Full text of Commercial and Financial Chronicle : February 16, 1961, Vol. 193, No. 6030

View original document

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

The COMMERCIAL and FINANCIAL

ESTABLISHED

1839

Number

193

Volume

York

New

6030

AS WE SEE IT

Editorial
"It is

Reg. U. S. Pat. Office

clear that President

The Causes of

dynamic
and constructive policy as well as a program, and what
is equally important he has a will and determination to
carry them out," ex-President Truman dutifully and
perhaps pridefully remarked the other day, adding that
the prestige of the United States abroad is being re¬
stored, or words to that effect. It is evident enough, of
course, that the new President has a policy. It would
be much nearer the mark to say that he has many pro¬
grams and is not in the least hesitant about sending them
along to a somewhat reluctant Congress. Whether any
or all of these are "constructive" is a matter of opinion
which, we are certain, differs, often very sharply differs,
from that expressed by former President Truman. So
far as policy is concerned, it is clear as anything could
be at this time that President Kennedy has taken a leaf
now

from the notebook of Franklin

make his first

100

days

Kennedy has

Price

7, N. Y., Thursday, February 16, 1961

Gold Losses
of Devaluation

And the
By Dr. Arthur A. Smith,* Vice-President and Economist^

banker-economist

Texas

Smith

Dr.

believes

domestic

will

have

our

causing

If they are not checked,
to

reserve

abandoned,

em¬

lowered.

The

ratio

devaluation's probable

enumerates

banker
of

gold

devalued,

bargoed,

circumstances

contends

gold drain problem are avoidable.

results in terms

supply, price level, world's foreign ex¬

money

bonds, and real estate.

change rates, stocks and

He con-

cludingly warns there is no perfect hedge against inflation,
unrestrained money doctors for the threat to gold.

and blames

Roosevelt, and intends to

problem of major popular interest for several
months now has been the decline of our gold
A

occupied with his demands

reserves.

holdings

tactics

the

situation?

gold

our

gold

Total

fell
to $17,615 million as of Jan. 11,
1961, lowest since 1939.
How

A' la Roosevelt
were

critical

How

the

Franklin

Roosevelt,

tion

has since been
which President

and they gave birth, to what
labeled the New Deal. The situation by

Treasury

far

our

are

SECURITIES

afforded

note

since

gold

rest

Nov.

30,

1960,

Reserve

the

Banks

If
you
one

Dr. Arthur A. Smith

million, making

total of $45,-

complete picture of issues

now

HAnover 2-3700

STATE

Registration"

AND

all

stop and

nickel

traded

world

Securities Co.,
BROAD

New

COMPANY

most of

BONDS

York

Ltd.

Offices

dime

Office:

marbles, the game had

State,

Municipal

Street, Los Angeles 17,

Corona del

Claremont,

Nikko

Kasai

1-2759 U

FRANCISCO

Securities

OF NEW YORK

LOS

Co.

Bond Dept.

Agency
Bonds and
Notes

Mar,

Inquiries Invited

Southern

California Securities
Affiliate:
SAN

Teletype: NY 1-708

New

York Correspondent

—

Pershing * Ca.

ANGELES

THE

CHAS

MANHATTAN
BANK

Net
To

canadian

ESTABLISHED

1832

DEAXjHJR,

Members
New York Stock

Exchange
Exchange

Stock

BONDS & STOCKS

Block

American

CIVIC

Inquiries Invited

IMPROVEMENT

Commission Orders Executed On Ail
Canadian Exchanges
»
'

company

Teletype NY 1-2270

BROAD

STREET

NEW YORK 4, N.

DIRECT

•

WIRES TO

MUNICIPAL BOND

PERTH AMBOY

Grporatio?i

BANK OF AMERICA

MEMBERS NEW YORK STOCK EXCHANGE

2 BROADWAY
.

DEPARTMENT

tortiflioN Securities

MONTREAL AND TORONTO

Goodbody & Co.
•<

-.BRIDGEPORT

CALIFORNIA'S

CANADIAN DEPARTMENT

BONDS
FOR

CANADIAN

securities

T.L. WATSON &CO.

fcgsS

MUNICIPAL

Active Markets Maintained
Dealers, Banks and Brokers

UNDERWRITER

gouthwedt

HAnover 2-6000

••>:•••

FIRST

the

(Continued on page 22)

Riverside, San Diego, Santa Ana,
Santa Monica, Whittier

the FIRST NATIONAL CITY BANK

TOKYO

pay

bought from the winner,

Oceanside, Pasadena, Pomona, Redlands,

Teletype:

you

Encino, Glendale, Hollywood, Long Beach,

4, N. Y.

Telephone:

Head

New York 15

DISTRIBUTOR

So. Hope

something

Members Pacific Coast Exchange

30 Broad Street

have

knife, ball, or

Members New York Stock Exchange
Associate Member American Stock Exchange

STREET

DIgby 4-5881

V vy • -Ay.-.y-y.. y ..v.;/.-

would

you

Lester, Ryons & Co.
623

induce¬
the

29.

Section, starting on page

MUNICIPAL

buying our goods.|
you ever played marbles
"for keeps", when
were a boy, you will remember well that when
fellow became so good at marble playing that

California

The Nikko

BOND DEPARTMENT

the

That would be

to- set about getting it back, since

registered with the SEC and poten¬

SECURITIES

NEW YORK

played something else, going back
only after you and the other losers had
gotten possession of some more marbles. Rarely
did the winner show enough compassion to give
you back any marbles (and it would have taken
something out of the game, if he had), but you
bought some more at the store when you had a

to¬

930 million, against which 25% in gold certificate
reserves have to be kept.
Obviously only $11,482

worrying unnecessarily

to marbles

gether owned $18,058 million worth of gold certifi¬
reserves.
At that time, Federal Reserve note
liabilities amounted to $28,006 million and deposit

JAPANESE

Municipal

..........

won

cate

liabilities to $17,924

are

with when

is
12

gold position, It might be a good thing
to be distributed a little more widely

other nations.

ment for

held by the Treasury.
Federal

gold

among

and

itself

gold

the

our

Housing

CHEMICAL BANK

against deposits held by the Fed); so, since it is
man-made, it can be man-changed. And gold could
be embargoed.

and Public

Securities

••

requirement to 20%, or

reserve

Housing,

State and

TRUST

are

25%

tial undertakings in our "Securities in

U. S. Government,

telephone:

certificate

10%, or what have you.
It used to be higher (40% against Federal Re¬
serve
notes and 35%
in gold or lawful money
15%,

REGISTRATION—Underwriters, dealers and investors in corporate

NOW IN

securities

Public

the gold

deposit
liabilities combined.
These gold certificates are what
the Feds hold in lieu of actual

quite evident to the thoughtful
already placing their imprint upon

are

it will, but circumstances as yet do not compel it.
Furthermore, we could do other things—say, lower

for

says

day-to-day events. We suspect that they will be more
and more conspicuous as time passes.
In the first place, when Franklin Roosevelt entered
the White House in early March, 1933, the country had
passed through three or four years of the most devas¬
tating depression in its history, a depression which was
obviously the aftermath of the follies of the NineteenTwenties. Hardship and suffering
(Continued on page 24)

our gold supply could be reduced
billion or so without endangering
legal minimum behind our present quantity of
money.
Of course, such a reduction undoubtedly
would have a serious psychological effect.
The thought persists that some day the govern¬
ment will have to raise the price of gold, and maybe

words,

the

about

quite- far above legal minimum
reserve requirements.
The law

reserve

are

In other

by another $6V2

Playing the Gold Game

still

had to deal when he reached the White House in 1933.

and

certificate reserves were legally
time, but the system held $18,058
certificate reserves were 38.3%,

Maybe many of

that Federal Reserve Banks
must
keep a gold certificate

observer

gold

not 25%.

situa¬

money

concerned,

Kennedy is faced is, however, basically different in
many respects from that with which President Roosevelt
differences

bad is this?

course,

These

million

necessary at that
million. So gold

First National Bank in Dallas

for the rise of competitive leadership—or
at least.

These

Copy

that there will be little time for the formulation of rival

programs or
so he
hopes

Cents

1 NORTH LA SALLE ST.

NEW YORK

CHICAGO

N.T.&S.A.

Exchange Place, New York 5, K. Y.

