Full text of Commercial and Financial Chronicle : July 17, 1958, Vol. 188, No. 5760

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ESTABLISHED

1S39
li N 1 V

t

R S IT Y.■

MICHIGAN

UL 13 1S&3
SIN ESS

ADMINISTRATION!

™

UBf<ARi

Reg. U. S. Pat. Office

Volume 183

Number 5760

New York

EDITORIAL

Alaska Development

It

would

business

appear

in this

men

reconciled

to

that a great many practical
country have become largely

more

a

or

less

continuous

financial

and

statisticians

for

make

the

of

that from time to time

the Federal Reserve authorities let it be known

that

of the inflationary aspects
of much of what is going on, and now and then
some
of the members of the official family in
Washington have something to say about the im¬
portance of avoiding this kind of inflation.

,

they

All

are

aware

this, however, often

headed business

men

seems

unimpressed

today is
as

all events

great
if not all of the anti-depression measures
official favor and the techniques proposed to

I

mm

tH

implement the "full employment act" are essen¬
tially inflationary in their nature. That this is
{''-the real nature of these programs is often ap¬
t

to

went

and

but minerals of various
stead
F.

B.

DEALERS

as

Heintzleman

The

economy"; criticizes Keynes' misconception of
capital; and
illusions held regarding cheap money and

recounts

inflationary credit, unemployment benefits, public
works, and other remedies.

PARIS, France

tracting periodically in cycles, each
lasting between eight and 11 years.

a

In the United

States, whose economic
in¬
termittent cycles, commonly called
recessions
lasting on an
average
about four and a half years. Between

life is particularly intense, we see

1946

points of which were reached in 194,9
and
1954.
The
beginning of 1957
seems to have marked the end of a

fea¬
to

of expansion having lasted
the beginning of
depression reminiscent of ;
Mentor Bouniatian
the prewar crises.
What are the causes of this cycle in economic activity

period

about 11 years and

pectors' trails and in general of helping to smooth the
way fqr
a well rounded permanent development
by

Continued

on

page

a

20

with its crises and
address

28

Michael

ernor

NOW IN

afforded

Mr. Heintzleman at a luncheon honoring
Stepovich, New York City, July 1, 1958.

by
A.

1954, following the second

spectively, the United States went
through /two
recessions,
the
low

home¬

extended

and

World War and the Korean War re¬

laying out of townsites, the con¬
of road systems and pros¬

the

The economic life of industrialized

—

countries is subject to fluctuations, expanding and con¬

sorts, water

also

work

He subscribes to President Eisen¬

discount rate and confusion of money with

struction

♦An

are

the free

subse-

recreational

and

lands

tures.

became known as Ngw Dealism, asserted
proposals of an orthodox sort then heard
would succeed in preventing inflation only at the

SECURITIES

1918

the

industrial sites,

sites,

power

later

securities

of

course.

ft with inventorying and fostering the

that

page

sion's normal

hower's declaration of "faith in the inherent vitality of

development of the resources of the
20,000,000 acres of National Forest
land of which I had charge.
These
resources
included not only timber

].many in public office at least by implication
; when
they revive the old, old cry about price con¬
trols designed to prevent these programs from
having their natural effect. An economist some
years ago, who was much inclined toward what

on

in

most

product utility resulting from produc¬

and suggests tax reduction in depressed
industries and allowing no other interruptions in reces¬
tivity gains;

<luent y^'s was chiefly concerned

m

f

parently admitted by academic commentators and

Continued

Alaska
for

deeper

recessions?

Gov¬

The answer has been the
Continued on page 28

REGISTRATION—Underwriters, dealers and investors in corporate

a

complete picture of issues now

tial undertakings in our "Securities

registered with the SEC and poten¬

in Registration" Section, starting on page

State, Municipal

34.

in

and

U. S. Government,

—

m—

UNDERWRITERS

Stale and

Municipal

BROKERS

STATE

DEALERS

Securities
telephone:

and

and

BONDS

RAILROAD

CHEMICAL

PUBLIC

CORN EXCHANGE

30 BROAD ST.,

FIELD REPORT

ON

THE FIRST NATIONAL CITY

MEMBERS NEW YORK AND

15 BROAD STREET, NEW

•

Dl 4-1400

Members

Teletype: NY 1-708

To

Active

Dealers,

Markets

Banks

t. l.WATSON & CO.
'

x''

'v
•

"

'

/

1832

ESTABLISHED

;

■

'

Members
New York Stock

fl

American

Stock

Brokers

FIRST




Executed On Ail

Canadian Exchanges

CANADIAN

Exchange

STREET

<Sw^hlV€4t COMPANY
DALLAS

Commission Orders

DIRECT

WIRES TO

MONTREAL AND TORONTO

Goodbody & Co.
MEMBERS NEW YORK STOCK EXCHANGE

BRIDGEPORT

•

PERTH AMBOY

Stock

115 BROADWAY
NEW YORK

Exchange

1 NORTH LA SALLE ST-

CHICAGO

Chase Manhattan
BANK

YORK 6

$250,000

Guaranteeing Quebec Hydro-Electric
Commission

3/4% Debentures
Due February 1,

for

California

Municipals

1983

Payable in United States Dollars
Price 96.88 to yield 3.95%

DEPARTMENT

Teletype NY 1-2270

25 BROAD

•*

CANADIAN

the

PROVINCE OF QUEBEC

SECURITIES

Exchange

NEW YORK 4, N. Y.

York

DEPARTMENT

35 offices from coast to ooast

Maintained

and

Dealer

>

New

120 BROADWAY, NEW
Bond Dept.

TELETYPE NY I-22S2

Net

■

REQUEST

Harris, Upham & cq

AMERICAN STOCK EXCHANOES

YORK 5, N.Y.

Distributor

•

RANK

OF NEW YORK

Burnham and Company

N.Y.

BOND

ARE NOW AVAILABLE

SECURITIES

CABLE: COBOBNMAM

Underwriter

Bonds and Notes

UTILITY

BANK
DEPARTMENT

Public Housing Agency

LATEST

FOREIGN

&

BOND

MUNICIPAL
COPIES OF OUR

INDUSTRIAL

HAnover 2-3700

Municipal Bond
Department

Doximox Securities
Grporaxioti
Associate Member ol American Stock

40

V

economic

same

in line with lower

Pacific

forester

>

n

policy to follow which, he
says, was rejected in December, 1932, with catastrophic
effects to us; favors but finds impractical cutting wages

same stage of
Northwest passed through
75 years ago but has recently begun
to
grow
at a rate/ which is now
fairly rapid and offers promise of
increasing.

many

in

tian reoffers

in approximately the

the

unconvinced. To them it is obvious that a

■

economist, whose
half century, discursifies
and examines the effect of government measures usually
taken or recommended to fight a recession. Dr. Bounia-

banks'
Alaska

development

to leave hardor at

'

Distinguished internationally known

Alaska of the Pacific Northwest Trade Association

Alaska, now that recently ac¬
quired statehood promises far more effective resource
development and brings with it land grant larger in size
than California, are glowingly described by former Gov¬
ernor.
Mr. Heintzleman answers such myths as Alaska
being a land of ice and snow; briefs prospects in
petroleum, forest industries, minerals, hydro-power, coal,
commercial fishing, transportation and agriculture similar
to that in Scandinavia and Siberia; refers to surging
growth in bordering Canadian northwest sections aided
by Canadian Government, and hopes that with the help of
proper inducements year-round enterprises will move in
and offset present predominately seasonal activities.

plans of business organizations. It is implicit, so
it seems to us, in the behavior of the stock mar¬
ket, in the face of historically very high stock
course,

Regional Vice-President for

\

Growth opportunities in

managements. We find it in many of the

prices. It is true, of

By DR. MENTOR BOUNIATIAN

Specialist in Business Cycles, Paris, France

business cycle writings span a

infla¬

use

..

V

Copy

Recessions and Remedies

Former Governor of Alaska

.

tionary trend of prices throughout the years that
lie a head. We repeatedly see some such under¬
lying notion in the "projections" that business
their

a

By B. FRANK HEINTZLEMAN *

We S
It

As

-

Price 50 Cents

7r«N. Y., Thursday, July 17, 1958

Exch.

Exchange Place, New York 5, N. Y.

Tel. WHitehali 4-8161

Tele. NY 1-702-3

T7i& Commercial and Financial Chronicle

2

.

.

.

(198)

For Banks,

The

Brokers, Dealers only

When time is

help

can

for favoring

(The articles contained in this forum
are

reach the
you need—

they to be regarded,

GORDON

faster.

A nationwide

reasons

D.

as an

there

GREGORY

Manager, Bank Stock Department
Swift, Henke & Co., Chicago, 111.

private wire

system, plus a wide range
contacts, assure you of

First National Bank of

Having

Chicago

getting the complete cover¬
age you need in your Overthe-Counter problems.

specialized

stocks for
natural

that

would

I

have

a

Chicago

fa¬

rity

I

Corporation
Established

National

1920

120 Broadway, New York

BOSTON

Private

Principal Cities

to

Wires

tell

to

D.

Gregory

SCRIP

&

$125,000,000

Stock

American

15,

the largest

in the country

operating

This

growth is

within

no

as

con¬

solidations have taken place dur¬
The

Exchange
Exchange

Stock

July

on

ing this period.

Members
York

from

bank in the Middle West and the

entirely from

New

increased

have

without branches.

McDonnell & Co.

have * proven

records

increase

which

banks

the

that

their cap¬

title

TEL. REctor 2-7815

tive

at

of additional stock. First National

LAMBORN & CO., Inc.
99

WALL

by

—

Refined

—

outstanding

exam¬

Capital stock was increased
stock dividends of 66%% in

"The

at

Best

time

given
should

have

certain

Liquid

Exports—Imports—Futures

a

stockholder

$.34.00

over

will

in

shares

in

sold

with

and

on

receiving

each share held

Previous

1943.

dividend

be

share^in annual

per

cash dividends

DIgby 4-272l7

to

the

stock

First National
below $200.00
each

1943,

the

current

market

of

since
came

Edward

added

are

Direct wires to

stocks to

JAPANESE
STOCKS

bonds as

For current information

as

a

materialize..

of

Earnings in the industry are de¬
pressed but indications are that
change in the underwriting cycle
is
near.
This could easily mean

York, In*.

New

Affiliate

of

Yamaichi

Securities Co., Ltd.
Tokyo, Japan

«.

Brokers

Investment

&

111 Broadway, II. Y.

Bankers

6 COrtlandt 1-569#

uptrend in underwriting earn¬

income

increased

MONROE AUTO

EQUIPMENT
\

from

to

Com. & Pfd.

$8,306,000 in 1957.
American

mmi
Harold J. Silver

both

classic

the

characteristics

and

as

practical
Insurance

industry

as a

whole (and for

Insurance

Company

BOUGHT

SOLD

♦

Insurance

Company
condition dur¬
ing 1958 along with the industry
generally; and in addition, con¬
sideration must be given to the
following specific items:

—

should improve its

MQRELAND & CO*
n.

company is applying
selective
underwriting

The

(a)
more

standards

with respect

to certain

Stock

Detroit1 Stock

(b) Very substantial progress is
being made by the Company in
the integration of its operations.
A large amount of nonrecurring
expense incident to the foregoing

-

V, \tv

'

Exchange
Exchange

1051 Penobscot

Building

DETROIT 26, MICH.
WOodward 2-3855

lines.

was

Members

Midwest
<

foregoing

will be evident.

Premiums written by the insur¬
American

Yamaichi

share in the potential

the

viewpoint.
American
Company has all the

ance

write

or

Securities Company

$3,157,000 in 1948 to $5,886,000 in
1952
to
$8,233,000 in 1956 and

ity characteristics

well

operating profit of the insurance
company, which must eventually

vestment

industry

from

permit the investor in effect to
an equity in a diversified
portfolio that is income producing

acquire

expansion of investment income.
American Insurance Company in¬

com¬

pared
same

Call

tangible values behind
are great and

The

plus side, dividends would be in¬
creased justified by the persistent

(a) be in an
industry
that
has
growth
potential
(b)
be
relatively

in

branch offices

ings. It would appear that once
underwriting results are on the

acteristics, viz;

cheap

our

of

by these

Branch

■

-

Office—Bay

City,

•

DE 75

Mich.

.

absorbed in 1957.

(c) The Company has followed
wise investment policy and dur¬

in dollar values due to the infla¬

a

tionary trend.

ing

single year in the long his¬
tory of this business. Virtually all

1957
increased
their
bond
holdings and reduced their hold¬
ings of common stocks. At the end
of
1957
bonds
comprised 6610%
and
stocks
34.0%
of
portfolio

lines

compared

The

experience of the fire and
casualty business for .1957 was the
worst

experienced

rising

loss

with 59.2%

bonds

and

stocks at the end of 1956.

The Company had a loss
forward
of
$14,500,000
lines into the jagainst future taxable income as
red. However, the laws of most of the end of 1957.
states provide for the setting of
(e) The risk diversification of
premium rates that in the aggre¬ the Company is excellent with
gate will provide a reasonable un¬ approximately 50 % being derived
derwriting profit for the industry. from fire and allied lines ancl 50%
There is always a time lag until from the casualty field.
(f) The Company is 111 years
premium catches up with losses, 1
but
and
rate
increases in the more old
is
the
twelfth
largest
important coverages appear to be stock fire and casualty company.

costs put the major

Eagle

Brown

be¬

recov¬

on

interior

to

properties with

Bank

reserves.

depreciated cost
of $20,412,647 are carried at only
$1,348,971. Other assets are also

developing.

will he glad to explain the

carried below real values. During
these years the interior reserves

automobile coverages with a sec¬
ond round of increases developing

of American
Insurance
Company with American Auto¬
mobile
Insurance
Company has
not
been
reflected in earnings.

subject

have increased very

in

This benefit

worthy

of

investigation. A

representative

to

of

those

firm

our

who

are

During

Interested.
V '

La.-Birmingham, Ala*
Mobile, Ala.

.

charged-off items to¬
gether with a part of operating
earnings each year have been

sibilities through the sale of

Options

over-the-counter

President in 1934. All

eries

The additional income pos¬

Call

the

Very
conservative
accounting
practices
have
been
followed

INSURANCE COMPANIES

and

in

market.

INVESTMENT TRUSTS

Put

common

40.8%
new stock, the appre¬ ratios; and in last year's atmos¬
ciation in value is 500% exclusive phere of inflation, increasing oper¬ j
(d)
of cash dividends. The stock is ational costs plus increasing claim carry

traded

NY 1-1557

New Orleans,

the insurance stocks

$276 for the

PENSION FUNDS

value

companies. The rise in the bond
market will help those companies
who anticipated this and shifted

an

char¬

in
1958. The $8.00 annual cash divi¬ particular) have more than kept
dend
has been paid
throughout pace with the increase in national
income. The nature of the indus¬
this
period. One share has in¬
creased to 4 1/6 shares following try is to keep pace with growth
of the country and to also increase
the latest stock dividend and by
its writings to cover the increases
retention of these stock dividends

SUGAR

:;

an

1943, 20% in 1945, 25% in 1948,
20% in 1951, 1 from 9 in 1954 and
a 25%
stock dividend on July 15,

NEW YORK 5, N. Y.

Raw

ple.

STREET

are

portfolio

stocks held

common

a

(c) have qual¬

comparison with banks which in-:
crease
capitals through the sale

read

to

any

others

shares

the

reduce

as

This
Time." A security to be particu¬
larly
attrac¬

itals regularly by means of stock
dividends
have
experienced
a

BROADWAY, NEW YORK 8

Company

Like

I

greater appreciation in the value
of their stocks over the years in

120

sharply from their

York 6, N. Y.

HAnover 2-0700

1955 highs. The stock market has
been under pressure thus serving

done.

preface I should probably

a

amend

1958. First National is

largest

Since 1917

As

Security

Deposits

RIGHTS

SILVER

J.

American Insurance
Gordon

this

of

declined

have

from

the

of

to

and Herbert V. Proch-

Manager, Corporate Department
Municipal Securities Company
Dallas, Texas
;

$582,000,000 in 1934 to $2,614,892,000
in
December
1957.
Capital
will have increased from $25,000,000

B.

James

19 Rector St., New

American Insurance Company has

institution.

Specialists in

Board

HAROLD

outstand ing
accomplish¬
ments

Eagle

been

Senior Vice-Presidents.

now,

I
be¬
timely

years,

lieve it

Edward

has

1945,

Members American Stock Exchange

kept
pace
with
the
economic
growth of the country.
Prices of stocks in the industry

the

the

SAN FRANCISCO

•

of

who

Stei ner, Rouse & Co.
Members New York Stock Exchange

to

sixth

CHICAGO

•

PHILADELPHIA

organi¬

consists
since

Corporate

complete

a

First National's official

dividend, the
during
past
15

5

Teletype NY 1-40

WOrth 4-2300

offers

banking service including a con¬
sumer credit department.

C. Kiddoo

a

stock

25%

Exchange.

National

First

Manager

Silver,

Bought—Sold—Quoted

Co.—Harold

Insurance

efficient.

most

proven

Swift, Henke

Dept., Municipal Securities Co.,
Dallas, Texas. (Page 2)

Livingston, President, Walter M.
Heymann, Executive Vice-Presi¬
dent, Gaylord A. Feeman, Jr., Guy

has

just paid

Member

Stock

J.

addition

in

Louisiana Securities

Manager

Gregory,

Co., Chicago, 111. (Page 2)

American

Forgan, Vice-Chairman, Homer J.

many

As First

years.

has

Chairman

have

of

Each

from one to

Vice-Presidents

Brown

best for

good

a

&

subordinate officers. This sys¬

to

zation

has
secu¬

liked

New York Hanseatic

Associate

D.

Bank Stock Dept.,

nor

divisions.

10

are

four

vorite and First National Bank of

been the

be,

to

is staffed with

these

tem

in
bank
it is only

30 years

over

intended

not

are

Alabama &

National Bank of Chicago—

First

offer to sell the securities discussed.)

of

American

particular security.

a

Week's

Participants and

Their Selections

Gordon

department

you

markets

OTC

participate and give their

important to

large and experi-

trading

enced

■

This
Forum

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

Try "HANSEATIC"
you, our

Security I Like Best

Thursday, July 17, 1958

these

the

stock

a

substantially.
period
in
which

dividends

have

been

During

those

creases
ance

areas
are

rates

have

Stock

on

Haw

to

paid, capital funds, excluding all
reserves,
have 'increased
from
$83,156,000 to $246,678,000. an in¬

Use

,

Options

crease

of

$163,522,000

or

almost

200%. Cash dividends of

$97,600,paid during this period
total of $261,122,000.
The
hank
pension
plan has
been in operation for about 75
years and a profit sharing plan
was started in January, 1953.
000

Filed, Schmidt & Co.
Members Put & Call Brokers
Dealers

12©Broadway, N.

&

Assn.,tnc,

Y. 5

BArclay 7-6J00




were

making

.

a

Over 50 years ago the commer¬
cial

banking
department
was
divided into divisions, and today

increased,

and the discount reduced

policies in
try

some

in¬

Fire insur¬

been

on

(g) The potential benefit of the

more

further

where

justified.

-

Ask for Booklet

1957

than 40 states permitted increases
of from 12 to 15% in the basic

term

states. The indus¬

should experience benefits
rate increases, expense re¬

merger

up

,

should start

showing

in the 1958 figures.

From

the

sophisticated

inves¬

tor's viewpoint, the foregoing re¬
view and factors outlined indicate

that

the

industry, and American
Company particularly,
duction and a probable leveling
face a brighter future. At the cur¬
off of the inflationary trend.
rent price of 25 Oyer-the-Counter
The fire and casualty company Market the stock yields 5.2% on
stocks have always been regarded its $1.30 annual dividend, and is
as
quality stocks based on their at a discount of 18% from liqui¬
price stability which has heen dating value of $30.50,,; at Dec.
high, their dividend yield which 31, 1957, and at a great discount
has been low and consistently be¬ from
present
liquidating value
low the average of all stocks, and due to the increased market value
their growth which has more than of the portfolio.
r
•**'
from

Insurance

N.Q.B.
OVER-THE-COUNTER

/

INDUSTRIAL STOCK INDEX
l$*Year Performance of

35 Industrial Stocks
FOLDER ON

REQUEST

National Quotatita Bureau
<$ Fruit Stmt

.

NewYMt 4, ILK.

Volume

188

Number

5760

.

.

.

The Commercial and Financial Chronicle

(199)

The Economics oi the Recession

INDEX

By J. II. RICIITER*

Articles and News

Chief, Department of Agriculture's European Division
Washington, D. C.
'
r
-

Experienced civil

servant and

how

works, probes the

our

economy

author provides

for

causes

disturbances and proposes a solution to end our current business lull.
Postulating that the fundamental condition for

,

general
equilibrium is "a cost value of intended investment that equals
intended savings,199 and assuming a measurable
economy,
Dr. Richter opines that the root of the recession is an insuf¬

crying need at

a

a

v

VBabj^ and Business in the

For the past ten years, with the
economic
lessons
of
the
Great

Management Ouilty

-

"

Economy at the

Depressionand

the

of

War fresh

in

have

Second

their

minds,
it

taken

for

and

st¬

have

as

1

:

.

a

,

Loughney

whenever
bid

to

accepted

do

and

job

a

economic

work

■VV

force,

to

and

6

Obsolete Securities Dept.
99

WALL STREET, NEW YORK

Telephone: WHitehall 4-6551

Economy—Stanley C. Hope__ 10

Charged?—William D. Bowden_

11

Turning Points-Ralph A. Bing_

its

have*

Firm Stand

a

Investment Bankers

as

LITHIUM CORP.

121

f

"

.

B.

Klaman__

- •

V '

.

,

'

FORT WAYNE

CORRUGATED

Free Interest Rates for FHA and VA
Mortgages

vs.

—Saul

give

14

PAPER

Where Do Drop Forgings Stand in the
Metalworking Industy?
—Walter J. CampbeSU—ii;
;

15

ALASKA OIL

The Outlook for Business and
Economic Growth
—William C. Freund
IL*

16

MacLgAN INDUSTRIES

:__4

1

'

'•

——

Banking's Trying Period—W. R. Milford

eager

improve

We

status.

we

obsolete*!

on

*

5

_

-rW. C. Jackson^■ "•

stocks

carryover

Taking

Fixed

the economy.

to

agement

ta tesmen

s

—-

I
if

previously
accumulated, transport installa¬
tions and equipment of all sorts;
and it commands an industrious,
well-trained and intelligent man¬
ery,

.

granted,

>

~

their functional contributions

economists

IS RIGHT

4

Oncoming Years—Roger W. Babson 43

The Impact of Highways on Our

and holds savings should not be made the whipping
boy and ;V
spending not be idolized, but should, instead, be judged by

World

Cobteigh—-

———-.4——

time that is most propitious„

of

State Utility—Ira U.

A Producer's View of Canadian Natural*
Gas—E. D.

explains how a multiplier effect of such an
buying power can restore V our growth trend;
contends public debt is no burden as "we owe it to
ourselves";
infusion

Garden

ASD OCOT ANY J

THE PRICE

3

Time Is Running Out in the Economic
Cold War
1 —Neil H.
Jacoby__

The writer

—now.

Cover

'

ficiency in investment and recommends that the equilibrium
gap should be closed, not by artificial stimuli to consumption,
but by investment expansion in useful
community facilities for
which there is

i

—__Cover

The Economics of the Recession—J. H.
Richter-

,

TfriSTEin

Page

Alaska Development—B. Frank
Heintzleman__

economic

our

'

-

Recessions and Remedies—Mentor
Bouniatian

description

a

3

23

.____

/

VV' V;

no

-

:•

*

■ ■

./■:"V:.'

V ~ V'-VV;VV-

EASTERN SHOEING

*

the

conten-

tion,

problem

that

of

with

international

governments

-

-

-

:
-

-

Anything

t hro
■

:
,

u

g

hout

world

ir-

are

evocably

r

currency

committed to.

the

to

is thus

long-last-',

sion

J.

fhe

of

had

Richter

H.

-

differ

and

standards

of

what

not

to

the

let

of

must

we

tions

decide

in

done

- seems

make

natural

only
Once

sure

more

that

The

.

that
want

we

we

is

devoted.

Its

economist and
-

to

which
to

general

each

produce

needed,

reasonably under¬

the

bonds

we

virtually

?

•

.

.

Sound Economy

the

world.

It

enormous

is

endowed

store

sources; it has
arsenal of

vast
i

l
♦

'v

the

form

of

of

at

with

natural

its

social

industrial

and

agri-

cultural plant, buildings, machinr>

*Ed. Note: Article contains the writer's

personal views and
cial

opinions

or

8

r

(

■

•

'

.

Bargeron

j

.

The

market's

simple:

national

__!

Teletype NY 1-1825 & 14844

40
16 V

Observations—A. Wilfred MayL

it

mar¬

Our Reporter

5

Governments^--^--——..

on

inc

40 Exchange Place, N.Y.

HA 2-9000

Direct Wires to

San Francisco

Philadelphia

Los

Chicago!

Angelot :
Daltet

25

Our Reporter's Report

-

Public Utility Securities

39
23

Railroad Securities

Capital Cities Television

21

-

Securities Now in Registration—

34

United Western Minerab
V

Prospective Security Offerings

the

output

basic
costs

Securities

are

mechanism

of

made

Salesman's Corner.-

The. Market... and.

total

the

lip of

The

1

.i

38

!____.

—

Best—„i_„i—

Security I Like

page

——

-

'

25

,

-Spencer Trask & Co.

Park

I

.

TT

'

'

Glens Falls

Worcester

COMPANY, Publisher*

2-0570

to

1

Subscription Rates

r

9576

Subscriptions

:

Thursday, July 17,
*

Possessions,
Dominion

~

'

1958

Other

-

:

•

-

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the

Chicago

must

...

(Telephone

STate

2-0618)

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S.

per

Publications

i

..

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In

New

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Direct

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J

to

fluctuations li»

of
exchange,
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foi
subscriptions
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advertisement*
made

YORK •

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INCORPORATED

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foreign

W* V. FRANKEI & CI.
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year.

Bank and Quotation Record — Monthly
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records,-corporation news,- bank clearings
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Reentered as second-class matter Febru25, 1942, at the post office at New
York, N. Y., under the Act of March 8,1879.

'

'

Chicago

.

WILLIAM DANA SEIBERT, President
1

25 BROAD ST., NEW YORK
4, N. Y.

TELETYPE NY 1-5

.

Place, New York 1, N. Y.

REctor

*■'

Yonkers Raceway

ary

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Patent Office

t

: Copyright 19S8 by William B. Dana

Company

hfrrrrt T*
HERBERT D. spirrrt riihap A Vtthiich..
SEIBERT, Editor a Publisher

Members New York Stock Exchange

TELEPHONE HAnover 24300

a

U.- S.
DANA

;

McLean Industries

44

Weekly

FINANCIAL CHRONICLE
T>ao

Commonwealth Oil \

2

Refining

The COMMERCIAL and

Reg.

17

4

26

PREFERRED STOCKS

Alaska Oil & Mineral*

19

-

r

You—By Wallace Streete—-

The State of Trade and Industry.
on

•




Mackie,

-

the incomes of those who produce

Schenectady

Singer, Bean
&

9
42

News About Banks and Bankers

WILLIAM B.

Nashville

.

v.

1

.

Washington and You

Boston

•

distribution.

policies.

have specialized in

Corp.

We

Continued

For many years we

,

•

18 •""

.

Mutual Funds

Published Twice

"

'

•

■

•

.

does not reflect offi-

Albany

British Abandonment of

on

Indication of Current Business Activity

.

is

V

Thermo King

able income to those who partici¬

•

:v

:

pate in the process of production
and

;

Elmer

Eastern Industries

-

had

that

Perkin &

0

8 ;

.____

can
go on producing
the market takes up all
the goods and services, that we
do
produce
and
distribute,
at
prices which provide a reason¬

an

disposal a'
capital in

____!__ 25

___.

44

Einzig:;"Some Second Thoughts
Disinflation"

only if

re¬

Pacific Uranium

Cover

——

pov¬

itself

produce for the

1

PubcoPet.

7

(Editorial)-—-

*

In this type of economy the
is the central command

post.

Basically, our economy is sound
and, if operated at full capacity,
one of
the most prosperous and
most securely abundant in
the

See It

Dealer-Broker Investment Recommendations

man¬

Basic

all

'

A & B

From Washington Ahead of the News—Carlisle

household

,

Common & Preferred

market
A

:

Coming Events in the Investment Field.:

,

ket..

reader.

29

■;

and

HEnderson 4-8504

•

Business Man's Bookshelf——!

erty of the subsistence system in.

argument

in terms that should
reasonably acceptable to the

standable

the

22

Bank and Insurance Stocks

a

from

us

is presented
be

In

(Boxed)——

As We

are

highly productive money
economy like ours, that has freed
;

-

diffir-K

Costs=Income=Buying Power;

to

rationale for

our

Economy's

•

Teletype: JCY 1160
19

Collins Radii

'

.

Money

Exchange PL, Jersey City

DIgby 4-4970

Economic Affairs

Regular Features

well-being:

and

1
•

Better Business Prospects Seen
by Cleveland Trust Co._______

they funda¬

labor

Banking Recession's Bulwark

Let Us Save Ourselves!

Equation:

policy action is sound. It is to
such rethinking that the present
article

18

^

industrial installa¬
carryover stocks,
and

and

City Stock Exch.
Spokane Stock Exchange
;

C.'Douglas Dillon Named Under-Secretary for

and

trendline of substantial growth,

it

of

economic

well-trained

agement..

order

slip from

economy

short

of

transport
of

a

hesitate.

Lee P. Miller Terms

there

natural resources, of reserves
international buying power, of

of

both in prodigious degree.

that
should be

the

J.F.Reilly&Co.,Inc.

16

Members Salt Lake

to

from

nature

chronically
mentals

adding to

consumption, but even

in

8

V-V

17

and

culties that beset nations that

performance, * not
only without
slightest impairment of its

.now

economy

not continue

Lauded by

!_______

Cleveland Trust Co. Cites Growth in Common
Trust Funds

and

the

But

regard

structure

Gold Price Policy

on

Lrt

7

—_—___

whatsoever why

reason

no

•

in¬

statement may sound trite
superfluous. But it is a fact
that surprisingly few people real¬
ize
how
vastly
any
economic
difficulties
that
may
befall us

the

to unheard-of heights of

wealth

our

Economists

This

demonstrated

and

political need for
an
active
policy
of
economic
guidance. And the war had dem¬
onstrated the fact that, given a

basic

Secretary Anderson's Stand
'■%
V
James H. Ward Is Dead

provide
a
high and steadily rising stand¬
ard of living for most of its people.

type. The

economic

of

it should

Great Depres-

With

abroad.

fundamental

the

condition

deep-going

ing

from

capital

or

CENTERS

Guaranty Trust Co. "Survey" Warns Against Clamor for
Federal Help in Speeding
Recovery

power.

need

we

reserves

from

come

preventingdepressions of

economy

'•

buying

that

at

firmly desired aim, economic pol¬
icy is .capable of guiding the

■

reserves

we caii pay hard
cash for
anytime, either out of current
export earnings or from our vast

Western

•thirties
•

to

abroad

the

£: and
v

regard

York

funda.

PHILADELPHIA

SALT LAKE CITT

0 *
;i,' Vn*.
<•
k'i 4
The Commercial and Financial Chronicle

V -w'm

4

is¬
of
dilution
of the common equity.
There are still outstanding (March
conversions of this preference

Garden State Utility

sue

By DR. IRA V. COBLEIGIf

A consideration

of the attractiveness

In the market

equities

tinguished

American

as

Okla-/

Texas Utilities

before the
of

June

-

cjfnd

19p8.

phenom-7

enon

would

to dispel
notion

tend
any

that we are, or

have

a n

as a

the

State

major operating utility
is

PEG

ritory

i

been, in
de¬

impressive.

spreads

over

Its ter¬

most of the

Jersey,

New

of

(.rogf-d

283

com¬

U.

ira

d

further i n d i-

Cobleigb

.;

'

>i-u'-

nace

of industrialization

the Delaware

i'.

•

♦

'

'•

»>

*

a

solid: investor

for rise iri future

earning power.

Public Service Electric and Gas

tal structure a

and made unwise the issuance of

ing

convertible

securities,

new

however, and on the
trends it is pos¬
project earnings of $3 per
by 1960 and perhaps a $2

To

this

in

move

Public

of

in consideration

and

our

is

need

a

rates. '

lor

rise

a

of PEG common,

turn

quired capital.

mention, but not to stress it.

Jan.

1, 1957 at the rate of 7/8th of
a
share; and, now and till June 30,
1960, at % of a share.
Steady

-

to¬
in

permitted a
attract the

re¬

re¬

So within the next

and

this

general

parable
been

New

other

utilities
The

satisfactory

of

service

OHIO

Statement of Condition—June 30,
RESOURCES
Cash and Due
United
State

States

and

Other
Loans

from Banks
Bonds

Municipal

Bonds
and

and

—

$

;

114,285,048.03
9,814,451.85

Bonds

Securities

4,647,016.62
156,256,121.97
4,449,659.34

Discounts

Banking Premises Owned
Customer's Liability Under Acceptances
Income Accrued Receivable and
Prepaid
Resources

Other

76,393,510.88

44,329.47
1,587,685.29

Expense.

509,847.05

TOTAL

$367,987,670.50
r===±====s

o

in

one

Undivided

($25.00 Par Value)

June 1

745,211 July 1 last year. This year'? highest was 865,566
March
1, while the record high was 903,789 units
March 1, 1956. "Automotive News" expects a succession of four
year lows in the monthly stockpile. Dealers in most of the better
selling lines now are agreed that the "clean'em out" of this clean
up period will result in shortages,
units

13,125,000.00
4,603,995.40

Total

Capital Funds
Reserve for Dividends,
Interest, Taxes, etc.
Liability Under Acceptances
DEPOSITS:

"•"Commercial, Bank and Savings
U.

S.

Government

Other Liabilities

TOTAL

with

sions

$5,964,690 08

Section




The

years.

of

the

more

nearing

preference

conver¬

~

Packard Car Production May Be

ufacturing this famous quality car which for 59 years was
hold
car

reach

$3 is not

a

Net

$2.70
wild

Meanwhile,
wards

even

$

29,603,995.40

today's

yield,

this

per

5,555,955.99
44,329.47

314,171,813.11
18,555,143.81
56,432.72
?367.987,670.50

considered

of the best in the fine

for

car

many

field.

The

years

Packard

an

was

a
a

house¬
luxury

outstanding hallmark

The distinctive radiator and grace-?

ful streamline

proportions of the Packard will always be remem¬
bered by all motorists and its slogan: "Ask the Man Who Owns

One"

known

was

the world

over.

The Studebaker-Packard

expected the company's

new

models will be in dealer showrooms

According to Harold E. Churchill, President of
the company, no announcement concerning 1959 models or lack of
them, will be made before the pre-view showing Oct. 16.
by mid-November.

June

Steel Production Highest in 1958

During June, the steel production in the United States totaled
7,132,000 net tons of ingots and steel for castings, the highest
monthly figure so far this year, according to the preliminary report
of American Iron and Steel Institute.

The

.

increased in the second qarter of 1958, as
compared to the first quarter of this year.
The second quarter
total

output

also

about 175,000 tons higher than in the
During the comparable
quarter of 1957 the output was 28,998,505 tons.

was

18,996,150 tons

or

first quarter of this year (18,790,857 tons).
second

During the

first half of this

year

the steelmaking furnaces

produced 37,757,007 tons, against 60,583,547 tons in the comparable

part of 1957 and 52,131,449 tons in the second half of last year.

Bank

Clearings Show 6.25% Increase Over Same
Week Last Year

Bank
with

a

clearings

year ago.

this week will

show

an

increase compared

Preliminary figures compiled by

us

based upon

telegraphic advices from the chief cities of the country, indicate
that for the week ended Saturday, July 12, clearings for
of the United States for which it is

ings

common

buyer with
durable

a

all cities

possible to obtain weekly clear¬

vyill be 6:25% above those of the corresponding week last year.

Our preliminary totals stand at $33,579,993,471 against $20,666,445,321 for the

the week

same

week in 1957.

At this center there is

Transactions in the New York
1958

as

a

gain for

ending Friday, July 11, of 24.9%.

against $9,911,883,175 in

area

same

totaling $12,379,626,956 in

1957 week, Chicago totaled

$1,115,845,306 in 1958 compared with $1,097,975,187

and

or a

Continued

1.6% gain

on

page

re¬
ESTABLISHED I694E

5%

equity

a sloppy
market, and a
earnings trend on the up¬

grade. The stock at 36 % yields
5%.
Nobody should buy it with
expectations of dazzling market

STATE AND MUNICIPAL BONDS
CORPORATE BONDS
LOCAL STOCKS

gains; neither is it likely to reduce
its dividend, as so
many companies
have been
is

common

and not

Cor¬

"destiny is tied to smaller cars." The
company will, it is stated, devote its efforts to building shorter,
smaller-wheelbase without fins, little chrome, less horsepower and
lower top speeds.
The company believes the trend will be to
smaller cars, and will discontinue its line of larger cars.
It is
believes that its

poration

target for 1960.

PEG
a

share

year

in

future

was

world.

the automotive

in

word

and

end an improve¬
share earnings over

predictable.

could

Discontinued

it is reported, will soon be a memory. The
Studebaker-Packard Corporation has decided to discontinue man¬
The Packard car,

an

badly

of trust money on deposit in the Banking Depart¬
under the provisions of the Banking Law of the State of Ohio,
1107.12 is a preferred claim against the assets of the bank.

ment, which

one

in per
the next few years seems reason¬

PEG
^Includes

the

ment

ably

or

on

on

those

with proven defensive
qualities, a
stock unlikely to sell off

$11,875,000.00

Profits

many

is

area

current

LIABILITIES

Capital Stock
Surplus

and

Continuing "Automotive News" said the mid¬

has

rapidly growing sections of the
nation, the management has been
imaginative in anticipating, and
planning for, future plant needs,

1958

inventories declined again in June indicating con¬

com¬

stock

stressing size and reg¬
ularity of dividend, and, for the
longer range, PEG looks livelier
today than for

CINCINN AT I,

car

stockpile in that year of selling reverses was 508,165. The
stockpile on July 1 v/as 672,842 units comparing with 741,251 cars

accounts

CO.

•

year

has afforded in
higher yield on its com¬
stature.

a

temporary levelling-off, unemployment shot up again
as

equity

a

than

mon

a

month

count been lower."

The

to

necessary

of

tinued production cuts and a modest increase in retail sales, "Auto¬
motive News" stated that not since -1954 has a July inventory

regulatory
climate in New Jersey is consid¬
ered good with utility rates based

almost continuous needs for addi¬

peak

New Car Inventories Declined in June

$101% million in 1957. There

further

average

record

new:

a

.

by $15 million (about 50c a share).

electric

to

that

13

students seeking summer jobs, reinforced by June
graduates, flooded into the job market. Another, drop in unem¬
ployment is exp6cted; when July job* -totals are annbunced early
next month.
* ;v. .•A
.v.,:'•
V~; C-r
>

Right now PEG is request¬
ing gas rate increases (the first
general gas' rate increase applied
for in 37 years) which,, if granted,
would
improve annual revenues

Service

aim in the foregoing was

After
last

order.

taled

climbed

employment

July

on

ployed and unemployed workers and members of the armed forces.

direction,

earnings and dividend-wise, some
rate increases" are definitely
in

Operating reveneus from gas

States

announced

Bureau

Census

65,000,000 in 1957 in spite of the recession layoffs in the latter part
of the year.
Actually, some 77,700,000 Americans—or two out of
every three aged 14 or older—worked during all or part of 1957.
This was a gain of 8,800,000 since 1950. Both figures included em¬

dividend.

into being

came

solution

United

of present

with the dis¬ ties, unlike their industrial breth¬ 24 months, some upward revision
Corp. ren, cannot finance very much out in electric rates appears reason¬
of retained earnings (fat earned able.
of New Jersey' in 1948.
(Gross from electricity was
While
primarily an operating gas and surpluses are poor bait for rate $221 million in 1957.)
increases). So 1,000,000 common
electric company, it still carries
While
some
utilities
haven't
about a $30 million investment shares were sold in 1956, $25 mil¬
recorded impressive increases in
lion in preferred stock in March
represented by ownership of the
gross
this year, PEG expanded
entire common stock of
Public of this year, and some $60 million
gross sales in all divisions for the
in mortgage bonds will probably
Service
Coordinated
Transport
first quarter of this year, with
Co.
This subsidiary provides, by be offered shortly, with further
industrial sales
advancing par¬
means
of 2,600
buses and 6,350 flotations in 1959 and 1960.
ticularly because the huge BayThis brings us to an important
employees, bus service throughout
way Refinery
of Esso Standard
most of New Jersey. It isn't very point in the PEG financial picture.
Oil Co. now gets all of its electric
profitable, earning in 1957 $989,- While total net earnings have
power from Public Service Elec¬
297 on gross revenue of $o'2 mil¬
been
advancing
steadily
since tric and Gas.
lion; and no dividend is being 1950, the net per share has not
The price of PEG common has
suit.
The
paid on this busline stock.
(It followed
figure was
been exceedingly stable,
ranging
netted a million dollars in 1956 $2.06 in 1950 and only $2.27 for
narrowly, since 1952, between a
and lost a million in 1955.)
So 1957; and this result, in a period
low of 25 and a high of 37. In the
much for the bus business which when net income advanced from
same period there have been two
is viewed, in a utility picture to$20.86 million
(1950)
to $34.38
dividend increases—from $1.60 to
•day, with the same general lack million (1957). The problem here
$1.65 in 1955, and from $1.65 to
-of enthusiasm that traction prop¬ has been a
large issue (originally
$1.80 in 1956.
erties were viewed in the early over 6 billion shares)
of $1.40
Dividends on the common have
twenties.
This bus business is a preferred
stock, now selling at
.relevant but unimportant factor 29 Vh, convertible into common to been paid in each year since 1907
Co.

The

sible to
share

J

VJ=

itself,

basis

Industry

Business Failures

into

This situation is correct¬

common.

Index

Price

Auto Production

and

the capi¬
little out of balance

Trade

Retail

Commodity Price Index
Food

All of which has kept

tional public financing, since

utili¬

Carioadings

shares to the present
of 12,209,653 common.

issue

Production

Electric Output

State of Trade

which, if converted, would

(individual
on "fair .Value" rather than origi¬
and institutional) preference Tor
nal cost. The property account of
equities of well managed and well
To keep pace with kilowatt de¬
PEG should, if appraised at fair
located gas and electric companies.
mand, PEG added $521 million to
Value, be substantially above book
its gross plant account in the five
Our nominee for discussion to¬
cost; and the Public Service Com¬
day is flirting with its high for years ended Dec. 31, 1957. $160 mission would be
expected to take
year,
and is cited for current million more is earmarked for a constructive
viewpoint on elec¬
examination
because
of
(1) its plant addition this year. Present
tric rate increases, particularly on
relatively high yield, (2) its sus¬ generating capacity (Dec. 31,1957) account of the
$450 million addi¬
tained growth in gross,
(3) its of 2.55 million kilowatts will be tion to
plant scheduled in the
prospects for rate increase and expanded to well over 3 million 1958-60
period. Needed new capi¬
(4) its extremely heavy recent by the end of 1959.
tal improvement to serve rising
plant investment creating a base
Expansion of this order creates demand must be
cates

Steel

add 1,900,811

served

Valley—all these
factors are giving PEG a dynamic
look.
Gross earnings have risen
from $171 V-i million for 1949 to
$322V2 million last year. ' ^ •
in

serious

pression,

on

is above 4J/2
million—3,578,000 receiving both
gas and electric service, 547,000
getting
electricity, • and 346,000
with
gas
only.
(About 225,000
customers
120%]
are
receiving
straight natural gas deliveries and
this percentage is increasing.) The
swing to suburban life, the rapid
rate of industrial growth, and the

-

all-time highs

that

population

recorded

This

5% return

Jersey City, New Brunswick,
Trenton and Camden.
The total

,

and

Electric,
all

a

munities, including all its major
cities—Newark, Paterson, Passaic,

Electric
homa Gas and

It is

symphony of the

past six months, leading utilities
have been virtuosi, and such dis¬

Power,

of

dollar utility company serving
of New Jersey—Public Service Electric & Gas Company.

most

to

tit

•

Thursday, July 17, 1958

.

The

-

preference

2,534,415

1958)

shares

shares of the billion

common

,

.

(F

has been the major cause

31,

Enterprise Economist

a

A
.

(200)

doing in recent weeks.

an

investment

and if you're an

quality
investor,

speculator, you may find
a number of
things about it that
you like.
a

RHODES-HAVERTY BLDG.
WALNUT 0316

ATLANTA

1, GEORGIA

LONG DISTANCE 421

30

Volume

188

Number 5760

.

,

.

The. Commercial unci Financial Chronicle
)

(201)

y\

them
basically ,friendly to our
country, looking anxiously to the

Time Is Running Oat in
The Economic Cold War
By A. WILFRED MAY
Money-Back Guarantee for
Fund

Buyers

correspondent, an econ¬
omist at one time residing in Amer¬
ica, John J. Stonborough, sends
interesting proposal
eliciting

which

an

is

they die and

Stonborough
buyer or a trustee could, for a
premium, be assured that

He

of

death he- will

tion

buyer

i.e.,

the

on

to

day

a

anteed

available

return

the

for

full

investment

an

escaping

both

I

subse-

Wilfred

A.

that

medium

on

both sides

of the

Atlantic, for enlarging the
companies, at lddst in the U. K., community of small investors.
But the proposal runs head-on
forsake smugness, he asserts that
■„

insurance

such

mechanism

a

is

needed

for

into

basic

several

difficulties and

drawbacks.

The needed actuarial
concerning future, change in,
the asset value of a portfolio in¬
Following are some excerpts of
his thinking on the subject as re¬ cluding equity shares over any'
specific intervals are, and must
cently published in The Investors
Chronicle of London, which he remain, unobtainable (even if we
should assume the trust experts'
asks us to "tear to pieces."
Be¬
performance record is the same
cause
of
the
timeliness
of
the

increasing the shareholder

lation.

popu¬

data

.

•

the

as

topic, based

on

the current popu¬

larity of the funds and the

preva¬

lent misconceptions about "moneyback" provisions here, we are glad

fluctuations

in

the

aver¬

which has been approxi¬
mately the situation here in the

ages,

U. S. A.).

objective; recapitulates

any

keeps.

Demands

Lusitania
Some
cold

has

the

as

of

the

buyers have

in

factory
mine

of

actuarial

to

proper

policy of
trying to get the
Continuity in investment. To the
new

big buyer, to the
accustomed

to

is

death

is

buying

lower

of

and

man

the fact that ICI
Nickel

no

or

securities,

International
the

on

little

woman

day

interest.

of

These

buyers assume that the heirs will
continue to hold these sound
rities.

The

buyers,
ested

in

new

secu¬

buyers, the small

all

intensely, inter¬
preserving the value of

are

their shares, so that on the day of

"edge" on the
insurer—presumably a losing, as
well as an unneeded proposition.
The investor with capital, unlike
those who require insurance for

and

subject that

headlines

3

knowledge
that;we are
beginning to

.•
•

growth
the Soviet

Union, the
growing

of

All these eveiits have hat-

trade

What is the nature of

w^t?ewiinfhf
rather

economic

tary conflict?

than

mili¬

a

What are the So¬

viet economic aims?

What

are

the

real achievements of the U.S.S.R.?
..

.

.

,

,

J,

.

What handicaps and what advanpossess

we

by

actual diversion of his

own

veloping?

These

war

What

America

do

the

in

eco-

that may be de-

but I shall
funds.; to them.

improve
hard

all

try

should,

can, and

to

are

to

our

proposal
grounds of

the

Moreover,

Lei
Let

me

give

answers

cent
ait

■

Truman, Washerman & Co.
TO PINE STREET,

NEW YORK 5, N. Y.

Cable:

and New Delhi,
for the first time I came

Rome

Last year

official

with

contact

the

of

WASTRUxM

in

as

securities and to engage

in special

and international financing.

of

tertained
tained




in

sees

the

capitalism.
society, and in our

our

the antithesis to its own
of totalitarian socialism.

economy,

system

would

RUSSia

seek

to

destroy

us

delegation

The Soviet

prepared

was

with

a

great many proposals and resolutions
the

which

ECOSOC

they brought before
meeting in Geneva.

They suggested that we ought to
have a world economic conference
nations.

of

They

.

suggested

States by making us,
ever-smaller
island

within

if it can, an
of

freedom

growing sea of Cornmunist power. It will seek to bind
"
to itself an increasing number of
a

the neutral and uncommitted na¬
tions

the

of

world

by

economic

a

dIr0™lmno "academic
conference of
They
supported
a

economists.

United Nations loan fund to help
the

by military

economically backward counTo all of these proposals I

those^untri^s dependence.withit
that* trade Ultieconomic

into

it

mately,

hope

will

cultural

their

achieve

to

penetration,

and

tries.

had been instructed by my Gov»

el.nment t0 say »No
.

N

Cnvipt'

;

'were

them

forth

phonies.

were

that

comfortable
cornered

me

did

not

when

Mr.

I

at

many

Some
I
l

Yet
Yet

feel very
Zakharov

diplomatic

re-

My country

a

and in Hungary.

these

m/moDagandisU^
»r
of

.

of

nut

manv

nroiins.ils

as

put forth proposals for world economic progress.
Where are the

.

What

is

the

„

primary

.

.

Soviet

cconomic aim? I thintr that we can

take at faco value the economlc

tbe Sovie£ Union that was

j

expressed at the 20th Congress of
communjst
Party: very re-

"Through peaceful comand in an historically

cenuy.
petition

*7=

.

of

n„riod

time

to

overtake

sPurpass

of

the United

weeks

me

on

of

Nations, many

Continued on page gg

.....

and

We

are

pleased to

announce

that

and

and

who

en¬

whom I enter¬
occasions.
I

Leon Lees,
William G.

Jr.

Carrington, Jr.

several

Ira

representatives

Haupt, II

highly trained in economic mat¬
Soviet

The

send

Union

doesn't

retired

politicians or un¬
people to represent it.

have become General Partners in

our

firm

effective July 10. 1958

Zakharov, who headed
Geneva,
of
seven
deputy for¬

the U.S.S.R. delegation at
was

one

eign

Union,

ministers
of
the
Soviet
a
professional diplomat
well-trained

a

found

Charles Henry

It

States

Democratic

of

may

six

some

and

william Snx washerman

citadel

acquiring more and
The Soviet Union
United

rep¬

You

Mr. Alexei

general business in invest¬

the

in

sees

when

U. S.

Economic

the

Council of the United Na¬

trained

to transact a

society- xt can be main-

power..,

repre-

U.S.S.R.

Geneva

ters.

4

more

,

London,

found these Soviet

>

Telephone:
!WHitehall 3-8864

abomination,

be interested in
some of my reactions to the men
in
the
Soviet
delegation, with
whom I had to deal over a period

the formation of

military

and

an

about that. Soviet society

ouPDUf»

tions.

announce

*5

personai experience During
and
the
most
highly
few years I have had the proposals
of your country?
I Ponltnli«?t pountrieq in oer caoita
honor and
duty of representing found the representatives of the
The
Soviet
Premier
our country abroad
in a number is nations whose members sit in Nikita Khrushchev has
put Soviet
of economic
missions,
in
Paris, the Economic and Social Councilv
-s.,
00

Social

pleased to

were

long

donhnSion ls

worid

tained only b

that

was

war as

-ryJ

the last

resentative
arc

line

weapons

ception and said.

<

begin by recounting a re-

serving in

Wc

Their

Scotch.

confess

questions;

.

sentatives

situations

United

Rlnc and the West? Will it become
Bloc and the West
Will

into

ment

the

with

urally raised several questions in

tages do

shooting

a

^

1S a Power

Soviet

honestly believed this.

chances of winning this conflict?

or

is de¬
on
publicless than the day when 'Father structive
policy. Giving the investor a
bought them for us.' "
seemingly cheap and r i s k 1 e s s
"It is here that the insurance
means
of
protection
from
the
companies could assist greatly' in
ravages of currency erosion would
providing a mechanism by which
men
and women can buy
Continued on page 31
Unit
death the shares will not be worth

Neil H. Jacoby

States.

TIru

not speak
co>-existence?

force, if it believed
that
their
economic
system
is this
poSsible without itself suffermore
productive than ours, and
ing mortal wounds. But in view of
they were willing to compete with om.
currently
great
deterrent
us economically,
and to let time military strength, it will seek injudge the results. I think they stead
to
dominate
the
United

dollars

Rlifr

the

(

the

minds.

found

r

Kremlin be foolish

the

provoke

our military power
they felt quite confident

nuclear

world,
and
the
recent,
rather
startling, proposal of the Soviet
Union to negotiate several billion

an

to

or

*

Union

Soviet

"competitive

fear of

warfare

economic

around

no

and that

and

amount of So¬

our

of

delegation
stressing economic matters. They
spoke a lot about "competitive co¬
existence," a phrase to which we
drank many toasts in both Vodka

nomic

aid

had

,

all, why should the leaders

the

Wouldn't

struck.

was

Harbor.

Domination Aim

;

After

when

as

f
of

their
about tneii own militarv rower
military power.
I

acquire about
the rapid eco¬
of

dedication

Pearl

Thwarting Soviet World;

•

amortizing a
reserve
for
estimated
possibleshrinkage, either mentally or by
investment;

us

sense

same

a

nomic cold

is

with

conflict "for

of urgency
dedication
that

same

tary technology.. This was before
Sputnik. I didn't know it at that

re-

better off insuring
himself—either by obsorbing any
depreciation in the value of his
protection,

conflict
a

in their attitude. They knew then
how far ahead they were in mili-

the

the

of

countries

women

the

eme

cently,;
result

a;

and

urgency

der developed

obstacles

and

the

and

advantages and sets forth
war—a conflict for

our

West

the

is

into

come

deter¬

main

men

with

simple

compares

sunk and Pearl Harbor

aspects

between

war

the Soviet Bloc

same

was

economic

basis

the

of

way

to understand

It must be fought by

keeps."

six-fold program to win this economic cold

premium cost, the
purchase of such insurance would
small means who wish to invest
be wholly uneconomic. The proper
in shares is the risk of putting
motive
for
the
individual's
ac¬
too much money out of the small
quisition of insurance is to pro¬
sum at their disposal into a share
cure
protection which he cannot
that may fall in value," Mr. Ston¬
otherwise afford. For the investor,
borough writes. "All shares may
using his capital to buy securities,
fall; most good ones come back.
to pay an additional sum for the
What the new investor fears is
"protection"
of
his investment,
the loss in value of his shares in
would be tanatamount to betting
the event of his death.
Most of
against the insurance company, to

of

"One
the

come

economic

the Soviet Union is

foreign trade; refers to his

UN conference abroad;

ex¬

a

this

sunk,

un¬

at

eco¬

'•

being

arrive

-

the

after

viet

More fundamentally, even if we
could

objections.

on

Americans have shown in the past

tended to

our

fought

re¬

"cold

...

—after the Lusitania was

mutually satis-,

to give circulation to the idea and

that

USSR economic objective to catch up with us to our lack of

make

erosion of the

ther the aim desired

May

be

some

and

that, the

namely;

people must

war,

nomic progress at a

easily

currency

quent death.

Urging

thus

studies

-

some¬

nomic front, and the opening bat¬
tle has
already begun.
It con¬
vinced
me
that
the
American

uncomfortable inability to recite our proposals for world eco¬

and also of the investor's
capital, this would, of course as
our correspondent maintains, fur¬

purchase price
his

could

we

shooting

a

my

will

of

for

about economic dependence of other countries, through tech-

The Basic "Bugs"
If

guar¬

war"

truth

suspected

from

search,
:

the Kremlin believes: it would be foolish to

as

had

nical assistance, economic aid and

investment

shares

time

the

of

me

I

'

trust

end."

an

thing

there is a good chance to succeed this
way, and we maintain deterrent military strength. Dr. Jacoby
appraises Soviet's economic and educational capacities to bring

to admit

the

vinced

Business Administration

President Eisenhower envisages continued Soviet

long

so

provoke

that what he bought is now worth¬

compa¬

of

initia¬

the

What proposals do we have?

I have pondered this personal
experience at Geneva. It has con¬

pursuit of world domination via economic and cultural penetra¬

re¬

same

at once. No trustee likes

company

the

advisor to

a

comes

at

years

small

for

of

five

School

Taking seriously the economic threat of the Cold War and
the grave facts of Soviet economic growth, former economic

heirs," Mr.
continues.
"If

less,

of

guaranteed

the shares go on to the

nies to provide

the

are

price as he
paid for the Units, the demand for
such Units would rise steeply and

insur¬

ance

say,

tive.

University of California, Los Angeles, Calif.

value for these shares if

same

ceive at least the

interest

wants

and

in the event

considerable

abroad.

the

shares,

after,

A British

us

Trust

Graduate

States to! take

United

By DK. NEIL H. JACOBY*
Dean,

5

economist.

Ira Haupt & Co.

I

Members New York Stock Exchange

the members of the Soviet

delegation confident,

even

and other principal

cocky,

Truman

NEW YORK
♦An address by Dr. Jacoby before Con¬
of American Institute of Indus-

vention

triad

19,

Engineers, Los Angeles, Calif., June
1958.

exchanges
CHICAGO

6

The Commercial and Financial Chronicle

(202)

regardless

A Producer's View of

,

Canadian

oil official reaches the verdict that the

come

available

There

liability,

a

10

reached

has

critical

a

reached

point because
However, despite the fact that
expenditures in the industry have it costs just as much to find gas as
exceeded income every year since it does to find oil, it is significant
1947, a fact which has necessitated to note that virtually all of the

•.

\':...

CjJ

Costs High, Returns
Last

year,

day

a

on

the

year,

that

they received,
royalty,

the

same

and Producer

than

the

money—for

and

work

ex¬

drilling.

ploratory

less

B

On

spend exactly

of

amount

seismic

geology,

million

us assume

identical holdings.

have

these holdings they

of

only $400 million or $147

amount

Producer A

both

after

this, let

has

as

chaser

The

been

sug¬

time in the

to

D.

E.

pended. during the

year.

on

and

Let

oil

10

oil

five

gas

for

•An
the

Bay,

address

Canadian

last

10

the in¬
something like
years,

same

by Mr.

Loughney before
Association, Murray

Gas

assume

us

coveries

are

amount of money on explo¬

and lease rentals will be the same

Quebec.

fuels

price of

gas should*be permitted
to find its own level. ■^v''rv
*. v

A

'•

*

"

r

;'.r

;

.;

Costly Operation
let

Now

which

look

us

the

at

)

'

•

It may

OF

CONDITION

Brookline

faces

be

—

adequate price for

an

few

of June

30,

in

number

size.

and

usually
fields with

Deep

higher drilling costs, and

sour

1957 and June 30,

requiring special
plants
are
mueh

essing

risks

$: 2,072,726.29

$ 2,912,353.81

4,675,286.36

4.675,103.23

2,345,720.99

2,559,990.14

16,871,468*33

U, S. Government Bonds
Other Bonds and Securities....
Loans

20.203,707.68

Demand

and

to

Official
Other

Reserve for interest collected hut

exists

to

of

oil

the

on

producing

of drilling

cost

particular

a

terms

earned..

of

well

$28,169,642.97
284,238.14
64,796.99

1,102,388.38

1,273,216.00
500,000.00
2,000.000.00

419,458.81

the

$32,801,841.05

Savings and Trusl
COMPANY

ducers,
that

820 Brookline

Boulevard

McNeilly Road

PITTSBURGH

at

Sussex

26, PA.

Member of Federal Deposit Insurance
Corporation




the

gas,

source

a

and

it

must

be

of

obvious

equitable division of

more

will have

to

be

arrived

at if additional

reserves

discovered

point out that this
surplus figure is most conserva*

ex¬

tive

since

data

more

it

is

based

reserve

on

conservative than what

lias actually taken place over the

same

past five

years.

.

carbon

./

-

derivatives

such

as

pro¬

existing

and

reserves,

in
the
plants

butane,
natural
gasoline,
sulphur, methane and ethane in

construction

of processing

and

-

the

must be made available to attract

pane,

manufacture

products such

of

countless

synthetic; rubber,
plastics, synthetic yarn, explosives
as

fertilizers and

so

the

Canada

as

Reserves

stated

we

having

to be

in

abundant

for all

resources

needs,

our

required
demand

Markets

this

for

for

natural

Canada, in relation to the

presently available and
discovered, does not provide

adequate incentive for continued
exploration and development.

has

more

is

gas reserves, the producing
companies would have to reduce

specif¬

And

become

discovered

procure

than..27.5

expected

to

re¬

trillion

with

than

more

industry will

that

the

future

trillion

100

over

requirements

gas

of

sary, and
and
poor

the lengthy pipe

where

only

processing is

load

factors

THE

On

we

lines

involved

higher costs.
other hand, increased

the

would

provide

centive to promote a more
and

OF

intensive

the

in¬

orderly

development

of

CONDITION

MASSENA

BANKING

AND

COMPANY

Massena, New York
AT

THE

CLOSE

OF

BUSINESS

CONDENSED

JUNE

23rd,

1958

STATEMENT

ASSETS

Cash-oil Hand and in Banks

.5-.

.

AV'$ 2,067,466.13 *

Federal Reserve Bank Stock Owned

4,886,295.04
17,250.00 f

Collateral and F1IA Title I Loans

1,455,324.75

FIIA Mortgages Fully Insured By U. S. Government
and GI Mortgages
Real Estate

Mortgages

Bank

1,031,195.99 '

..-,

.'

Building

90,895.00

Bank Modernization and Furniture and Fixtures
Other Real Estate Ow ned

;

1,616,656.40
950,234.85

i................

Loans and Discounts...

\

94,172.38

.1.

Other Assets

;

68*250.00
-12,466.36

to be

$12,290,206.90

•

LIABILITIES

Canadian

through
and

operators

many

years

have

gone

of exploring

developing gas reserves with¬
markets, and it is our view

Capital
Surplus

.....$

.........

soon

Unearned Interest and Other Liabilities.............. '

develop
and

out

cannot

gas reserves on

when

needed"

not

be

the

necessary

to

an

basis.

expected

exploration

denied

continue

and

to

"if,

"

*$12,290,206.90

as

carry

be

additional

markets

return

millions

the

Valuation Reserve Not Included $120,799.95

to

P.

They

then

216,321.08

'

avaliable.

Producers

should

127,051.82
11,371,834.00 i

i., *........

that many of them may not sur¬
vive
unless substantial markets

200,000.00
375,000.00

'.

Undivided Profits and Reserves

Deposits

H.

FALTER, President

DESIGNATED
U.

S.

DEPOSITORY

Government, State of New York, Power, Authority,

County of St. Lawrence, Town

a

neces¬

would result in

cubic

REPORT

up

from

minimum

gas

available,"

Transmission

fields

mature. How¬

are

fuels.

other

markets

if markets

ever,

found,

never

happened, it would
increasingly difficult to
gas at a price competitive

scattered

opinion, if the industry
already

that

companies would have to pick

and

use

has to wait 25 years to market the
reserves

if

industry in the

committed to export over the next
25 years!
our

the
necessary
incen¬
continue to find and de¬

exploration for economic reasons.'

feet—1.5 trillion

Canada

to

velop

these future

looking

even

ol'

serves

cubic

Without
tives

natural

t

decade

past

feel

in

gas

facilities.

reserves

Abundant

In

capital

growths The

on.

'

gas

related

developed.

and

are

Incentives Needed

are

Two Convenient Locations

accepting-

supply. However, this is at best a
marginal operation for the pro¬

out

426

leap from 4% to 25% in the
period.

:

I would also

needs by 1980.
alone is expected to

>or

past few years in order,
establish markets thou¬

help

509,946.95

BROOKLINE

been

low wellhead prices for their

revenues

Undivided Profits

gas

nation's

without

Canada's requirements.

energy

Natural

the

part of
export
jeopardizing

some
sold
to

be

U. S. Government Bonds and Other Securities.

Producers have

to

500,000.00
1,750,000.00

Surplus

of

trillion,

could

and

structures.

sands of miles from

.

Common Stock

70%

be

field.

over

$27,953,180.68

Capital:

Gordon Report,
fuels, which sup¬

plied 46% of Canada's energy re¬
quirements in 1953, are expected
fill

will

a

$32,801,841.05

47,506.87
not

markets

to

tril¬

17.5

25-year sup¬
needs
and

a

Canadian

cording

panded

of

1962

export
at
the
1962
level. This would leave a surplus!
which

TRUST

situation

same

yield and product price*

Liabilities....

assure

of about 13.5

cover

.

72,737.76

June 30,1958

for

in

authorized

devel¬

Crude oil is priced accord¬
ing to its value to the refiners in;

$10,144,391.92 $13,545,663.83
13,752,962.36 14,623,979.14 $23,897,354.28
Checks Outstanding
236,472.34

feet

reasonable

a

380,341.72'

..

volume

a

is

1,967,606.7 F

LIABILITIES

that

cubic

opment of the oil and gas industry

degree with crude oil, but no at¬
tempts are made to base the price

<

June 30,1957

of companies

in this country is tremendous. Ac¬

the

,

Commission,

February it was the;
submitting

in

sufficient to

Beckons

in-

price

$27,953,180.68
Deposits:

briefs

Borden

more

and

cent

406,275.76

,

hearings

ply

to

to

or

43,917.51

Bank Building and Fixtures...
Other Assets

solution

The potential for future

these 'two fossil

increased

*

proc¬

1,537,785.44

Mortgages Owned

the

the

lion

Future

have

Surplus for Export
At

resources.

of gas surplus to Canada's present
and foreseeable needs.
The

years — in¬
Canada's re-i

about 30.8 trillion cubic feet.

consensus

.

year

necessary

gas

that

4:7

most conservative

lowest

will

serves

problem would be a policy
permitting the immediate export

investment.

on

The

June 30,1958

country,
10

inadequate

involved

return

June 30,1957

this
the

cases

definitely

1958

ASSETS

Cash and Due from Banks.....

in

common

these

PITTSBURGH, PENNSYLVANIA
as

in

wet fields

Savings and Trust Company

view

our

an¬

of

peak

a

three

with the further utili¬

Canada's

cubic feet

a

dicates that By 1962

to this

produced from sweet, shallow

gas

small

of the

is

It

of

funds

costs' ically for gas, the

point in most fields.

even

are

STATEMENT

zation

Without

the

producer

gas

r

fields, but in Canada such fields
COMPARATIVE

to carry on

the

the

on

investments already made,

furnish

with

projection of these figures—based

pay for gas is strictly,
what he can sell it- submission to the Royal Commis¬
on
Canada's
Energy
Re¬
competition
with other sion
in
his
market
area. -The- sources, there is no question about

Producer

ration; and in the future, surface

con-:

will provide a return on the large

However,

that all the oil dis¬

identical.

problem

fronting the industry today is the
development of gas markets that

and

trillion

2.7

nually,

trillion. Even

immediate

frozen

of

age

drive

prices upward.

The

/.

the

past; five < years the
industry has discovered an aver¬

pur-'

any

exploration, development drilling,
gathering, field production, proc¬
dustry has spent
A then receives twice as
much essing and plant investment.
$3.2 billion on these operations,
revenue
as
Producer
B,
if the
Considering all these factors, it
from which only $1.9 billion has
latter is unable to sell his gas. is easily seen that a price of 10
been recovered to date; so that
But each producer has spent the cents is little more than a break¬
Over the

to

be discovered in the next

can

Over

in

dis¬

discoveries.

markets

Thursday, July 17, 1956

.

quarter century.

governed by

his land; Producer B,

coveries
five

1

finds

A

Producer

Loughney

amount

can

,

ex-

only tend

of

estimated

will

feet

develop
excess

.

Continued growth of the indus¬
S., that the uses to which gas'
In. addition, Canada today is on try will require
can
be- put should be limited by •
heavy capital ex¬
the threshold of a rich petrochem-.
government action.
penditures in the search for new
development using
The natural laws of economics' ical
hydro¬ reserves, in the development of

markets.

To illustrate

which

income

feel,

are
always far superior to manmade laws, and should be allowed
usually found dur¬
to establish such things as usage'
ing the search for oil, many peo¬
and price.
ple take it for granted that gas
Nor do I agree with those who'
is a bonus to the operator. As a
matter of fact, unless markets are say that the price of gas in Can¬
ada would necessarily be pullecf
available gas reserves become a
upward by prices paid in export*
liability.

$ 5 4 7 mil-

from

not

Risky Business

That amounted

whole

petroleum production in the

10 years.

do

Since gas is

producing
operations.

for

applications where it is not eco¬
nomically suitable, replacing such
fuels as bunker coal.
However,

U.

$1.6 million

ex¬

de¬
velopment and

lion

vides.
Under-pricing gas is a
dangerous
practice,
because
it
puts all other fuels at a competi¬
tive disadvantage, and sooner or
later you find gas being used in

gested from time

last

ploration,

to

at

cents

43

to

Canada's

my

I

from

Cana¬

for

expended

substantially in

require¬
ments for the next 25 years. Un¬
necessary delay in obtaining such

be

3.4% of the total income realized

.•

Low

for example,

dian producers spent

sells

industry's income so far has come
only

capital annually.
'

oil

from oil. Gas has contributed

the attraction of large amounts of
new

In

contention thatgas
priced in accordance
with the amount of energy it pro¬

critical

a

is

It

should

billion.

have

of .energy,.

amount

wellhead—approximately four
times as much per BTU!
;
»

expenditures for the past decade
income
by $1.3
stage have exceeded

development.We

the wellhead

at

cents

the

petroleum industry in Can¬

its

in

this
crude

of

lack of markets vis a vis conservatively
projected huge surplus. States solution "would be a policy
permitting the immediate export of gas surplus to Canada s
present and foreseeable needs."
ada

13.25

to

for

market price reflecting

The

one

.

sharp contrast, one million BTU's

even

due to its low

though it is usually found with search for oil,

approximately

are

of
natural
gas,
and as you all
know, the producer receives from

Mr. Loughney avers the industry may

soon,

Gas is said to "have become

not survive.

wellhead

million BTU's in 1,000 cubic feet

petroleum industry has reached a critical stage in its develop-1
ment in view of expenditures exceeding income every year
since 1947. Unless substantial markets for gas reserves be¬

dollars

all

when you com¬
prices of natural
gas
and crude oil in terms of
BTU's, it becomes very apparent
that producers are currently sell¬
ing their gas at bargain basement
prices.

British American Oil Company, Ltd.

Toronto, Canada

of

reserves

Furthermore,

pare

By E. D. LOUGHNEY*

Canadian

dis¬

of

type

Prices Are Low

Canadiau Natural Gas
Senior Vice-President,

the

of

covery.

.

of

Massena.

State of New York,

Village of Massena

Member Federal Deposit Insurance Corporation, Member Federal Reserve System

Volume 188

Number

5760

.

.

The Commercial and Financial Chronicle

.

t

(203)

readily accessible
in

the

most

resulting

areas

economic

movement

of gas at reasonable prices for all
concerned.
'
•
T' •'
'

•v-V'

In the final

analysis, the orderly

development of adequate markets
for Canadian

gas

to the distributors

is

it

is

to

the

producers.

The

Guaranty

warns,

with

is

ernment

business from offices at 316 North

pressure

'Hr
_

(

'

(

;

,,

,

'

■''

_

■

,;

.,

'•

-■

i\

Trust
quick

"V'

•'

Joins R. J. Steichen

J.

Steichen

&

recession

Co.,

Baker

Building.

?-In the July fssue of "The

Guar¬

whole

has

dream

desired.

of

awakened

perpetual

from* the

boom

under

government auspices."

ing

out that
oil' each
occasion
there have been those who feared

that society was
sinking into a
Survey," business and eco¬
If business
recovery becomes an state of chronic stagnation.
review, the bank said that extended
process,
the "Survey"
"Such forebodings of
although • the*e
are
disaster
increasing Said, the "temptation to intervene
have
signs that the decline in business will continue and
invariably- proved false,1n
may become ir¬
Guaranty said. "Economic life has
activity may be at or near its resistible. Yet, in the
long run,
always recovered from these set¬
end, a majority opinion among the

anty

has

bottoming

may

on

0

to

be

that

no

proves to be
production and trade

if

continue for

some

time at approx¬

imately present levels—how long
the clamor for inflationary

will

'shots in the arm' remain silent?"
the bank asked.

the

Unfortunately,

Company

general tone

July 10 cautioned
an

—

"affords
the

up¬

it

warned,

of current

little

more

is

"If this judgment

correct

the

of

be revived if

seems

quick upsurge is in sight.

gov¬

with

out

Guaranty Trust

of New York

that it

subsided

economy will be healthier and

forecasters

While pressure for government¬
al intervention to counteract
the

^MINNEAPOLIS, Minn.—James
W. O'Malley has joined the staff slump,
R.

in

intervention may revive
for economic stimulants.

apparent

of

Company
upsurge

danger that proponents of

FORTVILLE, Ind.—Norman H.
Brinsley is conducting a securities
Main Street.

no

business activity expected, there

Brinsley Opens Office

swing is less rapid than might be

nomic

Speeding Recovery

important

as

as

Warns Against Glamor
For Federal Help in

the

comment

encouragement for

hope that public opinion

as

a

prosperous if the temptation
business is given

resisted' and

time

to

steam,

under

recover

Spontaneous

the only true

its

backs

and has gone on
levels of achievement."

is

Seymour

eco¬

nomic societies have been demon¬

in

strating their recuperative

offices

since

ever

into

such

powers

societies

being."

" '■■■?.'/■

Economic

/ and

a

Blauner

securities
at

137

noneconomic

literature abounds in references to
"hard times," the bank

said, point¬

been

Corp.,

Midland

Price 98V2% and Accrued Interest

$30,597,600
Debentures, due July 1, 1980

The

Company is offering to the holders of its outstanding Capital Stock the
right to subscribe for the &tVi% Convertible
principal amount for each 23 shares of Capital Stock held on July 15, 1958.
The Subscription Offer will
expire at 3:30 P.M., Eastern Daylight Saving Time, on Juty 29, 1958.
The several underwriters have
agreed, subject to certain conditions, to purchase any unsubscribed Convertible Sub¬

Subordinated Debentures in the ratio of
$100

set forth in the

during and after the subscription period,

applicable Prospectus.

may

offer Convertible Subordinated Debentures

;
/

Subscription Price 100% 0

This announcement is neither

offerings
are

offer to sell

;:

:

■

/

-

a solicitation of an offer to
buy these securities. The
made only by the applicable Prospectus. Copies of the
applicable Prospectus
obtainable in any State from
only such of the undersigned and such
an

nor

are

other dealers

as

may

lawfully offer these securities in such State.
_

Harriman

Ripley & Co.

Incorporated

Blyth & Co., Inc.

°

i
.

The First Boston Corporation

Glore, Forgan & Co.
Lazard Freres & Co.

Smith, Barney & Co.




Kuhn, Loeb & Co.

Goldman, Sachs & Co.

Hornblower & Weeks

.

Kidder, Peabody & Co.

Merrill

Lynch, Pierce, Fenner & Smith

Lehman Brothers
Stone & Webster Securities

Eastman Dillon, Union Securities & Co.

Corporation

White,Weld & Co.

Dean Witter & Co.

from

Street,

Mr. Blauner haa

Securities

Securities

and Batkin & Co.

Sinking Fund Debentures, due August 1,

ordinated Debentures and, both

[I

engaging

38th

with/Sinclair

$40,000,000

as

East

New York City.

■■

July 16, 1958

4V2% Convertible Subordinated

is

business

came

New Issues

5%

.

Seymour Blauner Opens

recovery."

Guaranty noted that "free

new

;

own

recovery

to

Corp.,

8

The Commercial and Financial Chronicle

(204)

Anderson's Stand

Commodity Dept. for
Williston & Beane

Dealer-Broker Investment

Recommendation's & Literature
It i« understood that the firms mentioned will
toecnd interested

I.

Letter

Atomic

rocket fuel

No.

uses

7, D. C.

69-year

firm of J.

old

stock

and

commodity

Washington

stand

Trust

Northern

July issue of ''Business

Company,

Northwest

The

La

Chicago 90, 111.
United States—Comparative fig¬
30, 1.958—The Bankers Trust Company, 16

Salle and Monroe Streets,
June

as

Wall

Street, New York 15, N. Y.
Corporate Earnings — Analysis

Japanese

—

Nomura Securities

Co., Ltd., 61 Broadway, New York 6, N. Y.
— Current
information — Yamaichi Securities

Japanese stocks

Company of New York, Inc.,

Ill Broadway, New York 7,

New York.

