Full text of Commercial and Financial Chronicle : July 18, 1946, Vol. 164, No. 4508, Section 1

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BUS. ADM.

UBRARY

Final Edition

ESTABLISHED 1839

Reg. V. S. Pat. Office

Volume 164

Number 4508

New York, N.

Y., Thursday, July 18, 1946

The Administration's

Full

Economic Cannibalism

•

London School of Economics

-'.v

Mr, Reece

Kyr;

■^

-j

•• •"

*•' *

•

*"*

•*

•-*

■ ■■

"•

*"*>-- jf'.

■"*

•

accuses

claret -'Red-Fascists"

trying to lead us down the road to a onea police state.
Warns that deliberate confusion
of language: is resulting in confusion of economic thought; induding public complacency about currency debasement. >
:v,
\

are

ji
*

| .,c The desperate /condition ot the world today furnishes dramatic
examples of civilized man's oldest problem—namely how to secure
ifor himself &
<$>-

/v !g

ove r nment
strong enough
to protect him

As was so effectively set forth
by Karl Marx, an important part
of the science of bad

without being
strong enough
to destroy

him.
;

For

gov¬
ernment is ex¬

see

the individual

meanings.

This art of confusion has been
practiced upon the American peo¬
ple ever since 1932 when the Dem¬

must
it.

America

has

Carroll Reece

bad

gov¬

ernment

to¬

day because for 14 years we have
been appointing bureaus to gov¬
ern us as a device to escape the
responsibilities
of
self-govern¬
ment.
j

And there is

;

no compromise be¬
self-government and bad
government because God never

tween

created the man with the wisdom
and restraint to wisely and
:

•

kindly

rule the lives of others.

♦An address by Mr; Keece be¬
National
Republican Club,

fore

jNew York, July 16, 1946.
Index of Regular Features ap'

pears on page

•:?

proposals

Full

Employment in Sweden

396.

The trick of waving the liberal
flag in politics is as old as politics
itself, and always appeals to the
unsuspecting voter. <

Technique of the False Liberal

of the

country under the name
(Continued on page 382)

Hilton Hotels Corp.*

aim.

contemplated compensatory measures, as: cutting
down imports when exports
decline; creating In¬
vestment Council for
voluntarily coordinating pri¬
vate investing with
public investment policy; local¬
izing industries to conform with labor exigencies;

eralism and proceeded to admin¬
ister the 1932 platform of the So¬
cialist Party upon which they

could never have been elected to
office.
We have had this self-styled
liberal party for fourteen years;
and it's high: tithe that someone
examined this so-called liberalism
in the light of public interest;

which

Political Scientist states while his
country now enjoys a labor market of
over-full employment udth rationed
workers, promotion of. permanent
full employment remains
primary long-term aim of
Sweden^ Labor Government. Dr.
Bjornberg lists

campaigned,
and
were
elected, on a platform embodying
sound Republican principles and
then ran up the flag of false lib¬

The technique of the false lib¬
eral, as stated by Benjamin Dis¬
raeli, is to attack the, institutions

Vacuum Concrete

By ARNE BJORNBERG

ocrats

stimulating consumers' purchasing power at times
slack—suggested by Myrdal Com¬
mission—by giving rebates to families buying furni¬
ture and clothing,
reducing taxes in lower brackets,
of employment

and

subsidizing

measures.-

large-scale, housing

by public

Full employment has become a keyword for
«' / political postwar
program-in practically all. coun¬
look back upon the years
following the first World
War we all feel the same: fear of
sliding back again to the old con¬
Ame

tries.

Bjornberg

When

we:

ditions, including unemployment, poverty and complete lack of se¬
curity for the: majority of the people. Governments in many coun¬

tries have in

At the outset

the

most

t h

(Continued

ous

these

catchwords
which
to

seems

i be

sc r

merely

de¬

sirable state
of

affairs, but

in
Friedrich A.

fact

ceals

Hayek

ular
about

the

which

and

."theory

extent

reason

achieved, is, of

"full employment."

course,

manner
can

con¬

partic¬

believe

There

that

even

of those who originally gave
currency to this phrase are be¬
coming apprehensive about the
way it is being used. In the writ¬
ings of the learned men who first
many

systematically used the phrase, it
did not
to

mean

cussion:
one

what

bound

was

in popular dis¬
guarantee to every-r
of the kind of work and
pay

come

mean

(Continued

page

372)

had quite a number of

page

366)

State and

Common Stock

U. S.

Havana Litho. Co.*
\

'i:J'A'

'•

;'Z<1"'/Nt'

•

Prospectus

AIRLINES, INC.

Common Stock

request

Prospectus

HlRSCH & CO.
■

Members
t

;

ULIENTHAL ft
York

New

CO.

INVESTMENT SECURITIES

Si., New York 4( N.Y*

2-0600

Chicago

Teletype NI1-210

Cleveland

Geneva

London

'iS:

(Representative*

64 Wall

B0(^j|(IND
'/V

Troy

Baltimore
,
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Pittsburgh
Springfield

Syracuse
Dallas
Washington, D. C.
Scranton
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New Haven
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BROKERS

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Tel. DIgby 4-7800

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NATIONAL BANK
OF THE CITY OF NEW YORK

,r..y

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New England
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SECURITIES

Appraisal of

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request

%;■

Members New York Stock
Exchange

t,;

Values

available upon request

\
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Conv. Preferred

Rejmolds & Co.

120

„

CANADIAN

New York 5
Enterprise

-W

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Company

Teletype N. Y. 1-576

TvionViono'

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Conv. Preferred

INCORPORATED

45 Nassau Street

Department

THE CHASE

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mrn.iin

INCORPORATED

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NEW YORK

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Members N. Y.

Bona

Distributors

MARKETS

MEMBERS NEW YORK STOCK EXCHANGE

for Banks, Brokers

V^LONG antGOMPANY

BULL, HOLDEN & C°

Bonds

Service

Acme Aluminum
Alloys, inc*

CORPORATE

HUGH

Buffalo

BOND

Brokerage

•.,

PHILADELPHIA

Albany

Municipal

and Dealers

Wholesale

Street, New York 5

BOSTON

Bond

PKOSPICTUS.ON REQUEST

Establlshed;i92?;

Stock

Exchange
and other Exchanges

35 Broad
HAnoyer

R. H. Johnson & Co.

Successors to

HIRSCH,

on request

MANHATTAN

Broadway, New York 5, N. Y.
Telephone: REctor 2-8600 : /*
.Bell Teletype NY 1-635

HART SMITH A CO.
■.y: '•Members
New York Security Dealers Assn.
52

WILLIAM

]

ST., N. Y.

HAnoyer

2-0988

Bell Teletype NY 1-395

New York

Montreal

Toronto

danger¬

perhaps I had better briefly sketch the political

country. During the 20s

they

moment

more or less elaborate
form proclaimed a program for
full employment and social and economic
security, likewise the gov¬
ernment in Sweden.

situation in our

callously dis¬
regarding the
social good at

Assistant to Gunnar Myrdal, Minister of Commerce

page 351.

says, and to
make it work

Trend,"

is the art of confusing the public
with words that have pleasant

citizen

converse is true.
;
: - !
; r
f
ft.
favorite trick of radical reformers to
appropriate for a pet theory of their own some good
word^esaribingi an: attractive-state'of - affairs,^ and" then - to accuse every one whO'fs'not prepared- to
/.^.v 1.1,:,^
1 "i.r
Jswallow their.'

earlier address; byMr;

work

boom times

government^

cratic Party's Red-Fascist

actly what it

really could |
kighv level of employment and a free, stable> economy. Denies efficacy of purchasing
power t
expansion, stating^^ problenr does not arise from total volume of expenditure, but from its
distribution, |
;; and;
from?.wages; and t prices) at jwhick goods and sendees are offered. Describes as illusory expecta- (
tion .ofinvestment demand: being revived
by main tenance of final i consumption demand;; stating in |
secure a

Reece, bearing the title "Demo¬

/';////:;/■',/,

Self

;

party system and

Noted economist - asserts "full
employment" lias become a popular catchword for a highly technical
concept,.which is affirmatively injurious, because resulting illusion that we can achieve this desired aim
|
through unworkable nostrums, leads to complete negleet of those - sound measures which

*"!' v».vvV?-.'".

Truman Administration of engaging in ja political'
shell-game with patter of trick pbrases to distract the public. De-

■,

Author "The Road to Serfdom," etc.

Chairman Republican National Committee

t-i •::?

•

Copy

Employment Illusions

By CARROLL REECE*
•

Price 60 Cents

ira haupt & co.
Members

and
111

New

other

York Stock Exchange
Principal Exchanges

Broadway

New

York

REctor

10 Post Office Sq.

Tele. NY 1-2708"

Direct

Boston 9
' ' Hancock

2-3100
>

| ;

3780

•..

Private^. Wire

Boston

Trading Marketa in: ...Z

Common*

UN's Future Will Follow Paris Meetings

Supply

Gen. Builders &

Com.

V Diplomatic proceedings onboth sides of Atlantic simultaneously demonstrate, universality of :Mos0wY ,
'J[ intractable attitude, and climactic widening of the East^West rift. wParfe action'on Trieste, Germany, and
Italy, harbors portentous potentialities regarding fate of United Nations Organization.
Thrfate ot^he Ilnited^-Nations Oi^ipzationis inextricably
atom) bound up with the continuing peacemaking struggles in Paris. : Ija the apt Bastille
Day words o| Mr. Churchill: f We must Jhay e faith^ int the / United Nations Organization,
which ^ supported by the United,Stati^but yvlthput
^itecl
organization is"futile and only a diplomatic simile. Our first Hope is "to Be
European^'
The close functional relationsfiijp'betw^aii UN and the- proceedings^ of the BigFour

Timely Clothes*
U. S. Airlines*

Doyle Mfg.

■

•With

•

Prospectus :'

KING & KING
;

SECURITIES CORP.

Foreign
isters'

TELETYPE NY 1-423

ings

./■

meet*! I*"'
evi¬

r. b y

several

of the

Baltimore

A. Wilfred

Stock Exchange
N. Y. S-

May

1-1227

Belt Teletype N. Y.

will
ac¬

Charter

aegis ; of

the

majority rule of the General As¬
sembly.- Again,; thp Trieste
raogement will be administered
by UN (possibly causing its event.-?
ual downfall). Also, the future
of political refugees and other dis¬

WOrth 2-4230

Common

of trade controls and

excess-export to an

The recent announcements

Electric Ferries
Common &

vigorously activated dur¬
fall's General Assembly
session, but in principle it is go¬
ing to be challenged by Pr* Evatt
of Australia at the forthcoming
Peace, Conference
deliberations.
This challenge will be made at
Paris—not legalistically perhaps^

ing this

Vanderhoef & Robinson
Members New

York Curb Exchange

31 Nassau Street, New
Telephone COrtlandt
Bell System

York &

7-4070

Teletype NY 1-1548

operation

•,

•••,

Guaranty Co.

;

*.,.*/'

Bcmght-^Soldrr-Quoted
5 f\v

4 :ts }
•

H. G. BRUNS 8 CO.
20 Pino Street, New

J-

ffiPONNELL&fa
Members

York 5

New

Telephone: WHitehall 3-1223 •

York Stock Exchange

New York Curb

2-1843

BeU Teletype NY

Members New York Curb, Exchange

•/•/•Bell

maintenance of foreign

The whole foreign financial and

being afforded

ecohoiftid' program of thb Admiiw
istrationf during recentiLyear^ihas

the

been: directed

22ft

Exchange

Frank C. Masierson & Co.
Member* New York Curb Exchange

Tel.

REctor 2-7815

64 WALL ST.

NEW YORK 5'

HAnover 2-9470,

Teletype NY 1-1140

end.

same

the

J
j to the holding of a series of inter¬
3Mr. Aldrieh Has been" vefry acf governmental trade and employr
tive in iniernational
trade 'and ment conferences. The first of
financialmatters^ He. has particir hese -takes place in October. In
pated in the work of the Inter¬ the present article we shall trace
the genesis of thq commg meetf
national Chamber, of Commerce,
ings, their objectives, and
the
through the United states. Asso*. "views of businessmen's committees
ciates, and both last year and this which have studied the official
attended meetings of the Interf proposals.

BROADWAY^ NEW YORK

City Units

and

expanding level.

Herbert M. Bratter

Tudor

trade, both

export and import, on a high

business lead- h

Bridge

Avon Allied Prod;

and

promote the development

ties which are

have

Detroit IntT

announced.

capital and to
opportuni¬

(Va.)

Common Stock

Financing

cil, the President has

the

SyotoB^^l^typo/NT/l^t^lByY

Central States Elec.

Foreign Trade will work, closely
with the National Advisory Coun¬

private

Broadway WHitehall 4-8120

for

Committee

4 The

Bank of New York.

Alegre Sugar

Capital Stock

and

Members New York stock Exchange

Accomplishments to date, such as
government eco¬ the es.abltshment of the Fund and
foreign poli¬
Bank, have been but stepping
cies. Chairman of the Committee stories to the greater trade ob¬
just mentioned is Mr. Winthrop W. jective. The preparations of the
Aldrieh
of. the Chase National
past several years are soon to lead

Home Title

North.

Punta

Edward A. Pureed &. Co.

Assoc. Gas & Elec. Corp.

nomic and financial

Pittsburgh, Shawmut &
% Receiver's Ctf*.

of his bank.

be¬

Jockey Clubp

activities

loan

One of the Committee's objects

voice

Corporation

Common

foreign

tween the Ad¬

formiilatori
Byrndun

course

co¬

Monmouth Park,

Committee for Financing For-

ministration

ers

(Continued on page 384)

nels

Carpenter

Vacuum Concrete

the American Bankers Association
on
international1 matters, and of i

potato," will not growing chan¬

only be

Preferred

branch office*

from the White House concerning the

appointment by the President of *he
eign Trade, a

by a UN

UN's own "hot

our

Textiles, Inc.
L. E.

problems arising in converting U. S. from an
excess-import nation.

committee. trialisis, draws
Amdrjthe Vetq technique, hitherto attention to the»

Mississippi Shipping

NT 1-1557

Central Public, Util. 5%
-

preparation for meeting to be held in 1947 to establish an
Organization! Points out difficulties in removal

and six indus-,

worked- on

Exchange

York 4, N. Y.

^•.V^^tySoya Corp.'!'";!''

International Trade

persons, slated as a major
committee
of
peacemaking problem by the Big si* bankers
Four ministers, is being closely

placed

Rogers Peet

New Orleans, La.-Birmingham, Ala.

calling attention! to recent appointment by Presi¬
dent Truman of a committee of businessmen to work with National
Advisory Council in financing of foreign hade, discusses history of
movement OH part of this country to bring about international
cooperation In expansion of World trade and in temovixig international trade barrier*. Note*wortb£teceutlp revived International
Chamber of Commerce and the Economic and Social Council of the

and under the
:

;

■

120 Broadway,

Members New York Stock

Mr. Bratter, in

cording to the
U N

j-.,;

Expansion Proposals

Italian

made

25 Broad St., New
HAnover 2-0700

Foj

colonies,

c.-

Steiner, Rouse & Co.

By HERBERT M. BRATTER

dis¬
position
of
Libya and the

Mitchell&Companir

* ■'■

•}•,

Direct wire* to

example,

other

'•

Bought—Sold—Quoted
,y>

Businessmen Examine Trade

the

session.

Members

Investors

—

;—■

' "J

Paris

latest

LEMKE

—y-.' /

cisioas

; taken

Trading Market in—

denced

B. L.

Pacific American

gooS

1920
Security Dealers Assn.
Nafl Ass'n of Securities Dealers, Inc.
40 Exchange PL, KT.Y. 5
HA 2-2772
:Established,

Members N. Y.

BEIiI.

Bird & Son

MAY

By A. 1VILFRED

Old Frisco Pfd. &

Thursday, July 18, 1946

COMMERCIAL & FINANCIAL CHRONICLE

THE

All

'
•

Council abrqa$.

He is active also

in the work of

Meeting in London

The October

The October meeting

national Chamber

■'*'•

Issues

Chicago, MiL, St. Paul & Pac.

■

-M /'

;

5s/2000

Minneapolis & St. Louis R.R.
'i
All Issues ;i^

Chicago, Ind., & Louisville

(Old Issues)

Consolidated Film Ind.

Consolidation Coal

GUDE, WlNMILL & CO.
Member* Neto York Stock Exchange

1 Wall St., New

York S.N.T.

]

T.lrtn»NV t-OM:

01,by 4-7060

in London,

preparatory.
It will be at-<
by ;he United States and
18 other countries.
Representa¬

tended

We Maintain Active

General Builders Supply

Markets in U* 5. FUNDS for

canadian industrials

Michael Bros.

canadian banks

canadian utilities

Request

Canadian Securities Dept.

Member* JV. Y. Stock Exchange

Members N. Y. Security Dealers As$n.

Hanover 2-4850

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T«lephoneBArcIay7-0l00

Keynote

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lation of United

Nations organi¬

economic sphere.

INDUSTRIES
v? &

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\,ys «■> ji

' < .ir

Common

Prospectus on request
y-)r-l « '1 ',
v v.,s""

Request

Simons, Linburn & Co.
Members New York Stock Exchange t

25 Broad

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Qurtationg Upon Rtquert

FARR & CO.

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New

j-'-'1"''1 r. '«"• ir-s
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BOUGHT— SOLD

Troster, Currie & Summers
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Dealera

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Stock Exchange »

New

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Exchange.

WALL ST., NEW YORK}
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|

120

—

Western Union

QUOTED

leased Line

Southern &

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bought
Member

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York Curb Exch. Assoc.

New

International Ocean Telegraph Co,
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Bought & Sold
'Prospectus

Common

Jefferson-Travis Corp.

GREAT AMERICAN
a,-,

•

Stock

Associates

(Continued on page 362)

hi the

zations

Phonograph. Records
Common

arid Other Principal Exchange*
NEW YORK 6, N» Y.
Teletype NYt-672

for Banks, Broker* & Dealer*

yvVv1

another
important member of the constel-;
(ITO) will be created as

COSMO RECORDS

Recordings, Inc.
Manufacturerof

Goodbody & Co.

»Teene<mdCoT(vpaTiu
37 Wall

fruitful, there will be.
held in the fall of 1947 the longcontemplated general International
Conference on Trade and Employment at which, it is hoped, the
International Trade Organization,
is

erings

canadian mines

Reeves Bros.
Prospectus on

Eastern Sugar

the same countries will
again in the spring of 1947,
and if the work of those two gath¬

tives, of
meet

■

sold

Teleg. Cov ■

I quoted I;-

j* g'White 8 Company
.

incorporated

;

{

Trinity Place, New York 6, N. Y

Telephone HAnover 2-2400 1 Y
Teletype 1-376-377-378
Private Wires to
Buffalo—Cleveland—Detroit—Pittsburgh—St. Louis .4

37 WALL
r

STREET

;

NEW YORK 5

ESTABLISHED 1890

TeL HAnover

2-9300

Tele, NY 1-1815

Arnhold and S. Bleichroeder
INC.

30 Broad St.
wwit.ahn.11

1-fl2na

New
TplAt.vriA

York 4
NY

1-51S

.Volume 164"

Number 4508

^H^CQMMERaAE;& tlN ANClAL CHRONICLED

Burying "Inflation Bugaboo-

MoieFallacies About Wages and

By A. M. SAKOLSKI
!

wtil|ia«ii|jpCjajgjgejjare 11 §

0r« Sakolski reviews changing attitudes toward inflation dangers,
expressed by various official and other: commentators since Presi-.
dent Truman vetoed the OP A hill.
Says their previous exajgeratiofts of nced for price controls has caused
confusion, fear$, and

toss of confidence in

economic

;■

our

'-'if.-VV ■>'''>■■

•:

< '

•

■

Af er almost four years

Probably
in

not
topic

any

econ'omic

monetary

science

says

information
been

put

forth by
ernment

gov¬
offi¬

A. M. Sakolski

Attacks

must pay

Almost

aa common

USED AND

principle

STOCKS (AND BONDS"
i"-"

laborer,

through taxes

WALL

^—,r

Obsolete Securities Dept.

STREET, NEW YORK

Telephone WHitehall

the ^make-work" fallacies whlchr
plague
exchange!, are the fallacies about prices and
3

•

4-6551

lacies."

hat

Wage

StSndardsr

In that article the

the

provide

controls, etc.,
"groups

State

Schulte

Real

Estate

Pf^.

society should

standard

Hotel Barblzon

Fal¬

fallacy

living for

its citizens, mainly for those who
had neglected or refused to
pro-*
vide an adequate (Standard, for

which

Book Cadillac

v*>-

f-Living

of government

United

Broadway

Piece

Dye Common

economis. s"

.themselves,
! i Xh| the
lacies of
used and

phasis;

was

exploded,;

;

same
a

connection the fal¬
"Noble Sentiment" mis¬

misconstrued, and of

upon

high nominal

.J.G0LDWATER&C0]
Members New York

em¬

derail.

Broadway
New York 6, N. Y.

wages

rather than upon high real
wages
dealt - with in considerable

Security Dealers Aitnk

HAnbver Z-8970

were

avoid drastic inflat'on with its ac¬

the

FOR

OBSOLETE

a one-

Teletype NY I-I2B3

In the meantime one after

another labor leader, apparently
Dr. Frederie E. Lee
this author in
with full government or adminis¬
"suffering," "chaos" the
"Cpmmerand "disaster."
press, professional economists and
Perhaps, Alf L. cial and Financial Chronicle" of tration
support, has be£#t*$hg ^0
political commentators in the last Landon was right when he stated Dec.
20, 1945 in an article entitled
(Continued on page 356)
four years.
in a recent address: "The observant
It ha<?

cials,

O.P.A.

PAID

as1

the student of
money and
wages,, wages
and
social

theories

uphtld by

the industrious aud honest

self-supporting and who

about it, very few have been
try¬
it, and still; fewer ing * to ,r
put
were capable of explaining it.
,
across as eco¬
One has merely, to glance back
nomic I truths
to the pages of the "Chronicle"
in
recent
over the last year to get an idea
months. Some
of the gross exaggerations of the of
these were
need of overall price controls to
described

distorted

and

has

now

understood

companied by
Wild

talked

body

are

the social security
royalties and other taxes that benefit Unions.
£
tkere is fallacy m trying to abofish poverty by th(ise methods. I

gteitt^Thedry bfRelativity. ' Evdryw

ac¬

present method of Collective bargaining •:
whereby

befor^ negotiations Begiwand

"Forgotten Man" is

who seeks to be

produced by the Ein-

was

PRICES

ecanomicany Bifsound and

——

which

un¬

HIGHEST

University of Illinois

sided administratioit of
Wagner Relations Act.
of wage rigidity under aH conditions as

much to inform themselves about
it.
The situation resembled that

dergone
so
riiuch discussi

scores

AMD COMPAMV

By FREDERIC EDWARD LEE

turbed: publico:;confldence-vlfl;-.outf
economy arid produced- confused
welfare,, price
thinking. Everybody talked about controls and
inflation, but no one really did pro duction

century

has

unions fix wages

of ballyhoo, propaganda and misinformatibn^ the public atlong last- isgraduallybeingenlightened on the
true aspect of
inflation.

ProL Lee

stability.

•

Professor of Economics,

Points out "inflation"
simple concept and like term "disease" has a variety of
causes and manifestations.
Holds nation was not seriously threatj ened with drastic inflation, such as has taken place in war devas¬
tated countries, though, as in case of all previous major
wars, there
have been some unavoidable
pric^ increases.
is not

liiitnsifir

GENERAL BUILDERS

companying

SUPPLY CORP.
Common & Preferred

produced not

only

citizen is

fear complex among the
people but, in addition, has disa

aware

(Continued

of an overdrawn
on

page

378)

Control of Spreads

Analysis of the Federal
Reserve Board Report
By AUBREY G. LANSTON

some statements

Reserve Board rest

conclusions

motioit to open

and conclusions of-Federal

-m^ASD

same

facts id Herrick, Waddell

rtctifd denied. Review

ou ^59^

;

St., Chicago 3

District

case.

Boston

Governors

•

problems, con-fronting the country in the

they are directed are likely to be
continuing ones unless * present
controls and policies are changed
Atthistlrneitis

fields of mon-

Iieved

credit respon¬

some

"aiterna t i

find

"alternative

some

ures" may increase.

v e •

(Con inued

are

interested in

meas¬

Consequently,

"page 3T4)

•

Laclede-Christy Clay

Nationwide

ation which,

MARKETING FACILITIES

would \rnate- I vrzp
,

was
page

Board

tions

system.
vocative.

detailed

over

Est. 1926

RlOt
Members New York Security Dealers
Assn.

170

charged WltK violating

Broadway
WOrth 2-0300
Bell System Teletype NY J-84

Haylian Corporation

384)

Ptmta Alegre Sugar

U. S. SugarJ

•

* *

American Bantam Car

Utility and Industrial

PREFERRED STOCKS

Lea Fabrics

offerings of

Fidelity Electric Co.
Class A Common Stock

Susquehanna Mills

underwritings

•

Co,

ihe.ipowers of.
the

Products

National Associ¬

High Grade

Public

consider¬

rially increase

MAMFTS

Eastern Sugar Assoc.

pleasures" for v
Congressional : •

it ^approved,*5

respcndent

(Continued

Chicago
Nevi York \ b

AxeBsoit Mfg. Co*

Washington

Dealers, fil^cbmplaints against Herrick,
Waddell & Co., urging that the respondent in
effect, had
taken improper spreads in various transactions.

Cleveland

Thiokol Corp.

•

ation of Securities

r7ir'ffpfeCfiBc^ir^ the

TRAblNG

that

Congress would ap¬
prove
the
suggestions outlined.
Eventually, however, the pressure

etary. and
sibilities.
outlines

district Business Conduct C^mfnittee of the

broad,

the

„

to* Angeles

Rift

^lace in bhsineSSr

District Business Conduct Committee and the
the Federal Reserve Board for .1945 is an
important document because it presumably presents the views of the

/.Richmond' 4321

dell &

The Annual Report of

TWX CO 616

Private Wires:

Salle

68 Devonshire St., Boston

by the Securities and Exchange Com-

h\-

opposite
Intermediate

merits still pending.

So.

Co,, Inc., for the opening of the record in disciplinary
d
proceedings pending Against it, sel'Veist i&
•
:|> appear to be illogical and inaccurate, and that less rigidity iu iatesr > inherent in all attempts to control profits and spreads in the
securities field.
would not affect Treasury costs. JSayn Treasury could afford to see
v
- —
;
j The case arose in the following way. >
~f short-term jrates rise to 1%%* and that thelaltern^ive measures
I Based on reported returns to the 1944 questionnaire, and
3 Urgedby Board shoutd.be tried only in event change in interest rate
ori the identical facts eontcdhedith^eih, both the New-'YorlK
pattern proves inadequate.
The Importance of the Report

.Exchange PL, New York

;fWX NY; 1-2733-4-8

„

1;!1 Pktciiiialiam bas

The recent release

debatable assumptions or premises.

Attacks Board's rejection of measures that would permit higher short*tid maintain* that Treasui^ financing toUsiderations, which Board offers as one reason for continuing low rates,
on

HAnov^ 2-4785 :
39

5% ' spread mterprefation confusing securities industry.
Business (^ftduct C^writteei 0^
Reach

Request ]'

Randolph 8924

Vice-President, The First Boston Corporation

§ Mr. Lanston holds
•

crti

J.F. Reilly & Co., inc.

Highlighted

i ?

Prospectus?

opera¬

SECONDARY*

the commercial banking

These measures .are

pro¬
The problems to which

25 Broad Street. New York

^^lepionclf&dver

PISTRIBOTIONS

2-4300
-YoV*J|tV

"v ''

DUNNE &CO.
;

teletype NY $4

Members New York Security Deaters Assn*

25 Broad St., New York 4, NJ Y.
WHitehall

3-02TJ5-—Teletype NY 1-988

Private Wire to Boston

Blocks of

TfTLE; COMPANY^ ^

UNLISTED SECURITIES

CERTIFICATES
Bond & Mtge. Guar. Co.

Members N; Y* Security Dealers

Prudence Co.
YjT" *" /v*

-N-.

1Vh:i

Member$ New York Stock
Exchange

Board of Trade Bldg.
CHICAGO 4

Direct Wire Service

■

Trust Co.

.ea (ilteRssE^

fC^ns' as&ty—Los ..Angele^;;;

Trinity Places

t r&ephone:'

Yort

Prospectus

upon

request-

C. E. Unterberg & Co.

ESTABLISBEU IS 1

Incorporated

Public National Bank A

Now York—^-Chicago—-St. Louis

Dunean

kssn.r

THglW 4-8W0
^ ";" • Harrison 2075
Teletype NY 1.832. 83+
Teletype CO 139

Newburger, Loeb & Co.
l& Broad St, NX 5 >

Broadway

NEW YORK 4

Shoes

National Radiator Co.
v

STRAUSS BROS.

Title & Mtge. Co.
'*

'"Miles

Piedmont Manuf acturing Company

Lawyer* Title & Guar. Co.
7

Victor-Monaghaii Company

stitutions and individ,ual holders

Lawyers Mortgage Co.

♦Parks Aircraft
Sales & Service, Inc.

Jj'P^Steven# & Gompany

Inquiries- invitefc front dealers J
estates ficorpordti6nst banks; i?H

Members N.

Security Dealers Ass'n *

Broadway, New York 6, N. Y.

Telephone BOwling Green 9-3568
Teletype NY 1-1666

FINANCIAL CHRONICLE;

THE COMMERCIAL

336

Ward & Co.

•

....

•

' '/'•« n

The Chinese Market

that in immediate future United,
exporter to China, because

our

volume of

Pfd.

our^

exports.

industrialization oh the pat¬
imports in the next five to ten years? The present

What will be the effects of China's

'Automatic Instrument

tern of

Chinese

article

.ah

;

Qgoods,

(11)
"intermediate
goods,"
and; (III)
consumers'
goods. The items included in. the
category of capital goods are elec¬
trical
machinery,
textile
ma¬
chinery, hand: and machine tools,
boilers, steam and. gas engines,
food processing machinery, pump¬
ing : and agricultural' machinery,
iron and steel, non-ferrous metals,
railway construction materials and
equipment; etc; The group of "in¬
termediate goods" consists mainly,
though : by; no means exclusively*
of raw materials, which can be

attempt to
this

answer

The
under

question.

Barcalo Mfg. Co.*

period

consideration

Cinecolor

of
only

covers,

Chicago R. I. & Pac.
*

course,

initial

the

of an
industrializa¬

stages

Diebold Inc.

tion
process
which
is

District Theatresf

Douglas Shoe*
Elec. Refrac. & Alloys
Gt. Amer. Industries

bound

ex¬

tend

over

few

decades

utilized either

But

least.

while we
not

Hartford-Empire Co.*

Y. L. Wu

are :

concerned

/.'V:

ized

Lanova*

light on

Mastic Asphalt

our

throw

the latter, we

in order to discover

recognize the short-run
tendencies first. That these shortrun tendencies are both interest¬
have

Michigan Chemical
Missouri Pac..
Old Pfd.

Mohawk Rubber*

N.Y. New Hav. & Hart.
N. 0. Texas & Mexico

Purolator Prodi*
-

Taylor-Wharton*
Tenn. Products
Thomas Steelf

Upson Corp.*
U. S. Air Conditionbg
Vacuum Concrete

ma¬

&<3>M
auc<v

likely to 'fluctuate less

port- is

account can I still come in for
regular interest?"

"If I withdraw my

with industrialization as they can

be put to different uses in the
Commission, was created by the
Owen D. Young Heads
1946 Legislature, which voted a
above
almost
China sense described
Commission
of
N.
Y.
State
equally
well.
Finally,
there
is
a
$100,000 appropriation. It will re¬
or
ManchUria. ;
All ; the
im¬
The appointment by Governor port to the Governor and the Leg¬
ports /are
divided into three third group of consumers' goods
{Continued .on page 368)
Dewey of Owen D.
Young as islature by Feb. 15, 1946.
groups;
namely (I) Capital
Chairman of the 30-member com¬
In special advices from Albany
mission of New York State which on July 14 the New York "Times"
is to determine whether a uni¬ reported as follows as to others
versity is desirable for the State who will serve on the committee:'
*The FR Corporation
^District
was made known in press accounts
The
Governor
also appointed
from
Albany on July 14.
Mr. Oliver Cromwell Carmichael of
*Stratford Pen Corp.
*Loew Drug Co., Inc.
Young, retired industrialist and New York City, President of the
former member of the Board of
^Princess Vogue Shops
Carnegie Foundation for the Ad¬
Regents, is a Democrat; he was vancement of Teaching, and for¬
*HungerfordPIas. Corp.
formerly Chairman of the Board mer
Chancellor
of
Vanderbilt
of
General Electric
Co. and a
'ProspectusAoaitalf
University, as Vice-Chairman.
decade ago he headed an official

Provinces of

Northeastern

Theatres Corp.

*EIect Corp. of Amer.
*Dumont Electric Corp.

Members

York

New

made

the

ex¬

cost

and

the

education

character

New York 5, N. Y.

The COMMERCIAL

commission,

new

known

the

William

Bought

^Capital Records

Spec. Part,

v;:

Aeronca Aircraft Com. & Pfd.

; |v

Corporation

ESTABLISHED 1927

22 East 40th

j.K.Rice,Jr.&Co.

Established 1908

Street, New York 16, N. Y.

Members N.

Teletype: NY 1-2948

Telephone: LExington 2-7300

tProspectus Upon Request
*

Bulletin

REctor

Y. Security Dealers Assn.

Teletype N. Y. 1-714

Circular upon requett

Thursday

every

(general news and
and every
a#

(complete

f/V

.:.il

corporation news, bank clear¬

ings* state and city news,
Offices:

Other

;

Monday
•

•

advertising issue)

statistical issue—market quota¬

tion records,

Broadway

2-4500—120

Bell System

;

Published twice a week
,

^Prospectus on requett

Central National

President

Business Manager

Thursday, July 18,1946

Southwest Natural Gas

Standard Gas Elec.

Preferred

ELECTRIC BOAT €0. Clint. Conv. $2

Publisher

and

EiggS,

William D.

Kingan & Co. Common

MIDLAND UTILITIES COMPANY

Seibert,

William Dana Seibert,

MIDLAND REALIZATION CO.

New England P. S. Coin.

Southeastern Corp.

Haile Mines

to 9576

2-9570

Herbert
Editor

EASTERN CORPORATION

Iowa Pub. Ser. Com.

Company

Publishers

Park Place, New York 8
REctor

Quoted

Sold

Dana

University

State

'American Gas & Pow.

Puget S'nd P. & L. Com.

U. S. Patent Office

Reg.

| The

and

FINANCIAL CHRONICLE

State.

Teletype NY 1-2425

Tel. HAnover 2-8080

study

haustive

Security Dealers Association

Wall Street

which

committee

FIRST COLONY CORPORATION

Textron Wrnts. & Pfd.

Cent. States Elec., Com.

imports; inta the

however

Alabama Mills*

Aspinook Corp.*

■

import data of the Maritime Cus¬
toms of China in 1935-37, exclud¬

ing,

old pri.

building

other

and

timber

terials, petroleum, rubber, coal,
ing- and important will, we be¬ dyCs, chemicals, cotton,;WOol, flax,
scientific instruments, cars, planes,
lieve, become quite clear as we
proceed.
'
'
*
ships, etc. An important ^char¬
The following table is the sum¬ acteristic of this group of "inter¬
mediate goods" is that their im¬
mary of a detailed analysis of the
,

Moxie

purpose

industrial¬
analysis may
some useful
the long-term trend. For

China,

nevertheless

factors of pro¬

or less, directly for the
of consumption—for in¬
stance, after a little processing.
Roughly speaking, these commod¬
ities may also be designated as
"producers' goods," as distinct
from "capital goods." Commodities
falling under this category 1 are
or

'•

long-run pattern of

here with the

as*

duction in a roundabout manner

imports of an already

Jessop Steel

■'

supplant Great Britain

and hence will determine both the nature and

'Amer.Window Glass*

Richardson Co.

CV-

Economic and Social Council

States will

American Bantam Car

Old Pfd.

greater capacity to make necessary loans and invesbnents.
Such investments will govern China's foreign tra.de control policy,

Aero Chemicalf

BUSINESSiBUZZ

Chinese Government official predicts
of

•

Thursday, July 18,1946

Ci:

f*{ "*

k.:'<fc'v.'V.-'1if..it'.

■!&.'.

Com. &

.» -s

Daring industrialization
Member 'Chinese Delegation,UN

h r-?

V*.'-

f$T ,1926

;

•:>

135

etc.)

S. La Salle Street

Chicago 3, 111.
(Telephone:
1 Drapers' Gardens, London,

State 0613);
E. C., Eng¬

land, c/o Edwards St Smith.

ACTIVE MARKETS

EQUITABLE

Commodore Hotel, Inc.
•

-v

;

Common Stock

V '

*■

-«
i/. "

'■ "

Waldorf-Astoria Hotel

•

'•

•

'r"■

.'i*£.r.

OFFICE
BLDG.

;

Common Stock
■

Bonds
•

;

& Stocks

1879.

Subscriptions
In
United States andl
Possessions, $26.00 per year; in Dominion
of
Canada, $27.50 per year; South and
Central
America,
Spain,
Mexico,
and
per
year;
Great Britain,
Europe (except Spain), Asia.

$29.50

Cuba,

Continental

Incorporated

Members New York Security Dealers Association

41 Broad Street, New

York 4

HAnovmr 2-2100

$31.00 per year.

Other Publications
Bank
.

SIEGEL & CO.
N.Y. 0

Telotjpa NY

DIgby 4-2870

1-194*^1^';

;"
[

Record—Mth._$25 yr.
Record—Mth
$25 yr.

and Quotation

Monthly

Earnings

NOTE—On
89 Broadway,

second-class matter Feb¬
ruary 25, 1942, at the post office at New
York, N. Y., under the Act of March 3,
Reentered

Australia and Africa,.

Seligman, Lubetkin \1
& Co.

Dana ;;

the

foreign

rate

account of the fluctuations
of exchange, remittances for

subscriptions
vMAdn

xtqttt

and

Vnrlr

advertisements
fnnrfa

•i

.Volume

J 64

•'

".A V' '-f /
y. ' -i M
>ynu>:
THE COMMERCIAL •& FINANCIAL CHRONICLE
■

Number 4S08.

Problems In International Trade Spiegelberg & Co.
Formed in New York
Spiegeiberg & Co. has-been
in New York
City with
offices at 30 Broad Street to.en¬

formed

gage

the

securities

Partners of the
liam, I;
the

new

Spiegelberg,

business."

firm

are

Wil¬

a* member of

New; York Stock Exchange,

Jess L.

^Geisman,-

Gottlieb; < All

and Harold M.

w^ere-formerljKpart-

in Friedman & Co.

ners

Geo. G. Birkins in N. Y.¬
George G. Birkins is engaging
in the securities business
from of¬

fices

107

Washington Street,

New York City.

CANADIAN

SECURITIES

Internal Issues

Public

Utility and

Industrial Bonds

Leading
Banks and Trust

■
52 WILLIAM ST., N. Y, 5

Companies

Bell

New York

of New York
57th CONSECUTIVE

HAnover 2-0980

Teletype NY 1-395
Montreal

Toronto

QUARTERLY COMPARISON

BENDIX HOME APPLIANCES
Available

request

*GEN.

BUILDERS "S UPPLY
Com.

New York Hanseatic
120

Corporation

Direct Private Wire Service

Teletype: NY

COAST-TO

1-583

New York

**HIGGINS INC.

Baker Raulang

Jefferson

Lake

Com.

Eliminator

American Insulator

•

St Louis

COAST

Kansas City

KELLETT AIRCRAFT

Los Angeles

*TIMELY CLOTHES

Broadway

NEW YORK 4

Standard Fruit & S/S

DIgby 4-8640
Teletype NY 1-832-834

Com.

Pfd.

American Beverage

Preferred

T. I. FEIBLEMAN & CO.

ST.

Bell

Harrison

Teletype

**Circular

2075

Baum, Bernheimer Co.

LOUIS^;^^0

Carondelet Bldg.

;i KANSAS CITY

LOS ANGELES

2-4785

TWX NY

La Salle St.,

Randolph 8924 ■*.¥■
68

Devonshire

Private Wires;.
Cleveland

Boston

American Gas &

Securities

Products, Inc. Com. & "A"

^Universal

York Curb

New York 6

Teletype NY X-1610

Prospectus

Bought

—

Sold

Prospectus

Chicago

Expreso Aereo

Kinney CoastalOil

Propane Gas Corp.$

Equity Oil

Tennessee Gas & Transmission Co. *

request

New York

Utah Southern Oil

Quoted

on request

Reynolds & Co.

Exchange }?

Members

Chicago Stock Exchange

39 Broadway
Digby 4-3122.

Petroleum Heat & Power

Suburban

$2.40 Conv. Preferred

WALTER KANE, Asst. Mgr.

Members New

Winding Co. Com.

Power

Dravo Corp.*
Ohio Match' Co.

^Raytheon Manufacturing Co.

MICHAEL HEANEY, Mgr.

TWX CO 616

Richmond 4321

Tel.—NY-1-498

*Air

1-2733-4-5

Chicago 3

St., Boston- 9

Los Angeles

Curb and Unlisted

Request

Exchange PI., New York 5
So.

Pltdger & Company, Inc.

New Orleans 12, La.

Request

on
on

J. F. Reilly & Co., inc.

129

HAnover

Company

Members New Orleans Stock
Exchange

Bo. 9-4482

^Prospectus

Board of Trade Bldg.
CHICAGO 4

!<rt

White &

New York 4, N. Y.
41 Broad St.

Bought—Sold—Quoted

Members New York Security Dealers Ass*n

Lane Cotton Mills
Corp.

Common

32 Broadway, New York
4, N. Y.
Yd. WHHtehall 4-6430
Tela NY 1-2500

Chicago

STRAUSS BROS.

Sulphur

Pfd.

Jonas & Naumburg

PETER BARKEN

Galveston Houston

Carbon Monoxide

Pfd.

BROADWAY, NEW YORK 5, N. Y.

Telephone: BArclay 7-5660

Preferred

'120

New

York

Stock

Exchange
,

Broadway, New York 5, N. Y.

Established 1888

67: Wall Street,; New!York 5

Telephone;
Bell

REctor 2-^600^-

Teletype;

NY 1-635

MEMBERS N.
tree V

Y. SECURITY DEALERS ASSOCIATION

New York 8» N^Y.

„

■

Bell Teletype NY'1*607

Telephone'HAnover 2-933$
Teletype NY

3-263O-iYY0[

the

Director
War
rz a

Mobziliand

o n

man

tiled his

July
John R. Steelman

|covers the

It is

sec~i

of
-<..•••••> -v-.

|
In the year since the Nation be¬
gan to reconvert from war tcj
J peace, two inseparable objectives

-$3.00.

•:

•

Chronicle)

(Special, to The Financial

IOWA

DAVENPORT,
wick

—

Hart

has rejoined the

Sweet

,Total production of goods hntf, staff pf Priester & Co., Davenport
services stands at the highest ptoint
Bank Building, after serving in
in

peacetime history.

Production

the U. S, Navy,

of over-the-counter consumer
goods for the first half of 1946
was the highest in either
peace or
i

Quail & Co.

Joins

| have dominated

the
we

made

tiles, housing and veterans wel*
Inventors' Magna Charta, The—
; fare. The first part of the first
section discusses price control and "Edwin Hopkins—Basic rights of
fiscal and monetary policies in re¬ inventors and rehabilitation of the
flation to stabilization.* These mat-* Patent System discussed—Edwir
ters are discussed in the report a3 Hopkins, Publisher, 255 W.43
i follows:
New.
13, n. y.—j

the economy—
production and stabilization. We
have made good progress on botht

take

ress

I I

second ?

(Special to The Financial Chronicle)

DAVENPORT, IOWA—Hugo C.
Up to the time when the price
control act expired, stabilization
Arp, jr. has become connected
'

of the economy had been success¬
with Quaty & Qo* Davenport Bank
ful within the broad patterns laid
Building, after serving in the U. S.
down by national policy.
Some
x-v
■
•
!
ground had ben lost, but it was Army,

after, to allow: the price

dustries- from

ments

it-

ing to

Robert R. Wason

prog¬
have

JM>,: ijfj
-

-which a good many
people have been inclined to over-;
look in the heat of debate. ;Up to used for the purchase of capital
June 30 the setbacks which we goods in the United States.
suffered had been disproportion¬
: .Ethiopia's
present, shortage of
ately magnified.
.
dollars is due both to the large
The facts are that:
demand for her products in the
Production by mid-year reach¬ Middle East and to the difficulty
ed the highest level ever attained
pf
transporting
goods
to
the
in peacetime.
U.S.A.
,{
More people are working now
than
ever
before — four-and-a- 4 At present Ethiopia receives
half million more than-in 1941, only Sterling Area currencies for
her exports. This is true even of
our
highest prewar year.
Par¬
those products which are sold, to
ticularly gratifying is the fact thai
the U. S. A. Ethiopia has no port
eight out of every, ten returned
and as a result all exports to the
veterans already have jobs; but
U. S. A. must be shipped from
we shall not be satisfied until the
Aden.
Before the
exporter
is
.

suitable
opportunities. The
number
of - people
looking for
(Continued on page 370)
veterans have

employment

Tennessee
American

granted space from that port he
must surrender to the British Ex¬
change Control for currencies of
the Sterling Area the U. S. dollars

Properties

N. Y. & Rich.

National

and

Railroad, Industrial
Public

Gas

Inc.

N.T. 4 -s

Members New York
? 68

-27 Stato St.,

William St.

Stock Exchange

Devonshire St.
Boston 10

New York 5

Knowledge

Steep Rock Iron Mines,

quality Railroad Equipment equity
has been paying 20 cents per quarter.
—

Blair F. Claybaugh
Members

WALL

& Co.

Philadelphia Stock Exchange

Tele. NY 1-2178

Harrisburg-Pittsburgh-Syracuse-Miami Beach

*;s"

ST., NEW YORK 5, N. Y.

HANOVER 2-7064

*Can. Western Lumber Co.,
•*

;

Ltd,

*Circular

• r

;

FR Corporation

request

MAKER &HULSEBOSCH
Brokers
In

Investment

Dealers

Securities

Super-Cold Corp.

;

New York 5, N. Y.
Telephone
Teletype [
WHitehaU 4-2422
NY 1-2613
Branch Office
..
'

Bought

■

113 Hudson St., Jersey City,

Member of National

—

Quoted

Association

of Securities Dealers,

HAnover

Inc.

Street, New York 5 ,
2-1140
Teletype NY 1-2096

Wall

N. J.

Sold

R. G. ILSLEY&CO.

62 William St.

—

10, 1945

to Sept.

3,052,676.00

8,524,955.91

exports over imports

5 \

remit¬

tances
Exc.

$35,757,170.74
non-trade

Outward

$47,334,802.65

Ethiopian

$33,940,512.65

Exports
non-trade

Inward

remit-

8,934,730.00
2,144,120.00

Gold exports

Silver exports

$47,334,802.65

Ethiopian

2,315,440,00

tances

Ethiopian

that

estimated

$1,000,000 per

year

since

This cannot be taken as a
of future earnings as ex¬

Ethiopian

States will un¬

coffee has beeri

shipments of beeswax have gone
entirely to Great Britain as a war
measure.
There has been only a
small market for civet musk be¬
cause of the shortage of industrial
alcohol for perfumes.
Hide and
skin shipments have been smaller
than before the war because far¬
mers are building up their herds
and flocks and are reluctant to
sell livestock; Given an increase
in imports of textiles to bring out
produce for export and an im¬
provement in shipping space to
the United States, Ethiopia's earn¬
ings of dollars should greatly
crease in the next fevir years.

in¬
-

•

Ethiopia is primarily an agri¬

growing

Magor Circular CC mailed upon ^request,

■

-r

Linn Coach & Truck i

MAGOR CAR CORPORATION

well managed

Facilities

Cosmo Records

Ltd. I

V.T.C.

—

Experience •
•
i°r Investors

NY 1-1026

TO INVESTMENT DEALERS

sound

'v*

•

1944

Imports

Stocks

201

10,

Sept.

PAYMENTS

coming to the United States be¬
cause of shipping difficulties and
low U. S. ceiling prices. Ethiopian

R.W.Pressprich&Co.
tl Broadway,

BALANCE

measure

Reel

111 BROADWAY, NEW YORK 6, N. Y.
,

:'t

BONDS

ON REQUEST

first

follows:

last fiscal year was as

ports to the United
doubtedly increase.

Utility

•Investment

the

for

returns

quarter of the current year showed
a favorable balance of Ethiopian
dollars 5 million (U. S. $2,000,000)f
The balance of payments for the

1941.

Shirt Shop

Montague Rod &

Customs

000

Municipal

Members N, y. Security Dealers Ass'n

BArday 7-0570;

u. s,

exports to the United States have
earned an average of U. S: $750,*

United States Government
State

be able

products

for her to borrow dol?
to buy from the

necessary

Jars

Works

Vitrified Products

Washington

and jt operating

domestically ^with budgetary surplus. But exchange restrictions
necessitate borrowing to buy in American market, j ?
\* /
The Export-Import Bank has officially announced the granting
of a loan to Ethiopia in the araoujnt of $3,000,000; Interest is at the
rate of 3%. and amortization pay-^
ments, which begin on June 30, a result, although Ethiopia enjoys
balance; of payments
1951,-are to be made in 12 equal a
- favorable
'
semi-annual instalments. The en¬ and has built up substantial bal-j
tire proceeds of the loan are to be anqes of other currencies it 13

President Truman

and figures

rest of our

Ethioma-

Ethiopia has, Favorable balance \ of payments,

H. D. KNOX &
.

pay

Our Loan to

of us
stock-

DELAWARE RAYON "GLASS A"

F. H. KOLLER & CO.,

partment incited union leadersUo
demands by allowing
'news leaks' on a study purport¬

good
time,

employment. * - ' *'•
John R. Steelman-s report on
reconversion sets forth some facts

1939-1945

make wage

As¬

National Press Bldg.

CIRCULAR

been

show that industry could
higher wages without raising
prices. By the ? time secretary
V
born insistence that prices be held Wallace had repudiated the study
M
down in the face of demands for the damage had been done.
"President Truman's policy of
higher
wages
is primarily
to
(Continued on page 355)
blame for these production losses,

Richmond Cedar

Paid $1*50 Annually

industries might have
avoided,", Mr., Wason,. dedared. "*Tirst the^ Commerce De¬
and copper

turers.^) v vy
f; QPA's stub-

n g

^toward

Approximate Market 22l/z-23l/2

compensation ,to industry

partial

Manufac¬

peacetime domestic goal of
sustained full production and full

Approximate Market 25 l/2-261/2

adjust^

actually made later ag a

wage
rises, then disastrous
walkouts in the automobile, steel,

paid by the U. S. A. importer. As

1939-1945

before

for

an¬

sociation:,

LOOKING FOR INCOME?

Paid $1.75 Annually

wafe

nounced

our

NEW BEDFORD RAYON "GLASS A"

agreed

;were^ callody instead ; of

with basic in¬

With Prieiter & Co.

war.

strikes

tiQn schedules,

occupied; by

had

OPA

"If

1946

K. Wason,

according to Robert
NAM President.

July 15 by the

jaeconddiscussing special pro-;
) grams, such as famine relief, tex4.

from

all

for

v;;| duction and stabilization, and the

time

the
began

National"

the

11,

thing,

pro-}

1 tions, the

the

half

statement:

July. 1, "At
The
docu-1

is divided into
two
first dealing »with

i ment

Business

of re¬

Crossroads."

the

Federali

nation

issued on

follow i

| report, which
conversion

officials,

points in "the development of the President
(Continued on page 364); Harry S. Tru¬

Steelman has

progress

£t ri

have greater amount

now

Of War Mobilization and Recohver¬

der, now Sec¬
retary of the
Treasury. Mr,

1With more than a hundred million mari^days Wasted in strikes
since VJrDay*- largely as n Result of
jhisteken poUcies^- el OPA.

report of Director of War Mobiliza¬
tion and Reconversion, states 'we

flation had been prevented.
v.;
sion, a position
These two all-important-objec-v John R. Steel¬
tives have been pressed in the man, who re¬
face of extreme difficulty. Labor- cently
suc¬
management disputes have tied ceeded John
up
basic industries at crucial W. Snyder,

only recently
succeeded
John W. Sny¬

I en

helped to hamstring business;

optimistic

,
considered possible .or
21'to 73% be-A
sirable to hold an inflexible line view of fiscal and monetary policies
hind -their
indefinitely against the upward /.'Jri a statement* commenting- on
1946.; produc-: 5
pressure of prices and. wages.Cer- the Seventh Report of the Director

neper

Jieconverkioiv
a position held
*t>y
John R.
Steelman, who

President, In comment on

of. employ¬
ment, greater earnings and greater
volume of purchases than ever be¬
fore/ Holds ninawaylnflatibiijias
de¬ b.een prevented and promises re¬

port

Robert R. Wason estimates production from'21 to 73% behind
1946 schedules. Says Administration's wage and price policies

Stressed:Truman

Congress, entitled At,, the ,
control jxessenti^ to avoid:
;:f Inflation and bring about orderly stabilization. Holds consols taust
:
not remove incentive to produce, and niust be workable, fair end
flexible. Offers as fiscal Mmonetary policy^0) ^rtadment ot
public-expenditures; (2)„anfl.iiiflationary tax.and debt poliaesf
and (3) strict control of private credit expansion.
■ . ■
On July 11, while the Senate was stUl debating the new Price
Control Bill, President Truman released the Seventh Quarterly ReIn quarterly report to President and
Crossroads/^ ho states workable jprice

Lays Production

Losses To OPA

Policy Delays Unduly

Control and Fiscal

NAM

Reconversion

Steelman Charts Piice

Thursday, July 18,1946

FINANCIAL CHRONICLE

THE COMMERCIAL &

cultural

country.

Nearly two-:
consists of

thirds of her territory

a high plateau which has a tem¬
perate climate with a mean tem¬
perature of about 75 degrees. This
area is
several times the size of

The r e m a in i n g
and consists both of
desert and dense tronical iungle.

Pennsylvania.
third is lower

(Continued on pag

Volume

Number. 4508.

164

339

OPA Removal and Stock Prices

Caution Needed in Consumer

Member, Research Staff, Smith, Barney & Co.

Deputy Manager, American Bankers Association

••••*

••

.-•U-

■
.

that stimulation of

itself."

clash *

between

do have a free economy, at least
freer
'
economy than at any timo in

tion's desire to

recent years, and every

get

passes

strihgent
OPA legisla¬
tion

back

the books and
the conviction
of

of
that

group

Senators
the

„

Edson Gould

way

have

would

say

cept

rents)

for

modified

workers and investors.

so complex an
admixture of

the least, rather
we

and

opinions ex¬
pressed are those of Mr. Gould,
and
not
necessarily
those
of
Smith, Barney & Co.

leaders,

banks

should

noth¬

ing

about

that.

The

is that OPA has not

reason

held down prices, when consider¬
ation is given black markets and

subsidy costs, but most certainly
has
interfered with production,
and production is the one need of

have

fairly sharp
commodity prices over the

may

rise in

small

/Continued

379)

naee

the

Department

Com¬

For

the present, the idea
is to have the department furnish
the

small

kinds

business

man

with

all

financial advice but not

make him

loan.

tary 'admonishes

The

banks

the alert and to do

ness
to

The

Financial

Chronicle,

Devonshire Street.

AKRON,
Mercur

OHIO — Nathan
L.
joined the s.aff of
Browning & Co., First

has

Nelson,

with H. C. Wainwright & Co.
Chace, Whiteside & Co.

was

and

(Special

The

BOSTON,
to

The

Financial

Chronicle!

Financial

MASS.

Chronicle)

—

Bemis has become affiliated with

the

Mahar, James P. O'Neill and

Fred S. Troy, Jr. are with Draper,
Sears & Co., 53 State Street.

(Special to The Financial

rison
(Special

The

Financial

Chronicle)

and

become

Robert

connected

Mara

with

have

II.

BOSTON, MASS.—Jacob Stollin Wainwright &
Co., 60 State Street.
has
been

General

added

Stock

the

Bond

staff

Corp.,

(Special to The Financial

Post Office Square.

CINCINNATI,
R.

(Special

to The Financial

Chronicle)

loans

with

during

The only thing that would

iness

production

Perry

The

Financial

Davis is

now

—

with

Howard

Wasson

produc¬

order

their

the mone^y

war

has

get back into
been largely oa

government guar¬
The increase in loans for

own—no

anties.

production and commercial

pur-*

been

demands

have

from

billion

John

have

that

been

need most are .loans

for

production. It is neces¬
sary
for American f industry to
produce fast and in quantity if

now

are, to

avoid further inflation*

ary inrbads. The pent-up demand
for consumer goods, plus plenty
of money

and credit, calls for pro¬

duction—and fast—not

ulation.

offi¬

give

a new

reg¬

two

very

you

homey illustrations of what hap*
pens' despite regulations when,
demand is strong enough, I call
your attention to the meat and
butter market, not as it applies to
any one city or state but to titit
whole country. It's all very well to
(Continued on page 383)

Snyder,

expressed.

One authority

doing

dollars.

What

peace.

declared

was

over

war

almost 25 %

poses

thinks we are not
good lending job, another

past

BOUGHT

AftD SOLD

Securities NOT Participating On

could

Associated Gas <S* Electric C©o

jPlan of Reorganization

dramatically
doing the
job or even cooperating with the
Department of Commerce. Then
he could ask Congress for the
announce

that the banks

were not

Convertible

Obligations Series "A" and "B:>

5%, 5Vz%, 6%,
dna%%6
PrpfppTArf

Preference Stocks '

$4, $5, $5.50, $6 and $6.50 Dividend Serisa

yet, guarantee the

or, worse

Class "A" and Common

loans made by banks.
On the

other

10th

hand, only

few

G. A. Saxton &

Mr. French be¬

Carolina

^tnplrQ

$5, $5.50, $6, $6.50 and $7 Dividend SeriC3

right to make direct loans to busi¬

fore

Chronicle)

CLEVELAND, OHIO
II.

Chronicle)

BOSTON, MASS.—John E. An¬
witlfi Gregg, Storer & Co.,
Inc., 35 Congress Street.

its

language meant
one thing—the Secretary was
paving the way for the time when

*An address by
(Special

and

finally arriving at

Now to me that

ness

OHIO —Stanley
Victor

close of the

bubble is

commercial

the

years."

joined the staff of Westheimer & Co., 326 Walnut Street.

with J. H. Goddard & Co., 85 Dev¬
onshire Street.
to The Financial

and

the

of production pur¬

take the pressure off the inflation

views

proposed plan will

connection

have

BOSTON, MASS.—Montgomery
Farrington has become associated

(Special

Hansen

Chronicle)

financing

rowers

BOSTON, MASS.—Fred H. Har¬

advanced .by banks for, reconvert
sion and supplying credit to- bua-.

BOSTON, MASS.—Paul F. Co¬ White, Weld & Co., Ill Devonshire
just
lumbia, Alan B. Goldberg, Harold Street.
W.

task

and all kinds

There is just a little inconsistent
thinking, it seems to me, in the

only if much more thought
supervision is given to bor¬
than has been customary

and

bank

Grosvenor

but

the

anteed under Regulation V. Since,

cially

succeed

Central Tower.
(Special

In the past he

met

appears to me that at the moment
should encourage loans for any

former reconversion director, some
few weeks ago.

back into the character loan busi¬
(Special

Mr.

war

production in a very com-,
mendable way. True, about half
of the outstandings were guar¬

kind

Reconversion

ing job. Here is what he said:
"The Department of Commerce's
plan would enable banks to get

an
outstanding
that I go along
Snyder? I think the

say

regulation is
necessary. I don't know whether
he thinks it is necessary now. It

this

reconversion

Secre¬

better lend¬

have

banks

agree

some kind of
third thinks the

a
done

Need I

with

a num^

who

men

stage where
satisfied,
goods in increasing volume should
soon be flowing into the market.
It was a refreshing change not
so long ago
to have one official
in Washington say that the banks
deserved a pat on the back for the
fine work they did in financing

service

financial

business

within
merce.

Bankers

Con¬

Co., In©*

70 Pine Street, New York 5, N. Y*
WHitehall 4-4970
Teletype NY 1-C00

ference, Chapel Hill, North Caro¬
lina, July 9, 1946.

Company of Ohio*

drews is

(Special

The

Financial

chronicle)

DETROIT, MICH.—William D.
1
-

(Special

to The

BOSTON,

Financial

MASS.

Grim is

Chronicle)

—

James

Danahay is with R. H. Johnson &
Co., 30 State Street.
(Special

The

Financial

Chronicle)

now with Bennett, Smith
Co., Fenobscot Building.

(Special

The

BOSTON,

Financial

MASS.

Joseph

—

Franklin Street.

Inc.,

□ Canadian Western Lumber Co.

Kaiser a Co.

COMMON STOCK

to The

Financial

Chronicle)

; BOSTON,

MASS. —George A,
Hodges
has
become
associated
With Vance, Sanders Sc Co., ill

The

Financial

DETROIT, MICH.

Chronicle)

—

NEW YORK

LOS

Building.

EXQHANGE

ANGELES

EXCHANGE

□ American States Utilities

STOCK EXCHANGE

».

STOCK EXCHANGE

Bought and Sold

W. Marshall has been added to the
staff of Moreland & Co., Penob¬
scot

CURB

FRANCISCO

SAN

Lloyd W.

□ Marchant Calculating Machine

MEMBERS
NEW YORK STOCK

(Special

□ Honolulu* Oil Corporation

Cresswell

has become affiliated
Edward E. Mailhews Co., 53
State Street.

IN THE JULY ISSUE:

DEALERS"

with

BOSTON, MASS.— Norman U.

"IDEAS FOR

Iowa

Chronicle)

Baker has become connected with
F.
L.
Putnam
&
Co.,

SPOKANE

SEATTLE

FRANCISCO

SAN

NEW YORK

■Analysis and Prospectus
on

request

local stocks

[Gold]
(From

Josephtfial&Co.
Members New York Stock Exchange
New Work Curb. Exchange:
and other

The

Robinson-Humphrey Company
Established J894

RHODES-HAVERTY BIDG.
i
Teletype AT, 288 „ .

ATLANTA U GEORGIA
v

Long Distance it)8-

Balatoc Mining

Benguet Consolidated Mining

state and municipal bonds

corporateIbonds

Exchanges

12ft Broadway, New York '5
;

since -V-33
conversion but that job has been Day.
Loans in banks for these
purposes
are
about completed; and with labor
now well over 11

French

to-quote from Secretary Wallace's
testimony before a congressional
committee recently when he was
asking for permission to set up a

prevent both infla¬

tion and deflation.

Walter

Permit

banks

job.

tion of all kinds of consumer
goods. Undoubtedly a large per¬
centage of the money borrowed in
the past six months has gone into

do.

There's

thinking

poses.
-

doing the job
they could or

new

be subject to

now

York,

not

are

that

think that the

Inflation

the nation to

views

greatly
eliminated,

even

Therein

Nevertheless, at the moment
*The

may

regulation, and

ber

by the Secre¬
tary of Com¬
merce,
still

has been predicting, the better the
chance that price controls (ex¬

a war

thinks commercial loans should

loans. Mr. Sproul is one of

commodity; spearheaded-

run-away

development for the nation at
large, for consumers, producers,

hazardous.
.

kind

Sec*

eral Reserve Bank of New

lations

govern-,

ment

price advance the Administration"

economy is to
set it free.
lies

tain

legislation, and without the

which would be the best possible

politics,
eco¬
ideology that a dog¬
prophecy
of
the
result

be, to

weeks ago we read a speech made
by President Sproul of the Fed¬
in which he advocated some
regu¬
to
control
commercial

try are han~
dling the cred¬
it problem of
the day. Cer¬

day that

formulation

free

nomics and
matic

OPA

without

'■'r-'-Av '• A A'-;'.1-AA.

banking and Government leaders,

gwernment express divergent
views on how banks of the coun¬

—

Admini stra-

the

v.;

goods buying could create inflationary forces "more devastating than

scarce

Wlthin thd last few moi^hi
have had leaders in'bariking and

The outlook for business, industry and the market over the bal¬
ance of this year will be largely determined by the outcome of the
current

retary Wallace,-nnd current modification of credit regulations, have confused the "whole current credit
field. Urging that hankers meet their individual responsibility in consumer installment lending, he warns

er.

Bankers' Association official declares recent expressions from

Holding OPA, instead of holding down prices, interfered with pro¬
duction* M?. Gould contends if we get more production, there need
fie no worry of runaway inflation. Says most stock prices have
already risen to high levels and further advance is not likely to
'exceed 12% to 15% through remainder of year.
Lists stocks
'which now offer above average values.

Lending

By WALTER B. FRENCH*

By EDSON GOULD*

Telephone:

REctor 2-5000

1916

Production

;4 '•"*•
,

Dividends
•»*;)'

•-*

••

1941)

1922

Stock
'

•

VrV

Telephone:

Dividends

to 1941)

$56,009,000.
$23,950,000.

5,000,000 shares

Prospectus on request.

O'KANE JR. & CO.
Members N.

42 BROADWAY, NEW

19, Congress St-

1929

Cash Dividends

$36,875,000.

11,000,000 shares

JOHN j.
Established

(From

r-'•.? :*

Co.

owned by Benguet)

Production

$61,800,000.

Cash Dividends

Stock
■i

(64%%

Y. Security Dealers

As^n

YORK

Boston 9

LAfayette 4620

DIgby 4-6320

Teletype NY 1-1525

THE COMMERCIAL & FINANCIAIi CHRONIODE

Thursday, July 18* 1946
—i

BALTIMORE

Associates,

A. W.

has

Inc.

opened offices at 550 Fifth Ave¬

Bayway Terminal

nue;

Davis Coal A Coke

New York City* to engage in

Ins. Co.

of Baltimore

William M. Watts

'STEIN BROS. & BOYCE

—

Watts is engaging
business ~ from

William M.
securities

offices

Exchange.
with

Conrad,

past

Bruce

Genesee Street.

the Los Angeles office.

New York Telephone Rector 2-3327

DES MOINES

Morrow & Co. in
(Special

INCORPORATED

Iowa Power & Light Co.

The Financial

CLEVELAND,

Chronicle)

O. —Frank

with offices in the Hanna Build¬

November;

ing

enough

the

engage

securities

lose

Sioux

John

City Gas & Electric Co.

Preferred and

DES

MOINES

Foster is engaging in

the securities business frdhi offices

Common

BUILDING
9, IOWA

Broad

Street,

New

York

City.

Bell Tele. DM 184

Phone 4-7159

Utah Power &

STREET

1st

Teletype BS 424

ESTABLISHED 1899

Salt Lake City
SYSTEM

1, Utah

TELETYPE SU

nation.

com¬

No wonder Socialists say, "Give
two more terms of the Demo¬

cratic coalition and

inevit¬

land."

munists

will have

Republicans, therefore, must

the

wonder

say,

terms of

"Give

the kind

Com¬

us two more
of administra¬

solution will soon be ours.

Landon be¬
Republicans of
Kansas, Newton, Kansas, July 10,
*An address by Mr.

N. Y. Telephone CAtud 0-8100

the

Young

Inflation

Pressures

President Truman

(Continued

1946.

TRADING MARKETS

Socialism along the lines of Eng¬
Alf M. Landon

be studying the new

fore

PHILADELPHIA

Fascism."

464

Bell Tele. LS186

Long Distance 238-9

badly

teen New Deal years

160 s. Main street

BELL

and

Thir¬ says, "Give us two more terms of
have brought a government like we have had
about
three
major changes in for 13 years and we may have a
America
the
Republican
party totally un-American economic and
must deal with:
political system, whether it be
1. Increase of monopolistic pow- Communism, English Socialism or

Floor, Kentucky Home Life Bldg.
LOUISVILLE 2, KENTUCKY

administered

been

to de¬
moralize the economic life of the

admin¬

home

has

erratically

and rev¬ tion we have had and the country
problems confronting will be ready for Communism."
;he country. The responsibility of No wonder the genuine Liberal

& COMPANY

>HANcock 8200

which

dis¬

olutionary

EDWARD L. BURTON

MILK

2. Increase of labor uniohs, pow¬

er, which we must

inter¬

the

now

Winn & Lovett Grocery

15! BANKERS BOND £*

must break up ruth¬

Amalgamated Sugar

Incorporated

able.

Louisville Gas Pref.

Inquiries invited

rupted by war,
plus the sins

Girdler Corporation

Merchants Distilling Co.

the
o

which

deal with under¬
standing^ and
sympathetically,
but firmly, in the best interests of
labor and the public.
3. Increase of government power

tories

Utah-Idaho Sugar

American Turf Ass'n

request

er,

roost, all make
sweeping Re¬
publican vic¬

Light

this

lessly.^

Rveipublican

cratic

American Air Filter

Descriptive Analysis

istration

LOUISVILLE

BOSTON e, MASS.

*7-s

Republican Party, after predict*

pressure groups.

1948.

success

ing

Mills

'■ .'r ',

that the Republican party will win the election

cordant Demo¬

SALT LAKE CITY

Pont, Homsey Co.

The swing is so marked that we can hardly be maladroit
to
>
®

direction

John C. Foster in N. Y.

Preferreds

normal

trend

United Light & Railways Co.

EQUITABLE

V<V»'*?V;

Republican victory in November, blames New Deal fiscal

It is obvious

The

Utica Knitting

freedom from minority

Morrow has formed Morrow & Co.

business.

Preferred

Co.

' 'Is-,

Urges Republicans to deal with fundamentals
of inflation by favoring government economies and higher Federal
taxes.
Sees need of restoring confidence in American industry and

Cleveland
"

WHEELOCK & CUMMINS

Dwight Mfg.

would restrain rents.

Teletype BA 893

BOSTON

policies for initiating and intensifying inflationary pressures.
Says
OPA was more interested in making America over than in
price
control, and attacks its propaganda as instilling fear in minds of
people. Favors relinquishment of many wartime controls, but

charge of the trading department

ST., BALTIMORE 2

wff. a

was

Co.

Former Governor of Kansas

Onetime Presidential candidate of

Street,

Angeles Stock

the

By ALF M. LAND ON*

become as¬

Spring

South

members of the Los

Members New York & Baltimore Stock

Exchanges and other leading exchanges

639

Revolutionary

Chronicle)

to The Financial

sociated with Gross, Van Court &

Co.,

AUBURN, N. Y.

Our New and

ANGELES, CALIF.—Al¬

bert W, McCready has

In Auburn

Noxzema Chemical

Bell

(Special

LOS

Common

« S. CALVERT

McCready Wttk
Gross, VanCont Co.

the securities business.

Emerson Drug

"iii i

--v-;

Ruger Associates, Inc.
Ruger

Monumental Life

■■

was

on page

right, in

358)

for

Nu-Enamel
Boston Sand & Gravel
U. S.

BROKERS and DEALERS

Empire District Electric
Eastern

Sugar Coip.

Western Light &

Eastern Utilities Assoc. Conv,

Memos

STOCKS

Telephone

By S. FR01ILICH, of L. D. Sherman &

Request
Established

M. J. Whittall Assoc. 2nd Pfd.

BUCKLEY BROTHERS

10 P. 0.

1420 Walnut

Corp

Square, Boston 9, Mass.

Telephone Liberty 8817

Teletype BS 373

New York

"Members Salt Lake Stock Exchange

Management Factor of Paramount Importance.

Stock Exchange Building
Salt Lake City, Utah

Lbs Angeles
Hagerstown, Md.

Pittsburgh, Pa.
N. Y. Telephone—WHitehall 3-7253
Private

Potential Growth Through Infusion of New Capital.

ings of all

obligations,

Phone 5-6172

Teletype SU" 67

Wire System between

needs

and

have

current

interest

New

England

Southern Advance Bag &

Paper

Textile Securities

Common

American

New England Lime Co., Com.

AND

Union Twist Drill

Dayton flaigney & Company
75 Federal Street, Boston 10
Private New York

Telephone

REctor 2-5035

Wringer Co. Com.

Properties

So. Colorado Power Com.

BOENNING & CO.

A. M. LAW & COMPANY
(Established 1892)

1606 Walnut St., Philadelphia 3
P ennypacker 8200

PH 30

Private Phone In N. Y^C.
'

COrtlandt

SPARTANBURG, S. C.
Teletype SPBG 17

L.D.S1

7*1202

New England Markets
Retail New England Coverage

Secondary Distributions

■

^•
•
;
Bank and Insurance Stocks

Industrials—Utilities
•

Inactive Securities

F.L. PUTNAM & CO.. INC.
Members Boston Stock

Exchange

Inquiries invited

Empire Steel Corp.

com,

Vinco Corp.

Sterling Motor Truck

Penna. Engineering Co. com.
So. Colorado Power Co. com.

Orders

Floor

Exchange from 10:45 to T 1*3(1
A.M.,
Pac. Std. Time: Sp-82 at

Company

Phone Rittenhouse 3717

Tele. PH 73

corporations is con¬
tained in the prospectus, yet the

respective

Dealers

Underwriters

this information.

analyst or econ¬
pro-forma income or
balance sheet figures are published
nor is any
opinion expressed re¬
omist.

<■

.Peyton Building, Spokane:
Branches at
.

layman is hardly quali¬

fied to interpret

He is not a trained

Members Standard Stock Exchange
of Spokane

Brokers

issuance

average

Standard securities
corporation

H. M. Byllesby &

Stock Exchange Bldg. Phila. Z

Quotes call TWX Sp-43

common

PHILADELPHIA OFFICE

Springfield

other hours.*

Warner Co.

Tel. LIBerty 2340
Providence

SECURITIES

77 Franklin Street, Boston
10, Mass.
Portland

NORTHWEST MINING

For Immediate Execution: of

•

The pur¬

of common shares capital actually bring increased
net earnings to the corporation
formed corporations at
and possibly an early dividend dis¬
alow per-share price/These offer¬
tribution to stockholders. Nor is
ings proved of wide public appeal
this answer readily obtainable, as
and were generally well oversub¬
the importance of adequate fi¬
scribed, regardless of merit. The
nancial resources is no greater
greatest opportunities
as
Well than
that of aggressive and capas
the
largest risk lies in
able* management.
this field. Extensive data on the
the

Botany Worsted Mills pfd; & A

capital.

of newly

SPOKANE, WASH.
Dealer

additional

divi¬

priority

Lime Co.

6—1966

the

poses of the financing are clearlystated in the prospectus.
They
might
include^the development of
dend status
patents or processes, the construc¬
combined
tion or acquisition of additional
with an option
manufacturing facilities, the ex¬
on
potential
pansion of plant and equipment,
earning power,
the acquisition of other companies,
have attracted
the segregation of an operating
considerable
Siegfried Frohlich
company from a holding company,
investment inthe liquidation of existing com¬
tcrGSti
;
mitments or an increase in work¬
The largest volume, however,
and, we believe, the most signifi¬ ing capital. The important ques¬
cant financing was reflected by tion, however, is will the new

the investor

Lamson Hubbard

efits accruing from the infusion of

units, offering

Boston Real Estate Trust

Megowan-Educator Food Co.

common

Southern

a
partnership or closely held
corporation prior to the new fi¬
nancing, no clear cut conclusion
is possible as to the probable ben¬

utility. Issues
of preferred

SPARTANBURG

Boston Edison

of these enterprises were operated

no com-

ment

Philadelphia, New York and Lot Angelet

has witnessed a large number of security offer¬
kinds and types.
Equity financing, to refund existing

The recent past

Street, Philadelphia 2

Co.

1898

W. H. CHILD, INC.

Members New York, Philadelphia and
Los Angeles Stock Exchanges

General Stock & Bond

Opportunities in Secuiities of
Newly Formed Corporations

UTAH MINING

Corporation

Kellogg, Idaho and Yakima, Wn.~

garding
available

future

operations.

information

covers

The
the

past, not the future. Because many

ment

the
is

present time, manage¬
with particularly

beset

vexing problems. While the un¬
wieldy inventory
positions, so
prevalent after World War I, are
generally moderate today; there
are other difficulties, such as mal¬

adjustments in the flow of raw
materials, labor stoppages in cer¬
tain "parts"

production and a par-

(Continued on page 346)

Volume 164'

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4S08

The Future of Economic Liberalism
By WENDELL BERGE*

By FRANK CIST

Prosecutor, asserting that our generation is
groping toward an economiccbill of.rights, and preservation of pri¬
vate enterprise against planned end controlled economy must be
decided by the United States, urges intensification of anti-monopoly
drive to preserve "dignity of the individual."
Cites recent trends
toward monopoly in both production and in techniques, which he
ascribes to war developments, and points out adverse effects on
small business. Says real significance will come when reconver¬
sion is completed and depression threatens.
Calls for vigorous

The surprise action of Canada
value of her dollar by 10%

enforcement of anti-trust laws.

I know that I

lieve

that

liberalism

with devotion
the

a w.

Liberalism

society

which is inspired above
other with the feeling and
consciousness of the dignity of

full

man."
,

continuing at¬
titude

In 1910 Woodrow Wilson pointed

out to the bar that Americans had

toward

fixed and

as Wilson predicted, that

ward

other forms of government, warns
us that every definition of democ¬

concerning
with

follows:

row

the

deserves

the

three

bill

the United

likely to accelerate

Wilson set the task of lawyers

means

technicalities

Cleve¬

counts and

which

have

our

•

production of synthetic rubber;
I'm going to' quote a few lines

warmly welcomed, expected to cut
British imports, increase
exports;
and put her exchange in fine
posi-i

from the "News" editorial:

little of it and needed

July

sell

without

fewer

and

imme¬

all

will

not

higher prices.

along

with

will

materials

get less Cana¬

she

needing

because

tourists

Our Far East

11, and Lewis L. Nettleton in The
New York "Times" of July
8), on

higher

cannot

and .tools

and

for

dian dollars for their dollars and

370)

on page

hence

(Continued

page

im¬

small

busi-

ness?"

going to
begin by de¬
fining t hat
am

from depression and gains

term

industry, played in the production
of alcohol for war j which helped to

it.:;'.-, *;:

defini¬

tion is simply
this: A small
business is one
which

has

about

million

tars.
0

v -

At the

important need for
Howard R. Bowen

out-

between big and
'

set, I think we can all agree that
interest of business—

may

that

the

well as small—is
of stable
high-level production. Only in a
big business as

(Continued

also

—

the

surveys

—

"Metals

metals

economy can

prosperous.

business

It has been

including sales, earnings and divi¬
dend records since 1936.

Earning Power, Harvard Uni¬

Chicago, Ill.» June u,

Business, May 1945; "1942
Corporate
Profits
by
Size of
Firm," Survey of Current Busi¬
ness, Jan,
_

Basic

back

Favorable

•

and

unfavorable

of the industry

as a

as¬

whole.

Uses of each metal In the group

...

discusses supply and demand and

problems of labor and competition.
A copy of "Metals—1946" will be mailed
on

request,

without obligation. Address

Department "F."

Merrill Lynch, Pierce, Fenner & Beans
Underwriters and Distributors of Investment Securities

Brokers in Securities and Commodities
70 PINE STREET

Whitman, Director,
Chemicals Division, War

production accomplishment of our
industry in a statement acknowl¬
edging, that ".
it is fair to re¬
gard the rubber manufactured to
date as being solely the product
of the beverage distilling indus¬

NEW YORK 5, N. Y.

Uptown Office-. 730 fifth avenue

seems

fair to estimate

that synthetic rubber is from 6 to
9 months ahead of where it could

have been if alcohol had not been
available

for

tion." And

butadiene

produc¬

August 18th, 1945,

he wrote: "From Pearl Harbor to
V-J Day registered distillers will
have

supplied to government about

750

million gallons

of 190 proof

alcohol.

Most of this alcohol has
been used for rubber. . . a magnifi¬
cent

accomplishment in the service
of the nation in its time of peril.*9

FREE —Send
OP

April 1944 Dr.

Production Board, recognized the

try
•

360)

rent

Mr. Bowen be¬
the National Tax Association,

Analyses of 43 leading companies

f W. L. Crum, Corporate Size
and

As far

example, during the
era.

•

gro¬

demonstrated,; however, versity Press, 1939, p. 55; J. L.
"Corporate Earnings
that small business suffers even McConnell,
by Size of Firm," Survey of Cur¬
more than big business from de*An address by

industry. Presents:

calamity, indeed,, if

those facilities had not been avail¬

Walter
—

the importance

non-ferrous

American

amply

fore

booklet

new

1946"

It is not

on page

have been

KEYSTONE OF PROGRESS
Our

cery store and the great industrial

achieve ar; economy

prosperous

differtiation

corner

industry was on hand with distilling facilities which could be,
and were, converted over night
from the production of beverage
spirits to alcohol for war. It would

able as, per

little businesses

for purposes of taxation.
self-evident

It was fortunate
indeed, that the distilled spirits

Prohibition

pros¬

the nrimary

the Non-Ferrous Metals

pects

Nevertheless, there

^al¬

BOOKLET ON

rubber pro¬

possible,

gram

business.

capital of less
than

maintenance

make the synthetic

AN UP-TO-THE-MINUTE

way in which
I expect to
use

the

We cannot help but he reminded

perity, and in the development of
tax system which is conducive
to prosperity.
The gain to be
realized by small business from a
tax system which promotes highlevel production far surpasses any
advantage to be derived from spe¬
cial tax adjustments designed spe¬
cifically in the interests of small

the

rubber corner,

of the part our company, and our

experience that when the phrase "small busi¬
invariably asks: "What do you mean by
'
■■■<&pression, and gains more from
prosperity.t Small business there¬
fore has an overwhelming inter¬
est

war-time

war thru
breakdown of transportation in
this country."
?

someone

energy

to be taxed as partnerships. Also favors a longer carry-forward
period for losses and accelerated depreciation.
been my

grace

synthetic rphber plan into actu¬
ality. If we hadn't gotten around
the

expansion; (3) income taxation by increasing
risks, discourages small business; (4) small business operates
under more intense competition; and (5) high taxes prevent small
business from enjoying corporate organization. Recommends (1)
graduated tax rate for corporate incomes; (2) elimination of "notch
provision" which taxes income bracket between $25,000 and
$50,000 at 53%; and (3) granting small corporations option

has

corner

teeth, the

our

could easily have lost the

reinvestment for

is spoken,

if they were sickly babies. We

of William M. Jeffers, rubber czar
who bulled the Bernard M. Baruch

377)

Drottt prosperity; i(2) they are largely dependent upon earnings

summer of
S. synthetic rubber

God, and the remorseless

modern¬

Mr. Bowen bases claims of small business for preferential taxation

ness"

of natural

sources

by the Japs. In the

the skin of

raw

By HOWARD R. BO WEN*

had

had been cut off from

got around that perilous

get

Economist, Irving Trust Company, New York

(1) small business suffers

lot of it.

ing most Of the output, and civil¬
ians were nursing their tires along

The Taxation of Small Business

that

was just going into its
stride, The armed forces were tak?

ization and repair of war damage

likely to keep their

was

program

(Continued

land, O., July 6, 1946.

1943 the U.

prices,

deter -British

less—food

produce

can

she

rubber

was

popular subject in those

days (war-time)

Financial Chronicle"

rubber

(Paul Einzig in "The Commercial

higher prices here. We,

power and

such

why

reason

and

can

"The

tion. Recent reports from London

help British exports, because

have

when reference is made to the

eats

price rise in Canada—or in the
United States—would normally be

not

will

she

and

most

interesting edi¬
torial in the New York Daily News|
captioned let's talk about rub-'
ber. Schenley, and the entire dis¬
tilled'spirits industry; perks up its

.•

however, insisting that it would

exports

_____
■

to!
to

imports from her
on

■■■■■

We read

Effect oii Britain

„

ports,

Our

relative

the subject of the loan to England,
have deprecated such a price
rise,

goods

By MARK MERIT

V Looked at frdm the British Isles

diate employment and more pur¬

chasing

here,

both ac¬

imports

prices

exports from us

to her and less

having

every
deliberate struggle
law, we ought to be the guides,
not too critical and-unwilling, not
too^ tenancious of the familiar

Cist

inflation¬
ary price rise.
By giving us less
dollars
for our money
Canada
raises the price to us of Canadian
goods. By getting Canadians more
of our dollars for their money she
cheapens our goods to them. Al]

and hence less

"In

address by Mr. Berge be¬
the Annual Meeting of the

Frank

Seen from here the action seems

this

"
■

spectacular, but in sum
they are not negligible. And

*.7. '

;

and that of Canada herself.

constitutional

violent ways, none of

are

those abroad, are necessary
world economic health. '

DISTILLERS CORP.

Remember?

are

higher

points in suc¬
cession, that

advertisement which

appear an

SCHENLEY

■

view¬

CORPORATION

of them

total

DISTILLERS

will

these ways inflationary pres¬
will be added to here. None

them

predecessor
'

hope
be of interest to our fellow
Americans. This is number 134 of a series.

sures

and

in these words:

*An

all

study. Such
study can con¬
veniently—in
spite of some

and

for

Guild,

and

import of

In this liberal movement Wood-

"We must define democracy as
that form of government and of

Lawyers

SCHENLEY

the

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

on which they get
Canadian money will
get
income and. more
buying
power here for U. S. goods.
In

income

litical power.

is insufficient, but proceeds
give us one of the best working

National

ing property

rights

itself

economic

rights which has long restrained
the irresponsible exercise of po¬

racy

fore

with

company.,

money at home, Our citizens own¬

States, that of
Great Britain,

than
with
political
rights and privileges. Our genera¬
tion is groping toward an eco¬
nomic bill of rights that will pro¬
tect our people from irresponsible
exercise of economic power, just
as
past generations worked to¬

of
democracy, not as a mere form of
government, but as an underlying
philosophy with deep spiritual
meaning. Thomas Mann, who has
had an ample experience with

economic society.

our

privileges

Wendell Berge

support

definitions

liberals is the

itself with

concern

we-

we see,

unalterable
purpose

movement of the

look understanding^ at the
liberal movement of the present

principles. But
one

would

the evils in

tory

be made from

code

associated

his¬

overlapping—

rather

world

that the liberal

problems - of
government,
fixed

seems

dent; and' Dorothy C. Aylward,
Secretary arid Treasurer. All were

July 5, in upping the exchange

to parity with the U. S. dollar

reconstructed political society and
future

than

time

every

fine and limit
because it is

critical
in

difficult to de¬

conviction is not

economic

political and
^

incompatible

action

business

Julius M. Underwood, Vice-Presi¬

statesmanlike

speaking tonight to men and women who be¬
in

securities

Chattanooga Securities Company,
James
Building.
Officers
are
James i P; McMahon, President;

tionary effect on Canadian prices* Holds, action has shown courage and leadership in Canada, since it was taken with great
political
risk to present Canadian Administration.

the

tinue

Economist, in stressing full import of Canada restoring parity between U. S. and Canadian
dollars, points out effects as (1) accel¬
eration of U. S. inflationary
pressure through lower Canadian im¬
ports and increased American exports ^ (2) increase of British exports to Canada; and (3) reduced Canadian .exports with defla¬

Anti-Trust Federal

if.-

Chattanooga Sec, Corp. '■■■■:.
CHATTANOOGA, TENN.—
Chattanooga Securities Corpora¬
tion haa^en organized to con¬

Canada Restores Dollar Parity

Assistant^Attorney General of the United States
•

341

Dept.
N.

postcard to MARK MERIT

SCHENLEY

18A>

ZbQ>

DISTILLERS

Fifth

Avenue,

Y., and you will receive

containing
various

reprints

subjects.

CORP.,

If.

96-pace boot

of .earlier articles

Art** Craft Briar Pipe Corpora¬ York 5, N. Y. Also available are
tion—Memorandum—B. G. Cantor circulars on Central Paper and
^^
& Co., 61 Broadway, New York 6, Textile, Ind.

Dealer-Broker Investment

Punta Alegre

Co.;

Worsted; Oil Exploration;

Barcalo; Haloid.

quest to investment dealers—Blair

—Brochure of articles

F.; Claybaugh & Co., 52
Street, New York 5,* N; Y;

oeen

Marchant

Canadian Western Lumber Co.

—Circular—Maher & Hulsebosch,

Company

Street, New York 5,

Kaiser &

William

120 South La
,

Chicago Corporation

—

newj

change, with special reference to
the Oil and Gas Division—Hicks &

South La Salle Street,

ill.

Columbia Gas & Electric Corpo¬

;

Avenue, New

York

;

ration

—

Hentz

"analysis

Detailed

the

New York

Co., 60 Beaver, Street;
4, N. Y.' J

Also available is the

circulars

are

Realization

Midland

Continent

Mid

on;

Airlines, Ampco Metal, Inc., and

available

Also

information

Chicago 3,

v.,:.

and

Pickering Lumber Corp.

Chicago

South Shore & South Bend.

Title

Guarantee

Trust

Co^-y

Supplemental report covering lat¬

Fortnightly

general, which
Midland Utilities Company and est earnings and condition—New
analytical material Investment Letter with data on Midland Realization Company—! York Hanseatic Corporation, 120
several
si
leading companies ini
uations, arid- a detailed Analysis—Ira Haupt & Co., Ill Broadway, New York 5, N. Y.
ircul'ar on Mullins Manufacturing
the field—Merrill Lynch, Pierce;
Broadway, New York 6, N. Y.
Fenner & Bearie. 70 Pine Street} Corp.
*
'
Union Gas Company of Canada,
also

Tele. CG 271

Randolph 6960

■'

1946—Brochure .on

Fifth

N. Y.

—

Shellef Manufacturing Corp. —
report—Mercier, McDowell
Maryland- Casualty Company- & Dolphyn, Buhl Building, De¬
Outlook and analysis—Sills, Min- troit 26, Mich.
ton & Co., Inc., 209 South La Salle
Stromberg-Carlson Co.—Statis¬
Street, Chicago 4, 111.
tical data—White & Co., Missis¬
Midland
Utilities — Circular — sippi Valley Trust Building, St.
Louis 1, Mo.
Also available is
Doyle, O'Connor & Co., Inc., 135

analysis of the company, which is
^ow listed on the N. Y. Stock Ex¬

metal industry in

Salle Street

CHICAGO 3

•
Td.

Metals

Established 1922

report

tecent

C.L Schmidt & Co.

Detailed

350

Machine

Calculating

—

they have

running in the Chronicle—
write to. Mark Merit, in care-oi
Schenley
Distillers Corporation,

Wall

Co., Russ Building, San
Francisco 4, Calif. 3?- f
*

Situations—Special Price, 231 Southi La Salle Street,Chicago 4, 111.
| c
!

New York 5, N. Y.

Wall Street,

Chicago,
Chic¬

are

md Taylor Wharton Iron & Steel;

reports for dealers on several situ¬
ations attractive for retail distri¬
bution—Amos Treat &
Co., 40

If:,

Salle Street,

W.' L. Douglas Shoe Co.;

Jersey

■

Low Priced

Company

134 South La

—

First

—

and review contain¬ Corp.; Haytian Corporation of
America;. Latrobe Electric Steel
ing brief analyses of Philip Carey
Co.; Ray~-0-Vac Company: Fort
Manufacturing Co.; Sargent & Co.;
Pitt Bridge Works and
Welch
The Upson Company; Lawrence
Grape Juice Co.--Strauss Bros., 32
Portland Cement Co.; The Parker
Appliance Co.; Pettibone Mulliken Broadway, New York 4, N. Y.
Corp.;
Armstrong
Rubber Co.;
Ideas for Dealers—With special
Ohio Leather Co.; American Furanalyses of Honolulu Oil Corpora-,
tion, Canadian Western Lumber
Co., Marchant Calculating Machine
Trading Market
Co., and American States Utilities
Corp.—Kaiser & Co., Russ Build¬
ing, San Francisco 4, Calif.

& Gas Common

Securities

Co., Inc., 55

memorandum

available

Also

of comment

Central Electric

Detailed

Broadway, Liberty Street, New York 5, N. Y.

120

Co.,

New York 5; N.
m

niture

**.$!& mi

■

** St. Louis Public Service "A"

ago 3, 111.
Also available1 is a memoran¬
Magor Car Corporation — De¬
memoranda
Gen¬ tailed • circular on growth possi¬ dum on Standard Milling Co.
of
railroad
equipment
eral Tin; Hartford Empire; LanQva bilities
Sugar Corp.; Mohawk Rubber; New equity—Magor Circular CC on re¬
Schenley Distillers Corporation

that the firms mentioned will be pleased
interested parties the following literature:

News-r-Brochure

Corporation—Circular Herrick, Waddell

Aspinook
—Ward

:3c Co., 10 Post-Office Square^

Boston 9, Mass

Lipe Rof.Iway Corp.—Circular—

It is understood

Geared to the

ner

N. Y.tff

Recommendations and Literature
to send

Thursday,. July 18, 1948

FINANCIAL CHRONICLE

THE COMMERCIAL &

342

contains

■

several

New York

5, N. Y.

Miller
Manufacturing
Co.— Ltd.—Analytical
memorandum—
Company—Analy¬ Study of company and wholly Hirsch & Co., 25 Broad Street,
New
York
subsidiaries—for
dealers
sis for dealers only on 66-year old owned
City.
Also available is a circular oh
company
with interesting pros¬ only:—Comstock & Co., 231 South
La
Salle
Chicago,
Rock
Island & Pacific.
Street, Chicago 4, 111.
pects—Moreland & Co., Penobscot
C. H. Dutton

CARTER H.CORBREY&CO;

Meeds, 120 Broadway, New

Coast

„

MARKET

DISTRIBUTION

York 5.

Inc.. 70 Pine Street, New

LOS ANGELES 14

N. Y.

;

650 S. Spring St.

135 La Salle St

Michigan 4181

CG99

State 6502

National

Manufacturing Co. —j
r
Descriptive
analysis—du, Pont,|
Preferred Stock Guide—Current Homsey
Co.,
31
Milk
Street,
issue giving quotations on unlisted Boston 9, Mass.
public utility preferred and com¬
Electric Boat Company—Detail¬
mon slocks—G. A. Saxton & Co.,
Dwight

5, N. Y.

UNDERWRITERS

CHICAGO 3

Building, Detroit 26, Mich.

&
York

Bissell:

banks—Laird,

City

Wholesale Distributors

SECONDARY

Banks—Com¬

City

and analysis for second
quarter of 1946 on 19 New York
parison

of Securities Dealers

Middle West—Pacific

York

New

Member, National Astqciatlan

Securities—Comment

Rail

LA 255

ort

Chicago; and
Duluih,
South Shore & Atlantic in the cur¬
rent issue of "Railroad and Other

*W«lls-Gardner & Co., Com.

Snap-On Tools Corp., Com.

Quotations"—B. W. Pizzini & Co.,
Inc., 25 Broad Street; New York 4,

Cribben & Sexton inc., Com.

N. Y.

cago

speculative

indicating

possibilities
Board

yml RDavls &G0.
16 So. La Salle St., Chicago

Co.,
Chi¬

KneelSnd
&
Building,

—

Trade

4, 111.

• ?■ ,i?'-

American

Indianapolis, Ind.

Delaware

Corporation^—-Memo¬
interesting out*
J. Young & Co., Inc.;

Grinnell
look—^F.

52 Wall Street, New

York 4,

York 5,N.Yi

Corp

Statistical

study

of
—

32 Broadway, New

N. Y.

Instrument

Argo Oil Corporation

—

Survey

of crude oil

utility income, together with ex¬

speculative
possibilities
developments—Fred W.
208 South La Salle
Street, Chicago 4, III.
cellent
from

CLEVELAND, O.—The follow¬

stock

ing

new

officers have been elect¬

by the Board of Governors of
the Bond Club of Cleveland:

President:

oil

Fairman & Co.,

Walter

Carleton,

vice-president of Fahey, Clark &
Co.

Bedford

New

Inc.

Lime Company—

'New England

Descriptive
circular — D a y t o i
Haigney & Co., 75 Federal Street
Boston 10, Mass.

Salle

Street,

3,111.

Co.

f-j

Northwest

Leather—Analysis

—

120 Raymond & Co., 148 State Street
Chicago Boston 9, Mass. Also available are
II analyses on Sterling Motors, Buda.
Pollak.

Cleveland, Ohio

FINANCIAL

offering combination of improving

-Mr.

•
^

Carleton

succeeds

Paul J.

Eakin, partner of Hornblower &
Weeks,

president of the.Club.

producer emphasizing
grow h possibilities and attraction
of petroleum industry as an infla¬
tion hedge—Seligman, Lubetkin &
Co., Inc., 41 Broad Street, New
York 4, N. Y.
1 J &'
1

Inc. -*■ Analysis of the
situation and prospects for appre¬
ciation—J. F. Reilly & Co., Inc.,

Exchange Place, New. York

N. Y.
-

Service—Analysis

Offered to Public
Loeb, Rhoades & Co: on
12 offered 38,535 shares of
4% cumulative convertible pre¬
ferred stock at $30 per share. This
represents shares not taken by
stockholders who received rights
Carl M.

July

Higgins,

Rome Cable Stock

Co.,

Analysis—Caswell
South

Rockford,IH.

•

memorandum

—Late

Elects Gariefon Pres.

Electric Corp

•

Insulator

—

Peter Barken,

Teletype CG 405

■

randum indicating

Hammond

Exchanges

Chicago Board of Trade

Tel. Franklin 8622

mmmmmmmmmmnn

Vice-President: Jay L.- Quigley,
Rayon—Circular Quigley & Co.
Treasurer: .Byron R. Mitchell,
on attractive situation—F. Jti. KoiWalnut St., Philadelphia 2,-Pa. ,
resident manager for C. F. Childs
ler
& Co., Inc., Ill Broadway
Also available are memoranda
& Co.
New York 6, N. Y.
on Eastern Corporation and West¬
Also available is a circular or
Secretary: Orin E. Koeser, resi¬
ern Light & Telephone. - .,
j
Delaware Rayon.
;
dent manager for Blyth & Co.,

Established! 1916
Members Principal Stock

if.,

York

Empire District Electric—Mem¬
orandum—Buckley Brothers,-1420-

American Glass Co.—Analytical

brochure

Request.

Bleichroederj

Inc., 30 Broad Street, New
4, N. Y.
'
' "

Gas

National

Longines-Wittnaner Watch Co.
Common

and

—Arnhold

•'

Boston & Maine; Kansas City, St.

Louis

*Prospectus Available on

discussion: of interesting, issue

By-Products Inc.—An-

lysis—-Brailsford & Co., 208 South
La Salle Street, Chicago 4, 111.

Cola—Circular on
possibilities — Hoit.
Rose & Troster, 74 Trinity Place
New York '6, N. Y",
Panama Coca

interesting

Light
—Josephtfral & Co., 120 Broadway, Company—Analysis—Seasongood
New York 5, N. Y.
& : Haas,; 63
Wall Street, New
Iowa

Public

Power

Pennsylvania

to buy 63,276
one share
of

shares at the rate of
preferred for each

of common held.
preferred is conver¬
tible into seven-eighths of a share
culars on Shatterproof Glass; Tem¬
V
^"t ' F.
-Kr
?' 7'
•
York 5, N. Y.
of common until July 1, 1951, and
In All Its Branch es ple Coal; Tennessee Products; and
Kendall
Co.—Circular—Adams
into
three-quarters of - a share
& > Peck,
Wellman Engineering Co.
Proceeds from the fi¬
63 Wall Street, New
Fred B. Prophet Company—De^ thereafter.
Plans Prepared-~Cpnference Invited; •:
tailed memorandum—De
Young nancing will be used to erect *a
new
factory and increase working
Larson & Tornga, Grand Rapids
Albert Frank * Guenther Law
National
Bank Building, Grand capital. With this financing, the
Incorporated
*
;
company's capital setup will con¬
Rapids 2} Mich. .•
131 Cedar Street New York 6, N. Y.
New Analysis /
sist of 189,830 shares of $5 par
Teleh^o^COrtlandtY'JCfiO ?
value common stock and $L125,Ralston Steel Cat1 Co.*—Circular
/
I
Boston Chicago Philadelphia San Francisco
CHICAGO
000 of 2y4% serial notes, besides
on interesting situation with fathe new preferred stock.
(NOW LISTED ON THE NEW YORK 6TOCK EXCHANGE)
•
%
vorable * long-term outlook^-Lerp

ADVERTISING

Also available

are

detailed cir¬

three

Each share of

•V

THE

CORPORATION

■

Fred. W. Fairman
Co. L
JMMBBSINCE1908
BBBBB91

with special reference to the
f'

OIL-GAS DIVISION

Members

Write

•

Chicago Stock

Exchange

phone for

-—.y

your copy

—We Maintain

Active Markets In—

..DEEP ROCK OIL

CORP;Common

Chicago Board of Trade

HICKS

National Gas & Electric

Corporation Common Stock
Write For
A discussion of

Members New York
and other

N-J,

this

company.

South

JJtock Exchange

H. M.

•

Bell

System CG fiS%

New York

Office, 1 Wall Street

Byllesby and Company
Incorporated

<•

State 1700—Randolph 5686

135 So. La
-

Telephone Randolph 4068
Direct Private Wire to New York

Preference

principal exchanges

La Salle Street, Chicago 4

208 SOUTH LA SALLE ST.

BEND RR. Commoii 7

REEVES-ELY LABORATORIES Conv^

231

CIHCAGO 4, ILLINOIS

ClffCAGO SO. SHORE & SO.

& PRICE

Telephone State

Salle Street, Chicago 3

8711

^Bowling Green 11-1432 ' •' ^

New YorkJ

1 Philadelphia /

- Teletype CG 273
Pittsburgh
MinneapolU r

.Volume 164 -Number 4508

TJHE^OMMERCIAL & FINANCIAL CHRONICLE.

