Full text of Commercial and Financial Chronicle : June 11, 1953, Vol. 177, No. 5228

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UNIVERSITY
OF MICHIGAN

jun 15 1953

PUBLIC UTILITY ISSUE

MSMSJ UMMIUMnm

1 >:■•■•

Re?. U. S

Volume 177

Number 5228

New York

Pat. Office

Cents

Price 40

7, N. Y., Thursday, June 11,1953

Copy

EDITORIAL

Atomic Power and the

Progress and Prospects
We See It

the part of Washington commenta¬
tors to determine and to explain the current sta¬
tus of what is labeled "the Eisenhower program,"
are the center of attention almost everywhere.
The Washington scene is hardly unprecedented,
but it certainly is giving rise to a medley of con¬
flicting and confusing diagnoses. On more than
j

Efforts

Of Elechic Power

daily

newspaper an
reader with the

the

By WALKER L. CISLER*

Retiring President, Edison Electric Institute

President, The Detroit Edison Company

President, Atlantic City Electric Company

Chairman, Edison Electric Institute Power

Retiring Edison Electric Institute President reports

developments of past year in electric power industry.
an
adequate power supply ahead, despite
rapidly increasing demands, and holds electric industry's
progress has become synonymous with national prog¬
ress.
Calls for a sound water resources development
policy, and pleads for fair competition from government
proprietary business. Concludes "by our example today
of better performance under free enterprise there will be
assurance of a free society tomorrow."

account which would leave
impression that those who

"Picketing" Comments

After praising work of Atomic Energy Commission, Mr.
Cisler points out we are reaching point where atomic
fuels for electric power may be possible on commercial

basis, and competitive industry should play part in bring¬
Says it is responsi¬
bility of electric industries to determine how atomic fuels

ing its vast capabilities into being.

may fit into generation of electric power, and reviews
technical, engineering, economic and financial problems
involved in this development.
Gives data on energy

much

Much

greater responsibilities.

would for

the

few matters

PICTURES

depth

that I feel

The questions

are

within

time

group

Commission

should

send

Continued

page

ISSUE—Candid

war¬

the

who

atomic

control of the military authori¬

In the

intervening

years the Com¬
discharged its responsi¬
bilities wisely and well. It recognized the fact that in¬
evitably atomic energy must be an important factor in

has

Continued

by Mr. England before the Twenty-First Annual Con¬
vention
of
the
Edison
Electric
Institute,
Atlantic City, N. J.,
June 1, 1953.

THIS

under

and

♦Address

that

came

ties.

without

that

fervently believed
energy
development
should continue under rigid secrecy

have

them?

and

the

mission

sometimes asked why do

whom

and

November,

both

Walker Cisler

conventions

time.

Commission

came
into being
1946, and on Jan. 1,
1947 assumed a complex organization
hastily built up as a wartime activity
and devoted almost entirely to mili¬
tary nfatters.! And there were many

worthy of attention.

are

The

Why Do We Have Conventions?

page

greater

short

ical, more businesslike, and more
imaginative
private
power.
Our
companies have never been finan¬
B. L. England
cially stronger,
service-wise more
capable and earnings-wise more at¬
tractive than they are today. I want to touch upon a

another

Continued

with

opment to its present position in so

understanding because of these op¬
posing forces. We know that the an¬
swer to
"cheap government power"
is cheaper, more 'reliable, less polit¬

cripple or wholly
destroy the President's plans are rapidly gaining
in strength and are likely in the end to leave the
White House impotent and embarrassed; on the
same day in another part of the same edition of
the same newspaper, he has discovered "stories"
or analyses
by equally well known correspon¬
dents saying that all this that is apparently
threatening the President's program is no more,
or
certainly little more, that sound and fury
one reason or

future

of atomic fuels for the genera¬

use

first to rec¬
ognize the part which the Atomic Energy Commission,
and particularly its present Chairman, Mr. Gordon Dean,
have had in bringing this new devel¬

dustry has been undermined by the
growth of socialistic policies and the
20 years of attacks by proponents of
government power. But I, for one,
believe we grew strong, we recog¬
nized our weaknesses and are facing

industry, finance, governmental and labor circles.
The symposium, the "Chronicle" believes, should be
extremely helpful in clarifying thinking on one of
the most important public issues of the day.

discussing the

tion of electric power, it is most appropriate

has been said about the way our in¬

of atomic fuels.

resources

Today the electric industry in the United States has
great opportunities and along with these opportunities

Starting on page 3 of this issue we present some
expressions of opinion received in connection
with the "Chronicle's" symposium on the question of
whether the Taft-Hartley Act should be amended
with respect to picketing. As was true of commen¬
taries previously published, those appearing in to¬
day's issue represent views of individuals prominent

Survey Committee

Forecasts

occasion of late the citizen has found in his

one

Electric Industry

By BAYARD L. ENGLAND*

page

address

♦An

by Mr. Cisler before the Twenty-First Annual Con¬
the
Edison
Electric
Institute, Atlantic
City, N. J.,

vention

June

1953.

shots taken at the 29th Annual Field Day of the

Bond Club of New York on June 5 at the Sleepy Hollow Country Club, Westchester, N. Y.,
appear on pages

25, 26, 27 and 28.

State and
in

WESTERN

U. S. Government,
State and

Municipal

Securities
telephone:

Municipal

OIL & MINING

Pacific Coast &

Bonds

Hawaiian Securities

HAnover 2-3700
Direct Private

Wires

Chemical
BANK & TRUST

COMPANY

Bond Department

14 Wall

THE NATIONAL CITY BANK

Street, New York, N. Y.

Members of

Exchanges

ESTABLISHED

Ur nCW

lUnn

Salt Lake City
San Francisco

•

Los Angeles

Boston

•

Chicago

Bond

Honolulu

of Canada,

Ltd.

T. L. WATSON & CO.
established

1832

Members New York Stock Exchange
American Stock

Circular

Exchange

Request

Active

Banks

and

Brokers

Denver

Los Angeles

Spokane

Orders

CHASE

BANK

NATIONAL
OP THE CITY

OF NEW YORK

Cities

Executed

CANADIAN
BONDS & STOCKS

SECURITIES
Commission

THE

Maintained

Markets

Dealers,

CANADIAN

Commodity Exchange, Inc.

Dept. Teletype: NY 1-708

YORK CITY

and 10 other Western

Net

Ford Motor Company

1915

50 BROADWAY • NEW

J. A. HOGLE a CO.
s Members of All Principal Exchanges

AC MCU/ VADIf

Principal Commodity

and Security
;

Co.

Dean Witter

Public Service Co.
of New

Hampshire

COMMON
All

Analysis upon request

Canadian Exchanges at Regular Rates

Over-tke-Counter Trading Dept.
DEPARTMENT

CANADIAN

H. G.

BRUNS
DIRECT

Hardy & Co.
Members New
Members

York Stock Exchange

American

30 Broad St.
Tel. DIgby 4-7800

Stock Exchange

New York 4
Tele. NY 1-733

WIRES TO

MONTREAL AND TORONTO

Goodbody
50 Broadway, New

York 4, N. Y. r

Telephone WHitehali 4-6500
Teletype NY 1-1843

Bridgeport

Perth Amboy

Co.

ESTABLISHED 1891

MEMBERS NEW YORK STOCK EXCHANGE
115

BROADWAY

NEW YORK

Dominion Securities
grporaxkm
40 Exchange Place,

NORTH LA SALLE ST.

CHICAGO

Teletype NY 1-702-3

New York b, N. Y«
WHitehali 4-8161

ira haupt&co.
Members New York Stock Exchange
mnd other Principal Exchanges

111 Broadway,
WOrth 4-6000
Boston

N. y. 6

Teletype NY 1-2706

Telephonei

Enterprise 1810

y r r

•: ■,

■*

11A u-JJ-iO.V'

(2510)

ci*v"

The Commercial and Financial Ci
'

!:'•

•

i/%le

?*;n;

Thursday, June 11, 1953

'■».

•••'-.

_________

The

POSITION and

Security I Like Best

TRADE

Phillips Petroleum*
3.70/83

Southern Natural Gas*

This
Forum

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

participate and give their

reasons

for favoring

particular security.

Week's

Participants and

Their

Wheeling Steel Corporation—Leon

Levy,

(The articles contained in this forum

41/2/T3

they

are

Air Products

be regarded,

as an

intended

not

are

be,

Partner, Oppenheimer &
Co., New York City. (Page 2)

nor

offer to sell the securities discussed.)

Albemarle

Colorado Interstate Gas

Iowa Southern Utilities

Partner, Oppenheimer & Co., N. Y.
Members New York Stock Exchange
Associate Members American S. E.

Manufacturing
Stock — Berkeley
Richmond,
Va.

Morris Plan, Pfd.

Southern Union Gas
request

sells

ratio

and

its

Associate
American

Exchange

120 Broadway, New York 5
BArclay 7-5660

value

than

other

any

leading steel
At

company.

yields

Teletype NY 1-583

Rights & Scrip

This

Leon

during the 1930s.

high

profit margins

products,

imprbvement since the

ffiPONNELL&ro.
Members
New

120

Exchange

Stock

gins

Exchange

Stock

York

American

of increased

Before World

industry

BROADWAY, NEW YORK 5
Tel. REctor 2-7815

War

little

were

the

war

the
is a

efficiency.

profit

mar¬

than

better

the

contrast,

three

past

Wheeling Steel
down

average.

during

looking

are

for:

Preferred

years

able to bring

was

Alabama-Tennessee
Natural Gas Co.

Commonwealth Natural

hard

believe

Dan River Mills

Moore Handley Hardware Co.

Scott, Horner &
Mason, Inc.
Lynchburg, Va.
Tele. LY 62

LD 33

Pocono Hotels Units

Cambridge Bldg. 3s 1953
Leeds & Lippincott Units

Dredging Common

Bush Terminal Bldg. Common

Transportation

Samuel K. Phillips & Co.
Stock

Exchange

Pennsylvania Bldg., Philadelphia
Teletype

N. Y. Phone

PH 375

COrtlandt 7-6814

$ 1 8 2

contributes

stability.. Its sales

less
cyclical than those of
basic steel products. In fact, dur¬
are

ing

the

gether

depression, earnings to¬
depreciation always

with

exceeded

the

expenses;

experienced

cash

loss.

however, profits

year,

held

company

were

back

share,
has

other

tractions,

looking

at¬

because

government

1856

Members

Stock

New

Exchange

Stock
Cotton

York

Commodity
Chicago
New

Orleans
And

Exchange
Exchange

Exchange,
Board

N. Y. Cotton

Cotton

other

Inc.

Trade

Exchange

Exchanges

Exchange Bldg.

NEW YORK 4, N. Y.
CHICAGO

DETROIT

Common

bemarle

Co. 6%

company

until

and

Old

Common

Gehsten & Frenkel
Members

150

Security

Dealers Ass'n

Broadway

New York T

Tel. DIgby 9-1550

Tel. NY 1-1932

rec-

organized in

was

recently

earnings
cyclical and comparable in
and downs with other paper

such

you

Missouri Pacific

companies.

LAMB0RN & CO., Inc.
99

WALL

STREET*

NEW YORK

5, N. Y.

highly cyclical periods in the
industry are not likely to

paper
Berkeley

Al¬
Paper

William*

Manufacturing

preferred at current

mar¬

There have been

repeated.
new

many

ered

recent

been such
per

uses

there has
amazing increase in

capita

use

SUGAR

years,

fallowed

board

of paper discov¬

paper

and

such

Raw

—

Refined

—

Liquid

paper

huge

tion

prohibited

Wheeling

Steel

from supplying its own Fabricat¬

ing

Division

with

full

$125 million

PITTSBURGH

GENEVA. SWITZERLAND

within
all

and
trees

are

steel

the

become

15-20

been

Should the

its

plants,

South

where

merchantable

Some timber lands

years.

have

reach

easy

cut

three

over

new

times.

method for mak¬

ing chemical pulp that cuts wood
ize,

to 50%

would

reserves

material¬
automati¬

//Industrial

D.
the

Bulletin"

Exports—Imports—Futures

DIgby 4-2727

re¬

improvement

"Continuing

research

has

and will contribute sub¬
stantially to its future growth.
Despite the advent of plastics and
other

material, "the pulp and
industry
ranks
sixth
in

new

value of goods produced, with an
annual output worth $6 billion.

printed kraft, wrapping, con¬
verting and specialty kraft papers.
(2) Hollywood, manufacturing ab¬

Annual

sorbent

much

paper,

plain

consumption
of
paperboard
is
now

and

paper

about 31

million tons, 14 times as
in 1900.
Some experts

believe that it may reach 42 mil¬
lion
tons
by 1960.
While sales

blotting. (3) River¬
side, manufacturing asphalt, lam¬
almost entirely out of retained
inated, waxed, saturated and other of some paper products are closely
earnings and depreciation. Senior water-proofed kraft
papers.
This related to population growth and
capitalization increased by only mill houses the
company's multi- business conditions, new develop¬
$22 million. Consequently, divi¬ wall sack
operation.
(4) Halifax, ments from research promise a
dends of necessity, have been
kept manufacturing
kraft, sulphate steady increase in the per-capita
low. They have
averaged little pulp and kraft wrapping,
con¬ consumption of many others.
over
one-fourth of earnings for verting and
"Packaging now accounts for
specialty papers.
the

past

three

necessity for

years.

But

the

conservative divi¬

All four plants are

dend policy will no
longer exist
by the end of the year.
fore,

Wheeling's finances are unusu¬
ally strong — working capital was

$76

and

million

Dec.

last

and

current

assets
were
almost five
times current liabilities.
Further¬

more,
cash

the outlook

for

large

inflow next year due to de¬
preciation and accelerated amorti¬

strategically

located with regard to raw mate¬
rial and to markets,
and, there¬

subject to economic con¬
Independent of either rails

are

trol.

trucks

the

company

uses

delivery to customers

made within

$6,300,000

few hours.

modernizing

both

can

Recent

and

ex¬

pansion program is virtually, com¬

pleted.
•

'
-....

New paper mill

about

■

■ i

45%

the

paper

used, with printing
papers including newsprint, tak¬
ing some 30%."
In

1949

chose

the

cut

paper

prices

industry

rather

than

production when demand leveled
off

but

strated

that

experience

Prospectus

request'

cutting does
not immediately stimulate demand
leads

rather

the

Continued

Gordon Graves & Co.
30 Broad

Street, New York 4

Telephone
"

expecta-

page

NY 1-809

410 Pan American Bank

Bldg.

Miami 32, Florida

N. Q. B.
OVER-THE-COUNTER

INDUSTRIAL STOCK INDEX
14-Year Performance of
35 Industrial Stocks
FOLDER

REQUEST
i

National Quotation

Bureau1

Incorporated

46 Front Street
on

Teletype

WHitehall 3-2840

demon¬

price

building at Hal-

and

paperboard

but

Bought—Sold—Quoted

ishing,

Plants are (1) Brown's Island,
manufacturing
natural,
colored

cover

Company

Common Stock

kept

the pulp and paper industry flour¬

paper

and

Oil

Little, Inc., May, 1953, carries
following timely comment:

cally doubled.

and enameled

Commonwealth

Arthur

and

regulations regarding steel alloca¬

is scheduled for virtual
completion in 1953. It was paid for

H. Hentz & Co.
American

Foote Mineral

large

outlook

outstanding

manufacturing

and

The

buy

and

new

Power Shovel

ups

stop

may

The

were

and

consumption

program

York

has

The

per

offices

ex¬

of the War. Unlike list of end products.
Its manu¬ expansion of productive capacity,
major steel companies which facturing
break-even
point
is long-term market growth is well
have greatly expanded ingot ca¬ around a low 60% of capacity.
assured and it is not at all likely
that the industry will cut selling
pacity, Wheeling Steel concen¬
Timber
reserves,
vital
to
a
trated on improving its raw ma¬
prices * to accelerate
growth
of
paper
company are
adequate to
terial supplies, reducing costs and meet all
consumption but rather fall back
present or foreseeable
on less than capacity
production;
replacing old, inefficient opera¬ future needs.
^The proficiency of
tions
with
relatively low cost its tree farming policies are such nor is it likely to be an industry
left "holding the bag when defense
modern ones.
that the company is guaranteed a
spending is cutback.
It is now a
Principal
customers* are 'the sustained, if not perpetual, supply
favored industry. In 1915 per cap¬
automobile, building and contain¬ of raw material. It does not meas¬
ita consumption of paper was 100
er
industries. The company also ure .its
reserves
by comparing
lbs. In 1952 it was 390 pounds. It is
distributes
a
large part of its them in size with the size qf
estimated that by 1955 we may be
finished products through jobbers. states, as some giant companies
using 33,000,000 tons of paper in
The Fabrication
Division, as well do, but Albemarle's are large, the United States.
as making for
are
economically
located
high profit margins, they

The

New

classic

Executive

Chief

1887

branch

our

Pfd.

ample

Whose current
Asset value

Marion

come

bemarle

wires

This

quirements.

Established

Direct

since the end

never

2039

Phila.-Balt.

Birmingham, Ala*
Mobile, Ala.

save only National company.
It is fully integrated growth in fundamental demand
improvement was from forest to finished product that, while some temporary level¬
brought about by plant and equip¬ and supplies source material to ing off may be expected in the
ment expenditures of $125 million customers
manufacturing a long near term because of recent major

Steel.

Last

Members

President Gottwald is

ord.

amount of $45
per

NY 1-1557

New Orleans, La. -

Albe¬
flight management.

is largely due to his
inspiration and initiative.
He is a leader and co-worker,
and, in good labor relations, Al¬

St., New York 4, N. Y.

said that three

the company

share,

Exchange

most

Gas Co.

3-6's

25 Broad

greatest of these was men.
marle has top

Stockholder.

earning

Stock

major company

Trading Markets

Phila.

once

man

things entered into the success or
failure of an undertaking—men,
methods
and
money
and
the

to net before taxes than any

American

very

Paying

per

York

company.

A wise

larger percentage of sales ket
priqe of $85 per share.
other
Albemarle
is. not
al marginal

indus¬

New

Members American Stock

HAnover 2-0700

making

value

the

semi-finished

reflection

you

and

tion of steel output manufactured
into

the

Members

of management that has
through.
He has traveled
the road all the way from laborer

Levy

in part due to the large por¬

are

Since 1917

fastest

and

one

$643:

are

the

Fourdrinier,

book

not

was

most mod¬

security of a
deep
rooted
aristocrat,
in
a
growing industry: With par value
of
$100
and

the widest in the industry.

While

widest

try,

WILLIAMS

Paper Manufacturing
Company 5% Preferred

Senior

profit

among

earnings to

Albemarle

efficient,

margins

would

Beloit

ern

and

new

high quality
shareholders more in line with sheet of paper at a low unit cost.
The start up of this machine in
policies followed by other steel
companies. The stock is listed on January, 1953, about doubled the
the New York Stock Exchange.
paper making capacity of the en¬

The

today

whose

This

Richmond, Va.

relatively low
cost operation

Specialists in

share.

ifax houses

tire

less

Wheeling
an

Bought—Sold—Quoted

Steiner, Rouse & Co

the

would appear justi¬

BERKELEY

well known is
that

facts

will amount to

year

share. Therefore

per

generally

are

rate

8%.

generous

What

Member

bring distribution

followers.

1920

Stock

price-earnings
larger discount from

book

stock

common

appreciated
by steel stock

Corporation
Established

Steel
lower

These

New York Hanseatic

charges next
over

fied in raising the annual dividend

Wheeling

Puget Sound Power & Light

*Prospectus

Steel

6% Pfd.
Williams,
(Page 2)

already

granted indicate that depreciation

management

Wheeling

Metal & Thermit

Michigan Gas & Electric

Certificates

zation.

LEON LEVY

Louisiana Securities

Paper

Co.

Brown-Allen Chemicals

Copeland Refrigeration

Alabama &

Selections

NewYork4,N.Y.

Number 5228... The Commercial and Financial Chronicle

Volume 177

(2511)

What Do You Think?

INDEX

Picketing

LlCHTOSTEin

B. S.

Articles and Nevjs

Page

AND COMPANY

Restrictive Credit Policy and the Banking Outlook
•

Additional

opinions, given

symposium

On
:

not the Taft-Hartley Act
should be amended to curb picketing.

question of whether

the„ cover

"Chronicle"

with

connection

page

21, under
the
caption, "What
Do \ You
Think?" attention was called
of

is, that

the

May

—A. Wilfred

Diversion of Stock

' truth" does not win every

Just

battle in the competition of ideas/'

who

also picket

property rights and civil liber-,
ties and thus should

be curbed,

just

(2) those who, holding the

poxt

and

opposite view, argue that pic\ keting
is an essential compo-.
nent
of the strike weapon to
]" secure human rights.
To help

clarify thinking on the subject,
the Editor of the "Chronicle"
invited brief comments on the
question.
Some of the cornmunications that have
ceived

been

given

were

re-

the

■i we

able to accommodate in

are

today's issue the following addi¬
tional

opinion.

expressions

Others will

given in subse¬

quent issues.

Committee
Labor and Public Welfare
Senate

Few would

out,

long run the competition.-in
views presented , by the pickets,/;

management and public opinion
generally will serve to bring about
'a better'solution than if picketing
were

completely prohibited.;.

•

Congress

the

•

■+>-'

vio-

desus-

boil

pec

STREET, NEW YORK

Haile Mines

a n

Articles

its;

—Walker

Incorporated

Taca

Corporation

Utility Industry /

Electric Industry

Cinerama Inc.

Cisler

Cover

...

Coal

Incorporated

Main Source of Energy for Electric Power

Expansion—C. N.

J.F. Reilly&Co.

Vfrants to Know

Chandler

—Marvin

Phillips^

Broadway, New York 6

9-5133

at Utility Regulation—Eugene S.

A New Look

•.

Cover

Generating Interest in Utilities—Ira U. Cobleigh

<$>
i

________

What the Security Analyst

•

Profits—J. R. Hartman

Building Up Utilities

is to continue
to
be
re-

picket

L v.

rela-

Lear
Business Under Our Competitive

•—-Bayard L. England

labor

Getchell Mines
18

System'—Hon. Sinclair Weeks_-^./

•

system

...

Lending and Municipal Bonds

Progress and Prospects of Electric Power-

Teletype NY 1-3370

Direct Wires

Loughlin. 15

Philadelphia

Los Angeles

Walter Sammis, President, Harold Quinton, Vice-President,

Electric Institute

of Edison

Electric Industry Should Take Lead in Improving Public
Relations—Charles

im-

Oakes

•

not

necessary

(More letters in "Chronicle""

More on Picketing
Walter P.

Reuther

use

these sanc-

.tioHS- most of t;e time, but the
riffkt to use them is essential to
the existence of collective: bar-

gaining. Absent the union's abil&Y to picket and strike,, and on

the

When does a reguia- no reai bargaining, because barpicketing overstep the gaining impiies power by each of
become an improper the parties to withhold assent if
infringement of a right of free the offered terms are not satis-

Sympcjsium

whether: Taft-Hartley Act should be amended

Delhi Oil

wi$f respect

Getchell Mine, Inc.

Policy of Federal Reserve 19

•

Cinerama, Inc.

Morris A. Schapiro Praises Flexible
..

».

picketing)

regulation.

•

»«>

•

Hycon Mfg.
Regular Features
Kerr-McGee

Cover

(Editorial)

As We See It

Deb. 4

U. S.

Business Man's Bookshelf

1968

Airlines, Inc.

Securities

Canadian

and Insurance Stocks

Bank

bounds

and

speech?

simple test

there is no
yardstick by which
an
answer
to this

course

find

can

difficult

believe,
however, that if picketing is kept
peaceful and orderly, it is a legitimate means by which individuals
may exercise their right of free
speech. Frequently it is virtually
the
only means available to a
group of persons by which they
can

WALL

Telephone: WHitehall 4-6551

1953

Second-Half of

____

Atomic Power and the

the other side of the table absent
proper
type the employer's ability to say "no"
and degree of
L0 anion demands, there could be
tions

Bodfish

—Morton

D.J&

by some other

t i

down to ques-

dogs

touch!

Reeves Soundcraft

query

equivalent to asking whether
collective bargaining is to be kept
or
supplanted
' T

bate

tion

will

Obsolete Securities Dept.

________

Newspapers^—Roger W. Babsori_—______

chief

issues

•

Dubious in

Now—A Fair Break for

whether the
right to picket is to be sustained

violence,

The

Smith

Voss

Outlook

of Industrial

Organizations, Washington 6,

obligation collective barprevent gaining,. It is

such

Alexander

and

cats

else

nobody

nce,«and .p lement
a
certainly goyr%Strike, are inernmuent -h aBT^&gral parts of
1

WALTER P. REUTHER
President,

pletely spected.
unco n trolled,
The rights to
can
develop strike, and to
mass

that

quote

Purchases to Stock Exchange

Block

Gold—Philip Cortney,-;

Urban Mortgage

com

into

CAN

"'/

••

picketing
picketing,

Mass

degree.

some

Interesting Tax Rulings—Victor R. Wolder__

also do I believe that in/;

the

deny, I- believe; that whether freeboth the right dom of speech

and the duty to regulate

______:

—W. W. Townsend

has

government
to

—Walter
Business

sumption that most of the time,
the long run, "truth" will win

Senator from New Jersey

Chairman,

•

HON. H. ALEXANDER SMITH

____

Building Trends and the Building Materials Industry
•

general philosophy anid system of free speech on the as- V'
our

"Chronicle" of May 28, on page

3; others in the June 4 issue
starting on the cover page, and,

The Price of

But just as"we sup-. ■"

causes.

CAN

^Considered—Harold J. King..

lines will sometimes
be respected in unworthy or un¬

feel

CAN

Generating Interest in Utilities—Ira U. Cobleigh—

subject

of thought on the
(1) those
that it infringes op,

Coronation

the

-.-

to two schools

of picketing:

May.

a-/— Roger F. Murray

must and can afford to take in the

protecting free speech.

;

—

Consequences

Outlook for Money Rates and Fixed Income Securities

this may in fact
occur, it is a risk we

interest of

Economic

The

though

sometimes

—Fred F. Florence

question. -1

make

their

views

known.

picketing is kept orderly

If the

(perhaps limited to x numbers in
a picket line) I believe that property rights and the right of a man
to work can be be protected.. Of
course it can be argued that since

exercises

opinion

public

violates

disabilities on picketing,
-Picketing is then part and pareel of the unions strength m collective bargaining If concerted
action is essential to fortify the
workers strength in support of a,
collective bargaining demand,
Picketing to proclaim this fact in
an effective way is equally essential*
Now as to picketing and prop-

lawyer,

but I do not understand that any-

picket lines, one has a "property right" not to
matter how orderly, have truthful statements made

crossing
no

the

From Washington Ahead

My answer to this

HA 2-0270

specialized in

—

—-

Observations—A. Wilfred May__

—

_____

Report

Our Reporter on

PREFERRED STOCKS

Salesman's

The Market

____

Corner.—

—.___

and You—By Wallace Streete

Security I Like Best

The

____

Railroad Securities

The State of Trade and

h0UR

_____

——~52

Offerings——-----•

:____

_____—

Industry.

By the author of the
HOW TO I

Washington and You__

best-selling

MAKE A KILLING IN

Members New York Stock

Exchange

;1 Drapers' Gardens, London,
land, c/o Edwards & Smith.

Twice Weekly

COMMERCIAL and

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FINANCIAL

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COMPANY, Publishers

BROAD

Boston

•

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Editor & Publisher

Subscriptions
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111.

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Our Reporter's

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Published

; -

MACKIE, Inc.

of the News—Carlisle Bargeron.... 10

Indications of Current Business

Continued on page 16

and

For many years we
have

Singer, Bean

about him. As a union officer and

rights

property

right to work.

Dealer-Broker Investment Recommendations

Einzig—"France's Devaluation Dilemma"

Securities Now in Registration

such erty rights, I am not a

great pressure in preventing peo-

ple from
picketing,

factory.
; y
Now, all of this may appear to
be verY elementary but it is a
P^je of wisdom that still needs to
be learned in some quarters if one
can iU(fge frorn the tendency
toward imposition of increasing

Events in Investment Field

Coming

for for¬

eign subscriptions and advertisements must
be made in New YorX funds.

David McKay Company,
Dept. 5

225 Park Avenue,

Inc.

New York 17, N. Y.

The Commercial and Financial Chronicle...

(2512)

expansion

Restrictive Credit Policy
And the Banking Outlook

country

our

securities.

that

will bring us higher standards of

living than

believe

ation at

have ever ex¬

perienced.

banker, in appraising prevailing situation,
reason to believe good business condi¬
for at least six months, but warns current

"tight money" policy of Federal Reserve should be pursued
a more cautious pace, since drastic changes have produced

Continue

for

The

psychological reaction. Calls attention to unevenness of our economic growth and advocates strengthening
the banking structure through more equity capital and careful
screening of credits. Adds business also should re-examine
its

international situ¬

The over-all

war

Russian

war

dominate

the

and

Korea,

not

lives

than

our

evi¬

little

the

dence

likelihood

It is

American

our

continue people upon which
economy.
There other values depend.

all

our

shocking reflection upon
to be fearful of
and to fear that a peace¬
a

intelligence

our

peace,

early ful solution of the world's prob¬
change of such lems would bring about such serimagnitude as Xous deflationary readjustments in

any

justify our tour own domestic economy that
believing ?it will create a serious period of
there will be depression, and be harmful to the
any
appreci¬ well-being of our
people.
War,
able relief •preparation
for war, and safe¬
from the bur¬ guarding > against
war,
are
de¬
den it imposes structive elements
in our econ¬
upon
us
in omy, destroying the wealth and
maintaining energy intended to be used for
and
F.

Fred

Florence

preserv¬

ing the

essen¬

the

tial
ments

President

require¬

riod

national

our

security.

and

Eisenhower

has

very

appropriately stated that his fore¬
most responsibility to the Ameri¬
can
people
curity.

While
look

their

national

se¬

might

confidently

to some

tremendous

diminution

outlays

tain
strong and costly defense
throughout the long years ahead

meet

any
seeds of

tions
'

have

that

even

national emergency.
distrust among

been

sown

peace

which would entail
of

na¬

deeply
is achieved,
long period

negotiation, it will still

rec¬

ognized that only in our inherent
military and
general
economic
strength and stability will we be
assured of

There is

could
of

the

prosperity
the

come

Peace

greatest
ever

pe¬

known,

greatest blessing that
to America and all

the people of the world.

Only
in periods of peacetime, when our
people pursue their normal lives
of

war,

can

the

maintaining the

peace.

nothing that the Amer¬

our

efforts

safeguard

the

very
lives of our people.
While there are
naturally inherent
risks in
expanding our economy
and in the utilization of our nat¬
ural
war

*An

the

resources

economy,
address

Illinois

maintaining

the risk therein is

Mr.

Bankers'

economy.
is
to
be

and

loans.
in

crease

banks

soundness

With
the

the

total

throughout

loans

the

in¬

great

United

States, which is a natural result
of the tremendous growth that has
taken place, it is now more im¬
portant
than
ever
before
that
bankers not be misled by the fine
record of collections in the loan
portfolios that they have been ac¬

the

American

cash

its

expenditures will
income

cash

billions

are

painstakingly

For

our

quite

country

are

orderly and

cautious

of time.

Na¬

Government; therefore, the

interests

involved

by more

dollars.

business

sounder basis than that of

transition

During boom periods the seeds
always sown for the difficul¬

are

ties

of the
succeeding eventual
downturn, and it is during periods
of

downward

fluctuating activity

in monetary policies. It would be
fine
if
in administering
to the

that credit and financial
problems
increase and multiply. If we take

income

tax and other payments patient you could bring about his
Treasury in the Spring of complete recovery overnight, but
year.
But in the interven¬ too drastic remedial applications
ing time the expenditure of such might cure the ailment, but leave

these problems into consideration

in the

full

fiscal

year

reduced

that

figure

the

heavy

the

tremendous

by our National
Government, which will require
borrowing
that ' will take our
gross national debt to the highest
figure in history; certainly. can¬
not fail to have a
stimulating im¬
pact upon' business during ;* that
period. Even assuming a peace in
Korea, expenditures of our Na¬

the patient in a state of shock.

sum

American

Banking

American

banking

has

able

cause

Sound

for pride in its

justifi¬
accom¬

time

American

full fiscal year at a rate
business, and the
approximately 5% of that requirements of our Government
on American
business, have been
presently prevailing.
largely financed by banks. Bank¬
We have a tremendously rich
ing has gone through these pe¬
and
resourceful nation, both in
riods, and met the requirements
material assets and in the inherent
of the great expansion that has
strength and innate wisdom of our
taken place, to where the loans
American people.
It is the pri¬ of the
chartered
banks
of
our
mary responsibility of all busi¬
country reached the unprecedent¬
the

nessmen

During the

1947

occurs.

the

Col¬
lector of Internal Revenue and the

Treasury

Department

the need for

for

bad

year

recognized

establishing reserves
in-banks, with a

debts

within

nesses

impact when the downturn

plishments. We have gone through
current reduction in Federal In¬
period
of
national
defense, come Tax. This was
embodied in
World War II, and then the post¬
the issuance of MImeo 6209
by the
war
period,
followed
by
the
Treasury
Department,
under
Government will continue Korean War, during all of which which
banks

tional
for

discharge of our daily work,
materially lessen their

will

maintain

their

busi¬

sound basis to be able

weather

serious

total

approximately

000,000,000 at the end of last

were

create

reserves

permitted

the

basis

their past

20-year loss experience
ratio, multiplied by present loans
outstanding, with a current ceil¬
ing

three

times

At the end of 1951
of

that

amount

only about 45%

all

had

basis

insured commercial banks
established reserves on" the

permitted.

understand

$75,-

why

number of

banks

year.

have

not

taken

is difficult to

such

large
country
advantage of the
in

this

changes

our

economy.

■

people desire more than a those billions of dollars in a war
just and honorable settlement of economy, as contrasted to an era
our
international problems with of peace.
The expansion which
its attendant
peace to the world, we have experienced would ap¬
but
in
our
ardent
desire
and pear
relatively small compared
prayer for peace we cannot afford with what could have been ac¬
relax

Administration

the

liquidity

periodic To have met the demands so
ade¬
opportunity to establish reserves
When
quately has been a great achieve¬ in
their loan account as
operate our businesses upon
provided
truly
great
achievements
and
ment, but to have met these de¬
under
the
that
sound
basis
we
need
not mands
regulation aforesaid.
expansion in this country take
within the framework of
Since the
be
alarmed
about
large losses that oc¬
the
future. our
place.
'
banking system, and yet find
curred in banks in this
Those who have made the most
country
that in American banking there is
With the great increase in pop¬
during the years 1930-33, on the
careful, painstaking and intelli¬ still
some
reserve
of
ulation that hds taken place in
lending basis of the formula
now
gent study of this country, its
being
this
county, and the conserva¬ resources and potentialities, agree power available to the sound busi¬ used, covering a 20-year period,
ness
tive appraisals that it will con¬
enterprise of our nation is it will
be seen that banks are be¬
that over the long pull
in the an even greater achievement. With
tinue
in
the generation
ahead,
ing
faced
with
the
situation
generation ahead, there is every loans at
we
are
assured of greater need
unprecedented high lev¬
evidence of a degree of prosperity
whereby their loan portfolios have
for our productive capacity and
els, and in spite of a firm mone¬
been expanded, while from this
that has not heretofore been ex¬
tary policy by our Government
ability. We have been negligent
year on the applicable ceiling is
perienced. The thing for us to
in the development of
authorities, there is still within
great high¬ do is to
being reduced. Sound banking
keep our houses in order, private
banking the ability to
ways
and
construction
of
new
policy and good business judg¬
maintaining the kind of policies adequately meet the
legitimate ment would
schools, hospitals, and other pub¬
dictate the use of this
in the administration of our af¬ needs of
American business. *
lic and private works needed for
reserve formula to the
fairs that will
highest ex¬
The
safely insure our
the
experience in the postbetterment
of
our
people
tent
permitted.
The
American
business to where it can go into Korean
period taught us that fun¬
which will create higher living
Bankers Association is on record
that great period with the
strength damental consideration of
standards.
supply strongly in favor of a
to achieve its fair share
further in¬
of the and demand are still
operating in crease in the amount of
We should visualize the poten¬
reserves
opportunities
and
development our markets, and that as long as
tialities
in
the
that can be accumulated in
expenditure of
fear

ican

national

our

the best

and

ent

their

funds for national defense or
war,
the lack of confidence
among the
more
important nations of the
world should cause us to main¬

The

mankind.

usher

without

forward
the

benefit

would

half

best

the

nerves,

first

the

tional

exceed

comparable to the risk of the

human

ernment's

will

ation,

is for

people,

commended in its desire to main¬

fiscal year beginning July 1, cur¬
rent estimates are that the Gov¬

financial structure.

own

times
our

well

current

our

months.

unfavorable

appraisal of the tain the purchasing power of the
prevailing situation there appears dollar, and the soundness of our customed to throughout this
pe¬
to
be
logical reason to believe money. At this time our National riod of inflation and
expansion in
that good business conditions will Government
is the really great which our
country has been going
continue for at least the next six borrower of money. The finances for an
unprecedented long period

there is logical

tions will continue

all
of

welfare
Business

Good

At Least Six Months

says

will

interest

categories than

President, Republic National Bank, Dallas, Texas
Prominent Southern

we have ever enjoyed
received
past, and greater develop¬ by cautious and thoughtful busi¬
in science and all other nessmen whose primary consider¬

the

ments

By FRED F. FLORENCE*

That would appear to

wholesome, and I confidently

Thursday, June 11, 1953

Florence

before

Convention,

Louis, Mo., June 3, 1953.

St.

that lie ahead.

the

immediate

war

does not

threat

hang

over our

all-out

order

maintain

heads,

stronger

banking

structure for our country.
Cer¬
and consumers will
tainly the Government should
rationally and allow normal
have
great
concern
about
the
Possibly one of the most sig¬ supply and demand forces to set
strength of the banking structure,
nificant subjects now before us the pattern of economic
activity. and it should foster and
encour¬
is the
Monetary Policy currently Many businesses have encountered
complished
for
the
betterment
age constructive and sound meas¬
being pursued by the Federal this fact in a period of
rising de¬ ures that would
of our people with those billions
permit banks to
Reserve System.
It is commonly fense expenditures, full employ¬
of
dollars
directed
into
con¬
grow stronger.
It should also be
referred to as a "tight
money, or ment, and record levels of income. the
structive channels.
pride of each bank, its direc¬
Certainly re¬ restrictive policy." It has
proven Their experience has engendered
tors
and
adjustments will take place and to be effective to
officers, to have the
a high
degree, the attitude of caution in viewing maximum
will have serious effect upon some
amount of reserves set
possibly more so in the reaction the outlook for the future.
aside for possible bad debts that
segments
of
our
economy,
but to same by the masses of our
with peace the over-all welfare
is permitted by Internal Revenue
Reasons for Exercising Caution
people than the Board of Gov¬
Department regulations.
of the American people will be ernors
One of the fundamental reasons
anticipated. As an instru¬
Authority under Mimeo 6209
genuinely rewarded by a sound mentality against inflation I for the necessity to exercise cau¬
strongly approve of its applica¬ tion is the unevenness of our eco¬ was a constructive step in the
tion, but I do suggest that the nomic growth. Not all industries right direction, but it should be
policy be pursued at a somewhat nor geographical areas can be ex¬ promptly augmented to meet risks

Drastic

"Tight Money"
Philosophy Needed

;

businessmen
act

inherent
in
the
cautious
unprecedented
pace.
Following pected to share in the progress of
"easy money" policy of pre¬ our country to the same degree, total of loans held by our banks.

the

vious

are

pleased

Administrations
for
the
past 20 years, the sudden drastic
changes have produced a psy¬

Chairman of the Executive Committee

Federal

see

that

Reserve

BOSTON

CHICAGO

Coojxmxtian

Street, New York

banks

naturally
varying ways.

Board

ket is maintained.

25 Broad

This will necessitate

increase

reserves

double the

formula to
more

than

reserves

national

welfare
in
which
our
regarding our economic
It is just sound busi¬ Government should have primary
ness
policy for us to take our concern.
downward
fluctuations
in
the
bearings, and calculate the risks
bond market appear
abrupt, and on
More Capital Funds Needed
the
course
ahead.
The
at¬
raise some question as to
whether
In Banking
mosphere of caution by bankers
it should be construed as
charac¬
Another important factor vital
is dictated by sound judgment and
teristic of an orderly
market, even
a desire to
keep banking's credit to our banking structure is the
under prevailing conditions. There
house in order.
necessity to increase capital funds
has been1 Some indication'
recently
to keep pace with the
great growth
This is the time for bankers to
of a slight
softening of the Federal
that has taken place in
scrutinize
loans, in-,
all
applications
for
Reserve policy in its
application credit
vestments, and resources. A bank's
with very

should

(Xnwiuum SecitailtcA

individual
affected

Therefore, it is the responsibility
presently au¬
chological reaction that does not of the lending officer of a bank thorized. In the end it will re¬
dound
to
the
to appraise
benefit
of
our
augur well for the over-all best
carefully the environ¬
ment in which his bank is
interest of our country.
*
operat¬ Government, and as a matter of
ing. It should be clear to all of practical application, is not any
The United States Government
us,
however, that this caution special favor to banking but is
bond prices should not be
pegged,
should not be the basis for alarm wholly in the best interest of our
but the

to announce the election of

Joseph w. Dixon
as

and
are

PHILADELPHIA

short-time

orderly

mar¬

Recent drastic

fears

well-being.

great

Government

care

and

special consideration to the inher¬

Continued on-page

Volume 177

Number 5228

...

The Commercial and Financial Chronicle

(2513)

million

Steel

The

The Economic

Production

spendings in April and May.
Boost

Electric Output

01 the Coronation

Carioadings
Retail

State of Trade

Trade

Commodity Price Index
Food
Auto

and

Consequences

Industry

Price

set-hack
a

continued

but

which there has
been long queuing-up at 10 shil¬
lings admission. And there is the
boom to television set sales (like
that from the American political

qualitative,

was

Analyzing attendance statistics in detail, concludes ~
spending largely represents mere acceleration in lieu of sizable net gains for years as a whole..
Cites various temporary inflationary stimuli to the economy." t
Notes importance nf TV, both as to set sales and interference K

slight

be moderately

higher than the level
:

and close to the near-record peak attained in.reLabor management disputes slowed output in some

cetn weeks.

Steel

ingot production last week averaged 99.6% of capacity
and was substantially higher than a year-ago when work stoppages
hampered output.
Strikes in : suppliers' plants cut automobile
production substantially the past week, but output is expected'
to rebound sharply this week.

LONDON,

after-looks

for

Abbey

conventions), on the instalment
technique. Confirming the infla¬
tion to consumer spending is the
concurrent fall in savings depos¬

with Coronation attendance.

lines.

sideshows

the

evinced by

Americans.

ago

year

real,

such

unassurable, fillip to consumer
spending; on eating, liquor, on
traveling to and from London, and

Mr. May at the Coronation in London notes greatest relative

increase in tourism and

industrial production last week suffered

Economy

supplied

interest, both quantitative and

Failures

J
V : Aggregate

the

Production

Business

The Coronation

By A. WILFRED MAY

Index

tourists'

pounds

its.

is fitting even more negative result, since
Among its economic phases also
"Chron¬ they indicate a smaller year-tois the push given to the building
icle" of this week's "doings-ofyear increase than the number- trades'
repair section.
Although
the-Queen" should confine itself of tourists. At 90 million pounds
there is full employment in house
to their rela¬ they will exceed
1952 by only
building with 300,000 starts an¬
tively un- 12%, against 1950-51 -s increase of nually attained, the repair end
glamorous fis- 47%. The disproportionately low has been
depressed. Also there is
cal a s p e c t s. receipts are largely due to, the
the stimulus given to the textile
,f'(T h _i s, o f shorter period of time spent by trade, in the production of extra
course, is not the visitors, as on the numerous Union Jacks. The official banners
to imply that cruise
liners standing
by espe¬ alone consumed 8,000 yards of
that

this

Eng.

—

the

report, to

Cease fire

in Korea

will

not herald

decline

the

steel

market, states "The Iron Age," national metalworking weekly, the
current week.
All signs point to a very high level of business

through the third quarter it adds, with perhaps a moderate de¬
cline (not.a recession) in the last three months of this year. Con¬
sumer
demand is believed virile enough to support production
of

than

million

110

tons

steel

1953.

•

The previous
105.2 million tons produced in 1951.

high for the industry was

any

negotiations by streamlined committees are reaching the serious bargaining point and may enter the home stretch
next week, this trade weekly further states.
The agreement will

c o

of the

reasons

steel

will

remain

hard

year

if there is

even

strike

Steel order books of producers are

major

with large carryovers

second

quarter orders.
Some of them
behind on important tonnage products.

are

Since

are

their

still

Mills

•

order

are

not

able

accept all orders

that customers

place—even for delivery three months hence, it continues. :

want to

Although major users are hopeful they will not have to rely
expensive conversion steel after August, they are not con¬
vinced their hopes will be realized, this trade weekly notes.

The

defense program

not the strongest factor supporting

market, since greatest pressure is coming from manu¬
facturers who are finally free to produce and sell all the civilian
the

steel

goods they can, declares "The Iron Age."

•

its market the

supply-demand balance will not come to rest on 100% of capacity;
it will dip below.
But that will not happen until the conversion

high cost producers have to give up charging
premium prices; mills have trouble filling their order books, and
new orders do not keep pace with
production and cancellations,
bloom

Coronation

any

British ship

competition.

sales,
In

"income

the

event,

any

the

t h

items, is surely in the black.

t,.
whatever
the
personal
grouches of the few Bevanites, a
Government

have

would

even

the

basis

construction

with

TV,

the situation — as
boxing and baseits

11—through

with

The

into

got

American

the

interference

attendance, by both do¬

citizens

mestic
For

wooden

and

foreigners.

cubic feet

example, people remained in

France

their

stands

lumber, the annex at the Abbey,

comfortable absorption of the pro¬

the

decorations, furnishings, fab¬

ceedings over the TV set in the

rics

(50,000 yards of rayon), car¬

Festival

its

Britain

two

years

with its catering to the Roy¬

ago,

alty.

10,400

public

appraising the stimulus to pets, 120,000 cushions and electric
dollar
and other foreign — ex¬
lighting totaled 1,438,000 pounds,
change earnings, your correspond¬ with another million
pounds in

...

—

has

fortunate

been

tq enlist

the

cooperation of tl)e British
Travel and Holidays Association, a
quasi-government
the

has

which

agency,

data

firm

regarding

actual number of past

the

visitors and

companies,

agents at home and abroad.
Like

Americans

statistical

The

firmed by my

Receipts,

tion

toric

000

seat

including
sales,

radiant

rode,

day
in

her

golden

revenue

vast part of the human

to the task

aggregated 513,-

juster, kindlier

pounds, leaving a net cost of

place—but

This cost figure

and

without

follow¬
that had hit

Automotive production last week began to rise again,

.v..

ing settlement the previous week of labor disputes
Ford and Chrysler.

much.

con¬

show that

A continued strike at

Borg-Warner Corp.'s Muncie, Ind., plant,

still hurting the output of Nash, Hudson, Studebaker, Willys and Kaiser, according to the agency.
was

and Chrysler
operations, where suppliers' strikes bit deeply into production and
cost losses of many thousands of cars and trucks," said "Ward's."
"Higher production hopes rest mainly on Ford

Corporate outlays for new plant and equipment this year may
exceed the $27,000,000,000 which was forecast last April according

by the United States Department of Commerce and the
Securities and Exchange Commission. One official estimated such
to

survey

expenditures might reach $28,000,000,000. That would be
000,000 above the previous high set in 1952.
The survey said plant and

;
new

records in the

second

equipment spending would attain
On a seasonally

400,000,000 in the second quarter and $28,700,000,000

of $28,-

in the subse¬

The yearly pace in the March quarter was

countries.

all

val

consumers,

says

evi¬

steel products are anticipated by

"Steel," the weekly magazine of metalworking.

recent flurry of advances

resulting from upward

adjustments in extra cards is about over,
are

the

believed

the

making.

;

„

from current negotia-

Continued

on page

ALFRED M.

MR.

vious year.

ERLICH

But in connection with the dol¬

result,

lars-earning

crucially

Canadian

limiting factor is that these large
increases to a great extent rep¬
acceleration

resent

have

would

that

come

(Brokers, dealers and institutions only)
Billing in U.S. funds if required

business
in

Securities

any¬

through the year. The full v
year's estimate for U. S. visitors is
way

16%,

24%

from

against
1951

Private wires to Toronto

1952.

and other principal

Canadian cities

increase of
And not

only England, but France, Spain,
Italy and Germany as well are

70 Pine Street,

New York 5, N.

Telephone: WHitehall 4-3262
Cable Address: Watwat

getting all-time high tourist book¬
ings.
The

Coronation's

stimulus

!to

functions somewhat

same

impact,

the

"Christmas

partially

WATT & WATT

bor¬

the

Members

flattening-out of the tourist

traffic

here

will

correspond

drastic January

lull in retail

.trade..,.:,,,..

The£

estimate

the

itures^ *>£ the 'visitors
-Vf:'

Jl'fij

Toronto Stock Exchange

Winnipeg Grain Exchange

Montreal Stock Exchange

Investment Dealers' Association
of Canada

'rot

^Spending Limited

These, it is expected, will follow

promptly upon any wage boost stemming

under the management

in U. S. visits over the pre¬

revisions in base prices

While

Incorporated

crease

June

increases

from

rowing from the future. The post-

This Week
Further price

are

than in trade fairs;

Trade"

Scheduled at Fractionally Higher Rate

19%

Americans

interested in parades
the 1951 Festi¬
Britain prompted no in¬

dently

the

Steel Output

WATT & WATT

10% from Eu¬

countries, and

ropean

th£ economy

$27,200,000,000.
>

total

of less than

crease

the formation of

We announce

May, about a quarter
"gate," increased a
40% over 1952; against an in¬

the

but

and third quarters,

adjusted basis, the scheduled outlays indicate annual rates

quent three months.

$1,500,-

number- of

The

April and
full

industry turned out 110,387 autos last week, 9% more
than the 101,466 in the preceding week and about 18% above the
92,956 in the like 1952 week, according to "Ward's Automotive
Reports."
The

however,

Americans.

expend¬
shows

JORDAN

STREET,

TORONTO,

gentle

changing

economic aspects very

the

family

of making the earth a

visitors from the United States in

authority.

and

coach

peoples, expressing the dedication

is, of course, well covered by

trade

all of these things may happen

through the ranks of her cheering

expenses

i'f

first-hand observa¬

the Continent,

from

1,925,000 pounds.

Parades

data,

entertainment

and

y,./

household, crowned,

royal

the

government departments.

careful future estimates based on

supplied by shipping
airlines
and
travel

Hotel

Truly:—Her Majesty on the his¬

outlays for the military forces, ex¬
penses

Paris'

lounge

lazy

George V.

For

ent

flaunting

by far the greatest foreign inter¬
est in the Coronation was evinced

and

put on just as elaborate a show.
Witness the elaborateness of even

before the end of
this year. But the end of the steel honeymoon will not neces¬
sarily signal an unhappy future for the industry, concludes this
Some

in
set

expenses—

the

visible

the

materials

of the

total
for

with

Coronation,

statement"

ever-controversial

The

addition to the swelling of its

The Income Statement

celebration of

ap-

b 1

c a

s
the gen¬
eral economy was adduced by the
4% decline in the country's proj-

airlines, at 38 million pounds,
will be only 9% more than last duction
resulting from the extra
year, because of the new United
day's paid holiday.
V
-V?
States, Italian and Dutch liners
which have recently
The Incidence of TV
come
into

British
occasion;
since it is quite generally agreed

gone;

points out.

1 i

are

important

information

does catch up with

steel industry

the

When

sions

May

Labor

already operating at capacity, the only way they can get
books current is to drop a full month's quota to
customers, this trade paper asserts.
.

they

all

cere¬

conclu¬

Our
W lUred

bunting.
Inflationary effect

and

national

are

practically filled

Most mills will enter the third quarter

undelivered

month

cted

sacred

get through

products through the third quarter.

was

nation days.
Fare payments

monials.)
the

that the defense
program is pretty well set, declares "The Iron Age."
Even if
the shooting stops, steel requirements will remain about the
same—at least through this year.
About 12% of industry capacity
will continue to be employed in filling these needs.
..

cially for the two or three Coro¬

with this most

authority.
most

mo¬

tivation

likely provide a wage increase of around 10 cents an hour; followed
by a price increase of about $4 a ton, according to this trade
Some

terialistic

Steel wage

ONTARIO

its
v

The Commercial and Financial Chronicle

(2514)

demand for investment funds from

have
and

elapsed
the

their

Federal

historic

1951, yet

March

bond market
.h i

story has

been

com¬

into

pressed
this

period

than

into

the

preceding dec¬
ade.

The past

.•four
have

months
set

particularly
last
the

pace

unfolding
an
erratic,

times

securities.

dis¬

dull

comparison,

market has been

haved,

Market Has

have

been

orderly,

and

•

the

well be¬

thoroughly

affair.

known

find

time

bonds

tions

been

become

has

market.

cash

given
present,
the

about

about the

same

ever,

amount.

was

the

securities from time to time.

explanation for

the rapid
yields is to be found
changed character of the

the

bond market.

ing the balance of the

For the most of the

Hous¬

course.

Government's

taxable

new

credit, and offered

30-year

3*4%

bond-

look attractive. By raising the rate
to 4y2% on FHA insured and VA

guaranteed

tutions

itself

funds.

The tendency then, in this

small

gathering

are

mortgages, the gov¬
ernment also has made it hard for

sav¬

rate which should pro¬
duce a growth in assets of $12 bil¬
lion this year.
While these insti¬
tutions have become tremendously
a

compete

for" nonbank,

period of high demand is for in¬
vestors
and

attracted

elsewhere

unresponsive

the

Treasury's offerings.
In summary, as
long as private
demand stays high and the Treas¬
ury is

also in the competition for

funds,

long-term

tinue to rise.

rates

will

con¬

Ultimately the sup-"

ply and demand situation in the
capital market will determine the
point at which an equilibrium is
established.

Taking

into account

corporate

bond borrowing, state
municipal financing, and real
size of the adjustment which has estate
mortgage volume, it would
taken
place, however, must be appear that for 1953 as a whole

attributed to

the
the

there is

fairly close balance be¬
supply of and demand;
the for long-term funds. This
approx¬

in which

manner

and

Reserve

Federal

and

additional factor:

aggressive

tween

the ltd

the

'Treasury have presented a united imate

balance

has

not

been

evi¬

return dent because of the acceleration
free market. While the Treas¬ of offerings stimulated by Treas¬
in

Dur¬ rfront

year,

not the

are

to yield up to 3% fully tax exempt
at the long end, do not make the

ings at

tinued to provide the market with
funds by 1 purchasing short-term

The

govern¬

ing bonds backed by the Federal

savings banks, savings and
associations, and pension
funds. We know that these insti¬

con¬

rise in bond

buyer

loan

what

Reserve

outlets

only competitors, of

tual

reached in March

Federal

institutional

Corporate borrowers

bond

ponderous mechanism of our
thrift system, composed of
the life insurance companies, mu¬

five
1951,
points to increase their yields by only temporary support was given
0.35% and a representative index to the bond market by direct pur¬
of municipal bond
yields rose by chases of long-term issues. How¬
serve

mortgages.

estate

ments.

during the last thirty years
amounted
to
fixed
prices, the
when, apart from war panic and
thrift institutions, which had ac¬
money crisis situations, we have
cumulated much larger holdings
witnessed so abrupt a change in
effective over extended periods of
than they really
wanted, could
bond prices. What occurred in the
comfortably meet private borrow¬ time, they cannot respond quickly
public utility new issue market be¬
nor
is there any important elas¬
demands and readily make
tween January and May is with¬ ing
ticity in the flow of funds over a
commitments for months ahead.
out precedent for periods of
steady
few weeks or months.
economic activity.
The withdrawal of support from
High quality
Consequently, the rapidity of
bonds, those usually rated AA, the Government securities market bond market changes, the lack of
sold to yield 3,25% in
January, came in two distinct steps, which 'continuity in prices, and the dis¬
3.40%
in February and
March, accounts for the change in the orderly
conditions which have
'3.50% early in April, and as high gradient of the bond market de¬
prevailed at times can all be
as 3.90% in May.
During the same cline. After the accord between
recognized as the typical charac¬
period, the
longest marketable the Treasury and the Federal Re¬
teristics of a cash
market. The
declined

had

good spread

prefers other

pre¬

There

convertible

some

real

and

Thus,

great

long as the Federal Re¬
stood ready to buy long-

Government

fac¬

have

agencies

the

large, was inadequate
vigorous expansion in

serve

not

the

financing in which bank credit
employed but it is not im¬
portant currently.
For a supply
of funds, the market must rely on

equipment outlays,
working capital requirements, and
real estate mortgage debt.
How¬

thrift

the

years,

prewar

was

plant and

ever,

has

very

meet

market

dominantly

pegging operations of 1947
The flow of savings, .al¬

though
to

buying, since the
are

during the wgr

leading
a
real'
appetite only for corporate obliga¬
and

reservoir

banks

since

and

bond

early postwar years,

and 1948.

Become

unable

World

term

Governments

Roger F. Murray
organized, but
extremely in¬
teresting market for fixed income

stock

Bond

the

Surfeited with gov¬

rough.

ernment securities

pro-

policy of the
monetary authorities is restrictive
rather than expansionary, the
tor,

modest increase in rates
was
permitted. Virtually indefi¬
nite expansibility was provided to
the
bond
market
by the well-

Cash Market

reached

Reserve

accord

The

only

there

commercial

When
private investment activity quick¬
ened

been

a n-

the

management

individual bond

War II financing purposes.

Forecasting no change in monetary policy unless business hits
a
slump, Mr. Murray finds current rise in bond yields attrac¬
tive to fixed income investors, while the incentive to buy equi¬
ties has been substantially reduced. Finds government bonds
in generous supply, with likelihood of increase in long-term
issues attractive to investors. Says preferred stocks are within
buying range, and, because of closing of gap between bond
and stock yields, fixed income securities are gaining in favor.
than two years
since the Treasury

for

frozen

was

debt

Since

meeting the small demand
for money, and yields declined al¬
most continuously until the rate
structure

complementing

of the Treasury.

gram

prob¬

lem in

Vice-President, Bankers Trust Company, New York

nounced

sources.

In the 1930s, there was no

By ROGER F. MURRAY*

Hardly

thereby

private

Outlook for Money Rates
And Fixed Income Securities

.Thursday, June 11, 1953

carrying

the

out

was firmly stating its inten¬ ury announcements, but it should
tight than it otherwise would have sion to get on with extending the become apparent asthe market
gested by current events include:
market because credit or its equiv¬ been by reason of a $0.8 billion 'maturities of the
debt, Federal completes working through the
(1) Why have the changes been alent was available when neces¬ increase in the Federal Reserve :Reserve-< officials
were
empha¬ congested new issue calendar.
so great, so
In my opinion, 1953 is
rapid, and so difficult sary to meet an expansion in the securities portfolio. Similarly, in sizing the fact that this operation
likely to
to predict?
*
v
;
demand for investment funds. In 1952 the market was eased to the
would be conducted without help witness a leveling off, and 1954
(2) What do supply and demand the
extent of about $0.9 billion of net in the form of market
some decline, in this
support,
aggregate de¬
1920s, individual bond buyers
factors suggest for the outlook? '
mand from private sources. What
System purchases of Governments.
were important and there existed
-r The notice given by the authori¬
(3) What will be the part played a
the Treasury and the Federal lieThis easing of the money mar¬
strong investment banking sys¬
ties early in the year as to what serve will
by the monetary authorities?
do is more difficult to
tem for the distribution of new is¬ kets
was
discontinued
in
1953, the program would be, accom¬
(4) What are the implications sues.
predict, but perhaps we can make
Also, the commercial banks however, and no steps were taken
for the various categories of fixed
panied by the Treasury's need for some educated *
were
surmises.
a
factor at times and their to assist Treasury refunding op¬
income securities, namely, Gov¬
money before the June tax col¬
■' l''
until
mid-May,
when
expansion of credit provided the erations
lection period, was all the warn¬
More Credit Restriction Ahead?
ernments,
municipals,
corporate
modest purchases of bills were
market with a degree of
"bonds, and preferred stocks?
elasticity. started.
ing corporate financial
officers
The actions of the
Treasury and
Meanwhile, the outflow
(5) Finally, how do fixed in¬ Salesmanship and bank credit of
needed wand they
went right to the Federal Reserve since the first
gold and the increase in cur¬
come
securities look in compar¬
•work. Only the time required for of the
combined to bring'out the supply rency in circulation were reducing
year have ,been entirely
ison with equities?
bank reserves.
So far this year, 'processing registration statements consistent with a program of
of funds so
effectively that bond
and the restraint of underwriters fighting the inflationary pressures
•An address by Mr.
therefore, the Federal Reserve has
Murray at the An- yields were in a stable or
declin¬
•nual Meeting of the Boston
followed a policy of permitting kept the whole year's new-monev generated by a budget deficit at a
Security An¬
alysts Society, June 4, 1953.
time of full utilization of re¬
ing trend despite the increasing market forces to restrict
credit, offer offerings from coming to
The program
-market before the middle of April. sources/
has also
Alerted to the fact that the Treas¬ been designed to postpone, if pos¬
some portion
of the high
ury would be a vigorous competi¬ sible,
level of capital goods activity to
tor for the stable flow of thrift
This announcement is neither an offer to sell nor a solicitation
of an offer to buy any of
next year or the year after, when
money, borrowers raced to meet
these securities. The offer is made
only by the Prospectus.
a
backlog in this area might be
their requirements as soon as pos¬
!
sible on the correct assumption highly desirable from the stand¬
point of economic stability. The
that the laggard would pay the
1

The

principal

questions

past

sug¬

fair

three

decades

amount

there

elasticity

was

credit

situation

was

made

less

ury

the

activities

higher

A. K. U.
ALGEMENE

KUNSTZIJDE UNIE N.V.

•

American Depositary Receipts
!

for

American Shares

American

of 20 American Shares for each

Chase National Bank of the

par

•

Receipts.

repre¬

value of 1,000 florins each

ordinary share

City of New York,

are to

be made,

Deposit

N. Y.

with the

of;

was

apd

Supply

borrowers

terest

rallies

and

de¬

reflecting the ebb and flow

new

corporate

borrowing.

gradu¬

was

ally established in the absence of
Treasury borrowing at long-term.
Under

these

offering of
30-year
>

obtainable from the Depositary.

have

A pre-

circumstances,
$1 billion of

even

3*4%

bonds

funds had
on

the

com¬

anticipated effects

rate' structure

borrowing. Thus

for

we now

eager

this should

desir¬

appear

able.

Rather, the goal has been
to permit rates to be determined
by the demands for investment
funds

period of peak eco¬
The results reflect

nomic activity.

The

new

a com¬

Administration-

has

been

quite explicit in stating its
willingness and intention to take
all

useful

private combat

have the

Treasury adding a portion of its
large requirements to the

very

time

the price for money set by
the paratively free market.

new

petitor for the limited supply
''

June 10, 1933.

Will

precarious equilibrium

Sub-Depositary, Nederlandsche Handel-Maatschappij, N. V.,

are

alike.

range,

Vijzelstraat, Amsterdam, The Netherlands.