Latest Field

Report—Harris, Upham & Co., 120 Broadway, New

York 5, N. Y.

Life Insurance Stocks for Profit and Growth—Data on 80 com¬

panies-— Paradise Securities Company, 9477 Brighton Way,
Beverly Hills, Calif.—$5 per copy.
Mid Year Review—Business outlook—H.,Hentz & Co., 72 Wall
Oil

Companies—Study—Bqni, Watkins, Jason & Co., Inc., 37

Wall Street, New York 5, N. Y.

Oil

Production

from

Com
Alpheus

Eastern

Middle

Countries—Survey—Ira

Haupt & Co., Ill Broadway, New York 6, N. Y.
Over-the-Counter Index—Folder showing an up-to-date com¬
parison between the listed industrial stocks used in the DowJones Averages and the 35

over-the-counter industrial stocks
both as to
yield and market performance over a 19-year period —
National Quotation Bureau, Inc., 46 Front Street, New York
4, N. Y.
Paper Industry—Analysis with particular reference to Nekoosa
used in the National Quotation Bureau Averages,

Milwaukee

waukee

Company,

East Michigan

207

member of

15, N. Y.

Planning Your Future With Mutual Funds

—

Booklet

—

single

request—National Association of Investment Com¬

panies, 61 Broadway, New York 6, N. Y.
Public

Utility Districts in the State of Washington—Tenth an¬
survey—John Nuveen & Co., 135 South La Salle Street,
Chicago 3, 111.

nual

Put & Call Options— Booklet on how to
Schmidt &

use

them

-—

Filer,

on

Uncommon Values in Common Stocks

Bulletin

Shearson,
Hammill & Co., 14 Wall Street, New York 5, N. Y.
Also
available is an analysis of Emerson Electric Manufacturing.
«

—

—

—

Joseph Faroll & Co., 29

Broadway, New York 6, N. Y.
5, N. Y. Also available is
&

Chemical

a

report

on

Investment Com¬

Company Ltd.

—

Review

Continued

—

on

James

page

39

com¬

and

COMING

studies

profes¬

EVENTS

sional advice

in

fields

the

of

mo

n e

credit

Robert B. Anderson

since

its

organizational inception dur¬
ing devaluation days of 1933-34,
has served as a research-watch-

—

William
H.

S.

Wasserman

Truman

and

have

an¬

Truman,
Wasserman & Co., 70 Pine Street,
New York
City, to "transact a

Mountain
nual

of Denver-Rocky
Group IB A 24th an¬

frolic at the

summer

lumbine

the

Broadmoor.

'The Administration has made
Oct. 6-7, 1958

many
occasions, most
recently at the September 1957
meeting of the International Mon¬
on

Association
Firms

etary Fund, that the United States
has no intention of

price

of

gold

or

devaluing

the

Hotel.

at Somerset

30-Dec.

Nov.

Governor!

of

Board

meeting

increasing the

(Boston, Mass.)
Stock Exchange

of

(Miami

1958

5,

Beach, Fla.)

dollar.

I may say without qualifi¬

cation

that

be

of

America

nancing."
The firm intends to
make application to join the Na¬

the position of the Government.'"

at

the Americana Hotel.

tional

Association

Dealers.

have

States and abroad.

and

began his

career

two years later became

of

the

tion of

Investment Bankers Association

Nov. 2-5, 1959

of the Economists' National Com¬

National

ciation

Monetary Policy, wish

on

Trimble

That

&

same

Investment

to

state

publicly that it

in

Co.

year he
Corpora¬

is

annual

convention
f

(Boca Eaton, Fla.)

Security Traders Asso¬
Convention

Annual

serves

ment.

We

that under

position of
wish
no

to

Stowers Adds io Staff

our govern¬

state

(Special to The Financial Chronicle)

further

KANSAS

circumstances

CITY, Mo.

Strumiilo- has

A.

—

been

should the dollar of this ration be

the staff of Stowers &

devalued again because there are

4725

William

added

President.

Syandotte.

and

President

first

ware

Mr. Wasser¬

founded

of

also

man

served

the

PUBLIC RELATIONS EXECUTIVE

as

Dela¬

Fund.

Prior

World

to

War

II, 'Mr.

Wasserman devoted much time to
economic

problems

Available

due

relations.

supervising and

representing

States

Conference

the

Conference

in

Labor

Geneva

and

abroad, for almost 40
began his career in 1919 in

Guaranty Bank in Vienna.

Bank,

England, where he

man

capable of organizing,

broad program.

Commercial
York

&

Financial

Chronicle,

25

Park

Box C 717,
Place,

New

7, N. Y.

He

and

London, one of the world's oldest
foreign exchange firms, from 1933
to

in

Here Is A

Special Opportunity for You:

"FOR SALE"

was

the British Dominion
Finance Corp. He also served as
a partner of
Scaramanga & Co. in

f

^

Beautifully Bound Set of
Commercial & Financial

Chronicles,' 1914-1952

Available in New York City—Write or

1939. '
He

came

1951

and

to

the

spent

Vice-President

Teletype NY 1-376-377-378

a

for Cor dell Hull, then

war

associated with such banking in¬
stitutions as the British Dominion

Trinity Place, New York 6, N. Y.

coordinating

in

Mr. Truman, a veteran of the
investment banking business, both

&

Troster, Singer & Co.

Young and able team

Secretary of State.

moved to

Members New York Security Dealers Association

re¬

making a special study
Germany's economic ability to

Austria with the Compass Credit

Bought—•Sold

Highly

and

years,

Cutter Laboratories

cutbacks.

in

United

at the International

Office

here

Collins Radio

Economic

Recession-caused

garded because of the superior job done in. corporate public

in

Chief Delegate to the

as

to

of

United

States

years

Blair

&

as

specializing in international busi¬
ness

and

special situations.

Phone REetor 2-9570

Edwin L. Beck

a

Co.,

to

Company,

Philadelphia, a private in¬
trust, which he still

as

at

the Boca Raton Club.

for¬

tunate for the United States that
such is the

Dillon, Read & Co., Inc. in

partner

a

to

mittee
new

Mr. Wasserman

1926

continues

"We, the undersigned, members

firm's

principals
experience in the in¬
banking field, both in

the United

with

Securities

of

this

-

long

wage

Gustin-Bacon Mfg.

Co¬

Country Club.

general business in investment se¬
curities and to engage in special
situations and international fi¬

on

Canadian Superior Oil of Calif.




Club

Bond

greater measure of success than
generally realized and appreciated.

clear

nounced the formation of

Berlin

Republic Natural Gas

"

Aug. 21-22, 1958 (Denver, Colo.)

dog of our monetary affairs with

"

1937

HAnover 2-2400

Investment field

In

y,

a

Co. Formed in N. Y.

1931;

74

a

mittee,

serving

Current trading favorites
,

contrary to sound

are

ciple if

behalf of the U. S. Government—

financial institutions

because

prin¬
nation is to have a good
standard monetary unit." •
V.3
they

Truman, Wasserman

overseas

For

consideration

serious

of

or

futures.
He noted that
Sept. 18-19, 1958 (Cincinnati,
the firm has long accepted
Its office is located at 1 Madison
Ohio)
brokerage orders in all commodi¬
Avenue New York City. Dr. James
ties as part of its regular service
Municipal Bond Dealers Group
Washington Bell of Northwestern
annual outing — cocktail and
to customers, this move marks the
University
and
Dr.
Walter
E.
dinner party Thursday at Queen
initial establishment of a depart¬
Spahr are the Committee's prin¬
ment which will specialize in the
City Club; field day Friday at
cipal officers.
Maketewah Country Club.
handling of professional and semiThe text of Committee's state¬
professional transactions.
Sept. 29-Oct. 3, 1958
(Colorado
ment follows:
Springs, Colo.)
"Secretary of the Treasury An¬
National Security Traders Asso¬
derson made the following state¬
ciation Annual Convention at
ment on May 6, 1953:

the

Tar

abroad

for monetary
and fiscal programs which might
lead to such action, pre unworthy
action,

vestment

panies.
Dominion

in

modity

formed
—

Blaw-Knox—Analysis—Halle & Stieglitz, 52 Wall Street, New
York

Conlin,

York Cotton

accounts

Philadelphia.

)ii

Bulletin

such

for

V

banking and

speculative

vestment

products and services—BlawCompany, 1231 Blaw-Knox Building, Pittsburgh 22, Pa.

Arkansas Louisiana Gas

the New

Both of the

Broadway, New York 6, N. Y.
This Is Blaw-Knox—Brochure

•

non¬

whose

In
announcing the move,
Alpheus C. Beane, directing part¬
ner, said the firm will begin im¬
mediately to solicit trade and

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

Radical Growth Stocks—Survey—E. F. Hutton & Company, 61

Knox

Conlin

B.

Exchange.

Charles

review—Chase Manhattan Bank,

18 Pine Street, New York

on

Donald

the direction of Donald B.

Street, Mil¬

2, Wis.

Petroleum Industry—Annual

copies

Beane

changes has announced formation
of a commodity department under

Edwards Paper Company and Sealright Oswego Falls Corp.—
The

C.

while

Street, New York 5, N. Y.

im¬

the

partisan, non¬
profit research

Fifteen Largest Banks in the
ures

3

of

offered in this nation and

firm

!

for another

reasons

fixity of our
standard monetary unit.
"The various arguments being

against

uation.

valid

pairment

on

dollar deval¬

*.

Electric Utility Industry—Discussion in

Committee

no

Adminis¬

the

Burnham and
Also avail¬

able is current Foreign Letter.

of

National

tration's
—

of gold, voiced

of monetary economists.

by Econ¬

Monetary Policy yesterday (July
16) 58 Committee members ex¬
pressed their
: •.
;
approval of

including chart of atomic energy and
of various atomic metals—Atomic Develop¬

Company, 15 Broad Street, New York 5, N. Y.

Comment"—The

statement issued

a

omists'

39

Monthly investment letter

—

dorsement of expert group
In

_

View

Burnham

Economists

by Secretary of the Treasury Robert B. Anderson, wins en¬

ex-

parties the following literature:

Thursday* July 17, 1058

.

Administration's non-intention to raise the price

Williston & Beane, 115 Broadway,
Mew York City, members of prin-

:ipal

.

Gold Price Policy

on

Landed by

R.

be pleased

Fund, 1033 Thirtieth Street, N. W.,

ment Mutual

The

.

c/o Chronicle, 25 Park PI. N. Y. 7

Volume

188

Number 5760

.

.

The Commercial and Financial
Chronicle

.

(205)

Ira

Haupt Admits

awful

Washington
Ahead
of the News

Haupt & Co., Ill Broadway,
City, members of the

York

New

York

other

Stock

principal

Exchange

and

exchanges,

have

=

A

their

a

One

of

the

de¬

is

that

figure

can'do

you

this

in

Missouri

and

Kansas

politics, he looked around for

without

fields to conquer and in 1936

fear of

any

lionaire part owner of the "Star."

Getting a monopoly in Kansas
City, and becoming an important

newspaper-

ma n

with Alf Landon

new

came

"Post,"

for Willkie

Mr.

desert

the

spondent

be

the

Jr.

at

if

case

boss

a

an

able

but
up
against the great
Roosevelt he looked like a midget.
man

laughed

you

Lees,

and

man

in

Roosevelt

carried every state in
Union but two. I don't know

announced that Ira

industry.

liam

G.

boss in indus¬

of

general

try travels on
dignity and he

better that year so Roy's little
fling at Presidential making was
forgiven.

Haupt II, Wil¬
Carrington, Jr. and Leon
Lees, Jr., have been/ admitted to
Mr.

:

two

partnership

in

firm.

the

Haupt joins the firm after
of service in the U. S.

years

Mr.

Army.

Haupt who was ad¬
mitted to membership on the New
York
Stock Exchange, will ex¬
ecute

orders

for

the

firm

floor of the New York

011

the

Stock Ex¬

change.
The action
makes
the
Haupts the only family to have
three

generations

holding mem¬
berships on the exchange simul¬
taneously. It also marks only the
third time in the 166-year-old his¬
tory of the exchange that a Wall
Street family has gained this dis¬
tinction. Others holding member¬
ships are Ira Haupt, founder of
the

33-year-old investment bank¬

ing
son,

the

firm,

and

Stuart

who

represents
exchange floor.

Haupt, his
the firm on

doesn't

The

the

take
Carlisle

kindly to any
levity towards
him

the

on

nates.

But

and

rare

lishers

part

can

Bargeron

But
back

with

far

who

anyone

could

have

done

any

of his

subordi¬

the

exceptions
between, most pub¬
laugh at themselves

that
Mr.

four

years

again
put

in

home

of

he

was

small

Wendell

over

Willkie's

started with

later

the

group
Willkie.

condidacy

a

supper

actually
party at the

Helen

Reid, who was
along with their reporters.
running the New York "Herald
In this particular instance the Tribune." She looked with horror
subject was about a particular upon
the
candidacies
of
Tom
group of publishers' penchant for Dewey and Bob Taft because she
making Presidents and what their didn't think either one was inter¬
efforts

have

done

the

to

Repub¬

nationalist

enough.
Her idea of
party, although all except running Willkie quickly spread to
one of them is a
Republican.
Henry Luce, Cyrus Sulzberger and
It started back with Roy Rob¬ Roy Howard.
erts of the Kansas City "Star." We
I was right close to Willkie and
lican

know
men

a

few

than Roy.

more

accomplished
Back in my earlier

told him

after his

Philadelphia

nomination

that he

was

in

at
an

of

to their lasts of

corre¬

I
my

He put

a

made

Mr.

the

of

up

the

back

are

I

have

was

them

indelibly in¬
list; of those whom

on my

country alone.

Jones, Kreeger Firm

was

in

To Admit Five

1952

WASHINGTON, D. C. — Jones,
when it seemed that Taft had the
Kreeger & Hewitt, 1625 Eye St.,
Republican nomination in the bag. N. W., members of the New York
I do not know that Palmer
Hoyt Stock Exchange, on August 1 will
and Roy Rogers had any
particu¬ admit to partnership Kenneth P.
lar part in the Texas steal
prop¬ Jones, Marvin E..
Gordon, Oscar
aganda. In any event, it was a P. Ryder, Robert M. Hanson and
shabby piece of journalism. There Kenneth N. Watson.
is not the slightest doubt that the
Texas

Republican delegation
pledged to Taft but at the
minute

a

group

of Democrats,

Forms Syanson Co.

was

last

SEAFORD, N. Y.—Paul I.Gold¬

men

stein

who had voted in the Democratic

primary but
moved in

a

and

claimed

control

Jackson

of

name

the Republican convention. When

they

were

denied they set up the
the Taft
people
had

cry
that
stolen the convention.

is

business

few weeks earlier,

of

engaging in
from

a

offices

and

present he

salesman

holds

of

in

the

1940.

position

the

Municipal
Trading Department.
manager

Mr. Lees started in
ment

the

banking

field
Haupt & Co. in 1932;

This announcement is neither

At

(Special to The Financial Chronicle)

plugged by Luce, Mrs. Reid and
PORTLAND, Me.—Lawrence J.
Sulzberger killed Taft's changes Clemente has joined the staff of
and the trio got their man, Eisen¬ Clifford J.
Murphy Co., 443 Con¬
hower.

gress

offer to sell nor a solicitation of an offer to buy
The offer is made only by the Prospectus.

of

Street.

any

of these Debentures.
^

v

Bond

invest¬

with

$300,000,000

Ira

named
manager of the Institutional Sales
was

United Steel

Department in 1946, and for the
last five years has been in charge
the

of

States

firm's

Municipal Revenue
Buying Department.

4% Sinking Fund Debentures Due 1983
Dated

Scott & Cantrell With

July 15, 195S\
Interest

-

F. P. Ristine & Co.

Due

July 15, 1983

payable January 15 and July 15 in New York City

Philadelphia, Pa.—F. P. Ristine
&

Co., members of the New York
Exchange and other lead¬
ing exchanges, announce that Wil¬
Stock

liam

Powell

Cantrell

Scott

have

and

become

Street,

Price IOOV2V0 and Accrued Interest

A.

associated

with their Philadelphia
South Broad

John

office, 123
registered

as

representatives.
V

Mr.

Scott

has

been

in

the

in¬

vestment securities business since
.1938. Prior to
&

joining F. P. Ristine

Copies of the Prospectus may be obtained in any Stale from only such of the undersigned as
offer these Debentures in compliance with the securities laws of such State.

may

legally

Co., he

was a partner of John¬
Keen & Co., and previous to
that, he was associated with New-

son,

burger & Company.
Mr. Cantrell

was

associated with

•Vertol Aircraft Corp. for six years
before joining F. P. Ristine & Co.

MORGAN STANLEY & CO.

"v

DILLON. READ & CO. INC.

THE FIRST BOSTON CORPORATION

KUHN.LOEB&CO.

K. Medann & Co. Formed
GARDEN
dann &

CITY, N. J.—K. Me¬
Co., Inc., has been formed

with offices at 1001 Franklin Ave¬
nue

to

in

engage

business.

Officers

are

a

securities

Form Security Service
LOS

DREXEL & CO.

GLORE, FORGAN & CO.

EASTMAN DILLON. UNION SECURITIES & CO.

GOLDMAN, SACHS & CO.

HARRIMAN RIPLEY & CO.
Incorporated

ANGELES, Calif. —Secu¬
Company has been

KIDDER, PEABODY & CO.

LAZARD FRERES & CO.

MERRILL LYNCH, PIERCE, FENNER & SMITH

SMITH, BARNEY & CO.

STONE &

LEHMAN BROTHERS

SALOMON BROS. & HUTZLER

WEBSTER SECURITIES CORPORATION

Service

formed with offices at 8230 Bever¬

ly Boulevard, to engage in
rities

,

Jack Kissel,

President; Robert Schwartz, Sec¬
retary-Treasurer, and Kitty Me¬
dann, Vice-President.

rity

BL YTH & CO.. INC.

business.

Officers

WHITE, WELD & CO.

DEAN WITTER & CO.

a secu¬

are

old

Har¬

S.
Sudin* President; Sylvia
Sudin, Vice-President, and Irwin
A. Abrams,
Secretary-Treasurer.




July 16,1958.

■

2234

Clifford Murphy Adds

This story,

an

j

at

Syanson Company.

Mr. Carrington began his career

trader

securities

Avenue, under the firm

in investment

banking in 1936 and
joined Ira Haupt & Co. as a bond

people
certainly

their mark.

blind

nomination

was

these

who have made

scribed

.

group

of

I wish had let the

the first step towards
dismantling
the Republican party.
But this
same

all

But

maimed."

Willkie's

consider

friends and they

men

Its theme

"halt,

running their pub¬
trying to run

without
the world.

to

one

the Willkie train who

ship.

on

first

that Willkie's brain trust

and the

good

a

party today?
said, all except Sulz¬

lications
the

was

Presidential candidate.

don

was

advice

wrote the most devastating article
I have ever seen written about a

such

as

to take the

Luce

recrimination

might

have

were

all of them.

was

as

I

the

on

the Repub¬
lican Presidential candidate. Lan¬

up

As

ation of the Republican
party. The
always at his party would be much, better off
telephone with con¬ today and I think also the
country,
flicting advice. It was impossible if these gentlemen had
just stuck
ver

weie

publishers.
lights of being

laughing about. The pub¬
lishers had their way and where
is k the
Republican

erts and Palmer Hoyt of the Den¬

By CARLISLE BARGERON

Washington news-.] days we were Washington corre¬
sitting around a spondents together, but Roy, in
discussing the foibles of the course of time, became a mil¬

table

Leon

This is what the
newspapermen
were

Philadelphia for a ride to New berger were Republicans and
pre¬
York. They, along with
Roy Rob¬ sumably interested in the
perpetu¬

of

group

papermen

Carrington,, Jr.

bound

was

he boarded Roy Howard's
yacht at

ear

W. G.

he

step on the toes of one of these
publishers.
Sure enough he an¬
noyed Mrs. Reid and Luce when

From

Three Partners
Ira

because

to

'

New

fix

0

;

'

The Commercial and Financial Chronicle
10

.

.

Thursday, July 17, 1958

.

(206)

action
the

Standard Oil Company

Hope

lives

into an anti-recession weapon. Points out that the
growth of highway transportation must be encouraged, not
stifled, and the 13-year program planned by the 1956 Highway
Act cannot be turned off and oh to meet changes in the busi¬

million jobs
and helping to create thousands of new industries, and claims
that if we had adequate roads today 50% more people and
goods might move over our highways. Reviews aims of Federal
Highway Act to save lives, promote economic welfare, provide
for general well being and future growth of our people.

highway plan that will
the road we need now,
and enable us to keep abreast of
the traffic load as it grows in the

^economy.

lias

built

been

America

and

bas

been

no

of

on

our

art,

an

"end of the line."

circulation

ideas
the

and

go

growth of
and

the

all parts of the pop¬
the national life

share in

ulation

preserva¬

with

tion of law and

equality and to a degree

an

before possible.

never

order—all de¬

movement

,

Americans

of

for

our

will

be

on

provito see

faulty

by subsequent leg-

William

Mr.

address

keynote

in his

Richardson,

and
highway
users,
especially the
provisions
concerning taxation. We must be
on
guard, on behalf of the road
program, against any such taxation—even though it is proposed
these

discussed

their

into

of business. America

in

the move once more—

the

If

and the move will be towards in¬

can

provisions

importance

of the road program,

name

the

everything

road

Stanley C. Hope

'America
scribed

relatively

was

little

the

isolated from the
Cities were very compact—

next.
and

of peace through strength, a net¬
the work of modern roads is as neces¬
and sary to defense as it is to our na¬
Each tional economy."

Commu¬

around
church

schoolhouse.

red

community

was

their residents

crowded

were

into spaces the radii of

v

circum¬

uneventful.

and

nity
life
centered
general
store,
the

eat, wear or

we

Nearly

trucks.

which sel¬

Highway transportation as it is
known today provides almost 10
jobs.
One out of every
Americans earns his living

million
seven

highway travel.
Trucks have incorporated the road
could walk in an hour.
into industry's assembly lines. Our
The automobile and new roads
broke forever the close confines highways have helped create

dom exceeded the distance

man

a

in some phase of

thousands of new industries which
Century city.
have mushroomed in the past 30
population exploded
or
40
years.
As suburbs have
into the surrounding countryside.
Scattered
villages were assimi¬ grown, new theories of merchan¬
lated into the more inclusive com¬ dising have been developed for
of

the

The

Nineteenth

urban

munity. The isolated life of the
village yielded to the blandish¬

commodities

the

Americans buy

services

and

and use. In some

the automobile and the
city employment, greater
shopping facilities, and other at¬ highway system have made tour¬
ism the leading industry.
tractions.
America
was
on
the
Yet there are still many prob¬
move.
lems to be met and solved.
No
states,

ments of

And the start of this
too

not

many

remember

in

move

was

I

can

ago.

years

native

city of
Springfield, Mass., tall tales that
were told by early motorists who
attempted to drive from Spring¬
field

my

Albany and were invari¬
ably bogged down on the famous
hills.

over

Farmers

the Berkshire

the

in

neighbor¬

hood, with their horses
reaped
of

a

that

ruts,
a

or

and

fortune

period

And

first

in pulling cars
through the sand

mud if it happened to be

I

development of highway transpor¬
tation has been no exception.

by

train

vividly

to

my

California,

not more than 30 years ago, when
during the month of March the
only transcontinental road that

could

boast

JLincoln

of

such

Highway,

a

was

name,

so

the

bogged

down with mud through Iowa and

Nebraska

that it gave me

superior feeling to sit in

a
a

very
com¬

fortable train and watch automo¬

struggling on
roads
impassible.

that

were next to

address

experience them each

miliar—we

in

day

Every

day.
there

traffic jams

are

downtown,
source

nation

to

uptown,

—

crosstown.

and

of this problem is not

The
hard

find—it is in the fact that

roads have

not

of

hundreds

towns and cities across the

our

kept up with the

by

Mr.

Hope

before the

Seventh -Annual National Highway Trans¬

portation Congress* WaftbingtoB* 0. C.




roads

Inadequate

cause

mated that deteriorated
and

the

lack

large

It has been esti¬

economic losses.

of

highways

parking facilites

add at least $75 million

a

year

to

auto maintenance and

for

motorists
But

alone.

on

not

repair costs
the East Coast

only do motorists

hardships when
highway transportation bogs down
economic

suffer

does

—so

business

and

people

more

over

Just

with

an

as

•

our

civilization

planned-access highways have in¬
creased sales volume by 31%. The

gallon, and
is

highways have cut delivery

same

time 30

to 50%.

over

Taxes

tax.

13-year

equally high,
Nine
people for

result?

The

in

automobile

every

England

—

program

,

construction.

able Fed¬

Highway Administrator, once
stated the effect of the 1956 High¬
Act

way

in very

economy

on our

succinct terms':
demands

"The

program

on

economy are

roads

It

is

t

i

a

a

is not

a

program

n e

d,

highway

the

of

industry and on our
predictable demands!

Construction of the
of

the

ried

Bertram Tallamy, our
eral

network

new

crash

program.

which is a sus-

calculated

undertaking

American

economy

to

a

To maintain this level,
American highway users

high level.
taxes

on

must

be

reasonable

within

kept

bounds.

The

growth of highway
must be encouraged, not stifled as has happened

transportation
elsewhere.

tinued

be

must

user

advocating

alert

con-

^axes now,

taxes

the

in

spend

to

much

so

money
wisely.
The new funds
have to be carefully integrated

into

the

highway

in

program

order not to disrupt the

program

distort its objectives. The decisions to step-up highway spending which have been made will
probably have their major impact
in 1959, or even later. We may be
or

out of the recession at that time,

I, for

believe

one,

that time

The

will.

we

for highways

will have

a

at

negligible

measures may be adopted, and the
carefully-planned highway program discarded in the scramble to
spend the money,
Another shortcoming of accelerating highway spending is that it
does not stimulate directly those
sectors of the economy which are

at high levels of activity.
especially

when

true

This is

they

are

compared to the automobile, rub-

ber, oil, and other industries that
are feeling the recession.
\
It seems to me that all "of us
have a job to do—especially organizations such as the N. H. U. C.
We all must guard agajbast hit and

miss measures which < may be
adopted when the highway program is

siori"

viewed as ark "anti-recesWe must insure that

move.

the original objectives of the 1956
Act are not diluted or distorted
in the public's mind. We must see
to it that the carefully-planned,
scientific program which we all
support — does not turn into a

chaotic crash program.
Finally, we must prevent the
highway program from becoming
a political football. It would be a
real travesty if this bold concept
should deteriorate into a space
age WPA.
The effects of the highway program on our economy are clear to
all of us. American business stands
to benefit as much as the American motorist. The new roads will
help carry American civilization
to new heights. Jobs will be plentiful — during the building and
after construction is completed,
:

The highway program provides

road

program

fu-

..

Plan."

level
period.

-

We

ever

T,

any nation.

lure.

reasonably
At this point, I would like to
throughout the con¬ explore with you another aspect

struction

It

planning

is

timing and careful
takes a great deal

a

steady underpinning to our ecoto* proposals nomic growth.
It is: the biggest

that will carry on at a

high

of

highway

every

additional

unreasonable

or

this

insure

To

growth,;

•

x

attempted by
\

,

^

It is truly a "Grand
1

.

have

all

worked

to

bring

There are4 no of the recent
legislation which has this ' Grand Plan, into- existence.
peaks and valleys in the schedule
;:'been troubling some observers. It
.v
and the result should be a. con¬
is the growing tendency to view'
ea s.upp
tinuing
healthy
effect; on ' the the highway program as*.merely1* benefits we shall derive frcm it.
general economy."
another anti-recession measure. If Let
us
be sure to continue to
Planning for the future is one this
viewpoint is allowed to grow, guard against any distortion of its
of the significant characteristics of
there is-a real danger that the
nnpinai o'niAPtivPc
the 1956 Act. It is a characteristic
original objectives of the highwhich
makes
the
contemplated

1

rt lt ahd welcome the

onginal °ojectives.

highway program unique in the
history of road-building. It is a
factor which should
looked

never

be over-;<

by legislators, highway of¬

ficials and highway users.
The

new

Highway Act signed by

President Eisenhower authorizes

billion

$3.2

spending

on

increase

a

way program may

The highway

eannot

turned

be

highway construction!

wheq needed. /We should, not get
caught in

a

scramble to spend the

newly-authorized funds—a

fully-planned'. highway
which

we

all support.

in the

the national

development of

years

ahead."

off like

la faucet to create additional jobs V;

effect

our economy

will continue to be

Joins Dean Witter

program

and

on

scram-

so

„

in .the

**

Let

we

us

take

the

a

1958

..

program

of

will

economy.

the

.

have

Of

highway

„

.

..

With J. S* May Co.

v.

on

course,

all realize that'the long-range

effects

lng-.

good look at what1Act

'

OMAHA, Neb. — Thomas- J.
Vaughan has joined the staff of
Ofcan Witter &.Co„ Farnam Build-

Federal *ble which could disrupt the care-

in

The President stated at the time of

and

be distorted or

forgotten.

highways have been major factors

adequate road system* so

cars

passenger

planned while in Spain, only one person
by the 1956 Highway Act en¬ in
every 108 has a motor vehicle,
visaged new
modern roads for Excessive
taxation
of
highway
safety, defense and economic users*: in
Europe
certainly
has
growth. These
three objectives helped stifle the development of
called for an orderly, sustained
highway transportation* and has
rate
of
development.
Highway had a
(lampening effect on the
projects require many months of general economy.
advance planning and equally long
I have pointed out earlier how
periods for land acquisition and highway transportation has carThe

50%
might

advances

half of this price

on

in these countries are

industry.

goods
highways.

and

new

signing the bill that "expansion
and improvement of our roads and

If roads were adequate today,

move

♦An

and strains are fa¬

The stresses

nation's traffic load.

remember

trip

about

oxen,

rainy day.

biles

stresses

to

Jacob's Ladder

has ever been
without
certain
and strains—and the rapid
change

dynamic
brought

located near

Businesses

for

reason

stifle the development of

creased

at some time

has

affords.

of

important

most

that taxes depressed. Highways and the conhigh- struction industry generally are

exists

doubt

any

all

to

prosperity for all Ameri¬ way transportation, we have only
use
been hauled by cans.
v to
take a look at the European
The
record
shows
that
new
one-third of all
The develop¬
situation.
In most of Europe we
have
stimulated business, find mediocre roads, relatively few
school children ride to school in roads
ment of a sys¬
Fire engines, police cars opened up jobs, raised land values motor
tem of roads suitable to the use buses.
vehicles,
and
extremely
ambulances roll on wheels and lured new industry into the
of the automobile drastically al¬ and
high taxes on highway users.
area.
In
Boston,
for example,
For example, the average price
tered the shape of the American over our roads.
All of us are dependent on roads Route 128 was built in 1951. Land, of a gallon of regular gasoline in
economy in a few decades.
In¬
deed,
the
entire
structure
of as an essential element of our along the right-of-way, worth $50 Great Britain is 50.8 cents. Of this
$100 an acre, now sells for price 29.2 cents is tax. In Spain
American society assumed a new national defense. President Eisen¬ to
Over $150 mil¬ the price is 57.6 cents, of which
form.
hower has said: "Next to the man¬ $5,000 to $10,000.
lion in plants and buildings have 36.8
cents is tax. The French moNineteenth Century life in ufacture of the most important
been
put up near the roadway. torist now shells out 98l6 cents a
implements of war as a guarantee

that

par-

—

Seventh effect on the economy. Yet, because of these funds, hit-and-miss

the

to

this

recession

additional funds

islation.

transportation system.
But the program also will pay
off in economic growth, for the
every corner

—

these

of

them corrected

highway

nation's

emergency

of becoming

way

sions and that he expected

would

huge expenditures will reach

depend
on roads.
Vital goods and services
are
delivered over roads. Almost
Millions

pend on the
free flowing

plated

a

of

because of the temporary

character

justify the. vast program contem¬

anywhere. Because of

almost

this mobility,

commerce,

Anyone can

The

of

better. Highway Transportation Congress,

annually if highways were
The
safety factor
alone

there

bill

the

planned access highways
will bring great savings in lives,
limbs, and property damages.
Competent s a f e t y authorities
have estimated that thousands of
traffic deaths could be avoided

miles

have

of fighting

type

reasons,

to the taxpayers expenses.
However, the
President indicated that he signed

of

age

so-called

such

aware

are

us

permanent fixtures

mile¬

Additional

of

new

of the highway program

planning.

Most

measures

use

means

several

provisions, the President
set
"unfortunate
prece-

how

a

ticular

the matter

noted,

well as

travel safer as

as

share

own

dents."

the modernization of
will definitely make

efficient.

more

of the

■

-

the state's

cover

These

ahead.

roads

■

concerned

of the cost.

a

highway

Every 24 hours

over a billion
roads. No longer is

travel

they

exception. The

loan to

us

our

On wheels they
school, shopping

people on earth.
go to work, to
and on vacation.

road—

the

of

the foundation

on

that we

Of course,

with sprawling cities
and suburbs, shopping centers and
drive-ins,
motels
and
trailers,
Americans are the most mobile

transportation on our
Every great civilization

Siighway

up

years

Today,

impact of

discuss the

wish to

I

set

give

.

Highstrong anti-reI am skeptical

of headlines about the

voiced by Mr.
Washington's advance of $400 million to
the states—this being in effect a

look ahead and

have taken a long

merely a welcome addition to the
highway program?
1:
The newspapers have been full

Another objection

Eisenhower

this

by

created

program

marks the first time

Act

Credits highways with providing ten

cycle.

ness

The

the interstate system).

on

of

Act," passed by the Congress
the United States in 1956.

program

provision that

makes the government put up two

by the states. This was a radical
change from the long-established

These are
Aid Highway

people.

*

really help get us out of the reces-,
sion, or should they be viewed as

;

dollars for every one dollar posted

tives of the Federal

seg*

every

our

general
way Act being a
growth of
policy of dollar for dollar (except cession measure.
the objec¬

well-being and future
our

f

the

for

:

He didn't like one

welfare,

economic

provide

to

and

assays

our

on

the

promote

the impact of highway transportation on our
economy and issues a warning against (1) levying unreason¬
able taxes on highway users, and (2) subverting highway
Mr.

essential to help
highways, to

action was

save

misgivings and

reluctance.

of

economy.',: ~ 1
q
But what about, the present re**
cession? Can the additional funds

which made him sign the bill with

America's highways.

of

state

This

STANLEY €. HOPE*

Retiring President, Esso

which caused him

where bold, imaginative
had to be taken to improve

years ago

beneficial^ to

be

ment

out certain defects in the new act

several

point

the

reached

ation

On Ou Economy
By

will

roads are not

of Highways

The Impact

Yet in the. same paragraph the
stagnate when adequate,
available. The situ-* President felt constrainted to point

it

does

program

especial to the financial chronicle)

HIGH

POINT,

G. Moore is

now

N.

•

G.—Malcolm

with J. Sturggis

May: & Company, Security Bank

Building.

t

Volume

188

Number

5760

.

.

The Commercial and Financial Chronicle

.

11

(207)
ciation

Is

Management Guilty as Charged?

At

By WILLIAM D. BOWDEN
Financial Relations

In

he

Department, Turner Advertising Agency

shareholders, must

cases,
their

de¬

own

for

continued

growth

of

can

policy better suits his investment

^

;

But, these

however, should this policy no
longer suit him, he should switch
to a company with the
policy he
prefers—not blame management,
as
so" many of today's financial
writers seem to" suggest. •
r

?/('■

p

the

dividends

creased

These writers

\ Shareholder's Responsibility.

i >j V

with

and

i

sheathed

:

';

t O

challenge
_

man

•

to its treat-

as

of

ment
st

oc

with

these

words—

William

is

now

posed to perk

that

its

sup-

bosses

stockowner

with

would

be the only outcome

first

from

his

know

what

he

investment.

does

criticize

not

twain

No

i»vprv

every

case

to

the investor understood and liked

policy

management's

'invested.;
We

before

he

/ ■*

as

An

management and shareholders.
seems
to be a myopic vision that -gives a distinct view of

management, but

a

to

down

from

You

should

investor

in

a

sun

and see
the hill he has

paces

he

shining

the

on

"

ahead

-

does

not

reach

and

the

see

treated badly by the

management of companies

whose

stocks gave them the earnings and
dividend growth seen in our econ-

just prior to the current recession. It is difficult to imagine
shareholders turning against man¬
agement which takes full advan¬
omy

tage
come

,sion.

-

insists

upon

'

:

in

&

one

•

the

and

as

a

investor to

an

executing
lies in

know

ex¬

its

teaching

himself.

If

E. J. Carroll

G. C.

Powell, Johnson Branch

mind
In

as

such

ing^ under

the

management

Criswell Opens ;

—Grover

gaging

C.

in

Criswell, Jr., is en¬
securities business

a

James D. Dopson.

Way.

'v

means

of the Offering

Circular, which should he read prior to any purchase of these Bonds,

v

.

.

,

he should
with such a
change the

originally

:

$22,000,000

fa-

~

Southern Railway Company

-

First
Dated,

Mortgage Collateral Trust 4'/2% Bonds
Due

August 1, 1008
Interest

August 1, 1088

payable February 1 and August 1 in New York City

investor buys stock of

an

company

like

one

of

the

en-

Issuance and sale of these Bonds

trenched utilities, he knows he is

buying

a

are

subject to authorization by the

Interstate Commerce Commission.

solid income stock with

.

"

Are shareholders being given an

honest

view

of

management—or

the producing of scapegoats is
easy way

larity?
*

to recognition and
-

•

the

popu-

dividend—and he feels that
this policy best suits his investyear

ment purposes.

-

-

Price 100% and Accrued Interest

Copies of the Offering Circular

-

Can you

imagine, for example,
This investor has no valid right
in a company like to criticize management in later
American-Marietta looking back, years because he hasn't received a
at 10 increases in dividend income sizable growth beyond the ecojisince -1952—or seeing the value omy's growth—because he did not,
of- their shares up over 16 times make that a criterion of managefrom

1951's value—accusing man-

agement of maltreatment?
Are
shareholders
dissatisfied
the

Minnesota

Manufacturing

Co.

Mining
&
management

•Which h^s- given them more than
doubled
dividends and .a -share
value

since

up more
1952?
.

than three
.

.

times

..

Many such examples can be
 & Haas Co. has ingiven. Rohm



-

.

.come a

shareholder.- '

:

,

.

Qn

the

other

hand,

BLYTH &
when

selects,, for • example,a
company like American-Marietta,
he is buying a record of growth
that surpasses the general econincome

at

the

He selects
time

a

may

any Stale from only
legally offer these Bonds in

:

;

.7

MORGAN STANLEY & CO.
THE FIRST BOSTON CORPORATION

CO., INC.

an

investor.

omy's growth.

he obtained in

may

as

compliance with the securities laws of such State.

.

ment when he first decided to be-

•

with

of the undersigned

such

shareholders

lower

of* purchase

for the probability of a higher future income and sizeable appre-

^
.

-

S

HARRIMAN RIPLEY & CO.
Incorporated

.

:

July IS, 1958..

:
'..

)

from offices at 2503 Pass-a-Grille

Offering Circular. The offer of these Bonds is made only by

an

■

ST. PETERSBURG BEACH, Fla.

FRESNO, Calif.—Powell, John¬
son & Powell, Inc., has opened a

.

.

in

Opens

BROOKLINE, Mass.—Edward J.
growth - minded "investor
isn/t Carroll is conducting a securities
from
offices... at
happy with an income stock, or business
1,731
vice-versa, why blame ananage- peaqon Street. He was previously
ment?
*•.
with Keller Brothers Securities ,Co.

;

V

•

Siegler

CLEVELAND, Ohio — Harry
Krohngold is. now with Edward
N.
Siegler & Co.,- Union Com^
merce
Building, members of IJiO
Midwest Stock Exchange. ...

of

Thiais not

,

:

swimmer isn't happy on skis—
we
can't blame the snow.
If a

■

management that
straddling the fence

suits his in-

;

(Special to Tiie Financial Chronicle). ;

to
on

di¬

direction.1

grief.

'

•

benefit

a

but

'

t

•

Joins Edw. N.

branch office in the Rowell Build¬

nothing

—

i

a

man¬

action-is

can't make up its

C.

N.

'

-■

•

answer

/

Charles
W. Townsend is with Bache & Co.,
Johnston Building.
CHARLOTTE,

manage¬

is doing

of

policies.

The true

the

Actually,

.

whole

job

attack

an

\

;

(Special to The Fin\ncial Chronicle)

of

a

of

\

cases

backdrop
recession
gloom

basis

Stock

investment!

own

Joins Bach Staff

M

company

few isolated

a

New York

his

business in N6W York City.

the

to

ers

mcome
company
such as
American Telephone & Telegraph,
Consolidated Edison, or a similar
entrenched utility, with a growth
company like American-Marietta,
Minnesota Mining, or Rohm &
Haas. Here are two types of comPanies whose managements offer
wMely different policies to the
When

.

Several Examples

Offers

him.

definite policy offers sharehold¬

and
a

conducted

will help the sharehold¬

one

avowed

.

critical

M

New

of the

Exchange. Mr. O'Connell formerly

over

never

Incorporated, 20
York City,

Co.,
Street,

members

one

O'Connell

&

Broad

company

for

Homer J.

..

Blair

point, lets compare

a

growth

.

.

re¬

investor.

which will
of recesafter this period
1 :
.

that

mean

growth potential limited quite
closely to our country's population growth. In the case of AT&T,,
are the critics taking advantage of
he buys because of management s
a period
in our economy where avowed policy of giving a $9 a

;
:

the

of

not

shareholder will

Obviously,

a

he

„■.

plateau

higher

the

only, when

only

voredAs a case

sun

•

were

become

management

It is hard to believe that stock-,

holders

does

rected in the proper

.management continues
those policies, the investor is receiving the factor he bought.
•
,5
inv?stor later decides that

the brightness on
just left—nor does

look forward

This

that

how

Bought

company

another policy better
the valley, he assumes the day is vestment
purposes,
dark—that danger menaces him. switch to a company
He does not look back a few short P°licy — not try to
the

Because

know

as.

hill

a

com¬

suit his investment aims. Then, as ;

-

traveler, who in
country stepped
into a valley.

a

the

lle is ceytain the policies of
blurred view that company s management will

-

across

who

experts

shareholder

Many of today's critics could be

likened

of

'•

are

And

meet

can

cellent

1

.

a

Minnesota

or

management.
ment

agement should be absolved from
all criticism
but, it does mean

and the shareholders. These

the

Recciving What

at

walking

benefit

to run a company

There

J

the

major part of its earnings?

the

the

lies

diversified company

a

temporary
form

can't

.

are

glasses in looking

of stockholders.

for

pany

'.stage of investment writing that
is somewhat like using the wrong
.lens of bifocal

run.

how

to be going through a

seem

the company.

Management
is retained by the shareholders to
exert its brains, talents and know-

wVn>r<*
where

man¬

In

firmly entrenched in
that stresses income

by taking
examples

er

-

«r*Aii0hwi "
."delighted," ir»
in

accept

for the investor.

he

give legal advice—nor
does he blame a lawyer who can¬

But,let's not get the relation-

is

type is for him.

doctor

a

hands

investor wants

an

Marietta

carefully select a company
management
policies
that
satisfy this objective.
He

If they

aiming at a growth greater than
the
economy's,
the
American-

jf

with

who

are -

ownership

shareholders,'

growth, the AT&T's

wants

Then

policy.

If he wants

management
had
to
adjust its
policy at each annual meeting. *
% The investor who wants a happy
relationship with management
must

the

policy with wisdom.

If

must

due

Vice-President of

of

sponsibility for adjusting to any
changes in his personal objectives.

sliip of management and share- not cure a stomach-ache. Why,
Yet, in a personal survey con- holders mixed up. The sharehold- then, should he be critical of an
ducted by the writer among intel- e.rs are fhe owners, and it is their income-minded management that
ligent investors in common stock, right to demand and expect cer- does not produce sizable growth,
comments
concerning 1 manage- fain
results from -management. • or of a growth-minded manage¬
ment ranged from /'contented" to However, it is management's job ment: .that does not pay out the

respect.

criticism

Investors

join in

shareholder's

...

ure

to

become

field,

holder meetings, annual reports
have been made more .informalive, interim reports are more
frequent and comprehensive.
*•» •

and start treaaug

up

a

agement's obligation is to continue

that

vestors are urged to attend share-

management

Bowden

d.

become

company on the basis of man¬

Management could not do a
good job if it had to mold itself
to each shareholder
and fail¬

h'av'e'.views, wishes and demands. :In-/

gauntlet, and

a

and

•

companies they are given
every opportunity to express their

down the

overall

an

agement's

investor

of

management's.

sive

the

kholder.

They
laid

frank and unbiased

company should have a say in that
company.
And in most progres-

agement

will

circum¬

the isolated cases

are

shareholders.

invited

i

seven'

,

their pens un¬

such

Let's boil this down to the basic

Today's most poignant advice
might much better be aimed' at

look at the relationship between
management and shareholders.
It is an accepted (and, in most
cases, welcomed) fact with management that owners of stock iii a

sallied

forth

in

August 1 Homer J. O'Connell

relationship between management
;■

.

a

Be Blair Go. V.-P.
On

management.

—

have

Homer O'ConneH to

justifiable

for

cause

'

Let's take

in /

can't

—not examples of
management as
a whole.
They are not

times,\ "Investor, know thyself"!
v '"poor, undertrodden, unrespected and its share value has more than
In
order
for a
happy union
mass
of investors"
suddenly tripled in the past seven years; between management and share¬
seem to have
gained an army of Dow Chemical has given stock holder to exist, the investor must
'i
v
champions dividends plus
increasing
cash select management with a policy
among invest- dividends,
and share value has that fits his objectives. This is the
ment writers,
doubled in this period.
<
^ investor's
responsibility — not
—

well

serve

the

shareholders

act

they

stances.

to' follow this policy in the future.

he should switch to a company with such a policy
[and]—not try to change the management he originally
favored."
Approval, however, is- voiced for shareholder
rebellion against "straddle the fence" type of management.

American

(if

who have appointed
themselves as
spokesmen for the owners of stock

earnings and dividends. And he
a right to expect
management

purposes,

*

defense

A-M, he wants the man¬ justify getting out of the
company
policy of growth—and and into another with
stronger
prefers having 40% of earnings
management).
Those individuals

back

company's management policies before they become
part owners and now criticize them because those same policies
are still
pursued. Author further contends that "if the investor

•

shares.

investor

has

of

later decides that another

of his

this

paid in dividends and 60% plowed

taking issue with those who find shareholders are mal¬
by management, Mr. Bowden contends it is incorrect
include amongst dissident stockholders those who were

aware

time

on

agement's

treated
to

in the value

the

cides

:

:
,

-

'

■

DICK & MERLE-SMITH

:

■■ ~
'

'

-

r'

C

'

r

FRANCIS I. duPONT & CO. 7 ',.

*

i

"

I

■

)'

*

f

'

;

•
'

.

i1

\

,<«,uThe Comir\erciyLl and Financial Chronicle
12

-.-Thursday, July 17, 1958

. ,

(208)

of

Point

Economy at the Tuning
A. BING*

By RALPH

unlifting forces in the economy and explains why he
anticipates the stage is being set for a "slow" recovery affected
by: further rise in public spending; rising consumer spending
on non-durables, services
and residential building; not too
buoyant consumer durable goods spending; halt late this year
in inventory liquidations; and dragging new plant-equipment
private spending. Looking into the, often described, Golden
60's, Mr. Bing interjects "a few realistic shadings" to support
view that expected growth resumption will not be at the rate
of 1947-57 since it will lack the benefit of the extra impetus
ing and

of pent-up depression and
factors as accelerated basic

of the second

advent

the

be

making

starts

point the sails
Ivrequ ently
flop in

depending on consumer income,
credit, and last but not
least,

credit

While

caution.

new

firmly set.^
downhill

is

The

became

tighter in 1957, the consumer did
more cautious and, above

become

while

a

optimism or

consumer

on

until- all, failed to fall
1958 car models.
course

a

experience

recession

all of which

support
consumer
one
of the major

to

confidence

available

the

cross-wind for

net

as

economic

orthodox

to

expectations,

raising

business, fired

turing

con¬
has been reduced in recent

years,

nothing

are

merely straws

and, as yet, not quite

look
pattern of

conclusive. Let us, therefore,

closely

more

the

at

postwar recession No. 3.
It has
been characterized by three major

21%

risen

from

While

level.

the

this

1954 average

was

about

in

percentage increase
sales of manufacturing

line with the
in

total

and trade, it was a fact that in the
depressing factors: Inventory
face of a growing lack of liquidity,
liquidation, declines of consumer
of consumers-' satiation with dur¬
purchases of durable goods, par¬
ables
and
producers'
satiation
ticularly automobiles, and cuts in
with
capacity, production, sales
private spending on new plant
and inventories on the manufac¬
and equipment.
All three have
turing level had become geared
resulted
from
certain economic
to a non-sustainable level of final
conditions which usually develop

period

prolonged
booming business.
during

a

of

demand.

tional

Economic Imbalances

in

1957

been

a

few

addi¬

im¬

contributing

factors

1st

to

line, and by

Business

portantly to the recession: First,
the rise in union wages, outpacing

Despite sharp profit de¬
manufacturing, the ratio

clines in

of cash plus

U. S. Government se¬

manufacturing
corporations to their current lia¬
curities holdings of
bilities

was

.54% in the first 1958

Total

Net

Building

credit

consumer

were

$21/2 billion, while commercial
holdings of "Governments"

bank

were ■»up

of

serves

$5y2

billion.

member

Free

banks

re¬

(excess

■—

0.2

$—12.9

„

Non-Durables &

Consumers'

$ +

1.7

*f

Buying

Government

0.5

Purchases of

—

Services--

&

Total

out¬

ancy

to consumers' demand in the

next

few

years

it did in

as

in G.N.P.—

at

10.7

$

between inventory liqui¬

•■■Difference
dations

S+- 2.2

Up-Lift

Down-Draft

Net

from its $44.8
billion peak in 1957—not a very
substantial adjustment. Therefore,
consumers' credit is unlikely to
contribute quite as much buoy¬

annual rate of $9 billion

an

first

quarter of 1958, and at a
rate of $2.7 billion in the last quarter
in

the

of 1957.
/

the

climbed
of $3 billion annually.

The

following assumptions seem

reasonable:

past three years when it
average

an

consumer's

the

to

As

statistical

terms.

As

f

is

it

define

to

feasible

hardly

it

durables,

with

satiation

partial

in

know,

you

(1) The
decline
in
private
spending on new plant and equip¬
ment will continue well into 1959
at

rate

annual

an

billion

to

(2)

that, for instance, the car market,

buying

which normally accounts for near¬

of

consumers'
not be

in

decline

resumed.

perhaps $4

billion.

$5

The

however, there is every indication

durables 'will

of

that,

Note

conserva¬

ly one-half of all consumer du¬ tively, I do not assume a signifi¬
rable purchases, emerged in a state cant improvement in the 1959 car
of

partial

temporary
buying

1955

the

satiation

details,

good case can be
contention that the

a

the

for

been

spree.

hand, without going into

the other

1958

levels, below the long-term trend.
With
other
elements
on
the
basic

position

consumer

that

note

to

spending

on

consumer

are

Consumer spending on non-

(4)

durables and services, and on resi¬

building will rise at a
annual rate of at least

dential

combined

from now on, since
is coming to a halt.

$4 billion
recession

almost

interesting

is

it

unchanged,

liquidations

Inventory

(3)

coming to a halt late this year.

made

has
replacement

normal

near

business.

On

ity of commercial banks. From Sep¬
April,
loans

Down-Draft

Goods

2.9

—

,

•;

Total

Service

3.0
0.5
—

Buying—

Residential

Non-Farm

$— 6.3

—

Investments.-.!-

Durable

Consumers'

level of car purchases, so far,

business

Foreign

standing is off 4%

from

tember of 1957 to the end of

Billions*

——

Equipment-,—

<fc

of many consumers.

come

quarter, compared with .51% one
year earlier.
The
Fed's
easy money
policy
has greatly accentuated the liquid¬

commercial

Plant

cycle,

of manufacturing corpo¬
as
well as the banking

position

Inventories

New

of.ymost price levels to decline,
while probably a barrier to an
immediate self-reinforcing down

re¬

to

Ji>f>8—Annual Rate
'

range

"post-mortem"

Quarter,

J

relieve that condition,'-The failure

trend in business.

these

After

off

have

There

Changes From 4th Quarter, S9R7

■

bears
unfavorable longimplications for consumers'
demand levels, especially as prices
What Progress Has Been Made in are likely to continue to inch up
Correcting the Basic Imbalances? over the years, ahead of the in¬

$91.3 billion rations
of 1957, had system.

ventories, at their
peak in September

happened

has

uplifting forces in the econ¬
put on annual rates, shaped
as follows:

up

of many

sumers

thus stalling

and

declines

able profit

Furthermore, total business in¬
far these

the

omy,

To the extent that the

purchasing power

capacity in many fields. Although marks on the down phase of the
business
cycle,
which >'. in
.tern, with data and measurement of "excess latest
some
indica¬ capacity"
in specific
industries eight months had carried the
Kaipn A. Bing
tors continu¬ are quite incomplete, it has been F.R.B. industrial production index
ing down¬ roughly estimated that by .1957, at down from 145 to its April low of
ward and others turning up. The the peak of the last boom, average
126, let us take stock of how
F.R.B. industrial production index, industrial capacity probably was much progress has been made in
at least 20% in excess of annual correcting the basic imbalances.
a rough yardstick for the nation's
industrial
Liquidity has been somewhat
output, turned up a output; moreover, substantial ad¬
ditional capacity was programmed
improved throughout the economy.
point in May from its April low
Substantial inventory liquidations
of 126 and may have gained an and some of it under construction
have tended to bolster the liquid
additional one to two points in at the start of the recession.
So

new

consumer.

a

two-way pat-

in the wind

economy could turn upward.
In
fact, I think this is going to hap¬

May figures showed for «the first
time a slight upturn in manufac¬

sharply aggravating the unfavor¬

market an¬

parade of busi¬ ticipations and by the pressure of
ness indicators
competition, had expanded capac¬
is being re¬ ity way ahead of basic demand,
placed by a thus creating temporary excess

June.

decline
annual

a
an

billion this year

rate of about $31

It may be noteworthy that

mand.

further

of

demand all along the

by over-optimistic

theory,

general and substantial downward
adjustment of manufactures and
retail
prices
initially tends to
accelerate the business decline by

in love with the price

At the same time
on

plans indicate
capital spending to

in

-

replacement
notoriously widespread drastic price declines back to the economic imbalances
postponable, fluctuates widely, during the down cycle. Contrary pertaining more directly to the

At that

wind:

business

$16.6 billion by May; this is a
decline
dollarwise
of
only
2.35%. Trade inventories have re¬
ceded about in
line with trade
sales.
If retail sales continue to
to

demand of such goods,

against the

turn

a

bounce back

pen again in the present cycle. A
order and sales, al¬ rough overall calculation of the
road
blocks to a vicious down though one month, of course, can¬ major factors involved certainly
not establish a trend.
y ;
points toward such a likelihood.
spiral in the business cycle.
This improvement in the in¬
Finally, I sympathize with the
A Prognosis for Recovery
somewhat heretic idea that some ventory situation, conditional upon
sales
support on the
During the fiVst quarter of 1958
credit for the avoidance of a down continued
retail level, naturally brings us the
major
down-pulling versus
spiral is due to the absence of

combined

Moreover,

satiation.

1958, our economy might
likened to a sailboat that just
of

half

more

in the past ten years,

and applied research, and popula¬
growth rate at about 3% annually.

keep average

tion rise, to
With

in

favorable

a

Looks to such

postwar demand.

has

funds,

and

economist surveys the down-pull-

Francisco investment

Consequently, it' is not surpris¬
ing that estimates of the latest

$16.1

of

low

a

availability of mortgage
from around $37 billion last year,
held relatively firm
and that sharp reductions in new
recent months has
trended upward.
Maintenance of at least hold up at present levels, appropriation for such spending
the overall inventory situation is foreshadow further declines in the
consumer spending other than on
first half of 1959, perhaps to an
on the
way toward a better bal¬
durables, despite considerable un¬
annual level of about $27 billion
employment
and reductions in ance, in spite of the temporary
deterioration
of the sales-to-in- or $28 billion.
It should be borne
weekly working hours and total
in mind, however, that this type
payrolls, must be primarily cred¬ ventory ratio bn the manufactur¬
of
capital spending has been a
ited to a partly offsetting increase ing level. Continued maintenance
in "transfer payments," such as of final demand will eventually frequent laggard in business cy¬
and
may
well
continue
unemployment insurance and vet¬ force manufacturing output and cles,
sales up to the level of final de¬ downward while the rest of the
eran payments, and secondarily to
greater

Investment Department
Commonwealth Investment Company, San Francisco, Calif.
Vice-President and Head of

San

payments on FHA
construction, and by a

VA

to

in Marchyv to

billion

stimulatedvby-

down

easier
and

receded

sales

Moreover,

services.

consumer

residential building,

the

(5) Federal, State and Munici¬
spending will rise at an an¬
billion to $4 billion

pal

nual rate of $3

declining from a
reserves
minus borrowings from
in the second half of 1958, as well
productivity, w.as the Fed) have been in a $500 to peak annual rate of $35.9 billion as in 1959. On these assumptions
into profit mar¬ $600 million range for quite a few in the first quarter of 1957 to a the
in
excess
of
spendable income
down-pulling forces in the
and
of
cash flow,
respectively. gins. Second, price inflation (part¬ months, compared with deficit fig¬ rate of $31.5 billion a year later, economy would be reduced. from
ly a result of the former) reduced ures of $300 to $400 million last has recently given indications of
Thus
an annual rate of about $7 to $8
private
indebtedness had
the
purchasing power of those year.
risen fast, with a concomitant de¬
Short-term interest rates bottoming out at this level. I am lionjn the first quarter - of 1958
consumer segments whose income
are from 40% to 70%
below their inclined to conclude that the par-t to around $4 or $5 billion while
cline in liquidity:
From the end
is static or relatively slow-moving. 1957
of 1953 to December, 1957, total
highs, and long-term rates tial temporary satiation of de¬ the up-lifting forces should reach
Consumers as well as

producers

had increased their purchases well

consumer

431/2%
to

credit

consumer

from

climbed

spendable
12.4%

indication

rough
trend
far

outstanding rose

and the ratio of such debt

during the

as

business

to

for
same

is

income

14.8%.

A

similar
period as

a

concerned

can

be found in the fact that commer¬

and

an

array

thrown

the

In the realm of

of

economy

into

a

it not been
for some major supporting forces.
One of the supports was triggered
vicious

tailspin,

had

Russia's
technical advances
loans
rose
49%
to by
and her political
moves
in the
billion, whereas the total
Middle East and Far East, all of
cash flow (net after tax plus de¬
which boosted our defense spend¬
preciation) of private corporations
rose
only 33%.
The decline in ing by about $2 billion in the cur¬
rent calendar year and may raise
business liquidity is furthermore
it by a.similar amount next year.
typified by the fact that the ratio
cial

bank

$40Vi

of

total

ment

cash

and

securities

U.

S.

holdings

Govern¬

to

total

Another
come

important support has
the
continued
large

from

current liabilities of all manufac¬

deficiencies

turing corporations declined from
.67% at the end of 1953 to .51%

cial

by mid-1957.
In addition to a deterioration of

liquidity throughout the economy
other, even more important, disequilibria had developed. During
the boom-time buying spree of
1955 and 1956, the consumer got
loaded up with durable goods to
the point of partial,
temporary
Bing before Loyal
Knights of the Round Table, San Fran¬
cisco, Calif., June 26,- 1958.




to

mand

20%.

top-heavy

man¬

ufacturing inventories, sharp ad¬
justments have been attempted:
These inventories declined at an
annual rate of
the

fourth

the

decline

annual

first

rate

five

over

$2y2 billion in

quarter

of

1957,

accelerated

of

$6

months

billion
of

1958.

and

to

an

in

the

From

their

September, 1957 peak of
$54.2 billion, manufacturing in¬
ventories
came
down
by
$3.2
billion, or 5.9%, in May of 1958.
However, during the same period
manufacturing sales had declined
roughly
by
a
similar
dollar
amount, representing 11% of the
September, 1957 sales of $28.2

of things called "so¬
capital," such as highways,
schools and hospitals.
As a con¬ billion. A sales decline that, per¬
sequence,
state and municipal centagewise, is faster than the
spending is going up another $2 inventory liquidation, is not un¬
billion to $3 billion this year, and usual on the
manufacturing level
in the early phase of a recession.
may do the same next year.

Thirdly, the consumer, while
reducing his buying of durable
goods by an annual rate of $3.5
billion in the last quarter of 1957
and the first quarter of 1958, actu¬

his overall spending in
that period by only $2.4 billion,

ally
•An address by Mr.

15%

declined

have

Sustaining Forces

imbalances
depressing forces might easily

have

or

after

—

steadily

Some

Such

durables

in

increments

cutting

cut

-

Whether

an

initial

inventory

imbalance has been

really aggra¬
vated should be primarily judged
against the trend in final demand
the retail level.

Here the pic¬
reassuring:
From their
monthly peak of $17 billion last
on

ture

is

.84%, due tp increased buying -August, seasonally adjusted retail

for

to

ceased

consumer

be

an

durables

has

actively depress¬

ing factor in the economy.
least

The

progress

been

has

mad^ in correcting those imbal¬
which

ances

affect

private

busi-i

on new plant and
This is not surprising,
since
the
primary influence
is
elimination
of
excess
capacity
which is naturally dependent upon
the
relatively
slow growth
of
basic demand. However, the fur¬

spending

ness

equipment.

which

deterioration

ther

threat¬

ened last year

the

by

has been mitigated
curtailment or postpone¬

ment of numerous

in

ects

minum

the

the
and

other

chemical, paper, alu¬
other industries. On

hand,

squeeze on

been

expansion proj¬

the discouraging

margins has, of

course,

aggravated by the decline in
from the reces¬

volume resulting

For instance, the aver¬

sion itself.
age

net profit margin of manufac¬

turing companies declined to 3.4%
in

the

first

quarter of 1958 from

4.7% in the third quarter of 1957,
and 5.1%

in last year's first quar¬

an

Thus the stage
would be set for a slow recovery.
initially.

that

When

re-inforced
of

up-lift

inventories,

the

recovery

will

This is likely to hap¬

accelerate.

sometime in 1959.

pen

the

to

contrast

In

1954

re¬

which was sparked by a
in
private capital equip¬
and
consumers'
durables,

covery

boom

ment

ernment

of
declining Gov¬
spending, I view the im¬

pending

recovery

face

the

in

partly

on

a

spending;

one

as

relying

further rise in public

spending on

consumer

is not likely to be

durables

very

sometime, -and the
trend in private spending on new
for

buoyant

equipment

and

plant

will

be

a

drag on the economy for a while.
Incidentally, t0[ the extent that the
recession
a

halt

Months

now

to grind to
derided "Six

seems

much

the

Club"

still

may

prove

right!
It

is

to sketch into
of the economic

customary

the

picture

a

porarily reduced.

Golden

60's

-

eventually

is

by a re-accumulation

Moreover, upward pressures
in wages have at best, been tern-'

ter.

to $8

annuald rate of about $7

billion

background

few

hints

when

a

about
new

the
tidiil

/

Volume

188 '

'. '1 The Commercial hhd Financial Cht6nicle

Number 5760

(209)
of

wave

marriages and babies is

l^,tbed?asis

expected to
boom.:

new

this

erase

Far

be

it

attractive

As Investment Bankers

the horizon, but I want to sup- >.
plement it with a few realistic

shadings.

First of all, the longgrowth in the 60's will lack

depression

and

postwar

the

late

early 50's benefited.

applied research.
to

The

On the other

will

offset

basic and

other

but

decries

should be borne in mind that the
net result

in

might be

1958

reduction in

a

the 1947-1957 economic growth
to
something closer to the

about 3%

average growth rate of
annually.

hart's Bill

S-3718, which calls for accelerated depreciation
property acquired or constructed during 1958-59.

Secondly, the stimulus of sub¬
stantial

60's

population growth in the

for

markets

our

is

assured*

mu

(barring

a war catastrophe). How¬
it should be borne in mind

ever,

that only an

put
raise

the

next

the

seven

The

at

as

future

.

.

is

the

level,

of

,of

national

These

heard.

in

depreciation

1958 and

/

of

on
property
acquired
during
The proposed bill

or

1959.

,

provided for faster recovery dur¬
ing 1958 and 1959 of the cost of

our

capital

new

goods

through

de-

,

number

than

the

that

ones

ability,

fur-

same

condition

will

also

favor

a:

continuation of the so-called costlabor

unions

a

very

-

-

vided
•

'

5

,

p.pusii)ess^ ae
cline is

gaining position.

periods,

Vui'greatest

push type of inflation,

by giving
strong bar-

.

provide
#8gressive
leadership,

nish the bulk of labor forces. Th is

trend

for

continued

cost-

inflation, combined with
toward

further

credit

a

in¬

flation—resulting from seemingly
interminable

domestic
not

international

political

augur

very

—

tends

to

create

nomic system which

are

a

a

eco¬

handi¬

for genuine growth.

This is not to write off the 60's
as

a

good

prospective

period

business

simply to

keep

of

the

go

than

levels,

present

time

is

mediate: funds for

new

anc|

national

manufac¬

turing plants and equipment; for
purchase
of
farm
equipment,

an

making

have

of

jn

or

matters
com¬

opinion and
should

policies

issues in

special

be

which

on

cer-

which

we

we

our

and

a

ness

should

be

firm stand,

even

on

.

and

thus

damaging

By this very
surrender the right

to

speak out

on

matters which

I

can

on

our

.

First

from

personal

headquarters

do it.

to

let

the

in

the

sibilities to

of

one

(Special to The Financial Chronicle)

monte

and

with

now

pany, 10

James

B.

Randle

MelvffT Gordoit

Pines

This

ization
that
resumption of the
economy's growth depends on wise
fiscal policies and more freedom
for

business

At

the

make

to

announcement is

' A*

•

With Continental Sees. ^
(Special to The Financial Chronicle)

GRAND
T.

RAPIDS, Mich.—John

Conklin

is

Securities Co.,

with

Continental

Inc., People's Na-

tlon£d Bank Building
Joins J. H. Goddard

demand-

is only

other

fellow

However, I believe,

as

BOSTON,

Hanson
J.

H.

has

Mass.

Goddard

Devonshire

—

joined
&

Street,

Arthur

an offer to sel l nor a solicitation
of an offer to
The offer is made only by the
Prospectus.

of

Co.

Inc.,

85

members

of

buy these securities.

jobs.

couraging to witness the tendency

Burroughs Corporation

recession by hastily devising plans
more
Federal
spending, or

for

J. P. Dunklin

TEXARKANA, Tex.—James P.
from

offices

at

the budget.

2804

Wood Street;.

of

As

the

effect

example,
one of those bills, which is harm¬
ful; to our industry and to our
economy, is the Community Facil¬
ities Act of 1958. It has passed the
upon

Dunklin is conducting a securities
business

regardless

loans,

Opens

Senate

and

chance

it

it

there

will

is

an

a

very

$25,000,000

good

4%% Sinking Fund Debentures, due July 1, 1983

the House. If

pass

does

pass the House, as pres¬
submitted, the Administra¬

ently

Price 100% and Accrued Interest

tor of the

Housing and Home Fi¬
Agency can purchase the
bonds of, or make loans to, statesand municipalities, up to an ag¬
gregate amount of $2 billion to
finance the
construction, repair
and improvement of public facili¬
ties, at an interest rate of approx¬
imately 2%%.
nance

550,058 Shares
Common Stock
(Par Value $5)

Had this bill been in effect dur¬

Advertising

is

one

of

the most useful tools in

ing the first five months of 1958.
75% of all municipal bonds sold,
excluding state and school bonds,

Subscription Price $27.50

eligible for Fed¬
purchase.
In
this means that $1,218,000,000 of the $1,665,000,000 in
bonds
sold in January through
May would have been eligible.
We feel sure the Community Fa¬

Stockholders, subject to the terms and conditions set forth in the
Prospectus. Subscription Warrants will expire at 3:30 P.M., E.D.S.T.,

Government

dollar terms,

securing
So

it's

new customers.

to

smart

place

cilities
some

your

advertisement in

the

Act

of

1958

form, and it is

President

did the

will

Harbors

will
our

veto

and

Share

The Company is offering these shares for subscription by its Common

would have been

eral

per

on

July

30, 1958.

Stock pursuant to

The several Underwriters may offer Common
the terms and conditions set forth in the Prospectus.

Copiers of the Prospectus may be obtained in any State only from such of the several
Underwriters, including the undersigned, as may lawfully offer the securities in such State.

in
hope that
it, as he
pass

Rivers Bill.

Lehman Brothers

Approves of More Rapid Depre¬

Blyth&-Co.,Inc. The First Boston Corporation EastmanDillon,Union Securities&. Co.

ciation in Legislation
There

is

another

pending bill
which, in my opinion, would en¬
courage spending throughout our
of the kind

economy

THE COMMERCIAL AND

create

further

FINANCIAL; CHRONICLE

lasting

jobs
expansion.

that

Glore, Forgan & Co.

Senator

Capehart's Bill, S-3718, a
new jobs,
giving greater stability to and im-

Harriman

/

Kidder, Peabody & Co.

| Smith, Barney &. Co.

Lazard Freres & Co.

Merrill Lynch, Pierce, Fenner & Smith

Stone & Webster Securities Corporation

White, Weld &. Co.

bill which would create

25
«

<>

Park

Place, New York 7
.

j

L

Dean Witter & Co.

A. G. Becker &. Co.

.




*From

a

Incorporated

talk

by Mr. Jackson before
Group Conference, Invest-'
ment
Bankers
Association
of
America,
Santa Barbara, Calif., June 30, 1958.
the

California

Ripley &. Co.

Incorporated

would

and
assure
I refer to

Goldman, Sachs &. Co.

»

if

July 17,1958.

W.

staff

moment, it is most dis¬

in Congress to combat our present

!

the

in- the Boston Stock Exchange.

neither

>

are

Cora-

Road.:-E..\

"

our respon¬

bring about the real¬

Trust

REVERE, Mass.—Ralph C. Bel-

experi¬

tools; for renovation of retail and ing. I know, too, that it

of

Corporation,

Two With Melvin Gordon

association work

be burdensome and

Vice-President

(Special to The Financial Chronicle)

trade

natural

busi¬

Company of Georgia Building.

>

that

other types of capital investment,

future

our

mine.

yours and

.

Southeastern

with

us,

know

wholesale stores and hundreds of

the

make

behalf

own

tvitally affect
business, and our clients.

ence

for

must

we

assistant

an

issues

customer relations.

our

good

industry

Only

Elects F. LMallil(in

which directly affect our welfare,

we

toward
to

sound

ATLANTA, Ga. — On July 24
Fred L. Mullikin, Jr. will become

many times we avoid tak¬

controversy

possible

and

atmosphere

That

,

ing

to
as

generations.

busi-

working with other business asr
sociations against political trends
harmful to business in general. j
Too

then

devote

to

.

by so doing can
we preserve the
good in what we
have, and leave a healthy climate

competence

because of the nature of
ness>

.

contribution

a

government

policies.

.

as

has

end, I have advoAssociation formu¬

sponsor

attitude,

up
recovery of
make
available im-

our

tain

time

capable.
I believe it is

expectations

our

now pro¬

stepped

would

To that

either

sort

our" views

jate

prosperity of which this country

but

down to earth.

to 15 years,
depreciation.

transportation equipment,machine

required to resume
general growth and to regain the

very

conditions

not

much~lower°
but

W. C. Jackson, Jr.

which

should

Continued

number of imbalances in the

cap

do

well for the sta¬

bility of price levels.
price inflation

and

pressures

depth,

up

for

Such
cost

:•

-

not its

Prospects
push

aVlo^e

reduce'by

who

....

industry

much

and

....

First Southeastern

Association is

express

cated that

the

the

our

which

on

.

economy

which

,

.

are

which

petent to

on

.

econ¬

nation

our

inside and outside

Congress.

on

to come, by permitting more

constructed

population—the integrity,-"vi¬
sion,
intelli- ;
very young
and the very oldg e n c e
* and
will continue to increase faster in
brackets

the

rapid

men

,

anything

our

.

to

our

Views

....

upon

relatively

few

.

tax rates,
to halt the present

dividuals in industry, we have an
inherent responsibility ;
V first

Association Urged to Formulate

months, with resultant expansion
years

age

,.

income

been proposed
of

proving existing jobs, and stimulate business during the' next 18

economy

our

a

national

.

of

depends

eight

or

unproductive

well

as

living standards.
The
improvement in productivity will
have to be substantial because,
during

,

...

the

years,

'

„

of the hour

informed, articulate business
leadership
at the local level,

will

worked

.

crying need

for

increase in the out¬

man-hour

per

.

lae

across-the-board

an

in

more

than

of

type of legisla-

recession and stimulate
omy

Community Facilities Act of
had it been in effect would have made

says,

plus.
f

75% of $1.7 billion municipals marketed—excluding state and
school bonds—during the first five months in 1958
eligible
for Federal purchase, and
heartily approves of Senator Cape-

rate

long-term

which, he

through

constructive

tion,

U. S. Senate approved

products
research,

new

convinced the enactment

am

would do

take
affecting business, cus¬
and industry policies. Mr. Jackson

tomers, good government

it

available

reduction

and national level and fcr investment bankers
group to
a firm stand and
speak out on matters

It is impossible

each

I

"crying need of the hour," according to investment bank¬
spokesman, is tor informed, articulate leadership at local

ers'

predict exactly how these fac¬

tors

made

this

the

hand, the 60's should benefit from
the results of accelerated

industry to turn out

President, First Southwest Compay, Dallas, Texas
President, In vestment Bankers Association of America

demand

40's and

spending would
key to permanent

lete equipment with new
facilities,
thus
reducing costs and enabling

By W. C. JACKSON, JR.*

the extra impetus of pent-up postfrom which

of

recovery from the recession.
It
assures the replacement of obso-

lining

on

term

type

appear to be the

to

me

silver

This

.bdgtVA f^

far*a

for

13

14

The Commercial and Financial Chronicle

(210)

.

.

Thursday, July 17, 1958

.

mortgage market is influenced by

Fixed

Fiee Interest Rates

vs.

For FHA and VA

:

Federal

Mortgages

pete

Economist, National Association of Mutual Savings
.
New York City
v 1

r

;

Former Federal Reserve Board economist sees

v

fixed

interest

economist for savings

bank

v

accen¬

topic. It is easy
hardly neces•sary for me to
prove r to
an
experienced
group
of
bankers

is

it

because

ac¬

econ¬

the

have

butv through ensuing
changes
in • interest : rates
and
inoney,

ship does, infact, exist; and

yields, influence the flow of funds
financial

all

in

difficult

Thus,

sectors.

at

former location in

a:

manifold

plahts at' Putnam and Grosvenor-

investor

-VirVi' *)*>".< '*!■ >C-•'

■

ease,

Klaman

market operations are clearly af¬
of this rela¬
tionship would require more than fected by System actions.1
one talk. Compromising the easy
Monetary policy is usually at¬
end the. difficult, therefore, I will tuned
closely to general business
limit my remarks to a summary conditions, it is generally restric¬
analysis of what appear to be the tive wh&n inflationary pressures
most interesting and important as¬
are
threatening
and expansive

relationship

among

the various sectors of the

of this

market

pects

the

and

financial

institutions

framework, I would like

to offer four main thoughts;

(1) The Federal Reserve System

a

function

of private

competi¬

tive forces.

(2)

The

dominant.

inflation

and

inflation,

of

funds,

are

measures

deflation.
under

interest

ernment

local gov¬
lim¬

more

11 y;

c o s

under

and

mortgage deflationary conditions to make
monetary such funds more
readily available
policy is intensified by a structure
at reduced interest rates and on
of inflexible interest rates in the
markets

of

on

in

Federally underwritten sector.

favorable

more

bor¬

to

terms

There have been important rowers.
in mortgage
market
The
actual
allocation
of
the
behavior between savings banks
available supply of funds within
and other types of financial insti¬
the money and capital markets is
tutions during periods of monetary
change. Moreover, reflecting a function of private competitive
changes in other special factors, forces, and not of central mone¬
(3)

differences

cavings

reacted

dif¬

tary policy.