343

(Special

Chicago Personnels
(Special

to. The

i'-v-

Chronicle)

Financial

CHICAGO, ILL. — Edward R.
has rejoined" the staff of

(Special

Brill

Barcu*-, Kindred & Co., 231 South

Salle

Street, after serving in
'

(Special to The Financial

CHICAGO, ILL.

The

Financial

CHICAGO, ILL.

Geagan

the Lb S. Navy."

has

Alfredo II.

—

Co., 120 South La
Salle Street, after serving in the
U. S. Army. "
■. : ,:, X

Chronicle)

(Special

The

Financial

Chronicle)

Sidney W.

CHICAGO, ILL/— Harold Paul

Ballis has become connected with

Smith has become-associated with
Hicks & Price, 231 South La Salle

—

Bear,-Stearns & Co., 135 South La
Salle Street,
U. S. Army.

after serving in the

Street.

was

Continental

Illinois

Bank & Trust

(Special to The

has

been

(Special

John M.

—

added

the

;

National

Company.-

The

Roberts

120 South La Salle Street. He has

with Kidder,

recently been serving in the U. S.

Army.

Financial

ILlil

CHICAGO,

staff of A. G. Becker & Co.* Inc.,

1 *'

has

Chronicle)

■

(Special to

The

Chronicle)

Financial

connected

Peabody & Co., 135
South La Salle Street. He has re¬

Van

Ness

with

James

CHICAGO, ILL. — James W.
Greene, Dale C. Long, Gerald L.

(Special

Boulevard. He has been serving in
the U. S. Army.

The

W. Stanfield are

Year Book.
operation

The

Financial

; CHICAGO,
Jensen

ILL.

Chronicle)

"Commercial
ward

tion

has rejoined

CHICAGO, ILL.
Ashdown
with

135

after

serving in the U. S. Navy.

South

Freres

The

Chronicle)

Financial

CHICAGO, ILL.

Burt White¬
head Marx, Jr., recently serving
—

was

(Special

23
re¬

Chronicle)

South

The Financial

I CHICAGO,

ILL.

—

Chronicle)

George W. /

j \

HAROLD B. SMITH, Chairman

TRADING MARKETS

National

■

•

Advertising Committee,
Collin, Norton & Co., N. Y., N. Y.
W. TRYDER,
Vice-Chairman.
National Advertising Committee,

R. E. FUNSTEN CO.
,,

Common

W. H. Newbold's Son &

•

Co., Phila.
P. S.—Advertising in hand for
yearbook exceeds $22,000.

DAZEYC0RP.
Common & Pfd.

NSTA NOMINATING COMMITTEE

Announcement is made by Thomas
Graham, President, of appoint¬
ment of
Nominating Commi.tee for the National Security Traders
Association to make nominations for officers to hold
office
calendar year

KITCHEN & CO.

during the

1947:
?

135. South- La Salle Street

Chicago 3, III.

Salle

i Tel. ST Ate 4950

previously in the

Tele. CG. 28

IT. S. Navy.
(Special

Building.

The

Financial

CHICAGO, ILL.
facobson

(Special

The

'CHICAGO,
and

Chronicle)

Financial

ILL.

Potter

—

Stuart B.

Lasher

Chronicle)

Co.s 208 South La Salle Street

The

Chronicle)

Financial

Colby A.

—

Cogswell and Foster S. Randle
with The

Boston

First

(Special

Chronicle)

Financial

Salle

;

|§|;.

Street,
■

NATIONAL TERMINALS
:

The

Financial

CORPORATION

Chronicle)
:

CHICAGO, ILL.—Chauncey K.
Hutchins is with Mitchell, Hutch-'
&

Co.,

231

South

CHICAGO, ILL.—Roy E. Camp¬
the staff of First

Preferred

and Common Stocks

Salle

Street, after serving in the U. S.
Army.

Wm.

Perry Brown

Willers

Joseph Gannon

Circular
(Special

Corp., 231

ing in the U. S. Army.
The

fTV

Men-

are

South La Salle Street, after serv¬

South

Arthur W.

Norman

after serving in the U. S. Army.

ins
(Special

with

—

are

after serving in the armed forces

CHICAGO, ILL.

135

row,

connected with Farwell, Chapman

(Special

Financial; Chronicle,0 he* should
immediately forsnapshot of -himself with his name and firm affilia¬

with Mason, Mo¬

135

Street.

i :

of Trade

now

Co.,

Street.

in the U. S. Naval Reserve, is nov
with Clement, Curtis & Co., Board

Carroll

Co.,

He has

CHICAGO, ILL.—Neven J. Rus:ell, Jr., is

(Special

Financial

with Slay ton &; J;
South.La Sailer;r.

interest to both the Editor and Publisher of the "Commercial
and
Financial Chronicle" and to
your National Advertising Commit,ee?

associated
&

each member give us his co¬

135

pho.ograph is not already in the hands of the

Edward II.

—

become

Lazard

(Special

Salle

imperative that

Co.,Inc.,

the reverse side- to Mr. Herbert D.
Seibert, 25 Park Place, Gartman, Jr. has become affil¬
New York 7, New
iated with Swift, Henke &
.York, Editor of the "Chronicle.*"
Co.,
We, are most anxious to, have our Picture Roster of
the entire 135 South La Salle Street. He was/'
membership complete when published and ihe deadline is
August 1 previously iii the U. S. Coast ':ifor pictures. Will yon not take
this| mattef" seriously and prove your Guard.'

•

has

Serve.

Blair & Co.,
Street,

Inc.,

and

picture

now

if his

cently been in the U. S. Naval Re-

Ilenry

—

It is

and

Chronicle)

South La Salle Street.

(Special

Financial

The

Financial

Request

;

Chronicle)

CHICAGO, ILL. — William A
Grigsby has rejoined the staff of
John Nuveen & Co., 135 South La
Salle Street, after serving in the
armed forces.

☆

bell has joined

Securities

Company

South

134

Salle

(Special

Chicago

Street, after

serving in the U. S. Army.
to

The

Chronicle)

Financial

O'Leary,

CHICAGO, ILL.—Alvin H. Ulhas become associated with

134

Letts

Salle

Street.

the

ADAMS & C®.

Chronicle)

Marjorie D,

231

past

Peter

with J. S. Bache & Co.

V.
are

Eece,

and

now

con¬

to The

South

Salle Street.

TELETYPE CG

(Special

CHICAGO, ILL.—James E. MaStuart

Ilalsey,

Co.,

Inc.,

123

S.outh La Salle Street, after serv¬
ing in the U. S. Army.

Oliver

William

(Special
-

to The

Chronicle)

Financial

CHICAGO, ILL.—Carl W. Jack-

rejoining
after

Company,

Harris, Hall
serving

Goshia

Howard

Morton

&
the

ILL.

Gerald

—

Hollins, Jr. is with Harris, Upham
& Co.,

135 South La Salle Street.

was

Financial

Chronicle)

with

Otis

after

serving in the U. S. Army.

(Special

•

Co.,

Chester E. de

Willers, C. E. de Willers & Co., New York City.
Joseph Gannon, May & Gannon, Inc., Boston.
Oliver Goshia, Goshia & Co., Toledo.
Howard C. Morton, McMaster Hutchinson & Co., Chicago.
Nominations will be made by Aug. 15 and voted on at the annual

The

Field Building,

Howard

Financial

Chronicle)

ers

Tracy,

120 South La Salic-

previously in

the U.

Navy.

Street, after serving in the U. S.
Army.

is now with E. II. Rollins & Sons,
Inc., 135 South La Salle Street. /

Avenue,

(Special to The Financial Chronicle)

CHICAGO, ILL. -^William S.
is

with

Ross, Browne

(Special

after

serving

are now

the

FERRY CAP & SET SCREW

with

The

Financial

Elmer J.

Shields & Co,,- 135

(Special to: The Financial

Trailmobile Company

associated

now

*Detailed

with

Stone

Analysis Available
Upon Request
/a//

CHICAGO 4

—

331

So. La Salle St;

Dearborn 1501

Teletype CG 955

Webster Securities Corp., 33 South
Clark Street.

Macfadden Publications
;■

Koehring Co.

Weyenberg Shoe Mfg. Co.

Nekoosa-Edwards Paper Co.

National Tool Co.

Red

Northern Paper Mills Co.

Top Brewery Co.

Cons. Water Pwr. and
Paper Co..

Froedtert Grain & Malt. Co.

Compo Shoe Mach. Co.

Hamilton Mfg. Co.

Lake

James

Superior District Power Cow

■

Gisholt Machine
All Wisconsin Issues

Manufacturing Co.

OLLEY, DAYTON & mm

:'r; :1v

Member—Chicago Stock Exchange

INCORPORATED

TdetypeyCG 1200

Superior Tool & Die Co.

COMSTOCK & CO.

ChroniclS)

George J.
Recht, formerly in the U. S. Navy,
is;

Light Co.

Chronicle)

Roy Iverson, Jr., and Charles J.
McCoy have joined the staff of
Sills, Minton & Co., Inc., 209 South
La Salle Street.

CHICAGO, ILL.

Company

Puget Sound Power

CHICAGO, ILL., — Roger S.
Cummings, Taylor D. Ferguson,

THE SECURITIES

105' So.

CHICAGO 3; ILLINOIS
Dearborn 6161

—

CONTINUOUS INTEREST

135 SOUTH! LA SAIXE STREET

Manufacturing Co.

Nutrine Candy

*Circular available upon request.

Chronicle)

South La Salle Street.

"MIDLAND REALIZATION

DOYLE, O'CONNOR & CO

Financial

ILL.

(Special

Michigan

^earson, formerly in the U. S.

MIDLAND UTILITIES

to The

j CHICAGO,

CHICAGOSOUTH SHORE & SOUTH BEND

Tale phone:

North

armed forces.

CENTRAL ELECTRIC & GAS
*

919

Army, and Clarence A. Reihmer

Everett

Kropp Forge Co.
'"Miller

Fleming,

Industries, Inc.

'"Hydraulic Press Mfg. Co.

convention in Seattle in- September.
Additional nominations may be
made by seven members of the National Committee of the NSTA.

CHICAGO; ILL,—Jules A* Ruptperv formerly imthe U. S. Armjb

Chronica

STATE O10»

Aeronca Aircraft Corp.

Perry Brown, Chairman, Newman, Brown & Co., New

(Special to The Financial Chronicle)

(Special to The Financial

CHICAGO,

The

CHICAGO, ILL. — Leonard P.
Eager, Jr. has become associated

J. S. Naval Reserve.
f

CHICAGO. ILL; — Thomsa M
Davy has joined the staff of Rog¬

ILLINOIS

PHONE

was

in the armed forces.

honey has become affiliated with

361

Mrs

previously with Carson
Pirie Scott & Co.; the others were

Chronicle)

Financial

LA SALLE STREET.

CHICAGO 4,

Orleans.
(Special

SOUTH

nected with Alfred O'Gara & Co.

rich

was

—

Richard U. Strasser

Goldman, Sachs & Co., 208 South
La

Financial

Letts, Edward W. Liphardt,. John
C.

(Special

to The

CHICAGO, ILL.

;

^ *s neecftess to repeat the enormous amount of work your Adver¬
tising Committee has accomplished in the
preparation of our Picture

•

the armed forces.

Purcell, G. Milton Ryan, and Earl U

Halsey, Stuart & Co.

Bennett & Co., 141 West Jackson

Chronicle)

—

NSTA ADVERTISING NOTES

CHICAGO, ILL.—Carroll Rad¬

ford

Financial

ILL.

WUlis/L.

become

cently been serving in the U. S.
Navy and prior thereto was with

with

Chronicle)

Financial'

; CHICAGO, ILL.
Rainsford

formerly

The

Street, after serving in

NSTA Notes

with

CHICAGO,

Ilenry D.
Freedman and Albert II. Klee are
with Straus &
Blosser, 135 South
La Salle

Chronicle)

affiliated

become

Hentz

Members Chicago Stock Exchange
225 EAST MASON ST.
MILWAUKEE (2>
•

PHONES—Daly 5302 Chicago:, State 0935

Teletype MI 488

La Salle St., Chicag

CG 262-

Centi

3, 111.
V f?80

Offices In Wisconsin
Eau Claire

Fond du Lac

Madison

Wausau

rosso

■■

■

THE

344

stock of Davidson Bros,, Inc.;

moil

large department store,

Michigan Brevities
A

County Airport
and Means Committee
bond proposal will be

It is said that the $5 millions, plus

submitted to voters in November.

sufficient to construct a service¬

$5 millions in Federal aid, would be
able field

near

Detroit.

ffi-- iv !-"f

'•>

of Kop-®
pitz-Melchers, Inc., local brewery, f
announced the firm will soon

Local stock exchange activity

offer scored another advance in June.
In the first six months sales were

128,697 shares of common at $1
share. Holders of record June 3,127,111, having a market value
27 will be entitled to buy three of $38,545,728, as against 2,606,529, valued at $26,862,246, in the
shares for each 26 held,
comparable
1945
period.
June
volume was 368,587.
per

Call Us On Any

the company
is offering
its holders 43,389
shares of common at $2 per
share.
Holders of $10 par 6%
has disclosed that

convertible

cumulative

•t'L. P. Hicks, President

Industrial

?&';*

V*'

■'

Holders of

held.

would be

137,515

that

said

fered to the public and the
ferred

Wm.C.Roney&Co.
Members New York Stock
812 BUHL

share
be

Exchange

1st

to holders of the

ance

quire 27 7/10 shares for
held.

call

used

preferred
not

2nd

BUILDING

converted into common stock.

DETROIT 26, MICH.

Phone

Teletype

6700

Cherry

DE 167

Stockholders

of Hydraulic

Ma¬

chinery, Inc., of Dearborn, have
voted to acquire 85% of the pri¬

vately-held stock of Duro Co., of

Charles A. Parcells & Co.
Established 1919

Dayton, Ohio, according to Harry
L. Wise, President. The transac¬
tion was arranged by Lytle & Co.,
investment bankers,

Members Detroit Stock

^^ y

-v

1 "V S \j,\

A,.

Fund and Bank
(Thirteenth of

Series)

G. W. J. BRUINS

Executive Director of the Fund

the

at Savannah

Fund

votes

executive director of

native

his

and

the

Dr.

Bruins

controls

the

South Africa,

Union

with

Netherlands

Corpora¬

registered

Michigan Markets
DETROIT 26,
•

ing

Building

639 Penobscot

statement with the SEC cover¬

MICH.

of the

Fund's

total.

Teletype

Randolph 5625

DE 206

$50

vannah

declared

payable July 18, to stockholders

Electromaster, Inc.
'Prospectus furnished

Manufacturing Corp.

Walter

&Dolphyn
Exchange

Buhl Bldg.. Detroit 26
Cadillac 5752
Tele. DE 507

has

approved

Detroit

The

Mercier, McDowell
Stock

29.

June

in Detroit.

Report furnished on request

Detroit

record

Konkle, President announced the
election of H. R, P. Lytle to the
Board of Directors. Lytle is head
of an investment banking firm

request

Sheller

Members

Stock

Exchange

Born in Zut-

de¬

Laws

G. W. J. Bruins

at
the
University of

legislature

to be the policy of Congress to
provide for the ultimate inclusion

citizenship
the

He is the author

a study, "The Judicial Basis for
Indemnity." Prior to 1913 Bruins
worked in the South Holland Fi¬

recommendations

Simplex Paper
Douglas and Lomason

Company

1924

Netherlands School of Commerce,

Then for six years he
international commis¬
sioner of the German Reichsbank,
under the Dawes Plan.
Mean¬
Rotterdam.

served,

Lieutenant in the USNR, spent

incorporating in the bill the citi¬
zenship

popular news-

European

Union,

central

and

organ¬

papers

European countries.

The C. H. Dutton Company
company

with

have

head¬

authorized

the

land in the Palaus to mine phoson page

395)

Britishers to the

many

vice presidents.

Partridge has been associ¬
ated with the firm since 1941 as

the Los Angeles office
continue in charge of
office.
Before joining the

will

and

Paul Einzig

that

firm he

practiced law in Los An¬
geles, specializing in estates man^

Analysis For Dealers Only On Request

agement.

STOCK

EXCHANGE

PENOBSCOT BUILDING

v "

1940

joined the firm
manager of its San

■—

Muskegon

widely

front

mintues

it.

merly 'associated

with

the

Cali¬

member

the

Stock Exchange.

San

Francisco

the

the sub-

And

discussed

exchange
,

views
'v

During the week that preceded
believed

the debate it was widely

the loan.

The pro¬

spects of its rejection were viewed
with mixed feelings.
Supporters

worried
possible effect on pub¬
opinion of the new austerity

measures

that

rejection

after

ple that they

are

British in the

the

only.

second

instance

National pride has indeed been
hurt to the utmost by the unend¬

ing torrents of abuse showered on
Britain by American opponents of
since

the

conclu¬

The Gov¬
has, carefully avoided an¬
swering the attacks, for fear of
antagonizing American
opinion.
There is a widespread feeling over
here that this display of weak¬
ness was a mistake, and that out¬
spoken replies
to the charges
would have improved rather than
worsened the prospects of ratifica¬
tion, since they would have earned
the respect of American opinionAs it is, the meek submission t6
one-sided blows was considered ;a|

that the House of Representatives

lic

have been

would

the

about the

for¬

months' delay would itself
be sufficient to remind many peo¬

prospects of a
majority in

of the government were

was

that

insult

seven

debate and the

to direct that office.

trains, restaurants and all sorts of
places where people can spare a
on

the

implied

Socialist

Francisco office and will continue

fornia; Packing Company on the
Pacific Coast and is a former

DETROIT 26
Lansing

was

would reject

Mr. Hendrickson

Moreland & Co.

favor of the loan,

few

the

headlines

trend

ject

Mr.

Representatives debate

first instance and Conservative

day aft¬
er
day, indi¬
cating the

Van Strum & Towne

son as

carry

pages

manager of

Exceptional Prospects

MacArthur's

General

quarters

promin ent
the

Teletype GR 184

Phone 84336

ratifica¬

its

eastern

Partridge and Alfred D. Hendrick-

fall.

Agreement was followed in Britain with much keener interest
than
any
of®
—
the previous ways, as it might induce the counphases of the try to rally round the government
prolonged ef¬ in face of emergency. However,

served as ad¬
National

also

Van Strum & Towne, Inc. an¬
the election of Charles W.

Bay City

Territories, of which Congress¬
Hugh Peterson of Georgia is
Chairman, and it is anticipated
that hearings will be held in the
man

LONDON, ENG.—The House of
Loan

nounce

1051

has been

By PAUL EINZIG

MICH. TRUST BLDG.

DETROIT

bill

London Observer pictures resentment

Elect Vice-Presidents

MEMBER

Grant

(Continued

Members Detroit Stock Exchange

GRAND RAPIDS, MICH*

The

To Loan Ratification

fiscal law.

reconstruct

islands.

London's Reaction

president

preparatory commission at the
Hague to establish an interna¬
tional association of financial and

ization for the study of means

66-year-old

velopment and settlement of these
referred to the House Committee

Hawaii.

sentative

Congress

by Japanese to return to Anguar Is¬

Delegate Joseph R. Farrington of

while, in 1926, he became Royal
Commissioner of the Netherlands

Bruins

Stearns Mfg. Co.

t Common Stock

Phone 98261

with respect to the economic de¬

ceded to the United

prolonged and acrimoneous debate in Congress over British Loan.
Says unpopularity of loan iit Britain has been) enhanced by action
ing Co., common stock. Trading is
expected to start around Aug. 10. Netherlands Board of Economics. % of: Canada in raising its dollar to parity, resulting in 10% cost
increase of Canadian grain imports. Sees opposition to increased
The
exchange
also
commenced
Since 1934 Bruins has also been
American imports, but this is tempered by benefits of larger sup¬
and director of
the
dealings in the $1 per value com- president
Netherlands Clearing Institute. In
plies of needed American commodities.
200,000 shares of Lansing Stamp¬

Fred B. Prophet

GR 84

Territory

Department.
From 1913 to
he
was
professor at the

ance

1938

islands, atolls, and areas
of Guam, and

the

year on

the

Circular

the

directs the Commission to submit

Richard H. Wels

upon

was

administered

now

of such

islanders, and
conferring

give it representative government

gree

application to list Bank,

United States. The bill declares it

the staff of Secretary of
The Grant bill, and other legis¬
the Navy James V. Forrestal, and lation
recently introduced in the
10 months in Guam on the staff
House, have for the first time
of Vice-Admiral George D. Mur¬
focused
Congressional
attention
ray, Commander Marianas.
Now on the non-military phases of the
practising law in New York, Mr. islands in the Pacific which we
Wels has just drafted an organic
have wrested from Japan.
bill to make Guam a territory and

Co., of Albion, has
dividend of 3% cents,

and

LeideW in 1908.

Decker Mfg.

ap¬

President

as a

phen, Nether¬
lands, in 1883,

Islands

and

Editor's Note—Richard H. Wels,

the

Marianas

pointed by the

of the ad¬

ed his Doctor

purposes.

Governor

development of all islands, atolls,
areas formerly mandated to
Japan by the League of Nations

civilian

Congressman Grant's

provides for the estab¬

Commission, charged with respon¬
sibility for planning the economic

government
with

also

lishment

was

Bruins obtain¬

of underwriters. Pro¬
ceeds will be used for expansion

bill

es¬

Spain in 1898, after hav¬
ing been captured by the USS
Charleston, Guam has been main¬
tained solely as a naval station,

Dr.

Bruins

par

a group

and has been administered by the

States by

Sa¬

4y2% series A convertible pre¬
ferred stock for public offering
by

Telephone

250,000

Indiana, a member of the
Tuesday, July 16 introduced

Navy Dept.

streamlined

Since it

votes, or 5.13%

one

on
-

Guamanians.

4,250

delegation.
Motors

Continental

Grant

Committee,

elected by the
Elected

tion of Muskegon has

Affairs

7044j a
creating
Territory

Guam,
tablishing

Netherlands

Exchange

Naval

Officials oi

visors

Detroit.

Representative Robert A.
House

into the House

pre¬

and shares of 1st preferred

each 100

the

of¬

Proceeds will

mandate after First World War.

bill

bal¬

urges

par

H.R.

•

exchangeable

shares,
for share.

each

will be entitled to ac¬

common

.va'v:

UNLISTEDS

By RICHARD II. WELS

need of definite American policy to take advantage t
of the great economic and social potentialities of
newly-acquired.
Pacific islands. Cites the exploitation of the islands under
Japanese
Mr. Wels

pre¬

for

purchase
share

Our Sterile Policy Toward
The Conquered Pacific Islands

entitled to

ferred stock will be

Brownhoist Co; of

Bay City has registered with the
SEC 309,716 shares of $1 par
value common.
The statement

MICHIGAN

•

Company,

Finance

Pioneer

Boynton, President

Frank D.

$5,000,COO bond issue to enlarge the Wayne

has been approved unanimously by the Ways
of Wayne County Board of Supervisors. The

Thursday, July 18, 1946

COMMERCIAL & F^NA^tJIA^ CHRQNICLE

rej ection of the

loan would entail. Many of them
were inclined to think, however,

that ,9 rejection; would cut. both

sion

loan

ever

of the agreement.

ernment

most humiliating

experience which

likely to be remembered long
after the loan has been granted
is

the

proceeds spent.
Indeed,
some people
who are'
convinced that the effects of a re—

and

there

are

(Continued

on page

384)

.Volume 164

Number 4508

THE

COMMER&Afc &

FINANCIAL CHEOEICLE

Connecticut Brevities
For

dis.ance and toll calls.

Total telephone revenues of $3,131,869 for the
15.6% ahead of the month of May last year, while net
profit of $264,990 compared with $202,839 in May, 1945.
,
For the first five months of this
year, long distance and toll calls
totalled 24^910,119 which
repre-^
sents an increase of 25.5% over
The
Hartford - Connecticut
were

the corresponding period last
year.
Total revenue

through May 1946
of $14,917,791 was
up 13.2% over
$13,192,783 in the like period last
year.
VNet

profit

for

the 'first

-five

months of 1946 totalled

$1,384,760
$3.46 a share compared with
$1,035,053 or $2.59 a share for the

Trust

dated

July 30, 1946 and due August 5,
1947, at .75%.
#

Clock

$4,000,000, undivided profits
$852,000
and
reserves' of
$1,061,000.
>
'
*
\ {

New York

Curb

4V2%

listed

pre¬

the

Exchange.

the

quarter

end

National

1946,

Bank

the

second

Hartford

Trust

Com¬

had total deposits of $145,284,555 which compares with
$153,151,971 at the year end.
Loans and discounts at $20,-

pany

443,343
Dec.

were

$559,015

over

31, 1945.

Book

value

pares with

$24.80

$24.26 at the end of
:•,*

As of June 28, 1946, the Phoenix
State Bank
&
Trust
Company
showed loans and discounts of

$8,-

555,219

which

$8,054,268
There
and

templating

a $2,500,000 long-term
loan to finance this purchase and

other purposes in the
pany's expansion program.

for

was

due

litle

966,819

end

1945.

banks

but

securities

$48,-

$7,813,187 less than in

was

♦

New Haven &
Company for

Hartford

Railroad

the

five

months ended

May 31, 1946, as re¬
ported to the I. C. C., showed
freight
revenue
of
$29,823,767
against $38,438,474 for the cor¬
responding period last year.
In
these same periods, passenger rev¬
enue
was
$25,121,375 and $3Q,013,242 respectively. Freight rev¬
suffered

enue

decline

22.7%,

proximately

ap¬

December 1945.

Surplus in the six months

was

increased

while

pas¬

charges was $232,335 or .05 times
against $10,122,640 or 2.01 times
for

the

first

months

last

deficit of $4,691,196
net
income
of
for the corresponding

and

year;

five

with

$5,087,114
period in 1945.

The Sikorsky Division of United

purchased from

Stock

investment
headed %y Glore,
>.An

group

the

Associated
&

with

Glore,

Co, in the offering are:

Forgan
Coffin

factory property

Avenue $

in'

Company have been agreed up¬
on
subject to approval of the
stockholders. Under the plan of
holders

merger,

stock

the

West

Hartford

Trust

Company
will
rereceive eight $25 par shares of
Hartford
Connecticut Trust
Company for each share held.
$400,000
Hartford

increase
-

capital of
Connecticut Trust

Company, bringing the total to
$4,400,000.

of $105,000.

-j

The

proceeds

from

Vr>

the

rectors propose

sale

ately

the

bonds, together with
treasury cash, will be used to

$25 per share.
preferred holders

on
or
about Aug. 16,
$9,000,000 of first mort¬
3%% bonds due 1966 at

gage

10414 and interest, and the

off

promissory

$4,000,000

and

any

added
been

to
if

June 30, 1946, an increase

months'

Net

income

was

the

corresponding

period a year ago.
after income taxes

$558,832, equal

common

$1.48

over

share,

$1.86

per

against $443,311,

per common share in the

preceding year.
The net income
for the full fiscal
year ended Sept.
30, 1945 was equal to $1.50 per
share. For the nine months ended

30,

1946, income taxes to¬
$492,211, or $93,734 above

■■■'.4

same

period last
*

■

conditions

plan

purchase

public

offering

through
to

will

common

warrants.

Edward

stock

mon

& Co., of St.
Louis, the
preferred to be priced at par and
the common at $4
per
share.
was

stated

from

2,000,000

the

expected

that

outstanding $10
mon

holders

value

per

stock may on and after

25 surrender

140
Y.,

and

July

their certificates for

Guaranty Trust

Broadway,

New

receive

certificates
many

York

exchange
for

Exchange

are

Primary Markets in

stock.

*Statistical

Information

Request

becomes

will

$50

ST. LOUIS 1, MO.
Bell System

Teletype—SL 477

the

are

interested in

thereupon

per

stock, which

Exchange

Mississippi Valley Trust Bldf.

this

effective,

price

While & Company
Members St, Louis Stock

par

means

Convertible Pfd.

that

$5 value

common

& Common Stocks

stock.

total
The

common -

stock

the

Midwest

Piping & Supply Co.,
Ljouis, on which a 100%

St.

con¬

stockholders

cash divi¬

Metropolitan St. Louis
COMPANY
718

Saint

Locust

Louis

Street
1,

Mo.

Central 8250

St* L- 499

L. D. 208

were

record

June 25 (at St. Louis), was "ex"

to be used

outstanding

The stockholders of the
Crown

Hartford and

(Units)

convertible into two shares of the
new

capital stock of Midwest Waxed
Paper Co., Fort Madison, Iowa.

••

stock, series A, will then be

both

acquire all of the

PM.,,

*V"*

Bonus Products Co.

three

shares of the $5

common

reduced

ence

10,000

The net proceeds

Exchanges

Trailmobile Go.
Common & New

the

com¬

recently declared, payable July

Associate Members New York Curb

*Ampco Metal, Inc.

new

dend of 50 cents per share

Members New York and Boston Stock

Wilcox-Gay Corp.

exchange for each pres¬
outstanding common share. It

ent

preferred stock;
shares for sale to
three promoters of the
company
at $5 per share.

TlFFT HltOTIIEKS

*Stromberg-Carlson Co.
^Mid-Continerit Airlines

shares in

common

upon

Insurance Stocks

proposed to issue three of the

*i'

that of

Primary Markets

Bank &

^Pickering Lumber Corp.

stockholders

each share of cumulative prefer-:
•

Jones

sub-?

of $10 par value each to 6,000,000
shares of $5 par value each.
It is

common

been

July 23 on increasing
changing the authorized com¬

and

be j

vote

value

least,

Monsanto Chemical Co., St. Louis,

therefor

will be made
group of underwriters'

headed

also

common

conversion

stock

has
:!:

The

change

and

income

favorable
continue."

mitted to the SEC.

85,000

stock

have

preferred

business

5% convertible preferred stock;
common

will,

annum,

times

Exchange Commission for
15,000 shares of $10 par value
par

through tender at prices not
to exceed par and interest.

sufficient

the

"providing

and

off

pay

doubled,

Co.,

borrow

such shares to the

year.

»Midwest Packaging
Materials,
St. Louis, has filed a
registrastatement with the Securities

"arrangements
to

Mr. Evans also disclosed that
all of the preferred is con¬

The

reports total sales of
for the nine months

$277,845

nine

per

Gleaner Harvester
Corp., Inde¬

pendence,
$3,380,315

given

verted, the common dividend'
rate, which has been 10 cents

July 1, 1946 of the 46,702 shares
of
outstanding
$6
preferred
stock at $105 per share.
*

notes

stock that is not converted."

reimburse the company in part
for treasury funds used in con¬
nection with the
redemption on

❖

that

made

funds

for

excess

will

retirement

opportunity to convert before
the date of the official call."
He

pro¬

note

However, the

sinking fund for

ceeds from the sale of the
3.90%
preferred stock will be used to
pay

to issue immedi¬
call of the preferred stock

redeem

1946,

and

dividends

the

New

York

Curb Exchange on July
15. The cash distribution applied
to both the old shares and on

the stock issued

as a

dend.

payment

cash

cents per share

was

stock divi¬

St. Louis

also made

Connecticut Securities
Hartford 7-3191

$13,500,000,

capital consisting of 2,000 shares
of $100 par stock, surplus of
$300,000 and undivided profits

version of 5%

At the present time the West
Trust
Company has
resources

Kansas

Sons and Stix & Co.

Hartford
total

stock dividend and

Co.

Simon & Co., A. G. Edwards and

The transaction will result in

issue,
20,000
shares
would be reserved for
issuance
to
warrant / holders;
15,000
shares for issuance

capital

initial dividend

City,^
2% on the 4% convertible income
Drug Co., Kansas City, will vote
notes, all payable Sept. 3 to hold-v
Aug. 15 on approving a proposal
ers of record Aug. ,20:
Sons and Stix &
Payment
Co., all of St. to change the conversion rate of
Louis, offered to the public an is¬ the outstanding preferred stock so was also authorized; to". be made
■•i ;o
the Union1 National 'Bank tof
sue
of 40,000
shares of 3.90% that each may be exchanged for
Kansas City of sufficient funds to
cumulative -preferred stock
(par four/ common shares; instead of
retire
$105,960 of outstanding cer¬
$100) of the same utilities com¬ two, as as present; Tom L.
Evans, tificates of indebtedness.
A de¬
pany at $104 per share and divi¬ President of the
company, states:
posit
of approximately $125,000
dends.
*
:
'
"If the plan is
approved, the di¬ was made in the
/• 7'
'-Ji
"1;
H
-.]>
>;

the

Publicly Offered;
banking

have declared

Reinholdt & Gardner, I. M.
Simon & Co., A. G. Edwards and

taled

Burr, Inc., Drexel & Co., F. S
Moseley & Co., Salomon Bros. &
Bridgeport Hutzler, Alex. Brown & Sons,
which it had occupied under lease
Central Republic Co. (Inc.), Hornsince May 1943.
blower & Weeks, Stern Brothers
*
*
& Co., Dean Witter & Co., Stark¬
Terms for the merger of West
weather & Co., Hayden, Miller &
Hartford Trust Company with
Co., Cooley & Co., Cruttenden &
the Hartford-Connecticut Trust
Co., Reinholdt & Gardner, I. M
Crane Go. the

South

Brothers

June

Missouri Power & Lh

and

compares

of 30 cents per share on .the com¬
interest, and oh the same: day another group, headed by
Glore; mon \stock apd - the
regular 4 %
Forgan & Co. of New York, and including,
among others, Stern
nterest and an accumulation of

less.

Aircraft has

Power & Light Co. first
mortgage 2%% bonds, due 1976, at 102.06%

The amount available for fixed

♦

and

ended

$800,000 bringing the
Forgari & Co.,
$2,400,000,
Deposits of on July 12 offered to the public
$74,270,422 were off from $81,- 40,000 shares of 3.90% cumulative
467,587 at the end of 1945.
Book preferred stock of Missouri Power
value per share increased $25.35 &
Light Co.
The stock is priced
to $322.47.
at $104 per share.
total

*
,

senger revenues were about 16.3%

change in the cash

from

Government

with

compares

the

com¬

April 15, last, and one of $1

per share on Jan, 15, this yean

On July 12, a, group/of underwriters headed by
White, Weld ,&
The directors of Flour Mils of
Co.; Shields & Co.; Kidder, Peabody & Co., and W. C.
Langley & Co.,
all of New
York, offered to the public an issue of $7,500,000 Missouri America, Inc., of Kansas City,

negotiating for the acquisition of
Hat Co.
of Danbury.
Stetson Co. now owns 1,250 shares
of the latter company and is con¬

com¬

last year.
*

1..-'

The income account of the New

Co.

was

■■

Bl Stetson Co. is currently

>'fi

Watch

stock

re¬

July 3, 1946, the New Haven York)

ferred

total

Mallory

The Housing
Authority of the
City of Middletown recently sold
$930,-

to Salomon Bros. & Hutzler
000 temporary loan notes

has

sources in
excess
of $126,000,000, capital of $4,000,000, surplus

corresponding period in 1945.

Company

V on.

Missouri Brevities

the month of
May, 1946, the Southern New England Tele¬
phone Company reported an increase of approximately 30.5% in long
month

345

„,

;

Peltason Jenenbaum Co.

markets

New York:

Bell

BUILDIN6"

LANDRETH

BOwling Green 9-2211

Dazey Corp. Com.

System Teletype: HF 365

ST. LOUIS 2, M0.

Dazey Corp. Conv. Pfd.

"-D.240

Teletype—SL 486

R. E. Funsten Co.
Hilton Hotel
Nutrine Candy

Fifty-fifth Year of Dealing in

Taca

Connecticut Securities
Primary

Airways

Southern Union Gas

Berkshire Fine Spinning
Boatmen's National Bank

Markets—Statistical Information

Delhi Oil

Stix & Co.
INVESTMENT

SECURITIES

Universal Match
5O0 OLIVE

Chas.W. Scranton

Co.

SCHERCK, RICHTER COMPANY

Members New York Stock Exchange

London

Hartford

2-4301

7-2669

New York Canal 6-3662
'

Teletype NH 194

Sf.Lomsl.Mo.

Landreth Building

New Haven 6-0171
New

STREET

Waterbury 3-3166

Bell Teletype

Danbury 5600

SL 456

St.

Louis 2,

Mo.

Garfield 0225

L.D. 123

Members St.

Louts Stock

Exchange

THE COMMERCIAL & FINANCIAL CHRONICLE

346

Equitable Office Building Reorganization
The plan for the reorganization of the Equitable Office Building
Corp. which has plagued investors, analysts and traders, alike, during
the past year, has finally been ordered placed into effect immediately,
following denial by Federal Judge Knox of an application, on July 11,
to reopen the reorganization proceedings, by two stockholders, own¬
ing 2,200 shares of common stock, who presented a modified plah
which contemplated the payings ■
v:'
off of the outstanding debentures at par and accrued interest. The
public announcement of this mdiion before the court, for
sever^
days played hob with the market
in Equitable Office Building se¬
curities.
The debentures, which

the

deliberate

the

when

and fully con¬

they

had

than

weather

vane

tery day in March. For this rea¬
son, my consummation order of
July 8, 1946 will stand. It follows
that the application to re-open the
reorganization proceedings of the

SHASKAN & CO.
Mmmbmrt New York Stock Exchange
Members New York Curb Exchange

Dlgby 4-4950

Teletype NY 1-953

The plan as

consummated pro¬
$16,024,123, first
mortgage be undisturbed. Each
$1,000 of the $4,754,000 subject der
bentures will be exchanged, for
$600 in 35-year second mortgage
cumulative income 5% bonds, of
which
$2,852,400
will
be out¬
standing, and 100 shares of com¬
mon.
There will be outstanding

Chanin Bldg. 2/45
Chanln

Bldg. 1/45

500 Fifth Ave. 44 Vz /49

51 East 42nd St. 3/56

that

Each

$1,000

> Members

years

and

HAnover 2-8970

Teletype NY 1-1203

Until

months

500 for

Firm Trading Markets*

tions

the

two

least

—

ifure

free¬

dom the mar¬

business

William K. Jackson

natural forces

capital (total

reserve never

still has little

cause

for concern,

today reiterating our opin¬

are

with

ion

particular

reference to

low-priced but* carefully selected
security issues.

new

R. A.

Keppler & Co. Opens

R. A.

*Radio
from

address

Boston

Broadcasting

business

securities

offices

from

July

11,

New York

Montgomery St., San Franc;sCO

threat of

monopoly and

assure a

Tele. SF 61 & 62

EXbrook 8515

confidence to an era of postwar

-—Specialists in—

REAL

ESTATE

Broad

New

York

the

Amer-

see

Security Dealers Association

HAnover 2-2100

SECURITIES
OFFERINGS WANTED

Hotels Co.

Hotel Bonds with Stock

100 North La Salle St. Bldg.
Madison
Chicago

Hotel
*

Beacon Hotel 2-4, 1958

So.

they
t e d to

war,

that

ca¬

turned

meet

the

needs

America.

To¬

day that

con¬

are

an era

stable

economy.

with
the magnifi¬

——

not work

together for peagethe

time abundance as we did for
war

effort?

Why

can we

not plan

did for

for

happy living
grim destruction?
The

answer

becoming

in¬

clear:
the
domestic
prosperity of America—and with
it the opportunity io build an en4during peace in the world—is
being threatened by the tightening
stranglehold of monopoly on
creasingly

America.

NAM, Handmaiden
And this

can

of Monopoly
nowhere

seen

We
ing.
In
the as clearly as in Congress.
;,
"f /
place of an or¬ faced the postwar period with
new
hopes.
We . Had
derly transition to full peacetime bright
production, the United States has worked toge her in our commit¬
found itself in an era of economic tees and we had produced a legis¬
We were aided
"Boom and bust" is lative program.
which is now held by the experience and intelligence
the people of America: of that selfless, brilliant and hon¬

Tele. CG 660

Savoy Plaza 3, 1956
Sherneth Corp. 5%, 1956
The Madison 3, 1957

870-—7th Ave. 4y2, 1957

Eastern Ambassador Hotels Units

Amott, Baker & Co.
v,

150

*
;
New York 7, N. Y.

Incorporated

Broadway :

Tel. BArciay

7-4880

Teletype NY 1-588

promise
to

jazz age and depression—the same
music we heard before, playing

National Hotel of Cuba 6, 1959

La Salle St., Chicago 3, 111.

Se&i Glen Taylor

forth

Stock Alone

Governor Clinton Hotel 2, 1952

(V. T. C. and Land Trust Units/

FIRST LA SALLE CO.

Hotel Lexington Units

Transportation Bldg., Chgo.

Tel. Central 4424

fidence is fad¬

the

La Salle

has been
373)

uncertainty.

One La Salle Co.
Lott

economy

exp ec

Engineering

request

Street, New York 4

page

prosperity. Having seen

meet the needs

Incorporated
Members

For weeks, this country

capacity

cent

ican

Seligman, Lubetkin & Co.

OPA, this period of freedom
price control is a valuable
experience for every one of us. It
gives us a chance to look at the
facts and doyour own thinking.

from

the people of America looked forward

Less than a year ago

peacetime
on

I
re¬

of economic;
lays blame to a
stranglehold of monopoly. Cites National Manufacturers Associa¬
tion as "handmaiden of monopoly" and accuses it of wrecking
OPA. Accuses other business organizations of wrecking legislation ;
such as 1944 Kilgore Reconversion bill and 1945 Murray Full Em¬
ployment bill, and Columbia Valley and Missouri Valley Reclama-tion Projects. Urges lawyers to advance legislative program to halt;

*Descriptive Circulars

not

vives

legislator, maintaining tve

Textiles, Inc.

*Temple Coal Pfd.

Whether

uncertainty, with "boom and bust" in prospect,

pacity

J. S. Strauss & Co.
1SS

OPA

U. S. Senator from Idaho

Democratic

City.

*WelIman

than

prices.
Congress

controls in stabilizing
-

By HON. GLEN H. TAYLOR*

*Shatterproof Glass

^Tennessee Prod.

the long run would

effective

Stranglehold [of
Monopoly in America

General Crude Oil

Paper

far

obstacles to full pro¬

over

The

abundance

Central

control over prices.
An end
deficit spending and

(Continued

produce
goods
in

*Argo Oil Corp.

operate only as a second¬

Federal

1946.

Real Estate Issues

administration,

wisest

the

can

removal of

the

American

network,

Street,

Wall

Under

OPA

duction

Mr. Jackson

over

borrowing to finance

the government's deficits. That is
the root of the inflation, problem.

time

These forces are
operating
to
bring
about
the
countless readjustments necessary

Keppler & Co., Inc. is en¬

gaging

ex¬

mind, springs basically from the
and Federal

at work in the

are

have

In the

market places.

advarr>

investor

war

Now

securities dur¬

findings.

have

regulations.

submitted in these

our

en¬

terprise

Advances up to 600%

place and

for

tremendous expenditures for war

greatest meas-

California & New York

higher prices, it must be borne in

the

ary

balance

temporarily

inflationary trend.
inflationary pressure

The

charges, $37,-

chargeable

;

teract the

ftr e s t o r e d

manage¬

belief that the long-term

improvements and altera¬

ordinarily

expand production and to coun¬

known since

substantiated

common.

ex¬

bill

tension

the imposition

trend.

tota^ debt is re¬

will

and

OPA

the

ing the then current inflationary

$14,000,000

after first mortgage

nation have had oppor¬

years we as a

cost.

tages of low-priced

all excess
earnings will be used for second
mortgage sinking fund, thereafter
one-half. Available earnings each
six

choice for purchasers.

the crucial test' of
chosing between the Scylla of de|pleted stock and the Charybdis of
inventory acquired at too high ja

into 160 shares of common

duced

For the first time in five

satisfactory

columns cfur views on the

second mortgage

-.39, Broadway ; '
New York 6, N. Y.

new

shelves, and

ket

Last year we

for the next three years into

100 shares.

New York Security Dealers Asjj*.

new

be convertible for

bond will

L i. GOLDWATER & CO.

the

561.610

2 Park Ave. 3/46

—

corporations. Contacts are more
intimate, more personal and be¬
cause
the problems are less in¬
volved, a better conclusion can be
reached by the underwriter as to
the ability of the corporate manr
agement to avoid pitfalls on the
stony road to success.

debtor will be denied."
vides

balancing of supply and demanfl will prevent'
of merchants, manufacturer or larmeiv:

consumer *at mercy

regard to the management
feel that the investor in
comparatively
small
and v lowpriced new issues has an advan¬
tage. The underwriter has the op¬
portunity of closer contact with
management than would be pos¬
sible in the case of large leading

blus¬

Points out

inflationary preventative.

Concludes-there will uowi bo more/competition inbusiness,better

goods

With

right

placing

restored, the

normal and

factor,

to do—confi¬
dently relied upon its integrity,
should be something more stable

they

J. demise.

ment is put to

public—as

the

and

American citizen

the free oper¬

commitments

ward

and

involved,

issues

of freedom in five years/ stresses common sense

measure

price basis will develop. In the
meantime, there are bound to be
difficulties in the making of for¬

objection on the part of any
person in interest, and after all
parties were afforded ample op¬
portunity to be heard on the mer¬
its

sooner

ation of this force is

out

QUOTED

Bell

The

mand.

ble court, made and entered with¬

SOLD

[

spokesman, noting that enterprise without OPA has great¬

of ■!
Says price '
r control was over before Congress voted its extension and before ;
/ President's veto and denies businessmen were responsible !or OPA ;
est

of the law of supply and de¬

acy

sidered adjudication of a responsi¬

BOUGHT

Business

This decision read:

40 EXCHANGE PL., N .Y.

(Continued from page 349)

sooner

"The

for

ticiilaifty involved pr^'siiuatioii^

high and the common stock
quoted 2%-3V4.

was

By WILLIAM K. JACKSON*

aggravated, in our opinion, by 'thle tunity; to. watch markets and business; function without government
;
price control.^
political tampering with the deli
The Presi-lto balance supply and demand,
cate organism of our body eco¬
dent's veto of | return trade to its usual channels,
nomic. We believe in the suprem¬

debentures recovered to their for¬
mer

amortization,

the seconds.

Opportunitiesiii •
|
Newly
Formed Corporations

sion, which is quoted below, the

SECURITIES

additional

Securities of

Exchange, rose from 2% to 5.
Following Judge Knox's deci¬

REAL ESTATE

President, Chamber of Commerce of U. S.

average

Stock

York

New

(never to exceed $750,000) to be
used for first mortgage charges

taxes, and for interest and sinking

market, dropped over-night to
140 bid, and the common stock,
on

Common Sense of the People
ftoof Against Price Control

fund

ter

traded

ceed ,,$250,000),
deductions
for
working capital (latter not to exr
ceed $225,000), but before deprerciation.
Until the first mortgage
has been cut .to $14,000,000, com¬
pany may pay 2% on the seconds
and balance in a special reserve

and

245 bid in the over-the-coun¬

were

Thursday, July 18, 1946

ing:
Must

the
v

est

group

of men whom our late

had
Our
and
widely discussed.*
And not a
single disinterested economist ob¬
jected ;o it.
Yet in Congress, it
bogged down and failed of pas¬
sage.
The lobbies of monopoly
leader, Franklin D. Roosevelt,

himself.
over again like a broken record. attracted1 around
Everywhere the people are ask¬ program was publicly known
what is wrong in America?
we again see starvation in
midst
of
plenty?
Cannot

America's

great, industrial

and

agricultural capacity produce for
peacetime consumption? Why can

attacked it in the Capitol

and the

cocktail; lounge; the ;press and
*An address read for Senator radio of monopoly, disguised as
Taylor before the Convention of friendly visitors, attacked it in the
This
the National L a wye r s Guild, home of our constituents.

Cleveland, 0M July 6,1946,

(Continued

on page

395)

iVolume 164? Number

4508

(THE COMMERCIAL & FINANCIAL CHRONICLE

Looking Ahead Five Years
By ROGER W. BABSON

Philadelphia Stock
Exchange Publicity

Let Free Enterprise Prove Its Worth!

PHILADELPHIA, PA.—A pub¬
licity and public gelations com¬
mittee has been organized by the
Philadelphia Stock Exchange, in

•j

By HON. ALEXANDER WILEY*

| Mr. Babson predicts that in next five years interest rates will :<emam
low; Ihere will be no mass unemployment; real estate will be in
continued demand and will be a
prime investment; and inventories
will be safer to hold than

municipal bonds.

•

Urges diversification

accordance

of investments.
A

book

has

been

written

and published by Harper &
Fifty Years." In this book, I

"Looking Ahead
^ discuss vari-<5>

V>' r

subjects,

ous

such

the

future

in¬

of new indus-

tin-American

countries.

tries,the
changes in
farming, the

is destined to

follow suit

li 11

ok for

busi-

Numerous
readers have

written to

Roger W. Babson

saying, "I will
in fifty years.
expect during

what you
five years."

have

for

the

five

years!

feel about

now

the immediate future.
4

not

and

municipal bonds

investment?

same

certain

merchandizing and other

stocks be

(Special to

SAN

not

safer in

gage

well

Expect Low Interest Rates

in fifteen years at 5%, should you
npt seek 5% interest with reason¬

able safety rather than speculate
even

the "long swings" of the
Of
course,
you

stock

market?

can't

5%
investments
off
blueberry bushes. You must take
pick

time
them.
be

hunt

them

Certainly,

find

and

should not
bonds that pay
interest unless they
you

satisfied with

less than 4%

either tax-exempt
tible.
are

■

•

-■

■■

conver¬

opened

ofr-

Building to

en¬

in the securities business.

Gerald

Above all, should not

investments in coastal cities,
subject to bombing, be very lim¬

ited?

This

does

years

mean

people

conscious

admitted

James S. Brown to

partnership in

Clokey

Miller,

Broadway,

mean

there

Whedon, Inc. is engaging in

become

begin

war-

154 Nassau

readjust

Street, New York City.

real

estate

justment

holdings.

This

process could

fect prices.

OPA

seems

Settle in

Hartmann in N. Y. C.

read¬

Henry

greatly af¬
a

small

some

The President's Veto

Alexander Wiley

out is in order.

2. I believe that the President's
veto of the OPA Extension Bill

voted

was

a
grave dis-serviee to the
American people. When he killed

against the previous

version of the OPA Extension Bill,
which was later vetoed by the

all price

controls, all rental contrals, as well as the one billion
dollar food subsidy
program, he
gravely gambled with the public

President. I know, of course, how
long and how hard and continu¬

ously the members of the Senate

One

felt,

welfare

simply in order to force
Congress to do his exact bidding.

that

Hartmann

has

The President

had

principal defects, I
its failure to decontrol

and

I
times pointed out the

and1

butter,

terior city and buy securities with

York City to engage in a securi¬

assets in such cities.

ties business.

ruinous

the

particular

opened

effects

industry,

production

dairy

ori

the

cheese,

*The

Extension Bill.

livestock products.

many

terrible

ignored Congress's
long and hard labor on the OPA

its

was

dairy

offices at 15 Whitehall Street, New

in¬

evaporated

prepared

text

The Present Situation

has had

the

President's

the

American

system of free

enterprise under the natural

ad¬

tem of supply and demand.

dress in the Senate by Sen. Wiley,

July 9, 1946.

(Continued

page 396)

A*.

I expect continued
employment
THIS

among the masses or else govern¬
ment aid for them when unem¬

ployed.

The

people and
continue to

upper

the

UNDER

NO CIRCUMSTANCES TO

BE CONSTRUED AS AN

their

OFFERING

OF THESE

DEBENTURES FOR

SALE, OR AS AN OFFER TO BUY, OR AS A SOLICITATION OF AN OFFER TO BUY, ANY OF SUCH
DEBENTURES. THE OFFER

middle-clas*

well-to-do

have

MADE ONLY

MEANS OF THE PROSPECTUS.

will

ups-and-

dpwns; executives will again have
their

salaries

reduced

and

$125,000,000

their

dividends, cut yirith corresponding
declines in stock prices; but the

days of
over

mass

Unemployment

for many years.

ican people

American Telephone

are

The Amer¬

to let
labor leaders rule them; but the
days when employers can be ar¬
bitrary are also over. Hence, if
the Republicans hope to return to

FORTY YEAR

DATED JULY

office
are
er

they must realize that we
living in a new world, wheth¬
they like it or not.

j No political party

another

If pri¬
cannot
continue
the government
will do so or else provide wage
subsidies. Hence, in view of the
above, are not the merchandise
stocks, the food producers and

ments?
are

COPIES

THE

high

1. 1986

PROSPECTUS

MAY

accrued

OBTAINED

FROM

interest

ONLY

SUCH

LEGALLY

THE

OFFER THESE DtotNTURES IN COMPLIANCE WITH
SECURITIES LAWS OF THE RESPECTIVE STATES.

UNDERSIGNED
THE

wages

to continue.

Real Estate A Prime Investment

"IX expect

continued

Mellon

properly-located real estate,
especially for homes. Next to food

^nd

clothing,

reasonably-priced

E. H. Rollins a

and

incorporated

Central

i'l Try to avoid large cities, espe¬
cially on the coast. Unless a great
spiritual awakening occurs, the
that

World

War

L. F. Rothschild

and

Co.

Phelps, Fenn a Co.

Hutzler

Hallgarten

:•••.».

pomeroy, inc.
.

Co.

Gregory

stocks

Co.
.

merrill lynch, pierce, fenner a beane

Spencer Trask

Co.

Tucker, Anthony a Co.

Coffin

Burr

Graham, Parsons a Co.

incorporated

Municipal Bonds

good;

Salomon Bros.

•

III

M expect that money invested in

Inventories,

Otis

(incorporated)

vs.

Republic Company

will1 come, when some of our large
cities will' be totally destroyed. ♦
Inventories

Sons
j.

schoellkopf, hutton

are

Bear, Stearns a Col

(incorporated)

enough fertile land
for a "kitchen garden."; Houses
depreciate, but well-located land
should appreciate.

chances

Halsey, Stuart a Co. Inc.

Equitable Securities Corporation

first investment should be in

home

Corporation

The First Boston Corporation

liomes should continue as a prime
investment. Hence, I believe that
your

securities

demand

for

the safest invest¬

Remember,

DUE JULY

100.85% and

industry
present wages,

concerns

2%% DEBENTURES

1946

price

vate

similar

Telegraph Company

survive

can

of low wages.

era

and

not going

are

JULY 17, 1946.

incorporated

Son

vefc*

OPA, the countty
amazing demonstra-*

tion of the fundamental soundness

milk

Since

and the death of

Days of Mass Unemployment Over

economy, ;

Bill, as it was sent to ther
President, did represent many
valuable improvements over the
previous price situation.

straightening

OPA

and reallocate their securities and

free,

sion

and the House had worked

securities business from offices at

propagandiz¬

Whedon, Inc. in New York

that within five

anywhere near
that they might

ing

measure.

not

will

and

has

quantities

have been under

the

The Previous OPA Extension Bill

New York City.

will be another War in five
years,

but it does

Clokey

in¬

been produced

the

re¬

dairy items,
vitally needed in this

In spite of this major
drawback,
I did believe that the OPA Exten¬

CALIF.—

Clokey & Miller Admits

ap¬

are

world of today,
which, thanks to OPA blun¬
dering and ineptitude, have not

actions

that

Chronicle)

it.

necessary

but

Presi¬

Diversification is of great im¬

our

\ expect continued low interest
fates. Hence, since money doubles

Financial

fices in the Russ

portance, but such should be

famine-stricken

iesult

bureaucrats,

Conclusion

dustrially.

The

FRANCISCO,

MacBoyle Lewis has

emergency?

plied geographically

recent days as

sult

MacBoyle Lewis in S. F.

truly prime

business

and

cities

government

May

financial

which

dent's

the Philadelphia area.

position

i?6 confused in

and

consideration, and

situa¬

ahd other

the

com¬

few points regarding the matter of price

tion hks been

munity and it will also assist in

news

are

concern¬

under

now

The

committee

by the Philadelphia business
many

handling

Hence,

centrol

I should like to submit

^'-7V

The" newly • formed

dollar, while the sales of the

up.

livestock products.

ing the backing of the Exchange

•

seen

com¬

Exchange
appointed

yvill "deal with questions

well

the

held

new

with

firms will

to the group.-

England
as

The

Baker.

connected

member

course,

a more risky
thing to do.
i, too, will be dead before the end
of fifty years, while I hope to be

But here is how I

when

nearest

municipal bonds of Southern cities
default and sell for 20 cents on

this is

a'round

already

Chain Stores in these

labor rule.

Frank

most of the. La¬

other countries.

our

au¬

mittee will bring with it a change
in the-Stock. Exchange custom,
Mr. Baker stated, since persons

nany municipal bonds may be in
default. - This situation now exists

neighbor, and in

the

safe

developm en.t

| nesses and the
^possibility of

Tell

continue

In Mexico, which is

Ismail

gone

will

vestments, the

be dead and

homes

recent

Republican legislator scores President's OPA veto and praises
j American industry for restraining price increases. Pleads free
i enterprise should be given chance to prove its integrity, and asks for
a test period
during which Slates can demonstrate their adequacy
; to handle price situation.
Objects Ito price control of dairy and

the

U. S. Senator from Wisconsin

•

Exchange's
board of governors, according to

Brothers entitled,

the

with

thorization

■

;

Hayden, Stone a Co.

sys¬

THE COMMERCIAL &

348

measure,

Protests Subsidy to Silver

Interests

etary Policy to
members

the

who

below:

"On May 10
66 monetary
econ

sent

omists

bers

mem¬

Con¬

state¬

gress

ment

urging

end

its

fixing of sub¬
sidy prices for
the
Walter E.

Spahr

silver

e r

e s

in-

ts and

urging that

its

cents per ounce,

price

90.3

the buying price

to be permanent at that level.
"A
any

Congressman who endorses
such proposition as this can¬

not at the same time
state that he is

virtues of free

consistently

believer in

markets.

Nor

the

this

silver

objective stu¬
question, are

Congressional ac¬
tion such as you are engaging in
now inj ured China and other sil¬
ver-using countries, and now In¬
dia is experiencing difficulties be¬

silver

sent

was

following:
Representatives: Joseph Martin,
John W. McCormack, Louis Lud¬

priced at $3 per share.
The cor¬
poration produces all-metal pre¬
designs,
manufactures and installs a wide

Taber, Gordon Canfield, Frank B.
Keefe.

Senate and House Clash

Silver

purchase

tion fixing the silver price and reenacted it

separate

measure.

two

years

$1.29

pro-forma balance sheet as
of June 1, 1946, giving effect to
the issuance of the new stock,
showed
270,000 common shares,

which in ef¬

ounce,

vision of the Senate's

it is reported that some are melt¬

industrial

ing down silver'dollars and other
coins to obtain the necessary raw
material.

noted

passed by the Senate, the
price of silver is to be raised after

has a contract
pre-fabricated houses.
Fifty houses completed under the
The corporation

fect permit again the free coinage
of silver, a situation that has not
existed since 1873. It is this pro¬

In the meantime, industrial users
ef silver are short of supplies, and

value, and $102,750 longterm mortgage notes outstanding.

of $1 par

to its monetary value

per

for

"sound

users

money"

silver

but

advocates.

elsewhere

the

aavp.rtisemp.7it

for

sale

not,

and

will

made

be construed

offer to

buy

any

only

the

Prospectus.

Plants

Monetary Policy has protested
against the passage of the Senate
■■fcwCr ■'
«

were

made

pre-fabricated

houses

are

located

Denver

and

Littleton, C.olo.; Ogden, Utah,

and

Spokane, Wash.

as,

of such securities.

i,!

circular

the

com¬

several

ferred

Innumerable

details

had

sub-holding companies to

pany

stocks

have

financial

amounting

structure

dividends

its

paid

has

(it

stock

common

held

by the public

reduced

been

the most important
being Cities Service Power &
Light, and the latter in turn con¬
trolled the Federal Light & Trac¬
tion system; a few gas subsidiaries
were
directly controlled by the
top company. Federal had a good

and at the same time

struction

$217,000,000
$426,000,000

invested

been

has

new

con¬

acquisitions. How¬

and

the parent company has ac¬
cumulated preferred dividend ar¬

ever,

rears

Abraham

its

preferred

$47,911,250.

stocks

Company estimate
should ulti¬

since 1937) but its properties were

that

somewhat scattered. A number of

mately obtain $70-$80,000,000 for its
utility equities which with other
available funds should then suf¬

subsidiaries

have

posed of and

dis¬

been

now

final plan of liquid¬

Cities

Service

ation has

fice to retire the remaining $100,-

A proposal was

000,000 parent company debt. This
would save (along with the recent
retirement of $35,000,000 bonds)

recently been announced.
recently submitted
to the SEC to merge the four re¬
maining subsidiaries, located in

along to the stockholders of Fed¬
eral. The latter already has cash

enough
sale of

proceeds

(including

147,000 shares of common
Light

stock of Tucson Gas Electric

& Pov/er

Company) to retire its
preferred stock.

own

Cities Service P. & L. itself has
considerable

made

to¬
ward final integration. Ohio Pub¬
progress

lic Service, its

principal operating
subsidiary,
has
refinanced
its
bonds and preferred stock, paving

the way for later sale

stock.

This

of the
turn

com¬

should

permit liquidation of Cities Serv¬
ice Power & Light's bank loans
and facilitate transfer of its assets
to Cities Service Co,

interest charges
largely
offset the loss of utility earning
about

$6,750,000

which it is thought would

power. It is suggested that pre¬
ferred stockholders might then be

offered

a new

4% preferred in ex¬

change for the old issues, in the
amount of call prices plus arrears

($113,486,250).
For
ice

some

years now

Cities Serv¬

earning

(on a con¬

been

has

solidated basis) over $3 a share on
its common stock. Last year

solidated

income

Federal

Con¬
taxes

amounted to $3,101,224 and excess

taxes

profits

(including charges

in lieu of taxes) aggregated

about

$3,586,287. Tax savings under the
new
law may be
estimated at
about 60c a share and would pro¬
bably be considerably larger after

adjustment for accelerated plant
depreciation. While it is too early
to appraise the company's, earn¬

Empire Gas
Fuel;' subsidiary of Cities Serv¬ ings on the new issue, Abraham
ice, recently redeemed $18,000,000 & Company's estimate of $3.25 a
seems
conservative, con¬
debenture bonds, and the parent share
company itself retired $35,000,000 sidering the strong current posi¬
debentures
out
of
accumulated tion of the oil industry and favor¬

offer of these securities
The

recent

settled before the utility interests
could be disposed of. There were

ing-power.

mon

in the future.

is tinder no circumstances

June

expected that aluminum
the basic metal for the

company's

"Chron¬

icle," the Economists' Committee

solicitation of an

steel. It is

this

1,000

contract

version, that
objectionable not only to the

pre¬

in^-

deadlock, though to expedite
the passage of the appropriation
hill, the Senate removed the sec¬

for

fabricated houses.

to sell surplus silver to industries at 90.3 cents per ounce.
The House
had already passed a measure fixing the price at its present level, 77.1
cents per ounce. Although a conference committee has been set up,
the

materials

Abraham & Company point out
in

that Cities Service Company
in the past 15 years has reduced
consolidated
interest
charges
nearly
one-half,
the
saving
amounting to over $4 a share on
the common stock. Bonds and pre¬

the
financing will be used by the New Mexico. The new company
company to liquidate current ob¬ will have
524,903 shares of com¬
ligations.
The balance will be mon stock, all owned by Federal.
available for general
corporate Presumably stock of the new com¬
purposes and devoted largely to
pany will then be sold or passed
the proceeds from

Part of

to the Post Office and Treas. Dept. Appropriation Bill by the Senate,
which fixed the price at which the Secretary of Treasury is permitted

break

and

sheet metal products.

Bailey.

houses

variety of building construction
metal products. It also galvanizes
and retins metals and fabricates

Senators: Paf McCarran, Carl
Hayden, Chan Gurney, Clyde M.

shares of Fox Metal Products

fabricated

Service's

be integrated,

Corp. was made July 16 by Frank
C. Moore & Co.
The stock is

Emmett
O'Neil,
Thomas
D'Alesandro, Jr., Herman P. Kopplemann, Clarence Cannon, John

During the week, the House refused to accept the rider attached

immediate

Senate from its de¬
90.5 cent purchase

offering of 99,000 com¬

Public
mon

low,

Josiah

Fox Metal

the

for the public welfare in prefer-

for

scandal?"

message

he take the position that he stands

there

by the

price.

disinterested student of sil¬
knows is our disgraceful na¬

has

structive factor in its future earn-

mand

every

System interests are about two-thirds oil and gas, and one-third util¬
ity, and the management decided some time ago to liquidate the
utility properties (at least as far as necessary to conform to the Act)
and thereby escape SEC regulation.
In recent years the addition of
the Lake Charles Refinery, de-®—
voted during the war to the pro¬ ness through its subsidiaries, re¬
duction of high octane gasoline, mains to be clarified.

announced there will be no reces¬

"Does it not disturb you to be a

ver

Cities Service Company
Cities Service Company has had a complicated problem to con¬
form with the requirements of the Utility Holding Company Act.

substantially improved Cities
position in the oil in¬
dustry, and should remain a con¬

sion

party to the continuation of what

Utility Securities

conferees has

One of- the Senate

of the silver bloc's tactics.

cause

Reed, Kenneth McKellar, Millard
E. Tydings, Wallace H. White, Jr.,

can

Ky.), Murdock (D., Utah), Taft
(R., Ohio) and Millikin (R., Colo,)
and
Reps.
Spence
(D.,
Ky.),
Brown
(D., Ga.), Patman
(D.,
Tex.), Wolcott (R., Mich.) and
Crawford (R., Mich.).

"In the 1930's

The

fix

advocating what is in the public

tional

ence

ing and Currency committees of
both houses gives the line-up now
as
follows:
Sens.
Barkley
(D.,

interests?

Congress permit the price of silver

"It is reported that the Confer¬
ence Committee on Silver has now

certainly

are

dents of

to be determined in the open mar¬
ket of the world as it should be.

agreed

"Is it not reasonable to assume

that these 66 monetary economists

ther

group.

fur¬

joint confer¬
committee from the Bank¬

The naming of

serving a small pressure

Congress

indicated

price of silver will be passed
Congressional session.

the

—

ence to

Public

:Ul-.

■'

yet that a compromise bill on

at this

sent by Dr. Walter E.
of the Economists' National Com-

mitee onMon-

Thursday, July 18, 1946

■

Congress set for the latter part of
July, there seems little indication
as

IX, the following telegram was

Spahr, Executive Vice-President

favor to a special
of public
adjournment of

interest, at the expense
Welfare. With the

Dr. Spahr, Executive Vice-President of Economists' National Committee on Monetary Policy, wires members of Congress that fixing
of 90.3 cents per ounce for silver serves a small pressure group,
but stands in way of public welfare.
On July

FINANCIAL CHRONICLE

offering

The

cash.

Natural
both

position of Arkansas
Corp., which does

Gas

wholesale and retail busi¬

able developments

Cities

the
over

with respect to
oil business

Service

the past year or so.

NEW ISSUES

PUBLIC UTILITY STOCKS

Sterling Electric Motors, Inc.

many

$500,000
Fifteen-Year

public utility companies and

the facilities of our direct
,

5% Sinking Fund Debentures
Due

system are especially
trade
our

May 1, 1961

those

various

through

private wire

equipped to

markets where
offices

are

located.

(With Common Share Purchase Warrants Attached)

Price

in the stocks of

We maintain an active market

Paine, Webber, Jackson & Curtis

100% and Accrued Interest

ESTABLISHED

1879

29,709 SHARES
COMMON STOCK
($1.00 PAR VALUE)

Midland Utilities Common

Price $3.50 Per Share

Copies
which

the

Prospectus

the undersigned

which

are

obtainable

from

the

legally authorized to act

such

Prospectus

may

Midland Realization Common

undersigned
as

legally

dealer

only

States

securities

and

Portland Electric Power 6s/1950

in
in

distributed.

Gilbert J. Postley & Co.

MAXWELL, MARSHALL & CO.

29 BROADWAY. NEW
'

YORK 6, N. Y.

Direct Wire to Chicago*

\ iWr4»s
KPT*! "Ls**:

ftri

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4508

R. L. Norburn

Life Insurance and Inflation

CHARLESTON, W. VA.—ft. L.
Norburn has formed K* L. Nor-

By THOMAS I. PARKINSON*
President, The Equitable Life Assurance Society of the U. S.

burn

is the low interest rate

fiscal

'• r<J~

Vjk'r

"Life Insurance," said Chief Justice Hughes some years ago, "is
the world's best bet." Certainly the man who at 30 pays $25 for a

$1,000

o r

d i-

life poli¬
and
dies

deposits which the people use for
money as freely and fully as they
use money itself.
Like all savings, the proceeds of
life insurance policies will buy
less if prices continue to rise; and
prices will continue to rise despite

nary

within

first

the:

has

year

made

good

deal

for

his

benetfic i ary,
He has in ef¬
fect

efforts

estab¬

lished

of
a
small frac¬
cost

tion

cof., that

amount.

For

another

$25

most
so

can

T. I. Parkinson

ah-

the

well for

until

even

second year and
the tenth year

when, having paid $250, it is still
that

true

dies

within

that

the odds—represented by his
payments against the company's
payment—are still very favorable.
year

All

of this

that life in¬

means

is a hedge against infla¬
tion; for prices would have to in¬
crease 400% in 10 years to make
the
$1,000
of
less
purchasing
surance

value

than

the

total

commercial
to

money

York

New

called for

Reserve

halt in
banks

them

enable

Bank

loans by

bonds.

Federal

Reserve

authorities

tinue to make loans to their

pose

future

ings;

usefulness

all

sav¬

but

it is more detrimental
in its effects to savings bank de¬
posits and government or other
bond investments than it is to life

insurance.
years

At least for the first 20

life

insurance

policy¬
holder has paid
less than the
estate which the proceeds of his
policy will provide for the benefit
of his estate or dependents.
a

The

most

important threat to
currently due to
inflationary trends is the low in¬

life

insurance

terest

the

earning

insurance
the

which

rate

pairs

seriously

In the past

Army.

Bros., Inc.

PATERSON, N. J.—Samuel N.

Now

Siegel & Silver

The New York Stock Exchange
way,

its

Siegel & Co., 39 Broad¬
New York City, has changed

name

to Siegel & Silver.

This is under

offer to buy,

any

the year, and money to take care

sult in

Bankers, mortgage lenders and
real estate

men

of
a

maturity

mortgages
over

15-year period, it is necessary

invest

this

way

quality

•

mutual

owner

guar¬

protection

for

and the mortgagee.

^7' r

V!'
1
(

V.'

-U 'J.

?r..

Simons, Linburn To Admit

all realize that in

packaged

of
'*

Simons,
Broad

Linburn

Street,

New

Co.,

York

City*

members of the New- York Stock

Exchange

will

admit

Harry

Schwartz to limited partnership in
mainte¬ the firm on August 1st.

building.

repair and

as an
offering of these securities for sale, or as an offer to buy,
of such securities. The offer .is made only by means of the Prospectus.

or as a

NEW ISSUES

solicitation of f f

July 17, 19461

Gatineau Power

direct

Company

(A Quebec Corporation)

con¬

tribution to the inflationary trend.
It
is
these unsound financial

policies

case

brought to

corporate, which re¬

much

antee

both the

of insurance premiums when due.

of buying similar bonds, gov¬

ernment and

may

little higher but it will be

circumstances to be construed
an

leasing have

which
includes amortization
of
the principal, interest on the
loan,

the

firm of

house, according

reports of a survey by field officers of the FHA.
Ninety percent of:
these families expect to finance
their homes by means of
packaged
mortgages or amortization plans payable over a term
of years. The
majority, it was shown, favor a mortgage
maturity range from 10 to
14 years.
>
;
v
Packaged mortgages permit the nance costs
will have a much bel¬
borrower to pay into
lending in¬ ter opportunity to pay off their
stitutions one sum each
month, obligations.
First cost

taxes which are accruing
during

Schwartz will engage in a securi¬
ties business from offices at 64
Hamilton Street.

$45,000,000 First Mortgage Bonds 3% Series C Due 1970

which

Dated June 15, 1946

Due
Interest

June 15, 1970

Payable June 15 and December 15

Principal and Interest Payable in Lawful Money cf the United States

tain the low interest rate that be
devils the managers of life insur¬
ance funds and increases the net
cost to the

Price 104.37% and accrued interest

policyholder of his in

Rather

surance.

than

emphasiz

ing the possibilities of future de¬
in the

creases

purchasing value of

the proceeds of his

policy, life in¬
policyholders should be,
and I think now are, emphasizing
the
detriment
which
they are
presently suffering from a low
surance

$9,500,000 Sinking Fund Debentures 2H% Due 1961
Dated June 15, 1946

interest rate maintained and main¬
tainable

only

continuing in¬
creases in the money
supply of
the country.

Interest

Payable June 15 and December 15

Principal and Interest Payable in Lawful Mcncy cf the United States

Price 101.23% and accrued interest

Drag Co. Inc.

life

Perhaps

Due June 15, 1961

im¬

power

investments.

with A. W. Benkert & Co.

Schwartz in Paterson

con

of boom and inflation which main¬

the

and Leach

mem¬

effects

savings?

was

ber banks to be used for the pur¬

ought to be re¬
served for a period of depression
instead of being used in a period

the

nation's families now
renting
expressed the intention of buying.or,
building a

individuals

premiums
paid by the insured. Why then do
prophets of ruin through infla¬
tion generally use life insurance
as their illustration of
inflationary

Inflation, decreasing the pur¬
chasing value of money, affects

the

purchase gov¬
This, Mr. Sproul
said, was contributing to the in¬
flationary trend. Nevertheless the

ernment

2527

Manager for
Investors
Syndicate. Prior thereto he served

Our

an in¬
supply
through encouragement and assis¬
tance by the Federal Reserve Sys¬
tem to current bank purchases on
the. market.of government.bonds
and long term'corporate bonds. A
few days ago President Sproul of

the

crease

One-Third of Nation's Families to
Buy Homes
One-third of the

money

continues to rise.
financial policies still favor

$1,000

our

supply

esta te

control

offices

District

with

Co.

gage in the securities business.
Mr. Norburn has recently been

Holds it is unsound

investments.

policy to maintain
low interest rate in boom period.
•'.

Kanawha Boulevard, East, to en¬

Insurance executive asserts the most serious threat to life insur¬
ance

Opens

Own Firm in Charleston

349

Volume 164

solvency of a life insurance
and certainly its divi¬

company

dends

which

determine

the

net

Offering of 54,00 shares of 30

cost of the insurance

cent

minimum interest earning

ferred

depend on a
of ap¬
proximately 3%. It is difficult for
life insurance managers to invest
the large funds committed to their
in

care

that

dependable investments at

rate.

What

life

insurance

cumulative

dividend

pre¬

Copies of the Prospectus may be obtained from any of the several under¬
only in States in which such underwriters are qualif.ed to act as

stock, par value $5 per
share, and 54,000 shares of com¬
mon stock, par value 10 cents
per.
share of Loew Drug Co., Inc., was
made July
15 by First Colony
Corp.,
and
Childs, Jeffries
&

writers

dealers in securities and in which such

Thorndike, Inc. The stock is being

for

some
years is that the low
interest rate from which life in

offered in units each consisting of
one
share of preferred and one

Blyth & Co., Inc.

policyholders are cur¬
suffering
is deliberately
artificially
maintained
by
financial policies of the Federal

share of common, and is priced at
$5.50 per unit.

Harriman

government which have built up,

general corporate purposes. It is
expected that these proceeds may

surance

rently

and

are

maintaining, and threaten to

increase the supply of money
this country.
It

how

difficult

responsible

fail to

understand,

should

comprehend
public officials
or

perhaps

one

conceal, their under
standing of the fact that the mod¬
say

method

of
increasing the
supply by simply printing
paper money is wholly responsiI ble for the current low interest
ern

money

In days gone by when gov
ernments needed funds for cur-

rate.

| rent

new

departments

purchases of

additional inventory.

capitalization
of
the company, after giving effect
to this financing, will consist of
54,000 shares of 30 cents cumula¬
tive dividend preferred stock and
225,000 shares of
The

June

company

common

was

1946, as successor to a
company originally organized in
1939, known as Loew Drug Co.

drug stores in Texas. Two

: ernments

in similar need

cur

rent funds do not need to resort to

printing paper money. They have
respectable means of doing the
same
thing through increasing
bank

credit in

♦Statement

the form

of bank

released

by
Mr.
Parkinson through the Continental
Press

Syndicate,

Brightwaters,

N. Y.

Ripley & Co.

Goldman, Sachs & Co.

Kidder, Peabody & Co.

Smith, Barney & Co.
Union Securities

Mellon Securities Corporation

*Stone & Webster Securities

Corporation

Harris, Hall & Company

White, Weld & Co.

Corporation
Hallgarten & Co.

*W. C. Langiey & Co.

Hemphill, Noyes & Co.

(Incorporated)

Lee

Higginson Corporation

F. S.

Coffin & Burr

Moseley & Co.

Incorporated

cated

San

mont.

chain of four retail

Corpus

Antonio

and

Christi,
one

Hornblower & Weeks

are

lo¬

one

E. H. Rollins & Sons

Laurence M. Marks & Co.

Tucker, Anthony & Co.

G. H. Walker & Co.

Incorporated

Alex. Brown & Sons

Dominion Securities

Corporation

Incorporated

Estabrook & Co.

McLeod, Young, Weir

Riter & Co.

Whiting, Weeks & Stubbs

Incorporated

■

The Wisconsin

Company

Dominick & Dominick

Granbery, Marache & Lord

Putnam & Co.

Starkweather & Co.

The Milwaukee Company

Beau¬

Chace, Whiteside & Warren
Incorporated

Andrew Hughes Dies
Andrew J. Hughes died at his
home at the age of 49 after a
long
illness,.
.Mr. Hughes was with
Laird Bissell &
Meeds u prior
thereto he had been a partner in

Hughes & Treat.

W. E. Hutton & Co.

A, E. Ames & Co.

It operates

gov-

stock.

formed

remembered

Now

Glore, Forgan & Co.

Outstanding

expenditures they printed
money with disastrous and long
results.

legally be distributed.

Incorporated

Net proceeds to be received by
the company will be available for

be used for the acquisiiton of ad¬
ditional store units, creation of

may

The First Boston Corporation

have been emphasizing now

men

Prospectus

Hayden, Miller & Co.

Company

Bosworth, Chanute, Loughridge & Co.
McDonald & Company

The Illinois
V*'

*E. W. Clark & Co.

Minsch, Monell & Co.
*Underwriters of Debentures only.

Arnold W. Jones & Co., Inc.

Perrin, West & Winslow, Inc.

will nbwM

ward, probably to $65 million.
Newsprint

Canadian Secnrities
WIUJAM McKAY

;

Effects of Canadian

as being indicative of the Domin¬
ion's economic strength, in spite of

Mar Revaluation

will be

the fact that the effect
,

Canadian1

The
stored

prices

the

dollar

Canadian

imports

re¬

the

Britain

increase in the cost of

-It

from,? Canada.

was

noted, the "Times" dispatch con¬
tinued, that even before the col¬
lapse
of price
ceilings in .the

;to parity with the United

States dollar with

notable gain*
newsprint which,!

last week. The most

was

announce¬

the Canadian Govern¬ United States
prices there had
have been in
ment on Juiy 5 of the adjustment,
risen by 33%
whereas those in
with higher prices and the pros-t as reported from Ottawa by the
Canada had gone up only 20%,
pect of perhaps even, higher prices Assoc. ated Press, The stated rea¬ and
last week
it was argued that Canadafor
its
products,
has regained son was to ease "the inflationary was wise in
V" '
Significantly perhaps, a rumor spread through
seeking to insulate
pressures
which
now
are
so
Ontario on Saturday that the United States dollar had dropped below nearly all its losses.
herself against the effect of the1
strong,"
abandonment
of price removal of controls
Some
observers
are inclined to
by her south¬
par and merchants were reported *>■
tomary eagerness. Where possible^ attribute some of the buoyancy control in the United States being
ern neighbor.
not accepting it with their cusj
•
jfu
Under
the
Government
they
made., change Mn
United shown by stocks; to the steadiness ci ed.
"if Canada succeeds in holding
States money, it was said, so as of
ruling
banks
and
other
authorized
the
bond
market.
Internal
down her internal price level the
not to have too much of it on
Dominion of Canada issues have agents ;of the Exchange Control
•cost In dollars £f Canadian, good's
hand—just in case. Earlier in the remained firm in Canada and have Board will purchase United States
bought by Britain' will be less
week, Reuters News Agency of leveled off in New York to about dollars at $1 in Canadian funds
than
it
otherwise
might
have
and sell at $1.00%. Similarly, it
London carried a story from Lon¬
2%
below the Canadian pr:ce
•been,
in the opinion of authorities
was reported, the buying rate of
don contending that there was a
level. The external Canadian mar-j
here, and this will operate as an
run on American money and hold¬
pounds sterling now will be $4.02
ket has been featured by con*:
offset to the increased cost of
ing that "Canada's move in .rais¬ tinued strength in Province of and the selling rate $4.04. Previ¬
Canadian exchange."
American
dollars
were
ing her dollar to parity with that Alberta and Province of Saskat¬ ously,
■KSM
of the United States is widely in¬
bought at $1.10 in Canadian funds
chewan bonds.
"
and sold at $1.10%.
The buying
terpreted as depreciation of the
rate for pounds sterling was $4.43
United States dollar against the
Foreign Exchange Control
and the selling rate $4.45.
Canadian rather than as apprecia¬
The desirability
of extending
Three other steps were taken
tion of the latter."
Internal Bonds
Canada's foreign exchange con4
by the Canadian Government at
However, on the free market
troL which has applied chiefly to
Winthrop A. Mandell, who has
the same time, as announced to
in New York,
Canadian dollars
the United States to all the cofln-f
the House of Commons bv Fi¬ been active in Wall Street for
sold at a discount of around 1% %.
tries of the world was pointed out
nance Minister
J. L.
Ilsley, to much of the period since 1915 and
Canadian manufacturers were
by Louis Rasminsky, chief of the "implement this country's deter¬ who for the past three year« has
inclined to feel that parity was the
been
associ¬
Foreign Exchange Control Board mination to maintain order, sta¬
equivalent to the removal of a
Markets maintained
to the House Banking and ComT
ated with the
bility and independence of Un¬
10%
tariff on American goods.
merce Committee at Ottawa. Ras-r
Tax
Founda¬
economic and financial affairs."
on all issues

the revaluation of the Canadian dollar to
parity with the United States dollar were observed in a number of
developments in the financial and business circles -of Canada during
"

Recovers

exchanges have recovered some-;
what from the sharp declines of!

Stock

Thursday, July 18, 1946'

FINANCIAL CHRONICLE

THE COMMERCIAL &

350

Interesting reactions to

ment

Southwestern

DOMINION OF
CANADA

W. A.
N.Y.

This

fear

was

counter-balanced,

however, by the

expectation that

rising prices in the United States
will tend to neutralize any price

which

advantage

Direct Private Wires to
Toronto and

Buffaloj

goods may seem
the Canadian markets.

interests, adversely

Gold mining

Montreal

United States
to hold now on

parity, were vocifer¬
ous for an open market
in gold.
Rodney
Adamson,
ProgressiveConservative member from York
affected by

Ottawa a 6-point
calling, among
other
things, for establishment of a free
market for gold in Canada with
unrestricted sales and removal of

West

Dominion Securities
Corporation
40 Exchange Place,
i

Bell System

New York 5.N-Y,

Teletype NY

1-702-3

urged at

program

policy, (2) Canada was heavily
in debt, and (3) the sterling area
would be operated under that sys¬

goods and services that will re¬
main subject to price control, in¬

from trading

New

2-7231

NY-1-1045

in
in

almost

Canada

life

insurance
and Newfound¬

With

selling for

gold reported

$110 an ounce in Greece and $67
in
Bombay,
producers thought
there would be a large foreign
market for Canadian gold.
Ca¬
nadian comment on the proposal

Prospectors' and

64 Wall Street, New

WHitehall

York 5

Canada's

May

$3,305,702,000 against
$3,237,508,000 at April 30 and $2,562,943,000 at May 31, 1945. Call

amounted to

amounted

loans

$124,511,000

$151,820,000 oh
April 30 and $125,433,000 on the

compared
same

with

date last year.

Canadian

Electric

General

million debt will be

further.

delayed still

Council

City

tion of time,

has

the

May as com¬
- -

{

light

the

circumstances. He pointed out

plans to issue $85.4

Lindley Johnson & Co., Commer¬
cial Trust Building.
Mr. Webster
has been with the firm for a num¬

{

Provincial

Corporate

Incorporated

14 WfcirStreet, New York 5
Direct Private Wiree to Toronto & Montreal

Exchange,
Edwin Posner,

President, announced today.
Mr. Mandell's appointment rep¬
resents

campaign

important step in a
outlined by the Curb

accelerate the flow
list of securi¬
ties accorded a public market on
its trading floor, Mr. Posner stated
Exchange to
of

new

making the

improving the

issues to the

Identified

control, en¬

announcement.

with the

investment

importations of scarce

developments

outside

our

ders."
The Government's action in re-

valuating the dollar was reported,
in advices in the "Wall Street
Journal"

July 8,

to have had
gold mining
Mines, which

adverse effect on

the

Dominion.

their gold at the

have been selling

United

States

Treasury

price of

$35 an ounce, which amounted to
$38.50 -in Canadian currency, will
now
receive only $35. It is pre¬
dicted that this may force some
mines to close down.
Canada's

pulp

industry it was

and paper
also faces

promotion and public rela¬
capacity from 1939 to 1941.
His experience also includes af¬
filiations with a number of well
known stock exchanges and overthe-counter firms both in and out¬
side New York from 1915 to 1939

bor¬

loss of income

tions

salesman, sales manager,

whole¬

saler, and head of purchasing and
new business departments.
Dur¬

period his articles and
subjects relating to the
security business were widely rec¬

ing

this

lectures

ognized.

Following his previous associa¬
Exchange, Mr.
Mandell was active in 1941 in the

tion with the Curb

raising of funds for the New Jer¬

Committee for Constitutional
While with the Tax
Foundation
he
was
associated
creased to
with the Executive Director, ren¬
of this.
assistance to State tax¬
A wireless dispatch to the "New dering
York
Times" from London on payer associations in many sec¬
tions of the country in outlining
July 6 stated that the Canadian
their programs, building budgets
dollar revaluation had won ap¬
and resolving their problems.
proval in British financial circles
sey

Revision.

F0 R

HELP WANTED

•

! POSITIONS WANTED

OTHER CLASSIFIED ADS

Wood, Gundy & Co.
■V;'

Municipal

Winthrop A. Mandell

major effects of "adverse

from the

Government

the recent

Abitibi Power & Paper Co., Ltd.
5% First Mtge. Bonds, due June 1, 1965

business

partmenfc
be ng
organ¬
ized
by the
e

banking and security industry for
goods and facilitating an orderly more than 25 years, Mr. Mandell
is
not a stranger to the Curb Ex¬
postwar adjustment of the Cana¬
dian economy, while protecting it change, having been on its staff

Bought—Sold—Quoted

CANADIAN

new

$1,800,000 a
can be in¬
offset at least a ,part of

Lmdley Johnson & Co.

an
to

in charge of a

living and

cost of

costs,

Ex¬
as

President

the

payments.

amounting to nearly
month unless prices

PHILADELPHIA, PA.—Lindley
Johnson, Jr. has admitted Jam^s
C.
Webster
to
partnership • ijn

•

the

couraging

said

Chairman

markets and amounts

determined

distribution

pared with April.

3-1874

SECURITIES

change

he said, was
preventing undue in¬

effectiveness of price

banks

million in the New York market ber of years.-

& COMPANY

Curb

program,

production

deposits

chartered

creases

July 7 were $144,714,000, a 10.1%
decrease compared with the fig¬
ures for the same period in 1945,

Savings

new

aimed

month of 1945. Gross earn¬

Developers' Association, also took bought 35 acres in London, On¬
up the question of a free market
tario, for construction of a new
for
gold with Finance Minister factory for the manufacture of
electric appliances. The-Domiriion
Ilsley at Ottawa on Friday.
Because of parity, the proposed Bureau of Statistics reported a de¬
cline of 4.4% in manufacturing
refunding of the Montreal $202

that original

TAYLOR, DEALE

The

York

assistant

which now are
•

strong."

May totaled $105,535,000,
68% higher than in the

the

New

■

ordinary

York,

joined the

staff

control in
said Can¬
would
a

tions.

new

RECTOR

the

uranium

ings of the Canadian Pacific Rail¬
way Company for the year up tb

to be floated will now have to be

same

J. O. Asselin said that the ques¬

NEW YORK 5f N.

has

Inc.,

New

ac¬

July 6, were

material out c*. the. retention of subsidy
Mr. Ilsley referred to
which atom bombs are made. The
list of individuals and firms with abandonment of price
the
United States and
whom Canadians were forbidden

for

and

TWO WALL STREET

Territories

Northwest

tion,

was

all household
of the princi¬
ples of price control on domesric
products and more strinsrent price
control on imported products; and

has

years

President of the

INCORPORATED

government

Press

cluding ; virtually
articles; retention

prospecting parties into the

sales

foreign currencies that
would be paid for the gold. Mrs.
V.
R.
MacMillan
of
Toronto,

A. E. AMES & CO.

Canadian

The
sent

actions,

Associated

the establishment of a long list

tem.

land

or sales on the open
exemption of all new
from taxation
for three

dollars the

CANADIAN STOCKS

counts from Ottawa

purchases

free gold dwelt on the difficul¬
ties that would exist to convert
into Canadian — or American —

CORPORATION

going through a period of uncerr
tainty on monetary and economic

market,

MUNICIPAL

pressures

corporations, free gold

and abolition of the excess
profit tax on all mining opera¬

PROVINCIAL

additional

noted

■

mines

GOVERNMENT

These

during the war-has. ada's new measures
long way toward insulating Can¬
been revoked.
import and export, restrictions, !
ada against unfavorable external
'
' «T.:
^
—g ..
provision for the purchase of gold
conditions and easing the infla¬
Life Insurance Sales Up
for use as reserve by Canadian
tionary
banks and

CANADIAN BONDS

minsky said such action should be
taken because (1) the world was

SEE INSIDE BACK COVER

i64^' Number'^508

THE?3X)ife

351

mmhm

national income

a, IS^

^New -Y«IL
: ers they diould |Tot ¥el<ixrt)tft ^et
readyttt 6eil aiid -Wafintaiio cl&se
j and harmonious relations with customers.,
? / ,
>,
*
^

•

selves

the Pon'tiac

they will

Motor

Divi¬

rather than sprinters.

sion

Gen¬

would

production capacities'; of our
plants are unleashed. And they

the land like a j.
October, how¬

the: forest -fire "got put out

3ln

1929. 40%

of U. S. families

income of $2,000 or more

In .1946 66% receive $2,000 or more

were

that

for. auto-::

mobiles: "will

fade," and he ?■
urged dealers

gressive, professional -sales team
together and I would play ball

to prepare for
this situation

with

the factory

Bathrick

by maintain¬
ing
harmon¬
ious relationships with customers
and buyers.
Commenting on this
topic, Mr. Bathrick stated "that

ures.

training

any

ness.

—

(here.

shooting at
£

Somebody.
target.

else

;

your

.•»

them

And

the

yon

of*

chain

economic sequence will be broken
and we all will be broken with

By CARROLL REECE*

year. Total income in 1929 was
$83 billion. Total income this year

■

reindoctrination program if it
jc c.0und as it applies to my busi¬

and

present
seller's -mar¬

** *

specifications.

must sell

/<h

f\£. k

Democratic Party's
Red-Fascist Trend

dustry date back to magical '29.
had

will be good cars—tailored to the

public's

■

(vast

But thje sales records of every in¬

runners

honestly

If you fail—we

prosper.

"We will get
you the cars. The
:ars,will come in h flood once the

ruthlessly appraise myself and my.
organization and do what. 1 -could will be approximately $180 billion.'.
to make: itbetter.\4<W0ul&»&ttend ; "What a target for you.to shoo*
tp all the physical things such as at!. Nearly" $200
billion dollars
bui 'ding expansion and return any and- a. went up demand building
stray capital to my business. 15 up. for the last five years! : But.iusl
would, work fast-to weld an ag¬ a-miflute.- I have some-more fig¬

ket

dealer

Corporation,,
warned

endurance

"The hour is late, but if I

eral, Motors

audience

"Remember 1929? There were
two dab'In every garage then in¬

ever,

that in the business field

er,

ail, too.

perity ran through
forest fire. Late in

In an address made before, the New -York State Automobile
at Saratoga, N. Y., on July 11, D; U,
Bathrick,.
of

$70 billion.

stead of two families as we have
now. Tt was a lush year and pros¬

Dealers Association
General Sales

Manager

wa;s

This .y0ar .itis $180 billion:

.Chairman, Republican National

f§§

Committee

Republican Parly spokesman

pictures Democratic Party as eft*
by left "wing elements that parade under cloak of liberalistii*
Holds, because of this, Democrats can no longer provide an admin¬

slaved

istration

conformity witli traditional American freedom. Says
parly has dickered and dealt with men
wanting secret and dictatorial power and who bave in view
destruction of constitutional

•

"The .appliance oeonle plan

merchandising 5,900,000 refriger¬
ators. The radio people say thev
will-sell 5.100,000 sets. There will
he 5,800,000 washers made and of¬

rights and our system of government. Warns unless there is a Re*
prolan victory hi November elections, rigks of ind^
ownership and use of results of their labors will be menaced.
I

want to talk wi h you
tonight ubout a very practical and veryimportant problem. The problem is the preservation of the American
means ;that
percentage of my quota of cars
form of
government in 'the ^Urnrfced^.
-vy-7r;r;; r
for veterans. I would set as many when, full production is attained it
States.
I believe everyone will
through our instiiutofcs of free en~J
sooner or later
perhaps sooner as one car- in five aside for vet¬ will come with a rush. The pub¬
agree
with
me that is important.
than any
terprise and private property to
of us dare to think erans, not only for the value of lic will be hip-deep in products,!
On the practical
:
the seller's market will fade." their
;; :
side, the ques¬ be saved.
good will toward the future and you—as an automobile dealer
tion is, what can we do to make
I have found in recent
Continuing, Mr. Bathrick said: of my. business but also to keep —will be in the midst of the fast¬
trips to,
sure
that
our.
"And we had better be awake
system of govern¬ various parts of the nation that
est moving competitive market in
my selfrespect.
ment is not destroyed? The answer too
when it does. I don't mean that
the civilized history of man.
many of our citizens are talk-:
"These boys stepped to the front
to that is very simple and
very- ing about the Presidential eleeyou are asleep now ^ or have
."That means you must sell! sell!
for us when the chips were down.
practical.
We
can elect a Republi¬
tion^^
of 1948 ahd to few of them,
been. I think automobile dealers
sell!
I don't think it is asking a~Keli of
can Congress in November 1946. It
are thinking about the
have
done
more
to
It means that you must com¬
Congres-.
provide' Iriet
sbll > bar
will not be easy but it can and sional election
facilities for an expanding market
of 11946. Now, I ami
to those who tkme back. They're pete not only against other makec will
be done.
We have tremen¬ sure no one is more interested!
than has any other group.
The good boys and
of cars, but you must, participate
deserving of the
dous
"I

would

aside

set

definite

fered

for

sale.

That

—

dealers of

haVe

one

manufacturer alone

expanded

their

physical

properties by more than 13,000,000
square feet—an increase of 80%
their

over
so

they

ment in

And

1941

facilities.

increased

buildings 75%

never

their

1941.

all

back shop looks like and what an
important part it plays—not only
in your profit and loss position,

our
appreciation—a
fell forward for us.

immediate

your

give them.

lot of
-

them

relation¬

ships with a lot of people you will
day be begging to buy cars.
You have come to recognize the
profit-making possibility of a well
run
parts department.
And the

some

day in the not too

future, the Veteran will be
the

running

town

And they'll treat
treat them now.

live

you

then

you

in.

as you

"I would govern my

temper and
tongue in dealing with customers,
however
great the provocation,
and I would take time—at the ex¬

pense

anything

else—to

take

car

be.

vation of many

ways

mon¬

But all this has been done un¬
der pressure—pressure which has
been particularly irksome because
you could do nothing about it and
forced

by circumstances to

stand and take it.
•

"As

organizations at the very time the
seller's market has begun to fade
and you should be at the peak

form.

"By next Spring there should be
full blossoming of the competi¬

tive

market

and

find

salesmen

and

would

and

what

the

all

and

social

"In my opinion, you'll not de¬
liver more than 50% of the orders
now

your

books

because

self—and

other

aroused

fight because

alone

your

factory's future.

looking to the Republican party,

much in the last five years.
be

future is the

When you pros-

address

'Va., July 11, 1946.

obligations

cost

10 orders

is delivered to him

will fade like morning

glories at sundown.
Get Ready to

treat such

have

Sell

been

until

Election

circumstances to be construed

offer to buy,

solicitation cf

not elect

can

,^-f

Republican.

President this year because there;
is no Presidential

elect

can

election, but we.
Republican Congress
that

and

year

Senate'

well

Incidentally,

(Continued

includes

the House.

would

offering of these Debentures for sale,

or as

Prospectus.

Joseph E. Seagram & Sons, Inc.

eco¬

live

Twenty Year 214% Debentures, Due June !, 1966

with my¬

with

money

none-the-less.

employee as I would
rifling my cash regis¬

Price 99V2%

and

accrued

interest

ter.

knowledge that if ill luck befell
of

would be

through

fault

Copies of the Prospectus may be obtained from only such of
undersigned as may. legally offer these Debentures in

the

own.

compliance with the securities laws of the respective States.

Greater Sales Outlook
"

"And your rewards will be great
—for the gold is there. Make no
mistake about that.

I have tried

Harriman Ripley & Co.
Incorporated

BIytK & Co., Incv
»■*

edges

your

that

men

chairs—for
in

rich

they

this room
before

mean

are

many

going

family

clothing.
is safisfied/ bl* cait

34.800,000

United

States.

families
Todav

40,000,000 famiiies.
market.

Goldman, Sachs & Co.
*

■

....

The First Boston Corperation

Stone & Webster Securities Corporation

Glore, Forgan

Co. ^

Hayden, Stone & Co.

months

function completely unless it owns
at least one.
So—in 1940 there
were

have passed. Today the automo¬
bile is as essential to an effective
life as a. home or decent

•'

the

there

are

Tbere^: ybur

Kidder, Peabody & Co.

Merrill Lynch, Pierce, Fenner & Beane

Alex. Brown & Sons
July 18, 1946.

Drexel & Co.

Lazard Freres & Co.
Union Securities
Lee

page 369)

offer to buy, any of such Debentures.

The offer is made only by means of the

Day—No¬
'.

I found

One

preaching this
•Get Heady to SeH' sermon for a
long time now. I have tried to see
ihat:ievfery^ dealer 4-inave^contast
-with will be ready when orders
taking again becomes tough sell¬
ing. v I have tried to foster the
long view, tried to show dealers
that they should so conduct them- •
"I

months

other-

pressure

cheater

This is under

money

pressing needs. One instance to keep this talk free of
figures,
personal knowledge: an because i hate to see
people sleep¬
acquaintance told me he had or¬ ing in the daytime. But these
fig¬
ders placed with eleven dealers. ures
should have you on the
car

1946 is

cnriMmMtaMinsaB

mote

one

by Mr. Reece be¬

fore the Republican Women's Re¬
gional
Conference,
Charleston,

It is less, than four

vember 5.

this
*An

this

from my

When

But the people are
the danger and are

us- now.

"And I would see, too, that no
pmoloyee of mine ever dares to
violate a customer's trust. I-would

duplications, the delivery of an^
other automobile or the diversion
of the customer's money to

will fight to stay in busi¬
a tough type of com¬
petition if you haven't trained
ness." That is

I would be true to my ideals

because I have

i|ne it

•

lion war chest.

1948 is two years away.
with

I would say a little
prayer and I
Would be ready, confident in the

and subversive groups in
America with its boasted $6 mil¬

you and

won't

the

radical

Some of them are hungrier than

"You

corralled

election

$50,000,000

are going to be tram¬
pled in the rush. Duplication of
Ojrders is beginning to show up

now."

your

industries.

fast.
uphold

"And then when I had done
those things and done them well,

businesses

other

the

find

cannot

inconvenience—:despite.

nomic

al¬
are

dealer

moral and business

matter

can

But there

selling efforts will have to come
life before then or. a lot of

underestimate
in

which

And those times may

be coming up
"I

customer

dealer.

customer.

Wise.

result, many dealers are
frustrated., tired men with tired

your

Because

times when
a

ey.

were

don't

competition

PAC

Republican President in 1948, tout

nothing but the tfu% and I would

aggressive operation of

have worked hard and made

Everyone will be
Shooting at the' consumer's dollar.

than

would

give them the impression that I
was more sorry
about the Situa¬
tion than they were. And I would

your used
department has been the sal¬
of you. You have
learned once again the scope and
possibility of your business. You

durable goods.

opposition to overcome, not
only the- Democrat party with its
$3 million war Chest and hordes
of office holders but also ■'%he GIO-

customers into my confidence.
tell them the truth and,

iq the overall competition of the
automobile against other types of

And

"And

distant

before have dealers be¬

adept at running an over¬
operation to make an elusive
profit. You've found out what the
come so

but

can

backwards to show

ever

invest¬

over

best treatment
Let's fall

Corporation

Higginson Corporation

the
>

If ^

THE COMMERCIAL & FINANCIAL CHRONICLE

352

iy>-i:v.. Mfrm
v/vO
^, >
million loans totaling $39 billion,
the average loan being for $1,600.

flits Government
ABA official and President of Wachovia Bank and
Trust Company of Winston-Salem, N. C», says operations of Recon¬
struction Finance Corporation threaten socialization of banking.
R. M. Hanes,

taxpayer

of bank loans to business now being of¬
banks throughout the country by the Reconstruction Finance

The blanket guarantee

Corporation
merely

charac¬

was

terized

If the
banks follow this plan extensive¬

ly, it can mean that

of the socialin

banking,"

Robert

z a

tio

of.. banking.

socialization

coating'

sugar

the

coating

sugar

Stating that "We are determined
that chartered banking will
do

to establish

in this country what

is known

the postwar credit job in the same
creditable manner that it financed

aged economy,"

both the

ness

d i t

Commission of

American!

the

ciation, in

VOVVnonteu. ug

believe, will let themselves in for
another wave of criticism when

Carolina

ABA and

Mr. Hanes, found that the RFC cannot indis¬
ex-President of the criminately continue to guarantee

American

the

which

business

Bankers Association has been pro¬

......