Copies of the Prospectus

lenders

with intermediate

and the holders of

in the

Reserve

rates as its primary objec¬
tive, although some value is seen
in having higher rates in effect
Between June 1951 and the end
because they permit more room
of
1952, bond prices fluctuated
for easing rates at some future
within a relatively narrow

payment of charges as stated
Prospectus, either with the Depositary, The Chase National Bank of the
City of New York, at its principal trust office, 11 Broad Street, New York 15,
may

Federal

Demand Balance?

Deposits of ordinary shares

and

cash
market
react sharply. Once

clines
,

the

extent

year

dominantly

Where

the

be issued by The

Depositary under

Agreement dated May 14, 1953 between it and "A.K.U."
such

Depositary Receipts in registered form for American Shares

senting ordinary shares of "A.K.U." of
rate

this

rates

been taken to keep credit
tight and to compete with private
in the long-term mar¬
bound to
con¬ ket have actually been employed
fidence
was
impaired, the de¬ in a firm but not aggressive man¬
clines spread to all sectors of the ner. They seem drastic only by
market and the heavy volume of comparison with the long pursuit
new financing required pricing at of extremely easy money policies
a new level.
during the past twenty years. The
program does not have raising in¬

which it evoked from bor¬

sponse

rowers

(United Rayon Manufacturing Corporation)
V '

Thus

rate.

rise

the

of and the
Treasury have been quite
is at¬ effective in
checking any possible
tributable in
large part to the
tendency for a "confidence boom"
"open-mouth" policy of the to
develop.
authorities and
the
prompt re¬
The various measures which
the

begin.

available

measures

recession

High

one

the list of

should

these

measures,
ranking perhaps just
below tax reduction, is a material

bidding for nonbank funds. easing in the credit situation. The
competition has monetary
authorities
are
fully

result, the

Volume 177

Number 5228

.The Commercial and Financial Chronicle

prepared,

therefore,
to
reverse
completely the restrictive policies
of recent months if

business

the

Building Up Utilities Profits

downturn in

activity should become
clear, however, that

visible.

reverse present pol¬
icies simply on the basis of a fore¬

cast, hunch,
such

ent

long

return

picture remains strong, pres¬
policies will remain in effect,

be necessary

substantial

cash

deficit.

would

suggest that the behavior of bank
loans

will

the

most

reliable

usually
„i

..u

in the fall is

occurs

expected,

should look for

During the first 50
service

relaxation of

some

permitted

the

tnat the

hand, if the rise tends

to exceed seasonal

proportions,

the

nate

vide

from

the

keenly
prevailing

competitive conditions
in the capital markets.

appeared

taken

required.

generation

with

Off

ones

new

in¬

sales.

inflation

were

capacity

able

demand

for energy rose
material
shortages

and

view

(b) Postpones

vestment necessary.

(d) Improves public relations.

Increases

increase

the

return

before

economies

revising

economic

indeed

are

fortunate to be

in an industry the use of whose

ef-

produces

product

practices

such

situation,

there

was

time

This announcement is neither
'

*■

Much

bring

normal,
sharply
slowed

our

has

benefits that a kindly feeling
toward the company which supPlies the energy is most natural,

Then, too, as we carry on an.
aggressive sales program to encourage the use of appliances, we
developments which have
taken place tend to increase those resell
existing owners of these
cost factors which are influenced
appliances on the many benefits
The

rapidly

offer to sell nor

The

■

will be able to extend matur-.

ities in

tioning
size,

equipment of inadequate

dissatisfaction

increased

use

may
energy.

i
i

.'
■

Continued

solicitation of an offer to buy any of th§se Debentures.

._■1

longer-term

distribute

re¬

•

.%
If,

•'

is¬

modest effort to

absorb

Even

#•
.4

maturities

the

$150,000,000

carried

public debt would result
in a very large volume of offer¬
ings. On balance, therefore, even
the investor who is quite pessi¬
by the

General Motors Acceptance

Corporation

mistic about the business ou.ttlook
should

not

bull

expect a

market

Five-Year 4% Debentures Due 1958

in long Governments.
A
special reason

for caution
about the present level of prices
is the probability that the rise in
short-term

With the current high
- credit,
short-term

Due

1953

July 1, 1958

rates has not yet been

completed.

Dated June 15,

demand

Interest

payable January 1, 1951^ and each July 1 and January 1 thereafter

for

rates should continue to rise closer

long-term rates. This process of
adjustment, however, inevitably
secondary effects upon the

has

Price 100% and Accrued Interest

market for all Government securi¬

We have

ties.

seen

number

of occasions that the shifts in short
and

intermediate

rates

have

had

important secondary effects upon
the market for long bonds. Unless
the
anticipated tapering off of
business activity comes sooner
than I expect, there may well be
unsettlement

further

ket for long
in

ment

bonds

may

in the

word of caution is more
to

the

offer

mar¬

the adjust¬

however,

be,

Copies of the Prospectus may be obtained from only such of the undersigned as may legally
these Debentures in compliance with the securities laws of the respective States.

rates continues.

short

MORGAN STANLEY &

that this
applicable

trading desk than the in¬
The adjust¬

DILLON, READ & CO. INC.

vestment committee.

ments, still to take place may

CO.

THE FIRST BOSTON CORPORATION

KUHN, LOEB & CO.

well

of quite moderate propor¬
with what has al¬
ready happened.
Furthermore, I
suspect that we may be only a
few months away from reaching
the time when long Governments

'/prove

BLYTH & CO., INC.

EASTMAN, DILLON & CO.

DREXEL & CO.

tions compared

will

prove

definitely attractive
the long-term in¬

GLORE, FORGAN & CO.

GOLDMAN, SACHS & CO.

Incorporated

KIDDER, PEABODY & CO.

purchases for

MERRILL LYNCH, PIERCE, FENNER & BEANE

vestor.

Municipals
The

Need

Buyers

HARRIMAN RIPLEY & CO.

LAZARD FRERES & CO.

LEHMAN BROTHERS

SALOMON BROS. & HUTZLER

kind of a market situation

of new
in the re¬

SMITH, BARNEY & CO.

STONE & WEBSTER SECURITIES CORPORATION

created by a record volume
issues

clearly

seen

dismal trend for
municipal bond prices during re¬
cent months. Despite the fact that
sumption

UNION SECURITIES CORPORATION

present y'elds are attractive to a

Continued

page

June 11,

1953.

follow
Thisi

type of situation, however, is also

offer is made only by the Prospectus.

market which would be

wide

by kilowatthour output much less which they receive from them,
The
than those which are influenced
only
situation in which
increased use of our service does
approach- by kilowatt demand,
ing.-.when we will again have
In most cases the incremental not tend to improve customer
adequate reserve capacity.
This additional investment in distribu- good wilt is that in which an.
reserve
capacity will have been tion system to serve desirable new inadequate job has been done.
i installed at a unit cost well above loads from existing lines is rela- If a store owner relights but inthe system average and further tively low as compared to
the stalls only half as much light as
rate
increases may* be required average
distribution investment. he should or installs air condi¬
The

fairly sharp decline in

private borrowing, and the Treas¬

sues.

improvement of

ing equipment.

ready

deterioration in the gen¬

some

should be

ury

been

public relations,

•

has

effect

program, namely,

resorting

can

our

last

that too little at¬
given to this
aggressive sales

is possible

tention

eral

the

preceding background picture of: so rapid that •
the capital markets, the point oni we
found
it
which one can be most positive isi necessary to
that Government bonds will be^seek
rate
inavailable in exceedingly generous« creases.
Sales
to offset further inflation and to The incremental distribution and
supply.
This statement appears presented no problem oecause ihe provide a return on this increased transmission operating cost is also
true regardless of how'the busilow.
prosperity resulting from a pent investment
ness picture develops.
If the pres-r
' •
Increased sales of energy for
Rate increases which have been
ent very high rate of activity coil-/; *Aa address by Mr. Hartman before
granted in the past have been such uses that do not adversely
tinues, the. debt management pol& -.s°.n Electric institute, Atlantic
accepted by our ,customers affect the system load factor ap1CV
.
„,uu
~,„4ii
icy of the Treasurv will he nnr- ™e
of the Treasury will be pur
because they were in phase with preciably will produce increased
City, N. J., June 3, 1953
sued by competing with private
borrowers in the long-term mar¬
ket. If, on the other hand, there
is

avoids

necessity for rate increases.

increased
output,
already
been
done
along these lines and it is not
my purpose to discuss this phase
of the question.

ca¬

of the

net

down the installation of generat-

II,
however,the

necessary

reserve

hostilities broke out in Korea. The

World War

In drawing conclusions from the;

was
our

had reached 27%.

Before

Following
Government Bonds in Generous

which, by the end

reserve

the
.

to draw

war,

able

and. it

equipment

Rate

investment

fected

and

gross

in 'all departments to be sure that spread satisfaction. The customer
all operations are being conducted w^o buys a dishwasher, a dryer
in i the most efficient
manner
in or an air conditioner receives such,

our output at a rate faster
than we could provide generating

pacity

was

offset

crease*

units

to further rate increases.

creased

for

flation^ by in¬

;

Supply

(a) Increased

rate

It is our responsibility to an¬
alyze the situation most carefully
to" determine what steps can be
the

increased

aggressive
sales program
and accomplishes many things—

less

systems and

expand our

and

earnings

appears

future

net

return on the investment.

revenues.

Hold

demand for durable goods in-

position

effect

relief

to-

fortu¬

being

working together to keep the
money market tight and to pro¬

use of our
long series

utility

industry

should be prepared to see the Fed¬
eral-Reserve
and ;the
Treasury

rate; reductions,

the pressure on bank reserves. On

other

years of our

industry, the increased

—

reaction

Certain

than
i-

now

temporarily
anticipate a much

distribution

If the seasonal rise which

moderate

higher cost, the system investment
per unit of capacity will rise.

resorting to rate increases, Mr.

of; load conditions is

guide to the credit policy of the
future.

years

in-

checked

can

replace

each company work up a careful analysis of
various types of loads in order to achieve a load which will
improve net earnings. Points out this is a factor in improving
public relations, and urges more merchandising of electrical
appliances. Holds improvement of load factor is major re¬
sponsibility of sales manager and constant careful analysis

appropriate
with financing the

connection

investment before

The

going

been

Hartman urges

subject to whatever modifications
may

many

trend.

has

increases.

Asserting under present conditions it is responsibility of a
utility to examine what economies can be made to increase

the busi¬

favorable

some

reasonable to suppose,

seems

therefore, that
ness

start

may

now.

which

to
we

Edison Electric Institute

educated guess that

decline

months from

,for

Vice-President, The Cincinnati Gas & Electric Company
Chairman, Commercial Division General Committee

they will not

inflationary

flation

By J. R. HARTMAN *

It is

(2515)

WHITE, WELD & CO.

page

The Commercial and Financial Chronicle...

(2516)

Corporation—Analysis—H. A. Riecke & Co., Inc.,

Minute Maid

Mountain Fuel Supply

Dealer-Broker Investment

120

New

understood

that the firms mentioned will

send interested parties

the following literature:

Manufacturers—Analysis—E. F. Hutton & Company,

Broadway, New York 6, N. Y.

Booklet—Utah
ment

K, Salt

Utah,

Power

Wyoming

Idaho,

Colorado—

Casualty Insurance Company

—

Co., Pacific
Building, Salt Lake City 10, Utah. Also avail¬
able is information on Ute Royalty and English Oil.

High Dividend Payers—Leaflet—Bache & Co., 36 Wall Street,
New York 5, N. Y.

and

Power

Company—Annual

describing Ebasco serv¬
Incorporated, Department T, 2 Rector

Street, New York 6, N. Y.

New

Stock

in the

yield

and

National

York

National Quotation Bureau

THE MARKET... AND YOU

market

performance

Quotation

Bureau,

over

Inc.,

Averages, both as to
a
13-year period —
Front Street, New

Investor dissatisfaction with
the

Winning

The

Ira

Cobleigh — $2.00 — Dept. 5,
McKay Company Inc., 225 Park Avenue, New York
17, N. Y.
—

long-range outlook

tinues

Aeronca

Manufacturing Company—Analysis—Hecker
Liberty Trust Building, Philadelphia 7, Pa.

Alabama

Gas Corporation

—

Bulletin

—

Co.,

Leff Bros., 25 Broad

Street, New York 4, N. Y.
Badger

Paint

& Hardware
Stores—Memorandum—The Mil¬
Co., 207 East Michigan Street, Milwaukee 2, Wis.
Baker Brothers, Inc.—Bulletin—Eisele &
King, Libaire, Stout
& Co., 50
Broadway, New York 4, N. Y.

waukee

Canada
39

Southern

South La

Central

Railroad

Broad
Eastern

Oils

Limited—Bulletin—Leason

Salle Street,
of

Co., Inc.,

Chicago 3, 111.

New

Jersey—Analysis—Hirsch & Co., 25
Street, New York 4, N. Y.

Utilities

25 Broad

Associates—Analysis—Kalb, Voorhis

Co.,

Street, New York 4, N. Y.

Electric Bond & Share—Review—Ira
Haupt & Co., Ill Broad¬
way, New York 6, N. Y. Also available is a brief
review of
Transamerica.

Formbrite—Publication

B-39

Anaconda's new Formbright
sheet, strip and wire—General Offices, American Brass
Company, Waterbury 20, Conn.
on

made

evident.

in¬

Petroleums

Company,

available

15
an

Canada

Broad

New York '5, N. Y. Also
New Superior Oils of Canada

Limited.
Graham Paige Motors Corp.
William Street, New York

—

Bulletin

DePasquale Co., 55

5, N. Y.

Jujo Paper—Data in current issue of "Stock
Bulletin"—Nikko
Securities Co., Ltd., 4,

1-chome,

Tokyo, Japan.

Also available
Meidensha and Nippon Oil.
Lion Oil

are

Marunouchi,

brief data

Co.—Memorandum—Hemphill,

Street, New York 5, N. Y.

McQuay, Inc.—Report—Loewi
Milwaukee 2, Wis.]'
Miami

Copper

Company

—

Chiyoda-ku,

Ajinomoto,

Noyes & Co., 15 Broad

Co., 225 East Mason Street,

Review

Sutro

Bros.

Broadway, New York 5, N. Y.
Minneapolis, St. Paul
Bulletin

(No.

Co.,

120

Saulte Ste. Marie Railroad
Company—
129)—Smith, Barney & Co.," 14 Wall Street

KfiW Corp.,
Oil

ayailable are memoranda on Gulf
Mid-Continent Petroleum
Corp., Sinclair Oil
Corp., Skelly Oil Co., and Standard Oil
Co. of Ohio.

advanced

enough

look

cash
than

the

Troster, Singer

& Co.

Security Dealers Association

Trinity Place, New York 6, N. Y.

can

to help them. Gen¬

are

not

going down,
there anywhere
relief from the

armistice, what

can

but continued tension

profits appears to have many billions annually, to the
mounted sharply.
distress of the taxpayer, with¬
press

❖

Consumers

s!«

Are

out any

The factors in the outlook
for

which

relief in sight.
*

Optimistic

Benton

objective

"to

promote

understanding of the func¬
tions of the specialists' system and
have

❖

Exchange,

including all sections
membership and the in¬
vesting public."
The specialist has the duty and
responsibility of maintaining an
orderly market by narrowing the
the

gaps

between bids

debits

reveal

that

level of

tivity is

the

general business
as

ac¬

high as it was at
the top of the seasonal
peak
last
December, quite a re¬
markable, accomplishment. If

some

business

psychological fears over the
statistical background is fur¬
ther unusual at this

the year, for
about May
constitutes

season

normally from
to midsummer

one

the

few

are

Price, Evans & Go.
Formed in Toronfo
TORONTO,

nor

reasons

motivating their
pressure against the

—

Price,

act

as
dealers
in
government,
municipal and corporation bonds.
Officers are William H. Price, Jr.,
President,
and
Jenkin
Evans,

The

Jenkin

with

new

firm

Evans

is
&

Phila. Inv. Women

Plan Celebration
PHILADELPHIA, Pa.—The In¬
vestment Women's Club of Phila¬

delphia will celebrate the end of
their

that

the

new

shown

Ad¬

the

entirety.

Further Decline

There will

then

the

club

the

Tuesday,
be

will

buffet and
attend

Playhouse In The Park to
play

Bala

June

see

the

"The Male Animal."

A. B. Newman Now With

Scharff & Jones, Inc.
(Special to The Financial Chronicle)

NEW

ORLEANS, La.—Ariel B.

Newman

has

become

associated

Charles King Admits

Probable

potent. Wide swings without
statistical

backing

Scharff & Jones, 219 Caron-

not

On June 4th William H.
ter

admitted

Schus¬

partnership
in Charles King & Co., 61 Broad¬
way, New York City, members of
the American Stock Exchange.

only
prob¬

was

King Merritt Adds
(Special

Port¬

virtually in folios sufficiently solid not to
seems be panicked by mob rule, and

There

selling has been
Mr. Newman was
contra-seasonal adds weight delet Street.
formerly a partner in Weil &
to gravity of the situation.
Arnold.

wide recovery of last Novem¬ are
possible, but more
ber and December, now has able
than
otherwise.

been taken back

season

Club

30th.

with

Depressing

1952-53

Country

ministration;

Canada

Evans & Co., Ltd. has been formed
with offices at 366 Bay Street to

scared,

In the thin, regulated mar¬
only one other
place to loqk, and that is kets of today psychological
Washington. The expression considerations are especially

its

350 members.

Co.
Mr. Price was formerly with
Mills, Spence & Co. in Montreal.

Contra-Seasonal Selling

con¬
periods which really can be
investors counted upon to produce a
be looking elsewhere for
good strong uptrend. The fact

There

are eligible for mem¬
bership, and the association now

affiliated

to rising trend. Pur¬ were
dumped last week, di¬
by ultimate consumers rectly against the strongest
never have been better.
They upward trend of net earnings,
are
demonstrating full confi¬ both at hand and in prospect,
dence in the
quantity and of any group in the whole
stability of their incomes. market. The domination of

must

offers

specialists
has

chases

sumers

and

the stocks in which he specializes.
All regular and relief "Big Board"

stable

neither

with

relationship

the facilities of the

use

Vice-President.

❖

Thus the psychology of the
public is re¬
sponsible, and which it can marketplace
continues
ad¬
control, have remained on a verse. Even the rail shares

Bank

closer

those who

the

of confidence in the

eral taxes

ahead

firmly

general outlook will shift suf¬ ternational aid evidently is to
ficiently for the worse to de¬ be continued at the rate of

Tax Picture

Primary Markets

The

steady
price structure.

TAYLOR OIL

count upon

make Korean

attractive

risk.

constructive
investors

earnings on the international scene, in
which developed these
swings any event in sufficient quan¬
in the first
place have not tity to force armament spend¬
changed by significant pro¬ ing on a sustained wartime
portions, but the fear that the basis indefinitely ahead. In¬

DELHI

Members: N.

which

Profit-taking has been persis¬ ings before they can be spent
tent in
everything which has by the share owners. After a

the

KERR McGEE

Benton,

Organized in 1948, the Associa¬

they just cannot and neither is
anything exciting over the in sight any
second half of 1953, and per¬ intolerable burden of double
haps even longer ahead. taxation on corporate earn¬

Limited—Analysis—Burnham

Street,

analysis

nothing

dicates that

brass

General

was named

re-elected Treasurer.

was

STREETE

see

con¬

action of the market

David

the

Exchange. He
John J. Phelan, of Nash

Co.

tion's

4, New York.

Street

Specialists

better

Utility Stock Analyzer—Complete data on 75 public utilities—
Geyer & Co. Incorporated, 63 Wall Street, New York 5, N. Y.
in Wall

WALLACE

York

Co.,

Jones Averages and the 35 over-the-counter industrial stocks
used

elected President of the

was

Vice-President,
succeeding Leonard Wagner, of
Wagner, Stott & Co.; William A.
Coleman, of Adler, Coleman &
Co., was elected Secretary to suc¬
ceed
Kenneth
R.
Williams, at
Wagner, Stott & Co., and Thomas
W. Bartsch, of Travers &
Bartsch,

report—Vir¬

ginia Electric and Power Company, Richmond, Va.

showing an up-to-date com¬
parison between the listed industrial stocks used in the Dow-

Specialists

Haupt, head of Ira Haupt &

Thomas

Inside Story of Outside Help—Booklet

Over-the-Counter Index—Folder

the

are

Association

Electric

those

presented as
author only.]

N.Y.S.E.
Ira

National Life

with

They

Haupt, Pres. of

succeeds

Utana Basins Oil—Information—W. D. Nebeker &

Virginia

coincide

Ira

Co.,
Analysis

eocpressed in this
necessarily at any

not

analysis—Lerner & Co., 10

Hill Richards & Co.,
62 South Spring Street, Los Angeles 14, Calif.

Stocks—Brochure—First

those of the

9, Mass.

—

many

sight.

views

Chronicle.

Service Corporation — Analysis — Schneider,
Hickman, Southwestern Life Building, Dallas 1,

Telecomputing Corporation

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

ices—Ebasco Services,

[The

Texas.

Wall

opment does not yet appear

Sterling Drug Inc.—Analysis—Eastman, Dillon & Co., 15 Broad

Utilities—Study

Boston

Hampshire—Analysis—Ira Haupt &

Cement Company—New

will

of the downward devel¬

tom

time

Street, New York 5, N. Y.

McKinnon,

there

tough period while the sellers

article

Bernet

giving data on 88 companies—Carl
Loeb, Rhoades & Co., 42 Wall Street, New York 5, N. Y.

M.
Fire

■

Seismograph

L^Jce City 10, Utah.
&

runf

Gas, 62 Henry Street, Binghamton,

Post Office Square, Boston

Street, New York 5, N. Y.
Electric

Electric

State

Riverside

Light Co., P. O. Box 899, Depart¬

Stocks—Analysis—Thomson

Beverage

and

out

satisfactorily in the long

annual report—New

Gas—1952

Co., Ill Broadway, New York 6, N. Y.

Department of Admissions and Outside Supervision, Ameri¬
can Stock Exchange, 86 Trinity Place, New York 6, N. Y.
Resources—In

■

Electric

Public Service Co. of New

discussing associate mem¬

bership, eligibility, cost and capital requirements, and out¬
lining commission benefits available to associate members-

Area

■"

r -

Montreal, Que.,

West,

Street,

James

should1 work

work off their stock. The bot¬

Limited—Bulletin—L. J. Jackson & Com¬

St.

State

York

American Stock Exchange—Booklet

N. Y.

selective

sound

to be in
New

Aircraft

132

Ltd.,
Canada. ; •'"

pany,

but

Richman &

Britain Machine Company—Analysis—Bond,

New Calumet Mines,

he pleased

P. F. Fox & Co.,

5, N. Y.

New York

Broadway,

set

principles,

Co.—Special Analysis

Co., 37 Wall Street, New York 5,

Recommendations & Literature
It

Street, Philadelphia 2, Pa.

Walnut

1519

Thursday, June 11, 1953

to The Financial

Chronicle)

PONTIAC, Mich—Luke Arama
now with King Merritt & Co.,

Inc., 53

West Huron Street.

Number 5228... The Commercial and Financial Chronicle

Volume 177

(2517)

a
greatly increased ingenerating capacity-2.858,000 kw. at the 1952 year end.
875,000 kw. capacity is scheduled
to be added by the end of 1954.

nancing

Generating Interest in Utilities
By IRA U. COBLEIGH
Author of "Winning in

Some

topical

Wall Street"

Sustained investment in operat¬

AGC

opines that, here,
where

else

security
buyers have

many

run

Not

ity

of.

afoul

that util¬
commons

have been im¬

pervious

market
1

be¬

they

cause

haven't.
h

de-

ines,

They

had,

a v e

however,

lot

build

serves

new

will

that

and

substantial

most

important

financing.

For

able

were

bonds

1945-52
will

ican
in

mortgage

in the
bonds

same

to¬

factors day. And as for the commons, if
pitching for a given outfit has been paying out
them, that 75% and more of net, what lure
of

Ira U. Cobieigh

bound,

were

the

over

earning

it hold

can

shares?

due
these

Among

dividends,

course,

out

and,

power,

dividend increase

increase

years

propelling forces were (and are):
<1) steady increase in popula¬

possible

buyer

Gas

the

you

portfolios of

new

Of the New
a

like
may

nestles

many

of the

pacity in 1952 which

86%

total

considering the
year earlier was

While at 18 %, paying
the yield is roughly 6.5%
and the payout of 1952 net, a very
high 84.5%, another look is re¬
295,000.

$1.20,

For 1952 net, results represented only a 4%% return on

quired.

rate

base

here;

to expect

(closer to
from

the

rea¬

Here

again,

valuation.

Given

defenSeto'

from

vou

Jos. Dixon Appointed
William

Rosenwald,
of

Naturally,
em

all.

nely,

how-

ican Securities

can

Corporation,
Broad St.,

New

York

City,

have

announced the

election of

Joseph

inves-

brief

W.
as

Chairman of

kilowatt

can't

executive

the

cover

facts

c omm

ittee.

Mr. Dixon has

suggest that, in

might, however,

r e s

dent of Amer¬

de-

financial

Current

Board,

Dixon

this

Chairman
the

and E. F. Con-

tor's shopping list,
sketch such

by
Corp.

American Sees.

and allowing

sensible

switching

nffpn*P

defense to offense.

earnings from a 40% capacity
increase by the end of this year,
P. G. & E. would seem to belong
somewhere

find

von

u^ittingly

better treat¬

at the meters,

mav

something better than 4.7%

ment

favorable treatment

return, that is)
State regulatory body.
a

sharp*

for

clearly

and

has excellent

Power

good

because of the

one

out.

ought

ever, is a company definitely
serving rate increase so that it

ca-

quite

was

pay

earn

son

specific about
companies falling in the above
three-way category. It would be

slide over this

massive increase,

Central Maine

I'd rather not get

earlier criteria,

our

suggested. It added 60,000 kw.

the

1975

mMkerdefens« awfnV I
flipping Dow Jonef mSnbrh
if residential revenues nrennnrielate
Also if thl territor?.^
is zooming
1^ Florida
South
thl Luthwest ind
coast' then
m£ht
1

pansion of capacity would seem
to deserve.
At 37 y4, the yield
today is 5.38% assuming payment
of the $2 dividend.
For 1952 per
share net was only $2.31, so, by

look at Central Maine Power is

unbroken record

given considerably less attention
than its size, the territory and ex-

England companies,

capacity

low

Of the very large companies
Pacific Gas and iAectric has been

about Amer-

Electric.

and

management,

the common here (listed NYSE)
selling at 24, paying $1, and yielding a meek 4.1%,
tric shares

leading investment trusts.

the

above 4%

yield

rates and

split-

you

If
utilities

to know more

new

yield

These

want

and

way.

your

fine

dividend payments for 31 years
has risen im- give some investment substance to

dividends

the

along

ups

companies

good

3-3%%

era.

have

will

many

sell

income

stock

quality in

re¬

capital
in the
next couple
of
years—that utility is somewhat
vulnerable.
And of its problems
the

lot

generating capacity,
have to go to un¬

for

derwriters

adequate

net

tory,

most every¬
broken skein of declarations going
market, the
all the way back to 1910, with a

the

ing electric utilities equities dur¬
For
ing the past 30 years would have answer is a selective one.
provided a lot of insulation against example, a utility that has been
the headaches paying out generously, that has
failed

bigger dividends in the not
distant future. A growing terri-

pressively
from
$18,248,000
in
1946 to $27,340,000 in 1952 during
which time gross has doubled. As
a dividend payer AGC has an un-

house comment on the suitability of elec¬
equities for market defense.

power

tric

and

stalled

Joseph W. Dixon

addition to the above, you peruse

been

offi-

the pertinent data about Florida Cer and director of American Seconstructive to delineate
tion;
(2) improved plant effi¬
of course, add protection to the Power, Consumers Power, Dayton
curities Corp. since joining the
ciency and vastly increased ca¬ some companies whose foresight
$1.20 dividend and reduce the Power & Light, and Long Island organization in 1949.
pacity; (3) enormous increase in in financial planning and gener¬
percentage
of payout to
more Lighting.
demand
(electricity sales have ator
far

doubled

the last decade);

(4)

treatment

considerate

rate

construction, place
preferred position at

ment.

is, of course,

them
the

mo¬

true that

utilities
regulatory bodies, based on the the nature of electric
concept of a 6% return on fair continuously requires expansion
valuation; (5) virtually no credit to plant and capital since these

Appropriate increase in net would,

standard

Central

proportions.

qualities.

;

Houston
Lighting and Power
you pay your bill companies, being public monopo¬
plant closes, or your TV lies, can never make or retain net paid out the lowest percentage of
net in 1952 of any major electric
set won't even bring in station earnings sufficient to finance re¬
patterns; (6) aggressive nation¬ quired growth. So all must build, enterprise, a modest 54.3%. Genwide sales of electric appliances and all must, on fairly frequent
erating capacity was almost douhas trebled household juice buy¬ occasions, sell securities. But some
bled in 1952, a factor which should
ing in the last 20 years (television have both retained more earnings
alone has added $200 million a and
timed
their
financing and augur well for expanded earnings

in KW sales).

building

In addition to all of these forces

for forward motion, utilities have

that their needs

less acute.

are

ones

whose

And those

recognized

ties.

Even

defensive

will

give

up.

1932, when business generally fell
off 50%, electric sales revenues

The first
talk about

$12 billion in generating
plant expansion is planned in the
next four years (maybe we'll see

Field, Richards & Co.
(Special to The Financial Chronicle)

trary.

Ohio

CINCINNATI,
E.

has

Strautmann

—

This

electric^ generation by

electric power would expand 260%

ciated with

Co., In(?.

not an

ojjer

sell

nor a

solicitation of

offer to buy

of these securities. The offering is made only by the Prospectus.

I really wanted to

one

Texas Utilities but

was

out of deference

June 10, 1953

NEW ISSUE

regulations of

fense

sagged only 13%. A second de¬
quality has been the relative

facts

market stability of

instead

which

amine the prospectus covering re¬

utilities under
they tended to sell on a
yield basis somewhere betv/een
1% and 1% % higher than preferreds

the

same

property

the

SEC
will

cent

intimate

hereby

offering

financial

quoted and
exhorted
of

you

are

ex¬

common

new

interest

knocked

rates

this

nice

Worth,

hat.

plus

ferreds went

Wichita Falls, and Waco,
other communities in
rapidly growing Texas. Company
paid out less than 60% of net in

while,

dividends for

Utility bonds went down, the pre-

down, leaving, for a
lot of commons without

benefit

their

traditional

full

590

spectus and

1952.

see

the

Get

pro¬

for yourself what

advantage yield-wise over their a progressive watt producer they
seniors.; So in the recent weeks have, deep in the heart of Texas.
we have observed the price ero¬
American Gas and Electric, at one
sion and mounting yields of com¬ time the Tiffany item in the Elec¬
mons
portrayed in the accom¬ tric Bond and Share galaxy, is

panying table.
Having
current
we

taken

view of

this
the

bird's-eye

utilities,

are

to conclude that the second

Decca Records Inc.

40%, which offering, I
might
legitimately observe, no
doubt contributed significantly to

(which in turn sold on a 1%
higher
yield
than
the
bonds the decline in Texas Utilities re¬
ahead). This was roughly the re¬ corded in our table. Comment will
lationship which existed for sev¬ be limited to saying that this dis¬
eral years until this Spring, when tinguished company (through its
new and higher government bond
subsidiaries) serves Dallas, Fort
little equation into a cocked

318,625 Shares

the largest electric holding

CAPITAL STOCK
_

and now

nice question and the Chairman

will gladly accept an answer from

June 9, 1953, which rights expire at 3:30
Time,

the

floor.

Hearing

none,

Indicated

Comnanv

Dividend

company

Pub. Service of Colorado__»

Price

through

chase any

period,

%
.

may

Price

26%

$1.40

30%

2.60

51%

5.0

Subscription Price to Warrant Holders
$9.20 per

Copies of the Prospectus may be
writers named in

obtained in any State only from such of the several lander-;
lawfully offer these securities in such State.

the Prospectus and others as may

1.80

35 y4

5.1

1.20

24%

4.9

24%

1.00

25%

3.9

.70

13%

5.2

Laurence M. Marks & Co.

Reynolds & Co.

50%

Electric

Northern States Power
Tamoa

Elec.

Texas Utilities

-24

5.2

2.00

5.3

:.7o
_

„

Bachej& Co.
}

■

17%

5.0

16%

2.20

38%

5.7

34%

1.88

45%

4.1

40 y4

Bear, Stearns & Co.

12%
1

Long Island Lighting
Minnesota Power & Light.

■"

2.40

Pacific G. & E
*

subscription

offer shares of Capital Stock as set forth in the Prospectus.

6/5/53

Yield

Commonwealth Ed.'L

agreed, subject to certain conditions, to pur¬

unsubscribed shares and, both during and after the

stock, it

4.5

Cleveland

...

in the Prospectus.

earlier fi¬

Delaware Power & Light
Houston Lighting & Power-

;

com¬

is about to

common

3/31/53
„

serves a

offer additional

he has provided

a--

Shares
record
P.M., Eastern Daylight Saving

June 25, 1953, as more fully set forth

The several Underwriters have

diana and

though this

V::;

Rights, evidenced by Subscription Warrants, to subscribe for these
by the Company to holders of its Capital Stock of

have been issued

Michigan through Ohio,
Kentucky, Tennessee and West
Isuming some continuance of vis¬ Virginia, into Virginia. It boasts
ibly unbuoyant markets of late, one of the most progressive man¬
utilities will persist in the ten¬ agements in the business, presided
dency of their bids to fade? That's over by Mr. Philip Sporn. Al¬
defensive platoon quality of these
has been overrated; and that as-

Par Value 50tf per Share

v.;

population
of over 4,000,000 in an integrated
power grid running east from In¬
pany

...

;•

asso¬

Field, Richards & Co.,
Union Central Building.
Mr.
president's Materials Policy Com- Strautmann was formerly Vicemission
(1950)
predicted
that President of J. D. Chambers &

atomic

announcement

any

William

become

the

and power
a
householder

Quite the con-

ought

quali¬ to perform best at this wobbly
depression, light juncture on the Dow Jones Chart.
is about the last thing Let's see if we can pick out a few.

well

long-term sag.

Wm. Strautmann Joins

now

are

common

letter

defensive

your

year

market

not

writers give the nod to utility
equities of this ilk, at the moment,
the leaders of this industry see

either

losses:

Whether

traded over the counter,
appears to have attraction on an
income basis, and fairly evident

Maine,

Crowell, Weedon & Co. •

Carl M. Loeb, Rhoades & Co.

The Commercial and Financial Chronicle

(2518)
of

member

Diversion of Stock Block Purchases

Public reporting of the number

From

Washington
Ahead of the News

acquired, and the prices
same,
by specialists in
off-Floor block purchases is not
planned. Only as these shares are
filtered through the auction mar¬

To Stock Exchange Considered

paid

HAROLD J. KING, Ph.D

King examines

rule of New York Stock Exchange

new

On June

the New York Stock

Exchange instituted a rule which
promises to affect the securities
business to
than

erally

much greater extent

gen¬

real¬

ized.

Its

ber

may,

Floor Govern-

purchase

the

Floor

the

Ex¬

change, for

which

block

King

indirectly interested,

directly

Harold

account

stock

which

hei

a
is

registered, without executing the

purchase

orders

prices

his

book

the

such block.

specialist

divert to

lion

transacted
was

over

ommendations

the

counter.

the

Special Committee
Auction

15, of this

tion

Market,

place

carried
auction

unless

enabled

market

his

not

machinery,

the

resources

en¬

negative effect

were

have

net

quick

the

as¬

pur-

account> by
firms in the

Recommendation

Trading

make

with

The

arrangements

for

specialist

off-Floor

Floor Governor

stock is not to be

engage

purchase of

block

forthcoming

un-

less the Governor "shall have determined that the regular market
on

the

Floor

the

This

Exchange

announcement

got

Listed

policies

ties

be
facility

weeks

off

and

of them, expected

any

practical of the

think is

leaders

From almost the

the

beginning, the

study

this

The

relieves the

block* of

sam^

an■

nudged him, urging
effect, "Now is the time to show you are boss. Give an 'emphatic
no,' to him. It will restore your lost prestige."
The General did

this and then

the Taft speech and there

getting his dander

off-Floor

informed

Previously he had been

was

it developed he had

not the

required to fill at his purchase
price all such purchase orders on

learned the truth.

his

was

that

special offerings, but to other situations and opportunities which
mav

come

tention

the

his

activities. With

the specialist

ondary

not an

offer

specialist's

normal

•

carrying a bid at or
above that price.
Exchange offi¬

course

engage in see-

distributions

to sell or a solicitation

improve

the

of specialists.

income

of-an offer

seen.

reaction of the country
generally will be one of tremendous relief
and silent gratitude towards the man who
brought it about.
It will reflect an essential difference between the
President
and his

predecessor. He moves quietly without fanfare and withchip on his shoulder. His predecessor was boistrous and

mood

"tell

somebody off."
way

never

Which is the better
way?

Company

;

were

the effect

that Eisenhower's personal

It will make the

because
ment

Price 101.295% and accrued interest

that

have

circulatedfrom only such

lawfully offer these securities in such State.

brought

(Special

The

end

Financial

this

.business from offices at 210 West
■V-

HALSEY, STUART A CO. Inc.
STROUD & COMPANY

MULLANEY, WELLS &. COMPANY

.THE

...

THOMAS &, COMPANY

COURTS & CO.

ILLINOIS CQMPANY

INCORPORATED

STUBBS, SMITH & LOMBARDO, INC.

June 11,1953

formerly

with W. Ross Campbell.;

(Special to The

LOS

^G.

Financial

ANGELES,

been

added

7 ~

will

treat

(Special

the
r .V!;

The

Financial

Chronicle)

ANGELES, Calif.—Harry
Colmery, Jr. has become af¬

filiated with William R. Staats &

Co., ^640
members

with

Chronicle)

South
of

the

Spring
New

Street,

York

and

Angeles Stock. Exchanges.

Bethke

With Walston

Calif. —Cecil

Gardner, Sr. and

have

;

LOS

Morgan & Co. Add
7.:

Peter Mayer
the staff of

Morgan & Co., 634 South Spring
Street,
members
of
the
Los
Angeles
Stock
Exchange!
Mr.
Mayer was formerly with Edger-

ton,:Wykoff & Co. '

*+•

fiasco

Los

STIFEL, NICOLAUS & COMPANY
-

was

...

INCORPORATED

STJERN BROTHERS &. CO.

With Wm. R, Staats Co. 7

Chronicle)

ANGL'LES, Calif.—S. Niles
Gates is engaging in a securities
He

LOS

Seventh Street.

holding

shine brighter than it has for
many years
right to assume that the same even tempera¬

S. N. Gates Opens
is

was

sun

announcement

problems which remain.

State in which this

stock

up, considerable disappointment was developing towards the
party
as a whole.
Then without
any advance advertising or build up;
amid, in fact, a lot of jibes of "We thought you were
going to end
the Korean War," an armistice
comes

Due June 1, 1983

SCHOELLKOPF, HUTTON &, POMEROY, INC.

-V-"

•

a whole.
Here, they have been going along for months appar
ently getting nowhere. While reports from around the
country

Series due 1983

Dated June 1, 1953

as may

This shining example of the different
ways of doing things
should embrace, in the minds of the
people, the Republican party ?

up!

of the undersigned and other,dealers

One way effected an
accomplished anything.

Mortgage Bonds, 4

any

Their attitude will be "Let the Presi¬

doing all right!"
The truce, of
course, will not be that glorious victory which
brings form uie snooting of fireworks, tne playing of bands and
dancing in the streets. In fact, the New Dealers will find plenty
to criticize about it; there will be
charges of appeasement. But the

offering is made only by the Prospectus.

be obtained in

stop to the restlessness among the Republican
It will certainly lift his stock to a high point

among the American people.
dent alone; he's

buy these securities.

■

members of Congress.

indus¬

rc^ama

of the editors and

Its effect in diverting to the
Exchange transactions now han¬
ovcr-ine-coUiHci'

a Korean truce, the President will
position to tell these Warwicks that his way of doing
things
bring results and he thinks it best to stick to it. In short,
the accomplishment should
bring an end to the captious criticism
seems

try.

dled

imagine what he thought when he
are indications this advice
to make the General unsure of himself in his new
can

Nevertheless, there

With the accomplishment of

be in

mean new

securities

tending

You

getting

was

field.

possibilities

It cannot

seriously doubted the advice he

before the incident.

books

business for the

at-

permission, though,

may

Gulf Power

not read

slightest justification for his

up.

The General had

,000,000

IRA HAUPT A. CO.

that, to be
Their campaign

leadership.

ridiculous head

new

specialist of the

obligation of clearing his book for
a
given stock, when he acquires
purchase.

writer

anyway.

a few weeks ago over the
so-cailed Taft "go it alone" incident. There was not the
slightest
provocation in the Taft speech, no reference at all to
"going it
alone."
But these guardians of the General

problem,

always in

may

timing for it

Administration has been

new

"strong," to show his "forcefulness"

accomplishment; the Truman

Prospectus

best

It should be noted that the
rule

change."
steps have not yet been taken to
ascertain
the
extent
to
which

can

out

The

They will be

•

The

First

have.

able to face the people without
any apologies. A tax reduction
wait until next year, until the eve of the
elections when the

expects to report to the
Board of Governors on it shortly.

Ex-

•

few,, if

ago

Korea, the members of Congress—the whole
accomplishment in hand and one that a few

in this respect came to

securi¬

the

truce in

ments, to facilitate specialist deal¬
ings." A new committee was es¬

possibly

With

hands and this added to the

own

leaderless, disharmonious party.

specialist capital requirements, or
alternative
financing arrange¬

made with the
the Exchange

may

same

listed

were

the defensive. A group of editors who consider
they made Gen¬
eral Eisenhower President have felt it was their
responsibility to
nurse him
and they were
continually harassing him to do what
they wanted him to do, couseling him to do this and

that bona fide

distributions

next -year

years.

may

Committee

again

run

taking things in their

were

picture of

creditors.

Special

tablished

Securities: Amendment of rules
and

pressure groups

plaining that it

They

Exchange representatives indicate member firms may care to parthe object of such business ticipate in the
type of distribu- cials state this relieves the spe¬
is to improve the auction
cialist of the obligation to fill re¬
market, tions envisioned,
by adding to
its
breadth
and
The rule is not designed to ap- tail orders at wholesale prices.
liquidity.
ply to secondary distributions or
The new rule should definitely
a

by organized

Carlisle Bargeron
was all very well for the
President to be counseling against tax reduc¬
tion at this time because he didn't have to run
again for four

that

Permission of

pounced

have

who

margin

type

with loud cries of injustice and
charges of
patronage grabbing. On Capitol Hill impatience
wes being; manifested towards the
President.
The party wasn't
accomplishing what it had
promised to accomplish. Members of Congress

requirements, the
"leverage" of the specialist,
though, is limited Only by the

0f ^he Committee reads:

obliga¬
It is to be

nor-

have

from

auc-

stock,

QWn

member

"Off-Floor

the

which

specialist Broadening the Auction Market
dispose of recommended
"An
increase
in

amounts

for

empi0ying

published

outside

for

now

Everything they attempted to do was the
subject of criticism by a hold-over New Deal
press.
It made them fretful. Cabinet officials
seeking to effect changes in their departments

liquidity of the auction market. >
Present regulations require the

his

through

same

redistribution."

specialist Aby his
franchise. Although the transac¬
tions provided for by this rule are
mal

ties
up
his
re¬
.(including credit) in offr
purchases.
Only in those

cases

They had been cut of office

that they were in they seemed
not to be able to accomplish
anything.

believes that the

chaged

the

long and

extent

joyed by the specialist are rela¬
tively unlimited would his offFloor purchases of blocks of stock

year.

not

frustrated.

market

the

specialist

Floor

However, the JanuReport ieads: «xhe Com_

sj[zable

rec-

the specialist.
considered entirely separate from
those dealer-function obligations

imposed

auction

sources

is not supposed to

forthcoming

gbouid

Exchanges
Broadening

does

the

restricted

party—will have

Speciaxist to purchase

mittee

Exchange officials point out that
rule is permissive in charac¬
It

0ff_Fi00r block

the

ter.

con¬

corr

being

adopted pursuant to the

the

such

liquidity

|.jon market.

por-

now

relief to the country; it will take

Exchange
officials
emphasize only 100 shares of each of the
that a specialist will not be per¬ stocks for which he is registered
mitted to retail, or wholesale, off (equal to the marKet value of 50
the Exchange a block of stock he shares, in the case of ten-share
acquires in an off-Floor purchase. unit stocks). As the Federal Re¬
The Floor Governor's permission serve
Board has exempted
him

attempt

Exchange

business

Jan.

will

rule

•

specialists

jntent to retail

the

new

will not

only bring a feeling of tremendous
a heavy load off the back of the
Republican party, put them back on their feet,
give them time to
get a good fresh breath and develop some confidence. *
They have
been chafing at the bit,
growling at each other,
flying off at tangents. They felt restrained and

the

sets equal to the market value of

for

This rule represents an
to

above the per share

paid

price

this

A truce in Korea

What is not clear

block.

special¬

By CARLISLE BARGERON

that

stock's price range and
volume;
(b)
attempts
made to dispose of the stock on
the Floor; (c) the condition of the
specialist's book, and Floor quo¬
tations for the stock; (d) tne spe¬
cialist's position in the stock; (e)
public interest in the stock, and
(f)
the number of shares and
market
value
of the
particular

with
prior ap¬
proval
of
a

•off

affected.

definitive
"broadens"

business

how

would

the
trading

the

(a)

reads:

ist

auction market.

a fair and orderly mar¬
Such determination
is to

be based on considerations

The main part
of
the
rule

ticker

prices, absorb the particular block tribute to that market's liquidity.
of stock, and that the purchase On the contrary, it would seem,
will
aid the specialist in main- other things being equal, that the
ket."

353.

the

almost self

action v.h.ch adds to its vol¬

ume

cannot, within a reasonable time
and
at
a
reasonable
price or

P taining

num¬

any

purchases outside usual auction market procedures.

for

will

ket

designed to tap over-the-counter market by handling stock
block

.Thursday, June 11, 1953

tion of Securities Dealers.
of shares

Dr.

National Associa¬

the

(Special

-LOS
W.

Financial

Chronicle)

ANGELES, Calif.^Robert

Bethke

with

The

has

Walston

become

Co..

Spring-Street. •'He

was

with Akin-Lambert Co.

affiliated

550

South

formerly
.

Number 5228

Volume 177

...

The Commercial and Financial Chronicle

(2519)

11
A

the

The Price of Gold

comitant

■■V;

''l

By PHILIP CORTNEY*

huge

paper

inflation

money

during World War I and the
rise

impossible
war

President, Coty, Inc.*

prices

enormously since 1938, while the would double the currency value
world's gold stocks and current of the
existing monetary gold re¬
gold output have lagged far be¬ serves; the output of gold outside
hind. (A comparison with 1926 as the United
States, assuming a re¬

con¬

made

maintain

the

pre¬

relationship between gold and
currencies (once paper

base

paper

Asserting revival of free international trade and exchange

restored, Mr. Cortney lists

ments

that

price change to $70

the
•

asked to

was

speech today I
the

views

Council
less

not expressing
either
the
U.
S.

state that in my

the

NAM

and

still

those

the gold standard.

gold standard is

ernment.

goguery

the

cized

the best brains

the

money

Two Problems

and

■

credit.
The price

present

faced

are

One is to re¬

international

cur¬

inspiring confidence to the
peoples of the free world, and the
second is the social and political

rency.
Philip Cortney

with

emotionalism

country, is an issue which necessity of avoiding a strong de¬
a consequence of paper
flationary trend of prices as a re¬
debauchery
during
big sult of the checking of inflation.

arises

disorder
problems:

establish

the

consider

with two

been

loaded

When

monetary

gold, while it
has

wish easy money or

science

in
of

them

governments
want to
meet budgetary deficits by mone¬
tizing government debt.
*
who

I consider

sons

exer¬

money

made

gold).

the

The

United

States
the

expansion

could

maintain

financed

recon-

credit

govern¬

of
or

simply

because

relationship between

pre-war

tered

wish

the

was

express
my
conviction,
by Prof. Charles Rist and

international

economists, that the 1929 de¬
pression-would not have been

the

confuse

for

quest

gold

quest for

devaluation of

the dollar.

intense

is usually

currency

designed to take care of the lack
of balance between internal prices
world prices, while a

wide

swings

Lack

Great

to sell it
,

Understanding of

"Gold Price" Issue

Why is there such
lack of

Britain's

price

a widespread
understanding of the gold

issue

among

economists?

bankers

Professor

lion in 1951. Over the

prolonged

ity.

The

restoration

international

requires

trade

domestic

and

fiscal policies compatible with in¬
ternational
liberal

solvency, and more
policies, pri¬
the part of the United

commercial

marily

States.

But

country

world¬

the price of

adjustment in

for

all

like Great

other countries.

fact, however, that

the

ing
and

value of world trade has increased

the

result

with

the

normal

"the

only $33,000 million. Only a sub¬

situation

stantial

"gold

000

million, whereas the existing

the

make them adequate for

international

that

the needs

have

terms of dollars have
doubled or trebled, and when the

monetary
trebled
The

qnly result
of ihternational

can

shrinkage
and

constant

balances

trade

instability in the

of payments.

rise

This

announcement

is not

been

offer to sell

or a

allowed

and

money

what

would

possible if the

condi¬

excess

any relationship to the pro¬
duction of gold. The great mistake?
after World War I was to try to

maintain simultaneously the
war

Continued

page

solicitation oj an offer to buy these securities.

$25,000,000

re¬

sult of the official American price
of

being

gold

fixed

$35

international issue.

since 1939. This haopened

Besides, I can't ascribe sanctity
to the figure of $35 an ounce, as

the

that

fact

per

Company of Baltimore

in spite

annual

the

Refunding Mortgage Sinking Fund Bonds

First

pro¬

duction of gold in the same

period
has actually decreased, which
some people do, knowing well that
would normally tend to increase
this
figure was established
by
its purchasing power. A readjust¬
former Secretary Morgenthau in
ment of the price of gold should
tossing a coin at breakfast time.
be made to bring the purchasing

Series Y 3%%, due June 1,
Dated

1983

June 1, 1953

The short time available
my

will

speech

words

economize

force
be

to me

rather

dogmatic.

would

clearly and em¬

have

what

nearer

been

Price 102.239%

rise

the

and accrued interest

prices had been due to an increase
in the

I wish to state

gold

power

production of gold and not
government debt.

monetized

phatically at the outset that to The alternative to such a read¬
mind the price of gold is an justment would be to bring down
issue only if we are determined
the level of prices, wages and in¬
to stop the monetizing of govern¬
comes
to what they would have

standard

cifically I
the

the

gold

internationally.

Spe¬

remained

opposed to a change

while the

restore

and

debt

ment

gold in order to
create convertibility funds or for
in

price of

closing

dollar-gap

the

less

relief

and

still

producers

been if the production

International

tained .if

Chamber

aiming will be at¬
restore the

-cannot

convertibility of currencies
and stable exchange rates.
Equi¬
librium
before

the

balances
first

fortuitous

ber

be obtained in

statement

World

but
by

the

Mr.

payments
War

was

result

Cortney

before

Congress of the International Cham¬
of
Commerce,
Vienna,
Austria,

May 20.

1953.

avoid
of

issue.

standard

prices,

and

HALSEY, STUART & CO. INC.
COFFIN

DICK &,

BURR

INCORPORATED

price of gold becomes a real
The reason why the 1929

United

Britain

States

failed

HEMPHILL, NOYES &. CO.

MERLE-SMITH
•

SCHOELLKOPF.HUTTON &, POMEROY.INC.
WEEDEN

BLAIR, ROLLINS &, CO.

WERTHEIM &CO.

STROUD

CO. '

BAXTER, WILLIAMS &. CO.

NEW

COMPANY

INCORPORATED

YORK

HANSEATIC CORPORATION

the question

depression was so deep and pro¬
longed remains a mystery to many
people. Essentially, it was due to
the fact that the governments of
the

such

offer these securities in such State.

Gold

strong deflationary trend

wholesale

of the

gold

State in which this announcement is circulatedfrom only

1939

Hence, if we are to restore the
international

any

of gold had
as

reasons.

which

free

the

may

of the undersigned and other dealers as may lawfully

L.F.ROTHSCHILD &CO.

Commerce are

not

Prospectus

production of goods had

The Pricing of

None of the goals towards

the

same

largely increased. Such a defla¬
tion of prices and wages is un¬
thinkable for political and social

gold.
-

the

The

and

Great

recognize: that

WM. E. POLLOCK &, CO.,
WILLIAM

COOLEY &. COMPANY

June 11, 1953

INC.

BLAIR & COMPANY

BACHE &, CO.
"

COURTS & CO.

HIRSCH & CO.

F. S. SMITHERS &, CO.

CENTRAL REPUBLIC COMPANY
(INCORPORATED)

MRA HAUPT k CO.

pre¬

1914 price of gold in terms of

credit

offering is made only by the Prospectus,

gold, but the outcome of arbitrary
abusive
printing of paper

out

price of gold to $70 an ounce

The

one

abnormal rise in prices, with¬

markets.

present lack of international,

liquidity

the

domestic

the

tions regarding convertibility had
been maintained. The result was-

have more than

means

greatly in

throughout the world prices and
wages

1920's

governments

growth

when

payments

the

shortage."
What actually
happened during World War I is

price of gold

rela¬

production

by governments.

could increase the gold reserve to

and

money

shortage had
caused the great depression.".First
of all, I object to
estimating the

monetary gold stocks in 1950 were
rise

gold

due

present level
of world prices is

structure

tionship

the

The

war.

whether

(excluding Russia) are about $70,-

payments

monetary

question,

of the whole world

needs

reserve

balanced

and

gold is designed to correct a lack ounce and of the supoort of this
of balance within the structure of price in international exchange,
world
prices, as it has proven the purchasing power of gold it¬
necessary
and
inevitable
after self has reflected the depreciation
of the dollar and decreased by 50%
World War I. It is essentially an

for

and

Charles

mainly to abuses of paper money
(monetized government debt) dur¬

not

I wish to make clear that a de¬

and

induce hoarders of gold
their central banks.

Rist traces it to the teachings of
1938, increased to about $158 bil¬ Ricardo. I venture to
ascribe this
same period
lack of understanding to two in¬
as; it was,
if in 1925 the dollar the world production of gold fell tellectual
prepossessions, frequent
and the pound had been devalued from 32 million ounces to 24 mil¬
among English and American,
in order to sustain the level of lion ounces. Excluding Russia, the
bankers and economists, namely,
prices reached because of the in¬ gold reserves of the central banks (a) a confusion between
money
flation
of
the
monetary means of the world rose from $26,970 mil¬ and credit, and (b) a failure tolion to $35,950 million, a rise of
during the war.
distinguish between the different
33%
as
compared to "a rise of
impact of money versus credit on.
International Liquidity
250% in world trade. In 1938, the
the long-term movement of prices.
reserves
of Great Britain
While my main argument for a gold
I wish to analyze some of the
covered nine times their monthly
rise in the price of gold in case of
arguments against a rise in thd
imports while in 1951 they cov¬
a return to the international gold
price of gold.
1
ered them only three times.
standard
rests
on
what
I
have^(1)
In
its
April monthly
In
October, 1950, the London
just said, I wish to say a few
"Letter" the National City Bank
"Times" estimated that the gold
words on the international liquid¬
tries to answer the

either

the

adjustment

prices

in terms of all national currencies,

valuation of

Furthermore, a rise in the
price of gold would most probably

position. The value of world trade,
which was about $45 billion
in

other

true

worldwide rise in the price of

ounce.

requires

consequent large

with an actual production
$760 million in 1951 at $35 an

the

change

great

The

would have to be worldwide.

recommendation
and
price of gold is necessary to cor¬
against my wishes.
rect a lack of balance within the
I regret to find that so many
structure
of
world
my

with

pared

financing

the

trade

exchange

in - international
payments.) The
comparison with 1914 is complete¬
ly out of place because of the

shat¬

depression.

1929

abuses

gold

Besides,

the

and

their currencies and gold and yet
avoid a strong deflationary trend

of prices; The illusion

was

of gold output to the 1940

covery

level, could reach an annual rate
of about $2,200 million as com¬

present monetary
disorder, exchange controls, quotas

problem

devalued'since 1939 by 50% with¬

people

quarters

greater liquidity than in the 20's

credit
restore

monetary technique in the resto¬

out

some

the

international

illusion

and

standard.

and

Britain, for instance, should have
of Only gold inspires universal and
enough gold reserves for the pur¬
unqualified confidence. But if we
pose of balancing a deficit in the
ration of monetary order.
There are ;o restore the gold standard
external balance of payments until
is no room for emotion in such a internationally and avoid a strong
either
any
temporary difficulty
deflationary trend of prices the
question.
has passed or until the central
Some of my friends say that I price of gold becomes of para¬
bank has had time to put into
mount importance.
The? problem
am recommending a devaluation of
of the price of gold is essentially force measures leading again to
the dollar. Let me remind them
international and its readjustment am equilibrium. This is of course
that the dollar has already been
is

wars.

improper, because the interna¬
liquidity was then unsound,

per¬

of
chiefs of central

The

at times the pressure

resist

but

those

dema-

and -irresponsibility

oanks would have to be heroes to

express

personal

effective

electoral

the

p3liticians.

opinions I

shall

The voluntary

is no substitute for the
international gold standard.' Only
brake

by '

shared

policies
the

are

J.'

coordination of national monetary

the U. S. Gov¬

Neither

* .1

an ounce.

they

y~\

currencies
into

of Great' Britain had

•3,

price to misunderstanding, and, in conclusion, recommends

inflation had been stopped

the

vertible

done

tional

and

problems involved in attain-;
ing these objectives: (1) re-establishment of an international
currency in which free world can have confidence, and (2)
Hie prevention of a strong deflationary trend of world prices.''
Says question of "pricing gold is a real issue," and offers argu¬
ments for higher gold price.
Lays opposition to raising gold
are

money

can¬

be attained unless "free convertibility of currencies and
stable exchange rates,1 under an international gold standard,.,

not

fy '

STERN BROTHERS k CO.

The Commercial and Financial Chronicle...

(2520)

What the

We
know
that
share of American Telephone and
selling
new
Telegraph common have been far shares to finance expansion at a
below, the levels previously
at¬ market
price
above
the
book

Security Analyst

tained in

Wants to Know

activity.

be in spite of the growth in
the volume of business, but it has
may

By MARVIN CHANDLER*

value of

the old

shares will raise

Mr. Chandler points out

objectives of analysts are to ascertain
quality of a corporation's future earnings,

and their relation to price

of individual securities. Lists and
discusses as questions of fundamental importance to these ob¬
jectives: (1) Etfect of Growth; (2) Recession Resistance;
(3) Regulation; (4) Operating Factors; and (5) Manage¬
ment Ability.
Concludes, no matter bow uniform statistical
analyses may be, there Ml always be wide divergence of
opinion among analysts.

vestor

are

needed

the

named

ones

received

most

only nine first votes.

not

sure

can

common

growth.:

earnings stock ;wili

Increased

arise from decreased expenses

solve just two

that

major

tion in the tax rate (let us hope!),
become, we shall always have a in the depreciation rate, or a fa¬
vorable new power purchase con-,
wide divergence of opinion on the

prob¬

lems

—

q u a n

t i ty of

future

earn¬

ings

the

problems
we

need

may

that

Fundamental

consider

that

and

price—that is, the extent to which

With
marks
turn

introductory

behind

those

let

re¬
now

questions which
of

are

fundamental

importance

in reaching the final

conclusion

unit

De¬

of course

expenses

stop and frame the question.
I

these

seems

tract, but that is pot growth.

quantity

be -selling for $26.60
share, compared to $20 previ¬
ously. I suspect that this situa¬
tion may explain a number r of
the outstanding so-called growth
stocks.; Certainly the greater the
increases in demand, the greater
the expansion, the more stock is
sold
above
the
previous book
value, and therefore the greater
per

accompany >. growth
suffi¬
ciently to raise earnings per share.
Perhaps at this stage, we can the

Importance

your

fortunate matter.

Questions

Marvin Chandler
help on. When
they
are
solved, your job is done but ours
is
not,
for
we
have
another

factor

in the-absolute, such as a reduc¬

creasing

the

are

our

ultimately

that that is

quality of fu¬
ture earnings.
Those

uniform

approaches

favorite at any one time, and for
the industry as a whole, I suspect

the

and

how

matter

analytical

and

it, it is twofold, first "What
causes growth in per share earn¬
ings to accompany an increasing
see

volume of business in

not

and

some

others?"

The

cases

second

corollary question is, "How is such
growth possible in a regulated in¬
dustry?" I shall defer considera¬

quality of earnings, but which we
quantity and quality of earn¬
as
analysts most need your help
tion of this for the moment.
ings are already reflected in the
in solving. They come under five
I would like to see case studies
price of the security.
At that
major headings. There probably
made
of
the
electric
point, the analyst's judgment and
utilities
are more than five, but these are
which
experience play a most important
have had the most out¬
the most troublesome to me; They
part. His final decision now re¬
standing growth in earnings per
are:
quires a high degree of selectiv¬
share in recent years, as well as a
(1) The effect of Growth
few which have not, to see just
ity, because there are 135 electric
(2) The Measurement of Reces¬ what the causes have been. Has it
utility common stocks in public

the

hands, the vast majority of them sion Resistancy.
of adequate size and quality to fill
(3) Regulation
(4) The Significance of Operat¬
the needs of almost any investor.
And he will decide not on the ing Factors
basis of whether your company's
(5) The Measurement of Ability
problems are being or give prom¬ of Management.
.

ise

increase

per

ings if the rate earned
value

can

earn¬

book

that the

know

address by Mr. Chandler before
Twenty-First Annual Convention of

the
Edison
Electric
Institute,
City, N. J., June 2, 1953.

growth but the
the

has

it has grown,

needed

seek

Atlantic

regulatory relief, and earnings

per

of(ring oj these Debenturesfor sale, or an offer to buy, or a solicitation of an offer
Debentures, The offering is made only by the Prospectus,

Now

how

buy,

any

of suck

regu¬

simple
that growth as I de¬
possible for a util¬

benefit to the shareholder

the

company

its

common

can

is earning

capital,

its

business doubles, its common cap¬
ital doubles, and it continues to

10%

earn

Company

know

May 1, 1953

the

invested?

money

4Vi% Sinking Fund Debentures
Dated

say

is not

second

ity if earnings start at the allow¬
Why isn't it a fact that

10%

$40,000,000

of the

some

common

tell

1,1973

equity

think

that

company again, with $100 of com¬
mon

capital

represented by ten
earning $1 each and sell¬

ing at 20. It

the year-end

earnings in

end

dividend, but

pays no

reinvests the $10

new

plant.

second

the

year,

At the

will
have $110 of capital earning $1.10
per share and selling for $22 each.
Compare this with a counterpart

was

planation in the
be obtained from

which„

of fewer

you

shares.

new

the

cases

also

know

that

few

some

states do not exercise jurisdiction
rates.

over

don't

factors

know which

has

been

Blyth & Co., Inc.
Harriman

Ripley & Co.

Incorporated

Lehman Brothers
A. C. Allyn and

Smith, Barney & Co.

Company

Stone & Webster Securities

Hemphill, Noyes & Co.