Teletype NY

1-702-3

WHitekall 4-S161

SAN

FRANCISCO

•

LOS ANGELES

The Commercial and Financial Chronicle

(758)

For Banks,

Brokers, Dealers only

The Security I Like Best...
A continuous forum in which, each

Call "HANSEATIC"

range

Members: Midwest Stock

getting

■

possible coverage,
HANSEATIC."

the widest

"Call

New York Hanseatic

the

and

Member

Associate

120 Broadway, New

York 5

Teletype NY 1-40

WOrth 4-2300
BOSTON

•

CHICAGO

PHILADELPHIA

•

SAN FRANCISCO

Nationwide

hap-

turned

de¬

pressed relathe

W. Gene Gerard

price earnings

& CO.
Members

INC.

Dealers Ass'n

Security

Odd Lots

(To Brokers and Dealers)
—

★

—

Exchange Place, New York 5
Phone: WHitehall 3-7830

Teletype No.

small

NY 1-2762

the

Investment

appears to be an attractive
speculation
in
the $13 to $15
range.
The company has a low
capitalization
with only 92,631
shares outstanding.

after the war in
Amber N. Brunson's basement, the

mcve

and

sites

these

consolidate

opened
that

now

the

where

Kansas

City

VA.

LYNCHBURG,
LD 39

TWX LY 77

—5-2527—

Private Wire to New York

City

the

1958

suburbs

lines.

Boston.
In

become
ton

institutional
more

than tripled in

than

Sales

Per

with

/ i mi

recent

Rockets"

ness.

including the

1956___.

4.1

0.17

ment

are

dis¬

high

that

between

run

lion.

Assuming

the

ago.

LAMBORN & CO., Inc.
99

WALL

NEW

STREET

YORK 5, N. Y.

Defense

higher

De¬

sales

may

Brunson

are

For

expected

and

the

earnings

outstanding.

1961

sales

pected

and

9*w

—

Refined

—

about

missile launch¬
ing pads, and atomic installations.

are

for

1921

Liquid

Net

earnings
Earnings per share

per

industry

Dlgbj 4-2727

outstanding

(This is under
as

1959

$1,124,309
180,379

1935

circumstances

solicitation of

offer

be construed
any

107c

Shack

and

has

fiscal

„

Real Estate

of sales.
was

founded

Investments

been

and

has

served

that

post

N. Q. B.

since.

OVER-THE-COUNTER

and

Controller, who is 36. A Har¬
graduate, he
is concerned with corporate plan¬

1958

27,012
.

92,631

buy,

Cronin, Executive Vice-President

$0.29

-1,

92,631

ning, finance and general opera¬
tions.
In addition, the company
has

65,014
$0,70

61,131

offer

sell,

security referred to herein.)

many

with
and
;

In
sold

and

Underwriters

He is now 54.
Second in command is Timothy X.

232,977

—$0.56
•

Originators

and

trademarks.

continuously

$1,128,734

—50,000

•
.

Archer

16, N. Y.

•

INDUSTRIAL STOCK INDEX

vard Business School

80,000

92,631

New York

Deutschmann became President in

whole.

1960

120,000
$1.40

Companies

375 Fifth Avenue

continuously
run
since
by members
of the
Deutschmann
family.
Milton

recent

$800,000

$1,500,000250,000

Realistic,

close to

Radio

Radio Shack utilizes three main

19G1

Exports—Imports—Futures

and Affiliated

1960 the
private brand products accounted

ex¬

the

Altogether

fiscal

15%

least

submarine

profit

COMPANY

supplied by Amphenol-

Micronta

Beyond

rate of growth for the

Gross

REPUBLIC

segments of its busi¬
parts and equip¬

year

per

earnings

rise

which

year,

fleet,

full

to reach $17.0

$1.5 million. Present in¬
stallations include the "Polaris"

____

various

under

reach $1.10 on 584,651 shares

now

would be

gain

rate.

million

(Keuffel & Esser), direct defense
department
sales
for this
year

Sales

tion, the company engineers, de¬
signs and subcontracts the manu¬
facture of its own brand products

non¬

of about $0.11 in
the 1959 period. Sales in the sec¬
ond
quarter rose at a slightly

$3 and $4 mil¬

that

These results exclude

STATISTICS

SUGAR

FIRST
the

the first

recurring

split the mar¬
their major competitor

with

THE

year

fire.

the4 stock
of $17 to

able to continue to
ket

plant in

Borg,
Chicago Standard Trans¬
quarter of the cur¬
former, Hughes Aircraft, General
year through Sept. 30, 1960,
sales rose 33.7% and earnings per Electric, International Resistance,
R. C. A., Sprague Electric, Transhare
increased
from
$0.05
to
sitron and many others. In addi¬
$0.13, over the like quarter a
In

In 1960 sales

rent

partment spending in 1961
for
optical measurement devices alone
will

main

Electronics

the

Bay City, Mich.

—

made through

manufacturers

many

the

issue of "Missiles and

states

0.22

approximately $7*4.

^rT V
'SAVM&

Office

26, MICII.

distributes

Shack

Radio

0.12

year

Branch

stores.

5.6

because

from

retail

5.7

approximately $800,000
the company suffered a def¬

declined

WOodward .2-3855

Stamford and Hartford in connec
tion

1957___.

Exchange

and special flyers.
the

1958

Many

this

inherent

same

DETROIT

areas

equipment

are

de¬

share.

per

contributed

Exchange

Stock

Penobscot Building

Bos¬

the

Customers

Sales

addition

lines

icit, largely
During the

1051

Boston, industrial
sales
units are operated at New Haven,

Earnings

(Mil.)

Years to June 30

declined to

Members

Detroit

uptown

over

1956-1958.

average

sixfold

0.42

and

Midwest' Stock

than 10,009
whom have

England

in 1960)

pages

June
share have

ended

per

$1.03

existed at that time.

msm $

^
5

New

r<"><"••

salesmen,
by telephone
and through the mail through an
annual industrial catalogue
(290

9.2

earnings

Industries
ri

outside

year

Earnings

increased
its

the

'in

30, 1960.

jointed four plant operation that

^ '"Of

many

agencies.

in¬

and

$12.6

inefficiency

electronic

fidelity components to

1959

SOLD

IMORELAND & GO.

include
electronics
manufacturing
con¬
cerns,
schools, research and de¬
velopment
laooratories,
firms

about 14%

grown

1960

crease

the

division

concentrated

and

con¬

ings fell to 290

sells electronic parts and

customers,

distribution,

...

equipment

recently

—

Chemical

Detrex

receive

Avenue

industrial

its

tinued at the same level but earn¬

factors

BOUGHT

their operations and governmental

million

sales of

sales

1959

one

using

high

Sales have

loss and have since been dis¬

should

stores

Commonwealth

the last four years, reaching $12.6

Profits were cut to
some extent by a line of survey¬
ing instruments which were sold
continued.

and

Stamford

Haven,

overnight delivery service from
the -company's
large warehouse

in the last 10 years.
Shack is a large, rapidly

industrial,

$1,128,734.

All

6, N. Y.

Telephone: BEekman 3-3622-3

and" Hartford,
Conn.
Most are
large, semi self-service units fea¬
turing the entire electronic parts,
consumer record and high-fidelity

dividual customers.

company

700 per share

New

OFFICE:

YORK

present stores

Boston

growing distributor of a wide line
and equipment

have 175,000 square
in which to carry on
tneir precise operations.
During

Two

year

per

of electronic parts

year

Radio

they

earned

NEW

149 Broadway, New York

and

per

home 75 feet be¬

new

plans

years.

has

which

feet of space

COMPANY, Inc.

each

ExchdHge,'

has

D A I WA
Securities Co.9 Ltd,

operates five retail

recent

one

vibration-free limestone

in their

located

are

Exchange

electronics

consumer

present and
about two stores

in the future.

public investors is

contacted

are

open

Corporation
which

field

SECURITIES

promotional

company

Shack

Radio

branch offices

our

JAPANESE

and hobby¬

annual

Radio Shack

Starting just

neath

STRADER and

Stock

Customers

stores

Members: New York Stock Exchange,

Midwest Stock

NY 1-1557

Mobile, Ala.
Direct wires to

and addressing system in the in¬
dustry.