"First, the plan encourages local
banks
their

and

merchandise

sell

credit

"The

July 12.

loans

President of Wachovia

Bank and Trust Company

cent

of Win¬

its

ston-Salem, N. C., warned that "if
banks follow this plan extensively
it can mean that eventually the

will

government
banking."

take

over

at
or

rate

% of

per

one

guarantee. Losses must follow
declining economy, and the

taxpayer

will

will find that he
the bill."

have to pay

all

less which it receives for

Mr. Hanes

pointed out that the
"There
is
now
considerable allegation that banks are not per¬
argument taking place between forming their lending functions is
Henry Wallace, Secretary of the not new and that they were sub¬
Department of Commerce, and the jected to this criticism during the
Reconstruction

Finance Corpora¬

depression of the nineteen

tion," he said, "as to which will
do the lending job for small busi¬
ness, and each will probably try to
oiitbid the other in attempting to

exploded

survey

1940, the last full year

charge of this function.
In
the RFC is offering
banks
an
automatic blanket

the meantime,

part

before

the

War,

of peace

which

guarantee

banks

participated.

The

5,000

second

phase of the pro¬

gram stimulates the relationship
between local community banks

their city

correspondents. If
the risk is
too great for the local bank, it is
encouraged to call on its city cor¬
respondent to participate with it
in making the loan.
and

loan is too large or

"The third

phase of the program

provides for the setting up of spe¬
cial

trade

area

additional

credit

sources

groups

credit.

to their trade area
credit group for assistance. A to¬

they

can

tal of 49 of these local trade area

survey

This announcement

appears as a

matter of record only and is under

circumstances to be construed

offering of these securities for sale, or as a solicitation of an offer to buy
The offering is made only by the Prospectus.

any

as an

of such securities.

July 12, 1946

New Issue

it will

Light Company

Par Value $100 Per Share

government for its credit needs,
and government will dictate how
business is to operate.
"In the past, every time the so¬
cialization of a government has
been accomplished, the first essen¬
tial step was to get control of the
financial institutions. It happened
Russia, in Germany, in Italy,
Spain. Now England, with
its socialist government, has em¬
barked on the same course by
in

and in

taking over the Bank of England
and threatening to take over the
large banks in that country.
"Here in the United States
have

following

been

this

same

pattern. We now have 36 govern¬
ment
agencies making loans to
farmers, businesses, and individ¬
uals. We must work to stop this
socialization of our financial in¬
stitutions."

Koppers Co. Makes Exch.
Offer
Underwritten by
—

Mellon Securities Corp.

Copies of the Prospectus may be obtainedfrom any of the Underwriters
only in States in which such Underwriters are qualified to act as dealers
in securities and in which the Prospectus may legally be distributed.

offering price of any of
preferred stock sold for
the underwriters during
riod
of
the exchange

the new
cash by
the pe¬
is

offer

$107.75 plus accrued dividends.
Net proceeds from the offering
of the remaining shares of new
stock will be used to redeem the

preferred stock is re¬
the option of the

new

deemable

Company on not less than 30 nor
more
than 60 days' notice, at a

sale

serial

and $8,000,000
bank notes. In addition, the
1964,

due

had

for

Hornblower & Weeks

(Incorporated)

Hayden, Miller & Co.
Reinholdt & Gardner

Cooley & Company
I. M. Simon & Co.

Starkweather & Co,
Cruttenden & Co.

A. G. Edwards and Sons

Stix & Co.

expansion

chemical

the

plant
and

related to the Com¬

the

Reserve Bank
and his duties

will

include

general

re¬

sponsibility
S.

Donald

for

research

and

statistical

Thompson

He has been director since

work.

1944 of the Urban Real Estate Fi¬

Project of the National Bu¬

nance

of Economic

reau

Research, New

York City.

For eight years previ¬
to that he was Chief of the

ous

Division of Research and Statistics
of the

Federal Deposit Insurance
Corporation at Washington, D. C.

ThomDSon

Mr.

born

was

Kansas

City, Mo., March 27, 1899.
He majored in business adminis¬
tration and foreign trade at the
University of California and re¬
ceived his B.S. degree with honors
He received his M.A. de¬

in 1923.

the same university in
specializing in economics,
cycles and measurement

1928,

business
and

statistics. His master's thesis

was

entitled, "An Index of Indus¬
Twelfth

the

Production

Federal Reserve District."
He

taught business administra¬
the University of Cali¬

tion

editor

and

chief statistician, Sil-

berling Research
Corporation,
1929; research assistant, Board of
Governors, Federal Reserve Sys¬
tem, from 1930 to 1934, and senior
research assistant, Federal Deposit
Insurance Corporation, from 1934
elevation

his

until

Division

Chief.
Mr.

Thompson is the author and

co-author of a number of articles,

mostly

nature,

statistical

which have appeared

in business

He is a

professional journals.

and

Vice-President
of
the
American
Statistical Association

former
and

member

Committee
of

nance

American

the

Association

Economic

the

and

Research

Fi¬

the National Bureau of

Economic Research.
A

veteran

the

first

World

War, he plans to move as soon as

possible from Mamaroneck, N. Y.,
to Cleveland, with his family.

Gordon Graves

Incorporates
Gordon Graves & Co.,

Street,

New

York

doing business as
Officers

are

30 Broad

City,
a

Gordon

now

corporation.
R.

Graves,

G. Moore, Vice-Presi¬

and .Budd

and Thomas J. Butler, Treasurer.

All have been with the
some

pany's present business.

time.

charge

firm for

Mr. Moore has been

for the

firm's Miami,

is engaged in Florida, office.
the manufacture and sale of crude
R. London & Co.
and refined coal tar products and
R. London & Co., Inc., will
chemicals, treated arid untreated
Koppers Co., Inc.,

the

securities

coke and gas, ma¬

gage

chine shop and

foundry products,

from offices at 135 William

piston; rings, and
of

the design; and
byproduct

coke

chemical

New York City.

ert

London,

Officers

en¬

business

forest products,

plants.

econ¬

dents; Arnold J. Steele, Secretary,

plants, coke ovens, and

vSiifc

omist

credit not to exceed

bank

construction
U

general

recently announced that
completed arrangements

other fields

Incorporated

will act as

son

President; Robert B. Stringfellow

$10,000,000 to be used for

Salomon Bros. & Hutzler

■

Mr. Thomp¬

fornia during
1922-23; was re¬
exchanging those shares for search
assistant, statistician and
cumulative preferred stocky assistant
manager of the Division
4% Series. The exchange offer,
of
Analysis and Research, Fed¬
open until 3 P.M., EDST, July 24,
eral Reserve Bank of San Fran¬
1946, is on a share-for-share basis.
cisco, from 1923 to 1929; associate
Shares of the new stock not ex¬

bonds,

Glore, Forgan & Co.

Dean Witter & Co.

nounced.

new

Stern Brothers & Co.

Presi¬
Ray M.
Gidney an¬
1946,

dent

company

Central Republic Company

join the
bank Aug. 16,

trial

Koppers Co., Inc., is offering to
the holders of its presently out¬

and

will

gree

completion of the exchange,
of unexchanged shares
and the redemption of the present
preferred stock, the outstanding
capital stock of Koppers Co., Inc.,
will consist of the 150,000 shares
of new preferred stock and 915,550 shares of common stock. Cap¬
italization of the company
in¬
cludes funded debt consisting of
$23,000,000
3%
first mortgage

Price $104 per share

Alex. Brown & Sons

rectors

plus accrued dividend from July 1, 1946

Moseley & Co.

Reserve Bank of Cleveland by the
Board of Di¬

business, for bus¬
iness will then have to go to the

the

F. S.

Thompson has been appointed
Vice-President of the Federal

that government will

mean

graduated scale of prices begin¬
ning at $111.00 a share.

3.90% Cumulative Preferred Stock

Drexel & Co.

CLEVELAND, OHIO — Donald
S.

also control all

The

Coffin & Burr

Of Cleveland Reserve

government

unexchanged shares of the pres
ent preferred stock at $107.50
share plus accrued dividend t
date of redemption.

40,000 Shares

Missouri Power &

Thompson V. P.

or man¬

credit groups have been organized
throughout* the
country
and
to 75% of the amount showed, he said, thrit these 5,000
through them $675 million has
of loans made to business. This banks, approximately one-third of been made available to take care changed will be purchased for re¬
sale by Mellon Securities Corp.
blanket guarantee arrangement is all the nation's banks, made 24 of credit needs in addition to the
and associated underwriters. The

w...y-VJrV,- •A-v*'.7

Mr. Hanes con¬

thir¬ the local bank and the city cor¬
cumulative
preferred
respondent feel that the credit is standing
stock, 4%% Series, the privilege
more than they wish to undertake,

made

{•; ev .<.

government

controlled

"This means

tinued.

the

He told how this charge was

ties.

take

Donald

operation
of
banks,
insurance
companies, and other financial in¬
credit plan for stitutions. If this is
brought about,

services," he con¬
address to 200
Harris & Ewirs
tinued.
"It acquaints them with
Robert M. Hanes
bankers from
our
economy ceases
its upward new types of credit services and
North and
movement and starts on the down¬ suggests ways in which banks can
South Carolina attending the an¬
ward
trend
again," he stated. increase their loan volume and
nual Carolina Bankers Study Con¬
"When that happens, it will be thus enhance their income.
ference at the University of North
who

certain leaders

government and business

eventually the
moting
take over all

could
otherwise," Mr. Hanes
acknowledged.
"Such bankers, I

Bankers Asso¬

demand

insistent

k v •

/;*"A,

during the War," Mr. Hanes told
about the postwar

...

Small Busi¬

time there has been

some

among the banks for the
government will
past two years.
banking.
'
"For "the past two years," he
"We regret that we do have some
riskless bankers who would avoid said, "the American Bankers As¬
has devised and
pro¬
their responsibility of taking ord¬ sociation
inary business risks and some moted a plan whereby the banks
supplement their
lending
who might wish to make more may
profit by carrying a larger loan capacity without the necessity of
with such guarantee than they government guarantee of loans.

Hanes, Chairm a n
of
the

"For

country and were taking care of
a big way."

declining economy, RFC

fered to

their city correspondents.

"We are determined that chaircomparison with this tre¬
mendous total, all the;: lending of. terpd banking will do the postwar
credit;
job in the same creditable
all the governirient agencies paled
into insignificance," he said. "The mariner as ft financed both the
critics found that the banks were government and business during
the War," he declared. v
.,
meeting the credit needs of the
small business in

will undergo losses, "and die
will find he will have to pay the bill."

Warns in

facilities pf the local banks and

"In

Guarantee ot Loans
■

Thursday, July 18, 1946
•

Street,

are

President;

Rob¬

Sol

Karp, Vice-President, and Evelyn
Eichhorn, Secretary-Treasurer.

k'* i*

I.. $ M OM M'MOS, JSf

•.

Volume

Number 4508

164

THE COMMERCIAL & FINANCIAL CHRONICLE

"Iron

at the old OPA

the

matter

steel

before

price in-^

northern

ducers.

Because

yet

pig
of

iron

increase

the

posite price for pig iron has ad¬

most steel firms have their

southern

vanced

cocked
in

towards

the

price debate

upped his price
but the latter advance

ton,

Correspondent holds

return of free market for metal under prevail¬
ing conditions would, by permitting higher prices, lead to
opening
up lower grade mines.

in the South "The Iron Age" com¬

ducer has raised the price of pig
iron
$3
a
ton, while
another

maker

Rise to $100 per Ounce

pro¬

creases, according to a release of
'The Iron Age," on July 10. While
ears

Sees Possible Gold Price

ceiling price and

price action has been taken

Tightness in the supply of scrap, pig iron and coke, basic prod¬
ucts in steelmaking, has
temporarily blocked any sustained thinking
on

OPA

Still another iron pro¬
continues to sell pig iron

ducer

out of price * structure without
general across-the-board advances.

June 30.

Age" looks for straightemng

OPA, but

approved

was

Reports tto Abrupt Rises in Steel Prices

this

week

from

ton to $26.45

gross

$26.12

Editor, Commercial & Financial Chronicle:

ton.

The importance of gold increases as the world
picture unfolds.
Countries ruined by debt which their tax
structures cannot support,

Congress and their eyes glued
news dispatches
looking for the

trend- which

the

question will

tically

price

take, there is

chance

steel price

changes in the imme¬

diate future.

When the

becomes

air is

cleared

definite

and

whether

many steel products are not carry¬
ing their economic responsibili¬

other

gold

speaks

hand

and, at same time, the
pound would be reduced
of

terms

14.50.

from

16.92

The

not

i forts

krona

action, it is reported,
directed especially against

currency, but is due to efby the Swedish government

to halt domestic

price rises which
almost certain
that
no
general
are causing a demand for higher
across-the-board advance in steel
prices will be made until the lat¬ I wages. It is, in a way, an indica| tion of the depreciation of the
ter part of this
:

if the entire

year

price
controls
eliminated.

are

permanently

dollar and

that

The steel industry and the
scrap
industry through their respective

have

institutes engaged this week in a
mild debate as to who was re¬

value

sponsible
of

for

scrap.

American
official

The

present dearth
accusation by an

Iron

that

dealers

Institute

brokers

some

and

holding back

were

because

Steel

scrap

higher prices might

be effective

was

answered

soon

by the

Institute

of Scrap Iron & Steel
which pointed out that the lack of
small dealers who were a war¬

time casualty and the unrealistic
attitude of the OPA in
handling
the scrap situation

coupled with

strikes

steel

consumer

plants

were
the major reasons for the
present situation.
This public argument between
the two groups is not a new

since the
the

same

place

general exchanges

several

times

during

Steel

war.

producers have
been insisting that new contracts
on scrap should be written
at the

its

closely

gold

basis, or
which will

the

Following
raising of the
parity with
States
the
dollar,
the

dollar

United

Swedish

rise in

currency.

Canadian

action

has

rela¬

some

tried

fix

the

currency

exchange value of its
in terms of other na¬

tionalities.
has taken

Switzerland

yet,

action to revalue its

monetary unit, but it is expected

that
cash

According

Heidenstam,

condemned

von

the

State Bank's decision and forecast

that the consequences will be
for Swedish

vere

exporters, however,

rying,
areas
as

not

are

South

America,

Southern

and

Eastern

Lewis Wheelock Dead

Des

Moines, Iowa, died of

ailment
Mr.

his

Wheelock

home

had

been

heart

July

inactive

ered

ill health.

gold

value,

holdings

due
gold

to
in

the
that

country.
The

rise

the Swedish krona

value in relation to the dollar and

port, la., and opened in business

for himself in 1920 in Des Moines.

Sterling

disturbed

the

export

the

past should
the. importance

and silver furnished

pre¬

stock

over

Martin

Judge,

Jr.

lode

saved

contracts

retroactive

should

feature.

carry

The

■

amount

of scrap being held back because
of the price confusion is

probably

not

large share of the total

very

scrap movement.
Many brokers
while not obtaining a retroactive

clause

from

steelmakers

nevertheless

suppliers,
such

agreed

the

black

market

con¬

arguments
situation

than

producing

One

States

cannot

are

materials

see

our

own

government

are

enmeshed in

billions of debt

hundreds

as our

MARTIN
145 Sutter

San

Street,

Francisco, Calif.,

Sutro Bros. & Co. To
Admit To
Sutro

Partnership

Bros.

Co., 120 Broad¬
City, members of
Stock Exchange
other leading exchanges^', will

war

way, New York
the New York

(gold and silver) can furnish an
approach to bolster this weakened

and

structure.

This

and

the

over

This advertisement is not, and is under

admit

Walter

full

circumstances

or as a

100,000 Shares

supply

decade

oration

were

used up in the war effort;
second,

manufacturing concernings which
furnish scrap as a byproduct haVe
not

attained

full

(formerly SPICER MANUFACTURING CORPORATION)

reconversion

production levels; third, thousands
of small dealers known

as
"scrap"junkies" have left the
scrap collection business for bet¬
ter paying jobs; fourth, war sup¬
plies sent abroad represented a

pies"

Cumulative Preference Stock

definite loss in

fifth,

the

return

confusion

3% % Series A

($100 Par Value)

and

scrap;

surrounding

free markets which have not ex¬
isted for several years is no dif¬
ferent in the scrap and steel trades

Price

than it is in other industries.

$102 Per Share

Despite
and

the shortage of scrap
temporary labor diffi¬
the steel industry this

some

culties,
week

rated

Copies of the Prospectus may be obtained in any State only from such dealers partici¬
pating in this issue as may legally offer this Stock under the securities laws of such State.

was
operating at 88.5% of
capacity, up V2 point from

last

week's

The

revision

revised

rate

88%.

in last week's
rate,
originally estimated at
189% of capacity, was occasioned

which

|by

was

Merrill

a strike in the Buffalo district
substantially reduced op¬

^ which

erations there.

Since OPA

fone

was

increase

curred

Jdustry.

the

eliminated only
prices has oc¬

iron

and

steel

A southern pig iron

in-

pro¬

Floersheimer,

produc¬ member of the Exchange, to part¬
of all our underground re¬
nership on August 1st. May Sutro
sources offers the only chance to
Rothschild and Hermann Merkin
ride the storm we have created. will be
admitted to limited part¬
Iron, oil and gas, copper, lead, nership on July 29th.
*
tion

he construed as, an
offering of this Stock for sale, or
solicitation of an offer to buy, any of such Stock. The offering is made only by the Pro¬
spectus; the Prospectus does not constitute an offer by any dealer to sell this Stock in any State to
any person to whom it is unlawful for such dealer to make such
offer in such State.

offer to buy,

scrap accumu¬

past

JUDGE, JR. I

July 12, 1946.

heritage of

and folly.
Increased national
wealth represented by hard money

World could be realized.
%It
be
born
with fluttering

Lauterwasser & Co.,

surface

scrap

gold

bank¬

paper,

the facts that: First,

are

large reservoirs of
lated

these

the

over

near

on all continents .to a
production
point where perhaps the dream of

their

dealers, to

basic

far

the

clause.

the

com¬

ruptcy of the nation.

have

with

waken

by the Corii-

the

old OPA ceiling price while
many
scrap brokers have insisted that
new

clear view of

mands
full
value
to
the
reaches of the earth.
After
Civil War, the $600,000,000 in

mines
of the
dormant, labor
strangling resump¬
tion of operations.
Canada will
be hard put, under the parity rul¬
ing, to maintain production at its
high-Cost properties.

He entered the investment busi¬

ness in Iowa in 1919 with the
George M. Bechtel Co., of Daven¬

today and all the his¬

only medium of barter .hat

far

continuing lavish expenditures, in
foreign loans,
veteran benefits,
continued bureaus, so that today

Cummins, Inc., of

Under the
prevailing conditions
prices of the leading nations. The in all
countries a free market for
adjustment cannot be far away as
gold might carry the price to over
the issue is forced into the open
$100 an ounce.
The effect would
and a free market would be de¬
be to open the lower-grade mines

Lewis F. Wheelock, of the firm

in the firm since 1938 because of

mium

and
Eu¬

basis

the established

United

rope.

of Wheelock &

heavy

The

well

tinues to grow.

that the Swiss franc will be low¬

heavy

gold

sirable

wor¬

they have vast market

se¬

exporters. Many

world

tory

away place in
the
universe,

dis¬

Baron

the

them
terms

dollars

to the New York "Times,"
the chairman of the Swedish ex¬

organization,

the

are

things apart, but

posses¬

patch

porters'

and

sion.

wireless

universal

sired

their

products

our- na Jonal
economy.
The poli¬
ticians and pseudo statesmen seem
to regard gold and silver as a
„

Swedish
have

country.
reported

are

earth

is the most de¬

dollars, and
Swedish
banks
were
compelled
to buy $17,000,000 in a few weeks.

tionship to the plan under the In¬
ternational
Monetary
Fund,
whereby each member nation is

story

took

adhere

other countries

export markets
not be affected by a
so

the

Sterling, and is likely

to be followed in

exporters

zinc, bauxite all find their way
into productive
industry and these

The

langauge

krona which stood at 4.20

trade

air.

the

July 13, the "Riksbank," central bank of SWeden, announced

dollar,
in

out the unbal¬
anced price structure under which

the

rate..

British

straightening

over,

begin to take serious action

ties.

world

that the exchange value of the Swedish
would have a value of 3.60 to the®

whether the OPA will have a
decent burial,
then steel firms

will

thin

dis¬

appearing into

National Bank lowers the value of the krona from 4.20 to 3.60 to
the dollar. Similar action taken with reference to Sterling-krona

OPA

price controls will be resurrected

cur¬

rencies

prac¬

major

any

their

see

Sweden Lowers Value of Dollar and Pound

control

353

July 17, 1946

Lynch, Pierce, Fenner & Beane

FINANCIAL CHRONICLE

THE COMMERCIAL &

354

Thursday, July 18, 1946

*»■)"" HI!

rected by the mere process of re¬

vision of the capital structure.
One of the most unfortunate

pects

the

Chicago

as¬

Nort

Broadensilcftivilies

Western is

its heavy, labor cos
generally characteristic
of low density mileage, particuf
larly when aggravated by a short
average haul. In relations to grosfc
Chicago & North Western has
consistently shown the highest
wage bill among the major Class I

which

; Chicago & North Western equities, have been among, the poorest
t&ting in the rail group in recent weeks.- At last week's low the comf
mon was off 14% points (just a third) from- the 1946 high and more
than 20 points below the peak reached in 1945. As a matter , of fact,
the stock last week sold within a fraction of where it was selling
when first admitted to trading on a when-issued basis on the New
York Stock Exchange in Febru-Q——
*
■—
t
ary 1944.
In passing it is inter¬ revenues declined" ies5 than 10%.
esting to note that when the stock However, the road's transportat¬
was

jand

initially listed not quite two
half years ago the common

stock of Southern Pacific

was

sell¬

ion

ratio

50%

soared

mark

the

and

ratio also climbed

the

maintenance

appreciably. As

the same general price
Southern Pacific common
is now selling at more than twice
the price of the North Western
common
and
even
appreciably

result, the road reported a net
operating deficit of $831,927 in
sharp contrast to net operating in¬
come of $9,059,331 realized in the

Western

since 1940 has North Western re¬

ing

range.

higher than
preferred.
;

the North

first

five

ported

North Western's

earnings

far

this

year have made very sorry
reading.
For the five months
through May traffic held up fairly
well. Car loadings were off only

5.7% from

a year ago.

Even gross

months

1945.

Not

operating deficit- in

net

the first five months of the year
and even in that year the deficit

for

the

than
the

outlook

for

the

over

company's

have

on a

been pointing out
pro-forma basis earnings

of North Western for the full year
1940 were not sufficient even to

Alabama Mills

cover

the full income bond inter¬

est.

Arden Farms
Common & Preferred

far

back

1941

of every

story of labor costs

does

include

not

constitute

the

North

total

1941

Western

absorbed

52.1

This is just about six cents higher
the average for all Class I

the

conditions
and

under the con¬
favorable traffic

year

highly

North

Western's

nation,
Paul G. Hoffman,
Chairman, reported. Commenting

the

North
and

impact of successive

Western

traffic

with

mittee

and

the

and

state

com¬

munity chairmen he said:
"CED is

picture,

tensified

during

the

With

return

tions

general

under

railroad

erations
a

its. location

op¬

the

tempororay

creases

freight

instituted

on-

cost North

year may

in¬

rate

July 1. It is

$15,000,000

years.

1946.

nearly

even

railroad

condi¬

volume if the rate increases will

has

repeatedly

the

get relatively little benefits from

war

the weakness has

was

begun to

been

pointed

number

comparison, it is doubtful

with

bring in

well sustained freight

much

this basis rail

that

there will

$3,000,000/On

men

are

analysts

territorial
are

cor-

year

for

any-,
r

thing, in the

not

estimating

little,

even

'* *■

of earnings tf'

way

in¬

major

nation's

the

on,

economic

the preferred shares.

"Business
in

lead

the

should take the

men

development of such

policies.
To assume this leader¬
ship they should have a better
understanding of the problems
which in the past have caused the
boom and bust cycles from which
this country has suffered acutely
for many decades. The state chair¬
men
will appoint as community
chairmen those business

men

who

by their as¬
sociates of the findings of our
Research
and
national
Policy
which

Committee

Ralph

Flanders, Consultant to the Fed¬
eral Reserve Board of Boston, is

Railroad Bonds and Stocks

Broadway, New York 5, N. Y.

Chairman.''
Mr. Hoffman said plans are

231 So. LaSalle St., Chicago 4, 111.

being

developed to permit business men
others

and

members of
and

Specialists in

that

Members

New

York Stock

New York 6

Telephone—DIgby 4-4933

Bell

associate

various

community
announce
these

will

Members of the

Exchange

Broadway

become

subscribers to CED

plans locally.
Committee

to
or

the

chairmen

PFLUGFELDER, BAMPT0N & RUST
Teletype—NY 1-310

new

Information

are:

Aspley.

President, McGraw-Hill Publish
CUARANTEEP

RAILROAD STOCKS-BONDS

29 Broad Street

New York 4, N. Y.

Telephone BOwling Green 9-6400
Teletype NY 1-1063

Seaboard Air Line Railway

Chicago; Russell G. Creviston, di¬
rector

When

Chicago.

losses

assumed

public relations, Crane Co.,

Also, Alvin E. Dodd, President,
Management: Ass'n,

York; Curtis H. Gager, VicePresident, General Foods, Corp.,
New York; Dudley Harmon, Ex¬
ecutive Vice-President, The New

New

Common

SUTRO BROS. & CO
Members New York Stock Exchange
120

3%%
of

stock

issue

Beatrice

Co., 55,911 shares, or 93x/3%, have
been taken in exchange by hold¬
ers of an equal number of shares
of the old $4.25 preferred stock.
The balance of 3,951 unexchanged
shares of the new preferred have
been
sold
to
an
underwriting
group headed by Glore, Forgan &
Co.
The exchange offer expired
the

business
of

1946.

The

ferred

stock

request

remaining outstand¬

Aug. 15, 1946.
Upon completion of this financ¬
ing the company's capitalization
will consist solely of
this new
issue of convertible preferred and

750,000 shares of $25-par com¬
mon
stock,
of
which
511,792
shares are now outstanding.
The company,

whose predeces¬
1898, is one of
distributors of
dairy
products, specialty foods
and frozen foods. Manufacturing
sor

dates back

the nation's largest

plants,

cold

plants

storage

bia,

are

•

Robinson & Co. To
Admit H. L. Harris
CHICAGO, ILL.
Co.,

South

231

members

the

—

Robinson &

Salle Street,
York

New

mit Henry

L. Harris, member of

nership
has

of July 18.

Mr. Harris
on

the

floor of the New York Stock

Ex¬

been

doing business

Mclaughlin, reuss & co.
Members New York Stock Exchange

BROKERAGE SERVICE

Specializing in Railroad Securities

Adams&Peck
63 Wall

Boston

ONE WALL STREET

Street, New York S
Tele. NY 1-724

'.Ovp.

Philadelphia

Hartford

1. h. rothchild &

TEL. HANOVER 2-1355

co.

Member of National Association

52 wall street

of Securities Dealers, Inc.

HAnover 2-9072

and

the New York Exchange to part¬

Heimann,

BOND

BOwling Green 9-8120

and

operated in 23
states and the, District of Colum¬
offices

Common Stock

per

pre¬

ing will be called for redemption

Credit Men, New

Island Airlines, Inc.

Price: $3.00

July

$4.25

Common

Circulars

pre¬

Foods

Council, Boston; Henry
change as an individual floor bro¬
National Ass'n of
ker.
In the past he was with
York; Arthur A.
;
Hood, Director of Dealer Relations, Goldman* Sachs & Co.

CENTRAL PAPER

TEXTILES, INC.

59,862

convertible

England

BROADWAY, NEW YORK 5, N. Y.
Telephone BEctor 2-7340

new

Chicago Stock Exchanges, will ad¬

American

KENDALL CO.

the

ferred

ing Co., New York; J. M. Cleary,
Roche, Williams & Cleary, Inc

When issued profits discounted
issued

sales

President, The
Dartnell Corp., Chicago; G. Irving
Bailey, Central Council qf Na
tional Retail Ass'ns, Washington;
Col. Willard T. Chevalier,, Vice
J.

Selected Situations at all Times

of Newark, Newark; Arthur H.
Motley, President and Publisher,
Parade Publications, New York;
G. A. Renard, Executive Secretary
and Treasurer, National Ass'n of
Purchasing Agents, New York;
and C. A. Sienkiewicz, President,
Federal Reserve Bank of Phila¬

delphia.

engaged in

now

program

will encourage study

and other
leading Security and Commodity Exchs.

Co.,

responsible
research, designed to throw light-

composition stands to

Exchange

SECURITIES

done

ment.

obvious

incident

reappear.

RAILROAD

by the national Information Com¬

percentage wage boosts must be.
On the other side of the

work which will

the

higher the basic wage bill is the

Rubber

the

It is quite obvious that the

gross.

Walter D. Fuller

throu g hout

payroll tax burden amounted

Business Librarian, Public Libra¬

community

to 48.7 cents out of each dollar of

Tire

Union, New York; John W. McPherrin, Editor, American Drug¬
gist, New York; Marian C. Mariley,

ap¬

chairmen

wage

Also, David
Magowan, ViedPresident, Western Newspaper

CED state and

Even last

tinuing

Akron.

ap¬

pointment

roads.

MEMBERS

for

President,
Foundation*

Van

and

Firestone

plan

Newj

Johnson,

Safety

Ledere
Wormer, NeW
York; T. G. MacGowan, Managed*
Marketing Research Department,
Morris

trus¬

also

proved

than

•Ernst&Co.
•

tees

Pyke

Washington;

Western

weakness

operating weaknesses

120

the

Pub¬

the

-—-

Automotive

At the meet¬

ing

•

York;

chairman.

cents out of every revenue dollar.

Stock

Presi¬
of '

•

Johns-Manville Sales Corp.,

lishing Co. of
Philadelphia

bill

wage

^—•

—

granted this

railroad

York

dent

direct labor cost, are

the

with

Curtis

important
item of payroll taxes.
If these
payroll
taxes,
Which
certainly
included

Com-

mittee,

Fuller,

mation

Walter

dollar of North Western's

Even this does not tell the

gross.
whole

Trustees of the Committee for Economic Development, meeting
here on July 12, approved the
appointment of a national CED Infor¬

tortions

out

New

Chairmanship of Walter D. Fuller.

heavy traffic conditions and dis¬

normal

under

This

less

normal

Cement

boom-vj

community lines fo avoid

national information committee under V

indicated that the wage increases

operations

Missouri Portland

carriers.

state and

Initiates

problems.
By such research we
hope to suggest solutions for those
problems which will assure the
maintenance of high levels of pro¬
duction, distribution and employ¬

conditions.

Dearborn

Western

traditionally a low density prop¬
erty and also has about the short¬
est average haul of freight of any
major carrier in the country. Axiomatically this makes for expen¬
sive

Consolidated

North

arid-bust cycles.

wages allocated to operating costs
absorbed more than 49 cents out

greater

Chicago

Expanding researck on

less

was

$100,000..

equities
that

held to
Pessimists

period

f. c.

Tele. NY 1-1293

Philadelphia Telephone

NEW YORK S
TELETYPE NY 1-2155

Lombard 90.08

[Volume 164

THE COMMERCIAL & FINANCIAL' CHRONICLE

Number 4508

J - Juiie Insurance Sales 53% Above Year Ago
Increase Is

in All

Types, Including Ordinary,

Life insurance purchased in the United States in June showed

increase of 53% over purchases in the corresponding

month of last
and were nearly twice the $>•
aggregate reported for June in group insurance contracts already
in force.
prewar 1941, it was reported to¬
In the first six months of the
day by the Life Insurance Agency
Management Association of Hart¬ year total life insurance purchases
ford, Conn.
Total purchases in were $10,475,563,000, an increase
June were $1,863,485,000,, com¬ of 47% over the first six months
pared with $1,216,264,000 in June of 1945 and 90% over the corre¬
of last year and $947,027,000 in sponding
period of 1941.
Pur¬
•Tune, 1941. ;
chases of ordinary life insurance
accounted
for
$7,759,824,000 of the
H; Purchases of ordinary life in¬
surance in June were $1,340,743,sijx months' aggregate, an increase
OOp, up 63% over June a year ago of 59% over last year, and .well
year

and

well

twice

over

June, 1941.

the total

industrial -life insurance pur¬
chased in June amounted to $338,$99,000, an increase of 31% over
<!

the

corresponding month last year
and 24% over June, 1941.
</
Group life insurance purchases
were $183,743,000 in June, an in¬
of 35%

crease

June

over

year

,ag;o but two and one-third times
the figure for June, 1941.
These

purchases
set

represent

new

groups

and do not include

tions of insured personnel

addi¬

under

June

double the 1941 total.

over

Indus¬

$719,635,000.
an
increase of 16% as compared
with the first six months of last
chases

amounted

year.

Monthly purchases of life insur¬
ance
for June and the first six
months in each of the last three
years were

ciation

reported by the Asso¬

follows:

270,719

Group

172,850

Total

$1,215,401

1946 Over 1945

1946

$1,340,743
338,999
183.743

35%

$1,216,264

$1,863,485

53%

31%

1945

1946 Over 1945

1946

(000 Omitted)
Industrial

Total

shares of

59%

$4,237,094
1,656,555
860,226

$4,883,744
1,620,668
620,637

$7,759,824
1,996,104
719,635

23%

$6,753,875

$7,125,049 $10,475,563

47%

16%

Advanced

July 11 from 15 cents

plates
It

some

increase at end of

announced

was

magazine that the price on
at newsstands

purchased
be

year.

cents, instead of 15 cents,
was taken reluctantly,

The action

the announcement states, but was

because of

greatly in¬
During the war
years, the periodical elung to its
original price of 15 cents. Yearly
subscriptions which were held at
$5, will now be raised to $6.50.
necessary

costs.

creased

Another

week",

news

which

cents per copy,

weekly, "News¬
also sells for 15

is reported to have

contemplation

crease

when

year

annual

the

Reeves

are

after

count

retain

shares of
Reeves

ganized

from 10 to 15 cents.

An underwriting group headed
jointly by Lehman Brothers and

Commercial

Investment

Trust

from

ten

textiles

marks

the

and

first

the

offering

public

distribu-

t tion of its shares.

| V

Of the offering 328,819 shares
are

being sold for the account of

group of selling stockholders. Prorceeds from the sale of the remain-

ing
the

■

.55,000 shares together with
proceeds from an additional

15,000 shares which the

company

is offering for purchase to certain

;

[ officers and employees will ini•

tially become part of. its general

Ji funds. It is. anticipated, according

cloth.

special

manufacture

wear,

weather

wear,

and

Byrd

six

bined with other strikes.'

months
than

1946.

73%

"General

Output

was

behind schedule.

Motors

Corp.
an¬
nounced July 10 that production
was still hampered by 58 separate
and

distinct

fecting

supplier strikes af¬
production in nearly all

divisions. In the highly integrated
automobile
manufacturing busi¬

rod

mills

about

40%

"Steel

production

than

capacity.
this

field

40%

has

behind

most

21%

least

But

free.

our

caught in

born government

work

in¬

Assumed

from

adjustments

could and would be

made, management was forced to
reject union demands and shut
down

production at a time when
production is the only means of
preventing

Paul R. Soule Joins

lagged

Staff of A. R.

Company,

120

South

clothing,

tives for the

Lord-Abbett

Investing Companies.

Corporation

Company

shirting and dress

airplane

cloth.

brand

The

names

Cloth, Reeves

Mountain

Cloth,

The extension

of the Bonds and the guaranty by The Delaware and Hudson Company
of the Extended Bonds have been authorized by the Interstate Commerce
Commission by order made March 5y 1946.

un¬

in¬

Army

Price IOO%%

Warrior

and accrued interest

The Offering Circular may.be obtained in any State in which this announcement is circulatedfrom
only the undersigned: and such other dealers as may lawfully offer these securities in such State•

King Broadcloth.

HALSEY, STUART & CO. Inc.

Gerard Smith in New York
Gerard S. Smith is engaging in

securities

City.

Wall

the

business

from

of¬

Street, New York
past

Jenks, Gwynne & Co.

was
-

2%%

The Delaware and Hudson

with
;^

The Extended Bonds

are

offered subject to prior sale and to

withdrawal, cancellation or modification of the offer
Halsey, Stuart & Co. Inc.,

without notice. Extended Bonds in.temporary form are available for delivery at the office of
35 Wall Street, New York 5, N. Y.

July 17. 1946.

Salle

Group

He will

be active in wholesale work.

Guaranteed as to principal and interest by

foul

Twill, Air Wing Fabrics and Pima

the

Street, middle-western representa¬
of

1945

Hughes

CHICAGO, ILL.—Paul R. Soule,
recently
discharged
from
the
Navy with
rank
of lieutenant
commander, has joined the or¬
ganization of A. R. Hughes and

The Delaware and Hudson Railroad

Twill, Reeveking Gabardine, Ma¬

fices at

inflation."

runaway

in the

and

had ;
vise %

controls, unable
price

Mortgage Bonds—Due by Extension April 1,1971

sale

to find out in advance what

(Total principal amount underwritten for extension, of which $9,934,000, aggregate principal
have been extended. Of such Extended Bonds,$4,087,000, aggregate principal amount,
are offered by the Offering Circular.)

been

between wage demands and stub¬

an offer to sell or a solicitation of an offer to buy these securities»
offering is made only by the Offering Circular.

Interest

com¬

economy

amount,

First

three

have

could

been

practical

behind

them

Inventories throughout
were
reduced to the

was

prevented

vanishing point during June.
"Coal

by the coal strike,

"The tragedy of all these pro¬
duction losses lies in the fact that

capacity.
more

back

set

months

15%
of
capacity,
copper
wire
mills to 25% of capacity, and cop¬
per

o-f

goods, including automobiles, has
been

The

rine Herringbone, Glengarrie Pop¬

lin,

had

of the

Products

rain

advertised

clude

Association,

industry

failed by 2,425,000 cars and trucks
to reach its schedule for the first

verti¬

products of the company sold
der

the

scars

great many
months to come.' The report addled
that 'the production of durable
a

or¬

fabrics made

sports

goods

that

would 'bear the

coal strike for

The company and

better quality cotton, used

Inc., on July 16 offered to the
public 383,819 shares of Reeves
Brothers, Inc. common stock at
$26.50 per share. The company is
a prominent manufacturer of cot-

founded

was

production and

finished

the

economy

successor

the purchase

the

production, and the most recenti
ife CiyiMah Brod^

This announcement is not

integrated
cotton
textile
business, the operations of which

*173,610

Administration said the American

showed

Mrs.

years.

2,425,000
14,597,219
*62,885,000
*196,21®

"Figures released by George W.
Romney, President of the Auto¬

partnership in the firm.

cally

extend

$26% a Sit,

Inc.
the

its subsidiaries constitute

clude

Offered at

1922

business

fiber

Reeves Bros. Inc. Com.

several

for

Loss* ><'.

918,000

history, has been hardest hit by
the
strikes," Mr.
Wason
said.

mobile Manufacturers

George-

firm

21,705,341
*234*540,000

report of

Wall Street, New

Production

stock.

Brothers,

zine, which is published under the
auspices as "Time," has also
recently advanced its selling price

V'The automobile industry, faced
the greatest market of its

July

He has been with the

Production

with

ness, even one supplier strike can
have a crippling effect on pro¬
1, 1956 to be
duction.
secured by a pledge of $3,600,000
"The tabulations
showed that
North Western Refrigerator Line
Co. equipment trust certificates; production of refined copper, upon
which the entire electrical
in¬
36,000 shares of $2 cumulative
convertible preferred stock, with dustry is dependent, was 52% be¬
a
stated value of $50 per share, hind 1945. The monthly report of
and $150,381 common shares, $20 the Civilian Production Adminis¬
tration for April said brass mill
par value.
production had been reduced to

Co.,

.-■

Actual 1946

36*302,560 '"
*"297;425,000 S
*374,826

serial notes, due Oct.

York City.

v*■'

*Tor.a,

Upon completion of this financ¬
ing, outstanding capitalization will
consist of $2,812,5O0of 2J/2% serial

to partnership in

The5 principal

shares will
the company
than 550,000

Reeves in 1919.

same

common

interests
their ac¬

for

sale

will be at the rate of $6.50 instead

(6 mos.)
ingots-(5 mos., 1945)
Soft Coal (6 mos.,< 1945)-.—Refined copper (5 mos., 1945)Steel

working capital.
The company, including its new
subsidiary, is primarily engaged
in the business of operating and
leasing tank arid refrigerator cars
on a rental and mileage basis.
On
June 1, 1946, the company and its
new subsidiary operated a fleet of
10,666 cars, of which 4,614 were
tank cars and 6,052 refrigerator

Practical Capacity
; 3,343,000

Cars and trucks

for additional

negotia¬

pre-strike

still in progress."

328,819

of $5 as at present. "Life"

maga¬

family

holdings

amounting

in¬

subscriptions

the

current

similar

the end of

to the prospectus, that such net
proceeds will be used, together
with other funds, for the purchase
of new machinery and equipment
at an estimated cost of approxi¬
mately $2/200,000.
The group of selling stockhold¬
who

of the

sale

certain equipment trust cer¬
tificates originally issued by North
Western Refrigeration Lines and

from

ers

the

Dorothy V. Seitz has withdrawn

July 11 by "Time," the weekly news
July 15 and thereafter of a single copy
would^—

of goods has

were

acquisition of North Western Re¬
Line Co., redemption

1946

tions

Anticipated

serial notes, will be used for the

son

Yearly sub¬

newsstands.

in¬

Production

Edward A. Crocco has been ad¬

scription raised from $5.00 to to $6.50. "Newsweek" also contem¬

production

while

Georgeson Admits Crocco

Magazine Now 20c

regard

338)

page

prices

194$ production
helped to hamstring business, but losses tabulated by NAM pur¬
OPA could have averted much of
posely:
omit
the
reconversion
the mischief by telling business¬ losses of last
year, and are as
men; how much
<
they could raise follows:

preferred shares, together with
the proceeds from $3,600,000 of

mitted

"Time"

without

for each share

common

of preferred.
Proceeds from

Increase

Group

creased

headed-by Glore,
Forgan & Co.
The preferred
shares are priced at $51.50 per
share plus accrued dividends, and
are initially convertible
into IV2
group

Co. 2%-3%

First Six Months' Purchases

Ordinary

writing

hour

per

notes due 1946 to 1953; $3,600,000
North Western Refrigerator Line

63%

$821,029
258,971
13*3,264

1944

raising wages at least 18% cents

cars.

(000 Omitted)
Industrial

(Continued from

preferred stock
value)
of North
American Car Corp. by an under¬
par

increase of
23% as compared with last year,
while group life insurance pur¬
year's total,

1945

$771,832

convertible

(without

resented $1,996,104,000 of the. cur¬

Increase

Ordinary

tive

Lays Production

Losses To OPA

Public offering was made July
of 36,000 shares of $2 cumula¬

frigerator

Purchases

1944

trial life insurance purchases rep¬
rent

NAM

North Amer. Gar Slock

Industrial and Group

Glore, Forgan Place

355

J'/:

356

THE COMMERCIAL & FINANCIAL CHRONICLE

not flexible enoiigh; wlih respect
(Continued from page 335)
one anotner in
getting this to a deflationary price level; 2.
or that fund set
up or this or that union wage scales are frequently
provision .approved
which; - al¬ 'too high' compared with non¬
legedly, is for "social welfare" of union scales in the same industry;
his particular union or group. It is 3. union wage scales are 'too high'
time, therefore, that some of the for a declining industry. At bot¬

other wage and social welfare fal¬
lacies which confront the country

tom," he continues, "these criti¬
simply signify that union
i: be considered in the light of basic wage scales are 'rigid' in a down¬
ward direction."
In a "Note on
principles and real facts.
Cyclical Wage Rigidity",3 this same
Fallacy of Inflated Wage Scales
writer says "The term 'wage rigid¬
and Rigid Wage Demands
ity' will here have the following
With the inflated wage scales connotation: The greater the lag
cisms

today, it is becom¬ of the. (cyclical) downward turn¬
ing more apparent that, in the tra¬ ing point in hourly wage rates be¬
vail through which our economy hind
the
(cyclical)
downward
is passing, there is no real chance turning point in the volume of
for "collective bargaining," except employment in a given industry,
in name, when labor and labor the greater the rigidity of wage
unions come to the council table rates in that industry."
In gen¬
with rigid demands that none of eral the terms "rigid wages" and
the
so-called
"social
"wage
rigidity"
are
used
in the
gains
of
labor" of the war period, and of above sense, but at times they
13 or 14 years of governmental may be used in referring to the
coddling of labor, be minimized vime lag in wages in comparison
with the fall in general prices as
or given up.' It goes without say¬
which prevail

ing that these include all the
time

boosts

war¬

in pay

provided at a
time when goods had to be pro¬
duced

costs.

well

the

ment in
We

decline

employ¬

given industry.
still in

are

era

rising

price regardless of prices despite all that OPA has
poin.ed out in the re¬ allegedly been doing to the contra¬
strike, the CIO demands ry. But if prices are to be brought
for wages were staggering ones.* down
through increased mass pro¬
"In substance, you ask for nearly duction in the
fields in which ihe
the same pay for 40 hours of work demand for
goods is heavy, then
as is now paid for 48
one
hours, in¬
factor which may retard that
any

cent steel

cluding eight hours of overtime at downward
time and
amount

half pay.
an

That would

increase

22.1%

movement in

prices is

the unreasonable and
unreasoning
demands of union labor for main¬

weekly

straight-time taining inflated and rigid wage
wages, with a 16%% reduction of scales or fighting for ever-increas¬
productive hours per week and ing wage rates. If, as in the ar¬
a
consequent
reduction in the ticle of Professor Lutz referred to
average

weekly steel output
But

in steel

per

worker."

among

auto¬

above, wage rates are too high or
too rigid for employers to
make
much

motive workers, meatpackers, bus
drivers, elecirical
workers
and

Others, the only point of collective
bargaining seems to have been to
push abnormally high wartime
wages
ever
higher and higher,
even though wages in most such
industries have already increased
much more than the cost of living
in the period 1941-1946.
In theory
what capital and labor come to the
bargaining table to bargain for is

do;

use

production

of labor

as a

factor of

they would like to
if they adopt the practice

or,

Deal's
Forgotten
Men are the
the Forgotten
clean, quiet, vir¬ "tramps and outcasts," the "crim¬
inals"
the
"poor and weak," the
tuous domestic citizen, who pays
his debts and his taxes and is "paupers and the loafers," the "ig¬
norant
and
illiterate," ihe "job¬
He is the victim of never heard of out of his little

Roosevelt would have

"Who

think,

thought of.
the

...

reformer, the social
and philanthropist,"

specu¬

and

Ihe

when

cost

too

high, then labor in
true collective
bargaining should
be willing to reduce the price Of
its factor, the wage rate.
The fal¬
lacy of rigid wage demands, how¬
ever,
in the face of downward

the New Deal.
"Now who is the Forgotten Man?
He is the simple honest laborer,
ready to earn his living by pro¬
ductive woi'k. We pass him by be¬
cause he is independent, self-sup¬
porting, and asks no favors. . . ."
Even if "A and B put their heads
iogether to decide what A, B, and
C must do for D, there is never
of

the tax lists in

into the newspaper except
when he gets married or dies.
He
gets

keeps production going on (except
labor

when

leaders

Walter

Reuther, Harry Bridges, John L.

Lewis, 'drunk with power,' stifle
all

and

work¬

"inefficient

the

and shiftless artisans."

men

these

not

clothed

the

ill-housed"

and

much

heard

whose

"social

make

ill-

have

and

about,

welfare"

outlays

such

Are

"ill-fed,

very

for

must

of taxes

and

relief funds?

The Fallacy of Trying to Abolish.

Poverty

every ton of bituminous coal
election year, his taxes are actual¬
produced, which it was estimated
ly raised, although direct and in¬
would have amounted to from $50
direct inflation have already cut
to
$60 million annually, shows
heavily into his sources of income
how far this so-called labor lead¬
and his real earnings. But to con¬
er
is willing to go to make the
tinue with Sumner
for another
Forgotten Man pay for Lewis's ex¬
paragraph:
travagances and for the alleged
"Such
is
the
Forgotten Man.
"social welfare" of his "forgotten
He works, he votes, generally he
men."
prays — but
he always
pays —
The Real Forgotten Man
yes, above all, he pays.
He does
not want an office; his name never
Let's see more of Sumner's For¬

Man

less"

able

removed from

gotten

gotten Man in contrast to Ihe For¬

then,

labor

is,

He is the

circle.
The Forgotten Man is
delving away in patient industry,
Sumner had lived through the 30s,
supporting his family, paying his
he would have undoubtedly added
taxes (always paying), casting his
the politician, the labor
leader, vote, supporting the church and
and most labor economists to this the
school, reading his newspaper,
list:
and cheering for the politician of
Put more vividly still io bring his admiration, but he is the only
out the fallacy of the Forgotten one for whom there is no pro¬
Man
as
he was ballyhooed and vision in the great scramble and
."
misrepresented
by
New
Deal the great divide.
propagandists, as over against the
The
New
Deal
and
The Real
real Forgot .en Man, when A, the
late F. D. Roosevelt, the politician,
Forgotten Man
and B, John L. Lewis, labor lead¬
What have administration cir¬
er and erstwhile supporter of the
cles done for this Forgotten Man
New Deal and its head, put their
during the past 12 or 14 years?
heads together to see what C, the
His thrift is no longer a virtue,
small coal producer, the consumer,
and his savings are a menace to
and John Q. Public should do for
the proponents of a "mature econ¬
the Uniied Mine Workers' mem¬
omy." He votes, but his votes do
bers, surely the latter were oy no not
count much when compared
means the Forgotten Man or Men,
with the "votoeracy" which the
they were almost anything else New
Deal has built up out of its
but.
Yet these were the ones for
squandering of billions of tax¬
whom
John
L.
Lewis was and
payers' money on relief, whether
still is fighting for their so-called
needed or not, and on every im¬
"social welfare," with the public,
aginable type of spending pro¬
the small producer, and the con¬
gram.
His voice, taken in the
sumer
of coal actually or poten¬
mass, is inarticulate.
He has no
tially paying the bill.
And the
lobby in Congress. When 12 mil¬
recent attempted hold-up of John
lion lower income taxpayers are
L. Lewis for a royalty of 10c a ton
lator

place of labor insofar

are

Man?

but instead the real Forgotten Man
is
the
man
C
"who
is
never

of substitution of other factors in

they

.Thursday; July 18,1946

time.i; We do not remember him ten4 Wbmeh today are called upoil
because he makes no clamor... ."6 to help and support?
The New

Mote Fallacies About Wages and Social Welfare
outdo

;fUr

production to gain their ends.5

Another
with

fallacy

vague
and
"Social Welfare."

term

social

that

told

itself

concerns

that

nebulous
We

welfare

are

will

greatly advanced when poverty is
abolished. That is like striking at
nothing in thin air, for after all,
poverty is nothing, and as Keller
has so graphically pu t it in "Man's
Rough Road":7 "It is a basic fact
that men start with nothing. What
needs explanation is not poverty
but wealth." You, i.e., society, can
abolish
wealth;
it
can
abolish
property; i; can abolish capital,
but "Poverty is not 'caused' by
others'
a

oppression; it is there, as

zero-line

oned.

all

wealth

de¬

reck¬

You do not need, even now,

how

told

which

from

toward

parture

become

poor

than how to fall down
an elevator shaft; all you have I©
do is to let yourself go, and the
nature of things will take care of

any

movement in

the

rest.

the

other

direction that calls for

That which

effor: and

schooling.

has led

to where we are is not

beckoning

the

plump

and

genial angel . . . but shrewd prods
from the sharp stick of Necessity,
from behind.
And the features of

necessity

are

those of Hunger and

Want.v

of mine in
Service of the De¬
partment of State went down to
Washington in the early days of
the New Deal to help "save the
country."
By 1935 he had be¬
come
so
imbued with the "new
former colleague

the

Foreign

the strength of philosophy" being peddled around
flattered before there that he broke forth into
election. He is strongly patriotic. print wi.h a new book entitled
the cost Of labor as a factor in pro¬ movements in production and em¬
He is a commonplace man. He "Farewell to Poverty." His argu¬
duction, the price which the la¬ ployment is not recognized by the
ments are not worth going into
borer or labor union is willing to rank and file of labor,
nor, as a any pressure on A and B.
They gives no trouble. He excites no
take for labor. But when the price rule, by labor leaders themselves. consent to it and like it. There is admiration. He is not in any way here. He became a great advocate
of the slogan of his chief—Henry
of labor is set or determined in I- is usually only after
long pe¬ rarely any pressure on D because a hero—like the popular orator; or
Wallace — "human
rights vs.
advance either by the laborer or riods of increasing unemployment he does not like it and contrives a problem—like tramps and out¬ a
trade union, or by a paternalistic or
after'an
The pressure all casts; nor notorious—like crimi¬ property rights/' A later book on
unsuccessful, pro¬ to evade it.
government upholding or admin¬ tracted-'Strike that trade union comes on C"—the Forgotten Man. nals; nor an object of sentiment- Nudism caused him to part com¬
istering a one-sided Wagner Labor members more or less force the If A and B agree to spend Sun¬ like the poor and weak; nor a burr- pany with Wallace and the FEA,
Relations Act, genuine collective hands of their union leaders and day in a certain way . . . they get den—like paupers and loafers; nor but his earlier effort in the field
bargaining becomes an impos¬ cause them to permit rigid wage a law passed to make C pass it an object out of which social capital of "abolishing poverty" must have
been appreciated! The fallacy lies
sibility and that which goes on is scales to be lowered.
their way. They determine to be may be made—like the benefici¬
in the fact that this simply cannot
a farce.2
teetotalers and they get a law aries of church and State char¬
be done as long as human beinj;
The Fallacy of the "Forgotten
Flexible wages provide that in
passed to make C a teetotaler for ities; not an object of charitable
are human beings.
John L. Lew.<
times of falling prices and increas¬
Man"—New Deal Type
the sake of D who may drink too aid and protection — like animals
a
form of "welfare fund"
ing unemployment, wages as a
Another fallacy which has been much"
If D gets drunk and treated with cruelty; nor the ob¬ got
which may, if not rigidly guarded,
cost of production should likewise
brought inio prominent relief in falls into the gutter then C has to ject of a job—like the ignorant
fall, but because of the time-lag the recent strike tactics of John pay taxes for the support of the and illiterate; nor one over whom be used more for the welfare—
in wages they ordinarily will not L.
political and/or union-wise — of
Lewis, is the almost entire mis¬ policeman who comes to pick him sentimental economists and states¬
John L, Lewis than for the "poor
fall as rapidly as prices, and hence
conception of the "Forgotten Man" up. If the "poor and weak" are men can parade their fine senti¬
provide for greater real wages as as used by the late President F. D. always objects of public interest ments—like inefficient workmen and weak" United Mine Work¬
Therefore, ers! But stark and bi.ter poverty
long as employment continues. Roosevelt in the early years of the and public obligation, the inter¬ and shiftless artisans.
he is forgotten.
Rigid wages or rigid wage scales, New Deal, when
All the burdens will still knock again at the door
compared and est is on the part of A and B—the
of miners and other laborers alike
oil the other hand, tend to remain
contrasted with the real "Forgot¬ social reformers—and the obliga¬ fall on him, or on her, for it is
fixed as production and employ¬ ten
time, to remember that the For¬ when depressions come, and when
Man"
of
William
Graham tion is always on C who pays the
ment fall off. As a matter of fact
gotten Man is not seldom a wom¬ strikes are unsuccessful and dis¬
Sumner, noted Yale scholar, in his cost.
"rigid wages" have been defined more or less immortal
It is plain enough that the astrous from the point of view of
"He (C) does not appeal to the an.
essay on
the strikers concerned, despite all
and described by Joseph Shister this
subject some 50 years ago.4 emotions or excite the sentiments. Forgotten Man and the Forgotten
the
so-called
"social
gains of
in the following language.3 In de¬
According to Sumner's conception He only wants to make a contract Woman are the very life and sub¬
labor." Let thrift again come into
fining "wage rigidity" or "rigid of the Forgotten Man, when A and fulfill it, (contrast his posi¬ stance of society."
its own and poverty will take care
wages," he says that critics of and B put their heads
I have quoted at length from
together to tion with that of present CIO
of
itself without
having to be
union wage policies have levelled
see what C shall do for
D, then and UMWA leaders)5 with respect this fruitful and thought-provoca
"abolished."
the following criticism at such C and not D is the
real Forgotten on both sides and favor on neither tive source in order to bring out
policies: "1. Union wage scales are Man. Giving more
reality to these side. He must get his living out into bold relief the real character
7 A.
G.
Keller, published by
of this Forgotten Man. Nurtured
symbols, when A, the politician of the
1 In
the Frederick A. Stokes Company
capital of the country. The
article
on
"Living Wage and B, the social reformer, con¬
as we were 30 and 40 years ago
and
Yale
University
Press, 1932,
Standards
Fallacies," "Chron¬ nive to see what C, the steady larger the capital, the better liv¬ at Yale by this sort of milk, is it
pp. 83-84. Quoted with permission.
icle," Dec. 20, 1945, quoting Mr. self-supporting, middle-class tax¬ ing he can get. Every particle of
any wonder that many of us can
John A. Stephens, Vice-President
payer, shall do for the "under¬
capital which is wasted on the with difficulty stand by quietly,
of the U. S. Steel Company.
privileged" members of society— vicious, the idle, and the shiftless when the very exceptions to and Delafield & Delafield to
*
Cf., Article by Professor Harthe very opposite of what the real
the "ill-clo.hed,
ill-housed, and (Roosevelt's
ley L. Lutz, in "Chronicle" for
"underprivileged
Forgotten Man is are held up to Admit H. Allen Wardel
Jan. 3, 1946, on
ill-fed"—-then
certainly the latter masses, with votes to spare)5 is so view as the "poor and weak"
"Wages, Profits
Delafield & Delafield, 14 Wall
and Prices."
group are not the Forgotten Men much taken from the capital to whom
the
middle-class, white3
Street, New York City, members
Quoted in an ar icle by the
reward the independent and pro¬ collar Forgotten Men and Forgot¬
4 In
writer on "Rigid Wages, Unioniza¬
of the New York Stock Exchange,
"Selected Essays of Wil¬
.

He contributes to

parties.
.

...

tion and Reconversion

ductive

laborer.

ill

with

backs to the independent

Problems," liam Graham Sumner," edited by
"Chronicle," Jan. 25, 1945, from A. G. Keller & M. R. Davie, Yale
two articles by Joseph Shister in
University
Press, New
Haven,
"Quarterly Journal of Economics" 1924, pp. 257-281; quoted herein¬
and /Thfc :Americaa Economic Re- after
by special permission of Yale
/'View.!V Press and Professor Keller.

and"
5

our

productive

Parenthetical

by the writer.

But

laborer

stand

all

additions

the

made

Sumner,

op.

cit., pp. 264, 268,

278.
Quo ed in detail and
paraphrased with special permis¬
sion of Yale Press and of Albert

270,

Galloway Heller, literary executor
of the late W. G* Sumner.

will

admit

nership
has

been

Allen

member of the

Wardle,

Exchange, to part¬

Aug. 1.
doing

Mr. Wardle

business

individual floor broker.

(Volume 164

Number 4508

THE COMMERCIAL & FINANCIAL
CHRONICLE
v-

•

.......

***»/:

•*;%£;

other

activities of the;"Foreign
Service which we plan soon to
to the State Department.

cussed them with the War De¬
partment and the Department of
State. I am very hopeful that we
We are setting up new trade Ad- shall soon work out a
formula for
visory Committees that will help doing business in the
occupied
us guide negotiations pertaining to areas
which will satisfy the mili¬
the relaxation of controls and tary and political considerations
possible modification of the for- and will not impose too great a
eign trade programs of other hardship on the business commu¬
countries.
countries. We
we are analyzing the
nity of this country.
material that
tiia+ is
4- coming
—. in
*•- from
*
material
the field so that discriminations
Importance of Future Foreign
against American interests may be
>y;
Trade
quickly picked up, and so that we
I do not have to stress to this
can go into high gear to help
group
the
importance to our
eliminate them.
We are
also
economy of foreign trade. But I
working on ways and means of do want to
bring but one espe¬
helping our businessmen meet the
cially important aspect of the
situations that have been created
present supply and demand situ¬
by nationalized trade in some
ation pertaining to
foreign trade.
areas of the world. We shall try
We are keenly conscious today of
to hold an umbrella over the
the shortages in the U. S. and the
American businessman that wil
bull market for all kinds of
goods;
make it possible for him to trade
but, already, in some of our most
reasonable basis

Problems In International Trade Relations
-

wsubmit

"J. •

.u'.-VAAWV

l»

•

of pre-war

(Continued from page 337)
certain amount of the wartime
work could not be discontinued
a

immediately, and those functions,
important of which was
the administration of export con¬
the most

trol, were transferred to

the De¬

Commerce. At just
Secretary of
would sep¬
the foreign work from the

partment of

about that time, the

Commerce decided he
arate

domestic work in the old Bureau

Foreign and Domestic Com¬
A logical merger then took

merce.

that part of the

between

place

wartime FEA transferred to

Com¬

foreign work of
Foreign and Do¬
mestic Commerce. It is the mer¬
and

merce

the

Bureau

of those two groups that is the
historical background of the Of¬
ger

Trade. And
this new office, there
were thus preserved some of the
benefits of concentrating foreign
economic operations in one part of
fice of International

through

exports,

UNRKA

shipments,

the

During
work
and

the

war

We want to

trade

the

coun-

interpret to the
for

reasons

American

export restrcitions maintained be-

still be considered necessary here
1
luumnes.
we want
and An
in v/mc
other
countries. We
to
to carry the advocacy
advooarv and
anH reprerpnro.
sentation of American commerce

is exporting at only onefourth above her pre-war level,
nerve,

That,

however, is a remarkable
considering the shat-

achievement

tered state of her economy.
Our study of estimated foreign

requirements

indicates that the
present rate of U. S. exports will
continue at least

through the end

of the year. A breakdown of these

estimated

requirements
shows
that this year American commodities may be sent abroad in about
the following amounts:
....

$894,000,000

worth

edible

animal

products;
$148,000,000 worth of inedible

foreign

animal products'
oducts;

Bureau of Foreign
Domestic
Commerce
had

exporters

tries.

than

cause of those
shortages, and despite
spite import
import restrictions
restrictions and
and exexchange shortages abroad.
England, straining every economic

$994 000 000

vpsfp-

oroducts-

$^60 non 000 nf inpdihlp

vpw

tahle fnori nrodncts

reasons

tain programs and

into the

why

cer-

controls

may

international organi-

new

zations related to the United Nations, particularly the Economic
Social

and

Council

and

its

spe-

cialized agencies—the Bank, the
fund and the proposed International Trade organization.
The
OIT should perform the

same ser-

vices for U. S. business in these
international agencies that it does
within the national government.
We must arrange for the visits
of American businessmen to be
related to the programs of foreign

ties

are

through

embassies

through lem of finding the best way o.
some
helping in some of these
situw**vov
oxm*
cases be of assistance.
ations, but we are working hare
You are a11 aware o£ the policy on the matter, and I feel quite
of.this Government in connection confident that we are going to be
with the State Buying Missions of some assistance on this most
—-x—-o

ho Af

sksss

the background
activities had been given

been relegated to
and war

A great backlog of in¬
formation from the Foreign Ser¬
vice had accumulated but had not
been fully analyzed or sent to the
priority.

What

trade.

^'manufactured
$3 419 000 000

$736 000 000

up-to-date, and
especially to try to make it fit the
changed world situation that we
bring

trade,

eign trade.
•

up against the
trade as carried
on
today involves so many new
and
<*nu
difficult
uixi-icuiu
piyyiciuo
problems that
mat
we
wc
mav have
havp to
to change
considmay
change auite
quite considerably the nature of some of our
services.
sci viucs.
a
I am sure
sute we
wc suaui
shall nave
have
to supplement them with other

brings

fact that foreign

order to

increase

$9 billions

ports

(which,

must do far

in mind is the
fact that throughout the world today foreign trade must be
on
w thin
the limits of

from abroad

rate

present
per

in ex-

year

incidentally,

in-

carried
rather

enort to obtain relaxation
effort
nf controls,
nnntmie but
Vmt ">«
—3
_
of
we must endeavor

to influence the foreign trade pro-,
so that thov
they

grams of otiier
other lands

fit with what

have to offer and
tn nhtoin
want to

wp
we

now

obtain

to the newer and

supplementary services that we
want to
foreto
trade community. I want first to

pSform fo^tL

of the countries; «on coordinated with the Qtiite •
with Which we do business/Those Department and through the r»eJ
programs vary from very firmly dium of the Foreign Service. We!
set schedules, such as you find in must arrange for closer contacts
countries like the U.S.S.R., Poland and, on a reciprocal basis for the
and the Balkans, and, to some deexchange of economic and statisCzechoslovakia,

the

such

programs

£ra,?Cei
Holland.

Theie

are

Commerce

Ministries of Commerce

our

and

of the

5^ is back of the formation of

some

these programs
if
and means

foreign

ways

it is considered paramount public policy that the state
direct its use only for the pur-

them

imports or services esthe rehabilitation of

for

programs can be changed by negotiation to fit better with what
America has to offer and with

them together.

Where

what

advisable to obtain more foreign exchange by inAU.
_A.A.
•
A.l_
creasing exports, the state is tak¬
ing steps to establish a predeter¬
mined level of exports.
Mj

xv*

America

wants

Our Future Trade

difficultes.
one

are

this surplus capacity in the U. S.
be quickly fitted in with the

high

home, and so that we can con¬
tribute quickly to the rehabilita¬
tion
and
construction problems
abroad.
abroad.
»

We are appiying ourselves to
this task and to the other obiectiVes j have menti0ned.'
What—

ever contributes to the

reconversion

cushioning

cutbacks,

ships

those

make

your

most

are

the factors

work

and

ours

that I know.

offer to sell or a solicitation of an offer to buy these securities.
offering is made only by the Prospectus.

paving the way for easier trade
between the U. S. and other
lands,
we
want
to
wc
want
to
establish a relationestaDiisn

figures show that U. S.

commerce

exports are running now at a rate

are

policy

taining

a year,

running

than three times the value

Mortgage Bonds, 3%% Series due 1976

Dated July 1, 1946

Due

July 1, 1976

10146%, and accrued interest

Prospectus

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

and

establishing
negotiations

Commercial

loans, the relaxation

[

and in the

HALSEY, STUART & CO. INC.

BEAR, STEARNS & CO.

for-

new

eign trade that will permit us to
act as the advocate of American

And despite these con-

exports

Company

In order to carry on this work

billions in value

$10,000,000

Price

MERRILL LYNCH,

E. H. ROLLINS & SONS

(INCORPORATED)

INCORPORATED

peri

treaties'

controls!

official discussions of

WELSH, DAVIS AND COMPANY
July 12.1946.

PIERCE, FENNER & BEANE

OTIS &. CO.
JULIEN COLLINS & COMPANY

the

MULLANEY, ROSS & COMPANY
BURR &,

that
the

interesting and challenging

•

First

easing of political tensions by de¬
veloping easier economic relation¬

not an

Portland Gas & Coke

that
lot of dislocations
so

ways

W0I^lng ?n pr^josals re- something about it. I brought
gardm2 commercial reporting and back my findings and have dis-

quickly enough

don't have

I
1

priority needs abroad.

must do it

way o:'

Policy

tremendous demand for American

capacity is for goods
badly needed abroad.
working hard on the job
helping to find a way whereby

—

This announcement is

interesting part is that this

which

ac-

uuiituncD.

™i$? S*■
stssrr rm.
^5?. objectlves in mind,
prp^lem and trying to

The

developing

total

■L

The

obtain

these controls s^ip with our own foreign trade
and programs, there is through- community and with industries inout the world, as you all know, a terested in

of $9,150

than anything I know of

Ail

Demand for American Products

Our

the
tuc

self-evident that

easing the problem is to find

The

from these countries

;

our

1 ITS

and have

productive

of getting goods in and out of the
m anu uut ua me
occupied countries.
Doing business with control commissions is a

only

We know that the details of the

considered

trols

Economic and business

iuslnes! f°r uTs,but will occupied countries. Doing busitha? anythl"g 1 kn°w of ness with control commissions is a
separate economic new trick and the foreign trade
anil 7.11 1S t16.
that community of the United States
IcLnlil
t0 See happen' has not had much opportunity to
2220"*lea™ about it. I spent a week in
do

industries have been in to
given us figures
showing that right now they are
up against the question of chang¬
ing their schedules of production.
see

can

increases

seems

fail

"***
\JV" ""v
less v
business for
us but will

pletely broken or destroyed by
war, it is considered desirable that
the state should take the initiative

products.

that

near

with cutbacks, and with
considerable dislocations of em¬
ployment. Representatives of some
of these

influencing

quite willing to discuss their nlans
and to explain freely and frankly
the thoughts back of their plans

Irrespective

to find the formula will not
moo,,
mean

we are to find

agriculture, and transportation.
Luxury imports are
forbidden. Where the threads of
commerce have been almost comindustry,

iiiv* v

this
formula

that they fit better with
the interests of American trade
We already know that in many
countries the persons in charge of
the foreign trade programs are

exchange,

liRUl

ciivin
wjll make this possible.

for those

faced in the

are

we can

SS?
program Pf 1t.radeWhere theie is limited

in joining

find

not found

are

and For-

i°i^SUnrnlnr^

it is

must

the

general foreign trade programs of
all countries; we must become familiar with the basic thinking

chase of

Blocs
We

goods,

tivtiy in the occupied countries is
grinding slowly to a standstill and

A Formula Against Economic

De¬

.South American countries which
are administered in such a way as

sential

daily.

substan¬
If foreign

up a

future

The problems and difficulties o:
the
occupation
are
mounting

con-

looming

surplus capacity.

markets

areas.

Engla"d and must
eign learn
Tradewhat
in other lands.
We
are also the exabout the

controls

change

there

tical information between

partment

and fully

tial

the control commissions in these

trolled economies.

every

the igovernments

with nationalized

we can see

recent visit to Central Europe was
to try to find ways to deal with

fflarpcwasss

limited controls and more general

upyQn%

of the great general problems of
post-war foreign trade which is
how our free enterprise system is
to do business easily and freely

merchandise.

Referring

Thig pointg

important heavy industry fields,
such
as, for example,
railroad
equipment, some types of ma¬
chine tools, and later on commu¬
nications and power equipment,

1*ade With Occupied Areas

the

transition period. But there still
There is also a specialized fielr
remains the problem of doing with which we are concerned. We
business with countries whose and our allies have establishec
foreign trade is nationalized and military controls in the occupiec
who win carry 0n state buying areas and one of the objects of my

than just offer
It is going to be
necessary for us not only to bend
our

have

rhemiralc and

maintain and later

this

over

with what

activities.

What

volves the employment of an estimated four million persons) we

New Problems m 1 oreign lraae

This

machlnery

$417 000 000 mkPPl'lanpniK?
$417,000,000
miscellaneous.

in the conduct of for¬

ahead

see

marhinprv

nrnduct^and

relatpd

is to modernize the service

I^h'i

and

vPhiPlP*-

want to do now
to the

oui

the U. S. Army, we can in
** ^ ^

importers had

and

these

This last part of

program of work is the most dif•
ficult,
f
lcult, and I am frank-to
frank to say tha.
thai
we have not fnllv snlvoH
we
have not fully solved the prom

and in
in which,
whirh
very limited and
our

countries.

trade. This applies particularly to
areas in which the
physical facili-

PflSPc

worth

table font)

quite naturally been very much
curtailed.
The ordinary services
to

the trade programs of other

policy and the

the

our com-

exclusive

double the value of pre-war. This
is also despite shortages, despite

government.

this

exports, and

mercial

COMPANY, INC.

Stocks

fian&
E.

(Continued from page"340)c
of his message to the
Congress, in describing the perils
of an inflationary spiral. :But Mr.
Truman is 10 years late in admit¬

This Week—insurance

Stocks

Asked.
Pricq

LIq. Value,
12-31-45
♦Aetna

'Insurance—

;

$59

Agricultural Insurance

—

•

York—

Insuran<ie_l—

•

*Fidelitj)-Phenix

•

29.U

21 VA

.82

67.88

.55%

.82

-1

•

Franklin

—'

Fund

*Pireman's

•I

Hanover

116%

.94

26%

.85

—

North America

Fire

.71
.68

127%

.91

32%

.84

■

110.71

105

.95

98.01

.71

9.52

New Brunswick

less bale of paper money.

the
i

—:

Washington

*St. Paul F.

& M.__

43.48

.80

57.63

.95

.51

.80

122.78.

89%

.73

53.43

42%

73.65

.80

♦Springfield F. & M

preventing steady price increase

course,

Average of 30

____

basis;

Examination of the table shows'

that 16 stocks

selling above the

are

.65

should have included wages.

.73

from the first there were too many

.81

in the OPA more

goods we

iest

interested in es¬

hat.

Truman

Mr.

York.

New

ASSETS

Loans and discounts

ing

S3.6C3.68

United

(includ¬

overdrafts).

States

$15,621,560.89

Government

obligations,

direct

and

guaranteed

Obligations
Cash,

is doing

balances

with

74,750.00
other

items

in¬

balances,

reserve

cash

and

institutions,

cluding
of

States

subdivisions

banking
-

16,666,106.04
of

political

permanent
.78
trying to carry out the policies of
agency
to make America over
lis predecessor, which he does not
than in the job the Congress origr
fundamentally believe in.
As a
inally created it to do. Therefore,
matter of fact, our government has
help to explain this reluctance on much of its failures were of its
Urown too big for one man to suc¬
the part of the market to recognize own making.
i
cessfully administer.
That is, if
high liquidating values. Even.u-r
The observant citizen is aware
we are to remain a Republic.
ally, of course, the fire loss trend of an overdrawn
propaganda||o
;»■ What we need is a restora ion of
will recede and underwriting ret
it

the State

that situation as

the
he can.
It is all too evident
his hear., is not in his job of

Poor

process

collection

Banking
♦ none),

tures
Other

8,352,785.73

premises

owned,

furniture

and

fix¬

vaults...

and

l.oo

assets

96,489.62

TOTAL ASSETS
840,811,693.28
ratio of .78, while 14 are
selling below. Outstanding in the
LIABILITIES
first group are St. Paul, Insurance
Demand deposits of individ¬
of North America, New Hampinstill fear in ;he minds of a pel*
uals,
partnerships,
and
confidence
that
American,
industry
shire, Fireman's Fund, and Harlr suits improve. Investment income pie already bewildered by our dis¬
corporations
$20,267,406.72
can and will produce the goods we
Time deposits of individuals,
ford Fire, each of which has a has not only been well sustained* cordant
~
Democratic
administra¬
need.
We cannot have this con¬
partnerships, and corpora¬
with many companies has tion.
ratio above 90%.
In (he below- but
Certainly there is no evi¬
tions
5,413,317.05
fidence
as
long
as
government
satisfactory expansion
average group, American Equitf shown
dence to support President Tru-i
Deposits of ' United States
keeps its bungling hands clamped
Government
_1
able has the distinction of being throughout the war period.
4,245,251.63
man's and Mr. Bowles's prediction
so. tightly
on American business Deposits of States and politipriced at 50% of liquidating value,
It is of interest to remark that that unless total OPA. was con-!
cal subdivisions
5,513,119.19
and
agricultural
life.
Economic
and New York Fire comes next at invested assets
per share of these cinued there would be cjiaos.
Deposits of banking instituj
blueprinting has had an effect on
tions ,1
51%.
Both of these are in the 30
651.510.00
companies average ' approxi¬
We
are
living once, again a business opposite to the proclaimed Other deposits (certified and
Corroon
&
Reynolds group of mately 15% more than liquidating
officers' checks, et"c.)____
more normal American economic
1,819,258.44
objective
of
the
New
Deal,
It
has
companies. Third lowest is Bank¬ values, "consequently, the investor
TOTAL
life. The OPA discontinuation has resul ed in
big business growing
ers
& Shippers with a ratio of in insurance stocks today may av¬
llpQSITS $37,909,863.03
not been the disaster predicted
298;089.35
bigger. Small business has been Other liabilities
59%.
"■* :■ r: erage approximately $1.50 of in¬
administration spokesmen.
Cer-j driven to the wall by restrictive
TOTAL LIABILITIES (not
Home and Franklin normally vested assets for each dollar in¬ tainly events since the discontinu-l
policies. Bureaucratic stimulation
including
subordinated
vested in the stock of the "aver¬
are priced at a premium to liqui¬
ation of the OPA do not warrant of
obligations shown below) $38,207,952.38
monopolistic combinations must
dating value, but bo;.h dropped be¬ age" company. And since these a continuation of the stiff and be stopped by a government pro¬
CAPITAL ACCOUNTS
low in 1944-1945 when the man¬ invested assets produce the invest¬
arbitrary wartime control, either gram which encourages competi¬ Capital t
$1,000,000.00
agement changed its investment, ment income upon which most fire in the OPA or o.her government
Surplus fund
750,000.00
tion.
Undivided profits
policy and went heavily into Gov¬
853,740.90
Just
as.
soon
as
we
can
be
as¬
insurance
companies
predicate
ernments during the war. North
TOTAL
CAPITAL
AC7
sured that the normal American
Hiver is another stock that has their dividend policy, this ratio is
counts
$2,603,740.90
economic way \yill prevail—that
rather
consistently been priced of significance.
NATIONAL
American indus ry will be encour¬
TOTAL LIABILITIES AND
above liquidating value, but which
allounts
$40,811,693.23
aged by government policies to
has sold at a discount since early
produce—that our American dol-.
iri 1944.
••
tThis
Institution's
capital
consists
of
Bankers to the Government in
far, free from crack-pot meddling, common stock with total par value of
Comparison and Analysis
Kenya Colbity and Uganda
jSome market likes and dislikes
remains sound—then the greatest $1,600,000.00.
"
are difficult to explain.
National
Head Office: 26, Bishopsgate,
2nd Quarter 1946
dapger of - inflation will be elim¬
MEMORANDA
London, E. C.
~'
Fire, for example, has an excellent
Pledged
assets,
(and; se!
inated/;'. V
rV. • '..J,'-.
•;!
Branches In India. Burma, Ceylon, Kenya
curities
long term record of earnings and
loaned)
(book
Thirteen years ago the very per¬
19 New York
Colony and Aden and Zanzibar
'
value);
dividends, yet consistently, year
sons how almost hysterical when •U..? S.
Government; obliga~
s
Subscribed Capital£4,000,000
after year, it;sells statistically one
tion?, direct- and guaran¬
confronted with the dangers they
Paid-Up Capital--£2,000,000
of the cheapest' of the old-line
teed, pledged to secure de¬
Reserve Fund
£2,200,000
have, created were boasting of
posits and other liabilities
Hartford Stocks. Marketwise, it is
$7,506,502.14
Circular on Request
The
Bank
conducts every description «t
their plans to make America over Other assets
pledged to se*
/banking and exchange business
usually a laggard in this group.
cure
deposits
and
other
With a managed currency and a
liabilities (intdudihg notes
Trusteeships and Executorships.
•
Generally speaking, liquidating
planned prosperity.
;; Laird, Bisseli & Meeds
and bills rediscounted and
also undertaken
vklues have increased substantial¬
Members New York Stock Exchange
Where were these fellows who

-average
(

But

37V4

122%

74.96

♦Consolidated

crees to regard
commonplace.

which

prices

57.04

tablishing

needed a war-:

control

time

Broadwqy, New York 4, New York:
at tjie close of business' on June 23, 1940,
published in accordance with a call made
by the Superintendent oi banks pursuant
to the provisions of the Banking Law of

built" crisis. The people
been brought by slow de¬

have

CONDITION

Company
of

carefully drawn to encourage

production of the

Underwriters Trust

budget.
statutes, however, should
federal

the

'Jerry

"black market" increase.

ana

167.00

U.S. Fire

balancing
tax

REPORT

need.

1.09

liberal and

are

going on inside. It is the bad;
For 13 years, more and more
system of treating the symptom
instead of the disease.
And the government control has been the
OPA was doing a poor job at that only answer the Democratic coal¬
ition could give to each recurring
in
Is

25%

federal1 taxes

All

Price fixing alone is like

fundamentals

pulling down the window shades
full
so ihat the public can't see what
,

misuse the label

play fast and loose wi h the truth

in government and high¬
in the program

economy

stop-gap of price

emergency

control.

Those

flation..

.83

Republicans must stand for

Every,

problem.
Mr. Truman,'in his message to;
the Congress, is still advocating

16%

♦Security of New Haven

<•

who

Republican Program

vital

31.23

River

♦Providence

would

a
positive program dealing with
intelligent American farmer real-;
the fundamentals of s opping in¬
izes that he also has a stake in this

31.62

New York Fire

•

OPA

presen;

because;

received for it was a use¬

—

♦New Hampshire

♦Phoenix

32%

31%

39.Q0

—

North

all they

National Liberty.

•"

46.55
45.90

140.61

♦Hartford Fire

Co.

.79
.69

30.91

♦Home Insurance

♦National

58%

their produce to market,

—

Fire

♦Insurance

75.77

92 36
123.95

Fire

American

♦Great

controls to prevent inflation.

controls work.

oorary

gent

the

—

___

*Fire Association

up what they were actually doing:
-They said the government had

need an adminis-

will make even tem-

They
An intelli¬
have prevented are now assuming that the merit;
ory
of
the
public
is
exceedingly
distressing
housing
impossible rents, and destroyed
savings.
The working man may. shortage. The Congress has been short. I said no administration—
one
as
feel happy over his wage increase; studying this question for months. especially
politically
but his wife knows when she iries; I do not believe it will be stam¬ minded as the Democratic coali¬
Ratio,
peded by the ill considered action tion—would have the guts or the
to buy food for the family ant
Market to
of the President or by the bally-; ability to use these controls iri
Liq. Value clothes for the baby that his pay if;
hoo of government agencies.
Th • time, that American economic life
.75
-j actually less because it buys less j
In every country that
suffers, Congress is. right, in its determina¬ was too big and too complex for
from inflation, prices always go| tion to gradually remove war ime a hodgepodge of conflicting gov¬
.50
j
.11
faster than wages.
In Ger¬ controls which prevent prudent ernment bureaus to plan effi¬
; up
men
from
attempting to make
.59.
; many, after the first war, infla¬
ciently for its management.
tion reached a point where her,! sensible adjustments to economic
.77
These
totalitarian
politicians
and
political
trends.'
.86
farmers found it useless to bring,

33.12

♦Continental

—■—-r

—-

Camden

City of New

80"

135.26

87.06

♦Boston Insurance

8VB

10.39 '

Shippers.'

Bankers ■&

23 Vi

—.

——

American

Baltimore

•

47.01

Equitable

American

118.60

all,

-ration that

7-10-46

$78.89

;

most of

ting to the people that the infla¬
tionary policies of the New Deal
threaten
skyrocketing
prices,

that out of a list of 30 lead¬
stocks, only one is currently priced
above liquidating value, viz: St. Paul Fire & Marine.
The other 29
stocks are priced at moderate to substantial discounts from liquidat¬
ing values:- The average - current ratio of market to liquidating
accompanying tabulation shows

The

ing and popular fire insurance

agencies, which the President is participated in that crime against
the American people, hi fact, they
requesting.
We undoubtedly need price con¬ invented a weasel word—"perma?
trol on such items as rents. But nen. deficit spending"—to cover

at leas, part

VAN DEUSENi

Thursday, July 18, 1946

FINANCIAL
&
CHRONICLE

THE COMMERCIAL

358

•

BANK

City Banks

„

securities

including

ly during the war years,
1945, but the market

120 BROADWAY, NEW YORK 6, N. Y.

Telephone:

has failed to

Bell

Heavy fire losses in

kpep

pace.

1944,

1945 and thus far in

1.946,

Bought

ANAYLZEP

—

Australia and New Zealand

Sold

-»—■

Quoted

REVIEWED

i •

- -

COMPARED

—

Inquiries invited.

Ja 5 p.

(P. C. T.)

Fund

Reserve

Liability of Prop.- 8,780,000

6,150,000

Aggregate

OF CALIFORNIA

#1210
—

r£C'..

Chicago

BAKER HEFFER,

090

Seattle

—
.

;

I-

Street, E. C. 2

Berkeley Squarp, W.; I

Agency arrangements with Banks

-tu.;

George Street, SYDNEY

29 Threadneedle

San Francisco
I*. £.

£223,163,622;

LONDON OFFICES:

WIRES

—

-TELETYPE I. ^ 873

•

America and the
in the

General Manager -*•,

Head Office:

West 7th St., Los Angeles
PRIVATE

New York

Assets 30th

1945

THOMAS

BUTLER-HUFF & CO.

throoghoul UmlIJl

impending danger tq
.world inherent
democratic coalition's fiscal

ple of the

£23,710,000
''

Sept.,

Orders solicited.

purposes

Government deficit
spending has done rilore to cause
inflation than anything else.
policies.'

}"
(

Deficit

Spending Produced
-Inflation

—

articulate administra¬
mouthpiece§, -'Who are

The very

;

tion

housetops about
evils" of: inf latioh,' themselves

shouting from the
the1

74,750.00
.

powers,/and for
other
than
to

<•

liabilities

secure

pressure groups

backing mp up 10
^gp "when
I was warning the American peo¬

£8,780,000

Reserve

Special Bulletin and Booklet Service to Dealers & Brokers
Trading daily f 3, m.

corporate

;

•

150,000.00

total

$7,731,252.14

Secured and preferred lia¬

Paid-Up Capital

under "re-

purchase agreement)
Assets pledged .to qualify, for,
exercise
of
fiduciary
or

with public
BANK~OF
funds were consistently undermin¬
NEW SOUTH WALES
ing the value of the American
(ESTABLISHED 1817)
j'. j dollar? I don't remember their
from

INSURANCE St BANK STOPKS

shedding crocodile tears

the evils of inflation during
the 13 long years when deliberate
deficit spending, and buying votes
about

1-1248-49

(L. A. Gibbs. Manager Trading Department)

now

are

BArclay 7-3500

Teletype—NY

sold

bilities:

Deposits

secured

by pledged

•

.assets ,'pursuant

quirements of law
Deposits
preferred

to",

re-

$7,540,209.76

____

•

under

- ;

provisions of law but" not
secured

by pledge of asests

total

3,969,165.64

$11,509,375.40

I,t WILLIAM D. PIKE, Secretary of the
institution,' hereby
certify

above-named
that

the

best

above, statement,

true

Correct—Attest;; WMIAM
c.

w
,

...

knowledge and belief.

KORELL

the

■"v-

PIKE
1

L[pirectoM
J.
...

B.'.V1'"TAmNEY-'--j"""

Volume

164

Number 4508

THE COMMERCIAL & FINANCIAL
CHRONICLE

359
remind

of the man who after

murdering hi& lather ahd:mother
pleaded
for
clemency
on
the
ground that he was an orphan.

'•

The working man should interhimself in more and better

est

permanently fence in Americaii iriativ£,£rphches of the
labor, industry and : agriculture [ment \^orK
he does need to return to time-

It| is evident that a friendly and needs
——fqir
administration, will come knows

govern-

coherently.

hope the Republicans in the
simple-principles of Repub- Congress support Senator LaFolgovernment.
They .are so fe'tt s bill to bring the machinery

j tested
lican

developing

gram than
a

workable

administration

that

where the money comes •
from and how hard it
is to get.
An
administration
whose
phi¬
losophy »is not to entourage Amer¬
icans and foreigners alike to
grab *
continuously from
the
United
States Treasury wi h theidea
that
the sky is the limit. An-adminis¬

nearer

pro¬

with

punitive attitude towards either

some of the modern 6f the Congress up to date;
""
As side:
""•*7
goods in exchange for a week's; superficial Liberals' WiT
probably Raymond Moley said, "It is no ex¬ ! America needs an adminis ra¬
work.
He is now. being tricked
^neer a. them as platitude.
aggeration to say that this bill is tion that will take
vigorous steps
but pf bona fide wage.increases by
I do not mean an aami nstration the most
constructive measure to to.
clean, -out
theCommunist
money "manipulations of the New. should not be studying and formu¬
improve the efficiency of the na¬ traitors, that now
infest many de¬ tration that will
Dealers.
not double cross Experience of ancient lating, a
long-range
policy
to tional
legislature .that has ap¬ partments, of our federal govern¬ the American
and modern history shows infla¬ meet
people by continu- such revolutionary problems peared in 100
years."
ment.
Lenin said that America ous
tion is really a slick device for as the
misstatements
of
mechanical coLon picker
material j America needs, an. administra¬ was the grea est obstacle to world facts, with intent vo
slashing real wages.
deceive.
threatens to create in changing the tion that is not rendered
impotent revolution and « that the destruc¬
There is nothing the matter with
I The scheme in modern dress was'
present occupation of millions— -Hby its in ernal political and eco¬ tion of the
value of American the. United
cooked up by the mas er-mind be¬ or the a.omic bomb
States that a little
in peace" or nomic feuds—to deal
effectively money and American savings was corhmon sense and a
hind the New Deal, Lord Keynes. war.
little common
' I. -rv with
the
way
wdn^ttuctxori
to, conquer America, and
The victims of this scheme, incor¬
honesty on the part of its political 7
j# I do mean that a competent and problems and the obligations it that is
just
what the New Deal,
rectly described by its sponsors; as efficient administration would not has assumed
leadership will not cure. As Adam
abroad,
7,7 7
consciously' or unconsciously, ha$ Smith
money management, are the work- \ allow the
said, "Any nation can stand •
day.-by.-day events to ; The public interest demands been,doing
'
for
13
years.
The as lot of ruin,"
ing men, pensioners and all others! form its policies,: as has been true
Especially that is j
tjhat;labor
;ber ahle7to baigain; col¬ election of a Republican President
with fixed income.
tfue of! the great - American peo¬
of the Democratic coalition. ~ In¬
lectively on an equal basisTwith and Congress would be notice to
ple.-,.::, 7:n;77'
Using subtle academic double stead of formulating, the broad the'r
employer..
That
calls
'for every disloyal Communist and fel¬
We must) constantly inspire the
talk, Lord Keynes gave a blue¬ ou lines of national and interna¬ unionism. Bu.
the public must bp low. traveler to
pack
up
and
get
qualities of individual initiative .]
print of this gigantic hoax in his tional policies and working in that protected
by. our national admin-* out, We need an
administration and self help, which made us the
book.
direction, we have had for 13 istration
from
coercion
and that will
unequivocally make it most powerful ha .ion in the world
Whether the dumb New Dealers years an erroneous
"quarterback'1 squeeze by huge labor, unions and
plain that friendly firmness with and
intended it or not, .heir fiscal pol¬
gave the American people the
theory of government. That has management
monopolies,
alike. Russia does not include toleration
largest measure -of happiness of *
icy is a way of cutting your wages brought us to the brink of catasNeither has the right to imperil of her
unfriendly fifth column any people in the world.
—cutting your pensions—cutting trophy, both at home and abroad. public health and
safety.
After activities in America or her un¬
the value of your savings—while
The postwar promise of Ameri¬
We have had 13 years of Whits
sill, labor is a component pqrt of declared war of a
g g r e s s i o n can Ufe can indeed be
promising the more abundant life. House leadership that has based the public, so is
bright if
management.
throughout
the
world.
As the day of reckoning inevit¬ ac ibh on political
we, the people, make intelligent
It is evident tha: public inter¬
strategy.
Tha«,
7j
j All issues in the end are tied to decisions and
come to grips with 7
ably approaches, clever political "slick" wav hasfailed to solve our est
requires a basic labor policy. a sound dollar.
America
badlj our problems.
manipulators are undertaking a labor, agricultural and
employer
shift play by blaming quarrels be¬ problems—nor is it the road to a
tween labor and management so peaceful
world. The Republican

j simple that

...

that the confused worker will miss
the fundamental

and

cause

party—if the country is to be
forget saved—must nominate for Presi¬

who really trimmed him.
The rank and file of thrifty and
industrious
American
citizens

dent

who will

man

on-principle.

base action

As far as I am con¬
tHe first -require¬

that is

cerned

need to be rescued from phony ment
in
our
next
Presidential
prophets and false leaders.
nominee.
It is sheer folly for our nation,
We need an adminis ration that
the most successful in history, to understands and
carries out the

emulate

collec.ivist

basic

principles

weaker and less successful nations

form

like Russia and Great Britain.

period

course

and

will

patterns

have good

times

bad

times, but tjie forgotten
worst slump in the
United States had a higher stand¬
ard of living left and more secur¬
ity than .he Russian Communist
proletariat today. England is now.
trying to combine the totalitarian
state and political liberty.
If it
w^orks successfully, it will be the
first time in all his.ory. We wish
man.

the

of.

Republican

Over

government.

years

DETROIT, MICHIGAN

this

"slick"

Complete Banking and Trust Service

"quarterbacking"
our
cabinet
meetings have become a joke. No
longer does the cabinet meet to
obtain a picture of the whole and
formulate a policy.
Each member
has become

STATEMENT OF CONDITION JUNE
29,

representative of a
pressure .group.
The Secretary of
Agriculture represents one group.
The

Cash

The Pearl Harbor

Stock of the Federal Reserve Bank
Other Securities

spite of the confused leader¬ retary of War did not know what
ship of the Democratic coalition the
Secretary of State was doing
has snarled
our
economy, until he called
Up to find out, It
Capitalistic America is able to is clear that the
Secretary of Sta .e
pour out charity to all the nations was
pursuing a policy without
of the world while Communistic
knowing whether the War Depart¬
ment

was

able. to

back

him

cost

and

unbalanced

budget,
finan¬

between world peace

and
cially sound America.

The pattern of American prog¬
ress is distinctly our own.
It has
proven

to be an
in

bination

invincible

peace

com¬

war.

greater proof can there be than
bur ability to stand 13 years of

The

Secretary

was

son's
his

view

until

awoke

Real Estate

from

In other words, we had
policies of the Secretary of
Agriculture prevailing for awhile

Branch

Catering to

As far

Minority

Groups

concerned I

opposed to tile Republican party
catering to any minority pressure
groups to win the next election.
The Republican
party does not
have all the answers to the enor->
mous
and
revolutionary
prob¬
lems confronting us. But here are

America

Customers'

Liability

need

jninous planned economy

1,455,000.00

72,204,329.83

...

156,146,555.52
27,225,271.33

1,099,496.14

Acceptances and Letters

of Credit

2,239,753.10

LIABILITIES
Deposits:
>

■

Commercial, Bank and Savings

$3 ,007,811,851.29

United States Government
Other Public

Accrued

137,306,572.81

Deposits

46,554,528.64

Expenses and Taxes Payable

Income Collected—Unearned

Common Stock Dividend No.
24,

Preferred Stuck
Common

•

1,810,346.61
.

254,229.36

812,500.00

;

2,239,753.10

8,153,405.96

8,500,000.00

Capital Funds:

Common Stock
r

■11,191,672,952.74

Payable August 1, 1946

Acceptances and Letters of Credit
Reserves

Surplus

12,500,000,00

;

Undivided Profits

27,500,000.00
.

7,631,589.26

coma.

47,631,589.26

international

our

relations—

1,261,074,777.03
United States Government Securities
carried
are

pledged

to secure

$171,364,577.38 in the foregoing

state¬

public deposits, including deposits of $23,048,'208.15
of the

Treasurer-State of Michigan, and for other

purposes

required by law.

ample of the erratic character of
national

the
OPA

bill,

devoted

the

administration

Truman's

which

veto

the

administration

Senate —Mr.

loyal

the

and

leader

Barkley —and
the House—Mr.

the Speaker of
Rayburn—had some hours before
urged the Congress to pass ;and

DIRECTORS
HENRY E. BODMAN

JAMES S. HOLDEN

ROBERT J. BOWMAN
CHARLES T. FISHER

JAMES INCUS

R. PERRY SHORTS

CHARLES T. FISHER, JR,

WILLIAM S. KNUDSEN
ALYAN MACAULEY

JOHN B. FORD, JR.

R. R. WILLIAMS

WALTER S. McLUCAS

C. E. WILSON

personally urged the President to
sign,
'v
"
^

Therefore, America will benefit^

TRUST
This bank

acts

committee pi the. whole rather

W. DEAN ROBINSON

GEORGE A. STAPLES

DEPARTMENT

Trustee, Executor and Corporate Agent

Member Federal Deposit Insurance Corporation

volu-lthan as representatives of special
designed groups, and the executive and leg-4
a

183,371,826.85

[,261,074,777.03

ment

as a

doesn't

2,827,746.98

few

stand for:

Mortgages

simple but comprehensive j immensely from a return to the
principles of government we must system whereby the cabinet meets

725,844,536.24

the

President

272,032,087.89

Buildings and Leasehold Improvements

government by well meaning but instead of the policies of the Sec¬
never-do-well-intellectuals'. ped¬ retary of State.
The latest ex¬

dling ctuack remedies and claim¬
ing fake progress.

Accrued Income Receivable

po¬

litical weapon. Secretary of State
Byrnes accepted Secretary Ander¬

„

Loans and Discounts

up,

Agriculture

did not think ihat food

Loans:

that

especial¬ and the War Department did not
ly their own people from discov¬ know what the
Secretary of S.ate
ering the facts oL the pitiful fail¬ was doing that
they might be
ure
of
Communism.
After
15 called
upon to back up.
years of preparation for war, Cap¬
To
cap
the disgraceful man¬
italistic America had to save her.
agement that led to the Pearl
Despite one strike crisis af er Harbor
tragedy—a spot that will
another, there are no inherent de¬ never come out on the record of
fects in our Republic that sound
every
high ranking army and
government policies will not cure. navy officer who had
any con¬
The surest way for labor to keep nection
with it—the only record
its social gains is to vote for those that
was kept of any conversation
policies. The sensible observant between cabinet members was that
citizen now sees the elementary
of Secretary Stimson—who was
truth, that there is a direct con¬ old fashioned enough to
keep, a
nection
between
soaring
living diary.

Han'd and Due from Other Banks

United States Government Securities

investigation

Capitalistic Amer¬ brought out at least one terrible
ica is about to subsidize this So¬
fact.
From
Secretary Stimson's
cialist/experiment.
testimony it is-clear ihat the Sec¬

to prevent the world and

RESOURCES

Secretary of Labor represents

another group.

them well and

Russia maintains the iron curtain

1946

-A

(

1,;-

V- H

iV ■

fcr'fc

THE COMMERCIAL & FINANCIAL CHRONICLE

*»' jr*

„

:*V>£

little publication is directed 'men
and women interested in'-the prh-

dept?investment *©f -money.' It is
primarily for, the 'Main Street'

Mutual Futuis

rather than the

'Wall

vestor'

Entente Cordiale
There

was a

time not so long ago

—

appropriate:

First, because it reflects the basic

when the big banks (and some

~oi the little ones) looked down their noses at the mutual funds.
''Never heard of it!" and "Oh, you don't want to get mixed up in any¬

thing like that!" were stock answers which many bankers gave their
this or that mutual fund.
But times have changed for the better.
Just to keep the record

-clients who asked about

investment

the

philosophy of the Put¬
and second, because
first came into promi¬

Fund,

nam

term

nence

result of

sion in 1830 by

Putnam of

famous deci¬

Mr. Justice Samuel

the, Massachusetts Su¬

preme Court, a great-great-grand^straight, the Boston banks were^
funds in that area because most of father of the Chairman of the
among the first to establish an
Trustees of this Fund. This de¬
them
moved
to
Jersey
City
in
"entente cordiale" with the open.end investment11 companies. The order to avoid the hamstringing cision laid down, the basic guideposts for the so-called 'Prudent
PennsylvaniaCompany cooper¬ New York State taxes.

the
But the New
in the main,

early with the funds in

ated

Philadelphia area.
banks were,

York
slow

extend

hand of

come.
^

wel¬

filV

important reason for this,
perhaps, was the existence until
just a few years - ago
of a
thoroughly stupid New York State
tax law affecting the operation of
An

repealed, the New York banks had
the

with

contact

mutual

Commonwealth

between the New York banks and

this

steadily growing number of other

gratifying point where several of
the largest and best known banks
have accepted the custodianship

"The problem of the investment

anty Trust Co. and the Bank of
New York are both in this cate¬

one,

Within the past

fortnight Group

Securities with assets of approx¬

imately

National

First

the

fund

will
and

become

Bank

the

registrar

new

the

Aug. 1, 1946. This new
relationship will bring into "part¬
nership" one of the largest and
fastest
growing of the mutual
funds with one of the best-known,
on

top-rated banks in the country.

savings is a serious matter
increasingly complicated
too. It is much more than a

terday's sacrifices and tomorrow's
hopes.'

quarterly, "The Prudent
Investor," isued by the Trustees
of the George Putnam Fund made
its first appearance

"L,

k-'uk PROSPECTUS ON REQUEST FROM
f

s")

YOUR INVESTMENT DEALER OR

D.strjbutors Group, Incorporated

-■(<63 Wall Street

New York 5.N.Y.

r..-

The Putnam Trustees have this
to say
-

about their

publication:

new

"The idea of 'The Prudent

vestor'
our

has

been

minds for

can

also make

modest

helping you
financial future more
skillfully, we will feel amply re¬
paid for our efforts."
plan

your

connection

planned

with

investment

its

new

program,

Keystone Co. has issued the first
of

series

bulletins

entitled

copy

of the bulletin. (50 Congress

St., Boston 9).
♦

—

serve's

com¬

National Securities &

than

Corp. has published an

regular quarterly reports and

one

in which

could from time

National-sponsored
showing portfolio
changes in all National-sponsored
funds during June
Keystone
on

Memorandum

Co.

from

your

"appraisal" folder on Selected
Groups Series. The brochure de¬

new

votes

separate section to each of

Stock Fund

request

10RDABBEII GROUP

Prospectus

request

upon

same

taxed

the

way.

