since the Beginning of the New
Deal and Contends That Failure of the Administration's Policies g
Has Become the Greatest Public Issue in the United States.
Holds

Is

-

Debtor

World,

and Is

Suffer-

■

Nation

the

i

n

From

g

a

Serious

Import
Surplus;
and

Extreme Short¬
age

of Foreign

Exchange.
Holds
Greater

Far

I need

•

know if you
'

labor

"

.

months and in

Exchange

my

will

e

r

v

e

Through:. Mul¬
tilateral

U. S. Loan

to

.

country in the
face
of
this

for
and

I

Commons the Conclusion of

loan

that

unfortu¬

member

nate

prob¬
lem is looking

agreement with Greece,

a

a

Mr.

of Parliament asked him whether
the
5

£10,1)00,000 loan would have
spent in this country. The:

f question
,

one;

not

was

an

unnatural

seeing that Britain's foreign

exchange resources are declining,

there

(Continued

i

which this question can be

860)

on page

tent

I think

are

of

Index

875.

Regular
>

.

Features

on

-

address by
the
MidWinter; Trust Conference of the
Dr.

American

7

Aerovox Corp.*

m

on

-

,

ifi* *

.

IIIRSCII, LIHENTHAL &

CO.

|X.<'.

25 Broad St., New York 4, N. Y.
HAnover

L

2-0600

Chicago

Teletype

Cleveland

NY

1-210

London

Geneva/Representative)

Established

1927 •,

'>

SECURITIES

INVESTMENT

BOSTON

:

^

■:

W$NG

before

Men's

sional

INCORPORATED

N.

Y. Security

REctor

8-3600

Cincinnati,

Group,

:-V£; (Continued

854)

on page

-

,

i

-Ah'

Municipal
5

Bonds

X:

New

York Curb Exchange

30 Broad St.
NEW YORK 5

THE CHASE

Members New York Stock Exchange
Members

DIgby 4-7800

1

NATIONAL BANK

New York 4

U Tele. NY i-733

OF

CITY OF NEW YORK

THE

^

LOS ANGELES 14

%

&

||l:

|

•

i

J

Dealers Ass'n *-

Enterprise 6015

;; North West fig

Preferred

Carpet Co.

v *"

-' V.'

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Solar Aircraft Company
5
90c„Conv. Preferred
1

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*•-■

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■

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f

j :

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;;

' ;'.V

•

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Analysis upon request

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5 Raytheon Manufacturing Co.
I ;

$2.40 Conv. Preferred

I

on

request

.

;

HART SMITH & CO.

Reynolds & Co.
Members New York Stock

120

Exchange

Broadway, New York 5, N. Y.
Telephone:

Teletype N. Y. 1-576

Philadelphia Telephone:

Alloys, Inc.

Codv.

Common

New York 5

45 Nassau Street
Pel.

tt£

Profes¬

and

Ohio, Feb. 1, 1946.

Hardy & Co.

■COMPANY

Tel.

The Firth

Kobbe, Gearhart & Co.
Members

Business

Cincinnati

de

^the| University

.

State and

634 SO. SPRING ST.

WALL ST.

45

Common

secondary®!!

MEMBERS NEW YORK STOCK EXCHANGE




capital, but, in

address| by',professor

*An

Haas

and Dealers

INCORPORATED

Prospectus

TELEPHONE- RECTOR 2-6300

been ex*

for Banks, Brokers

>A— |Mr Af»Pd

finance

markets

New York 5,n.y.

In recent months we have heard

us.

Service

')

HUGH
■

REctor

New

Ybrk

WILLIAM

-u-ii

Teletype, NY

Security
ST., N. Y. 5

Dealers

1-635

and

111

Assn.

York Stock Exchange
Principal Exchangee

New

other

Broadway
York 6

New

HAnover 2-0680

Bell Teletype NY. 1-395

2-8600
New York

,

IRA HAUPT & CO.
Members

Members

52

Montreal

f

very

Woonsocket

Springfield

BROKERS

o

minor
importance to

Haas

de

Bond, Department

if

New York 5
PHILADELPHIA

Troy
Albany
Buffalo
Syracuse
Pittsburgh
Dallas' ; Wilkes Barre
Baltimore
;
Washington, D. C.

BOND

14 Wall St.,

Anton

Bond Brokerage

Wholesale'Disfributon

,:k

64 Wall Street,

was

essential in promoting, a

Acme Aluminum

BULL, HOLDEN & C°

investment

of

BOlf # -

corporate
;

has

scheme to assist, through Government

PROSFECTUVON REQUEST

and other Exchanges

v..

a

Manhattan

R. H.Johnson & Co.

| i' Members New York Stock Exchange
'4

eign trade

.

.

for¬

that

ed

852)

request

this

conclud¬

they

•:/

Hirsch & Co.
Successor* tn

as

to¬

our

production

and from

(Continued on page 864)

page

on

tal

o

Invest¬

loans, certain industries which at any time are
planned economy or of fur¬
thering political aims of the dominant political faction.
Although
Government financial assistance to specific industries is not new in
Great Britain or in any other modern industrial nation, including

:.v;;}.»

Prospectus

of

,,,,,

considered

common stock

request

control

...

on

ideals,

"Control

a

This measure, which had

addition,

Sakolski

t'

than

more

10% of

Great Britain, in¬

Socialistic

its

out

Parliament

positive

Liberty Fabrics of
New York, Inc.

•

Nti-Enamel

* Prospectus

;

(Continued

San Francisco Mines

f;-.

City, Feb; 6,194.6.

to offer..

Gaumont British

Association,

Bankers

New York

j

before: J

Wolman

no

Economic

pected for some time ,and which is generally rec¬
ognized as a logical sequence of the nationaliza¬
tion of the Bank of England," carries not only a

solved.

*An extemporaneous

;

in

Bill.

ment"

Dr,;AJ,.JM.

page

carrying

on

introduced

magic formulae by

any

our

exports

amounted

J,

I don't believe

get lit its roots.

total

therefore

The Labor. Government in

solutions

way

how

out

Minds.

ought to go at this problem is

we

to

any

the

rate,

any

ity.
pointed

They

Judgments Are More
Judg¬
Resulting From the Inter-Actions of Many

ments

trade

American

pro s p e r

Disastrous to Public Welfare Than Common

in

am

Motives Over-ride

.of

nortance

to

.

Government could ill afford

;.,the
*

At

4

^

,

be

to

d

position
not having

of

Prof. Leo Wolman

.

thp im-

foreign

That Errors in Bureaucratic
'

When

mini¬

,

mized

Motives Under Government Controls, and Concludes

solutions

Bevin announced in the HotiSe of

of Having .Political

of

—

heard

which

a Permanent
Investments, Dr. Sakolski Contends That the Action Is
Revolutionary and Contrary to British and American
Traditional Policy of Government Non-interference
With Private Enterprise.
Points Out the Dangers

to Control

f I

kind

voices

many

\

oting the Action of the British Government in Proposing
aw

know that this

LONDON, ENG.

7

By DR. A. M. SAKOLSKI

,

months

come.

Agreement, and Looks

of Reducing Home Consumption.

..

|*

continue

Remedy in Increased Exports of
British Goods, and Present Policy
to

Before the war

changes in recent years.

—

Bureaucratic Investment Contiol

face •' for

some

Trading Under the Anglo-

has undergone considerable

were

judgment

to

,

,

this

which

Res

£inzig

Says U. S.

4 > The attitude of the American people with regard to foreign trade
—

problem

ing Loss of Its
Paul

University

Foreign Trade Speecialist Holds There Is Too Much Optimism
Regarding Export Opportunities and Points Out It Is Neither Wise

oInternational Cartels.

already heard and what you
had heard nothing about itr that this is a pretty serious
what you have

not repeat

country has
been facing in
t h e
v 1 a s t

Is

j

HAAS*

Professor of International Relationships, Harvard

{ Nor Profitable to Step Up Exports to $14 Billions.

Conditions for Which Govern-

Investigation to Remedy the Lawless

:

to Britain
Forthcom¬

ger

T

de

;j Export Activities Will Create Cutthroat Competition With Other
| Collective Bargaining and Declares That There; Is Now No Clear;
Cut Workable Labor Policy.
Says Wagner Act Is "Compulsory !'• -■} Countries and Will Lead to Unsound Foreign Credits. Contends
| Our International Financial Relationships Are Lopsided, and Sees
Unionizing" Legislation Without Means to Prevent Lawlessness or '
of Promoting Peace, and Urges a Full and Extended Congressional 'fi?. /f Danger in Rapid Relaxation of Trade Controls.. Favors Private

Dan¬

i

17

Denounces Government Interference in

and Doomed to Failure.

Prosperity

ANT0N

Attempt to Separate Wage Increases From Prices, Is Unworkable

.

in

American

Labor Expert,

.

Herself

Britain

Great

Copy

a

Foreign Trade and

Professor of Economics, Columbia University

...;

Price 60 Cents

J4, 1946

By LEO WOLMAN*

Former Allies Under Conditions in

Which

York, N. Y., Thursday, February

.

C

Toronto

REctor

2-3100

10 Post Office Sq.
^
Boston 9

* Hancock 3780

Tele. NY 1-1920
'

Direct

Private

Wire to

Boeton

THE COMMERCIAL & FINANCIAL CHRONICLE

Trading Markets in:

m.'

-

ft Hundred and

Consolidated Ind.-Units

>X'.r'

■

American Phenolic

!;

/:.

Members

Security Dealers Ass'n
Dealers, Inc.

Nat'l Ass'n of Securities

HA 2-2772

Bxohange PI., N.Y. 5

40

BELL TELETYPE

P. R* MALLORY

on

"

Monetary Policy

Spahr Condemns Attacks on Private Enterprise and Private Capitalism. Asserts These Attacks
Mean the Replacing of Our Free Institutions by/the Autocratic Governments Against Which We Fought,
Decries Trend Toward More Central Government and Less! Individual Freedom^ Particularly in the
Field of Competitive Business;
Holds Competition Cannot;Oparate Unless There Is Both Economic
and Political Democracy and That No Bureaucracy Can. Meet the Efficiency or Intelligence of the
People When They Are Free to Vote Their Dollars as Tfiey Taink Best.
Claims Government Has
Allied Itself With the Employee Group, and Class S jrugg!e Is Encouraged, y Condemns Government in
Business and Says That Liberalism Is Distorted From Its Historical Meaning.

Established 1920
New York

Secretary, Economists* National Committee

' /

& C0«i INCi

Dr.

Corp.

Lanova

Professor of Economics,. New York University
:

Aircraft & Diesel

Forty Million Partners

By WALTER E.

f Miss. Valley Barge
'

Thursday, February 14, 1946

NY 1-423

Sought

Sold

"*-»

——

Steiner, Rouse & Co
Members New

York Stock
Exchange
25 Broad St., New York
4, N. Y.

{

HAnDver 2-0700

In the 157 years

tion of
of

our

this

since the adop¬

N ew

Constitution, the people

Quoted

Direct wires

,

NY 1-1557

Orleans, La.-Birmingham, Ala.
to

branch offices

our

country have reached the

highest level of living of any nation

o^n earth.

of Texas

Getchel Mines

Electrol
Bought—Sold—Quoted

Rands, Inc.
Mar-Tex Realization

Soya Corp.

Billing & Spencer

Exchange
120 Broadway, N. Y. 5
WOrth 2-4230
' :
Bell Teletype N. Y. 1-1227

Members Baltimore Stock

Members New York Stock

:

Exchange

Members New York Curb
Exchange

FOR SALE

50

Broadway WHitehall

4-8120
Teletype NY'1^1919

Bell System

W.&J. Sloane

vidual
dom

•

free¬

and

the

a

•

Members

Curb

York

New

of

series

Eastern Footwear

and on the Con¬

tinent against strong- central

Exchange

Common Stock

of
rebellions of people

here, in England,

Vanderhoef & Robinson

♦

.

,

enterprise, and at the end

vate

Common

Central States Efec.
(Va.)

Dr. Walter E. Spahr

virtues of pri-

Company

auto¬

Bowman-Biltmore Hotels

'

cratic governments.:?

v PW. & Com.

,

31 Nassau Street,

New York 5

Telephone COrtlandt 7-4070
:

;"

1

!

BeU System Teletype NY 1-1548

The

private enter-

system of

and

prise

capitalism,

private

Fiank C. Maslerson & Co.

address by Dr. Spahr at the
Western
Reserve
University,
Cleveland, O., Feb. 8, 1946.# H
& f Ah

Byrndun Corporation
Common

Lincoln

u

'

Stock

;

Buckeye Incubator

;

,

Atlantic Refining
$3.60 Pfd. '

Alegre Sugar

Capital Stock

So. Advance

'

Bag & Paper

Common

Members New York Curb
Exchange
WALL 8T.
NEW YORK B
•
HAnover 2-9470

t>;-.

Bldg. Corp.

Capital

Punta

(Continued on page 858)

"

Preferred

&

64

Teletype NY 1-1140

'

A. S. Campbell
Common

-

Consolidated Film

Xp-'X?

XJl'.t?'xV*\•■;>•''.-'."vV>V: h'("

Cayuga & Susquehanna

?v.'^

Chicago, Mil., St. Paul

Bought—Sold—Quoted

£

Telephone WHitehall 3-1223
Bell Teletype NY

bfC PONNELL & fo

1-1843

York Stock Exchange

*

New York Curb Exchange

BagdaJ Copper

r v

Tel.

Boston.& Maine R. R.
Stamped Preferreds

Common

&

REctor 2-7815

<•%

\

tL

X'Soi

St;, New York 5, N.Y.
•

'

"

Teletyp. NY 1-99S

Markets in U. S. FUNDS for

Punta

& PAPER, Common & Preferred
BULOLO GOLD DREDGING
MINNESOTA & ONTARIO PAPER

ABITIBI POWER

Works

Preferred

Alegre

Sugar Corp.

NORANDA MINES
STEEP ROCK' IRON MINES

.

Quotations

Upon

•/

Members N. Y. Security Dealers
37 Wall
Bell

St., N. Y. 5
Teletypes—NY

Assn/

.

&

FARR & CO.

1127

Members

New York

St. Paul, Old

Members N. Y. Stock Exchange and Other Principal Exchanges

Pfd., & Common

115 BROADWAY

Denver Rio Grande, Old Pfd.
,

Telephone BArclay 7-0100

- ;

NEW YORK 6, N. %.

Missouri Pacific, Old Pfd. & Com.

|

New Haven, Old Pfd.\& Com.

s

New York, Ontario & Western
j

>

Rock

Stock

Exchange

WAUL ST., NEW YORK
T^L. HANOVER 2-9612

J

,

Electronic Corp.
America

of

DELAWARE POWER
& LIGHT COMPANY

Old Common

Harrisburg Steet\Qorp.
{

Island, Old Pfd. & Com.
Seaboard Air Line
oid

pfd.

&

^

Kingan & Company
:

Common

com.

.

f

Common;

BOUQHT

—

SOLD

—

♦Prospectus Upon Request *

!

York

Coffee & Sugar Exchange

120

Teletype NY 1-672

*

New

Frisco, Old Pfd. & Common

!

;

Request >

V

Canadian Securities Dcp't.

Hanover 2-4850
1-1126

& Co.

Members New York Stock
Exchange

Dlgby 4-7060

WeMaintain Active

England Co.

United Piecs Dye

Consolidation Coal

-

Luscombe Airplane

Northern New

ft M;

1 Wall

NEW YORK

120 BROADWAY,

;

Gude, Winmill

Members

New

& Pac.

56/2000

20 Pine Street, New York 5
,

Intl.

Republic Pictures

-

1

Western Pacific
Old

Pfd.

&

Com.

G.ASaxton&Co.flnc,
170 PINE ST., N. Y. 5 WHitehall 4-4970



;

Simons, Unburn & Co.
--

Members New York Stock Exchange

25 Broad

St., New York 4, N. Y,

HAnover 2-0600

Tele. NY 1-210

International Ocean Telegraph Co.
Pacific & Atrantic Telegraph Co.
Southern & Atlantic Teleg. Co.

Empire & Bay States Teleg. Co.
bought

Bought—-Sold-—Quoted

•l!'-': !'']

Teletype NY 1-609

QUOTED

Western Union Leased Line Stocks

Members N. Y. Security Dealers Ass'n

fl4 Trinity Place, N. Y. 6

HA 2-2400

Teletype NY 1-376-377
Private Wires to Cleveland
Detroit

-

Pittsburgh

-

St. Louis

*

sold

.

v

quoted

v

J-G White 6 Company
INCORPORATED

37 WALL

STREET

ESTABLISHED 1890

Tel. HAnover 2-9300

Arnhold and S. Bleichroeder

NEW YORK 5

Tele. NY 1-1815

INC.

30 Broad St.
WHitehall

3-9200

;•

.

*

New York 4
'

-

Teletvoe

NY

1-R13

THE COMMERCIAL & FINANCIAL

Number 4464

[Volume 163

The Credit to Britain

Fav

iiCHitnsTEir

-

Angeles, in Letter to Rep. Anderson, Takes>
Issue With Mr. Chamberlain, Who Wrote on Identical Subject.
By HON. JAMES F. BYRNES*
Says We Should. Hatie Wo Fear of Competition of British Socialism |
Secretary of State
and for Our Own Welfare, Should Make Generous Loans 4o War :
Allies.
Holds if Dollar Wealth Is Inflated We Deflate the Relative { A Secretary Byrnes Endorses the Proposed Loan to Great Britain as '
Value of Debts, and Predicts That Because War Debts Were Created j A' Indispensable to Our Economic Alliance With Her, as Well as to [
; an Expanding World Economy.
He Stresses the Advantage to Us !
Out of Nothing;They Are Mere Hallucinations, and Must Be Paid A
; in Terminating the Sterling and Empire Preference Pools. Although A
With Something Equally Unreal.; Warns Against; Erecting Tariff j
Citing Britain's Economic Plight, He Decries the Talk of Eventual
; Barriers Such as Hawley-Smoot Legislation.
■
A Default—Holding That the Concurrent Removal of Trade Barriers
The "Chronicle'*, has received a copy of a letter/of John L. Rowe,
A Will Insure British Solvency. . Denies That Loan Would Set Pre¬
of Los Angeles, CalV addressed to Congressman J. Z. Anderson (R.,
cedent, Declaring That Other Countries Can Borrow Through Our
Cal) in reply
of January 24th carries the con¬
to
a
similar
Government Lending Agencies.;
Also Combats the Argument That

And World Trade

John L Rowe, of Los

'

831

CHRONICLE

AND COMPANY

'

TOO YOUNG

"

*

letter
li

Saratoga, Cal.
which

views would

was

ih

our

issue

Jan.

24,

points:

of

published

1.

not

litical

p.
371)
text
of

163,

the

know!

But don't worry—

we're still young

and gullible enough

to

young

to

take them off your

,

.

Dept.

YORK

STREET, NEW

WALL

99

hands!

Obsolete Securities

a

Telephone WHitehall 4-6551

filled with

Works

Dye

Piece

agreement with respect to the dis¬

Iran

putes over Iran and Greece.

1Univis jLens\A ivA.'';^

11

subjects of di¬

these

public expression of
divergent viewpoints re¬
us

the

Yet

have been the

A;

United Artists
United

Greece

and

British is

purposes.

those obsolete

bought

stocks and bonds when you were too

which have been aired these past weeks in

Security

Council.

loan, but a gift for po¬

a

and the radio broadcasts have been

accounts of the disputes

■

The advance to the

(Vol.

The newspapers

this loan.

opposition to
summation of Mr.
lent

of

you

the Credit Would Contribute to Inflation Here.

vio¬
A
Chamberlain's
cover the following
«'
7A;

Chamberlain, who expresses

Cham¬

berlain

Mr. William

of

views

troversial

Wil¬

of

am

KNOW

TO
Maybe

Jefferson Travis

of the difficulties which

rect and frank

minds

R owe's

nation, we have emerged
from World War II essential¬

debate,

stand in the way

letter follows:

ly weakened in terms of ma¬

ticularly

be¬

international cooperation.

tween

the

wish that these difficulties did not

T h

e

Mr.

{

Most

one

2.

and' in-

Union and the

the

4. That inflation

fuel

new

^ c;$3,750,000,006 li^ie of credit

I

feel

that

open

.

Chronicle

-

A

Teletype NY 1-1203

/vA"-- 'A-A A;

tion,1 New; York

Byrnes

City,

Feb.

(Continued

Has not prevented

"

on page.

LABORATORIES

11,

Afc

,

^

Open discussion

ALLEN B. DU MONT

address by [Mr. Byrnes be-,
Foreign Policy Associa¬

1946.

James F.

the contrary;

&£?¥'■A;A*•

'}

:

' Ai'ii'A''

A-'•

-

Circular

•

Request

on

866)

Confusion Worse Confused

On the Continent

39 Broadway

HAnover 2-8970

the

fore

for

alarm." Qu i te

Financial Reconstruction

'

AflAV. New York 6, N. Y.

I

to remove it. The problem

y

these

cause

Members New York Security Dealers Assn.

financial dilemma into which the

disagreements
is

J. GOtDWATER & CO

..

have in mind is the economic and

the

discus¬

of

sion

price control is but Aa
futile 'attack against the virus
(Continued on page 856).*■:

The Com¬

Financial

ain.

dangerous

a

ing

cannot

Mds

5. That

Which President Truman has em¬

phatically "endorsed.

to

flame.

of Great Brit¬

is upon us and

the loan-to Britaiip Pnly

John L. Rowe

oppose

and

representative

Vtrhisic value/

'Ous-A reasons,

mercial

substance

of

thing

to

Soviet

the

of

of wholehearted
We may

exist, but we will He ill-advised
ignore their stubborn presence.
A I; wish* to discuss one of the
most important: of these: difficul¬
ties and about our plan for help¬

representative

British,
but for vari-

they

par¬

3; That the Federal paper which
our Nationals hold
is not a

and

love

admire

a

terial resources.

every¬

professes

to

As

J. F.
*

*

Reilly & Co., inc.

*

Members

i

New York Security Dealers Assn.

■

-

.

"

By WILLY DREYFUS

,

~

<

j

Swiss Banker Declares TTiat Elimination of the Acute .Shortages
r

Causedby the Wat* Must Precede Any Definite Financial Recon- <
struction in Europe.
Close Economic Cooperation Between The }'
Continental Countries Depends on ; a Uniform and Unalterable ]
-Relation ol Their Currencies to itjoM. 1 Prance,* After Clarification;
'of Her Domestic Politics^ Is the Country Destined to

.<

Europe's Financial Leadership, f

'

Propriety of Charges Based dd Special , Services,
Posed, Definition of "Broker^ Under the Securities
Act Considered. Multiple arid Conflicting Opinions
Referred to. SEC Urged to Make a Statement to

v

a

i|;r clealerpsks that his

-

ican

It lasted only

typical example.
six months.

France, having been

learn some¬

thing of value?
In
the
cen¬
tury that pre¬
eWorld

.

the

beginning of the Nineteenth
after
the Napoleonic
Great Britain owes the
fact that it finallyovercame them

only rel¬
atively -short
and unimport¬
ant wars. Ex¬
were

in

cept

■Franco

-

Ger¬
of

,

Willy Dreyfus

Banks

<—>

on page

Brokers

theAw^,:,v:;:v;
^military issue was decided; with¬
hold the mobilization
of great
armies.
The ma j or part of the
-military equipment was prepared

—-

850)

•\

We

view

and
i

convulsions in
international econ¬

n

TITLE COMPANY
CERTIFICATES
[i£ond & Mtge. Guar. Co.

■

,«•'?

«

>vV''

"•>"

.j,

<■

■

•

*

r

'v '.v

-

timely

Eastern Sugar

U: S. Sugar

General Aviation Equip.

and Industrial

®AA^:°AA'

'issue

latest

Service

l

v

'

•

,

25 Broad Street, New

f

"

Members New York

York

NY 1-5

AN. Y. Title & Mtge. Co.

32

Prudence Co.

sent

York

Broadway

DIgby 4-8640
Teletype NY 1-832. 834'

11

1
WHitehall 4-6330

Members New York Stock Exchange

on

request. 3

40 Wall St., N.Y. 5
Bell Teletype NY 1-2033




Private Wire

NY 1-956

to Boston

;

'

^

'

:•

Vj

iy.-;

.-f

•

A

[AA Stromberg-Carlson

Common and Preferred

•

*

Asali

Co.* '

& Trust

American Bantam Gar
t

Bought—Sold—^Quoted

National Radiator
lid*?:

i

:'

;

w

,

Co.*

*Analyses available
to dealers: only

;

„

Board of Trade BIdg.
CHICAGO 4

HotiR9SF.8TRRsrm

Harrison 2075
Teletype CO 128

Direct Wire Service
New

■

•

Public National Bank

of f our

Security Dealers

NEW YORK 4

Newburger, Loeb & Co.

York 4, N. Y.

"

.

New

Security Dealers Assn.

WHitehall 3-0272—Teletype

Telephone HAnover 2-4300
Teletype
.r
Members New York Stock Exchange

STRAUSS BROS.
Members

A^

■

25 Broad St., New

"GEARED TO THE NEWS" Bul¬

letin

Assoc.

'

OF THE FUTURE
of

■

WOrth 2-0300
System Teletype NY 1-84

Purita Alegre Sugar

t,j>:

THRESHOLD

Lawyers Mortgage Co.
Lawyers Title & Guar. Co,

$

Bell

Spencer Trask & Co,

'

review of factors making for 1946

Copy

Security Dealers Assn.i

Broadway

DUNNE & CO.

amaz-

g

prospects:

.|1

Members New York

YEAR"

You will want to read the

■

PREFERRED STOCKS

year ago

the

Ely Lab. Pfd.

JltBiolS [o.S
170

High Grade

re¬

comments.

without any great

The. -War of 1870-71 is a

a

v>'

Public Utility

foresight
revealed by its

Iburdens could therefore be borne

omy.

Reeves

f

"The A CONFI¬

[before the outbreak of war and,

and

r.,

Lea Fabrics

Dealers

DENT

Ano industrial conversion was nec¬
essary during it. The financial

f national

Sargent & Co.
0mttl%* & Spencer o

interested in offerings of

are

member our re-t

;

v

-

1870-1871

YouA may

-

ThiokplCorp.

Wars.

(Continued

^A ^AA-

(Continued on page 876)

Century

the

war

man

particular'situation than does any one else.
example, last year one of our partners studied
the reports of a particular railroad; he then interviewed
at length the top officials of that road; then, .a trip
was made over the lines, shippers were interviewed as
"For

Incomparably graver were the
difficulties -England had to face at

there

I

War

we

particular situations to such axi "extent that
honestly believe we know as much, or more, aboyt

some

its national indebtedness.

ceded

Kingan Co.

.

librium within a few years with¬
out altering the parity of its cur¬
rency or; the^ ipommal^amount *of

and

1940

:y:i<-i"

..v

Haloid Corp.

studies of

5,000,000,000 gold francs besides
own war expenditure.
It was
able to regain its financial equi¬

events since

to

& Los Angeles

TRADING MARKETS

A:

its

war

1-2733-34-35

recently received, in which the

name* be withheld;»

of

com¬

one

letter

effecting transactions in# securities for the accdunt
of others. .' * Our small firm specializes in exhaustive

defeated, had to -pay a reparation

pare the

NY

Wires

Chicago

t

2-4785

Teletype,

Private

of

upheaval

mast

System

v,;; Boston,

point has not
been missed in various discussions of the 'Oxford Case'.
Please note that the quotation rfrom1 Section 3 (a) (4);
defines a broker as 'any person engaged in the business

economic

spheres.
But
iwith what

HAnover

>

Bell

have wondered if an important

"We

A,When one tries,to foresee; future developments one is inclined
\
This is also true in the political
to make comparisons with the past,
and

40 Exch. PL, New York 5, N. Y.

Settle the Unrest.

Take D?er J

.

f

C. E. Unterberg &
Members N. Y.

Co.

Security Dealers Ass'ti

'

A

-A;

'■

.Established 1914

>.

York—Chicago—St. Louit
Kansas City—Los Angeles

74

Trinity Place, New

York 6, N. Y.

61

Broadway, New

York 6, N. Y.

Telephone BOwling Green 9-3565
Teletype NY 1-1666

THE COMMERCIALS FINANCIAL CHRONICLE..,.'.;

Thursday, February 14, 1946

and the Bad in the
Ry DR. MELCHIOR PALYI

ling Case Anti-Strike Bill
By THEODORE W. KHEEL
/ \
Executive Director and Public
Member,
£

National War Labor Board '

i

.

>

|

yby "Freezing" Bank Portfolios

(

^

^

.

>

Finding, and Creates

I

Air Cargo Transport!
American Bantam Car

I

S. F. Bowser

|

Tripartite Board Which Is Preferable

a

More Carefully Studied Prior

Entire Subject Be

Com. & Pfd-

months

several

For

Cinecolor

to

for

Christ¬

mas.

ac¬

Getchell Mines

request

Hartford-Empire Co.
Kaiser-Frazert

■

'

Mohawk Rubber

'

National

I

Fireproofing

Polaroid Com.

I

Sheraton

I

Corp.

work

on

Manufacturers, recognized

Airways

an

.

it

to

then

submitted

innocuous

bill.

a»

Not that

it provides.

3 There

are

j.

.

.

cast

page

848)

j'

debt

I
.

]

j

^

request

I

WHitehall

3-4490

^Electronic Corp.

^Simplicity Pattern

f Bishop & Babcock

fYork Corrugating

.

Circular

upon

*ML H. Lamston

*

Prospectus and Special Letter Available
tStatistical Study or Special Letter on
Request

Stand. Gas & El. Com.

or

devil

to

at

least

.

to

the

economist

an

Reserve

Board

interestirig-bearing, noh-niaturint

be exorcised.

bonds—in
the

for

Low and lower

f ixed

a

volume

of

proportion ftp

deposits—arousqs

wide interest is not because of tlie

(Continued

The

on

869)

page

COMMERCIAL

and

FINANCIAL CHRONICLE
Retr. IT. S. Patent Office

interest rates

•

v

•

V

political

a

,|lv

•

,

(Professor L. H. Seltzer).
The reason why the program of
freezing bank portfolios, or .a
large portion of them, in very low

necessity because
public sentiment would not toler¬
ate a continuously growing bur¬
den of interest charges. Also, they
are

fLe Roi Company

Iowa Pub. Ser. Com.

*Bulletin

attached

William B. Dana Company

.

,

Publishers
25 Park Place, New York 8
'

REctor 2-9570 to 9570

.

imperative because of the fact
that some 60% of all bank depos¬

Cent, States Elec., Com.

FIRST COLONY CORPORATION

f Prospectus
Upon Request

out, it appears, by

may : be

deflationary, arid defla¬

the

jective,

*2.

Broadway, New York 4, N. Y.

American Gas & Pow.

•

is

"<

are

Puget S'nd P. & L. Com.
'

The

New

is neither
wanted.
That

nor

':

by Professor S. Leland,
Chairman of the Chicago Reserve
Bank, a proposal originally worked

depressions
which are, of course, a matter of
arbitrary definition. We may be
in "depression" once and forever,
short of a forced full employment
(which would necessitate deficits,
too, and bigger ones at. that). ; :

Teletype NY 1-960

Iowa Southern UtiU

the

V?

>

lately

Debt redemption

would be

I Textron Wrnts. & Pfd.
11

facts.

of

'

the gist of the proposal announced

iOn the contrary, the continuation
of deficit-financing is, the first Ob^

Interesting Situation

United Piece Dye

hard

and

objectives

expected

Alabama Mills*

|

wishes

:l

•

day; by: freezing the bond
portfolios of the banks. This is

conflict between

a

Deal; financial * policy

:Walth'MnWatcli

on

as

'?

evil

summed up as follows:

Transportation Co

Circular

I

arises

1.

Warren Bros. "C"

they

t

Gulf Atlantic

; ;

what

is

-

Freezing Bank Portfolios

The New Dealish solution of the
dilemma consists in postponing the

•

tion

S

That

/y y/'v

;

by■ ^'managing the debt": to
keep: the house of paper cards
from: toppling over* and keep it
expanding,v too., y f-.
y ;;
y
The : problem of the national

really! two parts; to

(Continued4 oh

,

»

i

mean

U. S. Air Conditioning

United Drill "B"

public, but
price of creating a bankihg
or support
old and new
deficits by the printing
press; arid
take a chance on a
run-away in¬
flation.

crisis;'

start

certificates.

to.make the

:so: as

bonds attractive to the

at the

balancing of the budget. But they
to
realize
that
something
more is needed than just printing

For better

wishful
«

est;„rates.:rise

(

of..

buying

(ending
the
socialistic
policies
which it finances);* let; the inter-

••

soft

Upson Corp.

-

debt

per se—by no
continuity and regularity of means. .Since
employment, industrial peace, and the liberalism
the uninterrupted production and
of the pseudo-y
Dr. Melchior Palyi
distribution; of goods and services
liberals
con- i
for commerce".,
;
\ sists in
liberally spending other
The theory seems to be ■» this:
people's money, they do not con¬
first you legislate, then you inves¬
template either the gradual reduc¬
tigate tc>; find out what legislatiop tion of
the debt or even a true

United Artists

|

they

worried
the

of

from

eral
Reserve be called upon to
support the bond market by in¬
tensified money printing, j and - if
so, what Would happen to com¬
modityprices?
In
short,
t|ie
choice is between " several "evils,"
every- on e of which would v wreck
the; New' Deal:; stop the/deficit

about the size

problem that prompted the Presi-

House

e

mote

and

proposal

up

are

refrain

indi¬

bonds, to say nothing of liq¬
uidating them? Should the Fed¬

much longer.

point of both labor, industry, and
the public to determine what ad¬
justments are necessary to pro¬

wateredrdpwn,

The

b

to

arid

rates

and

more

problem

cannot

hushed

would

viduals

that

sense

the

market

thereby ^ induce banks

trusters" begin

this bill., The first deals with the
settlement of labor disputes, thie

President's

,

the

or worse, one house
Congress ha? now" passed this
bill, so let's take a look at what

elab¬
orate plan for legislation, that he
did -not favor "hasty" action by
Congress.
v
>'
The House
Labor Committee
held hearings for several weeks
oh, the

or

"brain-

ficial

,

is necessary. '

submitting to Cohgress

Investments.,
Velocity of Monetary Cir¬
of Stopping Monetary Inflation Caused
by Government
v'^y-yy;:'
" : ;.:;-vy

and

if in

in

Thiokol Corp.

|

to

this the other day when he said,

Sylvania Industrial
Taca

went

agement relations from the view¬

President of the National Associ¬

| Stand. Comm'l Tobacco

:

—

my

ation of

and

create, should
"make a broad and comprehensive
study of the field of labor-man¬

Although it
may be diffi¬
cult to imag¬
Theodore'W. Kheel
ine, the fact is
that our already troubled labor
situation ; could..
grow "
worse
through, ill-considered, 3 speedilypassed^legislation,^ Ira sT^sher;

Kingan Co.

r

aside

which

and
judg¬
ment, that was
all to the good.
in

j,

to

the President's

|i Gt. Amer. Industries*

culation

Deficits.

•

apology for its undue
haste, the House wrote into the
bill a provision that the LaborManagement
Mediation
Board,

some¬

responsive

1

of Congress have been
It began this time when the

As

what less than

|

Government Which Culminated in Nationalization of

Bank of England and British Government Control of
Concludes There Is No Way to Control

Legislating.

vote of 258 to 155.

a

:

Congress
was

to the

ances

1"

a debt of, $300
billions, overwhelmingly short-term
constantly growing, is as safe for a nation as it is for a family
the Case bill which had not been
to keep a.rap¬
considered by any; Committee of
the interest rate be reduced} br
idly
matur¬
Congress. After three days of de¬ ing tiger as a
even kept low, if more and more
bate
on '
this
bill,v which got pet in -the
debt-certificates
should
be
is¬
amended in a variety'of ways oh back
yard.
sued? What if an industrial boom
the floor, the House passed it by
Even the offiwill raise

He

year.

tion by

to

|

Houses

this

Congress in

asked

General Tin

an

v

Keeping

To live with

November : of
last

General Machinery

j

.

ing"-'proposal

Douglas Shoe*

|

'

.

his "fact-find¬

j Dayton Malleable Iron*
|

both

now,

toying anew with legislation on labor.
President sent

,1

to

He Indicates Further That Many of the Bill's
Provisions Are Unworkable and Confusing, and Suggests That the

All-Public Board.

Ineffective in

as

: Interest Rates Low and in Avoiding Inflation.
Says, to Be Work- S
| able, It Would Mean an AIl-Round Freezing of All Deposits and
v
Savings, and Would Lead to a Black Market in Credit. Sees a Pattern of Freezing in British System of Forced
Lending of Bank Bal¬

the Provisions of the Case Bill j
With the Settlement of Labor Disputes. ».Mr, Kfieel ConThat the Bill Properly Stresses Mediation Instead of Factv!
*

|

y^y
National Debt"

Proposed by Dr. Leland and'

"

Labor Official Analyzes

Former

as

Prof. L. H. Seltzer and Attacks the Plan

(if:

Ty

Dr. Palyi Analyzes the Scheme of "Managing the

y

'

i

'•

t

•

Members New York Security Dealers Association
Wall Street
New York 5, N. Y.

52

request

i

Tel. HAnover 2-8080

,

Teletype NY 1-2425

.

its and 45%

of life insurance

Herbert

sets consist of bonds, the denreci-

■

Thursday, February 14, 1946

;

But these

objectives

patible with

one

are

Published

every
(general
*

•

twice

can

v

week'

a

Thursday

news and

advertising issue)

and -every

Monday-

(complete statistical issue—market
tation

records,

corporation,

quo¬

banking,

news,

etc.)

Other

Offices:
135 S. La Salle St.,
3, 111.
(Telephone: State 06131}
Drapers' Gardens, London, E. C., Eng¬

incom¬

another. How

,

.•:

cleanings, state and city

velop.

I i

'<

William Dana Seibert, President

And

Cheap Money is
part and parcel of the wealth reiistribution ideology which is par¬
ticularly hostile to the income of
"rentiers," bankers, and similar
.mdesirable people, v
♦
'3.
'Lastly
prices
may y rise
slowly and may stay high, but no
run-away
situation
should
de¬

Seibert,

William D. Rlggs, Business,
Manager

ation of which would ruin the in¬

stitutions.

D.

Editor and, Publisher

as¬

Chicago
1

land,- c/o Edwards & Smith- ■$::&*«
Copyright

'

UPSON

.

.<

FASHION

-

Ilartf'd 6111

Buff. 6024

on

request

3,

Greater New York Industries

•

.

1879.

Subscriptions in United
Possessions, $26.00 per year;
of

Canada,

Cuba,

>

Seligman, Lubetkin & Co.

•

Bos. 2100




.

•

•

41

-

i.

...

-

Members

Broad

New

Incorporated
York

Security

Street,'New York 4

J.K.Rice,Jr.&Co.
Established

'v.'.''

Dealers Association

-•■v'

HAnover 2-2100

Members

rieif

A'.

Y

1908

Security Dealers Assn

Broadway
Oysiem Teletype N. Y. 1-714

rfc;

-

2

-•

J

■' •*.

$27.50

America,

per

States

in

year;

ana

Dominion

South

and

Spain,

Mexico, and
Britain,
Continental Europe (except
Spain), Asia,
Australia-and Africa, $31.00 per
year.

Request

on

by William B. Dana

Company .; t f O*.

Reentered as second-class matter Feb¬
ruary 25, 1942, at the post office at New
York. N. Y., under the Act of Marcn

Kingan & Company

ectus

Circulars

1946

.

;

:

t|

Chicago and Phila.

ENTERPRISE PHONES

Gas*

Kaiser-Frazer

PARK, INC.,; Common

Descriptive

1-1287-1288
to

Propane

Central

REctor 2-8700
"N. Y.

KENDALL COMPANY
SHATTERPROOF GLASS...

,

,

120 BROADWAY, N. Y. 5

Direct Wires

uburban

.WELLMAN ENGINEERING CO.

Members N. Y. Security Dealers Assn.

,

-

COMPANY

>00— 120

•

$29.50

per

year;

Great

'

:
Other Publications
t'-/
•
Bank and Quotation
Record—Mth.$25 yr.
,

Monthly Earnings Record—Mth.. .$25

yr.

NOTE—On account of the
fluctuations
in the rate of
exchange, remittances for

foreign subscriptions and advertisements
must

be

made

in

New

York

funds.

4.

'

■

Volume

•

liabilities. Among these
the-Federal "Housing Admin¬

if remote,

iifBalance the Budget
,

0?$i

By MURRAY SHIELDS*

]

,

*

is1 obligated to
issue billions of dollars of Gov¬

'

ernment-guaranteed debentures if
it .becomes
necessary 1 to
repay
holders of insured mortgages; the

- •

Prominent Bank Economist States That the Budget Must Be

Balanced Because
(1) the Debt Is Too Large; (2) Financial Institutions Depend on Government
Credit; (3) It Is Necessary Insurance Against Inflation; and (4) It Is Needed
Give the Federal Reserve Freedom

to

Use Its Powers. Mr. Shields Urges

to

Federal

Debt

similar:'obligations

Few

de-

had

obvious, old-fash¬
action; and

The

destiny

pends

on

ioned,

»

now

common-sense

that

*

■

respect to the

>

.

nancing
war

post¬

key-piece: i
the

;

cannot

:;

n

whole

nomic

picture.
•«

m

ible. evidence

can-/

we

able

pensable element in

designed to

prosper-;

tion..

ity by tinker- :
ing with gold,
by central'

I.

balance

submit

has

substantial

i
t.

.

•

.

^

'

■

.

are

that condi¬

reasons.

■■

r

'

>

.■

,

_

:•

Budgetary Balance Necessary Be¬

of this because it is clear from our

be close to

cause

First,

large.

By the

is

al¬

of

end

of

ure

bursements. There
Government

at

may

the various

are

time

some

need

more

contingent,

to meet their

money

Which

corporations

CA

not

need

$275

applies to it.
or

The fact that

450%,

in

the

past

Assoc. Tel. & Tel.
Brown

Bulolo Gold Dredging

Electrolux

JackWaite Mining
Kirkland Lake Gold Mining

Massey-Harris Co. Pfd.

Nipissing Mines
Noranda Mines

Pend Oreille Mines
"

the community

for
that

ourselves' and it is

as

Steep Rock; Iron Mines
Sun Life Assurance

true of other

New York

five

-

Chicago

St Louis

-

Kansas City

•

-

Los Angeles

V--v?'

t

-v'- 32

,s*vi

c

v.* ^

•

,1

-

Board of Trade

PugetfSpuiid

-j

Bldg.

Power j&!

CHICAGO 4

DIgby 4-8640.
Teletype NY 1-832-834

1

-8*?>

v

,v*

YORK 4

NEW

Prodis, Cdrnmbllv5una

-f *

«&*,»Tt*

Broadway

|

i

§E

V Harj&son

Teletype

2075

CG

t

129

KANSAS CITY

Pfd.

Quarterly dividend paid January 15,1946

^

Mills Corp.

Dividends paid 1945

Rademaker Chemical:

A

V

-

Reda Pump

Associated Tel. & Tel.

Soya Corp.
r?>

i

Stand. Fruit & S/S Com. & Pfd.

1 3'

n y yrV (,'/ *

f

—

Stove

$.75

—

34%

i

M

-

,

-

•

>

k

-

<("*.

t

^
*

1

8

'

ottlen & Company

.J

Established

United Piece Dye Works

-

HoiiRsseSTrsster

30

...

/

Members New Orleans Stock Exchange.

67^ Wall Street, New York

*

Telephone

HAnover

Specialists in Soft Drink Stocks

New .York 4, N. Y.
41 Broad St.' s"f -V

2~933S

Bo. 9-4432

Teletype NY 1-2630

'

74

New Orleans 12, La.
■.

•! Carondelet Bldg.

Trinity Place, New York 6, N

,

.

,

/

Securities Co. of N. Y. 4 %

.

American Cyanamid

i.

is

sotiv

>

j.a;,to

"

'

oi

/

-,J

;

Eastern

ANALYSIS

Uniist&d

ON

REQUEST

N.

Sugar Associates,

H. & H. old

Petroleum
Tennessee

common

Heat
Gas

Securities

Common
&

is

/

preferred
^

& Power Co.

!

MICMAEL HEANEY, Mgr.

WALTER KANE, Asst. Mgr.

& Transmission
8'

,'v
'J.'

Curb and

Missouri^.Pacific old common!& preferred

' •

?

;

Preferred

Company

.

'y'/

America

■.

.-

Consolidated Electric & Gas pfd.

N. Y.

,.y

Consols

Farrell-Birmingham

MiwTi'-'-'&fT

1-1017-18 & 1-573

Direct Wires to,
-"Los Angeles antf New Orleans v

.

,,

.,

oration

.

.

Bell Tel.—NY-1-4!)S

HAnover 2-2600

Teletypes: NY

Teletype: NT 1 -375

Telephone: BOwling Green 9-7400

YORK 4, N. Y.

Telephone:

Y.

1922

BROADSTREET
NEW

.

T. 1. FEIBLEMAN & CO.

& CO.

.

United

New Analysis on requesti

ESTABLISHED 1914

lAMES M. T00LAN

and Preferred

$2.25

—

Approximate selling price

Preferred

6%

Common

PANAMA COCA-COLA

Corp.

Lane Cotton

Telephone Bond & Share

,

\-:t

Whitehall 4-5263

Jeff. Lake Sulphur Com. &

Associated Tel. & Tel.

Light

Common

Republic Pictures

Pledger & Company, inc.

■

llarvill

Preferred

1

Baum, Bernheimer Co.

White & Company
ST. LOUIS'

LOS ANGELES

7%

'5$

Toronto

Montreal

New York

STRAUSS BROS

INCORPORATED

Class

H An over 2-0080

Bell.Teletype NY 1-395

Members New York Security Dealer$ Ass'n

Bell & Co.
h.

Preferred

N. Y. 5

WILLIAM ST.,

COAST

-

v>--v.»y' v# v1

v<-

->v-

i.. v-.r

Syracuse Transit Corp., Common

7%

,

'

SportsProducts,vln^fCbmtrton

Broadway, New York 4

Mines

HART SMITH fc CO.
53

COAST-TO

our

Wesson, Inc„ Common.

Telephone Bond & Share

Sherritt Gordon Mines

a

debt to

the

owe

we

as

Paper Co

Minnesota & Ontario

To be sure, it

is sheer nonsense*

r

International Utilities

is that, while the Federal debt has
been increased $250 billions since

1929, all other debt is down only
$20 billions.; There is also a dis¬
position to argue that the size of
the debt makes no difference be¬
cause we owe it to ourselves. This

Rwy.
Lumber

Canadian Western

fact of the matter

declined, i The

$6&7%Pfl

Company Com. & Pfd.

Canadian Pacific

State,

the

because

Corp.

Anglo Huronian

the

about

worry

debt

Direct Private Wire Service

General Public Utilities Corp,, Common

50

III ES

Andian National

municipal and private debts have

whole

AD IAN

Royal Bank of Canada

delay,

true

The

Bank of Montreal

large a rise in the national
debt and it has been said that

is

some¬

Canadian Bk. of Commerce

minimize; the importance

Federal

We

868),;

on page

SECU

so

we

of

community.-

in the

-(Continued

It is fashionable in some quar¬
of

whole.

as a

Teck Hughes

Crescent Public Service Co., Common

W,

which

Social Security System, which is
set up on an actuarial basis such
as to bring it within a few yea¥s
to a point where Social Security
tax receipts will not provide ade¬
quate funds to meet benefit dis¬

our

lions,

~

assumed

the liability side

on

billions. At such a
national debt is high by
whatever statistical standards one

level

Texas, Feb. 11, 1946.

•

has

commitments

hot listed

debt has increased about $225 bil¬

Standard Aircraft

else

one

outstanding will
the stratospheric fig-,

*An address by* Mr. Shields be¬
fore The Petroleum Club, Dallas,

Smith &

further
to

to

terms

debtor can sweat and

a

debt represents an asset

J946 the total of U. S. Govern¬

be

cannot

national debt

our

and

ters

solely in

squirm and get into all sorts of
difficulties in trying to pay off
his
obligation even though his

for
economic re¬
habilitation; and to make loans
through the Export-Import Bank.
These Obligations, some absolute
and
some
contingent,% run into
many tens of billions of dollars,
and they, together with the pres¬
ent size of the debt,' make it ob¬

ligatory. that our Government get
its fiscal 'house in order without

;

is, meaningless

debt

community,

know that

ment1 securities

"bold experiments" cf the past 15

prosperity

Debt Is Already Tod Large;?

ready too

mortgaged

it

the

Government

to

Our

of its balance/sheeti; There is the

that * budgetary
become imper¬

now

approximately

Government

eral

lation, by erecting grandiose cor¬
porations for doling out credit, by
forcing interest rates arbitrarily
low, by colossal investment in
public works, or by grants, doles
or subsidies.
We can be positive

that

a

only with our income and our
wealth, but with -the taxpaying
capacity of the people.
1 ;/ i But this not all, for the Fed¬

program

any

produce

ative for several

Shields

Murray

bank manipu¬

years

have
while.

not

perity; but it is Cleairly the indis¬

&

But
■

•'■

•

the

of

direct loans to foreign

extend

the mortgage is high as compared

to point out, the only economic
necessity if we iare to. have pros¬

incontrovert- f

been

has

future

eco¬

expansionary tendencies in¬
in the private enterprise
system or maintain a high level
of production once it is readied.
Bucget balancing is not, I hasten

provides^

that

to

we

equal to tne national wealth.

which activate

incentives

and

tional income

we

herent

past two dec¬

not have dutf

budgetary
balance
revitalize the basic
,

the

.

The experi¬
ence
of
the-

ades

denominator of these

common

without

ity that is the
•

ought to tell us that
had enough of that for

years

by economic sleight-of-hand.

; We should know, however, that

prosper¬

;•

is

Development,

Reconstruction and

A few years ago our Federal debt
schemes, which were sold to the
was
about half the national ■ in¬
people as panaceas for the eco¬
come and a fraction of the roughly
nomic/ills of the time, was spend¬
estimated national wealth, Today
ing. by the Government of ' more
it is close to- trod times the na¬
funds than it collected in taxes.

problem of fi¬

debt.

discuss
of the

it

the International Monetary Fund
and the
International Bank for

•

certainly with

as

obliga¬

contribution

initial

the

debt

additional capital

tions to provide
above

to

also the

are

J.

...

governments

realize how much^-

people

economic

our

bers;- There

'

which has
its mem¬

Insurance Corporation,

,

»

Cor¬

Insurance

Deposit

poration, which has insured over
$100 billions of
bank deposits;
and the Federal Savings and Loan

Reduction^As Indispensable to theExp ansion of Private Enterprise, and for the
Accumulation of Reserves of Sorrowing Power for Future Emergencies. Hold¬
ing That A Vigorous Retrenchment in Annual Expenditures Is "The Categorical
Imperative of Our Time,"! He; Demonstrates How They Can Be Reduced to
$15 Billion.
831
.

which

istration;

'

8

.

Vice-President and Economist, Bank of the Manhattan Co.

"

are

Bust

or

833

CHRONICLE

THE COMMERCIAL & FINANCIAL

163i f Number 4464

.

'•V"

'

r

,

■'.
; -.i
r*\ w-' ,'?-,y.A*.

u.

-<-

-r.

v-'

PETER MORGAN & CO.

W. J. Banigan & Co.

-*

FREDERIC M. HATCH S 00..

Esabirshed' 1904 *^

31 Nassau Street

Tel.- BA 7-5161

New York 5, N. Y.

'Tele.

NY 1-2078




:

oseph McManus & Co.

• ••

-iSLJ.-M

50

Broadway, N. Y. 4

Carlisle,

Pa.

^

HAnover 2-8380
.

Scranton, Pa.

?

?

.

.

.

-■

Incorporated

MEMBERS. H. Y.'SECURITY

63 Wall Street,

New York 5, N. Y.

'

DEALERS ASSOCIATION
,

,

,

'
,

York Curb Exchange

Members New

*

Belf Teletype NY 1-897

Stock

Chicago

V:'"'1';'

*. «

Exchange

/

New York

§*

39 Broadway

s

'Digby

^Teletype NY 1-1610

v

,

THE COMMERCIAL & FINANCIAL

Thursday, February 14, 1946

CHRONICLE

Ourlnt'l Policies
the
Republican Party

The Obligation

The Outlook foi Production

By ALF M. LANDON*

And Prices
By D. W.

Former Governor of Kansas

By

MICHENER*

Bank

Research, Chase National

Associate Director of

■

Was Most Pronounced in History. Holds IndiAre That Workers* Efficiency Has Declined and That Man¬

Decline in Output

Available for Production Is Only Moderately Above Prewar. of About 10% for Consumers

power

Foresees Price Rise in 1946

Era.

Upholds Government Regulation but not Operation of Economic Life.
Says Man Can Accomplish More by Cooperation Outside Government Than by Govern¬

Vicious Interference With Politics and

Goods, Due to Large Accumulation of Liquid Assets, a More Rapid
Turnover of These Assets, and Restricted Output of Goods. Holds
Inflation Can Be Avoided by Reduction of Bank Deposits, Reduc-

r;

ment Coercion

Bonds, Higher Taxes and
Paying Off Greater Proportion of Government Debt.
Six postwar months are already behind us.
However, it is still
Holdings of Government

tion in Banks'

difficult to get a clear view

justing

dustrial

our

is

has

ended

164,

obvious

o

s

pro¬

The year
index

at

according to present
level considerably be¬

Harbor attack.

Strikes during the

past month pulled the index down

t

still

sp ectacular
achievement
of the past

■>

low that at the time of the Pearl

that

t h e

estimates, a

Board

the

with

about

W.

per¬

near

future.
D.

was

the 150 level,
Now the question is what of the

i;

20
the

January

further.

haps

volume of in¬

dustrial

most

1945

nounced in our history.

duct ion
record - (see
Chart I) it is

years was

the

been

If
at

p r o

m

w'

went
the decline during

the war,

into

going

look

\

industrial production as we

industrial

our

-

,

keeping with the unprece¬
dented rise in physical volume of

the

to be like.
we

was

In

/

immediate fu¬
ture

1929. -

the boom of

peace t ime
conditions and

what

1937

during

output

higher than that achieved during

to

economy

of

Ninety

.

Do

we

have

-

"what

it

takes" to produce goods at a rate
comparable with the wartime peak
of industrial output or will we

Michener

pro¬

during the war.
The increase in the index of in¬
dustrial output from 1937 to. 1943,
as estimated by the Federal
Re¬
duction achieved

have

to

satisfied with

accom¬

of much less

magni¬

be

plishments
tude?"-'-.

'

■

Plant and Equipment

Board, was approximately
100%—and 1937, of course, was a
good year. In fact, the peak of in-

serve

In

attempting to answer this
question, I shall direct your at¬

it

men.

sought

p r

R

e

Lincoln,

met

issue

squarely, and
its
strength

Sold

—

this issue dominates and underlies

behalf
freedom

o

there

The

Party

died.

Today the great issue before the
American people
is free men
against the tide of Statism which
is sweeping three-quarters of the

Chicago and

74

Quoted

members flew York

Telephone: BOwling Green 9-7400"

Stock Exchanged

associate members N.Y.Curb Exchange
15 Broad Street, New

Trinity Place, New York 6, N. Y.

Abroad.

now

ballot box rather than elsewhere.
Both Parties. Have

telephone: HAnover 2-6388

of

Administration

Truman

Compromising at Our Expense and
Calls Upon Congress to

Define Our

Foreign Policy.
political

momentous

the

policies involved in
our foreign relations demand the
most thorough and searching de¬

and military

discussion

and

bate

American

people

the

that

so

know

may

exactly what they are doing and
why.
democracy
has survived
fostered a great, nation be¬
of the ability of the people

Our

and

cause

issues and dominate their

to grasp

solution.

talk

double

and

con¬

the ad¬
The American people do not
ministration has given the Ameri¬
have that opportunity offered to
can people, has left them in doubt *
them: by the political parties to¬ artd confusion.
This 'has had a
day. Both parties have straddled. disastrous effect both at home and
flicting

and

constructive

philos¬

ophy of government with the
principles which flow from it. And
that philosophy must reach far
deeper than the froth of slogans
or

i

platform

planks designed to

appease
every, pressure
group.
This fundamental philosophy can¬

Conservative, Liberal, or Progres¬
sive.
Lenin's
direction to
his
Communist supporters was every-

Teletype: NT 1-375

and

The

Straddled

not be defined, in the old terms of

York 5, N. Y.

Aif m. Landon

Bath

is, will the
Republican Party take this issue
or will it seek to straddle, as did
the Whigs 90 years ago?
Two-party government is essen¬
tial to the democratic process. But
the high purpose of two-party
government is not to gain public
office. The purpose is to give the
people an • opportunity to deter¬
mine fundamental issues at the

mental

Continental

1914

but again

What
the
Republican
Party
needs, what the nation needs from
the Republican Party is a funda¬

♦

Inc.

BURNHAM& COMPANY
ESTABLISHED

other issues,

The question

dignity for all
men.

are

all others.

f

and

Whig

in

Govern-

am¬

un¬

and

Southern Airlines,

HoiiiteSltait

further

compromising
struggle
in

brave

■Airlines, Inc.
—

a

by continued excessive taxation
and by creeping inflation.
Once more, we face a crisis in
free men. "As: in Lincoln's time

vitality
from its

,

Bought

Our

Urges
Keeping Great
Britain Strong, in Order to Attain
biguity, the "Welfare: State." This
growth of Statism has been nour¬ World; Equilibrium, and Changing
ished by the confusion- of a; great Our "Morgentbau" Policy Toward
war.
And it can grow stilf more
Germany. Accuses Secretary Byrnes
transformed - into

Abraham

grew

Confidence

worse,

Fascism, Socialism or the
American mixture of
Fascism
and
Socialism
called
"Managed Economy" now being

*

Nickel Offsets, Ltd.

Principles in Present Crisis.

munism,

Party, under

and

^uss^a and.

"disguised

tention first to the extent of the
Address by Mr. 'Hoover before
,*An address by Mr. Michener changes in plant and equipment National Republican Club Lincoln
before
the % Federal
Wholesale during the war.
Statistics now Dinner, New.York City,, Feb. 12,
Druggists' Association, New York | ihade? available f by Government 1946.
i
(Continued on page 862)
City, Feb. 6, 1946.
'f

Getchell Mine, Inc.

■L

world—whether it be called Com-*

e s,

courses

publican

the

Conference by

people was

lyoung

The

Princi-

ij^l. San Francisco

H
^

It Stimulate

years ago the great issue before the American
The Whig Party refused to accept that issue.
Even

evasions.

and

>

com-

omis

•niddle

Breaking Away f|
From

Holds.Freedom Throughout World Has

Shrunk and Calls for Steadfastness to

free

in

far

/Proper Initiative in Men?''

have had thus

of the success which we

and Best Test of Government Is "Does

Candidate

eign Policy as, Inconsistent, Floun¬
dering and Deceptive. Says We Are

Both

That

Presidential

Criticizes the Administration's For*

Hoover Contends That the

Year Will Be Considerably

cations

of the United States

Political Parties "Have Straddled," Mr.
Republican Party Needs a Fundamental
/and, Constructive v Philosophy of v Government Far Deeper IJan
Platforms Designed to Appease Every. Pressure GroupUrges
Fidelity to the Constitution ,With Its Bill of Unalienable Rights.
[ Attacks Some CIO. Unions as Demanding Special Privileges and
Asserting

Analyst Forecasts That Production Volume in Current Below the Wartime Peak, and That;

Research

Former

HERBERT HOOVER*

Former President

.

which

deceit

"Bread of

world.

the

in

actions

sweet to man, but afterwards*
his mouth shall
be filled with
is

gravel."
In the British financial

for the first time

a

proposal,

fundamental

of international policy
placed squarely before the en¬
Congress for discussion and

question
is

tire

debate.
I

the Congress not to de¬
British deal on snapi

urge

cide

the

judgment—the way the; adminis-;
tration has been making its deci-

(Continued on page 871)

*

An address by Mr. Landon be¬
the
Women's
Republican

fore

BANKS
We

are

Philippine Gold. Shares

DEALERS

—

prepared to bid firm

i

(Continued

Carbon Monoxide

Masbate Consolidated

BLOCKS of SECURITIES
Prompt Action—Offerings Wanted

GLOBE AIRCRAFT

Mindanao Mother Lode

Claybaugh 6k Co.

;

*

& Common

Preferred

AETNA STANDARD

ENGINEERING

'

Tele. NY 1-2178

79 Wall St, New York 5, N. Y.

72 WALL ST., NEW YORK 5, N. Y.
Harrisburg

-

Pittsburgh

-

Syracuse

-

^CONSOLIDATED

F. BLEIBTREU & Co., Inc.

Members Philadelphia.Stock Exchange "

WHITEHALL 3-0557

873)

American insulator

Balatoc

Analysis upon request

Blair F.

on page

Eliminator

San Mauricio

Benguet

January 28,

1946.

United Paracale.

on

Kansas City,

Club,

32 Broadway,

Telephone HAnover 2^8681

Miami Beach

INDUSTRIES

PETER BARKEN

Units

New York 4, N. Y.

Tel. WHitehall 4-6430

Tele. NY 1-2500

*GREAT AMER. INDUSTRIES
'

'■

•

KOLD-HOLD MANUFACTURING COMPANY
Manufacturer of .Electric Refrigeration Equipment
A low

Billings & Spencer

Getchell Mines

Citizens Utilities

priced speculation

-

["♦SILVER

ACTIVE MARKETS:

Bought—Sold—Quoted
"7.i

..

and

Common

■

CREEK PRECISION

*

1

Circular

on

Request ■.-»

PROSPECTUS ON REQUEST

Great American Industries

FRANKLIN

COUNTY COAL

COMMON
CIRCULAR

ON

J

*

r

'

F. H. HOLLER &CO., Inc.
Members N. Y. Security Dealers Ass'n
Ill

Utility Co.

Kingan Co.

REQUEST

**Prospectus>

United Public

■

Common

&

Pfd.

.

>•

J. F.

Bought—Sold—Quoted

-v ■'

Soya Corp. of America

New

HARRISON & SCHULTZ

SIEGEL & CO.




.

Request

NY 1-1026

39 Broadway, N.Y. 6

DIgby 4-2370

Teletype NY 1-1942

r

64 Wall

St., New York 5

Phone HAnover 2-7872

£

Tele. NY 1-621

Reilly & Co., inc.
,Members

•

York Security Dealers Assn.

40 Exch. PL, New York

5, N. Y.

..HAnover 2-4785

System Teletype, NY 1-2733.-34-35

Bell

BROADWAY, NEW YORK 6, N. Y.

BArclay 7-0570

on

Common"

3,..

■

...

v

Private. Wirea to* J >v;'

Boston, Chicago & Los Angeles

(Volume 163

Number [4464;

THE COMMERCIAL & FINANCIAL CHRONICLE

(Special

has

U. S. Senator from Ohio

Full Employment Bill

Sons,

as

"a Spending Measure"; and Contends

That It, Like Similar Prewar "New Deal"
Measures, Will Not Solve Problem of
Problem Is Not to Create but to Maintain a

409

Board, particularly when it
explained to me that you

your
was

did
mand

dress

on

ing.

much thought or in¬

trospection.

It

risen

has

introspection, whether

of

out

hous¬

in the armed forces.

% New

can

to debate
eral

our people and the
initiative generated
But today we have

of planning

an, era

Street.

the U. S. Army.

'

make them

and

We

and

want

to

tinker with

(Continued

;

,

go around faster.

on

page

the

public utility

ma-

857)

preferred stocks

of

Business and Politics

sev¬

.your

estate

organi¬

Mr. Hanes Contends That Through Pressure Group

pro¬

of

gram

rea¬

size

sonable
was

neces¬

a

of
attempt to
part

sary

any

Robert' A.

whole

open

The

on

;

situation,
I ant
of real estate
minds are at least

the subject and talk to

them on some other subject.
A

subject of

and

You will remember a few years

back

we

program

had

those

who, for

one

reason

319

bond
' i

are

shown. Included

are re-

p pertinent capitalization, property and earnings figures

popular slogan, "More Business in Government,
less Government-in Business."
The order of to¬

and ratios.

to be just the opposite. Whether we
like it or not, business is in Politics—-and we are
there to stay.
seems

,

the end of

demption features, original, offering data, legality and

'•
''
'
will be sent to Security Dealers and

;

'

A copy

must be
Labor has announced its intention of captur¬
part of any general plan to im¬
ing the local and state governments, as well as
prove social conditions, eliminate
the Congress of the United States and the Federal
hardship and poverty for the low¬
Government. The question is, therefore, "Will the
est income
groups
and restore
United States be run for the benefit of a few •
something like equality of oppor¬
John W. Hanes
privileged groups, or will we accept again the
tunity to all the children who nfay
basic philosophy of Thomas Jefferson?"
foe born into America as we find
it today.
We have in this coun
*An address by Mr. Hanes before the Pittsburgh Advertising
try the highest average standard
Club Jan. 22, 1946..
■ 5 '
of living in the world. • We are
(Continued on page 8^2)
^interested in maintaining if and
in raising by Government aid and
floors, if necessary, the standards
housing

lists

preferred stock issues of Electric, Gas and Tele¬

supervising such securities

a

day

1934 to

1943,

Many factors considered indispensable, in valuing and

discussion here today is

my

This booklet, the first since

phone Companies.

,

a group

whose

men

Taft

housing

glad to find

1945.

"Business and Politics."

with the

deal

Containing all major new issues fr6m

Tactics, Propaganda

Advertisement, the Leftist Organizations, Particularly ihe
CIO, Have Succeeded in Dominating the Adminis¬
tration's Policies and Have Been Undermining Pri¬
vate Enterprise and Creating a Privileged Class.
Cites Reports of CIO as Evidence That They Favor
Administration's Bill in Congress,'

rent

-

housing

<

and Political

subsidized

low

Former Under-Secretary of the Treasury

-

zations,
de¬
fending my
position
that
a

Comparative Statistical Data

By JOHN W. HANES*

friends in real

.

pany,

Slayton &

During

holidays I had

<

Glenn B.
Com¬
Inc.,
Ill
North Fourth
He was previously with
with

Adams is

1946 Edition of

the wheels go round and how we

reached

Chronicle)

—

like it

we

the Christmas

of

Street,

Eighth

We want to find out how

not.

or

the freedom of
energy

ad¬

an

&

MO.

LOUIS,

ST.

public utility bonds

without very

and
by freedom.

de¬

not

Soffer

Edwards

G.

North

after serving

Unemployment. Says
High Level of Employment, and That It Can Be Solved
Only by Sound Government Policy in Finances and Economic Measures.: Holds Administration Has
Adopted an Inflationary Wage Policy, Combined With Inflationary Spending,, and Criticizes the Heavy
Government Lending as Having the Same Dangerous Inflationary: Effects as
Spending. Urges Bal¬
ancing of Budget, High Production, and a Check on Spending and Lending as Insurance of Perma¬
nent High-Level
Employment.
It was a great pleasure to me
accept the courteous invitation of

A.

rejoined

& Co.

(Special to The Financial

Chronicle)

to The Financial

ST. LOUIS, MO.—Ben B.

By HON. ROBERT A. TAFT*

Senator Taft Attacks the President's

Joins Slay ton

Rejoins A. G. Edwards Co.

uHigh-Level,r Employment—Now and Forever

Institutional Investors

The

,

on

request.

•

FIRST BOSTO

corp6ration

or

another, fall behind the proces*
sion in a competitive economy^
But such a social welfare pro-*
gram is only made possible bV
the prosperity of the* rest of the
people, by the sound and con*
tinuous
economic
progress
in
Which our people have set an
exampleno the world. We have
accomplished, our amazing result

a

buffalo

cleveland
rutland

providence

DIRECT PRIVATE OPEN-END WIRE
to our

*An address by Senator Taft at

;»

.

tr Ir*'s.

11

231 S6. La SalLe St.

ji'tloo broadway

,,.v

Announcing the installation of

Chicago

New York

Boston
One Federal Street

philadelphia

hartford

san' francisco

?t-T,

.-*

A'h

.^springfield

jgf ; n

Boston office

Telephone

the Annual Banquet of the ? Real
Estate Board of New York, Feb

We

CANAL-6-8100

2,1946.

pleased to

are

that

announce

MAJOR A. A. SIKORA
/

duPONT, HOMSEY CO.

CommonPreferred

has rejoined the staff of our

31 Milk Street, Boston 9

PATHE INDUSTRIES

NEW YORK OFFICE

SELECT THEATRES

Telephone

BROCKWAY MOTORS

i,

'

Hancock-8200

>Teletypei,;.
S BS.-424 *

»

'If

,

'

.

'

.

CRESCENT PUBLIC SERVICE

Wm. J. Mericka ir
INCORPORATED

Members Cleveland Stock

P. J. Steindler & Co.

29 Broadway, New

; •'

Exchange

York 6, N. Y.

Members New York Security Dealers Assn.

IX

We wish to

Broadway, New York 4

Digby 4-0330

NY

announce

Union Commerce Building, Cleveland 14, Ohio
.-'Eii.fjf;'; 4<
'frf. ■
.. •
N'f
u.'.-

that the firm of

1-1340

ELDER & CO.
which was inactive for the duration, has

resumed

operation of its business, and that the firm
has been

name

We

are

pleased to announce that

changed to

V-v",

•

MR. HENRY GULLY

ELDER, WHEELER & co.

HODSON& COMPANY

Inc.

-

'

' MEMBERS

,

f

New York Stock Exchange
New York Cotton Exchange

New

61 BROADWAY
New York 6, N. Y.

165

Broadway, New York




WHitehall 3-4000

New York Curb Exchange (Assoc.)
,
Chicago Board of Trade
,
\
York Produce Exchange

is

now

associated with

us as

Economist,

.

735

BROAD STREET

Edward P. Field «
Members New

Chattanooga, Tenn.
-

6-5155

37 Wall

£tree»

Co

York Stock Exchange

New York 5

THE COMMERCIAL-<&- FINANCIAL'
CHRONICLE

836

Slate Presented to

Eddy With Merrill Lynch ]
Merrill
&

The

Street,- New

Fine

Beane,.' 70

York

Cashiers

Fenner

Pierce,

Lynch,

The

City, members of the New

Charles F. Eddy to

their staff. "

committee

nominating

of

Cashiers- Association of

Wall

rectors for 1946:

Joseph F. Hughes,
President;
Joseph A. Costa, 1st Vice Presi¬
dent;.. Daniel Breitbart, 2nd Vice
President; Joseph T. Clark, Secre¬

BALTIMORE

tary^; Robert. j," Humphrey, Jr.,

Bayway Terminal

Treasurer, and, Marvin W. Wald-

Davis Coal & Coke

Maurer,

i]

Drug

Ambrose

J.

Verlin,

;';;r

William S. Vanek, M. Leslie Den¬

Noxzerna Chemical

ning, and Thomas B. MacDonald

.

Common-

.

■

directors.

as

The annual dinner of the Asso¬

STEIN BROS. & BOYCE

ciation will be held

Members

the Hotel Henry Hudson.

York

New

Baltimore

&

Stock

Feb. 21 at

on

S.

Teletype BA 898

York; Telephone

v ■'

.

Rector 2-3337

common

share,
Corp.

82,000

stock,

of

du Pont, Homsey Co., 31 Milk St.,

lation
end

of

direct

a

wire

private

New

to

open-

York—Canal

6-8100,

Dwight Manufacturing Company

per

Precision

The Utilities—Pro and Con

Feb. 8 at $3.25

by J. F. Reilly & Co.,

of

the company and the
proceeds
will be added to
working capital.

Business Man's Bookshelf
This Is The Road To Stock Mar¬
ket

Success—George Seamans—a

new edition revised and rewritten
to take into full account the
present

position

right

the

to

up

time of going to press—Seamans-

111.—$3.08,

with

At

■

Inc., New York. Of the shares of¬
fered 72,000 are for the "account

market

a

recent luncheon forum of the New York

Society of Security
Analysts there was a general discussion regarding the current market
outlook for public utility stocks.
Among the favorable points dis¬
cussed were the following (with some added
material):

■fl/ (I) Utility stocks are not selling at unreasonable yields as com¬
pared with1 industrial issues (they' currently average
about>A%%:
compared with 3V2% tor good in-<3>
—
dustrials).
One analyst thought counts,
and - plant
accounts
of
that they might in future be com¬ many
companies have been writ¬
pared to "guaranteed rails" be¬ ten down sharply, while others are
cause
of
their
long
dividend amortizing plant write-offs. Such
records, and the fact that they are amortizations if treated as an ex¬
"guaranteed" a fair return on in¬ pense may be considered "hidden
——

This

vestment. ;

point of view earnings."
,
have been con¬
(8) Depreciation charges have
sidered extreme, by !the majority; "been
liberal, in recent years and
would

Automatics, Inc.

however.

.

.

(3) There will be

:•?'* ,y VA- >,i'r. _''\'s v ?"/.

P

''

"

United

Elastic*

Iowa Power .&
'•-%' '"

'<

Eastern Corporation

Corporation

United Light

Waltham Watch Common

Rath
n;:-.

take
■

Memos on Bequest

Packing Co.

EQUITABLE

Pont, Homsey Co.
31

;•*.

MILK

BOSTON

■

BUILDING

MOINES

Phone 4-7159

9,

MASS.

York, Philadelphia and
Angeles Stock Exchanges :
?

Bell Tele. DM 184

New York

Los Angeles

Pittsburgh, Pa.

Hagerstown, Md.

N. Y. Telephone—-WHitehall 3-7253
Private

/t..

*r

DETROIT

Wire System between

Philadelphia, New York and Los Angeles

HANcock 8200Teletype BS 424
N. Y, Telephone CAnal

6-8100

BUILDING

V

AHEAD!

T

k

3

;

-

Bonds

6 % due 1966

.

available

for

V

>

";b- -v*

'■

furnished

Grinnell

v'V!:?i?.

request

on

& Dolphyn

9

Members Detroit Stock Exchange

Buhl Bldg., Detroit 26

Cadillac 5752

Tele. DE 5071

-

in these

Michigan Markets

92H

•

.

bonds

94K-

-

Memorandum

on

,jj

-—
>-T!

Accurate
I'

\

75

■

Tel.

FEDERAL

B3STON

■■■':'

'

Liberiy 6190
Private

New

..

MASS,'

?

Members Detroit

/ '

Tele. BS 596

..

York

Rector

t

Telephone

2-5035

.

•

.v:;;

white,, noble & co.
"v~*

-

*

•

'

.

ExchangeIf?

GRAND RAPIDS 2
MICH. TRUST BLDG.

Phone 94336

.

Portland, Me., Enterprise 7018 " ^

Stock

Teletype GR

Warner Co.

We

*

"fair

be

interest

rates

6%, but

at

are

return"

of

rate

around

much

now

lower,

levels and

a huge amount of bonds',
preferred stock refunding has;('
been accomplished, with more in.
prospect.
Hence State Commis¬
sions may revise downward the

and

"fair

of

rate

return."

Thus

the

utilities

might lose a substantial
part of the refunding benefits.
;
(4) Labor and fuel costs will
doubtless show
■'!,

rising trend in

a

(Continued

page

on

:/

843)

*r\

v

maintain

•'

many

< 1

*

•

t

•

f

*'

x

'

;

•

* >r.

'

'

"X

'■

active market in the stocks of

an

public utility companies and through

the facilities of

in

trade

our

direct private wire

especially equipped to

system are
-

those

markets where

N

„

<

common

various

/

OFFICE

Phone Rittenhouse 3717 '

are

located.

Byllesby & Company

|-PHILADELPHIA

offices

Paine, Webber, Jackson & Curtis

Tele. PH 73

ESTABLISHED

1879

ST. LOUIS

American Air Filter

Girdler Corporation ~

Capacity—900,000 barrels annually.
Book value—around $18.

Good

earnings-

all

through

'

Merchants Distilling Co.

war

-

Jrom

tax

reduction.

U«-egon's
huge
ready to start.
Market

highway

Winn & Lovett

12x/t

t

(

V

.

Tel. HUB

1990

9,

509 OLIVE STReCT

Teletype BS




\••'

.

Of!v

North West Utilities preferred

,

j..• /"X'

St. Louis 1. Mo®

Incorporated

-

69

%
England Public Service preferreds

'

1st

SQUARE
MASS.

New

common

f Portland Electric Power prior pfd.

Grocery

Z»1 BANKERS BOND ££i

OFFICE

BOSTON

Co,

INVESTMENT .SECURITIES

'■

about

&

;
^

lerner & co.
POST

Stix

program

*/--• ;;V._ Circular available

10

Crescent Public Service

Louisville Gas Pref.

Company would benefit substantial¬
ly

"

*

We

American Turf Ass'n

period.
*

The
to

Suggest-

Common Class "A"
>

1945-46

reminiscent

'■

Oregon Portland Cement Co.
*

somewhat

PUBLIC UTILITY STOCKS

«

Stock Exchange Bldg, Phila. 2
184

used

proportion.

common

kloor, Kentucky Home Life Bldg.
LOUISVILLE 2, KENTUCKY

Long Distance 238-9

Bell Tele. LS 18f

Members St.

Louis Stock
Exchange

Gilbert J. Posti.ey & Co.
29

BROADWAY, NEW YORK 6,
Direct

Wire

on

fair

on

-

been

(3)

v;

although

our

H. M.

rates

cases present prices of hold¬
ing company securities reflect a
"gamble" that pending recapital¬
ization plans will be amended by
the SEC or the courts, to permit
retirements of senior securities by
cash payment.

12/months

gain of 3.6%

of

return

Inquiries Invited

Sterling Motor Truck

LOUISVILLE
?

a

"fair

other

decline of about the same

Central Steel & Wire

is

STREET

10,

a

Vinco Corp.

Dayton Haigney & Co.
;

was

of

1929,
and
some- low-priced
holding company stocks are sell¬
ing at prices which apparently
can't be justified statistically.
In

.

the

much

utilities 'will

of

(7) A great deal of house-clean¬
ing has occurred in the utility ac*

Empire Stec! Corp. com/:
Vp1*'?

'

For

savings

gained

determination

basis

have

..

7-1202

Philadelphia Co.

Inquiries Invited

request

'..

;

26).

;

Botany Worsted Mills pfd. :$jA.

L

Dependable

Texas

liberal rate of feturn;

.

yet
the

and

(2) Utility markets in

;
(5) Some of; the utilities: will
enjoy very substantial earnings
gains this year due to tax savings

showed

PH 30

Private Phone to N. Y. C.

Dealer

'

en¬

base'f

for the month of November there

GRAND RAPIDS

trading market

a

c

St., Philadelphia 3

Pennypacker 8200

Full 6% Earned and Paid 1944
We maintain

•

boenning & co.
1606 Walnut

COrtlandt

about 5y2%

as

Many Commissions may "go slow"
in ordering fate cuts because they
realize that costs are increasing,;;

Jan.

interest

usual

ended Nov. 30th net income of all
Class A and B electric utilities

Yield at current market
-

*

Mercier, McDowell

ending September 30, 1945
pyar 4 Times Interest Requirements

,

Corp.

Common Stock

months

a

of

rate

as a

Other states such

the

fight any "automatic"
cuts, which would depart from the

value."

"New Deal". methods

from the
residential

doubtless

old-fashioned view of rate

still allow

not

headway

the

etc.

to

consumers

has

move

(6) Despite loss of munitions
business, strikes, etc., total sales
of electric
current are running
only about 12% under 1945, and
the Rocky Mountain area is about
3% over last year '(week:ended

Common Stock

;

'

Outstanding $539,950.

Earnings

,i

Reports

an

profits taxes).

Bag & Paper Co.
-

Manufacturing Corp.

New England Lime Co.

,

Southern Advance

Sheller
!1

stimulate

come

Electromaster, Inc.

gf ]

will

away

give

which the utilities may obtain by
new tax
law.. > However, the

(approximately 5% of federal in¬
taxes and 55% of excess

-

.

this

and

other

the

appliances.

forcing original cost

1529 Walnut Street, Philadelphia 2

IOWA

STREET
9,

and

take

to

utilities

regulation ; and have not adopted

-

BUCKLEY BROTHERS

*•'

Lo$
DES

of

try

may

cur¬

electric' appliances

the

\ 1

Members New

du

use

as

(1) A number of States, notably
Indiana, have indicated that they

(4) Some of the State Commis¬
sions, notably Pennsylvania, still

Gisholt Machine

& Rys.

.Common

.

Midland Utilities Co.

''

Preferred®

■

reduced

are

the

are

follows:

freely available and the build*
ing boom gets under way; If rates

Light Co.

Preferred®

of residential

use

as soon as

Some unfavorable factors

>

are

..

I

rent

PHILADELPHIA

re¬

straightline
deprecia¬
tion,"current : charges may be
reduced, which would improve
stated earnings.

substantial

a

been

When

"accrued

efficient.

111

I

-

have

become equal to estimated

serves

.

INCORPORATED

Parker Appliances

depreciation reserves
rapidly
increasing.

(2) The electric and gas com¬
panies have been "plowing back"
earnings into improvements dur-r
Now With G. H; Walker
ing the war, and electric capacity
; (Special to The Financial
ChronicLS)
has been increased about 30 %.
ST. LOUIS, MO.—Edmunds G.
Companies like Public Service of
Whitehead has become "associated New, Jersey have very
heavy
with G. II. Walker & Co., 503 Lo¬ buildiiig budgets for 1946-47. New
equipment will, of course, be more
cust Street, after
serving in the

WHEELOCK & CUMMINS

Naumkeag Steam Cotton

,

probably

increase in

Johnson

Utility Securities

of

cents

Creek

offered

U. S. Navy,

DES MOINES

Globe Steel Tube

shares

40

par

Silver

was

share

per

of

within fifteen days.

Boston* Mass., announce the instal¬

Assoc;;

issue

privilege of returning for refund

du Pont Homsey
Wire to New York

BOSTON

Berkshire Fine Spinning

.An

Blake, Inc., 841 West Washington

CALVERT ST., BALTIMORE 2

;vBell
New

Public

Precision Common

Blvd., Chicago 7,

Exchanges and other leading exchanges
6

Offer Silver Creek

billig, F. W. Q. Birtwell, Godfrey
H.

Emerson

•

Street, Inc., has presented the fol¬
lowing slate for officers and di¬

added

York Stock Exchange, have

;

•

Association

Thursday, February 14, 1946

to

Chicago

N. Y,

•Vi.

i j

•

;

Volume

163

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4464

low

recommended

costs, and of¬
maintaining
costs, to balance low prices.
The
only suggestion made, has
been that of holding down prices
fered any solution for

low

and

reducing unit costs -with
of

Much

of

volume

creased

in¬

production.

production is technical
definitely lim¬

and that volume is

ited by the tools to work with and
the
skill
and
capacity
of
the
workers. Moreover, in those few

where

lines

production

could

be

greatly increased with little addi¬
tion to the supply of tools a id
skills, - such as agriculture,
the
long term supply promises to be
entirely too large without any infarmers

and

crease

subsidy, to justify their present

a

costs.

Inflation

be stopped b.y end¬

can

ing deficit finance, reducing Gov¬

the min-

ernment expenditures to

(Continued on page 864)

CORPORATION

SCHENLEY DISTILLERS

NOTE—From time to time, in this space,
there will

which

appear an advertisement
hope will be of interest to our

fellow

A mericans. Th is is number 114 of a

series.

we

•

SCHENLEY DISTILLERS CORP.

•

Listening In

;

.

At

we were

middle aged gentlemen.

two

Ono

English.

unmistakably,

was,

for

neighboring the one at
dining, there were

table

a

which

was

:Xi.,

By MARK MERIT

•

He

unrestrained in his enthusiasm

things American. He was enjoy¬

ing his cocktail, sipping it slowly.
"How very

are",

cans

you Ameri¬
could not help but
repeatedly. He un¬

fortunate
we

hear him say

questionably meant it, boo.
!

Yes,

ever so

£

fortunate people, in

we are a

many ways.

Enjoying good

food and cheering drink in pleasant

surroundings is merely

? !

There's

Nothing

rather

■

Y

*

what

—

\

of alcoholic content.

with

ALABAMA

proof figure

Divide by two the
on

Here's

•All AMY

our

idea of

both—and whatever is to your
ours.

We'll make every

the securities you

•

.

.

bottled

/.

,

.

,

proof, which

86°

at

percent of alcohol by
volume ; The finest Scotch blended
43

means

advantage, is also to

the

whiskies—of which
doubt

no

man

effort to provide you with

need, and give, every other

-

v

Most American blended whiskies

are

■

should be profitable to

cooperation between dealers

WWW'

:

good business: We realize that
:

•MOULTRIE

•

VA100STA •

the bottle, and you
of the

know the alcohol percentage

us.

whiskey,

1

bottle of

a

50 percent alcohol

means

by volume.

Definite, practical co

dealers;

offer

we

operation with dealers is "firm"

.HARiESTON.

IAGRAHGt

impression

proof means 100 percent,

whiskey

JMNlStlD#

common error

the

Actually, 100° proof on

S»0W».

mtNIRCHIM

under

in terms

"Subject" About

HUNISKIUI

OtCMUR

a

was

that 100°

•cicenvuu

Wet

our

gentleman from England, how¬

ever/made
—he

CHATTANOOGA

of

"; ■ /

*

Talking about American whiskey,

the

»

one

happy privileges.

many

was

English¬

thinking fa¬

miliarly—are bottled at almost the

assist¬

proof-^-86.8? proof, tq be
equally fine and distinc¬

same

exact. The

BANKERS

INVESTMENT
>V- 2?

'N;

Lt

'•

•

-

J

.

r

' v ,'^

,

' y

4

-

i

;'r"vV%-

When

S
i

Private Wires

•

.

s.V;*'

•

// h

-I'';,'-'

•*»

* s'" t

a-'S

"V"' *

c; ¥£'

'£

■'$

V

you're pressed for time in closing a

trade,

solid statistical help, get in

our

mutual benefit;

•

tent, have become

years.

;

increasingly

It

appears

to be entirely

possible, that lower proof alcoholic
beverages in a large degree may

permanently replace the heavier
100* proof whiskies in public pref¬
erence, as is the case in many

Phone LD-159
"A-iFp Iy

'.'*vV

whiskies,

blended

American

similarly lighter-in-alcoholic-con-

popular, and the trend has grown
materially during the past few

COMMODITIES.

Home Office: Atlanta

:*;I. S'-.-ri•.-y*<:Kfr-c.. •

'•

touch with us—-to

INVESTMENT SECURITIES
BROKERS OF BONDS, STOCKS,

t

when you can use

UNDERWRITERS AND DISTRIBUTORS OF

:

tive

^
;

or

!
i''

possible.

