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IS. ADM.
IBRARY
'.
Final
Edition
Volume
New
4456
By HON. JOHN L. MeCLELLAN
Senator from
S.
U.
A
Arkansas
Democratic Member of Senate Com¬
mittee
Warning
Against Hasty Action by Congress
in
Commerce,
on
A^AvCMA'A.
Formerly
Expert
Consideration
(1) Does There
Exist
:
(2)
Does
Govern¬
ment
Possess
With¬
It
Impairing
out
Se¬
Economic
curity; (3)
Do Terms of
Serve
Loan
.John
L.
'' Some of
Interests
Best
Can
of Both Goverments; and (4)
British Government Meet the Obli¬
loan
proposed
Britain
to
.will
ment
asked
be
to
make
to
of
this loan have been negotiated by
representatives of the two govern¬
of
Parliament
the
and
ments
The, terms
countries.
foreign
A:fr
(Continued
is
now
awaiting
on
page
284)
we
the
i Index
of
■m
are
Jr.
1
ques¬
tion is
ti11
s
ifej
r
'
vf
'AA
-.'V
on
AA-A
A
Continuous Paper
American
|
A
I
adopt
$:A
To define inflation is just about as easy as to define religion or
There are as many definitions of inflation as there are mone-
love;
trade.
-
report of
A
when
place
in
-
to -Prohibit
Strjk$$ fap'd..;to|Re^ui^I
bifPublic Interests, Compulsory ;i
There
is
.
;A A
'
A ,\-
^159)
the
Parliament,
"the
The
num¬
ber of those who welcomed mul¬
for
its
active
opposition'
.■,
negligible/'. He
(Continued
Aerovox Corp.*
A
i
■
■
.
•
■
-
.*
i
,.-i
.■
•
.*.
.<•
*
•'
A
f :
Successors
"'A Prospectus
AaA A,
to
Members New York Stock
CO.
and other Exchanges
i
2-0000
Hanover
Cliicago
Teletype
Cleveland
NY
request
on
»
'■
Established
■
INVESTMENT
64 Wall
25 Broad St., New York 4. N. Y.
•
-iA'AA
Exchange
-
f
(Continued
I Inl I FUNDAMENTAL
..
v
:'
INVESTORS • INO
A
■/•'■' '
on
of
tions
;
a
as
Dr. Melcbior Palyl
to
which
under
find
money
people expect
"on the street,"
'and spend accordingly.
(Continued
Donald
R.
This is of
entirely unacademic. but it
course
Ciub
in
the Washington
A .A''
page
on page
268)
Richberg
279)
A'''."',-/';
A-AA
New
law
York
firm
of
State and
/
.
.
" A'A"A -A/A.
Street, New York 5;
BOSTON
3-210
PHILADELPHIA
Troy
Albany
Buffalo '
Syracuse
Pittsburgh
Dallas
Wilkes Barre
London
AGeneva (Representative!
Baltimore
prospectus
Springfield
Woonsocket
Brokerage
;AAA ServicepAA
,
y
■■/
.'
■ ■
s '/'A;
*'v
•'
iMcotfoiariD
STREET
NEW YORK
5
/: /.-'j
Members New
.
634 SO. SPRING ST
,
Bond Department
■
THE
CHASE
Members New York Stock
HUGH W. LONG and COMPANY
48 WALL
and Dealers
H ardy & Co.
DEALERS
from
of
,
:A;
FROM
AUTHORIZED
'
Bonds
for Banks, Brokers
be
may
OBTAINED
1927
SECURITIES-
Bond
*
R. H. Johnson & Co.
'
HIRSCH. LILIENTHAL &
inflation
set ' of. condi¬
;'
Executives'
City, Jan.
263) AAA A
COMMON STOCK
;
i hirsch & Co.
•
quoted. T sug¬
gest- defining
Municipal
A ,Vk\v-A* A'. A
• *<
it
be
not
comes
by Mr. Richberg before the Sales
IS, 1946.
Mr. Richberg is a member
Davies, Richberg, Bee be, Busick & Richardson.
that
Alaska Airlines
* Prospectus on request. AA;"
-
shall
v
Nu-Enamei A
t- »A"\' -'"-v'AA-.-
j
added
on page
out
medi-
e
sake
own
the Chairman of the Liberal Party
Ordinary Shares
..
mainly' from
leaders of labor and management who are hop¬
ing that they can win a few big battles and then
dictate the terms of peace. Every proposal to lay
took
an
Provided
minimize, industrial warfare.
brought out,
discussion,
as
of
dictionary.
ca t
industrial A
of
program
as
the
strike
of. th
-MA A
effective
no
.
"A" &
' i
.
word. al¬
ailment
>Serious
which will be supported today by the most
conspicuous leaders of organized labor: and busi¬
ness, managers are so divided and confused that/
■■AAAvvA^A-;/
they have no accepted program. But the Amerhis recent excellent ican people in overwhelming numbers, including
British reaction to a large majority of labor
unionists, want the
loan
("Chronicle" •Congress to pass a law that will end, or at least
trade
A
abolish
and
the
name;
peace
the
A.
intelligent
Dr, Wm. F. Hauhart
American
,.
A
professor
C. Pigou
ed
to
•
the
■v->
fol¬
together^—a
Arbitration.
is
Dr.
some
whom
procedure
When Demanded
or
multi¬
a
tary; econo-
Leaders Are
'
lateral system
Rapid
by
Represented
as
if
ffLaw
able to
even
was
A
History,"
Change From War to Peace Production, the Trend
Is "Bullish" and "Business Cycle" Being Distorted.
*Address
Gaumont British
Money Expansion and Concludes
That "in the Face of One of the Fastest Deflations in
.
atr d.
political,
willing
tilateral
I
Sees Inflation Potential in
Opposed to Impartial Government and,
Unrestrained, They Have Power to Paralyze /
Nation's Energies Through Work
Stoppages and
Physical or Political Intimidation. Urges a National';
of the past
decade, both
Dec, 27," page
Features
Regular
288.
of "Full Production."
v
At' A ' A A -A AA: By DON ALD R. RICHBERG* .;AA:,rf:f,',v:A/A;;^A
Prominent Attorney and Publicist Sees Peril to Democratic Government
if-Unrestricted Right to Strike I3 Given to Labor Unions.
Holds Labor
whether
England,
i n
conomie
Absent, There
Strong Deflationary Potentialities Which Are
Being Subdued Through Price Fixing and Absence
..
open
s
on
low the learn¬
striving for,
that
page
People Expect to Find Money
Spend It Accordingly," Dr. Palyi
this:
Paul Ejnzig in
transaction
Notes That With These Conditions
and
of
aceptance. Final approval
and the ultimate eonsumation of
this
t
Street
mists,
of
or
the
'
Britain has already voted ratifica¬
tion
tions Under Which
should be the
object
AaAAv
A
lateral trade. I
grant
Copy
"a Set of Condi-
as
I
<&-
be the promo¬
tion of multi¬
commitments
should be x*egarded as the first in
a series of loans that our Govern¬
Defining Inflation, Figuratively,
A
leading bankers and industrial leaders have empha¬
primary goaf in extending credit to England should
pur
a
Are
our
view of her
gations Imposed.
The
sized that
but
McClellan
■
Methodist
to Conditions of the American Loan, Which f
They Feel They Accepted "Under Duress."
...
vide
A,;AA 'A;
Southern
BritainV International Economy, in Pointing Out the
on
|f Give Lip Service Only
Resources and
Ability to Pro¬
of
Trade Preferences and Other Bilateral ArArangements.
Holds British Tariffs Are as High as Our Own, and
That the Sterling Area Is a Threat to Free Trade.
Concludes That
British Are Strongly Averse to Anchoring the Pound to ihe Dollaf,
and in View of This Situation, Expresses Belief That They Will
for
Loan;
Business
of
By MELCHIOR PALYI
A:
With Tariffs, Cartels,
Real
a
Necessity
School
Difficulties Involved in British Adoption of Multilateral Trading,
Contends That Britain Deliberately Chose a Controlled Economy
for
Questions
System ?
University. Author oh "England's Decadent International Economy."
Approving British Loan, Poses
:
Following
T
tlie
A
...
By DR. WILLIAM F. HAUHART
of
Dean
Price 60 Cents
1
Adopt
A Multilateral Tiade
AW
2 Sections-Section
York, N. Y., Thursday, January 17, 1946
The British Loan Will Great Britain
■
In
ESTABLISHED OVER 100 YEARS
Number
163
JAM 1 81946
York
30 Broad St..
Tel.
Exchange
Cutb Exchange
NATIONAL BANK
New York 4
DIgby 4-7800
OF
THE
CITY OF
NEW YORK
Tele. NY 1-733
LOS ANGELES 14
,f
h
Acme Aluminum
Common
corporate
A BOND
A
finance;.;/
.
secondary'
BROKERS
■A
•
:i-V
'
A- v
&
f"
markets
Common
..
' ;
90c
i-v
*.
Conv. Preferred
;
;(
Members
incorporated
N.
WALLST., NEW YORK 5. N, Y.
Y.
Security Dealers Ass'n
45 Nassau Street
.
Tel.
REctor
2-3600
New York 5
Teletype N. Y. 1-676
Philadelphia Telephone-
Enterprise 6016
on
,
HART SMITH & CO.
request
Reynolds & Co.
Members New York Stock Exchange
120 Broadway, New York 5, N, Y.
Telephone:
Bell
REctor
Teletype
NY
2-8600
1-635
Members
.
New
52
York
WILLIAM
Bell
New York
1
.
Security
STL,.N. I". 5
Dealers
Assn.
I
'
■
Dealt, in
$6 Preferred
A-
N. Y. Curb Exchange
on
Analysis on request
Raytheon Manufacturing Co.
$2.40 Conv, Preferred
Kobbe', Gearhart & Co.
MEMBERS NEW YORK STOCK EXCHANGE
Brook Water Co.
Solar Aircraft Company
.
Spring
'
The Firth Carpet Co.
Prospectus
telephone-bector 2-6400
Scranton
Preferred
A
4
BULL, HOLDEN & C9
1 4
Alloys, Inc.
Conv.
IRA HAUPT& CO.
Members
York Stock Exchange
Principal Exchanges
New
and other
111
Broadway
New
York 6
10 Post Office
Boston 9
SU|.
BAnover 2-9930
Teletype NY 1-395
Montreal
Toronto
REctor
2-3100
Tele. NY 1-1920
Direct
Private
Hancock 3750
.
Wire to Boston
,
Trading Markets in:
•
American Phenolic
'
Diesel
'
Members
Y01& Security Dealers Ass'n
Securities Dealers, Inc.
3BL3L TELETYPE
S CO., INC.
'*r.
Bought
—r,
Sold
Quoted
-—
Debts; and (3) That Insurance and Other Investment Institutions Have Almost ^
One-Half of Their Total Assets in U. S. Securities, Sees Potentiality of Inflation¬
Established 1920
Steiner, Rouse & Co.
There Is Little Possi-
Boom in Large Debt Holdings of Banks* and,; Because
ary
HA 2-2772
PL. N.Y. 5
P. R. MALLORY
..
(2) That Commercial Banks Hold More Than 30% of
and Private Combined;
KING & KING
Ne*
•'
/ v:5;
Stressing the Importance of, the National Debt in Shaping Our:Future Economy,
Dr. LeJand Points Out That (1) the Debt Nov/ Exceeds All Other Debts, Public
■-
Lear Inc.
Nat'I Ass'n of
..'; ; ;;
M,'1,:'"
;
v,
Professor of Government Finance
University of Chicago
/ ■ :\';v('3'.7
v.
Universal Camera
40 Exchange
/
By SIMEON E. LELAND *
■"
..
Thursday, January 17, 1946
and the National Debt
The Government, the Banks
Rademaker Chemical
CHRONICLE
THE COMMERCIAL & FINANCIAL
*
242
Members New York Stock
bility of Debt Reductioii in Next Few Decacbs, Urges Caution in Solving Difficult
Problem of Future National Debt Management. Proposes Two Alternate Solu-
NY 1-423
25 Broad
HAnover 2-0700
Direct wires to
Transfer of Debt From Member Banks to
our
Al a.
branch offices
New Reserve Restrictions.
rowing of Government From Reserve Banks Under
;
NY 1-1557
New Orleans, La.- Birmingham,
tions: (1) Creation of Special Non-Marketable Securities for Banks, and (2)
Federal Reserve Banks, and Direct Bor-
f
Exchange
St., New York 4, N. Y.
by reason of^
and depression, has become
The national debt,
.Bought—Sold—Quoted
wars
large that the problems
120
WOrth 2-4230
N, Y.
Bell Teletype
size,
not.
al¬
been
ways
'
SALE
FOR
lems,
any
400 shares
way
& J. Sloane
Exempt
not
Ultimate Government Ownership.
fi¬
the
and
icies
New: York
Curb
Supreme Court. The
York 5
Simeon
E.
Leland
the
will
but
have Important
upon
the
(Continued
on
say
S>
eco¬
Preferred
&
consumer,
•
Pressed Steel Car
So* Advance Bag & Paper
Common
•in <7
■': ■:■
■
-y y :■ y y yy
■
'
yy
more
ant
Elisha
ration.
Members
Boston & Maine R R.
York Curb
Stamped Preferreds
Tel.
REctor
import-
aspects
These questions were de¬
in
a
Feb. 12, 1943,
on
Exchange
120 BROADWAY, NEW
these
require analy¬
sis and explo¬
Friedman
at my own expense,
.
■'■Vxv- tteio York Stock Exchange
New
or
two-volume report
prepared, as a public service and
veloped
MC PONNELL & Co.
Teletype NY 1-1843
o r
public.
Yet
York 5
Telephone: WHitehall 3-1223
Belt
i
t
e s
the
Bought—Sold—Q uoted
H. G. BRUNS & CO.
20 Pane Street, New
•. •
Conv. Pfd.
inv
the
of Hon. Clarence
Lea, Chairman of the Commitf
F.
YORK
at the request
2-7815
tee
Interstate
on
and
&
"
AB1T1BI POWER & PAPER,
Paper Co.
in U. S. FUNDS for
Common & Preferred
BULOLO GOLD DREDGING
Artists Theatres
•
the
basic
the
the
report.
and
Members Ji". Y.
■
Canadian
Security Dealers Assn.
37 Wall St., N. Y. 5
Bell
Teletypes—NY
taken
Tover. I Younger men, some from
other
Industries,
are
now ' in
charge.
Nor shall I speak for
them.
I plead on behalf ©f the
public, the consumer, the investor
and
the taxpayer.
!,
"
&-1127-
Members N. Y. Stock Exchange
Arkansas-Missouri Power, Com.
115
Telephone
BROADWAY
are
1
NEW YORK 6, N. Y.
Teletype NY 1-672
Empire District Electric
Common
Iowa Public
jj
&
5%
^Electronic Corp. of Amer.
For
Banks, Brokers & Dealers
of
the
Public
5s/2000
•
Consolidation Coal,
m,
Minneapolis & SL Louis
all
issues
-
>
Vl'.^IvV-AVv
I Wall St., New York 5, N. V.
Teletype NY 1-955
under Section
Utility
Holding
of 1935, and apply
the disintegration clause, Section
Company Act
only
companies
against
Abolish
all rate . making
whether original,
aboriginal, or reproduction cost, J
prudent investment value, or |
yardstick plant,, ' Instead, use the
sliding scale, a device proven for
and
on
cost,
a
Associates
yy
Common
the search for orig¬
cost
almost
Eastern Sugar
that
integrate, y.;
hundred years in Great
Britain, whereby the
annual in-
Issues
70 PJNl ST., N. 1. 0
Bought—Sold—Quoted
Pfds.
(B. A. Saxton & Co., Inc.
Whitehall 4-4970
Teletype NY 1-609
MACHINE
Common
/
Bought
—
Sold
BOUGHT-SOLD—QUOTED
Quotations Upon Request
F Alt It
&
CO.
Members
New
York Stock
.
New York Cojfee & Sugar
120 WALL
-:
Exchange
,
Exchange
ST., NEW YORK
TEL. HANOVER 2-9612
Troster,Currie& Summers
Members N*.Y. Security Dealers Ass'n
Simons, Unborn & Co.
'
Members New
25
York Stock Exchange
Broad St., New Yprk 4, N. Y.
HAnover 2-0600
Tele. NY 1-210
Jefferson-Travis Corp.
Western Union Leased Line Stocks
International Ocean Telegraph Co,
Pacific &\Atlantic Telegraph Co.
Southern & Atlantic Teleg. Co.
Empire & Bay States Teleg. Co.
"Prospectus Upon Request
Utah Power & Light
$7
FEDERAL
& WELDER
Segal Lock & Hardware, Pfd.
United Public Utilities
I
Susquehanna
Chicago, Mil., St. Paul & Pac.
Dlcrby 4-7060
Haile- Mines
Common
:
4% s/49
Cayuga &
plan to integrate the utilities in¬
30
Harrisburg Steel Corp.
Kingan & Company, Com.
Paget Sound Power & Light
&
VliVlI MM,
Pfd.
All.., Issues
$6
/
Service, Com.
England Public Service
All
Consolidated Film Ind.
v
0
continued on page 270)
Missouri Utilities, Com.
New
YORK
NEW
HAnover 2-9470
Members New York Stock Exchange
follows:
as
York Curb Exchange
8T.
Order the industry to prepare
based
and Other Principal Exchangee
BArclay 7-0100
WALL
Teletype NY 1-1140
GUOE, WlNMILL & CO.
IL
.
mary,
inal
Securities Dep't.
Goodbody & Co.
•
have
My recommendations,, in sum¬
j
2.
MINESI
Hanover 2-4850
1-1126
They sinned
managements
that refuse to
■
i
in
Members New
64
visited with punishment.
were
New
Frank C.Masteison & Co.
Chicago North Western
agements of the 20's.
and
NORANDA MINES
STEEP ROCK IRON
discussed
problems
1
,
'pT shall not defend the old man¬
11,
PAPER;
& ONTARIO
MINNESOTA
to
Commerce.
Foreign
and
to regional systems
We Maintain Active Markets
presented
was
Sub-Committee of
on
Inter-
Committee
heads of the leading
public; utility- holding . companies
will appear before this Commit¬
tee.
But they will not deal with
a
Preferred
Essonri State Life Insurance
Oxford
House
1' 1.
Kaiser-Frazer
Broadway-Barclay 2s, '56
Foreign
Botany Worsted Mills
Common
Securities
the
Soon,
it
the
benefits
summary
the
stated
court decide
Campbell
Common
A
is
whether
A,
Federal Mach.&Welder
—
sentatives, and in a series of letters to him from 1943 to 1945. An
nomic. policy.
Nor
will; the
281)
page
.
integration
v.v.\Vv;v
.281.
(Va.)
abstract of that report follows.
It
'dis¬
whether
sound
Common
Central States Eiec.
Ill' Common Stock
——
com-
not
will
Tor footnote reference data see
page
of
stitutional.
influencing levels of
production, employment, income
flows, the volume of credit, bank
IBymdun Corporation
,
pames is con-
whole
economy,
Bell System
System Teletype NY 1-1919
utility) Commerce of the House of Repre-
holding
reper¬
also
Broadway WHitehall 4-8120
Bell
.
clause;" is up before the United States
highest court is soon to rule whether or not dis¬
integration
the
government,
cussions
Telephone COrtlandt 7-4070
Teletype NY 1-1848
if
.
probably
Exchange
31 Nassau Street, New
of
Members New York Curb Exchange
50
"death-sentence"
The'
\
economic pol¬
Federal
Members New York Stock Exchange
r;
/L
oper¬
ations
Edward A. Pureed & Co.
Prevent
"Splinters" * Which Will Retard and Possibly
may
e c
Consolidations (Rail¬
roads) to the Benefit of Shipper, Investor and Public; Op Else io
Continue Our Utility "Fragmentation Policy" Resulting in Tax-
t
f f
only
Members
Utilities.
Follow the Successful British Experience in
or
at
rate the
they are
nancial
Vanderhoef & Robinson
on
handled,
a
Common
the Need for Examining Policies of Foreign Govern¬
Declares That Our Alternative Is Either io u
He Urges
ments
prob¬
debt
Greater N. Y. Industries
Economist States That Government's Disintegration
Efforts During the Past Decade Have Been Futile and Destructive.
f
o
Electrol
Myler Plastics
Consulting
jor concern to
citizens.
The
solution
Utilities
on
ELISHA M. FRIEDMAN
By
,
a
matter of ma¬
;
1-1227
Policy
.
regard¬
has
Stock Exchange
Broadway, N. Y. 5
Members Baltimore
,
Differential Wheel
of
less
I
Automatic Signal
v.I
the... public
debt,
Pressurelube
; I
created
by it can no longer escape atten¬
tion, if indeed
■
■
so
74
Trinity Place, N. Y. 6
HA 2-2400
Teletype NY 1-376-377
Private Wires to Cleveland
Detroit
-
Pittsburgh.
-
St. Louis
bought
-
sold
-
quoted
J-G-White & Company
INCORPORATED
37 WALL
ESTABLISHED 1890
Tel. HAnover
2-9300
Arnhold and S. Bleichroeder
NEW york 5
STREET
.
Tele. NY 1-1815
INC.
30 Broad St.
WHitehall
3-9200
New
York 4
Teletype. NY 1-5U5
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4456
Volume 163
j
The Economic and Moral
in the Stock Market
By EMIL SCHRAM*
Aspects of "Disclosure"
Philosophy if Applied to Business j
Generally Would Wreck Business Economy. SEC's j
gfFua Disclosure" /Theory,
ford Go. Case
;
'
as
Well
Applied in Recent Ox- j
Several Others, Would j
Destroy Free Markets, Eliminate Small Dealers and
Lead
j
Monopoly in Securities Marketing. The
H, Ethics of Individual Independent /Bargaining Be- [
tween Dealers and Customers Defended by I Econ- f
:
v/lfei
Philosophers
V •;'.
as
in the Public Interest.
v
^;Vr.v
^ >
of the Securities and Exchange
"full disclosure rule," whereby a
The insidious attempts
v
Commission to enforce
a
required to disclose
to his customer the price which he has paid
for a security he is offering for sale or the
price at which he proposes to sell that
which he offers to buy, not only departs
from trading principles and technique es¬
tablished from the beginning of commercial
transactibns, but it also destroys the very
basis upon which bargaining and exchange,
as a human every day activity, has always
been Conducted.
Individual free bargain¬
securities dealer will be
wwm
r.
ing on the part of buyers and sellers has
been long recognized as the means whereby
market prices, reflecting the equilibrium of
tion of
and
' a century
-
:
'.the
factors
a
r
serts That Investment in Common Stocks
ties Is Sound
New
274)
on page
V
,
Low-Priced Oil Speculation
Well
as
as
Memorandum
York, should be interested in the work of the
Ex¬
of
demand
official
its
for
the
securities
of
name, -this
exchange
is
truly
a
na¬
publicly
tional
uppermost in the minds of
.
WALL
v e
1 y
owned
inflation.
of
pression
There
in
is
minds
the
of
Indianapo 1 i
warranted,
in [ my
only,
limited extent.
s
New
York City.
Because
'
;
t
a very-
U
I
„
by
"Remarks
tj:
interest in the
impression
Mr.
fore the Indianapolis
Emil Schrana
opinion;
.
,
.
timely and to the point.
It
seems to me that the small dealer
is faced with one of three alter¬
was
old New Deal vindictive
animos¬
garding physical possession of se¬
curities is carried through: 1st, he
can close up shop and go with a
large house; 2nd, he can confine
himself to brokerage transactions
ity toward anyone who is making
a decent living.
Surely the SEC
knows very well that a small, in¬
dependent-dealer in securities
who looks up his own investment
suggestions, cuts customer's., cour
pons for them, makes out their
income tax returns, delivers se¬
and go into bankruptcy; and, 3rd,
he can inventory everything, he
advises them 20 times
this
if
natives
new
doctrine
re¬
suggests to customers and, even¬
tually, arrive at bankruptcy by
that route.
'
1
curities
them
to
\ -
•
L. i. GOLDWATER & CO
Members New York Security Dealers Assn.
is
39 Broadway
New York
i
cerning all their
lems
.
cannot
j
LEAR, INC.
(Continued on page 280)
That the Issue Raised Is Novel
& TRANSMISSION
On Jan.
11 ^
"Prospectus
before Judge Mandelbaum, at the United
proceeded on
30 security dealers throughout
the country for a direction that the Securities and Exchange
Commission be compelled to enter a final order in the pro¬
ceedings which it initiated relating to by-law amendments
applicktion "made by
some
J. F.
Members
New York Security Dealers Assn.
40 Exch. PL, New York 5, N.Y.
HAnover
Bell
it
■does it do
sitate
some
keeping.
cut
their profits
anything except
small
is
TITLE COMPANY
CERTIFICATES
Bond &
The
ceeding hanging in the air, and that having instituted such
a proceeding, the Commission was in duty bound to enter
a final order terminating it at its conclusion. ,
"It is true with respect to the instant
(Continued on page 251)
are
interested iri
•
.<
is
/
-v
''
mmmmJmmm
Member?
New
York'Security
32 Broadway
NEW YORK 4
Newburger, Loeb & Co
WOrth 2-0300
System Teletype NY'1-84
by-laws that
Alegre Sugar
Eastern Sugar Assoc.
offerings of
High Grade
Public Utility
?
S. Sugar
and Industrial
Pressurelube, Inc.
^
PREFERRED STOCKS
:?'-v",
.
&.*•
,
"
^
.
*
,
"
'
4
'
•
n
•"*
^
t*
*
'
r'
; '
Spencer Trask & Co.,
25 Broad Street, New
I:
r
Members New York Security
25
York
Broad
Dealers
Board of Trade
Private Wire
to Boston
Public National Bank
&
American Bantam Car
Trust Co.
Republic Pictures
Income 4s, 1965
■
Common and Preferred
■»
t
-■
:
•
•
•.
.•
'
♦t.
-
..
■
•*
[
Bonds and Odd Pieces
';v.
•'
National
Bought—Sold—Quoted
.
Horr.RSSESTRQSTER
Harrison 2075
York—Chicago—St. Louis
Angeles
<
r''i
Bldg.
Teletype CQ 129
Established 1914
C. E.
vpr\Vinr>o
Trinity Place, New York 6, N. Y.
ROwMn?
Orppn
9-7400
Teletyve* NY 1-375
Analyses available
- to dealers only
Unterberg&Co.
Members N. Y.
'
61
74
Radiator Co.
'
Asa'n
I
NY 3-956;
York Stock Exchange
Members New
CHICAGO 4
Kansas City—Los
Dealers Assn.
St., New York 4, N. Y.
WHitehall 3-0272—-Teletype
Teletype NY 1-5
Telephone HAnover 2-4300
Direct Wire Service
New
WHitehall 4-6330
Bell Teletype NY 1-2033
Members NewYork Security Dealers Assn.'
170 Broadway
Lea Fabrics
STRAUSS BROS.
DIgby 4-8640
Teletype NY 1-832. 834
40 W.U St., N.Y. 5
Est. 1926
inn & lo.
HfRlOG
■
'
I
Billings & Spencer
Punta
We
v
Corp.
Sargent & Co.
Upson Company
,
II Members New York Stock Exchange
Ang.
Bausch & Lomfo
Bell
-
_
Thiokol
Mr. Kole said:
Lawyers Mortgage Co.
Prudence Co.
Los
&
Ktngan Co.
Edward A. Kole, attorneys for the petitioners, contended!
that the Commission was without authority to leave a pro¬
in
Kearney & Trecker
Billings &Spencer
Grinnell Corp.
.'.
N. Y. Title & Mtge. Co.
\
1-2733-34-35
Chic.
Haloid Corp.
parties having represented to the court that the
was a novel one, Abraham M. Metz, and
,
Mtge. Guar. Co.
Lawyers Title & Guar. Co.
NY
TRADING MARKETS
issue of law raised
Gisholt Machine
neces¬
dealer
2-4785
Teletype,
DUNNE & CO.
nor
slight changes in book¬
The
System
Private Wires 'to Boston,
The Argument
for large investment organizations
does
Reilly & Co., inc.
•
of the National Association of Securities Dealers.1
This decision poses no problem
fior
Request
on
■
States District Court in New York, argument
financial prob¬
(Continued from page 248)
Teletype' WH 1-1203
Schram be¬
Chamber of
Both the Commission and the Dealers Agree
day con¬
possibly h remain
6, N. Y.
HAnover 2-8970
Dealers Citadion ol SEC Aigu«
personally and
a
*
^TENNESSEE GAS
securities dealer in Maryland, who desires
,
;
Univis Lens
to
Commerce, Jan. 16, 1946.
as
evidenced by the revival of activ-
letter from a small
his identity be not dis¬
closed, "as to do so might bring to my office SEC officials for exvamfnation every, month,'and my business cannot be conducted With
such interruptions?; 5
Editor, "Commercial and
•
;
Financial Chronicle":
:
threatened with exti nction, which
j Your editorial concerning the may be what the SEC wants. Of
SEC's latest raid on small dealers their zeal may be traced to the
*
Visking Corp.
.
The "Chronicle" has received the following
v
"...
1
:v; These amendments provided for the registration with
salesmen, traders, partners, etc., and also em¬
Anonymous Security Dealer, So Holding, Writes "Chronicle" 'That :
powered NASD Governors, in the future, to submit by-laws
There Is No End to the Ambitions of Self-Appointed "Saviors of
to its membership as safeguards against ^unreasonable prof¬
Humanity" and Urges Large Houses Not to Sit By and Wait for
its, unreasonable commissions, and other charges."
the Next Atomic Bomb.
*
t
,
Works
Dye
"•
M
Taylor Wharton Iron & Steel
the NASD of
1
Artists
Piece
of
renewed
market,
That
many
Being the v£ry sensitive ther-
.
United
United
imr
is creating
inflation..
-
\i
YORK
NEW
many
an
cial ;> life > of
the
STREET,
Telephone WHitehall 4-6551
such
enterprises
that the stock market
commer¬
in
our
people turns around the problem
factor y in
as
y
listed on our Exchange.
question that appears to be
The
important
.
:
those
as
market
—relati
the
'
Request
on
t:vf
ity there after a prolonged period
of dullness, a number of ques¬
tions are being raised today as to
the significance of the increasing
an
SEC's Disclosure Philosophy
Would Doom Small Dealers
j
change.
For,
though "New
York"'is part
a
TEX
York
Stock
a s
-
REALIZATION CORP.
99
of
(Continued
MAR
?
It is understandable that people all over our country, no matter
half ago, in elaborating on
determine the prices
*
j
i
As- 1
Other Securi- I
Only if Inflation Is Avoided.
how distant from New
which
commodities, wrote in "The Wealth of Nations" s(Bk.
I, Chap. V): "It (i. e. the price of a commodity) is adjusted
Creator of
Unnecessary Controls Over Our Productive Capacity.
,
supply and demand factors, have been es¬
tablished.
It was Adam Smith, who over
a. m. sakoiski
<
a
Inflation, but a Thermometer Reflecting the Public's Views Con¬
cerning Our Readjustment to Peace. Stating That the Prevention
of Runaway Inflation Requires a Most Resolute Government Attitude, He Urges Realistic Fiscal and Labor Policies, and the Aboli-
to
omists and
:
v
r
as
as
*
Stock Exchange President Regards the Market Not As
Full Disclosure
*
""
r\'
President New York Stock Exchange
By A. M. SAKOLSKI
^
243
Security Dealers Ass'n
Broadway, New York 6, N. Y.
Telephone BOwling Green 9-3565
Teletype NY 1-1666
j
THE COMMERCIAL-4 FINANCIAL CHRONICLE
|
1
ACTUAL
Iioan Ratification
MARKETS^
IN 250
;v
Britain Faces Peace
British
-
Thursday, January 17,4946
y
1
ACTIVE ISSUES
INDUSTRIALS
j | Air Cargo
if
Transportt
American Bantam Car
jl
Com. & Pfd.
|l §|Bates Mfg.t
|
S. F. Bowser
■
Cinecolor, Inc.
.
Dayton Malleable Iron*
Du Mont Lab.
"A"|
'
Douglas Shoe*
I
Finch Tel.
I
Fresnillo Company
|
Gfc Amer. Industries*
|
Hartford-Empire Co. 1
Kaiser-Frazert
Herbert
Morrison
Kingan Co.
J
Mohawk Rubber
I Natl. Vulcanized Fibret
I
Pantasote Co.?
|
Polaroid Com.
|
Sylvania Industrial
Taca Airways
I
United Artists
■
■
,
Union Asbestos & Rub.'t
r
I
•
Waltham Watch
Warren Bros.
TEXTILES
Alabama Mills
Aspinook Corp.
Textron Wrnts. & Pfd;
COMMERCIAL
The
United Piece Dye
Reg.
Moore
UTILITIES
Drop Forging
Kaiser-Frazer
|
American Gas & Pow.
j
Iowa Pub. Ser. Com.
.
Iowa Southern Util..
New Eng. Pub. Serv.
I
North'n New Eng. Co.
or
Circular
upon
request
-
Publishers
Corp.
25 Park Place. New
York 8
'
Great American
Industries
J.K.Riee.Jr.&Co
[ ^Prospectus and. Special Letter Available
or
Special Letter
Established
Members N.
Request
art
Y.
twice
Thursday
•
a
/
issuef:
arid every Monday
York Security Dealers Association
:
(complete statistical issue—market qu6tation
• records,
corporation,
bankinp,
cleanings, state and city news, etc,)
New York 5
Hanover 2-7793
every
(general news and advertising
System Teletype N. Y. 1-714
FIRST COLONY CORPORATION
70 Pine Street
week
Published
f
1908
Security Dealers Assn.
2-4500—-120 Broadway
REctor
Bell
New
Seibert,
William Dana Seibert, President't
'
tStatistical Study
D.
William D. Riggs, Business Manager, i
-l
;■
i ■
Thursday, January 17, 1946 : :
;i
f American Insulator
fYork Corrugating
Herbert
Editor and Publisher
.^Electronic Corp.
tBishop & Babcock
fLe Roi Company
^Simplicity Pattern
Members
*Bulletin
U. 8. Patent Office
William B. Dana Company
Greater New York Industries
Stand. Gas & El. Com.
fProspectus Upon Request
...
-
REcior 2-9570 to 9576
| Puget S'nd P. & L. Com,
I
and
FINANCIAL CHRONICLE
Teletype NY 1-2425
Offices:
Other
135
S.
La
St.,
Salle
111.
(Telephone: State 0613 ■;
Gardens, London, E. C„ Eng¬
land, c/o Edwards & Smith- - •
r
RANDALL COMPANY B
Chicago
3,
1 Drapers'
.
PRESSURELUBE, INC.
WALT,DISNEY PRODUCTIONS
Copyright 1945 by William B. Dana
Company
j;
,A.
.
KENDALL COMPANY
-
.
/
...
.
•.
SHATTERPROOF GLASS
THE
FOUNDATION
COMPANY '
.
•
on
-
•••
.v:'v;
**.".'.'".v.' vV
request
Reentered as second-class matter Feb¬
25, 1942, at the post office' at New
N. Y., under the Act of. Marca
ruary
•
York,
3,-1879.
States ana
in Dominion
South and
Central
America, Spain,
Mexico, and
Cuba,
$29.50
per
year;
Great
Britain,
Continental Europe (except Spain), Asia,
Subscriptions
,
Possessions,
iof Canada,
;
SEGAL LOCK & HARDWARE 7% Pfd.
Descriptive Circulars
"•
SUPERIOR TOOL & DIE i
FASHION PARK, INC., Common
Members N. Y. Security Dealers Assa.
I
ILLINOIS TERMINAL RWY
WELLMAN ENGINEERING CO.
5
,
:
Australia
N,
Y.
Direct Wim;
1-1237-1288
to
Chicago and Phils.
Seligman, Luhetkin & Co.
Incorporated
ENTERPRISE PHONES
llartf'd CJ55
•
Huff, W£l
Bos. 2100
Members
41
BroacT Street*
New
York Security Dealers Association
New York 4
.
.
.HAnover 2-2100
.
1
/
$27.50
and
United
In
$26.00
per year;
per
Africa,
year:
$31.00
per
year.
Other Publications
■
V
'
Record—Mth.$25 yx.
Monthly Earnings Record—Mth.. .$25 yr.
Bank and Quotation
11 Broadway,,
New York 4
Teletype
Telephone
:!
NOTE—On account of the fluctuations
i
'
WHitehaM 3-4490
;
NY 1-960
j
in the rate of
exchange, remittances for
{'foreign subscription* and ndverttc
:
muci
made Jin New.. York funds.
.
Volume
Number
163-
4456,
THE COMMERCIAL, & FINANCIAL CHRONICLE
-
245
Our Foreign Policy
Enterprise's
or
Accomplishments Publicized
Wants Fiee
^
Dean
:
Has Failed to Tell American People the Glorious Achievements of
t;.:
Private Enterprise and .Urges van 'Advertising Campaign to Re; establish the ABC's of Economics:
Holds State of "Economic Literacy" in U. S. Is Low and That an: Era of- New. Enlightenment n
i: "Is 'Desperately Needed."--^
i
-vcv
;
prise
-
ind
trial]!
us
service
College
Commerce,
for.no
■SISl
medium is capable-of
one
to the battle.
"Through
.
■■; :
■
Foreign Policy and Continue Its Support of Free Enterprise
("Whether of a, Hitler or Lenin
Variety.",' 0utlines Seventeen Points in a; Foreign PoHcy, of the; ;;
1 United States Proposed Jby the National Foreign Council. / /,:'
E.
James
a-
McCarthy
*
•
-"
-"
billboards and radio " the
industrial clients must,; in; simple,
reportorial form, point-up the false
economic
denberg,
- for ?
Jto day,
had;"
me.
'
been
one
that v have
circulation—and without
concepts
^
clusion that
Patrick
eral
in
ment
near-compla¬
ficulties
the
John Abbink
the.
phras- r
ing of a Secretary of State recent¬
ly returned from Moscow. To my
oh
declared,
adroit
"has
failed, - jto tell the
American people the story of the
glorious achievements of Ameri¬
industry and the partnership
concept that every single worker
can
of
sources
wealth—and of
our
the part tools play and perform
in
giving us better food and shelter
and comfort goods than any other
people—and the rights and obli¬
coun¬
to
more
once
by
cency
the
Jan.
has resulted in what he described
plain what
"appalling low state of
among
people."
:
-
he
eco¬
the Ameri¬
in
part:
"We
must return to t elementary
things and employ the ABC's of
Economics—through the informa¬
now
part
the
tools—to
ex¬
in existence—
;
;
! /
■;
every
as
a
people we have
we
for
the
52
Bell
.
vM'
•
^
"Successfully planned antl suc¬
cessfully executed « we can make
our people literate respecting the
way jobs are created—what tools
do in creating more jobs and more
things and more comfort and more
and
differences
of
leisure—of
elements, in
our
of
en¬
couragement of venture capitalism—of the necessity of aceelerat-
".7
be-i
professing conflicting
political faiths, The essence, of the
tween those
roots deep
■
General Public
Utilities
develop¬
; international
ments that is ominous.
,
Common
In the circumstances a commen¬
tator
foreign policy who speaks
on
(Continued
on page
27!),••?
Republic Pictures
Common
Direct Private Wire Service:
COAST-TO
COAST
-
rr-.-f
New York
Chicago
-
SL Louis
*
«
Kansas City
-
Benguet
-
Balatoc
these
Masbate
San Mauricio
-
/.
t ;
-
,
United
Paracale
ilg:i$l'NEW YORK 4;:g/.
CHICAGO 4Wy.--
/
p
.
^
: f
DIgby 4-8640
Teletype NY 1-832-834
I
■
;
:
,
qAllen
Harrison 2075
Teletype CG 129
;
White &
KiftST.
i
KANSAS CITY
:;
Telephone:- HAnover 2-2600 ;? >')
LOS
Direct
ANGEUS#:®^
79 Wall St., New York 5. N. Y.
% Teleohonp HAnovpr 2-8681
Quarterly dividend paid January 15,1946
DIVIDENDS:
•
1945
Com.
:'V'
$2.25
—
1944 $2.75
—
Securities
MICHAEL
r
New Analysis on request
WALTER
Pfd.
&
II 11 Hon Rose STrsster
•;
• ;
;
New Orleans 12, La.
Carondelet Bidg.
Bo. '1-1432
v.;
.v.--;
..;;
ESTABLISHED 1914
"•
*
t
•"
Teletype: NY 1-375
Telephone: BOwling Green 9-7400
Asst.
'
'
.
Mgr.
' '
'•'•
'•
.
.
Exchange
York Curb
Members New
Chicago Stock Exchange
V
New Yo.rk 6
39 Broadway
Teletype NY 1-1610 :
Digby 4-3122
./i-
Farrell-Birminghatn
;
Consolidated Electric & Gas
Eastern
; v
Company
;
•
ANALYSIS
ON
Consols
Telephone Bond & Share
American Cyanamid Preferred
X."
Sugar
Associates,
:
Telephone Bond & Share
Common
.;V
Gulf Public Service Co.
Pacific old
common
&
preferred
Y.
H. & H. old
common
&
preferred
REQUEST
N.
N.
Petroleum
Gilbert & Bennett
Heat
&
Power
Preferred
7%
pfd.
Missouri
Co.
;
■
A
Class
"
.v
Associated Tel. & Tel.
7% -Preferred
/•;:
Associated Tel. & Tel.
4% Preferred
W. J.
Banigan & Co.
PETER BARKEN
.Established
1904
.
..
.
FREDERIC H. HATCH * CO.
,
'. 32
Broadway, New York 4, N. Y.
Td. WHitehall
4-6430"
J
-
Tele. NY 1-2500
50
Broadway, N. Y. 4
Carlisle, Pa.
••
H
.
I
H
<
i"
HAnover 2-8380
Scranton,
-
•
•
Pa.
'
MEMBERS n.
63
Wall Street j
y.
security dealers
New York 5, N. Y.
JAMES M. TOOLAN & CO.
Wall Street, New
67
Incorporated
_
association
Bell Teletype NY 1-897
;
Joseph McManus & Co.
,
74 Trinity Place, New York 6, N. Y.
;
HEANEY, Mgr.
KANE,
V
•
•
Bell Tel.—XY-1-49$
American Insulator
Common
...
Specialists in Soft Drink Stocks
f
r
41 Broad St.
"
.
& CO.
Members New Orleans Stock Exchange
New York 4, N. Y.
i
Approximate selling price ~ 30 Va
t
••
Carbon Monoxide
&
.
1943 S4.50
Securities Co. of N; Y. 4%
Preferred
■
Curb and Unlisted
§.75
—•
,
r
Reda Pump
l,:
Eliminator
Wires to-
Angeles and New Orleana~„
Los
PANAMACqCA^COLA
T. J. FEIBLEMAN
Co., Inc.
1-573
NY 1-1017-18 A
Teletypes:
Pledger & Company, Jnc,
-
n.',Y.
york a,
new-
Baum, Bernheimer Co.
Company
LOUIS;
■
•
STREET
BROAD
30
Corp.
Large and Small Certificates ',
F. BLEIBTREU &
&
Company
Established 1922 r*
page 267)
on
United Piece Dye Works ;
•
.,W
Board of Trade Bldg,
:fi;
■
,
■
Petroleum Heat
Los Angeles
^
32-• Broadway
Standard Fruit & S/S ••'■?-"
.
'
•
times, have their
Harvill
;
Mother Lode
.
»*y:-.«.
,
STRAUSS BROS.
contending
X Lane Cotton Mills Corp.1
Mindanao
;
-
-
Members New York Security Decdefs Ass'ri^-
Standard Commercial; Tobacco
;
.:
*.
& Power
Jeff. Lake Sulphur Com. & Pfd.
"
Preferred
and
•
in conflicting economic
(Continued
•,
^
: Toronto
Montreal
conservatives—between left¬
and .traditionalists,- and
,
Specialists in
Philippine Gold Stocks
HAnorer
Teletype NY 1-395
New York:
taxes
vigorously educate our people $£"That the state of economic lit¬
eracy among our people is appall¬
and
tell
them; of the glorious
ingly low and in need of clarity is
achievements
of American
free
manifest, I believe, and can be
Enterprise, and to educate them
well documented by the number
completely and honestly respect¬
of
disputes that have occurred
ing the merit and worth and value
during the past decade between
of what we have and of the des¬
management
and. workers-rrbetinies we can achieve in working
tween contesting labor; organiza¬
together toward a common goal:
tions—between
so-called liberals
the ? necessity
ST.# N. Y. 5
WILLIAM
to
ists
101,
FUNDS v;
S.
apathy among us
an
toward
rA
preservation of
and why
explain
them.
pay
U.
HART SMITH A CO.
hand, are forcing us to
our
lethargy, but
there is still
-1
7, 1946.
ciation-depletion and reserves ac¬
tually are and how they are made
work
'
•
at
]
it
jobs—to
\
■*'"
^
PAYAELE
plays in supporting our
commercial system—to explain in
to
-
dividend is and the
a
understandable terms what depre¬
M
said,
of
*
Callable
awaken ; from
*
gations of both the workers and
owners
;?.-V ' •
problems, and concurrent dif¬
with labor which loom
sion
has in the structure and anatomy
of American industrialism."
This
channels
"!
and
try been lulled jr
An address by. Mr. Abbink be¬
fore the Economic Club of Detroit,
tion
;
world,- created; by our military
industrial; might.,; Reconver¬
pointing—or talking down—tell .a
constant story of how we live—of
.,i;- Continuing,
»
100.50 New York
at
v;
to realize our predica¬
what is virtually a new
ficiently
J. Hurley ; nor ;
Pennsylvania, New York. • - j \
"Management," Dearr McCarthy
shouting—or finger-
or
-
passed through the period
of let-down from war tension suf¬
lecturing
nomic literacy
i
.
.
" ;
.
6% August 1,1947
I::
his
not yet
gained
can
:
;
All indicators point to the con¬
uniform, Gen¬
had the
index of the astigmatism of
;
X
hi
is
an
speech at the annual banquet of
the National Retail Dry Goods
on Jan. 7, at the Hotel
an
LTD.
is labelled •"inter¬
some
sections of
would-be detractors.
phase of the
subject : from
j diplcfmat
in
country—an appellation that
less a reflection on him than
Association
as
'.
the
testis';
.no
mon.y; on
now
nationalist"
Ithere.
that explosive
-
maga¬
newspapers,,
zines,
stated these
.f
coordinated,;
and
bringing sufficient fire-power in¬
Carthy.' who
is
a
leading
e?co jiomjst,
•\i
7
and: its; Opposition, to Fascism.
as
be achieved. Their efforts must be
synchronized
Mc¬
in
constituted
be
must
armies with specific objectives'to
University' of
Notre Dame.
views
«
^
Its Leadership in Proclaiming a
jdobP and radio and direct' mail | proposed
McCarthy
Dean
subject
prior sale:
-
-
of the
of
to
.
James
pean
E.
We offer
•
•of education, designed to
ted by
ca
Leading Foreign Trade Expert Calls Attention to Continuance of a
War-Tension"/.Which Is the Result of a Confusion of Foreign
.Policies- and Creates a Conditioni Bordering on. Chaos in Foreign
t
< r It. is with. some
misgiving that I venture to discuss the foreign
promote policy of the-United States on this particular occasion.
When your
economic literacy,, must start with IPresident ad————-—;
•further
discomfiture,I leariied
a, marshalling of all-the forces, of vised me some
advertising. And that every me¬ j weeks ago of
:only last week that , the - senior
Senator from Michigan] Mr. Vandium, newspaper; magazizne, out- the honor you z.
under-,
standing .and.
prosperity y in
the U hi ted.
States, "is. adpeace,
Vvo
»
.»
Definite
ed production,, since we may only
|have what;we produce. -- t':v v.:v
r'X am convinced that the Ostajrf*
jing point for a proposed campaign
i\d
a
^Fresident, Business Publishers International Corp.
-
.
further
thus
^
Trade./ Urges U.iS. Maintain
"Vigorous employment of newspaper and other advertising media
to educate therAmerican people on the achievements; of American
free venter-;.'
' -%-S,
'
*•
-
Chairman, National Foreign Trade Council,
^
;
■
V
By JOHN ABBINK*
McCarthy, of Notre Dame University, Asserts Management
Telephone
J-"",''
York
2-9335
Teletype NY 1^2630,
,
'
HAnover
■
'
#
.
-
L J
"...
I I
U
^
,
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J1
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246
THE COMMERCIAL & FINANCIAL CHRONICLE
The British Loan—
Should
Congress Approve Loan to Great Britain?
'V.M,.
A Good Investment
C.
U.
-ft$0ft:::
By HON. FRED M. VINSON*
ft
'
1
HON.
.By
By MERRYLE STANLEY
RtKEYSER*
•
WAYLAND
S.
BROOKS *
By PHILLIP D. REED*
■
International News Service
Sound World Economy as
a
Lasting Peace, Secretary Vinson Asserts That Unless ?
Part, There Will Be Renewal of Economic Isolation and
a
,
Mr. Reed Holds That if Loan Isn't
Financial; Journalist, Although r Fa¬
voring a Strong; Solvent v Britain,
Opposes
< the Loan
a Basis for
;
Because; (1) ItCdmes td Congress Opposed the Loan on Ground That
We Do Our
It Was Hatched in an Atmosjphere
Tied to Other Provisions; Such as
Restricted World Commerce.
Points Out - Britain's ^ Unbalanced J
of the Unreality, of Lord,
Agreements^?; on Lend-Lease Ac- Economic Dream World. Keynes'
Economic Position and the Need for Largely Expanded British ImRecom¬
counts;■ and Program5 for Future
ports as Well as Exports, and (Holds the Anglo-American Loan
mends That Great; Britain l"Sfop
Commercial Policy; (2) the British
Agreement Has Been Worked Out Carefully to Permit Removals on *
Don't Want the I Loan, but "We B^ing Fooled by Your Own Propa¬
Exchange Restrictions. Decries Criticism of Loan Made Both Here v
Force Them to Take It"; (3)iIt ganda, and > Make a Start Toward
1
and an Britain, and Says the Results Mark Real Progress Not Only
Genuine Recovery: by Facing Reali¬
Will .Be a Gift, and.; Not a Loan;
I
as "a Financial
ties." Holds Real Objection to the
Agreement," but as Showing That All Countries
(4)- It Dbei Not Give Us an Addi^'
Must Work Together to Maintain; International Economic Relations.
Loan Is That "It Is a Stone in the
tional Island Base; '(5) the Gov¬
i
The close of the war has brought to us and to the entire world
Larger Mosaic of Goofy Eco¬
ernment of Great Britain Is SociaK
hew problems that are difficult and important.
There is the problem
nomics" and Sees Possibility of
istic
and
Its
Leaders
Denounce
Our
of
reconvert-^
British Recovery By Using More
ing our indus¬ The very fact that we recognize Economy; (6) the Loan Is Unse¬
Stressing the Importance of Restoring
;
Chairman of Board, General
Electric Company
v.
Economic and Financial Writer for
Senator from Illinois
Member, Senate Commerce and
Appropriations Committees f
Secretary of the Treasury
Thursday, January 17,. 1946
Made to
Great Britain, the Pros¬
Senatdr. Brooks
pects of Achieving and Maintaining
High Employment ~ and / a Rising
Standard of Living Become Very
•
Dim. : Says Britain's Difficulties Ard
Temporary and That She Has Prof
ductive-
Forward
ing
level
of
pro¬
/
liberty
perity.
....
.
'•
■
omy
related.
the.
peace
United
And
the
:
.S tori rl g
world
shattered by six
structive
but
-
;
peace
ditions
throughout
can
the
I We cannot
high-level economy in this
peace.
k, ft
ft ^
.'VV''"
V"
9, 1946.
arid
it
not be
gether
We
?.
countries
in
were
and
work
to¬
prosperity.
opportunity.
economic
relations
aUowed to'break down.
(Continued
an
world in
a
that
its
277)
on page
In-
in for postand
grants-in-aid,
go
I
and
sidize
junction
with
country.
In
the agreement
finally
set¬
tling all leaselend
we,
;JfG
Sen. C. W. Brooks
r e a t;
;..T.
whereby
(Continued
Trading Markets
we
virtually for-
Over-the-Counter market.
•/
;•
•
.
•
.*
,
V
/
-
,
J
1 ;.
"
-*
-•
♦U.S. SUGAR
•'
Trading mediums include industrial, railroad, bank and
insurance; textile, public utility, real estate, investment
trust and New England issues.
*
Com. & Pfd.
'GREAT
a
Trading Department with
an experienced and effi¬
personnel of thirty-five is available for servicing
all
^
fti,
I
/v:.; V' ft-
^
INTERNATL.
;' '
DETROLA
trading inquiry.
KAISER-FRAZER CORP.
Wide and diversified trading contacts through 300
direct private wires to banks, brokers, and' dealers in
:*:K:
'!■ '.j
■■
New
York, Boston, Philadelphia and Hartford.
Further expansion of
personnel, equipment and
munication facilities is
rapid personal sendee
■
v
,
t
in progress to assure a
ft
\
all trading .market inquiry.
on
&, >*.•:•*
/-\
^
"''.V-
rx';..
'
„
"Circular
,'t,,
on
r;!
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Request
*
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v,
,
V *.'»■ Vv lJf?
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ft
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J. Arthur Warner & Co.
J. F.
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.
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120
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ft-,
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New York 5, N. Y.
Devonshire Street
•
question
and
Philip D. Reed
e;3: t o;
and
high employment
become very dim
a
of living
standard
rising
a
indeed.
«
Now, by what reasoning have I
Frankly,
come to this conclusion?
Here it
Reed,
J'm opposed to the whole ratmos¬ is very brifely:
phere of unreality of Lord John
Britain,
although
physically
Maynard Keynes' economic dream badly damaged by the war, and
world, in Which such schemes as
financially having gone from the
this loan
are
incessantly being
largest creditor to its
hatched for postponing the day world's
of reckoning.
Number One debtor, is still a
frendly ally
on
its feet.
Radcliffe
and
Mr.
then
disclosure
that
the:
(Continued
on
page
and
throughout
favorable
known
World.
Britain
the
went intd debt during the war to
countries
such
Egypt;;
India,
as
Australia, Ireland and Argentine;
she
because
had
to
buy heavily
se¬
\ * Addresses made by Sen. Brooks!
ductive Lord Keynes / would be
b'ack agqiruin a year to borrow
from our Treasury /169% of thfi
total
maximum
British - capital
•'
well
are
in 1944 that, if we kicked in $5,925,000,000. for the Bretton Woods
(financial machinery,, we would
fcreate
"a
brave
nqw
world"
through money management. At
Bretton Woods/ all the' delegates
had pbker faces; arid; theref Was
arid Messrs: RUkeyser and Reed at!
Town'Hall, New York, on Jari; 10,;
1946; at" "America's Town Meet-* J
irig,"' over the American Broad-)
casting System; ; ;
sv-re-:
(Continued
266)
on page
266) V
UAnover 2-4785
^Y^
/
,
,A
■?,
■
-r
■
„v\
f
'
,
'
TWX-BS 20S
private wire? between New York,
Philadelphia;
0m
System'Teletype, NY 1-2733-34-35
\ Private Wires io"' ",f
Boston and Hartford
,
Boston. Cbicayo &
;
,
?
We
jLos^Angeles^jr^;,
are
pleased to
:
-hold manufacturing company
(
b 1
maintain peace,
this
about
••
prospects ;
being:
our
Dealers Assn.
New York ii
Exch^
Boston, 9
-
LAfavette 2-300
Direct
New York Security
TWXNY M950
a
ppritribution to the: Bretton Woods
Bank; and Fund; comb inedr
Reilly & Co., inc.
>
real
;
not
achieve
plish, the- objective; of putting,
Members
Broadway
COrtlandt 7'9400
B9
\
\
interest,
proposed line of credit of $4,400,4
000,000, is whether it will accom¬
rio
Bought—S old—Quote d
com¬
-
now
•
the
of
,
TELECOIN CORPORATION
'-v
national
own
do
-
Let's; call the roll.
First they great manufacturing and trading
gilded the lily -by. calling our war¬ nation.
She has technical skill
time
grants-in-aid
E3STD- and
experience, and her products
LFASE." Then we were assured
AMERICAN
INDUSTRIES
cient
our
Senator
266)
on page
of securities traded in the
coverage
we
make the loan
Merryle S. Rukeyser
of course, want a strong, sol¬
The
the
States
Britain
that-is that if
m
vent Britain.
accounts
betweeh
My answer to
nicer
a
:
Britain?"
to
think t
con¬
"but
say,
proposed loan
•
could sub¬
sented in
United
V
don't
we
n g.
y o u r
what has that
intend to
pre¬
i
v
"Right,"
will
to do with the :
war giving
on
be
'
1 i
f
a
Ameri¬
we
cans
ri
c a
was
will
and
Complete overall
the
merits.
It
had
we
could
peace
muffed
International
' ■ •
war
me r ■
and | a
rising
standard
for
historic
-
if
pre¬
:
employment
of
King
George III. On
the
contrary,
will
so
high
peace,:
sins
on
merits
own
i
:
of Political and Social Science at
Town Hall; Philadelphia, Pa., Jan:
its
crucified
the
want most are
want
friendly
to
be)
.
ally
t o
Parliament
don't
our
British
Congress
which
son
presented
the
I
not
A
I
♦An address by Secretary Vin¬
before the American Academy
,
■
/
,
was
economy.
opportunity to build
3t
It
country
a
After the last
problems before.
First:
to
solved difficult
r
world.
enduring
throughout the world
lasting
perity in this country.
\
inter¬
have
we
have "no reason to
be disheartened. We have met and
%
are
Without a stable world
Neither can the world
economy be stable without pros¬
war.
ficult.; But
^
pros-
sented
have
All of these problems are dif¬
—
and
-
-
Neither
prosperity
of de¬
of
-
We cannot have a lasting
without good economic con¬
without
a
econ¬
years
•
these problems
All of
problem of re-.
Secretary Vinson
Binder to Hold
.
cooperation of
is
-i
»>
many reasons.
making, a,.last¬
ing
peace
through the
there
Granted, Which'
as a
United Nations Together.
intensely interested in neigh¬
am
Looks
.
,
the problem of
Nations.
I
Loan Can
we
:■
in¬
There is
come.
to* succeed. No doubt
\ way
duction,
em¬
ployment, and
national
Many Similar Loans, and (7) the
Is
Trade Will Act
father of four young sons,
a
a
Loan ls Only a Stop-Gap Arrange- borly discussions of anything: de¬
Let us look at this question of
shall
make some, mistakes; but we shall ment and Does Not Meet the Finani signed to prevent World War III. the British loan in terms of what
not repeat the great mistake we
cial Needs of Great Britain.
\ Certainly in
it
means
to us here at home'.
made aftet* the last war—the mis¬
v-.v::J ■'>
ft: ftft''ft1"
taking a posi¬
I am opposed to the loan of $3,- tion
on
Everyone will agree that three of
the
take of' doing nothing. We have
the things we
;
learned a great truth: eternal vig¬ 750,000,000 to Great Britain for prb p o s; e d
AnaerVc a n s
British
ilance is the price, not only of
loan,,
high
a
Productive Methods.
As
Her
Restore
Increased International
to
Trade if Loan
.
Forerunner of
•
Controlled Economic .Blocs/.
;
cured ; and Will Be
to
i
Partition the World Into Politically
-
tries to peace¬ ! them, that we are prepared to
time needs deal with" them, is an encourag¬
and maintain¬ ing indication that we are on the
Powers
Prosperity but Without
; Wfr believe»cement
Refrigeration Equipmenty # **".
A low priced speculation
WE SUGGEST
'
*
PROSPECTUS ON REQUEST
franklin
county
.
'
»
'
ERNEST L1ENHARD
■';
Has been released from - the: Armecb: Forces
^I Consolidated Cement
coal
-
■
Oregon Portland Cement
L
'.X1-
•.
-1-
,
,
'•>/
:
and has rejoined our
:
Trading; Department
'.■■■-■'■ft
v;
; v,i '-.
s;
.
ft;.- Riverside Cement
common
thai
"'ftft''.'ft''ftftftftiftftftMMftft
operate at capacity for several years.
Manufacturer of Electric
ft.ft
companieswill
announce
■
Vv;;- :v;~
'■
.
v :■
1
■?-.
^ '*
*"
:>
>
4
■
v>.,/■
•>
'
CIRCULAR ON REQUEST
\
M
Spokane Portland Cement
»
Troster, Currie & Summers
-
\
F. H. HOLLER &
CO., Inc.
Members N. Y. Security Dealers Ass'n
111
BArclay;7-0570
:
r
j
NY 1-1026
,
Circulars Available
I'...
LERNER & CO.
.
BROADWAY, NEW YORK 6, N. Y.
'
{.ft
' r-
Inactive
;.:?-...
74
Securities
;
,
.:
Tel. HUB 1990
v-
ft-ft
Teletype BS
69
Members Kew Ycrk Security; Dealers Association *
Trinity Place, N.Y.C.—HA. 2-2400. Teletype NY 1-376-377
10 POST OFFICE SQUARE
BOSTON 9, MASS.
:•
V Private
tiires
to Cleveland ;
-
,
Detroit
- £
Pittshurgh
.
*
>
St. Louis
?
it
Volume
Number
163
THE COMMERCIAL & FINANCIAL CHRONICLE
4456
Ernest Lienhard Rejoins
Troster, Currie & Summer#
HON. HENRY A.
;[r, By DR. WALTER E. SP4HR* ;X^
University
Professor of Economics, New York
Economists'
National
pahr Reviews ;tFe:[feee Bills
Conditions, i.e.,(the;
Introdruc^fidl )|ii
Which
s
.
•t
;;
;'Tull'Employment," Will Lead
:as
Xi.an
[House Bill, Which Eliminates the '? Necessity of Calculating a :
Ppppj
'
bills,
.Three
«.
<
involving -the so-called
fuli-employment question^
considered by Congress:
Yl! The Waff(
committee,
ner-Murray
11,. S. 380,
♦
-which passed
thd Senate in
the major
modified form
*
-and
to
•
■I
'
(2) The
so-
t called Patman
Bill,
*
H.
the
m
R.
not
except
[for minor differences, iden-
the
Full-Employment
-original
Sen¬
ate bill S. 380.
Dr. Walter E.
Spahr
P$§ (3) The Employment-Production bill prepared
•
were
that
read
lines
the
between
material is in the nature of
or
these
men
of
little
faith
in
*
.
'
;
Em-
ic
let alone work with Government;
that
or
the
if
even
farmers
wouldn't
'they
their plans;,
agree,
a pre¬
did
because
visability of trying to legislate un¬
employment out ' of existence
centered around the provisions of
*H£R. 2202 and the origihal S. 380,
trusting
[It!& in the notions involved in
'those bills that
we
find the issues
John
it
is
employed ex¬
We
d
of
Kentucky
The
Murphy Partner
Company
In Widmann &
^.[/(Special to The Financial Chronicle)
& Company,
Murphy has re¬
Widmann
in
mann
Carew Tower. Mr.
cently been in the armed forces;
prior thereto he was associated
with
Widmann
Mr.
in
the
| department.
de¬
preamble material ac¬
curately when he said that ". . . it
required a master-mind to think
up and write out all these prom¬
ises
It is nothing short, of Utooia
•
has
minded
little
men.
Down
time
for
.
supplements previous editions which
institutional investors."
by banks and other
[
^
^n^addition to outlining the Government's financing
,
steps5 taken from ! 941 to the conclusion of the
war,
this publication lists price and yield indices
well
as
today
annuo! review of financing
our
found of much value
were
burden. This nation of free people
scribed this
1945 Review of
edition of
tribution. It
nation must have more
as a
new
other
as
little-
of little faith.
pertinent data for various tax
maturity groups of U. S. Treasury
types and
Obligations.
through history, postwar.
Copies available to banks dnd other
institutional investors upon
request
*
;
■
„,
Modified S. 380 and "practically
"all of H."R.'2202 and wrote anew.
Bill-(galled the RmployinCht-Px^duction Act of 1945. This bill is
v
C.J. DEVINE & CO.
INC.
[f [ [
'now in conference committee;of
;
Sp0CtaUsfs in United States Government Securities
48 Wail Strefet, New York 5, N.
'-the House and Senate.
■v
'Senate [bill,
The [modified
as
C, ORTDN, JR.
WILLIAM
passed by the Senate, had prac-
HAS BECOME ASSOCIATED WITH
was illThe new
^Employment- Production |bill
^avoids the serious mistakes I in
House bill
The
advised
and
<,';<?&'.■
-
•
•
•
Fhifadolphia
2202
dangerous.
AS
MANAGER
OF
.
St. loult
;'..s
-
■
BotPen
'
ftically nothing in it tov commend
it.
■-■■■■
Chk«fio
•
f■
Pittsburgh
Y.
'"■£i
,
Cftveland
•
Son Francitca
•
Cincinnati
;
4
US
OUR
DEPARTMENT
UNLISTED STOCK
| these bills and should enable ; the
-
Federal
f
•
Government
-
to
$ ac'com-
Bendix, Luitweiler & CO.
[ plish all; that can reasonably « be
expected from legislation designed
to prevent or[to, .reduce,,an un-
•
4 [Sesirable^amount [ of Unemploy¬
ment.
members
5 2
v.;
r
v'-.
" •'
-
^
\
Telephone
new, .york .stock
WALL
i,
P
ST.,
■"
xj
HAnover
{
•}
'•'
4
2-S8ZQ.
S5ilMElADY:BCo4
exchange
NEW YD«RK
jv->v
5f
1
.
N. Y.
\
,
Teletype
'
_
"
,
will be?
'•'•■r'X\P'p/•'
*' v-i
f
* •* /
»"
"* t''\ "
Members New York Stock Exchange
W WAlL SfREET
summarized^briefly : after
•»'-*.
•••-.
NY1-5D1.
| [[Tlie^provisionSiOf this!ast; bill
;
•
r'!
«
>
*(
j^ve have examined some: of * the
41 jmajor ,issues that. have 5been, arid
,
!
-
NEW YORK 5r N. Yi
.
'-
[
:
;
still are,
'h 'PPP
The undersigned announce the
::iwith:the, proposals involved,in vHV
and the Senate's modified
| S.1380., It is particularly .desirable
a$e
of the above firm to conduct
■['
-
t« HAS
'strong elements in Congress and
;in administrative
:..
circles who hope
,iq
>
BEEN
ADMlTf ED TO ^feNERAL
V">v>-;.' •*r' V/-}-'" **vr.\;..FW'-v
[
^
■y
| of these bills'
;
|
;
fore
address
the
>
'National Retail Dry Goods Asso¬
ciation,
Jan.
10, -1946,Vat 1 Hotel
Pennsylvania, New York City.' ;
a
.--v-xpy P
!. MELADY
ARTHUR V. CROFTON
W. C.
by Dr. Spahr.be-
Congress,
1
WILLIAM
as they can in the
the conference
Controllers'
,
(Jefteraf Investment and tommodifies Bustft^St
new one now. in
0>An
[y '.p
PARTNERSHIP tN'OUR FIRM
jto insert as many of .the provisions.
[1
formation
MR. -HENRY iF.NWARREN, JR
I that " this „be done since there
lr
1:
.before Congress and the
jcountry:irf connection; principally,
|R.- 2202
Telephone: REctor 2-6300
•
115
BROADWAY
>kfeDfeRIC C^ SHIPMAN
Langley & Co
NEW
JOHN MELADY [Spedctf:
YORK
'January 13, 1946i
-
CINCINNATI, OHIO —Ronald
F. Murphy has been admitted to
partnership with Albert C. Wid¬
operations and price records is now ready for dis¬
that need: clarification. ' By con¬
'"An address bv Secretary Wal¬
centrating on them we should see itself. Nothing is omitted to be¬
'more clearly what the Senate did guile the unthinking," (Congres¬ lace before the-Triple A Regional
in its modified S. 380, and what sional Record, Dec. 15, p. A5968. Meeting on, 1946 Agricultural Con¬
The new House bill also contains servation Program, St. Paul, Minn.,
[the House Committee did when it
Jan. 10, 1946.. X,. ;
*
[' b A" i (Continued on page 260)
; *thine^[but * pr&ctibdll;y[- M
;
Ronald
profit
FINANCING OPERATIONS
tHe problems that impose on us
today such an ominous; postwar
Representative
public.
Robsion
mislead
to
used
Theatre.
UNIIEDpATESjGOVERNMENT
out
carry
ployment bill, H. R. 4181; on Sept. tensively in Washington in recent of this; mutual confidence-^more
25, but it received little attention- years, cannot be defended in leg¬
of, this neighborly -effort, like a
islative law; and it is dangerous
and ban be ignored.)
we. are to solve
Most of the discussion of the ad-
to
•
that you; couldn't get a bunch of
farmers to agree with each other,
P,
theJJ. S. Army in the European
process-
s
device that has been
James
—
resuming his activi¬
similarity as
Hcerjr A. Wallac*
the democrat¬
'
Full
a
is
manager
fegi-
on
i
of the Municipal
Department of Glore, Forgan &
Co., 135 South La Salle Street. Mr.
Jamieson served as a major with
as
mentation.
*
introduced
ILL.
CHICAGO,
ties
after
by the Hotise Committee on Ex¬ amble; and, were that bill passed,"
Well, you know, the record. You
penditures of Executive Depart¬ such material would not be. law men of
Triple-A did have faith in
ments after hearings on the other despite the fact that it follows the
the democratic process. We went
two bills, and passed by the House enacting clause. The general pub¬
ahead.T Y6u;; did ' get [together and
on December 14 as a radically re¬
lic doubtless does not understand
you
stayed, together^-and• you
vised S. 380.
this fact.
worked
in
harmony with
and
(Representative LaFollette of
"Legislating by preamble," < a through your Government.
'-Indiana
.
They said —
from
automatically
less
would
it
bring
calculated to win approval
or
would
it
.
Glore, Forgan & Co.
Jamieson
happened to the price
the
Napoleonic
Wars1 and after the Civil War; I
told, the farmers that these things
did not have to happen again-^-but
that they would happen, inevi(Continued on page 264)
work—or
not
the dangerous implications
involved.'. The principal device
employed to accomplish this aim
was the incorporation in the bill
of a lengthy declaration of sup¬
posedly-admirable purposes. Such
tical with the
-
society.
re
said
chiefly'^lay ap¬
grasp
•
free
a
[■
——p—.
Jas. Jamie son Rejoins
from
(heir, past experiences. Back in
early!919 just after World War I,
as some of you may recall, I wrote
a
piece in "Wallace's Farmer"
structure
and
■:;
the failure of peo¬
as
everywhere
about what
laymen who would not or could
was,
-
remarkable?
ples
ple-A began,
2202, apparently grew out of
fact .that it was drafted in a
more
which
much
what
scoffers who
manner
in the
*2202
[House,
so
a
proval given the Patman bill, H;
R.
don.e
problems have had
City,
Lienhard
forces and has rejoined their trad¬
ing department.
•
'
provisions of the Sen¬
wide
The
/
X'When .Tri¬
'
■
that: has
can
accomplish in
bill.
the [ House
! for consideration.
PPPPti
■
r*
to support at [least
ate-modified
gent
was
1
f President, Truman planning
the conferees
:
■
!
democratic
originally urged support of H. R'.
2202. On December 20, he "urged
' B i
tion
to prove
:
"v-,:
1
'
/
.
»,
t
York
Ernest
that
has been released from the armed
is-always good to" be back again with old friends in Triple-A.
Every one of y.ou knows how proud.! am of my long association with
an- organiza-
[National Budget.['P-M:
"have been; or. are being,: seriously
^Economic Charter."
New
Place,
announces
gressiona! Candidates That Favor President Truman's Full Employment and Other: Legislative Measures; -Calls Full Employment Bill
n'
Dangerous Guesswork.
on
Trinity
■[.„
,<
»
Givfes Illustrations of.v ,
Erroneous Government Forecasting, and Sees Little Harm in the
Action Based
to
Troster, Currie & Summers, 74
■
>,
;Which Must Remain the' Seedbed of Our Free Enterprise System,
and Urges That Farmers as Well as Urban Voters
Support Con-
'
There Is No Accurate Data on H
Comprise 1he "Budget" ahdThat Lack of Agreement
Economic Concepts, Such
_
as
:
:
•
So-Culled:NatidnalVBudget." Maintalns^i
Feature Is Unworkable
[
Secretary Wallace Calls Attention to the Agricultural Depression
Following World War I and Contends That This Need Not Happen
Following the Late War'if Full Employment and Large Industrial
Purchasing Power Can Be Maintained. Holds the Core of Independent Citizenship in the United States Is Still the
Fanning Population,
"(
-
So-CaIIed<TulIEmployment"Question, anid Points Out That ;
Major Defects of the Administration'$ Bill Which: Passed Senate
Modified Form Is Its Requirement of a Forecast of Future Eco- ?
nomic
:
of Commerce
v
Committee on-Monetary Policy
WALLACE*
sales
Thursday, January 17, 1946
248
SEC's Disclosure Theory Would Doom
(Continued from page 243)
appointed saviors of humanity.
business if. all he can make gross They would be wise to put all
on a transaction in bonds involv¬
these forces "into" this thing now
ing $10,000 is $25.00.
v# ,, L
1; am awaiting with eagerness
the opportunity to contribute time
or -money- to^fight. this matter to
a
standstill,- win or lose.
I. am
hot going to give up my livelihood
business# willingly or
without trying to do everything
I can to: retain my identity*
,I
wish, too, to point out to the large
affected
that if they do
not come in and help ».now, the
next turn of the wheel will bring
their turn up—who knows what
will follow this latest raid? Their
by this decision
there
turn
will
is
end to the ambitions of self-
no
surely
for
come,
not desire to have his
vealed.
business
our
houses«as
their
lays ' waste
this
threatens
one
destroy - the; little fellows.;,'
to
article
the writer
of
the
above; letter ^refers to} appeared
•In the Jan; 10 "Chronicle"
bore; the
caption, ''A
and
Self-Ap¬
pointed Legislature," and there¬
in
the
opinion
expressed
that the SEC lacked the power
was
to change trade custom by com¬
pelling
on
dealers
an
basis
to
agency
do
'
"
*
disclosing
their
such transactions) if
they did not own the securities
on
solicited
The
from
their
"Chronicle"
Interested
ments
Bill
Drug
f
1
cus¬
above
,
would
receiving
other
be
com¬
dealers
theory, which
on
was
espoused by the SEC in the
so-
Common
-V - h
'
in
from
Fidelity Trust Co. of Bait.
"■
'
<■
r,
'K'
»
v*
-
i
-
,,
CINCINNATI
Chronicle,
Place,> New
York
International Telephone & Telegraph
gradually acquix'ed
has
8,1
;#• From'the telephone calls and:
letters received by
Editor,
our
it is obvious that both big and
small dealers, and, as one dealer!
put it, from the "most angelic.
the
to
devilish,"
opposed
entirely
are
philosophy
the
to
*
question.
•
in
;
.<
,
electronics industry in this country.,. Organized
auspices, the stock participated in the market boom
of holding company equities in* the 1920's and advanced from 64 to
the equivalent of nearly 450 in^>
; ;■
"v
1929, being split three-for-one in United States and 17% in Euthat year;
It also joined in the rope); 8% in cables, and; 3% in
general debacle of the holding New York' City buildings.'- But
these
investment i\values
have
company issues,; dropping to 2%
Sosthenes; Behn, it has sur¬
recturring - troubles due. to
sharp shrinkage in foreign
currencies,
the • effects
of the
Spanish Revolution, and the devastingy-results of war in Europe
and the Orient. In the past four
Snyder 8 Co.
PHILADELPHIA,, PA.~Robert
J. Mason, recently, returned from
3*4 years with the Army Air
Forces, is now associated with
the trading department of Geo,; E.
Snyder & Gov, Stock Exchange
Biiiiding. members of the Phila¬
delphia StockExchange.
Prior to his entry into Service
with the Army, Air Forces, Mr,was
the
with
Insurance
the stock has recovered to
the
present
level
around
30,
Where it has remained stabilized
years
in
rather narrow range for some
a
months?
International Tel. is
CINCINNATI
Members New Ybfk;«& Baltimore Stock
Exchange;; and other leading- exchanges
study of
CALVERT
Beil
New
-
Telephone
-
Bag & Paper Co/
,
Rector
Common Stock
2-3327
Grinnell
BOSTON
Corp.
Griseliy
UNION TRUST BLDG.
CINCINNATI
Dwight Manufacturing Company
2
1606 Walnut
National Service Cos.
;
'
'
■
'■
■
'
'
-
'
-'
'
St., Philadelphia 3
Pennypacker 8200
Private
-
PH 30
-
Phone to N. Y. C.
•' ■"
'
-
;
*;
f
V
^
Dealer
WHEELOCK & CUMMINS
Parker Appliance
fnquirles Invited
INCORPORATED
Philadelphia Co. common
Waltham Watch Company
-
'4^ /
•
'
v
'«' / #,'' '■
' ,#%'#,• c,
/
Botany Worsted Mills pfd, & A
Iowa Power & Light Co.
"#
Empire Steel Corp. com.
.Preferred*
Inquiries Invited.
Central Steel & Wire
United Light & Rys.
Vinco Corp.
Preferred*
John Irving Shoe common
Rath
•
Packing Co.
*■;
Warner Co. common
H. M.
V
du
Pont, Homsey Co.
Shawmut-Bank Building
BOSTON 9,
ikpitol
EQUITABLE
DES
Phone 4-7159
9,
-
-
Byllesby & Company
PHILADELPHIA OFFICE
IOWA
Stock Exchange BIdg.
Bell Tele. DM 154
Phone Rittenbouse 3717.
.
'
Phila. 2
Tele, PH 73
other
they
years
treated
on
have
Girdler Corporation
properties such
and Spanish
Important
Rumanian
the
Stix&Co.
Hialeah Race Course
Louisville
Lime Common
Gas
in
manufacturing
in
(2%
an
trade
INVESTMENT SECURITIES
Private New York
m BANKERS BOND ™
:
'
St. Louis 1,>1o.
1st
Floor, Kentucky Home Life Bldr.
LOUISVILLE 2, KENTUCKY
i
Long Distance 238-9
Exchange
000,000 pesetas in 1944, but of
bourse these earnings are now
(Continued
page
on
Midland Utilities
;:Reda
;
Common Class "A"
'•
Capacity—-900,000 barrels annually.
•
Book value*—around $18.
Good
earnings
all
through
„
H.
5 <
Pump Company
12%
280)
Teletype BS 69
Properties
Los
York, Philadelphia and
Angeles Stock Exchanges v ]\
New York
in
*
those markets where
various
offices
are
located.
Paine, Webber, Jackson & Curtis
>
Street, Philadelphia 2
Los Angeles
Hagerstown. Md.
N. Y. Telephone—-WHitehall 3-7253
Private
Wire System
between
American Gas & Power common
Federal Water & Gas
.
»
J
General
common
'
(
\; yj: •
Public; Utilities
o't
•
'"/v.'
com.
common
v
BUCKLEY BROTHERS
Pittsburgh, Pa.
;
Request
Members New
1529 Walnut
& CO.
OFFICE SQUARE
BOSTON 9, MASS.
on
#
Philadelphia^ New York and Los Angeles
•
Northern New England com.
-
A. M. LAW & COMPANY
(Established
1892)
SPARTANBURG, S. C.
L. D. 51
;
private wire
especially equipped to
Midland Utilities
AND
;
Circular available
POST
Textile Securities
H. Robertson
"Memos
.,
about
Southern
war
period.
Company would benefit substantial¬
ly from tax reduction.
Oregon's
huge
highway
program
ready to start.
-v,';'
,
active market in the stocks of
Bell Tele. LS 186
SPARTANBURC
Teletype SPBG 17 !
fig¬
earnings of around 23,-
showed
•
Oregon Portland Cement Co.
1990
round
/ESTABLISHED 187*
Members St. Louis Stock
'
Tel. HUB
in
from
$164,000? to $4,221,000.
The Spanish investment, which in
1937 yielded profits of $2,116,000,
the
#
Incorporated
PHILADELPHIA
IO
increased
business
ures
STREET
■#"
.
Telephone
REctor 2-5035
569 OLIVE
•#
rH Federal Street, Boston 10
LERNER
income account.
public utility companies and through
system are
/I
frayton Haigney & Company
Market
readily tied in with the sys¬
the facilities of our direct
Pref.
Winn & Lovett Grocery
.'T A:'':.'
.
not
tem
*
The company's annual report is $1,623,000 in 1944, due principally
to the
effects of the European
quite, informative; the 1944 report
(page* 30-31)' gave a complete war; and the earnings of the big
German company. Standard Electable of alt investments in: subv
eric Gesellschaft, declined from
sidiaries. This indicated that 69%
of the system funds had been in¬ $3,392,000 in -1937 to nothing in
1944.
On the other hand, these
vested in
telephone enterprises
manufacturing losses were more
(46% in Latin America, and 23%
in Spain—now disposed of); 20% than made up by moving the Eu-
our
•
currencies and the.net results are
greatly reduced by sale of the
principal properties to the Span¬
hand the Latin American com¬ ish Government. The profits in
panies
have
pushed
steadily; International Standard Electric
ahead, and Federal Telegraph has (sub-holding company for world¬
mushroomed during the war into wide
properties
manufacturing
an immense research and manu¬
telephone and related equipment)
facturing business in New Jersey.; dropped from $3,253,000 in 1937 to
many
Submarine Signal
>
been
-
non-consolidated
a
We maintain
American .Turf Ass'n
Boston Edison
•
pany's earnings equity in, the
principal subsidiaries; even; this
could be improved, since some of
the figures are given in foreign
PUBLIC UTILITY STOCKS
American Barge Line
>;
Exchange) are more illu¬
minating, showing dividends re¬
ST. LOUIS
Boston & Maine Prior Pfd.
re¬
ceived from, and the parent com¬
LOUISVILLE
TRADING MARKETS
New England
The annual I0-K
MASS,
Teletype BS 424
4330
BUILDING
MOINES
cut division.
ports (on file with the New York
Stock
.
Common
,,
ephone, mahufactuitng and
interests; but the 1944 re¬
port does not make 'such a clear
cable
ment
and
currencies
telephone systems have been sold;
others have been non-operative
due to the war; while-on the other
;
.
Naumkeag Steam Cotton
■
te 1
many
different
dividends
must
as
DES MOINES
■■
properties. In some former
years the income account .was di¬
vided into separate statements for
However, the 10-K reports re¬
veal the general trend in system
affairs somewhat more accurately
than do the annual reports, al¬
basis.
-v
7-1202
COrtlandt
Preferred
'
•
•
and
dividends obtainable from the dif¬
ferent
which are systems in
their own right, and the complete
equities in these systems are not
always revealed in International's
reports. Earnings are obtained in
of
portant subsidiaries have appeared
in
the
consolidated figures, in
boenning & co.
Teletype CI 347
little relation to the earnings
though of course the textual comin the reports throws con¬
frequently
re¬ siderable light on System changes.
main buried in subsidiary treas¬ In comparing the 10-K report for
uries, due to exchange restric¬ 1937 with that for 1944, it appears
tions. In some years certain im¬ that
profits on the - Argentine
Common Stock
Horan &
large number of fac¬
a
The company has hundreds
subsidiaries
and
affiliates,
many
Southern Advance
SECURITIES
ST., BALTIMORE 2
Teletype BA 393
York
-p.-
difficult
a
company to analyze, and any fore¬
cast of earnings must involve the
of
STEIN BROS. & BOYCE
How¬
under the able management
vived
Company of North America.
'j
the, new
in 1932 and to XYa in 1941,
tors.
e S.
in
under Morgan.
the
Geo. E.
organized in 1920 and
a
of Col.
Robl. Mason Is With
was
dominant position < ip the telephone ^and
outside the United States,,as well as an, important
cable business
ever,
Mason
,
V'*
Financial
&
Park
business
brokerage
or
(thereby
profits
the
Emerson
'
"
International Telephone & Telegraph
Com-1
Editor,
.
tomers.
Davis Coal & Coke
to
role
The
was
Bay way Terminal
mercial
-
name re¬
Communications should
addressed
be
25
I
i
Piibli&tJtUWy Securities
published anon ymousl y.; if I
writer states that he does
the
bomb thrown by the New Deal at
themselves at the time the order
BALTIMORE
be I
and not wait until the next atomic
and % my
firms that are hot greatly
Small Dealers
called "Oxford case." They will
Gilbert J. Postley & Co.
29
BROADWAY, NEW
^
Direct
YORK 6, X. Y.
Wire to Chicago
,
*
Wm. K.
Barclay Named
Chairman of NASD
■
THE COMMERCIAL & FINANCIAL CHRONICLE
Number .4456,
Volume. 163
Wm.; K.
Barclay, Jr.,
£
,
By EMILE PAULINv--;v
Administrateur
I :
' Captain/ Ik S. Naval.'Reserve-;1;;'
-
i,'sU/
Prominent
Republican; Statesman Points Out That the Science of
f Government Has Not Progressed as! Rapidly as Other Sciences and
T Urges That Lawyers Take the Initiative in Reviving the Study of
I Government. Holds Science! of Government /"Needs New Answers ■'
:] and Illustrates by Referring to Political Difficulties in Effecting Slum
j Clearances. Points to the Current Scene of Industrial Strife as Furi ther Evidence That "We Need New Answers*1 to Maintain Our Sys;
.
;
;
I count it an honor to Tespond to your invitation to speak to the
American Bar Association at this first postwar convention, your 68th
Barclay, Jr.
V;.:V
■:
Harry W. Beebe
r'i -'v':
Association
; V''
-s-:v"■
of Securities
Dealers,
Inc., at the annual meeting at-Hot
Springs, Va. He succeeds Ralph E.
Phillips of Dean Witter & Co., Los
Angeles.
v'
••"•ci Harry ;;W/ Beebe- of - Hamman
Ripley & Co., Inc., New/York; was
re-elected
Vice
Chairman
the
of
Association; June S. Jones of At¬
kinson, Jones, & Co., Portland,
Ore., was elected Vice Chairman
to succeed R. Winfield
Ellis of Lee
Higginson Corpl, Chicago.
John
"
annual
^
s e s-
sion.
I have a
very
pleasant
sessions
conventions in
1941
world
I
Quail, of Quail & Co.,
Davenport,
Iowa,was
elected
treasurer; to succeed .Mr. Barclay,
Irving 0. Fish, of Smith, Bafpey
&* Co., New York, was elected
ture that
upon the out¬
standing pro¬
gram that the
that
on
of assist¬
government and to the people,
and in responding in the highest
Taking
Tuesday
office
were
at
the
meeting
the following new
members of the Board of Gover¬
nors:
Herbert F. Boynton of H. F.
to the call of service of this
sense
country and of the world.
I speak to you tonight to present
*An address
by Captain Stassen
Boynton & Co., Inc.r New York,
before the American Bar Associasucceeding Henry G. Riter, 3rd, of
tion, Cincinnati, Ohio; DecL;,19j
Riter & Co.; Robert C. Kirchofer
1945.
of Ivirchofer & Arnold, Inc., Ra¬
leigh, succeeding James Parker
New Orleans, and Wallace H. FulNolan
of
Folger,
Nolan: Inc.,
Washington, D. C.; L. R. Billett ton,- executive, director ex officio.
Mr.. Barclay is Chairman of the
-of Kebbon, ' McCormick &
Co.,
executive committee, Chicago, and Walter E. Kistner of
The finance committee of the
A. C. Allyn & Co., Chicago, suc¬
National Association of Securities
ceeding Ralph Chapman of FarDealers, Inc., for the coming year
well, Chapman & Co., and R. Winis as follows:
field Ellis of the Lee JHgginson
Corp., Chicago; Harlan Herrick 4 Irving D. Fishj.hf Smith, Barney
of the Lathrop-Hawk-Herrick Co., & Co., New York. Chairman; Her¬
Wichita, Kan., succeeding George mann F. Clarke, of Estabrook &
K;1 Baum of; Baum/. Bernheimer Co., Boston; Mr. Barclay; J. Rob¬
Co., .Kansas City; W* Rex Crom¬ ert Shuman, of Shumart, Agnew &
well of Dallas Kupe & Son, Dal- Co., San Francisco, and Mr. Fulton
las, Tex., succeeding J. Wesley 0X pfficio;'"•
Hickman of Schneider, Bernet &
Hickman, Dallas, and Joseph J,
,.
the
pound. These
rates will henceforth be applied in
metropolitan France and in the
following overseas French terri¬
tories: Algeria, Tunisia, Morocco,
the West Indies and Guiana.
Africa, / Togo,
French
:
science ^ of
government
industrial
Extreme
level.
that
pro¬
Ralph
SPECIALIZING
f E.
BROKERS
\
Mr.
Barclay
announced
ap¬
pointment of the following mem¬
bers to the. executive committee
as
there
It is easy to see, from the abovementioned
geons
figures, that the sur¬
have made a drastic ampu¬
al¬
tation of the franc organism,
a
France which/ evidently, could not
be envisaged without a parallel
comprising New Caledonia,
Hebrides
•
and
in
settlements
200 francs to the pound.
Such
the
devaluation protect
permanently
from
the
necessity of other measures of
Will
.
They will
the
France
this kind? Will it contribute effi¬
swift recovery of
economy?
:
The risk of being contradicted by
caciously to
;
a
the national
?
monetary s reform - expected
the Liberation and which
(Continued
,
.
on page
All of these results are related
the rapid progress which the
other sciences* have made by find¬
to
ing new^ answers. The remarkable
development of mass production
USEFUL ARE
HOW
\yith its new machines, and new
methods, and its unbelievable pro¬
ductivity of so much of the neces¬
Good
Security Analyses
sities and comforts of life for mil-
lions of people have resulted in
great, concentrated -industries,
with very large numbers of em¬
ployees and congested living con¬
v:
The
new
in
answers
YOU?
TO
AS A
DISTRIBUTOR, you are frequently called
travel, with the speed and range
of the airplane and of the modern
Ji \
on
for analyses of new issues—and the quality
ship
of those
analyses is therefore mighty important to you.
and
Of motor
the
new
the increased mobility
transport, coupled with
answers
in
destruction; have caused
•
of
means
to
Then
That's
wtrs
become; truly world-wide.
.
i
of
IN
SERVICE TO
DEALERS
our
made with the
an
eye to
we
of definite and
are
underwriter friends. Our analyses
offerings in which
are
-
in which
way
practical help to
h (Continued en ;page 273),
AND
one
same
we
participate
as
underwriters'
thoroughness and written with
clarity and investor-interest, just
as are our
other studies.
ON
.