Present Tax System and

businesses

gether

from

the

to the individual

freed

alto¬

corporation in¬

subjected only

jncome tax. Sec¬

ond, the corporation income tax is
levied at rates graduated accord¬
ing to income. In the recent Rev¬
enue Act of 1945, this graduation
was

first

increased.

For example, the

bracket rate,
lowered
by

formerly 25%,
was
4 percentage
points to 21%; whereas, the top
bracket rate, formerly 40%, was
lowered
by only 2 percentage
points to 38%. Under the recent
excess profits tax, a specific ex¬
emption (first of $5,000, later of
$10,000 and finally of $25,000) was
provided to eliminate the tax for
many
small businesses and to
soften the blow for the rest.
funds

The

of tax

the transition from war to peace
would be

financially difficult for

many

addition

these

corporation income tax due to the
relatively liberal allowances made
for officers' salaries, and due to
the fact that it is possible to real¬
ize income from small businesses
in the form of long-term capital

Lord, Abbett

Co.

INCORPORATED

New York

New York 5. N. Y.

—

per share payable July
15, 1946 to shareholders of record
July 1.

Chicago

—

Los

Angeles

/
SHARES OF CAPITAL STOCK OF

Differentiation

341)

page

The answer to this question de¬
pends in part upon whether or not
is desired

couragement

to give positive en¬
to the development

of the small business sector of

are

tax and are

come

NATIONAL SECURITIES &

120 BROADWAY

couragement should be

given via

preferential tax treatment.
There

are many

who look upon
sturdy
indispensable
to the successful functioning of a
free enterprise system and essen¬
tial to the preservation of our
the existence of

small

democratic

are

These

favor substantial
for smaller enter¬

benefits

prises.

institutions.

tend

people
tax

numerous

businesses

On the other hand, there

many who attach less

impor¬

tance to the role of small business
in a free enterprise economy and
are

accordingly less inclined
preferential
taxation

grant

Now I
answer

the

not going to try to
question of whether
should be given

business

small

special encouragement.
is much

I think it

fruitful to assume,

for purposes of

analysis, that the

desired

tax

neither

encourages

system is one which
nor penalizes
small business,
but rather one
which leaves the competitive re¬
lations
between
big and little
firms
as
though neither were
taxed.

On the basis of this
one can

assumption,

ask these questions: Is the

present tax system neutral as re¬
gards the competitive relation^
between small and large business¬
es? And if not, what changek in'

the present tax system would be
needed

order

this neutrality?

to bring about
Only by answer¬

ing these questions, does one have
a
sound basis for deciding what
changes in the taxation of small
business are needed to achieve
any given aim, whether that aim
be neutrality as between
small

large enterprises or special
encouragement to small business.
and

Sufficient?

basic question relating to
taxation of small business is
this: Does the present tax system

Relative Greater Tax Burden of

The

Small Business

the

fairly

strong

case

can

the correct amount of

PUTNAM

FUND
live,

Prospectus
may

be obtained

local investment dealer or

Prospectus
your

The Keystone

'
50

may

be obtained from

local investment dealer,

Congress Street, Boston 9, Mass.

;

may be

obtained

Prospectus upon request

from authorized dealers, or

Company

of Boston

SELECTED INVESTMENTS COMPANY

THE

PARKER

CORPORATION

ONE COURT STREET. BOSTON 8, MASS.

dif¬ made for the contention that small
ferentiation between small busi¬ enterprises are confronted with a
nesses and large businesses?
Or greater burden than large enter¬
should the differential be wid¬ prises when both are subjected to
the same taxes levied at the same
ened or narrowed?
allow

AMERICAN

your

to
to

smaller firms.

Prospectus

our

economy, and if so, how much en¬

from

of 5 cents per share for a total of

Small

Business

gains more often than is true in
the case of large businesses.

OF INVESTING COMPANIES

RESEARCH CORPORATION

stockholders

1* cents

(Continued from
should

concern

credits and re¬
provided under the Tax
Research Adjustment Act of 1945 was mo-,
excellent tivated in part by the belief that

Union Common

dealer or'

payable

The Taxation of Small Business

explicit
benefits, small businesses are said
to secure advantages under the

Priced at Market

Prospectus upon

Current issue of Keynotes;

—

small business.^,,

GROUPS Shares

1, 1946 to
July 15. '

A divi¬

—

power;
folder

tends-to discriminate in favor

£-y}.

(!$.■

smaller companies. More¬
the five major industries currently over, the special taxes levied on
this Fund and to other investors. represented in the Series, giving inter-corporate dividends and on
the filing of consolidated returns
"As stated on the masthead, this the
highlight^ OiijWhy each indus-

SELECTED

:iy

Aug.

Manhattan Bond Fund, Inc. —
Ordinary
Distribution
No.
32
amounting to 9 cents per share
and
an
funds;
extraordinary distribution

request for

July Current Information

,//j§

Current Investment Tim¬

speed-up

type of

our

of
the
many
important
points covered, we shall not at¬
tempt to summarize it here. In¬
stead, we suggest that you write
the Keystone Co. of Boston for a
cause

informal

to time discuss subjects of general
interest to
the
beneficiaries
of

Securities Series

some

contribution towards

time. We have

some

felt the need for
munication

In¬

germinating

Dividend Shares, Inc.

ing Service discussing Federal He-

vestor'

"Keystone Formula Plan Invest¬

and their clients.

record

small

ing." The first bulletin explains in
detail why accounts should be re¬
balanced at 90-day intervals. Be¬

and will undoubtedly find

Corp.

about this Fund. 'The Prudent In¬

late last month.

large and appreciative reader¬
ship among investment dealers

performance

all classes of Group

dend of 2 cents per share

in fact, explicitly recognizes the
principle of a distinction between
small and large businesses. First,
the great mass of unincorporated

It is fully on a par with the other
excellent material issued by this
group

Dividends

Revised

•

genuinely interested in improving
their investment programs. If, in
addition
to bringing
you
news

A new

Bullock

The present Federal tax system

Calvin

"We think that most people are

New Publications

mim

matter of dollars and cents. Your

announced

million

$120

custodian

month-end

comparison
Securities.

folder describing Dividend Shares
National Securities & Research

investment savings are truly 'yes¬

gory.

New York

*!"_A fmmmmrnmmwKk

Literature

Lord, Abbett — Current issue of
Abstracts citing favorable results
from several portfolio selections

of your
and

-and

Fund

states conduct their business.

of mutual fund assets. The Guar¬

that

LOW PRICED

Man Rule' wider which trustees in

the mutual funds has reached the

mutual funds. Until this law was

little

the cooperation

More recently

Special
Mutual

—'The Prudent In¬
seems

...

v -

name

tcy i? included. The indpstrtoRre; rJuly^Current Data folder on all
Automotive, Building, Household Keystone funds
Distributors
&
Office
Equipment, Railroad Group —a. Supplement to current
Equipment, and Steel.
^*TT,3i prospectus on Group Securities;

Street' in¬

vestor.

"The

Thursday, July 18, 1946

13$ South La Salle Street
CHICAGO 3, ILLINOIS

Putnam

Fund

Distributors, Xno.

J50 State St., Boston
W

(&,

•

Volume
1

developihent '.and exf affordtocarrytheirclaims'tothe

-There

several rea- ■courts..:;.';;

are

of/heavjr
corporate

difficulty .than large
well-known businesses itt 'dbtainf

taxes, small businesses

ing capital from' outside sources, adopt the proprietorship form of
capital as is.ob? organization, thus losing the ben¬
tained is at a relatively high cost efits of the corporate form.
- j
In view of these
Traditionallyj
email
busnessesl
considerations,
have secured much capital from it. wouldj seem that to achieve a
well-to-do individuals, but for a tax system that is neutral as bevariety of reasons, not: the least tween small businesses and large
of which is taxation, this source businesses certain
special tax pro¬
has dwindled. Thus, the taxation visions for
small
business
are
and such outside

jH.-;

V-' V

"\-g

••

'A'

*<t^'

•

Mil

i?V

'•V to&trf-.
'l*$&*%<*,'«•'

of income

needed.

when imposed at uni¬
rates on
both
small
and

form

large
enterprises
restrains
the
growth of small firms more than
that of

order to provide small busi¬
with a dependable source of

ness

capital, taxes on them must be low
enough to make possible a con¬

large.

Anyone interested
in a detailed development of this
point should read the interesting

siderable

reinvestment

earn¬

ings.

This would clearly call for
graduation of corporate rates.

little book by Professors J. Keith
Butters and John Lintner entitled

Effect of Federal Taxes on Grow¬
ing Enterprises (Graduate School

graduation/
extended
above the present limit of $50,000
of net income.
A business with
$50,000 of income is one having

of Business Administration.
vard

Har¬

University, Boston, 1945).

has

perhaps
It has

Fluctuating Earnings of Small
Business

Second,

the

been

argued
should be

earnings

to year, more than those of
big businesses. This is due to a
number of factors, among others
year

that small businesses are less di¬

versified in their operations and
thus more affected by ups-and-

that

the

half-million of capital.

been shown rather conclu¬

sively that

of small
businesses tend to fluctuate from

business

size does not have

even

ready

of this

access

outside

sources of funds. Not until
it reaches at least the million
dol¬

lar

class, equivalent of perhaps
$100,000 of annual income, is it
able

to stand on its own feet in
the capital market.

thing' \o« be ehcouraged to enjoy stepped
v;

I.......

•.

up so that the income sub¬
tipn of rates in"the lower brackets
ject to taxation during this period Would
ptot.dceasion. a serious loss

the benefits of the corporate form:

would be reduced:

System of Graduated Tax Rates
f

lower

In view of the

tax

liability in the early
However,, the extension of l the
-^.iUtogethe^tfresePv^^
years of the life of such assets, the loss
eai^yH£orwardt:te
brents regarding corporate rate^ chances of
recovering the capital yeafrs* And ^Ihe allowance
of ac¬
would caU^otv a system of :gradiU invested in them would be in*
celerated depreciatiQnV' if- made
ated rates: ranging from perhaps Creased- TMs would
reduce the available
to businesses: both- large
10 or 15% \ to lhe: stahdard
;to|p risk involved' in new investments* and small, would be
costly, A gen¬
bracket rate (now 38%),.for elim-s and at the same time: would- en*
erous carry-forward
might'cost; as
ination of the notch; and possibly hance the financial and credit
po¬ much
billion per year ;(der £
for the partnership, option; ?
sition of the investing enterprises.
i
pending*m
In order to offset the disadvan¬
To summarize, the most: fre¬ and
a
.moderately - liberal plan; of
tage to small businesses due to the quently advocated program for
accelerated: * "depreciation
might
irregularity of their incomes, the small business includes the fol¬ also
cost as; much
as, $1 billion for'
carry-over of losses over a long lowing: (1) a revised schedule of
.

period of years, and perhaps the

graduated rates,

averaging of income

ship option, (3)

are V clearly

needed.

several

During the war, the car¬
ry-forward
and
carry-back
of

rated depreciation.

losses

and

unused

excess profits
possible the com¬

credits has made

putation

ward

income

over

period. Under these provi¬
sions, businesses have been able
to charge losses incident to con¬
and

reconversion

wartime

income

wartime

rates.

against
subject to high
Congress has al¬

ready repealed the carry-back of
excess profits credits, ef¬

connection with
revisions of the tax system which
in

desirable from the point ot

view of

particular group of tax¬
payers, the question of revenue
effects must be considered.
We
are told that the post-war budget

length¬

It seems to me that in the
interest of small
business, and of
all business having irregular in¬

the period of loss carry¬
should be lengthened to

always

seem

ened.

the

much

seems

to me

forward

the

question

arises

the

re¬

warranf

higher

corporate

rates

that

revenue

irregular, invest¬
especially risky, and capital

There is fairly wide agree¬
ment among tax students that the
loss
carry-back
should
be
re¬
pealed and that the period of

losses,

whether the need for these
forms is great enough to

whom income is

Question of Government Revenue

open.

In view of the
possible revenue

would be required to offset their

hard to get from outside sources.

fective at the end of this year, but
the future status of the loss
carry¬
back and carry-forward is still

come,

enues.

business but would be of special
benefit to smaller enterprises for
ment

unused

carry-forward should be

celeration had been fully assimi¬
lated, it would not affect rev¬

The first two

these, revised graduation and
partnership option, would be
applicable only to smaller com¬
panies but the last two, the carry¬
forward and accelerated depreci¬
ation, would be applicable to all

year

version

the

five-

years '• after' its .introductioii; though ultimiatelyj' when ac¬

(2) the partner¬

a long carry-for¬
losses, and (4) accele¬

Government

Federal

$25

may

billions.

that to balance this

effects,

Or to put it

other way, would
the

standard

an¬

reduction of

corporate

rate

bility

business.

While varia¬

preferable to the adoption of
special

benefits

for

small

business? ;

I leave these
questions to you.

Many other suggestions for aid¬
ing small businesses through tax¬
ation have been made.

ple,

tax

early

exemption

For

exam¬

during

the

years in the life of new en¬

terprises deduction of the cost of

budget in prosperous years will
require revenue from the corpora¬
tion income tax of at least $8 bil¬
lions. Therefore, reform propos¬

capital

which

the

face

risks

launching and establishing
undertakings,
developing
products

new

and

to be more severe for small busi¬

Income Taxes Increase Risks in
Small Business

Third, the taxation of income
tends to increase the riskiness of
businesses

large.'

A
tax
whether levied

than that of

net

on
on

income,

small

large business, directly impairs
the prospective return from
any
investment. By means of the
tax, the Treasury stands ready to
share any prospective income, but
new

not

Thus,

the

prospective

tax

the

has

losses.

effect

loading the dice against risk-tak¬
ing unless the taxpayer can find
ways of offsetting losses against
income

from

happens

other

the
would

the

top

bracket
approach
the
maximum
rate ^of 38%, as the income
in¬
creased .toward the upper limit of

$50,000.

The

notch,

other

words, eliminates any graduation
with respect to corporate incomes
in excess of $50,000, but in so do¬

than for big ones.

nesses

effective rate applicable to income

markets, and ex¬
panding their existing operations.
As a result, taxes on
earnings tend

small

Inequity of the "Notch Provision"

sources.

that

large, well-estab¬
lished businesses often have rela¬

rate

Another provision which woulc

apply to all business but woulc
benefit small and

that many small businesses

are

penalize

assured
to offset

risk from

income

investment by a
large company may be virtually
a

unaffected
whereas for

new

by
a

income

small

new

tax,
com¬

the risk will be greatly in¬
creased by the tax. It is true that
pany

the

present carry-over of losses
mitigates this problem, but by no
it.

means removes

Fourth, small companies usu¬
ally operate under conditions of
intense
competition.
Therefore,
their

control

over

price is so
seldom able to
shift any substantial portion of
the taxes levied on them, except

slight

•

are

possibly in the very long run.
Larger companies, on the other
hand

they

over

often
their

have

markets,

and

•

would

case

chain stores.

involve

All of these

technical

corporate revenues are ordinarily

culty that,

lerived from corporations

could be shown to be
necessary or

than

less

having

million.
a

reduc-

even

justifiable, it

the

would

THIS

UNDER

FOR SALE.

their

CIRCUMSTANCES TO

OR AS AN

SUCH

OFFER TO

CONSTRUED AS AN OFFERING OF THESE
SECURITIES

BUY. OR AS A SOLICITATION OF AN

OFFER

BUY

ANY OF

SECURITIES. THE OFFER IS MADE ONLY BY MEANS OF THE
PROSPECTUS.

eliminated, then graduation

150,000 SHARES

under the individual income

Koppers

tax.

Moreover,
it
has
been
fre¬
quently asserted that the begin¬
ning rate of 21% places the small
corporation at

compared
with
rated business.

disadvantage

Company,

inc.

Cumulative Preferred Stock, 4% Series

the

PARTICULARLY

COMPANY'S
BEING

SET

OUTSTANDING

OFFERED

THE

FORTH

OPPORTUNITY

TIME ON JULY 24

THE

CUMULATIVE

PROSPECTUS.

PREFERRED

UNTIL

HOLDERS

STOCK,

EASTERN

A%%

THE

SERIES,

ARE

DAYUGH1

SAVING

1946, TO EXCHANGE THEIR SHARES OF SUCH STOCK

FOR SHARES OF THE CUMULATIVE PREFERRED
STOCK,

the

question of the first
bracket rate, there are
many who
contend that this rate should be

4% SERIES, ON A SHARE FOR SHARE BASIS.

equal to the first bracket rate un¬
der the individual income tax. I
confess

that

have

great

PRICE

diffi¬

$107.75

PLUS

ACCRUED

DIVIDENDS

culty in seeing the logic of this.

First, it

seems

to overlook

the fact that the first-bracket in¬

dividual

rate

applies

only

COPIES

THE

PROSPECTUS

MAY

after

personal exemptions, whereas the

corporate

rate

ately without
ond, it

applies

any

seems

SECURITIES

overlook

the extent paid out

well

the corporate tax.

Third, it is based
that

SUCH

COMFLIANCE

RESPECTIVE

the premise

*■;'

THE

WITH

UNDERSIGNED

THE

STATES.

HARRIMAN

rtlPLEY & Co.

INCORPORATED

blyth & CO., inc.

;
■

Lazard Freres &

S-

Co.

Stone & Webster Securities Corporation

ft?-..

unsound

LAWS OF THE

ONLY
IN

The First Boston Corporation

dividends—

subject to the individual income
as

FROM

SECURITIES

■

•

tax

OBTAINED

Mellon Securities Corporation

the fact that corporate income—to
as

immedi¬

exemption. Sec¬
me

MAY

LEGALLY OFFER THESE

-4.

•

Union Securities Corporation
ft

•'•••

•

JULY

15. 1946

t:;

W* C. Langley 8t Co.
.......

ft'

proposals

doubtful

whether they should be
adopted.

.IIUIUIUIIIHUI

is unfair to

and

about 14% of total practical problems of such diffi¬

issets

asset

encourage
Fifth, small businesses,: unable
to afford expensive legal and ac- the incorporation of small busi¬
counting advice, find difficulty in nesses, whereas, one might argue
interpreting complex t^x law ana that ^smaller- firms ought it any¬

durin;

under the corporation tax would
be effective regardless of the size
of the income just as is now the

may

sometimes be able to pass along
to customers or workers part or
all of their income tax burden.
-

;

control

proposals

This is indicated by the

Thus, it is probable that

unincorpo¬
Accordingly, it is
againstargued
either
that
the
which
beginning
any losses that
rate should be reduced to
perhaps
may result from a particular cap¬
10 or la%| or that
corporations
ital expansion, whereas .an undiversified small or new business should beVjgranted the privilege
under certain conditions
can seldom hope to offset a loss
o£ biing
against other income. Thus, the taxed as partnerships, or botii.

tively

s c

pensive.

the early years of the life of
an:

growth by taxing
any increase in income at the rate
of 53%.
If the notch provision
were

this-

depreciation

such

newly-acquired

bracket, and they quite

naturally feel that it

Under

for

graduation and the partner¬
ship option would not be very ex¬

fact that only

particularly is accelerated depre¬
ciation.

charges

ing imposes a rate of 53% on the
portion of net income between
$25,000 and $50,000. It happens
the 53%

businesser

new

plant expansion by : nevr busi¬
at least 7 years and
preferably
It
has
also
nesses, tax benefits to companies
been
frequently more.
earnings characterizes
out
that
which finance small
the- present
corporate enterprise in general pointed
The averaging on income pres¬
businesses,
"notch
and
provision" is highly in¬ ents
particularly certain indus¬
difficult technical problems,, als, however attractive, must be and tax credits for equity invest¬
tries, such as those engaged in the equitable. This notch arrangement but should be
ment
in
small businesses
subjected to careful appraised in terms of financial re*
special
production of capital goods, it is involves a tax of 53% on the in¬
quirements.
study and public discussion.
taxes on
monopoly profit, and spe¬
especially noticeable among the come bracket $25,000 to $50,000.
Apparently, a revision of the cial taxes on
smaller corporations with limited It was instituted in order that the Effect of Accelerated Depreciation
multiple operations
downs of

■

■iymi

...

sons»fop:$hi^^^^
counter

■

regulations. Thus, they- often un¬
rates; not at present rates, t\ •,? v wittinglyoverpay their :iaxes,
First, and perhaps most- impor- .Moreover, in" cases oft controversy
tant, small businesses ' are pecuf with ^r®vonue^ ag^^;>smau;'::bhsi^
liarly dependent; updn^
•$ess«^
* -present
vestment of earnings- as a .source their case& ^
pansion.

!'r

THE COMMERCIAL & FINANCIAL
CHRONICLE

Notice,

of funds^ for
•

•

361

•*,,J *-!■"'.

tatesi-y

•

-Nlimber 4508

164

'fV**

IfMIIC

lb,

•

Securities Salesman's Corner

Thursday, July 18, 1946

FINANCIAL CHRONICLE

THE COMMERCIAL &

362

(Continued from page 334)

nuclear countries may, and
prob¬

relating to restrictive business
practices;
(d)
International agreement
relating
to
intergovernmental
commodity arrangements;
■ ■ r

the ably will, at the same time wit¬
Council Of ness
negotiations
between
the
Fund and United States and 15 of the other

The others of course include

Most good salesmen

depression

and

United

exhilaration.

There

times when

are

the

Nations,

countries and between each
other,
for ihe reduction of tariffs and
other trade barriers. The Admin¬

International Labor Of¬
feel like fice, the United Nations' .Educa¬

subject to alternate periods of mental

are

Social

and

Economic

By JOHN BUTTON

you

Bank, the

periods when they feel emotionally high and low.

perience in living

try to

optimism and pessimism.
nearly all of

and

other they come back to

to ourselves, "why in the world do we

say

feel this way?"
v

medical

relationship between
state.

to follow

take

day

things

whatever

be doing, if

may

you

if it is difficult to get going and an effort

worry,

through, CHECK UP ON YOUR HEALTH.

rest.

the

proven

beginning to look blue to you, if

are

concentrate upon

starting to

you are

definitely

has

low physical condition and a depressed mental

If you find that

you are unable to

research

Eat well and build up.

you are

tired

Sometimes this only requires a

two before you begin to feel like yourself again; other times

longer rest is

Anyone who keeps

necessary.

have overtaxed their

going when they

after

scheduled

now

false

many

all

this

such

and history. Essentially, it,
without saying, the prime

goes

this direction

mover

with infant in¬
will re¬
ence on
Trade and Employment port its recommendations to a sub¬
sequent session of ECOSOC, iriin the fall of 1947.
cluding its recommendations as to
the place and date of the world
Delays

.raders.

Hot

Govern¬

opportunity-^

every,

Woods,, at. Atlantic City,

Springs,

at Chicago—the
Government
has

United

States

pushed

persistently for a return

Policy of the Administration

issuing

until

best influence toward

can

be accomplished by a tired body.

and

When you are rested you will notice that many of the thoughts

tion

that bothered you
you

when

tired,

were

you

have the physical well-being that

longer

with

goes

annoy

you.

strong, rested body,

lasting

assurance

parts

National

single program.
The
Advisory
Council,
of
State,

Secretaries

the

which

men¬

policies

financial

and

trade

international

its

regards

tioned,

peace

reasonable

Adminis.ration,

The

the

physical stamina and their quotierit international trading without favor
Seeing such a non-disr Secondly, nothing conclusive could
of nervous energy, is only putting an added strain on his system, that or fear.
be arranged or even started with
criminatory
open
system as the
will eventually weaken the major organs of his body.
the British while ihere was not
No good work
of

reserves

conference.

trade

conclusion of the financial agree¬
ment of that month with the UK.

system

multilateral

tarried

its December invitation

The Committee

dustries.

There have been several causes
the delays to date.
First, the

Administration

towards if not entirely to the oldfashioned

ation to countries

holding of the

world-wide International Confer¬

ment, with the support of foreign
at Bretton

the
im¬
portant to note, is requested by
ECOSOC to give special consider¬
considering these points

Preparatory Committee, it is

have intervened, the way

will be open to the

all along

American

the

been

has

accomplished by nex>
without
further
delays

ITO,

probably ..seems .confusing
view of their divided sponsor¬ spring,

starts

ship

Competent

15 pairs of trade agree¬
ments, but rather a simultaneous
multilateral trade, agreement. If

of trade discussion's

series

The

duce not

tion, the FAO, etc.

these alternate EXTREMES of

overcome

Yet somehow

As we gain ex¬

(e) Establishment

specialized agency of the
United Nations, having respon¬
sibilities in the fields of (b),

tional, Scientific and Cultural Or¬
■■going out and conquering the world—there' are other days when the
ganization, the Provisional Inter¬ istration's aim is through such
World may look like it is going to conquer you.
Most people have national Civil Aviation Organiza¬ simultaneous negotiations to pro¬

Treasury and Comffterce are mem¬
bers along with two others, in giv¬

that the Conr

prosperity, the Administra¬
gress would approve the British
has persuaded the Congress
ing the green light to proposed
loan.
The Administration in isr
country to set aside bil¬
foreign loans by the Export-Im¬
of dollars for foreign loans suing its December invitation to port Bank and other government

the

and

lions

credits, largely on the grounds
to do so is necessary, if we

and

countries had in mind

meet¬

agencies is guided by an underStanding that no foreign loans will
persuade the trading coun¬
be approved until the foreign gov¬
the world" is literally a true expression of the way you can feel when tries to scrap bilateralism and re¬ preparation, since trade agreemen
ernments agree to an exchange of
concessions have to be made on a
move the more serious barriers to
notes on commercial
policy.
In
your body is strong and your mind is clear.
selective basis, and the countries
Mental strength and
a
full and healthy international
the cases of the important British
were
slow
in
getting
ready.
Then,
physical strength go together.
commerce.
These considerations
and French agreements, adherence
with this an election year in the
There are helpful ways of overcoming mental depression be¬ were prominently present in the
to
this
country's official trade
United States, it appears that all
sides building up physical stamina.
philosophy was made part of the
Remember that nearly every¬ negotiation of the large loans to chance of
having
the
mee.ing
until
the United Kingdom and France,
official
announcements.
Among
body feels low once in a while.: Remember that the things that all of
after that event disappeared; for

you won't have time to let
out and

doing things.

things

worry

you—you'll be too busy going

The saying, "I feel like going out and licking

that

ing

are

the

such

spring of 1946.
But
meeting requires much

and featured the press

worried about

up to
a

it,

will.

man

even

the most

when

Concentrate

you

are

work,

your

from

happened.

feel physically

you

not mentally up to par—go to work with

going to sell, and

nature and of worry

be done.

never

you are

your

erase

rhind.

the next interview,

all thoughts of
It isn't

the

pessimistic

to do, but this

easy

it this way, ERASE ALL

obviously

un¬

Forthcoming ITO

The

with

Meeting

The earliest of the invitations on

international

coming

the

which

the

upon

the negotiation of tariff re¬

from

Washington that tariff nego¬
are to be started will not

He advises

Think of
best

THOlfGHTS OF FAILURE > FROM YOUR

unparalleled economic
and our position in
world
trade demand that the
United States take the lead iri
an
effort to put the trade of
;he world back on a healthy
basis.
Great Britain, leader of
the international trading area in
"Our

tiations

until

come

Nov.

about

strength

the

not failure.

success

day's work that

you

Think of

Success will

by working

to you if you believe in

come

health is up to par.

Remember

no man

has

by life itself, who refused to quit.

success.

You

can

only do

your

ever

best when

you

to fail, and

feel

diligently and
take

yourself, and

your

been licked by any

Courage is the sine

with confidence in your own
ability to succeed.

possible for

all

cheerfully than ever—refuse to admit failure—and

time.

Job,

going out and doing the

accomplish.

can

low at times—shake off the blues
more

trade
from

form of

approach

Act

if it

50%

the

from

Jan.

quo.
The procedure became
familiar to American businessmen
pro

With

1930s.

in the

view to con¬

ducting this type of tariff reduc¬
tions with a minimum of delay,

job

the U. S. Government last Decem-

your
were

im¬

your mind will work
better and your efforts will meet with
greater success, because you
will be thinking in a positive manner that will
bring about the best
abilities that you can offer.

Lipe-Rollway Corporation
Convertible $1

1945, levels. This usually is done
by
bilateral
arrangement wi h
other countries on a basis of quid

qua non

will find that

you

much

Preferred Stock

invited

3er

countries to

mee„

dual

purpose of drafting
tentative charter of an ITO and

for

the

simultaneously negotiate spe¬
cific reductions of trade barriers

given

the Committee for Reciprocity In¬

prepared to assume
partnership with us in this
high enterprise provided we can
assist her throughout the next

formation.

critical

held

hearings

quires
a

the world, is
full

opportunity to prepare for the

that

month

Washington

Decency

least

by
re¬

Committee take

this
so

a<.

to study the results

the 16 countries concerned.
That meeting is still
o be held,
for reasons given below.

Circular

request

with

the United

meetings with the 15 invi ed coun¬
tries. All this points, at this writ¬

consider

ing, to next March as the time of
the actual negotiations for mutual

policy.

trade

concessions.

While all
ress

.his

spells slow prog¬

toward the trade aims of the

Herrick,Waddell

Co., INC

55 LIBERTY STREET, NEW YORK 5, N. Y.

American

Fruit

the

De¬

The

did

invitation

American

cember, but not
ECOSOC

Thus, it took
purposes of

two

the other.

resolution

constituted

Growers

Inc., Com.

conference.

which

the

preparing

above-men¬

ber.

This is the Committee

meets

London

Octo¬

It includes all the countries

whose

FuIIerton Oil

Co., Com.

meeting the American in¬
vitation of December encompassed,

plus three others: Chile, Lebanon
Norway. After several weeks
of palaver in London, the dele¬
gates will return to their respec¬
tive home offices. Then, probably
in the spring of 1947, representa¬
tives of these same 19 "nuclear"
and

Wagenseller S Durst, ha
Angeles Stock Exchange

626 SO. SPRING ST.

TRINITY 3761

LOS ANGELES li

Teletype: LA 68
Marfot Quotations and Information

have."

Preparatory Commi.tee to elabor¬ tioned agenda in
London next
ate an annotated draft agenda, in¬
month, the Preparatory Commit¬
cluding a draft convention, for tee will be guided by sugges.ions
consideration by the general trade
which were made to it by Eco¬

Arden Farms Co., Pfd. & Com.

Members Los

not

all California SacnrlftMI

nomic and Social
ruary

econ¬

These suggestions

include:

between the two wars.

Our

Employment,
worked out for the
and

Trade

World

Expansion

for

Proposals
which were

Conference

World

forthcoming

Tr$de and Employment, . . .
represent what we believe to be
an

effective and realistic frame¬
for

concerted

interna¬

tional attack on the restrictions
and discriminations which

before

trade

world

bled

hob¬
the

war.

short, the lavish credits which
coun ry
has been extending
abroad are designed to clear the
In

this

to adoption of our multilateral
fair-field-and-no-favor trade phi¬

way

Time

losophy.

our

purpose.

will

alone

show

achieved this

loans

In Britain, where "Em¬

pire Preference" and "Buy British"
nave
long been popular slogans
and where bilateral exchange and

(a)
International agreement
relating to the achievement and
maintenance of high and stable

trade

employment and eco¬

there

levels of

the

Council last Feb¬ whether

basis of the Commit¬

tee's discussion.

is to become

trade

period

work

one

foreign

international

resolution ECOSOC made its own

over

to
economic

into a jungle in the

turned

general conference.

of peace, we an'd
other peace-loving nations must
forswear the use of the tactics
of economic nationalism which

part of 1946 to promote the lowing President Roosevelt's dev¬
production, exchange
and con¬ astating " message but which has
sumption of goods.
By the same never officially ended. "This time,"

officials, "we have had pro¬
longed
talks with the British.
French, Canadians and others and
an
immense amount of prepara¬
tion
which the 1933 conference

Kingdom. .
the
key

highway

omy

say

world

"If
a

Expectations of ITO Conference

entire

government, officials expect much
The Economic and Social Coun¬ greater success at the general trade
cil, however, during its London conference late in 1947 than at¬
meeting last February decided to tended the ill-fated London Eco¬
call an International Conference nomic Conference of 1933, a con¬
on Trade and Employment in the
ference which was adjourned fol¬

arrangements to prepare for that

financial agreement

the

pe¬

from war

To this end we have

peace.

our

four-year

reconversion

negotiated

hearings before announcing
holding of the simultaneous

latter

Class "A" Stock

three

riod

of the

among

that

ments

meetings are based sterns earliest. The announcement will
Congressional enactment last list the commodi.ies on which re¬
self-hypnosis wherein your own ima¬
gination is called upon to build; up in your mind, a feeling of success year of the Administration's trade ductions in our import duties are
agreements bill, giving the gov¬
and a sureness of
accomplishment, that will not countenance the least ernment the power to cut existing envisaged. Then comes a period
of about six weeks during which
hint of failure.
American
import duties by as the affected industries are
MIND.

s.ate-

Administration

countless

publicity attendant

philosophy is the
following excerpt from an address
ductions would become a promi¬
delivered
in
April by Assistant
nent issue in the elections.
Secretary of State Will Clayton:
Therefore
the
announcemen

those two countries.

can

One eminent psychologist who has studied this subject puts

agreements

the

veiling

announce¬

accompanied the

ments which

agreements
countries

Area

rule

rather

has

than

been

with Sterling-

have

become .the

the

exception,
deal of

great

countries will again get together

public debate as to how far the
British loan negotiators have com¬
(b) International agreement
relating to regulations, restric¬ mitted their coun.ry to the Amer¬

and try to agree on a draft

tions and discriminations

char¬

ing international

ter for an ITO.
That

second

nomic activi y;

meeting

of the

tr)

affect¬

trade;

International

agreement

ican

trade program.

The Dec. 6,

1945, joint statement of the
States

and- United

United

Kingdom

[Volume

164

Number 4508

THE COMMERCIAL & FINANCIAL
CHRONICLE

fSmef£ial P?licy.i>utalished along
ihff *inancial agreement,
TTh!fh/i
v" 5 government of the
United

Britons

Kingdom,

S£®

having

e A™erican

the

Bretton

Woods,

monetary program and to the loan

stated

and

accompanying trade understandings negotiated in 1945. As
we have
already suggested, those

refer-

document

reports

states:

"Rehioval

re-

strictions upon the movement of
^oods and services brought about
by the elimination or reduction

363

tial, these International Chamber

American

of Commerce members

agree.

Difficulties

report.

Ahead

discussions

successful

conclusion, in

this writing seems
unlikely, all
will be off
and our debtor
countries
presumably will feel
free to do
business in the un-

bets

tl\e views expressed
by other
Whether
the
last

Tds operl
put it
Us

American way.

an exit for the

^ no way of knowing,

view

Britain, in

cannot go

the

America's

end,

for the loari

t°

pte ling Area
one

ments

rin
do

giving

restrict the

the

port

rica,

would

own

With

that
be

icit

arrangements,

con¬

leaving

-3?
Sn

y only from

coun
espe-

3
7® are Physically unwh»,supp'y
a large quantity of
What
they
a

idea

crazy
a

can

,er 1947 by borrowing

completely
dia

It seems to
me

that

and

vague terms from

the

In¬

Crown Colonies."

To those who
feel that the Britgave this
government no firm
commitment to abandon
the sterIing-area system with
its
lsn

preference,
Keynes

part of Lord
speech will be of
interest

nheof,disaSreed
trade

world.

postwar

"Do the crit¬

really grasp the nature

of the
The alternative is
to

alternative?
,

that

s~
in this
Said Keynes:

^.d up a

which

separate economic bloc
excludes Canada and
con¬

sists of countries

to which

ready

al¬

owe more than
we can
pay
the basis of their
agreeing to
lend us
money they have not
got
and
buy only from us and
one
another goods we
are
unable to
supply. Frankly this is Tnot
such
a
caricature of these
proposals as
it may sound at
first." '
In Britain last
year the writer
discussed the trade
problem with

Conservative

Member

Par¬

liament who is
prominent for his
advocacy of Empire
preference.
A fair
summary of that position
is that
Empire

preference is de¬
sired not as an
absolute good, but
as preferable to
the uncertainties
of a multilateral
structure subject
to the
weakening forces of peri¬
odic American booms
and depres¬
sions.

That

Empire viewpoint, in

other words,
recognizing the dom¬

inant American influence
in world
economic affairs referred
to

by
Will Clayton in the above
quota¬

tion,

the

United
Kingdom, if
multilateral-trade world and
With its currency linked
firmly to

ill

sees

the dollar, doomed to suffer
de¬
pressions which otherwise may be
escaped. This very foal fear has
Underlain the opposition of marly

means

greater

imports

has

lip

American im¬

The

r St

our

those who fear

foreign loans

receive

the

ment's
..The

will

never

will

huge loans
More
that

and

trade

"Proposals."

COnsent

inspection.
the less, the United States

jJone
Associates

of
,

the

International

that
chamber of Commerce feel that

country which does not
consent should

membership

not be

the

give this

eligible for

International

teral-

can

goods,

recognition of this the
pub¬
of
high officials

"catered1 to^the^in-

terest in exoort
markets and exThe latest
example of

port jobs.

Financing

Foreign Trade. This
particular
committee is said to owe
to

its

Mr.

the

tion,

life

Charles J.
Symington of
Symington-Gould Coroora-

manufacturers of
equipment and other
surplus

That the
not

productive

ca¬

basis

agreed

which

all escape clauses may be invoked.
recommend that the confer¬

consider

impose
tion

upon

measures

which will

all escape

na;ions

omy

through

clearing agreements
trade
at

principles

with

premised

them,"

arrived

instead

on trade matters sub¬
mitted by member governments.
Also implicit in the "Proposals" is
the ITO's function of supervising

the

United

bulk

States

Associates

are

Suppose that in the coming trade
"confabs" we get what we are
after: reductions of trade barriers
and

from

there?
If the score of bil¬
lions of taxpayers' and private investors' dollars which we have

been

sending
to

out

abroad

ideals

ance of our

down

prove

in further¬
not to turn

are

payments

must

for

made

homecoming.

their

gradual

An American trade

equiva¬

may mean

greater world-trade pie for all
But only American con¬

cessions greater than those

ob¬

tain

any

from

foreigners,

buying and selling by gov-'1 rate larger American imports of
commissions; monopolies, goods and services than our ex¬

ernment

like that of tobacco in France; and

ports, will make the entire effort

complete State control of produc¬

good business.

the

two

committee

ffiar

that

reader

the

reports

the

difficulties

this

postwar

wui

during

transitional

USed

nothing

period

excuse

with

for

regard

tion and

United States Associates be-

Heve that each country participat-

distribution,

all of them

as in

This is

Russia

rocky realities in the

tion

path of international trade agree¬

entail

ment—as

our

well

international

business agreements,

private and

public, which restrict competition.
businessman's

the

mental

history of

notes

group

matter for the atten¬

the

businessman.

far-reaching

international

sition.
ment

The

nexf
nexi

jin

vear's
year's

conference should

controls

to
at

Possible.

clear

minimize
the

The

trade

help lessen this

danger by making
mitment

world

all

earliest

trade

one

Commerce

"The

need

economy

commodity agreements is

exports

unbroken

excess

and

jects the idea that there should be
double standard for private and

com¬

trade

public international business

moment

agreement

re¬

tices.
part

therefore

the

prac¬

criticizes that

government's

change

one

cferted policy

And a con-

door

the

despite

continuance

some

restrictive practices.

national

Trade

will

This advertisement appears as a matter

buy

While

the

changeover

the nation's

made,

sudden
mean

Inter¬

Organization

the

one,

occurs

cease

"prosperity"

International Cham¬

this

year, one on trade
policies
to be
sought during the transition

from

a
war
to
and the other

peace

Reeves

circumstances to be
to

United

States

strongly

the

proposals to

ference and

Associates
submittal

that
on

Common Stock

endorse
of

the

($.50 Par Value)

those

international

urge

national Conference

con¬

Inter¬

Trade and

Employment be held
date.
a

Brothers, Inc.

economy

analyzing and com¬
menting on the Government's Pro¬
posals for the Expansion of World
Trade
and
Employment.
The

at an early
International agreement on

multilateral trade pattern is

Price

$26.50

per

es¬

sential, these American business¬
men

say,

expressing their

concern

the bilateral clearing agree¬
ments which have
spread so dur¬
over

ing the last
with

which

decade.
an

"The

derstanding is reached
mine

large

speed

international

part

may

be obtained in

any

State from such

of the several Underwriters, including the undersigned,
as

may

lawfully offer the securities in such State.

un¬

will deter¬

whether

the

postwar trade pattern will become

adjusted to existing restraints."

Furthermore, the United

States

Associates pay special attention to
the

Copies of the Prospectus

place of State trading in a
"multilateral" world.; One of their

Lehman Brothers

Commercial Investment Trust
Incorporated

periodic

383,819 Shares

Its Council has
committee reports

two

will

their reliance

through

splurges of foreign lending.

of record only and is under

ex¬

that export interests prob¬

offering of these securities for sale, or as a solicitation of an offer
of such securities. The offering is made only by the Prospectus.

Commerce.

will

Department

„

Even

bigger slice, is a view shared
by American businessmen
as rep¬
by the United States As¬

approved

being

economy

have to adjust itself.

as an

any

probably

between 1955 and I960.

come

ably must

That there should be

of creditor nations

to increase their imports is essen-

supporting

though,

general objective, leave open the

should be retained-

excess

pects, the change should not be

with

minimum of escape clauses.

imports

their

"Proposals"

from

over

supporting

trade

should contain specific conditions

which,

Depart¬

puts it plainly when it says:

intergovern¬

failure

commercial po¬

.■

ing
ine

will

change

resented

sociates of the
ber of

ah elusive Utopia some provision

re¬

greater world-wide exchange of goods. Where do we go
a

sorting to compromise provisions.

the execution and administration
of agreements to be made.

to share.

Also the subject of attention by

econ-

bilateral

clauses with appro¬

•
<

complaints

the ITO the obliga¬ j concession balanced by
the application
lent concession abroad

initiate trade with the State

ing as a channel for the distribution of information, and acting as
a forum to consider requests and

supervise

priate provision for arbitration."

open-economy nations should

Nations, the ITO will be generally
to discussion, the calling
conferences, serv-

of international

ence

"the

construed

bigger pie,

the

for

ICC

the United

"Bigger Pie"

goal

standards

need

the

ulti¬

pacity.
Goal

the

arm

railway

products

capital goods faced with
mate

suggests

*—

nessS thhddng'is' tee'
above-men" The feW6St P°SSib'! ^ C°ntr°1S
Committee for

tinned

the producers concerned'
from tariff reduction,

resulting

that

11 i 1

for

in j dry to

This

American

repeatedly

such

breaking down trade restrictions,

statements

have

als'), Which provides that coun¬
tries may take 'temporary action
to prevent sudden and widespread

The

suspicion

be best
ap¬
pealed to by the
prospect of great¬
er

exports
and in

Govern¬

the

supporters

benefit

States

specific commit¬
progressive elimi¬
nation of exchange controls and
import quotas. The escape clause
contained in Section B, Paragraph
3 (of the government's
'Propos¬

investments

than

m u

effective

United

inst-auoted reports recogRussia would be unlikely

"oing

Administration's

a sterling
preferences couid

area

ics

Empire

another

cake

overwhelming
majonty °f the
supporters of the

ahito

require.

fact is,
however
slices can be
had by
if the size
of the

fully repaid because

lic

Recently it
fashionable to give

persists

C?nn0t force these

The

exports.

possible.

def¬

...

thought

to reassure

of the

countries

dollar pool which
is
pool

there

or gold sur¬
India and South Af¬
prefer to make their

commerce

business.

signed

war-

concerned

Depart-

State trad¬
if other countries

operations

X"K^ Kuvernment

tinuing
such
an
arrangement
much longer
than that?
Indeed
plus, such

service

Pool]

whirlfIlfef
Which have is t?a,t these
dollar

"more
more

journal:

increased."
Foreign trade

become

away

voluntary

JnTeio^terS [of the dollar
of the
thf I'
BVt.what hoPe is
countries

world

pieces.

well

havpSn^ex
"0t yet got and
If
t y been entfusted to us.
ywill
be very satisfactory if we
can
maintain

Commerce

weekly

that larger
all traders

of bal-

use

Asssuusd*

area

at we undertake

I;to
not

we are

goal

are

the

The

will
then
be
freely
available for
expenditure in any
this t0 the
House of
Lords, the late Lord
Keynes, who had headed the
Brit¬
ish
negotiators here, said: "I
won-

"w macb

detailed inspection of

from

"Some
inclined to
believe that
they can obtain a
larger share of
foreign markets
\nly at the expense of
others.
The

current

sterling

countries

the

ing

trade

the

traders

is the

postponed.

frnnf
receipts from
transactions of all

ments

is a reahty, these A™er
businessmen report that it
wil1 be necessary to provide for

well

man

end the
so-called
dollar pool within
in exceptional

year,
unless
cases the date is

absence of

lcan

stated by Max
teweH1state/ZZne-'\Twe
idea nije thit
J. Wasser-

along with it.
One indisputable and
early con¬
cession
being granted by the Brit-

ifnnlrt
Undertaking

!rading

are

The U. S. Trade
Goal

obvious that if the Do¬
do not
subscribe to the

minions

the light

limited

°f the multitude of restrictions
Suggestive of some of the diffi¬
2£ 1by Proposals
for Considera¬ commercial arrangements can be v.'.may be nullified by the ac- culties which the coming world
tion
an
International Confer¬ carried to fruition at the
ence on Trade
coming tivities of the State in its trading trade meetings face is the follow¬
and
Employment," international trade conferences operations." State trading may be ing observation of the United
is m full
agreement on all im- only if a
majority of the people used as ,a weapon. Assurance is States Associates: "It seems
pprtant points in these
in Britain.and the
proposals
Dominions can heeded that concessions we make unrealsitic to expect that coun¬
fp,d
accepts
ihem as a basis for meanwhile be persuaded. Should t0 bring about multilateralism will tries like the United States, whose
international
discussion; and it the coming international confer- not be nullified by the operations principal restriction upon
imports
Will, in common with the
ences fail to
U S
produce multilateral
arises from tariffs, would make
State tradmg
Government, use its best endeav¬ agreement, a
i^rganlzaQ?rfo
substantial
tariff
reduction
in the
ors to
contingency which Recognizing that Russian State
bring such
at
of

members

Kam,

THE COMMERCIAL

,,■..';:.:IV"~" ~""~"w'" "
: • Thursday,juiy is, we ■
fMIS
rIIC6 Control and ...FiSCfll' #JWMrjr
PollCV _ _ * Wamst Satl
338>
aggravate- already existing short.,
inflaotineaPOn
on. I offainst - : •

jp^Mpspssspi "f ..i;:"^"!.......,.,

ably lost.

government will, of course,
authorized powers to
enforce the national stabilization
policy. But fiscal and monetary
devices are limited in their scope.
They must be buttressed by an
The

(Co
(Continued

J£°«^nu„e.d.!r?m pa?c
They

' I ages

have

production program.

of the things that industry

must have.

serious and irreplaceable

caused

period, may be
Must Be Administrable
defined as all price rises not nec' -4 workable price control law
essary, first, to compensate on an must be administrable. Obviously
industry-wide basis for increased a law that was admirable in its
— - — would
wvlWVVf still be
costs
of production, second, to every other feature
eliminate
the
unjust hardships
hardships «
a fraud if it were
«*iiiiuiare
tne unjust
a liability and a
which general price ceilings in- practioniin
«-«which
general
••
bv**1'1
aj- price
jfxxtc ceilings
ucunigs in„ unenforceable.
Jvr,

aggravate-already existing short¬ ing this

irom page -338)

Rapidly rising cost of living in¬
evitably results in the dissipation

losses of production. Shortages of
materials and components have

emergency

me
disputes of the incomes and savings of the
nonn1«
£
4-1— —'
*
a&d, even without tie-ups, would people for the purchase of food,
f,
>
in- practically
vc;u,U(,c.
necessities, evitably impose in some individNo
conceivable
have hampered the smooth accel¬ shelter,
and
other
inHiviriat.
eration of production.
leaving them unable to buy their ual businesses, or third, to stimu- agencv could set mi+

been aggravated by such

-J~:—
^

tauu

—.v

—

wxucu

iixgiivi

j..?L

auuve,

—JJ

xiivcsuuent.

^r—

«Q^SiaK Nation
prosperous
futureand towhich
whichit has
the
aspires
m +? l!n ^y
be every right to expect
MONETARY

—„

gue
us—and ter the first World War.
plague
ization
with
stabilization
with
There is pvptu evidence
adequate and sustained production

than

rather

/TIT-

emergency

and
Have made their decision in favor
of the continuance of adequate

FISCAL AND
POLICY

Without

—

forward
wcv»w
through
v!vi \Jiv
the
vice juna
final
ifb piion
stages of reconversion with effec¬
tive price and wage controls, or
whether we are prepared to take
j«.

•

abandoning such ti/H—
con1
when
supply and
demand still are radically out of

the risk of

law.

tected and they would soon come

turning. We have managed
things better this time, and our

to a

...

bittqrRealization of that truth, maintenance
only fair to tell them the evei7 cost

of price control. If

all

removed.

—

The Threat of Inflation

power-

„

r—w

must be such fiscal and
policies as:

WORKABLE PRICE CONTROL

the

vided

mnn

necessarv

for

control
to the

needed

it is

message

certainly have without adequate
price control—we are guaranteed

law must measure
ir-

•

Rapidly rising prices inevitably
bring demands for higher wages—
strikes—and interruption of the

Tt
Mncf r
*
i
It Must
Control

workable

must

work schedules.

mate

consumer

price

i> •
Prices

control

tax

and

Strict
control of
credit* expension.

private

as total demand

price adjustment tion calls for

single ad- /mw

actually to

able

control

It must

live

clear

ment

ecoZZ,

generating artificial shortages to!

hTlr*

^ h°Vers

"Unnecessary" price rises, dur-

nesc man

bv-case

ne«

nrnfit

nearly 20 000 individual price increases
already granted in 1946

for decontrol, ceilings have

been

•GREENVILLE

granted.
HARTSVfLLE

^CEOARTOMTW
ATIAHTA •

BIRMINGHAM

,ABAMA\*l""%WC0,

adjustments
under industry-wide price ceilings
add up to a tremendous adminisindividual

These

trative

labor,

but

they

nothing compared to the
alternative: the

GEORGIA

impossible task of

alterna-

millions of indiprice ceilings self-set by

tions of tens of

•MOULTRIE

vidual

VAIBOSTA#

separate

the Nation's half million

...

Members New York Stock

Exchange and
Leading Exchanges

that are in supply-demand balance- Decontrol, of course will
Proceed.at a« accelerated rate as
Production catches up with demand; but it is hard to see how it
pould.have proceeded much more
raPldly up to this time.
The Danger to Stabilization

not remove of workable price control;

prevent unnecessary price rises
duced output of needed products,
that it be administrable, that it be
It would defeat its own stabiliza- fair, that it be flexible. An externtne

BANKERS

products have been important
ones' but il is virtually impossible
to fmd important products today

^ then are (he essen(ia!s
To datehas focused
the movement
fot
that it] peati°n
conomy
the operof the civilianon executive
aSencie8-.
as elsewhere econ- ;
se^iarfufctionfis^ sfrabFe BTt
Adm?ntwV6' lhe °K fiCe 01 Price Si0"
0ne year °f thewith
°ffice
of i'tures
is worth
noting
that constitute"
expendU
Pricef0r
Administration
these
for this
purpose
to this requirement of essential powers is of crucial im- onlv sl'Shtly more than one-twenhas granted thousands
o
our reconversion
tt
ef- tlethu,°£
ro
total expendit"resp
No
Day^lfdeafu6
Tl VJ'
^ ^ P"SSeS' nOW'
or materialing with shortages, without a law on the books in- ally lessen the inflationary impact
stabilization creases the danger that our price of Federal expenditures upon the
direct ceiling structure will be shattered] ec°norfiic syste™- Mai°r econo/
ceilings. The subsidy
have so laboriously won h Proposed expenditures for pub- J
pr^:nntrz;
must

i
INVESTMENT

are

suggested

reviewing the continual

• ALBANY

Dend?tu^
sig- '
Sifieint flcfa?
f *' Jr' . . , u , .
.,(a^
\ budget, $5.5
billion, or about one-snxth, is for
contractual obligations (interest
and. rafunds) and is not subject to
variatlon(*>) Of the remainder, not far
from one half are anticipated expenditures by the War and Navy
Departments,
(c) The proposed expenditures
for the operation of the legisla¬
tive, judicial, and all non-war executive agencies total a little more *
nenditureslll0n °T °f
e*""

removed from tens of thousands
of individual items since VJ-Day
,
representing close to 15% by value ,
improved. Legitimate applications of all items which were under
for
adjustments
are
quickly control. Few of these decontrolled

designed to relieve hardship
cases. The speed with which these
increases are granted has steadily

were

CHATMHOOCA

re-examination of

create
such su-as stri
proposed
expendi
tures.expendi
But itnures,re&nutdpcml nvUl
T
i
t
tees
or
boards,
c
ti
n
g
Federal
ccessary
to carry- them great
carepublmust
be used
that notes^
^
„
senti
a
l
i
c
servi
c
es
are
L ^ ,lce of Price Administra- crippled.
ance TheC°Of^inpClhP°liCy+a?ist" In his BudSet message of last
slow'to raL nrW iitr
n January'
the expendi
Presidentturesestiduri
matnegd
move them entiroiv whl °r
that
Federal
SSSTOmfnSl
ai?JS Jl-51S
-COndl
" lfiscal
d totalng$35'months,
8 bU"
more than 600
y®ar
ions* 1947
Duribetween
nwoul
g hassucceedi
J00 that
wardestibymate
anded15%,
inereasp^ hai5try-wide. . price
been10 scal
upThe
V X^
{J1! comihoditie^'have
second quarter. I sions
mainlyinbecause
™ ehrflllarb
conol^lary mr+iii4
M this rale-wthat
toces ^^asic
estimatesof ofupward
Armyrevi
and- ,.
mnJ
"S1I riseil ^.t^ rate of one percent a Navy expenditures, expansion of ?
orwJr! must be guarded against month since February, and whole- veterans' programs, legislation
haSf i\raCA°no0.n a £as®" Saie .prices haye increased some- providing for increased military
rfpSf L if? *C'
iTtai "Jw* • s not aPPear and civilian government wages
ht
of fair llkelJ that prices could be al- and salaries, and deferral into
by our stabilization pro- lowed to increase much faster than 1947 of some items earlier exZlfi' VcSZ- P.r°P°rt on .of
this
endangering
to appearofin Droiected
1946. exwhole without
stabilization
program.- our
As pected
Fxamination

law

the Governauthority, to prevent
inevitably bring competitive and all
unnecessary
price
rises while
j ^
preemptive buying, inventory ac- the inflationary threat hovers
CUmulaton and speculation, thus over
the economy.
over the
prices.

Rapidly rising costs of materials

Other

Anti-inflationary
policies.

debt

■

would be on the

feceivmg end of every

that he hwndies^
thnt

ements.

minimum
,

TAllADEGA

ditures.
2.

Federal expenditures. So long
is excessive, Federal expenditures, like other expenditures, contribute to the in¬
flationarv pressure. Federal exIt Must Be Flexible
nenditures have declined sharply
A workable price control law since VJ-Day; that decline has remust be flexible. Neither the up- leased men and facilities to proward adjustment of specific ceil- duce for the private market. It is
ward
ndfaict'th^
mo>n*
limnnrtnnt
cfBCUforUICthe
X1that the ndeeline conings nor
iLal fC^!c
the
final
decontrol ",*ofJ~ duce
specific cnmmnliltfL decontrol of important

Justment that was made anyf
where. Such a system would be
reconsideration nf
* y the negation of price control—1 e^Sides' and
ga*zed inflation.
Congress'has thrnw? hfS?C
Th? Prim^y aim of price coru.
light
the true nature of l™1 is~Tand must inevitably be—
price control—what it is and what !! Protect the living costs of the
not. As his
clearly ^urner and the operating costs
states,
workable price coS °J ^e producer, not to guarantee
to certain " flfed. P^ce-by-piece profit to
requirements
requirements.
f?e business man on every item
ua

The Presidents

rials, and markets. Under rapidly
rising prices —which we would

monetary

Curtailment of public expen¬

made.

would be both costly
irretrievable.

and

of these necessities—labor, mate¬

n]S
back.
at this time

% materials at foreseeable cost, and
■ian assured market for the orodj wets of industry. Under stabilized
prices we are guaranteed all three

GA0SD1H

the

present abnormal
conditions. But if price control is
in effect, it can be aided power¬
in
effect, it can be aided
fully by other weapons aimed
under

now—now,

sion

repeatedly that inflation can in¬
terrupt the sustained high volume
of- production which is the Na¬
tion's basic need. Steadily rising
and sustained production requires:
m assured supply of labor at fore¬
seeable cost, an assured supply of

AHNIS10N*

would

when the deciFrom this
crossroads there will be no turn-

facts

have warned

OECATUR

other

control,

anu
xatxxi
Privthe
ate
that
declmore
ine conleaislafpd
T2
sa^el
y
be
tinue,
in
order
that
men .
1JJcreased cost of producing a sin- supvlu-dcmn^
beca"se
the
may
be
rel
e
ased
to
produce
goods
g.e J33810 material, such as coal or relevant iartnve • tl0n.®.wd. other for the private market, and in or?teel' w°uld literally result in tries canJnf hI J^rv^fCl -l^dus~ der that during this period of exA mistake in direction hundreds
thousands throughout
of individ- ficient
cessi
veprivate
purchasiinmay
ng power
H?1 Price of
adjustments
hand itaccural nJi f • Su*~
notand Federal
y the industrial chain, and the ulti- tioLl
that thl
L? 6""?
desirableer expenditures
swell
comepresent
priundul
vatey
vniin^Z688
esta™lsh
expenditures.
The
situaour

facts now."

This Office and other agencies

none.

Thl8 principle of cost absorptlor? 1S utterly essential to the

economy. It must not favor producers at the expense of consumers or vice versa. It must not favot one producer or business man
at the expense of others.
jt js extremely undesirable that
cmcigcucy legislation
a
pjece of emergency legislation
written hv the Conf?res« <?hnnlH
written
wri7en by
*?y the
xne Congress
congress should
snouid
single
out individual interests
for
slnsle nnt
'
special treatment.
Such
favoritism
^^"oxxicxix. oucil lavOrillSm
is
un-American,
and
it
would
tend
|s un:American, and it would tend
to bring discredit upon the whole
stabilization program.

increase throughout
industrial structure were to
^
I
"U1
xxiuuamai
wereprice
to
It is necessary, in fact, to the fesult
Tesult ln rigidlysxruciure
equivalent
fnnn+i™,-r„r
J-I-x.
increases
*
--x
functioning
of
our
democratic
ln?reases> wo
we should have
not
system that the people have the Price control but price chaos. The

production has increased far more
rapidly under price controls than

government

workable price control
But they would not be pro-

•
1
- -by a
tected

wrong

xiiciv

crossroads and took the

were

re-

annrnvp

irt

UTJ>

11.
urn-

balance
oaiance.

controls

inflation

have recently

T>oTiiciricr

iw\ln r.4- .
Xl.
two
Is at a time

it. did after the last war when

economy

law

price

of the government
inadequate to stabilize

powers

the chain of supply. Even though must be fair. Any such law ac- fully by other weapons aimed
some costs rise in an industry, it ceptable to Americans must deal chiefly at reducing excessive dels
H P°881ble to maintain these? equitably with all segments of the mand. Dominant among thes

product-by-product ceilings m
relatively stable condition without
faced the danger that, while want- an^ inequity if other costs are
inn price control the people micfht
to permit generous
be given a law that paid only lip- Pr°fitsAlthough most business
service iq control.
meP roust. pay more for labor and
As the President cogently said
many
pay lessoverhead
in merrresiaeni t-ogenuy saiu chandizing
expenses;
thp
^llrtxiul'6i,is
refusing to approve the reh
,6 .expenses;
; , ti ' + overhead
voilimP
cOTtiv
comDleted
price control ra,ayibe
r.elatlon.to
v0. unae
■ntly
completed price
™ ill■ '°W
®
'
"
«If ^ttS hllf^L^aUowed to
of salls; orsuiTlcienT
pievlou»s flce
cellln?s
tn
on\rar
ir»
hp'omi
law
tho
Ameriran
TDeople
may,
be
sufftcie"'
to
cover
oecome,iaw, tne American people wh^le
in part the increa<fP !n
n
become
law,
tne
American
peupie
whole
or in par|; the increase in
would believe that they were pro- „_x_
™"°le 01 m pa" me increase in
But

threatens.

We stand at a crossroads;
we must
—wk,
(iuuhl
*
choose ftoiv
whether we shall

same

facts

these

understand

price control as long as

zation and to protect production.

After World War I, we came

and business men alike

conumers
—

'i But today, we are threatened
with the loss of the controls which
we have used to maintain stabili¬

move

that the

Ameri^nmo^e^helmjmUy^

through

controls.

to
to protect
protect cases
cases individually.
indivMnaii«.
the purchaser—whether he be the
ultimate consumer or a manufact
It Must Be Fair
turer, wholesaler, or retailer along
A workable price control
price
ceilings designed
designed
price ceilings

that

shortages

of- achieving

xne

AAXW

control measure

the
the Presi— type rrequested
-- by
the-type-requester
uy uie 4/UA

„

this

adequate price

"
"

] dent if we are to progress to the

t?]!?

WWVsilare
of the other products of in- late the production of badly pass lousiness
upon the nrnfit tnfn,? +
dustry. This inability to buy, com- needed short items, the lack of each business mJm
wnn me unwillingness to which is hampering the Nation's on
each separs
WIa
accomPbshment °f higher bined with the unwillingness to which is hampering the Nation's on each senarate Ue™
production, has overcome these pay unreasonable prices, causes a production effort or causing seri- handled during a period when
Bjbduction,
has overcome these
pay
unreasonable
prices,
effort oratcausing
see- curtailment
nnrfofi^nvi
^ markets.
*_-x_ Similarly,
-•causes
- - a production
obstacles. At the end of the secof
ous deprivations
homeserior costs were continuallyonly
rising
As
workond quarter, we stand in such a rapidly rising costs of construction abroad.
explained above the only workThe cornerstone of workable able price control method is to fix
position that we have the oppor- reduce business investment. The
The cornerstone of workable able price control method is to fix
tunity within the next year
vear of inevitable
inevifovo- result
—4«.
ice control is a system of stable product
prodnet ceilings on an industryis a sharp. deprice
Mj-piuuucu wxac uasis and ues
eliminating most of the war-born pression like that we
suffered af- industry-wide product-by-product
wide basis and deal with hardship
VV t DU
vigor of the economy
"
i'SL7'
Mu V"
the driye of the whole people ToBut the

all of its

use

incentive to produce;

if it re-

has been

mcreas-

stiation

ingly alert

UNDERWRITERS AND DISTRIBUTORS OF
INVESTMENT SECURITIES
BROKERS OF BONDS,

Private Wires

•

STOCKS, COMMODITIES

Home Office: Atlanta

•

Phone LD-159

its job and

^T
'^Sving"
*

nowever,
IS

often

price

the

cause

better

served

is an

u-e

ViVolume 164

THE COMMERCIAL S
FINANCIABr€HRONiCLE

Number 4508

;

lie works, an even smaller com¬ much be re-examined in the light
ponent of the total, have been of the present need for. anti-infla¬
sharply restricted. Nevertheless, tionary action.
in the present situation, some fur¬
We must not hamper the pres¬
ther economy may be possible in ent operations of the armed forces,
the public works programs.
wha are fulfilling international
Postponement of public works obligations essential to the ad¬

activity is important for two
of which

sons,

is that

one

rea¬

some

types of projects, notably the con¬
struction of buildings, require cri¬
tically
scarce
materials
which

vancement of

and

toward lasting
Economy may be
possible, however, without inter¬
fering with this function. Some¬
to

world

what

less

projects

subsistence,

deferrable.

However, this review
fraction

all

only
public

covers

Federal

works

projects. All non-structural
projects, and structural projects

the Army, the
Navy, and the
Veterans'
Administration
have
been excluded from the review.

However, in
uation,

inflationary sit¬

as at

present, the need for
postponement of public works ac¬
tivity is far deeper than the mere
prevention of competition for cer¬
tain specified scarce materials. In
some

three-fourths

than

fourth

are

be financed from

will

tures

appropriations,

of funds

war years.

are

bal¬

for the pay,

clothing,

and

one-

available

appropriated dur¬
Of these expendi¬

tures, two-fifths

travel,

new

than

the

out

ances

welfare

training,

military

three-fifths for other
purposes.
It is to be hoped not
only
that
many
expenditures
personnel;

which must be made

poned,

order

be post¬

can

relieve

their

inflationary pressure, but also that
the merger of the military and
naval
departments,
which
the
President

has

repeatedly

achieve

can

economies

urged,

the

elimination of duplicating expen¬
ditures.

The opportunity for economy in

flationary pressures by compel¬
ling the construction of added
houses or by necessitating exten¬

remaining classes of expenditures

of any sort will

is far

less.

curtailment

propose

of
the

public works will compete
directly
for
manpower
which

stimulate

Proposed

would

in
producing vitally needed materi¬
als. But even where neither sit¬
uation exists, in an economy in

security and payments into retire¬

which

ture

total

over-all

engaged

demand

exceeds

available

output, any in¬
expenditures increases

crease

inflationary
ects

pressures.

which

All

not

are

not

cally for

they compete
materials

scarce

works

all

what

Federal

programs

determination

that

be made

may

portions of

public

order

such

programs

are

accord

gram to increase the

when

expansion

public

activity will be desirable.

policy

sound

that

constructon

pensate
When

variations

public

activity should
far

riations

principle of fiscal

com¬

possible for

private

va¬

construction.

private

private
whole

construction and
business
acHvitv
as
a

are

high level, public

projects should be deferred as far
possible, in order that they may

be carried out at

time when the

private demand for labor is slack.
In this field, as in general gov¬
ernment, we must be careful in
curtailing
expenditures
not
to
cripple
vital
programs.
Some
projects must go ahead. Some are
urgent for the public health and
safety, or to prevent serious im¬
pairment of the necessary func¬

tioning of public agencies.
are

essential

output.

The

Others

to facilitate private
reduction
below

presently proposed levels cannot
be large in relation to the total
budget, because the proposed total

sult.

the

This

will

controlled

availability of goods, and

long

planning,

how¬

If
ary

impact

Federal

expendi¬

tures is to be

sought, expenditure

plans

Army and Navy—

the

45% of all proposed expenditures
other than interest and refunds—

securities is

by expanding
their loans. The
Federal Reserve System has al¬
ready taken one step which will
have some effect in discouraging
undue

the

credit

war

expansion.

it has

government, is

ward

tain

During

reasonable

stability

Federal bond market.

been

possible for
member banks of the Federal Re¬
serve System to borrow from Fed¬

On the

the
oc¬

casion

preferential discount rate,

the

approving

termination

This advertisement is neither

offer to sell nor

price control restrains

adequate

surge

sures,

the

inflationary

even

keel

of determined

effort must yet be

exerted, in order that we can be
certain of the outcome,

any

of these securities.

New Issue

July 11, 1946

36,000 Shares

Corporation

(An Illinois Corporation)

$2 Cumulative Convertible Preferred Stock
(Without Par Value)

(Plus accrued dividends, if

any,

able

from date of issue)

the goods desired are
not all loaned funds avail¬

for

spending in the United

Copies of the Prospectus may be obtained in any state in which this announcement is circulated

only from such of the several Underwriters

are

registered dealers in such state.

Tax and Debt Policy

The

i'Oii.

goal' of Federal ta$ policy

;

Glore* Forgan & Ecu;

mum

Federal debt, and by siphoning off
private income reduce the pres¬
sure

excess

fect

fiscal

demand.

In the ef¬

policy upon infla¬
tionary conditions, taxes are a
companion weapon to reduced ex¬
penditures.

tailing

Their

total

should

not

dollar's

cur¬

having been sold, this

announcement appears as a matter

NEW ISSUE

of record only.

July 11, 1946

power

Each
overlooked.
reduction of the current

deficit and
in

effect

purchasing

These securities

each

59,862 Shares*

dollar's increase

budget surplus, if one is at¬
tained, is a dollar's reduction in
a

inflationary

pressure.

Beatrice Foods Co.

The

Secretary of the Treasury
has expressed the hope, in which
I concur, that an excess of rev¬
enues

achieved,
out

expenditures

over

(Formerly Beatrice Creamery Company)

can

that debt reduction

current

revenues

3%% Cumulative Convertible Preferred Stock;

can

(of the

carried forward.

During the past
six months, the Federal debt has
been reduced, even though cur¬

rent

expenditures
of

excess

current

have
tax

been

the

of cash balances

use

accumulation

revenues

surplus

The

from

highly de¬

some

amount

Preferred

pectus.

55,911 shares

were

Stock pursuant to

subscribed for by holders of the Company's $4.25 Cumula¬

the exchange offer, since expired, described in

The remaining unsubscribed shares

were

possible extent,

the Pros¬

purchased by the Underwriters, severally,

and have been sold.

Copies of the Prospectus

may

be obtained in

any state

in which this announcement is circulated

as are

registered dealers in such state.

due, most will be replaced

by new issues.

Share)

part of the

public debt may be retired
comes

*Of this
tive

only from such of the several Underivriters

though

per

which will per¬

mit its continuation is

Even

value of $100

receipts.

This debt reduction has been pos¬
sible by

par

To the maximum

in this refinanc¬

ing, securities held by commercial

Glore, Forgan & Co.

for*

to; full

peadetimdpro^perity^A^^reabdeal

solicitation of an offer to buy

Price $51.50 Per Share

pres¬

economy can move

The offering is made only by the Prospectus.

North American Car

time

the

to main¬

If thie

peacetime output.

is done, and if at the same

important in main¬
taining stability of credit conditons, it should be noted that the
so

pledged

materials and to speed the

scarce

flow of

Because the market for Federal

pressures

volume

de¬

favorable consideration.

serve

com¬

mercial banks do not add to in¬

the

power

sirable.

major cut in the inflation¬

that

com¬

scarce,

current

works

too

but the amount of expenditure for
American products which will re¬

should be achieved.
Public

important

flationary

over

clearly grant adequate

as inflationary
pressures are
involved, is not the dollar sums,

accumulated during the war.

ever, must go forward.

three proposals

far

public works is not large. But
such
reduction
as
is
possible

ties, without impairment
trol of bank credit expansion.

to promote world peace and
stability. The relevant point, so

revenues, in order to bal¬
ance Federal expenditures, retire

works

rigidly enforced.

Fed¬
System to insure wil¬
contingencies" the stabiJR/;

der all

gram

carried

date,

mercial
needed.

for its consideration are in¬

tended in part to enable the

These measures to restrain In*,
flationary demand should be cqti*
pled with measures discussed else¬
bank credit, to be used if where in this end in previous Re*
.Measures
which
wilJ ports of this Office,, to. allocate

consideration

for additional controls

credit be continued and

consumer

.ernors

paying." The ad##

efficiency of

this time1 must be, within the
limits of equity, to obtain maxi¬

later

for

which the Board of Gqyr
hassuggested ta the Cqi%

agricultural output.

now, will have the advan¬
tageous result of causing the ac¬
cumulations of plans which can be
a

Reserve System has re¬
cently transmitted to the Congress

power.
For this
it is important for the pro¬
tection of consumers themselves
that controls over the extension of

long-range
legislative
commit¬
Proposed aids to agricul¬
are part of an integrated
pro¬

sures

proir/ptly at

Federal

purchasing

ments.

Deferment of projects, in addi¬
tion to lessening inflationary pres¬

out

total

not * favor

of the market for Federal securi¬

The Board of Governors of the

reason,

powers
gress

preferential

ter-inflationary action.

accumu¬

ment is now

eral Reserve

this

does

with

States will be spent.

may be deferred.

out of

Board

termination

discount rate in April was a coun¬

lated savings, but also by the exr
tension of credit, which augments

"The

higher level of interest rates ap
U; S. securities than the govern*

veterans'

measures

in accord with the American pro¬

Administrator has created an In¬
teragency Construction Coordinat¬
ing Committee, whose purpose .is
examine

the

labor.

At the request of my predeces¬

Since too free ex¬

the, Boafd *of Governors of the
FederalReserve : System
?

pansion of credit by the banking
system could be inflationary, the

housing
construction.
expenditures for social

funds

ment

for

specifi¬
or

sor, Mr. John W. Snyder, and that
of the National Housing Admin¬
istrator, the Civilian Production

needed

programs,

Finally, the outlays under the
heading of international finance
are loans, not expenditures in the
usual sense. They should be made

proj¬

urgently

needed should be deferred, wheth¬

extend credit.

pressure is

current income

terest rate of
Of 1%.
present circumstances this low in¬

encourage bor¬
rowing for the purpose of ena¬
bling the member bank in turn to

exerted,
only by expenditures out of

not

an in¬
Under

terest rate would

Credit Control

Inflationary

the secur¬

expendi¬

tures

otherwise

pressures

in the market for
goods. The sav¬
ings bond, sales campaign must be
continued with full vigor.

I think, will

one,

sion of local public utilities which
require critical materals. In other
areas,

inflationary

eral Reserve banks on

ity of Fedjerai obligations at

Other Programs

localities, pubic works proj¬
increase in¬

ects

progress

anticipated Army-Navy expendi¬

ing

not add

peace.

could otherwise be used in
pro¬
duction to meet private demand.
The Civilian Production Admin¬
istration is screening certain
pub¬
lic as well as all private projects
involving the erection of struc¬
tures, in order to prevent the use
of critical materials in structural

which

American interests

banks

should be-replaced by sales
to individuals.' Every;
penny of in¬
come
saved and put into bond
purchases is a penny, which, will

Besides

" (Continued from first page)
Social-Democratic,- liberal and
conservative governments fdlldw-

ing upon esicli othei1 ifl rapid suc¬

cession.

Ncf party

bad a parlia¬

mentary majority of its Own to
rely upon. All the time the Social-

situation on the
ernment resigned in July 1945,
substitutes for such products as we
labor market. The most outstand¬
and was succeeded by a Socialnormally import, but from which
ing
characteristic
of
present
la¬
Democratic
cabinet headed by
\^e have been cut off during the
conditions
at home is an
Prime Minister Per Albin Hans- bor
War as a result of the blockade,
abundance of work and a great
sbn.
demand and even a threatening
j Above all the production of
look at the present

;

The new government, in which
Myrdal, the re¬

shortage of labor.

Professor Guniiar

war

in 1939 there was

government
consisting of representatives from
all parties, except the communists
Who were then still a very small
party.
By the 1940 election to

fotmed

the

coalition

chamber

second

Democrats

won

jority

that

about the

jority

at last a clear ma¬

and |at

chamber
time

same

was

chamber

Social-

the

labor ma¬

established in the first

which

renewed

■

still in the midst of the

which in 1940 had expanded

oVer

the

Northern

countries

through the German occupation of
Denmark and Norway. It was re¬
garded as a necessity to keep the
controversial questions of internal
Swedish policy out of the discus¬
sion

than

ever

long

needed more
to join forces and stand
as

together
facing
the
menacing
threat of the insane German op¬

pressor.
nobody thought of any
in the government until

change
the

although by the

war was over,

end of the
us were

coalition period many

really

caused.
.

4When

yfear it

the

was

war.

was

tion of weeks when
turn

normal

consequently

the

last

over

therefore but

re¬

conditions, and
coalition gov¬

dependent on a large
trade with the outside

that

any

Sweden.

myself

confine

the

of the

just

program,

the principal

put forward a great number

of issues which in due

time, when

they will have been incorporated
the practical

measures

of the

Government, will result in a re¬
markable change as td the social
and

Its

economic
our

conditions

under

people now live.

second

chief

and

point is fair

higher
living
standard, and the third is greater
productive
efficiency and
in¬
distribution

creased

It
gram

workers in the building,

industrial democracy.

that the pro¬
employment in

be said

may

for

Sweden

full

for

the

time

being

somewhat out of place when we

any o. tuese

Great

Britain.

When

unem¬

ican

population, that would have

same

deal

Sweden

with

International Minerals & Chemical

Corporation
Stock, $5 Par Value

Subscription Warrants for 131,769 of these shares were issued to the holders of
Coiimo.i otock and of Stcck Purchase Warrants cf the Cc.ir.pany, and upon the
Subscription Warrants 115,073 shares were

issued. The remaining

shares not offered to security holders)
purchased by the Underwriters, including the undersigned.

6,7ul unsubscribed shares (including 65

Copies of the Prospectus describing these shares and the terms upon which they
were Dne.ed are obtainable in any State in which this announcement is circulated
from

only such of the several Underwriters as are registered

unem¬

White,

experienced here during the war
as
well as they have in Great
Britain we have during the last

reduce

the

had the opportunity to try

years

where

functions

viously

many

different
pre¬

they have

We too

entered.

never

noticed

have

labor

woman

that women are in

great many capacities very able
workers, doing first class work
and we now know for sure that

there

are

they will probably

again, now

leave

industrial
not
that their ability

sections of our

that

life

revealed itself.
The demand for woman labor in

has

Sweden is at the moment

the

greater

and many firms have
abandoned
their old
principles
than

ever,

given up their
against part bme jobs

and

ried women.
small

resistance
for mar¬

There are, however,
for a more con¬

chances

labor
of the de¬
velopment of the Swedish popu¬

siderable increase of woman
because

of the trends

lation.

General

diffi¬

have taken certain pre¬

dealers in such State.

& Co.

ways

less special war time jobs.
One chief reason for

Scarcity of Labor

should venture

to sum up

the pros¬

demanded

labor from

yearly supply

the rural districts.

With regard to the pace of the
have had during the
transfer of the agricultural pop¬
on the Swedish
ulation to the urban
industries
labor
market
is of course the
there is a very small reserve of
enormous demand from abroad for
labor left now in agriculture and
Swedish
export
products.
As
we cannot of course allow a too
everyone can see, the productive
machinery of Swedish industry rapid depopulation of agriculture.
In addition to this the increase
has been left more or less intact
during the war except of course of the number of peonle in the
for the usual wearing out of ma¬ working ages is slowing down.
chines and such like. If we com¬ The generations born during the
twenties, which are now entering
pare our situation to that of cen¬
tral
Europe
and the countries into productive life, were very
formerly
occupied, ours is of email compared to those of the
course favorable.
The number of first two decades of this century. '
people who have been transferred They are by the way also very
from the military forces to indus¬ small as compared to the gener¬
ations born in the latter part of
try since the end of the war is
the thirties and during the war.
about 140,000, and this has made
These two factors—the slowing
possible an extension within the
industry corresponding to the in¬ down of the increase of the labor
creased demands for its products. in (he working ages and the im¬
A similar effect,
though not of possibility of drawing as great a
the same importance,
has been number of people as before from
caused in Sweden by the use in agriculture to urfyan industries-—
Swedish industry of foreign labor will result in the people in the
consisting chiefly of refugees.
productive ages within the urban
It is extremely difficult to make industries growing only half as
any
prognosis for the develop¬ rapidly as during the previous

perity

tion

over

order

culties

especially is the ques¬
of woman labor. As you have

to mention

difficulties on the labor
market. We had believed that the
moving

long as
of indus¬

try in general prevail.
Another thing that I should

some

two

ment

July 17. 1946.

the aforesaid conditions

period following upon
the end of the war should cause

measures

against

of an offer to buy

131,834 Shares

have been

that

ob¬

„

in a few words the present situ¬
cautions to speed up the circula¬
ployment in the past and about the
tion of labor. So we have among ation I might say that there is a
employment policy for the future,
other things made the labor ex¬ lack of labor in practically all
I think I had better give a short
branches.
Even if industry—for
account of the present
state of change more effective and we lack of raw materials and fuelhave to a considerable extent ex¬
things and how they have come
pended our old system of training should not be able to absorb the
about.
same amount of labor as now we
courses for various professions.
As in all countries we have had
k We knew beforehand that as far have a great reserve of work in
no
considerable
unemployment
our
forests, where there is still
as
we
could get fuel and raw
during the war. Part of the work¬
a
demand for labor by far ex¬
materials for our industry there
ers
have been absorbed directly
would be plenty of situations va¬ ceeding the present supply.
in military service. At times the
I have
already said that the
cant.
An indication in that di¬
number of men engaged in the
rection was given us by the an¬ statistical summing up of the re¬
forces has swung around half a
nual prognosis of industrial in¬ sults of the last annual inquiry
million, but normally since the
about the investment within the
vestment, but we have not been
year 1939 we have had an aver¬
so
optimistic as to think that private industry show that our
age of between 100,000 and 200,there would be no real difficulties industry will if possible expand
000 men in the forces.
to a considerable extent in the
in the distribution of new jobs to
The growing up
the workers who were brought nearest future.
into circulation again from more of the Swedish industry has al¬

NEW ISSUE

nereis:: of such

feared

all

building

larger scale

favorable development as

transition

period.

Before
taken

of record only, and is neither an offer to sell nor a solicitation
sha.es. Tne offering is made only by the Prospectus.

Common

have

materials needed. The
same can also be applied to the
building of industrial plants. As
for secondary sections
such as
transport and commerce I think
we
are entitled to count with a

grant of 50 cents a day.

last

period

the

tain

have been

This advertisement appears as a matter

contract¬

House

large.

continue

than before as long as we can

of labor from the
meant
roundabout 3%
millions
military forces, the war industry
here while you had in fact 10 or
etc., would result in some tem¬
mention 12 million unemployed during the porary unemployment.

Ernst Wigforss,

Mr.

Finance,

which

employing

under the obligation for a

ployment reached its peak in 1933
it amounted to some 165,000 un¬

pro¬

is our Minister

of which

author

for

spite of this we can say that Of three to four months to work
comparatively lucky in the forests or in the peat indus¬
unemployment
never
try.
In so doing they received,
made itself sho\yn in so terrific in addition to the normal wages
figures as in the United States and for the work performed, a State

although its role
in present Swedish politics might
justify such an account. I must
that

authority

public

lit

Heads the

program

has

to be effected, al¬

considerable

and in fact its most im¬
portant feature, is full employ¬ employed persons. With regard to
ment.
This is not the place to the proportions of Swedish popu¬
lation in comparison with Amer¬
give a more detailed account of

Because of the present shortage
labor, a certain "rationing" of

labor has had

restricted sense,
and such like,

fairly

will

ing and peet industries. Moreover,
by the application of a special law
change, for instance of;, the eco¬ on national labor service, all men
nomic stability in the U. S., will born in 1923 have, at a certain
very
soon
have its
effect in time three years ago, been placed

vimrld

gram,

the

is-

because

first heading

The

free

and

for our last

time

extent

just

Our economic life is to such

tions.

Program

ques¬

should

general in¬ ;

is, for its prosperity and
for the increase of its standard of

try

that is in factories

the begin¬ porting wood and lumber for the

Sweden

election.

tired of the

very

deadlock in the home policy which
the existence
of
the
coalition

ternational situation.

program

1944

Thus

one

in our country of the

its program the postof the Labor move¬
ment Which had been hidde up in

cepted

Full Employment

were

war

employment,

When the present Swedish gov¬
ernmeht entered into office it ac¬

In spite of

the swinging over of
the political pendulum there was,
hbwever, no immediate change in
the composition of the cabinet.

shall

ning of the twenties and one in rehabilitation work in those parts
the
beginning
of the thirties, of the world where the need of
both of them obvious reflections such products is imminent.

organization
of the com¬
munity, if there is no risk of its
being given the Opportunity to
carry out the program.

bodies.

to believe that we
to keep the high
standard of employment at least
for the. next two or three years.
The stock of orders in the indus¬
reason
be able

every

ployment, we have an overfull siderable; part of the labor. We
nave in fact been forced to com¬
employment if I may say soi
Let us look back on how labor pensate the lack of import of fuel
conditions have developed in our by an extended cutting down of
country since the first World War. our forests, which by the way is
We have had mainly two eco¬ still going on and at ihe same time
nomic crises combined with un¬ riow reduces our chances of ex¬

the

suc¬

cessively by county electioneering

has

con¬

1946

tendency but if we can get enough
fuel and raw materials we have

though so far to a limited extent
programatic principles fOr living, more than most countries only. It is thus nowadays necesdependent
on
international
condi¬
ary to obtain the permission of a
or less drastic
changes in

down

war

That is to say Wood for heating purposes
absorbed
a
only full em¬ continuously

that We have now not

political scientist, is Min¬
Democratic .(Labor)
Party was
ister of Commerce and Trade, is
growing, aftd became by the elec¬
the first labor Government we
tions of 1932 arid 1936 the domi¬
have ever had possessing a politi¬
nating party, although not yet with
cal majority in both Houses Of the
a
majority. In the beginning of
the
30s
the
Social-DemOcrats Riksdag. Therefore it is of spe¬
cial interest to study what the
linked their forces together with
Government has to say about the
those of the farmers' party.
By
future policy.
granting the farmers better prices
Of course we may say that this
for their products the Labor Party
has brought the Social-Democrats
secured their support for a new
in Sweden into a mdre delicate
employment pohcy, to a large ex¬
tent based on public measures. And position than ever before since
they became a
real factor in
we can now surely say that the new
Swedish policy.
For a radical
policy turned out a complete suc¬
Ratty it is as a rule easier to lay
cess,, A short time after the out¬
nowned

break of the

great part of our peo¬

ple have been engaged in war
production and in such production
as has
been intended to get us

Full
v

Thursday, July 18,

FINANCIAL' CHRONICLE

THE COMMERCIAL &

ESS

can

years

our
now

labor market.
say

What

with some cer¬

tainty is that the whole .situation
for the near future will depend

decades.
What I have said

will show that

limit to
the normal growth of Swedish in- •
■primarily oh the import of fuel dustry if we can achieve full em¬
and of some industrial raw prod-,
ployment..
ucts. We are for the moment very
..One thing that has been dis¬
much in the dark as to thei pros?
;
ifcir -fmrwrrts. We; must; bf cussed lit this tonneCti6n is thfe
import of foreign labor to Sweden.'
comrse calchiatd with' a negative
•

certain factors will put a

Volume 164

Number 4508

THE COMMERCIAL & FINANCIAL CHRONICLE

367;
—H

matter of fact, a limited im¬
migration of labor would mean a
considerable relief in a
a

criti¬

very
industrial and

cal period of
eco¬
nomical development, in Sweden.

with

break

earlier

the

employ¬
country and
launched with great success the

ment

policy in

our

idea of public measures
the wheels going.

to keep

should add that although this
What the government now plans
.topic has been discussed and has to do is to continue the
party's
.had a favorable reception even old
policy and in several respects
i
among the leading people of the
to add new measures on the same
.Swedish labor movement there
.of course not yet any

are

order

Planning for

What I have been
discussing so
j far

are the present conditions on
.the labor market in Sweden and

; our prospects for maintaining full
.employment, if the more general
.present

international

conditions

for the economic life
prevail and
if an economic
depression can be
avoided. In our economic

postwar

.planning, which in
crete

forms

during the

mission headed

,dal,

con¬

1943

and

special comGunnar Myr-

have of

of 1944 and 1945

years

.was taken over
.

its

started

calculated

course

the

possibility of the present
comparatively good conditions be¬
ing followed by a depression. The
Myrdal
commission
accordingly
worked out several different plans
to meet with such an
So far

for

can

eventuality.
that, our fears

say

"transition crisis," if I may

those

use

words, combined with
; unemployment,
has
proved
too
pessimistic.
Our difficulty is to
the

meet

demand

enormous

various products with
supply. We expected
years ago by now to
.

with

for

sufficient

couple of

be wrestling

deflation problem. Now the

continued

prices

upward
still very

pressure

threatening.
we must, of
course, keep our
price-con rol in full force.

And

The chief

economic-political in¬
terest in our country is now di¬
rected

questions of how
rapidly the standard of living can
be calculated

io increase during a
period of five or ten years and how
Targe public expenses for social
and other purposes we can afford

to make.

One might say that the
lively discussion a couple of years
ago about the employment policy

"has

been replaced by an intense
public debate on the questions of

'the financing of our plans for old
age pensions, sickness insurance,
housing policy, etc.

In the background of it all rises

The

problem of full employment.
•Ail social progress and every in¬
of

crease

will

\he

standard

depend

living

the
steady increase of the national in¬
course

And

come.

order

return

The prewar rate of the growth of
we must avoid

•the national income

the

serious

most

leakage in pro¬
ductive capacity, that is unem¬
ployment in any form.
Functions

the

State

every

country can of

certain

duce
own

its

limits

borders.

with
to

re¬

within

its

It is not due to
of

of private industry
to keep

lot

the

real¬

istic estimation of its difficulties in
,

doing, that the plans of the

ernment are to

tent built

gov¬

considerable

ex¬

the activities of the

state and the public authorities
,

whole.

here

don't intend

the -

upon

aspect of the
be taken for

ployment.
.

their

idea

enter

measures

maintaining full

On the whole I

em¬

can say

that the Swedish government have

theoretical

public

program

general

studying

the

accepted
not

only

modern

stock products which they will al¬

measures

ume

the

ment

periods.
of

1932

earlier

from

experi¬

unemploy-

The Labor Govern¬
made

have

national trade during

our

this

for

reason

imports

our

should in
like the

time of

state

own

institu¬

has

also

been contemplated to increase the
purchasing
power
by
reducing

House Building
Of

likewise

have

been

play

an enormous

logical intentions ^eith^r of nation- ;
alizing nor of socializing industry* ■
The decisive policy is that Swed-:
fested by short time work for in¬
ish industry should be effective;,
stance.
Now we have
entered should be able To
employ the.
upon certain investigations as to
available labor, should be able to*;
-has

caused

the

certain

nature

difficulties

the

unemployment,
might
at

this

think

that

some

ployment has

that

derived

unem¬

from

bad

habits, bad organization and
efficiency.

very

low

community where

can

problem different from

wage

let

their

demand

for

in¬

will

housing necessary to
standard. The plan is now to con¬ scientifically

the

productivity of

country.

our

tinue

The

chief

second

the

house

point is our
policy. We no¬ and to reduce the costs by all sorts
ticed during the crisis of 1933-34 of rationalizations
an$l by public
the very favorable effects qf the grants in the form of cheap loans!
increased public outlays piade to There will also be continued an
ensure employment.
One of the increased taking over by the city
future investment

problems
nate

now

will be to coordi¬

authorities

investments

for

private

with

public investment policy. We have
devised a form of cooperation be¬
tween public authorities and rep¬
resentatives of private industry in
order

the

get

ordination.

necessary

the

government

commission
appointed a

has

body called the Investment Coun¬
cil, consisting of representatives
of the public authorities and of
private industry.
There will be
discussed

the

all

could be taken

that

measures

the part of the

orivate industry in order to pre¬
a
reduction of the invest¬

vent

ments at that very

the

responsibility

house-building

ownership
houses.
say

and

new

the

apartment

Upon the whole I might

that the housing policy in

country is

proposal

the postwar planning
the

co¬

now

and will be

new

full

prepare

lic

measures.

of this danger and

themselves for

policy in

wage

volume

and is under

solicitation of offers to

influence

economic

life, to

ing

feature

unions

and

Swedish

engaged

our

the

production.
interest¬

preparations

the

labor

Federation

unions

employing

are

now

and statistical experts to
carry on
own

expert bargainers.

in the

economic

and

any

should

should have
On

give

security,

of living for

standard

there

will be

acting

on a

the necessity
voluntary basis.

The

Localization of

In connection with

the

have

Investment

had

cussion

pie without creating

ern

social

political

unity

the

work

from

few words about the under the

same

country

tions.

the

industry. This is
will

not

come

only

but

with

regard

labor.

•

'■

the

time

crisis

complete

(Par Value $30 Per Share)

problem that

during

the

between the

*Less shares subscribed for

Corporation

to its

through the exercise of subscription warrants issued by the
stockholders, the terms of which are summarised in the Prospectus.

acute

shortage
being

there

Price

labor

ket

the

commission,

and

of the

Copies of the Prospectus
pating in this issue

being dealt s with

emerge

as may

be obtained in any State only from such dealers partici'
legally offer this Stoc\ under the securities laws of such State.

may

any

extended activity

Carl M.

field, but the whole prob¬

plans in the

date of delivery.

repre¬

industry, about

the

government and there will, I am
sure,

mar¬

ing. There has not yet been
need for

$30 Per Share

plus accrued dividends from July 11, 1946

government rep¬

resented by a special

sentatives

Corporation

4% Cumulative Convertible Preferred Stock

continuous negotiations going

are
on

For

localization

always

someTnore definite
near

future.

•

July 12, 1946

Loeb, Rhoades & Co

peo->

continued

being

the creation

Council

will

Industry

the

favorable condi¬

to be construed as, an offering of this Stoc\ for sale,
of such Stoc\. The offering is made only by the Prospectus.

Rome Cable

Sweden

the fairly gen¬

nothing should prevent

and

our

serious

The mod-;

economic

and

has been built
eral

Private

any

political controversies.

63,276 Shares*

interesting dis¬

very

about

expect

possible to carry-

agreement, on

■

] ^

power.

has been

and;

the whole

We have every reason to
that

have

of the

people.

NEW ISSUE

but

advice,

executive

both sides

continuous improvement

circumstances

buy

past—and to create so-,

pie,

Employment and
Enterprise

Finally

poverty—such

out that program in accordance
of with the
wishes of the whole peo-}

economic

the work at the side of their

Full

and ma*;

dissillusion,

ployment,
terial

policy that the labor

new

avert catas-t

trophes like the periods of unem¬

time when an
badly needed.

state-^

the whole sphere;

period of had

with regard to

industrial

It might be noted

for

measure wages

political discussion in

is not,

tools for exercising suehj

necessary

employment, where it will be cial

less totally dominated by pub¬

are aware

already

our

This

tions

Swedish

building on a
larger scale, as far as the supply
of certain material will permit,

Investment Policy

Sometimes

authorities.

in-?

the public [

the

connection I would only mention
that the Swedish labor organiza¬

the

accomplished vby

creased influence from

wages if
economic basis as to prices of raw %
always be a more or less
marked shortage of labor. In such materials, taxes, etc., as the pri- >
a situation it is
imperative for the vate industries. What the governworkers and their organizations ment wants and needs are the

critical, has recently been
closely investigated by a special
committee, which has proposed
large public measures in order to
secure a filling up of the present
lack of houses and
apartments
and to make way for a rapid in¬
of

state]
purpose]

have

upwards

press

building will
not to
part in employ¬

very

crease

taking-over by the

previously had. owned industry competes with thef
There will naturally be a constant
private industries, but on the same]
one

employment substituting for the
fall of exports.
Of course it will
be possible also in the future to
take such compensatory measures
if and when trade is slackening
down.
Such
a
tendency
will
surely not be very favorable; it
increase of

That; would not]

entire industry; the

might

full employment there will

ensure

take the initiative

form.

some

creased wages go so far as to
jeop¬
ardize
the price
level.' In this

reduced

would f

government

the

respects,

not -hesitate to

mean

Wage Demands Must Be
Tempered

policy. The Swedish housing
question, which has for years been

give reasonable wages, and keep;
reasonable prices. If the govern¬

have

already ment should find
That; certain
early stage been able to branches of industry-fail in these

very

notice

causes

and

that

say

mani¬

ment

cause

J
;

also had in certain branches
struc¬
tural
unemployment which

small, and that an expansion
has taken place of production and
very

iwhole

the

house

course

threatening

without

there will

taxes for the lower incomes.

The

an¬

We have

especially sphere of free enterprise, and even
in Sweden with its
strong climatic the democratic* principlesT>f freevariations a very important sea¬ dom in various senses;
sonal
unemployment.
We have
The government have no ideo¬

like.

unemployment also of

other nature.

the

obviously that

unemployment

course

tions, as schools, pensioned people's
such

employment< and private

more or

homes

and

of full

JfJt'f enterprise* From the side ef pri¬

now dealt to some extent
vate industry and the liberal and
caused by a conservative parties, it has been \
less general economic de¬ Said .with 'great vehemence that 4
pression and how we plan to meet the government policy for full em* !
such a situation. Now there
is of ployment - cannot be carried out

with

authorities, buy in

need for their

ways

Unemployment

I have

unemployment,

has not prevented a very

war

favorable economic situation.

lem

during

reach.

can

that the fairly small vol¬

noticed

in this

ences

Myrdal commission is, during an
unemployment
crisis,
to
give
special rebates to the groups of
people who specially need it when

likely to lead to a crisis at home
.f compensatory measures are not
taken.
The question is how far
the effect of such compensatory

that" the questions of localization aris¬

scientific

our

field of the social welfare policy,
the
government is now

cities and similar communal units

discussion of the problem, but also
on

increased

the most probable reason for a
depression in our country. A long
lasting relatively small export is

looking back

way

course

buying certain goods like fur¬
niture, kitchen outfit, etc. The state
will, for instance, give large fami¬
lies chances to continue to buy
gether and lead up to a good furniture, childrens' clothes and
result.
things like that at a time when
Less
favorable
foreign
trade they would otherwise, because of a
conditions is a factor we must reduced income, perhaps confine
reckon with in Sweden. Such a themselves to buying necessaries;
development is as a matter of fact It has also been proposed that the

intentions

doesn't

government

rely upon any one single measure
for maintaining employment. On
the contrary the plans comprise
many
big and small measures
which are intended to work to¬

to do its best

things going but to

purchasing
by
the different reform plans in the
a

is of

power

Seasonal and Structural

So far the intentions are that this

comes

course

consequences

underes.imation

■

the- Swedish

Council

international crisis

must realize that

increase would

International Crises
If

Employment

the

sumers.

putting before the parliament. One
plan that was put forward by the

Program for Maintaining
First of all

Depression

ing slack in employment the in¬
creasing in various ways of the
purchasing power of the < con¬

which

main line.

steps taken
get a solution of the
problem this way.
in

Of course the government also
includes in its plans for combat¬

&•<>-

"<!' ffl.

Thursday, July 18, 1946

iTHE COMMERCIAL & FINANCIAL CHRONICLE

bevimporte^^
any
ihe latter at ccfuntyyli^ill^fdepeh^-ail theVihbre
United States, although; the effect a; high lev&'while- the policy el upohv&^bs^abity .^lehd of that •
is; pursued country. In- this respect -it should
Pir: Great .Britain alpne may be .de-industrialization
Britain ap4 .the 33rjii|jsli Cotirtrbon-f
wealth more keenly than by the

ported as reparations, it; piay be

less than that on the United States;

simultaneously. But Japan's share

(Continued from;page 336)

j
which are .further divided into piece :goods and yarns, while calf
other
consumers',
goods
are
siib4
two- sub-groups. The first sub4
J£>

-consists of "absolute necesf
sities," namely, cereals and cotton

group

•

.-KI

•Jm

'•

•

—Value in U. S. Dollars^

Gfc.
IT.

J^pan

of Total Supplied-

—

Sub

(a)(III)(b) Tot.

-(a)(III)(b)6,264,890
448,250 15,049,910

(I)
19.1

(II)
9.6

6.4

13.1

6.5

18.1

25.2

1.3

29.2

12.2

7,696,370

21.2

13.8

4,105,970 20,049,260

18.8

10.2

...

2,137,850

13,184,790 14,925,460
11,683,460 11,033,330

Germany
Brit.

(ID

11,847,750 10,437,590
11,255,180 27,328,880

Britain
S.

(I)

•

FROM THE

the case of some commodities are excluded)

(Imports oij small value in
«,

sub-5-

ANALYSIS OP CHINESE IMPORTS
MAJOR SOURCES OF SUPPLY
1935-37 Annual Average '

SUMMARY

'"'■I'll

second

the

under:

group;-

TA3LE I

•

sumed

12.3

14.9

6.0

33.0

18.7

Common-

fewealth

coun¬

tries, includ.
Hong

ing

607,770 10,971,150
9,064,150 10,515,900
1.0 10.1 27.1 24.5 15.3
(III) represent the commodity groups.
(Ill) is further divided
necessities,'' and (b), "others."
The last percentage column is

•"'Kong
!)i

•'(I),

into

and
"absolute
(II)

(a),

the total of Group III.
"

-T

TABLE

■

1935-37 Annual Average

,■

COMMODITY GROUPS

IN CHINA'S TOTAL IMPORTS

>t;

Value in

Groups—

(a)
(b)

visaged

36.2

ment

—

Total

can

easily

from

seen

Table; II, during the period under

consideration,

about

43%

95,608,520

31.9

128,971,520

43.0

299,459,920

100.0

China is
likely to affect the United States
although

than Great Britain,

Commonwealth

British

the

China's total annual imports con¬
sisted
of
consumers
goods.
Of

whole is likely to be

these

than the United States. Similarly,

74%

not

were

necessities."