£

Memberi New York Stock Exchange and
Other Leading Exchanges

v!

l!

* ■(:

'

ance

lifaSZ—

countries.

'

,

-

f

'

| We are proud of our light, blended
American

IN
[]

whiskies.

TelephoneHAnover 2-1700

68-William*Street
NEW YORK 5

Marchant Calculating /^

•:/ Machine Co."-;'

r

>1

-

"

?

,!..

Teletype NY 1-993 V

201 Devonshire Street, BOSTON 10 ; -

;

Members New York Stock

G

Gerber Products Company

Exchange

American Export Lines. Inc.
GOVERNMENT,
PUBLIC

NEW

ZD

PINE

5

YORK

STOCK

NEW

STREET

NEW YORK

YORK

CURB

SAN




FRANCISCO

'*■ V''

EXCHANGE
EXCHANGE

STOCK

EXCHANGE

■

i

•C.-.'V-'-[■:

■'

MUNICIPAL,

UTILITY,

•AND

f"
\

BUILDING

1 SOO

RUSS

SAN

FRANCISCO

the

quite scarce in the market today;
some day, when there has been
and

opportunity to relieve
of more than three

the dislocations

years of war, they will be available
again in greater quantities r—for
those who prefer them.

RAILROAD.

INDUSTRIAL

BONDS

FREE

—

Send

a

mark merit of

^'Vv■:

for

but

time
^

G

'

*

□ ;• Hawaiiali Pineapple Co., Ltd.

MEMBERS

As

heavier, 100° proof types, they are

JHE FEBRUARY ISSUE:

4

INVESTMENT

STOCKS

postcard

or

letter to

schenley distillers

350 Fifth Ave., N. Y.I, N.Y.,
will receive a booklet contain¬
ing reprints of earlier articles on various
subjects in this series.
corp.,

and you

(

promised'

are

838

THE COMMERCIAL & FINANCIAL CHRONICLE/

of

type
Trading Markets

[

»

I1.".'

Chicago Brevities
'

'■

'

'•

'

•

..

'•

'

*

I I

V

'

•

-7.V 1

.

-

Negotiations between striking AFL and CIO unions and Chir
cago's big four meat packers are expected to resume upon announce¬
ment of a government wage-price policy, following the report of a
government fact-finding board, recommending a 16-cent an hour

Established

1922

k« '

,

Salle Street

120 South La

CHICAGO

of the increase themselves and for

including

is

effect.

CARTER H.CORBREY&CO.

}

—

than

fr

dollar,"

i Anticipating continued liquida¬

earlier

:

at

■

par

■

in

mortgage

lien

bonds

of

excluded- from: par-:

! acquired

indebtedness,; with interest

of lash Dec. 31, the
trustees contended, total mortgage

the

indebtedness

President Lines from the Dollar

of

Financial

and

have

Paul

become

Central

—

Chronicle)*,-'

William

B.

connected

Republic

T.

Isherwood
with

Company,

209

>

serv¬

(Special to Thk financiat Chronicle)
ILL. -L William' B.

j

,

CHICAGO,
Healy

is

with

now

Comstock

;

&

Co., 231 South La Salle Street. In
the ; past; he was 7 with Alfred ;?
O'Gara & Co.

The. line's property value for

qccrued/as

which

Dwyer

purposes of
reorganization was
less; than its $30,000,000 of mortf

inr-

The

CHIC AG A,;"-': ILL.

the

ticipation.

i}

R.

ing in the armed forces.

holders and unsecured^ creditors i

be

ILL.—Jerome
joined the staff

1

present company. Present stockiwould

;

South La Salle Street, after

cash

would be distributed to holders
of

7'/ (Special to

common

and -$3,500,000

shares

has

-

the plan, all the 500,000

gage

mission,

with

and

accrued

(Special
?

to

The

Financial

Passaneau is
&

Co.,

105

Chronicle)

ILL. -L Harold

CHICAGO,

with

I

J.

Smith, Barney

West

r

Adams

Street.;?
the past he was with Halsey^; »

In

Stuart &Co., Inc. for many years.
unpaid interest as of- that date
amounting7 to' $30,609,582. Under
they
i
(Special to The Financial Chron icle)
Supreme Court decisions
securities with the Commission § U. S.
IL
Norton
as collateral for debt.
Both De- ;• therefore, unsecured creditors and j CHICAGO,
stockholders, representing hold¬ Smith, Jr.-has joined the. staff of -7
ipartment of Justiee and Com¬
Bache & Co., 135* South La Salle? ;
ings with a nominal value of $28,mission
a ttorne ys
"claim
the
785,961, are excluded from par¬ Street, after serving- in the U. S.
;stock was turned, over to- the
Navy.
ticipating. in; the reorganization.
•Commission in default.; A deThe proposal calls for the new
cision in the case, now before

interests

in

1938, claiming* that»
merely deposited certain?

,

.

V;0

'

to

/

The Chicago Corp.

.

corpo¬

:

Bennett, Spanier & Co., Inc., 105
South La Salle Street, after serv¬
ing in the U. S. Army.
; 7 V

Judge

new

a

"V-; v

•

,

Chronicle)

(Special- to THg* Financial

Spanier,

Co.

t

the United States Maritime Com- $

year.

Utilities Corp.

■

\

Railroad

.

after serving
S, Marine Corps..
*

CHICAGO,

•v:7*-777?7v7v'7.

capitalization of 500,,

j® Under

v

Wagner, Chicago Cor¬
President, stated that

offer.\
The
Dollar. ' steamship

"

^

y:;//

Federal

share?; of, no

0j00

stock.

terests have brought suit against

Chicago

:

hearings of the.- fact-finding panel
predicted a 5 to 10% increase for
1946 in meat production in Fed¬
erally inspected plants over last
Consolidated Gas

ration with

poration's
"circumstances" of the Dollar apr
peal had prompted withdrawal of
A

larger: than normal spring
summer1 hog
run,
packer

a

spokesmen

\Vith

road

Igoe, providing for

Seas

Richard

the

and

the

of

Corporation,
which
Shipping Co. (Robbir»
Line), New York, made a joint bid
for
purchase
of
the
$7,500,000
American President Lines, with¬
drew,. its offer, it was 7 learned
early last, week.
<

dnd

Michigan 4181

7

the

the
industry's
on
which costs

of

pro¬

■

tion of the high cattle population

650 S. Spring St.

CG99

State 6502

which

cents

'

figured.

are

LOS ANGELES 14

135 LaSalle St.

0.5%

("sales

MARKET

DISTRIBUTION
,

over

absorb represented a little more

UNDERWRITERS

CHICAGO 3

five

the

•

'•••.

:v.

Financial

Building,

in the U.

(North Shore Line) have filed a
proposed plan for reorganization

duction of steel fence posts for tlje
farm.
"7

with

Graham

Chicago, North

Shore & Milwaukee

machinery,

Calumet, 111., steel plant for

of the

Trustees

Chicago

the'

packers would be called upon to

Pacific Coast

por--

SECONDARY

2%

by

that

•

••

the'total costs for

present
levels, the panel found, and said

Wholesale Distributors
Middle West

'•f'•%:'*

..v<

(Special- to-The

AURORA,
ILL. — William
H.
Flent^e, Jr. has joined the staff of
William II. Flentye & Co.,
Inc.,

fprmer General Motors official, in

charge of style and colors,

*} x"

,

r

Co.

•

The 16-cent wage boost would

industry

farm

Illinois: Personnels

'*

.

ojf sales; and. George W. Lawson,

If!

a/..,

increase

Association
of Securities Dealers

Member, National

at

be¬
.

executive, ? Vice-Presi-;
Joseph D. Burke, veteran
automobile man formerly associ¬
ated' with Chrysler, Hudson and
Packard, Vice-President in charge

present, also- expanding .its

price or
subsidy relief sufficient to cover
the cost of putting the other 11
cents of the wage increase into

Tele. CG 271

Tel. Randolph 6960

ucts,

the Government? to grant

3

sell

dent;

general wage increase.
Meantime, neither unions or management
would comment on findings of the panel.1
j The
recommendations,
which »
—-———
•
——
apply specifically to Armour & treble the factory's steel output
Co., Cudahy Packing Co., Swift & early in 1947.
v
Tne company, which manufac¬
Co., and Wilson &> Co., called for
the companies to absorb five cents tures a diversified line of prody

C. L. Schmidt & Co.

to

$1,0,00 and $1,300.
:
j Officers named by Mr. Tucker
are
Raymond
Rausch,
former
Ford

,

Kropp Forge

automobile

tween

.

Vf '

General Box

Thursday, February 14, 1946';

Packinghouse workers returned
work Jan. 26, following gov¬

ernment seizure of the meat

ing plants ten days after

The-Muter-Co. /

pack¬
walk-

a

•

•

Circular

on

'•

Request

Stockholders

;

Members Principal Stock Exchanges

?.7?;•:>./

Randolph 5686—CG 972

,

New

York Office

\

.

Court

of

Appeals

pected

■j

The

a

of

for

calls

proposal

creation

■

,

1 Wall St.

-

S.

; Washington
Is / expected'
mentarily.
Regardless
of

ST., CHICAGO 4

231 SO. LA SALLE

i

of. Borg-^Warner

U.

April 1.

HICKS 6-PRICE
Chicago Board of Trade

the

proposal to increase
the corporation's authorized cap¬
italization at a special: meeting

will vote on

i

the
of

shares

250,000

non-convertible $100 par cumu¬

\

lative preferred stock of which

200,000 shares would be offered

j to the public. Funds from the
[sale of the stock, totaling ap¬

go

to 7 the

| company;; to

Central Steel & Wire, Com.

,;

If

Globe Steel Tubes Co., Com.

|l

*WeIl*-Gardner & Co.,. Com.

|l*Woodall

J

be'used

1916

■■■■<""•'

Chicago Board of Trade

'5 "

1

Tel. Franklin 8622

the

road's

move

.

..

I CHICAGO, ILL.—Frank

in¬

mortgage
'

7 V

Brailsford

J. W.

Holloway With
H. Oliphani & Co.

Stone & Webster and Blodget'
Inc., securities firm, has changed

Jas

its

&

Co.,

208

He

was

formerly with

!

Already under construction is

First Securities Co.

I

which

I

Securities

Stone

Corp.

&

The

Webster

name

was

decided upon, Robert H. VanDeu-

209

President, stated, to 'more ac^
curately reflect the company's rer
sen,

lationship with Stone &

Inc.," of which it is

A

a

La

(Special to The Financial Chronicle)

Salle, Street.

Co.

from

1927

to

?

1942

—

Trust
the

was

increase

rolling: mill

new

five years as- investment analyst
*
*
i
in the; trust department.
His dis¬
huge Dodge
plants
tinguished war record* included
operated
during
the
war
by service as
counter
intelligence
Chrysler, will be taken over by
Officer with the Twelfth Air Fprce
Tucker v. (Corporation if
presenJ ih Africa and Italy and? he. was
negotiations, reported to be pro-, relieved from
active duty/ as e
'gressing, are consummated in the
Major in November, 1945.'
lease, if not sale, of the property

a

to the

new

■;v-

corporation.

productiqn
year.

will

which

The; eorppratipn' wa^ formed by
Preston

Tucker, President, Ypsi-

Tanti Machind and Tool

McKinnon.
?7

•

(Special

to "The Financial

lanti;, Mich., to manufacture

a new

TRADING MARKETS ^

Chicago North Shore &

t;

i

^Automatic Canteen Common

Milwaukee R. R.

*ShelImar Products Common
■V

Corporation

i

•

...

-

.

t

.?• •

r..,

oalle

otreec,

army,

t He

;:

Chicago Stock Exchange
CHICAGO, ILL.

—

President of Sidlo, Simons,

mpus,

& Co.,

A.

of Denver, Cplo-

Kroeck, both of - Chicago,

elected

to

membership

were

the

in

the

GovernorSj

it

is

<

.

With the election of Mr. Simons

■■■ -.

/■€,

"Prospectus Available-

>v

Details

&.

■

to

Earnings available

;

membership,
&

Roberts

1501

Brailsford & Co.

Members of Chicago Stock Exchange

Teletype CG 955

209 S. La Salle Street
Tel. Dearborn 9200

Chicago 4

♦

tion

of

sixth

Simons,

Sidlo,

Co.,

twenty-ninth;

208 S. La Salle Street

the

State

9868

CG

95

corpora?-

and

Exchange

the

in

the

dealer

investment

City of Denver, ; Colorado
come

the

becomes

member

CHICAGO 4

Tele. CG 146

Tel.

(Special? to The Financial Chronicle)

CHICAGO,
has

Daniel: F.

of

/

o

••

•;

A

208

CHICAGO
Telephone

4,

ST.

ILLII

i

'

'

•

■

"

•

•

•_

Wire

to

New

Members

New

Other




York

-v.••"*•'

•

•

Recent

Analyses

•.

Merchants

Building.
Mk
7

'

ROCKFORD,

*
;

^

,

7 •

now

ILL.

—

.

.

to be¬

on

ErWirt

with King & Com-!

'

Mississippi Glass Co.

Company
Stock

Exchange

La

Salle

Street

•

Copies

on

:

CG" 252

request

CASWELL1

Stock

Conrads & Company.

W. M. Rosenbaum Return^?
W.

M.

Rosenbaum & Co., 285> y
Avenue, New York City,,??

Madison
members

change,

York? Stock

New

William

M.

Ex-'?

the? return of

announces

Rosenbaum from

the

Common

V

-

FOUNDED 1913

THOMSON:&

| MCKINNON

Stock

SECURITIES

•

COMMODITIES

Tele. CG

1122

Member

New

York

Stock

and other Principal

208

3, ILL.

Phone Central 5690

■
?

231 So. La Salle St.

FAROLL & COMPANY

Chicago 4
•

& CO.

So. La

Andover

4430

7"

Exchange

>

Branches in

'

35

Cities.'

•

Exchanges
Members New York Stock Exchange

Salle St.

CHICAGO
Phone

—

r,

4
Tele.

CG

156

,

*

military service to active partici-77
pation in the firm.

•'•I'.v-7V

Standard Silica Corp.

120 South La Salle Street

CHICAGO

CHICAGO 4
State 2400

:i 7

[

of Rockford^ 321 West Stated j
Street
He was 7 formerly with ;

Request-

:

:x;'f

? • •

?

.

pany

Distilling Corp.

Common

,.['•' 'v'v ::

Principal Exchanges

South

York

i

C04

member of the Exchange.

a

Common

•

Sincere and
231

System -CCr 637

iV?

"

Bought—-Sold-—Quoted

and

Randolph

Direct Private
Bell

SA^LE

LA

the?

&

M-3-

study of Midland llltilities

SOUTH

»■!;;.••
••

•

For

General Box

Insurance Co.

Midland Utilities

Rice,

(Special to The Financial Chronicle)

Smith is

_.

Trade.

Midland Realization
Write

We have analyses of

i Missouri Life

Members

of

been/added? to

Board- of Trade
..

'

ILL;—Thomas

staff

=a

Exchange

t

:

(IAN Co
Fred. W. Fairman CO. L
Stock

Fi

-

,

an¬

of

,

nounced.
•i

William A. Fuller & Co.

CHICAGO 1

Chicago

•; '

•

Barnicle

Burdick-Si-

Chicago Stock Exchange by

Com stock & Co.

Chicago Board

t

,

,

—r~'
?

/

filed Jam 31

,;,

.

:';

the

in

previously w-ithj

i.amsomBros. & C07 and Daniel
Rice & Co.

•

SINCE 1908 Ml—If

after serving

was s

J. /"

,

Board

Reorganization Plan

r:?-

Kearney &; Tracker- Corp4 Com.
-A1 ~
7.7 '££■..&

Dearborn

Loyti

&.

has become affiliated with David'
A. Noyes- &
Co.,? 208 South LA

rado,f Hermdn Magged and Joseph
—

Howard Aircraft

So. La Salle St.

Chronicle)

ILLi-LJohn

CHICAGO,

New Members Elected to

(io,, Ypsif

Coke

Corporation

231

with' Thomson & ?

last

-

Auto Company

Jordan

.

service? he

■

Drive

7 >v

has become connected with. Lam-*
son Bros.7&.,Co., 141 .West
Jackson
Boulevard, after serving in the
XT. S. Army.
Mr.
Prior to military:!

with the Continen¬

was

tal-Illinois National Bank.

Webster;.

subsidiary.

South.

Holloway

Roberts

Wheel

7

CHICAGO, ILL.—Dixon

I

*

*>

plant at West; Pullmanj

will

capacity about 50% late this

Four

'

La

[ CHICAGO, ILL. —John Whitcomb Holloway has become asso¬
ciated with Jas. H. Oliphant & Co.,

to

name

*

disc

new

Ind. . Rockford, 111.
Cleveland, Ohio
< 7,

&

South

■

[ Indianapolis,

Central. Coal

X.

Duffy has become associated with

Salle St.

Chicago's

said.

3

-

ex-*'

Supreme

V:*--

;?

President,

Davis,

by the corporation is
tjhe result of a long and intensive
"The

I

Teletype CG 405

:

S.

C.

Sjtudy, initiated in 1943, > of post¬
war opportunities and needs," he

*

Members Principal Stock Exchanges

10 So. La Salle St., Chicago

present

[stated.

>ml RDavis ScCo.
Established

corporation's

plants and manufacturing facil¬

ities,

Request.

on

to

the

pand

,

Industries, Inc., Pfd.

*Prospectus Available

$20,000,000, would
modernize and ex¬

proximately

of

debtedness; /

the

Z Court//®/:: /
777

; receive

free

property

mo/

court's decision, the case is

to

in

,

I)

(Special ta The Financial Chronicle)

....

j

principal exchanges
excnanges

and other

.Volume 163

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4464

neither of

Present Production Problems
t;

^

President,.Ford Motor Company

r

.

Wehave

,

refused to meett

ing hard at the problem together,
both of them with

kept everlastingly at it.

Furthermore,

',.»

^

us ever

both

,

,

.

,

,

est, .We do

Their Members.
We

Motor

Ford

the

at

problems these days that face most of you who are in the
? turing

| busi¬

to

fions

Itfthere-

ness.

I fore

automotive

face in the

'

was

"

./:/

Ford, Labor Relations

em¬

the job had decreased
about 34% during these same four
years. We said, in effect:
"We
gave
you
security, how about
your giving management'and the
company security?"
:/ / /
;. ;
on

the

pliers,
Let

trying to destroy the unions.

our

No. 1

talk

about

you
re¬

our

factions

I

to

to

a

s; as

to
problems.

I

word

of
problems

our

many

are

solved.

not

There

is,

you very

as

well

2nd

Ford,

Henry

know, a great
difference between

CHICAGO,
labor

our

Motor

Company,
industry, our

has

the Schmaltz
sup¬

and

me

perhaps all industry.
review briefly some of the

Chronicle)

James/ J/,
associated']

—

become

Co., !;

Clement,

Curtis

hereto he

Mr/

formerly

was

&

was an

with;

Co.

Prior

could

deliver

^American Service Co.

the

to

car-hungry
J /- C
:
| Actually, instead of 80,000 cars
American people,

.

and

Preferred, Class. A and Common

^

R. Hoe & Co., Inc.

trucks,

we produced 30,000.
good deal of satisfac¬
tion'frorp the fact that more than

Common

We take a

half

all the "

of

trucks

cars; and;

that/have been built in this

coun¬

try since V-J Day have, beeii Ford
r

V,, (Continued

on page

■

*E. & G. Brooke Iron Co.
'/:.'.//■/

;///>■' '//■':'///i/;/ Common

^Nat'I Terminals

?

867)

Corp.

Common and Preferred

ceeded in the friendliest fashion,

....

solving your Without. recriminations; or.;bitter »

fMich. Steel Casting Co.
'//r--;//•':,/ /y/:..;'//Common- -

Furthermore^ sinco Vrl vPa^
We see only one solution which there have been no strikes at the
■>
holds the promise of being sue-; Ford Motor.ComPanyi
cessful—but
before
I tell you
I do not want you to think that
what we think that is, I would our negotiations - have been any¬
like to, review briefly the condi- thing but
hard,; tough bargainingj
i >

them.

But both sides have kept contin¬

before
the Commonwealth Club in San
*An address by Mr. Ford

Francisco, Feb. 8, 1946.

v

nnouncing itie cliange of

.an

,

our

t

231

fiW/'f /

request

/

_

;

SOUTH LA SALLE STREET

V ';

CHICAGO 4, ILLINOIS

TELETYPE CG 361

v.

iair/#/:/

.-*•'

on

ADAMS & CO.

Teletype Number

ually in mind that the goal was!
to reach

-

* Recent circular

■

.

A

/

PHONE STATE Q101

mm

We have

agreement.

-r

NEW YORK

CG 28
FINANCIAL

/MARKETS

://■■■

Trading Markets

for the

ADVERTISING

*

Abitibi Power & Paper

;

All

In

Plans

i

Incorporated

-

131 Cedar Street

"

Brown

KITCHEN & CO.
Pfd.

135 So. La Salle

Company, Common

Teletype

»

New York 6, N. Y.

MIDWEST

—

STRAUSS BROS.
Members New Yorfc

St., Chicago 3, III
Telephone

CG 28

—

Security Dealers Ass'n

Board of Trade Bldg.,

State 4950

Chicago 4 J

Telephone: Harrison 2075

:>

Gaumont British Pictures "A"

Teletype CG 129

Telephone CGrtlandt 7'5060
Boston

Company 5/59

Brown Company 6% Cum.

Guenther Law

-

Co.; Com;

.\.-v

Brown

Prepared—Conference Invited

Albert Frank

<•<»-<

Branches

Its

Private

Mexican Corp.

Chicago Philadelphia San Francisco

Wire

Scherck, Richter Co., St. Louie

to

'

.

Direcf Wire to Neu) York Office

Minn. & Ontario Paper, Com.

Scophony, Ltd.

'■

\

:

.

'

i

;■

/V: Z'-'V;

American Window Glass Com.

DOCTOR

Vicana Sugar Co., Common
ryj/•'£>:?.■'•'/:;••.j/■'f•' >:////•:;•///■

/

-TENNESSEE GAS & TRANSMISSION

STRAUS & BLOSSER
f-

/'

;

vK. V'

>*,

\y

ft

^Prospectus available

Members Chicago Stock Exchange /'■

/

/

-

•

.

III.

Tele, CO 650*651

•

INCORPORATED

-

-:

r

CHICAGO 4

Teletype; CG 1200

~\

CONTINUOUS INTEREST IN.-

a!/;/-

THE SECURITIES

Koehring Cp.

./■■■■

Nekoosa-Edwards

DEEP ROCK OIL CORP. Common

NORTHERN STATES POWER CO. 6 & 7 Pfds.

/

\

v

:

Paper Co. 'i'.

Central Paper Co., Com.

;

?

Cons. Water Pwr. and Paper Co,
;

Wisconsin Power and Light
.

Compo Shoe Mach. Co.

/

Co|
;

Standard Silica Co.

1

Telephone, State 8711;
New York

•

Philadeiphia




'

Northern Paper

Mills Co,'

Froedtert Grain & Malt.
Hamilton Mfg. Co.

Pittsburgh

/

James Manufacturing

Co.;:'

OLLEY,DAYTON &GERN0R
Member—Chicago Stock Exchange

Chicago Stock Exchange

225 EAST MASON ST.
PHONES—Daly 5392

Minneapolis

All Wisconsin Issues

Cp.

'105 So. La Salle
■/Members

Teletype CG 273

Gisholt Machine

National Tool Co.

Incorporated

135 So. La Salle Street, Chicago 3

Macfadden Publications

OF

f H, M. Byllesby and Company;/
*

S. La SaUe Street

CHICAGO 3. ILLINOIS

CHICAGO SO. SHORE & SO. BEND RR. Com.

.

-

231

'//

V

Telephone: Dearborn 6161

>

,

"

vVV-^'5-Av^-'!.

.

:/

/New York Curb (Associate;

135 SOUTH LA SALLE STREET

CG 451

Maintain Active Markets Tnr-~

:
z

/ / /

New York Coffee & Sugar Exch., Inc.
-

Chicago 4, Illinois
Randolph 4690

Members

New York Stock Exchange

208 S. La Salle Street

Associate Member New York Curb

135 South la Salle St., Chicago 3,

request

DOYLE/O'CONNOR & CO
•

.

upon

?

f'.'j'yff Chicago Stock Exchange /v/./
'.
Chicago Board of Trade

Specialists '■ in Foreign Securities

-

Members New York Stock Exchange

Tel. ANDover 5700 /

.'•/ .'

/
4

\

,,

Pi

J/O'BRIEN
& CO.

OF CHICAGO

■

ZIPPIN & COMPANY

>

COMMON

CO.

;'
/'*

'«•

PEPPER

COCA COLA BOTTLING

>/:

V.-.'1//

ryy.;\//'ft

American iWine Co. !

<;•

JOHN

'Vicana Sugar Co. 6/55

Republic Natural Gas Com.
■.

ROBBINS & MYERS COMMON

Steep Rock Iron Mines

Greiss Fleger Com.

Chicago t

-

individual floor/-

,

problems and trying to live with

i

Schmaltz

111.

broker on the Chicago Stock
"
Ex-t ;*
Shortly after • V-J Day we made change,
some. • calculations and; announced
that
hoped .to be. able- to turn
out 80,000: Ford cars and trucks
Active Trading Markets
by Christmas. • ■ That seemed to us
'•//■ , ;//,■'
/'. /•'
..■ :■' ■/•
the ; best- Christmas
present we

"

tions" because

of

:

other conditions we face,

objective on our list of post* the same contract that provides
fori a* wage increase of: 18 - cehts j
war objectives and it seems to us
that we have made progress in an hour,"
the direction of mutual respect
I ^have /said/jthis before,r but
I]
and understanding) / -Throughout would like to repeat it here: It isi
this period of unrest and conflict, bur
feeling that the problem of i
the negotiations between the Ford labor and "management getting;
Motor ; Company and the -United "along together can only be solved
Automobile Workers have pro¬ by /labor and; management work- i

use
the
"reac¬

Ford

automotive

we

company

than

ter

are

do bet¬

James J. Schmaltz With

with Shearson, Hammill - &
importance, it is only .one of
major problems which face 208 South La Salle Street.

est

the

Thesei conditions, let me say,
hot all bad. / We are pleased,
for
example, by
the progress
which we as a companyhave plan - for/ "company
security,'
made in the field of labor rela¬ Which both sides will agree is
tions—ourf relationship with' oUr workable, but - we have- agreed
employees, i We marked this as a •that/such I a plan will be. part of

nothing that I
could

solution

a

relations problems is of the great¬

They took a try at the problem
themselves and they suggested a
solution which they liked better.
We have not yet worked out- a

^

any group.,

charge of the

Chicago office of Lobdell & Co.

(Special to The Financial

ing that end.
But what is significant is that the
matter /was. not dropped.
They
the position that

Shearson, Hammill & Co.

coerce

Taylor, Duryea & Co.; Inc. and;

in the past was in

Ford Production

achiev¬
They didn't like it.

didn't take

of

While

'We proposed a method

were

that

me

i

there

we

industry.

seemed

manufacr

Gov¬

be written to

773 unauthorized

productivity of

not think that

Carroll G. Taylor Is
<
Now With Adams & Co.

doing» something, that: they think
is unfair and against their best
interest.. We have tried: that in
the past and it doesn't work.
It
merely
makes / more Troubles.
There is a big field for sound
labor legislation, but it will not

work-stoppages in the four years
since that time. We also reminded

face the same

undoubtedly

Company

called the * attention: of
to the fact that,
although we had given the Union
in 1941 the security/for which
they asked by agreeing to the
closed shop and the
check-off,

ployees

ot

(Special to The Financial Chronicle)
/
■
provide the solution,
principal thing Which
CHICAGO,
111. — Carroll
G,v
Government can bring to bear on
Taylor has become associated with the / problem
is the legislative
Adams & Co., 231 South La Salle:
club,.
And you cannot coerce
great numbers of Americans into Street. He was formerly an officer ,

example,

them that the

sense

because the

Union, leaders

there had been

real

ernment can

tives; of the other side/ We, for

Leading Automobile Executive Points Out Decline in .Workers' Pro- /
ductivity and Asserts That Labor-Management; Problem Can Be
e*,
Solved Only by Both Working Harder r to Produce More, Cites
Increases in Ford Production Costs With Labor Costs Alone 100% *
Greater Than in 1941, as Problem That Must Be Solved in Face
v
of Fixed Ceiling Prices.' Says That With Suppliers of : Materials
Affected by Higher Costs, Ford Is Unable to Maintain Steady
Output, and Mass Production Is Prevented.) Asserts Ford Com;' pany Must Sell Car, Costing Above $1,000 at $728, and It Is
Only Able to Bear Loss Because of Reserves to Draw Upon. Con/ eludes "Only Road to Peace and Plenty" Is for All to Pitch in and
Work, and Calls Upon Unions to Popularize More Output Among
r

a

responsibility to the public inter¬

sides have
made specific and very - real ef¬
forts to achieve some of the objec¬

.

839

MILWAUKEE (2), WIS.
State 0933
•
•
Teletype MI 488

CG 262

St., Chicago 3t 111.
Central

'

U780

Offices in Wisconsin
Eau Claire

•

Fond du Lao

Madison

-

-

La Cross*

Wausau

THE COMMERCIAL &

FINANCIAL CHRONICLE

Morgan Stanley
Group Offers
Morgan Stanley & Co. and Dick
&

Merle-Smith with their associ¬

ates have

purchased and are reoffering at 103% and interest $18,7
000,00, Boston and Maine RR. first
mortgage 4's due July i, i960. As¬
sociated with the manager in the
offering are Blyth
&
Co., Inc.,
Kidder,. Peabody & Co., Lazard
Freres & Co. and Whiting, Weeks
.

&

Stubbs.

The

New

York

Stock

Exchange has approved the par¬
ticipation of member firms in the
offering. The bonds do not consti¬
tute

a

new

chased

issue jDiit

from

the

were

pur¬

Reconstruction

Finance Corporation.

The RFC is

understood, through this and other
transactions, to have sold all of its
holdings of this issue. Simultane¬
ously with this purchase the Bos¬
ton

and

Maine

chasing

REAL

RR.

is

itself

of ahe bonds for retirement.
will reduce their first

ESTATES

pur7

approximately $2,375,000
This

mortgage
as. against

.debt

to
$64,139,000,
$74,000,000 at the time of the issu¬

SECURITIES

ance

of the bonds in 1940.

dition

during the

In ad¬

Primary Markets in

period the
railroad has retired nearly $20,000,000 of junior bonds.

Hotel St. George, 4's

satisfactory results from its recent

Broadway, 4H's

purchase of Diesel engines for use
on
freight traffic. The road's com¬

) The Boston

165

putation

870-7th Ave.

of

operation

4K's)

r

Savoy Plaza 3-6's, '56
uVV)?1rVro.^'^r:-.i

Members New York Stock Exchange

road's
aggre¬

;

3% Treasury Bonds I

Members New York Curb Exchange

Dlgby 4-4950

WASHINGTON,

00

1-953

estimated

T® Redeem 3-*% and

SHASKAN & CO
PL.,N;Y.

Diesels

.

saving nearly equals the
fixed charges, which now
gate about $3,860,000;

Hotel, 4's

Bell Teletype NY

through the
new

an

been. delivered; ;; This:

•'•jV.-v ■»vv u•'

1

savings
these

aggregate oper¬
savings of approximately
$3,600,000 per year when all have

ating

40 EXCHANGE

and Maine has had

would indicate

(Park Central Hotel)

Beacon

of

same

Feb.- 14—The,

Treasury announced today that lit
will,call redemption on June 15,

the) outstanding

3V8%

Bonds due June 15,

issue of
Jure

Treasury
1949, and the

Treasury;;3%) ^

1948..

There

are

mately $818,000,000 of

approxi¬
the

3 Vs%
Bonds and $1,035,000,000: of 3% is¬
sue

outstanding,,

E. F.

•

'

)

Gillespie Resumes)

Eugene F. Gillespie is resuming
his investment business from of¬

fices at -15 Broad-St., New York

City,

as

President of E. F. Gilles¬

pie & Co., Inc.

Mr. Gillespie has

been

Colonel in the U.

S.

serving

as

Army Air Force since 1940.

Trading Markets Maintained:

SPECIALISTS

Broadway Barclay 2/56
Broadway Motors 4-6/48
Poli New England Theatre 5/83

Real Estate Securities

Savoy Plaza 3-6/50

;

,

Since 1929

Westinghouse Bldg. 4/48

J. S. Strauss & Co.
155

"•

'7,

Tele.

SF

61

&

62

EXbrook

-

41

1285

Broad

Real Estate Securities

Lott

'52—New

York

Hotels, Inc.—Chicago

Devon

Corp.

Detroit

Roosevelt Hotel, Common
1

St.

Louis 1

*

Street, New York 4

'

) '

Myles Standish Co. Boston

TRADING MARKETS IN
Broadway Barclay 2s 1956

N. Y. Majestic 4s 1956 W. S.
Roosevelt Hotel 5s 1964*.-

Fuller Bldg. 2V&S, 1949 W. S.

Roosevelt Hotel Common '•-<

Gov. Clinton 2s 1952 W. S.

Savoy Plaza 3s 1956 W. S..V
Sherneth Corp. 5%s, W. S.

Grant Bldg.

2^s, 1949 W. S.-.r

Hotel Lexington Units

40 Wall St. 5s 1966 W. S.v

;165 Broadway 414s 1958 :-V
r 870 7th Ave. 414s 1957 W. S,

AisioxT, Baker & Go.

135 So. La Salle St.

Incorporated

CHICAGO




•

-

Mayflower Hotel Corp. Stock;

"

Central 4402

:

Hotel St. George 4s 1950 V

V A LIQUET &CO
CG-81

'

HAAover 2-2100

Commodore Hotel, Inc. W. I.

Prince & Lafayette Streets
5«t

Incorporated

•*

Members New York Security Dealers Association

Montgomery St., San Francisco 4

150 Broadway
w

Tel.

LArclay 7-2360 '

'
.

)

.

;

;.r

New York 7, N. Y.
;

Teletype NY 1-588

V-'V

Thursday, February 14, 1946

^Volume 163

841

CHRONICLE

THE COMMERCIAL & FINANCIAL

Number 4464

Stuart & Co.

Governors of Association Decide That Attempt

-

f

of Firm io Arrange

-

The Board of Governors of the National Association of Securities
Dealers

Feb.

on

4

rendered

a

in the case brought to it on

decision

by Halsey, Stuart & Co.,<*—~—'
—
Inc., against a former ruling of amount of its ZVi% Series G bonds
the Business Conduct Committee which were redeemable only on
the
of District No. 13 of the Associa-*
semi-annual
dividend dates
and Dec.

"engaging in an unethical prac¬
tice;'' when the firm attempted to
arrange
a
competitive
sale
of

notice of its intention to

Connecticut

-

on

Bonds.

sale

The

Light ••'*&
of

the

entire

Power
bonds

in

and

hearing

a

tion
the

of

Connecticut

Commission. It

set

was;

before

Utilities

Public

at this hear-

was

firms in Connecticut,

ing that Halsey, Stuart & Co., put
in appearance and made an offer
to the company to buy the bonds
at

act

in

hand

price in excess

as

the

employment

the

of

hearing

On

about April 25, 1945,
discussions
with

or

further

approved the form of application
to be filed immediately with the

of

amount

J

Series

bonds

106.980365%.

price

of

mission for approval

ceeds

of this sale would

of the issu¬
The

plainant

"expects

to

sell

on

at

estimated

ducted

graphed the president of the com¬
plainant that "It is our opinion
can receive the highest pos¬
sible price for your bonds only by

you

offering them at open competitive
sale. We hereby request an 00-j

a

portunity to submit a bid for your;
proposed Series J bonds at open!
competitive sale. We are accord-

be $17,-

expenses

of

j ingiy

advising ;; the Connecticut
to this effect.
We
(Continued on page 865)

Commission

.

firms in!

two investment banking

a

hearing

April, 25, 1945. Upon receipt o!
such letter respondent tele-,

pro¬

these $35,000 and the finders fees of the

bonds through private sales to

of

matter was scheduled for

116,858, from which would be de-

of the Series J bonds.

application stated that the4 com¬

Satur-

of the Series J bonds and that the

its

,

1945, that complainant
an
application for ap¬
of the proposed issuance

18,

filed

the

after

The

Connecticut Public Utilities Com¬
ance

April
had

proval

complainant was advised
that eight institutions had agreed
to buy the $16,000,000 in principal

by private placement
Series J bonds, and

19, 1945. respondent
by letter from the

lic

agents,,

new

April

ap¬

such

on

the pub-H

Secretary of the Connecticut Pub¬
Utilities
Commission
dated

Commission

as

com- '

the Com-*?
April 25, 1945.

on

advised

was

plication.

to

complainant's agents to find

the

for

complainant

before

of

date

au¬

investment banking firms

nurchasers

it was desirable to. have all commitments

the

formally

On

con¬

18, 1945, and the Con¬
necticut' Commission,
being re¬
quired; by law to give at least
seven days' notice of the hearing

On
complainant's thereon, set April 25, 1945

1945

:

Commission at

necticut

therewith." This applica¬
filed with the Connecti¬

Utilities

the

lie hearing held before

April

on.

principal

in

in

expenses

increase

would

mission

was

cut;,;. Public

complainant's
3%
to bet dated May

Directors

of

thorized
two

concluded for various reasons that

of that to be day, April 28, 1945 Tor the sale
\
,
a
•« , " •:
following is the full text of the
a

Board

in March, 1945, the
complainant considered the possi¬
bility of refuning its outstanding
Series G bonds by the issuance of
additional- bonds at a lower in¬
terest
rate.
After, consultation
with
two
investment .banking

the Confirma¬

on

sale

the

tion

bonds

18,

Aprils

Beginning

question had already been ar¬
ranged privately by hte company
through two : investment houses,

nection

1, 1945 and due May 1, 1978.

for the

1, 1945 was $16,720,000.

June

J

Series

of bonds outstanding

issue

of;

amount

redeem.

The total redemption price

of the estimated

inter¬

be

1, 1945 of its Serves
bonds *and
that complainant

G

entire is¬

an

$16,000,000

of

sue;

thirty days in advance of

cation

in purchasing

ested

1 upon publi¬

of June 1

bank, would

comercial

ceeds

plainant's cash reserves by $321,-!
858. The complainant's president,
presented these facts to the Con- j

June

on

and afte^'-

redemption of the Series G bondst
at 104V2 the balance of the pro¬

"proposes at the time of the hear¬
ing to submit a statement of the
amount of the premium to be re¬
ceived from the proposed sale and

,

appeal

tion, which last November nad re¬
buked ,Halsey, Stuart &„ Co., for

tion

de¬

and

hand

in

posited with the Trustee for the
redemption of the Series G bonds
June 1, 1945.L ? ■ (\ 4: ■ • ;' • • "4 ,";.1 ' \
Through the services of the two
investment banking .firms com¬
plainant was advised that seven
insurance
companies
and
one

Reverses Verdict of District No. 13 Business Conduct

Principles.

.}

cash

ditional

Competitive Sale of Connecticut Light and Power Bonds Was Not
Conduct Inconsistent With Commercial Honor or Ethical Trade ?

of $40,000;

Connecticut

refunding issue
of Series J limited number of institutions, at
a
substantial rpremium ': plus ac¬
bonds',"to publish-notice to redeem
the outstanding. Series G bonas on, crued interest," that the proceeds
were to be used for the redemp¬
May 1, 1945, and to have the ad¬
a

NASD Exonerates Nalsey,

received under private sale. The
decision

the Board

of

of

Gover¬

of NASD in the case:

nors

v

*oa

(

4

ll

,

1

/

*

*'

'

<f'y u

{

i X*

^

I

In the Matter of

The

Connecticut

;.x:

Light

& Power

Co

35 Wall

■

Street,

/

•

/

Complaint No. 104, District No. 13

.

The Connecticut Light & Power

Company,

a
corporation organ¬
ized under the laws of, and doing
.

business in the State of Connecti¬

cut, filed this complaint on June

13, 1945 with the District Business

•

the? respondent, Halsey,
Co., Inc., a corporation

against

&

*

Pursuant-to the First- and Second
;

Series F and'bonds of other series issued under the First Mortgage may

:(a)

and

>

,,

'

\

-

The

'

entered into,
.'

the

upon

pleadings theretofore filed by the
parties and its decision was issued

;

| on Nov. 1, T945; finding that the
respondent ' had

violated Section
Rules, cen¬
respondent for such

1 of Article III of the

suring the
violation
and.

.

.

assessing

against

the

respondent the costs of the
proceeding. By, letter dated Nov.
.9, 1945 respondent made applica¬
tion for review by the Board of
of the

Governors

decision

of the

District Committee and requested

hearing upon the review and an
opportunity to file a brief. After
dup notice a hearing was held be¬

a

fore

members

of

the!Board

Of

1945,

at

case

with this

'
any

shall have

'

.

sinking funds

; ;

single bidder or by «/•

:

.Bids must be enclosed

■ .,//;■
■ /, '
y''" : '
with accompanying papers in a

;'
plain,envelope, securely

sealed, bearing no indication"'of the name of the bidder or bidders or the amount
of the bid, marked "Bid for Southern Pacific Railroad Company First Mortgage

Bonds, Series F,'' and addressed to-J. A. Simpson, Treasurer,, Southern Pacific
Railroad Company, Suite 2117, 165 Broadway, vNew York 6, N. Y.
A11 bids
must be received at that office on or before 12 o'clock Noon, Eastern Standard
.

Time,

on

February 18, 1946. Bids so received will be opened by an authorized
Railroad Company, at said office promptly after 12 o'clock Noon, j
on said date, ; Each bidder may attend the opening of
?

officer of the
Eastern

/

<■;

Standard Time,

bids in person or by a duly authorized representative.
Each bid must be
accompanied bv certified or bank cashier's check in New York Clearing House
payable to the order of Southern Pacific Railroad Com¬

4

the

funds; for $1,000,000.

the accepted bidder. The deposit so
will be-applied, to the extent

pany, such checks to be returned except to
made by the accepted bidder, or group of bidders,

respectively,

funds for such series of bonds,

thf^ purchase of not less than the entire

January

request.
'

calendar year shall be

Sinking Fund, the amount Of net income available for such

v

«

to

in proportion to the maximum amounts which would be payable into such sir.King funds, respectively, on such July 1 if the net income of the Railroad Company
for* such calendar year had been sufficient to make such maximum payments.
The amount to be paid into this Sinking Fund in any year may. be .increased to
the extent provided in any supplemental indentures creating other series" of

Bonds of Series F will be

ttw principal amount

..r,.v

for

Th^JRailroad Company invites bids for

from

this Sinking Fund will be the amount

the net income of the Railroad Company

shall be prorated among the sinking

,

provided in said Form of Bid, on the purchase price of. the Bonds. No interest
will be allowed on the amounts of checks furnished by bidders.
- . 1
7The Railroad Company may accept the bid deemed by it to be most advan-

,

.

r'-, tagcous, but reserves the right to reject any and all bids. Unless the Railroad
Company shall reject all bids, notice of'acceptance of tie most favorable bid,
bonds, but the principal amount of Bonds of Series F to be redeemed in any one
subject to the approval of the Interstate Commerce Commission, will be given
year out of this Sinking Fund shall in no event exceed the principal amount ofs?v:;£
orally, or by telephone or telegraph, to the successful bidder or to the represen¬
such Bonds, which, at the Sinking Fiind redemption price applicable to such year, ...
tative or representatives of the successful bidder not later than one o'clock P.
can be redeemed with the-moneys payable for such year into the Sinking Fund
4 Eastern Standard Time, on February 19,f 1946. and all bids shall be irrevocable ;f
on accountbf Bonds of-Series F.
J"-'; ■
'v *
"
■
until that time. Any bid not accepted at such time will be deemed to have been
•••'■
No payment into this Sinking Fund on account of Bonds of Series F shall be
J rejected. ; The determination of the most favorable, bid will be made on the basis
?
i
required in any year if prior to July 1 in such year all of the Bonds of Series F; ;
of the lowest net interest cost, arrived at by computing at the rate named in each
shall have been retired or shall have matured or been called for redemption but
r
bid. interest for the term of the Bonds of Series F, on the full principal amount
; not been presented for payment.
• ;
;
*
v .' •' 1 ' •
and deducting therefrom the premium, if any, or adding thereto the discount, if
-""'Payments into this Sinking Fund may be made at the option of the Railroad /.. -.any, resulting from the price named in such bid.
■
/,;J.4./••/•/••!///
Company either in cash or in bonds of any series issued at any time under the
/! / The successful bidder or group of bidders will be furnished with a favorable
?
First Mortgage,, other than Bonds of Series D, at the principal amount
^
opinion of Messrs. Cravath, Swaine 8c Moore as to the validity of the First Mort¬
'. y. - or partly in cash and partly in such'bonds." All moneys paid to the Trustee for ;
gage as supplemented by the First and Second Supplemental Indentures thereto,
this Sinking Fund shall be applied by it to the purchase of bonds of any series
of the Bonds''of Series F and of the guaranty thereof, and the successful bidder/'
4 4 issued at any time under the First Mortgage, other than Bonds of Series D, as
or bidders shall
have no fight to refuse to purchase the Bonds of Series F on
V
the Railroad Company may instruct, at private sale or in the "open market, but at
the basis of any questions as to such validity if such favorable opinion shall be
V
a cost
(exclusive of accrued interest, brokerage charges and other expenses) - not;; \ %
furnished.
;•/:/ /.,/'■/ /■
v/ .V/:*.Vv
.7-/
exceeding the respective sinking fund redemption prices for such bonds, on the
A copy of a draft of the Second Supplemental Indenture and a copy of the
•; ."4-4date of such purchase, or, if not redeemable for sinking fund, ..the respective ■ ; ;
First Mortgage (to both of which reference is made for a more complete descrip¬
V V optional redemption prices of such bonds on the date of such purchase, or, if
tion of the terms of the Bonds and the rights of the holders thereof), a copy of
/-'.. not redeemable, the principal amount thereof.
Except as otherwise provided in ,//
a
draft of the Agreement between Southern Pacific Company aftd the Trustee
the^First '^upplemental Indenture and in the Second Supplemental Indenture,. .
under -the First Mortgage providing for the guaranty of the Bonds of Series F,
the Railroad Company may, at any time, beginning July 1, 1951, call for redemp¬
and a copy of the application to the Interstate Commerce Commission and
tion for this Sinking Fund an amount of Bonds of Series F, or bonds of any
7
accompanying exhibits are available for inspection at the office of the
y - series, issued under the First Mortgage, which are redeemable for this Sinking
t Suite 2117, 165 Broadway, New York 6,;N. Y., and at the office of the
,
/.
Fund, up to the amount which will exhaust the moneys then in this Sinking Fund, y The Chase National Bank of the City of New York, 15 Broad Street, New All bonds delivered to the Trustee on account of thin Sinking Fund or purchased
York 15, N. Y./and at the office of the Assistant Treasurer of the Railroad Comor redeemed
by the application of moneys in this Sinking Fund, shall be can¬
pany, Room 654,"-65. Market Street, San Francisco
'- —/ .
celled and no bonds shall be issued in lieu thereof.
"r
^

13

which the Railroad Company

'

•

? v'iU be considered.

provide for the full sinking fund payment described in the pre¬
ceding paragraph and the full sinking fund payments to be made on the next
succeeding July 1, on bonds of all series then outstanding which, under the pro¬
visions of the First Mortgage and the provisions of such bonds, rank pari passu

V?

District

In

insufficient

Trade Practice

considered by the
Business 'Conduct1' Com¬

for

the annual payment Into

specified in (a) above.

case was

District
mittee

^ ' "* "•

v

1,"'194 6, to'the date of deliver^ No bid stating .a price of less than
of the Bonds^of Series F, plus accrued interest,
A s stated, in the Form; or Bid. accompanying the Request for
•'Bids, bearing even datfe herewith, the obligations, of the several members of ay
proun cf bidders shall be several and not joint,
All bids must be submitted in
duplicate' ont the said Form of Bid,;which,! together with the draft of Circular
retting forth information concerning the Railroad Company and the Bonds, is
being distributed to persons of whom the Railroad Cmnpans' has knowledge as
being possibly interested in the purchase of the Bonds. Copies of the draft of v
Circular may be obtained from the undersigned in reasonable quantities upon

"

provisions of the following paragraph, whichever sum is less.
provides that, if the lease of the Railroad Company's railroad
properties by Southern Pacific Company should be- amended • (-other than the
renewal or extension thereof on the same terms), or a new lease entered into,
which would result in reducing the net income of the Railroad Company below
what it would have had if no such amendment had been made, or new lease'

,

;

Vs

group

The First Mortgage

section 8 of the Code of Proced-

'

Series E
the First

as

accordance with the

ing upon its own motion: under

Complaints..

one per cent; of the principal amount"of Bonds of
Series F theretofore authenticated and delivered under

equal to

in
of

be retired,

otherwise then through the operation of any sinking fund
shall not have been presented for payment, or (b) a sum equal to the amount available therefor out of ?
the net income of the Railroad Company for the preceding calendar year in :

not set the matter down for hear¬

for Handling

sum

Bonds of

of Series F which shall have matured or

Rules, and thereafter both com¬
plainant arid respondent file ad¬
ditional pleadings. Neither party
requested a hearing- before the
District, Business Conduct Com: mittee
and that Committee did

ure

%

of bidders. If a bid is signed by a; representative on behalf of a group of *
y bidders, each bidder makes the representative the bidder's agent,.duly author-;.
ized to bid, to improve or vary the bid, to receive acceptance or refusal thereof,
/ to receive notice of closing, to accept delivery of the Bonds and generally to
represent, act for and bind the buyer in respect to the bid/its acceptance, refusal,
improvement, variance or performance, and the represeqt$Jiv;e warrants that he
has such authority.
Each bid must name a specified price, plus accrued interest /

for bonds issued under the First Mortgage, but which

Association

the

,

Issue of.the Bonds of Series F.:'Bids may be made by a

^ called for redemption,

July 3, : 1945 denying that it
violated

*

The proceeds of the sale of the First Mortgage

v .. .

;Bonds of Series F retired through any sinking fund fpr bonds issued under the
First Mortgage and (ii) the principal amount of Bonds of Series E and Bonds

The respondent filed its answer
had

"4 ;

amount, outstanding in the bands of the public.. There are also
$25,000,000. principal amount, First Mortgage Birds, Series A. due January 1,
principal amount, Fjrst Mortgage Bonds, Series B, due

y!

supplemented >by the First and Second Supplemental Indentures,
less (i) the principal amount of Bonds of Series E and Bonds of Series F there"f^O'stofore surrendered to the Trustee and cancelled, except Bonds of Series E and

*

■

a

Mortgage,

.,

Article III of the Rules of Fair.

on

^

Bids

/ January
1, 1986, issued and outstanding in the hands of the public, and
y $25,000,000, principal amount. First Mortgage Bonds. Series D, due January 1,
1996, owned by Southern Pacific Company,'all of which aye guaranteed as to \
principal and interest by Southern Pacific Coinpany. There have been sold, sub-,
ject to approval of the issuance and sale thereof by the Interstate Commerce
: Commission,' for which' application is now pending,
$50,000,000,/principal
'y amount, First " Mortgage Bonds, Series E, to refund the above-mentioned
4 $50,0QP<000i principal amount, of, First (Mori?gaKe Bonds; Series B;^-;o
■■■*:':*■-7/

First Mort-

each year,

ofc, CommerciaWhonor

Practice.

to the

the Railroad Company will pay to the Trustee on or before July 1st
beginning on July 1, 1951, as a Sinking Fund by which the Bonds

gage,

.

and Just and /.equitable principles
of trade, in violation of Section 1
of

:
SupplementaT Indentures

t;

organized under the laws of Illi¬
nois and a member pf the Associ¬

standards

Company

y 1961, and $50,000,000,

-

-

ation, maintaining - an office in
New York City? alleging that cer¬
tain conduct of respondent had
boerii?inconsistent -imtbiShigh

"J'

principal

■jf

.

Conduct: Committee of District; 13
Stuart

1

applied to the retirement or redemption of the Railroad Company's First Mort¬
gage Bonds, Series C, due January 1, 1996, of which there are now $50,000,000,

a

.

•

1

% Bonds, Series F.

'

DECISION

.

\

t

.

.

Y.

Respondent

'

...

f

V y The issuance of the Bonds of Series F and'the sale of $50,000,000, principal
fl amount, of the Bonds of Series F, and the guaranty thereof, require authorization
of the Interstate Commerce Commission.
Acceptance of any bid will be subject
to and contingent upon obtaining such authorization.

Railroad Company, hereinafter called the "Railroad Com-'
• "pany,'v hereby requests bids for
> ;
f
N
~
' .
k'
$50,000,000, - principal amount, First - Mortgage Bonds, Series
herein- '
after Called the "Bonds of Series F"), to be dated January 1, 1946;.to mature January 1, 1996; to bear interest (payable semi-annually on January 1 and,.;
;
• July 1 of each year)at a'fate (Which must be a multiple of'%th of 1%) to
be named by the accepted biddet; and to be secured by the Railroad Com-: -•
pany's First Mortgage, dated as of July 1, 1945, as supplemented by First and v
:
Second Supplemental Indentures/ each dated as of January 1, 1946 (herein¬
after called the "First-Mortgage";), to The Chase'National Bank of the City
of
York, as Trustee.
< The Bonds of Series F-Will be'guaranteed unconditionally as to both principal
;• and interest by endorsement by Southern Pacific Company.'- . /;
Cv
The Bonds of Series F will be issued as coupon bonds in the denomination of
S 1,000, or as fully registered bonds in denominations set forth in the draftx>f the -:
Circular hereinafter mentioned. They will bfe redeemable-at the option of the ,
Railroad Company, as a whole, or in part by lot, at any time, on not less than
60-days'published notice; at prices determined in; accordance) with the! formula
applying-to optional redemption set'forth in the draft of. the Circular.,
a.
j
f' Southern Pacific

}

.

New York 5, N.

""

/

$50,000,000 First Mortgage

vs.

"-*»»—t

>t'

for

Company, Compla'nant
Halsev

\

j, -

Invitation for

Dealers, Inc.

•-

Railroad

Pacific

Southern

Board of Governors

National Association of Securities

-

>—v,

'

.

.

thereof,

.

Dec.

12,

Governors

on

which both

parties presented oral

argument., A brief was also filed

undersigned,
Trustee,

_

by respondent.p

,

5/California/';
RAILROAD COMPANY

»

;fr During the early part of 1945
and
'

for

a

number

of

years

.

;

prior

*

/

SOUTHERN PACIFIC
?? /;

•

V

By J. A. SIMPSON,

Treasurer

thereto, the complainant had out¬
standing

$16,000,000. in principal




■

"*

■

»1
1^

.ii
'A

t

I

i

>

f 1

i

THE COMMERCIAL &
FINANCIAL CHRONICLE
prospective merger of Pere Mar¬
quette into the parent,
company;
It is expected that
this offer will
be reopened and
approved by the
boards of the two roads at their

RailroadSecurities

regular

While high grade rail bonds push steadily forward into new high
ground, as typified by the record low interest cost on last week's
Union Pacific Debentures, rail stocks remain in a narrow price
range

with

the

tone

generally on the easy side.' One of the notable ex¬
ceptions has been Chesapeake &' Ohio common.
Having turned in
a
disappointing market performance for quite a spell while specula¬
tive

enthusiasm

investment

held

issue

thisf

sway,

has

recently'

been

attracting considerable new
buying interest at the highest

gan running an excess of current
liabilities over current assets, a
condition

which

materi¬

not

was

prices reached in many years. Harassed
by a heavy excess

ally bettered through Sept., 1945,
This naturally in turn resulted in

profits tax burden during the war
years the company had difficulty
in showing any material margin
of
earnings over
its
dividend

a

for

the

four

1941-1944, inclusive. Last
lieu

of the

cash

distribution

a

extra

for

Pittston stock

one

each

40

shares

of Chesapeake & Ohio. With the
heavy tax burden and mainte-^

of

nance

dividends

the

road

;

eral

industrial

activity,

More¬

over, 'accelerated amortization of
defense
projects r resulted in a

be-

5s,1927

i|.;&

coal,

St. Paul Jill

5s, 1975 & 5s, 2000

mines. On the basis of the
present
prospects it seems reasonable to

expect 1946 earnings of at least
$4.50 a share which would fully
justify confidence in maintenance
of

Alabama Mills
•iv1-

-,V 'i1/: '•/ :(-£' '■> £
; t;.*

•-£ y $?!.:/ '■ b *-•

'Zcy;

,.(•£ fSi'-'i?,1

*4^'

V

\ '.V

-

the

$3.00

regular and $0.50
extra dividends, In fact, in many
quarters it is
anticipated that
C. & O. stockholders may look
forward to

,

■

an

distribution.

Timm Aircraft

'•

-

;

■

7i

even

'

liberal

more
>

<

The recent strength

-

>.•

in Chesa¬

peake & Ohio common has natur¬

ally again turned attention

to the

the

j

n

he

was

this line of thinking
proves
rect

both

quette

classes

preferred

sideraly

-

of

at

.

cor¬

&

Pere'Z Mar¬

thrown

stock

underpriced

are

at

; con-

Stock

and

3 V2 °7o<:-

one-third of

share
0.4

stock

of

the

is

to

new

and

,

money' market conditions." - With
the convertible feature
very close
to
the
market

andprotection

from losing the stock
through call
for a few years at least, the stock
should command a wide premium
«-«-the general feeling is around

115

to

120.

On

such

Pere Marquette

a

basis

the

prior preference

would be worth between 135% and

"

1

of

"

;

Liberty's, holdings

,

of

-

200,000
stock

shares

investm ent

remain unaffected by these sales#

ing

Affiliated
Fund, Inc.;
J A m erican
•

share

for either, three, or five
years. The
cohversion price works out to

mil¬

60

Autocar

common

funds, includAndrew J. Lord

common,

>

which had received the shares as

more

lion dollars of

receive- 0.R

preferred

preferred represents approxi¬
mately
$1,000,000
for
Liberty
car

dividends.

than

share of

of Chesapeake & Ohio
The preferred is to be
convertible * into'- 1.6 - shares-, of
Chesapeake & Ohio common and
will
presumably be non^callable

;&;.'K-i>'

•

•

Sale of the two blocks of Auto-

soring

Chesapeake & Ohio; common.; The
preferred

,

houses, .spon¬

preferred
a

ber.
.

vestment

The prior preference stock
is to
one
share of new Ches¬

Ohio

of. the

untry's
largest in-

r,r,.:"Vv.,

&

Lord, Abbett
Co., Inc., is

co

recent

levels.

Ver¬

N. J.

one

Payne, Chairman of
Liberty Aircraft

of

Corporation; announced
that Atlas Corporation has pur-,
chased an additional 20,000 shares
of Autocar Company 5%
converti-,
ble preferred stock from Liberty.
This transaction is pursuant to the
option granted by: Liberty, at the
time Atlas purchased the original
block of 20,000 shares last Decem-i,

his home

New

non,

H,

board

Products

from his horse
near

Oliver

;v

u r i es re¬
ceived when

peared and the general
feeling is
that the plan will be consummated
over the not too
distant future. If

■

Chicago, Milwaukee

V-

ap¬

just
large tax credit in 1945. The com¬
about 62% for Chesapeake & Ohio
pany had net working capital of
or
practically on the market at
only about $3,000,000 on Sept. 30 the
present writing. .
and; by the end of November this
: Without any conversion feature
had jumped to almost* $33,000,000..
the new Chesapeake" & Ohio
pre¬
Traffic so far this year has been
ferred, -with a. dividend rate? of
holding close to the: ljevels'.of a
3 % % protected
by a wide, mar¬
year ago and should continue at
gin of earnings even .in 'depres¬
high levels unless adversely af¬
sion .years, • should
be worth
a
fected by labor - conditions in • the
jprcmium over .parrunder* present
steeL-mills • or lafet in; the

Chicago Railways
Cons. "A"

forthcoming./
,

x>f

Co., Inc., 63 Wall Street,
City, died in Memorial
Hospital, Morristown, N. J., from
New York

pro¬

apeake

was

Buys Autocar Stock
From Liberty Aircraft

head of Lord,

Abbett &

receive

Naturally' the whole • situation
changed dramatically for the bet¬
ter late last year. Repeal of the
excess
profits tax was taken to
virtually assure higher earnings
for Chesapeake & Ohio given no
more than a normal
lev^l of gen¬

was

Andrew J; Lord,

.

investors'

some

Andrew J. Lord Killed

posed treatment of the junior
pre¬
ferred stock of Pere
Marquette
but no formal
opposition has

tax relief

in

year

share

meeting sched¬
uled for Feb. 19. Some
objections
have been voiced as to the

as to the possibility of con¬
tinuing the dividend unless some

years

there

of

in

minds

payments. However, the regular
$3.00 a share and $0.50 extra were
maintained

question

monthly

Thursday, February 14, 194(3

Elder, Wheeler & Co,

;

Is Formed; NYSE Firm

Business Shares, Inc.; Union Bond
Funds; Union Preferred Stock
Fund, and Union Common Stock

;

O,'L. Gafrison Eldfer/ BieuLi and
IVilliam A. S. Wheeler,/ Lieut.

Fund.:. Prior to forming Lord, Ab¬
bett 8c Co, in 1929, Mr." Lord was Comtpander/U; S. .Navy, recently
released
from
active duty,
anViee-Presidenf of Shields
Col
and > was connected with S. W. hounce 'the. change of *their firm
name from Elder & Company to
Strauss Company.
He wds chairman of the Boa^d Elder, Wheeler & Co.;" members
of

: Research

and

Council, Inc., and

of the New York Stock

Management

•

Exchange.'

The" firm, which has been inactive
since the fall of 1942, .has"offices

director of the
Savings Bank of
a

Morris County
at 61 Broadway, New York City
Morristown, N. J., and the Atlan¬
and
735 Broad Street, Chatta¬
tic Coast Fisheries Co.
He was
Vice-Chairman of the MorristoWri nooga, Tenn., and has resumed its
activities as specialists and Un¬
Chapter of 3 the American. Red
derwriters of Soft Drink Bottling
Cross and was Chairman of the
-

Chapter's finance committee.
was

a

member

of the

securities.

He

executive

-

National Asso¬

Burton Marks Joins Staff

Investing Companies,
He is survived by* his wife, Mrs.
Evelyn Wiggins Lord; three chil¬

Of Bache & Co*,: Detroit

dren, Barbara, Andrew James, Jr.,

Marks has become associated with

Committee

of the

ciation of

(Special to The Financial

•

DETROIT; MICH.

Chronicle)
—

Burton

and

Drew-Anne, and two brothers, Bache & Co., Penobscot Building.
140% (now selling around 116)
Dr. John Wesley Lord, pastor of Mr. Marks has been serving with
and the preferred would
the U. S. Navy.
In the past he
be. worth the First
Methdoist
Church of
was active as an individual floor
"between 116% and, 120%, (now
Westfield, N. J.; and Dr. C. Don¬ broker on the Detroit Stock
Exf
selling aroundj94). ' v\i
•
ald Lord of Glen Hock, N. J,
change.
1
^

MEMBERS

.

New York Stock Exchange and other
leading Security and Commodity Excts.

120

Railroad Bonds anil Stocks

Broadway, New York5,N.Y.

231

So. LaSalle

St.,

RAILROAD SECURITIES

Chicago 4, 111,!,

PRIMARY TRADING MARKETS

&.

0.4V2S, 5s & 6s
57sf Stpd.
Chicago & Alton 3s, 1949
Chic; & East. III. 5s/97 ;
C. M. St. P. 41/28/2044
Chi. N.W. 41/28,1999
Chi# R. 1.4s, 34 & 41/28,60

Members New York' Stock

61

SECURITIES
Selected

Situations

all

at

Broadway

;

Int. Gt No. 6s/52

Exchange

;

New York 6

Telephone—DIgby 4-4933

Bell

Teletm-^m

:

1-310

Times

St. Louis

CUARANTEED RAILROAD STOCKS-BONDS

V

INCORPORATED

/

-

San Francisco

Railway Company

25 Broad Street

New York 4, N, Y.
Telephone Bowling Green 9-6400
Teletype NY 1-1063

:

No. Pac. 3s & 6s, 2047
St. L. S. F. 4s,4i/2s,5s&68
Soi Pac; 4^8,69, 77 & 81

Third Ave. Ry, 5^/60 /

B. R. Sc P.

PFtUGFELDER, BAMPTON & RUST

RAILROAD

Lehigh Valley 4s. 41/28
|MOP,4s,5v5%s&5i4i

C;C.CSt;i:4%8,1977i
DeL L/&;W; 4-6s/2042 S
Illinois Central 41/28,5s/63

Specialists in

Our

v

Boston & Maine

iv.'

'••/>

•'

•

-v.

\i

•;

.

.

,

V ':4t

•'

•.

,

own

New York,

&;

120
J

Broadway

89 Devonshire

St., Boston

'

::

3
/

•'.

We have prepared

;

Adams & Peck

a

brief memorandum

Lehigh Valley Railroad

on

General and Consolidated 4s-4%s-5s, 2003

::X'l y yy !/£%.•'. *

A

copy

of which

we

would be pleased

to send you upon
request.

!

•

"

'y;>ry

Tele. NY 1-724

Hartford




1. h. rothchild &

Circular Upon Request
'*^V'./"--

l

-

52 wall street

of Securities Dealers, Inc.

HAnover 2-9072

n.

y. c.

"

>

•

'

w

"

9.,?:*• -i

: Members New York Stock Exchange i

ONE WALL STREET

Member of National Association

•

^

Mclaughlin, reuss & co.
.v

Wall Street, New York 5
Philadelphia

TWX-NY 1-1950

TWX-BS 208

v

Boston

connect

Hartford. 3;.;

LAfayette 3300

'

9-8120

and

New York 5

,-v

COrtland); 7-9400

i V '

GETCHELL MINE, INC.

BOwling Green

Philadelphia, Button

J. Arthur Warner & Co.

BRDsi&lcai

Bought—Sold—Quoted %

63

H., 41/28/67

Colony 5s & 5V^s

direct private telephone9

Telephone REctor 2-7340 *

Prior Preferred
".

Old

request

Members New York Stock
Exchange.
BROADWAY, NEW YORK 5, N.

g Railroad

i'. '•"»

:

on

120

'nv;,:-.

N. Y., N. H. &

Norfolk Son. Ry. 58/2014

(when issued)

Complete arbitrage proposition

SUTRO

Morris & Essex 4V^$ & 5s
N. Y. Central '4s/'4V5|s:4;-5s

5

TEL.

HANOVER

-

2-1355

;

NEW YORK 5
TELETYPE

NY

1-2155

Tele. NY 1-1293

Philadelphia

Telephone

—

Lombard

9008

v

•

Volume; 163

u

THE COMMERCIAL & FINANCIAL CHRONICLE

Number, 4464

/

843

Richard West Director
"Our

Reporter

Governments"

on

of
;

Irving Trust

{j

Harry.E. Ward, Chairman of thje
Board of Irving Trust Co., an¬

By JOHN T./CIHPFENDALE. JR.

-

-

NSTA Notes

.

"donothing"attitude of the Treasury along -with scarcity ojf nouncedathe election of Richard H.
West as
director of the company]
| offerings and the belief -that prices will continue to rise, has brought
Mr. West is
■
aboiit a spectacular upsurge in prices of Government bonds>•/ Den
Vice-Presi¬
The

"/ ■

*

| spite
!

some

profit-taking, the long-term restricted: bonds which are

be headed for higher
2V2S apparently on their way to a
2.20% yield basis.
This trend toward a lower yield basis-makes
it easier for the Treasury to issue long-term. obligations with &
lower coupon rate when, as and if the money managers ever decide
to use such a security again.
•"
the ' bellwethers of the -market,- seem to

now

"

levels
*

with the recently issued
.

•

.

.

..

I

.

On the other hand, this sharp up-trend inHhe prices of the

1

j

T,

long-term restricted ^obligations makes it practically impossible

; *r

for the Treasury to offer '%V% % bonds, because there would be j
Plenty of criticism if more 2J/ks were to be issued with the out- •
standing securities selling at such a Substantial premium. . . . 1

t

It would most likely be; poirtted out that the Government should
be able to sell long-term bonds on a better yield basis than corporal
tionsv //i Recently 'through investment ^bankers, "there were sold t<j>
the
public long-term corporate obligations that yielded undeh

,

2.50%....

The

About four hundred members and guests attended the
twentysecond annual dinner of the. Boston
Security Traders Association at
the Copley-Plaza Hotel.
_

trust business.

//Prior to as¬

Thomas Graham,- Bankers Bond Company,
Louisville, President of the National Security- Traders Association,
a guest.
:

suming those
duties/several
years ago, he
was
promi-

was

phases dif the
c ompany's
lending ; and
investing ac¬

mittee

substantial increase- in

prices of Government bonds raises
the question, "Where is the Government bond market going?" . . . j
With the tremendous supply tof money, there will, be no increase
/; in interest rates*
v
.;However/the'present/ trend in Government
1 bond prices has taken them to levels where it is no longer a question
t of low interest rates.Bond
yields; are now approaching the point
t^yhere there; is considerable concern! about the effect-that this trend
will have on our financial institutions.
This, it seems, is not ap
^ important as the political factor Of lower and lower interest!rates;' I. {♦
'. Those that are interested in sound debt management and a stabilizar
/
tion of interest rates, to avoid future unfavorable developments, seenji

ald

to be in the

minority, politically.

Although

.

...j

...

further decline in interest rates is certainly not !

a

warranted,, there will be mo * Stabilization unless the supply- of j
Intermediate and long-term obligations is increased.
If the j

/•„/

.

^/Treasury

/

.

.

only certificates in- the-refunding, then the* long-

*uses

term 2^s may go right-on through the 2.20% basis and event-

j■
1

'

ually end

up

yielding only 2%.

;,

{

-

John W.
com¬

Goldman, Sachs & Co.; Herbert

M.Whitcome, Spencer Trask

Bell &

&; Co.; Albert G. Woglom, W. H.
Co., Inc.; and James H. Goddard, J. H. Goddard & Co.
^

Irving
in

Co.

1930, Mr. West
wide

Wm, Goslson Receives Public

Richard H. West

ex¬

perience ip

the commercial field

both here and abroad.

-

,

.

was

William J. Burke, Jr., May &
Gannon; Walter F. Eagan,

Hunnewell & Co.; Arthur E.
Engdahl,

Before join-

had

were:

(iharge of the affair

Other members of the dinner

,C. Smith, Blyth & Co., Inc.; Henry
Larson, 'First Boston Corp.; Regin¬

tivities.v
^

Trust

.

,

Chairman of the committee in

Altmeyer, Hayden, Stone & Co.

ing

'

WHAT'S THE ANSWER?
;

BOSTON SECURITY TRADERS
ASSOCIATION

Irving,
in
charge of. its

heht in many

,

^

the

Of

dent

Legion of Merit
At a ceremony held in the Pen-,
tagon, Colonel William H. Coulson/

Sees Vital Role for

a

resident of Garden

City, N. Y.,
Smith, Barney & Co. in

who left

Cost Accountants
David

June of 1942 for active duty, was

presented. with

B^^'amlnez^'/rAssistahi

Controller of Hyatt

Utility Securities

(Continued from page 836) '
1946 and building
and mainte¬
nance costs will be sharply higher.
(5) With present bottleneck?,
strikes and delays/ it may be a
long time before there is any fur¬
ther substanial gain in residential

the
Legion
of
Merit by Major General Glen E.

use

of current due to
and

ances

new

homes.

new

appli¬
In

the

Bearings Dirvision, General Motors Corp., adr
dressed the Brooklyn Chapter of

Edgerton, / Director of Material,' meanwhile, however, increasing
Headquarters, Army Service operating costs will be cutting into
Forces.
Colonel Coulson's citation net earnings, -except where the
the National Association of Cost reads as
utilities are permitted to retain
follows:
V
Accountants at the Central Branch
v
"Colonel William H. Coulson, substantial tax savings. ,
^
of the Y.M.C.A.; 55 Hanson Place,
The conclusion appears to be
/: General Staff Corps, Army of
Brooklyn, N. Y., last Wednesday
the United States, served with that; no "rule-of-thumb" forecast
evening on the subject "Physical V distinction to himself and
great can be made for utility securities
Unit Budgets for Factory Control
benefit to the purchases and as a whole—the outlook for each
and Other Budgets for Management
'0'^Renegotiation Divisions, Army Individual company and security

This would make it possiblei for the Treasury to use "perpetual
il!2s,"*that have ^been largely/in the ^background^but which may be
Control."
He stated that industry
Service Forces, from July 1943 must be closely analyzed in the
Vmord prominent in dhe future,
i The'market, through the lack^oif
faces
a
challenge. during "the
to November 1945, He material¬ light of taxes/ current regulatory
: I/action on 4he part of the "money managers/' would: probably apl
period i; ahead—the challenge to ity contributed to the developf- methods/ refundings, etc.
A proachlevels where:a 2% {obligation could be
While
tsed, in about a yeaii;
,/:r

.

,

/•'.

.

Short-term refundings plus a 2%

.

obligation would cut the cost

of carrying the debt burden, provided the inflationary forces have
not gotten out of hand in the interim to bring about a higher level

j of interest rates.
t

up

Institutional buyers continueT to rub
dhe prices'of/outstanding "GoVernment/bbligationsv and *bUy longt
;

.

So-long

as

reach and maintain levels of high

output, high level continuous em¬
ployment, pay high wages and sell
at low prices.
In order to meet
that challenge it will be necessary
for industry to operate at highet

ment and

;/

the

cient organization to

balance, analysts should do their

operation of an effi¬
administer
the
complex
responsibilities
charged to the War Department
by the Renegotiation Act."
1

} 4erm corporate bonds at record high prices, 4hat; even,then go to 4
levels^pl
^premiumv therb can be very;little hopeIfor-stabili2ation-4rt Governi fore. " w" efficiency»than' eve^bef
'
'
Whitney to Start
^ment bond prices/, ./In the past/iiflhe corporate^bond market, large
Mr. Caminez ^also stated 'that
|) buyers have refused to purchase; bonds 4hat 'fhey ^believed were -too intelligent planning and sound Ramie Firm
It has "been
high in price.

.

..

■

.

•

1

i

WAIT AND SEE
A

1

•

/ seems
'

little

watchful

waiting

on

the part of institutional buyers

to -be worth consideration!' at this, level of • Government ibond

prides.//» . The future trend of the bond market depends tipohtw^
things,the'attitude of the Treasury and^he attitude of the^biiyers. ; [.

*

*

While there'seems to- be

a

considerable support fer -the belief

!

budgeting

/

necessary

will

procedures

needed to attain the

be

productivity

to do the job ahead.

He

dismissed the vital part that cosi
accountants will play in this com¬

petitive market and the import
tance of budgets for .cost control, i

Diat the:!Treasury ! will continue to/refund

called/and{matured j
must^e^emem^ {
^bered thai there is! yet nothing official about such; a 'polity. l
robligations with short-term issues and cash,/it

Despite newspaper reports, and rumors, the
"Treasuryshas.said. nothing about the manner

Secretary

Of the

•

!d;Hvlitbh''4tte?r6*/.T.

/;sl|fiindingswill 4>e• bandledly;l:l/$/:/Sl@^^
Bankers and/insurance companyvexecutives^have- conferred with
Vinson, but they have received nothing that would give any
indication of what the^Setretarylfttdhds to;do about pbstwaf finance
•'

.

„

BUFFALO,

N. Y.

—

combat the

buying

spect

to

their

ing. .. . While the Treasury will no doubt in the near future make
Jmow4he!method;-of handling Ihefrefunding^ the; Go^rimeiit will

statistical

#

blame

reported that Rich!Whitney, former President of
New York Stock Exchange,
who ^served a prison sentence fot*
larceny, will head a newly formed
Florida textile company. The new
; Edward P. Field & Co., 37 Wall
company,- Ramie Mills of Florida, Street, New "York City, members
Inc., has been organized *to grow of the New York Stock Exchange,

Hewj GnHy Joins

Edward P. Reld C«.

and spin
uses.

ramie fiber for

announce

concern, it

nomist.

Mr. Whitney will be

President and director of

with

the; new

is understood.

/

,

that Henry Gully is now
firm as ecor

associated with the

com¬

J.

Mr.

headed his

Gully formerly was

Williston

R.

own

&

Co., and

firm, Henry Gully

/< j

NOT A MEW ISSUE

»

.

$18,000,000
Debt management, of which the refunding program is a part,
should be based on sound economic considerations.,... If a policy of
issuing only short-term obligations is followed,, then it isf^foregone
conclusion that the yield on long-term Governments will decline,
wpich means that the yield on corporates will also decrease.
This
will lead to the purchase of obligations with lower rating
by financial
institutions which ^ could'Mve adverse effectain the Tuture on our

|

>.

\

.

.

Boston and Maine §Ra$roud

.

First

-

Mortgage 4% Bonds, Series RR

economic structure.

Due

Should a program be adopted of offering someintermediate
and long-term obligations in the refunding operation and Federal f

v

continues to sell securities to offset the return 'flow -of.

j;

I

. . . This would have a beneficial effect . on "themuney markets
since it would counteract the inflationary influences, that have>{

j'.*f

|

been causing so much concern.

.

^

.

July 1,1960

currency

and the inflow of gold, interest rates would be increased slightly. ;

!■

Price 103% and Accrued Interest

^

MEANWHILE...

li

What should be the investment policy of institutions under

,

pres-

'ent bond market conditions

? It seems to be the opinion of money
:market experts that until there is definite information on the re¬
funding program from the Treasury, it is advisable for nombanking
[ institutions to adopt a waiting attitude.
As for banks it is the
prevailing opinion that these institutions should confine: their put.

.

MORGAN STANLEY & CO.

MERLE-SMITH

DICK &

.

■

chases to certificates of indebtedness.
at

least

•this,

;'

r>
■

I

'

^

their

.

investment

.

.

Most of the banks have,or

BLYTH &

CO., INC.

KIDDER, PEABODY &
CO.

pretty well set at
itme, so that all they should be concerned about is the invest¬

ment of

|

should have

new

fuiids,...

program
' '.;r;

■'/-•./

WHITING, WEEKS & STUBBS

.

By investing these funds in certificates of indebtedness they

will be in

a

position to

financing program.

.

.

.

take advantage of any change in

the Treasury would affect the Government bond market.




the

1

Any change in the financial policy of
.

.

■v:'#-;:--'

February 8,19$

•'

re¬

set-up.

eventual fiasco.

Ibe -forced 'to issueTower coupon PbligatiOhs if the present trend in

Government bond-prices continues.

utility

the public may again
"Wall
Street"
for
the

Mr.

.;

on

present craze

low-priced

stocks -and warrants without

the

Albert J. mercial

partnership" in; A. J ./Burke & Co.!,
Ellicd'tt Square/Building;
\

for

ard

cess

Burke, Jr. has been admitted to

best to

favorable

Otherwise

the ramie plant, and harvest/pro¬

A. J. Burke Partner

outlook 'seems

■

v

& CO.

THE COMMERCIAL & FINANCIAL CHRONICLE

844

Mirtfc, Inc.—-Brief

Getchell

orandum— L: H.
52 Wall

Dealer-Broker Investment

C-2,j 841 West Washington Blvdi,
7, 111.—$3.00 with privi¬
lege of returning for refund with¬
in fifteen days. ;
Chicago

York

14 Wall Street, New

& Co.,

American Forging and SocketCircular—De

Stock,

Preferred

parity with listed

over

um

Bank

com¬

&

Inc.,
York

dustries.

Roi

American Service Co.—Circular

potentialities for en¬
hancement of values—ask for cir¬

—Adams & Co., 231

South La Salle

Company

stock

sound

a

as

purchase

—

Preferred" Street, Chicago 4, 111. Also avail¬
Also
—Blair F. Claybaugh & Co., 72 able is a recent circular on E. & G. Bishop
Brooke Iron Co.; Michigan Steel gating.
Wall Street, New York 5, N. Y.

available
&

/

Schenley Distillers Corporatioi

running in the Chronicleto Mark Merit, in care o)

write

Distillers

Schenley
350

articles they have

of

Fifth Avenue,

Corporation
New York 1

Company

Sports Products, Inc. <— Memo¬
— Cruttenden
& Co., 209

of

randum

Babcock? York Corru¬

Ideas

Terminals Corp.

Dealers—Discussions,

for

February issue of Marchant
Calculating Machine Co., Hawai¬
ian Pineapple Co., American Ex¬
port Lines, and Gerber Products
Company—Kaiser
&: Co., Russ
Building, San Francisco 4, Calif.

in the

*

Bank of America, N. T. &

S. A.

—Special. study based upon the
Dec. 31, 1945 statement—ButlerHuff Co., 210 West Seventh Street,
Los Angeles 14, Calif.

available

Also

Lehigh Valley Railroad—Circu?
lar—McLaughlin, Reuss & Co., 1
Wall Street, New York 5, N. Y.

South La Salle

report

a

Consolidated
for

Memorandum
dealers—W. T.

Co., 208

&

on

Inc.—

brokers
and
& Co., 120

Bonn

Broadway; New York 5, N. Y.

Street, Chicago 4.

Bowser, Inc. — special study—
U. S. Goodbody & Co., 115 Broadway,
Government Bonds,, by maturity New York City.
-}
Also available
is a
study of
categories; breakdown of sources
of gross income—Laird, Bissell &
Consol. Electric & Gas.
1 leeds, 120 Broadway, New York

of: holdings,

5, N. Y,
1

•:

'

!*

,

>

•

■'

»

''V

-

Yv'r't:*!

•
'

;>

Outlook

In

1946

Ifentz
Hew

York

Also

4, N.

Research Comment

uations

and

Evans Products Co.

and

Review oL Business
Conditions—Hirsch

Financial

&

Co., 25 Broad Street, New York 4,
N.

Y.

Sp-i.

Consolidated
Phe

available

is

circular

a

Mines

Francisco

on

and

Utilities

Gas

Corp.—Circulars—

Chicago

Hicks & Price, 231 South La

iAlso available is a
Oirandum on The

Mexico,

of

Ltd.

Utilities
—

ysis—Ira Haupt & Co., Ill Broad¬
way, New York City. Also avail¬
able is a study of North West
Utilities Co., and New England
Public Service Co.

Midland

and

study-

detailed

M-3—Fred "Wf
Fairman & Co.. 208 South La Salle
for. circular

I

Street, Chicago 4, ;I1L
-.

Salle

Mining Indus¬

ickr,

formerly
Chief ..Valuation
Engineer of the Philippine Bureau
of Mines—Hayden, Stone, .& Co.,
25 Broad Street, New York 4;N. Y.

Mut^r Co^
•:

Iron

,: /
Co.—

possibilities for appreciation' for
company—Ward & Co., 120
Broadway, New York 5, N. Y. Also
this

available
/

are

late memoranda

American

Great

Alabama

Mills,

on;

Douglas

SI

Philippine Gold Shares—Analyv
United

Consolidated, San Mauricio, Bengruc t,
Balatoc,
and
Mindanao
.

.

Mother Lode—F. Bleibtreu &
Inc.. 79 Wall

N.

A.

Masbate

Paracale,

Co.,
Street, New York 5,

Pinna Company—Circu¬

N. y.

Beneficiary—Descrip¬

rcalysis

should

of

company

which

benefit from the automo¬

bile, building, and frozen food in¬
dustries—Raymond &
Co.,
148
State Street, Boston 9, Mass.
Public Utility Bonds and Public

Utility

Preferred
Stocks—New
Edition—comparative statis¬

tical data

on

all major new issues

*Jrqni 19 ~4 to the end of 1945;list¬
ing
310
bond
and1 preferred
stock issues of electric, gas and
telephone

companies—copies

security dealers
ir vest or .3

on

to
and institutional

request—The

current situation and
for- 1946—Comstock &
Co., 231 South. La Salle Street,
Chicago 4/ 111.
;
?

of

New York.

Corporation, 100
way, New York 5, N. Y.

—

Also available

Midland

are

Utilities

V.'all

and

■:

Boston 10, Mass.

,

Oregon Portland

letin

on

Lerner

;

.

;

>

Fibber Industry: An

The

Fash¬

on

Co.—Analysis—
Zippin
&
Company,
Inc.,
208
South La Salle Street, Chicago 4,

Machine.

projects
throughout. the country. ' This is
exclusive of $46,000,000 for floodcontrol work on: the Mississippi

■

La

Salle

111.
American

El wood

Investors L.

—

Inc.

—

Recent

26, Mich.
i
Also
available

report
Sheller Manufacturing Corp.
a

Appraisal

"Fortnightly
ket and Business Survey"—E.
Follutton & Company, 61 Broad-

P.

McEnanyvidied:qw

Flood-control

r

on

in

Glore,

Forgan

\i

■■■*■■"

the

of

?

William

Hoit.

'h

gage

This Is the Road
ket

Success—By George 'Seamans

—A

new

written

edition

to

take

revised

into

the present market
up

to Stock Mar¬

full

and

Cavalier, limited partner in Dean

He

Witter & Co.,

ceased

as

of Jan. 31.

-

Birmingham

to

be construed as

ofan offer to buy,

any

an

was

formerfy

offering ofthis Stockfor saley

or as an

offer to buy,

of such Stock. The offer is made only by means ofthe prospectus,

Nenv Issue

Co.—.

Silver Creek Precision
-

i

(par <value $.40)

Corporation

v

m

^

S3.25

per

share.

County Coal—Anal¬
condition and post-war

prospects—F. H. Roller & Co.
Inc., Ill Broadway, New York 6

Copies of the Prospectus may be o/jfaiued from

the undersigned

N. Y.

General

Box -—Analysis — Cas¬
Co., ..120 South La ; Salle
Street? Chicago 3, 111. Also avail¬
able is a study of Mississippi Glass
Co.

re¬

General Tin Investments, Ltd.—

position right

A

report for dealers only—Ward

to the time ojf going to press—

&

Co.,

Seamans-Blake,

Inc;,

'.

Dept.




i|F.

&

C-l,

5. N. Ys

120 Broadway, New York
W;->-

Tehruary' ft, 104b'

R KI ELY i & lib M
Incorporated

■'

1

1

Keays & Co.

PRICK:

account

'

<

^

Open

in New York City to

Franklin

well

New York 6, N. Y.

f

en¬

in the investment business.

COMMON: STOCK

of

C

82,000 Shares

Analysis—W, J. Banigan & Co., 50
Broadway, New York 4, N. Y.

ysis

,

Omo Hundro will shortly open

offices
late

'

J"

Omo Hundro to

&

Jan. 31.

Interest

Y.,

South Plymouth Reser¬

ihember voir, N. Y., $190,000.

as a

pt-t

partnership

N. Y., $180,000;

GenegantsJ|t/Reseryoii;,,, N.