Should
PACIFIC COAST SECURITIES
for. the coming year:
.
'
OUPTATIDNS
.Harry W. Beebe, of Harriman
Ripley & Co., Inc., New York;
June S. Jones, of Atkinson, Jones
&\ Co., Portland, Ore.;' John J.
Quail, of Quail & Co., Davenport,
Iowa; L. R. Billett, of Kebbon,
McCormick & Co., Chicago; Rob¬
ert S. Morris, of Robert S, Morris
& Co., Hartford; John B. Shober,
of Woolfolk, Huggins & Shober,
HANDLED
AND
OVER
EXECUTIONS
DUR
DIRECT
^
PROMPTLY
PRIVATE
have occasion to
you
analyses in the
near
future,,
use
w.e are
one
of these
confident that
you.
'
will find them
WIRE
as
practically helpful
as
have others.
Kaiser & Co.
^ U j-;;; mbmbeIIS
HEY YORK STOCK EXCHANGE
•
HEW YORK
20
STREET
PINE
NEW YORK
CURfl EXCHAHfiE
^
ff
SAH FRANCISCO STOCK EXCHANGE
5
15dd
russ
building
SAN FRANCISCO
A
rr:».
R. W.
Pressprich & Co.
ACTIVE MARKETS:
BURMA CORP.
-
Chicago arid
I desire to get
and ad¬
By
working
lieved
<
can
that
American
the
for
secure
siderably
it
together,
more
is
members New York Stock
Street, New York 5,N. Y.
telephone', HAnover 2-6388
201 Devonshire
Kingan Co.
holders
Common &
their
Receipts con¬
than: the present
\
'.Teletype NY 1-993
Pfd.
*
"•
^
Street, BOSTON 10
Members New York Stock
■
,
Exchange
Dayton Malleable Iron
GOVERNMENT,
Common
MUNICIPAL,
RAILROAD.
'
I.",.
Care American Consulate
Air
New York Correspondent
Howard G. Peterson
..
,
^
1775 Broadway
City. CI 6-0650. :
receipts have no vote
hence
there
proxies."
•
will
be
/
.
no
call
'
,
Cargo
Common
SIEGEL & CO.
"
and
for
89
Broadway, N.Y. 6
PUBLIC
:
V
1;;;
New York
•These
^
v
,
:\
Room 768
Id Broad
Telephone HAnover 2-1700
William, Street
NEW YORK 5
("B")
be¬
Madras, India
Exchange
associate members N. Y. Curb Exchange
yi-.f Common:.;7-ff
United Drill & Tool
Curb price. 3
...
Arthur C. Babson
;
BURNHAM& COMPANY
68
Industries:
'
pository Receipts"^ for the stock of
the'Burma Corporation.—
Continental
'
Great:American
''Mfff
anty Trust Company American De¬
Southern Airlines. Inc.
Airlines, Inc.
the^names
dresses of the holders of the Guar¬
DIgby 4-3370
Teletype NY 1-1942
UTILITY.
AND
come,
then to mind:
the main provisions of
are
national
Two" questions
economy?
thus enjoy in relation to the new
franc a parity of 240 metropolitan
francs per 100. of-their francs.
the' whole
of
recovery
Oceania will "maintain unchanged
the rate of their franc, that is t6
say 49.627 francs to the dollar and
,
ditions.
was
complete dis¬
regards the princi¬
ple itself of the devaluation: what
divided
them
was
simply
the
question of timing and of- choos¬
ing the best technique for a meas¬
ure unfortunately rendered inev¬
itable by the enemy occupation.
.
The French colonies in the Pa-
Ryons of the Pacific Company of
succeeding
agreement
that
a
ready seriously weakened/ The
parity of 170 question : now is: what are the
metropolitan francs per 100 francs prospects for the reestablishment
of these territories.
:of
the
financial
soundness
of
establish
the
behind the other
them
between
Saint-
as
Not
devaluation.
Camerouns,
Madagascar
well
as
be¬
of
controversy
tween advocates and opponents
mestic field.
,r
California,
the
Somaliland,
Reunion
shortage of millions of houses are since
two of the most striking examples
of ; the inadequacies of the ma-f
chinery of government in the do¬
,
*BhillipSUVA"vJ//u;'r^
;
the fierce
ends
The African colonies, i.e. French
West Africa, French Equatorial
ci fic,
duction Is most heeded and the
the
ance
tee and Wallace H. Fulton was re¬
.
are
both
-
at the very time
strife
Harold E. Stassen
Chairman of the Finance Commit¬
elected Executive Director,
the
world
,
to
There
in
world-wide wars
and a world-wide depression, in
a single generation, have been the
tragic cost of the shortcomings of
the science of government on the
through these
years of the
war
,
end 480 francs to the
and the domestic pic¬
point to the conclusion
has lagged far
sciences.
Two
Association
has carried
men.
scene
commend you
American Bar
J.
free-
indications
many
good
to be back.
of
ment
years,
and it is
has fixed the new exchange
rates of the frahc ih relation to the dollar and the pound sterling
119.10660 francs to the dollar^—[•.■
■.
.—"—-—i—-
Bar. Association
in the science of govern¬
answers
and pre¬
vious
the American
Basis for Security of Investments in France.
a
decree, under date of Dec. 27, 1945,
pierre and Miquelon, will be able
drid^ through" YOU^ to; the lawyers to"
exchange the franc quoted in
of America, a specific request.
It
their: territories, at the following
is thist I urge that in the years
rates: 70.96 francs to the dollar and
ahead you engage to an increas¬
282.35 francs to the pound sterling,
ing degree in the search, for new
which
the annual
of
A
and
to
recollection of
the
^ by the'Bretton Woods Agreements,' Precludes for a Time Any New/
Changes in - French Monetary Values. Contends That Although
French Imports Will Exceed Export* for Some Time, the Restored
Confidence of People" in Their ;Moneyv Will Maintain Its Stability
at
Organization.
•
•:
J and Will Furnish
,
Individual Enterprise,
j Calls for Legal and Governmental Backgrounds That Will Develop
| Strong, Sound, Responsible Labor Unions,: und at the Same Time
Maintain High Productivity, Good jh-ofits and Constructive Indus| trial Leadership. Says UNO Is Just; First; Step in International p
"N
"France-Amerique^
French Journalist Reviews the Recent Devaluation. of the Franc ?,
arfd Holda That the New Effort at Stabilization^ When Reinforced
'
of Free Workmen, Private Capital and
T teni
;-:v•?%'?*':■ f'-'c -v
General:;0f
■
'
-
■
Wm. K.
The Stabilization of the Franc
Science of Government
resident
partner in Philadelphia of Stein
Bros;
& Boyce, Baltimore, - was
elected chairman of the National
;
f|Wanted^;ltevival;;
249
INDUSTRIAL
INVESTMENT
BONDS
STOCKS
257)
THE COMMERCIAL & FINANCIAL CHRONICLE
Thursday, January 17, 1946
Reuss, 1 'Wall-Street, New York 5,
■'
Trading Markets
-v;:!
;
N.-Y.;£-7f
Dealerdtroker Investment
Recommendatiofii and Literature
United
understood that
»
C. L Schmidt & Co*
!»: ;•<
'Established 1922
CHICAGO
ijornga,'
Street, New York 5, N: Y.
^ich.
Association
;
Dealers
X
Pacific Coast
—
7
•'
For
!:
,/v!!:!'
.
.y ^
-
Sr
Y.
.
Bowser, Inc.!— special3 sMdx~
i ;f California Electric Powe^CbihX
tfany ^Detailed !anaiysis^ Max¬
well, Marshall &
Co., 647
Spring! Street, '- Los
South
Angeles « 14,
Calif.
tistical
the
of
dum
&
:
STV CHICAGO 4
.
Co., Com.
*Wells-Gardner & Co., Com.
Pfd.
Bequest,
~*Pro$pectus Available on
^elopments-^Lerner & Co.,
Post Office Square, Boston
9:
of
\Iass.
S Alsoavailableare circulars on
Oregon Portland Cement, River¬
Street, New York City.
method
Trends—A
s
Paul H.Davis & Go.
19 i6
Members Principal Stock Exchanges
Chicago Board of Trade
Chicago 3
10 So. La Salle St.,
Teletype CG 405
Tel. Franklin 8622
Indianapolis^ Ind.
Rackford, 111.
~
The
Chicago
available
Quotations — Pamphlet containing
350 quotations, available to banks,
insurance; ^companies
and other
institutions upon request—Domin¬
5 ee
u
ritie
s
Kentucky
district
com¬
mittee to
suc¬
ceed
Ford
We b
e
208
Street, Chicago 4,
is
available
Also
analysis oi
an
*
v
;:
,
^^lidland;ReaHzatioh:;.'an^:vMid«
Utilities
land
R.
r,;
o
f
Ford R. Weber
6
Co.
Mr.
Goshia,
has
who
.
been
21
in
securities
} for
years,
was
in'
partner
a
Collin, Norton
& Co. prior to
—
Memoranda
—
Doyle, O'Connor & Co., Inc.,
135
South La Salle Street, Chicago 3,
Utilities
Midland
dum
fiQr ming his
™
Oliver
(Mi.
own company.
a:
council
member ^of the executive
:
of
the!National Security:
Traders Association and is a past !
President ;Of the! Bond ;Club of !
| Great
—
Memoran¬
Buckley Brothers,; 1529
Walnut Street, Philadelphia 2, Pa.
'vi Also! available is ^?;memorah#
dum on Reda Pump Co,;
i
'
1 Midland
Utilities arid Midland
Realization—detailed
write for
circular
study-
M-3—Fred
W.
Fairman & Co., 208 South La Salle
Street, Chicago 4, 111.
;
arte
C. M. Glass Is With
CrallendM in
(Special
j
to The
I
c—McLaughlin, Baird & Reuss,
Wall Street, New York 5, N. Y.
Corp.—Circulars—
Chicago
Financial
Chboniclk)
/ "
CHICAGO, ; ILL.—Chester
M.
Glass, Jr., has become associated
With Cruttenden & Co., 209 South
La Salle
Street,
;
members of the
New York and
Chicago Stock Ex¬
Mr. Glass has recently
changes.
been .serving in the U. S. Navy.
Prior thereto he was with Bahk-
a'merica
Pacific! Bonds—Out-
Missouri
cisco
Company in,San Fran¬
and;
trading
was
manager
department ! for
Hansen & Co.
!
''
of: the
Wulff,
f
New England Lime Company-
&
Railway
Short
ment
Equipment
resume
on
American
..
on*
Industries*
Kropp Forge
1 Also,
a
Lester KoEt Now With
Opportunities
available
a
report
Franklin
ysis
of
County
condition
and
post-war
prospects^rF. H." Koller
Co!
Broadway, New York 6
Inc., Ill
in: the
N.
Dearborn 1501
Study
Y.
Engineering Co.; Walt Dis¬
Productions; Foundation Com¬
pany; and Segal Lock & Hard¬
man7
ney
is
ware.
study of Baltimore and Ohio.
'
'
•
possibilities
—
'
on
Hoit,
f Parkersburg Rig and Reel Com¬
pany—Analysis—H. Hentz & Co.,
00% Beaver .Street!sNew ?!York • 4*
N. Y. ; Also available is an analy¬
sis of the Reading Company and a*
discussion of the Liquid Resources
of the Railroad Industry.
!
National
Public
Bank
Trust
&
Co.—Analysis^ for dealers only—
C. E. Unterberg & Co., 61 Broad¬
N. Y. '
^
'
only are anal¬
yses of National Radiator Co. and
Republic Pictures. :
; !
:
facial to; The Financial
Chbonicl*>
*
CHICAGO, !. ILL.—Lester 1 H;
become" associated with
Eastman, Dillon & Co., 135 South
Salle .Street.
• /
Holt
Mr,
:prmerly. with Riter.
;
was
Co;,
was v
Vice-President of .Duryea & Co, ?
tn4;vwas with Brown, Bennett ■&/,
lohnson.
In the past he did busi- .
less
as
an
individual
dealer
in
Chicago.
Charles Bartow With
Wm. E. Pollock Co.
Charles
Bartow
has
become
associated with the U. S. Govern- I
meht bond house of Wm. E., Pol- >
lock ;& Co.; 20 Pine Street, New ;
York City.
Mr. Bartow was for-
Lehigh
cular
—
Valley
Railroad—Cir¬
Baird
&
McLaughlin,
I SINCE 19081
•
.
.
——ii
r
,;„'!
</;.•;.
Irving B. Haass Has
Rejoined David J. Greene
j- David J. Greene, 30 > Broad
-
City, member
Exchange,
Irving B. Haass
*
.
^chenley- Distillers Corporation:
—Brochure of articles they havi
been running in the Chronicle-:
write to-? Mark Merit, in care o
Schenlcy
350
i
Fifth
Distillers
Corporation
Avenue, New York 1
Street,
New York
of the New York Stock
announces
has
been
-
that
released
service and is
from
active
renewing his
ciation with him
,
.
as
securities of .special
en
asso¬
analyst of I 1
interest, V »
;
Members
;
CoLl.
r
,
Stock
Exchange
Chicago
Board
of
CHICAGp so; SHORE
Trade
,
Midland Realization
Write For
203
SOUTH LA
CHICAGO
Telephone
4.
SO; BEND RR. Com.
U.
MFG. CORP. Coiiimon.
NORTHERN STATES POWER CO. 6 & 7 Pfds.
ST.
4068
York
<JO AX?
Byllesby and Company
Incorporated
!•
■"
135 So. La Sa.lle Street, Chicago 3
ILLINOIS
Randolph
s/
Also
H. M.
Telephone State 8711
New York
Philadelphia
'!
!
!
Teletype CG 273
Pittsburgh
Minneapolis
Inc.—Detailed
& Hardy, 11
Three ;Rejoin Staff of
John Nuveen & Co.
CHICAGO, ILL. r- Wilbur! G.
and Thomas R. Hawkins,
Sugar—Circular
—
J.
available
on
is
a
both Lieutenants in the Navy, and,
George A. McKeon, Captain in the
Army, have been released' from
active duty and are again asso¬
F.. ciated with John Nuveen & Co.,*
Reilly & Co., 40 Exchange Place,
New York 5, N. Y.
dum
SALLE
Direct Private Wire to New
finteiii
' GALVIN
—
Broadway, New York 4, N. Y.
M'3—
study of Midland 'Utilities,' '/
Products,
Hardy
,
circular
Midland Utilities
A
Sport
—We Maintain Active Markets ln-~
.
Chicago
Scranton Spring Brook Water
Co.—Analysis—Ira Haupt & Co.,
lli Broadway, New York 6, N. Y.
Inman
7
135 South La Salle Street
memoran¬
Gre^t American Indus¬
Dempsey Incorporates
CHICAGO, ILL.—Dempsey and
tries.
Company,
;
.
§erly
Co. an officer * of p. F; Childs ^
cfe
Teletype CG 257
American Forging and SocketCircular—De Young,
Larson &
!- v
.
.
V
..
i
Holt- has
,
way, New, York 6,
i Also for dealers
—Vilas & Hickey, 49 Wall Street,
New York 5, N. Y.
Also available
a
•
Panama Coca Cola—Circular
Coal—Anal¬
I Also detailed circulars on Fash¬
ion Park, Shatterproof Glass, Well-.
Alleghany Corporation
CHICAGO 4
Treat & Co., 40.
Wall Street, New York 5, N, Yv !v
or
J Farrel I - Birmingham ; Co.—Analysis—W. J. Banigan & Co., 50
^roadway, New York 4, N. Y.
Eastman, Dillon Go.
Engineering Works—
Circular—Amos
?ose & Troster, 74 Trinity Place,
New York 6,7 N. Y,:
.
/;
'
'v
^
■;W&
*
;BuhIi;Building,' Detroi*
^heller Manufacturing Corp.
New York 6, N. Y.
COM STOCK
<'
t
I Northern
interesting
Kendall Company—Descriptive
heavy industries and presenting
Lubetkin
&
comparative statistical dajfca on 30 circular—Seligirian,
leading companies in this field— Co., 41 Broad Street, New York 4
E. F. Hutton & Co., 61 Broadway, NeW:.York^:!c!;!#:^
Burgess
-'%
Inc. — Recent;
Mercier, » McDowell
&
Mich.
26.
special re¬
port on Magor Car Corporation,
manufacturer of freight cars, etc.
—Blair F. Claybaugh & Co., 72
Wall Street, New York 5, N. Y.
utilities-JIirsch
—
polphym
Stocks—
railroad- equip¬
situation and
Selected
Light
late memoranda
f Electromaster
Heavy TfidUStries—Study review¬
ing the outlook Jor five of the
Pyget Sound
are
-V
Corporation, 40 Ex¬
change Place* New York 5; N< Y*
pub¬
' 25
Broad Street, New York 4,: N. Y.
Fred. W. Fairman
^
—
ion Securities
Corporati
Salle St.
10
Alabama Mills, Inc.; Douglas Shoe;
and Purolator Products. ^
"
231 So. La
Co.,
Street, Chicago 4. 111.
Descriptive
circular --Dayton
New York Bank Stocks—-Com¬
Haigney & Co., 75 Federal Street,
parison and analysis of 19 New
Boston 10, Mass. /
i P
Dayton Mapeable* Iron ,£0.7^
York Bank Stocks as of Dec. 31,
1945—Laird, Bissell & Meeds, 120 :$tudy of oujtook an,^ speculative
possibilities
for appreciation "for ^:New:;England"!;Public! Service:
Broadway, New York" 5, N. Y.
this company—Ward & Co., 120
Go.—Analysis—Ira Haupt & Co..
Ill Broadway, New York
6, N. Y.
1945- Closing! Canadian
Bond Broadway, New York 5, N. Y. Also^
lic
.
&
Illinois."
Hicks & Price, 231 South La Salle
cial Conditions—Outlook for
!
Gas Utilities
; Consolidated
Review of Business and Finan¬
Coal
analysis—Faroll
'oo
Cleveland, Ohio
Central
{\
Dealers Ohip-
business
Merchants Distilling Corp.—re¬
side Cement, and Spokane Port¬
land
eport
Established
'
^
Central Steel & Wire* Com.
*Wboda!l Industries, Inc.,
99
Inc.,
of
National
the
—
1 Wall St.
Globe Steel Tubes
sugar
I Consolidated
Ceinent -. Corp
Class * A—Bulletins on recent-'Me*
Box 51-A, Cherokee
Station, Louisville, Ky.
Randolph 5686—CG 972
*Eurton-Pixie Corp., Com. :X
;
Wall
Street, New York 5, N. Y.
growth situation—Stern
on a
Co., 120 Broadway, New York 5*
vital in¬
industry
-and the
& Associates,
:
;
the
analyzing price movements which
applies the theory of probability
to
price; variances — descriptive,
booklet on request—Paul Dysart
7
Members Principal Stock Exchanges
Chicago Board of Trade
>
on
United : States
& Co..
Corp.
HICKS 6-PRICE
New York Office
oil speculation—
S. Lichtenstein & Co., 99
B.
| Carrier Corporation—Memoran¬
:
world—La mborn
Market
.
othe'r
and
data
formation
the
111.
analyzed as potential
First; California
Company, 300 Montgomery Street,
Wall
231 SO. LA SALLE
esting low-priced
inter¬
an
on
companies
Calif.
member
a
Association of
He iss
investments —:
Consolidated Gas
Utilities Corp. •
Request
if-:
Realization! Corpora^
Mar-Tex
Standard Silica Corp;
Ni Y.
on
!'
115 Broadway,
New York City.
Lamborn's Sugar Calendar—Sta¬
Circular
'If -i.
■;
cent
(jroodbody ic'Co.,
<t'
1946 business and investments—12
San Francisco 20,
The Chicago
;,Lipe Rolhvay Corporation—Cir¬
cular—Herrick, Waddell & Co., 55
Liberty Street,' New York 5, N. Y.
South La Salle
■;b
; TOLEDO,
O. — Oliver Goshia,
Groshia & Co., has been appointed
,
tion—Memorandum:
*!;!
larger supply of money upon
the
Michigan 4181
f
Service Co.—Circular
Street, Chicago 4, 111.,
of
Discussing
the effects of con¬
sumer demand, increased incomes,
cash reserves, tax reductions and
650$. Spring St
CO 99.
s
volume
company;
lative
purchase — First
Colony
Corporation, 70 Pine Street, New
York 5, N. Y,
f Also available; are; studies of
Bishop & Babcock, York Corru¬
gating, American- Insulator.
Investment Guide for January-
f
LOS ANGELES 14
ISSLaSalieSt
State 6502
'
-t-Adams & Co., 231 South La Salle
!"!'
DISTRIBUTION
CHICAGO 3
'"
past ten years; earnings and divi¬
dends
since
1936; capitalization
each
District Committee
,
"
[ American Stove Co.—Study ol
Street, New York 5/N. Y. '•
MARKET
SECONDARY
Rapids- -National
Grand Rapids 2;
interesting stock offering an in¬
vestment in the coming building
Volume — Bendix,
Luitweiier &
o., 52 Wall Street, New York 5,
i
UNDEI^lTERSgll
;
-
.Building,
| American
trading in certhin important stocks
—January issue, 160 pages, $10.00;
Annual service (6 issues), $50.00
—F.
W.
Stephens,
15 William
-:-j.
Wholesale Distributors
•
Grand
highs and lows, for, the
of
*
Middle West
,
viding statistics on virtually every
active stock listed on the New
York Stock and Curb Exchanges;
3
CASTER H. CORBREY & CO.
of Securities
.
,
Graphic Stocks—900 charts pro¬
monthly
Member, National
_
Bank
••
Tele. C|G 271
Tel. Randolph €960
parties the following literature:
Commodity Outlook — Forecast
for 1946—Bache & Co., 36 Wall
Street
120 South La Salle
the*firm§ mentioned will he pleased !»!;
to send interested
Stockyards Pfd.
NASD
on
common
'
Kropp Forge
Roi
Company — Study of
stock as a sound specu¬
Le
,
Central Elec. & Gas •"
Oliver Goshia
135.- South.
La- Salle
>
-
Victor
Equipment Company—, Street, is now doing business as a
Joseph E. Dempsey 1
Special memorandum — Walston, corporation.
Hoffman
gomery
Calif.
&
Mont¬ is President, Jack R. Dempsey'
San Francisco 4, Vice-President and Armand :L.
'
.'!-;••!' 1 Primeau. Treasurer.
Goodwin. 265
Street,
■
.Volume 163
Cincinnati
-
Exchange Has New Type Membership
Announces
a
ing Rights
on
.
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4456
New Class of Membership Which Permits
,.v;/''V;;; (Continued from page.243)
■
\
On Jan. 11, it was announced that in the interest of the public;
the Cincinnati Stock Exchange had created a new type membership
•;
So
as
to
make
Grady Proprietorship
Dealers Citation of SEC Argued
Full Trad-h
Floor With Full Commissions; but Without Interest
Assets of Exchange.
-
in
251
Grady has retired from partner-^
;
under the Securities Act of
ship in the investment business
have chosen to do
Carl
1934, the Commission might
nothing with respect to them and they
would have become effective within 30
days from the
date a copy was filed with the Commission.
V
available to all investors, through their respective
j
WOOSTER, OHIO—Roy Li
brokers, the advantages of the agerold auction system of trading in
/'However, once the Commission chose to institute a
on the Cincinnati Stock Exchknge, the officials <j>f
!||
proceeding
by its own order and have a hearing with rethe Exchange :explained to/a group of 21;Cincinnati brokprs and"
spect to these by-laws, Its duty was to enter an order at
dealers, who are not members of$>
the termination of the
the Exchange, a new type of mem- may ,.be assessed up .to^ $100.00 ja
hearing.'' .
bership known as "limited mem¬ year before the now outstanding
Mr. Louis Loss,
arguing in behalf of the SEC; said that
berships." In an effort to be of memberships can be assessed. Two
the Circuit Court of Appeafi and not the District Court, had
greater service to the public and; of the five places on the Boarjd
in: a
spirit of cooperation. and of Trustees (the governing body jurisdiction of this controversy.
recognising the fact that all quali¬ of the Exchange) may be held by
i;-'
, Withdrawal Contemplated
fied persons in the securities busi¬ limited members and all limited
-
M.
ofj
Grady, Peoples Federal
Building, and the latter is
tinuing his business
as
con-j
indi-j
an
vidual dealer.
5
securities traded
:
to a profit on
they originate, the
Exchange has worked out a plan
to make Exchange memberships
available to all qualified applicants
entitled
are
ness
all
business
in
engaged
the
in
ness
busi¬
securities
the
area
of
influence of
Cincinnati! Stock
the
Exchange.
Months of study by Exchange of¬
ficials and a survey of the attitude
has resulted in this
ers
of
Exchange!adopted^
the
of
the members
Trustees,
new
permitting, in addition to
the present type of memberships
now outstanding, the issuance of
new
limited memberships.
The
membership is in the form of a
privilege to trade on the Exchange
and will be sold
for $1,000.00.
Present
memberships
have
a
rules
,
..,
t
y
a more
1
>
and when assessment is necessary,
ber of the same firm,
a
TRADING MARKETS
It. is also, contended < byf the: petitioners, that under the
terms of the Securities Act,i an appeal from- the determine
& Pac* Ry. Co.
only when an order has been entered.
The whole subject of orderly regulation is involved, as
well as that of rehearing before the Commission itself, and
appeal to the Circuit Court.
/'
'
',
/ '
/
,
*
'6% & 7% "Old" Pfd.
f
;
CRftomcw);
(Special
^CHICAGO/
" CHICAGOILL.-i Robert;
become
associate^
•with Bache: &? Co.* 135 ■ South La
Ganser
..
has
Salle Street,,; He was
previously
& Co. and Good-
with H. Hentz
'
fcody & Co.
'
*
<
(Special to The
-
Aldworth
Bros.
&
NSTA CORPORATE COMMITTEE:
#
ILL. — Richard
\
Chronicle)
Financial
•
Brown Shoe Preferred
ILL.:—Claude
has
an
become
Offered
by
Gofdman, Sachs
associated
&
with
Goldman, Sachs & Co. and Leh¬
Co.,
man
Brothers
on
Jan. 15 made a
Inc.,
.
Chronicle)
(Special to The Financial
CHICAGO,
ILL;—James
D.
Butter has rejoined Halsey, Stuart
Co.; Inc! 10 South sLaSalle
after completing service
"Street,
With the armed forces.
/
]
,
(Special to Thb: financial Chronicle)
;
CHICAGO, ILL.—Lore W. Aland
ford
Frank
O.
Elliott
(Special
1
have
to The
Chronicle)
Financial
George
Howard- F.
K,
(Special
to The
Financial
.
Chronicle)
! CHICAGO, ILL^Frank O. El¬
«&
Street, after serving with the U. S;
liott has rejoined Harris, Hail &
Co., ill W. Monroe Street, after
Army
serving in the Ui S. Navy.
We have prepared a revised bulletin
"Upon completion of the pres^ent financing, and after prepay¬
ment of the term loan, the cap¬
?
italization
the
company
value of $15 each.
Brown
Shoe
Co.,
Copies available
on
request.
INCORPORATED
-V
-
j
'
ferred stock and 1,000,000 author¬
ized shares of common stock, of
Common
♦Recent
medium-priced
women's,
men's and ^children's
shoes; both ' styled, and staple
SalesA for the fiscal year ended
Oct. 31, 1945 amounted to $56,-
458,000.
:
.'
members
of
the
circular
on
■
request
ADAMS & CO.
* 231
.
South La Sail. Str..t
,
Chicago U, Illinois
-
Teletype CG 361
Phone State 0101
,
FINANCIAL
;
'
ADVERTISING
I
New York and
Pittsburgh Stock Exchange.
,
Klehmet & Co.
A11
n
Plans
Opens New
Branch in San Francisco
}
FRANCISCO,
SAN
Klehmet
and
Co.
opening of a branch office at
1 Montgomery
Street under the
management of Richard O. Tufts,
Standard Silica Co.
Nekoosa-Edwardls Paper Co.
National .Tool Co.
Central
Northern Paper Mills Co.
Cons; Water Pwr. and Paper Co.
Wisconsin Power and Light Co.
Hamilton
Compo Shoe Mach. Co.
James Manufacturing Co.
n
Members Chicago
Teletype: CG 1200
PHONES^-Daly 5392
v?:Incorporated
'/' .■
131 Cedar Street New York
6,
-
;
N.Y.;
Telephone COrtlandt 7-5060
.
Boston Chicago Philadelphia San Francisco
Mactfadderi Publications
All Wisconsin Issues
;;
"
Froedtert Grain &. Malt. Co.
I
i
»
x-■
v
Gisholt Machine,
Mfg. Co.
Stock Exchange
MILWAUKEE
Chicago: State 0933
.
(2), WIS.
Teletype Ml 488
>
Guenther Law
^
OF
Koehring Co.
Paper Co., Com.
Br a riches
Prepared—Conference Invited
Albert Frank
the
announce
I ts
.^
CALIF.—
CONTINUOUS INTEREST IN:
225 EAST MASON ST.
CHICAGO 3, ILLINOIS
'
of
'
135 SOUTH LA SALLE STREET
Telephone: Dearborn 6161
1
makes
Inc.
DOYLE, O'CONNOR & CO.
?
Interstate Aircraft
& Engineering Corp.
and sells to retail distributors ah
extensive line
THE SECURITIES
MIDLAND UTILITIES Common
.
will
consist of the 40,000 shares of au¬
thorized
and
outstanding pre¬
r
on
of
MIDLAND REALIZATION Common
•
Common
.
Soules has
1
VE. & G. Brooke Iron Co.
are! out^
,
Ross, Thompson Securities, Co;
rejoined Link, Gorman
Co., Inc., 208 South La Salle
shares
-
standing!! Stockholders recently
authorized
a
split-up of each
share of common stock, without
par value; into two; shares of the
.
merly with G. J. Case & Co. and
—
which ;;492,000
CHICAGO, ILL.—W i 11 i a m J.
rejoined The Crammer bank loan maturing on April, 1,
Rejoins Moore; Leonard i
Company* First National Bank 1955, and the balance will, in the ^ PITTSBURGH,
PA;— Charles
Building, after serving in the U. S. first instance, be added to'its gen¬ McK. Lynch, Jr., has been re¬
Army.
eral funds. In view of the antici¬
leased. from. duty in ~thef;U. S.
pated demand for its products the Navy and has resumed his duties
(Special to The Financial Chronicle)
company: intends; to v apply ?por^- as partner in Moore, Leonard &
Trust ; Building,
CHICAGO, ILL.—Andrew C. tions of its general funds to the Lynch, Union
in the armed forces.
ILL.
>
.
Noel has
Stay art has become affiliated with opening of factories in the South,
Detirtef & Co.,
105 two of which are already under
South La Salle Street. He was for¬ construction.
CHICAGO,
Common'
•
000,000 of the net proceeds to the
prepayment of its 2% %: term
rej oined • Harris, Hall & Co., 111
West Monroe Street, after serving
(Special to The Financial Chronicle)
.
R. Hoe & Co., Inc.
:
:
present common stock of the par
10i5 public offering of 40,000 shares of
South La Salle Street, in the. sales $3.60 Cumulative Preferred Stock
department. He was previously of Brown V Shoe Company, In<?.
with, the First Securities Company The -• public: offering price wa>
6f Chicago^
$102 per share.
:
j
The company ^will; Appl5t::$3r
Emerich
Ames,
\
..,
>
CHICAGO, ILL;—Richard Bry¬
B.
Paul
.XL Davis & Co.* 10 South La Salle
Street.
In the past he was with
Merrill Lynch, Pierce, Fenner &
CHICAGO,
American Service Co.
Preferred, Class. A and Common
Chronicle)
to The Financial
cently been in the U. S. Army.
(Special to The Financial Chronicle)
Franz has joined the staff of
*
;: ,The following, two members havq been' appointed on the Cor-;
porate Committee by R. Victor Mosley, Stroud & Co., Inc., Phila¬
pas .rejoined Salomop
Hutzler, 231 South La
to The
-
;.
CHICAGO, ILL.—Gordon L.
Chronicle)j;
Teach has be.en added to the staff
CHICAGO, ILL —Frederick W.
of A.* C. Ailyn & Co., Inc.V ,100
Channer : has; rejoined' Channejr
West Monroe Street. He has re¬
Securities Company, 39 South La
(Special
Tele. CG 573
!.: • Active Trading Market*
Chronicle)
Financial
!v:
v;;
NSTANotes
-A* - (Special to T»8 Financial
^Salle Street; after serving; in. the
"armed forces. \ •
/ :/< w :
s
v!.;
Chicago 3* III.
Tel. STAte 4950
|
R. Underwood, Milton-R. Underwood & Co., Houston, Texas.; !;
(Special
:'•!
135 South La Salle Street
inf the delphia^ Ghairman;'which wiR^dmpretethiCGortimitee^
;
James Jacques/ Pallas Rupe & Son, Dallas, Texas; and-Milton
armed forces;-;'wMm
—.—
*
KITCHEN & CO.
Salle Street, after serving
*
'!!■:->;
.
Chicago Personnels
v
,
Chicago, Rode Island!
tion of the SEC lies
firm to another mem¬
~
|
principal exchanges
be; redeemable or salable,
but may be transferred from orfe
member of
i
i.
>'
px
Members New York Stock Exchange and other
value only so long astfye
member* remains in business and
will hot
: l
•;. ;r
.
Branches in 33 Cities
.
a
liquidating value of approximately
$6,500.00.
Limited memberships
carry
dues of $100.00 per year,
Chicago
.
*
.
,..
will
membership
'
COMMODITIES
•
231 So. La Salle St.
Issue Vital to Securities Industry
question of whether or not the Commission has a
duty to enter an order under the circumstances raised by the
dealers' petition is one of large importance to the industry.
deceased member.
limited
The
have
a
I
SECURITIES
The
membership of the Exchang^,
gives the regular members the
right to redeem their membership
when going out of business, at
70% of the theii liquidating value.
This right is also given • to the
estate of
'
_
and reg¬
'
,
They believe the effects of this would be to get
speedy final determination. 1
^
,,
feature, adopted by the
A hew
On the recommendation of the
Board
United States.
spects, the limited member will be
just as much a member of the Ex¬
change as the present regular
member*
He will he'permitted
to trade on the Exchange,': make
full commissions, and will be gov¬
,
;
M5KINNON
When interviewed, thb attorneys for the petitioning
even
though the question is a novel one,
they were considering withdrawing the present petition and
proceeding directly to the Circuit Court of Appeals of the
dealers said that
membership, but m other re¬
ent
THOMSON&!
:; ,l
trustees
r
• ;
!::
The assets of the Exchange will
remain in the hands of the pres¬
.
erned by the same rules
ulations.
1
(
type
new
membership.
vote when
to be .elected.
are
.
of non-member brokers and deal¬
of
members may
FOUNDED 1913
J
I0LLEY, DAYTON & GERNON
Member—Chicago Stock Exchange
105 So. Lo Salle
CG 262
;
I
5
St., Chicago 3, 111.
L Central 0780
;,
Offices in Wisconsin
Eau Claire
-
Fond du Lac
Madison
«
-
'
La Crosse
Wausau
:
THF. COMMPRriAi tA PTNAMrrAT, CHRONICLE
252
Eugene Garner Named
^Michigan Brevities
last
73,450
an
out-of-town
Thefire insurance group showed no
division,
;
National
pany which will add its net share of the proceeds to its general
working capital. The .Kuhlman Electric Co., whose business office is
located in Bay City, Mich.;; is engaged in the manufacture of elec¬ to Federal tax refunds payable to
the comany as.
distribution trans¬
tric power and
" * '(
melting furnaces.
The
>
„
of
dividend
facilities and depreciation
adjustments applicable to the op¬
of
prior- years.
Sales
were $3,107,239 but the increased
proportion of sales of tubing car¬
rying lower unit selling prices
the ab-paid a cash
cents per share
5
16, 1946.
:;
reduced
vision
:
Michigan Seamless Tube
of South Lyon, Mich:, re¬
ports that the net income for the
12 months ending Oct;; 31,1945
The
-
increased
164 "
.
$115,808, which- represents
earnings of $2.92 per common
share, as compared with $2.84 per
common
share in the preceding
was
Federal
and
banks
$255,752
securities
was
with
panded
Wm.C.Roney&Co.
the
Members New York Stock Exchange
812 BUHL BUILDING
>
'■
6700
•
63$ Penobscot Building
DETROIT 26, MICH.
Teletype
;!
Randolph 5625
in
DE 206
Electromaster, Inc.
Sheller
was
Manufacturing Corp.
'
„
*'
.
.*•*
•
C.
•
\
' "r'~
H.
Dutton*
renegotiation
the
War
no
by
Prospectus
on
be;
share commission will
a
to the underwriters, Otis &
California
First
Co.,
and
Septem-I
Customers of
will receive
«
\
.
of
of
a
decree
signed Dec. 31 by Circuit Judge
Archie D. McDonald. The decree
opposed by James H. Lee,
Detroit », Assistant;
Corporation
Counsel, who argued that the re¬
fund should be at least $3,750,000 greater.
;
■
■
The; Kaiseri-Frgzer Corp., seek¬
,
.
,
Coast and to .Canada, filed Jan.. 4
with the Securities and Exchange
Commission
a"
registration state¬
ment for public, offering of 1,800,additional shares ;of
,
common
$25,000,000
offering
pany
is
facilities needed for its peacetime
operations,
Ernest
R„
Breech,
President, announced recently in
a
letter to stockholders
was the $1,055,000 Stam¬
ford bonds due 1946 through 1965,
bearing
1%
a
second list
said
contract
anticipated $25,000,the
newest of
can¬
cellations
and the problems and
delays of reconversion had mate¬
rially changed the corporation's
profit picture. Directors in No¬
vember
reduced
the
dividend
rate from 75
cents to
50 cents
a
.
v"
fc
#
ing of an additional 95,900 shares
of the
common
stock of the
Corp. making
499,180 shares listed.
Of
the
a
amount, 79,848
Burry
total of
are
Norwalk
of
member
1% bonds due 1949
inclusive. • Interest rates
m.
Charles
American Forging
& Socket Co.
1
%-n?\'
,tu
|-
on
1
leYoung, Larson & Tornga
Staff
MICH.—Charles A.
Co., 639 Penobscot
Building, members of the Detroit
Stock
Exchange,
have ..added
Richard M. Patterson, Lloyd H.
Ratz, Joseph H. Hatfield and Fred
GRAND RAPIDS, MICH.
Phone 98261
and
Patterson
tors
was
before
Truck
service; Mr, Ratz
banker.
Lieutenant, Mr.
with
General
Mo¬
entering
the
was
formerly a
-"
-
found
year
towns
free
>j!
«
*
The City of New Britain award¬
ed u$100,000 / sewer fund
bonds
'
tors.
Jan.
1,
1946,
serially
$10,000 a year Jan. 1, 1948 ta 1957
inclusive, to Lee Higginson Corp.,
due
100.077
for an .80% interest
The next highest bid was
100.07 for an .80% coupon, sub¬
rate.
mitted
by White, Weld & Co.
>;<
*
1945,
*
*
.
■
•;
for
revenue
November,!
$13,406,307 — a b o u t
that of November,
Operating expenses of $9,was
6.9%
under
1P44.
768,120 were 3% less than those
of November, 1944.
Gross
'
for
revenue
months; ended
>
Nov.
-
*
of Darien
Co.
termination
of
■
$159,467,114,
which
the
were
expenses
of
$929,944 less than the
Dependable
"-
Accurate
York
31, 1945, the affairs of the Hart¬
ford-Empire Co, are now urideri
the first 11 months of 1945
:
the Ui
S.
$11,106,554, after fixed charges ;!
but excluding rents under re¬
jected leases.
This
compares
with $12,415,519 for the like pe¬
Navy, has returned to
Francis
W.
Cole, Chairman of
the Board of Travelers insurance
Co.; has been elected
a
director of
the firm of Merrill Lynch, Pierce,
the Chase National Bank of New!
Fenner and
York.
as a
Beane, Buhl Building,
registered representative. Mr.
Crane is
a
son
of Howard Crane,
has
become
of
one
Britain's, top
the
Mr,; Cole is
United
•
a
Aircraft
director of
Corp.,
Co.,
Colt's, Patent
Manufacturing Co.
-
Fire
and
*
Lynch and the old E. A. Pierce
j his directorships in companies in
firm for
more
than 10 years.
the Travelers group,
Fifty-fifth Year of Dealing in
Primary
Markets—Statistical Information
Hartford and
Moreland & Co.
Member
1051
Detroit
Stock
Penobscot
Building
DETROIT 26, MICH.
THetype
Battle Creek
.!
Bay City
DE
Connecticut Securities
r:
Exchange
white, noble & co.
Members
Detroit
GRAND
76
Lansinf
Stock
New York:
Exchange
RAPIDS
Chas.W. Scranton
Hartford 7-3191
Co.
&
New Haven
,
BOwling Green 9-2211
2
-
New London
MICH. TRUST BLDG.
Waterbury
Danbury
'
Muskegon
Phone 94336
Teletype GR 184
Bell
System
Teletype: HF 365
So¬
ciety for Savings in addition to
CONNECTICUT SECURITIES
:
Arms'
the
and has been with Merrill
men,
and Boston Stock
Primary Markets in
Inquiries Invited
the
Hartford, National... Bank & Trust
Exchanges
Exchange
.
was
riod in 1944.
Lyman
Lieutenant in
a
Net income for
Associate Members New York Curb
Request
same
period in 1944.
.
:
$113,618,420
Government receivership on Dec.
-
is
increased $537,968, freight reyenue declined $8,212,667.
Oper¬
Tifft Brothers
Members New
1945,
approximately!^,7%] less than
at
Lyman Crane Rejoins
Merrill Lynch Firm
11
the
30,
the corresponding period a year
ago.
While passenger revenue
ating
the
Secre¬
year ago.
Gross
.
.40% plus $1.50 premium.
With
Proctor is also
income of $473,372 for November
a
totaled
Trust
direc¬
$
Darien,
Conn.,
recently
sold
$150,000 notes dated Jan. 9, 1946,
due May 15, 1946, to the Home
&
Mr.
a
board* of
the
of
tary and a director of the North¬
western Telegraph Co.
,
dated
Hartford, has been elected
income of $1,366,412 after fixed;
charges but excluding rents under
rejected leases, compared with net
of
bonded debt.
prominent Detroit architect who
A. Braman to" their staff.
A former Naval
the
Crane, formerly
DETROIT,
Parcells
Request.
,
to
of
DETROIT, MICH.
JParcells & Co.
Adds Four
end
Vice-Presi¬
a
National Bank
First
the
The New York, New Haven. &
Hartford Railroad reported net
re¬
served for conversion of preferred
shares.
'
of
1973
Bank
*
*
The Detroit Stock Exchange has
announced authorization for list¬
dent
to
Connecticut
,
Joseph R;Prbctor!
and the
the $750,000 issue
coupon;
was
director of the New
a
Haven Bank, NBA.
of
at
Breech
share.
since 1937:
been elected
largest
The
approximately
anticipated
by
chase'1 arid
i Mr.
This is the
Jan. 15.
first dividend paid by the com¬
r
financing
in
the
*
*
*
during: 1945
Niles-Bement
Pond Co. recently
aggregated $2,610,000, which com¬
Richard
W.
Banfield
pared with $1,602,000 the preced¬ elected
ing year, and with $21,035,000 in Treasurer to succeed Everett L.
1940—the largest total during any Morgan.
Hugh MacArthur, President of
one of the last 10 years.
Of the eight issues sold, the the Connecticut \Coke Co., has
O
of
Biscuit
Out of the
will be
Aviation
forp. to pur¬
modernize plants arid
Bendix
dividend of 25 cents
a
share payable Feb. 1 to stock
of record
Manufacturing.
*
31
their 1944 and 1945
terms
latest
the
issue of 1,700,-
:Js
petrqit Edison po.
this year refunds
on
publicly offered the heavily
Expenditure
repayment for 1945
Michigan Markets
Elec. Welding
*
90^
Control
Darling
National
declared
a
and
announced later.
regulations
Profits
is expected to be necessary;
GR 84
,
common,
1946 to 1950,
required
Industrial Brownhoist
l. A.
probably
market
over-subscribed
'r\t
»'
at
prices, currently with an over-the-counter
quotation of $14.75 and $15,75.
ber
TRADING MARKETS
.
will
stock
Allen & Co., which last
No repayment
-was
Circular
-l%
plans
Los
a
The
Co.,
Stock Exchange
Buhl BIdg., Detroit 26
Tele. DE 507
Lnion
Screw
>
Insurance
Co., formerly Rossia Insurance;;
of
Mercier, McDowell
_
manufacturers'
Detroit, open a plant
Angeles area, and
subsidiary in Canada. •5
the
go
furnished on request
Cadillac 5752
Standard
Northeastern
State of Connecticut
near
offered
"
further need
no
000. proceeds, the
& Dolphyn
"
Government
000
'
Detroit
in
ter¬
stock.
Members
'
'■
1933, has been promoted
launch
agreement
1944,
ing to. double its working capital
prior to expanding .to the West
Reports
'
to expand its Willow Run opera¬
tions
of
was
^
'
000 shares at $10 each. The date
bills, under
Michigan Markets
resources
credit
into
$16,450,000
Telephone
'
•
■
Municipal
-
anticipated.
Act and
1
Established 1919
Members Detroit Stock Exchange
:V
r-1'
.
of profits, earned in 1944 to the
was
Charles A. Parcelk & Co.
-
Garner
Fafnil*
Bearing, Hart & Cooley, North
& Judd, Russell Manufacturing,
ranged from a 1.10% coupon on
$350,000 Norwalk bonds due 1946
to 1955, down to a .50% coupon
for
$75,000 Milford bonds due
under
'
V.
-
,
Detroit, who has been
bank since its organiza¬
automobile
this temporary arrangement
the
V:i.■■
in
*
&,Allen, insurance.
The
Hardware,
to Vice-Presidents
A
minated since
>lPtone
:%
current
company.
The
bank
of
Cherry
the
entered
DETROIT 26, MICH.
DE 167
tion
'
,
above, and ..earnings retained for
general corporate purposes ex¬
Teletype
!
of
with the
quid assets, along:.with the,Fed¬
eral
tax
refunds
referred
to
UNLISTEDS
;
Eugene T.
Bank
the
procedures
Contact Set¬
tlement
Act.
The
postwar re¬
funds of excess profits taxes and
United States excess profits tax
refund bonds which became li¬
MICHIGAN
American
on
••
by: the
Russell
to stockholders of Acme Wirei
that claims
against others arising from ter¬
minated war contracts are being
processed at a satisfactory rate in
accordance
son, RobinsOn & Cole, attorneys;
and Thomas W. Russell of Allen,
reductions in disbursements
t
Manager of the Hart¬
Jr., senior partner Of Robin¬
son,
.
states
established
and General
category!. ford-Empire Co.; Lucius F. Robin¬
the "industrial
was a decline in payments
of approximately $637,000 due
1945.
Snyder
Byrne, President of the
Trust; Co.;
Roger M. Eldred, Vice-President
there
to
B.
Hartford-Connecticut
Light & Power - Co.
special by the Hartford
Co.
;
a
In
Govern¬
ment
John
the
Electric Light
$259,163
was
increased dividend paid by
and
the
in
Mr.
attributable
Any
~
$720,445 from $582,the ; year.
Cash on
in
Hartford banks paid out $12,500 more than last year.
change, while the life insurance
group increased $640,000 due to extra payments made by Aetna- Life
Insurance, Connecticut General Insurance, and Travelers Irisutance.
Resumption of the extra riivi-^
dcnd by Hartford Steam Boiler, the management of its board • of
plus an increase in the regular directors.
The board now con¬
payment of the Aetna Casualty & sists of six members, the Presi¬
Surety Co. added $135,000 to the dent j F. Goodwin Smith, arid five
casualty group.f:<'[In the public newly elected directors: James H.
utility field, the net increase was Brewster, Jr., Vice-President of
some $263,000, which represented
the
Aetna
Life
Insurance
Co.;
an
pro¬
for
taxes
and: .the * investment
Oct. 31,
states Joseph J. • ; Snyder,
Chairman. However, in 1945, $20,529 of net income, equal to 51
to
during
hand
year,
Call Vs On
The
profits.
gross
for
disbursements-
Connecticut
fiscal year was equal to 58% of
taxable income. Working capital
Co.,
cents per share, was
ac¬
emer¬
erations
after
company,
of
gency
!
of two years,
sence
Jan.
,
net result of
a
celerated "amortization
formers and the manufacture and
distribution
of j electric > metal
J
During 1945, major Connecticut companies paid out in dividend^
aggregate of $14,203,163—an increase of some $413,000 over 1944's
DETROIT, > MICH.—Eugene % T.
G arner# lending officer- with the
V'
& Co., of; Grand Rapids, Mich., at $3.25 per
Of the shares offered 22,300 were for the account of the com¬
by White Noble
share.
Connecticut Brevities
V.-P. of Detroit Bank 1
shares of common stock, par value $2 per
share of the Kuhlman Electric Co.,,was publicly offered on Dec. 21
issue of
An
Thursday, January ;17y 1946;
--Members N. Y. Stock
Exchange
•"
Volume .1j63 ;; Number 4456
THE'COMMERCIAL & FINANCIAL CHRONICLE
Melady i Co.; NYSE
Real Estate Securities
Formation' 'rotm the
.
A
partners
William
J. '-Melady (board
ber) and Arthur V. Crofton,
ber
•
■■■■■■•
refunded, with
and
that
institution-
there,
are
now
loans
pending
-
some
-refunding
same
nature.^:^.,^-'!^^^^^(X
• programs
of - the
The effect On security dealers is
:
Refunding;
the
means '
call of; securities;.with jthat/rauch
less merchandise: for - dealerst to
trade;#;.-*?
The effect
the security
on
is a. littler more
stance,
v
owner
ijWOiyoct;- .'For. ;inr
hear,that.consideration
we
is
being given < to>a* possible re¬
funding of the first mortgage
I bonds of 61 Broadway. Should this
be
correct, we would not be too
enthused about such a
procedure.
The issue was
reorganized the lat¬
ter
part
were
of
cut
holders
I
of the bond
ni
■
a
J Mr. Shipman;;served. 11
lim¬
years
mb
.was
.a
senior
t
of; the x investigation
of principal in reorganization, v •
staff of theCommission'sv New
l; While: it: is true that besides York
Regional Office/1He was the
this : payment, "> the > bondholder oldest^
employe^ in' that office fn
would still own; the property, the
point ofservice;:Mr, Shipman
writer does not feel he would be
began his career; as an office boy
as
well off with
an
ahead of his stbek
basis
e
e r-;
as
now
charges. In
case,
and\managed
a
period of 10 years
-joining the' SEC/,
i John Melady is well known in
ffrms
to
reason ;
at
securities have
time
any
half
possibility
and
the
bond¬
This would not be
of
the | grain
States
no
fear
with
so
an
•
at par
-
;;
:>% ft h
>
1
-lb V./
>
" -V
*
'-v
-w?
--
From
believe
York
serve
Hotel St.
George, 4's
ST; VY'V, *', VT-* »* V"', 7
165
5
iV;, f1
a
bonds
of
of the
situation
a
believe will not be
Broadway, 4'i's
which
137,000,; arriving at
a
•
the
value
on
$2,-
$9,400,000 which
|m e n d t h a t ;
part of the
3y which the '•
Government:
las
in
;
P'
*
*
was
and may, m the very near future,
recommend corrective legislation,
fit of
credit,
Pieter
of the
Yo
'a-
' Vi?*-5
-
*
*'
"f,i V-■■■'■'ri.
...
Memberi Now York Curb
.....
40 EXCHANGE FL.,N.Y.'
Belt
,
•-
...
Incorporate^
"
,
*
"
-
BOUGHT
-
-
•
This
QUOTED
.
)
39
HAnover 2-8970
Broadway <"
York 6, N. Y. V
: ' Teletype NY 1-1203
REAL
at
the year-end
he
added;
assign such basic? industries to the!
(Continued
on page
274)*
S.
Hotel Lexington Units
Savoy Plaza 3s 1956 W. S.
Hotel Lexington Common
40'Wall St. 5s
Hotel St. George 4s 1950
165 Broadway 4V^s 1958
870 7th Ave. 4^s 1957 W. s.
1966 W. S.
Liquid Assets
/held the unprecedented total
vi
in
Incorporated
■
*
New York
ure
is
|
J?, N, Y.
(in billions of dollars)
Federal Securities^*:
i Series E Savings Bonds——
: Other savings bonds
: Other securities
U
•s
Total
-
Commercial banks
.
Mutual savings banks
>' Postal Savings and
savings
i
'
Alms
La
■;
.
Income
Hotel
Salle
5/60
"B"
'
'
4/47
Madison
Hotel
Chicago
:
Transportation Bldg., Chgo.
(V. T. C. and Land Trust
bil-
V/.„.
Leamington, Inc. Com.
Savoy-Plaza 3-6/56
So. La
Salle St.,
i Tel. Central 4424
-
;
lion may be divided into three ap¬
proximately equal segments. The
largest single segment—$64 bil¬
lion—was in Federal securities,
consisted
of
Ituss Bldg. Units
California Consumers Com.
Sierra Pacific Pwr, Com.
HELP WANTED
*
Puget Sound P. & L. Com.
Alabama Mills Com.
and Checking
//-Accounts-^/;;':;'://;
Series
26
Checking accounts
37
Total
!.'.>;•[(
i
In
.
V
'
181
"
addition
(Continued
*;•
•
Tele. CG 660
J. S. STRAUSS & CO.
155 Montgomery Street,' San Francisco 4, Calif. '
Teletype SF 61 & 62
V EXbrook 1285
f
.
v
to
these
on page
-
OTHER CLASSIFIED ADS
1
record:
273)
POSITIONS WANTED
/ ;
SEE INSIDE BACK COVER
63,;
/ 'V-';
Grand Total.
,
for
-w
—
v.,;
:
;
MM
Currency
Units)
Chicago 3, 111.
I
i10-;
54:
C —Currency
California Water Service Com.
165 Broadway Bldg. 4^/58
15.
.
.Total
Wesley Lindow
accounts accounted
the remaining $63 billion.
Central Arizona L. & P. Com.
FIRST LA SALLE CO.
11
x ;
29;
He
checking
California Consumers 3-5/55
64
_
Trading Markets & Continuing Interests in the Following:
Broadway Barclay 2/56
-
21J
and loan associations
FOR
Chicago Stadium
12
;
/
Hotel Sherman
; '
•/,
31!
————
three
$181
,,
.
———
triple
Savings /Bonds. Various types
savings accounts amounted to
$54 billion,
and currency
and
Teletype NY 1-588
Individuals
Dec. 31, 1945
B—-Savings Accounts-—
of
/
;.w!Assets hy
New
E
\
SECURITIES
We Have Firm
of
'
—
City,
stated that
this
:
!;
11
n g
half of which
-
"5/57 W. S.
^
) Estimated Ownership of Liquid J
As¬
-
years ago.
BArclay 7-2360
alternative,"
: j Dr: / Lindow
.presented tablet)
detailihff the figures, as follows::: ]
Hotel
Roosevelt Hotel Common
150 Broadway
since V-E
be action by the United!
States Government,, through Con-!
gress, to arrest such a socialization!
trend by deeming it expedient to,
<£-i-
Sav¬
that- of
Tel.
"One
for
N,; Y» Majestic 4s 1956 W,
ESTATE
same man¬
has been done,
"might
Con¬
Roosevelt Hotel -5s 1964
—
as
Day, in most European countries^
of
pointed ; out
that this fig¬
'*
V~SPECIALISTS IN
,
at
Waldorf
Amott, Baker & Co.
j
ner
and
Beacon Hotel 4s 1958 W. S.
Mayflower Hotel Corp. Stock
industries in much the
a
director of re-:
Broadway Barclay 2s 1956
Gov. Clinton 2s 1952 W. S.
opportunity;
tion of the Money Savings Were Genuine Long-Term Savings Not
Constituting Inflationary Pressure, Even When Remaining Unin¬
ings
.-HAnover 2-2100
f-
TRADING MARKETS IN
.
an
Three-Year Tripling, According to Wesley
Lindow. .Treasury Official Estimates Liquid Assets.Held by Other
Non-Banlc.Investors at $296 Billion.
Holds That a Large Propor¬
Represents
January 9, he
M ember sXeiv York Security DealersAssn.
Hew
for
rates
Individuals Hold $ 181 Billion of
York
L. J. GOLOWATER & COl
:
tax
Revenue Act late last year, recog¬
nized that the excess-profits cred-
toria
'; Complete .Statistical Information
,
income
taxation, told the gathering of
Syracuse tax consultants that Con¬
gress,
when enacting the 1945
Wartime
• •
•
SOLD
;
enterprise by those!
anxious to arouse public clamqr
for
nationalizing key American;
City, and vice-chairman of the
Society's committee on Federal
ference
«>
Security Dealers Association
41-Broad Street, JNew York 4
.
.
to restrict free
Janis, Bruell & Evans, New York
Safeguardi
CERTIFICATES
■'V
sets
fore the
TITLE COMPANY
could be seized as
Speaking be¬
:..^v
Seligman, Lubetkin & Co.
:
Evans
'he Treasury
Departm e n t.
Teletype NY 1-953
York
Guy
subject of Mr. Evans' talk
"The Revehue Act of; 1945,"
search
-M-
pigby 4-4950;
'Members ftew
Peter
The
statistics
SincetW9\
Exchange
New/
Bar, at
Syracuse on Jan. 15. He spoke at
special taxation meeting of the
Syracuse chapter of the New York
State Society of Certified Public
was
'
particularly warned
that if "tax coasting" occurs on a
widespread scale in any branch of
the
basic : American
industries,
such as coal, steel, food, clothing,
chemicals and medicals, housing,
transportation and distribution, "if
$181 billion in liquid assets, according to Wesley Lindow, assistant
Real Estate Securities
V
'
Mtmbirs New York Stock Exchange
k
1946."
year
i j Mr j Evans
Individuals
*
SHASKAN & CO.
of the taxable
vested in Federal Securities.
'{MM
.:-v
r
provision,.will, be
made retroactive to the beginning
member
a
he
any
rate; income tax
by
Guy
C.P.A,
Evans,
quite obvious,"
legislation which
has' for its purpose the elimination of prospective abuse of. this corpo¬
"
was
■
sounded
be
addedy "that
-
profits
excess
and
: Vlf must
carry¬
back of unused
offeree
in
fW&'rt
permitted;/
SPECIALISTS
/'/ v'V'/
\]'r
Congress is studying., the problem,,
and
the
possible, abuse which
might arise under this provision,
tb retain for. ;
1946 the bene-;\;
Tl":
V;/;
"shock-ab¬
as a
corporations^,
of $14,000,000.)
excess
industry, but decided to
sorber "during reconversion. The
speaker then added: ■''However,
Revenue Act
legal: for trust funds, in 1930
year
provision might, be subject to
retain it for 1946
"
Beacon Hotel, 4's
/„\v
it
abuse by
value,of only
a
"Savoy Plaza 3-6's, '56
*■'
^>-
,
a
V
equal share; i« s100%
/
'
w;hich may
pared to the original bond issue
ap
an
special
lfegislation
ing
$4,938,120; for the property com¬
we
appear reasonable:
Bonds carry
stock with them giving the bOnd-
hplders
price, of
places
to this the institution loan of
,
(Park Central Hotel)
market
(37%)
the bond issue of $2,801,120; add
we
the
of
Intrinsically,
Ownership of the property.
institution loan of $2],137,000.
an
permanent
the bonds
situation.
870-7th Ave. Ws
a
in; the "Fi¬
Bond issue is $7,576,000 subject to
New:
Majestic Corporation de¬
;
investigation. Bent laws
property,
•'''
:
A warning that Congress, to prevent possible "coasting", this year
by industrial corporations which are entitled to tax refunds,.is study-.
the calendar year 1946.
Mr. Evans, who is a partner of
have curtailed the income of the
r ' '*
of the Excess Profits Tax Law.
Melady & Co. was
~-
[Current
leverage standpoint,
}
~
-
I
•
which
;-r
the
Be Abuse in the Use of the "Carryback" and "Refund" Provisions
ri
bonds
Primary Markets in:
mem¬
]
Accountants.
Formation of
previously reported
institution loan
■ -
;
nancial Chronicle" of Jan. 3,
which of course must be reduced
SECURITIES
held
for 26 years.
.
able to do with
export
William J.
bership in the Produce Exchange
operations the
discount at', which: they: have beeii
retiring bonds
has
permitted
them to reduce the mortgage to a
greater extent than they would be
REAL ESTATE
in the
Mr. Crofton has
and
stitution loan.
sinking fund
t]be/; United
Canada
import divisions.
Melady has been a member of
the Stock. Exchange for 15 years
in¬
an
and
and
the
foreclosure.
any
over
before
of bad times the
bonds
He or¬
brokerage
he- would be, ganized
that the company is not
faced with any fixed bond
owners •' of the
In
w{ith J. P.- Morgan;&; Co.
so
the
given stock • repre¬
equal share in approx-
institution loan'
with the bond: issue left intact. / "
The bond, issue is on an
income
and
in
an
,,
mem¬
York -Produce
Commission, A and '
because -of reduction
they have been: receiving tenders
in the past at m
price of 80. The
*;
New
with the Securities and Exchange
company has been retiring bonds
at a discount of:20% inasmuch as
r,
*
Ejxchange. ^ John Melady is
imately 98% of the ownership, of ited- partner:' *
1944
were
senting
of- the
■—
the. property; A refunding of" this
issue will only mean the payment
of about 50% of the
original cost
mem¬
-
,
obvious.;
.
r-»—
of
Frederic C; Shipman,
are
Tax Refunds
on
Guy Evans, Accountant and Attorney, Warns That Unless
i Congress Makes Changes in the Revenue Act of 1945, There Will
The general
has been announced".
pavings Banks, Insurance Companies and other institutions with
large surplus funds to invest have, decided that the
complexion of
real estate .investments has
improved'to the extent that mortgages
estate'are now desirable:to them. ^ •
•
:
w
The result
Avsuu.ufls
has been
uccn that*several<§>——
uiai beveidl-y,:
*•*■■■ -■
>r ■?1■?/—r-rrreal estate bond issues have been
firm
--
Coasting"^
"1 Peter
Melady & Co., with membership
hi the New York Stock Exchange,,
situation has arisen-in the real estate bond
field: that is
important both to investors and dealers• insecurities
new
v.-,
Sees
Members, Is Formed
253
I;
All in
Thursday, January 17, 1946
CHRONICLE
THE COMMERCIAL & FINANCIAL
254
all, close to $1.5 billion of
railroad bonds
for Railroad Bonds
refunded last
were
While most of the refunds
ings involved some reduction in
the
outstanding amount of the
bonds the aggregate cut in debt
year;
in
important considerations in the improved specinvestment attitude towards rail securities has-been
One of the most
ulative
and
reduction in debt and fixed charges in recent
years.
It has long been recognized that fundamentally, and purely
from an operating standpoint, the railroad industry has had one
of the best records, even in depression years, of any of our major
industries. As a group the Class ^
I carriers have never operated at a through practically all of the in¬
the much publicized
deficit—in the poorest
•
necessity for
absolute
The
re¬
burden
of fbfed
charges was fully recognized by
railroad management long before
ducing
the
dustry.
depression
income available for
charges after taxes topped
$500 million. The heavy burden
of
fixed
charges has been the
npmp?i? of
nf the
thf> indust.rv.:
'
nemesis
industry,
this
a
working
debt
Those
position to do so were
aggressively to retire
boom came along.
war
roads in
before
even
emerged
we
from the depression
As the
war
retirement
of the 1930s.
boom progressed debt
spread
programs
Even
a
number of
reor¬
ganization railroads utilized their
excess
earnings to retire senior
1938,
year,
fixed
claims
reduce claims for back
or
interest.
The
credits
poorer
in
the solvent group were helped by
the opportunity to purchase large
of
amounts
outstanding bonds at
discounts without any tax penal¬
ties,
•;
.
Last
ofher
^
low
year
-
w.e
phase
as
interest
encountered
an-
improved credit,
rates
the
and
huge
of funds seeking invest¬
ment hiade feasible the refund¬
amount
■
ing of high
some
coupon
of the poorer
bonds of
even
situated roads.
these
transactions
that
was
reduced
the
interest
costs
Than Adequate to Cover
gressive reduction in \debtv and
charges is assured.
^:
liens
Central
Illinois
and
major program
within a short time.
Also, roads
emerging from reorganization will
presumably continue ' to refund
announce
a
their first mortgage bonds.
These.
'vv
York, Chicago & St. Louis,™
Chicago & North- Western,
Here .Marquette
Baltimore & Ohio.
Corporation
•
i
i
,
v
;
' '•
\
,1
...
L_--
55.5 ft
New
Concerning the first statement, note the com-
45.2
Atlantic
Cons. "A" 5s, 1927
'
Nashville.....
Coast
....I...
Atchison, Topeka & Santa Fe__—_^_______..___—
Kansas City Southern...,
Delaware,
Lackawanna &
...
....
.
*—r *—
.
"
lii'.i
*n-
Pennsylvania
F
T'
of
interest
bonds
for
some
leased line stocks,
Ernst&Co.
'
Ills
7.9
•'
2.22
2.88
•
1.04
,
§Ellmluating-inter-company items.
-
.
„
•
extent to which indvidual roads
Were able to reduce their charges.
Some-such as Southern-Railway
were : handicapped
by the exist¬
ence/of large amounts of high
coupon non-callable bonds. Others
•
considered
.
'
*
•
JfASX-Vi
Railroad Bonds and Stocks
Broadway, New York5, N. Y.
it
concentrate?
advisable to
building up urn-
more-
on
pregnable finances.^; Still others
were_
forced- by circumstances to
cash
their
utilize
111,
at
full principal
the
Members
RAILROAD
61
SECURITIES
Selected
Situations
at
all
tNew York 6
Bell
the
'
Teletype—NY: 1-310
high
are
list
the
on
in
cut
percentage
>
be no gener¬
of the best
can
some
as
in
fixed
charges and some are well down
towards the bottom.
Some of the
poorest credits are also near the
top and some close to the bottom
of the list.
j
tynmi ft
-
credits
Times
St. Louis
V
San Francisco
-
Telephone BOwling Green 9-6400
Teletype NY 1-1063
/
)f.\'
the
Railway Company
charges from actual
/
'
r*
p?i"'
•/
j,
.•
'
-
'
!?""! 0'i:
%
'
•»
-
Complete arbitrage proposition
'*
•
«
;
on
$ rj
vwi'!
A,, V 'Vf ^
AA A
request
are
arranged frv descending order
Tennessee
-
Members New York Stock Exchange
r
Telephone REctor 2-7340
•
.
average
the
g
of
basis
v
eral
/
reported
taxes
income
earnings
for
the
five
1937-1941.
Railway
Securities Association :
/ PHILADELPHIA,
PA.—II. Clif¬
th^ariiniual dinner-meeting of the
15
Jan.
held
Association
.
,
:
V, McKenzie of Paine, Web-»
& Curtis, the 1945
I
liam
i
elected
officers
Other
soli,I Stroud
&
Co.;
Francis Goodhue, 3rd,
lodk;
Secretary,
and
Calvin BulHarry C.
Rippard, Buckley Brothers.
For
membership on the Board of Gov¬
to serve three years:
ernors
and Theodore M.,
Hughes;; StandaH ^ /Poor's! Corp.
For membership on the Board of
Governors to serve for two years:
Harold F. Carter, Hornblower &
nia! Company;
Weeks.
Rice Opens Fifth Office in
Fla.; Second in Palm Beach
/Daniel
office
second
63
Wall Street, New York 5
•
established
nounced.
The
South
246
BOwling Green 9-8120
Boston
Tele. NY 1-724
Philadelphia
Hartford
of Securities Dealers, Inc.
street
HAnover 2-9072
,
n.
y. c.
5
Tele. NY 1-1293
TEL.
partner,
an-*
other office is at
County
Road
Woods, - Jr., resident man-:
in. charge./The Breakers
Hotel office will be supervised by
Howard Barber, the firm's repre¬
ager,
sentative.
Florida
Other
are
offices
Rice
in / Miami/
~
Philadelphia
NEW YORK 5
.
with
Louis
Circular Upon Request;-, " ' '
HANOVER 2-1355
in
firm',
Rice,,
J.
Joseph
Members New York Stock Exchange
52 wall
the
Beach',
in
Palm
that resort this year by the
ONE WALL STREET
co.
Member of National Association
Company
office
an
Hotelin
Breakers
the
and
Rice
F.
have /opened
Mclaughlin, baird & reuss
1. h. rothchild &
Harry
Rippard, Francis Goodhue, 3rd,
G. Ellwood Williams, Pennsylva¬
C.
UNITED PUBLIC UTILITIES. Com.
Adams & Peck
were:
Inger-fTreasurer,
Vice-President, William B.
Beach and Ft. Lauderdale,
\'
Wil-f
ber; Jackson
president.
General and Consolidated 4s-4V->*-5s, 2003
SERVICE, Com.
the
at
University Club. He succeeds
Lehigh Valley Railroad
CO.
Common Stock
PUBLIC
of
available for charges., before Fed¬
years
UNITED
coverage
present indicated fixed charges on
,
Central
BATES MANUFACTURING
We
percentage reduction.
show
also
SUTRO BROS. & CO.
120 BROADWAY, NEW YORK 5, N. Y.
The roads
at the 1945- year-erid.
of the
!
1935 accruals
t<f indicated annual fixed charges
(when issued)
'Av %*£
reducing
in
major/ roads
the
New York 4, N.Y.
tabulation we
record of a number of
above,
the
In.
show
i
"
INCORPORATED
25 BrOad Street
Broadway
There
alization
York Stock Exchange
Telephone-~-DIgby 4-4933
CUARAMTEED RAILROAD STOCKS-BONDS
-
New
opportunity to buy in discount
bonds.
PFLUGFELDER, BAMPTON & RUST
only be met
amount and
advantage of
thus could not take
the
retire obli¬
to
gations which could
Specialists in
.
purchase programs by most roads. ton Neff of Schmidt, Poole & Co,,
J As is common in every phase of was elected President of the Phil¬
railroad- operations and iinances
adelphia Securities Association at
ihere was a wide variation in the
"
t Largely through "voluntary jplan putting
2 Largely through" exchanging contingent
and
.233 So. LaSalle St., Chicago 4,
dempUon preiruumsi
is obvious that present prices and
thin markets will militate against
continuation of aggressive bond
A
'
other
leading Security and Commodity Exchs.
120
,?•
t
,
11.8
•
emerging from reorganization,
interest on a contingent, basis,
portion
8l;26
819.7
/
.......u."
"
2.00
§20.2
Pacific
*Since
*
'■
26.9.
.
Centrai.w.x.i^£U^iiiiJuL.i._i
jMorepver,:it Neff Heads Philadelphia
j
,
6,83
">2:35't
: 2.63 '
•
27.9
Railway
Lehigh Valley
Exchange
1.53
;
New York
»
.
.
1.85
,
♦27.1
Southern
1.46
.2.26
:1,^6
28.3
.'» —■
Erie-
L'nion
MEMBERS
i>
31.2
-30.6
28.7
—
1
(Continued on page 276)
„
3.31
30.4
,
-
Stock
2.18
131.3
Western..
Chesapeake & Ohio^..-.
Chicago, Burlington & Quincy
York
Hotel Traylor, Allenis a member of the Stock Exchange
McLaughlin,:Baird & Reuss, New York City.
,
delivered by Mr. Reuss at the
*An address
firm of
4.48-:
*35.5
.
;
'
out of operating expenses.
town, Pa;, Jan. 7, -1946. Mr. Reuss
"
2.53
•
:
,
3.16,
35.9
—i
—
Northern-, Pacific
New
6.25
„
-
Wabash
Southern. Pacific
Common & Preferred
'
1'
:
payroll has not expanded correspondingly;
compensatingly^hote the small fluctuation in the
influence of wages
'
•
total
Reuse
Wendell
W.
,
vs3.52
38.8
Illinois -/Central:
Arden Farms
.
i.o5:,
:■
40.8
,.,
,
;
2.21.
10,9
Line
4.16
2.29
■
...
fir!;-.
42.3
-
&
Texas & Pacific..
.
•ry*)h
42.0
Louisville
Chicago Railways
1
•12.5
Reading '
"
1.88
43.2
_J_
l
.
t43.3
_r
Virginian.
.1?)
'
-3.35'
,
mileage and equipment
operated and resultant fewer employees, in the
face of substantially higher miles carried; note,
how, despite the higher average annual wage, the
bined influence qf lesser
-v:-3.0T «■* ^
*50.0
-L_~-
,
Delaware & Hudson..
1
*
.53.1
-
Mlssouri-Kansas-Texas
Common & Preferred
;
Northern
Great
Republic Pictures
Fed. Income Taxes
\
amount estimated to be more than adequate.
Coverage Present
Fixed Charges Bef.
Federal
after
1937-1941 Average
Since 1935
Charge coverage (before and
Income tax deductions)
in an
Fixed
show
will
'
Fixed Charges
;
|and 1942 levels; and
»
Railroads during the Postwar Period
The
3.
last year when heavy ex¬
profits taxes sharply reduced
'
>
between the 1941
nessed
Cut in
Concludes
ing—in this discussion of the Outlook for Railroad Bonds—and they
•
v
j -;',y
^may be tabulated in the following brief fashion: •>) 'ft
;;. 1, Railroad Management HAS been able to
'
operate with such increased efficiency, that the ;
steady rise in wage costs largely has been offset;
HENCE, PROVING THAT TOO LOOSE THINK- v
1NG BY THE PUBLIC, TO THE EFFECT THAT
RAILROADS ARE "WAR-BRIDES," IS ENTIRE¬
LY ERRONEOUS;
'
•
2. The Railroad industry during the Postwar
Period will handle a volume of business ranging
•
potentialities,^ LoweVe^>c°bld"f
hardly reach, the proportions' wit-'
cess
Taxes and Fixed Charges.
i for Further Increases in Rail Dividends.
There are three points that I wish to concentrate upon this even¬
likely that the major
of debt reduction (except
through * reorganization- proceed¬
ings now pending) and refunding
has been
passed.Baltimore &
Ohio is expected to undertake a
comprehensive refunding of its
seems
senior
.
That Wf Are Facing Continued Railroad Prosperity With Prospects
j
part
may
; '
Uphold His Contention (1) That
Railroad Management Has Been Able to Operate With Such In-
[creased Efficiency That They Have Been Enabled to Offset the |
! Steady Rise in Wage Costs;
(2) That the Railroad Industry in
| j Postwar Will Handle a Volume of Business About the 1941-1942};
i Level; and (3) That Railroads Will Therefore Show Earnings More
were
from
$60,688,000 to $44,467,000.
Also, virtually all of the
new
refunding
issues
provide
sinking funds so that further pro¬
It
"
Mr. Reuss Presents Data Which
under
was
The important factor
$75,000,000.
W. WENDELL REUSS*
By
.
'j
Telephone
:
—
TELETYPE NY 1-2155
Lombard
9008
in
Miami!
.
.
■
'
Volume 163
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4456
Railroad Earnings and
Rail Securities
/
By CHARLES SHIPMAN* / ; /
;
Stone & Webster and
White Weld
.
Railroad. Stocks as Excep- /;
tionally Favorable, Expecting Class I Roads to Gross Approximately
Mr. Shipman Regards' the Outlook for
•
VM.
Severe Break in
a
Group Sell
iliSlffl/i: Market Necessary?
Tennessee Gas Com.
An
Transportation Editor of Standard & Poor's Corp.
Is
255
underwriting
ROGER W. BABSON
group headed
-/-v-
by Stone & Webster and Blodget
Mr. Babson, Though
Stating That Heretofore Bull Markets Have
Incorporated and White, Weld. &
in Peaks, Holds That the Present Market, After LevelCo. .and/ including Blyth- & Co.,
Offf May Remain Stable for Some Time. Bases Belief on Easy
Inc.,/ The' First Boston Corpora-: X
.
^.Culminated
Money;Situation, Work of SEC in Preventing Undue Speculation
/:§ $7*4 Billion in 1946./ Believes ThatlTherells a Chance, of Net In-:
tionv Kidder, Peabody & Co.,1
Lehman Brothers, Mellon, Securi-i
and a Safe CIO Attitude.
1
come. Exceeding the War Year 1944, the Exact" Showing Depending
ties Corporation, Union Securities
On the Amount of} the; Prospective Wage Boost,: With Possible Off-/g
///
Is another severe break in stock market prices necessary? PerCorporation, W. C. Langley & Co.,;
Need the market go up to a peak,
sets in the Form of Increased Freight Rates. < He Holds That in Any V Paine, Webber, Jackson & Curtis, haps someday, but not just now.
as
in
Central Republic Company (Incor¬
1929,♦
:
•/:
Event the/Earnings Will Be J Satisfactory,; and That Substantial
and :
then bombs.
porated) and Bosworth,. Chanute,'
Why people do not give
Expansion Is Indicated for 1947.
•come
down
more
thought to the future is
Loughridge & Co.
;
,
:
•
,
Mli
The
torn has
war has now been over for nearly five months and the bot-i
not yet dropped out of the market for railroad: securities.;
railroad
A
like
m>-
-/v'/1'//
?
-
Burling-
ton is A.able to
what -about
the/ future?/ In; our
business: the;; future: is'. something
than/par for
2%'s" maturOur
-
index of spec- /
bonds
with
always have to talk about.
rehabilitated.
The question
is,
Will it^stay rehabilitated?; Under
.
illative f rail
fhe
* circumstances, • what; about
prices for' railroad bonds' and
:
ratings
/"B"
•
NO
one needs to be told* now that the
credit of..the • railroads/ has "been
we
ing >25: years /
h'ence;
But
ting since the middle of 1942;
;
shows average
J
.
ones
rail
average
1937
are
all .familiar with
charts
showing
howl mucl^
Such charts and tables
high.
Charles
esting.
Shipman
They
.All this after
very much worthwhile.
don't
war.
answer
our
comparison with industrials. That
particularly if
isn't surprising if we consider the
holder
*MrS Shipittari's /address/before
inter¬
But they
question.
It is
decidedly comfortable to note that
Southern Pacific has net; Working
capital now of over $100 million}
It must be admitted that since
V-J Day the performance of rail
stocks has* been pretty pale by
v
the Society, of Security Analysts}
Jan. 4, 1946.
are
illuminating and
are
'the
'
tables
cheaper railroad stocks are now
than in 1941, on the basis of in¬
vestment in property per -share
plus net Working capital per share}
broke through
its
We
and
Dow-;;
stock
of
we
Happen to be
Central
Pacific
a
bonds
j niaturing in: 1949. From the standpoint of the stockholder
1
(Continued
or
on page,
bond-
278)
The Administration of
been
the
stock
at
$12
per
Co..
heavily oversubscribed.
/'j
1940j
; The company,: Organized in
constructed
and
is operating
1,265-mile
(mostly 24-inch)
pressure natural gas
Veterans' Housing Priorities
■r*>
Mother
each
market
could
be /
level
a!
transmission!
/or
Corpus Christi,. Texas, into West!
Virginia,'where deliveries of hat-"
Ural gas /are/made: Under
I6ng-j
term; qohtraSts to the /company'g
two principal
customers} United
of
Fuel
Gas
Co.
Gas Co.
and
instead
Proceeds from the sale of 238,
000 shares of common stock
will;
the
to
go
and will be'
company
applied, toward
the
four
compressor
additional
purchase
of
sta¬
such
opment Worthy of the Resources and
an
^The sale. of the.
ress.
iect Jan. 15 is
prog-i
remaining!
company and represents a part of
the holdings of such stockholders:
;//w
or k a
plan
vide
to
a
b 1
amounted to
revenues
and met income,
was
on
a
pro
forma
$2,954,980. '
quarters
at
1012
Buhl: Building.
Thq firm has beeri
member of
a
the Detroit Stock Exchange since
Argentina}
Dorfman
stocks
hot
be
cheap
could
Reuther
railroads,-
utilities,
coal
the stocks of
large industrials
being "nationalized"
true. 1 But,
and
money
the
may
be¬
the
of
could severly
continue
to
} But
be
a
-
the
is
It
very
States
United
jam with Russia; or some; other
country which could bring about
World
could
III.
War
be
Then
there
collapse. in city real
a
stock
years,
market
as
December, 1942.
guaranteeing
anything ex¬
cepting that conditions today are
different / from
ever
before.
Either
centage of
'going
to
atomic
be
can
moving into a more
else a large per¬
we are
stable world
or
our
present
should
coast.
be
a
cities
But wth this
scramble
for;
self-sustaining small .farms away
from"tthe .evil
world
be
wiped out.
energy
facing us,
no
:
there
I
halfway.ground;
'But "who
created
lieve
that
atomic
effects- of atoniid
energy-
may
j
needs.
If so, this discovery
.
World
and
seem
property.;
very
the entire: cost ?
II—both
War
,
alone/
:in live9 ;
Market breaks ?
:
^
small matters to
nificent possibilities..
'
-
'
.
be
placed
in
the
hands
of
/ builders
willing
to
construct
% dwelling units costing $10,000 and
/ less or renting at $80. a month and
less with veterans being given the
first
opportunity to
such housing.
j
i
:
BANKERS
^
ply of critical building materials
will
SA
INVESTMENT
•;. •/
(Continued
on
buy
or
rent
276) ;v//:
the
population,
Dr:
actually behind
the military Fascist Peron
regime,
,
are
but
by demagogic methods, play¬
ing
certain
another
and
ises,. the
-
page
in
groups
Dorfman said,
make
■*
4*.\>.;
against
through false
government
an
ir'.'
interests
artificial
one
prom¬
rather
of
than
the
real
eradication
-
Nazism, he added.
"The "war will not be
the /last
germs
of
to
ner
show
of
said in conclusion.
of
the
until
over
Nazism
definitely destroyed in
is: able
..i*.*..<■
Members New York Stock Exchange
:
are
every cor¬
earth,": Dr.* Dorfmhn
"4
..
..
.<
Other Leading
■
and
Exchanges
UNDERWRITERS AND DISTRIBUTORS OF
| INVESTMENT SECURITIES
'MII
BROKERS OF BONDS,
Private Wires
•
me:
compared with these truly mag-»
,;
stability. These groups
apparently. prefer good business
j
bring about the spiritual awaken-/?
ing which this old world so much
•
economic
j
'
'
atomic
this
.
None; of the several
is
With
energy? * We know that the an-.
-swer is, "God created it"; in
fact, j
it may even : be a manifestatioh
j
/of God.
If so, It Has unlimited $
possibilities; for good—for making j
a
healthier, happier and more ?
prosperous^^ world,^ Hence, I/be- /
of
sea
j
I
not
will be well, ^brth
the
a
a
Mind you, I am '
cially those in
near
I
I
be
may
high level for
it stabilized at
a
estate and many industries, espe¬
vulnerable
the
above
possible, with
/money //situation,
SEC and the CIO,
the
at
•
,
'
a
>
low level from December, 1938 to
sus¬
that
into
get
present
by
the
few
But may
of the
possible
very
aided
stabilized
friend
may
is
the,
that
at
This i$ not saying: that .a severe
break in the stock market cannot
come.
it
'
Stability
sive power.
j
Destruction?
or
eliminating
scares,
a
sell
decline,
Stabilization
whereby
process
abnormal/profits/anci;the
Warning that plans for a new world war .are being laid in Ar4
gentina through the joint efforts of Nazi,; Fascist,ahd Failarigist groups
both inside and outside the country, Dr. Adolfo
•ume
of new
Dorfman; industrial
home
con¬
engineer and economist from Argentina, urged joint intervention as
the
struction
un¬
only hope for: eradicating the threat^tn world security. - - • /;
'y
der
way
ih
X Dr.- Dorfman, now economic adviser, to the Office of Inter-Amej-V
ican
Affairs, who spoke Thursday,^
critical 1946.
Under the1 disguise pi
I think it is Jan. 10, at the weekly "Round strength.
Tables on Latin America," held at so-called a proper func4
'/anti-imperialism''. the
tion of the the New School for Social Re¬ regime is trying to reach a degree
John B. Blandford, Jr.
Federal pOV- search, declared that "the new of Nazi self-sufficiency, calling on
e.rnment, irt economic policy" put forward by the \ most reactionary forces in
view of the housing emergency, to the Peron government is merely n e i g-h b o r in
g
Countries, and
use its resources,
"variation
in cooperation a
on"; an old Nazi throughout" the continent.
This
: with
It is a policy, 'he said, policy which has the backing also
industry, to channel the nee* theme."
essary scarce materials into the which relies upon the drawbacks,
of reactionary elements in. big
Construction ; of houses for veU shortages and mistakes made by
capital. in' leading countries in¬
erans at fair prices that will still
democracy and employing well- cluding (Great Britain and the
produce
reasonable
profits
for known Nazi techniques it seeks to United States is a direct threat to
/builders.:;
capitalize on economic unrest and efforts being made by leading in¬
" T"
i
i Ult is
contemplated that under build up a strong military agres- ternational agencies to build up
the system about half of the sup¬
in j
no
>
f
as
buyers for these j
stocks,
prices
could / crumble i
quickly; and the entire market
Securi¬
consist
be
/ the largest
possible
vol-
~
are
that: the
other
now
would
small; investor by his prevention'
there
1
Economist .Charges Peron Government With" Pursuing Variations
On an Old Nazi Theme, and Vitally. Threatening international
private enter"prise to get
of
Market Breaks Are Possible
,
Warns Adolpho
speedy
in'
ties /and Exchange/ Commission
is 'doing for small investors, my
of
Quarters
New World War Being Planned in
stimulus.; to
always
cause
the* rules inf his favor;
$14,234,278
DETROIT} MICH.—The staff of
Mercier, McDowell & Dolphyn
have just completed settling
ip
their new enlarged arid: remodeled
Era of Housing Devel¬
e
d
e
their highs for some time.
Most of the business leaders are
giving effect to this fi¬
nancing the company's capitaliza¬ sore at Walter Reuther and the
tion will consist of
CIO
crowd in his attempt to-mix
$49,525,000 of
funded; debt,' 75,000 shares of 5% up wages 'with profits.
I grant,
cumulative
preferred /stock and this is an entirely new departure.
1,750,000- shares of common stock The typical' capitalist doesn't /like
For the 12 mpnths (endect Npv,. 30,
any thing mefcrwnless: it/ changes
li*—.u
pro4
t
After
In New
Aspirations of This Country.
simpl ef
must
574,100 shares; is for the account; bull "market
of
certain
stockholders
of
the leveling
off
.
"a
n a
peaks. Due to this fact, my friends
here/ in Wall Street thihk ' this
Mercier, McDowell Firm
I believe the systenr of priorities assistance for moderate-cost
ef-4
i
Wall, Street friends may be mis¬
taken.
The top of the present
in
and
,.
ni
tion of negotiations
now
Socialism.
England
and ': Europe
will
be.
liquidated
first.
Then
there
vCUl-
being built and;jiow owned
by the Reconstruction Finance
Corporation upon the consumma¬
housing to which veterans of World War II will be given preference!
;and whic h<® ■—lai" " ■ ■ in• -"*•
■ •" ?
XIgoes!into
have
excellent work- that
tions
are
markets
taining of purchasing power?
Federal Housing Official Describes thevProvisions' of the Veterans?
Housing, Priorities and Expresses/ Confidence That if the Cities,
States, Industry and Labor Cooperate With the Federal Goverh./ ment, the; Purpose of the Priorities; Will Not Only Be Accomplished
but the Foundations Also Will Bel Laid for
Babsori
or
and. oil stocks, and
Heretofore
Roger W.
break
Socialistic
Banks,
Too Bad
1
likely reason
would be ^
more
cloud is constantly moving west¬
ward, investors will begin to sell.
:
Reuther Not
Hope Natural
'
for
some
people in this country
going
.
"peak." /
bull
have
finally, convinced that Europe is'
pethaps
a
a
market
a
When
'months
years
I
fear of Communism
plateau
>
Earth.
of my grandchildren.
Perhaps
for
a
extending
over
pipe line extending /from/ ; the
Strattori-Agua Dulce field near!
basis;
B«BLANFORd/jK,
By JOHN
:
I
beyond
me.
Surely, the only
truly safe "life insurance".is good
'
high
Administrator, National Housing Agency
,
;
share:
|t94a^^he?/^ompanyfs//dp^
'
;
crash?
a
The offering was reported to havei
&. Tranmission
.
yield of about
4.10%.
Early /
in December
the
with
Certainly not.
It is possible
the
"top" of
Gas
nessee
common
that the rails had been set¬
pace
better
get
yesterday (Jan.;
16) offered 812,000 shares of
Ten-j
STOCKS, COMMODITIES
Home Office: Atlanta
•
/
Phone LD-l 59
& FINANCIAL CHRONICLE
THE COMMERCIAL
256
Thursday, January 17, .1946
Paterson Elected Chairman Hibernia National Gardner & McGovern
Bank and Insurance Stocks
;
f - This Week
♦
-7TV:]:]-: Bank in New Orleans
—
J,
Hecht Retires and Six Other Officers Are Moved
E. A. VAN DEUSEN
By
Insurance Stocks
/.";.
Fire insurance stocks, as measured
by Standard & Poor's index,
appreciated 16.1% between Dec. 30, 1944 and Dec.^31, 1945.
This
compares with a net appreciation of only 1.4% during the year 1944.
There was wide variation between individual stocks, however,
in both years.
Based on the record of 30 representative stocks, the
1945 range was between a high of 47.8% for Merchants and Manu¬
facturers (a low priced stock), and a low of 1.6% for Springfield
Fire & Marine.
During 1944, the thirty stocks showed an average
decline of 1.1%, compared with the Index gain of 1.4%.
Fourteen
stocks gained in price, two showed no change and fourteen showed
declines.
The performance of each of the thirty stocks for 1944 and
1945 is shown in the accompanying table.
,
.
-
Up
J.
Arthur
Warner
New
&
120 ;
Co.,
York
City,': an¬
Following the annual meeting of shareholders Jan. 9, A. P.
Imahorn, President of the Hibernia National Bank in New Orleans,
nounced that William H, Gardner
announced the election of A. B. Paterson as a Director and Chairman
has
Paterson, who held the position of Chairman of
the Executive Committee of the Hibernia National Bank; succeeds
Rudolf S. Hecht who retired from the bank on the same date/ Mr,
Imahorn alsoV
":'y""&$*•■?■
in
Mr.
the Board.
of
Broadway,
has
also
with
associated
become
the firm in the New. York trading
the
Mr. Imahorn said, "The Board was
department.