"absolute

importance
was Group II which made up 36%
of the total. Capital equipment in
the narrow sense, on the other

hand,

occupied

than

goods"

are

United

the

fect

likely to af¬
far more

States

both Great Britain

than

and the

British Commonwealth. Finally, as

the

and

Britain

Great

20,8%.

affected more

changes in the import of "inter¬
mediate

by he

process

Chinese

involves

series

United

undertakings,
in

the

en¬

Govern¬
of large

11.1

sumers' goods import to
more

industrialization

20.8

Sub-total

the

Total

62,176,550
108,311,850
33,363,000

(II )XL1

(III)

will be needed. Now since

seems,

U. S. Dollars

e'(1)1(

in spite of the
fact that in pre-war days British
and
American
exporterscon-r
tributed
approximately
equal
shares of China's import of capital

hand, if the import of capital
equipment
in
large
units is
stepped up, long-term credit or
direct
investments
or
both, it

IMPORTANCE OF THE DIFFERENT

RELATIVE

THE

in¬

probable

capital

equipment im¬
port will belong to the second
category. Should this be the case,
crease

the

capacity to lend and to invest
the

United

Britain

would

States

and

become the

Great

deter¬

mining factor in deciding where
China's total
import of capital
equipment, and not just its in¬
crement in comparison with the
figure, will

pre-war

for

raw

goods belonging
"intermediate

probably

from.

come

materials

other

and

to the group

goods,"

assume

that

one

can

their

im¬

China with port will increase or decrease ac¬
approximately the same amount cording as to whether total im¬
of
But
capital equipment, one might ports increase or decrease.
rapidly, the proportions between
the three major groups of imports be tempted to argue that within in so far as this group of com¬
modities
is
this
composed
of
industrial
group changes in the amount
might not fluctuate violently in
the short-run. Further, had there imported might affect both coun¬ raw materials, it seems reasonable
to assume that the largest sup¬
been no change in other condi¬ tries in the same degree.
plier of capital equipment will
tions, the relative position of the
also tend to supply a larger pro¬
Simultaneous Changes in
major supplier countries in re¬
Import Groups
portion of these items, a possibil¬
gard to these commodity groups
might also remain fairly stable
However, this alone does not ity not to be over-looked espe¬
in a short period of time. For in¬ answer our question. For we have cially if foreign loans are "tied."
If there had been

if China

were

war,

and

States used to supply

not to industrialize

ternational purchases are to some

extent

various

will

conditioned

and

purchasing

tivated pver

the

good

habits

number

cul¬

of years,

and
thei relative positions pre¬
vailing in 1935-1937 probably re?4
fleeted the relative degree of com¬
petitive enterprise of the different
suppliers,
which
may
not
be
easily altered.

the

assess

effect

net

the

countries
of
simultaneous changes in the dif¬
ferent groups of imports. Simul¬
taneous changes in the propor¬
supplier

tions between the several groups
of imports tend to occur

absolute
total

increase

with

decrease

imports, and they may take
of changes in opposite

form

the

directions in the absolute amounts

Tlie

Urgency of Industrialization

•

But although industrialization

is by no means a departure from
China's "traditional" policy in the
last decades, the war has made it
a matter of utmost
urgency in her

program

postwar

recon¬

struction. Moreover, Germany and
Jajpan which together used to sup¬
ply over 30% of China's total an¬
nual

imports
from

peared

have
the

now

disap¬

and,

scene,

As the United

States

was

by far

the largest supplier in this

import
group before the war and will in
all probability
become the one
major supplier of capital equip¬
ment on the Chinese market, at
rate in the immediate future,

any

probable that her share in
this field will now become larger
still.

British

while

Thus

exporters

will probably face a decline in
import groups.
the export of consumers' goods to
development in
the composition of Chinese im¬ China, a compensatory increase in
their export of capital equipment
ports during the period under con¬

the

The

different

most

likely

sideration is

rise of the absolute
share

relative

and

capital
equipment accompanied by a fall
of the absolute and relative share

of consumers'

goods. For between
1935 and 1937 the average deficit

China's

balance

amounted to

over

of
S.

China's

certainly
become smaller, although; the de-j
crease may .not be uniform with
regard ; tpj the different; JrhppH
groups. If reparations. are disre¬
equipment* the probable increase garded, the disappearance of the!
of the capital equipment imports Japanese
competitor will prob-?
be felt most on the market
may not benefit the two countries ably
of consumers' goods. On the other
equally in the future.
Capital goods may be imported hand, the elimination of the Ger¬
either in small units or in very man competitor will considerably
affect China's import of capital
large units. If the increase of their
import takes place in small units, equipment. To the extent the mar-:
which in the short run may not ket of consumers' goods is vacated
aggregate to a large figure, pay¬ by the Japanese, it is possible that
exporters in the British Empire,
ment for them can perhaps be
effected
by current export to¬ and, in a lesser degree, those in
Great Britain, will be able to step
gether with a contraction of cur¬
into their place. However, this ad¬
rent import of consumers' goods
which perhaps will not have to be vantage would be reduced if the
on
a
large scale. On the other import of consumers' goods as a
On the other hand,

•"

difficult: to maintain

trade

$70 mil¬

and

materials will not neces¬

raw

sarily materialize. If we disregard
investments

British

future

China,
any
export
of
capital
equipment from Great Britain is
likely to consist of capital goods
in

small

units

for

the

Chinese

private entrepreneur. On the other

whole

port
credit
arrangement;
sec6ndly,;that;.theyprobab

to which country will

benefit most from the disappear¬

ance

Germany from the field

equipment

capital

export

China is inextricably linked with
the

capacity

the

question

invest.
The

of Investment

Importance

Thus

the whole the changing

Sas

so,

can

above

have

easily

seen

tables, if there is

tionate increase

the

left

import

sizable

from

the

a propor¬

decrease in all

the resultant
change in the import of con¬
sumers' goods will be quantitatively
more
significant
than
changes in the groups of capital
groups,

lion.

What

one

own

contraction.

hand, this adverse effect

with

China

British

the

trade

possibility

the volume of Chinese imports

will

probably

felt

Great

tries

carried

hopeful

important

The

one.

some

manufactured

of
to

China is bound to decrease. In the

(1) We are abstracting here
from the factor of prohibitively

case

tions

Japan,

may

however,

some

repara

extent

seems

increasing impor¬

competition

relegate

market

ordi¬

the

to diminishing signifi¬
Already the existing regu¬

sense

nary

cance.

lations regarding

foreign exchange

foreign trade control, which
have
become
effective
since
and

March 4,

1946, and Feb. 26, 1946,
respectively, are pointing to this

tendency towards increasing con¬
trol. Although the present import
and export regulations are said in
certain quarters to indicate a re¬
control

inasmuch
neither

prohibited
and

nor

potentially restric¬
these

nature

tive

which are
require a

termed "free," the in¬

are

herently

imports

over

all imports

regulations

unmistakable,

flow into China.

So far

mit.

private direct invest¬

But

as our

analysis has prob¬

Company Law.

made it abundantly clear,
conditions warranting the freeing
of China's foreign trade may not
be ' fulfilled
for
a! considerable
time to come. On the contrary, it

objections

may very

abroad

from

ment

discussions

recent

concerned

have centered

around the revision of the Chinese

But whereas the
raised by American
business interests, such as the Na¬
tional
Foreign
Trade
Council,
have been directed against certain

provisions of the revised Company
Law
in
its present form, they
probably reflect a deeper appre¬
hension
about
the fundamental
issues in the Chinese economy, es¬

pecially those affecting foreign
capital. Given the present policy
of

the

Chinese

foreign

wards

Government

investment^

reasonable to

seems

obstacle

there

capital

assume

to¬

it
that

least a considerable
the path of foreign

inflow

by way of direct

Import Control Policies
If

private

direct

investments

give way to loans as an important
form of capital inflow, the degree
in

which

capital equipment will

ably

temporary

well happen that these
regulations will have

to be made

(2) See Y. L. Wu, "Postwar In¬
The Banker,

vestment in China,"

permanent.

In this connection a

passage

Eighth Report of the House

the

Committee on Post-War
Economic Policy and Planning of
Special

American Congress is

the

highly

interesting, Mr. Edward S, Mason
writes that "unless we are willing
lend

merely

increase

em¬

ployment with the certainty that
when the debt is repayed the dif¬

maintaining employ¬
be increased, the

ficulty

also

will

ment

considerations which justify for¬

eign lending run pretty largely in
terms of encouragement of eco¬
nomic

development,

the

advan¬

tages of which are shared through
the resulting expansion of world
trade. There is no assurance in the
case

of Russia that the advantages
be

would

boldface

shared."

(Page 66,

mine.)

is probably a very clear
representative statement of
American policy towards foreign
lending. If China establishes trade
barriers, and seeks foreign loans
This

and

at the same time,

and if the need

for

is enhanced by

foreign loans

the

deficient

investment

inflow

as a

foreign

result of an am¬

biguous general economic policy,
it

correct to conclude that

seems

some

further serious

thinking is

necessary

With respect to Chinese!

economic

policy. This is a matter

oi-concern

offset

high costs under inflationary con- this tendency, at any rate in the
goods and intermediate goods. Andi ditions which are handicapping short run, and- unless existing
jmy increase or decrease in con?
Chinese exports today
capital equipment in Japan is ex^

increasing

underlying

cause

development

coun¬

goods

regard

Furthermore, the new exchange
regulations provide that all ex¬
be the replacement of competi¬ ports and re-exports must be ac¬
tion in terms of price and quality companied by a certificate of pur¬
by the availability of credit and chase of foreign currency, which
capital investment as a determin¬ means that exporters cannot make
ing factor in China's post-war in¬ use of the proceeds of their sales
ternational trade. This dependence in foreign
currency
to finance
on
foreign capital has come to imports, thus tightening the con¬
shape r in
a
decisive
manner trol of foreign trade in comparison
China's
present
foreign
trade with past practice. It is true that
policy which, in its turn, may play these regulations are "temporary"
a
not at all unimportant part in
measures, to be
relaxed or re¬
determining the size of capital in¬ moved when circumstances per¬
such

out, their export

of capital equipment as well as

Chinese

the

control¬

the

may
Both

especially be¬
cause all imports, whether free or
not, are subject to exchange con¬
most trol by the Central Bank of China.

large investments by Britain is
disregarded.
The case of United
States
trade
with
China
is
a

investment.

dustrialization of these two

tend

once-

possibly "tied" loans will

tance of

license

effects

with

result of its

the

control and the

to have more unfavorable than fa¬

dislocation, war
damage and the wartime develop¬

authorities

"non-essential."

laxation

vorable

which

commodities

ling

pattern of Chinese imports con¬
sequent upon the projected in¬
dustrialization of China is likely

hand, as the British Empire sup¬
This being the case, Govern¬
vacuum
behind.
In
what
plied by far the most predominant
way,
therefore, will the pattern of ment of substitutes abroad, the share of China's pre-war import ment loans and private loans with
China's imports change under the volume
of those consumers' goods which Government guarantee will prob¬
of
Chinese
exports
is
impact of these forces, and in likely to become even smaller in may be regarded as "absolute ably be the two major forms of
what way will Great Britain, the the
period under consideration.! necessities," a decrease in the total capital inflow from abroad. But
British Commonwealth and the
as
Government and Government
volume of consumers' goods im¬
Consequently,
an
increase
in
United States be affected respec¬ the absolute share of the
import port may not be as detrimental in guaranteed loans will not suffice
tively?
of capital equipment, unless it is regard to these "absolute neces¬ to alleviate the shortage of capital
The
effect
of
a
quantitative accompanied
by
an
inflow
of sities" as the extent of the total in whatever field may be marked
for
private
enterprise
in
change in the import of any com¬ capital investment, will in all decrease may suggest. But this is out
modity on any particular supplier probability necessitate a contrac¬ likely to benefit British exporters China, and as it is perhaps the
the
British
Commonwealth policy of the capital supplying
country depends, first, upon the tion in the absolute amount of in
relative significance of that com¬ consumers' goods
import. Thus the more than those in Great Britain. countries not to allow such loans
to replace direct investment in all
modity
in
total
imports
The outcome of the disappear¬
and, latter will suffer a relative de¬
secondly, upon the relative share cline not only in consequence of ance of Germany and Japan from circumstances, this would mean a
of the commodity supplied by the the probable increase in the im¬ the Chinese market will
reduction of the total volume of
depend
particular country. Consequently
port of capital goods, but also as upon Allied policy. If the de-in¬ foreign investment in China.

doing

"tied,*' to borrow

-ana

again a
term used by the London ;"Ecoifi
omist." Further, if the volume of
capital inflow from abroad is not
as large as
it might be if there
were
considerable private direct
investment/ stringent measures of
exchange and import control will
have to be adopted all the more
quickly in order to curb the im¬
port of consumers' goods and other

On the other hand, the

the British ex--1

than that of

tion

to contract, as it prob¬

were

ably will.

question

be nofed' that i^thes^^loans4
first^Mve to be of. a

import will

hot only to the

freeing

Chinese,

interested in the
pi international - trader;

but to all people

(Volume 164

THE

Number 4508

COMipf^I* & XWWCIAI* CHRONlCfeB
^

•(Continued frqm .page 340);
point out- that whoever may be
your favorite candidate for the
1948 Republican Presidential nom¬

ination, that nomination will be
infinitely more valuable to him
if

elect

Republican Congress
this year.
To ray mipd, one of
the greatest
disservices which
cbuld be rendered to the Repub¬
lican Party and to the Nation
would
be
for Republicans
this
year to become involved in bick¬
erings
and
maneuyerings
con¬
cerning their 1948 Presidential
we

candidate.

Let's

fight before

we get

win

the

1946

ihto the battle

of 1948.
I said

few moments ago that

the election of

Republican Con¬
gress this year would guarantee
the preservation of our free, lib¬
eral, American system of govern¬
ment. I wish to say also that fail¬
ure
to elect a Republican Con¬
gress this year will expose the
Nation to grave danger that our
historic system will not survive.
That may appear to be an ex¬
a

symptoms of the attempt to

are

establish

Red-Fascism

erties of the people. They planned
it that way.
They cry out for
of

and

that

abuse

Democratic Party Elements
The

Party which is in power
today—if it can be called a Party
•—is one which is made up of three
distinct and mutually
elements.

There

antagonistic
is

held

captive to the Democrat
Party by the chains of an archaic
It is really a shame that

condition.
so

many

Southern
from

good Americans in our
States
are
prevented

their views on
national
issues
through
their
elected representatives
in Con¬
gress. In effect, these representa¬
tives are enslaved by the leftregistering

wing elements which dominate the
South chooses to adhere to the

I know of no
this situation.

one-party system,

effective remedy for
There

the

are

Ma¬
in poli¬

City

Big

chines whose masters are

get out of

tics for what they can

use

then

the

dictator

and

and
a

henchmen, as the State,
under Mussolini. The

Italy

ference

between

terms

ence

only.

and

differ¬

which

has

been

the Red-Fascists.

aptly called
It is this group

people,

lishment

The

then

and

estab¬

cause,

poses,
the Democrat
I do

Stalin.

under

Cloak

Now, what is this Red-Fascism
which parades under the cloak of
"Liberalism" in our country?
It
is just some more of the same old
poison with another label on the
bottle. Their effort in these United

States is to broaden and
the

control

the

increase

Federal

Gov¬

the people—and to
government of laws in

over

displace

favor of government by men.

ultimate

consequence

the

The

would

Italy, or Germany,
or Russia—dictatorship at the top,
and a crushed, enslaved people
at the bottom. So, then, as I speak
of Red-Fascism, I mean the same
brand of political and social, and
industrial, and governmental poi¬
same

have

son we

countries.

operate in other

seen

We want

of it in

none

free

America, but unless we make
fight, these merce¬
nary men, lustful for power, will
a

determined

continue

work

scheme to

and

fasten Red-Fascism upon us.

It is

sad and regrettable fact

that President Truman has deliv¬
the

House

influence

over

establish
is

to the

the

White

who would

men

Red-Fascism

here.

sad and regrettable fact that

Party.
moment suggest

not for a

itself under the label of

that

members

this

radical

have insinuated themselves
into positions of great power on
group

the

policy-making

level

the

in the pres¬
Administration in

Democrat Party and
ent

Democrat

Washington.
to

which

They call the tune
the
Administration

dances, and the tune is
like the Internationale.

with

White

consent, has delivered over

America.

grettable

fact

and

sad

that

the

that the farmer in Italy, or in
Germany, or in Russia, was not a
man, but a public utility. They can
tell you that the workmen of Italy,
Germany and Russia, are not free,
independent citizens, and mem¬
bers of free / independent trade
unions, but chattels of the State.
They can tell you that the house¬
wives and white collar workers,

and little businessmen in
those countries, were at the mercy
of men who did not hesitate to
the big

government power against any
They can tell you that the

citizen.

confusion and' compulsions

the

The

Democrat

Party
that they have

about bringing homd*& ;
the citizens of thisr Nation the
redl

of this

deliberate

leaders

know
no

full

remote

chance to retain power nationally
without the help and assistance
radical fringe.

sented to those who wish to
pre¬

litical

serve

So,

New

which

Administration—
Truman asserts over

Mr.

over

under

Deal

his

—and the

again is still

in power

Presidency—sold itself
country, into the hands

political extortioners and black¬
mailers—and the nation is
paying
the bitter price of that
unholy
deal.
This

cause

power

happens in America—be¬
the men holding the real
in the Administration have
their sense of direction
of dedication.

sense

establish

stay

alien

and to
here are

rule

thwarting your Constitution, un¬
dermining your rights, and tear¬
ing at the very foundations of
American

free

society. They are
teaching class hate instead of tol¬
erance; dissension instead of the
cooperative spirit; organized and

only

our

alternative

system

make

sure

pre¬

of government
that we elect a

Republican Congress

in Novem¬
believe that what I have
said thus far outlines
very clearly
the difference between the Dem¬
I

ocrat and the Republican Parties.
The Democrats have fallen under
the control of those who would

destroy our system of govern¬
ment; Republicans have no such
embarrassing alliances and will
do everything possible to preserve

that

have strikes instead

prosperity is their failure; that
and your family owe $8,000

you
as

your

government

debt piled up by their

inefficiency
and extravagance is their failure,
that we have inflation right here
and now is their failure; that we
have a huge bureaucracy which
eats your earnings in taxes, and
bosses
and

the

life

your

government

failure; "but
real

issue.

whether

the

mercy

men

who

istration,

propaganda
is their

all these

are

not

The real issue

people

now

control

even

the

shall

Unscrupulous

control this Admin¬

whether the Govern-

afraid, appreciate tbakthe obt
of^qr the violatiorn of *
the. provision of the Constitution, J
affects their daily lives in an in¬
finite variety of ways.
It is the Constitution which
pre¬
servance

the

vents

United

States

here

tonight

and

still

another

way

stating the difference between the
two parties. The Made-in-Moscow
philosophies of those who now
control the destinies of the Demo¬
crat Party teaches that the

people

belong to the State.
solini.

So did

So did Mus¬

Hitler.

did the

exercise

listen.

There

are

world

today,

the

nations
covering a

face, in which

There

which the ruling group wishes to
accord

there

them,

other

many

and

nations

there
in

Political Interests of

Women

can think of no
group in our
population which should be more
keenly interested in the promot
ing of ■ Republican, of American,

principles, than the women of the
United States. They have more to
lose if a contrary philosophy pre
vails.

no opposition parties at
all—because they are not permit-

ted.

Sneering at the Constitution

other

and

stooges and dupes, to
Constitution

as an

sneer at the
instrument de-r

signed to protect private proper¬
ty. It certainly is designed to
pf(^t
private property. True, humaii
rights come first but one of the

tect

first instances of human rights is
the right to hold property. There
are

many

viduals

other

which

rights

must

fruits

of individual endeavor is
one which is the basis of
any free
liberal civilization. I can not con¬

Contrast the status of

wom¬
ceive of a society in which such
Germany under Hitler, in rights as freedom of speech and
Italy under Mussolini, with that of religion are protected, but thd
which
prevails
in
the
United right of private ownership of propd.
States today, for a striking illus¬ erty is prohibited. If there is no
tration of the truth of what I h&ve private
ownership
of
property
just said. It is customary for those each individual then becomes d^.
who
oppose
the Republican or pendent for his livelihood, for his

American j philosophy
ment

sneer

at. the

of govern^ shelter, for n his food,-; upon the
American whim of some government- officiah

j Constitution.
us

I fear that those, qf
who believe in and support the

He may get enough to'eat,i

(Continued

on page

LOEW DRUG CO., Inc.

30$ Cumulative Dividend Preferred Stock

and true

Americans, can no longer
provide an administration in con¬

formity with traditional American
freedom.
the

The

Democrat

best

statesmen

54,000 Shares

Party who believe

in American

principles can secure
party only
foreswearing their scruples
and lining up with the enemies
of our American system.
In this land of plenty you
h^ve
seen no suits, no shirts, no meat,
no
butter.
Our
fighters went
away
to war regarding them¬
selves and their countrymen as
free Americans. They returned to
an
America baffled by strikes,
violence, stoppages, and cohfu
sion. They find American homes

today

shaken

with

fear

the

They went away with

they
as

were

future

feeling

performing their duty

'American

citizens;

they,

re¬

turned to find powerful and self¬

ish
and

men

thinking nothing of duty
responsibility to coming gen¬

indi¬

will be

protected, but the right to - Odra
honestly and to retain and use the

54,000 Shares

reactionaries

and

Party,

radical

I know it has been the
custom
among the Red-Fascists and their

Position of Democratic Party

ruptured
by this struggle between the Reds

are

which

are

of this alien system here.

Democrat

are

nations in which opposition
parties
have only those rights

many

Party

The

sur¬

meeting such

re¬

machinery is being
from the Democrat
Party duly elected representatives
of the people who believe in our
free American system, and who
oppose bitterly the establishment

the

lords of Japan.

war

Common Stock

Offered

many

influtnce

used to purge

you

right of free speech in addressing
you, and which protects you in
your right to
assemble here to

this could not be held.

There

;

any
your

please. It is the Constitution of
the United States which prevents
human slavery in this Nation. It
is the Constitution which
guar¬
antees to me my right to stand

of the White House and the Dem

ocrat

state, from interfering with
right to worship God as

entire world.

houses for veterans and a hundred
other essential items is their fail¬
of

compelled to
memorize
during
their school days. They do
noty*T
am

major portion of the earth's

The Repub¬
lican
philosophy, the American
philosophy, is that the government
belongs to the people, and the
bureaucratic tyranny instead of a
people belong only to God. It is
rule of, by, and for the people; this
latter philosophy which will
and you are
suffering the conse¬ be translated into action, into
quences.
legislation, by a Republican Con¬
That we have seen shortages of
gress following the elections of
lumber, of building supplies, of next November.

ure;

significance of that historic docu¬
ment.
Too many of our
citizens,
I fear, think of
the^Constitution.
as • something
which they were

the system under which this Na¬
tion has become the
envy of the

power,

the

Constitution have
.bejKjL somewhat

careless

you

Committee,

belongs

For it to do

menace.
amount

self-destruction.

strongly harmony within their

The men and women who have
been abroad in this war can tell

use

liberalism.

What I do mean to say, however,
is

tional^:

-—*V

It traded the
Administration's integrity and the
people's trust for a mess of po¬

nation

the Democrat Party machinery to
the
radical
reactionaries
who

gov¬

happens because these radical and
mercenary men, in their determi¬

"Liberalism"

would establish Red-Fascism here

majority, or even a major
faction of registered Democrats in
the United States, believe in this
Red-Fascism which seeks to mask

that

lopsided, unfair

would

teers and exploiters.

their

be¬

far all intents and pur¬
it has captured control of

Administra¬

reactionary
so

well

and

vic¬

It is the most important be¬

tant.

wanting

ernmental favors and
influence
for votes and political support in
the black markets of the racke¬

the State—as in Sov¬

House

ideology of

traded

men

The

power.

both

and

upon this Nation the very form
of government against which we

holden to the political

tion

lost

dictator

the Chairman of ; the Democrat Na¬

Moscow which is the most impor¬

secret

his

of
as

the

over

which seeks, through the medium,
of the Democrat Party to fasten

have just waged a great and
torious war. It is this group,

Because the New Deal dick¬

ered and dealt with

Communism

is the exaltation of the State

the

dif¬

Fascism

Communism, actually, is

ered

Then there is the radical group

ica?

and

the

people
establishment of
his

.^*(1

The JDemoerat Party is power¬
rid the nation of this red

ism is the exaltation of the State
over

less to

ber.

i,;,

politics.

only of their own
personal political fortunes. Why
does this happen here in Amer¬

the

freedom.

our

»- - *

The Red Reactionary Menace

but

What is Fascism, and how does
it differ from Communism? Fasc¬

and

ernment

which

South

the

and

power

They
it to

erations,

is to

iet Russia

sus¬

'' l"

pottage. Now the pottage
las disappeared and we have
only
the mess. It has, happened because

study of the situation in
we
find ourselves today.

will

name

ideals.

destroy our society, our govern¬
ment, our security, our prosperity,

not taken the time or trouble for

Nevertheless, the facts
tain my contention.

in the

power

humanitarian

henchmen

which

this

You see princes of po¬
litical
privilege
flaunt
their
powers before the American peo¬
ple while the puppets of a politi¬
cal monopoly use instruments of
public power to shackle the lib¬

treme statement to those who have
careful

country.

■

ment of the United States
to you.

s
«•

■

units

consisting

Preferred Stock and

one

share of Common Stock

Price: $5.50 Per Unit

First Colony Corporation

Childs, Jeffries 8C Thorndike
Incorporated

he may
370)
"ft

THE COMMERCIAL & FINANCIAL CHRONICLE

370

ABA Manual

Democratic Party's
Red-Fascist Trend
(Continued from page 360)
have a roof over his head, but it
will not be his to choose what he
eats, or when and where his home
is located.
Such a society is not
a free society.

vided for liberty, because

the rights of individuals
protected individuals in the
ownership and use of the results

anteed
and

into

existence

litde

Win the Election

before

that,- man had been strug¬
gling .for a system of government
which would guarantee his. rights
as a fr$e■;;
hidiyidual.< I thinb it is
significant that in the centtiry ahd;
a

half since

our

Constitution

was

we
have made more
in science, in the meth¬
ods of producing the things needed
for healthy for comfort, and for

adopted,

progress

protection, than \n all of the cen¬
turies since the beginning of the
Christian era to the adoption of
our

Constitution.

At the time our

it is unnecessary, be¬

I believe

than

For several thou¬
sand years of recorded history and
for tens of thousands of years
150 years ago.

their labors.

The Federal Constitution came

it guar¬

fore this audience at least, to de¬

velop further the advantages of
our system over all those which

preceded it and over many of those
which exist throughout the world
today. The hard, practical ques¬
tion confronting us is what to do

election, to make sure
do not slip back into the

to win this

chat

abyss of tyranny and slavery—for
the two always go together—with
which we are threatened today.
The

organization, hard

answer

Votes

work, unceasing endeavor.
are not counted until they
even

necessary

are

Sometimes

box.

ballot

the

to take precautions

adopted, if men
traveled by land, they walked or
they rode on horseback, or per¬

to make sure that

drawn by horses
in carriages. The same was true
at the beginning of the Christian

this election by sitting around in

Constitution

haps they

era.

and

stitutional
in

traveling

were

they were propelled' by
by sails, both in the year

1-A.D.

were

men

water,
oars

was

time

the

Convention

Philadelphia. If

the Con¬
assembled

wished to
other,
their messages were carried by
the same means of transportation
which
I
have
just mentioned.
Railroads, and steamboats, and
electric
power
were
unknown.

communicate

men

each

with

The

telephone,

were

in the

telegraph,

the

same

category. Sur¬

they.are counted
then.- What I am trying to say
is that we are not going to win
drawing rooms and clubs and con¬
demning the bungling of our pres¬
ent Administration and

denounc¬

ing the philosophies of those who
direct that Administration along

We are going
only by making sure that
we arouse the voters to the point
where
they actually cast their
its wayward course.
to win

for

votes

win.

candidates.

our

do not deserve
Freedom is worth fights

do not do

that,

for and those who are not
willing to fight for it do not de¬
serve to have it.
I am sure that
ing

can

count

the cooperation

performed operations with¬ —the hardworking continuous co¬
of anesthetics, and operation—of every person pres¬
without the slightest knowledge ent here tonight and for that mat¬
of the techniques of preventing ter of the vast majority of all the
infection.
As someone so truly women of America. That means
said, it was then the custom for carrying the message back to your
the surgeon to wash:;his hands respective homes and neighbor¬
after the operation, but not beforet hoods. Interest others in our fight
geons

benefit

out

the

Compare

conditions

which

for the preservation of the Amer¬
ican system of government.
See

I have just described with those
which prevail today, even in coun¬
tries which by our standards are

with

comparatively backward. And

work

re¬

that

they take active part along
you.
There will be hard
but the

involved

stake

for

whidh we are contending is well
made,; have? beem made since? oiar worth all of the sacrifices we may
forefathers brought into being a be called upon to make.
member that all of these advances

instrument

new

instrument

which

was

government,
government

liberal because it pro¬

A
will

Republican victory this year
be a victory for the United

States of America.

Farm

banks in all sections of the United

States which plan to expand

just published a manual entitled,
"Farm Equipment Financing by
Banks."
The manual, which was
mailed earlier in July to all ABA
member
banks,
was
produced

jointly by the Association's Agri¬
Commission,

the Com¬
Credit, and
the Small Business Credit Com¬
mission.
"Serving the farmers'
credit needs is the most impor¬
tant function of a country bank,"
the introduction to the manual
cultural

mittee

Consumer

"The mechanized farm is

states,

counterpart

modern

establishments

business

and-a-half million by the end of
June.
j

Although public

focused

attention

was

the soft-coal and rail¬

road strikes, the great majority of
workers remained on their
jobs.
Fewer man days of idleness due

to industrial disputes were record¬
ed; during the last quarter than

in the first

three months

of this

year.

Our

people are earning more
and they are purchasing a

money

greater volume of goods than
before in peacetime.
We

are

meeting in full

ever

our com¬

mitments

to
ship food to the
starving peoples of the world.

}

than

made

progress

thought possible
providing new houses

many

ward
our

have

to¬

for

people.

Certainly, up to this point
inflation has been

away

run¬

pre¬

vented.

all of the ground we have so la*

boriously won against inflation
will be irretrievably lost without
a
workable price
control ; law*
Every day that
law

without a
the books increases that
passes

danger.

deter¬

everything within its
under the authority grant¬
ed by the Congress, to maintain
power,

perience with farm equipment fi¬
nancing, and welcome the oppor¬
tunity to assist both the dealer
the

and

farmer

To this

est

extent

the

activities

of*

the

try and labor to attain the high
volume
of production necessary
to ward off inflation."

conducted

pending price
control measures, the Administra¬
tion is reviewing its fiscal and
monetary
policies.
Government
expenditures will be reduced. All
deferrable construction
lic

works

and

pub¬

projects using Federal

funds will be studied with

view

to saving strategic materials and
diminishing inflationary pressures.

Military
above

and

which
earlier

veterans
have

program

been

estimates

rising
will

reviewed to determine where

most

the

study

practical methods and ^operating
procedures for farm equipment fi¬
nancing which forms the basis for
this manual."
The manual pro¬
vides

complete

information both

loans for the purchase
equipment and-for the
purchase
of farmer obligations
from dealers who have already
made sales.
The publication de¬
scribes in detail retail financing

direct

farm

and

inventory financing, and in¬
of forms used

cludes illustrations

completing the transactions.
Copies of the manual are avail¬
able
from
the
Small- Business
Credit Commission, American
Bankers Association; 12 East 36th
Street, New York 16, N. Y.
in

Payments Received By

Policy Holders
American

policyholders

and

beneficiaries received $236,574,000

reported by the Institute of
So far this year,

have averaged nearly $15,000,000 more per month than in
1945.
The Institute on June 27
they

added:

"April
payments
were
8%
greater than in the corresponding
last year
and the four

month

payments

have failed to overcome the trend*

to monopoly. If economic liberal*
ism is permitted to fail, it wijl be;

vice

who

those

frontiers
There

have

history

purpose

pro¬

the readjustment of the
of justice."

gress and

been

when

conscious

few times in

could

men

they

today oi
working and living in the first
hours of a new age. The world is
slowly emerging from a war un¬
equalled in its dimensions and
as

are

shattering in its efects. Strange
complex
developments
in
science, in society, and indeed, in
nearly all phases of our intricate
civilization
require the highest
and

order of

$58,-

policy

in the payment

was

for emergency uses.
up

55%

values

surrender

cash

These were

last

April

over

year;

showing a marked increase in the
upward trend begun shortly after

Day.

months, they were
surrender

for

four

first

the

For

44%.

Calls

are

still,

values

however, only about half the pre¬
war

level.

benefit

"Death

counting

for

payment

payments,

ac¬

half

the

nearly

total,

were

somewhat

attained.

tal claims."

were

still slightly

World

War

involves

difficulties than

many

were

pres¬

ent in 1919.

period last year,

well sacrifice the whole structure •

war

death claims were ac"

counting for

over

10% of the to¬

need

firm in

are

eliminate

We know that it is given to this

generation

make

momentous

destruction.

mass

discover

must

solu¬

democratic

great barriers to

None!
if

(

future

our

eco-.

Monopoly in the American
Economy
t

■

would

underestimate

rising

serious

involved.. The

of monopoly in the
has acquired

power

American

error to
and:

grave

the

tasks

economy

groportions
unprecedented
in our
istory.
Unless
this
of
power

monopoly is checked, we shall be!
compelled either to submit to eco¬
nomic

planning by the monopolists

themselves

political

exert

sovereignty

liberalism would

ize the existence of democracy it¬

the

self.

pass

nomic growth.

economic and politi¬
cal dilemmas or w.e shall jeopard¬
new

determination to

those conditions in

choices for good

ments

liberties.

come
our

our;
industrial life, which.constitute the '

nomic

affairs.

complete

over

eco¬

either

case

to exist as-

cease

guiding philosophy of

our na-

tion.

Responsibility of U. S.
In

the

transition

this

States has

Let

United

responsibility and

opportunity which are unique. Gn
the economic level, especially, our
critical.

role

is the

economy

tive

the

unit in
in

cess

The

American

greatest produc¬
world.

this

utilizing

Our

suc¬

industrial

for the attainment of our
own
prosperity will exercise a
major influence on the health of

power

the world economy.

review

From

the

time

try in the world. There
tinent

ventions to create and

to perfect.:
Opportunities of every nature far
exceeded
the capacity of those
who sought them to exhaust. But;
,

American

people

lem of

both

abroad.

own

our

this

liberalism,

country

and

nation, with its
potential, its

really;

growing prob¬

monopoly, and this national

the

Sherman

Act;

which

tremendous economic

recognize today

tradition of economic freedom, its

charter of economic liberalism.

imagination

and

know-

think of it will

ination

and

Nearly every other major in¬
dustrial nation, either because of

War.

impact of war or because of
continued inability to resolve an
crisis, has lost faith in

economic

abandoned
free enterprise and adopted some
form of a managed or controlled
economic

liberalism,

is therefore crucial
for those of us who adhere to the
economjr.

economics

free

society

powerful and

concen¬

trated economic groups. The needs

perish.

the

the American

notwithstanding the Sher¬
Act, and as a result of failure
enforce it, many fields of in¬
dustry have come under the dom¬
man

the capacity to

liberalism

But

how, cannot demonstrate in peace

provide full pro¬
duction, full employment and ris¬
ing standards of living, economic

culminated in the passage

concern

Eighties the

became

the

economic

was a con¬

discover,, towns and',
cities to build, industries and in¬

concerned with the

•

was

American economy will determine
fate

nation

freest economic life of any coun¬

in the Seventies and

Moreover, what happens in the

history.

some

this

established until shortly after the
Civil
War; /it had; perhaps the

pressures

of the first World

accelerated

the

growth; of

economic concentration, so that in
1919 it was already apparent that

monopoly in its
to

come

the

guises had

many

America's

problem number

economic

one.

following

decade

the

American economy ran the gamut'
of boom and bust. Again, because
we

had

become tolerant of

mer¬

deluded by size and unalert

gers,

of the ends and to the significance of monopoly
make power, the anti-trust laws
lapsed
our economy work. We must also
almost into disuse.
Wave after
have a distinct understanding of wave of consolidations
swept over
the conditions and trends which industry.
One
agreement
after
most seriously threaten the sur¬ another eliminated
competition, or
vival of the system of free enter¬ fixed prices, or divided fields of
prise.
production. It is common for us

have

clear grasp

that are necessary to

There

are

many

who feel that
They be¬
of enterprise is

to think

of the Twenties

the die is already cast.

eminently

lieve that the age

terprise

over,

that we can no longer ex¬

pect enterprise to assure an ex¬
panding economic life, and that
consequently we must inevitably
accept the, displacement of free
economic institutions by the blue¬

prints of a managed economic
system. They point to the current

way to

controlled and closely

administered economy.

.Unless we have irrevocably sue*
iumbed to economics fetalis^ a

this

was

pre¬

period in which

en¬

unrestricted. Actually

far from the

was

happened
another

was

came

that

case.

one

What

field after

under the domina¬

tion of the industrial giants.

When
activity in the formation of car¬
tels and combines had reached

all-time high, the free market had
been so thoroughly weakened that
it collapsed under the
weight of restrictions.

All of

are

crushing

familiar with the

sequel
tions.
both

to this era of5 consolida¬
The great depression3 had*
economic and political ef¬

fects.

Not only were millions of
people impoverished and deprived?
of economic

when

cherished

oUr

of this

formidable

compari¬

larger than in

vigilant in the safe-'
guarding of their economic rights.'
If the economic basis of-liberalism,
in society is undermined, we may.

ability.
the aftermath of

our

perplexities of reconversion, to the
disputes between labor and man¬
son
with the preceding month
agement, to the action of other
and with the corresponding month countries, and to the confusion in
economic
thinking, to support the
in 1945. For the first four months,
contention that we are also on the
however, death benefit payments
smaller in April, both in

because the American people have
ceased to be

In this respect

means

the corresponding

be reduced without

were

Largest part of

6%.

enterprise disap)* -.
do so because we;

give expert and disinterested ad¬

creative

American Life Insur.

they
endanger¬
ing national security or causing
unjustified hardship.
All these
measures are
necessary but they
are no substitute for
specific price
control until fulL production is
can

have

Association

Bankers

can

it will

pears,

trouble of thinking, but ready to

tions to

V-J

supplement

desirable.

and the Small - Business
Credit Commission of the Ameri¬

end, I have directed Mr. (the increase

executive agencies of the govern¬
ment which can assist both indus¬

the

rockets, plagues and other instru¬

months'

Steelman to coordinate to the full¬

jlove with precedents and the easy
maxims which have saved

practices.
With this thought in
mind, the Agricultural Commis¬
sion, the Committee on Consumer

537,000,

e^ternrise is either- inevitable

or ill. We must
interest in this type of work toward lasting peace or wc
lending, although some are not shall risk incredible devastation ir
familier
with
the
established a war fought with atomic weapons,

Credit,

341)

page

strong

have made and to

gains

(Continued from

ibeen schooled, not too much in

equipment

again becomes available to them.
Other
banks
have
indicated a

continue moving ioward our goal.

costs

But as the seventh report of the
Reconversion Director points out,

Administration

mined to do

the

of-

Many banks in every
section have had satisfactory ex¬
community.

it is

(Continued from page 338)
The

and

their life Insurance
companies, bringing to $974,160,000 the total of such payments in
the first four months of the year,

Unduly Magnified: Truman
only slightly above two-

the

industrial

advanced

highly

Life Insurance.

was

their

to farmers, the
Association has

services

lending

American Bankers

the

The Futuie of Economic Liberalism

meet the needs of country

; .To

in April from

Recouveisioit Setbacks

work

Equipment Financing

Thursday, July 18,1846'.

but

hope and opportunity,

industrial

expansion practic-

moment'sreflections wilidispel 'aMy-^ceased; Desperatetexpediente
were
a d opte d
both here and
any belief tnat the disappearance

Volume 164

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4508
I

ff.'

*ff~'

and

abroad to revive industry and to

rise in the number of mergers

employment. When World
War II began, this country had'
not yet completely recovered from
,the > efects
of
the
depression;
Nevertheless, when the American

acquisitions. In the last quarter of

give

people were called upon to pro¬

duce and

proved

fight, they

to the v^orld that the

once- more

freedom, once it had
been marshalled, was invincible.
of

genius

has

The time

during ; the
We know that it is within our

war.

the mistakes of
1919, but we also know that it is
Immeasurably more difficult to do
^o. The reason is not far to seek.
A careful and precise study of
in World

economic concentration
War

has

lished

recently

pub¬

been

Business

Small

the

Committee of the Senate. Its con¬
clusions

are

startling

-leave

for

room

concentration

surmise.

of economic

the hands of

and

its

clear that they

implications are

The

power

few small vested

is today higher than ever

groups

.before in

country.
How did this happen?
our

It hap¬

mergers

in manufacturing
time in the previous
fifteen years. This consolidation
movement spells further reduction
in
the number of independent
and

concerns

increasing

.source

materials.

war

has

xactuiing industries.

true

condition holds

de¬

and tech¬
nology, nearly all of which prom¬
velopments in science

ise to have

severe

shortages of

and

the

which

enor¬

ex¬

undertaken. As

result sixty-eight

top
corporations received twothirds of the value of federal re¬
search and development
and

the

contracts

top ten corporations re¬

of all wartime
research contracts. This means, in
ceived nearly 40%

that the few entrenched
which dominated research
the

effect,

before the war and carried on

recognize that access to

opportunity to enter the mar¬
ket and to develop. Yet we must

full

use

our

resources

after time

covered. Time

unless

that

some

found to provide

are

the

with

chance

small
to

ac¬

was

un¬

quire know-how or to develop
new inventions,
it will be almost

be¬

impossible

the

for

new

concerns

compete.

of planned scarcity
materials, and almost

aware

came

in essential

fact

the

means

control.

•Restriction after restriction

earlier

referred

definition

Thomas

democracy

invariably such scarcity could be

Mann's

attributed to the presence of car¬
tel and monopoly interests. Be¬

government inspired with con¬
sciousness of the dignity of man.
How can this consciousness exist

cause

competition and independent

monopoly. In

upon

necessary

which

industries

had

monopoly

prevented

from

Small Business

Inescapably, small business suf¬
fered

severe

setback

the

production. As
1943, President Truman,

process

"early as

"Post"

few days

primarily that it can 'rig' prices
as
it sees fit, or because it can
regulate production for the sake
of higher profits. These are but
symptoms
of the real
cancer,
which consists in depriving in¬

coming into existence.
Setbacks to

dependent on Sfo

are

ago, from the pen of Francis E.
McMahon, crystallized this aspect
of the question:
"The curse of monopoly is not

for the government

create whole

many cases

many

the New York

ernment had no choice but to call

was

few? A statement which I, read in

fields of industry, gov¬

many

war

of the

dividuals

economic power

in-

essential to their dignity as human

.vestigating the national defense
program, pointed out that while
at the beginning of the war one

free but a
servile state, in which the many
are
wholly dependent upon the

"as

member

(hundred and

the

Senate

beings.

few who

seventy-five thou¬

not

own

hundred

large

corpora¬

new

un¬

anti-trust program of

greater

proportions

than

of economic power, and eliminate
the grip of monopoly on enter¬

prise. The American people have
undertaken

pursued. Our present facili¬
ties are grossly inadequate as to
funds and personnel and this sit¬

never

uation

directly at stake. Upon the out¬
come will depend the fate of eco¬

now

must

corrected

venture
and

necessary

maintain

made

our

give

every

will

possible

necessary to
vigilance
which will
powerful groups in

attempts

economy,

either

exempt

themselves from the operation of
the anti-trust laws or to frustrate
the free market by collusion.
I

that

believe

this

course

vigorous enforcement of the anti¬
laws

trust

and encouragement of

small business is in

nomic

and

with

liberalism

it the

this

complete

ac¬

postwar program set forth by pub¬

agencies

or
private groups
complete agreement on
the necessity of vigorously enforc¬
ing
the
anti-trust
laws.
This
recognition
reflects the under¬
lying feeling of the American

indicated by polls in
85% expressed support of
anti-monopoly measures by gov¬
as

$338,-

in April, the Department

Commerce

represented

announces.

This

9.4% increase

over

$309,600,000 reported in April
The Department's advices

also state:
"For

the

three

months

ending
in April, dividends totaled $884,600,000, or 5.2% more than in the
corresponding period of 1945.
"Largest increases in the threemonth comparison were scored by

railroads,

up 65%, and trade, up
The marked rise for rail¬

16%.

the

prise.

light of these facts, it
said bluntly that Ameri¬

liberalism must

most

not

arduous

test.

designed

''the smallest part and

proportion

humanity,"

tout is rather the set of
that seek

meet its

Liberalism

economic dogma

to benefit

least

now

the

best

attitudes

interest

of all

the
people.
Liberalism
fosters
variety and independence, and en¬
courages criticism. In these quali¬
ties lie the hope for economic
progress

and the protection of the

public against the abuses of eco¬
nomic power.

In these premises is
the surest guarantee that can be
given of steady economic develop¬
ment in our society.
The performance of
can

economy

the Ameri¬
during the war, and

Acres

vested.

July

last

year,

cultivation

and control. This is

(1935-44) average, were 17,749,000 and 25,608,000 acres, re¬

the planting

Texas,

of extremes.

Texas

loss of acreage

some

due

was

mainly to

dividend

comparable

1945 period. In
nonmanufacturing divisions

other

gains

ranged

washing

a^fcer industry
industrial
•is now

demands

ruled by an
giant before the war, it
was

dominated by

colossus.

begin
sion

est

shall

corporations now hold roughly
two-thirds of the nation's usuable
manufacturing
facilities.
These
two hundred

and fifty

once

the

then that

genuine

peacetime

will

downward

from

10%.

relief in late June, and farmers
there were prevented from plant?
ing their full intended acreage for

the sepond consecutive season.
In Arkansas and Oklahoma, un?
favorable

weather

limited

many

lowlands

growers

half of these States.

favorable and farmers

was

were

generally able to clean the

crop.

With considerable replant¬

three-month

ing and retarded growth, cotton

dividends

payments

of last year.

in many areas is later than usual.
"Among manufacturing indus¬
In
the
three western
irrigated
tries, the greatest increases were
in transportation equipment with States,
cotton
has made good
a 22% rise and paper and printing
progress although irrigation water
with a
14% rise.
Textiles and
supplies
in Arizona and NeW
leather

advanced

7%.

However,

dividends of the electric machinery

Mexico

below average.

are

American

Egyptian

fluctuations

corporations in 1939, Sixty-three
"of the largest manufacturing cor'porations have sufficient liquid
asets to purchase all of the usable

retaliation,

can

sell products

1.5% of the peak of 193,000 acres

except
equipment."

transportation

grown

July 1, 1946 is esti¬

year's

last

acreage

in 1942.

offer to seff,

or a

solicitation of

offer to buy

offering is made only by tfie Prospectus.

is already uri?
th^ha^p

$1.25 Par Value

PRICE $10.00 PER SHARE
be obtained in

any

state in which this announcement is circulated

only from such registered dealers as are offering these securities

compliance yitfi the SQWitm

in epch state.

we are

Baker, Simonds & Co.
The First Cleveland Corp.

Wagenselier & Durst, Inc.

Allen &

Company

First California Coippany,

Foster &

Marshall

Macfcybin, Legg & Co.

|eir{cS|r iCir|clgnd & Co.
Taussig, Day & Co., inc.

such a 'developmehl
(' der *wiay%

Common Stock

the

government-owned facilities^ or to prices.; that are pot fixed, thejm
P!4£chase the assets pf seyenty-bpe yyjil. to£ $cp| Tibpe of ^voiding §
thousand small corporations. That severe? ^pregsion*
to reestablish the cpn-

Frederick S. Robinson* Co., Igc.
July IS, 1946

dustries

cultivation

point in our
history will be crucial and it is
not far off. Unless independent
concerns can come into being, can
enter the market, can gain access
to the new technology, can pro¬
duce without fear of monopoly

.!r.

mated at 2,800 acres, less than half

destined to experience

severest

cotton

industry were down 11%, and of
the food, beverage, and tobacco
group were down 8%.
Declines
ranging from 2 to 6% occurred in
all of the metal manufacturing in¬

then know whether we are
more

Throughout most of the Cot¬
ton
Belt, excessive rainfall in
May delayed chopping and culti?
vating. Many fields became very
grassy. Early June weather, how¬

181,440 Shares

rains

excessive

from

during May.
Weather was gen¬
erally favorable in south Ala¬
bama and Georgia, but wet soils
delayed planting in the northern

ever,

these securities. The

The Prospectus may

plant?

had to re¬
plant. While the planting season
was generally favorable in Missis?
sippi, some acreage was lost oh
ings and

"With a decline of 1%, manu¬
facturing alone of the major in¬
dustry groups failed to better its

This announcement is not

expan¬

will begin to contract.

business cycle. That

cor¬

porations either own or are in a
-position to control facilities equal
to those of all our manufacturing

met. It is

the American economy either

The two hundred and fifty larg¬

same

are

resulted

and

omy,

season
Central and
too wet

much

were

today control

•

the ten-

and

year

and

ernment to

can

for harvest is indicated
17,991,000 acres, which- would
be the smallest since 1885 with.
the exception of last year wheiji
only 17,241,000 acres were har¬
at

from

payment in April by a large com¬
pany that made no declaration in

must be

puted at the ten-year average, the
acreage

east

road

strengthen free enter¬

fir$t upturn in acreage since
■
If abandonment is com¬

1942;

was one

which

the

spectively.

amounted

800,000

1945.

flp°As*
Id
northwest Texas, extreme drought
Publicly reported
cash
divi¬
dends paid by corporations in the prevailed throughout the norma J
planting season with oniy partial
United States

the

public,

freedom,

fortunes

were

April Dividend
Payments Higher

of the American people. It is a re¬
markable fact that in nearly every

there

their

welfare

July 1, 1946, was 567,000 acres,
3,2%, more than last year, but
was 28% less than, the ten-yeay
average, according to the Crop
Reporting Board of the Bureau of
Agricultural Economics.
This is
or

cord with the desires and interest

lic

which

their

peacetime

in cultivation in the United States
on

constant

against the
be

business.

mean

Cotton Report
of July 1
The 18,316,000 apres of cotton

Monopoly groups in our econ¬
as I
have already noted,
a greater proportion
tions produced 30%, this ratio had
been completely reversed, so that of raw materials, of plant facili¬
one
hundred
corporations
ac¬ ties, of research and of financial
counted for 70% of war and es¬ power than at any time before the
sential, civilian! contracts while' war. The real significance of this
'one
hundred/ and
seyenty-fiyei condition is not so evident in re¬
thousand
small
companies had conversion, nor will its effect upon
been reduced to a mere 30% of employment
and production be
the total output. More than 500,- felt in the period immediately
000 small business concerns dis¬ ahead when industry is producing
appeared during the war ypars. goods to replace the shortages of
No\y, as this country turns to the war years. The real question
'the building of a peaceful and threatening the American econ¬
prosperous world, we find that the omy 4s whether high levels of em¬
shadow of monopoly overcasts our ployment and production are to
economic future. Where • industry be maintained after the immediate
one

eco¬

opportunity unless we are able to
prevent the further concentration

hardly like the American dream."

sand firms provided 70% of the
nation's
manufacturing
output,
and

necessary

enterprise had been eliminated in
so.

specific

enterprise. It will be

cartels and mono¬

polies, it was necessary for the
government to use the means at
hand when wartime research was

business

cartel

century.

and

do?

existence

face

monopoly

can

aid and assistance to independent

fenced

future

firms, for new
industries and new. techniques, is
the key to this development. But

trial research before the war was

perienced in the production of
strategic goods at the outset
of the war were traceable directly
many

matter

for

grpwt& Opportunity fpr in¬

dividuals, for

really

edge that the

materials

this

scope

peacetime applications,
Because the bulk of our indus¬

technology is of primary impor¬
tance if small business is to have

difficulties

too short.

mendous

there will be neither growth nor

far

consider wartime

action.

What Can We Do?

dertake

Developments
same

to undertake

now

terms, it will be

come

mous

corrective
time is all

What

Concentration of Technological

Much the

begin

concen¬

•long since become public knowl¬
critical

must

tration of control in major manu-

great bulk of industrial research
during the war now have further
control and know-how. We have

compelled to
giants as the

produce

nomic

were

ize

was

warrant the belief
tre¬

portunity for all the people, then

there

1945,

groups

industry, it

capacity

than at any

pened because when this country
went to war and sought to mobil¬
turn to the industrial

present

and acquisitions

economy

to avoid

power

our

and to consume,

that 'this country possesses a

y/e. must assess in unequivocal
terms what has happened to the
American

free enterprise depends, if we are
to
look
forward
to
expansion
rather than depression, if We are
to maintain and to increase op¬

when

come

now

:37J

Sjff.

Incorporated

and

only

viV

JflNANWAI^ CHRONICLE

iTHE COMMERCIAL#

I/Tlmrsday, July 18,1948

goods always led to

an increase
of investment activity the conse¬

Employment Illusions

Full
(Continued from first

quences would indeed be astound¬

ing. It is important that at the
top of the boom, or even at the
early stages of an incipient de¬

ing industries will have nowhere new policy often admit this. The
late Lord Keynes, for instance,
to go and remain unemployed.
before
this war, once
There is much indication that shortly
stated that England had reached
a great part of modern unemploy¬

page)

be
entitled. But this does not dim¬
inish the responsibility of those
ment is due to this cause.
How
jwho in the first instance delttn
much can the measures of soerately chose a popular catch¬
called "fiscal" policy or any in¬
word for a highly technical con¬
flationary measures
accomplish
cept. It is more, than likely that
against this kind of unemploy¬
the belief they have created that
ment? The problem is clearly not
iull employment in the popular
merely one of the total volume of
sense can be easily and painlessly
expenditure but of its distribution,
achieved will prove the greatest
and of the prices and wages at
obstacle to a rational policy which
which goods and services are of¬
really would provide the maxi¬
fered.
Before leaving this sim¬
mum Opportunity of to
plified illustration, let me under¬
which can be created in a free
line a few important facts which
society.
it brings out clearly and Which
are commonly overlooked.
Money Expenditure and

fd • which he thinks himself to

Employment
It is

The Shortcomings of

old story that in most
an
increase in total

situations

expenditure will for a
time produce an increase in em¬
ployment. This has of old been
the stock argument of all infla¬
tionists and soft money people.
And any person who has lived
through one of the great inflations
•can have little doubt that up to
money

Fiscal Policy

that

shown

sufficient

increase

of final demand will

usually in¬
crease employment; they have also
shown that in order to maintain
the level of employment thus
achieved, credit expansion has to
go on at a certain progressive
rate.
This is shown particularly
well by the great German infla¬
tion, during most of which the
level of employment was very
high. But as soon, and as often,
as the rate was slowed down at
which inflation progressed, unem¬

the

are

which

prosperous industries, in
the
increase
in
wages

merely prevents an expansion of
employment and output), but in
the
depressed industries where
wages will be either stationary or
actually falling.
Thirdly, the illustration makes
it easy to see how an attempt to
cure this kind of unemployment

bound

by monetary expansion is

But if the substance of the ar¬

produce inflationary symptoms,
authority, if it per¬
sists in its attempt, will soon be
forced to supplement its monetary
policy by direct controls designed
to conceal the symptoms of in¬
flation. So long as the people in¬
sist on spending their extra in¬
come on the product of the indus¬
tries where output is restricted

gument is not new, the new hold
it has gained on our generation

by monopolistic policies of labor
or capital, this will only tend to

ployment
at once
reappeared,
even though incomes and prices
still

were

rising, yet at a some¬

what slower rate than before.
An Old Argument in New Form

and how the

is due to the fact that it has been

increased total money income

the

figure it would reach if
were employed, every¬
body will be employed.
Could
anything be simpler? All we need
to do is to spend sufficient money
so
that
aggregate
expenditure
can
take care of the aggregate
supply of labor at the wage
figure for which the men will
to

everyone

hold

out.

It is useful at

■

theory

to test this

once

a situation which has
often in recent times.

occured

Assume that in any country there
has been
from

great shift of demand

whether

changes

does

the

of the ex¬

and most

pansionists make no bones about

retain

the fact that they mean to
and

expand controls in order

even

to prevent

the extra money in¬

which they propose to cre¬

comes

ate, from going in "undesirable"

of the

hand

one

same

people

causes

result will be, as was

pressed

this

rather

The first

the case in

countries in recent times,
shall have a group of de¬

side

industries side by

If then, as is the rule
than

creating.

final

goods. In other words, if this curi¬

there will be intense pressure for

insistently demanding

production in the "earlier stages"
of the processes in question will
be multiplied in proportion to the
amount of capital required.
In

medicine,

of the same

though

views it

own

can

goods would be pro¬
time being. This
in turn would undoubtedly lead
to a rise in their prices and the
profits made in their production,
and according to the same theory

do only

such

doubtful, how¬

situation

this should lead to
fore

believe that

by merely maintaining money in¬
comes at the level reached at the
top of the boom they can per¬
manently keep employment and

production at the maximum fig¬
ure reached.
This is probably not
only an illusion but a certain way
to
perpetuate
the
underlying
in

decline

the

causes

invest¬

activity.

ment

the problems of

In many ways

tions

fluctua¬

cyclical

out

smoothing

similar to those created

are

by shifts in demand between in¬
dustries.
The main difference^ is
that

the

case

have to deal not with
what may be called horizontal
shifts in demand, from industries
producing one sort of final goods
to those producing another, but
with changes in the relative de¬
mand for consumers' goods and

exception

the

industries prefers to

take out the

Cyclical Unemployment
The

illustration

may seem
run

ment,

have

Any given increase of prices will
increase
percentage
profits on
working capital by more than

will

happen?

consequence

will

Clearly

that

the

current

belief, which in¬

spires

all the

popular full em¬

has

to refer mainly to long-

technological

and

the

unemploy¬

advocates

of the

that

are

that
not

their

course,

"full

This

admission

employment"

really full employment in the

cure

those I ment

have in the past.

increase of final de¬

capacity will
by installing
machinery, building up stocks,
etc., and for a time outlay will in¬
crease very much more than out¬
put. Similarly in the case of a de¬
have

created

in final demand it will be

crease

possible for a time to decumulate
stocks an machinery and outlay
will be

reduced

than

out¬

put.
When

remember

acceleration

effect

this

that

worksv both

positively and negatively,
equally multiplying the effects of

ways,

increase

decrease

final demand many times

capital sets up a positive
effect, this will be
since much less
circulating capital is required per
unit of final output. The net re¬
sult of the initial shift in the out¬

tal,

experience amply demon¬

strates, regularly has precedence
the

over

for fixed

need

capital.

In other words, the Hmitdd

tal

resources

the

firm will be spent in
which output can be

spend

capi¬

therefore be a net
decrease in the total demand for
will

dustries

ulti¬

goods—caused

investment

mately by an excessive increase of
final demand.

is correct, it is

If this analysis

clearly an illusion to expect in¬
vestment demand to
be main¬
tained

revived by keeping up
An increase
of

final

demand.

demand

final

may

produce this

kind of result at the bottom of a

depression, when there are large
of

reserves

investment

effect:

further
there

resources

have the

will

boom

unused

But near the top of a

existence.

contrary
slacken

will

it will seem as if
an absolute lack of in¬

and

were

individual

vestment

the way in

be cured

most rapidly

in¬

the consumers' goods

lay of

opportunities, which can
only by the government

stepping in, while in fact it is the
policy

increased and the largest aggre¬

very

gate* amount of profit earned oh

private

intended to

revive

investment which pre¬
vents its .revival. Again we find

i.e., I in the
capital, and out¬ that a policy of merely maintain¬
plausibility
lay on'fixed capital will for the ing purchasing power cannot cure
all-round un¬
and that those
time being actually be reduced to unemployment
the

given resources,

form of working

certain specious

mere

demand

revival

may

indeed

than proportional, increase

production. But it

most ridiculous if

to examine its

applied to the

implications for a

dox to which it leads if it is con¬

sistently followed.

Investment Activity

;

true that an increase

demand for -consumers

available for

of working

can

ment

If the

in¬

capital.

There are many ways
this

in which

be done rapidly: working
or

treble shifts, neglect

and upkeep, or replace¬

will 'be inevit¬

ably driven to control not only
the

amount

expenditure

but

also the way in which it is spent.
The worst of the popular illu¬

sion, that

we can secure

full

em¬

ployment by merely securing an

inducement of high profits

adequate supply of expenditure,

of funds is strong is, however, not that the hopes

enough, this will sooner or later
lead to an absolute reduction of

fixed capital.
far this explains only why

the outlay on
So

who try to do so

by cheaper machinery, etc.

and the scarcity

firms

Consumers' Goods Demand and

were

crease

of repair

moment and to consider the para¬

If it

make funds

is utterly in double

fallacious at other times and al¬

part of the unemploy-

we used to

the capital at the

rise,

ited; the need for working capi¬

position which exists at the end
reply of a boom and the onset of a de¬
mainly concerned
pression. It is well worth while

with cyclical unemployment.

tend

policy will perhaps

they

difference

disposal of a given firm is lim¬

fashionable type of full employ¬
ment

same

times more often
as the capital is turned over more
frequently during a given period
of time.
If, then, in a situation
where prices of consumers' goods

get. This argument

because in times of

the

earned as many

mand for consumers' goods occurs.
The

This is

fixed capital.

prices and costs will be

between

de¬

the

because

problem is why in

decrease

any

who lose their jobs in the declin- The more careful defenders of the in: the

profits

lead, to a proportional, or even

given

gain in the form of higher wages sense in which the term is now
rather than in larger employment, popularly understood, but at most
what

before

question

operates in a way which will be
familiar to most business men:

periodically decline, long

monetary

at would, of

present, labor in the progressive

duction

mand the additional

much less strong,

Goods Industries?

mechanism

The

employment and pro¬

the latter,

case

volume

the

acceleration

Why the Slump in Capital

cycle we

and the basic

the

demand

lating

the business *.

reduction in the

output

name

insofar
devoted to create facilities for an as the dependent investment de¬
increased future output of such mand is concerned, and that its
strength depends on the amount
goods.
of capital used per unit of out¬
Purchasing Power and Prosperity put, it is easy to see what the re¬
The economic system is how¬ sults must be if outlay of the con¬
sumers' goods industries is shifted
ever not quite as crazy as all that.
There indeed exists a mechanism from fixed to circulating capital.
Fixed capital means by definition
through which in conditions of
a large amount of capital per unit
fairly full employment an in¬
of output and the decrease in the
crease of final demand, far from
stimulating investment, will ac¬ demand for fixed capital goods
tually discourage it.
This mech¬ will therefore produce a very
much greater decrease of produc¬
anism is very important both as
tion in the industries producing
an explanation of the break of the
The simul¬
boom and for our understanding of these capital goods.
the reasons why an attempt to taneous increase of the demand
maintain
prosperity merely by for circulating capital cannot com¬
maintaining purchasing power is pensate for this. Because, though
the increased demand for circu¬
bound to fail.

ployment" school go much fur¬
adherents

another

of
consumers'
spiral would go on
ad infinitum, presumably until a
stage was reached when, because
people so insistently demanded
current consumers' goods, no con¬
sumer's goods at all would be
currently produced and all energy

policy may help a reces¬
degenerating into a
major slump. But the hopes and
ambitions of the present "full em¬
Its

still further

This

goods.

from

ther.

current

money

sion

the

stimulus to investment and there¬

easy

for

duced

ever,

that

more con¬

be that less

consumers'

uation.
It is more than

were true it would
the result of people

that

sumers' goods would

even

in such a sit¬

harm and no good

theoiy

ous

mean

the full employment

theorists'

employment

the

of "the acceleration

from the production of consumers'

present

that therefore the more we

are

with others which are fairly pros¬
perous.

are

technological

tastes,

of international trade.

many

matter

not

ap-

under

state of opinion
that so long as such a strong rem¬
nant
of unemployment
remains
the

rates,
other de¬ the richer

manding more controls in order to

special

principle., long

economists

it will be inevitable

to mean. And

the rectly dependent upon, and moves
with consumers' expenditure1 and

interest

lower

etc., and on the

investment goods without drawing
labor and other resources away

advocating more credit

expansion,
etc.,

lies in

answer

been taught full employment

now

directions. There is little doubt ployment propaganda, is of course
that investment expenditure is di¬
that we shall see a
good deal

shifts in the channels

progress, or

that

point,

J one group of industries to keep in check the inflation, they

another.

tant

known

possible substan¬
increase the output of

The

princi¬
ple of derived demand." It shows
why the effect of any change in

drive up wages and prices further
original and ap¬ but produce no significant effect
parently much improved form. If on employment. If expansion is
capital goods respectively. The
in the way in which it is usually
pressed further in the hope that
decline in the demand for con¬
propounded, this new theory is
ultimately enough of the extra
highly technical, the essence of
sumers' goods, which occurs in the
it is very simple. What it amounts income will spill over into the
later phases of the depression, is
to is little more than the follow¬ depressed industries, price control,
a consequence of the decline of
ing: if all people were employed rationing, or priorities will have
at the jobs they are seeking, total
employment and incomes in the
to be applied to the prosperous
money income would be so and so
industries producing capital goods;
much. Therefore, it is argued, if industries. This is a very impor¬

restated

to this question and only

further step is needed.

one

would

explain if we

answer

plication

make

have to

to account for the slump in
the capital good industries; But
we are in iact very close to an

are

are practically no
unused resources available which

tially

whether even so far as
$ Firstly; it shows that the sig¬ cyclical' unemployment is con¬
nificant connection between wages cerned, the fashionable "full em¬
and unemployment does not op¬ ployment" proposals offer more
erate via changes in the general than a palliative, and whether in
the long run their application may
wage level. In the instance given
not make matters worse.
To the
it may well be that the general
extent that they merely aim at
wage level will remain unchanged,
and yet there can be no doubt that mitigating the deflationary forces
in
a
depression, there has of
the
unemployment
is brought
course
never been
any question
about by the rise of the Whges

point it is true. There is, how¬
of a certain group.
ever, a further lesson to be drawn
from the experience of these in¬
Secondly,
this unemployment
flations which ought not to be will not arise in the industries in
forgotten. They have not only wcich the wages are raised (which
a

pression, there

practically full employment
though the unemployment figure
was
still well over one1 million.
This is not what the public has

what

will allocate

their capital

for work¬
ing capital and less for fixed
capital, and not why their total
outlay we have to explain if we

outlay differently, more

that it creates

are

bound to dis¬

appointment, but that it leads to

complete neglect of those meas¬
ures

which really could secure a

stable and high level
ment.

further

omy in
can

of employ¬

It will lead us further and
away

from a

free

econ¬

which reasonable stability,

be expected.

;:V.rS

sggwHmatniiiMiiiiitmwJjiiiiioiii*i— -MO** m.

Volume

164

Number :4508

i:HEl COMMEHGlAl;?^MNANClAL" CHRONICLE

Common Sense of ihe People
Proof Against Price Control

make
sells

profit

to you;

on the next car he
but there are also

other profits he will keep in mind
—the profit from servicing your

medical or legal
service, if we are
professional peopled
We like to
get a high price for that side of
liSi

Investors Syndicate

Promotes Officials

v'
^
^
'V ■" • ••
long as *you have it, and
Some of us have not had high
MINNEAPOLIS, MINN. — Di¬
the profit on repair parts and on enough
prices for our production. rectors of Investors Syndicate and
the next car you buy.
(Continued from page 346)
The costs have been hidden
its affiliates and subsidiaries here
by
Then, again, there;s the depart¬ government subsidies or by roll¬ today promoted' 10 members of
^ ^ lightening pre- price control was gone, and that
dictions of what would
backs
ment
all
store
the
talk
of
continuance
where
by
OPA
happen if
was a
decrees. Now these the executive staff.
you
have a
OPA expired. These
Investors Syndicate elected Nor*
costs come out in the
"scare" fore¬ bureaucratic din covering
open.
They
up the charge account.. There is no more
casts
naturally came mostly from crash.
competitive
business
anywhere will show in the cost of goods. So, man B. Waag, chief accounting of¬
^
"
those who want
than in the department store field. too/ will recent wage increases.
Congress to con¬
ficer, Secretary; Dewey F./ Gruen¬
There's
a
second
reality we
tinue
price
control
In a market where
without should face in the same manner. Is it reasonable to think that with
supply and hagen and E. N. Dion, investment
change.
department members, Vice-Presi¬
That is that no one group was hundreds of thousands of dollars demand are free to achieve their
invested in buildings, equipment own balance, through the medium dents, and C. D. McGuiggan, of
j Now we face the realities in responsible for the sudden death
Xvhich we
and merchandise, that the
you
would
see
the the Mortgage Loan Department, a
depart¬ of prices,
live—worker, farmer, Of OPA, The government official
T
:
ment store owner will let you change
clerk, business man, wife and was not to blame—even
come
gradually — more Vice-President,
angels
Investors Syndicate of America,
family. We can read the black could not make such a distortion build up a life-time grudge for a competition in
business, better
few
Inc.,
wholly - owned
Investors
weeks' extra profits?
headlines, the excited predictions really work. There is no law that
•
goods on the selves, more choice Syndicate
of
subsidiary,
elected:
soaring prices, the endless dis¬ could be written or amended that
Wherever you go to spend a
James S. Lane, Secretary; Harold
in,
the
things
you need.
cussions
of
price control-—and could control the complexity of hard-earned dollar, you will be
K. Bradford, Vice-President; J. H.
them go to the
Meanwhile, remember that there
butcher, the baker the daily lives of 140,000,000 free dealing with people—decent peo¬
and the
Ridgway, Chief Mortgage Loan
department store and see citizens."
ple, smart people, Who can be are some who believe in perma¬
for ourselves.
Officer, and Messrs. Gruenhagen
counted on to see a little beyond nent
price control.
They are the and Dion, as Vice-Presidents. Alt.
the end of their noses.
Business Men Not to Blame
^
One teon we learn in periods
advocates of a controlled
are officers of the parent com*
economy
The business man was not to
One other thing along this line
S is that news -'mostly
as
a
permanent national policy. pany.
dwells on
abnormalities. News, as blame for the "death of OPA. of common sense. All these people
Directors of Investors Mutual,
the saying
goes, is the man biting Every tradition in the field of are not only sellers, but buyers. They will be busy searching out
Inc.,
an
open-end k investment
the dog. For
The
the
every price mark-up business was violated by that act
spots where things go wrong,
grocer sells to you but he
company
for
whom
Investors
Which made the
headlines lately, —the tradition of service, of com¬ buys from the manufacturer. The where
there
is
an
occasional Syndicate is principal underwriter
there were
manufacturer
sells
to
the
thousands of prices petition,' of finding a way to a
grocer chiseler.
and investment manager, elected:
maintained unchanged
after OPA bigger share of the market by do¬ but he buys from the producer.
Ralph J. Faville, of the Invest¬
We
who
expired June 30.
And
operate
America's
the
ing a better selling or producing
producer, who sells to
ment Department, Secretary, and
the manufacturer has to go out business establishments must take
The proof of price
or servicing job.
Messrs. Gruenhagen and Dion as
control theand replace the thing he sells.
ery will be in the
He our chances on their ability to Vice-Presidents.
The consumer was not to blame
experiences of
will be buying just as closely as
millions of consumers
for
the passing of OPA.
who have
talk you out of a common sense
He had
Investors Selective Fund, Inc.,
opportunity to observe on their the need, and he had the money you. He's a person, just like you.
an affiliated
car

■

own what
happens in
free market.

relatively

for

that

goods

part

are

the

American way of living.
He be¬
lieved in the policy of "work hard,

Reliance

spend hard,

on People's
Common Sense

what's left for

save

The

thing that you like, he
The same things you

same

likes, too.
worry

about,

Individual

worry

him.

average

citizen.

have

American

that

seen

mon sense
go to work
any

com¬

noon

you

was

What

remember

spin

went

years

ago.
Do
national tail-

the

into

the

day of

Pearl Harbor?
the

Do you remember
that followed
that

rumors

fleet

our

land

—

was

gone; the Japs would

California; that

would smash
tis

down, to
common
we

won

faith

air raids

cities?

our

than

oc¬

December after¬

nearly five

It took

week

calm

to work, to use our
sense—but we did, and
our war because
we had

ourselves

and

each

other.

have

Lands

another

right

war

against

now

our

insidious enemy than human be¬
ings from some other land.
This
war is against the forces of
infla¬
tion, of boom and bust, and of
economic

Coin With Two Sides

win

that

war,

and in the same
fashion

too—

about

the

weapon of all
to face

will be

reality—to

use

our

will¬

strongest
our ability
American

common sense.

What is the
this:

first-reality?

Just

Forget whether Congress

the President ended
price control.
Price control was over before
a

^Congressman

voted, and before
President had
written a line
of his veto
message.
" »the

You,

the mercy

the

OPA

of
manufacturer

and will go on

mand.
It's the law that works
when you need a suit and I have
a suit to sell.
Unless your house

has burned down in the
night and
left you nothing but your night

clothes,

you can -wait

even

suit.

little

less

for

get you to buy it
That

will

process

the

suit,

OPA price tag on

You could

see

the ledge.

it in the decline of

quality in clothing, in furniture,
in

service, in portions of restau¬

Your

for

unfair

Common

told

you

that

balance

other,
tires,

omy

will be the

lot

sense.

wheel

OPA, the
our

econ¬

Vice-Presidents.

Robert

sense

the American people.

Peterson,

Investors

vestment
common

assistant
Syndicate;
was named Secretary of Investors
Stock Fund, Inc., for whom In¬
vestors Syndicate also acts as in*
counsel

manager

and

This

announcement

not an

offer

sell

nor a

solicitation of

offer

herein. The offering is made only by the prospectus.

100,000 Shares

Stratford J?en Corporation.
(A New York Corporation)

everyone

part

both have

may

our

COMMON

prices,

does

his

STOCK

(Par Value $1 Per Share)

part.

the
We

Price

$9.25 Per Share

parts to do.

So, common sense tells us that
there always has been and always
will be a natural and automatic

A copy

of the prospectus

may

be obtained from the undersigned

regulator between buyer and sel¬
ler, and that no one has to make
it work.;. It has both
and good brakes.
Our

self-starter

First

reality is this: You
gouged by some vague
thing called "business," or "distri¬

can't

ample.
know

mon

Straus 8C Blosser

profit

years than in

realize that there's
for him in keeping

squeezing

Irving J. Rice 8C Company

First Securities Company
of

Andre de Saint-Phalle & Co.

few un¬
in the next

Taussig, Day 8C Co., Inc.

Bull, Hclden 3C Co.

you

for

good?

town.

Childs, Jeffries 8C Thorndike
Incorporated

•

He will want

Chicago

Grubbs, Scott 8C Company

.V..

Hancock, Blackstock 8C Co.

fair dollars out of you
months and losing

few

your

Coburn 8C Midd ebrook

you as a customer for another ten

Johnston, Lemon & Co.

Take your grocer, for ex¬
He's a real person.
You
his name and he knows

sense

Colony Corporation

Courts & Co.

Nugent 8C Igoe

principal

underwriter, and Messrs. Dion
Gruenhagen, Vice-Presidents;

and

Or let's look at the auto dealer
sense

real

now,

making
suit, my part the selling of it.

rant food.
„

common

American with

Whatever happens to

pro¬

prices —people were no yours. He has been
serving you
longer buying houses; they Were for ten years,
possibly, and he has
buying housing, and thus escaping had to worry arid hustle to
keep
rent-controls.
your patronage. Isn't it just com¬
by a glance at empty
shelves—no merchandise, but with

one

now.

tomorrow and forever—and it's

high

over

faith in

as an

company's legal staff, Secretary,
and Messrs. Dion and Gruenhagen^

longer you wait, the
begin to think that I could

people.

that price control

people,

but

The
I

under-the-counter

see

person,

man

Edward M.
the
parent

new

Let's forget labels and abstrac¬
tions and just think in terms of

You could

few days

few weeks for that

You saw1 it in the black
market, in the tie-in sale, in the

Was

shoes

other

business

company, named
Burke,
member of

Supply and De¬

was over.

goods only a
You saw it in the
buying of real estate at

not

working.

It's the law of

bution," or by just "retailers"
"manufacturers."

distress

wheat,

take

We still have the

the average consumer,
could see from day to
day that it

few could buy.

something

are

strongest law of all to protect us,
and, believe me, it is working now

our

without

merchant,

long

faith in each other and
ingness
to
work; the

that

the farmer.

production of goods for

the

ought to get out

consumer

the
or

de¬

own

all,

minds

our

cure

our

that

happy to

few of them.

First of

sure

^roduction-^this time

realities

side

one,

They are even more
important than those who have
just recognized. Let's take a look

feated the Japanese. Our
weapons
will be

consumption; another will be

the

other

for

ahead?

take

disintegration.

shall

corn

lie

The last and most
dramatic

the

ducers—of

What Lies Ahead

number

of times. So
have you.

casion

that chance—so long as you think

day."
Everyone may not
Finally, let
us
use
common
like that policy—but it's a reality
Once again in the
past fortnight
sense
on
one
other point: Each
we have seen
something we all through which Americans have one of us is like a coin with two
know
more
but
telephones, more automo¬
occasionally
forget,
sides.
On one side we are con¬
that
one
thing is the common biles, more machines — and more sumers and like to
buy cheaply.
sense
zest out of life.
of the
rainy

open-end investment

analysis of the situation.

THE

yields do not provide the Treasury with any . material benefits
.cooperation between the and benefit . instead:, .only , those
Budget : Message of
1946 as follows: ."Close

President's

January 14,

Analysis of the Federal rapidly
Reserve
Board Report
views and the philosophy that |Treasury
Wartime

Department and the (who might; sell securities previously > acquired. The decline in
other words insofar as mbrie--fit difficult to agree with much, of | it possible to finance the most ex-1 open market yields during a pefactors are concerned we | the reasoning or with the princi- J pqnsive War in history at low and jriod in which. Treasury offerings
two different phases of the pal suggestions which the report [ stable rates of interest."
[ were virtually unlimited was in- _
inflationary problem with which] encompasses.
| With reference to the part that j spired—
deal:
is a fait accompli—
«***»«««
1 tfee Board icflthA
is, now'*/playmg
it
says
(a) Loan
by thefinancings"
methodsduring
employed
by *
Rnard's
as- I
and its Way
volume of money already I ^adequate
Definition
of Terms,that rJ financings
that one ofisthe
of War]
* the Treasury
A commonplace
difficulty
theheritages
". . . Board's
as"cannot

which

(Continued from page 335)
reasoning and the implica¬
tions of the Board's report should

re-

duced."

the

fee -carefully

1946

Thursday, July 18.

FINANCIAL CHRONICLE

COMMERCIAL &

[provides their base, one may. find I Federal

Reserve System has made

tary

studied.

have
General

Comment.

deal simply with
with the "alternative
measures'* suggested because
number pf the premises and as¬
sumptions used are controversial
or contentious; some of the arith¬
metic and arithmetical conclu-;
sions appear to be loosely handled*

It is difficult to

one

I finandrips

"the

the report or

some of the discussion and
expressions with regard to inter¬

done

except over *longperiodof

to pre¬
arguments for some
policies of which it disapproves
than for the suggestions which it

the Board's report seems

sent stronger

advances.

the Report,

the relationships
liquid assets*
.current income from production
an<^ emfeloyrhent* of the inflation¬
ary
potential, etc. is generally
The account of

;

between

existing

cooperation of the
maintain¬

the

Federal Reserve in

r >

ing the %% and other rates
"while such Drives were in
.

I paying, v
.
.
(or intention on the Dart of the '
vi]^Aaps-wsummatiOTi of. t&esa
decreases
to | dtff^ent; expressionsof views we I in the Wartime financing rates-It
[
SemsE^o^^a^
say that the-Board shows!
^owever.t^th4'i^ea!^
| full realization that monetary urv under Morgenthau did take :
certificates measures cannot decrease the »«l4SmVsdvimte«f the lower pat-' -.
the moderating factor-^suff^ *£"»*. «
N6X*
by^ar ftpeney of production" can bebe^[aiavwurfhi?
^
When offeringsthe.. Sevenths
attained with "continued" and 2/2%
SewlS thro^ lebt retirement Loan , thrive,
-were War-.:
an- •
"effective"
eontrols-or without
IBoard recognizes that tife nouncea ?there was; included a
them.
?n«L
^ecessary! ass"^ce
7/^f 1-/2% bond of 5% year term. This ■ •
the Annual Report it is clear
d
s *+ Hprlino in mterest ^ref.s„Pry. to maintain the. /* % offering confirmed a lower "patthe Board recognizes that con-I-SL^SS "interest rates^t lowl
T- e ♦
tern of' rates," The question is u
structive analysis requires it to L
p7'„.a Jf °
nK^,?p- w'| cSe4jt expansion ■ ta •^ the volition • not whether other circumstances :
aim
at
the
second of these : Me
confuses and obscures^ ; J of the panks, and it excuses this j ^gtifie(j ^his break. in lhe earlier
er

ter

;

(?) Philosophy

(b) by

«*• government

which vanes

mechanics and time, in reducmg the scope qf this I. on wasury
practical banking appear to be fait accompli, the principal ques- jwrtificateg,
confused and* at times* in contra^ ticm (as regardsthe general price fi°£J~ter^
diction. The Board dismisses some l®vel) is not t^ether this already 2.9% on
a
alternatives with, too brief or un¬ increased volume of money will pattern of operr market _ yields
convincing reasons.!: The gist of result in higher prices but wheth- varying from .85% on
rates, market

The Controlling

•

^chain of

and
est

is that

that confuses technical discussions I surance to the Treasury! that the
causation" by which fu¬ Is inadequate defimtion of terms. | rate- of %%• . . . on . . . * certifiture monetization of public debt
In^the gehefal;discussicm rthi»^c«j eate^ will be maintaihed.... This
takes place and unnecessarily in¬ curs in. numerous instances iivthe | assurance is necessary . .. and was
creases the total money supply.
references to interest rates,- For (given because the Board does not
Since, as the Board points out,

created"—and the second

good.
One point that is made,
however, should be examined be¬
cause it seems to give a clue to a
state of mind which apparently

this new lower

rejects^higher II^

When Vinson

Averse comments:

rate possible.
became Secretary

terest rate such as the short-term
The Real Significance of the Elim-1. ^ade
interest rates, because Certificate rate of %% were to
ination of the V2% Prefer-) certificate rate, Had m
such a re¬
these do not correct the first phase increase that all other basic rates
ential Discount Rate.
duction been approved it would
and yet its two main suggestions m the "pattern" should fee ex^
First* it seems that the record have accelerated the decline in aR
.underlies the analytical portion of are limited precisely to only this pected to do likewise., A conclu- |
This decision by
should be clarified with reference interest rates.
sion along such lines might be
the report; to the philosophy second phase.
Vinson
therefore
represented
'.which is inherent in the two prinfrom
thct^i^fexiectiiig, to the action taken by the Board some departure from the situation
One therefore obtains the im- implied
in assuring the maintenance of the
// cipal
suggestions made by the
pression
that
by
confusing
these
thought
that
comes
from
certain
%% rate. This "assurance" was referred to above. In spite of this
:.Board, and to its rejection of more
two phases in the general discus- passages that say that a "major
'"traditional policies."
'necessary"
only
because
the

^ction

short-term

the %%

discussing

the

Inflationary

potential the Board says that the
extent by which the funds avail-

the public will compete
i for the existing supply of goods
able to

and services

depends upon several

things. It then states as the first
Titera "the continuance and effec¬
of price controls " In; a
subsequent
section that refers
back: to this same subject it points
?out that the "inflation dangers
tiveness

:;
'

f have arisen" from two causes* one
of which is "the volume of money

c^r-1 consequence" of attempting to I
deai with further monetziation o*
follow 'the Administration line
debt by increasing "the general
that
a
continuing bureaucratic hevej 0£ interest rates" would be
control over the details of our na- «a fall in the market values of
tional economic life is necessary, outstanding . . . securities ...
This politically expedient philoso- difficult market problems for the
ohy repeatedly shows through the Treasury . . . highly unfavorable
Board s analysis and discussion of repercussions on... financial infactors m the fields of interest stitutions
.
might even weaken
^ates. Treasury borrowing costs, I public confidence in such institu-|

sions, the Board may have
cumscribed its thoughts m order

Board

insisted

debt refor

and in spite of the
eliminating ;"e
the | change
paymen^ program, the market

y2% discount

rate—*

(a) before it

could obtain

longer-term

and

cial

the position of the commerbanking system. It seems to

escence

any

tions." The Board almost

changes in

terest rates or

acqui¬

Treasury to

short-term in¬
financing poli¬

(b) without
rived

exhibited a

strength.
This comes about (as
the Board has described)
from
the

maintenance

of the low

short-

yields and this is why "longpt"*term
rates tend (ed) to de¬
cline." As long as highest grade
term

cies; and

atejy f0n0ws
seology with

from the

Treasury issues has
persistent underlying

having
proper

clearly ar¬
methods to

1 new corporate issues are offered
| in the market, under competitive
bidding, at around a 2.50-^.60%
level it will be difficult for the
"wide Secretary of the Treasury to jusshort- tify future offerings of 2% ^

prevent further unnecessary
expansion
ol ^bank : credi+
(which the Board so clearly
recognizes is inherent in the

immedi-'

this dramatic phrathe conclusion that

by
maintenance-pfvsuch a
into "traditional interest rate" policies
differential" between
which it was impelled by its re- are n0£ 'Appropriate or feasible.'
| and by far the most basic cause is cent pledge of indefinite cooperterm and long-term rates).
marketable Treasury obligations.
yet, in another section, the re: the insufficiency of production."
ation to maintain the /&% Treas- p0rt sayS "there can be no assurThe
elimination/of the %% I Yet such offerings of
The relationship "between the
viiu»»«vW« ^ U1C
,» .
nwtshrv we
effectiveness
of price controls" ury Certificate financing rate., It ance that the process of shifting !
is
not surprising to find, there- from the shorter to the longer- preferential rate did
serve
and "insufficiency of production"
fore, that in the final analysis the Lerrn government securities will contract Federal Reserve
structure on many
is the crux of the broad differ^
bear
most adversely
Board prefers the more bureau- be discontinued unless the shortit was ostensibly
_
ences that exist in regard to the
millions of the country's savers."
cratic of the alternatives.
.
er-term rates should rise to the because "the principal
an The Board, however, both looks
4 desirability
of continuing the
The inclusion in this report by poii:it where'the shifting would no
increase in '.i||gNfe
jOPA with its wartime restricdisfavor on "further declines
the Board of its views on the de- ionger be profitable
. ."
. . V is to shift
se- with
in the rate structure" and is opl^tive powers. No matter how this sirability of continuing effective
The Board also shows that it curities
from '^he
basic question is decided or what
price controls until the "insuffi- thoroughly understands one ma- banks to the R^sorye
the better answer may be, one
ciency of production" is corrected
ior cause Df this shifting between desire on
bwtvof
f jcannot ignore the fact that the in¬
seems
to represent the corner- matUritv groups on the part of banks to
crease in "the volume of money
stone for the main theme. Unless investors and the conseauent debt J from the
now
lalready created" is "one cause" of
one
is willing to accept these monetizati0n bv saving that it which followed the
1 iouir inflationary dangers and one
'comes about because of the dif- thte preferentialwrate was
ference between the various rates equivalent of argincrease in re- any
existent in the market.
On this serve requirements.
This advertisement appears as a matter of record only and is under no circumstances to
subject, but in a different section
■ Perhaps the major result of the
.
be construed
offering of these Sharesfor sale, or as an offer to buy, or as a solicita¬
it states: "Another factor conducombination of the
discount price
*

other,

already created" and "the

underlie

the Board

the rationalization
of the predicament

—y-

not
to ury issues may^ be necessary if we
credit as I ®re
(which) '
'designed to dc | m the rate structure Iwnicnji
effect of
requirements
vT;:Government
commercial
Banks." The
thq'
commercial posed to "a higher level of inter- ,
redd&*|heir borrowings est rates than the government is
Federal-Reserve Banks
paying." Consequently the
elimination oy Board's desires apparently narrow
the to a stand whereby•

as an

tion of an

offer to buy, any of such Shares, The offering is

made only by the Prospectus.

2Vz% Treasif

further price J»crea|es to
;longer-term bonds but would also
have to oppose^ amy c!^
that carr;ied the .issu^ t>ecredit expansion dur- elimination and jhe accompany- low a one or two point pr
.
ing the War
the maintenance ing statements pas to change Numerous su^gestmns have been
wide differential between something that was believed to be made that offerings| of such obi
long-term interest a Wartime expedient (and, there- nations should be
tn ?prnnpp
with reference to the f fore, perhaps&l^porary) into £ f
"shorter-term" yields that were a Peacetime move which, because of pne* market demand
ci
of the
financing pattern its timing takes on a greater de- mvestment neeas.
ime ooaru,
that these "were prevented gree of permanency. The defense J
by Federal Reserve | which
Ronrd accordq these I of marketable securities- unless
cive to bank

was

NEW ISSUE

99,750 Shares

Electric Power

Equipment
Corporation

v//

Common Stock

(Par value 10 cents per share)

Price $3 per

the

short-term and
rates." Then
part

war

it says
from

Federal

rising

offer these securities under

applicable securities laws*

July 17,1946.

:
.

while ;

...

;

segments of,
in the position whereby
tw^n the part that it played ih |
^ I^ has;: bear Tainted out that I they might have to defend one .
unnecessary bank credit expan- j such
declines^^ open market I inte?.est rate subsidy against a
sion during the Wartime period ——
W . ■
lower one. This is difficult and
the part which it currently u
'This was originally especially . ,
.
issuance of nonplaying along the following lines', j directed toward e n cou rag in e-1 furthermore tne lssua
e o?
With reference to ther Wartime {banks xo purchase ;
short-term} marketable securities would , ap—.
policy the Board quotes-teom1 tfe^'teW-J^eld^i^ues.'"^ ;
*•
"pear 'ta serve no- so/und. purpose
bilities."

Board

The

Buckley Brothers

moves!

...

Copies of the Prospectus may be obtainedfrom the undersigned, only by persons to whom the undersigned may legally

Reserve

and as a
particular
consequence
longer-term rates
tended to decline." In the earlier
I BWght
stimulate
reduce"
such credit expansion.
discussion the Board also says in
indefinite "permanence" inherent
C11the Board
°
Therefore,
suggests at
reference to the general expanone point that any new issues of
sion of bank credit—"it is this in its present ponies of cooperaf
' '
I +hfc kind should be "non-marketchain of causation that has to be {tion.
prevented
by having the gov¬ How Controlled jFinancing Meth-1 able" ones. This suggestion,
ernment discontinue its creation
ods
Lead Id Demands for not strongly pressed-by the Board
of bank credit
The creation of
Further IHjfovations and Con- jn ils discussion, is dangerous beunnecessary bank credit .
is t
Arois. y
cause over a period it would place
the
particular concern of those
During recent discussions of the L
.
•
charged with monetary responsi¬
decline in the ope^ market yields j iarSe
n ~ ^ v

support to the- market,

differentiates

be-

governmeiiijkpi^ other securi- yestors.

and

. .

ItfWUHUg

•

Volume. 164

Number 4508

THE COMMERCIAL & FINANCIAL CHRONICLE

that could not likewise be served

by marketable securities.^
ji

>#yv

•

\\V*> ;v1S

•

addition, the current debt

repay-

ment * program(which* is

essen-

dally.one part of a large-scale re¬
Practical Difficulties In
Achieving
funding program) will reduce the
Transfer
of Bank -HeM
propqftion of short-term market¬

-■

I^^S'Xerni Securities,

►
.

debt

able

The.Board then suggests.atthis
point that in order to meet the ex-

materially

than

and

forty-eight State bank super¬ measures" suggested and the en¬
visory agencies. In England and larged powers that they entail
Canada, v the
countries
usually without considerable misgiving,

cited In connection with

voluntary

;

Board's First
Measure,"

"Alternative

may

»•-

•

•
.

term holdings to non-bank

invest--

org." .This.ignores the fact that
commercial banks hold relatively
ties.

Furthermore .the Board fails

to explain how the

yields

Securities could be^ made

such

attrac¬

tive to non-bank investors, or the
effect
that success along
these
lines might have on the over-all
structure of rates.

■

Controls.

bank

one

factor

credit

side of that wide differen¬
Also that "as a consequence"

one

ent

bear most ad¬

consequences

by stating that

the necessity for maintaining the
short-term rates arises "from the

standpoint of the government's financing operations" and it opposes
any

increase in Treasury borrow

fng

costs.

Since

these

cost

interest rates at
bank

the

level which ob¬

Board's

credit,

control

the

over

should carefully
that

reasons

gives' for continuing
Wartime policies and rate.

30, 1946 the annual cost
the rate of 5.35 billions.

mated, and if Treasury refundings
made solely in the form of one

point of increase in the level

of interest rates would add
up

February

millions

only

and

the costs of June

30, 1946."
It is

pertinent to point out that

these

costs

are

pr'or

recemt

by the Treasury of taxes on the
interest paid, as is the reported

annual interest charge on the en¬
tire debt. It unquestionably would
would be helpful to a general un¬
derstanding of the burden of in¬
terest on the economy if the gov¬
ernment were to report both the
actual cost of interest on the oublic debt and the estimated taxes

received by the Treasury on these
interest payments. It is the net of

and the amounts

form
The

bulk

questions

af-

Budget,

the

fecting the 'Federal

Member

the Weekly Reporting
Banks as of that date.

Further, that if there

the increased costs "in the nex
few years" of an upward revision
on

1%
rates."

"the. level

interest

Apparently full justifica¬

tion would require that the "nex'
-Tew years" total between 5
and i
and must include an

that

assumption

reduction in the total deb
be accomplished through
out that period.
\
x
no

itable

The weight of the second quota¬

tion

fundamental questiong de
pends upon whether it is: correc
to say that these are more
ponder
ous today than was the case
only
*3 few years ago." I. E. Again
re

how many years are
or

ex¬

The

total

would

banks

for

were no re¬

source

coming

about

from

this

would be of minor concern.
-

reversal

the

debt

such

that

future

xk- Wars last year changed the
pros

pects
able

materially.
to

now

are

look hopefully toward

terest payments
crease

to: popularize the lower of, our
widely divergent financing rates,
General Outline of the Board would now
substitute
Monetary and Credit Sit- a "power" in its
place primarily

the

Our
'

nation?

because of debatable assumptions

The general outlines of

etary

and

clear.

credit

with respect to gross costs of in¬

our mon¬

situations

terest on the public debt.
The
Board adds that "it would not re¬
strict the banks' ability to make

are

achieved an average
cost of public debt to the Treas¬
ury of "less than 2% gross cost."
We achieved
this, however, by

adopting
a

loans

"pattern of rates" with
"wide differential between the

short and long-term issues."

issued

to purchase long-term se¬
against savings deposits."

curities

point is a definition pf
"long-term securities" provided.
Generally "long-term" Treasury

substantial volume of the

shorter

are

than

so-

called

"long4erm." corporate se¬
curities.
A commonplace defini¬
tion in
investment circles for
"long-term" Treasury securities is

banks, the normal
shortening of the combined port¬

measure) a substantially greater
volume of purchases of "over five
year" securities than that which
has taken place in recent years. It
seems

questionable, therefore, that

the Board would have in mind the

customary definition of
term securities."
It

might

would

define

those ♦'over

that

such

for

the

was

low

primarily responsible
average
borrowing

dangers, namely, "the volume

cause

money."
now

This War condition has
been carried into the Peace¬

dous

amount

difficulties

and

securities

administrative

individual; hard¬

The Board refers to the fact that
some-

administrative

assurance

the

Board

that

continue to cooperate and
maintain the relatively low shortterm rate.
v

■>*
situation

this

Board characterizes

"cannot be

which

matter

one

shortly will be of a4errrv less

than five years,.

will

of the two measures outlined in,
order to meet differences among
banks

credit
There

the

which

term securities against savings de
posits" it is questionable whether
the suggestion would have any

indiffer¬

ence" to those

"charged with mon¬
etary responsibility." But, based material
on

the

above

monetary

and

summation

credit

The second measure is

our

situations,

effect.

This is clearly
by Appendices B and
These show that by June 30,

empower the Board to require
that all commercial banks hold a

Board

be
or

says

ihat the banks should

permitted
excess

hold vault cash
in lieu of gov¬

reserves

ernment securities.

The only spe¬

cific

vanced for this "alternative meas¬

1947

Board's report, one finds
it diffi¬
cult to approach the "alternative

of "over five

the

effect

time

bank

portfolios is to reduce the amount

year" obligations

•This advertisement appears as a
no

circumstances to be construed

offer to buy, or

The

advantages

ure"

are

stability

as an

on page

matter ef record only.

offering of these Securities for sale, or as an

offer is made only by means of the Prospectus.

Supply Corporation

(a New York corporation)

28,762 Shares
5% Cumulative Convertible Preferred Stock
(Par Value $25 per Share)

$25

per

Coun¬

tries."

relatively full discus¬
monetary and credit
situation, etc. the Board brings up
the following: "In other countries
a

170,000 Shares
Common Stock
(Par Value #1

have been
better
able to exercise effective contro"
governments
the

Price

amounts of government

per

Share)

this financing."
This

criticism

seems

have

Copies of the Prospectus may be obtained from the undersigned only in such
■■

been

effectively answered, how¬
ever^ by the Board; Immediately
thereafter when it says:
Unitedi States

countries arise
more,

than

and

because

.14,000,

thes$

security tnr

compliance with the securities laws thereof.

"The dif

ferences between the situation in
the

■

qAllen & Company

other

there

are

commercial

range*debt

conditions, and with three Federal

July 17, 1946

are

ad-,

that it would result. iri;
of interest' yields;; on

(Continued

which

solicitation of an offer to buy, any of such Securitiest

General^Builders

our

coun¬

evidenced

and based on the
character of the

This is under

terpart of the first in that it would

Furthermore, since the Board "specified percentage of Treasury
specifically states that it "would bills and certificates" as secondary
not restrict the banks' ability- to reserves against their demand de¬
To
this,
make loans or to purchase long- posits.
however, the

Price

flexibility

should be authorized" with either

the bulk vof bank purchases

The Dissimilarity of Our Situation

sion

ships that could result.

two years ago.

After

one

moderate in¬

"Other

Board

year," or perhaps
by using the words "bonds" arid
"notes" as interchangeable syftb*.
nyms for the phrase "longer-term
securities."
In any event, it 'is
quite easy to envision the tremens

so-called

"longer-term" issues
have been in securities which are

time period by the unnecessary

an item of quite
duration or (b) one
which is far less justifiable today
than may have been true one or

the

considered as (a)

That

"longer-

the changing needs for
expansion or contraction.
can be no question but th^t
rate which we attained.
This was
any such "alternative measures"
accomplished by "close Wartime those "over five years." If this would
be so replete with adminis¬
cooperation between the
Treasury were the definition Which the trative and practical difficulties, as
Department and the. Federal Re¬ Board had in mind when it made to make the red
tape and restric¬
serve System." The
general result' the above suggestion then an anal¬ tions of a wartime OPA rela¬
was a "chain of causation"
which ysis of Appendices A, B and C tively
simple by comparison.
;
;
unnecessarily served to increase will illustrate how ineffectual such
"one cause" of our
inflationary a restriction would be. This is be¬ The Board's Second "Alternative
and this

short-run

With

along

mutual savings

securities

"short-term low-yield" securities

in short-term rates must be

What

Thus
current concern about increasing
bank income from Treasury in

debt total of oniv 250-260 billions
without giving effect to any long
r eduction; programs In

other

tives for this country?

from bank holdings.

come

securities purchased by. banks anc
over the rates paid to
banks for

popular assump
tion for analytical
purposes. The
unexpected termination of both

similarity of the two words, having eliminated one de-"
imitations to recommend either vice (the Vz%
preferential rate)
them as appropriate alterna¬ which
unsuccessfully endeavored

or.Jess have

over

securities."

deposits

folio is such that the banks might
well be able to justify (under this

the

fiscal .position is the,
most important factor in this pic¬
ture. Then, too. the structure of

prospective

was

short-term

here in the

invest savings

similar lines to those employed by

Treasury's

"few"? One

total debt

strict the banks' demand for long-*
term Government securities and
to strengthen their demand for

adoped in Canada is similar to this
imitation." Since the relative sit¬
uations are so dissimilar what is

in the amounts of interest pay¬

ments

debt, and the size of the
^
short-term debt, held promise of
f
being much larger than is true
1: today. A 3Q(1 billion
prospective

would serve to re¬

ability of banks

into

shift

two years ago the

total

measure

the

"longer" securities future increas

would

the

probably continue to be a lesser
To the extent that higher
short-term rates make it less prof^

♦he

"This

strictions

sum.

tirements. will

Apparently t a good portion o;
the first quotation is predicated

true.

received.

fore

paid on the debt to the banking
system than was the case only a
few years ago."

should

and

have declined under this program
increased rates would not cause
an increase
in payments hereto

levels of taxation and the amounts

public debt:*
by

debt repaid

tent, therefore, that bank holdings

Obviously

fundamental

the

This will,

creasing interest rates, as an antiinflationary
influence
raise(d)
more

paid to it in the

interest

1946,

above

billion dollars a year in the na¬
tion's tax bill." This is then fol¬
lowed by "proposals
for in¬
a

be 5.40 billions,

80 millions below the peak cost

continue to

In justification of its statement
that continued maintenance of the
%% rate is necessary to the gov¬

age

holdings.

will need to be refunded in the
next few years each full percent¬

certificates at 1*4%, then

year

ive measures" the Board states
;;hat
"the
voluntary agreement

ait

the

ernment's financing operations the

•

was'

•1

Also that

repayment program
outlined and esti¬

the Treasury has come from bank

Board says "in view of the large
of short-term debt that

•

debt

the

amount

■

As of June

the two which is the real cost of

Board

of February 1946.

the interest to the Treasury.
As regards the banking system

consider

annual interest
the debt was 5.48 billions

principal reasons for continuing a
rigid control over the short-term

are

table

Treasury

the

structs

•

This
of

figures the peak

to
"maintain"
the
basic short-term rate which

versely on many millions of the
country's savers." The Board attempts to reconcile these diverg¬

;

calcula¬

our

score.

basis

"necessary"

the rate structure

1 that
the

shows

of interest would

note that the Board be¬
lieves that "continued declines in

;

tions

continues

longer-term rates tend to decline.