Malcolm Smith withdrew, from

on

circumstances

Almond

planning—Copes

Corner Reservoir,

which date Borid, Mc- $60,000;

on

"

11

no

solicitation

tion—Memorandum—J. G. White
& Company, Inc.; 37 Wall
Street,
New York 5, N. Y,,

the

masi

a

partner

on

.eport — Mercier,
McDowell &
Dolphyn, Buhl Buildipg, Detroit

49

$900,000;

Y.,

N.

cuse,

Exchange

firm.

Co.

possibilities

;

Enany & Co. retired

Analysis of high leverage common
stock—Sills, Minton & Co., Inc..
209 South La Salle Street, Chir
cago 4, 111.

Rose ^ Troster. 74 Trinity Place,
New York 6, N. Y.

.

(general)—Syra¬

Reservoir, N. Y., $1,100,000; East
Sidney Reservoir, N. Y.; $1,200,-

.

chanses:

Feb. 1, as of

Pacific

■

:

Flood-control

has announced the following firm

Street, Chi¬
;

This is under

a r r e

:'.

•

..

.

.

000; Elmira, N. Y., $540,000; Mount
Morris Reservoir, N. Y., $1,000,000; Buffalo Harbor, N. Y., $12,Weekly Firm Changes
500; Black
Rock Channel and
Tonawanda Harbor, N. Y., $5,000.
The New York Stock Exchange

Co..

&

.

New

New York and

Jersey Channels,. $3,634,0001

10

wry,

62

on

.

New York Stock

i

.

•

■v

Pacific American Investors, Inc(.
South

is

flood-

general

for

work

control

."y-

Electromaster

F

Sugar

;•

Cement—Bul¬

recent developrrfents —
&
Co.,
10
Post Office

—Memorandum—Kitchen
cago, 3,

the

of

lump allotment

largest

$110,814,000

$1,510,000;
Vicana

•

Square, Boston*9,Mass..

135

of

operation

$67,871,500

Among the projects for which
Well- appropriations are < carried are:
Engineering Co.; Kendall Co. Rivers and harbors1—New York,

man

|

Company-f
Descriptive -circular££D a y to h
Haigney & Co., 75 Federal Street

Federal Water & Gas Corpora¬

Street, New York 5, N. Y,.

ir4"-1948—In

for

Gisholt

First

Hickey,

&

and

Maintenance

existing river and harbor projects

ion Park, Shatterproof Glass,

■

Business—

Passenger

rnalysis—Vilas

An

Memo¬

memoranda

^

Ka*!road

$2,235,500 for.advance planning on
20 other projects.

work.

Also detailed circulars

'

interesting
Corporation

randum—Buckley Bros., 1529 Wal¬
nut
Street, Philadelphia 2, Pa.

Broad¬

Boston

ects, the bill provides $42,776,250,
reduction
of $7,803,250 from
budget estimates, in addition to

River and its tributaries.

prospects

Panama Coca Cola—Circular

Eastern

Post War

1946

De

lar—Herrick, Waddell & Co., Inc.,
55 Liberty' Street, New York 5,

Y.

tive

construction

21 river and harbor proj-

For the Panama Canal, the com¬
Descriptive
circular—Seligman, Lubetkin
& mittee recommended $19,801,000,
Co., 41 Broad Street, New York'4. including $2,010,000 for sanitation

Industries;

Inc.;

Shoe and General Tin.

of

continuing

on

Upson Company

111.

recenj; mem?

Malleable

Dayton

try—A report by William F. Boer-

sis

as

For

-

•'.;

/

Study of outlook and speculative
Philippine Gold

if passed would provide
follows:

measure

funds

Utah Power & Light Co.—Anal¬

Street,; Chicago 4, 111.

■

Also

analysis of

New England Lime

th<k>

Railroads—In

for

billion dollars or more. Accord¬

.

]

i

■———r-

Outlook

the company—Scherck,
Richter
Gompany,
Landreth
Building; St. Louis 2, Mo.
affecting

memoran^

special

a

Midland
Realization

Airlines-L alysis

Southern

Bulletin of interesting .news items

several sit¬

on

an

Miller Manufacturing Co.—An¬

Chicago &

bulletin of

a

c!um

tnmrent

70 Pine Street,;

Y.
is

Colket & Co.,
New York 5, N. Y.

study—Penington,

..

report'—Hi
Beaver Street,

available

on

•

Earnings

Detailed

—

&Co., 60

Corporation—Detailed

Chicago
•' Sv* "^r •"'*

.****&$ ?

*1

Railroad

for

which the ultimate cost would be
a

bill's total.

Also available is

Standard Silica Corp.

Writ e

Final approval of the

legislation would carry forward a
long-range program of work al¬
ready authorized in past years, of

accounts

Illinois.
Nineteen New York City Banks

—Breakdown

put
and would

programs

war,

a

Sunshine

analysis—Faroll

is

Koehring Co.

Merchants Distilling Corp.—re-

many years.

work

[11.

cent

the

provide $15,000,000, for work on
the cross-Florida barge canal, a

Chicago 4,

South La Salle Street,

National

and

numerous

on

aside during

ing to the Associated Press report
of the committee's approval the

N. Y.

,

Casting

and

Co.

Transport

Atlantic

—Brochure

specu¬

studies

are

available are circulars on

Also

;

Corporation, 70 Pine Street, New
York 5, N. Y.

cular "ML Convertible

appropriating $300,987,chiefly to river

controversial point in Congress for

Colony

First

6

Feb.

on

498 to be devoted

Sports Products-

of

Study

—

•

approved and
sent to the floor of /the House ' a
mittee

work

•

Gulf

been

Le

•

\
The House Appropriations Com¬

measure

!

^

Votes; |

(B) — De¬
and harbor and flood-control proj¬
scriptive circular—-Hardy & Hardy
ects.
(The bill would finance
11 Broadway, New York 4, N. Y.
Company

Randall

En¬

Standard

,.

,

anal¬

ysis of National Radiator Co.

F.

Aetna

&

Also for dealers only is an

-

du Mont Laboratories

on

Bank

New York 6, N. Y.

way,

gineering and Great American In¬

lative

—embodies

v'.

•,«,

Reilly & Co.,
40
Exchange Place, New
5, N. Y. Also available is a

common

stock of successful company

mon

Allen B,

—Circular—J.

Rapids National
Grand Rapids 2

Grand
Building,
Mich. .-7".^Tornga,

low
price
range—yields
over
4y2%—sells at only slight premi¬

Larson

Young,

"•

-

V"'

circular

5, N. Y.
Convertible

' " ■"

-

N; Y.

including a

Bulletin,

A

River-Harbor Bill

teresting ' situation — Hardy ; &
Hardy, 11 Broadway, New York 4,

firms mentioned will be pleased.-,
interested parties the following literature,
.

special analysis of the Glenn L.
Martin Company—John H. Lewis

Aviation

.

House Committee

National

Public

: Gulf
Atlantic
Transportation
Co.—Detailed circular on an in¬

It is understood that the
to send

l:.vV '

Trust

"Co.—Analysis, for dealers only—C. E. Unterberg & Co., 61 Broad¬

mem¬

& Co.,

Street, New York 5, N. Y.
\

Recommendations and Literature

Rothchild

Thursday, February 14; 1946

*

or as a
■

in

;

Volume 163

Number 4464

!

.

845

■ - : T«, THE COMMERCIAL & FINANCIAL CHRONICLE

r,

■«

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:

...

"

Are Chicago and St. Louis
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Part of America-or Not?
,A'"

i

•&'.

Why should through rail travelers be held
The cities aren't to blame. What

Although

l\ by the
I,'

1 ,c

.''

"
y' t

.

t ^

r

,

knit together

greatest rail system in the world,

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X

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"

A passenger cannot go
St.

are

be done about it?

still strangely backward on one score.

we are
,

,

*

48 states

our

can

at their frontiers?

up

^

-

'• '

4

/

■

-

"" '

•

;

'

•

' 11 ,'V" ' '' V1..

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through Chicago

K' ^

or

Louis, two major' rail centers, without

changing trains. lie must break his trip.

'■f-v.

/v.V:,;;.. y ^'-:

-y .■'■-:<■■

'

.

■}■.■•..■■.■

■;

■■■

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■.'.■■ ' •

;

...
■

■■

■

It is. almost as if he reached the frontier

7>rM

of

some

foreign state whose borders

closed to traffic. There is
at

Chicago

or

no

were

customs barrier

St. Louis, but the traveler must

nevertheless pay an i

exasperating toll—in

delay, inconvenience, and bother.

Half
This is bad

.

\

coast and ride

a

sleeper

through to the other—

without the nuisance of

-packing and trans¬
ferring baggage, making double Pullman res¬
ervations; waiting around for connections.

only

a

worse

for the passenger who

starts

few miles either side of Chicago or

St. Louis—and still must

change trains. For

example, travelers between Fort Wayne and

service. But

down-right mdd at Chicago and St. Louis!

ofoed to take immediate action.

;

can

so

travel

unnecessary! In Canada,

you

This is the

continent, from Montreal

across

Vancouver, by

out (changing

a

choice of two routes with¬

i?:

—

the vast

a

majority

on

short mid-continent

'jf: trips—are forced to make troublesome, timeV wasting
stopovers at Chicago or St, Louis.

No
as

up a

barrier in the

traveler. Such
business

nor

a

way

explanation

are

responsible for
of the through

barrier promotes neither good

not

over,

those who

forced to stop resent the inconvenience

and delay—particularly




in these days of

■■

;

join with

yet

revealed. But the plain fact is

any

combination of other
through Chicago and

practical schedules and routes.

^:yyj:'y:::y}'V'":XfX'\"'XXV--X-V
runs to Chi¬

The Nickel Plate Road,' which

and St. Louis, also stands ready now to
any combination of roads to set up
same kind of connecting service through

cago

join with
the

these two cities.

—

the

y ;

;;

■'

,

■;

•

■f^;-y 0;y jXf

.

-iX

'

'

' *-

' XXXXXXX::

How About Action NOW?

over-

Chesapeake & Ohio and the Nickel Plate

Road

are

not the

with others,

...

^

i

only railroads that,-working

could provide such

'

abolished—in the interest of the traveling

public and the railroads themselves.
h \X'X'f«'

ISfelf;r.
x

]

''

thirough

i

v

r,,

\

W ~

S

Ohio

'
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r

' f

*

the support

railroad people

4 ,v
\

y

;

^

"4..'

"

and railroad investors

transportation.; X

'I
h.t'/ *"

of the public, of
every-

where-^-for this essential improvement in

Chesapeake & Ohio Railway * Nickel Plate Road
Terminal Tower, Cleveland i,

..

Through railroad service cannot be blocked

We invite
The

....

indefinitely." The mysterious frontier must be

-"V'
y

pas¬

connecting transcontinental

unsolved mystery —a secret

an

public is not getting through service!

good will for the community.

automatically stop

to

;;X/X.

through New York, Washington,

It remains

record

terminus is Cincinnati, stands ready

St. Louis, on

connecting rail service

For, while travelers with business to transact would

gone on

.>

i

and intermediate service

Memphis and New Orleans, for that matter)
there is

have

i

.

.y.yyyy,.',...yy.{yy.

The cities.themselves are not

no

we

.

-J

railroads to set up

Mystery!

has given an adequate

-

i:

senger

Kansas City, and other big rail centers.

■■

setting

one

to WHY there is

ir

r

Chesapeake & Ohio, whose western

through Chicago and St. Louis (or through
as

Why should this be so?

t,\

now

An Unsolved

million passengers a year

th

.'-y.V.

trains. Canada isn't split down

the middle. Why should we be?

Moines, must also break their journeys.
More than half

•

proposal

making:

as
,

to

v/s are

X

,

And it is

Milwaukee, and between Cleveland and Des
.

the only roads that have

crowded restaurants and cabs. It makes them

''-X"''

■".•.'A

But it is

V -w

enough for the transcontinental

traveler who would like to board
on one

*

Million Victinis!

a

rail

THE COMMERCIAL &

846

plant

a

tions

FINANCIAL CHRONICLE

working

because

better'across the

are

condi¬ backlog
street/ to 27%.

the

employer's brain cells, rather
than
his
adrenals, are set:j to
work.
i
.

Mutual Funds

.

,

.

.

"The reward for

Thursday, February .14, 1946
increased from

was

21%

The Trustees commented

this

of

crease

change as follows:! "This
shift in balance, placing the Fund
in a more conservative position,

an

reflects

stone

on

cautious

more

than

more

outstanding

shares

.

J..-:V^:In Requiem

part in view year-end amounted to
of thes substantial and long-sus-- $160,000,000.
tained advance in security prices."
Note to Dealers
An unusual feature of the re¬

Salesman is

ment-

policy

invest¬

'Custodian

Funds

our

on

fund,'

share from $22.72 to $28.59. r ;
Total net assets of the 10 Key-;

530,669

'/.

*.

the

per

intelligent ef¬
fort by all in an atmosphere of
good will is a vigorous and wealthy
nation.
The penalty for failure is
the; false glory of. inflation."

a

in the

62%

of

increase in the net asset value ;

the-

at

than!

more

i

J. Lord, co-founder
j ,
and guiding spirit of Lord, Abbett and its affiliated investment com¬
The
Securities
&
Exchange;
port-a pagfc -devoted to the in¬
Oxford
panies, came as a severe shock to all of us in the mutual fund field Incorporated Investors
vestment dealers who participate Commission's
Company
whose good fortune it was to .know "Andy.";';
Net assets of Incorpor?te$
#*#####
in y the distribution of
Putnam decision;; has undoubtedly caused
We had planned to review in this column Mr. Lord s recent arti¬
vestors increased from $57,235,622 Fund
a great ;deal of confusion
among ;
shares.; We quote in - part!
cle in "The Economist,"
"A Challenge tc America. ... Get to at the beginning of liko to $83,dealers as to their own position in
"Today's ^successful investment
Work!" With his passing, we quote
The

untimely death this week of Andrew

.

'

■

•

tribute
to his fearless thinking at a vitally
important point in our national

the following passages as a

STEEL

history.

before,

as never

monied. nation.

which calls for
ness

fact

a

of smug¬

sense

On

self-adulation.

or

we are

is

This

no

the

contrary, it is a rousing challenge
to America to get

to work—to get
producing, ^and planning
for maximum .production at the
earliest possible date.*; '
'
i"We are a monied nation, to be
sure, but we must learn that there
be

can

tween

World of difference

a

money

,

and

than

money

on

; year.

portfolio

securities

amounted

$32,662,912, equivalent to $11.90
per share.
/
,

fee^

have

we

the

to

We.

wealth.

of

than

more

a

salesman

value

posite Average similarly adjusted.
At the year-end unrealized profits

to work

have more

the{, end

at

asset

per
share in¬ —he's an experienced and qual¬
creased
from
$23.71
to
$30.44 ified Vadyisfer ' wKb looks at Tils
Adding back all dividends paid
work \in a truly professional man¬
including $3 per share from net ner. He is Celling advice as well
profits realized during the year, is securities, and he knows that
the "per share net asset value of
lisvowri personal success over the
Incorporated Investors increased -/ears depends on how good a
44.6% compared with an increase
job he does for you—the investor.
of 32.3% for the Dow-Jones Com¬
"The guidance of a good invest¬

{/;### r!

■

"Today,
a

Net

had before, but less wealth
than we have had in al long-time..
ever

In

.

his

letter

to

stockholders,

William A.

Parker, President, an¬
policy of seek¬
ing capital gains continues.
It is
believed to be of particular im¬
nounced that "the

portance in endeavoring to main¬
"Activity ] alone is not enough,
tain
and; increase
purchasing'
A PROSPECTUS ON REQUEST FROM
because activity In itself does not
power in a
period of .probable
YOUR INVESTMENT DEALER OR '
necessarily produce , wealth. Dur-'
rising prices for goods and serv¬
ing the late thirties, activity was
Distributors Group, Incorporated
ices.!# "" accomplished through leaf-raking
<53 Wall Street
New York5,N. Y#
"It is recognized that from time(
and boondoggling, but little pro¬
v-v,•
-

the

production.
The whole economic progress of
the world has consisted of getting
more
production with the same
labor, or less. In this country we

COMMONWEALTH
INVESTMENT

em- •

full

COMPANY

economic

labor and fo

Diversified Investment Fund

|

Prospectus

on

mind

that

r

moves

ices

Building

to

these

the

results

ago,

'

•

organization 'eight
the George Putnam

'

goods land

serv¬

maximum number of

in net assets during, the year from
$11,181,000 to $16,161,000. Of this
gain, slightly over $3,200 000 re¬
sulted from the investment pf new

people..,
\
# 'Labor unions, with, their pres¬
ent" powerj can place the hand of hidney in the shares.
\
stagnation on enterprise.
When
During the year the common
»

l"One

years

its

>

of the

one

in

.thousand

a

strike

men

leave^ a plant

stock portion of the Fund

was

re*-

over

working condi¬ dueed from 59 % to 45 % of the
tions, the employer's self-respect: total, ; The; dependable fixed ;ih-and
fighting courage are chal¬ come portion was increased from

NMioim

lenged.! When just

one pian

Securities Series

leaves 20%; to <28% -ond the investment

'

will

give him a chance."

"

Wellington Fund.
•The

annual report of

ton Fund
While

Welling¬

to hand this week
included figures On the

came

we

Fundus operations for the year in
our,

column of Jan. 22, there

SECURITIES

the

of

of Jan.

Fund's

assets

1945, June 30,

1,

1945

gradual shift into more conserva-;
tive

,types of investments.

:

■

120 BROADWAY

ff I

-

in Retail Trade

Current

Securities^;

Information

folder

>. Keystone Co.—Feb¬
Current Data folder oh

Keystone Custodian Funds: Janu¬
ary ISsue
vestor^
X

The

of

•

reduced from 55%

from

increased

Bonds

Stock

Fund, Inc.—K
dividend of 10^ per share payable
Feb. .21/ 1946 to shareholders
c|f
Investors

.

record Jan. 31.

The

to

47.6%
Df; tbtal "net
assets during
the
year,) while U. S. Government

York Stocks—The

New

9.6%

ing

dividends

1946.

to

Feb;

5; *

to

"payable

stockholders

of

Series

objeCti^i^!!3^r-iund# Agricultural
writes Walter' L. Morgan, ^Presi¬ Automobile
dent, "are—1. to provide a rea¬ Alcohol i&
sonable annual return on your in- Aviation.
,

.04 '
—.0^

———

i

.0^

BankStock.^^^.;

*

investment."

Electrical'^

/

^

,

■ ■

this

investment
on accom¬

in

;

Insurance "Stock

,

y*

;!

' '

.03

B-l

Machinery,
Merchandising

may

be obtained

investment

dealer or

Lord, Abbett
New York

Co.

.0^

Metals

07
•

The

50

Keystone Company
of Boston

Congress Street, Boston 9, Mass.




.04

Public. Utility .-» ..■; .J.
Railroad——L—.0$

•

■

Chicago

•

Philadelphia

Keystone KJ2

/

during 1945.; in¬
♦Includes

creased its net assets from

^DfCORPORATED

Prospectus

,!
.

i

.

.08

$3,030,264 to $4,548,305, reflecting Railroad Equip.
.09
an increase of; more than 48% in
'Steei!:#^:——
.05
the outstanding shares of the Fund Tobacco
and an increase in net asset value Diversified Investment Fund * .20'^
per share from $27!86 to $28.23.
Diversified {Spec. Shares—
.04

•

Los Angeles

527 to

$3,461,$7,061,964, reflecting an in¬

.05

from

securities

profits.

|

iNVf 5IORS MUTUAL, INC
-

A-'

Prospectuses

local

*0?

^

■Oil

keystone Fund

During 1945

.04-?

--i

-

Government Bonds !

.

.

'_-y

Equip.

re-

INVESTORS STOCK FUND, INC

your

■

.07

—_

appreciation in advancing JBuilding Supply .2—'—. J .0^
markets without undue specula¬ Business
Equip.
' .01
tion; 3. to conserve the -value of Chemical/.
.0J
secure

INVESTORS SELECTIVE FUND, INC

Prospectus

.0$

-——-

——-

fX

\

Per
share

4#Th^;

l^ment#payable 'quarterly!

2^/

record

'

'

'

froM

follow¬

Feb.

••

17.2%.

mtrnmmmmmmm

I

In'-

Keystone

Lord, Abbett--^Com-

.

SHARES OF CAPITAL STOCK OF

.

forr

January.
ruary

stock portion of the "Fund

common

was,

increased its total net assets from

•

:

Timing discussing "The Ad^

are

and the end of the year, reveal a

•

i

RESEARCH CORPORATION

InVes^-;

ment

•

r*

Vrospectus upon request from
| your investment dealer or

NATlbNAI

Mutual Fund Literature

posite Nummary folder for Febrdfeatures of this report* de^ ary on the Lord, Abbett group of
serving particular attention. The investment companies.
.
|
charts,
"How Your Wellington
Dividends
Xtallars are^h^ted,'!^showing the

plishment."'

/f

Priced at Market

Exj-

some.',

management' is based'

1

& !

February on -National sponsored;
funds; : portfolio,
memorandum
ihowing changes in National spon¬
sored funds during "the month of

and K-2
"

■

Securities

friend. He can help you build a
sound financial program if you

Keystone Custodian Funds B-l
—

the

person give him your confidence
and deal with him openly as a

jsbrf—"Prestige

Shares

:

from

vance

We1 like the keynote of

BOND SERIES:

;

through the years'

Anfl when, you find such

adviser.

your

<

ter

a

as

Since

however, the position of the deal- 3
er is clear.
He acts as principal.
This point is confirmed in a let¬

tha^ as a client you will

breakdown

great."

in / a. Fund has achieved a remarkably
mighty flow of useful goods and steady growth record. The annual
services, with a price structure report for 1945 reveals an increase

!##

San Francisco 4, California

power so

George Putnam" Fund

living.

productive—that

NORTH AMERICAN SECURITIES tO.
2500 Rust

of

financial eminence

the reservoir of accumulated

purchasing

"We must haye activity that is

Request

fk
GENERAL DISTRIBUTORS

and

average

our

standards

; V

the

working hours, while building up
production and improving our

with Redeemable Shares

i

reduce

and

perhaps never equalled can fail to
enjoy prosperity while the pentup demand for goods is so vast

have been able to eliminate child
A

-price of common stocks, but

it is difficult to believe that the
nation : which
has
achieved* an

fund

mutual

National Securities & Researc
a marl br ^omah v who
will "become a trusted friend "and 'Gofp.^-Current issue of

to time there will be declines in

"We must not confuse full

;

as:the offering of
shares is concerned,

tnd^select

.

ployment: with

far

So

1

m

deal with him

...

duction resulted. V .v

offering of securities to cusi-

tomers.

change Commission to Mr. John
M. Sheffey of the National AssoU
ciation of Investment Companie!s
under date of Feb, 1, 1946.
For a
ment man is the best aid the in¬
vestor can have in these changing copy of the letter we suggest yoii
write to Mr. Bheffey at 61 Broadltimes.
Pick him as you would
way, New York.'
your doctor or your lawyer. Keep

■

'

the

.

; your

may

or

'

j

J

#

"

PARKER

CORPORATION

ONE COURT STREET. BOSTON 8,

MASS.?#:

k. E. Macgregor, President ,V

!

,

Minneapolis, Minnesota
^

THE

request from Principal Underwriter

INVESTORS SYNDICATE

be obtained from

local investment dealer,

on

.7 "?•

r

REPRESENTATIVES IN

,*

et,

THE

-

V'1 ?, fe' '*■$

PRINCIPAL

CITIES

e
OF

I'v%'

THE

UNITED

STATES

Volume 163 & Number 4464

THE COMMERCIAL & FINANCIAL CHRONICLE

t
>

3-year debentures at an interest
cost, of barely. 2^50 % to the; bor •£
rower

and bankers reoffered the

issue

at

108^

to

bids to

be opened "next' Monday
$50,000,000 additional;of series.!

F first mortgage,

bonds to mature
This time to refund
a like
amount of series* C 3 3As
sold early last fall. It will be in¬
in

Unless,

50

tors, will reach for this

years.

;

Five

cumulative

new

Milling Machine Co. has regis¬
230,000 shares of $10 par
common, of which 113,113 is for

pre¬

tered

Alabama

one.

Power

Co.

has

filed

300,000 shares of $100 par, 4.20%
preferred to be exchanged for
outstanding $7, $6 and $5 preferreds.
Any unexchanged bal¬

New Issues in Sight

•

of

ferred.

yield about

2.47% to maturity. .)
"Now Southern Pacific is asking
on

shares

teresting to see how far bankers,
Who ^reflect the temper of inves¬

847

holders
new

and

does

not

represent

stock.

1

-

,

Merck & Co. Inc. brings up the
companies have gone
into registration on projected new
finish for the mopnent with regis¬
issues, most of them equities. ances presumably Will be under¬ tration covering 120,000 shares of
•
Scranton - Spring
Brook Water written.
/
preferred and 118,000 shares of
.Service Co, plans the sale of $23,Of the latter
Cherry-Burr ell Co. has filed for common,
18,000
500,000 of new first mortgage 40,000 shares of new $100 cumula¬ shares is for the account of pres¬
bonds,
due; 1976,
and
100,000 tive preferred, while Cincinnati ent holders.
;

more

,

,

unlikely,

as now appears

the Treasury* yields to urgings to

revise its monetary theories, there;

strong indication that

is

be in for another

of

run

ref undings. ~

<

we

ago,

short

a

industry
WM

had just about reached the ulti¬

costs

of

its

refinancing at
"the
general

changed

debts

lower

■

:-;'Y

Vital in

the

through

of

coupons,

situation

decidedly

:■

SSii

mate in paring down the carry¬

ing

has

Certainly the
the

rank

manner

and

file

who

refunded

have

earlier

keeping

the cost of carrying'the

purity of the ballot is the need

freedoms of

our

assemblage and

press,

for

means

.

expression

re¬

of

public attitudes

the nation
-

r™

o

e

old

are

as

itself:
*

.

ree

the market place. This Ex-

,

encaneec ion

change recognizes its responsibility. -No artificial influences

do win;

2—The free American market

national

debt, hut there is much talk of
; the stimulating influence of low
vinoney rates on the general

rru

keep its costs down,

the Treasury

persists in borrow¬

short-term

on

attractive

o

,i

only

apprehensions regarding

thus

forcing

interest

the

relentlessly downward.

surprise would he, of
^ course, if corporate borrowers
were to let' pass the opportunity
to do some more shaving of

mism expressed here daily in

>.

Y

Consolidated Edison

'

A

,

Truly, the voice of the people

is

speaks more clearly and force*
if

*

^

"straw-in-the-wind"

At f":

the

action of Consolidated Edison Co.

Both channels of

of New York in calling a special

meeting

of

its

shareholders

pression

to

new

democratic system. Both your

and

neighborhood voting place

i

and the New York Stock Ex-

ity, in his letter calling the
meeting,
stated
plainly
that
is a preliminary step to
»refunding the long term debt of
the

some
;
•

11

which

total

As

things

now

stand,

confident

are

^

J

'

-

.

'

•

v

.

thbir

*\H'

'

be

can

since thp turn of the month shows

the wind is

way

:

Hardly

of

a

was

week
able

$50,000,000 of

ago

to

sell

wlv

t

p t,

«

And

new;

an

bonds

2%%' coupon

at

100.6599,

reoffering the

| L *1

V /r

r

v

,^ ^

I

That

ma-

jority is always right', either
at the voting place or on the
market place, That is another

^

as a

wrong.

oft-repeated

question,

"What did the market do today?" is Just another way of
asking, "What did the people
think today?"

thermometer is
tem-

not create it—the
and

on

the

market- quotations both give

"What is Wall Street saying?"
c&n

Southern

measure of

the

properly be interpreted as

"What is Main Street doing?
-

r.

■

■

%

-

:

issue
ma¬
.V

turing in 40 years and carrying
tankers

i

opinions of the majority, while

blowing.
Pacific

the

accurate

.

^learlygwhich

ji,

pretends that the

election returns

issue market

new

|

save

the'market place,
alone among aU the forums of
Public expression, the people
back their opinions with their
dollars.

one

perature,

the fact that what has been hap¬

pening in the

J

i

of expression,

polling place.

expected to record the

sidestepping

no

^

But, just

V.'

Setting the Stage
There

one

privilege of being

is

ability to refinance the - debt at
'»

both, the

of democracy's freedoms—the

i
(:-:3

substantial savings.
"Z«

^

No

company

of

means

on

that prevails.

callable, is about 3.37 %.v

officials

tered at the moment is the

;
*

mortgage bond issues

of-the

markets of the country than
through , any other single

opinion;., and

put out by predecessor companics aggregating $323,151,000.
The average interest rate on 304
millions

■

majority opinion being regis-

and the

possible
issue of additional bonds."
i The company has outstanding
three series of debentures and

i

1

fully through this Exchange
and the other organized

ing grounds for all shades of

-

company

f-0
^■*

change provide common meet-

:

""this

ex¬

to the

a

The President of. the big util- ;

v

public

are necessary

property

authorize the execution of

piortgage on its
franchisee*"

fall of prices is the

or

,.n

tion persists for any appreciable
length of time.

.

unsur.

s4tness.

Thus, the optimism and pessithe rise

i

de^e6 0f gelf.
lati<m

viewpoint of the public^.;
ll'llvluncolored by other influences.

\\ ill .j>;-j

^\\'W

a

eco¬

M

.

their Interest costs if the situa-

ed

^ in

questions that affect
national welfare. ■

The

maintain

im

nomic

credit,

gates

;

we

speak their hopes and their

Which in turn swells the volume

'

public opinion. To that end,

related to

of

;

on

goyernmen ;
through the latter, thepeope

and

banks

to

issues

which is

paper

must affect prices and thereby
distort the dear expression of

•

of the people is heard

business picture.

ing

1,1

trough the former, the voice

In order to

e:

the integrity of

Indeed, the two most funda-

The Treasury still adheres to
the idea that cheap money is
essential.
Fundamentally it ; is
with

for preserving

mental

minders in the last few months.

concerned

Second only to preserving the

worship.

companies

- many;

making no attempt to sit in
judgment on the correctness
of those opinions.

public opinion.

speech,

debt

their

of

by

all

are

guarding

top-grade
corporates have been crowding
the Treasury's issues in the open
market could prove conducive to
reconsideration

democracy

for clear expression

in which

of

structures

a

means

That is why so much of our
basic law is dedicated to safe-

the

since

turn of the year.
,

<

corporate

though

as

V;:

'

•

.

Though it looked, only
time

,'s1

may ,

a

■

New York Stock Exchange

-■'i'ri-

with

issue

at

101V2 to yield 2.81%.
The next

day

sold;$44,493,000

Union Pacific
of

new




2Vs%
■

IK.

„»f

•

S .'41

Xi

i' «rs '•.*

m

'•£

'im

/'* !" '"T "

THE COMMERCIAL & FINANCIAL CHRONICLE

848

V

•

i

•

-

"

•

••

r

***.

,

^

"

i

\

>

k

'

<

,

Good and the Bad in

i,

•

Bank and Insurance Stocks
has just been received.
In the "President's Let¬
to the Stockholders," Mr. W. Ross McCain comments on the

Insurance Company
ter

to be ' interstate

decision, which declared insurance

Supreme Court

commerce," and hence subject to the anti-monopoly laws, as follows:
; ^
"During the past year much progress has been made in revamp¬
ing the rules, rates, and practicesin a straitjacket. If the free enter¬
of the fire and casualty insurance
companies to comply with the prise system is to be allowed to
"Changed conditions brought about continue, the insurance business
will find a reasonable solution."
by the Supreme Court decision in
The
Aetna
Insurance
"fleet"
the
South-Eastern Underwriters
the
following
com¬
Association case.
The companies comprises

rapidly recovering from the
confusion and shock of this
fundamental change in the method

panies: Aetna Insurance Co., Cen¬
tury
Indemnity
Co., Piedmont
Fire Insurance Co., Standard In¬

by which the business has been sq;
successfully operated. £ They are

surance

are

first

Standard Surety &
Casualty Co., and World Fire &
Co.,

Marine Insurance Co.

cooperating with the states
revamping laws which are
workable and practical and which
now

to the states the super¬
vising of the insurance business,
but laws sufficiently flexible to
avoid the putting of the business
preserve

•

report, pre¬
in 1945
1944 for all

in

than

higher

'

written

business

mium
was

the

to

According

in

companies except Standard Insur¬
ance Co. of New York, as shown
the tabulation below:—

in

Net Premiums

Company—
Fire &

World

Insurance..

York

Standard Insurance Co. of New
»

p

w

v

^*"0

,

2,901,038
2,598,831

Marine Insurance-

Fire

Piedmont

'

J' /

,

•

Standard Surety &

Total

Casualty

Total, .6

It

.

*—

Group—

...,

the

parent company, is approxi¬
mately 50% greater than the com¬

$5,507,681

10.7%

,9.2%

1944, as the fol¬
lowing comparative figures indi¬
in earnings over

of the other five

business

cate:—

;

L-

—

—

$1,555,393

-

5

underwriting -loss .or profit—.—-

investment In come——„ _——.

1,745,175

(rotai

.

net

operating profits

2-

(before taxes) —

$1,523,289

$142,533

+

'

—$221,886

Net adjusted'
Net

$1,272,108
1,414,641

-

1,333,507

equity—-,——

reserve

net

operating

$1,973,160

,

69,757

$1,455,682

taxes)

(after

profits

,

$1,903,413

¥r;

$1.04

I-——,.—m

(750,000)——-—v—

share

.,

^ ,

^

$3.54

Surplus, unearned premium reserves and liquidating value of the
1945, are each substantially above 1944
year-end values.
~
.

J

Dnearned

premium reserve—

Conflagration reserve
Surplus

—.—!.————

weeks

fits

were

and

com-

from

manner, a
strike .arising out of
such dispute."
He can make this

would

be quick to agree, I am
with this general proposition,
based on their experience on: the

order

sure,

time up to but not

Board.

Board took the

8.1

stituted

view

vorable

for

Phenix

-

reported

such relatively fa¬

of

for

results

these

three

the

title

Provisions",
matters

f

by maturity categories
,

the

binding effect and
enforcement of collective bargain¬
ing contracts on companies and
unions, violence and intimidation
as

in labor

disputes, the removal of
employees from the
of the Wagner Act,

on

,

another

There's

virtue

in

the

It stresses meditation rather

bill.

than fact-finding as

proposed by

the President. The facts in

controversy

Everyone
much
the

the

the

a

labor

seldom in dispute.
involved
knows
how
union is asking, what
are

employer is offering to

pay, the rates the workers

are re¬

ceiving, what others in the indus¬
so forth.
*
What the parties can't agree on
and boycotts to compel an em¬
is how much of an increase, if
ployer or another person to deal
with or use the members of any any, should be granted.
A good mediator can frequently
labor .organization.
: >, •
bring the parties to a common un¬
1 ■: For reasons of space as well as
derstanding. Accordingly, the bill
because the first part of the bill
gives the mediators a free hand
is directly germane to the prob¬
to handle each case in whatever
lem of labor disputes with which
way they think will be most effec¬
we are now
plagued, this article tive in
ending the dispute.
And
will he confined to that part of
this is as it should
supervisory
jurisdiction

try are paying, and

be. The Presi¬

the bill.

The bill provides that the Labor
Management Mediation Board to

number

of

representatives of in¬
dustry, labor, and the public*
That's definitely on the credit side
of the ledger. - The War Labor
Board

tripartite agency and
its three way composition added
much to its strength.
No matter
how well informed a public rep¬
resentative may be, he cannot pos¬
was

a

well rounded

same,

consideration to labor disputes by
himself or with others of similar

background
to

and.

experience

as

quote Standard & Poor's opin¬
as published in their Insur¬

ion,
as

bulletin, dated Feb. 1, 1946,

follows:—-

-

'

.

Aetna Insurance Co.:. "Although

returning only
the capital

of

the

moderate yield,
a measure of

a

stock has

semi-investment

appeal

satisfactory

in

view

longer-term

dent's proposal, oh the other hand,

provides for a formal hearing with
subpoena powers for the fact¬
finders, resembling a trial in a
court of law. Most people familiar
with settling labor disputes will
tell you that formal proceedings
frequently add to the difficulties
of bringing a dispute to a con¬
When we. get into

the guts of
bill, however, the debit side
of the ledger moves into prom¬
the

inence.
First of all, the bill

applies, at
potentially, to all employers
in this country with 250 or more
employes. As originally proposed,
that number was 50 employees*
But even as amended, it still cov¬
ers a lot of territory.
There is,
however, a limitation on jurisdic¬
tion, and here's how it would
least

work:

calling

or

any

assisting

or

effective for

Whenever

with 250

a

union at

employees

strike,
notice

it

want¬

have

to

Labor-Man¬

Mediation

agement

company

would
the

on

a

or more

Board

and

which the

on

case.

court order is

subject to review in
Courts and on up to

the Circuit

the SupremeXpbrt+And th&' CoUtt:
order

can't

Board's 30

extend
beyond the
day period of jurisdic¬

tion.
The bill goes on to say
of the Board

Compel

individual

any

without his consent.

Stock Exchange

work

Thus he can

stop a union officer from leading
a strike but can't prevent the em¬
ployes from striking. The point of
the: exemptidn for individual
workers is obvious.No law

com¬

pelling anyone to work against his
will
would
be
legal; it would
amount to "irivdluntary servitude"
which is banned by the Constitu¬
tion.

.

.

•

.

Here's what all of this adds up

to:
If the Chairman does not issue
order

an

against any leader call¬
strike on the day the Board

a

takes jurisidiction, there is noth¬
ing to prevent. the union from

striking. If he does issue an order,
it applies only against the Individ*
ual named, and any other official
of the union, and there are many,
lead the strike. ; Besides, it Is

can

not enforceable until

a

court order

is obtained, and by that >,time the
strike, can be well under way.
,

Of

the

course

union

official

could not take any further part in

heading the strike, but the dam¬
would have been done. What's
more,
the language of the bill
might be construed so that this
particular union official could not
his good offices to get the
strike settled after the court had
issued an order against him.
use

the

of

com¬

Continental Insurance Co.: "The

capital stock is reasonably priced
in

relation to the

1945

year-end

stockholders'

company

Fidelity-Phenix Fire Insurance
"The

generally

yield

favorable

prospects
provide

the

and

the

no

capital

kave

voice in this matter) would be

required to determine whether the

dispute is

one

obstructs

equity of $65.20 per share."
Co.:

dustry and labor members

or

state

or

official

foreign

lead

them.

our

Incorporated by Royal Charter 1727
itvV' /*

expeditiously adjusted by

HEAD

collective bargaining".

Branches

*

^

'

J'..'"*

* '-V

i

'

OFFICE—Edinburgh
throughout Scotland

If they make such a determina¬

over

LONDON OFFICES:

■V.33 Bishopsgate, E. C. 2

the dispute and is then re¬

compared

available.

else)

;v

81VestSmithfielJ,E.C 1

diction, the Chairman (and no one

companies,

;

Royal Bank of Scotland

commerce and af¬

quired to try to settle it.
Once the Board has such juris¬

surance

to

from

which "substantially

tion, the Board has jurisdiction

operating results of other in¬

that

interferes with inter¬

fects .the public interest and can¬
not be

not

We
experience
during the war, with the Smith-

know

49 Charing Cross,
^

S. W\ I

..Burlington Gardens, W, I£

has authority, although he

:

64 New Bond Street, IV, I

Exchange
and other leading exchanges

Kaiser-Frazer

7-3500

1

Teletype—NY 1-1248-49

Gtbbs,.Manager Trading Department)

1 NEW YORK 5

WALL ST.
*

.Telephone DIgby 4-2525

+

Corporation

Associated
Williams

;

Common Stock

Bought

♦

MA

PRIMARY

•

Banksii^L>V5

Deacon's

Bank,

Ltd.

Glyn Mills & Co.

Sold ♦ Quoted

Prospectus available upon request

INSURANCE STOCKS
and

BANK

,

£115,681,681

Members New York Stock
,

A

cannot

to

Request

Telephone: BArclay

'L

that the

Chairman

It is a little naive
During this 5 day period, the
to; believe,
Chairman, Vice - Chairman, and moreover, that .you can-prevent
Secretary of the Board (the .in¬ strikes simply by ordering a union

position

with 1944, as the figures become

Bought—Sold—Quoted

120 BROADWAY, NEW YORK 5, N. Y.
BeU

any

any period of
longer than 30

TOTAL ASSETS
York

in

But t'::i5 order is not self-enforc¬
ing. 7 In other words, there's no
sting to it.
To make it legally
binding, the Attorney General has
to go to court for an order
backing
up the Chairman's order and the

Laird, Bisseli & Meeds
Members New

per¬

and desist

cease

age

ed- to
serve

"requiring

refrain

days from the date

ing

clusion.

\

to

then wait five day$.

1945

Co.

2 Breakdown of Sources

Circular

with such diverse

This column expects to present

.

OF GROSS INCOME

appropriate

most

a

tion."

Manufacturing

?

"Miscellaneous

stock with above average attrac¬

Russell

Holdings

of

It deals

name.

good

19 N.Y. CITY BANKS
Breakdown of

,

The second part of the bill goes
under

longer-term

U. S. GOV'T BONDS

but

agreement,

machinery to pro¬
mote peaceful settlement of dis¬
putes should be improved."

parent

companies it may be of interest

j

free

governmental

pany."

$3.33 compared with $3.12.
In

"Govern¬

order

an

financial

reported at $3.17 per
with $2.82 in 1944,

Fidelity

it, to is¬

members of the War Labor Board,
as
well as its public members,

proposition:

decision should not be sub¬

sue
son

earnings 'outlook and the strong

share compared

pared with 1944 figures. Both of
these companies showed improved
earnings, despite the exceptionally
high fire losses of last year. Con-

doesn't have to exercise

| AH of the industry and labor

ment

tinental's total net operating pro¬

column

Insurance,

14.8

7,500,000
$66.20

«-+•

,

20.0

49,647,818

$61.24

^

presented the 1945 operating re¬
sults of Continental Insurance and
Fidelity-Phenix

:

45,928,767

this

ago

12.7%

7,500,000

——

Liquidating value —
Liquidating value per share

Two

22,290,261

—————

».

Capital

-

—

—.

Increase

$31,382,867
6,000,000
23,594,671

$27,846,264
5,000,000
* nnft nnft

—_———-

31, 1945

Dec.

Dec. 31,1944

Item—

its

creates is introduced with this in¬

.

parent company, as of Dec. 31,
.

as

disputable

ance
Total

has

also

try and labor,
members representatives of indus-

1,830,627

67,607

—

Per

that

"fact-finding"
Congress. The machinery it

sibly give the

1945

1944

Statutory underwriting, loss
Premium

his

be created to settle labor disputes
should .be composed of an equal

13 3

540,763
$1,440,176

$60,076,559 *

9.6

operating report of Aetna
Insurance < Company
for
1945
shows a substantial improvement

the

companies,'

.8.7%

$4,067,505
899,413

The

an¬

done by

nual volume of business

bined

..'1' ' ;;

$13,455,077

•——~—

that

66,904
219,460

4,080,576

Casualty of New York—_

noted

be

'"

—.

companies——:—

will

,v

$46,621,482

~—,

Indemnity

Century

'■*

-

•

—314,668

4,669,541

;
\(J

«,

Total Fire Group

11.2%
vr:
2.3
'
8.4.
—6.7

$4,095,809

$36,452,072

—-

send

Pending Case Anti-Strike Bill

body

a

can

.

—Increase Over 1944—■

Written 1945

Aetna :: Insurance

to

oill to

twenty-seventh annual report of the Aetna

hundred and

one

dent

DEUSEN

By E. A. VAN
The

(Continued from page 832)

Thursday, February 14, 1946

NATIONAL BANE

«

of INDIA. LIMITED

First California Company

GEYER & CO.
INCORPORATED

Post

Office Square

HUBBARD 0680

BS-ZCfl

67
1

•

lr

:

Wall Street
.

NEW

H

RTFOED, Enterprise 6011
-

..

Bankers to the Government in
Kenya Colony and Uganda
.

Head

Office: 26, Bishopsgate,
;^1'London, E. C.

'

Montgomery Street

650 South

Spring Street

Teletype LA 533 ••'

'

•

}■'

CG'ICS

YORK,

PORTLAND,

/

V

> vU.

iir. India; Barma, Ceylon; Kenya
Colony and Aden and'Zanzibar

A

Subscribed.Capital-£4,000,000
Paid-Up Capital-OOO,000
Reserve

BOSTON, CHICAGO,

Enterprise 7008

Branches

LOS ANGELES 14V

Teletype SF 431-432

FRANKLIN 7838

PROVIDENCE, Enterprise 700H




c'

SAN FRANCISCO 20

S. CaSalte Street

PHILADELPHIA. ST. LOUIS, LOS ANGELES

^

300

CHICAGO 4

1-2875

PRIVATE WIRE SYSTEM CONNECTING:

.

; INVESTMENT SECURITIES

231

WHITEHALL 3-0782

NT

INCORPORATED

*

r

NEW YORK 5

BOSTON 9
to

v'f.- :'r'

"Z".

;

\•'

Between San
OFFICES

Private Wires

conducts
every
description
banking and exchange buninds.« -

IN

PRINCIPAL

CALIFORNIA

CITIES

j

ot

The' Bank

Francisco, Ims Angeles, New York and Chicago

• ■

Fund—^-£2,200,000 ''

Trusteeships

and Executorship

also undertaken

-

Volume 163

Number 4464

THE COMMERCIAL & FINANCIAL CHRONICLE

; ' \

Connolly law which had a some¬
similar provision;- but did
not stop the Mine / Workers from
striking even after GOverftment

849

what

seizure of the coal mines.

Let's turn back

;'

*

NEW YORK LIFE INSURANCE COMPANY

'

,

,

moment to the

a

matter of

jurisdiction. The three
public members, as stated, would
have five days to decide whether
to take any particular case.
They
would have to pass on two ques¬
tions: : (1) "whether interstate or
foreign commerce is involved, and
(2) whether the dispute "Substan¬
tially affects the jpublic interest",

A

101st Annual Statement to its

,

;

.

living policyholders, Payments to : the beneficiaries of
who died, $83,195,951, were the
largest in the Com¬
pany-s; history. Payments to the beneficiaries of policy¬
those

companies with 250 or more
employees.
To say the least, the
Board would have a sizable job

in

jurisdiction, the - Board; would be
giving, in effect, its blessings to a
strike as not affecting the public

„

*

holders who died in the Services amounted

And when it rejects

its hands.

to

to

from

to

*

Holdings of Real Estate

look

at

exclusion

the

the end of the

Life

of

Insurance

in

Force

this

in

Company

the

largest

Policy

*

*

Sales

of New Life

$564,180,100,

an

at the end of the year amounted
to
427,944 policies; The corresponding figures
for; the end oif 1944 were $188,185,417 on 483,338 policies.

*

Insurance in

1945 amounted

increase of $38,380,300
*

*

it

tive I smail
throw

can

strike

tugboat

in¬

*

anceand annuity contracts, totalled
of 1945, reflecting an increase of

- of
workers
metropolis like New

Maybe some of these problems
are fancied, not real.
Maybe not.
I could, go on and. name- a dozen
ihorei;

items;'that| could

*

*

$2,319,748,756

to

than 60 per cent

as

in United States Government bonds aided the

of

judgment, it all adds
old

strike

time.

saying:

Assuredly

*

haste

have

we

trouble; at

in World War

up

makes

the

lot

a

II, helped to hold in check the forces of infla-

funds. The increase

present

during 1945

the sensible

$380,643,935.
"

*

*

•a■>*"

*

'

'

a
v

the Company and will be sent upon request. A list of the
bonds and preferred and guaranteed stocks owned by the
Company is also available. These booklets may be obtained
by ^writing to the. New York Life Insurance Company,
51 Madison Avenue, New York 10, New York.-

Holdings of All Other Bonds and of Stocks, preferred

Undoubtedly there are many
good points in this bill.
On the
law of averages, it couldn't miss.
Remeber,
however,/ .that
the
damage the bad parts can do may
easily outweigh any possible good.
Wouldn't

was

'

*

going to solve the problem unless
the legislation is sound.

for

as of December 31, 1945j
contains additional statistical and other information about

Government

•tion, and provided the safest of in vestments for the Company's

But just to legislate is not

+

^

A More Complete Report,

of the assets. The policy of investing

more

the

#

of December 31,1945. This is

bill.

to

♦

payable in 1946 amount to $38,895,341. The
a mutual
company, and dividends are paid

10 P°''c) holdeis only.

Holdings of United States Government Obligations
amounted

*

New York Life is

"Miscellaneous Provisions" of the

waste.

*

Dividends
*

taking positive steps to meet the
currently available from the highest

quality of investments.

readily

cause
major difficulties. I Others
would be able to spot still more.
And I haven't even touched the

In my

were

Company's program of
realities of the low yields

i

year.

York into utter confusion.

*

Against the Company's Contractual Obli*
further strengthened at the end of 1945. Almost
three-fourths of these reserves were computed at 2h per cent
or lower interest. The interest rate
assumptions reflect the

$3^4^94 at the end.

$242,765,154 during the
The assets exceeded the Company's reserves and other
liabilities by $231,013,622, which amount constitutes the
Company's Surplus Funds held for general contingencies.

r number
a

*

Reserves

gations

*

Assets, held for the protection of the Company's life insur-

than 250 employees,
indicate how a rela¬

to

serves

on

to

1944.

over

*

*

Loans

$166,454r50f

greatest since 1930.

about that at all.
the

year.
*

the history of the Company. The gain
during the year, $334,489,672, was the

amount in

in insurance in force

community where less
than 250 « employees are on the
payroll which would cripple all
other industrial activities, endan¬
ger life and health, andsubstan¬
tially affect the public interest."
The Board.couldn't do anything

more

previous

'

erate size

While

the end of 1945 aggregated

at

totalled

$7,979,193,102 under 3,401,178 policies at the end of 1945,

companies with less than 250 em¬
ployees,
I can easily envision a
strike; at a power plant iu a-mod-

volves

*

$22,898,411. This amount compares with $35,976,144 at

*

interest.
Then

*

$8,361,400

1945, and $19,590,700 since Pearl Harbor.
*

Policyholders

Holdings of First Mortgages on Real Estate amounted
$354,128,970 at the end of 1945. There were 34,211 of
such mortgage loans. During the year the Company made
1,150 new loans of $7,500 or less.

Payments to Policyholders and Beneficiaries aggregated
$192,672,219 in 1945, Of thistotal, $109,476,268 was paid

Just imagine,« in times of labor

unrest like the present, how many
notices the Board would receive

on

Brief Review of the

such securities, but,

largely because of a substantial volume
redemptions and maturities, the holdings decreased by a
net amount of $62,484,613, as compared with tlie end of
the previous year.
of

thing be

Congress to strike out all the

President

provisions of this bill except that

part that calls for a "broad and
comprehensive study" to deter¬
mine

what's

STATEMENT

bring
about lasting industrial peace?
w ■
-'ik

MW*»

1

■".

—

Maj. Sikora Rejoins

December 31, 1915

Cash

T

New

York

office,

$36,675,514.81

(Computed at 3% interest...

.

.

.

Major Sikora entered service in
1941

and

was

commissioned

233,526,062.1
321,921,183.00

1942.

He

remains

He

last

the

with

was

berg,
this

in

the

rank

of

stationed

Germany,
country

in

and

at

active

of

to

.

.

.

.

166,454,501.57

;

....$11,172,924.00

J Henry Milner, formerly associ¬
with

Interest and Rents due and accrued.

/•Deferred;*and uncollected Premiums
Other Assets..

of' infantry, A; U. S., has joined

Trust Co., St;

Louis, Mo.

He will

connected with the municipal

"

.

)

^

$51^384,812.00

23,189,388.9;

(net); i;"A'iv

urn

are

paid in advance.

31,554,274.13

.

..

Foreign

Currencies*

v;; y

4,200,000.00

.,.;

Estimated

amount

due

or

21,925,663.76

accrued for Taxes,;.

7,141,412.99

:■

1,276,071.20

3,658,759.15

.

TOTAL LIABILITIES

$5,582^?0i472;32;

Surplus Funds held for general
contingencies
.... i.

231,013,622.311
Wm
$3,813,504,094.63

$3,813,501,094.63

;

statement,

deposited with Government

required by law..

32,031,975.7?

-

,

p.J

-

Of the Securities listed in the above
as

38,895,341.00

Miscellaneous Liabilities,...

9,619,719.03

Properties

Smithy Barney 2 & Co.,

payable during 1946.

1,557,520.27

recently a second lieutenant

the Mercantile-Commerce Bank &

22,898,411.27

Other Foreclosed

Mercanlile-Gommerce

181,187,718.29

.

Reserve for other^^ Insurance Liabilities,

Properties under

Qjntract of Sale

Henry Milner Joins

310,610,004,00

Premiums

,.

548,247.97

.

on

354,128,970.11

.

Other Home Office
.

due

Dividends

Reserve for fluctuations in

Properties.

be

.

. .

Home OlTice.

this

Foreclosed

ated

Real Estate.

on

Real Estate:

year.

and

Company

preferred and guaranteed

Mortgages

$2,983,317,299.00

2,198,600,957.00/

Heserve for Dividends left with the

81,502,607.00

Policy Loans

Nurem¬

returned

January

First

Major.

(

or

Supplementary Contracts

74,501,511.00

in

Slocks,
reserve

Utility.

Industrial and Miscellaneous

$784,716,312,001

Present value of amounts not yet

3,092,346,651.00

Public
-

■

lower interest.

33,511,137.00

Railroad...

r

Computed at 2%%

109,129,002.00

.

Municipal

way.

':T;~

: :>

«

$2,319,718,756.00

Canadian

Broad¬

Reserve for Insurance and Annuity Contracts:

;:;

Obligations

Sikora

29

in hanks

United States Government)

has rejoined their organization in
the

or

Boiuis:

Wm. J. Mericka & Co., Inc., an¬

Major A. A.

haml

:./vV:-v;nv:

;

•

•

on

LIABILITIES

ass

.,

■•

Wm. J. Mericka & Go.
that

CONDITION

&

mmmuru

nounces

OF

to

necessary

Securities valued
or

at-

State authorities

*ThiS Reserve is held
currency

chiefly against the difference between Canadian

Assets and Liabilities.^

•

" T "

;

bbnd ^e^^eht ip the New York

The

Company $tarte(Lbudiu&$

correspondent's office of the bank,

The

Statemxmtof Condition shown itboveis in accordance with the Annual Statement filed with the New York State

on.

April 12,

It has always-fteetv nwtiud and i» incorporated under the Iqtvs of th& Stat# of New*Yorkif\" ^ ' ^

Insurance Department.»

U Wall Street.
'■

-

V;1

{v>r'r




utsttl *

sharp contrast to the labor situation in this country, with some
2,000,000 men currently out on strike, the Canadian Department of
Labor reports that on Jam 31 in all Canada only 120.employees were

r

and; the Canadian

However, rumblings from the Canadian CIO.
Congress of Labor (CCL) indicate trouble ahead.
■

These unions can

hardly afford to accept the status^
counterparts-succeed in raising
quo in Canada if their American
hourly wage - rates here by the
15%-18% now in prospect..* .

equally clear that if the
basic steel wage rate in Canada
goes up, prices of a great many
manufactured
commodities will
is

This, in turn,
out-of-pocket
expenses of Canadian farmers and
will inevitably result in a de¬

have to go -up -too.;

the

will "increase

mand for

higher farm prices,
Canada, such developments
likely to be even more far-

For
are

feacSng in their effects than they
Canada is more
her export trade

will be here. For,

dependent

bonds

weaken

MARKETS maintained in
all classes of Canadian

external and internal

[ bonds,

'

:

Stock orders executed on*

Exchanges,

or

wage-price battle with
such keen interest.
.
I On the basis.'of tier past record,
American

Direct Private Wires to

it is riot likely that J Canada
wage

re¬

outcoiriehere.

the

supplied by this country, a sub¬
stantial
boost in
the price /of
American • steel is bound to in¬

Buffalo,

Canadian production costs,

crease

Exchange Place

New York 5, N. Y.
1'

Bell

will

price action,

or

of

gardless

Dominion Securities
Corporation
40

,

However, with about pnerthird of
her steel requirements normally

Toronto and Montreal

just

substantial wage boost
will ultimately force wage

as

here

of

view

In

and

our

!

t

PROVINCIAL

' Y

-

1

American

not achieve

labor

continued strong in all categories
with the demand good and the

sympathywiththe reactionllierc;
However, there
sure

was no

real pres¬

the. downside.

on

Lin¬

On

coln's Bithday, with our markets

was.

dull and only a shade easier;

As reported here before, we can
foresee no: near-term^change in
the upward trend of Canadian

a

solution and

a

fur¬

qver

ju¬

personal and
re-

own

and offer

theless, after World War I, Eng¬
land speculated on similar devel¬
opments.These, as is well known,

CANADIAN STOCKS

Henry G. S. Noble Dies;
Former Exchange Head

New York
article

ideas

is

a

This

short visit.

condensation

of his
reconstruction

financial

on

Continent—Editor-]

the

on

on

a

failed

to take place and yet the
Napoleonic Wars- are again refer¬
red to in discussions regarding the

in

manner

which

the

of World War II

consequences

To yield about

Henry Stebbins Noble.
For
twenty-five
years,

son,

Noble

was

Coppet

&

from this

tinued

Mr.
partner in De

full

a

He

Doremus.

retired

position in 1927 but

con¬

special partner of the
firm as long as he kept the seat
on the Exchange.
as

.

There is

no

doubt that the

econ¬

of the United States is suffi¬

omy

a

FRANCISCO,

the

this will be possible only if
serious

more

overtake

wars

Ernst &Co.
231

the

advantage

of

the

domestic

should be determined.

consumer,

Only if imports

increased, and

are

exports against payment not

nounces

Chicago 4, 111.

jour¬
whereas European devalua¬

avoidable

office

be

in

respects
country can

some

this

to that in Switzer¬
There officials and business

compared

land.
men

paying due attention to

are

this
question.
Secondly, it is
strongly advisable to draw up a
completely balanced budget with¬

further

delay.

as

This

be

can

achieved only if the
of the war debt is

accomplished

reasonable

Colony

in

within

a

period.

the United

British

The countries* that were defeat¬
ed in World War I, especially Ger¬
many

.

and.: Austria,

through

had to, gq
total inflation and were

a

States,

in the

nor

On

Commonwealth.

countries

the

the

like

Switzer¬

Portugal that
remained neutral during the war,
Sweden

and

be able to avoid such

•may

a

re-

eonstructipn, 4 The currency and
state finances of all the countries

Corporation

removal

of

an¬

its offices

52 Wall Street, New York.

to

their currencies

that-participated in the

war,

how¬

in such bad, often cha¬
otic condition that a financial reever,

are

reorganize

to

on

.

absolutely

an

In Germany this reor¬

basis.

ganization took place in the late
fall of 1923.
The original mark
was first replaced by the "Rentenmark" and that in.turn by the
"Reichsmark". The original paper
mark was exchanged at the rate of
1,000 billion paper marks to one
new mark.
The new currency, of

which only a small percentage was
covered by gold, immediately won
the confidence of the masses; that
was
not shaken even when the

quotation

of

temporarily
abroad.

showed

This

ily

discount

a

confidence

in

the

based primar¬

was

the fact that the circulation

on

•

restricted right from the start.
circulation

notes had
2.4

-

"Reichsmark"

the

"Rentenmark"

Rentenbank

of

been legally limited to
marks.
This amount;

billion

decidedly inadequate. Simultaneously bank credits were re¬

was

stricted to the utmost.
was a

deflation of

an

>

The result

unjustifiable
incidentally caused! h

extent which

an

intolerable rise in the rates of

/

interest. For short-term loans, in¬
terest up to 80% per annum had
to

be

in 1924 while, for
interest-bearing se¬
curities were selling at a yield of
7-8%.
To put it
bluntly, the
Reichsbank that was headed by
Dr. Schacht at that time-believed y
years,

European Continent; the situation
is entirely different.
There, at
best,

patient's

The German and Austrian

The

land,

prior to the War.

the

because

life is in danger.

was

the situation

opera¬

precaution

a

tions. are comparable to the same
operation when it has become un¬

States be solved. In

amortization

Colony in

First

as

before starting out on a long

overexpanded can. tl>e international
clearing problems of the United

out

New Location

Broadway, New York 5, N. Y.
So. LaSalle St.,

policies such as labor arid prices.
But he may:point out two things.
Which commodities are, or can be,
produced abroad and imported to

considered

TWO WALL STREET

120

in

CALIF.— actually

Francisco

San

for six years

First

appendix

an

out

new

It is possible that a real revolu¬

in

like

was

eventually forced

How¬

sense.

tion in the sphere of currency and
state finances need not take place

ard

tion

tion "carried

Inflations

Liquidation of the U. S. War Debt

no

mand. He was with Eaton & How¬

2.62%

In this respect the developments
between the two World Wars are

are

Howard, Incorporated, 333 Mont¬
gomery Street, afterfour years in
the Army Air Force.
Captain Field was a Squadron
Commander in the Training Com¬

4V2s, due Oct. 15,1958

Developments Between
the Wars

financial

his former position with Easton &

(Non-Callable)

Financial

to be overcome.

ever,

Charles D. Field has returned to

MANITOBA

.

//•/Ay

ney,

Y Henry G. S. Noble, president of thri present, generation arid: if'the
the New York Stock Exchange nation and the government suc¬

SAN

Province of

all domains of economy
inconceivable without the most
drastic and incisive measures.
* • i
is

debt in the orthodox

bond prices.

Charles D. Field Rejoins
Eaton & Howard Staff

subject

$125,000

NY-1-1045

to a series of
fortunate, . temporary c i r c u in¬
stances. ; Such a constellation was
riot likely to occur again, Never-

831)

ciently vigorous and comprehen¬
sive to enable it to pay off its war

ob¬

to

has been called for
April 25. At present the most ac¬
ceptable basis for agreement ap¬
pears to be as follows:

We

RECTOR 2-7231

the orthodox way,

page

covery in

some

CORPORATION

NEW YORK 5f N. Y.

effort—in

very instructive.
Even • countries •
[Mr. Dreyfus, the Swiss Banker,
of the
like. France,;;Belgium and Italy
certain that is the author of the book "Wirt- that-were victorious were unable
Ottawa will not again invade the schafts-Wende" (Turning Point of to :
restore/ ofder * in ■ their/ houseY
field of specific taxes except "in Economy), published in Switzer¬ hold.
A visible evidence of this
land last fall.
time t of emergency//; Americans
The ideas he ex¬ was the chronic weakness of the
who will recall the almost con¬ presses there on reconstruction of
currencies.- -■
Devaluations
that
stant "state of emergency" which currencies and public indebted¬ were
repeatedly undertaken dur¬
existed in this country between ness on the European Continent
ing this period brought about tem¬
1933 and 1939 under the New Deal are based on his 30 years' practi¬
porary improvement but were un¬
might suggest that * /'emergency? cal experience as head of the able to eliminate the evil itself.
be rather carefully defined if the banking house L. Dreyfus & Co. in
The dollar devaluation of 1933 was
and
Frankfort on Main another
amendment is to mean; anything; Berlin
story.
The government
A Turning to the markets for the during a period of the most pro¬ enforced it of its own free
will,
past week, there is still- little that nounced inflation and def lation in not being compelled by circum¬
Mr. Dreyfus is now in stances.
is new to report. Canadian bonds Germany.
The American devalua¬

being demanded by
provinces to make

Nobje owned a " seat on the Ex-*
adjustments are change that has been heldi)y his
brought about in Canada over the family through five generations,
next few months.
inheriting
thei/seat from i his
grandfather, Henry G. Stebbins
Although the Dominion-Provin¬ who joined the Exchange in 1831
cial
tax
conference
reportedly and was its president through the
CiVil War years, In
came near la a basis for agree¬
1938
he
ment in the last meeting, it did turned the seat over to his grand¬

corporate income taxes in

INCORPORATED

extraordinary

A constitutional amendment is

how these

risdiction

A. E. AMES & CO.

—after

ceed

1. Ottawa to have exclusive

MUNICIPAL

on an

own

ther meeting

GOVERNMENT

equal basis.

;
;

share succession duties

(Continued from

hapless during World War I and senior
avoiding grave mistakes.
muddling ;throttgh these serious irieipber of its board of governors A visitor from a foreign'country
adjustments,, it should, be a gqod at his retirement in 1938, died at should not give advice or express
objecf lesson for; Amencari ^busi¬ his home at the age of 87. Mr. an opinion regarding domestic
serve

CANADIAN BONDS

a

increases there.

ness

SyVteia Teletype NY 1-702-3

r

stampeded into hasty, ill con¬ closed, the Canadian stock market

ceived

at

„

competitive position supply tight. For
example, Can¬
in the world markets. No wonder adian
Pacific perpetual As sold^at
that Dominion officials arid busi¬ 116—an all time
high. The stock
nessmen alike' are watching the
market was somewhat easier5 iri

be

net New York Prices.

*'

'

her

,

'

»the Montreal and Toronto

Stock

on

than we are, and a general hike
in the cost of production would

stocks

On the Continent

increasing'national

-

: ;sive jurisdiction over, specific
taxes such as gasoline, amuse¬
ment, : gas, electricity, tele¬
phone and telegraph messages,
betting, etc.
3. Ottawa and the provinces to

;

out on strike.

v

income,

2.-The provinces to -have exclu-

In

Canadian Securities

ward with

,

,

.

By BRUCE WILLIAMS

It

Reconstruction

■/.Ythe provinces, based on 1942
•} • population /arid/;adjusted/up*;

Canadian Securities
«

Thursday, February 14, 1946

minimum guaranof $15 per capita to

turn for a
teed grant

',
■

<

chronicle

the commercial & financial

850

granted

fixed

that it had to replace the lacking
cover
by
deflation.
Ger¬
many's normal currency require¬

gold

ments at that time

billion marks.

were

about five

This amount

>

was

not reached until three years after

the stabilization of 1923.

responds exactly to the

It

cor-

>

currency.

in circulation before World "War Li

considering that banknotes had to;
take the place of a corresponding
amount of gold. " Thus, in the* case r
of future restoration

of the con-;,

tinental

Non-Callable

CANADIAN

$500,000

STOCKS

Canadian National Railways

taylor, deale
&

:

Bought—Sold—Quoted

Mines

GHARIES KING & CO.
61

Members Toronto Stock Exchange

Broadway N. Y.

Whitehall 4-8980

7;;

rWHltehall i

.3-1874.' *

London

or

y;

Price to

"

64 Wall Street, New York 5

4j/2% Bonds, Due Feb. 1, 1956
Principal: and interest payable New York, Canada

Toronto, Canada

Incorporated

Direct private wire to Toronto




14 Wall
Direct Private

CANADIAN

'

1

'

1

SECURITIES
*

Street, New York 5

Wires

to

the

.which, limitsv
should % be

circulation

note
.

;

•

•

.

'■

'Y The German^ currency "recovery,
has taught that even countries that/
have little or no gold can,, if they |
limit their circulation, re-establisti
their currency unassailably in a

yield 1.85%

Wood,* Gundy & Co.

Royal Bank Bldg.

Teletype NY 1-142

late;from it within
fixed.

Dominion of Canada Guaranteed

Industrials Y- Banks

Company

currencies, any country
that had a real "gold period" be-,
fore 1914 should be able to calcu- ?

Toronto and Montreal

Municipal

Government

Provincial

'

Y

Corporate

fixed relation to

gold provided the
indispensable; pre-conditions are
satisfied, namely, equilibrium ofY
the international balance of pay¬
and order in the national

ments

household.

-

•

If these German

•

*

experiences are

A

{Volume
*

'

'V,--.-

V.V.'V

v.',

•:

THE' COMMERCIAL & FINANCIAL CHRONICLE

Number .4464

163

V

W^\V-A' A

1

Continent the following as¬ as to which country would become
* v; the leader in this case one finds,
reflection, - that France
as u is oeyoha aoubt that without

kept in mind it should not be too

pean

difficult tq adopt the

pects should be mentioned:,

between

course

right middle

ii)

economically

an

financial order will be nec¬

inadvisable creation of money and

a new

credit

hand

one

and

un¬

t6rest rate must be at

level.

Excessively

rates

low 1 money

•:

undesirable

as

are

reasonable

a

essary

laorders to

action.

as exces¬

ensure

success

of domestic

mation

politics and the for¬
ofv a> strong "government

would of
ticn.

be

course

;By

Economically France is cut

v
,

raw

materials

ished it should have

replen¬

are

monetary; stability will

erted, by

be the stronger -the sooner it can
be connected with the disappear¬

Imately 160; billion gold marks.

ination of the time for reconstruc¬

After

the

reorganization of the
in 1924 it was fixed at

currency

approximately
marks.

10

billion

gold

This amount did not suf-

fice* and certainly did not satisfy
the
urgent social requirements

:

that

are

caused by such a recon¬

struction.

It

have

would

been

fair and bearable if the national
debt had been fixed at

a

of the pre-war total
marks.
Possibly it

could

minimum

of 40 billion
have

been raised to 60 billion marks. In

this way one could have avoided
the complete impoverishment of

the

middle

were

bone

to

a

income

of stable

tions.

great

that

groups

great extent the back¬
and

sound condi¬

Their disappearance was in
measure

extreme

responsible for

movement

like

an

Na¬

the

of the shortage. The determ¬

ance

no

of the last few years; a

long-term
value of the yellow metal has not
diminished but very visibly in¬
It is inconceivable that

creased.

restorations will
if they are
accomplished on the basis of

future

currency

fixed and unalterable relation to

will be able to afford the luxury
of keeping gold in circulation. In
what form it is to support the cir¬
culation
If

tion it
of

that

"Conflict

one

could

between

call

the

the

genera¬

tions/' The old generation will be
inclined to demand that no change

be made in the nominal amount of

the public debt on which the prod¬
uct of their life's work and

their

savings depend. It will prefer to
put" up with a slow decay of the
currency
because
an
inflation,
though veiled, is still more likely
to make possible the maintenance
of their former standards of living
than a reconstruction of the pub¬
lic debt with all its consequences.
Nor will the young generation at
first oppose an inflation because
during it money can be earned
relatively easily.
That was the
mentality in Germany during the
inflation period after World War
I. The young generation is not in¬
terested

in

preserving

old

for¬

tunes; even prospects of inherit¬
do. not affect this much.

ances

If

it is

vigorous it will prefer to ac¬
quire a fortune by its own efforts.
Very soon this will be accom¬
panied by a wish, to leave it ununimpaired to its oWty children.
As soon as the young generation
becomes- fully aware-of the' prob¬
lems indicated here, it will: fight
for the termination of inflationary
measures, as well as against exces¬
sively high taxation..
Takes to

^

'

*

the

scope

>.:>•.

of

performed im the sphere

.

domestic

in

economy

:

cumulates gold reserves .in- excess

ket will' prove unbearable,

Ul¬
timately the conflict between the

generations will end With

vic-

a

V tory of the young generation.
financial leaders

The

of all countries

this

/i,'v'•

"

as

well realize, this.
1'-

Jj

•
C'_ir'r

■*'/t1',^a•

The Aspects of Continental
Reconstruction

In

connection

with

the

'
recon¬

struction -necessary on the Euro¬




A

!
I

I
;

.

4

should contrast the inadvisability of acquiring investments that are

have

never

a

constructive

After serious economic

or

effect.

political

convulsions it may seem beneficial
for

a

short transition period.

after that only

fashioned" principles can
and

its

a

to new,

economy

lasting prosperity.
ture without

lead

highest principle for the individ¬
ual

as

well

There

as

is

a

barber who

for the government.

story

of

a

zealous

J

'j

other securities that have the earning power,

\-

future possibilities, and

general stability to warrant present prices.
These letters should stress the firm's convictions along the lines of
sound

investment procedure.

They should build good will because

people who make the best customers

are

the

ones

candid honesty-—no matter where they see it

they

can

of this country

can

_•

expressed.

j
j

the real investor— j
But the respoir-

j

do more to help control the

|

do less to protect the fool and his money.

sible security firm&

ij

who will appreciate

The public agencies can do little to protect

"No expendi¬

cover" must be the

|

adversely vulnerable to sudden changes in the economic outlook, with

But

clear, clean, "old-

avariciousness, and the greed of that portion of the public which is
only interested in gambling, than all the agencies of the government

»

combined.
one

day put

up a no¬

Those of

us

who

are

in the security business today can

back

up

When his customers wanted to be

obvious.

are

adjustment.
Then they will de¬
adj ustment
in mand categorically — "Not tomor¬
circulation and of credit,- the value row! Today!"
of the currency as such will de¬
pend on an ordered-international
Chilson Resumes Duties;
Balance of payments. The trend
of
capital movements
will be Finkle Added to Staff
very important in determining!he
KINGSTON, N. Y.—George L.
ratio of imports to exports.
Gov¬ Chilson, recently released from
ernment
planning will probably the Armed Forces, has returned to
be indispensable in this-connection his1 former association with Chil¬
for years to come. ' '
son, Newbery & Company, Inc.,
After

a

reasonable

and restriction' of- the currency

(3) In

of

view

the

numerous

of the economic system

Let's tell

and ignorant
we

each

proceeded
Never, in the past

country

independently.

jNTOTHINC'V

wish-fulfillment,

as

live

as

clear of bunkum, hokum ,

is within our.power.
our

By so doing»

customers, even though the ' ;

cyclone of inflation and a warped economic system may eventually
blow most of them away.

If several

the battle, we will at least have

years

from

maintained

our

now we

have lost,,

self respect.

With

that intact we usually can build anew.

A. DePinna Company

48 Main Street.

ment of the

ANYTHING FOR

customers these basic facts—let's try and keep our.

will do all that is possible to keep

$0.60 Convertible Preferred Stock

restorations that will beHarold E. Finkle, recently re¬
the European Con¬ leased from the Army, is now
tinent it would be very inexpe¬ associated with the Sales Depart¬
if

our

One of the brisic laws of •:

live.

we

little part of the world in which we

neeessary on

dient

in which

that system is that "YOU CAN'T GET

currency

Class A Stock

company.

Circular

on

request

has there been such an opportun¬

ity to create the
an

Edward Greeff Returns
pre-condition for

international

collaboration

in

was

already too

"heavy", not to speak of the U. S.
A. dollar. A return to the old gold,
franc,

could

be

considered

as

to

Adams & Peck

Edward R. Greeff has been

re¬

leased from active duty as a lieu¬
tenant commander in the' U. S.
Naval Reserve

and

has

Herrick,Waddell & Co., Inc.
55 LIBERTY STREET, NEW YORK 5,

N. Y.

resumed

his position with Adams & Peck,
63 Wall Street, New York City.
-

Leigh With Prosser
J.' Roy Prosser & Co., 52 Wil¬
liam Street, New York City, an¬
•

nounce

that Douglas B.

become

Over-the-counter Quotation Services
For 32 Years

Leigh has

associated with

them

in

their Sales Department.

established by the law of the 7th

of Germinal. XI (March 28„ 1803)
or

might
■

the way of least resistance; it can

actual requirements fon served without paying the sly
trade and clearing, this heightens barber pointed to the notice and
its economic esteem in the inter¬ said, "Tomorrow."
The nations
national sphere.
The reasons for have
still a Very short time for

Reichsmark

seem

of them

the traces—why not get them back on the

.

its

of

th£r;currencyunit; represents,ythe
better.
In this respect the old

will

over

whom you should

If ypu see some

our

than 25-HO % in the highest brac¬

a war

real heart to heart talk.

I

knowledge and experience' with a higher form of idealism, than I
country, the part it is- called upon ing free."
When' on the day fol¬
ever came about through legislation.
to play in international trade and:
We know this business. Ours J
lowing
this
announcement
a
clearing is in no way affected. An
is a difficult profession. We are realists and we know that the job
"Ersatz" for gold that could level crowd of customers blocked the
of forecasting future events is based upon something more intangible
traffic in front of the store the
out the excess in the balance of
than almost any other field of human activity.
We can translate our,
payments has not yet been found. notice had. not yet been removed.
When a country - possesses or ac¬
experience into actions that show the way to a better undpr^tandmgH^

intol¬

.during

a

beginning to jump

every tice in his store: "Tomorrow shav¬

erable very soon after- it.i An in¬
come tax: that takes away more

which^very rone^submitkwithout

Now these regular customers are the ones with

sit down and have

dangers of overlooking real values in the quest of quick profits. They

r

the-currency domain. Such a co¬
operation.: could now be, prepared
by a uniform relation of the West¬
ern European; currencies, to gold,
whereas the time has not yet come
to form currency-: unions.
The
"lighter'' this uniform parity is;
that is, the- lower; the, gold ?value

ado

> or

Open and veiled inflation goes

gold is divested of the func¬

its amortization

ensue

beyond

is

this article.

their public debt has risen to such
an extent that interest on it and

of new fortunes, something
will consciously or unconsciously

age

Parisian fea¬
tures that make them to a great
extent independent of fluctuations

nation

But also the countries that can

tion

French

«

themselves from gold in the course

On the other hand, no country

paid only
with the help of, taxes that im¬
moderately impede the accumula¬

is also a large percent¬
of old-time security buyers who are also beginning to throw
fundamentals overboard, and they too are looking longingly for the
will-of-the-wisp of quick profits.
These are the people who have
been the backbone of every dealer's clientele during the past ten
on the market.. The weakness "of
years.
They were security buyers before the present crop of suckers
the French currency in the twen¬
ever heard of Commonwealth & Southern warrants.
,■

special

the world have emancipated

over

gold.

be

dis¬

track of, common sense, and of sound and tried principles. "REMEMnection with its foreign policy and
]BER IT'S NOT THE PAPER PROFITS YOU HAVE TODAY THAT
especially regarding the Contin¬
COUNT; IT'S WHERE YOU ARE GOING*TO BE WHEN4 THIS
It is not probable that the indi¬ ent, that can only spell her future
This
vidual continental countries will disaster and, instead, takes over PARTY IS OVER THAT'S OF PARAMOUNT IMPORTANCE,"
undertake
their
reconstruction the financial leadership for which theme could be the subject matter of a series of well written letters
separately. An extensive co-oper¬ it seems qualified, this will be its that could be sent to all your better customers.
ation will be imperative.
More surest way to maintain or rather
These letters should be written in an impersonal style.
They
will be said of this later.
regain its position: as a great
should not preach.
They should cover general subjects such as the
;
(2) Though the currencies all power.

hope to restore order in their fi¬

can

a

problems is taken in

vital

these

a

tion, should not overlook the fact
that if in the course of the war

that

hand.

not

without actual reconstruc¬

assurance

that which

Along with the naive amateur speculator who has recently made

ties and thirties could always be
and quiet within the coun¬ traced more to the passive state of
capital movement than of
try. ' It is also indispensable that the
If France
there be no international tensions trade in merchandise.
renounces its aspirations in con¬
threatening when the solution of

power.

nances

as

his appearance in the security markets, there

tion is furthermore dependent on

have any permanency

Generations"

no

security prices will soon take place on any such
happened in 1929. Yet the public is forcing prices
of many highly dubious common stocks up to point where real values
are certainly out of line with any semblance of reality.
Such stocks
(many recently in the penny class) are the usual bait for the unin¬
formed speculator.
1
.

scale

peace

tional Socialist Party coming into

"The Conflict Between the

There is

astrous deflation in

difficulty
maintaining the equilibrium of

it totalled
By
the beginning
of the inflation
period it had increased to approxwar,

Dealers today should be thinking about methods of keeping their
in the event of a repetition of conditions which transpired

in the securities markets in 1929.

stocks of

the acute shortage that has been

its

once

'

the

DUTTON:

clientele

on4 the Continent.. When

must first be
sively high ones. The proper rate
This is one indispen-, in
will probably be 3 to 5 per cent, eliminated.
sable pre-cohditioii for the disap¬ its- trade balance. Witn the excep¬
according to the situation of the
tion of a few raw materials like
country.
4
;
' pearance of the black markets.
»It is also most instructive to The other — and this may not: be rubber and copper, France can
cover almost its entire import de¬
study the reconstruction of ;the overlooked ..is the. creation of a
The fav¬ mand from its colonies while its
public debt in Germany after new sound currency.
•World War I. In 1914, before the orable psychological influence ex¬ important export products have
outbreak: of

JOHN

pre^condi-

a

out for the role of financial leader

caused, by. the war

about. 40 billion, gold marks.

Securities Salesman's Corner

The clarification

ranks foremost.

in all the continental coun¬
tries that participated in-the war
there should be no further discus¬
sion of the principle, but merely
a decision as to tne moment: for

the

on

justifiable deflationary' measures
on the other.
Again it is a selfevident pre-condition that the- in?:

851

the

chosen

parity of the Swiss franc

determined after the de¬
valuation of 1936.
as

(4) It is
question of

conceivable
a currency

that

the

restoration

the continent may become ac¬
tual overnight.
As to the question
on

Sedgwick With Tripp & Co.
Robert
returned

B.

Sedgwick, recently
active duty with

from

[ NATIONAL QUOTATION

A.U.S., is now associated with
Tripp & Co., Inc., 40 Wall Street,
New York

partment.

City, in their sales de¬
-

BUREAU, Inc.

Established 1913

the

46 Front Street, New

Chicago

York 4, N. Y.

San Francisco

THE

852

COMMERCIAL-& FINANCIAL CHRONICLE

Thursday*- February 14,-1946-

decision rested first upon

Needed: A New Labor Policy
(Continued from first page)
all know* that Congress-is
full of bills today—extreme bills

You

and,

bills, short bills

&nd moderate

lengthy ones.
The extreme bills
carry
what people describeas
compulsory features.
They want
to end our present difficulties by
compelling somebody or other to
do something that they seem dis¬
inclined to do and there appear to
be

in the United

of people

lot

a

that frame of mind to¬

States in

the moderate ones,
set up some kind of ma¬

Other bills,
want to

chinery,
are

which

fact-finding machinery.
already full of machinery
multiplying

have been

we

pretty rapid rate in the last
15 years and the great prob¬
lem in this country seems to me to
at

a

10

or

be to

that machinery

absorb

assuming

it,

digest

want

we

,

to

I am no believer in

retain it.

this labor
I don't think it

solutions

magical

and

problem of ours.

of

;

lends itself to that kind of treat¬
and

ment

itself

lend

if it

even

kind

that

to

appeared

to

treat¬

of

ment, I doubt the wisdom of that
of

sort

for

solution

opinion

the

and
are

my

reasons

twofold.

I

don't think compulsory legislation
will work.
>
'■ \

think

afford)

can't

we

longer

any

States.

The

labor

decisions

policy

in

We have

tended, I think, and
realizes,
to
become

everybody

lawless

more

more

spite of the fact

that

imd

adopted

passed

statute

From

longer,

lieve

what

dress

ourselves

have

we

to

I

so

be¬

remedied

if

propose in the
future to deal with it sensibly and
we

constructively.
•

The

question

one

policy,

our

What

has

\

<,

,

is

labor

our

labor economic policy.
this
policy i been?

Where is it leading us? " What do
need

we

do

to

with

this

policy

in order to reduce it to workable

4 The

terms?

policy

our

second

question

is

to law and adminis¬

as

tration in the whole field of labor

and
I
want
to stalk
briefly about these two aspects of
the. question.
4

in

1935

which
a

after

policy of

labor

our

all

reduces

policy,

itself

to

Whose primary objective it was to

reduce

now

relations

labor

to

peace¬

have

wages.

public policv toward

a

ful negotiations, peaceful and ra-

wages,

1 lonal

unworkable.

negotiations; and yet since

1935 We have become

7awless.

People

V':

these issues in
mind
and

not

are

large

we

increasingly
who
approach

lawless frame of

a

going to submit by
compulsion, and if

to

to deal with this

are

lawlessness^-and-'I

of

back

rome

got

to

it

to

take

problem
to

mean

later—we

have

point

range

The
secondhand. I think the
major difficulty about compulsion,
is when you start compelling one

party to do something, you
pel everybody.
Compulsion
anvihing

that

within

sphere and

a

j

narrow

isn't

area

know the

we

com¬

limited for

be

can

or

history

of

something approximating com¬
pulsion-. in the so-called public
Utility industry.- Once you begin
to. ret; up machinery that compels
certain

a

labor

then

type'.of

disputes

adjustment

in? the

open %

you

It

is

for
thoroughgoing, complete regula¬
tion cj., all business activities, all
\vav

mistake

a

or

to

policy originated in
August or after the war or during
the war.?4'It is a policy we have
been

flirting with since 1933 and
through the passage of these 12
13

or

eral

since

years

1933

administration,

that

this
at

our;

^Fed¬

any

at

have- made

to

seems

rate,

its mind

up

policy is correct.

this

policy and

it is and what it has

Let's

"

what

see

accomplished

through its various phases because
we
a

used it from

1933 to

modified form

from 1939 to 1945 and

using

it

once

different
into

fo

:

more

now

in

In

again

we

are

totally

a

setting. ?; Without going

technicalities

the

1939.

used it

we

-

annealing

and

authority

like ' John M.
Keynes and other people in this
country who happen to be his fol¬
lowers, you can exDlain this .pol¬
icy pretty easily. The parts of it

industry, Amount- to this.

.

the

Of

bad, workable

or

this

look

longer

a

of view.

held

good

think

-

'

.

»

-

-

ih

this

country

better

begin

to

rate,;

at

the

You raise

point

of wage

keep stable or
reduce the wage rate, depending
on what you want to ha
open in
economic

your

or

The

system.

sec¬

ond, part

the

decisions.

wage

rate

thing

vague

at

All

come

I regard that as much the
of these

going
only

two evils.

to

compel,

skeptical

but

enacting

the

sumer

If

we

and

I

worse

not

are

ell.

That

see

and

you

to

further

moted
toe

is

^sy

like

do

and

is

of law

at

laws

ought to
cmnst.ion
inflation.

You

see an

unfolding

there

argue

at

is

left

abort

it

things would lead

inflation

called

which

con¬

which

has

part in the eco¬

knew

ever

economics.

gauge

isn't

There

arithmetic of the kind Walter

any

pro¬

there

some

form

or

another, and the labor problem is
this sort of-a problem.




somehow

independence,
tween wages

the

doctrine

other

or

this

that

is

separation

a

and prices.
that

seems

an

be¬

That is
to

moti¬

vate Mr. Bowles, for

example, and
many
of our influential public
officials at this time.
If you look
at that doctrine, you can see we
have been applying it.
We
plied it when we wrestled in
other

ought

/
view,
opinion, and because
of political forces, very powerful
political forces, we had really
begun to augment them all during
the war, the Administration issued
its statement of policy, and it was

the middle

not.

or

The

;

make

you
a

only

up

policy works

standard

you

The United
States Government has a policy' of

of

doomed

was

doomed

embarked

1945.
to

failure.