Analyst, Granbery,

American

and

flyers. At its
headquarters the company
believes it has the best designed
and most efficient name gathering

state

every

experimenters

other

se¬

Marache & Co., New York City

the central plant was struck
by fire. Although this hampered
operations, at the time, they are

Commonwealth Natural Gas

this

HAnover 2-0700

New Orleans, La. - Birmingham, Ala

company-

Boston

and will¬

inherent

seems

the

catalogue (192 pages in 1960) and

HUGH D. STIER, JR.

cave,

Life Insurance Co. of Va.

through

curity.

stock

Bassett Furniture Industries

ists.

current income for
long-term growth potential

which

in 10 years to four
plants
locations in the Kansas
City area. In 1960 after deciding

American Furniture

tronic

ing to forego

company grew

Trading Interest In

risks

company

division

In its

technicians, radio amateurs, radio
and
television
servicemen, elec¬

Company

the

afford

growth

industrial.

ana

foreign lands in fiscal 1960.
Sales are made primarily to highfidelity enthusiasts, engineers and

shares to those individu¬

able

als

coming year are estimated to be
$1.5 million, an 88% increase over
1960.
Earnings
on
those
sales
should be between $110,000 and

19 Rector St., New York 6, N. Y.

distribution:";mail

many

million, the com¬

Instrument

Brunson

common

$130,000;
$1.29
and
$1.50
per
share.
With a projected multiple
of
15
to 20 times earnings, the

BONDS
Bids

just under 10 times the estimated
earnings for 1961. Sales for the

GROSSMAN

"glamour stocks".

Selling below $13, it is currently

S.WEINBERG,

other

ratios

Steiner, Rouse & Co.

nearly 250,000 shipments ta

customers

could earn approximately
$1.40 per share in 1961. The new
plant site, consolidated operations,
increased sales, and the insurance
recovery should do much to re¬
verse
the deficit experienced in
1960.
I recommend the purchase

stock

tive

claims have

order

made

pany

on.

appears

losses.

sales of $1.5

"heat"

the

mail

yet been filed because the extent
of the loss is not presently de¬
terminable.
It is estimated that

when

pens

its

order, retail

is covered by business
interruption insurance and should
be at least partially reimbursed
for

B o ught-—S old—Q noted

Members American Stock Exchange

channels

company

the

■<

Hugh

—

Members New York Stock Exchange

non-recurring income
be forthcoming since the

should

Corporation

Stier, Jr., Investment An¬
alyst, Granbery, Marache & Co.,
New York City. (Page 2)

specialized devices, there is
a great need for it.
Almost every¬
thing in missile construction and
guidance depends on optics."
Some

Shack

Louisiana Securities

Company—

Brunson,

Amber

Mr.

Instrument

Gene

Radio

other

finding

This

Wire System

Private

varia¬

out what

Stock Exchange

ex¬

industry is an old one, but
there has been only a limited use
for
it.
Now
with missiles and

tra¬

company

"Our

missile's shell,

1920

addition, the

words

Company

jectory of a
missile, re¬
cording the
tions

Corporation
American

(Assoc.)

Exchange

aid in control-'

minute

Established

Exchange;

is a
firm
supplying the missile and
atomics
industries
with
precise
optical measurement devices which

ling

Alabama &

Gerard, of White
Co., St. Louis, Mo. (Page 2)

panding fully its exploration of all
applications of optical tooling in¬
struments
to
industry.
In the

„

Brunson Instrument Company

you re

sure

Stock

American

nation¬

our

wide wire system.
To make

St. Louis, Mo.

Brunson instrument

Contacts through

W. GENE GERARD

T rigger-quick service and
broad

Brunson
W.

W hite & Co.,

Participants and

Their Selections

security.

participate and give their reasons for favoring a particular

department offers

different group of experts

Thursday, February 16, 1961

advisory field from all sections of the country

in the investment and

Our experienced trading

reaches

week,

Week's

This

Forum

other

talented

merchandising,

23-Year

people

electronics

FOLDER
*

engineering backgrounds. '
October, 1960, the company
150,000 common shares and

selling

stockholders

sold

Continued

50,000

on page

Performance

35 Industrial Stocks

REQUEST

•

National Quotation Bureau
Incorporated

46 Front Street

„.

" "

New York 4, N.

;

Volume

193

Number

6030

The Commercial and Financial Chronicle

(759)

The Outlook for Business

CONTENTS

And the Stock MarketE
By Julian D. Weiss,* President, First Investment Company, Inc.,
Los Angeles, Calif.

The

mended

Mr.

Weiss

his

concludes

industry

groups

forecast for

and

The Outlook for Business and the
—Julian

expected

1961

with

list

-'.V':";-"

—Ira

that,

while

cast

crease

from

time

time.

said:

once

"Among all forms

.gratuitous."

Actually,

Subject to this

worked

limitation, it's

With

1960

out

interest-

ket,

year ago,

present

the

time

;

*r'_

a n

market

that

there

Julian

even

where

and

are

cases

"(3)

Weiss

conclusions

selling

Portfolios

■

should

•

•getting into
reference

any

undergoing
it

business

recently.

disputation'with
it

does

T+,

but

bonds

* J?
ba®'s'

that

softening in

some

number

the

lead

are

would

on an

l^?s
Pccts

somewhere

the

have

May

June

get

and

the
and

on
we

(a)

evaluate:

can

where

„

very

well
,

as-

a§
as,

for

private

gross

1959
peak
of
totalled around

$72
$73

■

billion to $503 billion.

p0™6 w^j a

Na-

iggl

take

place

about

$21

1^1^1

(These

Nineteen

hundred

and

expectations expressed
by most forecasters at the start of

about

the year.
I'm

state that

1%.

The

auto

Dealer-Broker Investment Recommendations

have

specialized in

From Washington Ahead of the

Mutual

Continued

page

PREFERRED STOCKS

CAPITAL, LTD.
Observations—A.

Wilfred

Our

Spencer Xrask & Co.
Founded

1868

Governments.

Reporter

Utility

ST., NEW YORK 4, N. Y.

TELEPHONE HAnover 24300

Securities

TELETYPE NY 1-5

Newark

Chicago
Schenectady

J.F.Reilly&Co.,Inc.

39
29

Broadway, New York 5

DIgby 4-4970
Prospective

Security

Salesman's

The Market

Offerings.—-^

and

Corner

___;

You—By Wallace Streete___

The Security I Like Best___„_

The State of Trade and Industry

Tax-Exempt Bond Market—Donald D. Mackey

Washington and You

Glena Fall*
Worcester

Chemical

FINANCIAL

Park

Weekly

CHRONICLE

DANA

COMPANY,

Place, New York 7,

REctor 2-9570 to
CLAUDE

WILLIAM

Company
:

Publisher
N.

SEIBERT,

second-class

matter Febru¬

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

Subscription Rates
Subscriptions in

Possessions,

the

United States, U. S.
and
Members
of

Territories

Pan-American

Treasurer

MORRISSEY,

25,

9576

SEIBERT, President

DANA

Reentered
ary

Editor

Union, $65.00 per year; in
Dominion
of
Canada,
$68.00
per
year;
Other Countries, $72.00
per year.

m V. FRANKEL & CO.
'

INCORPORATED

Thursday, February 16, 1961
Thursday (general news and ad¬
vertising issue) and every Monday (com¬
plete statistical issue — market quotation
corporation news,
city news, etc.) •

bank

clearings,

state and

Other

Chicago

Office:. 135

111.

South

(Telephone

Bank

Salle

St.,

2-0613).

and

$45.00 per

rate

Quotation

year.

Note—On
the

STate

Other Publications

Every

records,

Nashville

Securities Now in Registration

GEORGE

Members New York Stock Exchange

May.

Reg. U. S. Patent Office

Boston

ETS HOKIN GALVIN

ELECTRONICS INTL.

Funds

The COMMERCIAL and

Albany

CORP.

News About Banks and Bankers

BROAD

PNEUMODYNAMICS

News—Carlisle Bargeron____ 13

Indications of Current Business Activity.

WILLIAM

"Einzig: "Dollar Defense Measures Fall Short of Objectives".- 11

Published Twice

For many years we

LIVINGSTON OIL

industry

turned in a very good year with
total sales up very nicely to
around 6.7 million units. Plant

did
not
share these very
optimistic
expectations. Among other things,
our
forecast of January 1960 inglad

»U

Coming Events in the Investment Field

figures for the

respective years.) Unemployment
was up very slightly to around 3 9
million persons, compared with.
million the year before. Consumer prices were stable and were
UP relatively m minor degree,, say,

sixty

disappointing year,
However, this largely is in relation to the over-optimistic forecasts

Bookshelf

mlhion the year before,
are average

•

proved to be

l/ut,

Farm in-

shade higher at $34.1

bdl10n* Employment averaged
66^5 million persons, compared

basis of estimating

likely to

was

billion to $404 billion

(b) the implications thereof and
analysis of probable trends in the
private and public sectors of the
is

Cover

was

of individuals

(and

decline)

economy

;

St. Louis

Public

(4) Gross National Product

the

what

(Editorial)

Dallas

Philadelphia

FOTOCHROME INC.