Federal

similar

to

actions

serve

have

oanks

ferently

Re¬

jective,

in

taken

different

periods.
,(4)

now

the ob¬

of the Federal Reserve

power,

System to

particular

mar¬

The present composition of kets. Individual lenders and bor¬

folios

banks' /mortgage

that

suggest

they

sensitive to monetary

than

those

of

other

nancial institutions.
addition

to

port¬

may

more

types
-

-

these

.

observations
recent

and

ments in

of

fi¬

the

Federal

carries out its

Reserve

money

Because of

uses.

some

of

develop¬

policy

over

influence

in

this

the

reserves.

To

Monetary

monetary
is. unique

a

large

of

sector

and
cent

an

excellent

residential

discussion

of

this

related

points, I refer you to a re¬
speech
by
August
Ihlefeld
on
Institutions and Monetarv Man¬

ih

tion

of

Massachusetts, Bos¬

fr!n»ed

1958.

cial

Mutual
»•»

of

before

the

National

Savings

"The

chronicle" of

the 38th An¬

Commercial

May 15,

and

1958.

and

re-

New

York

opportunity for officials
plants to become ac¬
quainted with one another. New
companies
represented
at
the
meeting included: Eagle Pencil
Company, Kimberly-Clark Corpo¬
ration, Reeves Souiidcraft, Scovill
Manufacturing, Manning, Maxwell
ing

an

the

of

new

and Moore, Consolidated Controls,
Control Systems, Inc., New-

Data

Exploration, Limited, PerCorporation,
Wilmot

kin-Elmer

Cassidy Company and Howe Fold¬

Textron, Inc. Offering
Made at $9.75 a Share

t

City

to

*

.

interest rates

Federally under¬

on

written contracts and flexible

other

yields

on

bonds.

The flow of conventional

corporate

funds,

and

the

other

hand, has fluctuated Within

a nar¬

mortgage

row

range,

with

The

developed will be done by other
adjust intcrest
diyisions Of United iand by sub¬
in accord¬

changes. in

contractors

TT

s

rates

arises

effective

the

over

yields

has

these

on

Tamiiiatos

Inc

a

new

in

mort¬

cabinets,

table

nates

Other

tops, counter tops, bathroom van¬
ities and allied products.

bearing

securities,

market

fixed

contract

of

rates

interest, typically trade at prices

yield flexibility.

only

l.vv:;,,.':-

below par with resulting

or

placed

answer

lies

the

in

partly

strictions

The

Federal

re¬

on

discounts

for

kitchen

gages to actual market conditions?
capital

on

<1i /

Control
pany,

been

of Colt's Plastics

Com¬

North Grosvenordale, has
purchased by a Rhode Island

group from
tion. Colt's

Penn-Texas Corpora¬
Plastics which had a

1957 sales volume of about $2 million was a division of Colt's Patent
in Firearms Company when acquired

FHA and VA loans, ranging from
those

uncertain

of

legality

earlier postwar years to the rigid
controls

in

effect

for'a

time

in

by

1957 and 1958.
;

in

lenders

Part of the answer

the
to

unwillingness

of

widespread

practices

of

answer

but

market

the

a

after

hilities assumed and before the

1U^niir^hase

S

^on

wppp

immoral

forces.

scope

severely limit

mortgage
the

on

Its product lines con^. v
principally of cold heading 4
and cold forming machinery, roll-V
ing mills and related equipment, ;
eyelet
machines and power.sfj
presses, and wire flaRening and ^
drawing equipment.
r
;:
machinery.

Textron is

a

diversified

manu-

company

em.Connecticut community where . ivtachinery and capital goods. Tex- ;
it-is expected to continue to op- /tron is also engaged, through a
erate. ' ;';
'
7
5
- ; /subsidiary, . in, operation
of .the;;
..

,''.x

*

*

-

•

v ;

,

passenger

liner S. S. Leilani. Thei j

Shephard
&
Sons Company's business is carried on,\
Company have announced plansH:through divisions and subsidiaries'^
for a 40-acre. industrial park in which operate autonomously.
George;

A.

CH AS. W. SCRANTON & CO.
,

Members New York Stock

Exchange

effec¬

mortgages.

New Haven

New York —REctor 2-937?

stability

of

the market for .conventional than
for Federally underwritten mort-

Finan¬

Continued

on

page

24

1

with a wide
range of industrial and consumer •
products, including textiles, power T
chain saws, plastic products' cast- \
facturing

FHA and .VA

greater

•

sist

paper,

restrictions
on

J

annrnv1;'

The. full

this

of

Federal

J

of lia- J.*

deduction

myriad of factors

pressures

much

p*,ri.Pi

quired from Waterbury Farrel by

tiveness of discounts in achieving

The

irv

Co/

notwithstanding the

lies in

clearly

lenders

-

that such

opinion
somehow

are

unsavory,

facts

LK

w

Waterbury Farrel Foundry ;
Net assets ac_-4.,

MacMne

Penn-Texas in 1951." It later ings, metal fasteners, aluminum
a
separate company and ;products, batting, bathroom acri«
moved last year to the east-'v cessories,
electronic equipment, •

in the face '.■■C

FHA and VA loans,

or

of

accept large discounts

on

/

V'

became
was

lies

;
p

jjjwc,"! WW,500 w^e

not

years

>.

Sigourney ToolSCompany. which
recently
moved
to
Bloomfield.'
Textron also furnished funds to
The
multi-story
plant
includes
discharge $300,000 in short-term ;
50,000 square feet of manufactur¬
bank
borrowings
of Waterbury ,.
ing space.
After renovating the
Farrel assumed by Textron.
interior and installing new equip¬
Waterbury Farrel is engaged in,/
ment the new company will pro¬
the manufacture of metal working
duce high pressure plastic lami¬

VA

paying

of

premiums

or

adjusting

and

FHA

on

technique

the

discounts

above

-

f

&

has purchased the plant
in Hartford formerly occupied by

despite fixed maximum

why,

y.

allotment, ; out

to

Textron,

financial

question frequently

loans,

Manufacturing:
Manufacturing of products

vision.
vision.

least,

at

jcct

company,

interest

been

to

other terms

rates and

of

lenders,

as

been free

have

on

/

if-,

of any ~j:
lias formed a Missiles and Space shares not subscribed for. Rights ;
Systems Division, whicn will de- wiu expire at 3:30 p.m. (EDT) on "
yote itself to research and devel- Jlily 30> 11)53.
An underwriting
bpment work. The lynv Division gro up headed by Blair & Co; In-.
Started with a nucleus of 300 percbrporated and Scherck, Richter '
sons, including 200 scientists and
(y0
wm
purchase
any
unsub- :*
engineers from the Hamilton gct^ shares.
i"
Standard
Division s
Electronics
proceeds from the sale oi
Department. A number of other
shares will be- used to re- [4
technical employees
o r m e r 1 y d UCeshort-term bank borrowings
;
working on a. variety of missile p^un-ed in part in financing the..
projects in other divisions will
acquisition on June 28, 1958, of "
also be transferred to the new DiDi¬
^1C as«ets properties and business /

Associa¬

Banks,

by the Danbury Chamber of Com¬
for the purpose of provid¬

merce

-

.

"Thrift

nual Conference

foot

building which has recently been

ing Furniture Company, w:

companied by exaggerated swings r :ryThe United Aircraft

yield flexibility
1 For

square

Textron, Inc. is offering its comthe new mon stockholders of record July
plant in September. Employment 14, 1958 rights to subscribe at
tive to investors.
will bey about 200, engaged in $9.75 per share for 389,577 adT
j
Thus, alternate easing and tight¬ manufacturing a variety of dental ditional common shares on the
Instruments 7Including the high- basis*of one additional'share for
ening- of monetary policy and
speed page drill.
•each ten shares held. They also
capital market conditions .during'
j;
,
V . are being offered rights to sub1
'
scribe for additional shares, subthe postwar years, have been, ac¬

and moral

Measures

the

76,000

a

.U;'.

•>

:

_

beyond

Owing mainly to the fact that

agement," presented
♦An address by Mr. Klaman before the
£8th Annual Trustees Day of the
Savings




of

area

capital markets.

among

System

by regulating the availability and

ton, Mass., June 12,

char¬

Vulnerability of Mortgage Markets

and credit

cost of commercial bank

43anks Association of

special institu¬

arrangements which

the

ever,

Considerations

trusteeship

supply of

loans»■and

investments determine in the end

tional

...

course

prospective

Policy

for

thoughts I acterize mortgage markets, how¬

mortgage markets.

Monetary
The

about

be

competing

rowers

change the types of credit flows and their

would like to conclude with

total

It is not

is it within the

allocate credit to

savings

In

nor

v

poration is building a new 26,000

and

rates

loans again become attrac¬

gage

mortgage

and

investments,

and

•;

square foot plant near the Danon alternative investments v bury airport. The Company plans
declining, FHA and VA mort¬ to move from its present location

They do
conditions markets.

well as funds for cor¬

as

'i*

pro¬

Chayejs Dental Instrument Cor¬

1958, when funds are

and

ance

make

to

porate and state
ited

impact
changes

Monetary

tend, -however,

is concerned with the total supply
of money and credit. The alloca¬
tion of this supply among markets
is

forces

deflationary

alone cannot contrdl the forces of

which operate in it.
In this

when

to

the other hand, such as

on

.

B.

Saul

end intricacies

The site is *

Danbury.

near

adjacent

mont

funds. dale, where it will continue
During periods of capital market duction of heavy threads.
limited

panies, are not directly regulated
increasing spread between fixed
by
the
Federal
Reserve,
their

ramifications

Roxbury, Mass¬

achusettsto fts parent;

in compet¬

disadvantage

for

so«-called
"non-monetaiy
intermediaries," such as savings in Federally underwritten mort-n
and
loan
associations,
savings gage, flows. These shifts/haveCo¬
banks and life insurance com¬
incided. with the. narrowing, and
while

because

adequate
exploration of
the

in

most direct effect, of course, on
the
flow
of
bank
credit
and

a

borrowers

mortgage

distinct

judgment of the

operations

These

omy.

recently purchased by

was

contracts yields

fluctuating

a

which

.

place

are

cordance with its

credit needs of

basic-relation¬

is

and

con¬
v

1953-55 and

reserves

Bethel

„

General Thread Mills Company,

tracts, in the face of rising yields Belding
Hemingway
Company,
on
other, loans
and* securities; has moved its operations from its

in rediscount rates
requirements, the ample

expands

as

underwritten

Federally

on

reserve

commercial bank

by increas¬

areas

1956-1957, fixed interest rates

ing

changes
in

surplus

1951-1953. ards and specifications,

stringency, such

and

open market purchases
sales of Government securi¬

and

in labor

ing their knowledge of military
requirements, procedures, stand¬

mar-,

ket

Through

System

/:

and

trustees that

it

During periods of capital

local lenders.

tary policy and mortgage markets and
Is at once an easy and a difficult ties,

of main¬

mortgage and real estate sector.

market could be reduced by permitting free interplay of market forces to set the price of
Federally-insured and guaranteed mortgage as in the case of
conventional mortgages.
States time now is propitious to
change to flexible policy. Praises legislation allowing interstate
savings bank lending lot making savings banks important
national mortgage lenders without lessening their still signifi¬

The relationship between mone¬

In

impact of monetary policy

the wide swings in mortgage

cant role as

Exhibit of Busi¬
ness
Opportunities, sponsored by
the
Connecticut
Development

and has intensified the tors. The objective was to assist
manufacturers
and
businessmen
on the

processes

impact of monetary policies on

inflexibility has interfered with and inten¬
sified allocative functions of free market process; and believes

,

July 9th through the 11th

England

interest rates on
FHA-insured and VA-guaranteed

that interest rate

'

New

a

fixed

taining

Mr. Klaman traces

group,

policy

the

particular,

flow of funds into
Federally-underwritten and restricted mortgage market; notes

tuated

the capital market.

From

converted from tannery manufac¬
Commission, was held at the State ture to a warehouse. <
Armory in Hartford. The exhibit
showed many items purchased by
The
Danbury area which has
various
Federal
Government recently been the scene of con¬
loans has interfered with the allo¬
agencies and by its prime con¬ siderable new industrial additions
cative function of free market
tractors and principal subcontrac¬
recently held a dinner sponsored

Bank

virtue in
Now an

no

for FHA and VA mortgages.

rates

v

have participants in other

as

sectors of

By SAUL B. KLAMAN*

lenders and borrow¬

have not been as free to com¬

ers

Connecticut Brevities

statutory and administra- V

tive actions,

Hartford—JAcksoo 7-2669
..

Teletype NH 194

Volume

Number 5760

188

.

.

The Commercial and Financial Chronicle

.

(211) ,15

'

j/'

4

y^a^'metalsoiking inIn forgmgs dollar volume vs.'
Second, some of you at least
sales of $140 metalworking sales, we show the have been designing weight out
billion.- By, 1965, metalworking's commercial' sales by
the
drop of your forgings. And that cergross sales, in terms of 1957 dol- forging industry in terms of the
tainly is good.
■ .y*1??, :'^ift^is? 't° $196
billion** By 1947-49 base, as compared to total
Perhaps there are other ex.■
1975, they will be $273 billion, in metalworking industry dollar
planations for your relatively good
terms of 1957 dollars.
sales. On a dollar sales
basis, you showing in dollar volume and
For % the long term, the pictuie cippesr to be doing well—at
least, your not so good showing in too—
is extiemely optimistic. Soon after to be
slightly more than holding nage. Perhaps you are satisfied
the turn of 1960, we will be lookyour own.
I. cannot help but be a little
/ ing back at the middle '50s and
concerned over the irregular levr
wondering how we ever got along.
Drop Forging- in Tons
eling of your tonnage output dur¬
Drop Behind '
/
New. Capacity Needs for 1969
ing a period in which the metal¬
But
let's* take a look at the
working industry generally and!
It means that in the early 1960's
physical measurements,

:

^<^dpstry.. had gross
^

By WALTER J. CAMPBELL*
Editor "Steer': Magazine,

Survey

of

metalworking

plants'

Cleveland, Ohio

business

.

by

expectations

"Steel" magazine furnishes the summary view that the reces¬
sion has bottomed out, or soon will, and a gradual
though

-

modest recovery

will start late this year and continue through
metalworking records being established. Leav¬
ing this overall view, Mr. Campbell probes what has hap¬
pened to drop forging's competitive position.f The magazine's
editor notes that drop forging is doing poorly,
tonnagewise,
though it is still doing well, dollarwise. He depicts tremendous
1959 with few

be

more

embarked

on

excess

capacity.

which

industry,

The

today

than 140 million tons of

has
ca-

pacity, and which this year is not
likely to turn out more than 90

capita growth in metal goods consumption in long-run
places marketing at top of suggested list as to what drop
forging should do to keep its place in future growing market.
per

millioii tons, will be building new

capacity before 1965. It means that
we
will be reaching for an 8VZ

_

,

_

ments in

drop forgings shiptons, with the index still

based

1947-49. When measured

are

on

ticular havp hPPn Wnwin* ov*nin
groi
: cjvelv ^ T
vnn
kI

thinT you

POnpprnpH

the

overall

of

gage

the

new economy is the
will start tomorrow.». I

the

me,

that

•

n -v>

J

rt

■

of

nor

•*

v-

i

end..

know

is

that

and

admit

it

/

it

•» v\ re

*»-w ■«

/■! -J

■»

4-1-»

Walter

Campoeii

.

working plants, and, generally,
wuttwiig

expectations to

—

; -

v

.

•

expect

.business io be
was

in

pentagewise,

221

—

million

ht iT7^°ThS -faCe^scarcities of materials

,

US*?**
one

or

expect

families.

dollar

usjng

Then

tors,

x

,

half

to

of

in the crowd,

this
will

year's
be

c'^1

dollar

*

*!

and

We

have

1959

with

to

Rather, the

I ?But

we

can

be

•

this

T^ct

.

|g ®5Q

one

booms

as

.waves of

While
out

of

a

or as

trough
a

the
.

economy,
.

,

.

.

are

.

Money

more money

..

address
annual

a

between

working

—

We

Debentures Due 1978
Due

-

July 1,1978

The

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

two

let

to satisfy those larger*

Progress

—

This

by

Mr. Campbell before
meeting of the members

Springs,

a

all

creation

across our

terrific

of

AMERICAN SECURITIES CORPORATION

BEAR, STEARNS & CO.

COFFIN &, BURR
INCORPORATED

DICK

&,

EQUITABLE SECURITIES CORPORATION

MERLE-SMITH

R. W.

LADENBURG, THALMANN & CO.
L

F. ROTHSCHILD &, CO.

;

SALOMON BROS. & HUTZLER.
WEEDEN

STROUD & COMPANY

PRESSPRICH

& CO.

& CO.

SHIELDS & COMPANY
BACHE

& CO.

INCORPORATED

INCORPORATED

BAXTER &. COMPANY

WILLIAM BLAIR & COMPANY

GREGORY &, SONS

HIRSCH

R. S. DICKSON & COMPANY
INCORPORATED

& CO.

SHEARSON, HAMMILL &, CO.
COURTS &, CO.

H. HENTZ & CO.

NEW YORK HANSEATIC CORPORATION

AUCHINCLOSS, PARKER & REDPATH
McDONNELL &, CO.

THE OHIO COMPANY

obsoles-;

industry builds

WM. E. POLLOCK

replacement demand.
July 11, 1958.

Bigger Markets—All these fac¬
tors add up to

Inc.

Since

become obsolete on the diawing'
board.

us

HALSEY, STUART &. CO.

will 'have:-

loping technological progress has'
been creating obsolescence at a!
terrific rate. In the aircraft in-,
dustry, they say that if a plane
flies, it's already obsolete.
Last
week, I heard a missile expert say
that some of our latest projectiles

new

our way

trough,

Drop
Forging
 Assn., Hot
Va., June 26, 1958.

of

p g

.

In terms of. disposable-.

Technological

cence

*An

'

and

the end of Woild War II, our gal-*

expansion.
we

C

Price 100% and accrued interest

about

out

way

into

......

.

^

one

period between two

the present

fair profit

1

is that

boom. To me, it is both comforting
and sensible to regard the present

.-slump
:

our

and

a

^ ZdTg^o^hat'tlfe

July 1, 1958

vPar

*

represents

of

record, appetite?.

be confident of

recession

XI

offer to sell or a solicitation of an offer, to buy thes* securities.
offering is made only by the Prospectus,.
'
;

43^% Sinking Fund
Dated

was $»5U pe _cap^

More

no

a

consensus

thing: We will work
.of

•

.

...

.sales records will be established.
.

1

capita

personal income, we had $1,173 in
the gradual upturn may continue
1947. Last year, we had $1,779.
through 1959 but that, overall, few By 1965, we will have about $2,300
new
metalworking production or Per capita.

.year.

-

goods.

on per

,

one-third

months.

talked

expects

who

•

$30,000,000

happens m metalwoi king, in
been general,
parallels what happens
fore-,m
wkole economy,

thousand

recent

n-..i

surprise

which has

one

several

over

course, must return
to the ouppuer. 1
<
lUe supplier

should be, similarly
Certainly
there are

person

more

figures

Metalworking

start late this year—a predic-

by

or
.1

economy.

.
1965, we will be spending $1,275.
By 1975, $1,685. While I'm using metalworking figures simply be¬
cause
they are the best figures I
have, they are fairly representa-1
tive of the economy as a whole. -

of respondents is
recession has bottomed

tion which is intended to
one,

,^52?

it"

,

1(M_

th

or
soon
will,
and
that
a
gradual, though modest, recovery

no

buy

J!" 1947'

out,

casters

to

the

are

_

v

consensus

made

.

-

an

The

Bj& Growth Ahead

higher than

Trough Between Two Booms

! will

This announcement is hot

'

&00ds al°ne-

1957's.

the

now

stove,

one

decrease"^! consumption of metalworking

a

and one out of four

that

sales volume

that

people

Appetites—Each

tending

Here

repondents expect a decrease
5.6%. But there are optimists

The

four

help fatten the

Bigger
is

6.4%. For the year, in comparison
with 1957, the picture is similar.

expects

1*.

.

three
stoves,
three
lawn
and three automobiles—

that will

1957. Pereentage-

they expect

,

mowers,

be

than the same period last
Most of them expect that the
coming six months will be below

of

tutw.

and to ^ of b,?en WOrking wUh aluminUm
alloys.
.

^*ie*,r comPCtitors.

lawn mower,

one

refrigerator,

one

better

All

stove,

automobile. But in a few,:
years> that son and daughter will
better.
get married and start their own

.year.

wise,

ii

one

first;half. Per-

second

the last half

M,

horse

tonnage basis. I suspect that
are,

concerned.

erator,

five respondents

one in

the

^1 »1.1.

*■

second-half

x..

i

But only

expects

j.

.

^^!L|\ave

*uecoPi?
will be one jawn mower, and one auto1
y were ,n
mobile, will need three refrigera-

1
x

i!-

last

little

a

to drop. Four

good

as

the

they

u

t

f

be

of five respondents

®x{>ec*f sales
of
five

than it

the

in

S tie first ha«

was

out

one

will

vear

Out

.

secona ndii.

V

i

Dollar sales volume

Only

ji.

^en

-

pretty accurate. Here's what
thev expect for the second half

better than it

i

k;

.

-

jbe

this

a

j,-.-

ings_have not been keeping

we

piciui^ dim, gtneidiiy, we
their

have found

p

*

upsurging population as an i anticipated, and some pretty smart
Possibly
Bu^ to me'
"market" con"
explanations
for
this.
Possi
economic factor has been hashed competitors will be in there fightthere are rational excuses But the ce^
marketing involves much
over
so
often that we'll leave it
ing for the business. - - • • •
record stands Forgings and casi-;more
than merchandising,
It
right there
i
,
.
recoia swnus. roigings ana casa
Weil, that's a general view of
up in
More Famil
Formation5
The the economy I
just happen to have the race. Why?
potential customer wants or needs,
war babies born in the early 1940's in my pocket..
.
,
First - vou have been working '""r—r_
V
will cfnrf
„T^
'
•
Wlli start forming thpip ftwn farn
.Y,irst» you nave .Deen w,or¥ag or should want.
tnen own ram
Where do forgings stand in the with * more
expensive
materials.
Hies in tho "earlv 1960's We ^hould
uu iui5.h6S
m U1C
,
Then
it
follows
to
through
? in tne early i9ous. we sn uia.race?
■
"You.^ have- been working with
t HpciVri and nroduct devrfnot underestimate the effect of m-:
xjow v.fnr^inp*<? hppn
doin^ mnrp allnv <?fppl
Y011 have been
Procluct «esign ana proauct aeveicreaSGd
familv
formations
Mv f'.
How nave forgings Deen doing more alloy steel, you nave Deen opment
Jt jnciudes introducing
? •? - 1fnilly ioimations. My m reiation to the metalworking working with titanium. You have
£
.
f nrofillct, to thp ril<sf

.

11

x.

w

-.

-

■

The

expectations. We questioned
5,000 general managers of metal-

half of

__

Ui»ronooc.

just

ness

,

il_

»

or ca-;0n a
by 1975. That pacity to produce again. The comyou
12
aYinmntlf :InH
rioivifin/l
people make markets is axiomatic.:mg increases in demand iinll be
will
1965,

their semi-annual survey of busi-

!

J 1

the

of

People

editors

"Steel"

completed

i

-I

tion°is base^1Ion"S

ago.

have

,

Se4l*P

six

be

The
of

|

us ex-

months

'

■

,

it

Ncted
would

-

,„fd N®w Co"cepts

us,

that

«

___

One

is deeper than
most of

r\

This is the way the
forging in¬
dustry looks to many people, ineluding some of your customers;
«5

new
% kets of any particular segment of Here"
are"casting" feMpmenfs?^ economy,
good things about the ;
metalworking industry, will ■ foundry
experience
is
roughly ' : • * Nppd New Toncent-i
*
'
ing a magazine editor is that it
expand automatically. It does not comparable to that of
forgings.
v
.gives one an almost unparalleled fmean that the
forging industry'sAnd, finally let's compare the '
"Youil have to embrace a new
opportunity to travel and to talk tonnage will go up 50%. r
■
'
,
index of forging shipments with ™ncept of marketing
Evervmie
to all levels;ofmanagers in nrdhs-.
when the new upswing starts, the index of automobile producJY1
,Cn«S?^i°rK® ! itlwill be accompanied by a great tion, one of your more important
gi eat boom in the >1960 s - to be.
^aj- mpr€ competition than we customers.
he wants
in what mate¬
rial and size, and deliver it to
have ;had ■ in any other postwar
Frankly, I'm a little concerned him when he wants it at a
tion is based on:
price
upswing.
.We are not likely to by the lack of growth in
forgings he is willing to pay The price ©f
More
lean years.

must

we

'

•

fundamental change in attitude.

wdn't

We

with

■

new econare some things the

j

pre-

dieting pre¬
cisely when it
will

%•*

-

in

;01\inX indu.stry will have to do
mY
J. x°r irnPr°ve it#s position,
Jhe first»J ] suspect, involves a

ton-

make sure that we are getting and million to 9 million passenger car nage growth of the
metalworking
keeping prepared for the next up- year as a normal thing. It means market. *
have no intention of talking about swing, - ;; ; '
vYv"T ;
-that most segments of the metalLet's 'look at some of your comour current recession—at
least, at '
That upswing, which should .be working industry will be expand- petitors. Here are
shipments of
1
dF Tv..
4
trv
'*•1V*
"I
Vivi 11
-J
any length
j

one

,

"ut hi§Jly competitive
°*my»

for

metalworking industry, offers

good

a
a

material

raw

hiS

snouicl De

!
the expanding

.,

doing so well.
•
Ifere, in tons, is steel ingot output'. Steel ingot output, being the
important

tnn

'
"'
Quite frankly,

this way, forgings have not been

most

of your competitors in
par-

some

Here

new

programs instead of wor-

rying about
xsteel

;

and

To

will

we

building

.

expanding markets.

L CO., INC.

VAN ALSTYNE, NOEL

&. CO.

The Commercial and Financial Chronicle

16

u ii e

Company of America

Economist for the Prudential Insurance
and

*

.

•

•

■,

projects

*

prosperity by December a $22 billion rise in GNP and
31/2 million «nore jobs. He expects, however, that national
output may rise by only $13 billion, unemployment will decline
6%—about 1 •million persons, and that it will be 1959 before

''r.;-

prosperity and fnll employment return. The economist believes too little attention is being paid to urgent need to bring

•

There

great

exists, it

need

to me, a
into closer

seems

bring

to

contact
the
two
disciplines of
accounting and economics. Econ-

omists, in general, would
benefit from

a

twice

than

much

as

what
is currently happening to output,
-income, and employment, and that
we

economic intelligence.

countants, too,

double

in

the theory and

would
from

output every 28 years,
without allowing for any expan¬
sion in the size of our working

gain
more

a

population.

grounding in

economy

the

nation

So

such
are,

the

as

shall

I

one

discuss,

The

HknnwW

thore is

one

That

cconomv

word

stress

is

or

I

coi^ept - or growth,

about the marvelous record which

has

United-States

enjoyed

this

The

renturv

distinctive

most

feature

income brackets than in
yious period in

our

interesting

any pre-

hist0ry.

article

noint

^Chronicle's"

a

long illness, age 82.

Early in his

Ward became

in 1913
'also

and

a

career

Vice-President of the Bethlehem Steel! Co. t:
a director from 1912 to 1954.
He ;was

director of the

a

Chicago Pneumatic* Tool Co; and a%

member of the American Iron & Steel Institute,
The

Pope conferred

Mr. Ward the Order of the

on

Knights of Malta, which is the oldest order of laymen
and prelates in the Roman Catholic Church.
He was a
member of the Cardinal's Committee of the Laity.
Mr.
also

member

a

"Jimmy" Ward as he was familiarly called by his
friends, including ex-Governor A1 Smith, John J. Raskob
and

great capacity for making
gracious simplicity and
democratic qualities of mind, heart and hand.

Judge Proskauer, had
and

friends

a

for

noted

was

his

The "Financial Chronicle" is
him

friend.

the

where

see

economy

/

"I

v'/ '::

,

today,

has

advanced

pace

which lias been the

envy

much rf the rest of

"he

only 60

United

years

the

has progressed from
p
°my

a

world

farm

ini

;

,

ttTLw

(S4

M(^9

000

($4,000—-$8,000

In

hid

States
econ-

a

v
jf d
/ \
u
to the world's greatest, pro-

grown

++vT

At the

to

the major

News About Banks

developments likely to

point the way to the future.
Since

early 1957,

CONSOLIDATIONS
NEW BRANCHES

economy

our

has stopped growing.

NEW OFFICERS,
REVISED

It is true

that during 1957, the gross national

product,
and

or

the value of all goods
produced, rose by
over 1956, or nearly

The

appointment

of

Edwin Trust Company, made this public

J.

in the following statement:

Murdock and William R. Pauls as

States

United

of

Vice-Presidents

Assistant

Trust

the

Company

Dr. Hauge has been one of Presof ident Eisenhower's principal ad¬

visors

Our true growth, that

inflation.

or

same time, the percentage
of lower income earners declined "

and

services

In

r

agriculture, and only
37% in non-agricultural pursuits.
Last year, less than 10% of our
working force was in agriculture,
and a large proportion of the rein

i.

sharPfi

0£ 5440 billion (annual rate).
Unemployment was 4.5% of the

sum

Pmnnm!p

tfrpwfi,

uQC

ness

somewhat higher than

was

hnrl

nPP1Kinmpfi

Hnr

had.been accustomed to dur-

peri0(js of all-out prosperity
nf

anv

alwavs

even

^be great depression

of

the

1 QlfK

What

were

the

major

factors

IroIstemcdWh'Ch W° h3Ve l5eC°me
^

Within the

lifetiriie,

memory

of

ing'

^

a single
has ex-

and

employment?

i

Once again the economy has
(1) The business, boom! of 1956
panded • at a truly remarkable ground to a halt. We can be fair- owed much
to
the • incredible
rate.
In
1900, when a, 60-hour ly certain that we shall not see a
spendng of American business for
work

mal,!

i

our

week

economy

was

considered

recurrence

nor-

of

the

tastrope of the

The
appointment of William
Lonsdale, Jr. as a Vice-President
;of Manufacturers Trust Company,
New York is announced by Hor¬
ace C.Flanigan, Chairman of the

Board.

T7T

c.,„:

,

New York

was

announced

on

June

14

by Hoyt Ammidon, President.
Mr. Murdock was formerly as¬
sociated with International Busi¬
Machines

Corporation. His
appointment will be effective July

ness

14.

Pauls

in

pany

joined the trust

1933

and

has

served

co-

iv

an economist can

many

things

eCts

pfant

^

•




at

strengthened by

many structural

changes, for example, stock

mar-f

11

Department in
\ \
'
For
the
past five years Mr.
Lonsdale has been assigned to the
Branch Loan Department at the
bank's head office, 44 Wall Street.
.

and

The

as

Manhattan

Chase

A.

and

Kenneth

A.

Soutra

Kropf and Richard H.
named

were

Estate

Moran

Planning Of¬

as supervisor of three
regions in Queens, Brooklyn

bank

Bank,

Personal Trust Officers. Eleanor

Manhattan.

Mr.
the
as

Flanigan, also announced
appointment of John R. Frost
Assistant Vice-President of

an

Manufacturers
Mr. Frost

Trust

Company.

joined Manufacturers

Trust

Company

years

banking operations experi¬

ence

in

1941

with other banks.

after

18

In 1952 he

assigned to the Bank's per¬
department and was ap¬
pointed an Assistant Manager in
1956.
In 1957 Mr.-Frost was ap¬

was

sonnel
and eouipment outlavs

tha£^22%'

-

ciety Of Certified Public Accountants
Woodbridge, Conn^ June is, 1958.

Business

1952.

1956.

•

....

of-Town

department

...

•

sistant Vice-President in the Out-

He will continue his duties in this

^to^^6%'rie
turIrS begL

——

ers Trust Company in 1936, and was
appointed an Assistant Secretary
in 1950. He was appointed an As¬

partment since that time. He was
appointed Assistant Secretary in

Following the White House an¬
currfent prices, amounted to less say without fear of contradiction, ^ose bv more
fdnrW nouncement today of the resigna¬
$100 billion. Today it ex- but of this prediction I feel conof
Dr.
Gabriel
year
In 1957^inereasl tion
Hauge as
ceeds $400 billion.
And during fident. While we have by no means. while continuinoin dollar terms' Special Assistant to the President
these six decades, in which our Hcked the swings of the businessfor Economic Affairs, it was an¬
output has.more than quadrupled, cycle we need not and will. not.
to di^cover excess nounced in New York that Dr.
our
population merely doubled, tolerate a major depression-one caDacitv develoiiing
Hauge will join the Manufacturers
As a result we have
today more as deep and prolonged as the pain^
~
* Trust
Company, New York as
ful plunge of the 1930s.- Since that
°,le reason for the piling up of Chairman, of the Finance Commit¬
An
address
by Dr. Freund before
time our e c o n o m v hac Kpon excess capacity was that ,duringtee."
'
'
Annual Meeting of ;the Connecticut SoIT"®
u n ° m ^
nas ,DeeU the eourse of the'Dast twd vearf
than

-

Mr. Lonsdale joined Manufactur¬

the Real Estate and Mortgage Dr

ficers.

1930s~ro ITe

not

total output of goods and
services-, measured in terms of
our

He has also served

States" delegate to
international - economic

conferences in recent years.

Rossitter

j

Ad¬

-

»e?ely stopped grow- ^^1"^ for tte pause to
economic growth, and more re¬
pointment of Charles M. Frey,
such as the recession of "1948- cently, for the down turn in in¬ Eugene J. Galbraith, Walter S.
come

an

United

several

New York, has announced the ap¬

?canomy

as

1953 to July
became Special

he

nomic Affairs.

Mr.

Drocleded at
cedmg monthsSaee Wd hlvl had neriodf of the ec°"°my dari"g the third
Pevere eco„omic decline slch Is *3?* °f 1957 was stiU doing
well.
not

served

-Assistant to the President for Eco¬

'as- a

pre-

nf

during the preBut ln general,

when

1956,

rPnl

during the

th#*

ecbnomicgr^th
economic giowtn

has

ident from January

,

Producmg a WPP* of Soods and
eervlces valued at the astounding

and

ministrative Assistant to the Pres¬

$4 billion.
; i
Toward the end of 1957, the-'

ing

Bankers

and

ETC.

CAPITALIZATIONS

services

billion

S oVthe totaf lahor force. This rate of jobless-

to 4.5 A ot the total.

t-drnexs aecnnea.
a no services. 1 u We have enjoyed economic growth
„our abor ^rce was and its benefits haye beeri widely

ducer of goods
limn co of
4
ol

engaged

bracket

die income

of

•V

the

1957. .We were then

the United States
economically at a

V

.v-

is

first logical
step is to assess our present posi¬
tion. In this way we can appraise
heading

denying that in the

no

proud to have numbered

of its most faithful staff workers and devoted

one

as

I Position
To

_

Century,

His¬

Society and the Friendly Sons of St. Patrick.

recession deepened.
The first;
phase, the. leveling out in the real
production of goods and services,
gave way to the second phase,
heights of business activity is not ®nd ?£ tbe scaie—and a .striking the actual decline in business acenough. As never before in the
S1® middle.
This tivity.
.
i ;
postwar period, our prosperity de- smii
tne article goes on to say,
jn dollar terms, our economy
pends upon economic expansion.
has been termed one or the most reached a peak during the third
There is

American-Irish

was

torical

.

20th

the

of

Ward

the output of goods and services dur-

I

-

;

was

•June issne of "Business in Brief," ing 1957 amounted to a mere 1%,

upon you

:

Mr. Ward was an office boy for
Andrew Carnegie and later personal secretary to Charles
M; Schwab, a founder of the United States Steel Corporation,: and afterwards he followed Mr. Schwab to; the
Bethlehem Steel Corporation at its founding in 1903; ;Mr.
/

In a is the real advaiice 111 our physical

in

most

Present

5%. But this growth was almost
entirely illusory. Out of the 5%

is that
too little attention is being given
impress

A Diagnosis of Our

$20

ver^

Avenue home after

our

the chase Manhattan Bank dis?usses this f°wtbL°f tbe fiddle
income market. The broad pictoday t o 4he vi r gent meed to stimuxt saJsv shows continuing
late growth.
In the present re- long-term declines in the shares
cession, mere recovery to former
groups at the top and bottom
during

want to

are

larger Proportion of our popula- increase in gross national product,
tion now belongs to the middle more than 4% was the result of

growth

word

should sav^this concent of growth
say'this

the

we

has becn the extraordinary sharillg" of our growing prosperity. A

our

word I want

this

in -sfro^sin^

of

cfflfp

fhp

not likely to
suffer a repetition; of the 1930s,
anyone observing business conditions today knows that we have
not learned to lick the moderate
downturns in business activity.
Although

about America's economic growth

of Growth

Record

A

AnH

2%. At this rate, we
output every 18 years,
*}{■?»
apart from any increase in tn9
number of persons employed.

double

professions.

Tn

greater pace.

even

frequently and in enough
allow a fairly prompt *
of the health of the

economy,

not

year,

after all, of direct concern to

both

to

William C. Freund

any o f
problems,

m

our

an

Since 1947, the productivity incre¬
ment has
been
close
to
4%
a

firm.

the

and

In recent years, our
has been increasing its

efficiency at

economics
the

of

Today, we are fortunate in having
large battery of statistical series,

our

thorough

Another member of the

alumni, James H. Ward, died last Saturday at his Fifth

a

available

at

1876-1958

During the

ing in darkness to find statistics
which would pinpoint the extent
and the reasons for the depression.

practice of ac¬
counting. Ac¬

foundation

re¬

most astute economists were grop¬

detail, to
diagnosis

did

take

to

depression of the 1930s, even the

production

we

able

better

are

medial action on the basis of this

the

than

person

'

Remember too that we now have
sensitive measures to gauge

turn of the century when our
labor force worked half again as
many
hours as most of us are
11
~~
* "
accustomed to doing today. This
startling growth in output reflects

per

of employment. ^

high level
-

.

.

—

America's penchant for increasing
productivity. During the present
century, our productivity—or output per man-hour—has increased
by 2Vz% a year. At this rate, we

solid

more

depressions.

,

b

ahont—beyond mere recovery—economic growth and asserts
«our prosperity depends upon it.
Reviews past economic growth
"extraordinary sharing of our growing prosperity"; in diagnos¬
ing our present position, particularly blames inventory factor
for being responsible for two-thirds of present drop in output;
and depicts as long-run problem the overcoming of infla¬
tionary biases built into our economy and as short-run prob¬
lem combatting of recession and restoration of economic growth
i

JAMES H. WARD

ac¬

In 1946, a bipar¬
tisan measure was passed by Con¬
gress and signed by the President
—the Employment Act of. 1946—
which gave formal recognition to
the responsibility of the Federal
Government ftfor ; maintaining
a
bat

prerequesttes for fall employment and

as

affecting business

forces

tivity and that, as a result, we as a
nation have not only a new ability
but also a new willingness to com¬

-

Adj. Associate Professor of Finance, Graduate School of
Business Administration, New York* University

Dr. Freund

the

fit Mvmanmti

deal about

have learned a great

we

FREUND*

Thursday. July 17, 1956

1 o y ir> e n t y c o m pensation,

nip

price supports, bank deposit insur¬
ance, and a host of countercyclical
fiscal and monetary policies.
I think also that since the 1930s

And Economic Growth
By DR. WILLIAM C.

:■

.

regulations,-1

securities

and

ket

The Outlook for Business

.4 •;>

.

.

(212)

course.oi. tne pasr iwOj years,
Continued

on

page

33

■

the

handled

throughout

C.

Flanigan,

Board

of

Chairman

Manufacturers

the

the

bank's

New

business

England

States.
The

.

Horace
of

pointed an Assistant Treasurer
and assigned to the domestic de¬
partment.
Since
then
he
has

Buono

appointments of Vincent C
and, Robert A. Byrne as
Continued

on

page

32

Volume

188

Number 57C0

.

.

.

The Commercial and Financial Chronicle

(213)

models which, this
year,
will be somewhat earlier than

17

new

THE MARKET... AND YOU

has been the

Mideast developments
the

international

hard

times

in

oils

this

Still increasing, but at a slower
rate, common trust funds are
reported to have risen from 243 in 1956 to 277 in 1957. Cleve¬
land Trust points out total assets
have reached almost $2

big
companies to raise prices

to offset the automatic
wage

Summed

gave
some

continues,

market increase that went into effect
has
done on July 1 was, among other

it

as

billion with

the

up,

week's

stocks comprising
nearly

common

61% of last year's

new money

throughout the deluge of bad things, indication that they
"The number of common trust
overly pressed in their funds," states the July "Business
sporadic rior stability at a time when profit showing. If profits were Bulletin" of the Cleveland Trust
and the affected issues were the odds
should be all against in serious
jeopardy a price in¬ Company, "has increased rapidly
able to show
rallying tenden¬ it. Trading was orderly and crease would be almost man¬ in the last 10 years. These funds
are
operated by banks and trust
cies at times after the initial
only on a couple of busy open¬ datory.';.;:":"'. -'v'-;
./-.iv.
companies as trustees. Their pur¬
shock of the Iraq revolt.
7
ings was there a late tape and
pose
is
to
combine
stock

markets

sure

*

;

but

the

*

*

;;Vvi

Helping the oils with large
interests in the
fact that

business news, to show
supe¬ aren't

pres¬

area

was

the

the

even

Iraq revolt
apparently failed to disrupt

operations

of

the

oil

com¬

half—though

went into bonds.

preferred stocks, 10.%%; and other
investments plus cash, about 2%.

somewhat

was

Rapidly

In Past Decade

extreme reluctance of the

steel

:

Common Trust Funds Increased

in the

post¬
period up to here. The

war

By WALLACE STREETE

case

"M

a r

k

e

t

value
of
holdings
$1,966-million at the

amounted to
end of
974

1957,

as compared;

million

chases

a

with $1,-

earlier.

year

during

1957

totaled

Pur¬

$448

relatively million at
cost, while proceeds
Depressed Items
then only briefly.
small trust accounts into one
pool, from sales and
redemptions were
so as to obtain broader
diversifi¬
In the domestic
$342 million. Of the net amount
oils, Texas cation of
Good Values in the Rails
investments. A few were
of new money invested last
Gulf
Producing which has started before World War II, but
year,
it is
estimated
\ : Far from being troubled by been a bit
that
61%
was
clipped by the pro¬ the big development came after
placed in bonds, 12% in preferred
the slow, summer
reports, in¬ duction limits in Texas was 1946. At the end of that year
stocks, 24% in common stocks, and
vestors
apparently were look¬ both a depressed item as well there were 39 such funds.' Five 3% in real estate loans. "
years later, in 1951, the number
ing forward to the post-Labor as one with
"In size of
high statistical had grown to 119. By the close of
assets, the funds vary
Day pickup which, among value. A rather
all the way from less than
$1 mil¬
sharp drop in 1956 it had reached 243. The year
other things, promises relief
1957 brought a further rise to 277 lion to more than $50 million. At
profits is anticipated for this
or near the close of
for rails
(managed by 214 banks and trust
1957, about
generally and for year because of production re¬
67%
of the total number were
companies) with assets of almost
those in particular that have
strictions but, as one source
in the range of $1 million to
$2 billion at market value.
$25
been able to resist the reces¬
million."
-

panies in that country. Then,
too, the unopposed move of
U,

S.

Marines

into

Lebanon

failed to set off any
ate reaction

immedi¬
by the anti-Amer¬

ican elements.
if

*

#

sion

put it,

even

better than

some

of

Meanwhile, as in the Suez the top corporate giants.
crisis, the domestic companies Southern Pacific, for instance,
were heartened
by prospects reported earnings of $6.01 in
tof using their production to 1956, $6.02 in 1957 and pro¬
fill any voids that
might de- jections points to around $6
velop from Mideast disrup¬ this year which isn't the clas¬
tions and some were down- sic example of the effect of
right sensational, notably any recession. And its yield is
Richfield which went in for around 6Vis/c.

reserves

of 37 barrels

of crude oil and

150,000 cubic

-

'

■

j;

*

multi-point gains and plunged
new
high territory

.

❖

*

Nor is Southern Pacific the

Iwell into

sole

example of good stability
Western roads. They
International Business Ma¬ have had, in part, to pay a
chines in the high-priced sec¬ penalty marketwise for the
tion, which depends largely big clamor raised over pas¬
on
foreign trade, was even senger "losses," freight rate
harder hit than the interna¬ increases and legislative help
for all time.

t'f

if.

#

the

in

that has been most strident in

tional oils and put two

eightpoint losses back to back be¬ the
fore it found some support.
The
one

harder hit oil item

was

without direct investment

in

Iraq—Gulf Oil. This item,
like IBM, was sliced for two
rather

large losses in

before

it, too, hit at least

a

row
a

temporary plateau.
Market's Restrained Reaction
As

previous war scares
gone, market wise, the
performance of the list this
time
was
remarkably re¬
strained, the accent being on
some spotty improvements in
the business picture and welldepressed items, such as the
have

rails,

which

ignore

most

commotion.
came

at

a

were

able

to

of the Mideast
The

new

unrest

time when the list

case

of the Eastern roads.
if

A

*

if

convincing illustra¬
tion of the ability of some of
the rails to keep in comfort¬
able shape is the dividend
coverage. Kansas City South¬
ern, for instance, will show an
earnings decline of some $2 a
share from the 1956 profit to
the one anticipated this year
but
expectations are that
earnings will still cover twice
over the $4 dividend rate and
its 6% return. Great Northern
which shows a yield of better
than
its
or

more

8% is expected to cover

$3 dividend with
so

per

Southern

where

share

Pacific

the

1958

dollar

a

to
is

spare.
a

results

of natural gas for each
share of stock is an intrinsic
value

are

that

ably with
panies.

the

larger

com¬

depressed

.'f

if

if

Some of the business

news

a

bit

Electric




-

an¬

all

the

Board's

It shows that at

end

of

1957,

Form Childs Sees. Corp.

funds

banks and trust

panies under

the

trust

common

CHICAGO, 111.
with offices at

Regu¬
or

141

West Jackson

Boulevard. Officers

near

stocks

common

Childs Securi¬

—

ties Corporation has been formed

com¬

are

F. Newell

Childs, President; Donald E.
.

Barnes

and

Elwood

D.

Boynton,

machinery section holdings, at market value, of all Vice-Presidents; and Marion
which slipped from a peak of funds combined. Bonds (includ¬
Ruddy, Secretary and. Treasurer.
nearly $44 last year to well ing notes and certificates) amount¬ All are officers of C. F. Childs and
below $30 lately. At a time ed to almost 40% of the total; Company.
when operating efficiency and
ability to cut costs to discount
the recession are being eyec
This is not
offering of these shares for sale,
offer to buy, or
solicitation of an offer to buy,
any of such shares. The offering is made
only by the prospectus.
carefully, B1 a w-K n o x ha!
done
welL without
getting
an

must

attention.

or an

or

more

a

For the firs*

quarter sales

declined 18%,
than $8 million, buf

980,000 Shares

the company was able to hole
a modest $442,-

Pacific

net income to

000 trim. The steel

industry is
the principal customer of
Blaw-Knox and the sales drop

Lighting Corporation
Common Stock
(Without Par Value)

represents their retrenchment
the way for a

but also paves

Price $47.25 per share

rapid rebound when their ac¬
tivities pick up. In any event
the company is expected to
net around $3.50 for the year,

Copies of the prospectus may be obtained from any of the several under■writers only in stales in which such underwriters are
qualified to act as

which not

only compares fa¬
vorably with last year's $3.99
which included

a

51-cent

dividend
offers
turn

a

requirement which
better than 4% re¬

apart from the 4 and 5 %

stock payments

added to the

cash in the last two years.

The

various

in

items

dealers in securities and in which the
prospectus may

Blyth & Co., Inc.

w

Dean Witter k Co.

>

Goldman, Sachs & Co.

Harriman Ripley & Co.
Lehman Brothers

Smith, Barney & Co.

Operations currently are in Moreover, its range was a
modest five or six points in
something of a summer* lull
but the companies have the preceding three years. It
shown a superior ability to has yet to approach the peak
hold up profits to comfortable is set in 1954 of $40 when the
market was lower
levels at low operating rates general
than it has ever l?een since
that once were thought
to
mean
automatic red ink re¬ despite the October and Feb¬
ports. Then, too, a sharp up¬ ruary selloffs. »t.

[The

.k

*

tf

"

♦

time

do

not

coincide

with

Kidder, Peabody & Co.

Merrill Lynch, Pierce, FenneT & Smith

Stone & Webster Securities Corporation
Schwabacher & Co.

-

Walston & Co., Inc.

White.Weld & Co.

William R. Staats & Co.

A. C. Allyn and Company

Bateman, Eichler & Co.

Incorporated

A. G. Becker & Co.

Crowell, Weedon & Co.

Incorj>orated

First California Company

Davis, Skaggs & Co.

Ilallgarten & Co.
\

Incorporated

Hill Richards & Co.

Hornblower & Weeks

Lester, Ryons & Co.
F. S.

Moseley & Co.

Paine, Webber, Jackson k Curtis

Weeden & Co.

J. A. IIogle k Co.
Mason Brothers

Spencer Trask k Co.

Wilson, Johnson k Higgins

Incorporated

Wulff, Hansen k Co.

Quincy Cass Associates

Dempsey-Tegeler 4 Co.

Evans MacCormack & Co.

Maxfield H. Friedman

McAndrew & Co.

Morgan & Co.

Incorporated

r.

)

.

.

.

...

Stone & Yoengberg
.

/.

Harbison & Henderson

Skearson, HammDl k Co.

•

Stewart, Eubanks, Meyerson k Co.
>■.

Laurence M. Marks k Co.

Bingham, Walter & Hurry, Inc.

Stern, Frank, Meyer & Fox

Baker, Weeks & Co.

July 16, 1958:

Company

Lawson, Levy, Williams k Stern

Revel Miller & Co.

Kerr & Bell

Brush, Slocumb & Co. Inc.

E. F. Hutton &

Bache & Co.

Fay

Reynolds & Co., Inc.

Wagenseller & Durst, Inc.

Francis I. duPont & Co.

Hooker &

Langley k Co.

Mitchum, Jones & Templeton

American Securities Corporation

Sutro & Co.

Elworthy&Co.

Hemphill, Noyes & Co.
W. C.

Irving Lundborg & Co.

Shuman, Agnew & Co.

views

expressed in this
necessarily at any
those of the
"Chronicle " 'They are presented
as those of the author
only.]-■*" "
article

Corporation

Glore, Forgan & Co.

Incorporated

Lazard Fr&res & Co.

J. Barth & Co.

the

The First Boston

Eastman Dillon, Union Securities & Co.

food section have been

•

legally be distributed.

non¬

recurring credit. But also well
covers
the
$1.20 indicated

Interest in the Steels

heartening, General
showing a slight im¬
provement in earnings for the
second quarter over the drab
first quarter, the Federal Reserve
reporting industrial
production continuing to im¬ surge in their production is
prove for the second month,; generally
anticipated when
new car inventories dropping the auto makers start to build
sharply, and so on.- •,
> up» their inventories
of the
was

third

item is Blaw-Knox in the in¬ comprised nearly half of the total

taking
their turns in the limelight,
Steels continued, even latest being Best Foods, but
the apparent laggard in this
any extension of the break¬ through the latest uncertain¬
through by the industrials. ties, to show investor interest section is United Biscuit
Rails, however, were back in when there wasn't definite which has held in an eightnew
high ground shortly pressure on the entire list. point range all this year.
after.

tutional
covers

lation F.
a

its

type of insti¬
investment.
The report

dustrial

requirement.

had

just succeeded in posting
new 1958
peaks and did serve
to blunt, at least temporarily,

published

nual survey of this

favor¬ operated
by

compares

Also considered

case

expected to be double the
dividend

feet

"The Federal Reserve Board has

recently

-

'

'

Henry F. Swift & Co.

The Commercial and Financial Chronicle

18

.

.

Thursday, July 17, 1958

.

(214)

Thoughts

Some Second

British

on

to

unpopular,

Eng.

When

—

the

inflationary

the

immediate re¬

action
rise

was

in

a

equi¬

ties, a weak¬
ening of ster1 i n g,
and
wid espread

of

the

Govern¬

popularity continue, it 5.12%.

early general election,

ing abandoned

presumably in

the

resistance to

Until quite recently

his policy was

inflation.

to defer the dissolution of
ment until the latest

fore very long,

influence

the

tainties

Wall

of

Street

clouds

and

in

uncer¬

inter¬

the

on

be

to

prove

political

all, the considered opin¬
public has become much

Above

ion of the

favorable

more

Govern¬

the

to

in sterling
of

a

and

was

its

holding
few weeks later
barely

stock at the rate

ground, but a
public opinion surveys

indicated

principal

be

each $100

debentures,

of

amount

of

point of view the
trend of wages and of prices is

Henry Mentor Assoc.

a

Conservative

moderate

ma¬

be

has

expansion
credit

in

Apart

Miller

Association,
that banking

to

ranged to dispose of his interest

ciates,

the

economy

business recession in stride

a

"No

business

two

cycles

pointed

he

alike,"

"The

out.

some

more

from

emanate

corrections

circumstances
less different from what
of

combinations
or

have taken place before. Yet
today there seems to be universal
agreement that this, the deepest
general recession since the 1930's,
embraces
noneof the fears of

may

liquidation

credit

drastic

that

deflation

monetary

other'hand,

by
rate,
instalment selling,

on

stagnant

the

output

employment.

in

effects

the form

of

and

their

firrii

would

and

accom¬

panied the earlier depressions or
recessions. To put it another way,
our
banking
system
today
is

higher un¬
psychological
discouraging.

Jacob M. Alkow,

formerly Vice-

President, has been elected Presi¬
dent of the

firm, and the seats on

the New York Stock Exchange and
American

Stock

merly held
been

Exchange

for¬

by Mr. Montor

have

to. him.

transferred

Seymour Fishman, of the firm's

office, has

Chicago

elected

been

Vice-President and Secretary.
L.

Norbert

Balti¬

GrunwakU of

elected
VicePresident, and George Colan has
been
named
Vice-President
in
has

more,

been

'

Charge of research..

;

s

;

the ability to

be made at

ing

prices ranging from 104% % in the
first year to par in 1977; provided,
however,

that

the

debentures * may

sinking

fund
retired

be

not

interest

an

51/8%

cost

of

less

Sinking

year.

per

of

and

military

aircraft,

spare

is

for sound
helpful answer

necessary

"It is

a

fo "the" alarmists wlio

than

fund

redemptions will be made at par.
Since its inception the company
engaged primarily in the
design, development, manufacture
mercial

adjust, while retain--

solid base of confidence and-

courage,

has been

and. sale

a

progress.

prior to Aug. 1, 1963 from or in
anticipation of moneys borrowed

related

products arid

formance

com-

pessimistic
In my

the business news.

side of

in-

have the

clination to look at the

Should the Government win the

general election, it would be in a
position to take unpopular meas:-.1955.

by

syndicate

Halsey, Stuart' & Co.

opinion, there has been too much
pessimism bandied about by ir¬ tures, due July 1, 1978, at 100%
responsible elements. One can de¬ and accrued interest The gfdUfp
tect
symptons
of
the kind of won award of the debentures at
thinking that "led to the false no- competitive sale July 10 on a bid
tion before World War II that the of 99.2099%.
...
r
■
__

„

economy

'stagnant' or 'ma-r
Net proceeds fbom the financing
seeking to make will be added to the company's

was

Some

ture.'

are

able for the construction progfatti.
The estimated cost of all facilities

offered for

four-engine jet trans¬
The first order for
was

headed

Inc., on July 11 offered an issue
of
$30,000,000 Southern Natural
Gas Co. 4)2% sinking fund deben¬

general funds and will be avail-

port aircraft.
this aircraft

Debentures;

underwriting

the per-

sale to the commercial airlines of
a

An

incidental

of services incidental thereto.

the world

Move Amound

Gas 41/2%

parts and

m

services

of

In 1955 the company

Would Give Five Years' Period to

,

Offers Southern Natural

debentures may

ance

of elections.

programs.

material

measures

come

in the firm it hag beem announced.
'
v
-

are

characteristics of some booms and

tional redemption of the sinking

fund

Bank

investment

from

of these

halted

been

high

squeeze,

restrictions
cuts

the

On

votes.

resistance to wage demands

Montor; t President and
Henry : Montor Asso-

oL

founder
P.

Lee

con¬

political hay—and I do not mean
that in the partisan sense—out of
a recession which naturally shouldthereto. Commencing in ,1945 the have been
hearten
Government
expected to follow insupporters.
Public Welcomes Change in
The more the trade unions will company has also been engaged fiationary .developments
and a
Conservative's Policy
in research and development work
capitai
expansion
boom. , They
press
their
unwarranted
infla¬
in the military missile field, and,
The explanation of this change
areue that a modest decline m the
tionary wage demands the morfe
more
rerentlv
more
lies in the relief felt about the
recently, in thn brndi rtinn ?rgu,e Gf mostmoaesi aeciine m ine
in tne pioauction ievej H131 a
general business munpopular the Labor Party would
of missiles, spare parts and rerelaxation of disinflationary meas¬ become
dexes and a more serious decline
among
the
"floating
ures.
Ever since the end of 1955
voters'' who determine the out¬ lated products and the perform¬ in certain industries constitute a
in

.

Halsey, Stuart Group ;

at

of considerable im¬
a distinct increase in the Govern¬
portance. Should there be another
ment's popularity in the country. round of wage increases betweeh
Today political prophets believe, now ana the general election it
for
the
first
time
for
three would greatly discourage the longyears, that a general election in suffering middle classes, and the
the immediate future might result Government
would
lose
many
jority.

„

.

They may be redeemed at the opIt is contemplated that the narrie
tion of the company at r prices geared to handle the changes in
of the firm will be changed in the
ranging from 105 V2% in the first supply and demand relationships
year to par in 1979. Sinking fund that market forces introduce in near future,
r
redemptions will be made at par. the credit structure." r
A sinking fund, commencing in
Too Much Pessimism r
1964, is calculated to retire at
least 94% of the sinking fund deThis is a healthy circumstance,
bentures prior to maturity. „ Op- according to Mr. Miller, because"

this

likely to

capital

two shares of stock for

Labor victory

From

convertible

will

new

Government

subordinated

convertible

into

S6
policy.
This
last produce the opposite effect.
aspect of the secondary reactions during the next few months we
likely to witness irregular
to the change is of particular im~ are
porlance. Quite suddenly during fluctuations 011 the Stock Exchange
the early days of July the Gallup and in the foreign exchange mar¬
Poll
and
other
public
opinion ket, according to whether the
chances of a Government victory
.surveys indicated a distinct swing
of public opinion in favor of the are assessed high or low. And the
Government. In June it appeared assessments of prospects are liable
from
election
results
that
the to change from time to time.
ment's

with
in-

.

Bankers

take

receivables.

and

debentures

the Stock Ex*

on

together

available,

The

On the other' hand, fearfc
would tend to

change.

be

ventories

'

Miller declared

Mr.

Any balance of the proceeds

^i mflation.'V

Henry

vention of the

$115,-

and,

them through the insidious

Official Changes in

in

Wisconsin

•

incentives

our

Inc., 40 Exchange Plac6,
New York City; members of the
New York Stock; Exchange, has
resigned as President and has ar-

annual

retained earnings, for process

became

Exchange

of

will

likely to miss the opportunity
for renewing the mandate of the
electorate for another period of
not

"routje

i 1 w a ukee,'r.
Wis.,'on June,
25; before the J

000,000 outstanding as of June 16,
1958.

Hotel,

nourish

must

not sap

at the Shroed€r

We must keep our
and resourceful.

strong

for growth and development,

In an address-

?

reduce

to

We

f

nofinrfQl
national suicide
the forces of

battle agains

^communism.

and
o

rtAi

bordering no
our

-economy

stfength t helps

possible mo¬
the rise in

horizon,
the
unde¬ five years.
An
autumn
general
election
cided, even though the undertone
femained fairly steady.
Sterling would introduce a new element
became
distinctly firmer, even of uncertainty in the situation.
though it continued its ups and The prospects of a Conservative
downs.
victory would cause a sharp ris&

national
Stock

used
loans

'Ka
be

tin

Fidelity Bank
and Trust Co.,
Louisville, Ky.

.

popularity
lasting he is

Government's

should

be

bank

short-term

if

But

1960.

ment

c.iu/ig

Under the

prevail.

to

come

fa'ui

Dr.

however, sec¬
ond thoughts

will

bentures

Parlia¬

V"

v

Citizens

the

subordinated": de-

convertible

the

banking-have made only slow progress in
of real correcting the distortions that the

American

President

sale of the senior debentures and

late autumn.

Be¬

>

It is expected that a substantial
impossible that
would decide in portion of the proceeds from the

.

the

.of

ciationy

est, which is an offering; yield'of

means

no

Macmillan

of

element

an

Bankers Asso-

July

due

)

favor of an

ment for hav¬

had

the

convertible sub-

debentures*

1, 1980, in the ratio of $100 princi¬
pal amount of debentures for each
23 shares of capital stock
held,

mone¬

is

by

is

President

$30,597,000 principal

amount of 4y2%
oridinated

1958 rights to

15,

July

record

subscribe for

Should the increase in the Gov-

Mr.

pro¬

strength in the current business last inflationary surge produced,
to Lee ; P. and to give them new life would

#

ernment's

of

criticism

banking structure's soundness

warns

Boeing Airplane Co. is offering recession,, according
holders of its capital stock Miller, VifG- "
Vice-

disinflationary fpolicy Harriman Ripley & C6. Tnc.^ and
would be continued even at the Blyth & Co. Inc. will C purchase
risk of a slump. Hence the favor¬ any unsubscribed debentures.
Simultaneously, the company
able reaction, expressed in public
opinion surveys, to the abandon¬ offered to the public, through unment of disinflation.
derwriters, $40,000,000 of 5% sinking fund debentures, due Aug. 1,
May Lead to Autumn Election
1978 at 98.50% and accrued interthe

soundness

structure

therefore, greatly relieved by the The subscription offer will expire
Government's change of policy, at 3:30 p.m. (EDT) oh July 29.
Until recently it was widely feared An underwriting group headed by

Mr.
Amory, announced the Governttient's decision to reverse its *dis- that
policy,

The

and

to the

day changing prospects for Government victory. Election suc¬
cess, it is pointed out, would give the Conservatives five years'
period to pursue (and live down) sound, but
tary and tax policies.

our

strength in the current recession; finds

pessimism bandied about by irresponsible
we must protect ourselves against re¬
sumption of dominant inflationary pressures.

elements;

Airplane Debentures

irregular fluctuations on the Stock Exchange and
foreign exchange markets in accordance with day by

LONDON,

vides element of real

halt.

a

Ripley Group
Underwrites Boeing

until then,

Chancellor of the Exchequer,

Banking Termed Recession's Bulwark
Lee P. Miller declares

brought

been

there is too much

Einzig writes, may lead to an early general election—perhaps
this late autumn. He anticipates in the intervening months,
in the

has

Harriman

EINZIG

British public opinion's approval of
reversed disinflationary program, Dr.

Government's

inflation

once

Continuation of recent
their

The

taxation.

tribute towards a business revival

Abandonment oi Disinflation
By PAUL

in

reduction

due

prospects of it would greatly con¬

obtained in Oct.
-

The company has now re¬

in

construction. program,

the

is

approximately $105,000,000..
The debentures will be redeem-

deD®ntul*es

Wi

abje at optional redemption prices
ran«;n2 fr0m 104^%

to

Mils

nar

8 2 from lU4_2 ,o to par, plus
However, no de¬

accrued interests

bentures may be redeemed at

the

national calamity that only vigor¬

option of the company prior to
July 1, 1963 as a part of a refund¬
ing or an anticipated refunding
How wrong they are! Their clam¬
operation involving the.-incurring
or, serves
no
useful purpose be¬ of indebedness having an interest
cause
it
tends to
injure public cost to - the company less than
confidence—the catalyst of stab4.57%.

sustained action by all-pow¬
erful
government
can
correct.
ous,

ceived orders from United States lity and progress.
A
sinking
fund commencing
foreign commercial airlines
Accumulated,
inventories
are
July 1, 1960 wilL retire: on or beIt was widely felt that, while the term, it would be able to tivfe for a total of 184 of five versions
being chewed up, incomes are fore maturity all of the debentures
Socialist Government had' been down
any unpoularity that would of . this aircraft knowtt as Models
to tod-!Sr
matf"y'a11 of the debentur
able to proceed with expansion, be caused
by disinflationary meas- 707 and 720. In addition the ,Com-:
are
biild:

effect had been very

have

would

inflation.

check

to

tires

another

it

Since

five

vears'

.

and

fllt

♦

+

,,

*

«.*.

^

^

«.

,

the Conservative Government had

ures.

created

the

a

chronic

condition

in

which the brake had to be applied
almost continuously.
,

The

removal

brakes

has

comed

with

of

relief.

of

most

therefore

the

been
It

thinking people realize

is

wel¬

true,

that

this

will
almost
inevitably mean a
resumption of inflation. But Brit¬
ish public opinion has come grad¬
ually under the influence of fears
of
a
depression.
Even
though
most economists still feel that in¬

flation is the
.,.

.

greater danger, the
-

...

-

After

the

Government

victory
made

mistake of pursuing
ary

policy.

too

much tc

an

1955
great
inflation¬
of

the

Quite obviously it

was

within

election.

months

Now if the

after

1

P® P




three

by

would
over

be

to

for the

new

in

Government

a

early
term of office, it

letter

jfc4

con-

in good time
following general election.
five

years

in

—

office

in£?

more

Model

707

aircraft

for

use

government executives.

Thomas

J.

Martin,

associated

with Bache & Co., passed
July 13 at the
a

age

, away
of 54 following

long illness.

Michael A. Cappa
Michael

A.

Cappa, associated
with A. G. Becker & Co. Incor-

f, porated, New York City, passed^•

are, chahce to carry out a Pong over- away July 2.

which

upon

position to switch

expansion

Another

a

Thomas J. Martin

the

will adopt disinflation at an

stage of its

received

expect to be able to

few

a

has

tract from the U. S. Air Force for

continue that policy for five years.
In
fact, ir had to
be
reversed

S^n7&ve3 Conso-vatives
:

pany

to

a

stronger

resume

base

our

na-

iSl'fcTci-'U
Uo.IS

&out^ern. natural. Cxas

engaged principally in the inter-s^ate

transmission

and

,

sale-1 of

by
eliminating
growth
many
of the
distortions which
were so much a part of the infla¬

companies and municipalities and

tionary boom."

tain

tional

The
told

Wisconsin

that

it

is

bankers

important,

months, that we guard
vigorously against the resumption
of
dominant
inflationary
pressures

are

lurking in the background, ready
to spring forth, should unwise fis-

calTnd moneta^'poHcrra
the spark.

wholesale to other

districts, and directly to cer¬
industrial

users.

f

The

com¬

pany's pipeline system extends to
"as the markets in Louisiana,Mississippi,

coming

These

gas

gas. at

were

forces of recovery proceed in the

pressures.

natural

pmlde

Even in recession,

we

Alabama,
Georgia
and
South
Carolina. The company is also engaged in exploration for and development and production of gas
.

and

oil, and it also sells gas not
connected to its system, as well as
oil and distillate.

For the year, ended Dec. 31.

1957, the company and its subsid-

Volume

188

Number 5760

.

.

The Commercial and Financial Chronicle*

.

iaries,-had consolidated operating
of

revenues

solidated
ooo.

$101,151,000 and
income

net

of

•

Lehman

Group to Sell

Panama's Finance

Eleta,

President
and

Minister, Fer¬

approval
of
de la Guardia

Cabinet,

has

Lehman

Brothers

to

head

underwriting

an

appointed
form

and

for

group

public offering of approximate¬
ly $26,000,000 Republic of Panama
a

external bonds.

'

Security for the bond issue will
be based on the treaty of 1903 be¬
tween the United States of Amer¬

ica and Panama for the construetion of the Panama Canal. Under

treaty,

amended,

as

States

the: United
4d^ pay*»Panama in

agrees

perpetuity $1,930,000 annually as
compensation for the rights grant¬
ed

the

to

United

Canal Zone.

States

in

the

$1,500,000 of the

an¬

nual

treaty payment is to be ir¬
revocably assigned for 30 years
The

to

First

of New
bond

National

City Bank

York, fiscal agent for the

issue,

receive

that the bank will

so

the

annual

payment di¬
United
States

rectly from
the
Treasury and apply it to the full
payment of principal and interest
when due.

"Proceeds of the bonds

to be

are

Over the years we all meet
people we admire, and sometimes
they are an inspiration to us as well as to others. Their lives are
examples of courage and kindliness, and many of these people
have triumphed over difficulties that would have been too
much
for

others to

American

-

Highway

City and Colon has
previously financed and a

been

large

part

structed.

of

The

constructed

the

has

it

feeder

will

been

con-7

roads

afford

to

be

to

access

Highway from many areas of
nation, thereby greatly im¬

the

proving the economy of the
try.

coun¬

world.

Some

said

that

the

of

terms

offering

the

bonds

determined until

an

date

and
be

not

can

Securities and

Exchange Commission registration
statement

become
effort

has

been filed

effective

is

being

statement

at

and

made

and

that

to

has

every

file

the

early date.
'Panama in 1950, through Leh¬
man
Brothers, placed privately
$10,500,000 similar bonds in the
an

United States at
with

and

the

of

the

3% interest rate

a

security of $430,000

annual

treaty payment.

Philip Leserman Assoc.
•Philip Leserman, III, President
Philip Leserman Associates,
Inc., financial relations consult¬
the

New

York

appointment

Donovan

young

fornia

sonal

be

day

emphasis

"obvious."

When

I

or

and serve

as

was

vard
lon

•

If you will enter

an

office of

investment firm in New York

an

trading department of this busy organization you
now in his middle 50s
sitting at a wheel chair;
with canes leaning against the arms of the
chair, busily answering
telephones, talking, leading, and directing} an office full of people,
who

some

and

is

have been associated with him for 20

atmosphere in the

an

self into
and

seldom leaves his wheel chair.

of

room
an

or

mere.

cheerfulness, cooperation
During the busy day, amid many interruptions, this

activity.

sky-top

years

of

room

a

He takes his lunch in the

club in his building after he has wheeled him¬

elevator, then through the long hall of the clubroom,

finally with the aid of two

canes

h» lifts himself into his chair

at the luncheon table.

•

Seventeen years ago the doctors told him he would never
get
better and that as the years
passed he would become weaker and
less able to move his
body—there was no more. But when you sit
with him at the luncheon
table, when you talk with him in his
busy office or over the telephone, you don't see the wheel

chair,

you

don't
are

even

only

know the

canes

that there is

aware

that
a

serve

man

as

his

who is

legs

are

there.

living each day

as

fully and completely

as he can—he has erased from his mind the
verdict the doctors gave him 17
years ago. He is still living, doing,

creating and building.

His son. sits beside him in his office, the
who started in his firm
years ago still look at him across the

men

trading table, and he said this to

talked for several hours

me as we

in the restful lounge of this club
noon

high above Manhattan one after¬
weeks ago. "I
enjoy what I am doing. Life has been
I have a fair degree of material success, and every

several

good to

day is

me.

start and

a new

Then he told
a

me

pad of paper and

times when

an

a

idea

a

new

adventure in

to

pencil
comes

on

his night table

to him

he writes

near

it down

Some¬

he won't

so

forget it in the morning. The night he went to his bed after the
doctors had given him the verdict (he would not
recover) he told
he had

a

dream and it awoke him about four in the

morning.

This dream was so vivid he started to
write, and in his own way
he penned the following lines which he
jokingly entitled "More
Truth Than Poetry."

lor

fornia

Symphony Association and,
a registered repre¬
sentative with J. A. Hogle & Co.
Subsequently,

and Francis I. DuPont & Co.

New

1931

In 1936 he became

subsequently President

States and Foreign
Corporation. .and, the
and
International
Securities Corporation. .v
States

In 1938 he became aVice-Presi-

dent and director of
and V
C.

Douglas

Affairs

by

Secretary of
State John Foster
Dulles, on July
1,1958.
This

of

Dillon

ensign

1941,

in

to

1946.

active

I'll place my trust in

him, he'll

up

see me

But this much I

duty.

For

his

services

Mutual

Security

Act
of
1958.
Eisenhower signed the

President

legislation
Dillon

nominated

and

by

introduced

Mr.

Smith of New Jersey and by Sen¬
Mike Mansfield of Montana.
In

establishing

the

new

on

Museum,

Dillon

former Miss

have

they

office

Mark

Conference

and

the/

is

married

the

to

Phyllis Ellsworth and1
two

daughters,

Mrs. ~

Collins and Mrs. James B.

Report on the
Mutual Security Act of 1958 stated Mosely.
that "the new position will
give,
further emphasis to congressional
insistence

that

the

rity Program is
of

Mutual

Francis J. McDonald

Secu¬

integral part

an

With McCorntick Co.

United

and,

as

States
foreign policy
such, is under the imme¬

(Special to The Financial Chronicle)

diate direction of the Department
of State."

Mr.

Dillon

has

been

CHICAGO, 111.—Francis J. Mc¬
has

Donald

Deputy

become

associated

Secretary since January, wi^h McCormick & Co., 231 South
La Salle Street, members of the
1957.-In December, 1957, Secre¬
New
York
and
Midwest
Stock
tary of State Dulles delegated to
that
office the responsibility of Exchanges. Mr. McDonald in the
past was Manager of the Sales
coordinating various parts of the
Mutual Security Program, includ¬ Department in the Chicago office
of Lee Higginson Corporation.
ing both military and non-mili¬
tary programs.
Under

Mr.

Dillon

Graham & King Formed
(Special to The Financial Chronicle)

appointed Am¬

was

BOSTON,

bassador

Mass.

Extraordinary and Pleni¬
potentiary to France on Feb. 27,

King Inc. has

1953.

offices

He

NATO
and

acted

Council

observer

Organization

as

an

advisor

at

for

ficers

meeting of the
European Eco¬

at

in

gage

meetings in Paris
at

16

Court. Street' to

securities business.

a

are

Graham

—

Cooperation, and he has ac¬
companied
Secretary
of
State

an

offering of these shares for sale,

buy,

any

or an

offer to buy,

or a

solicitation of

offer

an

th&Prospectus.

TEXTRON INC.
Common Stock
Par Value 50« per

V

week's

shares at S9.75 per

one

of his

share have been issued by the Company to
July 14, 1958, which rights

/

holders of its Common Stock of record

Not only is my friend a good
pretty fair rhymster. We will

piece with another

Share

'

Rights, evidenced by Subscription Warrants, to subscribe for these

And

that is successful, and inspirational.
investment banker but he is also a

:

'

little

verses.

I

expire July 30, 1958,

as more

fully set forth in the Prospectus.

The several Underwriters have agreed, subject to certain condi¬

tions, to purchase any unsubscribed shares and, during and after
the

subscription period,

like it and I hope you will too.

may

offer shares of Common Stock

forth in the

as set

Prospectus.

(Special to The Financial Chronicle)

,

COLUMBUS,

Kohn

has

Marvin

Ohio

become

C.

—

Yerke

&

The Human Mind

Jerome

affiliated

^

There is

with

Of

Associates,
-

.fji

Hafley & Co. Opens

HOUSTON, Tex. — Girard D.
Hafley, Jr. has formed Hafley &
Qo.

with

offices

tijaeher Lane to
rities

business.

at

5537

a man

story I would like to tell

who for years was in a

cell,

Copies of the Prospectus
the several Underwriters

may
as

are

be obtained in

any

State only from such of

registered dealers in securities in such State.

For

Inc., 40 West Broad Street.
•

:

a

Schuh-

engage in a secu¬
Mr. Hafley was

formerly with
the
First
Gulf
Coast Corp.,
Harding & Co. and
yickers Brothers.




days and nights he'd sit and groan
out," he'd moan,
But, alas, his freedom he did not get
"If I could but get

And all he did
But

Blair & Co.
Incorporated

Scherck, Richter Company
<

fume and fret.

he leaned against the iron door
It suddenly opened; he fell to the floor.
As he picked himself up, thoroughly shocked
one

day

was

as

Bache & Co.

Ladenburg, Thalmann & Co.

Hayden, Stone & Co.

G. H. Walker & Co,

The First Cleveland

Corporation

He realized the door had never been locked.

Many humans like the man in this tale
Lock themselves up in an
imaginary jail,
Yet all they need to open the door
Is discard negative

thoughts forevermore.

Francis I. duPont & Co.
July 16, 1958.

en¬

Of¬

Fred A. King; President;

of such shares. The offering is made only by

through.

&

been, formed with

Hugh J. Graham, Jr.,. Treasurer^
and Raymond W. Thibault, Secre¬
tary.

nomic

above

so it goes—some men
give up when even small obstacles
stand in their way—others call upon their
faith, and the courage
that comes when you ask for it and it enables them to live a life

.

leavet

Harvard Board of Overseers.