It

fact

or condition, so? that the Pal
Razor Blade Company, one of our v

adjustment, and that is going to?

in

be

it

common sense stand¬
You look back oyer a period

correct ' and

"This was our theory.
We put it into effect and exploited

we are not
going to get out of
these present labor difficulties un¬

it

less

say,

didn't." f;I

or

reasonable

don't think

man

can

look

any

the

at

revise

about

purchasing

know what the

and

power,

shows.

record

Fif¬

bad record,

a

teen

per cent of our population
unemployed, not at the depth
of the depression, not at the depth
of a world-wide, extraordinarily
severe depression, but at the peak
of a business recovery/ That was
a
unique
phenomenon
in ythe
United States; one we never en¬

countered
know

before

when

far

so

we

as

proceeding
different from

were

we

along lines

quite

those which

we

pursued when

Collective Bargaining

general

sensb

common

have,

evidenced toy

cide

the

would

record

to reasonable

prove

we

to

seem

that that

men

sort of thing doesn't work. During
the
war ' we
passed to another

phase where again we were con¬
cerned about
inflationary pres¬
sures

sand argued out the

tionary
the

phenomenon

not

they

infla¬
during

made two decisions.

war we

am

and

^talking

.

I

whether

about

well administered, but

were

a

wholesale

wish

to

have

we

then

got

we

decision that

trol

continue

to; make

and

continue

something

lift

to

unless

them

done about it, and.

was

tinue

Wholesale

a

They could have been settled and;
settled

control

of

It

termination

and

of

related

and

v4

^

held

during
the war, putting aside whether we
administered it properly or not,
and we were holding that view in
1941 when prices began to go out.
Prices are misleading and decep¬
tive

unless you watch them

carefully.

very

When prices went

up

trine

does

and

so

to

so

give

;

their

clients, and another way about a
doctrine today when the doctrine
has another effect.', Take the doc¬
of

capacity

to

form
with

employment

under

or

the

question

from

1933

ap¬
an¬

another

of
to

full
1939.

that

in

order

to

regulate prices you have got to
the principal items of
cost.
It was a public admission,

regulate
and

everybody

cause

agreed

it seemed to be

to

one

it

be¬

of those

simple economic truths which

we

the UAW

with

seemed

the

and

think

to

cases

records

;

cies.

we

had

when
to

the

decide

war

was

upon

policy, a labor
policy, and that decision

an

I

no

have; had $re»4

iye

If

had

economic

labor

read

can

be¬

tween the ! fries

in the reports that;
ppeared in - the newspapers in;
the last couple of days that fact;
a

in the Gov¬

is

about v their

beehming to dawn

on

the Ad¬

ministration.

'

;r;:|

*

;44;

York

New

State,
Company;

A

Wage Policy ^Revision

cen¬

Under

Wsty

Pal

the
It

Some kind

of

organized
by
the
Machinists'
during the war when Gov^

general revision
of the wage policy of this country
is under way.; I ant not optimistic?

ernmental

and sanguine as to what it will be.;

Blade

was

Union

authorities
themselves

,

projected

period

nost.-war

tried

and

I

theory
Machinists'

Union

Blade

asked

Company for

cents,

now

10-

had is

one

Then

hour.

it

Board

went

in

different
talk

they

wrestled

with

it

out

of decision,

policy and.

great number of

directions, which I can't
now for
lack of time.,

the

with

The Wagner Act

•

,

;■

came

a

about

York

with
this
conundrum for about eight, or nine
months and then after they had
and

wrestled

to

New

reports in Wash-,

unworkable

an

unworkable in

between five and 10 cents

War; Labor

fancy

general

a

.

an

a

understanding in
Washington that the policy they;

incapable of solution—the differerence

be

ington, and that is that there is

typical American puzzles

of these

will

,

in wages,

offered five

they

a

it

out of the

comes

Pal

the

afraid

am

thing nobody will understand, but
one
thing is clear from what

to

what a capacity to pay
would • look
like.
The

imagine

Razor

not
the

had
into

The

second

derlying

one,

legislative

difficulty,
is

)

un¬

political and

our

policies.

;
an

?

Unless

we

■

come

grins with these political
legislative
policies we are.
to

eco¬

policymaking

economic
was

either

have

over

made

We didn't call it full employment

and

then, but better employment and

of 1945* Let's see what .it was. That

made

We

unworkable.

pay

Plattsburg, a great industrial

*

perfectly I and
They said 'going to have a period of "labor
the increase should be 16 cents trouble and not a short
period;
an hour,
an increase nobody had 'but a prolonged period of labor
asked for. but the ways of these .trouble in which
things get set-

l-(

Post-war Policy Unworkable

nomic

somewhere

to grips and

come

clean-cut, clear
policies or those

Take* for example, a plant in
of

official

We have

to
explain
and
explore,?;
publicize these problems of
underlying Jabot; economic poli-»

Garrison

capacity to

classic

are

ernment

unthinkable

Nov/

isi;

That

argue,

a.-good; system?before they
threw
it
out
of ; the
window.

this

The

deal.

better

a

[ have

The Administration

ministration.

of.1945.

,

of

settle.

hanpened in this country.
4
Why should anybody sell or set-4

else?

General Motors tried to fight out

retained anyhow until the middle
.

him

with

which

pay,

living,

admission

he. doesn't

waits around and does some-;;

tie for 15, 12 or 13 cents if he,,
and things of that kind,. and has it back in his mind if
he,
as always happens, political agen¬
waited long enough he could make
cies adapt their, views 4
;;the a better
settlement, not with his
times.
They feel one way about
employer or the party he is ac¬
a doctrine one day when the doc¬
customed 4 to bargain, with,
but;

cent;an hour increase

an

parties

course

pay,

and

month, and the cost of
everybody got disturbed,

of the

what

com¬

more

plex ideas, the idea of capacity to

Razor

we

one

to

idea,*it got itself involved in all

ter

That is the view

and,

terms,

parties them-?;

thing spectacular,, he can appeal,;
an
agency somewhere that will',

should

get into difficulty
having started with a simple

sorts

if

negotiations ,if

inevitable the Adminis¬

was

and

would be added to this first force

inflationary rises in

moderate

is led to believe in the

The "Ability to Pay" Problem,

and encourage

faster rate.

in

settled by the two

•

views.

a

wage

one

prices.

secondly,
forces
which
tended
constantly to raise costs of doing
business,
costs
of
production

prices at

some

disputes there ever
presented in this country.'

were

Fact-Finding Board and the Ad¬

increase
income,

we

most of
of
the 4

items: of cost - at the selves
if there had not been nutWe won't successfully side
interference but you can't
> without
the
other, settle any. contract or you can't
assuming; it is desirable to con¬ bring any difficult negotiations tocontrol

these forces: one, a great
in
income, expendable '

great shortage

fall,

in

country

industries:

easiest

the

in

focus

a

this

time.

same

v

a

to

in

these;

con¬

trine

talking

am

movement got tinder
sometime last summer and;

came

that,
the

will have to

we

of the system of
ideas, and we decided during the
war that inflation is promoted
by

I

have

we

wage

had

con¬

major

-

tration

any

that

standards

very

trol Of prices,? ahd I haven't time
to talk about that, but if We de¬

"

the

a

want to continue

■'

on

the
way

difficult thing and
make up our minds whether we

adopted these theories.*- !;.?**

So,

which

theory

or

we

The "Little Steel" Formula

are

One of the difficulties with the *

and arrive at the correct policy.
make up our minds

trines
we

which

The Fallacy of Interference in

or' other

We have to

The record is

these wage

all

policies

change our evolved is it hasn't worked and
underlying economic labor policy has*
precipitated strikes;
When*
we

period 1933 to 1939 and say that
we did not fully exploit these doc¬
of

and

bandied back and forth.

unworkable and because it is in¬

ard.

sometime

with

fact

is

have is the
and

the

theories

was

because

wrongly in the middle

>

small businesses, had to make that ?

It obviously

failure

to

on

*

;

wage-fixing, and that policy of?
wage-fixing transcends any other;

wages

time raising prices, and that

can

Gov¬

concerned

not

with capacity to pay.

without the country's un¬
dergoing the necessity of at the
is the theory we

States

the United

was

Government—is

raised

same

with the
Board, and J

Labor

they
were
the;
spokesmen for the United States

be substantially

that

War

ernment—and;

Wages could and should be sub¬

Reuther talks about to which you

appeal to help
your mind whether

sion

\.

and

,

That stayed then

National

of

stantially raised,

accept the 16 cents,
can't agree to paying re-,

well."

Because of that conflict of

;

We

we

the experts there finally made a$
decision both as to ; the 16 cents;
and retroactive pay, and the deci-;

policymakers.

-;

,

an hour to some point ;
early 1942 because the decision ;
carries a back-pay provision, as ;

policy, and it is difficult
f prospect weighed
heavily in the minds of the

to this effect.

these

in

which

conflict

all

of 16 cents

a

see

more

to, help

troactive pay back in the amount ;

you

be awfully hard to

month after

very

name

of

expenditure,

to occupy a

system nobody
it occupied before. ^

to

encouraged

control

purchasing

expenditure,

nomic

stopped, ought to be brought

under

I.;,'

you

was

we

all

how

widely
accepted
in
country and. in Eagland—is

movement

about

know

in

and at that time we conceived the
Little
Steel
Formula, and * that

no

the problem.

end say certain
to

it

an

It

r'ntionary

r'sflf

for

is

isn't

answer.

Vo.'i
i

what

don't

present time is the most important
part of this prevailing doctrine,

kind

than

worse

then

do'1
to

are

I

results

not

am

simply because we
rot ready for a law, and poor

am

spent to finance World War
•

to

but

deflation,

could and should

we

The third part—and this at the

r-oment

laws

of what

excess,

make

about

amount

an

in

spent

we

comnulsion

about

any

this

determines

power, or total
Poor Laws Worst Than None

1939

right.

was

If

both inflation and

There

operations and

of its business

deflation.1

and

inflation

nomic

of this doctrine,, view,
belief, theory, whatever you want
to call it, is that determination of

all

to

of

money.

'notion

wanted

years, and they didn't know what,
to
do
about it,
and said, "All;

was;

itself f6r continuing and
growing regulation of all of its

prepare

1933

billions

cool

device

,

regulate it

private competitive business

conflicting

portant

.One part is; that the,Wage rate of goods.
That, we said—and I
is the moving, force in the eco¬ think
correctly—would lift prices
system.
If vou want to
regulate the economic system, you

then

general

:

busings decisions, and I think the

compumory statutes, is if they are
enacted, if they come into
effect,

related

and in the face of

greater*

danger about this com¬
pulsory legislation, these proposed

the

was

Our Labor Policy

Now let's take

in

Government

equal, if not in

difficult question, highly difficult

undertaking, of trying to bring to
the surface two things about our
labor problem which need to be

the

spending

got to ad¬
this highly

is

less

this

in

during that period and also

rate

The American
public policy toward wages.
We

a

rate

invoked

any

people

many

much

as to public debt, as
prices, and they are inextric¬
ably intertwined.
You can't sepa¬

lawless in
we

and

fixing from 1933 to 1939.
We
stepped wages up at a very rapid

as

taxation,

them

period this theory
I doubt that there

public of the United States, who
realize the degree to which we
adopted that policy of wage rate

to

relations.

labor

in

We have become

that

very

room,

|we make

make

in

ment

that the United States faced both

it is going to

are

now,

we

condition

face

evolved,

in

mental decisions that

to'-a

available -labor

the

rather

I believe,
importance or equal
importance the most funda¬

transcend

which

the

supply came to be absorbed into
employment, and in that theory,

to

relations,

in Labor Relations

Lawlessness

under

its
discussion
to
private
meetings. I think it is the great¬
est
public issue of the United
in

approximation

an

way

our

limit

to

day.

We

We have got to

through and we have got to think
our
way
through it in public.
This problem has grown so big

conflict¬

and they are still in
atmosphere.
The most im¬

ing notions,

kind

agencies

terious, you know.
Here

was

a

decision.

the

Pal

are

mys¬
Blade

Company, a small business of the

.type

the United

I
i

,,

Razor

States Govern¬

tied and

then

and nobody

situation

break out again,

quite knows what the

issues will be.

When you have a

of this

kind

you

labor trouble and invite it.

court
.

'

;

.Volume

.Let

me

and

about the

'word

a

say

himself,

the National Labor

so

policies.
You' all know that the
great basic labor statute in this
country which governs labor re¬

Relations Board ordered

lations, and has for the last 12
years, is the Wagner Act.
Now,
the Wagner Act, I should say, was
a
popular Act. - It, won public
opinion and popular support... Its
principal aim was to redress a

time during which

lack of balance which great num¬

after the first defeat.

bers

plication V of

of

on one

carried

was

the

had

they

then

question or even approximate the
handling of it by hasty legislation
drawn up with some little specific
end in view.

after

v"

on.

a period of
electioneering
'
" > }g-

,

Trading on Amsterdam Stock Exchange

|

:l|||lf||i^;Revives Slowly yK /$ ■ K./

-,

,

,

Taken

Measures

?;

Review Our Labor Policy

ployees, and the union
defeated.

Government toward labor on a lot

was again
This made the situation

of

unfair than it had been

even more

Let

fronts.

and then I am

This multi¬

.

simply
possibly ac¬

democratic country, so
it again complained, and this time
the NLRB went further and tried

undertakes to enforce
the law. We have no standards
of force any more in this country
in labor relations.
If a group of
unions decide to pull down a city,
as they did in Stamford, and are
threatening to do in New York on
Monday, and pull out people with
no
grievance
under collective
contracts with 'their
employees

something

side and in¬

no one can

cept in a

dustry, and the Wagner Act went

Whatever the
terms of the Act, I don't - think
there is any piece of legislation
on the statute books, in the United
States which has been so poorly,

i

to

Mr, Crawford from talk¬

stop

Finally, there was a decision
from the U. S.
Supreme Court
ing.

which

arbitrarily administered as the

said

have got

you

right

a

to

talk, some right to talk to your
employees and tell them what you

in

securities,

made

was

tion

for

had

declared

hold

■:

the

itself

disabilities

removes

the

from

a

other

party on, labor
relations or both parties, but this
goes farther and makes the Govr
ernment an
organizing agency,
puts the Government into a posi¬
tion where it says to a group of
employees. "We don't like vour
staying out of a union. We think
you ought to join this one," or if
they joined one the, Government
is put in a position and exercises
the power and influence by say¬
ing, "We don't like the unioN you
are in.
We are going to force you
to join another."
or

series of them.

tions

and

are

Good

-

much

as

elec¬

as

in

Trade

its

Securities

willingness

was

all

for

of

fund

A

Western

pendent

Electric

union,

Electrical and
the

CIO

members.

those

I don't blame them.

of

Workers

Radio

wanted

United

the

and

inde¬

an

raised by the Asso¬

change mustguarantee the bona
ownership of each security
placed into his hands by his cus¬
tomer. If it appears that the se¬
curity sold through his services,
belongs to a previous owner and
was not bought through regular
stock exchange channels, the As¬
sociation refunds the sales price
and

in

paid
Stock

turn

claims

the

amount

the

from the member, of
Exchange.

Amsterdam stock brokers have
also

It is

>

a

val¬

tb get
.

formed

a

new:

association.

One of its conditions of member¬

ship is that each candidate must
also be

a

tion for

member of the Associa¬

in Securities.

the Trade

Brokers refuse for the time being
to

;

g They are likely
rather than better,

(). Ky.;,;:j-..

v./■;. ?• •

Netherlands

limit stock

Ministry

the

to

f.

the

;' by

Finance

of

exchange transactions
and

of interior bonds

sale

for

payment

these may be made only from one
blocked

account into another.

No

fide

months, or a year to address
themselves to, this American labor

ican labor relations.

■.K.

Regulations /' issued

.

400.000

Each member of the Stock Ex¬

get tired

had

orders from unknown

persons.

sulting from illegal sales.. :K\k:K: mortgages/while

problem which, in my judgment,
out by them after awhile, and is a continuing problem. I don't
pretty soon let the union win to think any of the present settle¬
ments settle the future of Amer¬
be rid of elections.
g

icans like to vote, they

not accept

to

ciation to underwrite all losses re¬

six

Amer¬

as

permitted the

year

decision^

responsible

transactions.

guilders

the

only after the Associa¬

,

one

Trade in Old Secur¬

this

When the Netherlands Government early

trade

ceptions,

Wagner Act has. As long as that
situation prevails, you can amend
think about things, and the right
the Wagner Act, you can rewrite
and pull out a city, if they decide
it or write new laws, and; we will $0 talk is not limited to the repre¬
sentatives of one side of this very to make a building or a plant or
not drag ourselves out of these
heated and difficult controversy. a mill or a mine inaccessible, they
difficulties, and that is the prin¬
g Anyhow, Mr. Crawford went to do it, and there is no authority to
cipal problem of the Wagner Act.
call them for it, \
one U. S. Court and, they reversed
Let me tell you what you can
We have reached a lawless state
the decision of a lower court, and
do under the Act by way of illus¬
he talked again,, and again in a and Government is a party to it
tration.
The Wagner Act makes
thing has got to be dis¬
third election the union was de¬ This
it possible for Government offi¬
The facts have got to be
feated.
If anybody thinks that cussed.
cials to organize unions, a wholly
ends that episode, he is wrong. I brought out and the thing for
new function.
That is quite dif¬
am willing to wager that election
Congress to do is set, up a joint
ferent
from
the
Government
is going to be declared an unfair Congressional committee of good
passing a statute administering it, election and there are going to be people, able men, and give them
which

or

reopening of the Amsterdam Stock Exchange and the resumption of

any; longer under the labor law of
this country, with very few ex¬

is

defeats

New

Capital From Reconstruction.

ities in Order Not to Drain

me mention one
through.
Nobody

of Securities
Unknown

Fide Ownership

Bona

Assure

to

Brokers to Accept No
gWe have got to review our labor K in all Transactions.
Customers and No Free Money to Be Used for
policy, the policy of the Federal

The President spoke to his em¬

;

into effect in 1935,

so

and

election

second

existed

thought

people

between labor

election,

second

a

853

FINANCIAL CHRONICLE

THE COMMERCIAL &

Number 4464

163,

accept new customers and do

free money may be used
in old

securities

to

v

be

applied

capitalization and recon¬

new

'

struction,
i

it is essential

as

free funds

that these

fo^ trade

1

-

,

In order to promote investment

of free money,

the government is

issuing negotiable savings certifi-'
cates bearing
further

2lk% interest. As a

inducement, these savings

certificates may be used for pay¬

special tax.levies and in¬

ment of

heritance

the

Moreover,

taxes.

certificates may be purchased out
of blocked funds, up

of 300 guilders.

.

to an amount

'■

•.

worse
•

so there will
periods of quiet, but when
talk * about devising a fur¬

"

"

:

'

'

come
we

property, and in a com¬ nished labor policy for this coun¬
petitive system you have a right try by statute and administrative
to bid for a property, which is orders and
regulations, we are
what this is.
Stripped of all its talking about something which is
language, it is a bidding for prop¬ important for the future of the
Here is an illustration.
There
erty, One of our most successful economic system of the United
vis a big plant in Cleveland, atnd a
bidders ; is John L. Lewis. ' He States as we talked about when
well-conducted
business
of
its
bids for properties. - It doesn't the
Congressional
committees
kind—good
working
conditions make a difference whether you for
number of - years' studied
and rates Of pay, all - of which5are
calL it labor property.:
the American banking system and
It is a
irrelevant to our labor relations
out. of that seems to have devised
property,: all - right.
'
?
.
today.
Our aims are in: some
They started to bid id Kearney the Federal Reserve Systems This
other
direction.:
This
is
the
It is
and Sparrows Point, Baltimore, is the same kind of problem.
; Thompson Products Company, a
basic fundamental
issue
in
and when you don't get anywhere a
well-known plant., It has been in
in open bidding you go to Wash¬ American life, and we have to do
litigation from the beginning of
ington and say you have been un¬ something about it and know what
time, which is 1935. What is the
fairly1 treated, and the United we are about, and the only, way.
litigation about?
It is a very
Electric and Radio Workers went to find out and draft satisfactory
simple human relationship,
to Washington and made a com¬ legislation is to have a responsible
f Thompson Products employed a plaint before the NLRB, and they legislative
committee
of both
given number of people. It is one pondered that and found some¬ houses
of
Congress
put
their
uable

'

'

JOHN SCOTT
CITY OF

MEDAL*

/': "M E DA t OF -TH B

'

;

■' •

'<'• >y

ROYAL PHOTOGRAPHIC SOClETY

PHILADELPHIA

GREAT

■'

THOMAS

EDISON

ALVA

.AMERICAN

BRITAIN

MEDAj.

INSTITUTE

OF

ELECTRICAL ENGINEERS

.

of these

large-numbered mediumin the country, and
organizers
went
forth,
sallied
forth to bring, thesepeople into
the UAW, CIO, a well-known de¬
liberative
organization,
having
today something like a million
members in. control over ;a large
segment of American industry.
firms

sized

.

T«hey weren't successful in their
organizing activities and that to¬
day has become in the nature of
a crime.
Not to be successful in

;

organizing activities is one of the
high crimes of American law.
Anyway, they persisted* in the
thing and in one of their campaigns the President of Thompson
Products, Mr. Crawford, thought
it was within his rights to counsel
with his employees: that is, he
said
an

substance to

in

outsider

comes

himself, ."If

in and tells my

employees what is good for them,
I, knowing much more about this
business and, status, of. the em¬
have

ployees,

right

the

to

tell

them what I think."

That raised

nally

the

an

Labor

Board invoked

tions

declared it disestablished,: which
imeansj putting>it but ogbusinessi
destroying it because it was com¬
pany
dominated.;
What
they

the

Rela¬

demo¬

cratic instrument it has at its dis¬

You

is

can't

difficulty*

second

our

law

labor

administer

this way in the United States

have

and

There can be no
peace under these arrangements.
We have had an enormous growth
of

peace.

the

union

trade

movement in

That

was

a

and

nobody knows the figure.
They penetrated into all the basic
industries and all kinds of occupa¬

tions, but it is still
union is in

people
free

are

in

a

a

country in
labor

of

to

Lots of

fluid state.

unorganized, and notf

their

minds

where

to

as

^yomptly lodged a complaint with

■Jhe

National Labor Relations
^poard saying it was an unfair
election,

It obviously is an unfair
election if the, union is defeated,
so

the

NLRB

number

of

statement
the

pondered

months
it

was.

President

about-

uhipns

v.

and

unfair

said

to

administer the

it

ahd> the




terms,

we

Common

to

tells

-

lor

us

trouble.

that under

fundamental labor economic wage

policy and this putting

a

lative,

a

labor

company

sense

in

circumstances, we have got
remedy that; this making of a

for

because

are

those

issued

something

-

stop

which somehow
going to be settled,

strikes,

other is

or

Broker-Dealer Application

Rejected by SEC
The

of Alexander

application

application,
if
granted, would have limited Mr.
Smith to dealing in securities with
other registered securities deal¬

mission,

political
in

legis¬
toward

our

policy

•

;

The

OF ELECTRICAL

FRANKLIN

ENGINEERS

GOLD

JOHN

MEDAL

FRITZ MEDAL "

fOUR

INSTITUTE

NATIONAL) i i V

SCIENTIFIC SOCIETIES

m-

:

Milesiones

Medals

banks, insurance companies,
corporations, and other financial

ers,

institutions.
»

-

n

v

'\V N

;

Kg

v.v^rj

found

Commission

The

during

a

eties have been

period under survey by

discoveries and

inventions.

ings with customers showed "wan¬
ton

presented to staff members of Bell Tele¬

phone Laboratories for their scientific

his deal¬

its staff the applicant, in

awards from .learned and professional soci¬

More than 50

,

that

disregard of his responsibil¬

Awards include the Nobel Prize in Physics,

ities," charged "exOrbitan^^^^ varia-.
from

tions

.

prices," and made "unconscionable

profits."-

1

' ■

* '

Medal, the Franklin Gold Medal of the

,

Richard Shillinglaw
Richard

Shillinglaw,

of R. A. Shillinglaw &

ville, Tenn., died in
pital

after

weeks.

an

a

Dead

Bell Laboratories scientists
every

Co., Nash¬

of

scientific field which offers hope of bettering com¬
That is why Bell System research is so

important to the

several

He pwas 53 years old.

and their associates explorer

munications.

Boston Hos¬

illness

1 casting, as well

Mr.

as

future of sound and television broad-v
ever-improving telephone service.

to the

Shillinglaw organized the Amer¬

order, isn't anything we

ican National Co. in Nashville in
going to do overnight, noth¬
going- to do overnight. 1920, one of the earliest invest¬
We are hot going to settle this ment banking house's ift the Southi

Gibfe

Franklin Insti-{

John Scott Medal.

tute, and the

President

the Hughes^

Royal Society, London, the Willard

Medal of the

market

prevailing

BELL

are

ing

FRANKLIN

FARADAY MEDAL
INSTITUTE

basic

labor law of this country in these

:

second crime, and it

of

4*«wC

this country from something like
two million to twelve or thirteen,

continues

,

thingK and

No Peace Under Wagner Act

That

the UAW,

secret ballot.

:

chage- Act, has been rejected by
the Securities and Exchange Com¬

they stand or what they- want.
Now, as long as the Government

a

this

to;

Smith, of Devault, Pa., for ? quali¬
fied registration as a broker and
dealer under the Securities Ex-

posal and called an election, and

CIO, was defeated in

minds

worrying about this present wave

they didn't like it
and thought people ought to join
something else.

meant was that

which? the relations

and fi¬

uproar

National

,

thing in the history of the West¬
ern
Electric independent union
that justified, in its own mind,
that it was an unfair union; a
company
dominated union, and

we are

'i

TELEPHONE

■MM-S:

1

SYSTEM
b:

THE

852

COMMERCIAL-& FINANCIAL CHRONICLE

Thursday,- February-I4,-1946~

decision rested first upon

Needed: A New Labor Policy
page)

(Continued from first
You

all

Congress

that

know

We

is

today—extreme bills
and moderate bills, short bills and.

full

of

bills

lengthy ones.
The extreme bills
carry
what people describe as
compulsory features.
They want
to end our present difficulties by
compelling somebody or other to
do something that they seem dis¬

to

inclined to do and there appear
be

people in the United
of mind to¬

lot of

a

in that frame

States

Other

ma¬

machinery.

fact-finding

already full of machinery

are

which

ones,

kind of

set up some

chinery,

have

we

multiplying

been

pretty rapid rate in the last
10 or 15 years and the great prob¬

at

,

a

lem in this country seems to me

to
be to absorb that machinery and
digest

assuming

it,

retain it.

to

want

we

limit

and

if

even

lend itself

it

appeared

to

that kind of treat¬

to

ment, I doubt the wisdom of that
of

for

solution

the

and

"

opinion

my

its

reasons

I

twofold.

are

don't think compulsory
will work.
>

legislation
y"

®.

■.

longer to
to
private

any

discussion

We

have

tended, I think; and
realizes,
to
become

everybody

lawless

more

in

labor

We have become

in

mental decisions that

make

we

as

taxation, as to public debt, as
prices, and they are inextric¬

ably intertwined.
rate

them

longer,

any

lieve

what

dress

You can't sepa¬

ourselves

have

we

be¬

got to ad¬
this highly

is

to

I

so

difficult

question, highly difficult
undertaking, of trying to bring to
the surface two things about our
labor

problem

remedied

if

which

we

The

one

policy,

our

What

need

to

be

the

in

propose

future to deal with it

sensibly and

,

question is our labor
labor economic policy.

has

this

policy ® been?

spite

of the fact

nnd

adopted

terms?

® The second question; is
policy as to law and adminis¬

our

tration in the whole field of labor

and
I
want
to £ talk
briefly about these two aspects of
the question.

that

passed

we

in

1935

which

after

policy of

a

all

labor

reduces

policy,

itself

to

The American

wages.

whose primary objective it was to
labor relations to peace¬

public policy toward wages.
We
now have a public
policv toward

ful negotiations,

wages,

reduce

peaceful and

ra-

good

llonal

unworkable.

1935

think

negotiations, and yet since
have become increasingly
lawless.
People who approach
we

.:

these issues in
mind
nnd

lawless frame of

a

not

going to submit by
to-compulsion, and if

are

large

,

to deal with this

we are

of ~ lawlessness—and?" I
back

come

got to

take

of view.

it

to

problem
have

longer range point

a

®®;®

,

to

mean

later—we

secondhand I think the
major difficulty about compulsion,
Is when you start

compelling one
party to do something, you com¬
pel everybody.
Compulsion isn't
anvihing
held

that

within ;

be

can

limited

or

narrow® area®

a

or

13

or

eral

certain

a

labor

type* of .adjustment

then:

you

Of

in \ the; industry,

disputes

® the

open

way:' for
regula¬
tion c-v all business activities, all
businp-s decisions, and I think the

thoroughgoing,

complete

greater"

danger about this compulsorv legislation, these proposed

at

a

using

it

I

at All

regard that

as

going
only
but

to

compel,

skeptical
roment

we

and

worse

not

are

I

about

enacting any

the

If

;

compulsion

kind of law at

simply

because

we

lot ready for a law, and poor
laws are worse than no laws at
an

then

eJJt
do°

to

what

That

isn't

answer.

Vo-t

see

for
r

and

you

be

and

stopped,

under

is

we

e^sy

like

do

is

all

inflation.
see an

unfolding

there

argue

is

left
it

about,

things would lead

inflation

which

ought to
of

pro¬

rate.

reduce

form

or

,




,

.

and

authority

or

John

Wage rate
the

eco¬

to

want

keep stable

or

the

thing

sumer

or

determines

rate

wage

called

this

purchasing

total expenditure,

con¬

® expenditure,
to occupy a

which
part in the

nomic system nobody
it occupied before.
The third

at

up

invoked

the

spending
From

related

1939

to

billions

cool

and also
money.

I

don't

results

know

in

how

is the theory we

appeal to help
your mind whether

the middle

not.

or

The

have is the
ard.

make up

you

only

has
eco¬

knew

ever

®

part—and this at the

over a period
"This was our theory.
We put it into effect and exploited

didn't,"

or

reasonable

I

don't think

man

look

can

know

we

The

what the

record

is

the

of

cent

per

know

before

when

we

lines

along

we

far

so

the

on

have,

the

standards

would

record

that

tween

the

wages

doctrine

other

is

separation

and prices.
that

seems

an

be¬

That is
to

moti¬

vate Mr.

Bowles, for example, and
of our influential public

many

officials at this time.
at

that

have

If you look

doctrine, you can see
applying it.
We

been

plied it when
form
with

we
or

the

wrestled in
under

question

be

the

were

•

The United /

pay.

it

fact

the

with

and

all

these

policies

is

:

■

.

y

;;;

are'®;
®

y y/

■.y

-

®®

wage

which

bandied back and forth.

,.//

..

.

The Fallacy of Interf erence in
Collective Bargaining

,

One of the difficulties with the

wholesale

con¬

got

one

to

will have to

we

of

cost

tinue

settled

the

to

any

if

and

more

'

of • the parties:

one

is led to believe in the

related

and/

terms,

you can't
contract or you can't •;
difficult negotiations to?;®

termination

negotiations .if

of:

course

he, doesn't

settle,

and waits around and does

some®

;

thing spectacular,;he can appeal.®
an agency somewhere that will

should

of

sorts

any,

bring

of

get into difficulty
and having started /with. ;a simple
idea,: it got itself involved in ail

we

moderate

by the two parties them-' ®

interference ;but

settle

inevitable the Adminis¬

was

tration

,

selves if there had not been out-?
side

con¬

control

in

settled

®

prices.

the.;?
ever

presented in this country. They could have been settled and®

con¬

at

of

some

disputes there

wage

were

We won't successfully
without the
other,

wholesale

a

-

easiest

the

make

industries

these

The ^Ability to Pay" Problem

seem

capacity to

theories

was

assuming it is desirable to

®

1

they

adjustment, and that is going to;

in

pursued when we

to reasonable

prove

sort of

made two decisions.

war we

I

we

ap¬
an¬

another

of

full

employment

from 1933 to 1939.
We didn't call it full employment

then, bpt. better employment and

cies/adapt
times.

doctrine

a

their

trine

;,

to

give

him

deal.

better

That

is/®®

what hanpened in this country.

com¬

® ':

a

® Why should anybody sell or set®
tie for 15, 12 or 13 cents if he®

trine

talking

ideas, and
war :

of

the

t

system

of

decided during the

we

that Inflation is promoted by

these forces; one, a great
in
income, expendable
and in the face of

a

increase
income,

great shortage

of goods.
That, we said—and I
think correctly—-yvouid lift prices

and

continue

to- lift

them

unless

something was done about it, and.
secondly;
forces which
tended
constantly; to raise costs of doing
business,
costs
of
production
would be added, to this first force
and encourage

inflationary rises in
prices at a faster rate, ,®® ®
;;1
That is; the view we held during
the war, putting aside whether we

administered

it

properly of not,,
and we were holding that view in
1941 when prices began to
go out.
Prices are misleading and decep¬

tive

unless you watch them very

carefully.

When

prices went up
month, and the cost of
everybody got disturbed,

seemed
was

There

was

an

admission

that- in

that
order

regulate prices you have got to
regulate the principal items-of
cost.
It was a- public admission,

t

and

everybody

cause

agreed

it seemed to be

to

one

it

be¬

of those

simple economic truths which

we

retained anyhow until the middle
of

*1945./g!g<

The

had

when

to

nomic

the

decide

war

made

was

upon

policy, a labor
policy, and that decision
and

■.

Post-war Policy Unworkable

Nov/
we

'

an

over

eco¬

economic
was

made

wrongly in the middle

of 1945,.. Let's see what it was. That

of

the

theory

a

would

Machinists'
Razor

the

asked

last

A

no

can

-

are,

be-®®

read

couple of days that fact
dawn on: the Ad¬
,j

,

j:

®

1

,.

,

a

in

increase

Under

Then

Labor

it

10

went

and sanguine
I

in

Board

New

kind

of

unthinkable
increase

hour,

an

for.

it

out

came

decision,
decision.

should

a

the

a

•

will

be

fancy

a

out of the reports in Wash¬

had is

one

unworkable

an

unworkable in
different
talk

;

policy and

great number of

a

directions/ which I can't

about

for

now

lack

of

time.

the

;;®'® The Wagner Act

York

with

be

16

The

second

®®y:® J®y

difficulty,

derlying one, is
legislative

an

un¬

political and

our

policies.

>

Unless

•

we

1

to grins with these

come

cents

increase nobody had
ways of these

trouble

f

mys¬

but

a

and

trouble
I
i

tied

not

prolonged
in

which

political

small business of the

situation

Govern¬

short

period,

of

labor

things get

set,-

quite knows what the

issues will be.

States

a

period

®

and then break out again,

and nobody

the Pal Razor Blade

United

'*

now
a
general understanding in
Washington that the policv they;

10-

■

Company,

.

ington, and that is that there is

but the

was

;

'

perfectly I and legislative policies we are
They said | going to have a period of labor

policymaking agencies are
terious, you know.
®y®
Here

®

to what it will be;

as

afraid, it

am

comes

wrestled

with

wrestled

-V-

general revision

thing nobody will understand, but
one
thing is clear from what,

to

with
this
conundrum for about eight, or nine
months and then after they had
and ; they

of

of the wage policy of this country
is under way. I am not optimistic

cents

to

Way
-

Some kind

wages,

five cents,

offered

Policy /Revision

Wage

;yy:v//; y

Pal

the

Company for

hour

hour.

type

I

had

economic-,

<

have had

we

If

ministration.

capacity to pay
look
like.
The

between five and

erence

,

those

or

is beginning to

American puzzles
incapable of solution—the differ-

an

either

tweien the lines in .the reports that;
appeared; in the newspapers in;

of these typical

asked

have

clear, labor

policies

their

tried

and

Union

Blade

an

they

the

We

unworkable.

window.

about

period

imagine what

this

ac®

he is

.

nost-war

War

the party

or

clean-cut,

in the Gov¬

cases

records

'

he®

;

cies.1

Take, for example, a plant in
Plattsburg, a great industrial cen¬
ter of New York State, the Pal
Razor Blade Company.; It was
organized
by
the
Machinists'
Union during the war when Govr
ernmental, authorities
had
not
projected
themselves
into
the

an

if

publicize these problems of
underlying labor economic poli-®.,

capacity to pay
system before they

classic

are

mind

argue,

which

pay,

The Administration

/out

views.

and

and

it

ernment

living,

Formula,

to

think

good

a

threw

cent

Steel

Take the doc¬

capacity

to

his

customed; to I bargain •: with® but ®
with

Fact-Finding Board and the Ad¬

month after

and at that time we conceived the

employer

their

General Motors tried to fight out
with the UAW and the Garrison

ministration.

in

back

official
somewhere®*
way about a
else?® We have come to grips and ®
when the doctrine 1 have
to
explain and
explore®

has another effect.
of

about

to

so

it

waited long enough he could make/:;®'
a
better settlement, not with his

the

to

one way

and

so

I

has

day when the doc¬

one

does

doctrine today

am

views

They feel

talking about whether
they were well administered, but

not

to'

or

time.

control

evidence,® by any

sense

It

because

a

major items

same

Hit

very
widely
accepted
inthis
country and. in England—is-'that

a

decision that

The "Little Steel". Formula

So,

have

we

trol

proceeding
different from

adopted these theories.*'1

common

on

of

then

we

as

.

Gov¬

Razor Blade Company, one of our/;
small businesses, had to make that *

prices, and I haven't time
to talk about that, but if we de¬
cide we wish to continue that,

were

quite

those which

Little

somehow

trol

unemployed, not at the depth
of the depression, not at the depth
of a world-wide; extraordinarily
severe depression, but at the peak
of a business recovery.
That was
a
unique
phenomenon jin
the
United States; one we hever en¬
countered

States

a policy' of:
wage-fixing, and that policy of ®-'
wage-fixing transcends any other y
fact or condition, so that the Pal®®

sometime; or* other
going to get out of

want to continue

Fif¬

population

our

United

.

record shows.

bad record.

a

and

cents ;

general theory which we have ' >;
less; we revise or change our evolved is it hasn't worked and ®
underlying economic labor policy has
precipitated strikes.
When;
and arrive at the correct policy.
the wage
movement got under We have to make up our minds
way sometime last summer and
about a very difficult thing and
came to a focus in the fall, we:
make up our minds whether we
had in this country in.most of.

any

at

with

It obviously

failure.

to

not

are

16

and the deci-;

these present labor difficulties un¬

period 1933 to 1939 and say that
we did not fully exploit these doc¬
trines of purchasing power, and

present time is the most important
of this prevailing doctrine,

there

correct
we

You look back

the

was

ernment—and

wages

embarked

1945.

failure

to

to .the

as

spokesmen for the United States
Government—is .not
concerned

unworkable and because it is in¬

say,

part

independence,

doomed

stand¬

sense

of

doomed

was

policy works
standard you

a

common

sion

dergoing'the necessity of at the
time raising prices, and that

Reuther talks about to which you
can

/®

Labor

both

decision

same

arithmetic of the kind Walter

any

War

and retroactive pay,

raisejd without the country's'un¬

isn't

There

•

as;

Board, and:..
experts there finally made a

the

could and should be substantially

gauge

you

economics.

provision,

States Government has

stantially raised, and that

equal, if not in excess, of what we
spent to finance World War I. ' ;
v

point,®

some

That stayed then with the

National

Wages could and should be sub¬

about

hour to

an

back-pay

a

well."

to 'this effect.

in

spent

we

amount

an

of

device

Government

1933

rapid

a very

during that period

carries

,

we

f

clients, and another

theory, whatever you want
it, is that determination of

to call

which

to

these,

in early 1942 because the decision

a

am

wage rate, depending
you want to ha open in
economic system.
The sec¬
part of this doctrine, view,

belief,

degree

in

all

We

of 16 cents

see

the

annealing

like

you

policy, and it is difficult
which; prospect weighed
more heavily in the minds of the
policymakers.
•,'
€®;1y
f
Because of that conflict of view,
conflict of opinion, and because
of political forces, very powerful
political forces, we had really
begun to augment them all during
the war, the Administration issued
its statement of policy, and it was
to

to. help

accept the 16 cents,.
but we can't agree to paying re-®.
troactive pay back in the amount

deflation,

going

what

on

name

some

a

setting.; Without

You raise

be brought

another, and the labor problem is
this sort pf a problem.
*,

in

are

we

egulate the economic system, you
regulate it at the point of wage

other

ought

now

One part is that the

to

encouraged

control

ought to
question

You

movement

about

to

further

moted

an

It

rid say certain

to

it

the problem.

i u'ationary
j'sflf

is

more

the

less

and

totally,

used it again

r

not

am

once

people
in the

many

much

inflation

men that that
thing doesn't work. During
the
war
we
passed to another
phase where again we were con¬
cerned about inflationary ; pres-r
sures
and- argued out the infla¬
tionary phenomenon and during

what

1939.|i In

is the moving force .in
nomic system.
If you

come

much the

of these two evils.

we

right.

plex ideas, the idea of capacity to
pay, and things of that kind,, and
as always happens,
political agen¬

~

power,

-®;®

.

Let's

M.
Keynes and other people in this
country who happen to be his fol¬
lowers, you; can eixblaiix this pol¬
icy pretty easily./ The parts of it
Amount to this.®<

vague

Poor Laws Worst Than None ®:

r

see

1933 to

technicalities

the

.

the

v/:®'

up

policy and

it from

different

operations

all of its business

rate,
its mind

any

policy is correct,

modified form

ond

and

made

from 1939 to 1945 and

better begin to
itself fdr continuing and
growing regulation of all of its

decisions.

have

this

used

we

in

country

rate

.Fed¬

our

at

through its various phases because

your

prepare

1933

it is and what it has accomplished

Compu'~ory statutes, is if they are
enacted. if they come into
effect,
then private competitive business
this

to

this

into

Once you begin
machinery that compels

a

since

years

that

+a

Utility industry.-

to

is

administration,

seems

sphere

to ret up

mistake

It

policy originated in
August or after-the war. or during
the war.
It is a policy we have
been flirting with since 1933 and
through the passage of these 12

of

and we know the history
something approximating com¬
pulsion-; in the ; so-called /public

or

this

look

®.

The

bad, workable

or

make

that there

was

Our Labor Policy
our

doubt

stepped wages

teen

Now let's take

I

and

adopted that policy of wage rate
fixing from-1933 to 1939.
We

it

policy

period this theory

this
general
public of the United States, who

in order

reduce it to workable

that

very

and

relations.

statute

a

evolved,

Where is it leading us?
What do
we
need to do with this
to

If

deflation.

and

.

wanted

years, and they didn't know what
to
do
about
it, and, said, "All

going to be awfully hard to

realize

I believe,
importance or equal
importance the most funda¬
now,

in

inflation

it is

in

in

policy

ment

that the United States faced both

labor

rather

room,

labor

condition

a

available

both

are

transcend

the

face

I think it is the great¬
public issue of the United
States./ The decisions>we make

lawless in

more

which

under

supply came to be absorbed into
employment, and in that theory,

est

relations,
Lawlessness in Labor Relations

approximation to

an

meetings.

I don't think it

ours.

lends itself to that kind of treat¬

sort

afford

I am no believer in constructively.
solutions of this labor

magical
problem of
ment

can't

we

to

bills, the moderate

want to

We

think our way
through and we have got to think
our
way
through it in public.
This problem has grown so big

to

day.

have got to

conflict¬

ing notions, and they are still in
the atmosphere.
The most im¬
portant .conflicting
notion :was

of

When you have a
kind- you court

this

labor trouble and invite it,

®

®

Let

me

the National Labor question or even approximate the
a second handling of it by hasty legislation
election, and then they had the drawn up with some little specific
second election after a period of end in .view.
time during which electioneering
Measures Taken to Assure Bona Fide Ownership of Securities
;
Review Our Labor Policy*
was carried on.
*
■'
' ■
• *
Brokers to Accept No New or Unknown
/We have got to review our labor # in all Transactions.
; The President spoke to his em¬
Customers and No Free Money to Be Used for Trade in Old Securployees, and the union was again policy, the policy of the Federal
defeated.
This made the situation Government toward labor on a lot

and

word about the

a

say

himself,

Trading

so

Relations Board ordered

policies.; You all know that the
great basic labor statute in this
country which governs labor re¬

a
popular Act.
It won public
opinion and popular support.. Its
.

aim;; was to

redress

after the first defeat.

bers

on one

side and in¬

dustry; and the Wagner Act went
Whatever the

into effect in 1935.
terms

there
on

of

the

is

I don't think
piece of legislation
Act,

any

the statute books in the United

has been so poorly,

States which
so

any

this

arbitrarily administered as the

which

disabilities

removes

from

a

the other

Good

;

or

Western

■

Electric had

a

is

these may

be made only from one

Each member of the Stock Ex¬

se¬

curity sold through his services,
belongs to a previous owner and
was
not bought through regular
stock exchange bhahnelsl the As¬
sociation refunds the sales price

got to be dis¬
The facts have got to be

cussed.

If it appears that the

tomer.

party to it.

a

interior bonds and

of

sale

;

transactions

,

We have reached a lawless state

has

thing

the

of Finance

Ministry

limit stock exchange

the '<

by

to

it, and there is no authority to

This

Netherlands

.

issued

mortgages,

call them' for it.

and Government

.

.

Regulations

sulting from illegal sales.

mill or a mine inaccessible, they

do

and, in

turn

claims

the

*

amount

brought out and the thing for paid: from the member* of
Stock Exchange.
Congress to do is set up a joint
also

formed

a

the

association.

new

another. No

free money may be used

in old

these

that

to

securities

as

for trade /

it is essential

funds

free

for

payment

while

blocked account into

applied /

be

capitalization and recon¬

new

struction/

'

<

.

In' order to promote investment
of free money,; the

■

government is '

issuing negotiable savings certifi- /
cates

have

Amsterdam stock brokers

themselves to this American labor

bearing 2%% interest. As a *

savings *

further inducement, these

One of its conditions of member¬

certificates may

ship is that each candidate must

ment of

pay-"

be, used for

special tax levies and in-

problem which, in my; judgment, also be a member of the Associa¬
is a continuing problem. I don't
tion for the Trade in Securities.
think any of the; present settle¬
ments settle the future of Amer¬ Brokers refuse for the time being

heritance

ican labor relations.

•

of 300 guilders.

employees. /We don't like your
pendent union, and the United
staying out of a union. We think
Electrical and Radio Workers of
you ought to join this one," or if
the; CIO wanted those members,
they joined one the Government
I don't blame them.
It is a val¬
is put in a position and exercises
uable property, and in a com¬
the power and influence by say¬
petitive, system you have a right
ing; "We don't like the unioS you
to bid for a property, which:-is
are in.
We are going to force you
what this is/ Stripped of all its
to join another."
language, it is a bidding for prop¬
Here is an illustration.
There
erty.
One of our most successful
is a big plant in Cleveland, and a
bidders is John L. Lewis. : He
well-conducted
business
of / its
bids for
properties.
It doesn't
kind—good
working
conditions make a difference whether: you
and rates of pay, all of which are
call it labor property.
It is a
irrelevant to our labor relations
property,; all right..
.
today.
Our aims are in: some
They sta rted to bid ih Kearney
other
direction.
This
is
the
and
Sparrows Point, Baltimore,
Thompson Products Company, a
and when you don't; get anywhere
well-known plant.
It has been in
in open bidding you go to Wash¬
litigation from the beginning of
ington and say you have been un¬
time, which is 1935. What is the
fairly treated,^ and the United
litigation about? : It is a- very
Electric and Radio Workers went
simple human relationship.
to Washington and made a com¬
| Thompson Products employed a plaint before the NLRB, and they
given number of people. It is one pondered that and found some¬
of these large-numbered mediumthing in the history of the West¬
sized firms in the country^ and
ern
Electric
independent union
organizers
went
forth,
sallied that
justified, in its own mind,
forth to bring these people into
that it was an unfair union; a
the UAW, CIO, a well-known de¬
company
dominated union, and
liberative
organization,' having declared it
disestablished,, which
today something like a million means
putting it out of business,
members( in; control over
large destroying it because it was com¬
segment of American 1 industry.
pany
dominated.
What
they
T.hey weren't successful in their meant was that
they didn't like it
organizing activities and that to¬ and
thought people ought to join
day has become in the, nature of
something else.
.

.

for

change must guarantee the bona
pull out a city, if they decide fide ownership of each security
make; a building or a plant or placed into his hands by his cus¬

to

inde¬

an

the decisionsonly after the Associa¬ not accept, orders from unknown
the Trade in Securities persons. ■
, '
;,, ><
•
■. ,>.

ciation to underwrite all losses re¬

Congressional committee of good
people, able men, and give them
elec¬ six months, or a year to address

as

securities,

and

party on labor tions are and as much as Amer¬
relations or both parties, but this
icans like to vote,, they get tired
goes farther and makes the Gov*
out by them after awhile, and
ernment
an
organizing agency,
pretty soon let the union win to
puts the Government into a posi¬ be rid of elections.
tion where it says to a group of

one

tion

standards

no

in

made

was

threatening to do in New York on

U. S. Court and they

series of them.

have

We

trade

enforce

to

From Reconstruction.

When the Netherlands Government early this year permitted the
reopening of the Amsterdam Stock Exchange and the resumption of
;<

Monday, and pull out people with
no
grievance ~ under 'collective
contracts
with their employees

reversed
Let me tell you what you can
the decision of a lower courts and
do under the Act by way of illus¬
he talked again,, and again in a
tration;
The; Wagner Act makes third election the union was de¬
it possible for Government offi¬
feated.
If anybody thinks that
cials to organize unions, a wholly
ends that episode, he is wrong. I
new function.
That is quite dif¬
am willing to wager that election
ferent
from
the
Government
is going to be declared an unfair
passing a statute administering it, election and there are going to be
one

'/ ities in Order Not to Drain Capital

one

Nobody

had: declared its willingness to
this country
hold
itself
responsible
for
all
in labor relations.
If a group of
transactions.
A fund
of 400,000
unions decide to pull down a city,
guilders was raised by the Asso¬
as they did in Stamford, and are

stop Mr. Crawford from

right to talk to your
Wagner Act has. As long as that
situation prevails, you can amend employees and tell them what you
think about things, and the right
the Wagner Act, you can rewrite
talk; is not limited to the repre¬
it or write new laws/ and we will
sentatives of One side of this very
not drag ourselves out of these
heated and difficult controversy.
difficulties, and that is the prin¬
; Anyhow,; Mr, Crawford went /to
cipal problem of the Wagner Act.

mention

me

of force any more in

to talk, some

;

Revives Slowly '

through.

undertakes

law.

the

Amsterdam Stock Exchange

on

*

.

longer under the labor law of
country, with very few ex¬

ceptions,

talk¬
ing.
Finally, there was a decision
from
the U. S. Supreme Court
which said you have got a right

to

Let

and then I am

This multi¬

plication
of. defeats is simply
something no one can possibly ac¬
cept in a democratic country, so
it again complained, and this time
the NLRB went further and tried

existed

thought

people

of

.

fronts.

of

unfair than it had been

even more

a

lack of balance which great num¬

between labor

.'

-

lations, and has for the last 12
years, is the Wagner Act.
Now,
the Wagner Act, I should say, was

principal

8SJ

FINANCIAL CHRONICLE

THE COMMERCIAL &

163.,. Number 4464

.Volume

>

,

.

accept new customers and do

to

,

the '

Moreover,

taxes.

certificates may be

purchased out
to an amount

of blocked funds, up

get worse
there will
come periods of quiet, but when
we
talk about devising a fur¬
nished labor. policy for this coun¬
try by statute and administrative
orders and regulations, we are
talking about something which is
important for the' future; of the
economic system of the United
They

likely to

are

rather than

States

better,

about when

talked

we

as

so

the

for

^number

committees
studied

Congressional
of

years

the- Am^ican banking system; and
out of .that seems to have devised
the Federal Reserve System. This
Is the same kind of problem. It is
a
basic
fundamental, issue
in,
American life, and we have, to do
something about it and know what
we are about,- and the ;only way
.

,

"

'

JOHN

'*

SCOTt MEDAL"

J

\

MEDAL OF THE * >

'

ROYAL PHOTOGRAPHIC

CITY OF PHILADELPHIA

THOMAS ALVA EDISON MEDAL
AMERICAN INSTITUTE OF
ELECTRICAL ENGINEERS

-

SOCIETY

GREAT BRITAIN

'

*

draft satisfactory

to find out and

?»

legislation is to have a responsible
legislative
committee
of % both
houses
of
Congress
put
their
minds
to
this
thing - and stop

■

H;

/ //;

;■//

/•//

*//

:'\~i'<•'V

/;/://■■/

•

:

■■

'/

.

;

1Vi•'/■>•/

V'"

,;//
i;;:

/':/

■|J;" *^-;W?>:&■

worrying about this present wave

somehow

which

strikes,

of

or

bther is going to be settled.

,

,

a

crime.

Not to be successful in

No Peace Under Wagner Act
organizing activities is one of the
high crimes of American law.
That is our second difficulty.
Anyway, they persisted in the You can't administer labor law
thing and in one of their cam¬ this way in the United States and
paigns the President of Thompson have peace.
There can be no
Products, Mr. Crawford, thought peace under these arrangements.
it was within his rights to counsel
We have had an enormous growth
With his employees: that is, he of the trade Union movement in
said in substance to himself, "If
this country from something like
an

outsider

in and tells my

comes

employees what is good for them,
I, knowing much more about this
and

business

status; of

,

the

have

ployees,

the

right

to

em¬

tell

them what I think."
.

That raised

an

and fi¬
Labor Rela¬

uproar

nally

the;; National

tions

Board

invoked

the

demo¬

cratic instrument it has at its dis¬

posal and called an election, and
the UAW, CIO, was defeated in a
secret ballot.

-;-•», .,<•

?

-

two million to twelve or thirteen,

and
nobody knows the figure.
They penetrated into all the basic

promptly lodged
the

complaint with

Labor

National

Board

a

Relations

saying it was an unfair
It obviously is an unfair

election.
election
so

the

number

if

NLRB
of

statement

the

the union

it

about5 unions

defeated,

pondered

months
was.

President

is

and

unfair

said

andJ the




it

for

issued

j

application - of Alexander

The

Smith, of Devault, Pa., for quali¬
fied

registration
under

dealer

■?.

as a

broker and

Securities

the

Ex-

FRANKLIN

FARADAY MEDAL
INSTITUTE

OF ELECTRICAL

if
granted, would have limited Mr.
Smith to dealing in securities with
other registered securities deal¬
ers, banks, insurance companies,
corporations, and other financial
institutions..
•
1
|
The

mission.

,

during

a

period under

survey

-

More than 50 awards from .learned

phone Laboratories for their scientific
inventions.
'

I*#,

people
free

are

unorganized, and not

their

in

where

to

minds as

they stand or -what they- want.
Now, as long as the Government
continues to administer the basic
labor law of this country in these
we

are

in

Common sense tells
those

trouble.

for
us

that under

circumstances, we have got

to

remedy that; this making of a
fundamental labor economic wage
policy and this putting

a

labor

political

lative,

a-

because

are

something

ing

company

We

in

legis¬
toward

our

policy

order, isn't anything we

going to do overnight, noth¬
are going to do overnight.

we

are

hot

going to

settle

this

n

"
^

'

""J

C

n»

prevailing

:

market

Medal of the

.

prices," and made /'unconscionable
profits."-

,

tute, and the

'-mmmmmrnrn

Richard Shillinglaw Dead
Richard
of R. A.

Shillinglaw,

pital

after

weeks.

He

a

President

every

was

of

Mr.

John Scott Medal.

1920,
meht

one

of

Co.

the

in Nashville

in

earliest, investi

banking houses ifi the South;

.

/

\^

Hughes/

Franklin InstM

.

-

and their associates explore;

v,

well

future of sound and television broad-'
the ever-improving telephone service.

casting,

as

BEU

TELEPHONE

as to

Shillinglaw organized the Amer•ican National

^

scientific field which offers hope of bettering com¬
That is why Bell System research is so

important to the

several

53 years old.

y'1

1

munications.

Boston Hos¬

illness

an

^

Royal Society, London, the Willard Gibbs^

Bell Laboratories scientists

Shillinglaw & Co., Nash¬

ville, Tenn., died in

^

Medal, the Franklin Gold Medal of the

''si&vi

-

^^

Awards include the Nobel Prize in Physics, the

ities," charged "exorbitant varia-.
7

discoveries and.
,

t-

disregard of his responsibil¬

from

and professional sod-;

presented to staff members of Bell Tele¬

eties have been

by

ton

tions

l/ i

SOCIETIES;

and Milestones

Medals

applicant, in his deal¬

its staff the

NATIONAL)

-MWA- :/;"■

found v that

Commission

The

FRITZ MEDAL

FOUR

"

application,

country in
which the relations of labor to
union is in a fluid state.
Lots of
a

JOHN

MEDAL

SCIENTIFIC

ings with customers showed "wan¬

tions, but it is still

GOLD

FRANKLIN INSTITUTE

ENGINEERS

chage Act, has been - rej ected by
the Securities and Exchange Com¬

industries and all kinds of occupa¬

$ That was a second crime, and it terms,
r

Broker-Dealer Application

•Rejected By SEG

SYSTEM

THE COMMERCIAL & FINANCIAL CHRONICLE

854

spokesman of the Foreign Eco¬
Adiminstration,
declared
that we could not hope to achieve
a

nomic

full

States unless

creasing

United

the

in

employment

succeeded in in¬

we

exports from the nor¬
level of three billion

our

mal prewar

to fourteen billion dollars.

Paid For

Imports Must be

must

values

flow

the

into

back

Not all this return

United States.

flow of values need to take on the
form of imported goods, but a

Apparently in the eyes of some,
an
active export trade now has
become the key to national pros¬

considerable portion will take this
form.

perity and domestic employment.

tle

these conflict¬

We must examine

When in 1938

worth

of

exported

we

three

over

billion

lit¬

a

dollars

merchandise,

im¬

we

ing claims because our conclusions
must guide us in our decisions
with respect to the wisest econom¬
ic policy on the part of our gov¬

ported nearly two billion dollars
worth. This is in some quarters a
certain
indication
that
foreign
trade is of little value since the

ernment. The issue is still further

jobs created by

complicated by
flicting claims.

other con¬

are

almost

^

the

destruction

There

are

two

some

who claim that

foreign trade leads to interna¬
tional goodwill and mutual under¬
standing, but there are others who
claim that foreign trade leads in¬
evitably to international friction,
resentment, fear, and conflict.
This issue also is of
for

importance

export trade

our

completely offset by
of

work

oppor¬

tunity

resulting, from imports.
They reason that the merchandise
imported displaces domestic prod¬
ucts, Thus while exports employ
domestic labor, imports give em¬
ployment to foreign labor and
eliminate
jobs
for
American
workmen.

But

such

reasoning is

tober,11944:

1

•

"Never before in the
nation

tire sections of her big

history of

the

has

fourteen

billion?

The

world

need

is

big; why not aim at twenty-eight

swept

along

this

by

easy-going

optimism,

we must ask some very
serious questions. Will it be wise
to build up our exports to such
unheard of figures? Would it be

profitable?

possible?

Would

it

emphatic "No."

an

'

be

our

■

7y"x

}' J*

V

It would not be wise;

it would
profitable; it may not even
possible.
Our question may

"

The Importance of

follow in

i* :C,'4.

used in this country are imported
and become a part of our finished

will

Foreign

Moreover;

Trade

imported

merchan¬

wake

of

our

of

Figures by themselves have lit¬

were
our

therefore

exports
of negligible
importance to

national life is not correct.

If

take at random

we

during
manu¬

factured products produced in this
country, if we exclude duplica¬
tion* was about $38,500,000,000,
and the value of our
exports of

these

same

products

was

only 7%.

But such overall
figures give an
picture of the impor¬
tance of exports to this

incorrect

country.

When

we

examine the

importance

of

exports to industries that, do
export their products, we find that
some

of them

could

hardly exist

without them.

During 1938 we exported 35 % of
sewing machines; 28% of all
our
tractors; 53% of all refined

our

17% of agricultural ma¬
chinery. When we study agricul¬
copper;

tural

products, we find even more
significant figures; Forty-nine per
cent

of our linseed went
abroad,
43% of all prunes, 31% of the cot¬
ton, 29% of the tobacco. To the
industries actually
engaged in ex¬
porting, such exports represent

therefore in many cases the dif¬
ference* between
prosperity and

bankruptcy. The importance of

ex¬

ports is not expressed only in the
value of the products
exported.
These products must be
shipped,
and

•

unloaded.

workers must

keep

Office

records,

sec¬

retaries must write
letters, banks
and,
insurance
companies
must

lend

stores

estimates

such

and

in

the

of the manufacturers,
are

unreliable

as

have been

estimates

place

the

number

of

men

their assistance.

;

American

Manufacturers

Association

in

1935

Export
the

to

comes

conclusion that the total number
of workers engaged in both ex¬

port and import trade represents
29% of all workers in the United
States.
This

estimate

high but
20

even

is

probably too

if we reduce it to

%^We still

come to the conclu¬
*that foreign trade, both im¬
port and export trade, does mean
jobs to the people of the United

How many men and

women

States.

It is obvious then that

expansion

bring

of

more

foreign
jobs.

an

will

trade

are

ple since

large number of

a

known factors enter into

culations

but

no

one

un¬

cal¬

our

doubt

can

we succeeded in reaching
high mark set for exports by
the spokesman referred to, if we
actually did increase our exports

from three billion to fourteen bil¬
lion dollars, or five times their
former volume, that at the lowest
estimates jobs for some

12,000,000

people could be created

or

about

8.000,000 more than normally; and
if we stick to simple and I
may
say naive arithmetic, we may con¬
.

clude that

we

would thus absorb

guesses

according to similar
will be unemployed by the

end of this year.

be created for those who handled

but

and distributed the

from

about

workers.

method
mine

I

3,000,000 to
know

now

of

available

which of these

correct.

But

no

even

vary

7,000,000
accurate

to

deter¬

estimates

the lesser

is

figure

when applied to the total number
of workers amounts to
no
less
than 13% of all employed in

agri¬

culture, manufacturing, and min¬
ing and transportation combined.




amounted

And
into

that

does

account the

not

even

take

jobs that would

imported mer¬
chandise that will begin to flow
in larger volume into this country.
What

a

tion for

simple and pleasant solu¬
our domestic employment

problems!
for all

keep
shunt

cannot

find

work

our workers, not enough to
them all employed, so we

the

shoulders
shall

We

give

problem
of

other

them

on

to

nations.

employment

the
We

by

Even

Exports
life

It

of

true than to-

to

India

enough

—nearly

War and civilian
;

increased

this

to

supply

$11,000,000,000,7 of

Lend-Lease shipments.

no

not

to absorb

true

with

is

true

industries

we

must

on our

ask

fantastically

of

as our solution ,

such activity
part would affect other na¬

materials

become

month ago I saw in Holland
peo¬
ple riding in freight cars seated
on camp
chairs. And they were

All this

:

means

countries of Europe are faced with

less.

That is the kind of world in

sec¬

The announcement made in this

country that we must expand our
exports beyond anything we ever

taken to Germany and the

were

burnt.

There is not

one

we

reached

will have to operate. 7/

before

has struck terror

in the Ifearts of the governments

bridge that was not damaged or
totally destroyed. The center of
Rotterdam, a city of 700,000 in¬
habitants, is completely gone; only
the city hall is still
standing in

be for the European

the midst of what is now

how much

a

grass-

normal

tariff

reductions

times

in,

difficult

;

4

7

\

i not

raw

^materials- but

manufac-1

very

tions of the railroads are no more
than streaks of cinders., The rails
ties

that

much increased need for itured products4with a-high labor;
The
very
products
exports, the possibility of selling coefficient.
their goods abroad are very much which.it wilLprove most difficult ■
a

which

;were

at present few, if any,
that position.
This

This is especially true since the
: products
which -the
European
I countries are anxious} to sell are |
-that where the

cheerful because at last the rail¬
road was moving again.

Many

that,

in

ments.

the basis

entirely new to that

country.

The destruction, abroad both in
Europe and in Asia amounts to
hundreds of billions of dollars. A

so

pacity to take payment cannot
keep step with these develop-7

a

have

of industries

tions.

only;

currencies,

port trade fairly rapidly, our ca¬

Targe steel plant
built, and the local raw

has been

how

made

whose

enough, may for the present prove
to be practically impossible. At:
best the process will be time-con-7
suming.. This means that while through liberal loans and high
pressure salesmanship, it may be
possible for us to expand our ex-,

have

developed^ Immigrants from
Europe have brought skills and

In Australia

are

more

technical knowledge, and in many

1

be

can

means

ment and with the problems of cases we have contributed capital
overexpanded factories. But .be¬ and mechanical equipment.
a

import- duties,-but this-.

sufficiently stabilized

There

been

attempt it?
possi¬
large-scale unemploy¬

concerned with the

possibilities of
limited; Through the7

countries

countries

And what is

India

this"

prices will not be changed over-,
currency devaluations.

the 7 Latin-American
New

could in

night by

much of the products

British

of

many
of
countries.

are; very

rangements

market at all for for¬

as

We

real contribution to v

a

takes time and such reciprocal ar-*

that there

mean

nations.

make

somewhat

are

This does

Will it be wise to

accept
large export trade

i

our tariffs, but, the
is of necessity slow andshould be slow. A careful study of,
specific products and of compara¬
tive^ costs may in many cases re-7
veal
possibilities
of
reducing:

The

will be

shipments we attained
giving things away.

we

considerations

,

fore.

Shall We Boost Exports?

.

these

process

her

formerly imported.

fore

if

able to lower

output of textiles in 1944
eight times that of before the
war.
Pharmaceutical
products,
shoes, a large variety of civilian
goods, are now produced in far
greater quantities than ever be¬

we were

of

..

extended Reciprocal Trade Trea-' ;■
ties Act we have a method, avail¬

demands.

volume of

bility

t

••

.

.

world recovery.
But the practical

eign products but it will mean
that the market will not be able

are

-.■■■•

■

the revival of world trade and to'

its

$3,000,000,000. It will there¬
fore require very special effort to
equal on a commercial, basis the

We

•

our

way

was

commercial shipments
therefore
somewhat
less

when

.

our borrow¬
and the lack of foresight of oup4
Sound business requires;

other

easy

export.

steel production to 1,500,000 tons

Strictly
were

be

not

British

rate.

cent war.
In 1944; our exports
amounted to more than $14,000,-

but

will

.

a very clever and
economist to determine
from these figures exactly what
the relationship is between na¬
tional prosperity and export trade.
To be sure, we have reached an
even higher level
during the re¬

were

•'

ited by the

the

for these
Their old
markets are no
longer as diependent upon the importation of
foreign manufactured goods as
formerly. During the war years
the non-European world has be¬
gun to industrialize at an amazing

It would take

these

'

'

to the recklessness of

the

are

raft

was never more

countries

daring

000,000,

■

would enable others to pay us and:
therefore to buy from us arid'

to

000, or less than they had been at
any time since 1905.

the

made

estimates

exports

But this high point
maintained only for one year.

that if

actually employed full time or
part time in making and distribut¬
ing these exports is impossible to
estimate.
Attempts
have
been
these

our

•

Expansion Not Profitable

has

$8,228,000,000.

than

The arithmetic will not be sim¬

all those who

-

The largest volume of exports
have ever reached was in 1920

we

when

■:

Die"

meaning. When we set these
figures alongside some
figures of the past, we shall gain a
better perspective.

and women engaged in the han¬ was
dling and distributing of imported
The very
next
year
exports
merchandise close to that engaged
had declined to a little more than
in export trade.
one-half the 1920 volume. By 1932
In fact, a study made by the
they reached a low of $1,611,000,-

sion

i.

loaded,

but

made

of the

one

prewar years, we find that
1923 the total value of all

the

fleet

•

exports be definitely iim-.
capacity to pay on the
part of the purchasers and by our.
willingness to receive payments.
;■
By Opening up the American^
markets to foreign products, we

Again,

that

of

storerooms

merchant

the

that

clusion

shelves

'*

we

only hope
country.
Through exports a normal eco¬
nomic life may again become pos¬
sible, through normal imports.
And so the old motto "Export—or

pie.

—the

them, to sell them, to
place them ultimately upon the

Are

lenders.

to transport

our

contrib-7

incapable of solving our domestic 1
problems without contributing to v

the immediate comfort of the pep-

exports
amounted in prewar years to
only
10% of our total production is
statistically correct. But the con¬

that

to

us

ute to this all-out battle?

ers

theoretical

claim

the

Will it be wise for

ing of an export market is of more
importance to the country than

present domestic production prob¬

tle

The

tition

v

dise needs labor of various kinds

-

the',

•

lems.

the

all

scene of !
cutthroat compe- 1
world has ever seen.:

for have no weight with us, we may
their
necessary
imports,
they be willing to restrain our efforts;
must therefore depend more than if we should discover that in all»
ever before upon exports.
In the probability an excessive foreign
trade expansion will not prove
case
of
Holland,
imports
are
strictly controlled by the govern¬ profitable. A normal volume somement. A limited quantity of food¬ what equal to the prewar volume
stuffs, an
even
more
limited can probably be carried on on,
quantity of clothing are allowed sound business lines without arti¬
ficial stimulus but when we set 7
to be imported.
For the present factory equip¬ our sights as high as has been sug-;
ment and industrial raw materials gested, we shall be compelled to
resort to methods of doing busi¬
are given priority and so, many
factories are at work to produce ness which may not be sound,
Everyone can see readily that.
merchandise, not1 for the local
if we are willing to make
population, but for export.
large
The people will have to get loans, we can export. Our export
along as best they can. The build¬ capacity will then only be limited

not be

manufactures and foodstuffs.

national
-

'

'

show

to

severe

If these countries are to pay

.

•

begins

promise of becoming the

been sunk.

each

with

;
V

war

half

Unfortunately I must
of these questions

answer

be

-

■

be

indeed

will

the international
struggle, to con- 7
imported far more than flict and friction? Can we expect 7
they exported. The excess was that countries now struggling to •
paid for by the earnings of their pull themselves but; of the mire ;
merchant marine, and by earnings ,by their own
bootstraps will pull7
from foreign investments. A large us out at the same time?
77
proportion of. these foreign invest¬
7 Excessive Foreign Trade
ments
has
been liquidated and

the

allow ourselves to be

we

collabora-!
in the 7

There

as things
stand now.
7
international
economic;

.

wprld

•

nations

field."

the most

machinery and raw ma¬

new

all

r

' J

which there

"fullest

between

The

terials, and her people need food
and clothing. Most of these coun¬
tries
depended
upon
imports.
Great Britain and Holland before

billion?

Before

cities are

The railroads are in poor
condition from the heavy work
they did during the war and from
lack of proper care. Her factories

opportunity
products
globe;"
Here indeed is the highway to
national prosperity.
But why be
modest
about
it?
Why stop at

our

be -the

markets

gone.

been so great to sell our
to countries around the

,

in

very little that will look like economic cooperation in the world's

suffer

not

:;,4,

.

deal.

cooperation.
In '
Charter
we
were '

world

a

economic

from German occupation but en¬

1

.

did

Britain

Great

disman- 4

economic

Atlantic

would

Great Britain

more urgent fallacious.
establishing of a lasting
Many of the products imported therefore have to be rewritten.
Peace has always been de¬ are non-competitive and create to Not; How much may we succeed
sirable; today it is an absolute a sense a market which did not in exporting? But: Howmuch can
necessity. One more war like the exist for domestic products. More¬ we afford to export? This requires
last one, with or without atomic over a large
percentage of the further explanation. *
I do not mean to say that the
bombs, and there will be nothing foodstuffs and industrial raw ma¬
left worth fighting over. Lasting terials we need are not
produced figure of say fourteen billion ex¬
peace has become the most urgent : in
sufficient quantities in this ports will never be attained; but
and most important concern of all country or cannot be
produced at it will require very special effort
peoples. It has become a matter all. Without them many of our on our part to achieve it in the
c&economie and cultural survival. industries could not produce any near future. We shall not achieve
Which of these opposing claims goods. From 20% to 25% of all it in time to meet the unemploy¬
is correct and what in the face of factory raw materials
normally ment crisis which many expect

the facts should

can

tion

peace;

policy?

about

Position of Holland and

C. Crawford,
President of the National Associa¬
As Mr. Frederick

than the

J

is what
Europe;

factories

tied, destroyed, or outworn.
We are hearing a great

The Future of U. S. Foreign Trade

inOc¬

with

promised

be seen all: over

tion of Manufacturer s>; said>

them

the

„

be

nothing today is

for

and lesser degree, that

J having them make goods for foreign countries. Why did we never
think of this before?
7
'

Exports do provide jobs. Now it
is beginning to be understood in
this country that there is no vir¬
tue as such in exports. They have
no meaning unless they are paid
for. In order to receive payment

de¬

are

stroyed or have been robbed of
their machinery.
There are no
raw materials and coal supply is
20% of normal. And to greater

Foreign Tiade and American Prosperity
(Continued from first page)
of quite
a
different
character. Last year, Mr. Currie,

Factories

field.

covered

statements

Thursday, February 14, 1946

and

businessmen

United

abroad.

States needs to

give employment to

If

the

export to

its workers,

how much more necessary will it

more

countries, and

difficult will it be

for

us

to admit.

v
7
point of < view this4
makes a rapid expansion of ourforeign trade , of doubtful com¬
mercial value.
We vmay for at;
while enjoy a comparative boom
and
find
employment for
our!
workers in plants with productive
capacity exceeding domestic re¬
quirements.
But the honeymoon,

From

-

our

.

will be shortlived—before long we

shall

discover

creasing

that

difficulty

we

in

have

in-!

collecting

Volume

least

at

need to be

Only

to

some

bly - what will occur in any case.
Gold production is definitely on
the increase and it is estimated

is: therefore by ho
means, bright and as I said I con¬
sider this in: a; sense a favorable

-

rapidly

:

V

"*7 V

v'

^

■

'

as

V*

-

"■

months ago about the export op¬

tight eompartmeht?; We have thus
far regarded it necessary only to
control one of these phases. We
do control imports through tariff

able

drive

a

with

car

four-wheel

which

somehow will make things come
out all right.
Thus through lack of a coordi¬
nated
policy; we have created
again and again a lopsided finan¬
cial relationship with the rest of
the world and if we follow the ad*
•

vice of qui* export

shall make the

the

are

many

;

for

reasons

the

world.

export trade may fail to reach
the
fantastic
figures we men¬

relations.

trade

the

high gear, the greater the likeli* ;
of
rising prices.
Higher ers may not find it as easy as
prices will act as an effective some thought at one time to sell
brake upon our exports.
Other abroad/ And this is leaving out
countries in a less chaotic indus¬ of the picture another important
trial condition will begin to fill factor.
orders which might have come to
Chaotic Monetary Conditions

have

We

aided

this country.

Sweden, Switzerland, are ac¬
tively pushing their way into the
markets able to buy. Their prices
for
many
items of equipment
needed by their customers are
lower than those of American pro¬
ducers and what is more impor¬

The monetary conditions in most
countries \vhich are potential im¬

porters

American

of

,

chaotic.

goods are
instance,

To give but one

France is suffering from a severe

:

inflation, even worse, if
than Belgium. Re¬
cently the French franc Was deof

case

this is possible,

they can make

immediate delivery.

49.627

valued from

:

119.107 to

to

! the dollar.
Foreign Import Restraints
most

The

effective

obstacle

-r-

I

to

believe that this will

do not

be the last time that France /

export, activity will be found
in/ the restraint placed •npoti/im'- j
ports, hy the countries that would
feu theory be our most effective
markets. Australia is determined i
to protect her newly established
industries and will do so increas¬
our

■

•

ingly by high import duties, These i

take such

step.

a

will

Since 1928 the

franc has been devalued six times.
The effect Of such devaluation is
export and to deimport possibilities.
not the
only coun-

to increase the

the

crease

is

France

try

that

will

need

to resort

to

Our exports will

such measures.

idous
the

and

properly

so

which

life.

nation

union

in

,

moderate rate of in¬
terest, and that both the loan and
are to be paid, then
such loans make increased exports
•

a

absence

When

of the borrower more
than ever. Consider the
credit position of Finland.
Fin¬

of

has

on

paid

us

$6,219,685, and they

$8,032,000. And Fin¬
producing products, such as
pulp wood for which we had a
market was in a relatively favorstill

owe

us

land
■!

able

t:

position to make payment.

"■"Under the most favorable

con¬

ditions, a loan means a temporary
flow of exports from the lending

recon¬

taken

,

land
borrowed
after
the
first
'world
$8,833,011. Thus far Finland

of

sake

the part

necessary

a

country, followed by a long period
during which the borrower must •;
in some way contrive to export
enougn to pay the bill.
No mat<
ter what we do, the answer al¬

of

have in

may

controls,

of

abroad

it

own

deaf

then

turns a
to those who come with

controls

cannot

be

It therefore is not a

rather what kind of controls. Now

from the point of view of inter¬
national trade, the most disturb¬

problems is to do nothing to solve

—

that

question of whether there are to
be controls or no controls, but

it

the message that the way to solve

ing aspect of such controls con¬
sists in the fact that they are the

them.

For that reason our gov¬
ernment's message that what the
world needs is the removal of

*

expression

of ; unilateral

action.

Each country acts independently
government : restrictions and of
in an attempt to improve its own
restrictions placed upon trade by
private combines is not received position. Generally such unilateral
action
harms
other nations by
.

with

ah

world free from controls were

not

a

bootstraps,
ear

a

abandoned.

country is attempting
desperately to pull itself up by its

enthusiasm.

Their

response

be summed up in the
question; "You tell; us how."

may

:

one

;y

limiting their economic opportuIn self-defense those in-,

.

nities.

jured countries take similar uni-.y
respond by telling
lateral action and things progress •
them that only in this way can a
from bad to worse.
They did so/
world be built with an equal op¬
after the first war and we are/.
portunity for ah, they answer that
nicely on the way to see the
even a total removal of all restric¬
story
rewritten in even more
tions even Including the United
States would not create equal op¬ striking terms.
The problem
is therefore to k
portunity, The poor would still
remain poor with destroyed plants recognize the fact that each na- <
and underfed workers.
The rich tion through circumstances over
world will be rich with over- which it : had no control or be¬
expanded and undamaged fac¬ cause of a long historic development needs to maintain certain
tories.
There would .not be equal op¬ controls over the flow of goods
portunity. It would create a world out of and into the country. And
in which the rich would win and while recognizing this fact to set
the poor would have practically set about to coordinate these con¬
no chance at all.
Seen from our : trols so that instead of unilateral
When

excel¬

an

would have

we

the

sound eco¬

was

'on

a

the

to

loan

a

the interest

this faith is not shared.

wasyh^ilhd as the first step
It

for

may

pump

pays even a

.

Belgium during the
for an economic
be^wberi the two countries.

nomic revival.

action

priming

the

,

ex¬

for all our economic problems had '
ways comes out the same—more i : :
suddenly become to let the boys
export opportunities.
This would
fight it out among themselves.
give new weight to our message
Whatever faith

nlans

the direction of

that

pump

cause

domestic

•

aspect if we had hot
suddenly decided that the war
was
oyer and that the remedy

Holland and

This

mean

good.
present period

Our

economic field.

laid

does

faces

that

serve

And we

freeze up altogether.
If we assume that such

different

sudden and urifcoordinated change

war

It

our own

.
sometimes

common

version
.

with

away

of

ence

the

a

:

.

•

that

our

over,

jperience

themselves

of

will

countries the
within and outside
bloc.
But interna¬

sterling

;know from

war.

part

Britain

,
only as pump primers.

gigantic
task, people must pull together,
give up some of their independ¬

•

will do

permanent

a

■

tional loans of this character

that they must be¬

when

agreement — the
Bretton
Woods
proposal under
which the nations agree to take
steps

nor

blocked in

are

boost for many

world

on ex-

mean

in

are

national

other

development of

the

in

does not

controls

come

preaching to the world.
Too
often,
however, we have
spoken like the preacher who
said, "Do.ras I say; for heaven
sake, don't do as I do."

international

during the last

now

without question a tremen-

;mean

kinds

certain

on

restrictions

which

the English banks.
A revived Great

have been less free than

that

desirable,

of

deal

'

now,

in

such

consider it good national policy to in the foreign exchange rates. This
Trade cannot revive
protect their new and in many is sound.
cases
high-cost industries from when currencies jitterbug. But no
foreign competition. It is there¬ stabilized conditions can be cre¬
fore quite probable that increased ated and maintained in the mone¬
obstacles will be raised the world tary field until a certain degree of
stability has been created in the
over against imports. Our export¬

hood

right

as

Now

situations, we must be careful to
distinguish between what is the¬
oretically ; desirable in the long
run and what is practically pos¬

strict imports correspondingly.
J
All this means that they will

•

tant

But

restrictions

credit

on

:funds

had not

we

owned by those who
during the war,

sums

sold

won

were

they are not to face again
financial difficulties they must re¬

In the first place, it is not un^
likely that our price level will rise
substantially in the near future.
The longer the scarcity of civilian
goods continues because of the ;
failure of management and labor
to come to an agreement which
will start off our production in

have

we

If

tioned.

huge

must ad-

we

never

never

export opportunities for. the LatinAmerican countries will shrink.

our

could

We

But

world markets,

the

entering

us,

enable that country to set free the

be
hon¬

are

we

loan to Great Britain will also

our

ports, rationing and price control.

forth, the more indus¬
trial activity there will be. The
more factories and merchants will
be abie to offer employment. Ultimately world prosperity will be
promoted by the freest possible

ply are opening up again and
Africa and the Far East are again

why

ourselves,
we

cer-

back and

they, Will need to keep those in¬
dustries for another good reason.
Now that the older sources of sup¬

mistake in

Fortunately

future,

there

of

But if

the industrial battle if

be

can

.

nations

trial

enthusiasts,

same

anything that

*

ships with the rest* of the world,
we close our eyes to two-thirds of
bur activities, keep our, fingers
crossed, and put our faith in a

with

mit that

.

only one brake band
is- in -working order; but in our
economic and financial relation¬

Providence

est

a

can

uncontrolled

free

a

economic life.

,

war are

what

of

in

Ultimately the more goods flow

sell al fantastically high
.

brakes when

benevolent

there

Is

during the
proof

achieved

prices ' raw materials in large
sible
in the immediate future.
quantities. As. a result, they find!
This distinction has not always
themselves in a better financial
been kept in mind by those who
position than at any time in their
shape our foreign economic policy.
history.
They are estimated to
We shall not be able to work out
have about four billion dollars in
a
sound policy until we realize
available dollar balances.
clearly what the practical necessi¬
But again, I would warn against
ties of the moment are,
too much enthusiasm. While they
It is easy to agree on general
were unable to buy merchandise
principles. Who indeed would not
custorifarily imported,;these coun¬
be in favor "of international co¬
tries have built, new industries.
operation or who would deny that
They will want to keep them. In¬
freedom is a most desirable, thing.
dustrialization to them means that
But practical necessity may make
they will have a more diversified
it impossible and even undesirable
and therefore more stable econo¬
to put into operation
measures
mic life. They will no longer be
which may seem theoretically de¬
the tail to the kite of the indus¬
sirable.
We have done a great

restrictions\ but exports and for¬
eign loans are left uncontrolled.
JJq one would be; foolish enough
to

tain

re¬

industrial y- accomplish-

of production,

portunities in Latin America. The
republics to the South have been
to

ments

unbe-

had

.

activity.
They
should be dealt with not as sep¬
arate unrelated matters, in water¬
economic,

same

lievable

almost

our

trade will enjoy greater freedom?

.

■"

world

that

us

as¬

done to create a world in which

•

"

retarded.

be
•

as

^

retard

sured

Instead. of merchandise
moving freely to the benefit of all,
the securing of world trade will

produce for export. Their domes¬
tic employment problems are ;far
jmore pressing than those; of the'
Exports, Imports, and Foreign
United States, and any imports
Investments
that are likely to diminish local
Our fundamental trouble is that work opportunities will be kept
we
apparently h a ve not yet out of the country.
*>
learned
that
exports,
imports
Latin American Prospects
and
foreign
investments
are
Much enthusiasm existed a few
all
different
phases
of
the

dig into the ground
it is received.

will

we

Mr, Baruch and others have

covery.

can4

that

factories

will

conditions

rebuild transportation

quired to

facilities; and

,

development. A very definite re¬
straint will be imposed upon our
export enthusiasm.
It cannot be' denied that such

purchase of a limited supply' of
machinery and raw materials re¬

labor, and capital, in
manufacturing articles we can use
and to receive in payment gold for
which we have no use, and which
resources,

market.

ly their small supply of foreign
exchange to employ it for the

good national policy to use up our

competition.
I
sympathize with these sentiments.
And yet it may be that
at certain critical periods of the
world and of a country's economic
life, a large measure of control
and planning holds out the only
hope of salvation.

suddenly: been
increased . more
than 100 % in terms of the French
The outlook

important European market, four
times as important as France; but

in the virtues of free

any

have

dollars

in

contracted

debts

importation only of the absolutely
indispensable items for civilian
use and will nurse along careful¬

000,000 than in 1941. Much of this
gold will probably flow into this
country. This,' so it seems .to me,
would be regrettable.
It is not

con¬

philo¬

by the sophic reasons for this: We are
will ham¬ afraid of any kind of planned eco¬
As a result of nomic life. We have absolute faith

per normal trade.
the devaluation of the franc,

importance. The other countries,
Denmark, Norway, Holland,, Bel¬
gium, France, and Great Britain j
must limit their imports for some
time to come. They will allow the

that during 1946 world gold pro¬
duction will be larger by $1,000,-

several

are

buyer, the added risks

trols upon

It may be

government

and

There

borne

is

risk

exchange

sell abroad

extent; are hot

argued that we may
receive substantial payments in
the form of gold. This is proba¬

'

trols.

written in terms of dollars and

compelled to place such strict con¬
imports. But Sweden,
Switzerland and Portugal do not
consitute markets of very great

tnade.

strictions

Even if credit js
the

impossible.

not

charac¬
the fortu¬

volume. and

imports.

neutrals able to

nate

readjustment we had

hoped to sidestep will

of

ter

once

the domestic

the

control

foreign accounts. Exports will
more decline and ultimately

our

855

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4464

163

...

we

,

>

plan but there is no indica¬
comfortable
position, with our action; multilateral action is es¬
today that the plan can be
tablished.
This is the only way
^wellfed if not overfed bodies* all in which a world composed of
put into operation in the near fu¬
'that may seem very foolish.
To
ture. When a meal which cost in
separate
units economically at
Other, nations it does not.
Brussels about > $8 in .American
war with each other can be re¬
money can be. bought in Holland
What Can Be Done?
modelled into a world cooperating
for $1.50, then we need know no
for mutual welfare.
-j;;
Can anything be done?
more of comparative price levels
We are indeed one world.
Our ri
Many things can be done, but
to see that they are so far apart
State Department last November
whatever is done will require time
that a union between the two
and
careful planning,
and will issued a set of proposals for the.
countries in which tariffs would
probably require some sacrifice. calling of an international con¬
become a thing of' the past is to¬
The rich may make loans to the ference on trade and employment,
day utterly impossible. The rela¬
poor. That is nothing new or rev¬ /with the purpose of establishing
tions between the Belgian franc
an International Trade Organiza¬
olutionary.
and the Dutch guilder, are kept
After the Galveston flood, many tion which would be a permanent
steady for the time being, but it
manufacturers and wholesalers in body like the International Labor
is common knowledge that if gov¬
Office and other similar organs v;
the Northern States canceled all
ernment controls over the foreign
obligations of the Galveston mer¬ of international cooperation. This f /
exchange market were relaxed, a
is an excellent proposal; but we •«
chants
and
granted them new
disastrous
readjustment
would
<
credit.
That was sound business. must enter upon this conference
suddenly take place.
They have never regretted this: without prejudice. We shall find
And what is true of the rela¬
action.
In principle, this is what that controls cannot be done away
tions between these two countries
the
British
loan
means
except with. We will find two methods
holds true in varying degrees of
Government control .
that there is more reason for it of control:
most of the countries in Europe,
and control by private enterprise ,
than for the Galveston extension
lent

tion

,

make

duties

it

at

present prac¬

tically impossible to sell garage
equipment,, hand tools, and other
similar manufactured articles in
that

market.

how

General

planning

to

Motors

establish

is
a

produce a
car
especially designed for the
Australian market, because they

^branch factory there to

realize
to
•

that it

will be impossible

import American made cars.
The

dollars

general inability to make
freely available to their

importers will compel many Eu¬
ropean

countries to

continue to




suffer

in

of

because

not only
relatively low

consequence,

the

prices that will for a time prevail
in the country that devalued its
but also because of the
element of uncertainty that is in¬
money,

troduced in foreign transactions.