,™e

other

ag0>

V up $21

today

Cleveland

San Francisco

•

sectors of the

the causal factors that entered into

are

Direct Wires

Businessman's

•

tional income was up $18 billion
to $418 billion.
Personal income

See

inc.

40 Exchange Place, N. Y.

Teletype NY 1-1825 & 14844

Bank and Insurance Stocks..

(3) Net exports increased subgtantially as we predicted a year.

econ-

comprehensive basis

mackie,

billion,

comment

overall view of the

omy

1960

passed

unrelated data. Rather, it is to

that

As We

investment slightly sur-

billion,

statistics

domestic

objective is not to present

mass

snaped up ve y we

.'(2)

fallen

Los Angeles

billion to $328 billion.

period of 1960.
Our

ron

performance

shaDed

Tax Reform Measures

Regular Features

request

Singer, Bean

Long Look Ahead

Perry Shorts-___________

Chicago

examP •
(1) Personal consumption expenditures jumped by about $14

overall basis

appear

•

Performance
,

favorable

general, to the degree that a high
point could be alluded to as a
previous peak,

year's

Supply
Taliey Instruments
*Prospectus

good
(particularly

™
but

pointing downward.
Some indicators peaked out in the
January-June
1960
period.
In

Last

U. S. Photo

w
important to see what actuaI1>' did take Place in 1960 before

has been

economv

Activity—Allyn P. Evans

Michael W. McCarthy, President of Merrill
Lynch, Urges

convertible-bonds where obtain-"

picture, particularly

indicators

points

question

there has been
the

the

reaZtment

has been

There

that

semantics,

»that the

'tha^

'recession,

indicate

definitely

•

Photo Service*

HA 2-9000

bonds for investors jn the higher
tax brackets.

evidence

been

others

that

White Shield

Stimulants
10

80 Years in America and
—R;

;

not

while

Alside

or ^
•

recessionary t characteristics that
are
gaining iff strength. Wiithout

have

claim

Stabilizers and

•

been.'able, reasonably close to a money

have

economists

Obsolete Securities
Dept.
STREET, NEW YORK
Telephone: WHitehall 4-6551
WALL

Stock Market Margins Must Be
Brought Up to Date

market basis) and defensive-type
' comm°n stocks as, for example,
pubhc utilities. There is a
sound basis for buymg municipal

Many

G. Keith Funston

balanced position, with

to where *

them

Policy Threat
'9

The Coming Resurgence in Business

1959.

our

are

out-''backlog, of

only with regard to the

look for 1961 but

and Federal

McKinley-

mar¬

times earnings.

disagreement between economists,

•

below

the stock

follows:

"(1)

considerable
not

stated

,:many

quite apparent

bid

—Roger W. Babson__

"(2) Caution must be exercised, ;
particularly in the area of pur-^
chasing 'romance stocks' which inf

coming

; yea r.-

shade

—Gordon

Our Immunity

r...

outlook for

the

Brittle Metal

all!

probably

This is not a time to ag¬
gressively increase risk by buying
speculative equities. '<

to evaluate the

business

profits

reference to

very
n

Cobleigh_______

Housing, Mortgage Outlook

increase

the

share the belief that there would
be a material increase in profits.

comfortably,

in costs would quite fully offset
this, and therefore we did not

for

'•

George

mistake

prophecy
t h

-■1V

dicated

However, it is necessary to fore-

Stock Market

Weiss__i

Beryllium—Bright Future

corporate '
volume could be expected to in-

issues he favors.

Forecasting is fraught with peril,

Eliot

_____Cover

WILD-DOG

probably greater than they have been at any time in recent

months.

COMPANY

WILDCAT

Devaluation—Arthur A. Smith

____

are

AND

Page

Causes of Our Gold Losses and the
Problem

of
.

selectivity and defensive position in municipals and

utility equities for the short-term wherein market risks

LlCHTfUSTEM

B.S.

Articles and News

Scrutiny of likely changes in the components of GNP adds up to a
prediction of continued short-term moderately downward drift followed by upward trend in 1961. Stocks for the
long-term are recom¬
*

Record

(Foreign

account

the

Monthly
Postage extra.)

BROADWAY, NEW YORK 8

—

fluctuations

foreign

exchange,
remittances
for
subscriptions
and
advertisements

must be

made in New

York funds.

WHitehall 3-6633

Teletype NY 1-4040 & 1-3540

The Commercial and Financial Chronicle

(760)

out

the technical

has

gress

standpoint.

"Just How

$64-question,

current

our New Fron¬
supplied via this
week's economic intra - national

Welfare-ish

tiersmen?"

are

participated

Meeting,

Summit

by the President, with the VicePresident and three other Cabinet

members; foregathered here with
a
group
of
industrial
leaders.
Monday's (Feb. 13) all-day pro¬

arranged

ceedings

National

Industrial

the

Board, took the form of a roundrobin, in which our new Adminis¬
leaders
fully
discussed,

question

full

answer

preliminary
phi¬

their
and

intervals,
programs

and

underlying

extra

urgency

zest

conferred

was

and

measure

the

strained

the front
page of a daily financial news¬
paper of a Washington datelined
story to the effect that govern¬
mental price and wage controls
are
in the offing. (Promptly de¬
nied at the meeting by Secretary
of Labor Goldberg.)
:
Our
"net"
impression was of
appearance

tion

ranging from Secretary Ribiadvanced
welfaring
in

coff's

education

They

state

Goldberg's almost

equally advanced Frontiering, and
V.-P. Lyndon Johnson's pre-1964

rehashing of doctrinaire New and
Deal-ism

Fair

appreciation
national
the

and

other

the

Rusk

Secretaries

hand;
Hodge's

one

and

free enterprise,
international,
on

approach

the

with

—

President giving a strong impres¬
sion

This

standing-in-the-middle.
appraisal of Mr. Kennedy's

present attitude is substantiated
by the impression, derived from
off-the-record
opinions of Fed¬
eral Reserve officials, as well as
his recent press conferences; of an
extended

honeymoon period of
non-interference by the Executive
with monetary and credit man¬
agement.

Significant Expressions

Here

some

are

the

key

thoughts as respectively expressed
at the Conference, including our
paraphrasing of impromptu state¬
ments made during the question
periods (excepting the President
and

Vice-President

who

did

Health,

the

Under

Education,

Mr. L. A. Nestingen

his

The

own

health's

Federal

Secretary
and

Welfare,

(pinch-hitting

Ribicoff

Health-Boss

for

By Secretary of Labor Goldberg.
The government must

extend un¬

relief funds to the
states in the form of gifts in lieu
of repaying debt financing. The
unemployment tax base must be
employment

deficiteering
is
justified in slow times. The mini¬
mum

impairment).

Government

need. Financing
to

must be increased.

Foreign aid cannot be curtailed.

Vice

"More

President

Welfare"

decried

are

Johnson.

and "Planning"
conservatives as

"dirty words." Actually, we are in
permanent New Era of govern¬

direction.

mental

The

country

Pockets

composed

Poverty

along with Pockets of Prosperity.
There
are
too
many
children
overcrowding

and

streets

our

classrooms.
The

existence

of Recession is
in fear of govern¬

denied

being

crucially

ment intervention.

Secretary

National

State

development

,commodity.

exportable

Rusk.
not

The

re¬

cipients of aid must join in the
helping. Latin American countries
must

themselves more, in
lieu of dependence on us.
The
private
investor
abroad
must be better protected. Also, the
help

government must put new energy
into helping businessmen develop
trade opportunities.

additional

In the case of Secretary of Com¬
merce

Hodges, it

velopment
than

any

through de¬
atmosphere rather
was

specific statements that

implies his free enterprise-ism.
the

case

and

wage

fixing

earlier

voiced

PRESIDENT

The

denial

plans,
the

price

although
by

program

(his) Secretary Goldberg, realis¬
tically must be credited to the
President himself.
To

provide

industrial

will

additional stimulus
plant

promptly

replacement,

propose

to the

(presumably, accelerated depreci¬
ation in some form) to expand in¬
vestment in plant and equipment.