Senator H. Alexander

ator

the

member

a

Metropolitan

the

in

He is

of the Board of Governors of New,
York Hospital, the Board of the >

new

amendment

Senate

Medal.

Mr.

fill the post. Provision
office was made by

to

for the
an

at Guam, in Saipan, and
Philippines he received the
Legion of Merit
and
the
Air

389,577 Shares

better, who can tell,
know, I will get well!"

of;

during

,

Though the doctors nod their heads in deep despair,
Their gloom and pessimism I
cannpt share,
As to when I'll get

in

rank

in the

the Depart¬
established under the

was

to

Looking after his children from way
Has planted within us the will to do

t

an;

Reserve

the

Commander

years'

the third ranking in

ment,

Board in

Naval

*

made

was

commissioned

rose

>

Dillon, Read

and

the

the

and

four

.

was

Lieutenant

office, which becomes

new

Company,

Chairman

Dillon

Mr.

nomic

This is not

I:

di¬

a

inclined,

finish this

HNow With Marvin Yerke

the

catastrophe,

more
discouraging lot is hard to find.
They say there's nothing they can do,
To which I reply, 'nuts to
you.'

the

Cali¬

1936.

of

Exchange from

A

University of California, publicity
Southern

member

a

Stock

United

And should get worse day
by day.
The doctors are pessimistically

was

a-'publications

was

"They call it muscular atrophy
Which is supposed to be a terrible
For 'tis progressive, too, they
say

-

Securities

Former Ambassador

his bed.

graduated from Gro-

of the United

living."

that for years he has made a habit of keeping

He

rector and

us.

friends and
•*'"/■ v':'

many

born in Geneva,,
Aug. 21, 1909, the
Douglass

was

on

University in 1931.- Mr. Dil¬

York

preach about what

inspiration to his

an

Foreign Minis¬

ton School in 1927 and from Har-

abundance, and

a

1
■

of Clarence and Ann

Dillon.

upon

for

several

Switzerland,

•

current

to

Mr. Dillon

Eco-

rewards

and go into the
will see a man

ac¬

He

-

the

writing this piece to moralize

the

success

in

tions and financial fields.

the

material

associates.

tively engaged in the public rela¬

for

in

boy 40 years ago you
didn't have to use restraint in
voicing such ideas. But be that as it
is, I want to tell you about a man in the investment business who
has by his example proved that
"living with faith" can lead to per¬

and,

dtiring this period, has been

director

others

had been

meetings.

son

For God in his mercy and infinite love

years

manager

Secretary for

is a growing cancer among the
as a whole.
;It is not good and no
greed, selfishness, and self-centeredness will ever lead

not

am

to

Mr. Donovan has lived in Cali¬

fornia for the past 17

than

Republic envisioned

But I

used

be located in Los Angeles.
'

better

the rest of the world into the
pathways of peace,
the better life the founders of this

City, announces
of William E.

Vice-President

as

Under

as

am

people and the nation

amount of

of their Southern Cali¬
operations with offices to

charge

fare

us

•

of

ants,

of

Cynicism, materialism and
"getting" rather than "giving"

me

Wm. E. Donovan Joins

in

ters

that is only natural. But none of us can be without the
faith that
makes what we do valid and
worthwhile, not only to others, but
to ourselves.
-y'l '
.-w-*'

You

Spokesmen at Lehman Brothers

individuals because I

Dulles

securities, others offer their services, skills, and aptitudes in dif¬
ferent ways that benefit mankind and
help to make this a better

man now

Inter

about such

C,
Douglas
Dillon,
formerly
Deputy Under Secretary of State
for Economic Affairs, was sworn

that most of us (regardless of where we strive and
live)
deep need for encouragement and for understanding of
our-;
place in this brief existence as human beings. Some of us sell

of Panama's feeder road program.

der to Panama

write

who

Deputy Under Secretary of State for Economic Affairs is
promoted to Under Secretary for Economic Affairs as a result
of recent changes in Mutual
Security Act.

a

There

The

I

Secretary of Stale.

investment banker

certain

have

applied, partly, to the redemption
of certain outstanding debt of the
Republic and, partly,, to the costs

from the Panama-Costa Rica bor¬

bear.

ambassador and
,

^By JOHN DUTTON

with

Ernesto

the

Dillon Now Under
Former

Securities Salesman's Corner

:

r

Panama External Bonds
nando

*

con¬

$11,269,-

-;;

19

(215)

A. M. Kidder &

Co., Inc.

The Commercial and Financial Chronicle

20

.

.

.

Thursday, July 17,

1958

(216)

%*Onunwa

iTnm

sponsible for the high wage-rates
for which Alaska is known but as

-

T

J,-.

■<\

promising, over, a greatly expanded highway .sys^
the Territory tern. It needs more main, high-but even more it needs
coast and west to the feeder .roads to these highways to

employment has largely been-re-?.o.utlookMs-:very

•

n/mp

jruui jirsi, yuye

great

sections

■

of

from Southeastern Alaska to the ways

year-long "mptoymeiit * becomes Arctic Ocean
more
common
we. look for
the Alaska peninsula.

:
*

scales

wage

Dozens of sub- open up new and promising areas
substan- stantial companies have-taken up for resource development.:: Our

decline

to

Na- clermg on Alaska-, some 1,250,000 tially.. Most of the industrial en- or have applied for oil leases on
rich in square miles, is now starting on terprises we are seeking for more than 35,000,000 acres of Fedresources
what promises to be a phenomenal Alaska will operate, throughout eral land and many of these comIn addition to this work with growth.
The Canadian sections the year.
•
; S*
' panies ;are making extensive
the Federal Forest Service on the have surged ahead of us as Canada
; ' Industries Promoted - ..
studies of geological structures
National Forests I have continu- offers
inducements * to industry fhp SndnofriP^and have started or-are preparing

total road system, 'of all classes,
now approximates only 5,000
miles. I think statehood will
greatly improve the chances of
more low cost roads to isolated

industries."wns 99% of the area of Alaska
two ' the, resources we want to see deof veloped are. almost entirely under
bout «c55 million each have been Federal administration.By and
estabiished in* the Tongass Na- large we think the Federal GovT
^onaj
Forest area and a
third ernment has been doing a fair job
plant o£ eqUal or jarger size : is in the last few years in making
piajlned,r A fourth
one-half 'as these resources available to injarge ag
0ther three is also dividuals and companies for use.
prospec^
These timber using However, we believe the governr
pjan^s will contribute greatly to- ment.of the proposed State of
working force and to
the Alaska should be able to do a far
ef.onGmv of +be Territory
Also more effective job in getting our
*
J
*'■ 1 --- ----- *
'
- » - -

Canada and Alaska, would be a
great and immediate beneficiary
of such additional- arterial highways into the north country/
'

enterprise

private

Forest

tional

in

applicable

the

with

to

view

a

these

of

so

areas,

legislature, by recent action, has
provided for tax adjustments to

tax structures
stimulating de-

piywood

mills

growth, since my retirement from acres, an area larger than the
the position of Governor last year. State of California, and we can
Today there is a wider and expect that the state will'go as
«nore serious interest in Alaska by far in offering terms which will

Continental United be so attractive to prospective
before. This is users of the resources of its lands

the people of

than ever

States

apparently, to three things:

due,

as-

.

ize

of statehood,

issue

is the

public interest.

Alaska

that

with

covered

associated
five

pagt

with

years

investments

No Boom and Bust

sAlaskans want to avo id the,
chances of getting a"Boom and
Bust" type of development anywhere or for any type of industry,
We believe that this can be prevented by a reasonable amount of
realistic planning and by 'not
-

-

b,

bHc

The

Increased Importance
First

is consistent with the present

and long term

-

Usta Reasons for Alaska's

as

the

velopment of the Territory as a- promote industry which are provwhole.
'
v
ing effective.. Under the statehood
•I am continuing these activities enabling act, Alaska will receive
for the furtherance of Alaska's land grants of over 1!0G,000,000

but rich resource areas. Congress

„

.

ice.

and'

snow.

In aged

tbe problems involved can have
better knowledge of* the action
which will , bring results. Consequently, we are pleased that the
new state is to receive land grants

basis of assured* ref orThe creation-of a new state in our fact, perpetual ice and snow fields estation and sustained yield and
country is a history-making event cover a very small' portion of the thus the mills can depend on havand
does
not occur
very
fre- country and' this is largely con-'jng a suppiy 0f raw material in
quently. New Mexico and Arizona, fined to the high mountains.,'
perpetuity
'
> M
vrhich came into the union as
The whole of the South
' "
etates in 1912, were the latest, be- bordering the Pacific
fore Alaska. The daily newspapers a climate somewhat
.

a

on

' 1

~

possibilities for the- commodity as
shown by careful study. However,
with the " increasing* population
and our even higher standard of
living in America, industry-is con"
at

classed

...

kold producer'

the Alaska statehood bill the continent south of the Aleutian a higher return of his products.
June 30 and it has been signed islands.
-Alaska
long a heavy gold pro-

passed
on

^ and the many adjacent marginal, are now, or soon will be
"lands,.these shallow water areas within reach of the general mar- ,
are immense and of great present ket.
'2
i

^terior Alaska, which embraces ; ^ucer, has slumped ■ greatly .'in 're- and potential value. ^ ;
than half of the country has cent years under the price of $35..
Transportation is often spoken
climate quite similar to that of per ounce,
established in 1934, of as the "Key to Development"
the fact! that aerial warfare has the prairie provinces of Canada when
wages
and' material cost * of a frontier region and this is
fu
US■
reaJ*zatlon and these provinces have attracted v/ere far below present levelsespecially • tiue, of Alaska,: dethat Alaska is no longer the re- vast numbers of settlers and supWater power: is one of our great "ached as it is from Continental
mote
area^so many of us have long ply large and growing industries. natural resources. Huge rivers.and United* ..States by 500 miles and
considered it to be. This is duelfco
"Onlythe Arctic region, covering Wgh iakes offer - opportunities- for shaving, distances withim its own
fjf,
a-rea the Arctic these plants can be interconnected .boundariescountingmuch as chain
Power' plants , and miles,'mot of as the long 1,500
route—the trans polar route—for ntory and bordering ?£

bymthe second feature•
Presif^ntV '
The

i,.
a
i. •*
"*
of interest in

i

transition''

Ocean, has a really forbidding by transmissions lines intosvery ex- served principally by water outare
the Aleutian Islands. We of
tensive power
y s tern
leading
Snt Alaski anr5FheriaTrp ^.lv ob«tac+]f to development.
• down to tidewater ports to pro--the PUget Sound ports and by
^
nfSrr
Ai.
^ A?a^
^ *vide energy there for industides three highways and a railroad all
S
th! m0v,e
18 such as the processing of alumi- leading inland from towns on our
SpfwPAn

climate and dius offers formidable

of

J

nSfo Tn ?

infn

ffib nth^5
AJaska
the past 15
in

years.

tler}.'u0fitat?f
The Territorial

These

had,

the Governor is

dents have poured in from every. Pi-esident.
fitafe of the Union.

-

since

had

have

we

1912

csScdallv"rue of"the

appointed by the

It includes

an

elected

yukon River.

legislature and the usual adminis-'

is

Coal

sitda
-

abundant in

.2

as". a military defense measure,
leading from the road system of
dn the'*:Western Canada to Fairbanks and
Anchorage, is our only land transAlaska Potation connection
with Cori•

the

f

Kcm

,

.

nf

v

n

Z

a,

m

,

...

"fKio

On

nmnl

T

tion and the public miKlir*
demand for and
oil nf Ih

TOS1S OI me economic and cultural

of

attainment

the

equally

oomr-

o

notr

far-

northern and quite heavily poputoted countries of Norway, Swe-

Western

e^ectg<tJ

states but they, came'

through without permanent scars

and
win

f am confident that Alaska'

do as well. A very encourag-

ing the Territory public been iiOL-'
feature is that have revenues
of

im

especially
«

t

•

that
i*>

of

t

coking iog
»,

-

.

:

,

WW

I fto1

.

«

.

Rliffth (vfAIIII flff AFC

iMfW

.

0i£™!' T.he services °f-' Railroad belt. This coal is largely tinental United States.
L* k^
It
fio f5reud
the territory m the field'lignite but some of it is of the .Excellent airplane service is
itnnnaw
o£ h®altb' education and welfare higher grade
bituminous.. On provided to the Pacific Northwest
SS rfniS1P
im
Can beu described as stnetly mod- the south coast close to tidewater a^d direct to the Orient while
a?ern. The usual Social Security and coking coal is available. Alaska local air service to the larger
Irnl
unemployment benefits are also; coal is now used only locally but-towns is available from every
thifSprpaSntf^
in effect.
_
..
•" t studies are now being made by village and hamlet. Nowhere is
thS next SnSS ! ' l ! 'due
Territorial to our are fairly high, large coal developing of the possi- there inheavier travel per includtaxes small popula- bilities of operators Alaska, coal, than Alaska. Everyone, capita
within the
decade and therepart
t'

vexing problems may be

This was-true of many: of our

The Alaska Highway built in 1942

r^onhfodr

n

stabilization period'

.

is power sites on this continent are,
quite similar to that of state gov- iOGated in Alaska and the adioinernments with the exception that; jDg sections of Canada
This is

ment

or

iasting a few years and bringing

creasing at;,a healthy rate for a
long period and continued im-'
proVement is foreseen. The finan-'
0ur 1101,1
which are very heavy users south coast to the largest cities, cia^ problems of the new state'
n
Of power. undeveloped hydro Anchorage and Fairbanks,, situ- sbouij thus prove to be manage-.
Some; of the largest ated in the heart of the country. auie
form of govern-.remaining

....

•

of
course, a tremendously stimulating
effect on the population growth
and regional economy. New resihave

activities

defense

changes-* to Alaska and a

many

i

i

ai

* Statehood , will doubtless bring

more
a

northern territory stems from

our

as

possibly strictly

o

.....

" Alaska

many

were

:

CkarA€

T
OllClttS5
Blyth & Co., Inc., and associates
brought to market yesterday
(Jllly 16) 980,000 shares of common stock of Pacific Lighting

Corp., a utility holding company
whose operating subsidiaries distribute natural gas in 12 counties
o£ Southern California. The stock»
was offered at $47.25 per share.:

trappers and prospectors t
rt
nnrl
rein a+o

_
m
AIIC C JllJjJaUj' nroooses to use
JAI^l
.

j -

jzzmii- industry has slumped badly in the :vnei'e a noay ot water or a sandlion in the fiscal year 1957. It past 15 ,years due to an unex- bar for a landing place is availhad no outstanding debt at the piained decline in the Salmon re- able. The Eskimo has gone direct
end. of that .year. Alaskans are source. Salmon and halibut are from kayak and the dog team to
anu spent approximately

i'

bid

which' foJ, the

3"-

are cstimated at S155 600 000'
Consolidated, operating revenues

subsidiariet

aA,d flnl?nd: I am confident subject to the same Federal taxes.: the prineipal species now:pro- '«>« fWPMf tor aU but his purely ^ t^oomSanv and
Alaska is destined to have as residents
pf^the states and lap ccssed but other kinds of ffsh offer local .travel. _ . . ■
■ ■ ■■
t
,2 mordbs ended May 311
can
easily support in the fiscal year 1957 paid $65 million possibiUties for an expansion of -• Water cargo rates to and from m58 "un™f"264 684 414 anct
American way of living a very mto the Fedeal treasury.
the industry.
Puget Sound have been high,
J9o9Rqr;; 1^3great increase in the present
Verv few neonle think of artri- principally because of the seasonal
I' $
^
population of 200,000. Its potential
*
Seasonal Labor Force
culture including stock raising^ as and
usually . the north-in-the- fo $3.12 per coition s ai, comohould
compare
favorably with
The greatest problem we havei^" potential industry of Alaska but spring and south-in-the-fall char- §aJ
with revenues of $239,615,-

that
«id

„

,

_

.

,

•,

that

of

area

is

fifth

most

Western

586,400

the

United

states.

l/165th that of the average of
Continental United States. Surely
room

here for

growth.
;

i

'

w

Tndnvtriiil Vrnmniinn
,

iNot

of

the

.

Aii

only Alaska,
area

Country,

we

which

.

.

butdhe whole

term

the

"North

includes

the

Northwest sections of Canada bor-




the

experimental work

that*" has f^ter of heavy freight traffic. With

the beginning of such year round
ahd heavy cargo - traffic as now
most Alaska workers., Fishing,., farm and range animals to develop. furnished by the large pulp mills,
mining and military construction strains suitable for northern con- the carrying charges are coming
work on which much of our econ- diti0ns and the importance of this down substantially and through
omy now rests arelargely season- industry in Sc^^^
freight rates by water and rail
able industries. • Consequently a beria show that agriculture can be from Alaska points to the midwest
large percentage of the men who^Successfully nrncticeci in sub arctic and eastern seaboard of the
are employed on Alaska projects,. regions
United * States can now be oblive in the Pacific Northwest and
'
' ,
tained. These better rates are resPend on^y
working season
Petroleum Prospects „
cen^ developments and indicate
°f eight months or less in the ter-.
The greatest thrill in the past the changes which are taking
vaiHng

with a present
population
of
only
population ratio per
mile is approximately

plently of

striving hard:

Continental

of

States,

tiiere is

we are

to overcome results from the pre-

year-round
200,000. Its
square

mid the one

miles, one-

square

area

Its

seasonal

employment

of

been

donp

Ss

and

anH

is

foraee

hpint? Hone
crons

anl

on

oh

^«42 -p« SsrodiSM

Per snaie aurmg me cai,
endar year !957. • ->Jj

°r

"gpXmon
°!
since

while

residents

.permanent

have

to

stretch

months of wages over a

period

of

living.

Alaska few years to come to us who are
eight working for Alaska development

12-month has
This seasonal for

place in favor of the installation
of Alaska enterprises to supply

resulted from the prospects outside markets.; ":
petroleum production.
The
Alaska/however, is in need of

stock

Tn

each vhar

f L o,? in-o «
f
^ a

quarterly dividend of 60 cents pejr
shaie was declared.
:
f *
.

_

-

ritory,

G

•

.

»

WifK SAKwerin

Stone

WlthOCnweril^ 3tOHe

Great Neck, N. Y.—^Schwerin,
Stone & Co., Great Neck Road,
members New .York Stock Ex"

change, announce that
Jacobson has become

with them.

Donald JX

associated

.Volume 188

Number 5760

.

.

The Commercial and Financial Chronicle

.

(217)

Continued

from

page

15

months, should ■ produce
better
earnings and also bolster the cash
position.

Where Do Drop
In the

Keenan & Clarey Branches
•MINNEAPOLIS,
,.

tomer's products.

ating

It includes

markets.

new

7

/

'

r

This year the editors of "Steel"

cre¬

i

:

have been

>

-

has

done

out-

an

sponsoring

competition

4

on

step- out

job.

.ways

//

industry .offers

one
num

Co.

its

ago, we had only
primary 'producer of alumi¬
in the II. S., The Aluminum

of

America.

It

us,

servative.

a

vastly expanded^ demand

a

aluminum to build aircraft..
reduction ;

plants

mills

find

it

difficult

of

cause

reluctance

a

trade secrets

or

to

methods

had

is
is vour business. Hut. T am
your business, but I am
always reminded of what a top

executive

of

Du

Pont

told

me

is
Possibly,
your,
association
trending toward revealing to each

war

ended, demand practically. dis¬
appeared. We thought it would other and to the dublic more intake a generation or two before formation that, vou once. rrinsidformation that you once cbnsid
demand could catch up with sup¬

ered sacred. I believe that you are.
But I do know that when J was

ply.

.(«. But Reynolds, Kaiser, and Alcoa seeking
set

out

and

they

to

develop

create
were

plant

we

markets

new

demand..

new

Soon

,

7

;

.

figures for today, I
tough time getting

some

rather

a

them. Z

utilizing all the surplus
thought we would have

|o junk and were building
capacity..

had

•

Firiallv

•'

"

dustry

doing

to

.

you

.

u

are

vyiue

up

wito
wilu

,

mucn
...

as

fold increase in two decades. And

■

^

-

is/, only

So l suggest that, as an

.

pay

;/\

more

Product Improvement

press,
and

'

*

the public,

your

doors

r-rr

fthe

customers*

your

suppliers.. • / '*11

:*c S

Those are some
that I believe the

/

^ebond, I suggest that you continue to pay heed to product im-

south and the Great Northern
on the north, These three

jn

**>

,,

connections with other railroads
It

feet

high degree

a

age,

car"

in tne service -territory.

.

The

;•

riei-s in the service ferritoi-v

back

For some.time the management

double track

a

.

.

Western
its

on

.

Officers

President* B

C

B.

With Merrill Lynch
(Special to The Financial Chronicle)

route,

/

ambitious

21»

CINCINNATI, Ohio —James O.

Hillyaid, Jr. has been added to the

staff of^ Merrill Lynch, Pierce,
tenner & Smith, Dixie Terminal
Building.

this mile-

.

Pacific

business.

Leff

has

at

en<*a

Scougall, Vice-President.

City, ..forming

over

offices

>

teff, Secretary, .'and Stephen'

connects with

Lake

The

Corporation

with

securities

Mark D

^w—«.
Grande West-

transcontinental

formed

Corp.
Calif

Cr»M,>YQii

are paired with Southern Pacific
used jointly by the two
roads giving both systems in ef-

at Salt

part 0f

a

are

x

(he Denver & Rio

ANGELES

North Carolwood Drive to

with the Souther Pacific for traf«vrx^

Opens Investment Office

'

has

Benner is engaging ip

improve-

a

securi-

ties business from offices at 7252
meht program to cut down ex- Limekiln pike. Mrs. Benner was
Penses and this, coupled with an formerly with Auchincloss, Parker

^as ^ad

'
intensive drive to
attract new plants to its right-of-

^

UPtUm in traffiC over cominS & Redpath.

aP%learsMncludin^ ^e
enlarged'their facilities.
sult- tonnage roriginatG.d

As

on

?

;

.

'

re-

r

line *is

a

a

will have

of-the. problems
forging .industry
to tackle if it is to jstay

:

increasing iiYimpoi'tance;'From a
2,300,000Mn 1949/tohnage -•
originated Ireadhdd a hew peak of '■
low of

2,867,000 in 1956 and declined Only
slightly to 2,851,600J in n9.57. °. It
might / be' noted •' this was welj
hbove the vojume originated durIng the-'Kpreah War period/ 7;'r ♦
/

'
'

-

!

-

.

Thbleoinpany/owns weli-sitUr
industrial acreage which it is

/

ated

(

expanding.. It is ih.a good position

Rotable progress al¬ ahead in the race that will charac- to further inbrease originated tonhas been made by your terize the new economy—a grand nage as a result of exfiected conIndustry in designing out weight, economy Horl those prepared to "tipued growth-M [ the territory
in surface improvement, and-in fulfill its requirements.
/ ; /
served//Last year 61% -pf total
.•
meeting closer tolerances. / More
/. J
/ tonnage was derived from connecwill have to be done,/,• //;•.
■i
rii
*7
_/ : r?
tipns ,and, consequently, the road
J. T• Magurno Forms Co.
still has a loiig way."to go to estabr
/ We are moving inevitably to¬
ward a hiore automated industry. ;
CLEARWATER, Fla.James Ea better,'traffic-balance/West•If ypii don't like, the word auto¬ Magurno is engaging in a
s^curi-. ern - Pacific t might receive some
mation, call it four roses/; But ties business from offices at 601 important traffic front its whollyproy enieiit,"

ready

r"

"

*
•

-

'

J

that

as

your

customer

Court Street under the firm name
of Magurno and Company, r Mri

Northern in
increases his mechanization, even
;the future: Earnings of the latter
minor dimension variations will Magurno - was
formerly with ;are / not presently
consolidated
'not be tolerated.
v
:
Pierce, Garrison & Wulbern and with those of the parent company.
1- ^ Third you-will have .to handle
Leedy, Wheeler & Alleman.
;
The Sacramento. Northern,
the newer materials and metals.
which was reorganized in 1956,
You already ere doing an excel¬
has been undergoing a rehabil-itar
lent job on the special alloys of
/Form Public Development tion program, including the aban"steel,' titanium, .' and aluminum. / PHOENIX, Ariz. — Public Der donment of
unprofitable mileage,
But new metals and materials are
velopment Corporation has been This subsidiary, which is debt
coming across the horizon regu¬ formed with offices at 2300 North
.free, had substantial earning
larly. You'll have to learn to work Central Avenue to engage in a se- '.powef' during World War TJ and
''!ivith them.
*
•
: curities business. Officers are
Rob-'the Korean conflict. Since
owned

;

f

'

.

Temember

-

f

;

,

Unit ad Press international

Sacramento

•

Fill TR UP.

-

1'.
■

.

outstanding

orL C.

v

Bahamian, -Jr., President; dime /earnings have, been down
assures me that we soon will be
George B. Sharp, Secretary; and and also have, been badly effected ;
"forging ceramics.
At first, that Paul
Totel, Treasurer. •
:
^
"by a number of floods.
sounded pretty ridiculous, but I'm
*
'/.•'*
;
Cash resources, although ample, .*
not so sure he was talking through r>
i
m m
***
'-■*' k
" * '
have declined in recent years. On his hat.
"
rorm J. M.
lenney Assoc. April 30, cash amounted to $2,J j. Fourth, you will have the con¬
J. M.
Tenney Associates, Inc.
tinuing problem of cost reduction.
has been formed Avitli offices at
/'taled $13,052,000, while $4,506//This is * a problem that you can
525 Fifth Avenue, New York City,
?«> was "held -in speaai deposits ,
I/pever lick. .But as an industry, as to
engage in a securities business. t°, cover. Federal
income, ,taxes ;
/well as individually, you will have
offir-prs
arc * Tprrv
M
Tcnncv
accrued and other liabilities. Net
/ to keep pounding away at it. You
President; Ira J. Hechler,
: working capital mounted to $4/- •
can be sure your competitors will
9^!? ^rom $5,833,000 at
be finding ways to improve their urer; and Robert K. Lifton, Secre- •
tarv
.the end of 1957 ,and $6,422,000 on
efficiency.
April 30,- 1957.
There are two
.1 .Now, while business is somesources which could bolster cash
what less than pressing, it might
James F. McDounell, Sr. during the balance of the year. The
i;be a good time to take a look at
.cash flow from depreciation is
James F. McDonnell,- Sr. passed
f how to lower your unit produc¬
^ estimated at $3,540,000 compared
tion costs through the introduc¬ away July 10 at the
age of 78" with -equipment trust maturities
tion of more efficient equipment,
after
a
long illness.
Mr. Mc- this year of $2,140,000 and sinking
/"the better arrangement of equipDonnell was the founder of Mc-•
m^nt you now have, better ma¬
The
second is the possibility of a sizeterial handling, and, of course, Donnell & Co. which he estab- a^je tax refund
claim arising out
-

.

.

.

.

,

,

.

^

.

TreaS

.

^

better methods.



„

„

:*v

\

*

•;

•

.

'

A

J

.

i
_

Rockets

.

'

,

;

;

.

fiy 'out of this world'

on

high-

high-energy fuel plant in America

Blaw-Knox Resigned and built the nation's first high-energy
jthen pioneered with a fully-integrated
plant for commercial production of boron chemicals. In fact,

fuel plant in 1949

...

for its clients Blaw-Knox has

designed, built, or performed
full-scale plant in the country for
making boron high-energy fuels that are propelling America
inspection work

on

every

into the space age.
But then,

.

/

,

pioneering throughout industry is

a job that
Blaw-Knox is geared to tackle. What are your company's
plans? If bigger profits can come to your company through

advances in rolling or fabricating metals

in road building,
chemicals, processing or communications—Blaw-Knox is the
forward looking company that can help
you. To find out about
our
products and services for industry, send for our brochure
...

"This Is Blaw-Knox."

^

,

_

'

full-scale

that

metallurgist

i

energy fuels-Blaw-Knox pioneered every

'

One

-v

..

Pre-launching fueling operations for Jupiter-C, t

—the rocket that carried America's first satellite into orbrt.
1
'

'

..

_

,

.

,

.

lished in New York in 1917.

,

,

f/"^u'rhema^.^*720'?00-

of book losses sustained in the

re-

;

PHILADELPHIA—Mrs. Lennie

cut-

+~

.

v

;

your

to everyone

heed to market
development and markehcreation.
you

That certainly looks like an in4

dustry job, and it ties in with the

; suggestion for opening
industry, a little wider
.

HiW*'

number of/existing plants'haye

.

industry,

Mprtr"
__

sieenv

—RX

First Angeles
LOS
been

Western Pacific is dependent to
the extent of about 6Q% on its
a

..

Fnrth-

and at 1090 Ohio Street, St. Paul,

About 183Cal and Salt Lake Citv
miles of line between
Oakland

fac^d with

H

Mirm

on
on

year^ would^reppesejit amortiza-

large part of its traffic.

Minn

under the
„

Theo

of

the Pacific. First " Angeles
with the

era

is

Minn

„

tion

connects

SI If' a Js estimated that more
than $2
share in each of .the

a

Shakonee

large Ford Motors assembly plant
^ Mflpiia^,- CaL : In addition "

.

the aluminum
getting started.

x*.

«»d8 are In ««ct. competttton

«p0

..

traine^eng^Lews^ali 'yow^l

*

New Ulm

T*'-

directionofTnhn
•

under the management of Quintin
J- Thul.

a Ac- -The main line
fic. The

also

Minn

Bye, Minn., under Donald Schmid;

3

for

Jr

Duluth

der the direction of Richard

Railway

a?roue?$5
as

u?^dT^a^/^

..

Banks

S

thp

Emerson-

Underthe

.

Atchinson. Toneka & Santa Fe
Atchinson, Topeka & Santa .Fe

...

trlined Siv

attract

.

personnel? In visiting technical
familiar with colleges, I have
the story of do-it-yourself alumi- few courses in
forging.
ging,TTnis,'ta sesnum» Of aluminum foil, aluminum
boats, and many- other applica¬
;fa
gmeeis. Can you /use
tions.
.,:'//./> '
universities to
help you tram
>ti Last year, we produced 1,650,000 people. Are you doing enough to
jons of primary aluminum, an 11- help the universities?
r? "> ,/ *

Most of

v.

-j

share
snare reported m l«a7. lit these
in 1957. Of these

.

there is the problem of

balance of the year will

.

,

„

•

nlJI whi l thrE i!

new

Gordon

Pacific

e/mlngs compISs northwest. It
comparisons SwittwnitWmmta to
f?

t

•

...

lindpr

Minn

comprises
1,200 miles of road, extend-

R uwkhowings w:ith a the

course,

New

that

the
m„va

pnnrsa.

for

finishing

.When

Western

•

disclose

and

three.

h

That, of

with4 govern-, years ago: "When you lock the
with private; door, you always lock out more
than you lock in." "
:
:
Instead of one producer,

capital.

,

to

built

were,

merit, money

we

and

v.

We

;

Minn. —Kee-

ing fro'm gait Lake City^to^the
Pacific Coast, with an important
112-mile line running north from
Bieber to Keddie, Cal. This is a
part 0f
"inside route" from

return of around 6%.

Jjmanage-

•

con-

really good stories from the
6Uouovowooxromtuo
Industry. Generally, this is be-

World War II and

came

industry is pretty

obtain

duced 146,000 tons of aluminum.

\ Then

a

Foi/the first fiye months of this

^aar, the, rogd reported net income
no
a share as compared with
a
in ,"e hke period

knowledge and information. To
and to other editors as well,

the forging

fairly
progressive company and enjoyed
a steady growth.
In 1937, it pro«
was

.

/ Fifth, I suggest that the forging
industry learn better how to share

a

i Two decades

v

brings

The

some

,

"

•_

.

Pooling Knowledge

example.

reverse

:

.

.

tastic.

outstanding

an

•"

The aluminum

good

an

do

and

-V,

:

■

Wn&g

Western Pacific Js. one of the1 organization of the Sacramento
few select.roads which iq expected. Northern. It is believed the subtp maintain its dividend rate this sidiary road has a comfortable
year despite a drop in revenues cash and working capital position
and earnings. Currently the car- which could be drawn down by
rier is, on a S3 annual dividend "Western Pacific as nooriari ;
rier! is .on
$3 annual dividend Western "Pneifir. oe needed.
\
basis/ which
at
basis, which at current levels

use
of
more
efficient
capital
industry, in
that area. And where an industry- equipment. Some of the savings
shown
our
by
our
is conservative, at
contestants, * all
appears to be
g
difficult for a single company to metalworking companies, are. fan¬
fan-

as

Western Pacific Railroad

.

,/v/

.

cost crisis

a

to reduce
unit production costs through the

j Frankly, I doubt that the forg¬
ing
industry
standing job,

21

BLAW-KNOX COMPANY
1231

Blaw-Knox

Building

•

300 Sixth Avenue

Pittsburgh 22, Pennsylvania

The Commercial and Financial Chronicle
22

Continued

under\°VutM

from page 5
a

Time Is RnmilllQ Out in.'
T_.

WAT

aims in

mm mm

viewing

in

perspective

;■

^the^eco-

since estimates, the Soviet economy is
consolidated his in- graduating each year about twice
ternal power in 1928, and launched as many scientists and engineers
develop- the first Five-Year Plan under as is the United States. This is

has emerged

Soviet Union

economic

of

programs

draft. This gain in output

nations of

the underdeveloped

was

tell, these Soviet foreign aid pro.are now involving something of the order of half to
three-quarters of a billion dollars
grams

year.

Takes U.S.S.R. Boasts Seriously

as

know,

we

consent. A Democratic Senator who has been supporting the President in these programs reports

•

fh

national

the real Soviet gross national production has been grow-

War,

rate of about 7% a year,
This
is
a
rate
approximately
twice the rate of growth in the

ing at

a

potential

;

than

'
as

^

"This 'S ^ Proposition put in the

.

-

if the Communist challenges

^

+

not

simplest of

terms, the President proposes, but Congress disposes;
less

military adversary, we
recognize the Soviet

it

Congress will not support the President unthat public

convinced

is

iMf]prq

prnn

of

thp

opinion is

nation

his

on

official

and

equally formidable

sKte, ergo, tile ieaoers 01 the nation omciai ana
unofficial, must rouse the people so that they can

adversary in the global economic

in turn rouse the Congress."-—Lester Markel, Sun-

conflict. The productive power, of
the Soviet economy will continue

dav Editor

should

now

Union

as

y

it

economy

—this is

can

Congress

the point I'm

coming to—to support a massive
period in which the babies born program of technical assistance
during World War II and imme- and development loans to other
diately thereafter will be reaching countries that it wishes to bring
working age. We know that the within its orbit and to satellize.
Soviet birth-rate in those years
Apart from their rapid eco-

in the New York "Times"

'

There

rapidly, in all likelihood,
will enable the Soviet

to grow

&nd

an

be

no

doubt that

vox

populi controls

and most politicians. And there

fnic<k

w

«iAa,Wc

are

so

UkA

many taise . leacters or tne nation
Perhaps the fault will be our own if we presently
become underlings.
■

—

—

the Soviet Gov- trade and investment that will
Government does benefit ourselves as well as the
yeiy
g£,* ^9 certain advantages in this eco- not draft able young people as peoples of these other countries.
our own coumry will sut- n0mic conflict that we're faced technical experts for its foreign It will foster our own national
:ne salJ)
iw1
with that we should not overlook, service.
security and raise our own standp„■ £. £JS? P., In the first place, the Soviet econr
ards of living. The purpose of
soviet union, wnicn pore xne luii omy an(j those of a good many
Our Advantages Cited
our economic assistance to underbrunt 0.1 tne ijerman attac
underdeveloped countries of the
We should bear in mind our developed
countries is not to
^.J
world are more complementary handicaps as we go into this eco- "buy" friends. We provide ecoUnlike

abroad.

economy was very low, and that the infant norrdc growth, the Soviets enjoy ernment,
mortality
was

w!Jtt

World War II.

since

'

f»nnr

in these areas so vital to us were foreign and
national—more than that, local—concerns.

developing

that

know

economic

the

.

rather

a u*

growth. Just as we have learned,
through Sputniks I, II, and III, to
know the U.S.S.R. as a formidable

will

f ,

•

attention

have

must

incredibly remote,

Kate

Sees Slower U.S.S.R. Growth

to take the boasts

cause us

of Khrushchev and the Communist

-

t

aid

■"

Fmnnmir

tt sj < r

•

output of the Soviet
economy continue to grow at this
Party
seriously?
I
think that, fantastically high rate of 7% per
when we look at the facts, the annum? I think there are several
answer is a
rather sober, "yes." reasons for believing that the fuWhile reliable economic statistics, ture growth rate will be somewhat
comparable to United States less than it has been in the past. In
figures on our gross and our net the first place, beginning now and
national production, are lacking continuing until the late 1960's,
for the Soviet Union, all of the the Soviet population of working
expert studies on Soviet economic age will grow relatively little, if
growth converge on the conclu- at all. The reason for this is that
sion that since the second World we
are
now
coming into the
growth

f

needs

"fnrpicm"

Explains U.S.b.K. Economic
Advantages
.We

-i •.

h•

"At the Capitol such international problems seem
,

F

±

mat nis mail p.s run lour to one against ms course,

he is notified in unconstitutional language (to which
the Republicans at home cdlftribute) that local or

course.

industrialization.

'facte^a^t^vleT'ectnom^c
;

brought about,

hut

aid and trade

_

because
these
graduates will support basic research on a much larger scale
than will our own country in
future years, unless we change our

by

on

*TS ^
°r vigorous acuon pn aia ana traae, our
the Congress has given hesitant and diminished

important,

most

ruthless suppression of personal freedom, and by the starvation of millions of peasants, who
were forced to deliver their farm
products to the State in order to
supply
the
industrial
workers
with food in this period of forced

So far as we can

Asia and Africa.

first

forced

technical assistance

aid and

ment

Stalin

over our

has called for vigorous action

that it is only about 30 years

an

as

important factor in world trade,
and it has launched far-reaching

as a prime example, the continuing
international position. The President

*'Consider,

capaci y.. ..
,
One of the most important facts
This
is
a
very
impressive for Americans to understand is
the achievement, considering the fact that, according to the most reliable

that

is

times

recent

as the laws of physics permit. If public opinion is
sound, and if it registers, the Congress will respond.
jf pUblic opinion is misinformed or mute,

issue

out, we -are stepping on your tail,
One of ^the remarkable facts of
very

„

..

strong-lunged minorities will have their way.

is probably between munism. Nonetheless, we would
40% of that of the United be foolish not to regard them very
economy
operating at seriously.

language when he 35 and
-will taury you. Watch States

VWAWVAVvaii

wiP

•

decisive, and omy today

more

even

flamboyant,
said: '"We

VVIU

«lvirllVlil*V

AOv

Thursday, July 17, 1958

T,At IJc SaVA OfllSfilVCS!

1920 under democratic capitalism.
We °u^t to not lose our sense of

Hf

■p||A PfiJIVIAmi#1 I.AM

a

.

'Jhef Congress keeps its ear as close to the ground

Ull

■

■■

oT°Com-

form

munism probably hasn't been any

.

to

..

(218)

our

„

The high Soviet Srowthrrate in
recent

years
has been brought
by several factors. In the
first place, there has been a very
rapid increase in the labor force,
the number of people at work on'

.

about

..

~

.

,1

than

Soviet farms and in factories. The
has

annual increase
tween

million

two

and

one

which

sons,

ranged

about

is

1r

be-

has
v

In the

second

in the

been

Union

people,

^continue today to

lack comfortable

housing and the

transportation that the people
western

that

of

the

Soviet

Union

reSarrh

on

and

caUoiT'^and'° technical'"
technical
cation

of

He

training
tiaining.

and

,

forced

to

in
li

tiif outPutPpermaThour
output per man-nour.
As

a

result

of

provements 0f their

+anf point

of

war

Union is

now

million tons

steel
this

an

of

capacity is

ducing

at

now

as

steel

a

more

we're

the
The

recession.

year.

Our

than double

actually

present
Soviet

as

pro-

time

of

Union

is

producing

about
80%
as
much coal as we produce.
The
most recent figures indicate that it
Produc*n£ more machine tools
than

we

?

The rise

own

Soviet

that the

vou

economic objecsimple

'

to

one

Un:ted

states9

the task

But

what

objective?

is

our

have

We

formulating new economic objectives for ourselves. As
the

Soviet

economy

moves

up,

becomes
needs

will

oriented

more

of

to

the

the planners
against these diffi-

consumers,

come

up

cult and fundamental problems of
what consumers want.
We should not exaggerate Soviet
achievements. A number of myths
have been fabricated, cultivated,
and

are being spread in the world
which ought to be punctured. One

are

.^figures

consumer

goods,
of
cars
and
refrigerators and home appliances
and all of The services and
„

goods
x

.

the other nomic assistance because it is in

on

As

a

result,

it

is

often prefer to sell their goods for hard

The gains that the United States
make

can

freer

trade

and

want. Our system of private en- World's population, go far beyond
the second place, the Soviet terprise, competition, open mar- our national security in a military
.

Union can and does cut prices m kets, and freely convertible cur- sense, by which I mean getting
order to foster trade for its politi- rencies is, therefore, one that has u. S. bases abroad or preventing
cal ends.
Our foreign
trade is a very basic appeal throughout the Soviet Union from gaining

to meet, and who can't cut prices ern

world. Many nations have foreign bases. The benefits that
the course of events in East- we can obtain are necessary to
Germany

and in Hungary.

for political purposes. They haye They understand that heavy deto make a profit or at least avoid pendence upon Soviet

0,ur continued economic progress.

May I call your attention simply

trade leaves to two facts.

First, the United

loss to their that a State-con- themindependence of their politi- materials of neutral andthe raw
stockholders. This cal open to a loss and to their states urgently needs uncom1S something

United

States

to

do.

This

solutely false. The Soviet
was

about

as

advanced

.

is

ab-

economy

as

trolled economy need not be con- ultimate

United

cerned about.

satellization.

^

So

our mitted countries throughout-this

Another disadvantage that we
face at the present time is that
a

larger variety

of goods suited

to underdeveloped countries than
is the United States. By and large

vantages of freedom of enterprise
and freedom of trade throughout
the world, with which personal
dignity and political freedom are
closely allied.

equipment is of advanced desuited to U. S. conditions,
Soviet equipment, such as their
What should we do about it?
'automotive equipment, trucks, There is not time here to trace
cars, etc., is simpler, more rugged, all of the elements of the program
more easily kept in operation, and of action that the U. S. will have
better suited to a primitive coun- to evolve to win this economic
try.
war.
Perhaps, I can put forth a
The fourth Soviet advantage is few thoughts about the nature of
even more important. The Soviet such a program.
*
Union sends its technicians along '
with its goods.
I met many of' Sets Forth Suggested Program
our

sign,

.

_

in India. They are trained
It is absolutely essential that
in the language of the country to we Americans understand the eswhich
they go.
They can be sentiality of binding more of the

them

"

...

--

rubber of the Malayan Peninsula
and of Latin America. We need
the nickel, bauxite, iron ore and
pulp of Canada and Brazil. Looking to the future, we know that
the great undiscovered raw materials of the world lie in these
neutral and undeveloped countries of Asia and Africa. Can we
allow them to go behind the Soviet Iron Curtain?
,
Secondly, the underdeveloped
countries offer huge potential
markets for American products.
As we become a more highly industrialized society, we shall need
larger foreign markets for the
products of our industry in order
to

f

_

_

_

for the rising
materials that

pay

raw

average the goods in the producof which they're moving up

from

proper course of action is to over- WOrld. We are no longer selfcome those handicaps that we now sufficient. We need the oil of the
P°sscss, and to spread the great Middle East and the Caribbean,
it the Soviet Union is able to offer moral, political, and economic ad- we need the copper, lead, tin and

catch up to! We have

of

currently producing, hears it said, for example, that the
alone are highly Soviets have done in 40 years
misleading, because the output of what it took 175 years for the
These

But,

'o™"late—to catch up with the a

machine, 7the Soviet will, I believe, face real and difproducing about 52 ficult problems. As their economy

amount, but this is about

much steel

-

supports

course,

immense

the

im-

Has it occurred to

nobody to

single-minded
heavy industry,

nomic conflict.

Sreat as in the '"ture.
conducted, as it should be, by the
I think this is a rather impor- Private enterprises that have costs seen

economic

a

drive to build up

which,

*

:

tne

their

unon

technical

find

^

extraordinary tacreare'lirthemn^
mcrease in the an

with

easier for these underdeveloped currency, for money that's con- investment throughout the Free
coun.tries to find a basis for com- vertible into any other currency World, including those underdemodity trade with the Soviet which they can spend anywhere veloped countries which include
Union than it is with the United and for the products that they about two-thirds of the Free

UD

knowledge, which they have been
able to utilize heretofore, they will

? reseafc" and de~

J?

USA

P^^amng upon the

would

Sovtet*Union a"vervShiehVate

years.

increase

to

onnortunitv

normally expect to have. In the

exnenddure

Soviets

th

aq

Dr0ductivitv bv drawing

as
as

as

economy

prices at high levels ov^r many usaally insists uPon- Most nations

con-

g

S

° Finajlv

o?a

Westeni^^mmmv as^3roductfve
economy
productive

S.

s w i i- things to dispose of, as a result do not like to barter, which is it can be independent of any forof our short-sighted policy of sup- the form of trade that the Soviet eign domination, including domiporting
agricultural commodity Union with its Socialist system nation by the United States.

demanding better living

capital accumulation.

This has been achieved by holding
down "the
consumption
of
the
v

±

f

a

vei7 hlfh rfte ?f g^wth in in-

vestment and

g.

nous

place, there

Soviet

U.

hand, America and the West our interest that any country in
possess very important advantages the
world is economically >and
' The U. S. has surpluses of these over the Soviets. Most nations politically strong enough so that

_r* e J ;

the

annual gain in the U. S. working
force.

the

coun™' c™a ~"tries, Russia needs food and fiber,

"®CMsaiy,»

per-

double

is

" those of the underdeveloped

from abroad.

volume of
import

we

We cannot permit

relationships. I dislike the phrase these markets to go under Soviet
has
achieved
about
large, are poor linguists.
Eco-' "foreign economic aid."
It's a domination.
<
~
rapidly
those
in
which overall stature as the U. S. econ- nomic
opportunities are so attrac-- misnomer. What we are talking
I can only sketch here the main
theyTe backward, the aggregate omy had achieved in 1920. If
you tive
at home that it's hard to. about is essentially American eco- elements of the kind of bold, but
real product of the Soviet econreally
look
at -vthe
facts, - the attract
able,
young
Americans nomic aid, because it involves sound, program that we shall have
tion

-




years

later,

the

Soviet

economy
the
same

equipment. We Americans, by and

.

Volume 188

Number 5760

.

.

.

The Commercial and Financial Chronicle

23

(219)
to work
cold

to win the

out

economic

war.

First,

need

we

moval

of

progressive

restrictions

on

Public

re¬

trade,

other restriction. The other

or any

countries

the

of

world

have

of

the

Reciprocal Trade

Agreements Act by Congress

was

one of the most hopeful and in¬
spiring events of recent times.

Secondly,

businesses

abroad,

more

vantages
that

be

by giving tax ad¬
by other measures

and

can

Thirdly,
other

need to encourage
to
invest

we

American

devised.
need

we

countries

climate

to

for American

codes

persuade

improve

by the adoption of
ment

to

the

American

proper

invest¬
fair

assure

treatment of the property of for¬

Electric Power Com¬

properties of subsidiaries

are

con¬

centrated

largely in Ohio and
Virginia but also extend into
Indiana, Michigan, Virginia, Ken¬
West

tucky, and Tennessee.
lation

of

are

the

although

served.;.

The

with

cities

large

no

assistance

to

programs

help other countries learn how to
capital

use

thereby

efficiently

more

and

System
35%
and

is

rich

a

with better salaries and
stronger inducements to capable
and dedicated people to enter it.
Fifthly, I suggest that we ought
to enlarge our own United States

revenues

in

1957

were

residential, 15% commercial
39% industrial. Average resi¬

dential usage

correspondingly
kwh vs. the U. S.

was

high at 3,587
of

average

3.174

kwh.

The

sys¬

tem's low rates reflect

outstanding
generating efficiency. The produc¬
tion

cost

of

which
generating one kwh
up at the last session of in 1957 averaged only 2.57 mills.
Congress, and which finances nonThe system has grown rapidly
bankable but economically sound in the
postwar period, revenues
development
projects
in
other increasing from $103 million in
countries of the world.
1945 to $284 million in 1957. It has
Sixthly, I believe that we should under way an $800 million fiveDevelopment

Loan

Fund

set

enlargement of the
of the International
very successful institu¬

an

sponsor

(1956-60)

year

program

gram

Bank,

taken

a

construction pro¬
largest ever under¬

the

—

by

electric

an

utility.

Of

tion which finances bankable de¬

this

velopment projects throughout the

expended in 1956-57 and $180 mil¬
lion will probably be spent this
year, leaving $328 million in 195960.
By the end of 1960 the ag¬
gregate postwar expansion pro¬

world; and that, concurrently, we
should also sponsor the

establish¬

Economic

Develop¬

of

ment

an

within the United
Nations, to foster economically
sound but non-bankable develop¬
ment in the less developed coun¬
ment

Agency

Now, it will take time to do all

But time is run¬

of these things.

We would be wise to
more rapidly than we have

out.

move

If we do
then I have con¬

been moving in the past.

rapidly,

move

fidence that

we

shall be victorious

in the economic conflict in which

joined with the So¬
Union.
The society of free
and free institutions must
now

are

we

viet
men

Company, Inc.
with offices at

Herbert Perry &

formed

been

Wall
act

stocks

Street,

and

and

York

City,

dealers in

Officers

bonds.

are

Perry, President; Harold

Wolfe,

Vincent

New

brokers

as

Herbert

P.

Vice-President;

and

Barry, secretary-

treasurer.

types is—and has been—traveling
along the same road for soma

temperature with "double reheat,"
the new unit is equipped with a
gas-cooled generator, stator and

now

rotor.

It is

the forerunner of the

Diamond & Co.,
York

New

York

is

expected to reach
or

is

about triple the
estimated

that

this will give the company a 12%

margin above peak load.
The program called for installa¬
tion of six 225,000 kw units this
reserve

year

and

450,000 unit in each

a

of the two following years.
The

company's

growth

tied

is

the

rising cost of natural gas in
south, the aluminum industry

120 Broadway,

City, members of the
Stock Exchange, on

August 1 will admit
Maged to partnership.

With Andersen,

Louis

F.

Randolph

year or so

space-saving

will pro¬

through

thermal

and

effi¬

the combined gas

and steam tur¬

bine cycle, etc.
In the field of
high voltage transmission, it has
now
completed its 345,000 volt
interconnection
wealth

with

Common¬

Edison.

-

PORTLAND, Oreg.—George R.
Hulbert

is

now

with

Increased
efficiency is being
sought in other departments.
in

Work

electronic
accounting
a planning group is
developing electronic data process¬
ing, which may finally result in a
single electronic accounting sys¬
continues and

tem

the whole system.
Cus¬
billing is now being done
new electronic computer sys¬

for

tomer

by

a

tem in

a number of system offices,
being extended. Digital
computers are also used for engi¬
neering and operating applica¬

and this is

tions.

dividend
each

in

rate has
of

the

been

past

years

increased

five

years,

from 95 cents in 1952 to the pres¬
ent $1.60 rate, which in January

21/2%
Earnings for the

supplemented

was

stock

dividend.

by

.

.

partner in Dillon, Read &

Co. and later in Lehman Brothers.




am

stagger

imagina¬

ended

May

31

would add about 72 cents to

ings

on a

earn¬

cash flow basis.

The company

did equity financ¬

ing in 1949, 1951, 1952 and 1953.

many

Retail
banking, practically
un¬
ways.

—

a

with

Kaiser

and

continue

called

R. E.

Meyers Opens

FT.

WAYNE, Ind. —Robert E.
for Meyers is conducting a securities

and prosper.

has

been

well

said

that

the*

bers. Our Association,.for exam¬
ple, tries hard to live up to thesei
objectives.
Considering its in¬
perience,
and
the
tremendous come, which is modest indeed in
growth of instalment credit in our comparison with similar associa¬
banks have brought about great
tions in nearby sta.tes, the Mary¬
changes in the banking business. land Bankers Association's accom¬
Equally, these changes have plishments I believe are quite
brought with them many new impressive.
problems. It seems to me that
In a recent visit with the super¬
banking at the moment faces two
visory authorities in Washington
developments of immediate and
—and incidentally
this has be¬
pressing concern—the question of come a
very
pleasant
annual
management succession and the
event—the question uppermost in
present trend towards more and the
minds of the Maryland bank¬
more bank mergers.
ers
delegation was "What about
The
days
when young men this recession? Where and how
found it a privilege to work in a did it
get started and when will
bank are no more and our pri¬ it
end?"
mary problem nowadays is to find
Of course there were different
ways
and
means
of attracting opinions as to the basic cause ot
young men of executive caliber the so-called recession, but I wasi
into the banking field. I am con¬
impressed with the almost unani¬
in my early

fident
ceed

that

that

in

we

can

banking

and will

ex¬

suc¬

convincing young people

a career

in banking has much

to offer them.

opinion that many of tha
suggested remedies would lead t<>
another inflationary
cycle with
mous

all

the

dire

attendant

conse¬

quences.

Wave of Bank Mergers

The

The

the

country—is bound to have a
far-reaching effect on our finan¬
cial structure and to bring about
still further changes and develop¬
ments
in
our
procedures
and
methods of operation.

of opinion wa»
magic formula to
present ills—but as goo<§

consensus

that there is
cure our

no

we
should go about our
daily tasks using pur good com¬

bankers

mon

sense

with

determination

a

to

play our individual
licking the monster.

in

parts

Wm. J. Mericka Adds
•

v

(Special.to The Financial Chuontcle)

Ohio
Thomas
Redinger has become connected
with Wm. J. Mericka & Co.,. Inc.,
Union Commerce Building, mem¬
CLEVELAND,

B.

bers

of

the

Midwest

Ex¬

Stock

change.

Dealer-Broker

Addressing Service

business from offices at 2324 Hia¬

delivery of 300,000 kw (or more)
over a 30-year period.
The Olin- watha Boulevard. Mr. Meyers was
Ormet
power
requirements will formerly Secretary and Treasurer
come
from the nearby Kammer of First Securities Corporation.
plant.

Two

of the latter's

three

With Chace, Whiteside

225,000 kw units are owned by a

subsidiary of Ormet but will be
operated "by the American System.
two

further
area,

developments promise
activity in the

industrial

plus

increased

("Special to The Financial Chronicle)

publishers of "Security Dealers of North Amer¬
we
have a metal stencil for every firm ant
listed in this publication,
which puts ua In
a position
to offer you a more up-to-the-minute Hit
than you can obtain elsewhere.
bank

There are approximately 9,000 names
States and 900 In Canada, all arranged

by

&

is

now

residential members

of the

24

Federal

Boston

S.

St.,

E.

He
was
Shoe, Vana¬ Street.
formerly with
dium, Weyerhaeuser Timber, etc. Coffin & Burr Incorporated.

States

In the United

alphabetical

and Cities.

Addressing charge $7.00 per thousand.

with Chase Whiteside

Winslow, Inc.,

A wide

Union Carbide, U. S.

Aa

ica,"

BOSTON, Mass.—John H. Bartlett

1
to

reduction

plant owned by Ormet Corp. and
a
rolling mill owned by Olin
Mathieson
Chemical
Corp.
The
contract

before

will

benefit and profit of all its mem¬

W. R. Milford

—

Ohio

it

outstanding purpose of a stato
bankers association is to promul¬
gate ideas and activities for tha

were

previous period. Deferred income
taxes, which are fully normalized,

confident

It

Banks today
serve the pub¬

present wave of bank mer¬
gers— which appears to be the
$2.25 compared with $2.09 in the order of the day everywhere in
months

12

Maryland banking

requirements

grow

tion.

in

best.

the

which

lic

hasi

has adjusted to new patterns and
new

a

diversity of other indus¬
Joins Goodbody Staff
Bermingham
tries have also been coming into
(Special to The Financial Chronicle)
•
Edward J. Bermingham passed the area including Bohn Alumi¬
away July 13 at the age of 71 fol¬ num & Brass, Farnsworth Elec¬
BOSTON, Mass. — Stanley S.
lowing a long illness. Br. Berm- tronics, Jones & Laughlin Steel, White has been added to the staff
ingham prior to his retirement Linde Company, Republic Steel, of Goodbody & Co., 140 Federal
-was a

for

in operation
the

businesses,

stark necessity in theser

a

days of constant expansion and
growth and banking must appar¬
ently follow the trend and hopa

is

turned to the Ohio

now

business.

EL J.

this
age

other

in

as

become

With
increased
cash
flow
no
Whether or not the merger de¬
Valley equity financing has been required velopment is good for banking I
for cheap electricity. Kaiser Alu¬ recently to handle the big con¬ leave to the
experts.
But it is
minum & Chemical Corp. began struction program, and none ap¬
certainly true that the trend to¬
operating its $200 million alumi¬ pears likely until around 1960.
*From
a
talk by
Mr. Milford upon
num plant at Ravenswood, W. Va.
The stock has been selling re¬
retiring as President of the Maryland
last November
a completely
cently around 45, or at 20 times Bankers Association at Assn.'s annual
integrated operation. Another alu¬ recent earnings, indicating that it convention held in Atlantic City, N. J.
minum
plant was scheduled to is included in the select group of
begin
operation this
spring at "growth utilities."
has

These

Anderson,

Randolph & Co., Inc.

use,

were

electronic,

known

■

("Special to Tee Financial Chronicle)

methods

Volume operation, in bank¬

ing,

bringing
about changes

a

economies

new

—$2.23 being reported last year
compared with $1.42 in 1951. The

kw,
1949 figure.
It

time.

obsolete

huge 450,000 kw units, which when

steadily in the ensuing six

1960

a country
posting and

hand

other

many

in

started in

where

installed in
duce

mated 4.6 million kw and by the
of

bank

atomic

American Electric Power's share

6.4 million

>;

To one who

earnings gained only slightly dur¬
ing 1947-51, but have increased

end

bank mergers."

unit.
In addition to using
steam at 4,500 pounds per square
inch pressure and 1,150
degrees

system's generating capac¬
ity is nearly 4% of the U. S. total.

$1.5

The

Clarington,

Diamond Co. to Admit
New

exceed

were

more

wards bigness is by no means con¬
fined to banking. Business of all

billion.

gram

the

F.

should

million

and

more

Banking throughout the nation
is passing through a trying period.

it placed in operation the
"supercritical p r e s s u r e"

year

ment in the Pacific Northwest and

Formed in New York

to

$292

opment of the Ohio River Valley.
Because of lagging hydro develop¬

Herbert Perry & Co.

70

amount

in with the rapid industrial devel¬

prevail in the end.

has

.

The system remains in the forefront-of engineering progress. Last

At the end of last year it approxi¬

tries.

ning

others.,

farm- steam

coal

and advises bankers, since there is no magic cure,
about their daily tasks using "good common sense'' with
a determination to
play their individual roles in licking the
downturn. States banking's two principal areas of concern
are
"management succession and the present trend towards
sequences,

to go

Celanese, Dia¬
Cement, Food Ma¬
chinery, Foote Mineral, Ford
Motor, Mead Corp., and many

mond Portland

their produc¬ dential rates were 2.32 cents per ciency. The company is continuing
This may ultimately re¬ kwh, well below the national its researches along other lines,
new kind of foreign serv¬ average of 2.56 cents; annual resi¬ such as the use of char as
fuel,

ice,

was

under way

improve

tivity.
quire a

Maryland Bankers Association's President notes
almost unanimous opinion that
many of the suggested slump
cures
would lead to inflation and its attendant dire con¬

In addition

Y'Y.; first

„:

..

territory

area,

The popu¬
five

exceeds

area

mining and oil
eign investors, of their employees, refining important activities.
and of their profits. This is a sub¬
Manufacturing industries include
ject on which we ought to be automotive products, rail
equip¬
working more assiduously than ment, steel and metal
products,
we now are.
chemicals, textiles, glass, ceramics,
Fourthly, we must launch larger rubber, cement and furniture.
technical

Former President, Maryland Bankers Association

Retiring

expansion plans were
last year for American
Electric, controls one of the larg-, Cyanamid, Anacoda Wire &
Cable,
est electric
operating systems in Armco Steel, Babcock & Wilcox,
the country.
The interconnected Bendix Products,

formerly American Gas &

investment, million,

which

<

American Electric Power System
pany,

„

*

re¬

mean
"We want trade, not aid." The

renewal

By W. R. MILFORD*

Honorary Chairman, County Trust Company of Maryland
Cambridge, Maryland

By OWEN ELY

peatedly told us, and they

it,

Banking's Trying Period

Utility Securities

whether they are tariffs or quotas

Special N. A. S. D. list (main offices only) arranged
as they
appeared in "Security Dealers." -Cost
A. 8. D. List, $8.00 per thousand. .

Just

for addressing N

We

at

can

a

small

also

supply the list on gummed roll label*

additional charge.

:

Herbert D. Seibert & Co.,
Publishers of "Security Dealert of North

25 Pub Place

—

REctor 2-9570

—

Inc.

America"

New Verb City

-

.

The Commercial and Financial Chronicle

24

:«,•<••••..

Fixed

vt.

14

Thursday, July 17, 1958

gages
in

Free Interest Rales

in recent years of -change Response of Mortgage Lenders to
policy is evident
Monetary Change
the record. From 1952 when
The major types of lenders have

monetary

from

_

money was tight, and 1955, when
it was .easy, the annual net flow
of funds into- conventional home

mortgages, increased from $4.3
billion to $5.r billion, a rise of
about one-third. The subsequent
decline

to

billion

$5:3

1957

in

when capital, markets were again

tight, represented

a

than 9%,
other

drop of less

'

;

During these
hand
7

the

net

the

on

same years

flow'of

VA
_

was rising from
low of $1.4 billion to a peak of

mortgage funds
billion

$5 3

-three-fold

nearlv

a

Wd iben

increase

dropping again

to $2.3 billion, a decrease of

well

one-half
Somewhere between these two extremes was the

over

shifting flow

of

mortgage

FHA

Hinds.

_

differently to monetary
measures, reflecting other basic
and changing conditions, in part
peculiar to the type of financial
institution. Moreover, we find the
same types of institutions reacting
differently to similar monetary
reacted

Importance of Factors Other

•

il_

_

_

i.

1.

_

1

_

i.

Tf

I'l

with

on

pXfZSons

mv

In

Ul

P

~

^-v

w,

»-v r,

in_

-k.

;

~

*

third

~

~

~

.

in the closely
policy, in
inajketjS for corporate and ether
eeei^ities, in flows of savings to
|ittancial institutions, and in other
market
forces, have played a
fjundamenlal role in influencing
^course of -mortgage
market
developments. Moreover, Federal
policy actions in the area of hous|ng finance, seldom coordinated
witti fhpse .of-monetary authorities, have .tended on occasion to
■

•

■

-

'

area

"

"

fiscal

of

J

»

t-«

U/v

r* tf

J'n

m

TUrk

r\tT

effectiveness- of
'

must be

praising

Bank

System,

ca^fully^weighed in ap».tbo'

effectiveness

of

monetary policy.

While it is clearly hazardous to
try ^o lendprecisipn to jthe meas1

tive, and the amount of discount tary .policy actions.,

'

'

"

*.4-

'

'

~

'

41 J!

J*

A

pletely opposite manner from .life
cominsurance- companies
and
these
mercial
banks.
Both
of
uiese
groups were curtailing their VA
mortgage flows and expanding
their conventional mortgage flows,
Havings and loan associations were
also increasing their conventional
home mortgage lending in this
period, but these institutions were
expanding their VA loan activity
'

as

well.

,

developments

market

gage

,

overall 1958-mprt-

Meanwhile,

have

pn
the
upswing of the
roller
coaster path typically traced by.
FHA and
VA mortgage
i'lowsi,
,.

This

/

westors. The Tesponse

as a re-

surance

companies

of life in-

for

example

•^.r?T^ito*ehi>1f>fi1 4vas«ucSPrger'aSrtoS7da
Heserve

support

of

m0netaryPease,

^hlevel sto^ty m^housmgmrd.

*

erally

1 /\V. ^

rtniMIV. .f

rtMrt

lenders

—

.IVI/l

gaining and

Vl aI/Ii

four occasions to reduce the re-

*

discount rate and lower bank re-

_pct

requirements, and through

its open market
expanded the base of commercial
bank credit generally. There 'has
rtl /I

—iVh—.-m4-

rt

holding

-

short-term yields

jn

^.-Fed?ral forger «me lag behind changes
their prices,

/lV\

^which
l

has

'

monetary

Government

f I ttaLt

ni'C

Implication of Present Mortgage
Portfolio Composition of
-

Savings Banks

.

wboiG

of

and

vVOuld

the

beta

permit the free interplay of marnn

insurance

®ral
mortgage^^ insurance
rtnarantoo ,rTn
hp
thic
C11 rA

Fed-

and

aau

ctati

yiAmi-kAfi

mortgages
f, r- '

njc

t'nr

n

^ mortgageTare on^

C°rP°rate

ag^n

attract

tive. But should we not prepare
Iq this setting, Federally under- £0r the future, and reaffirm our
written mortgages have once agmn
,belief in free markets, by taking
become attractive investments, the acti0n now9
* . / •
m0re
so
in view of the«recent
%
:
•

...

„

^

,

,

Unless fundamental changes occur in the interest rate policy on

,

,

,

1

affected by changes i» haVe declined throughout the
monetary policy as well as by country, and in soine areas have
unpredictable Federal statutory disappeared. In Boston, the Boston
and administrative changes.
Five Cents.Savings Bank has iglarly

There are, of course, variations
in portfolio composition among
the savings bank states, let alone
the individual savines banks- Here

traditional market pracUce 4>8;9199%.
.
;
FHAtJoana to bor-,
Tim-tost pubhc financing by tte

is tofking

«» 5%%, rather than go to vRR Co. in 1952 of $15,900,000 of
VA-guaranteed Joans joint bonds. -

to

,

T«

41

_•

1

i

•

nnAvnkinn.

r

,

.

*

-

some

priced at 100% and accrued inThe issue was awarded to
the Morgan Stanley group at competitive sale July 15, on its bid of

terest.

ip of Federally underwritten loans is premiums.

to

4jrvv.n

banks preferring, to operate

Mtge.4120o Bonds

rowers at half a percentage point -company-was the sale jointly with
below the current administrative -the. New. Orleans &. Northeastern

poUcy

4

steadily increased their share of

oil

noted—in addition to their tradi- ing a greater inflow of savings gaj^an|®®;
zf
tionallonrl still significant role as than anticipated, have been .ac- seems less urgem now uuu.
and
1 Annl
5TilViHn/
lively competing tor a limited Pe««ve Fields have been reduced
local lenders,

tionds

i4

penalty

than

mar_

markPr

p

leadership, in fact, 4n the VA carried over into the long end. .of
mortgage iuwnw, as previously the maxaci, as investors receivmarket,
as
u«? market,

b°tl1 pf the wider capital market -jlrpps to about 40, still higher fhafc
.course, .unique, m its mortgage
investment opportunities available the average for most other types Practlces» 35 weil a§ m other reto life companies and the greater of
financial
institutions
The spects,
and the current market
acquire Jbigher yielding assets, and influence of the mortgage comsafety added
to
savings' bank situation here> is bardly repre"in particular, to build updepleted toitment process oq their opera- mortgage portfolios by the high sentative of other parts - of the
*i.
°
tions.
In
the
savings banking percentage of Federally under- country, nor even in other parts
mortgage
portfolios.
Thus,
all
mortgage
loans
is
of
Massachusetts, I am told.
,
matorlvtieK Af
inctii«+^r>o
industry, there is much less wrmen mongage loans is, ot
«
muui
xeas written
_*
* "
'
^
iasbtut*ons uniformity of operations, with course, comforting. It should be Nonetheless, it is clear that
liquidate

r^diUr

readfly ^nd -without

erpatpr

3 A. „|nitai
[s ™ tnwards reduce
„

£l"ei ™
operations has *At

serve

than did re- 45, somewhat lower than for all ln <M« city are now being made
Monetary policy was largely in- sponses of other types of financial savings banks, and if Boston banks at Par or on.e P°int above par.
operative
-investors were able institutions. This is a reflection are eliminated,
the
percentage fhe metropolitan Boston area is,

ifo

the road to

r eaerawy aiaea montages, uiese
Federally aided mortgages, these elimination of Federal controls on q
ot r eaerai
011
hmaiim
investments may be expected to the amount of permitted discounts JH0r£8tt ^30l6y llfOIID
continue to be particularly vulner- and the statutory increase to .
w
able to changes in monetary pblicy 4%% m the contract rate of inr 1
and" in the general financial terest on VA mortgages. Some life \
climate. And because the savings insurance ; companies,
however, •
st
banks have such a large propor- .have hot yet been attracted to the
sharply curtailed their VA mort- tion of their total mortgage port*. VA market, because of previously
Morgan Stanley &. Co. and 10
^gage activity. Conventional mort-folio in FHA and VA loans — built-up portfolios, and because; associated investment firms ofgage flows from these lenders three-fifths,
as compared
with discounts necessary to bring yields fered for public sale yesterday
declined
by
relatively
small two-fifths for life insurance mto competitive range are larger -(July 16), subject to approval by
amounts.
companies, one-third for commer- than they feel can be justified the Interstate Commerce CommisDuring the intervening 1953-55 'cial ^anks» and little more than from a public relations viewpoint, sion, a new issue of $22,000,000
period of monetary and capital °ne-fifth for sayings and loan Discounts required to bring yields Southern Raflway Co. fiTst mortmarket ease the greatest exnan- associatons — their overall mort- on FHA mortgages into competir rgage collateral trust 414 % bonds
sion in mortgage funds from all gage operations may be particu- tive range with other investments ;due Aug. 1, 1988. The tjpnds werja

^®SIe*T£!?su5r. "ar of Change in mortgage flows
•5nwr.
varled considerably among in-en-

that date■financial institutions

path is hardly

large, especially in view of un- followed a traditional pattern in J?1® .P311}
P® roaci to
]
„suaUy .attractive corporate se- „ settlng of
reFor as soon
curity yields.
enforced by emergency housing as business conditi
conditions change—as
in retrospect, I think we can legislation. As the business re- a
f will —and borrower
agree that among the most signifi- cession deepened, the Federal Re... becomes
Cant
developments
influencing serve reversed its earlier policy L ™ "diiv available and monepostwar mortgage operations of and moved vigorously, beginning t^.v nolie^ is directed aeainst
savings banks was the amending in November, 1957, to establish a Jaly P
nressures
then
the
0f state statutes to permit the credit environment conducive to
a °
yp Federallv under-i
acquisition of out-of-state Fed- business recovery. It has acted on^
°
f ® . rwillacairi

pf influence
of
monetary
mc^urcs, there can be little doubt
that the effective operation of a
flexible monetary policy has been
types of financial institutions oc-of fundamental import in mortpurred m the VA mortgage margage marketpctivities. This policy ^et. In periods of both ease and
had 4ts postwar iairth with the
stringency the timing and degree
ure

.-Joyed, unlimited liquidity

rise somewhat.'

competitive situa-'

j-v4r4-r\ n+C

How, how did the main types of
financial
institutions
react
to
monetary ^neas- monetary stringency in 1956-57?
Thus,- the
influence .of jjjis time all
investors, savings
changes ui Y&xler al mmtgage banks and
savings and loan assomdorwritingprograms, inFNMA ciations, as well as life insurance
pperauons, in policies of the Fed- companies and commercial
banks,

Imiit.as well ps to increase the

^aL Bome Loan

may

.

underwritten
mortgages,
Prior to this legislation, savings
assess the influence of one set of doubling.
banks had been reducing steadily
forces "aU other things cannot be
Another way of saying these their
relative participation in
holdroquah" Iri our dynamic econ- things is that during the 1951-53 mortgage markets. In the subsepmy Mother things" are always period of credit tightening, savings quent years, they have become

related

loans

this kind of

local ingage funds, the mutual savings vestments available in the capital of savings and loan associations, year over last.m^>„ebf1c®ufb°f
banks expanded their net VA surplus areas of the East. By 1956- m this direction are currently lags in actual mortgage now s be
mortgage investments by two- 1957, on the other hand, credit receiving serious consideration in hind commitments and bousing
f
sA.dlo
a result, the participation stringency found many savings Washington All of this may mean
"f savings banks in VA mortgage banks with mortgage portfolios at important shifts in the structure tending to be even larger 111 lwau
markets increased from less than close-to-desired levels
discount of mortgage markets and m lender than in 1958
'
'
10% in 1951 to more than 50% in regulations on Federal y under- portfolio composition, with resultU this pattern s^deed real
1953. This unusually large share written loans increasingly restnc* mg changes in responses to mone- izea tnen we win once again oe

lendeJs

%pliey,\but changes

aided
In

For the future, potential changes
tion, it is especially important
in conventional loan arrangements that
savings bankers and other.
may have an important influence
f
on mortgage markets. Loan-to- investors guard against a possible,
value ratios of 90% and extended deterioration m loan quality,
maturities are already in effect
All in all, unless residential
in New York State for savings construction and purchases lau w
institutions under certain condi- hve up to present prospects ana,
the supply of mortgages becomes,
lions. Some form of mortgage more
limited, the flow of mort¬
insurance for conventional loans
gage funds from all major types
with' flexible interest rates, prob- of financial institutions may be
ably under Federal sponsorship,
may not be far off. The efforts expected to rise appreciably this,
.

periods.

A

.

__

eve °Pmen s

ar e

portfolio situation which existed
lor savings banks in the two

in the total net flow of VA mort- favorable compared with

through periods of both credit
to stringency end ease.
monetary change, I want to stress
In contrast to the accelerated
the importance of being aware activity of savings banks in VA
that other basic forces are always mortgage markets despite credit
at work tnodifying the influence stringency, their investments m
of monetary policies in the mort- conventional home mortgages begage and housing markets. One of tween 1951 and 1953 were being
the
difficulties
of
Uving
and markedly reduced. During this
working in the real world rather same period, the total net flow of
than in the world of textbook conventional home mortgage funds
economics is that, in attempting to from : all
sources
was
nearly
coinc

..

ings banks have continued to be required to compete with yields
the largest VA mortgage investor on
other securities increasingly

Than Monetary Policy

Before

The
action of
in Massachusetts

1951, you will recall that
most savings banks had only recently acquired the right to lend
beyond
state
boundaries,, that
many of the larger
banks had
actions taken
on
separate oc- more funds available for ipy£st-(
casions. Thus, notwithstanding the ment than could be absorbed in
general tightening of credit be- local markets, and that effective
tween 1951 and 1953, and the yields on VA loans after discounts
accompanying marked reduction in many out-of-state areas were
r\»»l
xtrith
1

has since been reduced, but sav-

;

v

1957 under similar

ditions.

FerFHA and VA Mortgages

>

.

credit con- 17 states in which they are located gages, especially from FNMA's
savings or to adjacent states, while sav- portfolio, have increased considbanks
in this ings and loan associations are erably. Moreover, competition for
respect was similar to that- -else- widely dispersed throughout the mortgages ...may increase if "ithe; ,
where, except that the 1951-53 'country,
including
the ~ faster inflow of savings continues Targe, j
expansion was much smaller, and growing areas, and life insurance and the volume of new corporate^
1956-57
contraction -A was
much companies -can generally
make security
issues / declines
as : is'
greater
relative to all savings conventional loans anywhere in widely expected. Thus, contract
banks. The answer to these actions the United States.
interest
rates
on
conventional
lies in large part, I believe, in the
mortgages are likely to decline
considerably different legal and decent and Prospective Mortgage further and prices for Federally
in

a

.

:.<r

Continued from page

(

.

(220)

recognized, however, that to the

.

The carrier will use the proceeds of the sale to reimburse its
treasury for expenditures in con-

nection with matonng bondj^to

provide funds, which ™th other
company funds, will be used for
capital expenditures and for other
corporate purposes. The bonds
will be secured by an equal principal amount of Southern Railway
-fir*c+
1 irlvt\cvrtftn{t&
.first consolidated mortgage 5%
there has been a turnaround in bonds due July 1, 1994.
mortgage markets lagging cusOther than for sinking fund, the
tomarily by several months be- new bonds wijl not be redeemable
hind the shift to monetary ease, before Aug. 1, 1963. Sulking fund
nnnn

„

ii.