Di¬
of
Mar
happy to promote these offi¬
very
had
to
positions of greater re¬
J.; sponsibility from its own ranks.
promoted
from
de¬
motions of the six junior officers,
rectors
M.
them
service
need
that
Board
institutional
partment; rWilliamf J. McGovern
'
a n n ou
associated with
become
their
cers
rone
Four of them have been employed
Assist¬
by the Bank since .it was organ¬
ized and all merit the advance¬
ant Vice Pres¬
Gleisberg Resumes Duties 7
OMAHA,
NEB.
J.
Harold
—
Gleisberg has returned to his du¬
ties
of Green-
Vice-President
as
(
ident
1-1
CHANGE
IN: MARKET
PRICES:
Aetna
Insurance
American
Insurance
Baltimore
American
Bankers
Boston
&
_
2.7
.+
_
4.9
—
Insurance
Great
American
Fire
Hanover
__
__
...
Co.
•
Merchants
<fe
+
5.5
,
105%
i '■
89%
Liberty
13.4
8%
47.8
Now
York Fire
1.2
—
i
4.8
——-'/.J ;;;+22.9
"~r 4.1
Springfield F. & M.
•i-
4.5
+
3.5
Fire—-—^
yS
——i
Average of 30
31
be
13 y«
16%
,
97
9.0
34%
41
18.4
73%
7.8
37
6.1
of
1.6
the
60
17.1
ySi-'-Ajy sy.f', ';•*•"[
+
16.1%
that
the
Hampshire, North River, Security
stocks:
preciated
Baltimore American, City
New
York, Franklin, Home,
Liberty and New Bruns¬
wick.
With the exception of City
of New York, their performance
has been definitely below average
in each year.
5
National
.
The
following 13 stocks did bet¬
of the group
1944 and 1945:
Agricul¬
tural, American Insurance, Boston
Insurance, City of New York,
Continental, Fidelity-Phenix, Fire
Association, Glens Falls, Great
American, Hanover, Hartford, Ins.
ter than the average
both
of N. A. and U. S. Fire.
stocks already
6
,
•
.
„
addition to the Home Fleet
In
stocks
group
cited, the following
the
under
performed
I'in both
average
years:
Aetna, Bankers & Shippers, New
Springfield F. & M.
-
Merchants & Manufacturers ap¬
far
than any
other stock in the group in 1945;
on the other hand, it declined far
more than any other stock in 1944.
greater
National Fire and Phoenix per¬
formed
better
than
average
in
1944, but definitely below aver¬
age in 1945.
New York Fire and
Providence
Washington, contrari¬
wise, performed below average
in 1944, but well above average
in
1945.
corded above.
However, a num¬
ber of stocks have, rather con¬
sistently, been above-average per¬
formers in recent years, such as
Continental,:} Fidelity - P h e n i x,
Hartford Fire, Insurance Co. of
N.
^
A.
Generally
market
-■
.
to
tends
.
speaking,
follow
....
on
Request
New York
Stork
National Union
Insurance Co.
A.
Administra¬
*
Chairman,
Section
Board;
Park
Audubon
the
Louisiana
Southern
Committee
York
Economic
for
Orleans Chapter of the
<
Red Cross.
of
virtually
listed-on
stock
York Stock and
the
every
New
Curb
In
•
i
the
pro-
1944.
commenting
upon
a
show
that there
an
Bought—Sold—Quoted
>
term" holders, this
-
J.
Mr.
ment.
O'Leary
O'Leary
recently
was
Members New York Stock
1
WALL
Oibbs, Manager Trading Department)
ST.] i;
was
a
Curb
^
member of the New
Exchange.
■
York
individuals,
partnerships aud corpora-
,
of
Deposits
; States
—9,216,793.95
Government
.
.
4,781,549.27
;
.
Deposits of banking institu*
tions
533,907.30
-
—————-
Other deposits (certified and
officers* checks, etc.)——'
v 1,153,339.73
; v.; ■;
& total ;
: DEPOSITS $39,457,990.52
——'
Other, liabilities.—L
•
including
subordinated
obligations shown below)
.
"
222,637.29
.
(not
TOTAL LIABILITIES
$39,680,633.81
CAPITAL ACCOUNT
.
$1,000,000.00
Capitalf
750,000.00
COUNT
'4
.'5r"
^,'v•
$2,410,937.55
A—
——
i-'v
'S
\ 4
TOTAL LIABILITIES AND
$42,091,571.36
total
with
stock
of
of
consists
value
capital
institution's
fThis
common
i:
•
pAPITAL ACCOUNT
•;
660,937.55
AC-
CAPITAL
TOTAL
par
$1,000,000.00.
M
.
,
MEMORANDA
.
Pledged
(and se-'
loaned)
(book
assets
curities
(
;
.
values):..
U.
Government
S.
obliga¬
tions/ direct and guaran¬
teed,
pledged
to- secure
deposits and other liabili-
•
$10,194,839.91
assets
pledged
to
se-.-]] '•'•] W'.:
deposits; and
other ;
(including notes
v
,,"
.
and bills rediscounted and ] ^ ^ :V'
;
securities
under
sold
re¬
2,217,323.75
purchase agreement)—_
Assets
Common Stock
*
^
4,703,868.70
.
United
.
'
cure
,
■
pledged to qualify for
of
fiduciary
or
exercise
-
/corporate powers,;and for
purposes
other
than
to
Bought
PRIMARY MARKETS IN
•
Sold
Quoted
•
;
%
secure
BANK and INSURANCE STOCKS
•
.
Zi
Secured
...
and
A bilities:
(EYE I
k
First California Company
I'll.
•
"
'
V
^
•
to
Post
Office Square
.
..
231
IVall Street
S. LaSalle Street
.
A.V-297
WHITEHALL 3-0782
AT
i
7535
NEW YORK,
BOSTON,
PORTLAND,
Teletype SF 431-432
Spring Street
LOS ANGELES 14
SAN FRANCISCO 20
.
:
Enterprise
Teletype I.A 533
■r.-'..Private Wires
Between San
7008
%
'
'
.•■*-.
,.
law
i'•
• '•
TOTAL
I,
the
under..,
but
WILLIAM
'
'
not
of assets
3,001,411.28
'' 'Y.:■
-
fn,ii..
i,
i
.
;■
«■
$15,358,355.18
—
D.
above-named
OFFICES
Francisco, Los Angeles, New York and
IN
PRINCIPAL
CALIFORNIA
of my
Chicago
PIKE,
Comptroller
of
Institution, hereby certify
knowledge and belief.
WILLIAM
Correct—Attest:
CITIES
C.
PROVIDENCE, Enterprise 7008
of
that the above ftatemeiit is true to the best
CHICAGO,
PHILADELPHIA, ST. LOUIS, LOS ANGELES
HARTFORD, Enterprise 0011
650 South
Montgomery Street
t'(r-105
-4875
WIRE SYSTEM CONNECTING:
300
'
FRANKLIN
HUBBARO 0650
PRIVATE
67
CHICAGO 4
preferred
provisions
secured by pledge
INCORPORATED
NEW YORK 5
BOSTON 9
pledged
/pursuant
Deposits
SECURITIES
INVESTMENT
\
,
_
to, re-- '
♦
,•
quirements of laW—L___ $12,356,943.90
/•;v
incorporated
.
812,563,529.66
—-
preferred lia-1
Deposits secured by
assets
^
liabilities-151,366.00
TOTAL
Prospectus available upon request
>
'
-
*
Deposits of States and politi>cal > subdivisions
•'
Corporation
''
and.,
—
$19,068,537.57
uals, ^partnerships,
corporations
—
s
Time deposits of
liabilities
Kaiser-Frazer
**
-
Demand deposits of individ¬
Other
(
■„
^ !"" r"'.Vr'o'-v A1J'.
LIABILITIES
'-H ties'
NEW YORK 5
Telephone Dlgby 4-2S25
f'Yy/V
>':!V- < '1
v.
Exchange
Y-and other leading exchanges
7-3300
ASSETS—$42,091,571.36
TOTAL
•
trading department ofC. A;
Alberts & Co. and prior thereto
AJl.Ki3W>G>,
:>
balances,
reserve
<
in the
is
7
collection—6,972,005.03
Banking
premises
owned,
-f
Hone; furniture and fix* '
tures and vaults—;——1.Q0
Other assets—57,708.11
has
become
associated with Dresser & Escher,
111 Broadway, New York City, as
manager of their trading depart¬
Edgar
important factor to take into
consideration.
Exchange
cluding
Dresser and Escher
has
; ;
140,601.80
of
•
fair degree of correlation
"long
X
.
-and cash items in process
;
Edgar O'Leary With
studies
v
2,834,252.07
Surplus fund
—
-'t
Undivided profits::—;
growth in stockholders^ equity; in
;!
-
-
16,917,054.53
Cash, balances with
other
banking institutions,
in¬
tions
Exchanges;
monthly highs and lows for the
merce
and, Industry;. National past ten years; earnings and divi¬
Council
Member
of
the : Boy dends since 1936; capitalization of
Scouts of; America. He is one of each company; volume of trading
the.
founders
of
International in certain important stocks—Jan¬
House and is a prominent advo¬ uary issue, 160 pages, $10.00; An¬
cate of a Tide Water Channel for nual service (6 issues), $50.00—
15
William
New Orleans;
He received the F, ; W,: ; Stephens,
Times Picayune Loving Cup for Street, New York 5, N. Y
.
.
the year
.ftnd
,
.
Se-;
financing
Graphic Stocks—900 charts pro¬
on
direct
_
States and; y
-political subdivisions—Other bonds, notes, and. de-
of
University, Washington
active
United
Community
and
War
Chest; "thel first President of the
Louisiana State Board of Com¬
most investors in insurance stocks
>"■ \
'
•
obligations,
guaranteed
Obligations . of
and
viding statistics
the first President of the
was
$15,169,928.82
■
;
;
.
(includ-
ing $271.81 overdrafts)-^United
States
Government
Square, New York 3, N. Y.
Development; Director of the New
He
method
Government
Review-
a call
Banks
Banking
;
bentures
price ; records—
C. J. Devine & Co., Inc., 48 Wall
Street, New York 5, N. Y.
Urban Mortgage Lending—New
New Orleans; member
the City of
—
operations
President of the Aviation Board of
of
United. States
curities
Institute;
Research
Southern
,
Bell Teletype—NY 1-1248-49
L.
of
business
of
close
York 4, New York,
on December 31,
New
Broadway,
Loans and discounts
analyzing price movements which
applies the theory of probability
to
price variances — descriptive
booklet on request—Paul DysBrt
& Associates, Box 51-A, Cherokee
Station, Louisville, Ky. ' - -, - '
University; member
of the Board of Trustees of the
are
,
BROADWAY, NEW YORK 5, N. Y.
Telephone: BArelay
leader
appreciation and
increase in equity or liquidating
value over investment periods of
a few years duration.
And since
:
Laird, Bissell & Meeds:
Members
Board
the
of
the
ASSETS
Co., 36 Wall Street, New
York 5, N. V.
;•>
Market Trends—A
the
relative
■
Circular,
Bache &
between market
Bank Stocks
•
Jr.,
;
It is not easy to explain many
of the market eccentricities re¬
19 New York
December 31.1945
industrial
50
at
American
1-4, 1942-1945—-New
University. School of Law,
Washington Square, New York 3;
N. Y.—$5.00.
Commodity
Outlook —J.
S.
tors of Tulane
been
k
of
Survey
.
published in accordance with
made
by
the Superintendent of
Vols.
Law,
Inc., member of the Board of Liq¬
uidation of the .City Debt; mem¬
fact
Comparison and Analysis
and
of
1945,
York
Louisiana; he is President of
New Orleans Public Service,
ber
observed
civic
inent
79
and
in
Annual
elected
newly
REPORT OP CONDITION OF
.
Company
Assistant
from
the
of
Mr. ; Paterson,
128
1.1%
—
"A, \
1 'j:
pursuant to the provisions of the
Law of the State of New York'.
Chairman of the Board, is a prom¬
34%
-
'
A
*;
.v"•
Underwriters Trust
.
126
51%
'
•
26.7
11.5
.
89
Home Fleet is represented in the
tabulation by the following six
of
Wallbillich
President; and; J. A. Bandi,
;o Assistant Cashier.
13.5
52%
♦Adjusted for rights.
will
J.
T.
President;
Foreign Trade
Department to Manager of that
Department; George J. Ruhlman
from Auditor to Assistant Vice
4.2
29%];••:'46% ,.:-
25%
;
& M.
•
+.'1.4
>
Washington
It
ment to Assistant Vice
-A•
■
.
Bookshelf
Trade Depart¬
Manager
3.4
7%
__
.
-a—
Hocurity Insurance
•
•
—11.8
r
North River
Phoenix
States
3.3
—
Hampshire
>
Foreign
the
Paterson
'
New Brunswick
New
;.
6.0
62
7%
—10.6
B.
A.
-f
16.4
21.9
serving in the army for sev-;
.
of
Manager
19.4
*109%
after
Man's
Assistant
19.8
]] 31%
5%
.
i
18.8;
32%
122%
28
Business
Officer
dent; Maurice
M.Bayon from
■'-A
7.1
,35%
Company, Farnam Building,
eral years.
from
to Vice Presi¬
•
;
26.4
'
way
Assistant
21.9
,
54%
.
h,'
21.5
26%
30
;:+
16.8
56%
63%
..
North
23%
69
*
La-
C.
peyre
Trust
5.2'
25.8
;
they have received."
ment
]V, 31.5
790
58%
National
United
1.9
America- ;/ +10.5
—25.8
Manufacturers
Fire
Paul F.
+
17.8
12.5
,
45%
•
13.6%
89%
90
24%
V
J
^12.8
—
_
_
of
National
ot,
56%
a:
+-7.1
_
•
_
Insurance
Insurance
Prov.
50%
6.3
+1.7
Hartford - Fire
Home
O.5..
•—16.2
_
.
628
46>/2
58 Va
20%; *
7% r>
'
'
-
80
20%
+
Franklin
s-7y«!
3.2
'.+
Association
Falls
7
,
n.c.
+
FidelityrPhenix
Glens
''
',]-•#12.1
C.iiy of New- YorkContinental
Fire
15%
;;,v
8.0
—
•
Andre
Year 1945
12-31-45
76
V
.
4.1
+
-
______
Shippers
Appreciation
511/2
5.9%
—
_
_
Vice
to
President;
1945
Asked Price
12-30-44
Change Year
Agricultural
1945
AND
Asked Price
1944
'•
1944
W.
SUMNER1
JOSEPH
FORD
B.
D.
PIKE/
<
KORELL
V.
/
.
1
:
>
1
[Directors
TAMNEYJ
257
I investment
Brig. Gen. Browning
Appointed Director
of
I American
Of- the Franc
Domestic Commerce
of Commerce Henry
Secretary
A. -Wallarce announced
Jan.
on
11
the appointment pf Brig. Gen. Al¬
bert J.
®
Browning
Office
the
.
Director of
as
of
Commerce.
this
In
*
ca¬
i t y, Gen.
Browning willrespon¬
program
perfecting
organiza¬
by which
the Depart-
prepare
same
order in favor
and consideration of the fact that
during the coming years the coun¬
try cannot escape from the rigid
ruling of a controlled economy,
should create an adequate basis
for the revival of general confi¬
dence in the monetary unit. H ^
It can, therefore, be asserted
charge its re-
ibility
spons
the
pro¬
motion
a
d
n
I support *ȣ the
nations do,
mestic
',
...
'
.
that the present
inforced by. the
.
Albert J. Bro„n.»s
com-
-
appointment is in line with
Wallace's recently-announced
.His
Mr.
the
to
Gen. 7
terminal
far
the
Army
the French
of
Forces, is accepting the
appoint¬
a temporary basis, in the
expectation that he will return to
private industry after; three ; or
ment on
v
four months.
pany
the franc will give, them the con¬
ice:.
impossible to rebuild their
7.
with
and
will
provide
stimulus
•
change is definite¬
ly limited.
The second
question
oermit
such
Firstly,
let
does
absolute
an
mention
us
of
French
birth to
new
:
^
cerned
with
genius—to
A
reconstruction
and
renovation...
;
<•
of
Chicago
and
ports
and that, consequently,
a
graduate of Massachusetts Institute of Technology, Gen Browning won the Distinguished Service
t Medal for his work as Assistant
Director of Materiel and, previ-
b
■
rate
to
advantageous
as
Director"of Purchases, in
the War Department. In these ca¬
pacities he was principally re¬
sponsible for setting up and ad¬
ministering the Army's Purchasing Program, and for the formu¬
lation of policies for War Depart¬
ment procurement agencies.
ously,
the 1 Army,
entered
he
Before
served successive¬
Assistant Coordinator of
Gen. Browning
ly
as
the dollar.
On
this
Advisory Commission; as Deputy
I Director
of
Purchases,
in
the
Office of Production Management,
Donald
Nelson in the Supply, Prior¬
and as special advisor to
ities and Allocations Board.
presi¬
dent of United Wall Paper Fac¬
From 1938 to 1942 he was
tories, Inc., of Chicago. Previously,
|he had been merchandising man¬
ager for Montgomery Ward and
Company.
some
;;
were
1
1
GALION.
OHIO—Glenn
Rich¬
South Market Street.
*
>
Banking Houses and Equipment
.
.
Other Real Estate
time
materials
and
4
21,524.53
1,060,239.95
v
....
1,761.07
319,285.76
goods—which is
black
market.
Acceptances
and Taxes
Capital
.
«
...
.
.
.....
.
»
«
ROY
M.
.....
*
.
Great Northern Railway
1,447,744.02
.
$
...
3,000,000.00
.
.
.
.
'.
2,623,290.02
v :
.
.
14,246,192.80
7,7 3,622,902,78
*
glenn
'
7:
carrington
!
Glenn Carrington
J. W. MAXWELL
ill®
,
Company
V
EVAN S. McCORD
Kerr, McCord & Carey, Attorneys
J. IRVING COLWELL
BLAKE D. MILLS
Chairman Advisory Committee
Director, Graybar Electric Company
IRA W. BEDLE
Vice-President, Washington
Vice-President
Securities Company
•
W. C. PRATER
Investments >.-■.
darrah corbet
-
'
University Branch
"
'
W. A. BELL
-
Chairman of the Board
.
& Company
J
-
"m.-,
■
v.\
\ /.
President,
"t
•,
E. K.
■i.'1
agreements, should not fail to
bring about a radical change both
inside and
outside the country
with regard to the security of fu¬
ture investments in France: con¬
,
' President, Smith Cannery
'
President,
E, K. Bishop JLumbet
:
-
Director, Boeing Airplane Company
President, Marine Bancorpotation
KEITH G. FISKEN
OTTO R. RABEL
President, Star Machinery Company
j
v
"
Company
BOYDS'/'v:
Vice-President
-
,
„
Vice-President, Seattle Cedar Lumber
'
g
Manufacturing Company
LEO. S.-BLACK
1 >'
Treasurer, Seattle Cedar Lumber
Manuiacturing Company ; / -
■"
President
BISHOP
Vice-President
7
ANDREW PRICE
j
Machines Company
1
President, Marine National Company
witness
7
Yakima Hardware Company
can
of
«
.
BACKUS
Vice-President
shall
319,285.76
.
5,000,000.00
THOMAS BALMER
stabilization, officially sanc¬
tioned ; by French^ Anglo-Ameri¬
we
.
President,
7 This
future
.
DIRECTORS
LE
aspect of
spontaneous reversal of the
130,507.32
$446,294,098.91
monetary reform on which
both, advocates and opponents of
the devaluation will agree,-that is
near
.
■
the
i.
.
.
••
•
Contingent Reserves
after four years of German plun¬
dering/ Hi therefore; as J t lis to he
hoped, the devaluation will be
followed
by only 'a
moderate
price-increase, this would be quite
a reassuring symptom.
the psychological effect/
.
,
f
Surplus
Undivided Profits
reforms,
.far-reaching, can n o t
alone rebuild the French economy
an
.
.
.
$430,150,369.01
♦
Reserve for Accrued Expenses, Interest
however
However, there is
V
Liability under Letters, of. Credit and
the basis of the
Financial
*-
i
.
Unearned Income
R. M. HARDY
GORDON N. SCOTT
v
:
'
President,
Vice-President and Treasurer
Sunshine Mining Company
7
WYLIE'HEMPHILL
: ;
.
*
Hemphill A MeRillop
7
President, Pioneer Sand A Gravel
77"'/ v: Company ■.-7
S. F. Ostrander Corp.
,
,
HERBERT WITHERSPOON
Vice-President
■v-
a
flight
capital from France and also
The National Bank of Commerce
Australia and New Zealand
'
OF
BANK~OF
HEAD OFFICE
S E ATT L E
Second Ave, and
(ESTABLISHED 1817)
Spring St.
•
..£8,780,000
Reserve Fund,
'
•
6,150,000 -t
Reserve Liability of Projv- 8,780,000 •
Aggregate Assets 30th
Sept., 1945 J_ «i./__» _£223,163,622
220S Market Street
9 Mercer Street
ELMA,
♦*ILWACO,
Ave.
COUtEE CITY, CENTRALIA,
KENNEWICK, UCONNER, LONGVIEW, MONTESANO.
OLYMPIA, VANCOUVER, WAPATO, WATERVILLE, WENATCHEE, YAKIMA
THOMAS BAKER HEFFER,
Head Office:
Manager
: ■, 1
and ZILLAH
Complete Pacific Northwest coverage through branches
w
and direct
Geprge Street, SYDNEY
correspondents
LONDON OFFICES:
x
also undertaken
queen anne office
Offices at ABERDEEN, BELL1NGHAM, BREMERTON, BREWSTER, CAMAS,
ELLENSBURG,
General
Trusteeships and Executorships
BALLARD OFFICE
J
Paid-Up Capital.;
£2,000,000
Reserve Fund-___—.—£2,200,000
Bank conducts
every description
banking and exchange business
East 45th and Brooklyn
Westlake and Olive Way
£23,710,000
Bishopsgate,
London, E. C.
26,
University office
CENTRAL OFFICE
$
Paid-Up Capital
the Government in
Subscribed Capital—-l-.£4,000,000
:
1,727,964.09
.
..
Branches in India, Burma, Ceylon, Kenya
Colony and Aden and Zanzibar
The
240,000.00
.
........
Earned, not collected
DEPOSITS '
"
lt-'*'
manufactured
Kenya Colony and Uganda
7
4,860,695.50
LIABILI TIE San d CAP ITALi
foreign
and
domestic
prices in view of the scarcity of
of INDIA, LIMITED
Office:
$381,011,333.0f
$446,294,098.91
between
NATIONAL BANK
Head
6,941,472.49
*
Other Resources
NEW SOUTH WALES
Bankers to
271,112,025.57
.
^ Customers' Liability under Letters of
Credit and Acceptances
.
...
,
,
engaging in the invest¬
ment business from offices at 134
.
«»
29 Threadneedle
47
Street, E. C. 2
Berkeley Square, W. 1
**
Agem-
arrangements with Banks
throughout
the U.
S. A.
A« of January 25.
•
,'7
Special
Alaska Department supervised by former
Member Federal Deposit Insurance
Corporation
20
Bache
associated
years
Commodity
57,051,294.94
Federal Reserve Bank Stock 'v
Interest
;
On tiie other hand, it is too
much to expect that the devalua¬
tion will immediately do much to
correct
the
enormous
disparity
raw
York
ment.
Loans and Discounts
sequently, it is likely that in the
ardson is
N ew
of for¬
source
■
been
for
Securities, Direct and
.
eign exchange is not likely to ex¬
ercise very much influence for the
"
firm
the
$102,957,835.01
,
to
resumed his activities
has
remain only too scarce. As for the
tourist traffic, this
has
Tessler
C O NDITI ON
OF
Fully Guaranteed.......
Municipal and Other Securities . .
HOMER'Li
(Special to Tint Finance Chronicle)
Mr.
with
orginally
Other Bonds
-
,
Glenn Richardson Opens
Baxter
Cash and Due from Banks
the
area.
Co., 36 Wall Street,
New York City, members New
York Stock Exchange, announce
that Sydney A. Tessler has re¬
turned to the firm from duty in
the European Theatre with the
Finance Department of the Army.
joined
Hayden, Miller & Co. in 1930 af¬
ter graduating from Miami Uni¬
U. S. Government
ap¬
&
Bache
RESOURCES
point, the
exported is and will for
Tessbr Returns
war serv¬
December" 31,1945' |l7|7
certainly right, and the more so
since expectations for a consider¬
Purchases in the National Defense
M.
Mr.
f
•
.,
after absences for
7,777|;7:::|';^|7
At the Close of Business
50 francs
as
opponents of the devaluation
next two years.
-'
1
•
as
sels in the Southwest Pacific
Frost, Jr. and Dana F.
rejoined the. com¬
STATE MENT
national interest would have been
to maintain as long as possible a
.•
resident
give
con¬
Commerce
that Har¬
announced •
reserve
have
not
products sections of the Bureau of
Foreign and Domestic Commerce,
together with the sections respon¬
sible for wholesale and retail dis¬
tribution, transportation, building
construction, and the service in-
under
dustrics
the
ideas while still
fact
aggerated. The merchandise to be
and
commodities
also
to
necessary
C.
Hayden,
—
Union
answer.
the
able increase in exports, owing to
the devaluation, seem grossly ex¬
have
coun¬
them
spirit of initiative—so character¬
istic
Co.,
In February, 1942, he en¬
listed in the naval
prentice seaman, subsequently be¬
coming a lieutenant commander.
He was assigned to ship and shore
duty off Iceland and later was
aboard salvage and rescue ves¬
77
Mr.'Frost, who was associated
with Hayden, Miller & Co. from
1928
to
1941, served : as major
with the Ninth Air Force. He was
a iL.lso.1 officer in the
European
theatre, being stationed in Eng¬
land, France, Belgium, Luxem¬
bourg, and Germany.
fidence Without Which it would be
try,
&
Baxter
and, if not so, the scope
him the
manufactured
will
He
con¬
are
cerned, the definitive stability of
.
Assistant Director
Materiel in the Army Service
after serving as
/
CLEVELAND, OHIO
Miller
Buildnng,
as
,
from
leave
the
rison
As
"; v •-/I > r that for a Jong time to /come
Browning, .who > ison French imports will exceed ex¬
>of small business.
in
stabilization, re¬
Bretton Woods
of fundamental
group
cipal headings—promotion of for¬
eign trade, of domestic trade and
.
measures
the operations of
Department under three prin¬
plan
offered
agreement, precludes for at least
a •. given I time
other
monetary
"
mfcrcd and industry.
opportunities
markets.
the
vnent will dis¬
the
versity.
Frost, Baxter Rejoin
Hayden, Miller & Co.
once more to take advantage of
atively the first question is small,
in reality, this devaluation is iak.ng place simultaneously with the
application of the Bretton Woods
conventions, the aim of wnich was
tion
for
capital. There is
French metropolitan and colonial
of other allied nations, undoubt¬
edly including France.
Ah important loan to France,
and
■
(Continued from page249)
affirm¬
loans of the
sibility for
f o r m u lating
the
I
the currency stabiliza¬
tion of the post-war world. Apart
from- this fact, the simultaneous
granting by America to Great
Britain of a $4 billion loan indi¬
cates
the
probability of other
ll a c
have
new
that capital from the
continent will be able
future events in answering
o
Domestic
,
of
(little doubt
Alaskans
|
and
in the
Depart¬
FINANCIAL CHRONICLE
THE COMMERCIAL &
258
'
■
-
'
-
')
.
:
current issue of keynotes.
issues
are
made up
1,295 Bonds
631
»'
,
These
follows:
as
:
y'ZZZZi
•
Preferred
1,504 Common Stocks
Threatened Tie-Up
,
The
fect
on
|§|
is
Which
|;|||| ft
obviously
wide
a
spreading wave of strikes throughout industry had little ef¬
the investment business until the partial shut-down of wire
one.
the best selections
.are
his investment account?
.
.
"The majority of investors have
neither; the time, the experience
service last week,
A complete tie-up of these com¬ nor ! the available sources of in¬
munication services on a nation-wide basis would pose many difficul¬
formation
to
investigate
the
ties for the investment business, particularly for mutual; funds.v
thousands
of
securities
in
the
Orders would have to be confirmed by mail and, to assure fair listed
and
unlisted
markets, to
treatment of present shareholders,
r~ ~r
select
the issues be:t suited to
■
received.
of invest¬
ment company sponsors sent spe¬
cial mailings to affiliated dealers
orders
the
time
Last week
were
number
a
pointing out these difficulties and
netting up procedures
for the
handling of business,by mail in
the event that the threatened tie-
this
We
new
color
of
tance
the
company
and
"One solution of this
to
of pertinent
erate
and
A prospectus on
a
?
Op/L
from
% YOUR INVESTMENT DEALER
Distributors
groyp, Incorporatfo
63 Wall Street
*,
New York 5, N- Y.
...
yame
the
investment
of
gree
maintain
will
a
cbntinuouk direction 'of
his
investment program
not
required in
which* is*
broadly diverbi¬
a
fund."
"There are
individual
m<y*ir
stocks
NATIONAL
Securities Series
Stock
this
a
.
;t".'."},■ ■'ij-"'••a:i£.••/.*)*■
.
y'® ,m. '•> •-'*
'„■/ fy-
'J'y"
vl-vv-'.v:
yH
Prospectus upon request from
your investment dealer or
such
serious decline,
these
other
two
as
fol¬
:periods,
,on
Exchange
the. New
.York
New
York
and
and
in
in
We believe
1946.
that his¬
well as on economic
financial grounds,, there is
as
reason
for" confidence than
$
-t
In
a
current
if
such
as
those
stocks
comprised in the holdings of Low
priced Shares and Fully; Admim
Shares.!'
istered
®'-.
'■
.
.
'
•
■
Year-end Funds
■v
'
"Invest those year-end funds
Commonwealth,"
Investment
Bui-
Fund.
Five
ir
N or t F
writes
Securities
reasons
in
Co.
memorandum
current
■:
.
tions."
Ease
are
listed foi
making later
of
addi¬
13. Maintenance or improvement
dissipation of capital.
Basis
5.
changes in Lord, Abbett funds
during the final quarter of 1945.
1
Prospectus upon request
1945
many
for
Seemed
o
f Boston
i
a
York
.
,
j*
.
Chicago
•
;;;
of
.
General
road?
Bond
Bond
.
.
Distrib¬
portfolio
Priced
Low
on
Shares,
and
Shares
Shares:
Rail¬
cur re n
t
monthly price record.
Dividends
Republic Investors Fund, Inc.—
A
regular dividend of 5b per
share, plus an extra dividend of
5 ( per share payable on the com¬
mon stock Jan. 31, 1946 to stock
Institutional Securities, Ltd.—A
quarterly; dividend of 2Cb per
share payable Feb. 28, 1946 to
Stock and Band Group share¬
holders of record Jan. 31.
!eb®W®Beaver With
in N. Y.
for
exception.
Inc.,
\
..
•
; '
- *;
^
Philadelphia
•
announce
Beaver
has
that
W.
George
become
associated
•
*v t-*
.
f L/-
Wall
Street,; in charge of the
firm's municipal bond department.
Diversified
"
'. Lbs Angeles
For the last 12 years Mr Beaver
has been manager of the munici¬
pal
bond
Fund
&y'\
..y
*
*
department
of
F.
S;
Moseley & Co., and prior to that
served in
The
N.
a
similar capacity with
W.
Harris
Co.
and
Kountze Bros.
r.'' 'j-/®
A SERIES OP
NEW YORK
STOCKS, INC
Selected
american
shares
S-L3 SI®
inrc.
Prospectus
Boston 9, Aiass,
Se¬
as
with them at the New York office
be obtained from
may
..
j Prospechij from your Investment Dealer or
I
Pre spectus
'
your
local investment .dealer,
may
or
hugh w. long & co.
Keystone Company
50 Congress Street,
Important."
Group—Current
utors
63
'Funds ■;
;.i<y ■■■':
Shares
Dec, 31, 1945; current issues of
"Selections" and "These Things
Ciistociiaii
The
American
on
Schoellkopf, Hutton & Pomeroy,
has been the best year
mutual funds and Selected
Lord, Abbett & Go.
-V"v
or
Co.—
Investments
memorandum
future investment.
American Shares is no
mismmmi
New
be obtained
Selected
...
Portfolio
Best Year
Ke|lstQTie!
map
mem¬
Considera¬
.
of record Jan. 18,
of diversification.
i
local investment dealer
weekly
"Current
.
.
i
1. Flexibility in buying.
2.
SHARES OF CAPITAL STOCK OF
your
De¬
Lord, Abbett-^-Current
issue of Abstracts giving; portfolio
this
on
Investment
Prospectus
Investment
.
.
tions.
INCORPORATED
from
Invest¬
dustries,
American
for concern."
of
Period of Inflation"; also the
a
folders
be found in other in¬
can
and
.
current issue of the
equipments
fhe^ steels? | individual in¬
4..No
New York 5, N.:Y;
in
railroad
the
issue
Hare's Ltd.—A new
fplder entitled "Insurance Stocks
such major industries as the rail¬
stances
Shares, Inc.
?./
National Securities & Research
partment.
The
stocks
Barclay 7-1346-
are
Economics
investing ii Commonwealth:
NATION At SECURITIES &
120 BROADWAY
selected
l«?
yw ^ y
Timing in which the Im¬
practicability of 'Ability to Pay'
As a Criterion for Wages" is dis¬
cussed by L. Scudder Mott of the
prices even of those, many stocks
which are already high in rela¬
in
'v,'f / i;
ment
current
monthly Invest¬
Report on Group Securities
States: "The general outlook is for
higher prices for everything, in¬
of events?
"After giving weight to these
negative factors, we nevertheless
come
to the considered opinion
that security nri^es will he hi
quence
more,
Curb," writes Keystone Co. in the
They
Corp.—Current
The
available
!
j
Mutual Fijud Literature
above the 1937
cluding most common stocks.
Dealers
to
r*
;
ment
roads,
A merican Business
RESEARCH CORPORATION
81%
than
of three direct wires to its order
level."
(1929 and 1937), to* be presently
anticipated as the normal se¬
and
pfr bonds] and
Shares
Marker
of
Stocks
torically,
approximately '3,430
SPECULATIVE
ar
folder
above
and
Selected's
1945
/National Securities & Research
Corp. announces the installation
will reach an all-time
$76 billion
last
year's record
year
volume
;
Priced
i
lected
.
1
SERIES
Notice
record level of around
—6%
of
were :> more
as
white.
er
issues
listed
an
S li are s
Merchandising
end
$ 15,compared with the
highest previous year-end- total
of $11,500,000 at the end of 1036.
"
r3,430 Securities
of the
outlook
unbridled
lowed
de¬
the
assets
orandum
Is
time^ their use "assumes /that
investor
the past week included a
year
600,000
hand
during
Group
At
;
net
price, based on their present and
carefully estimated future earn¬
may no longer be
bought at the low levels which ing power.
I "Good value, on such a basis, is
prevailed during the war years.
which are not present in
broadly diversified fund; at the
fied
One
his
over
a
mailing included a de¬
folder entitled "What
Dstributors
com¬
assets for any
in the company's
net
history.
Other mailings to come to
frcm
performance
largest rise in the
calendar
mem¬
scriptive
Mutual Funds Mean to You as
Investment Salesman."
'
The
is generally an¬ tion to their intrinsic values will
ticipated, but the events of the probably go substantially higher.
stocks
moment having to do with prices, Purchase of such
is, of
wages, production ; and interna¬ course, pure speculation. The in¬
should confine his pur¬
tional relationships are ample in¬ vestor
dication that seldom, if ever, is chases to those stocks which offer
anything either all black or all good value per dollar of market
".
program
Request
■
control
and
down; light-heartedly nor
optimism. Peace¬
set
with
corporation's 20
Industry Series, the report says;
''offer the investor a flexibility
,
new
Investment
for
1946,'' writes this sponsor, "cannot
the
of
a
statement of their; invest¬
a
time prosperity
Shares
gives
Group
of
Companies." "The
doubled.
i
Abbett
Abbett
number of its shareholders nearly
3.
7-8.
policy in booklet form un¬
der the title "1946 and the Lord,
corporation
The
bers.
in
NASD
to
the
over
pany's/total
deskv
nearly
tripled during- the fiscal- year, ris¬
ing to $25,621 ;364 dpmpare^with
$8,619,811 a year earlier.
The
the
sold
by this sponsor that "retail sales
be
of
mailing
history.
a
greatest margin of im¬
provement
"1946"
signed by Hugh W.
Long, President," shows that ■ net
assets
Group
Distributors
-
■,
of,the; pow-Jones Industrials than/
in any other calendar year in the
company's history.
$51,655,696.56 of Group Securities,
Inc.
and
received compensation
therefor of over $3,000 000." Thus
writes
The
Group Securities with an estimate
ment
The report
2.
Results
600 dealers
in the company
year
.
over
.1.®,
,
The greatest percente^e rise
asset value for any calendar
in
Only one of the 30 individ¬
stocks,
National Distillers,
with an appreciation of 100%, did
1945
the
1945
Fund's
1.
age.
ual
♦"In
Co.,
of
some
this
record:
Fund
better.
"Best
Investments
recites
sponsor,
on
with
Series of
During .the ,year Affiliated
appreciated 62.2%—almost
times • as; much as. the Aver¬
Selected
high; points in
Aver¬
Industrial
Dow-Jones
age;
eco¬
capital
year-end forecasting, by- publish¬
their
conclusions
together
of each.
the possibilities
be done
ing
Stdck, but it discusses
frankly and
without reservation
the investment limitations * as well
as
can
the
with
the
memorandum entitled
a
Year"
with; other investors in profes¬
sionally supervised trust funds."
Lord,
Special
STEEL
this
means
attractive slant to the business of
information on
each of the company's 23
For the investor of mod¬
them.
combination of attractive,
give shareholders an unusual vol¬
ume
problem is
employ a research organization
perform
these * services for
to
Fund
of ithis
performance
In
Lord,
the 1945 market
compares
special
•: ;
.
nomically by pooling his
face-lifting operation
a
neeus,
constant
their investment lists.
its
Quite a transformation has been
taking place in annual reports
during recent years. In most in¬
stances ' the
job has been more;
just
and then
vigilance on
the performance of each issue in
business should be maintained.
dignified appearance with a clear,
simplified
presentation, of the
facts is nicely achieved in the an¬
nual report of New York Stocks,
Inc. for the year ended Nov. 30,
1945.
Not only does this report
than
investment
maintain
to
reports actually over-done to the
point of garishness. We still be¬
lieve that a measure of dignity
commensurate
with the impor¬
This
New York Stocks, Inc.
their
frankly partial to
are
trend although ill the in¬
dustrial field we have noted some
should materialize.
lip
.
with pictures, charts and
added.
Fund,
Affiliated
on
Abbett
for
.
and telephone
prices would necessarily have to
be subject to confirmation at the
letin
.
each of the 30 individual stocks in
Stocks
;/'The choice available, to the in¬
vestor,
Thursday, January 17, 1946
i:
:v*m
be obtained
from authorized dealers, or
INCORPORATED
THE
PARKER
;
CORPORATION
ONE COURT STREET. BOSTON 8. MASS.
®
48 WALL STREET
"634 SO. SPRING ST.
NEW YORK 5
LOS ANGELES 14
SELECTED INVESTMENTS C0MPA
135 South Li Salle Street
CHICAGO 3, ILLINOIS
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4456
163 !
Volume
and
Bell Telephone of Canada
near
inklings
were
future with
a
•
place
since
view to obtain¬
The
the
1957
in
I960,
and
securities,
on
its
a
lower
series
basis,
cost
bonds,
D
out-;
000,000 carry only
314%
a
cou¬
formerly
down the reports were
convinced
that
immediate
in
there
funds
his
for
this
,
'
.■::
•rivtf-
V-ri'v
•
week
issues reach¬
ing the actual offering stage, and
rwhat with only four
these all equities.
Tennessee
*
Gas
Electric
&
Corp.'s block of 812,100 shares
©f common stock ($5 par value)
Avas
offered
yesterday at $12 a
0 rshare and
was snapped up
■quickly. In fact the stock com¬
manded a substantial premium
subscriptions necessitated
scaling down.
and
considerable
described
Dealers
demand
the
"akin to the mad rush of women
.as
ior nylons
offered."
whenever
Meanwhile
they
are
Edison
Potomac
Co.'s offering of 63,784 shares of
a
and
price of 100.159 for a 3.60%
dividend
offered
rate, was due to be
subject to prior sub¬
A block of
rumors
every
day. Some folks may
But remember
occasionally profit by them
scription by holders of its 7 and
€% preferred issues, at 101%.
■cumulative
of tips
THE GRAPEVINE hears a new crop
preferred, sold to bankers
new
at
will let you down
this: THE GRAPEVINE
40,000 shares of SVi %
preferred of Victor
just
as
surely
as
night follows day!
Chemical Works was placed on the
and met a brisk
.market at $100
This Exchange's
reception.
offering involved
40,000 shares of $3.60 cumulative
preferred stock of Brown Shoe
Co., Inc., priced at $102 a share
.-for which quick oversubscription
\yas reported.
fourth
The
The week's
only bond Issue,
$4,800,000 of
s,
was expected to find a
ready market with no little of
the loan believed destined for
v
Seattle
areas
Co.'s
Gas
with
widely pub¬
so
estimated these
that
today it is
owners are
to be
lished words:
found in
"The well-established
principle of
families. The risks and rewards
disclosure of facts, as the basis
involved in America's productive
be
out of every
one
four
which security values should
judged, is the
essence
shared by the
progress are
~of 7*
many
—and not the few.
Exchange policy. Tips, rumors
Stocks Ahead
near-term
prior "rights" going to pres¬
in¬
ent holders of the corporations
volved in most instances.
4
made clear in these
upon
future the
aroster shows the bulk of offerings
will
consist of stock
emissions
the
For
lions of homes
"grapevine information" has been ;
•
outside the East Coast.
More
enterprise has spread out to mil*
disapproval of
and impulses
have
serious business
no
place in the
of advising in¬
vestors."
Columbia Pictures Corp.'s 75,00Q
:
nondetachable
Avith
preferred,
of, cumulative
shares
warrants
earnings?
to
This widespread ownership
new
common
stock,
reach market* some time
purchase
^should
been
next week.
The
holds
same
Facts
stockholders
scribe for the
ratio
of
new
V/2
shares
for
shares
now
company
entitled to sub¬
are
preferred
20
4%
pany agrees
basic facts
held.
cumulative
series
pre¬
at least any
unsubscrib¬
ed portion of the new issue, should
become available, since subscrip¬
tion rights expire next Tuesday.;
ferred
or
Still Up in the
.government has the constitutional
^
xight to levy an excise tax on
amineral water made by the Sara¬
toga Springs. Commission, which
an
was
scrupulously
raised
1
impose
.■
•
avoided
question
of
Tight
■'
«
they act they seek out
the facts. Thus, they are able to
based upon
judgment,
facts.
;
-
,
;
Never before has there been avail¬
to
so
much factual information
guide responsible buyers and
sellers of securities.'
a
federal
tax on
score
matter
on
and
the
again
doorstep
for settlement.
I
*.<>.•
•
-v;
bas&l upon
fr
the supply and de¬
,
*"V
*
«
»
U-
,7,J
*
*
"
\
*
transactions
Such
a
;
*
"■
t
are
<c
«*•
''(\
asset.
-
i<,
^ ,
,'t
completed.
market—free, open and
honestly conducted—is
a
national
But, just as j:he highway
builder cannot guarantee the
safety of all who ride the roads
he builds—this
the
you
Exchange cannot
against risk. You,
investing public, must be the
"careful driver"
Over the past century
"
might
left
of
the
that
Con-:
%
and
a
half,
ownership of American business
•
mand in the market at the time
highway
the
authorities to
income from
be subject to interpretation on
latter
.
bought-— promptly, at prices
on
this free open
the- oft-^
anything that
sidestep
they' 'V"cab sell what they-\K*have
"r''-'j*
v,' <r k
safeguard
J:
The Court appeared determined
gress
Wise, experienced investors know
this. Before
able
v
opera¬
regarding
state, or municipal securities.
to
concerning its
\i
,
noted that the decision
ready market in which they know
and financial condition.
instrumentality of the State
of New York.
It
tions
to report, regularly,
exercise informed
Air
Municipal bond men found little
xeason for worry in the ruling of
the U. S. Supreme Court this
week
holding that the federal
is
facilities of this Exchange an open,
lists its securities in this
common
At approximately the same time
Carrier Corp.'s 120,000 shares of
anew
available. Before any
investors' marketplace, that com¬
issue in the
new
each
arc
has
possible because investors,
large and small, have found in the
of the
true
149,883 shares of cumulative
preferred projected by Philip
Morris & Co., Ltd., Inc. Common
to
broader national-
ownership of American business
enterprise.
is
finally
nothing
prospect so far -as
issue market afforded
new
Einhorn & Co. Inc.
,
£
oV^Y-v''
^
CINCINNATI, umu-^xnhom
&
cerned.
would finance, through new
/
has been budgeted for this year.
financing by this company is con¬
potential investor only meager
■outlet
the
im¬
provements and extensions which
run
part on the belief that the com¬
pany
of
for
part
expenditure
However, those who sought to
Reports probably were based in
series B
least
at
$28,200,000
pon.
The company has outstanding
total of $37,500,000 in first
mortgage 5% bonds of
due
standing in the amount of $25,-
ing new capital, or perhaps re¬
financing certain of its debts. • ;
a
C,
which undoubtedly it could re¬
around
the investment fraternity indicat¬
ing that the Bell Telephone C6. of
Canada might be inclined to come
into
the money market
in the
There
259
Co., Dixie Terminal Building,
a
partnership, is now do¬
ing business as a corporation, with
William
Einhorn
as
Treasurer, and Director;
Einhorn,
President,
Jeannette
Vice-President,
Secre*
tary, and Director; and Stanley C.
Eisenberg, Director.
THE COMMERCIAL & FINANCIAL CHRONICLE
260
The "Full"
Canadian Securities
(Continued from
247)
of the
United States' which also is large¬
ly preamble material in nature,
a
By BRUCE WILLIAMS
«
the
In
being given
current
are
a
our
Dominion-provincial conference Americans
preview of what this country must some day face if
tax situation
current muddled
to
come
is
be clarified,
to
ever
Canada has
is
that
question but
no
this
'
' : ,' :
The major defects of H. R. 2202
taxes.
It would
power
of the central Government.
taxing powers to the
provinces.
A-';
Canadian
canadian
\
bond
t
•
■:
quotations"
■
AHA.
:;,T
re¬
are
tacked
of
tions
Canadian
Copies of
bonds.
pamphlet
a
con¬
taining 350 quotations
available
ance
to
are
the proceeds,"
most
"Financial
Post"
of
Canada
and
our
reputable
both
their
accuracy
practicability.
the
bill
in
now
the
conference
committee, is the provision for
"National
edi-
Production
ployment
called
a
and
a
Em¬
Bu d g et,"' commonly
"National
Budget"—a
budget that far exceeds in com¬
v
plexity of concept
v
our
large and
who deals with local authorities is
companies and other
beter off in the long run than the
tax payer who is subject to an in¬
proposed
creasingly powerful central Gov¬
the labor force and the estimated
ernment,
aggregate volume of investment
expenditures by private en¬
terprises, consumers, and state,
local,' and Federal governments
supposedly required to .produce
the gross national produce deemed
request.
complicated Federal Budget. The
"National Budget" was
the
in
Canadian
of the
problem.
dian business
discussion.
ing of
XbxiNioH Securities
Grporatiox
40 Exchange Place,
Bell System
of
New York 5, N. Y.
Teletype NY 1-702-3
A:
who
minded
that
think¬
govern¬
estimates of the contemplated in¬
necessary,
be
is
vestment
sive; in the long
run
dividual
liberties
tional Budget program, including
such foreign investments and ex¬
and
his
to the in¬
l
other kinds.
*
9
"
Latest
the
as
,
'
show
-
■
,
Canada's
tracts awarded in November were
138.1%
over
the
same
month,
a
earlier
with
the
biggest
tain, 408.3%, in engineering con¬
year
struction
tial
awards.
category
industrial
was
*
showed
:f
residen¬
98.5%
up
construction
smallest gain
of 70.8%.
PROVINCIAL
The
and
with,
the
CORPORATION
divisions.
The
tional
strong in all
increasing favor
A-E. AMES & CO.
§| 3'/zs
Feb.
\r::
TWO WALL STREET
|
NEW YORK 5, N. Y.
notice
on
on
'
Erector
•
2-7231
' -Y-lr
-
.•
j
•
v
sixty days
any interest date
NY-l-1045
:'rl;^
120
Broadway, New York 5, N.Y.
f;
231
So. LaSalle
continues to
St., Chicago 4, 111.
v
iptzyi;
is
meet
supply ' situation
limited
gradually forcing these
more
into line with
issues.
Ernst&Co.
•
our own
.
As
j
V'.'-Vi -y
Government; bonds of ,a compar¬
maturity.
.
;
There is still, however, a sizable
spread in favor of the Canadian
externals, with yields of over 2%
available on the 10-year bonds as
compared with a yield of around
10 %
on
comparable domestic
1946
to Nov.'1956
^Callable at par
',7
able
101% and Interest
INCORPORATED
a
'ssues
.
Montreal
to
as¬
country look unpon Cana¬
Nationals
which
•
,
to
to provide for
was
-
in this
$150,000
HVzs
Budget"
•
with
City, of
of pros¬
"full" employment, the "Na¬
dian
.
eral
investment and
His
this
previously
column,
we
pointed out in
believe that the
Nationals
will eventually be reduced from
3% to a 2%% yield basis and
longer
"except >where the
ized
term
Canadian
that continued strength across the
board is to be anticipated.
If, conversely, the estimated ag¬
gregate volume of investment and
expenditure
v
—
Banks
—
$250,000
supposed to be required to
4V2%
Bonds, due April 15, 1961
Price
61 Broadway, N. Y.
Whitehall
4-8980
Stock
Exchange
R""al Bank Rldar.
1
and
to
•
.
employment, the President
required to present a program
designed to contract- this volume.
He
mit
also authorized to siib^
was
supplemental
.
Direct private wire to Toronto
revised
or
es¬
or programs, or legisla¬
tive recommendations to Congress
"from time to time," and the rate
of Federal investment and expen¬
diture could be varied to what¬
extent and in whatever
ever
man¬
he
might determine to be nec¬
essary for the purpose of assisting
in assuring "continuing full em¬
ployment."
ner
This "National Budget" was to
be prepared in the Office of the
President in consultation with the
Canada
yield 2.80%
Incorporated
;
14 Wall
Direct
Private
-
>
to
Toronto
&
be
to
Joint Committee
a
National
teen
on
the
Budget composed of fif¬
of the
members
Senate and
Perhaps it would be helpful to
take
of
simpler example of
the difficulties
'involved
gers
of
much
a
some
the
and
dan¬
in that bill because
vagueness and untenable
of some of the
nature
concepts
found in it: What, for
instance, is
"regular" and "full-time" employ¬
ment—how
must
many days per week
work, how many hours
how many adult mem¬
one
day,
per
bers
the
of
family
must
how many
holidays may
at what age may one
work,
there, be,
begin work,
and at what age
may or must one
retire?
How can the notion of
"continuing full, employment", be
applied to seasonal workers j spe¬
cialized workers, migratory work¬
apprentices, incompetents who
discharged, and those chang¬
ing jobs?
Is hot the need; for
ers,
are
"full" employment greatest when
the living standard
of-people, is
lowest,
and
least
their
when
standard is highest? Does not the
idea of "full" employment disso¬
ciate
wages
from productivity?
Are not productivity and prosper¬
ity^ ' rather f than "full" ^plbythe major considerations?:
The bill directed the President
ment,
proceed
data
involved
liable
though
as
the
on
were
elements
complete and
re¬
could be made available
or
when heeded.
make
statis¬
our
basic
It directed him to
predictions
the basis
on
of
fifteen members of the House who
data
supposed to study the Bud¬
get and to report to Congress by
omists to be incomplete and uii~.
reliable.
It proceeded
upon
an
were
known
by competent
econ¬
March 1 of each year.
unwarranted
Serious questions arise concern¬
ing the concept of the "National
Budget." Its reliability and value,
deficit in what might be supposed
to
be
the
"proper" amount; of
spending
quite apart from matters of pur¬
pose and practicability of admin¬
be stated with accuracy, and that
this deficit could be related in a
;
istration, rest
such
other concepts
upon
of
those
as
national
gross
definite
assumption
and
manner
ment which
investment and
and
so
expenditure, teg¬
employment,
regarding which our
full-time
and
ular
on,
statistical data
inadequate and
are
that '
.investment
a
could
to the unemploy¬
prevailed
might be
or
product, the aggregate volume of predicted.
-
A
remarkable fhing about; the
agitation for this bill is that the
•
Administration, which has pub¬
licly; admitted that it does not
questionable character. Most know whether,, this; country is
concepts are matters o' headed toward what it calls "in¬
dispute among economists botfc^ flation" or toward deflation, asks
of
a
these
of
to definition and as to the pos¬
as
sibility 6f accurate measurement.
The literature
is
and
voluminous
nical.
It
these matters
on
highly
is not read
nor
tech¬
under-,
stood by
the layman; nor was; it
understood, apparently, by the
sponsors of the bill.
The fact of the matter
is that
do not have
anything like ac¬
curate data on any of the itemis
which were to comprise this "Na¬
we
tional Budget.^; What we have are
samples of one
and these should
be handled with great care and
circum spection—much rtiore than
they generally receive. For exam¬
ple, to define such an apparently
simple thing as national "savings"'
is far from easy or simple, even
for economists who are specialists
in this field. To measure it with
crude
statistical
sort or another,
any accuracy seems
Two other
impossible.
important factors in
Budget"
the
,
are
national income and gross na¬
"National
proposed
tional product. If we
these / concepts
as
,
sound—which
fact
that
we
they
are
could accept
scientifically
cannot—, the
expressed in
reveal
one
respect
no
relation to national well-
may
income
or
product
in
during the late war, since our ex¬
stroyed
showed
and
up
as
that it be empowered and required
by
law
to
predict
accurately:
eighteen months ahead. An •ex¬
.
ample of this sort of admission is
found in MrVinson's Third Re¬
port v of the
Director
of War
Mobilization and Reconversion to
the President and
Congress, July
I, 1945, especially
pp.
for outright waste
part of the national •
53-54.
It is reasonable to suppose
that,
if the Administration can predict
the total spending, income, and i
expenditures, of consumers, busi-1
ness, state and local
governments,
government, as
assumed
in the proposal for; a
"National Budget" in H./ R, 2202,
it could at least predict with a
high degree of accuracy the reand
the
Federal
;
ceipts, expenditures, and deficits
a
proposed Federal budget. The
fact, however, is that the Admin¬
in
istration has not been able to
es¬
timate receipts, expenditures, and
deficits
in
the
Federal
budget
alone during the ten-year period,
1935-1944,
proaching
with
anything
accuracy.
j. ap¬
-
,
Henry IJazlitt, of the editorial i
Times, in
the issue of Oct. 1, 1945, presented
an analysis of these
forecasts, and, I
staff of The New York
if his data are
accurate, actual
expenditures differed from budg¬
et
estimates by amounts ranging
from 8 to 85% per year with an
average error
The
errors
of 29%.
in
estimating receipts
ten-year period ranged
from 3 to 55% with an average
for
the
error
of 19%.
The range of error in the esti¬
of the annual net deficits
decline rapidly as
penditures for products to be de¬
_
among
'
1
to
terms increases.
This
situation appeared in this country
Montreal
others.
tical
of departments and estab¬
lishments. In addition, there was
national
Street, New York 5
Wires
leading characteristics
members of his Cabinet and other
monetary
,v
income and product. The national
income and product
concepts in
H. R. 2202 contained these mis¬
heads
being.
Their relationship is to
spending, not necessarily to a
healthy production; and a nation
can spend any amount if its gov¬
ernment is so disposed. National
<
Wood, Gundy & Co.
Toronto, Canada
Teletype NY 1-142
J,
assure
"full"
well-being
CHARLES KING & CO.
was
was
have
Province of New Brunswick
Mines
Bought—Sold—-Quoted
Members Toronto
than
be misleading.
For example, an increase in na¬
tional income and product may
Principal and interest payable in New York
.
more
was
in which they can
CANADIAN
Industrials
per¬
by other provisions of law."
-
Non-Callage
STOCKS
to
were
other method is necessary by spe¬
cial circumstances or is author¬
dollars should
I
expenditure.
recommendations
terprise
expendi¬
correction of the deficiency,. The
was
with which institutional investors
CANADIAN STOCKS
and
supposedly required
ume
securities
volume
investment
less than the estimated vol¬
was
Last week the market for Cana¬
dian
estimated
ture for any fiscal year or longer
increase
an
the
pective
sure
MUNICIPAL
frqm the Na¬
for exports and im¬
ports as affect the volume of the
gross national product.
.
The President was required to
transmit such a budget, applicable
to the ensuing fiscal year or such
longer period as he might deem
appropriate, to Congress, at the
beginning of each regular session;
industry ' m a k i n g
"apid strides.; Construction con¬
up
of
expenditures
penditures
*
reports
and
those groups, apart
construction
GOVERNMENT
at
expensive and somewhat
unwieldly—but never as expen¬
jfA
CANADIAN BONDS
of
re¬
costs should
democratic
size
expected prices, to
provide full employment oppor¬
tunities.
It was also to contain
are
solution strictly in terms
a
immediate
ment
However, Cana¬
men
estimated
the
and
to take
mean
include
to
*
do not
we
in¬
timates,
sharply criticized by compe¬
tent authorities, ;ahd: which, for¬
tunately, was not incorporated in
torially in analyzing this contro¬
versy.
That, in our ' opinion, is
as far as it goes.
But all past
history shows that the tax payer
sides
' "v
of
some
been
We admire their courage in going
after an open, forthright solution
•
in
the
One of these features which has
.
*'
experienced
challenged
true
By. this
•
which
banks, insur¬
institutions upon
i
world
vigorously by
and their
comments the
ways
expenditure to in¬
crease;'employment ; and,' to the
extent that these were
thought
likely to prove insufficient, he
was to provide a
program of Fed¬
non-socialist economists who have
is only one tax payer,
matter how governments carve
up
economic
and
relationships
a position
weigh. "Many, if not most, of
the basic assumptions made in this
aspect of that bill have been at¬
companies in order
to allocate the tax funds fairly
among the various provinces.
no
measurements
causal
general public is not in
"There
end valua¬
spect to year
statistical
questions regard¬
to
individual
of
Inquiries invited with
men
forth
sec
non-Federal
formance of such work by some
the
largely in favor of the Dominion
plan. They see an endless maze of
complications in the Ontario coun¬
ter-proposals involving as they do
the provincial break-up of sales
to
was
encouraging
vestment and
signed to provide so-called "full"
employment. This mechanism in¬
ing
individual
business
pur¬
Employment Bills
favor the utilization of private en¬
intricate
.
m
announced
President
of
the mechanism de¬
volved complex
To this, Ontario has replied with
the Drew Plan which restores full
1945 closing
the
but in
poses
the
increase
also
in
not
were
plan would greatly simplify
levying
and
collection
of
the
page
• Voiicy
on
of purposes in H. R. 2202. ':
grips with this problem, with the Dominion Government pro¬
provinces.
There
section
but it at least escapes most of the
absurdities found in the preamble
posing that the power to levy taxes be centered in Ottawa and alio
cation* of the proceeds to be made from that central point to the
"
sizauit:
Thursday, January 17, 1946
mates
in
the Federal
the
seven
from
ror
9
to
budget for six
peacetime
422%, the
years
of
was
average
er¬
being 150%.
With
such
as
a
record
this,
of -predictions
confined
to
three
Volume
163 '
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4456
simp e items in the Federal bude-
assumint' tHere ls no . basis lor
2202 that
mf; tne
(as Administration
dc>ne In H- Rcan
preaict with any accuracy
more items
covering mucn
manv
more
territory regarding which the Ad-
wouw'be 011fS data a"d knowlcdge
liable Mr
less
Mi. SeCtSf.lty<:
Hazlitt putmueh
the matlenaoie.
^
he said: "If
the ^rr^ly
President w^en
cannot accurate!v
^ohlg
estimate
hat Congress is
(though he has a
ftQ>?pend
veto
KV
Can h0r his *88
fccnrL?
e*Pccted
to estimate
accurately what
forty-eight State
Governments
and
thousands
of
cities
towns, hundreds of thousands
nL^VSmeSS flfms and 140,000,000
2lenfte, Soing to spend—when
themselves?"1
n0t eve" sure
•iAFc^Un^ly
for a11 concerned a
considerable amount of data has
been
appearing
the bad fore-
on
Smontns
which by
hasvarious
been made
in
govern¬
reran
recent
connection
ment agencies in
with
mi
im
they
to bring about the de¬
were
sired activity on
part
of busi¬
how they would assure "full"
employment, now consumers' ex¬
penditures would be increased or
decreased as desired, how capital
ness,
outlays of business would be in¬
creased or decreased as needed,
just as though asser¬
tions of this type in a law could
and
so
on,
effect the ends
The- bill incorporated what has
come to be known as a compensa¬
tory economy program, the sound¬
ness of which has been challenged
repeatedly by many of our most
responsible
non-Socialist:, econ¬
omists.
Provision was made for
government spending to take care
"deficits" in the
of the estimated
'National Budget."
tion
No considera¬
given to. the effects of
taxation or borrowing on the pri¬
was
vate
widefv ^encies
and showed
how
the
estimates
deviated
i
v3
posedtobe.
agencies
and
from
^ are now sup-
*
The New York Times
rlt?bCernir,e/reP°rted that in
October, 194d, 12
the Federal experts
estimated
that
8,000,000
people
"nemPlQyed by March,
1946
1946.
perts
R
By
December 12, these ex¬
admitted that they were
_
t^any
b.y 3'000'000- At that
they°ff
estimated that
time
unem-
alwmhnt
in Marcb would
prob¬
be approximately
5,000,000
that the iatter
figure
will
be
correct—and
here
not—,
may
is
an
we
error
of
S?TatelyL38%'- if we use
of fin*J:5 a base> and an error
base
— "Se 5>000'000 as a
What should be of further
.
great
basis
for
asserting that our government's
postwar policies and programs are
generally Well conceived or, heipin fostering production
and
heavy employment and the attain¬
ment of a relatively smooth tran¬
sition
to
a
privatesnterprise
peace-time economy." Leonard P.
Ayres, in The Cleveland Trust
tui
other
to
or
unfortunate
disturb¬
which the proposed govern¬
could have had a series of def¬
we
until
icits
the
public credit col¬
lapsed.
The
bill, like the general run of
on
it by its propo¬
comments
nents, revealed
understanding
no
of the net effects of similar gov¬
ernment
policies in the past, as,
example, during the 1930's.
When a policy, much like the one
pioposed, was tried in this coun¬
for
try during: those years, the econ¬
omy was so disturbed that unem¬
ployment remained at a high level
despite the heavy governmental
expenditures. The flow of capital
into
have been
small
of
group
would
in
control
of
statisticians
devised
have
a
who
of
programs
national expenditures based upon
their
statistical
estimates.
hardly reasonable to
the
of
the
Congress
busy
is
that
suppose
tnirty otherwise
bers
It
mem¬
Joint; Committee
would
have
of
benind the reports of the statisticians
gone
duction is declining, and national
income is
falling." ^Continually
have counted on, had tnis bill be¬
come law and had a serious at¬
since
the
Federal
close
the
of
war,
the
government has actively
pursued policies which foster un¬
employment. At the same time the
key
policy
clamor for
makers
law
a
lege will provide
and-
others
which
they al¬
■'full" employ¬
ment.: The
policies pursued indi¬
cate that these policy makers do
not know what it is that
desire to perpetuate
,
really
to recognize
and
obtained
a
genuine
under¬
nature and short^
raw material used
in sucn estimates. What
one could
tempt been made to
provisions,
its
carry out
that
was
this
Com¬
mittee
and other
advisory groups,
Congress, and the President would
have taken what this small
group
of
managerial statisticians gave
them, and that both Congress and
the
President
upon
such
would
estimates.
they would have
have
-
acted
Otherwise,
defeating
been
the chief purpose of the
program.
The probable consequence
have ; been
the
would
discovery
that,
what qualified
econ¬
omists know to be the difficulties
passage of this bill,
had instituted in
large degree
we
to
the
to
up
level
lowest
the
time
on
em¬
we,
barked upon our armament-pror
gram—to
"remunerative".
was
It did
It
did
not
specify what
a "reg¬
job was
how one was to get it if there
were
no
openings in the fields
where one's qualifications lay.
ular"
and
"full-time"
a
or
The
net
meaning
words
vague
of
involved
all
the
could
be
nothing but government regimen¬
tation of those people who might
be
unfortunate
so
become
to
as
the
victims
that
bill, by its nature, would have
of
the
system which
The
fact
is
to be
were
ment
to
Federally-managed economy
with the management
actually in
the hands of a small
group of sta¬
if
that
made
attempt
an
..
by the govern¬
provide
employment in
the
vaguelythat bill, the
government, of necessity, would *
have to determine when,'where,
accordance
with
worded promises in
and
under
seekers
work.
what
of
conditions
employment
theA
would
This fact is not altered by
the many assertions in the bill that
one
of
its
purposes
and
courage
enterprise.
to
was
preserve
to en¬
private;
';y: \
.
in "solving" the problem of un¬
employment by government ac¬
tion: A government is a cumber¬
tisticians.
Then there is the question of how
if they, are to -go forward in the
the "Welfare State".
to utilize the products or services
best possible manner. The bill did
nature
not
State" is
Indeed, and despite the great;
concern
repeatedly expressed in;
eliminate this possibility.
the bill over the preservation and;
some machine and slow in launch¬
Another serious mistake in that
fostering of free, competitive, pri¬
ing public works. It is difficult program was the unwarranted as¬
vate enterprise, the program in
to start these in the areas of un¬ sumption that
security in the form its essence was a
striking monu- j
employment and^therefore^ labor; of assurance of "useful, remunera¬
ment to a remarkable lack of faith •
often must be moved to distant tive, regular, and full-time em¬
in the virtues and desirability of|
points and perhaps be provided ployment" could be given to indi¬
private enterprise. The faith of*
with
special housing and other viduals by a government without
the sponsors of that bill lay in:
facilities.
Projects, once started, at the same time sacrificing, to
are rarely stopped when the need
an
undesirable degree, the free¬ greater control by the central gov-;
for such employment disappears
doms which individuals must have ernment—in what has been called >
for
which there may be little or
undertakings! There is
to
a
tendency
compete unfairly, with private
point; , below' ? that ^enterprise,
,a
what
not indicate whether rates of
pay
were to
differ or to be uniform.
a
face
The
the
bill
new
fact
to
seems
that
indi¬
an
,and >to
cause
it
•
to
of
the
a
And the true*
so-called
"Welfare
matter that should
be'
vidual cannot have freedom with¬
clearly undersood by all.who wish
out, at the ■ same time, incurring
to
risks.
this
country.
says
the British economist Hayek,
trickle.
declined
ular, and full-time employment"
get it, or who was to decide
whether the job was "useful" and
was to
instituted.
through the
it.
The authors of H. R. 2202 failed
new
mere
record
261
standing of the
comingc of the
enterprises declined to no demand. The
supervisory buThe velocity of
bank deposits, which ip general reacracy is wasteful, expensive,
reflects people's optimism or pes¬ politically minded, and tends to
simism or speculative inclinations, perpetuate itself and to expand it's
a
would
Company Business Bulletin of De¬
cember 15, says that we are now
entering a depression "because
unemployment is increasing, pro¬
possible size of the Federal debt
ances
,
ably
valid
no
tem—assuming.; that • they
widely
Uiese
be
generates
prosperity and heavy unemploy¬
ment in a private enterprise sys¬
so
policies and actions proba¬
bly would cause. Under this plan
for Decem¬
j0
16 list
d the estimates of six
listed
to
far as the
theories in this bill went, taxa¬
tion and borrowing might <be ex¬
ceedingly heavy and disturbing.
No consideration was given to the
economy.In
ment
ber
appears
the United States had
of
a
It assumed that the people
reached
stage in which they were willing
sacrifice
to
freedom
to
their
guarantees
obtain
what
in
maintain private enterprise in
"always
of
fact
starts
It
state.
worry,
"The
out
slave
as
a
state,"
welfare
promises 'freedom
from
want—ap many freedoms
significance is the fact that on
reached at the depth of the de¬ shrink or die, which, in turn, pro¬ would have been a spurious guar¬ as you wish, except freedom from
December 10, President Truman
pression in July, 1932. Facts of vides excuse for still further ex¬ antee of employment.
the state itself."'
/
publicly admitted / that the govthis type were, and are, ignored
The bill did not face squarely
Some careful critics have re-'
pansion of government employ¬
forecasts of
by the proponents ; of this bill.
the question as to how the Fed¬ garded this program as probably:
ment activities.
«C«
f
^accurate. He Moreover its sponsors have offered
Despite provision in the bill for eral government proposed to see the boldest attempt yet, made in
\ ar foe unemployment none that would warrant support
,
,
'
unempfoy-
been
nr
r
at!?
£ asnowasbeen
as serious
drastic
originally an-
or as
ticipat^/The New York Times
December 10, p. 23.)
'
But in the face of th6se ea<?iiv
hHttr?ainable
and widely-pub¬
recent errors
of
maior
licized
a
in
sort
Federal
forecasting
of
unemployment and in the face of
these1'eerrnri S?hbU£
admissionand
of
the President
'
aTLl
J^0Vernment
associates
nevertheless
still urging
Conare
bill that would
a
President to build a
eram
re-
pro-
rnuffl 011 a, 0Jecast that cannot be
wfth
311accuracy.
s notThis
been
made,
with any
is indeed
a
a phenomenon that should
disturb
deeply the thoughtful people of
I1tis meanS that thiS
Administration
wJling to cham-
fn°faa^^r>uram
runs counter
fL
' -I e. existence* of which
tf.
President
and
other
Federal
officials have admitted.
Apparent¬
ly- one
vprv
;
should
that
assume-
hai ha? been receiving
the
some
Jn7^ ?uadvi9e
in this matter,
he d*d not* understand
and „that
what
he
was
recommending
on
December 20 when he
House
insert
and
in
Senate
the
new
urged the
conferees " to
House bill the
principal features of S. 380.
The fact that the President was
authorized, in H, R. 2202, to submit revised or. supplemental esti¬
mates
or
time ,and
i
programs
was
from
time
to
required to review
Federal investments and expendi¬
tures quarterly would
hardly solve
the problems caused by a
program
launched upon the basis of a bad
forecast.
The House
essentially
a
bill, H. R. 2202,
series
of
cut loose from realities.
was
assertions
It stated
how governmental policies were
to promote private enterprise, how
for the theories
which it rests.
on
They have been asking the peoole
of the United States to accept
bill
on
the
advisory
the
and
proposed
other
committees,
"National Budget"
to
it that the person who might
desire
"useful, remunerative, reg¬
this country by
government "plan-
(Continued
;j;
on page
262) ; i-;'i
faith—on the basis of mere
assertions, the declaration of pur¬
poses, and supposedly persuasive
slogans.
This advertisement is neither
improperly took for
granted that even though a nation
has been plunged into a severe
war, with all the attendant serious
and radical adjustments that are
The
bill
will
it
certain
only take
economics,
such
or
an
governmental policies are
wisely conceived and wisely exe¬
These
that,
so
economists
long
readjustments
unavoidable
insist
in-
as
there
are
are
that much
of
our
was
(Par Value $5
Price
and
thinking
of the type
Copies of the Prospectus
Underwriters as
are
assumptions
emanating
chiefly from government circles.
We thought then that if we could
maintain a stable price level and
continue certain other
supposedlypolicies,' which our
government was thought to be
pursuing, we could escaoe a S2condary and severe postwar reac¬
soon
taught
the
foolishness of those notions. To^ay
Ze areJeei"Smade;
essentially
similar
- The *
assumptions
impor¬
tance of a stable price level is
thTiltemovsubst:,:,t;ally as in
But this is not all.
Today there
may
be obtained from such of the following
as dealers in this State:
qualified to act
Stone & Webster and
enlightened
were
$12 peWSHare
They
bill and in other widespread
We
Share)
wars,
current
tion
per
:::
being revealed by the sponsors of
this
offer to buy any of
Common Stock
to some degree
consequences.
the late 1920's
an
believe
economic adjustments
severe
solicitation of
Tennessee Gas and Transmission Company
in economic history,5
assumption, even if
most
cuted.
nor a
sup¬
posedly-appropriate measures, can
effect a smooth transition to a
peace economy
and enable the'
country to escape a severe; post¬
war
reaction.
Many economists
doubt that there is any basis in
for
offer to sell
812,100 Shares
involved, the central government,
Jf
an
The offering is pnade only by the Prospectus.
these securities.
Biyth & Co., Inc.
,
1
The First Boston Corporation
Union Securities Corporation
W. C. Langley & Co.
Central Republic Company
(Incorporated)
January 16, 1946.
White, Weld & Co.
I
Incorporated
"
V.
"
'
1
•
"*
.
.
'
-,
Mellon Securities Corporation
Paine, Webber, Jackson & Curtis
Bosworth, Chanute, Loughridge & Co.
The
Securities Salesman's Corner
Night Calls
There
—
(if
made during the evening
effective than many
that is far more
handled properly)
.
interviews
Joins
AA-vA specifically for it.
*
*
*
The House Committee's Employ¬
ment-? roduction
bill wisely
and had serious efforts been made
throws
enforce
would
it, the probable effect
have
been
to
discourage
Russell Maloney, Commissioner
of Securities of the State of Mis¬
.
out
the
Slayton & Co.
.
employment"
simply cannot be assured in a free
society. Had that bill become law,
to
Commissioner of Mo.*
j^retenaed or attempted to provide
for something witnout providing
"Continuing' full
They Pay Off.
something about a,, call
Is
e^eraiiy-con¬
« r
^
trolled peacetime economy,
JOHN DUTTON-
;By
Maloney, Former Sees.
uFull"Employment Bills
(Continued from page 261)
,.ers
Thursday, January 17, 1946
FINANCIAL CHRONICLE
THE COMMERCIAL &
262
program
for
souri
a
since .1934,
has announced
his resignation from that office to
"National
Budget", and provides,
instead, for an Economic Report
by
the
President
to
Congress
within 60 days after the beginning
of each regular session of Con¬
oecoinc
XlCcto-
>
'
,
;
urer
During the busy day, most people have too
and Dirather than encourage private en¬
rector
of
many things on their minds.
They find it difficulty to concentrate
terprise and to decrease rather
upon what you have to say to them, if their mind is cluttered up
Slayton & Co.
than
increase
non-government
with the many details of attending to the average business, or pro¬
Inc., effective
employment. The Federal govern¬ gress, commencing with the year Jan.
21, 1946.
fession; under today's trying conditions.
.
ment would have assumed an ex¬
1947, on conditions affecting em¬
When a man gets home, he begins to relax.
Mr. Maloney,
By the time he has
plicit responsibility for "full" em¬ ployment in the United States. He
had his dinner he starts to fcalm down a bit.
Sometimes he gets in
during the 12
ployment in this country.
Pre¬ is to make recommendations for
that slipper and old coat mood, pulls out the pipe and for the first
years he serv¬
sumably, the best Administration legislation, but he is not called
ed as Missouri
time in a busy day really has time to think about such things as his
would have been the one that upon to forecast, as provided for
Secui! ties
own comfort.
The strain is off (providing the wile ctoesn t nam nm
would
emply the most people. in H. R. 2202. Under the provi¬ Commission¬
out to a movie, or the kids don't upset his peace and quiet with the
cluring daytime hours.
radio).
■
by proposing
a
fact that you
are too busy at your own desk to get out to see your customers these
days as often as you desire; and possibly your prospect is also too
busy to do justice to the subject you wish to talk over with him.
Either get him, out to dinner, see him at your club, or meet him at
his own home.
But watch out here because many a man doesn't want
his wife to know that he is buying securities/ The same holds true of
wives.
For this reason, it's always a good idea to suggest a dinner,
or a meeting at some other suitable place as an alternative.'
Then use the telephone—use it after dinner hours between eight
and nine P.M.
It's best to talk to old customers and old acquaint¬
ances.
Much business can be transacted with clients during evening
hours by calling them from your own home.:It's a great time saver
and an excellent way to keep contacts alive.
Use the same technique
here.
You are busy at the office—you want to keep them advised
regardless of the fact that you have to call them at home. A Be care¬
ful here to find out if they have a guest at their home or are going
satisfactory interview has been arranged
night call and making an appointment.
Stress the
Many a
out for the
evening.
If such is the case,
Tell them you will call
bore.
morrow.
■
.
v.
have
would
which
,
enabled
the
President, with the cooperation of
the Nation¬
al
Association
Securities
Commission¬
of
ers
ted
for
held
and
various
offi¬
ces,
including
the
office
of
Russell Maloney
President in
i940-1941. He was Host Commis¬
conventions of the Na¬
tional Association in Kansas City
in 1938 and in St. Louis in 1944.
•
sioner for
producing this; bill, the
should give them his
President
( A native of Quincy, III:, Mr. Ma¬
majority in Congress, tdA do everlasting thanks.
The bill provides for programs loney has resided in Missouri for
practically anything he pleased.
In addition, it contained various of Federal public works and loans, the past 43 years, having moved,
broad and vague provisions under and for encouragement of state to Kansas City in 1910 where he
which those responsible for the and local works under conditions received his LL.B. degree front |
the law school of the University
proposed policies would have at¬ of sound fiscal policies for both
tempted almost anything in the Federal and state governments. It pf Kansas City in 1925. He is &
a
»
V
call should be kept for
16 inch gun
sure he will
A■
-I:
....
active
in
..
something special—make it exclusive—it's a salesman's
to be fired when he needs ACTION and wants to make
get it.
national
and
A
.
>
time to call clients
do so. '.The night
totalitarianism
-
er, was
'
.
Although the bill undoubtedly
misled many people by
its re¬
peated expressions of an aim to escape thd awkward and danger¬
encourage and to utilize private ous position in which H. R. 2202
enterprise in carrying out the pro¬ would have placed him and per¬
posed program, these people ap¬ haps avoid leading the country in¬
parently did not notice that escape to ah unfortunate situation. Rather
clauses were invariably provided than criticize the House Commit¬
you have something
about new issues that are
night—unless requested to
led to huge
spending, huge bureauc¬
and patronage, and, finally,
bankruptcy.
during evening hours is when
special to tell them. • It's a good time to call
pending—situations that you hope to get
into—prepare them for action. We all like to think that we are im¬
portant. It makes us all feel good to know that someone thinks
enough of our business and our friendship, to call up after; business
hours to tell us about something that may be of special benefit to us.
MAKE IT IMPORTANT. What a' lot of good selling psychology is
packed into that little admonition. . If it's important to you—if it
really means something—then nqake it important to your clients.
You can do it by night calls, either in person or on the phone, mm
But don't over*do it. Don's make a habit of calling and calling at
Another good
plish anything that Ji.e could pos¬
sibly accomplish
in behalf v of
prosperity and emloyment under
a government that really intends
to avoid the road to totalitarian¬
ism
At the same time he can
to
them on the
.
sions of this section he can accom¬
Federal
racy
Do this at the beginning of your conversation.
bring your conversation to a pleasant and quick
Never be a
ending.
This could easily have
of instituting
managed economy.
a
hi ember
Federallyf provides
of the Kansas
City and'
further and /definitely
Missouri j Bar Associations > and^
encouragement of private
served as assistant prosecuting at¬
| In short, the basic question pre¬ enterprise.
AAAAA- A vAA';'
torney in Kansas City for two-'
sented to the people of the United
It provides for a council of three
(years prior to his appointment asStates by H. R. 2202 was whether
economic advisers to the President
State' Commissioner of Securities^
their thinking and activities were
on matters dealt with in the bill.
!
to continue ' in the direction of
Slaytori & Co., a Missouri cor-;
These men are supposed to be
preserving and enlarging the free¬ exceptionally qualified by train¬ boration, founded in 1930 by Hil^v
ton H. Slayton, President, is a na-:
dom of the individual or whether
ing, experience; and attainments
they were to follow those of So- to analyze and interpret economic tional retail investment organiza-'
c i a 1 i s t-Communist-Authoritarian
Ubtr specializing in mutual invest-,
developments, to appraise pro¬
iment funds A In addition to the*
Europe.
r,
. '
'
grams and activities of the gov¬
Fortunately, ; the majority' of ernment, and to recommend na¬ home office, ideated in St. Louis,:
the firm operates offices in Kan-|a
the House Committee on Expen¬
tional economic policies as they
sas City, Chicago, Detroit, Toledo,
ditures of Executive Departments
have a bearing upon increasing or
Indianapolis, Nashville, Los An¬
recognized these things and pro¬
decreasing production and em¬
duced a" bill that reflects the sober
geles and other cities. To supple-;
ployment under our system of pri¬
ment
the company's pwh hesearclv \
judgment of responsible people vate
competitive enterprise.
department,
the firm employs the
iwho really 'understand and believe A Provision is also made? for a
services
of
nationally
knowi>
in the virtues and desirability of
Joint Committee of Congress on economists.
A
the enterprise system which, in a
ithe; Economic Report to be com*
:
Mr. Slayton, in announcing the
relatively short time, has raised
the
standard of living
in this posed of fifteen members from election of Mr. Maloney as Treasf
each House, reflecting the relative
urer arid Director / Of Slayton ;
country beyond that of any other
strength of the majority and mi¬
in the world.
Co., said: ;AMri Malbney will be' of V;
nority
parties.
This
Committee
is
V;
* ' * >
inestimable benefit to both Slay-;
to study ? the matters relating to
Just a few observations regard¬
ton & Co.'s investors and' repre-*
the Economic Report and to make
sentatives. His long years of ex¬
ing the bill S. 380 as passed by the
recommendations to both Houses
Senate before we summarize the
perience as a successful securities
of Congress not later than Mayy 1
chief features of the new House
administrator well qualify him for
of each year.
bill: Fundamentally, it contained
the position he has accepted with'
One
minority, group Aof the
two basically conflicting policies,
our company. We feel gratified in;
House
Committee on Executive
if one can read any meaning at
securing the; services pf such. an.
Expenditures thought; that; this
all into the sentences which car¬
able executive."
''f ; ;**"
A
bill was really unnecessary and
ried so many qualifying, nulli¬
would involve a further wasting
fying, and contradictory words.
of the taxpayers' money—about New York Stock .Exchange
On the
one hand,. it
embodied
$445,000 per year—since, so they
the
principle of compensatory
Weekly Firm Changes..
)
contended,
practicallyf all
the
spending and deficit financing. On
The New York Stock Exchange
things which the bill authorizes
the other, it seemed to require a
has
announced
the
following
could be accomplished now with¬
balanced budget.
..
'
firm changes:
"V
out any further legislation. There
If the theory of compensatory
v The
transfer" of the Exchange
probably is much to be said for
spending is to be pursued, there
this view, and it may:: turn out membership of John B; Brooks,
is no place in such a program for
to be the correct, one. Neverthe¬ Jr., to James L. Atherton will be
a
balanced-budget
policy ' that
less, the new bill has the virtue considered on Jan. 24. Mr. Ather¬
must be carried out at some speci¬
of providing a specific machinery
fied time.
This bill called for. a
ton will continue as a partner in
devoted to a central worthy pur¬
balanced budget beginning with
J. H. Brooks & Co.,
A „ A ■
pose. It points up the problem of
the fiscal year 1948, but "without
unemployment sharply, and un¬
Privilege of Joseph A. Esposito
interfering with the goal of full
der it the
Federal government to act as alternate On the floor of
employment" — whatever that
may
be able to produce some
the Exchange for Paul S. Zuckqualification may mean! .j, > •
r.
genuinely good results. / s
The statement of purposes and
erman of Paul S. Zuckerman &
In any event, there appears to
the long title both continued a
Co. was withdrawn Jan. 10.
A
be little probability of harm in
large number of politico-economic
Privilege of A. Brendan Cooke
incantations
substantially as in this new bill, aside from the pos¬
way
for the
,
,
r
<
.
Allen DuBois Now
Wen. G. Orion, Jr., Now
Parlner in Wertheim
At Bendix^ Luitweiler
Allen
mitted
to
heim &
DuBois
C.
partnership
York
members of the New
Exchange
Stock
leading
in
Co., 120 Broadway, New
York City,
and
other
change, announce that William C.
Orton, Jr., formerly with George
R. Cooley & Co., Inc., has* become
associated with them as manager
Exchanges. Mr. Du Bois
of
has been with the firm for some
time
as
manager
.
T
their
ment.
of the syndicate
and dealer departments.
:
& Co., 52
Wall Street, New York City, mem¬
Wert¬
bers of the New York Stock; Ex¬
Luitweiler
Bendix,
has been ad¬
G.
A.
Unlisted
Stock
Prior thereto he
Saxton
&
Co.
Depart¬
with
was
and
was
A partner in Wm. C. Orton & Co.
Hytron Radio & Electronics Corp.
Common Stock
a
■
.
.
..
•
Prospectus
on
request
Herrick,Waddell & Co., Inc.
55 LIBERTY
STREET, NEW YORK 5, N. Y.
v
Over-the-CoiiniCr Quotation Services
■
For 32
Years:;:\::AS:iA'S
H. R. 2202.
For example,
stated that one of
fhe
bill
was
to
tbe
the title
of
purposes
assure
continuing
full
production.
Nobody could
possibly define full production or
know
when
it
existed.
The
re¬
mainder of the bill differed little
from H.
R.
2202.
The revisions seemed to reveal
NATIONAL QUOTATION
BUREAU, Inc.
Established 1913
48 Front Street, New York 4, N.
Chicago
Y.
San Francisco
a
fear
of
some
of
the
dangers
mentioned here and at the same
time a greater fear that never¬
theless an attempt should be made
to enact something called a "full
employment bill." In general, it
of. further waste of the
taxpayers' money, and there is the
sibility
possibilty—perhaps a considerable
probability — that 4 surprisingly
good benefits may flow from the
efforts which may be made under
its authority.
It reveals an in¬
finitely higher order of economic
statesmanship than that involved
in the other bills under considera¬
tion, and the country is fortunate
indeed that such a bill was pro¬
duced
in
dangers
the
that
H. R. 2202 and
light of the great
were
S. 380.
inherent
in
to act as alternate
for Herbert
Sierck of Sierck &
withdrawn
Jan-.
on
firm will dissolve on
Arthur
G.
Moore
and the
14,
that
of
date.'j ,A "
Erickson
Perkins & Co. died on Jan.
of
Interest
Nichols
ceased
in
on
,
the
late
Spencer Trask
Jan.
9
and on
8.
Acosta
& Co,
Jan. 10
the Estate of Mr. Nichols was
mitted
to
the firm.
limited
W;
Cooke will be
ad¬
partnership in
AA-AAAAA'AA^A 'A-A'.Av
Volume 163
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4456
263
establishment
Will Great Eritain Adopt a
•
should
U gram. Representatives of the Britfar from .nappy about! ish Federation attended a conferregional and bilateral {ence. im Puesseldorf
with .the
41 was
even
'
giving
pacts."
A
up
Reichsgruppe Industrie MarcA 15
multilateral trade
system is
advoeacea not only for the United
States and England but for all the!
and ,16,
went
on
1939, These.conversations
with the full, knowledge
the reward in
abundance of con¬
reap
the
greater
sumable products and services.
in the form of loans or
ble, in dealing with her
mists.
international
trade.
currency
This
v"'A
trade
proposed
m?tates
at
The
1946
the
conference has been
for England and the
some time during
commercial
two
policies of
nations are to
be
trade
re¬
policies, which she
;has adopted during the past dec-1
or
more, are to be discussed.
t0 f°recast the probable
other "bilateral
and
arrangements
with certain countries. We should
bear in mind that of her own
report
to
Parliament
chose a
controlled
with tariff restrictions in
she
'
•
vo-
the basis of the
on
1962. She did
this only in part
on
Ift+Tvr#t .?f the .world depression
f
um?he
Macmillan Re¬
The
♦
port states:
difficulties which
have faced
tent
not
were
to
were
peculiar to
and
large
a
ex-
our own country
to
common
the
world at
large. Up to 1929 we suf¬
fered from
trade depression in
many of our great industries ac¬
companied by a more or less
steady figure of one million un-
S52
Other
a time when some
countries were
enjoying
a
clegree
Her
had
own
beem
°t prospereconomic position
growing
worse
during
f^fnweS]^Sman aftermath of
Pi*World War and increased
international
thP
competition, coupled
with
an
apparent inability to ra-
Iw +ue
they
own industries so
that
world
could
operate
on
a
competitive, basis/
Question
twde
conference
of
multi-
comes up at a trade
in
1946, we shall find
English delegates jockeying
a
monopolistic position of spePrivileges in various
avenue of a
irf
J
restricted
on which she • em-
f 5.Oad.
i93•; This program
"for no turn
has
tb
the
•
i
li° ^at ? .fo"owing both
of
value
Key
all
the
of
cur¬
trading nations. It
is assumed that if the Dollar and
the Pound
anchored to each
were
other, the other countries would
gradually fall in line by adapt¬
ing their currencies to this ar¬
rangement, which would result in
a general
convertibility of all cur¬
rencies and in this way multi¬
lateral trade
would be
fostered.
England Wants Free Hand
of
the
this
final
sible.
es¬
of
International
From
the
entire
the
Bretton
proposals,
that England
among
aside now without
difficulty6
Previous Record
evei
their
,
trade
brought under
recalled that
privileges
>
are
pressure. It will be
they' signed
a
'trade
agreement with the United States
1938
Thfc
iy68. This
S/S known
ir° the HUI1
in
the plan
Anglois
as
io?oriTC4.an Agreement of Nov. 17
ztfSf
* J was suPP°sed to liberalIze and
promote the trade of the
two
countries.
But
the English
immediately afterwards
develop \ further their cartels
continued
•
With
:^tcla
other
trade arrangements
countries.