—The Need for

Legislation

"Very few people really
what the conflict-of-interest
ute

really

means.

know
stat¬

If it is carried

Robert

McNamara, then Secretary of De¬

before the

fense-Designate,
We

Conflict

the

which

situation

the

that

suggest

thus

mess

Sen¬

Services.

ate Committee on Armed

Interest

mired,

must

definitive and comprehensive

new

this

And

statute.

should

rec¬

financial legislation,
apart from other qualifying tests,
ognized

and

devised

uniform

for

application.

aim

Barn Door

the still
barn¬
companies

repair
loop-hole,

outstanding

which .exempts

door,

securities

whose

markets,

that

apply

widely believed that such
successfully resisted
over
the years by the far-flung
and thus politically "articulate,"
will now be legislated—and for
the following reasons:
Former

Senator

Allen

Frear, framer of the would-be ef¬

fectuating bill bearing his name,
sponsored since 1947, is a Ken¬
nedy appointee to the SEC. '
Mr. Landis, the President's
adviser and working expert on

(2)

regulatory agencies, reversing

The

ing as SEC Chairman, now in his
widely published report advocates
such
extension
of
power
(with

the

Foreign

Securities Company's 1961

proxy-

soliciting

statement.

This

investing

closed - end
owning a generally di¬
portfolio — but with

company,

and listed,
versified

restrictions.)

Such prospect of effective legis¬
lation

still believe to

there

been

has

lack

support by the Commission in the
past.

has

Commission

The

been

The

advocating such legislation over
the past 15 years, supported by ma¬
jor studies made in 1955 and 1956,

proxy statement will show that
the
holding which
the
Senate

its

companies

total

assets

oil

stocks.

common

Finance Committee has permitted

Secretary of the

new

Treas¬

Frear,

as a

Senator and

even some¬

time Chairman of the subcommit¬

ury
to • retain totals
273,000
shares, having a market value of
$8
million;
that
his
father,
Clarence
Dillon,
is
a
director,

tee handling

owning 68,000 shares, which have
a
market value of about $2,000,000; and that his sister Dorothy

ing been most willing-but-unsuc¬

Dillon

other will do the trick.

with

Spivak is another director

583,930,800

$17,300,000

—

tributing to
terest

38%

the

out¬

shares,

with
a
total
market value of $38,000,000.
Our

point is not that the Treas¬
ury
Secretary's key position in
recommending tax policy regard¬
ing the now favored tax position
of the oil industry might consti¬
tute

real

conflict

interest,

(although Economic
Chairman

sharp

allowance

merely

has

Heller

reduction

oil

would

depletion

and

point

gas).

Committee

him

investment.

(Reading of the Sen¬

ate

Committee

Committee's

sion

the

this

keep

record

If the Task Force

indicates

company's

nature.)

now

Federal

controversy, via
posed
for

Foreign

engaged with the Treasury

sizeable

income

notice of

assessment for back

which

the

tax
pro¬

taxes,

recently
$8,600,000 reserve. While

set up an

going into the

should

back

with strong

strongly
does

conclusions, and more

and

Mr.

remedial action

such

unequivocally

Landis,

this

than

would

Reform

fund

mutual

IN THE

BREAK

FUNDS

FRONT
inherent

abuses

management

com¬

industry's leaders).

company

The Lazard Fund and its affili¬
ated

manager,

the

investment

stockholder's

com¬

plaint alleges among other things
that

the

investment

advisory fee

between the two, is

such

present

might

course,

implication
is

his

status

but
S.

and

*11

New York Stock Exchange •

LOS ANGELES

NEW YORK

44 Offices Serving Investors

was

unfair in that

not

the

result

bargaining; that
there has been trading in Lazard
Fund's portfolio securities which
arms-length

pro¬

put

providing for a sliding
fees, replacing the pres¬

ent

quarterly rate of Vs of 1%
quarterly, or % of 1% annually,
the

total

net

assets; with a
computed,
on
an
annual basis, as follows: V2 of 1%

sliding

scale

of the first

assets;

$100,000,000 of the net
of 1% of the next

3/32

$50,000,000; and 1/16 of 1% of the
over $50,000,000.
Interestingly, a partner

excess

firm

which

the

legal

licly

advocated, as. a quite min¬
voice in the industry, the
equity of just such sliding-scale
ority

arrangement.
Repercussion
The

amount

dollar

saving

involved in the Lazard revision is
small. But with the thus
open

top

instigated

invitation to sue, coming on
or so similar suits

of the' 25

already pending, the pressure for
the sliding-scale reduction tech¬
nique may well become irresist¬
ible.

While

this

will

inure

erally,

the

potential

damage
pricing of the
once
so
popular
publicly-held
management company securities,
the

market's

obvious.
In

its

legislative, as well as fi¬
impact, the present action
portentous
(despite the fact

nancial
is

these

defendants

innocent

wrong¬

fund

shareholders

cerned

with

those

outside

which

are

the

will

abuses,
of

fee-charging,

greatly

intensified
profit pressured publiclyso

held management units.

With Nat'l Sees. Research
William

MacDonald has joined
&
Research

Securities

Corporation

wholesale repre¬

sentative in the states of Connect¬

Rhode

Island

and

parts

dent.
In

his

new

position, Mr. Mac-

Donald will work under Ira
Jones,

Vice-President
New

charge

England territory.

individual,

SEC

•

its

Northeastern states.

wholesaler

ESTABLISHED 1894E

STATE AND MUNICIPAL BONDS
CORPORATE BONDS
LOCAL STOCKS

CHICAGO

Federal

securities

regulation to the vast unlisted
area

market), for

long

issue,

number

discussion

one

will

hyperbe

item

The

Robinson-Humphrey Company,Inc.

►

se¬

(the over-the-coun¬

controversial

the
on

RHODES-HAVERTY BLDG.

prominent investment

defying

REGULATION?

the

Mr. MacDonald has been associ¬
a

to the government

Massachusetts, it was announced
by Henry J. Simonson, Jr., Presi¬

Securities

exemplifying the diffi¬

con¬

including

Foreign

are,

any

doing). For by itself, and in set¬
ting-off
additional
law
suits,
greatly enlarged attention of the
public as well as the millions of

Lazard

the

benefit of Fund shareholders gen¬

company

that

the

counsel

for the Fund has in the past pub¬

ated with

shareholders;

provides

Fund

scale

has been harmful to the Fund and

avoiding it.

curities

•

contract

suggesting

Extension of

ter
•

conflict

Pacific Coast Stock Exchange

Private leased radiotelegraph
circuit to Honolulu

SAN FRANCISCO

Secretary

the

WHAT'S AHEAD FOR NEW

Members

Midwest Stock Exchange • American Stock Exchange
Honolulu Stock Exchange • Chicago Board of Trade
and other leading commodity exchanges
'

and

the

that

merely

culty attached

Sc Co.

under

statute,

suggesting

are

harboring

interest;

situation

inconsistent

con¬

excite

Dillon

•

direct

the interest of the
"conflict-of-interest" watch dogs.

WWWM-

the

icut,

The

and

distrac¬

and

controversy,"

proposed settlement and compro¬
mise
of
a
public
stockholder's
suit.

ren¬

that Lazard Freres agrees to enter
into a new advisory concert with

National

Service,
the

Secretary has

litigation

banking firm Lazard Freres, both
so
highly
respected
leaders in
their
fields, have agreed on a

law

the

and

burdensome

all

course,

paid by the Fund to the interlock¬
ing managers pursuant to contract

We,

Dean Witter

rest

that

MAJOR

services

Effected

Cut

expense

tracted

nection with the Internal Revenue

UNDERWRITERS * BROKERS • DEALERS • DISTRIBUTORS

tion

effective, though not by any
means politically conclusive.

commis¬

which the Fund and the managers
have agreed "in order to avoid
further

the

one

overall securities regulation status

miscomprehen¬

investing

from

panies' set-ups, in the face of the

permitting

the

transfer

snagging in the courts of the
SEC's past efforts, may well be
revived now
by a most timely
and surprising event (termed ac¬
tually "astounding" by one of the

nevertheless

in¬

consistency displayed by the Sen¬
ate

view

the

out

the

cessful, it is not evident how Mr.
Frear's

advocated

the

Hence,

the fact that both the bodies hav¬

Advisers

such legislation, has
in
getting- it

unsuccessful

through.

worth

these holdings con¬
the total family in¬

about

standing

shares,

been

paid

brokers

brokerage

joint stipulation of settle¬
ment and compromise (which is
being submitted to the Court) to

with its latest major Congressional
offensive occurring in 1958. Mr.