'.i

«x

in

•_

nfllOV

ltOrTC

■i

Tirill

kn

CC1

r>nncn

capital ^market investments going under a system of advance mort- extent that this-portfolio composi.into mortgages in the five years gag?
commitments, and others tion reflects current lending policy
ending in
iQ^n
Tbnt
+ha
Prefer.nng to purchase on a spot of the industry as a whole, it will
nZSzLuL of uJ'basis m the open jnarket.
;
more
sensitive to changes in Commitments from life insurance payments beginmngjn 1959 will
u
lformKy
behavior has -not
What explanation can be offered monetary
actions than that
of. companies and savings banks have be sufficient to retire annually
prevailed since yearly 3951 must be for the uniqueness of the savings mortgage lenders more actively risen rapidly fromlow 1957 levels. $440,000^principar^ amount. of uew
attributed mi important measure r211^ action in aggressively seek- engaged
in
conventional
loan Pension funds are becoming ac- bonds-through 1968 and .$660,000
nncff.w
!ug VA loans in the 1951-53 period markets. Savings banks continue tively interested in FHA and VA in the years l969-87.This is calcpio the reactivation nf
of credit
stringency, then reducing to be limited in their conventional loans after years of indifferences, lated to retire 77 r of the lssi^e
como

'

u

„

monetary policy.




this type of

activity by one-half mortgage lending activities to the Purchases

of

completed

mort-

prior to

maturity. The

sinking

Volume

188

Number 5760

fund

redemption!

from

101%

amount

to

-

i

p r

.

.

.

and Financial Chronicle

1

Ou

•Optional redemption prices^seale ,}
104% on. or after Aug. 1,
to the* principal amount on
and after Aug; 1, 1987.
~
, 1
,
.
During the ten-years 1948-57

By JOHN X. CHIPPENDALE, JR.

$104,585,737 for
capital im¬
and $185,610,827 for
an-d
wholly-owned
other

affiliated

and

By ARTHUR R WALLACE

Tltis Week -— Insurance Slocks

recently introduced bonds, especially the 2*%s of 1965. The sharp
decline which had taken place in tfye long-term bonds, led by the
3%s of 1<985, and the intermediate-term issues paced by the 2%s
of 1965, had a demoralizing effect? on the whofe Treasury list, save
for the shortest most liquid obligations.
The intervention of the
Treasury (and it may be repeated) whieh resulted in the pur¬
chase and retirement of a fair amount of the 2*%s of 1965, and a
modicum of the 3l/4S of 1985, has had a stabilizing influence on
quotations of government issues. This action should help the im¬
pending refunding operation of the Treasury, r/ V

$24,-

The
companies
operate approximately 8,100 miles
of road serving praetieally all of
the important commercial centers
of the south, several mid-western
carrier

$

.

THE TRAVELERS INSURANCE COMPANY OF HARTFORD

cities and

Washington, D, C. with j.
The way in which the Aug. 1 maturity, and probably the
interchange
connections * September ones also, will be handled should be made known today.
with many other carriers.
1 ^ The guesses currently being made indicate only short maturities
j The
road's operating revenues
will be used, with an option deal expected. A one-year obligation
in 1957. were $266*846,000.. For the >
along with a two or three-year issue are the ones that are getting
^

,

five

months

of. 1958. they >

most of the attention, this time.

$103346.000, compared with
$114,463,000i in. the: corresponding
period of 1.957. Income available
for fixed charges after taxes for

-

.

.

1957
for

$45,465000,

was

the first, five

The Treasury, to bring about some semblance of orderliness
in the Government market last week, announced, that a. sizeable

$15,864,006

months of

amount of the 2%s of 1965 had been

1958

BOSTOK,/

Mass.

.

-

,

:

—

with

now

York Stock

According.to advices, the Treasury went into, the open market
and bought back its own bonds in order to ease the "disturbing
effect" on the bond market of heavy, sales of the issues (2%% due
1965) by speculators.
*

~.

.

Robert A.
Leavitt,
Spooner &. Company, 585 Boyiston Street,, members of the New
,

ment, with, the balance for Treasury trust accounts.. The reported
figures showed that $456 million of the 2"%% bonds were bought
back for retirement and $133.5 million were bought fbr the account
of Government investment funds. In addition,, it was reported that
$4.8 million of the 3V4% due 1985 had been purchased by the
Treasury in the open market.
' ..;_•£>>.*;*•.
^ ^
'
-

Spooner

•(Spectel to Tes Financial Chronicle>

Leyton-is

bought, in the open market.

The bulk of these purchases were for their own account for retire¬

and $18,416,000- for the. similar period of 1957.

With Xeavitt*

What the Treasury Did

~

Exchange.

"Shooting; Fish in

V

REPORT* OP CONDITION- OF

a.

Barrel"

It has been known; in financial cireles for some time that the
Government market was loaded;, with, "free riders," "joy riders,"
,

Underwriters Trust

and speculators,

of 50

Broadway, New York 4-. N. Y., at the

close

of

business

June

on

lished in. accordance with

pub¬

1958,

23,

call made

a

by

the

Superintendent- of Banks pursuant to
provisions of the Banking Law of the
State of New York.
the

...

\

balances

Cash,

witii

-

including

"'

other

items in

;

much

•>

-.

and
and

!_

of

notes,

and

top-heavy
so that it didn't take more than some open-mouth operations and
a few trial balloons, out of the nation's capital, about the possibili¬
ties of a change in monetary policy to bring about heavy liquida¬
tion in the Government bond market. As is always the easoy when
an element of uncertainty is thrown into the picture, there are no

1,918,618.79

ing 91,473.72 overdrafts >__
Banking premises
owned,
furniture

•

$44,013,800.71

—.

deposits

of

indi-

partnerships,

corporations

:

partnerships, and

"

The Treasury, by making
purchases of its own securities and. retiring a part of them,, does
not add to the money supply, in fact retirement of debt ex¬
tinguishes deposits which is a deflationary, process.
On the other hand, the Federal Reserve banks, by not stepping
into the market and making purchases of bonds, has been able to
keep sacred its "bills only" policy. Purchases of Government bonds
by the Central banks would have given much needed support to

.

.

921,105,330.44

Time deposits of individuals.

*'

y

.

corpora-

tions

5,182,780.57

Deposits

of

United

States

-

"

Government

798,832.80

Deposits of States and politi•

cal

-

subdivisions...

■

' *

■

the

11,005,29.2,17

Deposits of banks and

-

trust

"

j
Other deposits < certified and
companies
officers'

Government market

created

while at the same time it would

have

deposits, and added to the money supply, which is the

procedure when the economy is on the defensive, as it is
present.
^
An Attractive Issue

usual

1,150,297.47

at

-

checks, etc.)

was very

stepped in and- bought its own bonds.

;./■. "...'V-.

•

and

proportions it

buyers and everyone wants to sell. This brought about disorgan¬
ized conditions in the Government bond market until the Treasury

184,039.91

LIABILITIES

....

victuals,

-

fix¬

and

113,502.19

ASSETS

Demand

;

" :

:*

;

■

-

10,375,828.02

:

assets

.TOTAL

-•

-

*

1,507.203.99

.

*

TOTAL DEPOSITS
Other

;

$40,809,743,10

liabilities-

TOTAL LIABILITIES
CAPITAL

Even

159,209.58

_____

Undivided

ACCOUNTS

$l;000,000.00

...

TOTAL. CAPITAL

1,584,908.03

AC-.

COUNTS

93,584,908.03

TOTAL LIABILITIES AND
CAPITAL ACCOUNTS

__

'

with

.

Assets

total par

value of 91,000,000.00

pledged

or

.

assigned to

secure
liabilities and for
other purposes
(a> Loans as shown above
.

•

v

are

after

serves

(b;

$12,352,090.09

re-

of

109,233.75

Securities

above
-

deduction of

are-

as

after

of reserves of_

shown

deduction
:

7

Professional Inv. Serv.

Inv. Brokers of N. J.
N.

Treasurer, and
Dabler, Secretary.
nings,

The

Robert G.

firm

also

has

an

office at

4900 Lister Avenue, Kansas City,
Missouri.

,

With Townsend, Dabney
(Special to The Financial Chronicle)

knowledge and belief.

my

KENNETH

Corrects—Attest:
i
-

W.

LANDF ARE

I

CHRISTIAN W. KORELL)
SUMNER

FORD

[Directors

JOSEPH. B. V. TAMNEY j




;;

In

split 20-fbr-l, with the
at $5.

were

par

valuq

now

investments, bonds conr
59%
assets* stocks 4%, mortgages 27 %.
and. real, estate 1%; Its, net inter-

BOSTON, Mass.—Durno Cham¬
bers, Jr., is now with Townsend, vestment business from offices in
Dabney & Tyson,. 30 State Street, the State Tower Building under
members

of

the

New

York

Boston Stock Exchanges.

and

the

firm

Mahon Co.

name

of

Frank

Mc¬

Its* realty -is.carried, at

A break-down of $he'

68% of cost.

companys. port£olioA inti» principal!

The original charter restricted categories follows:
the wrifingsv to accident insurance* Cash: andi,Goyt Securities
but1 in.1865 life was added, general. Real estates-

230%
1,4 i

liability ia 1889,. health in 1899, Mtgs. and collateral loans^_35.Q
and other lines came along sooa
Policy loans
after the turn, of the century.. It Other bonds.
is the leader ia the Travelers fleet Stocks

^.

3.6,

of companies, as follows:

1199552634-—

The company made' soinat new
highs, in, 1957: premium, income
exceeded $991 millions^ new Hfti
Charter Oak Fire Insurance. Gov
insurance^ exceeded $666 millions;,
It is one of our leading multi- new group, coverage-exceeded. $$
pie-line companies, with about billions; life insurance ia force
56,006 agents. Life coverage ao passed $2L7 bUlions*incO|ne.frQja
counts for about 27% of consoli- premiums, . and -investments
me¬
diated premium volume; accident ceeded $libillibn,.
and health 26%; automobile 25%;
A new family contract was inworkmen's compensation 10%; troduced iix 1957,, providing' Itfte
and fire-marine, general liability- insurance protection fbr aiLmemr
property damage 10 %... While bers, of the family,. and.was weR

The Travelers Insurance Co.
The Travelers Indemnity Co.

.

w

_

..

„,

,

automobile lines represent a sub¬
stantial total-when compared with

received.

)

.

Travelers, writes alargfi amount

.

is of; fire and* casualty, coverage, fte
problems, in, this, connectiqn have
so that its life coverage is a heavy
been the same as those of the
offset, and Travelers is thus better ipdushw;. meagre rates4 .largje. vol¬
situated than many casualty units ume of losses. But, as. indicated
other

casualty

small

enough in Travelers'

companies,

it

total

,

qbove* Travelers has the^benfifit
during this pe¬ pf the offsetting life Jines7whiCb
riod of severe underwriting losses make a big, difference in its re*
in the fire and casualty fields.
suits.
The general tendency, for*
The
company
is licensed fire-casualty companies^reithei*

that have

life business to* bol-<

no

ii._

ster- their results

j—-

'

-

take

in non-dividend form.

The

mor-

tality rate is favorable; lapses low;
policyholder low.

net cost to

Travelers is
of

a very large writer
insurance, and in 1957

group

wrote
ness

of

than
this

a

total of

1957

written

busi¬

amount

was

of $660,-

group insur¬
with 626,earlier.
Total premium income in the
past seven years (Life Depart¬
ment) was:
This

compared

a year

-

-

—

u cen-

Witk Fordon, Aldinger
DETROIT,. Mich.—Frederick F.
Fordon
is
now
with* Fordon*,

Aldinger & Co., Penobscot Builds
ing, members of the* New* Ywk
and Detroit Stock Exchanges:

Two With Goodbody.

-

(Special tO'THE Financiai^Chboniclb);

$392,765,000
447,571,000
516,793,000
542,375,000
582,371,000

DETROIT,
Howen.

and

Mich.

Paul

—

Robert F:

.

EL
Schifter*

the staff of Goodbody
Co., Penobscot Building. Mr.

have^ joined?
&

641,010,000

1957,

half*

(Special* to The Financial Chbonjolb)*

life insurance

excluding

800000,

ance.

800,000

life

new,

^

dom of such a set-up

the

the

establish;

puts Travelers fhr Jin

tury or more ago.

1956.

new

in

group

■.

tyont m the major-portion' of me
industry. More thoroughly inte¬
grated business is the order of the
day; but Travelers saw the wist—

$2,316,000,000, more
new writings in

over

double

line in

In

new

-

.

or

over,

companies

All of its life business is

Schiffer

737,760,000

H.

was

Walker &

previously witte Q>
Cot in. Providence*

R. I.

Total life insurance in force fol¬

'

'

'

)

lows:

1951.

1
—

1955

1956—-

Travelers

has

Two With. Andrew

$11,387000
12,638,000
14,126,000
15,375,000
17,003,000
18,718,000
21,701,000

enjoyed

an

R«d

(Spejiafeto THBiFmANCiAt.GHHONi^Lf:^

ex-

change.

•

r

NEW YORK
L

26 BISHOPSGATE, LONDON,

.

DETROIT; MiclL—BichatdrW.
Fairgreive and: Peter, W. Woaena
are now affiliated with Andrew
Reid & Company,, Ford Building,
members of the Detroit Stock Ex-*

RG2

r

,

Bulletin Available

London Branches:

13 ST. JAMES'S SQUARE, S.W.1

Bankers to the Government in : ADEN, KBNYA,

Mahon is

its

$106^industry.

par

.54 PARLIAMENT STREET, S.W.1

Frank McMahon Co.
SYRACUSE, -N. Y.—Frank Mc¬
now conducting his in¬

'

^

since

LEAWOOD, Kans.—Professional
J.— Investment
Services,
Inc.,
has NATIONAL OVERSEAS AND
Inc., has Investment
been formed with offices at 60 been formed with offices at 9318 GRINDLAYS BANK LIMITED
Park Place to engage in a securi¬ State Line to engage in a securi¬
Almalgamating National Bank of India Ltd,
and Grindlays Bank Ltd,
ties business. Officers are August ties business. Lyle E. Dutoit is a
k
Head Qffic«
Frittelli, President; Oscar H. Hen- principal.
NEWARK,

Brokers of New Jersey.,

103,097.22

L
Kenneth. W. Landfare, Secretary, of
the above-named, institution,
hereby .certify
that the above statement is true to the best
of

has

surplus funds of some $71,845,000. est earned is
approximately; 3.81%,
In 1955 at„ the time of the latest
which is about average?- for the
25%, stock dividend the old

1957

,

It

$10,000,000,. with, at the stituW about

195T year-end, s p e c i a t surplus
funds of $7,395,000 and unassigned

1952

....

of maturities still goes on
among certain bank investors, with, some of these institutions now
taking losses in long-term, issues in order to improve the over¬
fall portfolio picture.
'

$44,613,800.71

MEMORANDA

r

•

The trend towards, the-shortening

"

-

tThis bank's capital consists of common
stock

to-absorb the 2%.% bonds due in

1965, because of the speculative floating supply which has to be
digested, this bond is still considered, an attractive issue for investors. that are interested in a good yield and not too long a
maturity.

1,000,000.00

;

profits

though it will take a longer time than was expected by

certain money market specialists

941,028,952.08

•

Capital.!
Surplus fund

dividends.

grown to

Canada.

Stabilizing the Market

ment market had reached such

de-

bentures

tures

was

However, the pyramiding which had gone on in the Govern¬

\ -

2,205,458.20-

Loans and discounts < includ-.

.none;

than

stock,

throughout the United States and*

10,007,395.17
States

Cither

even

v

;

•

.

guaranteed

political subdivisions
.

in a barrel and could, he done with
needed for other more speculative
operations in the equity market.
7!
'
>

money

Government

direct

■

Other bonds,

less

ventures,

7,748,418.43

States

obligations,
Obligations

f

.

process

of collection

.

United

It was like shooting fish

w

....

owners

.

,

balances,

reserve

cash

and

'

V-

banks and trust companies,

...

.

^

-ASSETS

-

.

with specific issues being the bellwethers of the
of Treasury issues. The 312 s of 1990; the-3^$
of 1985 and the 2%s of 1965, were very heavy with the quick
profit operators, many of whom; had, and were hoping again, to
make a fast dollar by playing the margin for all it was worth.
There was some precedent for such a hope, since those- who had
taken advantage of the earlier offerings by the Treasury, with, the
advent of the easy money policy which starter last November,
had made sizeable profits from these purchases.
;

."shoestring"

Company

capital $6,556,006,000. By the end of 1957
being $200,000. By 1892, this had it> had grown to $2V702,0G$>QQ6, a
increased to
$1,000,000 through three and one-third fold, increase,

.

were

^

This company,, chartered; under panding trend in. its total of, insurConnecticut laws in. 1863",
began, ance- in fbrce»
la 1945, it, was.
business in 1864, its initial
_

-

traffic

first

I

The Government? market, with the aid? ©f the Treasury* has
been able to eliminate some of the speculative positions in. the

Southern invested

provements
equipment
subsidiaries spent? a tqtyl of
652,436 fbr similar purposes.

Bank andInsurance

rReporterpon Governments

1963

and;

25

...

-

from

roadway

(221)

c e s rrange

the- principal

-

Commercial

The

.

UGANDA, ZANZIBAR A SOMAULAND P&OTECTORA71

Branches In:
INDIA, PAKISTAN, CEYLON, BURMA, KENYA,
TANGANYIKA. ZANZIBAR. UGANDA*

ADEN, SOMAULAND PROTECTORATE
HORTHERN AND SOUTHERN RHODESIA*

Laird, Bissell & Eiidt
MMUkem New, York.

StoeE EzdlRBfB.

Members American Stock

Ixekanft

NEW TOKRS,R H
Telephone: BArdax MMD
Belt Teletype—NT 1-1248-49
(L. A. Glbba, Manager Tradifts Depfci)

120 BROADWAY,.

Sn*riaHat<t

in

Bank Stofla

The Commercial and Financial Chronicle

26

.

.

.

Thursday,. July 17,

1958

(222)

Continued front, page 3
surlng that the factors of production continue to give their services
to the extent that the needs of a
these

and

it'

distribute

and

growing economy require.

Ex Ante and Ex Post

in-

time

the

came

if

way of saying that intended in- unemployment
The . minimum
Vestment does not fully take up that we should achieve-is a sub-

r^ennaMv rnrrppt

t«

the volume of intended saving. As stantial improvement on the not

Partial Disequilibria

potentially even in a simplified presentation
available to buy back the total of a complicated subject, we will,
national output. Hence, there is jn the following text, from time
always enough purchasing power, to time, use the expressipns "inr
Durchasing

paid out and their current ex- For on a moderation-ot the flue- •
penditure on output for current tuations of total investment hinges consumption; which is another the avoidance of depressions and

power

of course, even with global a result, a gap has . developed, altogether perfect postwar record
equilibrium in this sense, diverg- and persists, between the demand of fiscal policy m that respect,
?nt. cost^?nd pricejorm^ion for ^°^Put^for current consump- Sometimes|fspendmg was stepp^

spent,
at r-

put

*

-

'

'

"

x-

*

^

■

"

composition
for the

...v.

jtunj

*uus>

ttuuwiuw,

~

all that is necessary

machine gets
®

in

deeper
1

a
"

.

"saving" al- or

sense,
'

...

...

.

1

.

onf)

_

Some Explanations

This description gives the essehtial features of the economic

in its relation to the mar- saving" or in "real investment."
have
although it is a simplified
Time fnr pvamnlp an excess of may
find hence not fully accurate or intended having over intended in- total
complete account. Thus; the costs
of the total national output inelude the costs of imports, paywent for which does not go into
the incomes of domestic consum-

m

^cumulation

production for export that
not
compete
for
buying

does

whole-

retailers

nf

This

manufacturers

ar1d

supplemented

being

are

comes

grain

goods accumulate on

make
«hPiWc

th<a

But, conversely, domestic in-

ers.

inThis

of stocks is of course
the

in

jnvosfment

terminology of

*
, .
We know the general character
and general cause of the decline
that has occurred: for some time
past, perhaps as far back as the
spring of 1957, spending on current consumption plus spending
on investment have fallen short

thus become disjointed there

'2?

h

rolling adjustment.
It is of
comparatively short duration and
mlld *mPact on total income and
employment. It is not the prob*em that we are faced with in a

Since to maintain or increase that
volume of production total spending must at least equal the total
of those incomes which are the
costs of production, the economy
has been exposed to a downward
spiral of pressure. Involuntary or
forced investment (accumulation
of inventories) could not but for
a short- period fill the gap. Of

ecollom|cs and corresponds to that
in the domestic market. exeess 0f savirig
It thus makes dePression»
Also, the incomes of those who total investment' equal to total
General Disequilibrium
participate in the process of pro- savw
^is type of invest^
duction do not fully remain to ment is unintended and is forced
Today we are concerned with
them as potential buying power— upon those who accumulate the problems
of general disequilithey are in part taken away by stocks by the deficiency of dc- brium. It should be clear from
taxes; but these taxes are either man(i' ^nd it has therefore dire the outset that saving is not to be
in payment for services (which
consequences* new orders will be made
the whipping boy, and course, adding to inventories is at
form part of the national output
withheld, output will be curtailed, spending is not to be idolized, times an entirely voluntary inthat the citizens buy by paying
i
i
^i : .
: ThAci* r^hAhnrnpna shnhlrl hp emii vestment! for examnle. when nfw
taxes) or become the in com
other
individuals
(transfer
comes) for whom they do co
tute potential buying power.
^ance for such investment^ This sirable economic growth. If there increase their capacity, in rcla-

their

out

thus

cancel
upon the

bearing

in

process

thpt we aim to clarify.

bid

V/n

l

re-

and

exnenditure

would

imnose

at

communitv

Saving aild Investment

would

and would thus

mdees

"real"'

d

therebv

tmt

^

.

JSSg ^^

The effects of these gaps in our

description

needed

the

large
.

,

the

unon

.

to be a value judgment attached to savinS and spending the
personal inclination of most of us
would be to deprecate excesses of

quire their own and proper timing. But we can no doubt improve
the phasing of public investment
by better planning and preparedness. Every public servant concerned with this subject should
be made acutely aware of the
crucial need for an adequate management of total investment in

«f tow^.currenOy created^ the economy,

by the total volume of the production of goods and services.

Jpower

.

^

' Closmg the Gap
As stated above, "intended in¬
vestment must at least equal
intended saving to prevent contraction of the economy." And in-.

tended investment must somewhat
exceejl saving if reduced activity

is to be lifted towards full employment levels. This, then, should
be the essence of any policy to
assist the economy irv resuming a
favorable rate of growth,
The present excess, of intended
..oniM.,

be" corrected^by ^educing saving.

tion to total business, for quick or by increasing investment, or
delivery; or if manufacturers and both. We have already stated our
trade are particularly optimistic preference for the latter, but
about the business outlook, expect should not rule out the former as,

either as immoral and unimag- shortages, priceiinqreases, and so v perhaps,
nrlnln unfhin vaaenha^lo Inrfll
m\n

a more

...

_

_

j_

.

defense and other needs that reThe Factors in Our Imbalance

be a sli^ht set-back even in
output and employment, as
outPutls being revamped towards
a new balance among individual
Pr°ducts. This kind of dip has

demand

disnosal

current

fnr

outnut

of

markets

the

from

withdraw

will

vnetmervt

sagging economy.

1

....

.....

process

ket,

a

rnir

m#j'inc

n

of production as among individual
products. If there are many lines
of output where demand and costs

bring about that equality
either by imposing "unintended"
or "involuntary" changes in "real
meiits to

insufficiency ol

investment in relation
Naturally, government expendiproductivity (outputhoi- unit to intended nrp«pnf that is at Ami j_ure cannot be exclusively oriper
saving t.rniim#»« the
InKm.
rnni nf
.

.

i.

v.L

quicklyf jeffective
_ c

There

is, however, another gap
our.presentation that needs to
we can fully tin-

in

he filled before

the issues.

derstand

It

related

is

development

fact

further

production is output lor
consumption that seeks

invpsjfmp„f Apn

all

not

that

'

current
buying

,

we

that

in

(which

production

available

librium

in

the

^ jg ,

for

marketi

is the condition that
been paid
out ; to
produce that output be
actually spent to
buy it back.
incomes that have

the

They must be
there

spent, otherwise

so

trouble

is

ahead.

they have to be

do

spent by the

so

individuals

came

But

who

have

pro-

duced the consumable output? The

is, of

answer

course, na.

.piese in-

well be spent by that

comes may

pait of the population-that us engaged 1m producing output not yet

Rnmer me'«01VurLnf

S 4a -haiSESS
n«rt

W

ancj

them

amount
.

and

are

power

is closed* total

Condition

the

process

j

to

make

of nroduction rontinne

f.ji filled

we

necessarv

in tbi«

it

intended

gay

sen^o

as

that

investment

mugt at leagt

wealth

real

or

mental condition for general equilibrium is

Budget surpluses—meaning net

stream —or re-,
on consumer credit balor 011 other outstanding

people engaged

or

output for

tion?

cost

incomes

of

out

of

those

of

nroduein^

ths-t

psit

of

ls not surprising

The impetuous comes of the same period: ex-

izes, and is a prerequisite of, growth of output after the war, penditure of savings previously
stable growth of the economy. If spurred by seemingly insatiable accumulated, going into debt to
intended investment exceeds in- consumer demand made for ex- spend, incurrence of budget def-

aggerated expectations on the part icits.
of pioducets. The Gioss National
Accordingly,

if we were to at-

more so

consump-

investment

and services for current consump- comprises all expenditures that
tion for some time to come. This do not originate in domestic in-

thBt ch^rscterizes, &nd

outnut
output,

roughly represent-

power,

the

comes

current

ex-

Ordinarily, this amount of

buying
ind

consumable
consumable

on

investment that equals intended

the production of output for investment.
This
the condition

are

on

duction did not create domestic

requirements for output of goods currently earned income and thus

itl

credit balances

such

of goods and services whose pro-

that

the

the

purchasing
nenditure
penditure

cost value of intended

expansion to full employment. If
this condition persists when full
to other debts employment is virtually reached,

budget deficits and
additions to outstanding consumer

production for investment acquire
for

a

indicate

does

Product and personal consuipption expenditures during the first
10 postwar years trended upwards
we have inflation or, if prices are by loughly 4% per year, in ieal
not permitted to rise, physical
In the period 1953 to 1957
shortages.at high levels of con- that trend rate averaged only 3%
sumption and demand. If invest- Per annum. Yet, expenditure on
ment does not voluntarily take up new Plaat and equipment in the
the volume of intended saving, same period continued at an anthe economy shrinks and more nuai average of 5/0.
and more labor and other re- q<iie distribution over time of
sources become unemployed, the

Conversely,
in

income. Negative investment (or
dis-investment) is, of course, the
opposite of positive investment
and, as. a reduction in the stock
of real capital, comprises all releases into the domestic market

incomes in the same period: releases from stocks previously acit cumulated, imports, etc. Negative
vestment.
'
went beyond the expansion of ca- saving (or dis-saving) represents
As stated before, the funda- pacity needed to take care of the the excess of consumption over

be more stable than rates of 111- however,

are tantamount to elements tended saving, an economy with
^ °t! net saving by the community, idle resources is on its way toward

eanitil

power

of

withdrawals by the government saving. This condition character-

'
do

and

economv

ances

ual lines of production. Others
might have been spread more
evenly over a longer period—but
were bunched together in a comparatively short period of time,
with consequently more, drastic

Rates impact upon employment of their
saving cessation when completed. All exchange from year to year; but pansion in plant and equipment
rates of intended saving tend to from 1955 to 1957 taken together,

investment

e ual intended saving to prevent contraction of the

an^ddition tnM debts

__

supply may have been based on outright rently

investment is undertaken.

tional output is bought back and
tlie

to

the

on

in-

in like

if they are so spent

demand

and

employ,

na-

spent

create

thus

buying

to

with their livelihood, the annual misjudgment of demand prospects

tinued increases in productivity
and> llence> *n Per capita income
and/or leisure. Private enterprise
and government, gauging such incl'eased needs of the future, normally see to it that such desirable

output

Lei od«f from the income

™

How

comes

sav-

sbortc

national

the

a]f

investment

g

Equilibrium

fhe SnT 2,',^! payments

Of

defined
of

no^

back

earned incomes — savings
in the narrower sense, repayment
increment of the working popu- for the near as well as the more of debts, accumulation of budget
^a^on, and to provide for con- distant future in specific individ- surpluses out of taxes on current

both

for

Condition

demand

buying

national output produced for current disposal

«w-

rpfWrnd

amount of these

jngg

our

nw

•

Fundamental
General

equi-

investment

poqt marmitndps

r£jie

buying power.

The essential condition of

.

.

"in-

nitimiteiv realiyeri

.

call investment) are now

may

•

,

mean

thev

invpstmpnt

■8

power in the market now, while
at the same time the incomes that
accrue

FX

in

refer

#

it accrues; and

income as

the

to

Vrnnomiste

should not, spend all

a-

•'

of their

on saving the causes of the continued but of" wealth "or"reai"capital, com-1
and more intelligently calculated sluggish increase in inventories in prises all output that does not add
10,?erve the aims of fi°od Public 1957'
any supply of goods and services,
policy.
The great pressure towards a to the stream that currently moves
First we should note that a cer- reduction
of total investment into ultimate consumption. And
^ain measure of net investment stemmed from the record addi- "saving," which we defined as the
and, hence, of net saving—5, 10, tion to plant facilities and equip- excess of currently earned income
of the national income — is ment from 1955 to 1957. Some of over consumption, comprises all
necessary to expand production these additions to plant facilities sorts of "non-spending" of cur¬

in'thaUtconstitutS'' superior to restraints

conseauences

hiflatten

to the fact that people do not as

rthe

whole nation's income that is not

or

tantamount to elements of
negative saving of the community,
In

the aggregate all of the pogi.
tive and negative saving items

added

together

algebraically

wQldd normally approximate the
incomes of th°se participating in

tempt
correct the existing imkaiance between intended saving
and intended investment by meas-

the saving side, any induced reduction in personal saving,

ures 0n

incurrence of debts, incurrence
of budget deficits
(by cutting
taxes or increasing spending)

wcmld help towards that goal, unj€SS the particular measure we

chose were itself to evoke off-

expansion in plant facilities and setting reactions.
Conversely, if
the moie resistsnce there other investiueiit will rernsin 3 we were to concentrate on mess—
requisite of, stable growth of the is to price and wage reductions problem of the private enterprise ures on the investment side, inis

is

3

pre—

inn thus is the pxppss of currently
it, iiius is me excess 01 cunentiy

^cong°°ds and services pro- (°r possibly insistence^ on para- economy. For many years past duced increases in industrial and
duc
current consumption doxical price and wage increases), economists and businessmen have residential construction, in the actlien clear the markets at

earned

covering costs

currently spent, but is saved. Sav-

income

over

consumption,




,

prices

in the

sense

of

rea-

The

itself

American

at

the

economy

present

time

finds
in

a

advocated

tion

of

a

the

reasonable stabiliza-

total

volume

and

cumulation of stocks, in exports,
in public works would all be steps

Number 5760

188

Voiume

.

.

.

The Commercial and Financial Chronicle

(223)

in

the right direction.
Both ac- penditure and reduced receipts of earns is, to say the least, not very have been absorbed at all and
tions, those on the "saving" as well • the insurance trust accounts, in- provident.
The comparison is gone to waste. And not only does
as those on the "investment", side, / eluding the needed
extensions of more likely to fit the national ac¬ public borrowing in such circum¬
hy- closing the mentioned i'gap," unemployment compensation; and counts of national income analysis stances not
imply any Sacrifice
will
serve
to lift - the economy from expanded
expenditures on -—though even here the Similar- for the population at large — it
to higher levels of output arid emt defense and under the emergency ities do not go very far.
Budget even means positive benefits, of
ployment, and thereby to raise the housing and highway construction balance,
budget
surplus,
and the dual nature that was men¬
nation's income.
But
additional acts.
Such sums as these would budget
deficit have long been tioned above. It is this particular
.investment alone will not only do represent substantial infusions of recognized as tools of deliberate case that is germane to discussions
this much but will also create imr buying power. They are, however, economic policy for the exercise of the present recession.

provements in, the nation's capital at least in part offset by a cornand future earning capacity by tinued excess of intended' saving
■enlarging and. improving facilities .over intended investment. : Oil
fer
production, for distribution v consumer credit alone the excess
and transport, for housing, health, of repayments (saving) over last
'recreation and education.-',.:.*'year's;excess'.of new indebtedness

v (dis-saYing)^ constitutes a with.2f,?'iylng p?Yuer' com: our analysis that, given
;?
.'
y pared wrtft last year, at the annual portion of Spending to
before, the present; rate of $4 billion. On the other
fa,

rrvimr
Cry'"e

'

rtina^

....

..

As indicated
shortfall in
investment

To Sum Up
To sum up:

infusion

any pro-

extensions of unemployment com¬

total in- pensation; from expanded
nation's

diture

determined govern- employment and income
up to full
large extent due to over-invest- ment program has been started, ^utilization of aH resources in com¬
ment in new plant and equipment the
replationship
between
in- plementaiy combination is at all

j

recent

come

is

to

a*

hand, once

l*1

adjust

fully

auum

the

level

was

of

the

iiguirils,u«u,

expen¬
defense and under the

housing and
construction acts; and
from the decline in tax receipts.
emergency

highway

tipies determined by the size of

con-

aim smut, nuui

On

Additional

net

,

power

At

investment

in

the

time, therefore,

any

to- assure traction to expansion. On balance,, size of net
the then current level of income-it would seem that a substantial^ undertakeh

size
•

uds

-

a

-

ccunvmjr

Much of the needed

of

buying power will
public enterprise keep the eedtt- automatically issue from the rising
omy on an even trend of growth. deficit of the insurance trust ac¬
We have seen in earlier parts of counts, increased by the needed

.

.

"

of the second function mentioned
above—the preservation of society'S welfare by creating the con¬
ditions that will make private and

needed

investment

economy,
a

certain

must

be

is,

infusion
.

however,

of
buying
needed and

should in the first place be pro¬
vided by a massive and immediate

27

termination and enlist the enthasiasm of those Who realtor flit* ex¬

igencies and the opportunities of
the moment. Very little irt addi¬
tion to such a progranf may be
required if
we
move?
ahead

quickly.

r

Beyond that

we

should in gen¬

eral

contemplate the possibility
a future in which** with' rising
productivity and expansion of
output and income, buying for
persona? consumption? and invest¬
ment may not keep pace. And we
should* prepare dfor this possibility
by a program- to stimulate spend¬
ing, not for immediate consump¬
tion, but for" less ephemeral pur¬
poses. We should,, id brief, take a
long view of the short rum by
combining the accepted shor,t-run
goal of "the maintenance of buying
power with a longrterm aim of
equal or even greater importaifife:
of

resource

short

conservation.

laissez-faire

or

For

the

policy,

by
interverrtiori,

economic

run,

by

(or faibng this the expansion of construction activi¬ must look after the maintenance
and employment. This is.a reason?!;Snet infusioii$o£
buying^PPW^^TPfopbrtibh of spending to income ties under useful community fa¬ of buying power, such as is the
able assumption since the infla- needed now to lift back quickly, must
be raised) if the economy cilities programs.
subject of present discussions of
tion that we did have in those; and thereafter to maintain, na.js to be adequately employed If
We must also keep in mind that, anti-recession measures; for the
years was on a
modestjeale and tional output on a trendline of that niuch investment is not forth- if our programs of foreign aid and long run, economic policy must
was
not demand infldwdn
(that rsubstantial growth.
v coming
automatically
in
the foreign lending must be main¬ be concerned with the conserva¬
would indicate relative total overr r ?
Any injection of buying power • course.of the day-to-day decisions tained
and, if posible, expanded tion and management of resources.
.investment).
Now, if there was-into the income stream, so long and business operations of private under
foreign policy points of And to take that long view of the
nothing wrong with the total size ;as there is unemployment of com- and public enterprise, and if in
view, this will also be in the in¬ short run means to combine the /
of investment, while we had overplementary
resources,
will
of the case of under-investment our terest of an effective
policy for two purposes —maintenance* of *
investment in industrial plant and -course increase income
by more built-in stabilizers do not suf- economic
conservation,
recovery in the United buying power; and
equipment, it follows that there than its own amount.
The re- ficiently raise the proportion of
States.
Foreign aid and foreign of resources. As a part of this
was
not
enough investment in cipients of the initial injection spending to earned income, then
effort the policy of not permitting
lending, either directly or indi¬
other projects.
What are such will spend part of it and to this the government must deliberately
rectly, mean exports —and in¬ deflation to croke Off or seriously '
"other projects?" They are either-extent will create income else- fill the
gap by doing either the one creases in exports are equivalent retard economic and sociaf prog¬
investment for defense or investwhere, and that income's expen- or the other, or both.
to increases in investment, which ress must have its counterpart,
ment for housing and for civilian. diture too will create additional
Now
of entire
it mnct ho »n
is precisely what is needed to cor¬ during prosperity, in a ^policy of
public use -Investment for de- income, and so on and on —in
that
iril rect the condition of under-in- avoiding inflation. F*or inflation
fense and for housing must more 'the fashion so well described by
vestment
nor
nnhlir snenrhW tn vestment with which we are faced. erodes the very substance of So¬
prominently
be
determined
byJ.MKeynes and his disciples.
A maintenance of exports Wottld cial justice and destroys the basis
needs other than the need for as- it is because of these dynamic readditionalitv
that
is
needed
tw also make it easier for the United for systematic and foreseeable be¬
suring; steady and
substantial lationships that a relatively mod- that function if such action hod States to maintain
imports. And havior of the economy and hence
growth of the economy.
Hence, est injection of additional buying {o be
of a bal- the maintenance of U. S. imports, the effectiveness of economic pol¬
we may say
that, in a
sense^ it' power may produce a relatively anced budget. Rather it must be plus foreign aid and foreign lend¬ icy. In order that the mainten¬
was
over-expansion in unneeded large total mepme effect.
financed through a budget deficit
ing, by supplying foreign nations ance of purchasing power also
industrial capacity to the neglect
,
*
xmancea tnrougn a ouaget aencit. with buying power, strengthen in¬ serve the Conservation-of human
If, for example, taxes were raised
The Role of Monetary and
of investment for civilian public
to pay for the additional invest- ternational liquidity—the capacity and natural resources and do not
Fiscal Policies
use—of investment for education,
increase the disposition towards
ment, the gap would remain un- of countries to purchase in foreign^
In order to carry out effective
health, welfare, for which there
markets in relation to their desire inflation, it must concentrate on
affected.
is a crying need —that accounts anti-recession measures it is, of
Such strengthening of investment for such conservation
It must be clearly understood to do so.
for our present set-back.
course, necessary that monetary
,,
\ "1USL
v
v. u
international liquidity would les¬ and for such services as will in¬
we must
nolirv and fiscal nolicv he nronthat, if we are for saving,
crease social productivity nnd will
sen the ill effects that the U. S.
It is for this reason, too, that
aiso be for going into debt. For recession might have upon the further broaden the general wel¬
for
such investment for
Phbho
saving and going into debt are economies of other
An anti-recession-policy
countries, and fare.
consumption we should envision
Quicklv back on
the two sides of the same coin- In would serve to prevent the re- that emphasizes public investment
a
key role in overcoming the
growth
So
long
as
our market economy much of the introduction of restrictive trade for
community
facilities
for
present recession and in giving
•

.

t

derstrod

neitherDublic

undeTtaken Sut

.

T

.

,

|®^
^

£C

* °£c

I trLdl^e ^f

.?tjbstaLiai
th
is undir-investment

EhM «£

bl

accepted and aided by ample loan
finance

at

an

irrestible

interest, all

over

erai,

and

state

would

go

rate

of

-t'ates and r™ r'tios' should £ba" the
be kept at

*

should

„lu,

®du'pm^

savers But, if the saver
does. not lnv^ hlmself- s?vln,g

low or moderate levels.
undue

the country Fedlocal authorities

all out in putting into

investing is done by people other

inter-

r

be

simul-

t0

ra.ivate
and

appear

bodies- I£ private enterprise, per-

givi„

'L t

papa"bes. appaal

haps for good reasons, temporar-

Ze'mn0,'i^in,?^flfhnPoiasnShos1' FrJquentBanks and Member Banks Uy does not choose to invest, all
consultations between
Reserve
of

pitals, roads, and recreation facilities.

And

they would ready an

.

apcltty'a tended net saving,

.

.

af,at 'n

f

li

+h

.

,

public bodies must fill the void.

of

be determining

horizons.

situation.

taneous incurrence of debt, either
by private enterprise °r by pubIic

canacities

P.e ®lyan
if

must necessarily mean a

stim-

policies which, in turn, would re¬ health, Welfare, and education is
act unfavorably upon the U. S. a first step towards those broader

Looking Beyond
Our

wartime

and

postwar ex¬

perience gives most impressive
support for the general thesis that
this review has tried to develop.
In

a period of enormous expendi¬
ture, not on great productive in¬
for peace and pros¬

In that case a risin« pubIic debt stallations
additional program for these types
adXd attitudes in eredh nolle e= ia simply a necessity,
perity, but
of investment to make up existing needcd attltudes m credlt PObcies.
deficiencies

and

to

cover

gener¬

ously needs for five years ahead
plan in detail and set up a shadow

organization to swing into action
on

a

few

manner

weeks

we

notice.

this

In

would be better pre-

pared to have an immediate, desirable, and. highly
productive
substitute for possible future defieiencies

in

private

investment,

whether these deficiencies be due
to

—

there

must

be

on the gigantic waste
required by war and defense, our
standards of living and capacities
Much of our popular thinking
for production rose at fabulous
aboUt the pubiic debt is Tmyth.
rates,
simultaneously with the
j
^ often realized that
public debt. -And Our standards
Thus:
of living and productive capacities

a

Sees "Public Debt" Myth

has to perform two functions that
fall upon governments everywhere (and n which monetary
it»_not^ften^lized^tliat
policy must also aid): (1) to pro- { t
burden upon us
since we
vide the wherewithal for needed drroV not abroad tat at home
services that only government at ?bfS "g that we'owe this debt
Federal, state and local levels can
ourselves
it is we Who hold
provide; and (2) to use the vast » oars|wes it is we wno ™ia
economic influence of governenfs in¬
ment
^ a collector and and pro- terest payments from the taxes we
di^nbutor of purchasing power
.
, —
.
.
tbrougb tbe

previous over-investment, ordo
more permanent change_in the
nation's consumption
;vider
a

times

all

At

clear realization that fiscal policy

mmpose

and relentless pursuit of-the

ger-hence-better"
material welfare.

principle

"bigfor

...

of

reasonably even trendsubstantial growth. V

'-.pubiic^debt,
viflir#i -

program of this kind should

quickly effective type, now partly
under way in the form of rising
Federal, state, and local deficits
that
have
been
variously estimated at anywhere from $5 to $10
billion above those for the fiscal
year

1958*

These

deficits

arise

automatically from increased




ex-

-

pass a

i ^

burden on to

f
■

The essence of the process; is
the first function, valuable
and indispensable in itself, is per-

that

friends
fact

and

postwar

aid

allies

abroad.

to

The

despite a more active
economic policy in the thirties, we
still had, in 1939, unemployment
to

that,

the tune of

17%

of -the work¬

the-gectdtte,
represent the great physical assets
public and defense domain
that were at one time created by
bf the

wffl MM

femrtrch ttboffctoky* M
there art victories today,

Itajr eesceri

sen be

when detected

our
ihwki

Is the

tier*

tori#

early nl

promptly#

w vwwff

toy t* this ffcdei#
ere

eevea

eifaald

whiehjnight mean eaaee>r«

force

Vifttaace in heeding to*

of

ewMmwui victory over

only means that the boldness
policy was just not bold
enough; it took a war to bring
about
the
infusion
of
buying
our

that was necessary to throw
the economy into full gear.

power

Compared with that infusion,
only a pittance is required today
public expenditure,
There is no continued sacrifice to get us back into our pattern of
implied in a public debt that al- growth. There is no better time
ready exists and is handed down than this to push ahead With com¬
through the years. A sacrifice is munity facilities—with a really
0nly made at the time the govern- generous effort all over the coun¬
ment incurs the debt, if it borrows try to make good our past sins.
fr0m us what We otherwise might If government expenditure must
baVe consumed; this was the ease take up the slack in private in¬
Above all there is the notion of during the War, but even that vestment to lift the whole econ¬
a
balanced budget as something sacrifice we made in our own be- omy out of its decline, what an
virtuous or desirable or as a pur- half—for the defense of our coutt- opportunity for us at the same
pose in itself.
Those who think try.
In most circumstances, the time to fill the crying need for
that a nation's fiscal budget can act of public borrowing implies schools and hospitals and roads
other
community services!
be compared with that of a family no sacrifice on anybody's part; if and
household should reflect that a the public
expenditure absorbs This need not be a slowly moving
family that spends everything it saving that might Otherwise not program if we push it with de*

formed in such a manner as will t
be an integral part of any policy
accomplish the second function
of combatting the present recesat the same time. If we keep this
sion and of preparing to eliminate essential task of government in
or lessen possible similar difficulmind, we will see difficult questies in the future.
It might be tions of fiscal policy m truer
though t of as a risk-less, common- perspective; and some of its timesense
corrolly to additional in- honored notions will reveal themjection of buying power of a more selves as dangerous superstitions.
A

lavish

of

_

of keeping the total ecpn-

ny on a
ne

Continued to rise through a period

fihtlftetofy
fin «tac«r

ear

for yoti.

f. Unusual

bleediflgordiacftersw

% A lump or thickening in the
Inaet or elsewhere* S» A eore
that does not heaf.4.
bowel

or

Change kt

hleddor habits*

•. Hoarseness or cough,

i. tndb
gestion or difficulty in swaitoi*
Ing. t. Change in a wart or tool*
If your signal lasts longer than
two weeks, go

to your doctor tb

team If It means cancer*

AMERICAN
CAHCTW
•OCiCTY

28

The Commercial and Financial Chronicle

(224)

is that taxes be reduced forthwith

further,

regardless of
the financial position of the
Treasury.
or the wish, is obviously that
owners of funds which otherwise would go to the Federal
Treasury would be taken to the market for goods and
services while the Treasury would continue to spend as
before by means of borrowing. Could anything be more
obviously inflationary?
And could anything be more
clearly harmful, if not disastrous, to men and women
dependent upon small fixed income?

Continued jrom first page

the

It

We See

i As
'

of perpetual depression. We were unable to agree
gentleman at the time, and are still quite un¬
convinced. but it seems clear to us that anti-recession
measures now in popular favor could succeed in maintain¬
expense

with the

(if they could do so at all) only at the

ing full employment

of perpetual inflation.

expense

A Sad

It is

a

Commentary

sad commentary either upon

Continued

measure up to the forthrightness
himself—who blandly termed the rentier of

miserably to

seems

economists for

fifty
As

of the

boom period,
both
the
entrepreneur and
the
wage earner continually increase
their
consumption.
But there
comes a point, not necessarily at
the same time for all products,

is

but

As

soon

as

Once

tion

whose

take the

all

but

part

to the

for

demand
nature of

funds

and

without

and in

•

combination with other
or

factors

mil have,

more




normally

accom¬

other

materials

raw

governed

are

by

world

Statistical

in

a

have

dropped, in most cases heav¬
ily, but the prices of manufactured
goods have largely remained un¬
changed. It is typical that steel
production has dropped to almost
50%
below
plant capacity, yet
steel prices have been maintained.

to

an

on

workers

the
pre¬

hand

on

productive
States

1957

the

increase

capacity

in

the

particularly

was

large and exceeded the possibility
of being fully utilized at normal
output levels.
Recession's Peculiar Features

Usually

the turning point in
activity is clearly appar¬
After having reached its sum¬

ognized

a
great number of
economists, and no one

has been able to refute it.

Keynes later

due

the fact that

to

production is

of

equal

Investments), but he
its full implica¬

investments

the volume

depends

of savings

dependent

of

concentrated in the hands of pow¬

The latter

can

partly due to
the rigidity of wage scales which
are often tied to the cost-of-living

choice

index

the

and

therefore

and

continue

to

in certain branches of indus¬

of

creased
the

that

having reached
December, 1956,
at

almost

months,

its
was

that

with

produc¬
summit
main¬

level

for

production

declines in certain branches of in¬

dustry being offset by continuing
expansion in others.
Thus,
the
lack of balance which had devel¬
oped during the period of expan¬
sion, was partly adjusted before
the decline had become
general.
This early partial readjustment
will most likely have a favorable
influence on the course of the

recession. However, the drop in
production and the number of un¬
^

(Sav¬

grasp

erful

concerns

J. M.

popularized this

on

idea with the Formula S=I

It follows that the

under

turn

crises

the

to

the

volume

only

on

and is in¬

discount

rate.

only influence the

investments:

interest

An

will

rate

in¬

attract

available

savings
towards
profitable investments,

most

and

State

recessions

and

demand

measures

regarded

likely

as

to

whereas

ity

the

reduction will make

The nature of

for less profit¬

savings

that the
followed

proves

as

shown

policy of
since the

cheap money
war by several countries
unjustified; it prevented the
last

was

ef¬

ficient utilization of available cap¬
ital and encouraged credit abuse
and

monetary inflation.

Banking's Inflationary Credits

halt the decline in business activ¬

Savings, in other words, the in¬
acquired but unexer¬

at least to slow it down.

dividual's

shall

or

cised rights to a share in the na¬

We

measures

here

describe

examine

and

these

their

ef¬

reports

dealing

with

these

mat¬

tional
way

product, usually find their
into various credit establish¬

ments in the form of

deposits. The

banks cede those rights to a share
in the national product to indus¬

trialists who wish to utilize them

ters.

for the manufacture of other goods.

Discount

Rate

The first

measure

the

demanded

Generally speaking, the banks
is

grant credits in

production

the

costs

official

and,

above

During the period of expansion
rates
increase
steadily
following
the
increased
profits
made by industry and the con¬

tinued demand for additional cap¬
for new investments.
At the

ital

beginning of a crisis, interest rates
high owing to increased
on

the part

enterprises which

ticularly
or

hard

are

of

par¬

hit

by price de¬
by the reduced demand

their

products, but they soon
a steady downward trend as
profits begin to drop. Usually the

show

official discount rate only follows
the
interest
rates
of
the
free
money market and its impact is"
chiefly
psychological;
a
signal
heralding a new trend of the
country's economy.
Yet, a - reduction
in
interest
can

only have a minute ef¬
the cost price of a product.
Inythe United States, for example,
the interest on borrowed
fect

on

capital

accounts

1%

can
sav¬

which

of

for

the

barely

overhead

additional

currency

However, credits
granted with the help of the addi¬
tional currency issues do not con¬
stitute real savings,' in the sense
of existing national product, but
nominal

purchasing

power

which

only helps to increase the price of
goods on the market.
These

be of

inflationary

use

to

credits

can

the individual enter¬

prises to whom they are granted,
but only at the expense of other
enterprises and the national econ¬
omy as a whole. The resulting in¬
in prices, uneven at first,
eventually add to the diffi¬
culties of the producers.
At the
same time, by reducing the
pur¬
crease

will

chasing power of all consumers to
the advantage of a small number
of

benefitting from
credits, overall consumption

enterprises

these

will be forced down, and the lean¬

ing toward increased saving will
be strengthened at a time when
the national economy is suffering
from

a

lack

of

balance

between

capitalization and consumption. ;It
misconception
industry,-

one-half
in

issues

for this purpose.

interest

rates

of the

cooperation with the Central Bank,

of

all, to liberalize bank credits.

for

excess

ings deposited with them only in

rate; this is expected to re¬

count

duce

Misunderstood

dis¬

reduction

clines

several

by

eminent

tions.

those

in

tion.

^

Keynes' Error

This, then, as we outlined as far
back as 1907, is the nature of sav¬
ings; the fact has since been rec¬

stimulate
consumption
through
price reductions. This attitude on
the part of the producers is partly

recession

the results must

tive, i. e., of not investing, con¬
trary to what is generally believed
by the public which perceives
only the superficial aspects of
economic phenomena.

to

production suddenly begins
to decline. The present American
differs

of individuals

failed

demand for credit

mit.

in

mass

the national economy have no
means
of keeping savings inac¬

remain

tained

it, the

in

ings

ent.

possibly chiefly, in

invest

It shows that industrialists prefer
to cut production rather than to

economic

.

to

or

above

are

other,
pickup in business.

1955 and

national

lend his money
other individuals who wish to

which

markets

the

to

at the expense of other

holders of cash

fer

obstacle

evidence

of

able investments.

to bear out the fact that be¬

United

services

economy

is normal that, in our era of
the Welfare State, those who suf¬

reduction in production

brings about

even

acquired in cash in return

his

savings available

from reduced wages on the

much reference

followers .should recession proceed much

which

in

decline

for

try.

ity of the product, resulting from
shortage on the one hand and

Then another demand which has followers and which
..

overall

quick
readjustment
of fects,
summarizing
briefly
the
to the utility of the pro¬ views we have advanced and ex¬
The decline in production
plained in detail in our works and

tween

goods and

of

rise

continues until the rise of the util¬

the assets to be

later appear particularly,
the form of higher prices.
: sooner

the

a

the

acquired. Fortunately
business ordinarily is not nearly so ready to rush to the
banks for accumulation merely because it costs less than
formerly. The experience of the Thirties made it clear
enough that mere cheapness of money does not necessarily
induce great use of it on the part of the business com¬
munity. It must be said, though, that if policies of this
sort have the effect hoped for by the modernist they are
definitely inflationary and it must be added that in time

some

instead

power

a

seems

capacity, the produc¬
consumer

consumer

manufacturers

unions and

of

duct.

growth of bank lending—regardless of the volume of

natural

of

additional

insurance, resistance

wages

Federal Reserve do all that is in its power to encourage
the

and

is the chief

vent

active, the

that

stimulate

Labor contracts, unemploy¬

ment

It is all but

demand

marginal

prices drop below produc¬

costs

costs.

finance normal transactions

unanimous

to

adequate

again in the usual volume—and the net final result is
undue expansion of bank money.
Then

.

ciently, they are obliged to reduce from it measures to stop the de¬
production by shutting down their cline in production and the in¬
least efficient plants and releas¬ crease in unemployment.
At the
ing part of their personnel. Since same
time, democratic govern¬
production costs depend largely ments J'eel that they cannot avoid
on
wages, the rigidity
of wage the obligation of taking certain

lead to bank absorption of

more

in

down

come

reduced

and

ited and regulated by the volume
of savings. For the national econ¬

It

order

scales

business becomes

banks wall be called upon to

then

the

consumers.

unable to reduce their costs suffi¬

"Treasury obligations—in other words to the issue of the
modern form of greenbacks. The mere fact that for the
time being other types of borrowers do not come to the
banks in such numbers for so large amounts as when busi¬
ness is booming does not render the Treasury program
harmless.

must

the

of

buying.

to many billions

economic activity.

a

utility of goods for the
in

Proposals

course

In

prices
of
consumer
longer correspond to
needs for such goods

mass

with

line

from virtualy all the "advanced thinkers" insisting that
spend more than it collects in
a

the

Prices

the Federal Government

inevitable that such

no

actual

by

depression proposals of the New Deal and its successors
to see that they are definitely and inevitably inflationary
in nature. Take, for example, the hue and cry that goes

taxes in "order to spur

the

goods
the

to examine a few of the anti-

necessarj'

population.

when

•of dollars.

It

that the goods produced are
excess
of the requirements of

in

Keyes), would be obliged to express a low regard for the

A Few

ten¬

a

sense

policies, allegedly designed to further the interest of such
elements in the population, actually tend very strongly to
undermine the value of the savings so hardly accumulated
and, for that matter, to make it doubly difficult for them
to accumulate savings at all. The New Dealers, had they
a true understanding of things economic and were they as
frank as their intellectual godfather
(John Maynard

come

•

Another peculiar feature of the

man's perpetual
his prices

towards overcapitalization
and
overproduction, interrupted
by readjustments made necessary
by periodic overproduction.
We
do not mean overproduction in the

good many others who
heard to say
that these small savers are functionless, and certainly they
would never talk about bringing them to a painless end.
The fact remains, however, that they are the worst ene¬
mies these rentiers have in this world. They are poor
friends of these "little fellows" for the reason that their

together

continues.

absence of

with

fraction

a

considerable

a

widespread
misconception
con¬
cerning the effect of the discount
rate on the volume of credit, and,
hence, on the volume of invest¬
ments.
Disregarding the move¬
ment
of
capital
to
and
from
abroad, the volume of investment
in the national economy is lim¬

stocks

partly in present American recession is the

dency

admit New Dealism, are never

accumulations all taken

-

found

be

to

economies

national

But the New Dealers, and a

saver

is

tion of durable

capital—an inclination which, as panies economic crises, stimulat¬
has been stated by Adam Smith as ing consumption and the absorp¬
of excess
well as by many others, largely tion
production.
The
overshadows his desire to increase cost-of-living index has continued
to rise since October, 1956.
his consumption—, and^ partly .in
This
however
the technical organization of in¬ is
largely due to in¬
creased food prices following un¬
dustrial production in economi¬
cally advanced countries. The re¬ favorable weather conditions. The
sult is a continued expansion of prices of non-ferrous metals and

economic function

smaller

There

goods of all
goods produced
employed have already exceeded for
current
consumption
only.
those of the two previous reces¬
Now, whilst an individual can
sions, and the business decline temporarily invest his purchasing

inclination towards increasing

the

value of the

are

human nature, in

dation in fact.

and social

•

,

writings since 1907, the

our

causes

hundred and

some

-

have consistently pointed

we

out in

accumulating pension benefits, and in this capacity his
name is legion.
One needs but take a glance at the assets
held by such institutions as these to understand the tre¬
mendous part they pay in financing American enterprise.
Any claim that such investors are functionless or deserv¬
ing of euthanasia is obviously without the slightest foun¬

economic

years.

short-term bor-

on

of this percentage.

in general, savings spell in¬
vestments, i. e., the creation of

object of much controversy among

Is

never

while interest

rovvings represents only

kinds

to perform and who should die painlessly? Well, he is the
depositor in mutual savings banks and building and loan
associations. He is a holder of life insurance policies. He

would

Thursday, July 17, 1958

.

productive

wholly invalid.

Who is this "rentier" who has no

.

omy

page

and Remedies

"func¬
tionless investor" and advocated his euthanasia. Such
candor demands respect even if the reasoning employed

:

from first

or

upon

master

up

budget
The thought,

the understanding

the sincerity of the New Dealers in and out of
politics that they profess great concern about the "little,
fellow," and at "the same time press forward with pro¬
grams which must almost inevitably be his undoing. In
this respect many of the follows of the man who is often
thought ol as the intellectual father of the New Deal fail
convinced, but it seems clear to us that anti-depression
or

of the

state

.

of

is therefore a grave

Volume

183

Number

5760

.

.

.

The Commercial and Financial ClironicL

(225)
to consider inflationary credits
a

against crises and de¬

pressions.

to- public
work for

It is rather like throw¬

weapon

number of

ing sand into
to make it

of

unemployed, and which

salaries

1931,

of

the

about

IBA Southern Group Names Labouisse Gov.

Australian
an

av¬

NEW

erage reduction of 10% of the real

its jurisdiction.

by

J.

M.

million

increase in the

an

will

Special

stimulate

Government

Purchases

What

have

we

said

about

spe¬

.

-

against

weapon

re¬

In the

Arbitration

Zealand

same

by

the

national

the

overall

demands,

prevent

the

this volume

of

effective

nor

long

decline

the

as

sion lasts. There will not
any
■

marked

tribution

in the
able
from

of

last

they

can

gradual
as

cannot

revenue

volume

changes

of

reces¬

even

experts

in their report on full
employment recommended the use

Germany, the decreey of Dec.

in the

dis-

except

where

avail¬

case

the

purchasing power is switched
capital goods to consumer

8,

therefore

national

be

current

did not dare take such direct and
courageous
ferreu

and

measures

pre-

to

follow, the example of
the British Government which, in
1931, arrived at the same result
by. a
more
devious, method,
.

namely,

by

devalution

a

of

the

';VS

currency.

Relying

the relative rigidity

on

of nominal wage scales, this meas¬
ure
was
aimed at reducing real

by

wages

about

rise

a

in

tion,

of

economic

life

and

at-

the

arbi¬

of

expense

of

demand

thus

In

this

run

Under

context

it

should

be

noted that

during a period of ex¬
savings
increase
more
rapidly, percentagewise, than

pansion

overall consumption of

goods, thus

there is

no

other

done
any

circumstances
cuts.

wage

nothing

prevent

" agreement

should

wage

to

On the
be

cuts,

and

end

be¬

that

lack

a

of

balance

be¬

The

economy.

of

the

resources

for their completion can thus only
come
out of new taxes or loans.

They

do

not

increase

loans,

and

these

temporary

—

1

1

■■■'

1

i

•

t

expensive,
tion

since

involves

penditures

require

since

and

of

may

jobs
for
qualified.

organiza¬
ex¬

they

often

relocation

costly

housing
who

their

considerable

and

unemployed workers,
often be employed in
which

These

they
are

are

the

not

reasons

which obliged the British Govern¬
ment
in
1925
to
abandon
this
method of

It

was

At the

in

.

_

Significant business indicators cited by Cleveland Trust shows
business improved at end of second quarter compared to begin¬
ning. Believes there is likely prospect for more than seasonal
upturn in fourth quarter.
According

the

to

Cleveland

Company's July "Business
Bulletin," "business as a whole
at

the

end

of

the

second quarter than at the begin¬

ning.

That is because the steady

decline which commenced last fall
was

halted in

May and June. Thus

the Federal Reserve index of total

industrial

that

the

beginning of this study,

have cited the rigidity of wage
as
one of the main causes

these

involved

works

of

depression.

Cannot

the

Gov¬

-

Must

we

ments in industrial

production?
States

and

the

impose
scale

wage

equipment and

Does not the United

Government

wages

ment

fix

minimum

French

Govern¬

sliding minimum

a

tied

index?

to

the

There

is

cost-of-

lack

no

1930, the Italian Government
duced
ants

the

and

between 1933 and 1938 the United

ganized

States

campaign

allocated

$10.5

billion




to

we

Eisen¬

vitality
economy," and to be¬
ware of "unsound programs which
would do great damage instead
of contributing to economic
strength."
Human

pride

may

salaries

at

an

the

of

civil

same

extensive

re¬

serv¬

time

or¬

propaganda
advocating a general

orders, which have climbed well

must above the period of cutbacks dur¬

suffer from

this inability to interfere success¬

will benefit from it.

products when the utility de¬
as
a
result of improve¬

in

remind ourselves that

that

trial

creases

were

than to undertake special
projects,
when of a productive nature.

President

fully, but the country's

ex¬

even

to

opinion

ernment intervene to bring wages
in line with the utility of indus¬

of precedents for such a policy,
carrying out and measures of this kind have
channelling been taken by several
govern¬
capital away from more produc¬ ments
of
all
political leanings
tive uses, and that it was cheaper
during the great depression which
to
pay
unemployment
benefits followed the crisis of 1929.
In
penses

subscribe

hower's

have "faith in the inherent

scales

fighting unemployment. living

considered

of
are

Lower Wages Proposed

we

being

measures

economy

ing the summer and fall of 1957.
Sales

were

increased

steady

in

May,

tories continued

sequently

the

to

ratio

in

April

while
decline.

and
inven¬
Con¬

of stocks

to

sales dropped noticeably from its
March peak, which suggests that

inventory liquidation is well along
toward completion.

"(2) Construction. Although out-,

lays for all construction put in
opinion on the economic
place have been sliding, contract |
policy to follow with regard to
awards—which precede the above:
crises
and
depressions has not
changed
since December,
1932,
when a member of the "Brains and that nothing should be done
Trust" instituted by the President¬ to trouble its normal course.
We
Our

elect Roosevelt for the purpose

of also argued very forcefully against
policy a devaluation of the dollar which
visited Europe to consult with a the "Brains Trust" had apparently
number of European economists, contemplated. But there was great
the writer among them, on meas¬ pressure to overcome the depres¬
ures
to
combat the
depression sion in a hurry, and there was a
from which the United States and strong belief that this could best
the entire world were then suf¬ be
achieved
by extraordinary
fering. It was then our opinion measures, inspired by an ideology
that
the
economic
life
of
the which was fashionable during that
United States had, since July of era.
The catastrophic effects of
that year, entered upon the up¬ the measures then taken "should
ward phase of the economic cycle serve as a lesson today.
preparing

his

economic

1

Cleveland Trust Sees Better Business Prospects

tween management and labor can

of the free

overall

works, moreover, whilst
less productive, are very

shortcomings

well-known.

demand.
Such

the

Roddy

Kees,
Jonesr
Inc., New Orleans; J. B. Sanford, partner, White, Hattier and Sanford, New Orleans, and Ed S. Lewis, Jr., Lewis and Company,
Jackson, Miss.

only improve the situation of the

creating

E.

James

are:
Jackson P. Ducournau, partner, Ducournau and
New Orleans; James E. Roddy, Vice-President, Scharff and

possibility of govern¬ looked better

hand,
to

Ducournau

Trust

present

ment-ordered

P.

ing

this

remedy are in the
infinitely greater than

Jac

Executive Committee of the Southern Group at the July 10 meet¬

the

its advantages.

volume

long

Labouisse

ing firm, Howard, Weil, Labouisse, Friedrichs and Company, will
serve a three-year term.
He previously served as Chairman of the
Southern Group.
:o\-'
;
r.....
Louisiana and Mississippi investment bankers elected to the

trarily and unjustly upset the
entire distribution of wealth and
re.venue

P.

Mr. Labouisse, a partner in the New Orleans investment bank¬

n g

prices. This ac¬
shook the whole

however,

basis

John

/

artifically bring i

overall

remains unchanged.

undertaken

product

3
on

-

—recorded

1

marked gain in May,
The residential sector has pickerl
a

measured by the number o!
dwelling units started.

up, as
new

"(3) Personal income.' This hafl
been

rising gradually since Feb¬
Total wage and salary pay¬
are down moderately from
the level of late 1957, but that has
been offset by increases in unemployment
compensation
anc!

ruary.

ments

,

the

at

reduced wages to the'
of Jan. 10,
1927, canceling
all raises which had taken
place
during the boom period 1927-1929.
However, the majority of States

production fell from 145
capitalization and produc¬
goods.
industries most affected.
in August of 1957 to 126 in April,
tion on the one hand, and overall
Public Works
v
Having examined all govern¬ but then edged up to 127 (prelim¬
consumption on the other.
In a
Among anti-depression
meas¬
recession, the opposite takes place ment measures usually taken or inary) in May. Based on the few
ures, public works are particularly
and
savings, originating mainly recommended to fight a recession, available weekly series, the June
popular. It is believed that they
from profits, decrease much more we can only retain one as being index is likely to show a further
provide the unemployed with the
In the first two or three
rapidly than overall consumption. more or less practicable, namely, rise.
possibility
of
drawing
normal
It follows that even in this phase the reduction of taxes in the de¬ weeks of June, after seasonal ad¬
wages
and of thus maintaining
We have dis¬ justment, gains occurred in the
of economic evolution a certain pressed industries.
consumption, whilst at the same
of steel, electric power,
volume of savings is necessary for carded all other measures as being output
time works are carried out for
maintenance and repairs of in¬ either ineffective or as dealing soft coal, and petroleum, and also
the benefit of the community. This
dustrial equipment and urgent in¬ with economic problems from the in rail freight carloadings.
too is a great illusion. Such works
point of view of private economy
"Aside from recent increases in
vestment in industry or in fields
can
in certain cases usefully re¬
rather than that of the national
not affected by the crisis.
production, notably of steel, sev¬
place unemployment benefits as a
economy. The organization of the eral other important business in¬
means
of combatting
unemploy¬
Lighter Tax Load Discussed
economic life of a great and vast¬ dicators
have
been
exhibiting
ment, but they are useless as a
It seems to us that if the fiscal ly industrialized country is a very signs of improvement after allowmeans of fighting crises and
de¬
complex and delicate one, which ance
for
seasonal
variation.
system is to be used as a weapon
pressions. They consist of building
is badly suited to any outside in¬
against depression, it would be
Among these are the following:
roads, dams, public buildings, etc.
terference.
Under these circum¬
more
appropriate temporarily to
These
are
long-term
projects
Significant Indicators
lighten the tax burden which is stances, it is better to let the
requiring much time for comple¬
recession run its normal course.
"(1) Manufacturers' new orders
tion.
Once completed they may hampering production, especially
Just as the human organism pro¬ and sales. After a lengthy down¬
in the branches of
industry most
increase the country's productivity,
duces antibodies to defeat germs,
swing, new orders rose substan¬
affected, thus enabling the pro¬
but
in
the
interim
they
add
the economic life finds its own tially in March, slipped a little in
ducers to reduce their costs and
nothing to the products at the
remedies to restore the lack of April, and then moved up in May
lower the price of
disposal of the country for con¬ thereby to
balance developed during the pe¬ to the March level. Much of the
their product. But here
again, a
sumption
or
investment.
They
riod of expansion.
One can only gain stemmed from larger military
tax reduction must be offset by
from

America

1931,

effects of

tween

must

of

•;

level

marked for investments and put it
at
the consumers'
disposal. The

be

consumption,

Association

."I

Gov¬

a

20%.

In

mass-of smalli-savers,
of
fiscal
pensioners,
policy
as
a
weapon
They are a means of
and retired people, whilst
depression.
at,the.
They
con¬
helping the unemployed at the ex¬ against
same
time bringing the risk of
sidered that by reducing
income
pense of the community.
They
taxes and
Social
Security con¬ reprisals from other governments
cannot, therefore, have much in¬
and monetary wars. And all this
fluence on consumption as a whole. tributions and by increasing fami¬
for a few months of respite after
ly
allowances,
the
purchasing
The funds for the payment of
which the Trade Unions reopened
power of the consumer and thus
unemployment benefits can orig¬
overall consumption would be in¬ the struggle for a readjustment
inate from three sources: econo¬
creased. Yet, the State can afford of wages
in relation to prices,
mies made on other public ex¬
such
largesse only by floating accompanied by social troubles
penditures, new taxes, or loans. new
loans. In this case it must and serious losses to the coun¬
All these changes in the allocation
withdraw purchasing power ear¬ try's economy.
The detrimental

affect

Bankers

July 10.

cession.

of

Investment

elected

New

wages

reduced

in

the

was

meeting of the Association's Southern Group in New Orleans

year,

Court

of

ORLEANS, La.—John P. Labouisse

"

r

should not overestimate their im¬

ernor

basic wage for all workers under
the

employed back to work. This is cial
public works also applies to
confusing money as a means of
special Government purchases. In
exchange with capital, and nom¬ order to
pay for these goods, less
inal demand with real demand. :
urgently required and thus of less
Price reductions are the normal use than normal
purchases, the
and natural way to increase con¬
Government must float loans and,
sumption and to achieve outlets
consequently, •. channel available
for excess production. In order to
capiuu away, frout iiiore
stimulate consumption, " economic
live uses. It is thus, an illusion to
policy measures are often recom¬
believe
that these goods
effec¬
mended.
"
-.
.r
tively increase the. gross national
product. By acting in .this
manner,
Unemployment Benefits ; ,/>
the State only reduces the
produc¬
Following this line of thought,
tivity of the national economy and
unemployment benefits are gen¬
increases its debt. On the other
erally considered as a means of
hand, if the Government has re¬
automatically
maintaining
con¬
course,, to
monetary inflation to
sumption, and it has even been secure
the necessary cash, it will
advocated to increase unemployonly add to it the ill effects of
ment benefits during periods of
such an inflation.
recession. Unemployment benefits
In
1949, the United Nations
are useful and necessary, but one
a

of

In'

remaining at nearly 10
throughout this period?

One of the

spread

money

as

10%.

did not prevent their number from

effective demand and put the un¬

portance

reduction

Arbitration Court decreed

better.

run

Keynes is that

supply

works, which provided
only 10% :of the total

clogged-up engine

a

fallacies

great

as

20

other kinds

some

of income.

"(4) Employment. In May, after
seasonal
adjustment, the down¬
trend in nonfarm employment waar
reversed; average weekly houn»
worked
and

in

factories

unemployment

moved

as

up;

percent

a

of the labor force turned down.
'

h

■

.

J" ,■■'k

'iti

•'

•

>

Conclusion

"Developments such as theso
improved
business
senti¬

have

,

ment.

This

does

not

that

mean

should go overboard on third'

one

quarter

which

prospects,

seem

rather indecisive at this stage. Bui

there is

more

hope for

somewhat greater

-

up

than

-

turn o£

seasonal

dimensions in the fourth quarter.'*

With B. C.
(

Christopher

Special to The Financial Chronicle)

KANSAS

CITY, Mo. —Ray A.

Ricketts, Jr. has been added to tho
staff of B.

C.

Christopher & Co.„

Board of Trade

Building, members

of the New York Stock

He
Peet

was

&

previously
Co.

Exchange.

with

H.

O.

The Commercial and Financial Chronicle

80

.

.

Thursday. July 17, 1958

.

(226)

'A A and power
vx

and

Philadelphia clearings reached $948,000,000

with $946,000,000 or an increase of

offering
Corp.

'

stock

common

the

at

rate

of

1958. The
subscription price is $27.50 a share.
The rights to subscribe will expire
on July 30, 1958.
This offering is
also being underwritten by a group
managed by Lehman Brothers.
»
Of the net proceeds to be re¬
ceived by Burroughs from the of¬
ferings approximately $18 million
wfll be applied to the retirement
of record

on

July

16,

of installment notes.

The balance

will be applied initially to the re¬
duction of current indebtedness.

ing capital requirements of the
company arising from larger in¬
vestments in receivables and in¬
fixed

as

well

representing

assets

"Iron

the

near

Age"

future.

how sales are
that basis.

means," reports the metalworking magazine^ "that the
automakers are buying only what they think they will need to
are

trying to convince them they should build
well. No one is sure how the new model

public. But having spent the better part
adjusting material inventories, the car-,
through the process again next year. 'So,'/

will go over with the
of the present model year
makers don't want to go

they reason, 'buy what you think you need.
always get it'."

encouraging angle of the June steel
that only about 20% of it represented price hedg¬
ing. "This would indicate that the great majority of customers
who have been placing orders during the last 40 days have been
doing so because they need the steel quickly and not because they
are speculating on the timing of the expected price advance."

The

proceeds of the sale of common
stock will of course serve as ad¬

i

Loadings Again Show Decrease "

of 77,673L cars or 44.5%
and

v

decrease of

a

r

Loadings
v

was

in

the

T

'

-

comparable

the.

cars,

decrease'

was a

below the corresponding;

4.3%

or

This

corresponding week rin' 1957,/

below the-

20,636'cars

week in 1956.

/

weeks

of

I

.

1957

and

1956

were.

affected by the July 4 holiday and the coal miners' annual vacation."
In addition, loadings in the 1956 week" were reduced lurthfer due
to the nationwide steel striked

-

-

•

Loadings in the week ended July 5

were

168,912 cars

27% '

or

•

'

below the preceding

If you need more,

Meanwhile, says "Iron Age," the furor over the delay in the
steel price rise has died down. Everyone seems to be marking time
until U. S. Steel Corporation makes up its mind to move on prices.;
It still looks as though August will be the crucial month, although
there is little if any hedge buying on that basis.
<

bulge

■

•

ended

Association of American Railroads announced.

'V- *•;

week.

~

y';;:

.

Passenger Car Output Near Normal Level

you can

"Iron Age" says that one

equip¬

Car

as

cars

■

week

Loadings in the week ended July 5 totaled 457,661

-

"Steelmakers

their steel inventories

the

;

according to the Edison,
A/AAA:
£

July 12, 1958, output increased by 641,-.
000,000 kwh. above that of the previous week.-However, it was/
113,000,000 kwh. below that -of the comparable 1957 week ' and r
973,000,000 kwh. above that of the week ended J\ily 14, 1956.
A

they have scheduled.

cars

Electric Institute.
For

they

"It

build the

11,851,000,000 kwh.,
'.".AAA'
■;,aA '' '

at

.

the word from the automakers is that

says

plan to go slow on new model output until they see
going. And they are placing their orders for steel on

order

increased

as

leased to customers.

ment

market in

Incoming orders during the past week have shown seasonal
declines, but practically all steelmakers look for some improve¬
ment in August. The market situation varies by districts.
In at
least one area some steel firms report new business is equal to the
same period, in June, when orders were fairly high.
/ - -

The Obligations to be retired were
incurred to meet increased work¬

ventories

1958 compared*

Cautious in Steel Buying

Auto Makers

it

iii

0.2%.