Appendix E includes

of December 1947 the annual cost

Then

govern¬

ment of carrying the public debt."

expan¬
sion but that the Board feels it is

tial.

•

it would

the

•

term interest rates" is

cost

the

are

undesirable because

In summation we find that "the
maintenance of the wide differen¬
tial between short-term and long-

conducive

•

government securities

;he Board states that "this would

Hie Heart of the Problem is the
Short - Term Interest
Rate

•

short-term

long^terni j Treasury •:* securi- increase

billion of such

one

only about

posits

The

agreements, competitive and other
conditions are entirely dissimilar.

have been anticipated. Tbe Each of these countries has but
The first of the "alternative
combined; result,1 therefore, .is, to; one \bank.supervisory authority; measures"
suggested Would. em¬
.f isU^
deficiency : in. the ''supply reduce the potential increase' in There are but IQ chartered- banks
power the Board of Governors to
i-which has occurred from the swift
nterest costs that eould be at¬ m Canada, while in England about
place a maximum on the amounts
reversal of the.
Treasury's fiscal tributed to a higherlevel of shoftdozen banks da most? Qf the of
"long-term marketable securi¬
needs
that
"public
erm 'rates. • J/ r. •policy
;
*
banking businessi.".
ties, both public and private" that
would be well served if the banks
In specifically disapproving the
Nevertheless • in the process of commercial
banks;; may holid
;; were to sell some of their longer- increase in the rates carried
by outlining the first of its "alterna- against their net demand
deposits.
.

that

currently held securities might be
allocated against the demand de¬

376)

;u'V/;

*n ;

■■

■:'

376

,■

v.;'.."

'.V""":

''r

P '■'•

"Thursday, July 18,: 1946

FINANCIAL CHRONICLE

THE COMMERCIAL &

Again this will be mildly

ably largely Victory Loan issues.-.

deflationary because loan decreases will, reduce deposits.

Allen & Co. Offers

General Builders
;

Allen & Co.

Our

Stock

July 17 offered

28,762 shares of 5 %
convertible preferred

Reporter

=====

Governments"

higher acceptance purchase rate by

The

By JOHN T. CHIPPENDALE, JR. l,

cause

the Federal Reserve
importance, be-

of the small amount of this paper

presently-outstanding. . . .
the monetary authorities* by upping
acceptance rate, appear to be in sympathy with the

If does, however, indicate that

stock ($25
v
The government securities markets were upset again last week
par) and 170,000 shares of com¬ as the commercial banks announced a general upward revision in in¬
mon
stock, ($1 Par) of General terest rates on loans to brokers and dealers for carrying government
Builders Supply Corp. The, pre¬ securities, and: on loans to brokers for the purpose of relending to
ferred stock was priced at $25 a customers for carrying securities on margin.
The higher rates to

the bankers'

action

rates.

security loan

commercial banks in increasing their

the

...

HIGHER PRICES?

...

accrued dividends, and
the common stock at $4 a share,
The' preferred stock is part of
an original issue of 40,000 shares.
Holders of previously outstanding
senior shares have
accepted an
offer of the corporation to ex¬
change
their !• stock for 11,238
shares of the new preferred stock.
Proceeds from the sale of the 28,762 preferred shares and from the
sale of 100,000 shares of common
stock will accrue to the corpora¬
tion. .The balance of 70,000 com¬
mon shards is already outstanding
and being sold for the account of
stockholders who will continue to
:<*wn substantial amounts of com¬

Bank of New York does not seem to be of immediate

cumulative

share; ^)lus

HIGHER ACCEPTANCE RATES

'government securities dealers, which will become effective July 22,
raises from %% to "%% the rate on borrowings secured by Treasury

Are the commercial

banks, by increasing loaning rates, taking

steps to curb the buying of long-term issues, witb resultant;higher^
certificates, while on all other government1 securities regardless, of prices?
Liquidation of loans through the sale of government se¬
maturity, it will be increased from %% to 1%. . . . The new charges curities, increases the supply, and y depresses the ■ ■ prices for these
to brokers, making loans; on their customers'., collateral, from 1% to
obligations.
This will no doubt be more noticeable in the re*
1%%*will be in force on July 31. . .. It is expected that brokers, will stricted obligations than in the eligible issues....
generally pass on to customers the higher costs, which have been at
Neverthelessj this seems to be largely a temporary situation,
least y2 % more than the lending rate of the banks.
and the floating supply that will be put in the market will be
Following almost immediately the loan increases by the com¬
digested, because the larger savings deposits and record income
mercial institutions, was the Federal Reserve Bank of New York
from life insurance sales will be put to work eventually. . . . It
announcement that the buying rate for bankers' acceptances with
may mean some price irregularity, hut that affords good buying
maturities up to 90 days would be %%, compared with %,%,
opportunities for shrewd purchasers who will take advantage of
and on three to four months' maturities it was raised to %%
these market movements to pick up needed issues.. ..
Maturities
of
four
to
six
months
were
unagainst % %.
Unless there is a complete change in debt policy, and this in*
changed at 1%,
crease in loan rates is a forerunner of such a development, which is
.

not generally known, weakness in government securities should be
a buying opportunity. . . . This means that scale buying of desired
short-term money rates had its effects on the
obligations should still be continued..;.
government bond market as prices gave way under somewhat heavier
A'jittery, nervous market was the result as bids were
tion will be used to reimburse the volume.
treasury for expenditures incident hit or pulled, and quotations were lowered, as dealers and traders
to the.,recent purchase of two ad¬ tried to figure out the results of this latesi; development in the money
Commercial banks and institutional investors are
ditional
brick
manufacturing markets.
plants $nd two warehouses, and to watching price changes closely but are not inclined to build up hold¬
finance: the cost of improvements ings until there is further clarification of the effects of the loan
to and .expansion of facilities, The rate hardening on intermediate and longer-term maturities. ,

EFFECT ON MARKET

This 1 ightening of

stock.
.yd Funds received by the corpora¬
mon

increased working capital also
Will be required in the anticipated

Ait

Analysis of the Federal
Reseive Board Report
(Continued from page 375)

GAINS WIPED OUT

ineligible bonds in the last few days have given up practi¬
growth of the company's business.
^General Builders Supply Corp, cally all of the gains made in the last two months, showing that the
is. one of the largest companies in technical position of the market was not as strong as had been in¬
the builders' supplies field in the dicated, by the recent display of firmness. . .. . Bank eligible bonds
New York City area. Its principal likewise moved down, but were not as adversely affected as the re¬
The market for government securities, is so
business is the sale of masons' stricted issues, v
and plasterers' materials, includ¬ sensitive because of the absence of a clear cut policy on postwar debt
The

short-term government

securities

(and therefore of the cost to the
public debt)? and that it would
provide a measure for regulating
commercial banks' demands for
short-term securities relative to

their demands for longer-term

is¬

sues.

terra problems, that it does not take much to cause dealers and investors
Aside from affecting the cost of
to cease their operations and move to the sidelines, to see what will
the
public debt by serving to
cofta,- concrete blocks, gypsum
happen.
maintain
"the wide differential''
products, tile lath and wall-board.
There is no doubt that the monetary authorities do not want
between rates to which the Board
to have the market go into another of its upward spirals, yet at
refers, the principal unexplained
the same time ithe holding of debt service within the limits of
gain from this proposal might be
7/g% to 2%% does not allow for increases in short-term rates to
to prevent further monetization of
EQUIPMENT
make them more, attractive than the yields on long-term sen,
public debt.
It must be recog¬
nized, however, that the ''shifting
TRUST
||curities.:;., .PpMi
W:- I','.
.
'¥<
V:'lPPP'ifrom the shorter to longer-term
PROBABLE EFFECTS
government securities" which was
CERTIFICATES
What are the probable effects of this recent stiffening of loaning deemed "conducive to bank credit
rates by the commercial banks and the raising of the bankers' accept¬ expansion" has in some major de¬
ance buying rate by the Federal Reserve Bank of New York? . . . It
gree been a shifting from one year
seems as though the increase in rates on loans to dealers secured by
or less securities
(primarily cer¬
certificates of indebtedness from %% to %%, means that they will tificates) to securities of 3, 4 or 5Offerings Wanted
not be interested in this security, as in the past, and positions will be year term. Since the Board thor¬
Immediate firm bids on
liquidated, as will their loans for carrying this obligation. . , . This oughly understands this we may
cuts dealers' loans and .will decrease deposits to that extent.. . . . be justified in- assuming that the
practically all issues.
Mildly dcflaUdqairy^ because if dealers', loans ^re;t e^mipated, ,in definition of "longer-term securi¬
their entirety it would be only a. fractional' reduction, in outstanding ties" which is a key phrase in each
bank credit.
Some of the demand for cerfifica.es will be taken suggestion might ultimately be de¬
out of the market by this development, which may mean this type fined as "securities over one year"
of obligation may go to 0.875.% yield basis..
or "bonds and notes" to the bene¬
Weekly List
fit of "bills and certificates". Thus
LONG-TERMS SJEEN UNDISTURBED
the real apprehension with which
Gladly furnished upon
Will an increase in the income of a one-year obligation to %% these
"alternative
measures"
request.
make it more attractive lo the commercial.banks (principally), than might be viewed includes all of
certain of the intermediate and longer-term eligible issues? ... the
administrative and market
Government bonds due in 1949 and 1950, may be sold or the deposit complications that narrow defini¬
institutions may refrain from buying them, to some extent, wi;h cer¬ tions of "longer-term securities"
Semi-Annual
tificates yielding 0.875%.
.
might imply.
cement,

brick,

ing

lime,

...

Valuation and
I', :-yy

ypyyp

-P

PIP

•

While the longer

■

Complete dollar appraisal
issued each June 30 and

December 31.

The

Appraisal

Our

experience and facil¬

ities at your

disposal.

temporary irregularity in prices for the restricted

obligations.

It will increase somewhat the floating supply of the

securities that the market will have to digest.
loans will decrease deposits and

will have

ineligible

Reduction of these

a very

minor deflationary

effect..."....

STROUD & C0HPAHY
INCORPORATED

PHILADELPHIA

Pennypacker 7330

POSITION OF CUSTOMERS
The

higher rates that

REetor 2-6528-29
Two private -wires—

;

Philadelphia, New York
Teletype—PHLA 296 & 297

carrying of government bonds

by their clients less profitable and this could bring about selling

longer-term issues.
NEW YORK CITY

brokers will pay for loans secured by

customers' collateral, could make the

...

Banks it is not likely

relations

tomer

place.

are

Due to the warnings of the Federal Reserve
that the member banks will take over these

loans from brokers, but there

will

doubt be instances where cus¬

important enough to have some of this take

" i;

The amount of loans that will be

liquidated because of these

higher rates, will increase the market supply of

securities, prob-?

to reach any con¬

of
of

advances strong argu-*
ments in favor of first attempting

causation"

the

reduce

stress

that results

resorting to
before at¬

from this situation by

methods

traditional

radical ^'alternative

tempting

measures" such

these.

A Relaxation of the Rigid
Over
Short - Term

Controls
Interest

is the Preferable and
Practical First Alternative.

Rates

impractical to aft*

would be

"traditional in¬
extenl
releasing the short-term;

tempt to return to

terest-rate ^policies",tothe
of fully

interest rate from the
of

intervention

government controls. There

is,

every reason why we
should attempt some relaxation in

however,

rigidity

the

months

Some

term" Treasury
were

these controls.
the "longersecurity markets

ago

released fi;om an

wartime
confined

unwritten

restriction which had:
the variation in their

daily price fluctuation to
favorable

was

even

though the

timing at the moment

questionable.

8/32nds

The result

point per day.

seemed to

Since the only
which the
call for further

"alternative measures"

clusion with respect to the Board's board suggests
report and
its suggestions for radical government intervention,,
"alternative measures" except the should we not try out some com¬

Will the increase in loans to dealers for carrying longer-term
government issues result in liquidation of holdings? y. . It is likely
that there will be some cutting of positions due to higher loan rate,
but dealers; have not been too heavy in the longer-term issues for
quite some time. . . . Probably this will lead to selling of ineligible
bonds, and this along with the reluctance to rebuild positions could
mean

Board by ii$ own description
the mechanics and of the "chain

It is difficult

longer-term securities will be noticeably affected.

Special

Adoption of Such "Alterna¬
tive Measures" Is Not Just¬
ified.

WILL DEALERS LIQUIDATE?

Monthly

of satisfactory production andi
employment.
The, circumstances which have
been created In the monetary and
credit fields as a result of war financings and wartime fiscal policy
are difficult ones.
It may well be
that "traditional interest rate poli¬
cies" may no longer be adequate
to meet the tasks imposed, but the

gree

of one

securities of eligible obligations will fluctu¬
ate with unsettled market conditions it is not likely that there
will be any lasting effects marketwise on them from an increase
in the yield of certificates from 0.83% to 0.875%. . . . There will
have to be a larger increase in income from certificates before

Appraisal
■K'Pp

reasonable de¬

ture to attain £fiy

following; The Board, apparently
wished to be on record that it

short-term interest rates?

considers itself impotent under a
situation Which has" been aggra¬

Would appear tft be wholly:
consistent with the real logic of

vated by

certain of its own actions.

parable relaxation in the area

of
s

the Board's

report for the govern- 1

reasonable grounds, ment (the Treasury and the Fed¬
in the light of the circumstances eral Reserve Board) to state that,
as
outlined by the Board itself, its near-term peacetime policy
which could be properly seized would be to permit a freely fluc¬
upon as justification for approval tuating short-term rate on Treas¬
of the Board's
suggestions.
If ury issues of up to one year, pro¬
measures such as these were ap¬ viding that the financing cost toproved it would be possible for the the Treasury were not increased
Board, either by definition of beyond IVz%,
•
.
. '
terms or by changing the per¬
There are a number of students
centages which it would be em¬ of the money market who believek
powered to impose, to create prac¬ that under present-day conditionstically any interest rate on Treas¬ a freely established level for such
ury ; short
and long-term issues securities might steady .within, a
;hat it wished.
In doing so, how¬ range of 1 to 1:V4%.' If .this hap¬
ever, it could and probably would pened to be the case then the
so confuse and obstruct the normal
open-market activity of the Fed¬
functioning
of our
credit and
eral Reserve Banks could be con-banking machinery' as to make it
fined
appropriately to
actions,
virtually impossible for American
which would tend to adjust the
industry, commerce and agricul¬
There are ho

tVo!ume 164
needs for
or

Number 4508

THE COMMERCIAL & FINANCIAL
CHRONICLE

bank credit, expansion

contraction as.the

ipight

ease

If, for any reason Or at any time,
the open-market rate tended to
exceed

tion"

Wz% then the "coopera¬
of

Board ih
would

the ; Federal

Reserve

"maintaining" this

rate

different

the

than

doe H. Davis, V, P.
Of

wide

differential

pay

partment

ouys.

Bank of

the

;

First

/ National

Memphis, Tenn., has been
elected

Vice-

President
the

between

will

continue

that

capacity.
Davis, a

Mr.

native

se¬

up-to-one year term
could advance to 1 Vz % without
causing * the
2 Vz %
long-term

Tenan,

widely-known

Treasury financing rate to be en¬
dangered. If this proved to be
the case then the
"shifting from
shorter to the longer-term Gov¬

and

to manage the
department in

bank

n e sse

Treasury

bond

and

♦

would

ex¬

sort

"traditional

policies" should
should

interest rate

prove

ineffective

endanger

necessary

Treasury financing considerations
then

the open-market activity of
Federal Reserve Banks and
public statements on the part of
the Treasury should prove ade¬

the

quate to the Occasion. If however,
events proved this to be in error
then

radical

such

measures

those suggested by the Board (or
other more suitable ones) could
be adopted. Whatever subsequent

adjustments in interest rates that
might then be desired or neces¬
sary could be effected.

Employees Outing
Exchange,

and

pages

from the floor of the exchange as
well as members of the adminis¬

trative staff, are looking forward
a full day of fishing and swim¬

ming off Fire Island this Saturday
guests

certain

the

ex¬

change members.
The

party will put out from
Bayshore, Long Island, aboard the
power boat Kismet at an early
hour Saturday in charge of Har¬
old A. Baker, an exchange mem¬
ber, Those of the group not inter¬
ested in fishing will go ashore at
Fire Islapd upon arrival there to
swim

the

Fire

Island

ap¬

served

the

commercial

ing division for

bank*

number of years
before being assigned to the Bond
Department. In 1939 he was Mis¬
a

sissippi representative with head¬
quarters at Jackson and in 1942

State

der of the day will be spent with

more, fishing and swimming from
the boat.

Among the Curb Exchange em¬
ployees to be on hand for the out¬
ing are several members of the
exchange twenty-five year club
including Charles - Vernon, man¬
ager of the exchange trading floor.
George; Johnson, assistant floor
manager, is in charge of organiz¬
ing the outing group,

came

Manager of the Department.

of John M., Saunders.

League Standings
M.

by tying the New York Curb Ex¬
change for the lead in the "Longs"
Division of the league with eight
Wins and two losses. The tie will

be played off Thursday, July 22,
to determine the pennant winer of
that division.
The play-off winner will then
meet Hirsch &

Co., pennant win¬

games

scheduled

are

for

the1' "Shorts".

pennant wittt -ten
tories and no losses.

Division

straight vic¬

LEAGUE STANDING

P. V.
C.

;

Won

Exchange

Poster

Loeb, Rhoades

N. Y.: S.

Bond

Lost

Pet.

.800

f .800

,600

Brokers

.400

Jacquelin
Goldman, Sachs & Co.-™.

.300

.100

Carlisle &

"LONGS"

2, 10

DeCoppet

& Doremus„—
Upham & Co

Lost

1.000

"\600

.556

.333

Merrill Lynch, P. P. & B.«

.300

Onds

.125

Security Traders of

Bros.

Bonus to

der

its

service,

Mt.

based

Company, and

partner of Saunders,
Bennett

was

Olsen

Bros.

He has been well known

La Salle Street for

some

years.

regain

increase

will combine toward deflation

the

one

hand and of her

iteis and
abroad,

urgent needs for food, etc., on the
other, that does not seem bad.
Neither does comparison of the

As
and

export figures with those for 1945
when the exports were

million pounds, nor even with the
pre-war years of 1938 when
they
were less than those
for 1946

ditional

for

she

deficit

her

the

uses

$3,750,000,000

this

for

instance,

these

or more.

In that case,

such

neutralization of the
"unfavorable" effect which her
some

prodi¬ voluntary appreciation

money

of her dol¬
lar would otherwise have on her
trade balance and on her
gold and

gally at a rapid rate she can ac¬
celerate a price rise here and pay
high prices and then, when the
money has been used and the time

foreign exchange resources, Can¬
ada might be unable to* maintain
her high price for her dollar. She
would
then
resemble
England

to repay it and she starts
selling an excess of her goods to

comes

us, as she ultimately must, the
combined > effect of our sudden

when,

t f

e r

appreciating

her

traditional parity / in
1925 on the faith that our
loss of the market for our
prices
goods
created by this loan
would
rise
enough
to help her but
coupled with
the increase of
she
was
disappointed
in
her
competition from
hope
her goods shipped here is bound and, in 1931, was forced off gold
to
hurt employment here and again.
pound

How

prices, perhaps

high

where

factors

these

circumstances,

sent seriouk

would

probieitt$.

has

our

off

other

creditors

from

whom

upward

the

benefit
in

Several

modest one.
of wartime

She

price

established

price controls^

ing somewhat to hold down her
prices and to raise ours,
i

credit,

incentive

their

starving populations,
they will do well to
cooperate-^hope that we vj^ill .cq^

and must

operate—with
gram.

•

this

salutary
;

pro-'

•

The Political Aspect

There
this.

The

would

political side

politically

all

easy program

subsidize

gold

and

silver

mining by high prices for
metal, to subsidize exports
Doth directly and
by unsound for¬
eign loans, to shut out competing
foreign goods by ..tariffs and de¬
the

money.,

Canada has ap¬

her money. Thereby she
discourages her exports instead of
subsidizing them.
Thereby she
hurts her mines for gold and hurts

her

prices and employment.
>
/Can a government which ac¬
cepts such political risks! expect

to stay in office?
Fortunately eih*
ployment is.currently heavy and

the

political risk of: deflation is
somewhat less than normal.' But
is an added risk;
Presumably,
Canada has weighed these
risks,
balanced them against world star¬

vation,^/ Unemplo5dheiit^
misery #
despair, weighed them against the
risk

of inflation in
Canada, and
has decided to accept them. In so

doing she has shown courage and
a
quality of leadership such as we
are
beginning to look for frbhi
our northern
neighbor.^
•,

Nevada Goldf ield Mining '
Stock

If prices rise throughout the
world then the benefits of this
action by Canada will be largely
lost. But she will have done what

Publicly Offered

Lionel

A. West, 40
Exchange;
Place, New York, on July 11, of4

fered

250,000 shares of capital
stock (par :10c) of Nevada Gold-*
field Mining Co. at $1 per shared
Of the total shares
offered, 200,00(1

behalf of the company and
on behalf of the un-*
derwriters. Proceeds will be used
are on

25,000 shares

to rehabilitate mining and
milling
for general development

plants,

and for operations.

Company

was

incorporated- in Nevada May 20|
1940. The company's property
wa^
jtf operation at the time the goy-j
ernment closed all
gold mines for
the duration of the war. In

peace-/

the

company's

properties
$1,000,000 gross in
gold-silver bullion, based on pres-*
ent prices, largely from one of
many veins indicated on the prop-'*
produced

over

erty.

The

with

mine

property

equipped

plants, electric power
and mill, with a capacity of 100
tons per day.

?ti$l

99,000 Shares

Corporation

Common Stock
(Far Value $1 Per Share)

compensation

on.

1945,

was

Price $3,00 Per Share

inau¬

provides

incentive

for
j..

payments

Frank C. Moore & Co.

the relation of the total
.

number of employees of the

ex¬

change and

the

its

affiliates

ing in stocks

the exchange

cluding ail - rights

ex¬

as well as war¬

rants selling under

$1,00. ^

Broadway

New York

average reported volume of trad¬

July 16,1946

for

And / finally, time,

has been said, her action puts
in motion automatic forces tend¬
as

the other hand, she is able

to pay

England failed?
favor her.
Her

which follows the interregnum in

pre¬

keep her purchases down and

succeed

can

working
order.
She will 'have the benefit
of any price rise ift this country

Ahct the

to use much of this money

Canada

controls

mildly inflationary effect of the

far

revaluation is

mar¬

their

want to be able to buy food

illustration, the U. S. tourist, it-

goods.
Without some such con¬
siderable rise in prices here rela¬
tive to Canadian prices, without

about to be lent her
by us.

If she

Canada,

States

while he will not get 10% more
Canadian dollars for his money,
will
get
10%
more
Canadian

exports and that that
advantage Is subtracted from her
trade deficit she should come
out

except

between the United

by 10%

of her tra¬

invisible

well
trade

owned

tion of her dollar can be neutral¬
ized provided only that our prices
rise above hers—-faster than hers

by
Assuming that

advantage in the field

property

evils can be removed and the
burden of the relative apprecia*

only 109

some

other

factories, if they

they

for the second quarter of 1946 un¬

tering

partner

idle

devastation, disloca¬ will, also the increased cost of preciated
of tourist
paying income on Canadian, secur- preciated

The New York Curb Exchange
to
employees during the
week of July 10 a bonus of, 9%

quarterly

Johnson.

available forf purchase,

Fox Metal Products

Employees
Curb Exchange

gurated

active

their

Pet.

Harris

en¬

and

goods

to
.they want to sell

&, Co._™

Prior to

Lyons,

simultaneously with
of

cut

DIVISION
Won

Hirsch

civilian negotiator in War Con-

trade

If,

and

initial

purchasing
power
below i what
they otherwise would have been,

somewhat to her troubles.

dollar, by curbing

stimulating her im¬

Canadian market, if they
to employ their idle labor

want

"SHORTS" DIVISION
N. Y. Curb

and

shift in her balance of
The resulting decrease in
employment; and
payrolls / and

recent Canadian action would add
-

Canada

trade.

ket and, when the time comes for
July 25, 29 and Aug. 1, in the
evening at Croke Field, 240th repayment, sell at low prices. The
Street and Broadway, near Van intelligent tapering off of the use
of this borrowed
ihoitey, Uhder
Cortlandt Park'.. Hirsch; '&;• Co.;
captured

But

countries
that

the

tion, and the ; absence

three

tract Terminations.;

also

wartime

harm

other

own' throats

them.
in

can.

their

adverse

by only 125
In view of Brit¬

a disastrous fall.
So that what
Britain fears is that she will have
to buy in an inflated

Exchange plan, which

ish

ports, will tend toward

end¬

Cause some fall in

the "Shorts" Division, in a
three game series to decide the
Wall Street championship.
The

Air Forces and U. S. Engineers

was

months

her

exports

ners in

employed during the quarter par¬
ticipated in the bonus. The Curb

Saunders

four

immediate

she

bonus plan. A total of 353 persons

Mr. Saunders has recently com¬

of Saunders &

the

million pounds,

now

Loeb, Rhoades & Co.,
night (July 15), there¬

ciation

of 253 million pounds

creates

pleted two years with the Army

government

For

spending

paid

the association with them

her

ultimately be beneficial.

As to Canada herself the
action,
as
already noted in our newspa¬
pers, /will be deflationary; Apprei

Fairly recent figures are given
by the "Economist" of May 25,

reasonably

SlreefSoft Ball

Wall

With Benjamin Lewis

nounce

Effect

So that to find
out how much she is hurt we
must
ask ourselves what the
probable
deficit will .be in her balance of
-V

want

"invisible" items enter both sides

payments.

wholly by receipts, then
prices across the Atlantic

will

So-called

one.

largely

and will

of this account.

96 million pounds.

ILL. — Benjamin
Lewis & Co., Field Building, an¬

short of the former

England retains

made Assistant Manager.
In
was elected As¬
sistant Vice-President of the First
National and six months later be¬

J. M. Saunders Now
SSfCHICAGO,

she has borrowed on less favor¬
able terms and balance
purchases

high

she will also get that much more
of what she sells and will be/hurt
only as the latter i excess falls

was

Bark,

while the rest will stay
aboard to spend the morning fish¬
ing for fluke in Great South Bay.
Lunch will be served aboard the
Kismet for the entire party early
in the afternoon and the remain¬

%
'
sellers' market, however,

January, 1944, he

;

Monday

Approximately sixty employees
reporters

his

pointment as
Manager of the Bond Department
two years ago.
He joined the
First National staff. in 1928, and

Carl

including

fore

be-

The F. V. Foster team in the
Wall Street Softball League took
both ends of a doubleheader from

New York Curb Exch.

of the New York Curb

bank

longer be profitable .'. ." (or as
profitable).
If, however, such restrained re¬

ing April 30, 1946 imports of 378
million pounds exceeded
exports

the
Davis

In.

torce^ her "to
for what she

1946.

traveled

that much

341)

page

merely

invCstm ent

pensively i for
joe

will

circles, having

ernment1 securities

and

TENN. — Joe H.
Davis, Manager of the Bond De¬

credit may have been reduced.
It is also the opinion of some
students of Treasury finance that
the interest rate

(Continued from

MEMPHIS,

short-term and long-term interest
rates" which has been "conducive"
to unnecessary expansion of bank

curities

Canada Restores Dollar
Parity

Memphis Firsi Nai l.

position to which it has already
pledged "assurance," except that
^the

377

THE

COMMERCIAL & FINANCIAL

CHRONICLE

?v.

Burying "Inflation
Bugaboo
without doing more
wartime.excessive feasibility
penditures, r:
335)
workers' earnings, low interest
in the rates, and national debt monetizabewil¬ tion. Yet, in a letter to the New
by our discordant Demo¬ York "Times," as reproduced in
Administration, f Certainly, last week's
"Chronicle,"': Mr.

(Continued from page

propaganda to instill fear
minds of a people already
dered

cratic

support
President Truman or Mr, Bowies'
prediction that unless total OPA
were
continued there Would be
is

there

evidence to

chaos."

Bowles was

bold enough

to in¬

directly admit that price controls
merely attacked
the symptoms
and not the causes of inflation.

missive, he speaks as fol¬
lows:
: r
,
"The Times' has often said that
rising prices and rents are the re¬
sult of inflation rather than in¬
flation itself. Your point of view
has been that the mere existence
In this

A More

Tempered Attitude

■'

Notvr

after^the

PteBdOi^^ :veto

Chester
Bowles, the arch propagandist of
bureaucratic price control, has
stepped down, a more tempered
and
scientific attitude is being
of the OPA

bill, and after

No.
longer need we look for the vague
predictions of chaos and disaster,
taken

of the

whole subject.

price controls are: removed, ;as
announced ; by Secretary

were

Henry A.

Wallace- and others,

of;

of increasing

than good —-

taxes.

veterans'• terminal*
leave pay with care. - There is
sertainly no question in my miiid
about the fact that "veterans are
more than entitled to these pay¬
ments. But they are also entitled
io some assurance that vthe pur¬
chasing power of the payments
will not be wiped out by an infla¬
tionary rise in prices."
"7.

Handle

aspect to which
tion" -could be

II 11

ii,

' i'

ihdsxU bf

11»

I I

i'liii

ini

tfomrnoditlels .urv

pricek ^(fegardin^a^

the term Vjnfla-. Whkih}sthere4 has w;been:■? jsoj hihch (i
aK:
applied,, mainly,; controversy / lately)
inconvertible

issue

money.' He probably would
have denied that changes, in the

jcharacbei:^ hut itsomething that? ';
-ori:;:; contlnuhUsly^^Ih vguod^f

price level tlue to goods -scarify
or higher production costs was a
species of inflation.
Yet this as¬
pect of price changes we have
come to erroneously call
"infla¬
tion."; And when prices fall from
whatever cause, we speak of ft-r
usually erroneously — as
defla¬
tion."
Some writers, notably Irv¬

.times/and %
or long-iterm trends and. its short-¬
term fluctuations; Tt is comprised;
and studied in the manyjdstotjes'

paper

have been pro^-i
several cemu-:

prices which

duced in the past
riesa

Prof. Hansen

ing-Fisher,'have

Speaks

The
the

•

concent, to which*
"inflation" should be

second

use.
that you

you

mer

Federal

visor and

Spending"

Reserve

Board

ad¬

advocate of "public

economic

term

because

you

have

far as to

the Challenge of

tion,"

widely

applied

at the through; the excessive jssues of';

ihconyertible paper currency, asv
occurred during/the French Rev-,
hlutian/the;
American Revolutiohv'
foot¬

present time, holds to the idea ol
of the use of the term

sta* restriction

what dictionary bilizer, Professor Alyin H. Hansen
Indian
But the fact remains of Harvard University.
do not necessarily have article, entitled, "CanWeMeet

pneumonia

gone so

great deal upon

entitle it i'Tapsr inayaffectcerta "iy

Money Inflation in France"; so. as
to limit Its contents to the one

excessive

strictly confined, is illustrated by.
invent.. the -; term f "reflation — sudden increases in the supply of;
J Another authoritative- voice for
the ojteciovs rmetals • (as .happened*
whatever that means.
;
•_
a temperate outlook on inflation¬
I Dr. Hardy, in his review of the in Siiain .after thei/di^pvery oLpur¬ ary pressures comes from a for¬ various aspects of the term "infla¬ America)
or,; 'more
generally^ *

tremendous excess of
chasing power over the available
supply of goods is inflation.
I
think the definition may depend
of

harm

careful: to

Was

'W'

378

its proper limits..

note in; his essay he

Inflation?" pub¬

As .a
states:

'•

"The writer would prefer to.' de?
fine 'inflation' as meaning a rise
-

Civil

and

Napoleonic.

the

War,

Wars, and/during and after the:
Fir^t World War. Ml modem tna*^

coterie.
No longer are we oneumococcus
germs
in
your lished in the New York Times"
jor wars. when, financed on a
in prices-which--is.'apparently due
to hear of soaring wage-, body. During the last four years Magazine, of July 7, he writes:
large scale through borrowing; to»
to an .increase in the snpp v o'
price s p i r a 1 s. ■ of inflatipnary; we have certainly had the germs
"The current inflationary pres¬
cover
government deficits* will;;
money.
This -differentiates, infla¬
''booms and bust," of black mar¬
of inflation in the economic body, sures do not come mainly from
result
in- price
increases and', ;
tion from 'rising pMces - by
kets, of. swollen profits and of and in large quantities. Price and the cost side; they come from the
boj- higher living costs, just as certain'
"gouging ttianufacturers," if those rent controls, however, have so side of demand; Nor is inflation excluding '^wliav,Is. - "Called: In t.
diseases are bound- to produce a
text sporadic inflation,-and toe in¬
in authority and those who labor, far succeeded fft staving off the inevitable because of the current
fever -in the body. It may be al--"
creases which are associated««.
who produce, and who distribute, disease;
This does not mean, of money supply.
leviated for a time. but i t^cannot* *
The money sup¬
recovery from depression.
BU
exercise sound and realistic judg¬ course, that .the danger that the
be, altogether avoided. But Us 'to
ply is no longer increasing. The
mentv before staking
action or economy would get the disease Treasury has been reducing its the term 'inflation' is used m pop¬ the effects of 'price controls in -al-»
ular speech so loosely that an
adopting policies contrary to pub*> should not have been further re¬ general fund balance largely by
leviating the /fever, I can merely,
tempt-to tie ourselves to a narrov
lie interest. The natural tendency. moved by removing more of the
repeat what Dr. Hardy has writ-retiring securities held by the^ definition,
woi^d
TeatLto
ineconOmic and social adjust¬ germs.
ten*
commercial banks. We are rapidly
r ;
derstattding, since readers genei
ments is toward stability—a con¬
"In dealing with inflationary, moving into a budgetary: surplus*
i
4s Ao ^0 jemphasized^ that in r
ally interpret^ word' in accord¬
dition of equilibrium which , may
cases
of
physical shortage, price;
pressures of the magnitude, we
"Large continued purchases of ance with their own understand¬
be fostered, but not permanently are facing, a sound policy requires
control is at best a palliative. It;
government securities ate in pros¬ ing of its meaning,
interfered with, by taws, edicts or not only the maintenance of ef¬
regardles^-o dpes nothing to has en, and 'may:
pect by insurance companies, sav¬ an author's explicit statement tha
preconceived administrative pol¬ fective controls over prices and
delafe th& cest^alaoh r. of* normali
ices.History has taught us all wages bu; the effective use of all ings banks and government trust he uses it to mean something ho,
feupply ;.conditiors. f,;Nor • does.' it
funds. These are likely to exceed quite the same.'.'
•
vrr.'.--r-**
this
but mankind, particularly the other powers which can be
hdlp in determining who shall get.
any net liquidation by individuals 4 It is the curse of economic sc1';
law makers and government ad¬
the short supply and who shall go
helpful.
And those powers in¬ or business; and thus we may See
ence that terms are invented one
ministrators*
clude, in particular, fiscal and ?ome further reduction of the se¬
Without';* Unless ^ cpbpled With;; a i
used that are not given a fixed oi
tory.
monetary powers.
plan of rationingy4hIeaves the
curities held by commercial banks.
II
definite meaning.- This -evil ha
"This is especially important in
location to be effected by dealerCommercial loans are not likely
been long recognized by the econ¬
Saner Views
the period immediately ahead of to be
large in view of the high omists themselves, though man> favoritism or the ' formation pf
us.
While
the
fighting
was
still
^ueuespr^
An indication of the recognition
-liquidity of business concerns. In have
not
troubled
toemselve. else those
who have leisure and
that administrative edicts cannot going on our fiscal and monetary general, the control of the money
much about it. Both Thomas Rob
policies
had
to
be
shaped
in
the
patience to chase- advertisements
offset the workng out of economic
supply appears by now to be ert Malthus and John Stuart M l
and investigate rumors fall heir to:
laws
is the recent attitude ex¬ light of the overriding need of pretty well ip hand."
contributed essays deahng with
the priorities which in the
•
pressed by William Green, Presi¬ winning the war. They could not
the difficulties of
Dr. Hardy Gives Scientific
definitions-^ Senice of price control' would ac«r ;
dent of the American Federation be'directed solely to the objective
economics.
But
since
Explanation
Hieir^tiim crue to those who are willing anil;
of Labor. It will be recalled that of economic stabilization.
-u. more
than a century ago^
able to pay the highest prices."
Mr.
Green,
along with Philip
"Now that the fighting is over,
Lastly, as further evidence that
little has been accomplished ir
Murray, head of the CIO, : sup* however, the maintenance of a the inflation complex is being
toe way of clearness andI fixity o
ported price / control to the ut¬ stable economy has become the tempered to a sounder and saner
economic concepts.
most, and predicted; widespread number one domestic problem of degree, there.is. the article of the
variously defined, and the distinc
labor disturbances if such controls the government. Stabilization con¬ economist,
Dr> CharlesBfedrdy,
tlons between "money en4 .cursame prepared under the auspices of
were removed. Yet, only recently* siderations now have the
rencv" is sometimes outlined,
and at a time when Congress was importance that winning the war the Federal Reserve Board, but
more
generally neglected.
Tbr
debating a new measure of con¬ had before. Fiscal and monetary not necessarily representing the
complaint. against economists itrol to take the place of the one policies should be shaped in the opinions of that governmental au¬
that each uses the same terms, bu
vetoed
Halsey, Stuart & Co. Inc. made
by
the President, Mr. light of this fact.
thority.
(See the "Chronicle'* of
gives them different meaiungsand a
Green comes out in his monthly
public: offeting, July 17, of
July
11.
p.
189.)
Dr.
Hardy,
who
"This is true regardless of what
these meanings are not difieien087,000 Albany arid Busquehanna :
publication,
urlg i n g American decision the Congress makes on s Vice-President of the Federal tiated in their texts It
ls.£ot,s"L RR. first mortgage bonds, due by 1
workers to increase the volume of extension
of the price control Reserve Bank of Kansas City, has
prising,, therefore, that^the^^
extension April l, 1971, interest at
their production "as the only laws. The best of laws will need demonstrated his -capacity as a
"inflation" has been so badly mo¬
means of wiping out scarcities and
to be strengthened and supported careful and painstaking investi¬ used—so much So, that as sug¬ ^8/4%; at 10Q lk %.. These bonds arc
eliminating ^ the ^danger of run¬
guaranteed as to principal and in¬
by sound fiscal and monetary ac¬ gator in his studies relating to the gested by Dr. Walter Spahr, Mr
terest by Delaware; & Hudson Co*:
away inflation/' and adding fur¬ tions.
If the Congress fails to effects of interest rates on stock Frank
Rathje
and
Since 1870 the properties of the
°^er^AT-1.
ther that "our safety lies in get¬
give the American people the pro¬ prices, the effects of tax exemp¬ should be dropped from the econ
Albany and. Susquehanna have,
ting through this period of transi-1 tection of effective price and rent tions on securities and effects of
omists' vocabulary altogetoer.. If
been operated as an integral part
tion with no major increases in1
wartime price controls. His anal¬

his

likely

•

;

Bl .'I'

Hahey Stuart & Co.

Offering Bends of
ASbany & Sasqaehasoa

costs

stoppages t)f

producton."

He urges labor not to make ex¬
cessive demands on Congress but
to

cooperate with

controls, such actions, plus selfrestraint, will have to be our sole
reliance.

management to

production and efficiency
concludes
t h a t although

increase
and

"prices and living costs will rise
substantially for a few months, an
all-out effort to increase produc¬

productivity can flood
with goods, bring

tion

and

the

market

prices back to normal, and
the

income

pay

create

wage

in¬

creases."
;
:

Mr. Bowies'

Tempered Tone

Another apparent

change from

and inflexible to a
more
tempered attitude toward
the effectiveness of bureaucratic
a

vociferous

price controls has come from the
pen of the arch supporter and
propagandist, Chester Bowles. Let
it
be
remembered, it was Mr.
along
with Secretary
Wallace, who was largely instru¬
mental in creating the inflation
Bowles,

psychology among the American
people. §;;■ They harped upon the
rapacity of producers and the
of commodities as the
basis of inflation, but ignored or
belittled the fundamental cause,
scarcity

creation of currency
through swollen goverrimfcviv ex¬

namely, the

"Regardless of the action of the
Congress we

ought as a minimum

to:

"1. Make

all-out effort to

expenditures by the Fed¬
This should be
done in order ont only to balance
the Federal budget but to estab-*
ish a budgetary surplus as soon as
possible.
"2. Urge State and local govern¬
ments to postpone their expendi¬
tures on public works as far as
they reasonably can.
"3. Use ail means ftt the dis¬
posal of the banking authorities
to prevent commercial banks from
increasing their loans to business
for the purpose of increasing in¬

prune

eral

Government.

ysis of inflation, though

care

not thor¬

oughgoing
in
all details, has
brought out clearly the complex
character of this economic phe¬
nomenon.
Inflation, like the com¬
mon term "disease," has a variety
of causes and aspects, and these
causes and aspects are not neces¬
sarily connected or related to one
another.
Each arises in a differ¬

each,.a different
remedy should be applied.

ent way and to

had

decade in

there would be les
confusion about it now notonl;
on
the part of political admirns
trators end legislators, but
part of the general pubUc^Tfte^

of the term,

would he less

The term "inflation" as

ing to changes in price

■}

apply¬

levels or

of the Delaware and

miscomprehension

to proper stepr
economic-stability ant

part of all as

promote

progress.

Inflation Is Heavlly Redundant
Meney'Supply

Corp., and the latter^■ .aSsumed thifr
former's obligations.
The bankers underwrote an of¬
fer of extension .by The Delaware

Hudson

holders

Railroad Com. h*
•

the, $10,000,000

The Albany and Susquehanna

RR/

first mortgage bonds due April 1,
1946.
All interest on the latter

;
boncesv has been.. ..regularly , paidl •:
i.
; /
$10,000,000 of old bonds,
outstanding. $5,047,00(9
were extended by the; bondholders.
The hankers purchased and
extended $4,887,000,f of whi ch $4.~
087,000 are being publicly offered*

when due.
Of the
.

discussion of
,
a
"leaf distinction' should be
made,
as
pointed out t>y.. Hr.
Hardy, between - the concept of,.
(1) a condition where the pur¬
chasing power of the ^dnetary
declines (or vises, ;hs in the
flo-caUed "deflation") because of
I change, in the ratio of money
<5nnnlv
to
goodsv«, and Sfrvjces
In any

purchasing power of the mone¬
tary unit was practically unheard
of in economic literature a cen-i
tury ago. Yet, its nature and its
ventories unduly or speculating in causes were well understood. The
quantity theory of money was de-,
capital values.
veloped from this knowledge. Da¬
"4. Give the Federal Reserve vid Ricardo, more than a century
oystem such additional powers as
wrote learnedly of paper
to enable it to exercise effective ago,
inflation—but he never; avaUable tor
control over the supply of bank money
enndition where tne mon y
p
used the term "inflation" in his
credit.
He called it "currency nlv becomes excessively redund¬
"5. Greatly stiffen the taxation writings.
ant or depreciated because of.govof short-term capital gains in or¬ depreciation." When the late An¬
ernment
der to curb speculation and prof¬ drew D. White published in 1876
in its future stabi
y
iteering.
' his pamphlet on the history of the confidence
and purchasing power.
The urst
"6. Avoid any reduction in in¬ French assignats ; as a document
to
combat the wave of "green- concept merely results in ^hang¬
come taxes ac tnis time and care¬
ing or fluctuating price level. It
fully examine the need and the backism" in the United States, -he
e

The Albany ^

arid Susquehanna was merged Into
The Delaware and Hudson RIL

hfthe^terms^^upply^and .^de^ afld
and a better attitude or
the

Hudson Sys-

teriii pri tTuly ,2,1945,

mand "

Ill

Misconceptions of Inflation

been used m the las
the proper aPniicatior

Which

Thetmmaitiing

pl^horids^amount-'

ing to $66,000, are being paid by
The Delaware and Hudson Rail—'
road. Cdrp.: ^ipbm|>Tesentatidi^
-.The- extended

exchangepr«^X|)^, tinue

bankruptcy^r, loss of

were

■:

bqnds w^^

to be secured

by the lien of

theififst mortgage hmall "propec^;'
ties

owned

by Albany and Sua- •-

quehanna immediately prior to its

into The Delaware - und

merger

<Volume 164

Number 4508

THE COMMERCIAL & FINANCIAL CHRONICLE

OPA Removal and Stock Prices
*

page 33§)
'
months,; but that

been

reflection

That Is just what the market
proceeded to do in no- uncertain
fashion in the second half of last

(Continued from

tiext

•

several

would

•

higher eosts already grafted into
the economy by recenc wage increases;
only we- get production

year, but

4-there is-no need to worry aboiit u
-:

-spanof

Reasons

Recent Price

American Cyanamid
Dow/Chemical

the upward price ad~

arev

struction

166%

nounced

112%

ment

-—---w

67y8
Wi

-4-i.j*'

42-3%
42

«...

563/4

than

■

that

most

European
economies

na-

regulations. The point is. that if
tions, where the
- are
a further long step toward a free
/ largely dependent upon -importa? economy is to, result from CPA
4km of raw tnaterials;
:
'
;i ij scusslon, the market will;forth^
One of the effects of - war -is with resume its advance toward
•

•

Caterpillar Tractor
Joy Mfg.

•

greatly to stimulate effort in all
sorts of directions; it is typical for
production, prices, wages, income
payments

-and

3% basis.

longer young- that stocks are
no longer on the bargain counter,
that historically prices are on the
high rather than oh the low side
and that from point of time we

•

are

much nearer .the presumable

end than the beginning of an in¬
termediate swing. Thus assump¬

lowed

whole

decade

de¬

business.'Conditions and
activity with all the demands and

Non-Ferrous Metals-■
«.

Kennecott

Copper
Jersey Zinc_-

was

Mining

laude)4 in

1915/ and

acquired for plant expan¬
sion in the fiscal year ending Au¬

were

of SJD. in 1917.
He
at Harvard Law School

gust 31, 1946. The bank loans
*

incurred

were

March 4, 1946, matur-

inging in five equal instalments,
$2,000,000 each on March 4 in

1917 Mr.

McLain

en¬

War Loan

member of the

Staff, of the U, S. Treasury De¬

Oils

each of the years
(1948

elusive.

to 1952, "in-/

4 /.//
until this' month:
known as Spicer Manufacturing
Corp., was organized under Vir¬
ginia laws on October,: 12, 1916/
succeeding a New Jersey corpo¬

.Dana

■

Corp.,

ration whose

business started

1904. Its principal office is located;

partment froimMay 1919 to Sepjji; Toledo, Ohio, The company is
74% ' tember 1920, and Assistant Profes42% sor Harvard Law School from both an operating ahd a holding
28 y4
1920 to 1923.
company, and with its subsidiaries;

Gulf Oil
Lion Oil-i-i.
Ohio Oil—

pressed

tion of large scale risks at this
Standard Oil of Calif._
stage of the market is not justi¬ Standard Oil
(N. J.)
.Wants thfereiit^ accuMulat^^One; fied and would not be justified
Miscellaneous
should therefore not assume that1 even if, because of OPA and other
•
rising prices, wages and consump- news, the market should break Bendix Aviation
Food Machinery
Icon per se are evidences of ram- out oh Volume on the
upside,
Francisco Sugar
/.pant /inflation; despite. thb^ put*/
v With
favorable hews :oht; of
Meyercord Company.
licity likely to be given inflation
Washington we could get a rise in
as election day approaches.
Pittsburgh Cons. Coalthe
market
that
would
last
■

Corp. 4 (formerly
Spicer Manufacturing/Corp.) was made;

listed in the Fourteenth Railway
Engineers and served in the A.E.F;
in France and Italy from July
1917 to April 1919, having been
Commissioned ,a Second Lieuten-;
ant of Infantry in June 1918. He

•

(cum

In June

Sunshine

A., McLain

Dana

to 1917.

American Metal
New

Chester

was Thayer
Teaching Fellow there from 1916

Wilson

Development, an¬
July 12 the appoint¬

from 1915 to 1916 and

Swift

Investors should keep in mind,
however, that this bull market Is

and
on

lectured

Meat Packing
Armour

Recon¬

the degree

32%

Cudahy

Investment Policy

consumption to
im3d at a higher postwar than
; prewar plateau and- this is espe-;
:
cially likely to be true of the
I period following the recent war,
not only because far greater po^»tmtial demands for goods were
created than during World War I,
.but because the ' recent war ' loir

LLB.

■?; 79 ;i

Sundstrand Mach. Tool 32%~33%

for

General Counsel of the Bank. Mr- July 17 by an underwriting syn-!
McLain was graduated from the dicate headed by Merrill Lynch,
Melrose, Mass. high school in 190P Pierce, Fanner & Beane. The stock
and from Harvard College in 1913; was priced at $102 per share.
with the degree of AB. <magna
Proceeds from the sale will be
cum
laude).
He received from
used by the company to prepay
Harvard Law School the degree oi
$10,000,000 of bank loans which

Beatrice-Foods.^

Bank

Lynch/ Pierce
Stock

A
public offering of
100,000
shares of $100 par 3%% Series A
cumulative
preferred
stock
of

Eugene Meyer, President of the
International

218%

Foods

Best Foods

Offers Dana Corp.

lacking for current back to a peacetime basis, thatthe
A. E. Staley Mfg. Co./" concern over the posi ion^of the
etonomy might stay on a partial
National Dairy
dollar as a currency, and the pro* Wartime basis of
part slave and
Machinery
ducing capacity of this country part free with a continuation of
puts it in a far different-position many Government controls and Allis-Chalmers
•

For WorM Bank

183 y2

Monsanto
Union Carbide

Merrill

/ 1/4

DuPont '■£

justment -was halted - early-^this
year when it became increasingly
'evident that we might not go

^^ttoaway :;inflation^-id S least^f

Chemicals

ceiling of'

approximate
peacetime markets.

the

-of

the

McLain Gm'I Counsel

55%

78y4

member of the New York firm of

primarily produces parts for, the;
automotive industry. It is one of

Cravath, Swaine & Moore and its

the largest manufacturers Of uni¬

Since July 1926 he has been a

•

29%

Labor Difficulties

There

the

possibility

that,

with the higher commodity prices
:

likely to fee registered in:
coming

over
«

labor

would

months,

any

organized

such

make

cash

exorbi¬

tant wage demands as to recreate
the chaotic conditions obtaining
in the second quarter of this year.

/This could, of course, occur, but
-

:
.

the

imminence of

labor to
the

fall

public sympathy in

seem

than

intesifying, the resentmentagainstorganized labor
that flared so suddenly only a few
months ago. f;

prices which would not be large
in

comparison with the approxi¬
advance following VJ

mate 33%

Day

the

1942 lows.
If

here

' ',v.,Vv

•

prices
will

move

the

see

sense

and individual issues

participating than

we have thus
In the first half of

far this year.

The nation, the whole world in
fact isiri process / of/ironing out,

evitable distortion of relationships

always

often

than

bystanders as well
This
jockeying

not

25%
22

Steel

20%-%

Traer_

West Indies

50%,

such groups

<&emj^/\gi^ery/ llquoiv motion
textile

moved

groups

such

and

steel

stocks

by about 20%, while
as
automobiles, air
transport, banks, foods and bever¬

affects

participants.
for
position

among
nations, groups, classes
artd companies makes for an ap¬

great variations.
With return to

free economy

the market

may

be expected

move

unit and

groups

that

have

been

those

laggards

pearanceofturmoil, unsettlement since : last summer should meet
and uncertainty that can at times with: increasing investment de-4
Those typical "tail-end/
be very trying for businessmen mand.
and investors. In retrospect these ers,"
steels, coppers and rails,
be
prominent
in
any
periods will seem like no more should
'V than important ripples, but while strength and stocks in the laborthey are going on they assume the vulnerable manufacturing groups
importance of all current events. that have had sor much difficulty
Ttoe economy may be confidently getting into production, such as
Expected to survive without major autos, farm implement, railroad
and electrical equipment and ma¬
impairment this postwa
J ment even though soine fairly chinery shares Should do well.
Among commodity shares sugars
wide swings in stock prices and
and coal stocks should be in bet¬
'

•

business activity may occur prior

ter

was

an.

important factor

Oil,

office of the firm from December

transmission

1926 to November 1928 and from

forgings.

will assume

his

August 1.

; *

The uncertainties of war place
low ceiling on

the

war

was

markets.

While

it appeared rea¬

average

value

this

Gas & Electric Bonds

This advertisement is
M

Halsey, Stuart & do. Inc. headed

May 31,J
1946, amounted to approximately

$45,000,000,

1976 of Portland Gas & Coke
at

101.46%
bonds

bankers

and accrued
were

July

with

Of'an offer to buy,

circumstances to be

as an

any of *uch securities.

Net proceeds from the sale fo
the bonds will be used to redeem
and retire

$5,751,000 first and re-i
funding mortgage 5% gold bonds,
due 1940, extended to 1950, and

250,000 Shares
■»'

■

/•••.

'44^-/;

NEVADA GOLDFIELD

MINING COMPANY
(A Nevada Corporation)

$2,625,000

first lien and general
mortgage gold bonds, series 4%s\
due 1940, extended to
1950, at
100% and accrued interest in both
be

redeemed

$371,000 of Portland Gas Co.

callable first mortgage 5 %

are

non-

Common Stock

gold,

bonds, due 1951, at 100% and ac¬
to -maturity.5 The,
remainder of the
proceeds, to-.
gether with the proceeds of $500,^)

(Par value 10^

crued interest

4^'"'/''.
.

//v,'!/'4

per
'Wfi/f'1!

share)
•

?VL7

'/4

.'4.' ''

000

principal amount of : serial •
notes, will be used to provide ad-1
ditional production, transmission,
and distribution, facilities.
.

Portland Gas &

Coke

Co.

PRICE $1.00 PER SHARE

and«

its predecessors have been in the
business of supplying tnanufac^
tured gas for over

stock prices would probably not

Deere.;

■

International Harvester
above an approximate 4 %
Minneapolis-Moline
yield; basis and that proved . to .be Oliver
Corporation.^.
Once the war ended it

yield basis, which for -years had

Price
51

543/4

amove

Building "
appeared likely that the market Central
Foundry
would move up to. around •. a 3 %.
Mitm.-Honeywell

territory
and

years.

The

include processing of
agricultural products,

forest products, paper, aluminum
reduction and shipping. The pop¬
ulation of the

area

served is

mated to be in excess

esti¬

Halpern Opens

NEWARK, N. J.—Ed. M. Hal16y4

Reg...

Pittsburgh Plate Glass.

LIONEL A. WEST

ofx600,000.

173/s

pern

the

bid

demption
prices
commence
at
101.47% scaled down to par in the
last year.
^

Co.,

Also

The offering

is lhude onlyby the Prospectiis,

The bonds are redeemable in
whole fer part at prices tangingfrom 104.46% to par. Special re¬

cases.

construed 'as,.

offer to buy, or

interest.

awarded

not, and, is under

Offering of these feturities for %s'ale,

solicitation

group that made a public offer¬
ing July 12 of $10,000,000 first
mortgage bonds, 3%% series due
a

fruit

Agriculturaal Machinery
Case'

case.

are

fecent

sonable to believe that industrial

the

time

listed below:

drop

and its Subsidiaries as Of

•

and

Unfilled orders of the company;

Mr. Mc¬
duties

devices

and

building

the

production of axles,, frames, gears,

territory now served by the com¬
to emergence of a period of full chemical, shares are still among pany consists of 440 square miles
of area supplied
the
through 2,343,
blown fiostoar World prospertty;M
: holdings.
Groups and individual miles of mains serving 8.1 com-1
munities.
issues
believed to offer aboveBasic^ industries^In'.''the.®,
War vs. Peace Markets
demand.

shafts
in

Offering Portland

100.2839.

than

partner in charge of the European

Lain

38%

Halsey, Stuart & Go.

7%, whereas in the same inter¬
drug shocks moved up by

and

July 1931 to May 1933.

1914

Sugar

versal joints and propeller

sociate from 1923 to 1926.

Geneal Counsel of the Bank about

The

created
by war, : War
brings in its wake big changes—
phd political^ ages were, virtually stationery or
showed losses; The reason was, of
I >and it. is whdlly natural for a
period after actual warfare ter- course, that actual earnings re
:
inlnates for various groups to en¬ suits as well as earnings pros
pects of various groups showed
gage in a struggle for
position
more

Truax

the year the Dow-Jones Indui*
trial
averages
advanced
about

that

Thomas

,up: from

probbaly

market

more groups

since

advance

4///';•■*

stock

broader

130%

Square D

val

the rise through the
balance of the year, but even so
the further advance is not likely
to exceed 12% to 15% of current
carry

Backwash of \Var
-

could

elec-

likely to make
labor strategy of placating,

rather
:

woo

interim

for

the

andthe natural desire

tions

through the summer, and further
impetus from the fall elections

predecessors, having served as as¬

is engaging in the securities

business from offices at 760 Broad

40%

Street.

Exchange Place

New York 5,

New York

a
tK

THE COMMERCIAL & FINANCIAL CHRONICLE

380

Thursday, July -18,1946

cash for its IOU's from unprecedented problems created by rate should be a minimum of 20%
the present Federal debt
upoit■.all.1^
v1■■■■■■■
We must proceed lb correct at
2. By eliminating the converti¬
(5b) Since we are dealing with
once
the highly inflationary/po¬ human beings—human behavior¬
bility of the currency into gold
a privilege suspended back in the
tentialities which arise from the ism must be considered-~and thej
spring of 1933—the government high percentage of these loans that incentive to venture, to produce
would operate on "fiat money," are now carried by the commercia
and tp earn, and. thus to create •
(Continued from page 337)
prevent ihe flight of capital from banks. These create idle capita new jobs is seriously threatened;:
fusion? The answer is leadership;
White House not only under tragic
the dollar, and destroy the only in deposit accounts which, at pres¬ by a confiscatory system of taxa¬
the wrong kind of leadership. For
circumstances but also under great
real gauge for measuring the de¬ ent levels, are highly dangerous tion. I urge a more moderate scale j
12 years our American leadership
handicaps. He fell heir to the misof rates starting at 20 % and ris-.
preciation of money and the in¬ and explosive.
has tampered with our constitu¬
takes of his predecessor as well as
crease in inflation.
1
Many businessmen and bankers ing to 4.5% at the $50,000 bracket. t
tional republic. Executive orders
to: a series of policies, which no
Confronted with this unprece¬ would sleep easier nights if our —54% at the $200,000 bracket and j
were issued by the score affect¬
dented proposal for "easy" money, debt "problem," for example, were 70 % maximum at the $1,000,000-ri
longer had the glamorous appeal
ing management, labor and agri¬
they once had possessed When
is it any wonder that the business properly se.tled for the next 75 and-above bracket.
culture—orders which had the full
Mr. Truman sent to' Congress a
community should now feel fresh or 100 years. As one means to
(5c) Corporate dividends shoulcl
force and effect of law—that were
"must" legislative program of 21
uncertainties? While struggling to this end, I have advocated the not be subject to double taxation.
neither sanctioned by the people
issuance
of
a
new
class
of
points, Congress was little inter¬
govern¬
get back to some sound economic
(5d) Capital gains and losses
nor
passed by the constitutional
ested in these new blueprints with
base after the strain of war on the ment securities somewhat akin to should be continued as at present.
lawmaking body of the govern¬
their face lifted.
nation's industrial and; financial British "consols." Such long-term
(5e) Earned income should be;
In the midst of all this, however, ment^ -This ' has served to bring resources,
is
America
to
be bonds would tend to free the capi¬ treated much more generously
about confusion and doubt in the
there was one constructive devel¬
tal
markets
of
than
is presently the case.
present
huge
excess
plunged once more into a new era
minds of many people, not only .as
opment. Early this year the Presi¬
of ;
economic
experimentalism? funds, besides permanently fund¬
(5f) Corporation taxes should
to the ability but even as to the
dent announced his intention of
From the past 14 years of unbal¬ ing large amounts of the Federal never be
progressive, and the dou¬
desirability of the Congress of the
pressing for the immediate bal-r United States. It has brought con¬ anced budgets and attempts at government's V huge outstanding ble tax on inter-company divi¬
ancing of the federal budget. This
deficit financing, hasn't any lesson short-term obligations.
dends should be eliminated.
fusion into the one principle that
was to be accomplished^-not
by
I particularly want to stress the
been learned? Is there no stopping
(5gl The Treasury should allow
has always beep the foundation
sharply pruning swollen wartime
point for. price or monetary ^"in¬ fact that today this problem of
latitude to 2 the corpo-?^
stone of our > system, which .was
expenditures, or -:■? through k"anyflation" once it has gaiiied a loot-' sound• ah2l equitable; taxation ijs ration" id; figuring depreciation of:
contemplated as a government of
not
special consideration of the taxsomething abstract, or remote plant and equipment.
hold in the economic habits of the
I say this
laws rather than of men.
The
from the average citizen.; Here, because taxes always seem to go
payers—but simply because, as the
American people?
—President declared, ^federal rev- philosophy of class hatred, when
more than any other sector of the
up.
Therefore the government
It is against this background of
we need understanding, the beat¬
enues were greater than had been
home front, we need a high degree cannot lose on a
fiscal developments over the past
policy of hasting down of that creative urge in
of
citizen
anticipated."
vigilance.
In
this
day
ening the day when the corpora¬
decade or more that I wish to
men,' all this has added tremens
of pressure group activity, the ex¬ tion- will have« nrnwalue on their
; Thus, the waste of public monies
our
discussion
today.
I
dously to the great American ill- focus
went on while President Truman
tent to which we are willing to books to depreciate as- a deduction
want to emphasize two points in
ness~"confusiorr."
continued to rely on doubtful eco¬
from
income.
Furthermore, re¬
particular. Because, on the de- mobilize in defense of the integrity
Today
the
federal
debt
stands
at
nomic : and monetary theories to
of the dollar may determine the search expenditures should -'ye-'
cisions we make, and on the road
approximately
$275
billion.
There
entire future of the nation.
We ceiye the most sympathetic treat¬
provide a painless transition from
we choose, will depend whether
war
to peace;
Completely mis¬ is no positive assurance that the the nation is to maintain its fi¬ are at one of those decisive cross¬ ment from the Treasury because
total will not go still higher. Ecojudging postwar economic trends,
roads where a left turn or a right of the great contribution made to >
nomic
developments
over
the nancial solvency or slip once more
the Administration has initiated
turn will influence national fiscal the economy from year to year
by
next few years will determine into treacherous financial quick¬
policies which accelerate inflation¬
policy for generations to come. research.
r%ri'
whether
the debt goes up
or sands.
Those who would continue our
ary forces.
To ward off ah ex¬
(5h) The Federal government
down. Our policies of debt man¬
The choice before us is just that
pected sharp reduction in postwar
monetary
experimentalism
are only has five sources of revenue
employment, the Administration agement will determine whether a simple. We can stop, while there numerous and persuasive.
For open to it.
These are customs
brake can be applied to the pres¬ is yet time, dangerous spending
embarked upon the dubious ex¬
those not versed in the intricacies taxes, estate and
gift taxes, per¬
ent inflationary forces.
With re¬ which, in turn, will ease the mount¬
of public finance, the pictures they sonal taxes, corporation income
periment of stimulating wage in¬
creases while, at the
same time, gard to debt and policies of tax¬ ing pressures on dwindling sup¬ paint are very alluring indeed.
taxes and the excise taxes.
It is
holding down prices and industry ation, many fallacious ideas are plies of goods and price levels that
What program do we who are my belief that the estate and gift
already being advanced. There is no longer are an economic func¬ more conservative
by nature have tax division should be returned to
profits.
the argument that the debt total tion of balancing supply and de¬
Thus goods became even scarcer
to offer against these bright, glow¬ the States. A very important va¬
doesn't matter since "we owe it to mand.
| while the so-called "inflationary
ing promises for tomorrroW? We riable in this group of taxes is
ourselves."
There is the view,
To escape from the financial must make our stand—-sb it seems ;he excise tax. These taxes which
gap" grew wider and wider. With¬
that under our new "managed
out any mandate from the people
morass in which we are soon likely to me—on practical common sense
are
nothing more nor less than
economy"
setup
"debt"
a n d
on so
to find ourselves, a realistic end —on protecting the seed corn from sales taxes should
.controversial,jm issue, the
vary in accord¬
; Administration
launched■ atat? "taxes'KhaveacQuifdd:<Iuit6 differ¬ courageous'Secretary of the
this year's crop so that next year ance with, the revenue needs of
ent economic functions which are
reaching program to bring about
ury must take
three important we may expect still another har¬ the country at a given moment.
difficult to understand.
a
"managed" national economy,
and basic stepSi
First and fore¬ vest I therefore urge that busi¬ They have become a very vital
The essence of this new eco¬
Through the unlimited expend¬
most, the taxpayers of the nation ness and professional men every¬ source of revenue to the Federal
nomic theory is that since govern¬
iture of government money, a new
are entitled to a far more "sympa¬ where interest themselves in this
government, and in my opinion *
ments now
control the central
thetic" administration of the In¬ ever-present problem of taxation. should be widely extended. While
postwar Utopia was to be created.
This was justified by the slogan banks (in our case, the Federal ternal Revenue Bureau than they
There is a very simple way to I am not a great believer in in¬
Reserve
Board) they need no
heard so often these days: "If we
have had in recent years. We must begin.
That is to get hold of a centive taxation as such, I think
achieved such unprecedented goals longer "borrow"—in the accepted end the prevailing practice of re¬ copy of a very important report I know the human animal well
sense
of that word—but merely
of production during the war, why
garding all citizens—particularly recently issued by the Committee enough to state with some convic- 2
"draw" on the central £bank for
shouldn't peacetime objectives be
those in the higher income brackets on Postwar Tax Policy called "A tion that you niay xiot be 'able ■
whatever sums they need. Taxa«*
—as though they were tax evad¬ Tax Program for a Solverft Amer¬ to force him to work
just as easy to achieve?"
by creating •
tion, as a means of raising rev¬
ica."
Note the emphasis on the incentives* but you can
ers or crooks.
Today, to a degree, that is now
certainly"!
enue, would be obsolete for the
highly dangerous, the American same reason.
Against the gauntlet of examin¬ phrase "solvent America," a con¬ put a heavy damper upon his en¬
Stripped of their
dition
that
is
now
highly
pre¬
people have been taught to "lean" economic
ergies by taking from him the '
j argon, these proposals ers, special agents, "review" auth¬
carious.
on the government. Local respon¬
fruits of his labor.
merely mean a financial "sleight- orities, and the like, who today
As Undersecretary of the Treas¬
It is my humble conviction that
sibility and local problems disap¬ of-hand" kind of bookkeeping, administer complicated and ob¬
pear
by the simple device of which all countries resort to when scure tax statutes, it is increas¬ ury, in charge of taxation and the such a far-reaching program of
Internal Revenue Bureau, I sucr taxation would have a most bene- 1
transferring them to Washington.
ihflation enters its final and most ingly difficult for the taxpayerceeded a very distinguished lawyer ficial effect upon our capitalistic
Having deposited these local prob¬ vicious
stage. Strangely enough, whether of high or low degreeand teacher, Roswell Magill, the economy. ' "
lems on the doorstep of the White
,
<
>'/
'
two leading economists—advisers to obtain simple and expeditious
Chairman of the Committee on
House or the Capitol, they now be¬
of the Federal Reserve Banks at justice.
Postwar Tax Policy.
I believe
come
magnified into "national" New York and
He is caught in a maze of bu¬
Chicago—advocate
firmly in the principles advocated
problems.
The result has been this kind of fiscal manipulation. reaucratic red
tape from which
the growth of an unprecedented
by him.
In a ^recent address before the the only escape seems to be to
I outline the following program
federal
bureaucracy
that
now
American Bar Association, Beards- pay whatever sum is demanded—
as a specific formula for a con¬
totals nearly 3,000,000 persons.
a systematic and tyrannical form
ley
Ruml,
Chairman
of
the
DETROIT, MlCH.-~Hornblower
structive postwar program;
Dr. Allan V. Heely, headmaster
board of the New York Federal of blackmail.
& Weeks reports that Colonel Al¬
(1) I believe wholeheartedly and
of Lawrenceville, said in a speech:
Reserve
Bank, explained these
Second, we must return to ele¬ unreservedly in the American cap¬ vin R. Baker will return to the
"No school or college can give
mental common sense policies of italistic system. That system can¬ firm's employ in their Detroit Of¬
proposed changes in policy:
its students what it does not have.
"The necessity for a government taxation..
Penobscot Building, after
not function successfully without fice,
If there is no institutional or cor¬ to tax in order to maintain both
This
means
abandonment
of a high volume of production and five years of active duty in the
porate morality; if what art insti¬ its independence, and its solvency
Army.
punitive attacks on business and employment.
tution stands for is merely the sum is true for state and local
Colonel Baker was with Horngovern¬ fresh
emphasis on restoring those
(2) Without the hope of profit, blower &
of the individual opinions of its
Weeks from 1928 until
ments, but it is not true for a na¬ incentives which stimulate and re¬
the necessary flow of Capital funds
faculty; then it ought not to sur¬ tional government.
1940 when, as a Major in the
lease the creative energies of men. into old or new enterprise simply
prise anyone if undergraduates
"Two changes of the greatest
Cavalry Reserve, he was called to
Without oats, the horse won't will not occur.
emerge
from their formal aca¬
active duty as instructor of the
consequence have occurred in the
(3) There can never be any hope
work; and without some recogni¬
demic training confused, uncer¬
last 25 years which have substan¬
in Detroit.
of profit or any confidence in our Organized Reserves
tain/without compass or rudder." tially altered the position of the tion of managerial brains and
ability and their importance to the business future without fiscal and After a tour of duty on the staff
This
same
statement
seems national slate with
respect to the national
economy, we can never, monetary stability in government. of the Second Army, he was pro¬
apropos at the moment in our na¬ financing of its current require¬
as a nation, pull the heavy load
(4) Therev will be no hope of moted to Colonel of the General
tion.
We might paraphrase by ments,
to which we are now committed. keeping for one's self any sub¬
saying the United States of Amer¬
Staff, and assigned to the "Am¬
"The first of these changes is
This means a courageous deter¬ stantial part of that profit unless
ica has lost its "institutional mor¬
the gaining of vast new experience
Eighth"
Army under
mination to reduce
the present we revise drastically our present- phibious
ality^ and substituted the "sum of in the
management of central overburdensome income tax on all
General'
Robert
Eichelberger,
day thinking on taxation.
individual opinions." As a result,
banks.
- classes—the high brackets and the
if there is any, one word which
(5a) Since our budget must be which saw action in New Guinea,
"The second change is the elim¬ low—without special political fa¬
could describe the United States
yery much higher than any we the Philippines, and participated
of
America
today* that word ination, for domestic purposes, of voritism for the more numerous
knew in peacetime (perhaps $20 in 53 amphibious operations. Durthe convertibility of the currency low-income
For
while
in
groups.
would be "confusion."
We seem
into gold."
billion
to $35 billion) and since ing the later days of the war, he
normal
times,
"ability
to
pay"
may
to be without a rudder for our
Stripped- of their professional be a sound yardstick for fax rates, we must get a substantial part was Chief of the Eighth Army
present, without a compass for our
would get

the Federal Reserve System.

Layman's Approach to Ou

Post-Wat Tax Problems

•

Alvin Baker Rejoins

Hornblower & Weeks

confused and verbiage, this simply means two the policy can, when carried to of this revenue from income taxes Planning Committee, for which he
*
extremes, have a reverse action
fundamental things:
(corporation and individual) the received the Legion of Merit. Col1.
The
federal
government on the economy disastrous in the
governed our
onel Baker also wears the Bronze

future, and we are
uncertain about the

principles
past.
What is

which

would

longer

"borrow"

from

extreme.

/
the cause of this con¬ coprrpercial :banks; ;but; in futureiV v^hirdi we must face frankly, fhe

I initial

basic rate upon all tax-

^ayers^must be;high. ^I think this Star und the Air .Medafct'J^v/.-V.

■

iVp!tHires164? Number-4508

THE COMMERCIAL & FINANCIAL CHRONICLE

*38%
vp

of means of livelihood.

Our Loan to

Ethiopia

(Continued from page -338)
The soil is extremely rich
through¬
country. With wide varia¬

out the

tions in temperatures and
rainfall,
due to varying

altitudes, Ethiopia

raises

■

since the farmer could not

use

the

proceeds^ to buy cotton goods because of the very limited supply
of textiles.

much

larger variety of
4.
Edible and Essential Oilsagricultural products than might
Exports of these products are al«*
be expected from a
territory lying ready
increasing but are limited
so near the
Equator. The plateau
by the lack of oil expelling ma¬
region is intensively cultivated
chinery. Local plants now have
and produces far more than can
on order in the United States sev¬
be consumed
locally. The prob¬ eral
oil-expeiling machines and
lem is transporting the
surplus to there is a • demand for a great
outside markets.
many more.
These expellers are
puring the past three years ex¬ at present obtainable only in the
ports have been limited by the United States and purchases have
lack of transport facilities and not
been limited
by the country's ability to pro¬ States dollars.
'
\
•

duce

products.

find

The

market

railroad

for

has

its

been

unable to carry half of the

cargo

available at Addis Ababa. A
large

portion

products

for

export,
even
thosb shipments coming from
the south, have had to be moved
by trucks to Assab or Massawa.
Last

July the

local

Commerce made
Ababa and

Chamber of

survey

estimated

were

12,000 tons of goods ready for
shipment which the railroad
would not be able to

transportation

when

Ethiopia

able

again

import new trucks and
stock for the railroad.
During

the

concentrated
to

rolling

few

years

grown

only

on a small scale
local household needs.

supply

has

been

found

that

Texas Highland cotton
grows ex¬
ceedingly well in many sections
of the country.
It is the

hope of

the

Government that

aging

the

within

cultivation

encour¬

cotton,

five

considers

that

cotton

goods

account for 75% of

Ethiopian im¬
is already in pro¬

ports. There
duction at Dire
mill

Dawa

cotton

with 4,000 spindles and

suf¬

ficient looms to

weave into cloth
all the yarn produced
locally.
It
has been in .operation for three

years and has

developed

trained

labor force of sufficient numbers
to be in a position now to double

the number of spindles.
has been very

This mill

overcome, it is expected to con¬
tinue to operate at a profit.
The
government, which owns a half
interest in this mill, intends to
go
on

doubling the capacity
labor

be trained and

can

fast
new

equipment obtained.
2.

Tobacco—With the help of
American experts, it is
hoped to
increase the cultivation of tobacco
to

500,000

five
been

grown

assure

Ethiopia.

Ex¬

the government that

there will be

market for all the

tobacco produced.

Taking a.very
price of 20 cents per pound
and
an
expected yield of 1,000
pounds an acre, it is hoped to de¬
velop a crop having a gross yearly
low

value

United States

$100 mil¬

lion.
3.

Meat—The

nomic

technicians, an
previously

thousand

which

economy

had

employed

many
Italians.
The

trained

whole

economy was handicapped
by the lack of technicians, spare
parts and replacements.

In spite of these and many more

difficulties, the government at the

Mission

American
to

Ethiopia

Eco¬

esti¬

mated that the country has a live¬
stock
population of 22 million
head and that, with the
proper

equipment, meat
value of U. S.

are

Offers

Seagram Debs.

A nationwide group
derwriters headed by
•

99and accrued interest.
The debentures

and increase the number of items

for export have already met with
considerable success. This will be

apparent from the fact that last
year the following products ap¬
peared in Ethiopia's customs re-

gations of Joseph E*: Seagram &
very
small foreign indebtedness Sons, Inc., an Indiana corporation,
which
is a wholly-owned subsidi¬
and no internal
debt>;:-^../:^.v'^Ethiopia's
fiscal
year
begins ary of Distillers Corporation-Sea¬
Sept. 11 of each year and ends grams Limited. The Indiana cor¬
the following Sept. 10.
The Em¬ poration controls, through stock
peror returned to his throne in ownership, all the affiliated Sea¬

and

during the first year all grams operating and sales compa¬
departments operated nies in this country.
on
an
Net proceeds from the sale of
allocation system* alloca¬
tions being made monthly as funds the debentures will be used to re¬
were
required and revenue col¬ tire $50,000,000 of the 20-year
lections
permitted.
Under this 3 % % debentures, due May 1,1965,
1941 and

sys.em,

the treasury was able to
carry forward
a
surplus of $6,693,250.17 at the end of the first

at 105% and accrued interest. Im¬

year.

June

The information and experience

gained during

the first

year

en¬

abled the government to establish

mediately after the delivery of the
20-year 2 J/2%
debentures,
due
to

1966

(which

July 19,

occur

expected

1946), the

company will give the holders of
the 20-year 3%% debentures, due

seeds

295,166

seeds
______

•

251,556
278,256

exceeded estimates and the treas¬

32,350

—

Candles

86,170

.—

oil

Castor

mated at $23,291,690 and the par¬
liament approved a budget pro¬

viding for expenditures of $24,642,822. Revenue collected greatly

10,697

(bottles)

8,536

Mica

pre¬

were

Kilos

Sesame
Mellon

fund

provides

for

retire, through
redemption, by June

1, 1948 and by each June 1 there¬
after, $2,000,000 of debentures and
will operate to retire 76% o| the

issue by maturity.
The

optional redemption price
to and including June Ir

1953

after

duced.

100%

which it is to

after

sinking

June

1964.

fund

commences

at;T01*&%
a

re^

pricef

redemption

declines

scale

The

price

and

also

scale after June 1,

1950.

government

May 1, 1965, the privilege of
j»a budget for the 1942-1943 period.
exported in the following quan¬ Revenue for the period was esti¬ senting their debentures for
the first time

for

turn

Indenture

is 103%

direct obli¬

are

The

purchase or

of 81 un¬
Harriman

Ripley & Co., Inc. is offering to¬
day $50,000,000 of Joseph E. Sea¬
gram & Sons, Inc. 20-year 2 V2 %
Debentures, due. June ■ 1, 1966, at

end of four- years iinds itself in a
sound financial position, with a

•

sinking

diversify agriculture

;.s

Harriman Ripley & Co;

ended

ury

the

second

year

with

accumulated surplus of $9,156,568.95.
Again, for the 1943-1944
an

payment

price

the

full

together with

The consolidated funded debt of
the company and its subsidiaries
will consist of the 2Vfe% deben¬
tures and

Sterling Elec. Motors
Securities
!

approximately $13,000,-

000 of debentures which are sub¬

Market

Maxwell, Marshall & Co. is tol

day offering to the public $500,00(1
15-year 5 % sinking fund deben-

tures, due 1961, and 29,709 share??
common

stock

bentures

each

are

and

pre¬

redemption
accrued in¬

terest.

$3.50

(par $ 1).

the,

common

share.

debentures

Each

has

stock

for

purchase

the

shares.

stock

afc

$1,000

attached

tachable

mon

The de^

being sold at $1,000

purchase

der-

warrant;

100

comA

addition,

four
stockholders of the company will

exports

$9,000,000

the

per year

are

possible. As stated above, the
Ethiopian farmers are not now
selling their livestock but are
building up their herds. There has
been no incentive for them to sell

sell to the principal underwriter
ordinated to the 2V2% debentures.
collections exceeded ex¬
warrants for 19,591 common
All subordinated indebtedness and
shares
Lard
penditures and the accumulated
all of the capital stocks of the at 7 cents a warrant. Proceeds*
Cheese
4,453
surplus at the end of the period
company are owned by its parent. Will be used to finance construc¬
Exports of other new products amounted to $11,896,706.
Distillers
Corporation - Seagrams tion of additional
are increasing as can be seen from
factory build¬
During the year 1944-45 a dras¬ Limited.
the following comparison of ex¬
ing; purchase equipment and maA
tic change was made in the tax
1. Net sales of the
company and
ports for the Ethiopian calendar laws of the
country.
A new land all subsidiaries amounted to $375,- chine tools, retire current bank
years 1937 and 1938:
tax was inaugurated which taxes
181,198 for the fiscal year ending loans and working capital. Sept. 10, '43
Sept. 10, '44 all privately held land within the
T.
to
to
country whether this lan<^ is culti¬
Sept. 10, '44
m
Sept. 10, '45
:•
Kilos
Kilos
vated or not.
At the same time,
487

_____—_:

35,400
15,058
7,102

Rubber

___

period,

;

Edible

oils

Macaroni

653,032

'596,705
13,872,490

Wheat

flour___ 6,869,600
Caster oil seeds-12,740

Cement

402,951

868,000

Rope

3,099,750
94,425

49,967

Tobacco1

10,550

21,158
153,596

79,079

26 miscellaneous taxes were abol¬

ished.

The net result of this

ac¬

NOTICE

tion has been to simplify the col¬
lection of taxes and increase the
amount of tax

other

collec.ed.

leather—

10,895

179,373

budgetary position of the

government is sound.
ter of Finance, His

The Minis¬

done a most outstanding job in
rebuilding and reestablishing the
financial machinery of Ethiopia.

review of the

Imperial
for the

finances of th6

Ethiopian Government
four years since the re-

occupation reveals a determined
policy on the part of the govern¬
ment to hold current

well within

The

ment.

chased abroad.
The

hand,

current

the

new

the

additional

large

THE

other

1944-1945

with

substantial

sur¬

plus after meeting all current ex¬
penditures. In addition, the gov¬
ernment
in the

has

form

considerable
of

assets

ex¬

was

all

sources

which

sources

was

large estate of
government land, subsoil rights
throughout the country, operating
a

gold and platinum mines, complete
ownership of the State Bank and
the Agricultural Bank and part
ownership in various industries.
To evaluate properly the ac¬
complishments of the government
in the field of finance, one must
bear in mind the difficulties un¬

der

which

they
have
been
achieved.
The government took
over
a
country ravaged by six
years of war.
In this war* threequarters of its educated citizens
were

killed in battle

murdered.

population

...

from

their

wantonly

large portion of the
been
displaced
homes and deprived
had

Cash

and

Credits

with

the

State

said; At the office of Continental Illinois National Bank and
Trust

City of New York,

5,079,880

Investments:
State Bank capital & surplus
Sabean

1,500,000

Utility Corp.-

Garage

and

700,000

workshops.

ister of Finance—:.—..
Advances
:
_

Coffee

.Min-

745,567
441,722

plantations-.Reserve

Total

115,929

■

$18,608,178

Officials of the
nance

100,000

Tobacco Monopoly

From and after

to increase by substantial amounts

-will

for the next three years. The esti¬
mated revenue/figure for 1945-46

quarter

this

has

creased to Eth.

now

been

in¬

In
enues

view
are'

cease.

'which
..:

force

mature

August 16,1946, interest on said Debentures
appertaining to said Debentures,
subsequent to August 16, 1946, will be of no

Interest coupons,

effect.

the

factthat

rev¬

constantly; increasing

THE TEXAS COMPANY

;

(formerly named The Texas Corporation)
By L. H. IiNDEMAN, Treasurer
Dated: July 15.1946.

•

$48,000,000 (U. S.,

$19,200,000).

70 Broadway, Ne\y York 15,New York,.

Debentures.

Ministry of Fi¬

Eth; $44,120,000, but in the
light of collections for the first

Coupon Debentures presented and surrendered for redemp¬
tion and payment must have attached all appurtenant interest
coupons maturing after August 16,1946. Registered Debentures
without coupons, and coupon Debentures registered as to principal, presented and surrendered for redemption and payment
must be
accompanied by duly executed instruments of transfer
if payment is desired to other than the
registered holder of such

expect revenues to continue

was

Company of Chicago, at 231 South LaSalle Street, Chi¬

cago 90, Illinois, or at the principal office of Central Hanover
Bank and Trust Company, in the Borough of Manhattan, The

$9,925,080

___

Bank

are
required to be presented and surrendered
16, 1946* for redemption and payment, as afore¬

oh August

follows:

gold in hand

name

Said Debentures

not

cumulated surplus of the govern¬
ment amounted to $18,608,178, in¬

vested

by and between The Texas Corporation (now by
The Texas Company) and Continental Illinois
National Bank and Trust Company of Chicago, as Trustee, The
Texas Company has elected to redeem and
pay, and will redeem
and pay, on August 16, 1946, all of its 3% Debentures, due
April 1, 1959, now outstanding under said Indenture at the
following redemption price, to wit: 103% of the principal
amount of said. Debentures
together with interest on such
principal accrued and unpaid to August 16, 1946.

$41,253,786 wUh expenditures of
$41,099,234. During this year, the
treasury had substantial income

expenditure
from
receipts and

tered into

change of

of $14,000,000 over

from

revenue

.•

is hereby given that, pursuant to the provisions of
Article Third of the Indenture dated as of April 1, 1939, en¬

the financial year 1944-45 show a
total

W;;

Notice

effect

The treasury accounts for

ceeded.

land tax will have

anticipated; but this

was

.i).'

0% DEBENTURES* but APRIL 1, 1959

of the previous year

revenue

CORPORATION

TEXAS
I A-

landed

An increase

REDEMPTION

To the Holders of

of breaking
es'ates which
have been held from generation
to generation without being put to
productive use.

the

tax burden is
lessened for the large majority of
It
thus
appears
certain that
Ethiopia's exports will increase taxpayers who are the peasants
considerably during the coming having small holdings of land and
who previously paid a percentage
years and will permit a large in¬
of their produce, to. the .govern¬
vestment in
capital goods pur¬

Tanned

during the next to build up a surplus for emer- considered as revenue and was
preliminary ex¬ ..gencies. As a result of this policy, not included in the above figure.
steps
have
already the government ended the year At the end of this period the ac¬

taken, and it is now known
that nearly every
type of tobacco
be

be purchased.

were

The

perimental

can

Efforts to

1941, the Ethiopians

faced with the necessity of carry*
ing on, with a mere handful of

acres

years.

perts

equipment

profitable, and now
Excellency
difficulty, that of Yilma
Deressa, a graduate of the
labor force, has been
London School of Economics, has

that the greatest

developing

only in the United

expenditures

years, to be able to
produce 50% of the country's re¬
quirements.
The
importance of
this program can be realized when
one

States that much of the necessary

Hay

Consider¬

able experimentation in the culti¬
vation of cotton has been carried
it

because

Soap

Ethiopia, but because of the
lack of gins, it has been produced

•

be; obtained. This is in large
part a problem of dollar exchange
can

Peanuts

crops:

now

and

technicians and materials required

Beer

Cotton—Cotton is

out

through successfully unless
the government is certain that the

tities:

effort will be made

develop the following
1.

in the

move

This problem
be solved

can

These programs cannot be car¬
ried

in Addis

there

and

kept below July 31, 1945 and net prof it, .after
to official estimates, 760,300 per¬ receipts, there is widespread op¬ interest and income
and profits
sons lost'their lives, 525,000 homes timism
regarding
the
govern¬ taxes, was $10,244,827, The corre¬
were
destroyed and' 13,700,000 ment's future financial stability.
sponding figures for the 1944 fis¬
head
of
livestock
cal
slaughtered.
year
were
$296,034,109 and
Upon the return of the govern¬
$7,796,097.
ment in

According

^vV'vV

of Communism and
- (Continued from first page)
reform and to make war on the Fascism to shackle democracy by
indirection." Mr. Clark added that
;l manners and customs of the peo"no one but a complete crack-pot
pie under the pretext of progress.
This is accomplished by follow- can be deluded by what we see
method

the

against these attempts to; under¬
mine our republican form of gov¬

Economic Cannibalism

The Administraiion's
1>:
*

happening here and the
process
has already reached a
ring the three Marxian command- going on today."
It is encouraging that at least point where the value of the peo¬
ments of the so-called liberal
V apostles of totalitarianism, which one official of the Administration ple's savings is in real jeopardy.
But it is

first,

are,

confuse the language,

and
4-third, undermine, confidence in
r
the, institutions. The chaos that
r results forces the people to accept
second, debase the currency,

all-powerful state.
Now let's get back to the orig¬
inal political meaning of the word
liberal, a meannig which can . be
judged by actions rather than
! speeches.
Historically, the liberal has been
a
person, who opposed arbitrary
an

„

r.. -

•

power on the part of the State and
defended the liberty of the indi¬

i
.

vidual to behave as an individual
in his own interest stopping only

in power

now

has the intelligence

Deficit spending means spending

line," and

bureaucracy.

another piece of paper

value

The road down

Party,

Democrat

consti¬

now

so-called liberalism tuted, is powerless to change its
direction.
It knows
the present Administration has ideological
full well that it has no remote

However,
of

been just the opposite. Under the

guidance of

reason

v
^

•h

today.
The Government's Betrayal of a

tention of the
^'The

archaic tradition.

Then there is the radical group
which has been aptly called the

Party

the most important because, for
all intents and purposes, it has
captured control of the Party. It
is the group which directs
ministration policy.
;

■

of the people's money and

property rights!
Up with human rights!
You can't eat the Constitution!
The Century
Man!

* do not for

Ad¬

suggest
that a majority^ or even a major
fraction of Democrats, believe in
a

moment

this Red-Fascism which seeks to

^ mask itself under the label of lib¬
eralism. What I do mean, how¬
ever, is that members of,this rad¬
ical group have -iti siriuated them -

Selves

into
positions of great
power on the policy-making level
in the Democrat Party and in the

k. present Administration in Wash¬
ington.
They call the tune to
which the Administration dances,
and the tune is

•

strangely like the

Internationale.

The Forgotten

authority than Mr. Tom Clark,
Attorney General of the United
States, who said recently:

It is

"the Welfare State."
All these

for the purpose of

are

hiding from the people the fact
that everything that the govern¬
ment gives them must first be
taken from them. The technique
is

something
of

the

hypnotic

the

so-called

painless
dentist who keeps repeating "it
doesn't hurt yet, does it?"
But
sooner
or
later
the
anesthetic
wears off and then it does hurt.
chant

During the last fourteen years,
American peonle have been

the

exposed to this elaborate array of
slogans and catch-words, all cal¬
culated to achieve this end.
It has resulted in the false illu¬

sion that in
the

Federal

some

magic manner

Government has

be¬

tional

international

and

conspi¬

racy to divide our people, to dis¬
credit
our
institutions, and to

bring about disrespect for our
government."
( Mr. Clark made this statement
in an address before the Chicago

Bar Association in

which, speak¬
ing to his fellow members of the
Bar, he also said:
*
"One of the greatest dangers, in
my opinion, to civil liberties of
our fellow citizens, a nd one which
should be taken literally by all
.

the members of

our

profession, is

will

i You

name

of economic

was

government

liberalism.
ment
the

the

people's confidence in their own
institutions.

commandment

faithfully followed

•

been

viewed

When

proper

to be an evil thing.
stock,

promising

somethnig

There is

into

fraud more repre¬

deceiving the vot¬

than
the

belief

that

can

sought

degree of success to
Supreme Court into a

subservient and partisan political

Administration ir
and use it to distort the

power,

the

partisan

protect that system
than the Republican Party, which •
it from infancy and
consistently protected and
nurtured it.
*
'"V

people.
deception is a relatively
easy one to practice as long as
there is something to be taken
from one group land given to an¬

has

This

•

There are the 40 or 50 million*

insurance

policies whose value depends upon
the earnings of the property ir
which the premiums were in¬
vested.

millions of

objectives.

bearing

thrifty Amer¬
in interest-

savings accounts are in

the same boat with

the holders of

economy
is •
plan—so the govern¬
ment must set up a master plan. ?
Now as a matter ot fact, the .

without

has

had the

in the world.
America has always

omy

had hun- ,
thousands of plans—.
every business has its own plan la >
compete for the good-will of the ,
of

dreds

customer.

'.-t'
had:

•

American business has also
the best control in

the

the Democrat Administrator
economic cannibalism because

economy

planning in the world which •
explains why it is the best econ- •

They are the ones who suffer
property earnings are
depressed and discouraged.
The type of liberalism practiced
by

best

cause

lis?

American

ditional

life insurance.
most when

•

.The Truth About

American

the fraud is exposed.

Blannlhg
One of the false changes Made
by the reformers is that the tra-r
.

legalized confiscation of savings
distribute and

The

known

has

the

of citizens who own life

aualified

give

other.

better

There is no group

world.

govern¬

anything to the
people without first taking it from
ment

icans who have money

And finally they have

They have more
sources than we have.

Its so-called liberal aspects all
to the age-old political

They have made thrift and hard
work a laughing

tool

to us for aid? They '
manpower
than we
natural re- '
They have '
had more years in which to de¬
velop. Yet they come. There must:
be a reason for this, and, to my,
mind, the reason is that our sys¬
tem
is better than theirs. That
system must be preserved if we
are to maintain our place in the •
more

have.

per-

conform

the ones which are

come

have

spective, the Administration

pattern

so-called "Cap¬

our

superior to ours, wbv do

are

they

method is simple.

by the disci¬

They have made private prop¬

some

terns

there is nothing to

has

ples of the New Deal.
They have made success appear
to be a social crime.

make the

are

and

barrel, and when the incentive tr
thrift has been destroyed by the

ment consists Of undermining the

with

italism"

people belong only to God.

But there is a bottom to every

;

sneering

most vociferous in

standing in line for handouts in '
monev, in goods, and in food, from
the United States.
If their sys- •

The American govern¬

commandment for

erty appear

tions who are

the government

belongs to the people,

proof of what I have said
that the very na-

The

lies in the fact

the essence of American

the destruction of orderly govern¬

This

of helpless minorities; a
government bound to respect cer¬
tain inalienable rights of the indi¬
vidual. The radical idea that the
people belong to

Asking

Anti-Capitalist Countries
for Hand-Outs

rights

violates

which saved the world.

in this yvar

It is a government
a

ever devised by man.
That1
America's real secret weapon

the world be- ;

has been, controlled by

goodwill of the customer.

Ever

since

the passage of the

Clay tori and Sherman Acts
^
der Republican Administrations)
the customer has been the eco- '
nomic dictator of America—and a:

under
its restrictions factories- good dictator.
No business—however laree--railroads, power plants and other
can exist without the good-will .of
tools, of product^;whichare the
its customers, and there is nothing'
the success they have attained in
source
of the people's comfort
this endeavor, I can think of no welfare and national strength, are as quick and ruthless as the action
of a dissatisfied customer.
.
,
more effective method of destroybeing consumed "and are not be¬
The freedom of the customer !
ing the people's confidence in our ing replaced.
Can
only
exist
as
long
as
govern•
government.
We all know why .America be¬
Three steps in the Marxian for¬ came strong and prosperous: it if merit stays, out of business andmula have been followed:
allows business to do its own:
because over the last 150 years wr
They have confused the lan¬ accumulated: a vast stock of took planning because government:

errands

and

public brawl between
members of the Court illustrates

Currency Debasement

Confusion of language,
in confusion of economic

resulting
thought,

sets the stage for the second step

the Marxian formula for the
destruction of free government—
in

the debasement of the
through deficit spending,
This the New Dealers have done
to the slow soothing chant of

namely

currency

"it really doesn't
owe

tem

The recent

Artful Language Confusing Public
on1

liberal

up a

considerate of the

conscious and

matter:

it to ourselves."

Many Americans have said that
it can't happen here, that the basic
virtues of thrift, industry and in¬
dividual liberty, are so deeply

guage.

They have debased the cur¬
rency.

They
have
undermined
public confidence iri the tra¬
ditional institutions of ^per¬
sonal

liberty and self-govern¬

ment.

Those

through the thrift and self-denia7
of hundreds of millions of our
citizens.
We

alt know

that it was the

productivity of these tools that
saved
en tire

but the
world from Hitler and Ifinot only America

who

have

plans are, of

necessity, backed by

foroe.

When

there

1st

the planner must

a master plan,*
he the master.

The Constitution: 6? fhe
States
more

came

protested k: Qur. form.; of economic and im?

>!*•" *

wit'j&i-

United

into existence little

than 150 years affo,,

F«r two

thousand years of recorded

rohito.

| 5 kfeS ¥
remember -that

the safety valve,.
third Marxian

provider in whom traditional law of the land for
and to ideological purposes and lend the
liberty should be sur¬ prestige of the Court to political

security.

"We know that there is a na¬

hoiler and then clamping down on

the great

practical as
the fire under a steam

about as

the

of limited powers;

ers

trust must be placed

whom ourrendered in the

the individual.

hensible

turning

being groomed for action.

our

The seriousness of this radical
infiltration is admitted by no less

Man!

provision 1
opportunities for mil- •
lions of Americans. You may call'
that system 'Capitalism" if you •
choose. You may call it anything
you choose. But the fact remains •
that it has worked, and it has
worked better than any other sys¬

premise that

They set
on

of /
of

frontiers, and the

new

for nothing.

Having flooded the country with
government
seeks by artificial price con¬
trols to conceal from the people
the reduced purchasing power of
their savings and of. their income.
is

possible the development
enterprises, the opening

made

ernment because it gave liberty to

now

This

I understand that a new one is

come

Radical Infiltration

of the Common

once

lated any

fne government is best that gov¬
erns least.
It was a liberal gov¬

additional money, the

The Abundant Life!

would wipe
the peo¬

out most of the value of

ple's savings.
Down with

fasten upon
form of gov¬

which is the most important ele¬
ment in the Democrat Party. It is

patter goes something

Fight the forces of reaction!

the political ideology of Moscow,

fantastic

trous inflation which

this:

this Nation the very
ernment against which we have
just waged a great and victorious
war. It is this group, beholden to

people.

a person had accumu- •
surnlus beyond what he •
needed for security, he was free '
to do - with it what he- might •
choose.
This was the element
which provided the surplus cap- ;
ital and tools of production which

that

purchasing

the

government
the

political

This

the chains of

Democrat

Sacred Trust

One of the most sacred trusts

power

captive In the Democrat Party by

Bed-Fascists. It is a group which
seeks, through the medium of the

for high prices

peace-time deficit
shell-game, in
which the hand of the tax collec¬ spending of the Democrat Party is
tor is quicker than the eye of the a flagrant betrayal of that trust.
citizen, requires a fast patter of
As a result,
our nation
now
There is the South which is held trick phrases to distract the at¬ faces the serious threat of disas¬

Party, if it pan be
called a party, which is made-up
of three distinct and mutually an¬
tagonistic elements,

•

resulting

policies

with

of new job

curtailed production, is the basic

money.

the Democrat

people to make the most ofj
opportunities' and to enjoy
the fruits of their own labors.
•
There also was the knowledge

to our

their

Republican Parties have
stood for in their long histories.
Heretofore both parties have rec¬
ognized that the American Colon¬

in circulation and a cor¬
responding decrease in the real
value of that currency. That, cou¬

real

enterprise;

which has. provided^, the*

crat and

currency

and

the Amer-,

of private

ican system

ation from everything the Demo¬

known.

the;
ex¬

American economy; of

many

government

accumulated in¬

planation of this production mi¬
racle lies in the nature of our free

is essentially based upon
Marxian socialism and is a devi¬

ever

It was not

have.

dustrial
experience before
United States was born. The

tration

has been to bring about a tremen¬
dous increase in the volume of

pled

question of experience—,

other nations had

to follow

ists set up the most truly liberal
form of government the world has

ment is found in an analysis of

deficit spending, the same kind

propose

spending which always produces
bankruptcy if practiced by an in¬
dividual. The net result, pf course,

top-flight staff of a chance to retain power without
the vote of those controlled by
group of radicals this "liberalism"
; has consisted of strengthening the these radical groups. So, the only
alternative presented to those who
power of the State and curtailing
wish to preserve our system of
,s the rights of the individual.
4 To borrow a phrase from Mr. government is to take advantage
1 Norman Thomas, the New Deal of the crossroad which will pre¬
sent itself in November and elect
; Administration is made up of what
"t he calls "Totalitarian liberals," a Republican Congress, free of
/.whom he fears "will do more to embarrassing alliances.
The success of the New Deal in
4 bring us Fascism than some of the
people whom they justly de¬ confusing the language accounts
for its success in buying the peo¬
nounce."
The truth of Mr. Thomas' state- ple's votes with the people's own
w

than

both

solely

which they are and this process is still going on.
taking us leads to one inevitable Of course, during the war deficit
end—a one-party system and a
spending was expanded to astro¬
oolice
state.
We have already nomical figures, but what I am
Today the true liberal is one
traveled
dangerously
far.
The
talking about now is peacetime
who opposes the encroachment of

This is the custo¬

war.

Marxian technique, based
ppon the theory, that "when, you
can't attack the message—attack
the messenger." We glory in these
denunciations. The opposition has
been following the radical "party

this radical assault monejr that you do not have. The "the
American line."
•
embarked
upon
Upon our form of government and Admnistration
Socialism in Britain is Britain's
the honesty to admit it publicly, that course as soon as it came
business. ^ v
I am sure the American people into power in 1933 arid during the
Socialism in France is France's
will want to know why the Ad¬ eight peace-time years preceding
business.
"
ministration has not done some¬ Pearl Harbor it spent 34 Billion
Communism in Russia is Rus¬
thing about it during the .past Dollars more than it took in. It
sia's business.
fourteen years/ The answer is, of accomplished this by devising an
•But, by. all that is holy, a re¬
course, that politicians do not bite
ingenious method of creating what publican form of government in
the hands that feed them, and the it called money by trading pieces
America is America's business!
Administration has been receiving of paper. It sold bonds to banks
political sustenance from the rad¬ and then authorized the Federal
Marxian Socialism the Base
icals
ever
since
it came into Reserve Banks to issue currency
The ideology' of. the radical
power.
against the bonds, thus one piece
group which is largely directing
of paper formed the basis for the
policy in the Democrat Adminis¬
The Road to Authoritarianism

point where his actions infringe the equal rights of others
to do the same thing.

question o£ manpower; it was not
a question of natural resources--'
the Russians have far mPre of,

mary

recognize

at the

the late

able to

put-produce any; other nation on
the face of the earth. It was not a

Reactionaries, as Fascists, and as
enemies of some of our allies in

•j.

dustrial organization was

ernment have been denounced as

American citizen
that no government would dare
suck out the sustenance of the
people.
<
■. ■ >■
the

rooted

Thursday;July18*1946

FINANCIAL CHRONICLE

THE COMMERCIAL &

382

and for. tensjof

historv

thousands of years;

'■

■

-:V.,

: A!'