Corporation

Hornblower & Weeks

Incorporated

F. S.

Moseley & Co.

G. H. Walker & Co.

Dominick & Dominick
.

Weeden & Co.

Baker, Weeks & Co.

Incorporated

June //, 1953.

Alex. Brown & Sons

Riter & Co.

concerned, how
these customers of

dependent

are

yours

general

business

mands frills

business
territory?

your

what extent

nonessentials which

be cut down?

can

and

their current de¬

are

mortality rate

How

much of

be expected
among
commercial customers?
How much family doubling, up or

can

moving to less elaborate dwellings
can
be expected among residen¬
tial customers?

I realize that you

not know the

may

here

answers

better than I, but I think that
you are in a better position to
study the problem. I wonder, for
example, if the experience in some

any

of the distress textile areas

would

be of

year

assistance.
What would happen to, the farm
load which has grown to be of
considerable importance to some
companies?
Do
you
have' any
ago

wholesale

any

power-sales

arrange¬

ments which would bear the brunt

of reduced demands upon

After

all

the

pur¬

these

revenue

solved,

are

ques¬

how

about

ex¬

pared to other companies? Could
you
shut down much high cost

plant which

plying
If

the

mend

securities

which

has

whether

old

the

com¬

with the least efficient plant

pany
to

in effect is sup¬

now

your lowest-priced sales?
perhaps we should recom¬

so,

look

forward

demand rises and

plants

replaced

the

low
demand falls and

are

actual
of the

know

that

allowable

fixed point

but
a
range,
and
that
growth
within that range is not
only per¬
missible but common.
We

know

have
able

earned
rate

growth
that

has

that
less

some

than

times,
carried

sub-normal

and
them

into

utilities
allow¬

perhaps
out

normal

although more frequently
type of utility has needed

range,

that

regulatory

earning

relief

power.

restore

its

ex¬

Finally,

even if your situation
less promising than others,

seems

you better protected for it by
large carry-through of revenues

are
a

to common?

these

some

answer

can

individual questions ourselves, but
I

that you

sure

could help

factual and comprehen¬

sive study of the problem.

future.

some

here

attitude,

whether

to seek relief

counting

upon

the

find out?

second
I

Recession

problem

think

with

you

intend

promptly, vigorously

completely
when earnings
drop below a reasonable level, or
whether you will hold back.
I
think that

Resistancy

in your

and

was

the

that

our

thorough as
help from

analysis
it could

with

Measurement

be of help

we can

first interested

are

of success,

position

your

Can't

ways

you.

significant

which you are

here is not

the

flexibility

all, the income tax?

the

in individual

improve

these

ex¬

com¬

Where else is there

cept in that most flexible cost of

cases

one

ancy.

Glore, Forgan & Co.

commercial and residen¬

business

Measurement of Recession Resist¬

earnings rate is not
Drexel & Co.

tial

Regulation
Continuing our search for ex¬
planations of growth despite reg¬
My next topic is Regulation.
ulation, we know that some states Probably nothing plays so impor¬
do not regulate on book value, and tant a
part in our thinking and in
in a period of rising prices, rising yours
today as this subject.
To
earnings in those jurisdictions a considerable extent, you can't
might well be permissible.
tell us the answers.
Perhaps in

in the last few years.

any

So far

pays

panies that have grown the most

of the several under¬
only in slates-in which such underwriters are qualified to act as
dealers in securities and in which the
Prospectus may legally be distributed.
may

load if business turns downward?

and at the

to this

where I'm wrong, tell me

expalanations
Copies of the Prospectus

charges minimize the reduction in

penses? How fixed are yours com¬

answers, and especially, to
tell me which of these theoretical

writers

demand

would

extent

con¬

your

therewith?

tions

prevail with retained
Let's assume the same

other

Price 102% and accrued interest

what

they?

are

nature

relationship

earnings.

nor

answers

question but I would like

Due November

of industry

the

What is
tractual

on one or
industries?

tion would

suance

the

question, the growth in
lated
industry.
It
is

result

Northern Natural Gas

about

able level.
to

customers

whether

tomer better than others?

fine

few

out all its earnings cost facilities, or
beginning of the second they cease to operate. What about
growth was in year finances the $10
expansion the relative merits of hydro versus
residential, commercial or indus¬ need
by sale of half a new share. steam, comes the recession? Are
trial business? Which is more ad¬
At the end of the second year the you purchasing power which can
vantageous, an increase in cus¬ $11 of earnings will amount to be cut back, or would your con¬
tomers or an increase in the load
$1.05 per share, which will sell at tractual arrangement not permit
of existing customers? What part
How about other expenses?
20 times earnings or $21, and to¬ it?
mattered

enough to

This is hoi

reces¬

the industrial load

itself is concerned, how much de¬

situa¬

same

of being satisfactorily solved,
Considering the first of these, I is played by the form of the rate gether with
$1 of dividend re¬
whether, perhaps because of think that growth is a factor that schedules?
Have expenses been ceived
provide the
stockholder
some private characteristics or ex¬
is often over-simplified
by an¬ an important factor in the differ¬ with the same $22 of value as if
ternal factors, they are not ca¬ alysts.
Growth certainly is not ence in performance among dif¬ all the
earnings had been retained.
pable of solution by you, but always beneficial, for the Pacific ferent
utilities
with
similar In other
words, if funds in the
rather on the basis of whether at Coast has been the fastest
grow¬ growth trends? Are the good per¬
business are capitalized at twice
the prevailing price of your stock ing area of the
country, in terms formances merely the result of their book value, this will be just
he is getting more or less future of
population, but this growth starting with older and less effi¬ as true of new funds left in
by
earnings, quality considered, than generally has not carried through cient plant, or with greater re¬ stockholders
as of new funds sup¬
he can obtain in any of over a to increasing per share results for serve
capacity throughout the sys¬ plied by sale of common. The rise
hundred other issues.
electric utilities.
The telephone tem?
Have
some
companies in per share earnings, however,
The
range
of
disagreement industry since the war has had been able to hold down the new is more rapid, the more funds are
among us is wide.
At a recent outstanding
and
continuing plant investment per new cus¬ left in, merely because of the is¬
•An

So far

chasing utility?

be maintained.

the

sion?

less sta¬

large in times of

pendence do you have

increased

than

What type

For example,

there¬
equity
now,
however,
earnings per will produce $20, which, when di¬
share resulting from an increased vided
by 15 shares, results in
volume of business.
earnings of $1.33 per share.
The
It seems to me that aside from meeting of the utility group .of
Increased
earnings per share old investor has experienced a
so-called special situation analy¬ the New York Society, 121 an¬ are not necessarily attributable to very satisfactory growth.
More¬
sis, such as a merger or recapital¬ alysts filled out questionnaires to growth, and growth does not in¬ over, if his earnings are capital¬
ization, and short run analysis, all determine their first, second and variably produce increased earn¬ ized at the same 20 times rate as
the
facts for
third choices for the most favored ings per share, as I noted a ihor before (which of course is very
which
we
as
utility common stocks. * A total of ment ago. Increasing earnings can high, and was used only to sim¬
75 companies were cited, and the arise from rate relief, but that is plify
analysts
the arithmetic), then his
search

Growth

earnings.

fore

ble

book value is fixed.

judgment the only growth other >100 of common capital, so
is significant to the
in¬ five shares are sold. Earnings at
is
growth in per share the same 10% rate on the $200 of

which

and small firms more

per share earnings even
though
the return in terms of earnings on

been such a persistent and con¬ assuming that a company is capi¬
with
tinuing result that one becomes talized
$100
of
common
suspicious that it may have been equity represented by 10 shares,
on which it is earning
because of the growth.
10%, or $1
Perhaps we should stop here per share, and that the shares are
and try to define or at least de¬ quoted
at $20 each.
Increasing
limit what we mean by growth. demand
necessitates raising an¬

Vice-President, Reis & Chandler, Inc.

both quantity and

periods of high business
The result in both cases,

Thursday, June 11, 1953

course

any

are

often

but

impatient
the first I

outlined, and if you do not take
an
aggressive attitude, we want
to know why. You may have ex¬
cellent

tion.
ter

reasons

Perhaps

than

which stand

for

delaying ac¬
foresee bet¬

you can
can

economic

forces

good chance of cor¬
don't think that study of the 1932 recting the situation without reg¬
experience is sufficient or even ulatory action. You certainly are
more

you.

rewarding, when residential usage in a better position than we to
was a fraction of today's level and judge the proper timing from the
when

commercial

and

of energy were
different.
I want to

uses

how

stable

are

industrial

also greatly
know

revenues.

viewpoint of public, political and
customer

relations.

think

that

first,
How

many of us are too prone to

judge

does the economic stability of your the matter solely from the inves¬
territory generally compare with tors' viewpoint. You can help us
others?
tion

average

industrial

guarantee

diversifica¬

better-than-

stability? Are small plants

to see the other sides to the

Continued

prob-

page

Volume 177

Number 5228... The Commercial and Financial Chronicle

"dog must be shot" and that tech¬
nological obsolescence will have

fluidity in the face of the threat

to take its toll.

Building Trends and the
Building Materials Industry

membered

Massachusetts Institute of Technology

when

of buildfaig services, inch

'r:':*"

«ew

•

of construction."

era

addressing myself to the subject "Significant
Trei^s in Building: Construction and Their Effeets

20%

the overall

and

irrational

completely

fundamental change

some

approach

looking

in cost

loss

Walter C.

tices in products; and

reducserious

toward

aid in

ing this I hope
stimulate discussion which

integrate

concepts of this

problem with your duties in guiding the formulation of our indusand

financial

tendencies

interdependent

structure,

interrelated

are

and

dis-

cussing them separately we must
keep their relationships in mind.
These tendencies may be

cate¬

gorized as:

Without

any

tion

owners

The

ready

ties

with
Securi¬

Company
Chicago,

134

South

the

Ex¬

change.

Randall
-

Ease- of* attachment- and detachment .will aid in the salvage of

of f expensive metals and: de?, willfurther aid in meeting obso-

Mr.
has

recently been
7-'with Cruttenden & Co. and

prior
Ralph G. Randall

Midwest

Stock

and\designers of M

Street,

members

co¬

adop«>|

heights, site

be¬

associ-

Salle

tion will further aid this process,

edicts of the

efficiency and service is standards for design and construe-

tism and dictatorial

First

will greatly

of installation and
use.

has

come

thereto
Manager

was

department

restraints, and built-in services

industrial

and

space

con¬

use

shifts

new

for

of old

location

economic

in the

the

tendency

engineers

part of
present high cost of construction
services
involving too much site labor and

the

bury

these

donment of either the site

original

specific use.
full of "white

elephants"
which
some
corporation
because of

plaguing
lending

are
or
a

lack of initial

consideration of these elements.

materials;

use,

emerged

concept

and

many

space

our

partner

Watts,

Ingalls & Snyder, New York City,

mques.

passed away at the age of 84.

connotation

one

another

architectural offices. Rigid,
threaded piping will have to be
eliminated in carrying water sup¬
plies, either hot or cold; heavy,

This advertisement is neither

superseded

solicitation of offers to buy any of

these~securities.

June 10, 1953

NF.W ISSUE

prefabri¬

cated

have conduits will have
older

offering is rhade only by the Prospectus?

stacks

soil

cast iron

offer-to sell nor

art

The
J

tubing of equal efficiency
and and more
economically fabricated;

materials

new

many

pendent upon old, outmoded tech-

many

cumbersome

Materials

result of the challenge of

new

Samuel H. Watts
Samuel

practices which are de-

ciple of "getatability," to coin a
word which is now being heard

will
As

this

too many

the

concept

country

obsoles-

in the rigidly "frozen" structures,
zation and change within the life
making it next to impossible, ecoof the core of the structure. Such
nomically,
to
make
necessary
an: analysis
on
several
recent
changes.
One
of
the
"crying
projects has resulted in the abanneeds" in this field is the prin¬

The

„ru..

v.-

mate¬

use

the assurance of the
feasibility of moderni-

New

Applications of

rials and

and

cence,

cepts of design;

(b)

and equipment

agency

New

(a)

ease

ordinated

Chronicle)

dall
C"

past, and all of them require the panels and covering material and

tive bay sizes, story

and

to The Financial

struction, will allow the develop¬
ment
of mass
production prac- 1

imperative.J All of these services
are bogged down in the conserva-

trial

(Special

CHICAGO, 111.—Ralph G. Ran-

it willv greatlyv reduce the
time element in design and con¬

These

First Securities Co.

substantial financial in¬

•

will

Ralph G. Randall With

re¬

rep¬

wh' iescerice as it impinges on appear-: of" -the trading : dej
for specific occu- ™snts of • this^ cost is the high ^
•
Mason, Moran & Co.
Building Materials pancies. The thought is being hourly wage of the tradesmen in ance or use.
As previously mentioned all of
these fields, who after all are re-,,
k
Industry," I given to the analysis of building
Hogle Conference
shall
try to occupancies and use to combine quired to possess unusual skills these tendencies are acting and
•LOS ANGELES, Cal.—Partners
^ f •
point out the two or more such occupancies into
advance
be considered concurrently and Managers of J. A. Hogle &
with the technical improvements
major tenden- types so that multiple use is posin design;. While it would be pos¬
Co.'s Los Angeles, Beverly Hills,
cies
toward sible over a predestined period of ? equipment and design. While it
sible to expand any one of these Riverside and San Diego offices
fundamental" building life in a .given location. 1S ^rue
water and steam must
held a regional sales meeting this
be transported by pipes, air by tendencies to a much greater ex¬
changes in Inasmuch as the nature of the
week at the California Club.
^
ducts, and electrical power by
technology construction
would
tent, it is hoped that the ground¬
vary
with
:James E. Hogle, Managing Part¬
wires and conduits, it is equally
and
economthese use types, it follows that
work may have been laid for fur¬
as true that our pipes, ducts and
ner, and Richard Beck, Partner,
ics
which
I
buildings so built would have
ther
discussion
and
questions, both of the Salt Lake headquar¬
believe
are
lives extending over various pe- con(iuits are obsolete in the light
ters of the firm, and Karl Meyer,
gaining con- riods. The possible occupancies of
contemporary knowledge, The some of which I, or perhaps some
Manager of the Denver
office',
siderable
acsuch a building must be analyzed multiplicity of sizes, fittings, and 0£
Q
can answer
of this I am
were
principal speakers at the
ceptance in to determine whether one or more techniques will surely be found
We are on the threshold of
meeting, conducted by C. J. Ca¬
unnecessary
when
the
present &U1C
professional of such uses could be substituted
a completely new era of construc¬
trend really takes hold.
ble, Partner, and J. D. Boggs,
and scientific for the original use without fear
Voss
Another phase of this dilemma tion,. all brought
about by the Manager of the Los Angeles office.
circles. In do-

;

I may

must

building

the

•

about

uation

It
a

tions;

con¬

today this percentage has
risen as high as 40-50%; This sit¬

tion

heating, plumbing, air conditioning and electrical services, ali of whichyneed continuous
modernizing. Concludes "we are on threshold of completely
use

-services

basic

cost;

production practices which reduce unit costs.; Sees increase in

;

these

sumed

that

Use

Prof. Voss points out fundamental changes in economies and

obsolescence.

Building Services
vestment and should be designed
Building services such as heat¬ so that this investment will be
ing, air conditioning, plumbing amply protected. Modular plan¬
and electrical services are prob¬ ning when it becomes of age will
ably due for the most complete allow all materials to compete for
overhauling.
There f was a time use when they meet the condi¬

Head of Department of Building Engineers

technologies of building construction, which comprise rea¬
sonable durability, flexibility for multiple use, and development
of-facilities to meet obsolescence. 7 Says these changes have;
brought about new materials, more shop fabrication, and mass

resents

By WALTER C. VOSS*

(2521)

for

multiple

uses

800,000 Shares

studied

and change and

services;
materials have, beeirsubjected to preferably placed in prefabricated
(d) Integration of modular plan- serious study ,to make them ap- vertical or horizontal panels from
ning, standardization and salvage, plicable to this demand for standthey may be serviced; zonal
.

AH of these may

effects

the

have profound

financing of present

and future industrial ventures, but
I

shall

this

leave

area

subsequent analysis

as we

your

expand

the elements of each.
Until

quite recently nearly all
buildings were conceived as a
succession of bays and stories in¬
volving the use of columns, beams
and; floor
systems
which were
more

less

dependent

dimensions of the
occupancy

and

the

site, the specific

the

normal

nomics of structural design.

eco¬

Each

ardization, ease of installation and
? *n£e;
u,us we
a vefy def"
llllte trend away from heavy
masonry walls, partitions and
floor
,

the use of
lighter weight panels of metals,
plastic laminates and processed
of

materials

many

compositions.

introduction

and

result of the
these materials,
a

plastering is rapidly declining in
use
and
the structure is being
erected

from

and

Correlative

such

costs

for

ex¬

tied more or less pensive forms for concrete, stag¬
prearranged ideas of ings for masonry work and wages
the owner or lessee and the de- 0f some 0f our
highest paid tradessigner
rarely
questioned
these men are being reduced. Site la¬
wishes; he made the necessary bor is being replaced by shop
project
rigidly

was

concessions to such ideas in order

fabrication

The

called

owner

his

upon

own

experience and personnel to for¬
mulate

his

ideas

and

made

practices

with

and

repetitive units,
though he might have wished to
revolutionize the entire approach.

mass

and

can

sufficient

production
reducing

are

unit costs.
This

ing

approach is only now gain¬
momentum,
and
manufac¬
are developing
more new

turers

serious

attempt

his

analyze

problem from every angle and in
complete detail.

panels
the

and assemblages to meet
concept.
Designers are

new

mands for

Architectural Changes

process

however,

Recently,

forward looking owners
architects

sought

and

the
and

engineers

incorporate

more
many

have
their

projects the principles of reason,

able
use,

life,
and

flexibility for multiple
ease of change to meet

obsolescence of appearance,
ices

and

This

use.

quires divorcement
*An

serv¬

approach

from

address

re¬

restric-

by Prof. Voss before the
Boston Security Analysts Society at the
Harvard Club of Boston, Boston, Mass.,
June

1953.

•

time

heavier,

of the

same.

accelerate

will

is not

their

expanding

continually

Air

conditioning,

signed, is probably as uneconomic
as any
of our services. In many
cases a complete plant for cooling

Par Value

per

volume,

cupies valuable building
but is used

only about 15% of the

all

Where

that

namely,
the

providing

all

times

using

same

spending
this

latter

direction,

thetrend

indicating

can

This

able unit in

area

the

and

the

needed.

and

and will take

the stand-

Thus brick, stone,

tile and such
materials, at least in their present
dual capacity as load-bearing and
skeleton
bases,
will
disappear.
The only other alternative would
be depressed wages and this would
destroy the very essence of pros¬

someone's

Copies of the Prospectus may be obtained from any of the several underwriters,
including the undersigned, only in Slates in which such underwriters are qualified to
act as dealers in securities and in which the Prospectus may legally be distributed.

but alto¬

toward

reasonableness, but much research
is being done and more must be
we

plaster,

that

equipment, we will be
dollars uneconomically.

gether too much of our air con¬
ditioning is in the former cate¬
gory.
The advent of air condi¬
tioning and cooling packaged units
is

store or

when needed

it when not

one

the other

latter

harmony with the prin¬

ciples of multiple

use

which

one

yet

are

multiple

Hemphill, Noyes & Co.

Hornblower & Weeks

Merrill Lynch, Pierce, Fenner & Beane

Kidder, Peabody & Co.

Paine, Webber, Jackson &

has not moved too

that of modular planning,
standardization and salvage. These
of

Glore, Forgan & Co.

Curtis

Smith, Barney & Co.

of the tendencies,

far, is

elements

Eastman, Dillon & Co.

Drexel & Co.

Clark, Dodge & Co.

occupancy

discussed earlier.

Perhaps

Union Securities Corporation

Corporation

must

approaches in the
approach is

two

Tlie First Boston

mov-

conditioning

The

install

remove

Air

these

Price $29 per

com¬

air

and

fort

future.

seems

cooling is necessary

round the story is more
satisfactory, but until air condi¬
tioning assumes its true meaning,
year

done before

and

cumbersome,

use

tive.

Common Stock

and dehumidification not only oc¬

tices will disappear as

perity.

de¬

now

de-

far distant when

ard approach.

Company

and many others.

and changes;

less economic materials and prac¬

concrete,

American Gas and Electric

heating

for

morl.*«£*■*«{»»
its
factor its cost is prohibi¬

expeditiously,
more
economically
structural point of view.

cleanly,

systems

will have to be studied more carefuiiy from the standpoint of cost

and

systems

boards

distribution

of
use

the

very

essence

occupancy

and

fucker, Anthoriy & Co.
,c7

Hallgarten & Co.

Lee Higginson Corporation

The Commercial and Financial Chronicle

(2522)

by. 1932. It is to be hoped that
a conflagration as that can
avoided, but here are the facts:
In the five years from 1946 to
J951
the increase in ."corporate

Coal Seen As Main Source oi

such

Business Outlook Dubious

.Thursday, June 11, 1953

be
r

In Second-Half of 1953
By W. W.

aebt

19.8%,

Townsend-Skinner and Company, Inc.

of a "dubious outlook for busi¬
towards end of the year" primarily on mounting public

13.8%

been

has

dividual

TOWNSEND*

and

than twice
and

instance

one

and

ness

and

debt. Cites heavy increase in corporate borrowing

rapid rise in

will be

is quite

The present out¬

simple.

only

look

for

busi¬

good

tem

the

out¬

been levied

ever

ness

and

for

look

justment,"
which

an¬

other word

;

burden on the

mendous

for

taxpayer,

recession,

the home owner,

within

year

the wage earner

for

this

con¬

.collapse

has

become

conclusions

—

impelling.

They lie in
background
of

immediate

.history,

they represent facts al¬
ready on the record and, while
the tendencies which they clearly

delineate may be—in fact,
be

—

reversed,

what

cannot

"be

has

the

should

already taken
by

the

and

the

facts

—in

.At the
the

Federal

tism at the present

little

larly

the part of those manag¬
ing the affairs of our thrift in¬
stitutions.
on

The

primary

for this

cause

must

earnings

from

the

suffer.

ticularly

the

paid

the

Public

Federal

both

lender.

debt,
debt,

are

par¬

debts,

needs

drives.

must

the

habit

before

the

talk

Pacific

Mr.

Northwest

Townsend

Conference

point.'
charges

War

net state,

debt

was

War

net

nearly

private

debt

collapse

increased

dividual

by 5.1%.
which

Savings and Loan Associations, Ogden,
Utah, June 8, 1953.

off;

forest

in¬

their
new

that

which

fire

any

and

good

con¬

inflation

n g

difficult

the

management,

lines to

has

success¬

fixed

operations

systems/

and

business volume have enabled the

elected

companies to

the

one

major industry that has made

conse¬

material

the

begin¬

its

increases in the price of

product.' Continuation of this
will require every possible

success

further improvement in
and

efficiency

economy."

reference' has

much

for

counter¬

are

'v,

v '

the

growth
date

and

quirements
in

the

load

energy

the

Continued

Members

guests will

Field

Jr.,

page

Gas

LINE

David

Callaway,

Chairman

the

Day Committee, announced
today that the attendance is ex¬
pected to-exceed 325.
Copies of

the

indicated

President's

idly,

must

energy

reliance of the

Noting

the

future." *

over

500,000

kilowatts

service

are

been

steam-electric

LIGHT

COMPANY

units

will continue to

keeping down the
of electricity."

cost

Cautioning that such factors

COMPANY

location,

construction

and

is expected

John F.

that the

over-subscribed.

Egan Visitor
City

In New York
John

Vice-President

Egan,

of the First California

York for
ers,

of San

Co.

visiting

,is

New

week calling on deal¬

brokers and bankers.

under

generating

and

will

Francisco,

that

steam-electric
has

GAS

and

issue

With Samuel B. Franklin

ago,
he emphasized that
"increase in size and efficiency of

Company

MILWAUKEE

•

Day.

&-Co., Ill Broadway, Room 1200,

of great aid in

PIPE

Westchester

at $l.per copy. Advance subscrip¬
tions have been coming in rap¬

Policy Commission.

and

power

CORPORATION

COMPANY

travel

General

(Special

LOS

The

Financial

Chronicle)

ANGELES, Calif.—Ather-

ton F. Messmore is

now

connected

with Samuel B. Franklin & Com¬
pany*

MICHIGAN-WISCONSIN

Municipal

Field

years

CONSOLIDATED GAS

The

Country Club, Rye, N. Y.,, June
12, for the Club's 20th Annual

requirement," Mr.
Phillips said.- "Steam-e 1 e ct r i c

capacity

MICHIGAN

construction, compared with four

JERSEY

economic

Bond Club of New York and their

tion of the 1975

ex-

plants

NEW

distances."

re¬

prospective

1975

report

Materials

consumer1 debt

has also increased to such

and

the

corporations

limits

"The generation of every kilowatthour
of
p o t e n t ia 1
hydro
rapidly mounting total of
power—good, bad and indifferent
savings and the simple fact,
—would supply only a small
por¬
short-term

brought the whole nation to grief

Natural

the

just "been

main

American

atomic plants would

serve

N. Yi Municipal Club
20th Field Day

technological

pooled

interconnected

any

produce

o v

improvements,

decline in overall

volume

will

up,

abundant

discharge of this responsibil¬
ity," Mr. Phillips stated. "So far

contributing
are beside the
to-such

times

ful

that

of the country.
The most- press¬
ing problem confronting the man¬
agers of the thrift institutions to¬
day is the question presented by

troublesome item

the

fact

before

all

"Fast-m
made

The

accrue

out

$8V2 billion of brokers' loans,

touched

will

acted.

noncorporate debt
That burden of debt, of

match

Phillips

ity "to
at

determine

/
the
Club's
annual
publication/
emphasize the extent and "The Daily Bond Crier," lam¬
scope of .the industry and its re¬ pooning the entire municipal bond
made.
Defaults, like forest fires,
sponsibilities to the' nation, Mr. fraternity* go on sale at 3 p.m.
feed upon themselves until they
Phillips pointed to the tremendous today at the office of Ira Haupt
are
burned

Which

and

the

lines

sistent with good service.

well that this is the forest fire to

At the

and

respon-

i b i 1

dollars and in debts know all too

debt

corporate

6.3%

the most

constituted

•if

1929,

simple

deductible

taxes.

nings of trouble, in the shape of
defaults, and those who deal in

last statement, by itself, is
startling but the percentage
increases are even more startling.
In the eight years which preceded
the

transmission

balancing economics.

"(6) The use of types of fi¬
nancing similar to those employed
by groups of companies to pro¬
vide
capital to construct large
power
plants
and
transmission

filling its pri¬

"of" corporate

however,
If this keeps,

business
quence

burden

the

.extent that

J a

At the end
was

and

after

factors,

The

the
of

World

was

•Abstract

taxes

rather

can

and

local

$50 billion.

the

transmission

not

billion and today it is $304 billion.

extended and the government
can print the
money to pay

devil

our

the

prospec¬

possible cost to the customer

interest

•

close of World War II it was $141

itself

its

stood at about $125 billion.

pri¬

from

savings if

borrower and

not

enough

consider¬

apprehension.

total

and

over

World

vate
debt,
which
differs
from
public debt in one important par¬

ticular.

$275 billion and stands today at
$265 billion. At the beginning of

con¬

is the mounting total of

cern

harsh,

warrant

beginning of World War

sum

the greatest caution and conserva¬

time, particu¬

also

are

fact—to

-tremen¬

extend

tremendous

The Mounting Debt

only
of

are

able degree of

place

can

exercise

support,

These

over.

consequences

averted

mitigated

.lack

the

furnish

quired, by debt financing in com¬
because of its
parison to the rates required by
and has toppled
equity financing, and part to the
harsh words but

instability

oped

the
our

com¬

tition

supply of electricity at the lowest

the

transporta¬

mission

dous

on the part of the pub¬
equity purchases, part to
inordinately low rates re¬

and

"(5) Where long distance trans¬
is indicated, rail compe¬
and the financing costs of

electric indus¬

This fac¬

petition.

the

lic

blocks

fuel into closer

raw

of interest

great to be supported, has devel¬

debt

large

to be moved.

transmission

tion of

the

try is to meet

Part of this has been due to lack

too

future"

V:■ y mary

sons.

pyramid

inverted

which

—

clusion

Townsend

tric

reli¬

for

ance

heavily and for the following rea-

practically
inescapable. /in all our history has been pre¬
The reasons cipitated or accompanied by the
W. W.

"main

A little

not for another fact.

where

tor, combined with high load-fac¬
tor loadings, tends to
bring elec¬

energy
be the

facts shows very .clearly that bus¬ tive
require¬
iness today, is going into debt tool ments' for ful¬

and, in fact, on all of us. And every
disaster which has overtaken us

and

must

This would be bad enough if it

were

lowered

power are

electric power

80%.

was

vention

steam-

o n

that

conspiracy of circumstance over one-third of the new money
during the past generation has being raised by corporations at
contributed to the creation of more the
present time is not for plant
and more debt
until today the
expansion but for working capital.
carrying charges alone are a tre¬ And the sum total of all these

"ad-

that

steam stations

-L

In, the six
from 1946 to 1952 this was
During the last year this

78%.

against our sys¬

additions

improvements.

years

enterprise capitalism.

free

Convention

will be in

power must be the main reliance
of the future."

entire

dubi¬

year

has

business

into

and

However, and in spite of all the
lessons of previous history,- the

the

balance of this

ous.

Institute

power

using coal, and "steam-electric

con¬

back

which

criticism

valid

Electric

the fact that in the eight / C. N.
Phillips, Director of Re¬ located, in effect, at a mine-mouth
from 1922 to 1930 the debt search,/Ebasco Services, inc., New. with an assured
long-term, lowexpansion of the corporations of York, N. Y., told delegates attend¬
cost, raw fuel supply.
the country represented 60% of ing the Edison Electric
Institute's
"(4) The unit costs of trans¬
the total amount of funds plowed
t
/TlijuUUI
mitting energy electrically are

become

has

serious

for

Edison

cern

inflexibility of debt is the

The

first.

stated

will

cussion

which

basis

years

con¬

dis¬ pernicious and dangerous.

this

conclusion

creation

debt

Contrary to precedent and prac¬

tice/ the

Another

debts. Says when this^ credit ex¬

consumer

pansion stops, demand will decrease and nation
fronted with over-production.

much in another, by com¬

Phillips, Director of Research, Ebasco Services, Inc.,
delegates

future load growth in electric

parison with the debt increases of
the 1920's. '

and private

are

tells

four

times

much

almost

Mr. Townsend bases his view

EneigyfoiElectiicPowerExpansion

in--

debt

non-corporate

215

was

West

Seventh

Street.

formerly with Edgerton,

opera¬

Wykoff & Co., and Fewel & Co.
labor
ratios, and other cost-controlling
items will cause specific situations
Continued from page 2

tions

advantages,

different

vary from averages for repre¬
sentative conditions anticipated in
the immediate future, the speaker

revealed

the

general

findings

The

energy
transmission study
which hypothetically covers dis¬

Security

...an

tances

power

and

460
/

THE

OWNING

THAN

GREAT

SOUTHWEST

GAS

MICHIGAN

DISTRIBUTION

950,000 CUSTOMERS IN THOSE
INDUSTRIAL

CENTERS

AND

The

tion

listed

these

con¬

further price concessions,
experience is not likely to

repeated

face

two

fun¬

damental facts:

has

economic

been

first, that capacity
accomplished at much
cost
than
in
previous

WISCONSIN

COMPANIES' SERVING

advantages
large generating units installed greater
stations of great capacity are years* and second, that long-term
so
important that their use is in¬ growth of paper and paperboard
dicated wherever load concentra¬ consumption is well assured.
tions permit.
The Albemarle Paper Company
•
*
"(2) The mail?, reliance to meet is an old company with a brand

AN INTEGRATED NATURAL
GAS SYSTEM TRANSMITTING NATURAL

AND

voltages

which

Mr,'-Phillips
as:

I Like Best

700 miles, blocks of
3,600.000 kilowatts,

transmission

"(1)

FROM

kilovolts.

clusions

GAS

STATES

DETROIT

—

INCLUDING

AND

THE

future

load

growth

will

new

outlook

life

steam-electric stations using coal,

MILWAUKEE.
.

from all aspects

and

viewed

Preferred stock is my

its 6%
favorite se¬
their primary fuel.
curity. At current price of 85, it
"(3) Long-distance transmission yields a generous more than 7%.
cannot be justified
economically The stock is traded in the overlignite to

unless

the

limited extent,

generating

station

the-counter

of the

market.

case,

•

Volume 177

Number 5228

The Commercial and Financial Chronicle

...

A New Look aft

Development of P.U. Regulation,

Utility Regulation

President, NatT Ass*n of Railroad and Utilities

Commissioners

a new

not more

There

Middle

than

the

solution

economic

problems

far

the
invention of

duties

regulation.

ably

the

purpose

one.

can

with

cope

with

principal

national

industry, in

jLiigcue

any

Lougiwin

is to

trol

government and

threat to their

nomics—has

as a

force of

the

society

■/.

this

aspects.

The

interests

distinguished audience, how¬

the

new

personal conviction that

and

fresh

look

the

with the

processes

government.

by Mr. Loughlin before
Twenty-First Annual Convention of

the
Edison
Electric
Institute,
City, N. J., June 1, 1953.
r

the

public

•devised

public

con¬

demo¬

these

utility

affected

interest.

The

with

control

is the

independent regu¬
commission
which
has

latory
built up

istrative

mental

for

reforms will have

beneficial effect

most

the regulated!

utility industry in an overall im4
provement in the caliber of the
regulation under which it oper-*

estab¬

fundamentally
1869

ates.

More valuable

than income

tax

legislation, more important
than labor laws, more far-reach¬
duty of supervision and was di¬
rected to report its investigations ing even than changes in National
Power policies, would be the de-°
to the Legislature and to make
velopment of better regulation of
recommendations concerning com¬
utilities, properly divided between
pliance with charter provisions
Federal and State responsibilities,
and on safety matters.
to the point of strengthening pub¬
Of course, the present
day com¬ lic and investor confidence. For,
mission
with
its
comprehensive without sound
regulation there
powers
and responsibilities be¬
can be no really healthy regulated
gins with enactment of statutes
company and without good cor¬
in Wisconsin and New York in
porate health, the service to the
1907.
The
change in emphasis public will suffer.
from

the

punitive

almost

vindictive

and

Granger States railroad

commissions

1870's

the

A Century of Change

the

have

touched

the

fact

law.

whole body of admin¬

But the tedium of history has
place only of background in this
presentation. Like all background,

however,

we
tive unless it

The

regulatory agency came
into being not as a single compre¬

started

It does much

and
institution have

experiment

stayed to be an
been perfected.

would lose perspec¬
But, has that progress kept pace
were in the picture.
with the jet-like speed with which
to explain the pres¬
one
revolutionary development

ent situation of regulation and its
crowded the heels of another as
philosophical
concept,
"growth exemplifies the close iden¬ this nation came out of the dim¬
complete
in
detail,
but by a tity this social
phenomenon has ness of the
sputtering oil lamp
process of empirical growth.
with all our American institutions.

hensive,

into

The

regulatory

process

this

country traces its beginnings from

regu¬

early

had

with

terest of all the parties—the pub¬

economic

characteristics

utility

business

Atlantic

experience
what

was

bearing

our

people

that

the

know them

time

typical
of

the

today.

dazzle of the fluorescent

the

The

importance, then, of sound tube? In many cases the answer is
regulation to the public generally, "No."
to the industries it regulates, to
At the outset of an evaluation,
the- investors, small and institu¬
we are met by two
of the most
tional, and» the men who guide basic elements in
any regulatory
them is simply that it has suc¬
Continued on page 40
ceeded in preserving for America
*

•*

i//

•

[Land of Opportunity
7 hi

territory

the

covers

than

stretch

Louisi¬

and. Southeastern

extends

rice

natural

lands,

farms,

ranches,

sugar

forests,

fields, r'vers, bay¬

ous

and
this

Gulf

the

ike

wealth

Fertile

resources.

plantations,

industrial

square

abundantly rich

cotton

and gas

Texas

28,000

over

miles of land

The

mile

350

South-Central

across
ana

oil

the heart of

Gulf

great

here,

transmission

Gulf States Utilities

system of

Company,

pictured

the

land

Mexico
untold

agricultural

and

opportunity.

TRANSMISSION

Gulf States

SYSTEM OF GULF

STATES UTILITIES COMPANY

This, the fastest growing area in the United

supplies electric service to 292

States,

thriving cities and towns and the rich rural

offers

unlimited

opportunities

for

Invitation to Industry
*

\•

-i'*1

•

business and

along the Gulf Coast between Houston,

industry. Here is

ideal year-

■

Letters of
area

and

New

Orleans,

Louisiana.

around climate,

The

portation

Charles in Louisiana and Beaumont,

facilities,

with;, world outlets,

Orange,

water
large

transportation

;

Arthur,Navasota,

Gourde in

Texas

are

>1 Natural gas is also distributed by the
,: pany in Baton*
:*

cost

those served.
com-

supplies of oil,

.v.\-

electric "power,

chaap natural

gas

for

fuel, and the necessary nativO manpower to
make just

Rouge, and water iSJ served

to two cities in The system.

starting

a new

:t';

the combination

a new

■

*'■

x" '

V <<&>**-!

are

present facilities.

industry

relocating industry is lookihg for.

UTILITIES
V

furnish

opportunity!

GENERAL OFFICES,

plant, relocating an exist¬

ing plant or expanding
Here is

the service

Engineers and other trained and

sulphur and salt; adequate amounts of low

Huntsville : and

among

experienced personnel are available to assist
in

Port:

•

excellent rail and air trans¬
invited.

important cities of Baton Rouge and Lake

inquiry concerning the advantages

of this area
Texas

of;

commission, conscious of the growth of the regulatory proc¬
complementary and pervasive ess. Now, what has been the refresponsibilities of ensuring sound suit of this
century of change?
and efficient utility service at rea¬
Has it been progress? Yes, in an
sonable rates, was a more gradual
abundant measure, the technique
and less clearly marked process.
and
tools
of
performing what
its

.f n

served

modern

the

address

process

system

One

long overdue.
Furthermore, it is in the best in¬

latory

our

evolution

lic, the industry, and the investor.

ever, are sufficently broad and its
*An

It is my

come

manner

economic

industry-which
the

the crying need to improve and
breadth, the scope and his¬ strengthen this unique institution.
tory of the regulatory movement
My remarks will highlight some
are so great that to deal successof its most striking characteris¬
fully and clearly with it in this tics,
always with the purpose that
limited time demands that I con¬
through an increased awareness
fine
myself to
only the most we can improve upon the system.

salient

intricate

industries

The

character

measure

devispd

and

cratic

and

most cherished institutions.

that

commission to

Although

unlike and weaker than the

internal prob¬

significance in

American

and

eco¬

our

life

was

slow

over¬

whelming influence which utility
regulation—as an instrument of

commission

Massachusetts commission, it was
nevertheless charged
with the

fundamentally consistent with the

govern¬

the

privately-owned utility

transportations system.

not without significance that only
in America, where regulation has

the first permanent

purpose,

lished.

not"

essential. This form of social

myself

clear and simple

dramatize

free and

railroad

social control of them has become

the

executive

dedicated

complex

to assume such

ment and in the investment field.

that an enlightened free
people

its

have

shalt

lems, have from time to time

making these thoughts known
the public, and to responsible

men

demonstration

.conclusive

office,

machinery

J There is prob.

Commissioners

"thou

the

and with manifold

today, and ever since
honored by the National

ties

beyond

cupations,

in my

thoughts which I leave

Association of Railroad and Utili¬

through

and can probably be considered
indigenous to the English speak¬
ing world. During the course of
the development of our economic
society, various industries and oc¬

the lines.
over

and

move¬

permanent

that

stage. Regulation today has posi¬
tive powers of initiation as well

cus¬

you

being

utilities

the

with

the

between

have long turned

mind

public

our

be read

and

original
oppression,
regulation has

matured and its powers have gone

probably
no
more familiarity with the subject suf¬
striking demonstration of the suc¬ ficiently intimate that these nec¬
cess
of the American system of
essary omissions, I am sure, will
the social

early

granted

economic

institution

the

government

the

have followed the develop¬
ment back to my own state. As

the

From

Ages.

reaction

regulatory climate—not too stringent nor too genimportant factor in utility management. Holds better,
regulation is the key to progress and calls for mutu¬

ally cooperative attitude by companies, Commissions, and
tomers to cement a
stronger utility structure.

ment

the excesses of capitalistic liberal¬

and fresh look at the regulatory processes for
long overdue, Mr. Lough!in reviews development of
public utility regulation, and concludes good regulation or a
-is

the

course, was

Students

1832, Connecticut had developed to the highest refine-,
special railroad charter ment, of all the countries in the
ism developing out of the funda¬ and created a special commission < world, is the rail transportation
to
ensure
compliance with its system still in private hands. My
mental
change in political and
1849, Connecticut set personal belief is that the govern-1
economic philosophy following the terms. In

utilities is

erous-

business, of

railroad.

organized independent regulatory
agencies was the result of the re¬
actions of independent people to

Chairman, Connecticut Public Utilities Commission

favorable

That

This thing called regulation by

By EUGENE S. LOUGHLIN*

Asserting

(2523)

COMPANY

BEAUMONT, TEXAS,1 BATON ROUGE, LA.

(2524)

The Commercial and Financial Chronicle... Thursday)

Continued

from

organized labor needs to protect
workers' rights and enforce
legitimate
demands
of
their

page

summarily

the

More
I

hope

unions.

Picketing

responsible citizen, let against

Picketing is
of

form of freedom

communication

pay

for

this

the

price

freedom

other freedoms in

that

and

interests

someone's

for

democracy is
may

adversely affected.

Moreover,
the picketing itself is designed to
protect a vital interest of the

by way of shelters against
union activity. In this setting the

Cleveland 1, Ohio
Relative to the subject

eting, I believe that
who in

picketing

these

low

fraud.

wage

that

has

The

nated

real

interest

activity.

their

Moreover,
of

its

picketing which

the announcement

purpose

the

private
economic
has
ophies. Indeed the state

fact that

so-called

third

party employer is profiting b,y the
sub-standard labor conditions of
another employer is also a socially
defensible
activity.
I
use
the

"so-called

term

third

Congressman

South

from

While I

Carolina

labor
I believe that in

plant

should

case

picketed

think

his

the

written

the

law.

the

i d

e n

suggest

White

in-

any

one

forces
cure

low

unrestricted

Taft-Hartley
more

wage

law

license

stringent

se¬

comes

via

the

privilege.

enact

even

prohibitions

these

should

cir¬

abuse

than

worst.

People

who

are

paid

all

that

the

right

weapon

that

either
or

Taft-Hartley
picketing
il¬

legal.

cowardice

should

issue has

There's the Florida of
"Super Colossal*
vacations where more
people have

fun-in-the-sun...all

year'round...than
on

any¬

earth.

the spirit

...for Business
while

here

There's anofher Florida...a forward-

looking, aggressive state with a sound
and expanding
economy...based on

you...

air...on
serve

fast-growing markets.

when you come for
for a lifetime

continually

believe

move

that

this

throw

not

strike?

all

desire,

the

that in most unionized plants this

prevails.
involved

tiations,

rights are
when, in contract nego¬
the Union and Manage¬

are

rates.

this—as

should,
at the

can

few
A

cents

apart

controversy

well

and

all

must

such

others—

settled

bargaining table by honest,

fair-minded

representing

men

both sides.

LIGHT

COMPANY

represented

few

unreason¬

able men—as has Labor.
a

few

years

would,

are

settled

Were I

believe,
me feel degraded and small
seen stomping around in all
man

make
to be

with a sign on
Furthermore, the vio¬
lence
which
frequently attends
picket lines does the unions more
harm than good. I have had sev¬
of

sorts

weather

back.

eral

union

tell

men

that

they,

too, feel as I do.

C. A. NORRIS

President,
Gold

Mining Co*
Calif.

Francisco 4,

always regarded picket¬
it has been conducted here,

national

disgrace.

not

If union
continue

care

under

right to

test

be per¬
mitted to pre¬
vent or e v e n

threaten

life,
liberty and
pursuit

ago

Norris

happiness
of
any American
from earning a livelihood by any
honest or peaceable means.
That
may sound a little old fashioned in
the light of what has been con¬
doned in this country, either le¬

otherwise, for

the

best

part of a half century. It has not
altered

changed

views,

however, in the least, and I have
spent the greater part of my own
life

employee in

one

form

do not believe that

any

self-

another.

respecting working
the idea of

man

relishes

doing so-called "picket

duty" either.
Our country
ruled
labor

has been too long

handful of irresponsible

barons;

the only

Management has at times been

union

I do not think human

ment

POWER

at the conference table.

gally

prosperity
working man
must earn a good day's wage for
a
good day's work, and I think

not

Baker

standard

human

wage

^E^MORETOJ^V

our

In order to retain the

vacation...look

opportunity...

are

business

should

which

"strike," but
they should

up a picket line
rights, and, if the
marching, what about
human rights of the people

secure

pickets

union and

matters

means

is to

essary
to

the

tween

pro

Labor and Management it is nec¬

who

especially by
rapid industrial development

as they see fit in their re¬
lationships with such struck insti¬
tutions. After all, the issues be¬

have

land

not

with

them¬

employment,
they certainly

enlightened day and age of gen¬
erally good relationships between

livestock growth...on

commerce,

dou/n...

served

conduct

selves

conditions

it should.

can

their pay and

indus¬

the

institutions.

thus

are

notice

work

and

living

amazing agricultural and

increasing trade and

who

such

can

ahead
I

yoti are

Those

people

vast

business

plants

ing,

promoting the

...for Pleasure...

to place an adequate notice in a
prominent position before struck

tries

ob¬

I have

bor and Man¬

operating

rights and civ¬

I would have

jection to strikers being permitted

San

La¬

partners

property

Wagner

il liberties.

must

of¬

those

who believe in
Richard

Alaska Juneau

It is my

and

irri¬

and

fends

make

fairly

that

the

tates

ever

agement

FLORIDA

lieve

cer¬

satisfac¬

tion

of strik¬

contrary, I be¬

through physical inability knowledge,

moral

Act

the

ers.

tain extent in¬

enforce the law and do not do

seems

strike

rather

that

much

Picketing
does to

the

by
our

very

cause

business
have

same

line.

ume <nv

doubt

cumstances.

firm convic¬

moves

certain of

plant

in¬

citizens.

torily
settled
by a picket

So any time

dulged

helps-

under any

been

where else

actions

ing

that

and

most

un-American

are

areas

is one

the

picket¬

privilege of inserting an ad¬
putting on picketing via the
vertisement in the local paper,
fringe on prop¬
cause,
injunction are patently designed,
in these situations is not
erty
rights
carrying a radio program or mak¬
really once
again in the history of our
and civil lib¬
a
neutral at all. Let us suppose,
ing talks to its own employees
country, to destroy legitimate selfWm. J. B. Dorn
erties. A union
for example, a situation in which
about its side of the particular
'
help weapons of working people.
to warrant its
an
incident.
enterprise
is
selling
goods
Ironically,
these
restraints
are
existence should be strong enough
produced under sweat-shop con¬
It is my belief that when pick¬
being enforced precisely in the
and
have the confidence of
ditions. The enterprise is picketed
its
areas where union
organization is eting becomes mob violence, com¬ members to such an
extent that
by the union whose standards are
pletely blocking the entrance to
most
urgently
needed
to
raise
being undermined by the sale of
a
place of business, when people picketing would not be necessary.
these products. The owners of the working standards.
are
clubbed who try to enter a Picketing to my mind, is an ad¬
I cannot believe that restrictions
enterprise are profiting by the ex¬
mission of weakness and lack of
on peaceful
picketing can be jus¬ place of business, when the pickistence of these substandard con¬
almost
unanimous
endorsement
tified as either good public pol¬ eters throw stones through auto¬
ditions. There is, therefore, in these
mobile
windows
and
generally among the workers of a strike.
situations a definite unity of in¬ icy or as good law in a constitu¬
terrorize a neighborhood, immedi¬
I
would not go so far as to
tional democracy.
terest between the non-union em¬
ate action should be taken
by the outlaw picketing by an act of
ployer and the distributor of the
regularly constituted peace offi¬ Congress, but I think a law should
L. F. LONG
non-union product.
The latter is
cers
to
completely disband all be passed outlawing picketing ex¬
clearly not neutral.
President,
pickets.
cept
where
endorsed
by more
The Cudahy Packing Co.,
One of the most
alarming ten¬
Proper presentation of the facts than two-thirds of the workers in¬
Omaha 7, Nebraska
dencies, in my view, in the labor
is one thing. Violence and coer¬ volved.
relations field is the substantial
I, personally, do not feel that cion are
something else entirely.
degree to which the Taft-Hartley the right to picket is essential in
We have seen Communist-domi¬
law and, even
G. T. BAKER
more, state legis¬ making the strike weapon avail¬ nated
picket lines become unruly,
latures and courts are
eroding the able to Labor effective.
On the s t o n
e-throwing, automobile-up¬ President, National Airlines, Inc.,
right of peaceful picketing.
Per¬ other hand, I believe that picket¬
Miami 42, Florida
setting, skull-cracking mobs too
haps the most significant under¬ ing is definitely an
infringement often in this country. We have too
I
believe
I
understand
the
current in the present
attempt to on property rights and civil lib¬
many instances of officers of the thinking of both those who favor
revise the Taft-Hartley law has erties because
it is so frequently
law, both city and county, turning and those who oppose
been the efforts of
amending
pro-sweat-shop used in such a manner that it be¬ their backs on mob violence at its the
party" be¬
in context, the tnird party

picketing

Union

and

where. Equal¬

ly,

practice

also,

they deal else¬

establishments

the

into

American I have always felt that

doubt the wis-

particular

nevertheless

facts

not in any sense a

expert,

this

should

friends

injunc¬

restraints which these state courts

public

tion in labor disputes is being re¬
vived as the chief weapon against

peaceful picketing and this judgemade law is making a shambles
out of the right of picketing.
The

President, The Chicago Corp.,

Chicago 3, 111.
U.

hair-

tell

WAGNER

RICHARD

bank

complex controversies

The most

between Labor and Management,

HON. WE J. BRYAN DORN

neighbors, his

philos¬

changed, I hope.

ened out forthwith.

during a
dressing
establishment strike without a majority vote of
has the right the Union membership involved.

decent

have

few; but I

that

cluded

when they are really partners, can
enforcing the law at the exist¬ be solved
by approaching
the
ing salaries of people who are situation
absolutely honestly by
occupying the jobs but who are
determining
"what's right"
in¬
not qualified to hold them.
This
stead of "who's right."
evil situation should be
straight¬

any

men of integrity and cour¬
in this country who are per¬
fectly willing to take on the job

manu¬

store,

from union

Implementing
the
legislative
anti-picketing drive is the in¬
creasingly promiscuous issuance of
wages
and
working conditions.
restraining
peaceful
These interests deserve, I suggest, injunctions
a
high priority on any scale of picketing by state and local courts.
these courts are
social and moral values in a de¬ The judges in
making law on picketing based on
mocracy.
workers—their

able

bodied

against

facturer,

drive to insulate

areas

have

discrimi¬

been

property issue is

versus

transparent

of pick¬

any employee

legitimate labor dispute

ers

issue focuses

thousands

President, Republic Steel Corp.,

feels

dismissed.
and

age

C. M. WHITE

peaceful

picketing than
me
set down what I consider to are contained in the Taft-Hartley
be controlling social and
moral law itself. The end object of these
principles aftecting the right of efforts is clear. It is to provide
inducements to low wage employ¬
picketing.
•
as a

thousands

June 11, 1953

war

economy

thing that has prevented

complete collapse of

our

economic

structure.

Up until

could

in¬

Continued

page

Commercial and FinancialThe
Chronicle

Number 5228...

Volume 177

pointed out,
could

Interesting Tax Rulings
Attorney and Counselor at Law, New York City

(2) restraining collection of taxes;

returns;

(3)

property in joint names for estate tax purposes; (4) using a
trust for $3,000 annual gift evasions; (5) disallowance of tax
deduction for excessive compensation;

(6) loss carrybacks in

relation to prior year frauds and deficiencies; (7) educational

of practicing professional men, and (8) travel ex¬
between home and business. Calls attention to tax
changes now under consideration.

expenses
penses

amended

retroactive

returns

effect

even

government seeks to lien, seize or

tirety

sell,

cedent's estate will be taxable to

the

are

cases

most

which

such

Restraining the Collection of

facts

Taxes

time made

sufficient.

The unfortunate thing,

when

recurrent

he is

re¬

veals that:

and

non

expenses

1,600

Revenue

cases.

tax

in
Of

volved

have

252

tertainment

and

320

medical

return.

(e)

Wolder

original

due

date

of the

in¬

gether,

Courts

return,

and the amended
consideration.
In

cases.

Depreciation issue,

cases.

•Material prepared by Mr. Wolder for
pa
address before the Westchester Bar

Tax

Section,

New York, June 8, 1953.

White Plains,

timely;

the

that

says

purpose

assessment

re¬

col¬

any

where

the

deficiency as¬
a
jeopardy
kept in
mind, however, that the Judiciary
will under certain extraordinary
and exceptional circumstances in¬
voke
injunctive relief, notwith¬
standing the statutory restrictions.
Each
case
depends on its own
facts.
Injunctive relief will not
be granted on the general princi¬
ples
of equity.
The taxpayer
other

assessment.

but the Commissioner of

the

it.

As one

who

than

should be

tax.

third

the

Court title

is supposed

owe

party who

the

claims

property which

asset

the

asset

the

is, then the decedent's

accomplished

may

said

there is

Using

general

This

can

the

problem.

Trust for the $3,000

Annual Gift Exclusions

proposition that too many people
still are under the impression that

Gift tax laws provide that

each
right to make gifts
be administered as part of their in the aggregate totalling $30,000
estate upon their death, that it free of tax.
When the person's
does not have to be included in spouse joins in the gift tax return

if their property does not have to

person

their estate for Federal estate tax

the amount becomes

Such

purposes.

rect.

view is not

has

$60,000, free

of tax,

regardless of whose prop¬
erty is transferred. In addition to
this, each person can make an¬
nual gifts not exceeding $3,000

cor¬

accomplish this incorrect

understanding, they will, for ex¬
ample,
put
property
in
joint
each to any number of people,
names, with right of survivorship.
Thus, a husband will take prop¬ free of gift tax so long as no gift
erty in the joint

names

of his wife

This

one

definite transfer

estate will be bailed out.

Property in Joint Names for
Estate Tax Purposes

Commissioner pre¬

maturely makes
sessment

amended return

Internal Revenue may in his dis¬

cretion

interest

other party in whose joint name

provision about not re¬ and himself, or a person will cre¬
on
Feb.
18.
I
would
say
the straining the collection of taxes ate a bank account in joint names
500 amended return is timely filed. If has been held by the Courts as with some one else, or create a
it is filed after March 15, it is not applying only to the taxpayer, the so-called "Totten Trust" bank ac¬
an

decedent's

creating a
tenancy in common instead of a
erty from the government, but joint tenancy or a tenancy of the
only the amount the government entirety. Of course, this is a prob¬
realized on the sale. There is no lem which everyone must deal in
his own private way; and so long
condition
that
the
government
as
there is compliance with the
must sell for full value.
requirements of the gift tax laws,

return
given
other
"must make out a case of gross
words, a calendar year taxpayer,
raised who has until March 15 to file a and indisputable oppression with¬
final return, files one on Jan. 30, out adequate remedy at law."

was

cases,

Association,

The

consistently

(d) Capital gain and loss issue and then files
In 600

any

then both returns will be read to¬

(b) Dependency credits
volved in 1,050 cases.
1,000

there

amended return is filed before the
Victor

expenses.

taxpayer's return. It would be
opinion,
however,
Jthat it

e n-

expenses

Nor

any¬

income

held that the
first return of the taxpayer is the

travel

expenses,

says

amended

specifically

for

shall be main¬
Court." There are
a
few statutory exceptions, such
as
the posting of a surety bond,
tained

taxpayer has to file

amended

involved

return.

right which

these, 450 in¬

which

Code

thing about

business

suit

lection of any tax

Amended

There is nothing in the Internal

for

business

Code

enue

"no

Returns

ductions

officer employee,

stockholder.

No Right to File

dis¬

allowed

active
as

straining

(a) The Com¬
missioner

well

interest

come

closely held corporation of which

months

in the property at the time of his
death. Thus, if the decedent had

Another type of case which is
taxpayer is sold out by reason of
Constantly cases come before a tax which is eventually proved
before very frequent, is the right of a
the Court in which the collection to be non-existent or
the United States Tax Court?
A taxpayer to deduct as a bad debt
unenforcible,
of taxes is sought to be restrained is that the
study of 9,000 petitions filed in a loss resulting on a loan to a
taxpayer cannot re¬
by injunction. The Internal Rev¬ cover the full value of the prop¬
the
last
15

What

type of

created, then the de¬

was

extent

paid the entire consideration for
the asset, then its value will be
taxed 100% in his estate and, if he
turn.
tions or is invalid is not sufficient paid only part of the purchase
If the purpose of the amended grounds, standing alone, for grant¬ price, then his estate will be taxed
return is to reduce the tax as¬ ing
a
restraining
order.
But only on his proportionate share.
sessed on the original return or where the imposition of tax would Now one of the ways to get around
to exercise a revocable right of have
destroyed
the
taxpayer's this is to do something about it
while the decedent is alive. And,
election, make
sure
to
file
a business, ruined it financially and
timely claim for refund. The re¬ inflicted a loss for which there if it can be shown by deeds or
fund
claim is the proper pro¬ would be no adequate remedy in other
appropriate
instruments,
cedure, not the amended return. law, the Supreme Court has held that the decedent during his life¬

Mr. Wolder discusses various aspects of Federal taxation that
have come before the courts, among which are: (1) filing
amended

can obtain a restraining or¬
though not timely filed, a false der.
Likewise, relief has been
original return could be corrected given in case where third parties
years
later by an amended re¬ claimed priority of lien over the
turn.
Or, an irrevocable election government.
made in an original return would
The mere
fact that a tax is
be modified by the amended re¬ barred
by the Statute of Limita¬

By VICTOR R. WOLDER*

(2525)

count.

his

tenancy by the

other

words,

man

grandchildren each year, Or

total of $27,000 each

gifts of $3,000 each to

wife, his three children and

five

stood that, if property is in joint
or

could make

It should be clearly under¬

names

so-called "future interest" is

made.

Continued

en¬

free of

year

page

VEPCO, A PUBLIC UTILITY
Vepco stock is widely held by the Public — in fact, it is held in every State
Men hold slightly more Common stock than women, but the
women hold almost twice as much Preferred stock of Vepco as do men.
A

in the Union.

breakdown of Vepco stock
••'

holdings shows the following distribution:
"

Common

Preferred

Stock

•

Stock

1,038,822

41,767

Women

922,011

74,617

Joint Accounts

157,295

3,797

464,892

41,871

Men

Trust

Accounts

1,421,538

Institutions

Total Shares

There

are

201,915

5,441,034

and Others

125,504

1,436,476

Nominees

489,471

about 22,000 holders of Vepco's Common

of its Preferred stock.

stock and 7,800 holders

Nearly 10,000 of these reside within the area served

by the company, which includes most of the State of
West Virginia and of North Carolina.
These

Virginia and parts of

stockholders, through voluntary investment, have

helped make

possible the large annual construction programs of Vepco, particularly during
the past seven years, during which time the company has more than doubled
its generating capacity, which how totals over 1,000,000 kilowatts.
And,
approximately $40,000,000 more is being spent this year by Vepco for more
power station capacity at its Portsmouth and Possum Point stations and pn
its new hydro development on the Roanoke River, where the Free Enterprise
system recently won such a notable decision from the United States Supreme
Court.

UPPER FIGURES

These

No. of Shareholders

in them,
the

LOWER FIGURES
Total Shares

new

if they

projects offer further opportunities to the Public to
see fit.
Those who do not see fit will not be taxed to

projects possible.

PS.

—

A copy

our

Annual Report will be gladly mailed upon request.
V

VIRGINIA

ELECTRIC

AND

invest
make

POWER

•

■

'<?;■£

>*i
*■

COMPANY

The Commercial and Financial Chronicle

(2526)

that indicates to me that a

Lending
Municipal Bonds

Uiban Mortgage
And

The

lenders and

This

expanding tax-base of urban areas. Looks for
downward readjustment in building within the next year, and
values and in

the

housing starts.

new

again be exceeded this year.
This year may, in
fact, be the
second biggest building year since
the

given to

the

interest

reas,

have many problems
and
opportu¬

nities in

sav-

and loan

ings

•

com¬

Our

mon.

i nstitutions
have

enjoyed

remarkable

growth in

re-

cent years,

will

community

from

vary

community.
Today I would like to go over
of the ground

some

which serves
place be¬
yourselves and the savings

for

reasonably high

points of mutual interest be¬
the

tween

finances

handle

who

men

the

government

who

men

and
Morton

ome

than

financing

groups

1930s.' By

new

Realty Values

first

was

This

point

important

ence

at the

new

other

munity. It is true, to be sure, that

lenders

the

have this interest for

varying

combined.

within

You

reasons.

A second

com¬

postwar peak in 1948.

have

profound influ¬

the

affect

volume

interest

closely related

this

basis,

expect that

reasonable

downward read¬

want

men

the

estate

major

institutions have, in short,

our

is,

sources

municipalities

communities.

revenues

which

you

tax

revenues,

analysis—the
institutions prin¬

Real

among

course,

to be assured of

the

to the

integrity of our
cipally rests.
Now, what

men

for

pects
*An address

by Mr. Bodfish before the
nnual Convention of the Municipal Fice
Officers Association, Miami, Fla.,

stability

the

pros¬

real

they

say

quite

are

nothing

optimistic.

the horizon

Local

Municipalities
This

the future

are

estate market? In general, I would

There

June 1, 1953.

Means

poses,
your

will

mean,

for your

that from 1954

pur¬

1955 on,

substantially
slower rate than they are today.
It means, too, that instead of an
a

fair

block home

that

statement
have

helped

building in the central

city and aided the rise and growth
of

suburban

communities.