As
an
ample, British industries had
ex¬
duties
customs
,
An American citizen may
of the
opinion that
our
also be
tariffs
are
too
high; that they do offer ob¬
struction to foreign trade in gen¬
eral, but he still might wish to
consider
fact
the
that
England,
herself has had fairly high pro¬
tective duties since 1932!
consent to the International Mone¬
trade
kinds.
ous
restrictions
The
of
blocked
balances
have
desirable.
vari¬
an example,
India delegates at the Bretton Woods conference petitioned
the
for
privilege of using
India's London
for the
bank
balances
a
The
request
denied them because
Status
was
sterling
area
regulations
would have been involved.- From
•
Hong
come
s
Kong; the
news
that
is
trade
in
has
almost
main
that
:
South
that
as
an
aid
in
the
of
the
Pound
of
the
Dollar?
fall
in
How much would
international
value
it
if .its
discontinued? How
be required of
the United States if the Pound is
to be anchored to the Dollar for
ah indefinite future period? An
attempt to answer these questions
at the present time would be mere
guesswork. When the Pound is
set free, its value will be reflected
in the rate of exchange. A nation
gets a rating in this way which is
pegging
much
were
credit
will
tantamount to
re-
out
its
upon
values
economic
a
world opinion on*
its
economic
condition.
of
exchange
is
The
rate
index
of. the
soundness of its economic
system,
an
,
'
to
meet its foreign obligations.
is
It
doubly hazardous there¬
on a program of
stabilizing the Pound when the
English, themselves
have
been
averse to such a plan. We should
fore to embark
bear in mind that there has been
fundamental
a
cleavage
between
the United States and
England on
this point. We have been talking
in terms
of
multilateral
trade
while her people have been think¬
ing largely of cartels, empire pref¬
erences, and special bilateral ar¬
rangements, I do not believe that
she can be wooed away by loangifts or other concessions from
her
own
program.
Lip-Service Only
The confusion of voices in Par¬
liament
the
when the acceptance of
loan-gift plan from the United
States
was
flects
the
under discussion, re¬
unwillingness of the
English people to forego their re¬
strictions on trade and finance, to
which they have become accus¬
tomed. They may give lip service
to the conditions of the loan-gift
because of the possibility of re¬
ceiving billions of dollars worth
of consumption goods to bolster
up temporarily their standard of
living, but once their real eco¬
nomic condition becomes increas¬
ingly evident, they will drop the
loan-gift
agreement
as
having
been accepted "under duress." The
question may even come to a head
v
at
the
trade
conference
in
This is not to
attempt to
bring charges of bad faith in ad¬
construed
an
as
The
sincerity of individ¬
being questioned, but
economic
trends
and
principles
are
being affirmed and empha¬
vance.
is
not
sized.
rV
DeSlaebler ( Brewster
to
Moseley's N. Y. Offiee
F.
S. Moseley-:
Co.; : H "Wall
Street, New York City, members
of the New York Stock
Exchange,
Eugene L. De1 y municipal
manager of the firm's Chicago of¬
that
announce
Staebler,
f
o r m e r
fice, has been appointed manager
of the
municipal .department, with
headquarters in New York: Gerald
W. Brewster, formerly
manager
Boston,
ill
named manager
municipal
has
buy securities. The offering is made
trading department in New York,
solicitation bf any offer
only by the Prospectus.
ISSUE
-I
,
The
It
is
of
rather
our
"•■'■■■'
■' ■ •"
Other
; *,
■ ■
strange,
extreme
too,
that
that
he
Price $102 Per
understands
the United States.
tectionism
is
not
appreciated
in
Along with England's desire to
Share
]>lutf accrued dividends in the case of shares delivered after their
quite readily-why the English and
other foreigners would like to sell
in the American market, which is
the most important of all the mar¬
kets of the world, but is at a loss
to comprehend how some Ameri¬
can
officials and 'others of our
citizenry can accept the argument
that only the United States is to
be blamed for fostering a high
Preferred Stock
(Without Par Value)
!*
v
tariff levels. Mr. Peek, in his
avers
-.
Company, Inc.
40,000 Shaires $3.60 Cumulative
internation¬
.found no objection to
the import duties of the United
Kingdom, " but haye constantly
raised serious objections to our
book
J..If U-y vv,.
Side
alists have
own
VV- .'MifCpi!"£>,*.■ .v.;v... v..■. ...
Brown Shoe
has been the same for more than
decade.
-
date of issue
A copy of the Prospectus may be obtained within any State from such
Ifnderwriters as may regularly distribute the Prospectus within such
-.v
•
•;
•••',.
.
\
vp •
,A i "J t: *(
*'■ * ,L''
1
s •'
'"{•••>
'"4? *'■ -'i' •"
'
} 'n
■'P-ft'to'' •'
Goldman; Sachls & Co.
' •'
'■"■W* '■
been
of the municipal
.
for England and the United States
the
of this year.
course
be
.
NEW
in
the form of goods and services to
This announcement is neither an offer to sell nor a
.
ex¬
ability
What is the Pound
lis.
actually;worth.today in terms of
just
at
ending 1932, the duties collected;
which are obtainable elsewhere
by the United Kingdom over the;
in this sterling area;
entirety of her imports for the
Concerning England's privilege
s£me period amounted to 17.4%.
of making alterations in her rate
This seems to indicate that the
of foreign exchange, specifically
tariff systems of the two nations!
to change the international rela¬
have for 'belter than a decade been
tionship. of the Pound to other
operating on the same level.
the following com¬
We.are all aware that English currencies,
ments may be made: It has been
lecturers
in the
United States
assumed by many in the United
have been severely condemning
States
many
send
to
ex¬
gifts, but
long term rate of
depends
change
free
a
be remedied by credit
can
nation's
uals
The question of the value of the
Pound, is an intriguing
one to
breach in
a
did not
nation's currency.
purchase of goods in the
United " Stales!
the
part
a
delegates
(the agreement ante¬
dating the final Bretton Woods
proposals jj until after it was made
the duty of the Fund, as Lord
Keynes expressed it, to approve
changes in the external value of
fre¬
quently attacked. As
of
Her
tary Fund
London
been
The late Mr. George ,N. Peek, |
China port which is controlled by
his; book entitled, "Why Quit i
Own," points out that while England. The chief reason given
is that Hong - Kong is in the ster¬
American imports paid duties av¬
ling area and exchange restric¬
eraging 17.9% for the fiscal year,
tions limit imports to essentials
Industries wished to assist in
the
of
value
foreign exchange. This
she wishes to be free
currency whenever internal eco¬
nomic conditions make this seem
:
to which England has shifted her
position from free trade to pro¬
ex¬
important to her
to alter the external value of her
Our
that their duties were not inter¬
fering with foreign ;trade» They
have cultivated the thought that
England
was
virtually ;; a free
trade nation—as indeed she had
been for nearly a century preced¬
ing 1932,—without admitting that
the general level of import duties
more
external
in
direct
.
in
us on account of our high tariffs
while assuming at the same time
the
Pound
sterling
area
mentioned
as the con¬
trolling element, would be just as
inimical to the development of a
system of multilateral trade as
standstill
a number of cartel ar¬
rangements with continental pro¬
ducers. The Federation of British
pro-
than
above, with England
,
number of
means, that
the
tariff. This shows that the extent
tending and perfecting this
The
a
that her internal cost price
structure is
The English are accustomed to
magnify our tariff system beyond
measure, withdut considering the
level of their own customs duties.
She has claimed for
Trade
;
bank
en¬
tered into
year
in the recent "Washington
loan-gift negotiations. They refer
to' this as a "UrematUre restora¬
tion of the convertibility of ster¬
ling."
might cramp her style in handling
the problems of her economy as
they come, up from time to time.
Sterling Area Threat to Free
the
of
any
United States.
some
Past events may throw
.light on
the attitude of the
English when-
of
tem
more than she is willing to
tie it to gold. She fears that this
because this transition period has
apparently been reduced / to one
years
change
Woods
,
.
variations in the rate of
discussion
the former customers of. the "Gerri
it seems clear to me
man
cartel, the I. G. Farbenin- Monetary / Fund./ Parenthetically,;
herself is not interested in anchor¬
dustrie;
These - examples
are it should be added that the Eng¬
brought up to indicate the strong lish-are- complaining at present ing her currency to the Dollar
a
to
after
years
tablishment
.
m
the
.
.
combine will aim at! of five,
new
tendency toward cartelization in
such a conference, it English industry.
appropriate to consider
some of the
U. S. Tariff System Magnified
changes that have'
taken place j|n. the
economy of ; Concerning the relation of the;
England through tariff legislation level of customs duties of the
and
through special agreements United States to
English trade re¬
which she made with other coun¬
strictions in general, it is rurribred
tries.
that the English loan negotiators
have intimated that if our repre¬
UK Chose Controlled Economy
sentatives at the proposed trade
Even if the United Kingdom is
conference will press for the re¬
gi anted a loan-gift she will find
nunciation
of
England's cartel
it extremely difficult to
modify system, her
delegates will try to
her
protective
tariffs,
empire offset these trade restrictions on
trade
preferences, cartel systems their part by attacking the sys¬
v,
of
rencies
cumulated
Jj
v
for
It has been called the
zation
.
would be
he
some
,
ade
we
leading bankers
distinguished econo¬
our
by members of this
indicated that while the United, bloc.
(2) The provision of the "/Questions have been raised as
to the feasibility of such a plan
Woods Agreement per¬
States is a competitor in the same! Bretton
and particularly whether England
field, the British backers of the mitting" England and other mem-;
would care to have such an ar¬
new cartel are determined to cap" ber, countries to change the value
ture the .market It is intimated; of their Currencies for a\ period; rangement made, if it were pos¬
the' that the
on
agenda. Specifically, England's
stricted
the .British are forming a,
cartel for the sale of drugs. It. is
of
some
Country Approach to the stabili¬
may
indirect though very
method
of influencing
an
London monopolize and distribute
the .dollar credits which are ac¬
reporting
the newspapers are
ability to pay for its im¬
with exports. Short time
a
in
that
its
ports
of
be called'
ent
of
and
.
would
Dollar
should also consider her program
to retain ; a free hand, if possi¬
and approval of ,"His Majesty's!1
effective
trading countries, because it Government." International politi-j
cal tension prevented these .talks; the flow of goods and services
gives free piay to the principle of'
division of labor or specialization,! from resulting in a definite agree-! among nations. The most impor¬
ment. But we may be sure that tant of these are: (1) Her develop¬
If goods and services are allowed
ment of a sterling area out
ofto flow freely from
place to place they were not held for the pur¬
which
have
come
the
blocked
and country to
country,'the pro¬ pose of rounding out the Hull pro-i bank
deposits of a number of
ductivity of the trading nations gram and making it more effee-;
,
i countries belonging to this group
would increase through the re¬ Jive.
as
well as the system of having
; We. may add that just at pres-j
sulting specialization and all of
•them
the
be
be
other
•
multilateral
and
brought into a fixed
relationship
with * each
other.
This is a special recommendation
unhampered in the application
of direct trade
restrictions, we
(Continued from first page)
•
of
the Pound
trade
■' 1 '
V-*.
of the
State.
■■
r v i-.v
Lehman Brothers
THE COMMERCIAL & FINANCIAL CHRONICLE
264
the relative
recover
Farmers' Stake in Full
Employment
Thursday, January 17, 1946
position it had
throughout our history
occupied
World
first
the
before
War—the
to the farmers of the ment, labor and money fully co¬ relative position we call parity. 4
world after World War I. And operating for maxnnum produc¬ b Let me give you a couple of
tion in the cities, there can be no facts just to illustrate how closely
once more, looking to the future, I
the farmer depends on the pay
and the necessary action taken in say that these things do not have long-continued ' inflation in This
checks of the workers in the cities.
time. For a full year after I first to happen 'again-—but they will country.- Without this maximum
Undoubtedly
you know them well
began talking about a postwar ag¬ happen again unless we act bold¬ production nothing can prevent
—but let's pin them high for all
inflation in certain lines.
ricultural depression, prices
ly—and act in time.
For all of 1946, at least, we will to see and remember.
The immediate future can eas¬
climbed
higher and highei\ ItIn 1929 factory payrolls were
ily deceive us as to the true na¬ also need maximum production on
seemed as if my diagnosis were
the farms—for the most serious $11 billion; farm income* was $11
ture of the trend. No one knows
Wai\ arid
(Continued from page 247)' v~
tably, uniess iue
-lit the
postwar back]ick were understood
surely wrong. But in the summer
of 1920 the bubble burst.
inflation
as
in. 1919, we can
distort
our
judgments in 1946. No one
knows whether Congress will extend certain emergency price con¬
trols—temporary but essential-
learn from what
happened'to the
after June 30. No one can be cer¬
f
1
'A
/<>J
11
'
^ K
•
much
how
Can Have Another Farm*
problem
may.
Depression
Today, just
tain
of England after the Na-
farmers
as
labor
poleonic Wars, to the farmers of
to when
management mid
settle/ down
will
to
world
this" year
their
Chile
Notice to Holders of Dollar Bonds of the
Republic
Chile, Mortgage Batik of Chile, Water Com¬
pany
of Valparaiso, City of Santiago, and
Chilean Consolidated
Municipal Loan
•
On and after
February !, 1946, in accordance with
the provisions of Law No. 5580 of January 31, 1935
as
regulated by Decree No. 1730 of M ay 17, 1938 and
Decree No. 37 of January 4, 1936 of the Republic of
Chile
(which decrees are now consolidated into
•
Decree No.
3837
of
October
issued pursuant thereto,
24,
1938)
coupons
corresponding to said payment
as
start
the
wheels
as
much
but
warm
of
industry
in
the
United
States
can¬
not, by ourselves, rescue the world
from all its troubles—but we can
by extra effort in 1946 prevent
millions, of
and
unnecessary
the bloodshed
avoid
deaths
of
un¬
necessary social strife. We have
already made progress in estab¬
lishing the international machin¬
of bonds which have been
for cancellation of the
said payment
■
be
coupons
In the
dollar wheat
blew
away.
Then
prices fell—and both the land and
the farmer
Today
built by
.
You
set forth
against
coupons
the Plan
war
A
more
or
detailed
Santiago.. "and the Consolidated. -Municipal Loan
copies pf the" Prospectus, may be obtained at the office
of said correspondent.
When
requesting letters of transmittal, kindly indicate
whether the letter of transmittal is
to be
used in
connec¬
tion with the
presentation for payment of coupons which,
have already been stamped, or in connection with the
presentation of bonds 'and coupons which have not
been
/
L
so
stamped.
In the latter
kindly indicate
whetheryor not the: letter of transmittal is to he used
iii tendering bonds of the City of Santiago or the
Consolidated Municipal Loan.
-A
-W';'.
CAJA AUTONOIWA
■
case,
:
DE AMORTIZACION
DE
LA
DEUDA
FUBL1CA
(Autonomous Institute for the Amortization of the Public Debt)
ALFONSO FERNANDEZ/
Manager.
You
Land."
He would
today-—be¬
thousands
speak for the land.
today there
voices
to
are
of Triple-A- speak the
voice of the land. And as long as
men
the good land has such spokesmen
the heritage of our children shall
not be
one
ALBERTO CABERO,
X/' X.X I:President:
paralleling
the
generally. If the workers
to spend,
product at
The
market for his
a
farms
about twice as many
are
girls
and
growing
on
up
will; be needed
as
duce our future farm
in
the
money to spend for a
basket when he has a
of
to pro¬
product re¬
city
has
full market
said
"When
recently:
Secretary of Agriculture that
farm
could not be
wholly solved on the farm. Too
much
depends
upon
what the
businessmen and workers do! in
the
problem
and
cities
the
market
farmers*
The
towns.
is
the
market
basket of the workers in the cities,
'
';"
,r
-
.V'v
-
A
Prosper
Farmers
Only When the
Nation Prospers
Farmers
in
this
country
have
prospered except when the
country as a whole was busy and
the workers had. pay checks to
never
ipend at the corner grocery store.
But
in
the
last
25
years
that agri?
culture depends on general pros¬
perity, but also that it is possible
?or
agriculture
to
remain de¬
pressed even when the rest of the
country is in good shape. This
happened in the Twenties, as you
well remember. Throughout the
boom
of
the
crash
of
the
farmer
was
Twenties
and
the
Thirties, the
stepchild of the
early
the
economy.
Not
until
a
consistent/coordinated and cour¬
ageous program was worked out
hv
a
sive
to
the
all
reasons
* *,
farm
why
people should take leadership in
demanding action for full employ¬
ment, this is the most Important—
their responsibility; toward their
children.
How Do We
Get Full Employment
Opportunity and Freedom?
There
-
voices of reaction that
are
say
it is impossible for a free
people to provide and maintain,
for each other, a condition of full
employment opportunity without
losing their cherished freedom.
counsel
This
defeat
of
comes
fight
people as a whole to better their
lot. They say that any kind of
planning means regimentation —
except, of course, their own plan¬
ned economy of scarcity.
They say it is impossible for
free citizens to get together and
act jointly for common objectives;
Well, you men of Triple-A know
means to me.
chance to
a
decent liv¬
earn a
work and earn. Also that I said a
decent living.
Why is full employment so vita1
the
to
interests
the
of
farmer?
Well, in the first place, it means
the
worker's
basket.
well-filled
But there
nection here not
market
is another
too
con¬
generally un¬
tematic effort on the part of the
better. You know what we can ac¬
complish by d^ibdcratic jplupning,
you also know from your
experiences the methods of
And
opportun¬
ity? Why won't it be a good thing
to have, say four or five million
unemployed so as to keep wages
down and
labor
efficiency up:
This seems to be what a sizable
crowd of lip-servants to progress
own
full employment
really hanker for. They; actually
feel
to
seem
when there is
more
a
comfortable
line of job seek¬
at the factory gate.
ers
right, let's look at this prop¬
a little more closely.
If this condition were chronic—
if
several million"
able
people, willing
work
to
and
seeking
work, couldn't find decent jobs,
they would return eventually, to
small
the
where
and
towns
man
a
sometimes,
can
farms
less—
the
exist
on
experience
as
has
shown, on less than nothing. You
know what that means. You saw
it in the Thirties when the farms
in effect; the national poor
bouse—The last refuge of friends
were,
cousins for
and
whom; the cities
hope and no haven. Then
given such a situation,; down go
wages. And down go- farm
prices. And down, too, goes the
farm market for automobiles and
held
no
farm
plows and tractors. And up goes
the line of
unemployment; in the
cities-—higher and higher. And
away the whole Nation goes—hell
bent for economic chaos again.
But the farmer's interest in the
condition
is not
terest
we
call full employment
simply his commercial in¬
is
also
concerned
and
I
responsible as_an in¬
dependent citizen — traditionally
the ■ most
independent
in our
whole society, the most conscious
think deeply
of
the
real
pricelessness of per¬
the most jealous of
sonal freedom,
any
restriction on that freedom by
either
ment.
the little men of little faith who
fear the, democratic process.
them
private or public encroach¬
The core of independent
in the United States
the independent farming
citizenship
of their free¬
You
what they areenemies of freedom and of oppor¬
know
for
'.
tunity.
These enemies of the democra¬
tic process also have
of attack. They say
another line
the job of
providing and maintaining full
employment opportunity is just
big.
Well, it is too big for private
groups or interest. Business can¬
not always assure the opportuni¬
ties we need;
the wiser heads
among our business leaders know
this; they realize that there are
factors involved that are quite be¬
yond the control Of business. La¬
bor cannot do it.; Agriculture can¬
too
industrial
not do it in this modern
age when more than 80% of us
must find pur opportunities some¬
where away from/the; land;
; ;
It is truly
together.
How do
a
we
job for all of
us
act together—all of
us? Just the way we
acted when the.need
have always
We act
arose.
through our private organizations
of many kinds. We mobilize our
governments and our county
governments. And for the things
local
be done on
that must
a
national
mobilize our
Federal
Government This is what we do,
scale*
we
always have done when the
and
need
for. action
arises
tional scale.
cise
our,
Do
we
a
na¬
sacrifice
our
on
Certainly not. We
freedom?
businessman.
as a
any
progressive movement — any sys¬
the farmer
derstood. Why should
administration respon¬ is still
the need did agriculture population—worthy
new
decent
a
ing. Notice that I said able and
willing to work. Also that I said
we
have learned not only
ployment opportunity.
we
em¬
has
and
the
find
and factories and of¬
front those who always
perity
can
not
be
maintained
apart and independent of the na¬
as
and
oppor¬
decent living?
It is sim¬
ply a condition where everybody
who is able and willing to work
ployment
osition
took the job of being Secretary of
Commerce was because I learned
•
around
scout
job at useful work.
a
and
perous."
All
prosperity.
earn
schools—-provided
maintain the condition of full
Of
neighbor
to
and garages
inclined to think too much about
they have to pay-—and
these extra boys and
to find their
In the towns and cities—in stores
fices
the wages
■
are
girls going
job at good
wages. I use the phrase, fat good
wages," deliberately. Farmers are
despoilation.
One of the chief reasons why I
Where
tunities
good price.
a
worker
Soil-building is the firm founupon which
agricultural
prosperity is built. But farm pros¬
American
Santiago, Chile, January 15,.1946 ■'
of
these things
say
cause
City
.
income
farmer has
the
da tion
of dollar bonds of the
fact
in the cities have money
want
'The Voiceless
not
coupons
case
stress
have drawn
we
tional
transmittal, and in the
the
under
My grandfather used to make
a speech on the subject of
in order to receive
presently announced payment at the rate of $12.02
per $1,000 bond, and presentation of bonds with apptirtenant coupons for
stamping, should be made at the
office of the correspondent of the
undersigned in New
York City, Schroder Trust
Company, Trust Depart¬
ment, 48 Wall Street, New York 5, N. Y., together
with an
appropriate letter of transmittal. Letters of
of
But
many
the
.
the miracle of soil-build¬
mands of 1946;
notice concerning the presently
will be furnished with form letters
stamped
townships.,
ity^ the first'big taskToFTripleA after
meeting the heavy de¬
of transmittal.
Presentation of
with you
work
Therestoratioh' of this soil fertil¬
before December 31, 3946.
announced payment
of Triple-A and
heavily upon
the bank account of soil fertility
which we built up in the Thirties.
of bonds of the above issues which have
on
you men
saw
Forties.
of
Plan, said payment will he made
presentation of the bonds with all unpaid
attached for stamping to evidence their assent
basic
That is what the term full em¬
bulwark
ing in the Thirties make possible
the abundant production of the
so
the
the
is
the farmers who
«
to
farm
in
defenseless.
were
there
in the counties and the
under the Plan and the bonds need'not
case
assented
this
II
War
And what makes "good wages?"
like the Triple-A through which
Of course it is simply a condition
they could rebuild their soil. The
where a man doesn't have to take
hillsides that had been put into"
starvation wages. And the reason
dollar-and-a-half
corn
eroded.
Much of the Great Plains acreage why he doesn't have to take star¬
vation wages is because he can
which had been ploughed for two-
corresponding to
presented.
not
to
two
World
has been demonstrated by the rise
wages are high my farm is pros¬
stamped on
or after October 24, 1938, the
presently announced pay¬
ment will be made
against presentation and surrender
•
during the years of recovery. L
Even during the strenuous days
of
After World War I, the farmers
of this country had no mechanism
will be made only in respect of
stamped with appropriate legend
to indicate that they have assented-to the- provisions of
the. aforesaid Law and Decrees'(hereinafter referred to
'mm
as the
'Thin").
case
They rose together
not enough about the wages paid
to
their customers; As an" old
The above, payment
bonds which have been
Jn the
also $5 billion.
which will make it possible
to expand the movement of civil¬
ian goods abroad.
in letter of transmittal.
.
There
the farm.
of the above Ipans will be entitled to a payment
the rate of $12.02 per $1,000 bond against pres¬
entation and surrender for cancellation of the two
.
boys
Workers
any
at
$5 billion; farm, income was
were
employment, I would say,
his interest as a family man.
rise in the earnings of industrial
to
and decrees
holders of assented bonds of
payrolls
full
only to keep themselves
about half
on
ery
of
factory
of
in
is
employment
economy
abundant opportunity.
The farmer's final interest
/
living
We
of
1932
In
in a
system. This they can do only
full
food per capita as we consume in
the United States. In
Europe they
do not have the
energy to mine
sufficient quantities of coal not
turning again;
Republic
billion.
own" free
quirements. The good land
is
mostly
occupied. > New ' power
equipment;Lmore; ! electrification,:
and better farming methods mean
more production and more income
per acre—but they also mean that
fewer workers will be needed on
now
peacetime job. But with manage-
the United- States after the Civil
the
is the scarcity of food. More than
half the people of the world are
.
v
in
protect it through
government. The
independent farmer and the inde¬
pendent businessmen must remain
the seedbed of our free enterprise
dom and able to
their
exer¬
freedom!. We strengthen
it.
Together the free peoples of the
earth have found the strength to
crush the disciplined and regimented power.of the nations that
foreswore
their freedom.
Did
■
we
impossible to do this with¬
our individual liberties?
No; our institutions and our liber¬
find it
out
losing
ties
have'
are
intact.
been
experience.
Now
we
If
anything, they
strengthened
-
face another
by
this
1
test, an-:
fVolume
163
Number 4456
THE COMMERCIAL & FINANCIAL CHRONICLE
After what
happened to the prices of. bank eligible issues, since
way in which the Treasury fitted its
pattern of financing to meet these changed conditions, there seems
,o
be only one conclusion to draw if the recent
price advance in
>he ineligible issues keeps up. ;
.v'?,;^ \
^
w
the
ff
Our
Reporter
CHIPPENDAtEi JlL
By JOHN T.
The
•
Governments"
on
it a certain element of speculation. .*. . After the
Loan, when it was believed that there would be a change
financing pattern,"the Government bond market began an
upward trend, led by the bank eligibles, that carried prices to new
all-time highs.
That was the first appearance of a speculative
trend in the Government bond market.
More recently, at the
conclusion of the Victory
Loan, we again find a not dissimilar price
pattern in the making, paced this time by the restricted obligathe
.
.
The
tions.
other
rates
for
future
mass
the
threat
of
unemployment and
dangerous
as
the
as
are how
in conference between the Senate
and
the House.
do to avert this
cycle of danger? It is clearly a
tional problem and calls for
tional action; The first need is a
kind of mutual pledge to each
other as free citizens that we will
this
job—that
such action as will
will
we
take
contin¬
assure
ued
opportunity for everybody
able and willing to work to earn
a decent living and that in the do¬
ing we will protect and increase
our real and personal individual
freedoms.
How
do
do
we
this?
You
all
know
responsibility
rests.
for in the first place-—to do
those things which we wanted
up
and
which
individuals
or
election precinct of every
Congressional District in the coun¬
try. It is up to you..
The action for full
employment
get from Washington in
the critical years ahead will clear¬
ly reflect the kind of men and
that
women
people pick in the pri¬
send to Congress in
fall—in 1946, in
1948, and
maries
the
you
and
$|jf§
This goes not only for full em-
It goes also for pro¬
of decent health, housing
and education—for a sound, pro¬
grams
Fed¬
minimum wage and adequate pro¬
vision for the old, for the wise
a
to
an economic
charter; a state¬
ment that will express our mutual
the control and
pledge and set it forth where all
not
the world may see.
This economic charter must
it is our mutual
responsibility to
Finally, it must
pledge that in order to make good
Insure that fight.
responsibility,
Federal Government
will
our
act
in
liberties that
other when
we
guaranteed each
tion of the XJnited States.
Does that sound^revolutionary
to you ? I think it is
plain
common
And; I, know as well as I
know anything that it is the will
of the American people in their
sense.
vast
majority., To say that it is
beyond our powers is to challenge
the very foundation of free gov¬
ernment.
Then, haying laid down this resCommitment, we must"" go
olii te
ahead with
coordinated national
a
of
action.
There
is
and
measures
take
a
policies. It
systematic,
well-
thought-out program of Federal
that will direct the
Ac¬
tivities and the policies of the na¬
measures
Government
basic
ment
objective
for
and
sary
of
toward
full
employment
meet
these
national
a
bill
that
economic
charter
that would set up the neces¬
machinery
to
work
practical, coordinated
out
program
a
of
action
was
adopted by a vote of
71 to 10 in the United States Sen¬
ate as long ago as last September.
In December the House of
resented
one
way we
can
It
the
the
vote
behind
friends of progress.
is the only way we can
courage and
Washington that
get
responsibility in
as necessary
are
to win the peace as
win the
the
rejected
this
Rep¬
thoughtful
legislation and substituted some¬
thing entirely different and in¬
.
of Lobdell &
Lobdell. & Co.,
.
.
.
Pittsburgh Mgr.
.
.
1
.
Place, New York City, announce
that Donald
S. MacFadden
has
been elected a Vice-President of
the
.
PITTSBURGH, PA.—Morgan B.
highest-grade corporates.
These banks
ager of a
Pittsburgh office which
firm
is
opening in the First
National Bank Building.
&
Co;,: Inc. Prior thereto he was
the .' War
Department in
Washington, and was with Goldmam Sachs & Co.
;-•/
...
;
V;
Building, is now doing business as
a corporation.
Officers are Oscar
S. Fox, President and Treasurer,
...
is
and
that
doubt
no
interest
continue to
will
rates
.
Some of these market factors
eye
Reports
on
a
i
that the
program
Cohen, V= Simonson
.
.
change,
Dillon
Simonson to
be taken of present conditions;'regard¬
v Politically, lower carrying charges
important.
Exchange,
.
.'••
.
It is be-
Browne, who served during the
war
as
a
colonel
in
the
U.
S.
Army Air Corps, has returned to
active association with the firm.
011
Feb. 1.
EQUIPMENT
J
tended tcL
make the market very thin.
The holders of obligations that •
are in demand refuse to sell
until the limit has been reached
more money: is made- by
holding the obligations than
trading them.
»
(3 "Federal" cannot stop the uptrend because they are not in
a
position to supply the market with long-term bonds. . .
The
Central Bank's holdings of this type of security are too small to
have any appreciable effect on the large demand that is now in
liliTRUST :::|
...
.
CERTIFICATES
.
.
evidence.
Offerings Wanted
...
Immediate
(4) There are those who contend that the loaning rate to dealers
should be changed. . . . It was pointed out that this would have a
retarding effect
the market.:.
on
.
.
(7)
Weekly List
(8) No
the next issue
maturity and a
will be eligible
CAN
...
...
.
.
.
Valuation and
now
one
must be
.
.
matured issues will
come
.
the
servicing the debt.
If these
.
.
,
Complete dollar appraisal
issued each June 30 and
December 31.
-
answer as
to whether the
£'»V'* 'V
,
it is
:''
-
V
v
'''
■:V".VA-;\v'i
Monthly
or
Special
Appraisal
,
are taken care of by certificates of indebt¬
assuredly mean that the Government is inter¬
only in reducing the cost of carrying the debt.
an
^
0
:
obligations
edness it will most
ested
Appraisal
reached levels that are
constantly prepared for developments
that could affect its future course of action.
Accordingly, the
refunding of callable or maturing obligations in 1946 is being watched
very carefully because it is believed that from this "operation will
come the pattern for future financing.
;
In the type of obligation that is offered in exchange for the
or
Semi-Annual
HAPPEN
The Government bond market has
high and
upon
request.
,
financing during 1946.
A price of 105 being forecast for the 2V2S due 12/15/67/72.
new money
ANYTHING
furnished
Gladly
in some quarters is that
now
for purchase by commercial banks.
very
on
.
The option
(9)
bids
*
being felt in many localities, and these funds must he put to
work irrespective of the. level of prices.
(6) There is considerable "Street" talk about a one-year %%
issue.
firm
practically all issues.
The sharp /return flow of currency from circulation is
<5)
Treasury is shaping its program to promote stability in the mar¬
or it is still a, question of minimizing the interest cost
of
that W. Paul
announce
partnership
...
lieved by some that under present conditions this has
called
Brdad ,•,Street,
New
members of the New York Stock
Stock Ex-^
'^admit Seymour C.
»
.
ket
Co.,
16
York; City,
120
Considerable discussion centers about the daily limit of
(2)
&
*
will
.
8/32nds for fluctuations in individual bond prices*
Eastman, Dillon
Eastman,
Co.,
&
bers oMhe New York
"Federal" do not see eye
There are those who
and
of future financing.
for the debt is what is
Cohen, Simonson Partner
Broadway, New York City, mem¬
are:
Treasury
believe that advantage should
less of future consequences;'.}
.
•
io
Vice-Presi¬
Reusch,
remain
entirely on low interest rates.
.
Government bond
prices have now reached the point where "market gossip" seems
to be playing a more important role than basic fundamentals. . . ■*
longer based
to
H.
Carl
dent and Secretaryr
low, but the present trend in the Government bond market is no
(1)
CINCINNATI, OHIO—Fox,
&
Co., Dixie Terminal
Reusch
IT'S DEFINITE
There
Fox, Reusch Corporation
.
,
.
W. P. Browne Returns
was
with
are
.
President of American
Tubular Elevator Co. since 1927,
ment counselors, as resident man*
MacFadden
associated with Mellon
Securities- Corporation-and Blair
presently; looking at A, and lower-rated, cor¬
porate issues, which *s definitely an unfavorable trend as far as
the banking system is concerned.
While it is important that
increased purchasing power in the form of larger bank deposits
be retarded, it is also important that the quality of bank assets
not deteriorate too substantially.
Schiller,
has joined Cole, Hoisington & Co.*
economic consultants and invest¬
firm. :lMr.
formerly
4
of long-term obligations will- have a much longer
lower coupon rate, but a shorter period, when it
for Cole, Hoisingfon
Company
Inc., 20 Exchange
,
war.
Schiller
the
.
is still complicated, particularly those institutions that are
savings banks than commercial institutions.
The 2V2% due
Sept.- 15, 1967/72 is the only obligation that these banks can buy
that pays their expenses, unless they change their investment policy
and purchase corporate securities, which is what many of them are
doing at this time.
.
The purchase of corporate obligations has narrowed the
spread between AAA corporates and Governments to, a point
where some of the smaller institutions are no longer interested
they were to
the
requirements
alternative.
one
The problem of the commercial banks with reference to invest¬
.
■■
election year, and interest rates
Because
important politically,
many feel that this will be the course followed irrespective of thelonger-term consequences.
■; This will move up the level of the
whole market and force the commercial banks deeper into the cor¬
porate market.
.
Our
experience and facil¬
disposal.
ities at your
are so
:;
.
...
employ¬
opportunity;
full
A
would
'
us.
out
proven
no
single measure or, policy that will
do the job. It will take a whole
tional
destroy
have social and economic progress
in this country. That is by get*
created this Fed¬
we
Government by the Constitu¬
series of
our
rivers and forests. And it. goes for
use of
atomiq en¬
ergy so that it will serve us-and
ting
MacFadden Named V.P.
non-
carefully the results of the present
COMMERCIAL BANKS' PROBLEMS
and
by our authority to
do those things that may be nec¬
essary to accomplish this-^within
its powers, and with due
ar\d
proper regard for the individual
will
development of
There is only
rec¬
ognize the fight of equal oppor¬
tunity to a chance to earn a decent
living. It must acknowledge that
program
.
though it would be to the advantage of
as
acquire the outstanding restricted bonds, since it is the
opinion of money market experts that further sharp price ad-
ployment.
and beneficial
our name
.
.
you
policy adopted by our elected
representatives that will amount
mutual
in
rests
our
through
eral
eral
It
gressive tax and fiscal policy-—fof
permanent
Fair
Employment
Practices Act,
for an adequate
couldn't do
we
other forms of organization.
We need a statement of
this
final
the
Investment
.
been elected President of the Fi¬
rush to
in the
where
every
Why
our Federal Government,
of course This is what we set it
as
of this ses¬
If not, we will
after.
through
done
constructive meas¬
be gotten out
sion of Congress.
have to try again.
na¬
na¬
whether
remains to be
It
Johnston
R.
American
ments
,
adequate. The two bills
ures can
we
.
obliga¬
CALIF.—
of North
Corp. has
FRANCISCO,
.
.
more
seen
What shall
•
1
not
of war. We simply dare
risk another cycle of boom-
Government
of
threat
and-busb
i
Issues
jf
threat, And
stagnation is
do
.
seems
investors to consider
.
feeling now, as in the past, is that there will be another ;-i:
in the financing program, which will result again in
....
chronic
bank
p/jivances leave the Government with only
change
lower coupon,
;>
.
It
,
.
SAN
Douglas
k
.
Sixth War
tions.
,
As
;
,
has attached to
.
*
cf S. F. Elect Officers
2%?, it is quite likely that the Treasury will again be obliging enough nancial Statisticians of San Fran¬
to pattern its future financing to meet the needs of the markets
y
cisco, to succeed C. E. Schick of
It is quite evident that the Government cannot come
along and offer the
San
Francisco
Stock
Ex¬
long 2^2 % bonds, when comparable outstanding obligations are sell¬ change, Charles E. Fagg of' the
ing in the market to yield 2.25% or less.
Whether this trend American Trust Co. was elected
to lower coupon long-term restricted obligations
continues, depends Secretary-Treasurer of the group.
to a large extent upon the. buyers of these securities as well as
the Treasury.
.v.
•/..
the sensational price advance in Government bonds is rivaled only
by the spectacular spurt in quotations for common stocks. > i'. It has
always been quite generally conceded that the latter type of security
,
Financial Statisticians
War-.Loan, and the
long as non-bank investors scramble for the outstanding
obligations, motivated by the fear that they will not get any more
one
,
Sixth
TREASURY WILL OBLIGE
J
market in the past in which there was supposed to be
a
minimurti-of speculation was the Government bond market. "." . >
Present conditions seem to have modified this idea somewhat since
in
265
Partners Rejoin Lehman
filter War Service
Joseph A. Thomas, William S.
Glazier, John R. Fell, Frederick
L..Ehrman, and Philip Ickelheimer
have been released from
serv¬
PROGRAM SUGGESTED
A policy of offering part in bank issues, such as a lVz% due
1954/56, along with longer-term restricted obligations to non-bank
investors to provide for called and maturing obligations, would have
a stabilizing effect on Government bond prices.
To the extent
that these bonds are .sold t to non-banking institutions there would
be a reduction in deposits.-.
The cost of carrying the debt would
also be reduced by this operation. ...
,
Partners
William
Lehman
in
Street,
New
general
Brothers, 1
as
York' City,
members of the New York
Exchange.
"
'
to bring stability into the Gov¬
ernment bond market and at the same time reduce the cost of
; It would also
j •
Stock
:
be possible
the debt by refunding certificates, called
:
with
term
as
a
combination of
securities that
well
as
ani matured obligations
% % obligation, medium-term and longcould be bought by the commercial banks
a
non-bank investors.
.
.
.
.
INCORPORATED
PHILADELPHIA
.
.
ice in the Armed Forces and have
resumed their activities
,
STROUD SGDMPAHY
-
Pennypacker 7330
NEW YORK CITY
Itfcctor 2-6528-29
Ttoo
private
Philadelphia,
w'res—
New
v
York
Teletype—TULA ;206 & 29*5
I
Approve Loan to Great Britain?
Should Congress
irl "Prnm
(Continued from
nortA
page
UrttrA
^'XL trf in¬
will|not have
to nntipay +t\/v
the 2Vz%
terest every year and the princi¬
pal-loo in the event of a British
I tin'11
246)
By HON. C. WAYLAND BROOKS
give $20,000,000,000 of lease-lend
for practically nothing—and
It is presented in
A.xa
conjunction
uxivuutf
vwv4*vvw
£/*
.
default.
'
-
^
.
The British couldn't pay a four
-*•
4-»f AWOAA tuuiwu v
d AUUI
.
billion dollar debt after the last
They tell us they can't pay
which is full of evasive promises, it now. And still our negotiators
In short, we forgive $20 billion
insisted on calling it a loan and
lend-lease debt and give up a demanded that the British accept
fresh 3,750,000,000 American dol- it as such,
with
a proposed future program
of Commercial Policy Declaration
lars
and
get contracts, of future
promises full of escape clauses
and loop-holes.
Second:
I
I
ish didn't want
this loan
but
opposed to it because I am
am
confident that it will prove to be
gift and the language and form
agreement is subterfuge to
WW
of the
we
us."
—
o
deceive the American people and
much
So
ft
we
Ha
for
V»Af
happens if in the spirit of an international
1
.1
,
*
_
'•
, ;
the loan. If we Good Time Charley, we should
Britain will not use a new type of dollar diplo¬
what
It,
do not approve
do
__
-
it,
If we are going to forgive 20; only buy from us, she will be fi¬
billion dollars of lend-lease ob- nancially able and has agreed to
db a number of things
which
I agree with him.
approve
nation with b
an
economic
theory.. If this theory has merit,
ligation let's do it on its own and
would avoid economic blocs and it should prove mutually beper
secure some rights in
bases, air¬
encourage
the
restoration
of ficial. yln that event, why should
ports, also bought with the blood,
world trade on a free, multilatwe paj
pay the
British to
a fuipolmc jLJAH/iaii
J.U adopt a
sweat, tear$ and money of the
eral basis. This means that goods icy which our free traders con^
American people.
would flow freely in response to tend is desirable for their owq.
If
we
going to make
are
com¬
us make them
sound commercial terms with
on
loans,—let
.demand
customer
with
value
and
product
minimum
a
of
gov-
ernment interference. Under the
them / and
proposed arrangement the pounds
under; terms that will enable the 1
Collateral
to
secure
•
Britain would.pay to other counborrower to both benefit and pay :
tries for current imports or in reobligation.
■
1
• ;'*
\ duction of her debt would be
the
.
,
.
bribe
to
macy
a
embrace
to
loan
v»c
—
—».
mercial
Third:
a
opposed because the Brit-
am
war.
*
* ••
-A' imposed upon
fully Jthe
obligation
.
country?
,•
We parents are
admonished by
psychologists not to bribe
children to eat spinach, but to appeal to their own self interest by
pointing out what spinach did for
child
muscles of Popeye. -.
the
,
For
the
sake
of
good
and freely exchangeable into dollars
The real objection to the loan is
to make it easier for those whose
their hasty agreeing to Bretton interests
are largely concerned friendly relations between our which these countries could spend that it is a stone in the larger mor
Woods,
settling i lend-lease ac- with foreign trade to secure its two countries and the sake of be¬ for; Americari goods if they ;so saic of goofy economics \^hich reIn addition,
counts and agreeing to some time approval by the American Con- ing honest with the American desire.
sound, fair gards money manipulation as. a
people—whose money we are giv¬ economic
consult about lowering tariffs and gfess.
policies
would
be cure-all. It is hot to Britain's longing away—this, loan agreement adopted and urged by us both in term interests for us .to ladle out
eliminating Imperial preferences Fourth:
should be defeated.
order- that exploitation, provoca- billions to enable that country to
Wh^i^thf* rfi«!pii<;on<! originated
1 am opposed to it because it is
tion and discrimination by one perpetuate existing abnormalitiesf
last summer the British press and
country against another shall be Instead, Britain needs tq put he^
afpar< °hf se.vera! agreements, one
py PHILLIP D. REED
forced them to take it, along with
.
.
the
British
and
honestly
coihribuapproximately 20 billion
American dollars without secur.-additional Island
f*. which wipes. °ut
negotiators frankly
stated they didn't
want a loan—they couldn't pay a
loan—they wanted a grant-in-aid
or another gift or at best an interest-free loan over a long period
of time. Here is what they said:
Sidney Campbell, financial ed¬
itor of Reuter's said in July:
"One
thing should be made
Clear about the present discus¬
,Jon ?
from them, and haying converted
most of her manufacturing plants
to
war
production, she could not
make
payment
by
exporting
manufactured
goods in return.
protection and the
But this war-born debt is not the
peace of the World in the future
The
—because we give up all surplus worst; of Britain's trouble.
immediate problem is that it will
property and all construction and
?a
for
f°r our Navy or Air Corps
our
own
.
installations located in the United
take
several
to reconvert
peacetime manu¬
years
and rebuild her
Kingdom
without
acquiring
a
the point
single landing right on air ports facturing output to
sions in the United States about a
where she can pay currently with
created
by American
sacrifice,
loan of three to five billion dol¬
for
the raw materials,
blood and money throughout the export
lars to Britain. Britain would alfood, and other products she must
most""certainly refuse* anv'^such British Empire to aid our future
import to live and function. Until
tarn however bie it mieht be or civilian commerce as we struggle
the day comes when her exports
the equal her imports, Britairi must
are rather, mystified as to, why eiF® thmLhnnt somewhere find additional credit
Americans trouble to discuss the
X w
;to fill the gap.
howeverlowthe8 merest Th£
^
2^wil
A
matter.
gran^-in-aid would, of the worm,
course, be accepted."
-
Lord
Fifth:
Keynes,
the
principal
negotiator, frankly ex-
j
opposed to it because we
are loaning it fo the Government
pressed their position. He arrived 0f Great Britain Which
presently
here in September and he told us
js a Socialistic experiment in the
he was here to make some kind of •
hands of a party headed by Har¬
an arrangement about
lend-lease, old Laski who blithely denounces
and" about some way of helping
our
form
of
government
and
England struggle-out of her eraH
pconomy at* the very, time when
nomic difficulties. But there was
we
are
struggling to reconvert
one
thing he wanted to make our all-out war effort
tQ peace¬
plain to us. That was that Brit¬ time effort to sustain our
British
am
.
pedient."
-
.
r
ge continued:
? We are nof in the mood, and
treat all
our
are
Seventh:
j am opposed for I know that
this does not meet the financial
can
to get on as best
any
-
other lines which
nUf*
*ej
xr
?5je?
•,
we
tT-i
can
are
open
•-
..m.
Times
wu
on
com-
i
Hot only did he fear that the
deception would probably have a
short life but it would be ex-
very
tremely
shortsighted
if
the
ab-
needs
is
merely
which
in
of
additional
bonds.
The
bttt
Britain
stop-gap
a
we
is
*
arrangement
have forced upon them
connection
with
that
agreements
•
other
the
are
presented
with.it. It will lead only to bad
feeling and ill will between two
former
iies jn
devoted
war
and
trusted
and ^wo great
al-
peoples
wh0 should always be the closest
in Peace<
....
„
Nevertheless,
our
negotiators
insisted they accept a loan of $3,750,000,000 at 1.62% interest over
a 55-year period even
though we
will have tp borrow this money
from
our
American
people at
at least 2V2% interest through the
sale
Great
one
of the principal aims."
,
Mr. Wmston Uhurchiil, who
so
P1.^
^
the darkest hours of its
I^lsJory' °PP°sed thls loan and alJ1
agreements and led his col-
^
*
r>f
1945 in the House of Commons.
"Ite ls
a
,
pity that
we
should
terest from
agreement provides that the inthe British does not
have allowed a commercial loan
agreement to be mixed up and
start for five years
linked
and then any
time the United Kingdom decides
that the exchange conditions are
not favorable they can request a
waiver
and
the
United
must grant
victen
States
it. There is no proa
•
that 4-u
the American
people
economic
dynamite
blow: them apart.
From what I have said you
and effeet of the loan is to arrest the
trend toward nationalization and
control
It emphatically does
not assist other
and
of
could
countries to nationalize their industries
as
is sometimes
And finally, let me make it
quite clear that the loan to Brit¬
no means
done
one
to her.
open
creditor
the
mentioned
others
with
trades and
countries
and
whom
arrange
her
supply
against
to
I
have
number
a
of
she normally
with them to
essential
imports
promise to repay in the
These
countries cannot
a
future.
afford to
lose
the
mistak-
enly asserted.
by
and only
She must go to
course,
interna-
government
tional trade.
not
can
rehabilitation
and
solve her
only
+
facilities _on
for
n
their
attack
nomic
problems of
under
reconstruction
ditions which
eco¬
con¬
healthy for de¬
velopment of world trade and the
preservation of world peace.
It is for
we
are
to decide whether
us
shall make the loan and set
WryylrJ
^
and that some _erm gration. to the
under-populated
monwealthsr including . Canada, is
.
-
in In"
order"
curing
Britain's sick indus¬
psychological es¬
capism is needed. John L. Lewis
tries, more than
archaic
imins
minpr
TiriticVi
metbods and
tools,'produces
bare-
|y one-sixth as
ir
Britain,
States,
States, and
and +v.p
the vnct
rest of the world
to
British family table.
A/*er Britain takes inventory
its remaining natural resources
*n the form of coal, limestone^
IF01?', *?a.y ppssl Z;
that the . island is over-populated,
much coal per
^ day as one American miner. The
fu mtaT
i remedy lies in mechanization—
the United
^
possible
ways
through
modernization
Jiiill?
unavoidable, the British should,
way of: illustration, explore
of gettingrelief through
modifying the policy of importing
will f?
Mhe/°u,d placed 0n th®
to
See that the true purpose
be
one
tions.
wdh
other transacHe said further:
up
"Not only is there disappoint-
ment; there is deep misgiving as
to what the consequences will be
a
~
,
...
in
modernization—not
in
not
modernization
begging
urging
question and hanging up at
mine pits a banner reading
the
the
"Socialism."
As a matter, of fact,
if our Gov¬
wouid desist from this
adventure of its own in financial
Socialism
and instead let the
United Kingdom finance itself in
W»ucu limguuni miouvv .wvre
ernment
nrnmntA-^the open market through the of^ omote peace, jobs and prog- fering of bonds to private inress, or refuse the loan and thus Vestors our British friends would
to
•
^o%e
by
hafatav,StePd tep,3 r°^d tha| the discipline of the market! Od ;
pf ?IC and, the other hand, when our Treas- L
y warfare. Remember that fury makes a proposed loan on in-*
force Britain to take a long and
be^
miiitarv
•
-
•
today's
a
the
under such
international
flow of
goods would not be meas¬
ured by demand and quality and
price—the hallmarks of private
enterprise—but
by . government
decree based on political consid¬
erations^ Again; as in ^
the total volume of world trade
be
would
drastically and tragi¬
cally reduced with resulting loss
of employment opportunity here
at home.' Governments would be¬
come
the
world
trade
dominating
and
the
factor
free
in
enter¬
prise system would suffer another
and perhaps fatal—blow.
And
I say, if we refuse the
Britain, we will gravely
risk partitioning the world into
three or four politically controlled
economic blocs, each battling for
dominance and power, and there¬
by not only breed the germs of
oan
so
to
another
war
to
to
but
seriously limit
our opportunity both for jobs and
better living standards. I leave it
you
here
decide
would
be
in
what
chance
this
atmos¬
conflict—
next
British
is:
STOP
BY
FOOLED
YOUR
AND
TOWARD
PROPAGANDA,
OWN
START
A
GENUINE RECOVERY BY FAC¬
also
hard
we
tu&u
our
uur
dencies.
And, finally,; where did anyone
the idea that our EMPTY.
BURDENED, Federal
get
DEBT
surplus to lend?
Treasury has a
ING THE REALITIES.
Under the old order,
served
as
the
little Eng¬
workshop
that
for
faraway
concentrated
on
colonies Win. Smith & G.
Pragmatic
Nineteen
national econ¬
both industry
Thirties
as
part
imperial Preference, under which
nations •• of the British
Commonwealth enjoyed more fa¬
vorable tariff rates than outside
member
members of, the New York..
Jan. 24,
, .
nue,
Stock Exchange, on
as
ment for the loan, we
promise
from
an
induce¬
seek an im¬
Britain
to
such devices, and revert to
Why we should ask a
free trade.
J.
Jerome
Suffered
and
a
ernor
-
Dies
Danzig died in Sah
from
Francisco
after
a
an
.
heart
attack
illness of two L
half weeks. A former gov¬
of the New York Stock
Ex¬
change, of which he had been a
member
nations.
however,
partnership in Bell
Beckwith, 519 Madison Ave4
&,
of an
wisely or unwisely—introduced
scrap
be admitted to
during the
adjustment to changing conditions
Now,
Smith
J.J. Danzig
Britons
Admit
M/Tod#
TOLEDO,
OHIO—William J.
and George M. Todd wil|
producing
materials,
which • w er e
swapped for British manufactured
goods. That former trade balance
has been upset by. the growing
ambition of each country to de¬
raw
velop diversified
omies, embracing
and. agriculture.
Bell & Beckwith to
industrial
land
plied
of the United Na¬
the
the
to
MAKE
make
a success
for
BEING
phere of struggle and suspicion to
tions
already
historians
name
Organization or to create an
ability, however effective international control of1 friendly ally to tie its own hands
aomiy, nowever' effective internal
is not clear. Nor is it clear why,
try, to discharge success- the atomic bomb.
and
aau
know that
all
circumstances
of
fence of friction and bad feeling friends
between the two countries
of
scheme
becomes
That
have
We
ex-
war debt.
We would far rather do what we
by
it
advice
allies alike,
believe and hope that you
periences of last time's
as
the
blocs
have credibly "soft" terms, such as a '
1.62%
interest rate and a pro¬
they call it the Last World War.
vision that interest be waived in
years when the borrower finds it :
By RUKEYSER
inconvenient to pay, the British '
The top obligation of a good Lords,
nevertheless, rise up in
unsecured - loans or which in
turn would trade within
neighbor is candor. My friendly protest against our Shylock ten¬
gifts of America's money we must themselves.
i
not in the mood, to repeat the
we
keep the.United Nations together,
Under
will
"
>
Rather than fatalistically accept
thq abnprmal pressure for exports
ain would
—
,
tional trade becomes a binder to
Under these conditions interna-
Now, if the United States does
hot furnish this credit, Britain
large amounts
system already owing them and will
ain could not afford to make a
of
private enterprise under .a have to agree to continue supply¬
commercial loan in this country.'
truly
republican
representative ing Britain's essential needs until
To quote him, he said:
form of Government.
she can rebuild her exports. Hav¬
m
"No doubt an easy course would;
ing comparatively few dollars and
be for you to offer, and for us to Sixth:
no dollar credits, Britain and her
put our name to a substantial loan
I am opposed to this gift of $4,supplier countries would be able
on more or less commercial
terms, uou,000,000
000,000,000 of the American pe
peoto buy very little from America
without either party to the transpie's money under the guise of
and would be forced to deal al¬
action troubling to pay too much
loan that has no collateral—no se- most
exclusively with each other.
attention to; the question of the
curity—to a socialistic
experi- The result is an economic bloc.
likelihood of our being able to
menting form , of Government, Not only would the door be slam¬
fulfill the obligations which we
knowing full well that it is only med to the sale of American
were undertaking.
m
the forerunner of additional huge
products in this area,. but one
"However, this may be—'
loans to Russia—China—France—
bloc. leads to the creation
of
He said:
the Netherlands, etc. If we are goothers — a
dollar
bloc
and
We shall not lend ourselves to
ing to try to establish peace in the Russian
bloc,
for
example
any such soft and deceptive exWOrid with
'
economic house in order.
outlawed.
for
retired
he
five
years
reer
with
more
from
ago.
the
Seuchatwanger
than 47 years;
active
business
He began his ca¬
brokerage firm
&
Co.,
later
of
or¬
ganizing Jerome J. Danzig & Co.,
of
100
Broadway, New York.
Volume
163
Wants Free Enterprise
(Continued from page 245)
doctrines and beliefs, and these
conflicts,
ing of a cumulative lack of knowl¬
edge regarding economic truths.
"Since our leaders are confused
and
terribly inept in
explaining
thej r owri economic confusion, is
it any wonder that uncertainties,
unrest, ; suspicion,
and
general
lethargy is the residual matter
:
that has flowed down to the great
bulk of
when
our.
people, and in an era
enlightenment
was
never
desperately needed
a. more
American
modity,
com¬
management
and
quately to tell their story, they
nave
permitted the fictions and
false cioctrines respecting the con¬
tributions of corporations to our
victorious in these conflicts.
"I think it is time to make sim¬
ple explanations of what corpora¬
tions are; how they came into ex¬
istence; what they do in providing
employment and better goods and
they
revenues;
they have
ofignoring
the
rushing,
black
waters of destruction already lap¬
ping at their feet.
I
,
"Specifically, I would like to di¬
,
rect
that
attention
your
to
the
fact
a
growing number, of ; our
American people have become acr
tive subscribers to the tenets and
beliefs
lieve
of
sta'tism—that they be¬
economic destinies can
our
best be preserved and augmented
by government control of the pro¬
cesses of production and exchange.
Another vociferous. group, postu¬
lating the premise that private en¬
terprise
has failed to provide a
good way of life for the bulk of
people, propose government
ownership of all productive em
terprises. Liberals, pseudo-liber¬
als, academic busy-bodies, col¬
umnists; "enlightened" newspaper
pur
■
of
they promote the
best interests of ail of us through
workings of a free competitive system; Where their owner¬
ship lies; and finally, how they
are
the indisputable
source
of
continued econdmic,. financial, so¬
cial and moral well-being for all
the
politician's
program of
stock
in
embarked upon the
are
convincing the-public
that they are the saviors of the
Nation. Their attacks on business
and
industry
based
are
ancient fallacious
iness
the
upon
theory that bus¬
is ^something
legitimately
"illegitimate."
:
trating
mounting, stormy,
pene¬
the
put, have prospered and won new
converts, because American' man¬
*
agement people have failed to
provide the true story of the glori¬
ous
achievements 4 of
•
American
free industry. Even today, the best
we can wring from* the, malconp
tents
is" grudging
classifications: A. Raw Materials;
B. Tools of Production; C. Human
,
Energy.
"2.
That corporations came into
existence basically as institutions
to
provide
and better tools
raw materi¬
more
for the fabrication of
als
through
the
•v
prise
well
performed reasonably
ill serving as the arsenal and
has
pantry' for most of the
universe.
5
enter-
'.
'
-
"Actually, the
*torri
•/;.
war
;
herculean*
task
that American business has per; formed since 1941. will probably
4 be Recorded as, the greatest iridus-
.
"3.
Thus,
nothing,
the
more
corporation
or
less than
solidation of tools into
a
is
con¬
a
coopera¬
tive effort for the purpose of pro¬
ducing and exchanging more and
better goods and services.
"We must tell
corporations
the
are
of
owners
our people that
only trustees for
the
tools
of
pro¬
duction,
"That the owners of the tools of
production
like
their
men and
are
and
you
who
me,
savings' to create *
tive ventures.
women;
pooled
coopera-
That these savings
used, to buy land, buildings
and tools and raw materials. That
were
and women were engaged to
men
run
the-tools of production to
;
trial achievement of all times, and
fashion; finished units that could
be I. exchanged
With; customers.
tvere; it not for the: performances
pf American industry, There Ms
That savings, ranging from $5,000
to $50,000 per worker were neces¬
good
sary
bird of
"I
of
do
not
people
are
that
the
victory might be perched
prophets
y
believe
the banners of
on
•
to
reason
think
who
enemies....
our
that
follow
the
the
bulk
.
vicious—that
intentionally.; embarked
are
I
great
think
are;
threshold
volt
of
the
of
some
are
I-
masses.
economic
where
they have
but who
*■
ventured
can
tell
v
re¬
fields
no.
an
competence,
engaging tale
of economic Utopia.
,■
-
knowledge
our
respecting wartime
aims and objectives. American in¬
dustry through the various spon¬
types of campaigns, supplied
bur people with more basic infor¬
mation
concerning
common
our
"I think the average American
Hunt.
William
A.
search
a graduate of Harv¬
University, started his finan¬
career
seven
from
Paris
with
offices.
White,
each in the
London and
year
York,
He
associated
was
Weld
&
Co.,
he
Lehman
Brothers
was
associated
with
doing research
Mr. Hunt has been with White,
Trust Company of New York,
one
after his graduation
Harvard Business
years
Yale and
Schools
for Lehman Corp.
in 1935 with the Guar¬
New
Development Branch,
and
Military Planning Division, Office
of the Quartermaster General. For
Mr. Weld,
cial
bank's
took
year's leave of absence to serve
the War Department as executive
assistant to the Chief of the Re¬
Barron
ard
working
been
a
partner in the Boston office,
a
anty
sored
than all the professional
dangers
and amateur literary and
political
Weld & Co. for the last 14 years,
syndicate manager in
1933. In 1924 he became associated
becoming
with the syndicate department
of
W. A. Harriman & Co. and later
from
joined
1938
the
until
U.
1942
S. Army
when
,
•there should be no discharges—
no
G.I;- Bill of Rights for you, un¬
til
you,
working in concert with
free industry, plot the
American
battle plan,
nomic illiteracy.
"I
truly believe that men like
created from a convinc¬
ing pattern—that you are men of
hard humility combined with ac¬
you were
tive
imaginations.
terned doctrines—-or because it is
unpardonable) sin for
an
venture into
reasonable and ade¬
you to
the economists' field*
—for whatever reasons—I can un¬
derstand-why
you have not been
broadly
up
to
the
present to come to; the rescue of
challenged
a
situation that is extremely
des¬
perate.
"But 1 believe, generally speak¬
ing, that
you
realization of
have a good, hard
the primary inter¬
ests associated
business.
with all
I
pelieve that you accept the code
of thinking that the interests of
workers, management, owners and
pense
a
-
4 "But because of too much hu¬
mility—or because you have per¬
mitted habits; to harden into pat¬
savings made possible the job is
entitled to
underwrite the strat¬
egy—enlist the common support—
direct the attack, and in every
contributory manner serve as the
leaders- in the war against eco¬
customers
,
con¬
a
of
"It
seems
beliefs
the
and occupancy
use
house he might own.
a
to
and I think my
me
are
well
documented
record,
that
every
by
time
^Nation is, confronted with
our
a
na¬
tional emergency, the advertising
fraternity is the first agency that
is
called
that
emergency, its perils and what we
must do, in a united way, to overcone
or
upon
defeat
to
explain
the
condition
of
things that interrupts the orderly,
peaceful way of life that we want
for all
our
"When
is inherently fair and when indus
try underwrites a program of ed
volved
pcation ' and enlightenment re
garding the simple way we earn a
living, the messiahs of revolution
and
change will
quickly find
upon
people.
one
inseparable—that
are
not succeed
may
at the
of the other—that
business
is
ex¬
good
today, no
constituted
as
our
in
chandising
Nation
wars,
our
became
retail
in¬
to
LOOKS LIKE A WAR PICTURE but It's right here iri
cable-laying job.
the U. S. A.
It shows part of a telephone!
install 2,100,000 miles of Long Distance circuits within a year,
We plan to
managerial of¬
embarked upon policies
group of owners or
are
of human exploitations. I believe
linked to each other—and
lack
of
knowledge,
alienism
or
nation
and
know¬
bureaucracy,
rabble-rousing to
cessfully challenge
a
or
suc¬
threaten
lots of action on the Long Distance
still pressure on
the wires. But we're on the way to
giving
and better service than you've ever
you more
had before.
spite its detractors, is still the bul¬
house for nations who would have
war.
gone
down to ignominious defeat
were
it not for the workings of a
system."
McCarthy also is associ¬
with the
All
cable,
over
Dame, his bureau
lished
and
University of No¬
in
1937
reports
taxation
and
was
to prepare
on
money,
other
nomic subjects.
estab¬
studies
same
are turning out equipment for
speed that they turned it out for
land, telephone men are laying
the
installing switchboards and working
telephone buildings for the nation's
on new
increased needs.
job and it will take some time
It's
a
tremendous
and
a
lot of money.
and
efficiently, with
ated with the Bureau of Economic
mer¬
tre
\
Telephone factories
peace
Research at the
1
a
system, which de¬
free industrial
But we're going at it, eagerly
every resource at
our
command.
banking,
general
eco¬
.
4
front
Long Distance calls are still at a high level and there's
wark of democracy and the ware¬
Dean
fraternity was called
help underwrite a war
advertising campaign. You used
the existing media skillfully and,
from an educational point of view,
themselves without audiences.
you accomplished an outstanding
"Labor has always been suspi¬ job
of educating and bringing
to
;
literacy
to provide a job for a single
worker. That the person whose
that
charlatans
into
contributions
and
accounts. Early in the war he
been ad¬
They are
firm.
has retired from the firm.
amazingly good
your
ing this, that you will not permit
ugly cynicism, ignorance, apathy,
and impractical dreamers who in
have
been
ceive rent for
the
turn- have been assisted
by the
great fraternity of writers,' radio
commentators, newspaper colum¬
nists and political stuffed shirts
who
have
Jr.,
you know very well that our in¬
terests/our successes, our futures,
are
commonly and irrevocably
people's minds ' have
been
temporarily captured by the false
of
a
Jansen
our
corporation fails to receive an
adequate return or wage for the
tools, he is being cheated, just as
surely as though he failed to re¬
our
doctrines
agencies
were
support. These and
multitude of similar campaigns
worthy of
ficials
on
think
man
associated
and
the
new
Weld, son of Francis M.
Weld, a founder of the
firm;
Harold T. White, Jr., whose father
has been a partner for 30 years;
William C. Hammond Jr., and E.
power—why the USO
and woman
have
partners
into
Ex¬
Stock
that four
David
tribution to the corporation. That
whenever the ^saving-investor in
upon
Marxian
mitted
York
announce
general
they
misinformed. I
we
change,
quate return for his risk and
revolutionary trend.
they
don't believe that,
industries needed
war
New
the
of
and
has
September.
Mr. Hammond, a resident of
Boston, has been associated with
Loornis, Sayles & Co. for the last
10 years where he was engaged in
research and in the handling of
White, Weld & Co., 40 Wall
Street, New York City, members
do to emerge
false
a program of destroying
them¬
selves—that they are creatures of
some
certain
human fe
of
use
energy.
acknowledge¬
that perhaps private
ment
"Patiently
all
of
elements
economies are con¬
three
understandable
;
in
tained
tirades
against American
free enterprise during the last de¬
cade, far from wearing themselves
must
we
He
White, Weld since last
«
*
"These
what
contracts.
represented John Nickerson & Co.
he
in New England and other sec¬
Air Corps as a tions of the country. A graduate
propagandists^ could achieve in a combat intelligence officer, leav¬ of Columbia and Brown Univerws-*-lifetime.
of: us
M * •
ing the service with the rank of ties, Mr. Hunt served as secretary
"It is not enough for us .to say
5:"BuL now the passage of arms major.
of The Bond Club of New York in
these things, and to assume, once type of conflict ends—the shooting
Mr. White, also a graduate of 1944-15.
they have been said, that they wars are over and there is likeli¬
will be understood and accepted. hood that you will be pushed back Harvard, joined the research de¬
They must be said again and again. or retire to those polite sanctums, partment of White, Weld in 1939. Pat Spanier Joins Staff of
In 1942 he went to Washington as
They must be said effectively in far removed from the major eco¬
a member of the War Production
Bennett, Spanier Co.
simple form so that everyone, no nomic battle, which in every re¬
Board
and
eight months later r CHICAGO, ILL.—Pat R. Spa¬
matter what his or her level of spect will be as serious in its Con¬
joined the United States Coast nier has joined Bennett, Spanier
education or intelligence may be, sequences
and ' implications
as
Guard Reserve. After more than
& Co., 105 South La Salle Street,
will understand the effective role were the military and naval en¬
a year in the service he was em¬
corporations play in supporting gagements.
after an absence of four years in
ployed
as
an
engineer
by
Ray¬
our type and, concepts of a free"
"But because of the amazing ef¬
theon Manufacturing Co., working the armed service.
enterprise system;
fective talents possessed by men
"We must make crystal clear in
your profession, I suggest that
basic truths like this: '
there should be no peace for you
"1. That
trade and
tax
how
productive
seized; the
people; how
the principal
collection of
the
for
galaxy
a
our
of
one
are
associated; malcontents; have
i^dio; commentators and
f
all
for
services
and empty
or,,
the
of
in understand¬
able terms, you informed' our Na¬
tion's people why we must buy
national economy and well-being, War Bonds—why the Wacs—the
Waves—the
Seabees,
the ' Mer¬
to flourish, grow, and exaggerate
themselves.-1 y;;y y.yV!:yy.-yy<;vy -,/■; chant Marine the shipyards and
sources
elected to pursue the naive course
,
poration industry has failed ade¬
people have been capable of sup¬
plying nothing but hollow words
phrases,
people an awareness
enemies we are fighting
war
back with
Foar New Parliers
to our
nome
u
on
While, Weld Admits
Accomplishments Cited
corporate forms of inuuStrialism, and largely because cor¬
cious
in turn the flower¬
are
267
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4456
BELL
TELEPHONE
SYSTEM
""
v
.
THE
COMMERCIAL & FINANCIAL CHRONICLE
-
Inflation
(Continued from first page)
has the advantage of pointing out
be
to
or
'.
more
18 cents
ton, butter by
a
pound,
a
-Thursday, January 17, 1946
etc;;/,///)//,//
Uncontrolled prices have risen
for this .accomplish¬
paid
potential currency but hot by the
-100% and more;
ment consists in quality deteriora¬
general public
mone¬
Black market rackets harass the
hature of the phenomenon and its
tions, mushrooming black mark¬
ets, and demoralizing subterfuge
nature of government paper
has been" contested even
by econ¬
most
practices.
authorities in controlled articles,
from second-hand cars to whis-
both
essentials:
the
significant
psychological
the
aspect,
"re¬
lief" from inhibitions to
spending.
It results from mass-expectations
circumstances
ing
present
and
prospective, leading
from
buying spree to another.
one
In effect, speculative
merely are canalized
tendencies
often
highly undesirable di¬
as
price-fix¬
ing conflicts with rising costs, the
result is not only a misguided al¬
into
which in turn arise from underly¬
Inasmuch
rections;
location
of
productive
resources,
Expectations are. decisive, in¬
deed, to explain such a paradoxi¬
but the actual stoppage of produc¬
tion—with prices rising in a de¬
cal situation
layed
that prevailing at
as
in
the
lace
of
reduced
national
of
even
hesitation,
to
Full Production and Inflation
.
.
However.,: the
which
the
say
reasons
sion"
on
the OPA. It has
should
the
quotations
accompany
Stock
deep-seated
so
tions
and
only
waves
few
with
interrup¬
far
between
not
are
to hold sway.
permitted
'
■
.
Subdued Deflation-
{
J
|
V
7
country's
excess
iieit
credit
poultry, dairy products, tobacco,
fruits, vegetables, cattle and feed
ample, if not at record highs, to
Gay nothing of surpluses in
grain,
cotton,
copper,
aluminum
and
ox
loaded
with
vastly
ume.
expanded
monetary
.'
the
first'place,
a
of
consequence
people lack
the
vol¬
apparent
flection
in
power
a
is
1
a
to
see
sequence
to
a
par
respect
for
the
and
public's
This "ideology" operates
as
anti-inflationary factor, but
bound to turn out
ous
boomerang,
a
even
an
it is
very danger¬
if the policy
.s
kreak down under the
weight of its own clumsiness. The
naorev
successful
Keeping
more
basic
the
prices
OPA
is
stable,
in
the
it misleads the
public to re¬
gard individual price increases as
immaterial, making it rely on the
of
a
general
stability.
fiction
Moreover, the sheer bulk of
price-fixing job compels the
thorities
to
leave
inclination
In
be
luxury
the
to spend on
sell
barely 40%
In other words,
the
what is called
on
ed
above pre¬
ac¬
of
"speculative" price
not
takes
that
the
more
goods
the
on
founded
the rise of costs. But
the price
by
spending
bring about
providing it
curse
of
"natural"
own
greatly accelerat¬
necessitates more
a
:
'
Apparent Exchange Stability
bonds*
coming back to the defla¬
tionary outlook and its compon¬
ents, two monetary angles of the
present situation have to be point¬
ed out which are
helpful in re¬
straining
'
inflationary
-
expecta¬
v
bull
market
in
One is the fact that foreign ex¬
change rates appear stable. Ris¬
ing quotations for foreign cur¬
rencies (and gold)
are
the unfail¬
ing signals to invite higher prices
commodities./ This signal is
eliminated by the totalitarian de¬
vice
of
"han^es
controlling foreign
exwhich helps to maintain
the fiction of
of the
Britain
an
unfettered value
currency. The fiction of
of
market
per
gold
a
price
(abroad)
ounce
in U.
as
S.
ex¬
freezing foreign
on
lion
the
on
high
as
Currency
average citizen knows
that, and relies
gold reserve,
selves and makes us slow to anger;
sometimes find, it. difficult to
we
talk
about
ourselves.
suffer
often
self
bil¬
half
of
We
Germany.
the
at
evidence
clare
because
war
Hitler
it
put
the
back
to
with
the
hate
we
Britain,
time/when
from
men
war.
to tiredness
But looking
down
lack of vitality.
and
de¬
We werfe reluctant to
much.
breaking down, as indi¬
the last Christmas
are
cated
by
demand of labor for greatly in¬
creased wages and the willing:
of business to meet the de¬
ness
:
be raised—indicating the Con¬
viction,,not doubted apparently
by anyone, that the public will
be willing and able to pay sub¬
stantially higher prices.
These
spectacular symptoms
are
of the bulls' supremacy over the
bears, under conditions most fa¬
vorable
to the latter. The copybook picture of the "business cy¬
cle" is being
thoroughly distorted-.
Indeed, this is part of a different
kind of process; of paper money
inflation.
the
British
factor
at
purchasing
that is being put into cir¬
culation consists of money in the
tangible sense: of legal tender.
The bulk consists of bank
deposits
of short-term bonds.
Deposits
by economists
as
About
damaged
was
by
in
three
every
totally destroyed
bombardment.
In the
enemy
or
heavily bombed cities the pro¬
portion
was,
of course, much
higher and in London, for ex¬
ample, it was the exception to
escape damage.
Over 60,000 ci¬
vilians, men, women and children,
were
killed and
86,000 badly
over
injured, v Out of 32,000,000 adults
of working age more* than two
out of three either went into the
services;
or
were
proud now that it was our small
fleet of fighter aircraft that in
the enemy his first
thorough beating, first turned the
tide of war, and established our
island as an Atlantic fortress. (In
gave
small
fleet
the
honor
we
Americans of the Eagle
Squadron of the R. A. F.) With¬
your help and without
the
help of Russia, civilization could
not have hoped to avoid defeat;
but
our
people
are
glad and
young
out
the
and
battle
after
first
to
have
to
the
to take up arms
been
gallant Poles
the world
save
domination.
Nazi
from
in the front
to have been
proud
Britain's
t
Now
of
years
Sacrifices
War
what
war
did
six
the
long
practical
You,
impact—and heavy
mean
too,
felt
its
you
and
in
we
of life
total
of
I
same
as
in
don't
it before
think
ours.
measured
population
: was
greatest of any nation.
it
erty, but
;
we
in
i
even
in
the
We prize
up much
for freedom.
gave
the fight
ri.KljLiii
each know
we
faring.
for
mobilized
war
not
yet
made
Mi
lives.
our
for
for
out"
over :
was
a
production,, all
and
We
war.:
had
strength
our
women
»
time, I
We had put all our riches, all our
men
•
had
we.,
long
a
•
much
It
and
us
is
•
is
the
,,
i
of
into winning the >.
been
with-*1
doing
.,
out
/every
possible T.thing • we
dared, cut home consumption to
the
bone,
even
gone
without
which before, the war we "
had! thought were essential. When
peace came the only things we
could put back were those which
cost
us
practically
nothing in
labor or raw material or capital—"
foods
taking the black¬
our windows,
abolishing censorship and security regulations.
1,
We are sincerely grateful to be
relieved / from
the
gnawing
things such
as
curtains
out
from
who
were
and
husbands
anxiety, for
away
in the
A
sons
services.//;/
grateful, too, for being
air raids and flying'
bombs and rockets; although we
haven't properly got used to it
We
are
free
from
and
often
have to think twice
automobile in low,,gear.;
noise like a siren.
We
an
a
got used to hav¬
street lights on again and
shop
haven't really
ing
our
we
still can't afford to light
allow elec¬
windows at night or
tricity to be used for advertising
*
signs.::.'
"Poor in Money"
When
had
we
got our breath
and checked up we found that the;
war had not only left us compara-;
tively
<
in terms of moneys
appalling shortage of«;
poor
We had
an
The
half million left useless after air.
work.
war
,
..
that
fight
"all
other
the
..
now
victory has
been
how
.
And
1
Neither
could
we
get
housewives, raids.
young children, invalids and so going on building homes or mak¬
clothes or even restoring
on, and all of those who could ing
did
some
sort of part time volun¬
Three out; of
war work.
British boys
tary
four
14 to
and
men
girls from
old were on vital
work/ between 300,000 and
17
normal health
years
the
}i,
Then, to make matters worse,
must remember we live on
we buy from other coun-
what
-
,
7
tries, largely from North Amer¬
We have been big customers
ica.
of
yours,
your
biggest customer,
paid
and in normal times we have
part
our
sell
bills by what we make and\
to other countries.
To win :>
the
war,
Our
and
seven
over
time
of
,
Defenders, which in¬
cluded firemen, fire guards, air
raid wardens and the invaluable
by
millions
until
services
home.
came
you
Civil
Women's Voluntary Services.
1%
was
million
strong Home Guard
army of part time
the hard training
citizen
a
soldiers / and
they went through was additional
to their long hours of war work.
Like
our
American
your
women
women,
have done a magnifi¬
job during the war.
It has
been no easy task for them to run
their homes.
Food has been lim¬
cent
ited
and
rationed.
severely
'We
we
our
needed
that
business.
The diwhen we are
industries from war
to
peace
and getting our men
back
to
work,
is
how
much
energy and capital to devote to
lemma
we
turning
our
rebuilding
our
ficed
and
export
rely more upon potatoes. We have
careful with milk and
deliver
it.
You
can't
choose
or
change your milkman in Britain.
Women hate that!
Orange mice
is reserved for expectant
and
young
mothers
children.
The
vital to
Shopping is
It
is
a
no
some
have
we
much
trade
us.
of
the
to restoring
which
,
///
sacri¬
is
N;
so/;//
'•;.•/•[ //;'//v7
cheerfully accepted the situation,;;
and
made up their minds to a
few more .years of going without. :
There
is
very
little grumbling C
and nobody is blamed except Hit¬
ler and Tojo.
The grim life is
accepted in much the
same
way
.
"
longer
of
:
they accepted the grim possi- ;//
bility of invasion in 1940.
;
as
"Queues"
work
lives
This has been explained to the;/"
British
people
and : they
have*
Of
ure.
how
/
.
homes and putting
amenities
decent
•
face,
our
into
back
that
careful with the labor of men who
-
.
should have to rebuild ;
we
export
of the foods we knew
to be very
securities
overseas
export trade, and before
could even buy the food we
our
have forgotten
the taste of many
before the
war. We're eating 25% less meat,
55% less butter, 35% less sugar
than we did before the war. We
'1
though,-we deliberately ,.1
sacrificed
Our
above all things our personal lib¬
of that
important
other 10,000,000 were
change fa your
it did.in
effort
war
terms
were
in the theatre of active
and
is
homes, thanks to having ceased.
building for six years and to the
400,000 men and women were em¬
ployed on whole time fire fight¬
ing, rescue, > and similar work in
air raids, and they were helped
India), the Colonial
Empire,
and
many
individuals
from Ireland (and great fighters
they are!) who had joined us when
we were alone, we cannot but be
0:
TV
completely
Australia,
(that is Canada,
New
Zealand, South
,
that we
should understand one anothqr
and that it helps us to do so if /\
makes
home
one
Commonwealth
that
it
when
war
way
vf
of
get
we
<
The
entailed the
>r—V'
bit
a
Nuremberg Trial has shown how
the
ivr*
of
we
most misunderstood in
were
operations
recognized
wonder
misunderstood!
technique of money
creation itself. Only a fraction of
die
lack
No
so
terms to the British people.
the
of
are
claims.
the 20
only
monetary
volume
for
praise.
sists
total
We
certain that truth will out that
it was—but
in
haven't
we
sitive; we've got the sort of hu¬
mor that makes us laugh at our¬
play in the direction of minimiz¬
ing inflationary prospects con¬
or
ing
Faces Peace
got any, in fact we're rather sen¬
nothing
which is really ours.
Another
feelings—not that
our
the
power
inhibitions to consumers' spend¬
(Continued from page 244)
of
face
I he
un¬
instinct of personal liberty; we're
rather shy; we don't like showing
the
of
and
abated; OPA ceilings are breaking up, one by one: low priced
goods to rise 25% to 40%,
steel
castings 11%, pulpwood
cut $1 to $2 a
cord, cheap furni¬
ture 4% to
20%, hard coal 5
cents to 65 cents a ton, steel by
change stability is maintained in
ooen
2%;
farm
cotton
1940
r
,
;
for
demand is turning
quality and. therefore
higher priced articles;
to higher
to
mand if prices are permitted to
real estate values continues
for
This is not a////
It is my tribute
hard-luck story.
tough
jerking
are
price
worse. ./
difference to
Africa—and
But
tions.
Consumers'
/
.
the all-time record low of
The
i
and
deal
good
shopping which hit another all-
upward, in the typical inflationtime abrupt mannerthe net
long-term rate has falien below
the
liberated Europe conditions are a
time record in spite of shelves
progress on
more
its
production
through
"luxuries."
elimination
it
inflation.
ability and
price-fixing
increases—increases
the
more we
namely,
cure,
au¬
prices
war,
specialties command prices
in legitimate markets
up to ten
times the peace-time level.
complishes
for
come
available
Production
$70
England, while every-day arti¬
cles
be
rising prices to
tne
and other side-lines
unregulated,
With the result that the more the
necessities
are
regimented, the
stronger-will
action
(the
inflation:
price-fixing
with
place
the
the spread of the be¬
the limitless wisdom and
of bureaucracy. Whatever
on
the
price. That, indeed, is the
on
the
not
each—will
will
Full
war; and in part a re¬
sources,
is
with the incentive of volume and
a
Wishes.;■ '■. ^
,
into
and
This is in part
fact that
loyalty to governmental interfer¬
ence helps to
keep price expecta-
tions
more
versely,
there
the
of
Stocks
■
the way to Full Production). Con¬
vision
success
during the
its
for
market
greatly different from
/the one to which they are accus¬
lief
this
more
there
price level
tomed; partly
producers, both
both ways of enhanced
spending—
more
units
and
paying
wide-spread conviction that the
authorities are able, and will be
able to hold the line.
ana
buying
Price Fixing
In
consumers
.
.
:
of
part
we accept it as such.
that in many parts' of
know
of
.
Aug.):
We
re¬
be under the circumstances.
Since the rapid decline of the na¬
tional •' income
began
(end
of
savings, continued despending, and
threatening
inflation, nor of the fan¬
way to restrain spending and
especially the willingness to pay
higher prices. As a matter of fact,
defla¬
one
is
it
Victory and
think
picture, with $2uu oillions
long
tionary potentialities. The longer
outlook, too, is affected by psycho¬
logical tendencies which should
help to offset the impact of the
to
of
that
■
;
•
furniture, etc.;
can
on
analyzing the Full Production fal¬
lacy.
The point is that it goes a
keep the de¬
is,
face
variety into the family menu'.
1
;
We do not complain.
We know '
rais- to my own people and I am giv-%/'
Ing rents,via forced sale oi old ihg you these facts because I
cash
.but
takes
,
other food shops and women are
hard put to it to introduce some %
as
the fastest deflations in American
containing less goods and lower
history, if not the fastest, and in
qualities; / ;
T '
spite of all deflationary, or at
The most important of all sympleast
non-inflationary
expecta¬ f toms of discounting future ristions, the trend is as bullish as it
.ing prices is the determined
to worry
at home and abroad.; •'
pression from the door. But it is
merely the, immediate situa¬
is
fact
the
tastic volume of pent-up demand
not
tion .that
revealing
that in
a
the
ot
printing legal tender.
Needless to say that this obscur¬
process will come to an end;
in the meantime, it
helps to do the
trick—but does it?
after
boom
Subterfuge markets develop to
ing
wages and costs, and it takes no
cognizance of the monetary side
wage bill, with 15 to 20 million
Workers to be shifted around, with
the forthcoming
supply of fish,
to
get going, the idea is, and
effects of the industrial
employed (early September) to
rise to 6 millions or more, strikes
.further
depleting the
stores —it
the place of
/.•/:/ ■ ///•
I evade regulations, such
substituting credit instruments in
This is the most vicious fallacy
becioudmg the economic thinking
of this generation. It overlooks
me
time element; it ignores the
na¬
output and income down
about 20%, the 1,700,000 un¬
governmental
will produce so much and so
/ keys and textiles;
monetary system is obscured in
the public's eyes by the device of
depression, supposedly to
a comparatively short
period of full employment. •
tional
powerful forces
us
we
come
picture. With munitions pro¬
duction curtailed from $43 to
$8
by
America's
rate, the popular
being based on
inflation
conception of "money print¬
ing,": thq current inflation of our
ble demand will be satisfied. The
rent
rate), with
in
belief
a
let
about
,
(annual
do with
to
next step from here is
"Subdued Deflation/' may be
the best term to describe the cur¬
billions
At any
of
the
cheaply that prices not only will
not rise, but actually may fall, and
at any rate, pretty soon all possi¬
of upturn. At any rate, de¬
flationary forces
reliance
mere
a
unlimited ability to produce. Just
and real estate values indicate the
opposite and do
the
upon
price level has deep¬
than
er
that
omists.
idea
peat,
with
assurance
public looks
future of the
nothing of the temporary "reces¬
reconversion.
more
yet. The
as
tary
The
increasing labor supply,
declining national income, and
/growing surpluses—prices do not
fall as they should. There is little
■
but possibly
they would have
without regimentation.
deficits,
sign
fashion,
and longer than
present. The curious thing is that
/.LT
$2.50
7;,; r ^-TrTTJ-
a
pleas¬
great
in¬
genuity and considerable physical
effort.
It often means standing
are
a
course,
very
the
different,
circumstances
but
there
is
considerable similarity between
the
spirit of the British people
today and their spirit in 1940,
for long periods in queues at the
after
Dunkirk, when we stood
butcher's, the fishmonger'? and alone with the Dominions, when
../
>
Volume
Britain
nent
Number
163
4456
and when it
only
was
betore
clear that it
of weeks
matter
a
should
we
was
or
days
to
face
have
ruthless air-raids.
I
close
quarters—first
Supply
in
Mr.
of
and
Government,
Markets
■
cheerless
the
knew
facts
^CHRONICLE
Walter
at
this belief that strikes
Whyte
necessarily
Minister
Churchill's
the list of last week's
not
are
Now
bearish, I wan¬
path and warned
dered off the
that in this case a
widespread
public belief that they would
be bearish, would
hurt the
the Home Office was to see that
Strong rally eating into old 1929
market.
I know
every
aid was' brought to the lows. Further
only too well
strength indicated as
victims of enemy air-raids and
that the market doesn't
momentum
per¬
increases, but buying
to keep morale high.
It was a
now
is indiscreet. Suggest waiting mit of muddled thinking.
Its
heavy and trying time for all of
us.
London had 57 consecutive for dullness and reaction. Either or punishment is swift and only
Secretary
Security.
nights of
attacks and others
provinces, Scotland,
air
well.
as
The
it
fell
was
•highly probable that the air-raid
sirens would wail and that at¬
tacks would continue until dawn.
Everybody knew that that night
.
or
that they
might suffer horrible injuries or
that their homes and possessions
be
negligible.
market
I emphasized
that the time the
the belief
shows
ment in
rally looks as 3V/2 and 32 V2, stop 29,
,7 j •
still higher. But
*
*
*
ii *
the fleet can escape it witn
something more fun¬
More next Thursday.
minor damage. 'l\:k
7."
.•7 v7
damental
which
may
take
—Walter Whyte.
-;7" 7' Ht 7#.777*777#7:77777;,; 77' hold and dominate
intra-day
[The views expressed in this
To add to .the
confusion, actio n. This fundamental article do not necessarily at any
this column is written after something goes back to 1929. time coincide with those of theMonday's close or just after Despite belief to the contrary Chronicle. They are presented as
those of the author only.]
<Tuesday's opening. This was there is still plenty of stock
if it will
go
there is
time
how
unwinding the war
and winding up for peace and a
stand
firm.7 Firm
sound prosperity and we are set¬
point,
many
it was.
so
to
even
tne
of them, of pride in
the very bombs against which
they fought and tip to which they
stood.
They became bomb proud.
Here may I say how much we
appreciated the aid which came
to our people from- the United
that you may understand
so
we're
ting about this difficult job in
a
democratic way under a Govern¬
I think is a very
ment v which
sticking
are
equal to the task.
acters
feating the Luftwaffe.
women
know
why
It
because
is
you are so
the
I think I
determined.
risk
of
death,
injury and a lost home is a better
thing than, the certainty of slav¬
ery and the destruction of all our
free
institutions
if
we
to
were
buy: off the air-raider by sUrren-?
dering to the Nazis.
That's it,
■
suddenly.
.The * men and
who increased
tion
output
our
factories.
six-fold
muni¬
our
still in
:Jwho
are
The
men
made tne Mulberry Harbours
and
the Bailey Bridges are now1" at
work on other kinds of building.
technicians ; and
scientists
contributed jet propulsion^
who
mined
side,
*
I
*
*
advised the purchase of
four stocks at
so
strong that it
isn't-it?"
penicillin;" radar and early atomic
development to the ' Allied war
effort are still at Work in Brit¬
of
the
take
cah
in the belief that the strike
would
news
and
nomic affairs, even though some¬
times the order is tight and an¬
noying.
r'
That must
be tolerated if the
times
better
achieve in
•to
a
determined
are
we
few years
are
to
was
market
turned
away to a new
the time of
fect ' at
looked
silly when
the. first
ten
a
Waukesha
its
high.
or
A
pretty tight time now,
that later we can spread our-
come.
so
branch out, blossom and
expand.
That
also ;- is
being
planned for.
selves,
of ', them
Many
the V1914-18
of
end
-
remember
the
The
war.
"
much
v scrapping
of
controls,
the
early
too
economic
the
"brighter London" period of hys¬
terical illusion, profiteering, in¬
flation
and
the short artificial
followed by the economic
depression from which
never
really
recovered
in
World
peace
and
trade
world
first
*
$
I
upon
the good friendship
understanding between the
ordinary peoples of the world. 77,
pend
We
have
confident
with
in
faith
|our
in
of the
out
come
with
high hopes for the world, and
with a strong affection for you,
future,
the people of America.
We
were
on
well
we
.
is this reaction that becomes
We
got
together.
We both did
to help each other
v We'll
remain
good
boom,
all
smash and
in
we
friends and good allies in peace.
miserable
those
the
of
business.
British
the
British have no
repeating that silly
•
that's
Well,
between
The
wars..
intention
years
are
same
how
I
think
looking at things—in
determined spirit as
democratic
our
tradition.
They don't ask the United States
to follow the British example
neither
sume
do
to
I.
tell
We wouldn't
the
United
John H. Heminway to Be
I. M. Simon Partner
V
States
John H.
in
I.
M.