/A
,

Volume 164

Number 4508

before that, man had been
strugigling for a system of governmenl

made, have been made since our
forefathers brought into being' a
new
instrument of government,
ah
instrument
of
government

which would guarantee his
right
."as a" free individual; It is signifi1 cant that in the
century and a half
since our Constitution was
.

which

was liberal because it pro¬
vided for liberty, because it guar¬
anteed the rights of individuals

adopt¬

ed, we have made more progress
in science, in the methods of

•

diicing

■

the

and

protected individuals in the
ownership and use of the results

proneeded
for

things

health, for comfort, and for protectibh, than in all of the centu¬

of their labor.v

Republicans

ries since the beginning of the
^Christian era to the adoption of

era.

water,

horseback,

per-

men were
traveling. by
they were propelled by
by sails, both in the year

A oars or

A.D. and

at the time

the

Con-

stitutional Convention assembled
Philadelphia. If men wished to

»in

communicate

with

each

other.

their messages were carried
by
the same means of
transportation
which I
have? just mentioned

as re¬

name

they wish to con¬
Constitution. > At the time our
tinue the forward march of Amerr
Constitution was adopted, if men
can progress, while the radically
traveled by land, they walked or
controlled Democrat Party in the

Railroads,

•

electric

The

steamboats,
were

the

same

category.

were

Surgeons
without

performed

operations
benefit of anesthetics,
and
out the slightest

and

unknown.

telephone, the telegraph,

and

power

with¬

knowledge of the
preventing infection. As someone so
truly said, it

techniques'

•

then the custom for the surgeon to wash Kis hands after the

[operation, but hot before.
J Compare the conditions"

which

I have just described
with

those

■

| which prevail today. And
ber

that

all

these

remem¬

advances

"$ T?ek goes by the
that

don t find statements in
pers

made

tnat

company,

by this

great ceremony
ing to do this

that.

total State.

Rome,
been

this

Athens and

false

liberalism

a sure road to supreme

zvt0{ ft*?* if they did it would

destroy the business for legitimate
lenders.
To
destroy leiitimate
private credit would

must pay its

has

own

pbwef, because at the end of
the road all the citizens must de¬
pend upon the s ate for their right
to earn and their right to spend

don t think that can

thus become completely sub¬
servient to the state.

You

always get

can

an accurate

readingAof anynation^
by, examining the freedom
citizens to follow their

own

its

pur¬

stalment lending
t;me

That

month

in¬

consumer

were

high—almost

all-

billions.

They contracted to less than $2 bil¬
lions by July 1945—almost 70%.
Was Regulation W
responsible for
the

contraction?

No,

except

possibly a very minor degree. But
stopping production was responsi¬
ble.

The

reason

ment

loans

there

were

frigerators,
and

consumer

fell

off

instal¬

because

was

automobiles, re¬
washing
machines,

forth, on which to make
Had production
continued,
Regulation W would have had
so

loans.

very little effect.
>

;

What

effect do credit regula¬
tions have?
Automobile produc¬
tion is just beginning.
We had
two regulations
covering the sale
cf automobiles to
any person who

buys

one

tion

other

time—one

OPA

Regulation

regula¬

price and the
W on
terms.
,

Could it be possible that with two
government regulations there is a
black market in

here

and

new

automobiles,

there—even

North

Carolina?
Just

industry and employment
long as they do not injure one
another* -and - to develop them¬
selves to the

limit of their God-

that

strong,

freedom

safe

and

the

people's freedom is
safe and strong, and the nation
itself is safe and strong.
We

the

Republican Party
to keep America safe and

propose

credit

strong!

serve

few days ago the Board
of the Federal Re¬

System

;

modified

over

$1,500 exempt from
the regulation, This means if a
borrower is considered good
by a

lender for any amount over
$1,500.
he. can avail himself of
any terms
the traffic will bear both as to

down-payment
the

balance.

and

time

means

through

pay

buyer

receive

favorable

consumer

instalment lending and

the

relationship they have

with potential borrowers
great

responsibility

places a
the indi¬

vidual banker. This is not a time
to encourage consumer
lending for
the purpose of buying goods that
not. available in any quanti¬
ties. Additional pressure to the in¬
are

flationary

forces

could prove more
a

itself.

war

now

work

devastating than

Billions

loosed now in

dollars

credit to

consumer

buying public hungry for goods

denied

them

the

past five years
and not yet available in
quantity
could do

irreparable harm to our
economy. The temptation to start
early in consumer loans and gain
volume quickly is great, but your

responsibility
in

the chief lender

the

important

economy as
world as ours,

strained

calls for

judgment.

For

make available when and

consumer

goods

are

to
re¬

compe¬

tent consumers—all the credit
can

we
as

produced. See

to it that terms do not get out of

hand,

and

above

all, do not let
tempt you to com¬
pete for paper which your better
judgment tells you is unsound.

other lenders

the most important con¬
credit lender; yours is the

are

sumer

greater responsibility.
that

exists

field today,

I call

possibly hap¬

bankers, make

plans; decide on your ap¬
proach to the borrower, either di¬
rect or indirect. When your plans

your

are

made, stick to them; don't be

discouraged, and above all don't

the

your

announcement

con¬

credit

attention

made

IW^ed by whatUpMrx said
to now he

of the Y
company.
nasn t

said

anything and when he
be startling.
Con¬
instalment credit is simple
arithmetic. Your competitor deal*
does it won't

the

kind

same

At best he

do.

can

of dollars you
do as weli as

he can't do better.'

you,

Perhaps the most difficult prob¬
lem facing
many bankers today is
whether or not they should en¬
For

financing

some

on a

time after

begins

trickling into the
market there is hardly any ques-

paper

t on but that it will be the dealer's

choice of who his

financing agent
The dealer will play an

Will be.

important role up to the time the
supply of automobiles (or for that
matter any other consumer dur-

■

aT, S°ods)

somewhere

equals- the

nearly

demand.*" When we
and it is some
years away, it will not be financ¬
ing that will be competitive but
reach that period,

the

selling of automobiles.

That's

d of Deriod we had in 1940

1941.

and
that

Although

banks

many

engaged in a direct
operation in those years found the
were

dealer uncooperative, the figures
showed that the trend of direct

automobile

financing
was
up.
figures at Sept.

Federal

Reserve

1941.

showed

toat

banks

had

outstandings in automobile loans
of

$800 000,000.

about

banks'
were

the

$800,000,000
about
half
to public loans and

direct

toe other half

were

dealer loans.

All automobile loans since the

"made"

all

The announcement
the ■ papers.
Why?

anil

swer.

the

an auto¬

There

We have
bottom

already reached

nun,

about

It is

wonder to

February 1944

mobile

that auto¬

manufacturers

have

not

$377 millions.

attempt at least to

it.

automobile^ but

Actually

sales should

chandising,

matter of

whatever

and

loans

dealer

dropped to $482,000,000, of which
banks held $290,000,000.
Of this
volume held by banks $193,000,-

000, or 67%, was

on a direct basis
$97,000,000 was dealer paper
as of May 1 of this year.
This in¬
crease
in
percentage in
direct
loans during the war years can
be explained partly by the great
and

number

private transactions
place on cars that
were sold by individuals to other
individuals, not through dealers.
took

which

Whether

not

bank

mer¬

have

turned

Our low point in

profit loans

was

the

corner.

all

instalment

in January

1944 when

the dealer is entitled to should be

all outstandings were $503 miK
and not1 lions.> Our
outstandings now are
some amount tucked into the fi¬
well over $1 billion. This does not
the sale of the

irom

car

charge which can never be include industrial banks which
satisfactorily explained. The deal¬ would add another $210 millions.
er s reserve is
something else and
When will paper become avail¬
in
my opinion legitimate.
It is able in quantity? I think it will he

nance

compensation

to the dealer for some time—maybe a
year, maybe
originating the loan, being careful more. Here are some factors tnat
of his credits, and acting in gen¬
I believe will have
a^bearing t>n
eral as the financing agent's rep-,
how soon paper will be availabl
resentative.
t
bad

ferred

practices
much

are

I have
more

'"l!1 strikes' and

re¬

preva¬

labor unrest -will

delay production.

They will also
on
purchases.
do not as a rule spend
or commit themselves to
ers
interested in quick volume^ debt unless:
they feel fairly sure
irom automobile paper there is
about the future.
one way to approach this business
2. Price and credit controls will
and that is through the dealer. In have some influence.
Up to how
developing dealer relations re¬ Regulation W has had very little
member
that
you
represent ,a influence on the contraction of
bank, the reputation of which is consumer credit outstanding. A
something you cannot bargain an anti-inflatonary instrument we
with. To meet competition go as shall now have a chance ^
far as you must without permit¬ what it can do. Informed
people
ting any practice which would re¬ .tell us that we /are already in¬
lent

the sale of used cars, and

have

influence

especially with dealers who han¬ People
dle only used cars. To you bank-5
money

operation?

(2) Are the dealers

lu
,e territory old customers of
the bank?
We

banks

find

that

many

the

experienced

personnel?

the bank.

flect

will

understand

Ethical dealers

the

relationship
you are trying to bring about, the
others you don't want. Remem¬

ber, I said that in a short period
of

little more
competition will be in the sale

maybe

the
of

a year or a

and

cars

the

not

finance

charge.

gage
soon

not

flated 36% in thiscountry m cost

appliance financing as
paper is available. When

manufacturer

wants

nation¬

Those of

of commodities.
pay

bills

our

can

wnp

confim

the

findings of
Regulation W advocates ans^e
this by saying that if it were not
for this regulation andotoercon

thelearned+gentl^ien.

trols

would be

This is not

It appears now as though many
banks over the country will en¬

inflated moq.

very-satisfactory an

but probably true.

swer

sociatto is
that

The As
record as believing

Regulation

abandoned

W stondd Jbe
as
s^PPly
somewhere
-

soon

of durable goods

take -IV-equals the demand.
3. The extent to which money
ers, nothing can quite compare now in circulation—$28 biUionSrrr
with the banking system with its will be used for the
purchase o
wide

mechanism- to

credit

of his distributors and deal¬

care

possible 15,000 outlets. Banks have consumer goods or services will
all the necessary machinery but
discourage the use of
they do need more experience in
4 The extent to which savings
handling this type of paper.
accounts at^$45 bill tons ^ancl indi¬

loar^..

The American Bankers Associa-? vidual
government
has two projects under way of
$64 billions will be cor\verted
which will aid considerably in into consumer durable g0°ds wi l
the
development of' instalment have an effect on consumer credit
tion

business in banks. One of
is the publication
directory which will contain?
the name of every bank in the
country doing an instalment loan !
business. Symbols will be used to I
indicate the various phases of the
paper

these

projects

of a

business

which

each

bank

V°But

with all these factors, and

perhaos others
the contrary
notwithstanding, when the mwket does open there will be tne
,

biggest volume of

^umer ^

^7TelnPaPEeve^1S£Syryneed3

example, personal
dealer
plan,
household equipment dealer plan,
engaged,

for

automobile

loans,
FHA

modernization

book

when

sent

turers

distributors.

turer

can

then turn

find the bank in
town

paper.

This

It will also be

interested

and, if they

their

all

loans.

ready will be avail¬

able to all banks.

which

will

manufac¬

desire, to

manufac¬

to this
a

book

given city

handle

this

The book will be revised

once a year.

should

automobile financing
dealers depends
on
a
number of factors.
(1) Does the
territory to be served indicate a
engage

through

both

automobiles and household equip¬
ment. The increase is very small,

thjj lending phase of the business
and made an
correct

was

Volume changes have also taken
place in all other classifications,

long ago interested themselves in: including

war

time ago by one of the large fi¬

would be 3%.

never

personal loans.
the lowest pe¬
riod for outstandings with $213
millions. They now amount to

Packi +?nd other Practices

country have auto¬
mobile dealer operations that are
nance
companies, in which they entirely different from what we
stated that their rate on whole¬ usually have in mind when we
sale paper or floor plan loans use that term. (3) Do you have
some

lender

uf the "Pack" or extra charges,

The

So I say to you

volume sufficient to warrant such

As further evidence of the
fusion

some

the

The second project will be the

organization of
lection
in

nationwide col¬

system for banks engaged

the instalment loan business.

recently been
sent out to member banks, re¬
questing them to inform the ABA
whether or not they are interested
in participating with other banks
questionnaire

has

collection arrangement on a

reciprocal fee basis. The interest
m
this idea already shown by
banks indicates that the final ar¬
rangement will include over

participants.

8,000

This plan will give

does the potential volume indi¬
the banking system a collection
certainly nothing new cate .sufficient returns for you to
mobile selling for $1,450, would be
service for handling "skip" or
or startling about this; many lend¬
ex.Peri<?nced personnel?
obliged to conform to the regula¬ ers had
that rate in other years. <4)
If the Situation is highly com¬ other specially treated paper that
tion as
to
down-payment and The rate on inventory loans for. petitive, are you willing to conis far superior to anything yet de¬
time, but if he bought an addi¬
this type of financing is one of
tional $100 in
veloped in the credit field.
whl«h
accessories, he could
which, over the years, have be¬
How soon is consumer credit
shop for the best terms possible. negotiation and in past years was come a
part of automobile fi¬
related to the volume of retail
This modification of the
regula¬
nancing? I don't think you should. paper going to be available in any
tion appears to restrict the -credit
paper produced by the dealer.
! Borrowers are becoming more and quantity? I wish I knew the an¬

Who; for example, wants

means

repayment terms.
The current interest of banks in

Regula-

tionW to the extent of making all
credits of

only people with limited

order

credit

sumer

given capacities.

You

of Governors

r''

the borrower pays him the month¬
ly instalment and the onus is on

pen now.

suits of
as

A™ ™. government subsidy.

and

(

way

consumer

ical

and will encourage some of
them
to borrow more than
they? heed in

outstandings in

bad for

S
£ banks'
F1?'continued
would interfere
with the
orderly
would

September 1941.

and
little money besides. The

polit¬

perfect managed
economy, but
up to now that has only been the
subject for intellectual conversa¬

the

one

we can be sure, no one en¬
gages in this business for the sheer

make

From the time

;

dream about
pulling the strings on

regulation

mess

arch-reactionary form of the

(Continued from page 339)

Regulation W is a good example
of the non-effectiveness of
credit
controls. It became a

the

Caution Needed in
Consumer Lending
tion.

pa-

thing

dealer basis.

company

announcing with
that they are go¬

gage m automobile

via

gets

rate or cost conscious,

although

of false liberalism, wants to
takjs the pation back 2000 years tip

was
'

where this type of

cases

loan was made at no interest.

name

know of

aUf
*
>I?1 ndt afraid of
anything like that happening. We
are
dealing here with people who
are m
business, and private bus-

•

- ■

true liberalism

■

attacked

are

actionaries because in the

|Jiaps they were drawn; by horses
In carriages., The same was'
true
atthe beginning of the Christian

;

our

^thejr rode

THE COMMERCIAL & FINANCIAL CHRONICLE

pies will be setting up
the first time. They will reduir

homes^6r

everything to make a home, ma house.
The equipment
now in use in the homes and most
automobiles, will have to he re-

dudfng

placed. K will take years to satefy the demand. Add to this
new

inventions

the

electronics, and tiie
to be in general use by an «
minded generation, and we get
idea of what a tremendous

mfrket liesSi

To aU this add
peorte

tte fert that the American

earnings for many years
its

sumer

adopted
we

existence,

Bankers

Association

a consumer

credit creed.

American

ahead^^

during the f
the Con¬
Credit Committee of the

Five years ago,
year

enter into a new

consumer

may very

lending

and

period-of
one

that

well turn out to be our

greatest opportunity to influence
this field, it might be
fresh

cur

minds

(Continued

well to re¬

with

on page

the

385)

phi-

THE COMMERCIAL &

■(

Control of Spreads

Highlighted
By Herrick, Waddell Case

To Loan Ratification
/

;;.r

344) i;
jection of the loan oh American-:
(Continued from page

•

(Continued from page 335)

')i

» t

't <v

because it is irrecbncilabler

(

i *

' j

? J. •

with the one friade in New
the"5% philosophy"

The rift in the NASD on

that

result in:utter confusion'

York.
is one

foresaw.

Many of the diehards are now

coming around to our

point of view, appreciating that the attempt to control
spreads and 'profits is contrary to hd American way, an^
con¬
that paternalism has no place in doing business.
,
- .,
,

]

1 ~

have been the rules of fair
practice of the NASD by engaging in
thah those of
duct ineonsistent with just and equitable principles of trade
the- granting; of the loan in such
based; Upon an alleged violation of Sections 1 and 4 of Arti¬
humiliating circumstances.
Considerations of pride and pres- cle 3 of the Rules of Fair Practice of thiat assbciation. Both
;tige apart, the unpopularity of the' these, sections relate to the fair pricing. of securities in trans¬
British relations would

■; easier to overcome
*'

£ 'jt

To sustain the decision must

London's Reaction

Thursday, July 18,1946

FINANCIAL CHRONICLE

Iqafr^has^tort^^
actions with a customer.
..
'/• result r of the revaluation of the
Dealing with the same material the- Business Conduct
Canadian dollar, which move is'
widely regarded in part at least Committee of the Washington district and that of the New
as an indirect consequence of the
York district reached diametrically opposed decisions based
loan agreement. One of the main
>objections of the United States to upon identical reports.
After a hearing the New York disciplinary committee
the British-Canadian wheat deal
'£■■■ has been the fact that the price of
voted unanimously to dismiss its complaint.
Canadian wheat has been fixed
The Washington committee, however, censured the re¬
/ considerably below that of Amer¬
spondent
and imposed a fine of $250 towards the cost of the
ican wheat. Since it would have
heen difficult to. meet this objec¬ hearing.
>
;
tion by putting up the price ovf
On appeal to the Board of Governors of the NASD from
Canadian
wheat, the Canadian the decision of its Business Conduct Committee for the Wash¬

UN's Future Will

Follow Paris Meetings

said to have de¬

Government is
cided tron

ington area, the decision

the revaluation of. the

of the Governors resulted in a

of stalemate.
v
reducing the discrepancy between
We are informed that of the 20 members of the Board,
the p£ice of American and Ca¬
18 voted, resulting in a decision of 9 against 9.
nadian wheat. It is claimed in
The legal effect of this stalemate was that the decision
many,-British quarters that, since
in the absence of the loan agree- below had been affirmed.
merit the wheat deal With Canada
The recent release of the SEC set this up as follows:
would have gone through without
"The Board of Governors, unable to agree on the
tegard to the attitude of the
merits of the controversy and being equally divided, sus¬
United States, the extra 10% cost
of the wheat in terms of Sterlings
tained the Committee."
Resulting from the revaluation of
This stupidly contrasting result is no surprise to us.
the Canadian dollar, must now be
When we waged our fight against the "5%. spread phi¬
added to the indirect burden of
the loan.
"
-.l
1
losophy and interpretation," we were aware that many evils
FaMetched assuch- arguments would result from the attempt to control spreads.
may appear, they certainly tend
We said that no good could come from this projected
s, to increase the number of those
Whov would have been relieved type of discipline.
rather
than
otherwise
if
the
We decried the use of the NASD questionnaire as a
Ilouse of Representatives had re¬
decoy.
jected the loan. All the more so
That it has been so used, the record establishes abun¬
as it is now evident that part of
the proceeds at any rate would he dantly.
To be moderate, this record on diametrically opposed
spent on import of American goods
Canadian

dollar

means

(Continued from page 334)
but in the course of his

protest against "the

squeeze" of small nations.

great common denominator of the diplomatic proceedings
raging on both sides of the Atlantic is the growingly intransigeant
position of Russia-versus-the-world. Universally, one is forced to
believe, Moscow's representatives, are operating under permanent
instructions from "the main office," to filibuster against each and
The

every

idea advanced by their

"Allies." For the Molotov and Gromyko

techniques are alike in rising in violent opposition on every occasion;
irrespective of the relevant merits, mechanistically and by rote. This
technique is ascribed to variations of a psychological inferiority com¬
plex, by observers ranging from the veriest layman on the street
to Secretary Byrnes, who this week reported to the nation that "our
Soviet friends fear we would think them weak and soft if they agreed
without

struggle

anything we wanted, even though

they wanted

it too."
$

s[:

sj*

Mr.

conduct

...

■

which could easily be produced in

attitude

was

can

epitomized in Mr. Gromyko's
Council held 10 days ago-

meeting of the Security

and under any
there

simply

diplomatic meeting without a Russian-

instigated riot. Having lunched in the neighbor¬
hood, your correspondent on the day in question
dropped in at a Security Council meeting in New
York's Henry Hudson Hotel with the intention
of spending a few moments to look over the
physical layout of the hotel's converted ball room,
and the presumably purely perfunctory proceed¬
ings attending the submission there of a cut-:
and-dried report from the Atomic Energy Com¬
mission. But with the meeting not two minutes

blast as a minority
objecting to a seemingly routine and
wholly harmless request that the Canadian atom
representative be merely permitted to sit at the
Council table. With all tempers fraying and per¬

old, Mr. Gromyko got into full
of

one,

Andrei

Gromyko

decisions, and antithetical findings, based upon identical re¬
irhispiration flowing, through a loudspeaker system
ported" from countries which do ports by the respondent, mu£t be confounding to the
squeaking in disorder the Russian occupied a full hour in seeking to
not require payment in dollars or ties industry.
t
exercise a grand-scale veto over the unanimous will of his colleagues
hard currencies. The list of Amer¬
It is all the more perplexing when these opposite results on a matter that was wholly inconsequential.
ican goods which the British Gov¬
As an example of the absurd positions that have been, and no
were arrived at by two District Business Conduct Commit¬
ernment has now agreed to im¬
doubt will continue to be, assumed by the Russians, these circum¬
tees functioning as a part of the same organization, the Na¬
port
includes objects such as
stances are worth citing in some detail.
Mr. Gromyko, in elaborate
wooden cloth pegs, and even if tional Association of Securities Dealers.
psuedo-legalistic sophistry, sought to maintain that the attendance of
the amount involved is small it is
It becomes still more involved and disconcerting when the Canadian was a weighty substantive veto-able matter, that is, a
deplored : that the dollars secured we consider that on review the Board of Governors was category of situation defined by the Charter as embracing "settle¬
at the cost of such heavy sacri¬
ment of disputes, adjustment of situations likely,: to dead to disputes,
>'•' • *1"
fices should be "wasted" on^ such, Stalemated.1*^;
determination of threats to the peace, removal of threats td the peace,
what becomes of the SEC determination when the "5% and
unnecessary imports.
suppression of breaches of the peace." This stand was particular¬
J
The British Government is also
philosophy" was being contested, that the mere size of a ly remarkable as flying in the face of the fact that during the San
.criticised for its decision to admit
Francisco Conference and in the midst of the veto controversy there,
spread in and of itself is in effect no evidence of wrong
American
cosmetics,
especially
the Big Four Powers—U. S., USSR., UK. and China—on June 7, 1945
Britain

;

since
-

proving that in weather foul or fair
conceivable set of circumstances,

Gromyko's Latest Filibuster

cantankerous

This

which

has

- would

refused

sectfri-

admit

cosmetics which could
11 have been paid for by reducing

doing?

;

£100,000,000.

It is felt that

^'France is in bad need of urgent
reconomic
assistance, and it is
feared that French opinion will
'resent this discrimination in favor
tof the United States.

more is heard
matters in private

deal

great

{about

these

of NASD to govern

the conduct of their businesses?

the French Government's debt of
over

issued

By what yardstick are the members

.French

Are

they to be controlled by the holding of the Business
district, or are they to

Conduct Committee in the New York

by the decision of the Business
Washington district?

circumscribe their activities

memorandum

formal

specifically defining the category

participate in its discussions when

that member's interests are

definition exactly covered the situation
in question, where the Canadian representative was standing by wait¬
At present there is. only confusion, with more to follow. ing to take the seat prepared for him. In view of Russia kicking up
such a cosmic to-do over a school-room matter, what chance is there
This must result from the lack of uniformity in decision
of cooperation on matters like atomic energy on this side of the
and determination.
Atlantic, or on the disposition of Germany at the Paris Peace Con¬
As we pointed out editorially in our continuous opposi¬ ference?
;

Conduct Committee in the

pi conversation than would appear
|from the extremely restrained tion to the "5% spread interpretation," this un-American
| tone of Parliament and the Brit¬ effort must
result, and it is resulting, in an avalanche of woes
ish press.

questions that were non-substantive and procedural, and hence not
carrying the veto privilege, as follows: "The Council will, by a vote
of any seven of its members, adopt or alter its rules of procedure; . . «
invite a member of the Organization not represented on the Council

However, the immedi-

specially affected,"; which

The Trieste
The

for securities dealers.

|ate reaction to the ratification of
The current SEC release to which we have adverted is
| the loan produced a widespread
^feeling of relief over the conclu¬
only based upon an intermediate motion to open the record
sion Of this prolonged controversy; for the
purpose of introducing additional testimony.
| Moreover, human nature being
;
The SEC denial does not constitute a final disposition
f what it is, even the opponents of
Ithe loan will be pleased to bene- of the decision of the Washington Business Conduct Com¬
\ fit by the immediate increase of mittee based upon the merits.
| imports of newsprint,: petrol, to¬
The review on the merits is still pending before the
bacco and other American goods
Commission and it has an opportunity of righting what we
| Which are in short supply.

•

■.

future

settlement

Firebrand

of Trieste represents

repercussions will crucially pervade

another situation whose
the United Nations' do¬

occur—if not the fate of humanity. The
the most thorny ques¬
neither to Italy, nor to
Yugoslavia, nor to any of the Big Powers. More so even,than Danzig
ever was, will the patched-up Trieste makeshift be the firebrand of
another World War. Already Italian mobs have been demonstrating;
and of greater portent, American troops guarding the Morgan Lin©
in Venezia Giulia have clashed with Yugoslav patrols, with the latter
ambushing and firing on our troops.
Like nearly every> other con-*
consider to be a grievous wrong and of completely exoner¬ troversy coming before the UN, the disposition of Trieste has been
considered by the Great Powers on a basis, that is entirely political
~-and not economic or ethnographic,. .The Atlantic Charter solemnly,
IR. K. Rowley Now With ating the respondent by reversing the determination.
We feel that such reversal is in order and believe that promised that "we seek no aggrandizement, territorial or other¬
| Skall, Joseph & Miller
and there shall be no territorial changes without the express
amongst the many considerations which should lead to that wise,
| •' (Special to THs Financial Chronicle)
wish of the people concerned."
But Trieste and Venezia-Giulia, inV
$ CLEVELAND, O. —Russell K. result are the following:
stead of properly being recognized as an Italian province and city;
Rowley
has
become
associated
1. The result arrived at by the New York District Busi¬ with a protected Slavic minority, are ridiculously to be "internation¬
with Skall, Joseph, Miller & Co.,
alized" among powers who have inexorably demonstrated ihe_ im¬
ness Conduct Committee;
Union Commerce Building, mem¬
And it is
r 2vThe stalemate of the Board of Governors of the NASD possibility of their getting along together om anything.
bers of the New York and Cleve¬
provided that the area is to be protected by the United Nations, thus
land Stock Exchanges. Mr. Row¬ in its review of the determination of the Washington District
directly involving the organization.
>
:
T

ings, wherever they may

shot-gun coimpromise finally reached on this,
tion on the Ministers' Paris agenda, is pleasing

ley was formerly with F. L. Dupree & Co. of Harlan, Kentuckv
and prior thereto was with Blyth
& Co., Inc. in

Cleveland.

Business Conduct Committee;

3. The. SEC

:•% % V alone

wrong

precedent that from the size of
doing may be inferred;

spread

differs radically and completely from our
State Department's policy in regard thereto, as embraced all through
theiWqr^^G-h3.^
totentipnstof jcedmgtorrito^ies^like priga^Tenda^
-

The

present result

[Volume 164-

THE COMMERCIAL & FINANCIAL CHRONICLE

Number. 4508

385
: '-> *'

7.V

■:

r~ir"'

Mont Cenis from

...--I..-XI*-■

Italy to" France.

■

And Italy

was

^-w,v;' V,i ;•/:

,h..>

•

to retain both

terms of dollars. Sometimes it

■§&.$* A

£ Trieste and

Tomorrow's

The Unfair Italian Settlement

rv.,
•
,
The net result of the peace "negotiations thusfaristh&tbt all the
countries which fought for the Axis, Italy which first became an
Allied co-belligerent (to the accompaniment of copious Allied prom¬

Walter

around

Nice.

Africa.

UN,

through Britain,
V

Furthermore

loses her colonies

she

partial appeasement of Russia's absurd repara¬
otherwise unsatis¬
factory. The Soviets are to get $100,000,000 from a country desper¬
ately in need of a reconstruction loan from us—the tribute to come
from production smarting two years. hence.
Russia's great gesture
of "concession'! in fhe inatter is agreement to a provision 'that the de¬
liveries are-to "avoid interference, with economic reconstruction."
The effect* on the United Nations is derived .from the net result
being another ease, like in Germany, of the United. States actually
acting as the once-removed subsidizer of tribute going to a fellow
member (Russia). -• • ••
1
•
.

The Climactic German Problem:.

action

after World War II than after

But hopes of a better settlement there
the

"appalling."

denberg reports, the disagreement is
<

As Senator Van-

preceding conflicts surely seem unwarranted.

place we have the current situation in Germany em¬
complete breakdown of the Potsdam Agreement. In place
of the centralized administration as one economic unit, which was
In the first

bodying

that pact, the country is split into four completely
closed and segregated compartments. With trade and all semblance
of commerce automatically cut off between zones, and with the
Soviet expropriating current German production, the United States
and Great Britain, far from collecting reparations, are footing an
annual bill of half a billion dollars in occupation costs.
specified

which

led

column's bearish advice weeks

still the

ago

Nearby

same.

technical base under 200 im¬

portant level

decline to

for

stop.
The
tumble

market

took

Monday

on one

reasons

another

of the
haye yet

heard. Whether the reason'I

By far the most important problem before the victorious Allies
such and as it affects the UN organization, is a German settlement.

Irrespective of M. Molotov's diabolical double talk pronounce¬
policy toward Germany, ostensibly making a grand¬

ment on Russian

stand plea for a unified Germany, it is certain that she is going to
pin her policy on a unified Germany under permanent Moscow dom¬
ination. It is this aim which is motivating her stalling on settlements

With either Germany or Austria.

the

new

ably

got

widespread

know.

this

neck

woods where I'm

run

don't
of

the

spending

latest market

crack is

anticipated the

$2,500,000£000 in bonds. Against this
there is an anticipated na¬
tional revenue of about $4i

news.

contradictorially

disposition, will

Surely this situation and Germany's necessary

existence of the international organization.
As
hinted at as a possibility by Secretary Byrnes, is German militarism
tragically to become a political pawn between the East and West,
that is, between the UN leaders?
In any event, in immediate im¬
portance, it completely dwarfs all the diplomatic squabbling and
maneuvering which may be staged under its august aegis.
control

the

very

$duiioii Weeded in

First Boston Group

Consumer Lending

Wins Two issues

We have been seeing a one¬

cumulative effects will not be
seen

in income statements for >

months.

many

•down.

It is

if all

sociates

Consumer Credit Creed

That, in order to
justify its charter, a bank must
We

serve

believe,
the

reasonable

credit

re¬

quirements of its territory as well
.as provide
a safe depository for
funds;
That the extension of credit to
salaried

uals

or
a

wage-earning individ¬

sound basis

service; V;
That, while recognizing the im¬
portance of volume in the reduc¬
tion of loan costs, a bank should
•endeavor to assist people to get
out of debt rather than into- it;
That, although a bank must be
competitive, it must maintain its
practices and policies on a plane
'which will not bring disrepute to
banking, atid keep all advertising
.restrained, truthful, and exact;
v;"? That a bank must determine for

directly to the public or
through others, but that no bank
should uphold or assist such others
when they indulge in unfair bus¬
iness practices;
v : That a bank should determine
.the costs and hazards inherent in
such credit and establish its loan

bank which extends
-credit to individuals under these
any

will

issues—$45,000,000
bonds, series C,
due June 15, 1970, and $9,500,000
of sinking fund debentures, due
June 15, 1961.
The winning bid
American-pay

of
and on
the debentures 100.639 for a 2%%
the

103.679

named

bonds

for

merit
-

attain

was

I learned that

forecast

one

ever

99 WALL STREET

of its chief

the

beginning of the
its ability
year the Federal budget was
coming events in to be $35 billion. Last week
will

International Minerals

about

have

scaled

This does not take into effect

Co.'s

offering of $10,000,000 of series D
(Canadian-pay)

bonds,

maturing

went to Dominion
and

coupon.

mortgage

June

15,

1970,

Securities, Ltd.,
bid

The winning

associates.

named a

first

price of 103 for a 3Y^%

Reoffering of the bonds

J SUGAR ||||

Louis Ware, president of Inter¬
national
Minerals
&
Chemical

Award of Gatineau Power

NEW YORK 5, N. Y.

learned that the amount

Corp.
Exchange

this

those of the author only.)

was

Unsubscribed Shares of

rlTK& views expressed in

article do not necessarily at any
time coincide with those of the
Chronicle; They ax^

est

and interest

afraid

I'm

come to the wrong
I have neither the time

with the

Sold

publicly
reoffered the
17 at 104.37 and inter¬
and the debentures at 101.23

$600,000.

you've

LAMBORN & CO.
❖

thing like the market,

characteristics
to

faster than

& Chemical

and as¬

sociates

Exports—Imports—Futures

DIgby 4-2727

Corp.,

announced July
12 that
stockholders have exercised their

rights
shares

stock

Pacific Coast

purchase

all but 6,761
$5 par value common
out of a total of 131,769
of

shares which

were

Established

offered for sub¬

scription at $32.50 under a plan
permitting each shareholder to

Orders Executed

H. Hentz & Co.

.'■l:

buy one new share for each five
shares held.

Pacific Coast

1858
fiJt

Securities
Exchanges

Members

York

New

-v,;'

Stock

Exchange

Curb

Exchange

Cotton

Exchange

will be made by
ities at

Dominion Secur¬

104.50 and interest.

Announcement
that

also

was

had been sold

privately at

made

cost

to the company of 2%. ;i

ceeds from sale of the various is¬

together with; other funds,

retirement

its: outstanding
'

stock

made available

Schwabacher & Co.
New

Exchange.

The

manner

underwrit¬

Ob 1 oa g o

Board

•

Trad/»

Orleans Cotton Exchange
:

(Associate)

Chicago Board of Trade

unsub¬

ing group, headed by White, Weld

;

Inc.

Exchange,

And other Exchanges

York Stock Exchange

New York Curb Exchange

Commodity

New

Members

ceased July 8 on the New York

scribed shares will be sold on the
New York Stock Exchange in the

York

New

July 8. Trading in the rights also

regular

York

New

was

shareholders of record June 24,
With
purchase
rights
expiring

Stock

Gatineau Power will apply pro¬

sues,

The
;o

$7,000,00 of new debentures

higher-cost debt,

can

bonds July

The First Boston Corp.

general public.

an ' -»•.

••

15% due to upped de¬
mands by the armed forces.

For

stability l}by bal¬
couple of months ago I ancing the budget. Congress
said here that the buyers who
agrees in its public speeches.
were
pinning their hopes on But while it beats its breast
profits on an inflation mar¬ with one hand it is spending,

price

coupon

coupon.

the good will and support of the

charges accordingly; and, finally,

practice

•!*

other.

issues.

man.

life. Ever since I knew there

of first mortgage

advised

ish loan, But

best

ket didn't know the facts of

leads
advice.

example it approved the Brit¬
or
the inclination to solve
by its action re
they • are
iperely excuses for "Josses. It price control it also cut the personal problems. My/ad¬
vice to buy or sell is limited
seems to me,
however, that if purchasing power of this loan
to this column. T have no in¬
the market is
feeding on in¬ by at least 10%.
terest
in
the size of any
*
*
*
flation fodder, a veto of the
reader's
bankroll. Sorry I
latest bill would give it so
If we are to get our share
can't help you.
■■—
much additional food that in¬
of foreign markets it is ob¬
*
*
#
' V'V
—-V
stead of stocks moving up in
vious that we must have a
More next Thursday.
fractions they would
gallop stable dollar. We don't have
—Walter Whyte
up by points, or maybe better. it. There is sound;, belief we
me.

July 15 were awarded

Itself whether it will offer its ser¬

vices

international

both of Gatineau Power Co.'s new

standards

reasons never con¬

cern

eco¬

nomically important part of such

That

again that

*!*

The First Boston Corp. and as¬

since

seen

liquidation,

me
to
problem now' is why,
change my
ceilings are off, does the
market go down. I don't know
W. G., Santa Monica: I am
the answer. But I suspect
that part of it can be found flattered that you ask my ad¬
how to handle
in a Congress more concerned vice about

have said here time and time

follows:

market;

The

being forehanded, is already '
anticipating them. How much
lower it will go before it
stages a rally I don't kriow.
But I do know that nothing* I:;
have

(Continued from page 383)
losophy which this creed lays

,the anticipated

big
buying of goods which was to
way market for a long time. take up the increased produce
You may recall that while tion dammed up by price con¬
stocks were going up there trol hasn't developed. For one
were quite a
large number of thing production hasn*t •
companies
which reported stepped up because the pro¬
losses, or at least smaller ducer doesn't know from day *
profits than generally' antic¬ to day what his raw materials
ipated, but still the market Will cost. So he's producing
went up. It doesn't require very slowly and not building:
any great amount of gray up his inventory. .The^ultir ^
matter to realize that stocks mate consumer, pinched by
went up on anticipation not skyrocketing retail prices, is
reflection. This anticipation slowing up his buying? The
see

demilitarizatiwv and deThe reason for the
$10 bil¬
Monday
into oc¬ spill, according to a Danbury
cupation zones until this fantastic amount is paid. It must be realized financial
pundit, is that the
that Russia has already annexed a quarter of a million miles of
latest OP A bill concocted by
territory with all its people and goods, and has turned 40,000 square
miles additional over to Poland. The "net" of the Soviets' political Congress
will be vetoed. I with local than with national your
arations

v-q/r

The

Specifically, apart from the complete

perhaps a hundred years. This would entail permanent partition into
separate zones, with complete Communization of the Russian zone—
a 100-year armed truce between the victorious "Allies"!
?

mil¬

lion in cash and

prob¬

ably widespread.

Nazification provided under Potsdam, Moscow is demanding
lion in reparations and continuation of the present division

anomalous insistence on enormous rep¬
accompanied by de-industrialization for

prob¬

to about $500

the market refused to con¬ billion. If taxes are cut,
per*
form to the news, forgetting sonal or
corporate, the Yfcvdr
that its previous action had nue will be smaller.
*;.
*
*
*
*• " •>

couple of weeks, I don't get
much
opportunity to hear
rumors and whether
they're
widely accepted as facts. But was some sort of inflation. So
if the boys who run the local Congress let go the reins and
brokerage office listen to, and gave the signal for inflation
peddle out the same sort of and oddly enough the market
gobble-gobble I hear in the didn't go up. It didn't have
pine paneled customers' to. It had already gone up
rooms
in Wall Street, then plenty in expectation of the
the current excuse for the end of price control.

and economic demands is the

terminal leave allow¬

to vets. .This will

ances.

Market

screwiest

Whyte

=% WALTER WHYTEs

our

tions demands there is economically unsound and

far in advance of the

that when the news be¬
came
public the maj ority pf
traders forgot what started
the whole thing. So the same
traders were, chagrined when

Says—

news,

Markets

ises), now fares the very worst,. To Greece, she loses the Dodecanese
Islands in the Aegean. To France she loses the Briga-Tenda territory
-

acted

COrtlandt
--

;

'•

7-4150
:

N. Y. Cotton Exchange Bldg.

New York S, N. Y.

14 Wall Street

NEW YORK 4,

Teletype NT 1-928

;

San Francisco— Santa Barbara

Monterey

—

Oakland
Fresno

—

N. Y.

-vv

Private Wires to Principal Offices
.

Sacramento

CHICAGO

DETROIT

PITTSBURGH

; GENEVA, SWITZERLAND

Abbott

JUly 9 filed

Laboratories, North Chicago,

Iff. <8/141

mum

169,991 common shares (no par)< Under¬
Co., Inc.; F. S. Moseley & Co.,

writers—A. G. Becker &

Offering—Cc^pany is offering to
common shareholders rights to subscribe for these shares
on the basis of one
share for each 10 common shares

and Shields &:

Co,

Proceeds—Refunding and

amendment.
general corporate purposes.
Price by

held.

N. Y. (7/29-31)
June 26 filed 132,740 shares
($1: par) common stock.
Underwriters—Herrick, Waddell & Co., Inc., and First
Colony Corp.
Offering—To be offered publicly at $5
a share*
Proeeeds^Company will receive proceeds from
the sale of 68,880 shares and four selling stockholders
the proceeds from the sale of 63,860 shares;
Company
also will receive proceeds from the sale of 20,00ft war¬
rants for ctirmon stock to underwriters at an aggregate
price of $200/ Of the? net proceeds ($292,940) ■ $50,00ft
will be used to pay current bank loans; about $20,00ft
will be used for machinery and equipment, and the re¬
Acme

Electric Corp., Cuba,

mainder for working

capital.

Admiral Corp., of

Canada, Ltd., Toronto

$2 a share.
Proceeds^-$75,000 Is earmarked
chase of machinery and equipment, and tools,
and fixtures; baxance will be available for

for pur¬
jigs, dies
corporate

of comm^
an additional number determinable only after the re¬
sults of competitive bidding are known; Underwriters^—
To be filed' by amendment
Probable bidders include
Dillon, Read & Co. Inc., White Weld & Co., and Shields
& Co.
(jointly), and W. C. Langley & Co. j and The
First Boston Corp. (Jointly).
Offering—Price i to public
by amendment.
Purpose—The common stock, together
with $15,000,000 10-year 3% collateral trust bonds (to
be sold privately) are to be issued to acquire certain
assets of American Water Works & Electric,' liquidate
two subsidiaries, Community Water Service. Co.
and
Ohio Cities Water Corp., and provide cash working capi¬
tal.
Common stock is to be offered initially for cash
to common stockholders of parent and to public holders
of preferred stocks of Community and Ohio in exchange

//?;;:'/

Arkansas

•

~///^

additions.

/!-'■■";■://'■?.:■-

■' ■
Ben-Hur Products, Inc.,

•

-v- ■■'/j:/
Los Angeles

'
(7/23)

Shares are being sold

(with detachable common stock warrants attached), due*
June 1, 1966.
Underwriter—P. W. Brooks & Co., of New /
York.
Offering—To-be initially offered in exchange for?

principal amount of 10-year 5% convertible de-J'
as of Feb. 1, 1941.
Upon surrender of
of old debentures company will issue $1,000
of new debentures and warrants and pay $50 to the.
holder of the old debenture surrendered together with
accrued interest ori the old debenture to June 1, 1946/
like

bentures, dated

Upon the expiration of the exchange period, new
tures not so exchanged will be publiciy qffered.

deben/
Price'

debentures!

Proceed*-—'To redeem old

amendment.

Business—WholesaTe marketing '

and reduce bank loans.

products manufactured and processed
Los Angeles.

(7/31)

Chicago

debentures

July 11 filed $1,000,000 of 5% sinking fund
'

Armour and Co.,

(7/31)

each $1,000

filed 33,639 shares of common stock (par $5).
Underwriters—Rauscher, Pierce & Co. Inc., and E. H.
Rollins & Sons Inc.
Offering—Stock will be offered to

public. Price by amendment.
by six stockholders.

common stock to be publicly offered at $10 a share.
Ncu
-underwriting;:; Offering will be made to present share- /
(holders, Proceeds^—-Proceeds initially gfr tq general funds ■
and may be used to pay part of costs of construction of/

•

June 5

the

Belden

underwriters.

;
Fayettevilie

Gas Co.,

West.

':rr! -i.t: ■-v„ /
;
\
Mfg. Co., Chicago
; ;
'J'M
July 3 (letter of notification) 26,530 shares; ($10 par)
v.-.....

■

Stock not subscribed or issued under

exchange offers are to be sold for cash to
For details see issue of April 4.

•

purposes.

Inc., N. Y.

American Water Works Co.,

0.11424 shares of

preifferred for each share of common held/ -Unsubscribed •
shares will be offered publicly.
Price by -amendment/;
Proceeds—Net proceeds, with other funds, will be used^
to pay off $4,600;0(10 bank loan.
Business—Manufacture <
of cotton and rayon fabrics. ,..;•••/
^ -./v.
v-v

Match 30 filed 2,343,1Q5 shares

(7/29)

July 8 filed 150,000 shares ($1 par) common stock.
Underwriters—Dempsey & Co. Offerings—Company will
offer this stock initially to its common stockholders at

'IT':?'///'v1

for their shares.

■"iU

to, common stockholders at the rate of

each. Price, $25 a share./Proceeds—

of 400 shares

For investment.

•m

SINCE PREVIOUS ISSUE

INDICATES ADDITIONS

•

Registration

Now in

Securities

/Thursday, July 18* 1946-

CHRONICLE

& FINANCIAL

THE COMMERCIAL

386

at its plant in;

......

Transport Corp., New York
($1 par) common, stock.
Underwriters—By amendment.
Price by amendment.
Proceeds—Of the total, 35,000 shares are being sold by
stockholders and the remainder by the company.
The
latter will use $60,000 of the proceeds to repay a bank
loan, about $500,000 for new equipment and $250,000 for
ground installations at various points in the United
States.
f
Air Cargo

filed 435,00ft shares

June

/9AEI-Amejric&iiDrinks Corp., New York
July 10 (letter of

notification) 100,000 shares ($1 par)

i Offering—Pricey $1 a
initial working capital.

share.

stock,
For

No underwriting.
Inc., N. Y.

American

Eroadcasting

Co.,

filed

950,000 shares

($1 par) common stock.

June

UhderwriteJr^Dillon,^Read &
New York* Offer¬
ing—A maximum of 100,000 shares may be soldi by com¬
pany to persons, firms, 'or corporations with whom the
corporation had network affiliation agreements on March
31. The remainder will be offered publicly.
Price by
amendment. Proceeds—'Company will use $4,000,000 to
prepay 2% notes, due Oct. 14f 194?, and about $2,800,000
for acquisition of radio station WXYZ at Detroit.
Balance will be added to general funds.
Americas* Cladmetals Co., of

•

Pittsburgh (7/29)

July 8 filed 196,500 units comprising 196,500 shares of
voting common stock ($1 par) and 589,500 shares of non¬
voting common stock ($1 par >r each unit consisting of
1 share of voting common and 2 shares of non-voting
common. * Underwriters"—None;—the company intends, to
distribute its common stock directly to the public. Offer¬
ing—Price

Proceeds-^-Net proceeds esti¬

$6 per unit.

mated at $1,179,000

will be used td pay a, mortgage o»

plantr pay accounts payable, purchase equipment,
building alterations and working capital./
American Heme Products Corp., New

for

York

28, 1946 filed 116,926 shares of ($i par) capital
stock.
Underwriters—-No underwriting* Offering—The
shares will be offered to stockholders of record July 31
in ratio of one new share for each 10 shares held. The
June

offering of unsubscribed shares will be deter¬
mined by the directors. Price by amendment. Proceeds
-—Liquidation of $6,000,000 short term bank loans; bal¬
terms of

ance

purchase additional land, plants;, machinery, etc.

July 12 filed 350,000 shares

Co., New York.
Offering—The 350,000 shares of first
preference stock will be offered in exchange to holders
of its 532,956 shares of $6 cumulative convertible prior

preferred stock at the rate of 1.4 shares of first
ence stock for each share of $6 prior preferred.

■-/

American Research &
•

Development Corp.,

The 1,355,240 shares of
subscription to common
stockholders of the company in the ratio of one-third
of a new share for each common share held.
Unsub¬
scribed shares of common will be purchased by the
underwriters.
Price—Public offering prices by amend¬
publicly.

stock will be offered
common

ment,

will

offered

for

used to> retire all

Proceeds—Net proceeds will be

redeem its
Business—Meat pack¬

Co., Inc.

Offering

—

To institutional investors at a
each, and to others at a mini¬

outstanding 7% preferred stock.
ing business.
Associated

•

Spring Corp., Bristol, Conn.

1946 filed 13,500 shares ($100 par) cumulative
preferred stock and 15,000 shares ($1 par) common stock.
Underwriters—Dillon, Read & Co. Inc., New York.
Of¬
fering—Company will offer 8,500 shares of preferred in
exchange for shares of outstanding 5% preferred stock
on
a
share for share basis.
Common initially will be
offered for subscription to common stockholders of rec-'
ord on July 19, in ratio of 3/2Cth of one share of new
common for each
share held.
Unsubscribed shares of
common and remaining shares of preferred will be of¬
fered to the public at prices supplied by amendment.
Proceeds—Net proceeds will be used to redeem, unex¬
changed shares of

5% preferred at $110 a share and

accrued dividends

and to pay for other corporate pur-;

poses.

(8/5)

Brewster Aeronautical

Corp., New York

July 11 (letter of notification) 8,000 shares of stock on
behalf of James Work, Chairman of the board of direc¬
the company.

tors of

Offering—Price at market. Hirsch

July

proceeds, together with other funds, to build a $1918,000
addition to its Bristol plant.
Business—Manufacturer

officers

•

Bridgton Airport, Inc., of Bridgton, Maine

(letter ' of

amount of

notification.)

$10,000

aggregate

stock and $10 par value

$100 par common

No underwriters—
Proceeds—To
purchase, build and maintain a small airport. J

preferred stock, to be sold at par.

and directors will sell the stock.

be used to

precision springs.
Brooklyn (N. Y.)

(7/22-26)
Feb. 23 filed 30,000 shares of series A cumulative-pre¬
ferred stock ($50 par).
Dividend rate by amendment.
Underwriters—Blyth & Co., Inc., heads the underwrit¬
ing group. Proceeds—Net proceeds wilt be used as part
of the company!® working capital to convert to and en¬
gage in peacetime manufacture of its normal products
and of sucht hew products as the company may 1 hereafter
Atlas

Imperial Diesel Engine Co.

determine.
•

Baltimore

'/ .?'"/■

' '

Castings Corp.

(Md.)

Np underwriting.

For

?eqqipping ^and operating- business and?other expenses.??
Manufacturing Co., Lewiston,

(8/6)

Me.

July 17 filed 45^0ft shares ($100 pari cumulatiye pre-:
ferred stock.; Underwriters—Coffin & BUrr;" In<v Bos¬
ton.
Offering—4FO; bet offered initially for subscription

(jointly);

Corp-,

The

First

Boston

(EDST) July 23, at company's office, 176 Remsen Street,1
Brooklyn, N. Y.; the dividend rate to be specified in
,

? /

(7/29)

preferred
attached,
and T5>0QQ^^ shares ($l' pal) comihoit stock,; Company isoffering all of the preferred and 25,00ft shares of com-

July 8 filed 30,000 shares of 4}k% cumulative
gtock ($25 par),, with §tock purchase* warrants

The^^remaining 50,000 shares of cdimnon ai»

feeing

Slann//President/ Benjamin
A. Pollock, Vice-President, and Bernard Feldman, Sec¬
retary and Treasurer.
Underwriters—R. S. Dickson &'
Co;, Inc;/Courts' &r Co^^Jcdnison^Lane^^pace &
Inc.;
-Clement A. Evans & Co., Inc., and Rauscher, Pierce & Co.'
sold for the account of Dv t;.

☆

\r.

'J ''

■'

/ v''

—

TJnMrwriters;an&

C.J. DEVINE

:ehT

Corparate

Municipal Bonds
'■

/• )\'/' _•

•"

-'t

/
.

48 WALL ST., NEW YORK 5,

CORPORATION
H

Chicago

Boston

♦

Cincinnati

St. Louis

Securities

Kidder, Peabody8?Co,

CO.

Founded 1865

N. Y.

Philadelphia
*

and Municipal

*. •

INC.

FIRST BOSTON

☆

(7/23)

Corp.; Blyth & Co., Inc., F. S. Moseley & Co., and Otis &
Co. Bids Invited—"Bids will he received up to 11:30 a.m..

Unitecf Sfafes Government Securities

Chicago and other cities '

Securities

Mellon

Butler's, Inc., Atlanta, Ga.

($100 par)
shares ($L
par) common stock. Offering price—-The 2,9501 shares of
preferred with a like number of common will be sold in

Bates

Union Gas Co.

May 3 filed 70,000 shares of cumulative preferred stock'
($100 par). Underwriters—To.be filed by amendment.
Probable bidders include Harriman Ripley & Co., and

the bid.

July 10 (letter of notification) 2,95ft shares
2Vi% cumulative preferred stock and 4,95ft

State and

Rapid City,"

July 2,

Company wiO receive proceeds from the saleof .§4J690
shares and six selling stockholders will receive proceeds
from the sale of 65,000 shares.
Company will use its

Corporate and Public Financing

Boston •;

Light Co.,

and

Power

(7/23-24)

& Co. will sell stock as brokers.

SPECIALISTS IN

•

Hills

July 16 filed 119,690 shares ($10 par) common stock.
Underwriters—Lee, Higginson Corp., New York.
Offer¬
ing—To the public.
Price by amendment.
Proceed*—

☆

NewYork

Black

unexchanged shares of $6 prior stock and to

•

minimum of 1,000 shares

preference not issued in exchange wiil be sold
to underwriters. The 300,000 shares of second preference

Boston

July V1S4& filed 20ftj)00 shares ($1 par) common. Un¬
derwriters—Estabrook & Co., and Harriman Ripley - &

prefer¬

of first

units of one share each for $101.
'

cumulative first

(no: par)

preference stock, Series A; 300,000 shares of convertible
second preference stock, Series A, and 1,355,240 shares
common stock
(par $5).
Underwriter—-Kuhn, Loeb &

•

HAnever 2-2727

■v;

Members

of the Nm< York anet Boston Stock Exchanges

•NEW-YORK- /'

P'ttsborghr ♦- C?«velciid

San rrancisco

☆

BosTds

'pHiLAbELPHiA.

CHICAGO.

Volume 164

Number 4508

THE COMMERCIAL & FINANCIAL CHRONICLE

Offering

eikk

from

the; purchase of the capital stock at $16.66%
Proceeds—To be added to general funds.

Prices by ^amendment/ Proceeds'—^ Proceeds
the) sale by the xompany bf ; 30,000 - sharea of pre¬

arid, 25,000;; shares of

ferred

common will be used to re-*

tire, the presently outstanding 6% cumulative preferred
stock, modernization of existing units, opening of new
units and additional working capital,
; :
V':V. >£"-?'

•j,:

'r/;

■

••:

■

••

-!;■

Columbia Aircraft Products
June

3; California Oregon Power

filed

150,000 shares

for;
share.

Inc., Somerville,

($4 par) 30c cumulative

convertible preferred stock, convertible into common
stock in the ratio initially of 1^ shares of common for
each share of preferred. >

May 24 filed 312,000 shares of :common stock (no par).
StockI Willbe shld' throhgh^COttipdtitive^bidding.
Underwritefs-^Names by amendment.

stockiH^lce-^Options already issued provide

Probable; bidders in?

Underwriters—Floyd D. Cerf
Offering — Company initially will

Co;, The., Chicago.

clu^ fi|ythJ ^ ^o4 Jncj^h^ Pir^^Boston

offer 59,585% shares for

July

bids

for the

purchase of the stock

un¬

public through underwriters.

Price—$5 a share.
Pro¬
ceeds—Approximately $55,000 for payment of Federal
taxes; $250,0005 for payment of a loan; $50,(100 as a loan
to

stock (par $1).
Toronto.
Offer¬

common

Underwriters—Sabiston-Hughes,

Ltd.,

Palmer Brothers Engines
Inc., a

working capital.

I*roceeds—Net proceeds, estimated at $300,000, will be
used for mining operations.? .Business—Exploring for

Columbia Empire

....

■July 1

(letter of notification) 23,015 shares of Class A
shares of Class B stock.
No underwriters.

9,206

T<f be offered in units of 5 shares of Class A
and 2 shares
of Class B at $60 a

I Cardiff Fiuorite Mihes Ltd., Tor6nto, Can.

Founders, Inc., Vancouver,

Wash.

and
.....

unit, in cash on deferred payments
through salesman employed on commission basis. Pro¬

iJune 3 filed 400,000 shares of common stock ($1 par)
(Canadian funds).
Underwriter — Frank
P. Hunt,
Rochester, N. Y., is underwriter for sale of stock in
Uni ed States.
Offering—Stock will be sold to public
.at 55 cents a share.
Proceeds—Of the net proceeds, $40,600 together with $22,000 of treasury funds, will be used
for development work.
If sufficient ore is found, company will efeci a mill at sin estimated eost of .$150^)00.
.The balance will go into working capital.
Business—
^Company intends to explore for the mineral known as

ceeds—To be used for the organization of a life insur¬
ance
company and a fire and inland marine insurance

Commonwealth Aviation Corp., New York

June 28, 1946 filed 150,000 shares
($10 par)
lative convertible preferred stock and

4J/2%

cumu¬

300,000 shares
($1 par) common stock. Underwriters—To he supplied
by amendment. Price—$12 a share of preferred and $7
a

share of

Proceeds—Estimated net proceeds of

common.

insurance

Casualty

Consolidated Retail Stores, Inc.

N. C.

July 9

(letter of notification)

June

($1 par)
common stock. Underwriter—R. S. Dickson & Co., Char;lotte, N. C. To be publicly offered at $3 a share. Proceeds
-go to selling stockholder (Percival Christie Baylor) who
is President of the company.
Issue subsequently with¬
20,000

Carscor Porcupine Gold Mines,

June 24 filed 400,000 shares of
writer—Registrant will supply

Ltd., of Toronto,
stock.

common

Under¬

name of an American
by post-effective amendment.
Offering—
To the public at $1 a share in Canadian
fu^ds. Proceeds
—For a variety of purposes in connection with explora¬
tion, sinking of shafts, diamond drilling and working
capital.
' '■
'■ •

underwriter

ferred for each: 12% shares of common owned.

public at $52.50 a share.
changed shares of $2.75
as

Proceeds—To

increase

working

Co., San Francisco

For. construction

(7/29)

manufacturing plant at Redwood City, and for purchase of equipment and for workT ing capital.
'■'ti.'■■■■' - '
new

v
•

Inc.,

St. Louis

June 19. filed 60,000 shares :of capital stock (par $1).
Underwriters—No underwriters.
Offering—The shares
,will; be offered ta exefctitives and key employees of
company

upon

the exercise of options for purchase of

one

share of

;

-t:

•

new

Delhi Oil Corp., Dallas, Texas May 23 filed 175,000 shares common stock (par 50tf)
Underwriters—No underwriters, Offering-—Shares will:
be offered for sale to common
stockholders of record
June 20 of Southern Union Gas Co.. which owns
all'
of the
outstanding common stock of the corporation at
$2.36 per share. Proceeds^-Proceeds will be added to
cash balances to be applied to the
payment of current or
other liabilities.
'

Corp., Muskegon, Mich.
■

Proceeds—For rearrangement and expansion of the

com-

pany's manufacturing plants, acquisition of additional
and facilities, and for additional working
capital
requirements.

tools

"vV..;

the

Cooper Tire & Rubber Co., Findlay, O. (8/6)
July 17 filed 60,000 shares ($25 par) 4%% cumulative
convertible

preferred.
Underwriters—Otis & Co. and
Co., Inc.
Offering—To the public.
Price—
$25 a share. Proceeds—Estimated net proceeds of $1,356,200 will be used to redeem its outstanding 4% deben¬
Prescott &

•

t.1

•

♦

•

Diamond T Motor Car Co.,
Chicago, 111.
March 29 filed 00,000 shares of common stock
(par $2).
Shares are being sold by certain stockholders.
Underwritere—Hallgarten & Go. ? Offering—Price based on markets
For details see issue of April 4.
•

Digest Publishing Co., Inc., Sacramento, Calif.
July 10 (letter of notification) 5,000 shares of common
stock on behalf of Phillip M.
Millspaugh, President;
Sadie A. Bunte,
Secy.-T„reas.; and Martha Effie Holmes,
Director. Olfering-^JWce $1 a share. No underwriting;
Electric;Auto-Lite Co., Toledo* Ohio

shares ($5 par) common stock.
Underwriters—Lehman Bros., and Smith, Barney & Co.
Offering—Shares initially will be offered for subscrip¬
rate

common stockholders of record
July 16 at the
of one .share for-: each four ^shares held at
$55.50

per share.
Rights expire Aug. 2.
Proceeds—Company
will use $10,000,000 of net
proceeds toward the payment

of its currentvbarikloah with
Trust Co. and;

-Tr>

'■-■

'■

*§. *>ijp:-$

Engineers Waterworks Corp.; Harrisburg, Pa.
June 24 (letter of notification)
$275,000 4 % debentures
due 1971.
Underwriters—C. C, Collings & Co.,
andj
Stroud ds Co., Inc., Philadelphia. Price, $10L Proceeds
for

purchase of additional water properties
securities and for other corporate purposes*

;;

•••

NEW YORK
PHILADELPHIA

; ALBANY
PITTSBURGH

Underwriters—E. H. Rollins & Sons, Inc.
OfferingHolders of the company's outstanding $1.50 cumulative
preferred stock, Series B, (no par), are offered the
opportunity to exchange such shares for 56,017 shares
of the 4%% preferred. Unexchanged old shares will be
called for redemption. on Oct. 1.
Proceeds—To

Offering—Prices by

retire

the

presently

Series B, at $26.50 and $27.50 a share,

respectively.

balance will be added to general funds.

(Continued

on page

388)

Distributors
*hV

Municipal—Railroad
Public Utility—Industrial Securities

•

Trustee
Direct contact with Markets in principal financial centers.

NEW YOYK 15, N. Y.

E. H. Rollins & Sons

RECTOR 2-2200

out¬

standing 37,035% shares of $1,50 cumulative preferred
stock, Series A, and 25,000 shares of the same stock;'

ONE HUNDRED TWENTY BROADWAY

INDIANAPOLIS

CHICAGO
TRENTON

their,

July 8 filed 90,000 shares of 4% % cumulative preference
stock, Series A, (par $50)—convertible to and including
Aug. 1, 1956, and 25,000 shares ($1 par) common stock.

Company

■-v'

Hemphill, Noyes C§,Co.

-Members New York Stock Exchange

Transfer Agent •; Registrar

Family Finance Corp., of Wilmington, Del.
(7/27-31)

OF NEW YORK

The remainder will he

used to replenish working capital.

Underwriters

and Municipal Securities

'hi''-'/Cv.?•

Central Hanover Ba nk; &

other; banks.

•

The Marine Midland Trust

(8/3)

June 26, filed 298,971

UNDERWRITERS—DISTRIBUTORS—DEALERS

Industrial, Public Utility, Railroad '

;

company's

amendment.

•

Un-

derwriters—No underwriters were named 'and there was ;
no indication that there would
be any.
Offering—The
shares will be offered for
subscription to present com¬
mon stockholders at the
rate of one; share for each 10
shares held. Price by amendment.
jProceeds—Proceeds,
together with other funds, will be applied as loans to

(8/5-7)

stock for each six

»■ ■■

Chicago

($20

July 8 filed 250,000 shares 4Y4% cumulative convertible
preferred stock, Series A ($50 par). Underwriters—Van
Alstyne, Noel & Co.
Offering—Price by amendment.

Clinton Industries,

Unsubscribed shares will be

(7/29)

•

Corp., San Diego, Cal.

Corp. of America,
141,496

Continental Motors

share for each share held. Unsubscribed

publicly of¬
underwriters. Price by amendment. Proceeds
—Payment of portion of the costs of construction and
improvement program.

capital,

shares will, be offered publicly at J 1.20 a share, Under•writers^-Stohe
Youngberg; Sah Francisco. Proceeds—

filed

shares held.

July 10 (letter of notification) 250,000 shares ($1 par)
*
capital stock.
Offering—Stockholders will be offered
^ the
right to subscribe for the stock at $1 a share in. the
a

$53.50

fered by

♦

ratio of 0.84 of

holders at rate of

liquidate present debt and expand operations.

Chemical Process

par) capital stock.
Underwriters—Kidder, Peabody & Co. Offering—Shares
will be offered for subscription to present capital stock¬

(letter of notification) A000 shares. ($100 par)
convertible
class
B
preferred stock
will be publicly offered at $100 a share.
No
or

preferred
ad.divional working capital.

Container
June

reduce

and for working capital.

the

unex¬

May 29 filed 77,134 shares of common stock (par $1).
Underwriters—Names by amendment. Offering—Shares
are to be issued upon the exercise of options allotted
by
the company to its officers and supervisor executives.
For derails see issue of May 30.

cumulative

underwriters.

Proceeds—To redeem

Consol. Vultee Aircraft

j fe; Central Mfg. Corp., Roanoke, Va.

which

To pay off loan and to
provide funds for costs of addi- >
tional manufacturing
space, machinery and equipment k;

tion

;May 29 filed 35,000 shares of $2 cumulative preferred
stock, series A (no par), but with a stated value of $50 a
i share, and
175,000 shares of common stock (par $1).
Underwriter—Paine. Webber, Jackson & Curtis, Chi¬
cago. Offering—The stocks will be offered to the public
at prices to be supplied by amendment.
Proceeds—To
pay off $3,000,000 loan from First National Bank Chi;cago and Harris Trust and Sayings Bank, Chicago, bal¬
ance working capital.

^Exchange
Remaining shares

will be sold to underwriters who will reoffer it to

and

-July 3

(7/19)

60,000 shares 4%% cumulative preferred
A (par $50).
Underwriter—Central Re¬

privilege and rights expire July 18.

Central Electric & Gas Co., Sioux Falls, S. D.

■

filed

public Co. (Inc.), Chicago; Stix & Co.; I. M. Simon &
Co.; G. H. Walker & Co.; Stein Bros. & Boyce; Peltason, Tenenbaum & Co., and Scherck, Richter & Co.
Offering—New preferred is offered in exchange to hold¬
ers of
company's $2.75 cumulative preferred on a share
for share basis plus a cash payment of
$1 and dividends
accruing on the $2.75 stock. Common stockholders are
offered the right to subscribe for the new stock at
$52 a share in the ratio of one share of new pre¬

Ontario

stock, series

drawn.

(letter of notification) 26,600 shares of $1 par
stock. ' Offering—Price $11.25 a share.
Underwriter—Nelson Douglass & Co., Los Angeles. Proceeds—

Gas & Electric

Burlington,

Co.,

common

three Connec.icut subsidiaries: Derby "
Co.; Wallingford Gas Light Co., and the1
Danbury and Bethel Gas and Electric Light Co.

$3,420,000 will be used for working capital.
Carolina

Davis Mfg., Inc., Wichita, Hans.

Derby Gas' & Electric Corp., New York
June 19 filed 20,066 shares (no par)* common stock.

company to operate in the State of Washington.

Fluorite.
•

•

Explor-"

ore.

•

ore.

subsidiary, balance

Offer¬

ing—Shares will be offered to the public at 75 cents a
share.
Proceeds—Net proceeds, es.imated at
$300,000,
will be used for mining
operations. Business —

to common stockholders
excludes the two
stockholders who have waived their rights to subscribe.
The remaining
90,414% shares and any shares not sub¬
scribed to by common stockholders will be offered to the

Bletdric. Co;;:rejeCied'

Rejected-Standard 'Gag

ing—Shares will be offered to public at 75 cents a share.

Underwriters—Sabiston-Hughes, Ltd., Toronto.

Bids

offering
principal

Candego Mines, Ltd., Montreal, Canada

Cyprus Mines, Ltd., Montreal, Canada ;
May 31 filed 500,000 shares of common stock (par* $1).

ing for

May 31 filed 500,000 shares of

truck tire and tubes.

subscription to present common
stockholders at $4;50 a share in the ratio of one share of
preferred for each share of common held. The

satisfactory. Blyth
CO., Inc.> and First Boston Corp.
bid of; $28.33, a.* share, and Harriman Ripley & Co; bid
of* $24.Q31 a share. Stock" will again be put up for sale
when market conditions improve.;
,

tures, due 1967, to pay certain debts and for additional
equipment, manufacturing space and working capital.
Business—Company successor to Master Tire & Rubber
Corp. by change of name. Manufactures automobile and

Harri?
man Ripley & Co,
Offerings-Stock ,1s being sold by
Standard Gas and Electric: Co., parent, of California;
June 25 two

387

Incorporated

■

WASHINGTON

40 Wall Street,
New York

Boston

New York 5, N. Y.

Philadelphia

Chicago

San Francisco

The

.»

' \'r *

■*■!i

York (7/29-31)

Inc., New York.
Offering^-To be offered publicly.
At $8.10 a unit consisting of one share of class A
stock and one "share of common stock.
Proceeds—$201,000 for retirement of 2,010 shares ($100 par) preferred

share; remaining proceeds, together with
funds, will be used for production of educational

stock at $100 a

films,

Florida

Public Utilities Co.

(7/24)
of

shares of
Underwriters—Starkweather
New York, and Clement A. Evans and Co., Inc..
Atlanta, Ga. Offering—Approximately 50,000 shares will
be offered to the public. Price by amendment. Proceeds
—Shares being registered are owned by J. L. Terry, Pres¬
ident, who will receive net proceeds. Business—Public
filed

June

common

stock

unspecified

(par

number

$3).

& Co.,

utility.

Flying Freijght Inc., New, York

May 6 filed 300,000 shares common stock (par $1). Un¬
derwriters—J, F. Reilly & Co., Inc., and Courts & Co.
Offering—Price to public $3.50 per share.
ProceedsProceeds will be used for the purchase of six land
planes, ten flying boats, reconditioning of flying boats
and working capital. Business^Compariy was incorpo¬
rated on March 9, 1946, to operate as a charter air
carrier.

Forest City

Mfg. Co., St. Louis (8/29)

filed 280,000 shares ($1 par) common stock.
Underwriters—Peltaspn, Tenenbaum Co., St. Louis. Of¬
fering—Shares will be offered publicly at $11.25 a share.
Proceeds—Net proceeds go to the selling stockholders.
June 17,

Frontier

/June 27

r*s

•

.-i" «• >

'■*

■

N'i

•'V

1,4 ix.

'V |

•,

•

* ;

Transports Co., Jacksonville, Fla.

•

are

working capital.

filed

(7/23)
'

July 8

V1*

•

1'^\ J

-5

* /*,

>'j,.

' r''.^ /-Na

1' 'v/

''l

Sidlo,
bonds

•

Heller

(Walter E.) &

Co.^

offered

employees of the company. Price—
and price to employees

Proceedsr—Estimated net proceeds'
of $600,000 will be used by the company to construct a
new plant at Oxnard, Calif., to purchase equipment and
to pay off notes.
Business—Manufacturer of dried food
will be $4.25 a share.

seasonings.

Harrisburg. Pa.

and $68,000 shares (50c par) common stock. Underwriter
—E. H. Rollins & Sons, Inc., and Stroud & Co., Inc.
Offering Price—Debentures $1,000 per unit.
The pre¬
ferred and common will be publicly sold in units con¬
sisting of 1 share of preferred and 1% shares of com¬
mon
at $12 per unit.
Proceeds—To pay the bal¬
ance of principal and accrued interest on the $673,000
note held by Fidelity-Philadelphia Trust Co., and' fees
and expenses connected with the issue.

Great Lakes

Plating Co., Chicago (7/24-25)
130,000 shares ($1 par) common stock.
Underwriters—Dempsey & Co., and Ames, Emerich &
Co, Dempsey & Co. owns the shares.
Offering—Of the
total, 115,000 shares will be sold to underwriters for
resale to the public, and 15,000 shares are to be offered
; "to certain officers, directors and key employees of the
company.
Price—Price of 115,000 shares at $7 a share.
Price of the 15,000 shares to certain employees, $6.20
June

17. filed

share.
Greens
:

'•

Ready Built Homes Inc., Rockford, III.

(8/1)

Mich.

($1 par) common stock.

Offering price estimated at $3.25 a

will be offered to

following New York

bidder: Merrill Lynch, Pierce,
Fenner & Beane; L. D. Sherman and Co.; Green & Co.;

houses and sold to highest

Batkin, Jacobs & Co.; Troster, Currie & Summers; and
Edward A. Purcell & Co.
Proceeds—To selling stock¬
holder.

—

Ltd., Toronto

June 7 filed 250,000 shares of capital stock (par 40c).
Underwriters — Names to be supplied by amendment.
Offering—Stock will be offered publicly in the U. S. at
40c a share
(Canadian money).
Proceeds—Proceeds,

$75,000, will be used in operation of the

estimated at

Business-Exploring

company.

and

developing

gold

mining properties.

Maine Poblic Service Co., Preque Isle, Me.
June

filed

150,000 shares

Underwriters—To
*

($10 par)

determined

capital stock.

through

competitive

bidding.
Probable bidders include The First Boston
Corp.; Kidder, Peabody & Co., and Blyth & Co., Inc.

(jointly); Harrimah Ripley & Co. Proceeds---The shares
being sold by Consolidated Electric and Gas Co.,
parent of Maine Public Service, ; in compliance with
geographic: integration provisions of the Public Utility
Holding Company Act.
< 4 »
are

share for share

be offered to the public.

Maryland Casualty Co., Baltimore (7/29)
May 29 filed 239,940 shares ($10 par) cumulative prior

preferred stockhold¬
basisi Unsubscribed shares will

preferred stock and 479,880 shares ($5 par) convertible

will be offered for exchange to first

fered to public.

Corp., Dallas, Texas

172,201 shares

Price by amendment.

Proceeds

preferred stock.

Underwriters—Merrill Lynch, Pierce,

Fenner & Beane; The First

Boston Corp.; Lehman Broth¬

and Paine, Webber,. Jackson & Curtis. Offering?—
Stocks initially will be offered for subscription to pres¬
ers,

writers—Blyth & Co., Inc.

$1),P:

share.

Offering—Of the total, 137,515

shares will be offered to the public and

filed

Offer-

Airplane

Klotz, President.

III.

Shillinglaw,

Underwriters—Sabiston-Hughes,. Ltd., Toronto..

Luscombe

Mada Yellowknife Gold Mines,

Underwriters—R.

Gubby Mines, Ltd., Montreal, Canada

Underwriters—Lobe and
Proceeds

July 5 (letter of notification) 5,000 share& of common
stock offered by and for the benefit of Leopold H. P.

—Refunding.

May 31 filed 500,000 shares of common stock (par

share.

Moore, Inc., and Alfred Lind, both of Seattle.
—For mine acquisition and development.

funds for use in an

350,000 shares ($1 par) common stock.
Jack & Heintz Precision Industries, Inc., Maple
H. Johnson & Co., New York, and
Heights, Ohio (7/22)
Bolger & Co., Chicago.
Offering—Price, *
$3.50 a share.
Proceeds—Net proceeds will be used ; May 31 filed 50,228 shares of cumulative preferred stock
partly for working capital and to pay for production I (par $50), 4% series (convertible prior to April 1, 1956)
equipment now being acquired by the company. .
and 550,000 shares of common stock (par $5).
Under¬
July 2

250,000 shares of nonstock (par 5 cents) to be offered to

Gottron, Russell & Co., Cleveland, ahd

Goshia &: Co., Toledo.

ers on a

common

the public at 20 cents a

shares ($50 par) cumulative pre¬
shares (no par) common stock.
Underwriters—By competitive bidding. Probable bid¬
ders include Blyth & Co., Inc. * and Mellon Securities
Corp. (jointly) and Morgan Stanley & Co. and W. E.
Hutton & Co. (jointly). Proceeds—Net proceeds from the
sale of preferred will be used to reimburse the com¬
pany's treasury for construction expenditures. Net pro¬
ceeds from the sale of common will be applied for re¬

—

(letter of notification)

assessable

June 17, filed 200,000

28, filed 309,716 shares

($10 par)

Underwriters—No underwriting.

Livingston Mines, Inc., of Seattle

ferred stock and 966,870

Underwriters

70,600 shares

3 filed

July 3

proceeds, the company expects to use about $8,079,000
for the purchase from Atlas Corp. of 84,744 shares of
common stock of Bonwit Teller & Co. and remaining

Industrial Brownhoist Corp., Bay City,
(7/23-24)

Price

class A common
Offering—Price,
$10 a share.
Proceeds—Proceeds will be used to pay
for its temporary quarters in New York, for furniture
and fixtures, equipment and other corporate purposes.

20 filed 495,700 shares ($1 par) common stock.
Underwriters—Blyth & Co., Inc., New York, heads the
underwriters.
Price by amendment.
Proceeds—Of the

June

Montgomery, Ala.

filed 225,000 shares (10 cent par) common
Underwriters—Newburger and Hano, Philadel¬

stock.

(8/5-9)

demption of 5% cumulative convertible preferred stock
not converted into common prior to the redemption
date.
The balance will be added to treasury funds.

note

Liquid Conditioning Corp. of New York
July

July- 8! filed $350,000 4%% sinking fund debentures,
33,000 shares 6% cumulative preferred stocks ($10 par)

one

The terms of offering of the

phia, and Kobbe Gearhart & Co., Inc., New York.
—$5.50 a share. Proceeds—Working capital.

June

Illinois Power Co., Decatur,

unit consisting of

Offering
will be

June 28, 1946
stock.

June

proceeds will be added to general
expansion program.
^

stock.
common

(7/29-31)

Angeles, Calif.

Inc., New York

publicly at $105

Lime Cola Co., Inc.,

Proceeds—For operation of

& Co.,

cents par) common
and 2,500 shares of

corporate purposes.

business.

(Henry)

(50

notes

remaining shares of common were not disclosed. Under¬
writers—Amos, Treat & Co., New York.
For general

Chicago (7/31)

July 10, (letter of notification) 300,000 shares of $1 par
common stock. Offering—Price $1 a share. Underwriter

Holt

and

Underwriter is Coburn

Proceeds—Will be used to extent of

and 10 shares of common.

by amendment.
Proceeds—Company will receive pro¬
ceeds from 70,000 shares of common and the 10,000 shares
of preferred.
Two stockholders will receive proceeds
from 10,000 shares of common.
Company will use its
proceeds for general working funds. Business—Lending
funds and giving financial aid to business concerns.

Pettit, Los Angeles.

Price—The

Stop order hearing

—D. D.

par)

Let's fie Publishing Corp., New York (7/19)

7,900

amendment. Offering

Herculair Products Corp., Los

S($5

stock and 20,000 common stock purchase war¬

Middlebrook.

•

filed 80,000 shares of ($2 par) common and
10,000 shares ($100 par) 4% cumulative preferred. Un¬
derwriter—F. Eberstadt & Co., Inc., New York.
Price

•

\•

50,164 shares

July 15 (letter of notification) 250 of 3-year 5% Sink¬
ing fund notes in the principal amount of $100 each and

by SEC. For details see issue of March 7.

July

■/.A/.-/;,

notification)

$40,000 to purchase machinery equipment, $100,000 to
pay remainder of issuer's debt to La Pointe Engineering
Co., and the balance for working capital.
Vr

•)

par).
Stock
acquired by selling stockholders in exchange for 432,000
shares common stock (par $3) of American Engineering
public by amendment.

Corp. of Unionviile, Conn.

-4'

10 cents each for the warrants.

Hayes Manufacturing; Corp., Gr. Rapids, Mich.

Co. Underwriters—To be named by

(8/5-9)'

Offering price, $6. a share, for the stock

rants.

Feb. 27. filed 215,000 shares of common stock ($2
Shares are being sold by certain; stockholders.

—Price to

(letter of

common

Public offering price $6 a share

La Pointe-Plascomold

100,000 shares ($1 par) common stock.
Underwriters—Van Alstyne, Noel & Co., New. York, ,ah3,
Johnston, Lemon & Co., Washington, D. Ci
Offering—
To be offered to, the public at $8 a share., Froceeds-^Company is selling 60,000 shares and stockholders are
selling 40,000 shares. The'company will use its proceeds
to pay the costs of opening additional stores ,ond to ex¬
pand merchandise in its existing stores.

4^% first mortgage bonds,

(Robert H.), Inc.,
(7/29-31)

•

Kay Jewelry Co. of Los Angeles, Calif.

100,000 shares ($1 par) common stock.
Underwriter—Ames, Emerich & Co., Chicago/ Offering
—To public at $9 a share. Proceeds—Acquisition,- etc.

Inc., Los Angeles

Hartfield Stores,
June

(letter of notification)

Graupner

(7/20J)

Kungsholm Baking Co., Inc., Chicago

Price by amendment.

being sold by the company.

Proceeds—To be added to

stock (ho par).

Inc., New York

June 27 filed

28,1946 filed 20,000 shares of 4% % ($25 par) cumu¬
lative convertible preferred stock and 33,884 shares
ditional working capital.
—
($1 par) common stock. Undrewriters—Otis & Co., Cleve¬
land, Ohio. Offering—Company is selling the preferred
•
Gentry, Incorporated, Los Angeles (8/5)
shares and stockholders are selling the common shares.
July 15 filed 210,000 shares ($1 par) capital stock.
Price—$25 a share of preferred. Price for the common
Underwriter—Lester & Co., Los Angeles,
Offering—
by amendment. Proceeds—Net proceeds will be added
Of.the total,, the company is selling 120,000 shares to the / to general funds.
underwriters and George E. Clausen, President, is sell¬
Hoving Corp., New York (7/22-26)
ing 90,000 shares of which 60,000 will be sold to under¬

Janet's Apparel Shops,

July 10 (letter of notification) 2,000 shares ($100 p^r)
class A preferred; 1,000 shares ($1 par) class B preferred;
and 20,000 shares ($1 par) common. No public offering.
The shares will be sold only to persons affiliated with
the company.
For establishing two jewelry stores in
Los Angeles.

authorized but unissued and

maining 25,000 V2 shares are

Co., Detroit

writers and 30,000 to

Thursday, July 18,-1946

Plywood Corp. of Hoquiam, Wash.
June 27 filed 131,235 shares of common stock (no par).
Underwriters—First California Co. and 12 associates.
Offering—Metropolitan Industries Co. owns 106,234V2
of the shares which are issued and outstanding, and
will receive entire proceeds from their sale.
The re¬

10,000 shares of com¬
Underwriter—Crouse & Co., Detroit.
Offering price—$15 a share.
Proceeds—To provide adJuly

mon

Harbor

<•''.''

Gabriel Steel

•

'* ' '

ration.

Proceeds—Working capital.
^ '

i '

shares of common stock (par $1).
Offering—Stock is being of¬
shareholders at $3 per share. Holders
of approximately 200,000 shares have agreed to waive
their preemptive rights. ,
■>
f

preferred-stock will be offered to the public, but
the common stock initially will be offered for subscrip¬
tion to present stockholders at $11 a share at the rate
of 12 shares for each 100 shares held.
Unsubscribed
shares of common will be offered publicly.
Price—
The bonds will be sold at $101; preferred at $100 a share,
and unsubscribed shares of common at $11 a share.
11

*, <

fered to present

and

v', /

Underwriters—Blair & Co.

Gulf Atlantic

1951; 3,500 shares ($100 par) 5% cumulative pre¬
ferred stock and 15,000 shares ($1 par) common. Under¬

v •>,"

Jan. 17 filed 270,000

due

writers—Peters, Writer & Christensen, Inc., and
Simons, Roberts & Co., Denver.
Offering—The

July 12 (letter of notification) 30,000 shares (100 par)
common and 30,000 shares ($5 par) preferred.
Offering
Price—$10 a unit.
Consisting of one share of common
and one share of preferred.
Underwriting — Allan N.
Young & Co., Inc.; Philadelphia. For purchase of all of
the outstanding stock of Janet's, Inc., a California corpo¬

Refining Co., Denver, Colo. (7/18-19)

filed $100,000 Of

ore.

shares ($5 par) class A stock and
100,000 shares (10 cent par) common stock. Each share
of class A stock is initially convertible into 2 shares of
common stock.
Underwriters—Herrick, Waddell & Co.,

June 25, filed 100,000

other

lng—Shares will be offered to public at 75 cents a share.
Proceeds—Net proceeds, estimated at $300,000, will be
used for; mining operatipns.
Business—Exploring for

(Continued from page 387)

»'

FINANCIAL CHRONICLE

THE COMMERCIAL &

Films Inc., New

Offering—Stocks will be of¬

Price by amendment.

be added to working

capital.

Proceeds—Will

ent common

lative
one

stockholders in ratio of

one

share of

cumu¬

preferred for each 3% shares of common held arid

share of convertible preferred for each 1% shares of

common

held.

Subscription price by amendment.

Pro¬

ceeds—Net proceeds will be used to pay entire indebt¬
edness of

Maryland Holding Co., Inc.,

subsidiary, to

wholly owned

Reconstruction Finance Corp.

4
/

;Yolume -16#

Nnmbet'4508

THE

itlsi

? \ r

Mathews Conveyor Co. of Ell wood City,

COMMERCIAL'« TINANCIAL CHRONICtE

July
shares ($1 par) common stock;
Underwriter—Singer, Deane & Scribner.
Offering—
30,000 are authorized but unissued shares and will be
sold for company's account; balance of 10,000 shares
are being sold by certain stockholders who will receive
the entire proceeds.
Price by amendment Proceeds—
j
Company will use the proceeds from the sale of its
30,000 shares for increasing plant capacity,

Manufacturing Co., Los Angeles

offered

Shops, Inc

Hoving Corp.

Conveyor Co.,

Common
—Common

—:—

Newport Electric Corp—
Nugents National Stores, Inc
Oberman & Co.-

■

Preferred
—Common

—Preferred and Common

Pal Blade Co., Inc.
Rich's Inc.
-

—Capital Stock
.——Preferred

———

———Capital Stock

July 30, 1946

Com. and Preferred

S. & W. Fine Foods, Inc..—.—

Armour & Co.—
—Preferred and Common
Ben-Hur Products, Inc...
——^—Debentures
Heller (Walter E.) & Co.—Common and Preferred
Midwest Packaging & Materials Co.—Pfd. & Com.

—Common

Industries, Inc._Pfd. & Com.
—Debentures

—

Sporting Goods, Inc.--—.-Preferred

and Common

Sullivan-Waldron Products Co

Capital Stock

Reporter Publications Inc..-——.—.—Common
Spiegel Inc,
/———
-Common
United States Plywood Corp.
Preferred
——.

Arkansas West. Gas Co.i—

i.—.—Common'

La Pointe-Plascomold

July 1 (letter of notification) $300,000 15-year serial de¬
bentures.
To be publicly offered at $1,000 a unit.
Un¬
derwriter—First Trust Co., of Lincoln, Neb. 'Proceeds—
To retire outstanding debentures, betterments to plant
and for additional machinery and equipment.

Greens

Corp

Common '

Augusts, 1946

Preferred

Associated Spring Corp,..
Container Corp. of America
Gentry Inc, 1T——..r...L—

Michigan Gas & Elec. Co., Ashland, Wis.
July 24, 1946

stock and

120,000 shares ($10 par) common stock.
Un¬
derwriters—To be determined by competitive bidding.
Probable bidders include Blyth & Co., Inc.; Kidder, Peabody & Co.; The First Boston Corp.; Harris, Hall & Co.
(Inc.); Merrill Lynch, Pierce, Fenner & Beane, and Ira
Haupt & Co. Offering—New preferred will be offered
on a
share for share exchange basis to holders of its
outstanding 7% prior lien, $6 no-par prior lien, 6%
preferred and $6 (no par) preferred.
Of the common
stock being registered, company is selling 40,000 shares,
Middle West is selling 57,226 shares and Halsey, Stuart
& Co. Inc., New York, is selling 22,774 shares.
Proceeds
—Michigan will use net proceeds from bonds to redeem

Electric Auto Lite Co..———.—..Common

(EDST)—Bonds

Florida Public Utilities Co
Great Lakes Plating Co

Common
Common

Admiral

Bates

Mfg. Co
....—Preferred J
Cooper Tire & Rubber Co.—j.——Preferred

—Common

Common

Preferred and Common

Continental Motors Corp

Abbott Laboratories

Class A and Common

Forest

City Mfg. Co
Graupner (Robert H.), Inc.

—Common

Sunray Oil Cbrp^iu..4iilbebentures and Common

Common

Maryland Casualty Co

Preferred

Common

August 25, 1946

Debs. Pref. & Common

Lime Cola Co

August 14, 1946

-Preferred

Films Inc.

$3,500,000 3%% series A first mortgage bonds, due 1972,
at 106.75 and interest.
Net proceeds from sale of com¬
mon and from shares of new preferred not issued in ex¬
change will be used to redeem $375,000 V-k% serial de¬
bentures, due 1951, at 101.2 and interest.
It also will

August 8,

Common

Corp.
Cladmetals

A'-'d/•

August 6, 1946
Street & Smith Publications Inc.———Common

Corp

Butler's Inc.

—Common J

-Preferred and Common

July 29, 1946

American

—Common

Paper Co.-

Pep Boys—Manny, Moe 8c Jack
Common
Weetamoe Corp.
Preferred and Common

July 27, 1946

Electric

Capital Stock

Kungsholm Baking Co..
NekooSa-Edwards

National Alfalfa Dehydr. & Mill. Co.-Pfd. & Com.

Acme

/Common

...

—Capital Stock'
Holt (Henry) & CO., Inc.—-Preferred and Common

July 26, 1946

Family Finance Corp

Debentures'

August 3, 1946

Equip. Trust Certificates

Corp

-Common/

Capital Stock

Common

Class A and Common '

Rochester Telephone Co. 11 a.m.
United Cigar-Whelan Stores

—Common

—

Common

Pennsylvania RR.

June 24 filed $3,500,000 of series A first mortgage bonds,
due 1976; 14,000 shares ($100 par) cumulative preferred

Ready Built Homes Inc.Michigan Steel Casting Co.——Sardik Food Products Corp.
Sun Ray Drug Co.—

——Common

Menasco Mfg. Co
National Airlines Inc
Neville Island Glass Co

...

August 1, 1946

Black Hills Pwr. & Lt. Co.--Preferred and
Common
Brooklyn Union Gas Co., 11:30 a.m. EDST—Pfd.

stockholders

Preferred

July 31, 1946

Preferred

•_

Industrial Brownhoist
Corp

accrued dividends

■M

,1'}

Newmarket Mfg. Co.————,

July 23, 1946

Messenger Corp.. Auburn, Ind.

105 and

Mathews
and Common

———

Jack & Heintz Precision
Wek Sales Co.-

filed

July 22, 1946

who are selling the shares.

redeem

.\|

-Atlas Imperial Diesel
Engine Co

129,000 shares ($1 par) common stock.
Underwriters—Stone and Webster Securities Corp. Of¬
fering—To be offered to the public. -Price by amend¬
=

July 20, 1946
Janet's Apparel

public

Proceeds—Net proceeds go to three

Chemical Process Co

Meredith Publishing Co., Des Moines (7/18-19)

ment.

Consolidated Retail Stores, Inc..Preferred
Let's Go Publishing Corp
Notes and Common

by under¬
writers at not less than $4.75 nor more than $10.
Proceeds—To repay unsecured bank loans; to pay first
Instalment on purchase of plant from RFC; balance to
be added to working capital.

June 25

Common

,■■.1946

July 1 in ratio of two new shares for each five shares
held at $4 per share.
Rights expire July 22.
Un¬
subscribed

Meredith Publishing Co.—

'May 17 filed 370,000 shares of common stock. Under»writers—Sutro & Co., and G. Brashears & Co.
Offer¬
ing—Stock is being offered to shareholders of record
*

vr*

(Showing probable date of offering)

(7/23)

■

New Issue Calendar

July 18, 1946
Frontier Refining Co
Bonds Pfd.

Menasco

vfVr '')*

Pa.

(7/29)
10 tiled .40,000

■

Taylor-Graves Inc.
*

U. S.

all unexchanged

Preferred and Common/

Spring & Bumper Co

—Pfd. and Common

shares of prior lien and preferred stocks.

Michigan Steel Casting Co., Detroit
June

filed

100,000

($1

par)

(8/1-6)

common

Underwriters—Cray, McFawn & Co., Detroit.

stock.

Offering—

To be offered publicly at $8.25 a share. Proceeds—Pur¬
chase additional facilities,
expansion, etc.

Midwest Packaging Materials Co., St. Louis
>; (7/3D
July 12 filed 15,000 shares ($10 par)' 5% cumulative,

Montgomery Ward & Co.,

of record

preferred stock and 85,000 shares ($1 par)
Underwriter—Edward D. Jones & Co.,
St. Louis.
Offering—The 15,000 shares of preferred and
30,000 shares of common will be offered publicly, and
the remaining shares of common are reserved for

;

stock.

pur¬

chase under assignable warrants exercisable

until Aug.
1, 1951. Price—Public offering price preferred $10 per
share; common $5 per share, Proceeds^-Net proceeds
will be used to purchase all
outstanding common stock
of Midwest Wax Paper Co. and to increase
general funds.

Business—Company

organized July 1, 1946, for the
purpose of acquiring all the outstanding common capital
stock

was

Mountain States Power Co.,

Modern Development Co.,

July 8 (letter of notification) 1,500 shares cumulative
r

convertible preferred stock (par $100); 150,000 shares
class A non-voting common stock
(par 1 cent) 4 and
30,000 shares of class B voting common stock (par 1 cent).
Underwriters—Robert H. Malcolm, Earl M. Turner and
Frederick M. Harris, all of New York. Offering—To be
offered in
class A

units of

common

one

and

share of

proven worth in

Co.

Montgomery Construction Co.,

Hatboro;

and

Smith

which

July 5 (letter of notification) 100,000 shares of class A
stock (par $1).
Securities will be offered through reg¬

are

owned

ceeds will go to Standard

Murphy Chair Co.,
21

filed

136,877

Underwriters—The

Bankers

Postponed indefinitely.

($1

Bond

Webster

National Cellulose Corp., Syracuse, N. Y.
May 31 filed 200,000 shares of common stock (par $1)
to

warrants

purchase

will be sold

Co., Inc., Louisville,

common.

Offering—Stock
The warrant!

the basis of one warrant for

shares of common purchased.

each 10

Proceeds-^-Estimated net

proceeds of $1,020,000 will be used to pay off $61,000 of
loans, to purchase plant and equipment at an estimated
cost of $751,620 and the/balance as additional working

stock.

common

20,000

will be offered to public at $6 a share.

capital.

Ky.

par)

Securitiesf

,■$■& ■

National Dairy
June 27 filed

Products Corp., N. Y.

300,600 shares of

common stock.

Under¬

writers—No underwriters.

Price, $5.25

served for issuance

to key employees

and its subsidiaries.

Proceeds—To be added to working

share.

Proceeds—Of the net proceeds to

the company, amounting to
its

treasury

$147,711, it will

use

$65,000

make further expenditures

Offering—The stock is

capital.

formerly used xby its

a new

chair, plant

dissolved subsidiary, Murphy
Box Co., and for machinery and equipment for the
plant.
It will

apply $35,000 for construction of
as

warehouse

working capital.

common

Underwriter—Smith, Barney & Co.

amend¬

Proceeds—Redemption of outstanding 4%%
a

share plus dividends.

Airlines, Inc., Miami, Fla.

28,1946 filed 150,000 shares ($1 par)

amendment.

pre¬

Indefinitely

postponed.
National

Brothers.

Proceeds—Net

Business—Air transportation.

new

derwriters—Loewi

& Co.,

common

Milwaukee, Wis.

stock.

Offering—Price

held.

stockholders at rate of

stock.

Ua«*

Offering-^-

Price by amendment.
used to

Douglas DC-6 airplanes.

share for each foupr

public.

Proceeds—Net proceeds will be

purchase additional inventory equipment and to

increase working funds.
ous

one new

Unsubscribed shares will be offered to the

Business—Production of vari¬

types of writing, wrapping and industrial papers.
Neville Island Glass Co., Inc.^

(7/23)

common

proceeds, with other funds,

.working capital.

be used to purchase

Port Edwards» /

(8/5)

July 16 filed 63,000 shares ($25 par)

mon

stock (par $1),

Price by

Wis.

Paper Co.,

Sharek^ initially will be offered ior subscription to com¬

Co., McKeesport, Pa.

June 13 filed 250,000 shares of

ferred stock at $109

Nekoosa-Edwards

now

and the remaining proceeds

Murphy ~(G. C.)

•

re¬

of the company

in the rehabilitation and expansion of

will

Offering—Shares,

Owensboro,

materials and labor, purchase of additional
ground and
,

Underwriters--Stone

Ky., and Cruttenden & Co., Chicago, heads underwriters..

Underwriters—Lehman

Proceeds—For construction equipment, building

Gas.

sylvania, New Jersey and New York.

per

(jointly); Harriman,

pro¬

June'

Price, $3

Co.

by Standard Gas & Electric Co. and

istered brokers and dealers in States of
Delaware, Penn¬
share*

constitute 56.39% of the company's outstanding
common,
will be sold at competitive bidding.
Proceeds—Net

ment.

Pa.

Barney

Co., Inc.; Kuhn, Loeb

Ripley & Co.; The First Boston Corp.

preferred, 100 shares

California, Arizona and Nevada.

(no par).

par).

with

shares of clas.s B common at
$101.20 per unit. Proceeds—Proceeds will be used to ac¬
quire leases and 'Options upon mining properties of

stock

($1

Corp,, end Boswortk C!hanute Loughridge & Co. Price
^amendment/■} Pi^ceeds-~-Shares :afe /outstanding and
arb being' sold by? stbckholders.s 1
^

Underwriters—Floyd D. Cerf Co., Inc.

to reimburse

New- York

Albany, Ore.

common

June 28 filed 28,960 shares of 41/&% cumulative
preferred
stock ($100 par) and
212,200 shares of common stock

Underwriters—To be determined by competitive bidding.

June
•

140,614 shares of

Alfalfa Dehydrating & Milling Co.,
Lamar, Colo. ( 7/26)

Probable bidders include Blyth &

products.

Mississippi Investment Corp., Keokuk, Iowa
July 13 (letter of notification) $25,000 each of class A
preferred stock and common stock. Offering Price—
$100 a share. No underwriting. To increase capital.

June 6 filed

Midwest Wax Paper Co., which manufactures

wax paper

National

July 18, at the rate of one share for each
four shares held. Rights expire Aug. 13. Price---$50 a
share. Proceeds—Net proceeds, estimated at
$64,876,2281
will be added to the company's general
4esources#-^8

convertible
common

Inc., Chicago

June 24, filed 1,304,286 shares (no par) common stock.
Underwriters—No underwriters.
Offering—The stock
will be offered for subscription to common stockholders

Pittsburgh (7/23)"

June 3 filed 60,000 shares of class A stock

60,000 shares of common stock (par 10c).
~Amott, Baker & Co., Inc.;
and Buckley Brothers,

(par $1) and

Underwriters

Herrick, Waddell & Co.,

Offering—Stocks will be offered

(Continued

on page

390)

•

(Continued from page 889)

to the public in units of one share of class

KTarrim&n Ripley & CO.
issue the 100,000 shares

A and One

tion of

common

for equipment:

Working capital.
•

New

Corp., White, Weld&Co.-Kidder,Peabody & Co. (jointly).
Offering—Bonds and common stock are being offered in
connection with a
compromise recapitalization plan

Pal Blade Co., Inc.,

•

holders.

vr„

i„

'r-1 V*

)• *'

'i
r-'*

Reynolds Pen Co., Chicago

>»■ j

•

■:

■

„

common stock (no par),
being sold by company and
Underwriters—Names' by
amendment.
Reported Allen & Co., probable under¬
writer.
Offering—Terms by amendment.
Proceeds^.
Net proceeds to the company will be added to working

;..f

Public utility holding company.

funds.

Mass.

july 8',

Peabody & Co.

operates

Underwriters—-Stone & Webster Securities

ferred stock.

Offering—Shares initially will be offered for Sub¬
scription to common stockholders in ratio of 0.13 shares of
\ preferred for each share of common held. Unsubscribed
shares will be offered to public through the underwrit¬
ers.
Price—By amendment, Proceeds—Refunding.
Corp.

•/

•

,V/

•&

,nS?■

V*'.;

2^1946 filed 50,000 shares of 4%% cumulative pre($100 par). Underwriters—Scott and Strihgfellov^ Richmond, Va.
Offering — New preferred will

(8/5)

offend in exchange for shares of the company's outstan<|ing 6% preferred, on a share for share basis. Such

I Nofog Corp., Reno, Nev.

holders also will receive a $5 cash payment and accrued
dividends on the old preferred.
It is expected that im4

total, 160,000 shares will be offered publicly and 40,000
shares will be offered to company employees.
Prices—

sub^cr)Sed shares will be sold to underwriters for public
]
offering. Price, by amendment.

The stock to be sold to the

public will be offered at $7.50
a Share.
The price to employees will be $6.85 a share.
Proceeds
Proceeds go to two selling stockholders,
Maurice L. Strauss, President, and Emanuel Rosenfeld,
Vice-President and Treasurer.
Business— Operates

Rochester (N. Y.) Telephone Co. (7/23)

Jun,e^26

—

chain of 44 retail stores for automobile

by competitive bidding.

parts and acces¬

guar|j$eed

Northern States Power Co., Minneapolis, Minn.