Problem

Still

Curbing Blight

another problem

resisting

maintaining

and

among

that

adequate

common

standards

housing

residential properties.
and loan executives are

our

Savings

sanitation

local

I need not dwell

dropped

plight of

the days of the

The

had

bottom

the

out

the

real estate during

Depression.

government.

market,

the

mortgage structure had been vir¬

safeguards for health, safety and

*■

not adopted and en-

are

the

ihen

iorceu,
t

neighborhood

after

threatened.

yourselves, this is
cents

real

value

neighborhood

problem,

For

dollars-and-

since

tax

your

tually frozen, real estate transact

revenues are

tions

once a house, or a group of
houses,
begins to deteriorate badly. From
my own experience in Chicago, I

and

volume

the

and

home

rapidly.

unable

meet

they fell due,

their local real

pay

The

taxes.

declined

result

estate

confusion

was

turmoil, and widespread fore¬

funds

job

vigorous

chance

this

happening

than

based

problem

was

due

use

the

mortgage,

the

early

almost

straight,

short-term

the principal of which

fell due every four

have

five

years.

good

enforcing

mini¬

offset by

higher

reve¬

increased valuation.

would

1930s did

universal

additional

doing

Financing for Local Government

again. Much of the terrible mort¬
gage

standards, the cost would be

mum

Frankiy, I do not believe there
a

that

spent

were

nues

promptly endangered

convinced

closures.

be remiss, indeed, if I
emphasize that we have

not

common

in seeing that there
financing for our local

cause

ample

governments.
that

many

frank

the

say

savings

the

long-term and loan business look forward to
amortized loan (pioneered before the
time
when
our
institutions
the crash by some savings and
may be of greater
assistance to
loan associations) which provides
municipalities
in
meeting their
for an orderly month-by-month problems of
financing. Our insti¬
tutions are; after all, local institu¬
liquidation
of
the
outstanding
we

tions and

our funds
belong to the
people in the community.
It is
logical,
therefore, to anticipate

the time when

of these funds

be invested in local govern¬
ment for the improvement of the
may

community.
In

almost three-quarters of

ties for their borrowers. This plan states,
savings associations
charters
has provided a new source of pro-1 state
already are
mitted to invest in
tection
for
the

borrower,

lender and the local

residential tax rolls will be

expanding

and

functioning

justment in new building will set
orderly receipt in
probably next year, and will
based on real continue
ecome a far more significant part
through the remainder of mortgage. We have, I think, also
estate valuations, upon which you
this decade. Instead of the current licked the
the financial structure of many
inability of cities to
can
project the fiscal operating annual
immunities than ever
production level of 1,000,- collect real' estate
befo^p. In plahs of your local
taxes, which
igovernment. 000 houses or
a very specific way—by virtbfc of
better, we will, see contributed 'so much to the chaos
We in the savinfs and loan field,
a
he fact that about 80%
of our
varying range of'building of of the 1930s.
Today, more than
meanwhile, view this stability as from
assets are invested in home mort¬
750,000 to 950,000 annually 85% of "our institutions collect
the surest means of safeguarding
through the last half of the 1950s. these taxes each month and then
gages—we have a great and abid¬
our real estate investments, upon
ing interest in the future of real
pay them to the local municipali¬
which—in the final
What This
Our

delays

revising

acutely conscious that if effective

Today

home building.

slightly

than half what

difficulties

minimum

great point of mutual

first, and that is the provision of
a
regular flow of funds for the

housing demand, and

certain

estate

mainly

new

family formation will be

will

mutual interest is the stabilization
real

the late 1950s, the rate

probably not

any

mortgage

The

are

rate

result of the low birth rate of the

com¬

tend

housing demand is the

declining

formation,

family

run

respon¬

sible for

,wo

within

reduce

current

savings and home

done

Stable

cities,

they

today

Bodfish

will

which

factor

blight
Government

for Local

Funds

officers.
cities

many

serious

encountered

obstacles

these

influence

the housing industry is con¬
siderable—to say the least.

reasons,

modernizing their building codes,

upon

tant

housing shortage.

radically by

whose

Government,

Another

longer

have

by devices of the Federal

war or

various

and

it looks

in sight. It could,

factors currently

try. There are a number of impor¬

practical purposes, that there
no

billion.

of course, be changed

were

new

roughly

today, and based on the economic

Families

your

7,600,000

picture

their mortgages

savings

than

houses and

the

financing
munity.

the

built

have

imply

and $81/2

$7%

all

the institutions which have charge

This

and loan associations of the coun¬

tween

of much of the

tion

not, however,
that the present
unusually high rate of building
will
continue
indefinitely.
We
I

years.

mean

between

will

1960

had

ing

rising propor¬

the next

and

building

meeting

common

community, and the

ever-

few

and

1955

finance

municipal

For

apartments since
World War II and that means, for

they are hold¬
an

rates

judgment, the prospects

good

are

busi- represent, although its importance

loan

and

savings

the great bulk of our assets
in institutions located in urban

with

billion for new residential build¬
ing such as we will have this year,

impetus

GI and FIIA loans.

occurred in the 1930s.

the

construction by the

new

increases

recent

because

war

level of home building in
In

and

past four years,

will

predicts Federal Savings and Loan Associations, therefore,
will, when given authority by Congress, invest funds in mu¬
nicipal bonds, thus providing for them an additional chan¬
nel of investment. Stresses need of good local governments,
and foresees no likelihood of collapse in real estate values

tess,

for

eclipsed

been

has

mark

each

municipal finance officers in supporting real estate

931,000

were

attention to mutual interests of mortgage

such

expenditure of nearly $10

annual

of unprecedented

been

proportions. Prior to the present
boom, the biggest building year in
our history was 1925, when there

United States Savings and Loan League

Bodfish calls

building

home

postwar
has

boom

Mr.

Building Boom Continues

Home

Chairman, Board of Directors
"■

slump is anywhere in

estate

the offing.

BODFISII*

By MORTON

serious

the overall amount spent between

real

.Thursday, June 11, 1953

The

Future

municipality.

the

Another important point of mu¬
tual interest and

the

between

concern

finance officers

However,

tions

commu¬

with

—

about

Community

55%

total of

assets

per¬

municipal is¬
Federal associa¬

the

sues.

our

with

the

comprising

business-wide

approximately $24 billion

far have not been allowed to

—so

participate

these

investments.

The
United States
Savings and
institutions Loan
League currently is seeking
may be generally referred to as
this authority, and we are
hopeful
"the future of the community."
that it will be granted at an
early
Under
this - heading,
we
share date. I believe it can be
predicted
many objectives. One of the most that
savings associations will play
fundamental is the desire for ad¬ a more

nity

and

its

savings

THE DELAWARE RIVER VALLEY

prominent role in financ¬

equate financing so that there

Industrial

History is being made in the Delaware River Valley

where much of the nation's

Trenton, New Jersey,

ufacturing plants and

history

to move

over

here and

are

many

immeasurably

than 8,000

area.

business
man¬

Others

our

ever

has

progress

strong and

maae

self-sufficient

are

tive

far

also

better,

the

effective

more^

building

possible for

virtually

residential

recent

basic

modern
and

speak from experience

Delaware River Valley will

and

planning,
zoning.

decades

Vice-Chairman

objec¬

(and

area

is available for

Public

unfortunate
of

from

the

city

the

over, city plan¬
engineers to the

the

physical

problems

their

communities, many of the plan¬
ners
today are more concerned
social

issues

such

racial

relations, public housing, the in¬
comes

like.

ELECTRIC COMPANY

With

savings
your

ible

funds,

anxious to

prudently1 and

commend

and

see

'you

these

safely

in¬

this/comment,
attention

your

loan

institutions

community if they
depositories.

are

the
in

elig¬

Common
ment

the

change

of. public
are

Goal—The

Good

Achieve¬

Government

The other great point of mutual

interest

good

can,

stated.

think,

the

simply

achievement

government.

Such

achieve¬

ment is, of
course, the principal
objective of your efforts. In our

savings and loan field, we recog¬
sociologists. Instead of sticking to
nize that upon good government,

with

ATLANTIC CITY.

funds

Chicago
Plan Commission) there has been

ning

bookings. Write

gentlemen

1 -A

planning. The
change is what might be called a

Relations Department.

custodians

former

as a

shift in dominance

A color film of the

municipal

;

vested.

city

standards

During

increasing industrial

healthy nation.

live and

financing is concerned.

character

Jersey and the

many communities to be

the continued growth of southern New

in the

progress

operations

Probably this is as good a point
as any to point out that
municipal
that governments can
help to finance
the growth of the savings and loan
-vavihgs and loan associations. As

Many of the "name"

located in this

government in the years ahead.

the

work. I think it is safe to
say

of those already in the "Valley"

Geared

the productive capacity of

contribute

are more

new

ing

new

building,

new

communities in which

written, dn the "Valley" from

5,000,000 residents.

have expanded their facilities.
tempo,

was

Lewes, Delaware,

corporations of the United States

planning

constantly be
development,

may

The

planning
ment

various
result

groups,
is

and

that

the

actual

injnrgp

our

part

..real—estate

the integrity
investments,

and, in turn, the savings intrusted
to

by~~tne. peopleTof the

munity.

objective"
work

this

which
the

com¬

very practical
motivates
the

Civic

Federation

for

has

physical improve¬ Chicago—which I am privileged
lagged^ badly in many to head—and many similar organ¬

cities.
The

rests

izations interested

government

constant

improvement of efficiency and progress, and rep¬
building practices and standards resenting the point of view of the
is another objective we
in the taxpayer.
savings

and

loan

business

have, of

course,

long believed

Volume 177

Number 5228

The Commercial and Financial Chronicle

...

(2527)

that

alert

interested

and

citi¬

too, it
est
at

may

and

for those

public
reward

jobs and
their work. Admittedly, arousing
public interest in local govern¬
ment is

easy assignment. Dur¬
ing the last two decades, first be¬
cause of the Depression and later

World

aftermath,

the

War

and

attention

its

the

American people has been largely
turned to Washington.* The trend
toward ever-greater centralization

blamed

principally

tue

Financial

of Phila¬

to
to

analyst
who
heads
M.
A.

sure

Analysts

;

the

enable

the

'loaned
and

York

in New York

the

that

tndc

banks

subsequent

Because

the

up'; position at the banks,

Co., Inc., New

City,

success

issues.

especially tight situation

City, it is apparent

without

this assistance from

continuous period of national cris¬

tne Federal

ther m-onetary

is;

Reserve's

would be unable readily to absorb

however,

have

intensified
some

honesty

would

the

surrender

responsibilities by the states

and cities.
j

all

admit this trend has been

tion

the

during
recent
days
supplying
credit

ac¬

preparing for this speech, I
happened to run across some sta¬

purchases

est

you

much

will inter¬

sure

they did

me.

limits

ities of the situation

strates

Today, that ratio has

been almost

exactly reversed, and the national
government has expenditures

ning in

excess

run¬

of three times those

of the states and
Trmnicipalit.ips.
It is possible that we are now

about to

this trend, and I
all those who

reverse

confident

that

believe

in strong, effective 1 local
self-government will salute such
a

reversal.

Within

few months,

President Eisenhower will appoint
a special Commission
which will
look into the various
programs in
which

Federal aid

extended

states

and
municipalities.
I am
hopeful that out of this Commis¬

sion's findings will come
ber
of
recommendations
will

der

vast,

retijrnsome appropriate

functions

andacttvitiesi>>>solely to

men

are,

that the

and local

the

effectively
men

that you

are

public
and

treme
a

would

position,

and

policies
"It

demon¬

continue
now

able to

funds

just

efficiently

Federal

banks

"But

bor¬

pegged

told

represent

market,

financial

Mr.

cline which is

ex¬

undesirable

Government

are.

sential
'

credit accommodations.
of
the
Federal Re¬

"In

cently

view

policy, the question again
arises as to whether it
might not
be timely to lower reserve re¬
quirements in New York and Chi¬
cago.

Officials
Co.

deposits in a declin¬
ing trend, there is general agree¬
require¬
dis¬

Charles

management

Larson.

Mr.

said

so-called "free"

but

ever-tighter

market

invest

their

porarily

idle

bills,

quences

omy.

the desire of business

intolerable, inviting conse¬
unsettling for the econ¬
.;
•
'* "

money

well

large

funds

national

■'

of William M. Hess. His

the

securities

business

Au¬

gust.

Cleveland Analysts to ;
Hold Fall Conference
CLEVELAND, Ohio—The Cleve-'
Society of Security Analysts

land

will hold

"Great Lakes Confer¬

ence" Oct. 13th and 14th. The pro¬
gram

will

management
as

include forums
conferences as

luncheon

and

and
well

dinner

Oct.

13th, and field trips Oct. 14th.

and

drawn

othe^

down

areas.

McKnight Building.

are

•"'

ministration to balance the budget
this year.
And, because of, the

financing operations in the months

state of the

market, the Treasury
is
now
precluded • from further
long-term financing.
Hence the

ahead.

necessity for the Treasury to do
financing at the banks.

reaching

appears,

must

in the

spent in

situation, of course, is the dis¬
appointing inability of the Ad¬

firm.

New

concerns

"Nevertheless, these New York
banks face not only further sea¬
sonal demands from business, but

factor

name

tem¬

soon

important

included

father, the firm's Chairman, will
complete 51 years of activity in

Larson

York

Treasury
fact that

the

borrowed

sums,

York

concerns

otherwise

Continuing, Mr. Schapiro told
the
Philadelphia
analysts -that*
most

New

present

In New Location
corresponding period of the American Stock
Exchanges, have
previous year, the reduction was
MINNEAPOLIS, Minn.—Keenan
announced that John de Braganca
only $473,000,000, or 1.90%.
& Clarey, Inc. have moved their
has become associated with \ the
"The decline may be attributed
offices to new and larger quarters

being forced to compete for funds
at the banks in

the

Woodcock, Hess &

Vice-President, and William
Hess, a director. The Stock
Exchange membership is held in

formerly with Ames, Emerich

were

the

restricted

tive

>Shearson, Hammill Branch

under

had

Hess, Chairman, of the
Board; Harold P. Woodcock, Pres¬
ident; William Z. McLear, Execu¬

becoming 'more
criminatory."

Street

change the Con¬

In the

Schapiro

analysts.

who

Arleigh

ment among New York
City banks
that the existing reserve
are

which

membership to partnership firms!
only.

With

ments

voted

stitution

serve's

than seasonal.'* members

Exchange, weL
Woodcock, Hess

tion ever to gain admittance to
membership in the 161-year his¬
tory of the New York Stock Ex¬
change.
Exchange members re¬

was

the

Stock

& Co., Inc. on June 8. The Phila¬
delphia firm is the first corpora¬

Treasury

otherwise still higher interest
rate on each successive issue
of¬
fered.
In
addition, business will
be enabled to obtain its own
es¬

private
'•)

everywhere.

rowers

York

corned officials of

vital

Corp.

Funston, President of the

well

ap¬

that the prospect of the
Treasury

con¬

in the state

government

administer

sure

men

these

"The

New

;

"One effect of this flexible
pol¬
icy will be to spare the

operate
CROSSE, Wis. —Shearson,
bearing on interest Hammill & Co. have opened a
key factor to the Treas¬ branch office at 125 North Fourth

the

vinced, jusTas-f-afh

which

have

flexible.

Reserve

num¬

ment and

NYSE Member
Keith

fact is1 that the high
parent," he said, 'that the TreaS-'
& Co., Inc.
His association with
level of loans of the New York
ury must do a major portion of its
City banks has persisted against Shearson, Hammill & Co. was pre¬
financing at the commercial a
viously reported in the "Chron¬
declining deposit trend, reduc¬
banks.
icle" of May 21.
And, clearly, the Treas¬
ing their liquidity and intensi¬
ury's requirements must have top
fying the pressure on their re¬
priority in the best interests of serve
With Winslow, Douglas
position. Since Dec. 30, 1952,
the
economy."
total deposits have declined $1,A "hands off"
Winslow, Douglas & McEvoy,
policy in a free 835,000,000, or 7.25% of the $25,market on the part of the Federal
300,000,000 year end total, a de¬ 120 Broadway, New York City,

which

help dismantle the
sprawling Federal Govern¬

states and cohTTmrnttTCB.

its

Woodcock, Hess Go.

half of this
year, a period
critical because of the un¬

ury,

Schapiro

was

serve

that

make

banking

rates—a

Morris A.

state and local

nearly 25%
of the
bank capital.
Because

New York's importance as a
lending center, the conditions un¬

Treasury
bills, recog¬

the

nizes the real¬

those of the Federal Government.

hold

country's

They showed that prior to the
Depression, the expenditures • of
governments were
than three times as
great as

issues.

new

Clearing House Banks "in
New York City, with high lending

banking
sys¬
tem
through

tistics which I

Treasury's

banks

"The

the

authorities,

for

icit.

participate in, and thereby in¬

Treasury

commercial

continue

expectedly large government def¬

■

delphia, Morris A. Schapiro, bank

declared

made

"The monetary authorities are
already employing their resources

Philadelphia • on
meeting of

luncheon

Schapiro

second

major portion of its financing via commercial banks.

Speaking
June 4

because

may

must do

their

will

available

system's requirements during tne

Schapiro, New York bank analyst, says action of
Federal Reserve in supplying credit to banking system through
purchases of Treasury bills makes it apparent that Treasury

civil servants who

career

dedicated

are

the

also

serves

funds

Morris A.

be said that the inter¬

enthusiasm

large

Federal

Praises Flexible Policy of Federal Reserve

holds the key to better mu¬
nicipal government. In one sense,

zenry

charting

bright future...

participate in the Treasury's
NIT HIKINGS

CAPITALIZATION

GENERAL

III MILLIONS

TELEPHONE SYSTEM TRENDS,

1947-1952

IN MIUI0NS

Of DOUAK

"Under

these

cumstances,

compelling cir¬
the Federal Reserve
for 'middle ground.'

therefore,

that

CAPITALIZATION AND NET EARNINGS

the

001 LAIS

400

CAPITALIZATION

300

Scale at Left

200

Where
IN

THE

MIDST

MORE than 65%
our

Industry Grows

of the

revenue

from

385,000 electric and 91,000 gas cus¬

tomers is from residential and

cial customers,

which include the 48,500

electrified farms

have

commer¬

serve.

These farms

helped to make New York

of
the country's top ranking states in the
value of its dairy and poultry products.
In the midst of this progressive agri¬
culture many of the famous names of
industry have grown to prominence and
others are continually being added.
one

MODERN

NET EARNINGS

100

Scale

FARMING

the beautiful
py

the
the

countryside, promote hap¬
living conditions and contribute to
good employe relations for which
region is noted.

The

wide

variety of

products has developed
skills for

new

manufactured
a

versatility of

industry to draw from.

Proximity to the largest eastern

maiv

Our business is sound

human voice
But

power

are

further

serve,

the

17,000

square

miles we

covering about 35% of the state's

-will find no congested locali¬
metropolitan communities. An
estimated 70 % of the people live out¬
area, you

ties—no

We will be

glad to send

our

couragement to industrial growth.
own

electric and natural gas

will amount to
ten

over

carrying the sound of the

the chart above shows, the General

62 Henry

Street

doubled.

plan

management

and

keep

growing. By continuing to give

shareholders the benefits of sound financing,

sound

and opportunity for profit. By giving more

subscribers constantly improving service.

$200,000,000 for the

post-war years ending in 1955.

Annual Report for 1952

request.

GENERAL TELEPHONE
One of the Great

NEW YORK STATE

Telephone

American communities in 19 states.

Our

facilities,

Today, with 1,600,000 telephones we serve over 3000

en¬

expansion program, largely to in¬

crease

the telephone.

System is sound in other respects as well. In five years our

kets, excellent transportation, and

ample electric

over

capitalization and net earnings have more than

our

all

Right

side cities. All of which, combined with

...

ELECTRIC & GAS
Binghamton, New York

Serving America

SYSTEM

Telephone Systems

The Commercial and Financial Chronicle..

(2528)

party

Now-A Fail Bieak for Easiness

Under Our

Competitive System

Secretary of Commerce

Administration will end punitive

American

The

part

low

note

and low pro¬

living

should end.

Gives

this

the

fundamentally

strength of America.
The

motive

tem

from fair but

which is based
on
the ability of a private com¬
pany
to satisfy need or desire
by producing the most goods and

assur¬

best

cheapest

the

goods,

price.

Uniquely American
Our economic system is unique¬

role

and

en¬

properly al¬
management, it may

down the

This

has

happened

and

the

best

service

which
received

the

years

has

group

wisely and
the

system

competitive

is the most

en¬

pro¬

government

workers,
the

Yet

for

businessmen
Sinclair

Weeks

operates and

misunderstood

ment,
♦An
the

burdened
address

American

New York

can

system has
been

and

the

public

un¬

derstand exactly how that system

competitive
enterprise

industries, which are vital to all
industry and to the general

other

and

ent

Weeks
Steel

operation

improved.

Our economic

govern¬

government,

Secy.

Iron

how that

from

and

life.

But

system is differ¬

any

the

off

Institute,

one

which

government

the
a

place

for

man

had to remain

energy

bottom.

his

here

over
or

reached

Every

who

man

top could be pushed
successful

new¬

That system has been developed
to fit modern

rules

He,

the

conditions.

game

the

are

the

But

same.

Fair, tough competition still is the
motive

power

fluid

our

eco¬

nomic system.
No American has

finally

way—that
by stinting

learned—the

you

don't

is true in

want

service

dustry,

diet—in

balance sheet

the

has

slid

itor

few

years

down-hill and

with

nies that make the least
money.
Nor
do
you
when

looking farm sells the

research

and

risk

capital have constantly originated

ideas,

new

and

tools,
products.

created
with

methods
These have

new

entirely

new

sources

profit and

rundown-looking roadside

worst

seized first place.

Industrial

industries
investment

jobs.
For all practical
purposes, every

plane—inventions

which

revolu¬

tionized

the

manufacturer who

for top management...
At your

competition

can

be killed

From

years.

aggregate

value

time

until

equal to a
has the commis¬

nor

initiated

ever

rates

problem...

or on a

the functions of

can

concentrate

on a

specific, immediate

whole broad range of operations. It includes

engineers, designers, financial consultants, sales
and marketing specialists, cost
analysts—whatever specialized
skills the problem calls for.
Ebasco

men

have

dollars worth of

designed and constructed over one billion
new plants.
They have built pipelines; made

doing for the past

That

what

The

commission

itself

said

nation has

corporation
tract

continue

can

private capital

able

market

When stock
of

it must
to

yield

system
to

fair

•

unless

stock

bonds.

limits

well

our

Sherman

Jan. 20. No other

Act,

passed

Must

the

Kept Strong

In
regulating utilities and in
managing o t h e r things, it is
cheaper for the public in the long

reasonable return if the

private

ownership

that

Administration

the

intent

competition.,

important decisions; helped solve production
problems;
assisted in developing industrial relations
programs. For nearly
fifty years, Ebasco has served business and
industry in all
parts of the world.

Competitive enterprise has been
loaded down by heavy and
badly-

believes

Congress
in its approach to regulation ta
allow earnings which will make
the system of private ownership
work.
We

know

unless

and

the

know

you

To find out how Ebasco can serve
you, send for your free copy
of "The Inside Story of Outside
Help." Address: Ebasco Ser¬
vices

Incorporated, Dept. T, Two Rector Street, New York 6,

N. Y.

government

competition

increasing number

has

seen

its

rendering
service are financially strong, for¬
ward looking management cannot
put in all the cost-saving devices
improved equipment that will

and

service the

stant
for

public. The

new

expenditure of money
and improved equipment

is the way to progress, and com¬

panies

with

neither the
to

invest

small
cash

earnings

nor

heavily

the

INCORPORATED New York

Appraisal

Budget

t Construction

•

SERVICES

Business Studies

Financial

•

Chicago

•

Rates i Pricing

•

Research

•

•Traffic

•

Consulting Engineering
•

Washington Office

♦

Design

Inspection & Expediting

Office Modernization

Sales & Marketing

Taxes

Washington, D. C.

industrial Relations

Insurance, Pensions I Safety
-t,

•

future

the

regulated industries

•

Purchasing

Systems A Methods

tonight to

nation, it is

my judgment that the
regulatory bodies must a 1 lowearnings adequate to attract and
support the equity capital they

can

use effectively for
economies,
improvement and growth. If their

will

thus

able

investing

established,

obtain

public
capital.

change
There

in
is

assure

Expensive

policies can be
discarded for long-range programs
which will give the country bet¬
ter

have
and

those

that

strong,

serve

are

of getting good service out

the strong. No one
out of the weak.

The

laws

that

can

get it
has

lower

costs

is essential

the welfare

of the

country that the regulated utili¬
ties be regulated in such a manner
the

enable

them

capital that they

Western Massachusetts
201

plenty

room

and

for
one

attract
can

use

Companies

DEVONSHIRE ST., BOSTON, MASS.

it's

wholly-owned

subsidiary

WESTERN MASSACHUSETTS ELECTRIC COMPANY

where such improvement is
indicated is in the field of
regu¬
lation. When regulation
area

departs

Serving 120,000
western

customers in 55 cities and towns in

Massachusetts, with $75 million plant and

$20.1 million

and

emer¬

I say without hesitation that it

Congress

and

provision for national

gencies.

rather than

half-starved and weak. There

service

make

Administrations.

improvement, however,

the

necessary

re¬

you

they

from

any

changed with the

are

to render their full service to the

crats.

I'm here

im¬

provements.

voked by a Federal
agency. It has
been threatened with
punitive ac¬
tion again and again

that that spirit

have

courage

by bureau¬

EBASCO

con¬

wise

of fields. It

solemn contracts

that

companies

conceived taxes. It has been faced
with

years

business studies upon which bankers and
other executives have

based

within the

property values,
long run be able

the

:1 This

ago. It expresses American
faith in competition. It is our na¬
tional pledge to insure effective

at¬

it is

work."

anti-trust law such

1937: "In the long run no private

score

government

stopped doing

im¬

the return.

prove

it. That is what govern¬

courage

ment has

the

now

4%, which

consider

can

return,

sion

railway

connivance of the very
government which ought to en¬

Ebasco is flexible. It

that

one

fair

is by the

fingertips, through Ebasco, is the specialized help of
engineers, constructors and business consultants. In a
single
organization Ebasco combines top-flight talent with
experience
that penetrates
virtually every type of business and industry.

carriers

equal, or nearly
fair return upon

average has been below

borrowed

Business

ways

way

against

the

hand-to-mouth

run

one

progress.

well-fed

competition, with its opportunities
of betterment for
everybody. The

refuses

well-established tide of American

There should be no limits to
the dynamic force of fair
vigorous

tap

running

be, to

may

credit

are

the turn of the
century.

keep help

best

ing hours.
Both

earn

aggregate
property."

that the

buy better machinery in order to
reduce costs, but figures he can do
it by cutting wages and
lengthen¬

history. It is accurately
our working
population is engaged in making
or
selling things unheard of at
estimated that half of

the assumption

produce at the lowest price. That
philosophy is about on a par with

new

person over 50 years of age was
alive before the first auto or air¬

motoring
stop at the

stand

that

the

com¬

compet¬

best

motor

mousetrap has

better

ago

the

panies, the electric companies, the
chain stores, etc., so as to be sure
to buy the products of the
compa¬

through the country

top

with

around

most

the

terms

clearly to be desired.
people, if they under¬
would want it this way.
go

the

stand,
They don't

initiate, modify, establish
whole will

annual net income

in¬

income—is

firm

the

service

a divine right
summit, only his own abil¬
ity will keep him there. Many a

to the

milk

regulation. If

from

full

hard

make

the feed, and

same

And

comer.

government-controlled economy,

City, May 28, 1953.

stayed

ambition
at

in the world. It is
free and private in contrast to a

before

heap at birth. He knew his place

example, the Transportation

adjust rates
as

of these

and

years

private

shall

the

dependent
success

possible in the

Act of 1920 says: "The commission
un¬

railroads, the power and light, the
industries and those furnish¬
ing communications employ mil¬
of

cost

run.

For

gas

lions

low

long

could

industries.

they can render the best
possible to the public at

service
as

unfairly treated than

service

communications

are

that

ago.

been

and

intended to keep those in¬
dustries healthy and vigorous so

our

all

cheapest

otherwise

regulation of the
interstate power, gas

transmission

result, the public has not received
price,

for the

railroads,

and

progress

punished
consuming public.
then—iron¬ ly American and it stems from the
The way the government has
original settlers. Lacking even
ductive, the most prosperous and ically—blamed by government for
the pioneers were been regulating these service in¬
the most humane on earth and in not performing as many miracles necessities,
forced to become self-reliant to dustries reminds me of a gentle¬
as it could have, had it been free.
history. It has
survive. They were so far from man who owned a farm up in my
the
inherent
The change in Administrations
the government in London with part of the country some
years
p o w e r—f a r
changed that attitude. From here
its class strata, monopolies, and ago.
:
on out every group
beyond Alad¬
in our econ¬
He had a manager who ran the
feudal controls that
they were
din's magic
omy is going to get a fair break.
farm and gave-him regular re¬
free.
lamp —to
Already
the
Eisenhower
AdAs a result, personal liberty pro¬ ports on the operation. Now this
) ministration
create contin¬
is
stabilizing our
gressed rapidly, and there de¬ owner figured that; the I way to
ually
more
money. It
is removing controls
make money on a milk farm was
and more na¬
and other roadblocks to free en¬ veloped ah entirely different kind
of society—a fluid society. All had to watch expenses
tional
wealth
^like a hawk.
terprise. It is releasing the dy¬
limitless opportunity; to compete This he did arid
complained reg¬
namic power of competition.
which
every¬
for economic rewards. In the Old ularly about expenses and
All of us are counting on com¬
one may share.
par¬
World the caste system placed a ticularly about the feed
Yet for more
bill, the
petitive enterprise to do a record
man at the top or bottom of the
largest single item.
than 20
job. It is of vital importance that
terprise

passed

the field

development of the industries be¬
ing regulated.

livelihood

attitude toward business.

shackled by government,

located

have

hard competition,

the

traditional

croaches

of this sys¬

power

comes

ours

its

from

well slow

capitalism.

when

standard

agree¬
markets—

frequently

World

Old

and

Lauding return to free competitive enterprise system under the
Eisenhower Administration, Secy. Weeks says our economic
system is uniquely American, stemming from the original set¬
tlers, and although conditions have changed, the rules of the
game are the same.
Points out competition can be killed
"by connivance of the very government which ought to en¬
courage it," and alludes to badly conceived taxes and gov¬
ance

found

There,

price

cartels,
division

ductivity, it frequently is the re¬
sult of discouraging competition,
while here we have encouraged it,

By HON. SINCLAIR WEEKS*

ernment inroads into business which

and

ments

.Thursday, June 11, 1953

gross revenues

in 1952.

all

Number 5228... The Commercial and Financial Chronicli

Volume 177

msdring economies and improving

credit

service.

tries

can

serve

Capital in

Encourage New

of the vital service indus¬

the

last

few

in this
country is invested in regulated
industry. At a time when this
country is depending on free capi¬
talistic enterprise to defeat the
most ominous controlled economy
of recent

Other than the railroads which,

they had it, would likely spend
$1 to $$ billion additional

from

in the next five years,

I have

times, it does not make estimate of how much the service
us to control a fourth
industries would add to this $6Y4
of our economy so that it cannot
billion a year if regulation gave
compete freely for capital.
them
freedom
to
compete for
And when I discuss the matter money. The others are not like
of attracting: capital, I do not the railroads buying their equips
refer solely to the service indus¬ ment on a chattel mortgage basis
tries! Industry generally, due in and falling short of their daily
considerable
part
to tax laws needs for lack of money.
presently in vogue, leans more to
On the other hand, the courage
borrowed money than to equity and inventiveness that risks
great
capital —a comparatively recent sums for improvements and econ¬
development hardly to be wel¬ omies in the future does not nat¬
sense; for

comed.

urally

en¬

search, energetic competition, and debts. The margin on war profits
by increasing the productivity of is less than on peace profits. The
Among other im¬ our superb labor force we must same false logic that
imagines a
keep it soaring in the years ahead. nation becomes prosperous by war

(1) By

change in depreciation

The

rise

of the steel industry thinks
a
nation
becomes pros¬
expansion of agriculture perous by inflation. Both ideas are
and mining that resulted from the fallacies.

allowances, so that the shorter
years of obsolescence rather than

and

the

mately $6,288,000,000.
if

government

longer

railroad

the

Thus

heavy industry to advance

rapidly?

these

years

in¬ industries have
made capital ex¬
penditures aggregating approxi¬

money

industry

all

and

should

How
courage

provements:
the

For

One-fourth

economically

well.

Regulated Industries

vested

that in the long run they

(2529)

of wear-out shall

years

standard

depreciation.

will be

owners

encouraged

the

expansion did most to
wipe out the indebtedness of the
Civil

War.

The

rise

the

The

auto

in¬

prise

can

New

material

machinery with industry with all the new indus¬
its higher productivity and lower tries
indirectly stemming from
costs which more greatly benefit petroleum
and
motor
cars
did
much to lower the indebtedness of
the consuming public.
World War I.
(2) By so wisely and fairly
competitive
enter¬
using the regulatory powers of .American
to install modern

government that the service

whole

founded

that

system
misery

The best thing
happen to heavy in¬

and

the

families

America would be the dawn of

just and lasting
But

and

waste.

could

dustry

war

human

of
a

peace.

until

that bright morning,
continue to strengthen
economy on which is built the
military might that is saving the

do it again.

must

our

advances

in
electricity,
position to plow back earn¬ chemistry, power, atomic energy free world from the horror of
and their ramified stimulation, on attack, defeat and doom.
ings, attract capital, expand facili¬
The times present the greatest
ties and, through eventual vigor¬ old, new, and as yet undreamed,
ous
economic health, be able to of industries, can save this genera¬ challenge of history to all who

dustries and others will be
in

placed

.give the public better service at tion from unbearable indebted¬ are part of our competitive enter¬
ness and carry it to a standard of
lower costs.
"
prise system.
The V new
The new Administration is re¬ living far above current record
Administration
is

emerge
from men who
the credit to raise the

steadily giving you more
moving road-blocks to business- prosperity. : and
We do not need cold war or more freedom. Use that freedom
small and large. It is opening wide
money nor assurance that they the door of
hot war to maintain our economy to
give
yourselves
and
opportunity for all
yoiir
regulation would not either by would be allowed a return on it
high
level.
War
destroys children record prosperity and to
competitive enterprise to compete. at
delay or refusal prevent earnings when their dreams come true.
Thereafter business is on its own. property and lives. War piles up keep our country free.
sufficient to attract-capital, we
If we want this fundamental
How successfully business uses
might reasonably expect the rail¬ segment of American economy to
its new freedom depends largely
roads, for example, to greatly in¬ do its full part in the free world,
on businessmen themselves.
crease
their yearly expenditures we shall have to
They
give it a fair
have been accustomed to an era
for plant.
break. r
of easy money, subsidies, pater¬
The other regulated industries
I see in the papers from time to
are not quite so badly off, but I
time suggestions of a great emer¬ nalism, government directives and
evidence

The

there

were

clear

some

that

have

not

that

assurance

should

like to call

attention

your

report of the Committee

gency public works program to
stabilize and particularly in times

Corporate Finance of the National
Association of Railroad and Utili¬

ties

Public

Commissioners—the

associa¬

tion of the state regulatory bodies.
That report points out that 25
ago
we
had the greatest
governmental prosecution of reg¬
ulated industries ever undertaken
years

—the holding company investiga¬
tion—and the evil it found to re¬
form

that

was

business

the

had

too much debt and was controlled

by too little stock.

was

then

are

advocating what

much

condemned—too

debt and too little

And

equity.
"The financial

says:

dangers of high debt ratios, the
importance of good service to the
public, and the inevitability of
service

breakdowns

following on
the heels of financial breakdowns,
have again become matters of se¬
rious
ment

very courageous
the committee of

commissioners.

salutary effect

Government

ministration

mess

see

that

which

shall

when

and

service

the

industries,

surely put off the
to

have

works

public

emergency

day

recourse

and

And this is

especially true when

its

that this Ad¬
Un¬

less

we
also are willing to drift
Into calamity, we must assure the

They have been oper¬
allocative era. They
entering a selling era with

ating in
are

stiff

competition ahead.

ness

must

busi¬

is to enjoy a free market, it
assume the
responsibility for

making the free market work.
I
have this evening discussed
competitive industry and I have

also

discussed

the

service

great

status

industries

the

which

generally speaking are not com¬
petitive and because of that fact
subject to regulation

are

our

government. I have attempted to

point out insofar

regulation is

considering that public works cost concerned that it mustNbe so con¬
taxpayers money and the capital ducted as to allow the/industries
attracted to the utilities pays taxes affected to be strong and healthy
—and in a position to give the
instead of adding to them.
We shall always have public best possible service to the public.
works

and

many

are

necessary

Reponsibilities of Competitive

and

useful, but there is no reason
to hamper private enterprise with
a resultant limping economy and
end up by

having to start a public
to provide jobs

program

and energize

the

economy.

Government
The need

Encouragement

for fresh

encourage¬

ment of business by government

Nearly

Industry
Insofar

competitive industry
concerned, competition itself

should result in the public receiv¬

ing the best products that Ameri¬

ingenuity can devise at the
price. I would, however, in

can

Heavy Industry Requires

facts

the

inherited.

has

economy

industry

late the 25% of our free economy

state

The condition of the utilities is

part of the

national

generally
particularly work to stimu¬

and

the Fed¬

regulation recognizes
with equal clarity.
a

are

encourage

state regulation.

It is also incumbent
eral

docu¬

should have

It
on

the

of
we

works

reconsideration."

This is

naturally an
to, not the main reliance

addition

point out

commissions

the

now

agreeing

works

other artificial stimulants.

The report goes on to

that

declining business to strengthen
economy by providing jobs.

our

inflation.

lowest

view

controls,
that

the

abolition

recent

remind

all

and

sundry

management,

owners,

and

is
labor all have a responsibility to
public utilities.
the general public to Show re¬
The entire field of heavy industry
confined

not

straint and moderation and to

see

requires attention. Heavy indus¬
to it to the best of their ability
try makes the mare go. Its pros¬
that our economy stays on an even
perity stimulates prosperity
keel.
throughout the entire economic
The Administration by striving
fabric.
for

balanced

budget and even¬

tual

tax

some

of the financial burdens. But

national

reductions

will

relieve

security and public

mand for modern services

de¬

require

modern

The

SPUR

PR06RESS

the

budgets. Drastic cuts in
$264.5 billion national debt,

plus the state, county and munici¬

Texas

—

in the

Apart from everything which
good government can do to reduce
government costs, the sure way to

ranking well above national

debts and taxes relatively smaller

Arizona, New Mexico, Colorado and

form the

spur-section of

progress

maintain

United States,
average
Union

in recent population increase. Southern

is for

solvency

these

states

—

serving

than

235,000 customers in the great and growing
Southwest.

billion dollars of

area

of New

Orleans since World War II. Announced construc¬
tion plans should soon push this figure well past
the billion mark.

This record growth proves that

New Orleans has become

key industrial center

of the nation because its invitation to

locate here has been

New

invitation

industry to

opportunity.

industry enjoys

Orleans,

combination of advantages.

Here is

unique

port—sec¬

ond in the nation in dollar volume—that is host

annually to nearly 4,000 ships—ships carrying the
world's

resources

industry's door—ships

carry¬

ing industry's products to world markets. Yet, in
the immediate

finds

vicinity of this great port, industry
abundance

sources

supply,

power,

our

make
sugar cane,

the volume of business.

country

many

of the chief

re¬

.op natural gas, water
sulphur, saltffurs, timber, cotton,
.

rice.

INVESTIGATE

NEW ORLEANS

...

Every businessman knows from

provides natural gas service to 55 towns

cities

three quarters of

expanded industrial plants have been

private business to increase

experience

and

built in the immediate metropolitan

also

pal debt, are not likely soon.

Four states

new

can

that

double

the

his

company

turnover

particular operation, the resultant
ability to handle the firm's indebt¬
edness is made doubly easy.
The same principle applies to
the

Federal

Government

and

as a

prospective location for

to our

your

business. A note

Industrial Development Staff, New Orleans

Public Service Inc., 317 Baronne St.,

will place its

assistance at your disposal.

the

economic system. The sure way to
burden

govern¬

ment debt is by such

increase

decrease

SoHthern^pUhion Gas

the

production

that

debt and the cost
t{

MfiriNG

IVIID

fH|

C. H.

Zachry, President

CIIAI

JOUTHWiJT

Home Office: Dallas, Texas

the

national

of running the

government grow smaller in pro¬
portion to rise in national income.
The gross national product to¬
day is $361 billion, an increase of
$21 billion over the same period
last year. Through industrial re¬

a,
•V

SERVING NEW ORLEANS WITH

LOW-COST ELECTRICITY, NATURAL CAS

AND TRANSIT

(2530)

The Commercial and Financial Chronicle

originally planned a few
and because of the
preparation could prob¬
not have been easily de¬

.Thursday, June 11, 1953

course,

weeks

Public

Utility Securities

ably

ferred.

Utility Stocks Warranted?

Utility stocks 4iave disappointed
of their friends recently, but
the whole have not made a

% Incr.

bad
and

showing compared with rails
industrials, as follows:

Dow

W,53

June 3

Averages

High

Decline

Industrials

293.8

268.3

8.7%

Rails

112.21

103.3

7.9

53.88

49.4

8.3

Utilities

showing of the utility stocks
also be considered creditable

considering

the

amounts

common

fact

that

large

stock

have

been sold by the electric and gas
utilities this year.
Following are
he amounts in millions of dollars:
Electric

January

Gas

$76

March

Totals

$73

February..
pril
Lay

______

cash

might be
ferment

arising

105

$114

reporting
over

thus

made
far

statistics
been
over

1953.

electric

showing
the

principally
through subscription rights:

General Public

Texas Illinois Natural Gas

Rochester

com¬

(as

re¬

available

have

made

Board

has

been

time—in

sible

early

2%—and

that
not

normal

been

yet

1951

hence

Mr.

pos¬

relationship

Just

restored.

spread is, how¬
is difficult to determine, be¬
(1) common stocks were ab¬

ever,

number

dividend

have

light

He
the

power

and

with

in¬

his

entire

career.

Sammis

attended pub¬
grade and high schools in

University.

engineering

•

...

In 1920 Mr. Sammis

joined Consumers Power Company, serv¬
ing in various engineering and sales capacities. Following a short
period of association with C. H. Tenney & Company of Boston,
Mass.. on power sales, and rate analysis work of utilities in
New York and New

utility

increased

identified

the

Sammi3

at Columbia

1920 and

electric

service and spent a year as an instructor in electrical

"normal"

Insti¬

Hempstead, N.Y., and then ob¬
tained an electrical engineer¬
Harold Quinton
ing degree in 1917 at Colum¬
bia University.
Immediately following his final examinations, he
enlisted in the First World War as a machinist in the
Navy, later
becoming an ensign. After 28 months, he was released from active
Waiter

ex¬

it is

Directors

throughout

business

lic

for

narrowing

been

electric

ferred stocks. However, the spread
between
preferred and common

has

dustry

in yields on bonds and pre¬

stocks

the

Pennsylvania Power Co.

the changes of about
the
past
ten
weeks.
Average
yields on utility common stocks
have risen from around 5Vz% to
6%, compared with a rise of about
%%

is also Chairman of the

tute,

England, he returned to Consumers Power in

elected

was

Vice-President and Director of that

com¬

in 1932 and the following year was named to serve in the
same capacities for Ohio Edison
Company and Pennsylvania Power
Company. In 1936 he became President of Pennsylvania Power

pany

their

rates this year and

this,
has helped to make the
adjustment to a higher yield basis.
of course,

ensu¬

year.

Vice-President

securi¬

senior

only

companies

(Texas Eastern Production)

Most of these offerings were,

adjustment has prob¬
been effected if we con¬
an

now

sider

Western Light & Telephone

showing:

ably

E'iectric

Texas Eastern Transmission

good

obtainable

now

ties. Such

normally low during most of the
period 1935-51.

Gas & Electric

Southern Natural Gas

far

mon

normally popular in the 1920s and
(2)interest
rates
were
ab¬

Gas

San Diego Gas &

leased by the Federal Power Com¬

mission) lag somewhat, but

Star

Potomac Electric Power

Co.,

the

for

ing

cause

Bangor Hydro-Electric
Lone

Edison

Vice-President

** "

reces¬

utility prices has been the
adjusting yields on com¬
stocks to the higher yields

what

line

California

ern
%

near-term

col¬

principal

Mr. Sammis, the new Pres¬
ident, who served last year as

has

Pipe¬

Institute, at its 21st Annual Convention
City, N. J., on June 4, elected Walter H. Sammis,
Company of Akron, Ohio, as its Pres¬
ident, and Harold Quinton, Executive Vice-President, of the South¬

some

Utilities

this

The

ago.

Electric

President of the Ohio Edison

sion in

ceeded

Derby Gas & Electric

have

Monthly earnings

Electric

Public Service of Indiana

12-14%

pilations for the industry

Gas

New England Electric System

corresponding weeks of

last year.

sched¬

uled for early offering,

weekly

output

gains

the next year or so,

been made recently, or are

showing

Recent

continue

Despite the rather sharp decline
the
market
during June, a
number
of
new
offerings have

$346

excellent

part of their

will

Edison

held in Atlantic

need

of de¬

as earnings and dividends
concerned, the electric utilities

have

amortization

earnings)

increase

week

argument for

taxes

saving (which most utilities
not

are

reviewed

was

Federal

in February this year com¬
pared with $147,000 last year. This

cash

which
umn

000

So far
re

peared

figures

income

The

pessimistic forecasts re¬
utility stocks have ap¬
in recent weeks, one of

little better, since de¬

from

American

$232

the

basis

general market.

garding

7.5

9.1

_____

11.3

President of Ohio Edison Company chosen at 21st Annual
Convention at Atlantic City. Harold Quinton, of Southern Cali¬
fornia Edison Co., named Vice-President.

Several

fense facilities amounted to $550,-

The
ay

March

Percent.

01 Edison Electric Insiitnte

new

helping utility
share in any comeback

the

13.2%

8.1

stocks

Net Income

9.0%

January
February

likely that

months,

summer

Last Year

over

Total Revs.

some

It appears

offerings will soon begin to dry
up, and this pressure on the mar¬
ket may be relieved during the

By OWEN ELY

Is the Decline in Electric

Walter H.Sammis New President

ago

cost

and

two years later was made a Vice-President and
Director of
Commonwealth & Southern.
In 1944 he resigned from Common-

Thus the several companies which
in recent months raised their rates
from

$2 to $2.20 (ConsolidatedEdison, West Penn Electric, Ohio
Edison

have
•

■

Firm

':•<

•

" %

■

4 «

Consumers

PRIMARY

Power)
tare of

taken

this fashion.

Additional increases

likely from time to time

appear

«i

(a)

(b)

Natural Gas Companies

from

Transmission &

report

Producing

atomic

AEC
and

The

energy.

Chairman

about

the

commercial

the

Dean

Kentucky Utilities
Mississippi Valley Gas
Mountain

Northern

recent

Public

the

reactor,
advertisement

pers

Troster, Singer
Members N.

Co.

Gen¬

that Can Be Built Right
(for $10 million)" doubtless

investors.

some

However,

leading

experts such
as
Philip
Sporn of American Gas & Electric

Trinity Place, New York 6, N. Y.

Southwestern

still

remain

the

opinion that
atomic power is not "just around
the corner."
Moreover, a number
of

the

work

utilities

with

the

actively

are

AEC

New

Service

Mexico

Public

Service

Tennessee Gas Transmission
<

Texas Eastern Transmission

•

West

erator
Now

startled

Security Dealers Association

Atomic Power

Service

Southern Union Gas

in the Monday morning pa¬
headlining - the
statement *

"Here

Supply

Southwest Natural Gas

of North American Aviation Com¬
pany

Fuel

Indiana Public

Puget Sound Power & Light
:

breeder

full-page

Service

Missouri Power & Light 3.90 pfd.

power'
of

Public

City

Kansas-Nebraska Natural Gas

by holders who were ap¬
prehensive over the potential de¬
of

Electric

El Paso Electric

Kansas

stocks

velopment

Gas

Louisiana

Commonwealth Gas

operating savings.

In the past few days there
may
have been a little selling of utility

Operating Utilities

Central Electric
Central

individual companies realize
larger earning power through rate

increases

MARKETS

Arkansas Western Natural Gas

necessary-yield adjustment in

any

Trading Markets in-

and

substantially

Ohio

Gas

SCHERCK, RICHTER COMPANY
Teletype
SL

Landreth Building

456

St.

Louis 2,

Garfield 0225
L.

Mo.

123

experi¬
field, and the
industry will certainly not be
caught napping. The change-over

mental work in this

We recommend
with

conservative defensive
security

added feature of

spin-off of oil

properties and non-dedicated
acreage

generating

methods,

if
and
will involve only
partial abandonment of generat¬

when it

comes,

ing

MOUNTAIN FUEL SUPPLY GO.
Capital Stock

facilities—similar perhaps to

the

problpm of manufactured

gas
companies in changing to natural
gas. The gas companies have been
permitted bv regulatory and tax
authorities to amortize the cost
of

conversion

year

Ask for

our

period)

(usually

10-

seems

for ALL

WISCONSIN UTILITY ISSUES

lit¬

over

and there

Market Place

tle doubt that the electric utilities

special informative analysis

could

make

similar

adjustment

if necessary.

Certified Investment Co.

P. F. FOX & CO.
,

,•

120

BROADWAY, NEW YORK 5,

Telephone

REctor 2-7760

1-944

Boulevard.
1-945

The

Financial

Chronicle)

ANGELES, Calif.—Certi¬
fied Investment Co., Inc. is
engag¬
ing in a securities business from
offices

Teletypes
NY

(Special

LOS

3337

West

Officers

Olympic

are

Harry M.

Roman, President; M. J. Cambianica,
R.

Secretary-Treasurer;
Waltreus, director.

and

INVESTMENT

SECURITIES
*

225

MASON

ST.

TELETYPE

&
MILWAUKEE

Milwaukee Phone: BRdwy. 6-8040

483

Chicago Phone: STate 2-0933

Volume 177

Number 5228

The Commercial and Financial Chronicle

...

wealth and also from Consumers to
accept the

Edison, at AKron.
in lbou, he became
Pennsylvania Power Company. »

(2531)

Presidency of Ohio

cnairman

of tne Board of

Lewis (Hank) Serlen

Newspapers

Celebrates

The New Vice-President

By ROGER W. BABSON

Harold Quinton, the newly elected Vice-President of the Edi¬
son Electric
Institute, has been an officer of Southern California
Edison since 1942 when he was elected Vice-President
in

Mr. Babson describes the World's Greatest
Revolving Globe
at Babson Park,
Mass., which he has dedicated "to the news¬

papers

Finance.

named

was

Director

Executive Vice-President in

1948, and

the

Charge
in 1945,

company

Committee of the Board of Directors in 1949.
He is also,a Director
and Vice-President of the Los
Angeles Chamber of Commerce and
a Director of the California
Bank, Pacific Mutual Life Insurance

Co.,

Pacific

Coast

Electrical

Association,

and

Edison

The future
of

Electric

the

Says

of the

world

Free

depends

Nations

four

upon

he served

for six years
Co.

Edison

before

Colleges;

and

with the Treasury Department in Wash¬
years as a partner in the firm of Arthur'

ington, D. C., and for 16
Andersen

(2) Our Churches,; (3) Our Schools
and

(4)

17th.

predated,
tected

their

freedom

their

and

becoming associated with Southern Cali-'

for

day

Co.

t for all

p o r

Chicago Bond Traders
To Hold Annual

Milwaukee Bond Club
Annual Field

Ouling

ewspapers

Globe

was

CHICAGO, 111. — The Bond
Traders Club of Chicago will hold
their 27th Annual Field Day, Sat¬

MILWAUKEE, Wis.—The Bond

tnenabsons

Club of Milwaukee will hold their

have distrib-

urday,

Oconomowoc Lake Club and Oco-

Hills

June

27,

Country

the

Club,

Nordic

Itasca,

Illi¬

nois.

annual field day and

uted their

picnic at the

Tariff

neys
are
in charge of William
Landerson, Lee Higginson Corpo¬

ration, and Paul Bax, First Boston
Corporation. Prizes for members
will

1st

and

first 3 low net

2nd

low

(Peoria) and

gross;
a spe¬

cial short hole prize.
For
guests,
prizes

will

awarded

and

low

net

for

low

gross

(Peoria).

Baseball is in charge of Charles
Scheuer, Dempsey-Tegeler & Co.,
and will start at 2:30 p.m.
Clubhouse in charge of

Madary,

Geyer

formation
Gilbert

Golf matches will be under the

with

should

Free lunch will be served from

Pollock, Swift, Henke

(Special

The

Leighton
J.

Lee

Financial

has

Chronicle)

Joins Arthur Fels
to

KANSAS

are

bankers, the manufacturers,
shopkeepers. Newspapers
only have the opportunity of

The

Financial

CITY,

not

Chronicle)

Mo.

—

•

David

Co.
d i

i
n

Serlen

Street

Mr. Serlen is

years,

director

the Security Traders

(Special to

the

staff

Company,

Inc.,

Trust Building.

The

Financial

^determine

associated with

now

the firm

rooter,

its sales department.

Peabody & Co., and Mr. Sullivan
was formerly in
the municipal
bond department of White, Weld
& Co.

(Special

NEW

to The

Financial

now

Fahnestork

*aftnestock
Street. He

LAUDERDALE

Mildred

Johnston'

the staff of Roman &

Fifth

Johnston

was

Fla.
has

ioine

Johnson, 23

Avenue.

Mr;

previously

wit

A. M. Kidder & Co.

9n=

Edw. A. Viner Adds

Philip

—

with

connected

Chronicle)

HAVEN, Conn.

Susman

to The Financial

Southeast

Joins Fahnestock

Eisele

With Roman & Johnson

Mr. Armstrong was formerly in
the sales department of Kidder,

(Special

The

Financial

Chronicle)

rhnrrh

BANGOR, Maine — Thomas
Co, ZU5 Church
previously with Leeds has joined the staff of Ed

King, Libaire,

Stout

& ward

£0

Viner

Co,

Stat

Street

what

the

Street.

who

logs into pulp,

their

and

writers and
all

the

turn

make the paper and

publishers

P0MER0Y, INC.

UNDERWRITERS AND DISTRIBUTORS
OF

Distributors

PUBLIC UTILITY, RAILROAD

who cut the trees; the mill work¬
ers

—

Dealers

Chronicle)

and

SCH0ELLK0PF, HUTT0N

Underwriters

say.

When I mention newspapers I
CLEVELAND, Ohio—Jefferson
include everyone connected with
H. Ware has joined the staff of
McGhee & Company, 2587 East them, including the woodsmen
55th

—

largely

INDUSTRIAL and MUNICIPAL

ink; the

SECURITIES

reporters,

printers; and, in fact,

employees, including the boys

and

girls who deliver the papers.

Yes. and I must not forget the ad¬

—

vertisers,

INVESTMENT SECURITIES
Private Wire between

without

whole" industrial

collapse.
our

whom

To all these I

our

W. C. Langley

might

system
am

dedi¬

Members New

offices

& Co.

York Stock Exchange

cating this—"The World's Largest
63

WALL STREET, NEW YORK 5

70 NIAGARA

BOwling Green 9-2070
Teletype:

STREET, BUFFALO 2

115

Globe."

New York 6, N. Y.

Broadway

WAshington S06G

1-2827

Teletype: BU

This "Great Revolving

being

located

the

300-acre

Wellesley, Massachusetts.
feet

BArclay 7-8800

Globe" is

of the Babson Institute at

campus

Primary Markets

Tel.

The Great Globe Described

122

It is 30

in diameter and weighs with

the

shafts

and

cities

countries

The

tons.

are

located

U. S. Governments

Municipals

Public Utilities

scale

Utility Stocks
"Utility Stock Analyzer" containing

complete data
is

now

the

inch,

and the

75 Public Utilities

the

Italy,

available upon request.

95%

United

America,

other

Industrials

Railroads

Equipment Trusts

designate the home of

the newspapers of 400 cities from
which

Our

miles

Globe will

the

States,

Great

West
Free

population

Preferred Stocks

Canadians

Canada, Latin

Britain,

Nations

are

Bank

France,
and

Germany,

Acceptances

the

reading.

Copies of these and others, includ¬

ing the "Commercial and Finan¬
cial

GEYER & CO.
INCORPORATED

BOSTON
LOS

ANGELES

wires

CHICAGO

PHILADELPHIA

bolted

are

being depos¬

concrete vault

cornerstone,

63 WALL STREET, NEW YORK 5, N. Y.
Private

Chronicle,"

ited in

upon

bronze

under the

Salomon Bros. & Hutzler
Members New York Stork

which will be

plaque

with the

Sixty Wall Street,

following inscription:

to:

"This plaque

Exchange

New York 5, N. Y.

Privett wins H

is dedicated to the

BOSTON

-CHICAGO

PHILADELPHIA

CLEVELAND
SAN

FRANCISCO

ST.

LOUIS

Newspaper
Globe

and

employ.

Publishers
all

persons

the
their

May their work be ap-

New York, and a Thursda
night regular with the STAN
changes, announces that William bowling league. He also plays gol
b. Armstrong and A. A. Sullivan and Softball and
is a Dodger;

guiding their nation's leaders, but
they are a great factor in electing

preachers and teachers

Associatio

the right leaders. The advertising
now with Arthur Fels
columns of these papers determine
Mortgage Co., 1004 Grand
the employment conditions of the
Avenue.
country; while the editorial writ¬

With McGhee & Co.

than

Kramer is

Henry

—

joined

Peeler

the

ers

With J. Lee Peeler
DURHAM,

to the future of America than

r a

Joseph

Bond &

.y?-..

■

made

through the
great Open-Church
Movement; speeding college education, through Babson Institute,
Webber College and Utopia College,
and
now
dedicating
this
World's Greatest Revolving Globe

and the

Incor¬

George

11:30 to 1:30 p.m.

(Special

John

Co.

York City, members of the
New York and Boston Stock Ex-

Struck, The
Milwaukee Company, and William
to
the newspapers
of the Free
Bosse, Loewi & Co.; cards, F. A. World. I feel that
newspaper pub¬
Newton, Loewi & Co.; baseball, lishers
have not been appreciated
Lyle Hamann, Central Republic
when
they are entitled to far
Company and Tom Twitchell, B.
greater respect and consideration.
C. Ziegler & Co. 1
They certainly are more important

porated.
Reservations

obtained from

Vonier, Paine, Webber,
Curtis, General Chair¬

direction

New

are

awakening

the churches,

man.

Harold

Co.

may

Estabrook & Co., 40 Wall
Street,

for

Roger W. Babson

Jackson &

for

In
H.

Lewis

Join Estabrook Go.

plus savings

Country Club June 19.
guests $10; further in¬

nomowoc

Guest fee, $15.00.
Events of the day will begin at
8 a.m. for golfers. ; The
golf tour¬

sur-

department.

aoove,

•

thai

Memo-

twentieth y ei

with
the t

Dedication

c e

brated

Armstrong, Sullivan

World. In view

Bay

17, 190;

June

also

rial Day.

Free

her

greater supn

bee

June

ROGER W. BABSON."
The

York<

born

N ewspapers.

My aopeal to-

nath

having

into One United World.

Our

t h

New
pro¬

responsfOnly they can
this

e n "

rarity

great

bilities be realized.
bring the nations of

Mr. Sei

are

foundation stones: (1) We
Parents;

!A native of Topeka, Kan., Mr. Quinton attended
Topeka High
School, Washburn Academy, and Northwestern University. Fol¬
lowing three years in the United States Army during World War I,

(Hank) Serlen, Josepl
thai &
Co., New York City,
celebrating his birthday on Jur

newspaper publishers have
entitled to far greater respect
and consideration than they have received.

Institute.

fornia

of the Free World."

been appreciated and

not

member of the Executive

June!

Lewis

CLEVELAND

HARTFORD

SAN

FRANCISCO

The Commercial and Financial Chronic le...

(2532) II

Continued jrom page

Restrictive Credit Policy
And the Banking Outlook
While

has been
increasing
the capital
measured
in reasonable relation
structures of many banks through¬
to its risk assets, in which cate¬
out
the
country,
the
over-all
gory loans and securities are in¬
cluded. More and more it is rec¬ trend in building adequate capital

should

requirements

capital

made

some

progress

thin

and

substantial

in¬

been

has

structures

too

ognized that the net worth, or
capital structure, is the true basis spotted. As I view the situation,
of a bank's size, and indicates its accomplishments to date are quite
intrinsic strength. As bankers, we modest and inadequate, as con¬
quite generally apply that rule in
our own analysis of credit worthi¬
ness of our customers.
The Gov¬

taxation

favorable to

applied

building stronger fi¬

nancial institutions.

A more con¬

siderate view of the amount of re¬

tained
taxes

earnings
is

our

structures of
banks that should take place.

our

is essential

The

increase

order

banks might be able to

Government and

our

ple.

Banking

must

its

Since

have

well

shareholders

and

interests,
has

ness

borrowed

in
too
many
instances
when provision should have been
made for all or part of its re¬
money

available

tance of business

ize

favorable terms.

instances

numerous

business

sound

equity shares

the

equity markets has been
influenced by the policies of our
National

Tax,

and

has

re¬

cently been local manager
Shearson, Hammill & Co.

Hooker &

for

Fay Branch

direction of Edwin E. Hendrickson
and James T. Love.

New

Sparks Office

ASBURY PARK, N. J.

Sparks

Co.

have

office

branch

which Wanamassa

etc.,

J. W.

—

opened
1400

Drive,

T. J.

South

with

Moynahan

Arthur

Warner

to "result in some ad¬ Offerman
as
representative
in
vantage to borrowed capital as
charge.
contrasted with equity capital. In
testifying before the House Ways
With Wins low, Douglas
& Means Committee just this past
Monday, Secretary of the Treas¬
Winslow, Douglas &

has

been

appeared

Humphrey

referred

voiced

also

ferring

If it is that

to
in

agreement

the

"bad" tax.

re¬

"vicious"

tax.

bad, and I think it is,

should

not

expiration

with

interfere

June

30.

tain

itself

the

relationship

new

New

Inc.

Co., Inc.,

York

succeeded

Securities,

Officers

corporation

City,

Eastern
of

the

Theodore J.

are:

Moynahan, President; Robert Laf-

McEvoy,

120

Broadway,

members

American
nounce

New

the

fan
and
Alexander
W.
Moore,
City, Vice-Presidents; and William Es-

York

New

York

and

ser,

Exchanges,

Stock

an¬

Moynahan

that Herbert W. Klotz and

Thomas Throm have become

Secretary

Treasurer.

formerly

was

Mr.

Vice-

President of J. Arthur Warner &

its

Business

would be much better off to main¬

Utility securities.

past
investment

own

Houston

Broadway,

Public

120

underwriting and distribution of sound

his

Henry

ury

have specialized in the

French in the

Mr.

business

to util¬

concerns

the

Profits

business.

reluc¬

the

flected

referred

Succeeds Warner Ce.

HOUSTON, Tex.—R. D. French
offices in the Esperson
Building to engage in a securities
has opened

quirements in the equity markets.
SAN MATEO, Calif.—Hooker &
a fairly satisfactory
Fay have opened a branch office
equity market over a long period
at 205 Fourth Avenue, under the
of
time,
and money has been

Excess

our

Eastern Securities

We have had

Excess Profits Tax

For many years we

Busi¬

owners.

resorted

R. D. French Opens
Own Office in Houston

those of its conducted

peo¬

our

important place in

sition

own

strong and sound po¬
is necessary to protect its

equity in

strength¬

economy.

country.

it also has not maintained its

Government, and is re¬
in the provisions of the

ened, preserved and enhanced in
the years ahead so as to faithfully

after fulfill

banks

desirable, and is also in

the best interest of

in the capital

crease

fully
v/hereby
banks is discharge their responsibilities to

atmosphere

the

that

ernment has been too slow in cre¬

ating

with

trasted

inadequacy of equity capital in
banking, this might be an appro¬
priate
occasion
to
suggest
to
American business generally that

Thursday, June 11, 1953

asso¬

Co., Inc.

ciated with the firm.

Mr. Laffan

Presi¬

was

dent of S & L Reports Inc.

sound

position in
its own net

worth

to
its over-all operations
commitments, regardless of
profits that might accrue through
consideration
of
temporary tax
and

BOENNING & CO.

benefits.