Fourth
Simon
Street,
members
of
9L
Stock
Loujs
pTiltori :
will
&
•
the
Co.,
St.
partner
315 North
Louis,
New
York
Exchanges.
retire from
ship in the firm
a
on
the
Mo.,
and
Mr.
partner-
same
STOCKS
glance, the
a
>7
tually
listed
on
vir¬
stock
active
every
the N. Y. Stock and
on
7 Curb Exchanges
«
•Monthly highs and lows for
the past ten years
^•Earnings
W,
dividends
and
,
1936
since
77:
7"
•Capitalization of each
com-
7::pany.777f:77 7
•
,;■:,
'
of trading
Volume
in
cer-
tain important stocks
'
'•
7. -L77^7r-- 7.".
••
V-; (Spiral Binding)
L
January Issue (160 pages) $10.00
Annual* service'
''«
1' 7
IF.
77 ^ ^
(6
S50.00
issues)
A], l' ^ ^
7'f ',, U; f-\>
V"
W. STEPHENS
15 William
St., New York 5
Telephone HAnover 2-4848
LAMBORN & CO.
99 WALL STREET
NEW YORK
buying
5, N. Y.
at this
♦
We can't give
tomorrow's
you
£'•:nv7 ;7'7 '.•Vyy'**,•
vV.7
stock
■yO";'.- \ .Z V
^
prices
;4;
.
.
'»
.
,
>
■/■*■•■-
SUGAR
Should, however, the stocks
recommended
last
come;! available
week
be¬
before the
I advise
Exports—-Imports-^-Futures
next column appears
'•
today
...
BUT...
Pa-eific Coast
can
give
you
the
•
next
best
thing. An implementation of human
judgment
that
investment
sions.
Not
Not Dow
will
help
Theory.
to
make
you
ra tio.
Refreshingly,
We
know
feel
about
sure
it.
)»' ,v
V..-' "■
date.
•:
deci¬
-
"Volume-Price"
scientific.
want
today.
will
and. speculative
a
:
new,
Orders Executed
H. Hentz & Co.
Member*
Pacific Coast
Exchanges
you
Proprietorship
BOX 51-A, CHEROKEE STATION
LOUISVILLE, KY.
York
Chicago
New
York
Stock
Orleans
New
Members
A Sole
York
New
New
Commodity
Schwabacher & Co.
& ASSOCIATES
York
New
Write
DYSART
1856
on
There is. no obligation;; '-,
PAUL
Established
.Securities
Heminway will acquire
the
New York
Stock
Exchange
membership of Webster Tilton on
Jan. 17, and will become
any new
good
•Charts and statistics
assay is still some time away.
But it is definitive enough to
against
point.
with
these
following:
a
practice it made little
sound,
the
they faced Dunkirk, the air-raids,
and all that, and in accordance
with
could
war.
for
■;;''
as
and 321/£ with
warn
We
,
allies.
good
And
are
off
DIgby 4-2727
powers,
own
the
war
walk
to
run
Once, the first burst of buy¬
recom¬
stock-
your
GRAPHIC
"7"';
#
desk
customers
provides, at
by Thursday
Friday of this week. \
*
>
reasons
course
sillier
and social progress will de¬
and
it.
you
The
spirit and strength of the
people will speed their re¬
covery.
On out'' national recov¬
ery rests to a great extent the
recovery
of
Europe
and
the
liable
■
writing,
even
Motors.
mended it
33 }/z
minded
offerings
read ing is accomplished the usual
procedure is a dullness fol¬
point mistake in lowed by some reaction.
It
them. To make it
I made
to your
otherwise
can
the momentum will have
up
British
world.
♦
|| CHARTS
be
Obviously! the prices71 had
given, while they were in ef¬
actual
and, now, a victory.
war
I
Over 900
market is
no
■
there must be order in their eco¬
•
Chain this Book °f
take all
offerings at the first
A buying momentum
flush.
specific prices
But
now.
buy between highly important* If stocks
a stop at hold within a certain zone,
And
the
answer
was:
"Yes,
29.
When I wrote it I must with dullness
that's right, Herbert.
increasing as
That's how ain.
we look at it.
We can take it. ■A: From General Eisenhower and have been thinking of some¬ they approach the lows of that
Tedder
through
the
7 And when we're strongervin the Marshal
thing else. For when it ap¬ zone, it can be assumed that
air we'll give it to the Jerrys, too ranks, the comradeship of Amer¬
peared in print the prices main trend 'is still up.
If
—many times over."
And it was ican and British soldiers, sailors
and
airmen
has
been
welded were 21^2 and 22^, stop 19. certain
so-r-Bomber Harris saw to that.
stocks, usually the
under fire of battle.
And the Anybody who is familiar with
leaders, start eating into these
A New Order That Is ^Tight and
ordinary men and women and the market must have real¬
lows, while secondary issues
Annoying"
children of America and Britain
ized it was a slip. But
slip or are still strong, the signs point
'And now in January, 1946, this who share a language, books and
The final
fine
British people know that even films, have also shared a not, the damage was done. In to a breakdown.
;
,
-
when the
*
People don't change their char¬
The
.
.
enough to with little trouble. Evidences
keep stocks from going up of absorption of such offer¬
have themselves worked af the and
give readers the chance ings are seen in volume of
factory bench or the coal face, or to
You saw that Satur¬
buy them. You know what sales.
like me, as an errand boy ; and
States and Canada.
1
When I went to see the bombed shop - assistant.
And I am confi¬ happened. The column hadn't day, Monday and you are see¬
dent that British democracy is
areas and talked to the people in
even^ reached the
printers ing it today (Tuesday). I think
good cross-seption of the people
and
many
of whose members
it splendidly and your sticking it
will be one of the factors in de¬
•
.
•
a
They—
And
trouble, I said, "You
v
news
with the police, the firemen and
the Civil
Defense Services—did
and fire.
*
Ever since the strike
hit the front
pages I warned
that its market effect would
rent action the
any unsettlethe case last week.
When I for sale at the old 1929 lows
labor-management
sat down to write last week's which started at approximate¬
dispute is during the prelim¬
column I saw evidences of a ly 197.; Of course this figure
might be destroyed. j
/
inary stages, that is before a
turn.
How would the people take all
When this turn would doesn't
represent the ulti¬
strike occurs.
And; that once
this horror and anxiety?
We
It goes up about an¬
blossom out into an actual mate.
the strike is on the market
couldn' ibe sure.
We made the
advance was
obviously im¬ other 160 points. Whether or
best provision we could for them
not the market is
and
assumed
that they
would how to conduct their economic possible to say. But the signs
strong
I'm just explaining how were
stand firm under cruel
enemy affairs.
important enough to enough to take it all is some¬
bon\bardment by high explosive bur brains are working at this warrant
re-entry on, the long thing that needn't be deter¬
their last
might be
■
both will point to next move.
a
evening
Every
too.
darkness
'
had
Ireland
Northern
Wales,
rough time,
when
—.By WALTER WHYTE-
and Minister of Home
One of my duties at
recom¬
"the
question is no mendations, I repeat: Buy
longer what, but when. The Baldwin between 33-34, stop
what is important
during the 31V2. ..Buy A. M, Byers be¬
begininng stages of a rally. tween 24 and 25; stop 23. ... .
The when comes to the fore
Buy Flintkote between 35 and
when the
rally gives signs of 36; stop 34. The last stock was
ending. I'll be frank and tell Waukesha Motors which
you that on the basis of cur¬ should
be
bought between
Home
as
269
*■
.
,
as
then
FINANCIAL
gives it only casual attention. difference for even if it had
buying keeping in mind that
1 did,
however, point out that been printed
correctly the the stops also are in effect.
a
majority belief might affect general advance took it above
the price structure, even if the
buy prices.
—
\-.
.7
For those not familiar with
only temporarily. Yet despite
Tomorrow's ;:
were
we
St
p
faced with the immi¬
was
danger of invasion, when
gravely short of arms
"
COMMERCIAL
T HE
And
,
•
1
\ l-
-
Exchange
Curb
Exchange
Cotton
Exchange
Inc.
Exchange,
Board
Cotton
other
Exchange
'
Stock
of
Trade
Exchange
Exchanges
(Associate)
New York Curb Exchange
Chicago Board of Trade
14 Wall
COrtlandt
Private
San
N.
Street
7-4150
Wires to Principal
Francisco
Monterey
New York 5, N. Y.
Teletype NY 1-928
—
—
Santa
Oakland
•Fresno
—
7;£
Y. Cotton
Exchange Bldg.
NEW YORK 4, N. Y.
Offices
Barbara
Sacramento
CHICAGO
DETROIT
GENEVA,
PITTSBURGH
SWITZERLAND
CHRONICLE
THE COMMERCIAL & FINANCIAL
been
w—
r,
(Continued from page 242)
crease of earnings is allocated ^
or more to the consumer and tfs or
less to the investor.
3.
Equalize competition
between
publiclyutilities. Especially equal¬
and
privately -owned
owned
ize the tax burden.
Let
4
;
;
_
scientific
impartial
an
.
Brookings Institu¬
tion or the Harvard
School of
Business digest and coordinate the
vast amount of material, wluch
body like the
supports these
in the files of the SEC, in jne
briefs before the courts, and in tne
records of the utility companies.
recommendation^
An
5
pointed to bring a fresh and un¬
prejudiced approach, and Jo pre¬
sent recommendations in the in¬
terest of the public.
Utility Holding Company
Act of 1935 and its administra¬
Public
tion?
facts show
The rates
ing companies. But the
that they are benefited.
;
-
consumers or that the
of the Act benefited the
the
passage
consumers.'
;
-
•
,
beep tlie effect on
the
investor?
The "death-sen¬
tence" clause requires liquidation.
•
.
B. What has
Liquidation means sacrifice. Com¬
pulsory liquidation prevents real¬
izing fair values. Abundant proof
is availabe.
Stocks of companies
;
'
split from holding companies were
scid to the investors at low prices,
and
thereafter rose sharply., in
was
it less
under government
so
disintegration.
; <
urgent
more
But does the
in+paratp?
Under the Railway Act
of 1921,
126 rail-
the British consolidated
roads into tour, to the great
^
.?.aasf 1"lu
tu YY;
»
out-Bolsh£vik the Bolsheviks?
we
Yet the
Treasury lost revenue
through SEC policy. Income taxes
dividends and interest of for¬
on
merly privately-owned companies
disappeared.
taxes are no
of
value
nies from the holding companies,
Corporate income
longer paid by com¬
publicly owned arid
Treasury receives smaller inheri¬
problem of access to cheap
technical managerial service will
become important.
It is already
f"the
tance taxes because of the collapse
in the value
problem for municipal systems
intermittent con¬
sultation with private firms.
The losses to over a million
a
which rely upon
run
into
shrinkage in revenue is $120
millions, as conservatively esti¬
mated. This is equivalent to the
amount paid by several million
billions.
moved
death-sentence
no
affected
"The
is not
taxpayers in the lowest brackets.
The income-tax payers in the low¬
est bracket are financing a cock¬
eyed SEC policy which is not in¬
tegrated with fiscal policy;
Over 2,000,000 people in the
.
lowest income tax
pay
order
an
dissolution
«
to
brackets must
Treasury in
the cash with
to the
furnish
which the Federal Treasury sub¬
sidizes publicly-owned utilities.
clause
.
for
revenue
order
Is it ethical to burden
utilities, the utility stocks
proportionately with the
industrial stocks.
in
The
Depending on the index of share
prices
used, : whether Standard
:
Statistics, Dow-Jones, or the New
York Stock Exchange, and de¬
pending on the interval, whether
beginning in 1925 or 1930 or 1932,
the loss, as of the summer of 1943,
$ comparing utilities and indus¬
trials, varied from a conservative
$3 billion to perhaps $6 billion.
But on the London stock market,
where
of utility stocks
estates of decedents.
Who makes good this vacuum?
>
stockholders
taxpayers
in the lower brackets of income to
benefit consumers of electric cur¬
-
rent
who
***
may
be in the highest
order against a holding I
l/JL
.
*
*
'
bene-
7™ I trial iv hriririrriri Vi
*
worked
has
SEC
~,o
some
j despite
I against
utility companies. s
are !
few
punished for the sins of a few
speculators.
These
stockholders
innocent holders for value and
being punished by retroactive
legislation. They bought when the
practices now condemned were
are
regarded as legal, both by the approval of State commissions or by.
public
ownership
continues.
In municipal elections the
vote is running 2 to 1 against publie ownership. Though municipal
electrical utilities increased only
800,000 KW from 1938 to 1944,
Federal power projects increased
from 1.5 million to 5.8 million KW
or
3.9 times,
The "death-sentence" is
| toward public ownership.
the silence of Federal bodies.
The SEC is reorganizing solvent
Tedera^fd
Federal aid, ®to
the S
trend
of
are
numerous.
Chairman
a
..
left
utmties
te
intrastate
r^.Ap
parently the SEC is
1
day dreams or sleep-walking—
u
_
.
sentence"
clause
Chamberlain
Joe
1882.
in
goal
of local
ownership and local management, just as the Public Util-
ity Holding Company Act of 1935
did. What was the result? Chamberlain's work
proven .politiand was undone
after fifty-five years of error. In
cal
was
poppycock
826
companies
electricity
in^ Great
there
1937
supplying
Britain
were
California;
than
smaller
area
—an
There
a
was
com-
plexity of voltages and other factors so that on the opposite side
London it was
impossible to use the same vacuum cleaner, toaster or lamp. Villages near big cities were without
of many streets in
"To
service.
this
end
chaos
the
governmentproposed to divide
country into thirty
areas, in
cvuuujr
^
which
the
existing
companies
would be consolidated."
the
wits
,
.
Electric
the
in
as
u-
hind
«?tt
KWH
tial
bottle¬
War.
Royal ' Commissions
chaos.
resulting condi¬
Britain lagged be¬
TiniM
vitals
States
United
the
a
World
First
the
denounced
tions
was
power
in
in
tne
the
United biates in. t e
per capita, also in r^sidenlighting costs and in capac ty
tncity
A
series
of British
elec-
studied Amercompanies. American
company
officials were
commissions
ican holding
holding
invited
to
testify.
Are
going
we
step
Cases
K.
ti.
back to Joe Chamberlain in 1882?
is neither beneficial nor necessary.
m,
.1L
The theory of the
Peterson, of the Wisconsin Public tasy.
„
Securities and
and
th? ?ecu»tiea
I
Commission
vu
mmtoiw ,
q
„ower
f->«.
Supporting facts have not
d
a
K„ht litiiitv*?
Onr
vice ^ePMedB^.Jrrt^h
Sg comTanies in
:
.
.
govern-
appointed a Committee on
Electricity Distribution. The Britrecommended
committee
ish
a
plan of consolidation, but with
government power of compulsion.
The country was to be
to
divided
number of
limited
a
m-
districts,
Municipal
plants
and
private
plants were to be merged into one
system. Municipal companies were
to be paid on the basis ot pnysicai
assets, but private companies w re
to be
^compensated also ^ for the
loss of prospective
pn>uts^for the
franchise^ Earnings arm
life of
of
rates
the
consolidated
sys
to be based on a sliding sca e
were
profit-sharing between conand, investor,
ject to revision. An advisory comhiittee representing the utility
companies was recommended to
cooperate
with the
of
sumer
Commissioners.
In May, 1937, the
Prime Minister recommended the
compulsory consolidation of elec¬
tric utilities.
;
public utilities of the
United States ought to be consoli¬
dated.
Under the law in Section
D. The
the
Act, Congress ordered
the Securities and Exchange Com30
of
integration
|gnored this
jq years. Should
Qf. ^
mission to prepare an
d
t
for
over
ma^te
ror o^v
not
V^ng
s
_
Qnpp?
dereliction and defiamje?
Yet,
been
early
the
y
^
^
integrated.
in_tne
days of the industry, there
n
AAA
small power sys¬
when the holding-
were
about 2,000
tems.
By 1935,
company act
vnautay*
was passed,
pa&acw,
+ ^j
the
in;
mv.
...
oKnuf
world
Regional
vmam
-
er, increase
and better
-----
-
the integration,
+bA
sf.C has beea
the SEU nas oeeo
■»
.
safety for the investor,
the
serve
publi<j in¬
terest.
V
What
must
be done? The Act
should be revised.
A. It was drafted In an emo¬
tional atmosphere. It followed exp0SUre 0f shocking breach of tru§t
jn important quarters. Such mal-
feasance cannot
under the
recur
jaw
The legislation was hasty.
in four months a strait-jacket was
pUj.
0n
industry
an
evolved
over
that
had
two generations. By
contrast tbe investment trust
legisIation of the SEC took four years
and is fair and constructive.
Th|
,
h
not
foJio years.,
veaTs
merce
been revised
The lnterstate Comxne interstate com
Act was revised 38 times iri
56 years; the Civil
Service Act,
62 times in 60 years, and the Fed¬
eral Reserve Act 17 times in the
first 10 years, and 51 times in 30
years.
But the Public Utility Act
has never been revised.
B.
Congress
suspend
should
Section
11,
promptly
the
disinte-
gration clause and order a thorough investigation of the fantastic
theories and ruthless practices of
the SEC in administering the 1935
^:
The
scientific
fessor
M.
H.
analysis of Pro¬
Waterman
of
the
University of Michigan should
be
checked by an independent
body
of
experts, like the Brookings In¬
stitution.
If
his
facts
are
con¬
firmed, the SEC administration
,
i
•
dustry was concentrated in about working in an unreal
a score of toMing companies. In- have been
cock-sure
stead of imnrovi""
'
things that are not so
.
in-
the electric power and light field
would undoubtedly
VVU.J,J
AAtVAVUMV
increase.* VUj.*
effi•
—
ciericy, lower costs to the consum¬
„
^
utilities had aireaay
partly
^
*f
the British
1935
C. In
i
W
Exchange
w.|^xcuaii&c
.
^^sylfemfs taemlst effi-
ment
Then
set up the
—
#
ply A=t
,,TheActof19 6setup
the "grid
This was an oia ae
.enguieers
we dld
The British enacted a "death-
^
a^telephone utllitj? I
teiegraph utility, and to an elec-
.
administrative somnambulism.
H
to
is^ptannedvThei movei to
1926 m the Electucity oup
gan in
Since
will be^ without
oM^egtajer company
utilities
A. The "death-sentence" clause
a
the
to
States do not regulate public
factor.
P?'1tcy bas toster,end„Pab"
AVi
itself out oi:
companies
and
,JE'
companies without tne
r\f\r\
_
There will be no interstate
job.
ioldtag
Thereafter,
stockholders
U Ti
+
M.V
'■"Avvtv«Artir\eiS%
-1--
-
but against its security | th
pavins for it
Security
holders
ire 7 K ?£?n ' ,
.
chiefly small people. From 80 to
90% of the stockholders own less
1923 Se
than 100 shares in a representa- ! h
declined sharply
Since 1038
tive series of industrial railroad i
company,
of
V* MMJT
even
neck
holders."
Millions
already
^u°afinth*public^
No element
in jtually
Briton"woSd"retur'n
^tto"oid
tag company. Thetwo-story
Integratedtold.
Bell
chaos- The i°b was a brimant Per"
operates 6,200 exchanges
formance in
above
above
_
namely stockholders
owners,
has
on a
and Telegraph Company. It covers the entire country. It is the ,top
holding company. Though its sub->,
sidiaries are now chiefly operating companies, they are also subholding companies having operating'subsidiaries.
The American
Telephone and Telegraph Cornpany also owns the Western Electrie Company, a manufacturing 7
subsidiary, which is partly a holding company owning 30 subsidiaries.
Thus American Telephone
and Telegraph is still a three-story
holding company in part though
ta the course of time it will even-
T
diversification and
panies now
management.
The therefore tax-exempt. The Treas¬
large investor in his own person, ury receives no individual income
can realize these two benefits. The
taxes on dividends that used to
small stockholder cannot.
If the be
paid, but payment of which
SEC separates operating compa¬ was checked
by SEC policy. The
are
aegis?
"write
ud"
write-up
hnff
huge
Is
integration
than
Federal tax can
outbid any private buyer for a
utility splinter, chipped off from
a holding company.
They capitalthe tlx savings.
The'property
a
justify disintegration.
cedent
Is
Cities paying no
sents
came
nation-wide basis
one type of public-utility holding
holding
company, the American Telephone
inateiy and mantel ligently the
contingent clause; without inquir.
whether*! thef conditions pre-
prices
of securities of private
companies and then public
corn^
panies buy the property and it
looks like a rescue party.
In Wall
Street this is crooked tactics.
integrated,
mjnistering the law flouts the abr
golute order of Congress on integra^on
and presses indiscrim-
change Commission depresses
"death-sentence" c 1 a u se
a
decline in the rate of
supervisory
.
"death-sen-
cost as a
The Securities and Ex-
rate base.
The British
.
of the holding companies.
The "death-sentence
destroys
.the
30, Congress issued an
order to the commission on inteordered
gratjon
This
is
unconditional,
unequivocal, and absolute. But
gectiori 4^ on' disintegration, is
conditi0nal.
Yet the SEC in ad-
historical
reject
United States.
Section
ro
Power
Yet State commis-
tence" clause.
sions
the
sen^ence'? ciauSe is revealed in the
legislative conception with
25 companies, but the tale~^~
period 1934-1938. In the increase cost. But the SECjC-onnives at it. and in cooperation -between in- pendents operate 12,000 exchanges
of generating capacity, the ratio This
write-up is -then written | d
{ v and government.
with 6,200 independent companies.
of private to public expansion of down;
by
issuing
tax-exempt
Securities of the old small Brit- There is no comparison whatsocapacity decreased from over 14 bonds in payment aifd thus cheat¬ ish railroad
companies were ex- ever ^between these two types of
times from 1920-1923 to less than ing
aaas
the Treasury a --v.
second time.
changed for those of tliTnew large telephone companies m efficiency, |
The
once from 1934-1938.
taxpayer gets^whip-sawed
syste^s< The basis was earnings, service to the consumer, safety to
D. The SEC in its administra¬ coming arid going. But he does The British
ignored original capi- the investor and value to the
This scandal tal
tion has ignored the sensational riot know it yet.
investment, reproduction costs P"2ilcincrease of taxes on utilities. The should be publicized'sby Congress, and
0ther
absurd
conceptions
The United States has also anF. Administrators "are legislat- which have been befuddling util- other completely integrated pubFederally-owned utility proper¬
ties pay no Federal taxes.
The ing. The Securities and Exchange ity and railroad law in the United lie-utility holding company on a
municipal utility properties pay Commission is writing laws. Con-, states for three generations. Earnno taxes, either Federal or State
gress sets no standards in the Act.
jngS constituted the basis of amal- Union Telegraph Company. A speor local.
Yet since 1934 Federal The discretionary powers of the gamation. Back in 1844 Gladstone cial law was passed to authorize
taxes increased about $400 million.
SEC are too broad.
The edmiri- rised not cost, but 25 years' earnthis+integration It absorbed the
This is equivalent to an additional istration of the Act shows a gov- ings as a basis for government Postal Telegraph
Company, The
rate reduction of 15% by private eminent not of laws, but of men. purchase of the railroads.
After Western Union, though chiefly an
The
SEC
is
not
regulating, but is an efficient railway system was operating company, owns 538 telecompanies only. The tax collector
beat the SEC to rate reductions, managing
the utilities, without established, regulation of British graph corporations, of which 33
but the SEC hasn't waked up yet. responsibility to the stockholders.
Railway rates in the Act of 1921 are still corporate entities.
Its
In the Soviet Union, the Dniec
The
of
was dewas based on a sliding scale.
VJT
*X
UC aim
CtllXl
Of subsidiary, the American District
G.
The
aim
oi the
i e law,
i
j
prostroy Hydro-Electric plant pays feated and the SEC utilityllivision
increased profits, 80 % was Telegraph Company, is a holding
a 40 % corporation income tax to
may end its work.
If the;SEC in used to reduce the rates and 20% company having operating subthe government, but our
TVA pressing for disintegration suc¬ was to be added to the capital, sidiaries. Therefore, in part Wgst"Few British railway men would
pays no Federal tax.
Why must ceeds in breaking up
ern Union is a three-story holding
the'systems
value, benefiting new speculative
purchasers and freezing the losses
of hundreds of thousands of for¬
mer
under
American experience. In the United States there are now a dozen
"grids" already, of which several
are larger than the British "grid",
The idea was borrowed from the
paradoxes, and here to study it.
confbc^s jn which it is entangled. ■ & The United States
ing machinery.
Ancient costs are
used as a basis for exchange of
securities
abuses did
They have been
corrected. To protect consumers,
investors and public, holding companies need not be destroyed.
f The weakness of the «death_
company
jnconsjstencies,
part of its wreck-
as
and
the- industry
miscalling it integration. ^■;=> *
The British "grid" is based on
,
proved that the holding companies
hurt
Commission
A/,
-
subsidiaries of the holding companies are lower than the
country's
averag^ The
Utility Holding
Company Act
brought no benefits to the con¬
sumer.
The SEC briefs never
the
for
t
Federal
eaerai
tne
the
Uses
uses
jaiiuaijr
disintegrating
~
been the effects
■V. on the consumer? The Act assumes
that consumers are hurt by hold¬
At What have
'1
it
So
growth of private generating ca¬
pacity from an annual average of
5.7 million KW in the period of
1920-1933 to 1.6 million KW in the
the effects of
The
Exchange Commis-
sion is not authorized to set rates,
program.
The
public ownership.
Sppiintips and
averaged
This de¬
about $700; million
search
The
equivalent to a good-sized public
works
caused
III
What have been
of
cline
agencies Thus
wfll
abettea.^
for, historical cost
oublic
to
increases
A
tack, new construction
$150 million per year.
nractica 11 y
are
niThlio ownership
ownershin will be
public
be abetted "
annual construction was
above $650 million.
For the nor¬
mal period 1923 to 1927, it was
$830 million. In the years 1934-5,
when the utilities were under at¬
high-minded, disinterested pub¬
lic-spirited citizens should be ap¬
stated "Sales
AlUi&Udy,
exist in the past.
Holding
—-—
n nm ert v
v
limited
average
outstanding committee of
utilft.
of
—
Commission
cjprvipp
The "reorgani¬
zation" of solvent corporations is
iuthorized by no law. It is based
in fanciful interpretations.
Have
stockholders no rights?
Can the
3EC destroy contracts?
Millions
of American citizens are victims
of the fantasies of the SEC staff.
C. What has been the effect on
the public?
The public was not
benefited but hurt.
The "deathsentence" clause checked utility
expansion.
From the years 1919
to 1932, including two panics, the
the stockholders.
Trie, "when and
presented.
if" clauses have not "been proven,
Wanted-\ New Federal Policy on Utilities
■
X
t
of
-t
is
t
inanv
savs Tpr
ome Frank in "The Law and the
163
Volume
''
THE COMMERCIAL & FINANCIAL
Number 4456
Modern Mind." Prof. Fred
imhis book "Woe Unto
Rodell,
You Law¬
yers," stated that administration
by Commission should be "brought
before engineers or accountants
who
could
apply the ■ technical
knowledge to an examination of
facts and claims and make intelli¬
them.",
gent choice between
•
:>
enforce Sec¬
Section 11. Section
30 remained unchanged, in all the
drafts of bills preceding the final
draft, but Section 11 was changed
frequently. Senator Wheeler urged
integration
gefore
distintegratibn.
He said "Holding companies
are given five years to arrange
Congress should
C,
tion 30 before
their own way, and
is directed to aid
such arrangement on a voluntary
their
affairs
the Commission
basis".
stated
Representative
that
30
Section
Rayburn
"de¬
was
signed to promote information, to
as a basis for reorganisa¬
serve
tion," and stated clearly that inte¬
gration was to precede disinter
gration,
Integration
■
is
in the
implied
wording throughout Section 11.
Both Section 11(a), and Section
11(b) mention "an integrated pub¬
lic utility /system "
".Section 30, near the end, ex¬
.
presses
"The
the dominant note:
Commission is authorized
and di¬
and inves¬
tigations of public-utility com¬
panies; upon the basis of such in¬
vestigations and studies the Com¬
mission shall make publicr from
time to time its recommendations
as to the type and size of geo¬
graphically and economically inte¬
grated public-utility, s y st ehis
which; having regard for the na¬
rected to make studies
But, if Section 30 is enforced first,
then Section 11 becomes an effec¬
tives means of
Ouv Foreign
compelling recalci¬
companies to co¬
271
CHRONICLE
Policy—Courage
or
Chaos
j' itation and side-stepping that has fairs, I hope you will realize that
operate in integrating.
. *; 1
his mind bluntly runs the risk of characterized our diplomatic deal- it is because the spectre of poings ever since. As a result, Rus- litical
disintegration
dominates
But if we effect regional inte¬ being called alarmist, or of failing
sia suspects
us
of playing her and overshadows economic reality
gration into
12 or 16 regional in his purpose. But a career of
in
the
minds
of
most
thinking
holdingcompany
systems,
we a quarter century
which ,\has against England, the British hint
men
today. Indeed, the race is
shall enjoy efficient management, forced my close attention to every darkly that we plot Empire dis¬
waxing furious between state con¬
lower costs, acceleration of rate cross ;; current
in
international integration, there has been a nearscandal
over
our
relations • in trol forced by continued leftist
reductions, and service to inter¬ waters, forbids me silence at a
tendencies in politics, and the en¬
time when plans are being pre¬ China, France is sulky, and small¬
spersed rural communities.
i
er
nations stand appalled at our terprise system, which up to now
! All first-tier holding companies pared that may set the pattern of
apparent abdication of supremacy. has given the world whatever it
would become regional or geo¬ world development and behavior
has achieved of progress. Tempo¬
..
1
graphical systems, and would in¬ for many years to come.
rizing with the trend," comprp;fv UNO Meeting Clouded
clude, as in Britain, all public and
It
is
in
such
an
atmosphere that mising with totalitarian doctrine
i
Foreign Policy Confused
private companies in the region.
that hides behind the name of
the first meeting of the Assembly
Much of the indifference toward
The
second-tier holding compa¬
democracy, merely evades the is¬
of the United Nations Organiza¬
overseas
problems
which
exists
in
nies could become investing com¬
sue.
It
does
us .little
good " to
tion will be held in London be¬
this
country
is
due,
I
think,
to
panies, either specializing in utili¬
ginning Jan. 10—this week. As if thunder at Argentina, while we
ties as in British, Swiss or French ignorance of what Our foreign
confusion regarding the role the permit our former allies in Eu¬
investment: trusts, or- else they policy is or should be.
Not since United States will play there were rope to violate commitments in
might be required to reduce their Cordell Hull developed the Good not enough to cause uneasiness Iran with impunity. Our derelic¬
Utility holdings to some fixed per¬ Neighbor doctrine for this hemi¬
throughout the
world, Russia's tion now will rise to plague us
Mr.
Roosevelt decision to send a delegation of later. The people of the United
centage after several years. The sphere —which
new
senior securities would be merely
proclaimed —- hasthere secondary officials is concrete evi-, States have no wish to interfere
convertible
into common stock been a simple; clear statement in dence to all who have learned to in the internal affairs of any
and would disappear as the com¬ the field of international relations
read the symbols of international country but their own, but equal¬
that the average citizen of tut
mon stock rose. A simple capital
communication, of her estimate of ly, they havp no intention of con¬
United States could understand.
structure would thus result.
;
the results of the recent Moscow doning the extension 'of fascism,
The
instant,
nation-wide
accept¬
D. We should scrap our; policy
conference. The London meeting whether of the Hitler or the Len¬
of basing rates on asset values and ance of the idea was a measure
will open on a low note, unless in variety;; * ;
'»
'
idopt the British sliding scale.
It of the power of public opinion the United States rises to the oc¬ ;/ In sharp contrast to the pusil¬
originated in Great Britain in that can be stimulated by compe¬ casion and proclaims, preferably lanimous attitude we have dis¬
1855.
It worked well.
It never tent leadership in foreign affairs. : irom Washington, a foreign pol¬ played
in
the world
political
But official statements recently
was
abandoned.
It was always
sphere is the understanding and
icy statement that will reassert
trant
holding
(Continued from page 245)
:
:
_
1
adopted in Can-, have tended to confuse, rather the leadership we have so nearly resolution; officials at a lower
level have shown in their ap¬
and in more than than clarify, and often are suspect abandoned.
half-a-dozen American cities.
Qf so-called, "double talk."
The
Such a statement would require proach to our international eco¬
releases
after the recent rare political courage because it nomic problems. There are many
Boston adopted the sliding scale hews
in 1905. Louis D. Brandeis fought Moscow meeting of foreign min¬ must deal with questions of which ; of them, but by undertaking a
there is little understanding in solution first of the most difficult
for the sliding scale and; against isters furnished an example. Sat¬
and intricate—our position vis-a¬
municipal ownership. Did he ask isfaction was expressed by State this country, and whose disclo¬
vis the British and the Empire—
would
irk
some
of
our
what was the original cost, repro¬ Department spokesmen over the sure
fact that the Big Four had agreed
Iriends overseas: and their
ad- we have done much to break the
duction cost or yardstick cost? Did henceforth to "act unanimously"
lerents here. Bpt refusal to face log jam of world trade.'Some day,
ae complicate the question by de¬
ture and character of the locality
tails of Valuation?
No.
He had on all questions at issue, which and state our ^position on them I hope, the country,-and particu¬
sdrved, can best promote and
;he practical
approach.
If the was merely another and more pal¬ now, only postpones their event¬ larly business men, will realize
harmonize the interests of the
atable way of saying that the ual solution, and meanwhile sub- how great a debt we owe to Will
fates to the consumer were re¬
public, the investor, and the con¬
veto power in the Security Coun¬ j ects us and the world to contin¬
Clayton, Assistant Secretary of
duced;
the
dividend
to
the
stock¬
sumer."
holder could be raised. "The prop¬ cil o4 the United Nations Organ¬ ued frictions that: may lead again State, and his associates for ne¬
;The law is clear and unmistak¬ er aim of the public must be .not ization
and
soon—to
armed
conflict. gotiating an agreement with Eng¬
had !. been
confirmed
able.
How does the SEC defend
land
against tremendous
odds.
:6 limit dividends but to secure against which 'the smaller coun¬ There aresore spots in many
dts noncompliance? The law shows
tries! represented at the San Fran¬ parts of the.qvorid1 that must be Those of you who closely follas of good quality at low prices.
constructive statesmanship
and
cisco conference have waged a iiealed.; if we .are to have real *lqwed the many meetings that
\ reasonable assurance of undis¬
ithe vision of regional integrated
but'fhopeless battlA peace—the Near East, the eastern were necessary to < compose the
turbed enjoyment of .large divi¬ continuobs
systems,: benefiting the consumer dends might be the ' best method Ambiguous expression has always Mediterranean area* the Red Sea various points at issue, know that
;
and investor and the, public.. But,
suspicion,
and while and Persian Gulf regions, India if it had not been for Will Clay¬
Of attaining cheap gas. *** If ther inspired
the SEC, in its administration
East, to mention ton's vision, patience, persever¬
demand for municipal ownership reassuring words of successful ne¬ and the Far
shows only a lamentable lack of
aan be stayed it will be by such
gotiations between the Big Four some of them. We will never help ance and patent honesty of purappreciation of this- quality of the vise
legislation." ("Business—A came to us from Washington dur¬ to compose the differences that pose,-there could have been no
law.
and
the
economic
ing tlie holidays, reports ; from exist unless there is wide under¬ agreement
Profession", pp. 108, 114.)
Chairman Landis of the ; SEC
other world capitals indicate much
standing of them in this country, foundation for a world divided
The sliding scale is a fruitful
stated m 19^5, ^'Congress has given
less optimism, and some fear that and thus far the average citizen into rigid political alliances would
concept and merits investigation.
"
us two years *** to have a plan to
is aware of them only through the have been laid.
It might solve many problems of principle was sacrificed to expedi¬
i bring abqut economic and geo¬
Make no mistake about it, Will
one-sided exhortation and halfgovernment regulated industries, ency .in attempting to regain the
graphic integration". Similar opinClayton
is
a
very
great
man
in a
prestige we lost in the London truth of the agitator, if at all.
like railroads, utility, telephone,
world thai fairly groans for lead¬
; ions
were
held by Chairman
meetings several months ago.
and;wduldmake rate fixing sim^Douglas in 1939 and Basil Manly
ership. It is a? tragedy, I think,
The Policy Toward China
The fact is that neither we our¬
that he is one of those
whom
of the Federal Power Commission pier, and stimulate efficiency and
selves nor our friends overseas
The flare-up over our policy in
expansion.
Our
public
service
in September, 1936, .According to
Washington considers to be "po¬
seem to know precisely what kind
China only last month is a case
commissions
approved
the
sliding
Mr. Manly, the present demand
litically unavailable" for higher
of peace Washington has blue¬ in
point. Congressional clamor
"£alls for integration on a larger scale in almost 100 decisions, be¬
responsibility.
His
talents
are
printed,if any. The United States finally forced the President to
7 sCale
than has heretofore been cause it rewarded good manage¬
'sorely needed in the wider fields
reached
the
highest
peak the make a public - statement of our
effected • in
this or any other ment; and penalized inefficiency.
of general foreign relations.
No other system basing rates on world has known of leadership on position. It had immediate and
The hesitation with which the
country".
V-J Day. It was an attainment wide acceptance because 'it was
costs pf plant can do so.
British Parliament and public ac¬
The SEC's dereliction on Section
made
possible
by
"know-how,"
specific;
But
even
more
happily,
E. Congress
should reorganize
30
has
brought confusion and
material might, singleness of pur¬ it served notice on China that fur¬ cepted the final terms of the pro¬
Federal regulation of public utili¬
posed loan and agreement has
, chaos
to the industry.
No hold¬
ties.
The SEC deals with securi¬ pose and devotion to ideals. But ther civil strife was useless; and
ing company knows whether its
the cease-fire order had hardly the warring factions are now en¬ temporarily muffled the Britishties chiefly. Suppose in 1935 there
baiters in this country, but when
program under Section 11 will fit
sounded when we began the hes¬
gaged in. round-tabie conference
were
no
ICC.
Would any one
Congress begins its debate we may
any pattern of integration which
to compose their differences, with
think of putting railroad regula¬
expect a resurgence of bitterness
Congress intended and. which the
tion under the SEC?
Why should plant is a fake yardstick. It should General Marshall as their arbiter. that will be concerned more with
SEC was ordered to prepared.
Are we to wait for crises in
it
;
regulate
utilities? The task be made true.
Enforce Section 30 first, and
each"of~the controversies that Pr.eitidice
than with constructive
should be taken away • from the
criticism. Politicians in England
VI
Section ,11 later.
Section 30 beloom? I had thought the period of
SEC and vested in a separate In¬
displayed
unusual forbearance in
What is the obvious conclusion? dramatics had passed, and besides,
; chme
effective immediately; in
terstate Utilities Commission, cor¬
The
1935, but Section 11(b)(1) was,to
utility industry is ham¬ we may soon run out of generals! discussing terms in the agree¬
responding to the Interstate Com¬
ment that will be as hard for
be effective only after Jan.
1,
merce
Commission for the rail¬ strung, and the. country is suffer¬ Secretary Byrnes has announced Britain to fulfill as
they are easy
1938.
But the* SEC iii its briefs
roads.
A separate utilities com¬ ing because* Of ^ an ^mazing com¬ that terms of peace are to be for our critics to
condemn., I con¬
says, "—even a preliminary study mission should be created which is
plex of factors. Investors are un¬ ready for public announcement
***
fess some doubt as tp British
would take an indefinitely
iitility-minded, rather than legal- organized and cannot effectively by June 1st. Far better to state ability to comply with all of the
long time. ^^^ The final task could istically-minded.
It
should - be register a protest or compel ac¬ openly and in advance our posi¬ conditions for which the measure
not ever be completed."
Staffed by engineers and man¬ tion by the Government. The leg¬ tion on problems that are in dis¬
provides within the time limit set,
islators are either too busy with
In other words; the SEC tells
pute than to risk disillusion which
agers, rather than by lawyers. The
but wholesome respect for the
the court that Congress didn't (commissioners should be required international affairs and pressing could easily turn again to isola¬
'*f v
problems
of
reconversion f'anc tion in the one country that is willingness to try.'
know what it was talking about to have
public utility experience.
One of the most significant pro¬
transition, or else they are indif¬ the hope of the world we like to
in Section 30, whereunder_ "The The
only lawyer on the Commis¬
visions in the agreement, and the
envision. Irritated,
one
of our
cpmmission is direction to make sion should be the general counsel. ferent because they lack the facts
one that will get least attention,
They should have the aid and ad¬ officials said recently "you can't
studies to determine sizes, types ,K.
■
perhaps, in the forthcoming de¬
and
locations
of public
utility ; V F. A Federal advisory counsel vice of experts to make analyses conduct intricate negotiations in a
bates, deals with a partnership be¬
of public utility executives should and recommend legislation,
companies".' But Justin Whiting
goldfish bowl." Of course not, but tween the United
States
and
stated that "rearranging the power, meet periodically with this com¬
f r Superimposed on these two dif¬ my answer is that neither can you Britain formed to tear down bar¬
mission, using the Federal Ad- ficulties is a
systems will not be done in- a law
bureaucracy which is conduct them in a dark room and riers which have been built in re¬
suit but in a study by engineers yisory Council of- the Federal Re¬ dogmatic
expect them to be blindly en¬ cent decades to interfere with the
instead
of
inquiring
serve Board as a model.
and- economists,v with
practical
dorsed. That age has passed. An
cock-sure, instead of selfsearching
easy flow of commerce between
informed public opinion in the nations.
knowledge, patience, imagination
G. Congress should tax all pub¬ hungry for power -and therefore
One of the most effective
and constructive spirit".
vr
licly owned utilities, municipal, making new law by interpretation United States would be the most of these bulwarks has been the
It
extended.
ada
in
was
1887,
.
*
'•
•
:
.
;
If Section 11 is enforced first, it
enforce
Section 30.; Indeed Section 30 be¬
j
will become impossible to
comes
invalid,
for
the
Federal
Government will lack the
power
piece together the splinters and
fragments of : intra-sta«,e piai.ts.
to
city,
or
many.
Federal.
The
revenue.
The
reasons are
government
Here is
needs
a new source
of
instead
of administering
the law
Congress intended it. The least
that the situation requires is
as
powerful
could
force
muster at
If I seem thus
any
statesman
the peace
table.
far rather to have
so-called
the
"Sterling
British
Area"
conceived
counter-measure
to
which
first
our
as
a
former
investigation. xxv-v
Let emphasized the political aspects high tariff policy, and later ex¬
just and painless taxation.
>uuwu5u-6v/xxt5
uivv.0H&a^.,
Com¬ thorough-going
petition should be equalized be¬ us have the facts. An enlightened of our international dilemma be- tended during the war years, to
tween
public and private enter- public opinion can then induce' fore a group such as this, inter(Continued on page 272)
ested primarily in economic afprise. The government yardstick wise and sound policy.
./;■/
■ i'*
i
////:••/<
ft/ft
'ft1 ft/' /-/.ftY*.',;i=v,;ft
■'
v
: ,r;..
';:a:ftftft;ftftftftY 7
•'
.
M
772
-/"ft ''/A> .ft/''1"''/'''K
ft" V'' ft"''"'' "ft//' "
• i
ft ft
THE COMMERCIAL & FINANCIAL
-
"■ '
'
' '
TT f/vf"?/
CHRONICLE
-4
this unbalanced
(Continued from
pa^e?*7!lftft'.\
the
permitting
ourselves as a nation to be placed
in the same unenviable position
that we found ourselves after the
that
viction
are
we
are
English and Empire -.rinance. The Sterling Area concep¬
tion threatened seriously to stifle
first world war. Others then pro¬
our trade with many countries not
included in the British Common^ posed peace terms, and having
none prepared
ourselves except¬
/-Wealth of Nations in various parts
ing a nebulous "14 points," ca¬
of the' world—Norway, Sweden,
pable' of various interpretations,
Denmark, Holland, Argentina, In¬
we were at a distinct disadvantage.
dia, Egypt and others. Britain, by
Eventually we found ourselves
accepting the agreement, not only
universally blamed for the fail¬
undertakes to open the Sterling
ure of the peace treaty that was
Area to our trade again, but has
written.4
:
agreed to work with-us in elim¬
The fact is that America has no
inating similar barriers elsewhere,
choice but to assume leadership
a concession that transcends all of
in world affairs. For the weight
the other stipulations of the docu¬
of our influence will be felt by
ment in tangible and potential
other nations no less whether our
benefit to either country, in my
attitude be positive or negative.
opinion.
..V
ft
Y
And the cost to us of any interna¬
protect
In
for
return
this! concession
to
what
ourselves
the
enlightened
the
names
*
ft: whose ft owners
are
as¬
signed to functions other nations
would delegate only to those who
have been tried and proven. If
there must be a
institutions.
ft;
proteges, let it be in fields where
they will not be forced to impro¬
vise when the experts hesitate.
A
The
2.
place for political
v
sufficient number of nations
their adher¬
ence to the Bretton Woods Fund
to assure its establishment. Rus¬
sia
is
a
conspicuous exception
thus
far, doubtless because she
wishes to use her; seeming insignified
have
now
is
that
she
time
needs
plan, together
with
the
development
of - the
British-American agreement, can
eliminate many of the economic
the Bretton Woods
evils
the
United
the
greatest
world has
v
4.
a
carries
with
:
fits
mands
civilization—de¬
enduring structure
peace
and
ft!/ security. The basis upon which
of
'•'V
an
international
such
a
structure
can
most
surely be built is the achieve¬
ment
*
higher
everywhere ft of
living
which all
5.
Y
the
to
t
the immediate effect of
i'i
ft ft."
jj
5
fa 1
I
tvit*
the
f|
;
w
1
b'T*-.!
ftv//
|
A
r.-'
obligations.
Exp.»n*
has demonstrated that
ence
Y! dependence
trade
upon
i
■.!<$
v..
li:
.t
long-term
guaranteeing
...
■
vestments made.
/ft; all private loans arA insesti.ft ments is the creditor $
f
tatioi. that he will receive
Tft; adequate return in his ©w h
US currency. Loans are made
by both imports and
9.
own
our
resources
a',||
motivating force behind
and
fjji'
ii
it a.t
■
exports. Imports, supplement¬
ing
The
13.
t $
ft
ft.
if
g
--.<•*
yftftft y*
T1>i|
Ty,
1
i
111
g
'
ft" only if there appears to be a
/productivity, enrich pur econ- ft
; reasonable prospect for then
fomy;With the fruits; pf |^ Ja^ ft "immediate servicing ard
bors of. others; exports pro¬
ft eventual repayment.
vide an ft outlet for the sur¬
ft'
investments,
involving the
pluses of our farms and fac¬
ftft'S projection of capital abroad
tories, and enable other coun¬
ft for continuing use ai d ptotries to benefit from pur pro¬
ductivity, are also based pn
ductive efficiency, thus en¬
the investor's expectation td
riching their own economies.
fftft obtaining a reasonable
.1
Both
imports and exports
over
the years,
c r eat e
employment
and
14. These principles, under
* profits; they are tangible evi*
mal conditions, apply wit's
dence * of
the
availability 4C.
•"'v'
equal force to governher.t
ft everywhere of the "good bar¬
ft,
loans and credits.
gains" which the skills of
ftfrom these principles in t/e
men can produce.
ft/ft period of world rcct>hstfuc*
The
only theoretical limit
ft; ft tion ahead, whether in 1/ <
upon the importation of the
|| form of loans or outright |,.n>
products of other lands for
so
labeled, can benefit the
the use and enjoyment of the
Y United States only If
American consumer is our
serve *hc purposes of national
ability to pay for these prod¬ : y, security, or if they construe*
ucts with our own goods and
tively promote-world ord^r
services. As a. practical con¬
and
stability by Increasing
sideration, ■: however,
it
is
productivity and opening up
necessary, in our import prac¬ ft
the channels of international
tice, to safeguard our national
ft
trade.
defense and to avoid too rapid
15. An expanding world economy
a displacement of any of our
ft
demands, in addition to an
own
productive ft'ft facilities
abundant flow of goods and
which may be inefficient. The
services among nations, a free
only theoretical" limit upon
and unrestricted flow of capithe volume of exports to be
Y ft tal and earnings internal urn-
Yft/y f/n
ftft/.
hi# r
./.;'/?
t\*
■
.
thit 1
H
;/";//A
y/ft/
,
jhfe
to ty.ft
ft
*" .4
Yft
j*
:j
r: a..
ft' ? "
^4 i*
.-
-4 ill
^
ft///
y
/ft ffij
%
/ftftf.;; t
.%
» ft
Irft
f
i
/"/ft/ IK t / «^ i"
I
>
;
,,.'4
'
sought is our ability to secure
payment for them; but we
must
give account, ' in the
transference of these fruits of
,
'■
Y
,
.ft
■
and sub¬
unduly difficult or costly.
;
.
s
international
World
demanded, as the
has
basis for
an
advantageous ex¬
change of our goods and serv¬
ices for the
:/
foreign economic poUry
of the United States, as the
medium through which
The
16.
government exerts an ir.fia*
the conduct of Ameri¬
can
foreign trade, embrace*
ft (
of
and in the years
of the wide¬
spread destruction of produc¬
tive facilities abroad and the
time required for their re¬
habilitation. Even though our
tain it, in .view
usage
tinues
;
of foreign service con¬
large, and our
tourist
expendiiures increase gro«L.y,
responsibility for safe¬
guarding and protecting the
the
interests
immediately
and services is the
first requisite to a high level
of employment and consump¬
tion, upon which a higher liv¬
ing standard depends.
The
attainment of a higher living
standard can come only from
hard and unremitting ion uy
we
ft
C
4ierr4 I
j;
i,$l
tjV-'fi'C'iitt-vf !■# 4
at'- tfw* fc/. ?e| f;
Co
*4
$*'*-*'<,f
f'i#
|
i|
ft
^
Wat
»r/#|
Wuilrt. At
t.Yif
pmx
|
dm-Sfvt.
||
Wat the i, -a
41
WC
my4^4
t,'||
5c&eff^
A-44 '
way
th®
Krw
'1
iw4
wut
^
II|I
ni\l
rt
of American enter¬
prise abroad through every
political and economic means
cannot hope to at¬
ahead
P
•itr'4 k
pit4 *4 |
|k
at
ence on
goods and services
others, an excess of im¬
ports over exports. This ex¬
cess
has not been attained,
■ft" At
!>••;
ter,
'
creditor since the First
A
ft
blocs, exchange controls, mul*
ft
Our status as an
War
4ft the elimination of currency*
tiple currency practices, bar¬
and the other artificial
restrictions which make the
international transfer of fund*
to
other
conservation of
resources
own
stance.
10.
ally. This can only occur with
productivity
lands, to the
Increased production of use¬
ful goods
figuratively
men
standards
aspire.
trill
If*
created
conferred upon our own
economy
our
our
*•
.
v
■,
'
trade.Recognitionof this^mu¬
tuality of benefit demands
recognition also of the bene¬
This
of
4
.
b
■
up
whole.
f
.
.
consumption of
a
Ui
.
IFi.ttt'O of
,
our
as
r a
n«•*
■
^
inter-
well-being—in fact the pres¬
ervation of the very founda¬
and
barter,
inextricaably with the well-being of
tions
agent the
change and
■
,
%/f
i?
useful goods and services.
The well-being of the United
the world
V
become
giant among pygmiesit political respon¬
sibilities. I have long had the con-
people. of
the
United. States through an in¬
ft/ft States is bound
international
—
the
to
creased -/production,
known.
our
stature
that of
will
financial
ever
Inevitably
economic
States
international
purpose of our foreign
trade itself is to bring bene¬
.
bedevilled the
the past decade,
world
during
particularly in the stabilization of
exchanges, and as a brake on cur¬
rency
depreciation. The dollar
will become the monetary stand¬
ard of world finance, occupying
the
position which the pound
sterling maintained for a century
after the Napoleonic wars,
and
these
in
The
have
that
factor
fit
for
further study. Properly managed,
of our foreign
policy, as a vital
purpose
relations, is to fortify and im¬
plement our foreign policy,
v; and to encourage, in the proc¬
ess, the development df an optimum flow of foreign trade.
3.
transigeance as an additional pos¬
sible bargaining point in future
credit negotiations, .though her ex¬
cuse
economic
fr. rrsvr
.
•
'
security and
well-being as a nation and to
preserve the integrity of our
'
p''#
.
thankless
our
i»f f "ft
5
'!■
loans .and investments m .* 'ft/ft I.. :t
i'i Ka 1.4
YY device to balance % chror k
access on non-discriminatory
ft/,; ir^h.
import deficiency is u?:evo»
terms to raw materials and
'ft
nomic, since al 1 too frequer,x fy
markets everywhere, provides
/ft
the capital invested is M. ft"/-;- t
u-r.f
the most effective means for
f//*
/ft The investment of American
enabling
each
nation
to
ft;'/"
"1',
1
achieve an advantageous ex¬ ft/; capital abroad can be Justus!
only if it facilitates incrcayc ji ■ft/';-- i-l
change of its own. products;
good* Y'ftft b Y « r #ti
for
the products of. others ftft/ production of useful
ft;. and services, and only it %%*:■
Such a multilateral trading
% a*.r.
{
if! in the United States are
system is inherent in the; con¬
t;.e 1:
^ t
and willing to accept a
cept of free, competitive en¬
J,.i KCkfe
|
iHy tion of this increased pwlue*
terprise.
ftW^OU
at J
ftft tion for the servicing ar.d re¬
Mutual benefit is the moti¬
ft
payment of the loans aid .hi- Jftft AfiCJ •:* iit? ,j
vating force that .underlies all
V
h
or
N -
assure
bilateral
of
limitations
accepting or rejecting
they demand of us. Our
to
An. inter¬
States.
unhampered by the crippling
States
bristle with new
:
versal of our export fcaiar.ee
it progressively Increases i/e
;'// need for a greater volume cA
ft/ft imports to service the new:;.
national trading system free
uneconomic
restrictions,
there
announcements
Am
;.
.
a further increase it*
exports. White this \u.l
militate against an early re-
/
of
of
of
of ; the Anglo-United want and are able to mobilize all
agreement.! Having that, their strength to achieve it.
Mr. Clayton will enter the first
This year, 1946, doubtless will
meeting
of ft the p International be One of the most fateful in the
Trade Organization of the United
history of the United States. Be*
Nations
Economic;4 and
Social fore it is ended; we^ will surely
Council in June with a program see the outline of the kind of.
to which all other nations must world our children will live in.
subscribe, if they wish to share Conscious of oun power, military
in the upsurge of world rehabil- and
financial, dare we refrain
ft/itation and development.
ft
from expressing our views openly
Implicit! in Britain's approval ;and in plain terms, so that all may
of the agreement was her adherft know where - We' stand, and take
ence to the Bretton Woods organ¬ .warning?
The timid protest no
ization, over which there has been such statement is possible. That I
considerable controversy. My own deny. The National Foreign Trade
fears
regarding
theft plan ft are Council, composed of nearly a
chiefly concerned with its man¬ thousand members engaged in ex¬
agement, not its objectives. Wash- port and iniport, large and small,
ington has produced in recent whose officers represent every
years so many foreign trade "ex¬ shade of political opinion that is
perts"* whose - qualifications ex¬ not crimson, has endorsed unani¬
clude any experience above the mously the folio wing set of for¬
country* or township level, that eign policy principles:
I do not wonder at the doubts;; 1.
The purpose of the foreign
many of our bankers have ex¬
policy of the United States,
in the whole broad 'field of
pressed. Treasury, Commerce,
our international relations, is
Agriculture and other department
United
self-interest
0
Mi
^
17
4>ur
;
u
ft* < l i^
projection of capital w/4
have
pursuit of foreign trade
policies consistent with these
economic realities is in the
a-itf
qn »•*.(*•
ft
-Yi; inducing
The
7.
principles
;
The
12.
v
.
C»'«
agement.
-
is planned for greatest bargaining weakness
ft/ft early 1 spring a meeting * with stems from the fact that other na¬
twelve additional nations which tions, by contrast feeble in po¬
will be asked to subscribe to the tential power, know what they
Already
••/
international
all
for
;
trade.
.
task
•
own
cation
,
ing
'k
productivity by
drawing upon the productiv¬
ity of others. This recourse t3
advantageous
utilization
of
the
productivity
of
other
lands is the basis and justifi¬
,
ability to obtain our share
benefits that the agree¬
ment can bring about.
"ft.
only if they supplement
their
which we might
and numerous others, we agree .to
in all fairness,
extend a line of credit to Britain,
be weighed against the equally
rather than a loan, and to a set¬
real cost to us of dealing with
tlement of all outstanding Lendmeasures: that others may take
Lease transactions on a lump-sum
;o protect themselves against: the
basis; a small price, it seems to results, of our non-participation.
me, to pay for the opportunity to
We have tended in the past to
plan a period of prosperity such approach international commit¬
^
as; this
country has never yet ments timidly, fearful that We
known.
The
question
is
not
might be outwitted in a world
V" whether we paid too much or re¬
battle of wits. And in so doing,
ceived too little in the deal, but
we have too often ceded to others
rather whether we have the will
the initiative Of suggestion, leav¬
and the
V
quate^ resources and tech¬
niques are lacking, the peo¬
ple of any land will attain
their maximum living stand¬
ard
beneficial basis, twee.a* *
rily involves more than the
exchange of exports for tm»
ports.
If the productivity i f
other lands is to be rapid ijr
expanded, thus increasing the
benefits we derive from the
exchange of our products far
theirs, our participation wiU
involve, inevitably, the pro¬
jection abroad of Ament&n
capital, techniques, and man*
ft
.
.
America's participation in in¬
ft
avail¬
that ade¬
able. To the extent
tional obligation
undertake must,
ofv the
and techniques
sources
if
f
t
«
V' ally
-
.
#
t
ternational trade, on m rr.utu-
effective utilization of the re¬
■
ft
ucts.
11.
■ill
^ +*
importation of both raw r< a*
ft/ft terials and fabricated fivi*
/
V1
t*'
.
!
Living standards in different
lands will vary widely with
the ability to achieve such in¬
creased
production through
6.
,
.
•ft*'
people themselves who
seeking it.
/'/vftft/Y'
condition win
continue until, over the tw ger term, the trend i* r*\wed
through a vastly itmiubuM
1;
or
Qui Foreign
/ft;
j]
<vj|
i|
government's disposal
This responsibility lie# in the
f, 15 ff
a
area
of assuring the *Afct> f$i
and security of foreign invest¬ Vs-h W a - i r
■$ j
ment against confiscation or
(ft--"..,•••<
!|
discrimination in any form; u
I
"t f/'
.*4 bt
'tj
ft;lies in the area of seek if g t-'e
at the
lift L * M11
Z
,
THE COMMERCIAL
m
& FINANCIAL CHRONICLE
this unbalanced condition will
•
Our Foreign Policy—Courage or
permitting
ourselves as a nation to be placed
in the same unenviable position
viction
(Continued from pp rte 071)
fi¬
and .Empire
English
protect
The Sterling Area concep¬
nance.
that
to stifle
our trade with many countries not
Included in the British CommonSvealth of Nations in various parts
of the' world—Norway, Sweden,
tion threatened seriously
that
-
are
we
•J
then pro¬
first world war. Others
terms, and having
none prepared
ourselves except¬
ing a nebulous 3 "14 points," ca¬
pable. of various interpretations,
we were at a distinct disadvantage.
posed
peace
:
Area
to
our
trade again, but has
agreed to work with-Us in elim¬
inating similar barriers elsewhere,
a concession that transcends all of
choice
stipulations of the docu¬
tangible and potential
benefit to either country, in my
the other
in
ment
opinion.
ment
can
early
the
there
spring
a
additional
battle
which
planned for
meeting - with
other
all
to the Bretton Woods organ¬
ence
ization,
over
which there has been
considerable controversy. My own
-fears-
regarding
the
plan
are
chiefly concerned with its man¬
agement, not its objectives. Wash¬
ington has produced in recent
years so many foreign trade "ex¬
perts" whose qualifications ex¬
clude any experience above the
country* or township level, that
be
do
not
wonder" at
world
owners
in
to
to
sia
is
establishment.
Rus¬
cuse
3.
she
needs
time
for
the
r
of
4.
development
of the
the world as a whole.
This
British-American agreement, can
well-being—in fact the pres¬
eliminate many of the economic
ervation of the very foundaevils that
have bedevilled the ,7y tions of our civilization—deworld
during the past decade,
;.
mands an enduring structure
of
particularly in the stabilization of
international
peace
and
exchanges, and as a brake on cur¬
security. The basis upon which
such
a
rency
depreciation.
The dollar
structure
can
most
will become the monetary stand¬
surely be built is the achieve¬
ard of world finance, occupying
ment
everywhere
of
the
the
position
which the pound
higher
living standards to
which all men aspire.
sterling maintained for a century
after the Napoleonic wars, and
5.
Increased production of use¬
the United States will
become
ful goods and services is the
the greatest financial agent the
first requisite to a high level
world has ever known.
of employment and consump¬
Inevitably
our
international
tion, upon which a higher liv¬
economic
stature — figuratively
ing standard depends.
The
that of a giant among pygmies—•
attainment of a higher living
carries with it political
standard can come only from
respon¬
sibilities. I have long had the con¬
hard and unremitting ton oy
.
all
conferred
upon
our
for
outlet
an
American
the
.
our
our
own
consumer
resources
stance.
is
'
Our status
and
as an
international
has
demanded, as the
advantageous ex¬
change of our goods and serv¬
ices for the goods and services
of others, an excess of im¬
ports over exports. This ex¬
cess
has not been attained,
and in the years immediately
ahead we cannot hope to at¬
tain it, in .view of the wide¬
spread destruction of produc¬
an
tive facilities abroad and the
time
required
for
their
re¬
habilitation. Even though our
in
return
por¬
his
desires
of
the
people through a
abundant foreign comis '"evi'able that
confronted, in
ou„Cept^diffei:ent
from
These differences
th=t"rgeTSty in the
years that lie
years
ahead. It is in
the cherished tradition
of the
American people that we hold
to the
principles that have
Sat
4^?a^°" great' and
Stinn
n wV;du.aIs
as a
nation, we
be guided a«d
bv
t
as
„
FernsThat
r" Swing
lems that he
before the prob"
us.
principles, under nor¬
mal
conditions, apply with
equal force to government
Can'-i>e
in
substitute,
m th«re
the pursuit ofno
the ends we
have m view, for the
initil!
Deviations
til
these
principles in the
period of world reconstruc¬
tion ahead, whether in the
form of loans or outright gifts
so
labeled, can benefit the
United
States
only if they
serve
purposes of national
security, or if they construc¬
tively promote world order
and
stability by. increasing
productivity and opening: up
the
materials and the markets
the
American people need;
Dies
o?liilar-statement
Princi-
sS&SSpsas
»eetinSs-!
would go far to
|
An
resourcefulness of
t
dividual
,thou.sands of in-.
nllt
who th*>
go
out l^
m Lenterpi'isets
the world to find
channels of international
trade.
Of
nessimkm
„„a
eck the wave
noar-despair
expanding world economy
demands, in addition to an
that has
abundant
Sprain
flow
of
goods
and
services among nations, a free
and unrestricted flow of capi¬
tal
settloa
and
earnings internation¬
ally. This can only occur with
13
our
will
whighC°nfU?S
?nd
difficulties
must
be faced,
and
the years.
from
15.
we
manv
lands, with national economic
an
the
elimination
of
eals we expressed
2,
currency
when
".4 blocs, exchange controls, mul¬
tiple
ter,
currency
and
the
restrictions
practices, bar¬
other
which
artificial
make
the
.
international transfer of funds
'
3
unduly difficult
16.
or
costly.
Scheffmeyer Partners
Sc"Offmeyer & Co
26 B
<.
The
foreign economic policy
of the United States, as the
3 medium through which the
government exerts an influ-
3-3
ence on
the conduct of Ameri¬
foreign trade, embraces
responsibility for safe¬
guarding and protecting the
can
the
interests
of American
prise abroad through every
political and economic means
at the government's disposal.
•This responsibility lies in the
area
of assuring the safety
and security of foreign invest¬
tinues
discrimination in any form; it
against confiscation
lies in the area of
nws,2and
Eliabeth
jITL"* 3 ]imited>-'ner
on
enter¬
ment
expenditures increase gi,>
and
shall be
own
usage of
foreign service con¬
large, and our tourist
wants
These
loans and credits.
sub-
creditor since the First World
War
.
economic sphere out¬
weigh the advantages of pri¬
vate trade and the freedom
of
the market place.
In seeking fulfillment of
the
Loans are made
only if there appears to be a
reasonable prospect for their
Immediate servicing and
eventual repayment. Equity
investments,
involving the
projection of capital abroad
for continuing use and pro¬
ductivity, are also based on
the investor's expectation of
obtaining a reasonable return
over
14.
our
/$
basis for
.
or
.
productivity f to
other
lands, to the conservation of
10.
policy in the polit¬
ical
currency.
our.
•
gency, or when considerations
of national
motivating force behind
private loans and invest¬
adequate
pro¬
transference of these fruits of
■
a
an*
missible only in time of war
or other
international. emer¬
able
tation that he will receive
sur¬
ability to pay for these prod¬
ucts with our own goods and
services. As a practical con¬
sideration,
however,
it
is
necessary, in our import prac¬
tice, to safeguard our national
defense and to avoid too rapid
a displacement of any of our
own
productive
facilities
which may be inefficient. The
3 only theoretical limit upon
the volume of exports to be
sought is our ability to secure
payment for them; but we
must
give account, in the
33
willing to accept
the doans and credits
mmmS10n
in international
commodity agreements,
is ad¬
ments is the creditor's expec¬
own
only theoretical limit
the importation of the
products of other lands for
the use and enjoyment of the
,
The
13.
upon
States, is bound up inextricaably with the well-being of
are
industry.
ln.t0 foreign
ot
more
The
useful goods and services.
The well-being of the United
the United States
the inter¬
hdttiincluding
trade ac¬
tivity
the, extension
t
a
vestments made.
efficiency, thus en¬
riching their own economies.
Both
imports
and
exports
create
employment
and
profits; they are tangible evi¬
dence
of
the
availability
everywhere of the "good bar¬
gains" which the skills of
men can produce.
the
as
chronic
a
trade.
the
tries to benefit from
-
investments
or
The actual entry of the
gov-
American
is
ductive
9.
that
long-term
upon
^s. distinct from any
est of any individual
payment of the loans and in¬
benefit
pluses of our farms and fac¬
tories, and enable other coun¬
foreign
^
sectional interest
moti¬
vide
security and
nation and to
people
in
•
unani¬
have its only
justification in
the service of the national in-
investment of American
and
productivity, enrich pur econi"omy with the fruits of the .lar
'■
bors of : others; exports- pfb-i
of for¬
international agreements—can
capital abroad earn be justified
only if it facilitates increased
production of useful goods
and services, and only if we
by both imports and
exports. Imports, supplement¬
ing our own resources and
purpose of our foreign
trade itself is to bring bene¬
the
The
to
arising from Ameri¬
participation in private
can
re¬
balance
to
of natural
and the prevention
ot abuses
will
import deficiency is uneco¬
nomic, since all too frequently
the capital invested is lost.
and
economy
United, States through an in3 creased
production,
interchange and consumption of
further study. Properly managed,
the Bretton Woods plan, together
with
military
refrain
The
to
nation
conservation
resources
•
vating force that underlies all
fits
relations, is to fortify and implement ; our foreign policy,
and to encourage, in the proc¬
ess, the development o*f an op¬
timum flow of foreign trade.
fit
each
.and
device
recognition also of the bene¬
purpose of our foreign
economic policy, as a vital
factor in these international
.
materials
Recognition of this mutuality of benefit demands
%'
The
\
a
that
as a
-
2.
far,
is
our
loans
and guaranteeing
non-discriminatory
raw.
jn
the imposition of tariffs,
the
tion of this increased produc¬
tion for the servicing and re¬
Mutual
8.
the integrity of our
institutions.
conspicuous exception
doubtless because she
wishes to use her seeming intransigeance as an additional pos¬
sible bargaining point in future
credit negotiations, though her ex¬
thus
.
preserve
signified their adher¬
the Bretton Woods Fund
its
r
international relations, is
assure
to
dependence
trade
an advantageous ex¬
of its own products
for
the., products of. others
Such a multilateral trading
system is inherent in the con¬
cept of free, competitive en¬
terprise.
States,
broad afield of
whole
well-being
sufficient number of nations
assure
the
our
,
to
we
crimson, has endorsed
mously the following set
eign policy principles:
1.
The purpose of the
policy of the United
proteges, let it be in fields where
they will not be forced to impro¬
ence
power,
dare
not
vise when the experts hesitate.
have
in.
terms
f? 2i?n trade—as for example
;
export balance,
demonstrated
has
ence
achieve
port and import, large and small,
whose
officers
represent every
shade of political opinion that is
t
A
our'
financial,
will live
take
.warning? The timid/protest no
such statement is possible. That I
deny. The National Foreign Trade
Council, composed of nearly a
thousand members engaged in ex¬
signed to functions other nations
would delegate only to those who
•have been tried and proven. If
there must be a place for political
now
children
know where-^ we^ staridy land
as¬
are
our
of
on
in the regulation of
"V-
progressively increases the
need for a greater volume of
imports to service the newly
created obligations.
Experi¬
of
inter¬
bilateral
our
framework
a
ment and support.
The inter¬
vention of the American gov-
,
it
change
po¬
kind
the
of
barter,
enabling3
from expressing our views openly
and in plain terms, so that all may
of our bankers have ex¬
pressed. T reasury, Commerce,
Agriculture and other department
announcements bristle with new
whose
Outline
Conscious of
and
many
names
the
versal of
markets everywhere, provides
the most effective means for
history of the United States. Be¬
it is ended we will surely
doubts
the
or
access
of
t
further increase in
a
„our exports.
While this
militate against an early
be
2 government law and treaty
designed to give it encourage-
American
of
best
can
terprise within
The projection of capital will
have the immediate effect of
12.
the
self-interest
States. An
abroad
trade,
j
:
capital, techniques, and man¬
uneconomic
limitations
fore
see
jection
make
carried on under a system of
free, private, competitive en-,
the
agement.
providing
will
; ?
products for
our
barriers
Vur foreign trade, like bur
'
domestic
rapidly
from
derive
we
inducing
in
be
to
of
area
possible the receipt of an ade¬
quate volume of goods and
services in return for our exports of goods aqd capital.
,
17
theirs, our participation will
in vol ver. inevitably, the pro¬
:;
is
is
exchange of
3
trading system free
restrictions,
unhampered by the crippling
of the most fateful in the
one
United
of
world
doing,
in
realities
lands
benefits
national
strength to achieve it.
This year, 1946, doubtless will
v
I
the
their
program
nations must
Britain's approval
her adher¬
in
contrast feeble
justifi¬
trade, on a mutu¬
expanded, thus increasing the
international
:
enlightened
of
by
all
-
economic
power, know what they
want and are able to mobilize all
if
,
a
1
pursuit of foreign trade
policies consistent with these
commit¬
that we
so
;
The
to
tions,
in the upsurge
Implicit
in
peo¬
land
for
trade.
tential
a
of the agreement was
And
lacking, the
any
other
of
conditions .which
exchange of exports for im¬
ports. If the productivity of
tech-
elimination
in the
ally beneficial basis, necessa¬
rily involves more than the
•
stems from the fact that other na¬
which
they wish to snare
of world rehabil¬
itation and development.
1
subscribe,
•
7.
must,
wits.
are
cation
ourselves the thankless
accepting or rejecting
what they
demand of us. Our
greatest bargaining weakness
,
to
of
niques
ple of
and
lands is the basis and
the initiative of suggestion, leav¬
ing
is
June with
in
by
have too often ceded to others
we
principles of the Anglo-United
States
agreement. Having that,
Mr. Clayton will enter the first
meeting
of
the
International
Trade Organization of the United
Nations
Economic
and : Social
Council
weight
felt
■
approach international
ments timidly, fearful
might be outwitted in
task
to subscribe to the
will be asked
be
We have tended in the past to
agree¬
nations
the
less whether our
no
results of
bring about.
Already
twelve
that
For
will
affairs.
influence
protect themselves against the
our non-participation.
;o
small price, it seems to
to pay for the;opportunity to
plan a period of prosperity such
as - this
country has never yet
known;
The
question
is
not
whether we paid too much or re¬
ceived too little in the "deal, but
rather whether we have the will
and the ability to obtain our share
benefits
leadership
which we might
in all fairness,
be weighed against the equally
real cost to us of dealing with
measures
that others may- take
a
the
our
undertake
; me,-
of
world
of
resources
the
;'?gainst
American goods; and
it lies
v/,;
-
ternational
techniques avail¬
quate
stimulation of American ex¬
ports through efforts to-secure
America's participation in in¬
11.
their maximum
;
„
assume
ucts.
:
re¬
will attain
living standard only if they supplement
their
own
productivity
by
drawing upon the productiv¬
ity of others. This recourse t3
advantageous
utilization
of
the
productivity
of | other
•
treaty that was
tional obligation
,
,
:,
be positive or negative.
And the cost to us of any interna¬
return
basis;
t
attitude
for." this concession
and numerous others, we agree to
extend a line of credit to Britain,
rather than a loan, and to a set¬
tlement of all outstanding LendLease transactions on a lump-sum
In
in
to
other nations
:
•
but
33"
able. To the extent that ade:
The fact is that America has no
■
and
sources
.
of the peace
written.
>
'1 •
ure
people
effective utilization of the
Argentina, In¬
dia, Egypt and others. Britain, by
accepting the agreement, not only Eventually we found ourselves
undertakes to open the Sterling universally blamed for the fail¬
Denmark, Holland,
until, over the long¬
term, the trend is reversed
through a vastly stimulated
importation of both raw ma¬
terials and fabricated prod-
,
6.
.
continue
er
themselves who
are seeking it.
Living standards in different
lands will vary widely with
the ability to achieve such in¬
creased
production through
found ourselves after the
we
4
Chaos
the
Thursday, January 17, 1946
or
seeking the
MP°"*Trry
Scott Ada»ts
PHILADELPHIA,
PA. —Mont-
Broa^Street"
& C°" 123the New
Street, members
road
of
York and
hanges,
rdt to
Philadelphia
will
admit
partnership
Stock Ex-
Frank
on
Feb. 1.
M.
Volume
Number
163
THE COMMERCIAL & FINANCIAL CHRONICLE
4456
Wanted: Revival oi Science oi Goveinment
government—has not kept pace.
needs
velopment
The science of government
new answers.
I
present to you tonight a plea.
is
better fitted
than the
"Who
members of the Bar,
by education,
by training, and by experience to
play a major part; in that search
for the new answers, for the ad¬
vances in the science of govern¬
ment of free men?
will
It
of
formation
involve
committees
of the addi¬
tional special problems by members of the profession through the
years., It will require many hours
of time and of thought.
\
on
many
.,
;
The American Bar Association
its members have, already
and
made
significant
very
tions in this matter.
contribu¬
I wish to-
"night to
trib¬
Sim¬
mons, for his constructive and in-telligent
contributions
to
the
pay a very earnest
ute to your President, David
United Nations Conference at San
Associated with Mr. Simmons,
Judge Ransom and Judge Hudson,
made very significant con¬
tributions.
And your Section of
also
^
International
Cooperation
and
Comparative Law has been out¬
standing in its consideration of
many of these new and vital ques¬
tions.
In
the
considering further
domestic
matters
of
some
that
need
answers, I want to say first
that 'we all recognized that with
the limitations of the United Na¬
new
Charter which
tions
was
drafted,
also knew the importance of
we
making a start.
We knew that
banding together the. United Na¬
tions as a continuing organization
for peace, with the right objec¬
tives, was of fundamental import¬
We realized that the first
ance.
"priority must be that of making
this start, rather than of seeking
too much and failing to start at
-And
all.
now as we see
the fact
with
the rapid development
of this United Nations Organiza¬
that
tion, so that we can look forward
'just to, the 10th of January a few
days off, to the actual beginning
the first assembly, we recog¬
nize that the United Nations Char¬
ter and the United Nations Or-^
of
ganization is truly
the
amid
clouds
period.
a
of
star of hope
the
postwar
.
/
.
Problem of
•
-Taking up
Slum; Clearance
brieflysome of tHe
domestic
aspects of these' prob¬
lems that require new answers, I
should like
to
emphasize that it
is difficult to believe that
a
coun¬
try that has the industrial in¬
genuity and the skill of work¬
manship that America has should
have so many of its people living
in unfit housing and in slums in
our
great
cities,' and - that we
should have such
an
extreme de¬
ficiency in housing at this time.
A
preliminary
examination
would
seem to
indicate that one
of the real difficulties is that the
very desirable separate ownership
of each individual tract of land in
our
of
cities makes
blighted
areas
a
redevelopment
by private cap¬
ital almost
ess
of
impossible. The proc¬
original development of
beautiful
ties
by
suburban
areas
and
enterprising capital
ci¬
and
jurisdictional clash be¬
a
tween
unions
tation
of
a
the
over
group
available at
ahead.
reasonable ppce
a
for
unions
between
•
in
the
years
The strike is not a
'
suit¬
redevelopment by private capital
enterprise in a manner com¬
parable to the original developr
able
and
tween unions
ment of the cities of America?
■■•Sy
new.
precious jewel of all the world is
sideration.
a
These
include
»the
methods
It
well be said that the most
can
idea in
new
by which a truly inter¬
national police force might be es¬
men.
tablished and supervised.
that to
is involved with management.
for
weapon
tion when
struggle
a
be¬
their jurisdic¬
economic problem
over
no
;.
•
The essential jurisdictions
over
worldwide
answers
which
will
not
unwisely
infringe to too great an extent a
burden upon the existing national
and governmental structure. Each
should be the subject of alert and
continuous study. .
'
,
We also find that many of our
cities
have
archaic \ ordinances
y
that
prevent home building and
general construction from taking
advantage of the advances in sani¬
tation, ; fire protection, and in
other facilities. Through these or¬
dinances
city
governments
of
generations ago are handicapping
the homes of the generations of
Is there not
tomorrow.
a
need for
the
Some unibns
handicap
have rules which
tion
of
the
efficient construc¬
in large numbers,
depriving their fellow
homes
living condi¬
that management and
Mr. Gregory and Mr. Carroll, and
ly
the
better
political^science for
government
free
of
ground
decide
ing amount of jurisdictional strife
rule
-
neces¬
peoples might make steady' prog¬
ress, and raw materials would be
equitably available. All these need
.
and playgrounds and facil¬
ities, and then make these tracts
ways
that will fairly place limita¬
on
the type of restrictive
problems, just as it
is in domestic problems.,
urgent
the clash of economic strife. There
tions
/in world-wide
an
is every, indication of. an increas¬
swer
That
is
sity.
Many other international
problems need high priority con¬
quire large tracts in our blighted
ac¬
Francisco
Conference.
exercised
drawn,
from various studies
precedents, but yet definite¬
and
areas/ contract for clearing them,
establish a plan for modern high¬
possible new
Should Government
answer?
thereby
United Nations
be
could best
energy
sure,
No other group: can bring to the/
search and study a better back¬
a
workers of the better
tyypically Texan direct and forth¬
right manner was very effective
atomic
of
was a new answer,
be
with nations under state capital¬
ism can be increased.
Dependent
clue to
a
representative
of
the
^American Bar on that historic oc¬
San
can
stable, con¬
structive, democratic,' responsible
and strong.
/:
It would appear that a tribunal
should be developed to - decide
jurisdictional disputes. There is
now * no. really
effective way to
trol
con¬
of employees,
except either their own decree or
Is that
and constructive. He was indeed a
the
unions
be
to
in which the;
air
travel
could
be
initiated. Multilateral world trade
basis to the original development
of our cities.
intelligent interest in the. entire
proceedings* His advice was broad
of
which
on
confidence
world,
manner
represen¬
comparable
any
for the congested cities of Amer¬
ica?
casion
basis
ing. It needs revision. The search
for the
..My plea to you tonight is
an increasing measure
you
engage' in the search for these
precious jewels for the benefit of
the people.
-
on
among, ; the
consultants of the
American delegation; He remained
worthy
..
total lack of rede¬
a
your representative
as
there personally for many weeks
and took a continuing, alert and
.
been almost
drafting and preparation of a
modern model building ordinance
Francisco
„
the
with
promotion
is
well
% With the exception of
some very recent and significant
experiments at one of the large
insurance
companies, there .has
*'
-
ingenious
known.
(Continued from page 249)
Aug. 6 tne atomic bomb was
dropped, revealing that science
had made
a
further new and
amazing advance.
Government — the science of
on
273
tions,
Can
will be
we
find
new
a
an¬
labor
permitted to apply? ;
I should like to
Dynamic and Stable Economy
•There
tee of th^
other. far-reaching
problems of a domestic nature,
which need initiative and analysis
are
for their solution.
the
that
We $11 know
dynamics
of
our
free
economy-has been its grelrt asset,
but that also these dynamics are
a
of
Tsource
considerable
a
amount of instability and of fluc¬
commit¬
a
see
AmericarlJBaif "Associa,-;
tion visit the
other
major
coun¬
tries of the; world promptly, now
that the war is over.
I should
like to see its members spend a
month in
a.
Russia, in exchange for
similar
committee
jurists spending
country.
a
I should
of
Russian
month in! this
like
to
see
a
fresh
The tendency in times of
analysis of the systems of
jurisprudence
used
in
various
high production and high employ¬
parts of the world determine the
tuation.
is
ment
credit
for
conditions
to
paths by which the various judi¬
cial codes might meet in a United
reduced, because the money Nations code for
specific, basic
is coming in easily, and for other
human rights.
stimulating effects to multiply.
And how much there is a need
Then, on the other hand, when
for an emphasis upon the im¬
employment and production begin
portance of basic human rights in
to drop, there is a tendency for
the world of today and of to¬
Credit to tighten up, interest rates
as
we
look back
to rise, taxes to increase in rate, morrow, for,
and other depressing effects to upon the tragic beginnings of this
war, we recognize that it did not
become
generous, for taxes
more
to be
.
appear.
when
start
Hitler
first
marched
.
.
confidence
that
America
can
Government, the government of
filid the way, in keeping with, the
basic American system of a free
free people, never has been static
at the time that it has made its
building homes
quantities for the people.
economy,
of
in
Industrial Strife
The current
strife
and
scene
of industrial
the
very grave effect
continued major stoppages
which
of production, particularly if they
great contributions to the world.
It has been stimulating,
it has
been finding new answers, but
Linding them consistently with the
basic liberties and rights and free¬
doms
of
the
people who are
served by that government.
That study of the problems, the
members of the
Bar, by their
training and their viewpoint, and
steel industry or
industries, can have
upon
our; entire - economy
and
upon the standards of living of
our
people, clearly indicate the
need of new answers,, in the field
proach
of-labor relations.
face the
spread
other
to
the
basic
The failure of the Labor-Man¬
agement Conference, and the na¬
tural human limitations when one
is too close to
a
clear that
need the interven¬
we
their whole wide range of obser¬
vation
are
so
exceedingly well
fitted to provide the kind of ap¬
that
is
so
needed
as
we
problems that. arise
developments of the
Scieftc^s in ; othdr/respects, in the
new
the
from
domestic field.
Obvi¬
chanisms is too obvious to need
these, should be.hew an¬
swers
which
discussion at length, and you have
shown Such an awareness
maintain
the
great
;to' it in
strength of the American system
with its free workmen, its private
capital, and its individual enter¬
prise. ;; It would appear' that one
of the major problems is to pro¬
vide the legal and governmental
background for the development
and maintenance of strong, sound,
responsible labor unions, under
the
whole work of
on
International
able
the
leadership, keenly interested
America, and at
the same time maintain high pro¬
ductivity, good profits, and de¬
velop
increasingly
constructive
industrial leadership which never
loses sight of the human relation¬
ships of the employer and the em¬
ployee. ;
•
>:
in the welfare of
We need
the
a
fresh examination-of
legal
Relations
Comparative Law,
ried; forward
of
a
information
this, respect.
you
to
We
people in
recognize full
well, of course, we are not talk¬
ing entirely about two separate
problems
when
we
world
problem
They are so closely inter¬
twined that a healthy American
economy can reflect and be of
and
in" the
through
converse,
happen. 4n the world
so
cant
have
start
made
in
the
a
their
weak¬
now
ments,
that
toward
but
the
these
everyone
United
velopment.
very
United
is only a first step.-
clauses.
the world,
things that
reflect
quickly back into America.
We
i"njr»n
and their strengths, to find
speak about
and the do¬
mestic.
significance
signifi¬
Nations
develop¬
recognizes
Nations
find
you
tradition
of
knowledge, more of
disinterest, more of a
service, more of es¬
sential stability than the American
Bar. Your thanks for
finding these
new
will
answers
mankind.
from
come
all
■.
Individuals Hold $181 fs
Billion of Liquid Assets
(Continued from page 253)
holdings
by
individuals, liquid
assets held by other non-bank in¬
vestors
mutual
tions,
insurance
•companies,
savings banks, corpora¬
associations, and govern^
—
mental
accounts
also
—
reached
peaks at the end of 1945. Al¬
together, non-bank investors now
own $296
billion of liquid assets.
new
This is
over
—an
increase of $214 billion
held six years ago
an
the
total
increase
related
directly to
in
around the
laws
and
and
man
world the
statutes
worldwide
and child under
woman
whatsoever flag he or she might
be found shall be respected, and
to seek
throughout the world an
understanding of the background
of history and of economic condi tions, and of geographic position
from
which
each
nation
thinks
and acts—seek those dCfnite laws
and rules and mechanisms of gov¬
ernment
which
must
be
estab¬
lished, based upon the. good faith
of the peoples of the world, if we
are to have peace and progress in
common
Charter
It needs de¬
It needs strengthen¬
the large wartime Federal deficit
During
Federal
welfare.
the
six
last
the
years,
Government
spent
$365
billion in
all, or a little over 35%
of
the
aggregate
expenditures
made by everybody in the coun¬
try. In the same period, Federal
taxes brought in $156 billion, thu3
covering about % of Federal ex¬
penditures. This corresponded to
about 15% of the equivalent gross
income flow
arising out of . aggre¬
gate expenditures in the couridry;
As
a
result the
ment had
Federal
Govern¬
deficit of
$209 billion,
equal to about! 20% of the gross
-income flow, while everyone else
as a group had equivalent
liquid
savings. It was this large volume
of liquid savings which was re¬
sponsible almost entirely for the
$214 billion increase in liquid asr
sets during the last six years.
>
and
agreement that the rights of every
About
billion
a
two-thirds
into
went
of
this
Federal
$214
secur¬
ities,
while the remainder was
placed in commercial bank ac¬
counts and currency; It could not
be expected that all. of the. $214
billion would have been invested
in Federal securities,; nor would,
that have been desirable. A large
of the wartime increase in
savings represented either
legitimate expansion 6f business
working capital or an expression
of a positive savings preference
by" individuals, rather than a
temporary accumulation of funds
to be spent at the first oppor¬
tunity.
To the extent that these
part
money
a
.
savings were genuine; say¬
ings, they did not encourage in¬
flationary pressures! even thou^^
they were not invested in Federal
money
securities.
nent
lawyers of the land should
give continuing study and atten¬
tion to the methods by which this
government; on the world level
might be evolved and developed!
in keeping-with the problems of
the atomic age.
I
car¬
the
Charter
shon
have
and
splendid/program
ramifications that are
involved in labor relations, of the
maintenance of membership and
nesses,
Section
your
freedoms
The committee of the most emi¬
ously,
answers.
of
What is needed is
reaching to the point where you
can describe in
language such as
the
As to the worldwide problems,
the need of developing new me¬
new
advance
human rights.
Worldwide Problems
thinking on behalf of the
people as a whole.
We. need
of the
problem/ make it
tion of
of
constructive
.
We need an analysis of those
Everyone agrees that housing is
across the borders of the adjoin¬
methods which can be used ? to
one of our primary social and eco¬
ing countries.
The
war
really
nomic problems.
The partial so¬ reduce this instability and the started when Hitler
began to crush
wideness of this fluctuation while
lution of them will have a major
the human rights of the people
effect
upon
the health of; our retaining the basic dynamics of within his own borders.
the
competitive American free
economy and upon the health and
We need the searching, sym¬
living standards and stability of economy.
our people.
It is in the analysis of problems pathetic, earnest. approach 5 to the
It needs high prior¬
other nations of the world as to
ity consideration on a broad basis of this kind upon • the domestic
by leadership such as the Amer¬ scene " that/ aif1* see- if/ the great the;r0trte^by wvhich we can agree
on the specific statements of basic
ican Bar can furnish.
provision of the law, represented,
human rights.
implemented, stimulated through
The basic facts are there.
We
The
United
Nations
Charter
the great American Bar Associa¬
have- the productive ability, we
has a splendid statement in it on
have the raw materials, we have tion, can be of tremendous service
the
broad
bases
of
the
objectives
the skill oft workmanship. We join in the years ahead.
in
v
of
should
like
to
see
thousands
members "of
the legal profes¬
sion: continue to contribute con¬
stantly in their own communities
informing the people of the na¬
ture of the problems and focus¬
ing
their
attention
upon
the
means of solution, as I am. sure
you join with me in a very great
to
confidence in the decisions of the
people of America when they
well informed and have
tunity to
I plead
express
an
are
oppor¬
those decisions.
with you tonight that to
an increasing measure the Amer¬
ican Bar give the type of leader¬
ship in the years ahead that the
lawyer gave to the community in
the early period of our history.
The very Constitution and form of
government which has had; this
tremendous value to us, and to the
To Head Curb Div.
For Veterans Fund
.
;
Frank E. Herma of 120 Green¬
wich Street, New York
City, has
accepted the chairmanship of the
New
York
Fund
Curb
for
vision
of
the
the
Veterans,
Exchange
National
Disabled
according
di¬
Service
American
Charles
to
Shipman Payson, chairman of the
board
Sugars,
Refined
of
who
Inc.,
the
Fund
Edwin Posner, Presi¬
Chairman.
dent of the New York
change,
and
Syrups
is
will
serve
Curb Ex¬
honorary
as
chairman.
Through
Fund,
its
with
East 42nd
National
Service
headquarters
at
41
Street, New York City,
the DAV is
conducting
a
campaign for $10,000,000.
national
THE COMMERCIAL & FINANCIAL
274
CHRONICLE
Thursday, January 17, 1946
"It has been
Sees''Coasting"
The Economic and Moral
On Tax Refunds
i
(Continued from page 253)
est."