According to "The Iron Age," national metalworking weekly,
looks "as though Detroit will be of little help to the lagging steel

11 shares held

share for each

one

estimated

was

Burroughs

of

/ ' ;
distrlbjuted by the. electric light ■
industry for thej^vCek eh'ded'Saturday^ JciIy T2,1^58, -

Outpu^JSlightly .Ifigher the Past Week

The amount of electric energy

•

of $25,000,000
4%% sinking
fond debentures due July 1, 1983
is ^beingmade today (July 17) by
an underwriting
group managed
by Lehman Brothers. The deben¬
tures are priced at 100%.
Burroughs Corp. at the same
time is offering to holders of its
common stock the
right to sub¬
scribe fear 550,058 additional shares
Public

Electric

Continued jrom page 4

Offertty Burroughs
Corp. Underwritten
By Lehman Group

"Ward's. Automotive Reports" is

on record that passenger car/"
at United States plants bounced back this;
levels, mote than doubling the abbreviated' ;
volume of last, week's holiday-shortened schedules.
;
truck production

and

week to near-normal

r'

The week's output, as

^tabulated,by-"Ward's," yras comprisedi;
arid 15,275 trucksjagainst 35,273 cars andT7»742 trucks; *

of 73,846cars

during the July 4 week.
'

-

'

v

j

A

-

-

A

-

-

-

However, "Ward's" noted that compared to the same week in1957, car output lagged 34% while truck-making was off 32.4%."A"
Last year at this time, factories had turned out 111,943 cars and
22,610 trucks for the week.
;

General Motors

-

-

•

.

.

.

primarily responsible for this week's pro-';
duction spurt. Except for Buick.which has gone down for model;
changeover,

the

"Ward's" said.

ating. 4

;

was

various

GM; divisions

Last week

only

|

•

-

resumed car assembly,
few Chevrolet units were oper¬

a

'

Steel stocks in the hands of most users

ditional

equity under presently
outstanding and future borrowings
Sinking fund provisions of the
become

effective

At its option Bur¬

retire up to an addi¬
tional
$1,000,900
of debentures
annually. For the sinking fund the
debentures will be redeemable at
roughs

may

They also are redeemable at
option of the company in
whole or part at anytime at prices
ranging from 105% to par, except
that they may not be redeemable
prior to July 1, 1963, with pro¬
ceeds of a refunding operation
par.

the

with

an

interest cost to the

num.

during 1957 totaled $282,774J)00 and net income was $10,075,000, equal to $L67 a share on
the average number of shares out¬
standing during the year.
Burroughs Corp. and its subsid¬
iaries are engaged in the produc¬
tion, distribution and servicing of
more than 200 different models of
including

a

line

of electronic data computing sys¬

tems,
a

a line of office supplies and
line of business forms. In addi¬

tion fhe company is

a supplier of
military goods with specific em¬
phasis on electronic systems and
control apparatus of various kinds.

FIG Banks Place Bebs.
The Federal Intermediate Credit
Banks

are

offering today (July 17)

issue

new

a

of

approximately

$117,000,090 of 2% nine-month de¬
bentures dated Aug.

1, 1958 and

maturing May 4, 1959.

Priced at

pat, the new debentures

are

offered

being

through John T. Knox, fis¬

cal agent

of the banks, and

a na¬

tion-wide ^selling group of securi¬
ties dealers.
!

It

was

also announced

maturity of Dec. 1, 1958

that

an

was

a

re¬

opened for $4,000,000 and was sold
at

a

days.

Demand for steel won't

pick

up

markedly before September,

from

the

financing

Wflfl be used to refund $106,000,000

4%% debentures maturing Aug. 1,

 lending operations.
J958, and for


Bend

was

the

only

car

'

com-

'

.

*

i

•

-

M

-

4

.

Lumber

Shipments Were 16.5% Above Output
In the Week Ended July 5, 1958
•" '

companies will
operate in the red this quarter if they delay long in raising steel
prices.
V/
•' '-'A; ;A;
A./
a'a-A

Lumber

June

28,

:

!

shipments of 480 reporting mills in the week ended

1958,

were

16.5%

production, according to
In the same period

above

the.ft

when inventory reductions will have run their course and auto¬
makers will be turning out '59 models.
If nothing is, done until

National

then to compensate for the

36% of stocks.

many

Compared with the previous week ended June .28, 1958, production of reporting mills was 36.7% below; shipments were 33.3%

higher labor costs they incurred July 1,
companies will be in trouble. No amount of cost cutting will
them from deficit operations.

save

The company most observers think will lead the parade to
higher prices, U. S. Steel Corp., is the one that can best afford to
stand pat, the metalworking weekly said.
It earned 7.8 cents
on
its sales dollar during the first quarter when the industry
average was 5

quarter.

cents and did

well

as

Its breakeven point is

one

or

below;

reason

for U.

S.

Steel's "wait and see"

attitude

is

prices aren't advanced by mid-September, look for one
big mills to take the lead in raising prices.

or

Steel

users

will absorb

of the

more

coming price increase than

in

any postwar hike, "Steel" survey indicates.
Respondents are
nearly unanimous in believing that the boost will come, even
though it didn't arrive on July 1.

How much of the increase

will

be

absorbed

depends on the
size of the increase and the industry in question. But partsmakers
will absorb 55% of a $6-a-ton raise; makers of capital goods will
absorb 80%; manufacturers of consumer durables will soak up
90% of a $6 hike; and makers of construction equipment will
absorb 60%.

Reports

shipments

protect themselves against a fall rush.
Steel production rose a half point last week to 53.5% of ca¬
pacity. Output was about 1,445,000 net' tons of steel.
"Steel's" composite on the prime grade of steelmaking
scrap
held at $35.67 a gross ton last week.

*'

and

from

to

^

275

in

-

the

week

'

&1

week of 1949 when '
AAAA
:i
liabilities of $5,000 or more declined to A

than in the comparable
.

involving
in

258

the

"

j:

prewar

-A

;

.

but exceeded the 216 last A
Small failures, those with liabilities under $5,000 edged to

year.

previous week

in the similar week of

from 34

cumbed with liabilities in

excess

preceding week.
Retailing casualties
and

fell

Inc. However, casualties remained higher than the
week of last year and the 272 in 1956. Failures were I

recorded.

were

failures

industrial

10 from 292 to the preceding week, reported Dun

Failures

39

*'

below. As against the corresponding reporting mills was .9.0% above; *
2.1% above; and new orders were 11.1% above.
A?

were

July
Bradstreet,
comparable
1% higher

„

1957.

Fifteen

businesses

suc¬

of $100,000 as aginst 26 in

the-A

,

were down from last week to 128 from 156:
manufacturing down to 54 from 57. Meanwhile, wholesaling:
edged up to 26 from 20, construction to 41 from 39,

casualties
and

service

commercial
a

to

was

from

20.

Price Index

Wholesale Food
There

26

More

businesses

failed- i

in all industry and trade groups except retailing.

year ago

Pittsburgh

and Detroit indicate that auto¬
makers are anxious to get started with '59 models. At Pittsburgh,
Chevrolet's stamping plant is asking suppliers to deliver sheets
two weeks ahead of schedule. At Detroit, Chrysler Corp. is order¬
ing bars for late August delivery.
(They'll be used in suspension
systems, unchanged for 1959.)
General Motors Corp. and Ford
Motor Co. are ordering stainless for delivery in late August and
early September. Long leadtimes suggest that car builders want to

AAN^A

Business Failures Again Lower

236

new.''

Unfilled orders amounted to :n-

yv

•/.

Commercial

than

from

Barometer.

new orders were 12.3%
in 1957, production of

week

272

of the other

Trade

37.8% above production.

better during the second

that business conditions aren't right for an increase.
If

Lumber

were

ended

The main

more

orders

of the lowest of major pro¬

ducers.

Slips Somewhat

fraction decline in the Dun & Bradstreet whole-;'

a

sale food
a

price index. On July 8 it slipped 0.2% to $6.65 from $6.66
earlier, but was 6.1% higher than the $6.27 of the corre-

week

sponding date

a

year ago.

*

.

.

Commodities quoted higher in wholesale price this week were A
lambs, barley, lard, sugar, eggs, cottonseed oil, and potatoes. Lower;
in cost were hams, hogs, wheat, corn, rye, oats, coffee, and cocoaA
The Dun & Bradstreet wholesale food price index represents *

the

total

sum

meats

in

of

general

the
use.

price per pound of 31 raw foodstuffs and
It is not a cost-of-living index. It chief
trend of food prices a the wholesale

function is to show the general

Further Kise Is Scheduled in Steel Output for This Week

level.. "A

•

:

.,

,

;.

'
v

The

American

Iron

and

Steel Institute

announced

that

the

operating rate of steel companies will average 94.3% of steel
capacity for the week beginning July 14, 1958, equivalent to
1,515,000 tons of ingot and steel castings (based on average weekly
production for 1947-49) as compared with an actual rate of
*89.8%
of capacity, and

1,442,000 tons

a

There

Estimated percentage for this week's fore¬
capacity, up from 53.4%, the second straight
weekly advance from the July 4 holiday period when output
declined to an 8 week low of 1,376,000 tons or
51% of capacity,
the American Iron & Steel Institute reported.

56.1%

of

For the like week

duction 1,751,000 tons.
was

month ago the rate was 109% and pro¬
A year ago, the actual weekly production

a

placed at 2,030,000 tons

or

126.4%.

and

on

average

coffee.

On the

a

The

slight decline in the general commodity price i

reflecting lower prices
Dun

&

on some

Bradstreet, daily

livestock, grains,'

wholesale

weekly production

comparable date

a year ago

a

commodity'

week earlier.:

the index stood at 292.11.

Hot Weather Boosts Retail Trade Volume"

in the week erided July 9 sparked'
buying of summer apparel, air conditioners, fans, and
picnic foods, and total retail volume equalled that of the similar
week last year. Spot reports indicated that sales of new passenger
cars slipped somewhat from a week earlier, and remained notice¬
ably below a year ago.
A
'
The total dollar volume of retail trade in the July 9 week
Hot weather in many areas

consumer

was

*Index of production is based
for 1947-1949.

was

level this week,

140,742,570 net tons.

cast,

j.

Wholesale Commodity Price Index Down

price index dipped to 279.11 on July 7 from 279.45

week ago.

Output for the week beginning July 7, 1958 is equal to about

premium for delivery Aug. 1.

Proceeds

were

53.4% of the utilization of the Jan. 1, 1958 annually capacity of

issue already outstanding with

South

at

idle this week, although many plants of other - companies •
down for the week, "Ward's" observed. Others worked four

pany

"Steel" magazine stated on July 14 many steel

Consolidated sales and other in¬
come

business machines

Studebaker-Packard

;

com¬

of less than 4.46% per an¬

pany

Metal-'

ability of steel is plentiful."

on

July 1, 1963 and require the com¬
pany to retire a minimum of $1,OOOJOOO principal amount annually
during the period July 1, 1963-,
1982 inclusive.

at low ebb.

working companies are assuming they can get more steel in a
hurry when they need it. "This," says "Iron Age," "will lead to
short-term pinches in steel supply even though the overall avail¬

of the company.

debentures

are

from 2%

below to 2%

higher than a year ago, according

spot estimates collected by Dun & Bradstreet, inc.
There was a upsurge in the buying of women's

to'

swimwear,

Volume

188

Number 5760

The Commercial

Financial Chronicle

ana

(227)

31
.'t

sportswear, and cotton dresses during the week, and
suits and

summer

volume

coats matched

in women's

Despite

ago.

exceeded

that

a

weather

for

the

lack

of

interest in

linens,

to

preparation

for

the

long

holiday

those of

noticeably in Philadelphia and New York.

a

vasions of the annual stockholder

meetings
g)re
all
the
more
remarkable." Mr. Shine
continues,
"It is important that a stockholder

opposition

pleased

were

with

the

:J:

a

Conditioners

at

nual

over

stepped up their buying of back-to-school clothing
with principal gains in girls' sweaters and skirts and boys'
sports jackets and slacks. Volume in women's fall dresses, milli¬
nery, and accessories rose appreciably and equalled that of a year
ago, while bookings in summer clothing slackened noticeably.
There

bear."'

scattered

re-orders

for

men's

a

year

ago

in

a

A

for

these

his

people

the

bitter

:

the

and

_

strength of the independent share¬
duties at the annual meeting con¬
tinues to mount. Those they sup¬

carpet

wool

declined

holders who know their rights and

considerably,

especially in
Philadelphia and Boston; Despito some scattered orders for print
cloths and sateens, transactions in cotton gray goods lagged. Inter¬
est in industrial fabrics and man-made fibers
equalled that of the
prior week. '
v. '

the

level

of

a

The

book

value

of

w

.

There

was

15% rise in initial claims for unemployment in¬

a

in the week

June

ended

the

in

Terrorized

the

and

more

ranks

the

of

Day holiday and

model changeover period cut automotive output by 62% this
to the lowest level since early October, last year's model

organization which

an

a

the

anew

interests

of

the

In contrast to the

thinking they
with scorn, they ap¬
plaud
statements
such
as
this
which appeared in the April issue
look

period. Some makers reported scattered labor difficulties.

upon

Following a week of reduced operations due to the holiday,
Steel output is slated to rise 6% this week. Except for some book¬
ings from farm implement manufacturers and oil refiners, new
orders for steel lagged.
Some steel officials expect a substantial
gain in new orders in August, when automobile manufacturers will
begin producting 1959 models. Most anticipate that July orders
will be below June, but the postponement of price increases may

shareowner—whether he holds

help lessen the month-to-month decline^,1I

shares

^

>

With many

mines closed for vacations, bituminous coal

duction slid 86%

this week,

ana

was

down 17% from

"The

of
the

mained close to last year.
both the

king."

right

pro¬

year ago.

'■

-

week, it

prior week and the

same

>

1957 period.

re¬

of

'

Paperboard producers, increased output 23%

6%^.

Department store sales
the

Federal

t'r.'

.

Reserve

on a

Board's

%%

■

V

..

ing week, June 28, 1958,

the

weeks ended

period. Jan.

a

the

annual

There

1958 to

year.

was

loss of 3%

a

July 5,

*

\

as

*' •'

was

for

1958,

a

5,

In the preced¬
For the

recorded.

decrease

of

3%

For
was

.

According to Federal Reserve Board's index, department store

City for the weekly period ended July 5, 1958,

increased 11% above that of the like period last
year.

ceding week, Juiie 28, 1958,
four weeks ended

a

July 5, 1958,

was

reported.

For the

1% gain

was

reported.

For the

period Jam 11, 1958 to July 5, 1958,
of the

In the pre¬

gain of 1%
a

a

1% gain occurred from that

corresponding period in 1957.

Philadelphia had the biggest increase

or

18%

July 5 and Dallas the sharpest decrease, off 10%.




in

of stock

week

ended

the floors

to

be

intend

heard

on

to

of

of

the

are

future

the

speak

behalf of

they represent correctly the
thinking of those who ask them to

management of

Westinghouse Air Brake is certainly to be
congratulated on taking the steps
described in their proxy notice:
"In order to make it
nual

be held

1896.

for

con¬

shareholders, the

meeting

burgh

more

of

in

your

an¬

company

downdown Pitts¬

the

first

time

since

The

meeting will be held in
Pittsburgh Room of the Penn-

the

can

new

be
a

from

seen

recent

this

Other members

of your manage¬
we all look

ment will be there and

forward to seeing you at 1:30 p.m.,

Monday, April 21, 1958."

on

William
"I

letter:

ex¬

letter from

the

I

Shine

J.

became

first
had

a

time
some

in

Or

this

from

Vanadium

our

the

President

Corporation,

of

annual meeting of stockhold¬
be held in the Perroquet

Suite of the Waldorf-Astoria Ho¬

tel, 50th Street and Park Avenue,
New York, N. Y."
V
"These

meetings

opportunity
and

the

a

each

affairs

.

The

executives

as

should

not

be

tod

hard

for

presiding

officers to keep them
by the judicious Use of
parliamentary procedure. Where,

in bounds

in

as

some

instances, these indi¬
the limits of pro¬

con¬

Man,' portray
titans
firmly en¬

of-

characteristic
there
to

of

some

them—

readily available
chair for depriving them

are

the

means

forum

a

for

their

exhibi¬

tionism.

;

,

.

of

taken

relations

dislike

the

would

attempt

speak

Since

we

and

trends

new

to

suppress
have not the

intention

of permitting
attempts at it always
end in dramatic scenes which only
any

the independents that
opponents of their views
for

which

lawyer who has

matters.)

Wall Strut Post 121T
Elects Officers

who

secure

a

prominent part in acting
for both management and inde¬
pendent
stockholders
in
proxy
a

.

stockholder

and

be

may

necessary

City

(Mr. Roth is

the

A summary of the

who

it

.a

EUGENE FREDERICK ROTH
New York

for themselves. And what of those

slightest

times

at

part of the corporate form of do¬
ing business.

These samples of good manage¬
ment

which

July 15, 1958.

future

and

...

affair

turbulent but which is

you

fear the most—more

publicity for

objectives

—

the

defense

of

shareholder democracy.
Jackson

vs.

Announcement
made of the

Trust
at

just

been

Officer
Manu-

the

f acturers..
Trust

Co.,

as

Commander of
Wall StreetPost

No.

1217

of the Ameri¬
L

Oliver

ri.
J.:

Troster,

of

can

g i o

e

•

Troster, Singer
Co.

was

elected

Marshall

has

election of James L.

Asst.

Cooke,

&

First

Vice-ComTo

to

those who

hate

it throttled

see

another,
the

it

in

and

one

hope

way

or

merely remind them

we

time

that

Chief

Marshall made

a

cision from the bench

Justice

weak

de¬

of the Su¬

and

Organization

It

to discuss

complacency it is preme Court. That great fighter
encouraging to know that you and for economic and political de¬
in America, President
your colleagues are thinking and mocracy
expressing vigorous opinions. The Andrew Jackson merely retorted
typical books concerning manage¬ "John Marshall has made his de¬
ment, e.g., William H.
Whyte's cision, now let him enforce it."
formity

duly limiting democratic processes.

affairs."

this

huge gaps of
of

for dealing With
destroying or un¬

means

without

for

year

proceedings will be sent to stock¬
shortly after the meet¬
ing. ... A report also will be
given on the corporation's opera¬
tions
and I am looking for¬
ward to discussing questions which
you
have on the corporation's

market, there
ignorance.

era

them

best

holders

stockholder

last
spring.
knowledge of

an

practical

the

are

management

your

company.

of

In

appears to me to

exaggerated. There is
"lunatic fringe" in every demo¬
cratic society and it is hard to find
a

William

to

ers

John

were

article

•

However, the wide open stock¬
C. Kecley:
holders meeting surely is an im¬
"Once again it is my pleasure provement over the old days, and
to extend a cordial invitation to managements simply have to get
you
as
a
stockholder to attend used to the idea of an annual

business operations and the stock

...

19

rather

of";

#

investor:

Said

be

meeting is the only

do

from

And from the Legal Corner

viduals exceed

Sheraton Hotel."

shareholder rights—the inevitable
result
is
simply
ever
growing

so

(Mr. Gilbert is the well-known

"champion" of the public stock¬

June

statement:

"The

their

tract

July 14, 1958.

DEAR MR. MAY:

That
,

While
.

on

LEWIS D. GILBERT %

:

New York City

announce¬

past.

discussion?

meetings

and

for

reported below that of 1957.

sales in New York

Chair¬

those whose proxies they hold in
addition to
their own holdings.

-

taken from

reported.

was

whose shares

you have to say, but I shall defend
to the death your right to say it."

The problem
example, there is this from
of the "pftrfesWestinghouse Airbrake's recent" sional heckler" mentioned in your

criticize,

the

Board, the President

shareholders

compa¬

for, they week ended July

decrease of 4%;

July 5, 1958,

1,

''

country-wide basis

index

1958, increased 1% above the like period last
four

A:'.''

the

commend

he owns."

year-to-year decline of 7% in lumber; production, and shipments

fell

or

The representatives of the small

rable week last year, but new orderswere down 4%.
a

10

other executives of the business

or

*

over

examine,

cross

enterprise

Heating oil supplies

-

by

Exchange.

10,000—can exercise his

or

to

condemn

a

Stock

year,
the stockholder is
At the annual meeting, the

every

Gasoline stocks fell moderately below

continued: to rise seasonally.;.

York

Entitled "Annual Meeting Month"
the article starts "At least once

man

While petroleum output rose fractionally during the

Exchange" published

New

of

For

shareholders of the United States.

change-over period. The total production of passenger cars from
Jan. 1 to July 5 of this year was 34%vless than in the comparable

in¬

hopeless
and
vain
trying to stop what
cannot be stopped, the old
guard
simply should adopt as their own
slogan the famed one of Voltaire:
dreams

priety—as when they become per¬
in
their
time regularly set aside each year sonal
vituperation or
for us to become better acquainted. hysterical
in manner which is

The independents at the annual
meetings smile at these people.
They know what they want and
where
they are going as they

build

week

1957

rights

good part of its backing
management contributions.

from

months, according to the United States De¬
partments of Commerce and Labor.
the

share¬

of

terror

secures

r

terms

"The annual

president of

for the first time in 18

Some plant shutdowns for the Independence

where

the management team and a vice-

28; reflecting; further layoffs in

automotive

industry as a result of shutdowns for the model
changeover process. Although unemployment in mid-June rose to
5.4 million, the highest level since August 1941, the number of
employed advanced, with manufacturing sharing in the increase

rated

old guard of management. Latest
signs of this weeping as cited by
you in the above-mentioned arti¬
cle, comes from a credit man on

The most noticeable decline occurred among

surance

and

Naturally this strikes
more

manufacturers
goods; wholesale stocks slipped fractionally, while those
retailers were unchanged. >
V

the

with

—

management

management

Weeping

manufacturing and trade inventories fell

of durable

of

on

shareholders

conflict.

moderately during May to $87 billion, after adjustment for sea¬
sonal factors, according to the- United States Department of Com¬
merce.

platform the

insist

cor¬

in

ings annually—Ed.)

speech.

management which

in

will

holder

earlier, while purchases of fresh
Trading in rice was sustained at a
.

of

not of the

venient for

over

week

produce- climbed noticeably.
high level, and wholesale inventories continued to dwindle.

ments

right of free

look at several

us

port become increasingly directors
corporations, and pledge them¬

of

independents
rights of the

,

at

Let

selves to support the

-

Food wholesalers reported substantial gains in picnic food
specialties this week, especially cold cuts, baked goods, soft drinks,
and ice cream.
The call for canned goods and frozen foods re¬
mained

pression of free

proxy

passed

dulging

stooges,
customers,
those doing brokerage

or

your

pro-management
respondents that instead of

with the directors does not waste
time trying to buck what

at

worsteds;

and

friends

to

misguided

of

thinking

of

one»

has

of Intelligent
Management

aid

suggest

of:

"I disagree completely with what

Attitude

Intelligent management instead
fighting rear guard actions with

the

prove

comments

holder's rights; on which "cru¬
discussion at the annual
meeting,
the forum provided for the ex-' sade" he attends over 150 meet¬

that company brass has to

year

of

would

we

merely

the

cannot prevent—the

shutdowns for vacations, orders taken by
textile mills fell moderately during the week. Trading
in-woolens,
numerous

If the stock¬

.

So

will

of

New

a

wept

with

up

become

crosses

lightweight suits,

.

validity

pro-

shareholders

meetings

"Putting
has

beachwear, and sportswear.
Reflecting*

an¬

friends in these terms:

this week,

.

an¬

they

independent

annual

some

meetings.

the views

are

York evening paper in
discussing
the conduct of the
managers and
the

actively at

more

plex."

company

wrilfcr

management

Retailers

proper

disorder

the

.

MAY:

meeting
communicated
to
by Messrs, George Meyer and

A little

and

.

holder does not express his views
he will be lost in the giant com¬

Herold, V. P. of the Inves¬
tors' League, following your arti¬
cle on "Heckling The Hecklers."

close to those of the similar events last
year.

were

nual

Paul

the

fans, but bookings in laundry equipment and
Showings in many markets stimulated inter¬
housewares, floor coverings, and draperies, and sales were

in

.

The

you

attendance

MR.

Absolutely absurd
conducting the

refrigerators lagged.
est

Champion's

in¬

your

participates

on

Exchangethis week, and orders matched those
best-sellers were bedroom sets, upholstered chairs,
goods,. There was a noticeable rise in re-orders for air

case

unsound

s\s

(A Communication)
DEAR

year ago;

and

tjs

Corner

New York Furniture

of

*

•

From the

Chicago stores reported

good

to

fiscal policies.

ago most

hurrying a meeting

Jackson.

:

the best results in volume in men's clothing.

[-) Wholesalers

and

wild

housewives

year

the

support

their

trenched in their citadels of power.
In view of this situation

stocked

Sales of women's apparel exceeded

make

a

needed

up on
fresh fruit and vegetables, smoked
meats, soft
drinks, baked goods, and frozen foods. There was little change in
volume in dairy products, fresh meat, and canned goods.

to

owners hav$
opportunity to
legitimate comments
suggestions,
the
resultant

had

still another sector of the
citizenry on the inflation-escalator
and
further reduce the sorely-

year.

week-end

try

close when the

a

not

Observations...
put

sales fell

as

stooges

Chairman in

last year.

week

moderately from both the preceding week and last
In

let

year

Appliance dealers reported a sharp rise in sales of air con¬
ditioners and fans, and volume was close to a
year ago; appreciable
year-to-year declines continued in refrigerators and laundry equip¬
ment. There were substantial
gains from the prior week in pur¬
chases
of barbecue
supplies, garden implements, and outdoor
furniture, but interest in upholstered chairs, draperies, and floor
coverings was unchanged from a week earlier. Retailers blamed
hot

5

page

Overall

of

reduced-price sales promotions, the call
suits, sportswear, and bathing suits fell

lightweight
moderately below the similar

the

from

numerous

men's

for

that of the prior week.

apparel fractionally

Continued

interest in

In

other

words,

Chairmen try to

let

misguided

stifle discussion,

m

n

a

d

e

Olfver h Troster

r.

Others elected

2nd

were:

Vice-Commander

—

Daniel Brown, White Weld & Co.
Vice-Commander—John

3rd

C.

Courtney, Thomson & McKinnon.
Adjutant:
John

J.

Meetings
Hall

Fritz

O'Kane
are

Memorial

&

K.

Johnson,

Co.

held

in

Building

Federal
on

Wall

Street, the second Tuesday of each
month.

32

Continued from page

and

Bank

tional

Deposit

News About Banks and Bankers
Trust

York,

announced

are

by Horace

Chairman

Flanigan,

New

Company,

ufacturers

the

of

and Byrne

Messrs. Buono

Both

bank's cor¬
department at 45

assigned

the

to

trust

porate

Beaver Street.

NEW

COMPANY,

TRUST

CORPORATION

,

YORK
June 23,

'58 lO 31/57
$3,636,156
$3,6/3,637

.

Total resources..--.-

Deposits
Cash

tt'

*

if

THE

497,786

288,607

—

Smith

1,638,602

1,732,619

—

V. S. Govt, security

holdings
Undivided

«

?■

FEDERATION

435,644
417,277

435,653
564,485

------

profits—

o

BANK

TRUST

AND

NEW YORK

COMPANY,

..$146,206,894

Mar. 31/58
$128,190,462

134,103,193

116,633,175

June
resources

..

Deposits

30/58

Trust

State

35,430,164
59,029,446

Loans & discounts

Undivided profitsI'

•

'

will acquire

Marine Realty, Inc.

Building, the
Marine Trust Building including
the recent Administration Build¬
to

Rand

the

addition, and the new Third
Street Building now under con¬
struction at Niagara Falls, N. Y.
These assets will be sold to the
ing

subsidiary at the value at which
they are carried in the bank's
statement.

if

loan

from the

Stephen D. Corriss, former As¬
Secretary, has been ap¬

sistant

Vice-President

Assistant

pointed

Bank,
announced by

Of Chemical Corn Exchange

it

York

New

was

Chairman. Mr.
regional credit officer,
located at the Brooklyn Office of
Harold

Helm,

H.

Corriss is

a

the Bank.

•

the

announced

also

Helm

Mr.

appointment of John G. Riddell In¬
vestment Trust Officer and James

as a

Division.

Investment

1953

In

he

appointed an Assistant Trust
Officer, Personal Trust Depart¬
ment, and in 1957 a Trust Officer,
Mr.

Division.

Welsh

has been with the bank since 1933,
been Assistant Trust Of¬

and has

'
if

Assistant

the

to

hitherto

Treasurer,

was

elected at the July board meeting

Assistant
Trust

of

Treasurer

Company,

American

York,

New

cording to Harvey L.

ac¬

Schwamm,

Chairman.

about five years.

Bank for
if

if

Representative

of

Firstemerica Corp., San Francisco, and
fcis election
ican
was

Trust

president of Amer¬

as

New

Company,

York,

announced July 15 in a joint

statement

by

Firstamerica

Oscar
H. Keller,
President,
and
by

H arvey L. Schwamm, Chairman of
American Trust.
Mr. Smith will
his

assume

new

Smith's

Mr.

office Aug. 15.
previous connec¬

In his last post as Eastern Represen¬
tative of Firstamerica, bank hold¬

ing company-successor to Transamerica, he represented 23 banks
in 11 Western states.

Francis

if

Western

A.

New

nounced the

Presi¬
Company of

Smith,

York,

N.

Y.,

an¬

Assistant Mana¬
New York office, and R. K.

the

bank's

board, is the daughter of the late
Walter Jeffreys Carlin, one of the
founders of the bank and later its
President

and

Chairman.
if

THE MEADOW
OF

if

BROOK

FREEPORT,

NATIONAL

NEW

YORK

June 30/58

>

$

Total

resources.;—_

Deposits

_

BANK

Dec. 31/57
$

362,002,634 337,005.691
329,906,239 306,408,968

Cash and due from
banks

37,384,779

31,688,227

U. S. Govt, security

holdings
fcoans

&

105,546,297
discounts

Undivided profits-.

84,930,123

139,855.219




Com¬

Trust

and
if

sis

Malcolm

retired

Johnston,

Vice-President

Girard

of

has resigned as a
bank's Board of

2,726,430

42

time

that

At

the

after

bank

service.

of

years

continued

he

as

a

Director.

of

Wash.

He has served

In his

1952.

of

of

Seattle,
Assistant

as

bank

the

since

position, he will

new

Abington

Company,

Trust

and

Philadelphia, Pa.,

was

merged into Fidelity-Philadelphia

of the trust

the

Chicago

area.

if

if

if

AMERICAN

of

COMPANY,
SOUTH BEND, IND.
Dec. 31/57

$25,508,145

$26,154,079

23,258,952

resources

23,996,805

Deposits
Cash

and

from

due

:

•

.

banks —7,139,700

holdings
Loans

,

6,184,989

if

si:

8,850,220

Trust

Company

in

June

1957.

Undivided

448,189

314,694

profits...
if

(

if

.

the

trust

Bank

of

former

a

the

First

Na¬

July 8. His age was 83. Mr. Os¬
good, who served the bank forty
years had charge of the trust de¬
partment from 1919 until his re¬
tirement

in

the

of

E.

if

President

Foremen,

Brothers

Foreman

National

State

His age

if

Si:

THE

,-,V"

30.
if

The

common

Fla.,

TRUST

&

Dec. 31/57

June 30/58

$979,167,341 $990,573,107

resources

Deposits

897,379,387

911,629,386

Jd——167,360,792

'

;

capital stock of the
Bank of Dunedin,

increased from $300,000

was

by a , stock dividend
$350,000 to $400,000 by
new
stock, effective

from

the

sale

of

(Number

July 2.

out¬

of shares

standing—16,000 shares, par value

$25.)
if

if

if

of

Bank

National

First

The

367,562,952

316,236,145

&

discounts 328,065,940

337,247,026

Undivided

$5,000,000

from

stock

to

$6,000,000 by the sale of new
stock, effective June 30. (Number
of
shares
outstanding — 600,000
shares, par value $10.)
■

secu¬

holdings.

Loans

'•

if

$350,000

176,586,226

Govt,

rity

•

'

if

National

First

capital

si:

BANK

DETROIT

COMPANY, DETROIT, MICH.

S.

/

,

Miami, Fla., increased its common

69.

Total

if

if

Bank,

Chicago, 111., died July 13.
was

June 30 of this year.

of Eustis, Fla., effective June

pany

and

Banking Company of Chicago, III.,
and Chairman of the Board of the
Foreman

over

were

company

on

The First National Bank of Eus-

to

1946.

former

of Aug. 18.

as

tis, Fla., changed its title to The
First National Bank & Trust Com¬

if

Osgood,

Clifton

Roy

profits.

9,784,202

12,516,180

if

if

if

The

capital stock of the

common

Commercial

Shreveport,

La.,

in

Bank

National

increased

was

from $4,500,000 to

$5,000,000 by a
dividend, effective July 1.
(Number of shares outstanding—

stock

BANK

FIDELITY

been elected

Geoffrey S. Smith, President.

by

AND

TRUST

KENTUCKY

June 30/58

200,000 shares, par value $25.)

Dec. 31/57

sis

Sis

if

SAVINGS

BROOKLINE

BANKING

MASSENA

AND

COMPANY, MASSENA, N. Y.
June 23/58 Dec. 31/57
$12,290,207

$10,603,826

11,371,834

9,778,502

2,067,416

resources.—

1,402,206

Deposits

si:

and

due

from

banks

Govt,

security

holdings
Undivided

3,935,068

127,052

discounts

&

and

4,886,295
950,235

102,043

660,753

28,169,643

—

sis

if

20,203,708

4,675,286
16,871,468

profits—

509,947

419,459

Undivided

THE

East

if

FIFTH-THIRD

June

of

Bank

■

if

UNION

CINCINNATI,

PANY,

National

4,675,103

discounts

&

Loans

TRUST

Setauket,
its

in¬

York

New

capital stock

common

outstanding,
value $25).
❖

The

shares,

8,000

office

of

the

Comptroller
issued a charter
to
the Hampton National Bank,
Hampton, N. H., to open a new
President

bank.

and

is

Cashier

William
is

W.

Charles

K.

The bank has

$100,000 and

a capital of
surplus of $30,000.

a

si!

332,726,957 338,928,235

50,875,959
54,412,748
105,228,310 116,038,844
2,567,933
1,899,828

discounts

if

Fidelity

if

State

Minnesota,

title

to

Fidelity
if

holdings
discounts

&

Undivided

114,285,048
97,386,371
158,256,122 168,444,882

4,603,995

>f

'f

5,368,590

was

a

Trust

and

Okla¬

of Norman,

increased from $200,000

if

National

Bank

of

Little

Rock,

Ark., increased its common capi¬
stock

from

$2,000,000

to $2,-

shares,

into

of

common capi¬
$300,000, has gone
voluntary liquidation by a

stock

of

resolution

of

its

shareholders

dated June

17, effective June 30.
Liquidating agents or commit¬

tee:

Messrs.

Thomas

W.

Offutt,
Chairman; J. Jackson Smith, Sec¬

retary;

J.

Cooper

Graham

and

par

value $20.)
Si:

if

National

Bowling
Ky., with

Green,

Bowling

common

Green,

stock of $100,-

000; and Potter-Matlock Bank and
of Bowling Green,

Trust Company

Bowling

Green,

Ky.,

with

of

ing bank.
Absorbed

tional

Bank

by:
of

Industrial

Na¬

Providence, R.

I.

$200,000, have merged, effec¬
tive as of the opening of business
July 1. The consolidation was ef¬
fected

under

the

charter

of

The

structure

City National
a Houston

Building has been

landmark

since

its completion in

1947.

First

City

National

Bank

became the largest in Houston and

third largest in the South in 1956
when
the
City
National Bank,

Houston, Texas organized in 1924,
consolidated with the First Na¬
tional

of

Resources

Texas,

Houston

Bank,

which opened its doors

the

in 1866.

bank,

as

of

about $75,000,000 over the
proximately $627,000,000 in
sources in June, 1957.
of

if

if

American

ap¬

re¬

if

National

Bank

of

stock

of

verted into

title
tive

$200,000,
Bank

the

and

Tex.,

Houston,

of

as

con¬

was

state bank under the

American

Company,
June

a

close

of

Trust

effec¬

business

30.

com¬

of

Bank

The present First
Bank

ital

The American National Bank of

D. Harrington, care of the mon
stock
of
$100,000,
have
liquidating bank.
merged, effective as of the close
Absorbed by: The First National of business June 30. The consoli¬
Smithfield, glatersville, R. I., with
common capita stock of $100,000,
Bank of Baltimore, Md.
dation
was
effected
under
the
has gone into Voluntary liquida¬
*
if
if
charter of The American National
tion by a resolution of its share¬
Bank of Bowling Green and un¬
The
First
National
Bank' of
holders dated June lC
effective Newport News, Newport
der the title The American Na¬
News,
at close of business June ^0.
Va„ with common stock of $500,- tional Bank and Trust Company
Liquidating agent: Mr. "Earl R. 000; and Warwick National Bank, of Bowling Green.
si:
if
if
Kenyon, Jr., care of the liquidat¬ Warwick, Va., with common stock

First

present

Houston, Houston, Tex., with cap¬

ii

Chas.

The

its

if

tal

Bank

from

street

June 23, 1958, were approximately
stock dividend the Union $702,000,000, reflecting an increase

Towson, Md., with

National

24-

in downtown Houston.

The

250,000, effective June 30. (Num¬
ber of shares outstanding—112,500

Second

sell the

story skyscraper it now occupies
build a new banking house
and
office
building
across
the

if

$300,000, effective July 3, 1958
(Number of shares outstanding,
3,000 shares, par value $100).

tal

if

Bank

to

By

profits

Minneap¬
changed its

Bank,

has

By the sale of new stock, the
common capital stock of The First

if

Loans

-1:

if

National Bank

Texas will

Houston,

Company.

87,831,680

76,393,511

banks
U. S. Govt, security

The

the Currency

$

and due from

Cash

&

homa

Dec. 31/57

367,987,671 372,927.964

resources

Deposits

par

sis

si:

Total

COM¬

OHIO

30/58
$

creased

86,610,702

City National Bank of

and

olis,

—_

Sit

Tinker

The

2,072,726

security

holdings

profits

reserves..—

23,897,354

banks
U. S. Govt,

82,077,209

June 30/57

and due from

Cash

from

due

The First

$27,953,181

2,942,354

Deposits

225,716,475 245,782,979

—

banks

Undivided profits—

$32,801,841

resources

Deposits
Cash and

Loans

June 30/58

Total

247,420,883 267,364,430

resources—

holdings

TRUST

TRUST

AND

Total

U. S. Govt, security

COMPANY, PITTSBURGH, PA.

Loans

of

$17,000,000

9,314,732

COMPANY, LOUISVILLE,

I
if

if

U. S.

new

9,824,158

8,662,118

-

CITIZENS

if

John R. Park, has

joined the Marine to the Board of Directors of Gir¬
Trust Company in December 1957, ard Trust Corn Exchange Bank,
and
Mr.
Hartshorne
joined the Philadelphia, Pa., it is announced

Cash

plan,

will be issued

si:

discounts

&

is

stock certificates
Cap¬
ital, surplus and undivided profits
to the

June 30/58

Total

A meeting
called for

company.

stockholders

the

July 23, and if approval is given

TRUST

Faath

Mr.

Total

following

in

serv¬

Trust Company, Philadelphia, Pa.

THE

Chairman of the Board,
the
meeting
of
the
Board of Directors on July 8.

A. Sibley,

The stock split is subject to the
approval of the bank supervisory
authorities and the stockholders

banks

Bank

cir¬

that,

indicated

board

The

cumstances

ing customers of the bank located

concentrate his activities in

if

Assistant Manager,

as

409,000 shares.

Cash and due from
if

on

every

Zwiener,

V.

Commerce

Vice-President

U.

The

split

for

that the par value

'.-v.-.

New York office, of the
bank's Municipal Securities De¬
partment.

139,188,564

1,953,596

Bank

Kenneth

if

Senior

as

Sales,

Nutter.

Smith, the first
on

Bank

appointment of Harry

Faath, Jr.

lyn, N. Y.

Mrs.

Pennsylvania

Northeastern

if

Treat

serve

of

Bank

Trust Corn Exchange Bank, Phila¬

if

Trust

by

Harold

Roetzer, Treasurer.

Lafayette National Bank of Brook¬
to

National

First

The

be

permitting, the quar¬
terly dividend of the new shares
President, following the monthly would be 65
cents, or an annual
meeting of the Board of Directors. rate of
$2.60 per share on the new
Mr. Harris is the son of Stanley G.
stock, which is equal to $26 per
Harris, Chairman of the bank's
share
on
the
present stock as
Executive Committee.
compared to $22 per share now
Mr. Harris joined the bank in
being paid on that stock.
This
1944 after working for tne National announcement was made by John
made

of

J.

Marine

was

Chicago, 111., died

Directors,
it
is
announced
by
Geoffrey S. Smith, President.
Last January, Mr. Johnston re¬
tired as an active officer of the

Mr.

III. The announcement

cago,

Vice-President

Pa.,

of

Mrs. Marjorie Carlin Smith has
been elected a
Director of the

woman

North¬

of

dent,

was
Har¬

of

Savings Bank, Chi¬

Trust and

ris

Jr.,

U. S. Govt, security

delphia,

*

Harris,

the basis of 10
share held, and
of the stock be
reduced from $100 per share to
$10 per share, and the number of
shares increased from 40,900;,to
bank

shares

•

member

*

News.

tional

J.

Smith, President,
Sanderson and August

L.

First

Newport

Vice-President

a

National will have about

if

subsidiary

new

of

G.

Stanley
elected

pany.

tions included East River National from $150,000 to $175,000 by a
Bank, New York; Bank of Amer¬ stock dividend and from $175,000
ica, N. A., New York; Bank of to $200,000, by sale of new stock
America, N.T.S.A., San Francisco. effective July 9 (number of shares

if

'i >

■

$145,000,000,

proximately

National

Haselbauer,
Vice-Presidents,
John W. Livingston, Vice-Presi¬
dent and Secretary, and Edward

«

James A. Smith's resignation as

Eastern

f

"

the

of

She has been with

personnel.

the

>

addition to resources of ap¬

In

of

Francis A.

are:

Marine

Mrs. Paonessa will be in charge
Of

,

Frank E. Hemelright, President

the tenants.

Hartshorne

Mrs. Marie J. Paonessa,

,.

new

ger,

1954.
.

000.

Scranton will be President of the

aince

sj:

bank from 250,000 to 303,-

new

Bank

Newport

title

the

funds.

which will lease back
properties from its whollysubsidiary, will continue
to operate the buildings as here¬
tofore,
and
there
will be no
change in the relationships with
Officers

National

of

Bank

under

$130,000,000 in deposits and
roughly $13,000,000 in capital

The bank,

W.

'

in the number of shares in.

crease

owned

ficer, Personal Trust Department,
if

will result in an in¬

The merger

and

News

politan Philadelphia
and Pitts¬
burgh.
All eight offices of the merging
institutions will be
maintained.

these

was

Investment

will be the largest bank in
Pennsylvania, exclusive of metro¬

pany

bank.

the

to

Pennsylvania
Trust Com¬

and

Bank

National

G.

joined
Chemical
security analyst,

Riddell

Mr.

Pennsylvania
Na¬
Trust Company,

and

Currency.
The Northeastern

eastern

Metropolitan Life Insur¬
ance Company and with cash real¬
ized on the sale of its capital stock

Albert

W. Welsh, Jr., Trust Officer.
Bank in 1950

of $8,000,000

amount

the

in

869,011

J:'

929,480
if

if

Bank

tional

Arrangements have been made
by Marine Realty, Inc. for financ¬
30,407,233
ing the purchase through a 25 year
52,021.086

secu¬

holdings

Bank, to be known as

new

Realty, Inc., a wholly-owned real
estate subsidiary of The Marine will have combined resources ap¬
Trust Company of Western New proximating $145,000,000. Its head¬
York, for the purpose of acquir¬ quarters will be in Scranton.
The move is subject only to final
ing title to the Bank's larger of¬
approval by the Comptroller of the
fice buildings.

21,448,620

10,197,926

Govt,

S.

The

Northeastern

the

banks

rity

Aug. 1.

Marine

of

formation

the

for

Cash and due from

U.

each of the three cities
to merge their organizations into
one
new
area
bank,
effective

of New York Banking Department

National

First

Pa.,

in

ings

A.

Com¬

received from the

been

Bank,

Company of Ilazleton, Pa., voted
overwhelmingly at separate meet¬

Buffalo, N. Y., that approval

pany,

Na¬

Company

the Wilkes-Barre

Savings

and

First

Trust

and the Markle Banking and Trust

on

Francis

the Marine

of

made

was

President

by

9

title

and due from

banks

Total

July

lias

Board.

are

Announcement

of Man¬

Officers

Trust

Assistant

the

of

Shareholders

16

of Scranton, Pa.,

C.

..''.Thursday, July 17, 1958

The Commercial arid Finaiicidl Chronicle

(22$

The Board of Directors of Trust

By

a

stock dividend the
Bank

National

at

First

Brownsville,

Texas increased its common

capi¬

tal stock from $300,000 to

$400,000,
July
10
(number of
shares outstanding, 80,000 shares,
par value $5).
effective

if

si=

The
First

Board

of

National

if

,

Directors of The
Bank

of

Fort

Company of Georgia, Atlanta; Ga.,

Worth, Texas announce the elec¬
tion of J.
Lee Johnson, Junior

has recommended to its stockhold¬

Chairman of the Board and Chief

ers

that

the

capital stock of the

Executive

Officer, Murray Kyger

Volume

188

President,
ecutive

Number

Frank

5760

The-Commercial pud financial-Chronicle

.

W.

Adams, Ex¬
Vice-President, .and "as

-

Members

the

of

Board

of

Direc¬

R. E. Cox, Junior, S. J. IverThomas M. Ryan, and Frank

tors:

son,

W. Adams, Executive Vice-Presi¬
dent.
'
;
*

FIRST

NATIONAL

LAKE

SALT

CITY,

Deposits

by

$124,723,456

112,112,382

109,532,357

18,540,742

banks
Govt,

S.

Loans

&

Undivided
and

42,634,355

42,246,547

56,144,675

discounts

42,389,021

profits

reserves

3,228,379

v

*

3,002,550

F.

William

in

H.

Now I think

that any C.
would agree that when the

Nicks,

General

Crockett,

mon

National
XNauonai

can

uanK
Bank

nadmo, Calif.,

»an
San

01
of

$700,000 to $800,000, effective June
30.
(Number of shares outstand¬

ing—8,000 shares,

value $100.)

par

Officials of both banks have
nounced

an-

for

arrangements

imrton
mgton, to
to

Bank

of

hnv
buy

Spokane,

transaction

is

Wash.

total

a

reduction

drop, or
billion, is attributable solely

named

to

Mr.

succeed

$12

Mr. Crockett

to

been

the

Montreal

Branch

F

the

Smith

has

been

Royal

Bank

of

Canada,

with headquarters in
Hong Kong.
He was previously
Manager
of
the
bank's
main

branch in Port of Spain, Trinidad.
*

W.

P.

*

sion#

South

the

jrom

page

in

has

put

good

or

evidence
the

near

recession.

I

bore

us

Industrial output, which has

hit
bit

looking for, but
unable to find work. During
periods of prosperity, we usually

represen-

have

no

than

more

labor force idle..

England.

London,

know

from

4%

close

personal

So

much

what

What

The

The Outlook ioi Business

,

for

happening.

of

setback

march of

low
low

nointc
points

nmi
and

enma

some

to

for

press

fax

cut

an

.

been

their

pattern

been

shifting

of

purchases.
Al¬
though total consumer expendi¬
tures
moved ahead
during 1956
and 1957, consumers were allocat¬
ing a smaller share of their ex¬
penditures "to such durable goods
as
autos, refrigerators, washing
machines, and the thousand and
one
appliances which Americans
^ount heavily among their bless¬
ings. In the third quarter of 1957,
consumers were

spending $30 bil¬
at the beginning
1956; yet their expenditures on

lion
of

than

more

durable goods showed no increase
all.
Now, such a pronounced
shift in consumer
at

preference^, if
far

*

it

is

not

a.

j

foreseen

enough

advance, and if its effects

are

in

not

accurately
in
the
incorporated
capital spending plans of manu¬
facturers, must lead to an excess
-1

of

capacity for durable goods.
But

all

new

that

too

remember

this

while

plant and equipment

being built, that is before it
installed
and
turning out
goods, manufacturers were oper¬
ating close to 100% of their ca¬
pacity. Optimism was the order
of the day.
But soon many new
was

was

factories

became

multitude

of

available

new

tools

and

were

a

on

hand to turn out

a larger quantity
products than ever before. Witn
the' increase in capacity, the production rate dropped below 100%.
Many businessmen began to doubt
whether
their
former optimism
was
really justified. As production dropped steadily below ca-

of

pacity, businessmen became convinced that the last thing they
needed was more plant and equipment. Capital appropriations beto contract and

gan

soon

capital

were

sagging, businessmen

is

to reconsider

ventories.

their in-

will be like by the end of the
year,
\ have estimated the amount
by

began

to

which

gross

was

would

have to

the size of

Businessmen

ask themselves whether there

in continuing to order
goods for inventory purposes
while final demand was dropping.

any

sense

The

answer

too

had

to

was

outlays

started

on

downward

a

economy.

At the

same

were

downward

as
the Treasury approached its debt ceiling and had
to cut back slowly on its contracts
1

.i.

for

l

: 4.

-

new

~

orders.

I

(3) Towards the end of 1957, as

i

j

^
.3

...i

ping,

and

housing

as

drop-

expenditures




in

of

a

prices

demand-

but

of

a

however,
billion, and

aging

construction

from

news

dicate

local

ana

an

wage

increases compar-'

able

to
those in manufacturing.
result, costs in general have
gone up. These cost increases havd
been passed on to the.
consumer,
especially
in
those;, industries
where
price competition is not
looked upon with favor.

As

a

In

the

months ahead, the con¬
price index is likely to
move
sideways for a number of
reasons.
First, some of the recent
government rise in food
prices has been due
will rise by to
unusually bad weather condi¬

the

the

industry

sumer

,

encour¬

tions.

Second, the recession is
likely to restrain wage increases

residential

seems to in¬

additional

increase

in

industries

where contracts

are

of

„x

,

^

displaced by improved methods of
"
"
production, can usually be ab¬
sorbed. by the normal growth in

xtnur

rliivlnrf

half

year

later, businessmen

living off the goods already

piled up on their shelves, at an
annual

rate

of

$9

billion.

By

A

These

by December requires 3y2 million
more
jobs than we now have—

goes

2Ve

lectful

million to

ment

,

the

to

>

the

reduce unemploy-

care

4%

level, V2

million

<

.

*

of the growth in the
-

«

,

*

rise in productivity.
have 3% million more jobs

To

were

They

prosperity
ployment return.

and

be

1959

~

full

em-

by December calls for

a

rise

in

gross national product of $22 bili

•

do

Possible

are my

expectations if all
But I would be neg¬

well.
if

I

did

not

describe

a

not think

this goal.

In

we

years

can

achieve

of prosperity,

Robert A. McCurdy
Robert A. McCurdy, member of
the New York Stock Exchange,

danger which lurks in the background. The danger is that con- passed
fidence will suddenly crack, that
1

*

ml

m

businessmen

will

spending

drastically
indicate, that

our

sumers

curtail

more

surveys

Avenue, N. Y. City.

Danger

away on

July 3.

ji_

their

than
con¬

With R. C. O'Donnell
(Special to The Financial Chronicle)

will

begin to hoard cash
DETROIT, Mich.—Raymond C.
balances, and that a cumulative O'Donnell, Jr. is now connected
~-c
...ill
r1
a»r\nmn/>11
j?. r1
process of decline will begin to with R. C. O'Donnell & Company,
set in.
I do not think this will Penobscot Building, members of
t

lion.
I

Arnold Ross Opens

Arnold S. Ross is engaging in a
securities business from offices at
666 Fifth

to take

.

It will

persons.

i
before

It is clear that full employment

]abor force, and another V2 million
to absorb the
labor released by

1

million

the economy.

to meet the new orders for build-

ing up inventories. Now, during
the first quarter of 1958—just a

,

^

billion greater than final demand

were

were

State s.

spending,
about $2

means a rate of joblessness
exceeding 4%.
To
reduce
unemployment
to
only 4% means that we must ab¬

is my view

were

outlays

not

rise

currently expiring. Third, in every
that if our econ¬
$1 billion from this area. Without
recession we have had, prices have
omy
had undergone merely the sorb 2 /'> million persons presently any tax action to stimulate con¬
always lagged behind business ac¬
adjustment in plant and equip- unemployed. But if I stated that sumer
spending, consumer pur¬
tivity. Already, there are signs of
merit spending and the stretching full employment by December de- chases will
probably rise by about some
price concessions, especially
oat
in government and housing pended upon creating 21/2 million
$5 billion by year-end. I base this
in consumer durables, in an en¬
outlays, the present recession more jobs, I would be overlooking increase on an equivalent rise in
deavor to stimulate consumer de¬
would have resulted in
nothing the need for growth, which I disposable personal income stem¬
mand.
more
serious than a brief pause stressed earlier.
ming from (a) increased pay rates
In the long run, it seems to me,
{u our long-term rate of economic
An important fact to remember to the military and post office we must
concern
ourselves with
growth.
I doubt that we would about our
economy is that we can- workers, (b) extension of unem¬
the problem of overcoming all the
have had much of a contraction in not
afford to stand still. The old ployment payment periods,
(c) inflationary biases which
h^ve
business at all.
world saying "to stand still is to continued
pay
increases
under been built into our
\
economic sys¬
retrogress" describes the Ameri¬ existing or new union contracts, tem. But in the
year ahead, our
Singles Out Inventory Drop
can
economy
just perfectly.
So and (d) the effect of rising gov¬ real problem will not be inflation
The new villian, responsible for
does Alice's contention that we ernment expenditures.
but how best to combat the reces¬
two-thirds of the recent drop in
This rise of $8 billion in state
must
run
very
fast to Remain
sion and to restore full employ¬
output, has been inventories. Let where we are.
and local
government, residential ment.
1
me explain what I mean.
Every year we add many hun¬ construction, and consumer ex¬
I believe firmly that we shall
The past three years, but espe¬
dreds of thousands of person to penditures
will
improve inven- have the wisdom to infuse our
cially 1956, were years of inven¬ the labor force.
Unless we can tory-sales
ratios
sufficiently so economy with the incentives of
tory accumulation. When a part absorb these
people by enlarging that businessmen are likely to growth in the years ahead. I be¬
of our total production is destined
the size of the economy, we are slow down the rate at which they
lieve that just a few decades from
not for current use but for inven¬
bound to increase the number of are liquidating inventories.
Re- now, we shall
enjoy a standard
tory accumulation, it means that
unemployed.
Between now and member that if businessmen liqui- of living so high as to seem vi¬
our
economy is producing more
the
end
of the
year,
we
must date their inventories at only a sionary today, just as our present
than is needed on the basis of
create jobs for about half million $4 billion rate, instead of the $9 standard
of
living would have
current
demand.
On
the other people who will be entering the billion rate, we will add $5 billion seemed unattainable a few dechand, when in a period of adjust- ja'00r force.
They will either find to current production, in turn ades past.
ment, a part of current demand is jobs available or
join the ranks stimulating employment, income,
The great need is for us to get
met not by current production but
of the unemployed.
and spending. ! am betting that on with the job of economic
by drawing down previously
What's more, nearly every year business will rely increasingly on
growth—and to do it now.
stored
inventories, current pro- we improve our
productive effi- current production than on their
duction declines by more than the
ciency by something like 2 or 3%. stock of inventories to meet the
drop in actual demand. Thus, in- \Vith all the new
productive fa- fourth quarter demand for goods Form Kohn
Bros., O'Keefe
ventories are a very volatile sec- cilities
now in place,.the producand services.
Kohn Bros., O'Keefe & Co. has
tor of the economy.
When busitivity factor this year is likely to
Instead of the $22 billion rise
H
-fh
nffiPP5!
ion
ness
is booming, when sales are
be especially large.
This means needed to restore full employment
Street New York City
rising, businessmen are prone to that by the end of the
year we by the end of the year, I expect
to engage in a securities business*
run up their inventories.
On the
probably be able to turn out our national output to rise by IP
r1 a,seLumiies Business.
Other hand, when sales are dropthe present volume of gross na¬ only $13 billion.
The rate of un- Gerald Kohn ls a Principal,
ping and the outlook seems dim, tional product with a half million employment will
drop to 6%, re¬
businessmen tend to cut back on fewer
workers.
These workers, ducing unemployment by about a
It

depleting their inventories.

being seriously curtailed,

by December

Remember, full employ¬

not

be cut back.

capital spending plans of business

government

rise

ment

clear: inventories

time as busirealizing that they
had overbuilt their productive fa- their inventories with a vengecilities, the Federal Government ance.
contributed to the slowing down
This is precisely what has hapin business activity. No more inpened to the economy. During tne
opportune time could have been peak quarter of 1957 that is the
selected. Early in 1957, outlays on third quarter, businessmen were
national security began to level accumulating
inventories at an
out.
After the summer, defense annual rate
of $3 billion.
This
expenditures actually headed means production had to be $3
(2)

nessmen

national

result

obtained

business capital spending, so that
there will be no upward effect
product from these two spending forces.

to restore full employment to the

v

course.

year?
idea of what business

an

prices today

steady upward pressure on costs
of production.
In recent years
wage increases have outstripped
our
gains in productivity by a

amount would be just sufficient
to offset the probable decline in

get

the

induced

chases to be up by about $3 bilbon (annual rate). A rise of this

of business at the end of this

oegan

consumer

ing too few goods. Inflation today

business recovery in the immedi¬
ate future.

future?

able to restore full

To

have

of

is due to too large a demand ehas—
large a demand chas¬

*—

consumers

We

excess

means

employment to the economy and
do it soon? What will be the
pace

And Economic Growth

demand.

substantial

be

important

capacity in most basic industries.
one
can say
that the upward

By the end of this year, I ex¬
pect Federal
Government pur-

be

an

overall
a

now

cannot

wide margin. Union contracts have
provided
for
productivity
in¬
rise as rapidly as I had hoped, creases as well as cost of living
This, in turn, will prolong the adjustments.
Employees in the
period of
nerinri nf inventory liquidation, rising service industries^.j'where
and mar the chances of a
strong productivity gains are small, have

Months Ahead

we

in

by

con¬

forces

spending will not

.

Will

the

inflation

even

have

now

lumber, have

their
their

across-the-board
that consumer

our

falling

f;
hak

the

for

No

year, I expect some but not total
recovery. The failure of the Ad-

obser-

are

contained

production
industries as

ministration

As many of you

vation, business profits

16

of

outlook

demonstrated

that

for

paper, oil, and

steel,

serv-

million people are

been

making

basic

rates in such

reces-

slowed!

has

has

vincingly

of

you

the

cession

that

bottom

won't

the rate of decline
Seasonally
adjusted

gross

a

is

at

are

the

seriously concerned
long-term danger of

am

inflation in this country, particu¬
larly
after we have
recovered
from the present
slump. This re¬

with all the statistics which bear
out this statement.
Without doubt,

are

has

Ltd.

ty\merican,

drop

product

likely to get?

There

about

I

about

ices, has fallen nearly 15% during have shown recovery. Carloadings
the past year.
Unemployment now fre UP- The entire construction
stands at 7.2% of the labor force, industry is
showing real strength,
which means that more than five
In the months remaining this

*

O'Neill

elected North American

the

billion

inventories,

hit. much hnrripr
been hit mnrh harder than
than

tatiye Qf the Rank of London and

If

in

squarely in the middle of

elected

Montreal,

V.

$18

national

special Far Eastern representative
of

turnabout

The

Manager.
J.

the

faster than sales.

Continued

we

the

by

approved

been

we

the

the North Western
the Norm western

are

has

Two-

been

What

there

depends
upon,
a
general
confi¬

of

dence.

prices?

How close to full
employment
—that is to this
$22 billion rise—

output since the peak quarter

about

maintenance

Near Bottom

or

there is a net reduction
in output of $12 billion. The im¬
portant point to remember is that

of

Touchie in Toronto.

Seattle-First National Bank, Wash-

At

billion,

last year of $18 billion.
thirds of this $18 billion

talking

end of the year.

in

who

will

by the

was

has

Beri>er-

lncieased from

was

econ¬

we

33

world, it is a possibility < to be
watched very carefully. Even the
modest
recovery
I
have
been

over

have this much
growth in only six
months. In short I do not expect a
return to full
employment

bank's Special Representative
New York from 1946 to
1949,

had

stock dividend, the com¬
capital stock of The Ameri¬
a

P. A.

omy shifts from a +$3 billion in
its inventory accounts to a
—$9

❖

By

not^think

rent production by $9 billion.

of The Bank of Nova Scotia,
a statement released

Arthur
the

secu¬

holdings-

rity

$

been

E

take
August.

Manager. Mr. Touchie had been
Branch Manager in Toronto since
1956.
>
*

22,413,335

Cash and due from
U.

%

(£29)

meeting final demand through gross national product has
the. liquidation
of inventories, rising by about $20 billion
businessmen were depressing cur¬ 12 months.
I do

will

{

according to

BANK,
Dec. 31/57

resources—si28.693.592

National

the Spokane Bank in

Gordon J. Touchie has been ap¬
pointed an Assistant General Man¬

UTAH

June 23/58
Total

Seattle-First
over

ager

*«

#

"

ZIONS

Comptroller of the Currency, the

happen,

but...in

this

uncertain

id

nmnnnv

the Detroit Stock Exchange.

*

34

The Commercial and Financial Chronicle

(230)
«

f.iii i

.

.

Thursday, Julv 17

.

»*.!

* INDICATES

Securities Now in
Acme United Life Insurance

at the rate of three new

by common stockholders
shares for each two shares held

1958.

Price—$6.25 per share to share¬

for subscription

be offered

to

of record June

30,

•

$30,597,600 4Vz% convertible subordinated

for all the outstanding shares
stock of Campana Sales Co.
in exchange

American-Caribbean Oil Co.

of common
,

(N. Y.)

shares of common stock (par 200).
Price—To be supplied by amendment. - Proceeds — To
discharge current liabilities and to drill ten wells. Un¬
derwriters—To be named by amendment.
American

Durox Corp.,

•'

than 85%

of the fair market value

granting of options,

Proceeds—To be added and used

as

a

Feb.

Louis.

American Mutual Investment Co., Inc.
Dec. 17 filed 490,000 shares of
per

capital stock. Price—$10.20
share. Proceeds—For investment in first trust notes,

gecond trust notes and construction loans. Company may

develop shopping centers and build or purchase office
buildings. Office — 900 Woodward Bldg., Washington,
D.

C.

Underwriter

Sheldon

None.

Magazine,
Highland Drive, Silver Spring, Md., is President.
—

Anderson Electric
Dec. 23
common

—To

Underwriter

Shearson, Hammill &
Offering—Expected late in September.

1201

•

of

These

a

association.

Proceeds

—

For

working

members

capital.

of

are

issuable

upon

conversion

redemption of the notes at

a

an

ag¬

Calidyne Co.,

of

record Dec. 16, 1957).
The remaining
100,000 shares are to be sold for the account of the Estate
M. Collings Henderson on the American and To¬
ronto Stock Exchanges. Price—At market.
Proceeds—
To selling stockholders.
Office—Toronto, Canada. Un¬

derwriter—None.

Laboratories, Inc., Metairie

(New Orleans), La.

July 2

filed 600,000 shares of common stock (par 10
cents).. Price—$5 per share. Proceeds—For expansion,
working capital and other corporate purposes. Under¬

Under¬

writer—None.

Fidelity Life Insurance Co.
Feb. 28 filed 258,740 shares of common stock
(par
of which 125,000 shares are to be offered
publicly

Central Cooperatives, Inc.
May 26 (letter of notification) $250,000 promissory notes
consisting of $100,000 principal amount of 4% ,6-year

$1),
and

133,740 shares to employees pursuant to stock purchase
options. Price—To public, $6 per share. Proceeds—For
expansion and other corporate purposes. Office — At¬

notes

and

$150,000 of 5% 9-year notes. Price—At par
(in multiples of $100). Proceeds—To retire notes and

for

Underwriter—None.

working capital. Office—1901 Winter St., Superior,
Underwriter—None.

Wis.

.

.

Bankers Management Corp. (7/28)
10 filed 400,000 shares of common stock

Feb.

Cinemark II

(par 25

Price—$1 per share.
Proceeds—To reduce out¬
standing indebtedness and for working capital. Office—
Houston, Texas. Underwriter
McDonald, Holman &
Co., Inc., New York.
—

Bankers Southern, Inc.
April 14 filed 8,934 shares of
par

($100

purposes.

i

\

stock.

Price—At

share). Proceeds—For general corporate
Underwriter
Bankers Bond Co., Louis¬

per

—

ville, Ky.
★ Bettinger Corp.
June 27 (letter of notification) 75,Q0Q shares of common
stock (par $1). Price — $4
per share.
Proceeds -— For
working capital. Office — Gore St., Waltham, Mass.

Underwriter—None.

★ B-l-F Industries, Inc.
July 9 (letter of notification) 4,756 shares of common
stock (par $10). Price—$45 per share.
Proceeds—To re¬
pay current bank loan.

Office—345 Harris Ave., Provi¬
dence, R. I. Underwriter—Brown, Lisle &
Marshall, Pro¬

vidence, R. I.

.1

.

Billups Eastern Petroleum Co. (7/21-22)
May 29 filed $2,500,000 of 7% debentures due
July 1,
1993, and 650,000 shares of common stock (par
$1) to be
pffered for sale in units, each consisting of $1,000 of
debentures and 20 common shares. Price
$1,000 per
—

unit.

Proceeds—To acquire all of the assets of Orlando
£ueJ Oil Co., Inc., Florida Service Corp., Billups Petro¬
leum Co. of Georgia, Inc., Billups Petroleum Co. of N.

Digitized for Inc., Billups Petroleum
FRASER


Santa Fe, N. M.

C.,

Co. of S. C., Inc., Florida Friend

Underwriter—Watson & Co., Santa Fe,

-;

N. M.

it CGS
common

Productions, Inc.

June 30 (letter of notification) 300,000 shares of common
stock (par 10 cents).
Price—$1 per share. Proceeds—
For working capital. Office — 937 Acequia Madre Rd.,

cents.)

.

Laboratories

;v;t|- '

.

.

.7

_

Inc., Ridgefield, Conn.

Price—At

60,000 shares of common stock (par $1).
To be supplied by amendment. Proceeds — To
short-term bank loans, for construction and work¬
ing capital. Underwriter—Hayden,- Stone & Co., New
York.
7
7
'
—

repay

Ar Coastal Caribbean Oils, Inc.
;
June 30 (letter of
notification) American

voting trust

certificates

cents).
share).
penses;

Central

for 78,397 shares of common stock
(par 10
Price—At the market (estimated at $1.121//2 per
Proceeds—For corporate and administrative ex¬

mineral exploration and acquisition. Office—33
Ave.,Panama City,Panama. Underwriter—None.

Commerce Oil Refining Corp. ■
16 filed $25,000,000 of first
mortgage bonds due
Sept. 1, 1968, $20,000,00 of subordinated debentures due

Dec.

Oct. 1, 1968 and 3,000.000 shares
offered

ip units

f

capital

'-%K

in each of 24
supplied by amend¬

cent)

be

expenditures, exploration
Underwriter—None.

market.

common

stock to be

follows: $l,00o of bonds and 48 shares
of stock and $100 of debentures """d nine shares of stock
Price—To be supplied by amenwoent. Proceeds
To
construct refinery. Underwriter—Lehman
Brothers, New
York
Offering—Indefinite
as

—

--

Consolidated Cuban Petroleum
Corp.
July 1 filed 419,000 outstanding shares of common stock
(par 20 cents). Price—Related to the current market

Underwriter

purposes.

7.V

v

'■'7,7

—

McDonald, Holman* &

77'7-*

.

•

••

;-'7V
7 7'

it Delhi-Taylor Oil Corp., Dallas, Texas

-v

j

15 filed 575,869 depositary units tor the class A
stock of the Houston Corp., to be offered for subscription
by the holders of common stock of Delhi-Taylor of rec¬
ord May 23, 1958.
Each depositary unit Will represent
(a) the beneficial ownership of,/one share of class :A
stock of the Houston Corp. and .(b) an irrevocable option
toJ purchase 8,945/10,OOOths of one
additional share of
class A stock of Houston during a two-year period com¬
mencing on Aug.) 15, 1959, or such earlier date- as rhay
be determined.
Price—To be supplied by amendment.
/ Underwriters—Lehman Brothers and Allen & Co., both
July

-

of New York.

;
"

)

Denver Acceptance Corp.,

Denver, Colo.
May 19 filed 1,000,000 shares of common stock (par $1).
Price—$2 per share. Proceeds—To engage, through one
or more subsidiary companies to be formed or acquired,
in the business of writing life insurance and annuity
policies. - Underwriter—DAC Securities Corp., Denver,
Colo. Statement effective July 3.
•
v
Derson

Mines

June 5 filed

Ltd.

common stock.
Price—$1
share. Proceeds—For new equipment, repayment of
loan, acquisition of properties under option, and other
corporate purposes. Office—Toronto, Canada, and Em¬
porium, Pa. Underwriter—None.

350,000 shares of

per

Diketan

Laboratories, inc.

June 10

(letter of notification) 43,336 shares of common
stock (par $1) to be offered to stockholders on the basis
of one share for each 10 shares held until the close of
June

on

the

ceeds—For

W.

5837

20, 1958.

general

Adams

Price—$1.10

fund

of

the

per

it Diversified

share. Pro¬
Office—

company.

Blvd., Culver City, Calif.

—Lloyd Arnold & Co., Beverly Hills, Calif.

Underwriter
>
.

Industries of Colorado, Inc.

July 9

(letter of notification) 60,000 shares of common
stock (par $1). Price—$5 per share. Proceeds—For home

construction; industrial scaffolding and ladder -division
and working capital.
Office-—1- 3175 South Clarkson,
Englewood, Colo. Underwriter—None. J
\
'
Dixon

Chemical & Research,

Inc.

Dec. 24 filed 165,625 shares of common stock (par $1) to
be offered for subscription by common stockholders at
the

rate

of

Price—To

July 11 filed
Price

7

;

and

company

business

Bankers

Price —To

other corporate purposes.

Co., New York.

•

of A.

the

of

porate

conversion price of $4 per

Campbell Chibougamau Mines Ltd.7
March 10 filed 606,667 shares of capital stock (par $1)
of which 506,667 were issued in connection with the ac¬
quisition of all the assets of Yorcan Exploration Ltd
(latter proposes to distribute said shares ratably to its

Carrtone

"

;

Dayton Aviation Radio & Equipment Corp. (7 18)
May 28 filed 500,000 shares of common stock (par 50
cents). Price—$1 per share. Proceeds—For.general cor¬

Underwriter—None.

stockholders

St.
7

7

Voting Trusts,
7-'7

writer—Herrin Co., Seattle, Wash.

(par $1).
of

were assumed by the
Dec. 31, 1957. The notes are convertible at
time after July 1, 1958, until the maturity or prior

share.

writer—None.

lanta, Ga

shares

Corp.,

526,774 shares for selling stock¬
Proceeds—For exploration
and drilling costs and other corporate purposes. Under¬

loans.

limited partnership, which notes

any

$50) and $1,500,000 of 5% subordinated registered deben¬
ture notes, second series, and $606,000 of 5%
coupon
to

bank

of

company

Inc., Seattle, Wash.
common capital stock (par

offered

payment

vertible subordinated income notes of the

June 30 filed 4,788 shares of

be

dnd

Proceeds—For

holders.

York.

gregate principal amount of $923,500 of 10-year 3% con¬

+ Arizona Color Film Processing Laboratories
July 14 filed 500,000 shares of common stock (par $1).
Price—$2 per share. Proceeds—For land, building and
equipment, and working capital. Office—Scottsdale, Ariz.
Underwriter—None.

To

notes

i

Daybreak Uranium, Inc., Opportunity, Wash.
Jan. 29 Tiled 1,150,774 shares of common stock (par. 10
cents), of whicfi 630,000 shares are to be offered lor ac¬

additional share for each

Calidyne Co., Inc., Winchester, Mass.:
4 filed 230,875 shares of common stock

on

debentures.

instalment

1

_

•

June

July 7, 1958. Price—$14 per share.
Proceeds—To pay off an equivalent portion of the com¬
pany's current bank loans which, at May 15, 1958,
amounted to $8,450,000. Underwriter—None. Statement
effective July 7.

bearer

one

Sales

Research

one-half

(par

companies.

count

Underwriter—Lehman Brothers, New York.

Arden Farms Co.,

Associated Grocers,

of

ment

Los Angeles, Calif.
June 4 filed 172,162 shares of common stock (par $1)
being offered for subscription by holders of outstand¬
ing common stock at the rate of one new share for each

„

stock at the rate of

1

,

11 shares held July 16, 1958; rights to expire on July 30,
1958. Price—$27.50 per share. Proceeds—For the retire¬

Anita Cobre U. S. A., Inc., Phoenix, Ariz.
Sept 30 filed 85,000 shares of common stock. Price—At
par ($3.75 per share). Proceeds—For investment in sub¬
sidiary and working capital. Underwriter—Selected Se¬
curities, Inc., Phoenix, Ariz.

held

New

*•"

''

vv

stock

common

costs and

Burroughs Corp.

common

to

five shares

14,

v.'

filed 550,058 shares of common stock (par $5)
being offered for subscription by holders of outstanding

^orp.

selling stockholders. Office — 700 N. 44tb
Street, Birmingham, Ala. Underwriters — Cruttenden,
Podesta & Co., Chicago, 111.; and Odess, Martin & Herzberg, Inc., Birmingham, Ala.

★

....

.

Counselors

ment.

June 27

(letter of notification) 14,700 shares of class B
slock (par $1). Price—$12 per share. Proceeds

go

Co.,

—

.

—

Cuban

Street, Englewood, Colo.

\..

.•

*7

Robert H. Green is President.

.

Havana, Cuba

Budget Finance Plan, Los Angeles, Calif.
June 10 filed 132,000 shares of 6% serial preferred stock
($10 par). Price—To be supplied by amendment. Pro¬
ceeds—To be used in conjunction with proposed merger
of company and Signature Loan Co., Inc.
Stockholders
of Budget Finance will vote on proposal Aug. 5, 1958.

Office—345 Hudson St., New York

'•

:

March 31 filed 767,838 units of voting trust certificates,
each certificate representing the ownership of one share

Underwriter—None.
i

'.

Cuban-Venezuelan Oil

'

part of the general

funds of the club.
N. Y.

.

Underwriter

plant and establishment of the business at Tampa, Fla.,
including payment of the 'balance due on a plant site.
3385 S. Bannock

Underwriter—I. A. I. Securities Corp.,

'

Research

Fund, Inc., St. Louis,'Mo.
filed 100,000 shares of capital stock, (par one
Priee—At market.
Proceeds—For investment.

5

cent).

share.

per

'*

■

.

Counselors

the date of the

on

but not less than $1.25

:

,

it Book-of-the-Month Club, Inc.
July 9 (letter of notification) 25,000 shares of capital
stock (par $1.25) to be offered to key employees pur¬
suant to a restricted stock option plan. Price—Not less

Englewood, Colo.

Proceeds—To

Exchange.

and 200,000 shares of common stock (par $5).
Price—At par. Proceeds—To he added to working cap¬
ital. Office—Ithaca, N. Y. Underwriter—None.

Feb. 28 filed 500,000

May 1 filed 2,500,000 shares of common stock (par $1).
Price—$2 per share. Proceeds—For construction of new

Stock

$100)

July 15; rights expire on July 29. Proceeds—To pay
$115,000,000 of bank loans outstanding at June 16, 1958,
with the balance, together with retained earnings, to be
used for work in process inventories and receivables.
Price—At par (flat). Underwriters—Harriman Ripley &
Co., Inc., and Blyth & Co., Inc., both of New York.

offered

American

Cooperative Grange League Federation
Exchange, Inc.
vj
20 filed $400,000 of 4% r subordinated
debentures,
10,000 shares of 4% cumulative preferred stock (par

on

Allied Laboratories, Inc.

June 6 filed 65,000 shares of common stock to be

the

ISSUE

June

debentures due July 1, 1980, being offered to stockhold¬
ers for subscription at the rate of $100 principal amount
of debentures for every 23 shares of capital stock held

Underwriter—None.

on

REVISED

selling stockholders._ Underwriter—None.

Boeing Airplane Co.

June 25 filed

holders, and $7.50 for any unsubscribed shares. Pro¬
ceeds—For working capital and general corporate pur¬
poses.

price

,

PREVIOUS

ITEMS

d

Co., Inc
and Your Friend Oil Co., Inc.
Office—
Jacksonville, Fla.
Underwriter — The Johnson, Lane,
Space Corp., Savannah, Ga.