Conditions

vail under which

Philadelphia 3, Pa.

business

could

pre¬

heavy term debt

would

seriously

Blyth & Co., Inc.

en¬

danger its fundamental credit po¬

sition, its
JSC

solvency,

very

safe

position

well

its

share¬

holders.
Business

SIGN OF ACCEPTANCE

Business

More than half of the
..

and

...

have used

major utility holding companies

than one-third of the electric

companies having
our

revenues

excess

operating

$45,000,000

services to assist in the solicitation

examine

ture, with
its

proxies for meetings of their stockholders.

The

management

phone companies
stockholder

of these and
find

response.

many

services

our

other electric,

insure

This is attested

prompt

gas

and

Improve

Its

Structure.

generally

its fown

should

financial

re¬

struc¬

view of maintaining
in
a
proper
and

statement

strong

relationship to its total
of business,
its general

volume

exposure

Should

Financial

...

market

and tele¬

by unsolicited letters of

commendation and repeat employments.

particular emphasis on ade¬
quate net worth, to safely and
conservatively meet its responsi¬
bilities
tions

through

our

changing condi¬
that result

economy

in good and bad times.

banking

system

Primary Markets

Coast to coast retail

distributing facilities

Public

fluctuations,

with

gratifying

Distribution

through 23 offices
located in

Utility

Bonds

Preferred Stocks

principal

financial and business

Common Stocks

A stronger

and

stronger

centers.

Complete Trading Facilities

American business will stand this

country in good stead to meet the

DUDLEY

KING

great

opportunities and responsi¬
bilities envisioned in the future.
On the

Proxy Soliciting Organization
of

70 Pine

Street, New York 5, N. Y.

National coverage through offices
in 30

representatives

principal cities

hope

whole, there is
and

ernment.

feeling
by Gov¬
a

confidence

business

and

banks

the steady progress of our nation.
Ours is a country of growth. New
frontiers
merce

industry

and

Louisville

•

San

Francisco

Springfield
•

Detroit

Sacramento

•

Minneapolis

•

Fresno

the

sound

make

that

sibilities
of

Bonds

healthy

credit

nation

•

San

•

Eureka

Diego

pro¬

wholesome

making

the

We have

growth

study

Our country has been

one.

prepared

influ¬

Electric Utilities
giving extensive data

move steadily forward.
banking structure is vital
to all people. The
challenge and

88 companies.

A strong

Copies

opportunity to American banking

Common Stocks

make

sound,
manner

that

its

contribution

constructive
to

nation.

our

the

and

steady

Corporation

Broadway, New York
BUFFALO

PHILADELPHIA

SYRACUSE

orderly

growth

Carl M.

Loeb, Rhoades

Underwriters and Distributors

Investment
William A. Schroeder
away

Schroeder

A.
a

Schroeder

heart

had

with Thomson &
•York

Request

I have full confidence

American

William
CLEVELAND

banking will dis¬
charge
that
responsibility with
great credit to itself, and to our
country.

Oakland

•

Pasadena

•

Portland

•

Indianapolis

•

necessary

encouraged by the
changed political atmosphere; and
along the line there is evidence of
hope and faith in our ability as a

and

BOSTON

Spokane

•

San Jose

Seattle

•

Cleveland

growth possible.

bankers, the exercise

caution

ence

Preferreds

HARTFORD

•

com¬

unmistakably

•

Los Angeles

•

Pittsburgh

•

In meeting our essential
respon¬

Utility

Union Securities

Chicago

•

Philadelphia

constantly being de¬
and a dynamic banking

veloped
vide

New York

Boston

are

system must stand ready to

Public

attack.

been

•

—

NEW YORK 5, N. Y.

Telephone: Whitehall 3-4000—Teletype: NY 1-630 & 1-718

Mr.
MEMBERS

associated

McKinnon, New

.Gity,. since 1919.

Co.

Securities

42 WALL STREET

passed

AND

OTHER

THE

LEADING

NEW

STOCK

YORK
AND

STOCK

EXCHANGE

COMMODITY

EXCHANGES

Volume 177

Number 5228

...

(2533)

The Commercial and Financial Chronicle

Bond Club of New York

Ernest W.

Borkland, Jr., Tucker, Anthony & Co.; Middleton Rose, Laird, Bissell <£ Meeds; Calvin M.
Robert G. Dillon, Dean Witter & Co.; Ira B. MacCulley, Equitable Securities
Corporation; George E. Clark, Adams Express Co.

Cross, Hallgarten & Co.;

David

McElroy, J.

P. Morgan

Co. Incorporated;

Walter F. Blaine, Goldman, Sachs & Co.; Frank
Dominick & Dominick; Duncan R. Linsley,
Bullock, Calvin Bullock

Kernan, White, Weld & Co.; Ranald H. MacDonald,
First Boston Corporation; Hugh

itnmp

Gerald

Moore McCormack Lines;
Kuhn, Loeb & Co.

E. Donovan,

Richard

George W. Bovenizer,

Merrill Lynch, Pierce, Fenner &
Loftus, R. S. Dickson & Co., Inc.;

Woods,

Edgar J.

Bill Long,

Doremus & Co.; Lee

Beane; Wright Duryea, Glore, Forgan & Co.;
Joseph Iglehart, W. E. Hutton & Co.

Limbert, Blyth & Co., Inc.

Scott

Gene

Ralph S. Allen, Laird, Bissell & Meeds; James
P. Smith, Merrill Lynch, Pierce, Fenner &

W. Maitland, Hudson Fund Distributors, Inc.; Norman
Beane; Lcuis H. Ingraham, L. H. Ingraham & Lo.

Dean Witter,

Jr., Dean Witter & Co.;
Dean

Russell, Glore, Forgan & Co.; Eddie Glassmeyer,
Morgan Stanley £ Co.; James J. Lee,

McMahon,

Witter

ustin

Brown,

Co.

Blyth & Co., Inc.; Hudson M. Lemkau,
W. E. Hutton & Co.

Heller, Bruce & Co.; G. Norman Scott, Estabrook & Co.; Bob Erickson, Stone
A1 Stalker, Kidder, Peabody & Co.; Albert F. Donohue, Kidder, Peabody & Co.

Webster Securities Corp.;

(2534)

The Commercial and Financial Chronicle

.Thursday, June 11, 1953

Twenty-Ninth Annual Field Day

Rudolf

Smutny, Salomon Bros. & Hutzler; Frederic
Dillon, Read & Co., Inc.

Fred

H. Brandi,

Hal

Murphy

and

Edwin

Barton, Eastman, Dillon. & Co.; Wm. H. Morton, W. H. Morton & Co., Incorporated;
E. Clark, Calvin Bullock; William L.
Canady, W. L. Canady & Co., Inc.

Buck

Robert

Frank

Stroud

Sundstrom, Schenley Industries, Inc.; Robert E. Nowlan,
Company, Incorporated, Philadelphia; Dudley F. King

Beck,

Edward

The Commercial and Financial Chronicle

Gammack

Robinson, Schwabacher & Co.; Hubert F. Atwater,
Co.; Col. Oliver J. Troster, Troster, Singer & Co.

Remmel, White, Weld & Co.; Philip Carow, Harriman Ripley & Co., Incorporated; Jim Robertson,
Goldman, Sachs & Co.; Bob Whitbeck, First Boston Corporation

H. Albert Ascher, Wm. E. Pollock & Co.,

Inc.; and

Gilbert

Whemann,

Jimmy Lanin Musicians

White, Weld & Co., and Marvin Levy, Lehman
Brothers, winners of the doubles match
S

Sherburne, Bacon, Whipple

& Co.; Frederick H.
Steiwer, Alex. Brown & Sons; W. Harman
Brown, Investors Dtversthed Services, Inc.;
Henry P. Cole, L. A. Mathey & Co.
Seated, front row:
Lgerton B. Vinson, DeHaven & Townsend, Crouter &
Bodine; Robert A. Powers, Smith, Barney & Co*;
Clarence W. Bartow, Drexel & Co.

Elmer

Dieckman,

Glore, Forgan

Co.;

Charles

Morse,

Hemphill,

Noyes

Co.;

Harry

Clifford,

Kidder, Peabody & Co.; T. Jerrold Bryce, Clark, Dodge & Co.; Alfred J.
Ross, Dick & Merle-Smith

(2535)

Number 5228... The Commercial and Financial Chronicle

Volume 177

Friday, June 5, 1953

John C. Curran,

Paul

Conley,

Blyth

& Co., Inc.; Stanley Russell, Jr., Blyth

Inc., Philadelphia; Norman De

& Co.,

Planque, W. E. Hutton & Co.

Louis

Ingraham,

E. W. Clark & Co., New York; Edwin F. Peet,
Inc.; Eugene Treuhold, L. F. Rothschild &

Bros. & Denton,

Burns
Co.

H. Ingraham

& Co.; John S. French,

A.C.Allyn & Company, Inc.; Paul F. Hay, W.

Joseph Nye, Neergaard, Miller & Co.; Robert L. Hatcher, Jr., Chase National Bank of the City
York; Edward S. Johnston, Wood, Gundy & Co., Inc.; George K. Coggeshall,
Schoellkopf, Hutton, & Pomeroy, Inc.

F. A. Krayer,

Republic Company; Richard C. Noel, Van Alstyne,
Dillon, Read & Co. Inc.; John E. Arrowsmith, Van Alstyne,

Kenneth A. Kerr, Central

W. C. Langley & Co.; John Power, Eastman, Dillon & Co.; John P. C. Moran;
Otto De Neufville, Swiss American Corporation

Hubert

Clarke,

of New

General
I

Manager of

Gustave
C.

Sleepy

Scarborough, N. Y.

C. Langley & Co.

William

Noel & Co.; Joseph Ludin,
Noel & Co.

Pevear, Irving Trust Company; Aubrey
Aubrey G. Lanston & Co., Inc.

Lanston,

Granbery, Marache & Co.; H. Stanley Krusen, Shearson, Hammill & Co.; Allen
Wertheim & Co.; Earl K. Bassett, W. E. Hutton & Co.; Raymond D. Stitzer,
Equitable Securities Corporation

A. Alexisson,
Du

Bois,

Hollow Country Club,

Hugh Bullock, Calvin

Bullock; Henry P. Cole, L.

A. Mathey & Co.

(2536)

The Commercial and Financial Chronicle

William

Earl

Jr., Henry Herrmann & Co.; Harvey Mole, U. S. Steel
Co.; Harold
Spencer Trask & Co.; B. Winthrop Pizzini, B. W. Pizzini <fe
Co., Inc.

Carl

Salim L. Lewis,
Walter C.

Bear

Hutton & Co.; Frank
Loeb, Rhoades & Co.

..Thursday, June 11, 1953

Sleepy Hollow Country Club

Cahn,

Bassett,

Gernon,

Gordon

Braman

Cook,

Bank of

Dominion

Stearns & Co.; Arthur D.
Lane, Chase National Bank of the
City
& Co., Inc.; C. Russel
Lea, Reynolds &

Veigel, Halsey, Stuart

Ball,

Adams, Adams & Peck; Van Dyck MacBride, MacBride, Miller &
Co., Newark,
Douglas G. Wagner, Charles A. Kahl & Co.; Edward R.
Greeff, Adams & Peck

Montreal;

Securities

of New York;
Co.; Arthur D. Lane, Jr., guest

George P.
Corporation

Rutherford,

Jansen

Hunt,

J.;

White, Weld & Co.; Gerald B. West, Stone &
Securities Corporation

Webster

Jarvis, McLeod, Young, Weir, Inc.; Charles F.
Hazelwood, Paul H. Davis & Co.; Augustus
Phelps, Phelps, Fenn & Co.; John Howard Carlson,
Halsey, Stuart & Co., Inc.

John

S. Linen, Chase National Bank
of
the City of New
York;
Bradley Green, Guaranty Trust Company of New
York; Fred Stone,
Marine Trust
Company of Western New York

Brittin

Trask

Eustis, Spencer Trash & Co.; Charles F.
Bryan, Spencer
Co.; Thomas S. Evans, Lee Higginson
Corporation;
O'Connell, Homer O'Connell & Co., Inc.

Homer

John

Bank &

Roll, J. B. Roll & Co., Inc.; William G.
Laemmel, Chemical
Company; Malon S. Andrus, J. G. White & Company,

Trust

Incorporated

Volume 177

Number 5228... The Commercial and Financial Chronicle

(2537)

Enlarged photo shows the transistor before
and after being encased in its plastic
shell. Inset, Transistor actual size.

ransistor,

mighty mite of electronics
Increasingly you hear of a
device

tronic

new

elec¬

the transistor.

—

Be¬

of growing interest,

RCA — a
pioneer in transistor development
for practical use in electronics — an¬
cause

basic questions:

swers some

Q: What is

particle
germanium imbedded in
a

plastic shell about the size of

corn.

same

way

But transistors

are

with tubes in the

and

not

vacuum.

interchangeable

sense

be removed from
set

kernel

that the electron

tube handles electrons in

circuits

It controls electrons in solids in

much the

that

radio

tube

can

television

transistor substituted. New

well

as new

components are

needed.

metal, is

one

They have

quire

They

no warm-up,
are

heated filament,
and use little

re¬

power.

rugged, shock-resistant and

by dampness. They have

plifiers, phonographs, radio receivers
(AM, FM, and automobile), tiny trans¬
mitters,

electronic computers and

relatively expensive
ores.

of its

physical characteristics, the tran¬

sistors

qualify for

in lightweight,

use

portable instruments.

opportunities for the miniaturization,

simplification, and refinement of

many

RCA scientists,

types of electronic equipment.

Q: What is the present status of tran¬
sistors?

A: Four kinds of RCA transistors

being produced for commercial
number of other types are in

stages

are

use.

various

of development.

Q: How widely will the transistor be
used in the

future?

of future

ap¬

neers,

research

transistor to

does

detect, amplify and oscil¬

and engi¬

facilities, have intensified their work in
the field of transistors. The multiplicity
applications in both military
fields is being studied.
Already the transistor gives evidence
that it will greatly extend the base of
the electronics art into many new fields
of science, commerce and industry.
of

new

and commercial

Such pioneering assures

from

product

finer perform¬
service trade-

ance

strated

marked RCA and RCA Victor.

experimental transistorized

am¬

any

Radio Corporation of America

electrical characteristics which enable

late

men

aided by increased laboratory

When

painstakingly prepared, it has unusual

electron tube.

number of television circuits. Because

plications, RCA scientists have demon¬

of the basic elements

found in coal and certain

A: To indicate the range

Q: What is germanium?
A: Germanium, a

the advantages of tran¬

are

long life. These qualities offer great

A: The transistor consists of
of the metal

What

sistors in electronic instruments?

unaffected

transistor?

World leader in

radio—first in television

U
'v;-

10
-m:-

The Commercial and Financial Chronicle..

(2538)

and
thermal
which was imposed volun¬ between hydro
at first and later by our generation.
government as a wartime neces¬
In addition the water power re¬
sity, industry has been somewhat source? of many European na¬
slow in comprehending the full tions are
rapidly becoming fully
significance of that discovery.
developed.
Information
assem¬
bled by the Power Section of the
This perhaps is understandable

.Thursday, June 11, 1953

from first

secrecy

page

Atomic Power and the

Electric Industry

erations

tarily

Continued

atomic energy in the United States

Al¬

States.

United

the

here

though we use tremendous and
our
industry and in our civilian Atomic Energy Act are now being ever-increasing quantities of en¬
lives," and it provided research prepared for presentation to the ergy, we have available abundant
facilities and carried on research Congressional Joint Committee on
resources
of fuels and, in some
toward that end.
Atomic Energy.
areas, water-power potentialities.
Gordon

Dean

chairman

became

Commission

the

July, 1950
and under his most capable guid¬
ance
extremely rapid
advances
have been made toward the goal
of peacetime industrial and civil¬
ian
utilization.
Today, radioiso¬
topes are being used quite widely
in many fields of endeavor—agri¬

Our

in Our Development of

Atomic

medicine,
metallurgy— in the wise guidance of the Atomic
and we are approaching the point Energy Commission under leaders
where the use of atomic fuels for such as Gordon Dean, who so well
the generation of electric power recognize the American Way of
may be possible on a competitive Life and the need to perceive and
commercial basis.
continue that way, even with such
Of greater importance, however, a controversial matter as Atomic
has been the realization by the Energy.
Articles indicating that nuclear
Commission, and particularly by
Chairman
Dean, that if atomic fission had opened up a vast new
energy is to take its proper place source of heat energy, appeared
in our industrial and civilian lives, in the technical journals as early
then
competitive industry must as 1938. These articles were based
enter into the development and on experiments carried on over a
bring its vast capabilities into the long period of time by scientists
effort. This position has been re¬ in both Europe and the United
peatedly announced by the Com¬ States.
mission and we are given to un¬
Because of the extremely com¬
derstand
that
recommendations plicated processes involved in re¬
for proposed amendments to the leasing that heat energy, and the

the

which can be made
by nuclear fission was
demonstrated by the first atomic
bombs, the peoples of the world
were stunned.
Subsequent public¬
ity led a great many to believe
that we could expect a vast in¬
crease in the availability of energy
in all forms,
and fantastic new
uses for energy were predicted.
At the present time, eight years
energy

available

after

the

atomic

The nature of the

fuel.

Atomic fuels present a vast new
tion

heat

source

energy.
Informa¬
studies
sponsored by

from

the

Atomic

Energy

Commission

iplftsi

m /-v *
|gj jjig gggj
1|
%

„

% '

p#
I

S'v/

purposes

are

exceedingly

heat energy in conventional fuels.
The

nominal

cost

pound

one

of uranium, which potentially has
the heat equivalent of approxi¬

that

tons

covered

uranium

thorium

can

re¬

economically.

dustrial processes and for the gen¬
eration of electric power, using

rea¬

actor at Oak Ridge, but full-sized
heat energy avail¬
reactors for the generation of elec¬
economically recover¬
tric power on a commercial basis
heat available in atomic fuels now able nuclear fuels is approximately
have
not
been
completely
de¬
23 times as great as that available
appears to be the generation of
in the estimated fossil fuel de¬ signed or built.
steam, which could then be used
(3) A t o m i c-powered engines
posits of the world.

conditions

sonably well understood.
practical

one

the

use

for the generation of elec¬

' '

the

able in the

for two submarines have been de¬

Present Status of Atomic

signed

Fuels

(5)

civilian

activ¬

velopments
have

been

the

United

carried

mal

type of electric

tion
as

will be

used

time goes

power genera¬

This

on.

and

continuation
crecy

has

been

the

policy of

deemed

increase

stations the

funds in recent

the portion of electric

years,

generated

ergy

hydro

en¬

the

three

decades

from

37%

efforts

have

Although

the

under

jectives

liminary

in which the ob¬

way

to complete the pre¬

are

design

reactors

and

their necesasry appurtenances in¬

se¬

tended for the commercial genera¬
tion of electric power.

(7)
need

There
to

carry

forward.
what

future

great

this

and

knows

one

urgent

development
exactly

developments

may

bring, but the accomplishment of
practical industrial applications
very probably will have impor¬

countries

directed

primary

power

(6) Several studies and projects
are

essential

been

electric

appear

cially.

tant

largely to peacetime civilian and
industrial applications.

United States has decreased in the

past

practical, and
that substantial development

Atomic

In most of these

large

with public

use

necessary before such power
could
be
competitive
commer¬

energy
developments
nearly all of the more economical also have been carried on
by other
hydro-electric sites have been de¬
friendly nations, including at least
veloped.
Those
remaining
are
Canada, Great Britain,
France,
mostly in remote areas and there¬
Norway, Sweden, Switzerland.
fore
have
a
limited
economic
Belgium, The
Netherlands
and
value. In spite of the tremendous
Brazil.
built

the

fission for

generation

(b)

has been continued.

and

is because

that

monopoly under the
Energy Commission, in ac¬
cordance with the provisions of
From the standpoint of electric
the Atomic Energy Act of 1946.
power we should clearly realize For
national security reasons the
that in the United States the ther¬

feasibility
(a)

reported

the heat of nuclear

Atomic

Resources

AEC, have
studies and all

does

government

Thermal Generation and Fuel

teams,

with

the

States

forward

industrial

contracts

have
of

responsibility, and to forward under the cloak of great
clarify the steps which must be secrecy until the Hiroshima bomb
taken before heat
from
atomic
explosion in April 1945. Since
fuels can become a major factor
January 1947, atomic energy de¬
and

Several

under
made

this

industrial

proto¬
under¬

now

has been under way for some time.

power

ities.

scale

(4) Development work on
atomic-powered
engines
for
a
large naval vessel and an aircraft

major interest and a major re¬ velopment was taken over in 1942
sponsibility in this development. by our government and the gov¬
The purpose of this paper is to de¬ ernments
of our allies, and carried

full

one

going tests.

fine

and

installation

type

therefore, that the contributing very substantially.
As a wartime necessity, this de¬
industry has both

follows,

electric

-»•••

will

mately 1,300 tons of coal is $35. It
and tho¬
is thought that these atomic fuels
rium, the two most important ele¬
may
ultimately supplement the
ments involved, are widely scat¬
present fossil fuels for some pur¬
tered in ore deposits throughout
poses, but it is not anticipated that
the world.
Although the ore in
they will supplant the use of con¬
most
cases
contains
only small ventional
fuels.
percentages of these elements, it
(2) It is physically possible now
is estimated that at least 25 mil¬
lion tons of uranium and one mil¬ to generate steam for use in in¬
indicates

Other possibilities are
The initial
development of
being
considered
but
as
yet
atomic
energy
came
largely
nothing practical has developed.
through research
in
university
Major Responsibility of Electric
laboratories
both
here
and
in
Power Industry
Europe, with European scientists

ill

compared with the cost of

atomic fuels, if cost is not a first
Scientists
tell
us
that
under
has
consideration.
Test
installations
optimum conditions, one pound of
and
have been made at the Experi¬
uranium
can
some of the problems of utilizing
furnish
the
same
mental Breeder Reactor at Arco,
this energy for peacetime civilian amount of heat energy as 1,300
and industrial
tons of coal and that under these Idaho, and the Homogeneous Re¬

tric power.

ilii

fuels

low

energy from nuclear fission
been more clearly established

ing
v/y/.y/A///.-

atomic

Energy Resources of Atomic Fuels

either for industrial heat process¬

flpi

development

great urgency and incentive to the the situation as follows:
development of atomic materials
(1) The cost of heat energy in

bomb, the
lion
somewhat

becoming

realistic.

The

■"'

first

outlook

the

to now have been military
problems, substantial effort has
been devoted to possible peace¬
time
uses.
This
is
particularly
true with respect to radioactive
Economic Commission for Europe istopes which are used in many
(United Nations Group) indicate important ways. There has been
that with the present rate of ex¬ an
increasing effort to develop
pansion in the use of electricity, the use of the heat energy poten¬
Italy will have used up all of its tialities of atomic materials with¬
hydro resources in 12 years and in the last two or three years until
Switzerland
in
15
years.
These now the matter has assumed great
are
critical
matters
which give importance.
We
can
summarize

When the tremendous extent of

have been even more fortunate

sources

Energy

culture,

cost

energy
from these
quite low compared to
energy
costs
elsewhere
in the
We have been fortunate in our
world.
Energy resources, there¬
efforts
in
the
development
of
fore, have not been a problem of
atomic energy—fortunate that we
first magnitude to most American
and not the enemy first perfected
industry.
its use as a military weapon. And
Fortunate

effects

vances

upon

consid¬

our

the

economic

ad¬

our

country and perhaps
national security.

(8) This development could be

to
10

27%.
Because
resources

have abundant fuel
V

in this country, thermal
has not been a prob¬

generation
Many of the nation's leading industries have located

lem. Areas

plants in Cincinnati recently.

new

mines

America is

developing its

own

One of the world's greatest

industrial
in the Ohio
more important
industries are attracted to this rapidly
developing "Ruhr Valley of America."
And it's more than coincidence, of
course, that so much of this activity is
up

Ruhr Valley

being centered in the Greater Cincin¬
Industrial Area. Activity which
boosted payrolls by 10,000 people and

nati

$29,000,000 in 1952 . . . which saw
$100,000,000 worth of new plants and

also

had—arid

will continue

plentiful supply of electric
power and gas to offer new and ex¬
panding industries, thanks to a for¬
ward-looking $200,000,000 expansion
program, started after World War II
by The Cincinnati Gas & Electric Co.
a

the

cost

The CINCINNATI

GAS A

ELECTRIC
to

Company

America—with

adequate
supply of gas and electricity for home and industrial consumption

generating

$ Per Ton
,

•*

Much
does

the

rest

the

world

not

enjoy our abundance of
fuels, and energy resources are a
critical

matter.

The

Netherlands,
Belgium, Italy, Brazil, Argentina,
face a
particularly severe prob¬
lem.

15.

Other countries

Z
§
o

/-Average ft

■4^

VAverage1

3
C

situations

because

lack

of fuel needed to provide low cost
for industrial processes and
to
permit a reasonable balance

heat

«/>

;

•
>

/kwhr

11/

fly

Revenue - Cetits/kwhr

2 S

•

All Services

8:
«

Dot

large hydro resources, such as
Norway, Sweden, Switzerland and
Austria, suffer troublesome eco¬

H-

which have

electric

power.

nomic

Saving Cincinnati—the city closest

Cost of Cool-

Substantial increases in the cost of

$80,000,000 worth of capital
improvements swing into production.
This area has many solid American
qualities to offer in addition to its
strategic "good business" location. It
has

obvi¬

sources

cost differential but

fuel, however, as illustrated by
Fig. 1, have created a problem in

another

have

in any event fuel has been avail¬
able and will continue to be avail¬
able for many years in the future.

(and the Greater Cincinnati Industrial Area
is becoming, more and more, its busy
center)

workshops is shaping
valley—as more and

distant from coal

other fuel

ously incur

1930

1935

1940

Fig.l- Comparison of
from sole of

1945

cost of coal with Detroit Edison

electricity.

1950

Company

1955

revenue

Volume 177

carried

Number 5228... The Commercial and Financial Chronicle

(2539)

forward by

AEC at gov¬ work and result of competitive in¬
Succeeding installations should
(d) These installations would taneously, each guided by strong,
the pres¬ dustry and they have done much be subsidized to the point where capable executives experienced in be improved units and it is within
ent Atomic Energy Act or it could to give us our tremendous indus¬ real costs became completely ob¬ the
engineering, financial,
and reason to expect proven workable
be carried forward by private in¬ trial
administrative aspects of the elec¬ installations within ten to fifteen
strength.
Our
unexcelled scure.
ernment expense under

dustry using private capital, with¬

electric

out great expense to government,

abundance of electric

if the

our

our
(e) This procedure would be a
and long step toward socialism.
exceedingly
large
use
of
Joint Ventures of Government
electric power are some of the
and
Private Industry:
Proposals
truly significant factors of that in¬
for joint ventures of various kinds
dustrial strength.
Our present electric power po¬ have been suggested for the de¬
sition did not just happen.
It velopment and construction of re¬
actors for the generation of elec¬
was
brought about primarily by
tric power.
The reasoning upon
competitive industry that had an
which these proposals is based is
opportunity to engage in our eco¬
not important to this discussion.
nomic advancement and a respon¬

present law is modified in

several

important respects.

(9)

Although

great

have

been

ergy

development

infancy

and

research

advances

made, the atomic

still

great

and

en¬

its
of

amount

development

re¬

mains. The National Laboratories
of AEC

the

are

available

for

only facilities
much

now

this

systems,

re¬

power

power,

sibility to perform one of the im¬
portant services which has made
both to our national security and
that advancement possible.
to the economic advance of our
Those
responsibilities
of
the
country. Continued use of those electric
power industry continue.
laboratories in this effort is essen¬
Ample power supply must be pro¬
search,

which

contribute

would

tial.

vided for the

areas

served.

New

discoveries

must

studied, de¬
As
stated
previously the de¬ veloped and adopted so that the
velopment
and
construction
of service is provided at the lowest
full-scale reactors for the genera¬
electric

carried out

might

power

the

(1) by private indus¬

try using private capital;

(2)

presumably

by
AEC, using government funds, or
(3)
by some joint venture in
government,

which

both

private industry and

government would participate.
Private

ties:

based

Industry's Responsibili¬
an

prise,

private

make

the

coveries

people.

develop

benefits

transportation,

munications,

and
all

have

new

those

available

This

enter¬

responsibility

discoveries,

the

ours,

competitive

industry

scientific

economy

upon

the

with

temperature-high pres¬
sure
steam
generators and tur¬
bines and high voltage transmis¬

While atomic energy has unique

and

plications,

sion lines.

industry's talents into the ef¬
Considerations
fort;
it
will
produce
creative
Perhaps the most important
thinking and it will speed the
consideration in carrying such a
ultimate development.
When the present study phases program forward is the matter of
costs and
by whom these costs
are completed, and if these indi¬
cate that the

use

of nuclear fuels

might be competitive, the electric
power
industry should actually
carry
out the construction and

only fair to indicate that testing of full-scale reactors. This,
some mutual
of course, will require the expen¬
development of the

forward in

diture

fuels

any

of atomic

use

the

results

future.

near

tainly it will be
of

moves

research

Cer¬

necessary

use

that

has

substantial

money,

which

Investment and Cost

there must be at least

aspects to

years.

sums

but this should be re¬
garded in the same light as other
research and development efforts
which
have
been
continuously

should be borne.

I have indicated

that I believe the development

atomic fuels for the generation

electric

power

rightfully

im¬

Development

Government:

Practically all of the atomic

resource

en¬

development to date has
by the government and there

ergy

put to work in the effort to ad¬

been

that

the

should

electric

assume

power

industry

the costs of the de¬

velopment.

The industry, in this
includes not only the elec¬
power
systems
themselves,

sense,

already

been

National

completed

Laboratories.

our

addi¬

carried

since the

tric

beginnings of

the

energy as

science is still in its

infancy.

We have come
long way since the

very

nuclear fission

very,

key to

finally solved
but we still must solve
greater problems in putting
this new resource to practical ci¬
in

was

1939,

vilian

uses.

the

is well agreed that many of
scientific and technical prob¬

for

weapons

civilization. This clearly is
are those who believe this situa¬
lems yet to be resolved
are
of
responsibility of competitive tion should continue. With some
concern
chieifly to government,
industry. Since the most promis¬ this feeling is the result of gen¬
ing use of atomic energy is in the uine concern over defense and largely in the matter of weapons.
Other problems are primarily re¬
generation of electric energy, the national security. Others believe
lated
to
industrial
and
civilian
electric power industry, I believe, that because the
government has
applications. It is equally recog¬
has great responsibility and great
spent vast sums for the develop¬
nized, however. that all of these
opportunity in this situation.
ment, it should continue the mo¬
problems are definitely inter-re¬
If we look back for a moment nopoly for the benefit of "all the lated and
that they cannot be com¬
we
will
In other words, know¬
note
that
the
electric people."
pletely separated.
Chemical or
power
industry is the result of ingly or otherwise, they are advo¬ metallurgical processes, for exam¬
definite move toward
developments
that
have
taken cating a
ple, which would simplify the re¬
place over a very long time. Man socialism.
finement of fissionable materials
vance

the

has known fire

the

duce

heat energy for

From
past
experiences
we
Probably should expect that development by

years.

fire

prehistoric times to

pro¬

government of atomic energy
for
commercial
generation
of

used

electric power would have the

first

were

thousand

many

industrial

the metals

uses

which

were

for weapons.
a

Althougn Hero built
primitive steam turbine in 130

C., it was not until Watt de¬
veloped the first practical steam
engine
was

Since that time developments in
use

with

of heat energy have come

increasing

rapidity

—

run

it would be
limi¬

steam

be of

inesti¬

connection

reactors for industrial
•

with

applications.

The atomic energy development

ward

because of fund

fol¬ therefore should

lowing results:
(a) In the long

would

value

carried

for¬

two broad fronts; one in¬
volving those matters of primary
on

importance

to government, and
involving matters of

tations, lack of coordination and
duplication of effort, fear of mis¬

1769

ful work.

the

mable

the

ineffective

that heat energy
harnessed to accomplish use¬
in

the

takes, and bureaucratic burden.
(b) These difficulties would re¬
sult in extremely high costs and
a
great burden, indeed, on the

There

tween

taxpayers.

maximum results

other

greatest

operation

industry.

closest

coordination

and

the

efforts

two

duplication and to
this

concern

should

assure
are

co¬

be¬

avoid

that the

(c)

way

can

move

RESERVES

TOTAL

SOURCE

UNIT

ENERGY

BTU

DATA

610 Billion
CRUDE

OIL

Barrels

Weeks and

11.5
GASOLINE

Barrels
Billion

Barrels

560
NATURAL GAS

6.4

106

0.74 x

1017

6.4

106

1017

Trillion

Cubic Feet

Association

Per.

Bureau of

1017

Cu.Ft.

13,500

3482

Tons

Mines

the

should

systems

further

efforts

study

this

one

may

not

prove
we

initial

commer¬

should de¬

1017

velop

1018

ble energy situation in many parts
of the world, and
our
need
to

1700

9,000

1018

the

rapidly

TOTAL CONVENTIONAL

maintain
25

Million

URANIUM

Tons

Raw Materials

Division of

TOTAL

NEW

106

at 1

,/n

1018

Tons

1800

FUEL

1018

World Reserves of Fossil

Fuel and Nuclear Energy

possible. The unfavora¬

world

face this development with broad

interest and effort. A single pro¬
ject carried to completion will not
be

adequate.

projects

Preferably
there
independent
carried forward simul¬

several

Area

Resources

leadership, give
this effort.
The industry should continue to

should
Fig. 2

problems

real urgency to

Breeding

AEC

1 Million

THORIUM

3.5

technical

develop¬

While

722

WEST

undertake

and

area.

cially competitive,

BTU

14,000

lUlllllllllllllllllttllllll

major items in the genera¬
tion of electric power, the electric

Billion

COAL

COLORADO

A GROWING

of the

ments

1000 BTU

WYOMING

future.

power
x

Mines
American Gas

the

parts of the United States is

Institute
Bureau of

lllllllllilllllllllllllllllllllllllMIIIIIUIIIIIII!

Because the cost of fuel in many

1017

American
Petroleum

620
SHALE OIL

106

Moulten

Billion

NATURAL

pres¬

COMPANY IN

IDAHO

ent energy resources at some time

6.4

effectively supplement

may

A GROWING
iiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

UTAH

forward

of heat energy—a new fuel which
WORLD

Serving In

obtained. In

Large-scale developments
would immediately present a rapidly and effectively.
combustion engines, modern steam widespread threat of governmentFrom the standpoint of industry,
and
turbine generators and gas tur¬ financed
operated
thermal and the electric power industry
bines.
generating stations. In other words, in particular, we should regard
These
atomic materials as a new source
developments
are
the more government in business.
boats,
locomotives,
vastly
im¬
proved
steam
engines, internal

FUEL

the

responsibility of the electric power
industry.
It follows,
therefore,

even

fundamentally it is a
to be developed and

far-reaching

industry. Competition
will bring more

groups

the

with

high

ern

agricul¬

properties

and

manner

vigor it developed the mod¬

com¬

ture and countless others.

new

same

petroleum,

medicines,

dis¬

done

power

between

but also the electric power equip¬
ment manufacturers, the engineer¬
industry.
ing industry, power users, and
tion, much research currently in
Developments of practical value
others who have an interest in
possible cost consistent with sound progress is directly related to will come slowly.
If proper effort is exerted initial maintaining our high standards of
business practices.
large power reactors, and a vast
service at the minimum practical
Atomic energy, or atomic fuels, amount of additional research has projects could come into service
cost.
ten
offer a new source of heat energy been suggested and is needed be¬ within
years,
and perhaps
All of these would benefit from
which can be used to generate fore power reactors can be com¬ somewhat sooner. The first instal¬
the development and all should
electric power. The problems are mercially
competitive.
The re¬ lations obviously will be experi¬
share in the burden.
difficult and economic results may search would benefit not just one mental and exploratory in nature,
In the matter of research and
not be achieved for many years to single effort, but rather the entire but
they will help solve many
there are areas
come.
The efforts will be costly, effort. Each development or ad¬ problems. These installations development,
where the problems of interest to
but probably not as great as pre¬ vance, large or small, would be might be complete generating sta¬
government and those of interest
a step forward in the broad
dicted.
The technical and
eco¬
prob¬ tions or they might consist of only
to industry cannot be delineated.
nomic problems will tax human lem of bringing atomic energy to the reactors and necessary appur¬
These problems, in most instances,
which
would
permit
ingenuity but they must and will its ultimate useful place in our tenances
can be studied only with compli¬
be solved.
economy.
thorough tests of the reactors and
cated facilities such as are avail¬
their
operation.
Certainly such
It is the responsibility of the
able in the AEC National Labora¬
Looking to the Future
reactors would be so designed and
electric power industry to study
tories
and
the results of
these
In
looking to the future, we constructed that the electric gen¬
and develop these possibilities in
Continued on vage 32
should keep in mind that atomic erating facilities could be added.

Reactors for Electric Power

tion

tric

P. O. Box 899,

booklet mailed upon request.
Dept. K, Salt Lake City 10,

Utah

The Commercial and Financial Chronicle

(2540)

Continued from page

inception.

its

since

years

all anticipate further

.Thursday, June 11, 1953

We Continued from first page

year-to-year

advancements.
Atomic

Atomic Powei and the

became a

first

energy

unlocked the secret to nuclear
sion

Elecliic Industry
would be

studies

entire atomic energy

value to the
To bring about these conditions
development." the Atomic Energy Act ot 1946

thought that much of ?h"uld be> amended in the followthis work could properly be un- mg respec
.
certaken by government, but this
(1) To permit private enterprise
is not necessarily the case. While to build, own and operate atomic
the costs
in
question might be energy plants.
substantial, they would represent
(2) To permit private enterprise
only a small fraction of either the to acquire own and dispose of
total
AEC
budget, or the total fissionable materials.
ccst of a practical reactor project.
n\
Tn
nprmit
nrivate
enterCertainly, this is a matter of de¬
tn !nn,,irh
anH Hisnnse
It

•

nwn

to acqu r

prise

tail.

source

ma er

Exact'y how the necessary funds
would

yet

Those

determined.

should join together in

interested

maximize their effort,
relationship might
be will need serious thought. There
are
many
legal
considerations,
to

groups

eral

this

upon

direct bearing

problem.

well

understood

the

that

Atomic Energy Act, as presently
constituted, provides a government

monopoly

the

field

atomic energy. If private industry
is to engage freely and actively
in this

development, it is essential

that rights of ownership be given

private industry so there may
normal opportunity to re-

be the

investments

cover

from

efforts.

practice

which

profi'

the

usual

and

This

makes

for business and

possible

industry to exist

to expand.

Thermal

atinS

stations

power

ordinarily

rwe* ov^

underits
its

conventions
ur

attend

directing it to useful applications.
Industry in general, and the
electric power industry in particu-

lar, recognizes the potentialities of
this situation.
America's industrial machine is
the world's finest—in skilled man-

because

opportunities

we mercial

anH

con-

that

„c

tetter'Tob^in front us.

place as a useful factor in
civilization only when indus- Eerving
try succeeds in harnessing it and /omers
proper

our

stockholders,
nation

Lab®1" Legislation

our cus-

our

wnen

with what is going on in

-n

all parts of

the country> The conhelps us to establish and

vention

given

again

by the Federal Government
matter of labor legislation.
to
the
enactment of the

to the

is being

Attention

keep

Prior
Taft-

acquaintanceships valuable Hartley Law, the Board of Direcin the conduct of our company tors of the Institute approved a
business. It gives opportunity to statement of policy prepared by
voice significant views. It helps one of its committees setting forth
P°wer> in technical and scientific Us to keep our perspective, io the position of the Institute with
know-how,
and
in
industrial clarify our thinking, to develop respect to the labor issues which
equipment. We must aim at pqt- informed opinions and to grasp led to the enactment of that law.
ting our industrial machine to its the real significance of new de- The statement set forth at that
fullest possible use in developing velopments.
time will be found to be sound
atomic
energy's
promise
of
a
Electric companies have much and applicable today.
I recombetter, more abundant, and per- business with neighboring utilities mend that from time to time you

«,

have

years.

use

could

have full control of the plant
fnv i+c
for its useful life. rp.
The organiza¬
^

would

need

know

that

could obtain the necessary atomic
materials for fuel and that it could
or

dispose of fission products

through

the

normal

channels

commerce.

with condi-

ducted in compliance
set

forth

license

the

standards to be

accord with

pre-

scribed by the Act.

...

renew

PORTLAND
Dinwoodie is
Merrill

Maine

Huah

—

with

connected

now

Lynch, Pierce, Fenner &

Beane.

discharge of

ties+to

and trade

industry

convention

the

for

leaders

affords

"Electric

secret protection subject only to
(Special to The Financial Chronicle)
top leaders in the industry and to
full disclosure to the Commission
BOSTON, Mass.—George Put¬ acquaint themselves with the
for its own use for purposes of nam, Jr. is now associated with broader aspects of the electric
protection of national security.
Putnam Fund Distributors, Inc., 50 utility business. It lifts their points
The national security and

safety state
aspects of the atomic energy situati0n

are

fully recognized in sug-

have

not

found

should

possible to continue

the

conditions.
Licensing, 'arrangements, subject
to cancefiation only for failure to
present

______.

oi
law'
f
assa, e that fissionable materials and classified information
does

not

pass

into the possession

Cii-onicle)

stover, dr> *s

Standard

now

boutil L,ake Avenue.
,

-J

W lth

I--

Hamilton

(Special

Manage t

to The Financial

Chronicle)

SPRINGFIELD, Mo.-Harriston
T.

Wells

agement

with

Hamilton

has advanced

bower

(Special

here

industrv

tremendously in the

they

NEW

152

industry.

and

It is important that the top ex-

Holland

For years

local

to The

Financial

HAVEN,

10,

They

now.

Chronicle)

Conn.—Max

ca-

of those who will be the top

and 20

owe

years from
this to those who

after them.

come

It is desir-

L. FmJt ab!e !hat the key men of each
InCOme Fu"ds> company and the younger potenStreet.

now

Temple

withi„

tial leaders and division managers
attend
conventions
occasionally

Tear-afier-year

the

stimulation
be

why

the

develop-

here.

That

conventions,

•

people who should

That

devising
An

have

are

attend.

and

obtained

objective

our

programs.

GROWTH

Adequate

Power

The
been
year.

EXPANDING,

obtained
and

areas

there

RECORD

1950
1949
1948
1947

1946
1945

$889,117
682,425
562,018
497,363

369,895
303,584
238,078

211,307

"The

there

will

season

again be
such

adverse

occurred last

Fall.
Kilowatt Hour
Sales

95,032,000
82,235,000
67,193,000
57,847,000
48,966,000
41,674,000
34,775,000
29,335,000

The electrical manufacturers ad¬

Customers
Served

21,427

vised
year

that

12 V2

they

will deliver this
million kw. of gener¬

ating equipment.

20,138

greater than

18,640

capacity
of
plants in 1920.

17,002

the

12 V2

15,749

installed

14,286

present

12,427
11,037

Colorado Central Power Co.
3470 SO. BROADWAY

should

hydro

Gross Income

$2,472,534
2,177,446
1,862,459
1,641,764
1,421,286
1,233,828
1,046,834
882,151

power

manufacturers

that

adequate
supply
of
power
throughout the coming year in all
parts of the country except pos¬
sibly in the Pacific Northwest if

AREA

1951

the

STABLE

1952

from

clear

from

the United

Friendly People"

ENGLEWOOD, COLO.

during

kw.

the

estimate

10 million kw.

not

all

will

course

million

sound

written.

tion to

will be put in op¬

Our survey shows that the entire utility industry will add about
30 million kw. in the three
years
1953

1955, inclusive.

Not only
ample capacity to
supply the power demand in the
years ahead of us, but plainly we
have
are

have

Uirt

„

...

big selling job to do if

to make the most of the

The statement

fundamentals and it is

today
Let

when

call

your

it was
atten-

few of the 15 principles

adopted.

government

should

en¬

development of private

Much

of
river
development
accomplished by noncapital.
Licensing under the Federal

can

Federal

Power

Act

should

encour¬

aged.
Local agencies, not the FedGovernment, should be respon¬

sible for the adequacy of power
supply for non-Federal needs.
All projects
should be eco¬
nomically justifiable.
Benefits
exceed

should
costs

be required
by substantial
wisdom of this

margins.
(The
nrinciple has been demonstrated
by

many

recent

instances

underestimation

gross

costs

by the Federal agencies.)
Power should be sold at

mar¬

ket value.

Disposition cf power should
by non-Federal marketing.

Federal power should be sold
without discrimination.

about

eration.

will

response

then

capital.

The

year.

that

States.

dealt with

This amount is

the total generating
all
electric
utility

the

ag0 at this Convention adopted a
brief statement of principles and
policies v/ith respect to the development of water resources in

The

Index stands at a high
Nevertheless, the latest re¬
ports of our Power Survey Com¬

make

Revenue

con-

President's
Water
Resources
Policy
Commission, the Edison Electric
Institute prepared and three years

Industrial

mittee

from

courage

sales
of
electricity have
running well ahead of last
The Federal Reserve Board

resources.

request

Supply

level.

IN A RAPIDLY

Year

national

manv

cerning

Ahead

Before Depreciation
and Income Taxes

and

agencies have been

natural

exert on the future

can

leaders

Those

THE

the Federal and State

ecutives be here for the®influence

ment

Gross

Resources

themselves with the development and preservation of our

GOLDEN •

Water

Development Policy

Hnvprnmpnts

will
Haves is

Sound

to cause them to lose contact with
what is going On generally in the

for

KEENESBURG

cus-

utilities

the

they

Corporation,

Income Funds Add

electric

the

of the customers
—

company, yet the nature
of their work tends to isolate them
from other industry leaders and

reers

I should like to emphasize

serving

investor-owned

Man-

Building.

Conclusion

the

most

,and managements should,
greatest degree possible,
be state laws providing for reg¬
ulation
and
enforcement
by
state agencies."
ees

unfriendly hands.

that

job
To

tomer.
-

essen¬

special laws regulating the la¬
bor relations of utility employ¬

A°" °f Califorma' 87 arc the

,y,

their

portant

con^ly

Financial

intolerable and believe that

under

to The

are

When necessary any

of service.

vision

own
jobs. It also offers
opportunity to stimulate divi¬
sion managers in their very im-

PASADENA, Calif/—George B.

curity regulations create difficult
We

(Special

view and enlarges their

utilities

local enterprises subject
primarily to state regulation as
to rates, finances and standards
tially

Standard Inv. Adds

gesting the above modifications of
^e law.
Obviously, present sesituations

Street

to
possibility of in¬
of
utility service

due to strikes.

the

contact with

utility

necessary

the

terruptions

oppor¬

potential

younger

make

the electric

public

appears

minimize

lationships within the industry.

out
the

industries

ventlon helps to develop these retunity

With Putnam Fund

singling

tion

full responsibili-

our

customers. The con-

The

(6) To permit private enterprise
to attain normal patent

gener-

fuels would need to know that it

sell

our

private

permit

(5)

t{,ese

electric

t^g mZaat^ "farting private
capital
plant to
atomic

tion

St3Afnm?r>°inpr«?v^l?Vachieve
Atomic energy will acmeve

prise to obtain licenses from the
Atomic Energy Commission sub-

tions

The Atomic Energy Act of 1946

and

far

tions, which have

end

distribute

and

sell

use,

products and
by-products produced in an atomic energy facility,

01 Electric Power

intervening years

in the
come

fis¬

enter- haps more peaceful world of the and with electrical manufacturers. read !he statement to refresh
future.
Friendship
and
mutual
under- your views on labor questions. By
—A
standing and a disposition to con- way of example I quote two items
as
anti-trust laws and Fedjecf oniy f0 the requirement that
With Merrill Lynch FlrTOH-HBider the concerns and opinions of from the statement:
Power
Commission
regulaoperations
thereunder
be con(special to the financial chronicle)
one another are important in the "No specific Federal Legisla¬

such

the

what

but

(4) To permit private enterprise

made available has not

been

and

have

Progress and Prospects

scientists

real factor in 1939 when

com-

I think it

there

fairly be said that
growing
realization

can

|4iroiighoat this country, particu1. y in,

West, that local plan-

Plng and !ocaI responsibility must
haveJ ® dominating role in the
sound development of natural resources and that there is grave

danger to 'h,e ®vlJval,

Iocal

government if the Federal bureaus
assume

the

determining role
development of natural

in
re-

legislation were
the

Bources.

en¬

acted in conformity with

rec~

ommendations of the 1950 Report

Water

President's

the

their customers, are
to

14%
the

heavily taxed changes

government.

the

support

the present time

Re¬

Commission it
only eventuate in national
Policy

sources

(2541)

they

paying
to support

bureaus

all times

up the well-being of its
They have territory and thus helping its
and own business to grow.
Congress should
There is no magic in the power

and

water
Let

been

tried

this

for

natural

control

moment

local

grossly unfair to the cus¬ Federal Government has entered
the power companies into other fields of business. The
them
to
be taxed through power industry is vitally interre¬

for

their

re¬

and
individual freedom with the long-

sources

support

tomers

of big gov¬

the long-range effect
ernment

bills to

power

support

the lated with practically every other
industry. A threat to nationalize

government and then for the gov¬

local government

ernment

exempt by law from

taxation those customers who ob¬

results when power com¬
tain their power from local and
panies develop water resources.
national governmental proprietary
The development by the compa¬
business. At present tax rates the
nies is subject to local and na¬
cumulative effect of this tax ex¬
tional
regulations.
They must
make their plans and their opera¬ emption is enormous. No industry,
however efficient and progressive
tions conform to the mandates and
range

wishes of local authorities

well

and

destroy

ness

any American busi¬
industry is a threat to de¬

the

stroy

American

in all
industry.

enterprise

free

business

regu¬

and the Fed¬

lations of the local

The

Government.

agencies

Federal

not under such regu¬

are

lation.
A Plea for Fair Competition From
Government Proprietary Business

that any fair-minded

believe

the

all

the

will

who

person

facts

inform

must

that

conclusion

himself
with

agree

the

Federal

Changes in Money

and

In recent months

Cost

there has been,

a substantial increase in
interest
company's contribution to area rates on long-term debt. Becauso
development. It has no money to the electric power
industry fcj
squander on popular ventures. It
pre-eminent among industries fin
must pay interest and dividends to
the amount of capital it requiredthose who furnish its funds and
and the slow rate of turnover cap¬
its rate of return on its invest¬
ital, the interest rate on bonds t#
ment must be kept moderate. The
very important in its rate making
Public. Service Commission will
and financial problems and thkf
see
to that.
But to carry out its
change is a matter of concern to
functions in serving agriculture,
all of us. Rate increases obtained;
commerce and general industry it
during the past few years to offset
must have trained personnel who
the rise in the cost of labor ami
are continuously engaged in plan¬

its

That inter-relation has been well

demonstrated in

number of for¬

the requirements of ment,
such tax inequity. Either the in¬ It can and does put up a good bat¬
national agencies.
Their work
tle against odds, but certainly the
must conserve and develop nat¬ equity must be corrected or, in
ural resources in conformity with time, free enterprise in the power power to tax is the power to de¬
field will be destroyed.
stroy. Big government is bigger
the public interest, both local and
Furthermore,
the
proprietary than any industry and if the basic
national. They are not and cannot
be a law unto themselves.
Even power business of most govern¬ inequities I have pointed out are
mental agencies has the unfair ad¬ not
corrected,
the
government
if they were disposed to conserve
will
wind
up
by nationalizing
and develop natural resources un¬ vantage that interest on the bonds
sold by them to provide money many of our basic industries in
wisely they could not abuse their
for this business is also tax ex¬ America as was done in England,
power because they do not have
and through them will effectively
it to abuse.
They are subject to empt, a fact that materially re¬
duces the interest rate on such dominate practically all business
control under the laws and
eral

andI

industry."

the cos^
prevailing. It bf£?,vacquainted with the territory and comes
critically important thai*
eign countries and America can its
possibilities and know how to Public Service Commissions give
profit from the lesson they afford.
put electricity to work to earn
adequate consideration to changed
engineering and manage¬ The free enterprise system is ef¬ more for the customer.
in the cost of money if we are to
can
indefinitely
survive ficient, vigorous and resourceful.

meeting

rightful share of commerce

build

regard

but it is

land.

contrast

to restrain themselves.

and 9%

Government

Federal

ask

are

of gross revenue
Federal

are needed to correct the tive force in the development of
At lack of fairness. It is too much to the area that it serves, helping

governments, a found wanting.
control over all water and land. total of 23 cents out of every dol¬ act to reestablish fairness in the
There could be no real freedom in lar they take in. It is proper that provisions of its laws.
The issue here is much broader
this
country
with the Federal along with the rest of American
Government
in full control of business they should pay taxes, than the power industry. The

could

3SI

Number 5228... The Commercial and Financial Chronicle

.Volume 177

materials were based on

ning and men who are thoroughly

The

company

power

is, there¬

of money then

forward

carry

successfully

the

fore, especially qualified to con¬ large
construction program wo
tribute to area development work are in the midst of. This is not n
and has an unusual opportunity matter that company management
for civic leadership.
that
even

such

work

though

such

Do not think
unappreciated

appreciation

not be recognized for a long
time or expressed. I will take the

may

liberty

lines of

land

quoting

from

few

editorial in the Cleve¬

"News"

March

1953,

27,

commissions can af¬

regulatory

ford to treat
In

lightly.

the long run,

however, it felt

to all free enterprise,
particularly to the electric

important
and

business, that thrifty and
people be given in¬
centives to save and invest theisr/
savings with confidence in the
future buying power of the dollar.
This change in interest rates is in
the direction of sound and fafar
treatment of the investor and we
should clearly understand the sig ¬
nificance of this point.

power

industrious

commenting on the contribution
of the Cleveland Electric Illumi¬
asking for fair
nating Company and its President,
cies
competition, let us be sure that
Elmer Lindseth, a past President
we give fair competition in return
real
of the Institute, toward the wellFederal
taxpayers
to
subsidize and that we go even beyond the
being of that area:
part of the power bills of the actual requirements of regulation
"This program (urban rede¬
consumers
of
the
underpriced and law to assure this in our busi¬
velopment) comes to us from an
Our engineers who have beer*
electricity is widespread and has ness dealings with neighboring
earnest, hard working industri¬
been recognized from its begin¬ municipal
and
co-op
systems.
battling to offset the increased
alist
who
knows what he is
They are not charity subjects and
nings.
costs of labor and materials in
If power were sold to cover the can and should pay their way like
talking about, who hasn't spent
the past 20 years by improvements
true cost to the Treasury, includ¬ any
other proprietary business,
as
much
time
talking as in
ing an amount equivalent to the but we can be helpful to them,
Continued on page 341
working to get Cleveland its
Federal taxes that would be paid they can be helpful to us. They
if
the
property were investor- are our neighbors, and let us see
and

bonds.
The

practice by Federal agen¬
of selling power below its
cost
and
thereby forcing

industry.

While

•

are

in its legislation, its
regulations, its interpretations of
laws and regulations and its ad¬
ministration of them, and in its
to it that we are sound and fair
judicial proceedings, has heavily owned, in most instances the cost
of Federal power would equal or in all our dealings with them. It
discriminated
against
investorbecome
exceed the fair market value of will
apparent to them
owned power companies and has
that in reality we are their best
fostered
the
nationalization
of power as established by the pro¬
Government

electric power.

I need not argue
Many eminent persons
in the past year, including Presi¬

the point.

from

cost

duction

in the

sources

area.

other

power

tive

administrative

and

that

contend

action

actions

these

have

preference

In the

of the TVA, no in¬

case

monies received
necessary to
preserve our
natural resources for the people through appropriations. Indepen¬
and

greed

them

protect

corporations.

big

the

from

speaking

efficiency

the

resourcefulness

and

the

free

enterprise system, I call to your

dent

estimates

came

made

Serving

attention the very heartening re¬

trend from govern¬

versal of the
mental

power

business

the

Northwest toward a strengthening

payer.

terest is paid

been

friends.

Hence there

the
dent Eisenhower and former Pres¬ preference clause, but by ignoring
and understating costs the power
ident Herbert Hoover, have stated
is sold at prices that carry a heavy
the case.
from the Federal tax¬
The defenders of such legisla¬ subsidy
would

busi¬
that
region where the
Government
has
been

investor-owned

ness

Federal

power

ago

pouring

out

with the answer that the

millions

THE GREAT SOUTH WEST

of dollars for power fa¬

years

many

hundreds

yardstick was 18 or less cilities. Another very heartening
long when it was set up. development has been the bold
the establishment
of the enterprise of five companies in
Tennessee Valley and the Pacific organizing Electric Energy, Inc.
are
under local
regulation and
projects the cost of to challenge successfully the mo¬
control and benefits or advantages Northwest
construction has doubled, yet in nopoly
to be had from the building of
of the Tennessee Valley
neither area have rates been sig¬ Authority, with its tax-free, in¬
power dams or from participation
nificantly increased to the pref¬ terest-free business, in preempt¬
in government built power proj¬
erence customers.
ing the supply of power require¬
ects must of necessity go to their
The laws governing the sale of ments
for
the
Atomic
Energy
customers.
And further, in mak¬
This venture was
ing such developments the com¬ power from Federal projects set Commission.
panies must conform to local sen¬ up certain preference customers, followed shortly thereafter by the
timent in conserving and using the that is, local governmental bodies organization of the Ohio Valley
and cooperatives. These are agen¬ Electric Organization backed by
natural resources. Generally they
must also obtain a license from cies that have not been taxed to 15 power companies to go ahead

Their

contentions

not

are

valid.

They deliberately ignore the fact
that
investor - owned
companies

TVA

inches
Since

help pay for the facilities built with a $400 million power gen¬
by the Federal Government, yet eration project. Another similar
they are given preference in buy¬ development is the prograrn»of
the overall plans of the various
power
companies in New
Federal agencies with respect to ing power that is priced to make five
conservation and utilization. What this preference attractive to them. York State designed to carry out

the

Federal

organization can
our

Commission

Power

their work conform to

and make

natural

better conserve

resources

than power

companies which have to conform
their plans to local regulation and
must
satisfy
conditions
deter¬
mined

ment?
or

the

Federal

Govern¬

local

agencies
the

enforce

establish

conditions

and

under

their

construction

plans

and

their
power
facilities.
They follow their own considera¬
operate
tions.

practice is obviously designed the redevelopment of power at
municipalities and rural Niagara Falls, the site where the
districts
into
setting up power privately - owned
Niagara Falls
systems of their own to qualify as Power Company in earlier times
preference customers under the wrote an illustrious page in the
provisions of Federal law.
history of private enterprise.

When it

comes

to the

exer¬

cise of monopoly

lure

On the other hand, no state

which Federal bureaus will carry
out

The

stated

nents of these

the public re¬ ing and can play in the develop¬
developed for ment of the areas which they
benefit of the public and not serve.

tices

argue

sources

the

This point brings me to the part
before, the propo¬
discriminatory prac¬ which power companies are play¬

that

should

private profit, but in all fair¬
who but the public benefits
power is sold to regulated
investor-owned companies?
Any

for

ness,

there is nothing
to compare with the monopolistic savings in cost to the company
powers that Federal agencies ar¬ due to purchases of low cost power
go to the customers the company
rogate to themselves.
Their
tax
money
has
In competing with private busi¬ serves.
ness
there are several weapons helped build the projects. Surely
which

the

Federal

Government

The Utility

there is

fairness in

provision

Company's Role in

Area Development

the

utility

duct of

its

company

in the con¬

business must engage

efficiently in long-range planning
and have the courage to make de¬
cisions far in advance of operat¬
ing

necessities.

It must be Pr®~

to serve the power needs
of the territory.
It can grow no

(1)

Wilmington, Delaware

CENTRAL POWER AND LIGHT
PUBLIC SERVICE

SOUTHWESTERN

COMPANY OF

COMPANY

OKLAHOMA

GAS & ELECTRIC

pared

Two of these are important: that denies to certain classes of
faster nor prosper more than the
tax discrimination, and (2) American citizens a government
selling power below cost to pref¬ subsidy extended to another class. territory it serves. It cannot shift
This
is
what
we
mean
by its place of business. On the other
erence customers. Investor-owned
hand, it can be a most construc¬
power companies, and therefore unfair competition, and legislative
uses.

CENTRAL AND SOUTH WEST CORPORATION

WEST TEXAS UTILITIES

COMPANY

(2542)

The Commercial and Financial Chronicle..
.Thursday, June 11, 1953

Continued, jrom page

throughout.

must

signt of the fact that

that

construction and oper¬

use

United

and

States.

Securities Salesman's Corner

everyone
It serves

of the occupied homes

equally high percentage of

By JOHN DUTTON

the fixed locations where work is

"How to Build

performed.

Electricity's part in
serving these activities continues
to
grow
and multiply and the

to unmatched degree. Our

present standard of living has de¬

ating methods may find that tney
have a new economic balance to

the

about 98%

Of Electric Power
in designs,

into
practically

and labors of
in

industry
the life

importantly

enters

Progress and Prospects

lose

not

our

veloped largely from that growth.
of our
com¬
strike in their planning and de¬ Continuing growth and new hori¬ watchful attention
mittees keeps our industry from
signing because of this change in zons promise a new era of elec¬
trical living. Light's Diamond Jub¬ falling behind in any of its accu¬
the cost of money.
responsibilities to
the
The investor-owned companies ilee affords us an opportunity to mulating

David L.

Babson, the investment
has written a brochure

counsel,
that

describes

the

of securities or loans.
These are
In the very near future infor¬
large figures and they are quoted mation concerning the plans and
to emphasize the significance
of indicating the part that electric
any change in the cost of money. power companies, in conjunction

Diamond

Light's
Next

year

Oct. 21

with companies and

Jubilee

in other branches of the electrical

shall industry,

celebrate the 75th Anniversary of
Thomas A. Edison's successful in¬

from

our

very

significant turning point

achieve

his

A Tribute to

Board

has

Directors

established

industry in the world shares

information

in tric

lesser

freely as the elec¬
industry and no organ¬

power

ization

that

know

does

financial

the

inde¬

the

Committee

Kennedy,

Oklahoma

Messrs.

President of

Gas

and

Electric

Harllee
of

Company,

Branch,
Jr.,
Georgia Power

the

Walker

and

pendence

later

comfortably

achieve

of the tables used

Donald

President

Company.

known

tax

For

Cisler,

counsel, J.