Foreign Credit
In

normal

times

credit

plays a

important part in foreign
selling than in the domestic trade.
But an uncertain currency adds an
more

element
makes

of

financial, risk

normal

credit

which

difficult

if

-

and

even

in Latin America.

of : credit.

Danger of Relaxing Government
Controls
relax

To

would

government

create

even

controls

worse

chaos

today.
Our govern¬
ment has thus far accepted as ax¬
than

exists

iomatic

that

the

world needs

rapid liquidation of all

a

trade re-r

Great Britain

for two

prevented the flood from
reaching us before we got into the
fight ourselves, and Great Britain
is not a minor sector of the world
—a
business and financial reha¬
bilitation of Great Britain will
mean not only the opening up of
what was at one time our most
years

organized for this purpose.
Of
our government has under¬
a campaign of condemna¬

late

taken

tion, one may

almost say vilifica¬

tion, against these private organizations. The result is that today
the

very

shudder

name

cartel

sends

a

down the spine of most

(Continued on page 856)

>.

.
.

856

THE COMMERCIAL & FINANCIAL CHRONICLE

Favors British Loan

Foreign Trade and
v:

(Continued from page 831)

,

many,;,temporarily

yr..// /inflation" when the Treas-

have

'

itself works at

ury

V:

.

These mysteri
ous instruments of iniquity have
been represented to him as a Ger¬
invention with

man

agencies

other pur¬

no

German leaders.

In

countries

most

And

that

for, sound

trade,
take

controls

the

"

be

must

.

7.

a

our

own

through the creation of

ers

more

debt

*

/ Now

exercised

/;//.

braced

Socialism

that

get

resulting damage to

value

our

pri¬

As to point I, the British

chose Socialism in
The

of

purpose

free election.

a

the

loan

trade prior to World War II.

otic conditions of before the war

fare is

this

egate

inclined, toy del¬

important

business itself.

function to

If steel is

—conditions out of which

in¬

an

world

can

because

in peace

use

and

more

will almost

war

problem because more
steel is being produced than the

And let

remember:

us

hew

a

material

.This is

complish

fought,

time, and

the

effects

competition > if

of

this

disastrous

a

life-

its po¬

litical

to

implications

avoided.

•

What .is

is

be

/

-

1

sensible

more

than

As to point

together the steel producers
of the country, if they have not
already organized themselves, and
to say to them: "Organize so that
as

can

problem
with

Charter of the United Nations,

of
world
competition
producers of
other
similarly organized. See

The—An

quotas."
'

and

,; /•.
.•
the essence

-

production
•••;*■ ;•

-

That is
of a cartel.
The fact that because of inade¬

national

quate

supervision
such

cartels

guilty

of

have

at

welfare

activities,

-

them.

times

Y6rk

does

Unorganized
not

with

only the
mind; and yet

in

condemn

business

always
public
we do
such,

as

made it

criminal offense for

a

businessmen
selves in
A

our

to

organize
them¬
similar fashion.

a

But whatever our national
law,

we

can
hardly expect other na¬
tions to abide by it.
We must do
business in a world in which both

governments
sanctioned

a n

operating.

no

good.

ture

is

of

government-

Preaching will do

The

-

to

the

combines

wisest

recognize the
world* to

to

course

be

struc¬

as

it is,

Income

Tax

5

•■'•*'.• *>«.•

Withholding Chart

Book for 1946—for semi-monthly,
bi-weekly, weekly, and daily pay¬
roll periods—Manufacturers Trust
Company of New York—paper. -

Pension

and

Profit-Sharing
and text of law

Plans—analysis
arid

regulations, and model forms

of, trust
turers

agreements

Manufac¬

—

Trust

Company, Personal
Department,
55
Broad
Street;.New York 15,; N. Y.-Hpaper,

The

titude abroad.

From the point of

view of the
stabilizing of interna¬
tional economic relations, it must
be recognized that these combines
may,

used

the
not

under
as

proper

effective

control,

be

instruments

in

building of

a world in which
cut-throat competition but a
of international economic

nancial

Aspects of American In¬

Co,,

Inc., 52 Wall Street,
York 5, N. Y,—paper.

New

,

*

We have set about in the United

Nations
one

Organization

world

in

the

to

create

diplomatic and

the

military field.
All attempts
along this line will fail unless we
build upon an
one

economically sound

world.

The* objection

will

.be

raised

/that by, thus cooperating with.ex;-

isting foreign

the

government control




better

or

to

to

created

were

gold to find
market.

a

indebtedness he

a

home/ mortgages

live

They

"or

manding deflation of wealth and
inflation of wages and commodi¬
ties.

'hi

•

\

.

As td* point

IV; it is emphatic¬
ally trtie; that gradual inflation is
occurring. This is part of the new
economic U system
stand trial just as

century

laissez-faire.

progenitor

'Tree

which
did

of

sing

so-called

rigid

gold,

until recently dom¬

was

by

19th

made, rents and interest rates

-

•

As to point V, the
price control
(OPA) is a temporary
instrument. Its continuance is ad¬
measure

Report Proposing Amendments
to Federal Income, Estate and Gift

we

Tax Laws—Trust

version

can

Bankers

36th

Division, Ameri¬
Association, 12 East

Street, New York 16, N. Y.—

paper.

\

.-

,

Retirement System for Farmers
—Murray R. Benedict—National

Planning Association, 800 TwentyStreet," N. W.; Washington 6,

first

D. C.

—

paper

quantity)-.

—

vocated

So

in

cash

unemployment. Gradually, mem-,
of the investing class: are
to seek real employment.

hers

forced

as

Thus the ranks of the unemployed
increase.
Only those few of great
and

who

man

•.

•..

-

.

-

and

Harris, Halt Co. Adds
T. McPhee to Staff
Harris, Hall & Co., Inc., 14 Wall
Street, New York City, announces
that

Thomas McPhee has become
associated
with the firm in its

corporate trading department. Mr.
McPhee was formerly with Lazard
Freres & Co.

more

Point VI

a

a

Now

this

covers export trade—
irr America's high

Chamberlain

importance

national

of

income

by export trade.

the

is

the

now

these

from

bonded

3.

and

the

Moreover,
stead of

10%

of

represented

Take it away, as

did in 1930,
of the vicious

through enactment
Hawley-Smoot tariff

and
you
remove
theJ cushion
which determines
profit or loss for

American industry;
^Furthermore,
with our two
formidable indus¬
trial competitors,
Japan and Ger*

..

Now

//:
.

/
6.
'

;
'

'

tion problem

per

day

the

day,

the

over

earners.

duced

and

wages

investor

are

has

$10

.

commands the services of six wage
earners.
His relative wealth has
been

increased

the .other

scale

goes

three' fold:

hand,
to

the

$15,

• If,
on
daily wage
the investor

fall

in

the values

,

of wage

As human activities

increase through

world

re-

// construction and restoration
'//

of commerce, let the price of

gold
/
/

/

If

daily wages are re¬
$5, then the investor

and

earners...

services of three wage

to

rise

//of surplus wealth rather' than

•/Or:by holes in the belts

per

command

■

and

by
abolishing
tariff
barriers. ' /• ////■/■//'/://;■;//:'•//';
Stay away from a fixed an-/
chorage for gold. The elas-:
ticity for a cooperative world
a

/

investor/. If the in¬

vestments yield income of say $30

reduce

society must be provided by

from the standpoint

of the retired

but

lanes

-

consider the defla¬

us

decade,

/ized

be

temporarily

in

reference

commodities

stabil-

to

other

through
the*
function of the World Bank,
•

v

The painful alternative to these
six proposals, is to follow the un¬
orthodox
financial: methods
of

1920-'30' which-fostered
down

the

'

strengthen
the Bretton-Woods monetary
plan
and / simultaneously
throw open the world trade

\

maintaining streets, parks

let

a

5. Implement

.

♦

,

Federal expenditures to the

must

repair, disintegration follows.

reduced,

prudent minimum.

occur.

community

gradually

Keep individual income taxes
at present high levels for at

/

standards of living. In¬

its

lower

a

least

of taxes

bonds must

on

s

work-week.
4.

from

earnings, it is inevitable

that defaults

Federal

lessened

Encourage high daily wages
through incentive pay plans;

:

indebtedness

source

private enter¬

prise in the form of reduced

live,

satisfied

•

-

taxes and
restraints.

lost

earners

our

allies,
Great Britain,
Soviet
Russia, France and
China
and
lesser
friendly
states,

community* in

wage

,

war;

2. Give all aid to

everything—even self-confidence.
He and his family have descended
to a lower scale of living.
Take

prove un^

1. Make generous loans to
/

pay¬

has

never

burdensome.

nor

ahead;%/|/^^

fortunate friends

wage -earner

and

In: my judgment, there are six
important- steps ta follow, in the
great ^recovery r era which -lies

r

deficit.' and other community property in

•Speed economy. Surely, our
stupid
tariff policy of the
twenties must
have awakened Mr.
the

wieldy

debt leads to foreclosure.

on

followed

high levels recorded in
'45, I daresay our

1943^'44

automobile

taxes and meet interest

pay

ments

the

near

Finally, failure to

the

most vital cog

we

from

relatives.

abyss; which

Federal debt will

occupies

man

'fifties,

Assuming, our national in come
will be stepped up to somewhere

the humiliation of-borrow¬

Since

treasury surplus replaces

to

ing

it does in

as

1929. :

jewels and other valuables.- Then

taxes.

level where

h orrible //

recrea¬

longer

no

and

s truc-

I question very much whether our /
nation would have sunk into the

an¬

is consummated, even the sale of

or

controlled

ture in the 'twenties

normal

is eventually dissipated to
complete installments on the fam¬
ily automobile or furniture. Even¬

comes

result of the tragic
Had the Fed¬

managed the over-all debt

payments, the
surrendered for

be

a

as a

its cash value. A small savings ac¬

must

income climbs to

in

low¬

graphic outline of what

a

Government

count

which

high national

our

is

savings at record levels and

working at cross purposes. 'This
will continue until
full-production
is restored and our

5

principal

has

1920-'30.

eral

of living. ; In an effort tc
make the sacrifices to meet inter¬

is

financing continuing, the
Treasury are

here is

scale

est

labor

follies of

home which goes with a certain

a;

reduced
and

happened

ciety;/ /Now/ reduce this annual
wage to say $2,000 and see what
happens.
There is
surplus. This young

analysis,
prices/for

cultural develppment and curtail¬
ed education.:;
In an; eye-cup/

to his place in so¬

There

OP A and the
Federal

a

our

nrivileee of indulging

common

that

survive

means

the final

ered the scale/of living/ arrested;

tions and amusements, and indulg¬
ing his children in such liberties
are

find

commodities

nually to meet interest and capi¬
tal charges on a pledge of
say $4,000, we should accord him the

as

stress./ In

we

be pre¬

$600 dollars

can save

independent

the

the 'forties and will in the

of

case

which

deficit

250 (discounts in

•-•••

the

until only such time as
safely through the recon¬
period.
Obviously, with

are

can

Real

of buyers.
of tenants.

output of the industrial worker
farmer.
The result is more

cold,

no

default.
lack

or

and

can

spend

that

/aristocracy posses¬
Actually; a tually, the sale of the

an

feudal rights.

genuine free market, where prices
are

know

England, life insurance

the

market". and

must

the

should

mathematical formula

out of

but steep rise.
Enlightened world
political leadership is at last de¬

con¬

ihg power; of the investing class;
They lessen the demand for; the

.

save

taxes

Rents decline for lack

scribed for the guidance of youth
nor government.

the

gradual

more

depreciate,

trial and railroad bonds cannot be

Most normal men
within
then

assume^

women

lain

free and unfettered

It should have

Securities

/

redeemed. Issuing corporations are
forced
to the wall.
Farm and

■

create

offset

inheritance

and

becoming worthless. Indus¬

some

properly assessed. But each gen¬
eration must gain or lose by its
own
experience.. Mr.v Chamber¬

world

determined, wages are fixed, abso¬
lutely
without restrictions
or
Rayon Common Stocks—outlook privileged pressure of
any kind
for the industry—E. W. Axe & has never existed.
It probably
Co., Inc., 730 Fifth Avenue, New* never will. Someone always will
York City—paper—$1.00
have a finger in the
(500 to
pie.

spirit

cooperation will prevail.

For

and

more

These losses reduce the purchase

means.

functioning of the World
Bank should concomitantly allow

inated

about these cartels. There are
bad

function of the government
is to make bad cartels
good and to
keep good cartels good. At least
that is the generally
accepted at¬

views.

fiscatory.

na¬

conditions warrant..

result of two

a

ink

of

which

pretation of the Economic and Fi¬

public libraries and nonprofit in¬

good cartels.

taxes become

densome

safely

ink. The

standard

stitutions).

are

debts

the

dustry"—George S. Armstrong &

as

engineers

out

Plastics and the Plastic Industry
—No. 7 of an "Engineering Inter¬

and to act

cartels; there

values

'/■

there is

accordingly. Moreover,
nothing innately wicked

Chamberlain's

Income

creased.

past events

estate values fall because of bur¬

..: *

industrial

are

follow

d

"«'

"V

Trust

Under
laws
passed
in
1890,
when the world was simple, we

Unfortunately,

financial

17, N.Y.—paper—-500.

£;y.-Vi-';•

been

action

business.has

operated
not

international

their

anti-social

not condemn

private

and

of

Analysis—Felix Morley
Enterprise Associa¬

tion, Inc., 4 East 41st Street, New
•

prices,

market.

review

adopt Mr.

and

costly wars has gone beyond the
ability of people to pay. To ease
the debt load, it is the job of our

American

—

that you come to some agreement
with respect to the division of

markets,

we

can

III, it should be well

debt structure

-steel

countries

working class cannot contribute
its tax share, the burden is shifted.
Taxes on invested wealth are in¬

what could happen should

know, what

known that money is community
debt.

discuss the

group

a

it;

money,

_

to

call

you

which

measure

for

ing power of-the wage earner iilters
through to the upper level. Since the

definite

keen

nnd-death battle with all

no

to spend his
be trusted to

value

and better living standards.
eventually, the reduced spend¬

oower

But

They provide
steps to implement the for their dependents through life
peace. The Bretton-Woods Agree¬ insurance and
generally speaking,
ment, the UNO, the destruction of get what they can from life as
Europe and Asia's caste system, they go along. No doubt many op¬
the release of gold from its fixed
portunitiesrare;/wasted/ Foolish
mooring are just some of the salu¬ mistakes are made. As always, in
tary steps:
the later years, these errors* can be
' *

engaged in the production of
steel, something must be done to

.are

soften

for

end

in

hand, the working class
become relatively more
poor. For
a time, the
independent investing
group
enjoy greater purchasing

manly impossible' for any young
man
commencing adult life
tc

of any com¬
So what? If we ac¬

the

then

the

now

.

the other

.

spends

com¬

Now the youth of today is not
without self-confidence, ambition
and courage.
Moreover, it is hu¬

■

the human and

on

leaves
us

like

.

and

wages

War II.

the cost be assayed.
By contrast
with World War I, we are
taking

countries

more

.

When

modity, prices/are permitted
'to
fall, the comparative wealth of the
investing class is increased.
On

I happen to belong to the
younger generation who are enr
deavoring to make of this world'
something better than the one
which
existed
prior to
World

resources

batant nation.

last chance..

our

drain

a

can

State

tionalistic

As to point TI, obviously war¬

certainly emerge.

creased.

worse,

will in turn hasten her return to
the
position occupied in world

realize that this is indeed

the

see

we

then is

world and that prosperity is
indivisible; the world will before
long slip back into the same cha¬

are

to

he

something

Let

people

goes out

man

When

vate enterprise system.

capacity to

commands only two wage earners.
His relative wealth has been de¬

of themselves in

care

money,

become strong through Amer¬
dollar grants with
the

one

ternational

.

a

own

ican

governments

r

ever

will

and

government-in-business

lim¬

payment.

we

take

can

,

/:/

I

Our industrial lead¬

competitive markets.
That export trade is not our
As to point VII, our private en¬
salvation, but our undoing. terprise system competing with
Cheap foreign goods in the Europe's Socialism, I can answer
end will displace domestic only in the words of Sir Ernest
goods with resulting unem- Benn who said, "Politics is a short
ployment and hard times.:;// sighted business, while business is
That all of Europe has em- a long-minded affair
When¬
.

begun to
realize that a government body is
usually ill equipped to exercise
such control, so more and more the

less

liquidated,

fears for American busi¬

no

acumen.

the

money./; :

together with other not to implement the socialistic
nations, succeed in building a leadership of England—it is rather
for the purpose of meeting Eng¬
live-and-let-live
world
through
genuine cooperation
among
all land's vital needs. Reconstruction
nations in the economic field; un¬ of her economic and industrial life

have

governments

and

ness

Unless we,

by these

reasons.

/;/;

fi?
-

in
mind conditions abroad, the
requirement of a gradual and
peaceful rehabilitation of world

they

governments. '/*'• ,r /

:///:
/

itation by agreement and negotia¬
tion—a limitation which will bear

and supervision and are not only

tolerated but encouraged

,

For this I would substitute

subject to government control

are

\,'/

6.

no

lated and unpredictable unilateral
actions of foreign governments.

fact, these car¬
tels did not find their origin in
Germany but in England and Bel¬
gium, and at present they are
found in every important com¬
mercial country except the United
'States.

is

me

-

matter of

a

This to

have been restricted by the unre¬

///,, /•;■//:i/
,Cartels ;:;// J";/////
As

private com-;
shall limit our export

Our exports have always been
restricted.
But in the past they

'4

*vV

with

argument at all.

to strengthen the ne¬
and sinister aims of the

farious

and

bines, we
opportunities;

than

pose

cross pur¬

poses

(Continued from page 855)
loyal Americans.

Thursday, February 14, 1946

of

world

extremes

of

trade/

a

break¬

promoting

nationalism

and

THE COMMERCIAL

Number 4464

[Volume 163

85:

& FINANCIAL CHRONICLE
for the Executive is

directly lead us into World War
II.; We made foreign loans for po¬
litical advantage in the twenties,

conditions? When

but under what

Europe and the British were ready
to sell their manufactured goods
competitive market, we in¬
: Finally, with the
adoption of the Hawley-Smoot
legislation, America really had
made the world break-down com¬

; in our

itiated tariffs.

"High-Level" Employment—Now and Forever
;*Y (Continued from

In particular, we
depressions
have brought hard times

■

periodic intervals.

for millions at

fi V'/'v;. '*i '^Xl

Government Spending a False
Idol

the

remark¬
First, a

tion has gone through a
able evolutionary cycle.
rush of settlers to the

land

vent

want to eliminate the

which

West, to the

by
newly
railways.
: Then
a

made,, available

constructed

considering

We have been

a so-

bill

employment

full

called

in

That

be

if only the Gov¬
spend; enough

guaranteed
will

ernment

rapid .development of. industries
and the growth of enormous, for-

money.

tunes; next a period of frenzied
Wartime prosperity, and finally, a

Truman,

that Government

PAG insisted
spending was a

great financial autocrazy; jockey-

panacea for every

ill and in every

ing for world power. This same
cycle; much more slowly, has oc¬
curred in the history of European

crisis.

in its original
by.
President

The bill
form /advocated

It

and

was

the

problem

%

;

Yi).

■

Y X YY

only Ybe

can

,

based fundamentally on

which

factors

There

must

be

between wages

farm

encourage

Truman's

OPA

doubt

it

do

must

a

to

budget message and
message is not en¬
At
one
point
he
the Federal
budget

couraging.

eral

increase
all

in

is

wages

and

costs.

that

gen¬

a steady balance be¬
prices and industrial

a

budget
that

states

in¬

"can

hardly be expected to be re¬
duced to less than $25 billion in

all

prices.
After a valiant fight against infla¬
tion, the Government policy to¬
crease

We musjt

spend ourselves into prosperity.
President Truman,
last week,

presented

a

budget.

get rid of the theory that we can

and the inevitable result of

it moving.
steady balance
and prices and the

Government

stop

checking,
production.
In
any
event, OPA will not last forever,

keep

control
We
deficits

has the power.

and balance the

without

so

in¬
policy

a

something to

do

can

we

and Congress

cap

can

Here is

stead of better.

hold prices
temporarily, I do not know, but 1
if

inflation

runaway

a

and make the situation worse

of

Whether

cost of living,
tween

ernment

policy, will prob¬
ably place the increase in average
straight-time hourly wage rates,
after allowing for downgrading,
at approximately 50% over that
prevailing
before Y the
war.

pol¬
icy in finances and in economic
measures.
The problem is to keep
the great economic machine run¬
ning steadily, smooth],y and speed¬
ily with full production.
To ac¬
complish that there must: be a
sound balance; between all the

by theorists
prosperity can

that

believe

depressions,.;;'

declaration

solved by sound Government

Washington, written
who

stimulated by President

high-level
employment
perma¬
nent; how, in other words, to pre¬

petitive system.

rapid whirl of events
during the past 50 years, our na¬

"'

.want to

we

eliminate the failures of the com¬

plete.
'In

835)

page

Above all,

chinery.

pursuing an¬

policy of unrestrained Gov¬
spending
which
can

other

urged

subsequent years."" I have
and

over

day, as far as we can; judge, will
prices, a steady, balance between
force a level of prices at least 40%
savings and investment,, between
higher than; before the war.
the,-purchase of capital goods and
It is not surprising with this
the purchase of consumers' goods.
Government policy that the price
If the price level gets too high
of capital goods has correspond¬
for
the wage level, purchasing
stops and production must be re¬ ingly increased, both on the stock
market and in the real
estate
duced.
If wages get too high
market.
It
has
never
proved
compared to prices, the profit in¬
practical to fix the price of capr
centive to produce or; expand pro¬
ital goods.
If prices were fixed
duction ceases, no one expands
on
stocks,
legitimate
trading
their factories or builds new fac¬

that the Federal
make now an esti¬

again

Government

mate of its post-war

of

aftermath

the

"

budget when

War

expenses

disappeared.
This
is- the
first glimpse in that direction.
It
has

encouraging.

is not

,

the absolute guarantee of. jobs
Many private organizations have'
of auto¬ by the Government, to be made
made such estimates.
The Com¬
cratic power have been marked by possible always as a last resource
mittee on Economic Development
overbearing and oppressive lead¬ by an indefinite spending of Gov¬
estimated the Federal
expenses,
ership, coupled with low stand¬ ernment money.
The advocates
hot including debt retirement, at
ards of living and poverty.
Now, were entranced by the .idea that
between $16 billion and $18 bil¬
again, throughout Europe, and the huge spending had brought about tories; and again production falls would cease until true values
lion.
The: Twin Cities'" plan esti¬
were recognized.
If the price of
Orient, we see lorig^ faces and full employment during the war. because there is no
profit in
mated these expenses at a mini*
threaded garments.
We see stag¬ They overlooked the fact that it undertaking it. That happened in old houses is fixed below what is
the probable ;value after controls mum of $15 and a maximum of
nant trade and endless queues of was done at the expense of in¬
1937. when
manufacturers were
$21 billion.
The;, Committee on
weary people waiting to spend creasing the public debt by $50 afraid to raise their prices to meet are removed, sales will stop, ex¬
Postwar Tax Policy estimated ex¬
their ration coupons on the bare
billion a year. Obviously, huge increased. costs and utility rates cept, on the black market.
I do not believe it is practical penses at some $14 billion to $19
necessities of life.
Manners are deficits cannot continue without were
regulated
by law.
The
to fix the price of old or new billion; the Brookings Institution
rough and courtesy a forgotten producing a
great increase in same thing threatens to happen
at a probable figure of $22 bil¬
houses, but > I do think that for
quality;
Everyone seemingly is prices and the cost of living, a dis¬ today if price controls are too
rig¬
Now the President causally
the present we should continue lion.
suspicious of his neighbor;' It is torted boom, and then the very
idly maintained.
If farm prices
some
control over the price of raises the limit to a figure of $25
indeed a sad state of affairs.
collapse and depression we have fall; below industrial prices,; the
billion, apparently" not including
We know Europe is hopelessly been trying to avoid.
When it purchasing power of the;farmer building materials and building debt retirement.

Their periods

nations.

ridden.

debt

Had World War I

and World War II been fought on

basis, there would be

cash

a

need for this Recurrent

no

discussion

debts; With
accrued interest, the debts owed
us from ,World War l alone now

solution of

of the

war

perhaps $25,000,000,000.
To
this sum must be added the stag¬

Was

pointed out that Government

deficits in the thirties did not pre¬

the answer

unemployment,

vent

deficits were

the

that

was

not

enough.
They should have
been $15 billion or $20 billion

big

instead of three.

total

gering total of:goods and material
shipned abroad 'during and immediately preceding World ;War
II. Some of this debt could possi¬

■

Country

bly be paid if the Old

would make the necessary sacri¬

The Problem Is Not to

Create

Employment but to
Maintain High-Level

Full

Employment
This so-called full

.

bill to

because the goal of all of
fice.
But there is no power on us is full employment, or, more
earth -that can wring: these
exactly,. high-level employment.
fices from the distraught people of, There cannot' be absolute full em¬
'.Europe. The total war debts, our ployment at any time. There are
Y own included, are greater than all always several million, changing
the

excess new

the

and

goods

llfe«

employment

not been an easy

bill has

production drops of
the farmer buys.
If
more money is saved than is re¬
quired
for
capital investment,
there may not be enough spending
to maintain the production of con¬
sumers'
goods.
This seems to
have
happened in
1929 when
everyone was trying to make his
fortune, invest his capital and live
without working the rest of his
drops

oppose,

wealth which-can

In

,

general,

.

have

to avoid
both Y inflation
and
deflation.
Both rising
prices arid, falling
prices distort all relationships and
the struggle of those who suffer
to regain their, relative position
produces endless strife andcomolication. What we want is % stable,
balanced price level and $ stable
we

v

from job to job. 'There are mil¬
several lion^ who work at times and do "wage level. Only if?we can con¬
future generations.
We created not; care to* work kt other times. tinue to. increase the productivity
these debts out of nothing.
We
But, roughly speaking, we all of our workers, which in this
must pay. them •' With , something agree on the goal; of maintaining
country has averaged from; 2 to
created out of nothing.
The debts a condition in which every man
4% a year, can we very gradually
cannot be paid with money be¬ who wants to work can get a job
reduce the price level and in¬
cause they .are
mere hallucina¬ which will pay him the value ot crease
the.wage level without in¬

be produced by. this and

.

Therefore,

tions.

they

must

be

paid with something equally un¬
Nor is there any hope of

want con¬

That is, we

his work.

flation.

v

profits.

Also, I believe that rent

control
tinue

in

for

form must

some

at

least

another

The shortage of homes is so
ancl
so
impossible to

The
con¬
present tax rates only„
yearY yield $27 billion, so that if we
allow anything for debt retire-:
great

meet ment; under President Trum^ny
promptly, that without control budget, there will never be any
there would, be an inflation, far further reduction in our tax rates
beyond that justified by increases and a steady increase in the pay-:
in costs. Y The controls, however, roll tax. It has been assumed that
.

should be reasonable and I

hope

the tax burden

new, homes. YI
that rent controls

believe myself

comes

should

that the rates

on

be

en¬

our surplus farm and manu¬
factured goods" by making avail¬
able dollar exchange.
When we

for

level

prosperity

and

not

of

more

housing .which is the only

ultimate solution..
have

I

said

*

„

that

In

the

former

the

Government

policy is a mistake
bringing about a perma¬
nently higher and inflated level

and

case,

load of indebtedness <is

increased

time.

she needs it

now.

It will enable

expected deficit
payments during
Should -We < refuse toYwhole¬
the next six years,
It will enable
heartedly YY support I the Y World
her to buy from the world the
Bank; should we refuse to sanc¬
"implies of food and raw materials
tion
loans
to '"Great" Britain,
while in the latter it is decreased.

her

to meet, the
'n her balance of

now

has

officially admitted that thetff
a
33% increase in the

been

-

.

<

which

are

of living

since 1941Y

Some

claim it is much greater and it

is

world

recovery

and World War




'

■

Federal

the

If

Government;

spends $25 billion and; the State;
and local governments approxi¬
mately; $10 billion, we will be
spending more than 25 % of Your
national
income
for -taxes. -. In
effect, every man will be work¬
ing one day out of four for the
Of course; one* re¬

Government.

wages

general inflation of
and prices will be .to in¬

crease

the dollar total of the na-Y

of

sult

the

tional income and thereby

reduce

slightly the burden of the national
debt and the interest thereon, but
of the Gov-r
likely- to increase
general
increase in"

all the other expenses

ernment
with

are

any

prices.
Budget Is Indefinite,

The
V

Confused and Misleading
The entire budget shows a

,»*

lack

and so;
it is almost
impossible to analyze.
The esti- .
spiral Y which Yean
destroy our
mates of $8 billion for the Army
whole system of individual and
and $5 billion for the Navy are
business
freedom, y It must ' be
lump sums accompanied by no,
checked and can be by> a ^cour¬
detail whatever.
$13 billion a;
ageous
and "intelligent Govern¬
year Yis a; very heavy
bill > for;
ment encouraging the production
armed forces in time of peace.;
forwhich there Y is a r demand.
The Navy has-estimated that it
The damage already done could
will want $3V?: billion, per annum >
be gradually overcome by a united
when; peace
is completely re¬
effort
to r increase Y productivity
stored."; The Army has given no
in

set

-

motion

an

inflationary

of

interest

in

economy

confuses figures that

.

end.
In any event it is generally agreed
that prices have hot gone up as
bound

to

be

greater in the
,

Russia,* et al, then" real
work, of* the. British peoole.? ; V v ,
will be illusory
;. As a. Republican and. Califnrnian
much as wages and other costs.
II wilL have been
I heartily endorse ..the. President's Average Y straight - time
hourly
fought in. ,vain... In. other circum¬
stand; Y. F urge .you, Congressman wage rates, according, to the Bu¬
stances,
Great*; BritainY can * and
Anderson, to join other farsighted reau of Labor Statistics, have in¬
probably would devalue the pound
men and support this urgent meacreased -42%;over Jan; 1; 1941, 9%
sterling to a. very low figure:' the
sure;
y;1 y,Y:Y ■"? ;yyy'aYyYYy more than the increase in cost of
sterling bloc would be revitalized
Respectfylly yours, Y living."
The additional general
and strengthened, and I, for one,
:y;Y'-YY.; JOHN L. HOWE. increases in wages and salaries,
question very much: whether" our
France,

-

essential to the life and

cost

spending is;

adopted.

policies which lead directly to an
inflation of prices and then tries

ing prices against the other poli¬
cies of the Government, but it;,

low in¬
high anc]

middle incomes -

Truman's program for

is

at

the relative ed, '^Britain heeds; thik credit and

on

earnings and dividends on com¬
mon stocks.
All of these hopes
must be abandoned if President

,

think

I

.

;

certain that
very

we

proximately 50 % over pre-war.
We have had many to prevent the rise of prices by with very little ultimate increase
periods of high-level employment abitrary price control measures in real wages because prices will
think of reducing
the total of
in.
our : history. '
The difficult which cannot long, prevent the re¬ be correspondingly higher,
But
debts, we do not necessarily mean
problem is how to make that sult of wage rises and cost and the step has been taken and I see
diminishing the figures, but rath¬
no practical way to undo now the
tax., increases,
There is, no yse
er
decreasing the ratio; between
private Y enterprise system for the President / to' inveigh damage which has been done. Y
the numerical value of the debts own
We can do our best to prevent
against inflation when we already
and the numerical value of our could long survive the stress.; Has
have • inflation through Govern¬ this inflation from getting com¬
available means of payment, When Mr, Chamberlain ever reaped the
If higher
are
bound to pletely out of hand.
rewards Which follow extending ment action and
We destroy our available; wealth
new
and; additional credit id > a have more if we continue in our wages lead to higher prices,Va?
by defi ation. we inflate the relathey must, and we are then faced
the; value of debt. If we add to faithful, tried and proven comrade present course.
The Price Control Administra¬ again next year by further in¬
temporarily down on his luck? As
our dollar, wealth by inflation, we
creases
in wages, we shall have
deflate the relative value of debts. President Truman has^ aptly:^stat¬ tion has done a good job in hold¬
any

on

exceedingly

is

corporations. We have hoped that ;
might eliminate the duplica¬
tion in taxing both corporation

tain, that the removal, of. rent com?
trol would stimulate^construction

booms

ing about high-level employment.
Any government, can do that at

It is

repealed.

tirely removed; on rental housing and high incomes are so burden¬
built from this; time en, for few some as to discourage any invest¬
will undertake it if they face rent ment in risk enterprise.: Corpora¬
control for several years to come. tions are not so badly off at 38% Y
Only a small percentage of the net income, but most authorities;
total housing available will,. be feel that business activity would'
be. stimulated by^ lower rates for'
new housing and I abr quite gel?

•

tinuous

excise taxes would

our

be

direction of relaxing rent control

of prices.
That means a period of
a
stable
The Executive Has Adopted an
punctuated
hardship and adjustment during
segregating direct war debts from by serious depressions.
Inflationary Wage Policy
which millions of men and women
In fact,
normal debts since all our Fed¬ if we had another
The danger today is inflation. must bring up their own stand¬
depression like
eral debt has become interwoven.
1932, we might find that the The Government is so determined ards to meet the inflated price
It is the reduction'of our own
I believe that the effort
people, insist on turning to some to bring about full employment at level.
Federal debt which concerns us other
stabilize
system where the Govern¬ high wages that, it has lost all Should have been to
first. Secondly, and concurrently,
ment does all the operation itself. sense
of
moderation
or
sound wages and prices at about 33. to
it is helping Europe and Asia to
The difficulty is not in bring¬ permanent policy.
It has adopted 40% over pre-war instead of en¬
again become.profitable customers
couraging a rise in wages of ap¬

real.

of

many

that OPA is really moving in the

■

and
our

improve the

organization of

business methods.-

Y»

"

is Following an
Inflationary Spending Policy Y:

The Executive

But

hope cannot be too strong,

figure,

but

compulsory

military,

training alone would cost over $2
billion

of

the

and if the estimates
Army and Navy officers

a

year,

(Continued oh page 858)

•

858

THE COMMERCIAL & FINANCIAL CHRONICLE

A Hundred and

"High-Level- Employmeiit^
Now and Forever
(Continued from page 857)
recommended Federal grants and
to all local governments for

accepted, we probably will be
spending more than $9 billion a
year, even when peace is com¬
pletely restored.
Surely, we can
do an efficient job on less money
are

aid
all

public works programs, some¬
thing which was only done at the
bottom

The

rather boastful
all the public
works expenditures in one place
and proposing to spend more than
a billion dollars on public works
budget

about

is

adding

figure

authorized

roads, practically
be

of

ized

the

of that to
airports and

none

rural

Surely, during
much

so

public

$300,000,000

for

have

for

for

authorized

i'none

Even this
half
the

includes

only

money

author¬

when

time

there

is

a

ing.

editors

Our

been

sold

should

the

on

we

money, on public
the sake of spending

for

social

required. V;

The

condition

of

into the Federal treasury to
by the "Federal Govern¬

year

be spent

I

in

paying substantially all

doctors in

think

it

is

the

fair

United

to

States.

that the

say

President

has fully adopted the
Wallace theory that Government

spending is a good thing in itself
and that there need be no concern
the

to

as

tax

burden

thereby.

mes¬

increase in the

we

balance

did not actu¬

can

the cash

use

created to pay the $4
But I do not think

so

the statement" is
way.

themselves

and

correct

in

any

We have authorized the Gov¬

marized under the

freedom

basic*

of

exchange.

freedoms

amidst

a

These

exercised

were

to medical

as

ment

being

that

to

necessary

the

such

aside

from

Belief in

the

in

country

any

we

.which

President

mends.

n

Yet, in the face of these great
attainments—the greatest that the

unprecedented

that

made

He

calls

,

recommenda¬

every

President

for

estimates

Truman

spending.

more

that

has

various

pro¬

We

asked to

Joan the

$3.75 billion of new
money.
Other countries are de¬
manding loans and will be hard
to

refuse

if

granted.
tures

the

British

>:

loan

is

These foreign expendi¬
not all included as ex¬

for

living

that

nowhere

at

.

of

gree

living and the de¬
of freedom which these 157
have brought to the people

of these United States.

Indeed, it

institutions of individual freedom

and

are

*■

lesson^ ift history

no

that justify the recent and current
atempts to turn our country's
clock of progress backward—back
the

to

employment

evil and

that

danger to the well-being of the
individual and of a people in

penses, I suppose, because they
adopted will in¬ will conceivably be repaid. But
crease the budget during the next
whether they are included as ex¬
fiscal year by $3 billion. It is im¬
penses or not,, they certainly will
possible to tell how this total is increase the
public debt, because
reached.
There is every reason to
we have to borrow the money in
believe that it is not"
sufficiently order to lend it. The same thing
high.
He has recommended in¬ is true of some
$300,000,000 which
creased unemployment insurance
will be used for rural electrified
benefits to be paid by the Fed¬
tion which is not included in the
eral
Government, involving the expenses.
.

Federalization

6f

unemployment
He; has recomhigher salaries for all

compensation.
mended

:

;

Government employees, including
the

higher salaried positions, and
raising
all
Congressmen
and

Senators, I might
a

to $20,000

say,

He has recommended the

year.

extension

of

food

subsidies

after

July 1.
In this connection he
points out that the abolition of
subsidies

the

crease

This

would

actually in¬
living by 3%.
;; outrageous,

of

cost

he

considers

although he has recommended in
effect

>do

further average 20%

a

in

crease

not

wages

quite

see

should

sumer

than

in¬

salaries. '

why

not

rather

crease

and

the con¬
this in¬

pay

the

I

taxpayer.

Certainly, there is just

as

inflation

Govern¬

in

ment debt

increasing

as

there is in

much

increasing

He

has

recommended

in

crease

the

an

domestic

in¬

lending

program of the Reconstruction Fi¬
nance

Corporation and other Gov¬
agencies. He has recom¬

ernment

mended
mum

the

an

wage

present

increase in the mini¬

by

thorities,
thorities

90%

over

statutory rate which

took effect in

ommended

nearly

1940.

Missouri

Arkansas

about

$12.5 billion; and that does

not count the

distribu¬

generous

tions
through UNRRA and
through the United States Army,
which with the

spend

sums

we

should

for

Philippine rehabilita¬
tion, will total $5 or $6 billion

known to be

a

be

in

reasonable

live within its : own income.
The time has come.to stop both
Government ' spending and Gov¬

lending. If we continue
present course there are
only two alternatives, either our

densome

it seems to me the time has

when

we

further
to

our

must

come

recognize

that

loans are simply adding
V Government
expense.

no,

bur¬

it

is

the

to work for greater freedom for
the individual and
a
continua¬

ment bill to avoid,.',

It

is the

duty of Congress to
spending and lending.
Whatever the economic justifica¬

'

r

He has

Valley
Valley

rec¬

are most
unlikely ever to tion for such action in hard times,
repaid, particularly if made in there can be none when we have
great size like those we are now the greatest private purchasing
considering.
There' is no
our
markets
this
legal power over
way to collect a loan from a Gov¬
country—or the world—has ever

ernment and the

borrowing Gov¬

ernment knows it.

large

that

it

If

a

loan is

constitutes

burden on the people of
try, it will be repudiated

a

a

so

real

coun¬

as

were

We

seen.

fiscal

must

policies

We

must
we

hold

to

sound

order

to

avoid

in

inflation, booms
that

return

and

down expenses

the debts of the First World War.

Au¬

Furthermore, all this Government
lending contributes as much to

must

inflation

science, but to insure

Valley
projects

everywhere and the rapid exten¬
sion of public
power.
He has

as

any

spending.

It

places dollars in the hands of for¬
who rush with them to

eigners

so

stimulate progress
industrial
expansion.
We

Au¬

Authorities, reclamation

depressions.

can

and

and / Central




Govern¬

.

balance

satisfy

our

the

budget,, not to
New England con¬
a

permanent

condition of high-level
production
and

high-level employment.

a good social

organiza¬

tion.
V

■

•»

It

;

reasonably clear that

seems

i a government

ditions that would prevail if the
competitors had equal strength in,
competition. It seems quite clear,
that most if not all deviations,

from, this
ments

social

principle

have

by govern-,
injurious to.

been

well-being.

-

The application of this

principle-,

requires that monopolies be regu-n
lated, to the end that the condi-;
tions - of free; competition: may,;

prevail;
tected

that the weak be pro-;
against the strong, to the

end that that competition- may be
fair; that prices, with certain ex-:

ceptions, be neither fixed

nor con¬

trolled but the results of this free-,

and services.;^

'

The

appropriate' exceptions to-

to what is the proper aim of any

the

social

found in the necessity for the gov-*'
ernment to fix (a) the weight of,

organization, and what is
good type of government.

f;: (a)

It

seems

reasonably

a

clear

tributing

J other

fosters,
of,

limits

it of these goods

be

to

good government which:
only if it protects,
and operates within the
good

society's appraisal of the value to,

*

This conflict raises questions as

,

check both

i

cri-;

a

be

can

157 years.

sup¬

posed purpose of the full employ¬

teria of

and fair competition, to the end;
that they may reflect accurately >

social organization is good
if it does not, in addition to con¬

Government

aspects of a good
social organization appear
by im«
plication as we examine the

tion of the progress, with im¬
provement, that we have experi¬
enced through 'most of our last

,

Loans made abroad
by American
banks to business
concerns on a
business basis will
probably be
repaid. - But loans made
by the

Communist, or totali¬
some fornv—and less, or
private enterprise, and those

who want to arrest this trend and

balance the budget only by
further, inflation.
Either course
will bring the. very, hardship and

which

in

tarian in

our

depression

lessons
to be lost

Socialist,

to take all the life out

as

basic

who clamor for more government

on. our

of

the

country, we are experienc¬
ing a sharp conflict between those

system, check further ex¬
pansion, and reduce production
I am quite
prepared to assist
and employment, or we will go on
the devastated countries in start- ■
with increasing deficits until we
ing their economic machinery, but
can

more.

>

(b) Other

this

ernment

so

yet

these events seem
on
those who keep
clamoring for
more, not less, central govern¬
ment, and for less, not more, free¬
dom for. the individual. Today, in

country is going

system will become

courtesy

of these rules is found in whether,
not they tend, to foster the con-v

m

to

tax

It lies at

of that fine

human existence worth while.

keep themselves in positions
authority.

And

Government lending is just an¬
other form of Government spend¬

must

theme through

or

here.

It

a

probably one of the most vitally
fundamental elements that make*

Slogans,

in recent decades.

this country to buy the things
they need and compete with the
huge demand which has piled up

amounts if this

like

ran

•

general.

ing.

It

teachings of Christ.

with which the
refined persorf
deals- with his fellow men.
It is

programs, and policies
made to fit the needs of the

ments

by 3% the cost of living.
v

If the British loan is approved,
will then in effect have au¬
thorized the loaning abroad of

we

are

When
to enlarge this

,

devices

of

ways

we progress.

cannot aid in raising the general level of ..living irt
and destructive war that the world ; society' and protect and enlarge;
the scope of individual
has even seen.
In no nation did
liberty un«
it
fosters
free
and
fair
the people as individuals have an less
competition.
opportunity to vote for or against
this war. Their rulers decided for
Human beings apparently have'
them.
The liberties of people, never devised a better means of
already sharply curtailed by auto¬ encouraging. individual develop-;
cratic dictatorship, were progres¬ ment and social progress than
by!
sively and rapidly reduced to fostering equality of competition,
something approaching zero. Mil¬ impelled by the profit motive, and
lions had no choice but to lose by providing at the same time thetheir lives. Savings of a lifetime means of protecting / the weak
and
of
generations have been against the strong. There is prob-'
swept;/away. Destruction and ably no better means of determine
waste have seared the face of the ing the social value and proper
globe. /Debt has been saddled on prices of commodities and serv-?
the living to an extent never be¬ ices than free and fair competi-*
fore seen;
Taxation has' become tion. But free competition of itself
heavy and destructive. Bitterness is not enough; it also must be fair.
and hate and despair escape few And: fairness of competition im-%
people and homes anywhere on plies either equality in strength;
this earth.
This is the scourge or conformity to what appears to;
that autocratic leaders in govern¬ be fair rules of competition when,
ment have brought to millions and the competitors are of unequal
millions of people in this world strength. > The test of the fairness,

substantially accurate to say
that although it has been the great

There are*

step backward,

people into the most widespread

is

of autocratic governments*

a

new

the bottom

an

The ambitions of these autocrats
soon
clashed and they led their

the standard of

years

were

to

time : in the world's history have
ever enabled
a people to attain

grams he has recommended which
been

the

rulers who did all in their power

any

have

not

fact.

promises,

accomplishments pos¬
sible are now under severe attack
by those who would offer devices

freedom}

take

find

all

peo¬

„

portant religion in the world has
recognized and clung to this great

unconstitutional,, totalitarian form
developed

of central government
—even in this country.

by

recognizes, above
things, the sacredness of one's
personality.
Probably every im->

probably

toward

world probably has ever seen—,
the basic instruments that have

over

are

march

recognized

Such freedom

field which

and

the

such

all

an

before

safeguard

desirability:-of

are

freedom,

expected to have. Dictator¬
ships sprang up abroad and an

groups

British

saw

had

never~

are
told
that the
Export- urging that we replace these in¬
Import Bank will need additional stitutions of freedom with those

funds.

we

we

never

We

recom¬

'

"

Up to date,
tion

Truman

'

fertile

to

truly enlightened and free
ple, When wercurb" this

opportunity to
elevate
themselves, to become
bosses, to exercise power they

the

.

need

ambitious

history of the world.

private enterprise in this
country that have been employed
twice in the last
twenty-eight
years to ? rescue peoples and na¬
Bretton Woods Fund and Bank.
tions of Europe from the on¬
We have authorized the Exportslaughts
of
autocratic
govern¬
Import Bank to loan $2.8 billion. ments, we find vociferous

find, the money*
But we
to spend the billions

can

don't

a

and

freedom

to have caused

they have cultivated day and
night. History seems to have been
forgotten, or; not understood, or
misinterpreted.
The
politically

period and
of negro
slavery in this
country,
gradually spread
and
probably has attained the highest
degree
of
acceptability ever
in

found

and

freedom for his fellows.
The

justice

a

have

area

reached

capacities
same

large proportion of people,
here and elsewhere, have been
depressed, harassed,/tired, and
discouraged, political demagogues

and

during the next 12 months
to turn over $2.8 billion in
gold
and $1.25 billion in cash to the

ing and education ought to be im¬
proved in prosperous times when

such

importance: of
individual, regardless of in¬

tus,

a

many
people to lose their per¬
spective.
In a situation in which

and to in¬

preserve

sum¬

general head¬
shortsighted view of

severe wars, seem

government

competition.

freedom

perhaps be

thirty years. The
economic depressions and dislo¬
cations caused chiefly, perhaps, by

should lay down and enforce such
rules
and
regulations
as;; were
sure

of

can

cluding the freedom necessary to
develop his personality' to the
limits of his
physical and mental

events in the last

virtues of free and fair competi¬

ernment

hous¬

ing

widespread belief in the

•

people

struggled for ages to enlarge the
scope
of individual
liberty, in¬

against which people throughout
history have struggled to free

made these

as

that in the fiscal year 1947
no

of reasons for
this reaction toward those
things

possi¬

herited qualities or economic sta¬

a

Forty Million Partners

multitude

ble, rested upon the corner stones
of
private property, freedom of
contract, freedom of enterprise,

the

which

billion deficit.

these

care,

compulsory

program

$3 to $4 billion

ally need it and

to

crack-brain-economy theory
that spending Government money
can
speed up the economf; ma¬
.

insurance

last year when

some

chine.

health

will bring from

a

public debt..
If this were true,
the only reason is that wb bor¬
rowed the money in November

expenditures, un¬
improve the condi¬
tion of low income groups and not
undertaken / simply
because
of

*

recommended

there would be

welfare

dertaken

has

sage

different feeling about

a

grants for all- public
only be justified on the
theory that prosperity can be in¬
creased by more spending.
He

Spending

do not for years, pub¬
lic works ought to be undertaken
only because they are worthwhile
I have

inter¬

The President said in his

we

and immediately

aid

'

and of making work.
Unless we
face a real depression, and ob¬

viously

a

such progress

tion, f the generally/ accepted
theory and practice of govern¬
where

Lending Has the Same Effect

spend

works

for

which made

The

objection to

can

created

have

to

seem

theory that

depression

distinct Federal

a

whatever

tendency to reduce private spend¬

the

but

works

the

a period when we
private purchasing

available demanding to be
used, we should hold back on pub¬
lic works and prepare the plans
the

est,

is

ment

electrification.

power

for

there

up

in the fiscal year 1947.

of

few years.
I have no
Federal
grants and

than that.

(Continued from page 830)

Thursday, February 14, 1946

that

no

to

the

material

well-

being of a people in general, pro¬
liberty.

tect and foster individual
1

For

centuries,
people
have
fought perhaps as strenuously for
liberty as for material goods. One
may find food,
shelter, clothes,
safety, and security within the
walls of a prison, but at the price
of liberty.
Many men have sacri¬
ficed all their worldly goods, and
even their
lives, to obtain free¬
dom.
Individual liberty has in
general been considered a price¬
less heritage.
It has been man's
perpetual
aspiration.
He
has

and

rule

against price fixing

consequently

the

the metallic unit used
ard

in

(b)

the

for,"

price
as

a

are-

stand-'

its

monetary system, and*
rates charged by public;

and private

monopolies which
to operate in lieu
competitive - enterprises.
It

are

permitted

of
is
probably, desirable, also, for a
government, in time of war, to fix;
prices of those products in which
a rise in prices will not bring an
increase in production,
v.vv.v-..'
"Free

and fair

not function

competition

the

can-"

properly unless there *

is both economic and

'mocracy. In

•

a

political de-,'

political democracy,

individual is free to

political votes

as

cast his"

he thinks best/

-

Volume

Number 4464

163

an

democracy,

" economic

neither

can;

the

operate well if

other is restricted in any

erable degree.

consid¬

,

how

economic democracy has been

our

impaired—how our freedom to
spend our dollars for goods and
services has been curbed.
Taxes
t&ke from us by compulsion much
that

we

©Wri

would like to use in our

interests

or

as

pur

desires

Rationing and price-fix¬

suggest.

ing; and the inability to get the
customary
goods' and x services,
have

placed sharp limits upon

the

operation of economic de¬
mocracy in this country.
And, as
one considers how the taxpayers'
proper

funds have been

In

disciplinarian,

of

having long and practical experi¬
general public.
Some economic
questions are as intricate in nature
as
those in the fields of the so-

practically all but two fields
activity we as a sup¬

Our

battle.
to be g

have

people

intelligent
steadily to

end trial by
are supposed

courts

monument to the substitu¬
intelligence for force; and

tion Of

the

people who provide it with
its authority, open the door to
Socialism—a form of government
which cannot meet the objective
tests as to what constitutes good

these courts in many respects are

authorized to reach into the inner¬

of our private lives.
have

most aspects

But in two large areas, we

persisted in retaining the primi-' government. Unless this principle
tive system of trial by battle: One
is recognized and adhered to, we
is in our international relations, have no criterion by which we can
define the extent to which a gov¬
and at present we are hoping that
the instruments of peace and jus¬ ernment may appropriately enter
tice will finally be substituted for into competition with citizens or
war.
The other is the field of in¬ deprive them of their opportuni¬
dustrial or labor relations.
But ties to make a living without be¬

cannot have

coal," another says we cannot have
steel, another says we cannot have
automobiles, another says we can¬
not have foreign music, another

used by our gov¬

livelihood, and they do not, in
principle, willingly organize an
which will deprive them
of these oportunities.
Those who regard this princi¬
ple as questionable, or who sug¬
gest that the State should be free
at its option to compete with, or
to enter into "partnership" with,

human

posedly

struggle and social and economic
disruption, not cooperation, are
some
of - the results. * Today we
have. a situation in which one

cannot have bus trans¬
portation, another says we cannot
have telephone or telegraph serv¬
we

says

and

ing.

human

worked

In large degree, govern¬
compulsion» has
replaced
encouragement of incentive. The
task of the job provider has been
made harder, not easier.
Class
ment

are not sub¬
economists and others

transportation,

People do not wish to be
deprived of opportunities to gain
a

for
sad

a

intelli¬
and the state of our civili¬
on

zation.

of the job pro¬

labor leader says we

is

defended

be

can

commentary
gence

provisions

agency

strikes

vider,

.

On all sides today we see

seeker, and as the
if not the enemy,

that

fetish

rent

the- government that has allied itself
individual is free to vote his dol¬ largely with one agency of pro¬
It
lars as he prefers. - Democracy is duction—the employee group.
has set itself as the champion and
incomplete in so far as either of
these aspects is impaired, and friend of the job receiver and job
In

859

THE COMMERCIAL & FINANCIAL CHRONICLE
,

here we seem to be doing little or
ernment, it should be easy to ice^ and so on and on this sort of
nothing beyond fostering warfare.
understand in' what respects this dictation continues and spreads.
There is nothing good that can be
impairment of our economic de¬ Probably no one can now say with said for this manifestation of hu¬
any assurance where it all may
mocracy has also impaired our
An objective look
lead.
But its unfortunate aspects man stupidity.
political democracy.
should be obvious to all mature at our policies, practices, and war¬
: No government* no government
and thoughtful people.
It is a fare in the field of industrial
organization, no government bu¬
manifestation of the consequences relations should reveal that in so
reaucrat or collection of bureau¬
far as fundamentals are concerned
crats can begin, to compare in naturally flowing from the en¬
thronement of demagogic politics we have not risen, in this field,efficiency or in intelligence with
in this country.*High-minded, neu¬ much, if any, above the practices
the mass of people who are free
of the lower animals and primi¬
to vote their dollars as they think tral, even-handed, and intelligent
tive men.
best:
Producers can never obtain statesmanship is. for the present

ing employees of the State.
When

a

in

a

a

called

exact

opinions

re¬

garding the best solutions may be
even longer than that required of
the chemist or high-grade physi¬
cian, Nevertheless, these are facts
often overlooked by government
officials.
Because the economist

•

its
citizens,
or
government monopoly
in which private

monopoly

ownership for regulation.x This
is an admission that, as a regula¬
tive agent, it has been unsuccess¬

or

governrtidnt's function

regulate, not to own, busi¬

VIII

such

specialized symbols as
characterizing
chemistry,

those
the

layman

that

he- is automatically

to

rather

language,

common

uses

than

generally

supposes

admitted

understanding of most or all

an

economic principles.

Consequently

governments, unless they are very
wise, often arrive at their answers
to, and policies regarding, eco¬
nomic questions of major import¬
not by consulting the most
competent and objective econo¬
mists, but by arranging for the
general public to vote upon the
issues or by submitting the ques¬
ance,

tions

to

a

group

in fact

may

*who

economists

themselves

may call
but who

nothing but de¬

be

visers

of, and agitators for, the
policies which they think will
help the government, of which
they are a part, to remain in
power.
The same is true of im¬
portant and really intricate mat¬
ters in constitutional law, sociol¬

ness; and, ownership and operation
guidance: than that given practically dead in this country in
of a business by a government are
A good government will exer¬
free to spend so far as its effectiveness is con¬
cerned.
A relatively small group cise only those powers granted to more difficult and create more
their dollars for 'this and with?
hold themirom that.
Buyers can of genuine statesmen in Washing¬ it by the people being governed. problems for all concerned than
ton and outside have been and The State is the organic agent of does government regulation. Gov¬
never be* served as well as when
still
are
fighting valiantly for society, created by that society to ernments rarely count with any ogy, political science, and interna¬
they can vote their dollars as they
even-handed justice and a coop¬ promote its best interests. Thus a high degree of accuracy their tional law.
"■ r
'■
please and when^producers must
erative society, as against a gov¬ government
which is
granted costs of doing business; their losses ; r It is the duty of an intelligent
respond to these indicated prefer¬
are levied upon the tapayers; the
ences.government to submit all such
Apparently every depar¬ ernment that allies itself with one powers, usually in the form of a
constitution, for the purpose of forces which usually exact penal¬ questions to the best trained peo¬
ture from this method of buying group and fosters a class struggle,
ties for inefficency4n management
but these Statesmen are fighting aiding
society in attaining; its
and selling injects elements of in¬
ple at its dlisposal and then to
with
their backs to the wall. aims,
cannot step beyond the and in service practically cease to take appropriate steps to inform
efficiency, waste, and maladjustWhether they can win ultimately scope of the authority granted it operate; and society suffers as a the general public regarding these
emnt.
A heavy burden of proof
against the multitudinous devices by the society from which its consequence.
matters of which a very large pro¬
rests upon those who, in periods
that characterize
the huge and powers are derived without ceas¬
There are limits beyond which portion of the people have no clear
other than war time, when malad¬
far-reaching demagogic political ing to be a good government. cooperative activities through the understanding. A government be¬
justments and regimentation are
monster that2 now holds our peo¬ Briefly stated, a good government agency of the State bring more comes particularly untrustworthy,
the order of the day, would inter-?
will be a constitutional govern¬
disadvantages t h a n advantages; and even extremely dangerous, as
fere with the free operation of ple in its grip and is sucking the
nation's r life-giving blood away ment.
It will neither exercise and it is at this point that the an agent of the people, when it
economic,; as well as political,
seems to be an open question.
powers1 nor engage in interfer¬ State should cease its efforts to act not only submits involved ques-^
democracy.
ences with4 social practices when
for the people as their cooperative tions to the incompetent general
The power of one individual
such governmental acts
exceed agent.
i
public for a vote on what the an¬
over another is an insidious and
A good government will pro¬ the provisions of the organic law
swers
should be but goes even
A very large proportion of hu¬
corrupting thing. It places a great
vide those agencies that ensure according to which society has man
further and appeals to the emo¬
activities can,
with great
resnonsibilitv- upon - ■ the person
peace.
Cooperation among the decided that it expects its govern¬ advantage to all, be left to private tions of the untutored people, jor
With whom the power rests. Where
enters into a deal with groups
ment to be guided.
economic and political democracy agents of production, exchange,
arrangements in which people are
land cohsumptibn and in sharing t Much has been written and said free to enter into contract; to ex¬ having large voting strength, in an
operate freely
and, fully, .the
the n a.ti o n a 1/ income requires about the extent to which we have ercise their
ingenuity in produc¬ effort to; obtain a vote that will
power of one individual over an¬
When conflicts of^ interest; departed from constitutional gov¬ tion, invention, and discovery; to maintain the party in power, even
other is sharply curbed. Power is peace.
though this be at the expense of
appear, they must be eliminated ernment in this country. It is pop¬
pursue their pleasure in music,
widely diffused, and it is difficult
quickly by means of devices, that ular, today, to deplore any raising art, literature, entertainment, and the national welfare.
to concentrate it if economic and
will provide justice -and mercy, of
In early times, when a pesti¬
questions
about departures recreation; to choose their Tfiends
political
democracy have free
and restore peace. In general, this from
our
Federal Constitution. and associates through the organ¬ lence appeared, some*savage tribes
play. Furthermore the system of
means that courts must be pro¬
Some even say that Constitutional ization of clubs, fraternities,: part¬ would
beat
their tom-toms to
incentives, instead of government
vided to which people with con¬ Law is dead; : Any group of citi¬
In
nerships, and similar' organiza¬ drive away the evil spirits.
compulsion, plays its beneficent
flicting interests may repair, since zens ^organized to press for a re¬ tions ; to organize for religious modern times, we have learned to
role.
-'

better

when all buyers are

,

,

"

the

and

sciences,

valuable

render

to

enterprise could be as efficient or
more efficient than the State,
it

is to

but to the

matters

economist before he is competent

business

ful; Yet the

these

period of training required of the

State enters into com¬

substitutes government

to

in

ence

with

petition
creates

<

mitted

.

.

vi

r

enlightened<■ government,
earnestly striving to increase the
well-being of society, wUl recognize and, conform to the fact that
An

'

society is a cooperative enterprise.
All agents engaged in the/ pro-:
•

adjudication offers more promise
of ensuring justice than does re¬
sort to force, except as used by
the State to enforce those of its
laws which are based upon the

principles of equal justice for
mercy, and peace.

all,

constitutional government

turn to

likely to ;be jeered and, at¬
tacked and ridiculed. Oaths taken
are

by government offcials to abide
by and to uphold the Constitution
appear to have lost their original
meaning.
Their violation is ig¬
nored or laughed at or excused by

purposes

their churches, syna¬
cathedrals, and
taber¬
nacles;
to pursue knowledge
through the establishment of edu¬

call in medical authorities when a

gogues,

pestilence strikes us; we do not

by

economics, sociology, and political
science, we are hardly safely be¬
yond the tom-tom stage in the de¬

cational

institutions;

to

save

creating savings and insurance in¬
stitutions; to engage in humanita¬

rian activities by establishing hos¬
In recognition of these facts, a
and consump¬
cynical and supposedly smart re-: pitals, the Red Cross, foundations,
services, and good, government will never cease torts. Much of this cynicism and and
eleemosynary institutions.
cultivating and improving upon
in the distribution of the national
the: devices and rules which aid low regard for the pledged word
Government is not an end; it is
income both compete and cooper?
in high places has diffused itself
a means.
Its function is to serve
cooperatioif'fand' a better under¬
ate with one another. > In produC?
standing of v its necessity and vir¬ in a multitude of ways throughout the society which Creates it.

duction, exchange,
tion of ' goods: and

■

employers, employees, and
tues,
owners of natural resources and

tion,

must cooperate.
and it is as
futile to argue that one of these
agents of production is more im¬
portant than the others as it would
be to contend that any one leg
of a four-leg table is more im¬
portant than the -other three. x x
The
better
the; cooperation
among the agents of production
and consumption, the better is
capital equipment
All

the

are

society pro¬
of free and
competition does not militate
well-being

of

A fostering

moted.
fair

necessary,

cooperation. Indeed,
the converse is true. The smoother
the competition, the more effective
is the cooperation.Cooperation,
under conditions of free and fair
competition, becomes practically
automatic and largely devoid of

against such

conscious effort.
tion

When competi¬

freely and less
cooperation becomes more

operates less

fairly,

difficult and

requires a progres¬

sively greater

amount of conscious

effort.
In this

„

-neutral

will always

position with

occupy

production in
fact

the
that

that

all must

all

to have suffered a severe

necessary,

cooperate, that all

through the smooth operation of
free and fair competition and the

consequent automatic and

largely

unconscious cooperation.

part of the class struggle,
which the majority of the Fed¬

eral

a

Socialists, and Commu¬
pitted against our other
social groups, we find widespread
acceptance of the common asser¬
are

tion that strikes must

not be pro¬

is superior
then the notion
valid defense
lockouts or picket¬

hibited. If intelligence
to

brute

that

force,

there

is

for strikes or

ing

or

some

some

similar and related

manifestations of force is without
any

in

rational foundation. The cur¬

decline

Cynicism

popular acceptance.

cheat¬

and dishonorable dealings,

ing und lying and stealing are
rampant.
A large proportion of
this
moral
and
ethical slump
seems to have stemmed from gov¬
ernment

?

Constitution, ig¬

nored their oaths, and
most

known

every

authors

whose

policies

have flouted our

intellectual; honesty

integrity,

violated al¬
standard of
; and
moral

,

IX

government and most labor

leaders,

nists

vital

agents

equally entitled to justice; and
chat- tnis justice probably can be
obtained in no better way than

in

Belief in vthe

.

orable dealings among men seems

are

As

nation;:

of any;

recognition of
are

our.

respect to importance of honor and of hon¬

the importance or interests
one of the classes
of the
of

a.

.

country today we have a




It

A good
take

no

formed

government will under¬

activities that
as

well

or

can

be per¬

better by pri¬

vate individuals or associations. A

fundamental

of govern¬
ment is to provide society with
the regulations and the enforce¬
ment

of

purpose

these

regulations, which

this society desires, as a means

protecting

individuals

in

of

their

efforts to live and to make a liv¬

'

x
'
:
'
good government will seek
competent
advice
on
intricate
matters. Every government is con¬
fronted with a wide variety of
questions. They may involve mat¬
ters falling into the provinces of
chemistry, physics, geology, me¬
chanical engineering, hydroelec¬
tric engineering, civil engineering,
naval and military affairs, eco¬
nomics, constitutional law, insur¬
ance, and so on.
No government
is ; wise, nor is it pursuing 'the
proper course, when it submit!
questions of chemistry to those
who are not competent chemists,
or engineering questions to others

tom-toms; neither do we yote

use

the

on

vices

issue.

used

the problems

of these issues, and pretend
have

we

voted

them. Before

on

to

We contrive to vote on

involved.

that

in matters of

arrive at the sup¬

solutions

posed
many

to

But

we

intelligently

cast

our

votes

the

political t tom-toms beat, the
public is stirred, if possible, into,

.

A

than competent

engineers, or eco¬
questions to other than
competent economists.
;

nomic

In the fields of the exact sci¬
this principle is ordinarily
recognized, but often, if not usu¬
ally, matters of economics, such as
questions involving money and
banking, tariffs, public finance,
labor, agriculture, public utilities,

emotional

an

slogans

are

frenzy, flags wave,

used to hypnotize, agi¬

tators and voters march and sing
and -shout, the demagogues and

patent medicine men orate and
praise and condemn, the scientists
hang their heads in shame. Then
the votes are cast, and the word
goes out that the correct answer
has been given.
This voting is
widely supposed to solve all prob¬
lems

no

matter

or

Those in

speak of a mandate, and
this mandate is not only assumed

power

be

to

often

specific and wise but it is
stretched to satisfy some

caprice of those in power.
Resort to

these

devices reflects

badly upon the government which
employs them, and the dangers to

,

ences,

how intricate

technical they may be.,

society that
use

are

are

involved in their

incalculable. When

a

gov¬

ernment

indulges in such prac¬
tices, the intellectual resources of
a
country are not properly util-

(Continued

on

page

860)

THE COMMERCIAL & FINANCIAL CHRONICLE.

860

A Hundred and

Thursday, February 14, 1946

Britain As Lender

Forty Million Partners

•

(Continued from first page)

.

(Continued from page 859) ■ -j may be an undermined confidence
in the virtues of competition and
ized, the methods employed are |
almost
certain
to
lead to the self-reliance, and a lack of under¬
standing and perspective regard¬
wrong answers and policies, the
government ceases to be a reliable ing the unwise acts of govern¬
ments in contributing to economic
agent of the people, and the pros¬
pects of
ensuring the effective and social maladjustments. What¬

is that he is liberal about.

i

of

functioning

government
paired,

representative
seriously im¬

a

are

■

,

intricate questions to
the untutored rather than to the
tutored is social folly; and to leg¬
islate for the benefit of pressure

laws are
slowly breaking our backs.
They
have

brought

us g

upon

greater

progress.

are

moving

criteria

basic

the

to

as

directions; a

of freedom in many

what constitutes a good social or¬
in relation to that

ganization and a good government
organization are

widespread ; pessimism and fear
regarding the future; and the con¬
sequent development of a great

clearly understood and accepted,
difficult to

more

profitable examina¬

enter upon a

bearing

is

ty-1 Should be undertaken by pri¬
vate enterprise or by government,
whether certain regulatory de¬

economic, social, and polit¬
Indeed, the increasing
burden of these laws, combined
with the. danger of impairing our
public credit and with numerous

in bur

wise or
unwise.
Furthermore, eyen with
accepted criteria before us, there
appear to be a considerable num¬
ber of problems regarding which

ical

their closest students find it diffi¬

national well-being, may prove

cult, becouse of inadequate evi¬
dence, to state with a high degree
of assurance what the best or
proper answer is.
It is for these

principal factor which will
destroy our republican form of
government and throw this nation
back to some form of autocracy.

vices of government are

other forces now undermining our

here in deference

over

viewed

as

>

examine them

we

drift

away

otherwise.
When difficulties

arise, the first
reaction of people, in general, is
that a law should be passed. There
appears to be an increasing tend¬
ency to pass more and more laws
with

respect to more and more
things. This has become strikingly
of

true

At;

Federal

the

sessions

some

thousand

or more

government.

of

Congress

laws

are

a

passed.

The accumulation of statutes, par¬

ticularly

during

recent

is
6ne of the amazing commentaries
on
modern times.
Our present
faith in the efficacy of lawmaking,
especially ip the value of thou¬
sands of laws that

are

years,

neither read

understood by a large propor¬
tion of our people, presents a

nor

problem for the social psycholo¬
gist. We are being swamped with
laws; we have so many on our
statute books that

we

do not know

what they are; the general public
makes
no" pretense
of reading

them; we do not know when we
violating or obeying them, and

are

yet there
for

more.

We
tion

or

only

we

nomic

persistent clamor

-

.

living

are

frenzied

a

is a

in

a

period

superstition being that if
can pass a law—its eco¬
often

being not

paramount consideration

problem

problems

or

solved and
our

of

legislation, the vague no¬

soundness

we

—

will

our

be

shall be saved from

troubles,

One may

sible

advance several plau¬

reasons

for this

remarkable

faith in the virtues of statutes that
are

neither

generally.

read

nor

understood

Among these




.

.

with

unfortu¬

our

nate, if not dangerous, drift away
from. the principles of good gov¬
ernment and our remarkable reli1

ance

upon

eral welfare.
to

seem

Nor do many

people

today to consider

pause

be reacting against cor¬
ruption, dishonesty, and stupidity.
We prefer to read our labels and
run
rather
than
to
distinguish
between poorly-considered emo¬

historic

a vague

the

United

path

States back along

toward

autocratic

those, on the one
hand, who are clamoring for more
government coercion and are try¬
ing to head this nation in the di¬
rection of social retrogression arid
those, on the other hand, who are
fighting for an improvement in
economic

our

and

well-

social

being by protecting and widening,
if possible, the scope of individual
freedom; who are. fighting for a
wider recognition of the sacredness of the individual personality;
for free and fair competition, with
monopoly watched and controlled;
for political and economic democ¬
racy; and for a constitutional gov¬
ernment that will, operate in, ac¬
cordance with the standards of
goodness which have i been pre¬
sented

hereg

briefly g and, of

go

;

reasons

undermining our general social
health and well-being, and point¬
ing toward some form of social
retrogression.
They clearly indi¬
cate an increasing amount of coercion, much of which is undoubted¬
ly of an undesirable sort.

affiliates; New York Curb
Exchange Realty Associates, Inc.,
and
New York Curb Exchange
Securities Clearing
Corporation,

1944.

made

amply clear that those things
which do not raise the general
level of living, and which impair,
rather than enlarge, the freedom
of

the

individual,

are

retrogres¬

Most unfortunate¬

sive in nature.

ly, this spreading spirit of coercion
and retrogression, in recent years
and
today is frequently called
liberalism, and the advocates of
this coercion and authoritarianism
often call themselves Liberals. But
this

reversion

the

is

coercion

to

antithesis of liberalism;

it is illiberalism and retrogression.
The
philosophy of these self-styled,
but false, Liberals is that the in¬
dividual must be regimented for
his

sake—a

philosophy that
tyrants, dicta¬
tors, ahd coercionists throughout
human history;
True liberalism
has been associated with that long,
own

has

characterized

painful
free

struggle

itself

of

from

humanity

to.

regimentation,

coercion, and authoritarianism.
People
States

today
well

as

fallen

—

as

in

the

United

in Europe—have

under

914.

470

$15,869 from 1944. ; Listing fees
rose $54,084 to
$85,751, and ticker
royalties improved by $6,387 to

Rent revenue also im¬
proved with income for 1945 from
that

totaling $135,166, com¬
pared^with $132,725 In 1944. source

It is added

for 1945

mark it down

the faith

as

bad at once. The

revealed

in labels is

is

amazing;

tragic.

Current

assets

were

$667,321

the

at

$720,765,

was

in cash.

close

of

of

which

In addition,

the

Exchange has an investment
of. $750,000 in U. S. Treasury ob¬
ligations,

accrued

interest

Which, at Dec. 31, last,
Current

liabilities

equity

of

memberships

in

as

the

$802.
$116,451.
regular

was

were

the

on

499
end

of

1945

$5,174,557 or $10,370 for each
as against respective
figures

1944 of

$4,857,393 and $9,734.
The mortgage on the Exchange

was

reduced

;

People in general do not stop to
ask the

that total expenses

were

$1,132,112 up $198,865 Over 1944. Salaries, the largest
item of expense, rose $164,888 to
$606,182.
Legal fees were also
higher, $69,862 in 1945, compared
to $44,389 in 1944.
1945

1945,

and

self-styled Liberal what it; $400,000.

at

1

by

$120,000

Dec.

31,

during

last,

of loans
purchases of

or

avail themselves of their right
to... convert
their: sterling ; into
currencies?

other

mainly
what

extent

This

depends
(1) To

factors:

two

on

Britain

will

be

able

extent will
to

:•

British

with

compete

other

goods be able

American

and

goods?

overseas

The reconversion of British in¬

dustries

for

peace-time

require¬

is making slow but steady

ments

And internal consump¬
kept down with iron hands,

progress.
tion is

in order to be able to export.

In

the West End of London it is dif¬

ficult to buy certain types of hats,
because the entire supply has been

port is limited, andjchould be

sold

against credit. It is
true, France has to pay in gold for

for cash, not

one-third

of

the

windows

there

packed

are

with

The amounts British goods the likes of which'

exchange position.

of British goods available for ex¬

amount

her

of

have

not

been

home

at

seen

for

If this policy of austerity

years.

be maintained in spite of its

can

unpopularity, then the increase of
British

of

production
will certainly

civilian

debt; but had the goods been ex-

goods

ported to other countries the Brit¬
foreign
exchange
reserve
would haVe benefited to the ex¬

creased exports during the period
of world-wide scarcity of goods.

tent of considerably more v than
one-third of the amount involved.

lieved,

ish

,

;

-

lead

in¬

to

Once the scarcity has been re¬

hpwever, continued ex¬
porting capacity will depend oa:
relative costs of production ^
In
above
instances
a
case this respect the outlook' is
utterly
could be made out in favor of be¬ uncertain.
Wages are rising every¬
ing generous.
A relatively mod¬ where, but he who ventures a
in

Admittedly,

the

each
of
strong

.

erate amount of financial support

forecast of their

to Greece

Britain arid the United States is

might make all the dif¬
ference
between
stability
and
anarchy
in that key country.
China certainly deserved all the
support she could get. The activ¬

relative

in

rise

a

very; bold prophet indeed.
It is
therefore entirely impossible to

the extent to which the

foresee

Restoratioriof the convertibility ■of)
ities of UNRRAJ are wital for .the
sterling obtained through British
survival of European civilization,
foreign loans i and British import
and the United, States cannot rea¬ surpluses will lead to a decline of
sonably be expected to bear, the
entire burden.

Finally,; France, is

was

time to

help France to con¬

the; British foreign exchange 're-J

serve, g

In'such? circumstances the;

granting of1 foreign

loans ' seems:

very/much; like issuing

a check'
knowing whether there is

without
a

balance in the bank to meet it.

position.

nevertheless necessary to ask; Can
Britain afford it? These four acts
of

was

generosity—and

there/:

bes'des—must

others

have

are

cost

Britain quite an appreciable loss
of

foreign exchange.
This at a
when Britain, itself has be¬

time

the largest debtor nation in

come

the British
trade balance shows a huge deficit,
to be covered by* further borrow¬
ing,
Ore }$ tempted to conclude
that P r? t ain ha s not yet fully Real¬
ized that after hiving played the
part of a lending nation for cen¬
turies, it has become a borrowing
nation.
Perhaps this is yet an"other pi'Nce of evidence showing
history,

when

and

Britons

that

they

$25,391.

seat

gullibility

than the amount realized

Telephone quotation ser¬
vice gross income was $74,656, tip

was

will

was

in 1944.

thing conserva¬

a

tive Or reactionary, and they

of

in 1944

more

it as though hyp¬

cate, oi; pursue
notised.
Label

$143,169 for
$1,341,026 last

$74,512* The
Securities Clearing Corporation's
1945 income of $347,622 was $156,-

Net

a

Income

penses

the spell of words.
thing liberal, and the un¬
thinking people will follow, advo¬
Label

against

exceeded expenses by $208,Excess of income over ex¬

year

Time and experience have

it

net increase for 1945 of
as

through British
their goods—likely

ing
to

Having admitted all this, it is

The New York Curb Exchange

$317,165

recipients of

are

of it had to be spent

same

and its

a

an

And even if the whole exported. ;; Travelers
returning;
in Britain it from Scandinavia say that shop

ing Area.

would have affected adversely the

solidate its

showed

Sterl¬

essential, to cement
Anglo-French relations and at the

Report Mel Increase

indicative, father,1 of an insidi¬
social disease which is slowly

which could be spent in the

and, it

The fact seems to be that they
ous

.

Britain's closet friend in Europe,

N. Y. Curb Affiliates

are

purchase of British

the

to

goods.. Above all, there was the
Financial
Agreement, concluded
with
France
last * year,
under
which France obtained a sterling
credit of
£ 100,000,000, part of

xni

Often they
marks of liberal¬

pointed to as
ism in this country.

fined

The battle in this country today
between

Chinese

purchase outside the United King¬
Nor is the use of the Brit¬
ish contribution to UNRRA con¬

of the

is

part of ' the

and

dom.

govern¬

,

China,

ed, to

the

individual, and social retro¬
gression.
'

To what extent

on

reserve,

amount was available for

ment, with its increased coercion

solve our necessity* inadequately.
widespread* notion

are

war a

word used by

-

During .the to deliver goods wanted by foreign
£ 25,000,000. loan was grant? holders of sterling? (2) To what

exchange

meaning.

Socialists, Communists, advocates
of so-called government planning,
and by a variety of others who
are
trying to lead the people of

transactions with forr

eign Government liable to affect
unfavorably the British foreign

the word liberal has been dissoci¬
its

*

.

This is not an isolated instance
of financial

recognition of the widespread
thoughtless reliance upon labels,
from

restrictions
the use of

the loan to Greece.

In

ated

j no

would be imposed on

may

tions and careful thinking.

that

•

ing of foreign. loans, only
infinitely larger scale.

emphatically sterling—Whether through grant¬

Secretary

Foreign
declared

the possibility that the Reaction¬

statutes -to

of progress.

tomatic

from these
criteria of a proper social organi¬
zation and a good type of govern¬
ment—assuming the soundness of
these criteria-—, another phenom¬
enon has become conspicuous:
It
is the. reliance of our people upon
Jaws—not law, but laws—to solve
their problems, whether business
our

f>.

-j.

.

little concern

problems is a
that both developments are symp¬

f

XI

or

.

Connected

basic

some

after another,

In

1

*s.

XII

principles against which it would
seem that these problems should
be

',*

-

•j.

confronting this country

examination of

to

be the

that the several large is-

passed

one

life.

wishes to

possibility that he may
wish to conserve the very things
that contribute most to the gen¬

down

question arises as to whether
in the end of this piling of law
upon law1; may, not crush much or
all that is worth while and healthy

he

that

part with dollars by granting a
foreign loan that is freely con¬
vertible
into
dollars.
Yet
the
to

about the

heavily upon us each. year.

The

activi¬

tion of .whether this or that

which

weight

; it becomes extremely

sues now

is

There is

conserve.

aconspicuous
disregard for economic principles;
a
growing and disturbing com¬
plexity in life and business; a loss
self-reliance;

and

in this direction,

an

it

and disintegration.
thoughtful people

who believe that we

are

what

Today it is

There are many

to

ed

manship; an insidious attack upon
the virtues of hard work, thrift,

retrogression

reasons

Nor is the Conservative often ask¬

sufficient to lead
period of social

forces

the nation into a

:

himself

among

in dis¬

people's money
and his friends.

other

Indeed, it may set in

good government, impairs
social health, and retards human

mines

or

tributing

heavier taxation; an un¬
precedented and mounting public
debt; more governmental super¬
vision; a growth in bureaucracy; a
pronounced trend toward personal
government;
a J development
of
class
consciousness, class strife,
and class hatred; a startling spread
of demagoguery in politics; a seri¬
ous
decline in objective states¬
costs;

policies and solutions cnostitute a
social cancer which slowly under¬

;■

center chiefly

to

sems

ary

and in accordance with the
Strength
of
their
pressure
is
equally indefensible. Both meth¬
ods
of
developing
government

Until

a

At the same time, these

groups

.

become

have

to

be, we seem
nation of law

may

reason

worshipers.

i

To submit

rnotion

the

ever

it

|( Often

are

As

a

never

know

when

Williur Frederking Is
With Earl G, Fridley
HOUSTON, TEXAS—Wilbur H.
Frederking

has

from

duty

been

in

released

the

armed
forces and will be associated with
Earl G. Fridley Co., First National
Bank

Building. Mr. Frederking in

thd~ past was with A. W. Snyder
& Co., Inc., of Houston, and was
manager
ment

Louis

of

for
Co.

been

the

the

trading

the

Bank

depart- ■

Metropolitan

Prior

with

merce

thereto

St.

he had

Mercantile-Com¬

&

Trust

Co.

of

«

St;

Louis.

beaten.

matter of fact, the amounts
the foreign transac¬

involved! in

Money in Circulation

mentioned above

tions

active

nificant compared

are insig¬
with the loss of

foreign exchange Britain exposes
itself by accepting the policy of
multilateral trade based on the

The

Treasury

Department

Washington has issued its
ary

monthly

in

custom¬

statement

showing

.

free

convertibility of sterling; Tn

conditions a very large
proportion of the trade deficit
automatically leads to a further
existing

increase

of

not

freely

crease

the

As

balances.

foreign sterling
balances "are

these

convertible,

does not result in

their /in¬
a

the amount of money in circula¬
tion

after

deducting

those of Dec. 31,1945,

will

large proportion of

sterling balances obtained in

System)

dollars and other

currencies.

This

was

,

$28,514,518,195

1945, and $25,307,152,635
1944, and

698,214,612

on

compares

before

the

outbreak

of

foreign exchange reserve in pre-

World

War, that is,

on

cotriD

\ir-jv'

Ac

cfrunt-

1914, the total

on

Dec.

with $5,-

Oct. 31, 1920. Just

the British

would of course affect

as

against $28,210,962,369 on Nov. 30,'

oayment for export surpluses to
Britain would be converted into '31,

/.;nni,r

course,

ber banks of the Federal Reserve

it

tion of the Washington Agreement
the

of

that held in bank, vaults of mem¬

after the ratifica¬

twelve months

very

(including

become

ble—as'indeed

a

are

and/ show

decline ; that the money: in circulation at

the

—then

money

agents. The figures this time

foreign exchange reserve. !that; date
Should sterling become converti¬

of

the

held in the U. S. Treasury and
by
Federal
Reserve
Banks
and

was

the

first

June 30,

$3,459,434,174$

naiw

i^SSsp

.Volume 163;:, Number 4464,

\

.

...

861

CHRONICLE

THE COMMERCIAL & FINANCIAL

•

far

Declaration, which is that the Big

Policy

The Course of Our Foreign
(Continued from page 837).

r

1" fighting
for this

for

democracy.

that

our

fellow

It was
citizens
If

suffered and died in battle.

do not establish the

which

principles for

but

In

the

a

The; Atlantic Charter
The Atlantic Charter, issued by
Prime
MinisterChurchill
and

for h Great
Britain and the United States, on

sion of the rights

of

governed." j That principle is
.very
bedrock of American
democracy. That principle coupled
with free enterprise has made the
United States the most successful
political and' economic unit on
earth, Neither our, economic; sys¬
tem nor our government is perfect.
For 170 years the American people
have been endeavoring to improve

political institutions and

economic system.

But

we can

truthfully say today that notwith¬
standing all; the faults ^ of our eco¬
nomic system and our govern¬
ment, the j American, people do
enjoy freedom of conscience, free¬
dom of press, freedom of speech,
the right of free assembly, a fair
administration: of
justice,
the

Roosevelt,

tions

following principles:
countries

"Their

seek'

Other;

■

and the Iran Declaration.

should

not

subscribe

surrender; of

the

principles

We

,

agreed to

were

"They respect the right of all
V
peoples to choose the form of
government under which they
will live;

ed

,

make

now

short

a

of the unrivaled achieve-;
the American
system
of economy and government dur¬
ing the late; war. i Industry was
mobilized, the economic war load
was intelligently distributed, the
war resources of the nation, were
quickly developed, price control
was reasonably effective, inflation

summary

of

ments

to a great degree was

prevented;

which

comrades to die in battles

our

are

needed

for

aware

am

which

as

did not

When

President

miracle

of the

age.

understand

al

:'f before the impact of Our product
; tivity and our fighting men had
registered in full force on the

surrender

government and the unification
the war we con-r

the liberalization of the
government.
China co¬
operated.
to

national

Present Status of Our

Foreign Policy
Truman's

President

12-point

foreign policy formula departs in
some
details from the Atlantic
Charter mid the Iran

Declaration!

convinced that the President
made these modifications to cover

I

am

'

their desire, for the mainte*
of the independent sover¬
eignty and territorial integrity
of Iran.
They count upon the
participation of Iran, together
with all other peace-loving na¬
tions, in the establishment of
international peace, security
and prosperity after the war.