(par $1)

ADDITIONS

SINCE

Registration

Oil

Co., Atlanta, Ga.

315,000 shares of common stock

June 30 filed

1953

V

.

expansion
Clifton,

one

for

each

four

shares

held.

supplied by amendment. Proceeds—For
and general corporate purposes.
Office —

N.

New York.
may

share

new

be

Underwriter—P W
Brooks & Co., Inc.,
Offering—Indefinitely postponed. Statement

J.

be withdrawn;

Other financing may be arranged.

El Paso Electric Co.

(7/22)

-

•

•

June 25 filed $6,500,000 of first mortgage bonds due 1988,
and $3,000,000 of debentures due July 1, 1978,' Proceeds
refund all of the outstanding 4%% first mort¬
gage bonds due 1987, in the amount of $6,500,006 in¬
cluding the payment of duplicate interest of approxi¬
mately $25,700 and a redemption premium of $351*000,
,to pay off outstanding bank loans, the proceeds of which
—To

were

used

for construction

purposes.

be determined by competitive

Underwriter-^-To

bidding. Probable bidders:

JIalsey, Stuart & Co. Inc.; Kidder, Peabody & Co., White,
Weld & Co. and Shields & Co. (jointly); Equitable.Se¬
curities Corp. and R, W. Pressprich & Co.
(jointly). Bids
—To

be

received

90 Broad St., 19th
■

Ethodont

Feb.
At

20

par

up

11

a.m.

(EDT)

on

July 22 at

5

Laboratories, Berkeley, Calif.

filed 300,000

($5

to

Floor, New York City.
shares of

common

stock.

-

Price—

per share).
Proceeds—To cover operating
during the development period of the corpora¬
tion. Underwriter—None.
expense

Volume

188

The Commercial and Financial Chronicle

Number 5760

(231)
Evergreen-.Gas & Oil Co.^
June 2 (letteirof

notification) 1,500,008 shares of common
stock (par five cents).- Price—15 cents per share. Pro¬
ceeds—For working capital.
Office—E.i12707 Valleyway, Opportunity, Spokane, Wash. Underwriter—Pennar

luna & Co.,

]

Spokane, Wash.

Federal Commercial

~

^

General Aniline A Film
Csrp., New York
Jan. 14, 1957 filed 426,988 shares of common A
stock (no
par) and 1,537,500 shares of common B stock (par $1)
Proceeds—To the Attorney General of the United States

Underwriter—To be determined by competitive
bidding
Probable bidders: Blyth & Co.,
Inc., and The First Bos¬
ton

Corp.

/*

V

^

May 21 (letter of notification) 300,000 shares of common
(par 1(1 cents). Price—50 cents per share. Pro¬
ceeds—To make loans, etc.
Office — 80 Wall St, New
York, N. Y. Underwriter—Dumont Securities Corp., New
York, N. Y.
,
:
stock

_

(jointly):
Kuhn, Loeb & Co.; Lehman
Brothers, and Glore, Forgan & Co. (jointly). Bids—Had
been scheduled to be received
up to 3:45 pjn.

(EDT) on
May 13 at Room 654, 101 Indiana Ave., N. W., Washing¬
ton 25, D. C., but bidding has been
postponed.
General

March 7 filed 450,000 shares of

stockholders

stock

common

Devices, Inc., Princeton, N. J.
(letter of notification) 40,000 shares of com¬
stock (par $1) to be offered for
subscription by

March 31
mon

Fidelity Bankers Life Insurance Corp.

;

Corp.

(par $1)

at

for each 100

the rate of
approximately 18.5 shares
shares held about April
15; unsubscribed

to be offered for subscription by holders of outstanding
stock on a pro rata basis; thereafter the balance remain¬

shares to public.

ing, if

—None.

any, will be offered to the public. Price—$5 per
share to stockholders; and to the public at a price to be

determined.

Proceeds

First

April

Backers

7

months

filed
after

For

—

and other *»orUnderwriter—

expansion

Office—Richmond, Va.

porate purposes.
None.

Co.,

Inc., Clifton, N. J.

$1,000,000
date

of

12%

of

issue

payable nine
units of $100 or in mul¬

in

notes,

thereof.

Price—100% of principal amount. Pro¬
ceeds—To be used solely for purchase of notes and other
tiples

indebtedness

In

issued

improvements

for

payment

on

homes and secured by mortgages or other liens upon the

improved properties.

Underwriter—None.

26

cents).

filed

470,000

shares

I

of

stock

common

Transistor Corp.

(7/21-25)

Underwriter—Hayden,

Stone &

Co., New York.

Georgia Casualty A Surety Co., Atlanta, Ga.
May 6 filed 450,000 shares of common stock (par $1)
Price—$6 per share. Proceeds
For general corporate
—■

Underwriter—Buckley Enterprises, Inc.

Glassheat Corp.
is

(pai

Price—$3 per share.

Proceeds—For exploration
work
and
working capital.
Office — Portland, Ore
Underwriter—To be named by amendment. Sol Gold
berg is President.

Feb.

12

(letter of notification) 150,000 shares of class a
stock (par 10 cents). Price—$2
per share. Preseeds—For general corporate
purposes.
Office—1 E
15th Street, New York 16, N. Y.
Underwriter—Jamei
Anthony Securities Corp., 37 Wall St., New York 5, N. v.
:ommon

w

Forest

March

General

June 27 filed 100,000 shares of common stock
(par 25c),
of which 26,112 shares are for account
of company and
73,888 shares for selling stockholders. Price—To be re¬
lated to the then current market for the
stock on the
American Stock Exchange.
Proceeds—To company for
expansion and working capital.

purposes.

Fluorspar Corp. of America

,

Dec.

Price—$3.50 per share. Proceeds—For
expansion, equipment and working capital. Underwriter

Laboratories, Inc.

26

Grand Union Co.

filed

capital stock (par 10
Proceeds—For sales pro
motion of company's products,
working capital, addi¬
tional inventory and accounts receivable, for research
and development and for other general corporate pur

1978, being offered to common shareholders in the ratio
of $100 debentures for each 23 shares of stock held on

Office—Brooklyn, N< Y. Underwriters—Statement

Pro¬

150,000 shares
Price—$2.50 per share.

cents).

poses.

to

be

•

amended.

Fort

of

,

Pierce

Port &

Terminal Co.

of

$1,425,248,- and

the

balance

will

be

added

to

working capital. Office—Fort Pierce, Fla. Underwriter
—Atwill & Go., Inc., of Miami Beach, Fla., on a best
efforts basis.

N;. \

•

.

July 1.

Rights to expire

on

July 21.

convertible into common stock until

debentures/due

Debentures to be

July 15, 1968.

ceeds—To be used in part to retire all
outstanding shortterm bank borrowings,
including those incurred in con¬
nection with the

May 23 filed 2,138,500 shares of common stock (par $1).
Price—To
be supplied
by-amendment.
Proceeds—To
pay some $174,000 of outstanding indebtedness and to
complete phase one of the port development plan, at a
eost

Tune 12 filed 10,450,000 of subordinated

recent

acquisitions of the 41

"Empire

Stores" and 7 "Mohican

Stores," the aggregate purchase
price being approximately $8,000,000, to replenish cash
expended in these acquisitions, and to pay the unpaid
balance of the purchase price.
The remainder will be
added to the company's general funds and will be avail¬
able for working capital and installation of fixtures for
new stores.
Underwriter
Morgan Stanley & Co. and
W. E. Hutton & Co., both of New York.
—

NEW ISSUE CALENDAR
July 17
Electric

Tampa
-

July 30

(Thursday)

Co.

(Bids 11

Witco

1

July 18

(Friday)

Chemical

(McDonald,

Artists

Holman &

Co.)

Co., Inc.—

July

$500,000

Corp.__

CGS

Common

31

Laboratories

(Monday)

(Offering

Lane,

$2,500,000

General Transistor Corp

(July 22
El Paso Electric Co
,

•

100,000 shares

'

I

Bids 11

•<

(Bids

:_2—Debentures

^

EDT)

Co

^

;

Power

(Bids 10

a.m.

-

Bonds

—.

CDST>

$9,000,000

August 13

..-Common

(KidderVeabody & Co.; Blyth & Con ine.; Whit&

(Bids

&

$20,000,000

Washington Water Power Co

Bonds

;

(Kidder, Peabedy & Co., Inc.; Blyth & Co., Inc.; White, Weld &

to

be Invited)

Debentures

$45,000,000

■

Norfolk & Western Ry.
......

(Bids

to

Equip. Trust Ctfs.

be

Co., and- Laurence M. Marks & Co.) $15,000,000

Invited)

$2,340,000

Public Service Electric & Gas
(Bids

11

a.m.

-

July 24
Ida hof Po w er Co.
/' - (Blyth &

(Thursday)

;

Montrose

'1 ..Common

(Rassco

Co.f Inc.' 350,000 Shares

Chemical

(Varv Alstyne,

SToel

&

Co.)

277,320

shares

\

(Bids to

-•

.

,

and

Halsey,; Stuart & Co. Inc.;

$35,000,000

,i

(Dillon,

Read

&

Co.,

Inc.)

J.

A.

be invited)

&

(Bids to b« invited)

September 23

—Preferred
Co.;

Consumers

$700,000

(Monday)

Management Co.

Consumers

:—Common

(McDonald-,- Fohnan & Co., Inc.) $400,000
.

July 29

Houston Corp.
July 3 filed $36,188,000 of subordinated debentures due
Aug. 1, 1968, and 1,809,400 shares of common stock
(par
$1) to be offered in units of $100 principal amount of

debentures and five shares of stock. Price—To be
sup¬
plied by amendment. Proceeds — Together with other

funds, will be used to purchase the
stock of Coastal Transmission
mon

of

be

$40,000,000

Power

Bonds
invited)

$25,000,000

Co

Preferred

(Bids, to be invited; $25,000,000

Bell

Telephone Co.,

Debentures

(Bids to be invited) $110,000,000

(Offering tto* stockholders^—nndervrrttten.'-by'-Q, Hv WaMsen t C®
Kidder, PeahocJy-<te Co. and Stone & Webster Securities Corp.).
'36./t06 shares
v
,

October 21

Oil

and

com¬

Corp., and 80%

Jacksonville

Gas Corp. common stock, and the bal¬
ance will be added to
working capital and used for gen¬
eral corporate purposes.
Underwriters
Blyth &

Co.,
Inc., Lehman Brothers and Allen & Co., all of New
York, and Scharff & Jones, Inc., of New Orleans, La.
—

Houston Corp,
July 3 filed 818,333 shares of

common stock and 575,869
shares of class A stock to be offered to holders of out¬

standing common,
share of

common

on the basis
stock held and

of

1.51

times

for

each

approximately 1.5 shares
381,273 class A share held. (The

of class A stock for each

right to subscribe with respect to 133,858 outstanding
class A shares has been waived.)
Furthermore* $511,500
of debentures and an unspecified amount of
common
shares (to be supplied by
amendment) will be issued in
connection with the acquisition of
outstanding common
stock of Jacksonville Gas

Corp.

Hussman

Refrigerator Co., St. Louis* Mo.
June 27 filed 31,584 sharps of common stock
(par $5) to
be offered in exchange for the issued and
outstanding
shares of common stock (par $5) of
Dura-Consolidated,
Inc., and for the shares of Duro common which may be
conversion of Duro's $200,000 subordinated
debentures, series of 1956.

•

Idaho Power Co. (7/24)
July 3 filed 350,000 shares of common stock (par 10).
be supplied by amendment.
Proceeds—For
partial payment of short-term bank loans heretofore

Price—To

financing of construction of new oper¬
Underwriter
Blyth & Co., Inc., San
—

Francisco and New York.
Industro Transistor Corp. (N.«Y.)
28 filed 150,000 shares of common stock
(par 10
cents). Price—To be related to the market price. ProFeb.

seeds—For working capital and to enlarge research and
development department. Underwriter — S. D. Fuller &

Co.

York.

Offering—Being held in abeyance.
Insured Accounts Fund, Inc., Boston, Mass.
...

oiieuea oi common

tuuu

share.

per

stock.

Proceeds—For investment.

,

Price—$5,000

Business—To in¬

primarily in share accounts insured by the Federal
Savings and Loan Insurance Corp., in savings and loan
■ssociations throughout the country. Underwriter—None.
Ben H. Hazen is President.

Opportunity Life Insurance Co.

June 2 filed 5,000,000 shares of common stock

(par $1).
share. Proceeds—For working capital and
Office—Denver, Colo. Under¬
writer—Columbine Securities Corp., Denver, Colo.

Price—$5

per

•

Jetronic Industries, Inc.
May 27 filed 130,000 shares of common stock (par 10
cents). Price—$3.75 per share. Proceeds—For research
and development and for
working capital. Office—Phila¬
delphia, Pa. Underwriter — Charles Plohn & Co., and
a

Burnside

best efforts basis.

&

Co., Inc., both of New

York,

Offering—Expected today (July

17).

1983.

18

filed $10,000,000 of first
mortgage bonds due
Proceeds—To refund 4%% first mortgage bonds
Underwriter—To be determined by competi¬

due 1982.

tive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; The First Boston Corp.; Blyth & Co., Inc.; Lehman
Brothers, Merrill Lynch, Pierce, Fenner & Smith and
Reinholdt & Gardner (jointly); Eastman Dillon, Union
Securities & Co.; Stone & Webster Securities Corp. Bids
—Had been expected to be received
up to 11 ajn. (EDT)
on July 8, but
offering has been postponed indefinitely.

Lancaster Chemical Corp.
May 26 (letter of notification) 122,115 shares of
(par $1) to be offered for subscription by

stock

(Tuesday)

Cincinnati & Suburban Bell Telephone Co.,-Debs.
(Bids to be received) $25,006,000

common

Laclede Gas Co.

(Tuesday)

Co

to

notes

Corp., the notes and

stock of Houston Texas Gas &

June

-September 30 (Tuesday)

Michigan.Gas Utilities Co.--'*——i_____—Common




Power

Southwestern

(Tuesday)

'

Bonds

$50,000,000

New England Telephone & Telegraph Co.—Debens.

(Bide

Hegle

July

iU

fice—710 South Fourth St., Las
Vegas, Nev. Underwriter
—None.

Mortimer B.

August 26 (Tuesday)

V
Bankers

Houston

Chemical Manufacturing Co.
May 26 (letter of notification) 300,000 shares of common
stock.
Price—At
par
($1 per share).
Proceeds—For
supplies, advertising, furniture and working capital. Of¬

on

(Monday)

$15,000,000

San Diege- Imperial Corp.,

'j: j.

Debentures

...

Natural Gas Pipeline Co. of America--—Preferred
...

Bonds

$1,000,000

Southern California Edison Co

,

Natural Gas Pipeline Co. of America—Debentures
(Dillon,-Reach &: Co., Inc.,

Co

$60,000,000

Israel Corp.;

August 25

—Common

Co._

EDT;

Rassco Financial Corp

'*

V. t

Hoagland & Dodge Drilling Co., Inc.
June 12 filed 27,000 shares of
capital stock. Price—$10
per share.
Proceeds—To be used in part for the ex¬
ploration of mines and development and operation of
mines and in payment of indebtedness.
Office—Tucson,
Ariz. Underwriter—None.

other corporate purposes.

'

\

stock (par

International

(Wednesday)

August 20 (Wednesday)

Co.. and Laurence M. Marks & Co.) 200,000 snares

r.

Bonds
EDT)

noon

Consolidated Natural Gas Co

Washington, Water Power Co..
.

notification) 199,900 shares of com¬
five cents). Price—$1.50 per share. Pro¬
development of oil and gas properties. Office
—24181 Effingham
Blvd., Euclid 17, Ohio. Underwriter
—Herbert Perry & Co., Inc., New
York, N. Y. Offering
—Expected today (July 17).
mon

ceeds—For

vest

(Tuesday)

Co

(Bids

'

Haratine Gas & Oil Co., Inc.
June 23 (letter of

Maj
Bonds

August 12
Montana

to be sold at 25 cents
per

incorporators*

writer—None.

$2,100,000

(Monday)

(Bids ntoon EDT) $20,000,000

$6,500,000

J

Equip. Trust Ctfs.

Utah Power & Light Co

July 23 (Wednesday)
Otter Tail Power

Shearson,

106,156 shares

CDT)

noon

by

(Tuesday)

August 11

$3,000,000

Bonds

a.m.

underwritten

Minneapolis & St. Lpuis Ry

,

Paso Electric Co.__
^

August 5

(Tuesday)

(Bids 11 a.m.; EDT;

;

>.

Common

(Harden, Stone & Co.)

Common

Hammill & Co.)

Com. & Debs.

Space Corp.)

60,000 shares

Co
be

are

organizers,

directors.

ating facilities.
Common

to stockholders—to

.

Billups Eastern Petroleum Co

V

to

management,
Price—$10 per share. Proceeds—For
working capital and general corporate purposes. Under¬
and/or

made for interim

(Thursday)

Inc

Ludlow Typograph

(The Johnson,

Common
Sachs & Co.) 200,000 shares

(Hayden, Stone & Co.)

(P. Eberstaat & Co.) 300,000 shares

July 21

Preferred

EDT; 30,000 shares

a.m.

(Smith Barney & Co. and Goldman,

Dayton Aviation Radio & Equipment Corp.—Com.

El

ercise of warrants which
warrant

convertible

(Wednesday)

Missouri Public Service Co.

Bonds

Bids 11 a.m. EDT; $25,000,000

y-'.

United

Guardian

Insurance Corp., Baltimore* ML
Aug. 16, 1957, filed 300,000 shares of common stock, of
which 200,000 shares are to be
publicly offered and the
remaining 100,000 shares reserved for issuance upon ex¬

issued upon

v

35

stockholders at the rate of

one

new

common
common

share for each two

Continued

on

page

36

36

The Commercial and Financial Chronicle

(232)

chares held, with additional

subscription privileges sub¬

Laughlin Alloy Steel Co., Inc., Las Vegas, Nev.
June 13 filed $500,000 of 6% unsecured convertible de¬
bentures due June 30, 1968 and 150,000 shares of common
stock (par 10 cents). These securities are to be offered
in
30

5,000 units, each consisting of $100 of debentures and
common shares.
Price—$100 per unit. Proceeds—To¬

gether with the $175,000 mortgage loan of the American
Shoe Co., will be used to meet expenditures in

Brake

acquiring latter company's South San Francisco foundry
■and for working capital, Underwriter—Sam Watson Co.,
Inc., Little Rock. Ark,
Life

Insurance

1 filed 100,000 shares of common stock (no par).
The stock will be offered only to bona fide residents
of Montana. Price—To be related to the current market

July

ject to allotment. Record date: June 9. 1958: rights expire
July 11, 1958. Price — $1.50 per share. Proceeds—
To repay outstanding debts to purchase real property
and for "working capital.
Office — Broad and 13th St.,
Carlstadt, N. J. Underwriter—None. '

Securities

Corp.

March 28 filed 1,000,000 shares of capital stock (par $1).
Price—$5 per share. Proceeds—To acquire stock control

other in¬

companies and related companies and then to
operate such companies as subsidiaries." Underwriter—
First Maine Corp.. Portland. Me.
surance

Longren Aircraft Co.,

Paradox

stock (par 40

in exchange for oil and gas properties and

ceeds—To
selling stockholders.
Underwriter—Market
Securities, Inc., Salt Lake City, Utah. Statement effec¬

Picture Investors Inc.
July 11 filed 200,000 shares of common stock (par $1),
i>rjce—$10.75 per share. Proceeds—For investment. Of¬
fice—Kansas City. Mo. Underwriter—None.

tive Ji,r>e

Price—At

(N. Y.) units of undivided interests in
Municipal Investment Trust Fund, Series A. Price—At
market. Proceeds—For investment. Sponsor—Ira Haupt

Proceeds—For mining expenses. Underwriter
—Birkenmayer & Co., Denver, Colo.

Reeves

&

Blvd.,

Torrance, Calif. Underwriter—Daniel
Co., Beverly Hills, Calif.

ic Ludlow Typograph Co., Chicago, III. (7/31)
July 11 filed 106,156 shares of common stock (par $10)
to be offered for subscription by common stockholders
of record about July 31. 1958, on the basis of one new
.share for each two shares held; rights to expire on Aug.
14, 1958. Price—To.be supplied by amendment. Proceeds
—For working capital. Business—Composing room equip¬
ment and printing machinery and equipment.
Under¬
writer— Shearson, Hammill & Co., New York.
•

Magna Investment & Development Corp.
1
May 26 filed 56.000 shares of common stock and $500,000
of 6%

convertible debentures.

Price—For debentures, at

(in $1,000 units): and for

par

stock, $4.50 per

common

share.

Proceeds—For contractual obligations, for work¬
ing capital, and other general corporate purposes. Busi¬
ness — To engage
primarily in the development and

-operation of various properties, including shopping cen¬
ters.
Office—Salt Lake City, Utah. Underwriter—J. A.
Hogle & Co., Salt Lake City, Utah.
Statement to be
amended. Offering—Expected in latter
part of August.
Martin

Co.,

Baltimore, Md.
sinking fund debentures, due
Proceeds
Working capital and general

June 11 filed $25,000,000 of

July 1. 1978.

—

corporate purposes.

Price—To

be

supplied bv amend¬
Underwriter—Smith, Barney & Co., N. Y. Offer¬
ing, which was expected on July 2, has been postponed.
Issue to remain in registration.
ment.

May 16

&

24

(letter

of

stock

shares

of

6%

preferred stock

of

5,000

(par $50) and 5,000 shares
(par $1) to be offered in units of one

preferred and

—$60
4383

per

unit.

Bandini

one

share of

stock.

common

Price

Proceeds—For working capital. Office—

Blvd., Los Angeles, Calif.

Underwriter—

None.

*r Michigan Cas Utilities Co. (7 29)
-July 9 filed 36.408 shares of common stock (par
$5)
to be offered for
subscription by common stockholders of
■record July
28, 1958, on the basis of one new share for
each 10 shares

held: rights to expire

on

Aug. 14.

Price—

To be supplied by amendment.
Proceeds—Together with
ether funds, will be used for
repayment of bank loans
and lor construction
purposes. Underwriter—G. H. Walk¬

s'

i°-'? <*St- Louis, Mo. and New York and Kidder,
xr" and Stone & Webster Securities Corp.,

u

^eiu0<^Tvr
tooth of New

York.

14 filed 725,000 shares of

zyr:5®

National Gypsum

•

common

stock

(par $1).

^ P^1'. share. Proceeds—For

Missouri Public Service Co.

(7

V

30)

cumulative preferred stock
iJ
Pnc®—To be supplied by amendment. Proickp
J?
?ank loans incurred for construction in
tlnder^lt-®
+wU1 .be added to ^eral funds.
pf, K ?i bidders:
determrned by competitive bidding.
Probabie
Kidder, Peabody & Co.:

tvi/Sl ?11' L?eb & CoExpected to be received
up

The First Bos-

Blyth & Co., Inc. Bids—

to 11

a.m.

(EDT)

on

Julv 30.

Modern

Community Oevelopers,' Inc.,
Princeton, N. J.
'

Montana Power Co.

Underwriter—None.
(8/12)

July 1 filed $20,000,000 of first mortgage bonds
repa>

—

due 1988.

Together with other funds, to be

$lo,500,000 in bank loans

companys

construction

program

and

to

through

used

to

the

carry

on

1959".

Under-

be determined
by competitive bidding. Probb*dders: Halsey, Stuart & Co.
Inc.: Lehman Bros.:

Merrill

Lynch.

Pierce, Fenner & Smith, and Stone &
Corp. (jointly); White, Weld & Co.:
Dillon, Union Securities & Co.: Kidder Pea-

Webster Securities
Eastman

Co,

5*^2™

Rock-Ola Mfg. Corp. Warrants expire 20 days
Price—$4.25 per share. Proceeds
—For working capital. Office—800 N. Kedzie Ave., Chi¬
chased by

from date of issuance.

y

shares

of

common

stock

to

be

no

event less than 81%

of the American Encaustic

—

Natural

Gas

Pipeline Co. of America

Natural

Gas

Pipeline Co. of America

(7/24)

248,000 shares of class B-non-voting stock to be offered
in units consisting of one class A and four class B
shares.
Price — $75 per unit.
Proceeds — For working

and for development of district offices in the
the company is currently licensed to do
business.
Office—Jackson, Tenn.
Underwriter—None.

capital
states

(7/24)

Smith, Barney & Co. and Blyth
— Expected to be received

®*ds

(EDT> on Aug. 12.




& Co., Inc.
up

to noon

B.

where

President

is

July 3 filed 150,000 shares of cumulative preferred stock

R.

Price—To be supplied by amendment. Pro¬
ceeds
To repay bank loans and for working capital.
Underwriter—Dillon, Read & Co. Inc., New York.

Statement effective June

(par $100).

of

one

common

common

filed

59,532

of

at the rate of one new

of

stock

holders

Proceeds—For

unsubscribed shares to be offered to
and to others. Price—$8 per share.
capital.
Office—27 Chenango

working

St., Binghamton, N. Y.

Underwriter—None.

Potomac Plastic Co.

(letter of notification) $57,500 of 6% subordi¬
class A

March 31

common

nated convertible debentures and 57,500 shares of

stockholders at the ratio

common

share held;

each

common

stock

(par one cent)

500 shares of stock and $500 of
per
ital.

Service Co.

shares

(letter of notification) 30,250 shares of com¬
(par $5) to be offered for subscription by
stockholders at the rate of one new share for

debenture

share). Proceeds—To pay off obligations and for
telephone plant construction. Underwriter—None.
6

Canada

stock

mon

per

Public

Chairman.

Policy Advancing Corp.

share for each six shares held. Price—At par ($1

Northwestern

Board

March 25

Carolina

stock to be offered to

and

27.

filed 200,000 shares of capital stock (par $1).
Price—To be supplied by amendment.
Proceeds—For
working capital. Underwriter—Doolittle & Co., Buffalo,
N. Y., and Davidson Securities Ltd., Toronto, Canada.

Nichols, Inc., Exeter, N. H.
May 13 (letter of notification) 11,111 shares of common
stock
(no par). Price—$27 per share. Proceeds—For
expansion and working capital. Underwriter—None.
June 19

Jr.,

11

July

May 5 (letter of notification) 150,000 shares of common
stock (par one cent). Price—$2 per share. Proceeds—To
pay loan; to acquire fishing tools for leasing; and for
working capital. Office—931 San Jacinto Bldg., Houston,
Tex. Underwriter—T. J. Campbell Investment Co., Inc.,
Houston, Tex.

Telephone Co.
(letter of notification) 207,143 shares of

Smith,

Peruvian Oils & Minerals Ltd., Toronto,

—

North

'

/

Peoples Protective Life Insurance Co.
March 27 filed 310,000 shares of common stock (par $1),
consisting of 62.000 shares of class A-voting stock and
•

com¬

July 3 filed $35,000,000 of debentures due July 1, 1978.
Price—To
be
supplied by amendment.
Proceeds—To
repay bank loans. Underwriters—Dillon, Read & Co. Inc.,
and Halsey, Stuart & Co. Inc., both of New York.
•

Underwriter—None.

D. C.

mon.
•

Underwriter—None.

Peoples Life Insurance Co.
July 1 filed 41,823 shares of the company's outstanding
common stock
(par $5). Price—$42.25 per share. Pro¬
ceeds
To selling stockholders. Office — Washington,

right, at its election, to accept less than 90% but in

the

51, 111.

cago

all but not less than 90% of the
outstanding shares of common stock of American En¬
caustic Tiling Co. Inc., in the ratio of one share of
National Gypsum common for each 2-4/10ths of Amer¬
ican Encaustic common.
National Gypsum shall have

to be offered in units of
debentures. Price—$1,000

Proceeds—For equipment and working cap¬

unit.

Office—1550 Rockville Pike, Rockviller Md. Under¬

writer—Whitney & Co., Inc.. "Washington, D. C.

(par $3)

Prairie Fibreboard Ltd.

stockholders
share for each 10 shares held as
common

shares of common stock (par $1.50)

Feb. 28 filed 210,000
to

8,, 1958: rights expire July 24, 1958. Price—
$16.62 Vi per share. Proceeds—To be applied to the pay¬
ment of $900,000 of short term bank notes, the funds

July

be offered for sale to residents of Canada in the Prov¬

inces

of

Manitoba,

Saskatchewan

and Alberta

and

to

residents of the United States "only in the State of North

1958 construction program.

share. Proceeds — For con¬
struction purpose.
Office — Saskatoon, Saskatchewan,
Canada. Underwriter—Allied Securities Ltd., Saskatoon,

Co.. Chicago. 111.

Canada.

were

and the balance if any,

O. T.

will be applied to the company's
Underwriter—A. C. Allyn &

Oil Inc., Salt Lake City, Utah
April 4 filed 597,640 shares of common stock (par $1)
to be offered for subscription by common stockholders
of record March 24, 1958 at the rate of IV4 new shares
for each share then held._. Employees may purchase 50,000 shares of unsubscribed stock. Price—To stockholders,

$1.75

per share; and to public, $2 per share. Proceeds—
mining, development and exploration costs, and for

working capital and other corporate
writers—Harrison S. Brothers &
both of Salt Lake

Oil &

■

Mineral

purposes.

Under¬

Co., and Whitney & Co.,

City, Utah.

Operations, Inc., Tulsa, Okla.
April 14 filed 200,000 shares of common stock. Price—
$2.50 per share. Proceeds—For payment of loans, various
equipment, and a reserve for future operations. Business
—To acquire and operate mining claims and oil and gas

Price

Private

C. Enterprises

Inc.
March 6 (letter of notification) 23,200 shares of com¬
mon class B stock
(par $1). Price—$5 per share. Pro¬
ceeds—For completion of plant plans; land; construc¬
tion and operating expenses.
Office—2502 N. Calvert
St., Baltimore 18, Md.
Underwriter—Burnett & Co.,

For

Dakota."

used for the 1957 construction program,

Sparks, Md.

fii5ed
shares of common stock. Price—
^er shafe- Pr<>ceeds—For working capital and gen¬

eral corporate
purposes.

Proceeds

Co.

298.000

ity stockholders on the basis of one new share for each
Any unsubscribed shares will be pur¬

four shares held.

offered in exchange for

from which

L^ed J0*000 sdares of

einr.

filed

25

June

Weighing & Vending Machine Corp.
of notification) a maximum of 25,000
(par $1) to be offered to minor¬

(letter

shares of common stock

Colo.

being offered for subscription by

Mo.

construction of plant
working capital. Underwriter—Investment Sales.
Inc., Denver, Colo.

mid for

Securities Co., Boulder,

Western

27

June

Proceeds—
To
and carry
out the projected plan of development and operation.
Office—1406 Pearl
St., Boulder, Colo.
Underwriter-

June

D4rex Co., Kansas City,

July

Co., Dallas, Texas.
Peerless

50,000 shares of common

Price—At par (50 cents per share).
train and procure persons to implement

stock.

Nedow Oil Tool Co.

notification)

cumulative
common

(letter of notification)

4

shares, to be used to pay 6% mortgage
back tax claims, and inter¬
Underwriter—Wiles

notes and interest and to pay

est due on the note to Mr. Harroun.

National Educators Finance Corp.
June

May fair Markets
March

sale of the 300,000

share.

per

;

Valley Land Co., Carlsbad, N. Mex.
March 13 filed 2,000,000 shares of common stock (par
10 cents), of which 300,000 shares are to be offered for
sale by the company and 1,700,000 shares by the present
holders thereof.
Price—$1 per share. Proceeds—From

Corp., Estes Park, Colo.

Crenshaw

Under¬

investment.

Corp., Pasadena, Calif.

Pecos

Co., New York.
National Beryl & Mining

Proceeds—For

market.

writer—Investors Investments

(letter of notification) 2,916,000 shares of non¬
assessable common stock (par one cent). Price—10 cents

(par $1).

■

Inc., Pasadena, Calif. :
May 19 filed 20,000 shares of common stock (par $1).\

9, 1957 filed 5,000

Price—From 80 cents to $1.40 per share.
Proceeds—To go to selling stockholders.
Office—24751

stock

/

5.

Peckman Plan Fund,

Municipal Investment Trust Fund, Inc.

Inc.

Corp., Salt Lake City, Utah

Production

the company
3,000 for serv¬
ices; the remaining 664,818 shares are to be offered to
the public. Price—To be supplied by amendment. Pro¬

of notification) 60,000 shares of com¬
cents). Price—$5 per share. Proceeds—

• Motion

(letter of notification) 34,000 shares of common

—

of which 100,000 shares are to be offered by

purchase of land, construction and working capital.
Underwriter—Southeastern Securities Corp., New York.

May

-

April 18 filed 767,818 shares of common stock (par $1),

Roanoke, Va.

For

&

'

June 18

Underwriter—Van Alstyne, Noel &

Nov. 18, 1957 (letter
mon

(7/23)

Inc.; Glore, Forgan & Co.; and Blyth &
To be received until 10 a.m. (CDT) on
July 23 at 11 South La Salle St., Chicago, 111.
Co., Inc. Bids

Co., New York.
Motel Co. of Roanoke, Inc.,

Power Co.

Kalman & Co.,

shares of common stock (par $1).
Price—To be supplied by amendment.
Proceeds — To

selling stockholders.

Thursday, July 17, 1958

$9,000,000 of first mortgage bonds due 1988.
Proceeds—For the purpose
of retiring existing bank
loans and to supply cash for further construction expenditures. Underwriter—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;

July 2 filed 277,320

■

of "young, aggressive and expanding life and

Otter Tail

(7/24-25)

Montrose Chemical Co.

.

June 20 filed

price on the New York Stock Exchange. Proceeds—To¬
gether with other funds, to carry on the company's con¬
struction program through 1959. Underwriter—None.
•

.

properties. Underwriter—Universal Securities Co., En¬
terprise Building, Tulsa, Okla. V

Power Co.

Montana

Continued from page 35

.

—

$2.50

per

Enterprise, Inc., Wichita, Kansas

May 5 filed 125,000 shares of common stock.

Price—$10

share. Proceeds — To be used to organize, or re¬
organize and then operate companies in foreign nations,
principally, but not exclusively, in the Far East, Near
per

East and Africa.

Underwriter—None.

^ Psychological Corp.
July 3 (letter of notification) 6,000 shares of capital stock
(no par)
rata

to be offered to present stockholders on a pro
During the period commencing on the date

basis.

ending on Nov. 1, 1958, cash stock¬
3 shares for each 4 shares held, or
or 2 shares for 1 share held; un¬
subscribed shares will be offered to officers, directors
and employees and stockholders without limitation. Price
—$41.50 per share. Proceeds—To be added to working
capital and to retire bank loans. Office—304 E. 45th St.,
New York 17, N. Y. Underwriter—None.
of

the offering and

holder may purchase
3

shares for 2

shares

Rand Drilling Co.,

Inc.

May 12 (letter of notification) 100,000 shares of class A
common stock
(par 50 cents) and 50,000 shares of class
B common stock (par 50 cents) to be offered in units of
two shares of class A and one share of class B stock.

Volume 188

Number

5760

.

.

The Commercial and Financial Chronicle

.

Price—S4.50 per unit. Proceeds—For expenses incidental
to drilling for oil.
Office—IIIV2 E. St. Peter St., New

Iberia, La.

Underwriter

Orleans, La.

—

T. J. Feibleman & Co., New

,

,

Rapid-American Corp., New York
June 19 filed $1,504,000 of 7% sinking fund
debentures,
due Nov. 15, 1967, together with 105,000 shares of com¬
mon

stock

(par $1). Proceeds—The debentures are al¬
outstanding having been issued in payment of

ready

47,000 shares of common stock of Butler Brothers which
were acquired by Rapid American from 19
persons, in¬
cluding three directors of the corporation.' The deben¬
tures are being registered against the possibility that
they may be sold by present owners.
Of the 105,000

shares, 75,000

issuable under the company's
Restricted Stock Option Plan for officers and key em¬
ployees, and 30,000 under the Employees' Stock Pur¬
common

are

Underwriter—None.

chase Plan.

Rassco Financial Corp. (8/20)
June 26 filed $1,000,000 of 15-year 6%
;

ing capital and general corporate purposes. Underwriter
Israel Corp., New York, on a "best efforts"

—Rassco

basis.
Petroleum

Ltd., Alberta, Canada

the company and 824,000 shares for the account of cer¬
tain selling stockholders. The company proposes to offer

the 1,174,716 shares for subscription by its shareholders
at the rate of one new share for each three shares held.
Price—To be supplied by amendment. Proceeds—To

bentures and

off demand note, to pay other
indebtedness, and the bal¬
if any will be added to

working capital. Under¬
Vancouver, Canada.

Riddle Airlines, Inc., Miami, Fla.
May 15 filed 750,000 shares of common

shares

"best efforts" basis.

Robosonic
12

filed

Price—$3

per

contract basis

of

common

stock

to

be

of¬

amount

unit.
and

working capital.

of short-term

Underwriter—None.

of

■

■

—$12.25

per

June 10, 1958.

Price
Proceeds—For working capital. Un¬

share.

derwriter—None.

..■.'V;;.,;^v....{•.I,

(

Tampa Electric Co. (7/17)
13 filed $25,000,000 first mortgage bonds due 1988.

Proceeds—For
be

construction

determined

competitive

by

National Industries Corp., N. Y.
500,000 shares of common stock, class B.
share. Proceeds—To manufacture on a

automatic telephone answering instru¬
ment; the enlargement of the research and development
facilities of the company; patent and patent
an

applications;
public relations, and for working capital. Underwriter—
None.

Underwriter—To

program.

bidding.

Probable bid¬
ders: Halsey, Stuart & Co. Inc.; Stone & Webster Securi¬
ties Corp.; Kuhn, Loeb & Co.; Merrill Lynch, Pierce,
Fenner & Smith; Goldman, Sachs & Co. Bids — To be

St., New York,

up to

11

a.m.

/V-

July 17, 1958.

(EDT)
T?

Tax Exempt Bond

Fund, Inc., Washington, D. C
1957 filed 40,000 shares of common stock. Price
—$25 per share. Proceeds—For investment. Underwriter
—Equitable Securities Corp., Nashville, Tenn. Offering—
Held up pending passing of necessary legislation by
Congress.
June 20,

Tennessee Gas Transmission Co.

June 2 filed 1,084,054 shares of common stock (par $5)
being offered in exchange for common stock of Middle
States Petroleum Corp. at the rate of 45 shares of Ten¬
Gas

common

for each 100 shares of Middle States

common; it is a condition of the exchange offer that it
be accepted by holders of not less than two-thirds (1,-

606,005 shares) of the outstanding 2,409,007 Middle States
Offer expires July 24. Dealer-Manager—Dillon,
Read & Co., Inc., New York.
•

common.

Texas Calgary Co., Abilene, Texas
April 30 filed 2,000,000 shares of capital stock (par 25
cents). Price—To be supplied by amendment. Proceeds
—To selling stockholder.
Underwriter—Thomson Kernaghan & Co., Ltd., Toronto, Canada. To be offered in
Canada only.
/v-;-. .

•

Textron

/•.

.

Inc.

,
• .»'•
Kansas City,

••

Century Investors, Inc.,
1

.

writer—Stowers & Co., Kansas

Twentieth

:

.

City, Mo.

.,

Century Investors Plan,

Kansas Cityv

Mo.

June

Systron Corp., Concord, Calif.
10 (letter of notification) 24,475 shares of
capital
stock (par $5) to be offered, to stockholders on the basis
on

Proceeds—For drilling for oil and gaa.
Street, Coudersport, Pa. Under¬

Main

June 20 filed 2 000,000 shares of common stock (par $1)^
Price—At maii.et.
Proceeds—For investment. Under-,

per

June

of one share for each share held

N.

Wo.

-

bank loan

$1,200

—

Proceeds—For payment

share.

per

writer—None.

^

in units consisting of $800
principal
debentures and 26 shares of stock. Price

nessee

stock (par 10
Price—To be supplied by amendment. Proceeds
—For working capital. Underwriter—James H. Price &
Co., Inc., of Coral Gables, Fla., for 250,000 shares; balance

cents).

June

12.766

—$4

Office—203

Twentieth

fered

pay

writer—Pacific Securities Ltd.,

or more

Sugarbush Valley Cbrp., Warren, Vt.
June 25 filed $392,800 of 20-year 6% subordinated de¬

on

June 26 filed 1,998,716 shares of common stock
(par $1).
Of this stock, 1,174,716 shares are to be sold on behalf of

ance

one

William#
Underwriter—

Process to beneficiate manganese ores.
Southwest Shares, Inc., Austin, Texas.

received at 90 Broad

Richwell

on

Proceeds—To erect and operate

processing plants using the Bruce

June

series A sinking
fund debentures due 1973, to be offered in denominations
of $500 and $1,000. Price—At par. Proceeds—For work¬

;

share.

per

chemical

31

(233)

20 filed

$10,000,000 of plans for the accumulation,
Century Investors, Inc. Price—At

of shares of Twentieth

market.

Proceeds

Stowers &
•

United Artists

June

—

For

investment.

(7/18)

Corp.

filed 200,000 shares

27

Underwriter—

Co., Kansas City, Mo.
of

/

/,

common

stock

(par $J>

for the corporation's account, and 100,000 shares for cer¬
tain selling stockholders.
Price — To be supplied

by

amendment.

Proceeds—To provide funds

to finance

ant

expanded program of motion picture production and to
broaden U.A.'s activities in the television, recording and
music

publishing fields.

Underwriter—F.

Eberstadt

Co., New York.

&

-

United

Employees Insurance Co.
April 16 filed 2,000,000 shares of common stock (par $5},
Price
$10 per share. Proceeds — For acquisition aS
operating properties, real and/or personal, including:
office furniture, fixtures, equipment and office space, by
—

lease or purchase.
Office — Wilmington, Del. Under¬
writer—None.
lVEyrl L. McKee of Portland, Ore., i»
President.
v-/,• ,:/v
;
.

.

United States

Sulphur Corp.
Oct. 8 filed 1,500,000 shares of common stock (par one
cent). Price—$1 per share. Proceeds—For plant rental,
etc.; to retire corporate notes; for core drilling; torn J
working capital; and for other exploration and development

work

None.

Office

Statement

—

Houston

effective

Texas.

June

Underwriter

—

23.

United States Telemail Service, Inc.
17 filed 375,000 shares of common stock

Feb.

Price—$4

per

(par $1).
share. Proceeds—To purchase equipment,

and supplies and for working capital and other corporate
purposes.
Office—Salt Lake City, Utah. Underwriter—

Amos Treat &
Universal

Co., Inc., of New York.
Oil

Recovery Corp., Chicago, III.
37,500 shares of class A common stock. Price
—$4 per share. Proceeds—For exploration and develop¬
ment of properties, and the balance for other corporate
June 4 filed

Underwriter—None.

purposes.

.

June

Rocky Mountain Quarter Racing
Oct. 31, 1957 (letter of notification)
common stock.
Price—At par ($1 per
—To repay outstanding indebtedness.
Colo.
Underwriter—R. B. Ford Co.,
Memphis, Ttoi.

Association
300,000 shares of
share). Proceeds

Office—Littleton,
Windover

Road,

St.

Regis Paper Co., New York
July 8 filed 118,746 shares of common stock (par $5)
to be offered in exchange for outstanding shares of capi¬

20 filed 389,577 shares of common stock (par 50
cents), being offered for subscription by common stock¬
holders of record on July 14, 1958, at the rate of one new
share for each 10 shares then heled. Rights expire July
30, 1958. Price—$9.75 per share. Proceeds—To reduce
short-term bank borrowings incurred in financing the
acquisition by Textron on June 28, 1958, of the assets,
properties
and
business
of
The
Waterbury
Farrel
Foundry & Machine Co. Underwriter—Blair & Co., Inc.,

New York, and

tal stock of Growers Container

the basis of

one

Corp., Salinas, Calif., on
St. Regis share for 18 shares of stock of

Growers Container.

Underwriter—None.

->lr St. Regis Paper Co.
July 10 filed 250,000 shares of
to be

offered

from

time

to

common

time

to

stock

certain

(par $5)
employees,

including officers

of the company and its subsidiaries
pursuant to the terms of the company's Employees' 1958
Stock Option Plan.

Thomas Paint Products Co.

May 26 (letter of notification) 1,250 shares of common
stock (par $10) and $37,500 of 6% serial subordinated
debentures series 1958, to be' offered in units of one
share of stock and $50 principal amount of debenture#
to be offered to stockholders

-

San

Diego

Imperial Corp.,

San Diego, Calif.

Proceeds—To retire $550,000 of promissory notes. Under¬
writer—J. A. Hogle & Co,, Salt Lake City, Utah.

non¬

ing various interests in real property and leases; also
capital. Office—655 Broadway, Denver, Colo.

working

Oil Co.

July 1, 1983. Price—To be supplied by amendment. Pro¬
ceeds—To refinance a bank obligation of
$50,000,000 due
this year to provide additional capital for the company'i
overall program.
Underwriters—Blyth & Co., Inc., and
Dean Witter & Co., both of San
Francisco, Calif., and
New York, N. Y. Offering—Postponed from June 25
by
company

"due to market conditions."

Issue

to

re¬

main in registration.
•

Standard Packaging Corp., New York
4 filed 225,385 shares of the
company's commou
stock (par $1), such shares are to be issued to Johnston
Foil Manufacturing Co., a New Jersey

corporation, under

agreement pursuant to which Standard acquired sub-

tantially all of thea ssets of Johnston.

Statement effec¬

tive July 2.

July 9 (letter of notification) 50,000 shares of common
stock (par $1).
Price—$5 per share. Proceeds—To be
invested in stocks and bonds and to acquire other life
insurance companies. Address—P. O. Box 678, Gulf
port,
Miss. Underwriter—Gates, Carter & Co.,
Gulfport, Miss.

Strategic Minerals Corp. of America, Dallas, Tea.
March 31 filed $2,000,000 of first lien mortgage 6% bond#
975,000 shares of

—For bonds. 95%

common

stock (par 10 cents). Pric*

of principal amount; and for stock




Ga.

Underwriter—

Graham

Tip Top Oil & Gas Co.f Salt Lake City, Utah
April 15 filed 220,000 shares of common stock, of which
200,000 shares are to be publicly offered. Price—$5 pei
Proceeds—To drill two

&
e

new

Underwriter

purposes.

wells and for genera)

—

Andersen-Randolph

Co., Inc., Salt Lake City, Utah
Townsend U. S. &

$3

Griswold

of

Portland,

Ore.,

is

Pres¬

Utah Minerals Co.

.

April 11

(letter of notification) 900,000 shares of com¬
mon stock.
Price—At par (10 cents per share). Proceeds
—For mining expenses. Office—305 Main St., Park
City,
Utah.
Underwriter—Walter Sondrup & Co., Salt Lake
City, Utah.
Utah Oil Co. of New

York, Inc.

May 6

(letter of notification) 300,000 shares of capital
stock. Price
At par ($1 per share). Proceeds — For
development of oil and gas lands. Office—574 Jefferson
Ave., Rochester 11, N. Y. Underwriter—Frank P. Hun#
& Co., Inc., Rochester, N. Y.
—

June

(letter of notification) 27,272 shares of 70-cenl
cumulative preferred stock (par $5) and 27,272 share#
of common stock (par 10 cents) to be offered in unit#
of one share to each class of stock. Price—$11 per unit
Proceeds
For working capital.
Office — 111 E. Main
St., Morristown, Tenn. Underwriter—Valley Securitiei
Corp., Morristown, Tenn.

share.

Albert

ident.

Utah Power &

Tlmeplan Finance Corp.
March 25

International

Growth

Fund

Inc.,
May 14 filed 1,000,000 shares of capital stock (par one
cent). Price—Initially at $5 per share (part at private
sale).
Proceeds—For investment.
Office—Short Hills,
N. J.
Underwriter
FIF Management Corp., Denver,
Colo. Statemente ffective July 3.

1988.
gage

bank

Light Co. (8/11)
$20,000,000 of first mortgage bonds due
Proceeds—To redeem $15,000,000 of first mort¬
bonds, 51/4% series due 1987, to repay $4,000,000 of
borrowings, and the balance together with further
26

filed

borrowings under
in

a bank agreement and cash generated
the business will be used to carry forward the con¬

struction

program of the company and its subsidiaries
amounting to approximately $43,000,000 for the period
1958-1960. Underwriter—To be determined by competi¬
tive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; First Boston Corp. and Blyth & Co. Inc. (jointly);

White, Weld & Co. and Stone & Webster Securities Corp.
(jointly); Salomon Brothers & Hutzler; Kidder, Peabody
& Co.; Eastman Dillon, Union Securities & Co., and
Smith, Barney & Co. (jointly); Lehman Brothers and
Bear, Stearns & Co. (jointly). Bids—Expected to be re¬
ceived in Room 2033, 2 Rector Street, New York, N. Y.,
up to noon (EDT) on Aug. 11, 1958.
Washington Water Power Co.

(7/23)

—

Trans-America

one

Uranium

Mining Corp.
shares of common stock (pai

mill). Price—25 cents per share. Proceeds—For land

acquisition, exploratory work, working capital, reserves
and other corporate purposes. Underwriter—None. Al¬
fred E. Owens of Waterloo, la., is President.
Trans-Cuba Oil Co., Havana, Cuba
March 28 filed 6,000,000 shares of common stock (par 50

cents) being offered for subscription by holders of out¬
standing shares of capital stock and holders of bearer

★ State Life, Health & Accident Insurance Co.

and

W., Atlanta,

St., S.

Nov. 6, 1957 filed 3,000,000

June

an

Whitehall

corporate

.

(Calif.)
June 4 filed $150,000,000 of sinking fund debentures due

the

unit for

April 30,1957 filed 1,250,000 shares of common stock(par
16 cents).
Price—To be supplied by amendment (ex¬
pected to be $1 per share). Proceeds—For exploration
purposes.
Underwriter—To be named by amendment.

—

transferable
time
certificates payable
upon
demand.
Price—At par (in denominations of $1 to $5,000). Pro¬
ceeds—For real estate loans and purchasing and acquir¬

Standard

one

None.

June 2 filed 70,000 shares of 5%% cumulative convert¬
ible preferred stock. Price — At par ($10 per share)

Underwriter—None.

the basis of

(500 of the shares are
being offered to the President of the company). Price—
$60 per unit. Proceeds—For working capital. Office—

(7/24)

^ Security Thrift & Mortgage Co.
July 3 (letter of notification) $300,000 of 41,2%

on

each two shares of stock owned

543
>

Scherck, Richter Co., St. Louis, Mo.

Uranium Corp. of America, Portland, Ora.

shares, in the ratio of

additional share for each share
so held or represented by bearer shares of record
May
28, 1958; rights to expire on Aug. 1, 1958.
Price — 50c
per share.
Proceeds—For general corporate purposes
including exploration and drilling expenses and capita)
expenditures. Underwriter—None.
one

Trans-Eastern Petroleum Inc.

Feb- 27 (letter of notification) 7,500 shares of common
(par $1) to be offered pro-rata to stockholders on
,

Of

one

new

share for

10

filed

26

$15,000,000 of first mortgage bonds due
1988, and 200,000 shares of common stock (no par). Price
—To be supplied by amendment. Proceeds—To be ap¬
plied in part to the repayment of $15,500,000 of outstand¬
ing notes, the proceeds of which were used for property
additions
ceeds

and

will

be

improvements.
used

to

meet

The balance of the pro¬
construction

requirements.
Underwriters—Kidder, Peabody & Co., Blyth & Co., Inc.,
White, Weld & Co. and Laurence M. Marks & Co., all of
New York.

Western Carolina Telephone Co.,
N. Car.
June

6

89,391 shares of common stock to be of¬
for subscription by holders of outstanding com¬

fered
mon

Weaverville,

filed

stock at the rate of

shares held.
ment.

one

new

share for each three

The record date is to be supplied by amend¬

Price—At par

($5 per share). Proceeds—To be
applied to the payment of $700,000 of short-term bank
incurred in carrying forward the company's con¬

loans

stock

the basis

June

shares owned.

Pries

struction and conversion program.

Underwriter—None.

Continued

on

page

38

The Commercial and Financial

38

May 26 filed 564,000 shares of common stock. Price—At
($1 per share). Proceeds—For capital expenditures

par

Office—Santa Paula, Calif.

costs.

Un¬

Westland Oil Co., Minot,

N. Dak.

April 17 filed 7,799 shares of capital stock to be offered
for subscriotion by stockholders of record March 24 at
rate of one'new share for each four shares held and one
additional share for the balance of such holdings in
excess of the number of shares divisible by four; also
to be offered holders of outstanding 5% subordinated?
debentures of record March 24 at rate of five shares for,

of debentures then held. Price — $60 per
Proceeds—For working capital.
Underwriter—

each $1,000
share.

•

None.

general corporate purposes. Office—151 Adell Avenue,
Yonkers, N. Y. Underwriter — Edwin Jefferson, 39
Broadway, New York 6, N. Y.

if Witco Chemical Co., Inc. (7/30)
July 10 filed 200,000 shares Of common stock (par $5) of
^Atfch 50,000 shares will be sold for the account of sell¬
ing stockholders. Price—To be supplied by amendment.
Proceeds

for general corporate purposes,

To be used

—

construction and expansion program on
currently engaged. UnderwritersSmith, Barney & Co. and Goldman, Sachs & Co., both
including

the

which the company is

of New York.

issue
1988.

Prospective Offerings

•

For expansion and

March 21 it

tional

was

in the form of common stock,
preferred stock, or a combination of the two, including
bank loans.
Proceeds—For expansion program, work¬
year,

ing capital and inventories. Underwriters—Blyth & Co.,
Inc. and Merrill Lynch, Pierce, Fenner & Smith.
American-South African Investment Co.

it was announced that the company plans to
and sell $25,000,000 of preferred stock. Proceeds—

expansion

improvement of

and

be

Underwriter—May

determined by

service facilities.
competitive bid¬

White, Weld & Co. and Shields & Co.
Expected to be received on Sept. 23.
•

Co.; The First
Co. (jointly);

(jointly). Bids-

Investment Company Act of 1940.

Business—The trust,
incorporated under the laws of the Union of Africa, has
been organized to provide a medium for investment in
the common shares of companies engaged in business in
South Africa, with particular emphasis on those engaged
in mining gold. The trust may also invest to a certain
extent in gold bullion. Underwriter—Dillon, Read & Co.

Inc., New York.
Associates

some

Investment Co.

issue
1983.
Underwriter—Kidder, Peabody & Co. Inc., New York.

Underwriters

—

Salomon Bros.

& Hutzler and Lehman

bonds, to repay short-term
Underwriter!

private sale of 41/2%

California

July 14 it

Electric

was

determined.

announced company contemplates mar¬

Decision

on

these two points will probably

fiOt be reached until mid-August or

early September.

Central tfadley Corp.
fhe shareholders of the company at a special meeting
held on June 25, approved an amendment to the certi¬
of

shares

incorporation

of

5%

authorizing

cumulative

an

convertible

issue of 200,000
preferred stock

(par $10). Convertible into common stock at the rate
of $2.86 per share. Proceeds—To retire outstanding notes
of a subsidiary in the amount of $768,000.
Louisiana

Central

March 28 it

was

Electric

Co.,

announced that the

Inc.
company's financing

program for the year 1958 anticipates the sale of both
debt and equity securities (probably preferred stock)

aggregating approximately $5,000,000.
be placed privately.

Both issues

may

Cincinnati & Suburban Bell Telephone

Co. <10/21)

;

July 7 it Was announced that the directors have
ized

the

sale

of

not

exceeding

author¬

$25,000,000

debentures
having a maturity of not more than 35 years. Proceeds
—To repay advances received from American Telephone
& Telegraph Co. which owns 29% of the outstanding
stock of

the company.
Underwriter — To be
by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.; Glore,
Forgan & Co. and Eastman Dillon, Union Securities &

coittmon

determined

Co. (jointly).

Bids—Expected to be received

on

Oct. 21.

Columbus & Southern Ohio Electric Co.

Dec. 9 it was reported company plans to issue and sell
•bout 250,000 additional shares of common stock. Under¬
writers — Dillon, Read & Co. Inc. and The Ohio Co.

(jointly).
Ih 1958

bidders may be Halsey, Stuart & Co. Inc.;
Merrill Lynch, Pierce, Fenner & Smith, and White,
Weld & Co. (jointly); Blyth & Co., Inc.; The First Boston
Corp.; Lehman Brothers.

probable

General

Public

Utilities Corp.

or

Permanent financing not expected until late
possibly early in 1959.

^ Consolidated Natural Gas Co. (S/13)
Company plans to issue and sell $45,000,000 30-year sink¬
ing fund debentures. Proceeds—New construction. Un¬




competitive

by

bidding.

Probable bidders;

&

Co.; Blyth & Co., Inc.; Equitable Securities Corp.

•

"i.

June

Blyth & Co., Inc. and J. J. B. Hilliard & Sonic Keystone Tax-Exempt

July 14 it

stockholders

7

stockholders, also to offer certain shares on the same
employees, including officers, of System com¬
panies. Clearing Agent—Merrill Lynch, Pierce, Fenner
to

terms to

York.

Company

to

issue

approximately

$18,000,000

of

on the new "Santa Rosa" and
"Santa
financing will comprise two issues of $9,-

mortgage
The

000,000 each. Underwriters—Merrill Lynch, Pierce, Fen¬
ner and Smith; Paine, Webber, Jackson & Curtis; Smith,
Barney Co.; White, Weld & Co.; and F. Eberstadt & Co.,
all of New York. Offering—Expected at end of July.

Feb. 19 it

it

reported

a

May include: Blyth & Co., Inc.; Carl M. Loeb, Rhoades
& Co.; Hemphill, Noyes & Co.; Smith, Barney & Co.;
and Merrill Lynch. Pierce, Fenner & Smith.
Gulf Interstate Co.
June 5

it

plans to offer to bona fide residents of
10,000 shares of capital stock (par $1). Price
share, less an underwriting discount of 8l/2%.'

California

—$10 per

Proceeds—For investment.

repay

Inc.

28, company announced it plans to issue on or
Dec. 31, 1958 $3,200,000 of first preferred mort-.

before

gage

bonds. May be placed privately. Proceeds
bank loans and for working capital. ■

Hackensack Water Co.

—

Tor

Midwestern Gas Transmission Co.

it

24

announced

was

that this subsidiary of
applied to the Fed¬
permission to issue first

Tennessee Gas Transmission Co. has

eral

for

Commission

Power

bonds, unsecured notes and common stock.
line system to cost about $111,-.
Underwriters — Stone & Webster Securities
Corp. and White Weld & Co., both of New York.

mortgage

Proceeds—To build pipe

000,000.

Minneapolis & St. Louis Ry. (8/5)
the company up to noon (CDT)

Bids will be received by

Aug. 5 for the purchase from it of

on

$2,100,000 of series

equipment trust certificates due annually on Aug. 26
from 1959 to 1973.
Probable bidders: Halsey, Stuart &
B

Salomon Bros. & Hutzler.

Co. Inc.;

Utilities Co.

Montana-Dakota

reported the company plans to issue and
undetermined amount of first mortgage bonds in

March 24 it
sell

an

was

the latter part

of this year or in early 1959. Underwriter
by competitive bidding. Probable

determined

be

—To

Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.;
Lynch, Pierce, Fenner & Smith and Kidder,

bidders:

Merrill

Peabody & Co., Inc.,

(jointly); and Blair & Co., Inc.

Moore-McCormack Lines, Inc.

plans to issue and

$24,000,000 of government insured bonds secured by
a first preferred ship mortgage on the liners S. S. Brasil
and S. S. Argentina. Underwriters—Kuhn, Loeb & Co.
and Lehman Brothers, both of New York. Offering—Ex¬
sell

pected this Summer.

England Telephone & Telegraph Co.

(8/26)

April 11 it was announced company plans to issue and
sell $40,000,000 of debentures. Proceeds—To redeem si
like amount of 4 xk % bonds due 1961. Underwriter—To
be determined by

competitive bidding. Probable bidders;

Halsey, Stuart & Co. Inc.;

Bids

Stanley & Co.

gan

The First Boston Corp.; Mor¬
Expected to be received on

—

'

Aug. 26.
New

York State

March 7 it

was

Electric and Gas Co.

announced that approximately $7,500,000

will be required for construc¬

expenditures for the balance of this year. The man¬
agement intends to negotiate a new line of credit with a
tion

of banks and expects to sell equity securities later
or in early 1959, depending upon prevailing
market conditions. Underwriter—For any common stock:
group

this

year

The First Boston

Corp., New York.

Norfolk & Western

•

announced company

(formerly known as
Gulf Interstate Oil Co.) intends to obtain a minimum
of $2,000,000 and a maximum of $5,000,000 via an offer¬
ing of new shares of common stock to stockholders in
August or September. Proceeds — For working capital.
was

was

ment company

from additional financing

secondary offering of common
voting stock is expected in near future. Underwriterswas

Fund, Inc., Fairfield, Caiif.
announced this newly organized invest¬

Master

New

Inc.

plans

Underwriter—Lehman Brothers, New;

,

Jan. 27

Smith, New York.
Grace Line

Bond Fund

announced that this proposed fund will
of the present Keystone Custodian.

was

continuation

a

March 24 it was announced company

approved a plan authorizing the
directors in connection with an offering of common stock

April

Great Atlantic & Pacific Tea Co.

& Power Co.

the nature of the securities to be offered has been

ficate

reported that company plans to issue

was

$11,000,000 of first mortgage bonds later this year. No de¬
cision as yet has been made as to the procedure the com¬
pany will follow.
Proceeds—For repayment of shortterm notes
and loans and for construction program.
Underwriter
If determined by competitive bidding,

Paula."

keting between $5,000,000 and $7,000,000 securities in
the Fall Of 1958. Neither the exact date of the offering
nor

Service Co.

Gas

March 24 it

ship

announced that the country contemplates
the issuance and sale of $30,000,000 bonds. Proceeds—For
electric power projects and other improvements. Under¬
writer—May be Kuhn, Loeb & Co., New York. Offer¬
ing—Expected in October or early November.
was

plans to issue and

Halsey, Stuart & Co. Inc.; The First Boston Corp.; Glore;.
Forgan & Co.; Harriman Ripley & Co. Inc.; White, Weld

March

Equitable Gas Co.
April 7 it was reported that the company expects later
in the year to issue and sell additional securities, prob¬
ably preferred stock, to secure approximately $5,000,000
of additional funds. Proceeds—Together with $7,000,000

government insured bonds secured by a first preferred

-^-Austria (Republic of)
July 15 it

determined

Offering—Temporarily postponed.

was

Brothers, both of New York.

company

Midland Enterprises,

July 7 it was reported that the company plans to
and sell $25,000,000 sinking fund debentures due

&

reported company plans to issue and sell
additional debentures (amount not yet determined).

Jan. 23 it

Light Co.

announced

was

$10,000,000 of first mortgage bonds dtie 1988.. Prcr-*
ceeds—For construction program.
Underwriter—To be

March

Corp. of America

Container

—

June 13 filed for permission to become registered as an
investment company of the closed-end type under the

&

Power

it

sell

14

ding. Probable bidders: Morgan Stanley &
Boston
Corp. and Harriman Ripley &

announced that the company plans addi¬

financing this

14

Fund, Series B-l.

(9/23)

Power Co.

Consumers

July

—May be The First Boston Corp.; Kidder, Peabody &
Co.; Merrill Lynch, Pierce, Fenner & Smith; and White,
Weld & Co., all of New York.

Co.

Steel

Acme

Feb.

Sept. 23.

—

bank loans and for construction program.

^

Thursday, July 17, 1953

be

from

I

..

Kentucky Utilities Co.
16 company stated it will sell bonds and/or com¬
mon
stock in the last quarter of 1958.
Underwriters—•

For

April 2 (letter of notification) 72,035 shares of common
stock (par $1) of which 10,000 are to be offered to stock¬
holders at $2 per share and the remaining 62,035 shares
are to be publicly offered at $3 each.
Proceeds — For

•

.

improvement of service
facilities. Underwriter—To be determined by competi¬
tive bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Morgan Stanley & Co.; White, Weld & Co. and Shields
& Co. (jointly); The First Boston Corp. and Harriman
Rioley & Co. Inc. (jointly). Bids—To be received on
Proceeds

issue

System, Inc.

Wilier Color Television

(jointly);
(jointly).

(9/23)

Power Co.

Consumers

Weld &

July 14 it was announced that the company plans to
and sell $25,000,000 of first mortgage bonds due

derwriter—None.
1

Paine, Webber, Jackson & Curtis
Morgan Stanley & Co. and First Boston Corp.
Bids—To be received on Aug. 13.
and

Co.

Co., Inc.

Western Pacific Mining

ahd exploration

Halsey, Stuart & Co.; White,

Probable bidders:

Kansas

determined by competitive bidding.

be

derwriters—To

Continued from page 37
(

Chronicle

(234)

Ry.

(8 20)

received by the company on
Aug. 20 for the purchase from it of $2,340,000 of series
P equipment trust certificates. Probable bidders: Halsey*
Stuart & Co. Inc.; Salomon Bros. & Hutzler.
Bids

expected to be

are

Illinois Gas Co.

Northern
June

10

it

was

announced company will sell this Sep¬

March

12, George H. Buck, President, said that com¬
plans to sell some $7,000,000 in new securities by
the end of this year in the form of first mortgage bonds
and preferred stock. Recent bond financing was made
privately. In event of competitive bidding for bonds or
debentures, bidders may include: Halsey, Stuart & Co
Inc.; The First Boston Corp. and White, Weld & Co
(jointly); Stone & Webster Securities Corp.; Blyth &
Co., Inc.; Drexel & Co. and Dean Witter & Co. (jointly)
The First Boston Corp. and White, Weld & Co. (jointly)
underwrote last common stock financing.
There is no

tember

pany

supply from Northern Natural Gas Co. is approved by
Federal Power Commission. In event this project has to

preferred stock presently outstanding. Private sale of
30,000 shares ($3,000,000) of preferred is planned.

March

be

it

issue

sell

and

was

Co., Inc.

announced that the company

plans to

$3,000,000 of first mortgage bonds. May
loans and

be placed privately. Proceeds—To repay bank
for new construction.

Kansas Gas & Electric Co.
March 31, G.

W. Evans, Chairman, announced that com¬
plans to sell some bonds originally scheduled for
mid-year, but which sale may now be deferred until
late 1958 or early 1959. Proceeds—About $8,000,000 for
construction program.
Underwriter—To be determined
by
competitive
bidding.
Probable
bidders:
Halsey,
Stuart & Co. Inc.; Kidder, Peabody & Co., and Merrill
Lynch, Pierce, Fenner & Smith
(jointly); Lehman
Brothers; Eastman Dillon, Union Securities & Co. and
Stone & Webster Securities Corp. (jointly); Glore, Forgan & Co., and Goldman Sachs & Co. (jointly).

pany

gas

deferred, company will likely issue $10,000,000 bonds
in the year.
Company's 5-year construction pro¬

later

gram

calls for $90,000,000 outlay. Underwriter—To bd
by competitive bidding. Probable bidders;

determined

Halsey,

Stuart &

Co. Inc.; First Boston Corp.; Glore,
Co., Inc.

Forgan & Co.; Blyth &
.

Pacific Gas & Electric Co.
it

20

was

reported

plans sale of an

company

undetermined amount < of bonds
the latter

Indiana Gas & Water
March 25

mortgage bonds providing new

$20,000,000

and preferred stock ip

part of this year or early

1959. Underwriter

—(1) For bonds to be determined by competitive bid*
ding.
Probable bidders—The First Boston Corp. and
Halsey,Stuart & Co. Inc. (jointly); Blyth & Co., Inc.; (2)
For

preferred stock: Blyth & Co., Inc.

;

& Telegraph Co.
reported company plans $300,600,000 capi¬

Pacific Telephone
Jan. 8 it was

tal outlay program.

Proceeds—For construction program

($137,000,000 in 1958). Underwriter-*
To be determined by competitive bidding. Probable bid*
defs— Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.
in

1958 and 1959

if Panama

J

(Republic of)

July 14 it was announced a

public offering is expected

approximately $26,000,000 external bonds.: Proceeds^To redeem certain outstanding debt and for Panama's
of

feeder
New

road

York.

program.

Underwriter—Lehman

Brothers,

Volume

168

Number 5760

.

.

The Commercial and Financial
Chronicle

.

Public Service Electric & Gas Co.

May

26

it

was

that

announced

(235)

(8/20)

the

plans
early registration of $60,000,000 of first refunding moftgage bonds due 1988.
Underwriter—To be determined
by competitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; The First Boston
Corp.; Kuhn, Loeb & Co.
Lehman

and

Brothers

(jointly).

received up to 11 a.im (EDT) on

J St. Joseph Light

Southern Colorado Power Co.
9 stockholders authorized an

company

Bids—Expected to be
Aug. 20.
' ' ";r
-

& Power Co.

May
-

shares

Stone

of
&

additional 100,000
$50).
UnderwritersCorp. and Paine, Webber,

preferred stock
(par
Webster Securities

Jackson & Curtis.

"

July 2 it

bank

loans

and

for

be

construction

program

determined

by competi¬
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Smith, Barney & Co., Glore, Forgan & Co. and Blair
& Co. Inc. (jointly);
White, Weld & Co.; Equitable Secu-...
rities Corp. Last preferred
financing was done privately
-

South Carolina Electric & Gas Co.

April 7 it
to

sell

announced by the
company that it plans
additional bonds during the latter
part of
Proceeds — Together with bank loans, to be
was

some

the jear.
used

for

be placed

$16,000,000 construction program. Bonds
privately through Kidder, Peabody & Co.

Southern California Edison Co.

.

July 3 it

may

(8/25)

that the company
contemplates
the sale of about $50,000,000 of first and
refunding mort¬
gage bonds.
Proceeds—For construction program. Un¬
derwriter—To be determined by- competitive
bidding.
was announced

Probable bidders: Halsey, Stuart & Co.
Inc.; Kuhn, Loeb
& Co.; First Boston
Corp., and Dean Witter & Co. (joint¬
ly); Blyth & Co., Inc. Bids—Expected to be received on

Aug. 25.

!

"

from

Underwriter

was

Standard

stock

United

Ellis

.

*

r
'

I

group is one

tllO East Wisconsin Avenue, Milwaukee 1, Wis.

making

payment
either

on

for

the

July

-

a
•

report on Hagan Chemicals &
■

■

-.

—

Memorandum

Controls,

The

are

The

a

memorandum

on

1965

fund

and

1963

at

a

:

Simplicity Pattern
Report — Thomson & McKinnon, 11 Wall
Street, New York 5, N. Y. Also available is a report on
—

1978.

on

*

;

't

■

Sterling Drug Inc.—Memorandum—Woodcock, Hess, Moyer &

Co., 123 South Broad Street, Philadelphia 9, Pa.
Sundstrand Machine Tool

Co.—Analysis—Hayden, Stone & Co;,

25 Broad Street, New York 4, N. Y.
~
!
Thatcher Glass Manufacturing Co.—Memorandum—A. C.
Allyn
& Co., 44 Wall
Street, New York 5, N. Y.
Thermo King Corporation—Analvsis—G. A. Saxton &

Co., Inc.,

52 Wall

amount

Prices

f

,

Trader^ Finance Corporation Ltd.—Analysis—McLeod, Young,
Weir & Company, Ltd., 50 King Street, West, Toronto, Ont.,
Canada.

United States Life Insurance Company of the
City of New York

r-Analysis—William Blair & Company, 135 South La Salle
Street, Chicago 3, 111.
Whiting Corporation—Analysis—Straus, Blosser & McDowell,
•;
39 South La Salle Street, Chicago 3, 111. Also available is a
.

.

<

memorandum on Pepsi Cola General Bottlers, Inc.
Zale Jewelry Company—Bulletin—De Witt Conklin
Organiza¬
tion—120 Broadway, New York




5, N. Y.

*'

Freeing Up Capital
With
of

the

July 15,

after

to

July

for optional

re¬

principal

virtually the entire capital
underwriting
fraternity

mustered for the task of handling

Big Steel's debentures, it was cer¬
tain that a number of existing

syndicates would be terminated, "f
Those

bound

together by

such

getting their capi¬

these

syndicates

were

na-f

the

Representing: just about a full
line-up of the country's under¬
writing" strength, this group did
not

shy
away
from
the
task
despite the none-too-reassuring

behaviour of the securities markets
since the turn of the week.

And

things turned out they

as

seemed

to

have

been quite

well-

rewarded for their decision to

of

Offering

ahead

-

the. debentures

States Steel Corp.'s

with

issue

met

the

business

for

the

good

decidedly

a

go

ception when the offering books

since

were

1954,

when

it

issued

bentures.
,

proceeds

received from

this

sale

was

that

their

original

little, the

con¬

early sell-out

an

Carrying

part working capital expended in

expansion

and

modernization

program which involved total

ex¬

priced
of

a

to yield

the

world's

4%

coupon

and

major

steel

pro¬

penditures of $1,655,300,000 in the

ducer

quite evidently caught the

five

fancy

of

used

years

for

cluding

future

property
ments.

1953-57,

corporate

will

be

in¬

expenditures

for

additions

The

and

purposes

and

replace¬

expenditures still to

stitutional

major

institutional 'in¬

investors,

including

a

number of the big pension funds.
It remained to be
whether

this

seen

was

however,

the

issue

be made at the beginning of 1958

destined to give the market

plus

footing after its protracted period

new

expenditures authorized

The balance

to have been

was

of sinking
this total

fund debentures.

was

cut back to

a new

But

$40 mil¬

lion.

/

Slow Week Looms

Unless there

are

around,

for

dealers.

the
And

a

quickies

some

it

that

appeal's

relatively slow

underwriters
it

will

be

and

pretty

evenly divided between debt
curities and equities.

3.97%, this issue

one

sub¬

raised through sale of $60 million

period

a

parts,

ordinated debentures being offered
to shareholders of record July 13.

next week will be

ideas downward
sensus

two

convertible

few prospective buyers

general funds to restore in of the deal appeared assured.

to its

of

revised

a

reportedly

.

The corporation will add the net

in

up

$30,597,000

hidden

opened.

Though

$300,000,000 of ten-year serial de¬

The big plane builder had set its

operation

re¬

first entry into the capital market

July,

-

\

Boeing Pares Offering
of

July 14, 1978.

marks United

its

Street, New York 5, N. Y.

expected probably

are

the week-end.

over

years

thereafter

thereafter to the

crease

Transajtnerica Corporation.
,

issues

new

retiring

redemption

decreases

principal

15,

avail¬

Steel Improvement & Forge Co.

Treasury for the refinancing of its
impending maturities. Data on the

bit.

sinking

price starts at 100%%

Fulton, Reid & Co.,

Commerce Building, Cleveland 14, Ohio. Also

able is

,

Much will depend, it appeared,
upon - the
terms
fixed
by the

turally settled back rather sharply
the initial
offering prices.
Consolidated Edison Co, 4s, for
example, dipped to a price of 98%
bid from the original figure of
102.655 where the yield was 3.85%,

not refund¬

July 15,

sinking fund,

amount after

Union

re¬

Treasury

Taking its cue from the market
largest
banking
1965-82, will retire at least 90%
syndicates ever put together han¬ Boeing Airplane Co,, which had
of
the issue prior to
maturity. dled the
set plans for raising more than
$90
marketing of this week's
The corporation may double sink¬
million of capital in the market,
$300 million issue of 25-year sink¬
revised that figure downward a
ing fund payments in any year. ing fund debentures.

the

■
—

the

list.

Where

or

demption start at 105 Ms % to and

•

the wake of

in

closed out the issues involved

including July 14, 1959, and de¬

-

in

softness

agreements naturally were anxious
to have a part in the big
offering

One

Company—Analysis—Harris, Upham & Co., 120 Broad-

Roadway Express Inc.

(jointly);

from

prior to

tion.

'.way, New York 5, N. Y.

Also available is

Hutzler

of adjustment
current

operations averaged 95.7%.

de¬

23

$15,000,000 annually in the

a

Service Company of New
Mexico—Analysis—Loewi &
Incorporated, 225 East Mason Street, Milwaukee 2, Wis.

&

Corp.; White, Weld 4b

Co.; Kidder, Peabody & Co

lower interest cost to the corpora¬

Association Inc.—Analysis—Reynolds

Federal Paper Board Company.

Bros.

Eastman Dillon, Union Securities
& Co., (jointly); Leh¬
man
Brothers; Kuhn, Loeb & Co. and A. C. Allyn & Co.
Inc. (jointly); The First Boston

issue.

The debentures

-

able

h

& Co., 120 Broadway, New York; 5, N. Y. Also available is

.Inc.

Salomon

of

!Co.
-{

the

investment

company.