36.3%

has

other

The

be quite

questionable. We must remember
that

those

securities,

Freres
to

sums

cus¬

with

transactions

portfolio

Lazard

Fee
,

coverage,

(1)

sions for unspecified
dered solely to it.

that

out

from

those companies
on exchanges.

listed

are

Fund

substantial

his former attitude when function¬

the

Complete Investment Service

and

the

the investor with the
protections in reporting, proxy
solicitation and "insider" trading,

which

execution

Lazard

dealt in

are

over-the-counter

the

bution

commission
at
the
rates in connection

tomary
the

substantial

received

from Lazard Fund in brok¬

sums

Inconsistency at the Treasury

present inconsistencies and
general
difficulties
under
the
present statutes, will, or should,
be
highlighted during the latter
part of this week with the distri¬

has

Freres

erage

enactment of a

by the

Furthermore,

"CONFLICT-OF-INTEREST"

•

nomination

the

our

must

should he by con¬
states
by
the

the

This

apt • conclusion
was
voiced
by
Senator Henry
Jackson during the recent hearing
'

Budget

wage

regula¬

V affording

and hold securities."

business

because

"do the trick ." Federally financed
education
represents
a
crying
tribution

thing.

same

Congress a new tax incentive plan

participate).
From

and the

one

KENNEDY.

The

activity.

economic

are

from

Government

into

come

can

remedied

health, along with

and

Labor Secretary

by the

stimulus

chameleon-like ideological colora¬

(financial, but not

demands of un¬
employment?"): Government can
do
both.
Helping
welfare
also
cures
unemployment,
through

meetings by reason of the simul¬
taneous

which would

educational, he insisted).
(Answering the broad question,
"How can you justify generally
increased
welfare
outlays when
the
Federal
budget
is
being

raised.

losophies.
An

control

retain

Conference

tration

with

Federal Government,

Thursday, February 16, 1961

Taditional
The

Con¬

obligation to

clearly and in unequivocal terms
the conditions under which people

WA S HJN GTO N—Exceptionally
good
clues for answering tnac

Administration's

new

WILFRED MAY

tory docket.

literally, why, we could be in
of trouble with people
who
are
completely honest but
who would be in violation from

OBSERVATIONS...
BY

the

all 'kinds

ATLANTA 3, GEORGIA

JAckson 1-0316

the

Volume

Number 6030

193

The Commercial and Financial Chronicle

Steel

Production

Electric

Retail

Trade

Food

Auto

TRADE and INDUSTRY

Price

Production

Business

Index

Failures

index

—'

The

country

confronts

1961:

recession

"the

eenn«m,c

key

week ended Feb.

balance-of-payments<

our

week Ended

deficit with the rest of the world,
and the vital
on Art n m 1 n

Federal

Reserve

irtn

rtvAt

economic

growth,"

Bank

the

New

„r

sponding 196# Week

•

5% ahead of the volume for
previous week.

even

These findings

for

taled 497,630

of American Railroads announced,
ing presents
This was a decrease of 90,351 cars
Production
for (week
ending, or 15.4% below the corresponding
Feb. 11, 1961 was 1,524,000 tons
week in 1960, and a decrease 01
(*81.8%) a 2.1% gain over previ- 68,122 cars or 12.0% below the
ous
week's
output of
1,492,000 corresponding week in 1959.

,—(000s omitted—,

Feb- n—

1961

1960

2II

.33.1

Philadelphia

921,000

786,000

Boston

711,369,

tons
"

692,069 + 2.8

«
.«

•

.11

Loadings

week

the

fleets

this

year

handled

tonnage

than 400 truck terminals
carriers

the

Sneral

com-

freight

throughout the country.
Compared
to
the
preceding
week, 32 metropolitan areas regjstered tonnage gains while only

of Feb.

Production

based

partment of Research and Transport Economics.
The I report re-

the Association

cars,

are

weekly survey of 34 metropolitan
areas conducted by the ATA De-

Loading of revenue freight in
the week ended Feb. 4, 1964,tto-

production

Freight ~,a_r.
Week
Were 15.4% Below Cor re-

method of reportthe following data:

11 follows:

-need;lor. stepped-up SJ0ork-;; $'usz'jz? "°rS?2f

Inn rt 2iTorm

long-term

a gain of 566,000,000
week
Of
1960,
the
American
kwh., or 4.0% above that of the Trucking Associations, Inc., ancomparable 1960 week.. bounced.
Truck tonnage was an

The revised

nmhiAm,
problems

business

based

and showed

1957-59.

at-, least Our comparative summary for the
,n
in iPaH,nv mnnev centers for th»
leading money
for the

economic

po
three

home,

of production

weekly

average

„

formula

the output figures are given as

commodity Price index

—

revised

longer relates production totals as
a percentage of the industry's operating rate based on the Jan. 1,
1960 overall productive capacity.
Instead, and effective Jan. 1, 1961,

Car loadings

The State of

The

ations.

Output

(761)

were 21,227 cars or 4.5% above Portland, Oregon and Albuquer-

through

the preceding week.
que terminals showed overall ton; T.heJe were 9,955 cars reported nage losses. Several ofthe' weekit.Consumption and Production
16,256,000 tons (*145.4%) ,in the' loaded with one or more revenue to-week shifts were attributable
highway trailers or highway con- to differences in the severity of
fhre^cfnYdTaUenge^cing™: Harsh weather has hurt both penod through Feb. 13, i960. with —
~"
The
Institute
concludes
tai?eIs
week weather; conditions from city, to.
will require flexibility in devising steel
consumption and produc-•«i
vp"^""t7nn™^ .ended Jan. 28, 196i (which were city during this period
and
applying
monetary,
fiscal, tlon
the
metalworking Htqgt. of_ Ingotu Production by jnciuded in that wee^-s over-all
Steel
and other public policies as well magazine, reported,
^ri^S£Z*ek ended Feb' U! total). This was a decrease of 263 Business Failures Edge Up for
.

Tc°srn wlnfSmal SlSS °tn

high degree of private initiaand ingenuity.

tive

The

I960

vear

points

'was

out,

Ppr^nociive

diMyear

for

monetary

the

spring,

policy.
"Early
when some slack

the

economy

became

the

Federal

Reserve

feel

its

discernible,
started

monetary reand ease prevailed

strain! to ease,

throughout the second half of the
year.
But while the System con-

delayed shipments,
Plant operations,

expansion,
monetary
brought new problems, for
decline
when

interest

relatively
serious

the

rates

here,

abroad

rates

high,

ease

were

aggravated

deficit

the

country's

international payments position."

Feb. 11, IJM»l

slowed

and

activities almost to

North East Coast

the

weather

vuwi&iu

took several

that would

without

interest-depressmg Fed purchases!,
of Treasury.,hijls. ^Member bank'
reserves were liberalized, mainly
through
permission
to
count
larger portions of their vault cash
„

.-ir

-i

holdings

—

and

them

nn-

nart

tra^
tral

level^during
for

the

country banks

Teveral

elude

decline

end

rates

ernment

securities

moved

futos

"v'u

half

the

and

term

business needs for cash

tional

pressure

At the

lion

reached
sectors

well

above

the

construction,
be

markets.
levels

reports.

and
such as

economy,

that

normally

are

rates, continued

Total
*

Index

compared with,

by the Chronicle based

Feb.

the

advices

a year

upon

derbirds);

uses

autos

(for

1961 Ford Thun-

important
markets;

architectural

chief

week

Have
Down

the

vear

Seriously
Auto

in
in

continuing batcontinuing Duv

host of shutdowns

ended

States

was

gains
in
promis-

They look for an upward trend
in the sixties that will.be spurred

Saturday,

from

obtain

which

23.7%

new

corresponding

week

last

y.'
same

week in 1960.

with 50 one year ago and
correspondng week in

Barometer

be-

lo™ ^^ction durmg the week
Gnded Feb- 4 1961. In the same

week, new orders of these mills
,.

7-8 ^ below production. Un-

filled orders of reporting mills
amounted to 26% of gross stocks.
lu Iep0Stmg softwood .ml ls» ,un~

$5,000
in

involved

were

failures

week's

week

had

the

286

and

0 itli *1 ncor»c'

Fifty-one

COncerns

348

against 319 in

?4+o'o

8^
^ek.

3.8%

were

toll

318.

Liabilities

Shipments for the Week

Below Production
EndBeirwbproduc'ti«n'8%

the

when

1939

pre-war

was

the

Trade

in the comparable week
and the 292 in 1959.
18%
more
business suc-

last year

nd#»r

failing

the

losses

excess

rising from 45 of this
size in the preCeding week.