:
■

This will

convince you

the

principles,

the

•

Teheran

make

the

;

concessions to

democ¬

to which they have hereto¬
fore agreed.
'
"
\

racy

v

One of the chief weaknesses in

claimed our foreign policy is the result of
Up confusion, lack of clear directive,

Conference

and

we

lack

of

discipline prevailing

were

-

this American unit of government

-

the heir of all the ages in the foremost files of time.
4

;■
•

oly.
I

•

•
am

aware

that

in

the

- •

With

-let

us

which

these

basic facts in view,

examine the principles for
we

claimed

we were

fight¬

ing in two World Wars.
t

in

Our
the

make
'

announced
first

the

World

world

foreign policy
War

safe for

was

"to

democ-

racy."-That slogan, was elaborated




to

do this

and Italian imperialism, but
imperialism of our allies,
the
Russians,
the
Dutch,
the
French, the British and the Bel¬
gians.
In extenuation of French,

man,

Dutch, .' British and Belgian/im¬
perialism" it has- been said that

monop-

proper

If

un¬

to

propose

we

that

unfortunate

/

We

should
be
opposed to that
policy for the simple reason that

or
or

used

we*

fighting.

were

We departed from our

principles

permit¬
ted the United Nations Charter to
at San Francisco when we

contain

authorizing

provision

a

the power of veto by one nation.
Under that provision any one of

Russig, France, Brit¬
China or. the United States
may nullify the : will of
all the
other people of the world.
That is
riot democracy. That is autocracy.

the Big Five,

ain,

Finally, we appear to be enter¬
ing on a kind'of imperialism our¬
selves,- in violation of our own
principles.

alignments

political

and power
inevitably led to war.

have

blocs

The elimination of these two con¬

cepts

policy indicates
for America

foreign

of

that the.right course
is

to

her

place all of her power and

behind the United
Organization to make it
succeed, make' it wdrk. ? Eventu¬
ally, in the United : Nations, all
nations, great and small, would
have equal rights to choose their
own form of government, to have
a fair administration of interna¬
prestige

Nations

.

tional

justice,

to

their

develop

resources; to raise their owii
standards of living, to be free,
from aggressions, and to have rea¬

own

sonable

assurance

Talks

Indonesian/Clash

on

arrival

The

of peace.

of

Archibald

Sir

Clark Kerr, special envoy of the
British Government, at Batavia;

Java, is regarded p,s an important
s tep
toward solution of the con¬

that flict between Netherlanders and
against Indonesians in the latters' strug-

controlled and closed
wofid, including ourselves,
economy that is in conflict with

all the
an

democracy and free

enterprise. In

doing this we are using America's
economic
strength
to
defeat

economically.

America

poured additional bil¬
otherwise
supporting the decadent sys¬

We have

lions in lend-lease and
into
tems

which

colonialimperialism;

of
is

also

from which

closed economy,

a

we

are

excluded un¬

back into it.
imperialistic monopoly

less we buy our way

Colonial,

is also in conflict

and
we

are

with democracy

enterprise. ■

free

pouring

American

•

Here again

out. billions

of

dollars, America's eco¬

nomic strength, to

economically;

.

American taxpayer

afford to

economic systems?,
»
How long
can
the American
At Yalta, in secret agreement,
which may now be told; America taxpayer afford to support eco¬
surrendered the first principle of nomic systems whose purpose it
,

.

own

our

lead
position
will it not destroy the American
system which I have attempted
to describe for you?
I say to you
that it is the purpose of groups in
the world, who are represented in
America, to destroy the American
system of government and economicsf Do you wish this to be

the

imperialism and

coordination with the
diplomatic foreign policy.; •
1 +-

also the

deficit
not
people

we

to permit others to

or

into

us

out

going statement I seem to be op¬
posing not only Japanese,^ Ger¬

lead

we

debts, disillusionment and

employment?

oly.; Confusion also was caused
during the war by the... hydraheaded economic agencies, several
of which made commitments with¬

.

,

-

eventually

defeat America
We. are now dis¬
cussing ' additional loans to the
imperial nations, which nearly
everyone
admits, will, never be
paid.
How long, I ask you, can

colonial

fore¬

If

give-away-

abroad and
our
spending at home, will

and

is

the

in the State Department.
Some of
fi ghting for the
the elements in the State Depart¬
principles of democracy and free
ment are working at cross pur¬
enterprise all over the world. We
r battle
fronts, v America is strong were
fighting for the rights of poses. Some tend to be sympathe¬
tic toward the objectives of Rus¬
J both, physically
and spiritually.- man.
We were not fighting to
sian imperialism and Communism,
Let us be realistic.; Our produc¬
promote Russian territorial ag¬
while
others
tend
to
be
com¬
tive strength is a force in the
grandizement 6r imperialism or
: world i but
our
principles make colonial imperialism and monop¬ placent. toward
or
to
support

certainly

lavish

our

policy

_

surrendering of her
It is not necessary for
us to surrender, fundamental prin¬
ciples to obtain cooperation. Im-;
periaiism arid; Communism should
and

es

principles,

to

of busi¬

men

closed economy, an economy

fighting were clear,

were

to

fighting.

future economic

own

ask you

tonight this question:

continue

the American munitions

on

giving-away of America's resourc¬

Confer¬
ideals and

objectives for which we
we

ness

position appeared in, our ap¬
Spending
peasement of the very principles,
We
have
poured billions in
against which we claimed to be
and
otherwise into
fighting.- - This is indicated: .by lend-lease
Soviet Russia and her satellities
our tendency in diplomacy to as¬
despite the fact that we know that
sume that the only way to obtain
world cooperation, is by the lavish in doing so we are supporting a

the close of the Teheran
ence

we were

The first weakness* in the Amer¬

gentle¬

of the fact that at least up

said

ican

CHARTER. TO
.WHICH ALL FOUR GOVERN -

•

we

Departures from the Fundamental
Principles of the American
Foreign Policy
-

ATLANTIC

men

remoye
emblems

American

obliterate

light

which

THE
THE

OF

;siiriperiali6ts?/t6

clared

his public statement- of policy a
determination to maintain gener¬
ally the principal -objectives for

IN ACCORDANCE WITH

PRINCIPLES

nial

foreign policy more workable in

in

I

equipment which were being
to/defeat one of the princi¬
ples for which we had all de-j

the

nanqq

our

welfare.

that situation was to tell the colo¬

mitments that were not made by
him.: Parir cdnvinC'ed that Presi¬
dent Truman intends to make our

of the departure; from
principles of: the Atlantic
"The Governments of the United Charter and the j Iran Declaration
States, the U1S.S.R., and the and in light of secret commitment^
United Kingdom are at one Which were made- before; he* be¬
with the Government of Iran came Chief Executive. : I seb in

;

terest in

the

brands

the

"on

great

anxiety for the fiscal condition of:
nations but very little in¬

Organization.

position in which he found
himself" by reason of secret com¬

the

responsibility of writing or
supervising the writing of the
draft of, what became the Iran
Declaration,'; vidiich was adopted
by the Teheran Conference on
Dec. 1, 1943.
That Declaration is
in part as follows:

have

to

seem

,

sistently. labored, and to a great
extent succeeded, in pointing the

The

to

We

.

would not

principles.

way

of

ourselves.

nation

The
colonial people should at least be done?
',
allowed to keep the hope to aspire
Future Foreign Policy y f '
to self-government and eventual
America has three courses op&v
independence.
Instead they have
been left as completely subject to to her internationally.
She may
colonial imperialism and monop- expand and strengthen herself in
an
attempt to .become so power¬
oly as they were when the Atlantic
Charter was promulgated.
Some! ful that she will be safe from at¬
of
these
colonial
This would be wrong. "If:
people have tack.
revolted and are attempting, to set would be construed as an attempt
up for themselves the form of by one nation and one people to
government under
which they control the world. That would be
desire to live, in accordance with in conflict with the fundamental
the
principles of ' the; Atlantic principles
of
democracy.
The
Charter, to which all the nations second course that America might
had subscribed. 1 *.
pursue would be to join a power
In
certain
areas
the
colonial bloc,
a ; political; alignment,
in
which a group of nations includ- v;
powers are using American lendlease equipment for the purpose ing America would be so power¬
of
resubjugating
revolutionists. ful as to defy attack by. one other
All our State Department did in nation or combination of nations.

of China during

ar¬

,

loving people of the world to the
cause for which we were fighting

or

instead

them

control

United Nations

this—while we upheld the nation¬

production achievement" the mar¬
shaling,- training-and equipping of
MENTS HAVE SUBSCRIBED."
5; soldiers, the strategy and tactics of
This is unquestionably a reaf¬
our
military leaders, the intelli¬
gence,
physical stamina arid firmation of the principles of the
The Iran De¬
^ matchless /valor cbf themen "who Atlantic Charter.
was
signed
for
the
won
victory after victory —all claration
these things put together made an United Kingdom by Winston S.
imperishable record of America's Churchill, for Russia by J. V.
military and productive strength. Stalin; and for the United States
The world respects the power of by Franklin D. Roosevelt.
tions under which that power was
developed, But let us realize that
American principles and ideals and
objectives had rallied the freedom-

our

delude

debt-ridden

other

for
should be
which now

powers

not

us

most

earth.

trusteeship

Nations

to the

given

We supported the
establishment of a free, united,
democratic government. Not only

the

Add to our

'the United States and the institu¬

United if;

diplomats who either

In China we did riot
our

|

Roosevelt

including

Let

the

these dependent people

support these, principles.

their

"

In China we
principles
for
fighting and we

everyone,

career

own

to the validity

of the Atlantic Charter.

were

we

fought

that some question

has been raised

the

understood

economic prosperity."
I

leadership, of man¬

agement,. free labor, free enter¬
prise, healthy competition, com¬
bined to evolve the •- production

by both Britaiq

This is the point.

"They , will endeavor, with due
respect for their existing obX
ligations, to further the en¬
joyment by-all States, great or
small, victor or vanquished,
of
ACCESS,
ON
EQUAL
TERMS, to the trade and to
the raw materials of the world

unprecedented scientific achieved
ments were [attained,, mechanical
development, surpassed, all past
records. All Sthese items, together
with the loyalty and efficiency of
the' war workers/ the unfaltering?
clear-headed

that

all over the world.

other nation. At times it ap¬ from the objectives and principles
pears to us that our system of recited in the Atlantic Charter;
government is not working well.
I suggested that the Teheran
We should remember, * however,
Conference,
at; which
Marshal
that human nature itself is not
Stalin would be present,; should
perfect
and,
therefore, human
adopt a new declaration. Presi¬
beings do not create perfect in¬ dent Roosevelt
charged me with
us

a

and Russia and for Which we ask¬

any

Let

to

•

greatest
school system in the rived in Cairo for the Cairo Con¬
world, the right of collective bar¬ ference before going to Teheran;
gaining by organized labor and I suggested
to
him
that the
the highest standard of living, en¬ speeches made by our distinguished
joyed by any people anywhere. friend
Winston
Churchill
and
Even so, we do have a more equity others in America seemed to in¬
able distribution of wealth than dicate that we were
departing

stitutions.

Britain

their,

modernize

and

America is at the present moment

Sig

the rights
of all people to choose the form of
government under which they will*
live."; y.:- •'I,■-}■ .''
We all recognize that some of
the more than a billion people
now ; controlled
by'colonial im¬
perialism from the West Coast of
Africa, through Egypt, the Middle
East, India, Burma, Indo-China,
the Malay States and Dutch In¬
donesia are not in a position and
perhaps many of them do not
have the qualifications to choose,
at this time, the form of govern¬
ment under which they will live,
But this is no reason why the

question was answered con¬
clusively in the Atlantic Charter

or

the

con¬

support?

in violation
by

are

American taxpayer for

Four that "they respect

that

ag¬

no

powers,
commitment

the

of

of other nations
other people?
With the ap¬

proval of both Russia and

;;

grandisement, i; territorial

is

and

14, 1941, pledged both na¬
among otner xnings to the

Aug'.

the

our

fighting.

President

Declaration

That

colonial

the

tions, the desires or the necessities
of one nation justify the transgres¬

the

our

yet established

colonials

instead of relying on the
continuous

economy

our

trusteeships for dependent people,
not by the United Nations but by

impoverished.

oly they would be

the

as

renovate

principles was at
San Francisco when we agreed to
of

render

imperialism and monop¬

colonial

both wars

were

Independence our forefathers
pledged this nation to the^ support
of
governments "deriving their
just powers from the consent of

both

won

empires are

probably correct. Never¬
theless, it does raise the question
thathasplagued mankind through¬
out the centuries: Do the ambi¬

few fundamentals.

American

We

have not

we

we

America's Foreign Policy
state

in

cerned, would we not be justified
in asking our friends to reform,

grandizement, territorial or other."
The second indication of sur¬

comparatively
poor and. in some instances overpopulated at home and without

these

a

"principles for; which we said

'

us

by

the

we

Service is weak.

/■ j Let

War

the Atlantic Charter and the Iran

Declaration.

we

World

second

definite statement of principles

fought it will.be be¬
cause we are strong in war but
weak in conference. Our Foreign

.

the

: for

,

So

Three nations would seek "no ag¬

the Atlantic Charter and the*

Iran

support failing

is to defeat

America economically?

:

gle for, independence; On Feb. 3,
Sir Archibald, who is to be Brit¬
ain's

ambassador

new

United

ately

,

States*

separ-,

Premier.

Indonesian

with

Sutan; Sjahrir and Dr.

the

to

conferred

Hubertus

j,

/

Mook, acting Governor Gen¬

van

eral

in

ences

Indies..

Netherlands

the

Although

details

of

the

confer¬

not disclosed,

it was-

that they served

to ac¬

were

assumed

quaint Britain's envoy with both
sides of the difficulty
to

forthcoming

the

preliminary
peace

and

between Netherlands officials
leaders

*

of

dohesian

y

unrecognized 'In-''-'

the

Republic,

Associated

according fa
advices

.Press

from

Batavia.

fighting continued

Meanwhile,
between,

the

Netherlands

Indonesians

and

British

.

avid

troops,

with the rebellious forces reported
to

be

-

striking

severe

several -sectorsA«*

*•

*

talks

blows

in.

<

PHYSICAL VOLUME

The Outlook lor

and Prices

Production

ADJUSTED

OF

FOR

INDUSTRIAL PRODUCTION

SEASONAL VARIATION

(Continued from page 834)

agencies suggest that money sper^
plants and equipment of all
kinds during the four war years

ably three to four million workers
still remain in wrong places inso¬

for

far

INDEX

neighbor-

opportunities for peacetime
production are concerned. Return¬

hood of $37 billion, or an average

ing to the farm, particularly if it

of about

is in the dust belt

.'reached

total

a

the

in

as

300r

"

•

'we
of

$9 billion

year.;

a

the

in

interested

are

volume

physical assets
'rather than in money spent, ad¬
justment has to be made for the
of

expansion

in

rise

construction

perhaps $7 billion.
we
all know,
plant and equipment
produced during the war is not
serviceable in peacetime.
Not all

properly located for
\advantageous peacetime produc¬

tion.

are

Relative size is

tin other

drawback

a

Furthermore all of

cases.

physical equipment

our

ejected to
in

normal

more

wear

period

war

"

than

sub-

was

destructive

more

| and tear during the

times.

All

factors

considered, it may be that
net annual increase in plant

our

and

Ozarks,

few years

a

high

wartime

wages.
v

/Another important

development

rapid increase in union member¬
ship.
At the end of the First

much of the

plants

life

average

as

.

urban

relative to personnel has been the

of $9 billion to

Furthermore,

.

of

This

costs.

reduce the annual

would

in the

or

is not attractive after

World

War,

there

million

members

in

country.

this

1939,

time, there

lion

who

cards.

At the pres¬

about 15 mil¬

are

members

forces

of

our

significant.

working

labor

.carry

This

3

unions

By the end of
had been in¬

membership

creased to 7 millions.
ent

about

were

of labor

union

wartime

growth is
Major industries are

almost completely unionized

now

and nearly one-half of the present
union members have experienced

such membership only during the
during the war period of wartime abnormalities,
years was about $6 billion.
This labor: shortages, increasing
wage
;is a rate only slightly .below that rates
and
emergency
overtime
of 1939 but considerably
below pay,
v
\
the peak years of 1929 and 1937*
There is also the question of
Based on these assumptions, our
efficiency of the working force,
usable plant and equipment has
that is, whether or not the war
expanded appreciably during the has
increased the productivity Of
war, but the rate of expansion has all
of us or
and

■

-equipment

*

whether

i not been
the

rapid than during
normal peacetime years.
more

more

Personnel

■£

for the period

the personnel—the manpower—of
the country.
This includes labor¬
ers,

farmers,

managers,

all

; women,
.

immediately ahead,
changes in

notice wartime

us

of

gain*
It would be well

fully employed.
if

who

us

and

men
are

could ask

we

ourselves, in terms
; Of the popular slang, "How are we
doing?"
Are there more of us?
Are

we

more

ready to work?

Do

; we have greater skill? * Are
efficient than

more

fore

the

we

were

and how well

war,

we

be¬
can

; our capacities be utilized?
In the first

place, with respect
,'to numbers, there
were, at the
wartime *peak of
activity, about
65 millions of us
gainfully active
;in production land in the armed
■

services.

At

millions
:

that

were

"time,; about 0

temporary

workers who, for patriotic
or

otherwise, left school

of

retirement

/Also,
were

this

services.
.-caused

places
jobs.

period

there

women

furthermore,

12

some

'and

men

peak
'

.war

or

em¬

there

millions, including

women, i in the armed
The end of the war has

i <H disappearance
.from the working force of
many
a

r a

p

in These three
groups.

Most of the
-workers
have - gone
back to school or back
to

"patriotic"

places

of retirement.

Many women have
their households and
many of those released from the
returned

•

*

in

made.

are

not

remaining

the

actual

on

indicate
below

that

/the

United

sion.

the

;

efficiency

in

'28

-291930

*31

*32

*33

*341935 '36

'37

'30

'391940

'41

'43

'42

'441945 '46

'47

'48

'491950

SOURCE.

FEDERAL RESERVE BOARD

WHOLESALE

is

now

.The

of

this

PRICES

data

level.

Bureau

concurs

'27

findings

production

prewar

States

Statistics

ALL COMMODITIES

Labor

YEARLY AVERAGE

*

conclu¬

It is true that productivity
did improve from

per

man-hour

the

time

goods

the

production

started

was

in

until the end of the
true

that

of

war.

war

INDEX

Tt is also

reconversion

once

INDEX

plants

our

f

to

f.

peacetime production is completed
assembly lines are again mov¬
ing, we shall have the oppor¬

1 •'

the

77.;'
4

-

I

.

1

■

force

is

war

but

I

term,

might/call

we

nomic morale."

v

AW* 1

important.

our

;

son

was

In

sary

that it will be cut to a total
in the
low 50's before it resumes
its nor¬
mal upward trend.

.;.b

AtfS:

tM:

I

[

1

Ay:

I'

\

.y,
'

•J r -tT

'

'

■;vv-

<

■

;

I

£

•

-■

1 f

\i

IT

VU-":f *Jr-

.

V

J

1

£

1

f

1

A::

■f-K-Ji;

\

'

i-

:

")•< u-i

yA>-

1

1

H/ V
•

■

.

'

'

"

>

.V

y

Ali-\ ■->! J
J

y
•'

'

...

V.

'•V'"

:

.

till

••V T-*

•

...

'

■:M. :'-:'4yAy.
:
•

,

neces¬

Y

";.y ■
:

for the Government to

I'U

i i-

iVi

"finding

it seemed

Ai

i * v-4
*

degree, the same may
of many of us.
During the

emergency,

vA

t

1

.

Ilf

..y-

I

*

■

some

be true
war

I

'*??•'

■

■

«-l
1.

"eco¬

little hard to settle down."

•

.

|

''

1

a

better

a

-•$

'

f

with overtime work,
paid as high
as $90 a week. After this
job came
to an end, his father remarked
a

'

'IX-.--

A rather extreme

his

.1

1
V:

may
make
the
point
neighbor of mine has a
son who left
high school in 1943
to take a job in an
airplane fac¬
tory. After a few weeks of train¬
ing, he was placed on a job which,

it

1

'

..

A

that

>'•

•

example

me

L

J.

1

'*•

clear.

*

i' -V*
L'-'Vs,'-7v"

1

our

has been costly to us in

•

.V V

1

tangible than

very

-V'.*.

Ar>>':v

S

t

.

which, -for lack of

way,

to

;•*
''

i'".7'

less

'

'

■

■

to

"i'-ik

'l

;

V-

1

others,

The

.'

7,r7v7fi.'

t

Another point relative
labor

ISA:

4

Av Ay

1

time will be required to re¬

gain lost ground,

j.y-y,..,,;.

1

tunity of advancing the rate * of
output per man-hour.
However,
some

1B0

I.

and

working force, but rather
taking advantage of educa¬
tional opportunities.
Thus, the 65
million wartime
working force is
being rapidly reduced. It appears

•

j ;

.

.

.

>

A" vi&\ c

/

.

y\ ;y {;;

■

'

.

sary

are

■

Generally,

based

'26

.' Accurate

this capacity is,
many cases, impossible; how*
ever, for those producing mate¬
rial goods, fair estimates can be

to

armed services

1923 '24 1925

fit less

we

j obs.

pur
measurement of

reasons

wartime

15 million

some

ployed' and,
were

for

into

in
,

In the second place, as we consider our economic potentialities
let

:

-'

•

well

%
> In the second place,
many who
are still in the
working force are
finding themselves poorly located
for peacetime

employment oppor¬
As you know, the
migra¬

tunities.
tion

of

/States
War

population

during the
was

movement

the

in

in

the

United

Second

World

largest

the

internal

history

of

the

eountry.
This migration was of
three kinds—from the
interior of
the country to the
perimeter, from
the farm area to
industrial
areas

and

from the South to the North

and West.

brought

The end of the

some

reversal

war

of

has

these

population movements; but
prob¬




subsidies

to

various

■

pay

'

"4,

producers.

llnlmi 1111I1111

These producers are now
finding
it hard to give up the
subsidies.

null 11,1,1 nil

in

.1

ilk,Li,iii. itiitiiu in 1I1 ul

11

li

Iii

11

1

in

1

m.i 1 .11

ill

1,1 U, i

i.i

LLuj.1

-.IxJ

111

lllllllll Ill'lilJI 1;

LI

III

till

II

iiuli.ui

11

ill

1,1,1.1

During the

war, it seemed neces¬
to support many prices—
agricultural prices
and
various

commodity prices.
Again, these
producers are finding it -difficult
to

adjust

same

to

free

situation

to some of

us

iharkets.

comes

in the

-The

Source

all of

To

close home

banking fieldi

United Stotes Deportment of Lobon'

indicate that it is
us

is

numbers

the war,
certain
loans
guaranteed by the Govern¬
ment and some lenders have be¬
come

accustomed

Again, those of
wages have
difficulties. '

population
tomed

to

to

us

this support.
for

who work

encountered

of

has

group
become

extraordinary

for labor, choices of two

our

accus¬

demand
or

more

jobs, unprecedented wage rates,
steadily advancing wage rates and
also improved real incomes.

De¬

velopments of the past six months

for

gainful

moderately
than

it

was

production
strongerMn
before

and^wartime

war,

have reduced

duce.

similar

This

only

y?;;.

up, our manpower now

available

During

"

little hard for

to "settle down."

sum

were

a

our

changes
capacity to

the
may

pro¬

Methods and Technique
one

nomic

outlook

happy

one

This

relates

at
to

phase of
which
the

is

our
a

present

eco¬

very

time.

and

the

like,

years.
At the same time, it is my
feeling that this increase will not

extraordinary. ;If I were go¬
to attempt , to suggest the
range within which the physical

tion of farm

volume

production advanced
extraordinary rate during
the past five years.
On the farm,
at

we

•

There is

mechanization,

which put *us in a much better
position to-produce goods in the
future. This is true of agriculture
as well as industry.
Mechaniza¬

ran

have learned how to increase

production,, even while available
manpower was being reduced.
In combination, it seems to me
that if

we

take all of these factors

that is, our plant and
equipment, our available man*
power and our methods1 of pro¬
duction, we can expect a moder¬
together,

technique and to
methods of production.
During
the war, we saw
many technical
developments, many short-cuts in ate increase in the output of goods
production, many increases in I by our economy over the prewar

be

ing

of

production would
ifuture, I would
prolong a line of "trend which fits
fairly accurately the: Board's in¬
dex during the 20 years preceding
fall

:

the

war.

the

in

our

near

Such

a

line would give

the Board's index
for 1"946 at about 160. Then, if we
us

a

point

take 20

on

points in either direction

from

this figure, that is, 140-180,
it would seem,to me that this area

might

represent

range

of

our

the most likely
of production

rate

during the next 12 to 18 months.

Volume

163

THE COMMERCIAL & FINANCIAL

Number 4464

CHRONICLE

1

INVESTMENTS IN

BY THE COMMERCIAL

BANKING

SYSTEM

Funds Being Used

is obvi¬
accumulated assets are
being used by the public. Despite
the fact that industrial production
the war. As you know, there were
is far below that of a year ago
heavy
Government
borrowings
and incomes are lower, retail sales
from commercial banks.
I pre¬
have continued to expand.
The
As

BILLIONS OF DOLLARS

it is clear to you how

sume

matter of fact, it

a

that

ous

posits which occurred as a result
of the method used in financing

;

i

this rise in

notice how

us

ability to pay came about.
The
major part of the rise was the in¬
crease
in commercial bank de¬

0ILUONS OF DOLLARS
iggi

Let

this

example, present rate of industrial output
is appreciably below that just pre¬
when you borrow from your bank,
ceding the attack on Pearl Harbor,
you
give your banker a note
For

worked.

process

above those
turnover of

deposit of similar amount for
by agreeing to pay you that
amount on demand.
Thus, a new

up a

FEDERAL /

RESERVE

bank

commercial
into

^

BANKS

deposit

when

existence

from your bank.

you

comes

borrow

banks and

Commodity

its bonds

commercial

present rate of business

the
activity.

the

question

despite

tinues

amount, come into being.
The extent of Government bor¬

adversities in

.

You will notice the

such

of

tent

First

World

War

—

an

asked,

which, at the time, seemed large.
total for Federal Reserve

liquid assets in the hands of
public, which resulted from
war financing. It is true that there
are

of

other

upward

pressures

on

prices, such as shortages of vari¬
expendi¬
ous
goods, particularly textiles, ■
tures during the decade of the
housing and housefurnishings, and
30'S, the total increased to some¬
the advance in costs of produc¬
thing like $20 billion.
Wartime
tion,
Nevertheless,'- the
major
expenditures caused a great ac¬
celeration in the rate of advance, cause, and one which gives evi¬
dence of remaining with us for
so that at the end of 1945, it was
some
time, is the expansion of
about $115 billion.
liquid funds. ,
Largely as a result of the ad¬
;
Much lip seryice is being given
vance in Government borrowing
to the prevention of inflation. We
from the commercial

financing. Government

COMMERCIAL

BANKS/: 5'

banking sys¬
tem, we have the increase in
liquid assets in the hands of the
public, shown on. Chart IV. This

if Gonntri of flit PtOrtil tfttirh SjrUm

Stwtr

un¬

the

somewhere in the neighborhood of
process

is already

way

of

banks and commercial banks was

During the

inflation

to,

and that the main cause
is to be found in the expansion

der

The

$5 billion.

\

going to have in¬

In reality, it appears

that

me

the

amount

hears
we

are

flation?

ex¬

in

borrowing

still

/One

rowing ; from commercial banks
during the war is indicated on
Chart III.

The

prices of common stocks, as you
know, have advanced some 25%
since the end of the war, and the
boom in real estate values con¬

deposits, in similar

new

real

history.

our

ception to the general rule.

Similarly, when

become the assets of

some

are

of that period.

prices, insofar as the average is
concerned, show steady advances.
Gasoline is the outstanding ex¬

the Federal Government borrows
from commercial banks,

in

est

you

70%
The
estate is the high¬

sales

retail

but

promising to pay at some time in
the future. In turn, the bank sets

'

later to

temporary use for funds
be used in other ways.

/'Ability to Pay"

_

U.S. GOVERNMENT SECURITIES

LIQUID ASSETS IN THE HANDS OF THE PUBLIC

chart

shows

banks,

hear
"hold-the-line"
speeches and "pep' talks" on the
desirability ci-of '; everyone
being
temperate in his purchases, but if
we
really want to deal with the
underlying cause of the advance
in
prices, we must direct our
energies toward the great volume

frequently

currency
outside
deposits-—time and

,

bank

demand, less Government and in¬
ter-bank

deposits

—

and

redeem¬

able Government securities in the

hands of the

public.

This would

of accumulated funds.

The total of
^involve the reduction of swollen
$65 billicm
bank deposits — in other words,

these assets was about
BILLIONS OF DOLLARS

BILLIONS OF DOLLARS

—

■

2S0.

1

,.250

in 1937r

mately
isted at

■

ThiS
equal

total approxi¬

was a

that Which

to

establishment

'the

ex¬

time of the boom

the

of

a

definite

policy to get the debt put of the
banks into the hands of those with

of

1929, At the time of Peart Harbor*

available funds.'. Under present;;
totaled some¬
circumstances, the tendency is for
thing like $85 billions, and it ex¬
bank deposits to continue to in¬
panded to about $235 billions at
crease as more bonds are absorbed
■

these liquid assets

.

the end of 1945.

Notice that the

Furthermore, if it is
actually to reduce in¬
purchasing power. in > the
A major question at the present
hands of the public, one way to/
time is the extent to which these: do it would be to increase taxes/

REDEEMABLE

by banks.

increase from 1937 to the end of.

GOVERNMENT

1945 is almost 400%.

SECURITIES *

our

desire

flated

.

funds

in

now

hands

the

the

of

public will be used.
Much has
been said of late regarding "liq¬

uidity preference," that is, the de¬
sire of the public to maintain

paying off greater proportions of
the public debt.
However, the /
current
feeling
is
that
taxes
should be systematically reduced. •

Summary
large cash reserves. The very fact
that these funds do exist in some¬
Regarding the outlook for in¬
body's hands at the present time dustrial production,
it appears
suggests to some observers that that in view, of all of the' factors ;/
large unused holdings will persist involved, We do hot have "what
in the future.
It is true that the it takes" to; maintain a level of
turnover of commercial bank de¬ industrial
production comparable
>

,

DEPOSITS

posits has

shown

a

general down¬
the

ward trend since 1929, when
rate

was

more

than 50

times

a

with

that' of

peak.-

wartime

the

Rather, it seems to me we will
have to be satisfied, during the

At the present time the
period immediately ahead of us/
17 times a year.
with a level, as measured by the
A rise in the turnover of liquid

year.

turnover is about

assets,

us

CURRENCY

a

to the

even

lying largely within the range
140 and 180.

spectacular spending boom.

and

indi¬
"liquidity prefer¬ above

sets have for the most part

the

if Gortnwi Of the Foxtrot FestrrO SfrtftA oM United States Treasury,

estimate is reasonably ac¬
curate, then we would expect a
If this

moderate increase in the supply of

goods,

generally,

prewar

over

/

years.

Prices
*'

The

trend

of

wholesale

com¬

modity prices in this country since
the establishment of the' Consti-

/ tution
You
/

is

will

indicated
notice

in

that

Chart II.
very

high

jprices are characteristic of war¬
time.

However,

the advance in

\ prices during the, Second World
•

War

was

not comparable to




that

basis.

of earlier wartime

question
we

yet

periods.

The rect, the supply of goods for the

before us now is,- Will
have a substantial price

future

immediate
be

much

above

is not going to
that

of

prewar

rise?

years.

Thus, demand is the key

attempting to answer this
question, let us take the broadest

factor,

and

In

possible
Price

•

view; of

:

the

situation.

(and here
markets/are to

movements

assume

that

we

be

relatively free) are dependent on
a
kind of teeter board, on one
end

of

goods
other

which

and

is

the

services

supply of
and---on the

end, the demand for these

products. If

our

estimates

are cor¬

the uncertain factor,
at the present time. You will re¬
member that demand is defined in
the old economics textbook which
you

used in school

ability to pay."

ability to
is

one

pay

of

as

"desire plus

It is the rise in

which, in my mind,

the

most

important

changes which Our economy has

experienced during the war.

A

typical farmer has in

mind the addition of rooms

house* the construction
barn,

fences,

new

of a new

and the like.

Many m Government/.■ bonds
been sold oil the

until

the new

is available,

or

to his

have

slogan of saving

electric appliance

saving for a down-

payment on a new home,

etc. Simr:

of directors of
corporationsmay be

ilarly, the boards
industrial
considering

Government

their

| holdings

securities

only

of
as

me

services
prewar

.

ence" idea stands on a pretty slim
Source: BmtH

of

Regarding prices, it
that

since

we

are

likely to have a volume of goods

relative to their use of liquid as¬

that

to

seems

Surveys of the intention of people

cated

index,5

Board

Reserve

Federal

average rate

ten years, would give

of the past

moderately

only

.

levels during the

months immediately ahead, while,
at the same time, we

have poten¬

buying power approximately
four times
the prewar amount,
tial

rising prices are

logical*

//

Should

for an estimate of
extent/of - such rise during

you press me
the

mention
10% for congoods generally. This, of
is not what I desire, but
trend which, because of

1046, I should probably
the

figure of around

sumers'
course,

it- is

a

present circumstances, I am
to expect.

* •^

forced

.

864

dv^:: :■

v.'.;

.

THE COMMERCIAL & FINANCIAL
.tm
CHRONICLE

Bureaucratic Investment Control
(Continued from first page)
our
own,
the
British .measure,
When considered along with otner

proposed
has

socialistic

legislation,
significance.
It

special

a

makes

Government and ,Business
in Britain one, in fact, and may
mean

eventually the end of pri¬
"enterprise and a free econ¬
omy in the foremost capitalistic

changed.
The old Anglo-Saxon
concept of harmony of private
and
public interests
has been
overturned to its very foundation
stones.

i:"r

.1

.

.

vate

to control, new capital issues that
since 1939 have been exercised by

nation of the last three .centuries,

the

,The

-

traditional

mercial

policy

British

the

since

Adam Smith has been

interference
tive

in

with

com¬

of

days
of

one

lations

t

,

non¬

private

initia¬

the flow

directing

of in¬

vestment capital and in promoting
the
expansion
of industry and

The

policy of stimu¬
lating public welfare by permit¬
ting each individual to seek the
commerce.

betterment of his

terests

of

stone

regarded

was

British

private in¬

own

as

a

corner¬

politics. Accord¬

ingly, the British Governnmnent
the

since

.hot

the

Acts"

"Bubble

of

18th Century, never
■sought to control the operations
of the Stock Exchange and* ex¬
cept ill rare instances of emerg¬
ency, never interfered with the
credit policies
of the Bank of
England or of other credit instil
tutions. This policy was in almost
complete contrast with that of the
early

French and other continental gov¬
ernments,
'

•

to

of which sought
own
political and

each

effect

its

economic

interests by placing se¬

of control

vere measures

£nd

vestment

ities.

I

The

in¬

activ¬

.

British

>

over

speculation

Government's

"hands-off"

policies gave rise to
vast investment banking activities
throughout the British Empire,
and may be said to have been re¬
sponsible for the nation's finan¬
cial

commercial

and

The

,

greatness.

investment

British

individually and

group,

a

as

bankers,
as¬

sumed

the responsibility
of di¬
recting the flow of capital. Thes^
men,' without bureaucratic plan¬
ning
and
without
Government

subsidies
and

built

enlarged
moted

privileges,

or

the

British

railroads,
shipping, pro¬

British
British

.

planned

industries,;

and

built up credit and insurance in¬
stitutions superior and more com¬

prehensive
quarter

than'

in

any
other
globe. Under the

the

of

j

system of private initiative, the
English became the world's dominat capitalists and were the envy
of the other great commercial na¬

tions. The great British Common¬
wealth of Nations may be said to

be the'

creatiqn of this policy of
/laissez-faire.- •-;;
i AiA/aA#;
The U.

S.

Policy

*

We, in the United States, have
followed; the traditional British
policy. It might, indeed, have been
from necessity, rather than choice
that

transportation,
and

surance

other

banking,
public

in¬

service

enterprises, were generally left to
private rather than to state en¬

terprise. But, it
down

as

certainly laid
principle in

was

matter of

a

early American constitutions that
governments
to

not

were

expected

directly ;, in business
undertakings, even when the eco¬
engage

nomic

welfare

of the

community

was-involved, unless private in¬
terests

could

voluntarily

not

would

or

in

engage

not

them.

In

/

the

period when the states, to
further their industrial and agri¬
cultural aggrandizement, attempt-

,e

>.ed to provide banking, transporta¬
tion and.other public

projects,

with

•either failed

or

utilities, the
exceptions,
given up as

few
were

inconsistent with American ideals
of

government.

The

Jeffersonian

principle of the "less of
ment,

the

seemed

to

of

most

better

prevail

the

period

govern¬

governed"

throughout
of

our

rapid

^national development.

But,

governmental

now,

ciples and ideals

•

'*

seemed
'*

"J
'

;

*

The Change of Policy '

\ •

\

'

-T'

V
*'

• ,'":'A'

"
-

••

to

prin¬
have

made
a

permanent: It

is

White Paper pub¬

continue

mittee

to

com¬

all

on'

pass

projects involving the raising of
capital exceeding
£50,000

new

whether by public issues

of

secur¬

ities

or otherwise.
/"; ■
The White Paper accompanying
the Bill also proposes a National

Investment
Council,
under
the
chairmanship of the Chancellor of
the Exchequer, with members in¬
cluding the governor of the Bank

England

and

chairman of

the

the Stock Exchange, to advise the
Chancellor on the broad lines of

investment

policies

fol¬

be

to

lowed by the Capital
mittee.

Issues Com¬

Though the proposed British
legislation is. much more compre¬
hensive than any similar action in
United

the

London correspondents are em¬
the fact, that the new

British

participation

leaders

ness

is bound to

measure

into active

in

the

bring
busi¬

new

British

States

other

or

•

Gov¬

tion, despite the fact that it
add

additional burden

an

may

on

; the

already

drained
and
depleted
Treasury.
Undoubtedly, the Labor Party
aims to encourage the investment
of capital in approved industries
in accordance with its own poli¬
British

the• powerful
Exchequer. If

economist,

r

Chancellor

of

the

this object cannot be

attained, the

final resort will be nationalization

also,

will be used

measure

ply of

ex¬

to

tensively-to

aid
in
expanding
exports, and thereby] re¬

British

lieve the nation of its adverse in¬

should be borne in mind that even
business men, when government

eaucrats.

; i

perience in

our

The

tials;

ex¬

is not difficult to

reason

government.

own

see.

ownership to
the nation's

a

condition. It is an
accompaniment of the strict rule
of law.

In

addition

the

to

control

of

capital issues, which „was orig¬
inally introduced as an .essential
war-measure,
and
is
"already
practically watertight," . the < new
bill proposes to set up a National
Investment Council which, "in ac¬
cordance with the public inter¬
est," will grant Government guar¬
antees to investment
of capital
along certain lines and in certain
ventures.This
Council,
to
be
headed by the Chancellor of the
Exchequer,
will
make
recom¬
mendations, which in the nature
of the'situation,, will automatically
be carried out by the. Treasury. A
Voting
subsidies A and.. giving
other forms of public aid to pri¬
vate business enterprises is not
without precedent. Shipping sub¬
sidies, export and import tariffs,
and the like, have been in exis¬
in

tence

Great Britain

where for
had

and

else¬

long tirne; We havo

a

similiar ventures

in

our

own.

country. In the early days of the

republic,

not

confounded

be

aid

ment

with

to

pro¬

mote rather to control

private en¬
terprise. Such activities of gov¬ figures.
ernment; are

condemned

not

and

in

A

»

-,

British

legislation - is
new and radical
only on the con¬
cept that it becomes a fixed and
permanent political policy and not
merely a temporary or emerg¬

expedient. It places govern¬
as

private

a

controlling partner in

business.

It

thus

brings

about bureaucratic control of
cap-

that

Germany,

Austria,

gar,y,
Russia and
American countries.

of

Hun-*
South

most
f

-

actions

Such

of

«fon Tffket racketeers.,

(//oh,,,./
flatlon Dotenfials' Can

and

outright grants of power and
privileges. There could be no ob¬

jections, therefore,

by Conserva¬
Laborites; or by

British

Board

of

dustry to the development of Cer¬
tain geograpicai -areas 'br in the
direction ~ of' more 'efficient; and

economical

Methods of operations.

modern/ governments
for
this
purpose.

;

have

bureaus

president

Ex-

Hoover was severely
by the Democrats be¬

criticized

^vn^
Lnniltri+fv afra??
thp

of

^

the

the

of

ex¬

to
the
taxpayers.
Yet,
never before in the history of this
department has so" much been
pense

done

planned, and

or

much

so

ex¬

pended in public funds as at the
present time under the present

Secretary, Henry A. Wallace,

.,

.

Dangers of Political Controls
Government aid of this nature
should
to

it.

and

have
It

no

strings attached
supposed to promote

is

encourage, not
control. Private

and

unhampered
given full
economic

and

regulate

back

of

ascendant

are

is

competition is
As long as the

play.

motives

activities

to

initiative

these

over

po¬

litical

motives, business will prog¬
along ; natural1 profitable
channels, and economic laws will
ress

be permitted

to'operate

But when

Government

ters '/business \ as

the

unham¬

death

a

/

en¬

controlling

knell

of

private

enterprise.

A There can be little doubt that
the present efforts of the British
Government to control the flow
of investment capital

end,

be

dominated

rather ■; than

will, in the
by political

economic

Though the welfare of
is

supreme

law,

motives.

bureaucrats

in

have not the unfailing fac¬
ulty for ascertaining what consti¬

tutes

The

the road

motives

to

of

public welfare,.

economic

adding to the

are

inflation with

ing and

more

more

deficit finaric-

government

ing.

A

y

history of

y

no

i ri a-l4 «i

hold the line.

by

This game has

governments

I, Some of our

competitors in the

mone^, credit | international; economic field

have

and finances! condemns inflation,
j teen- more successful in holding
has
Every country in the world has',
*
down costs and restraining inflasuffered from this; diseaSe^^^
...

.

countries which have fought infla-

tion j than

tries
harmonied

likely

interests,,

to sift out and

are

more

implement

conditions promoting general
welfare than a small group of pol¬
the

iticians, banded together as pol¬
icy-making overlords for all the
people. The system of private en¬

terprise, with voluntary applica¬
tion

of

capital use by
is less likely as

owners,

to

afoul

run

and

of

capitala

actions

erroneous

than

and

...

have.

we

.

These

coun¬

Canada, England, Sweden

are

(Switzerland. At present these

countries

following

are

servative policy.

ing -restrained and the
inflation

removed

possible.

In

a

con¬

Inflation is be¬

my

causes

rapidly

as

of
as

these

opinion

countries will win in the effort to

stability and

restore economic

whole

decisions

wrong

re¬

gain their position in world trade.

an

Will

in

we

the

United

States

economic

dictator, acting under
the highest ideals of human mo¬
tives. At least, the gravity of er¬
action

roneous

its

effects,

tend

less

severe

inflate ourselves out of the World's

markets?

in

done to

differences of
multitude
the weight of

since

diminish
nation

No

afford

can

Unless

remove

something

the

causes

flation, the outlook is not

among a large

to

error.

is

the / boom,

after

one

place its 1 material
in the trust of princes,
ministers,
presidents
or
other potentates.
No Government
bureaucrat, no government organ¬

a

s

is

of in¬

happy

burst

speculative honeymoon

to

and

are over.

permanently
welfare

.

Stover & Perkins

prime

ization,

.

benevolent and

however

have

the

L.

in,the long run,
efficiency, foresight or

the firm
do

a

ment

action, in placing funds or in

Stover

and

of Stover

A

Herbert

& Perkins,

general business in
securities a -The

maintain

risking property for the purpose
of

Gilbert

A'

r

L. Perkins announce formation of

intelligence
of in.the
collective
mind, operating ? through individ¬
ual

V'k'.V

Form New Inv. Firm

fair minded, can,

offices "at

New York.

42

-vv.

to

invest¬

firm

will

Broadway,
;/s';A^A!*,Zi!*v--'

insuring permanent prosperity

and

providing for the good of all.

Only, in this

Euler & Co. Admits

does society get

way

dividuals with diverse

against wrong judgments; / A./

as.

or

nn

:«-.!•

—the

well

^

>

patipnal Race of Prosperity?

The

drastic operation is performed,
vrcv»

thropghouta history and not one
has ever succeeded. A!:\::
}-

ihe^nter-

Will Win iri

>

spend-/been tried

action,
under free competitive
conditions,
participated in by numerous in¬
as

will
but
this

trary we

the public

power

money and bank dei

one, should be misled by anpresent. n°oncements to roll back prices

Com¬

Department at heavy

merce

our

and credit supply

money

surplus

mii5n+

doing Do tiling a to pre v6nt
further/inflation.
On the con-

Who

work

present

W-C i.9r6,,

'

Commerce' arid '* asf President;5 j ex¬

mand, and in removing from

WifPosits. This can be done. It
Wp
Z require a drastic operation,
flation RnT ^ Will be' WOrth it. Unless

nr^

nanHino

Frv

Prices regulate supply and de-

sta-

we

Certainly no
i!n ninn iv"

rSfiJi

The remedy is to

be found in free markets where

rw+of«ixr

bilize^an inflation .

musej'he,;Abbtfr^
pand ed

found^n fiehttoe ndce

be

government

have resulted in tariffs, subsidies

initative and

Legislation V

Italy,

money

below

L

though not
episodes in the nation's political
and economic development.

A.•

proportion tb the devaluation and
inflation. These countries included

SdJ^^"rSen?inflnSMS

sound

new

far

currencies, investors lost in

tJ.

much of which forms

:•

is

countries which devaluated

their

1929. .H the present rising
prices, The present inflation in the
quarters or among
any large economic groups, par¬
A
?na
United States may prove to be far
ticularly when special privileges, jects oi black maiket allure, excostlv than the war
The
not
in accordance with public cites the public to spend their
money until the velocity reaches
welfare, are avoided.
not to

partner, political motives tend to
predominate. Such statism will

The

other

of the

political

any

aid was also plentifully given for
canal, road and railroad building,;

A/1V A

500%

some

The velocity of

credit

tions.

'

of

In France the

of

government bonds lost
80% of his purchasing power.
In

in bank deposits. These are round

promotions regarded as as¬
sisting public welfare. Financial

i

buyer

in circulation since 1929,
increase of perhaps 300%

money
and an

govern¬

assistance

and

increase

an

other

Radical Aspect of British

and the consumer.

/This inflation is in the form of

—

pered; by: bureaucratic/ restric¬ opinions

interesting,
altogether pleasing

de-

or

during the

twenties.

We Have Inflation

Congress voted subsid¬
ies and gifts for silk-worm cul¬
ture, vine and olive planting, and

,

value their currencies

a

But bureaucratic control should

All

industry.

fared best in the countries which

in from the sale of the bonds.

Bureaucracy is not

the

not more than 20 % of

poten-

ment office.

theory—it is

Trade in its attempts to guide in -

extend

inflation

fact, the inflation poten- did not inflate their credit

pledge for credit or sell for cash,]
In the countries which did dethe, government supplies the value their currencies and inflate,
enterprise - cannot be exercised in cash through pouring back into the investors lost in every coun^
the rigid framework of a govern¬ the money stream the funds taken
try, and so did the working man

efforts) of

to

In

and

will be related to the Aiationaliza-r

direct

Denmark,

the gov-; Switzerland, "Swede
n, England;
the public. Canada and United States.
The

The flexibility of mind and mo¬
tives which characterizes private

Republicans to the I

policy,'which, we'are told, at

consumers
Such coun-

Holland,

if

tials have been increased, because
the people have the bonds to

or

present time aims

the

reduction in

We have learned this from

Democrats

tion

were:/

people through government ex- in the thirties. But up until 1934
penditures, there has been no re-« we were justified in. having con¬
officials, tend to take on all the duction of the supply of money: fidence in the soundness of.
the'
narness; and harassments of bur¬ airid
credit, arid consequently no American dollar. The investors

or

the

inflation: ^ But

and

better off.

were

and takes the money out of the United States had its
fling with
people's deposits, and then the gov-/credit inflation in the twenties and
ernment returns the money to the the price we
paid was the collapse

tives, Liberals

Government

spend

down

industries, as already
undertaken in Communist Russia.
Thus, the success off the measure

those

and credit available, alike
and would help hold tries

money

ernment sells bonds to

ternational trade situation. Though
these objects may be attained, it

cies and under direction of its su*
preme

| countries investors

sup-

vestment Bill." It is expected

that the

capi¬

is not ex¬
pected, in view of the Labor party
majority, to have difficult opposi¬

of

a ra

'

phasizing

talistic governments, it

ment

,

is

lished with the bill that this

ency

;

planned economy of the Fascist
and Hitler type!

would keep them, and the
govern-; not inflate or devalue arid which ;
ernment, and "will go a long way ment would keep the, money it;.maintained
Relatively stable credit'
Issues
Committee towards reconciling business v in¬
gets fro m selling ; governmenti conditions, prospered.
In these
the defense (finance) regu¬ terests with
the Control of t In¬ bonds this would reduce the

proposed in

of

';A:;!A;(Continued from page--'837)A

imum, and by taxing away the tion most successfully are the
surplus
money
and
credit' and countries which have had the most
holding it off the market.
A
(stable and prosperous conditions.
The bogey of holding down in- The evidence of this can be found
flation
by
selling
government by examining the records of ecobonds, should be exploded. If the nomic
conditions
since
World
buyers
of
bonds War I.
government
The countries which did

a

Capital

under

British Traditional Policy

v

The Menace of Inflation

ital placement. It will
eventually
set up state economic dictation—

■

,

According to the first section of
the British Government's Capital
Control Bill the Treasury's powers

Thursday, February 14, 1946

PHILADELPHIA,

the benefit of the law of averages

balancing

out

of

Euler

sound

Euler

i

has

.

admitted

(•

PA.—Joseph
Charles -J.

to

partnership in Euler &
Co., 1518 Walnut St... ,
a /^A
■

.<{•"''

X

'.'.'—i'V

.>'•*•?'\v
.' -'*•




'•

'«.»/•
f-

C

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•*/.

i

//" V'.

1

4-

Ar>v;r-Vv'A

;

;

.

v.,/!:

.

0

..

ctfr.

i

u

i-t•,

;«

AAt'AA

v.:
A A v-»A

,

j-',

t

-V

.u

,<: ■}■

>.

I •?). -i

c

■J

2'

\j'i A

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A"/".-;

'A L.y'J

•;

r>:A-fAv:pq

•

j>,

NASB Exonerates Hateey, Stuart S Go.

j

Approval of the State Comrrpswas - necessary
before the

;sion

complainant

(Continued from page 841)

bonds. It

couia

was

.

tne

-issue

for the Connecticut

to
determine
by
from the price we pay you and accrued Commission
you as to-this matter," respondent interest plus any required trans¬ whom evidence might be offered
also sending a copy of this tele¬ fer taxes, or upon your instruc¬
and what evidence might be re¬
at
the
required
public
gram
to the Connecticut' Public tions, we will deliver the Bonds ceived
Utilities Commission. Complainant to the: bidder whose bid is ac¬ hearing. It was for the complain¬
notified the respondent- by tele¬ cepted at the competitive sale and ant to determine whether any of¬
fer made at the public hearing
pay to you any premium over the
gram on April 20, 1945 that "con¬
ditions do not permit of favorable iprice at. which, we purchased the with the permission of the Com¬
Bonds from you less any; required mission; was acceptable
Consideration of your request."
to the
transfer taxes. If the Registration complainant
and for the Com¬
By telegram respondent notified the Connecticut Commission I Statement
pertaining to such mission to determine whether any
on April 24, 1945 that it would be
Bonds shall not become effective such offer, notwithstanding any
present at the hearing upon com-i within such period or such ex- objection of complainant, justified
withholding approval of complain¬
plainant's petition and requested 1 tended per.od as may be
ant's
application.
Consequently,
"an opportunity to be heard with agreed to, you shall
in
participating in the hearing
reference to a request we have the Bonds from us at the price
and introducing evidence with the
made. the Connecticut Light & we pay, you and. accrued
the Connecticut
Ppwer Company to' submit a bid plus ;any required transfer taxes permission; • of
Commission, it cannot be sai'd that
at ijppenl competitive sale for jits.. Wthin thirty,days from
the respondent violated • any law.
proposed Series J bonds."
of the
However, whether a member
;
Respondent had been, unsuc- ♦
has violated Article. III,. Section 1
attempt .in'
Pr^e of 107.50% set
September, 1944 to induce the ln this letter was
re*- of the Rules of Fair Practice does
not
depend. upon : whether the
complainant to offer an issue pf . spondent at. the
member has, on the one hand, resecurities by competitive, bidding, f the^ Commission
.fused to honor obligations legally
:
At the hearing before the Pubtoe . pricey
enforceable in the courts or, - on
lie Utilities Commission, ,upon the 106.980365% at
the other, committed acts which
completion of the presentation of ( ^nt; has agreed to
subject the member to. legal lia¬
the evidence of complainantto [ f bonds to the^eightprivate
bility in the courts. That section
the Commission in support of its j tutions, subject to the

Would

be

to

pleased

hear

.

mutually
repurchase

private
Rules

removed

com-

have

by

a

com¬

the Connecticut
a proposal of a
a question for!
determination by an issuer and by
a
Commission charged with the'
Commission. That

,

duty
tions

.

that

than

the

under

such conduct

the meaning of
•

the

a

not

Governors, with

particpating,
'•

.

de¬
•'

\

found by the,

complaint and
Business

District

Conduct

Com¬

mittee;.,.

or

T^at such acts or practices
do not constitute

b)

;

busiriess^^practices*: withiri
of, the Rule...;
,
A; violation of theV Rules may
not
be
predicated * upon
the
ground that respondent's conduct
created

the Rule.

of

That respondent engaged in
the acts and practices alleged in

urifair

the meaning

-

a)

of

.

Respondent

conduct
standards
and

Inconsistent with - high
of
commercial honor,

principles

just and equitable

of trade;

substantial hazard that

]

;■

complainant's efforts to refund its :fc) That said acts an practices
on advantageous terms
on ef resDondent were not in viola¬
June L' 1945 would-be defeated tion of Section 1 of Article III of
and
that
complainant
would the Rules of Fair, Practice of the

bonds

thereby

deprived

be

of interest

Association;',

requires v Association members to, sayings arid subj ected to the. ri sks
observe
an
ehtical standard of of the bond market for an addi¬
six
months.
Respondent
conduct.; The Securities and Ex¬ tional
change
Commission has ; stated was acting in good fai'th and be¬
lieved that acceptance, of its pro¬
that the; Association is "charge^

proceeding or. to make a state- a registration : statement become With;, the duty in inculcating just
and ethical principles of trade in
ment, and that the Commission effective on May 31, 1945; .and
the
over-the-counter
business."
would not preclude them from that, the offer was not sufficiently
making such a statement, i Re-.1 attractive, definite or binding on (Exchange Act Release 3734.)
Whether, th'e conduct of a mem¬
spondent's representatives, . with- j respondent, to justify him, as
ber in a particular situation vio¬
out becoming parties in the pro-, president; to refuse to go. ahead
lates the rule is a question of fact
deeding,- then -read a, letter from ' with the definite* contracts with
for the determination of the Dis¬
respondent to, complainant, dated the eight purchasers of the bonds
trict Business Conduct Committee
April 25, 1945,. which.. had not at the agreed price, subject to the
.theretofore
been: submitted
to approval of the Connecticut Com- and the BoarR in the light of their
detailed and specialized knowl¬
complainant, which stated:
| mission. Additional objections of
,/V ;
As indicated in our tele-: complainant to respondent's offey edge pf the trade practices gen¬
erally accepted and observed by
gram of April 19, 1945, it is our are set forth in the,pleadings,
the great m a j ority of members: of
opinion - that, you can. receive the. . On April 26. 1945 the Connectithe trade. They must bring their
highest possible prices for j your ^cUt Public Utilities "Commission
Bonds only by offering, them; at* entered ah: order, approving the knowledge .oi; trade • practices ; to
bear upon the case and make their

members

termines:

pro¬

unethical

Board

The

4

be said that

an

was

of making such determina¬
cannot constitute unethical

unfair business conduct within

or

posed private placement contract.
In view of the good faith of re¬

spondent, it cannot

re¬

or

member raises such

proposal which was complicated
by the pendency of the applica¬
tion for approval of the private
placement. In the view of re¬
spondent the circumstances re¬
quired respondent to guarantee
that the price to the issuer in its
proposal would- be equal to or
better

suffi-'

was

justify

to

and ultimately by

definitive

a

hazard

serious

quire
rejection of respondent's
proposal was in the first instance"
for determination by complainant

firm

earlier submission of

.

Respondent were
present, had ;• it would be impossible to
asked permission to appear, in the plete the necessary; work to

ciently

that business is

the realm of

from

the

whether

Under
the
a
right in

contract and
respondent acted in good faith.
The six-day notice afforded little
time
for
the
preparation
and
petition

the «ate
expiration of. such option

.

have

for business until

■

forth
inserted by;
hearing .before
after complainant
of
which complamsell the Series
mstiapproval of
application for, approval,of, the the Connecticut Commission,
private
sale,
the Commission j - Thereafter comnlairiant's Drortstated- that, representatives, from dent testified at the hearing that

placement.

members

good faith to solicit and to press

interest

.

865

CHRONICLE

THE COMMERCIAL & FINANCIAL

[Volume 163:' Number 4464

(vd) That the decision of the Dis¬
trict Business

should

[ e). That the complaint be,

*:

would not subject com¬
plainant to these hazards. Whether,
contrary to respondent's; belief,
the
acceptance
of respondent's

hazard

the Complainant and, if so,

upon

is, re¬

versed

posal

proposal would cast such a

Conduct Committee

and it hereby

be,

is, dismissed.

it hereby

For the Board of

I

By

arid
"

•

...

Governqps. vi

/S/ Wallace H.. Fulton,

.

.

'Executive Director.

'

Feb. 4,1946.

J

v

-

. -

(Special to- The

j

?

CITY,

BAY,

Carrison, Jr.,

.

Financial

(Special

Chronicle)

to

The Financial

Chronicle)

r

C. ir GRAND RAPIDS, MICH.—Clar¬
ence D. Allen has joined the staff
has become associ¬
i'MICH.—Louis

Co., Asso¬

of Dudley H. Waters &

competitive said.' We have proposed sale by private places
ated with Merrill Lynch, Pierce,
ciation. of
Commerce
Building,
requested an opportunity to sub- j ment as requested - in complain- determinate in the light of their Feriner # Beane.: Prior to serving
after serving in the U. S. Navy.
experience^, as" technician^ iniiihe
mit* a
bid
for
your,; proposed ant's application. Notice of intenin the U. S. Army Mr. Garrison was
securities markets rather than as
In the. past he was with Brad¬
Beries J • Bonds at. such a .sale,, but tiOn to redeem the Series; G bonds
iri charge of i the Bay City office
bury-Ames & Company; " *"
lay jurors or as judges. (Exchange
of Humphries, Angstrom & Co.
you have advised us that condi-; was published on May. 1,1945, the
Act Release No. 3623.)
tions do- not permit of favorable Series J bonds were delivered arid
(Special to The Finanoial Chroni<£e)"; 0
The Board of Governors con¬
(Special to The Financial Chronicle)
consideration of our request.
§| paid for on May 28, 1945 and the
HARTFORD; CONN.—Mrs, Rose
v
"Therefore, in order that you feries G b-^nds were redeemed on curs in the District Committee's
CLEVELAND, OHIO—Harry W.
finding Rb&t respondent's proposal Myers has been added to the staff Schnitman has joined the staff of
may have the necessary funds in; JuneT, 1945.
Rime to causejthe.requisiteBrisjness:Conduct]
^made>.ir^b^i faith, ^jand of Paul IL Davis & Co., Union Mansfield & Co., .49 Pearl Street.*,
under -all of th ec circumstances of Commerce Building. •
to.be published for redemption lof| Commfee stated Rhat while there
this case the Board of Oovernors
(Special, to The FinaWial Chronicle)
your Series G bonds on" June I»f was no evidence to' support a con*
(Special to The Financial Chronicle) 1945 and at the same timeto en-, cmsion vfhat respondent acted in concludes that the action. of re¬
INDIANAPOLIS, IND.—Fred S.
-able you to obtain the advantages, ^ad faith or was not ready to act spondent in exercising its right to
CLEVELAND, OHIO-r-Ivan; V. Kuethe is with Slayton & Co., Inc.
,of offering" your proposed Series immediately, on its offer had it object to the proposed sale at the- Smith has rejoined the First Cleve¬
hearing before: the Connecticut land Corp.> National City Bank
J- Bonds at; open competitive sale, "^gen
.(Special to The Financial Chronicle)
accepted, it nevertheless
Commission,; and support its ob¬ Building, after serving- in the
we hereby make you the proposal; conciU(jed that:
KANSAS CITY, MO.—Edward
outlined below. Such proposal is
j ) Respondent at the hearing jection to approval of the applica¬ armed forces.
vV
O* Prothman and James .A* Ross
.predicated- on the conditions that cn Aprij 25, 1945 "sought to en- tion with its own offer in good
are with BauirivBernheimer Com¬
faith to purchase the bonds at a
(Special to The Financial Chronicle)
;-(a) you register such Bonds under .
a proposal on an occasion arid
pany, 10 16 Baltimore Avenue.
.
the Securities Act -of 1933, .as, under such circumstances a£ to higher price with a subsequent
CLEVELAND, OHIO—Charle^
amended, and that a registration make
difficult and embarrassing offering of such bonds by open J. Kilroy has become associated
•(Special to The financial Chronicle)
;
statement covering such Bonds for complainant to ignore the competitive bidd ing, did not con¬ with Ginther & Co., Union Com¬
KANSAS CITY, MO —Grace G.
(shall become effective on or be- proposal. It was a high-pressure stitute conduct inconsistent with merce Building. He has - recently Court is with Herrick, Waddell &
standards
of
commercial been with Dun & Bradstreet, Inc.
fore. May 31, 1945 or such later; attempt to sell respondent's serv- high
Co., Inc., 1012 Baltimore Avenue.
dpte as may be mutually agreed jces ancj to compete for the issue honor and j ust and equitable Prior thereto* he was with Otis &
principles of trade, as used; in Co. arid the Cleveland Stock Ex¬
to, (b) the issuance and sale of under competitive bidding";
(Special to The Financial Chronicle)
'such Bonds shall be approved by
2) While "it is difficult to de- Section 1 of Article' III of the change.
MIAMI, FLA.—Sam V. Silsbee
-the Connecticut Public Utilities ^ne exactly the precise conditions Rules.
At the hearing before the State
is with Frank D, Newman & Co.,
Commission,; and. (c) you will of- under which aggressive efforts to
(Special, to The Financial Chronicle)
Ingraham Building.
•.
•
^fer: such Bonds by open cqmpeti- estabiish: business; contacts cease1 Commission ori April 25, 1945 re¬
CLEVELAND, OHIO—Ralph F.
tive bidding.
I to be legitimate and exceed rea- spondent knew that complainant
Huller
and
Frederick J. King
had ^entered into contracts with
(Special to The Financial Chronicle) '
1. We will purchase your pro- ; soriable limits," the ^Association
have rejoined Hawley, Shepard &
eight institutions for the sale of
PORTLAND, ORE.—Vernon C.
posed issue of $16,000,000 First -must "exact from its; jnembers
Co., Union Commerce Building,
its Series J bonds, subject to the
and
Refunding^ Mortgagee -3% -compliance with high standards Of
after serving in the armed forces. Ryder is with Daugherty, Cole &
approval of .the State Commission.
Co., U. S. National Bank Building,
>Bonds, Series J, at 107.50% of the. commercial honor so that there;
One of respondent's purposes in
He was formerly with Conrad,
•principal amount, plus any ac- will exist that degree 6f restraint
(Special to The Financial Chronicle)
appearing at the hearing and pre¬
Bruce & Co. for many years.
crued interest, or in the event and ethical decency which are;
COLUMBUS, OHIO—Henry B.
senting its offer was to induce the
that delivery arid payment are necessary for the protection of the
rejoined The Ohio
Connectcut Commission to with¬ Richter has
made prior to-May 1,- less interest public";
(Special to The Financial Chronicle)
hold approval of the private place¬ Company, 51 North High Street,
on
the Bonds from- the date of
3) Respondent's "publication at.
ST.1 LOUIS,
MO.—David B.
ment which had been negotiated. after serving in the arrried forces.
payment to May 1,1945. We agree the ; hearing of a proposal adFrancis m has become associated
'I'.
'I
•);
'
VA.
'J*'1'
To the extent that respondent's
to accept delivery of anylpay for dressed
to, but not previously
with Newhard, Cook & Company,
action
was
intended
to
bring W-(Special to '^he Financial Chr6nicle)
(such Bonds on any date prior to shown: to, the complainant, was
400 Olive Street, after serving in
about withholding of Commission
t COLUMBUS, OHIO—Robert F.
iMay 15, 1945 fixed by the Com- clearly a planned last-minute atthe U, S. Navy. - In the past he was
open

7

,

'

:

■

—

_

,

v

'

•/.

•

,.pany on

three days' written

notice tempt to embarrass - and harrass

shall be re-j complainant Unto doing business
jdeemable at prices to be determ- .on respondent'^ terms and regard-;
.ined in accordance with theaisual less of all - other consideration" j
call price formula used in com- andi

>to

us.

Such Bonds

•

bidding;>:v^T;v,;s^^.,Jrv [ .-4)- Respondeat „ "indulged ; in
simultaneously, grant high-pressure tactics without
'. you an option for, thirty days. (or j proner consideration for complain*
such extended period as may be ant's wishes and without obserVa-i
.tion ..of elemental principles of
mutually <agreed to)-, after the de¬
fpetitive-

t

.

2,-We will

~

v

..

j-

a

breach

tract by one of the

of

a

firm

con¬




"'t

,

III of the Rules.;
either

because

& Company,

with VerHuntington Bank

S5

.

/

J'■ "S'v"i'¥";

i

(Special to The Financial

■DAYTON,.

Respondent did not violate the
had

,

■Building.;

parties thereto,

tive

bidding and declined to ne*
gotiate, with respondent for this
particular issue, or-; because • re¬
spondent inserted the price in its

^

(Special to Tetc Financial
,,

OHIO—Harlatt S.
affiliated with

Hosier has become

complainant Slayton «Sr Company, Inc.

with Francis, Bro. Co.

.'

^

r

Ohronicle)

|

ST.

tus

.

(Special to The Financial

DENVER,'

Chronicle)

'

;

LOUIS,;! MO,—Eugene. Ret-

has

become

connected .with

Army," J.,: "

—f4

Chronicle)

COLC). — Paul

H.

Cunriiri gham, Jr.*, is; now with' Pe¬
ters,Writer

*-

Smith, Moore & Company, 509
Olive Street, after serving iri the
U. S.

previously rejected competir

"or decency and courtesy which are
bid inherent, in the conception of high
honor'*
at a competitive sale is accepted, standards of commercial
of Article proposal after disclosure of the
•whichever date is earlier, to re-I jn violation of Section 1 0.1
purchase such Bonds from, us at III of the Rules of Fair Practice, price in the proposed contract for
livery of the Bonds to
us
through the date on which a

coe

in violation of Section 1 of Article

Rule

•

Ruhl is now connected

approval, respondent's conduct
did not constitute an attempt to
induce

.

& Christeriseri,

Inc.,

U. S. National Bank Building.

(Special

to The

S TOLEDO,

Financial

OHIO

—

Chronicle)

Urbaa

'
.

B.

Stedman is with Slayton & Com¬
pany,

Inc.,

866

THE COMMERCIAL & FINANCIAL CHRONICLE
in

other countries, especially in
South America.
These countries

The Credit to Britain

P

will

has plunged
Great Britain.
partial solution I am think¬
ing about is the Anglo-American

miner

manufacturer

economic
ments.

■

In the
and

financial V agree¬

and
■/<,:,

in

world

become familiar to all of

have

ple bought about a fifth of all the
goods that were exported by all
cus¬

tomer. They were the largest austomer 'of many other countries.
their

course

has

the

which is far
sion

,

agreements

*

:

several

have

;

we

objec¬

k '

t

-

been

.

and

The

British

abroad.

At

sacrificed

borrowed

the

heavily
time they

same

their

which

than

the

entire

must

United

economy

But

which

we

the

do

is

con¬

Isles. A multitude

running

been

credit

and

surpluses remaining in

British

claims

do.

unless

lend-lease

reverse

American

Britain

States.

reconstruct,

not have to

be repaid.

It should be realized,

however, that the circumstances
surrounding this credit are en¬

burned out tanks

as a

commercial

crnvert and
is

Britain

a

has

of

has
balance struck,

both

considered,

and

extended

to reconstruct. Until

done,

Britain's

reach

cannot
much

less

the

an

expanded

situation

a

Yet

it

purchases
volume,

old

is

volume.

cannot

cure

essential

for

it¬

the

economic health of the world that
it be cured quickly.
'
* 1
♦

imagines' that the finan¬

one

cial agreements alone will
remedy
this situation. Whether or not the

Congress

approves
the
agree¬
ments, the British people face a
lean period that will continue for
some

But

years.

the

financial

agreements will permit the Brit¬
to

buy

food

and

machinery
first

restore their economy.

Here

in

the

United States

we

in

mid-passage in our recon¬
version. Despite the pressure of
events abroad, even a
Secretary
State

is

that delay

of

aware

our

the

passage.

storms

Certainly

a

Secretary of State who was
formerly Director of War Mobil¬
ization

is

with the

ways

agreed

to

pay,

thorny character of price

disputes.

.

that

you

when

have

we

settled the industrial disputes
and
in

problems

become
our

more

ultimate

depends
omy

that

are

u^so insistently,

on

upon

of

the

chains.

crowding
shall

we

keenly aware that
prosperity- heavily
whether the

is

continue

world

is

econ¬

free

or

in

the interest rate

British

made

higher.-The

was

full

all

payments

called
to

upon

reveal

Supreme

to

decide

variety of

a

or

restrict interstate

The^e

merce.

suggest

have not fully learned
at home.

even

But

com¬

that
our

er

lesson

..

in

grower

the
of

Dakotas,
the

Carolinas

market gardener
not

the

of

cotton
or

the

California is

directly linked to that of the




Even after

/

t

from this phase

of these agreements is the British

commitment to support the United
trade proposals.
By this

"commitment the British take their
our side as our economic

place at

allies'and not otir economicen¬
emies.
x
Before the outbreak of the war,
the

As you are

X

fore

the

and

the

dollar

world's

aware, be-,
pound sterling;

the

cies in which

the

were

curren¬

one-half of the

over

trade

;

doubt

no

war

was

carried

on; It
is likely that even a
higher share
of» it will be conducted in
pounds
and dollars in this
postwar

riod.

'

-

.

;

'

It requires no abstract
analysis
to understand that the free inter-'

change Qf these two currencies at
a. .stable, rate is basic to
world
prosperity. If interchange is not
free and easy* the ;
trade7 worlcf f
tends to freeze into two
separate
each contained within ad.=
economic Chinese wall. The com-<

areas,

mercial horizons for each business
man

are
narrowed, because a
large fraction of his potential
buyers or suppliers are placed be-x

yond his reach;
~
But; if interchange is free and
„

easy, t business

men*

can
Operate
with* the assurance that'the
pay-*.

menfs they receive, for the goods
they sell abroad can be spent
anywhere in the world. They are I
free to seek their natural sources
mar¬

kets*. When this js true,Vthe vol-;
ume of trade grows, smoke
rises?
from the factories, jobs are plenty
ful and pay envelopes full, and
farmers can .expect a fair return/
on their crops.
*

tf Against the background pf these|
facts, the importance of the
nancial agreement is clear to

fi4
see.

&

Jhe British today have yery fe>y>
.dollars with which io pay for the
imports they require. They are
forced to conserve these dollarsv
As I read in the newspapers a few
days ago, one way in which they;

that they made

.

That, briefly, is the loan. To

quite
natural
should be raised.
have

ample,

years

a

of this

heard

magnitude it is
that
objections
,

it said,

that the

credit

for

ex¬

will

con¬

tribute to inflation in this coun¬
try. If a sum of this size were all
to

be

for

drawn

scarce

would

that

indeed

will

at

once

and

consumers

not

be

The

it

But

British

certainly will conserve the funds,
drawing from them only as need¬
ed

between

now

and

1951,.

con¬

themselves. They will spend it for
what they must buy abroad—food
basic

raw

materials.

countries
to avoid

instance, cotton—already

are

And

we

and other

are

a

going to take steps
repetition of 1929. • .

Britain. Can Repay

ing the agre.ed payments.- If
another

occur,

larger

values

ments

on

great
shall

we

this

than

we

depression
lose

the

credit.;

.

much

install¬
'

.

The objection also is heard
that,
while this British credit is
justi¬

fied, it should

not be granted be¬
it will require us to make
loans
to
other
govern¬

similar
ments.

With

surplus in this country, and
other items doubtless will be in

surplus before 1951. We shall soon
be glad of British markets for

for

cause

lard, apples, tobacco and

this

argument

disagree.

I

world

also

for

wheat

after

no

the

doubt

present
shortage has been relieved.
V
Some of the credit will be
spent

This

ing

credit

^

is

not

a

-

*

precedent

anything.

It is unique, be¬
position of Britain in
trade, her need for work¬
capital and the Effect upon
the

world trade of her

working capital, all

on a

acquiring that
are unique. ;

should

be

con¬

business basis and not

phase of political action.

as a

We

can

loosening
and

look

to

ahead

the

of

combines

grip

also

of

world

upon

,

to

a

cartels
com¬

multilateral

arrange¬
ments for the handling of surplus
merce;

and

to

and

price-fixing arrangements.

The United States believes that

these
served

J-

not relaxed, and
to

be

they would have
These

extended.

controls

would

necessarily
discriminate
against the United States, because
:in normal times
customers

than

our

sellers.
I

our

sales to Brit-;,

always larger
purchases from British
are

„:v.; ; 'xX./ /x-'xv x
'
discovered in my own

,

■.

have

objectives
will
be
best thinking about these matters that;
by the establishment of an concrete examples are most help-^

International

Trade

Organization

and Social
Council of the United Nations. We

under

arranges, itself naturally, Great
Britain would have to do this
by

government decree. The war con-:
trols would have to be continued,

progressive ish

limitation upon export restrictions

should have little difficulty meet¬

permit

business

national

ducted

commodities;

,

If business activity remains
high
and trade large,
Great Britain

cause

Some of the things
they buy—

for

not reduce it.

to

,

sumer-manufactured
goods
be¬
cause
they make
these
goods

and

been and is to seek * their
gradual reduction by; negotiations
under the Trade Agreements Act.
We are seeking to
expand trade,

spent

goods,

serious.

occur.

has

in

no

of

v

Dollar-Pound Stability

■

we

American seriously con¬
this day and age that
the prosperity of the wheat farm¬
tends

ill
the

sow
•

of supplies and their natural

-

States

Second; The earlier British debt
was
larger than this credit, and

engender
and
■

'

They will not spend it for

attempts by the .several states to
burden

prorextension

Support Proposals

us

poverty,

pe-

^

judgment among the
significant of the benefits

which flow to

break¬

v.

,

The lawsuits which the

Court

•

my

most

to

economic
throttle
trade,'

"

I

Secretary of State I sug¬

as

to

other

on
an

dollar

area

efforts

power¬

-

Free Commerce Needed

gest

an

shall

we
a

world was beginning to fall
into narrow and tight commercial
token
compartments.
In many ways,
est public attention is the exten¬ payments in 1,932 and.1933.,
Al¬
the: war gave impetus to this de¬
sion of a line of credit to the together they paid us over $2 bil¬
have conserved dollars is by
cut^l
velopment. Unless the most pow¬
United
Kingdom * totalling i $3,- lion, principal and interest. That
erful and ' united effort is made ting .from their menu the dried,
750,000,000, This credit may be is not a record of intentional de¬ now! to
"eggs they, had been obtaining.
achieve a vsharp aboutdrawn upon at any time from the fault.
from the United States. The same;
face, we cannot hope to realize the
date Congress approves the loan
Third; Last time we raised our traditional
liberal
American newspaper account added that the i
agreement until Dec. 31, 1951. It tariffs in 1921, again in
1922, and dream of a freer world of trade. British Admiralty has : ordered *
will, of course,, be used gradually. again in 1930. The British could
British ships to avoid the Panama
The partnership of Great Brit¬
The sums actually borrowed are only pay us back by .selling goods
Canal as much as possible be4
ain im this undertaking is, conse¬
to be repaid during the 50 year to us, and yet by increased tariff
cause of the dollars toll;
quently of the first impoprtance.
duties we made it harder and
period beginning in 1951, with
But it matters not how much the
The British Alternative
interest at 2%. The United King¬ harder for British goods to enter
British may wish it otherwise;
dom
Unless: * the British" receive•this
may
request
the United this country.
they can join this- partnership loan of dollars from
States to waive the collectioni of
the United.
Even more important; last time
only if the financial agreements
interest in any year in which we and the rest of
States, only one course, will be.«
the world let are approved.
British income from sales abroad the
open to them. ' They must buy
X- X 'X ''' * XX'
great
depression
< Y -X 'X .'.X
happen.
and other sources is not enough to When it
what they need almost exclusive^
Dropping of Barriers Forecast
happened goods stopped
enable Great Britain to bring in
ly from the countries which nor¬
moving, and earnings collapsed.
If the loan is approved, we can
mally buy equal or larger amounts
imports at the average prewar It was that, more than
anything look ahead with considerable con¬
level. This is a wise provision in
else, which stopped the payments fidence to a general reduction of from them, Or they must buy from
a
countries which are willing to ac¬
contract of such long duration. on the British
debt.
tariffs
and
the
elimination
of
It is not the course of wisdom to
cept payment in pounds and soend •
This time we are firmly set on preferences;
tb ■ a • minimum of the;■
insist on interest payments when
pounds for goods in Great;
a
different course. We are not quotas and embargoes; to an in¬
Britain or in some other part of
world trade conditions may some¬
going to raise tariffs. The settled telligent and restrained report to
the sterling area,'
times make suchr payments im¬
'
»'
policy of Congress and of the government subsidies; to general
possible.
Since this is not the way traole
/
'V'
President for more than 12
acceptance of the rule that inter¬

which has commanded the, great¬

uncomfortably familiar transaction

and wage

But

than

CA*

•

materials—thex

raw

things they need in the effort to

of

more

Britain to
In

payment.

,

are

understanding '
policy; by

that the agreements

for

"sterling

,

and

exten¬

of credit, because they contain a
pledge on Britain's part to re¬
move as rapidly as possible the
emergency controls over foreign
exchange, to abolish the so-called

-Another
objection
has
been
suggested by history. This is the
assertion that the credit will never

f to the British, they cannot pur- with interest and over 50 years, through the 1920's, and continued
cha«e abroad the goods and equip- the sum of 650 million dollars,
x them: until
the great. depression
% ment they meed in order to re-:
The provision of the agreements caused the Moratorium of
1931.

ish

an

an

agreement

an

v

say

vide

obligation. This credit is for new
goods which will help create new
payment we
sought for. these production and new wealth. Like
any
good commercial loan, it
goods.
^
But Britain
will pay us for helps create, the means of its own

war. Now, Britain must recon¬
vert, and on a much larger scale

No

is

than

by

trade-

Day have been
disposed of. The victory was the

to

Such

more

credit;

over-all commercial

sumed before V-J

export trade and

their

converted

self.

of

an

may well

harmful

which

among nations,
of conflict.

^

agreement

an-

terials delivered under lend-lease

sunk,

this

by

aut

nations

loan precedent be

a

:

,

seeds

Develop¬

by. the. 34

up

Nor could

lies

answer

and

pool," to
tirely different from those apply¬ abandon
discriminatory
import
war account. Those who remem¬
ing to the British debt after the restrictions, to participate ill next
ber
how ' the
last
war's_ debts first World War.
summer's negotiations for reduc¬
haunted the world will welcome
First: That debt was incurred tion of world trade barriers, and
the expeditious
disposal of this for
to support the Proposals for the
materials largely destroyed in
issue.
'
the fighting—goods that created Expansion of World Trade and
Our
claims
on
Britain ^nd
Employment, which our Govern¬
no new wealth or
earning power*
Britain's claims on us for ma¬
This time we are not treating ment ' published, last December. /

out of existence. Many
investments have been
...scfld and foreign properties dam¬
aged or destroyed. Much of Brit¬

t

us.

We have acted first to settle the

bombed

J

to

concern

drafted to help meet those

tives,

foreign

fleet

the

set

established

Comparsion With World Debts

re¬

economic

difficulties

third

merchant

in

I would be

omy.

Concern

have

in 1939. Many

ain's

of direct

are

<

as

a

inflation

I

of what.they were
of their plants pro¬
ducing goods for export have been
about

'

Our

Thus Britain's difficulties in

they emerge from the
war
in which they suffered so
bitterly, their exports are down to
Now,

ment,

the

The

] chant fleet.
■V,-,

unless

for

pressure

Reconstruction

signing the Bretton Woods agree¬
ment, should be ready to v take
over much of this activity.:

danger.
primarily in
speedy, large-scale production of
the things of which we are short.
But

maintain

turning to normal economic inter¬

investments,
earnings of their meroverseas

and in the

The

this country is great.
the last to minimize

in the United

goal

our

Britain's Welfare

They paid in goods,' in the income
from

as

for

our

those

perpetuate

Bank

Restricting the ability of foreign agreement which thus becomes a
outlets
for
our
production are purchasers to
buy the things we joint advance by two of the
larger than they have ever been have in abundance
only adds an world's largest economic units oh
before in peacetime.
additional handicap to our econ¬ the
general problems. of world

the other countries in world trade.

largest single

set

will

ex¬

the high level of employment we

peo¬

in

that

tive

v

States cannot reach and

British

ally

practices

time the International

vviwu

the support of

won

down

orders will be warmly welcomed.

we

have
ful

existing powers and will make
others, at least through 1946. By

apparent.

less

to

loans for these purposes under its

real. Prosperity

as

markets.

Plight of Britain

Before the war, the

were our

the inter¬

pansion both of production and of

.'

us.

quite

We know that

They

the

and

York.

here and abroad requires the

evoked, the nature of the
problem facing Great Britain has

reconstruct and improve
industry and transport. The
Export-Import Bank has; made

enormously expanded our produc¬
capacity for equipment of
this kind, and increased
foreign

is

economy

But it is

that these agreements

have

The

New

for granted

vw

panding world economy
be frustrated. With
it,

cap¬

buy from us is mainly capita',
equipment: machine tools, diesel.
engines,
generators, ri. and g ma¬
chinery of every kind. The war

dependence of the national econ¬
The interdependence of the

discussion

of the

course

debate

Pennsylvania

.—-w*

countries do need

What the South Americans wish

omy.

..;v.:x

r

in

take

Loans

their

to

The

We

ital

i,

(Continued from page 831)
war

Several

;

thus

Thursday, February 14, 1946

.

Other

acquire additional dol¬
lars which they can use for pur¬
chases here.
o

And World Trade

.

the

Economic

ful.

As

United

an

illustration of how the

States

suffers

from

;

the,

so-called
sterling bloc arrange-J;
that
the
International ment,. let us suppose that a
busi-,
Organization can become ness man in India makes a sale,
of
one of the most important foun¬
cotton
to
an
importer
in
dations of a lasting peace.
England.
" :
•
:
'• ;

believe

Trade

The organization gives promise
of
if

becoming a strong foundation
it

is

to

include Great Britain.
Britain it might

The man from India receives
pounds sterling for this cotton, not

dollars.

Without

Great

succeed,

but its prospects would
Clearly we have a

ner

But he does not

even

re¬

ceive

pounds sterling in a man¬
which permits him to convert

not be bright.

them

into

great stake in this program.
The British credit is a large in¬

ficial

license.

vestment

undertaken

l^rcfor*

VP.

to

gain

"Without

dollars

the business

an

even

it.

ceeds

if

of

he

without

The

man

result

in India

wishes,

the

cotton

use

an

is

cannot,5

the

sale

of¬
that

to

pro-'
buy

..

,

•;.', *«

•

Volume 163

electric

If

in

motors

States.

,

'

Number 4464

substantially in 1946, but we will

United

the

Present Production Problems

electric

needs

her

867

THE COMMERCIAL & FINANCIAL CHRONICLE

motors, he must purchase them in
England or in some other sterling
CQuntry.
.>;;
v
.A further result is that the
electric motor manufacturer loses

products,

the

at

be

(Continued from page 839)
but still: we fell far

v

short of

or later,' if this situation
prolonged, the United States
might find it necessary to retali¬
ate in kind; against thii* discrim¬
ination*
This is not a prospect
which
anyone
in
either
Great

Britain

than

suppliers
H

our

do. '

United

the

or

States,

Fortunately,

or

agreements are approved, this un^

prospect is removed..: For
the
agreements, . the £ British

happy
in.

Government

makes

firm

\y /.

because

continued at

the system should be

railroads

the
'

Ford

cannot

least in part.

'•S.'Vl"."-'

costs

were

mitment. to terminate and modify

were

'

■

•.

couldn't,

payment
can- use

in

countries where the

principal international currency is
the British pound,

In

strike.

time

they will make

arrangements -for: the free, inter¬
change" of pounds sterling and

But

start closing

to

scheduled
Feb.

on

down

1
our

They agree that within, a year,
in transactions with all countries,
pounds sterling will be exchange*
able for any currency which may
be desired by a seller to a British
purchaser.
You will realize that I have not

$124.

of

being $76 were up to
Material costs had gone up

assem¬

rates

We

so

war,

cars

production; Would be

skip- for any comr
parisons
to
November,
1945—
three months after V-J Day. That,
to

necessary

by the way, is the month; in which
we expected to get back into full

post-war
time we

production.
By that
hoped;fo be turning out
cars- to
get our costs

their commitment to support our

employment proposals,
tangible, firm gains for the

,! United States and for the rest of
tbe worldi.
What

,

we

gain is the chance fqr

The British credit is a large in¬
vestment undertaken

gain

to

an

larger objective*' Without it
construct

efforts' to

our

an

ex¬

panding world economy may -well
be frustrated. With; it we- shall
have

ful

won

the support b£ra power¬

efforts to break
economic
practices which; - throttle
trade,
perpetuate; poverty, engender ill
Willi among nations ' and sow the
ally in

down

our.

those

harmful

seeds of conflict,.