'
Mr. Evans pointed out that "al¬
though no excess-profits tax is
payable for taxable years which
begin after Dec. 31, 1945, Con¬
gress deemed it advisable, after
careful consideration, to retain
that part of the excess profits tax
relating to the carry-back of the
unused excess profits credit, for
one year beyond the repeal date
(Jan. 1,1946) of the excess profits
tax. This makes it possible for a
corporation to carry back such a
credit arising this year. The car¬
ry-back would have to be applied
operations and then
if any, to 1945. Ac¬
cordingly, any corporation in such
first to 1944
the balance,
a
situation would be able
the
duce
.
amount
of
to
re¬
its v excess
profits tax for those two 'past
years and get a refund after 1946.
*This
he
added,
corporations
which have a high average base
period net income for the excess
profits tax. However, larger re¬
funds will be obtained by those
"will
.
provision,"
benefit
many
corporations which have increased
period profits by recon¬
structing their earnings in accord¬
ance with the relief provisions of
Section 722 of the tax laws./
t'There are a number of poten¬
their base
tial
wherein "abuse "of the
cases
provision may result or may be
encountered,"
Mr;
Evans
ex¬
plained, and added: "Despite the
fact that organized labor's leaders
claim corporations can make more
money by not producing or man-?
ufacturing, because they can, carry
back their unused excess profits
credit in 1946, we know that this
■Jis absolutely fallacious. It is hard-
^ly conceivable' tbat any corpora¬
tion executives, who are respon¬
sible
to
stockholders and
direc¬
the
public interest,
try to make money,
assuming it could be done, by
•tax-coasting' or relying solely on
excess profits tax refunds result¬
ing from carry-backs. After all,
the primary objective of a corpo¬
ration is to produce goods at a
profit. Consequently, no legiti¬
mate corporation would jeopar¬
dize its good-will, its markets, its
consumer "relations,
etc.,—all the
things that form the basis of ad-;
vertising—for a few tax refund
dollars. This is especially true of
tors,
would
and
ever
,
•
#
(Continued from page 243)
-
was
stand
urged that, under such circumstances, the
free to act
as
a
dealer.
This
when
argument cannot
/
realistically viewed and tested against the ►
provisions of the Exchange Act., Section^ (a) (4) defines?
Aspects oi "Disclosure"
^
'public utilities,' such as electric
light and *ower, communications
and rail transport, which, through
rate-fixing by the Government,
are regulated in the public inter¬
firm
t?rm.<broker' as>ny person engaged in/thd business;
p£ effecting tran$actions iri,^securities ;ior;the; account/of ft
;
others.
not by any accurate measure, but by the higgling and bar¬
gaining of the market, according to that sort of rough equal¬
ity, which, though not exact, is sufficient for carrying on the
»
A firm which makes
a
purchase to fill an
by it when it knew it did not have the
securities on hand is
making that purchase for its cusitomers—in fact and within the
business of common life."
meaning of the Act. Such
a transaction
What does the "higgling and bargaining of the market"
is, therefore, a brokerage transaction under
the statute, and it is a
mean?
brokerage transaction apart from
the fact that the
It means, that under competitive conditions in a free!
particular; customer may be (as was true
in this case)
market, buyers and sellers, each respectively and individu^;
especially reliant on the firm by reason of
ally, seek to sell or buy at a price which will give each the / particular trust, confidence, or infirmity. ' Under these
circumstances the firm must fulfill the
greatest profit in exchange. It means that buyers as against
obligations of
sellers, and vice versa, must keep each other in ignorance of
brokerage in the transaction; among other things, to res¬
their respective strategic positions. It means, therefore, that
train from acting
adversely to refrain from taking secret
neither buyer nor seller should in any way disclose his re-;
profits, to make the best deal for the customer at the
spective position with reference to the exchange to the other,? -best price obtainable,1-and1 to confirm as - agent making
so that the seller should not know what is the highest price
specific disclosure of the amount t)f its remuneration/ Ip
that the buyer will pay, or, contrariwise, the buyer- should
transactions such as we have outlined the firm
placed
not know what is the lowest price at which the seller would!
itself in a brokerage position and it could not choose to
be willing to part with the article or property under negotia-:
act otherwise.
Nor could it relieve itself of the necessity
.
order solicited
•
tion.
under the statute of
Of course,
each participant in 'the bargaining process;
seeks, through "higgling," to obtain this knowledge from the;
other. If the knowledge is made available to one or the other
of the participants in every bargain, there would be fewer
exchange transactions and the whole fabric of competitive;
markets and "fair prices" would disappear.
Why would competitive markets disappear?
The reason is plain!
There cannot be a free market if a buyer has the advan¬
tage of knowing that the seller is pressed to sell, and, there¬
fore, will accept a lower price than normally, and, vice versa,
the seller, if he is informed that the buyer?s position is such
that he is willing or obliged to buy, he would, in view of the;
situation, demand a higher price. Under such conditions,
there would not be at the same time and in each bargain
both "willing buyers" and "willing sellers." There would be
no equality of knowledge or of ignorance, which puts both
Thus, there is nothing
parties in a "bargaining position."
that creates What economists call "a normal equilibrium of;
demand and supply factors" through which a market price,
or a "natural" price is established.
The judicial authorities of this andother^Countries have
frequently defined the concept of "fair price" as "that price
which a 'willing buyer' would pay to a 'willing seller.' " This
means that not only must there be no coercion of any nature
on either party to close the bargain, but also that each
party
in the transaction used no means or had no knowledge of a
condition that places the other party in a position of "un¬
willingness" or of duress, economic or legal, which forces him;
to close the transaction at the terms agreed upon.
Now, let us apply this situation to the "Full Disclosure
Rule"!
acting as a broker by sending a con¬
purported 'principal.' The decision initially
made by the firm to recommend the purchase of a secur-ity which it did not own was a voluntary decision which
committed the firm to the role of brokerage.
That role
could not be changed without explicit and informed con¬
sent in each case prior to the completion of the transaction
or
explicit and informed ratification afterwards and non¬
action of the customer upon the receipt of a principal
confirmation did not, in our opinion, constitute such rati¬
firmation
as a
fication."
It is
apparent that under the circumstances described,
the SEC is
attempting to place a broker's status on all dealers
they, as sellers, offer wares not immediately held
in stock.
Here, again, the Commission is tearing rough-shod
into traditions and practices that have existed in almost
every field of merchandising for centuries past.
It is still
the custom in many lines to contract to buy or to sell with¬
out the property being in the possession of either party.
The responsibility of the dealer is not lessened, but rathe):
enhanced in such transactions, and certainly, where he takes
the risk of being required to fulfil contracts made, he should
not be placed in the status of a broker, and limited to k
in which
broker's commission.
A broker is assumed to take
no
risk,
except for the account and at the expense of his principal.
But
a
security dealer, who sells securities and finds that he
undertakes an extra
does not have them "on his shelves,"
hazard in
being required to "shop" for them, for he is obli¬
gated to fulfil his contract to deliver to his customer. If the
theory of the SEC is followed out in other fields, as, for
example, foreign exchange, it will destroy the whole trading
mechanism of an international business. Imagine, limiting a
bank or a foreign exchange house to selling exchange only
when they happen to have it on hand!
If this situation ex¬
isted, foreign exchange transactions would be greatly restrict¬
ed in scope and usefulness.
The important function of spec¬
ulative exchange transactions in stabilizing exchange values
would no longer be effective.
The SEC seems to ignore the fact that the function oil
modern merchandising is not merely delivering through sale?
If a seller is forced to disclose to a prospective buyer the
price at which he acquired the property he offers for sale,
and consequently, informs him of his profit margin, he is
the well-established and well-en¬ placing himself in a disadvantageous position. He is furnish-l
trenched corporations which have
ing strategic information, which will weaken his bargaining
been serving the public for years.
powers. The psychology of the buyer will be such, under the
!
"Potential abuses might arise ip
the case of smaller, younger, less- circumstances, that he will hold off, until he acquires the
er-known," or closely-owned cor¬ property not at a price he is willing to pay under competitive
This is a very primitive
porations. For example, let's as¬ conditions, but at a price at which the seller can afford id goods and commodities on hand.
sume that a corporation, up to the
sell. It would mean^a constant narrowing of the profit mar¬ concept of merchandising, the "market place" idea. Modern
beginning of the war, was doing
merchandising consists in making purchase and sales con¬
gin. The "higgling and bargaining," by means of which
a Small volume of business, but
tracts and offsetting these transactions, one against the other.
which during the war increased equitable market prices are established, would disappear.
These contracts are generally carried into the future.
A
its activity many-fold. Its profits
And this applies equally to buyers and sellers as separate
skyrocketed,1 as did the compen¬
sugar refiner; will contract to sell his product months in ad¬
groups
as
well
as
to
single
transactions
between
a
buyer
and
sation paid to its. officers; Along
vance of its manufacture, a shoe manufacturer takes order's
a seller.
If dealers as a group are forced to disclose their
came V-J Day and, the corpora¬
for shoes, before he even has the raw materials on hand.
tion's war contracts having, been relative positions to their customers or to each other in mak¬
Why; then, should? hot a security dealer,s if it is in Hne with;
terminated, the officers decided to
ing trades, they, as a whole, are placed at a disadvantage in
the custom and practice in his tradf^sells^iiritiesifor future:
reconvert. The reconversion costs
bargaining.
and losses incurred during the
delivery even though he has them not on hand, but contem¬
II.
balance of 1945 were deductible
from 1945 incomes, and as a re¬
The recent decision in the Oxford Company Case is an plates obtaining them through, the normal course, of trade?
As long as he is assuming the risk of fulfiling a contract, he
sult the corporation's taxes for indication
that, in connection with clear cases of fraud, em¬
last year were sharply reduced.
has the status of a dealer, whether the securities are obtain¬
bezzlement arid unfair dealings of certain securities firms*
However, let's assume the officers
able readily or. with difficulty.
the
SEC
is
intent by subterfuge to apply its "Full Disclosure"
favor 'tax-coasting' now, or bank¬
III.
:
ing on the refund of excess prof¬ philosophy.
Though, as has been pointed out, the decision
its taxes. They are merely trying was in no
It cannot be doubted that the ultimate effect of "dis¬
way directly connected with this principle, there
to make up. their minds whether
is a. statement in its text which attempts to deny the status closure to customers" wquld simply be a me^s of restricting
to reconvert to their pre-war ac¬
of a "dealer" to any security firm which sells securities that profits. It would amount to nothing more in the end than
tivities or whether to take on new
lines. If they coast along for a
it does not have in its possession as owner at the time of the the regulation of the "profit margin." The margin would
good part of 1946 about their re¬ transaction.
tend to become fixed, and would be narrowed to the lowest
Thus, the opinion states:
•
conversion
plans, and draw sal¬
high levels,
of, or reduced
activity, of the corporation's fa¬
cilities, they may, as the law now
stands, get a refund of excess
profits taxes paid in 1944 or 1945,
(Continued on page 275)
aries at unreasonably
based
on
the lack
"It appears from the evidence in this case that re¬ point that the strongest and most resourceful could or would
spondent solicited from its customers orders to purchase be willing to carry on the trade. This would result in with¬
specifically recommended securities when it knew that drawal of more and more traders and dealers from the field
and a trend toward monopoly. It would confine the business
upon receipt of such orders it; would have to go out into
the market to obtain the securities in order to be able to to the few, the strong and the mighty. Competition has a
fill the orders.
tendency normally to do this, and it is for. this reason that
Volume
163
m
curbs
Number 4456
.v
irti
-V• >
,p
.■
-
\>;
-
;•■:*.■
•
.
competition, such us established under the Clayton
Act, the Federal Trade Commission Act and other fair prac¬
tices laws, have been evoked to
prevent monopolistic condi¬
on
,
tions'arising from destructive underselling.
<.
^ Here, again, we have the testimony of the keen reason¬
ing of Adam Smith! In discussing the necessity of including
dealers' profits as a component of the market
price, he re¬
marked that unless-the dealer's
goods "yield him a profit,
they, do not repay him what they may properly be said to
have teally cost him," and he adds;
"Though the price which leaves this profit is not always
,
the lowest at which a dealer
may sometimes sell his goods,
it is the lowest at which he is
likely to sell them for any con*
siderable
time, at least where there is perfect liberty or
as often as he pleases."
r
Thus, the disastrous, implications of "full disclosure,"
arising out of its tendency to limit profits, is that it portends
a
withdrawal of manjr: dealers from the market. This; in turn",
portends a trend, toward^cpncentration and monopoly in the
where he may change his trade
■
field of securities
marketing,
j
not.have-to^search far for proof of this! The
present price. Controls imposed by wartime conditions, it is
well khpwn, have
driven-mkny ismall manufacturers and deal¬
'
One does
275
cHKUNiafi
instance,
we
should not blame
ket the shares of
a
a man
for selling in open mar¬
bank that he believed
Sees
"Coasting"
going to break,
founded, not on information privately ob¬ On Tax Refunds
tained from one of the partners, but on his own observations
(Continued from page 274)
of the bank's public acts or on the judgment of other experi¬
or both years. It is just this abuse
enced outsiders. Again if a man has discovered a legitimate
that
Congress is most worried
use of
geological knowledge and skill, that there is probably about. Similar abuses may follow
a valuable mine on a
'war-baby'
corporations
piece of land owned by a stranger, rea¬ from
which decide to have the tax re¬
sonable persons would not blame him for keeping the dis¬
funds carry them through 1946."
covery secret until he had bought the land at its market
"Because Congress has been se- ;
value. And what prevents us from censuring in this and sim¬
verely criticized in the past for
ilar cases is, I conceive, a more or less conscious apprehen¬ its inactions, insofar as particular
sion of the indefinite loss to the wealth of the community tax avoidance provisions are con¬
that is likely to result from any effective social restrictions cerned, it will, more than ever,
be cautious and inclined to enact
on the free pursuit and exercise of
knowledge of this kind. tax laws which prevent benefits
Such use of special and concealed knowledge is only cen¬ from
accruing
to
corporations
sured by thoughtful men, either (1) when it is for some par¬ which abuse the law," Mr. Evans
ticular reason against the public interest—as (e. g.) if mem¬ declared, and added:
bers of a cabinet were to turn their foresight of political j "It would be advisable for such
corporations to get busy immedi- 1
eyents to account on the Stock Exchange; or (2) when the ately and enter bona-fide produc¬
or
manufacturing.
Unless
person using it has obtained it in some way having a taint tion
of illegitimacy—as by betrayal of confidence, intrusion into this is done, serious and farreaching consequences may en¬
privacy, etc.; or (3) when the person of whom advantage is sue."| : ,
<
taken is thought to have some claim on the other beyond that
Mr. Evans explained that tax
of an ordinary stranger.
refunds will be available to all in¬
suffer
"Let us now consider the question that arises when we dustries that
legitimate/
business losses in 1946, and indus- '
try to define the moral coercion or undue pressure that ren¬ tries
if his belief
was
was
"
:
out of business,
despite the lip service and blandishment
given to the importance > of small business in maintain¬
ing our democracy. There-is yet to be announced a leading
producer or dealer that;has given up operations because of
that had paid excess profits
price controls. But, in the squeeze between costs and ceiling ders a contract unfair: viz. How far A may legitimately take taxes during the war,' if they show
prices, thousands of small concerns have J succumbed. /The advantage of the urgent need of B to raise the price of a com¬ a smaller profit in 1946 than that
large concerns can afford to continue to operate, and * they modity sold to the latter; supposing that he is in no way re¬ averaged from 1936 through 1939.
"Thus
it is
conceivable,"
Mr. V
gain through the disappearance of smaller competitors. Thus, sponsible for this urgent need? The question is one, I think, Evans
declared, "that the U. S.
of considerable practical perplexity to ordinary minds; and
the post-war outlook for
"big business" is strengthened, and
Treasury actually will issue re¬
all the deliberations of
Congressional committees and all the it requires some care in distinction arid analysis of cases to fund checks to offset losses that
promises and schemes of New Dealers of the,Wallace type give even a tolerably satisfactory answer to it. In the first business corporations might suffer
through strikes in 1946.
8
will not change the situation, if
they persist in curbing free Jplace, where B is under the pressure of exceptional and sud¬
"This possibility stems from a
enterprise by increasing and intensifying governmental regL den emergency, in which A has a special opportunity of complicated
provision of the Fed¬
mentation and control, price
fixing, profit restrictions, and rendering assistance, while the need is so urgent that there eral income tax law, applicable
is no room for competition to operate, it seems certain that A only to corporations, known as
full disclosure rules,, in
bargaining., ^Vll
would be generally blamed for exacting for his service the the 'carry-back.' All corporations
iidt promoteor en^ui^&the®^
had some credit against the war¬
full
price which it is BY interest to pay: and this would not time excess
by
profits tax, and only
kmly be true in cases of danger to life or health, where hu¬ earnings above that credit were
fied, and well finance^cbnceirns to continue
conditions generally imposed, and,
through; no faultaof<.their manity seems more obviously to dictate unbargained assist¬ subject to this heavy levy. This
own, by. the destruction of smaller competitors^ to, assume^ ance, but even where it is a mere question of saving property. provision of the corporate income
tax further provided that if all of
For instance we should consider it extortionate in a boatman,
monopolistic position in thehr respective industries:; ^
the excess profits credit was not
who happened to be the only man able to save valuable needed in one
year, the-unused k
IV#
wo^ks ,aL art.from? being lost* in a^riveryto demand for his! portion wuM be^aw'ied
? Turning to the moral aspects of the "full disclbsure^ services a reward manifestly beyond their normal price? that; added to the credit of a prior
philosophy, there is no valid ethical basis for singlihg.qulthe %;
beyond the price which, under ordinary circumstances, IJ* j*;
securities dealer and inflicting upon him a status.akin ,to4hat
"competition would determine at that time and place. Still, | paid in the earlier year, necessiof a criminal
profession.' Like other traders, he is -already it is by ria means clear that such, extortion is
'contrary to the tating refund by the Treasury.
amenable to the common law prohibitions against
fraud,.de-f principles of Political Economy' as ordinarily understood. The 'carry-back* provision applies
celt ^ corruption - iuid' other/unfe
to 1945 income, even though the
pra<^^J:5ThE^
Economists assume in their scientific discussions—frequently
excess profits tax itself expired at
that, in individual cases,he may^ make large profits^br-Strike. with more or less
implied
approval
of
the
conduct
assumed—
the beginning of this year.
a
good bargain now and then; j which is common and per¬ that
every enlightened person will try to sell his commodity
"The purpose of
the carry¬
missible in all business transactions, should not brand him
in the dearest market; and the dearest market is, ceteris back," Mf. Evans explained, "is
as, an unconscionable person.
paribus, wherever the need for such commodity is greatest. two-fold: (1) to level off, the
The morals of trade have been studied
by philosophers, Iff therefore, the need of a single individual is specially great; jheaivy wartime tax burden? and
(2) to compensate
corporations
economists arid theologians for centuries, but the right to a
why should,not the price demanded from him rise proportion¬ for any extraordinary expenses,
profit arid the desire for pecuniary gain have not been con¬ ately? It appears to me that it is just at this point that there incurred while reconverting to
demned^ but have been almost universally, upheld. An emi¬ is a palpable divergence between the mere abstract exposi¬ peacetime production. Fundamen¬
nent British philosopher,
Henry Sidgwick, an authority a tion of the results of natural liberty which deductive eco¬ tally/' he added, "this provision
was designed both to meet unus¬
generation ago on Ethics, as well as on Economics, wrote a nomic science professes to give, and the general justification
ual expenses and to speed produc¬
treatise on "Political Economylargely from the ethical
of natural liberty which Political Economy is traditionally tion, but as a matter of fact, tech¬
viewpoint. He concluded this massive work with an elabor¬ held to include, and. upon which its practical influence nically there is nothing to pre¬
vent such tax refunds from cush¬
ate dissertation on the morals of "free
exchange." His dis¬ largely depends. Enlightened self-interest, undejr the cir¬
ioning corporate losses sustained
cussion oi this topic covers the matter we are dealing with cumstances
supposed, will prompt a man to ask as much as as a result of strikes. In addition,
so* well that we quote the
following extensive excerpt from he can get: but in the argument that shows the play of self- actual operating losses can be
his. work:
back
and
refunds
|
interest to lead to just and expedient results it is assumed carried
"It is admitted that,
;
generally speaking, any 'really free' that open competition will prevent any individual from rais¬ claimed."
exchange of commodities which?the,exchangers have a right ing his price • materially above what is required for a due rMr. Evans reminded his profes¬
sional audience that Federal cor¬
to. dispose of is legitimate and should be held
valid, and that reduction of the demand. The price as thus determined com¬
porate tax refunds totaling $1,'real freedom' excludes, (1) frarid, and (2) Undue influence;
petitively in an ideal market presents itself as the fair and-- 000,000,000 have been officially
but how; are we to define these
{latter terms? Is A justifled generally speaking—morally right price, because it is obvi¬ forecast "as the potential result of
unused excess profits credit^ and
in taking any advantage, that the law allows hiiri (1) of the
ously an economic gain that the supply of any commodity loss carry-backs in 1946,. even
ignorance and (2) of the distress of B—supposing that A is should be transferred to the
persons who value it most and with a fairly favorable business
not himself the cause either of ;the
ignorance or of the dis¬ prima facie just that all suppliers of similar commodities climate,
-'
tress? If not, to what extent is he
justified in taking such should be paid the same. In exacting as much as this, the M'lf labor disputes during 1946
advantage?, In the answers that thoughtful persons would self-interest of the seller seems to be working as a necessary should spoil that climate," the
speaker added, "carry-back re¬
give to.tjiese questions we may,; I think, trace the influence factor in the realization of the economic
harmony of society: funds might be substantially
of economic considerations,
limiting the play of the natural but any further exaction which an accidental absence of
greater."
or moral sentiments of
sincerity and sympathy.' \
y.
competition may render possible shows egoism anarchical
and
#
"To begin with the case of ignorance; we should not
discordant, and therefore, no longer under the aegis of
H.B.KucHCo.Will
blame A for having in a negotiation with a
stranger B, taken economic morality." (Henry Sidgwick, "The Principles of
advantage of B's ignorance of facts known to himself, pro¬ Political Economy," London, 1887, pp. 586-8.) / *
vided that AY superior knowledge hqd been obtained by a
PHILADELPHIA, PA. —Harry
legitimate use of diligence and foresight, which B might I
And thus it is, that, viewed from its moral as well as its
G. Kuch is forming H. G. Kuch
have used with equal success.
We should praise A for mag¬ economic aspects, private bargaining and transactions in- & ; Co. to engage "in a securities
nanimity if he forbore such advantage: but we should not volving exchanges of goods and services under competitive | business from offices in the Widblame him for taking it, even if the bargain that B was thus conditions require no enforcement of a full disclosure rule in ener Building. Mr. Kuch has been
led to make were positively
injurious to the latter, suppos¬ the purchase and sale of securities, and, any imposition of a
the present
ing that the injury would otherwise have fallen on A, so that restriction of this nature would overturn the foundations and time prior thereto he was a partthere is only a transfer and not an increase of
luui'v in 6c Co,
damage. For revolutionize established traditions of trade and commerce, nt^
ers
:
_
'
k
,,
,
-
.
.
Open in Philadelphia
Ait
..
THE COMMERCIAL & FINANCIAL CHRONICLE
?76
of
enues
The Outlook for Railroad Bonds
254);;
(Continued from page
Space or time will not permit the furnishing of
railroads; hence a few selected roads are exhibited:
the data for all
*
Annual.
Ton-,
7s;j.„'
'- -
2,078
20.662
2.993
1929
' 4.61!
..
.
1,821.
.14,1110/
11,922
48o
7,395.
■''
2,-491
-
31,286
48,050
606,000
■
38,109
8,110
1,453 -47,111
260,000
36,903
,
1943i_-;
14.126 vr 24,515
7.756
:'83« ,32,195
576,000
C. No. West.
-
•
....
.
45,358
V 2,425
11.428
8,465
1,805
196,200
72.427
..
26,893
8,101
1.140
47,383-
424,800
33,994
.46,008"
316,800
1943-L-
15.968
24,28.8
2,316. 1,125
2,243' s" 774
25,984"
i >
657,400.;
54,618.
(
41,239.)
/
eral Income/ Taxes,
-
•
■■ '
i-r'/i,
;
;
$80,379"
-2,427
i ^ 65,298»
.
Atlantic
-r
59.3
....
:'r"r
I'
»;
283,200
65,829
50,077
1,762
1,407.
0721
6,330
-
'
Lehigh Valley
1929-CUt 5.144
18/081
1,362
725
1943.— r 8.491
13,717/
1,260
.400
27,732.
...
'•
4,019
•
IlliriQis: Central
/ 56,700;
Valley
&' NashViHeu.^-,-
(Consol.)i-—u
Pacific
Ney?
CentraU—
York
23,100
_
^
•
..
5,366,.:,.
•
38,866
:
37,714
"
16,568
/■
X-
'2,640."'
-
>1.463 /
,
5,886}-;
•8,700"'.'-
5.21
2.90
2.05
6.93
6.93
5.71
5.71
32,050
/-8,8i28
40,962^
58,500 /
-121,900};;
90,6p8>
,3.17
4.34
4.34
4.08
4.08
2.45
2.45
6:19
5.19
•14,654-.
5.61
2.79
43,710
v
2.07
2.07
3,774 &
4.58
2r78
3.57
3,-170
'
43,710 /
The.
-
,
..
.
that
near
experienced in the years 1941-1942, reference is made to the
constancy between Railroad Freight Revenues and XL S. • Pas¬
Automobile Output during recent years:
senger
InTerms
74,400
1.80
1.80
1,875
4.40
// 4.40
S t.)
Louis-San /Francisco./»■_
>£ of Passenger
'
13,550
-—17,800
Southern Pacific _/
118,800
—
Southern Railway
1936-///
19351-/-
3,664,600
the
same, function- for- privately-.fU>>/
panced: war /housing/construction///
.
terms of each passenger car pro¬
U. S. Passenger
the Post War
,
by referring to the? January, 1944
Chesapeake & Ohio
Lines Magazine "Tracks" wherein
Brig. Gen. Leonard P. Ayers, an
edition of the
Economist of renown,
showed the
constancy of Class I Gross Rev¬
years;
enues
lent of $1,000 of
m terms of each
proximately 6%. In this article he
6,000,000 units for several
application of/ the equiva¬
freight revenues
car produced re¬
sults in the estimate of $6.0 bil¬
lions of Freight Revenue for the
American
the
discusses
in * the
Income of
National
to
Post
ap¬
economy
Revenues,
we
consideration Passenger Revenues
and All Other Revenues.
Paying heed to those who direfully look upon the results to the
Railroad industry of the peace¬
time return of the normal compe¬
tition
from
airplanes,, omnibus
private passenger cars; let us
figure upon Post War Railroad
and
Passenger Revenue of only $400
millions annually vs their current
annual
level
of
approximately
$1.6 billions.
,
;
/Let us, likewise, figure upon the
loss of a good portion of Mail,
Express, Dining Car1 and Milk
.
Revenues
(included
All
among
9,493,000
27,004,000
5,990,000
*4,733,000
13,812,000
106,336,000
fl (126,730,000
••50,789,000
12,123,000
64,146,000
7,310,000
14,492,000
Northwestern
Eric
Mobile
Ohio—
&
Great Northern
—
"
Our estimate of $6.5
billions is
squarely between the two levels
of the Ayers' estimate!
If any stronger weight need be
added that Class X Gross Revenues
will
at least at
run
$6.5 billions,
made to
Valley
Louisville
Nashville——
&
(cons.)}..——
Central
—//.
York
New
York Chicago
Y
N
H
N
Northern
—
Gross
Revenues
of
$6.5
annually for: the early
years of the Post War Period.
Such expected level of business
for
as
the
Carriers, would
follows:
,
.
/':
compare
:•",,
.
TABLE
III
-/•'/////.///-//
(In Billions)
1945—<*$8,650
3.944
9.435
1940
4.2 96
3943
1939—
3.995
1941—L/ul
9.054
1942-
7.465
$5,346
1929
6.278
-
♦Estimated.
That I
that
Gross
not alone
am
the
Carriers
Revenues
borhood
of
$6.5
of
in
in
my
will
the
billions
is
be¬
have
neigh¬
found
"18,828.000
1fff50,406,000
Zf§ §2,743,000
/il,107,000
.
i
Z—_J—1_—-i,
Pacific
——
—j
41,192,000
26.888,000
5,267,000
12,659,000
V
83,492,000
/
6,242,000
§§10,295,000
118,382,000
60,448,000
8,297,000
48,487,000
18,789,000
30,790,000
15,086,000.
80,444,000 111143,508,000
3,774,000
•
4,923,000
23,043,000
938,000
2,677,000
>
*1,508,000
22,132,000
11,290,000- 1!1140,580,000
30,178,000 ,M 104,743,000
13,127,000
17,900,000
; *4,108,000
1,348,000.
4,105,000
/ 742,456,000
/ §§6,065,000
/
27,644,000
1,903,000
42,951,000
as
Adjusted
including
possible holdings of Government securities, etc,, carried outside of current assets.
Kin-
Valley.
••Includes proceeds of sale of p$72,335,000 debentures 4%«
in 1929 to pave way for meeting at maturity in 1930 of $69,000,00f.
"Omaha" bonds).
tfEstimated to include Gulf, Mobile & Northern N. O/Great North¬
ern
and Mobile & Ohio,
tflncluding tax liability; figures unobtainable.
§§Deficit.
eludes. Hocking
issued
If fiSept. 30,
1945.
progressing faster than had been
anticipated—predicted that civil¬
ian production in key < industries
exceed
1939-41
the
this: prediction
course,
occurred
(Of
made
was
before the recent intense
strikes;
base
wave
whereby
.of
the
mates
was
the
most
one
of
obtained
from
42
of
important
industries
representing 3,750 manufacturers;
these
estimates
allowed
that by
June, 1946, production of
these industries may skyrocket to
187% of the 1939-1940-1941 base
period.
(Quite naturally the date
put will probably be delayed to
degree owing to the previ¬
ously mentioned wave of strikes).
some
Nevertheless, apply/tig
increase
1941 base
millions
to
the
average
Class
for
87%
I Freight
the 1939an
period, and adding $400
Passenger Revenues
of
and $100 millions of Mail Reven¬
ues,
the result equals Gross Rev¬
was' offset—can, be
expected
vertible bond issues, or even ad¬
ditional stock on a "rights" basis,
to
will be sold
V 2. Applicants' must
show "that
they will be ready to start construction within 90 days and ck m-
are
(in
of
ed within 90
days.-the HH rating
a new applica¬
tion must be made....
3. An applicant must agree to
make the housing ^available.only
to; veterans during the course of
further
r
;>
conclusion
the
at
to
non-veteran, but
a
terms at which he
the same
on
the accommodations available to a
.
Mr,
counselors,
Union
In
my
Battles
,
Com¬
of
will
.
<
in
'
He
-'i u«tj
Zl >'
a
maximum
sales
or
price
below
origi-/
5.
The
regulation
for
conversion
.where
/
also
proexisting
of
it
can
*
be
housing fa-
.
: :
•
dent /veterans.
of
1946
;
t
will
be
a
difficult/;/:
ent and there is
no point in trying
that fact. But I firmly
to
after
believe that if cities and the Fed-
'/v>.//
Western
and
of Har¬
vard Graduate School of
Business
.
,
for housing is all too appar ¬
with
Ordnance, be¬
graduate
University
Administration.
quotations
r
is
Reserve
bonds, * which
higher
/"*•*'*-1 •?*>
resale must be made at
the
year
re¬
ing stationed at Washington, D. C.
estimation these factors
result
-i
Lieutenant,
-Zr;'; and San Francisco, Calif.
for railroad
«
same
That
recently
was
with the Bureau of
all add up to a still higher credit
status
-
30-day waiting period *
exclusively for other veterans in//
the case of rB-tesale during the life'//
of the priorities regulation and the I
Building.
leased from the U. S. Navy
added
the equi¬
///!/;■
vetz
other purchaser is pledged -
6. The regulation not Only pro¬
priced hous-/:
ing and /multiple-unit dwellings//
serving three and one-half years
ties.
*
veteran.
vides for. moderate
Boyd & Co.
the/ rank
on
:
agreed to make
Staff of
merce
savings
will /: be/accom¬
plished; also, there is the confi¬
dent
prospect' for
further/ in¬
dividends
y
of
thereafter,
cilities will result.
terest
in
•
which period he may sell or rent z
vides
to; further debt reduction and in¬
creases
*
construction; and' during 90 days
Arthur Battles Joins
ment
Thus, at the start of 1946 we are
facing continued railroad pros¬
perity, whereby presently strong
be
-
becomes void and
W.
working capital—are substantially
higher than at the close of 1929.
will
*
CLEVELAND, OHIO — Arthur for rentals but also for dormitories
Battles, Jr. has:; joined the or group housing for educational
staff of Boyd & Company, invest¬
institutions for the benefit of stu-
refundings, also reorganizations);
and finances—represented by net
treasuries
.
build-
ing permits, utility services, etc.*;
If construction has not been start-' :r
shown that increased
debt reduction and
>
arrangements
been made for local
co3istruction
sharply beneath the 1929 level
recognition of the combined
influences
*•
control of the land, that financing
debt elim¬
ination.;//--
fixed charges and contingent in¬
terest requirements in most cases
-
effective"
that they have
onstrate
,
publicly; the proceeds naliy paid.
to go toward, mortgage
fidently is expected to be at bet¬
ter
than
the
1929-1941
levels;
,
is reasonably related to the pro¬
posed accommodations.
4. In the sales agreement a
easily duplicate this showing in
the immediate years ahead/ since
the level of Gross; Revenues con¬
?.
/proposed price or rental/
have
§§19,976,000
f
FHA must be satisfied
The
that the
plans to build
6,701,000
10,760,000
* Adjusted
(latter
1. An applicant for an HH rat¬
ing must give in general specifi¬
Is assured, and that
9,379,000
:
/ 12,733,000,
34,102,000
2,634,000/ H'1118,061,000
♦5,140,000
:/
with
regulation which should
include:
new
1,653,00*
20,674,000
74,400,000
1,875,000
—_
/
16,412,000
7,453,000
be additions or
be clearly understood
to the
Revenue
lief
22,146,000
,6,173,000
to time there may
deletions from;this list.
Other points in connection
eran or
of attainment of this rate of out¬
'*•'
ttl.986,000
Summarizing, the Railroads in and lower yields* As a matter of
release^ of Aug. .31, 1945/ the trying years of 1929-1940— fact, I am even willing to fore¬
wherein J. A. Krug, Chairman of
having abundantly proven their cast that in. the not-too-distant
the War Production Board—re¬
ability, to so increase efficiency future railroad equities- will rise
vealing that reconversion was that the steady rise in wage rates in price to the point where Con¬
,
is
8,990,000
*10,325,000
Z
Francisco-———-—
Railway
/
———
Marquette
Southern
tings/ cast iron radiation, bathtubs,
erans.
53,349,000
43,710,000
St. Louis—
r—.—*
Southern
.
11,549,000
/ 34,506,000
10,396,000
Seaboard
t
14,409,000
2,359,000
Z *14,654,000
Pacific
Pennsylvania
Pere
&
Hartford.
&
priorities
and the price or rental at which.
he will make it available to vet-;
18,815,000
3,170,000
Pacific
New
which
apply include common, and
face brick, clay sewer pipe, struc-.
tural tile, gypsum board, gypsum •
lath; cast. iron soil pipe ana fit- *
press
reasoning would thereby timing schedules have been con¬
allow for $6.0 billions of Freight siderably delayed).
•
Revenues, $400.0 millions of Pass¬ / Data resulting in various esti¬
billions
;
Missouri-Kansas-Texas
Missouri
for
will
cations of what he
8,949,000
—6,743,000
,
'
,
Materials
reference need only be
This
result
produced,
>
-fi?
17,386,000
1,689,000
:
Lehigh
J
for
,
36,460,000
1i 8,065,000
•
§§29,474,000
10,553,000
9,234,000
Central
Illinois
-
:
holdings of Government securities, etc., carried outside of current assets.
to include tax liability, thus making 1945 figures comparable; although not
rate by the end of this year.
Revenues and $100.0 mil-"
lions of All Other Revenues. The
:
Chicago R. I. & Pacific—-u—v
6,626,000
billions.
Other
enger
—
fof-Tatekt reorganisation plan^ j f Fixed charges. and contingent charges
reported for 1929 are not strictly comparable on the same basis as currently, owing
to the change in accounting precedure commencing 1934 when certain minor change*
were
eliminated and deducted as a prior charge.
tDoes not give effect to possible
the.
>
$33,694,000
might reasonably be ex¬
pected to show ; Gross Revenues
running between $6.0 and $7.2
would
Revenues), by allowing for
equivalent
of
only $100.0
millions for this item (currently
approximately $500.0 millions an¬
nually). "
;
1945
1929
tYear 1929
23,286,000
and
rail¬
§Dec. 31,
"8,698,000
t- BUT, in order t6
roads
Working Capital
Chicago Burlington & Quincy—
Class I Carriers.
I
Net
tOct. 31,
Chicago Milwaukee St. P. & P.—
&
price
ratings/wilL;be^ issued/f;;
(finished price, including land and improvements) and
the top shelter rental is $80, it is
hoped that substantial amounts: of
housing at lower figures will be
the
.
Charges
3,019,000
Chicago
the top; sales
is $10,000
for
10,343,000
;
National Income ranging be¬
tween $100.0 and $120.0 billions,
upon
available
28,843,000
Ohio„
«fc
Louis-San
Class
balance
2.94
26,696,000
6,944,000
6,775,000
Line—:
Coast
Louis-Southwestern
that
Estimated
3.00
3.62
$123,920,000
20,760,000
U 58,056,000
St.
estimates
13,127 -v
2.94
;
$13,443,000
St.
arrive at Gross
must also take into
V
Est. 1946
v
.
based
War; Period,
3.62
$8,620,000
4,019,000
Gulf
least
rate: of at
'
Topeka & Santa Fe
Chesapeake & Ohio——?
in^
duced.. It is believed that we can
22,132
While
which/HH
;
lumber and-millwork. From time Z
Total Fixed
Atchison
:V After eliminating the collapse-year 1938 results, it will be seen
that the seven-year record discloses the equivalent of approximately
Revenues
7.05
22,132
13,127
estimated very satisfactory showing/the
following table, comparing financial strength, etc., is most inter¬
esting:
/>//////p-"/y/;
858
- -
■ .*•,
5.79
5.79 m
•4,108 ; ;
and Cont. Interest
903
.v z • >.v •
:
•1,508
♦1,746
.
TABLE
862
:
•1,508
of this
light
i
957
2,790,551,000
3,250,200
.
<A)
plan.
♦5,140
2.81
.
(E) Esti¬
charges - coverage ' AFTER all taxes (Including Federal income taxes).
(F) Estimated fixed charges and contingent interest coverage AFTER t^ll taxes (includ¬
Baltimore
•
reorganization
/
4.76
fixed
Atlantic
•
80,133 : /
1,875 /
charges and contingent interest (exclusive of sinking fund and capital fund).
mated
1,428
-
•3,040
'
charges (after taxes other than Federal income but BEFORE Federal income taxes.
(E) Estimated balance. available for fixed charges AFTER all taxes (including Federal
income taxes).
(C)
Estimated annual fixed charges.
(D) Estimated annual fixed
1,134
-
iatest
14,476 '
8,734
12,324
38,611
55,600
Adjusted for
;
/
/allZ/
appHcatiphs-lot prioritios;/Under zf
the
war
housing - program/' the i
FHA field offices performed) th is ;
fixed
2,858,077,000
3,377,908,000
3,308,540,000
r)
.20,700
•
Louis-Southwestern
Sea"board
3,251,096,000
3,915,600
annual
74,400
.8,260
$1,184
2,001,600
the
134,179
4,447,568,000
3,537,149,000
-
at
174,031
Marquette 1_——/12,500
None
j.938—>„
Period
2.37
None
1937—
in
2.37
None
3,754,800
3,693,600
2,866,800
upon
10,396
5,944,742,000
1940
safely count
Car
Output
10,396
6,781,836,000
1942->Z;
Freight
"J
$6,997,382,000
1941-//-/
of
"24,679
Cars Produced
None
$1,000
34,200
Class I Roads
None
v..
/-■;/ 1.93
Car Production
None
"
3.10
Freight Revenue
1944,—.•_»
/■'•D---rf/'.v.*
♦10,325
U. S. Passenger
i943-.___-
1939-
♦6,450
In
Frfc, Revenue
;
*
/
Pennsylvania '
St
4.58
"
17,290
20,030
.
North Pacific -—J—————
Perc-
3,774*
26,300 :
26,500
Chicago & St. Louis'—
N. -H. & Hartford—/_-
N. -Y.
ing Federal income taxes j.
TABLE II
Year—
Y.
N.
the
Housing Agency • which
Ad m inistratioh/zEc^^prbc^
•
showing for all the carriers is somewhat the same; in other
words, Railroad Management HAS offset the steady rise in wages
by- increased efficiency—thereby requiring less manpower and keep¬
ing the influence of wages upon operating expenses within narrowly
fluctuating confines,
<"
* ■<
>.
It is evident that the public, as a whole, as yet has not given
full credit to this outstanding performance and, therefore, as there
Results a greater public recognition, so will the credit status of the
carriers improve.
;
As concerns the second expectation that the Class I Railroads in
the Post War Period will handle a level of business ranging between
>
Civilian
•
1,689 r
"
■
the
://
4.73
3.48
£
this^ rating: has - t
by/
constituent,!the Federal Housing
16.1
5.08
"
'
delegated
will utilize the:field offices of its
6,173
..
Power to award
been
Production Administration to
3.90
6,743
-
dwellings for sale or rental
to veterans of World War II.- T y
8.86
9,234
♦7^300
new//
3.91
6,743 /
*2,470
.
-
5
255)
the
of
9.79
9.234
>6/173 ;
page
terms
regulatton, ah( HH; rating/is estab- z
lished; for ten housing materials ; r
which are in critical short supply. *
These ratings will
be awarded ->
either- to individual veterans/ who w
wislx to build for themselves or to '
builders who wish/to *erect One^oir/:!
'
"
.
the
National
3:85
8,949-
'
5.21
.
•
8,949
7.12
7,310 /.
.♦4,733
:
•
,
•
.
/; 5.990 '
/; 5,101 :
>1^89 '
(Continued from
-
/Under
'
.26,600/
6,994/ '
,
(F)
9.27
•
/
;
5,88ft
-v
/
.
49,300
••
-23,3f)6: /
22,504 /
25,484
58,800
/'12,600
Missouri-Karts&s-Texas
'
Housjhg/Morttio^
more
/(EL
.
4,§49
'
.6,994
•34,080
j 35,000 ;
34,500-v /
;/ 37,600/
>r 7.800 5
><
Miss.
57.5
35,193-,
2,565 j
17,154.. 619,000
Mobile & Ohio
51,000 -:
Great Northfirh'
Lehigjhs
> 64:0% <S
•
>^3,481 ■/
:
Louisville-
$34,272
$6,620
>./>>■ v.-,
(D).
$8,620
;
Chicago Milw. St, P. & Pac.
Ci^icago ■ Northwestern
CrUlf
-
•:
'I8i800,'.
Chicago R. I. & Pacific—//
56.8-
90:809
-
$1,896
284,500
64U&
$90;355
2,202;
-
20,972
30,700-
(C)»
•
.
Ohio///—////_ / 73,200/.
54,560* "
Ohio_i_/^.// ^76,200// / 48,518 X
Chicago. Burling.
Quincy/
52,100 /
33,615 /
.
$1,654-
597,500
$61,408
$96,600
Line/
•
/
;
,
.
.-
-
.(ooo's Omitted)1
.
(B)
.
&
-----
s;3ooj "60,682/ )584ff
:
.
&
63.9%
$62,469
$1,838"
Coast
Chesapeake
69.7%""
$i,772
,-/r
IV
-
■-:>.///
Topeka & S. Fee_z
Bi-.ltimore
1,4
111..Cent:
19-29 V- 15.467.
24.641-
■T-.X
*'
V^,'' /••'
."■/;:
1943—
"
-y..(A)v/
56,8"
59,437
*
-
10.770
...
--
Atchison-
• 62.7%
$68,136
$1,787
proceed to take up
which is an estimate of
the amount of earnings expected
to be available for Fixed Charges
—both BEFORE and AFTER Fed¬
TABLE
>
Administration of Gl
3
For'Early Post War Period, Based L'pon_$6.5 Billions ot Class I Gross.Revenues:-
,58.7
:
X '£'$
Z ■■.-5i.lv i
*
1929—.
1943---
Eric
'
65.7%
.
8.903
1929—
r-."•
60.8
;
$1,669.f $73,392
2,319 " /Z 72,561-k
9.917
War years," we
Point
-
'
C. RI. & Pac.
1929—
level of business in the early Post
heretofore
have
we
z
expected
the)
outlined
hRving
the
correlate
to
earners
to operating expenses: and
wages
Now, having discussed the abil¬
■?.:
$35,447 1 .59.6%
■
66,101->292,800?
s
18.960
1943—
than
the
of
Thursday,!January 17,»1946
*
>
to
•
Omitted) Oper. Exp.
$1,716 /
•
325,000
-1,575
9,029- 1,030
9,373
43,961
12.873'
l-92si_-
144,300
■
•
(OOO's
Empl.,
} Em pi.
.784
.
Z/->Z:ZZ
C. B. & Qncy.'
higher
billion
"minimum"
Payroll-
Payroll
per
ZZ/ZZ:-'.
'
$1.0
ity
seen,
estimated, / besides
being * $300
millions above the most optimistic
of Brigadier General Ayers'/ al-.
Total.
Total
-
Payroll
per
CarS
Locos.
Oper;
Z > (bin& ) Erapis.
Post. &'Me.
1943-1-
;"
Mile
Wo. Of
MLe
Frt.
"
.
billions.
$7.5
Ratio
Average
Ml.
Ton
::
•Aver;
is }
around
potentiality," it" will be
Jowance!:;//!:!;^
TABLEI
'
This
/
clodge
eral
Government
bor,
we
1946
join
forces
/
in
industry and la-//
will be able to look back
teamwork
with
the year when we
took f
steps to ease the
housing emergency and in which Z
on
the
the
as
decisive
foundations
laid
for
an
/
housing development which
will be worthy of the resources
and aspirations Of this country.
y
era
of
were
>
THE COMMESCTAT- «• FTNANCIAT. CHRONTCEE
Number 4456
■
.
,
"
i
\ 'r('>'<•
y
V'
\
;
•
•
;
,
Volume' 163
•
V
-
'
'
'
', '
•
'
..
11
277
v
,
The British Loan—A Good lnveslmeni
among
the United Nations'to fa¬
cilitate
'
trade.
An
the
Am. Savs. & Loan Inst. :
expansion of / world
international confer¬
To
and, in addi-^ back on their feet. Third, with ence is to be held next summer
;:
(Continued from page 246)
; stead
of economic cooperation; tion, she became heavily indebted such help, Britain would be able for the purpose of establshing an
7 the
world resorted to economic to foreign countries. A large part soon to abandon the wartime cur¬ International Trade Organization,
and of reaching an agreement to
warfare. / Instead •/ of
economic of Britain's merchant fleet was rency and trade controls.
From careful study, our repre¬ reduce the barriers to trade, to
statesmanship, countries, resorted sunk during the war. Receipts
The twenty-first annual confer¬
to
exchange
depreciation,
ex-' from other " services have also sentatives came to the conclusion eliminate discriminations in trade, ence of the American Savings &
and
1 change controls; trade restrictions, fallen, although they will prob¬ that Britain will need a credit of
to facilitate the maintenance Loan
Institute, the first with unbilateral > clearing
stricted : attendance
arrangements ably Recover with the expansion $3% billion to enable her to con¬ of high levels of employment.
since
1942,
tinue
essential
and similar measures.
of trade.
>
Wm >oe
imports until world
neid -W':/■ "/Y;■
needed for the war,
Hold
Twenty-first
Annual Conference
,
«
.
The fact is that the basic inter-
::
ex¬
solved. And now the war
has multiplied many-fold the dif¬
ficulties of the pre-war period.
Customary trade relations have
ices
this
been
to
economic; problems
were
never
disrupted.
New
of
measures
There
exports.
in
offset
be
must
which
is
Britain
buy the foods
by increased
other way
no
can
that
continue to
essential
are
the maintenance
of
her
econ¬
been introduced to meet the spe¬
cial conditions of war; and many
'
:
The expansion of her exports
is primarily a problem for Britain
countries will be. tempted to con¬
to solve; but. there is a
restriction and discrimination have
tinue and even to
perpetuate these
wartime devices.
.s
'
omy.
bility
,
and
orr us
tries too.
responsi¬
other
on
coun*
British indus¬
Even if
tries are in. a. position to- export,
Danger of Economic Isolation
they can succeed in exporting
enough to pay for British imports
by what we do only if there are markets abroad.
right now. Unless steps are taken That means that the pre-war vol¬
to prevent it, there is a real dan¬ ume bf world trade must he sub¬
ger that countries will turn again stantially increased.
'
to economic isolation, and that the
/ As part of her all-out war ^ef¬
world will again be divided into
fort, Britain was forced to reduce
conflicting economic blocs. Peace her export trade sharply until in
and prosperity cannot flourish in
1944 it was only 30% of the 1938
a climate; of suspicion, mistrust,
volume.
Even • with
favorable
and economic sword-play.
conditions Britain will need sev¬
The people of all the United eral years to expand her exports
Nations have given ample evi¬ sufficiently to pay for her im¬
The shape
of the postwar world
is: being formed
;
trade has revived and British
ports have expanded; / Even With
>• national
a
The decline in British revenues
.
abroad from investments and serv¬
dence
of their, earnest desire to
eliminate the economic causes of
conflict But they cannot: pursue
must find
this
and
until
course
sonable
assurance
they have
rea¬
that : their
war-
strained economies will function.
That is a practical problem that
faces
us
.
now,;and
the proposed
is subject
ports.
During
those
years,
she
to feed her
people and her factories with food
some
materials.
raw
to other countries to meet her
war
expenses overseas amount to
the
of
enormous
sum
loan to Britain, which
These
held
ances
are
of
$13
billion.
blocked bal¬
in
English
currency.- The
existence of the debt in this
specific example
mere,
problem.
form compels Britain
to limit
Under the necessity of war,
stringently the use of her money
Britain introduced extensive trade in
the Markets of the world/Brit¬
and exchange controls in order to
ain cannot deal with this problem
mobilize for total war. The use of
as an ordinary debt. We must re¬
foreign exchange was stringently
member/that this is a foreign debt,
limited by complete control of
and for a foreign debt the sum in-imports and payments outside the volved is tremendous. Some means
group of countries known as the must be found
by the British Em¬
sterling area. Imports from the pire to settle these
sterling obliga¬
sterling area and other expendi¬ tions.
tures within this area were paid
These are the important prob¬
for in sterling—British currency
'
—which
held in the form of
was
deposits in London or invested in
"British Treasury bills. Sterling
balances could be used freely only
; for payments inside the sterling
area. The dollars and other con¬
currencies
vertible
earned
by
sterling
area
countries
were
placed in a common pool and were
allocated for use where they were
most essential for the war effort.
lems
which- Britain
The
course
the
economic
must
solve.
she chooses will affect
well-being
of
the
entire world* Before the war Brit¬
ain was the largest importing and
countries
British
are
dependent on
their policies
so
are
of the
bee a
United
Nations
the
u s e
force
brought against theAxis^ was in¬
But the
creased.
continuance
these same measures after the
can
of
war
world trade generally.
on
Their stand¬
living will be little differ¬
ent from the austere levels forced
them during the war. *'
w
on
j
,The
$3 % billion to be. lent J to
Britain-will be
a
which
may
Britain
line of credit
011
draw during
the next .five years to pay for~the
imports .she neects. No part ot
the loan is to be used in paying
her debts to other countries. Brit¬
ain
Must
other
pay
these' debts
from
own
relations
trade
17% of
ish
our
exports and the Brit¬
Empire bought 42%.
Britain
were
the
and
not only
In fact,
British
Empire
best Customer
our
but also the best customer of the
what
Britain
does
to
eliminate
cerning
the
terms
posed loan.
of " the
In Britain
pro¬
they have
been called too
hard, in the United
States, too easy. They are, in my
judgment, fair to both countries.
They
take
account
of
Britain's
the
United
States
from
these
ac¬
fixed at approximately
million.
The broad terms
$650
was
provide that both -sums will be
repaid in 50 annual payments be¬
ginning in 1951 with interest at
2%,
.
Obviously,
cannot
we
There
foresee
be times,
may
agreements without serious
United States to compel a default.
It is better to do as our agreement
est and principal.
some
year
If a waiver in
should be necessary, it
will only be because Britain would
otherwise be compelled to restrict
imports of food and raw materials
to a level that would
endanger
the health of her
people and econ¬
omy.,.
to
On her part, Britain undertakes
relax and eliminate the war¬
convertible
into
trade
Position
;
.
Why, then, should there be any
thought that; Britain would con¬
tinue
restrictive
these
Britain is in
measures?
extraordinary and
probably unique situation in her
; dependence on imported food and
raw materials and upon foreign
an
/trade. * For
this
Britain
reason
stands to gain to an unusual degree
from the efficient functioning of
a
world
same
economy.
Britain
reason
the loss of the
for
But
cannot
the
risk
protection afforded
by these wartime measures unless
she
can
otherwise
food and
,
raw
secure
up
her
exports.
war
the next three to five years,
the wartime
tend
Britain's export trade and her international economic position.
trade
and
ex-*-
while trade with the outside world
would be
are
In
a
a
bloc
kept to a minimum. We
part of. that outside world.
sense a British economic
real
would
be
established based
on
preferences to countries with¬
in
the
bloc
and
discriminations
against countries outside the bloc.
The Anglo-American Agreement
After
of
more
discussion,
than
three
months
loan
this
Government
to
borrow
money.
and
institu-
tions.
sions
Ses¬
will
be
addressed / by
amount
British
credit
of
the
proposed
is large,
but it is
needed to do the job.
rep¬
resents
about
two
expenditures for
weeks
of
our
toward
war
its
close.
leaders in the
business,
t i
0
n
a na-
1 1 y
a
known
estate
Francis
E.
Ingalls
real
and by members o£
an alyst,
the junior executive group in savJ
ings and loan, some of Whom"
have returned recently from pver-t
Seas service.
'
',
;
In My
judgment, this is
Making home loans to veterans^
expenditure but ah invest-, under
the. Servicemen's Readjust¬
ment.. It is sound business for ment Act of 1944 as
newly amend¬
America.
ed, and the whole procedure of
Much of the money involved financing the construction of new
not
an
will be used to finance
increased
exports to Britain.- Increased ex¬
mean more American pro¬
duction. More production means
Even
ers.
more significant—the
proposed program will mean ac¬
cess
homes, including the new priority
regulations on building materials,
will
to
markets
more
on
an
be
focal
points of the
pro-
gram.
income to American work¬
more
Speakers announced to date in¬
Md.,
clude Henry P. Irr, Baltimore,
President
of
United
the
States
equal
of
also
basis' for
and full employment.
This is a
good investment- We cannot af¬
ford
international
archy.
economic
an¬
.
approval
of
the
financial
agreementjwith Britain will mark
significant
and
the
freely
all
ster¬
international
exchanges that/ the
Bretton Woods program has bold¬
ly set up as the basis for interna¬
freely
convertible •
into
Trade
longer
pe-
the sterling
use
they earn from exports for pay¬
ments in any
country they choose.
In
effect, under this financial
at once;
as a result the so-called
ster-*
lib ^-dollar pool will be abolished.
and
Organization devoted to
the maintenance of fair practices
in international trade.
We, more than any other coun¬
try, are concerned with the kind
of economic world that is
ing
built.
would
the
The
be
the
continued
fact
is
be¬
now
that
.
we
of
that
we
could take countermeas-
There is
ures.
could
use
defend
doubt that we
if eco¬
no
ourselves
4
will
make
her
would
be
reflected
in
decreased
stated
trade, decreased employment, and
that she intends to make an im¬
mediate payment ; on these bal¬
lower standards of living. Neither
a
large part will be funded and
over a
period of years.
released
These released funds will also be
freely
available
country, without
The
the representatives
were
three -major points.
First, a conflict on international
economic policy must be avoided.
as
for
in
use
discrimination./-
discussions
in
we nor
ford
a
any
problems.
well
A
joint
issued by
statement of policy was
the United States and the United
can
af¬
Savings',
States
starting its
the
savings and loan staff
s
The significance of the financial
mem-<
diploma. It has developed in the /
past 25 years some 70 local units(
for instruction in the operation ofr
a savings and loan institution.
'
w
Earnings of Federal
Reserve Banks for 1945
Preliminary
the
from
figures
Federal
received,
Reserve
Banks-
indicate that during the year 1945
their current earnings• amounted I
to
$142
million, according to anby/the Board1 of*
announcement
Governors on Jan. 3, which said f
that current expenses were $49
million.-
After
deducting
f non-
current charges and adding
ties,
prof-"4
sales of Government securi-;
on
net
earnings
for
the
year;
amounted to $93 million compared:
with $58 million for 1944, said the;
announcement, which added:
As required by
economic relations.
,/
the Federal Re-8
serve
Act, the Federal Reserve"
Banks-paid dividends of $10 mil¬
agreement with Britain goes far
lion to their member banks.
beyond its economic effects, im¬
net1, earnings
were
transferred to surplus accounts or
portant though they
a,
as
other country,
breakdown in international
world
in
Washington
concerned with trade
financial
any
day
its
coun¬
ances, that part of these balances
will be written off as a contribu¬
tion to the war effort, and that
United
Loan League, is
.anniversary
celebration;
resumption of- .its na-,
tionwide conference, Mr. Ingalls,
pointed out. It was organized m
1922 in Kansas City, Mo., and
hasr
primary target: in
On the settlement of the ster¬ nomic warfare should break out.
ling balances accumulated during But the cost
to us and to the world
Britain
Institute, which is affiliated?
the
graduated several thousand of to-;-
agreement among the United Na¬
tions to establish an International
agreement the ster¬
ling area countries will be free—
within a year, unless a
career-mindederri-;
bers with its Standard-Three-Year,
will
Under the
in the
tional trade and investment after
the war. It will make possible an
transactions
war,
The
with
to
who are;
men
thrift;
financing institutions as*,
the
as
real progress in the restoration of
a
world economy.
It will be a
contribution,
of the
up,
in command
ployes in the business.
silver
dollars.
the
well
with
dollars
ried is agreed—to
ly made
and home
current
be
Attendance of several hundred/
is predicted, with the group large-,
second
Marks Real Progress
The
/
tives of order and freedom in the
,
out
competitive
must work
which
are.
all
together if
This.U
countries
we are
live in peace and prosperity.
alternative—God
save
tc
The
us—is
to
perish .together. Mankind surely
Second, Britain will need help in Kingdom setting forth an under¬
ha s the wit and the will to choose
Many of her foreign investments securing her
essential
imports standing regarding a proposal for
were
sold
to raise the 'money 'while her export industries get a
commercial policy
agreement not death but life.
savings
prompt attainment of those objec¬
ling
of the United States and England
on
tional
restric¬
change controls. Trade within the own arrangements with the
sterling area Would be built up, tries concerned. Britain has
agreed
has seriously damaged
Brit¬
ain would have to retain and exr
essential
materials during the
period in which she builds
The
Unless she has help in securing
her essential import needs during
of
•/
educa¬
the * British
make
ling will be abandoned
V
this
Savings & Loan League; A. D.¬
American
Theobald, Chicago, Vice Presi¬
business.
In this way the loan
dent-Assistant Manager
jjrovides: accept the instalments
of the
helps to insure a continuing mar¬
of
League; A. A.;* Kirk, Chicago,/
principal due during those ket
for the products of American
years, while waiving the interest
Manager of the American Savings;
factories and-farms,. Large mar¬
payments, and as soon as,those
ami/Loan/ Institute ahd: -Mr.iTn'-|
kets: abroad *pla^, fin
^important
gails, who will give his president
temporary conditions pass, resume
the full annual payment of inter¬ part in our domestic prosperity tial address the opening morning, '
can
Britain's Unbalanced Economic *
President
oper ative
banks a n d
restrictive
imperil, or delay for wartime
restrictions
and
dis¬ agreement, many of the restrictive and
discriminatory currency and
many years, the restoration of a
criminations is so important to us features governing the use of ster¬
trade measures. There is ho doubt
sound world economy.
'•
and to the entire world.
They
Francis
E.
Ingalls,
Lynn, Mass.,
providing aid to Britain. The in¬
terest charged Britain is reason¬
able; comparable to what it costs
con¬
sequences. Under such conditions,
it is not in the interest of the
announc¬
ed .by
organ.tion of the co-
to
underiodepressed conditions, when
it will be impossible for Britain ports
to make full payment under these
Milwaukee
Feb. 22 and 23
it is
re¬
ability
Three and
ing from Lend-Lease and Recip¬
three-quarter billion dollars is a'
rocal Aid and the sale of surplus lot of
do-re-mi in anybody's book.
property located in the United But
war, • including its aftermath,
Kingdom. The net amount due to is
costly business; This loan
counts
in
pay. They take account of the fi¬
nancial cost to. this Government of.
need for aid and her
The
An agreement was also reached
the settlement of claims aris¬
on
with
Our
is unfortunate that there have
some
intemperate statements
been
resources.
Kingdom. Sterling balances ac¬
quired by Americans and arising
have serious restrictive effects
ica and
their
vitally linked to those of Brit¬
ain.
whole world, accounting for 27%
production and trade in Amer^ of 1 all world trade. That is why
on
belts well tigthened.
ard of
keep
received by Americans in
payment for exports to the United
that
trade
all of the foreign exchange Britain have always been close.
resources at her disposal into, the
Before the war, Britain bought
All
to
largest exporting coun¬
currency and
try; But Britain's choice has even tions.
Specifically,
wider significance.
Government
;will
Many other
to put
benefited
continue
time
the second
These measures enabled Britain
war.
to
the future.
The debts Britain has incurred
to approval by the
Congress, .is a
of facing the
way
credit, the British people.will
have
Criticisms of the Agreement
It
The
remaining
paid to the United States Treas¬
ury under the provisions of Sec¬
the
of
tion
13b
Act
relating
At the
eral
end
to
Reserve
industrial
year
Banks
their
$48 million frbm
tingencies.
Federal
of the
Reserve
ferred
to
loans.
the Fed¬
also
surplus
reserves
trans¬
accounts
for
con¬
,
THE COMMERCIAL & FINANCIAL CHRONICLE
278
Railroad Earnings and
(Continued from page 255)
I holder who isn't holding to ma¬
within
turity
the
period in
a
which
of the railroad make
resources
certain that all maturities
it
will
!• be paid, amounts of net working
capital and also whatever other
(improvements may1 have taken
; place during the war period, are
important
essentially for their
bearing on future earning power.
After all, Southern Pacific in 1930
had working capital of nearly $42
million and in 1933 of about $9.8
region
the
and
about
conservative
as
figuring it
when
a
could be
as
way
of
desired,
take into account that
you
of 1945 the camps
in the south were already smaller
in the forepart
had been and that the
than they
movement
transcontinental
the first six months.
like
ing capital at all. With a leverage
industry such as the railroad in¬
It will not be quite so bad in the
dustry you cannot be entirely safe
behind a tremendous wall of
working capital:'
^
in
South where freight revenues may
and
Which Will leave you with net in-^
of
come
$705
million and
fixed
charge coverage of 2.52 times.
is pretty good.
Unfortunately it
is not where we end but where
start, but even as
place it is pretty good.
we
consider
boost.
starting
a
We have
coming; .wage
the
How much will the wage
increase
be
and
what
to
extent
will it be offset by a rate increase?
be off about 18 %.
Suppose we say that there is ja
In the west, passenger business 12% wage increase and it is retro¬
will be about unchanged from the active so that it holds good for the
.thing
is
earning first half of 1945. In the first half year as a whole. Then let us say
Our question about the of 1945 passenger business was off you have an 8 % freight rate in¬
Decline in freight crease as a minimum, effective
future is essentially the question in the west.
of the future for railroads.
business in'the west will be larger for half the year.
On that basis
power.
the decline in the east.
Reports of railroad earnings for
1945 have to be deciphered as you
than
The
will
report a net income aggregate for
all Class I roads of perhaps some¬
thing like $500 million, which
would compare with $667 million
in 1944 and just about $500 mil¬
lion in 1941, But of course that is
after deduction of huge capital
expenditures out of earnings, that
freight
foreign language.
railroads for 1945 probably
would
is,
a
the
in
amortization.
of
form
The railroads
revenues
off
were
from
In the west in the first half
of 1945 freight revenues were up
quite
This is true
bit from 1944.
a
of the central west almost exclu¬
sively, not the southwest or north¬
west.
We are assuming that for
the west as a whole freight reve¬
nues
will be off about 30% in the
first six months from
a
year pre¬
vious.
second
half year
you
different
picture.
Re¬
the
For
actually will have
improved their net working capi¬
tal
during the year 1945 from
roughly $1.6 billion as of the end
>1 of
1944 to considerably over $2
b'llion. .The truth is that 1945 was
the first half of 1945
the east in
1944.
In
have
a
conversion
pleted
boom
ever,
sume
will
have
been
com¬
industrial
will get underway.
How¬
and
a
real
to be conservative let us as¬
that in this final half of 1946
for the rail¬
1941, even though the all revenues, passenger, freight
net incom e figures reported will and miscellaneous, will be off 7%
be virtually the same. To under¬ from 1945. On that basis railroad
stand 1945 earnings you have to gross for the year will come to
consider them exclusively on a something like. $7,3 billion. This
cash basis and on that basis they is practically the same as the 1942
are
swell.
The last quarter of gross which was between $7.4
1945 was special. We have to bear and $7.5 billion.
It is so large a
far
more
prosperous
roads than
feel it might be
Wise to be .-sfiil. a,, little more con¬
What is our general perspective
servative. However, with gross of
fcv 1946?
In spite of the "strikes
end interruptions of one kind or $7.3 billion, how much can the
roalroads earn under the condi¬
another, slowdowns in production
tions likely to prevail in 1946?
by management; etc., the Federal
Of course the key question there
; Reserve Board production index
is now rising.
You can
How fast it will is the operating^ ratio.
rise from here on will depend on come out with almost any result
it in mind when
we
consider 1946,
gross
that
you
■
how labor lets it rise and also
other factors
on
beyond the control
of management as well as those
within its control.However, it
fair
seems
will
sion
to
say that reconver¬
virtually completed
be
by mid-year.
Secondly, it
by
well
;
pretty clear
registrations
as
seems
automobile
b,y production schedulesthat throughout 1946 the use of
the highways will be far below
as
normal
that
and
the
drop
the
and
great bulk
of the traffic, other than military
traffic, that had been diverted to
declined, but that
the
of
railroads
from
trucks
and
wage
cuts.
It
soon
the labor difficulties iron
as
themselves
will
out,
increase
steadily.
Lumber, cement, and
building materials should show at
least
some
increase
1946
in
1945.
over
<
Let
was
working experience as well as
after a rough check of costs that
the normal expectation on a 16%
drop in gross would be a rise in
the operating ratio of something
million
earnings available before
the biggest pos¬
You deduct
$435 million estimated 1946 fixed
1946.
We
have
said
that
gone,
business
we
will
railroad
be
have included
off
oa«senger
33%%, and
in the east for
the
full
basically,
of
form
a
ahd
any
wise
no
reorganization can
be completed.' My be¬
lief : is that the " Supreme
Court will- decides that the
trans¬
mass •
a
takes
transportation
is; essentially
which
without
mass
vital
efficient
most
are
can
we
now
make
can
traffic
exercise, of judgment Ion
the plan pf; at least had the
If
right to r exercise
get enough traffic they
can
will
they
need
depends
changes the picture and that
what facilities they must de¬
vote
to
From
the plan was correct and; it
cannot
a
be
considered
something
that
is
million in
low
for
1944.
the
of
We have
to al¬
for
possibility of
some¬
can
thing
worse than that.
The worst
that anybody whom we know be¬
lieves possible, is a 15% wage in¬
Assuming
applicable
15% wage in¬
to the whole
year and an 8% freight rate in¬
crease applicable to six months,
we then get, adj usting again for
taxes, net income of $624 million.
crease.
crease
a
We can't stop even there.
Thfe
ICC seems,fully prepared to give
a rate increase to railroads.
But
the
machinery does not
You
fast.
move very
must
accept the pos¬
sibility that the freight rate in¬
crease will not be effective before
September at the earliest and per¬
haps not at all before the end of
the year.
Let us assume that you
cutting expenditures.
No
railroad bonds
now
Railroad stocks
in
are
too high.
a
cheap,
ings,
are
of the
a
need
particularly
in
up an up
ca¬
them
have
bear in mind the ultimate future.
The future of securities from the
standpoint of
any
practical
^rarn
the
future
means
less
because
of
pror
appreciation standpoint during the period ahead than
•
the stocks which have done
best up to now among the
rails, that is, the better grade
stocks.
reduction
A, This case involves two im¬
going
effective rate of earning
of the railroads but merely
a
the
is
question
securities
not
or
been
had
that
allotted should
be
re-
claims have
The other is
after
allotted
4. C. &O.
If it earns $3.80$4 it will pay $3.50. In gen¬
eral, considering the divi¬
dend picture l would say the
dividend paying stocks look
very good although the best
speculative play from now
One of them
of whether
portant points.
been reduced.
whether
or not the judge has
right to confirm a plan
is not accepted by
all classes of security hold/
on
the
'
clear
be
to
it
the
on
very
much.
Same
latter
point but the Circuit Court
Q. What about B. & O.?
I have no doubt
whatever that the Supreme
Court will uphold the Dis¬
A. I
disagreed.
trict Court
on
stocks.
A. I like
Southern Railway, Frisco
Seaboard.
Section 77 would seem
ers.
is in lesser quality
Q. Northern Pacific?
when it
the
from
not
*
Q. What about the Denver case.
backs, then those carryback earn¬
ings will be considered pretty
good earnings becadse they will
mean
3. Norfolk & Western,
Vir¬
tually certain of $15 a share
next year.
$5 extra divi¬
dend is in the bag.
That
stock should go higher.
I
4
Questions And Answers
its
.
2. Southern
More speculative stocks will
do better from a/percentage
Southern Pacific, for
much
earn
favorite
Pacific.
:
within
particularly, are cheap.
your
A. 1. Milwaukee.
because 9f possible wage reasonably few years and that fuincrease's, etc. Now. we must carry, iture is assured and is swell.. On
them up, that is, if they get down
the' basis of indicated earning
to $454 million, because of the
power, railroad securities, stocks
instance/has got to earn at least
something like $8 a share. It can't
poor years.
are
stocks?
down
carrybacks.
over
Q. What
securities
don't have to, at the moment,
we
and down industry
they must be allowed to have
extraordinary earnings
in
peacetime good years to tide
an
conclusion, when we consider
railroad
didn't
of; large earnings/ Commis¬
dividend-paying
of
pointed
rate increase because
a
sion said at that time that
because the railroads are £n
|vill be dividend increases ip 1946.
future
was
out that the railroads
essential part of the picture. There
the
a
earn¬
pacity of the railroads which is
/ In
industry is
period
probably rising
view
The railroad
148 rate case it
different
a
leverage industry facing
of fine and
.
freight
a
leveraged
industry
given to Very sharp ups apd
downs.
During the ex parte
standpoint
are
Railroad stocks, in
category.
as
per¬
highly
long term
a
ho
a
15% wage increase and
freight rate increase. Then we
get net income of $454 million, i
Up to now we have been carry/
ing the mathematical net incomes
A.
of the railroads is,
From
in
rate increase if earnings will
be over $1 billion in 1947?
one
what the ultimate future
say
judg¬
ment and> that nothing has
happened since then that
upon
getting traffic.
its
much
How
money.
correct dn
was
its
con¬
ceive of for mass production.
they
1
Commission
the country and are the
to
petual flux.
income
that
point in the
a
where
plan is set
development, lliat
place afterward does
not affect the plan.
Other¬
using
repre¬
production is impossible. They
unregenerate.
am
for
and
I think
B. & O. will do less well than
the average.
that question.
1-
Q. Why is Milwaukee your fa¬
something that prevents distortion
question,
however, is whether or not
of this.
securities
A. Stock
power
It is
1947
inconceivable that in
not
they
could
net income.
selves
how
railroads
The
earn
When
it
can
$1
we
ask
the
if
we
our¬
happens that the
do so well, as ap¬
and
on
the
and
Circuit
confirmed.
As
same
to
show
^aUre*''--
high
^
confirmed.
to
,r.
I
,
one
do
it
is
in
say as
desirable
zations and interest of bond
and stockholders of railroads
•
Someone is
licking, but
going to take a
is wiped out every
someone
has
of the best
year-to-year/
1945 and also the north¬
region
is
where
grain, lumber and livestock
bulk very important in total
railroad prospects.
1
/
from
terest and railroad reorgani¬
pfe in the future.
road which
western
why I believe this is that
think
a
showings of any region of
the country. The northwest¬
ern region did
not get the
big diversion of troops arid
supplies from the central
west that had been expected
Supreme
can
of
huge
cash
resources
and
which territorially will hiake:
plan will be
AIM
$3.50 dividend arid after
stock
,
Q. What national income basis
for 1946 do you expect in
the standpoint of public in¬
.,
earnings.
Ihere will not always be boom
not
attitude is going to
My guess is that it will
uphold the District Court,
and not the Circuit Court,
and that the plan will be con¬
firmed/ If I am right in that
(about $135 million less
•
cases.
I said I
.
that you are going to get $2 a
share conservatively for the
next few years and it is a
be.
then the MOP.
liVa./the
by a
Court's
To
bear' fwUict/fy
other
Court is
not know what the
gross.
weight of the tax rate, p bound
MOP
>
selling
around
31,
which price is going to be
/ rediiced almost immediately
upheld and the District Court
is upheld you can be prac¬
tically certain that the MOP
plan, for instance, will be
lies
be "lower than in 1942
vorite?
distrib¬
If the Circuit Court is
the
If
look at the figures, and
answer
be
must
upheld in the Denver case,
of course,
it will have a
bearing on the Rock Island
parently they will in 1946, in spite
of the drop in gross, in spite of
the increase in wages and other
costs, we can easily find the an¬
swer
important
uted.
billion
than 1945) and contingent
Tiie tax accrual rate is
comes
Why should there be
net
The railroads, however, never
outlook for
charges
interminable
process
the necessity of consolidations and
have
troops
drop that is conceivable in
various types of traffic.
We have
tried to do that in estimating the
any end to this
reorganization
16ng term standpoint it involves,
would
in the first half of 1946 in
the east, with the return flow of
assume
that they; be
strong financially -and it' is
also important if there is to be
ever
partly in the re¬
for 1945 of something like 67%.
duction of fixed charges,. much
Therefore let us assume that in more importantly in the elimina¬
1946 operating ratio will be 70%. tion of
amortization, including ac¬
On that basis we get net revenue celerated
amortization, and prifrom railway operations of $2,190
marily, of course, the decrease in
million. You wind up with $1,655 taxes. Railroad taxes in 1946 will
Federal income taxes.
;y.
present
raise, capital
process
portation,
still
the fact of its lack of effectiveness
ratio
being offset temporarily by carry¬
because of
the basis
.
there
railroads
which
of/ security holders
railroads who f have to
and
$674 million, comparing with $667
you
say
that the railroads iri
1947 may
conceivably earn $1 bil¬
charges lion does not mean they will do
of $33 million, and have net in¬ so, however.
The period that the
come
before taxes of $1,137 mil¬ railroads are facing for years im¬
lion.
How much will taxes be? mediately ahead is a boom period
Normal and surtax rate is 38%. and in boom periods a leverage
sible
us
sent
gross was
automobiles, will remain with the
railroads, even though the air¬
plane is a new factor in the pic¬
ture.
The return -flow of troops
will
probably have reached a like 2.5 to 2.7%.
What was the 1945 operating
peak in December, but according
to the; Army is expected to con¬ ratio?
The operating ratio to be
tinue in the West at the January reported will be over 76% but
level through April or May.
this
will
reflect among expendi¬
In
the East, the return flow of
troops tures a tremendous allowance for
will disappear virtually after Jan¬ amortization.
In order to arrive
uary.
Coal production, vital to at the true 1945 operating ratio
the railroads, will be some 5-8% you must deduct the amortization
lower in 1946 than in 1945, ac¬ of defense
proj ects, including the
cording to estimates of the indus¬ accelerated amortization, and then
try.
Grain shipments seem cer¬ you get indicated operating ratio
tain to be up.
Livestock tonnage
also will be up, and lumber, as
and with the adjustment of taxes,
the
at
flanged wheels on a rail,
operating
seems on
lic.. and
juncture.
carryback.
If the delay of the
according to what you take for
rate increase prevents the rail¬
ypur. operating ratio.
We have
roads "from earning more, than
projected a decline of 16% in
$454 million,'* it means they will
gross from 1945 to 1946.
That
earn $600 million in 1946 anyway.
happens to be exactly the decline
Net income for the railroads, al¬
in gross from 1929 to 1930.
In
that decline the railroad operat¬ lowing for all possibilities, will
range from $600 million net in¬
ing ratio rose 2.7 points.
From
come
upward—perhaps to * more
1930 to 1931 railroad gross drop¬
than the $6-37,000,000 of 1944.
If
ped a little more than 20%, oper¬
the market sees a rate increase
ating ratio rose 2.5%. From 1931
granted
but
not
yet in effect and
to 1932 the
in
greater
will/be, reflected .dras-?
indeterminable
The
That $705 million of net income
to
time railroad stocks go down.
It is in the interests of pub¬
J'
the
Vital
The
that
"r
statutory tax rate be¬ tib&lly in railroad' net, results. The
cause of special charge-offS. ;: Let railroads will have gbod ahd bad
us assume they have 38 % taxyac* years in the future.
On balance,
cruals/ On that basis Federal inf1 how they will do will depend on
come taxes would be
$432 million, many things, some of which are
than
of
troops was at all times small there:
Freight revenues in the east, that
is, the Great Lakes, Central East¬
ern
and
New England regions
combined, may be off something
25%
periods and whether, in 1948, 1949
or 1950 you will have the reverse
Rail Securities
Pocohontas
south. That is,
the
purposes
million and in 1938 had no work¬
even
/
these
Thursday/ January 17, 1946
>;
•
connection with the $7.3
bil—
"
V lion gross for railroads?
/
$145 bil//
// lion. Rail gross, 5.3 % of na¬
tional income.
iVv
A. National
income,
„
Volume
'-C;^.^.^l THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4456
163
f
methods.
abusive
is;,- met
chance
a
criticisms
plausible
or
which spring;
with
from a basic desire
toj keep
on fighting. .
eBusiness managers are confused
and
exasperated by
a
multitude of
regulations, partly
required by wartime,, necessities,
pdrtly needed by the peacetime
complexities of an industrial civil*
ization, -"and partly, imposed, by
governmental
the pressures
of ardent reformers
and
special interest groups;
are
resentful of the many abuses
They
;organi£ed labor power. ! They
are distrustful of politicians who
of:
regard their favoritism for organ¬
organizations. That is why
the '; lawless
and
ever-growing
power: to strike must be cut down.
> The spectacle of several hun¬
labor
dred thousand men launching an
industrial
today should warn
war
that tomorrow several million
us
I; piay
deliberately I paralyze
the nation's energies." When an ir*
men
labor boss today can
responsible
stop, the fuel, transportation, tele¬
phone and / telegraph service of
great Cities, we should realize that
the
tomorrow
be
denied
entjre nation may
necessities
the
life.
of
The
sight of thousands of pickets
marching
today . around
a
befleagured plant should warn us
that: tomorrow hundreds of ^thou¬
sands of such wilful law-breakers
not
its
a comparatively
disputes wherein
it may be necessary to require the
parties to accept the recommen¬
But, there
small, class
is
of
dations pi: a
sion. These
Presidential commis¬
disputes where a
stoppage of work will inflict in¬
are
„
tolerable injury on an entire com¬
munity or the nation. Compqlsory
and
arbitrations
enforceable
de¬
re¬
organizations
labor
the point where
to
to
force and violence which
tomorrow.
a
sym¬
wait to
homes
pathetic public permitted them to
acquire and* exercise in the days
when unorganized, helpless wage
earners were the common victims
have
invaded
and
by. official thugs
^
'
offices
our
the number of
'
,
What is the way to stop this
using flood of legalized force and
violence that, if unchecked, will
of injustice.
The
The greatest weakness of these sweep away our liberties?
lajbor leaders is their hostility to way is just as plain to see as the
highway
from
fhelDepartmerit
*of
impartial government. They feel
lustice up Constitution Avenue to
that they are still entitled to an
What is needed is
unfair deal; to be petted and fa¬ the Capitol.
not a law to forbid strikes, but a
vored as the representatives of a
law
to
make
strikes
unneces¬
Specially * deserving and unfortu¬
a law establishing proc¬
nate class of people.
With short¬ sary
esses of justice for the settlement
sighted selfishness, they are try¬
of economic conflicts; arid a law
ing to create an economic system
hat sternly requires all those en¬
in which all wage earners would
compelled to join unions and gaged in labor disputes to exhaust
.
unbearable dis-
and
tress and
hardship.
seen repeatedly that
a Mayor, or a Governor, or the
President was forced to use a
.We
V/
Needed: An Ahti-Strike Law
...
incalculable
have
doubtful executive power to com¬
pel the end of such a strike.
It
is an evil thing for the workers,
for employers, and for the general
public to have such economic con¬
flicts settled by arbitrary execu¬
tive action.
for
all
Yet it would be
to
concerned
worse
such
have
strikes continue. Governor Dewey
in New York had to stop a costly
strike of building service employ¬
ees.
Governor Kelly ^ Michigan
hadlo stop a strike of public util¬
ity employees. President Truman
had to stop dangerous strikes by
,
all
to; accept
the fixation of wages
arid distribution of jobs under the
monopoly, control of labor poli¬
ticians, Their success would end a
peaceful
ways
and
mears
to
•eiile them before undertakihg to
nake war on each oiher. -
The
overwhelming number pi
and
labor disputes can and should be
produce some form of State so¬
cialism
as
the
inevitable
out¬
settled by negotiation, or with the
aid of mediation, or by voluntary
growth of the labor dictatorship
which they are seeking to estab¬
lish.
Some of .them know this.
Most of the others don't know
arbitration.
competitive
free*
what
they
are
economy
doing,
or
efforts fail
and the public is riot to be seri¬
ously injured then the resort to a
strike or lockout may be justifi¬
able
don't
it
care.
at least tolerable.
or
Perhaps
is. necessary,
when the public
be slight, to permit ir¬
injury may
reconcilable opponents to resort to
a lest of strength in order to pre¬
Danger to Democratic
Government
Our Government is still demo*
that
serve
cratic in its representation of the
ub regimented masses pf
If these
democratic
of
sense
freedom which makes
the peo¬
ant
of
the
men
difficulties
and
toler¬
losses
ple* But, if the warfare between caused by democratic methods.
labor and management is per¬
.But the freedom to strike should
mitted to spread, everyone will
not be forged into as a license to
be compelled eventually to take break the laws. A lawless strike
sides under class-conscious lead¬
.
is
ers
of either labor or management
be
who are strong enough to
swing
national power and wise enough
tqf accept the responsibility for
the general welfare that must, go
with the power to prosper or to
ruin the nation.
But, a govern¬
ment by any class would be de¬
structive of political and economic
freedom.
It is the balances of power be¬
tween
industry
between
agriculture,
and
manufacturer
and
mer¬
unlawful strike which should
an
broken
When ;
yields
the
to
by
public
public
private force,
ernment becomes
spect.
.
authority.
police
••
.
power
the gov¬
unworthy of
re¬
■
ployed. to settle the terms under
ful efforts should riot end with the
failure? of negotiations.
These are
stoppage of pro¬
duction will seriously affect the
public interest.
a
In these
labor
vital
a
service,
issue
be written into
law.
is
morrow
might be persuaded
other plan would be
you
some
better and that jnine had serious
flaws.
Eventually you will look
to
representatives
your
•
.
>
;;Ii
T '
I•
But
sumers,
that
of
20
it
grows
too
destroyed without
As
a
great to
civil
war.
be
Labor
,
Act
under
has
,
free-people we can no
permit organized labor to
dictate terms to management and
to. regulate management, than we
could permit management to/dic¬
a
more
tate terms to labor and to regulate
years
procedure
will
the
proved
bring
Railway
this
about a
that
peaceful end to most stubborn and
difficult labor disputes.
C;, I
''
'
'
New Labor Law Needed
a
before
in ^Con¬
gress to solve the details of this
problem for you.
V
for
be
take
You might be convinced that my
program is a good one.
But to¬
tate to the rest of the
The experience
to
time today discussing the de¬
tails - of a Federal labor law that
would preserve industrial peace.
businessmen
settlement.
while
your
ests
people must
cut down. It must be destroyed
.
labor
you
law
of
a
make
can
.
today
as
is
up
your
to whether
This is not
needed
and
tration
a
commission would
written,
as
of
that
provision
be supported. But I
you
should be easily
or
every
a
labor
new
it
all
the
the
,
you
primary
duty
of
government to preserve peace and
good
that
order,
new
you
labor
know
law
is
already
urgently
needed in the United States.
should
also
able
the
to
learn
very
only
way
know,
or
be
quickly, that
in which govern¬
who
unwilling
are
to
the
American
people.
It is
destroying economic security, un¬
dermining Government authority
and: sowing broadcas t the seeds
of civil war.
It
grace.
It is
a
shames
national dis¬
before
us
the
,
those
to give
their
government the power to preserve
industrial peace are labor leaders
who regard themselves as defend¬
ers of the common people or in¬
dustrial
who
leaders
think
they
the ordained defenders of free
are
well-intentioned
losses
IT
whether
not
whether
incalculable
It
enterprise.
little
matters
these obstructionists
evil-minded
and
and
are
ignorant
or
They
cunning.
out against government com¬
pulsions but they are themselves
advocates
of a rule
of private
cry
force instead of
rule of
a
All those who insist
reason.
using
on
or¬
world in the very hour of a world¬
ganized
wide triumph of the strength and
selfish interests should be recog¬
nized
force
their
advance
to
public officials, and private citi¬
public enemies in an in¬
which can-*
not prosper or even survive ex¬
zens, strive to reestablish domes¬
tic peace with justice under the
more
law,
members.
of the American people.
courage
Yet when public spirited
the
leaders
men,
of, this vicious
labor warfare spit out their venom
like angry snakes. They even have
the arrogance
ident of the
"abject
to charge the Pres¬
United; States with
cowardice"
because
he
has the courage to
disregard their
frowning displeasure. ;
Upon what meat have Murray,
Green and Lewis. fed that they
have grown so great?
They are
not even elected by the workers
whom they claim to represent.
They
are
chosen by delegates to
conventions who
are
cept through the ever-closer and
the
can't
These
even
so-called
maintain
a
leaders
have to force em¬
ployers to compel the workers to
enlist and pay union dues—so
they will be able to make war on
the public with an imposing but
largely conscript army.
That is why every secret poll
taken
of union
workers
shows
maj ority
of them
prevented.
They
don't want to fight and suffer in
large
a
strikes
a
conscript
army
to maintain the
misrepresent them and lead i them
wars in which everyone but
the labor politicians and racke¬
teers suffer irreparable losses.
i
For sixty years Presidents of
into
,
ommending ' Federal
laws
that
would bring about the peaceful
settlement of labor disputes by
negotiation,. mediation, voluntary
through the rec*
of
fact-finding
when
President
Cleveland proclaimed
the leaders of riotous mobs of
arbitration and
ommendations
commissions.
From the days
"public enemies"
there has been a growing need
and a., growing demand to estab¬
lish the* supremacy of the public
interest and the public law over
the private interests and private
workers
be
to
labor
and
when
business
of
they try to mislead workers and
businessmen against a well-tried
of industrial peace which
program
true friends of labor and of busi¬
Management! are advancing
ness
order that labor and manage¬
in
ment
together may seek and gain
justice without suffer¬
economic
the
ing
hardships of
and
losses
which
warfare
industrial
ilized
r'
b
-
*'•'
'
'
"
*
civ¬
a
have
society should
lawed long ago.
out*
'
"
.I!
•'
*;'•
•,*y_ vt
/
Emery Named Sec'y of
Amer. Ghent. Society
Election of Alden Hayes Emery,
as
business
and
Secretary
man¬
of the American Chemical
Society has been announced by
Bradley Dewey, President of the
ager
following
Society,
meeting of
a
the Board of Directors. Mf. Em*
ery,
of
Bureau
States
of
official
former
a
United
the
Mines,
succeeds Dr. Charles Li Parsons,
who retired
Dec. 31 after serv¬
on
ing the Society as secretary for 38
years and as business manager for
14. Mr. Emery has been the So¬
ciety's Assistant Manager since1936 and Assistant Secretary since*
1943. In 1927 Mr. Emery went to
Washington to take up admini¬
strative
work in
the Btireau*
When he resigned in 1936 to be¬
come
assistant manager of the
American Chemical Society, he
was Assistant Chief Engineer of
the Bureau's Experiment Stations
Division, Mr. Emery vwas Secre¬
tary of the American Chemical
Society's Division of Gas and Fuel
Chemistry from
1933 to
1937.:
From 1924 until this year he was
an
abstractor for
"Chemical Ab¬
stracts,^ ^publication of the So-=
ciety
which
chemists
provides
American
digests
of articles
with
appearing in chemical journals,
throughout the world. Mr. Emery
was Assistant Editor of "Chemical
Abstracts"
laws of labor unions.
of
enemies
enemies
the
volunteer
They
army.
of these public
show themselves
They
the
clearly
labor law than
new
opposition
be
°
more
proves
for
enemies.
to
'
;
the need
Public
izations.
willing cooperation of all its
Nothing
of boss-ridden political labor ma¬
chines.
officers, however nomi¬
nated, must be elected by the peo¬
ple. But these;: labor politicians
.have no >uch fcertificate of au¬
thority. They are only national
bosses; picked by the local bosses
of half-free, half-enslaved organ¬
as
terdependent society
the product
in
charge
of its
fuel
section from 1931 to 1939. He also
The
Powers
of
Government
Without
zation than all the so-called labor
if
and
is
matters
suffering and
understand
and
alien revolutionaries?
and
law is sorely needed. Unrestrained
labor warfare is bringing untold
workers, all the
all
the
con¬
warfare is to the inter¬
are unwilling to give to this
high court, unwilling to give to
their government, the power to
preserve domestic peace and se¬
curity, the power to defend civil
rights against organized mobs, the
power to destroy conspiracies that
deprive masses of people of the
necessities of life, the power to
break
up the triple
alliance of
labor dictators, criminal gangsters
It
it should
think
who
.
calling the roll and
reading the long record, I will
summarize
it
in | the words of
Franklin D. Roosevelt, who did
more to strengthen labor organi¬
compulsory arbi¬
because the recommenda¬
tions of such
"
I am not trying today to per¬
suade you that the HBB bill should
be enacted by the Congress just
what
law, should be written.