Lasser

Casey.

children,
have

one

in the brochure

the

Then

Mr.
of

growth

puts

About

Babson

takes

comparative

the

various

yardstick

results

groups

mentioned above.

his

growth

the

between
stocks

the
companies,- of
industries, and factually

record

sets

Then he
the

three

requisites of. deferred income, in¬
ternal

growth, and safety of prin¬
the test of experience. I
think you will agree that he makes
quite an imposing case for * the

cipal

purchase of the leading securities
in

such

industries

natural

gas,

synthetic fibres, research special¬

married

Here's

prepared by the well-

was

and W. J.

inde¬

unless

years

approach is used.

which

Edison

Jubilee to

reasons

with

man

savings

two

this

This

for the sturdy growth and

his

current

compound

tax

could

would

invest

ties, chemicals, oils, labor saving
machinery, paper, etc.
' *

payments at

interest,

would

all

follows:
11

And

Years

Income

by Taxes

at 1952 Kate

35—

$103,683
408,762

Eventful

Period
These

tory of electric
individuals

Our

power.

has

been

role

cast

this eventful period of time. I be¬
that we are alert and are

lieve

measuring

$10,000
25,000
40
20,000
40— 50,000
45
25,000
50
50,000

great days in the his¬

are

If
are

Savings Taken

216,733
909,740
217,030

439,240

have

you

the

fence, who

obtain

copy

digest it

are

who

afraid

portfolios realisti¬
that if you will

believe

clients

some

to look at their

cally,

Are

We Are Living in

do the committees of

the Edison Electric Institute.

that

sure

they have done a spendid job in
the arranging the program.

sound practice faithfully followed
for nearly 70 years is one of the

members

Detroit

convention unfolds you will agree

developments in every part of the
industry to the attention of all its

the

The

such

Spon¬
soring
Committee,
a
Planning
Committee and a Program Com¬
mittee. They will present a plan
for celebrating Light's Diamond
a

the Board of Directors

those

even

higher brackets

Program

in the life of people gen¬ a
thorough job of bringing
erally throughout the world.
latest experiences and the latest

The

this

new

Company;

Our Committees

for

program

What

extent

Institute

designed to give help¬

Example:

difficul¬

many

own

ful attention to matters of present
and
future concern
to
us.
Our

President

present position, was a
a

appropriately under¬

can

take will be made available.

vention of the incandescent lamp.
This event, as we now can see

the life of America and to

organizations

have

convention

long-range uptrend.
Dow Chemical.

ties that the average investor must
overcome
if he is to be able to

about $2.6 billion in 1952 refresh the minds of the older public. We owe our thanks to the
He shows and proves
and at present construction rates generation and bring to the minds Chairmen and members of these pendence.
it would
appear
that they will of the younger generation this committees and to the companies why prewar methods of building
a retirement
who
program are obsolete.
support
the
Chairmen
in
spend about $3.0 billion in 1953, historic event and what its signifi¬
their responsible Increased taxes and cheaper dol¬
of which amount about two-thirds cance has proven to be and what carrying out
lars have made it impossible for
work.
will have to come from the sale it offers for the future.
spent

Retirement Fund"

of this brochure and

that you either agree
or disagree with David L. Babson
(and I think you'll agree) that
so

you'll have something to go' out
and tell your clients that will help
you to do business and will also

help them.

The David L. Babson
organization is located at 40 Broad

opportunities

our

tute would be called upon to assist

unhalting advance which the
power industry has made through¬
out its history, an advance that
has seen no let up in the rate of
growth and in the striving for im¬
provement in every phase of the

Says David Babson, "It is clear Street, Boston 9, Mass. Why not
responsibilities, but this from
the foregoing that what our write and ask them for a copy of
self-congratulations.
fathers saved for retirement, we "How to Build a Retirement Fund
We have great work to do,
great are
paying out in income taxes." Under Today's High Taxes and
decisions to make, important poli¬
Living Costs."
cies to establish, much commercial
The Tree Basic Requirements

in the preparation of Jubilee

business.

development work to accomplish,
To quote further, "What invest¬
awe-inspiring engineering oppor-, ment
principles then, must guide
tunities ahead, heavy responsibili¬
the investor if he is to be success¬
ties and important decisions in the
ful in building a retirement fund
matter of finance, questions that
against today's obstacles?
There
tax our capabilities
in relations
are three tests

at its

meeting tomorrow. An im¬
portant feature of this plan will
deal with
of the

the

community celebrations

Jubilee

fostered

by
The Insti¬

utility companies.

terials

which

mittee,

the

made

tives from

representa¬

number of

has

concluded

the

furtherance

ma¬

Program Com¬

will

One
as

the

rewards

serving

President of this Institute is to

companies, become better acquainted with the
useful

such

commu¬

men

toric event.

who lead and those who

stitute

nity recognition of this great his¬ have
The

our

appreciation I

before

incandescent^lamp

committees.

the

role

never

con¬
now

had

they perform
aspect of our

began
studying every
the mass use of
electricity. Free )perations and in fostering the de¬
enterprise fostered the growth of velopment of sound
practices

and
is

our

time for

which

with

the

local

wise

are

labors

this work well,

and

the

labor),

our

promote
investors and

will

advance

America

enterprise there
to

even

and

contemplate

would

slacken
rest

indi¬

the

and

our

evil

efforts, should
should

oars,

country

should

ensue

our

free

We cannot afford

companies

that

can

vidual freedom.

allow

our
our

course

closing,

ment

ahead of the
power

keep well

ever-increasing demand for electric

in the thriving

area

they

serve.

200,000-kilowatt generating units

are

Five

new

scheduled

early '54.

see
we

growing

are

one

seg¬

of the

economy functioning
member of the team.
In

one

come

shall reread

again and again from the London
speech of the General, now Presi¬
dent Eisenhower.
"The winning of freedom is not
to be compared to the
winning of
a

game.

Freedom

has its
life in the hearts, the
actions, the
spirit of men. It must be
.

daily

earned

for operation this
year and

that

the days to

System companies continue

and

flower

cut

refreshed—else like
from

its

life-giving

roots, it will wither and die.
"We

fight

battle—we

Gas and Electric
and its

Operating Affiliates

Appalachian Electric Power Company
Light & Power Company

Cehtral Ohio
Indiana &

Michigan Electric Company

Kingsport Utilities, Incorporated
The Ohio Power
Company
Wheeling Electric Company

Kentucky and West Virgina Power Company, Inc.

the

the
no

our

own

those things

are

of God.

eyes

serving

only

defending for all
things that allow

personal dignity
that each believe

lift

Company

not

are

those

mankind

dH American

(1)

important

opportunity

for

are

pre¬

men

their hearts and minds to
highest place—there must be
stragglers in such a conflict.
up

"The
—it

road

ahead

certain

may

long
by

marked

critical and difficult
passages. But
we march
together, endure to¬

gether,
succeed.

share
.

together,

shall

They must offer "deferred
Today's tax rates make

income."

it worthwhile to accept lower cur¬
rent
income on invested capital

order

obtain

(2) They must possess inherent
capacity for capital growth over
the

years

ahead.

(3) They must provide relative
safety of principal because heavy
taxes

make

cult to

The

Three

Then David

important
times

free

society tomorrow.

Babson

that

become associated with The Rob¬

Stocks

makes this

observation.

think

some¬

many

inson-Humphrey Company, Inc.,
Rhodes-Haverty Building, as VicePresident

the

in department.

the

municipal bond

Mr. Joliey was for¬

security business often fail to
realize the validity of the follow¬

merly
Space

ing statement, and also to impress
it upon our clients.)
Quote: "Our

urer

observation is that most

Traders Association.

are

investing

ment

human

that

beings,
Income

not

who

have,
-

officer of Johnson, Lane,
Co., Inc.
For the past
two years he has served as Treas¬
an

the

National

Security

retire¬

seem

securities,

characteristics."

(1)

men

for

capital

purposes

understand

Correction

different

the "Financial

June

,-a

Stocks—Stocks

6th

Theodore

opened his

companies

was

Chronicle" of

reported

that

Gruellemeyer

had
offices to engage

own

in
stable
industries,
in the securities business. We are
food, tobacco, utility and
informed that this was in error as
bank, where sales and/or earnings
Mr.
Gruellemeyer has not sev¬
are
relatively steady but static.
ered his connection with
Glidden,
Example: American Telephone.
such

Morris

(2)

Cyclical

Stocks—Stocks

Co.

companies operating in highly vol¬
atile

industries

steel,

railroad

and

brass,

such

heavy

equipment,

copper

where

the

volume

business and/or earnings fluctuate

through

extreme

the peak of the
the

range

ple: American Car and
(3)

Growth

from

business cycle to

depths of depression.

Exam¬

Foundry.

Stocks—Stocks

companies engaged in dynamic in¬

gas,

assurance

Joliey

ATLANTA, Ga.—Lex Joliey has

Major Types of

Common

dustries, such

Lex

capital.
4

there

increasingly diffi¬
lost

recover

By our. example today of better
performance under free enterprise
will

greater future

income.

to be misdirected dur¬

awareness

AGE

follows:

judgment to be obscured and

ing this great period in the his¬
tory of our industry.

kilowatts...

Robinson-Humphrey

investments

our

will

enterprise, and without

our

Joliey V.-P. of

must meet to qualify for estatebuilding at today's levels of taxes
and living costs."
These are as

excellence

and

interests

free

if
in

unflagging

(and there is

the interests

Million

Gov¬

employees

Federal

ernments and with the public gen¬

erally.

without

were

and

Lex

MAINTAIN ACTIVE MARKETS IN

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UTANA BASINS OIL

ENGLISH OIL
Information

chemical, natural

electronics where

earnings and dividends

are

sales,
in

request

W. D. Nebeker & Go.
f

Members

PAC.

and

SALT

NAT'L

LAKE

A. S.

LIFE

CITY

Phone

BLDG.

10. UTAH

9-3783

Volume 177
'

■

•

available

Electric

the

Indnstiy Should Lead
In Improving Public Relations

21st

Annual^ Convention

Edison

Oakes,
d e

Institute, in At¬
N. J., on June 3,

City,

Charles

"I venture to say
reasons

'salesmanship

forcefully

Com¬

pany

tion

Al-

directing

good will

after

ing about

Pa.,
noting

standing of

unfa¬

vorable
litical
for

their

owner

propitious

for the electric power
industry to
take the lead in restoring and im¬

solid American

proving public relations of busi¬

many

ness

"What

concerns.

In presenting this aspect of his
subject, Mr. Oakes stated:

-I

"In

the

electric

still

are

But here

face

citing frontier
human

and

the

and

was

ex¬

frontier of

problems

those human

have

wholly

busi¬

material

nation and

common
can agree

First

was

with
that

rector

salesmen

under

Chronicle)

Davis

now

had about 700 Renyx, Field &

Gerald
affiliated with

NEW ORLEANS, La.

Corp.

Investors

sales he

Field

Joins Renyx,

(Special to The Financial

Vice-Presi¬

—

Co., Inc. of New

guidance. York.

his

HERE'S

took

war

EXAMPLE

years

industry's

and objectives and

"More

all

particularly,

ac¬

of the

war-time

short¬

manpower

had brought about fewer and

ages

alk

opportunities

meet

fotmWjb

anc

Restrictions

customers.

"
°

and the

use

had

rationing of mate¬

forced

lowering

service standards and of the read¬

iness

beings

needs

relationships

East

where until his resignation as di¬

problems, we, as an
we

difficult to maintain

equipment and

thing". It primarily involves human
human

dent

offices

New York.

Benedick

Mr.

The new firm

with

some

benefits
accruing
to
healthy business state.

rials

not

as a

maintain

42nd Street,

these human

close parallel in

principles.

understanding

beginning to realize that

will

Exchange.

the investment media for

made it

fewer

and

public

personal planning."

successfully those personal rela¬
tionships so essential to proper

as others, yet just as real
certainly filled with oppor¬
tunity.
More and more we. are

and

rity firms. Prior thereto he was a
senior partner of Lewisohn & Co.,
members of the New York Stock

of the concept

employee

and

.ovpr

understand¬

frontier perhaps not as
defined nor as carefully

use

institutions and professional secu¬

■

tivities

charted

ness

are

'personal financial planning' as
major approach in using mutual

funds

struggle for men's minds.
"It seems to me, too, that there

the
problems so
faced? At the outset
apparent that the respon¬

us.

and

new

—

relations

ing —
clearly

business

our

opening before

individual

the final analysis,
somehow come to this if
to be successful in this

must

senior

Co., a firm which he organized
provide research services to

the formation of Inves¬

velopment and

in the New York Stock
Exchange firm of Kalb, Voorhis

partner

were

challenge of ever-widen¬

ing frontiers in

'they

enough,

dustry's top producers.
Mr. Kalb has resigned

Planning Corp., "which will
devote itself primarily to the de¬

Yet, in

sibilities and arduous tasks thrust
had

industry

have long been accustomed to the

constant

intimate

the opportunity to emphasize the
interest of everyone in holding to

Charles E. Oakes

brought into the industry sev¬
thousand salesmen, many of
whom today are among the in¬
eral

tors

We have not

individuals.

under¬

relations

community,

and

out

and

broad program of re¬

on a

customer,

time

John Kalb and Walter Benedick

countries as a na¬
rather than to reach

our

establishing

industry,

present
is

embark

po¬

climate

pointed

other

industry, have
American system. others. I think
"Just a few years ago a number
of companies saw the necessity to1

have

been two dec¬
ades

basis.

toward bring¬

better public

those

Kalb, Benedick Form
Investors Planning

been able to direct our efforts on

atten¬

improving

well

that one of the
so poorly

largely been trying to
of the peo¬

very

them

realize that

their

possible

During the 20 years he has been
in the fund business he trained

want to hear our story."

have fared

tional group

pro¬

can

toward

lentown,
there

confidence

use

announce

We should all make greater
their
abilities
by more

ness.

and

conclude that it is essential to get

influence the thinking

improve public
relations,' we are not realizing
their full potential constructive-

Pennsylvania

Light

have

revenue

there is ample evidence for us to

the

thus far in the cold war is that we

look to them

ducers but unless

the

Power

True

load builders and

Presi-

public has

and respect.

the

Electric

lantic

the

whom

companies

ideas

tried

heretofore.

ple

instructive address at the

public relations field at the local
to
a
greater extent than

Pennsylvania Power & Light
Co., holds present is propitious time for gaining better public
attitude through greater, more effective sales organizations.
an

member

details

level

Charles E. Oakes, President of

' '■

(2543)

Chronicle

Number 5228... The Commercial and Financial

which

with
could

the

met.

customers'

Availability

and this is

and

electric

■limunity had become a matter
of first importance in the expan¬

particularly true of the
industry in which the idea
service to the people is para¬

mount.

electric

take the

mative

sion

''V

"The

utilities

should

lead in this great infor¬
task for probably in no

location

Many
the

war

the

interests

enterprise

ciation

sive.

for

want

better

self-expres¬
The property of the company
more

It is

customer.

his

and

And

the

employees

work-r-^those

personally
company

buy

many

and

for service in

him.

many cases,

receives

Furthermore, in
share owner, he

return

his invested

to provide

his and others' service.

erally he does not
it

does,

gen¬

this clearly

see

the

system,

bone

But

pointed out and as he
economic system, the

the

profit
erty

money

turn flowing

savings—savings used

until

The

cases.

the

sees

which

America

private
is the

however,

obscured

this

ideas

and

have

today

other

become

there

great need to restore them to their

place.
Words in them¬
however convincing they
be, are not the answer. The

rightful
selves,
may

words

need

interpreted by

countless specific acts.

"And it

seems

that

v/e

the electric industry are peculiar¬

ly equipped
local

to undertake at
this

level

demonstration
in

public

essential
and

task

have in

BETTER

our

say

com¬

panies highly trained sales people

engaged in meeting vast numbers
of the public every day and in

new

role

Formbrite, Anaconda's

drawing brass that

proper appre¬

vital

of doorknob made

helps polish itself.

each

BRASS

an es¬
many

under the Holding Com¬

corrpanv

Act.

pany

for

contacts

the cultivation
on

good

was

time.

of human
I shouH

broad scale.

industry-wide a great
accomplished in a short

that

say

seemed clearly

situation

The

call

Yet, while the electric

in¬

dustry's extensive efforts pitched
on

basis

national

proved

pro-

Formbrite*,

superior drawing brass, recently intro¬

ductive^ they served to accentuate
the over-reaching importance of

duced

bringing our story into the home

Company, supplies the answer to a

in intimate fashion."

the

Four Points

where

Four

us.

"First—The

this lead

most effective pro¬

takes place at the field
community level.

company

"Se-ond—The
sales

activities

organization

erful

means

relations

rn!y

duties

"ford

the

costs more

public

efficiently,

slight enlargement of the
of

sales

personnel

dertaken without

their lead

can

with

vides

all

un¬

superfine grain frequently permits savings up to

50%

or more

in finishing costs. In some cases only a

simple "color buffing" is all that is needed.
sold

at no

mental

increase in

stage.

price, is

Formbrite is
in

now

Formbrite,

well past the experi¬

result of Anaconda's constant

metallurgical research and product

the poten¬

aid

such

ects

program

plant already producing additional copper
an

in Chile

plant to be built in Montana!
extensive modernization in the mills ofj

aluminum reduction

...

well

The American Brass

Anaconda is
of

Anaconda's

of improvement, modernization
expansion of existing facilities at its mines, mills'
fabricating plants. This includes new mining jproj-j
in the United States and an immense new sulphide)

company-wide

Company. Through this program.

contributing significantly to the vital

providing more metals and better metal

job

products^

•Reg. U. 5. Pot.

Millions of pounds have been made,

09.)

Anaconda W/re 4 Cable Company
a

copy of

the

new

and

interesting Publication B-39
on

Formbrite Sheet, Strip and

AnacondA

Andes Copper

Mining Company

Chile Copper Company
Greene Cananea

Copper Company

Anaconda Aluminum Company

Anaconda Sales Company

through the Edison Electric Insti¬
collect

For

Wire write to The American

not overlooked.

should

development^

Reflecting the same progressive spirit is

and

work'

The American Brass Company

"Fcv.rtv—The electric industry
tute

superior to ordinary drawing brass.

successfully fabricated by a wide range

building efforts.

regions programs and
value

exceptionally fine grain structure which pro¬

and

manufacturers.

detracting from

kept fully informed of public

tial

The

Company developed Formbrite, a metal

surface far

sold

and

than the metal itself.

This

"Third—Sales personnel should

work

sometimes

help its customers overcome this problem,

American Brass

pow¬

reaching

objectives

that is needed ard this

drawn products, very often the most

points stand out:

motional work for the individual

stamped

expensive operation is the finishing, which

all

does

Brass
pressing problem in

by Anaconda's subsidiary, The American

metalworking industry. In the fabrication of count¬

less

the

improvement

understanding.

this because

the

less

importance of protecting the
rights of the people to own prop¬
erty as basic to liberty. In recent
fundamental

prop¬

clearly

very

well

back¬

becomes

saw

One type

these

cases

the

years,

"Now

"The founders

ANACONDA'S

over

importance of the customers

played in the furnishing of
sential public service.
In

puzzling.
.

lost,

ing from divestment from a parent

knows

itself and its employees
of their needs from his

pays

had

anc

concerns.

it;

see

and

sees

firm

back

can

who

new

the

there, right where

neighbors

the

problems were com¬
pounded
by
the imposition
of
severe
financial problems result¬

has been built solely to serve the
he

their sensitivity tc

years,

other business does the American

become

employees

industrial system that we call free

term,

service

plans of local industries

the

adequacy

and

make

Brass

Company, General Offices,
Water bury

20, Conn.

COPPER MINING COMPANY

International Smelting

Refining Company

and

53273®

The Commercial and Financial Chronicle

(2544)

but, together with his other meas¬
ures, it provided France with a
period of much-needed respite,

France's Devaluation Dilemma

the

By PAUL EINZIG

the recent collapse of the French Cabinet, Dr.

country at the present
The alternative would

that

decline

war.

respite is badly needed

moment.

Einzig looks for another devaluation of the French franc, but
adds the solution provided by this move is essentially a tempo¬
rary one. Holds France should be given substantial external
aid to inspire confidence in her currency and to uphold her

of the

eve

Such

Commenting

.Thursday, June 11, 1953

the

gold reserve

Seaboard Air Line

through continued trade deficits
and through the evasion of ex¬
The

stock market has been a Moreover, the stock was selling at
change controls by those who
anticipate a devaluation; curtail¬ rather tempestuous affair in re¬ only about 5l/z times 1952 earnings
cent weeks.
There is ample evi¬ of $20.16 a share and it is widely
ment of essential imports of raw
to unemploy¬ dence that investors and specula¬ estimated that 1953 results will
All these difficulties are over¬ materials leading
Eng.—With the de¬
tors alike are in a highly nervous be even better.
During the first
Government
of
M. shadowed, however, by the ef¬ ment; a weakening of the defenses
the recurring rumors four months of the current year
in Indo-China and in France it¬ state and
France was plunged fects of the gross over-valuation
the transportation ratio continued
as to the probable outcome of the
of the franc.
The French Gov¬ self through enforced economies
one of her all-tooon
the downtrend and, even
which
followed
each on arms expenditure, and a gen¬ new truce negotiations in Korea
frequent
po¬ ernments
recent years eral loss of prestige and demor¬ have injected a new note of un¬ though maintenance outlays were
litical
crises. other in office in
a
As usual the made
praiseworthy effort to alization through the evident fi¬ certainty into the picture. Talk higher, common share earnings
of important cutbacks in military climbed to $8.26 compared with
cause
of
the avoid
yet
another devaluation. nancial weakness and instability
crisis was fi¬ They doubtless realized the need of the country. M. Reynaud was production regardless of whether $7.67 a year earlier. With the traf¬

importance in Western scheme of defense.

LONDON,
feat

the

Rene

Mayer,
in May into

wrong
in referring to
the basis of past not far
they
assumed
that France as "the sick man of Eu¬
was
defeated any such action would only bring rope."
A devaluation would facilitate
because, in the temporary relief as the domestic
interest of price
level
would
soon
adjust French exports and would stimu¬
putting the itself to the lower international late tourist traffic. It would re¬
country on a value of the currency. For this verse the outflow of capital and
sound
finan¬ reason pressure in favor of de¬ would strengthen the gold reserve.
cial
basis, it valuation has been resisted, even It would enable industries to
attempted t o though it is evident that on the concede some wage increases and
introduce basis of the present official ex¬ thereby to avoid some threaten¬
Dr. Paul Einzig
drastic meas¬ change rates, France is a very ing
major
wage
disputes.
It
,'S
ures
which expensive country. The over-val¬ would
give the Government a
were found unacceptable
uation of the franc gravely handi¬ chance to prepare the necessary
by the
majority of the members of the caps French export trade and measures to strengthen the fi¬
French Chamber.
This situation tendsi
to
divert foreign
tourist nancial front without having to
arose again and
again since the traffic to other countries. As a make unduly heavy sacrifices in

nancial.

The

Government

«od

the

war.

arose

for

it.

But

result

fre¬

experience

both

the

ments and internal

^again during

tent

iculties

the

financial

the

financial

'30's.

troubles

diff¬

Evidently,
France

the adverse

aid

France's

The tend¬

American

re¬

aid.

And

the

indebtedness

European

circle.

pay¬

Euro¬

is, however, towards

ency

that there

vicious

the

Payments Union.

pean

extremely difficult,
complete

ex¬

Ameri¬
running up

the

and

duction

some

balance of

indebtedness

litical stability in turn makes
the
solution of the financial
problem

Payments

Union
has
level at which any new

Admittedly, France has many
other troubles besides her finan<:dal problems.
An

reached

proportion of her industrial pop¬
ulation are
Communists, and con>sequently strikes of a political
^character are a
frequent occur¬

permitted to wonder whether the

unduly

The

rence.

♦stir

aim

wage

increase

deficit has
In

large

obviously

demands
the

maintaining
franc.

office

settled

another

circumstances

recently
in

ance

Governments

advised

held

been

well

stubborn

devaluation.

resist¬

favor

pressure

which

have

their

gold.

one

There

of
can

be little doubt

had M. Paul Reysucceeded
in
forming a

naud

the
value
of
the
This method is practiced

also in other

the

French

order

difficulties

munist

'30s when he constantly criticized
the
inadequacy of devaluations

pressure

proving excessive
source
war

favor

ap¬

remark

"too

became

one

words

expenses impose a burden on
French Budget which would
^constitute a major problem even

late
of

too

and

by¬
period.
When
became
Finance

he
difficult
circumstances. eventually
is, together with the re¬ Minister shortly before
he devalued the franc
quirements
of
rearmament
in
with

the

extent

that

little"

the historical

that

less

■(connection

the

"'She

de¬

was

claims.
trouble for reluctantly undertaken by various
Finance
Ministers.
His
in Indo-China. French

wage

jtts

nec¬

to add that the solution
provided by yet another devalua¬
essary

tion

one.

But

essentially
then

temporary

there

French

saying according to which it is
only temporary things that last.
There is always a chance that the

respite may
was

after

franc

long

one

the

devaluation

Poincare

1926.

Simultaneously with the devalua¬
tion France should be given sub¬
stantial external financial aid in
order

inspire

more,

the

war

became

such

successful,

changing
to

the

negotiations are fic outlook still favorable and in¬
the constantly dications of a continuing trend
greater
operating
effi¬
prospects with respect toward
truce

and

confidence

Profits

Excess

have

Tax

?kS0, c?.ntribu*ed importantly to
the
reeling of uneasiness. Railroad
securities, of course, have not been
these

immune

pressures

even

though most of them

are

at least

not

tax

At¬

other

tribute

countries

their

should

Railroad

the

have

stocks

Bridgeport power station lo-;
cated near Eddyville is now
nearing
completion. The system's generating
capability is increased from 32,303 KW
to 76,300 KW. This
keeps pace with the
system

demand,

135% in 10

years.

which" lias

increased

Southern Iowa's elec¬

trical future is bright.

Day & Co. to

that

true

appears

conservative.

Drive in Baltimore

rails

have

the rails have generally

recoveries

assumed

railroad

mously
this

leadership. Students of
securities pretty unani¬
are of the opinion that
no

far

than

proper.
It is pointed

the

right

and

out that earnings
current

been running
estimates and
some

have

year

well above earlier
that

months to

ified
ar®

least

Joseph W. Sener

for

come

somewhat,

traffic

analysts

.°.f the opinion that there is

sufficient

President

Baltimore.

the

Bond

Club

Baltimore

The

Secu¬

resiliency in

our

economy to take up

extras

the year.

Some

Admit D. D. Hall

partnership.

Mr. Hall is

for

the

railroads

managements

have

income

taxes

municipal department

office, 14

Jones, Cosgrove Branch

Coast

Highway, under the direc¬

tion of Chester W.

Boxley.

25%

Financial

Chronicle)

DENVER, Colo. —James W.
Hackworth has become

affiliated

rado

Building.

(Special to The Financial Chronicle)

Last

staff
pany,

Bank

Allison-Williams

Northwestern

Building.

Com¬

National
J:..

week

announced.

road
this
the

has
con¬

long-

Subject

ICC and stockholder approval the

split will be 2V2 for 1 instead of
*

for 1

that had been expected in

most

quarters. At the
the quarterly dividend
was

Co.,

York

members

Stock

has been elected Chairman of the
Board of Standard Gas & Electric

Co., to replace Edward O. Boshell,
who has resigned his
office as
Chairman.

same
on

time,

the old

Henry P. Erwin
Henry Parsons Erwin, a direc¬
tor of the Riggs National Bank,
Washington, D. C.. passed - away
at the
ness.
a

of 71 after

age
Mr.

Erwin

member

Stock

Exchange,

ciated

with

the

past

wa3

Washington

and

long ill¬

the

was

old firm

asso¬

John

L. Edwards & Co.

raised from $1.50 to $2.

This is at the rate of $3.20 a share

annually

the split stock.

The stock had advanced sharply
to new

highs for the

year

imme¬

diately prior to announcement of
the

split and increase in the divi¬
dend.
Immediately following the
announcement, with a combination
of profit taking and the general

Specialists in

Guaranteed
Railroad

Securities

market weakness, the stock had a
sizable reaction. While the decline

have had

psychological
rail analysts
viewed this as an opportunity to
generate new buying interest. By
may

the

end

some

many

the

week

Exchange,

an-

split-up of Seaboard Air

was

Levy &

New

each quarter of the year.

awaited
Line

the

instead of

at least one
not been influenced by

MINNEAPOLIS, Minn.—Horace justification,
N. Gibson has been added to the

March 15 and

June

However,

stock

Joins J. W. Hicks Co.
(Special to The

Robert J. Levy, partner of Rob¬
ert

railroad

man¬

COMPANY

Centerville, Iowa
V ft *.,"•}

1953.

v°lui?e has not been heavy.
While

later

With Allison-Williams

Utilities

year

the newly-in¬

rate

participated in the declines, it is
also true that in the subsquent

con¬

with J. W. Hicks & Co.,
Inc., Colo¬

I owa boutliern

even

Sener Heads Fund

given

security markets.
these declines have ap¬
parently reflected a drying up of
buying interest rather than any
great selling pressure. Most of the

NEWPORT BEACH, Calif. —
Jones, Cosgrove & Miller have
opened a branch office at
535

new

basis

dividend

•Largely

sideration.

The

quite

actenzed recent

and/or

R. L.

in the firm's New York
Wall Street.

Iowa

this

ground fairly easily in the peri¬
odic selling waves that have char-

ian

Denton D. Hall

Southern

creased

Traders
Association,
and
civil¬ rity
the
National
Security
Traders
the slack
gesture
Association; he was also formerly
and prevent any serious decline
of solidarity.
A consolidation of
Chairman
of
the
Southeastern
in freight tonnage.
It now appears
France's
debt to
the
European
Group of the Investment Bankers
Payments Union would in itself reasonably safe to predict that for
1953 as a whole railroad earnings Association of America.
go a long way towards improv¬
will top the most satisfactory 1952
ing her prospects. Such improve¬
level.
Such a prospect, in turn,
ment would pave the
way towards
Robt. Levy Chairman of
strongly indicates the likelihood
much-needed political stability.
of quite a few dividend increases
Standard Gas & Electric
and

ager of the

With

share for the full

$22

obvi¬

now seems reasonable
for earnings of at least

look

BALTIMORE, Md. —Joseph W.
comparisons
in the franc at its new level. The
with a year ago are almost cer¬ Sener, partner in John C. Legg &
role of France
in
the Western
tain to be highly favorable. Fears Company, has been named Gen¬
scheme of defense is one of firsteral Chairman of the joint Com¬
or a let-down in business as early
rate importance.
It is essential
munity Chest drive and United
as
the final quarter are abating
therefore that she should be given
and even if there is peace in Ko¬ Defense Fund, which will begin
effective
aid
in
her
hour
of
in October.
Mr. Sener is a Past
rea and the arms program is mod¬
crisis.

•

versy.

apparently
been deterred
lantic Defense
there¬
from raising dividends in the first
System, it greatly ously under-valued and
increases
the
fore easily defensible.
half of the year by the heavy cash
difficulties of
a
This act
R. L. Day & Co., members of the
French Government.
drain imposed by the necessity for
did not provide a final solution New York
Stock Exchange,
on
paying 35% of last year's Federal
July 1st will admit
North

ciency,

contro¬

affected

the

Although no country is in
as good
a position as the United
European countries. Mayer's resignation, his first step States to grant assistance, Britain
would have
been a drastic
valuation of the franc. This
M. Reynaud's policy
during

Another

of national defense.

Having said all this it is

Government following on M. Rene

Even where Trade Unions are not
tinder
Communist control
they
find it difficult to resist
Com¬

France is the

the sphere

are

ments has been offset by
of

po¬

pay¬

prosperity

adversely affected.

can

are

sapt to be the major cause of po¬
litical instability.
Lack of

balance

quent intervals during the finan-nial difficulties of the
'20's, and

the

not

the

\yere selling to.yield a liberal 7%
on the basis of the new dividend.

25 Broad Street

New York 4, N.

Telephone BOwling

Green'9-G400

Members Nafl Assn. Securities Dealers, Inc.

Number 5228... The Commercial and Financial Chronicle

Volume 177

say

Continued from jirst page

signifying nothing—except an effort of politically minded
people who want to "get on record" in case.
These clashes of arms,

variety

stances
••

—

basic facts which

are

not

much

evidence

the

dis¬

patches which come in wholesale numbers from the na¬
tional capital. Let us never lose sight of the circumstance
that many of the measures about which there is now so
much controversy are preliminary in basic nature. That is
to say, they are designed to tide us over until it has been
possible to make a thorough restudy, reappraisal and re¬
vamping of our national policies.
Tax Reform

Take for

example this business of

six-month exten¬

sion of the corporate Excess Profits Tax. The President
has quite specifically said that the purpose of this plan is
;

give time to do a workmanlike job on our whole system
Obviously, such an overhauling could not be
achieved in a day, or even a few weeks. If adequate plans

of taxation.
;

be laid for it in time for really constructive work

can

;

next year,

The

the achievement will be

early

no mean one.

to be the

case

ter,

discussion. Let
time

come

also with influential

men

Ex-Presidents

postponement of action. Other illustrations could doubtless
be found and cited, but enough has been said to make it
clear that the Eisenhower Administration is, in a sense,

Low

some

and

Cup

for

Foui^-

Lewis

Bear,

Gross—Sam

Low,

both

Stearns & Co., 74.
Candee Cup for foursome Low
Net—John D. Cronin Jr., Shear-

Hammill & Co. and R. Donaidl
Gibson, Hirsch & Co., 100—35—(Ki.
Christie Cup for Match Play
Against Par—Hosea
C.
Bailout

son,

Shearson, Hammill & Co., and Ed¬
ward H. Robinson, Schwabacher
& Co.

Marvin Levy, Lehman Brother^
Gilbert
Wehmann,
White,
Co., defeated Enos Curtint,
Graham Paige Co., and Samuel
O'Day, Northern Trust Co., by ttte
score of 10—8,
2—1 (default) in

■„

and

Weld &

giving the new regime

the

let us be adamant that it act
wisely and vigorously in the end.

tennis

matches.

/■

Special awards were won by
Henry March, Ladenburg, Thaimann
& Co.; Thomas F. Staley,
Reynolds & Co.; A. Glen Acheson,

Duryea

Bache

& Co.; Wickliffe Shreve,
Hayden, Stone & Co.; John Jm
Nolan,
G.
H.
Walker
&
Co.;
George D. Woods, First Boston
Corp.

Wright Duryea, of Glore, Forgan & Co., was elected President
of The Bond Club of New York for the coming year, to succeed

Joseph A. W. Iglehart, W. E. Hutton & Co., who was President
during the past year. The election took place on June 5 at the

at the other end

subject. Again the program proposed is at bottom one of

new

gov¬

Winners in the golf tournaments

With Paine, Webber

Pennsylvania Avenue—and wishes time for his new
staffs to restudy the situation and arrive at independent
conclusions of their own.
Meanwhile, apparently more
funds than the Air Force can spend in the interim are
already available from unspent appropriations of the past.

•

were:

Obviously the proposal to renew the Reciprocal Trade
Arrangements Act for another year is of the same stripe.
It may be that the President is in this case somewhat more
fully prepared with ideas as to precisely what ought to be
done, or he may not be, but the fact is evident that influenfial members of Congress are in need of considerable edu¬
cation or coaxing if they are to come fully over to the
ideas which the White House is supposed to have on the

board

Dickson & Co.

way;

New York Bond Club Elects W.

the

Lawrence Bogert, Jr.,
Eastman, Dillon & Co., Hudsoa
R. Lemkau of Morgan Stanley &
Co., and Edgard J. Loftus of R. SL

.....

be reasonable in

ernors—H.

many

get under

was

elected Treasurer.

members

other issues of similarly basic nature
—the iniquitous Securities Acts, for example—but these
are the ones which are involved in matters
currently under
are

Weeks

The club also elected three

general is to be said of the much publi¬
cized reduction in Air Force appropriations. The Presi¬
dent, himself an authority in military matters, has a new
set of military advisers coming into office within a few
weeks. He is evidently not wholly satisfied with the views
and appraisals of the old Chiefs of Staff—as is well known
same

There

./■

Mr.

Secretary and Dean Wit¬
Jr., of Dean Witter & Col

was

grips with this idea of soaking the rich upon all occasions
when it undertakes to redesign our tax structure, it will
miss a great opportunity and, we venture to say, lose
much of the standing it now has with a good many in the
community. We can only express the earnest hope that
the Administration when it gets down to reshaping our
foreign trade policy will be able to formulate and obtain
support for a program far more realistically based than
any that the Republican party has sponsored in modern
times and any that has found real support from the New
Deal or the Fair Deal. What is taking place now appears
to be more a postponing of these real tests than anything
else. They must not be evaded when the time for them is
•_

Hornblower

succeed

If the Eisenhower Administration does not

here.

Ralph

elected

of themselves.

care

Hornblower, Jr.,

Quit Soaking the Rich!

whether of the Pickwickian

not, are of interest. In fact, in different circum¬
they would be definitely diverting and even amusing. The thoughtful observer must not — and probably
will not
permit it to divert his attention from certain

taken-the trouble to take

Duryea.

compel the rich to take
care of the unfortunate, the
improvident, and the incom¬
petent—to take care of them in a way that they have
never

Vice-President

from time to time, particularly about ways and means
financing these hand-outs, and it will soon become

evident that the basic idea is to

We See

*.As

(2545)

(Special

to The Financial Chronicle)

HARTFORD, Conn.—Edward T.
Carr

has been

the

added to

stafC

of Paine,

Webber, Jackson & Cur¬
tis, 111 Pearl Street.

L. P.

Kilgore & Son Opens

JACKSONVILLE, Fla. — L. F.
Kilgore & Son is engaging in a
securities
Duval

business

Street.

from

Partners

West

are

Harrison Haverbeck
H.

Wright Duryea

Macdonald

Hornblower, Jr.

Harrison M. Haverbeck, partner
Club's

annual

meeting, which
Day.
'

was

Ranald H.

Macdonald

in Harvey Fisk & Sons, New York
City, passed away June 5th at the
age of 65.

held in connection with the

Bond Club Field

of Dominick

Dominick

elected

was

...

along, and is not fully prepared as yet to
global plans. In all fairness, it
would appear to us, it is entitled to a reasonable time
to work out its ideas and to convert its party to them—so
feeling its

far

way

forward

come

with its

conversion is necessary.

But from the

longer view, the most important fact to

from all this is that the real test not only of party
strength and party solidarity, but of statesmanship of both
the Administration and of the entire party, will come some

emerge

months

hence, probably soon after the turn of the year.

Take the matter of taxation. The Administration and the

Republican party, if they are to show themselves really
equal to their opportunities, must face such issues as that
involved in the wholly undesirable Excess Profits Tax, or
the rate at which individuals generally are to be taxed,
^ and the other more detailed questions which seem to be
7

absorbing the attention of the rank and file today. But
these are only parts of vastly more important considera¬
tions which must not be allowed to go by the board when
the

question of a full overhauling of our tax structure

to the fore.

long under the spell of New Deal and
Deal semi-socialism that we are in danger of for¬

We have been
Fair

getting some basic and vital Americanisms. One might al¬
most epitomize New Deal and Fair Deal fiscal philosophy
in the words: "Soak the Rich and Spend the Proceeds

In tax matters this concept of statesmanship
the form mainly of income taxation so "progressive"
be all but confiscatory in the higher brackets. This

Lavishly."
takes
as

76,090 Partners aren't etwqh I

£m

In the past seven years,

through much of the program
Dealers and Fair Dealers—runs through it in

so we

our

Partly

our

possible

professionally. Study what the
social security movement have to

goal is

now may

goal is someday to have
home-town

leaders in the so-called

And

Already, three out of four of
shareowners

eagerly

ever-increasing
Actually, im¬

sound,
every

Then truly

industry in

our

full

our

these, currently, two out of three are
Here

customers.

are

real benchmarks of

progress.

Within the framework of such

new name on

bit

live in Pennsylvania.

home-town interest

increasing

number of shareowners.

attention of all but those who follow

seek.

always did.

of the ..New

to escape the

look forward to each

partner, too.

way

goal

stockholder list every

as we

But this

amazing 76,090.

is still far from the

& Light

Company shareowners has risen from

basic idea, moreover, runs

such matters more or less

alone, the

number of Pennsylvania Power

36,998 to
Too Much New Deal

Kilgore, Sr. and L. P. Kilgore, Jr.

vestors,

lies

utility's

numbers

reflected in

local

in¬

the business-managed

greatest

opportunity

for

positive public relations.. .and for

customer

the

would be

with

subsequent growth that comes
public confidence.

■

every way.

l^Miisyly3«i3

->8Liqkt Company
rmoV

The Commercial and Financial Chronicle

(2546)

...

Thursday, June 11, 1953

from

page

' '

■'

■...<•

Continued

until after the date of the transfer
of the assets to the
corporation in

Bank and Insurance Stocks
By

exchange

Infezesliitg Tax Rulings
And if he again took advan¬

Bank Stocks

—

having his wife join in the gift tax

interesting report entitled "The Case For Bank Stocks—
1953" was recently published by Kidder, Peabody & Co., 17 Wall
Street, New York, N. Y.
;
This is the 1953 edition of a similar study on bank stocks made

time, the use of trusts
gifts, including the $3,000
gifts, was very popular.

one

to make

pertinent facts are presented on 28 of the major financial institu¬
tions throughout the country, including 14 in New York and 14 in

most

annual

principal cities.
of the Kidder, Peabody report is April, 1953. Al¬
though there have been a few changes in the data presented since
that time, the fundamental factors still apply and the opinions are
still believed valid.
Therefore, we present the highlights taken
from the report summarizing the position of bank stocks.

gifts

hence do

this

and the higher interest rates indicate

subject;

it may be

higher at Dec. 31, 1952 than for any

The

would

first

previous year-end. The interest rates earned on loans and invest¬
upward last year, and reached their highest point
in December. Hence, earnings from loans and investments in the

distributed to

current year

accumulation

each

should be above 1952, even if there are no further
increases in loan volume or investments, or in interest rates. The
gain in income due to these factors should more than offset any
increase in expenses and taxes.
"Present dividend rates appear secure.
Last year, 12 of the
28 banks included in this report increased their dividend payments.
In spite of the increases in disbursements, current dividends for

any

stated

book values do not include substantial

reserves

which

ment.
be

been

appeal in

corpus

can

opinions

and

supported

be seen,

are

Darling Director
J.

Darling,

Jackson

been elected

director of General

Telephone Corp. of Pennsylvania,
of the major units of the Gen¬

York

exchanges,
W.

ciated

York

With F. I. du Pont Co.
to

The

Financial

Chronicle)

LOS ANGELES, Calif.—Edward
K. Roberts has joined the staff of
I.

Pont

with

Madison

Telephone system.

Francis

Co.,

677

South Figueroa Street.

can

the
ave¬

is open under present law to

eliminate
taxes

gift

substantial

and

taxes

three

for

estate

generations

portion

has

that

Agreement
A

well

Not

known

ment

them

Avenue

person's

office

best

Compete

business

described

competing

at least defer for

of time.
self

which

deductible

New

or,

not

Paine, Webber Brch.

ASHLAND, Wis.—Paine, Web¬
ber, Jackson & Curtis has opened
a

branch office at 212 Second

West under the direction
G.

St.,

treated

NATIONAL BANK

and

of INDIA, LIMITED
Bankers

the

Government

Officer

26,

Bishopsgate,

;

London, E. C. 2

New

Members

American

York

Stock
Stock

Exchange
Exchange

120 BROADWAY, NEW YORK 5,

N. Y.

in India,
Pakistan, Ceylon,
Burma, Aden, Kenya, Tanganyika,
Uganda, Zanzibar, and Somali-

land

Reserve

Telephone: BArclay 7-3500

Teletype—NY 1-1248-49

(L. A. Glbbs, Manager Trading Dept.)

Specialists in Bank Stocks

Protectorate.

Authorised Capital-.

Paid-up

banking

£4,562,500
£2,281,250
£3,675,000

Capital
Fund

The Bank conducts

and

every

the

trie

cor¬

insolvent

and

the tax deficiency.

excessive

liable

the

tax

defi¬

then

employee

claim for refund.

had

and

corporation's

The

became

payment

transferee

filed

The

Commis¬

description of

exchange

business.

Trusteeships and Executorships
also undertaken

the
as

the

then
be

corporation

pre-existing tax lia¬
the

government

creditor

Tax

Free

Transfer

the

cor¬

Will

Not

Net Oper¬

Corporation to Another
"When

business

state to

one

from

moves

another, sometimes it

becomes

advisable to change the
incorporation of the com¬
pany.
Thus, for example, if a
business
incorporated
in
New

state of

York for years had its
plant in
Long Island City, New York, and
then moved the plant and offices
to Trenton, New
Jersey, it might

that it would be practical to

seem

tion,

the

excessive compensa¬

transferee, I
the

being

really a trustee
compensation

was

received."
The

The

tax

the

for

reason

obvious.

dispute

taxpayer

rate

was

bracket

thereon

annum.

However,

the

per

Supreme

against the

held

taxpayer,

compensation

under

claim

have to pay it back was not

expense;

went

expendi¬

the

arisen.

rate

of right. He had the right to use it.
The question of whether he might
ever

This

general rule, it may
that amounts paid for
not

compete

expenditures

be amortized

ratably

of the agreement.

which
over

then,

might

and

Hence,

the

never

victory

Commissioner.

well

in the next year or

two.

Individual Transfers Assets to

net

forward

one

Many

be offset against any profits made

Therefore, it isn't
that a corporation
having a
operating loss is liquidated or

often
net

its

business

transferred

study being made how the
net operating loss
may be used up.
Often
sell
if

times

the

shell

isn't

effort

the

otherwise

operating loss of the
tion

cannot

poration.

This

Supreme
and

are

agree¬

taxable

ordinary income; except that if
agreement is given primarily
for assuring to the
purchaser the
the

beneficial enjoyment
will

of the good

transferred, then the

agree¬

used.

new

corpora¬

many

cases

which

this

come

simple

overlooked

cor¬

years

dealing

point
by

The

indivdual

back

held

ruling
has
not
changed since.
Yet, it is really
surprising to observe the number

proprietor,

their assets in

corporation

fre¬

old corporation and
corporation
are
treated

many.
the new

such

formed

business to

them

up.

bankruptcy
reorganization
Thus, where
the
com¬

cases.

tute

for

compete

the

undertakes

made

carried

Court

pany is in financial

not

corporation*
to

was

corporation.

ment

without

careful

exchange for all the stock of the

four years to

as
ktwo
the partners of separate and different taxpayers.
The problem
co-partnership, will transfer all
equally comes

sole
a

times

may

and carried

year

much

for the deduction for
depreciation.
From
the
recipient's

viewpoint,

carry

in those years.

quently

for Stock?

than

subject

loss

backs.

operating loss

carried back

with

the Corporation in Exchange

may

will,

operating
carry

too
con¬

Probably everyone who is con¬
scious of tax consequences knows
that

ago,

Claim Against Corporation When

But if the pay¬

non-severable from the good
then the payment is not

net

and

the

the life

often overlooked insofar

overs

conse¬

all

are

done about it

is nothing

compete

tax

act

against the profit of the old

for

real

this

be worthy of correction by
Congressional action; and I would
not be surprised if
something is

Does Government Have Transferee

for the agreement not

the

But the fact remains that the net

inequity in the law would

ment made

But

sey.

cerns

saying that taxpayer had received
the

ducting the business in New Jer¬

the

compensation—and, in
any event, if he obtained the re¬
fund, he would obtain interest

Court

this way, it will not be
necessary
to have a foreign corporation con¬

quences

are

hands

liable

excessive

known

compete"

are

the

because

payments received

Branches

Members

Hence, the employee who received
the

have

part of the transfer of good will
in the sale of a
going business and

Kenya Colony and Uganda
Head

payment

became

the

obtain

seller.

stated

Main.

reason

value

ating Loss Carry Over or
Carry Back From One

Commis¬

of Har¬

BANK

Laird, Bissell & Meeds

to what extent they
be amortized. A reciprocal
question is then presented as to
how the payments received are to

capital

STOCKS

may

old

INSURANCE

not

business

ordinary
capital

they
then

tures,

re¬

certain period

made

are

"agreement

655

City.

New

that

excessive

poration

the

Then,

claimed

stock

same

Ordinarily Permit

against the

excessive

agree¬

The question presents it¬
to whether the payments

asso¬

the

obtained

earlier year when he received the

agreement is customarily made
one man sells a business to

start

their

sioner

agreement "not to compete." Such

Harold

become

Therefore,
was

higher

agreement

Bell

But it

unequivocally that if
is properly drawn, the

trust
nue

Exchange and other
announce

Freedman

cessive.

partly ex¬
tax
defi¬

was

of the

poration.

determination that the

received

said

Co., members of New

Stock

taining

compensation paid

of the life interest.

valuable

Joins Hirsch Staff

Paine,
Curtis,' has

the Commis¬

cases,

sioner said, "You have a right to
claim a deduction and obtain a

when

Hirsch &

sioner had been successful in ob¬

ciency.

The

another; and the purchaser
quires that the seller will

Nelson

of these

reason

form a corporation in the State
of New
right to terminate the trust or to
Jersey; have a tax free
invade the corpus such as for the refund in the year you paid the transfer of the business
from the
support of the life beneficiary, or transferee liability." But the em¬ New York corporation to the New
to pay over the corpus to the life ployee said "No—I'm entitled to
Jersey corporation; and dissolve
beneficiary, this impairs the value a refund for the year in which I the New York corporation.
In

the Kidder, Peabody & Co. report, because of

interesting opinions, is

each

further.

the

transfer

The

received

corporation,

assumed

bilities,

still

and

transferred. Of course,
the transfer of the assets to

vmnM

doctrine

but rather

beneficiary.

Supreme Court push this inequi¬

interest

life

study for investors interested in bank stocks.

(Special

the

had

table

pay

exclusion,
of

•

statements

its fundamental character and

eral

annual
value

under the $3,-

comes

structure

what¬

long

assets

the

by the

claim

unimpeached.

payer

Courts says that if anyone has the

period

historical
data going back to 1939 in the case of earnings and dividends and
1918 in the case of stock
prices. In each instance detailed statisti¬
cal information is presented on all of the individual
equities.

N. J.

estate.

These

one

above,

decided

cases

would not pay

example

the primary life

have considerable attraction for con¬
servative investors interested in a fair yield and possibilities of

Webber,

first

the

"Bank stocks appear to

the

000

have prospects for relatively stable earnings in
recessionary period in general business activity.

price appreciation."

Beneficiary,
Beneficiary can have the
any time he wants it be¬

trust which

banks
or

owner

but the trustee

Two recent

would be that the individual tax¬

able income. This problem

controlling stockholder
how member of his family.

it belongs to him.

the dollar.
"The

stood

in fact, "compen¬
compensation is tax¬

pre¬

It would

for such taxes

ever

is not the value of the gift to the

inflationary influences, such as the last decade. Since
1939, for instance, rising dividends and the increase in stockholders'
equity have largely offset the decline in the purchasing power,of

leveling

Mr.

employee must in¬

would have

Mr.

ment

was,

and

which

view that the govern¬

my general

compensation

corporate

sation"

the tax liabilities

individuals

existed the transfer?

the

for

the

because it

assets, can invest the trust
collect the income and piy corporation.

cause

marked by

paid, but the

clude in income the entire amount

ciency

and

selling at about their lowest ratio

to offer substantial

amount of excessive

bankruptcy. Does the government
have a priority claim in the bank¬
ruptcy based

for

corpus

over

deduction

corpus,

"Since Korea, the market price index of the New York City
bank stocks has risen considerably less than the Dow-Jones Indus¬

appear

obtain

significance

can be better
realized should
the corporation thereafter
go into

The problem of disallowance as

not

particular

this

the

right of invest¬
example of this would

same

expanding demand for equities of the
type by fiduciaries and other investors.
Under
present tax legislation, the investment by corporations in bank
stocks provides a substantially higher yield, after Federal taxes,
than high-grade corporate bonds. Corporations owning bank stocks
(or other common or preferred stocks) are allowed an 85% divi¬
dends received credit.
Corporate bond interest is fully taxable.

stocks

The

Compensation

corporation

instrument which says

the

Man'

"Bank

closely held and the employee

that
the gift is made to Mr. Benefici¬
ary, but Mr. Trustee merely holds

"There appears to be an

trial Average. Bank shares are
to this average since 1918.

Receiving

so-

The, only claim, in
would be by the gov-?,
against the stock received

right

whether,

assert

can

case,

usually
only arises when the corporation

matter

must

can

the

use

The second would be a
a trust where the bene¬

might have

established by the banks. Assets are highly liquid and include sub¬
stantial amounts of cash and U. S. Government securities. ;

'Prudent

beneficiary

income

of the trust corpus,

The

have

the life

ficiary is in fact the real

Other dividend

ultra-conservative basis.

gift

income

the

purpose,

worthy.
gift to

and there

year;

invade

increases, therefore, appear possible.
"The yields are fair. The continuity of income has been out¬
standing. Consecutive dividends have been paid for nearly threequarters of a century on the average by the banks under review.
are

where

trust

The Courts have

clear-cut channels.

two

ments trended

"Book values

future

used.

indicated

doubtful

their

corporation.
such

not

and

faith

good

defraud

by the individuals.
Excessive

drawn

are

in
to

government

ernment

Problem

The

that

it may be said
that if the trust is properly drawn,

that the outlook for bank earnings is favorable.

only 58% of 1952 earnings.

they

Under

called transferee claim against the

interests, a deduction for tax purposes of
qualify for the excessive compensation paid by a
$3,000 annual exclusions. In the corporation to an employee is well
It
last year there were quite a few known.
usually results in a
double tax. The corporation can¬
cases coming before the Court on
and

date

the 28 banks represent

held

Courts

the

trusts

create

the other

"Loans outstanding were

then

But

stock.

by the individuals to

intent

creditors,
the

transaction.

the

•

corporation

ques¬

could transfer, in the tion really is whether the agree¬
example given above, $54,000 each ment not to compete is actually
year instead of $27,000, tax free. dealt with as a separate item in

larly useful to institutional investors because of its. basic nature
and the opinions expressed.
While the report is concerned with bank stocks generally,

"The large loan volume

The nub of the

made

was

without

return, he

firm. It is particu¬

in each of the past several years by the same

tal payment.

for

circumstances, if the trans¬

the

ment is

regarded as non-severable
tage
of the "joint splitting" pro¬ from the good will and the pay¬
visions of the gift tax laws by ment received is treated as a capi¬

The

fer

JOHNSON
tax.

This Week

these

business

The

will

assets

often

times

consti¬

taxes
tax

against

the

liabilities

as¬

claim

individuals

which

arose

prior to the date of the transfer;
but

which

were

not

difficulty and

reorganize

uncovered

Chapter 10 proceeding under the
National
Bankruptcy
Act,
the

Thereafter, question frequently presented

the government will assert

for

the

substantially the only real

sets of the individuals.

for

formulating the plan is
new
or

whether

in
a

corporation should be formed
old
corporation's ^capital

the

structure, etc., should be changed.
The
a

net

better

judgment, if there is

operating loss to be availed

Number 5228

Volume 177

The Commercial and Financial Chronicle

...

(2547)

.'Ml:

turn was filed it was false and penses for traveling between his
These are but a few of the tax lated eauiDment are estimated at
fraudulent; and facts which oc- home and place of employment changes which are being studied S127 630 000 in 1 vn and

of, is to use the old corporation
—and not to form a new one.
■

later on, which taxpayer are not deductible, and also, his
in
mind on this subject are:
had no reason to believe would expenses for living at the place
In one tax court case, the cor- occur, cannot be used to make a of employment are not deductible,
portion was m the glove manu- false return a true return for pur- The reason for the rule, accordfacturing business when it had poses of criminal prosecution.
ing to the Tax Couprt, is that "for
A few additional points to keep curred

•.

corporation
The

ers.

The Professional Man Gets

was sold to new own¬
corporation,
changing

The

into * the

pense.

permitted where the cor¬

charter

corporate

original

the

reversed

deductible

business expense.
In
this
case,
an
attorney,
a
member of a law firm engaged in

this

cause

■

successor

rpbe'

Commissioner

solidated
companies cannot be
carried forward, and the net op-

ReVenue

statutory merger, there

which continues its cor¬
porate existence to be carried for¬

company

But

merged

the

corpora¬

right

the

solidate

lutely

Don't

is:

problems

dissolve,

necessary

making

fund of

—

the

merge, conunless abso-

but

company

one

many

incidentally increased his
learning in general and in

gained
that

the

gense

consider
subsidi¬

over-all professional need to inthe expenses in order to per-

cur

current staTus

the

overshadows
that

in Relation to Fraud
and Deficiencies in Prior

the

y-y*:}
that

Years

v.;

law clearly says
operating loss is to be carback or carried iorwara, and
pack or cairiea forward
anu
tax

net

ried
rieq

be-a
later
as

the earlier or
vear
as
the case may be,
.year, as tne cas
y
it were a loss actually occur¬
deduction

law

inK1

teature*::

profits

etc

shall make a return

1099

Form

such

oavment.

taxpayer of
actually had a larger income
the result that his tax was

1950
with

the

Uli)ttau
ui.
.;
instead . of $5,000 -r-/but
but
only the $5,000 tax was reflected
in his return when he filed it on
March 15, 1951. And let us assume
that the net operating loss in 1951
when
carried
back was
large

,iUUW
$10,000

enough to eliminate all
its and all the tax

Nevertheless,
has
pay

the prof-

liability in 1950.

the Supreme

Court

that the taxpayer must

held

interest on the $5,000 of taxes
originally failed to re-

which he

,l?

•

eliminated

ally

where

the taxpayer was

indicted turns.

for filing a false and
fraudulent return. At the time of

that the net
operating loss for a later year
when carried back to the year of
the tax return on which he had
been indicted, eliminated all net
ineome and all his tax liabilities
for that year.
Therefore, he arth^

trial, he proved

gued, how

from

stocks

additional

several

subsidiaries

well

its
as

^ received from the sale of
their common stocks to meet part

of the estimated costs of their

construction programs,
The nine utility companies
which comprise the parent company s operating system supply

White

William

Hornblower

White,

William

Weeks, New York City, was
elected an officer of the New York
Society of Security Analysts. In
the "Chronicle" of June 4, in reporting the Society's election, a

electric service in seven southern
and midwestern States, serving
over 2,000 communities with an
estimated aggregate population in
excess of 4^2 million. The name- cut of William White of the Lackplate rating of all generating awanna Railroad was inadvertent-

closing loopvP/
matters
genuinely Continued

Some

R„rpan

„

from page 14

include the

Bnsiness Ontlook Dubious

think* that

manv

In Second-Half of 1953

il-

foe Bureau thinks that many 11
logical discriminations have de-

v-loped which should be correct-

tent and at such a rate

the

sum

that today

total of this item, which

contributes to the uncertainty on
the part of the lender, which in

It has been said with complete
tors> co-partners, professional men an ine asseis or au me savings anu
undoubtedlv be loan associations, 60% of all the
the not too distant time deposits in all the commer- accuracy that it makes no differ^ The fai|ure q£ ^
fint aial banks and 30% of all three ence how the money was obtained
as long
as no one wants it back.
]gw £o pmnit coverage of the together.
When that time comes, it makes

,
soie nroorietor general partners,
proprietor, general oartners

.
.
Alarming Growth in Consumer

professional. man> etc., is; one of
the outstanding gross inequities of

Debt

raPid depreciation of investments in capital improve-

all the difference in

The
sumer

debt

growth in short-term con¬
debt is the most alarming

increase

with which we are

the world.

impact of all this on

The

managers

the

of the thrift institutions
reasonably apparent.

should

Today's

high level of business is

^ptwpa^pnm" that they are vulnerable prompt
to any
vp
wp arp f>nm~ extent whatever should

their use and misuse are too well

r. nvmpn

Inttr

ml"^tvynf retronehm^t81wh.Vh
f'S w
™»«le« production ana less em.
nnt
. .P
^
lllcSCaPaDlC IS I1UL UX 1 IbtJlI 3. SC*"

known.
,
Exemption from tax on earned
income by individuais who spend
at Ieast 17 out of 18 consecutive
months in foreign countries is in
for some Unn'nr,lltr nwnn+a/I 4a This
possible change.
tirnn

was

am.

basically enacted to en¬

ployment and yet we are com

rious

matter.

By definition,

Travel Expenses Between Home courage persons with special tech,And Business
nical skiHs to accept employment a re^f
One of the most constant ques- in foreign countries. But advan- level of activity

it is

IpJSi

to a normal level

the managers

of the thrift institu¬
ordi¬

tions to exercise more than
nary

caution in the maintenance

"•<= ■—■=.■—

Qf liquidity and loss reserves. This
could prove to be the cheapest
insurance

policy such an institu-

titution

over

Summing
sion:

The

took

qut.

the entire discus¬

Administration is con-

ot acPvlty ana Js nfaltdy* A ae' . ^ ^
.
highly paid individuals whose pression is a retreat from a nor- fronted with the problem of
wor^k in foreign countries is clear- mal level of activity to a subnor- accomplishing a slowdown and
ly of a transitory nature, such as ma* 1e v e 1 0 f activity and is avoiding a breakdown. Managers
moving picture stars who will in- unhealthy. It is extremely diffi- of the thrift institutions could find
tried for he is working there. It is quite sist that their pictures be made cult to keep a recession from run- themselves in serious difficulties

could he be
pay

Security Analysts

trie

tions which comes before the
Court, particularly the Tax Court,
for decision concerns the expenses
which a taxpayer has to travel to
another city and live there while

tage of the law has been taken by

taxes which he unfortunate, but the Tax Court in Europe.
,ning into a depression, particuThat seems to make continues to repeatedly hold that,
f
wiucu uitume credit emia ana larl
Earned income ueau. Child and , ,
•
-4. i.
f i»_
the recessl0n itself prosense.
But the Court threw out where the taxpayer's home is in Dependency Expenses of working duces
any substantial number of
the taxpayer's argument and in one community but his place of wives. The 3% annuity rule, etc.,
debt defaults, every one of which
effect said:
At the time the re- employment is in another, his ex- etc.failure

didn't uw<=.
owe.

uiuix

UfLU*, Afi:*,**..

If 111b Kb W11116 UITICGr Of

J!,? '

law

tried

and

mg dUrmg the perl0d-

in part
con¬
presently confronted. In 1945 to- being sustainedexpansion. byWhen
tal consumer debt was $5.6 billion tinued credit _.W(lllowu
and instalment debt was $2 billion ... .
.. mugt demand
of that total. Today the total of decreasP'and we ^ill be conconsumer debt, as: just stated, is fronted with the problem of over$25.7 billion and the total of in- Droduction when debt reoavstalment debt is over $19 billion. £
exceed credit extensions
These debts are short-term debts. th
f
,
m have tQ CQme Qut
They must be paid in varying
savin2<? or out Qf current Durment to have taxpayers file in- tal tax revenues.
periods of from one month to eLslnErfowL No one knows the
formation returns. While the BuExpense accounts are under three years. To pay thern out of exten^. to which today's savings
reau of Internal Revenue will re- ci0se scrutiny. The advantages of ^u-r^ent
wa must have no are vuinerabie but the mere fact
,

and

crime. Where the Jli0
i?.!!16 indictment only
/
referred to Form 1099, the indict- ments> plant and equipment, or
ment was defective.
\
at least a higher initial depreciaThe significant feature of this tion, is carefully being studied,
case is that it is apparently the The granting to management of
first of its type to go to the Su- greater discretion in the timing of
preme Court. Also, it demon- depreciation, in the long run. will
strates the constant vigilance on result in the increase of total inthe part of the Treasury Depart- vestment, national income and to-

duce its personnel by about 460
employees in the Processing
doesn't Branch at Kansas City, this will
have to pay the taxes at all.
not hurt the Bureau's system of
Along
similar lines was the matching information returns
holding in another recent case against individual income tax re-

port and pay, notwithstanding the
fact that the tax liability is actu-

ended

stock of Ohio Valley Electric

tbe decision
the
.

months

Corp., which corporation will supply the power requirements for
the ^Atomic Energy Commission's
project in Ohio. The several operating subsidiaries will use the

dedsinn^s that the wilful the tax law*
' v
is
^ file Vnrf 1096 is a
() «
The necessity for Permitting
to
Form

"f
of

company

proceeds

of so-called first being studied,
fringe benefits is
among the

was

N. Y.

investment

for

those

exceeded

of certain types of payments, such
wages
annuities
as rent, salary, wages, annuines,
or fixed or determinable gains,

31, 1953, amounted to $21,-

or more

split

10, 1953.

of the parent com¬

the

for

two-for-one

to purchase $4,000,000 in common

The entire tax treatment of
pension and retirement plans and

$600

of making tax laws plants included in the system to- . .
, ,
,, ,
.
wrm_„
equitable in years,respects. Over tals 3,032,271 kilowatts. for addi- ^ inse^edwhose correct picture is
all the number of tures by subsidiaries Expendi- R. White, for that of Mr'W/lliam
the last few
J* thTtU iaw« whirh 1
y
iui auui- »
chanSes ln the: tax laws which tional generating capacity and re- given herewith.
have eliminated inequities- have
■
.
■■■■t>*- <.,*p

payment to another of
in any calendar year

making

cents

made

wnc

!j>D,

holding

the

use

operating

The Bureau has ruled
the year the treasure trove

holes.

suppose

vainp
value

utility

common

necessity

$20,000—the loss for 1951 is carried back to 1950, thereby elim-

But

sale

and
the taxpayer to legitimately avoid
taxes by finding new and differen^ l°°Pboles in the tax law. At
the same time> the Treasury Department is constantly exercising
viSilance to close up these loopboles as rapidly as they are uncovered.'■ Yet, at the same time,
Congress is not unaware o
e

5b Ui lyT" * " " "7aririrPWR of' the
the names and addresses of the
payee and the payor, amount and
inating all profits for 1950
and kind of each payment Form 1099
also reducing the tax liability for neednot be signed but Form 1096
that year to zero.
The taxpayer must be signed by the payor. The
Vioo
thof
would therefore get back his $5,- /Supreme
Court^has held thaUthe
000 of taxes if he had paid them, wilful failure to file Fo^ 1099 is
.

it, according to a

Department regula- under consideration
require
that any person following:

tions

will

at all times for the tax man

Returns

Information

The

studipd

feature"

nar

par

law

J£ootr
Vrii Rn np?Jh»^
2 'J '
^
per share
b£Sed °" the average number of
shares of common stock outstandHurW tho nprinH

common

curities Corp.