'

'

*

Mail Privileges
Restored to "Esquire" >
~The
Feb.

U.

S.

ruled

4

Stating that the
lower court deci¬

Washington-;Feb. 4 said:

Former
Frank

C.

quire"

;

General

Postmaster
Walker

banned

the ground it did not
.1 postal law requirement
the inexpensive second

privileges a publication must
of

information

a

public character"'or be "devoted
literature, the sciences, arts or

to

special industry."

t




.

1941.

over

These

pretty well why we have sought
solid
assurances
of
increased
worker output - from the Union,
for

Our? search
has

no

chance

lower costs

ever

of success if this

road;

Labor costs,

in

\ <;

•

v.

prices — namely
fair and vigorous

The

means

too

that way
i

considered that

Ford Motor Company
much to
too
many

seriously to consider
out,.

people for
Second

us

possible

choice

was

attack OPA, take our case
American

I

people.

to

controls,

Government

denounce

that.

to the

;

We didn't take that road either.

We have continually laid our case

of

you will probably have- estimated
already, were at least1 $1,000*
As
a

matter

of

fact, they were $T,-

041.26. '

*

-

It will interest you to know

?

-

tions.

•

.

„.

,

'

that

to

-charge

"No."

high'

.

couldn't

Let's

Supply Problem;

take;

a

look

supply problem.
the

; I

problems 1 am

next

at

the

sure

the conditions I am describing are
familiar to you.
There

are

some

.

days

V
on

which

the mailman brings us more from

said

OPA

produce " parts
so >

business.

-

at

that

he went out of the
;

.

We, of course, had to look for
of supply.!" We went
shopping immediately and finally

a

new source

two

got

suppliers.
One is
us with the neces¬

parts at 82 cents and

sary

84 cents

I

new

furnishing

I

am

attacking. ■ the

of the other Government

are

have

sustaining

Ford

Motor
any

demnation.
reasons
v;

and

conditions

Neither I

Company

such

or

con¬

produced

the

have described.

-make

that

gamble

statement.

tor

,

established

an.y

Only

things.

ing

business

profits

of

out

the capital for new tools,

can come

plants, new techniques in
Only out of profits
production.
can come higher wages, improved

new

working conditions, and new op¬

portunities for employees.

.

Together to Produce

Work

.

.

It

to

seems

More

that there is one

us

possible solution to our problems
—yours, and ours, and the prob¬
lems

It

of all

seems

of

in this country.

us

to us that the one prom¬

ising road to peace and plenty is
for all of us to pitch in and work
—for all of us to produce—for all
of

us

aside

set

to

other

all

siderations until some future

con¬

daflc

problems,
of our country and the world by
the kind of production that comes
from hard, honest work.

and to meet the current

-

Somehow, it seems to me, if wethat ; we will get out of the

do

,

jams in which we find our¬
selves. We must use our greatest

many

and effort as manufac-

earnings and is plowing them

back
penny

into

.

the

business.

Every

has been committed to the

improvement and expansion of the
plant, machinery, and facilities
the

comfort: and

of employees.

convenience
.

,

nor

I

the

should

sweeping

con¬

There may be sound

in the public interest why
' 'k

V:

Here again we are putting our
bets on the future — on going
ahead—on getting

think

greater produc¬

and, what is just as impor¬
tant,! greater productivity.
;
tion

our

i

friends among the union

leaders have

a

big educational jot)'

if labor and management

working;

together expect to do a real job
of work for the; American people*;
And if only 6> men out of 10
union

men

non-^

believe in doing their

best, then I think we all have a

job to do.
The

reconversion

battle v is not

going; to, be won by speeches
mine

,

,

place the Ford Mo¬

Company has taken all of, its

war.

for
ap¬

Office of Price Administration

which

we are taking a great
without, supporting; that

to you

.

here

not

at

one

each, both with OPA
v.1 V v

I do not think that I should say

In the first

.

;

trols

that
outlining and
am

cents.

figure and

any

The

81

They- were willing to go as
54 cents but the supplier

proval.

sell for"

can

auto- > pared; to; non*union- men, then I

It seemed to us that the

mobiles.

as

$728 this. car which- cost
us—without
profit or anything
"to grow on"—$1,041. 4
>.

some

But only out of prof¬

ican notion.

,

jthat we could to produce

Price Ceilings

now

that

as

The third

Price

month—November;
1945—we were authorized by the
Office of Price Administration to

in

to speak of making
if it were an un-Amer¬

fashionable

profits,

-m a r*

$152—almost 100%, more than in
greatest; contribution-; we ; could
make as citizens of a great, coun¬
1941, and overhead costs in¬
creased to $354 or 167% more than,
try would be to get the assembly
lines moving, to get out the cars,
im 1941, • "Overhead" < includes'
been making thousands of small
cosh of plant maintenance during
to help, meet the- national threat
but vital' truck parts for us for
work stoppages.
bf: inflation/ which exists in free
50 .cents each.
His material prices
Bear in mifid; that the figures I
money that; wants to buy but can't
had gone up so much after V-J
have been quoting you are merely
find: the. things; to
buy which
manufacturing costs. They do not Pay, he asked OPA for permission people want; and need.

profit, our total costs, as many

It has become somewhat un¬

vCferfi Government and the OPxV*^ V£Vt,e +n manufacture ?n th a fa pp
nfn mi
turers to
in the face
itself, but if price control is in the of
very great obstacles. We must
public interest and a majority of use our
great ingenuity and effort
the people of this country think
as labor leaders to meet the prob¬
so, we are prepared to do our very
lem of a falling productivity rate
best to live under existing condi¬
among workers. We must use our

ceiling: play havoc with
bur production efforts in a num¬
ber of ways.
Consider this case,
for: example,
A supplier, had

profit;

itself in moments of emerg¬

nance

ency.

not

to fir

reserves

up

,

short, rose to

dis¬

building

greatest ingenuity and effort as
possible choice, as we
overnment
officials and legis*
saw it, Was to stick if out and toi
There
a' third grdup* of sup¬
]^'6rs to get us clear of unnecesdo our utmost to produce. ; It is
pliers who' have; taken another
sary entanglements and out in the
road out;} They, too, find, their our feeling that this country and open again.
costs, way above the selling price the people in it—and that includes
We must popularize the notion
they are allowed to put on their especially the working men in of work—and the best way to pop-.
.
products, but fhey have merely this country—face a very great - *
that I know of is to do
i.nlocc
nvnrln^mn
r,f
UiailZe H, Midi I KIIOW Ul,
IU UU
switched
over
into
some
other danger unless the production of it: A recent
opinion poll shows
pusihess where there are no ceil¬ goods can be vastly increased. that less; than 45% ; of factory
ing price problems.
A foundry People have nionefy> Jt is money workers belonging to unions think
Which has supplied us for many Which can be thrown into a panic.
they should turn out as much
years With
gray
iron castings It is money which can rush hither work as they are able on any job;
gave
us
our patterns back not and yon pushing up prices, creat¬
and
44%
of them say a
man
long ago*, During 1945 they lost ing black markets, blowing up the should do about what the average
whirlwind, of uncontrollable;in¬
$330,000 because the cost to - them
of his group does.
Among non¬
of
producing
the
castings • we flation.
union factory workers 60% think
The Decision
jaeeded was above the price at
a man should do all that he can
Which they were allowed to sell \ The decision which we made, and 33% say he should do about
ps castings;
They; told* us they therefore, was to take a very big as much as the average man in
Were sorry but they; couldn't af¬
gamble*
We decided that we his group. If this fairly represents
ford that kind of losses.
;
should do everything in the world the attitude of union men com-

trend is not sharply reversed.

"Es¬

use

"disseminate

some

bf 47%

figures; by the way, demonstrate

on

meet "a

that to
class

a

crease

we

Adding all these other factors, but
allowing* ourselves
nothing for

Associated ; Press fadvices

sion,
from

upheld

as

tribution; nor anything for

Department action to bar second
class, mailing privileges to "Es¬
quire" Magazines Justice Douglas
delivered; the high court's 8-to-0
decision. Justice Jackson took no
verdict

in 87
did in 1941, or in
102 hours, as we did in 1942, it
took us.,128 hours.
That's an in*
Instead of building the car

include the costs of sales and

Supreme Court on
against Post Office

part in the case.

build in

1941-and $684 in 1942. cost $962in
1945- The breakdown is this:

hours,

expanding world' trade,- for free¬
dom for goods* and money to flow
where they may,. for a prosperous
world and not- a? lean world. ;

ever

which it had cost $512 to

until

and low

We really never

high that

'

trade and

been

industry; had

and

business

to

a
free,
competitive system.

•*

.

like

Company,

companies which manage to
and grow over the years
face of all the uncertainties of

other

survive

conditions

when

came-

under

Some of them*—in
attempted- a complete discussion
order to stay in business in the
of the problems of empire pref- enoughdown—because as you all. know, hope that something will happen
: erencesj:
the*' so-called
sterling
a
big mass production operation to save them—send us supplies,
bloc, the 14 billion dollar British
is economical when it is running but in a very much reduced quan¬
sterling debt and other related
at top speed,* hut it is. a mighty tity.
They still lose substantial
matters, nor to describe in, full
producing a amounts on every item they send
the provisions of the agreements expensive way of
,;
us—rbut
they ' are ./ sending
us
which ; deal with; these problems; very -small number of cars.
>,
"'
Looking at the November, 1945, fewer items to keep the, total loss
low until a solution to this whole
+
\
The U. S. Gains
cost records on-the Super Deluxe
; But
I have said
enough,. I Tudor
Ford, ? when
production problem is found.

think, to? indicate- how mistaken figures were^.comparatively low,
it is for some to say " that the we find that the total manufac¬
United States gains nothing from turing cost of: this mostv popular
these
agreements. The
specific of all Ford models added up to
British commitments to which I $962—41% more than in 1942 and
hiave> just referred* coupled with 87% more than in 1941, The car

employees

our

vacation without pay

duction

are

manage

'*

;

permit us to operate again
under the only conditions which
seem to us to promise large pro¬

Many such suppliers just cannot

;

we

would

in the same boat we are
when we sell for $728 a car which
costs us more than $1,000 without
allowing anything at all for profit,

They

a

the ; time

they couldn't help but lose money
at
the
existing
price ceilings.

so

*•

tell

could

take

it is

production of pleasure

had to halt for the

those

you

some of our suppliers,
could decide to close up shop.

we

their men.
their workers enough
them, the cost of their

hold

to

I First, like

enough to hold

to

.

reciting

am

sible choices:

If they paid

$132 to $225.

I

;

like

faced, it seemed to us, these pos¬

unable to increase their pay

are

from

facts

faced

we

which

immediately.

$304 to $343 and overhead from
Ford

•

Ford's Alternatives

suppliers, on the other
have had to reduce their
deliveries to us because they can¬
not hold their employees;
They

than

car

Motor

Ford

the

get the funds for research for bet-^
ter things and better ways of do¬

out of scarcity."

grows

As

hand,

the
1941., Direct labor costs instead
1942

the

assemble

for people to buy
have. Infla¬

the sub¬

on

its

had

Some

Well^-it took 15 more hours to

are

are

we

with the money they

bly lines^ because; of tlack! Of sup¬
plies.
Today a majority of our
assembly plants are shut down
and they will all be closed soon

Why the increase?

there

"And while

tion

pro¬

we

when

exists

Inflation

drastic proportions

up

dbllars.

are

'

•

ject of losses I would like to note,
if only for the record, that we
could not take these chances if

in

we

too few products

because of the steel
January for the first

reached

we

duction;;

a

continue to stifle
American
industry's
ability
to
produce, that is exactly in my
opinion what we are heading for.

tion, but if

unless the steel situation is cleared

!

They agree that within a year
cf the; effective date of the agree¬
in

before

here

liberty

"Nobody wants runaway infla¬

our

$512.

dollars, which they
wherever/ they choose: '

of repeating
paragraph from that telegram:

we

facturing; cost of $681 instead of

in

ment and

exhausted

the

anything; but

tell

more

even

than

car;

same

Snyder, Director of Reconversion,
and
described
the
situation in
which we found ourselves;
I take

stoppages.

shut
employees to
go
home.
This situation, inci¬
dentally, is being repeated today

—1942--represented a total manu¬

•

•

this

Now

work

was

.

do

down. and

rolling off
the assembly line 12 months later
j

agree

and

these V items

practices*;!

that from the effect¬
ive date of the agreement, United
States business jnen whor sell' to
customers in Britain can ^et their
•They

Some of them

anything because

us

Mr. John

Ten days ago I wired

supply
of essential truck parts entirely—
notably wheels and brake assem¬
blies.
When our stock pile of

$76 and overhead amounted

these restrictive trade

suppliers

our

One such strike cut off our

$304, direct' labor costs

comr

a

send

strikes

of

in

are,

problems of

of three kinds.

are

This is impor¬
at

we

briefly

this produc¬

•

financial

the

if

achieved.

The

1

fact, an the midst of a. gigantic
gamble—a gamble on the Amer¬
ican people and the future of the
free
enterprise system in this
country. ■
.
.
">
£ „
1
<
The Super Deluxe Tudor is the
most popular of our Ford cars.
In 1941, a Super Deluxe Tudor
Ford
just rolling off the- final
assembly line represented a total
manufacturing cost of $512.
It
took 87 hours to build.; Materials

other country, can relish. (

any

'

great costs

was

tant

were

in

what

tion

Eliminates Trade Wars

mark.

our

I want to indicate to you

;

opportunity to sell his wares.

\;Sooner

.

>

•

>

Value of Ford Reserves

-

v

the way.

on

or

anyone

else's. It is not go¬

ing to be achieved by recrimina¬
tions,
randa

newspaper
or

essays,

battles, memor
by

but

work.

E M. Growney

to Form
OwnFirmShorfly
E. Michael Growney
form Growney &

will shortly

Co., Inc. with of¬

fices at 37 Wall Street,

New York

.

In the second

that

suming

place, we are as¬

the; price

ceiling

problem will be solved. How big
a gamble that is, we do not really
know." •
•
■;■;!!;::>;• ;
In summary, we may lose very
■

City, to transact a general brokerdealer business

in securities. Mr.

Growney has been in the

unlisted

trading department of Bonner &

Gregory*

,

,

hard)

-..

■

Budget

system of progres-j
A balanced budget now would
rates, have to bear vir- attest the nation's determination

n&ill, under
sive

spending more

the easy course of
than we take in.

(Continued from page 833)
is that some of our citizens

fact

tax

a

the tax burden of to keep its credit standing inviothe debt and that some—not all—! late:-a continuance of deficit fiof our citizens hold the Govern- | nancing would imply that we had
mcnt securities.
It is a colossal lost our claim to integrity in fis
cal affairs.
swindle for our people to be told
all

tually

that

of

debt

not

does

any¬

mean

shall

adjusting our

be

the ' many and
problems
growing out
(floated public debt.
life

to

Necessary

Balance

Budgetary

debt is, in fact, thejmost
profound and pervasive fact of
our time.
For decades ahead we
thingf;

as

Against Inflation

Insurance

balancing the

A third reason for

economic . budget is that without it we cannot insure ourselves against in¬
difficult
flation.
Much of what we have
of our

sub¬
inflation is economically
But everyone who has cut
Budgetary Balance Necessary Be¬ naive.
his eye
cause of Dependence of Financial
teeth in: these matters
knows that the danger of inflation
Institutions on Government Credit
can be eliminated only by a
re¬
Another reason .for balancing
turn to policies of fiscal solvency,
the budget' is that such action is
so that the nation's money supply
needed to restore confidence in
will not continue to be increased
the basic fiscal integrity of our
Government. • The soundness
of by bank financed deficits, and if
production is increased so that the
our monetary and banking system
demands of the people for goods
depends on confidence in ihe Gov¬
can: be
met.
How infrequently
ernment's fiscal probity:
This is
have we heard from significant
been

hearing recently on the

ject

of

*

'

a fact of massive significance, for
two-thirds of our money supply

United States Government
and the money supply
has
expanded to nearly three
times its size when war broke out
in 1939.
Government securities

rests

ment -which

on

securities

SO % of the

represent about

now

They de¬
frequently that labor must
get this or that; but have we heard
anything more- than half-hearted
warnings from them that, if ex 7

banks, about

life in¬
surance companies of the Country.
The stability of the financial in¬
of the assets of the

stitutions

strikes, production will
and the danger of in¬
immeasurably increased?
And have we. heard from more
than a few of our Government of¬

powerless

impassioned

really

emphasize that there is

to

and not to big business

everyone,

plied criticism of the fiscal poli¬
cies of the recent past.
When the
monetary

ship on the wage-earners and the
recipients of fixed incomes." The
Government has an obligation to

cesses

these

and
speculative U ex¬
of the 20s finally culminate

people, and to the, millions
have placed their savings in

vicious de¬ who
flations of modern times, private Government Bonds, life insurance
credit
collapsed. * The
Govern¬ and savings deposits, to assure
them that their money will not be
ment then appropriately came to
the rescue by using its own credit, lost
through a decrease in • the
ed in one of the most

in

confidence

reestablish

value of the dollar.

an

structure.
Then, after, an interval of largely
misguided efforts to force recov¬
ery by pump-priming, war again
required the unstinted use of the
dangerous

Government's

During the
ficits

now

may

left

which

$100,000,000,000 of new deposits
circulating - money in the

involve * the

would

incomes

whose

means,

were

not

in

litical

force

ours.

The War and Victory Loan

society such

a

Drives represented a
to finance the

from

tained

as

non-bank

to

excess

time.

,

•;,:/;■

,/

of

used

our

fiscal

conduct.

reserves so

we

resume

but

a

debt of

the




forego

come

unnec¬

can,

by

inflation

which

would

deficits

the

budget

a

disposi¬

the maximum at¬
will inevitably fos¬

as

tainable goal
ter

or

regard mere balancing of

to

uncertainty

tive business
to

as

expansion,

business

provide

men

ac¬

It fails
with a

sound basis of confidence in the
future

on which to plan an
ex¬
pansion in their operations, and it

It may well stimulate spec¬
ulation but kill investment in the
true

of the word.

sense

Balance

and Debt Re¬

Reserve

Freedom to

size

of

the

public

debt

to

use

the traditional instruments

Reduction Necessary If

We

Are to Accumulate Reserves of

Borrowing Power for Use

on

inflationary boom, and for en¬

-I

want to

that

Government

the

that budgetary

But if in that 13-year period
military expenditures had been
$3 billions per annum instead
! of only $700 millions, we would
have invested $39 billions in the
military instead of only $9 bil-

lions.

in Later

because
reserve

to

we

of

need

build

to

borrowing

put the nation in

up

position to

a

with

cope

thing" apparently believe that the
will never again face an
emergency where/ it
will have
for

the

financial

use

of

its

strength.

reserves

is a
who
in the

This

curious thing, for the people

preach this philosophy

are

ditures.

is

be and

see

the

how they can be
programs

they

ing the bank holiday of 1933 has

road

:

:

when business

1

as

fects

public works expenditur eS
years,

:

as
of

so that they can run to,
much as $3 billions in years
bad business, and it ought
f to be clear to anyone that with
a debt of $275 billions we are
not in position to finance any
except essential public works.
'

in

believe

en¬

: 4
(3) By eliminating the super-*
f fluous, unnecessary and costly
aids to agriculture. Farming has

v

become

budgets

from
years

able

Federal Ciovern-

; area
lions

.

that

in

the

that

the

and a few hundred

mil-

ought to be
ample to finance the indispens-;
able research and the regular
costs of the Department of Ag¬
riculture, which today is greatly

f

per

annum

overmanned.

By -subjecting

(4)

govern¬

mental deoartmental cost* to a

searching investigation. With a
debt as high as that we now
have, it is time that the na¬
tion's leading management conand efficiency experts
employed by a joint Con-*
gressional and Administrative
sultants
be
:

Committee to make a

thorough-

going analysis of how Govern¬
ment costs can be cut and .Gov-*
ernmental efficiency increased.
This is no time for reshuffling
Government, agencies
or
for

;

well

or even $30 billions per
in the years ahead. Aside

fact

postwar

the

assume

and grants,
which
had
some
justification
when agriculture was prostrate,
{ should, now be continued. We
need a house-cleaning in this

necessarily must spend $20

the

to

bonuses* subsidies

At this point it is appropriate
take note of the tendency to

$25,

of the most pros¬

construct

who

•

/

our

one

industries in the counStry and it is; absurd for those/
perous

the

that

is bad they act

cushion against, the ill efof
depression^
Federal

; should be close to zero in good

few years ago.

annum

a

f

budget by curtailing
expenditures, not by holding taxes
at enterprise-breaking levels. We
must gird ourselves for
a real
fight to res st the demands of
pressure groups for increased ex¬
penditures and to
stand firm
against appeals to, spend; money
for impractical and self-defeating
programs like those so popular a

assume

business

they help to turn prosperity into a temporary boom,J
and that if they are undertaken

large-scale new investment by
private business.; The need is to

to

pros-,

is good

tax burdens represent 0
solid and impenetrable barrier to

balance

real

/

hut taxes should
probably going to be

are

to

when

undertaken

are

1

point of view
1 the President's

in

production. We

perity, that if such expenditures

present

publicized

-

but

insincere attempts

generally

to reduce ex-

penditures.With a Government
as far in debt as ours is at-the
moment, we need immediate
action ..to assure efficiency in

five

1936 to 1940, years not not¬
for the timidity with which

the Government spent money, ex¬ A
penditures averaged $8.3 billions, 4' our Government.
it is abundantly obvious that we
.(5) By liquidating the instishall need no such level as even ; tutions
of emergency credit/

billions when war-connected
expenditures - have
been com¬
pleted. I submit that the Federal
Government can limit its expen¬
ditures in the following rather

such

$20

>

obvious

ways:

,

/,:

/

7' ; y

and/ moreover, it
remembered that
they were designed as emer¬
gency " and
not as permanent
organizations. They were not
authorized to effect reforms, to
take the place of existing fi-

times

-morrow's
/

battles

row's weapons,

i

tainirig

an

with

•

i
:

tomor-

fully

mobilized and ready to engage
in global conflict at a moment's
notice.
We should be able to
f maintain a high military po?
tential, extend our system of
military education, maintain a

and

experi¬

over

such

r»v»/"*niA'fV>pv r^-occur.

.'

they

But the
time has come to instruct the
emergency corporations to
liquidate ' their present assets
may

'

laboratory

to act as
institutions,
simply to alleviate tempo¬
rary distress.
They did an es¬
sential
job and in times of
club

but

.
'

great

be /

nancial institutions or
a

instead of main-

organization

ahead

/,• should 'i

(1)' By planning military ex¬

penditures so that the country
will at all times be able to
mobilize quickly to fight to¬

•

the Reconstruction FiCorporation. They will
be
needed
in the good
as

nance

not

•

•

;

that

aids to

sure-fire

a

reduced, for everyone knows tha t

sition of; responsibility during a
period which has been marked by
a series of serious emergencies.
It
sure

as

j lie works, expenditures are/not.

-'

same

reflected!

one

should know by now that pub-

budget message,

/.

is difficult to

tified

.

colossal level of expend
This

in

those which can be jus-

; except

was

not take too much

us

sumed a

main those who have been in po-r

so

unrealistic

as

direction as were our prewar
/'policies in 'the/other, vv
j
(2) By replanning our public
works program so as to elim/ inate all Federal public works

expect balance In* the fiscal af¬
fairs of the Government only if
taxes remain
high; and he as¬

a

power so as

is

annum.

4

empha¬

could

nec¬

military expenditures of
billions or even more per

$10
.

couragement from it, for the Sec¬
retary made it clear that he would

to

Emergencies

Debt reduction is essential also

.Much of the talk of

essary

;

anyone

balance

-

military

•

was

surprise

a

ment

*

of quantitative credit control in recommend for use today will pre¬
stabilizing prosperity once it is vent emergencies when the poli¬
reached.
The
Federal
Reserve cies they recommended in the
Board is charged with the respon- past have only brought us from
ibility for holding bank credit ex- one emergency to another.; It is
pansion in check when prosperity interesting to note that the emerg¬
threatens to be transformed into ency which was proclaimed dur¬

'

quite

;

Debt

need

organizations prostrate.

makes it difficult if not impossible

lavish¬

$25 to $50 billions

must

tion

of

The

have

the deficiteer-

we

spigot of

Use Its Powers

Government's debt

is $275,000,000,000

an

eral

,

when

is

substantially

Under existing.circumstances,

ty.

to

duction Necessary to Give Fed¬

We could afford to make mistakes

,

debt

nothing less will provide a
sound basis for enduring prosperi¬

nation

we

Budgetary

ing of the '30s in the decade ahead.

with

the

reason, w$

that

leave the nation's productive and

ly that it will be very serious in¬
deed if

reduce

financial

But the

We

only to

meed mot
balance the budget but to

Another

v

1933. This is the only Way to make
that we shall not experi¬

present position de¬
mand that we return immediately
to, sound and time-tested stand¬
of fiscal

Pri¬

to Expand

future, vemergencies.
Many of those who try to convince
us that "debt does not mean any¬

our

ards

vate Enterprise Is

that

undermanned, our

"

budget in the future

attainable.

but let

Debt Reduction Necessary If

pur¬

Government

that

ence

This, therefore, is no time for
acrimonious debate as
to what
facts

were

liquid

certain

of
;,,-v:

might have been done.

'

public debt.

expenditures
balancing the
budget, stop the rapid expansion
of money supply which began in

so

total nationalincome in peace

our

we

The time has

off the

turn

essary

faced with the need for fi¬

in

of the

by incurring fur¬

power

ther deficits.

nancing war expenditures of up to
$100,000,000,000 per annum — an
materially

to the volume of

chasing

investors

reasonably
successful.
Mistakes were made,
to bp sure;. they were to be ex¬
pected when our fiscal authorities

amount

circumstances

add

and those Drives were

were

if

the

great effort

from funds ob¬

war

new money may

is

at

than

; establishment in the years preceding World
War II.
Our
average
annual
expenditures
i were only $700 millions during
the period 1925 through 1937.

Program for Balancing
the Budget

size this, for it

notice

more

It is obvious

billions.

,

A balanced

the mechan¬

short

on

;

pos¬
wartime, to consecrate itself to
sible.
It is a fine tiling for him
the defense of the price structure
to have made such a statement

risks.

not all be
spent in the near future; but while
it exists the threat to price sta¬
bility will remain. It would cer¬
tainly be asking for trouble under
This

power; the Federal Reserve
when it had, necessarily in

strong upward pressure on

a

prices.

expanded .during
the
\var,
to
liquidate their homes, insurance
and
securities, for such people
represent the great stabilizing po¬

the
lost

cannot help but fails to afford investors a reason¬
able basis > for judging business

the years to come,
exert

sential

in about

and

risk of forcing people of moderate

of

vironment is not conducive to

their heritage

probably were as severe as any¬ hands, of individuals which, if
one had any reason to expect. The
spent in addition to the current in¬
Congress rightly hesitated to levy comes received by the people in
taxes

intended

its

But they

them.

reduce

can

have

A

will; be

to the prospects
for inflation and the safety of our
financial structure. / Such an en¬

limits,for:nothing w/can do

er

War fiscal

credit./

There is

unavoidable.

were

point in debating here whether
they might have been held tolow¬

we

them,
plant

use

1

bank

continuing

Government de¬

no

not have been per¬
fect, but within the framework of
a
democratic system, tax policies

policies

war

fulfill

to

produce

war

annual cost of not

$3

i

only recently
that the Secretary of the Treasury
organization is an. es¬
said the same thing and it was an
agency
in
the modern
It is time now to restore interesting fact that it came as

world.

Inflation is vitally dangerous

an

1

weapons and
to

productive

a

;

pile easier.

reduced, the

Board

and credit. This is a ser¬
ious matter, for a powerful cen¬

money

if it is not we shall ultimately face

Gov- ; a condition where inflation will
rest. be almost inevitable? .
\

Reserve

role of stabilizer of the supply

de-

alone,. It works the greatest hard¬

to

bank holdings can be
Federal

in what I have said above no im¬

obviously

present abnormally large

that

be reduced,

any

better

free to use

so

of

isms
1

Every increase iri the public
tighten" money' rates
even
though the econotnic'situa¬ debt increases the burden of taxes
which must be - levied * to' pay in¬
tion in'general were urgently to
terest. ' Even at the low level of
call for restrictive action. '
interest;/rates now prevailng,/the
With the customary instruments
interest charge alone is nearly as
of
credit, control 'impaired the
chances of checking an inflation¬ large as' the largest tax revenues
in any year in the prewar period.
ary boom will be greatly reduced.
Under such conditions as we shall
Thus, constructive action to bal¬
face; it, is imperative that we re¬
ance
the budget and reduce the
duce expendi tures Wherever posdebt has
become imperative in
sibl e to 1 essen the tax burden, on
order.' to, restore the potency, of
investment and enterprise,; The
these Control devices.
It is not
interest savings from debt reduc¬
too much to say that without bud¬
tion, may be small but they are
getary balance, debt reduction and
not negligible, and they are cumpolicies which will encourage ndn7
bank investors to buy securities, ulative—every one makes the next

flation

ficials

a

have

ready to

•

to

powers

tral

pendent on the credit of the

me

a

cause

of

wave

ernment, which in turn must
on a sound fiscal system.
Let

demands

We shall be in

credit.

our

"know-how"

the
and

position to cope with difficult sit¬
uations as they; arise, to borrow
on favorable terms, and to borrow
without upsetting the balance of
ments, or by changes in its port¬
the economy, if we have balanced
folio of securities to reduce or ex¬
the budget and-have made sub¬
pand the ability of the banks to
stantial progress in debt reduction
make credit available. A But the
during .years of good business and
use of any of these devices inevit¬
high
national
income.
Nearly
ably has an effect on / interest
everyone
agrees
that ? once we
rates.
And, here is the rub. i As
have bridged the reconversion gap
long as the Government must bor¬
between war and peace a period
row
to meet large deficits it will
of potent;ally great prosperity lies
be fearful
of any action which
ahead.
That period should not be
might disrupt the market for its
allowed to pass without substan¬
securities, 'and the Federal Re¬
tial progress in debt reduction.
serve would, not be
its

pleas that the budget be balanced
or any really strong warning that

tioning of our economy is now

;

labor

cessive

changes in rediscount rates to
make borrowing from it more or
less expensive, and by changes in
member
bank
reserve
require¬

the func-

to

necessary

.

heart of this problem.;

50% of the total assets'of the Fed¬
eral Reserve Banks, and about
45%

even

any

clare

J^Z&rning assets of the commercial
| banks, about 65% of the earning
assets of the savings

state¬
touches
the

officials

Government

couraging credit expansion when
business is falling off.
This, the
Federal Reserve Board can do by

organization to develop

( the most powerful

It is to be

Bust

or

mental

been terminated.
hoped thgt the nation
is moving out of the phase of con¬
tinuous emergency; but it would
be foolhardy to assume that we
shall never gain have need to use

officially

never

Balance the

Thursday, February 14, 1946

CHRONICLE

THE COMMERCIAL & FINANCIAL

868

be needed

again.

.

THE COMMERCIAL & FINANCIAL CHRONICLE

4Volume 163

Number 4464

..and to

spending the pub¬ not in a position to strike out at
they are again administrative agencies, which are
always jealous of their activities

cease

The ^Freezing" Cure

lic's money until
needed,
"

(6)
.

deferring establish"cradle-to-the-grave"
Security program until

By

ment of

Social

the

a

nation

afford

cart

it.

It

ambitious for

and

since the heads

more

money,

(Continued from page 832)

of these agencies

intellectual "weight" of the pro¬
fessors
involved.
Nor
has
the

appointed by the President

were

too.

only

fair to

the coverage of old age
k

use

sideration.

due

is

to

freezing

some

the

fact

("The money is ours, but
see
it," says an old
adage.) To be sure, se¬
curity markets and commodity
prices must be frozen, too. The en¬

that

tire financial structure has to be

irra¬

procedure,

put into an ice-box, so to speak,
to accomplish the two contradic¬
tory objectives: of keeping inter¬

tional and temporary as it may be,
is the logical and inescapable se¬

quel if deficits should be contin¬
ued, cheap money rates main¬
tained, and at the same time price
inflation

•

should

be

won't

bankers'

The interest in the odd

project

it.

we

Board accepted any such plan, or
even admitted it for official con-r

With Budget making, so casual
extend
insur- a. process, it is not surprising that
ance and the range of protec¬ a budgetary balance—m those in¬
tion afforded by unemployment frequent years when it is attained
insurance
to
everyone
who —comes about mainiy by accident
It is
needs it; but the country would and not by deliberate plan.
be well advised under present time now that we plan for budget¬
fiscal conditions to resist the ary balance and, while better bud¬
pressure of the Federal Govern¬ getary coordination between the
ment for new and ambitious work of the Congressional Tax
social
programs;
Our • people and Appropriations Committees
need jobs, not more insurance. and the work of the Budget Bu-.

be

would

869

est rates

low, and avoiding at the
a run-away price infla¬

time

same

tion.

"controlled."

:

A-; ■":

would be

reau

a

a

By prohibiting the liquidation of
the bulk of bank-owned paper—

step in the

right^
be ac-'

work.

We

furthermore,

could,

with corporation income taxes of
about 20%

and levels of taxation

individual, incomes

on

consider¬

balance in the budget year

uous

Reserve's

,

vent

depressions which are not
sight..- All these panaceas
but it can be done if we are de¬
and none of
termined to get our fiscal house are self-defeating
them has worked, for depression
in order,
.•
< ■
and unemployment have continu¬
Reorganization of Budgetary
ed—Until wartime—to be our lot.
ahead.

It will not be easy,

in

even

,

t

Function Desirable

;

-

■>

The time has

come

when

have

we

The need is so pressing and the no alternative but to try a more
problem so difficult that basic conventional device — namely, a
changes in the budgetary practice return to policies, of fiscal sol¬
of the Government and in the leg- vency; and I venture to predict
islative
procedure
of Congress that if we do so we shall .enter
the; greatest periods of
may be called for. ' Our present one ;of
budgetary technique is inadquate prosperity fhi^. nation , has. eyer
in the sense that fhere ;is no experienced;'„•
1 r4y:, ■;».:..y / t
I want to end this address by
agency in either the Administra¬
tive or Legislative Divisions of the repeating
the ' statement, with
Government
which$ administers which I started it:J
,

the

budgeting function in the way

that

has

with

well. managed

become

commonplace
business or-

gahizations. In the Congress, pro¬
posed taxes are taken up »by one
.pair of committees, proposed ex¬
penditures are considered by an¬
other pair of committees; there is

r>

little coordination

of their work.

Expenditures frequently

are con¬

sidered without relation to the tax
; revenues which will be available;
taxes

are

levied with little consid¬

eration of the amounts that it is
With budget
balancing so pressing a problem,
I some means for coordinating the
: activities of the appropriation and
i proposed to spend.

taxation £ committees

the

would

<

time iO;$(daMe the budget
and reduce the debt of the Federal

Government

by a vigorous re-f
trenckment in .expenditures: that
is*.the 'categorical
imperative (of
our time.
~
t \
--'mm

II

—

y!,?

Taking Courses

signed
for
Streeters,

professional
Wall
being
rapidly

;

.

are

by veterans

Institute

the

armed

was announced

services, it

by the

of

Jan. 30.

on

Registration

thus far for February classes it is
stated

exceeds

by 10% the Fall
appear to be called for.'
Term total.
Most popular courses
The budgetary situation in the
are "Work of the Stock Exchange
Administrative side of the Gov¬
and Brokerage Office Procedure,"
ernment also leaves much to be
"Accounting Principles," and "Se¬
desired.
To be sure, there is a
curity Analysis." It is added that
Bureau of the Budget and it pre¬
the demand of experienced mar.

pares

for

the President

a

docu-

entitled

ment

analysts

kef

for

Harold

Young's

"Budget
of the
bi-weekly class in "Current De¬
States,'? which is full of
velopment in Utilities" has made
figures and about the size of the it
necessary to schedule a repeat
United

:

;
:

:

:

;

-

telephone book for

city of one
to two million people.
But that
a

report is little more than a tabulation of the expenditures which
the. agencies hope to be able to
indqce Congress, to approve and
estimate

an

of taxes

which

are

likely to be collected if there is no
change
in
existing
tax
rates.
These documents rarely give evidence o£tfby Serious note concern*
ing the need. for reducing ex¬
penditures when a deficit is anticipated.
This is not surorising
since the Bureau is part of the Of¬

session

on

following
More than
are

alternate

the

hundred

a

the

of




matter of fact, it; "neutral¬

a

izes" merely

a

standing v bond
banks

-

: and C

>

part, of the out¬
volume. * Savings
associations

are

exempt, only commercial institu¬
tions
(both member and o non-*
member banks) being covered by
the, project. Even the < latter <are
supposed to keep a substantial
.

fraction of their holdings in mar¬
ketable form, permitting its sale
to

the

central

will

find

PHILADELPHIA, PA.—Charles
Stewart Wurts, Jr. and John Wister

Wurts

have

resumed

the

vestment business of C. S.

Co.. from

offices -at

;

123

in¬

Wurts
South

completing war

rv'.Vr-v:"-

be

worth

turned

itself

on

Lazard Staff

York

City.

"over-

soon

Whatthen?

•

,

x-:

;

The outcome should be obvious.

Would-be borrowers searching for

It

undertaken.

be

may

pass.

•

a

run

the banks

on

by depositors fearing
for the
liquidity of their deposits, and by
savings bondholders on the Treas^ury.

(c)
So' far, the Treasury man¬
aged to lower interest rates with
the

aid

(called

of

the

printing

press

market operations)
policies. From here on,
major reductions can be accom¬
plished only by actually forcing
open

and other

the

banks

bonds

hold

to

at

un¬

economical

yields.
This is the
prime purpose: of the forthcom¬
ing partial "freeze." The banks
will try to recoup by grabbing at
such long-term governments and
high-grade
corporates
as
are
available, the yields of which will
then decline, too. All-round de¬
of the

cline

long-term rate from

about 2% to 1V2 % or so, and con¬

sequent rise of corporate bond
prices
(with high-grade municipals lagging behind) are therefore
a

"sure bet."

-

;

(d)
That will not stop the
lenders, of course at much higher monetary inflation caused by more
government deficits, nor the rise
rates.
In
the
place of : banks,
black markets in credit are bound of the monetary velocity through
•

would

money

find

soon

private

to pop up.

Nothing short of freez¬
ing the deposits could prevent a
man from loaning his balance to

another

man.

A

Super-Regulation

"W" might eliminate finance com¬

bank.

of

certificates

into

actual

kets

Briefly, the "sterilization" of
bank portfolios wpuld be neither
complete nor effective. It would
crack

when

the disbursement

of accumulated

corporate and private savings. On
the contrary, it will promote both.
Lower interest rates are a psycho¬
logical incentive to more deficit
financing. The relief felt by the
Treasury because a substantial
fraction of its outstanding short

.

an

;

the

to

seem

assume.

its

billions;

and the Reserve System the only

the

such

a

inflationary impact
liquidation should be

-

■

.

;■

-

*

«

replacing

effect

have

.

to

banks

one

or

way

obvious purpose

•

the

all

Laborites

inclusive.

corporations,r

The

:

competition
with the

;

of

gov¬

In addition, the

instituting^ an in¬
supervise and
market* evident¬

vestment board to

savings bonds, in particular,
should be deprived of the 60 days'
redemption privilege. Shqrt and
long term paper in. the hands of
nonfinancial

are

another.

is to eliminate, if

commercial. loans

Freezing

be

check the capital

lyfor. the same purpose of freez¬
ing it, if and when, the dispersal
of private funds should threaten
to burst the dams of the price sys¬

etc.,

would have to lose its marketabil¬

tems.

>^

ity.

And that's nof all. If people
are permitted to withdraw their
deposits from banks and liquidate

„

A

the

whole

freezing
In short,
everything has to be tied up if any
single item, should be immobil¬
ized: the American people will
have all the money in the world,
but they will not be permitted to

few

emerge

,

scheme would collapse.

.

(e)
pour

,

.

,

Skyrocketing bond prices
oil on the fire of rising stock

and real estate values.

Their ris¬

ing tide is further enhanced by
the prospect of increasing mone¬
tary volume (deficits) and higher
monetary velocity (dishoarding).
That will call for

measures

to

frol the real estate and stock

con-£
mar¬

"

J1

■

sions:

A similar result might

porarily,
be

brought about by

tax

on

given

a

a

stiff salqk

capital transactions.

But

highly inflated monetary

system, all such measures would
lead to the same result
lish

100%

.'sales tax

produced:
rise

so as

sooner

to cover

the;Epg^

on^ujuries
Ja.te^priced

or

both, the1 Capital

gain.and the tax on it. ^

Conclusions

.

the cash surrender value of their

Gfrea&iMoney pol¬

icy will be one o^the forces up¬
setting the "applecart":
it - will
contribute to the early dishoarding of the money tied up in sav¬
ings bonds, to the flooding of the
commodity
markets
by excess
purchasing power, and the infla¬
ting of prices.
'
\

a

necessary,

All-Round

redeeming

or

of

matter

a

perpetual one, at a
kets. The effect of the 100% mar¬
fantastically
low
rate,
which
leaves no profit to the banks. Nat¬ gin requirement is. virtually nil.
urally, this partial freezing has to If Mr. Eccles gets what he wants,
be supported by more
freezing the lengthening of the "grace" pe-v
measures. : Accordingly,
the Act
riod in the framework of the capi¬
nationalizing the Bank of England
tal gains tax—which is doubtful—
gives the central bank the power
to
direct the funds of the big the markets might "collapse" tem¬
in

major liquidation? With the banks

obvious.

bank de¬

"unused"

them, and providing a forced loan,

How much longer will these bond¬
holders wait before resorting to a

of

on

burden of

individuals and non-financial bus¬
iness units—amounting at present

outlet,

hands

the deposit certificates, thus re¬
lieving the government from the

Thd crucial question is, or may be
soon raised by the federal securi¬
ties in the hands of the public-

$100

It

Nazis).

posits, paying an arbitrary 1 *4%
interest, that has been reduced
the lately by usage to %%. Presently,
the avowed intention is to freeze

time

approximately

the

from

For

being at any rate,
banks are likely to hold on to.
their
portfolios
which
provide
them with badly needed earnings.

to

1

many

it

As

fact, the continuation and intensi¬
fication of the

originated there in the form of the
war-time • device y called
deposit
certificates: the Exchequer laying

project
altogether ' ignores
the
really urgent problem of "manag¬
ing the debt." The problem is not
the bank holdings, as the Reserve
authorities

.;

The British Pattern,
so

learned

typical

But the freezing

upturn.

As

bonds.

ernment

closed effectively.-

other New Dealish
tricks, the freezing concoction is
not even original. It is borrowed
from the British
(who in turn

under the strains of

come

are

(,

!

its f

working is ex¬
pected: if and when .the credit
structure, overloaded with bonds,

policies,

Harlow

to

Congress as an "economy" meas¬
ure (at the expense of the banks).
It must be limited, however, be¬
cause
any
generalized
action

Many bil¬ panies and kill all charge ac¬
might counts, but it could not stop Mr. A
purchasing from financing Mr. B's purchase
power, which is exactly what the of a house or a car. The business maturities -need not bother it any
project .was supposed to avoid. of wildcat "factors" and userers longer, is an: additional induce¬
ment to further borrowing from
Even .'the frozen part might be would flourish. As to corporations
the banks.. Borrowing from the
thawed out: the banks can sell
they would have to go to the se¬
their fixfcjd Holdings to the! Federal
curity markets
even
for 1 their banks, or rather from the Reserve
Reserve, for rediscount them, f to short-term money, and the invest¬ System, will become the more un¬
the extent that they lose deposits. ment bankers
since
lower
interest
would get the prof¬ avoidable
rates will discourage the private
its—unless they, too, are put out
Ineffective Sterilization
purchasing and holding of gov¬
of business or the security mar¬
lions

would

W.
Frank
Harlow
has
been
outlined here, see
"Prosperity: -We Can Have It If added to the staff of Lazard
We Want It," by Donald B. Wood¬ Freres & Co., 44 Wall Street, New

Murray Shields.

loaned."

As

The

Reopens in Phila.

program

ward and

turn

Stop the monetization of the debt.

*

c.sT~

pur¬
in an

is ahead of us,

as

ernment's issues.

duty, w

discussion

bank's income. .But it would! not

ff To be effective, the ' 'freezing"

get Director is appointed by the
President.
The Bureau thus is

detailed

t

the
But

and

it. is noted

registered in this class.

Broad Street, after

a

lectures.

Tuesday

fice of the President and the Bud¬

fFor

Wednesdays

bonds.

new

given the banks' practice of
keeping. "excess reserves," their
ability to lend would be exhaust¬
tion of bank portfolios would im¬
ed
pretty soon.
The customer
plylooking for a perfectly legitimate
The Leland-Seltzer concoction mortgage
loan, as an example,
would accomplish only, the first would have to go to a savings
objective: to cut substantially the bank or an association, which in

of

The basic courses of the New
Yoric Institute tOf Fmance, de^

of

industrial boom

the

over

>

the vast demand for funds

At N. Y. Inst, of Finance

filled

"control"

chase

for credit

banks; and to avoid the inflation¬
ary danger which the monetiza-

should

Veterans

a margin of 5 to
10%
expansion,
including

the

(respectively, of their de¬
positors); to "restore" the Federal

ably below those of today, have business recession* when tax re¬
It may be
receipts in years of good business ceipts will fall off.
of $16 to $20 billions or there¬ necessary at times for the Gov¬
ernment to undertake useful pub¬
abouts.
This would make it pos¬
sible to retire our debt at a rate lic works and to spend money for
But,
of $5 billions or more per annum the relief of unemployment.
Sin good years and to hold the it should be possible most of the
deficit in years of poor business time to have a budget surplus. We
to a figure not much larger than have had enough of deficits for
their own sake, deficits to prime
that, even thqugh receipts were
the pump, deficits to offset unbal¬
.reduced tand
expenditures *'.in¬
ance in savings and
investment,
creased.
>;
Let no one tell you that budget deficits aimed at maintaining pur¬
balancing is impossible in the chasing power and deficits to pre¬
years

of

expense

banks

of

periods

some

the

at

and

ury

after year is'not necessary nor to
be expected..
There will be, un¬

questionably,

one

or

..

.

(b)
Some partial and therefore
ineffective-.freezing, directed
against the banks, is most likely

would create

;!; !■■

An example may illustrate how

freezing leads to another/with
the necessity of iron logic. Sup¬
program! such as this were
alternately, by shifting that
pose the commercial banks would
volume of bonds to the Federal
adopted
Government
expendi¬ direction, little is likely to
be put under the rule of 50% bond
tures' in years of good business complished until there is a firm Reserve Banks, and
raising the re¬ holdings against their deposits, in
would
be
under
$15
billions, conviction on the part of both serve requirements for banks pro¬ addition
to, say, 20% immobilized
which would enable us to reduce arms of the Government that we portionately—the
Leland-Seltzer
ii\ legal, reserve requirements.
the tax burden to a point where must restore balance between in¬ plan
claims to' accomplish the Most of the
remaining 30% is al¬
three-fold objective: to lower the
capital could come out of the come and outgo.
Let me emphasize that contin¬ interest rate in favor of the Treas¬ ready invested in loans, leaving
storm
cellar
and
get back to
If

liquidate claims'; and hoard the
proceeds; they spenid and lend in
an
inflation.
That * spending and
lending can be controlled in an
effective fashion only by deflation;,
by reducing the monetary flood,
not by freezing it.

practical

conclusions

from the foregoing
-Ai'. •£!% ; v-Bt r:

dis.cus-

(a)/ There is just no' Way to
control money's velocity of circu¬
lation, short of

totalitarian, meth¬

ods which would

I freedom. In

a

end all economic

depression, people

On Staff of Southeastern

Securities

Corp.
Chronicle)

(Special to The Financial

JACKSONVILLE, FLA,

—

Con¬

rad M. Allen is with Southeastern

Securities

Corporation,

Adams Street

.

304 West
" :

THE

870

COMMERCIAL & FINANCIAL

A Bonus Bond to Counteract
E Bond

Redemptions

have

to

failed

to

during

do

be retired for a bonus of

Now we
what we
the war.

1937-40).
squeeze
out

in

for

200 bonds

Markets

for

300 bonds

bonds

400

bonus

of

$2,500;
ing need of rebuilding the struc¬ 2,000 bonds for a bonus of $1,000;
ture of our public debt.
^ 10,000 bonds for a bonus of $200
or
double the purchase price of
Soviet Russia did not hesitate
At the same time there is a press¬

a

of the

Whyte

has to do with

reasons

and-the

emotions

Says— |M

bonus of $10,000;

a

for

Walter

$50,000;

bonus of $20,000;

a

Thursday, February 14, 1946

As bits of abstract
philoso¬ two points; or maybe a loss.-;
phy these arguments sound Wild-eyed talk about inflation,
plausible. The trouble is that will not satisfy him; not when
plausibility and stock markets he's got losses. Nothing damp¬
have little in common.
One ens bullish
spirits so quickly

Tomorroiv's

(Continued from page 830)

pillions

CHRONICLE

other,

practical one,
praisal of the future.
more

=By WALTER WHYTE—

an

a

ap¬

I think I'll leave the latter
reason

alone.

as a

I can't foretell

reaction.

:;X* '

'

■'

-

,

'

.

p'-!

v

Last week's column called

attention

the gap - in the
between 199 and

to

industrials

Reactionary phase should
202, the averages were then
the future any better than
about 208.
Since then they
stop within 2 points or so if
will be redeemed for at least $120
you can. g But I think I know
recurrence of up trend is to
have slumped back about 200i g
or with a premium of $20. Nobody
yield as much as as $25,000,000,000
be maintained. Rail perform^ something about market emo¬ So far the dip is normal, so;
ever
"loses" and all are repaid
in American currency (125,000,tions and what makes them
with a bonus.
ance highly suspicious.
long as it doesn't * go more
000,000 rubles) in the budget of
click.
'
THIS
IS
1941 (before the war against Ger¬
NOT
A
LOTTERY
than a point or so under 198.
v":'•>'' %
# >•'
$
Inflation is the big conver¬
v
since on ALL bonds the principal
many). She invented also a quite
If it does then the next point
The main reason why peo¬
You can read
ingenious system of public bor¬ will be repaid and in addition a sation piece.
of resistance will be 194.
The
rowing which resulted in the mass premium of at least $20 will be columns
upon
columns ex¬ ple buy stocks isn't inflation.
rails which also had a small
subscription
by over 50,000,000 given to ALL bondholders. Some
plaining what this inflation is The word inflation is a handy
will
receive a
ean between 66 and 67 closed
persons in long-term government
very
substantial
and how it will affect you and excuse.
The motivating fac¬
bonds. Even during the War Rus¬ bonus, however, and this extra
it Saturday. Their action since
sia's several war loans (1942-45)
compensation, or bonus, is made your pocketbook. Among the tor is profits. Show a man a
then, however, has been bad.
yielded 87,000,000,000 rubles and possible simply by splitting the in¬ arguments, or theories about chance to make some
money
From the action of the gen?
terest among all bondholders. The
every issue was oversubscribed in
inflation that apply to the in
buying a stock and he'll eral market it doesn't look
a few days.
The secret is in the possibility of "winning" a high
market is the one that points
buy; Sometimes he may need like the reaction will
psychological device of offering bonus will be the chief attraction,
carry
a
bonuses to the subscribers.
At the and millions will subscribe.
warning finger at sellers of some urging.
In times like
the bond. All the rest of the bonds

levy throughout its existence a
heavy sales tax which used to
to

,

-

■:*

beginning of the War, in January
1942, I submited a similar plan of

The table which follows shows
the

of the drawings and
the number of bonuses paid at
each drawing.
Thus, for instance,

Bonus Bonds loan to the Secre¬

a

tary of the Treasury, Mr. Morgen-

j.

thau, but it found no response..
Now

must absorb the

the

of

lations

scription you may get a bonus
ranging from $50,000 down to $20,
according to the results of the
drawing. As soon as a bond is re¬
paid with the bonus, it is can¬

War fiscal policy: we

cur

savings accumu¬
masses and

broad

to reconvert the War Bonds

even

three months after the sub¬

even

have to undo the mis¬

we

takes of

timing

Series

celled

into

participation.

E, with their cash feature,
regular
long-term
bonds.
Only the device of a Bonus Bond
loan will entice the population
and

at

the

time

same

cheapest kind of

a

uses

loan for

mass

#the Treasury possible under the
A

lottery

.

Reserve
will
keep the
(undivided) bonds free of
charge and inform the bondholders
in case of drawing,
Although at
first glance, this plan seems to be

and simple,

pure

whole

;

N

,

as

proposed on several occasions

was

further

Federal

*

circumstances.

barred "from

Of course, all bon¬
must be free from the income

tax, be freely transferable, ac¬
ceptable as collateral, but not re¬
deemable before being drawn. The

the

mean

and

in

Congress recently, will neither
yield sufficient money, nor be a expensive to the Treasury, in real¬
fair operation since, as already ity it will cost only about 1.16%
Adam Smith observed, 'The world compound interest in
20 years,
"never saw and will never see a whereas the present Series E War
fair lottery,"
Bonds cost about 2.9%.
x
t

stocks.

It tells them that in-,

flation

that any
out
no

is

is

pressure

so

,r

reaction would bring

many new buyers that
reaction worth the name

possible.

these

Customer's

room

he

and do

It

therefore try the system

us

harm.

no

otic

No special bond

certainly

was

feeling, and

psychological

a

the

ultimately

drives will be necessary and the
whole operation may be effected

most dangerous feature of cash

through the post offices although
the banks will certainly be
willing

tion of most of the small

to cooperate.

maturity.

Under

i

.

,

-

>

demption

<

plan $10,000,000 of
bonds of $100
value, at par, will
issued on a 20-year
maturity
basis; the $100 series bonds may

must

divided
into;.; parts > of five
shares with the respective
Vs par¬

apply exceptional

in the form
ment for

of

families

years.

Thus,

<

in

of

bonds

drawn

entitled to receive

will

Now

Sale

on

nounced

recently

advices

that

had been received from Postmaster
General Robert E.
the

Hannegan that

denomination

5-cent

of

the

Roosevelt

s.

popULAR

BONUS

of

drawings
of

the

In each of

the

10

40

drawings

BOJroS

daily being made there:

His

the
and

diverting

of

money

from

advantageously exchange them for
the Bonus Bonds than by cash¬
ing before maturity.
Those for
whom the
subscription to War
Bonds

years)

2

category in 20
bonds

H

a

number

of

premeditated durable

turity and I hope that these will
majority.

zeal of cooperation and have little

bootblack

the

1

2
-

0P

2

x:

4

-x3

f'j

3

6

6

4

them

outright, and (2) all re¬
actions will be minor ones, so

The Plan is worth while

a

■a

$200

-.$120

;

9

(A)

(B)

*

In

have

6

9

1,000

9,870

20

100

1,000

29,870

II,000,

100

.

As

soon

bonuses

at

each

as

bond

300

draws

a

seen a

100

1,000

30,870

32,000

32,835,200

20

100

1,000

69,870

71,000

8,784,400

1,000

79,870

20

100

1,000

109,870

81,000
III,000

9,984,400
13,584,400

8

40

200

2,000

199,740

202,000

2,000

60

300

3,000

1,004,000

60

300

121,273,200

3,000

2,000,610

2,004,000

changed.
a

The

point

ten

60

300

3,000

2,826,610

2,830,000

2,000

man

paper

who

SUGAR

saw

profit isn't

Exports—Imports—Futures V S

gxV,

10,000

igggr/v,

: V>:

'
-

S

^-"vg'sgx

\V, •

\-'i. j'

:

''/*

V. /• gx.r"• a/v

;

•

•-

J, pip-\

■

? r""»

]} '■ gV-V

DIgby 4-2727

Pacific Coast
Established 1856

Securities
v:v;,''-yV i> N-ftSVKy

H. Hentz & Co.

203,000

The

J

$Pacific Coast Exchanges x
gv,1 ;v'vXX... *X-v-.gg;vg;;

Schwabacher & Co.
Members
New

340,393,200

drawings

are

held

every

(B) Total amount of bonuses paid in the respective period.

.

,•

.

York

New

York

Commodity

X

Chicago
'

New

Orleans
And

,

.•

I".'/".'-'

V-y5-

11

;-: Members

York

New

;

:
•

York Stock Exchange

Stock

Exchange

Curb

Exchange

cotton

Exchange
Inc.
of ? .Trade

X;.

Exchange*
Board
Cotton

other

Exchange

Exchanges

Exchange (Associate)

New York Curb

Chicago Board o/ Trade

New York 5, N. Y.

14 Wall Street
■

;;

■,xi.::;x;':?:iV'a:

.

Xf'New ^

74,666,400

9,887,000 10,000,000 $1,226,440,000

is automatically cancelled.

a ■■ ■■

.v

Teletype NY 1-928

COrtlandt 7-4150
Private Wires to
San

Francisco

Monterey

—

N. Y. Cotton Exchange
NEW

YORK 4,

Bldg.

N. Y. i

;

;

:

Principal Offices

—

Santa Barbara

Oakland
Fresno

drawing.

NEW YORK 5, N. Y.

going to feel so confident if he
sees it whittled down to just

241,273,200

It

1

99 WALL STREET

sell-off. My guess

is that if this sell-off increases

272,456,800

40,: ,X

400

we

47,812,800

200,740
1,000,610

-bonus,

They are presented as
those of the author only.]

Chronicle.

there will be a lot of minds

■

200
a

in Ms

LAMBORN & CO.

Orders Executed on
31,000

100

12

views expressed

[The

article do not necessarily at any ^
time coincide with those of the

#

few days

$63,376,000

12

AAA

* v

the past

,,

12

■a

9

'

100

200

A *

Thursday.
—Walter Whyte

'

$100 Bond

8

6

*

More next

selling in the hope of getting
them back cheaper is silly.
,

trying.

20

X

tight.

*

*

into the BorTus Bonds

20

xx V 4

fix

•4

X-''

-

4

4;XX,

see no

scheme.

20

:

I

all

are

of regular investment should

be enticed

the

than

better

paratively

,

brother-in-law, his cousin,
useful purpose in selling them
next door, the barber
here.
I would prefer to see

But .those

bought them simply in the

each

bonus.




4

'' :■

\;'. 2
3: «:
XiVX 2;X.X ■;\X 3
a;X%
:.''v 2 X •. .:X'- 3

-

quarter of the year for 20 years.
Total

.

I vx AX

X J:

3
of

years.

receive

$500

A A

•••

rest of the market.

BONDS RECEIVING A BONUS WITHIN 20 YEARS

$1,000

4

•X

3
•:

,

(in the 20th year)...

bonuses

$2,500

:'XX 3

'

78th

of

$10,000

2

1

the

number

was a

investment will keep them to ma¬

Quarter) for

$20,000

I

;

*

*
.

either
a
sharp reaction
making it hand over fist. It
through the 198 figure men¬
takes a strong man to resist
tioned: above,
or
a
rally
all this easy money.: The fact
through; the recent highs, bet
is that moneyxjs being-made
fore any positive action is rec? *
in the market, so it seems
ommended. Pending that the
doubly hard to hold back. • .. i advice is: hold

of Series E War Bonds could more

sense

LOAN—J1000 000, 000 WITH ALL
at Each
Drawing (Each
t

•X l
quar¬

3

(A)

occa¬

198,

man

>

years)

following 12
(following 3

quarterly drawing
In the 79th
quarterly drawing..
I
In the 80th (last)
quarterly drawing

All

family

Bonuses Drawn

2

Total

of present¬

the lower income
groups into sub¬
scriptions to Bonus Bonds will
have have the further
benefit of

(75th-77th)

the

means

various

on

quarterly

following 8 quarterly
drawings (following 2 years)_____
In the 61st
quarterly drawing
In the 62nd
quarterly drawing
In the 63rd
quarterly drawing
In each of the
following 11 quar¬
terly drawings (64th-74th)
In each of the
following 3 quarterly
In

the

to

anti-social gambling.
Special arrangements should be
made by which the present holders

who

$50,000

first

(first

terly drawings

of

States

curtailing

be the great

,The

"United

,

favorite

be

a

Number

each

is the wording,
Postage."

-

.

In

subscribe

sions.

bonus rang¬
In the
of 20 years 100 bonds
will

each

postage

Bonds, and they will be¬

ing gifts

_

In

will

*
.A

,-y

are

Postmaster Albert Goldman an¬

Bonus

ing from $200 to $50,000.
course

a

an¬

ready to buy. It is what to
You are still long on three
Another theory for holding buy that bothers him, and
stocks. These are Baldwin at
to long positions is that even
obliging customer's men, or
if one sold the cash would be
garrulous neighbors will glad¬ 34; stop 3 3, Flintkote at 35 Vz, •
stop 35 and Waukesha at 32Vi,
practically useless. There is ly help him out.
In the reaction of
nothing around you can use
If he doesn't spend his time stop 29.
the past few days all three
the money for.
in the broker's office he can
stocks have sold off.
But si>
still hear plenty about the
far they have held up com¬
5-Cent Roosevelt Stamp
market and the fortunes that

come a

every three months

a
designated number of these
bonds would be retired at
a call
price of at least $120, but a certain

number

measures

jof the proposed bon¬

keep the invest¬
longer time. An over¬
majority of American

whelming

twenty

we

in order to

uses

ticipation.
Every three months a
public drawing is held, or a total

drawings

the

now

great for the "small man" and

be

N

Therefore

temptation to cash the bonds be¬
fore
maturity
is
exceptionally

be

eighty

spurred subscrip¬
investors,
high rate of interest at

it looks like

now

shows he's

room

'

*

that

and not the

this

re¬

is that

other

upswing—and I'm not
hears that
referring to news. If upswing

Memorial;; Series
of
stamps, the last of four
of a Bonus Bond loan.
The plan mistake to assume thatvthe very issued honoring the late President,
proposed below is entirely my own high ultimate *2.9% interest rate Franklin Delano Roosevelt, would
composition although the general of the War Bonds would substan¬ be placed on first-day sale at
idea of it is influenced by the tially attract the man with small
Washington, on Jan. 30, the 64th
Soviet practice.
As a new experi¬ means: for anyone who may save anniversary of his birth.
The
But the crowds who are in
ment let us begin with a com¬ only some $100 or $200 a
advices also said:
The stamp will
year no
paratively small issue of $1,000,- great difference is derived from be of the special delivery size, ar¬ now are as stable as soap bub?
000,000. In case of success it may an investment at. one or two per ranged horizontally.
It will be bles in a breeze. They now
be and should be repeated.
If cent and he will find more at¬ printed by the rotary process in
have firm; convictions that
there is not sufficient response the tractive the investment in
postal blue, electric-eye perforated, and
experiment will be limited to the savings of life insurance.* It was issued in sheets of 50. Across the they won't: sell because (1)
paltry sum of one billion dollars the extraordinary drive, the patri¬ top in dark face Roman lettering they don't have to; they own
,

Let

much further from here. Fact

people around him are mak¬
doesn't, come short of
ing money* That he's in the look out for trouble.
customer's

' $

He

•

the nidging comes from
great around him.' If he sits in the

so

-

.

..

—

Sacramento
♦

-

CHICAGO

PETROIT

PITTSBURGH'

GENEVA, SWITZERLAND

-

■

-,v

•

!..

,

'•■■■■

Volume

•

•

'

"

'''

v '

<, *

"v'1'

•

>

'■

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4464

163

871

ket to the recent offering of the

of the
Republican Patty

$15,000',000 Maine Turnpike Au¬
thority 214%
revenue
bonds.
These obligations, maturing in
1976, were underwritten by an
extensive
syndicate
managed

The Obligation

Iff

(Continued from page 834)

wjhere to distort, to bore within,
wprds and terms. That pollution
has gone on apace in the United
States until many Americans think
that

Conservative is

a

ary; that

.Liberal is

a

Reaction¬

a

a

left-winger

equipped with mixed European
ideologies; and that a Progressive
is

nut.

a

.

"

■•••

.

..The Republican Party need not
time disputing over terms.
to

losophy

its

and
the

under

its

assert

phi¬

own

principles

own

and

American

term

.

resolutely defend them,
••
.What is that philosophy? It, of

that

ate

it

does

provide

climate which
initiative of

a

stimulates the proper

vestors

strengthen the mor¬
al rectitude of the people?
Does
it stiffen their self-reliance? Does
it create a climate in which right¬

men? Does it

that

the

to

of

era

Indeed, the indications are that
Treasury fiscal experts are

policy of low interest rates, rather

,

alienable rights. -But since these

liberties

fundamental
tablished

two

.

were

have

things

es¬

hap¬

pened which require new concepts
and new protections
to freedom.
The first is the In¬

of freedom

Revolution.

dustrial
is

The second

gigantic growth in area and
population.
.The Industrial Revolution, de¬
spite its fabulous gains in living
standards, threatened us with a
our

host of

new dangers to free men.
The imagination of free men had

stretched

invention

new

across

a

continent;

we had
big business.
big business undertook ex¬

Some

tra-curricular activities in special
privilege and vicious interference
in the politics of free government.
That was a new: tyranny over free

huge house-

must

we

men?

From free men comes a dy¬

namic

not

static philosophy

generate

men

of

new

ideas, new inventions. From them,
comes change, reform, and prog¬
ress.
But there can be no change

.Today
labor

gigantic growth
unions paralleling big

business.

And out of the extra¬

of

>

we see a

curricular activities of

some

CIO

uplons under radical leaders, we
have another form of special priv¬

ilege and vicious interference in
the politics of free government.
That is again tyranny.
cannot

Free

men

permit economic tyranny,

whether by capital or labor, any
more

-

than they can tolerate po¬

litical tyranny.

ITherefore,, the concept of free¬
dom

include

must

government
regulation of* economic life.
But
if men are to remain free, then
government must not dictate or
operate economic life any more
than, it may. dictate or operate

spiritual life. It must remain
pire

um¬

and mediator.

"

And

this

gigantic growth in
poulation projects
thousand problems in government,
economics, public works, health
and education.
Moreover, being
area

born

and

of

the

religiojfa^aith,

philosophy insists that ■Lm en
their brothers' keepers
T^iey

for the aged, the
destitute.. *
care

ill

our
are

must

and the.

;But if we are to maintain free
in .this gigantic population
solve

these

problems,
our
must fully embrace
the concept that man can accom

philosophy

plish

by cooperation outside
government than by coercion
from the government. < It is this
cooperation
among
free
men
more

the

of

This,

developed by Housing Expe¬
W. Wyatt and fully
endorsed
by President Truman.

The

eschews the

course,

on

command

obligations,

long-term

thereby

fOf considerable dimensions. The
of

development

this

however,

measured by

the de¬

regarded

circumstances, the pos¬

agreements. Reaction is foreign to
it, for its motive and inspiration
to
explore the illimitable
means by which men can enrich
the civilization to which they be¬
long. It: is liberalism in the true
meaning of- expanding freedom of
men.
It is conservatism in that it
would conserve the freedoms we
have

Republican Party owes it to

The

they
did against slavery in 1860 under
selves flatly on this issue as

entertained among some, in¬

course

field

they would, not declare for free
men rather: than for the world?
wide reaction today toward eco¬
nomic serfdom.

dangers to freedom do not
lie wholly in our domestic life,,
The

they lie also in our attitudes to¬
ward freedom in the world today.
Freedom has .shrunk in the world
of

result

a

of

born

our-

owri policies

our

tries

tending

small

the

aligned to public interest that re¬
leases the energies of the people
for

and

abundant production. The tens of
thousands of community commit-

The history of

overcome.

ization shows that in many a

the

solutions

or

all .the

Will wither

on

the vine.

forces, which lie

experience

heart. It

ican

was

tion

can

are

fields where coopera¬

men

be properly aided by gov¬

deep in the hu¬

and

the human

such steadfast Amer¬

RAILWAY COMPANY
Preferred Stock Dividend
A

dividend

Stock

of

this

of

March

holders

62Vic

share

a

of

meeting of the Board of Directors

of

men

payable

1946,
to
stock¬
record at the close of

March

14,

1946.

the.

PARSONS,

War.

dens

the

and

becomes

the

enemy „ot

the




gov¬

confusions

of

war

in

coln's time.

Have

we

also

Stock (free of income tax)
payable on the 30th March 1946.
order

to

dividends

these

obtain

held

be

and

on

the

on

18th

being
Meet¬

February

after
the 30 th March
Stock Warrants must

be made. /

will

dividends

;

against

paid

be

Coupon/only, namely,.
,

Stock Warrants to Bearer
exchanged Talon No.. 3
for
Talon; No.
4
but have
deposited
Talon No. 3 with
the Guaranty Trust
Company of New York in New York, in
accordance with the arrangement which
has
been announced in the Press, are
notified
that
Coupon No. 197 .will be
detached from the corresponding Talon
No. 4 and cancelled by the Company in
London as
and when the dividends to
which they are entitled are paid.
y1,:
have

not

1$46

half-yearly dividend of 2Vz %
Preference Stock (less Income

The usual

the 5%

on

•.;■

Coupon No. 85' must be deposited with ::
National
Provincial Bank Limited,

the

Savoy

C., for

Court, Strand, London, W.

(expayment is

examination five clear business days

before

Saturday)

eluding

RICHARD ROLLINS

E. G. LANGFORD, Secretary.

,

Rusham House, Egham, Surrey.

'

Secretary

COLUMBIAN
PIPE LINE

CARBON COMPANY

COMPANY

of Directors of this Company has
declared a dividend of Twenty (20)
Cents
per
share on
the
outstanding
capital
stock, payable March 15, 1946 to shareholders
of
record
at
the close of
business
February

:

A

.

C. O. BELL, Secretary.

.

Lin¬

GEORGE L. BUBB

J.

I.

Case

Treasurer

Company

(Incorporated)

Racine, Wis., February 6, 1946.
of $1.75 per share upon the out¬
standing Preferred Stock of this Company has
been
declared
payable April 1, 1946,
and a
dividend of 40c per share upon the outstanding
$25 par value Common Stock of this Company
has
been
declared
payable April 1, 1946, to
of

March. 12,

at

record

the

of

close

GAS

less faith?

I Dollar

PETERS,

ELECTRIC

business

The
B.

&

Secretary.

declared, this day

Board

of

Directors

the. following

has

dividend:

Common. Stock.

TEXAS GULF SULPHUR COMPANY
Board

of

Directors

stock,

February

of

15,
H.

payable
record

March

payable

declared

has

dividend of 50 cents per share on the

15,

a

1946.

to

at the close of business

1946.
F.

J.

KNOBLOCH,

on

Treasurer.

share

April 4, 1946, to holders of

record at close of

company's

business March

Three-quarter

and

outstanding in the
declared opt
the company,
for the quarter ending March 31/ -1946,
payable April, 1, 1946, to holders, of
such stock of record on the books of the
company, at the close of business March-,
issued

and

hands of the public has been
of. the surplus net earnings of

'.'v.;

:

;

,

.

^
*

THE regular quarterly dividend of
I Forty Cents (40c)

per

share

on

the

Common capital stock of the company is¬

hands of the
public has.been declared out of the surplus,
net earnings of the company for the quarter
ending March 31, 1946, payable March
15, 1946, to holders of such'stock of
sued and-outstanding in the

the books of the company at
the close of business February 20, 1946.
record

on

9, 1946.

Dale Parker

February 7, 1946

Eighteen

fomiuoaStoch Dividend

CORPORATION

No. 44, 10£ per

capital

THE regular quarterly dividend of One-

company

COLUMBIA

1946.
WM.

The

■

8,1946.

dividend

holders

^

Cents ($1.18$*) per share on the 4$*%'
cumulative Preferred, capital stock of. the

•

••

A

-

.

Preferred Stock Dividend

The, Director# ofi Columbian* Carbon
Company have declared a regular
quarterly dividend of thirty-five cents
($.35) per share, payable March 11,
1946, to stockholders of record Febru¬
ary 25,1946, at 3 P. M.
%

stockholders

any

U—

Quarterly Dividend

Board

day

1946.

21,

AMERICAN GAS
ANII ELKCTlllC COMPANY

Ninety-Seventh Consecutive

30 Broad Street

New York, N. Y., January 31, 1946.

;
The

this

».

DATED the 16th day of January, 1946. ,
BY ORDER OF THE BOARD
v

1946. Checks will be mailed.

THE BUCKEYE

•

Tax) for the year ending 30th September
next
will also be payable on the 30th

March 1946.{

Chicago, Illinois, February 5,

Revolutionary

Again such groups stood
firm and brought freedom through

above
apart from the governed.
It

Checks

Secretary

through the

ernment, but government swollen
with power and laden with bur¬

becomes., something

of Ordi¬

tember 1946 of tenpence per £1

29,

B. F.

February 4, 1946, a dividend of
thirty-seven and one-half cents (37%c)
per share was declared on the Common
Stock of the Company, payable March
15, 1946, to stockholders of record
at the close of business February 21,

has

Preferred

Corporation,

be mailed.

held

and women who. carried

the torch of free

confusions

the

on

/- Holders, of

'

/There

dividend

interim

holders of Ordinary

will

■

yet if they stood firm until
had passed, they won.
And to them rallied the spiritual
furies

man

first

1st

deposit Coupon No. 197 with the Guar¬
anty Trust Company of New York, 11
Birchin
Dane,
London, E. C. 3, seven
clear business days (excluding Saturday)

business

an¬

swers,

the

the

a

Ordinary Stock for the year from,
October 1945 to the 30th Sep--»

issued

who

162

•

tees,local
governments,
labor
unions, commercial associations,
farm organizations and our host
} of other free institutions can do
a; million services
in the public
interest every year which Statism

1945

Stock

to
next),

on

firmior their principles and
beliefs. They may not have known
all

Stock

ing

of

NUMBER

DIVIDEND

have

Report

the
Stockholders the
#Oth March 1946 of, a
on
the issued Ordinary
for the year ended 30th September
of sevenpence per £1
of Ordinary
(free
of income tax)
and have
to

payment on the
Final Dividend

thq deposit of one
Coupon No. 197.

error,

achievement

be

Annual

their

in

recommended

(subject to the
Final Dividend
sanctioned at the Annual General

limit

supply

COMMON

February 4,1946

Hereby given that the

is

notice
Directors

nary

mar-

DIVIDEND NOTICES

been declared on the 5%

a

HOLDERS
TO BEARER FOR
ORDINARY AND PREFERENCE STOCK.
C

NOTICE OF DIVIDENDS TO

Both

THE ATLANTIC REFINING CO.

practices of free

the confusions and

are

of

of

reaction

CHICAGO GREAT WESTERN

At

BRITISH-AMERICAN
TOBACCO COMPANY LIMITED

before payment can

further

to

DIVIDEND NOTICES

In

DIVIDEND NOTICES

,,•

as

and

indus-

With strikes in major

mem

Great

tenor

municipal bond:

the

'

in

the concepts and

difficulties

the

the

ply for a much longer period than

America- alone
the- chance to preserve

remains

of

of

had been expected.

the % already

Witter & Co.

declared

was

toward

drift

own

Here

Statism.

investment

an

mounting level of municipal

I have no fear that

Lincoln.

Mr.

from

Indicative

won.

the American people to give them
the opportunity to express them¬

a

standpoint.

vestors, of an impending halt to
the

of

whose obligations are now highly

sibility (or hope) that at one time
was

the possibility

is

Gil¬

OF STOCK WARRANTS

ing by local housing authorities,

mand, for Treasury bonds.
In these

v

resumption of long-term financ¬

higher prices for the small sup¬

are

day, they can
civil¬
crisis
and time of confusion some men
and
women
stood solid against

creative

be severely limited,

I Implicit in the housing scheme,

is;

daily evident in the increasingly

ply^ as

pur¬

both private and municipal,

poses,

Goodwin,

Montgomery Street. Mr.

com¬

plies for other construction

may

effect

of Walston, Hoffman &

pletion, with the result that sup¬

giving comparable outstanding
instruments a "scarcity" value

CALIF.—

Philip D.
Piltz have been added to the staff

John

of

materials heeded for its

Chronicle)

The "Financial

FRANCISCO,
J. Gillespie and

SAN

contemplates the
a
high priority

program

establishment

any material vol¬
relatively high coupon

of

(Special to

prospects of

pnly a nation rooted in this phi¬ bond prices has been largely dis¬
losophy that can be a sanctuary carded. In addition, there is. the
for the oppressed, the protector of
realizatioirv that thejvvolume oi
the exploited; the calm tribunal
local government securities wil
before which men may articulate
their differences and perfect their necessarily continue in short sup¬

as

*

njen
and

built.on these founds

tions and imdefiled by special in¬

by moral
force the confidence of all. > It is

CIO Unions

With Walston, 'Hoffman

such

have a
constructive program.. What more
constructive program is there in
the world today than that of free

;

forces.

armed

and

ume

can

the

in

serving

after

lespie was previously with Dean

terest

-

North

314

Inc.,

Company,

and

ing belief that the monetary au¬
thorities are wedded to the theory

possibility of

A society

&

with Stifel, Nicolaus

now

Broadway,

W.

MO.~John

265

utilities and corporations.

outmoded

Bunn is

Chronicle)

Financial

diter Wilson

free men
laissez-faire was
first, fought out in the anti-trust
acts; and the public regulation ef

That battle for

from

ex¬

The latest

the

,

ernment.

Free

the

to

The

gram

a

cleaning of $tatism from our Gov¬

life;

relation

in

to

LOUIS,

refunding
operations now im¬
pending be effected almost ex¬
clusively on a temporary basis.

tests would mean a

a

(Special

ST.

ernment dictate that the extensive

philosophy

told

Rejoins Stifel, Nicolaus

monetary

future

energies

judgments,
their
their cooperation.

are

currently

are

that the best interests of the gov¬

dermine their morals, their
reliance, their confidence,

We

they

selftheir

by Statism it strangles them
with uncertainties, fears and in¬
tellectual dishonesties which un¬
But

in the .principles of free men or
there will be no progress.

men.'

extension of past

reversal of the trend.
This is evidenced in the growl¬

than to

*

<

a

that

blow, incidentally, to
an early imple¬
mentation of the new projects and
improvements long envisaged by
municipal officials was contained
in the large-scale dwelling pro¬

be found,

Such

the bonds, with the re¬

quoted at 102.10214.

panding demand, a consideration
that is being currently reflected
in the mounting price structure.'

the

an

of

vestments

■

committed to

much greater evalua¬

a

on

sult

However, this will not material¬
ly alleviate the shortage of in¬

conditions is far from im¬
minent.
■
' *» ' '
' V

tive answers, to our

to

placed
tion

be
in antici¬

offerings made

some

easy

such tests the right

fidelity

market,

al¬

financing,

Co., and offered to
price of 49.50. The
however,
speedily

a

though there will probably
pation

the

includes

investors at

needs.

concepts underlying the I)eclaratibm of Independence and the
Constitution: with its bill of urn

.cqurse,

incidental

in¬

end

and

the

reconciled to the fact

are

an

dealers

both

and Tripp &

post¬

the

of

improvement programs of
local governments will remain
in the blue-print stage for an
indefinite period.
Necessarily,
this will act as a deterrent to

money

cooperation can thrive? With
and construc¬
problems will

eous

that

part

large

a

war

.

size

jointly by Stifel, Nicolaus & Co.,

basic materials, the chances are

With the

fully taxable corpor¬
obligations selling at record
low yields, and all types of Treas¬
To
delineate
the
appropriate ury securities, establishing new
boundaries
of
the
Government highs almost daily, it is hardly
which preserve such a philosophy necessary to search for the reasons
and principles is the task of .the .underlying the present "bull mar¬
statesmanship for which his coiih- ket in the tax-exempt municipals.
try'is waiting.v ,
y/jV
- The performance of these other
One test of Government is* — markets merely serves to empha¬

w.aste

It" needs

'

prerogatives

increasing its
with fanatical zeal.

erned

Secretary

H. D. ANDERSON, Secretary.

February 13, 1946.

_

372

THE COMMERCIAL

& FINANCIAL CHRONICLE

from misery and

Business and Politics
(Continued from

their

835)

page

sincerity

own

ability to lead!

J ;i You will remember his famous
"slogan, "Equal rights for all, spe¬

their

or

'

•

own

country

Nowhere ; has i this practice of
none." During appeasement been carried to a
the past 12 years the greatest in¬ greater point than in the use of
radios Here again the advertising
jury to our industrial system has
been brought about by a new use fraternity must carry a high deof the Taxing Power. Instead of gree of responsibility. Too often,
in this very critical period
through
taxing
our people
for revenue
which the nation is passing, prin¬
only, we have seen the revenue
ciples have been suborned for an
department used as an active incial

privilege

,

be

to

.

the

burdens

borne

of

perceive

only by the

politi-1 opinion
t

and

child

in

the

The

pays

the

price of
ticle he
For

:

your

f

ultimate

corporation
every

torting

the

personal

of

their

names

in

•

busily

the
ar¬

-

the

price

«:

well

as

I

whenever

in

you

can

buy

a

new

auto-

vertising agencies or
executives

and

you

]

consumers in this country.
higher taxes go,"the higher
will go prices, and the lower our

go.

j
Thus,!

ad¬

I

earnings, is to weaken
and make it incapable of

hands, despondent and dis¬
couraged, and say that business
must go with," and not try to op¬
this rising tide. They do not

|

CIO

has

—

toward

or*

so¬

toward totalitarianism—

as

face

the

ward

of

great,

a

CIO,,

"

!

two

or

alliance.

In

bills

there

reflects

of

every; one

is

all-

erans

themselves liberals.

In

'

VNote what the CIO says;

tast decade,this write persuasive
to theme. By and
copy"
on

[large, these

efforts haye not

meas-]

4The issue is joined between two
distinct
political
philosophies—

Thp pub-

j

|ic has remained highly skeptical !

this

add

up

,

'

to? ''

Is there any doubt of the direc";

i

tion in which

they point?

v.j

-

.

"

They

the

express

same

contempt;
business classes, for the

the

?

capitalistic system, that has led to
the

"Nationalization"

not

only in

of industry
England but in vir- ; 4
tually every liberated couptry in
Europe.
.'• •
;::;

•The

Challenge Must Be Met 4

Here is
be

can

direct challenge that

a

evaded

•

longer. It must 4;

no

be met—not by appeasement—not

with

dependents; to liberal¬
provisions; and to liberal¬

by

,,

4<"We

reliance

sure

condemn all attempts to
divert the veterans from their real

legal

upon

;|

defense

labor

movement

and

using

them to undermine collective bar¬

tions must make

gaining,

.

there

wages and

emergency measure

working stand-

be

can

sutrender

a

decisive

further

no

of

chofed';

retredf'br

principles that Ajre
fundamental to the preservatioh
of our form' of government ahd
the rights and liberties of the in¬

The CIO says:

be

"

dividual citizen! That, choice must

"Passage of this bill would de¬

to bring benefits up to the level
long recommended by the Social
Security Board. Opposition to it

vj

very
framework of govern- 4
ment itself! Those who believe in :;
America
and
American • institii- :

rights by playing them off against
the

operating from within

groups

the

made

now

because I agree

at

least this much with these radical

stroy the National Labor Relations

it's later, much later,' thaii

groups:

it

think!

you

.
,

;

The first problem that requires
decisive action is to correct at
once

increasingly serious de¬
political machinery.^

an

fect

in

This

.

•

y

,

v

ments; what do they

new

call

; :

.

'

Take the legislative program of
the CIO and these various state-

to

has. been based on a fear that it Act and the democratic principles
worship of absolutism—:
will make workers unwilling to of free collective • bargaining. Tt
communism, socialism, or
would enable reactionary employ¬
jeven
when great business and, what you will—and that simple, accept jobs at less than $25 a
ers
to tie workers' organizations
old-fashioned Jeffersonian type of week. This open intention to cut
[trade associations have sought to
up in endless litigation and para¬
win popular
democracy under which I grew up wages to substandard levels is a
followings for slo-j
drastic attack on the : American lyze their efforts for better wages
:gans like "What's good for busi- and in which millions of Ameri¬
and working conditions."
standard of living."
cans still believe,
•
>
pess is good for you!" .
Now these measures; all except
(£) Full Employment Bill.(MurOne
group
would
jf Why was it that inibis,. the
place the ray-Patman
Bill, S. 380, jHj R. the last one, President Truman
jmost vital of all
assignrhents, busi-1 management of the national econ¬
is actively supporting. They; fall
-vh'c
jdess did not. succeed? Was it that omy in the hands of bureaucrats 2202).within the power-politics program
The CIO says:
the problem had been
'
rather than in the hands of skilled
only super-!
of the militant CIO-PAC organi¬
"The right to a good job was a
ficially studied or that causes of technicians. One would "national¬
zation headed up by Sidney Hillpopular economic discontent had ize" industry and finance and seek key plank in the Roosevelt plat¬
man. They constitute some of the
to divide rather than create new
not been properly analyzed?
form. To establish that
There
right is a basic issues of the 1946-1948 cam¬
[was-—and there, still is—a strong wealth. The choice is between mandate of the people through
paign, for which the preliminary
base to be made for the
men who talk and the
the overwhelming
men who
business
victory Roose¬ skirmishes are now under
way.
act."
velt won in 1944.
point of view—to be made, if
The Murrayyou;
1
The nation has thus been put on
Patman bill makes this right a
please, for. sane and experienced\ v Do not misunderstand
me; I be¬
hotice as to the economic objec¬
guidance of our national affairs as lieve that the politician has a
government policy. There is no
very
tives which are being pursued by
ftgainst irresponsible promises
by] .important role to play in Ameri¬ question df taking the initiative these radical groups. That these
demagogues seeking to capitalize can life. Our job is to
away from private industry. There
keep him
objectives go far beyond the ordi¬
bn popular dissatisfactions. ;
is simply a method of planning
in his rightful
7.
place—not to per¬
nary "demands" of labor in col¬
mit
ahead to meet, by means of worthy
him to become
iritoxicated,
lective bargaining procedures has
Business Leadership Defective
with
tired up to expectations.

necessary for a

,

•

an

Their

over.

world. Let us admit that it
be born only of a new social

order.".

r,

constitutes

ceased to count. The day

philosophy is

can

.

country, during the,
Two Distinct Political Philosophies

world of Russia has the busi¬

cial
new

.

in the

■/

.

thought is bankrupt, their ethical
are
obsolete, their dogmas M
an angry anachronism. A new so-

;;4| ;
system,1-Wfe must 'admit that the every country thfe trend is toward
the
"President Truman's, program
Results have bfen somewhat dis-j ment aggrandizement of govern-* for Federal, funds to
and giving the bureaucrat
t^7) Ball-Burton-Hatch Bill (S.
supplement
Appointing., Many. attempts have ; unlimited power.""
state unemployment compensation 1171).
■:
""
\
^ >,
[been made by the best advertising :
'brains

i

.

mechanisms, but by courageous
ize several other' provisions. We resistance to the further
aggranalsq support's' gerfei'6'us 'bonus' dr dizementof the power of Big Gov-.;
adjusted service compensation. ; : ernment—to the power of pres¬

,

call

and H

values

Rights" are only triv¬
improvements. The law must

ize loan

socialism
mean peace

of the middle class is

sen¬

amended

no

significant that only in the

nessman

provide $25 per
week
unemployment compensa¬
tion, with $5 additional for vet¬

.