If you understand how destructive
You
a
;
promptly
.United
the
of
new
-
•
written
be
statutes
the United States have been rec¬
the industrial
arguments of all parties, and
Federal labor
our
worth
not
to make uublic recommendations
an
decision.
;II; ■
It
■
controversy, to hear the evidence
had
settled by
must be
That is the principle which should
and
has
investigate
to
States.
that
enforceable
an
that grows into an ability to dic¬
commission
to
public authority they shall be
submitted to a judicial tribunal
which, after public hearings, will
opportunity
ernment
the
power and glory of the Murrays,
the Greens and the.Lewises, who
democracy
and free enterprise.. .Any power
preserve
should
into
controversies
kind
to
law
want
sive action until an
necessary
you
principle
Of our democratic, constitutional
government
that when private
minds
impartial gov¬
continue
'
cases the parties to an
dispute should. be re*
q uired to refrain fromi any aggres¬
;
will
work together.
It is an underlying
chant, between producer and con¬
sumer, between financier and bor¬
rower,
between transporter and
shipper—and everywhere between
management and labor—that are
unsettled
and
management,
\yhich have undertaken to rende?
that
There are, however, two classes
of labor disputes in which peace*
disputes where
seizing the properties of .oil com¬
panies and of a local transporta¬
tion company in the city of Wash¬
ington. ,
t In such an intolerable situation,
some outside force must be em¬
which
those methods
use
persuaded that such
developments. I
fl
.First, the expansion of
cent
•
to
fighting one another.
know these few things,
then it should not take much time
in such
because of two
citizens, and to require
of
to explain what kind of new labor
do
.
immunity from legal restraints,
and by the command of organized
If
cisions have been made necessary
cases
its
citizens
instead
in
employees who can,
proof of; their liberalism—and as nri ; insurance of will also be trampling, the Con- strike in a body is so great that
such
labor
organizations
now have
titution and Bill of Rights under
votes in elections!;;
'
!II"•'
! the power to paralyze vital public
There
is; one
saving
grace their feet.
The spectacle of a "labor bloc in services and to bring grave suf¬
among- industrial leaders.
In the
fering to a multitude of wholly
mass; they do recognize their ulti¬ Congress today cringi ng under the
innocent and helpless people,
mate
interest in the* impartial whips ,of labor lobbyists should
Second,
with
the
increased
writing and administration of law; warn us that tomorrow a majority
and they do believe in a free, of the Congress may be whipped power. :of labor organizations and
the absence of any legal respon¬
competitive economy; even though into line to pass laws to establish
as
individuals • they
frequently a labor domination—-and that sub¬ sibility for the misuse of such
seiek political favors and yield to servient administrators and courts power, we have seen, with in¬
nay be forcing the free men of creasing frequency, reckless and
thie temptations of monopolistic
attacks
upon
the
America again to revolt against devastating
power.
and
their
government
Labor leaders are generally suf* 3uch a tyrannical government, and people
through strikes which had to be
fering from the/delusions of rap-; again to fight for their liberties.
idly swollen authority gained by It would be wiser to fight labor stopped quickly by some, public
official to save the public from
political influence, by a special luggers in the streets today than
ized labOr*; hs
tlement of conflicts of interest be¬
tween
Compulsory Arbitration
'!. 279
'V- L
peaceful methods for the just set¬
ordinarily be made enforce-
Basis for
,
ment can preserve domestic peace
and good
order is to establish
The Need for New Labor Law
(Continued from first page)
down arms and :give conciliatory
i
*
.
leaders
of
today,
and
who
said:
President of the United
States in this generation has been
served from 1931 to 1939
Abstracts"
cal
faced by
the fact that when labor
are
strained to a break¬
ing point there remains but one
high court of conciliation—the
Government of the United States.?'
What kind of citizens
are
these
editor
dealing with
the
chemical aspects of metallurgy. I;..
As a member of the American
Institute of Mining and Metallur¬
gical Engineers, he helped to es¬
tablish
"Every
relations
as
of several sections of "Metallurgi¬
trial
he
the
organization's Indus¬
Minerals Division, of wheih
was
Secretary in 1938 and Vice
Chairman
in
1939.
He
also
-was
Chairman for several terms of the
division's committee
raw
materials.
on
chemical
THE COMMERCIAL & FINANCIAL CHRONICLE
rso
Thursday, January 17, 1946
Inflation in the Stock Market
4
'
(Continued from page 243)
that it is, tne market is
obviously registering the views of
large members of our people with
respect to the stresses and strains
that are apparent everywhere as
we
attempt;- to make the : great
mometer
adjustment from war to peace.
That
;
substantial .amount' of
a
Inflation already has taken place
cannot
be
which
inflation
denied.;; The extent to
is
furtherex¬
tended depends upon the policies
which the Government adopts or
fosters."• ■■■-■v-;/:'■ r".'
.
of the
lation
early thirties were
sound,
Briefly, they
end manipulation and
thoroughly
I feel, is great, but
information
dependable
and
the
credit.
won
peace.-
the
the
.
agreements with the compa¬
nies
whose
securities
are
its
on
not
tion
to
their
to
earnings and fi¬
nancial condition. The Exchange
urges that all Who use its facilities
avail themselves of this informa¬
as
tion.
-
Our capital markets are enter¬
policies demanded by a vain quest for unfruitful se¬
ing today upon a period of great
,' : ' '
conditions. The same is curity.
usefulness
and unlimited Oppor¬
How can the New York Stock
true with respect to the relations
A between labor arid; management. Exchange, and the other regis¬ tunity. 1 We must see to it that
these
markets
are kept clean and
tered
exchanges, best function to
We need to have, at the earliest
possible moment, a clear definition make this contribution to the ma¬ efficient, insofar as it lies within
our
power.
To the extent that
of the procedures for lifting' un¬ chinery of Organized society?
In two ways: First ;as efficiently their capacity to serve the public
necessary controls that will re¬
lease Our productive capacity in operated markets for securities of is restricted by defects in the reg¬
order
that it may supply
the our corporate enterprises; and, ulatory laws, we must and will
needs and wants of our people. second, as leaders in sound, mod¬ not hesitate to ask for appropriate
amendment:
But such revision
A speedy increase in production ern financial statesmanship.
must be justified by considera¬
As a market, we are providing
is the surest method by which
the dangers of inflation may be a meeting-place; for buyers and tions of public welfare.
v
We can expect no results from
sellers of stocks and corporate
reduced or averted entirely*
It is a function of the securities bonds representing a large part any/appeal to Congress that, is
based upon" nothing more than
/
market
to
reflect
the
concern of the wealth of America.
There is hardly a family in the "Please help me."
which these difficult problems are
There is a great social respon¬
causing.
It is absurd to blame United States which does not
the market for giving expression own, directly or indirectly, some sibility involved in the business
to the anxieties that arc in the of the securities for which the of
serving
investors.
Equally,
New York Stock Exchange pro¬ there is a great responsibility and
public mind/ '
a great opportunity in our func¬
It is my own opinion—and I vides a free and open market.The
social
realize it conflicts with that of a
responsibility in¬ tion of facilitating the flow of
great many people—that invest¬ volved in maintaining this market capital for the free enterprise of
tax
?
the
makes
New York Stock Ex¬
change nothing short of a great
service institution.1
/
are avoided.
This auction market is the hub
Nothing that is bad
for the economy of this country and center of a vast organization.
is good for securities and;any-- For the convenience of those who
securities is sound only to the ex¬
tent that the dangers of inflation
thing that is good for America is use it, its member firms maintain
good for the shares in American branch offices in 339 cities in 46
industry. Sound values in busi¬ States.r. The floor of the New
ness
rest on a healthy national York
Stock
Exchange is only
life.
In the event of disastrous minutes away from any telephone
inflation,. American corporations
will suffer along with t{ie rest of
telegraph
or
instrument
the
in
land.
the American people.
On
free
a
nation.
have
We
have
We
the right to cast
off
made
our
our
earned
sackcloth.
business
a
shining example of indispensable
public service, ably and honestly
performed.
In these days of our
prosperity we are not forgetting
a
free market in the sense
that prices in it are not subject
to artificial influences.
In these
days of greatly increased volume,
the New York Stock Exchange is
Moreover,
of the
New York Stock Exchange main¬
available to everyone.
the various member houses
tain, at great expense, staffs ex*
perienced in advising clients re¬
garding the nature and quality of
operating at peak efficiency. The securities.
standard
of ; business ;; probity
These experts have at their
among Stock Exchange firms is finger-tips a mass of financial and
not excelled by any business ac¬ general information as to the in¬
tivity.
*
'
*,%
* n *
vestment equity, the fundamental
Furthermore, under Exchange merit and the risks' involved in
requirements and under the Se¬ buying or holding almost any type
curities Exchange Act, there A is of
security. Of course their judg¬
ah abundance of pertinent infor¬ ment is not infallible, and no one
mation available whereby an in¬ can tell
just how any risk will
vestor may judge, or have some come
out; but there is no market
competent person judge for him, in the world where all the facts
the
investment
or
speculative about the
available
goods are
merit of any security which he more
readily or more quickly
wishes to buy or sell.
We hear available than, in this one.
very little
criticism of the ef¬
Neither
the New York Stock
ficiency of the stock exchanges
Exchange, 'nor
any
other
ex¬
today.
There
change,
must
be
no
return
to
pools, manipulation, irresponsible
offerings of worthless securities
and the days of inadequate and
incomplete information regarding
the affairs of publicly-owned cor¬
porations. Nor is it desirable that
America again should be plagued
by undue concentrations of power,
made possible through the loose
employment
of
other
people's
money.
The aims of the securities legis¬
valuations,debts, sinking; funds, and
1944-1945 sinking fund tax. levies
.
not fail
they will
.
these
times
you
their
when
does guarantee an
investor against loss; but it can,
can or
and does,
make the nature of the
speculative risk an open book in
so far as that is possible.
v
As
a
done
a
never
market
before
we
job,
good
been
always
have
but
have
we
able to
do
as
good as we are doing now. This
is because intelligent risk-taking
is
more
of
and
more
uninformed
speculation.
is at it should be.
our
taking the place
It
means
business rests upon a
This
that
sounder
development
that
influences in
cratic
way of life, are achieved,
large-scale reduction may be
nade in the number of occupation
"a
troops of the four States (United
states, > Britain,
Russia
and
France),
and
Austria
that
may
Progressively acquire the status of
in independent State."
§ The recognition announcement,
iccording to the Associated Press,
'ncluded
crom
the
text
of
wish
since
to
message
Truman
President
Renner, which read:
"I
a
extend
to
Dr.
to
-
you
my
trian Republic and my best wishes
in
task
your
of
completing
the
Mberation of Austria and the
vival of
an
^cratitc
State.
+*at
the
States
people
will
wish
can
assure
of
the
to
assist
tria in this endeavor."
the
in
offered
the
bonds
of
than
runner-up
to
yield from
able to
and
to 0.85%
0.20%
was
oispose of approximately half of
the issue on the initial offering
bonds
1947-1976
of
which
United
A
Aus¬
the.
the
Evangeline Parish
Board, La., to redeem in
advance of maturity date a total
of $55,000 bonds held by the Kan¬
sas City Life Insurance Co.
The
matter has been in litigation for
sometime and, according to New
Orleans press advices, the latest
decision
holders
favorable
to
the
bond¬
given wide currency;
by J., E. Roddy,
President of the Louisiana Secur-.
in
was
bond
circles
ity Dealers Association.
Public
On that
occasion* the
ful bid was
IKs.
a
;
Utility Securities
the
In
recent
to obtain
102.44
a
price of
arid Puerto Rico
gone
come
latter
due to
a
the original sales.;
had to be canceled
from
the
,
cable
by American Cable &
is now on a stronger fi¬
nancial basis.
Radio)
It may be
added that the com¬
bidders also sharply re¬
,
Profits
business declined due to the war,
but the jzable system (now con¬
trolled
technical error In the
bond offering advertisement.
peting
downhill, but Chile has be¬
an important source of in¬
come.
Harris & Co., which entered the
at
of $187,000 in 1937. Peru
seemed to have,
loss
a
less than
IK'S from the same
headed by
Stranahan,
bid
pretty well on bal¬
Cuba for Instance showed a
profit of $927,000 in 1944 against
ance;
for
group,
(outside the Argentine)
has also done
success¬
re-adver¬
was able
no
telephone business in Latin
America
price of 100.57 for
tised offering, the city
The
were
originally sold last Nov. 13.
vised
upward the offers made on
the occasion of the earlier offer¬
International Telephone should;
time by. the recovery1
benefit in
of its European properties, largely;'
undamaged except in Germany:
account headed by
and Austria. But the electronics
the Provident Savings Bank &
venture in this country (FederalTrust
Co.,
Cincinnati,
which
Telegraph) may meet some heavy
placed second in both instances,
from other
strong
offered 101.73 for IKs in the re¬ competition
contenders in television and re¬
cent attempt, as compared with its
lated fields; such as GE, Westingprevious bid of 100.52 for IKs.
Similarly, a Halsey, Stuart & Co, house, Radio and Bell. Without
benefit of huge war orders, the:
account
raised; its
terms
from
business, may temporarily drop
100.454 for IY2S to 101.15 for the
same
coupon.
This transaction off, but nevertheless has good *
perhaps best illustrates the sharp possibilities. linked with the fu¬
ture growth of this important "in¬
improvement pricewise that has
been recorded by the market as a fant industry." International con¬
trols
many valuable patents, and
whole during the past few inonths.
ing. Thus
an
has its finger in many important
'
In
ket's
connection
;
activity,
with
"it
the
mar¬
scientific
should:; be
;
added that the continuing bet¬
terment in the price structure
has served to stimulate
of
both
dealers
and
overhanging
the
:
investors
market
for
District, 111., IKs of Dec.
1, 1965, and becoming optional
beginning June 1, 1948. Both of
were recently fully
distributed, although the under¬
writers had been carrying sub¬
stantial
balances
for
several
'A. ;
R. J. Edwards, Inc., Terminal
Building, Oklahoma City, Okla.,
new
ings
may decline moderately from'
$1.22 reported in 1944—per-,
haps to around the $1 level.- A
the
refunding next year might
about 10£ per share. Un¬
fortunately the system will ap-,:
parently not gain much benefit
from the new tax law, though this
point is difficult to analyze. The
parent company's financial struc¬
ture has been strengthened in re¬
cent years despite the ravages of
war, and its potential comeback
in Europe and the romance of its
big
"electronics"
venture
may'
the
stock
speculative
Debt Data Compiled
a
The nine months' interim report
lend
Oklahoma Municipal
prepared
edition
re¬
recover
Is of 1950-1964, and the Chicago
have
its
bond
time. Among these may be
mentioned the Baltimore, Md.,
some
;
developments;
search staff seems one of the best.
seemed to indicate that 1945 earn-:
interest
in various items that have been
months.
you
Court /which: denied
of
School
(Continued from page 248)
ropean research staff to this coun¬
day.
The
City
of
Toledo,
Ohio, try and building up Federal Tele¬
profited handsomely from the ne¬ phone & Telegraph; which in 1944
cessitous re-offerings of the $200,- earned for the parent company an
000
grade crossing; elimination equity of $6,542,000.
re¬
independent and demI
more
these issues
President of the Aus¬
as
price
a
only $22.89
Park
..
congratulations
election
bid
group
& Co.,
tender of 101.538 submitted by an
headed
Austria and promotion of a demo¬
a
account headed by Halsey,- Stuart
& Co. The successful group re-
Government,
of Nazi
which
or
afforded
The
Russia and France, the
Associated Press reported from
Washington, adding that recogni¬
tion does not, however, affect the
authority of the Allied Council,
which will continue to carry out
Allied objectives in Austria, and
which -in a resolution last month
recommended recognition. A The announcement stated that
is the Allied objectives, including
ruling of the United States
District
right
by John Nuveen
101.5425,
in
Britain,
,
bonds by Indian¬
The award went to
Chicago,
J
Bondholders
maturing yearly from
1946 to 1965 inclusive, attracted
12 separate offers, all naming a
1% coupon and, with one excep¬
tion, specifying a price better than
101.
;
Evangeline Parish, La.,
This loan,
headed
.
possible
Decision Favorable to
of¬
recent
more
•'*
access
to the record /
for
any
one
unit is
in the
'
mar-
county
by reference to
alphabetical index provided
forepart of the survey.
an
apolis, Ind.
Allies Recognize Austria
elimination
tempo of the
each
The U. S. Fifth Circuit Court
in connection witli; of
Appeals on Jan. 9 sustained an
of $500,000 airport
earlier
award
the
proper
by
Chancellor Leopold
Figl and President Karl Renner
•eceived recognition on Jan. 7
!rom the United
States, Great
the
of
furnished
top
Austrian
Quick
made
levels consid¬
for
political subdivisions.
desired
in
issues at
in
some
tional well-being.
The
1
ferings. A good example is that
vital to the na¬
so
a
collections
and its
ket has been vividly illustrated
be proud of our markets
can
and
at the alltime peaks
May*. 1945, and in
few cases, dealers are prone
bid
;
to. • assessed
bonded
are now
'v'stfheWoiiff
during the days of our adversity.
You
♦
ket is
respect
erably above the. averages.
the hard way
the lessons learned
functioning is
Exchange,
highly trained, respon¬
the floor.'of the
Returning, to the Stock Ex¬ through
change itself, our aim is to keep sible and ethical brokers, any in¬
it the worthy servant of Amer¬ vestor can buy or sell any listed
ican industry and American in¬ security:
There are traded the
vestors.
It is fair to say that the highest grade bonds and stocks,
New York Stock Exchange today and speculative, as well as all
is exercising the function of pro¬ grades iii between these two ex¬
viding an orderly market for se¬ tremes.
curities better than at any time
The securities are clearly
in its history.
Information regarding
It provides a con¬ marked.
venient and efficient public mar¬ them is.readily and conveniently
ket for listed securities. That mar¬
.
the State..The data includes stateihents as< of June 39/1945, with
in the tenor of the bidding for
postwar
ment in common stocks and other
ing,
established
Sur¬
wealth of sta-'
information pertaining to
the, financial
condition
of
the
various political / subdivisions of.
prices. The latter, generally speak¬
list under which they make avail¬
able periodically factual informa¬
Financial
a
tistical
.
has
"Oklahoma
vey," containing
,
part of Congress and the .abundance / shall be counted "V a
We
executive branch of Government blessing,; stagnation, a ;sin.
must again reward the venture¬
; in various directions. The Gov¬
ernment has yet to come to grips some and cease to encourage those
realistically with the kind of fiscal who would bury their talents in
and
their
:; Free markets
facilitate
on
For this condition both the
Exchange itself and the Securities
Exchange Commission share
;!
A,'A
A//;*' -jA A / Taking its cue from the con¬
are open to all; as
to the investor. The investor was
tinuing strength of the govern¬
to
be
protected against sharp they should be, but, as I have ment bond market, the market for
been pointing out for some time,
practices.
Let us keep in mind,
obligations of States and munici¬
however, that Congress had no access to them should not be palities has maintained the highly
intention of discouraging the in¬ abused/ The country and our ex¬
optimistic tone that has been its
vestor - from * taking;r legitimate changes will be better off if those
most'; significant.
characteristic
.business, risks..
.
,
>:. AA;' A who are unable to! judge intrinsic since the close of the Victory Loan
Our
capital markets ~ have/a values, or who are unwilling to drive. The demand for local taxhighly important part to play ^in be guided by facts in appraising exempts is extremely broad, de¬
advancing the enterprise system values, will stay out. • -A' A
spite the constant narrowing of
The New York Stock Exchange
in these fateful years of newlyyields as a result of advancing
to
were
provide
They are needed to
gathering; and ser¬
it is susceptible of control.
To
prevent a runaway inflation will vicing of the capital necessary to
'rebuild
a
better world in which
require the most resolute attitude
The danger,
base.
of
some
appeal
measure
of
to
long-term
holders, despite the fact that the
oresent price level appears high
in
relation
earnings.
to
estimated
1945
:aa
V;^ t'";\
.Volume
■'..
•
163 ' '■
^ m-'v
:
'■' ! V!:";
f'-V '■
?•'■ ■
■X
V«i:-"'-:A
^-.w; -J,
COMMERCIAL & FINANCIAL
Number 4456 ;% -A* AAA'' .AAa^AK^VAA ■'; THE
Tj
'■aa;
,
''i* '!
:'%
',V,"
CHRONICLE
281
TABLE HI
The Government, the Banks and th? National Debt
"
r (Continued from page
Ah/; address
made by Dr. Le16, before Institute
of. Business and Economic Problems, University of Pittsburgh.
The views expressed in this article * are purely personal.
They
land
■A
v
.
not
are
be
to
attributed
to
Beginning
gradually
declined
A is
connected.
The
writer
is
in-
A debted to Messrs, L. W. Mints and
John
K.
Langum for numerous
suggestions and criticisms -of this
manuscript, A They, too, are not
responsible for the author's ideas,
errors or judgments.
/V1
■:
,
'
.
,
,•
deposits- and other factors.
The
larger
the
debt
becomes
the
greater its impact upon the economy, and the more vital the debt
and
1930
tributed
June
to
to
+ 1918-.-
the
ceed
r
A management problems.
On Dec.
s
tional
This
-
debt
is
to
be
1943—
serve
debt
with
amount
the
gregated
over
the
books
yet
be
War
II
has
ag-
$235,000,000,000 and
on
costs
war
closed.
can
World
In
not
War
I
'
(between
to
national
|March
other*
as
tJune 29.'
}
mutual
savings
38.9
from
and
Treasury*: Bulletin,
the
holdings of the
■
ment.
national debt
was
but $1,200,000,-
attractive to these^ companies—a
tendency which contihued
throughout the depression. When
At the present time ti looks
market,
large quantities will probably be
purchased
duction of current taxes. For
as
will be
by commercial banks,
they are eligible to own
The
Federalobligations * com¬
prised only 1.5% of total public
and privateJ debts.- The percent^
.waripreparatioris' comm^ncbd
1940, over 19% of the assets of
the major 49 companies was in
the
by
$25,315,000,000.3
The
legacy
in
of
Bonds Owned With Total Assets of 45)
Relation
Total
to
Public
Private
and
Legal
Reserve Life Insurance
Companies: 7
Debt
*
'
1929-1945
r
-
•.
and Federal Agency Debt $>.
Total Public and Private Del# >AA
-%A: AAA7/X/AXXX X"'/■ 'Per Cent A
t
Amount (in
/
Year
-
,
billions of dollars)
391e„*.
■;
1916
$81.1
■
-.—
.—..— _—
190.4
w*. w'--'u:
i935«.-.'—
163.2
;A
200.4
——
3S42^_.i_„^_^_„l,r
3943
A .1'7
7 '•
,
162,000,000 per year: The effective
interest rate assumed in this and
num.
definite fiscal
numerous
—
100,0
100.0
302.8
100.0
361.7
s/lS44i«A:^——-—
r
.
and
20.6
'47.8
v
;
;
>48.5-,
147.0
100.0
1930-;%
1931—
37.8
.
1934—
20,110
21,385
22,900
24,142
,
1938.78
due not alone
was
17,247'
to the; decline in private security
offerings but also to the financ¬
ing of relief-recovery programs
primarily by * public borrowings.
In 1940, Federal securities com¬
prised 20.6% of total debt instru¬
ments, and each year the percent¬
age has increased.| Public secur¬
investments of. $149,635,000,000, .of
which:; $93,657,000,000,
or > 72%,
in U. S. securities;!*' On Dee*
were
31, 1940 bank loans and invest¬
ments totalled $54,lfO,000,000, of
which
$20,983,000,000, or 38.7%,
obligations.12 Be¬
in Federal
were
tween DeC;
31,71940; andTJune 30,
1939,1.
1940—f'
{
;
1941—
; 16.1 '
,4,363
,
4.2
12.7
-
18.1
4,646
18.2
5,063
18.9
15,493
A 6,414, I
8,739" >
19.4
21.47% V
27.4
,,
34,400'
11,698
1944...
37,265
15,277
41.0
*1945..
40.600
18,900
46.6
>
34.0
7l
?
^
^Estimated.
Data 8 taken
Thirty-sixth
from>: Proceedings
Thirty-seventh
and
of
the
Annual
dom¬
Meetings of The Association of Life Insur¬
ance
Presidents, New York,
New
York
inate the market for debt instru¬
ship of U. S. government securi¬
16,
have
and
thus
come
to
considering the size
Obligation y this
-dominance may continue for some
years.7
■
;
' ^
ments,
of
;
Federal
the
.
.
,
Ownership of Federal Securities
ties
increased
nant/asset of
346%.
our
The
domi¬
private banking
?„ec-
in the
and
secured
by
letter
from
Sta¬
tistical Department of the Association of
LifeTnsurahce;Presidents. •
M
.
No additional data need
be cited
to
indicate
the
tremendous" im¬
portance
government
securities
Prior to World War I and the
importance of
have assumed in the economic and
public debt instruments is visible depression of the Ninteen Thirties,,
financial life of the
The
increased
.
at every hand. Federal securities
have been acquired in increasing
volume by individuals, business
banks existed mainly to provide
This
banks, financial corpo¬ ities to private borrowers.
rations, insurance companies, trust was true even during World War
funds, 7 state and local govern¬
J,7 during whichi tiriiejthebanks
ments and other institutions* What
had only about' 11% of their loans
has become the collective obliga¬
concerns,
tion of the United States has be¬
come
cases
of
its
primary asset—in some
the major form of saving—
a
citizens
and
their
enter¬
prises. Twenty-seven million peo¬
ple
subscribed
to
war
bonds
through payroll deduction plans.6
At the end of September, 1945,
the
amount
of
Series
E
United
States Savings Bonds outstanding
securities* Instead of
custom¬
Buy,"- aptly
ginning ' of World; War
de¬
II,' how¬
the main function of banks
the
1940
them,
but * with
concentration of owner¬
as
financial institutions
interest will in the future have to
scribes the situation. Since the be¬
financing
Federal government.
come
be
made.
the %
•
of
the
Beginning in
(June 29) bank investments
In
August, 1945, when
total - interest-bearing debt
$261,261,000,000, almost 43 %
the
aggregate was owned by
banks, including the Federal Re¬
System and mutual savings
banks; 8.2 % was held by insur¬
serve
ance
ance—38.9 %—was
in U. S, securities rose from $19,-
corporate, arid
ment
666,000,000
ors:
Bank Ownership of U. S.
\
A:
■
' Securities Axiv: ■> ':
Ail banks in the United States,
on June 30,
1945, had loans and
to
$93,657,000,000 'by
held by
other
individual invest¬
The amounts of the
respect¬
ive
in Table I. It
demonstrates clearly
Table IIL These distributions hold
the major importance" of govern¬
ment securities among bank as¬
relative to the payment or rrian-
sets. 7
■
■
■■
77; -'A;/;
XA-
Clues
to
aritmetic
are
many
also" shbwn
future
agement of the debt."
% *
%
in
problems
A
<•>
;
of
the
negligibly. Other generations than
our own may have different ideas
concerning debt repayment; other
and distant years may, bring, con-,
ditions under which debt expan¬
sion
are
the order of the day.
loans
-
the: Federal/Reserve
from
System., They have already sold
the "Fed" the bulk of the Treas¬
bills and
ury
a
considerable share
Statement of; the Uc 8. Treasury.,
On March 31, 19l7;ttte,;
$1,282,000,000; on Aug. 31, m?
highest war peak—the best was $26;-
3 Daily
Nov.
1, 1945, p. 9.
debt
was
its
597,000,000, "
.
''
5
Slater,
Pattern in War and
rent
for
or
makes
difficult
it
Reserve System to. use
trols
now
for
the
the con¬
ait its disposal to
prevent
the generation of inflationary tendenciesri The banks, has 4h$ rules
expand their cred- '
the:central banking
authorities like it or not./
A %
now
its
stand,
can
whether
This: botential
vability s of
the
banking system to feed an infla¬
tionary; boom : adds > an additional
force to the other factors already
lurking in the present situation.
The continuation of fiscal deficits,
the shortage,of civilian goods, the
unused backlog of savings
and
pent up purchasing', power, the
store of available personal credit,
the accumulated demand for
con-
sumer's goods of every kind,
propensities
premature
labor demands, the
Debt
Peace," Survey of Cur¬
9
25, No.
(September.
1945H::;p. - T4,
6 See table above;
discount of Government secu¬
rities
Vol.
Business,
States
"United
Alvin,
ity
the ■ banks to, secure funds
credit expansion by the sale
Jr
»
-
4
issued during the war.1* The abil¬
dominance
7 The
will
be
also
financing
private
extent
that
A
;
A
>
Federal securities
by the form which
of
affected
tends to take, r To the
stocks and similar
common
equities .replace debt instruments' in corpo¬
rate financing, the relative importance of
the public debt may be further Increased.
v
,8 Treasury.
^
Bulletin,September,1945,,
November, 1945%p: 36./7. *
v/
i/aoIbid.; p. 49.%'- '■/ 7- •
^ ," <• "■ • A/
A 11 Federal Reserve Bulletin, November,
:
9 Ibid.,
p. 1124.'
12 Ibid. '
1945,
.
>7:;
'7
.?■ V ,■■■<%
S-V
August, 1945, the commercial banks
owned $84,500,000,000 if the $261,261,000,r
000 interest-bearing U. S. securities—32.3%
of the total.
Ibid. Cf. "The crux of the
Federal, debt management problem, for at
least the next decade, will be the position
of the commercial banks, the volume and
character of
the
Government securities
that thq course of events, will lead them
::
13 In
to
hold,
securities
Charles
the; and the
and the rate of return on such
that the Treasury
will pav."
Abbott,
"Commercial Banks
C.
^er2al6Dfoe^rmt?e
Banker>
of; ^on'Aug".
re-
standing
31, 1945; Treasury bills outamounted to $17,038,000,00c1 of
•alIoda-:%•
which' $13,254,000,000^ or%78 9fc» zwcie held
duuw
by Federal Reserve Banks.
Certificates of
v indebtedness
outstanding
on
that date
as
were $34,430,000,000 of which $6,400,000.rrmtrn1«r all rontribute to the dan-'; 666> or 18,6%, were, held by Federal Recontrois, all CpniriDUreiO uieoan t
-Banks..*' On June
laxation
wxduon
rationins
rduumiig
of
M
and
dim
materials, as well
the reactions against wartime
tions for various
30,
June 30, 1945. This trend is shown
holdings
political
and
tech
institutions
financial
companies; 10% by Federal cost-increasing
agencies and' trust' funds. The bal¬
investors other than banks,
insurance companies and govern¬
agencies held over $101,582000,000 of UA S. securities.16
The
concerned.
are
was
been
nation.
among
ship soTar
of
has
t
marked
"Borrow
ever,
that
uted
bonds. The slogan of that period,
000.9 At the end of
the
States
moriey withA which; to buy
and
in
financing the
government they loaned
ers
,
moreover, is widely distrib¬
They have be¬
the rentier group to which
primary payment of principal and
and investments in United
Was
approximately $29,870,000,August (1945)
the Treasury survey of the owner¬
ship of Federal securities indicated
people and
institutions
deposit services and credit: facil¬ debt,
drive
It should be re¬
$5,801,000,000
problem is, however, that the
longer the amortization period se¬
lected, the greater the certainty
that the net debt reduction will be
of the certificates of indebtedness
Holders of Public Debt
public debt instruments of
the United States.
1942 and Dec. 2 and 3, 1943, pp'.
20;
system is their present investment
in
or
is
membered, however, that this is
only arithmetic.
The economic
and will continue to be the normal
8.6
(
3,692
.31.884
^
"
805
1,738
25,495
26,847"
28,249 v•'
,
•
2.2
2.722
-
29,937
1942..
1.9
-
1945 bank loans and' investments
increased 139% but bank owner¬
ities
The
utilized
ordinary
costs
years.
rathier than reduction will 1^
.If there is
subscribers :and underwriters of to be net debt reduction, the pe¬
Federal securities:. ; If. the: debt riod for amortization must, on the
continues to grow'.during peace-/
average, be short.
time, or if non-bank owners sell,
Since little reduction can be aebank: ownership, of debt instru¬
ments can be expected to increase.
1 Daily Statement of the U. S. Treasury,
Gross debt as shown hera
On the other hand, if these insti¬ Jan. 2, 1946.
does
not include guaranteed obligations
tutions have also to supply simul¬ not owned by the Treasury. % •
.y
7
taneous 7 credit needs; of private
2 At the close of the fiscal year on June
industry they may sell "govern¬ 30, 1940, the gross national debt was $42,967,531,038.
Annual Report of the Secre¬
ments" on the open market, may
tary of the Treasury on the State of the
refuse: to renew subscriptions as Finances for the Fiscal Year Ended Ju»e
issues mature, or they, may use 80, i»44, p. 627. (Hereafter referred to as
Annual
Report of the Secretary of the
Federal securities as the basis of
Treasury.:A >.;■ 'V'- ^ L
A":' 1
other
1.8'
'•*
356
421
1943--
-
deficits.
Dollars)
i ,303
,
/
18,988
19,259
1935—
1937—
Slater, Ioc. cit., p. 14.
This increa&
j i
18,411
>
1936—,.
"56.7
205.0
Admitted
1932^1933—7 %
23.9
im&i
8
cover
50
If 100 years is
selected, the annual debt charge
nique will be reserved for emer¬
gencies, but ta£ issues and sav¬
Per Cent 7+
ernment 7 Bonds to
ings bonds may always be avail¬
Bonds; Total Assets 7 able? Nevertheless, banking, and
* $316
2.0%
1
I
7.8
of
be
can
to
interest
annual
meet
within
; U. 8. Gov-
•1929*-^ "$161,002
15.9
36.9
(A
100.0 %
'
'23.5
26.0
:
Millions
drives
given is
jumps to $15,289,000,000 per an¬
If a longer period is selected
the annual charges may be re¬
duced. It will cost $7,956,000,000
to retire: a $250,000,000,000 debt
Without attempting
predict the-course of, future
Federal finances or espouse any
casual
here
If 20 years is selected as the
retirement period the total charge
wise stopped,
peacetime
illustrations
2%.
to
tion
ex¬
a
$5,000,000,000 annually, making
$11,-
other
' Ownership
■\tai'.
1.5%
20.1
"if 17.6
in
Total
>
and Private Debt
25.5
m 14.8:
'
100.0
(Amounts
"
■
of Total Public
$1.2
i
300.0
247.8
f
billions of dollars)
»
,100.0
;
179.0
1940—J
3941——
•
.
'
100.0
•
133.9
;
Per cent
...100.07*
126.6
—
•
1930——
Amount (In
,\
s
ap¬
total debt-service charge of
a
•
Outstanding- Net Federal Debt In
Substantial reductions
be added, interest payments
must
commer¬
has ended deficits have like¬
said that
aa
$250,000,000,000
debt in 30 years, by sinking fund
methods, would require a fund of
$6,162,000,000 per annum to whicht
cial banks may be expected to add
their holdings if, during the
war
t
costly—far too costly it
ample, to retire
Other financial institutions,
including A the Federal Reserve
Banks, will probably also acquire
additional amounts.
: ■'/.
taxpayers to desire debt
redemption in preference to re¬
policies, it may be
Treasury def¬
icits are likely to -recur in - the
age rose to 20.1% in 1919 which "governments"; by 1944 the per¬
of
our
aggregate
public debt
years ahead. Some may be inten¬
point was not again reached until centage had increased tb^ 447 arid
from World War II is practically
tionally planned, tothers may be
1939* although the relative impor¬ in 1945 U. S. securities consti¬
entirely
unforeseen.
To / meet
ten times greater than the debt tance of Federal obligations in the tuted A 47% ; of
admitted assets.
them the Treasury will have to
total debt structure of the coun¬
These data are shown in more de¬
left by World War I.
rely in increasing degree, in the
tail in Table II.
The economic depression of the try steadily increased during the
future, on security sales to private
years
of
the late depression.6
financial institutions.
1930s also left its imprint upon
TABLE II
It is un¬
These changes may be seen from
Comparison of United States Government
likely if popular bond-subscrip¬
the debt of the national Governthe following table:
Aug. 31, 1919) the debt increased
r,
pears for
curities. Beginning in, 1933, gov¬
1916, when the
<."■
••
generation,
proximate years of peace, the na¬
tional Government covers its fis¬
cal deficits by
borrowing. It can¬
not be assumed that because the
In
,A
eral securities ih the open
far
it
though .there will be little net
debt redemption within the next
com¬
to
outstanding.6
as
Debt Repayment
them.
more
and
more
Thus,
irrespective of the course of trade
cycle, the ownership of Federal
securities by the banks is now the
central problem in debt manage-
f
| sayings
taken
put
securities in the banks
covered its deficits by loans.
100.0
banks
doubtless
more
/
surance.
ernment bonds began to look
all public and private debts now
—T-—>—% $2GL26l
"
10.0
come,
deflationary tendencies*
would
'
►
•
the
even if deflation
mercial banks,13
In the future,
when non-bank holders sell Fed¬
so
companies. In 1939, only
2% of the admitted assets of 49
major companies was represented
by the Ownership of Federal se¬
and 000,
1917
31,
each:year'except
30:of
noted.f
:
constitutes .56.7% of
now
stock
around
The; same tendendy is visible in
the investment policy of life |ri-
indebtedness of the Federal gov¬
ernment
U
.
<'Gqveraments,,A7.fi
the
World
of
cause
v
of
72.2
come
'
j
'
? Perhaps the most crucial
prob¬
lem of debt management revolves
,
69"7
Insurance Company Investment
in
public
economy is
$43,000,000,000, the
outstanding debt greater than ever before not only
because of its absolute size and
A on: June 30,-1940, when the de¬
fense preparations for World War the resulting interest burden, but
also
because the relative position
^ II ;werebegupv inearnest.?;: The
of the public debt has grown. The
I increase in the national debt be-
pared
?
.
65 7
.
.
Bulletin, December, 1944, p. 1206November, 1945, |).' 1124. 7 7 v f.
ibid.,
of the,^
the
7
57,748
75,737 7" 7;
93,657:
129,639
+ June
importance of
47 3
1
*
Data taken from Banking and
Monetary
Statistics, .Board vof Governors,- Federal
Reserve System,. 1943, p. 18; Federal
Re¬
wars.
Importance
30,301
,
87,881
1945—
Public Debt
The
com¬
64,009
,
40.6
;
*
:
1J
November, 1945, p. 49 and Federal Reserve
Bulletin, November, 1945, p. 1138.
> i f f ! ;l
19]66638.3
V 23,521
' 8.2
Trust Funds 2—u._.
26,353
All other
investors...101,582
"Includes
--
4.0
22,530
21,555
i
Total
1944—-108,707
$1,-
Agencies and 1
Data
1942—
wise
Increased
Loans and
:
1941—-. ;; 57,946 .7
'
31, 1945, the gross nawas $278,000,000,000.!
indebtedness
actual
;
-
8.
31,814
+1940-/. ; 51,336
626,000,000.
The
internal
war
against depression ranks debtwise with
Growth of the Debt
to Total
+1929.
1932
attribut¬
indebtedness
U.
1920-i
ex¬
able to World War I by over
U.S.
'
.
Insurance Companies.
of u. s.
-.7' Obligations
"7
::
Federal Reserve Banks
30.3%
10,392
,
activity within
inflation should
Total
$79,049
.
of
tne
responsibility is not lessened.
Nor would deflation end the
prob¬
lem of debt management for the
Treasury, in order to help over¬
>
tin Millions Cent of
Commercial Banks^.l.
Dollars)
?Date;: ments
7. 820,788
.
i
:
'
Per
level
^nomy .And
rather than
7
-
•Tj^e'pf'bivestorf>,';>,.vV>;iof;DoUaM)
1914.
overcome
and 1940
1930
of
and Invest-; Government
.
^
depression,; -the $26,941,000,000 added: to the public
between
Millions
TotalLonns
;> Ki:
economic
debt
in
;'7^77;77;5 Ratio
30,; 1940 are at*
efforts
Obligations
"Savings Banks
(Amounts
,
Amount
Owned
Government
deficits were
and recurrent
adopted to stimulate production
and employment, the debt rose
steadily until June 30, 1940, when
military preparations gave it a
further upward impetus, f If the
debt increases between Dec. 31,
any
States
Onned by all Banks in Relation to i
)Tptal'>. Loansand Investments' 7::; 7 '(v;
u n t i 1
it
$16,026,000,000 on; Decr 31,
1930.4; Thereafter, as fiscal; meas¬
Institution with which the writer
•
United
reached
ures
/■a'i
TABLE I
242) .■
r,ebt
ment.
Jan.
on
the
Ownership .offU/. S.-:, Interest-Bearing ft;
: •
Securities,: Attgr. - 31, 1915 .
fA
1944, the Fed-
Some of eral Reserve Bftnks heid but $3,382,000,000
the reach or iV7%, of the outstanding certificates
Of monetary mechanisms but cer- Of .indebtedness.
Over time the amount
ger of postwar inflation.
these factors are beyond
iain
U
-
it
IS
+V.O+
that
fhncn
these
authorities
cannot vacate their responsibility
lor
trying to
staoilize prices and
and
percentage
been increasing.
of
these
holdings
have
Cf. Federal Reserve Bul-
letin, November, 1945, p. 1138.
(Continued
on page
*
282)
•
.
THE COMMERCIAL & FINANCIAL CHRONICLE
282
Thursday, January 17/1946
chases, large volumes of 2 % %
The Government,
(Continued from page 281)#
the Banks and the National Debt
the
forth
same
from
concern
rise
in¬
debt
debt.
be
depends
portion
that
large
How
should
the be¬
of retire¬
primarily by
ment
and
is
fixed
to
the volume of tax-
"
notions
as
atiori to be "suffered."
*
of
advocates
>
*
thinks that
billion dollars per
devoted to
year
One of the
retirement
partial
one
paying
off
the
:/ debt, exclusive of interest, would
meet the situation "as something
*
# to start en." *5
Such token pay-
/ ments would extend
the debt
re¬
demption process over 275 to 300
'years depending upon the size of
J the debt.16
It is unrealistic, indeed, to talk about paying off the
*debt year after year at the rate of
*
#. a billion dollars
*
per annum,
al-
though in certain years that might
be an appropriate payment.17
It
;
not
as
upon
liefs of the proponents
should be clear that if
a
real re-?
# duction iri the national debt is to
*
be
accomplished
in
the years
# ahead, the payments will have to
'/ be much larger and the resulting
amortization period will have to
'
be
comparatively short. # Other¬
wise the plans may be upset by
*
domestic of international strife, or
even by recurring depressions.
If
the debt is only to be whittled at;
contribute
to
flation, and if possible to set up
counter pressures to prevent in¬
flation.
The Federal Reserve Sys¬
joins the Treasury in this ob¬
jective.
Both agencies want sta¬
bility of prices for all goods and
services, as well as stability of
tem
prices for government bonds. At
times, however, a choice between
these may h&ve to be made. Then,
general economic stability ranks
ahead of stability in bond prices.
/ The Reserve System, as you re¬
call, was set up, among other
things, to exercise price controls
via
bank
and
reserves
trend and to protect their
earnings by lengthening the ma¬
portfolios. Never¬
are
table
turities in their
which these ratios
on
theless for the
shown in Table IV.
also
shows
that
holdings of
public ' marketable securities arid
maturities
erage
the Federal
on
(Amounts in
;
Millions
of Dollars)
// tGross
♦National
Year
Income
1929
83,326
1932_„
;
/'
19,487
77,574
"
1941___-___/.i„_
96,857 $
1942
i
121.568
Y
42,968
48,961
■;
of
measures
Congress—
•Estimates
to check in¬
fiscal /controls. The Treasury de¬
sires
also
of Department "of
81"--
1.15
1.04
;
1808.2
Commence, Survey of Current Business, April, 1944;
tAnnual Report of the
October, 1945,
t Annual '
3.
p.
Secretary of the Treasury, 1944,
664: Treasury,
p.
1
-
s
Report of the' Secretary" oLthe Treasury,
*
^
■
„
/possibility.
to be
a
remote
We must rather find
consolation and pride in the
our
wise management of
obligations.
the national
,
.
'
Conflicts in Debt Management;
:
/
i Even In the management of the
debt* there are important conflicts
of interests among the parties in¬
volved.
Private
holders
desire
-
1944,
sioii {of short-term
its
first* step,24 / When: the; war came;
the • Federal .Reserve
Banks
act
own
in
into
cash.
issues
are
The
non-marketable
redeemable
at
fixed
prices, funds for which must be
Secured either
by taxation or new
borrowing./ The holders of mar-f
ketable / securities /'hope / that /the
market
may
be supported,
or
other arrangements made,' so as
to prevent capital losses from ac¬
cruing to owners who sell prior
;.to maturity. -They also hope that
the guarantee against capital losses
#
may
be
secured/ without
bring¬
ing about reduction in the rates of
'interest paid. The Treasury should
probably be little concerned with
the
price of its securities before
maturity—why should it be—for
non-marketable issues with guar¬
anteed
redemption " values ; have
/been made available to purchasers
with limited means, and to those
Who may: be unlikely to hold td
maturity.
On the other hand, the
Treasury may be induced to ex 7
-hibit concern over the daily price
M its securities, should market
prices fall, by arguments that de¬
clines below par may affect the
sphere is endeavoring to
the national interest.
possibility
of
conflict
This
of
course, never eventuate, but that
it" could happen adds strength to
arguments for keeping the Treas¬
ury"; and the central bank as in¬
dependent agencies and tends to
promote the development of wise
policies by each,
may,
Interest Burdens
As citizens and/ taxpayers we
cah easily understand the desire
of the Treasury to minimize in¬
terest
costs
the
on
debt.
public
Treasury reports indicate that in¬
terest
from
the
on
public
approximately
debt
rose
$1,000,000,-
000 in the fiscal year 1940 to $3,-
vestments and
—of
not
The ability to carry a greatly in¬
creased debt with but a slight in¬
crease
in interest payments is a
reflection
in
of
interest
the
rates
general
since
decline
1920
and
of the expansionist
policy fostered
by the Treasury and the Federal
Reserve System; since the early
of the 1930 depression. The
computed rate of interest on the
Federal debt has declined steadily
years
since
was "
1921.
In that year the
rate
4.339% ;2i
by 11940 < it had
2.518%,22 and by the end
August, 1945 it was 1.945% 23
During this period- other long-
fallen to
of
term
rates tended to
decline, but
no
in the ultimate worth of govern¬
ings on the public debt have come
from the increased use of short-
Price declines give
speculators
an
opportunity
to
urge market-maintenance policies
small part of the interest
term paper.
r
In spite of the
.
sav¬
r
marked decline
2y2%
prices above
par
advance
may
not
of
bring
few
as
a
securities
maxi¬
and
of
thef
banking system to
assure
cessful- financing
of
by the
the
the
suc¬
war.2§r
Changes in reserves1 were adpoted, bank purchases ? of "govern-?
ments" increased26
Option ar¬
rangements Lwere sef up to facili¬
tate the sale of Treasury ^Bills' at;
Government,
observed that the illus¬
cited in immediately
preceding paragraphs did not provide for
gets
commercial
the
on
almost
nothing
banks
1916 It Pihouid5be
other hand,
from
the
in/ return
for
War
Loan Accounts:
in the
up
made
and
credit
of the
commercial;
creation
a
easy process.
war on
a
ooo.coo.ooo.
■v ?./ "v' 4 ■>/* ■ -.
.
17 The reduction could be accelerated,
course,
capital loss
banking controls can-again
be made effective.
Cf. Williams, John H.»
"Federal Budget:
Economic Consequences
of Deficit Financing," Am. Ec. Rev., Vql.
as
_
18 There
(^is extent, therefore, the Treas-
in financing the war did not
exploit its dominance of the in¬
vestment
market
This is
no
XXX, No. 5, pp.
19 Cf. Treasury
as
criticism of
248%
although the gross debt it*
self rose by 502%. JVieanwhue the
/
21
:
"
v!
Bulletin, October, 1945, p.
rate
on
the public debt and
27.The
obligations
guaranteed
rate
and
with profit# sub¬
scribed to the offerings" of the
Treasury / to , the fullest / possible
dxtent; /They also sold/Federal
was
.
•r/.-'4:'
1.943%;
the
"
Lei and/ "Short-Term Debt, the
the
Future,"/ .Sixth .Annual
and
Banks
Conference, University
Minneapolis; Feh. 13« 1945Annual. Report of the
Governors of the Federal Reserve
Bankers
Minnesota
of Minnesota,
Thirtieth
25 Cf.
securities to individuals and busi¬
Board of
: *
*'H'#. I: # -w " '
Annual Report of the
the Federal Reserve
System, 1943, p; 12..
26
Twenty-ninth
Board of Governorrof
System, 1942, p. 17. v
. .
.
27 Ibid., pp. 14, 16; Annual Report
Secretary of the Treasury, 1942, p.
of the
25. /
:;29 Cf. Federal Reserve Bulletin, Novem¬
•' * <
•
'
securities been made available for ber, 1945, p. 1114.
yi ;29Act of Congress,
Ap?il: 1943,
Sep
bank ownership, they would have Annual Report of the Secretary of the
been "purchased—by credits spe-; Treasury, 1943, p. * 79.
'
30 Paul A. Samuelson,
';The Effect of
cially created, if necessary. Wisely
Interest Rate
Increases on
the Banktog
.
.
System," American Economic Review, Vol. XXXV, No/1 (March, 19451," p. <26.
.
31 For example, note scedule of redemp¬
tion values on Series E Savings Bonds//;
:
%
ers
of
the
as
debt
the priipai'y hold-!
are
in
an
unen-1
created
/-credit,
involving
small
the bulk
actual cost to them, they can ex¬
eligibility of banks to purchase
obligations was. discussed
32 The
Federal
various
,
'Bank-.Eaiminlgs'/'ihfra/'':'//'/
'-The Turn-of
Samuelson,
33 Cf.'Paul A.
the
Screw,"-? American Eoonoraic Review^ /
XXXV; No. 4 (Sept., 1945), p. 675/.
/
36 Cf. - "In truth, the United States Treas-'
Vol.
"
•
ury
and
Federal ' Reserve
missed a great opportunity.
interest-rates
offered
stantial 'effect
and
have
had:
iorm
in
have
had
upon "private
investment in
trols
war
a
world of direct
is- held.
wealth
conr
They.'may
upon
.
.
.
the
.
II'
secret when I
say that the American authorities have iri
hope
I
am
giving
this
sphere pursued
buy, absorbing also, through ;mar-
pens,
i^et operations/and private pur-!
verse
full
away
(fortunately
an
time
relatively unimportant)
uninspired policy whose
be felt for a long
come."
to
26-27!
no
will
implications
/
37 Cf.
/ Samuelson, loc.
/•/• .■ " >
Leland,
tional' Debt
"The
Upon
cit.,
pp.
of the Na¬
and .'the Capital
Impact
Batiks
Commercial
arid
Financial
Chronicle, Vol. 162, No. 4412,. p. 753 (Aug.
16,' 1945). - Y •' .. Y
..
Market,"
/
sub^
any
consumption /
inflationary
gaps. • Y
some
minor; effects
which
war.
argued-/that;"the
has.
Lite.ralJy/ .nobody
or
System *. have
This is a 27^ /
should ' have ; been ; a ,-1 %
It
war.
increased demands for
charges" on public bor¬
rowings, and a flood of protests
in Congress against them as in¬
stitutional rentiers. Whatever happublic reactions may be adto the commercial banks;
(October,
New;York, Vol.- 27/No." 10, p. 75
1945).
t
^
' Vtyrvt. )
/.*>34Cf;/Discussldn^f;/'Bohd;:Interest hntt
pect adverse reactions from tax¬
lowered
;<
162, No. .4410, p. 634 (Aug. 9.. 1945).
i//
/ 33 Monthly Review of Credit and BusI*
n'ess Conditions, Federal Reserve Bank of
Reserve
payers,
the National
Impact of
Debt Upon Baftks apd the Capital Market)'
Commercial and Financial Chronicle, Vol.
larger in¬
higher-yield
certificates of indebtedness/ and
purchased as many 2% ten-year
bonds as they were allowed to
on
the
.
Leland,' /The
Iri
took /place has created iiifiatiori- •
ary. propensities -for the/ future,
and has made debt policy an im¬
,
Many banks invested in Treas¬
took
^vas
guarant«ttd; obligations alone
the.
on-
1.251%.
24 Cf.
•
down the interest bur-j viable position.; If they expand
dens.31# A by-product of these credits which lead to speculative
policies, of course, was the fact excesses or to pried inf lation, they
that during the war, in-spite of will become targets both for in¬
the varying maturities for differ¬ creased administrative regulation
ent types of paper, air Federal is¬
and restrictive legislation. If they
sues were practically the equiva¬
continue to be the recipients of
lent uf cash, and almost/equally
large payments of interest onrpubliquid. ""
'
lic debts based primarily on bank■
/
in
T
23 Treasury
one
non-marketable1 c bonds
Some
of tli®
Ibid.,'p.- 713.
22 Ibid.
cial banks; nor is censure directed
paid to those who prematurely ;//The/ banks
vestments
' rr''-7:.
•-
of: the Secretary
1944, pp, ^29r30, 627.
20 Annual Report
Treasury,
also kept
.
54t55 (February, l941h
Bulletin, October, 1945,
'
'
commer¬
.
redeem
A*6
t)
.at:theiTreasur$/T^
ptically,
wonder
be some reason to
may
whether central
the short-terms. To
writer has portant present problem both for
called f'a 2% war."39 The penal¬ the Treasury, the Reserve System
ties in the form of nominal inter-, and the rest of us.
:; / '
est
•
or
Interest savings . were ■ wued
annually to the reduction of principal.
if
its long-term issues as liquid and
as
free from the possibility
of
certainty: tional pressures for inflation. But
even
so, such credit: creation as
low-cost basis; an
which
operation
in excess of $250,-
retirements ol the debt
interest payments in excess of the
short-term rate, once it has made
^
-
In short, the
Reserve
System did everything
possible to facilitate the financing
an
charges
debt
trative
of ways did everything
- Differential dis-? variety
copnt rates for/ advances secured they/could to make thri/financirig
by U. S. securities-were also es-: of the war a success. ' Had more
set
XXXI, .No.
Vol
sociation,
when necessary;
were
National Tax As¬
2 (November,
the
of
Bulletin
Debt"
par/ tor the'ResbrVe^;Bahks;27 /cer-i ness firms, helped make effective
tificates ° of / indebtedness / were? payroll/deduction schemes for/the
purchased -by/the Reserve System' purchase of war bonds and in a
tablished.26
Fred R,
15 ct~.
National
Fairchild, "The
-
average34—from these
practically riskless assets.35
The
lowest possible rate,36
Banks.
Treasury so as to enable in interest rates, the relative and
to keep liquid absolute burden of debt, measured
without loss and to invest in high- by interest payments, has greatly
rate long-term obligations Which increased during World War II.
are,
through the price pegging Between 1940 and 1945 /fiscal
policies, made the practical equiv¬ years) interest payments increased
proponents
The
as an
Vz %
market for U. S. securities and to
create the reserves needed
upon the
cash.
1
a
pledged themselves to support the
the
of
-|
fully as: it
could/ have been done; nor* did? it
borrow,/ in theory at least, at the
ury bills only to resell
of them to the Federal
alent
was
on
.
band, there is "a
danger that some banks, however
few in number, enjoying the fruits
of substantial interest payments
On the other
"high-rate" returns
over
mum
from other borrowers.
cure
TreasuW
^
funds are
funds
Government must se¬
do not—added
which the
Bulletin!
/
529-30:
pp.
persuade
than
more
available for'other loans,
i
600,000,000 in fiscal 1945.19 The in¬ bahks to fecilitate transactions
terest cost to a debt of $24,000,with4 and on behalf " of the Gov-;
000,000 in 1920 was / only $20,ernment against .which accounts; the Treasury endeavored to hold
000,000 less than the interest paid
neither reserves morj deposit ill- • bank f inaricirig to. a - minimum so'
on a
$42,000,000,000 debt in 1940.20 surance had to be carried 29 This as to avoid the creation of addi¬
confidence of citizens and holders
ment issues.
loans
1
.
ury;
The expan
System, though each authority in
•liberal*> interest ■../ payments
and
ready convertibility of securities
enlarged borrowings.
p. 156.
do
If they
-
-
seem
Banks
;
their members to renew subscrip¬
tions to maturing Federal issues.
•;
-■
18.
Dat%.ior 1920 taken from Koffenberg, "Estimates
Distributed Income. Consumer Spending/ Saving
and
Capital
Output,
?
few decades
1.22.
J "4
moderate
short. of
Nor- can the Reserve
securities.
ibid., September,- 1945, p.
National
to
conflict with the Federal Reserve
■
'' /."f
2.30
r
»tiii. October, 1945, p. 2. ' "
keep interest rates Bulletin
"
;
on the public debt as low as
pos¬
Reduction
of Interest Burdens
sible—again to minimize taxes—
;i
and this "easy money policy" may
How can these costs be mini-»
augment the drift toward infla¬ mized without at the same time
it is better not to divert the nation, as well as run counter to at¬ creating other adverse tendencies;
\ tional energies and attention from tempts by the Reserve System to such as adding to the danger of
/'the important tasks of manage- check
expansion of private credits inflation or credit expansion, for
# ment.' / #/
S"
by,; facing up private interest the economy as a whole? •
- '
/./ This conclusion may be distress¬
rates.' What the Treasury doe£
The Treasury has, particularly
ing to many Americans who bewith respect to interest rates on in the
last1decade, : endeavored to
# lieve in the inherent virtue of
the public debt may have an im¬ keep down the aggregate
pay¬
/ redemption of - public debts, and
portant influence on the course ments for interest, first in order
'who proudly cite the record of
of economy in ceming years. The to minimize resistance to recur¬
the United States in reducing .its
adoption of certain policies may, rent deficits, then later to avoid
indebtedness from previous/wars.
in theory;
bripg the Treasury into tax increases jnride .ueicgssary Jby
Even
so, substantial reductions in
/the Federal debt during the next
•,
procedure may
' thfc
Reserve'
the/banking authorities
nothing,/under 1 present
laws, to force/the" b&nkS to hoW
their large investments in U, "S.
1.62
.
,
.by
serves, T
can
do
i
.
<
changes iri requiremeilts as to re¬
v-yi
1.34,,'
/-.;/
but /
Banks
i
1!46%
Formation," Review; vol Economic Stgtistlcg, Vol. XXV, No. 2 (May, 1943),
keep
taxes at a minimum may
limit the effectiveness of possible
15
p
of
be ' controlled
'
/.>##
2608.9
136,696
attractive rates
more
Or^ /if Sales are not
made, banks 'may rely upon the
discounting facilities available Rt
the Reserve Banks so as to expand
credits/ This latter
1110.7
3617.0
flation. But the current desire to
Offering
of/ interest.
t
•1260.1
201,003
j--:--■
ers
on
1.50
/Y.
1040.9
'
72,422
258,682
..VY; i.
/
678.3
; 599.3
.
.
funds to loan other borrow¬
cure
1
,
'
i/,
$1020.2
1943______^___/
147,927
1944___;__;Y__.t/ ;■ 160,700
consent
#
,
;
ernment securities in order to se¬
tlnterest on Public Debt" to National
Public Debt
Income (Per Cent)
■
:■
,
39,963
______
■}
PublicjDebt
# $24,399
16,931
$69,700
1545-—- 357,000
Various tax
/
^ r
effec¬
with; the
.
<,
position both to continue to fi¬
nance the Government and to prdvide the rest of the economy with
its 1 legitimate" credit
require¬
ments.37, On the other*hand, there
is the danger that banks, in con¬
siderable numbers, may sell gov¬
a
Relation, to National Income
Ratio of Interest
discount
controls
In the predictable future there
is: not the slightest doubt that the
commercial banking system is in
of
IV
Pebij ln
,
Discharge of Bankings Functiohs
whole
a
on
TATTLE
but under present condi¬
has been indicated; it cari
these
as
there has been little change in av¬
national
Interest,
as
make
banks
the
tive.16 The Treasury can utilize-/
not
issues
this
preceding World War
'
rates;
tions,
of
.
1.34%
income; in 1940. tp littlevchange in the average rate
2.30% in 1945. The table, likewise, of return on government issues.33
brings out how the relative ?burr Yf.Whereas short-term "govern/,
den of
interest/rises/and falls as ments"' were, for a time, the prin¬
the aggregate of national income
cipal secondary; reserves of com*
increases or -declines; These ra? mercial/banks,, it soon became
tios add testimony to the
desir* plain /;that any; government: sef
ability for | maintaining / a/' high curities, .so long as the Reserve
level of income in the future and
System was pledged to support
give force as well to the desire the market, could be thus
util/
of the.
Treasury to keep down in¬ ized.It became possible for the
terest costs on the public debt.
j. banks to secure both liquid in?
of
in¬
toward
was
ratio of the interest payments
the public debt rose from
•
;
direction
yifelds, /the -blanks sought" to offset
based
are
in the
with shorter maturities and lower
income
is, thus, much heavier than
This
moved
they are apt/to be blamed for
creating conditions either bey odd :
their control or which they have
hot proximately caused.. Iri their
own interest
they, too, should give
thought / to the way the bankowned ddbt: should be ahanaged. - \ v'' [
or
As the Treasury,
only
in the days
II. The data
-
issues.32
The relative burden of the
in national
102
experienced owners, or from the
complished over a long-extended
Treasury, but the consequences of
period and since the cost of respeculation may in extreme cases
/ demption in a short space of years
be disastrous.
»
is high—or seems so from the fig¬
This situation can be met by
ures cited—so high that taxpayers
conversions to lower-yield securi¬
■/. seem certain, on the ;,whole, to
'
ties;/ by open-market selling, " by
prefer tax reduction now to debt
new offerings to absorb specula¬
redemption in the years imme¬
tive funds, not to mention resort
diately ahead, the next alterna¬
to other techniques. But one thing
tive'which suggests itself is the
is of vital concern to the Treasury
y retirement of only a portion of the
and that is so to manage its debt
similar
THE COMMERCIAL & FINANCIAL CHRONICLE
Volume ; 163 :: Number 4456
The claims of other social institu-
by the United States, and lured on
by the possibility of lQng-con-
;
tions
y^inued interest payments may
prefer to /'clip Government >eoupons"/ so to speak,* than to con¬
also to be considered*
V^J^.
need
interest-subsidies
for
*
-
* ' '
Aims of Debt
•
-
i
.
ernment securities by commercial
-
banks, as well as to the type of
securities held. Since the marketable
securities owned by. the
banks can be used at their dis-?
the welfare of banking institu- cretion to support a substantial
tions and the way they perform credit expansion, a way must be
Bond Interest and Bank Savings expected functions. Both agencies, found to eliminate this potential
/
;•
i\. Whether:
the;-banking
.
-
dangers of inflation via
-
tion is
not to
.
creation
in case of need, or subject to dismonetary count at, the. Reserve Banks, but
otherwise hot'; freely "marketable;
expansion.
The,
whether they can afford
reduce, the cost of credit
Curbing Inflation
The tools at the'disposal of the
treasury.
: This
credit-creating power; lodged Treasury for curbing inflation are
under
the1 trusteeship
tax
policies; expenditure reducof
the
;
banks, is fundamentally a Gov¬ tions and debt management. Taxes
ernment function to be exercised now seem to be " in process of
the
to
public
for the common:good., When the
banks
created"
by
the
govern¬
ment, the cost of such borrowing
is a matter of national concern.
The interests of ' the; banks bend
to the interests, 61 the
which they are a part,
of
group
{'(As^of/Aug. 31,: 1945/commerciat,banks held slightly over. 30%
iof .the; outstanding interest-bear//ing debt.3® .Thirty pec cent of the
..
^interesbypaid
_
^o,$|,085,000,000.40
The exact in- banks and carry on open market
yd;tei^stipai(h to various holders of operations in Federal securities.
^Jthe debtd^ not available and this1 It can abandon the support of the
^estifriate (exaggerates the amount
of
such
banks.41
payments
whickhet itf°haSgSvely JESS
tataed during tlte war^This latter
trheer™rkltP°rateys Tn'-govem-
to commercial
On the basis of data on
bank earnings for the first half of
the year" 1945, bank earnings from
...
all securities would be about $1
ments" to find their own level and
627,000,000/it "converted
if
to
•
parable
fiscal
calendar
j^ear 1944, when
terest
year
paiyments
on
$3,001,806,000, ^3
basis.42
In
.
total in¬
the debt
the banks
bank earnings and might
lower the computed interest rate
reduce
paid approximately $884,540,000
for the credits created primarily
paid
to finance the war.44
This was
29.5% of total interest payments
made by the Treasury.
It was,
earnings.
of
and
a
iwere more
on
from renewals as short-terms re-
inoli
re¬
.
a
charge of about $884,540,000. Total
they
wanted
to
increase
|
|
UG
a
posed for the purpose, of retiring
debt
"\yould' be v salutary—the
$1,127,000.00(1—85 %(covered by in-:
heavier. the personal taxationftif
terest payment? on. U.; S»
secdri-J
ties! This seems,like alhigh, price, properly spread, the greater its
to pay,! for. the i manufacture of anti-inflationary: f6rcev: But:if th6
credit' for use; of the Government proceeds werq immediately paid
over to holders of the debt; the
under : powers.; granted ( by that
funds
placed at 'their disposal
same^ [ Gqvernmenti ?, The • price
might
easily^ ;feed: speculative
seems! too ^gleat/: iri{ the
; bargain, ■booms or add to the. volume of the
for ( making ::' relatively : riskless
then current spending, or by inloans. But it: must be, added that
vestment-orfspendinglcancel the;
it? is^6hly(fair 'that (the
Govern¬ effect of; the. taxes (imposed'for(
mentshould: pay, ,'a:. part of - the
;debt redemption: All of (which
cost of operating
the currency,
argues for -the imposition, of taxes
check clearing; a nd' credit mech¬
for debt repayment during booms
anisms i of if; thel: banking f system.
but- with actual repayments deTheseservices; are: vital i to! the ferred until
depressions occur, at
Government as well as to citizens
which time the increased payand' their;" enterprises. What the
ments would be most, beneficial
,
•
to the economy.
If, however, debt
public! policy: question;. but it payment should be attempted durshould be decided as a: distinct
ing inflationary periods/1 or peissue and hot. wrapped. up as a
riods,^tending thereto, non-bank
subsidy disguised under the pay¬ holders ;will receive ; tash (for
ment of ' interest on the public
spending or reinvestment, while
a
-
debt—unless it is decided that this
is the. best;way. tp
accomplish that
purpose and unless it is. generally
realized that; this is being done.
feg
debt
of the
°riteria
banks will be able further to
ex-
pand their credits/The saving leature of. the repayments may well
hp tho V7nf iCt VC LTl:
^
as
a
credit control
mechanism.
smaller
interests
less
and
any
understanding force the issue or
present unsatisfactory remedies.
course
duce
of
because
here suggested requires
which seeks to re¬
rates, not merely
possible effects on
program
interest
but
rates to commercial borrowers
cour¬
of the probable re¬
because
also
age.
duction; of
Two Proposals
long-run
earnings.
object to a new re¬
requirement and to the loss
of investment flexibility.
But in
the nature of the case the ad¬
Others
may
serve
-
vantages and objections must be
weighed with the decision rest-
the ultimate advantage to
as a whole, rather
than to the government, alone.;
)
ing
on
the
economy
Direct Borrowing from
Federal
Reserve
.
^
,
is to per¬
mit the Treasury to borrow di¬
rectly (from: the Reserve Banks
Special Securities for Banks
whatever funds are required to
If- commercial banks are to be finance the- government.
In the*
so.
second suggestion
A
given a special security in ex¬ coming
years,
therefore, / the!
change for a substantial portion Treasury would borrow from the;
of the United States obligations Reserve System enough to pay offi
they now hold, ;tfre; new issues its obligations to the commercial
should be non-marketable but re¬ banks. Then to prevent the pay¬
deemable by the banks ; in : case ments so made, or the excess re¬
of deposit loss. .They might sim¬ serves
so
provided, from- being
issues mature.^ Thia ilarly
be eligible for discount at exhausted in credit expansion/ the
| the Reserve B^nks. at rates estab- Federal Reserve Board would be
^ obliga- Hshecl,"ffom /time; to /time; by the expected to raise the reserve re! Reserve System^ These securities
| quirements of member banks and
f Treasury more should bear! no
maturity apply a like requirement to nonSubject tof the vagaries date but could definite
be paid at the members.50
On the reserves < sc
e*
pleasure of the government. The required; interest would be paid
i J +S
'■
rate
of
interest,
paid would be
shoul<3
corn38 Ibid., p; 754.
d
low but would have a close re¬
39 See Table III, supra.
of wise
f
mana2ine the
ihe
}origi4rm^
^oft-tor^lVratetSlie"/as
successive
.
a^d more
«
^
»
juorcial banks be reluctant to reJJew their subscriptions, an em-
harrassed Treasury would have to
£/
to individual or. institutional
borrowers or directly to the Reserve Banks for financing. The
H
^
long-term debt with
UC
„
lation
to
credit,
or
the cost of providing
checking facilities, and
holdings would have
to
of deposits or the increase in de¬
posit?
.
it
adds
„
to
,Un
inflationary
•
•
■
•
minimizing or
pressure
to-
during;
a .selected
period.
For. purposes of credit control this
percentage could be varied from
time to time.
The interest rate
paid could also be made to vary
as
economic conditions changed
and
as
it
became
desirable
to
cause hanks to hold more,, or- less
than the. minimum
reserve > in
these securities.
What this plan
ward inflation; they should be in amounts to is not a freezing, of
such, form as^to facilitate, the man- :"governments" in the banks but
rather the establishment of a min^
agement: of the debt by fthe Treasimiihi
reserve
in
government
ury and should; carry, ah interest
rate, commensurate with the risks bonds applicable to; all, banks. It
and ^ costs involved. .The?^ terms should; aply, therefore; to all com¬
mercial banks rather than merely
should ; be ;,6f.; a kind " that; would
-
-
-
result from free bargaining where
both parties knew all of the problems, costs, and iissues involved,
The arrangements > should (not be
in the nature of forced loans even
though the banks know they Will
have-to (finance the government
for v years, s and- the government
knoWs it has iiltimate control over
the
^banking
laws
and
>
could
coerce the banks into doing its
will. (Nor should the problem of
providing special securities be
solved by means of
to member banks in
An
would
Rather what is desired is such
member
securities
on
92,16%. thereof .was $884,539,699.
Reserve Bulletin, May,
1945,
787,000;
Cf.
Federal
491. ;...t
:>"• //
; 45 Banking
and
Monetary
Statistics,
Board of Governors, Federal Reserve Sy$P.
temV '1943, p.' 264/ Federal Reserve
1945,
May,
to
the
member
requirements would tend
regulate the aggregate volume
credit.
By. not being, required
carry all government securities
the special issues, just detailed,
reserve
the banks would retain
some
flex¬
ibility in buying and selling their
marketable/ "governments,"
-
but
the percentage of securities which
could be traded in on the open
would
be-
relatively
governments ' so tree the l market would " be a relatively
at the deflationary banks from central credit controls / small part of the total investa
i....
J...
Bulletin,
1945,
498; Ibid.,'November;
annual
remained at
rate of; return, oii.
1.5 per cent during
first half of 1945.
46 For
•
•
t
example,
,
ori
Sept, 1,
1945 the
.
Treasury refunded 2%%/Treasury Bonds
of Sept. 15, 1945-47 with a % % certificate
indebtedness,
Cf. Treasury Bulletin;
1945, p. A-10.
.
, •
.
the v"Easterday
Plan'!: irivolvingi
the use of excess profits, taxes./-The .fol¬
,
October
47 Cf;
P. R. Easterday,
The/ first-. National
indicate the
of this idea;. "A Layman Looks
lowing/pamphlets
.
by
Board,
Nebraska,
Billion. Debt and „ Seeks Help
Economists"' (August, .1944) J1
We Do With Our 300 Billion.
(September, 1944); "A 300 Billion
At, A
300
from-
Our
"What
of
Lincoln,
of
Debt?"
banks
market
p.
The
p.
1106.:
securities
individual
of
$60,324,000,000, or 92.16 fy
from
interest and
securities.amounted to. $959,-
;! Earnings
dividends
evolution
acquire - cash: when needed;
f
'
were
total.
of
Both
changed
conditions required. The dis¬
counting operations would enable
banks.
as
in
to
$547,000,000 hv the first half of ,1945. ; If
half of the former is added to the latter,
to convert to a fiscal year estimate/ the
total Is $1,027,000,000.; Cf. Federal Reserve;
Bulletin*: November*. 1945; pV 1106/
■ ; 'i
43 Daily Treasury; Statements..
;/ I
44 This figure was obtained by appoNtioning to interest ort U. S. securities 92.16;
per-cent of the interest and dividends on,
securities received rby member banks. Total
securities held were $65,455,000,000; U., S.1
Bank
by the
could be
(October; 1945).
earnings from securities-,
$960,000,000 in, 1944 and to
42 Member bank
amounted
of
arrangement of this type
tend: td / re-establish the
the
to
the return to
as
Chairman
to
complete 'understanding of/'the
fact that 'present-bank holdings
of - "governments"
so
free
the
cost
41 The
same
credit; controls
to
accom-
November,
discount rates and reserve ratios
fixed by the Reserve Banks, as
special taxes 47
plished the desired objectives,
the Federal
Reserve. System.
or other
arrangements 'under
which the banks would be driven
to elect the acceptance of seme
conversion scheme which
1945, .p. . 2.
27, No. "10, p. 75
such
vate banks rather than with the
t
fiscal
of
in government financing with pri-
dangers rather than
public debt for
$3,617,000,000. Treasury Bulletin,
was
ketable securities the banks would
be required to hold* The amount
ligations.
This rate would ap¬
ply only to the special non-mar¬
Treasury.
Under present cireum-
40 Total,interest on
1945
; :
Treasury is not the,
th£ Banks. Many of
the bank
investments were purchased on
the market, at a premium.
Cf. Monthly
Review of Credit and Business Conditions^
Federal Reserve Bank of New York, Vol;
the riskless nature of Federal ob¬
be fixed by some formula having
a definite relation to the volume
;skive the problem The negative the .credit
^ ^sues ^Oiv^ xne
deflationary- effect of taxes im*
bank expenses in that
year; were
Federal contribution should be is
advantageous to do
one
mana{?p
die* would only have to re-. 'POstponwtom,^, ' ■renew subscriptions to maIn the years ahead it is probable
turing issues. The Treasury would that the banks will be the primary
have to pay them and secure new holders of the public debt.
Confunds elsewhere.
sequently,
the
securities
held
iSnvmfrnt 6f outstandshould^^ be of such a type as to
States& ?_
(t Government $60,324,000,000 for,
bt
fuse to
,1929, and. only 1.5%
ifi 1944.48 /Such a return few; peo¬
ple could' call. excessive. In 1944,
capital ot
of $6,712r
$6,712,000,000. 16ah'ed the United..
d
cash
8ge return, ori bank investments
a
mntur-
the independence or oanKS.
When
„Was 4.7 % in
with
lrmupr
crease
turns from...this; source,. and this
In spite; pf the fact that the aver-
banks
outstanding issues, if the
volume of short-terms
Rw
ities. SlS^woSw^aSf
This Pohcy would also in
securities
than.double 1929
This is
-
larger
with
matting series whenever it
feels it
.
single
'part of bank earnings than ever
before. As a matter of fact, in¬
terest and dividends
be
thereby increased; but this
would not help the Treasury in
meeting *its maturity problems;
U1U5U1J?
ill
nor: reduce the inflation potential, short-term?
may be illusory
in
T+Vi ^,hippf the spite i of the interest reduction
T»^°nw
increased
dangers achieved. It places the advantage
for- the year; yet it constituted by
source
on
relative
was
however, 47.7 %. of bank earnings
[far the .most. important
to
The
securities with shorter
maturities. This would tend to
were
have
patriotism, self-sacrifice and
terms' to
were
would
eral securities
The
plan just described re¬
sembles, in certain respects, the
Treasury Deposit Receipt borrow¬
ing inaugurated in England in
July, 194049
The proposal is,
investments in government obli¬ thus,
not
completely
without
gations for. as long into the future precedent. It seems to have been
as we can foresee and that there
operating satisfactorily, both for
is a strong probability that the the
Exchequer and for the banks.
holdings will increase both abso¬
Objections to American adapta¬
lutely and relatively in the fu¬ tions of the
plan will, however, be
ture.
Therefore,; as interested numerous. Any departure from
parties, the banks and the gov¬
purely
voluntary
arrangements
ernment should endeavor to work
may be opposed, unless the vari¬
out
an/ equitable solution—and
ous
parties can come to some
any
solution will doubtless re¬
agreement as to what should be
quire legislation—before parties
done.
Some banks will oppose
and this process of exchanging
securities, at maturity would, bp
all
"governments" were?not
equally Uquid, the banks might
turn from a preference for long-
a com-
banks
llot
as
banks will suffer from the after¬
willing voluntarily to accept them
for
the public debt
portfolio—so small, in fact,
to endanger the general
stability of prices.
This plan,
moreover,
would
re-establish
open market operations in Fed¬
ment
essen¬
math along with everybody else;
that the banks, if they are to re¬
new offerings given m exchange
tion.
The Federal Reserve Board can I
(during-the;fiscaly^ar 1945 tended change discount rates,-raise bank
A|pn5dudeiy30|;1945) Xw6uld( amount reserve5 requirements; of member
on
controls is
^
maining tool for, countering' infla-
nr
of
would be no uniformity m .the
There are two solutions which
treatment of banks. How each seem to me to be most
profitable
bank would be affected^ would d£- for consideration: (1) legislation
own investment
providing a special non-marketportfolio. This suggestion does able security for bank owner*
not. -seem. to meet the current ship;48 (?) the
payment of out¬
• problem .( either from the staridstanding
bank-held
obligations
poinv of the banks or the Treas( with Federal Reserve
credits, and
uiy. Nevertheless, irrespective of the
readjustment of reserve re¬
jy^at else may be done to solve quirements for all banks with the
j£e central problem involved m payment of interest on reserve
^
of govern- balances. Let us
briefly examine
ijents, the Treasury will change each proposal.
,/v
the form and terms of issue of
possible even for cyclical gains.
Perhaps debt management • mav
become; the most / important: re-
'
restitution
spread over many years. There
rapid reduction and whether they
could
be. quickly
increased to
meet inflationary dangers may be
doubted. Expenditure reduction is
liquidating, the wartime machine
and that will help; but once expenditure levels are stabilized,
little additional reduction will be
people, through their government,
borrow; from; themselvesj through
.
danger. As various issues mature,
the Treasury can, of course, offer
the banks new issues redeemable
therefore, are (vitally concerned
with'preventing the bank ownership of governments from adding
fuel
to
the
lurking. potential
system
\ will voluntarily; aid the Treasury
in reducing .the carrying charges
on the public debt is difficult to
predict.; From the point of view
of the banks themselves the ques-
-
tial; that if inflation develops the
.
the need for private capital, ernment. The Federal' Reserve
upon the zeal developed for; prof¬ System is also interested in the atits, as* well as upon psychological tainment' of these; objectives. ' It
reactions of bankers, in the years will have a weather eye, too, on
;;
delayed debt repayments. A gain
that in the interest of the nation
the . payments, however, /were
made with borrowed money, the main comparatively free institu¬
current result would inflationary, tions, cannot afford to accept as
So it appears that both the much interest on public loans as
Treasury and the Federal Reserve they have been receiving, nor per¬
Board must give, increasing atten- mit the payments to increase; that
tion, to the accumulation of gov- they will continue to have large
upon
;
a
a
reduction of taxes for interest. If
,
i
effects of the necessary taxes may
be completely offset by the
in the future would come from
.
Management/,;
tinue >to assume the customary
••.. In the management of the debt,
Commercial risks.38
This danger the Treasury is dominated by two
is increased both as banks are able motives: (1) to prevent inflation
to invest ;in the higher-rate: long- or deflation—in other words, the
term "governments" and as liq- stabilization of the economy;, and
uidityiis -assured byi a guaranteed (2) minimizing the carrying cost
/ market for these investments.; The of the debt consistent with assur'. reality of this
danger depend? ing the credit standing of the gov-
v
not
Shall
(December/ 1944).•
/
suggestion, under which the
constitute an addi¬
tional bank, reserve, was. made by Seltzer,
Lawrence H., "The Problem of Our Exces¬
sive Banking Reserves," Journal of Ameri¬
can
Statistical Association, March, 1940/
pp. 24-36..
Cf. also Seltzer, "Discussion"
in Implemental Aspects of Public Finance,
American Economic Review, Vol. XXXIV,
No.
2, Part 2 Supplement, p. 136 (June,
Problem,".
48 Such
a.
special securities would
1944)/.,;..-,;//
49 Cf.
Banker,
50
to
'.'Modern
April,
Credit Technique,"
1942,
pp.
The
11-20.
Any. plan to be adopted should apply
all commercial banks.
*
:
(Continued on page 284)
/:
nwrr t P;
COMMERCIAL & FINANCIAL CHRONICLE
THE
284
Thursday, January 17. 1945
"":"lftt'L
page)
(Continued from
:v
:
action by the
; : In
the? last
American Congress.
anhlysis, it is the
Congress of the United States who
M
(Continued from page
.
.;
>?.
.
I
„
w
,
-:
pated. In factj it should be borne
in mind that many countries are
looking to us expectantly for fi¬
help defray the expenses of the to avoid it we must develop an will' determine whether this loan nancial aid. As concrete evidence
Both'*' thfc
th§' re¬
•**<>- onnHaHl<l»
riri»VAritiVA nrncrnm
equitable preventive
program. Wa
We will be made. The Congress; has of this, $ cite statements recently
Ranking system.
Both*
serve requirements and the inter¬ can develop such a program only the duty and must accept the full made by Rene Pleven, * Finance
ft*
r^spomibility Jfor ratification or Minister/of France,: and Christian
est' .paid
on- /reserve • balances by working'at- it.
rejection. This duty that now de¬ Pineau, Spokesman of the Con¬
Could be made variable at the disr
51 Title 12, "U. S. Code Anno., 356. Amende
Cretion
of the Reserve- Banks, meat of Dec. 28, 1945 extended to June volves on the Congress; is' pro¬ stituent Assembly's Finance Com¬
found father than perfunctory in mittee. M. Pleven, after- pointing
30,
1946 the power of Federal Reserve
^dth Treasury approval, to secure Banks
to purchase up to 65,000,080,000 in
character. Possibly out of. defer¬ out that France had gold reserves
the
appropriate credit policies
"governments"! directly from Treasury, v
ence
to the President
and the and public
and- private - assets
heeded- by the economy.
These
52 On
sixteen
.occasions
in
1942 ■■ and
Requirements, plus the expenses thirty-nine times in 1943, the- Treasury Exceptive Departments of..? the abroad in the' amount o£ 118 bil¬
borrowed
varying- -amounts
as' high- as Government,: members
of Con¬ lions of dollars, then stated: "It is
of, the Reserve System, would, or
$1,300,000,000; direct from4 the Federal Re¬
could; determine what the: Treas¬ serve System on one-day- certificates, gress-should,: to some degree, in¬ absolutely necessary to add large*
dulge the assumption that the loan externaXcredits, especially dollarsi
ury paid theVReserve. System for "principally to avoid temporary "decline hi
member- bank reserves -around income -tax
should be approved;, but the Con¬ to these gold reserves and public
its direct'loans.'7?.;7,
dates.",- Due: to more .adequate,: Treasury
gress"
is.hot. required, nor should and private assets abroad." < M,
The effect of, such payments cash, balances no such direct
borrowing
it feel.obligated, to agree and con¬ Pineau stated it more bluntly by
would be to "make interest on gov-; took place during 1944 ,or: 1945. Twentyr
fernment obligations more a mat¬ Ninth Annnul Report- ;pf• Board of sent until; and, .unless, after care¬ saying: "The whole problem (for
Governors of; the Federal Reserve 8ystem,
ful examination arid study of its France) is to obtain, apart and In
ter of bankihg—or credit Creation
1942,
p.
16;
Thirtieth' -Annual- Report,
Woods,
a
—costs 'than of market. competi-, 1943, pp. 16, 67, Annual. Report of Secre¬ purposes and the terms of the addition ■ to - Bretton
of those nations who were;;
principal allies in the recent
many
our
warj
ances
'Without*, substantial, assurf
that such loans :will;be re f?.':
to,
considering these important
In
members of Cpngress.io; remem¬
ber that
.
.
.
-
-
•
with
tion
monopoly
:
elements
;
To complete the socialization of interest on the public
tary
the
of
the reehact-
would require
debt
trient of
franchise tax
a
Fed¬
on
earnings, or the.
adoption of a provision permitting
the transfer of surplus earnings to
the Treasury, r Whatever advan¬
tage ; these ^ arrangements
poseral
Reserves
sessed would eventually accrue to
•the 'people whose collective credit
was being utilized.
If, at times, it
proved to be more costly than the
present
contractual system,
at
;
incidence
the
least
could be defended
:
of the
cost
being fair.
This plan, while it sounds radi¬
cal, is really only an extension of
^the' present system under which
the Treasury. has sold Treasury
bills to the banks which, in turn,
as
-
have sold them to the Federal Re¬
Banks. The Treasury might
have borrowed directly
serve
7
.
' well
as
;
from * the Reserve- System in the
first pace; Open market opera¬
tions
under
which the? central
bank
purchases government
secur¬
ities—certificates of indebtedness,
motes or bonds—operate similarly.
At present the Treasury caii,bor¬
row as much as
$5,000,000,000 di¬
ever
desirable,
holdings.
of
non-bank
Federal
but has borrowed only relatively
sums for short terms on a
few occasions under this law.52
or
plan
it
owned U.
S.
securities
to
the,
System and might be a
final step in the monetizatlon of the debt.
This
Reserve
plan has
described
of
the
*so
no connection
above,
y
Moreover,
monetizatlon
large
topic
a
reserved
for
.
of
its
that
another
the
wich the plan
a
discussion
public debt is
consideration
occasion.
is
Interested
readers should see Simons, Henry C.,
"On
Debt
Policy," Journal of Political
nomics, Vol. LII, No. 4, pp. 356-61
Eco¬
cember,
1944).
-
;
(De¬
i
t.
Virgin Islands
to
Have Negro Governor
The first Negro Governor of the
Virgin ; Islands,
Judge /, William
Henry Hastie, Dean of the How¬
ard University Law School; was
nominated for the post by Presi¬
on Jan. 5, according
dent Truman
to
Washington advices to the New
York ^Times/-?;I£Jthe nomination
is confirmed by the Senate there
is some speculation as to what is
to
of the present Gov¬
Charles Harwood, appointed
by President Roosevelt* yyhp i^not
become
ernor,
known: to 'have resigned-
Judge Hastie
was
*
r'";'
t
at one time
adviser to former War Secretary
Stimson, but he resigned the .post
in. - January,
1943, the "Times"
ready, served the United States in
the Virgin Islands, where the pop¬
In
actual
operation,
eventually
this
plan
transfer
most
of the public debt from commer¬
cial banks to the Reserve Bank,
ulation
is preponderantly Negro,
capacity of Federal District
in the
Judge; from 19377 to: 1939, From
1930 to
as purchases were effected.;
1937, according to the
This
plan will be opposed by many as "Times," he was a member of the
being merely a monetization of. faculty of the Howard University
fhe entire public debt; by others
School
device for taking all brakes
sistant
as a
off
of
public
borrowing because
of the elimination of market eval¬
uation of credits; by still others
for avoiding debt pay¬
ment at the expense of the mone¬
of
Law, and
was
As¬
an
that
the
rather
Some
plan
will -be
leads
sure
Solicitor
of
the
United
States Department of the Interior
frqrn?1933? to 1937?wheA he went
as
Judge to the Virgin Islands.
.
inflation
to
being
safeguard
a
against it; The plan might prove
beneficial
in -operation,, or
it
might be
so .can
a
calamitous failure.
But
any program of debt. man¬
agement in the years ahead,
\
various
"sterlization"
remove
the
schemes
to
dangers-inherent in
bank-held government paper need
given serious consideration,
Just. how. to treat bank ownership
of
government securities is at the
the
moment,
debt
lem
central
management.
needs
'fashion
to
flation.
prob¬
of
further announced a? follows:.
industry's November
roll; totaled,
pared
to
the
$121,258,100;
October
and
.
the
average
;
was
em¬
532,600,
521,700- nnd.t the? November
1944
average :of 564,200 persons.
/?
The
November, against 119.6
be
contributing
to
the
credit-
added
the
toward
war
costs
postwar
average
ployees
cents' in
October
and
120.2 cents
in November 1944.
Wage
age
of
earners
41.9
worked
hours
per
an
aver¬
week
November, against 41.7 hours
math
and
week
losses
we
liquidation.
need not pay J But
correct
per
answers
in
the
to
following
four questions:
of
the
loan?
Does
Government
our
and
economic
obligations
condition
it I has
curred and others
to
be
assume—that
made
in
per
October, and 47.7 hours
week in November 1944.
and
already
the
in¬
tbat it%ili hSve
can%is
is,
loan
imperiling or
without
"that : the
United
(to France) should
pattern of the one with
the British."
These expressions
are
typical of the desires and
hopes entertained (by many for¬
r\
like^mariririr)ifrom:fd-.
derived in
of
the
state
of
mind
of
foreign governments and of the
many appeals and large demands
that
will
be
Government
made
for
on
our
post-war
own
assis¬
tance in the immediate future for
loans
and grants-in-aid of world
reconstruction and re¬
economic
habilitation.
gress
and
can
„
should
If
the
sume
additional
the
burden
that
such
tremendous
a
,
determine
its
from the
loaning of
money,
could
duty, decision, and action.
In
we afford to strengthen the bonds
its# inquiry and examination into
of
friendship existing
between
the pertinent facts and existing
America and Britain by making a
conditions, it should be deliberate
loan to her, then later, refuse to
and cautious. There is no special
make a comparable loan to Russia,
emergency; or distress attending
this transaction that necessitates France, China, Poland, and others,
and thereby incur their displeas¬
or suggests justification for hasty
ure and impair instead of strength¬
action.