Pettibone Mulliken Corp., Chicago

share.

filed

cumulative preferred
stock.
Underwriters—To be determined by competitive
bidding.
Probable bidders Include Lehman Brothers,
and Riter & Co. (jointly); Dillon, Read & Co. Inc., and
Smith, Barney & Co. Offering-~Holders of company's
$5 series cumulative preferred stock will be offered the
right to exchange their shares for new preferred On a
share for share basis plus a cash adjustment.
Shares
of new preferred not issued in exchange will be sold
to underwriters.
Price to be determined by competitive
bidding. Proceeds—Net proceeds will be used to redeem
unexchanged shares of old preferred at $110 a share.
275,000

Co., Hoboken, N. J.

arrt

&^^4#a.m. (EDST)

Northwestern Glass

Co., Seattle, Wash.

(letter of notification) 40,056 shares of no par
common.
Offering—Price $3.50 a share. No underwrit¬
ing.
For plant improvements and additional working
capital.

July 9

Northwestern Public Service

June 28 filed

Co., Huron, S. D.

Portland

(Ore.)

par) cumulative preferred stock,
of $3 par common. Underwriters—
by competitive bidding.
Probable
.bidders include Halsey, Stuart &. Co. Inc. (bonds); Harriman Ripley & Co., Inc.; Lee Higginson Corp.; A. G.
Becker & Co., Inc., and Harris, Hall & Co, (Inc.).
Offer*
ing—Securities will be sold at competitive bidding.,
Proceeds—Refunding.
26,000

filed

85,000 shares ($1 par) common stock.
Underwriters—Newburger & Hano, and Kobbe, Gearhart
& Co., Inc.
Price, $6.75 a share.
Proceeds—Net pro¬
ceeds to the company, estimated at $350,200, will be ap¬
plied as follows: About $111,300 for retirement of butstanding preferred stock: $41,649 to purchase 100% of
the stock of two affiliates, and balance $197,000 for; other
corporate purposes.
Oberman & Co.,

June

Jefferson City, Mo.

(7/29-31)

filed

convertible

80,000 shares ($10 par) 5% cumulative;
preferred stock and 75,000 shares ($1 par)

common stock.

Underwriters—Herrick, Waddell & Co.,;

Inc., New York, principal underwriter. Offering—To be
Price, $10 a share for preferred and.
$6-a share for common.
Proceeds—Of the $1,055,000

offered publicly.

estimated net proceeds, the company will use approxi¬
mately $189,000 to retire its 1,890 shares of $6 cumula¬
tive preferred stock and about $300,250 to retire mort¬
gage notes.
The balance will be used for general cor¬
porate purposes.
'

Co. of Ann Arbor,

Inc., Porterville, Calif.
J^SS^'IO (letter of notification) 100,000 shares of stocki

eral funds.

'/'/

No underwriting. For In-*
staJfation of a mill and further development of mining

Pr0fetiesSardik

Mich.

670,000 shares of

common

stock (par $1).

of 1,329,020 shares of common of RKO

(approxi¬
mately 35%) on May 31, is selling 650,000 shares of the
total offering and will receive
proceeds from these
owner

shares. The balance of 20,000 shares are to be purchased
from the company by underwriters through the acqui¬
sition and exercise of option rights granted two company

officials.

The company will receive $160,000

exercise of the option

Working capital. '
•

Ranchaven

from the

rights which will be added to
'
■
,

Industries

Inc., Glenwood Springs,

Colo.

July 11 (letter of notification) 500 shares ($100 par),
capital stock. Offering—Price, $100 a share. No under¬
writing. For road building and^other equipment and for
payment of rents, real estate and other ^expenses.
♦

Pacific Power & Light

Co;, Portland, Ore.

Blyth & Co., Inc., White, Weld & Co. and Smith, Barney &
Co. (jointly); The First Boston Corp., W. C. Langley & Co.;

Reiter»Foster Oil Corp., New

York

June 27 (letter of notification) 54,600 shares
par common

stock.

Offering—Price,- $1

derwriter—The Federal

Working capital.

Corp., N. Y.

bf 50 cents
share. " Un¬

Proceeds

—

For

(8/1)'

Corp., New York

Proceeds—Working capital, purchase equips
For details see issue of May 30.

holder^;

ment and plant, etc.

Underwriters—Lehman Brothers and Goldman, Sachs &
Co.
Price—By amendment.
Proceeds—Atlas
Corp.,

Products

Underwriter—George F. Breen, New York. Offering—
StqcM will be offered to public at $16 a share with un¬
derwriters receiving a commission of $2 a share. Of th^
total being offered company is selling 155,000 shares and
the -remaining 20,000 shares are being sold by two stock*

be deposited with gen¬

...

Food

jl^psar filed I7$,000^^ Shares of ^ (^ital stock

offices in the economy

Radio-Keith-Orpheum Corp., New York
June 18 filed

St. Elmo Mining; Co.,

OTOring—Price $1 a share.

July 5 filed 75,000 shares 5% cumulative convertible
preferred stock ($10 par).
Underwriter—Van Alstyne,
Noel & Co. and associates.
Price by amendment.
Pro¬
ceeds—Of the net proceeds, $250,000 will be used to pay
3% notes held by National Bank of Detroit, $75,000 to
reimburse treasury for sums spent in acquisition of the
electrical division plant of the company, $30,000 for con¬
struction of space for executive
baler plant, and the balance will

'■

•m?

•

Scherck, Richter & Co.; Weeden & Co.; Allen & Co., and
Rauscher, Pierce & Co. Proceeds—To complete payment
of purchase price for the capital stock of Portland Trac¬
tion Co. and the properties of the Interurban Railway
Division of Portland Electric Power Co., working capital,
etc. Offering prices by amendment.
Precision Parts

otterpA

Price by amendment. Proceeds — For redtfiSption of unexchanged - shares of 5% preferred "at
$54,50 a share and for working capital. Business—Proc®ing and distribution of food products.
,

Segal Lock & Hardware Co., Inc., New York (1
738,950 shares of common (par $1). Un¬
derwriters—Floyd D. Cerf & Co. Offering—-Holders Of
common stock, 7% preferred stock and $2.50 cumulative
preferred stock of record June 13 are given right to
March 30 filed

subscribe at $4 £er- share to new common shares et a
rate of one share of common for each two shares of any:
stock held.

Purchase

Rights expire at .3 p.m. July 2. Proceedsadditional machinery and equipment for

modernization of present
issue of

facilities/ etc.

For details see

April 4.

New York

Solar Manufacturing Corp.,

of $1.12% cumulative con-]
Vertible preferred stock, series A (par $20).
Under*
writers—Van Alstyne, Noel & Co. Price by amendment;
Proceeds—Net proceeds will be applied for the redemp¬
tion of outstanding series A convertible preferred stock
which are not converted into common stock. Silch pro¬
ceeds also will be used for additional manufacturing
facilities in the amount of $600,000; for additional inven¬
tory amounting to $400,000, and for additional working
capital.
,., .
.
•
.'
. •
June

14 filed 80,000 shares

•

July 10 filed 100,000 shares ($100 par) preferred stock.
Underwriters—By amendment. Probable bidders include

July 23.

publicly.

due
(par

an additional 128,750 common shares for con¬
version of debentures. Underwriters—First California Co.;

($100

Nugent's National Stores, Inc., N. Y. (7/29-31)
June

53,5 ,Mai? St"' Rochester. N- Y-' «P

T&red stock. Shares not issued in. exchange will be

Transit Co.

June 14 filed $1,250,000 4% convertible debentures
June 1, 1966, and 200,000 shares of common stock

$5,275,000 first mortgage bonds, due 1976;

and 110,000 shares
To be determined

The price

May 9 filed a $7,000,000 15-year 4% debentures due—
April l, 1961, and $1,242,300 20-year 5%% cumulative- fs^S and W Fine Foods, Inc., San Francisco (7/30)]
tocome debentures due Jan
1, 1964.
Underwrite!®-- j^n fiIed 40i000 shares ($50 par) 4% cumulative preBlair & Co., Inc.
Offering
Price to public by amend-,
®«ed stock, convertible series.
Underwriters—Blyth &
ment.
promissory notes
notes aggre
aggre■
Proceeds—Payment of promissory
jnc>
—=—
m_ be offered
^—j on a share
.1
i
^
Conine.
Offering—To
for
share
gating $8,000,000. For details see issue of May 16.
£3&ehange basis for 10,400 shares of convertible 5% pre-

$1); also
•

jpflgey, Stuart & Co. Inc. last April 30 for Halsey's

withal premium of $32,000. Under the agreement com¬
pany agreed to register the bonds, and to offer the bonds
nfllTir-~r-+^-"~ sale. Proceeds—Refunding. Bids Invited
for the purchase of the bonds will be received at

buildings, machinery and fixtures and for additional

Pittston

Of-

w^sJL.QO plus interest from April 1 to April 30, together

inventories.

premium of $32,000.

were issued and sold by the company

owaa&ccount and not for public distribution.

(letter of notification) 12,000 shares ($20 par)
stock.
To be offered to the public at $25 a
No underwriters.
Proceeds—For improvements

June' 28

Halsey, Stuart & Co. Inc., has

a bid of par plus

fer/iL^T-Bonds

July 2
capital
to

filed $6,238,000 of 2 ¥2% first mortgage bonds,
Underwriters—To be determined

serie&^A, due 1981.

sories.

July 10 (letter of notification) 100,000 shares of $1 par
common.
Offering—Price $1 a share. Underwriting—
Milton A. Nevraumont and Clarence B. Jacobs, both of
Reno.
For construction of pilot plant, fog clearing units
and for carrying on general business.

fered stock

Kobbe, Gearhart & Co., Inc., New York. Offering—Of the
:

repre-

July

Moe & lack, Philadelphia

Pep Boys—Manny,

Business—Company

department store in Atlanta, Ga., and

RiYerside and Dan River Cotton Mills, IncJ./
^Danville, Va. (7/22)

—

;

Underwriter—Kidderi

Proceeds—To finance increased inven-r

sentsjp£usiness originally founded in 1867.

July 16 filed 200,000 shares ($1 par) common stock. Un¬
derwriters
Newburger & Hano, Philadelphia, and

Newport (R. I.) Electric Corp. <7/29)
$une 25, filed 7,732 shares ($100 par) cumulative pre¬

(7/29-31)

torief^knd accounts receivable.

funds.

Inc.

Dividend rate by amendment.

Offering price—$14 a share. Proceeds—For the
development of corporation purposes.
•

amendment., Broceeds-AVorking capital/
Rich's,

Corp.

be applied to the prepayment in full of the
company's first mortgage note payable to Commercial
/Factors Corp., balance will be added to general corpo¬

Manufacturing Co., San Francisco, Calif,
filed 200,000 shares ($1 par) common stockl

July JO filed 35,000 shares of cumulative preferred stock.

000 will

rate

Underwriters—Blyth & Co., Inc. Offering—Company
through the under¬
write*^ and 70,000 shares to Bethlehem Steel Co. Price-

•

filed 85,000 shares ($2.50 par) common
Underwriters—Lee iHigginson Corp. Offering—Price by
amendment. Proceeds—Estimated net receipts of $1,165,-

capital.

stockholders.

will sell 130,000 shares to the public

People's Service Corp./ of 'Philadelphia
j' Jtily 5 (letter of notification) $50,000 par amount ($10
stock.
par)
common
stock.
Underwriter^—People's Service

(7/29)

June 26/1946

unspecified number of shares ($2.50
par) capital stock, issuable upon exercise of stock pur¬
chase warrants. Underwriters—No undeiwritiiig. Qffer«i
Ing—For issuance on exercise of stock purchase war4
rants.
Price: The stock purchase warrants evidence the
right to purchase capital stock of the company at $18 a
share to Dec. 30,1947. Proceeds—To be added to general
filed

300,000

Rheem

Pan American Airways Corp., Wilmington, Del.
21

> ' t>\

May 4 filed 400,660 shares of

■

•u\,u iv • v

•

of which 100,000 shares are

being sold by 10 stocks

vj'v'Jv

.>>•; i.

Offering—Price $3.50 a share.
Proceeds—The
sold by stockholders who will, receive

is being

proceeds.v

Business-

New Yoric

Shares are Outstanding and are

June

Manufacturing Co., Lowell,

stock

28, 1946 filed 232,500 shares ($1 par) capital stock.
Underwriters — F. Eberstadt & Co., Inc.
Offering —

approved by the SEC, on June 24, 1946, which among
other things provides for the elimination of all out¬
standing debentures and preferred and common stocks,
and for the issuance of $22,500,000 of bonds and 2,300,000
bf new common shares. Price by amendement. Proceeds
*—To retire outstanding securities, aggregating $34,998,500.
Bidding—Expected week of Aug. 5.
Business—

Newmarket

& Co.

June

Reporter Publications, Inc., New York <7/31,)

July; ;12 filed 150,000 shares common stock (par $0c)»
Underwriters—Newburger & Hano, and Kobbe, Gearhart

In connection with the merger, the. outstanding preferred
stocks of Pacific and Northwestern will be exchanged

ing price—To be supplied by amendment.
Public utility company.
^ ;

Cambridge, Mass.

($5 par).
Underwriters—By amendment.
Bidders may include Halsey, Stuart •& Co. Inc. (bonds
Only), Bear, Stearns & Co. (stock only), First Boston

•

share for share, with cash adjustments, for the new pre¬
ferred stock of Pacific, the surviving corporation. Offer¬

England Gas and Electric Association,

July 11 filed $22,500,000 20-year collateral trust sinking
/ fund Series A bonds, and a maximum of 1,568,080 com¬
mon'

proposes

of new preferred for the pur¬

outstanding preferred shares of Pacific and the 47,806
preferred shares of Northern Electric Co., in connection
with the proposed merger of Northwestern into Pacific.

Neville Island (near Pittsburgh) and
Any" Remaining proceeds will go into

plant

Offering—Gompany

of refinancing at a lower dividend rate the 67,009

pose

$10.10 a unit. Proceeds—Net pro¬
ceeds/together with $700,000 to be realized from the
Sale of series A and B bonds, will be used for construc¬
fchare of

Thursday, July 18,1946

THE COMMERCIAL & FINANCIAL CHRONICLE

390

Kans.

Southwest Merchandise Mart, Inc.,

Wichita,«
*

/
:

July 1 (letter of notification) 99,900 shares of common
stock to be offered to the public at $3 a share. Under-

Volume 164

Number 4508

iTHE COMMERCIAL & FINANCIAL' CHRONICLE

writers—Clayton Securities Corp., Boston; Estes, Snyder
Co., Inc., Topeka, Kans., and Sills, Minton & Co., Chi¬
cago.
Proceeds—To rehabilitate buildings reconverted
from war production, and for business expansion.

•

Tiemann Hardware & Supply

June 19 filed

Co., St. Louis

a maximum of 829,580 shares of common
(par $2). Underwriters—Glore, Forgan# & Co^;
Chicago. Offering—Common stpckholders of record July
12 are given the right to subscribe to the new stock at

8.Town land Country Gas Co., inc., of Richmond,

the;rate.of %th rof a share.for each share held at
$22. :per ; share. : Eights expire July 30, > .Proceed^—

July 5

stock

$3,050,000 to

Va.

balance, working capital.
•

\ r

* \/

'' v'-'

V-

!
.

propane gas business,
tion and sale.

(.7/22) ' ;
^Uly 10 J^ptter of notification) ?25,000 shares of 55-cent
cumulative convertible preferred stock and 10,000 shares
common stock.
Underwriter—R. H. Johnson & Co.,
New York;
Offering prices-r$10 a share for the pre¬

Trailmobile Co.,

ferred and

State

Street Exchange,

Boston, Mass.

Trane Co.,

aold^tcfc^ihder^ter&

^Price tb stockholders * $27;50 A

shareah&prk^oUnderwriters; $26.50 a^share^^receecls

(r-Company

wiU pay $225,000 to the two banks holdinjg
fty mortgages and the balance will be-retained for neces¬

sary repairs

to its real estate.

Steep Rock iron Mines Ltd., Ontario, Can.

Proceeds—Net proceeds -will toe added to

general^und&; and /will;'4tei; availaW'
corporate*^
For details see issue of April s.
•

Stonehenge Corp., Denver, Colo.

July 11

(letter of notification) .775 shares

common

stock. Offering—Price $100 a share. No under¬

($100

par)

writing. • For construction of* a building; purchase of
-equipment and supplies; for working capital and other
general corporate purposes.
;•

•

/;•' .*[

-J

Street & Smith

/>'

♦

of textiles.

stock.

•>
Under¬

writers—Glore, Forgan & Co.

Offering—The offering
^represents a part of the holdings of the present stocklln^ew^ Business—Is one of the oldest publishing houses
in the field, the
company and its predecessors having
been engaged in the business under the name of
Street

& Smith since 1855. *
•

Sullivan-Waldron Products Co., Seattle (7/22)
.July 10 (letter of notification) 149,000 shares of $1 par
common capital stock.
Offering—Price $2 a share. Un¬
derwriter—F. H. Roller & Co., Inc. Proceeds—For
gen¬

and

working capital.

June 25, filed

Underwriters—No

underwriters* Offering—The stock will toe offered for si&iiiondment^;/\Probable'ibMders:Jhclude:|derriU»Xiync^;^'jsubscriptioir ;tor holders of capital stock of Transwestern .Pierce,-Tenner & Beane; White,; Weld = & :Co.; Glore,
Oil Co. at rale of one share bf Transwestern Royalty
Forgan St Co., and; Harriman Ripley;& Co.«(jointly);
^ock for each 19 shares of Transwestern Oil stock held. /The Wiacoxtsid^Co.i and Dillon, Jlead/& Co. Proceeds^
part
of the shares are to toe sold by Middle West Corp.,
'Price-i-$12 a share.
Proceeds—$750,000 to repay a
bank loan; balance for working
top holding company Of the System, and part by prdcapital.
/^ence stockholder^ of; Nortto West^^ Utilities Co., parent;
United Cigar-Whelan Stores Corp., N. Y. (7/23)
of Wisconsin/^who elect to sell ^uch shares of Wisconsin
common .which will be
distributed ta .them upon tho
May 14 filed 50,000 shares of convertible preferred stock.
-

Sun Ray Drug
Co., Philadelphia (8/1)
July 3 filed $2,000,000 of 15-year debentures. Coupon
rate by amendment.
Underwriters—Eastman, Dillon &
Co;
Offering—Underwriters propose to offer the deben-

.tures^iu part directly to the public ,and the balance to
'certain dealers (including the
underwriters) at the pub¬
lic offering price.
Price by amendment. Proceeds—To
pay

outstanding indebtedness; for additional working
capital, and $358,000 to purchase the assets of Media
Drug Stores, Inc., in Philadelphia, Norristown, Upper
Darby, Lansdowne, Wayne, and Media, Pa.

Wlters—Ailen & Co. Offering—Prior preferred atock*
holders were given privilege of exchanging such shares
for shares/tofidew^ convertible preferred
of four shares of prior preferred for one share of con¬

•

July 11. i Convertible preferred not issued under the

ex¬

change offer will be sold to underwriters and offered
to public at $100 per share.
For details see issue of
May 19.

redeem 13,824 shares of cumula¬
stock, Series A, and 9,412 shares of cumu¬

Proceeds—To

lative preferred stock, Series B, at redemption prices
of $106 and $105.50 a share, respectively.
Balance to
be added to treasury cash.
Business—Engaged in the

plywood, fabricated airplane parts,
plywood, and other laminated
and related products.
molded

fabricated metal-covered

York

($50 par) 4%% cumulative
and 80,000 shares ($1 par)

Underwriters—Dean Witter & Co.

stock.

Sunray Oil Corp., Tulsa, Okla. (7/25)
$20,000,000 20-year debentures, due 1966,

June 24 filed

1,000,000 shares ($1 par)

common stock*

Under-

Offering—

.To be offered to the public. Price, by amendment. Prof«eeds—Company will use $25,500,000 of the net proceeds
.to retire 255,000 shares of 4^4% cumulative series A
preferred stock at ,$100:■ a share and $13,029,250 to re.deem $12,350,000 of 15-year 3%% sinking fund debentures, due 1959, at 105%. The remaining proceeds will
Jae; used to reimburse its treasury for expenditures to
.too made in redemption of its 4%% preferred on
July 17
at $41.50 a share
plus accrued dividends.

Concrete Corp.,

stock (par

$1).

per

Taylor-Graves, Inc., Saybrook, Conn. (7/25)
\July J2; (letter of notification) 44,300 shares of ($5 par)
cumulative convertible preferred stock and 44,300 shares
common stock

(par 50c).

^preferred and 75 cents
Amos Treat & Co.

Offering—Price $6 a share for,
share for

common.

Underwriter

Proceeds—For payment of notes,

mortgages and for general corporate

purposes.

Engineering and Manufacturing Co., Inc.,

Dallas, Texas

vJuly 15 (letter: of notification) 31,250 shares of no par
common.
Offering Price—$8.50* a share. No underwrit¬

share.

bidding.

to certain dealers,

be included, at the

public offering price, less certain concessions.

Price .toy

amendment.
Proceeds—It is presently anticipated that
$437,500 will be used to acquire the capital stock of Wil**

liams Stores, Inc., and
ance

,J$

will

applied

Levitt Millinery Co.
to

general

corporate

The bal¬
purposes.

Virginia-Red Lake Mines, Ltd.

competitive

include Halsey, Stuart

Proceeds—Refunding."

; •:

6 % preferred stock and 2,000 shares

($1 * par) common

Offering—Price $1 a preferred share and $25 a
common share.
No underwriting^ Tqj? ®6d|tional work-

[stock.
;

jing capital.

■.[,

■

Young Radiator Co., RacinO, Wis.

|Jan. 29 fUed 100,000 shares

of common stock (par $1);

ialso registered 40,000 shares of common for issuance upon
exercise of warrants.
Underwriters—Van Alstyne, Noel
& Co,

Offering—Price to public $8.25 per share.

share prior to Feb. 1, 1951, 20,000 were

Burnside

Co.,

Offering—Offering price to public 28 cents

United States funds.

For details

see

40,000 warrants to purchase common stock at $8.25 per
holders

New York,

Young Corp., New York;

Canadian).

Offering

Price—To be determined by competitive

June 24 filed 220,000 shares of capital stock (par $1—

Underwriters—Willis

bid¬

& Co.

July 11 (letter of notification) 200,000 shares ($1 par)

Underwriters—Newburger

may

determined by

Shields & Co., and White, Weld & Co. (joint¬

—To the public.

Kobbe, Urearhart & Co., Inc., and D. Gleich Co.

whom any underwriter

& Beane and Kidder, Peabody & Co. (jointly).

ex¬

Offering—Underwriters propose to offer the shares in

ly); W. C. Langley & Co.; Merrill Lynch, Pierce, Fenner

among

Light & Power Co., Mt.

1946 filed $9,000,000 of debentures, due 1976.

& Co., Inc.;

Virginia Bare Stores Corp., New York
par).

Proceeds

issue of May 9.

Ripley & Co., and Union Securities Corp. (jointly); Blyth

Proceeds

July 3 filed 90,000 shares of 5% cumulative convertibie

see

Inc.; Morgan Stanley & Co.; Lehman Bros., Harrimaii

common

standing stock and liquidation of its liabilities; to

($10

For details

ding. Probable bidders

♦

June 28,

Concrete, Inc., by retiring remaining out¬

preferred stock,

Offering—Price by amendment.

Underwriters—To

pand and develop patents, and for working capital.

& Hano;

Interest rate by

Stuart & Co., Inc.

Vernon, N. Y.

purchase additional equipment; to acquire assets

of Vacuum

Probable bidders

include Halsey,

Yonkers Electric

Philadelphia

Price to public, $11

Will be sold at competitive bidding.

—Refunding,

(automobile leaf springs, bumpers, and fender guards.

—To

(Pa.) County Gas Co.

amendment.

Price—By amendment.
Proceeds—Company will use $950,000 of net proceeds to
retire long term bank loans; $750,000 to retire short term
loans; about $400,000 for machinery and equipment; any
remaining to working capital.
Business—Manufacture

•-part to the public and the balance
•

Of¬

fering—To be offered publicly.

Vacuum

Kansas City, Kan.

May 8 filed $1,700,000 first mortgage bonds, due 1976.

(7/25)

June 24, filed 30,000 shares
convertible preferred stock
common

Inc.,

public in units consisting of one $200 debenture and
two shares of common at $210 a unit.
Proceeds—Pro¬
ceeds, together with a loan, will be used for purchasing
a site and
constructing, furnishing and equipping a
modern hotel of not less than 230 rooms. It is estimated
the total cost will be $1,600,000.

manufacture and sale of Douglas fir plywood, hardwood

plywood,

Palestine

June 10 filed $1,000,000 of 30-year 3/4% income deben¬
tures, due 1976, and 10,000 shares common stock (no
par)v Underwriters—No underwriting.
The securities
will be offered to the public through a campaign di¬
rected by the Chamber of Commerce of Kansas City,
Kans.
Offering—The securities will be offered to the

July % 1 filed 60,000 shares of cumulative preferred stock,
Series A ;($100 par).
Dividend rate toy amendment.
Underwriter—Eastman, Dillon & Co. Price by amend¬
tive preferred

Bank, Ltd., Tel Aviv,

Wyandotte Hotel Co.,

United States Plywood Corp., New York (7/31)

ment.

Workers

Co.

July 3 filed certificates of deposit representing term de¬
posits of not less than five years bearing 5%. tq 6% in¬
terest, to Ampal American Palestine Trading' Corp, in
amount of $500,000; also certificates of deposit represent¬
ing 10-year4 term deposits with interest at 6% to aggre¬
gate $750,000. Proceeds for advances to cooperatives;/

vertible preferred with, a cash adjustment on or before

May 28 (letter of notification) 25,000 shares of

Texas

dissolution of North West Utilities

Cumulative dividend, $3.50 per annum (par $100). Under-

Angeles

Wisconsin Power & Light Co., Madison, Wis.

United States Spring & Bumper Co., Los

ijwrlters are headed toyEastman,Dillons/Co.

(7/22)

May 21 filed 550,000 shares ($10 par) common stock to
be
sold
at
competitive
v Underwriter?—By
bidding,

-75,000 shares- <$10 par) capital stock and

subscription warrants for the stock,
:

Wek Sales Co., New York

(letter of notification) $249,000 of debenture
bonds paying 4% interest a year. Due in 15 years.
Of¬
fering Price—Smallest unit $500. No underwriting. For
carrying on business of company.

Transwestern Royalty Co.*San Antonio, Tex.

eral funds.

.•

•

Jiily

improvements, etc;, redemption of 6% preferred stock

♦
common

organization expenses, and about $1,100,000 Jqr working
capital. Business—Thd company intends to carry on the
business of the old company which is the manufacture

Publications, Inc. (8/6)

July 17 filed 197,500 shares of

Cincinnati, Ohio

March 27 filed 500,000 shares of capital stock
(par $1).
-.Underwriters—Otis & Co. Offering—Price to public by

amendment,

representing the proceeds from the sale of 50,000 shares
convertible stock to the underwriters and 525,000
shares of convertible stock to Textron, Inc., at $4 a share,
will be used as follows:
approximately $13,000,000 for
payment of a portion of the purchase price of the assets
-totoe acquired from the old company, about $100,000 for
of

June 20 filed 59,505 shares of common stock (par $2) of
shares filed 45,905 are being sold on behalf of company
and 13,600 on behalf of three stockholders. Underwriter
-^Cruttenden & Co.
Proceeds—For plant additions,

July 1, 1946 filed $1,750,000 second mortgage 4% nonIcumnlative -income bonds, due 1961. Underwriters-*
Roger W. Babson, Wellesley Hills, Mass., and Charles F.
Ayer. Offering — Company will issue $750,000 of the
toonds to two banks which hold two first mortgages on
all of the company's real estate and the remaining $!,*
€90,000. at the -bonds will be ^offered ta -the company's
stockholders in the ratio of one bond for; each jinit of
3% shares .of stockheld.Unsubscribed shares wRlttoe

other assets of Nashua* Manufacturing Co. which was
Incorporated Int 1823. t :Thenew: eompany jwas; Organized
instance of Textron, Inc., and is wholly-owned
subsidiary, Textron" Mills, Inc., which are promoters of
the new company. Net proceeds, together with $2,300,000

including manufacture, distribu¬

La Crosse, Wis.

pre-,

•at the

Underwriters—Stifel, Nicolaus & Co., Inc., and A. G. Ed¬
wards, & Sons, Offering price by amendment. ProceedsNet proceeds go to (toe Columbia Terminals Co.

a share for the common^ .Proceeds---Td
subsidiary for purchase of building occur
•pied by issuer, payment of bank loan, and for increased
working capital.
a

Offering—The

effective date of registration) was incorporated June 27,
1946 to acquire the operating properties and certain

June 28,1946 filed 25,000 shares ($5 par) common stock.

$4.75

toe loaned to

fil 11

//[/-IP®

(8/5)

one share of preferred and one-half share of convertible.
Price by amendment. Proceeds—Weetamoe Corp. (Name
to be changed to Nashua Manufacturing
prior to

common

■;

Sporting Goods, inc., Springfield, Mass.

well, Marshall & Co., Los Angeles.

(letter of notification) 3,000 shares of Class A
($1 par) and $25,000 5% income notes, due
Aug. 1, 1966. No underwriters.
Offering—Price $3 a
share for the common. The notes will not be ofunif orm
amount but will be sold for full principal amount stated
on face of each particular note.. Proceeds—For the pur¬
pose of enabling corporation to establish and operate a

pay

Weetamoe Corp., Nashua, N. H.

ferred and convertible stocks will be offered in units of

capital.

off short-term bank loans; $1,400,000
to acquire all of the capital, stock of a - corporation own¬
ing and operating a large homerfurnishing store; $750,000
to-pay the annual instalment oh its 2%% serial notes;
'4r'rv''V

•

July 15 filed 200,000 shares ($25 par) $1.20 cumulative
pfd. stock, 100,000 shares of ($1 par) convertible stock
and 650,000 shares ($1 par) common stock. Underwriters
5~Blair^
Reynolds & Ce;,:NeW^;York and Maxi;

July 10 (letter of notification) 1,000 shares of Class A
stock (pary $100)*
No underwriters. Offering price—
$100 a share. Proceeds—To provide additional working

Spiegel, Inc., Chicago (7/3f J

■

For additional working capital and to retire bank

ing.

391

issue of Aug. 2,1945,

recapitalization and 20,000

.underwriters at

10 cents per

postponed indefinitely.

issue to stock¬

are

being sold to

warrant share. Offering
For details see issue of Feb. 7.

Thursday, July 18,1946

THE COMMERCIAL & FINANCIAL CHRONICLE

£92

Prospective Security Offerings
w

(NOT YET IN REGISTRATION)

Mr'
:>Avi

INDICATES ADDITIONS SINCE PREVIOUS ISSUE
1

Civil!. Aeronautical

uvn2T.CI unaulilcU

Board

uucuu

recommendations

aypiuvw
approves

stock, with B. G. Cantor, &

;tag
over the New York City ^tropolitatf area^
"Chester

;MarW
^ stock
shares;

\,
'I T>

*•[

;*■<•

? \\ ,i 1 i VJ i

'V '»

W/i

**•, 5»j-t

Allis-Chalmers Manufacturing Co.

Aiig. 24 stockholders will vote

creating an issue of
$100),

500,000 shares of convertible preferred stock (par
of which it is proposed^to offer 359,373 shares to

holders at rate of

stock¬

preferred for each seven common

one

It is expected that the dividend rate will be 3 Y8 %

|ield.

.fef!

..American Bosch Corp.

April 10 .reported that Alien Property Custodian may

Hh^rtly ask for ■ bids on 535,000 shares (77.24%); of the
stock of the corporation;
Probable bidders include
Glore, Forgan & Co. and Lehman Brothers (jointly),
and Blyth & Co., Inc., and Merrill Lynch, Pierce, Fenner

& Beane

(jointly).

.American BrakeShoe Co., New

■My 18

tlolding. Company Act.

Probable bidders include Mellon

Securities Corp.; The First Boston

Inc.; Harriman, Ripley & Co.

York

•

^ .w

Unless present plans

changed common stockholders will be entitled to
subscribe for additional shares of common stock at $35

are

per share on the basis of one additional share for each
,fou£ shares held.
The proposed record date' for the
^determination of common stockholders entitled to re¬

ceive rights is Sept. 11 and they will have approximately

'^0 ,daysf rom Sept. 20 in which to exercise their sub¬
scription rights.
>*' i
?;
*
;

Clay Forging Co. a
i
July 14 stockholders voted a $275,000 bond issue to fi¬
nance an expansion program at the Tiffin, O., plant and
to build a new one in Tyler* Tex.
- '
American

Artloom Corp.,

Philadelphia *stockholders voted to increase authorized
300,000 shares to 600,000 shares (no
par). Company proposes to offer to stockholders, with¬
out underwriting, one share pf new stock at $10 a share
for each two shares held, requiring the issuance pf 148,-

'July

common stock from

:633 additional shares.
ing

Atlantic Refining Co., Philadelphia

10 company (name to be changed to Minneapolis

Gas Co.), under modified plan approved
common

stock.

■'*'^1*

Brown

Probable bidders include

White, Weld & Co., W* C. Langley & Co., Otis & Co.

•;

oyo^yvyyy.,'

■

American

■

,'v •; " V- •"

Overseas Airlines,

Inc.
July 17, in connection with 3-for-l split-up of X ,000,000
shares of capital stock voted on July 11, it is stated
that the split-up is for the purpose of broadening the
market for the corporation's stock and thus facilitate
the issue

and sale of additional

shares within the next

few months to provide funds to meet, enlarged capital
requirements. Probable underwriters, if new financing
is, undertaken, include Emanuel Deetjen & Co., and
jLehman Brothers.

United States

Government,

State, Municipal

was

programs may then crystallize, the Baltimore & Ohio
named as a leading prospect* now that all barriers

is
to

consummation of its $500,000,000 debt adjustment
plan have been eliminated.
Other portions of the debt
now thought to be attractive possibilities for a refinanc¬
ing operation besides the $76,900,000 of first niortgage
the

and the $67,800,000 first mortgage 5s.; There are
$37,200,000 of Southwestern Division 5% bonds, $36,800,000 Pittsburgh, Lake Erie & Western 4s, and $10,000,000
Toledo-Cincinnati Division mortgage scries A 4s. Prob¬
able bidders, if refunding operations crystallize, are
Kuhri, Loeb & Co., and; Halsey, Stuart & Co. Inc.
4s

April 16 stockholders authorized new mortgage.
Com¬
pany contemplates refinancing one-third of outstanding
funded debt (Dec. 31, 1945, $12,665,000) through sale of
equal amount of bonds under new mortgage# through
competitive bidding.
Probable bidders include Harri¬
man,
Ripley & Co., Inc.; Lee Higginson Corp., and
Halsey, Stuart & Co. Inc.

Bangor Hydro-Electric Co.
June

stockholders

plans to retire 21,799
through exchange for new
Under tentative plans, call date will be

4% preferred,
Oct. 1,next,
^

of plant

Bjlair 6- Co.

•

issue of 14,750

approved

stock.

•

Boston

•

Carolina

Co. Inc.

••-I-.'.,—

IT",

Bigeiow, and

work¬

Distillers Corp.,

Louisville, Ky.

shares of 4% preferred stock for which
be exchanged, on a share-

Power & Light Co.,

Light Co. (parent)

**-

;

in com¬
bidders
Read &

replacement of the author¬
shares ($50 par) $2.25 preferred
stock with an equal number of new no-par $2 preferred
stock whh a stated value of $50.
Initially it is planned

ized but unissued 50,000

be issued.
additional 175,000 shares ($1
par) common stock of which there are now outstanding
797,600 shares.
Proceeds of the preferred'and common
stock sales are to be used to repay a $3,000,000 bank
loan and to augment working capital.that

35,000

shares of the latter stock will

Company plans to issue an

Southwest Corp.

Central & South West Utilities Co.
Service Co. approved by the SEC
sufficient number of shares of Central & Southwest

and American Public
a

be sold at competitive
otherwise supplied, to
retire outstanding preferred stocks of Central and
American.
Possible bidders:
Glore, Forgan & Co.;
Lehman Brothers-Larard Freres & Co. (jointly); Smith,
Barney & Co.-Harriman, Ripley & Co. (jointly); Blyth
& Co., Inc.; Stone & Webster Securities Corp, and First
Boston Corp. (jointly).
.
Corp., the new company, would
bidding to provide funds, not

Chicago

Century Manufacturing & Instrument Co.
May 29 reported Estes, Snyder & Co., may underwrite
offering of common stock following merger of Century
and Continental Geophysical Service Co.

Penn Mutual Life Insurance

Co., a long term loan of $1,500,000 from the First National Bank, Chicago, and $5,000,000 in a shortrterm loan from .the Union Securities
Co., New York. To retire the short term loan the com¬
pany, it is said Will issue preferred arid common shares
to be sold publicly through a syndicate headed by Paul
H. Davis & Co., Chicago and Stroud & Co., Philadelphia.

Chesapeake & Ohio Ry.
s.
probably one of the early devel¬
opments when and if the merger of Chesapeake & Ohio
Ry. and the Pere* Marquetle Ry. is approved will be
a refunding operation to take in the debt of both roads.
C. & O., it is expected, will take steps to refinance the
refunding and improvement 3%s, due in 1996, of which
$37,500,000 series D and $27,600,000 series E were out¬
standing at the1 close of 1945. The Pere Marquette has
outstanding $59,749,000 first mortgage 3%s, series D,
due in 1980. At the ICC hearings in April on the merger
proposal, W. H. Wenneman stated that refinancing of
the Pere Marquette issue would be undertaken promptly/
following consummation of the merger.
,

First California Company
INCORPORATED

& Pacific RR.
lower-coupon first
mortgage bonds, proceeds from the sale of which would
be used to redeem first mortgage 4%
bonds. 1994,
is expected to be postponed until late this year. Earlier
plans 'were for the retirement of the bonds July 1.
Three investment banking groups were set up to enter
competition for any new offering, viz.: Kuhn, Loeb &
{Co.; Mellon Securities Corp., and Halsey, Stuart & Co.,
Chicago Milwaukee St. Paul
by the road of $58,900,000

Offices

California and Nevada
1

June 18 reported that

Inc.

J' ,7."

June 11 stockholders voted

July 15 ownership of the Boston Store changed hands
formally when a syndicate headed by Edgar L. Schnadig,
Chicago, purchased all of the capital stock of the operat¬
ing company, the Boston Store of Chicago, Inc., and cer¬
tain real estate rights for $14,000,000.
Funds for the
purchase, in addition to the syndicate's own; money,
were furnished
by a secured loan of $3,500,000 from

Head Office: Sin Francisco

Pursuant to plan of

CLEVELAND

6T. LOUIS

Central Electric & Gas Co.

plans the sale of 909,350 shares of common stock
pliance with Holding Company Act. Probable
include Kidder, Peabody & Co., and Dillon,

Birmingham is a subsidiary of Na¬

Our Sixteen

Carolina, Clinchfield & Ohio Ry.
it was reported that a refunding of the $21,-

Light Co.

Store,

400,000 first mortgage 4% series A bonds of 1965 is seen
as a possibility.
Probable bidders include Kidder, Peabody & Co.; Halsey, Stuart & Co. Inc.

the company's proposal to
its certificate of incorporation, subject to stock-

common

June 26

tional Power &

the present $5 preferred can
for-share basis.

hplder approval, to grant to its common stockholders
preemptive rights in connection with the sale of any
new

(par $1), after which a 100% stock dividend will be de¬
clared; Directors also seek approval of art additional

13 the SEC approved

amend

'"V'r

Brown-Forman

Birmingham Electric Co.

July

July 23 stockholders will vote on a plan which calls for
increase in common stock from 300,000 shares to 600,000

(James B.)

Serve

PITTSBURGH

facilities when practicable and to increase

Issuance

PHILADELPHIA

55,177 shares will be offered to acquire the outstanding
capital stock of three smaller companies. The company
will receive
approximately $3,000,000 in cash which
it will use for the purpose of financing an expansion

Distilling Co.
^
n !
June 30 reported company planning some new financing
with F. S. Yantis & Co., Chicago as probable underwriter.
Beam

and

CHICAGO

July 12 reported Nation Power &

Bangor & Aroostook RR., Bangor, Me.

Underwriters and Distributors

BUFFALO

holders, including the heirs of the late Mr.

Corporate Securities

BOSTON

Bigeiow, St. Paul, Minn.

Central

! ' American Locomotive Co., New York
Aug; 6 shareholders will vote on a proposal to redeem
$20,000,000 outstanding 7 % preferred stock.
The plan
calls for issuance of $10,000,000 of prior preferred and
$10,000,000 of convertible second preferred with an over¬
all dividend rate not exceeding 4Y4%.
The plan would
provide that each $100 par value share of convertible
second preferred stock will be convertible into not more
than 2 2/9 shares of common stock, or a total of not
more than 222,223 shares of common stock.
Probable
underwriters include Union Securities Corp.; Blyth &
Co., Inc.; Eastman, Dillon & Co., and The First Boston
Corp.
•fyv.f 1;

July 17 early registration covering the; proposed offers
ing of $3,500,00 4^% cumulative preferred stock and
427,558 shares ($1 par) "common stock, expected. The
shares to be offered are subject to approval by stock¬
holders of the proposed financing, including a 3-for-I
split-up of the presently outstanding common stock.
Proceeds will be used for expansion purposes. Negotia¬
tions between the company and certain- stockholders and
Reynolds & Co., investment bankers, have been com¬
pleted Holders of approximately $1,908,000 outstand*
ing 6% cumulative preferred stock will be offered right
to exchange their shares for the new 4Yj% preferred.
Of the 427,558 shares of new common to be offered, 67,500 shares will be sold by the company and 304,881 shares
are to be offered for the account of certain selling stock¬

!w'

reported that one effect of the railroad
freight rate adjustment is expected to be a stimulation
of bond refundings. Among the roads whose refinancing

June 22 it

by. SEC, reserves

right to make public offering of nrit fh excess of 87f4,078
new

shares of 6% preferred stock

American Gas & Power Co.

shares of

Corp.; Blyth & Co.,
' T
^

May ,7 stockholders approved proposal to increase the
company's indebtedness from time to time by additional
amounts not in excess of $50,000,000 in aggregate. The
purpose of the plan, it was said, is to place the company
in a position to fund bank loans, add to working capital
and to provide funds for capital expenditures. Probable
underwriters include Smith, Barney & Co.

Proceeds will be added to work¬

capital.|fo||^g -•V'":*y

'April

ing capital.

is planning to offer 199,101 additional
shares of common stock about, Sept. 20.
Proceeds from
*this4 issue are to be used principally to finance the com¬

company

pany's. plant, expansion program.

Sfii

•

^Baltimore & Ohio RR.
•

Ark

•
Atlantic City Electric Co.
July 9 the offering of 1,150,000 shares of common stock
;(now owned by American Gas & Electric Co., parent)
seems probable in the fall, in compliance with the Utility

and the offering price will be $100 per share.; Blyth &
Co., Inc., will be uderwriter.

•

Arkansas Power & Lieht Co.. Little Rock

common
(par $12.50) arid $5,QOO,O0O iri
promissory notes, for "purpose of paying current promis¬
sory notes and finance expansion program.
Probable
bidders include Dillon, Read & Co. Inc.; The First Bos¬
ton Corp.,-and Blyth & Co., Inc.

April 23 stockholder^ voted'to issoe ari additional 450,000 7
i-shares; of' common;; stock when;' an4 C it mew^capital
needed.
Probable underwriters;: Hincks; Bro.. & ~ Co.J
Stone & Webster Securities Corp.; Hornhlower & Weeks.

;inade by two of, its examiners Qf company's plan .to esitibjish .an 'extensive airplane commuting Service: radiafc-!

^i'^Air Express International Agency, Inc.
July 17 reported company planning the issuance of com¬
mon stock.
Newburger & Hano probable underwriters.
•;vi-":->iv •'k'>'-h'j*-i!.*-Is./

Bridgeport (Conn.) Brass Co.

July 10 (letter of notification) expected to be filed at
early date for* 60,000 shares<of; convertible preferred
,„uu -r,
r*
p
Ccl as underwriter.
% -!

County, New Jersey,' Staten" Island, Tiring Island
;i»ndtConnecticut. .
*Np
■'

•

Progressive Health- Insur. Co.f N. Y.

American

Air Commuting,7; lnc*<

• '*

*July l:16 ipdssibfli^

jVplunie 164
•

THE COMMERCIAL & FINANCIAL
CHRONICLE

Number 4508

Cities: Service•• Co.,

New York

| :|

IJ >of .New Mexico. The merged company would have 524,••
July 17 it is suggested that when and if the outstandr
.|fciar^^ ($7, par)^ common stockrnil. iiel^,by , Federal,
ing debt is retired through proceeds of its utility equities,. :uqw,
owi^ all
'that preferred stockholders might be offered, a new 4%<.
®J; V
^
^
f
t?x!?
res^in£ *rom
"preferred
in
exchange
for
the
old,
Issues,
ihithe.'amohftt
the.
vv\
.1
^erge^equals
the number of Federal common,.<^ares
.outstanding.
Public offering of stock
of Call
^

underwriters include; Merrill Lynch,
Pierce, Fenner &
Beane; Otis & Co.; and the First Boston Corp.
*

Indianapolis (Ind.) Power & Light Co.
April '24 it oWas reportedthat
company probably wilt

prices plus: arrears (approximately $113;486,250).

Citizens Utilities Co- ,June 26 reported that present
..

./V'/",

'"T

expected.
Probable bidders include E. H. Rollins. &
Sons; • Rauscher,
' Pierce Sc Co., Inc. Blyth & Co., Inc.;. The First Boston
Corp.; Otis & Co., and Harriman Ripley & Co.

plans call for interim
borrowing from banks to effect the redemption on or
about Sept. 1 of $4,208,000 5*6% bonds and for the sub¬
sequent issuance Of a like amount of hew lower interest
bearing
bonds.
'
/1
fa.

•'*

Feltman & Curme Shoe Stores, Inc.
July 17* the merger of the Utah subsidiary of Feltman & Curme Shoe
Stores, Inc., into the parent com¬

new

pany has

writer.

International Dress Coa
June 26 it

been approved by stockholders at a special
meeting in Chicago. Holders also voted-to replace the
company's $7 cumulative preferred stock, of which 13,465

City Stores Co., Philadelphia

replace its $32,000,000 first 3V4s due
May 1, 1970, with
new lower-cost securities.
Probable underwriters In¬
clude Lehman Brothers;
Blyth & Co., Inc., and Halsey.
Stuart & Co. Inc.
i

•

'
July 8 negotiations are under way for refunding the
funded debt of the company ($5,984,000) on a long-term;
basis at a substantially lower interest rate, but no agreeihent has been made.
Probable underwriter, if through
public sale, Lehman Brothers.
#

are

outstanding, with

a new

sidiary,

wholly

the

parent -firm,

will

Probable

bidders include:

$10).

Glore, Forgan

Consolidated Edison Co. of New York, Inc., •
July 3 company formally submitted to the .New York
Public Service Commission its plan to issue
$2^0,000,000
bf new mortgage bonds as part of a plan to redeem
$304,240,000 of callable mortgage bonds and debentures
and $15,869,000 of non-callable mortgage bonds due in
1948 and 1949—-a total of $320,109,000 of long-term debt.
The $290,000,000 of new mortgage bonds would' be sold
by bidding in three separate issues in rapid succession,
the first two to be $100,000,000 each and the third for
$90,000,000. After issuing the first series the company
would then call its $179,240,000 of callable, mortgage
bonds and obtain discharge of mortgages covering $15,869,000 of non-callable bonds.
In another part of the
plan the company proposes to refinance the outstanding
2,188,890 shares of $5 cumulative preferred stock.. Prob¬
able bidders include Morgan Stanley & Co.; Halsey*
Stuart & Co. Inc. (bonds only), and Blyth & Co., Inc.
Consumers Power Co., Jackson, Mich.
June 18 company requested the SEC to approve" the
disposal of a sufficient number of common shares at
competitive bidding to raise $20,000,000. Probable bid¬
ders include Morgan Stanley & Co.; Lehman
Brothers;
Shields & Co.; Harriman Ripley & Co., and Mellon Se¬

curities Corp.

Consumers, a subsidiary of the Commonwealth
Southern Corp., also proposes to increase the common
from 2,000,000 to 6,000,000 shares and to issue 3,623,432
new common

shares to its parent for the 1,811,716 how

held by Commonwealth. :

000,000

of 5% convertible preferred stock which will be offered
in exchange on a share-for-share basis for 7%
preferred
stock. All the 7% stock which is not exchanged will be
redeemed

July 1 at $105.
'

mon.

Crawford

Each share of

./■

new

stock

half shares of

com¬

■*

„

which it is entitled and has agreed to purchase at,
$40
.per share apy new stock, not ^subscribed fbr
by stock¬
holders.
•
Fresh Dry Foods Incs*

;

Columbia, S. C. ' v
registration statement covering 650,Expected to be
Co., New York, as
principal underwriters. Public offering price about $5

May 29 reported

it was reported that The First Boston Corp.
may underwrite the offering of preferred and common

per

share.

•

General Bronze

Drug Co.
considering a plan to retire the 24,328
shares of 7% ($25 par) preferred stock.
company is

consider

refinancing of $65,000,000 3^s and 4s. Probable bidders
include: Mellon Securities
Corp., First Boston Corp.,
Dillon, Head & Co. Inc., Coffin & Burr, Halsey, Stuart
& Co., Inc., and Spencer Trask & Co.
•

El Canada Columbia Mine Co.
July 16 the Massachusetts Department of Public Utilities
took under advisement,
following a hearing, the petition
of company which seeks
permission to sell in Massa¬
chusetts 50,000 shares of capital stock at
$1 a share. The
Department also took under advisement the company's
application for registration as a broker corporation to
sell the stock and of A. O.

Alden/ the company's Presi¬
dent, for registration as^a salesman for the mining ton-

Engineering & Research Corp.

June 14 reported
company, manufacturer of air coupes,
contemplates the issuance of 300,000 shares of common
stock, with Hemphill, Noyes & Co. as underwriters.
Federal Light & Traction Co.
An application proposing the
merger of four New MexIco subsidiaries of Federal has been filed
with the SEC.
Under the plan, New Mexico

Power

Co.,

Las

Vegas

Light & Power Co.
querque's

and Deming Ice & Electric
Co., would
Albuquerque Gas & Electric Co. Albu¬

name would be

changed to Public Service Co.

was

reported that company may in near future
$38,000,000 bonds and 40,000 shares

stock, with securities carrying lower

Grand Union Co.

May 23 reported directors giving careful consideration
to a splitup of common shares and issuance of additional
stock, but it is likely that

no action will be taken
The management, it is said, is now
making an exhaustive budget study to determine what
additional capital will be needed to finance an
expansion
-

Gulf States

Utilities Co.

May 24 in connection with plan of dissolution of Engin¬
Public

Service Co. part one of the plan calls for
of common stocks of two
subsidiaries,

reclassification

Gulf States Utilities Co. and El Paso Electric
Co., and for
distribution to Engineers common stockholders.

their

Gulf

States

Utilities

stock

would

distributed

through issuance of rights.

Highway Safety Appliances, Inc.

coupon

ahd dividend rates.
Probable bidders include
Halseft
Stuart & Co. Inc. (bonds
only); The First Boston Corp.;
Melloii Securities Corp.;
Harriman, Ripley & Co.
•

Kimberly-Clark Corp., Neenah, Ohio
Aug. 9 stockholders will consider an increase
in common and the- issuance of a
new preferred
issue, the
latter to consist of
125,000 shares, to be subordinate to
the present i 4%%
preferred.
Probable

Underwriters;

it any new pref erred
issued, Lehman Brothers, and
Wisconsin Co..
t
.

•

Kingdom of the Netherlands
was stated that the
forthcoming
to be floated by the
Netherlands Goverrim^t
the American market
by a syndicate of

bond
in

ThV

July 11 it

writers.

The

Manufacturing Co., Chicago

refund its
outstanding
of preferred

Telephone Corp., New York

Goldring Merchandising Co.
May 28 reported prospective financing being discussed
with Merrill Lynch, Pierce, Fenner &
Beane, as under¬

Kansas City Power &
Light Co.

July 9 it

April 17 stockholders approved amendment to certifi¬
cate of incorporation modifying restrictions
against in¬
curring debt for capital purposes without specific stock¬
holders' approval.
Stockholders also approved amend-,
ment to authorize 175,000 additional preferred shares.
Probable bidders include Paine, Webber, Jackson &

eers

Jensen

$50,000;0db

issue

banking houses headed by Kuhn, Loeb & Co.

General

number

& Co.

new

bidding. $20,-

bonds and such

may be necessary to enable

.July 16 reported company plans early
registrationf Of
148,000 shares of common
stock, with Doyle, O'Connor
& Co., as probable
underwriter.
;

preferred at a dividend rate
not exceeding 4^% with
provision \for conversion into
common for the first five
years at approximately $30
a share.
Negotiations for the underwriting have been
conducted with W. C. Langley & Co. and
Aronson, Hall

investment

interest rate of 3.%% and will run 25
years.
was intended
to file the issue with

will carry

the

week, the

filing

has

been

market conditions.

delayed

due

Although
SEC

this

unsettled

iWM
Koppitz-Melchers, Inc.
July 5 reported company will shortly offer to its
share¬
holders 128,697 common-shares
at $1 \ share. " Stock¬
holders will have the
right to purchase three shares for
every 25 owned as of June 27.

Kansas Power & Light
Co., Tdpefca, Kan.
May 31 reported company probably will
replace out¬
standing bonds and preferred stock with new lower
securities. Probable bidders if
securities
clude Halsey, Stuart &

cost

are

sold

in¬

Co., Inc. (bonds only); The First
Corp.; Blyth & Co., Inc.; Kidder Peabody & Co.:

Boston

Harris Hall & Co. (Inc.).

>•.-

:^4^agnia,:Cpppp^GP^K^®^^

..a ma*;

Aug. 29 stockholders will vote on
increasing the auth4»
orized capital shares to
1,200,000 from 410,000. The addi¬
tional 790,000 shares, if
authorized, will be offered later
at prices and amounts to
be determined by directors.
The purpose of the
financing is to provide for develop¬
ment and equipment of the
company's large low-grade
San Manuel copper ore
body in Arizona.

Metal

'
*
May 29 filing of letter of notification
expected in near
future of 60,000 shares of common stock
(par $1) to be
Forming Corp.

sold for the account of certain
stockholders.

Corp., is to be underwriter.
offered at $7.50 per share.

First Col¬
Stock expected to be

July 12 reported company intends to file by notification
25,000 shares of convertible preferred stock and 25,000

ony

shares of common stock.
Irving J. Rice & Co., St. Paul,
It is expected that the
Minn., will be underwriters.
preferred will be offered at $6 per share and the com¬
mon at $3.75 per share.
i
,4 / '

Michigan-Wisconsin Pipe Line Co.
May-3 it was reported that Michigan Consolidated Gas
Co+ through the purchase of $17,000,000 in cortimon
stock, would acquire full control of the Michigan-Wis¬

Hollander

(A.)

& Son, Inc., Newark, N. J.

July 25

stockholders will vote on splitting common
stock 2*/2-for-l and on authorizing an issue of
$1,500,000
convertible
preferred stock,
Probable
underwriter,

Merrill

Empire District Electric Co., Joplin, Mo.
May 3 company filed application with the Arkansas P. S.
Commission for authority to issue $2,000,000 2% % first
mortgage bonds due in 1976. Proceeds would be used for
additions and improvements to the company's
properties
In Missouri, Arkansas, Kansas and Oklahoma. Probable
bidders include The First Boston Corp.;
Halsey, Stuart
& Co. Inc.; Shields & Co. and Lehman Brothers;
h

be merged into

common shares as

•

shares will be cumulative

Crown

Detroit Edison Co., Detroit, Mich.
19 committee of directors formed

Corp., New York' J

Aug. 15 shareholders will consider authorization - of
200,000 shares of serial preferred stock ($25 par) to
provide for a $2,800,00Q refinancing program, and for
additional working capital. An initial series of 115,000

program.

shares in September.

March

000 shares of common stock
(par $1).
filed at an early date with Newkirk &

(Del.)

Corp.;
Halsey, Stuart & Co. Inc. (bonds
only); Dillon, Read &
(stock only). •
;,
• • ;
\

The U. S.

before September.

Clothes, Inc., New York

July 1

July 8

share.

Co; Inc,

heyr. stock: wilj be! offered ' for' sub^Qriptibn,
per

i'-Aiir

the company to
carry out the provisions of the amended
plan. Probable bidders include the
First Boston

Fidelity & Guaranty Co. (parent) has announced that
it will exercise. its right to .subscribe to the stock, to

first mortgage

new

3,000,000

Curtis.

Continental Foundry & Machine Co., Chicago
June 20 stockholders voted to
create
a
new
issue

will be convertible into two and

The

to stockholders pro rata at
$40

amended plan filed with SEC cdrtipany proposes to sell through
competitive

canceled.

Co.; W. E. Hutton & Co., and Halsey, Stuart* & Co., Inc.

•

Interstate Power Co.

Fidelity & Guaranty Fir ©Corp., Baltimore :
tion program, corporation is expected to sell approxi-;.
July 26 stockholders will vote on increasing authorized
mately $110,000,000 debentures to pay off balance-of
•Capital stock frbm 100,000 shares to ,200,000 shares (par
senior ? securities. and provide funds for property ex¬

pansion.

reported that company is planning
Otis & Co. reported as probable uniderr

May 21 pursuant to

5% ($50 par) cumula¬

subf

owned

was

financing,

: i

tive preferred issue.
Preferred holders will receive one
share of the new stock plus five shares of common
.for
each preferred share. All
common stock -• of. the

Columbia Gas & Electric Corp., NewYork
April 12 it was stated that in final step in recapitaliza¬

393

Lynch, Pierce, Fenrier & Beane.

Illinois Power Co.,

July 2

Decatur, III.

has filed a recapitalization plan with SEC
pursuant to Section (11) E of the Utility
Holding Com¬
pany Act. The plan differs in one essential from the
financing application filed with the Commission last
April. It calls for complete cancellation of the interest
held, in the, company by its statutory
company

parents, North

American Co. and North American
Light & Power
These holdings comprise

stock, dividend

arrears

Co.

certifi¬

cates, Central Terminal Co. notes and warrants to pur?
an additional
300,000 Illinois Power common shares.
The plan follows the
financing application in providing
for issuance of $10,000,000 of new
preferred stock to raise
funds for paying off the
$11,596,680 of dividend arrears
certificates and in calling the
existing $24,175,000 pre¬
ferred stock for redemption in order to force its con¬
chase

version into commonion
An underwriting will be

basis of two shares for oner.

arranged for the conversion in
order to sell the amount of common stock
needed to pay
.off the preferred not tendered for conversion.

Probable

consin Pipe Line Co. Sale of the stock to
Michigan
Consolidated would be a part of the initial
financing
of the new company, which
proposes to build a $71,*
000,000 pipe line to bring natural gas from Texas te
Midwest States.
Michigan-Wisconsin's proposal also
contemplates issuance of $6,000,000 in 2% 5-year serial
notes and Of $34,000,000 in 3%%
20-year first mortgage
bonds to complete the "initial
financing." The plan ha#
yet to be presented to the SEC. Probable bidders of the
bonds include Dillon, Read & Co.
Inc.; Glore,
& Co.;

Forgan

White, Weld & Co.; Halsey, Stuart & Co,

and Mellon Securities
•

Mid

Corp.

fici
\

Valley Distilling Co.

J
|

July 18 reported early filing of common stock, with K F.
Gillespie & Co. as probable underwriter.
Milwaukee Gas Light Co.

July 18 SEC will hold hearing on the proposal to
chang^
its authorized and outstanding common stock from a
par
value of $50 a share to $12 a share and increase the
number of authorized common shares from.
260,006 to
1,150,000 shares, and incidental transactions.
The pro*

posed transactions are steps in a general program of
American Light & Traction Co., the parent
company, tQ
effect compliance with the Holding

Company Act's

(Continued

on page

394)

pro-?

•

TlHECOMMEBCfALfcrim

394

"y/'V--( (Continued from page 393)

both preferred and common

•;

Lines/ Inc., Chicago

Probable under¬

National Gas & Electric Corp.,
II

June

company

Co. (jointly);
and The First

filed with SEC a voluntary

plan of
!f

ally, for redemption of the presently outstanding 5%
lien collateral trust bonds by using the proceeds
new

$2,100,000 secured bank* loan, and the repay¬
bank loan with funds to be received by

ment of this

of the bonds
Utilities Co.
of Michigan, and Industrial Gas Corp. of Ohio. The new
$980,000 first mortgage 3% bonds of the Michigan sub¬
sidiary would be sold privately at par and accrued inter¬
est through an investment group consisting of Battles
& Co., Inc., Philadelphia; G. H. Walker & Co. of Provi¬
dence, R. L, and Smith, Landeryou & Co., Omaha, Neb.
Under the plan. National Gas & Electric also would
dispose of its holdings in Nor Jiern Indiana Fuel &
the

corporation as a result of the refunding
wholly-owned subsidiaries—National

•

rX i

;

are

house,

sold, in
1, 1945,

-**.

and two

July 1,
bidders

s'; • ^

Paul, Mlniti
It was reported April 10 that company has under con¬
sideration the refunding of $55,000,000 collateral trust
4Vi % bonds due 1975 and the issuance of a new^ series?
of collateral trust bonds.
Prospective bidders, Morgan
Stanley & Co., Halsey, Stuart & Co. Inc., and Kidder,

reported that a plan for merging North¬
western" Electric Co; and Pacific Power & Light Co. was

with the SEC. The plan
The first will deal with the merger

believed about ready for filing

will offer

•

Ohio Publlo Service Co.

May 28 it was reported that early sale by Cities Service
Power & Light Co. of its common stock holdings of Ohio
Public Service Co. was probable following the virtual

(par

''i; 's'

•

v*-" i

'* 'f'Ji'C*

Utility Hold¬

Stevens

Company contemplates at same time Standard Gas &
stock (in ac¬
cordance with SEC regulations) to sell approximately

Electric Co. sells its holding of common

stock, proceeds of which
retire bank loan
used in redeeming" the 7% preferred stock. ; Probable
bidders will include Merrill Lynch, Pierce, Fenner &
Beane; The First Boston Corp., and White* Weld & Car

Sun

(J. P.)

fund

Chemical

Co.

& Telegraph Co.

tion

•

July 8 it was stated that to help finance its $400,000,000
postwar construction program, of which more than 2i%:
will be
fall

expended this year, company plans to sell tbi*
issue of $75,000,000 debentures and to offer

Southern,

Inc.-

;

;Waterman Airlines

•

* *

—

:
„.

April 11 ICC conditionally, authorized company- to issue
$10,000,000 first mortgage- bonds, series B, due- Jam^ 1;
1981, proceeds to be used to refund a like amount of
first mortgage 4% .bonds due Jan*; 1, 1974, and hclCby
RFC.
Interest rate to be specified in bids.
The direc¬
tors have rejected the-condition's attached by the ICC
but the' cdmpa'n'y: on May 27 filed a peti;ioh fdrrrecon¬
sideration and oral argument.
Probable bidders include
Blyth & Co., Inc.; Bear, Stearns & Co.; Halsey, Stuart
ALCo./ fo&jr; Merrill Lyj&^
Shields" 8c Co., and. Glore;:Eorgan Jr Co.
;; ^ / /;
^

bination of stock and debentures.?

• Proceeds will be -use4
off a recent $80,000,000 bank loan and for addiT
tions to working capital.
Probable underwriter, Kuhn,
Loeb & Co.
; ^
T'

to pay

Stores!, fttc/

JUne 24 reported1 an early

~r r~

!--5i /<-. r ^ r^gistraiidn of %'fiW shared

convertible

preferred -stock and- 50,000 shares of
expected with " First Colony Corp.-;
Rauscher, Pierce- & Co.| B; V. Christie & Co;; Courts
& Co., as underwriters.
Preferred represents new fi¬
nancing, common being sold by stockholders. ' Expected
preferred will be offered at $20 and common at $10
per share.
common

Probable un¬

;,*•

.,-j

%■

type of securities to be used has not been definitely
determined, present ihdications are that it will be a com- If

stock

Wisconsin

...»

;»

Announcement expected at

date.;x

Westinghouse Electric Corp., Pittsburgh

obtain funds to
complete arrangements for the acquisition of Gosset
Mills by Textron Southern, Inc., a subsidiary of Textron
Inc., is expected. shortly in financial: circles. Probable
underwriter Blair & Co/',

Juhe 27 reported 'corporation jexpects to'complete within
the next month or so a long-range financing.; Whiter the

authorized convertible preferred stock from

Textron

possibly re-

Western Pacific NR.

Shields & Co, as under¬
■"

property, at their discretion.

fompah^ inay

May 22; reported company working!on plans toi refinance
$44,901,000 first mortgage 4S. .Probable bidders include
Kuhn, Loeb & Co;, and Halsey, Stuart & Co. fob/ ^

Public

Service Co.,

Milwaukee, Wis.

May 20 it was repofcCd that Standard Gas & Electric
Co, expected to sell at competitive bidding some time
this year its holdings of 1,099,970 shares of common stock.

June 26 announcement of financing to

pro

|B Western Maryland By.

derwriter, Blair & Co.

new

rata to preferred and common stockholders the right,
to purchase 328,125 shares of company's common stock
at par ($100). Proxy statements have been sent to share¬
holders concerning the authorization of the additional
common shares and the giving of preemptive rights iu

refinancing program.

Juan and New York.

500,000 to the 200,000 shares now outstanding, ^Directorsp
also would be empowered to sell common stock for cash,
Services

i)t^.v,

Bond, Inc^ Newark, N. J.

White Auto

considering thd ques*

July 17 reported company contemplate^^ new .financing^
Company, intends^ toinductnott-sto# aMoridse' be¬
tween New Orleans/ Sain Juan, Puerto Rico1 and "Ban

increase
in the authorized common stock from 1,700,000 to 4,000,000 shares, split the common on a two-for-one basis, and
reduce the

are

its

early

August I stockholder s will vote on approving1

,• ■

meeting the $100,000,000 first mortgage railroad

Waitt &

mfv

fx;

;

June 12 it Was reported company has under considera*

Pacific Telephone

$500,000[ 5%

$47,000,000 first mortgage 3y4S of 1971 with a
lower coupoii issue.
Possible bidders Include Halsey,
Stuart & Co.,. Inc., and Kuhir, Loeb & ;c<jl

& Co., New-

200.000 preferred stock; with1
writers.

May i;Tt-^was-^repbrted that;

June 18 reported that company pIans;early registration
of $4,275,000 20-year sinking fund debentures and $1,-

Pacific Lighting Corp.1
June 7 directors authorized the management to prepare
plans for refunding the corporation's 200,000 shares (nopar) cumulative $5 dividend preferred. Blyth & Co. will
probably be underwriters* | Y
>"\-

•

WTiters^foay include^ f^S;;MbsleyWhite; Weld
& Co.; Ladenburg, Thalmann Corp., and Lee Higginsop
Corp.-;;--r
^ '

140,000 shares of new common

will be used to reimburse treasury and

(Kansas)

Inc.

structure.
Nothing definite as to the types of securities
that; may be issued has been reached as yet*
Under*

May 29 it is rumored that company expects to do some
new financing
in the immediate future following the
merger of several Southern mills in which the company
holds a. controlling interest. Reported-Morgan Stanley
& Co. probable underwriter.
;; ^
"

City

1971 with
Possible bidders would include Dillon, Read

the ; management' has under consideration - the
simplification of the company's preferred stock and debt

W.) Co.r Philadelphia "
*
July 5 company was reported negotiating for the pur¬
chase of Mallory Hat Co.
This transaction' and other
phases of the company's expansion program -will; it is
said, necessitate a long-term loan of $2,500,000.

the Cities Service Co.: from, the

July r 3

$5)

t* •••/

contemplates refunding; it$

f -sr".t

Verney Corp., Boston, Mass.

Stetson. (John

completion of the refunding program of this subsidiary;
is one of the few remaining steps prior to com¬

Oklahoma Gas & Electric Co., Oklahoma

Service Inc.

This

utility field in/ compliance with, the Public
ing, Company Act;.

" t

(Mo.)

Southern Electric System,
May 10 pursuant to substitute plan for retirement of
preferred stocks of Electric Power & * Light Corp., filed
with SEC common stockholders of Electric Power &
Light Corp., would be given rights to subscribe to United
Gas Corp. common stock and stock of the new holding
company Southern Electric System, Inc. The latter com¬
pany would be formed to hold the stocks of Arkansas
Power & Light Co., Louisiana Power & Light Co., Mis¬
sissippi Power & Light Co., and New Orleans Public

placing the present funded debt with $27,000,000 mort¬
gage bonds and $3,500,000 10-year serial notes.
Prob¬
able bidders include Blyth- & Co., Inc.; Halsey^ . Stuart

plete divorcement of

•

' .'xt

company decides to refund through new issue probable
bidders' will be Kuhn, Loeb & Cq.« :and/ Halsey^ Btuart
& Co. inc.
r
■; ;
v

recapitalization plan becomes effec¬
tive) sufficient common stock to realize $10,000,000,: to
bet invested in Southern Co.fs subsidiaries and new

preferred stocks, on a share for share basis, with a cash
adjustment* The second step in the merger plan may
be filed ;early ini: August.
This will provide for re¬

v • <• £'&?;«..

" J,

maturity date.is too far away to determine now whether
will be paid off in cash or will be refunded. If

Commonwealth's

$10,000,000 pfd, stock at: competitive, bidding. Dividend
rate and price will be determined, by the bidder.
ProfcK
able bidders include,; Blyth & Co.,. Inc.
After the price
is set, the new preferred stock will be offered to present
holders of the Northwestern and Pacific 7 %zand 6%

?•,.\

-'"y:

;

Co. of Missouri

;■

»•-

issue

Southern Co., New York
The Southern Co. (to be successor to Commonwealth
& Southern Corp.)
proposes to sell for cash (when

capitalization.

^Yfl;

;

£hd lahd grant' 4f& due; Julj^Tr;l947*sTfowbver it is ielt;

to 300,000 shares {(par?" 25ch
Shareholders will receive rights to subscribe • to 100,000
shares at not less than $2.50 a share.
Remaining shares
will be optioned to directors at same price.

was

tion of

a•.

f '*<: S\

<7V*'L

May 9 it was reported officials

Savoy Oil Co., Tulsar Okla.
July 1 stockholders increased authorized commoh from

150,000

;

."•£

Union Pacific RN.

Boston Corp.

Peabody & Co.

& Co. Inc.
-); (-Y #''{' Sv

.underwriters to residents of Kansas only

{public Service Co.April 19 the company petitioned, the ^ Missouri Public
Service Commission to simplify its financial structure,
including reduction in interest and sinking fund changes.
Company proposes to retire current funded debt ($11,640,683) and to issue up to $10,000,000 new^ bonds, bu„t
limited originally to $6,000,000."
Probable bidders in¬
clude White, Weld & Co.; Blyth; & Co., Inc., and First

Northern Pacific Ry.y St/

'{;/ I.A.j,

-;'.r

St. Louis

& Co.

company;

'i',+-+

.-'vi

v.r

iprefer^ stock (par $lpoy at $108 pei shared

July 9 it was
stock (now owned by Portland Electric Power Co.,
parent) may be publicly offered later this year, in com¬
pliance with the Utility Holding Company Act.
Prob¬
able bidders include Blyth & Co., Inc. ; ;;
*0}j v-1

with

not-made

Union Gas System,

Co..-m0?
^a
'
stated that the 296,8191shares^^ of ^tnihoii

-iV'-

filed

automobile

jUnder provisions of merger plan ofT Union Gas Systenv
Jnc; (Deiawai^V andxUnidm Gas:^^ System^ Inc/^^ (Kan.)
latter has completeu negotiations to-sell through Kansas

Portland General Electric

Inc., and Harriman, Ripley

step, the merged

was

obligations.'

55,00Q shares ($10 par) common of the Petersbtirg (Ya.)
& Hopewell Gas Co., a subsidiary, to Scott, Horner &

Public Service Co.

the

car..-The name of the<investment i

jcutstandingl $90,QOb,000 3%s; of

Pennsylvania wilt sell

program,

into

passenger

tt is rumored that company

subsidiaries to- carry out 'stock transactions as

integration

with an investment house to on- i
public- issuei.of-about $20,000,OOiO tb ;

venture

Union Electric

Halsey, Stuart & Co. Inc.; and Salomon Bros. '&

part of an

April 17 reported that"company has Uhder corisideraticffi
the refunding of its $45,000,000 series C 3y8s with issue
of about same size carrying lower coupon rate. Probable

the initial

.public but it was stated an anHouncement of the financing would be- made, public in
'abouteight-weeks.
'
•
•
>•

proved a proposal of Pennsylvania Gas & Electric Corp.

derwriters.

his

rear-engine

•
Petersburg (Va.) & Hopewell Gas Co.
July 11 the Securities and Exchange- Commission ap¬

reported company plans early registration of
30,000 shares of 6% preferred stock and: 30,000: shares
of common, with O'Connell & Janareli as probable urt*

and with changing the stock

from time

Corp.,/ Chicago

pleted negotiations
finance

135,000 of 1%% certificates under equipment trust, series
Q» to finance acquisition of 45 locomotives and tenders,
112 passengers-train cars, 300 covered hopper .cars, and
12 diesel electric switching ' locomotives. •, A previous

July 16

will be in two parts.

Tucker

•derwrite an initial,

the remainder of ah aggregate issue of. $18,-

Northwestern Electric Co.

additional

directors- are
time as they deem

stock which

fufy 4II the Securities/ and Exchange" Commission1 ap-

Newburgh Steel, Co.

June 28 it

common

/;^[:Toleda':(Ohip)'.'-Cdisoit:Go^'

Mason, Inc., Lynchburg, Va., for $600,000; plus adjust¬
ments.
*

bidders, Halsey,. Stuart & Co.

authorized

the

split

Hutzlef.

Light CO.

Northern Indiana

was reported that a refunding program is
contemplated at an early date for this company to bo
followed later by; sale at competitive bidding of the com¬
mon stock now held by Cities Service Power & Light Cq.

Y'
The company is inviting bids to be received July 23 for
the purchase of $7,322,000 of equipment trust certificates,

include

of its

•

and

one

common

issue

•May 28 it

Pennsylvania RR.' (7723)

issue of $10,290,000 of series Q certificates was
July, 1945. The certificates will be dated July
and will mature On July 1 in each year' from
1947 to and including July 1, 1960.
Probable

first
a

July

■■

Dillon, Read & Co.; Smith, Barney 8C Co;,
Boston Corp, (jointly).
< ;
;

which

simplification and recapitalization calling for retirement
of the company's entire funded indebtedness through a
series of financing operations.
The plan provides, initi¬

New York

authorized

Pennsylvania Power & Light Co.
July 12 reported National Power & Light Co: (parent)
plans the sale of 682,013 shares of common stock in com¬
pliance with Utility Holding Company Act.? Probable
bidders include Lehman Bros., and Kidder, Peabody &

May 23-it was,reported that company may refund,it*
outstanding $4,300,000, 5% debentures due 1959 later this
year with new lower-cost securities.
writers Van Alstyne, Noel & Co.
'

shares for

stock four

.104,428

voted

•

Probable underwriters include

National Container Corp*

stockholders

The

desirable.

May 15 it was intimated that company may have financ¬
ing plans in connection with steps being taken in ac¬

quiring additional lines.
Reynolds & Co.

Tidq Water^^ Power Co., YVilmington, N.

stockholders to subscribe for

purchase shares,/; The debentures will be sold tnrough
competitive bidding. / The probable bidders are Morgan
Stanley & Co.; Halsey, Stuart & Co.: Inc.; Blyth' & Co:,
Inc.
I c:: : Yx YYYYyIYY|:^
•
or

visions, which will ultimately result in the liquidation
of that company and the distribution of its assets, -i x
National City

Thursday,"July 18,1946

Probable bidders include The Wisconsin

Boston

Corp.; Harriman Ripley & Co.

Co.; The First

THE COMMERCIAL & FINANCIAL CHRONICLE

Volume 164, Number 4508
w/v

A >-;•

The

«|'\w;w' «i >.>-y v.;

'v-

'VtJ,Ny*'p4.-

-y r.i./£»•}«, V*.*••**'■'•

395

w sH.-rf «*■$.■* t

Stranglehold et Monopoly in America

close attention,

When you won¬

der

why your- representatives in
Congress are not responding to the
■': (Continued from page 346)
popular will, ponder the strength
Ksoaraiirig ^}ieil)we'iyeix|i shopping turmoil at,home, they are so in¬ of monopoly. Ponder particularly
we witnessed ihe success of the
fluencing our foreign policy that it the monopoly picture in the news¬
monopolists in wrecking effective serves monopoly and monopolistic paper .publishing, business., :
price; control against the expressed aims in the .international fields ,:
Gentlemen, I submit that the
Wishes of the overwhelming ma? ; ,Wp must recognize that a new
problem of monopoly is a dire
^ority jtof^tho American ^people, tolerance for monopoly in America threat td our^democratic; way of
handmaiden of, mo^oply?-4h§ was brought about by the war pro¬ life. The concentration of power
l^atiphal Association, of Mamaf act ductionrecord?of our/ economy which is occurring in the business
iurers—is asking for and deserves Funds fhat t would* &herwise; have world is
threatening the sov¬
public credit for the wrecking of gone into the public treasury have ereignty of the American people.
the Office of Price Administrar financed slick and colorful adver¬
We can meet this threat only
lion. This is only its mos- recent tisements in the large magazines
by intensive political activity on
assault ; upon - our people.
Here which hav£ undertaken tor prove
the part of every progressive in
?px&i& few^utheri.itenis«in,.thA,xec^ that it J was 1 the Assoctotkm' of
the country, particularly on the
tord of monopoly's successes in the American Railroads^ duPont,Genpart of you lawyers who form the
Congress of the United States: 't eralii Motors^., VTestmghouse > /and
1* I.. Let them take .credit.for, the General Electric who were respon¬ very spinal cord of a progressive
sible for our great war effort and popular movement.

legislation, in which I include the the Navy, the Secretary of the In¬
Taylor-Mitchell - b i 11 requiring terior, and the Secretary of State
officials to give full

government

formulate

unified American

•

passage of the carry-back, carryforward tax law which guarantees

;

lawyers

lockouts of their striking workers,

;

-lit has accountedformanydelaysin
pie^ resumpion of peactime pro*j
iduction, ;for?|f,^ar^6es profits

secret ties to corporate

skill and

you

are

former

enterprise.

weaken

the

anti-trust

strengthening of

the

laws,

Secretary

this

Rejectipn of all attempts to that

Ickes revealed
has not, as,

committee

and

Anti-Trust

The climate and living condi¬
tions in the Marianas resembles
closely that in the Hawaiians and
must never again be permitted to in Puerto Rico. It would provide
atrophy as it did under Harding,, a suitable outlet for much'of the
Coolidge and Hoover.
surplus population which jConstir
4. The enactment of the anti- tutes Puerto Rica's major prob- /
monopoly legislation already pro¬ lem. Or these islands would; prp- :
posed by the TNEC, together with vide opportunity. and refuge to
the resumption of the investiga¬ many of the
displaced persons
who are now thronging Army.
tion of monopoly.«
,
..
camps in Europe. Unless the ini¬
5. Finally, I urge that we carry
tiative is taken by the President's
out the mandate thrust into our
hands by Franklin D. Roosevelt committee, it is not unlikely that
the return of the Japanese to
when he urged Congress to study;
Anguar's phosphate works will be
and halt the concentration of eco¬
but the prelude to their return to
nomic power.
As he stated on
the sugar fields of Saipan add
that historic occasion:
-

Division with increased appropria¬
tions.
The Ana-Trust Division

in a key
legislative
to
halt the
front: lines Will rememberAdipw threat of monopoly and tq assure;
a
stable
economy
with
full em¬
you appreciated the ads that told
"The first truth is that the lib¬
■5^^Who,',wa^wihnhag.thd wajr,-. ployment/ Whose prosperity Will
a democracy is not safe if
But time has begun to remove be shared by the farmer, the in¬ erty
the
people tolerate the growth of
this colorful protective cloak and dustrial worker^ the white-collar
worker, the professional and the private power to a point where if
reveal thakihescm^
becomes stronger than their demo-^
same; combines which the -people; independent tusib^ssmattt:i —r
•;
not" the collective labor,

jprofks to corporations for two genius of the American people. position to advance
years»after the war. This chari¬ Those bit you :whu: fgught in, the program designed
table provision. has financed
iworthy causes like General Motors
land Westjinghouse in their virtual

fidelity to the public trust, free of policy for these islands. Recently

sTinian.; American

business

may

yet have the enterprise to, survey
the
commercial possibilities
Qf
■

these islands, and to sponsor the

development which governmental

seems reluctant to under¬
itself.
That, in its take.
is Fascism—ownership of
I'.',
In, building such a legislative gpyernmenti by an individual by
Ico^poratlona pfoduce oy npt/^ It fpj
DIVIDEND
NOTICES
a
group
or>
by
any
other
con-i
program
I
urge you to consider
erfully entrenched and more dan-'
,-|aWbsidl(-;fQr;aelfishness. ' J
; trolling private power;
gerous
to America and to the and espouse the following:
I <2. Give the monopolisms credit
than
ever
before:"• Asf
"The second truth is that thp
'for the emasculation of the 1944 world
Kilgore Reconversion bill and the Roosevelt organized the defenses Economic program first proposed liberty; of a democracy 1$' not* safe

cratic

corporations out of the Treasury of this country recognized as their
•of the United. States whether those enemy and set out to'destrby ihb£e>
to

Has Legislative

Program

state

essence,

Employment. of the United Stales to meet the, in July, 1945, and largely incor- if its business system does not pro¬
the Nazi-lTascist, t aggression - againsf .porated -. in President Truman'4 vide employment and produce and
possibility of economic turmoil in ihe worlds he was to learn the full September, 1945, legislative pro distribute goods in such a way as
to sustain an acceptable standard
Iwconversion
if • no
procedures price which, was, to be exacted by gram.
Of liying^#i:p',r;:.;v' \
vfwero woarked^uL It /provided ah American monopoly for eooperaorderly plan, to last for two years tion in the defense/of the/nation'
:after the: war* to> produce tpeabe^ enormous war profits plus a still
time goods, housing, prices, wages greater control of the economy of
1945

bUL

Murray

inertia

McGrawElectrie

Full

The Kilgore bill foresaw

Company

and

purchasing power, and other
reconversion problems.
The Mur¬

ray
bill provided a long-range
plan for full employment.
Both
bills were violently attacked by

the National Association of Manu¬
facturers and by the United States
Chamber of Commerce and they

|were gutted-by Congress,
j
;f* 3. Giyeidhe eleCtfic ppwer inonopolists
ihe

.he United States..
It

Our Sterile

;

apparent that President
Roosevelt and the people of Amer¬
ica could not fight such a twofront war
(as one) against the
Axis abroad and the monopolies
at home.
The monopolies engaged
iA A sit-down^ strike against the
securi.y of the nation by refusing
to accept war production orders
was

establishment

TVA's

for

/They ; waited

ditch hnd water will, pour through of the' railroads - were in control
it to turn giant turbines that will of'the Wartime petroleum and
produce cheap power, under a railroad agencies. The result was
I Columbia River Authority,.
\h that by the end of 1945; the 63
manufacturing
corpora¬
I
4. Give the insurance,
traps* largest
I portation and newspaper monopo¬ tions (as listed by the SEC) had

renewed attack increased their net working cap*
I designed to destroy the anti-trust italby |1Q billipnof higlte liquid
j laws—an attack launched after assets—or twice the net working
those
monopolies were ! caught Capital; of all manufacturing cor¬
! red-handed by the Department of porations in 1939.
Mergers in¬
•Justice
in
collusive
tobnopoly creased,"gov e rRin e n t f$ciRUc$:
lists credit for a

| of the pockets of the people,
5. Add to the list of their

-accora-

plishmehfs

j the present session of Congress
A of
i

the

Minimum

pigeon-holing

of:

Wage bill, the
the
National
the delay and

1 Health program,
j crippling of the Veterans Housing
I program

and similar onslaughts
I upon the standard of living of the

| people of
America.
:<
t&'-yy;t...,~v>f*r ,w.w..,W $

v-lsm/

Monopoly in International Field
And while the

program

of the

monopolists is creating economic
&

included all of the Marianas ex¬

cept Guam, the Palaus, Gilberts,
Marshalls, and Carolines. During
the period between the two wars
were taken over and the concen¬ in which these islands were adr
tration of power reached new ministered by Japan, they were
heights,
Profits reached ah aR? thoroughly exploited by the great;
Japanese South Sea Trading' Com¬
time peak.
'
pany,, the Kuhatsu.
Colonization
and
immigration were under¬
Wealth Sought Center of
taken, and large numbers? of
Economic Activity
Japanese, Koreans,
Okinawans,
Those
who
had,
got
more.
and Formosans were brought to
Wealth sought the center of eco¬
the islands. To Saipan alone came
nomic gravity.
some
40,000 immigrants. Phos¬
The Senate Small Business Com¬
phate works were established on
mittee has recently released a re¬
Anguar and Rota—the latter only
port
which
demonstrates
the
some 40 miles north of American
amazing degree of concentration
owned
Guam. Of
the
1,500,000
Which has taken place during the
tons of phosphates imported by
war.
I commend it to you for
Japan xn 1939„ approximately one
fourth came from Anguar alone.
Large/ sugar plantations were
established on Saipan, Tinian, and
other Islands.

FOR SALE
7

rooms

and

garage

Millerton, N. Y., within city limits.
and

modern

one

acre

than $6,000,000. On all of
these Islands railroads, telephone

systems,, and other modern

Electricity,

throughout.

Harlem River Division of the New York Central
R. R.

Price

York 8,

"Chronicle," 25 Park Place, New

com

commercialization

installed.

lands

(particularly in the Mari¬
and; Palaus)? are? tropically

Many of these is¬

the

Secretary-Treasurer.

I
-

near

had

The Board of Directors of

Weiitworth Manufacturing

Company
declared

has

dividend

twelve; and/ tone-half cents
^
(12^c> per share on the out- . i
standing cqmmon stockof the : :
Company, payable on Au- /
gust 22, 1946 to stockholders ^ -•
tof rdcord at the close of busif
ness

August 1, 1946.

Checks will be mailed.
JOHN E. McDERMOTT,

minimum# In 1937 Guam's total

exports amounted to but $109,000,
mostly ; accounted for by copra.
The possibilities,, in- Guam's, 206
square

miles have had little

portunity

op¬

fo^ reahzation under,

naval administration.

The sterile

policy which we applied in Guam seems to be the

keynote of
the

other

NATIONAL DISTILLERS
PRODUCTS CORPORATION

our attitude towards
Pacific islands which

The Board of Directors has declared

quarterly dividend of 7$4

per

a regular
-share and an

dividend of

extra

75^ per share on the outstanding Common Stock as now constituted.)
payable on August 1, 1946, to stockholders i>lrecord on July 9, 1946. The transfer books
will not close.

•

THOS. A. CLARK

27,1946.

June

treasures.

have taken by conquest. Since
last fall naval and Japanese, ves¬
sels have systematically removed
we

all

WOODALL

Japanese, Okinawans, Koreans

land Formosans from these islands
leaving on Saipan but a few hun|4
dred Chamorros, and small native
groups on the other islands.

The

Japanese
commercial improve
monts and the up-to-date roads
and sewage systems, introduced by
our own

disuse

INDUSTRIES, INC.
A

regular

per1 share
ferred

quarterly dividend of 3114e
on

Ihe 5%

declared

been

Convertible Pre^

<$25.00' par f value)

Stock

payable

September

hat
1,

1946 to ■stockholder^; of record August

15.

1946,

Seabees have fallen into

M. E. GRIFFIN,
Secretary-Treasurer*

many, of these islands,

•

and are slowly being; recaptured
by; the: jungles^ Not a single at¬
tempt has been made to resettle g>pemet EeUagg &
Mtl
and develop these islands under A quarterly dividend of $0.45 per share hai
American adminishtration, al¬ been declared on the stock, payable September
10, 1946. to Stockholders of record as of the
though on Tinian /alone there is close of business August 17, 1946.
JAMES L. WICKSTEAD, Treasurer
an immediate need for 10,000 col4
onists to provide fresh foods for
:

the

pineapple, coconuts, avo¬
cados, and other tropical and semi-

the Central Pacific.

tropical fruits and vegetables.

Our capture of the Marianas cut

President; Truman appointed
a
committee consisting of the Sec¬

Japan off from its principal source

retary of War, the Secretary of

•

McGraw

war

abundant in the production of ba¬
nanas,

N. Y.

were

anas

$14,500. (No Brokers Please). Write

Box J. L., c/o

1937 sugar ex*

comitants

running water

ports from Saipan atone amounted
to

House of

Prior to

Judson Large,

Babelthaup—
Anguar- in the Palau group**
been & major Pacific resort
hf Rennittiiig this^^ Jis a sharp de* for the"'Japanese, and had been
parture from previously estab¬ considered the Japanese Honolulu,
lished American policy in the PaIn contrast to the Japanese polciffcr andi should focus our atten*
icy of' exploitation, of ^these4 Is¬
tion on the economic potential of
lands, we followed a program op¬
the islands which we have ac¬
posing. any development at all on
quired by conquest in the Pacific.
Guam;1 the only fsland held by us
There is real need for a formula¬ in the
Central Pacific before Ihe
tion of definitive American ppi*,
war. r.Three tifnes
as large
as;
icy, and an opportunity to pro¬
neighboring Saipan,' and /even
vide a haven to many of the dis¬
more abundant, Guam was * kept
placed persons in Europe, and an
just as a naval station by the
outlet for our own population sur¬
Navy, with its economic develop¬
plus in Puerto Rico.
ment held in: a state of arrest.
T The islands formerly owned by
Commercial
development. ; .was
Germany and acquired by Japan
discouraged, and the visits,. of
under mandate after World War I
merchant isldpping were. kept at

until they were paid their own
Valley and for crippling the post¬ prices; their patriotism was costSoon big business was ih
war
program of the Bureau of plus.
Reclamation of the Department of control of Ahterica's^^ Wair product
The War, Production
Interior.
The; people of mytoei?- tion effort.
tion need a Valley Authority. But Board was headed, successively by
the power lobby is fighting us to Settinius, ICnudsen, Nelson and
the last ditch.
Bid I promise you Wilson^' Representatives^ of the
th® l>whers
.this—the last ditch will be a big oil companies^ahd

I practices which were paid for -out

whicb i o r id ef 1 y Were

pmrt bf their jnahdate: from the
League of Nations. The action taken

the Columbia Valley and .Missouri

•

Policy Toward
The Conquered Pacific Islands
(Continued from page 344)

islands^

Directors

Electric Company have de¬
clared a. quarterly dividend
of
500 per share, payable
August 1, 1946, to holders of
common
stock,. of $1 par
value- per share, of record
July 18th.

phate, of which there is an acute of sugar, and has been directly
shortage in Japan. This is the first accountable for the sugar short
Ume that Japanese have been per-* age that exists throughout Japan
mitted' to return to any of the today.

the credit for blocking hnhlaeceierate^te
laws were enacted.

Dividend Notice
The

American

long

garrison forces in

ago

last

October

LIQUIDATION NOTICE
Meriden
National
Bank,
located
at
Meriden, Connecticut is closing its affairs. All
creditors of the association are therefore hereby
notified
to present
claims foe payment.
The

Dated May

13* 1946.

FBAN5; GUBRIQN, Cashier.
:-V

« ••:

<c.

THE COMMERCIAL & FINANCIAL CHRONICLE

Let Free Enterprise Prove lts Worth!

ernment must

In a situation such as rents,
which * has given many
people
much concern, the State govern¬
ments should
demonstrate their

important, we had a patriotic and would ruin fthe
American consumer.
$»'
thrilling
demonstration of the
fundamental patriotism of Ameri¬
Yes, American industry in this
can industry, commerce and agri¬
past week has lived up to, these
" 'K/v.;:;
culture,
of American
property points.
Just

feres witlrithe^ production
Citizens.}:'

retailers and
wholesalers, with but few excep<
owners,

of American

."'gill

tions/^i^fp;;"'...

Price Rises
To be sure there have been

These are

raises in prices.

many

said over attributable to a number of fac¬
the radio and in advertisements
tors. They are:
•in the press and in actions that!
(a) Necessary in order to cor¬
(a) It will not start a ruinous rect the abnormally low ceilings
price raising spiral to gouge the established by OPA which had
public; it will hold the line in so crippled production.
far as possible and in so far as
(b) Necessary in order to re¬
consistent
with
its
reasonable
align the natural system of prices
American margins of profit.
American industry has

It will curb small

(b)

minors

tics of chiselers and racketeers in
its own ranks, who will try to use

take ad¬

[the present situation to
vantage of the public.

'(c) " If given the dm^e* ft" will

"disprove

the

1 fear-mohgertog of

which has been artificially set for
four years.

and reds to the effect

that American business . was

un-

-•

public has shown

admirable restraint and selection
its

sense

common

that it will not allow

and shown

itself to be gouged by a

handful

its

will

that
Page

[ Bank and

willingness

358
Broker-Dealer Personnel Iteins...... 339
^Insurance Stock ,>

4.....«

[ Business Man's Bookshelf..........

to; buy , at prices

afford

manufacturers,

and retailers

wholesalers

rea¬

sonable profit.

338

My Present Position on OPA

of New Security Flotations 386
Canadian Securities ............... 350

; Calendar
'

Dealer-Broker
rv

Recom-5

Investment

mendatlons and Literature......

Mutual

Our Reporter

348

Railroad Securities
Real

Estate

Securities

that

fact

dent's
we

346

for

Says............... 385

page

Presi¬

should allow it to stay

test

dead

period, during which

the American system of free

chance

able

its

trols.

further

not

should

part of

series of 10

reasons

ably advanced by Mr. Holman

well as in the case of the

Let

not make a scape¬

of the American property
owner—millions,yof humble men

goat
and

who

women

the rest of

are

terribly squeezed

during the past

of rising

years

any case,

and livestock products
be

or¬

from

controls.

farmer

has

the

food

if only he will

freedom of action.
to

State,

344;

Connecticut

mell into the restoration of

page

345.

trols before

(3)

air,

Economic.,

demands

justifiable, in yorder

(a)

justification for the
there

some

government

emergency

factor affecting the whole econ-»

Commons & Pfds.

action

Continued freedom for the

(c)

NEW ISSUES

dairy and livestock industry.
vi'>;«• ; A;*^ * y
Conclusions

already

In this critical

pro¬

f
■

FOREIGN SECURITIES

period, not only

be allowed world,, we must make, sure that

I call attention

report which I have just re¬

ceived from Mr. Charles W. ttol-

do not put any restrictions or

road blocks in the way of

tion.

produc¬

achieve full produc-

M. S.Wien& Co.
ESTABLISHED

1919

v-; i '■

■

Members N. T. Security Dealers- Attn
40

Exckaait PL, N. Y. S

HA. 2-8780

;TSkArem*!-U*l

of - the National tion^there will be some slight in¬
Cooperative Milk Producers Fed¬ equities, but the important thing
eration, in which he reports that is to achieve full prpduction. And
Secretary

man,

in conclusion I want to state

since June 30th and the death of

so,

OPA, there has been little

three particular points regarding

appre¬

/
prices other this matter:'
(1)
Economic
than those normally to be expect¬

ciable

rise

ed because of the removal of sub¬

sidies.

In my. own State

Recent

common

demands that if you want

of Wis¬ tion in

any one

Northwest Leather

;

milk

produc¬

Sterling Motors

line, the producer

Recent

consin, there has been little or no must at least get the cost of pro¬
change in dairy products prices. duction.
In Superior it is expected that a

Economic

(2)

price 16

sense

common

price 14

Buda

sense

Recent price 30

Pol!ak|l:'-}|

Recent price 17 %

pell

Trading Markets in

con¬

Analyses

industry has been al-

-5

■

request

Consolidated Industries, Inc.

For Banks & Brokers Only

International Resistance Co.

Mats.

Teletype BS 850

MARKET

TRADING

RALSTON STEEL CAR CO.

Kobbe, Gearhart & Company

-—1—1—11 AFFILIATE: CARL MARKS & CO. Inc. CHICAGO—

incorporated

Members

,45

Vein York

NASSAU

-•

Security. Dealers

NEW

STREET,

PHILADELPHIA

TELEPHONE

We specialize in all

Felt Co. Common

FOR DEALERS:

New York 4, N. Y.

50 Broad Street

St| Boston

ret CAPt 0489

SPECIALISTS

COMMON STOCK $10 PAR

Association:

YORK

TELEPHONE

Enteepeise 6015

REotoe 2-3600

Stock

new yobk

ufacturer

BELL TELETYPE

1-570

this
of

well-established
FREIGHT

favorable long-term

man¬

CARS

outlook for

has
earn¬

ings and dividends.

Insurance and Bank Stocks

Mines

Selling Under 13

Industrial Issues

Lamson

Investment Trust Issues
Public Utility Stocks and Bonds

Corp.

Keyes Fibre Common

unless

same

grave

omy.

FOREIGN SECURITIES

pro-,

when necessary;

(-.AM, MARES 4 P.O. IKC.

only

system;

State

"Old Shares"

are

get

A test period for the free

REORGANIZATION RAILS

Lithomat

duction. When they are not need¬
ed }for that: purpose, there is no

148 5tikte

Jones

t ommon, sense

that: subsidies

porting the various points which I

Ceraseal Chemical Corp.

Haille

of its

Teletype—NT. X. 1-971

Trading Markets

American

it inters

emergency,

sup-

American Time Corp.
HAnover 2-0050

guise of

con¬

rush

gov¬

play favorites

quantities of of our own Nation, but of the whole

duce

necessary

my own

not:

have stated: namely,

In this situation,1 believe that the ■frZ V*

American

folks and

many

ganizations in

should not

brought back under

other

ceived

economy

dairy

and

re¬

charges, depreciation

that, in

say

telegrams

communications which I have

patriotic

population, but

our

who have been

maintenance

that there be reprinted the text of
numerous

demand that

with its citizens^ when under the

demon¬

integrity without

remarks,

en¬

terprise should he given a reason¬

Michigan Securities Section ap¬
pears

the

action^ QPA has been killed,

strate

and Missouri

because

386

Markets-

Walter Whyte

(a) I believe that in view of the

354
Corner..,.... 362

Salesman's

Securities Now in Registration
Tomorrow's

342

376

Governments

Utility Securities.

Public

summarize

now

present position on OPA?

'•;,*'

360

Funds

..May I

•

reprinted,

It has once again demonstrated his capacity to

demonstrated

(b)

of racketeers. It has demonstrated

index

lord

tenant.

sidies.
The American

there

establishing neces¬ why dairy products should be kept
sary and:equitable :rent controls free from price controls: and sub¬
wherever necessary.
I call atten¬
sidies.
tion to the > fact that equity is
Following this insertion, I ask
necessary in the case of the land¬
adequacy

costs and fixed rental ceilings.

OEA'a bureaucrats and other pai;- •in its buying.
-lor pinks

(b)

(Continued from page- 347)

fair: play

and

milk price advance of IY2 cents a
a real chance to prove or
• y/.'/:i
disprove the valucof free supply quart; will occur. •• }
and demand,,
V:} '!:• y;'yv
i: Iii this connection:; I t. ask that
•
lowed

TEXTILE SECURITIES |
a New Eng. Market

Merrimac Hat Common

LERNER & CO.

Securities with

Thompson's Spa

Inactive

Specializing in'XLnlisted Securities

Frederick C. Adams & Co.

Ralph F. Carr & Co., Inc.
*;• 31 Milk Street, Boston 9, Mass.'';'-;'-

10 Post OfBee

Securities

Square, Boston 9, Mass.

Telephone Hubbard 1990.

Specialists in
New England Unlisted Securities

Available

Circular

Teletype Bt 69.

Bank—Insurance

24 FEDERAL STREET, BOSTON 10
'

Established in 1922

Teletype

Boston

New York

Hubbard 6442

Hanover 2-7913

•

BS 328 I

Tel. HANcock 8715

Tele. BOston 22

Public

.Utility—Industrial—Real Estate
Lumker & Timber

Grinnell

For Dealers

Sunshine Consolidated

We haves

Pressurelube, Inc.
U. S. Radiator,

reports

prepared special
on

several

Bonds, Preferred and Common Stocks

for

retail ''distribution.

^General Products

Corp.

^Susquehanna Mills

Empire Steel Corp.

low

priced situations attractive}

Pfd.

*Seaboard Fruit Co., Inc.

BOUGHT—SOLD

—

QUOTED

*Prospectus on request

Plomb Tool
-

inquiries Invited

REMER, MITCHELL & REITZEL, INC.
208 SOUTH LA

w. t. bonn & ca
120

Broadway

New York 5

Amos Treat & Co.
40

Telephone
Bell

COrtlandt 7-0744

Teletype

1-886

Wall

St.

BO 9-4613

New
y

York 5, N. Y.

Tele. NY 1-1448

WESTERN

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4
•

•

PHONE RANDOLPH 3736

BELL SYSTEM TELETYPE CG-98?

Hill, Thompson & Co., Inc.
Markets

120

and Situations for Dealers

Broadway, New York 5

Tel. REctor 2-2020

Tele. NY 1-2660

Full text of Commercial and Financial Chronicle : July 18, 1946, Vol. 164, No. 4508, Section 1

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