,

do not reflect the

be

worthy objective
and it is stated in language with
which no one can disagree.

is

for

ial

a

Free
econ¬

new

to

"GI Bill of

these

middle way.

It

timents of the nation. The Rankin
amendments (H. R. 3749) to the

deeper

some

war

Said Mr. Laski:

omy;; mean war;
planned economy

; 1

"The niggardly benefits so far
provided by Congress for Veterans
of this

Party, Harold Laski,

enterprise and the market

J,

Note

consequences.

J

City:

1

of

•

speaking

on
a
recent visit to the United
States when he spoke with
Sidney
Hillman and others in New York

"There is

,

leader

!

British Labor

The CIO says:

pass

socialist

about the same time that Mr. :
Reuther spoke. This new declara- *
tion came from the head of the

guarantee American citizens their

..

who

was

-

| "Two Congresses have failed

;

many
convincing
I quote from a CIO
powerful Welfare State which will
pamphlet
demonstrations of the power .of
'undertake to guarantee him a job
which lists these
bills^;/together
advertising when it is applied as
as v^ell as his future economic se¬
with
the
,an economic or social force. The
j. CIO,: explanation
for
them.
\
'•
curity. Those rights of the
[facts seem to be exactly the re-,' vidual, which our ancestors indi¬
(1) Unemployment compensa¬
fought
[verse when advertising is em¬
for so bitterly during the 18th and tion of $25 (maximum) per week
ployed in the political sphere.]
19th centuries, are today
When
suspect up to 26 weeks (Kilgore-Forand
it
comes
to
selling the
and under attack by the
Bill, S. 1274, H/R. 3891),
very men

[American people on the benefits
land virtues bf 'bur free enterprise

Abolition

enterprise ' i
battling for its very life f
also made definitely clear
by V

at

The CIO says:

draw your own conclusions
to whether this is merely a co¬

incidence

This John Q. Public is to be¬

The

legislation."

(has passed House).

now

may

which it is foolish to

come

this

strikes

now

another

fas¬

poll tax for
voting in Federal elections (H.R.

ported by the Administration. You

world-wide drift

a

own.

are

are

in

perform-j

Political Advertising

that

demanding that the Congress

;

$ There

bills

on

4(5)

also that practically every one of
these bills is being actively sup¬

cialism

of

responsibility.
Congressmen must sign discharge
to have opportunity to

of which the CIO-PAC
groups are

oppose. More
;|ng its true function of creating'
and
more,
lip service is beingjimore and more jobs in an evergiven to the "Common, man"' who
expanding economy!
4
\
4
is now seen as coming into his
£•'
/»
;?;4-Vv,^.
■ivV-.-rv
\-; v.

in

They think that America is caught

industry

earmarks

'

think that any kind of
advertising
to drain off into the hands of gov-;
ernment through excessive taxa-l approach will solve the problem.

tion any arbitrarily set portion of

the

is

petition
vote

intent

nation-wide

of
returning veterans and seriously
threaten the entire 1946 reconver¬
sion program. That free

manent government

patterns

4

con-

revolutionary

the

industries, retard employment

objectives
elementary
democratic
rights,
are
clearly
defined.
It without the full Senate
ever hav¬
seeks, first, through industry-wide
ing a chance to vote on the issue.
strikes, particularly in the fields Poll tax
politics and poll tax Con¬
of transportation and communica¬
gressmen are a stumbling block
tion, to accustom CIO unions to
to every bill in the people's in¬
the use of mass power, and, sec¬
terest. Senators this year must re¬
ond, through employing pressure fuse to
tolerate diversion, delay
politics at the capital, to teach
and filibuster which frustrate the
forcibly that members of Congress
Will of the majority of the Sen^
are
dependent upon the voting
ate."
•
*
strength of labor, its political al¬
(6) Generous treatment of re¬
lies, and its friends.,,
e
Here is a list of seven bills, six turning veterans. *

" There are many who throw up

pose,

that

strikes

iOv

which now paralyze the
country's

which

their

million

assert

CIO

economic

new

Objectives of

to¬

.

of

deliberately designed to

into

The

aiding
these- detractors of

44

to

as

wave

the

behind

Organized labor cannot tol¬
erate ;the. reestablishment
of
a
group of low-wage workers who
can be used to pull down all labor
standards.
Non-discrimination in
employment must be made a per¬

pending before Congress,

are

American business!

The

4 standard of living will

abetting

far

so

corporated

do—all

our own

of

one

Behind

statement, I submit,

fesses

cism.

literature that has been published.
Many of these proposals are in¬

own

get

we

That

4:44

are

will be found in much of the CIO

in

of

labor, materials, overhead,
and, last but not least, taxes, and
the
same
thing holds true for
every other purchase made by 135

;

name

their

go

present

ica

deliberately dis¬
for

than the de¬

a postwar depression.
Plans for the rebuilding of Amer¬

tearing down
the business system which gives
them their jobs. Too many busi¬

cost of

|

as

engaged

mobile—there will be included the vertising

j

4

will

products

•.

4|

a

more severe

has been

gain —and abusing the
free speech. You know

right

nessmen,

in

I

are

facts

postwar depression.

bring about

gether, are "viewing with alarm"
automobile—when, "as,1 while, at the same time, our ad¬

new

4 and if

tax

-

-

instance,

even

the

their

believes

consumer

manufactured

buys.

enterprise

a.dozen who

fallacy to say that corpo¬
rations "pay" taxes;—they do not
—they collect taxes from the peo¬
ple and transmit them to the Gov¬
a

ernment.

conscientiously

free

whose

,

their

provide

H. R. 2232).••

of a new Socialist Welfare
State. Some well-informed people

checks. For everyone of those

pay

who

United States.
It is

who

,

are

vent

are

businessmen

the
is the greatest crime against every'
woman

much

frankly contemptuous
condescending
toward
the

and

agriculture

Intent

Strikes

va-1

should buy."
(4)
Permanent Fair Employ¬
ment Practices Committee (S.
101,

pression of the '30s that the Amer¬
ican public will welcome the ad¬

are' stand on these vital issues. Most
rich. It of these artful molders of public

taxes
corporations—and here

man,

take

sizable

Revolutionary

these workers

con¬

Our radical friends

malnutrition, and

prosperity of business

The CIO says: f
V4'i. ^;4;d:4:
postwar de¬ 1 "As
manpower shortage is re¬
pression is necessary^ This eco¬
placed by growing unemployment,
nomic collapse—so these
prophets many employers are
reverting to
say—will be so far-reaching and
racist personnel practices which
so

taxation

has become popular in the
cian's belief, to levy high
upon

where; they

is turning

I do not believe

;

opportunism. One has only to
listen to many of these so-called
"Commentators'' over the air to

We have been taught to believe

that

first

easy

Who Pays the Taxes?

and,

biding their time. They expect to
triumph with the arrival of the

for

•strument of social reform.

also for the

once more

servative.

'

i

Thursday, February 14, 1946

means

our

that like-minded

men

v

must

.

join hands and make

'

nion cause

„

■

influences

com-

against the. subversive
at work in Amer-

now

4

,

.

ica. Just

the effort is

as

now being
made, under the auspices of the

.

;

■

CIO-PAC groups, to organize all V4;
minority and dissident factions ,4
into.,;: one dominant self-interest ;
bloc, so the time has come when f-v:v
imaginary
'differences
between

'

his; new-found

4

But

against

the

"smear"

cam¬

paigns

waged by the radicals—
Who falsply call themselves lib¬

erals and progressives

business

leadership, has been ' ineffective;
foo frequently it has either abdipated

or sought to play a gbme
appeasement with its critics.
Our business
leaders, remember¬

qf

start

power

messing around in

and

economic

affairs which he will
never, never

understand.!.

4; :\-4 4. vent."

We ought to look
carefully at
the blueprints for this totalitarian
state which is now
being prepared
for America.,, These
plans
date

to their< prede¬

'




W (3)

-

65c

Minimum Wage

per-Thomas
3914).
The CIO

back to'before the war;

they were
greatly accelerated by that con¬
flict, and right now they are being
cessors after the economic
collapse pushed- ahead for early application
pt 1929, are often too timid or so. in the postwar period. Don't be
lacking in faith in their own lulled into believing that Mr. Tru¬
*'case" that they fail to convince1
man
has "fired" all Mr."Roose¬
le
American
public either of velt's radical advisers or that the

ing what happened

public works, the gaps which the
past three decades have shown
private industry alone cannot pre¬

Bill,

S.

1349,

(Pep¬

H.

'

.

,v

'4

per

hour

im¬

a

Only thus

ness

which
so

Walter

Reuther, who leads the
stride against General Motors,
Referring

to

that

conflict

and

its significance, Reuther declared:

issue

is

bigger

than

an

argument—bigger

than the corporation—bigger than
the union. The current issue
.

is

the *

after transcends the narrow economic
two years respectively,,
interest of labor and management

indispensable
purchasing
power
standards.

It

floor under
and

living

is necessary for the

protection of millions of workers

and

.

.

.

gets to the very heart of

the basic economic problem facing
this nation."

/

be

resolved in

cause.-'4/.'4.^4
can

remedy the

we

existing weakness within the, two
major political parties—a weakr

If

the

pressure

groups

skillfully exploi^d!

,,

4;

Political Action i€ommittee
for the Left is justifiedjto stronga

arm

Congress. intO

accePting -a
like that of the CIO, then

program
a

Political

Action

Committee for

the Right, which will actively op¬
pose

force

with

force, is

justifiable.

mediately, and 70c and 75c
a year and

should

,

common

have

ordinary, wage

"This measure,
raising minimum

legal wages to 65c

progressive Republi¬
forthright, progressive

likewise been admitted by one of

"This
says:

and

cans

Democrats

the CIO's most influential leaders,

•

R.

forthright,

1

less

no

;

Let's utilize the pattern adopted

by' Mr:

Hillman's

followers

and

organize every village, and every
city to counter these threats to
true

Cratic
.'

V.

representative

and

demor

government; In this way I
■

•••

;

"

•

•

4- ^

■

••

j>"■

4v V?r

.Volume 163

THE COMMERCIAL & FINANCIAL

Number 4464

CHRONICLE

instead of temporary.

u'i:-

is

(Continued: from page 834)
vsions on matters of the gravest
import to the American people. .

On

T;

-'
.

mental

question of national policy

'

involved,

is in line with what Byrnes tried

the Coun¬
of Ministers in London. But at

to do last September at
cil

.

Issue

.

Political One

a

issue is

believe the

I

the
UNO charter and the obligations

,

primarily

-

one

our

Just

f

judgments are perilous. The dan¬
ger is that they deprive the Sen¬
ate and the American people from
considered
decisions on
foreign

policies acording to

.

life." Pulling no

sia

or

pointed • rferences to the
"typically fascist" government in
this hemisphere; compared its al¬
leged threat to peace with that
of Nazi Germany; and argued that
the Good Neighbor policy must
not be construed as meaning tol¬
erance for an American republic

right here that

much afraid of Rus¬
of Russia's purposes as a
as

■

good many are.
rJ. iWe are dealing

there with a

which is governed by such a dic¬

strong people who have long been
repressed in many directions by
the outside world, and who now,

•

r
.•

,

different

in

hand

the

and

countries.

The

world.\President

ica's

world, mystified by Amer¬
inconsistent

foreign;,;policy

being

.

77,"

kind.

7 '

_

"•

7."■■

•

EquilibriUik

Must Work for AVorld

attempt^to

'Therefore, we must
work

out

equilib¬

stable world

a

rium. In order to do

that, Britain's

potency must be maintained, one
way or another.
•• *
.»
We

of

forces

the other to
dominate our foreign policies. We
have built a roof without laying
the foundation that is prerequisite
of world peace—world organiza¬
tion or no world organization.
7

have

whether

got to face

we

would be

like them

the facts
not.

or

of world

,

claim the Moscow agreement is a

tlements.
To

\

.

quote Phillip Simms, "To

vast

a

majority of the United Na¬

the outstanding tragedy of
Big Three meeting at Mos¬
cow was the Anglo-American sur¬
render to ;the .Soviet;'thesis that

tions
the

.

Norway, Denmark, Holland, Bel¬
gium, Czechoslovakia and others
banished

—was

the

from

table.

peace

pean

Euro¬

Yet, from the

point of view of the United States.
and' free peoples every¬
where, it is highly important that
France be restored to her rightful
Britain

place."
;

-

-1

-

u k

-

'
V■.}. j.

;;£A.v.i;AA
'•

'"4,...-V

-.c

A

.)/• "'v

•

rule

world

'i"r

''V

•

.

belongs only

to

the

of

Nazism

which is

United Stbtes entered the conflict

fellow, member of the

a

we

great

against

war

to

foundation

Fascism.

and

It

was

Hhi^ ' conception that the

against
than

the

was

the

a

Axis in 1940, more
before our shooting

year

began at Pearl Harbor. It

abolish

was

this. ideology

that the
people of America went into debt
for: $250 billion and sent hun¬
.

;

A

•

EDITION

NEW

'

■

'■

'.;,AA

A

:L:-:

V.

-

A/A;■

Aw-Arx V'A'1:il'"'

rh '■

of this famous book .7

.

.

-

;

,

'dicial settlement, resort to re¬
not mean appeasement. The peo¬
gional agencies or arrangements,
ple of the United: States should

of the dangers of I or other- peaceful means of their
own choice."
'
Yet,, aside from
Germany, our foreign policy has
"Now, regardless of our obliga¬
been one of conceding today what
be

fully

aware

,7 "appeasement.'-

•

,

Our

'

was

under the

tion s

refused yesterday.

we

,

.

Charter,' we are
threatening
a
fellow

officially

foreign policy at Moscow
from QUr foreign

member

different

the

of

United

who

and

shall

rule

the

190,000,000 people
of that vast country have no voice
whatsoever
Once in

in

•

the

to put their cross
party ticket which

on

the

the onedictator¬

ship has arranged for them."

s

Nations

policy at Yalta, at the Council of
in London or at Ban

"According
Byrhes-Bevin

Francisco.

policy towards Argentina, did we
use all our strength and influence,
to: get her into the UNO at San

world order is to be conducted in

fect,

Francisco?

the' peace

77 77 At Moscow
sia's

we

conceded to Rus¬

demands that the Big Three

peace—that she be permitted to dictate the peace and
re-draw the map of Eastern Eu¬

write the

rope

and the Balkans.

,

^ -

.

:
v

'It is

them u.fntb.« a<

the

can

port

Pacific,

our

of our ac¬
policies in

and Assistant Secre¬

our

of the

principles

of collec¬
the UNO
«
-]

are

administration

confusing

internationalism

imperialism—or whether the
t'onal administration actions

with
na-

are
unbridgeable. ■
<
»
maintain free govern- ; rot inconsistent but a definite polment only as we—each and every ! icy of building an alternative to

to

•

can

individual—are prepared to
its defense.




Big

ih<* UNO.

rally
I

In any

the

new

First, in ef¬

way.

Three

will

dictate

and

UNO."

;;;;,:;

"World

:

such

■

:■

based

peace

arrangement,

•i>.;

J. r

on

any

declares

Au¬

stralia's

Foreign
Minister, "k Dr.
Evatt, will not work.
The attempt to make it work, he
says in the January number of
Foreign Affairs is largely respon¬
Herbert V.

sible

for

the

New readers will find this latest

...7:

event, at the critical

no

Written in

terest.

and

rewritten

market

the

same

at

Potsdam

—

at

Moscow

—

all

have the effects of treaties. None
of

them

were

ever

submitted

to

the United States Senate. Exemp¬

tion

was

claimed bv the President

because of

[,•

A: .,;.

SUCCESS."

edition of vital; in¬

simple language, it explains the basic

to

take

into

full

Sent

Purchase

on

15 days

price refunded upon request*

o

undemocratic

procedure slowly gaining ground
at home. The agreements made at
Casablanca—at Teheran—at Yalta
—

7A■ 7

position right up to

'

Weakening Confidence at Home
see

,v

profitable trading, and lays down easily
understood, workable rules. The book has been tevised

,

We

:'

elements for

present world-wide

pessimism and disillusionment."

a7

-

"THIS IS THE ROAD TO STOCK MARKET

control the

:

•

;A

"-;7

HOUSAfJDS of traders read, tbe f;rst edition of

whole-hearted sup¬

wondering whether
is completely
ignorant in the concrete applica¬
tion of these principles and are
People

this

principles and Ameri¬
traditions, and one intent on

■We

.

Moscow,

charter.

political
upholds

wide and

same

allow the smaller
powers to give it their okay. Then,
by means of their veto the Big

tive security as stated in

building up a totalitarian police
state —that
gulf is increasingly
•

consequences
at

fidence in

American

.

the

the

illustration

tary of State Braden's New York
soeech, are to weaken world con¬

against Utah - American,
political
"goord squads" now attempting to
regimefit our- national life!- The

between these two
philosophies —one that

then—

Confidence Abroad

simply, another

The
tions

citizenry

gulf

wrong

■

.

overcome their
inertia and unite

militant

either

of the complete inconsistency and
expediency that is lowering Amer¬
ican
prestige
and
y influence
throughout the world.
-

■

people that will
compldcbncy and

were

wrong now.

Weakening

of the

of the right.

"

,

much

the ;*5 Molotov-

to

formula,

Three will be able to

■

left, or reactionaries
V: >;'
777 "• •
Let's create a new political consciousness among
the American

7 ists,

.We

or

earnestly believe that we can get
our country back into the middle
of the road—away from extrem:

MOMENT OF G06HG TO PRESS

proceedings.

while they are allowed

a

with punitive action."
;
7 Why, if that is our fundamental

Ministers

.

REVISED RIGHT HP TO THE

Soviet Union

The

how.

>»>vary

char¬

acter arc m, in.a-;y

necessity. Their-

character proved

to be permanent

SEAMANS-BLAKE, INC.
841

I

WASHINGTON

W.

Gentlemen:
reserve

the

I

am

It

calamity, at this state
affairs, if the spheres bf
influence
drop
to
two
major
powers. Therefore,
we must try
to keep the British Empire going.
We
must
bring back into the
(Continued on page 875) v;;
a

t

qlpgies which—as far as we are
cpneerned — were ; definitely ,;.iiv- V; "The parties to any dispute, the dreds of thousands of their sons
cofttinudhce' of! whi.ch is' likely' to to die on battlefields all over the
.yplved in both 'world wairs.^ It .is
world. World rule by a few means
obvious as negotiations go -oh, endanger the maintenance of iriternational
peace
and security, carrying Nazi -Fascist-Communist
.77 adjustments must be made. Adtotalitarianism from the national
justments on details, but not prin- shall, first of all, seek a solution
| by negotiation, enquiry, media- to the international level. Within
OipleSi'v'gS'O'/-; A;
■:
ti on, conci liation, arbitration, j u- the Kremlin, a few men decide
'.
' By patience and fairness I do
;

one

hate and revenge on

ac¬

"Apparently Mr. Braden did not
realize, in making this speech, that
he was attacking a government

7:777::;7i:A777

ways.

think

I

the

argu¬

was

Thus, it already is another source
of mistrust and suspicion that is

"That

should be patient [United Nations. His official deand fair with Russia—but firm. j runciatipns, as made public by the
Much more firm than we have 'Department of State, come peril¬
ously close to violating the first
been, in standing for those prin! paragraph of Article 33 of the San
ciples and those international ide| Francisco Charter, which reads:.
;

the

what

foreign policies. We have
"hallelujah" aspect on

our

allowed the

tually the intent of the Big Three.
It is already being differently in¬

tatorship.";.'^

feeling themselves strong, are asserting themselves in unreason¬
able

'

punches, he then

made

'

Appeasing Russia
./Now let me say

before

over

/

realistic

very

never

confident of its success, is
threatening to divide once again
into"-, spheres
of influence and
power
blocs that have always
meant trouble and grief for man¬

constitu¬

,77

fearing-we are drifting away

tfbra the UNO, and
very

nothing in the book of diplomatic world rule belongs to the great."
etiquette that requires us to em-, •A.
A"'7'A777*-;''A7^;7?^
brace the enemies of our way of
"Even France—not to mention

v,

lam not

started

.

5

•

and
let¬

Washington news
ter, "Human Events";
V
"Without mentioning Argentina.
by v name, but unmistakably de¬
fining that nation as his target.
Mr.-Braden said
;
"there is

Not
to
keep i Great
Britain
77; strong would be to abandon the
V. continent of Europe to. Russia. If
7 that happens, the weight of Rusy sia fulls across Asia as well as
.

-

farsighted

tions.

\

home

reached

our

and

democratic approach to peace set¬

concord of na¬

■

Secre¬

p To quote the very informing

British Empire a going concern—

Europe.,

in

agreement was so loosely drawn
Secretary* Byrnes V barely

that

ment

; ••••':/.;

;

We haven't been

Moscow

of the UNO.

people
under¬

tion.

appeasement policy.
t
7
In any event, no one can deny
that our government on all these
points has made a long retreat
from its previously announced po¬
sition. If we were right • before,
we are
wrong how. No one can

where it is vitally
essential to America to keep the

-

the

the curse of the

to the place

strong in a world

there came

is

Byrnes' Oct. 31 position. . }•
At the very moment Secretary
Byrnes was participating in or¬
ganization of the UNO, the. As¬
sistant Secretary of State, in New
York, in thinly veiled language
urged punitive action against Ar¬
gentina, regardless of Article 33

The. mismanagement of our; in¬
ternational relations has brought

.

ago

;

,

agree¬

and made with more or less snap

Truman also "must have been gomversant with and a: party to this

r

us

days

,

tary

stand and approve it.

7

ten

>

it

of

San Francisco charter and

The great

policy which the American
will support because they

Policy

shocking example of this
administration retreat from the

foreign policy.
thing is that what we
do shall be based on a consistent
a

>

worst

another

important benefits

American
:

on

Francisco,

The Argentine

to be derived from the debate—
namely the broader aspects of

I

out

The

terpreted

;

of the most

walked

he

made at San

we

:;,7V.77 7 a. ,7'
If the Congress bogs down in
discusing only what we are get¬
ting and what they are getting, it
will be in danger of passing up
political one.

;.a

It

UNO-setup.

with-the

accord

xVIoscow

•

UNO,

.

.

gress
and the ^American people
>7 will not lose sight of the funda¬

•.

ment of the birth of the

executive

.

.

.

-

,

Byrnes

Secretary

these

that

ments, dealing as they do virtually
with, the division, of the world,

;77:'.■ ; policies are bound to create doubts
"We cannot recognize regional as to our confidence in its work¬
This is not the occasion to em¬ arrangements as a substitute for a ability and as to our sincerity in
world-system. To do so would not abiding by its terms. :777'::77
bark on a detailed discussion of
Again,' we reversed ourselves
the terms of the proposed British promote the common and para¬
mount > interests
of all nations, when we accepted at Moscow a
financing agreement.
7
control council for Japan, and the
But. I hope whatever the debate large and small, in World peace."
an
Asiatic commission.
That statement is completely in idea: of
over those details—that the Con¬

r

•<

31

Oct.

said:

MiIitaryne-;

hbrjqhgei? -exists1. My point

cesSity^

BLVD., CHICAGO 7, ILL.

enclosing $3.00 for "THIS IS THE ROAD TO

privilege of returning book for refund within

?

STOCK MARKET SUCCESS.

15 days. \

<

,

874

February

r,

Calendar
of New

-30

NATIONAL

Offering—The price to the public is $6
share. , In
addition to the 300,000
being offered by the underwriters,
the company is selling 25,000 shares direct.
Underwriters—Van Alstyne, Noel & Co.
per

List

of

less than

filed

were

registration
twenty

whose

issues

statements
ago,

v-':: '•'.

Cohu

&

Torrey

underwriters.

1

UNITED
Jan.

V'.-';,

STATES

filed

29

92,344 shares

stock,

of common

Offering—The

SATURDAY, FEB. 16

for

scribe

of Phila¬

Details—See

31.

of Jan.

the

2V2

of

rate

shares

of

price to the public will
fee filed by amendment.
Underwriters — Merrill
Lynch,
Pierce,
Fenner & Beane and Butcher & Sherrerd.
Offering—The

purchased

to

the

MORRIS
Jan.

OF AMERICA

PLAN CORP.

filed

29

on

registration statement

a

shares

of

Feb.

1,

-

.

■■

,

,

regis¬
tration statment for 120,000 shares of 5%',
cumulative
convertiblepreferred
stock
.•" (par $10).
\
"
'*
'
,! ' Details—See issue of Jan. 31.
:
Offering—Price to the public is $10 per
GABRIEL

CO.

28 filed

Jan.

on

,

chare.'

1

185,000 shares

/

'

|

statement

common

by amendment.

Details—See issue of Feb.

the

various

UNIVERSAL
filed

30

PICTURES

registration

a

.

with

fused

Industries,

Higgins

Inc.,

aggregate valur
ation of $3,040,000). The underwriters are
also purchasing from the company at 10
cents
per
warrant share,
warrants en¬
titling holders to purchase 100,000 shares

-fir
.

A-fiu'

X-X.X'

of

($1

of

authorized,

shares

2,000,000

par),

of

capitalization

is as follows: Common, stock,

company

which

an

The

stock.

common

the

at

taken

being

stock

1,200,000 will be outstanding and
warrants
to
purchase
common
all
of
which will be outstanding.

Under

date of

200,000
:

into

entered

for

1946, the company

29,

with

contracts

a

*Mus,

.

«uy

in each case, the right to share
additional
compensation
based

bonus

profit

or

The

mon.

shares of

plans.
Alstyne, Noel

heads the

Co.

&

BURRY BISCUIT CO.

$1.25

Jan. 29 filed

on

convertible

Offering—The price
$26.50 per share.
Underwriters—The
is

headed

N.

Y.,

by

and

.troit.

of

also

of

CO.

Jan.

on

registering
for

reserved

common

exercise

De-.

Corp.,

29

statement for 100,000
stock,
par
$1.
The

common

is

company

of

RADIATOR

registration

a

Higbie

v-f;-..'

..

shares

M.

upon

Details—See issue Of Feb. 7.

,

Offering—The
per
share.

price

$8.25

purchase

common

prior to

Feb.

1,

stockholders

to

Of

the

to

public

Is

warrants

40,000

to

of

recapitalization
and
20,000 are being sold to underwriters at
10 cents per warrant share.
Underwriters—The

Van

Alstyne,

group

is

headed

ferred,

registration
of

common

shares

sale

are

for

served

on

statement

Jan.

for

29

425,000

filed

a

shares

being
and

issuance

par, of which 325,000
presently
offered
for
100,000 shares are re¬

upon

the

exercise

warrants.

of

offered

by

the

of

fiftieths

.

"IT




"

additional
travel¬

cumulative

stock,

Congress

con¬

and1

$50

par

10

par

cents.

Street,

The

—

required

deferred
the

by

sale

Boston.

'

will

be

com¬

arising
appliances,
additional de¬
to

present

New

filed

for

each

share

preferred

-

holders

20,392

7.

stock

of

con¬

filed

shares
the

on

of

stock

of

A,

of

preferred
share for each

one

held

at a

The

will

be

called

share

per

for

panied

by

shares

of

ferred

40
4%

stock.

4

at

rights in

price

a

exchange

cumulative

to

include

exercise

on

of

warrants.

issue of Feb.

'

Offering—The
shares

of

be

filed

on

which

'

the

109,400
price

to

public will be filed by amendment. ;;iv
Underwriters—Reynolds & Co. heads the

group.

CO.

Feb

on

4

registration statement for $2,500,000
15-year sinking fund debentures, due Feb.
1, 1961, and 357,500 shares of common, par
The

interest

amendment.

.;

Details—See

rate

",.•■* '1

will

be

by

a

issue of Feb. 7,

>:?'-

Offering—The
offering
prices
of
the
debentures
and

to

public

the

common

will be filed by amendment.
Underwriters—Stone & Webster Securi¬
ties Corporation is named principal under¬

writer.

/r.-v

UNION
filed

shares

of

CORP.

tion

shares

of

the
for

for
at

sale

to

by the

sale

the

company

for

effective

$15.50 per

chased

New

for

capital stock, Without par

Offering—The

to

same

York,

a

period

date

of

4

42,000

value.

i

''

will offer the
of two weeks
their

stockholders

share.

Feb.

on

statement

Details—See issue of Feb. 7.

after

at

registra¬
the

price

The shares not pur¬
will be offered

stockholders

the

statement

4%; cumulative

public

by

the underwriter

price of $15.50 per share.
W.

Brooks & Co.,

preferred' Stock,

Business—Public

utility.

25,845

shares
at

preferred stock,
The old preferred is redeemable

$125

share

plus

granting

to

per

is

company

right

to

shares

receive

each

amount
to

old

dividends.
such

redemption
of

4%

price

by

the

the

will

right

preferred

the

of
de¬

preferred

new

preferred.

preferred

The

holders

preferred
old

shares,

holders of
of

of

new

'675,000

an

old

shares

share

of

the

of

livery of six
for

call

of .7% "cumulative

$100.

par

to

146,478

As

be

is

the

limited

limited

to

preferred

share

of

preferred

will

demption

be

price

required
of

their

shares

the
in

re¬

made

a

commitment
The

that

provided

bidding
its

through
of

common

the

140,000
stock

for

plans
such

at

a

of
cash

sale

bank
the

be
at

additional

the

same

shares
time

parent, Standard Gas
makes its contemplated

competitive

of

eventually
competitive

company's
Co.,

loan

company

bidding, of all of the

stock of Oklahoma owned by it.

&

as

of

the

Elec¬

sale,

at

common

as

net

a

proceeds

of

part

by

will

t

first
old

for>--;i

the

proposed
require »the " sum

will

Underwriters

fi¬
-of

on

1

$10

in

cash

for

exchanged,

adjustments.

tion

prices

be

of

plus

Any

•

$115

for

the

$7

300,000

"shares

posited

for

of

old

and
more

If

$105

.

CO.

the

interest

in

of

25

The

shares. ;

Offering—The bonds
be

treasury for prepayment on Dec. 31,
of $2,250,000 27/b%
1945,
notes and
to
portion of the funds required in

a

with

and redemption

the,, proposed

exchange

of its old preferred stock.

Dealer-Manager—The company has re¬
Merrill
Lynch, Pierce, Fenner &
Beane
as
dealer-manager to manage a
tained

of

group

securities

dealers

obtain

to

ac¬

ceptances; of the exchange offer.
Registration Statement No. 2-6146. Form
S-l. (2-8-1946).
;

CHERRY-BURRELL

registration
of

CORP.

has

filed

a

statement for 40,000 shares
preferred stock, par $100;;

dividend

will

rate

be

filed by

amend¬

Randolph

Street,

ment.
Address

Chicago,

427

—

West

111.

;

and

Offering—The
of

the

holders

the

tunity
cash
a

offering 13,-

company

shares

40,000
of

its

series

of

13,549

preferred

shares

preferred

in

an

of

to

5%

oppor¬

exchange their shares for
a share for share basis

to

a

machinery, equip¬
industry.

for the dairy

supplies

549

>

;

Street.'

Franklin

price

the

from

the

and

*•

;

preferred stock'
'bidding and

filed
net

bonds

a

by amendment;-b

|
from/ffee

proceeds
and

preferred

two-year bank loan

>

stock,
of

2%

at

together with general funds of

!

the

to

company

extent required, will
redemption at 101 :on
Sept. 1, 1946, of $10,961,000 first mortgage
4% % - goldv bonds; to the redemption at
be

applied

105

the

to

;

Oct.

on

1,-1946, of $7,800,000 first
mortgage
5%
gold
bonds;
to
the redemption at 102 on
Aug. 1, l946;^of
$12,930,500 first mortgage and
refunding
5% gold bonds series A, and to the1 re¬
refunding

demption
at
103
on
June
1,
1946; of
$2,016,500 first mortgage and
refunding
5% gold bonds series B, which, with In¬
terest, will approximate $35,325,208.

Underwriters—The
writers

will

;

the

of

names

filed

be

under¬

by amendment.

Note—The company said it
will, upbrt
the request of Federal Water & Gas
Corp.;
parent, file a registration statement

its

Business—Processing
ment

of

$1,000,000,

cumulative

The

,

'#

The

fifed i

be

at -competitive

I Proceeds—The'

its

provide

sold

the offering

com¬

and

to

will

,

North'

'■

$100.

par

rates

•

Business—Operating public utility.
will

sale

proceeds

stock,

dividend

'

v

•

'

will

reimburse

the

use

and

preferred

and

WATER

bonds, • due
100,000 shares of
*

Wiike&-Bam;"Pa^:$^

de¬

are

company

up

excess

and

mortgage

1976,

by amendment.
K Address — 30

also plans to sell to banks $7,600,000

notes

15,

BROOK

registration' statement for

a

first

'

cumulative

to 25 shares in full and
shares' deposited
by a single

rate

pany

filed

March

,

shares

has

$23,500,000

than

preferred

exchange,

ex¬

preferred,

C.

"SCRANTON-SPRING

of

redemp¬

the

Jeffries &
Thorndike, - Inc.
ahd
Wainwright- & Co., and as to the
First Colony Corp.
'Registration Statement No. 2-6149. Form
8-4. (2-8-46).
'.

divi¬

not

the

at

to

Childs,

H.

each

cash

shares

redeemed

As

—

common,

without
share

one

on

new

with respect to

stock,

1,000,000 shares of

such part thereof
offered by Federal

or

after

be

Corp.; and

that

Federal

is

order of the Securities and
mission

to

divest

itself

as

common

:

here-

may

Water & Gas

subject to an
Exchange Com-

of

all

interest

i;

P

in

Soranton-Spring Brook.
Registration Statement No. 2-6150.

plus

The exchange offer
of recapitalization of
the company/ in pursuance of which 26,451

shares

tration

Form

S-J... (2-8-46).

adjustment.
in

step

shares

of

the

not

preferred,

plan

a

preferred,

exchange

to be sold to
them to the

are

will

together with the

in

issued

offer

for

old

underwriters
public at a

net

Proceeds—The

from

proceeds

the

be used for
for acquisition of
and equipment, for

plant construction,

additional

machinery

for redemption of the 5%
dividend series preferred and for Working
capital. :
The
approximate
expenditures
exchange

or

include

contemplated
struction

of

$1,300,000

for

Little

Iowa;

Rapids,

^alls, N. Y., and balance for work¬

capital.

Ty.

'

•

DALLAS YELLOW KNIFE GOLD MINES,

has

for 300,000
.

filed

■

registration

statement

shares of capital stock, par $1.

Address—356

tario,

a

Bay

Canada..

Street,
:

.

Toronto,

On¬

* •''

.

Business—Mining.

share

are

Proceeds—The
carry

on

offered

'exploration

the company's

as

proceeds

and

a

will

speculation.
used

to

development

of

be

mining properties.

regis¬

•

the

common, 18,000 shares are being
by certain stockholders.. The dividend

rate

will

be

filed by

Address--One

C

amendment. ""

Wall

Street,

New"

York.

n; y.
P Business—Fine
and

drugs,

house

in

and

and

is

medicinal

the

this field.-

chemicals

principal long-line
'V../ v/.P.n

Offering—Holders of the company's out¬
standing AVifa and 514% cumulative pre¬
ferred

stock

are

exchanging

on

such

for

The

stock

offered the
opportunity) of
before March 11, 1946,

or

the

underwriters

preferred

change

stock

offer

new

will

and

preferred

purchase

issued

not

sell

them

to

stock.

the

new

fee

under

ex¬

the

public
at a price to be filed by amendment..---The
offering price of the common stock will
be filed

by amendment.

Purpose—The
issues

of

effect

the

cumulative
additional

purpose

preferred

outstanding

and

retirement

shares

of

of
of

for

the

proposed
stocks

is

the

4%%

preferred stock,
funds

,

common

presently
and
514%

and to provide

the

company.
Upon
issue of the new preferred stock, and when
the exchange is declared
effective, the old
preferred stock is to be called for redemp¬

tion,

Offering—The
300,000 shares
are
of¬
at a
price of 50 cents per share.

fered

These

a

for
120,000 shares of
preferred,
without par value,
118,000 shares of common, par $1.

and
Of

to

LTD.,

INC.; has filed

CO.,

statement

.

con¬

additional factory building

an

$500,000 for new
machinery and equipment; $1,422,645 for
exchange for or redemption of the 5%
preferred, exclusive of accrued dividends;
$300,000 for additional plant facilities at
Cedar

"&

cumulative

of the 40,000 shares will

issue

at

'"MERCK

sold

price to be filed by amendment.,

cash.

redemption price of the 33,978 shares
of old preferred is
$4,247,250, exclusive of
accrued dividends,
and the company has

contemplate

and

all

of

take

to

of

filed

available for investment by the
corporation.

$7

preferred

dend

The

$4,200,000.

basis

Underwriters — The
Illinois
Company,
Chicago, heads the underwriting group.
Registration Statement No. 2-6147. Form
S-l.
(2-8-1946).
'

deposit
of 112,500 shares
(76.8%)
preferred,
The holders of the
33,978 shares
(23.2%)
of old

old

preferred,

ing

aggregate
the

be

the 2,195 shares out-i
plus accrued dividends. .The re¬
of
the proceeds will
go
to
of the corporation; "and become

mainder

preferred, and one share of
preferred for each share of $6 and

new

$5

$5

the

on

first

who

to

public'by

redemption of the
which is to be called

This

treasury

shares

value,

new

company intends
its
outstanding

redemption

price

balance

the

the

stock,

standing,
Birm¬

ferred, par $100, at dividend rate of 4.20%,
will be offered in exchange to the
of its outstanding 355,876 shares
of preferred,
consisting of 159,575 shares
$7 dividend stock, 170,456 shares $6 and

who

/

Address—321 North Harvey Street, Okla¬
homa City, Okla.

tric

Inc.,

for ;675,000

par $20. -:

remaining
ROUE

registration

a

shares

WIRE

amend¬

to

price.

oL$105 per share

which

is

registration

their

,••*•"r,

?

,

filed

by

OKLAHOMA GAS & ELECTRIC CO. has
filed

a

$1.

filed

in¬

$230,475> Representing the redemption price':

holders

dividend

8-4(2-7-1946).

for

MILLING

amend¬

wf."-,

a

applied 'to

nancing.

Business—Public utility.
Offering—The company proposes to Issue
not -more than 300,000 shares of new
pre¬

preferrea

Offering—The
filed

be

1

/;

STANDARD

by

Registration Statement No. 2-6143. Form

:

7. ?

includes

offering

common

pre¬

ment.

70,000

COMPANY has filed

Street,

The

are

by

offered

offering

preferred

18th

gtock

unsubscribed

be
at

Proceeds—The
be

:

~

for five

convertible

..-y

Underwriters—To

for :119,400

shares of common stock, par $5 and 10,000
common
stock
purchase warrants.-;. The

registered

dividends.

Any stock not taken upon
of rights will be sold to the

exercise

public
Feb.

at

certain conditions the company will
accept shares of 6% preferred stock, series
A,
in
the
ratio
of
four shares
accom¬

the

on

redemption

plus:;;: accrued

public

Securities Corpora¬

North

amendment.

amendment.1
The common stock will be
offered to present common
Stockholders at
a
price of 50 cents per share under the

go

20,392

ment..-

CO.

price to.be

Under

offer

SATURDAY, FEB. 23
statement

rights to

convertible

basis

common

—

which

$125

—

WINDING

to

shares of con¬
being issued for the
purpose of refunding the outstanding 21,136 shares of 6%
preferred stock, series

alQng with the 50,000 shares of pre¬
ferred at prices to be filed by amendment.
Underwriters
Kidder, Peabody & Co.
head the underwriting group.
••

registration

com¬

issuing

by amendment.

Purpose

pre¬

held

Boston,

investment

Common

will

by

common

,

connection

is

shares

of

The

will

underwriters

April 1. 1946.

ingham, Ala,

vertible preferred'are

them

a

shares

preferred

Street,

company

its

of

8 shares of

three-

of

and

for

20,392

convertible

Federal

Offering—The

the

',<.n

1

convertible

subscribed

not

for

remaining

filed

being offered by the corporation
for
subscription by its present common
stockholders at a
price to
be
filed

'at

1945,

public

be

shares

company. :

shares
of
4%% '
^preferred
will
be
by underwriters at,

itially

stockholders.

Address—600

v

pro
CO.

pany.

on Feb.
14, 1946, at a price to be
by amendment.
The underwriters
purchase any shares of convertible

will

cumulative

par $100.
Address — 49

and

common

registration

a

15,

the

to

100,000

investment

15,000

convertible

to

price

a

registration statement for 300,000 shares
of 4.20% preferred stock, par
$100, cumu¬

holder

SECURITIES

stock,

will be initially
to holders of

of

LIGHT

Mass,
Business—:Closed-end

pre¬

ratio

&

Oct.

for the $6 and $5 preferred.

TUESDAY, FEB. 26
has

the

selling

changed will

etc.^

RAILWAY

offered

its share of

use

(2-8-1946).

new

Registration Statement NO. 2-6142. Form
(2-6-46).

record

filed

from

the

custom¬

household

diversified

a

common

working

in

to

Offering—The

will

'

company,'" with
from a non-diversi¬

change

amendment.

par

accounts
of

public

a

shares

th£

improvements

fied

-

the

to

redemption

filed

additional

acquisition

stores,

V

'

reservation

related

non-diversified

investment

cumulative

on

ALABAMA POWER

<

increases

of

be

proceeds

payment

possible

redemption

Underwriters—Union

each

to

of

and

i?
: tion heads the underwriting group.
Registration Statement No. 2-6145. Form

who will offer

funds

tools

plus

to

price to be filed

a

general
used
for

.and

for

unsubscribed

net

'.'y

.

Closed-end,,,

—

management

accrued dividends, of the 18,972
of 6%
cumulative
preferred,
par
approximately $400,000 for machin¬
ery, equipment, etc., and balance for gen¬
eral
corporate purposes.
The net pro¬

-

S-L

1

$100,

shares'

of

share

a

110

ot

Underwriters — Lehman
Brothers,
York, heads the underwriting group.

50,000

second
'

the

in

the

de¬

stores

price

Business

$100;

classi¬

f

corporation

stock

common

Underwriters—P.

Details—See issue of Feb. 7.

4%%

Mass.

Cin¬

shares

reg¬

,

Avenue,

owning

share

underwriters

to

the

to

stores,

The dividend rates will

100,000
preferred

second

vertible

by

stock, $1

cash

for

CO.

sold

partment

.

Feb.

on

for

par

issue of Feb.

Offering—The

ferred

stock,

by amendment.

Details—See

Noel & Co.

SHOE

The

amendment.

etc.,

by
i'jj&f

CORP.

convertible

of

$100.

par

be filed

42,000
REGAL

a

filed

Dillon & Co,

statement

preferred

shares

100,000

its

MILLS

registration

a

shares

stock at $8.25 per share
1951, 20,000 were issued
on

at

Trdm

49,017.

shares

warrants.

held

capital

WEDNESDAY, FEB. 20

shares

40,000
issuance

of

Address-4-50

by amendment.

for

allot

priced * will *-b'e
*
f.<, 3! «

BURLINGTON
filed

is
;

shares

ers'

Jan.

the

public

the

one

of c4%

underwriting
group
Alsyne, Noel & Co.,

Van

Carlton

YOUNG
filed

to

of

'

Machine

—

lative from

rate

pany

'

Details—See issue of Feb. ,<7.

•

a

preferred

100,000 shares of common,

v: :y"n'.r

•-

Proceeds—Company will

York,

stores

department

the

added

preferred.

Details—See

a

as

Proceeds

offering

Underwriters—Eastman,

statement

for 100,000 shares
preferred stock, par $20.

5%

INVESTMENT
CORF.
registration
statement
for

shares

vertible

being sold by the

are

4701 'Marburg

Ohio.

filed

ceeds
a

operate

smaller

the public at
by amendment.

-•

is

company

amendment.

issuable

registration

and

advertising and

STORE

filed

15,000

for

$10.

par

the
proceeds
to
restore
to
its
treasury
funds expended for capital purposes
during
the past six months as follows: $2,115,378

Inc.

New

which

and

them «to

shares
being sold by the company, 39,400 being
sold
by certain stockholders and
10,000

to be

subsidiaries

will be

common, - par

Offering—The

».

shares

underwriting group, with names
filed by amendment.

of others

has

CO.

statement

stock,

.

Details—See issue of Feb. 7.

filed

sharing

Underwriters—Van

XXX^X'.'

of

UNIVERSAL

in
on

CHAIN

MACHINE

common

machinery and products.
Offering—-The price to
be

company

at

by

pre¬

$1, 80,000
shares of
cumulative
preferred, series A,
par $100 and common stock purchase war¬
rants to purchase 50,000 shares of com¬

1946,
less than $80,000 and $35,000, respectively,
■

CO., INC., on
statement for

cumulative

registration statement for 475,-

a

shares

000

Higgins and Morris Gottesman,
period of five years from Jan. 1,
at an annual compensation-, of not

-

of

116,887

—

Business

1947
will be

Offering—The 257,840 shares of common
are
being offered
by
the
company
for
subscription to the holders of its common

J.

Andrew

■;.l

Jan.

employment

filed

30

now

:plant and property for approximately $4,E38.000 in cash and 300,000 shares of comimon stock, including the shares subscribed
for by the incorporators, and 100,000 war¬
rant shares entitling the holders to pur¬
chase
100,000
shares of common stock
Hthe shares of common stock and the war¬

Holding

—

stock

M. LOWENSTEIN & SONS, INC., on

'3n' statutory liquidation.
It is intended
Hijgihs, Inc., shall acquire from Higgins
Industries Inc. a portion of its. business,

rants

head

Offering—The price to the public will be
filed by amendment,
v
Underwriters—Dillon, Read & Co., Inc.
heads they underwriting group.

$11
$9,900,000. Under¬

cinnati,

various

specialty shops.
Brothers

underwriting group.

Jan.

7.

commissions
are
^placed at: 90 cents a share, leaving net
ijprceeeds to the company of $10.10 a share
<cr
a : total
of
$9,090,000.
Higgins, Inc.,
Was incorporated on Jan. 9, 1946. Andrew
&T, Higgins, .acting on behalf of himself
<ianl associates, was active in the organ.'ization
of the
company.
The statement
.'points out the company is not to be con¬

total

Address

shares of

257,840

seven

Offering—The price to the public is
:per share, or a gross of
writing
discounts , or

the

A-2.

Business

statement

Details—See issue of Feb. 7.

regis¬
tration
statement for
900,000 shares of
common
stock, par $1, to be offered to
public, and 300,000 shares issued in con¬
nection with acquisition of property.
■

MILLING
registration

a.

shares

holders.;;

Y.

N.

■

Lehman

—

for

Broadway,

.junior

shares of 414%
ferred stock, par $100.

' A'

SUNDAY, FEB. 17

'

30%

cover

Registration Statement No. 2-6148 Form "'
S-l 1.
(2-8-1946).
'U;/&': ;"v< S

company to the underwriters, and 113,113
shares
are
being sold by certain stock¬

year

stock, without par value.

Address —1440

MONDAY, FEB. 18

HIGGINS, INC. on Jan. 29 filed a,

Of

MONDAY, FEB. 25

fied

Underwriters

each

ALLIED STORES CORP. has filed
istration

Offering-—The price to the public will be
filed

of

1

Co., Inc. and McLeod,' Young; Weir,

stock, $1 par.

common

60,000

'

230,000

Harriman

are

stores

\

named principal underwriter.

is

has "filed

;

by

Offering—The offering price to the pub¬
will be filed by amendment,
Underwriters-^The principal underwrit-*

partment

Underwriters—Sills, Mihton & Co., Inc.,

.Chicago,

'

through 1975.
The interest rate
filed by amendment.' ■
Details—See issue of Feb. 7.

Details-—See issue of Feb. 7.

a

>

CINCINNATI

price

a

headed

to

.

Ripley
&
Co.,
Inc.,
Smith, Barney & Co., First Boston Corpo¬
ration,
Dominion
Securities
Corporation,
Wood, Gundy & Co., Inc., A. E. Ames &

i,

•

at

;

is

mature serially in

Nov.

on

7.

registration

a

,

for
•

filed

29

Jan.

on

■

'

of

allowance

ing -expenses.

WEDNESDAY, FEB. 27

MONTREAL, CANADA on Feb
$85,980,000 debentures, dated

1946, to

amounts

ers

against warrants. '
Details—See issue of Feb.

OF

registered

lic

reserved

common

4

t

issue of Jan. 31.
Offering—-The price to the public will be
Offering—The
offering prices to the filed by amendment.
Underwriters—To be supplied by amend¬
public are as follows:
debentures, 98%,,
preferred stock $10 and common stock $6.' ment.
Underwriters—Herrick, Waddell & Co.,.
LOGANSPORT DISTILLING CO., INC.,
Inc., New York, is named principal under-

writer,.

underwriters

commision

each

Glore, Forgan & Co. and Harriman Ripley
& Co., Inc.'
""
;

Details—See

..

by

be filed by amendment.
Underwriters—The group

for

stock

common

additional

000

cumulative constock,
(par $10), and
shares of common, (par $1).

80,000

for

public

the

to

CITY

100,000 shares of preferred stock,

with

514%

shares of
vertible preferred

rata, at the

share

one

and

Unsubscribed shares will be offered

by

series A,
purchase warrants at¬
tached, par $1, and 150,000 shares of com¬
AIRLINE FOODS CORP. on Jan. 28 filed
mon,
10 cents par value.
The dividend
rate
on
the
preferred
will be filed by
a registration statement for $1,000,000 5% '<
The statement covers 200,sinking fund debentures, due Feb. 1, 1961,' amendment.
100,000

of

ris

Bay

to

tional

price to be filed by amend¬

a

Underwriter—Mark Daniels, 1840 Mor¬
Building, Philadelphia, Pa., and 3.71
Street, is named underwriter
with

company will make

dealer-manager

a

.

be

'■

-

one-sixth

With

dealers

held.

will

public at
a
price to be filed by amendment.
Underwriters—White, Weld & Co. named
principal underwriters.

stockholders., The dividend
issue

to

shares

offered

shares

underwriters, and

be filed by amendment.

rate will
.

each

for

at

its common stock,; pro

of

agreement

manage
a
group
of
security
to obtain
acceptances, of the opr
right.
^^V r''.V'r
Registration Statement No. 2-6144. Form
S-l. (2-7-1946),
i
^ •

'i.X

to

granted

an

form

issue of Feb. 7*>'Ai..'V-

ment.

rights to sub¬

92,344

share

per

share

new

one

stock

exceeding

$11

Unsubscribed

of

Bold by present

of

rate

$1.

par

Purpose—To refinance preferred stock,

Dealer-Manager—The

stock

common

•,;>••,

share held at

7.••■■''• V

has

company

common

not

at

common

delphia on Jan. 28 registered 20,000 shares
preferred stock, par $100.
The shares
are
issued and outstanding and are being

its

of

of

being offered by
the company for subscription to the hold¬

for

statement

Details—See issue of Feb.

holders

COMMONWEALTH TITLE CO.

par).

PRODUCTS

registration state¬

a

Offering—The stock is

RADIATOR CORP. on

registration

a

4 filed

379,894 shares

Details—See

"

t

SecurilyFlotations

DISTILLERS

Feb.

on

for

"

principal

named

are

(no

ers

of the

less accelerated at the discretion
BEG.

ment

and

grouped according to dates
on
which registration statements will
In normal course become effective, un¬
days

CORP.

shares

FILINGS

NEW

»«r»i

W

•

which is expected

to

17, 1946.
Underwriters—Goldman,'
and

Lehman

Brothers

be

f

about

Sachs

head

the

writing group,
Registration Statement No. 2-6151.
A-2.,

(2-8-46).

June

&

Co.

under¬
.

Form.

'

';-■ -■ ■;.r:-'r ■'"■V- :v-,:«'. -. r
r" '■
"•■.• v.-. yy- a :-.{■>'■■ v;:.-tv.:,^.,..-;--.:"^•■■ '.."r:"'

/' ^
y;

;.',

■

4,vV"¥">
■■"■''■

■

■'■ '•

'

hh^v/,.

v'

::

&

istration

stock,

common

without

Address—550

lumbus,

Business

Co¬

machines,

paving
equipment,
machinery and
equipment
for. heavy-duty
construction
etc.

*

Offering—The
stock

new

the

offering

is

company

its

to

,

of

stockholders

common

the

of ,one
new
share for each five shares held, c,
r
Purpose—The
proceeds
from the sale
will be used to discharge, so far as they
may
reach, of bank loans owing by the
company as of Feb. 1, 1946, in the aggre¬
gate amount of $1,200,000.
It is the in¬
tention
of
the company to pay
off the

record

Feb.

21;

at

1946,

rate

.

balance

of

bank

the

headed

Ohio

underwriting

McDonald

by

&

ment for

Form

■i:

fcRAYSON-ROBINSON
(fdrmerly
has

50<000

value, and
$1 par.
.'
Address—498 Seventh Avenue, New York,
stock,

■

without

shares of

50,000

per share.
Underwriters—John

Details—See

,r

of

•

is

Langs

24 filed

:

underwriter.

Co.

&

is named

<

,

B-l.

issue of Jan.. 3.;

(2-11-461,
15

Offering—The public
cents per share.

i

UNDETERMINED
We

Jan,

below a list of issues
statements were filed
twenty days or more ago, but whose
offering dates have not been deter¬
present

mined

unknown to

are

or

filed

25

owned

are

Co

Offering—The

for

filed

POTASH

CORP.

statement *for

registration
shares of capital

filed

28

Dec.

on

4 CHEMICAL

&

479,726

a

The shares are issued and
and are being sold by the
Alien Property Custodian who directed the

stock

31

of Jan.

issue

to file the registration statement.
; Details—See issue of Jam 3.
Underwriters—The Alien Property Cus¬

company

todian
of

to sell tim 479,726 shares
atpublic sale Ho the highest

proposes

stock

qualified bidder.
If any such bid is ac¬
cepted and if the successful bidder plans
the

distribute

to

will

amended

be

include

to

information.

additional

the

;

Underwriters—Burr

528,390

PALESTINE

AMPAL-AMERICAN
ING

CORP.

3

Oct.

on

will

aa

filed

TRAD¬

INC.

named

29

Dec.

on

ative preferred

to' the

Offering—Tha- price

-

'

,

»

public

it

#5.50 per share.
shares

Underwriters—The

will

be

sold

through the efforts of the directors
employees of the corporation.

and

the

without

ment

dividend

of

interposition

ANDERSON-PRICHARD
filed

23

OIL

CORP.

mon

by

shares

issued

are

and

being

are

Details—See

Issue

of

75,000 shares of com¬

Jan.

31.

'

'

.,

'

Underwriters

.

underwriter.

so

as

2,595,000

i

41 filed-

t

on Jan,
statement for cer¬
tificated of deposit of $2,000,000 first mort¬
gage and collateral trust 20-year 6% sink¬
ing fund bonds due April 1, 1948,
Details—See issue of Jan. 10.
1 *

/

of

registration

a

Extension Offer—See below.
securities is desired
as
a

step

connection

in

tension

date

nolders

to

collateral

bonds

with
of

an

first

20-year

the

extension

preliminary
offer of ex¬

mortgage

6%

trust

for

The deposit

sinking

of

and
fund

the

maturity
April 1, 1966, and the reduction in

to

the rate of interest to 5%

of common, par $1.
Details—See issue of Oct.

Offering—Toronto

has

entered

share,

holders.

will

be

A.

P.

W.

PRODUCTS

registered

collateral
bonds

CO., INC.; on Jan.

$2,000,000 first mortgage and
20-year 5% sinking fund
shares ($5 par) capital

trust

and

80,000

stock.
1

issue

Offering—The

of Jan.

company

.

trust

20-year

offers

to

the

6%

sinking

fund

will

and

CORP.

on

stock,

$1.

par

Details—See

holders

the

terms

so

as

shares

aforesaid
are

to

be

geologist, offi¬

reduction

per annum,

of the rate
the reduction




TELEVISION

219,571
.

df

holders of

of
its

■, ■

of

Jan.

common

common

certain

of

common

24.

stock to

stock

and

all the
to

the

options for subscription

,

«Ampri

,

+l

,

hv«Sria

.n

trative

w

prestige.

imperils

But eminent

strength*.

Let

;v

,

to

''with-the-representatives

balanced

a

1

,

,

on

the

of

American people speaking,

£C.

budget and to economy and efficiency in government. If we

hope that the debate

us

thfc question of the British
subsidy

d,ay's;.work£ All. issiips .in

end ; relate

,

°Ur preSr,;

dwindling also because we
have compromised our
principles;
That weakens our moral

! "ge IS

its

on

?>°.ys

an adminis-.

non-partisan news commentators

living to those unwilling to do an
honest,

V

,»

Pf5- 6
er*

spokesman,

giv-1 America's

u

world

the

pol-

...

get

to quote

back home

|

shoulders—and continue to give a

mav

be the
opportunity for which we

have been waiting to

are

for.

secure

public on

price obtainable in small lots
to unduly depress the market.

not

stock

propsed

by the siren song that government

|

—not only the British loan—con-

is

j

sistently and with conviction.

constitutes

offering

63.9% of the company's outstanding com¬
mon stock.
There are 12 members in the
'

As far

could

Congress, as I said before, has
world«rf. ^r^t opportunity to make certain
that America does have a

endlessly.
stabilizing the

as

the

concerned—all

is

money

we

clearly defined national foreign
policy and to particpate in what
that policy shall be in the future.

Britain

Great

into

pour

won't do the job—as long as our

And let

foreign policies are based on ex¬

that

pediency, not sound principles.

the size

will

derwriter

price
the

for

filed

4

600,000

Canadian

registration

a

currency

Details—See

stock,
value each.

of

shares

common

par

issue

statement

of

Jan.

to

purchase

common

is Allen

suming
are

in

sold.

company

that

event

any

all the

shares

&

—

underwriters

No

named.

TRANSPORTATION
CO. on Jan.
17 registered 270,000 shares
of common stock, par $1.
/ .
ATLANTIC

Details—See

Offering—The

issue

of

price

Jan.

to

24.

the public will

'

whole-hearted

sup¬

INDEX
Bank

and

LIGHT CO. on Jan. 18

IOWA POWER &

filed

a

shares

$100.

statement for 50,000
of cumulative preferred stock, par
Dividend
rate
will be
filed by
registration

'

amendment.

of

by

amendment.
offered

Underwriters—To
ment.

24.

Jan.

mendations

filed

be

by

amend¬

;

-

MANUFACTURING

filed

50,000

registration

a

shares

5%

NSTA Notes
Our
Our

price
share for

to

Offering—The
$5

$10

per

Real

CO.

on

statement for

the

underwriter.

,

on

'

of Jan. 31.
price to the public will
amendment.
'AAyA-' •'

Offering—The

Underwirtcrs—Burr

York,

&

on

SITUATION

WANTED

Returning From Military Service

Jan. 24 filed a reg¬

Details—See issue

■

Section

838 and 839.

public will
preferred and

holders.

by

Whyte

....................;.?.v/;:,.870

the

statement for 98,000 shares of
common stock, par $5.
Of the total, 23,000
shares
are
being sold by certain stock¬

filed

851

Corner...

Markets—Walter

Illinois : Securities
pages

17.

istration

be

Says

Securities...............840

Salesman's

Tomorrow's

share for the common stocks.
Underwriters—Alison & Co. named prin¬

THE McBEE CO.

871
..846

/...............,, .843

Securities..... .842

Estate

per

cipal

Literature/.......844

Reporter on Governments.......843
Reporter's Report........./.....847
Utility Securities.............836

Railroad

cumulative convertible
$10, and 50,000 shares

preferred stock, par
of common, par $1. ••••"••
•
Details—See issue of Jan.
be

and

Funds.

Securities
14

856

Calendar of New Security Flotations 874
.....850
Dealer-Broker
Investment
Recom;

Public

•

McALEER

...848

Items..... .865

Bookshelf

Canadian Securities

Mutual

preferred stock will
by the company at

The
sale

for

Stocks

Personnel

Man's

Municipal News and Notes......

1

issue

Details—See

Insurance

Broker-Dealer

Yprk.

Co., New

,

Underwriters

the

Business

Jan.

is offering its
common
stock to the public at 50 cents
United States currency per share.
If the
company
accepts offers from dealers to
purchase the stock, the company will sell
to such dealers, if any, at 32.5 cents U. S.
currency per share for resale at 50 cents
U. S. currency per share.
The estimated
proceeds to be raised by the company is
$300,000 U.
S.
currency
maximum, and
$195,000 U. S. currency minimum, if all
the shares are sold bv dealers,
and as¬
Offering—The

our

port of the American people.

10 cents each or a total of

company

1
.
Underwriters—The principal underwritei

$1

10.

of

our

receive

five-year

50,000

receive

competitive bidding.
Jan.

duration

$3,000.

MINES, LTD.,

CITY PORCUPINE

GOLD
on

the

foreign policy
is
clearly defined by our represen¬
tatives, and floundering and un¬
certainty has disappeared, it will

stock at a
to
be
filed by amendment.
For
warrants the underwriter will pay

warrants

be

,.

and

Once

Offering—The offering price will be filed

paid.

emphasize once again
foreign policy involves

me

our

armies of occupation.
be: filed by amendment.
The securities
are being offered initially for a period of
15
days
to
present shareholders
under
preemptive rights at a price to bs filed
by amendment.
The holders of approxi¬
mately
200,000
shares have agreed
to
waive their preemptive
rights.
The un¬

:

and commissions are being

"sugar daddy," able to shell

a

out .money

on

best

GULF

is offering 219,-

j

i the financial

carry

/

of

burden

■,Ay.'-,.': y^y

company

its

RADIO

&

registration

a

shares

/

issue

Offering—The
shares

filed

21

Jan.
for

April

1966,

offering,

the company
employees.

statement

571

1,

the

make

purchased by

due April 1, 1948, the privilege of
assenting to the extension offer providing
for the extension of the maturity date to

bqnds

of interest to 5%

ol
acquired
offered
the public
the
option not be
exercised by
Mines Finance, Ltd.,.the company
in

Shares not
generally
to

remaining* 195,000

cials

on

expressed

is

money.

F4RNSWORTH

10.

holders of its $2,000,000 first mortgage and
collateral

option

possibly
j

1.

these

being

to

at

shares

an

V'",;

.

Details—See

Itself
The

has

Price

Canadian

Toronto

4

commitment

firm

a

480,000

and

Should

per annum.

into

Ltd.

$1.23
per
1,920,000
shares at the same
price.
The offering
Is to be made among the shareholders of
Ventures, Ltd., Frobisher,
Ltd.,; and Le
Luz Mines, Ltd. (Canadian companies) ai
M °s
ner
share,
and
to
Eureka
stock
purchase

"

,

,

is

Underwriters—No underwriting discount.'

Finance,

Mines

the

to

Exchange

syndicate.

shares

U A. P. W. PRODUCTS CO., INC.,

Curb

the

for

»

•

the New
behalf of the
Adolf Gobel, Inc., Syndicate.
The secur¬
ities will be sold through regular market
channels over the New York Curb Exchange

The

statement

'

-

sale

for

offered

at

'■■■; v.

registration

>

Details—See issue of Jan. 17.
Offering—The common stock

Co.,

&

CORP., LTD., on Sept. 28 filed

EUREKA
*

!
Webber-Simpson

—

■:

)

the public is $8

to

named principal

is

Chicago,
-

31.

issue of Jan.

)share.

per

..

.

York

Offering—The price

Offering—The prices to the public of
the preferred and common stocks will be
filed by amendment.
Underwriters—Glore, Forgan & Co. heads
the underwriting group.
■

regis¬

$1. '

par

Details—See

sold

stockholders.

certain

stock,

mon.

behalf of the Adolf Gobel, Inc. Syndi*

'

cate. f

j
tration statement for.

10 filed a
412,899 shares

for

statement

common

on

EBALOY, INC. on Jan. 25 filed a

v.+

if

stock, par $1.
The shares are
issued and outstanding and are being sold

any

for

cumulative"convertible
preferred stock, $50 par, and 425,000 shares
common
stock, par $10.
All of the com¬

public

ADOLF GOBEL, INC., on Jan.

registration
of

.Underwriters—None.-.

on

statement

registration

a

80,000 shares 4)4%

CORP. on Sept

a

lanta, Ga., is fiscal agent.

Underwriter.

Jan.

filed

Underwriters—General Finance Co., At¬

in the cooperative move¬

friends interested

not

public will

the

; Details—See issue of Oct. 4.
/ Offering—The
price to the
87.50 per share.
>

preferred stock, series A ($25 par).
Details—See issue. of Jan. 10.
Offering—Price to the public $25 per
share.
Securities are being sold by the
cooperative directly to
stockholders and

non-voting shares.
.Details—See Issue of Oct. 11.

has been re¬

registration statement for 200,000 shares of common stock, par $5.
/•

20,000 shares
non-voting

registered

of

cumulative

price; to

GENERAL SECURITIES

AA ;■

statement for 400,000 shares of 4% cumul¬

4%

by

derwriting group.

WHOLESALE,

COOPERATIVE

EASTERN

registration

a

statement for 60.00C
preferred

be filed by amendment,
*
- . ; ,
Underwriters—Burr & Co. heads the un¬

■.

honest foreign

on the
part of our national
administration is the main cause

convertible

of which 16,590 shares
certain stockholders tc-

79,590,
sold

be

Offering-^The

•

'

?:.

and

pres-

clear,

a

260,000 shares

63,000 shares will be sold by certain stock¬
holders to underwriters for public offering.

V

■■■.

.

,,

ing and spending—giving and

,

employees and others at $14 per share and

28

v-;-A

American

icy

ing. Our national government can- J

the

c
*

and

to

duced

issuance

Co., Inc.

&

?'>-»'

the number of common shares

principal underwriter;

shares outstanding.

losing

of common, going to achieve a sound future j ^^selves^and the world, a clarification of our national policy, so
par $1.-:v-> v^^r. for the United States, the Ameri¬
that we may hereafter direct all
By amendment filed with the SEC the
can people
must not be deluded of our international arrangements
preferred stock has been eliminated and

preferred on the
common ..Ur one

of. preferred.
Details—See issue of Jan. 17.

.

and

& Co.,

CO. •

cumulative

$20 par,

Offering—The offering price of the pre¬
ferred will be $10 per share.

be

to

for

reserved

are

share

requisite

shares

of

basis

prospectus

the

The

90.79%

constitute

offered

the

shares

shares

three
to be

GENERAL INSTRUMENT CORP. on O it

filed

conversion of the
of two shares of

upon

price

a

•

.•}

shares

shares

common

at

fe/v /•,/:A:'AAA
principal upderwrit-

amendment,

by

each

for

held

25 filed a registration

MANUFACTURING
CORP. on
a
registration statement for
of 60-cent cumulative con¬
vertible preferred stock, series A, par $8,
and 100,000 shares of common, par $1. The
11

share

one

common

Lazard Frere# .&

DOYLE

50,000

of

of

""■;vcY:

ding and the offering price will be filed
by amendment.
"
Underwriting—The names of the under¬
writers will be filed/ by amendment.

Jan.

definite

February, on

.

(no par).

outstanding

common

for

tige when the lack of

of1'

durable peace,

a

our

are

,

is offering the
stockholders
of

company

to

date to be set in

a

basis

shares

Offering—The shares are to be offered
by Crescent for 'sale at competitive bid¬
AMERICAN

stock

record of
the

22

Jan.

on

31. <:

of Jan.

issue

Details—See

on

INC.,

CO.;

GAIR

of Colorado Central y Underwriters—The
ers
are LaderfbuTg,
Crescent Pubjic. Service.,C,Q<
Thalmknn

Details—See

;

us..

to build

are

.

of

shares
by

lands

MStop the New Deal policy of'

registration statement for 410,481
common stock, par $1. ArA

a

what

sure

with any de-*
of certainty at any time. Stop
blaming our soldiers in foreign

the i

are

be

can

gree

borrowing and borrowing—spend-

The shares,

outstanding

we

■

heads the underwriting group,

filed

registration statement

a

v

principles

one

God-of decency mercy—and of common sense, if,an^
of

enemy

But

been

before

No

,

,

,

whose

plan,
on

Underwriters—E. H. Rollins & Sons, Inc.,

.

just

important question
definitelyv set¬
our
UNO delegation

have

foreign policies

said, we must
reverse our
policies m Germany
and abandon the evil Morgenthau

44,072

shares

CO.

T

to

meant.

left for London.

home of our soldiers.
.

na¬

cloudy

as

President

highly

tled

Morgenthau plan is pri¬
marily responsible—is preventing
the reconstruction of Europe and
the tranquilizing of the world. It
is costly to the
American tax¬
payers and prevents the sending
As I have often

clarification

the

should

workable

con¬

AAAA A A "A y-> A-AA A :K; ■:

what

our

so

own
party leaders—as
department officials are

seeking

political structure
Germany—for which, the un¬

of

state¬

public

the

to

of

breakdown

-

and

economic

shares of preferred and 44,072
shares of common will be filed by amend

shares of common stock, par $10
which are all of the issued and

43,750

price

Offering—The

new

POWER

CENTRAL

COLORADO

that

entire

The

Jan. 31..

Details—See issue of

the

Canada.

Ontario,

Toronto,

! DATES OF OFFERING

the

a

vital to

security—was
as

stock

preferred

ROBERT

&

registration

a

this question

on

tional

his

(par $25)
and
110,848 shares of common (par $10). ..Of
the common registered, 66,776 are reserved
for conversion of the preferred. \ / •

vertible

,

Manning

filed

22

44,072 shares of cumulative

for

is

price

,

R.

Underwriters—W.

whose registration

Feb.

on

failure

The War

State

sition of the Pacific Islands. Even
the President's recent statement

well

PAPER

CORRUGATED

WAYNE

FORT

policy of the

Departments
unable to agree asJto our pol¬
icies relating to the final dispo¬

that

present registration statement becom¬
ing effective.'

ment

the

and

to

draft

the

CO.

the

is

are

just and decent peace that
will preserve some of the prin¬
ciples of the Atlantic Charter.

winter—for

this

151,-

shares

subsidiaries of the registrant.
The
registrant is filing with the Commission a
post-effective amendment of former regis¬
tration statement, deregistering the 116,315
shares with the request that the amend¬
ment become effective simultaneously with

i

offering

the

116,315

arus,

ment.

Details—See

Of

common.

registered,

—Navy

Mor-

infamous

and

•

genthau plan is responsible for
keeping our armies of occupation
in Europe in such large numbers
for the colossal suffering and
avoidable loss of life in Europe

.

Deci-

on

to

previously registered and became ef¬
fective
Sept.
6,
1943, to be offered in
exchange for common stocks of Filene's,
Abraham & Straus, Bloomingdale and Laz¬

26 filed
a,
registration
statement
for
1,250,000
shares of $1 par value stock, non-assessable.

Form

Registration Statement No. 2-6153.

Lazarus

shares

cruel

The

were

■

>.i Underwriters—Emanuel

of

694.15

abroad

and

Truman administration.
Our Policy in Germany

%

Ab

common.

democratic

tion

a

unit of

at a price per

for

inaction
at
home and compromise and inac¬

shares, Federated
shares of Abraham &

Abraham

we

stand

our

Compromise

of Filene's

shares

that

result

losing

teriorate.

be

at

the

always get
dickers, with
are
steadily

liberalism in the world.

30,486

common,

of

to

is—we

accomplishing our purpose and
our own position will steadly de¬

156,725

stock,

trouble

the worst end of the

reverse some

I believe there is no chance of us

shares,
Federated
is
to receive
31,451 shares of Bloomingdale common, at
a
price per unit of lVb shares of Bloom¬
ingdale common. As to 3,584 shares, Fed¬
erated is to receive 3,259 shares of Lazarus
common at a price per unit of 10/11 of a

registration statement for 15,000 shares
of
4%
convertible preferred stock,
par

ICHESGO MINES, LTD.*

1%

compromiser.

immediately and
of our pol¬

we

icies, both foreign and domestic,

23,588

a

;

-■

receive

to

common

15,243

share

a

is

of

to

receive

Straus

utilized

of inventories.

purchase

unit
As

shares

94,035

to

As

Filene's

per

to

is

—

in

the

of

shares

..; AAA A A- *' AAAA&A ■■ A:AA $100, and 25,900 shares of common stock,
Company
and
subsidiaries par $1.
operate a chain of 45 retail stores selling
Details—See issue of Jan. 31.
women's clothing and accessories, etc..
Offering—Of the preferred stock, 10,000
Offering—The ' price to the public will
shares are being offered by the company
bevflled by amendment,
in exchange,
share for share, to holders
;
Proceeds—It is anticipated that $900,000
of its outstanding 4y2%
cumulative pre
will
be
used
to
replace working capital
ferred stock.
The remaining 5,000 shares
expended in the purchase of 50% of the
and
unexchanged preferred shares pur¬
capital stock of Robinson's Women's Ap¬
chased
by the underwriters
are
to be
parel, Inc., and $450,000 will be used to
Initially offered to the public at a price
prepay the company's 3%
note issued for to be filed by amendment.
Of the common
the purchase price of the remaining 50%
stock
registered, 5,000 shares are being
of the capital stock of that corporation.
offered by the company to certain of its
It is also anticipated $250,000 will be used
officers
and employees
at a price to be
to
replace
working capital expended in
filed by amendment.
Such shares are not
payment in part of the purchase price of
underwritten.
The remaining 20,900 shares
all of the
capital stock of S. Klein On
are
being offered by underwriters
at a
The Square, Inc., and of $800,000 of 20
price to; be filed by amendment.
year 8%
debentures of that corporation,
Underwriters — Kirkpatrick-Pettis
Co.,
and $2,250,000 in payment of the balance
Omaha, Neb., is named principal under¬
of the purchase price of such securities.
writer.
The balance of the proceeds will be

forthwith

exchange for common
Co., Abraham

Federated

offered,

N.Y.

Business

registered,

of Wm. Filene's Sons

Federated.

of

countries—Spain

The

But unless

i

Compromiser

a

Secretary of State Byrnes daily
adds to his reputation as the great

pan.

Straus, Inc., Bloomingdale Bros., Inc.,
F. and R. Lazarus & Co., subsidiaries

&

t rance

—

he Scandinavian

Jan;> 17.

securities

the

Byrnes

as rapidly as we
— the Netherlands—

picture,

—Italy—Germany—China and Ja¬

and

22.

CARPENTER PAPER CO. on Jan.

STORES,

>•

of

be offered in

to

are

stocks

share

par

common,

(Continued from page 873)

named

are

world

-

issue

Offering—Of

:>

William

Co.,

151,694.15 shares of common of Federated

principal underwriter.

named

convertible

cumulative

of

shares

preferred

stock, no par value.

the public is 30

price to

Offering—The

cents

Inc. of Cal.)
statement
for

Grayson
Shops
a
registration

filed

INC.

STORES,

Our International Policies

INC., on Jan. 10 filed a registration state¬
151,694.15 shares of common

stock,

1,000,000 shares of common

par $1.
;
Details—See issue of Nov.

at

ment covering

MINES,
registration state-

LTD., on Nov. 13 filed a

Company.

Registration Statement No. 2-6152.
8-1.;(2-11-46).

ol

can

GOLD

YELLOWKNIFE

CABOT

the

to

DEPARTMENT

FEDERATED

common.

group

&

Dillon

Eastman,

price

and

Co.,

seven

close

public

the

at

price

principal underwriters.

receive

will

held

at' a

share.

per

and

assenting to the ex¬
detachable war¬
rants entitling the holders up to April 1,
1955,
to
purchase 20 shares of $5 par
common per each $1,000 bond at the price
of $6,25 or $7.50 per share, depending upon
the date of deposit.
The first date on
which bonds may be deposited under the
extension offer will be Feb. 1, 1946, and
the extension offer will expire on March 1,
1946, or such later date as the company
may fix. .'Bonds which are not assented to
the extension offer are subject to redemp¬
tion on April 1, 1948, or earlier at the op¬
tion of the company, at $1,025 for each
$1,000 principal amount of bonds.
Underwriters—No underwriting.
also

9,

875

CHRONICLE

Underwriters—E. H. Rollins <fe Sons, Inc.,

:Ayjy^yr!

Underwriters—The
Is

normal

the

in

loans

business.

of

course

$12

of $5
$1,000 ex¬

share for each

one

common

Feb.

business

debt reduction,

each

per

of

shares

Those

bond. '

tension

road

work,

stock

common

tended

AAAAA

mixing

Concrete

—

•

■

the basis of

on

each $1,000

of

amount

payment therefor, 20 shares

without
par

Street,

<V

'

■:■ •'-.■

•

and to receive in considera¬

$900

to

of such extension and

tion

of

value.

par

Spring

West

O.

reg¬

a

shares

33,153

for

statement

bond

has filed

principal

the

of

SATURDAY, MARCH 2
MACHINE CO.

-

THE COMMERCIAL & FINANCIAL

Number 4464

Volume 163

JAEGER

H*

.

Co.,

Inc.,

New

is principal underwriter.

(This List Is Incomplete This Week)

Eleven

years
experience includes oper¬
department N. Y. S. E.
Operation
investment
counsel
firm.
Negotiated financings.
Developed
special situations. Exceptional ability as
analyst and
economist.
Degree in
fi¬

ation

statistical

firm.

nance.

&

Age

Financial
York

8.

33.

Box

Chronicle,
N.

Y.

F. 27

25

Commercial

Park

Place.

v.-H

THE COMMERCIAL & FINANCIAL CHRONICLE

Confusion Worse Confused
v,'■'

.'(Continued from page 831)

•

;V

'

Oxford case, rather than by direct rule, has not added
any
clarity; • but rather, /has; served only to ; confuse existing
regulations.
v.

New England Public Service
General Panel Units

]
of future./ business. and If the definition from the Act itself were given a wide
literal ..application, all securities transactions would
purchased for our own account a block of bonds have to be conducted on an
agency basis.
"
of that railroad.
A memo setting forth our findings
j
It must be clear that nothing of the sort was ever
was prepared and brought to the attention of our cusintended," and that this definition was meant to fit into the
tomers.
The bonds in question are listed.
Our own framework of
the existing trade customs and usages in the
bonds were not for sale at the then prevailing prices.
-securities business.
We took orders from clients, bought a like amount of
; I
That it should have seized upon this definition as a part
bonds on the New York Stock Exchange, added 3%. to
of the dicta in the Oxford case, demonstrates to us the weak¬
our cost and confirmed as brokers and showed the 3 %
ness of the
position of the SEC.
'
as 'our charges'.
Certainly no customer could or'did ;
That position has stirred the NASD and also the NSTA
rightly expect that we could furnish such service for into action/ It has created a ferment in the entire indus¬
$2.50 per $1,000 bond and then pay the $2.50 to a New
try.
Commissioner Caffrey saw fit to go to Chicago and
York Stock Exchange member. ...
:
■
/
>
make an off-the-record explanation which was, no doubt,
"The implication of the decision in the Oxford case
well intended, but which: only served to emphasize the
seems to be that everything would have been O.K. if the
disturbance. : /' :>
/ •
i. <;]
* ?; f> *
'
old gals had been gypped via proper phraseology.
Can
?
Now it is perfectly plain that only a statement from
we act as principal when we own securities which we
the Commission as a whole can serve to act as oil upon the
are not selling?
Can we act as agent when we have troubled waters. and

service

to

Then

v./v

^

Thursday, February 14, 1946

possible

Volume

Gaumont-British "A"

we

U. S.

;

;

-

Raiser-Frazer.
Mexican

J

of the securities in

some

our own

investment account?''

Cinema

ESTABLISHED
Members
40

1919

Security Dealers Ass'n

leletvne

f-

N.

Y.

HA. 2-8780

1-1397

^

iZ.A CEMENT COMPANY

Monolith Portland Midwest

:Pp8%

WHY IS THAT STATEMENT BEING WITHHELD?

see

pfd.

$10 par

—

Dividends: 20<k in 1944 and

1945;

'

,!

problem, he would call in counsel.
the Editor, Commercial and Financial Chronicle, 25 Park
If on the other hand, the "utterances of the NSTA were
Place, New York 8, N. Y.
f;
'
;*
"
/'
to be the criterion/the governing control would be the state¬
ment " /
the Traders Association is of the opinion that
Trading Markets in /
fundamentally the fair and honest business customs and

arrears

of Jan. 2,

as

—* $12.80

; 1946

All communications should be addressed to

this editorial.-

Y.

N.

Exchange PI., N. Y. S

1

what has happened since the decision in
ii
We are interested in getting the reaction of our readers
the Oxford case which may act as a guide.
to the excerpt quoted above from the letter of a dealer, as
If our correspondent were to accept the advice of the
well as their reaction to the whole problem presented by
National Association of Securities Dealers, and regard this
Well, let's

>•;'

Corp.

t

s

,v:

Finishing

Scophony, Ltd.

_

'

Rhodesian Selection

-

-

'

* •'

Present market 10 -11

his individual'

as

,

.

31'Milk Street, Boston 9,

Mass.

.

generations may not be changed.''
;
If the off-the-record remarks of Commissioner Caffrey
at Chicago were, to be the influencing force, then the writer
of the above letter would limit the area of application of the
Oxford decision to the Oxford, case only and other violations

Amalgamated Sugar

of similar type,

Bendix Home. Appliances

Majestic Radio & Television

relations built up over

Teletype

Hanover 2-7913

BS 328

jjnt'l Resist 6% Pfd. & Com

/'"/

•

New York

'.'•'t;

Hubbard 6442

Lear Inc.

Buckeye Incubator ~r -

Boston

■

t;

This of

I...

that every
he is

a

course

doesn't

J'

;

.

„

-,

„

and can't possibly

mean,

mean,

broker.

dealing FOR THE ACCOUNT of others.
p
.
Unfortunately,. the ;• attempt:- of • the Securities

TEXTILE SECURITIES

Sheraton Corporation

Telecoin Corporation

H

v-/:';'/''" /■/

4 5

New

York

NASSAU

telephone

Security

STREET,

philadelphia

2-3600
.

Foreign Securities

/ '

-

Dealers

Association

5

/

new york

1-576
A

potential postwar bene'
ficiary of the:
/
-

Automobile,

Herbrand Corporation

INC.

■:

'

/-

Vv4::X4?:X y'XXy4:

Building,

>:i=

/

Bought-—Sold—Quoted
'

-

/

.

:/ i

2-00S0

Industries.

New York 4, N.Y.

•

HAnover

AFFILIATE: CARL MARKS & CO. Inc.

;

and

Frozen Food

,

SPECIALISTS

50 Broad Street

Tele. BOston 21

.,

bell teletype

telephone

Enterprise 0015 /

.

Telephone

/// >

Established In 1922

v

:

,

YORK

NEW

|

FOREIGN SECURITIES

X

in

Unlisted Securities

STREET, BOSTON 10

r-'I '

INCORPORATED

Members

'

REctob

r.ARL MARKS &

Specialists

Tel. HANcock 8715

Kobbe, Gearhart & Company

in the

Market

Frederick C. Adams & Co.

Wilcox-Gay Corporation

,

and

New Eng.

a

^:

New England

/

markets

Public Utility Stocks and Bonds

24 FEDERAL

•

11

Investment Trust Issues

;

/

I v<

Exchange Commission, to snidely extend its powers

Industrial Issues
•

Securities with

.

Greater N. Y. Industries

one

We specialize in all'y .

,

Insurance and Bank Stocks

O'Sullivan Rubber v-

>

Globe Aircraft

has dealings with another in securities
The distinction lies in dealing WITH others

time

y

Du Mont Laboratories

'

y

Kut-Kwick Tool

Helicopter

Clyde Porcelain Steel

effecting transactions in

:

Kropp Forge

Bendix

v '

person engaged in the business of
securities for the account of others.

Ironrite Ironer Com. & Pfd.

Pfd,

Baltimore Porcelain Steel

\ 5,"*, *
' *
"/ T ' "
Now it is perfectly true that under the ."Exchange Act
1934,". Section 3 (a) (4), the term broker is defined as a

of

or

Artkraft Mfg. Com. &

CHICAGO ; :

HOIXRfiSESteTER

.

***
'

,

ESTABLISHED 1914

74 Trinity Place,
NEW ENGLAND

\'J'r

\

Only

Nlew York 6, N. Y.

Telephone-BOwling Green 9-7400

''

~

'

e'*:

fl(,

small issue of

a

com*

stock.

mon

Teletype: NY 1-375

***

Recent Price

.

i°^

.

^//■-^iyi ']-t:

New

Write

England Local Securities

call

i or

analysis.

for
'/

.

descriptive
•'

/

Specializing in Unlisted Securities

WALTER J. CONNOLLY & CO.
■

/.

;

-

INCORPORATED

1923

.

;

...

24 FEDERAL STREET, BOSTON 10, MASS.

5

Telephone Hubbard 3790

11 - H V

-

i

BANK

PUBLIC UTILITY

—

—

INSURANCE

INDUSTRIAL

—

|

:

.

REAL ESTATE

System Teletype BS-128

Vf

148
Tel.
v

State
CAP.

N.

Y.

St.,

0425

Boston 9, Mass.

:"

:

Telephone

Teletype BS 259
HAnover

2-7914 /

LUMBER & TIMBER
"

ACTIVE MARKETS

San-Nap-Pak

BONDS, PREFERRED AND COMMON STOCKS
;

Sunshine Consolidated

New Jersey Realty Co.

Pressurelube, Inc.
U, S.

BOUGHT

Automatic

Signal Co.

Telephone COrtlandt 7-0744
Bell

Teletype NY

1-886




QUOTED

Amos Treat & Co.
40

Wall St.

New York 5, N. Y.

BOwIing Green 9-4613

Susquehanna
Mills
H

REMER, MITCHELL « REITZEL, INC.
208 So. La Salle

TELEPRINTER
"WUX"

BELL

%

'v

■,

.

'

V-l-

Empire

St., Chicago 4

'RANdolph 3736
WESTERN UNION

New York 5

—

:;:

Van Dorn Iron Works

Byrndun Corp.
Broadway

SOLD

Central Iron & Steel

Radiator, Pfd.

Reiter-Foster Oil

120

—

Steel Corp.
*

::

SYSTEM TELETYPE
CG-889

Hill, Thompson & Co., Inc.
Markets and

120

Situations for Dealer*

Broadway, New York 6

Tel. REctor 2-2020

Tele. NY 1-2660