$ioo,000,

climbed, among

Tolls
galers to

42^W6%l

struction

30,

whole-

'amofig

contractors

confrom

65}^^ and among service enterprises
l& Yrom 30. riowever, declines
prevaixed in retail trade, down to
160 from 181, and in manufactur-

For the

year-to-date, shipments

industry and

?f^epu0r ing production; new erlde2tlc^1 mllls were
3.7% below
ders were 0.3%

below production.

casuaities

•

trade

groups
above
1960

remained

levels. The steepest rise from a
ag0 occurrevd in services.
Forty-seven Canadian failures

year

;

jpj

mmnarpd

with

69 in the preceding week and 43
,P°t' wol4:ers scheduled to, below; shipments were 2.9% beidled,^e-jndu^rb-y's iterations low; new orders were 13.4% be- Wholesale Commodity Price Index
next week will show a further low. Compared with the correDIps Slightly in Latest Week

decline.

sponding

fW^d'.s said tthat in the of ,the
.£01Tle indus-

e+OQ/,iest operations

sieaaiest operations in me inaus-

week

"hfoments

d°^" thiST week^GM Corp. took
jjj;®

'ow

QrhrArct^r

were

TeU®'bt
oe

w-'a'nT^ew'or^^^

•

Intercity Truck Tonnage for Week
Ended Feb. 4 was 8.8% Below
Ended Feb. 4 was 8.8% Below
Same Week in

Intercity

1960

in the
8.8% be-

truck tonnage

week ended Feb. 4, was

149^

produc-

1960,

below, smpments were io.o/o

t:ryT5r® being posted by Cadillac
»
JJ?,
fwiirl" oeiow.

ttp"

" /0'
However, each of the Big Three

This week, Ford halted

car

family

formations

Data

the-

fee, hogs, cotton, rubber and steel
scrap. The Daily Wholesale Commodity Price Index, compiled by

SjinRo&/

o?9

™?°Trpht

268.63 (1930-1932 = 100) on FebContinued

page

sell

large

at Louisville and
truck output at San Jose, Cal. The
Linden, N. Ji. Buick-Oldsmobile-

car

assembly

Electric

Call

•

Output .4.0%

Than in

The

for

as-

amount

Higher- Y

Marketing Department * •"

1960 Week
of

electric

energy

timated at 14,744,000,000 kwh,,
according to the Edison Electric

Production

general wholesale commod-

Chester, Pa., St. Paul, Minn., and

and

disposable income.

The

ity Price. level sliPPed somewhat
...
lnwpr nriPPS
this week, with lower prices on
grains, flour, sugar, steers and
lambs offsetting increases on cof-

hind that of the corresponding

have 5-day shutdowns planned
I°r next week, including six Ford
Motor Co. p 1 a n t s idling 6,200
workers and Buick-OldsmobilePontiac plants at GM Corp., idling

As previously announced (see
paSe 26 of our issue'Dec. 22) the

those

$^a,o7U455t943 against $20,914,-

com-

<phe statistical service said that
Compared with the previous
49,500 GM Corp., 11,000 week ended Jan. 28, 1961, producChrysler Corp. and 6,200 Ford tlon of reporting mills was 0.7%

electric light
and power industry, for the week
ended Saturday, Feb. 11, was es-

Steel

Our nreliminarv tntal* stand

705,128 for the

week

curring

Week Ended Feb. 11

weekly

above

current

shipments of 441 mills
reporting to the National Lumber

tle to keep dealer inventories in
bne wRh sales Ward's Automotive Reports said.
Ward's said

originating this type

Lumber

Slowed

Production

the
ine

1959.

the

Lumber

weekly production for 1957.59.

distributed

clearings

average

Shutdowns and Inclement Weather

Chevrolet.

country, indicate that

possible

was

U. S. rail-

1959.

81.8

industry

production based

ing revival in aircraft markets; Pontiac plan! also was idled this
and heavier sales of stainless con- week and Tarrytown, N. Y. for

tele-

the*

from

New

be installed

11, clearings for all cities of
United

Class I

example, stainless mufflers are to Wayne, Mich, will be down plus

...

Producers of stainless steel also

Preliminary figures compiled

^01>,.

pared

period

sembly at Dearborn, Mich., Mahwah, N. J., St. Louis, Mo.
Next
week
output
at
Atlanta,
Ga.,

costs

product

new

expect:

clearings last week showed

_•

cities of the

101

were

49,500. In addition, Chrysler Corp.
will idle its Detroit area operations and those at Newark, Del.

than regular stainless (Type 430).

graphic

road systems
traffic in the

Technological
advances
now
permit bright annealing of stainless steel so it maintains its appearance for a long time.
And

recessions,

% Above
Corresponding Week Last Year

ago.

6.7

million, ingot output 99.3
million tons.
This year will be a dynamic one
for stainless steel, the publication
was

n„orir,„

1956, when oly 5.8 milbuilt, steel ingot

output was in excess of 111 million tons. 1960's auto production

■
'
Bank Clearings Were 23.7

crease

were

1953 and 1957, years when 6.1
million cars were produced, ingot
t-mo
wcic
jjiuuuuuu,

weak.

Bank

corresponding
There

the

prior

sensitive to these
to

cars

"
autos

HHU1UI1

meet

the

and

production was 115.2 million tons
-second highest in history.
In

long-term rates

end,

year

still

were

don't.

put addi-

the

Western

decrease

corresponding period of 1960,

usually

market for durables. '
Steel can do well when

only

liquidation

securities

plant

there's

up,

icmuvcy

Government

for

spending

Wgh" employment 'and" ~a "stron'g

of securities

ond

steel°d'emmid than
demana man
,

relatively t"S" volhigh vutduring the sec-

a
"

iluuwu

ume

isn't

When

equipment is

slightly lower in the second half,
Business, states and municipalities floated

use

slowciown m steel use isn 1

VZ, f"ct0r°bi

or September,
long-term Gov-

week

goods industries, such as machm-

by August

Interest

cumbed than in the similar week

for

1961

two-tenths of 1% below

Southern

automotive

The slowdown in steel
n

ma+ket

short

Some

38,152

cars or

a11 auto"!ot!ve' of c0"rse' CaPltaI with

And

pretty much at

was

but 12,092 cars or 46.4% above the

b°'di"g d°wn steel demand from decc""e' Bad weather als0 was a

notes, as a means of
moderating the impact of such
operations on Treasury bill rates.
The

SSSSfS

and

interest rates

the

weeks

aan

certificates, and short-term

bonds

four

vvu/oi saia a nosi 01 snumowns filled orders were equivalent to ir.0 nff+n K4. frnm 69 Thprp wptp
this week, including American 14 davs'nroduction at the current i g'
? R
fu
Auto Production is running Motors Corp. and Studebaker- Jate and grora stocks were^SSiv- fewer retailers failing than indhe
about 40% under what it was at Packard Corp., 01
pulled U. S. car aient to 52 davs' pioaucuon.
nrodYuon
similar week a year ago, but in
Rficrv.
Qd^
other

received

open

the

preceding week, reported Dun &
Bradstreet,
Inc.
Casualties exof ceeded considerably the 317 oc-

first

the

St. Louis

yeipanci lFVm inG. auiomouve
industry continues disappointing,

broadened to in-

were

last

ton

from

piggyback loadings

next weeK
next week

chants

occasions

operations

gross

Demand^

to 376 in the week
from
368 in the

greater

banks

from the vault cash
on

were

rafsed

yiew...01 these relatively
the
benefits

the week

totaled

upwards of 66,000 will stay home

heavv melting grade held at

^32 07

were

whd

were

1 492 000

Feb.

for

More than 35,000 auto plant
workers were idled this week and

steel's scrap price composite on
i

Cumulative

edged

was

week

then

ended

Week

Commercial and industrial fail-

tons

the

Output

».ni/S U
ended' Feb

■

Doured in

ratio/for

veal-

the

hankl
banks

Droduced

Feb

all

rP?PnL

eitv
city

reserve
reserve

ultimately

renuirpment

serve

industrv

ures

Cincinnati

moderates,

tuations in store for the balance
of the montR
Operations still
hover around 50% of capacity.

large-scale

Feb.

corre-

above the 1959 week.