Public

.

and

Sept. 10.

<()il & Gas, and Smith-Corona-Marcliant.

on

underwriting

bentures

Marquartft Aircraft Company—Report—Dean Witter & Co., 45
Montgomery Street, San Francisco 6, Calif. Also available is

bulletin
Pitts ton

Co.

Purchasers will have the option

a bulletin on Douglas Aircraft Co.
Marquette Cement Co.—Memorandum—Robert W. Baird &
Co.,

|
I

&

Kuhn, Loeb & Co., and American Securities
Corp.
(jointly). (2).For any preferred stock—Merrill
Lynch,
Pierce, Fenner & Smith; Salomon Bros. & Hutzler and

and this meant

of

Street, Boston 9, Mass. Also in the same circular are
sbrief analyses of Chicago, Rock Island & Pacific, Shamrock

-

rities

tal free from existing operations.

.

York—Bulletin—Laird, Bissell & Meeds,

| Massachusetts Protective

industrial

an

until

Wisconsin Public Service
Corp.
March 4 it was announced
company plans to sell about
$12,500,000 of new securities in the last half of the cur¬
rent year.
The type of securities has not
yet been
decided on.
Underwriter—To be determined
by com¬
petitive bidding. Probable bidders:
(1) For any bonds—
Halsey, Stuart & Co. Inc.; White Weld & Co.; The First
Boston Corp.; Kidder,
Peabody & Co.; Merrill Lynch,
Pierce, Fenner & Smith; Eastman Dillon, Union Secu¬

syndicate of commercial banks in
Canada and the United Kingdom.

by

expected

industrial bond

"

31 Milk

'j

two

Corp. Offering—Not
early in 1959.

or

largest ever formed to par¬
ticipate in the distribution of an

120 Broadway, New York 5, N. Y.
International Nickel Company of Canada
Limited—Analysis—
i
Baker, Weeks & Co., 1 Wall Street, New York 5, N. Y.
.Louisville & Nasliville-L-Data—du Pont,
Homsey & Company,

\

the

Smith,

(jointly);

Boston

1958

the

♦

•

with

First

late in

a

States,

The

current issue

,...

1

being negotiated between

cooperation

made

'

.

The

*

Films—Report—Van Alstyne, Noel & Co., 52 Wall Street,

New York 5, N. Y.
Hanover Bank of New

&

/ A
new
issue
of
$300,000,000 in the first half of the year total
United
States
Steel
Corp.
4% more than $1 billion.
sinking fund debentures due July
Total revenues of the
corpora¬
15, 1983, was placed on the market
tion for the latest calendar
year,
yesterday (July 16) by an under¬
1957, were $4,413,800,000 and net
writing group headed by Morgan income was
$419,400,000. For the
Stanley & Co. and comprising 301 three
months
ended
March
31,
investment firms. The debentures
1958, when ingot operations aver¬
were
priced at 100and ac¬ aged
54.1%, total revenues were
crued interest to
yield approxi¬
$800,100,000 and net income was
mately 3.97% to maturity.
$62,400,000, compared with $1,The issue..will rank
among the 166,500,000 and $115,500,000 in the
largest debenture offerings ever like period of 1957 when
ingot

&

Letter"—Amott, Baker & Co., Incorporrated, 150 Broadway, New York 38, N. Y. Also in the same
issue are brief reviews of Safeway Stores,
Inc., Consolidated
Edison Company of New York, Ketclium & Co. Inc., and
Guild

Oil

Inc.;

$300,000,000 U. S. Steel Debentures Marketed
By Morgan Stanley & Co. and Associates

of "ABC "Investment

-*

in

banking firms and

Corpora¬
tion, National Cash Register, D. S. Kennedy & Co., and Eitel
McCulIough.
-

;

Humble

Light Co.

and Robert W. Baird &
Co., Inc. (jointly);
Equitable Securities Corp. and Eastman
Dillon, Union
Securities & Co.
(jointly); White, Weld & Co., Kidder,
Peabody & Co. and Salomon Bros. & Hutzler

'

gram a short-term credit is

government

V,

States Natural Gas Co.

of

&

announced that company plans to issue

$10,000,000 of first mortgage bonds. Proceeds—

Barney & Co.

Venezuela (Government
of)
July 1 the Government announced that
Kuhn, Loeb &
Co. and
Kidder, Peabody & Co., both of New York, have
been selected as
financial advisors to develop a financial
program for the
country. As a first step in the pro¬

—

Three

shares

Power

was

To retire bank loans and for
construction program. Un¬
—
To be determined
by competitive bidding.
bidders: Halsey, Stuart & Co.

company plans to market
$30,000,000 of common stock in the latter part of
this year or in the first
quarter of 1959. Proceeds—For
construction program.

Anderson, 661 Broadway, New York 6, N. Y.
General American Trasporlation— Data
Alfred L. Vanden
Broeek & Co., 55 Liberty Street, New York 5, N. Y. Also in
the same circular are data
on U.
S. Freight Co., American
Express Company, Ampex Corporation, Dictaphone

:,

four

amount of the

Probable

about

Federated

Corporation—Analysis in

for- each

The

neighborhood ol$25Q,^

derwriter

company

Union Electric
Co., St. Louis, Mo.
March 28 it was announced

*

Great Western Financial

and sell

Kidder, Peabody & Co., New York.

Royal Bank Building, Toronto, Canada.

:

Inc.;

L

Richardson & Sons, 173
Portage Avenue, East, Winnipeg, and

.

that the

credit.

is in the

previously incurred.

Wisconsin

★ Thiokol Chemical
Corp.
July 14 it was reported that the
company plans a rights
offer to stockholders on
a l-for-10 basis.
Underwriter—

Recommendations & Literature
Stores—Memorandum—Green,

.

agent for the

financing involved

March 17 .it

(New Jersey)

announced

Refining Co. stock.

Dealer-Broker Investment

Department

/

& Co.
• '*

plans early
registration of approximately
10,850,000 shares of capital
stock (par
$7), now authorized but unissued. The com¬
pany contemplates issuing
approximately five shares of

8

page

Halsey, Stuart

will

the fiscal

000,000. The purpose is to restore government
balances,
which have been reduced
by the repayment of excessive
short term obligations

Com¬

—

Standard Oil Co.

the

.

Continued

issue.

3fr

syndicate

Bank, The First National City
York, and Bank of America National Treat
Savings Association. The Chase Manhattan Bank

new

—

500,000, and an increase in preferred stock from 25,000
shares to 50,000 shares. Proceeds
For repayment of

short-term

be

.

$110,000,000 of
Proceeds
To refund outstanding
To be determined
by competitive

35-year debentures.

tive

&

mission authorized the
company to issue

bidding. Probable bidders:
Morgan Stanley & Co.
•

Underwriter—For bonds to

;

Southwestern Bell Telephone Co.
0/30)
July 10 it was announced Missouri Public Service

to head this

are

Bank of New

•

April 15 it was announced that the Compaq plan to
market $6,500,000 in bonds or preferred stock
'cometime
this summer.*;'
The stockholders on
May 21 voted on'
authorizing; an increase in bonded indebtedness of $6,—

The three institutions which
are The Chase Manhattan

se¬

t

Largest bond issue is Washing¬
ton Water Power Co.'s $15

offering due

up

nesday, the

same

Tail Power

Co.

for bonds

is

million

on

Wed¬

day that Otter
slated to open

bids for $9 million bonds.

Biggest stock offering
Tennessee

Gas

on

tape is

Transmission's 1,-

084,054 shares of common, slated
for

offering

there is

a

on

Thursday

change in plans.

unless
■

*

-

The Commercial and Financial Chronicle

40

..

.

Thursday, July 17,

1958

(236)

W icsenherger States Mutual FundsJust Beginning Biggest Growth

Wellington Fund
Sets Sales Records
"

Fund sales for the
months of 1958 were
more than $6,500,000 higher than
for the same period in 1957, ac¬
Wellington

"Mutual

six

first

On

in the

This trend was climaxed

the

is

which

million,

$9

over

1958

30,

June

on

are

$6,514,000
comparable figures

Increase

;

ere:

—

June

V *

.

ence

but the most

amending 22D in

edition

work,

the practice of i assembling groups of purchasers to obtain
quantity discount prices. Action to discourage these practices has
been suggested by the National Association of Investment Compa¬
nies and the National Association of Security Dealers.
Another factor which will be, and has been considered, is the

every

by

as

.

Investing Up 20%
of

sales

of

shares

new

its

well

annual

contains

the

and

records

on

21

as

and

open-end

investment

company,

29-year

gain

the

with

contrast

obtain

a

quantity discount.

,

readily available to the public. Different plans arp being con¬
so that if there is a default the securities will have been
escrow and the discount will be substracted before delivery
is made to the purchaser.
In general, the amendment of Section 22 (d) will be of bene¬
fit to the industry and to the general public due to the fact that
there will be less chance of discrimination in the distribution of
shares of investment companies.
v;';?'y"-;. r V

in

have

met

well-deserved
that

•

some

of

with

public

June

shares by stockholders
to $259,597.

As

per

al

1958 equal to $16.44

30,

share. This compared with net
of
$151,006,754, equal to

assets

result, net new money invested $17.65 per share on June 30, 1957.
month The June 30, 1958 asset value of
$16.44 does not include the 56
Of June increased by about 40%
cents per share capital gains dis£

In the mutual fund in the

to $951,330.
In

tribution paid in

making these figures avail¬

"On

December, 1957.

1958," the report
able, Mr. Fox-Martin commented continued, "Chemical Fund comon the fact that the gains for this pleted its 20th year of operation,
Since its organization, net assets
established mutual fund in June
of

July

7,

increased from

have

the Fund

especially significant in view $100,000 to $153,886,575, and net
of the large sums of money in¬ asset
value
per
share has invested in the shares of new mutual creased from $5.00 to $16.44. In
addition, $4.43 per share has been
funds
offered
by
underwriters
distributed from realized net cap-

during the past month or so.

ital gains. Dividends

of

Nation.
Investment

titled

Association

the

elite

the

of

"Planning

paid from net

is

VOOfllitt

Incort
rporoted
Investors

for
FUTURE

I

INCOM1?

I

Wffi&mm

and

ihfwW 1925
MUM 1925

inv«»tad in a

mutual fund

A

list of (ocuritio* foloctod for
poiJblo orowth of capital

and
XffiWZWfM

incoma

tho

in

commenting

years

«b*ad.

F.

Francis

,

on

Eberstadt,

the

Fund's
Chairman,

Williams, Presi-

S.

that

products
efficient processes developed through research have
been an important factor contributing to the Fund's investment
performance during this period."

dent,
and

stated

"new

more

Turning

to

current

and

outlook,

Messrs.

and

Williams

noted

operations

Eberstadt
that

"596

manufacturing companies reported
A

mutual

obi.ctiv.it
-rr.nt

">• ruk

fund

whoso

to r.turn
as

fncom.

„

first

large

may

£

an

average

decline of 35%

in

net income for the first quarter of

1958,

compared

with

the

same

quarter of last year." By compari-

Chemical

Fund's Portfolio
reported average decreases of 17%, in income for the
same period.
Most of the pharmason,

companies

involved.

ceutical companies and the chem-

ical process
A

prospectus

on

each

fund is available from
your

investmen t dealer.

The Parker Corporation
200 Berkeley Street

Boston, Mass.




companies producing
consumers'
goods
continued to do relatively well.
Chemical
Fund's
management
non-durable

./

•

,

mutual
foothold in
this
country,
the industry has
passed through two major stages,"
"Since

the 1920's, when

funds really gained a

the

errors

trials

that

important

and

must
new

upon

the

occasional

accompany

concept.

consolidation

building

with

establishment,

inevitable

the

"First, its

financier observed.

original

and

any

Second,
confident

experience of

the

the past.

Houghton Fund A, front $4.78 to

$5.17;

17lllir|
frBiifcmu
A 11*1*1 OcllCo VjD III

tdund

Kalb, Voorhis & Co. has inaugurated the first of a series of

The first class

In

Axe-

follows:

ahead

way

n

comprehensive courses devoted to
the selling of mutual fund shares,

growth,

as

life

its

of

of it.

T UUlliia KjU*

from $.109

share in 1939, the
first full year of operation, to $.40
per share in 1957.'

increased

much

has

#

li Mill

investment income have increased
per

also

gether, they place the "seal of-,
approval" on mutual funds as an
investing way of life which still

"The third stage—the expansion
certain to take place
once the
Axe-Houghton
Fund
B,
from $6.73 io $7.62; Axe-Hough¬ original concept has been accepted
This latest piece of literature is
ton
Stock Fund, from
$3.28 to —has barely begun. The next 10
jn handy pocket form and states
$3.62; Axe Science & Electronics years will see a growth of the
the
advantages
of
the
mutual
investment company idea far be¬
Corporation, from $9.06 to $9.93;
funds, as well as giving informayond the wildest imaginings of a
tion on how to choose a fund in Axe-Templcton Growth Fund of
mere 10 years ago. This growth is
accordance with individual needs. Canada, from $18.54 to $22.27.
already strongly in progress—and
Single
copies
can
be
obtained
Shareholders on June 30 num¬ it is firmly rooted."
from the National Association of bered
During the 18 years in which
90,744—up from 89,142.
Investment Companies, 61. Broadway, New York 6, N. Y.

Companies

Your Future With Mutual Funds."

ceem

[investing

a

so
much research facilities and long-estab¬
acceptance lished worldwide connections. To¬

Assets

Passes and issued by the

$153,886,575

totaled

assets

Net
on

Investing

firms

ing

chapters providing within

Up 17 Percent

2)U stockholders.
stockholders''*1

dales, redemptions of Broad Street
declined by 21%

that other great

information

High

In

there is no doubt
Wall Street bank¬
will enter the field
very short time."

old history—and

forts

many

Chemical Fund

'

more-than-a-century-

its

in

fund

This development, Mr. Wiesen¬
about
mutual
funds
in
general, their berger feels, marks the coming-ofuses
and their integration with age of the mutual fund idea. "On
insurance and with other invest¬ the one hand, there is the con¬
ments.
stantly increasing use of invest¬
"Many prominent firms have ment companies by the1' gehferal
long been an important part of the public," he pointed out, "on the
mutual fund picture," Mr. Wiesen¬ other, the establishment of new
berger went on. "They have done companies backed by firms with
an outstanding job,
and their ef¬ considerable resources, extensive

complete

Investing Corp., a
Axe Fiuid
old /diversified mutual
fund, were up 20% from the May
months ended June 30, 1958, in¬
level, it was reported by Milton
,
cluded an increase in drug, pulp
Fox-Martin, President of Broad
Total net assets of the five mu¬
and
fStrcet Sales Corp., national dis¬
paper,
and corn products'
tual funds sponsored by Axe Se¬
tributor of shares of the Broad
Net Assets at
holding while
oil and
general
curities
Corporation
rose
more
jgtreet Group of Mutual Funds.
chemical holdings were reduced.
than 17% in the first half of 1958.
The
54,834 new Broad Street
Record
All five funds participated in the
Investing shares sold during June
New Booklet
advance which, according to pre¬
added $1,210,927 to the assets of „ Chemical Fund's net assets on
liminary figures, lifted the total
this $100 million investment com¬ June 30, 1958 were at the highest
Is Available
from $128,513,978 on Dec. 31, 1957
pany.
This compared with $1,- level of any quarter-end in the
to $150,639,276 on June 30, 1958.
<010,529 in May and made June Fund's 20-year history, according
A
new
booklet, just off the
Asset value of the funds' shares
the best month for 1958 to date. "
Street

Uroad

man

refer¬

book

important

closed-end

instances there has been the intent to purchase over a
period of time a fixed number of shares but at a later date there
has been a default in the securities purchase program.
In the

Broad Street

June

banking houses. Leh¬
Brothers
has
launched its

"Investment

$25

,

•

just published the

of

data

meantime, the discount had already been given and thus here
again there becomes a benefit to the defaulter which would not be

June Sales of

'

best-established

oldest and

of the

new
One
William
Street Fund'
Compa¬ with noteworthy success — Lazard
nies," recognized as the "bible" of Freres has just announced its
the
mutual
fund
industry. The sponsorship of the first mutual

18th

essential

filing of letters of intent in order to

$2,031,000

—

this investment medium by many
investment

Company.

384-page,

In

Increase

&

held in

$9,036,000
7,005,000

June 1958

begun

now

to look upon

sidered

1

June 1957—

Exchange

Wiesenberger

Arthur

of

regard to the discount is the belief that there has been some dis¬
crimination to the public and investment company shareholders
'

The

various exemptions from Section 22D

Stock

York

New

firm

understood that this proposed rule will cover

important is the discount on quantity orders.
The reason for the recommendations for

$53,533,000
47,019,000

1957

the

The firm has

It should also be

follows:

1958

2718

No.

on

letters of intent,

as

releale

issued

offices.

were

comparable six months fig¬

The

Commission

companies.

$709,642,000.
ures

the

1958,

28,

quantity orders of securities of registered investment
Oral argument before the Commission on the proposed
rule will be held on July 23, 1958 at 10 a.m. in their Washington

discount

highest total for any June period
in Wellington's history.
Total assets of the Wellington
Fund

May

inviting all interested persons to submit comments on its proposed
Rule N-22D-1 relating to permissible variations in the sales load

by gross sales of

June

of

month

already experienced a phenomenal

SEC Reviews Quantity Discount

Wilkins, Vice-

J.

A.

cording to
President.

have financial world have

which

funds,

mutual funds as "the
expansion in the United States v/ave of the future," better geared
serve
tomorrow's
investors
during the less than four decades to
of their existence, are now on the than anything else yet devised.
"The industry as a whole is now
threshold
of
infinitely
greater
significant
changes,
achievement," according to Arthur undergoing
Wiesenberger, senior partner of v/ith the increasing acceptance of

By ROBERT R. RICH

was

Massachusetts Investors

held in Wash-

Growth Stock Fund

ington, D. C., attended primarily
by salesmen currently engaged in
mutual fund selling and a few

who

are

just entering the field,

A variety of dealer firms, in¬

Massachusetts Investors Trust

eluding firms in the middle and
far west, have enrolled salesmen
in the courses which are being
conducted by Ray Jacobs,
Successful
completion
of
course

involves attendance

at

Century Shares Trust

the
10

three-hour meetings. In Washington seven classes are being formed
f°r the month of July.

Canada General Fund
LIMITED

Some will

be held alternate evenings; some
on alternate afternoons.
It takes
three weeks to complete the
on this basis, but accelerated courses are available to those
desiring to attend both afternoon
and evening meetings for one full
week.
Tuition for the complete course
is $200 and those who attend all
sessions, or make-up sessions, and
pass the quizzes and
classroom

course

exercises are awarded certificates
of completion,
has continued to emphasize selecAfter the completion of the
tion of investments in companies courses in Washington the classes
serving the non-durable consum- will be offered in other large
ers' goods field.
More than half cities.
Currently it is Kalb,
of the Fund's net assets are now Voorhis' plan to conduct the sesinvested in such companies. Major sions in New York City starting
portfolio changes during tne 12 Sept. 8.
,

Bond Fund
OF BOSTON

A prospectus

relating to the shares of any of these separate
be obtainedfrom authorized dealers er

investment funds may

VANCE, SANDERS & COMPANY
111

DEVONSHIRE STREET

BOSTON
miw

Al Broadway

I
loi anoilis

CHICAGO

york
tlo

South LaSalle Streot

Bio

Wot Brroath &tr«a«

Volume

188

Number

57C0

.

The Commercial and Financial Chronicle

.

.

(237)
the

Wiesenberger ■ firm* has pub¬

lished

its

annual

editions

of

Inventory Buildup Seen Sparking Business Recovery

"In¬

Business

vestment

Companies," the mutual
fund
industry has
seen
many
changes,
as
has
the
American
have
the

naturally

been reflected in
Among the important

book.

material

new

added

to

the

latest

"The stock price
averages, which months ago anticipated the
recovery, have seen their 1958 lows but not their highs," National
believes.

edition is

a section devoted to life
insurance and its integration with
investments.
It
shows
how life

insurance

can

employed

by

vidual

the

his

needs,

A-

true
■

industrial

indi¬

investor

,

,*■>

Cites Increase

National" Shares

Corp.,

-

closed-

and-

an

extra

holding

dividend

seen

With

regard to

the railroad industry, National believes the
carriers have at last made some inroads in
convincing the public

and the Congress that they deserve

legislation affording them

of

more

enacted.

more

consideration, and further

equitable treatment is likely to be

.

4 cents

payable July 15, 1958. This
compared with an asset value of
$19.93 per share on March 31,

Total construction
home

other

1958 and $24.61 per share on June

30,

1957.
There
are
shares of capital stock

ing-

V

outstand¬

of, total
bonds.
8.3%;

assets;;, corporate
U.

S.

Government

and

obligations,

receivables

(net of lia¬

bilities), 3%; and preferred stock,
6/10 of 1%.

Changes in holdings of

common

stocks

during the three months
ended June 30, 1958 included new
purchases of 4,000 Crown Cork
& Seal and 2,500 Penn-Dixie Ce¬
ment.

Holdings of Royal Dutch
Ingersoll-Rand
and

Petroleum,
American
creased

Natural

and

Gas

those

in¬

were

of

General

Dynamics and U. S. Plywood

were

sold.

"

..

U. S. and

of June

as

Foreign

standing.
assets
per

Dec.

The

out¬

This compares with net

of

share

$103,599,326
on

$103,456,893
on

stock

common

31,

$31.29

or

M.

quarters in New York City to sell
an
investment program in the

March

31, 1958 and
or
$31.25 per share
1957.

June

30, 1958 asset value
was after deducting two dividends
of 40 cents per share paid March

new

growth

banner

all-time

fund

the

result of

The fund is

and

its

group
This

of
re¬

now

-

vehicle

for regular

the

mutual

new

the

and

and

of

Television and

charle5 E. SaHk

stations,

is the sponsor for the Electronics
Investment Program for the ac¬
cumulation of shares in the Elec¬
tronics

Investment

million

mutual

Corp.,

a

investment

$16

fund.

Back in

1954, Mr. Salik, an elec¬
tronics engineer, decided that the
electronics industry could be an

;

people

as

investing

Classes

of

common

stocks held

June

30, 1958 represented the
following
approximate
percent¬
ages
of
total assets:
Oil, 44%;

of

a

mutual

mining

added

Abbott

Laboratories

Food Fair Stores

to the

holdings

have

Aluminium,

American / Metal
been eliminated.

and

portfolio.
been

Ltd.

Climax

in¬

and
have

Mr. Salik selected for his board

drug 16%; metal and of directors specialists in elec¬
10%; manufacturing and tronics, investments and business.

2%; natural gas 2%; and mer¬
chandising 1%. U. S. Government Advisory
obligations amounted
and cash .98%.

Common wealth's
New Fund Reflects

16.44%

•

•-

.

tive

Committee,

Corporation's

of these

operations is Peter
Executive Vice-Presi¬

J.

compared with
of $21.71
the

Anti-Cy clicalTren d
S. Waldo

Coleman, President of
American
Securities
Co.,
investment managers of the Com¬

North

monwealth mutual

funds, said

on

per

in

The

our

three

appointed
Board

Technical

a

of

nationally

cost of securities

U.

S.

purchased, other

Government

Three

of

the

proceeds from securities sold

amounting to $5,187,110.
Common Stocks in the corpora¬
portfolio had a value of

tion's

$210,973,839, or 92.6% of
as
against $190,516,296,

during the present wide¬

American

economy

over

longer

■

.

shares

Babcock

shares

-

T.

fund

devel-

Fund

Rowe

with

They

Price

officers
are

Growth

open-end

an

objectives of this Fund
are
possible long-term capital
and
income
growth for its shareholders.

in

tive

Association:

Great

2.900

Northern

West

shares

Paper;

4,000

Virginia
shares

7,000

shares

Signal

vania

Power

&

Light, and 3,800

Mr. Perkinson is Vice-President

upon

icals

and

Mr.

common




•

_

Los Angeles

General

were

which is primarily

stock

ized in 1950.

there
—

is

Department of E. I. duPont

This Fund,
a

Atlanta

Davis

de Nemours & Co.

request

Lord, Abbett & Co.

ZZossible growth of pnnapal.
Commonwealth Stock

JFund,

tary and Director of U. S. Rubber

Manager of the Grasselli Chem¬

fund,

was organ¬

As of June 30, 1958

3,026 stockholders and

net assets totaled

$11,909,093.

I
i

° ESS

&

shares Public Service of Indiana.

inQ

cnnWTH'

Oil

Gas "A"; 5,000 shares of Pennsyl¬

Stock

n

&

Oil;

38,000 shares International Petrol¬
eum;

mutual

Cyana-

11,506

Pulp

Barber

wm(SPfl

Co., Mr. Dougherty is Secre¬

share's

Paper;

P»

Baltimore,

4,600

3,000 shares Massachusetts Protec¬

Dougherty and Clark

'

—

91.2%

or

Broadcasting;

Lewis C. Perkinson,

and Director of American

Co.,
Common Stock Investment Fund
Investment

■ -

net assets

Wilcox;

Columbia

members have been

new

Fund, Inc.,

mid

Chicago

Obliga-r

tions, amounting to $6,647,518, and

elected to the Board of Directors

Md.

new

Affiliated

—

value

share at the end of

W. Davis.

New York

asset

six

This

During the quarter ended June
30, 1958 the corporation purchase^
portfolio securities on balance, thei

Names Directors

prominent electronics experts who

Prospectus

the

30, 1958.

net

a

Lehman

for

previous quarter and $20.76
share at the end of 1957.

Growth Stock Ftl.

William M.

A

■>

'

report

months ended June

than

occurred

inform the directors of

to

.•

per

Today, Charles Salik, through
ly publicized recession. It is an
newly formed Fleetwood Se¬ indication that
more
and
more
curities
Corp.
of
America,
is men and women of moderate and
teaching modern
selling
tech¬ larger
earnings see the diversifi¬
niques of presenting the story of cation
offered by mutual funds as
electronics growth to the public.
a
means
of participating in the
Chief

ment fund, Electronics Investment

also

■

Total net assets of
accumulation plan. There
$227,121,998,
over 900
regular partici¬ equal to $23.69 per share, was an¬
pants in this_ plan wfr&h jiyas nounced jointly by Robert Leh¬
started in 1956.
man,
President, and Monroe C.
/In recent months there has
been Gutman, Chairman of the. Execu¬

his

Corp.

He

.

der the

invest¬

chemical and

miscellaneous 7%; electric utility

Reports Increase
In Net Asset Value

a

un¬

Corp.

are now

T. Rowe Price

form

Lehman

1955.

.

the

share

paid from invest¬

fund, six months
New additions to the portfolio
of operation with total
Investment Corp.,
shown by the report were
50,000
net assets of over $5x/2 million as
Today, the fund is
shares of United States Steel; 10,solidly established, having more compared with $100,000 when the 000 shares Eastern
Industries; 10,than 20,000 shareholders in the 48 fund began last year. One reason
000 shares Haloid Xerox
Inc.; 71,for this growth is that the invest¬
states, Alaska and many foreign
500 shares Texas
Company, which
ing public is showing what might
countries.
was received in
exchange for 71,be
called an increasingly
anti500 shares of Seaboard
"Only 6% of Americans invest
Oil, and|
cyclical
attitude
in
relation
to
in all phases of the securities mar¬
15,000
Arizona
Public
Service.
ihcir investing programs."
Other
ket," Mr. Salik said in 1957 when
purchases
included
5,000
Mr. Coleman explained, "Pre¬
shares Ideal Cement; 5,000 shares
addressing a group of securities
dealers at a mutual fund conven¬ viously, during other downward Trane
Company;
10,000
shares
tion.
"Our job is to convince at swings of the economic pendulum, MacMillan &
Bloedel, Ltd. "B,"
least 50% of our adult population investment purchases usually fell and 5,000 shares of Mead Johnson
off, too. However, the rapid growth Co.
of the advantages of
being part of
Commonwealth Income Fund
owners of American
industry."
Among the sales were: 15,000
back in

lik, San Diego

in

each have been

During
operation,

per

funds, Commonwealth Income three months
earlier.
Fund, has just completed its first

in

net*

the

ment income.

owned

business

that

the first six months of
two dividends of 10c

by close
6,000 shareholders in virtually
every state in the country.-Aber¬
deen is becoming an
especially
popular fund for young profes¬
and

states

per share had risen
initial figure of $7.36 and
as of Nov. 30, 1957, to $8.17

$7.41,
share, May 31, 1958.

to

sional

report

an

per

appreciation of

the portfolio securities.

Co.^j

North

value

from

in¬

Piper,
31 and June 30,
periods of time, regardless of how
aggregating $2,- excellent investment medium for dent, who assisted Mr. Salik
in
of
648,652.
Of
each
average
income.
payment
15 Americans
the pendulum may swing in short¬
forming
Electronics
Investment
cents per share was from net or¬ Convinced of the continuing
Corp. in 1955.
er intervals."
dinary income and 25 cents per growth of electronics, Salik de¬
Mr. Coleman is recognized as
share from net realized
he
would
do
something
capital cided
about it.
His plans materialized
one of the pioneers of the mutual
gain.
on

The
asset

redeemed, while 60% of the gain
was

Securities

the Electronics

by

operator

a

in an
underwriting syndi¬
selling $10 million worth of

stock

Charles E. Sa-

financier

to

the

American

American Securities Co.
currently

October.

of

report
supervised by

July 7: "The newest of

—

America,

owner

electronics

future

leading brokerage firms.

last

40%

fund,

new

months

is

surpervises more than $145,000,000
in investment company
assets.,

27% from the

reached

six

it

sulted

the

of

of

dynamic

story of the

up

relatively

first

cate

1 ectronics!

Radio

Mr. Salik told the

grow¬

ing industry in

Under

Pettit, Professor of Electrical

Henry P. Kalmus, Electronics Re¬
search and Development Scientist.

A group of prominent Californians has just established head¬

America

Technology; Dr. Joseph

Engineering, Stanford University;

Fund Sales

fastest

Professor, Massachusetts In¬

per,

stitute of

Electronics

headed

30, 1958, equivalent to
share on the 3,310,815

of

Corp. to Sponsor

of

closed-end investment companies,
reports net assets of $110,758,229

shares

Fleetwood Sec.

this group,

United States & Foreign Securi¬
ties
Corp.,
one
of
the
larger

$33.45 per

opments, inventions, and changing
trends in the electronics
industry.
They are Dr. Charles Stark Dra¬

Fleetwood Se¬
curities Corp.

Net Asset Gain for

in

creased.

e

a

Al¬

ganizations in the country.

due to the net increase
shares sold over shares

Several

i.";

;■
<
..' ■- " '
Common stock held at June 30,
1958 represented 88.1%
•

•

cash

activity is seen establishing a new. record as
building and stepped-up programs for highways, schools and
public facilities more than offset the indicated decline in

industrial construction.

1,080,000

point

are

Approximately

up

..

by Dominick & Dominick, reports
net asset value of $21.66
per
share on- June 30, 1958 after de¬
ducting dividends of 12 cents per
a

,

■

Government spending
moving slowly upward. "Owing to the complexity of
modern military
technology it takes time to get the new space-age
weapons into production, but once the production
stage is reached
there will be startling increases in
expenditures with inflationary
implications."
; <"

end investment company
managed

share

managers feel.

ditures for services and non-durable
goods.
is

Net-Asset Value

represents

America.

in

of the oldest management or-*

one

peak in asset value for the fund.
Total assets

its

a

issued,

North

crease was

ahead," the fund

good position to
;

well and with the $1.5
going to government employees, the investment
company expects new highs will be achieved in consumers'
expen¬

m

High

dividend declaration.
This

is

with

$10,564,425 and $10,511,491 after latest

low

Personal income has been
billion pay rise

National Shares

*

As of June 30, 1958 the assets of
Aberdeen Fund amounted to

move

can

V"'v':

,

recently returned from a series of visits to key
and the report indicates that
expected stepped-up

Fund

just

All-Time

sales early in the fourth
quarter will result in significant inventory
replenishment. "Steel, petroleum and other major industries that
have worked off excessive
inventory are now in a

insurance

"

areas

movement

though the Commonwealth Income

Assets Reach

Staff members

effectively

average

how the

and

determine

be most

fund

Aberdeen Flllld

is

year

ended National Securities & Research
Corp. believes "An unmis¬
takable recovery will be evident." This
opinion is expressed in a
special mid-year report prepared by the investment
company
which sponsors and
manages the National Securities Series of
mutual funds with assets
exceeding $325 million.

generally. These changes

economy

activity is heading upward and before the

41

-

42

The Commercial and Financial Chronicle

(238)

The following statistical

Indications of Current

latest week
week

Business Activity
Latest

Week

AMERICAN IRON AND STEEL INSTITUTE:
Indicated Steel operations (per cent capacity)

Week

month ended
Month

that date,

on

Steel

Ingots

—July20

castings (net tons)—

and

ALUMINUM

Revenue

Revenue

6,723,000

6,775,000

186,486,000

193,025,000

23,855,000

22,344,000

106,571,000

103,353,000

93,037,000

119,592,000

64,772,000

63,697,000

62,810,000

46,248,000

457,661

626,573

612,715

of

523,114

495,052

;

$505,535,000
200,577,000
304,958,000
196,178,000

90,016,000

5
5

1,240,000

8,930,000

7,775,000

1,474,000

65,000

571,000

388,000

69,000

5

102

*110

135

101

July
July

INDEX—FEDERAL RESERVE
= 100—
—-—July

—•—

-—-—

458,151,000

111,090,000
214,375,000

DEPARTMENT STORE SALES

AVERAGE

—

—

11,851,000

*11,210,000

12,109,000

July 10

INDUSTRIAL)

'

275

292

254

256

5.967c

5.967c

5.967c

METAL PRICES

—July

,

refinery

Stocks

8

$66.49

$66.49

$66.49

Zinc

end

$36.50

$35.17

$35.50

$54.50

tons)

North

To

Europe
Asia
South

28.775c

.

-July

24,050c

23.800c

22.850c

July

11.000c

11.000c

11.000C

July

10.800c

10.800c

10.800c

13.800c

July
July

10.500c

10.500c

10.500c

10.500c

10.000c

10.000c

10.000c

10.000c

Adjusted

July

24.000c

24.000C

24.000c

25.000c

Without

July

94.000c

94.375c

95.125c

Aaa

at

*

-

—

——

14.000c

period

_i

66.967

4,962*713

71,018
51,519

252379

—i_

,

69.957'

240.67Q

1

133,455)

90,719

-

"

-

,

'

anthracite
116,990

Central

(net

America

(net

129,603

tons)
j.

=

81,556

102,520

45,296

248.673-

2,729

tons)

America

362,198

60,789

53,355
2,846

tons)

tons)

(net

11,005

22

•

ELECTRIC

96.54

92.50

101.97

103.13

96.54

Revenue from ultimate customers—month

99.52

99.68

94.56

96.07

95.92
88.27

97.31

99.20

92.06

90.34

97.62

97,78

ultimate

of

100.00

FABRICATED

93.38

99.52

93.52

3.12

3.12

2MB

customers

CAN

3.98

3.97

4.24

3.63

3.56

INSTITUTE

46,702,575

45,671,071

$751,689,000

55,34B,*655

$797,337,000
55,289,179

at Apr.

3.78

3.77

224,308

208,161

328,180

323,574

331,227
377,304'

24.298c

30.334c ;

SO-

4.00

4.01

4.19

-——July 15
—July 15
July 15

HI!I—IIIII—IIIII III
_

-

4.29

4.51

4.51

4.54

4.27

4.27
3.89

4.18

■

3.78

3.75

396.7

399.0

429.0

(E.

M.

&

July
July
—

5

July
July

Production

5

5
5

391,454

229,248

refinery

193,815

248,617

238,939
158,025

61

89

77

304,529

356,484

404,015

"

109.99

109.79

y

.

New

"

Silver and Sterling Exchange—

>

11.024c

.

June 21

1,698,500

1,706,210

1,594,440

1,544,090

June 21

375,540

Other sales

June 21

1,367,950

356,480
1,290,360

349,040
1,243,410

June 21

1,743,490

1,646,840

1,592,450

277*620
1,220,100
1,505,720

June 21

429,240
39,500

415,170

253,850

—-June 21

409,710
42,650

37,200

20,300

June 21

332,100

385,260

351,400

268,600

June 21

374,750

424,760

388,600

288,900

June 21

573,030

535,542

562,635

195,760

93,460

591,156
786,916

735,066

Other transactions initiated off the floor-

Tin,

Straits—

York

New

'

'

129,990

—June 21

667,046

610,562

June 21

—

797,036

779,882

June 21

-

Other sales
Total sales

Total round-lot transactions for account of members—
Total, purchases

June 21

2,681,240

June 21

548*180
2,367,096
2,915,276

Short sales
i

June 21

June 21

2,686,230
565,300
2,286,182
2,851,482

641,606

2,545,152
2,185,966

2,529,686

78.283d:
$2.79024
98.060c

$35,000

$35,000

$35,000
$228,120

32.590c

32.590c

29.000c

$255,000

$229,231
29.000C

36:590c,

*

33.000C

*

ounce)__;

refined (per. pound)
I—
tCadmium
(per pound)___
SCadmium (per pound)
Cobalt, 97%.. grade
_•
—aZ
Aluminum,
99%
grade
ingot
weighted
average (per pound)
i_
Aluminum, 99% grade primary- pig———
Magnesium ingot (per pound)—.—

29.500c

33.500c

$67,000

refined

29.500c'

-

$68,154

$92,000

$1.55000 r.
-

$1.55000

$1.55000

-

$1.70000

.

$1:70000

$1.55000

•

$1.55000

$1.55000

$2.00000

$ 1.70000;

$2.00000

'

26,100c
'

$2.00000,

26.100c

24.000c :

Y4(000c

35.250c

w

,

27.100ci

35.250c

-

' 25.000cj

_

35.250a
*

2,138,306

2,767,966

-

*

391,380

90,456c

,

94.563c

94.665c
>

y

88.625c
76.101c*
$2.81572

$2.81111

—

2,360,575

582,000

-

£74.303

£73.868

•

f

'75.274d

....

550,780
169,320

10.860c5

£61.854
£62.262

'

88.625c

■>.
-

cz"

boxed Laredo

(per

£91.987

"11.360c

10.500c

•

£64.176.

__

(per. pound),

Platinum,
tCadmium,

£72.473
10.000c
•

£64.652

__

Antimony

1^120c

£91.688;

10.000c

-

Gold (per ounce, U. S. price);
j_
Quicksilver (per flask of 76-pounds)
([Antimony, New York boxed;.—
;
Antimony (per pound), bulk Laredo.—
-y

14.320c:

;

.

11.512c

£72.137

,

£74.155
10.500c

—

Short, sales

^

'

•

11.712c
-

£73.277

•-

Silver, New York (per ounce)—
Silver, London (per ounce)_1—__.Lj_i._i_
Sterling Exchange (check)

which registered-

£228,809

^

11.224c

-

—

,

28.410c;
£227.132'

£180,756

.■

St.

Zinc, (per pound)—East St..Louis
l~
§§Zinc, prime Western,,delivered (per pound)
ttZinc, London, prompt iper long ton)——
ttZinc, London, three months (per long ton)

*

£178,798
'

York

East

21.944c

23.670c

long ton)_!

—

110.22

TRANSACTIONS FOR ACCOUNT OF MEM¬
BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS:

Other sales
Total sales

( per

(per pound)
Louis (per pound)—'
[' ttLondon, prompt (per long ton)—;
ttThree months, London iper long ton)™

446,373

•'

;

£196,185

Common,

ROUND-LOT

Total sales

24.689c

£194,613

Lead—.

>

Other transactions Initiated on the floor—
Total purchases

'-'4

•

pound)
pound)—...

ttThree months, London

54

110.07

■'

-

(per

'

272,519
277,429

July 11

QUOTATIONS)—

Export refinery (per
ttLondon, prompt (per long ton)..
'

OIL, PAINT AND DRUG REPORTER PRICE INDEX—
=

J.

■■

Domestic

4.17

396.6

L_ *

———

Common,

NATIONAL PAPERBOARD ASSOCIATION:
Orders received (tons)

CONSTRUC¬

June:

4.71

3.80

STEEL

(

Copper—

4.39

3.90

.

3.92

July 15

MOOD Y'S COMMODITY .-INDEX

Total purchases
Short sales

54,219,919,

(AMERI¬

May:
tonnage)—estimated.'
(tonnage)—estimated

METAL PRICES

4.10

4.03

OF

STEEL

Of

closed

.Shipments

3.97

3.81

STRUCTURAL

TION)—Month

3.59

4.00

July 15
July 15

-

——

45,263,167

$776,596,000

85.98

92.06

Number

93.23

88.67

91.77

131 '

of

'

—

130

AWt

INSTITUTE—

-

April.

38T'

133

127

...

99.04

88.67

■

(tons)
Percentage of activity
Unfilled orders (tons) at end of period——.

134
_

101.64

15
July 15
—-—July 15

;

variation."

adjustment.

Kilowatt-hour, sales to ultimate customers—
Month of April (000's omitted),.

3.65

Short sales

seasonal

for

seasonal

87.36

-IIIIIIIIIIIIIIIIIIIIIII—IIIIIZII-II—UllllHIIIjuiy

Transactions of specialists in stocks in
Total purchases-:

STORE SALES—FEDERAL RE-

SERVE SYSTEM—1947-49 Average—100Month of June:
/

95.59

July 15

Government Bonds-

Average corporate

Other sales
Total sales

4,557,216

,

54*658'

;

—

(tons)

Pennsylvania

of

(net

Contracts

1949 AVERAGE

4,674,920

.

(tons of

,?,

pounds)-

(BUREAU OF MINES)—

and

DEPARTMENT

MOODY'S BOND YIELD DAILY AVERAGES:

Industrials Group

of

2,000

92.94

——July 15

—

-

Group
Utilities Group

.

96.38

July 15
.July 15

Railroad Group
Public Utilities Group
Industrials Group

Baa

•281,446*000
282,957.000
11,748,000 '1714,699,000

of

93.92

95.62

Public

'

/,

96.07

July 15
July 15
July 15
.July 15

"I—III————II—II——IIIII—IIIIII-IIII—

Railroad

260,824,000
5,341,000

Undesignated

EDISON

i

.

Aa

„

19,059,000

97.250c

at

Average corporate

Aa

*10,186,000 "

27.100c

—

MOODY'S BOND PRICES DAILY AVERAGES:
U. s. Government Bonds

A

17,934)000

—

To

24.500c

(East St. Louis) at-

U. S.

of

April:

of

25.175c

Aluminum (primary pig. 99%)
Straits tin (New York) at

Baa

a

exports

(net

$64.76

8

S.

25.100c

Lead

(delivered)

at

July

Export refinery at
(New York) at——
(St. Louis) at

272716,000

by 351

INC.—Month

output all grades

/tons

COAL EXPORTS

»

at

Lead

IZinc

smelter

To

QUOTATIONS):

(E. & M. J.

20.000

-

31,366,000

I

zinc

To

ton)

24,630.000

22^000"
'

_

INSTITUTE

-30,000

.

INC.

-

transported

226.231,000

y; 24,652.000

25,835,000

^

ASSOCIATIONS,

2,000 pounds)

Electrolytic copper—
Domestic

%

250381:000

194,472.000

^3,053*000

'

July

Pig iron (per gross ton)

6,972,091

219,146,000

188,631,000

(barrels)—

TRUCKING

Month

8

stock

June:

5.967c

'

July

—

9,391,402

f

4,372,971 "

211,714,000

(barrels)

—"

all

AMERICAN ZINC

U.

(per lb.)—

Scrap steel (per gross

output

of May:
•
general freight
carriers (In tons)!

11,964,000

DUN &

—

*6,301,15?
■

"5

—

oil

—Month

COMPOSITE PRICES:

Finished steel

-

Intercity

Slab

July 12

' '

rv

crude

Shipments

(COMMERCIAL AND

INC.

Ions

AMERICAN

INSTITUTE:

Electric output (in 000 kwh.)

*

INSTITUTE—Month

.

(barrels)

124,359,000

108,708,000

260,924,000

10

,—

,

(U. S. BUREAU OF MINES):
Bituminous coal and lignite (tons)—————
Pennsylvania anthracite (tons)

AGE

i '

4,649,499

production (barrels of 42 galeach);
—j—

Decrease

$325,465,000

197,227,000

$466,263,000
103,425,000
362,838*000
192,504,000
170,334,000

100,845,000

7,132,000

•

^

$558,996,000

166,324

castings produced

June

outtput (barrels)—
Benzol
output
(barrels)
L
Crude oil imports (barrels)—
Refined product Imports
(barrels)——
Indicated consumption domestic and export

.

—

BRADSTREET,

.

Domestic

522,615

10
10
10

119,059

176,069

INSTITUTE:

—:

PETROLEUM

April:

'.<■

•,

535,334

456,463

.—July
July
July
July

139,910

178.536

Natural gasoline

—July

.

Ago

Total domestic

COAL OUTPUT

FAILURES

of

of May

AMERICAN

of cars)—July

State , and municipal

IRON

STEEL

steel for

tons)—Month

Month

ENGINEERING

"

Public- construction—

EDISON ELECTRIC

AND

Year

121,980

r.

Feb.^

'

28,597,000

—July 10

Private construction

SYSTEM—1947-49

IRON

ingots and

(net

185,920,000

24,454,000

—

Month

MINES):

'

183,407,000

V

Federal

12,251,000

Steel

12,446,000
7,730,000

JuJy

—

OF

Shipments of steel products (net tons)—

1,743,000

1,649,000
11,229,000
6,625,000

-July
—July

CONSTRUCTION

(BUREAU

AMERICAN

7,840,000
25,876,000

7,541,000
27,061,000

1,831,000
11,128,000

RAILROADS:

construction

Total EL S.

7,690,000
27,165,000
1,725,000

(17,461,000

July

(bbls.) at

freight loaded (number of cars)
freight received from connections (no.

CIVIL ENGINEERING
NEWS-RECORD:

6,952,115

lines—
.—July

bulk terminals, In transit, in pipe

unfinished gasoline
Kerosene (bbls.) at—
Distillate fuel oil (bbls.) atResidual fuel oil (bbls,) at.
and

ASSOCIATION OF AMERICAN

6,255,935

27,282,000

July
July
July
July

(bbls.)
Kerosene output (bbls.)
Distillate fuel oil output (bbls.)
Residual fuel oil output (bbls.)

of that date:

are as

Previous

Production of primary aluminum in the U. S.
(in short tons)—Month of February

2,030,000

1,751,000

*6,381,535

0,423,685

July

Crude

Finished

of quotations,

Stocks of aluminum (short tons) end of

Gasoline output

Stocks at refineries,

cases

Month

79.3

(bbls. of

gallons each)
runs to stills—daily average (bbls.)

42

*1,442,000

§1,515,000

in

or,

either for th*

are

Latest

Equivalent to—
AMERICAN PETROLEUM INSTITUTE:
Crude oil and condensate output—daily average

Thursday, July 17, 1958

.

production and other figures for thfe

cover

Ago

64.9

.

Dates shown in first column

Year

Ago

♦53.4

§56.1

July 20

.

or

Previous

tabulations

month available*

or

.

!!'*Nickel

*

MOODY'S

■—

pound)

(per

74.000c

WEIGHTED

74.000(?

74.000c'

$2.25

%

Bismuth

$2.25

$2.25-

:

AVERAGE

YIELD

OF

*

11961 TRANSACTIONS FOR ODD-LOT ACCOUNT OP ODD*
LOT DEALERS AND SPECIALISTS ON N. Y. STOCK
.

100

Number

of

snares

Dollar value

Customers'
Customers'

1,177,664

1,047,318

Banks

1,321,026
$71,218,077

$46,619,209

1,185,603

.June 21

other sales

10,510

10,219

June 21
—

1,167,154

June 21

$51,551,872

|

1,057,724

-June 21

Other sales
Round-lot purchases by dealers-

396,590

1,175,424

$51,758,079

,

1,043,636
$44,130,710

408,580

390590

8.895

1,090,387
$57,518,106

•

361*250

400580

36L250

MOTOR

297,550

.

389,510

360,880

378,790

469,070

—June 21
—June 21

..

L

.

Processed foods
Meats
All commodities other than' farm end foods

744,580
13,516,790
14,261,370

748,710

837,500
12,180,160

12,805,500
13,554,210

%

.

^

4.13

*•

4.58

•

'

.3:08
-

f

v

.

>■

3.79;.

:6.31;

,

-4.40 J

,

239

4.15

.

:

■

4.96

4.84'

:

;

.2.97:

4.27

4.05-

11,434^380

S'.—rAUTOMOBILE

vehicles

of

MANU-

passenger
motor

f

m

of

406,857

-

cars—

trucks

(at

424,273

337,564

^

349,802 "

69,183
110

——„

593,387.

500,669'

74,236
235

.

:*

92,349
^369

•

May:

(BUREAU OF JUNES)—
\

.

(barrels) %

29.274.000

of month^Sarrels)

end

(per

•24,001^100

30.525.0001
33,674,OOOj

___t

1—

Shipments, from mills ( barrels )l_f
Capacity used

465,770
10,968^10

13,017,660

FROM

•

.

Month

*35,170,000

.

25,^18,000

27,485,00028,940*000.
33,176,000.

92

cent)

79

92

$758,932,768

$743,689,988

§907,916,869

RAILROAD EARNINGS- CLASS I ROADS (AS-

-SQCIATION OF AMERICAN RBs.)—Month

•

of-May:

-July
-July

119.1

119.2

95.5

96.5

-July

112.8

*112.8

112.9.

115.9

119.3

114.9

-July
-July

-

118.8
:

.

117.7

95.2:

125.3

-

'

--

106.4

-

"

125.0

-

•

*'

«■'

"

•

revenues
expenses.

operating

9L8
(97.1
"

125.5

^

Total' operating
Total

T

125.4

-^Revised figure, f Includes 990,000' barrels of foreign crude runs. §Based on new annual capacity of 140,742,570 tons
J. 1858, as against Jan. l, 1987' basis* of 133,459,150 tons. tNumber of orders not* reported since introduction, of
1
Monthly-Investment Plan. tPrime Western Zinc sold* on delivered basis-at centers where freight from East St. Louis exceeds
one-half cent a pound.




of

Production

WHOLESALE PRICES, NEW SERIES —U. S. DEPT. OF
LABOR— (1947-40= 109):
Commodity Group-*.
Fatm- products

of

Stocks
..June 21

y

6.06

4.33

%
i

FACTURERS'ASSN.—Mqnth of June:

PORTLAND CEMENT

sates—

commodities

;

__

—*

SALES

Number of motor coaches-^

^

.

FACTORY

VEHICLE

Number

297~550

•

(SHARES):

Short sales

AL

,(24)

C'

-

4.53

PLANTS' IN U.
<

f.

.June 21

V

I:

3.98

'

TOTAL ROUND-LOT STOCK SALES ON THE N. V. STOCK
EXCHANGE AND ROUND-LOT STOCK' TRANSACTIONS

Other sales
Total sales

*

5.91-

L

(10)

Number

-June 21

shares

Total- round-lot

,

1,099,282

14,088"

.June 21

FOR ACCOUNT OP

;

(15)

Insurance

Total- number

Short sales

of

1,131,478

$51,566,564

-June 21

Round-lot sales- by dealersNumber of shares—Total' sales

Number

-

1,203,989
$55,272,322

%

June:

it.

short sales.

Dollar value

of

X25) Utilities (not incl, Amer. Tel. & Tel.)
,

June 21

Odd-lot purchases by dealers (customers' sales).—
Number of orders—Customers* total' sales

STOCKS-i-Month

(125)

Railroads-

*

.June 21

—_

CbMMON

Industrials

EXCHANGE —SECURITIES EXCHANGE COMMISSION:
Odd-lot sales by dealers (customers' purchases)—t

;

Net

railway, operatjing income before, charges
Net ,income after charges (estimated)-—^-

621,365,019" -609:877,188
69,384,212
72,006,442
43,992,811

36,900,978

24,000,000

,16,000,000

^714,591,074*
„

91,116,724

' 80,845,27r
161,000,000*

♦Revised figure, tRased on the producers' quotation. tBased on the average of the
producers' and plater^' quotations. ,§Av«rage of- quotation, on- special shares,-to plater^
((Domestic five tons armore but less-than carload, lot bqxed. sSDelivered where, freight!
from East St. Louis exceeds 0.5c. ••F.o.b. Fort Colburne U. S. duty included.
Aver age,
of daily meait and Wd- and ask quotation at morning session of London MetsfcCxchange.
tiIncrease

all

stocks.

Volume

18&

Xumber 5760

.

.

.

The Commercial and Financial Chronicle

(239)
and

and Business
In the

Election of Francis F.

sees

The

,

birth

our

rate

haps.. this

senior

small

a

ber of

declining.

is

the

downturn

I look for
drop in the

several

in

the

in

women

do not visualise

for

1960's and that it will extend well

to

group.
term

Per¬

into

current

perhaps it is because
the

birth
v

rate

and

000,dOO—up

new

a

in

There is

the

about
a

could

chiefly

that

number
in

women

18-to-34

the

costs.

reach

rity.
that

there

will

be

west

will

—

Fund, Inc.

dia.

more

A

adults,

as

&

the

Midwest

was

Stock

SOUTHERN
NATURAL

Exchange.

previously with Stifel,
Co., Incorporated.

\
1

GAS

COMPANY

of

1958

twenty-five

holders

of

record

the

at

close

of

business September 11* 1958.
JOHN

G.

GBEENBURGH,
Treasurer.

LS

|

NC

regular

quarterly
share

per

on

dividend
the

of

5%. Con¬

vertible

Preferred Stock has been
declared payable September
2,1958,
to
stockholders of record
August

■

Birmingham, Alabama

.J

A regular

■

DIVIDEND NOTICES

quarterly dividend of 3Q$

expand rapidly

share

per

Common Stock Dividend No. 78

A

regular quarterly divi- j

dend of 50 cents
per share
has been declared on the

American

[AVISCOi

Common
Natural

Viscose

5
•

been

29, 1958,

has

Common jStock

declared, payable AugO&t
stockholders of record

to

August 15, 1958.
M. E. GRIFFIN,
Secretary-Treasurer

Stock of Southern
Gas Company, pay¬

able September 12, 1958 to
stockholders of record at the

Corporation

close of business

August

on

29,1958.
DIVIDEND NOTICE

H. D.

R.J.

McHENRY,

Vice President end Secretary.

population

the

on

■

has

Directors

of the

American

Dated: July 11, 1958.

Viscose Corporation, at their
regular meeting on July 1,

1958,

declared
on

the

(25ff)

greater needs, but it takes favor¬

payable
to

late the demand which guarantees
broadened market.
If business

the

confidence

Cmpm;

Makers of

per

IOWA SOUTHERN

stock,

common

able economic conditions to stimu¬

Trim

dividend

a

of twenty-five cents

share

not

•

Camel, Winston, Salem I CeveUer
ciflorettes

July 16, 1958.

of child-bearing age does
necessarily mean they will
bear more children..
y r

on

August 1, 1958,

shareholders of record

close

of

business

at

UTILITIES COMPANY

Niece

Albert, Geerge Washiegtaa
Carter Had

on

ago, the demographers, or

population

sistently

on.,

experts,
were
con¬
the low side in their

forecasts.

Many; of

remember

that

we

my
were✓

the 1930's that the U. S.

had

tives

readers
told

which

enterprise

in

take
i

rate.
we

This

was

at

time

a

when

be

weakened

made

than

incen¬

our

free

it

will

excel,

with forecasts too low.

predictions
are

appear

too eager

Now their

too high!

They

to make simple pro¬

jections of recent trends without

faking into account the economic^
social,

and psychological factors
determine
fertility
re¬

which

though the great popula¬
tion shifts ,of the early postwar
period
have
largely
subsided,

before World War II.

California,

and

Trend

Toward

Later

Marriages

During the first quarter of 1958,

marriages

were

below

number

To

the

me

ward

this

later

down
a

about

year

indicates

a

marriages.

10%

earlier.

trend

to¬

Assuming

the present recession extends into
1'960 and possibly beyond, barring
war—then this trend toward later

marriages wiil continue and could
mean

further

cutbacks

in

our

the

Far

though steady, growth in that area
which is the very heartland of
the nation
the "Magic Circle."

this

next

reason, I predict
babv
boom
will

that
not

Eureka, Kansas,

the Magic Circle extends in a ra¬
dius of 400 miles to include six

Midwestern

souri,

states
Iowa, Mis¬
Arkansas, Nebraska, Kan¬

and Oklahoma — as well as
smaller portions of eight others.
The Magic Circle has already pro¬
duced
est

some

leaders,

©

32 cents per

235th

CONSECUTIVE

CASH

uable

share

on

a

virgin

Company, payable Sep¬

of record at the clpse of

its

ness

busi¬

August 15, 1958.

W. J. CONRAD,

(

Secretary
Winston-Salem, N. C.

1

•

July 10, 1958

~

Chairman

the close of business

ik-

PUNTA ALEGRE SUGAR

Septem¬

Sheldon F. Hall,
Vice President
and

Secretary

Detroit, Michigan,

lH

Hi

1

.

Public Service Electric
and Gas Company

The Board
declared

of

Directors has

dividend of $2.00

a

share on the capital stock
the Corporation, payable

per

of

luly 11, 1958.

I

CORPORATION

1958.

September 2, 1958, to stock¬
holders of record at the close
of business

August 15, 1958.

WILLIAM

C.

QUARTERLY DIVIDENDS

DOUGLAS,
Chairman

July 10,

The Board of Directors has de¬

1958.

clared the

Mac-

following dividends

for the quarter ending Septem¬
ber 30, 1958:

growing forests, val¬

minerals,

of 90

Common and

share has been declared

the stock of Burroughs
Corporation, payable Oct. 20,
1958, to shareholders of record
at

the

tember 5,1958 to stockholders

upon

ber 26,

dividend

share haa. been de¬

on

New Class B Common stjocks
of the

its

July IS, 1938

Presidents

Generals Pershing and
Its

on

EDWARD L. SHUTTS,

A dividend of twenty-five cents

($.25)

share

all dividends payable September 1,1958,
stockholders of record August 15,1958.

DIVIDEND

Hoover, Truman, and Eisenhower,
Arthur.

its

to

of the nation's great¬

including

on

Common Stock ($15 par)

—

sas,

and

birth rate.

For

other

Western and Southwestern states.
In addition,' I
forecast gradual,

With its center at

share

$1.76 Conv. Preferred Stock ($30 par)

for continued good growth in Flo¬

rida,

cents per

44 cents per

I look

—

sponse.

35%

clared

4%% Preferred Stock (130 par)

Shifts

quarterly

cents per

following regqlgr quarterly dividends:

Even

case

A

The Hoard of Directors has declared the

baby
things right again.

Population

QUARTERLY DIVIDEND

DIVIDEND NOTICE

Vice President and Treasurer

another

making great strides in
there are still many more people
prolonging the lifespan.
Again
the demographers missed the boat, moving each year than was the
were

WILLIAM II. BROWN

:

Then

economic boom which encouraged
a
record
increase in
the birth

set

'

t

have

system

more

population boom
to

just about reached its peak/
came World War II and an

should

by further snipipg at the

<•

smoking tobacco

a

'-p Years

prairies,
Class of

Common Stock

DIVIDEND NOTICE

THE SOUTHERN COMPANY
(INCORPORATED)

The Board of Directors has de¬

clared

quarterly dividend of
share on the out¬
shares of common
stock of the Company, payable
on September 6, 195# to hold¬
a

THE SOUTHERN COMPANY SYSTEM
Serving the Southeast through:

30 yents per

standing

ers

of record

business

on

at

the close of

August 4, 1958.

Alabama Power Company
Georgia Power Company




LEROY J. SCHEUERMAN
°

Gulf Power Company

Mississippi Pow er Company

h. H. Jaeger,
tyke President and Treasurer

meeting held on July 10, 1958, de¬
clared a regular quarterly dividend
of forty-two and
one-half cents
(42H{) per share on the Corporation'sCpmmonStock.Thisdividend
is payable August 29,1958, to stock¬
holders of record July 31, 1958.

Southern Services, Inc."

Secretary

Central and South West

.Corporation
Wilmington, Delaware

Board of Directors today declared

dividend of six shillings
per

share

on

a

the

Ordinary Shares of the Company payable
September 2, 1958, subject to the approval
of the South African Exchange Control. *
The Directors authorized the distribu¬

tion of the said dividend on September
\2,
1958 to the holders of recprd at the
clpse
of business on September 5, 1958 of Amer¬

ican shares issued under the terms of the
Deposit Agreement dated June 24, 1946.
The dividend will amount to

approximately

$.84

per share, subject, however, to any
change which
may occur in the rate of ex¬
change for South Africa funds prior to
September 2, 1958. Union of South Africa

non-resident shareholders

tax at

the

.

4.18% Cenudetive Preferred

Limited
The

The Board of Directors of Central
and South West Corporation at its

Per Share

4.08% Camalative Preferred

Dividend No. 47

■

Dividend

Stock

O'okiep Copper Company

Dividend

mmzsz

.

15, 1958.

&

women

•'

dividend

per share was declared,
payable September 25, 1958, to stock¬

31%^

Co., 509 Olive Street, members

of

this

a

larger

quarterly
(25c) cents

A

LOUIS,
Mo. —Leslie
C.
Avery is now connected with Stix

more

bigger popula¬
tion. We have ample proof of this
in the examples of China and In¬

the

July 9,

A

WOOPALL | NDUSTRI

DIVIDEND NOTICES

(Special to The Financial Chronicle)

high

pay

ment

ing the needs of

Broadway, New York 6, K. Y.

states.

It

should

to young

manager of their

as

buying department. Mr. Beardsley
has specialized in covering mid¬

before

itself cannot provide the environ¬
that will assure our meet¬

the

matu¬

But

births.

But

However, population growth by

early
postwar babies

Roftr W. Babson

fact

as

Podesta & Co.

of

continued

and

Business

joining Van Ingen, he
with Cruttenden,

associated

61

'

the next 10 years.

over

and

war

Prior to
was

ST.

mind,

my

of

wave

DIVIDEND NOTICES

MIAMI COPPER COMPANY

Now With Stix & Co.

He

business

tremendous!

tomorrow

increase

rapidly

Salle Street.

group—the fathers and mothers of

the

will

dren)
soon

municipal bond underwriters and
dealers, as manager of their mid¬
buying
department.
Mr.
Beardsley will be headquartered
at the Chicago office of the Van
Ingen organization, 135 South La

such baby boom gets rolling,

attention

chiT-

most

heavy
be

on

George

—

west

Business

on

doubt, in

impact

competition

the

group (which
•

this

business
faces
some
the, American
of hard years of greatly intensified

age

breeds

no

the

new

any

fact

a

111.

(Special to The Financial Chronicle) '

BOSTON, Mass. — Francis. E.
Park, JII, is now with Kidder,
E.
Peabody & Co., 75 Federal Street.

Beardsley has become associated
with B. J. Van Ingen & Co.
Inc.,

"

their forecasts
on

Effect

He is also Chair¬

Board, President and

tion and the Whitehall

Nicolaus

Long-Term

early 1960's.
They base
-

from

Selig¬

poration, National Investors Cor¬
poration, Broad Street Investing
Company, Union Service Corpora¬

to

year's estimate of 4,250,000.

of birth

wave

rebounded

Factor

Some population experts antici¬

pate

of
depressed

60%

some

W.

assume,

today's

will have

late

highs in the mid—or late—
1960's. My forecast is that 20
years
from now our annual birth rate
will be in the neighborhood of
7,-

;

Pay Heed to the Economic
.

I

the

new

near-

baby boom

,

1970's.

that

economy

18-to-34 age:

new

a

years,

num¬

further

a

the

course,

since 1940.
of the

&

member of the executive commit¬
of the Tri-Continental
Cor¬

really

until

partner of J.

tee

1950,

going

Company has

nation's

man

Eureka, Kansas.
get

the

man

since

due

is

recession. Or
of

time

first

the

of

leading fi¬
nanciers, Mr. Randolph has been a

population growth by itself, and forecasts continued good
population growth in Florida, California, Far Western and
Southwestern states and steady growth in the
magic-circle

For

Union

announced.

One

in

its center,

Grand

been

virtue

no

senior

With Kidder, Peabody

George Beardsley With
B. J. Van Ingen & Co.
CHICAGO,

Randolph,

and

of J. & W. Seligman &
Co., to the Board of Directors of

greatly intensified

Writer

banker

partner

baby boom starts rolling again—which Mr. Babson
60% twenty years from now, going from
present annual birth rate of 4,250,000 to 7,000,000—American
business is expected to face hard years of

population.

Francis F. Randolph Dir.

Until the

as

in

investment

believes may rise to

which has

hydro - electric energy
easily support a tenfold in¬

crease

Oncoming Years

competition and continued high cost.

vast

would

By ROGER W. BABSON

,4$

..

1.045

..

1.075

4.30% Cwmdetive

Preferred

.$1.02

5.05% Cumeletive Preferred!.. 1.2625

$1.40 Dividend Preference

...

Cemnten

All dividends

before

.35

45
are

payable

September 30,

on or

1958 to

stockholders of record August

29, 1958.

'

F. Milton Ludlow

Secretary

rate

of 6.45% will be deducted.

By Order of the Board of Directors,
F. A. SCHECK,
Secretary.
New York,

York, July 15, 1958.

LIC SERVICE
CROSSROADS

0T

THE CAST

The Commercial and
44

Financial Chronicle ;

1958

Thursday, July 17,

-

.

(240)
Washington 25, D. C.

BUSINESS BUZZ

— Cham¬
Czechoslo¬
vakia (published in German and
English)—13, ul. 28, Fijn, Praha
1, Czechslovakia—paper.
Fiscal Policy Implications of the
Current Economic Outlook:
Hearings before the Sub-com-r
mittee on Fiscal Policy of the
Joint
Economic Committee of

BeHnd* the-Scene
(real the

•

•

•

A

Interpretations

Nation'e Capital

JL

gi
JL f wfAs

y /Iff

A.
V^

7^

fc7*

WASHINGTON. D. C.

Commerce of

do

should

brother

portant

There
President
given a hero's
welcome
by Panamanians on
two
different occasions as he
rode
through
the thronged

good

some

countries.

of
is

countries Vice - Presi¬
dent Nixon did not visit on his
trip South in May.
These in¬
clude, in addition to Panama
which was his first stop, the
visiting

and Guatemala.

El Salvador

gua.

prices

facing

this

Pan-American
have

the

of

Some

mates

the

are

carry

the

gon,

000,000 bags.

Half

permanent

a

world.

pounds

a year, or
of all the cof-

has become a

in the world. Other
major importers of coffee in¬
clude
France.
Belgium, Italy.
Canada, Great B ri t a i n and

It

agency.

16 Latin

American re¬

Brazil continues to grow
about half of the world's supply.
Columbia is the second largest
omy,

growing republic. Most
of the nation's coffee is import¬

coffee

York and New

Orleans.

is

Eisenhower

Dr.

expected

whole Latin American
.side of the story about the cof¬
fee dilemma on this trip. He is
also expected to hear an un¬
usual request.
Latin American
repersentatives are suggesting
at every opportunity that they
think it would be a good idea
for
the
housewives
in
the
United
States
and
elsewhere,
to get the

Savings
probably will

that they pay a

the top

per

association mortgages.

-

'

•

♦

it

seems

housewives of this

*■

■

that

the

country are

subsidies
pertaining to OUT own agricul¬
tural products, without helping

already paying enough

to subsidize other countries,

in¬

neighbors

to

cluding

not get

our

the South.

own

Nevertheless, it is to

the good of the economy

of the

20% of savings and loan
The 20%

praised value.

.

Two years ago

er

stable.

Dr. Eisenhow¬

accompanied President Eisen¬

hower

to

Panama

where some

of state,

the

Kerr
:

"escape

clause" procedure on
■

the ground

that it "emasculates?

the whole
a consid¬

trade

bill.

Meantime,

erable amount of crude oil con¬
tinues to be
uct

imported.

imports

in

the

Oil prod¬

last

weeks ending July 4 were

four
636,-

Financial Data

—Quarterly review—Air Trans¬

Association

port

America,

of

1000 Connecticut Avenue,

N. W.,

Washington 6, D. C.—paper.

It

seems

ing

to

Housing

American

New

Use:
—

Winnick—John Wiley

Louis

Sons,

Its

and

Space

&

Demand

Shelter

for

Inc., 440 Fourth Avenue,
York 16, N. Y.—$5.50.

Annual Review of

British Industry

Intelligence Unit
Ltd.—British Book Centre, Inc.,

—

Economist

122 East 55th

22,N.

Street, New York

Y.—cloth—42 shillings.

Bituminous Coal Facts 1958
tional
ern

Coal

—

Na¬

Association, South¬

Building, Washington 5,D.C.

Cotton

Production

States:

in

the United

Crop of 1957—U. S. De¬

Government

Printing

Office,

will

with the session, but it

be

again,

revived

in

likelihood, when the
gress

The

United

next

convenes

greatest
States

new

Con¬

January.

growth

in

all

in

the

savings since

ing and loan association institu-

Y.—$13.50.

Relationships Between U. S.
Consumption and Natural Re¬
sources 1899-1947-1954—Bureau
of Business and Economic Re¬

search, University of Maryland,
College Park, Md.—paper.
University of Chicago Press: Books
for

1958—Catalogue—Uni¬
Press, 5750
Avenue, Chicago 37, 111.—

Fall

of Chicago

versity
Ellis

paper.
Volume

Debt in the
Decade—Saul B. Kla-

of Mortgage

Postwar

man—National Bureau of Eco¬

Research,

Avenue, New

261

Madison

York 16, N. Y.—

paper—$2.

TRADING MARKETS
American Cement

Botany Mills
Wurlitzer Co. Com.
Fashion

Park

Indian Head Mills
United States Envelope

of the House and

committee
that the proposal will

York 16, N.

partment of Commerce—Super¬
intendent of Documents, U. S.

accord¬

time,

this

Vazsonyi—John Wiley & Sons,
Inc., 440 Fourth Avenue, New

nomic

—paper.

Morgan Engineering

banking

members,

expire

at

some

Senate

Programming inl Busi¬
Industry — Andrew

and

ness

Some

of the League.

blocks in the way

assemblage of heads of state in




ton, D. C.—paper.
Airline Traffic and

Asso¬
ciation and the mutual savings
banks have been throwing road

World War II has been in build¬

heads

the

Values—Interna¬
Washing¬

tional Monetary Fund,

4

greatest

19

fight

Fact Book 1958
Savings and

221 North La Salle

Schedule of Par

The American Bankers

United States that the economy
of Latin-America remain

|

J.

States

United

Loan League,

would kSLQn the 90% of the ap¬

-

However,

will

—

Scientific

of Commerce Sin¬
clair Weeks has already warned
that the Eisenhower administra¬
tion

University, Princeton, N.

ton

un¬

,

,

Section, Prince¬

—paper—30c.

Bookshelf

Secretary

States

United

Senator

Indus¬

References,

Relations

Street, Chicago 1, 111.—paper.

adopted in
Committee.

committee.

2£, N. Y.

Organizations and Re¬
search Workers—A bibliography

Savings and Loan

who

supported

state,
in

Loan Insurance

but

setback.

2

of

Research

Man's

represents the No.
oil and natural gas producing

isiana,

York

New

—

488 Madison Avenue,

America,

Business

Senator Russell B. Long of Lou¬

probably can be constituted as
quite a sizable business.

The

amendment

Senate Finance

the

question immediately arises
once
again: What is a small
business? Any business that can
wrangle a $350,000 loan at 51/2%
interest rate from Uncle Sam,

their legislation through
this year, but they appear to be
making some headway in its ef¬
fort to get Congress to insure

particularly in America,
few cents more
pound to help stabilize the
economy and save those coun¬
tries from a
severe
economic

import

The

and Loan League

amendment

Association

Insurance

—Selected

questionably will evoke a great
amount of debate on the Senate
floor.
Senator Robert S. Kerr,
Democrat of Oklahoma, one of
the wealthiest men in Congress,
led the
efforts to get the oil

Adminis¬
appraised now
as
another example of a big,
mushrooming Federal Govern¬
ment. The ceiling on individual
loans made by the Small Busi¬
ness Administration is $350,000.

Life

trial

impairment to
the security of the country is
being threatened by imports.
defense

Association of America

ance

controversial

termines that the

The

the Life Insur¬

not coincide with
"Chronicle's" own views.]

provisions in the foreign trade
bill
approved by the Senate
Finance Committee comes under
the so-called "defense amend¬
ment" to the measure.
Under
this amendment
the President
can
limit oil imports if he de¬

has become a per¬
after 12 or 14 years.

Fifty-First An-

nual Meeting of

Curb

of the real

One

6, D. C.—cloth—$5.

and may or may
the

Oil Import

tration should be

Home

their savings are

Institution,

Proceedings of the

[This column is intended to re¬
flect the "behind the scene" inter¬
pretation from the nation's Capital

secure.

The Small Business

publics depend on coffee for a
substantial part of their econ¬

ed through New

they feel that

cal purposes

manent tax

and loan associations
simple reason they get
interest per dollar and

more

which for all practi¬

tation tax,

H.

Place, Washington

Jackson

722

ago.

the

for

temporary

a

that many

The facts are

building

like the wartime transpor¬

tax.

Sweden.
While

permanent agency.

levying

like

is

daily, an increase of
198 barrels or 45% greater than
the corresponding period a year

000 barrels

people in this country stopped
buying U. S. E and H bonds and
started
obtaining shares in

Created in 1953 as a temporary

grown

Approach—A.
B. Dirlam and

agency—like so many bureaus
and departments of the govern¬
ment see the light of day—it

about two-thirds

Case
Kaylan, Joel
Robert F. Lanzil-

Big Business: A

in

Pricing

—

lotti—The Brookings

States is the No. 1

20,500,000

Time You

Future!"

Talked About OUR

drinking nation of the
This country uses about

The United

coffee

Potato Futures—It's

"Never Mind

it

istration

Salem, Oreg.—paper.

Involving Securities

of
Reconstruction Finance Cor¬

poration,

.year or more. Furthermore, the
^Department of Agriculture says
that the world consumption of
coffee will amount to about 38,-

iee

tion

and Crimes
Corpora¬
Commission, State of Ore¬

Oregon Securities Law

has appeared that
the time would come when an¬
other
similar Federal lending
agency would be created
and
would operate under a different
name.
':%•/- T>C:.
The other day Congress sent
to the White House a bill mak¬
ing the Small Business Admin¬

20,000,000 pounds
will be large enough to supply
coffee for the United States for a

Brazil Supplies

prevailing in

since the liquidation

Ever

than

more

E. C. 3,.

Permanent

SBA N ow

Esti¬
over of

inevitable.

coffee appears

Motor

Lombard Street, London
England—paper.

ers,

tions.

reporting for several
months that a big carry over of

Central

etc.—Institute of Bank¬

Trade:

eloquent manner: "We were

been

R.; Dilemma of

Banking: Finance for the

States."

in Washington

President's

the

U. S. S.

once

surplus.

Y.—paper—$3.
Bankers

including articles on
Visit
to
the

1958

June

sensitive1 about Canada
being considered merely a colo¬
nial extension of Britain.
We
are
now
even
more sensitive
about being considered a north¬
ern
extension of the
United

a

embassies

Larchmont, N.

Journal of the Institute of

far.

currently

timent

Latin America is
recession. The greatest
coffee crop of all time is fore¬
cast for both Latin America and
Africa,
thus providing
a big
Today

felt.

Tax

Lasser

Canadian Foreign
Minister Lester
Pearson suc¬
cinctly expressed Canadian sen¬

up the
the drop in
begun to be

ladder,
has

economic

Retirement — J. K.
Institute and Sam
Shulsky — Business Reports In¬
corporated,
2
East
Avenue,
for

Investing

Former

slowly

edging

is

ally

coffee

C. Dunnion
Reports, Incorpor¬

ated, 2 East Avenue, Larchmont, N. Y.—cloth—$12.50.

neighbor

good

and

and John

Business

—

to

the

to

customers by

America gener¬

Latin

While

relative

Rica, Nicara¬

Costa

Honduras,

.

policies of our next door neigh¬
bors,
Canada and the Latin
American countries, our biggest

countries of

American

Central

;

Eisen¬
Canada re¬
cently should well serve as a
good purpose. More and more
official Washington has begun
to realize that we have not al¬
ways
used prudent judgment
himself

hower

University,

Hopkins

City.

Visit

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The

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Eisenhower, President

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—paper—55c.
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during the next weeks with his
informal discussions of some of

Government Print¬
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uments, U. S.

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Eisenhower

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paper —

Economic News Service
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Washington

—

15c.

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