Tax chanfes Be,n« Studied

personal aspect

decisivp
declslve

pany

800,000

Company

"to

First Boston Corp. and Union Se-

There is the constant struggle

March

™ent firms headed jointly by The

to be decided by the Courts.

Treasury

Thus, if a tax-

ring in that year.

the

ttie

and

made

by a nationwide group of invest- llf,*.

the

is reduced to possession income is
received to the extent of its value
i*1 United States currency. But
whether the Bureau is correct is a
question which someday will have

rpMrd tn

Hup

Electric

and
stock
SlOCK,

partment.
that in

yesterday (June 10) at $29

recent ruling of the Treasury De

far

Carry Back
•

the
tne

i*
1S

it
11

Loss

Operating

Net

Effect

with

hie; wnrk

fnrm

dated returns.

acquiring

think ? that

ary of the other and filing consoli¬
.

CQst

personai expense* but
the
immediate

it may be a

^answer

expense

his

the merger,
The

such

that

come taxes on

wen adapted to
professional auty to keep

going trade or business
It
may be," the Court went on to
say"mat the knowledge he thus

will
forward

carry

that

way

fill his

loss which occurred prior to

any

testing

and

individual who finds
treasure has to pay Federal in-

sharp the tools he actuallv used in

which loses its identity

lose

said

Appeals

prior to the merger of the

ward.

Internal

position

training is personal in nature and
not deductible.
But the Court of

carried back.

nothing which would prevent
the, net operating loss which oc¬

the

lodging.

taking of special courses and

erating loss of the .new corpora-

and

board

took

tui-

for

dollars

than

distribution

The

1909

share, was made on June 10,
a 2V2% stock

dividend

additional shares of American Gas

Treasure Trove

taxation and in that connection spent
hundred

better

canacitv

1953, and followed

March

Public

The lucky

a course on

erasing losses of the former con-

tion

for their

was necessary

practice, attended

travel,

curred

much

jury,

would

This

per

Net income

rax Court.

vearsince

amounting

of Amer. Gas & El. Go,

issue before the Tax

him to keep cur¬
changes be-

tion,

tax laws and

severai

But in

with

Court,

general practice, and whose part¬

corporation is deemed a n©W taxable entity; and as such the op-

tion cannot be

and

necessary

•,

ordinary

relied upon

new

ter chance of having the deduction stand up by paying the tax,
anu seeking a reiund by a suit
in the United States District

and

said that such expense is properly

rent

...

Tax Court

ea^

Bankers Offer Stock

Where a question of

this type arises, and the amounts
are substantial in nature, a taxPayer would probably have a bet-

courses

"learning"

his

fncfease

changes may be expected
Ex- bv 1 000 000 kw
caPacixy
haustive hearings by the House
Di'vid^nH* nn ih*
Ways and Means Committee will common stock have hPPn

place of

in nature.

to date? The Court

ners

the

keep

was

pay license fees.
Where there is a statutory con-

solvation,

of failure to

because

terminated

gen¬

Appeals for the 2nd Circuit has

now

poration's business was taken over
by a reincorporated company, the
formation having the effect of
merely extending the charter of
the.,old corporation.
But a carry
over was not permitted where the

who attends

man

order

current and

District Court Case, a carry

over was

education

considered a personal ex¬
But what about the pro-

fessional
jn

cost

erally

profit which it carried
back against the prior loss.
This
was held to
be O. K. because it
was still the same corporation.

made

generating

ministration in Washington. Many the system's

purposes

his

Deduction

corporate name, then went
jewelry business
and

the'

Ad- 000 in l!»4 which wM

new

the man's home" is commence on June 16. Altogether
employment and 40 different topics will be taken
any travel expense he has to go up.
between his place for employment
and his "actual home" is personal

tax

The capital stock of the

its loss.

and considered under the

even in a slowdown. The policy
~
4.•
i
of conservatism is always §ound.

Under existing circumstances it
is imnerativo.
i-KL^

The Commercial and Financial Chronicle...Thursday, June 11,

(2548)
•"

•

■'

.....

-.''"y

,■

/■/'■

and Fourteenth Amendments pro-

aaIv

Ilflllfvf

•

•.

1953

•

the theory that the Fifth policies of the companies, the in-

fmm >nnnp
jiuiil pujv

l^onunueu,

■

industry it is the steel skeleton of

jury to the public and the inves-

new

generating

station

rising

Hon
ll6W MUa Hi V ■«■
A«v IllllY Hvljllllllllfll fiscation resulting from from con- serious. have indirect, is no less against the sky or the long slash
V*
1In!■■ fill ably low property has tor. must
tected utility regulation
It although intelligence
|

unreason-

rates,

between

erated

ing and discussion as is found on
appellate benches.
The duties and functions of today's Commissions are only too
well-known to this audience. Because
their decisions affect all
concerned, so vitally, only a wellinformed Commission adequately
staffed and compensated should
make the key decisions. These
metl need not a11 be exPfrts in tbe
techniques employed that is, in

organic legislation
who administer
Acts under which
Commissions operate

itiation—the
the

»ius

several

the

relatively ineffective powers
to strong and
sweeping delegations, in some
cases
approaching the limits of
management of the property itin scope from

ranee

U
Tf

there

that

frIlp

some-

annealing to

man-

enough
confidently.
It must have independence enough
to judge fearlessly. As is well
known to utility lawyers, public
utility regulatory agencies in their
opinions are deciding questions of
law which within very broad lim-

opthe

hand and the ceiling of un-

0ne

reasonably high rates on the other,
Broad as these markers have left
the path, the final responsibility

our

persons

basic

The

this floor

0f marking the proper line where
reasonableness lies in a particular

But this duty of
revenues

which

are

sufficient for

by
othef considerations which
the responsibility of the Com-

many

the

a^aJiablena rendm-in/

-controls, the tremendous size and
Investment involved,
the wide-

E*?

«iomic power

without checks and

nnd

fth<Mrver

difficult problems begin

lo emerge.

^thl

^vkir^lcv^
yd

and

staff

ofsoundiudg-

men

lir,ouestioned

inteeritv

opposed to, for

prospective

the

debt

ra-

structure itself, to

name a

exam-

The danger is, as
Arnold has said, "that

the Courts.

are

can

befall

rpgulatnrv

pvnpripnrp

'Commission

hgforp

member

staH is fuUv conversant with

necessary per-

free people. The
between bureaus and

the

themselves that

interests

blllty

every matter before

uouna

poWem

As
Iflrn
«iw

4.u

part

the

structure
siruciuxe,

Commission

•

nce anT1^1eSS1utUSityr0industry

Qf
•

4.*

administrative

however
nowever,

utilitv
utility

a
a

suspect of harbor-

their

respective

cautious lot

are a

the utility field.

it. policy, however, the confidence

°fy

1"suan?e W1rtth a ^ust reputation for enforcm
contmue of rate conservative fair and sound!
t(J lng
consequences

;h
the

decision long after it is

policies, capitalization ratios,
financial reporting and accounting

ren-

derrAed' Jts responsibilities there- procedures to name some is of
^e' ar^far greater than those of first importance to such a deter^any ^uris ^ mos! Proceedings mmation. The investor knows
E
Commissions guard where he stands. The company
f

c"arged.

More and

fhl?r

with

Pr°Perly financed and healthy
» structure, ably designed to

nersonnel

nolicv

and

peisonnei

ana

Pullcy

which

wnicn

from experience? How can
Commission5? exnect to attract and
commissions expect to attract ana
comes

retain experienced

personnel

Pricmg

their

...

.«

«rpatpc.t

WII1Ln W111 promote tne greatest
volume at the lowest unit cost
con„isl.pnt

un-

ith
mu;_

conn'H
i_

pponomip
j

interest

stops at the last line of the

income

^ment is being changed. True

there are many factors between
the utility operating income and
the net after income deductions,
SU
aCf ca?.lta atl°" and management
policy.

As time goes by,
in

investor
State of Connecticut, the capital structure of the com-

?fr

h^ta^rnor

mdust y'and interf
tdrfered,

the industry ana
tne
services
at rates

the traditional

however, investor's attitude that his

the

trie
i

Now, the investment counselor
and the investor

can

bound by red tape."

-are

company seeking the money
must pay for it. And need I remind this audience of the impor-

Ula**JS *S ?• c?ntjnuinS process the company is probably the greathp5nMMiSS1Mi%vf0n*Cern 1S es?,single factor. A Commission

every

ably and effectively

are

Mil'er oT^Z^on clnTe^
S bSv precedent, ana Dureaus pIate^ by law of the continuity ^lopmlSteln
and°Ubureaues
Commissions aeveiopments in
Dy Sen"
be assured
distinction

part the price

the

1S A great many factors influence
on their decision to buy at a given
,,+iiitxr
price and hence determine the
y Commission, how- cost of capital to the company,
has a continuous responsi- Aside from governmental fiscal

that

measures in large

matter when upheld

weighed and judged at the Comi"dgments have not been
theutiity industry mission level. . The nature and f
fcaps in a complicated civilization, Yet du -inv this oer od and after modern concept of the function of ® ®lia„1?eiul mockery of the contiut if the bureaus increase in the
indivkual has obtained a de- a Commission, however, discloses J®pt °lthe quasi-kdieial regulamember and power, we suddenly m-ee of skill a nri
e^nerience the that these interests when extended ^
Y
should be elimfind that without knowing it we compensation
paid to these men is far enough merge into one com- '"a
Ho 3fh Pr?nhP
Th3S irfno m"
tiavp creatpd
'bureaucracv' ^omPensaiIon. Paid 10 Jnes® men 1S mon theme
That is
the ureser- ca
do the Job- Tbe Honorable
wMch is one of the wo?st fates dangerous!.V inadequate. How can
encouragemlnt of a John Lod^e' the great Governor
Thurman

-•few bureaus

and individual.
The eagerness
with which they avail themselves
of the investment opportunities

2ing,res

an£ ° f
Sht

'
live

From this brief catalog of considerations which weigh a Commission decision, it should be obvious that for selfish reasons alone,

new

facilities,

will be invested

plant they built themselves, this
money must be supplied by investors—large and small, institutional

Sprain ^ndS *r\.ad.ho.c —Particularly in

a S
with

few.

war

plant

before this trend slackens, according to the best informed people,
Because
a
utility
cannot
and
should not be permitted to expand

in a(.
proceeding ends in
Practically all cases when judg-

rea-

exthe design of the rate

the

and

trnas ■?. ssrsssfcssyTs raa'saurrsas

3SS-SS& «H5i ME
«gencies

and

since

decisions are concerned
with matters of far greater magnitude than almost any of °ur high tance the cost of money is in the
state court proceedings. Moreover, ultimate rate which consumers
!he conFern which tbe court has must pay for service.
e

ex-

Objectives of Regulation

turn to the personnel

For

tio' the value of service, the
sonableness of the operating

but never on top."

who administer the laws, some of
more

intensity

obseivei, "must alwavs be on taD
must always oe on tap

I*r»blems of Administration

the

vested

equipment
And billions

mission

of subsidiary decisions respecting
the cost of capital, historical, pres-

penses, and

mrithout checks and balances."

subject

amP1e, the decision in any particular rate matter is compounded

dif-

verv

/ "sacriffces^^he inSsht

balances than governmental power

When

companies

customers and investors.

the

urge

nolicv*

1thiri1f a"f a Yetly
thing to insist that the

ferent

"Freemen

permit private eco-

making

the

their jurisdiction and in turn their

decisions

consultation

statements as former Presi-

«an

thing

®®d
f_-® y
£ ano'ther

ctent Hoover made to an audience
»eeentlv when he said

cpread ownership and the concentration of economic power, prompt
•such

Xct

competitive busies the Commission should be

.dativeto

away to
the horizon.
Billions of dollars have been in¬

consequences which are virtually
incontestable except on the basis
that they were arbitrary or clearly
contrary to any evidence on record- It may amaze you as it did
when I became aware of the
fact that in terms of dollars and
m terms of people affected, Com-

influenced

a11 the refinements of the indus- are
try, but they should be men of mission. For the fixing of rates
utility sound judgment. There is nothing would
be iargely emasculated
J
After all
who would more potentially harmful to the without the correlative responsithp
ffrct to complain of im- regulatory process than regulators bmty and jurisdiction over the
^Jw management if it were s0 steeped in detail they cannot adequacy of service, safety standowners9
It needs little see around their subject.
Over- ardg> security issues> accounting
however
to
detect
the specialization in the person mak- practices and principles.
The charth^ tinal Judgment is danger- p
dpci,io^ of Commissions
££Kti«o C utiUW business ous in any field. There can be no thJnh^umulate over aTeTatfieW
nublk rSnsU d°»bt
that hiSh'y skill?d ™e,n Snrt Dtrirkto /bodv bf inXtilities of the utility company, the trained in the mass of detail which ence ancj policy which can and do
Ut le

natural gas pipe line trench

stretching

and

its plant from surplus earnings
are the Courts. They are also mak- supplied by ratepayers who will
in£ findings of fact with sweeping be required to pay a return on

determining the

company

the thought of op-

SnT fS with
SSt irnnnJd

surely

rests with the utility'com- itations are final judgments. They
are making law just as surely as

case

mission.

the

judge

, have

ith

TTtilitip<;

Jir®"®.1iaie *0? I
Commission of
.
.

.
.

sphere

utilitie<?

g."

judicial

•!'

•

our State in its ju-

fu,nctioni

nublip

in_

never

nor would I ever seek to

far

a«

concerned,

commission

the confidence of the

a
in

protection

Vestment, ut

of Ws

willinmiP^

invp^t

?rnw<!

willingness to invest grows,
result

to thp

romnanv

ine

whirb hpnpfit<; thp
.

...

and the investor alike.

consumer
The

ThP

reduced cost of money

imnairment

thp

financial

Has
«re

even

who
wno

manv
many

disagree
aisagiee

on
on

proper organization and func-

Hon

utilitv

true in must numan situations inuue in most human situations, m
dividual companies are deeply in-

Commission

•Should it be passive

volved with the nroblems of their

independent

own

businesses

2dtadfc&PS£ 'Snfr^hen MK
SSy

Should the Commission act merely

fiiSn^ of fact

and

rec-

Mm*

Public
the

Utility

XrhanI

your

indSto

buTIrrtc^ril^nter'estd Tn

investor and Commission together ^ upuiousiy sdieguaraea ireeaom increase tne cost oi service to
Undpr

sound

rom

aim. unaer a sound commisslon, ably staffed and admin-

istered. such
achieved.

an end result can be

Good

regulation

con-

°f action as
.

wuirh

we accord to the courts

+bp

mmmiccion's

the people and the prosperity ot aspire.
the State.

«s Staff to be familiar with rail- and just regulation There'is no
roads, motor common carriers, gas doubt in my mind for the reasons

positions has much
The best

answer

S'«»,be that the customer is ^"eoLalks telelhone^Ind
^^inlL„ gigrelSMe^r0 utility tele»IaIh^omnanies bussef taTk
e.C r^n
mt nis interest, while the
telegraph companies, busses, taxi-

^J^,ivVeSt0rS me and imparequally responsible en^led t0

Cal

tribunal.

•lowever, truly

sound

shall

This is the ideal which hibits

p'vamnlp

,t0

•lent.

dilemma in this predicaProperly administered, or-

^nized of bureaucracythere is
and staffed,
Hanger
m a
of

htu

the

fears

are

well-

aEd "le1^ investors realize the
The development of atomic piles stake each has in good regulation,
nas progressed beyond the labora- JJU(dl of this problfem will be on
tory aiJd discussion stage and now the way to solution It is to everyPresents a current problem for the one's advantage that service standelectric utility industry. This rep- arcls be as high as possible and

4ion

valid

the

men

it.
Its big weakness is
«hat it depends for its
vitality and

necessarily sition and presumes that its prindeal and illustrates the breadth of cipal purpose is to oppose the in^e experience required properly dustiy can do no one any good.

on the person of the regHiator and on his

agnizing this,

Rec-

Commissions

have

^minister the regulatory

traditionally plural, provid-

log for the

benefit of ^
groun think
p

iato.ry agencies must

validity

integrity.

resents but one of the newest tech- rates as low as possible. The Com™cal questions with which regu- mision which misconceives its po-

who ad-

•niufeter

t>ecn

entrusted
necessarily to the
regulatory agency is wide indeed.
like the idea of
censorship, regulation to a large extent is as
good
as

public, the companies,

4grounded, however, for the discre-

regu-

agency.

-Some

dSMfc'utilHief'T5 ImltyfndtltrvUesTnthT hUdl
eieVri? public utilities., It is Ulll"y maustry lies in tne nands

»'eachtoiIthese cat egories with- continuation of good utility
.? fLiJai?mg ai
P
e f e d of regulaWhen the

regu-

fatory

•

S1nCG

Supreme Court

•+

procc*

g^^rMngemeHIr^
e

•

^mted States so inadequately staffed that it

was

■

•

this

from

area

trespass.

persuaded to unable

r»np

..tlmt

rapidly

has scientific

business,

The Consumers'Interest
.

us conslder

demonsIraTTfo hi

hlsto^ ™f gSd^fficient

serWre

utilityttatiS

pr0gress in the "eld with which

conthiuation^

ship and the
of
snip ana rne continuation ot auri"
a pri-

on the partrf the

" is eoncerned- The outstanding

company is a good company-his

Darad0v of

our

civilization is that

nrirp

men have provided us with the as

machines of

anyone to of the regulatory bodies For this
be luI1y conversant with the func- reason, if for no other, the public h
tioning, financial aspects, and the and the utility industry has a tremany varied problems which arise mendous stake in the health and g

•ees no

tho

had

gressed

humanly impossible for

see,

regulation

the final analysis,

llMMild'coSI Wis^L^^afe

*» recommend it.

„

«mmendations, or should it affirm- and concerned with all the prob-For a reason far less personal their efforts to aid
Commission
■•lively and aggressively play an lems of all the utilities subject to and selfish than the prosperity of
regulation
in
achieving
When
exclusive role as the protector of their respective jurisdictions. The the individual
company, utilities
that purpose is accomplished, men
Hie public against the alleged mo- business of regulation makes it generally
should welcome,
enPrtrif;HPntiv
iw Jn' rptf.
Wpolistic oppression of the utility? necessary for the Commission and courage and support strong, firm
ulation thpr#» iq
Each of these

customers

Hppi

x? wbich tbe commissions deciThe chief remaining influence
sl°" r"a.y be aj5pealed;
not affected by regulatory powers
..This is the dignity to which al is management itself. But our

giant but

our

social

rnn<?pinii<;np<?«?

that

ratpnavpr'<?

adg,a^priL
mismanaged and almost bun-

Zfa lndid luutyment A
opportunity^ vours gens

i«?

nnt

nparlv

acVe E~enL deZn^fates
ronpprn

nvpr

mLh S acute
where lervke T Lf It hk
Ilncern with^erviL o'nt asfa h
Her the higher rates It
rise

concern

UeSen ofthe^ulty ildust'ry.Io fathevagariesoflnHrtainlol"
recognize this paradox and to

ac-

cept the challenge presented in it

flickering television set—

age—a
a

burnt

out motor—an
.

outage at

as part of your
Work for sound,

Bet

responsibility to mid-day idling hundreds of workable regulation, ers and costing thousands of dolbriefly review some of lars in lost time—these are the
.
y h regulatio.n can real concerns of the customer,

aff ™ the ratepayer
?ts ^esto? ThL'

compaiw

will

and

disclose

fiLlaTdcinclu^ve proofthatit
^ Merest ^the ?L^ated
10

insist

^uc^sist

Management.

eood

relulation
inSlft
Sood

'
,'
The Inves^rs Interest

Consider the cost of capital. If
typifies today's - utility

effectively to question the anything

But

insurance aeainst such

certai^t^s L noslib?!
youhavea-HoodoW
ulation
such

tween

Goodrel-

'Ss and^couragf

facmtiS

coooeraS

the?compLy^nd

miSon

un-

provided

aMkipating

the Comits

needs

by'taHHgHriffeTlistk cTatms
before the Commission
for

the

need for additional funds and by
the Commission recognizing this

Volume 177

Number 5228... The Commercial and Financial Chronicle

need for expansion and accommo¬

Continued

dating its thinking to it.
In

such

climate, service will
adequate and reliable, rates

and

Commission

confidence in the

and

the

companies

complete.

The State of Trade and
tions between

closing, let

the problem of rates

us.

little

A sound Commission

will

policy

which

will

encourage the company to utilize
all the data available to determine

accurately

as possible the ex¬
plant responsibility of

and

each class of customer and to price
its product accordingly with com¬

petitive and other economic limi¬
tations in mind.

The Commission

adequately staffed and
•equipped will weigh these judg¬
ments and

fix rates based not

expediency or instinct. Thus, the
forces of supply and demand will
be brought to bear in improving
the load factors and encouraging
the

greatest volume of

use

of the

company's product to the advan¬
tage of the company and custo¬
alike.

mer

But

only in

wages

fearless and

in¬

formed

regulatory
climate
such decisions possible.

are

increased.

are

settlement without

wage

specifically.
follow

•

the

depends on the amount
the signs point to a
steelworkers

The

have

not

specified the amount of wage increase they seek, but trade gossip
has it they will be satisfied if they get around 10 cents an hour.
Almost

steel

man

time, but their position

executives

oppose

hike

wage

this

the question has been weakened by
recent revisions in automotive wage
agreements, continues "Steel"
In

event

steel

raised

cents

hour, market
observers are of the opinion base prices will rise $4 to $5 per ton.
Such an increase added to those resulting from recent changes in
extras will likely force steel consumers to adjust upward their
prices on finished goods. The exact amount of the steel increase
arising from the revision in extras cannot be determined, but
wages

are

some idea of the effect of these
changes on steel costs is shown
by the rise in the Bureau of Labor Statistics' finished steel price

index which

stands at 136 compared with

now

130 in April when
inaugurated, it points out.
wage and price questions are out of the way

the extra adjustments were

Once the current

the steelmakers
market

the

toward

are

expected to

various

firm and

duction costs

move

products.

realistic position on future

and competitive

achieving

they

toward

Generally,

inclined

are

stable

pricing, with pro¬

factors in mind at all times, notes

this trade journal.
With

steelmaking operations booming along at capacity pace,
supply is comfortable, assuring support for highproduction through the year, it further notes.

material

raw

level

If this

industry wants to assure
prosperity and ex¬
pansion and to enjoy the confi¬
its

The

continued

dence

its

customers

the

and

public generally, it can do noth¬
ing better than to lend its great
weight to the end of achieving a
anniformly improved utility regu¬
latory climate throughout the 48
states generally and the territories
and insular

toe

done

spent

end

ideal

and

im¬

wants—state

lions of dollars of investment and

payers' dollars which

ture

cases

and

are

but

totals.

rate¬

in¬

this great expendi¬

Only a
■Commission which is adequately
staffed can discharge this respon¬
sibility objectively and efficiently
without undue delay.
our

Every

fair

see

42,100

that this type of regu¬

The

companies will be on far
ground in their protests
against the incursions of the Fed¬
eral Government into the field

state

regulation if they can point
vigorous and able stdte com¬
mission, organized and equipped
to discharge the obligations im¬
plicit in public regulation. States'
rights are best discharged by rec¬
ognition of states' duties.

consistent

are

with the highest ideals of the pub¬
lic interest and that a cooperative
effort to support good organic leg¬

islation, informed, dispassionate
mature interpretation,
ade¬
quately staffed and compensated
commissions, and a mutually co¬
operative attitude by companies,
commissions and ratepayers will
do much to cement a strong util¬
ity structure and thus a strong

and

economy.

The true protection of our free,
private enterprise system in which
the public utility industry is basic,
Is a soundly conceived and inde¬
pendently conducted system of
public regulation in the public
interest.
as

The

the utility

alternative

insofar

business is concerned

is and always will be state owner¬

ship and control. It is in this

par¬

ticular respect that those who are

regulating and those who
ulated

are

united

are reg¬

unalterable

opposition.

represented

increase of 89,895

cars,

5.7% above

tljie corresponding week in 1951.

car

production in the United States last week began

output for the past week

made

was

of 110,387 cars

and

14,877 trucks built in the United States, against 101,466 cars
and 12,519 trucks in the previous week and 92,956 cars and 24,858
trucks in the comparable 1952 week.
Canadian factories built 8,033 cars and 2,860 trucks last week,
Ward's said. In the preceding week they turned out 8,735 cars and
3,148 trucks and in the comparable 1952 week 7,334 cars and 3,689
were

assembled in the Dominion.

rye registered the sharpest declines and touchedlow prices for the season. The July wheat delivery at Chicago
down to $2.00 % on Monday of last week, a drop of almosfe

sold
50

cents a bushel from last year's high $2.48%, and the lowest
point reached by any wheat contract since March, 1950. Lack o£
export demand and fears regarding storage facilities for the newr

Commercial
ended

and

June

industrial

Corn

ments.

declined in sympathy with wheat with weakness
prompted by the announcement by the CCC that it would sell lowgrade corn to feeders. Oats showed comparative steadiness. Vol¬
of

trading in grain and soybean futures on the Chicago Board
sharply last week. Daily average sales totaled
51,700,000 bushels, against 36,700,000 a week previous, and 32,300,—
ume

of Trade increased

000

year ago.
Flour prices

and

tively.
war

failures

climbed

217

the

168

the

casualties were considerably above the totals of
172 in the comparable weeks of 1952 and 1951, respec¬
Despite this increase, failures remained below the pre¬
1950,

level of 279 in the similar week of 1939.

bers generally continued to confine their purchases of hard wheat

bakery flours to small lots for immediate or nearby delivery. Cocoadeveloped a stronger undertone in response to somewhat broader *
manufacturer demand and a lack of sufficient offerings from pro^
ducing areas. The market also received support from reports that
the British Cocoa Marketing Board liad completed selling of the*
main British West African crops. Stocks of cocoa in warehouses *
rose to 161,906 bags, from 153,772 a week ago, and compared with*
101,050 last year.
t

Coffee

involving liabilities of $5,000 or more rose sharply
twice as numerous as a
year ago when 86 businesses failed in this size group.
Little
change appeared among small failures.
181 from

Failures

138 last week and were over

increased

all

industry

and

trade groups except

wholesaling where they dipped mildly.
In retail trade, casual¬
ties rose to 108 from 81, in manufacturing to 39 from 28, in con¬
struction to 26 from 15, and in commercial service to 21 from 19.
More businesses failed than last year in all lines with the in¬
crease

and

mostly steady. Lard was lower de¬
spite further advances in live hogs which touched highest levels
since October, 1948, aided by higher wholesale pork prices an#
broad buyer demand. Strength in sheep prices reflected an active*
demand for native Spring lambs.
Cotton
closed slightly lower.
Trading was comparatively
quiet and price movements narrow.
Bearish

sugar

sentiment

were

was

influenced by weakness in securities

Reported sales in the ten spot markets totaled 39,900 bales^
the smallest for any week this season, as compared with 58,60#the previous week, and 69,500 in the corresponding week a yea**
Loan repayments on 1952-crop cotton expanded sharply dur¬
ing the week ended May 22.
The total at. 28,300 bales, was thos
largest for any week reported during this season.

Trade Volume Reflects Marked Gains

Holiday Week

from the

1952 level

particularly sharp in the trades and

services.

Consumer

debt

remained

Wholesale Food Price Index Strikes 9-Month Peak
wholesale food price index, compiled

by Dun & Brad-

street, Inc., moved sharply higher last week.
It rose to $6.56 on
June 2, from $6.47 a week earlier.
The current figure marks a
new high for the year and
the highest level since Sept. 9, 1952,
when it stood at $6.60. Compared with the $6.43 of a year ago,
The
of 31

was

index

2.0%.

represents the sum total of the price per pound

foods in general use and its chief

function is to show the

general trend of food prices at the wholesale level.

the

peak

reached

goods continued to account for

few

larger share of each

dollar than at this time last year.

The total dollar volume of retail trade in the week

was

•

■

esti¬

mated by Dun & Bradstreet, Inc., to be from 3 to 7%
higher than
the level of a year before.
Regional estimates varied from the

comparable

levels

year ago by the following percentages^
3; East -f 1 to +5; Midwest +2 to +6;
+4 to -f8; Southwest and Pacific Coast -j-5 to -f9 and the*.
Northwest -f 3 to -j-7.

New

England

-fl

—

South

Apparel stores sold slightly less than in the prior week al¬
though shoppers' interest remained quite high. Denim sportswear,
children's

clothing,, and casual shoes

were among the most popu¬
Men's slacks and Summer suits were sok2

lar items the past week.

rapidly than at this time last

The

total
a

year

that of

year.

receipts of apparel stores continued to top the fig¬
ago.

consumer

year

interest in household goods continued to sur¬

In wide demand were small air-condi¬

ago.

tioners, refrigerators, hardware, and decorating materials.
ging were outdoor furniture and picnic supplies.
While
in

the

buyer activity quickened

Lag¬

in some wholesale market*

period ended on Wednesday of last week, the total dollar
markedly from the level

volume of wholesale trade did not vary

prior week; it continued to be slightly higher than the yearlevel. The favorable consumer response in recent weeks en¬

of the

couraged many buyers to extend their commitments beyond their
immediate needs.

Department store sales on a country-wide basis, as taken fron*
the Federal Reserve Board's index, for the week ended May 30*
1953, remained unchanged from the level of the preceding week.,
the previous week an increase of 7% (revised) was reported
from that of the similar week of 1952. For the four weeks ended
In

May 30,

1953, an increase of 6% was reported. For the period
30, 1953, department stores sales registered an in¬

Jan. 1 to May
crease

of 5%

Retail

the increase

weeks ago and most retailers continued to stress easy credit
terntsv

above 1952.

trade

New York the past

week was adversely af¬

by such factors as cooler weather,
tended to keep shoppers at home, and the
fected

The

Despite

Although shoppers were as active as during the prior week**
one shopping day reduced the total dollar volume
oaf
retail trade slightly in the period ended on
Wednesday of Ias$
week. However, the year-to-year gain in retail trade was quite*
marked in some sections since the holiday week-end was
longese

ago

Casualties

(

worked moderately lower the past week. Tfc®
sharp declines in wheat discouraged traders and bakers and job¬

pass

preceding week, Dun &
At the highest level in any week since

from

Bradstreet, Inc. reports.
120

depressing factors in addition to Korean truce develop^-

crop were

ures

Business Failures Soar in Latest Week

11,

persistent rumors of the possibility oC

Wheat and
new

The

May

early truce in Korea.

Hard

in the like 1952 week.
Total

week

in grains continued, particularly in tin*

pressure

latter part of the week
an

consumer

Output Climbs 9% Above Week Ago

rise following the settlement oil labor disputes at Ford and
Chrysler, according to "Ward's Automotive Reports."
The industry turned out 110,387 cars compared with 101,466
cars (revised) in the previous week, an increase of 9%, and 92,956

trucks

Downward

cars

date last year.

last year.

total

cars, or

Passenger

confident these objectives

good regulation

week's

U. S. Auto

firmer

cfosed at 276.85 on June 2, compare#
previous, and with 294.90 on the corresponding

week

the loss of

12.9% above the corresponding week a year ago, and an increase
of

and

lation is provided.

Loadings Rise 2.2% Above Week Ago

preceding week.
The

ago.

Loadings of revenue freight for the week ended May 30, 1953,
totaled 786,755 cars, according to the Association of American
Railroads, representing an increase of 17,137 cars, or 2.2% above
the

irregular and uncap"*

and grain markets as well as continued slow export demand an#
the possibility of an early truce in Korea.

Higher in Post-Holiday Week

by the electric light
industry for the week ended June 6, 1953, was esti¬
8,096,330,000 kwh., according to the Edison Electric

Car

economy.

ethical effort
should be brought to bear on the
appropriate governmental author¬
ities to

the

The current total was 140,186,000 kwh. above that of the pre¬
ceding week when actual output totaled 7,956,144,000 kwh. It was
1,091,264,000 kwh., or an estimated 15.6% above the total output
for the week ended June 7, 1952, and 1,362,668,000 kwh. in excess
of the output reported for the corresponding period two years ago.

entitled to the protection
consistent with the great part they

small in

amount

This huge

are

play

that

announced

Institute.

to control the expenditure of

vestment

power

farther from

are called upon in
jurisdiction to regulate bil¬

Institute

The amount of electric energy distributed

and

Commissions

millions

Electric Output Turns

distance

none

individual

Steel

and

100.3% and production 2,262,000 tons. A year ago when the capac¬
ity was smaller actual output was placed at 254,000 tons, or 12.2%
of capacity, due to general steel strikes.

mated

socialism.
each

Iron

000 tons of ingots and steel for castings as against 99.6%, or 2,246,000 tons a week ago.
For the like week a month ago the rate was

day. But each day
it will be 24 hours

the

measurable
the

American

operating rate of steel companies having 93% of the steelmaking
capacity for the entire industry will be at an average of 99.9% of
capacity for the week beginning June 8, 1953, equivalent to 2,252,-

possessions. It will not

doing

closer

week were

by Dun & Bradstreet, Inc.,

magazine.

commodities last

tain with the general level of prices showing little change during
the period.
The daily wholesale commodity price index, compiledl

all

moment

strike.

Trends in

with 277.35

The extent that base prices will rise

consider

Industry

leading steelmakers and the union, states this trade

publication.

Before

which

Commodity Price Index Shows Little Chang**
For Week

The Problem of Rates

pense

Wholesale

jrom page 5

reasonable

(2549>

talks.

The result was an

the Coronation, whiefc

current wave of peaeo
estimated drop in sales volume of abou>

5% under that of a year ago.
According to the Federal Reserve
store sales in New York

Board's index department
period ended May 3^

City for the weekly

registered a drop of 4% from the like period of last year. In
the preceding week an increase of 7% was reported from that os.
?tbe similar week of 1952, while for the four weeks ended May 30,
*195$, an increase of 4% was reported. For the period Jan. 1 to
May 30, 1953, volume registered no change firom that of 1952.

1953.

The Commercial and Financial Chronicle

(2550)

and~ bond

With Hemphill, Noyes

j
'

(Special

to The Financial

Post

SIMPLIFIED

PROFIT-SHAR¬

ING

plan has been established for
employees of National Securities
&
Research Corporation, it was

NATIONAL

announced by Henry

J. Simonson,
President.
The Corporation
sponsors National Securities
Se¬
ries, a leading mutual fund.

SPECULATIVE

Jr.,

SERIES

The

A MUTUAL INVESTMENT FOND

created

anced

and Vz

New York 5, N. Y.

three

National

Series, % in Income Series
in Stock Series. Employees
contributions.

requires

The plan
actuarial work, it does

not involve life insurance and
no

has

fixed obligation upon the Cor¬

poration.

There is

Tax

come

Federal In¬

income of the retire¬

ment fund.

plan
has been sent to security dealers
throughout the country, since the

simplicity of such a plan should
appeal for many cor¬
porations, particularly those with
from 25 to 250 employees.
have great

Distributed with the retirement

plan is

ONE
WAlt

STREET

CIalvin bullock
GENTLEMEN: At
me a

*;*Jnewyork

obligation please send

prospectus on

Canadian Fund,

others.

The various forms needed

the operations

of the plan

are

reproduced.

Name.

Address.

ex¬

The

according

amendment,

the Board, makes it clear that the

regulation applies to loans for the
purpose of purchasing or carrying
certain shares issued by open-end
investment
sets

companies whose

as¬

customarily include registered

stocks.

The

City.

with

to these questions.

answers

THE FEDERAL Reserve Board

June 8 adopted an amendment,

affected

give

interest

the

into

trials.

equivalent
the

Dow

level

Indus¬

Jones

The economy ana the stock
look
better to
us
after-

vestor
is
likely to profit more
impending in 1951.
"In the professional investor's' from
developments in research,
new
products and new methods
mind, danger is associated with?
impending trouble; opportunity is- than from following the latest

associated

with

existing

trouble.

what

was

months

ago

when market averages were close
to

1953-54

period

only beginning in the three basic
price areas of our economy —

commodity prices, in bond prices
and stock
prices," Mr. Schreder

tions

the

(currently

50%)

loans

"Now
in

taken
are

carrying stocks

regis¬

1953

these

place.

While

apparent

correc¬

severe

basic

areas

the

have

declines

commodity

jority of people

now over

65 have

to continue working or find them¬

selves

dependent

whole

their daily

The

profit

The study states that time itself

miracles

investor

for

granted.

looks

opportunities

for

the

them.' If

prudent he will spread
and
be
guided

technical

his

investments

for

help the prudent person plan
retirement; that as an exam¬
ple,
$1,000
earning
3%
com¬
pounded

semi-annually becomes
years. It also con¬

$2,443 after 30
tains

"balance

planning

for

sheet"

each

liabilities' in

and

assets

retirement,

well

life expectancy figures for men
and women between the ages of

20 and 75.

The first issue of "The

View"

treated

and

with

how

retiring

NUMBER

well ;;as ..investment

know-how

before

risks

his

dollars."
CALVIN
letin

BULLOCK'S

described

the

June

Bul¬

Canadian

Fund's U. S. investments, dictated

by its policy of investing in com¬
panies, wherever organized, which
stand

benefit

ment

Canada.

Social

much

cites

the

by the develop¬
that

fact

American

oil companies operating in Canada
control more than half the esti¬
mated oil reserves, in a discussion
of American oil companies in the

years Cen¬
Fund's portfolio.
tury Shares Trust has paid quar¬
Other American companies with
terly dividends from investment
important holdings in Canada and
income at the rate of 10 cents per
owned by the Fund are Goodyear,
share and has distributed any bal¬
which owns 80% of its Canadian

BOSTON

Company

50 Congress Street, Boston 9, Mass.

ance

Funds.

alert

can

FOR

Name

modern

our

the financial

living."

against disease.

ordinary consumer," says
the Long organization, "may take

charity for

needs

weapons

"The

worth in dollars to people
after age 65.

Bond Fund
OF

newer

part upon relatives

(Security,

COMMON STOCK FUNDS

—

Long

3Te

ten

sponsor and mana¬
Diversified Growth Stock

AFFORD A

BOND, PREFERRED AND

me
prospectuses describing
Organization and the shares of your

-n

organization,
ger

YOU

person's

Custoclian Fundi

Please send

market index.

very

and skill will be rewarded."

present levels.
"Then serious adjustments were

chasing

your

move

In a bulletin entitled "Science
likely?
will continue to be a period in- Shapes our Future" just released
which
extreme
investment care to investment dealers, the Long

The

"CAN

curities, in a current study, com¬
pares
the stock market outlook

by banks for the purpose of pur¬

The Keystone

laboratory
and
investment
opportunity grows closer every
day, r says Hugh W. Long and
Company, investors need a new

ments

tne

these basic adjustments have ma¬ slant on what to look for in "fi¬
terialized than when we saw them- nancial news." The long-term in¬

com¬

stated.

Ripe Old! Fund, reviews some of the new
pany's underlying assets or their
Age?" is the question asked uy developments in the electronics,
equivalent. Such shares are
Hugh W. Long & Co., mutual fund chemical
and
drug
industries
technically called "redeemable se¬
sponsors and managers located in which represent about two-thirds
curities."
Elizabeth, N. J., in a bulletin deal¬ of the Fund's investments.
The action does not affect Reg¬
ing with the universally interest-;
One of these developments is
ulation
T,
which, among other
ing subject of life expectancy. "If the tiny transistor,
which will
things, forbids securities brokers
you live to age 65," the bulletin, replace
the
electronic
vacuum
and dealers to lend on securities
points out, "you're likely to need, tube in many uses.
7
*
fK
not registered on a national se¬
capital for a minimum of 12.4
Another
is
the .wafer-thin
curities exchange. Therefore, "re¬
years of living thereafter"— a. "plated circuit," which is begin¬
deemable securities" of open-end
minimum of 14.6 years for women." ning to supplant individually
investment companies cannot be
The bulletin—the second in a" soldered electric wire connections
given loan value by brokers or
series titled "The Long
*r
View"—£ in radio and TV sets.
dealers unless they are registered
Comments of civilian and mili¬
points out that if your living5
on a national securities exchange,
standards after age 65 require the* tary
experts,
reviewed
in
the
which rarely is the case.
expenditure of $5,000 per year," bulletin, indicate that plasties-^—
And, of course, this action does
that means you'll need to spend5 the "cheap substitutes" of yester¬
not affect section 11(d)(1) of the
about $60,000 for living costs dur-' day— could become one of our
Securities Exchange Act of 1934
ing the average life span after- giant industries with expanded
which prohibits a broker-dealer
mass
use in cars,
age 65.
vessels, planes.
from extending credit, or arrang¬
"If these figures cause you to- Pointing to the fact that "bugs"
ing for the extension of credit,
stop and think about your finan¬ causing
infectious
disease
de¬
on
any security which was part
cial plans for the
future,"—the velop resistance to older anti¬
of a new issue in the distribution
bulletin continues
the
bulletin
notes
the
"they will biotics,
of which he participated within
have served their purpose.
For continuing need for the drug inT
the preceding six months.
the unhappy fact is that the ma¬ dustry to meet the demand for

regulation
which prescribes margin require¬

Regulation

point

cash

with

Finally, there is a series of 48
questions which might be asked
by
employees concerning their
participation "in" the plan along

his

vert

232

market

a unique 30-page booklet
entitled, "Building the ProfitSharing Retirement Plan."
It
shows all steps taken by National
Securities & Research Corporation
from the origination of the plan
to
its completion.
Included are
the minutes of all meetings deal¬
ing with the establishment of the
plan, as well as copies of all cor¬
respondence with the Treasury HAROLD X. SCHREDER, Execu¬
Department, the Trustee bank and tive Vice-President of Group Se¬

occurred

Mr. Simonson said that the

national securities

assets, and carry the right to con¬

make

reinvested

Securities Series funds—Vz in Bal¬

Established 1930

the purchaser a proportionate in¬
terest
in
the
issuing company's

and

.w...y

tered

change.

the Corpo¬
ration of 10%
of annual profits
before Federal Taxes, is invested

RESEARCH CORPORATION
*

Fund,

Employees'

from contributions by

NATIONAL SECURITIES &

120 Broadway

By ROBERT R. RICH

Prospectus from your dealer

substantial* earnings in excess of the sum bf
in
the regular quarterly
payments

aiso

prices.
This is evidenced' will be distributed in the final
by the fact that during the period month of the year.
<■ ;
of
no
apparent change
in the
BECAUSE
THE
LINK
between
averages, 501 stocks have declined;

Mutual Funds

BOSTON, Mass.—Peter J. Carhas become connected with

& Co.,

1953

Thursday, June 11*

stock

ris

Hemphill, Noyes
Office Square.

prices,
has

correction

Chronicle)

Massachusetts Investors Trust

D-o/

sum

of
of

special
Owing to
rate

excess

of the

namesake;
International
Paper,
largest
newsprint
producer
in
Canada; Kennecott Copper, which
currently higher owns a % interest in Quebec Iron
earnings, and in and Titanium Corp., with the lar¬

quarterly payments
year-end dividend.

annual

....

earnings in
these

order to distribute

earnings some¬
evenly throughout the
year, the rate of the regular quar¬
terly dividend has been increased

Massachusetts Investors

pulp mill,
timber

what

State.

City

gest known iron-titanium deposit;

to 11 cents

Address..

Growth Stock Fund

the

share beginning with

dividend

declared

payable

June 26 to shareholders of record

June

16.

This
net

income

interest

clusive of

Century Shares Trust

As in the

payment

from

derived

securities

owned,

any

and
ex¬

Corp., whose Canadian
operations consist of a high-grade
a

chemical plant, and

tract

Montana

3.1

Power

million

Co.,

which

has

purchased the Pakowki Lake gas
reserves
in Alberta for $10 mil¬
lion.

Exploratory

creased

reserves

work
a

has

in¬

total of 400

billion cuv ft.

losses;

MRS
Canada General Fund
A prospectus
relating to
investment funds may be

A Mutual

the shares of any of these separate
obtainedfrom authorized dealers or

Investment Fund
Prospectus

VANCE, SANDERS & COMPANY
may

from

■■■*'

be obtained
•

investment dealers

111

DEVONSHIRE STREET

'I*

Berkeley St., Boston, Mass.

NEW

S;4

...

fS.. >

19 2 5*

YORK
,

♦FOUNDED

Broadway

r h o
*

★

120

Prospectus

upon request

LOS "ANGELES

;■ CHICAGO
South LaSalle Street

F*tnd-»

Investment

A. Diversified

ir~r' *'"

BOSTON

The" Parker: Corporation
200

iio

West Seventh Street

Lord, Abbett Set Co.
New York

acre;

"Experience developed over the
the' • Bulletin ' comments,
balance of'-net; years,"

capital gains

past

from

dividends

Marathon

-'.Chicago

; •

Atlanta

—

Loi Angelei

Volume 177

Number 5228... The Commercial and Financial Chronicl(

(2551)
"reemphasizes the logic of includ¬
ing in any well-rounded invest¬

securities with 66.2%

ment

stocks

and

stocks.

7.5%

program

U. S. companies

Canada

some

having substantial

interest in that country;7'

made

rate

300

over

individual
in

21.4%

common

something

broader,

What the

Fund

SALES

months

1953

Wellington

the

first

five

reported by

were

A. J.

On May 31,

1953, the largest in¬
holdings were as follows:
utilities — electric
15.0%;

dustry
public

Wilkins, Vice-President.
oil
12.2%; chemicals and drugs
for this period, he said,
merchandising
5%;
and
to
$24,627,000 largest foods 4.9%.
•
for any such period in the Fund's
With the payment of the 82nd
24-year history.
They represent consecutive quarterly distribution
Sales

amounted

increase of 17%

$21,069,000

the sales

over

the

five

months of 1952.
The

mutual

adding

executive

re¬

year

shareholders

rate

record

lem which condition your think-

has

at the
2,000 a

month.

latter

and they prefer an investment in

the

percentage

carried

revenue

common?

Wants to Know

through to

I have doubts as to the

test

management,

since there often appears to be

inherent physical characteristic of
a

ences"among ^ompanies^or^^cer"

causes the wide differences".
there is more Or is it an increasing percentage
philosophy is about regula- room for earnings growth. Who is of gross to common over a oeriod?
tion. Some analysts are groping right? In which stock would you
Maybe the best test is simolv the
for the answers to what is right put your money, and why? Can rate of
return being realized on

in^r
We

■

further want to know what

company which is earning a sub- tainly
normal return, since

your

paid twelve cents per share themselves, and

from investment income and three

fund

ported that the Fund this
been

June 30, 1953, the company will

have

gross

Security Analyst

cash and U. S. Government bonds.

RECORD

ing expense per customer, or other
such rates?
Or is it

preferred

is invested in corpo¬
and 4.9%
is held in

bonds

Continued from paqe 12

cents per

their

ital

your beliefs and
therefor may help them in

reasons

you help us to find the answer to
this basic regulatory question?

the capital invested

in the

enter¬

tant,

share from realized cap¬
gains to its shareholders to

date in
THE

1953.

thinking.

But

impor-

prise,
ment

how

well

the

manage¬

doing with the funds en¬
your beliefs are a factor in
Operating Factors
trusted to it. But we all know of
earnings prospects for your
The next major weak spot in cases where this result is in spite
stock.
Do you believe in a fair our analytical knowledge I have of rather than because
of good
the

GHOST

Elmer Tuttle is

threadingcharacterTn the"new ^alue rate base> with
INVESTORS MUTUAL, Inc., now
has more than 150,000 sharehold¬

booklet

cartoon

"The

T aid

Rekt

Plans " DubHshed bv Broad Street
'
PUDiisnect by tfroaa t>treei
Sales
Corporation, national dis¬
-

the

number of any
country, it was
announced ^Tuesday by Investors
Diversified Services, Inc., national
ers,

largest

mutual fund in the

distributors and investment

man¬

150,000 shareholder mark
passed by Investors Mutual

during the month of May, making
it the first mutual fund in the, na¬
ever

base
I.

ownership

to achieve such

Assets

these

which

broad

according to
the fund,, in

shareholders

proportionate interests,
exceed $450,000,000.

Corporation, a
stressing satisfactory

the

readable

NET

ASSETS

Commonwealth

223,591 at the close of business on
May 31, 1953. This represents an
increase of $12,118,735 over a year

jvhen the total net assets were

ago,

$50,104,856. The company has over
38,000 shareholders at this time.
Commonwealth's portfolio is

and

Elmer's

style

ghost

with

fixed

Dividend Announcement

BALANCED

different

ment'

Broad Street
-

The latest

things

85th Consecutice

EATON

which

■

included

Investing shares.
its

terms

the

National

Corporation
growth
policy. Broad Street Sales

stock
feels
be

that its

another

newest

"best-seller"

the

r,P)lm»TDri

£.u

uxxT

AS; A FEATURE, of the
Finance

Forum"

& HOWARD

CENTS A SHARE

and the courts, if necesWhat about so-called eco-

nomic

depreciation?

lieve

that

the

—

Women

series

Wednes¬

Today."
graduate of the

income

account

sumed each

year? If s0 how much
fight wdl you mal^e for it? If
not, what is wrong with the the-

How about fair

turn?

"cost

what

proach.

rate

disagree

you

so-called

Commerce

North¬

jored in banking and investments.
The forum meetings are very pop¬

re-

with

the

capital"
the

ap-

substitute

method which you recommend as

right?
Thp vaW nf

vnnr

J™,*

not

Divid?ni3

payr.b'? June

Dividend

of record at 4:30 P.M., June

ers

24 Federal

777/e

sharehold¬
15, 1953.

Street, Boston

Z fl?ud has

at^ry c°™"*
?5'fl: y°u cannot
us

:tor us, but you
'°{^ ®*^rts of do s0
informed
com-

c^inmns and orders in
reflect

other

their
™

the

coromission

ground of

and

its

fiscal

year.

PERSONAL

the

PUTNAM

PHILIP
National

Securities

joined

Research

Manager

•

bas

k.MITH

Corporation

FUND

Even with knowledge of the at¬

its

stii£

faced

selecting

stocks

Mr.

hrm
Putnam Fund Distributors. Inc.
50 State Street, Boston

Smith,

graduate of Ford-

University Law School, has

been

with

associated

T^"k

law firm

the

New

with

the
I

vestment.

urei. ent Plan Department, it was
announced by, Henry J. Simonson,

President.

management,

x„™

who

Jr..

v»r«

are

the

most
know

convinced
those

are

problem of
desirable in-

that

best

investment.

quarters at the Home Office, 120

New

York.

the

where

protection

know

for

others

quite
fifth and last topic,

easily into

which

The

Measurement

Ability of Management. There is
certainly general acknowledgment
managerial abilitv is an ima

secudty

its

and

the

criterion

Dortant

v»a4»tmv%

on book value, they believe that
the risk nevertheless is increased,

occasionally

value

prospects.

have

some

earnings

the

consider-

allowed

proach

the appraisal

man-

Perhaps our first point
judgment is how good the man¬
is for furnish¬

agement's program

vestment
,

dealers

information

ing

financial

an¬

alysts.
If

gocietv
•/

supplied with all the
want, if the President

good talk
luncheon
'

at the Analyst
or

due

dili

meeting, he is a good man¬
ager.
I think our second point of
judgment is personality.
If the
gence

bustles

lot, slaps

the back and calls him

inclined to give him

strong vote of confidence.
am

not trying to

underrate thQ

doing

stockholders?

bang-up job for
But more im¬

gerial ability that can be made?
How do you decide whether or not

Company at 2529 Russ Building,
San Francisco 4, California.

you

Prospectus

request—.

Dealers' inquiries invited

southeastern system last Fall.

your

subordinates are do¬

good job? Should we study
customers' accounting and collect-

ing

any>

management?

good

the question,

beSs

But

this

because my

premise is that the investor and
*iis representatives are not ade-

aga^ay
in

haveindicated

possible

some

sure

1
approaches

that you

can

but

be helpful

guiding us to better manage¬
appraisal techniques.

Halsey, Stuart Group
Offer Equip. Tr. Gtfs.
Stuart &

Halsey,
.

Co.

Inc. and

the

portant, how should we measure
management? Are there any quan¬
titative measurements of mana¬

the

triP over the properties of a large

are

facts

still

from

its community

ment

gives

his

by publlc and political leaders.
This was one of the outstanding
Depressions I gained in a week s

qualities of financial relations
personality, because I think
a good utility President prob¬
ably does need both. But on the
other hand, couldn't the quiet type
who perhaps is not as communi¬
cative with us as we would like

funds may

felt

company is

I believe that our analytical ap-

that

describing these
be obtained from in¬

Good management should be apparent in the esteem in which the

utilities, is not this a recognition

Managerial Ability

and

Wiy""777,

Cer-

etc.

two

Prospectuses

privilege,

to a ra^e increase application,
T*TbabS s01iae tests can be made
company.
Certainly this is the °* the investors
acceptance of
case in the form of a penalty for
y°u.r securities. If you raise your
bad management, if not a reward caPJtal a"d 7°}F
for good
a better basis than those of similar
6
ation

FUND

financial leadership

in introducing the over-

als0 may be revealed by the naindicated that ^ure and force of opposition, if

this should receive

COMMON

subscription

Even the Commissions and Courts

who

billing,

such

appear

good management.

leads

ly limited.

states

card

may

What*. does it tainly there are tangible evidences
stockholder?
of

game, we are

many

in introducing bi-monthlyor post-

by his first name and talks a good

STOCK

Accounting initiative

industry talk of

discussion

This

analyst

gentlemen have

with

pru-

you measure ***
mean to

President

you

management

the

agerial ability is usually extreme-

best

#-»

You

analysts

the practice, feeling that assurance
of a fair return on fair value pro-

the

lax

dent ec0n0my?

the

some

fair value is not only the law but

vides

resents

Satterlee, War- say that such may be the case, but
the past five they believe that when the latter
IT
»»rl 11
wAnlrA
Lin
»NAn/1
IttaI
L! aL
He will make his head- results in a relatively high return

Broadway,

furnished

whether the margin of safety is lines, outdoor plant construction,
thin, and if so, whether this rep- and other engineering innovations.

we are

& Stephens for
years.

the fact that

can we tel1 whether your the Joppa project, leadership in
transmission and distribution net- atomic research, high-temperature
work is under-built or over-built, boilers, high-voltage transmission

commis-

sion> court and legislature,

newly created Profit-Sharing Re-

<•/ 77)o4 ten

tempted

particular situation, or per- agement is in demonstrated initispic-and-span neighbor ative and resourcefulness, such as
gone to the other extreme, the conception and execution of

members.

new

The final word generally is said

titude

PROGRESS

suggest that the results of a
company be charted against the
industry performance except for

y°ur

man as a "good operator." What is
embraced in that term?
How do

by the courts, and we want to
keep informed of their decisions
which would affect you, immedi[^u!"
TOTAL NET assets of Investors ately or in the long run. I say thenStock
Fund,
Inc., mutual fund word generally is final, because
^
*
V-'
^
sponsored and managed by In- sometimes the legislature may get
vestors Diversified Services, Inc., in the last word after the court
increased
$6,502,519 during the has spoken. If there are any legissix months ending April 30, the lative measures introduced which
fund's semi-annual report revealwould affect the future earnings
ed today. The fund had net assets or quality of your stock, we cer¬
of $48,045,946 on April 30, as com¬ tainly want to know of their in¬
pared with $41,543,427 on Oct. 31, troduction and ultimate fate.
end

nolic^^^voi^mptfliiatnrv'How
P
s ■
Yu

ular and drawing large audiences.

Tjeorye

control of expenses?

treme, where the properties are those charts over the years and I
gold-plated at the expense of the am still waiting to see one where
investors? If so, how do we rec- the company in question did worse
ognize the fact? When is the point than the industry. The parts alreached when additional expendi- ways seem to exceed the sum.
tures become too much of a luxSome evidence of managerial
ury? We can Pretend some sem- achievement is apparent in the
blance of a judgment in a phys- prize awards of the industry such
ical inspection of your system as as the Coffin Medal, but I am sure
to whether you are a good house- that there are more well-managed
keePer> whether or not poles are utilities than the few who can be
leaning, wires sagging, branches so recognized each year, so that is
untrimmed, but perhaps your not an all-inclusive test.
economies here are justified in
Another field for crediting manbaPs

87th Consecutive Quarterly

start with the physical condition
°f the properties.. I don't believe
that any of us want to recommend
the securities of a company whose
properties are really run-down or
obsolete, but is there another ex-

y°ur

anH

the subject of "The

Investor

Sebel

be-

you

should be charged with the present value of the property con-

meetings held in St. Louis on four
a
^
successive Wednesdays, Harry L.
,a
Sebel,
Mid-Western
Vice-Presi¬ by keeping
mission
dent of Hugh W. Long & Co.,

Women

??.? rfrZhi!

western University where he ma¬

Quarterly Dividend

mission

booklet will

mutual fund field.
Ac1

ory?

booklet will rival

Investors

School

STOCK FUND
A

might

predecessor,
"Are
We
Talking
Your Language?" which told in

Mr.

29 CENTS A SHARE

estate—

flexible invest-

program

day, June 3

FUND

tells

how

have been with

addressed the seminar

EATON & HOWARD

enter¬

story of his widow's trials and

tribulations
and

of thls approach in the event
major reversal of prices? Do
you believe enough in fair value
to fight for it before the Com-

sary?

easily

non-technical

Investment Company totaled $62,-

Broad

Investing

taining

hold

currently

the

income.
In

The

tion

Street

mutual fund

of the fund.

agers

was

tributor

an element jailed The Significance of Opera- management. Perhaps" we""should
for current construction costs,, or ting Factors. Here again I plan make tests of rates of developare you afraid of the repercus- to pose a flock of questions. Let's ment of new business, or rates of
sl0ns

Chesapeake

11) $3,000,000 of Chesapeake

Railway
third equipment
of 1953 3%% serial equip¬

Ohio
trust

ment

trust

certificates,

maturing

semi-annually Jan. 1, 1954 to 1968,
inclusive, i
The
certificates
are
priced to yield from 2.90% to
3.75%, according to maturity.'
The issue is to be secured by

standard-gauge
estimated to
cost
$3,842,680: 226 50-ton high
side gondola cars and 400 70-ton
low side gondola cars.
Issuance
of the certificates is subject to the
authorization
of
the
Interstate
the following new

railroad

equipment

Commerce

Commission.

the offering
Pressprich &

Other members of
groun

Co.;

are:

Wm. E. Pollock & Co., Inc.;
& Co.; and Gregory 8c

Freeman

Son, Inc.

The Commercial and Financial Chronicle

(2552)

in Birming¬

tion died at his home

ham, Ala. on May 30. Mr. Wells
who was 77 years of age, had re¬

BRANCHES

OFFICERS, ETC.

Bankers

and

stock

(common

under

the

Texas

tired recently as

CONSOLIDATIONS
NEW

ton

$1,000,000),

and

under

sures

250,000
stock (par $20

$5,000,000,

CAPITALIZATIONS

week

MacLellan

this

meeting

was

second

an¬

nounced

dent

bank.

Hesuc-

■ceeds

Freder¬

ick

William

resigned from

Bank

Wildner

Bank

has

Castor

Baker

sota Linseed Oil

elected

Oil

Board

Oifice, it

its

Park

100

announced

was

June

Gil-

Trustee of the Flatbush

by N. Baxter Jackson, Chair¬

Mr. Rogers is a member of
the law firm of Rogers & Condon;

May 29 by
John S. Roberts, President of the

announced

was

man.

bank.

"Vice-President, Secretary and Di¬

*:•

>:■.

rector of Metal & Thermit Corp.;
Secretary and Director of Tin &

Company of
State member

Corp.,

♦

under the charter and title of the

Peoples Trust Company, according
to an announcement by the Board

The appointment of Charles W.
Buek and Joseph Pickard as Vice-

IPresidents

announced

was

of Governors of the Reserve

pany of New York,

The

tem.

June 4 by Benjamin Strong, Pres¬
ident of United States Trust Com¬

former

which is cele¬

joined the company after
graduating from Yale 20 years
«go, and has been an Assistant

Pickard,

1951.

Richmond,

Mr.

alumnus of New York

£or the past four years.
He is a
Director of Federal Machine
&
♦

the

was

9, William F. Cordner, for¬
merly an Assistant Cashier, was
appointed
an
Assistant
VicePresident. Mr. Cordner is assigned

turned

the

JManover
the

Bank

Board

New

Trustees.

1949,

4932, he

York

Mr.

by
Ne¬

University

1945,
in

and a Vice-Presi¬
9, 1952. Four new
Bank of Virginia
by the bank's board

meeting
They
are:

Richmond.

William

fices.
if

a special meeting on June 4
stockholders of the Southeast

the

State

Bank

Kansas

JBronx Savings Bank of New York
was

the bank.
of the

June

Nosworthy,

8 by T.
President of

numerous

are

holders

Mr. Brunie is President

ing the
surplus.