Chicago

demand for steel is expected to
accelerate.
Production continues to move
sideways with only minor fluc-

xn-ov-x

measures

credit

ease

v-vxv-xcio,

the

Detroit

new

P™babnys theatc ^IcAstirnates^he

below

Cleveland

monetary policy moved on to
outright ease, the Federal Reserve

the

2.6%

Buffalo

car
buyers out of dealer showroorhs.
January sales were the
lowest in several years,

Once

sponding week of 1960 but an increase
of
2,926
cars
or
41.6%

Pittsburgh
Youngstown

standstill,

Finally, they kept potential

cars

Ingot

Week Ending

Production this week will

half of

8,824,000

'Index of

year,

the second

Production for

They brought construction, mining, quarrying, and other outside

tributed what it could to renewal
of

amounted

Storms that swept much of the
nation in late January and early
February snarled transportation,

from

way

Feb

Harsh Weather Affects Both Steel tons (.»78.9%);or 45.7% below the

the

American Iron and Steel Institute Institute.
Output was 328,000,000
jiasmaterially changed^^ its weekly kwh. below that of the previous
report on the steel industry oper- .week's total of 1-5,072,000,000 kwh.

Merrill Lynch,

Pierce, Fenner & Smith

INCORPORATED

70 PINE STREET
138

NEW YORK 5,N. Y.

offices in the V. S., Canada and abroad

(762)

The Commercial and Financial Chronicle

ding.

Harriman,

pany,

TAX-EXEMPT BOND MARKET

Lehman

Barney

DONALD

MACKEY

Ripley & Com¬
Brothers,
Smith,
Company,
Stone
&

Webster

Securities

and others

bidding.

Corporation

the award in close

won

The

bonds

reof¬

were

fered at
In

tinues

its

happy

tend¬

the

marketplace.

—

demand.

Although

the

propulsed
factors

politico-economic

deriving from the

ministration,

these

considerations
way

to the

dox

have

technical

the

factors.

New

Look

Administration

new

the

from

stantial

perhaps fatuous
in some of the

oratory

inherent

controversial

planks,
that

thus

will

likely

Presidential

Congress, at
before
must
to

prevail.

important

considered

cruals

groups

labor

other

and

reassuring

been

means

resolved,

has

been rather effectively sidetracked

present danger by the forth¬

right
fore

Presidential

statements

be¬

Congress and Jp^e^e,the press

groups.: This is but one of the re¬
cent

reassuring developments.

For the

that

the

regard

present it would

week

schedule

The

largest

calendar

the
little

totaled

items

new

the

Com¬

monwealth of Kentucky general
obligation serial bonds to be of¬
fered

competitively, and $100,000,-

thority

revenue

bonds to be nego¬

tiated
by the Dillon, Read and
Company group. Both issues are
slated

offered

in March.

long-term

have

bonds

coinci-

dentally or otherwise done better,
while
Treasury bill rates have
moderately increased in terms of
yield.
Developing
these
some¬
what antithetical ends to effective

fruition

for

the

President,

the

Federal

likely

else involved

difficult

the

Reserve

Treasury,
or

time nurtured inr

vestment habits must of
be overcome.

start

has

limits

However,

been

the

anyone

made

objectives

Georgia
thority

White, Weld &
including Halsey,
Stuart & Company, Inc., Lehman
Brothers, Phelps, Fenn & Com¬
pany,
Shields & Company, and

Company

Stone

and

within

half

not

ties

not

banks

and

the

ers

market
vestor

bonds
even

outside

traditional

with

winter

not far

seems

possible

bank¬

rely

upon

proportions;

imbalance

the

rigors

from extinction,

that
the

the

About

offering is out of

ac¬

new

(Feb.

15)

witnessed

group headed by The

hattan

City

Bank,

The

may

frontier,

Bankers

Morgan

pany,

National

Com¬

Trust

Guaranty

Trust

and Lehman Brothers.

bonds

were

from 1.50%

reoffered

yield

to 3.35% for the 1962-

1988 maturities.

turities

The

The last five

(1989-1993)

coupon

4.20%.

and
The

bore

were

ma¬

1/10

priced to

dollar

equiva¬

lents approximate 30. The inves¬
tor reception is reported as good.
Also

Wednesday,

$6,900,000

City of Providence, Rhode Island
general
bonds

obligation

were

(1962-1984)

offered for public bid-

Rate

(State)

Connecticut

„___

(State)
New Jersey Highway
Auth., Gtd.__
New York (State)
Pennsylvania (State)
Vermont (State)
New

Housing Auth. (N. Y., N. Y.)
Angeles, Calif
Baltimore, Md.
___:
Cincinnati, Ohio
New Orleans, La
1
Chicago, 111.
New York City, N. Y

Los

Maturity

price of
Louis

St.

the

issue

offering.

Bid

The

also

South

funds

for its

came

high-grade

investment

Wednesday.

$2,080,000

Louisville, Kentucky general obli¬
gation
(1967-1998)
bonds
were

Yields

from

ran

3.40% in 1995.
turities

carried

and

pon

2.35%

were

1967 to

The last three

ma¬

of- 1%

reoffered at

yield. The issue is about 25% sold.
Commercial

The

and

Financial

Chronicle's high-grade state and
municipal bond yield Index aver¬
ages

at 3.23% as of Feb. 15; down
3.24% a week ago. Dollar-

this

This

represents

average

gain of close to. V4

point.

yield average prevailed

same

during most of December and into
early January.
Yields then in¬
for

creased

period

1,225,000

1962-1981

8,000,000

1962-2001

11:00

a.m.

1962-1974

11:00

a.m.

1962-1982

Noon

New York

(State of)______——10,476,000

Feb. 20
Canton Local School District,

Dallas, Texas

The

gives

Chronicle's

weight

yield

type

bonds. Thus the recent gains made
many
have
not
average.

However,

Barney

Index

Bond

the

Company

Toll

Smith,
Road

these gains

expresses

dramatically. On Feb. 9, the last
reporting date, the average yield
3.70%.

this

average

market

early
than

line

corporate

the

with

the

in the

bonds

3-point

interim.

District, Calif.

a.m.

1982-2001

2:00 p.m.

1,360,000

1964-1986

11:00 a.m.

2,400,000
1,300,000

1981-1984
1962-1981

Noon

1,150,000

—_________

Dist., Ohio

1962-1973

Noon

1962-1981

Noon

3:30 p.m.

Feb. 23 (Thursday)

;
Chesterfield

County, Va.__:
County, New York
Fond au Lac, Wis
Erie

rise

same

riod.

water

works

calendar

1963-1990

11:00

a.m.

1963-2000

10:00

a.m.

1962-1973

8:00 p.m.

Roxbury Township School District,
New Jersey
Santa Maria Joint Junior College

1,720,000

19C2-1980

8:00 p.m.

:1,000,000

1962-1981

District, Calif.

Feb. 28

1962-1981

11:00

a.m.

5,000,000
Chillicothe City Sch. Dist., Ohio__
1,500,000
Columbia, South Carolina-'• 2,500,000

1962-1987

11:00

a.m.
a.m.

New

feature

Dallas,

teresting
largest

26.

Texas,

revenue

Both

Mexico

Dist., Calif.
Prince Georges County, Md

obligation

$6,370,000 Erie County
(Buffalo), New York (1962-1974)
for

sale

Feb.

gain

23.-

seems

—

3.15%
3.10%

LOS

3.00%

State

Sch. Dist.,

3%%

1974-1975

3.00%

2.90%

have become affiliated with Bate-

3%%

1978-1979

3.15%

3.00%

3%%

1977-1980

3.35%

3.20%

Eichler & Co., 453 South
Spring Street, members of the

3%%

1978-1980

3.65%

3.50%

Pacific Coast Stock

314%

1980

3.35%

3.20%

ZVz%'

1980

3.30%

3.20%

South Park

be handled

March 2
Jefferson Parish, Fourth

was

Caldwell
eler
Co.

formerly

Caldwell

was

Co.

with

Sch. Dist. No. 622,

Hill

a.m.

1962-1991

10:00

a.m.

1962-1981

Noon

1962-1985

11:00

1963-1985

1962-1981

1,000,000
3,500,000
1,500,000

—

Lisbon,

& Co., and Associates).
10:30 a.m.
1962-1986

1,000,000

Minn.

March 6
Pawaukee,

a.m.

11:00

a.m.

(Thursday)

Wharton Indep. Sch. District, Tex.

1963-1989

1964-1981

2:00 p.m
8:00 p.m.

10:00

a.m.

(Monday)

Union

Etc.,

High Sch. Dist. Jt. No. 6, Wis.__

1962-1981

2,000,000

8:00 p.m.

River Falls Etc., Joint School Dist.,

1,015,000

Wis.

Water

____.

7:30 p.m.

Ma-

Co.

Mr.

Richards

(Tuesday)

County Flood Control &
Conservation

—

;

Los

Angeles Dept.
Power, Calif-Paul, Minn

County

5:00 p.m.

1972-1999