_,
.
en the bonds of friendship we have
As above stated, this is the first
have with those countries;
...
,
of a number of requests and ap¬
I, therefore, contend that the
plications of this character that
British loan cannot advisedly be
our Government will have to con¬
considered
entirely apart from
sider; Other countries, members
and independently of similar de¬
of the United Nations, who were
mands
that
will
be made on us by
also our allies during}: the war,
other governments. We must give
have already unofficially and in¬
consideration to them
now,
formally indicated they would ap¬
ply to our Government for loans although the have not yet been
It is also
in large amounts. Therefore, we submitted officially.
should recognize that in granting most appropriate, if riot compel¬
a.
loan to Britain, we are pos¬ ling, that we "Stop, Look, and
sibly
establishing; a precedent Listen" before we go too far.
Upon inquiry* I find that ac¬
that may by implication obligate
us to accord comparable favor and
cording to the best and most ac¬
treatment to other Allied Nations, curate information available, our
whose distress and need for finan¬
cial assistance are equal to or
greater than that of the British.
'The fact that we do not have at
other
negotiated
loans
with
foreign
countries
pending before the Congress for
approval does not and should not
preclude us from taking into ac¬
any
count such
j loans
and public expres¬
high :v ranking ; British
officials.
If they resent the terms
and conditions of the loan now1 ?
attitude
ical
sions % by
dollars,
some
debt
as
of
262
billions
of; Sept. 21,
of
1945, is
70 billions of dollars in ex¬
cess of the aggregate National indebtedries of all of the other gov¬
ernment
members of the United
Nations
Organization
This prompts me to
become
'the
chief
combined.
ask, "Can we
as strongly as their protests and
Criticisms
indicate*; how mrich
favorable and tolerant can
the
attitude
their
expect
when
to be
begins to mature
loan
payment is at
hand?
We are made to wonder if
while accepting the loan with Its
attending obligations they ''have
the
and
of
day
their fingers
crossed".
IvThe: foregoing ^considerations
prompt me to defer a final de¬
cision on the merits of this pro¬
I need and
posed loan to Britain.
shall
that will
information
seek
enlighten me sufficiently to give,
if possible, the true answers to
the foregoing basic questions and
issues presented by
Parcels to
this proposal.
Philippines
Rbstniasteri Albert Goldman ari^"
nounced on Dec. 31 that the postal
Common¬
the
of
administration
wealth of the Philippines have re¬
quested that due to lack oLtrans-;
portation and storage facilities the
restoration of the regular limits of
weight and size and the frequency |
ot mailing of parcels»from the
United States to the Philippine Is¬
postponed to a later date.
lands be
The advices added:,
^Therefore, ! the
.
.
.
,
'
in-7
previous
insofar as they
structions issued,
pertain to the limits of weight and
the size of fourth-class matter
ad¬
dressed to the Philippine Islands
are rescinded.
Hereafter no par¬
cel
exceeding 11 pounds in weight
than 18 inches in length
or
more
or
42
inches
girth
in length and
for
mailing when addressed ?to the:;
Philippine Islands. Not more than
one parcel per week may be sent ?
by the same sender to the same
shall
combined
be
accepted
,
■addressee,;
regis-,
dis¬
patched to Manila and all provincial capitals iti the Philippine Is-;
;
"Registered
and
letters
■
tered packages may now be
lands.
Previously
'
service
was
of; Leyte,
Luzon." f
It
was
and,
Mindoro,
?•
.
Parcels to Albania,
?
?
limited to the islands
Samar,
,
;
registry
the
f
.
!
Hungary
announced on Jan. 8 that
ordinary (unregistered and uniri-; p
sured) parcel post service to Al¬
bania
and
Hungary
was
resumed ?'
subject to the same conditions as
were in effect prior to the suspen¬
sion of the service. The parcels
will be subject also to the follow¬
ing further restrictions:
;
1. Only one parcel per week
may be sent by or on behalf of the
same, person or concern to or for
the
,
same
2. The
addressee.
weight of each parcel 13
limited to 11 pounds.
?
3. Contents are limited "to nori-.
sustainer of perishable items which arer not '
Europe?'" "Or can we afford, in prohibited in the parcel post mails :
reasonably be antici- view of the present obligations to Albania.
applications for other
as can
National
\
A
appropriate,'comment
might be made regarding the crit¬
.Much
we?
M.
policy; and
program ultimately will entail.
answers to all of the above ques¬
It
is
argued
that
by
making
such
tions are negative, then, of course,
loans
we
are
pursuing* a good
the loan, should not be made;
If
the answer to any one of the neighbor policy that will result in
above questions is negative, it is building good will and in strength¬
very doubtful that the Congress ening the bonds of friendship ex¬
should give its consent to the loan isting between our country and
those for whom we provide such
agreement. »
'
r
assistance. Granting, without con¬
On this basis, I think the Con¬
ceding, such results always ensue
approval.
to follow.,
dicative
of
In contemplation of these strong
appeals from other countries for
loans totaling many billions of
dollars, it occurs to me that the
the loan serve the best interests better part of wisdom suggests
of both governments with recipro¬ that the Congress defer action for
cal or mutual benefits, material a reasonable length of time on the
British loan and await develop¬
or otherwise, of comparable value
ments with respect to other appli¬
:: .(4). Can
and will the British cations in the hope that before we
Government be able to meet the enter upon this gigantic venture
obligations it assumes, and will of substantially financing world
the loan be repaid?
rehabilitation or becoming- "the
^
If affirmative answers to the chief sustainer of Europe," that
we view the over-all picture and
foregoing questions can be sup¬
reckon with the possibilities of
ported by the facts and established
our
own
financial ability to as¬
conditions pertinent to the issue,
Congressional
eration b ut of the next; and others
more
governments.
United States is
materially impairing our own economic security?...
.1 *
<
*
(3) Under the terms of the
agreement, will the making of
then the loan should be made with
turq
And the ex¬
Pineau, that the
"going to be the
chief
sustainer
of
Europe," l is
most significant in that it is in¬
eign
pression
(1) Does there exist- a. re^l ne¬
cessity or urgency for the making
present
i
inevitable after¬
of
of
average
cents in
a
Congress should weigh
carefully in making its; decision.
These factors may be identified
and emphasized in terms of the
States credits
some
V
of
inflation with its
.
of
trending toward in¬
to
This price
;
November
number
ployees in November
against the October
com¬
total
1944. total of $143,136,800.;
The
pay¬
$122,796,800,
,
work pr
in
adding fuel
Otherwise
have
higher in November than in Oc¬
tober, according to the American
Iron£ and Steel Institute which
to
avoid
solved
creating costs of financing the
will
pay-
earnings of em¬
receiving hourly, piece¬
tonnage wages was 122.0
to; be
other forces
problem of
The
•
Average employment, total
rolls and average hours of work
in the iron and steel
industry were
The
Nevertheless this plan and the
to be /
Steel Industry Employment
Increased Sharply in Nov.
C
than
follow the
the
-
as a means
tary system.
that
ability
to provide this assistance; taking
into account its present financial
funds.53
,
further"' said
(2)
stated, basing his action on "re¬
actionary policies and discrimina¬
tory practices" -Of the?Army; Air
Forces against Negroes; He has al¬
would
:; In >my; Opinion, there are
at
least four major important factors
possess♦ the* resources and
proposal
under
discussion
simply extend these bor¬
rowings and make them the cus¬
tomary method of acquiring
The
would
/
Ibid.,
57;
p.
prove neMBSarv
could be so modified
applicable to non-bank
This might involve the transfer
this
make
to
as
rectly from the Reserve Banks51
small
1943,
Treasury,
present.
pluses in the Uriited Sta;tes Treas-t
ury. • They must be i rnade, frorq
borrowed .money out. of proceeds
now. on band derived from Vic-f
tory pond Bales, or, ffdmnproceeds
Bpnij 'sales?to:j;he? American, ;
people. lri:fact,* if ?such foreign
post-war loans Sas:we may:make |?
should not be repaid,' the action
of the Congress in .approving thel g
loans will be tantampunt to spend¬
ing ,a percentage of the wages, 1
agreement entered into, it is con¬ credit agreement with the United earnings and profits to be exacted v
vinced of; both >the justification States, .which is. going to be the by future taxation from the Amerand wisdom of giving its consent. chief sustainer of Europe."
He lean people, not only of this gen¬
'
.
*?; f. in-
ar^ inbt making Jhese
capital reserves or sur¬
we.
loans from
„
-
it-is ^well ior
facts and questions,
-
■
:
.
'fI'iik
*
our 7,
own:.Government; to -make large"
loans on i a broad scale ta all or?
_
???■'
-
of
conditions
financial
and
The Government, the
•;VoIume--163-^NumberF. COMMERCIAL & FTNANCIA1. GHRONICLR
(Special
to
28S
The, Financial
Chronicle)
and William E. Holloway have be¬
.
OMAHA, NEB.—Victor E. Cafbecome
associated
Douglas,
with. Grouse
f j.
Chronicle)
(Special to Tee Financial
y'>
•/
.
••
(Special to"-the- Financial; Chronicle)
BohmeirBuilding,
serving in the armed forces.
rejoined
after
CINCINNATI, OHIO—Daniel S.
has become connected
with Field, Richards & Co., Union
Building. He. has recently
DETROIT,
;
? 1:
Harmon
11
with Investment
&
after
ing,
serving
armed
in the
Chronicle)
(Special 'to' The Financial
become
with Commercial &
KANSAS
William
connected
Waddell' &
Co.,
G.
Shultz
Herrick,
Baltimore
1012
(Special to The Financial
,/;; "(Special- to,
The Financial
KANSAS
D.
Penobscot Building.
with
MICH.—Wagar
A.
KANSAS
pany,
Chronicle)
to
the
&
Co., Penob¬
staff
of
Building.
Lyons
is
affiliated
Chronicle)
CITY,
Chronicle)t
RAPIDS, MICH.—Ar¬
Company,
Grand
Rapids
National 'Bank Building. He was
previously in the U. S. Army.
CbJ/Ltoibh; Commerce Buildtog;
serving
to
the
in
armed
Hor¬
forces he was with Ledogar
ner
& Co.
•
with
(Special to
GRAND
war dR.
ciated
Co.,
The
Golden has become asso¬
Dudley IL Waters &
Association
He
was
of
Commerce
previously with
the OPA.
—
& Co., Guardian Building, after
completing military service.
The Financial
Chronicle)
is wTith Brainard, Judd
Co., 75 Pearl Street.
(Special to The Financial Chronicle)
■-
T.
DAYTON, f OHIO
,
HI,
Johannes
—
Robert
George
come
associated
with
;
;
LOS
The
Financial
Noble
ford-Aetna Building. In the past
he was with Cooley & Co.
"
:
:
Brown has been added to the staff
of
Baker,
Simons
&
Co.,
(Special to
The Financial
.
Chronicle) ; ■;
HARTFORD, CONN.-—• William
MICH.—William P.
DETROIT,
Buhl
DETROIT,
MICH.—Edward
R,
to
the
is
&
now
Co.,
with
650
Chester
South
L.
Spring
>
|
INDIANAPOLIS, IND.—Robert
H. Springer has become connected
with City Securities Corp., Circle
Tower.
/
;
'#
•
Smith & Co., Penobscot Building.
(Special to
to
The Financial
♦DETROIT,^
-MICH.-
—
Porteous, Leslie W. Sachs, and
L.
-Thompson
&/
t
Harris
Co.,
&
Ohio
(Special to The Financial
Chronicle)
(Special to. The Financial
ANGELES,
Financial Chronicle).
The
L..
Montgomery has
Wall
Street,
New York
City,
Thomas Wallace Joins Staff
of Central Republic Co.
to
The
DENVER!
.
Wallace
Otis
&
""t;'. /) "
v
-
in
after serving
,
..
.
*
.
'•
X 7 "S
■
to The Financial
&
Scanlan
was
Chronicle)
LOUIS, MO.—Ben B. Soffer
become
The
Financial Chronicle)
R.
associated
Republic Company.
formerly with
was
Co., Merrill Lynch, E.' A.
Pierce
'
\
has
with Central
■
?Z}''; .%■?,•'
Chronicle)
Financial
COLO.—Thomas
Mr.
Building,
?£&■■■
:—i
Bank
Hz
:
-re¬
after serving in the armed forces.
Wallace
the U. §. Army.
//;
Rejoins Adams & Peck
Hale
LOUIS, MO.—Frank E. Pelton, Jr.,. has rejoined the staff Of
C; J. Deyine&;Co., Inc.> .Boatmen's
Cassatt
&
sales
Co.
manager
M.
Earl
and
In
the
past he
Johii G.
for
Perry & Co.
rejoined A. E. Edwards &
Sonis; 49 North Eighth Street, after
serving in the U. S. Army./;
formerly with
was
Brothers.1
-
:■ "
*
Loewi With
,;
with Friedman, Brokaw
to-
'
Chronicle)
»
& Samish,
ORLEANS, LA;—William
Lynch,
Pierce,
Fenner
RI8 Gravier Street.
&
Beane,
Locust Street, after serving in
U. S. Army.
\
At
a
M.
'
■
*
's
the*
Corporation held ony;
Co.,
holders of record
North
315
was
dividend of,•
a
declared on the
i
capital stock of the Corporation1"
payable January 30,1946 to stock!-!/
MO. —Charles L.
has become affiliated with
&
..
the Board of Directors /
LOUIS,
Simon
10,1946
of The First Boston /
$3.00 per share
Stone
was a
regular meeting of
January 10, 1946,
I.
East
he
Boston. Mass., Jan.
Clemens F.
—
business
on
as
of the close of
January 19, 1946, /
Fourth Street. Prior to serving ih
the U. S; Navy he was with;
1
In the past
DIVIDEND NOTICES
Commerce Bank & Trust Co.,; 721
ST.
with
North
37
partner in Schatzkin, Loewi & Co.
Forcade is again with Mercantile
«
Thompson Jr. is with Merrill
associated
Co.,
of New York.
'I
The Financial
&
First Street.
(Special to The Financial Chronicle)
(Special;to;
become
Clogher
The Financial Chronicle)
ST. LOUIS, MO.
Buckley
Clogher Co.
MIAMI, FLA.—Robert W. Loewi
has
Chronicle)
CALIF,—Lei
Edward J.
New*/
Costelio,|/
Treasurer
hard, Cook & Co.
(Special to The Financial
NE#
Chronicle)
.,
^
(Special
ORLEANS/ LAA-Edmund
ST.
Glenny has become connected
\Vith Wheeler
Whitney
&
Woolfolk, Inc.,
Building. / He was for¬
•
to -The Financial Chronicle)'
LOUIS,
Coleman
and
MO.
—
B.
Robert
John H. White are
with Slayton & Company,
Inc., Ill
North Fourth street,.after serving
in the armed forces.
NATIONAL DISTILLERS
products
corporation
The Board of Directors has declared a regular
quarterly dividend of 50^ per share on the out¬
standing Common Stock, payable on February 1,
on
January 15,
i946. .The transfer books will not close. ;
(Special
NEW
to
The
Financial
ORLEANS,
Ibers is wdth Weil &
•:!
Chronicle)
LA. —Max
Co., Richards
Building Arcade.
•
SAN
DIEGO, CALIF.—James I.
Robinson
National
(Special to
The Financial
OAKLAND,
k:
(Special to The financial Chronicle)-
has
been
staff of Wesley
k
added
to
^uilding; /
/ "y
•
y
CALIF.—John
December 27i 3945
'
W,
hen & Co., 8 East Market Street.
Co., Bank of America
Building.
'
TREASUEE»
•
i>penccr IteUogg &
a
quarterly
has
O'Neill is with Frank Knowlton
-
THOS. A. CLARK
the
HalT ^/Co.;/nrsi
Chronicle)
INDIANAPOLIS, IND.—Chester
;
v
(Special
(Special
ter «&.Co,; 634 South Spring Street;
He
•
WILMINGTON, N. C.—William
with
are
A. Parrish is with N, Leonard Co-
Stranahan,
Robert K.
Chronicle)
Gregory
Bader, Jr., has become, connected
—
ST. LOUIS,. MO. — Delmar H.
Robins has become associated with
LOS ANGELES, CALIF.—Lloyd
Edward D; Jones & Co., 300 North
M. Ibseii, Harold T. Nixon, Elbert
Fourth Street. He was previously
The Financial
\
Chronicle) v
C
Kirchofer/& Arnold, Inc.;
' •3'" *' f
(Special to
-
(Special
N,
I (SpeQlal to .The Financial Chronicle)
Shober.
Chronicle)
-
H.
joined the staff of Adams & Peck,
/vf;;
Insurance Building.-
ST.
merly with/WooHolk/ Huggins &
The Financial
*
Daniel
—
Building. He has been in the U. S.
Army for the past four years. In
the past he was with Prudden &
Co; and Otis & Co.
y ;
vr;
..
N, Lindsay; Jr., is with Robert S;
(Special to
i
Gaynor is affiliated with Chapin,
:
Morris & Co., 100 Pearl Street.
.
(Special to The Financial Chronicle)
OHIO
!946, fo stockholders of record
Building. He was formerly in the
U. S. Navy.
;
Chronicle!
With Sniith; Barney & Co.; Hart*
Chronicle)
staff of
-
Spring Street.
(Special to
B.
(Special to The Financial
„
Taylor has become associated .with
and Theodore T. Tib-
Creighton has been added to the
Company in the past.
N.
Chronicle)
HARTFORD, CONNT.t—Frank K.
\
staff
ANGELES, CALIF.—Geo. has
Hull
B.
Co.
Special to
<
Sutherland & Co., Ohio
I TOLEDO,
634
Hodgson Wood is with Dean Wit¬
Wood worth' has become affiliated
S^;^on/&
Co., Inc. of fSt. Louis.
of Ryan,
with J. Arthur Warner &
are
(Special
previously with Turner, Sachs &
P.
and Russell V. Petersen have be¬
Chronicle)
wpld has been added to the
63
(Special to The Financial Chronicl£)
LOS
Hickey is with Eastman, Dil¬
lon & Co., 75 Pearl Street. He was
r
Peirce,
A.
Co.,
Wolfe has been added
NEW
(Special to The Financial Chronicle)
connects
&
LOS ANGELES, CALIF.—Jas.
„
T.
f
-
are now
Cruttenden
(Special to' The Financial
•
&
HARTFORD, CONN,—Raymond
(Special to T»® Financial Chronicle)
CLEVELAND, OHIO — Gordon
M. Hull has joined the staff of
Slay ton & Company, Inc., of St.
to The Financial
ing & Co., Murchison Building.'
Co;, Chapman Building.
Slayton & Company, Inc.
Kohn
,
TOLEDO, OHIO—Roger b. Gris-
ME.,—Charles R.
•
ST.
•'
J.
(Special to
Samuel
bits
HARTFORD, CONN.—Henry Ci
■
CLEVELAND, OHIO
,
Streets He was with District Bond
Chronicle)
Financial
RAPIDS, MICH.—Ed-
,
with
Building.
Chronicle)
C. Crobaugh has rejoined Prescott
Chronicle)
Financial
M. Courtney is with Allen C. Ew-
RALEIGH,
South Spring Street.
Robert
(Special to The Financial
The
(Special to The Financial Chronicle)
(Special to The Financial Chronicle) /
.
Palmros, James R. PIant;/aiid
;
>
D. Palmer is with Gunn, Carey &
Chronicle)
ANGELES, CALIF.—Geo.
GRAND RAPIDS, MICH.—John \
CLEVELAND, OHIO — Richard
Prior
LOS
'
j(SpediilAltP- ftW: .PwaNCwifc Chronicle)
i
(Special tp. The Financial
639 South
have joined King & Co., Michigan
/National. Bank
Building, /after
serving in the armed forces.
-
is
staff of. Gross, / Van Court & Co.;
Chronicle^
(Special to The Financial
Commerce
V
was
FRANCISCO,
Building,
& Tyson.
McKenney
Chronicle)
ANGELES, CALIF.—Kau-
nold CLVer Lee is with; Bradbury-
•Ames
A. Smith and John E. Veneklasen
in the armed forces.
&
(Special to The" Financial Chronicle)
ed
ciated with Paine, Webber, Jack¬
-
(Special to The Financial
LOS
A.
The Financial
GRAND
J. Patrick has again become asso¬
Curtis, Union
A.
Coffin
Co.. 188 Middle Street, In the past
he was with Townsend,, Anthony
Co., 453 South Spring
Ja mes Wr. Selzer
V/'; (Special
.
&
Henry
—
with
(Special to The Financial Chronicle)
CALIF.—James
Chronicle)
Building, after completing service
past
CALIF. —
Talbot P. Kendall and Stanley J.
Steer are with Dean Witter & Co.,
45 Montgomery Street.
' ■ '•//;//.■ '
(Special "to The Financial Chronicle)
PORTLAND,
U
Johnson is with Walston, Hoff¬
man & Goodwin; Bank of Amer-
CLEVELAND, OHIO—Francis
son
&
with Quincy Cass
Associates, 523 West Sixth Street.
Chronicle)
the
'
/FRESNO,
Conners is now with Central Re-
(Special to The Financial
LOS ANGELES, CALIF.—Gid¬
S. Peirce is with Bateman,
,
ko A. Aho
(Special to The Financial
Hoffman
Montgomery
in
Plummer is with W. E. Hutton &
H.
ica Building,
(
ME.
now
PORTLAND, MAINE.—Earl M.
(Special to: The Financial Chronicle)
Vogel & Co., Penobscot Building;
Union A Com¬
merce Building. He was previous¬
ly with Merrill Lynch, Pierce,
is
PORTLAND, ME. —James K.
Oilman; Sr., is with Maine Securi¬
MO. —Elmer ties Co.; 465 Congress Street;
-:
F.
A.
265
Orr
to
SAN
|
Chronicle)
The Financtal
Chronicle)
Street.
en r y
with
Mr.
(Special
Burr, Inc., 27 State Street.
916 Baltimore Avenue, after
Eichler
(Special to The Financial
:
Goodwin,
Street.
Chronicle)
The Financial
PORTLAND,
Peterson
&
eon
DETROIT, MICH.—H
public/l Company,
to
Watson Pauly has joined the staff
of Prescott, Wright, Snider Com¬
S. R. Livingstone
&
with H. R. Baker & Co.
V.//:;-.
•
"(Special to
.
Building.
-
connected with Walston,
Place,-after serving in the armed
./'//-•
(Special to Tee Financial
•
CALIF', y-
previously with the Naval
was
'
"
Building; sifter serving to the U« S.
Navy.
added
FRANCISCO,
'
•
McDonald
Reserve.
Glas has joined the staff of Watr
kins & Fordon, Inc.; Penobscot
.1-it:-''
Chronicle) v
Financial
Nelson
PITTSBURGH, PA.—James H.
CITY, MO.—Harold
is
Knight
He
has become affiliated with Weiss,
^CLEVELAND, OHIO^James T.
>;; (Special
Chronkxb)
Company, 1009 Baltimore Avenue.
Chronicle)
with
now
v',',.
to The
(Special
Gor¬
don, Jr., is with Moreland & Co.,
been
SAN
Chronicle)
MICH.—John
is
forces!.
Lynch, Pierce, Fenner & Beane,
Fenner & Beane.
have
with
scot
(Special to The Financial \ Chronicle)
Building.
Kerner,
CINCINNATI, OHIO—J u s tin
Meyer; / formerly
with Merrill
armed forces.
with
Franke
V
—
Morris1
—
Knowles has rejoined Mellon Se¬
curities Corp., 525 vWilliam Penn
DETROIT,
B.
j
;
CALIF.
CITY, MO.—Alva N.
Jr.,
; •:
.
formerly
Chronicle)
William F. Belknap, Jack Cooper,
and Robert J. Orr have become
^
Douglas & Co., is now with John
M. Barbour & Co., Citizens Bank
Chronicle)
DETROIT; MICH.—William D.
Snyder and Norman G. Thursby
CLEVELAND, OHIO—James J.
Drnek has joined the staff of C. J.
Devlue & Co., Union Commerce
Building, after serving in the
Geggie,
Savings
Financial
The
r,Vi-.f.i,y:
£
Chronicle)
PASADENA, / CALIF.
Bank of Albion.
to
(Special
(Special to' IThb; Financiaj,
^ ;
•-
-
'/FRANCISCO,
Wayne
.' ii .i.;:/
inc.
formerly with
was
Gordon Michie, 582 Market Street.
C.
Com¬
/Slayiou: &
with
vv'-Vi-v.".-.I- -rC'V,-':K-fiuT
,!
Securities Com¬
have
Chronicle)
is
become
Work & Co., First National Bank
•
was
has
serving in the U. S. Army.
Chronicle)
j
OSBORN,' OHIO —>William
pany,
S.
associated
National Bank Building. He
pany,
:
Buhl Building,
(Special to The Financial
(Special to The Financial
i'
Chronicle)
dorf, and Bonnie G.
Co., in Pittsburgh.
(Special to The Financial
Financial
Fenner
DETROIT;
the past he was with W. H.I Bab¬
bitt & Co. and jC.« J.-Stubner &
The
ciated with Merrill. Lynch, Pierce,
-
CINCINNATI, OHIO—R. Phillip
jlerron has become associated
with Hill & Co., Carew Tower. In
to
|
& Beane,
ivt (Special
■
Carleton H. Lamb, Benjamin Nai-
(Special to The Financial
•
j
JACKSON, MICH.^—Charles
.
Chronicle)
forces.
.
-
,
Avenue.
rejoined W. D. GradiCo., Dixie Terminal Build*
(Special
Building.
after serving in the U, S;- Navy*?/;/
have
'
•
Diliey,
'
son
L.
ing. Mr. Cook
Gross, Van Court & Co.
with
DETROIT, / MICH—Thomas F.
Willmore, Jr., has become asso¬
Hughes and Hyman B. Klay-
man
'
.
Marxer ;& / Co.,
,(Special to The Financial
CINCINNATI, OHIO—Robert
W.
*
r.
(Sp'eclal to ''.Tirr .Financial "Chronicle)
v
;
I
Chronicle)
to The Financial
Wl| |,
;
.
Diego Trust & Savings Build¬
SAN
Oleson
fy
MICH.—Herbert
is -with
Nelson
been-to the armed forces.
Special
.
joined the staff of
(Special, to .The Financial
Campbell
I
has
Carr
"(Special' to The financial Chronicle)
■
Penobscot
Central
Clark
S.
Chronicle)
(Special to The Financial
Chronicle)
' i
CINCINNATI,' OHIO—Allan G.
has
Financial
M.
INDIANAPOLIS, IND. —James
DETROIT, MlCH^Iatthew/Bi.
'"/. (Special to^ The F^'ancial ' Chrontcle) //
Keinhart & Co., Traction
The
formerly
Burns, Pottef .&,Co.
/
was
'
■;v
Bohmer
(Special to
Penobscot
Co.,
Whittlesey, Jr., is with
Co., Penobscot Building.
vv
.
.
&
Slayton & Co., Inc.,
s
d;iqhal/Bahk Building.'/He//has;/rey
cently/ beerx in the U. 'S." Afrtiy; ;
.
•
Building, after serving in the U.S.
Navy.;* %;•
ATLANTA, GA.—Edgar C. Parrott has become * affiliated .with
Stockton Broome & Co., First Na-
John
San
Insurance Building. Mr.
Cunningham
;
.with
affiliated with Hope A Co.,
come
fee and Carl M. Cunningham have
(Special "to The Financial Chronicle) - -
<
*
SAN DIEGO, CALIF.—William
S. Cook, George S. Gillespie, Jr.,
been
March 9,
dividend
declared
on
of
5nt.
$0.45
the
per
stock,
1946, to Stockholders of record
of .the. dps,e of business February 16,
,
.
share
payable
JAMES L. WICKSTEAD,
as
1946.
Treasurer
THE COMMERCIAL & FINANCIAL CHRONICLE
286
'''«v:V
»'V'
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••
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j'-V:
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'
,
iV;i,
I
'
,
;
-fia
•
Thursday, January 17/. 1946
/ *.'• *
(jC ilendar oj JMew Security b Uitatipns
'
/;7.V7
1
•
<•
■
■
•('-'•
L41
Offering—The price to the public will
filed
by amendment:
underwriting—To be filed by
amendment. w.::.,'•••' 'v;' !;7:7 .i'-'vv'
be
NEW FILINGS
List
of
registration
whose
issues
MORRIS
PHILIP
on
filed
amendment.
by
i
7 ; 5
>
i|
•
'
Offering—The company offers to
the
holders
of
its
common
stock rights to
subscribe
for
the new preferred at the
rate of
one
and one-half shares of vthe
v'
cumulative
preferred stock, for each 20
shares of common stock held at a- price
to be filed by amendment.,.
1
" 7
<
Underwriters — Lehman
Brothers
and
Glore, Porgan & Co.; head the underwriting
3.
issue of Jan.
Details—See
Details—See
Offering—The price to the public of the
preferred shares will be filed by amend¬
ment.
"
Underwriters—The underwriting group is
issue of Jan.
Details—See
sold
by
'
J bidding.
3.
■
filed
SINCLAIR OIL CORP. on Dec. 26
dividend
the
of
cents
25
Underwriters-^To be filed by
statement
registration
a
1946.
offering
Offering—The
publio
share..
Underwriters—W. .R.
cents
per
1
■
;
.
Co.,
&
Toronto, Ontario, Canada.
fllli
'$50
,
and 150,000 shares of common, no
The common stock is outstanding and
by certain stockholders.
;is being sold
Details—See issue of.Jan.
•>
-
Details—See issue of Jan.
•
.
Offering—The
3.
r
10.
also
will
assenting
receive
entitling the
to
purchase
detachable
holders
20
the
to
war¬
to April
up
of
shares
$5
1,
par
-•
of
The
deposit.
will
be
shares
1,800,000
underwriter.
&
*
vby amendment j
Underwriters—Glore, Forgah & Co. heads
the underwriting group.
cents
on
stock
common
COLONIAL AIRLINES,' INC., on Dec. 27
filed a registration statement for 91,400
Details—See
of
issue
.stock
to
basis
of
its
share
each
for
offer
Jan.
,1
WEST
3.
on
the
on
fhree shares held.
Is
$20
price
subscription
The
The
share.
capital stock not
subscribed to by stockholders will be pur¬
chased by the individual members of the
board of directors of Colonial Airlines at
per
the
same
for
their
offering price
of
$20
accounts.
own
Underwriters—No
share,
per
'
:
'
•
filed
a
Bhares
HARVESTER
registration
of
CO.
Jan.
2
Jan.
filed
4
MINES, LTD;,
registration statement
of common stockp.$T
a
shares
currency
heads
stock
States
currency
U.
statement
for
.
28
S.
3.
Offering—The price to "the public will be
filed by amendment.
;
v
♦
..
Underwriters—Reynolds & Co. heads the
Underwriting group.
t
istration
tive
statement
of
for 17,000 6%
(par $20)
($3
common
par).
the
value each,
par
i
;
v
10.
to
certain
of
holders
the
offering its.
at 50 cents
share.
If the
per
share
per
for resale
share,;
per
currency
50
at
The
cents
estimated
'
'
CORP.
Dec.
on
statement
stock
POTASH
cumula¬
addition,
for
28
filed
CHEMICAL
registration
shares
of
capital
479,726
a
(no par)7 The shares
are
shares.
—
No
underwriters
named.
cisco, Calif.
:
I
'Business—Diversified dairy products.
V
Offering—The price to the public will be
filed by amendment.
?
;; Proceeds-^-To finance In part a program
,
company.
.'
issued and
to file the registration statement.
Details—See
issue of
Underwriters—The
todian
of
proposes
stock
at
qualified
cepted
to
will
to sell
public
if
the
sale
*
<
shares
479,726
to
the
;,
Cus¬
highest
If any such bid is ac¬
the successful bidder plans
the
amended
Additional
offered
3. -'
Property
bidder.
and
distribute
be
Jan.
Alien
shares
to
information.
constitute
issue
requisite
shares
of
CORP.
shares
be
to
the.528,390
' ' ■>
'
-
ECONOMIC
28
registered
20,000
stock, $100 par value.
Details—See
prospectus
the
'The
90.79%
Bhares outstanding.
PALESTINE
the
include
of
on
of
additional
an
.152
held
shares
as
5%
convertible
Details—See
Dec.
for
28
shares
at
price
a
The
preferred stock,
issue of Jan. 3.
will
used
be
to
extent
of
to
be
The
underwriters
a
reg¬
shares
par
i
•
of
$25.
.
INDUSTRIAL
S.
U.
has filed
of
N/ Y,
Business'—
are
stockholders
each
Underwriting 4,250
and 8,500 shares of
the
of
S-l.
be
and
outstanding and
certain stockholders.
Details—See issue
of
.
7
are
'
Jan.
FLORIDA
filed
'
PRODUCTS
scribed
statement
ration
Boston,
those
of
and collateral trust 20-year 6%
1948.
securities
in
tension
price\to
issue
of Jan.
is
desired
connection
sinking
sink¬
to
collateral
holders
trust
of
an
fir"t
20-year
/
10.
6%
offer
of
mortgage
sinking
Dec.
Co.
-
of
Mutual
24,
with
the
New
Life
from
the
stock,
as
and' possibly
i
Mutual
York,
and
Insurance
Life
John
Co.
of
well
as
sale
the
a
of
the
proceeds
portion of
common
from
tho
its futute
resources
will
to carry out
extensive program for additional manu¬
facturing
f
:
issue as of .Dec. 15, 1945, to
companies for investment $4,4
and $3,500,000 of fifteen year 3%;
fund
notes,
respectively.
The
notes,
an
all
sub¬
the corpo¬
1945,
net earnings or present cash
be applied by the company
ex¬
and
price,
subscription
the
to
proceeds
below.' The deposit
as
a
preliminary
with
ad¬
is entitled
two
000,000
cer¬
ing fund bonds due April 1,
step
a
by other stockholders.
contracted
Insurance
\
for
at
for
Proceeds—On
CO., INC., on Jan.
registration
shares that it
common
Hancock
WEDNESDAY, JAN. 23
gage
at
shares of common, stock which are not
group is headed by
Loeb, Rhoades & Co. and Smith,
Barney- & Co.
a
UTILITIES
CO.
has
6,000
par"$100;: The stock Is issued
standing
and
does
not
represent
financing by the company.
Datura
Street,
new
West
Palm
operating
com^
v
in
Offering—The price to the public is $103
share.
being
all
All
—
offered
the
of
is
by J.
company, who
present
In
company.
all
L.
Terry,
also owns
stock
common
April,
of
stock
preferred
owned
the
of
the
of
the
of
1945, Mr. Terry purf
capital stock of the
the
company for approximately $1,140,000 and
received
the
6,000
shares
of
preferred
stock
from
the
•
Ofct.
York-on
another
corporation
formed
was
packing" and
to
provision
for
company
}
will
at
the
so
as
the
Inc.,
be
channels
to
sold
is
011
behalf
on
Syndicate.
through
the
of
The
secur¬
regulur
market
the New York Curb Exchange
obtainable in small lots
over
best
not
stock
public
Exchange
Gobel,
ities
common
sale
York.;Curb
V
m'*r *\
being
the New
,
Adolf
price
to
unduly depress/the
market.
propsed
63.9%
of
stock
offering
constitutes
company's outstanding comThere are J2 members in the
the
stock.
„mon
syndicate.
v
.
5
7 Proceeds—The net cash proce'eds' will toei.;
obtained by the selling syndicate.
Underwriters—No underwriting discounts
.
,
and commissions are
being paid. '
'
»
Registration Statement No. 2-6090. For-m
(1-10-46). ■
'
•
'
;
WEDNESDAY, JAN. 30
DOYLE
as
stock
a
MANUFACTURING
registration
a
of
100,000
stock;
shares
series
A,
of
the
and1
The :
$1.
for
reserved
50,000
$8,
par
common, -par
are
upon, conversion
for
convertible
cumulative
of
shares
common
has
CORP.
statement
60-ccnt
preferred
issuance
preferred
the
on
-
basis of two shares of common for one
share of preferred,
t
r
■/Address—320-6 West Tayjof Street, Syra¬
Y.
N.
BusIness-^-Pre-war. business consisted of
high precision machinery, tools and parts,
etc..
per
Proceeds
meat
V;/ Offering—The
cuse,
utility
p ahy;7;:S7::;: ■•:•;■■
■ferry,'::;;7■■ ■;
Offering—The offering price of the pre¬
ferred will be $10 per share.
Proceeds—The proceeds will
be
increase
for
general.''!
by
amend¬
working
capital
corporate purposes.
Underwriters—To
be
and
filed
used
to
ment.
:
Registration Statement No. 2-6091.
8-2.(1-11-46).
Form
*
divii
:■'■;; 7$
Underwriters
Starkweather
Co.,
Inc.;
The ' underwriters
—
&
Co.;
Clement A.
PRINCESS
are
Evans &
Robinson-Humphrey Co.; Leedy,
Co., and Stockton Broome &
plant
facilities
tion of chemicals,
for
the
produc¬
Including butyl and octyl
fund, alcohol, and resins at Baltimore, Md., and
INC., has filed ft
for 40,000
shares
preferred stock, $5 par,,
40,000 shares of common atock, par
and
Registration Statement No. 2-6087. Form
TAYLOR INSTRUMENT COMPANIES has
a
shares
total
*
registration
of
shares
$20
par.
being
are
30,750
for
statement'
stock,
common
21,170
sold
Of the
to
un¬
will.
-
Winn
Mr.
Chairman
was
of
the company
at.the time of his death.
Address—Rochester, N. Y.
:
;
dicating,
recording
perature,
pressure,
instruments
for
f
in¬
and controlling tem¬
humidity,
flow and
liquid level,
Offering—The price to the public will be
filed
by amendment.
The price to the
employees is $18 per share.
Proceeds—The company will
add the net
proceeds from the sale of the 21,170 shares
being sold to* underwriter^ to Iit$7,wdrkini
capital funds.
Underwriters—The
headed
is
group
Fiist Boston Corp..
•
by
'
•
A-2, < 1-10-46).
has
:
r
;
•
,,
DEPARTMENT
FEDERATED
INC.,
filed
a'
registration
.
:
STORES.
statement
be offered
to
Its
:-
.
agents
shares
Inc.,
Straus,
and R.
shares
price
Bloomingdale
Lazarus
Federated.
As
Federated
of
per
common;
Filene's
unit
As
receive
of
to
&
Bros., ■ Inc.,
Co;, subsidiaries
to
preferred
share
of
of
40,000
shares 6f.'
aggregate
and
40,000
share of' preferred
at ,$11.25 per
one
common
Tho "Underwriters
will/ offer 4,400 i
Schwartz, President 0^ the
$L1.25, without any under¬
writing discount or commission; Also 2,000
units
to
Louis
at
company,
units are to be offered to employees and
2,000 units to Edwin M; Reich, director
and counsel, at a price of $10.40 per uni,t.
A total of 31,600 units are <to be
offered
for a period of 15
days to stockholders of
,
the
at
company
unit
shares
the
basis
the
on
two
of
price
of
of
for
every
stock
preferred
or
p6rV
$11.25
unit
one
common
held.:-, 7
'■/ :
7
; Proceeds—Approximately $200,000 of
proceeds
stores
be
thef
will
be used to open additional
approximately $125,000 for the
and
repayment
bank
of
used
to
loans.
balance
The
modernize existing
departments, etc.
creation of new
stores, :
shares
1%
stock,' at
of
i
h
v
Colony
Corp.
and!
Childs, Jeffries & Thorndike, Inc.
Registration Statement No. 2-6092. Form
S-l. (1-11-46).
7
SATURDAY, FEB. 2
THE
of
7
GEORGE 7PUTNAM
OF
FU>*D
has
registered. 1,000,000
interest.
Address—50 State Street, Boston,
sharfs
beheficial
Business—Management
trust
Mass.1
for
fund
individual and institutional investors.
Offering—At market. •'
'
,/Proceeds—For investment;
•
:
7
,
£
.
Underwriter—Putnam Fund
Distributors,
Inc., is named principal underwriter.
:" •£
Registration Statement No. 2-6093. Form
A-l7 (1-14-46),
shares to -be
receive 156,725
common *
a;
Filene's
to
30,486 shares, Federated
15,243 shares of Abraham &
common,
previously registered and became ef¬
Sept.
6, -1943, to be offered in
exchange for common stocks of Filene's,
Abraham & Straus, Bloomingdale and Laz¬
were
fective
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
arus,
present
an
in units of
one
unit."
sell
1
1
'
,
94,035
is
at a price per unit of V2
of a share of Abraham. common. As to
23,588
shares,
Federated
is * to
receive
31,451 shares of Bloomingdale common, at
a
price per unit of IV3 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
share of Lazarus common.7 Of the 151,694.15
shares
registered,
116,315
shares
Straus
to
of
common
and
in exchange for common
of Wm. Filene's Sons Co.,: Abraham
stocks
the
York,
//
.
,.
Company owns subsidiaries
sell women's and children's wear.'
Offering—The company has entered into
on agreement with First
Colony Corp. andChilds, Jeffries & Thorndike, Inc., whereby
the company employs the underwriters as
BOSTON
■
to
.
^
Underwriters—First
owning di¬
rectly and indirectly securities of corpora¬
tions enegaged generally in the operation
of department and specialty stores.
j ■
Offering—Of
the
securities
registered,
151,694.15 shares of common of Federated
is
.
.
which
covering
151,694.15
shares of
common
stock, no par value.
7 Address—Principal office, 707 Race Street
of
j
v
...wBusiness
will
Registration Statement No. 2-6088. Form
&
:t /
Address—108 West 39th Street, New
N/Y.;
.
filed
are
statement
cumulative
50 cents.
&
•1. (1-9-46),
SHOPS;
registration
60-cent
.
CO.
offered,
held
that it will subscribe to all
stated
vestment,
■
the
;
stock;
and out¬
Business—Public
of* New
succeed
name,-which,
which was started
by Adolf Gobel
1891. 1
;•
.
filed
"
''T
.
PUBLIC
Street, - Brooklyn, N. TV!
Inc., was organ¬
Gobel,
law's
under¬
registration statement for
4%%
cumulative
preferred
a
shares
to
same
shares
shares
7
by virtue of its ownership of *106,050
shares, and it will also purchase, for in¬
M.
W.
*'
'
the
1944,
acquire
filed by amendment.
r
Statement No. 2-6086. Form
'
and F.
to
being sold
Underwriters—The
filed
be offered
Air Reduction CO.,
106,050 shares out of a total
shares, or approximately 24%
owns
ditional
Offering—The price to the public will be
by amendment.
A. P.
at
each
436,836
has
filed
4
'
.
10."
the
(1-9-46).
✓
to its present common
the rate of .one share of
of the outstanding common. v Air Reduction
JULIUS kayser A CO. on Jan;? 3 filed a
registration statement for 153,400 shares of
common
stock
(par $5).
The shares are
Carl
resins
:>
be filed by amendment.
Inc.,
-
Chemicals,: synthetic
company
for
new
TUESDAY, JAN. 22
by
(no' par).
^
York,
Offering—The new stock will
common.
issued
stock
industrial alcohol.
and
waukee Company,
preferred
common
'
by
of
INC.,
Address—60 East 42nd Street; New
Kebbon, McCormick & Co.; Bacon, Whipple
& Co.; Farwell, Chapman & Co., and Mil¬
shares
CHEMICALS,
registration statement for 62,-
a
405 shares
.
—
17,
of, the
Building, Cincinnati, Ohio, and 1440 Broad¬
underwriting
under
S-l.
of
names
way,'^ New York; N. Y. *
Business—Holding company
MONDAY, JAN. 28
.
Details—See
filed
300.000
will
Registration
additions.
Francisco.
filed by
agreement
provides that as partial compensation to
the underwriters the company will grant
them ' options ; to purchase
an
aggregate
of 10,000 common shares at a price to be
filed by amendment.
/ i
mon
Extension Offer—See
on
and
Underwriters—The group is headed by
Blyth & Co., Inc.
Registration Statement No. 2-6084. Form
S-1.
(1-4-46).
Originally filed in San
agreed to exchange 336 shares of
presently
outstanding
6V2 %
cumulative
prior preferred owned in her own right
Underwriting—No underwriting.
statement
improvements
has
tificates of deposit of $2,000,000 first mort¬
Offering—The offering price to the pub¬
per share.
TEXTRON, INC.,
capital
Treasury funds
$2,300,000.
common
3.
lic is $100
istration
,
Offering—The price to the public will
be filed by amendment.
Mae A. Urbanek
Dec.
1
of Jan.
.
;
of, such
In' respect
'77
77
0?" Jan. 10,
company
7/;7
Details—See issue
outstanding and are being sold by
the
Alien Property Custodian who directed the
company
writers
.
No
under¬
writing discounts or commissions are pay¬
,1
,
&
Underwriters—The
his
sold.
CO., LTD., has filed a
registration statement for 50,000 shares
cumulative preferred stock, par $100.
The
dividend rate will be filed by amendment.
The preferred is convertible into common
stock on or hefore Dec. 31^ 1955.»
Address—425 Battery Street, Ban Fran¬
outstanding
of
which
of
rayon
Wheeler
company
is
to the public
currency
Underwriters
and 34,000
In
content
to be raised by the company is
derwriters
by
the
company j and
9,580
U. S. currency maximum, anji.
shares are offered to various employees
U. S. currency minimum, if afl- 'of
the company by the estate of Herbert
the shares are sold by: dealers, and .as?
J. Winn, deceased, pursuant to the terms
suming- in any event that all the shades
of
2,600 6% cumulative-preferred shares and
76,000 common shares are being offered
securities
fiber
primarily rayon but occasionally may be
Business—Scientific
preferred shares
Underwriters
'7:777 7: •':<:: -id::
-
AMERICAN
the
and
natural fiber or blends of natural fiber and
proceeds
are
Business—Adolf
ized
The
-
woven-
$195,000
KELLING NUT CO. on Jan. 2-filed a reg¬
amendment.
101,769
stock,J par $1.
common
Details—See issue of Jan.
fabrics
of
$300,000
for 2,600 shares of new'6% cumu¬
preferred.
The Kelling family have
agreed to purchase a total of 76,000 com¬
Dec.
on
Converters
—
in December, 1945.
All of the pro¬
ceeds from the sale will be received by Mr.
accepts offers from dealers to
purchase the stock, the company will sell
to such dealers, if any, at 32.5 cents U. S.-
trustee
DETROIT
is
--<•''
*•
,
knitted
Avenue,! N^w>York,
Sixth
of.
dend
lative
16
Y;
Business
underwriting group,
and
underwriting.
WEDNESDAY, JAN.
and
Company
.,
10.
Burr
Otis
are
eac$, and Allen & Co., 450,0(Jp
common
Offering—The price to the public will be
by amendment.
; .
:
&
of
.
United
filed
able'^by/'the ■
for each
share
stock.;: The shares
outstanding and are being
19 selling stockholders;
chased
Offering—^The
sinking fund debentures, due Jan. 1, 1961.
The interest rate will be filed .by amendment;777f:7*7"7^
Underwriters—Coffin
commission
a
and First California Company, 675,shares
Canadian
shares
10
,s)iare, i;,
CO.
the
$1,620,000.
for: 600,000
/■
DISINFECTING
'the ratio of
company
additional
N.
issue
Co.
on
registration statement for $1,500,000
a
shares
its
one
by
capital
AddresSr-^1071
of
the
Underwriters—None.
filed
with
The
per
Details—See issue of Jan;
•
for
offering
shares.
GOLD CITY PORCUPINE
stockholders
common
one (
only
of
issued
are
sold
President
000
RICH'S, INC., oil Jan. 2 filed a registra¬
tion statement for 11,070 shares of common
stock (no par).
is granting to
capital stock of a date to
be fixed
in
January, the rigjit- to sub¬
scribe for not in excess of 91,400 shares
of authorized but unissued capital stock in
Offering—The
holders
of
Beach, Fla.
GOLDEN STATE
<$10.'
registration statement for 123,-
shares
regis¬
a
shares
eate.;:':?'-*::".;;v": /'■ iV'i.j';:
71Address—?4 Rock
offered
NATIONAL MALLINSON FABRICS CORP.
a
412,89.9
business
■
share by the same group
which purchased the September public of¬
fering, or a total underwriting commission
shares.
Details—See issue of:Jan.* 10.
Offering—The company will
the
rj
;
;
■
by the selling stockholders.
dftte
Underwriters—The underwriters
4
Underwriters—None.
7
of
outstanding
underwritten
will be
.
time
the
at
presently
the
to
Details—See issue of Jan.
preferred and common stocks will be filed
shares of capital stock, par
Chemicals, Inc.
■
the
Petro¬
1946,
Jan.^reg-
on
of
for
of
processes
under
first
deposited
Feb. 1,
be
may
offer
con¬
fiber. , ;
•
»
< •.
*
■
Offering—The price to the public will be
filed by amendment.
Proceeds—The proceeds will be received
$7.50 per share, depehdiqg upon
or
bonds
plants
or
of
the
for
stock,' <par $1.
The shares
are
issued and
outstanding and are being sqld
on
behalf of the Adolf
Gobel/ Inc. Syndi-
also
Registration Statement No. 2-6085. Form
(1-9-46).
V"i
1:4
ex¬
each $1,000 bond at the price
per
date
tion
90
the
of
offering -prices
Those
in
GOBEL, INC., has filed
staement
common
stated
company
The program
plant
a
S-l.
that it will be related to the market quota¬
public $25 peir'
share.
Securities
are
being sold by the
cooperative directly to stockholders and
friends interested in the cooperative move¬
ment
without
the
interposition of any
Offering—Price
Dec
on
registration statement for 40,000
cumulative preferred stock,
a
4%%
par,
par.
;
CORP.
PRODUCTS
SIIELLMAR
27 filed
4%
registered 20,000 shares
cumulative
dividend 7 non-voting
owned at the. price of, $70t per
TUESDAY, JAN. 15
Bhares
considera¬
Offering—The public offering price hits
not been determined, but it is anticipated
MONDAY, JAN. 21
price;is
1 ^ ^
Manning
in
Details—See issue of Jan. 10.
29
Dec.
on
1,250,000
chares of $1 par value stock, non-assessable.
Details-XSee issue of '.Jan.' 3./77W7/77;
•'
35
receive
to
and debt reduction,
therefor, 20 shares of $5
stock per each $1,000 ex¬
KAISER-FRAZER CORP.
preferred stock,1 series A ($25 par).
amendment.
for
.
and
$1,000
extension
bond.
istered
MINES, LTD., on Dec. 26 filed
CUES GO
each
amount, of
•
WHOLESALE,
EASTERN COOPERATIVE
INC.;
''
15,
Jan.
•
will
of'
commercialization
Address—338
share which
15, 1946,
per
record
of
$900
such
6%
the
and
the extension offer will expire on MArch 1,
1946, or such later date as the cdhipany
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,
,.<&
i;
THURSDAY, JAN. 17
has been declared payable on Feb.
stockholders
the
a
Offering—The price to the public will
be filed
by amendment.
The statement
gays
shares purchased upon the initial
offering will carry the right to receive
to
to
of
of $6.25
be filed by amendment.
Underwriters—Union Securities Corpora¬
of
3..\
the
to
460
20-year
principal
which
3.
the public
to
The
Conn.
fully worked out.
of
common
tion heads the underwriting group.
registration statement for 100,000 shares of
common
stock (no par).
The shares are
issued and outstanding and are being sold
a present stockholder.
Details—See issue, of: Jan.
price
trust
extension
.
of. Jan.
issue
Details—See
been
struction
; :
offers
ADOLF
tration
laboratory
scope of the program has been
upon-but the details have not yet
contemplates^participatlpn
company
Olcott,
&
general
has filed
the
Dodge
research
new
^pUnderwriters-^None.
1955,
group.'
Stamford,
the
a
leum
rants
a
Offering—The
capital
at
decided
sinking fund
bonds due April 1,
1948, the privilege *of
assenting to the extension offer providing
for the extension of the maturity date to
April 1, 1966, the reduction of the rate
of interest to 5% per annum, the reduction
tended
Co.
amendment.
Underwriters—To be filed by amendment.
;
filed
($5 par)
shares
*
/
par" common
INDUSTRIES, INC., on Dec.
registration statement for 40,000
shares of cumulative preferred stock, , par
$100,
The dividend rate will be filed by
price to the public will
amendment.
The bonds will
the company -at competitive
by
&
of
collateral
tion
NEWPORT
28
Offering—The
filed
Peabody
CO., INC., on Jan.
$2,000,000 first .mortgage and
20-year 5%
sinking fund
for
and
Inc.'s production of insecticides at Bayonne,
N.
J., and Fairfield, Baltimore; and the
without "payment
:
Underwriters—Kidder,
N.' J.,
holders of its $2,000,000 first mortgage and
bond
Offering—The price to. the public will bp
"
,
3.
filed by amendment.
a
1976.
:
'
PRODUCTS
end .80,000
tension
GAS
filed
26
.;
.
'77
annum.
trust.
Offering—The
The divi¬
will be filed
;
.
of Jan.
per
Newark,
maturity
1966, and the reduction in
Details—See issue of Jan.,10.
UARCO, INC.,
on
Dec. 28 registered
56,161 shares of common stock (no par).-:
7 Details—See issue of Jan. 3, - '
& ELECTRIC CO. on
registration statement for
$4,500,000 first mortgage bonds, due Jan. 1,
by
/
heads the underwriting
MADISON
7;
preferred
.
issue
W.
Stock.
.
group.
be
stock.
P.
bonds
headedbyHemphill.Noyes&Co.andpall;garten & Co.
'
.
"
be
the
amendment.
by
registered
are
preferred
rate1 on
dend
LTD., INC.
CO.,
&
registration
a
for
tificates
statement for
149,883
shares
of cumulative preferred
stock, par $100.
The dividend rate Will
filed
26
shares
common
A.
4
collateral
initially to be
reserved for issuance in the event of the
exercise
of the
non-detachable warrants
for
common
stock
attached to the cer¬
The
the
of
of interest to 5%
rate
>
..
Dec.
on
extension
construction
registered 75,000 shares of cumulative
preferred stock (no par) and 75,000 shares
of
common
(no
par)
and- 75,000 ^ondetachable
warrants
for
common
stock.
MONDAY, JAN. 14
.Dec.
the
28
SEC.
be
CORP,
PICTURES
COLUMBIA
the
date to April 1,
.
'Vi.?; v,.-'
statements were filed less than twenty
days ago, grouped according to sHtt
on
which registration statements .Will
(n normal course become effective, un¬
less accelerated at the discretion of the
Dec.
bonds' for
registration statement becom¬
ing effective.
' '
Registration Statement NO; 2-6089. Form
A-2. (1-10*46).
■
-
•
McALEER
filed
MANUFACTURING
registration
w
shares 5%
statement
has
CO.
for
50,000 *
cumulative convertible preferred
stock, par $10,
■mori, par $1.
and 50,000 shares
of
;
com-
f
.
.^Address—Fourth
and
Water
Streets,"
Rochester, Mich.
'
7*
;
•
7
Business—Developing, manufacturing and
industrial
polishing, *,.buffing and
selling
deburring compounds and compositions and 7
polishes, waxes and cleaners.
automobile
To
its
so-called
has
pany
carriers
automotive
added
and
a
cleaner.
vacuum
$5
$10
per
share
per
used
to
purchase
Stock
chase
of
for
$270,000
ceeds
7
the
the
was
already
be
/
com-
'■ side-car 7;
;
.
the/public will •!!
the
preferred
common
and 7
stocks.
'
■>
proceeds, $345,000 will
balance owing on the
Reel
Co.
$615,000,
paid.
p.pplied
The
which
Part
to
the
of
common
full
>
.!
pur-;?:/
includes 7
the pro¬
purchase
of
equipment,-development work, etc.
Underwriters-^-The
writers
to
price of 7.889 shares of
Bronson
will
various
for
the
pay
price
.
price
share
Proceeds—Of
be
•
<
/ Offerlng—The
be
line' the
wheel-chocks,
compressed 7 air-operated 7;
will
be
filed
names
of "the
under-
by amendment.
,
,
7
U:
7
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4456"' 7
163
Volume
TRUST
INVESTORS
has .-i filed-; a J registration
for
statement
7
'&■<7 :;1V: %'4f.
with
y
~
'Underwriters—John
named
fuUyAt|ian^era^lg:..ftnC.iefi?em"
able shares.
Offering—The price to the public is 30
per share,
• :7.
William
Langs
is
cents
77:
business—Oldest Boston type investment
fund
CARRIER
~
CORP.
istration statement ;for 120,000 shares of
cumulative preferred stock
(par $50), 4%
Pfoceeds—For investment. v '
*
(Underwriter-r-Vance, Sanders & Co., Bos¬ (-series.*' :
777'.7^: v;
7< r:\77
Details,—See
issue
of
Dec.
20.
ton, is'the sole principal underwriter and,
as
Offering—Shares are being offered, pro
principal, sells shares to investment
dealers.and also to investors.
•
rata,at par at;rate of 22 shares of new
iRegistration Statement No. 2-6095. Form preferred stock for each 100 shares of
8n2. (1-14-46).
•
i common stock held ,of |ecord Jahi;
Rights
,
expire Jan. 22.;',* 77
Underwriters—Harriman
(.GROUP SECURITIES; INC., has filed a
registration statement for 11,500,000 shares
o( capital stock of the par value of one
.
cdnt
share.
a
'
'
1
tAddress^-No.
City,
Inc.
Exchange
Place,
value
-
plus
7777I"7,
&
Ripley
Co.,
head the
& Co.
Noyes
'
777777';.
BISCUIT
CO.
Dec.
on
registration statement for 80,750
shares of common stock; par $1.
Details—See issue of Dec.; 20.. i;: v
a
Offering—The
.
'Underwriter!*—Distributors
Group, inc.,
K '
>\ y.
'Registration Statement No. 2-6096. Form
to
is; sole underwriter.
stockholders
common
time
stock will be offered
new
'RELIANCE
ELECTRIC &
record
of
some
reserved
shares
for
an
shares
cdmmort
;
number
of
conversion
1
'
which
^
'7(1
Road,
for
Cleveland, Ohio.
CO.
presently
owned
by Electric Power & Light Co.,
parent?'of' Dallas,-tfihd proceeds from1 the
sale will be received by Electric Power &
Light.
' ,7;, ■
- (-7 7^
jaids Invitedr--Electric Power
Light Co;
is inviting bids ' for the purchase' of the
—
The
shares
are
-
E.,
N.
TERMINAL
&
registration statement
of
common,( stock
'
a
Details—See issue of Dec. 20.
l quired; for1-; ^uch;i purpose.
Ivanhoe
filed
13
162,500 " shares
Offering
Issuance upon- conversion of its •- $5 con¬
vertible preferred and which were nottreAddress —1088
Dec.
(par $20).
pre¬
number of
reserved
were
RAILWAY
DALLAS
for
common
the
of
indeterminate
and
"
*"
.
vBusintas^Principaily the niattufacture; Of: stockBids
will be received at ^its (office,
general-purpose electric motors.
2 Rector St., New York
up to ; 11 a.m.,
(Offering—The price to the public on the
Jan. 21.
preferred and common shares to be offered
by underwriters Will be filed by amend¬
EUREKA CORP., LTD., on Sept. 28 filed
ment.
The.-shares of common stock .to be
a
registration
statement
for
2,595,000
otfered are'the shares of common stock to
shares of common, par $1.
be
purchased by certain of the under¬
Details—See issue of Oct. 4.
u
writers at S21 per share and are the shares
Offering—Toronto Mines Finance, Ltd.,
which were reserved for issuance upon the
has
entered
into a firm commitment to
conversion of the $5 convertible preferred
purchase ; 480,000 ( shares
at
$1.33 7pei
stock
and which were not required for
share, and has; an option on 1,920,000
such
purpose.
The statement says
the
shares at the same price. ;•; The offering
company called for redemption, on Feb. 1,
is to be made among the shareholders ol
1946, all of its outstanding $5 convertible
Ventures, Ltd., Frobisher, Ltd., and La
preferred, of which 6,500 shares (exclusive
Luz Mines, Ltd. (Canadian "companies) at
of treasury
shares) were outstanding on
$1.35
per
share, and to Eureka stock¬
Oct. 31, 1945.
The holders have the right,
or
on
into
same
r
Jan.
before
28,
1946,
stock
common
the basis of 5
on
holders.
convert the
to
Price
Canadian
will
be
not converted into common;
cials and
the proceeds from
construction
the
of
itself
The
about S..50.0CO
not
terms
oi
acquired
so
the
the
will make
remaining
offering,
195,000
aforesaid
as
shares
be
to
are
building,
new:
a
in
purchased by the company geologist, offi¬
employees.
GENERAL INSTRUMENT CORP. on OA
the
for
Shares
money.
Should
for
expressed
offered
the
sale of preferred and common stock
will
be used to reimburse the company's treas¬
ury
for the redemption on Feb. 1. 1S46,
of the $5 convertible preferred which were
Proceeds—Part of
is
generally to the public
option
not
be exercised by
Toronto Mines Finance, Ltd., the companj
shares of common for each preferred share.
;
purchase of machinery and equ.pment
for the new
building, etc.; aLout
$600,000 may: be used for the purchase or
erection
of
an
additional
plant for the
production of the company's smaller motor
25 filed
a
3hares
cumulative
frame
registration statement for 60,0d0
convertible
preferred.
260,000 shares of common,
par $1.
dividend rate on the pre¬
ferred will be filed by amendment.
The
the
common
now
$20
sizes, and $230,000 may be used for
purchase of machinery and equipment
being used by the company under a
facilities contract,
Navy
Underwriters
—
'
-
Hayden,
Che
&
Co.;
Shepard & Co.; McDonald and
Maynavd H, Murch & Co.; Merrill,
Turben & Co., and Curtiss, House & Co.
issuance
for
stock
Offering—The
GENERAL
price
issue
Offering—The
of
to
AMPAL-AMERICAN PALESTINE TRAD.
CORP. on Oct. 3 filed a registration
price
public
;
h
$5.50 per share.
[ Underwriters—The
shares
,
will
be
sold
through the efforts of the directors and
employees of the. corporation.
S BERYLACA
GOLD
YELLOWKNIFE
LTD., on Dec. 10 filed a registra¬
for 5,720 shares common
MINES,
statement
tion
(par $5).
;
Details—See issue of Dec. 20.
stock
!
7
•
s
CORP.
of
subscription.
Dec.
v
14 filed
Details—See issue of Dec. 20.
Offering—The underwriters
at-$100 per share. 7 This offer ex¬
pires on Jan. 30, 1946. The balance of the
stock will be publicly offered, after ex¬
piration of offering of foregoing shares.
:
Underwriters—:None named. 7
LIQUID CARBONIC CORP.
filed a registration statement
shares of 3 xh 7
offering
filed by
be
may
eventually offered under the prospectus all
or a
part of an. additional 15.000 shares
of
common,
company
to
issued
and
delivered
Industries, Inc.,
Lee
by
on
the
Aug.
1945, Buffalo Bolt acquired the assets
subject to liabilities of Eclipse Lawn Mower
Co. from Lee Industries for 15,000 shares
10,
of
Bolt
Buffalo
to
distributed
shares
the
were
its
Buffalo
of
market
then
.worth
dissolved
common.
stockholders
Bolt
Sept.
17,
•Underwriters—Van
heads
the
of
Lee
Industries
the ,15,000
common
value
$150,000.
on
Lee
$lo
underwriting
per
at
share
Industries
Noel
group.
PACIFIC
7
&
was
Coi
COAST
/
,
convertible
&
for
Co.,
Inc.,
and
principal under-
PORTLAND MEADOWS
registration
unsecured
income
notes
Dec.
on
statement
for
due
Jan.
1,
RED
BANK
registration
common
21
72,810
Dec.
on
for
;
;
S,
1971,
107*
and
Nov.
on
to
for
be
noon,
J ;7 :7 ^
'
NATIONAL LINEN SERVICE CORP.
share.
corporation
of
AYzfo
cumulative
vertible preferred stock par $100 per
Offering—The
of
shares
and
of
share.
-
offering
<
to
cumulative
4Vi7«
equipment
a
be jus*
of
through
of
Cincinnati
and; John
Nordman
Co.#
filed
a
shares
registration
of
statement
4V2%
stock, par $100.
on
to
the
on
to
be
list
Curb
sold
a
the
on
150.000
under
OSAGE
this
OIL
registration
of
class A
Oil
Co.
New York, N,
cumulative
OHIO —Samuel
of
made
doing business
now
|7 (Special to The Financial. Chronicle)
|
CINCINNATI, OHIO—Jack H.
Neumark
has
been
CO.
Aug.
on
for
admitted
$105.
-
dendorf
and
Gordon
13
cantile Library
113,468
M.
Evans
&
Co.,
Inc., Atlanta, Ga. heads the group.
filed
220,000
165
Building.,
SITUATION
WANTED
Broadway
shares
a
LAKE
MINES, LTD.
registration
of
capital
statement
stock,
ot
foi
7
•
7
%
■Trader
^
$3
par
(Canadian).
preferred
''*•••
*.
listed
.
...
,
Years'
12
;,,v7'
.
experience in
securities.
from
service.
Prefer association with
ber
ASSISTANT TRADER
.
-
7
Large
investment
ing; ^or
cial
house^f
many years' standing
of New York
registration statement for $12,000,000 first
3*a?»- bonds
issue
Underwriters—The
due
of Dec.
Dec.
15,
13.-7
underwriting
-
1970.
^7' 7
group
mem¬
Stock Ex¬
change. Box R 110, Commer*
:77'
>;
■
un¬
Recently
SITUATION WANTED
discharged
Underwriters—E. H. Rollins & $.ons, Inc.,
heads the Underwriting group.
Financial
&
25 Park
has open-v;
'N." Yi
experienced ^Junior.
Chronicle,
Place, New York 8,
'
'
.
'
7-:;,,c.
•
Tracer
• in
over-the-counter
securities^: > Give
details.
HELP WANTED
Replies treated confidentially.
P. O
Box 26, Trinity
Established investment dealer
seeks
TRADER
Address Box 40
Wanted
New York,
Station
AVAURLE
N. Y.
qualified to build
and manage a retail sales
organization in the Near York a man.
metropolitan
The man
we
seek would naturally be
presently actively engaged in
retail securities selling.
He
must
possess
qualities
of
leadership and personal pro¬
ductive ability which will in¬
spire others.
We are pre¬
pared to cooperate in every
way with the man who quali¬
fies for this position and the
area.
high caliber.
Box
FC
Commercial
ence
(Female)
Fifteen
years thorough; and. varied Walt
St. experience. Excellent secretarial back¬
ground. Christian. Well educated. Salary
Box
C
Chronicle,
8, N. Y.
25
years
Mar-!
of age—pres4
Box JC-19»
Financial
&
25
Chronicle,
Park
Place,
New York 8, N. Y.
j
.
Psychologist
FinancialChronicle,25Park
Place* New York 8, N. Y*
Industrial
ried, 39
Commercial
Securities Trader
Experienced in aptitude test de¬
velopment, desires position with
industrial organization.
Address
&
and.
Stock Issues.
ently employed.
Commercial
&
Financial
Park Place,
New
York
106,
Rail
in
Bond &
spen.
Address replies
116
Trader with 17 years' experi¬
Assistant Trader
facilities and services we of•
fer should attract salesmen of
H< E. Krugman, 33$ W. 86th
20
years
Street
C
St.,
and
Well
acquainted
Out-of-Town
Trust
Park Place# New York 8, N. Y.
-
SECURITY ANALYST
Manager For
^7
-
'
-ii
K.
'
NEW YORK OFFICE
-«
7;
\
^
r,
.
i
%
-
-
.
•'
•
>
•
•'
7'•
7/.7">
<r.r*v
will be available as
Successful Philadelphia.- In¬
vestment, ( firm
handling un¬
listed Securities- seeks
managed
,
fice.
'
This
erated
office#
on
*
a
MANAGER of STATISTICAL DEPARTMENT
New York of•
now
777:
being
and
:7,7
MARKET LEnER WRITER
op¬
prof itable basis#
~
1
requires
a
man
some
re¬
to
as ales
handle
investment
a
organiza¬
general line
7
''*l'"
c.
^ ^
5
k
J'
IJ(
UNDERVALUED SECURITIES
^
:
V''77j '
7" * I
.
'V.i
<
\4 %"
•;>
X,
securities. 7;
CERTIFIED PUBLIC ACCOUNTANT
Write in strict confidence,
Box 7 JJ15
■*>
Specializes in f^reting out and concise reporting on
production ;and 'the abil¬
tion
of
with
^ V *
qualifications
Financial.: Chronicle,
25
5.T*-.V-"
to
and
Commercial
.
Place# New.,York 8, N. Y*
Park.
.
..'i .•:7.-/;'mV7 •»'.* *•
-•£
*•
T'v
^i^
Box No. W 17,
7
-
'7-;'-17^-
^- 7*7
.
7
•''~K
Ji\
\-
\
V-
'
^
<
V;V*V.r
•'7.7-
Commercial &1 Financial Chronicle
25 Park
Deal¬
Experience.
Box
117, Commercial & Financial Chronicle,
25
New York 24, N. Y.
Wall Street:
Personnel
Investment
ers.
Investment Firm Seeks
outlining
NEW YORK DOCK CO.-on Dec. 5 fijed a
Graham
Company, Mer¬
par).
27,000
•:
A.
to
partnership with William A. Mid¬
Rreen,7 New
Y,
June 24
„
ity ; to .build
shares
new
as
Over-the-Counter
Offering—21,521 shares offered first in
exchange for 6% 25-year sinking fund de¬
bentures on basis of one share preferred
for,. -J$100 7 of
debentures,
^unexchanged
through underwriters at $101.50 per share;
additional (5,479) ^shares, to -be offered to
public at $101.50 per share.
to
the
the
for¬
New Middendorf Partner
by
prospectus.
(no
Texas,
of
Exchange,
individual dealer.
an
Details—See issue of Dec. 20.
the; opportunity
share
dis¬
any
member
Stock
Potter, is,
additional
statement
stock
VIRGINIA RED
.
St
Dec. 10
for
without
29.
York
crease
Louis, Mo.
SOUTHERN UNION GAS CO.
$100
merly proprietor of Stephenson &
common
...
Pittsburgh,
at
Stephenson,
Details—See Issue of Aug. 16.
Offeringt-The price to the public i»
$12.50 per share.
Underwrlters-r-The underwriter is Gil*
series
ranges
from 99 to 102
average price to the public is giver
1Q0.47.
"
Underwriters—S. K. Cunninghamv luo,
stock
Now Individual Dealer
F.
Co.
com¬
shares
The
as
common
underwriter.
an
Nov.
Underwriter
filed
Details—See issue of July 19.
Offering—The price to the public of the
different
shares!'
preferred
commission.
or
in Middendorf &
certifi¬
trust
second
25.
investment
i
registration
shares
George F*
York, is named underwriter,5
cates.
tail
Underwriters—Clement
;-details—See
filed
£
i
29. at the rate of two shares
f CINCINNATI,
and
&
New
list
;
ROBERTS TOWING COMPANY on Julj
a registration statement for
$500,serial
Jan.
count
stock which is presently issued and
outstanding; and application has been made
11 filed
$7
shares
basis, plus a cash
Unexchanged
shares
through
payment.
underwriters-at
mortgage
Weld
Application has been
VALLEY
of
shares for
ior
$5
21,695
preferred
their
share
is
company
4.624
stock
cumulative
exchange
for
pended now pending before the SEC.
con¬
Details—See, issue of Nov. 22.
holders
Webster
Exchange 350,000 shares of its
Stop Order Hearings—Stop order hear¬
ings to determine whether the effectiveness
for established
on
registration, statement for
a
shares
preferred
&
;
-
filed
(par
3.
White,
21
offered
the
to
share for each 10
Subscription- fights
Jan. 26, 1946. -Any shares
;
Underwriters—Laird, 7 Bissell
. Meeds,
Spencer Trask & Co. and Merrill Lynch,
Pierce, Fenner,.& Beane head underwriting
16
Jan.
500,000
per
shares
000
23
20,392.8 f
«
Navajo Corp. has agreed
to purchase all of the unsubscribed shares 4
mon
underwrite
should
Nov.
on
for
stock, par $100.
preferred for each 15 shares of
held, at $100 per share.
Rights
common
Offering—The price to the public is $4.50
Details—See issue of June 7.
registration 'statement
of
Stone
—
Details—See issue
V-
"
of;
Co.,
second
expire
statement
stock, par 10 cents, of which 150,000 share?
are
Curb
Principal
CO.
statement
offered to the holders of
6f record Dec.
underwriting group.
statement
OIL CO. on May 31 filed a
for 990,793 shares
—
cent*
Jk
•
JUICE
GRAPE
registration
a
Offerings—The
are
;^777.: (777:7;;77;-7:7"77i7:777:7:i::^7'; 7... ■
I UNITED STATES AIR CONDITIONING
statement
Underwriters
Burnside
7 Details—See issue of Nov. 29.
at
stock.
stock
common
7.•
7,
WELCH
•
e\{
'
issue
Inc.,
the
Bennett & Co., Inc., Dallas. Texas.
subscribed for by common stockholders
a
Blodget,
head
CORP.
J'
of
53
funds.
States
shares of second preferred
Offering—The offering price to the pub¬
lic will be filed by amendment.
in
jf common stock, (par $1).
v
will < be offered to the public.
on
*'
shares
2.
or
^ h
stockholders at $100 in
held,
cominon
expire at
Nov.
•«-.
registration
a
of one preferred
ratip
shares
not
v.-
-
812,100
Underwriters
Offering—The offering is to be at par,
with tptal net proceeds to the
'corporation
placed at $900,000;
A
7 7
Underwriters—No underwriter named;
'.'I"*
filed
Aug.
Canadian
,
Details—See issue of; Jan. 3.
Pir
21
7 Details—See
20 filed
$900,000
cents
York..
filed
Of the total, 23e,000 shares will be
purchased from the company
by the under¬
writers, while 574,100 shares will be pur¬
chased from certain stockholders.
writers,777(.;;:;;7;7!'7v.777:/777v.'77t(7;r.7(7.7>:
a
The
preferred is
time into iy2 shares of
Dec.
&
the
$5).
f
are
New
pre¬
to
TENNESSEE GAS & TRANSMISSION CO.
issue of Jan. 3.
■
'•
' ' '
Offering—The price to the public will be
filed by amendment.
- '
'
Co..
of
offered first
common
on
Details—See
&
United
of
21 filed a registration statement
15,000 shares of cumulative preferred
stock, convertible series, $100 par value.
60
•
be
to
are
any
INC.,
for
Schwabacher
is
Underwriters—Willis E.
ferred.
Dec.
on
150,000 shares of com¬
....
.-7 v
Underwriters—Burr & Co., Inc., 57 Wil¬
liam Street; New York 5, N, Y,
7,7777
-
AGGREGATES,
par).
of
issue
Offering—The offering price to the pub¬
cumulative convertible pre¬
which,
1945.';7C^;7-7"7
Alstyne,
;
ferred stock,' $100 patt*
Details—See issue of Jan. 3.
30,000
are
5,000
offered to stockholders oLrecord
are
7
a
registration statement .for. 58,386 shares of
common stock, par $1.
77'
43,386 shares at «a price to be
amendment. 7 In
addition there
.
Offering-r-Of- the- 14,999; shares
group.
on
14,999
stated
7 ^7-3
statement for
stock, minimum
capital
7
Dec.
on
of
offered to
Underwriters—None named.7v.777;:;
( BUFFALO BOLT CO.
it
Offering—The preferred shares are being
(Offering—Company has an authorized
capital of $40,000, divided into.8,000 shares
(par
$5).
There have been issued for
property, 2,000 shares, in escrow; issued
for. cash 280 shares and in treasury 5,720
shares which are being offered at par for
public
public
registration
a
shares
Jan.
,
11.
the
to
4.
the
-
$50 per share.
'
Details—See issue of Dec. 20.
ING
Offering—The
Sept
on
Finance Co„, At¬
lanta, Ga., is fiscal agent.
value
of Oct.
will
Underwriters—General
filed
Details—See issue
CORP.
Oct.
price
$7.50 per share.
shares
;
public
statement for 200»stock, par $5.7
GRAHAM-NEWMAN
preferred hon^-voting shares,.
are
•:
.
Details—See
lic
holders of the company's
outstanding com¬
mon shares at
$10 a share.,. The cominon
shares are reserved for conversion of
Dec.
o'
W
SECURITIES
Details—See
I
statement for 400,000 shares of 4% cumul¬
securities
k
and
($1
Details—See issue of Dec. 20.
Offering—The
100,000
shares
;
1.
the
to
28 filed a registration
000 shares of common
We
present below a list of Issues
(whose registration statements were filed
twenty days or more ago, but whose
offering dates have not been deter¬
mined or are-unknown to us.
conversion
upon
issue of Nov.
derwriting group.
7
'The
($8 par)
ferred stock
v'.;-*
The 160,000 shares of com¬
and outstanding a]ad
be filed by amendment.
Underwriters—Burr 3c Co. heads the un¬
*
DATES OP OFFERING
-7.7-
■
.
issued
is
Details—See
Registration Statement No. 2-6097. Form
ative
29,71945.,
being sold by certain stockholder^.
Co.;
8,-1. (1-14-46).
-
12 filed
convertible preferred
pre¬
registered includes 100,000 shares
preferred.
mon
Hawley,
f
Underwriters—None.
cumulative
stock
mon
offered by the corporation.
Registration Statement withdrawn
Dec.
on
registration statement for 100,000 shares
stock
being
and
The
par,
reserved
;
>
Miller
a
of 55 cent
^7^*7-7
29.
v
on
—j-the dividend rate to be filed by amend¬
ferred,
issue of Nov.
held,
a
ment—indeterminate
STERLING ENGINE CO.
-
,
filed a registration statement
shares of capital stock, par $10.
providing for interest at the rate of
payable only from income,
ENGINEERING
registration statement for
30,000 shares of convertible preferred, stock
has filed
CQ.
7
CORP.
January at $10 per share in the
ratio' of one share for each four( shares
in
Underwriters—None mentioned.
;■
Co.,
Jan.
..
-
investment.
'Proceeds—For
Hemphill,
CONSOLIDATED
12 filed
dis¬
a
&
BATTERY
Underwriters—Blyth
(
asset
tribution charge.
Stone
Offering—The price to the public is $10
Jersey
•Business—Mutual investment company, -i
(Offering—At
and
underwriting group.
?
J. J<: *
N.
Hayden,
23
Details—See
,
;
..
by
CADMIUM
for 35,000
;
v
7 y■ :-;77
V:4"
Dec. 14 filed a reg¬
on
Nov.
on
principal' underwriter-,',c
■■;'•"■7s77,.'1l|.;'7 iV'Y:
.-■**>■■
:Of f ering-^Afe?,market.
headed
'NICKEL
■
.
be
.
867,205 shares of beneficial interest.Address—Congress
Street,
Boston,.
Mass.''- •'/'
will
LTD.,, on Nov. 13 filed a registration state¬ riand Halsey, Stuart & Co., Inc.
,-'7
ment for 1,000,000-shares of common; stock,, :$ Registration Statement withdrawn
8, .1946777:77'7;;-,.:;7.7 7; 7(7
par $l'7\K7,.;>, -r v
Details—See issue of Nov, 22
77;:-..-:
(1-14-46)..:['■>
MASSACHUSETTS
MINES,
GOLD
YELLOWKNIFE
CABOT
Registration Statement No. 2-6094.' Form
8-1..
287
Place, New York 8, N. Y,
THE COMMERCIAL & FINANCIAL CHRONICLE
288
Ratification
British Await U. S. Loan
■
(Continued from page 244)
here are realistic enough, howto jknow that the fact that
concessions were made on
ever,
these
strength of that argument does
not in any way bind Congress.
Some newspaper: reports from
the
proportion of the
have i voted
ratification.' Indeed, the
Party and a fain
Party
Labor
Against,
chances
,
.would
that
are
the
House • of
would have risked
Lords
stitutional crisis;by
con¬
a
rejecting1 tte
Agreement.
Should it bo found
Washington
already indicated that, after all, this country is ex¬
pected
''to
relinquish
Imperial
some of the amendments that are
Preference' without the certainty
likely to be proposed in Congress.
6f a quid pro quo, the. Govern¬
They relate to the securing of the
ment would be confronted with a
loan by Britain's remaining in¬
vestments
abroad, and similar thoroughly hostile Parliament.
:
British
public
opinion, too,
terms
of a financial character.
Nothing is known on this side so might assert itself for -the first
.about
far
possible:^amend¬
any
political ' character.
it is -considered possibler ^nd
of
ments
But
a
probable, that some;
amendments would be put
even
suqh;
for¬
controversy. •
The
Englishman
does not
yealize, that ; in -existing - eircum-
this
in
time
average
Sterling Area arrange¬
stances the
has
which
ment,
been
already
unconditionally, is a
ward in due course.
In the first place, the possibility muchmore ; important ^factor in
■that 5Congress vhiight insist ort m inter ^Imperial trade thaii the Otr
definite commitment about the tawa Agreement. The working of
elimination of Imperial, Prefer-, the Sterling, Area system is iar
beyond the Understanding of the
ence even before, the coming trade
(This explains the ease
conference is envisaged in some layman.
given away
.
quarters here. This view is based
on the assumption that Congress,
while very keen on the elimina¬
tion of the Ottawa System, is ut¬
terly reluctant to agree to a really
drastic:redaction of the American
wall, and would like to
strengthen the bargaining posi¬
Administration at the
conference.
Any such attempt
would meet with the utmost re¬
sistance on this side.
Parliament
had : approved
the Washington
Agreement largely on the em¬
phatic assurance given by the
Government jthat it contained no
definite commitment, On Imperial
tariff
tion of the
Preference,. and that any conces-r
sions in that sphere, would only be
made in return for
equivalent
the United States
of tariff reductions.
concessions by
the
in
form
practically
Conservative
But for this assurance,
Ithe
of
whole
the
with which Mr. Dalton and Lord
Keynes got away in Parliament
with the argument that all that
was happening was that the Ster¬
ling Area is restored to what it
was; before the war.
Few people
realize that the prewar form of
the system is quite useless in post¬
war
conditions.)
On the other
hand, the Ottawa system has come
to-be regarded as being one of the
basic conditions of the mainte¬
nance of the Empire.
Should the
House
of
Lords
been
even
the view that, if the
is
to
sug¬
most extreme supporters of
'the Agreement, it is felt it would
nPt
have been unreasonable to
adopt
United States
grant such a large loan it
have
the
assurance.. that
must
make the British ratification
con¬
the end of January.
that the subservience implied by
unilateral ratification can only
by a Socialist Government.
Such speculation should of course
run
be vdismissed
as
wishful
mere;
thinking. Any such attempt vfauld
be resisted by the Government
and its majority in the House of
Commons.
It is doubtful whether
Conservatives
many
such
come
this
wel¬
with
would
interference
an
country's
politics.
Nevertheless, the fact that the
possibility is envisaged at all is
worth recording as an indication
pf.- thel state of mind in, which
British political opinion is during
the interval between the ratifica¬
tion of the Agreement in London
and in Washington. t
- r
One thing that is felt Widely is
that
it
was
big
a
mistake—pos¬
sibly, the biggest mistake of all—
on the part of the British nego¬
tiators not to have insisted
ing
fix?
time limit for the ratifica¬
a
of
the
Agreement
Gaumont-British **Xn ;■
;
Bendix
Helicopter
Majestic Radio
Moreover, for obvious reasons, the
longer the deliberations of Con-!
gress are dragged out the weaker
Britain's position will J#e in re¬
sisting; demands for further con¬
U. S.
Finishing
Corp,
Mexican
Cinema "B"
cessions.
By the time Parliament
reas-
M.S. Wien&Co.
index
■
Bank
"•(; ESTABLISHED 1919
Page
Stocks........ 256
Insurance
and
Broker-Dealer
Personnel
Members N.
40
y.
Security Dealers Ass'n
Exchange PI,, N. Y. 5
Items...... 285
Teletvne
HA. 2-8760
'
Y.. 1-1397
N.
■>
Man's Bookshelf
256
Calendar of New Security Flotations 286
Business
Canadian Securities .............., 260
- Broker
Investment Recom¬
A
Dealer
mendations
;.., 258
Monolith Portland Midwest
250
..................
....
CEMENT COMPANY
250
and Notes......... 280
Funds
Notes
NSTA
Literature:......
and
News
Municipal
Mutual
&% pfd.
Our
Reporter on Governments..... 265
Our Reporter's Report...
259
Public Utility Securities
248
S10
—
par
Dividends: 20d to 1944 >hd
.....
Railroad
Real
Securities
Securities.
Estate
Securities
Salesman's
Tomorrow's
Con¬
by
observers,
Comer
254
1945:
253
1946 —$12.80
arrears
of Jan, 2,
as
262
Markets—Walter Whyte
Says
Present market 8
;
-
8%
269
Considering the "indecent
gress.
haste"
<
with
rushed
was
on
political
by
it is pregnant with
breed contempt on the other side.
internal
„
.The situation is watched
Nffw~Enf!aird PabJtrService
It is felt
say,
perhaps
possibilities
of grave conflicts and crises.
V
.
tion Government instead of being
tion
as
ditional upon the American, ratifi¬
cation having been effected by,
Britain would return to the Coali-
whieh
the
through
Michigan and
measure
Parliament
curities
Connecticut
Sections
on
page
Se¬
RALPH F. CARR & CO.
252.;
BOSTON
;
Trading Markets in
,
9, MASS.
Bonton
New York
Hubbard $442
Hanoeer 2-7913
T«tetrp«
BS 32i
■
:
.
Amalgamated Sugar
Globe Aircraft
Artcraft Mfg. Com. & Pfd.
Int'I Resist 6% Pfd^ & Com.
Baltimore Porcelain Steel
Ironrite Ironer Com. & Pfd.
Bendix
Helicopter
Lear Inc.
Bendix
HomeAppliances
Majestic Radio & Television
We specialize in
possible that Congress might
as a condition of. the ratifi¬
cation of the loan agreement, that
insist,
should abstain
nationalizations; In
Government
all
Insurance and Bank Stocks
Industrial Issues
*
ered
the
has
gested that Congress might
quarters it is consid¬
from further
misgivings among - all but
grave
Jan. 22 it will
on
possible, to; see more clearly
what attitude Congress is likely
carefully
ty to seek mandate for the aboli¬
tion of the Upper Chamber.
some
be
to take.
would hot dare to go to the coun¬
in
sembles
servatives it
that. issue it
on
by the end of December with the
aid of methods that have aroused
private conversations almong Qotir .the.
the
in
defeated
be
Government
Thursday^ January 17, 1946
*
Investment Trust Issues
Clyde. Porcelain Steel
Telecom
Pu Mont Laboratories
WUcox & Gay
Public Utility Stocks and Bonds
TEXTILE SECURITIES
Corporation
Securities with
a
New Eng. Markel
Frederick C. Adams &Co,
mk
--
ForeignSec urities
45
New
NASSAU
TELEPHONE
MARKETS
York
Security
24 FEDERAL
PHILADELPHIA
REctor 2-3600
Dealers
Established In 1922
Association
NEW
YORK
BELL TELETYPE
TELEPHOxVE
Enterprise 601.1
new.
yorr 1-576
V.
J
^
•*.-
*'r
•'»
/
;s V •:RV• 1 -fi
-
7
^
''"
ft
1-971
FOREIGN SECURITIES
Telephone
50 Broad Street
i:y-+
•
HAnover
AFFILIATE: CARL MARKS
2-OOSO
:'7\;'.-V
•
,
if- -
-W V:
:
%
S'xy
'
"•
y,'
^
U. S. FINISHING
Hon Rose STrqster.
POLLAK MFG. CO.
established
-
»
'
\
Bought—Sold—Quoted
& CO. Inc. CHICAGO
NEW-ENGLAND";y;:
1914
Specialists in Soft Drink Stocks
EXTILES
New
9*
/
New York 4, N.Y.
•
BliDA
Red Rock Bottlers, Inc.
SPECIALISTS
|
< V
Trading Markets in
Teletype
NY
Tele. BOston 22
5
.
i
STREET, BOSTON 10
Tel. HANcock 8715
STREET,
■
New England Unlisted Securities
INCORPORATED
Members
Specialists in
.
Kobbe, Gearhart & Company
74
Teleph#ne:1t()wllng Green 947400
England Lbcal Securities
MAR.-TEX.
Trinity Place, New York 6. N. Y.
Teletype: NY 1-375
TYBOR STORES
WALTEK .1. ( O.WOI LY & CO.
INCORPORATED
24 FEDERAL
1923
Specializing in Unlisted Securities
STREET, BOSTON 10, MASS.
Telephone Hubbard 3790
Bell System Teletype BS-123
•
BANK ^ INSURANCE
148
Northern
P0BUC UTILITY
Engineering
1»-
Net
'
•
v-:.
'■
:
-
per
share.,
5. Average earnings 5
W. T. BONN & CO.
Broadway "
yrs.
—
SOiD— QUOTED
:
Telephone
:
Teletype B8 259
HAnover
2-7914
Susquehanna
bank
*
Mills
about $3.
loans.
REMER, MITCHELL S REITZEL, INC.
7, A low-priced stock to yield
about 5%,
'
208 So. La Salle
\
St., Chicago 4
.
Prospectus on Request
RANdolph 3736
Special Report Available Upon Request
New York 5
Bell Teletype NY 1-886
BOUGHT
4. Current yearly dividend $1.00.
No
Telephone COrtlandt 7-0744
W:
I
liabilities.
$,• No bonds. :No* preferred stock.
|
Y,
BONDS, PREFERRED AND COMMON STOCKS
current assets $13.56 per sb.
3. Current assets 4.35 times current
r
1-;; Reiter-Foster Oil
120
;State^ 31*» Boston 9, Mass.
CAP. 0425
LUMBER & TIMBER
2. Net boob: value $20.63
Pressurelube, Inc.
:
Tal.
Founded 1897
.
Sunshine Consolidated
U.S.Radiator,Pfd.
REAL ESTATE
N.
Works
San-Nap-Pak
^- INDUSTRIAL
WESTERN UNION
Amos Treat a Co.
40 Wall
St.'; v sjkNew 'York 5, N. Y.
BOwling Green 9-4613
■teleprinter;:;'
"wux"
BELL
SYSTEM TELETYPE
Hill, Thompson & Co., Inc
Markets
120
and Situations for
Dealers
Broadway, New York 5
Tel. REctor 2-2020
Tele. NY 1-
@FedFRASER