Empire Trust Company and

Director of

$300,000.

corpora¬

as an

new

Bank

1,000
stock¬

share, enabl¬

$150,000

appear

market

the

that

confident

has

point

really been sold out to the

stable base. The prin¬
cipal buyers needed at a time like
this are the commercial
banks,
which are usually a major factor
in the market. These institutions

of forming a

good

make

could

of tax ex¬

use

empt income but they are

scared

market and,
addition, their liquidity prob¬

by the behavior of the

conditions
them little to invest in this

lems

present

under

leave

Until

field.

the

passage

time

thaws out their bond accounts and
there is some run-off in loans, we

hardly expect that the banks
will be of much help in stabilizing
can

municipal market.

the

While

the

also

here

outlook is

encouraging because of the

not too

large supply of bonds in prospect,
we
should avoid becoming such
that

bears

confirmed

the

adjustment
should

substantial

very

ignore

which has taken place. We

that

remember

also

could change

business

the

outlook

rather drastically if
picture deteriorates

in the months ahead.

became effective May 29.
*

Oscar

Wells,

or>
-

•

attractiveness of preferred
stock dividends to those who pay/
The

regular corporate income taxes is
so

that

great

downward

ahead

years

exerts

this

for

account

pull

tax

In the*

factor

further

strong

yields.

may,

narrowing

the spread in yields over cor¬

ment

bonds., Such a develop¬
would, of course, substan¬

tially reinforce the view that pre¬
ferred- stocks
are
in a
buying
.

though, as in the case-*
of corporate bonds,1 we may not

range-even

able

identify

the

•

precise

situation

volume of corporate

years,

past J 20

the

•

stacked against a fair

were

deal for the investor in fixed in¬
securities.

come

there

reduced

borrowing. In

that event, there could

/I;

Persistently

de¬

clining interest rates, a rising cost
of living, and the impact of highly
progressive personal income taxes
combined to whittle away at the
to visu¬

which

substantially

Regaining Favor

the

Are'

Securities

Income

readily be

real

return

The

investor

bondholder.

the

other

the

stocks,

common

hand,

the recovery from
the attainment of

benefited

depression and

peaks in
business activity. The experience
yields. This would
with equities was so good, in fact,
mean
that
the
present market
that
in many instances
it pro¬
level is partially protected against
vided
a
complete offset to the
a general rise in rates.
loss in the buying power of the
spread from govern¬

narrower

new

bond

ment

balance, I believe that the

long-term investor is
take

entitled

dollar. /

investor

The

high

grade bonds only had his day from

constructive the fall of 1929 to the spring of
1933; but for most of the next 20
years, despite some uneasy periods
ignore the possibilities of some such as 1938 and 1942, the equity
further weakness as a result of investor enjoyed his innings.
aggressive
competition
by
the
Since the peak of the immedi¬
Treasury for non-bank money. ate postwar price rise in 1948,
moderately

view of the corporate bond mar¬
ket.
However,
we
should
not

Furthermore, we should not ex¬ however, there has been consid¬
pect the supply of corporate bonds erable testimony in the economic
to decline

abruptly because there record to the effect
undoubtedly a substantial vol¬ tionary forces
have

ume

bank

which

debt

could

that

infla¬

lost

their

It is true that the out¬

strength.

and would be refunded into long-

break

term

bonds

motion

were

at all favorable.

which
prices temporarily, but for

market

conditions

raised

the

Korean

buying

War set

spree

fair the last two years the correction
to conclude that good quality cor¬ has been quite complete and per¬
The basic reason is not
porate bonds are in a buying area, sistent.
difficult to discover. In brief, our
even though we cannot positively
identify the present market as one productive capacity and scale of
of those elusive buy points which economic activity has caught up
with the rise in the money supply
come along once in a decade.
In summary

then, it

seems

which took place
Preferreds Are in
As

usual,

ferred

the

stocks

Buying Range

expect

can

this country

built-in

market

the contrary,

interruption
tion

such

has

inflationary bias, but,

it takes a major
civilian produc¬

world

war

cre¬

prime quality ate pressures powerful enough to
good account of cause a persistent price rise.

stocks

given

that

established
no

with special variations for supply
and tax factors.
Industrial pre¬
have

during the war
long since been

trend

the

bond

corporate

pre¬

has

years.

themselves

corporate

widened since the first of the year
as

reflection

the

volume in
It appears

least,

the

record

issue

market.

new

that, for the time being

may

orderly

entitled to
It

markets.

pertinent to observe that long-

term

borrowing by industrial cor¬

porations has not been important

ket.

With

the exception of con¬ through 1952.
Even though it is
issues, there have been probably true that the citizens of
hardly any important industrial the United States will always vote
preferred stocks sold since the for inflation rather than defla¬

vertible

readjustment

March,

1951.

rates

in tion, when it is

began

consequence,

necessary

to make

choice, there is undoubtedly a
point of view on the

the spread in yields for industrial
stocks over bonds of comparable

subject in the present Administra¬

quality

tion.

than

narrower

has

different

For

the

first time

many

been

for

public utility financing, together

issues

with the insatiable appetite of the

attractive

finance

tion that lower yields will prevail
in due course. Although it is dif¬

ing the persistent loss of purchas¬
ing power suffered by all those
living on fixed incomes or hold¬

ficult to determine when the turn

ing claims to dollar assets.

will come, some

ures

currently.

The

high

volume, of

companies,
have
been
primarily
responsible
for
the
bulge in new offerings.
a

year

ago

corporations

capital expenditures programs be¬
gan to

level off. Internal

of funds continue
as

sources

remain high

reflection of good profits and

increased
it

depreciation accruals. If

reasonable

expect

that

former President; (plant and equipment outlays will

of the American Bankers Associa-

yields

during the past two
Moreover, there has been a
years because they have been in change in the inflationary bias of
bond yields has produced a gen¬
strong hands and there have been our government which influenced
erous
differential from the rate
only nominal additions to the sup¬ its decisions on major questions
on
governments. The spread has ply through the new issue mar¬ of
economic
policy from
1933
rise

rapid

its

alize
will

that

buying point.

will stop rising, it is easy

ferred

Corporates Look Attractive

The

About

capital from $700,000
to $1,000,000. The enlarged
capital

<lent in the Out-of-Town Business

—C.

per

the

stock, the Union National
of Charlotte, N. C., has in¬

creased

Assistant Vice-Presi-

■*>""1

yields

stopped losing liquidity and their

Through the sale of $300,000 of

Appointment of Charles F. Mac-

Bellan

$250

including the Home Insur¬
Company, Homestake Mining
•Co., Francis H. Leggett & Co.,
General Reinsurance Corp., North
'«$£tar Reinsurance Corp., etc.
ance

The additional
offered

addition

tions

basis,

comparative

expect

City, Mo.
approved plans to increase the
capital of the bank from $200,000

announced

tax
quite en¬
ticing, yet it is difficult to become
On

exempt

The election of Henry C. Brunie
to the Board of Trustees of The

Arthur

and despite the active
buying of fire and casualty insur¬
ance companies and a few
other
investors, prices have been stable
for only short periods of time be¬
tween renewals of the downward

The

Stanley Hayden,
Cashier,
Norfolk;
Howard Weeden Brown, Jr., Aud¬
itor, Roanoke office, and L. V.
Harrold, Auditor, Richmond of¬

circle of individual

wider

buyers,

De¬

Assistant

talion in the Philippines.
*

mond;

Lieutenant Colonel
in. World War II,
commanding the
"745th Anti-Aircraft
Artillery Bat¬
•

he re¬
elected

Louis M. Clark, Assistant
Cashier,
West Broad Street office, Rich¬

was a

Yale

elected

held

well, who joined The Hanover in
1932, is with the Plaza office. A
graduate

of directors at the June 5

Newell
has
been
Vice-President of The

war,
was

Cashier

June

officers

1942-45

Vice-President

dent

Sealy

elected

From

cember,

bank's

were
if

working in various

Assistant

Head Office.
*

Richmond

Following the
to the bank,

Assistant

Metropolitan Group of Do¬
Division

Grace

active duty with the U. S.

Navy.

June

to the

charge

Durham, N. C.
joined the bank on

Gordon

May 1, 1936,
departments.

regular meeting of the

Board of Directors of The Nation¬

mestic

office

and

Trust Company, of

Mr.

al City Bank of New York held

take

Fourth

become effective

having

Outlook foi Money
And Fixed Income Securities

President of the Durham Bank &

Welder Co.
At

will

Va.

bank's

amount

June

therefore,

During

July 1. He succeeds Paul Wright,
Jr., Vice-President, who is leav¬
ing to become Executive Vice-

Vice-President

Assistant

the

Streets

became associated
with the company in 1941 and has
an

William T. Gordon, Vice-Presi¬
dent of The Bank of Virginia, at

"University,
been

the

Co.

brating its 100th Anniversary. Mr.

since

Sys¬

Sinking Spring Bank is operated
as a branch of the Peoples Trust

Buek

Vice-President

location

doubtful,

will rise materially further.

cards

slide.

The Peoples Trust

Wyomissing, Pa., a
and Director of
of the Federal Reserve System,
Cerium Metals Corp., Chromium
and the Sinking Spring Bank, of
Corporation of America, GoldSinking Spring, Pa., an insured
.•sehmidt
Chemical
Corp.,
New
non-member, merged on May 25
"York Hanseatic Corporation, etc.

•Chemical

$400,000 to $500,000, the enlarged

the
are

to sell common stocks, thus
serving to curtail the supply if it
should become unwieldy. It seems

•

Minne¬

Alan

Mont, from

Savings Bank of Brooklyn, N. Y.

stock of $3,000,000) and

Company.

election
as a

mour

of the South Texas Na¬
of Houston, Texas

National

Falls

of Great Falls,

Bank

as¬

from

Yields

approaching the point at which
utility companies will pre¬

Fixed

much

Avenue

effected as

Great

the

tal

has increased the capi¬

market.

some

Continued from page 7

also

Hubert E. Rogers to the Advisory
The

of $100,000

issues

new

fer

stock to the amount

new

adequate,

appears

concessions

good

porate
Sale of

quality public

good

the volume of

distributed

Mr.

and

'/..'/

Bank

(common

of the Titanium Metals

Com¬

Trust

York

New

Co.

Lead

President

Vice-President

A consolidation was

Corp.
of
America
and
Nickel
Processing Corp., and a Director

-High Commissioner for Germany.
Chemical

Brooklyn,
is

National

eral Counsel to the United States
*

Harry C. Wildner to the Board of
Trustees of the Roosevelt Savings

Moik

who

election

of May 29

Schneider, Jr.

the

announced

has

Adam

President

♦

►.-•y

Director
and Treasurer of the United States
Chamber of Commerce."
•
tion in 1925 and a former

tional

the board earlier this year at the
lime of his appointment as Gen¬

Finance Corps.

the

-Schwa rz

pany

tour

in the Army

Presi¬

ftfagle,

recently

January 1951, until April 1952. He
held the rank of First Lieutenant

Alexander

in 1948. Mr.
completed a
army duty from

Secretary

Assistant

directors'

bonds

South

porting his death, said:
shares of common
"A native of Platte County, Mo.,
'each); surplus of $5,000,000 and
he was known in financial circles
undivided profits of not less than
throughout the country. He was
$1,000,000.
a
former Governor and Director
The
election
of
William
C. Department, Western Division, of of the Federal Reserve Bank of
An addition of $250,000, by the
Stolk, President of American Can the Manufacturers Trust Company Dallas, Tex., and was a Director
sale of new stock to that amount,
of New York was announced by
Company, as a
of the Louisville & Nashville RR.,
Horace
C.
Director of
Flanigan, President, U. S. Fidelity & Guaranty Co., has been made to the capital of
the First National Bank of Odessa,
on June 8.
Mr. MacLellan joined
The First Na¬
Baltimore, Md., Woodward
Iron
Texas, thereby raising the capi¬
the trust company in 1940 after
tional
Ban k
Co.,
Birmingham
&
Alabama tal as of June 5 from
$500,000 to
of the City of
graduating from the University of Power Co. He was President of
New York at
Chicago.
He was appointed an the American Bankers; Associa¬ $750,000.
REVISED

over

utility

the

Bank

National

stock

spread

charter

Chairman of the
the title of the Texas National
Board of the First National Bank
of Birmingham.
Associated Press Bank of Houston. The consoli¬
advices
from
Birmingham, re¬ dated bank will have a capital

News About Banks
NEW

the Union National Bank of Hous¬

.Thursday, June 11, 1953

/4eclme modestly and inventories

time.

some

not

Industrial years, there is actually some genu¬
outstandingly ine sentiment in favor of check¬

look

except

the

assump¬

buying at present

taken

field

the

Meas¬
mone¬

concessions from the yields of the

past year

appears

tary
policy
and
efforts
being
justi¬ made to control Federal expendi¬

fied

in view of the difficulty of
buying in quantity in the absence

tures

tration

further

inflation

active

In the

ferred
ket

case

new

issue market.

of public utility pre¬

stocks, the

continues

have

indicate

seen

that

the

'determined

recent

the

Adminis¬
to

avoid

type

years.

In
one
other
major
respect,
issue mar¬
and, in my fixed income securities look much
very
attractive better than they have for many
new

active

opinion,
offers
investment, opportunities.. The

years;

the/changed

yield. rela-

Volume 177

Number 5228

The Commercial and Financial Chronicle

...

(2553)

now prevailing. During
the past two years we have seen

tionships
a

substantial

between

closing of the

bond

stock

and

Continued

gap

Our

.yields,

and this

probably will go still fur¬
Compared with the situa¬

ther.

tion

which

through

existed

for

1949,

from

substantially reduced.

This does

imply that carefully selected

equities
ued

many

reasonably val¬

not

are

does

nor

stocks

suggest
that
not still attrac¬

are

tive for long-term investment. It
does mean, however, that the in¬
vestor can much more comfort¬

ably

afford

position

take

sheltered

the sidelines in fixed

income securities.
Even

though

abandon

ought not to

constructive

view

equities for the long pull, we can¬
not escape some feeling of relief
at no longer : being pushed and
shoved into common stocks by the
pressure for income. Relief from
a perpetually easy money philos¬
ophy causes some painful transi¬
tional problems; but it puts us
back in the business of doing a
balanced investment job for our
customers.- 'v V- ;.;Vl";;'
..' 'r,
•_
■

•

The government

market, helped by Federal Reserve purchases
Treasury bills, and reported acquisitions of the new 3}4s by

government trust accounts

well

was

able to stage

Grandpa Again

was

commercial banks has added volume to

and

the

banks decide
If

are

teaching

maldistribution

were

obtain

thereafter

our

cur-

inflation ist

to return to the gold standard
with gold at $35 an ounce.
1 Contrary to what many of my
but in their American compatriots believe, it

is simply arbitrary and made pos¬
sible for the time being by special

tanal

circumstances arising from World
War II. These circumstances en-

of the Financial Committee of the

from

Nations

about

the

able the United States to continue
to acquire gold at $35 an ouncg
the a"d to maintain the price level by

world's

increased

reserves

$9,150 million at

1925, to about $11,350 mil-

lion at the

end

1931.

^oney ancJ credit inflation while

This in-

represents an annual rate
3%% per annum which was not

doubt

infla¬

economy.

The Federal Reserve Banks have been buyers of

the

those wha

propagandizing:

collapse of

and

rency

and

the needs of the Treasury, and the

result

the blame

erroneous theories. The surest
way

Treasury bills
tightness in a very

w*at t0 cal1 *•

generally accepted
rate of growth of produc-

normal

money

the

market. This, along with reported small pur¬
long-term marketable obligations for government
trust funds, helped to turn the market for these securities in the

and

trade

countries

consider

relevant

the

H remains to be

the price of gold

gold-using

while

wholdu

first

s.^

lower than the

tion

crease

some

capital investments), the NaCity Bank mentions that
according to the Gold Delegation

the

end of

alleviate

is not the dollar which gives value
to gold. The price of $35 an ounce

authorities in what they have been attempting to accomplish. It is
evident that the future trend of the government market will de¬

not be evident in the

the part

(due to disequiunderlying trade

librium

may or may

and

should

now," says the National City
Bank) lay not in any overall lack

gold

pend upon the policies of the powers that be, which will

there

To prove that the trouble ("then
-as

;>■■■

enough so that the levels which

it.

psychological reaction

con-

govern¬
.

central

inflationary

—«

will have to be put

League

chases

time

of gold was the specific
remedy to the situation, but the
governments and experts did not
see the light then.

of monetary reserves,

new
••

evitable about inflation. We have
inflation
when
the
government,

with the
that

•

price

reached in the sell-off will be maintained in the future? To be
sure there is no immediate answer to this question because it will»

restricted

off

flagration." There is nothing in¬

of the average person
of a markup of gold,

market which has been

Long Bonds at Low Point?

tended

set

have

The most important question in the money markets at this
time is whether or not prices of long-term government bonds in-

has

lars and sterling. A change in the

similar fashion to

point. Uncertainty is still a very prominent factor in the
ment market despite the rally which has been witnessed.

tionary tendencies that

"such action could be the torch to

in
-

gold shortage but the gold valuation of the

active but nothing to get excited about yet from that stand¬

take into consideration

not the so-called

was

even

the recent decline went low

—

wrong

situation

monetary

though the powers that be had to make
purchases of the nearest maturity to bring this about. According to
advices, corporations with funds were buyers of Treasury bills
as well as the tax anticipation bills.
Tax switching by some of the

Are

done

was

place. What

element, should also be given

The short-term issues also responded in

which

been
:—

to recognize in the gold
price the inflation that had taken

big assist in this operation.

have

markup of gold and it states that

seriously inflated amounts of dol-

dealers and traders, the professional

the rest of the market

1925,

sizable rally from the new lows that had been made just a short
time before.
"Open Mouth Operations" and short covering by
a

should

moR

companies, dealers and other investors,

ance

What

reports of scattered but not
takings of the longest marketable bond by life insur¬

too sizable

sterling, and the postseriously inflated price level,

war

take time to find out if the sharp decline of about a week ago
which carried most government issues down to new all time lows
was of sufficient magnitude to satisfy the desires of the monetary

Harold Smith Is

The Fiice of Gold
dollars and

the

example,

Governments

page

By JOHN T. CHIPPENDALE, JR.

1947

incentive to buy equities has been
not

Reporter

from

*?dl.vldufla*
^,
a
e to knovr
whether

seen

will be changed

still masters of the

are

situation, or by a chaotic route,
pertinent The time to change the price o£

this argument
because

ir-

gold is not after

opposite direction. There was also some aid in this operation from
the purchases by dealers and private investors
(evidently life

figures

insurance

1931, and second, the National monetary order and to prevent a
City Bank should have compared severe and prolonged depression,
the annual rate of gold production If, without further waste
of time^
with the rate of growth in value we plan
carefully the restoration,
of the social product.
of the international gold
standard*
This
job
was
done
by
Per a price of $70 an ounce would

companies). These latter acquisitions were not large,
according to advices, and were more of a position rounding out
nature to fill in some of the 3V4% holdings that were not com¬
pleted at the time the new bond was offered publicly.

Divergent Opinions Cited

Harold B. Smith

B. Smith, Pershing &
Broadway, New York

,> Harold

Co.,
120
City, is a grandpa again. A daugh¬
ter, Lorraine Pratt Smith was born
June

Irene

Harold

and

sister, Deborah
May (four in June) is almost as
thrilled as grandpa.
Smith,

Jr.

Her

tween

duced

there

(Special to The Financial

portant proportions.

Chronicle)

LOS ANGELES, Calif .—Howard

Seventh
Los

Inc., 210 West

members

Street,

Snedicor
Davies

was

Co.,

previously
Daniel

the

Angeles Stock Exchange.

recession that might come from here on in will not be of im¬
It is being pointed out that the downtrend
in prices of Treasury obligations has been sizable enough to prevent
the selling of these issues in order to get funds that would be used
to make loans that could increase the inflationary pressure. Also
the opinion is expressed that price declines from the recent lows
would not accomplish a great deal more than has already been
any

T. Snedicor has become affiliated
with Fairman & Co.,

those who hold the opinion that
market has about run its course and

are

Mr.
with

Reeves

Co., and Dempsey-Tegeler & Co.

done.

confidence and psychological factors have been badly

The

shaken by the rapid and sharp decline in quotations of government

been

from

a depression bast
set in. Our aim must be to restore

1925 to

rightf in New York a probably, accomplish what
Per Jacobsson com- seek. If, on the other

puted that in 1913 the relation be-

able deficit to

finance, then the outlook, according to some money
followers, is for higher interest rates, both in the short and
long-term sectors. This group is of the opinion that long-term
interest rates will go to the 3V2% level if not even higher before
the Treasury is through with the financing of the deficit.

have

few years ago.

market

On the other hand,

would

1929 and not from

Jacobsson

If the pressure is to be continued on the money market as it
has been in the past, and considering that the Treasury has a siz¬

the decline in the government

Joins Fairman Staff

1914 to

the amount of newly progold available for monetary

increase

million)

($250

purposes

national

the

($2,7°° million)
while
was

was

the

and

income

19^

1 to 29 ( gold $230

11,

natl°"al

increase

nf'tbe
million). One of the causes of th
change

the just mentioned re-

lation

was

higher

price

1913

and

cost of

the

precisely

level

at least

45%

1929 than m

60%

of the
will

rise

the

living. From these figures

production measured in the 1913
price of gold in terms of dollars
or
sterling contributed less to

brought about in the

changed

of gold

chaotie

may reach

indeed

abnormally high level.
Ladies

and

Gentlemen.

the lack of

3ense of
urgency for positive action shown

by a11 g°vernments

despite omi-

nous

Sympt0ms in the international economic situation. It
is our

duty

shou{. from the top of our
vojces the dangers ahead if
we da
not act
promptly,

intelligently and

wjth courage,

sustaining prices in 1929 than in

of limiting the creation of credit.

situation, the price

route, and it

to be masters

cease

plain that the current gold

obligations and it is believed further recessions in places of these
securities would do more harm than any good which might be
way

million' struck by

million*

w®

hand,

wait until

Halsey, Stuart Group
Offer Gulf Pow. Bds.

1913.

Substantial Tax

JJ. S. TREASURY
STATE
and

Switching

According to reports, there has been a fairly sizable amount
switching among the commercial banks especially those
that operate outside of the large money centers.
These banks, according to advices, have been moving out Of the
securities in which they have losses and replacing them with issues
that have the same coupon rate and comparable maturities. It is
believed there will be an increase in this kind of operation as the
year goes along.

tax

institutions

Appeal to Washington
is

SECURITIES

indicated

the

among

largest

that

the

owners

smaller

deposit banks, which are
the outstanding marketable longthat have shown the largest price

going to be done in the future to stem the decline in prices of these
about

a more

According to reports, these institutions

are

concerned

further hardening in interest rates because it would have
adverse effect upon them

than

upon

the larger banks which

have the short maturities and have been helped by the loans they
have made at advancing rates of interest. This is a situation that is

getting considerable attention, according to advices.

Aubrey G. Lanston
& Co.

(Special to The Financial Chronicle)

INCORPORATED

15 BROAD

ST., NEW YORK 5

WHiteball 3-1200
231 So. La Salle

St.

45 Milk St.

CHICAGO 4

BOSTON 9

ST 2-9490

HA 6-6463

With Reinholdt & Gardner
ST.

LOUIS, Mo.—Joel W. Pope
Triplett have be-

and Thomas B.
come

associated with Reinholdt &

Gardner, 400 Locust Street, members of the
west Stock

Two With Standard Inv.
(Special

to The Financial Chronicle)

LOS ANGELES, Calif.—Richard
H. Rue and Michael J. Flannery
have
become
affiliated
with'

gold price would add to the moner.vxxxxvxvv

Mid- forniq, 210 West Seventh Street,
Mr. Pope Mr. Rue was previously with Hill

previously with Olson, Don- Richards & Co.; Mr, Flannery
nerberg & Co., Inc.
with Holton, Hull & Co.

was

v—

potential for inflation.
It is a strange phenomenon that
the
same
persons
who express
freely their worry about potential
inflation due to a rise in the price

$7,000,000^ Gull
mortgage bonds,
4Vs% series due June 1, 1983, at
101.295% and accrued interest, to
A new
yield 4.05%, is being made today
(June 11) by Halsey, Stuart & Cck.
Power

Co.

first

i—;—•

—j-

Award of the

issues

the group at
June 9 on its

was

won

competitive sale
bid of

gold do not raise their voices

by
on

100.55%.

The

bonds

will

redeemable

purchased by the Federal Reserve

ranging from 104.30% to

is inflation of the

purest sort.
First of

all, there exists no nec¬
uniform relationship be¬
tween the value of gold reserves

essary or

and

the

amount

mand. Since 1940

effective

have inflated

de¬

supply more than three
despite the fact that we
maintained the price of gold at
$35 an ounce and without any
substantial increase in our gold
reserves. Second, if the profit of
gold revaluation is allocated to

our

money

times,

amortize the debt of the

govern-

5aen_t t°ward the Federal Reserve

■*

Inc. and associates.

against the continuous increase in
amount of government bonds
Banks, which

■*--

regular

redemption

prices

par, or i£

they are redeemed through the
sinking fund or the maintenance

fund, at special redemption prices
ranging from 101.30%J to par, plus
accrued interest in each

Gulf

Power

Co.

case..

engaged,

within the northwestern sector of

Florida,

in the generation and
distribution of electricity, and in¬
cident to its electric business, the
sale

served

appliances. Territory
directly and indirectly by

the company has an area of about

7,400

square

miles

and

esti¬

mated

population of more than.
280,000. At the close of 1952, the
number

electric

customed

.jBanks, the potential inflationary served directly was 62,120. OperStandard Investment Co. of Cali- consequences; of the rise m the ating revenues of the company tor

New York and

-Exchanges.

Bank
in the

the

term obligations and the ones
depreciation, have .put their' case before some of the important
political figures in Washington in an effort to find out what is

securities.

City

National

that the markup

tary base and provide an enlarged

MUNICIPAL

The

(2)

contends

Offering

was

price
of gold
neutralized.
The National

the

are

completely

aggregated

City Bank stresses

psychological

the 12 months ended Feb. 28,1953,

effects

come
come

was

$7,993,000; gross in¬
$1,928,000 and net in¬

$1,833,000.

The Commercial and Financial Chronicle

(2554)

load

Salesmen Have Become Lax

During the past 12 years, salesmen
and
sales
managers
have
tended
to
become lax
in their
attention is

now

the field.

deserves

which

problem

of what

this
serious

another phase of

The proportion of such'
tures wl11 vaiY wlth each com~

IslSTas 'the growth 'o'f "vou
that there has been

revenue

general

decline

pense per

in the

Hniiar nf

sales

will then be able to deErmine what the earnings would

bave befn lf ther® bad

ex-

<rrn«

Every effort should be put forth
increase sales efficiency by a
study of methods used effectively
to

other

which
too

War

You

prior

In many cases mass

form

one

duce

another

revenue

be found far
present condi-

selling

will

pro-

dollar of

per

sales expense.

tremendous

sales

increase

increased
you

expressed in
to remain
at the present low figure.

sales.

guide
you

pUf

50%

will

give

to the
profitably
your
sales

jnto

sell

order

for

service,

allies

the

customer's

dollar.

Regardless

Other

effect

ment

advertising and find that mass
production makes it possible for
them to spend
proportion of

larger and larger
their revenue in

sales effort and at the

of whether

Building

then, is the first phase
Building Profitable Load.

suggest that each

home, take out

for

report

one

which

customers "can

make in electrical appliances each

year,

incumbent

upon

the

committee

will

result

from

way

of illustration

I would

submit

figures

few

Retail

Add'l Ann'l

Cost:

Kwhrs.

Price

Revenue

1100

$316.00

$19.80

16.0

100

3600

150.00

36.00

4.2

155

Ironer

100
100

Conventional Washer

Electric
*

The

above values

mate

has

Blanket.

only
been

calculated

kilowatthour

for

66.0

1.00

285.0

153.00

0.10

1530.0

130

41.00

2.60

15.7

washer replaced.

approxi¬

influence

per

appliances

except water heaters which have
been calculated at 10 per kilowatt-

hour.
the

The

calculations

made

above basis will vary

dependent

widely

local vari¬

upon many

ables.
A similar

get their assistance
the
market
for
appliances which have a

broadening

those
low
I

ratio of

very

can

study on lighting pro¬
interesting results. If

induce

commercial

cus¬

tomer to replace at 100 watt bulb
with a 300 watt bulb, the custo¬
mer's increased investment is

trical

$0.66

and

year

2500 hours per
per
kilowatthour

upon

is $10.

first cost.

full

industry is to approach its
potential

dealers must

and

the

few

manufacturers, distributors

years,

level to

at the

increase

public ac¬
ceptance of the new appliances.
An adequate job cannot be done
within the sales budget of the op¬
erating utility.
Second Phase of

Building

Profits
This study and the action which
results from it constitutes the sec¬
ond

phase of Building Profitable

An analysis of this type will en¬

Load.

able you to give more intelligent
direction to your sales effort. In

many

companies

ing lighting,
for

some

our

the

are

neglect¬

original market,
newer

and

glamorous applications.
With a limited budget, you can
direct
greater emphasis to the
promotion
of
those
appliances
which have a higher ratio of rev¬
enue to original cost.
This infor¬
mation is also useful in discussions
with',

manufacturers,

have

toward
fixed

(1)

home lighting
new importance

suggested technique.

there

in the

question

any

minds of any of you as to the wis¬
dom of a controlled
approach to

provided a relatively year period, Or an average of 155
As a result the cus¬ kilowatthours per year. '
turned the lights on only
In the five years from 1947 to
daylight failed either be¬ 1952 the kilowatthours per resi¬
of nightfall or because of a dential customer increased ffom

lighting

low intensity.
tomer

when
cause

storm.
As a result we had the 2319 to 4106, an increase of
1787,
lighting demand but sold rela¬ or an average of 357 kilowatt¬
tively few kilowatthours.
1 - hours. This is an accomplishment
If fluorescent lighting is used so;
outstanding that it deserves
to
replace
incandescent
equip¬ further study.
•
k •
t
ment
on
a
fixture
An
per
fixture
analysis of the
monthly
basis
or
even
to
produce only sales
by
classes
of
customers
double the intensity, the use of shows that whereas the sales were
lighting remains unchanged. How¬ fairly uniform throughout the year
ever, when fluorescent lighting is in
1942, the variation between
installed to provide an intensity Summer and Winter in
1952 is
'

the

shape

the

load

Rural and metropolitan char¬

Variation

between

compared to

use

area

Relative saturation of various
types of appliances.
Special inducement
time

some

the

factor

inherently

high load
appliances such as
coverings or
attic

Other

factor.

bed

rates

fa¬

day

load

the

factor of any

appliances

system. Other
their own load

have

characteristics

year.

and

widely

vary

from another.

at
a

taken

curve

time of peak is important but

study of annual load for various

hours

the

day will be helpful.

of his company's daily and annual

load

curve

determine

can

ad¬

the effect of any individual

vance

appliance

the load factor of

courages

the

of
be

This method

year.

approached
the load

cause

with
curve

should

caution
is

be¬

changing.
A number of years ago our own

found that there

company

definite
load

valley

summer

curve.

the

was

the

generating ca¬
pacity that will be required to
serve that appliance. With this in¬
simple
net

lower

and

variable

the

trend

investment
toward
costs

the

pro¬

duction of electrical energy. This
trend causes load factor and its

improvement to become
major

one

responsibilities- of

of the

,sales
I;y
have followed the practice* for
a

manager.
I

many years, of having the
men,

in their

snare

profiles

drafts¬

and

return

determine

the

appliance

the

increment
V

Relatively little information has
been available

the load charac¬

teristics of various appliances and
for the purposes of this presenta¬
tion

the

information

collected

been

modifications
in

this

rate

tion

its

been

it has not

entirety

large

increases

would

because

incur.

many

customers

which

the

over

has

years

This appendix h£s been entitled

word

cluded

"Rough"

because

heating

resistance

stresses

this

house

has

in¬

been

point

and

extent.

some

The guide does not cover all ap¬

pliances

and the information on
companies to
'some of the newer appliances iis
adopt rates which will be com¬
somewhat less reliable than that
pensatory under all conditions.
the

urges

member

The sales manager has the
portunity and therefore the

op¬
re¬

sponsibility to influence the load
factor by a study of the daily and
load

seasonal
company

curves

his

own

with respect to both

and

typical

sys¬

distribution

feeder.

others

examination

these

load

curves

will indicate those periods

of the

day

year

were

which to draw
After

fewer

num¬

available from

conclusion.

selecting this

subject for

presentation at this meeting, I

was

most interest in the announcement

which

Mr.

Clarence

Linder

made at the Annual Sales Confer¬

of the Edison

ence

because

ber of studies

tute

Electric Insti¬

Chicago this Spring.

added

Some
may

ple,

system

which

relatively obvious. For
the company serving

study
exam¬

in¬

Until

such time as a complete
is available, the data con¬
tained in the appendix should be

study

substantial

have

assistance

allowed

less

that

the

rate design.

proper

sult,

the

house

load

saturation

re¬

electric

heating reached between
10% in 1952 with devastat¬

8 and

ing results to system load factor.
Any sales manager who permit¬
ted

situation

occur

similar

this

business-managed, tax-

paying utility would have sold' his
into receivership.

company

Keeping Load Factor in Balance

.A similar situation,

much

smaller scale, and less pronounced
in its effect is developing in many

utilities where, due to lack of in¬
formation, pressure from the man¬
ufacturers

part of

building
produce
,

or
prejudice on the
sales manager, the load

is tending
lower load factor.
I

program
a

The situation in any utility sys¬
never
remains static.
It is

tem

constantly

changing.

One

appli¬

ance

may produce very desirable
characteristics this year but two

from

years

now

have

may

much greater peak

responsibility.
By constant careful analysis of

load conditions

sales

his

own system
typical
load

various

manager

less

reference

appliances,< the
shift

can

the

em¬

appliance having

one

favorable

one

having

favorable load characteristic.

Opportunities for load balanc¬
ing for improved load factor are
also 'present in the industrial and
commercial

ditions
fields

classifications.

vary

that

widely

difficult

Con¬

these

pre¬

pare any generalized data.
Fre¬
quent opportunities for load fac¬

tor

improvement will be discov¬
ered if the sales personnel
dealing
with such customers are

fully

quainted with the

ac¬

program.

Selling for improved load factor
is the third and final
phase of this

discussion,
Load.

Building Profitable
*

Joins
(Special to

those

King Merritt
TSe

Financial

^ LOS ANGELES,

liam

sociated

ances.

of the conclusions

was

parts

grow without direction and with¬
out

in which load

be drawn from such

Certain

system, notably Memphis, have at¬
tempted to discourage house heat¬

announcement concerned the pro¬

without

either.

1%.

This

posal
of
the
General
Electric
increasing Company with respect to a com¬
distribution system peak or sys¬
prehensive
studv
of
the
load
tem
peak or without increasing characteristics of various
appli¬
be

can

The saturation of elec¬

heating in 1942

itijs not intended phasis from,

to be

issued

than

and

Characteristics."

night load the
appendix is complete nor that
reasonably safe but future research on the
subject
seasonal
concessions
are
always
may not alter the-data presented
dangerous. The report which EEI
has

TV A.

curves

The

The
288.8

was

you probably real¬
system referred to is

ize that the

Residential

Load

July.

July.
By this time

"Sales Manager's IRough Guide to

that the information contained

Concessions to build

appear

information available.

have

but

226.6 mil¬

81.1% high¬

million kilowatthours higher than

the

been possible to correct the situa¬

are

daily

the

from

revenue

building summer
the growth in refrigera¬

made

time, cut out

the

matter

disposal

is
included in an appendix to this
load but
paper, which is now available in
tor saturation and general accept¬
print. At this point I would like
ance of air
conditioning have in¬ to
express my sincere appreciation
creased
the
summer
peak to a to those who
hav£. cooperated to
point just below the winter peak. make
this
effective

was

and

relatively

his

investment.

time

same

hesitancy among the
large stores to install
air
conditioning equipment be¬
cause of the high
operating cost.
A special summer off-peak rate
was

in distribution and

constantly formation

sales

ing, but other components of the

shape

The annual load

the

Residential

were

kilowatthours,

than

condition

in the resi¬

classification.

tric house

improve

of the daily load
The
sales
manager
who
is
throughout the year equipped with a knowledge of the
but the shape of this curve at time
shape of the load curve of various
of the annual peak is most impor¬
appliances and has made a study
tant.

lion

the

will

and

this

sales in December

fans by their very nature operate

varies

curve

although

most pronounced

was

dential

total sales in December

A few appliances such as clocks

one

The

load

Summer

off-peak

(5)

improved

kilo¬

and customer satisfaction.

electric

time.

sun

evaluated upon the

the sale of additional

operate

Relation of time in

industrial,
laundry lighting

not

very pronounced. The sales to all
classes of customers in 1952 were

higher in the Winter than in /the

commercial,
and

watthours,

seasons

the year.

the
the

basis of connected load but rather
upon

acteristics.

(4)

kitchen

should

trial load.

(3)

Thus

which in-

Proportion and type of indus¬

tem

considered

higher

costs

distributors cardboard

study

The

whereas the gross revenue to the

utility based

revenue

firmly believe that if the elec¬

local

duces

could

are:

curve

Some

and dealers to

all

3.10

285.00

revenues

are

electric

and

204.00

50*

100

In addition to conventional

EEI

of the factors

few

there

Annual

Automatic Washer.._

cases,

problem and recommend a
program of load promotion that of 60 foot candles or more,
would improve the load factor of
lighting is in use whenever
each member company.
space is occupied.

owners

Water Heater

promotion

sales managers who wish to adopt
this

as sys¬

such

advance the increment investment

which

probably appliances:

Range

the

concerned.

additional load at some
period of the day or some season

financial

Load

distribution feeder and of the sys¬
tem.
He can also determine in

you

% New

off-peak load insofar

tem

utility to make

sales manager of a

your

Appliance—

lighting

One way of improving load fac¬
tor is to design a rate which en¬

You

1952.

to the invest-

our

the use of the appliance. In makj,ng thjs study consideration must
^e given to percentage of sales
that will replace older models of
the same appliance.

Load

This,
of

definite limit

revenue

rrontabie

reduce the real cost of the product
to the consumer.
First Phase

morning peak

residential

study of the retail cost of various
appliances and the electric

time

same

ben¬

net

the

for

appliances is high and since there

cost

earnings and
any new load which tends to im¬
prove both
load factors will be
most profitable.
If all utility systems had the
same type of load curve the solu¬
tion would be relatively simple.

industries have learned the value

system which
of generating

either load factor will have

voring

for

the

and

(6)

energy

its operation.

other in-

gram

season

field

investment

Any load building pro¬
which
tends
to
improve

eficial

must

equipment

the

facilities

the

influences

product,
some

industry

electrical

uses

factor

com-

the

with

that

are

facilities.

busi-

our

for

our

appliance

some

which

load

(2)
that

market

distribution

cooking, pany engages in the merchandiswater heating and clothes drying ing of appliances or not, the major
is keener than at any other time function of its sales effort is to
in our history.
Even more im- create a demand for an appliance,
portant is the other competition
The first cost of many electrical

dustries

area

consulted very

are

influences

which

can

peculiar aspect of

our

expense,

forget.

have

terms of gross revenue,

The competition from

that
f0

better

amount

affor(j

electric

al-

substantial

sfmpie matter to study the effect

ness

not

will

the most of them

make

low

that

been

-decline in net earnings,
with this information

One

opportunities which lie before us in this great industry are
The

have

may

under

costly

tions.
in

effective

were

World

Methods

industries.

sales and no sales ex¬
w.n f.nd that

increased

rpvenue
dolar of gross revenue

penge

llnJf

bee1r| ®

sales activity were carried on.

following the start of World War
II some sales budgets were cut.
™

where they

kept

are

20uld not be eliminated ®^en

period

the

During

rnn«?idpration

models

These

curve.

curred if these sales had not been
made.
In the analysis of your sales
expense you will find that much

given to this matter and
within a relatively short time a
hard hitting team will be back in
being

There

load

dustrial

will find

Thursday, June 11, 1953

this- matter
readily should take on a
of
load
building, I
because
profitable lighting load would like to recount the history
planning a sales can be added without increasing of a major electric system.
gross
small
increase
in
net
earnings. program or in appraising the re¬ the peak.
In
the five-year
*
period from
The advent of fluorescent light¬ 1942 to 1947 this
^o
determine the effect of in- sults of past sales programs.
system showed
In
the
improvement of load ing provided a great opportunity an increase of from 1543 to 2319
creased sales, deduct from the
figures
the
revenue
from in¬ factor we have two types of load for utilities,, the importance of kilowatthours per year per resi¬
There is the which has not been fully recog¬ dential
creased
sales and the expenses factor to consider.
customer," an increase of
which would not have been in- load factor of the particular feeder nized in all circles.. Older types 776 kilowatthours over the five-

will find

program.

Much

sional

then

are

substantial increase in accessible and
revenue
but a relatively frequently in

through an active sales

methods.

curves.

profiles

Building Up Utilities Profits
corrected

These

daily load
assembled in
such a manner as to produce what
might be termed a three dimen¬

Continued jrom page 7

Lawson

Calif/

has

Chronicle)
—

Wil¬

become

as¬

with

King Merritt
&
Company, Inc., 1151 South Broad¬
way,. He was
formerly with Revel
Miller &

Inc.

Co., and Reagan & Co.,
v

Volume 177

Number 5228

The Commercial and Financial Chronicle

(2555)

The following statistical tabulations

Indications of

latest week

Business Activity

week

month available.

month ended

Latest

AMERICAN

steel

Equivalent
Steel

operations

(percent of capacity)

gallons

(net tons)

§99.9

June 14

"99.6

100.3

§2,252,000

"2,246,000

2,262,000

6,359,950

6,276,150

6,983,000

6,949,000

DEPT.

PERMIT

AREAS

of that date:

output

(bbls.)

—May 30

23,614,000

23,143,000

23,322,000

17,751,000

output

(bbls.)

May 30

2,518,000

2,296,000

2,674,000

9,868,000

9,840,000

10,012,000

7,758,000

output (bbls.)
May 30
Stocks at refineries, bulk terminals, in transit, in pipe lines—
Finished and unfinished gasoline (bbls.) at
May 30

8,564,000

*8,348,000

8,457,000

153,923,000

157,599,000

122,161,000

23,527,000
70,842,000

22,540,000

20,040,000

67,052,000

61,314,000

50,966,000

May 30

41,425,000

40,629,000

38,989,000

38,523,000

May 30

786,755

769,618

781,499

664,223

657,494

682,457

615,459

March

$907,260

$665,299

$783,787

546,689

368,183

494,179

258,466

213,028

197,739

102,105

84,088

91,869

$1,083,795

$1,473,244

$1,433,642

696,860

of cars) __May 30

Ago

S.—

nonresidential

19,050,000

May 30

construction
residential

7,851,000

152,435,000

THE

OF LABOR—Month

omitted):

Year

Month

VALUA¬

1,812,000

May 30

building

New

5,573,000

URBAN

New

6,356,150

117,047,000

Kerosene
Distillate

fuel

Residual

oil

fuel

output

(bbls.)

oil

Kerosene ibbls.) at
Distillate fuel oil (bbls.)
Residual

fuel

ASSOCIATION

oil

(bbls.)

AMERICAN

Revenue

(number

cars)

CONSTRUCTION

Private

(no.

construction

$215,247,000

$291,296,000

OUTPUT

(U.

BUREAU

coke

(tons)

152,466,000

106,855,000

137,452,000

100,159,000

119,062,003

82,787,000

97,269,000

79,359,000

99,733,000
19,329,000

40,183,000

20,800,000

May 30

8,825,000

*8,785,000

8,750,000

millions

757,000

687,000

587,000

,743,000

131,100

*138,700

116,000

95,600

*112

114

May 30

.--May 30

'•

/ v;:

14,731

8,778

6,186

5,194

5,154

4,053

1,401
3,998

1,383

1,098

3,952

3,394

6,511

term

6,409

6,209

Credit

April 30:

credit

consumer

Personal

$20,940

19,267

RE¬

SERIES—Esti¬

credit

goods

loans

Noninstalment

$25,676

19,666

FEDERAL

Automobile
Other

246,422

$26,177

THE

REVISED

intermediate

450,093

136,853

OUTSTANDING—BOARD

and

consumer

737,127
696,515

573,669

9,073

short

762,722
710,522

350,969

municipal.

SYSTEM

Instalment

credit

Single payment loans...
Charge accounts

RESERVE

100

635,079

448,716

97,747

and

GOVERNORS

Total

8,327,000

May 30

—

SYSTEM—1947-49 AVERAGE

Repair and modernization loans...!

DEPARTMENT STORE SALES INDEX—FEDERAL

; | ■>

NEWS-RECORD—Month

construction

CONSUMER CREDIT

MINES):

Bituminous coal and lignite (tons)I
Pennsylvania anthracite (tons)
Beehive

EN¬

—

construction

State

$225,917,000

153,844,000

;128,448,000

June

$252,625,000

86,799,000

June

45,661,000
COAL

CONSTRUCTION

construction

mated

June
r

municipal

etc.

omitted):

Public

June

construction

and

(000's
U.

Private

Public construction
State

GINEERING

SERVE

NEWS-RECORD:
Total

ENGINEERING

Total

ENGINEERING

—

alterations,

Federal

freight received from connections

ENGINEERING

CIVIL

RAILROADS:

freight loaded

CIVIL

Additions,

May

May 30

Revenue

.•

CONTRUCTION
IN

All

May 30

(bbls.)

average

254,000

Gasoline

BUILDING

of
May 30

stills—daily

are as

Month

12.2

(000's

(bbls.

average

of quotations,

cases

Ago

June 14

each)_.

runs

Ago

or,

either for the

are

Latest

TION

Ingots and castings

Week

Dates shown in first column

that date,

production and other figures for the

cover

Year

to—

AMERICAN PETROLEUM INSTITUTE:
Crude oil and condensate output—daily
Crude

Month

Week

IRON AND STEEL INSTITUTE:

Indicated

2,147

2,142

2,007

2,602

2,535

1,691

1,665

1.667

113.7

Service

113.6

112.9

2,673

credit

•

EDISON ELECTRIC INSTITUTE:
c-iectric

FAILURES

June

._,.__—June

on 000 kwh.)_

output

(COMMERCIAL

INDUSTRIAL)

AND

BRADSTREET, INC-

—

—_

DUN

—

8,096,330

*7,956,144

7,896,539

7,005,066

217

168

165

CONSUMER

120

Month

&
'

■

All

Pig iron

steel

(per gross ton)

Scrap steel (per
METAL

PRICES

Electrolytic

June

ton)

gross

(E.

.—June

June

Lead

(New York)

Lead

(St. Louis)

East

4.131c

$55.26

$52.77

$38.83

$38.67

$38.83

$42.00

St.

29.700c

29.675c

—June

29.825c

29.725c

29.925c

96.000c

97.000c

93.000c

Louis)

29.675c

and

111.5

bakery products

products—i

Dairy

and

13.250c

12.500c

13.050c

12.300c

14.800c

June

11.000c

17.500c

115.6

107.4

113.9

114.8

110.3

110.4

115.0

115.5

121.1

110.4

109.1"

105.0

and

Solid

117.0

fuels

and

Household

operation

103.9

123.6

oil—

116.9

106.5
124.4

112.3

107.8

fuel

Housefurnishings

114.0

121.7

106.5

electricity

116.8.

122.1

Gas

15.000c

.June

—

113.9

117.7

109.0

:____

vegetables.

Other foods at home _!

111.3

106.8

111.7

111.1
118.0

Meats, poultry and fish

24.200c

June
:

home

Cereals

121,500c

—

36.875c

June

——

April:

Fruits

June

Export refinery attin (New York)

Zinc

4.376c

$55.26
'

4.417c

QUOTATIONS):

Domestic refinery at

4.417c

copper—

Straits

100—

items
Food

(per lb.)

INDEX—1947-49

Food

IRON AGE COMPOSITE PRICES:

Finished

PRICE

108.0

108.7

114.3

111.0

114.0
*

MOODY'S BOND PRICES DAILY AVERAGES:

Apparel

U..3. Government Bonds—

June

91.86

Average

„

June

102.46

corporate

Aaa

90.65

92.12

98.26

102.96

•

103.80

110.15

June

105.86

106.39

106.74

June

104.31

105.17

105.86

June

101.31

101.80

98.57

98.88

Railroad
i

BOND

DAILY

Bonds

101.31

101.97

107.44

103.30

109.63

UCTS—DEPT.

106.39

113.50

March:

105.17

—.10

3.19

■

3.07 -'v.

June

3.60

June

3.57

2.62

3.52

3.37

3.35
3.40

—

June

—

(tons)

Percentage
Unfilled

OIL,

orders

PAINT

.1949

(tons)

AND

AVERAGE

100

Stocks

3.55

Refined

3.19

3.44

3.37

417.4

436.5

—

341,666

200,761

Stocks

254,917

188,938

Produced

—_—

VTay 30

May 30

459,811

483,436

539,033

374,989

106.18

106.24

106.47

LOT

DEALERS

EXCHANGE

Odd-lot

by dealers

Number

EXCHANGE

(customers'

—

Customers'

short

Customers'

£|av

short
other

May 23

Other

TOTAL

ROUND-LOT

ACCOUNT

FOR

173

272

Stock

4,988

7,849

11,444

765,583

$24,900,347

$23,289,207

$31,423,632

$24,761,429

194,390

179,530

251,720

164,050

sales

Other

1~94~390

179~530

251/720

292,910

242,180

319,280

ROUND-LOT

WASHERS

SIZE

IRONERS

AND

'Total purchases

•lf
■

Short

■

1'•! •'

■

*■

Other

sales

Total sales.
•

233,790

297,810

292,080

Total

6,268,720

7,389,220

5,668,120

5,968,570

6,566,530

WEIGHTED

7,681,300

Railroad
•

5,848,730

Short

sales

Total sales

Other
"

rJ;.

sales

Banks

i__!

Amer.

Tel

(15)

197,980

72,850

12,900

3,400

22,000

173,800

166,300

224,830

188,300

237,730

————

219,730

222,862

259,705

59,960

60,190

314,470

323,010

—1

383,200

May lb
May 16

978,170

1,109,192

1,192,625

WHOLESALE
,

PRICES,

NEW

235,980

210,500

—

—.May 16

851,755

1,098,940

1,194,060

All

commodities..

products

May 16

1,020,645

1,334,920

1,404,560

932,534

RYS.

DEPT.

Processed

June

109.8

109.9

;.;*Revised figure.

of Jan.

June

97.3

99.0

109.7

104.8

105.1

104.5

„

1953 as against the >Fan. 1, 1952 basis of

95.9

June

113.4

108,587,670.tons,

$494,321

109,638

118,446

268,935

282,830

91,451

84,268

252,291

206,550
218,693

$1,391,203

125,944

71,410
«.

223,840

202,470

92.3

Commerce

operating

112.4

$77,799,925

deductions

from

§ Based

new

annual

capacity of

117,547,470
tFigures pot .available because of oil strike.

tons

for fixed

fixed

deductions

income

charges-———

charges—.—

—--

—-—

—

(way & structure & equipment)

Income

$80,074,947

16,087,475

! 4,369,320

92,039,095
4,334,922

92,059,556

55,943,484

<93,938,665
60,416,871
2,822,340
57,594,531

40,592,924

! 40,876,453

taxes

—-—-—

44,393,072

48,811,230
13,678,36L
7,240 W?

28,196,^07

2.80

2.89

,58,744,111
2,800,627

Dividend appropriations:
On
On

as
'

common

preferred

Ratio

stock

stock———!

of income to

fixed

$75,951,620

18,233,038

98,307,985

3,818,626

_1______

18,078,257
95,878,182

25,101,575

—

available

after

Federal

Commission)—

income—

income

Depreciation

115.5

113.4

$1,393,317

February:

-Net income

109.2

94.3

*113.5

foods

Ulncludes 660,000 barrels of foreign crude runs

$503,119

316,046

$1,626,602

institutions——.

income

Total

111.5

^June
and

5,^5

$604,854

"
r—-

(Interstate

Income

97.2

farm

lending

Miscellaneous

Other

"""

—

Jpods—_

commodities other than

3.30

5.50

236,016

railway

Other

All

3.41

5.51

OF-T

,4.57

INCOME ITEMS OF U. S. CLASS I

Month
Net

Income

....

—

5.87

5!53

4.60

BANK

SELECTED

LABOR—,(1947-49=^00):

Farm

,5.73

5.30

NONFARM

LOAN

compahies.—^—________—
savings banks
._!

Total

791,454

'•-Commodity Group—
-

5.52

6.21

(000's omitted):

associations—

companies

Miscellaneous

141,080

!———

SERIES

HOME

March

trust

and

Mutual

—

Individuals

740,970

168,890

„

——

—

Bank

37,000

240,405

Insurance

180,410

60,690

loan

and

FINANCING
U

BOARD—Month

122,300

______r

;

8,938

36,109

5.53
6.15
5.34
4-72
3.41

(24)

Tel.)

———r-—

AREAS

118,900

184,100

374,430

217,211

16,066

49,593

May:

1—

(10

(200)

Savings

—

includ.

(not

ESTATE

REAL

497,390

301,095

—

sales
;

783,630

275,844
312,844

—

sales

Total sales

772,190

10,300

—May 16
May 16
!
May 16
!__
May 16

purchases

Other

535,450

162,600

"
■

3,049

—

Short

100,680
396,710

_May 16

Total round-lot transactions for account of members—
Total

137,410
646,220

,176,710

floor—

off the
:

Total sales

-^ay

—

487,710

154,020
618,170

May 16
—-

——

sales

Other

■

purchases

Short

734,940

97,900

May 16

transactions initiated

Total
.

•>",

_—

623,730
!

lVlay 16

,——

Other sales

581,730
437,660

_May 1,6

the floor—

2,022

YIELD

AVERAGE

STOCKS—Month

(25)

Utilities

Average

May

—_

345,986

288,474
14,080
28,556

(125)

Insurance

MEM-

——————

purchases

7,552
•

ASSOCIA¬

(units)

dryers

COMMON

Industrial

180,610

5,734,780

•

Other transactions Initiated

—

sales
.■

13,379
2,916
2,382

HQME

(AMERICAN

—

MANUFACTURERS'

279,840

MOODY'S

specialists in stocks in which registered—,,

366

—

of washers (units)___;
of ironers (units)—.

BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS:

Transactions

•

3.931

'
.

242

1,377
1,309

2,335

May 16

1,100

.1'612

11,783

!—.1—
—

sales
sales

—May 16

,—

ACCOUNT

573

—

!
—

sales

May 16
FOR

99,405
121,984

(1,000 pounds)—

Factory

200

TRANSACTIONS

YORK

Total sales

Grabbots, etc.
April 30

Factory
Factory

(SHARES):

—

152,408

231,459

1.172
2,211

-r

164~050

STOCK TRANSACTIONS

sales

—

——

LAUNDRY

Short

77,961

TION)—Month of April:

"May 23

NEW

70,456

bales) —

—

STANDARD

THE

117,036

167,785

30_w___——,—^--—-r—.

HOUSEHOLD

Total Round-lot sales—

April

Shipped

-May 23

233,682

46,396

591,964

-May 23

SALES

197,301

106,633,000

3,493

576,786

(1,000-lb.

Produced

595,457

-May 23

MEMBERS

28,820

—

Fiber

Motes,

May 23
STOCK

82,479
<105,670
87,998

—

Produced

—.——

91,363
79,635
70,751

Shipped

22,020

EXCHANGE AND ROUND-LOT

:—

(tons)

Stocks

22,119

27,452

May 23

135

27,724

777,027

purchases by dealers—

Number

21,485

21,312

sales

Round-lot
:

;

22,406

584,635

sales by dealers—
'. Number of shares—Total sales-

$32,751,152

621,366

Hull

1699,578

$38,550,080

22,271

Round-lot

sales

866,522

$28,504,790

626,354

sales

Short

630,331

$31,857,987

—-May 23

Dollar value

25,196

31,308

——-———May 23

sales—

Customers'

21,775

705,238
23

May 23

Customers'

24,058

sales

shares—Total sales—

(tons)

Shipped

other sales

-Number

233,285

147,131

—

Produced

—

——

—

146,191

179,460

(running bales)—
Stocks April 30

^
—^

208,612
231,782

April 30

(tons) April 30

Shipped

—

Odd-lot purchases by dealers (customers' sales)—
Number of orders—Customers' total sales

434,758,000
123,723,000
106,108,000

129,093,000

Linters

STOCK

*811,815,000
*169,882,000
90,754,000

146,552

(tons)
"

—

Produced

COMMISSION:

purchases)

orders—

Dollar value
*

SPECIALISTS

SECURITIES

—

sales

Number

AND

134,840,000

(tons)

Shipped
Hulls

109.20

April

(pounds)

(tons)

Stocks
June

*149,973,000
165,269,000
*182,406,000

213,441

—

and Meal-

203,693

___.

518,480

174,631

(pounds)

249,134

STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODD-

305,597

949,436

115,388,000
131,004,000
170,533,000

April 30

(pounds)

226,810

INDEX—

.22,325

38,317

479,620

—

(pounds)—

Consumption

247,581

PRICE

602,963

881,275,000
159,289,000
92,053,000

30-*.-

(pounds)

Produced

Cake

24,862
371,335

Oil—

Stocks

2.98

419.3

(ton^)—/;*,
-

(pounds)

Shipped

—May 30

of period

REPORTER

3.60

3.47

mills

((ons) April

Produced

3.50

3.31

Oil—

Crude

3.20

3.76
3.63

PROD¬

SEED

COMMERCE—Month of

Seed—

Received

May 30

——

>t end

DRUG

3.62

413.6

3.55

3.82
3.67

COTTON

AND

Crushed (tons)

-L

activity

3.64

3.71

—June
-

NATIONAL PAPERBOARD ASSOCIATION:
Orders received (tons)
Production

3.84

—June

INDEX

SEED

Stocks

3.02

June

Group

COMMODITY

2.93

3.44

June

___

<-*/

3.16

3.40

3.67*

i
Utilities

COTTON

Cotton

—June

Railroad Group

Public

115.2

102.46

104.66

3.49

Industrials

106.2

117.5

100.65

—

MOODY'S

107.7

104.14

AVERAGES:

—

corporate

Aaa

Baa

112.4

107.9
117.9

service.

and

102.13

June

YIELD

Government

111.3

312.5

!_______

care

goods

June

■

Average

106.0
124.8
115.9

Other

—June

Public Utilities Group
Industrials Group
MOODY'S

119.5;

Reading and recreation

109.42

99.84
'

,_!

Group

103.30

—

104.7
129.3

120.2

—

care

Personal

112.75

A V,

Medical

114.46

104.6
129.4

Transportation

charges

——

;

-2.76

87,704,173
54,663,799

2,910,608

-51,753,191
38,858,314
52,445,157

16,419.1^7

The Commercial and Financial Chronicle..

(2356)

Continued from page

Such actions

spread

have

employees who desire to work, is
and frequently an incitement to law¬
lessness and violence and should,

wide¬

created

for orderly

pressure

limited picketing.

Picketing

This

legislation

in all other

is to limit the acts of those unions

which

members

union

those

against acts not in the public in¬

terest.

resolve

is taking

is coercion, not of the other
party
legislation to protect in¬ to the dispute, but of an innocent
dividuals and society in general third party. As the employer who
need

JOHN P. GATY

the

Wichita 1, Kansas

been sympathetic
when their conduct

I have always

unions

with

have

Hyde

seen

munist
trolled

that

picketing is a
• »ecessary
part of the right to
♦^brike. Of course, it should be
believe

the prem¬

t h

Ingress or egress from
ises being picketed.

living examples of Com¬

ployee
not

essarily

unions,

nec¬

his

It,
therefore, de¬
him

nies

g-c o n-

$ ^resident, First Bank &

Trust Co.

with

Actually,
picketing
proves
nothi n g
because

want

those who

Jus¬

tice at present

of Utica, New York
agree

Depart¬

ment

ROKAHR

busily

en¬

docketing made illegal because it
^Infringes on property rights and
along the New
«cival liberties." The argument of
■line

propo-

♦tents of

able thing for

they have gone on strike against
their employer. However, picket¬

strike

•AHe

aveapon

and violence
property is
an
entirely different thing. The
use
of the picketing weapon by

♦igkts"

either

mine)

ftihasis

becomes

ing

se-

human

«are

employees to do, if

one

roving

ri-

thing,

persons

squads, either hired

goon

^fliculous in the

by the union for that purpose or

• ight of the
#ioodlumism

brought in from other towns and
cities and set up outside the place
of business, is certainly something

which usually

else.

characterizes

In
other
words, the original
picketing —
Theodore Rokahr
concept of picketing was that the
*cmd especially
♦xiass picketing.
By means of in¬ employee would picket the place
of business of his employer. This
timidation, and often by means of
H%ctual violence, it denies the right concept has been distorted and
•la work to those who want to corrupted in many ways during
*vork. If that, and ^overturning or past several years. It seems to me
elfcerwise damaging the automo- that it would be possible to restore
• riles of workers who try to go to the basic concept and bar the
•ttvoric through picket lines, are vicious practices which have
grown up almost by default dur¬
♦means of "securing human free«[om," my concept of human free- ing the past decades.

injury to

It is also based

their families.

on a

fear complex

afraid

the

law

quick

against

union
sign
immaturity; and while unions

have grown up a

they have

lot in the last 50
a

Fairbanks, Morse & Co.,

picketing

and

Hihases of that subject can
lamarized as follows:

related
be sum-

long way to go.

belief

our

far

eliminated

able.
'

the,.

it is my
opinion that
ever,

Melvin H. Baker

(b)

Bill Lantaff

I feel that peaceful

adjunct
right to strike.
a

necessary

picketing is
of labor's

<c)
ized

gain

Picketing of
unit

ployer by

of
a

that

representation
a

non-union¬

multiple unit

em¬

unionized section of

that company.

Picketing to further

the

specific purposes

should

clared

above

illegal, and

de¬

employer so
^attacked should be able to
gain
ttegal redress for losses incurred.
We do not believe that
peaceful

picketing

infringes

♦rights and civil liberties.
lieve
♦not

that

peaceful

rea¬

num¬

only

and

We be¬

President, Central Hudson Gas &

•: so

many

aspects of this subject it is
ficult
my

one

to discuss. In

dif¬

submitting

comments, I wish to empha¬

eting would be

not

permissible.

exception

Then the

the proper use

em¬

ployer,

the employees and the
public would not/ be the victims
of violence and other lawless acts.

take

How-

what¬

ever,
ever

said

any

picketing
peaceful

manner.

Picketing for linion recognition
or
organization purposes should
not be permitted? as the unions

may
on

behalf

have available to them the tried
and tested method of settling such

of p e a ce f u 1

picketing

as a

questions through the ballot box

form

free

speech and

elections

government.
It

conducted

the

method

well known fact

advising

the
public of a

in far

too

many casest that the » use of
violence and destruction by .pinion
date the employer, the publicl and
fellow employees has beerir
.re¬

sented by

the

has

very

his

position by
peaceful picketing;
i. e.*,
picketing that

reason¬

obvious in

the American, people.

Ernest R.

tion in

Acker

cases'

pute exists,

picketing
an

unfair

Union's

where

I believe

causes

in¬

not

does

that where all

terfere

threaten to in¬

wit 1^

terfere

safety of per-

\ son s

;;erty
"

prop-

the

and

free and

unre¬

stricted

move¬

ment

right to work, and to

the

knowis>

make

and

sons

would be un-American.

C. L. Austin

per-

things

to or from the

employer's

ERNEST R. ACKER

size that I do

property pickets in the attempt to intimi¬

picketing is
improper exercise of "free

others

constitutional

the employeedefinite right to

concept of liberty

R. J. KOCH
V

peaceful pick¬

an em¬

ployer
union

"trying
♦rights.

sonable

W.W.Sebald

believe, in the first place, that:

under our American

other hand, where

are

Picket¬

ing of

C* R. Gaiennie

amended

ited to

ber

owner can

right in it. On the
a majority of
labor represents the union and a
minority does not for any reason
participate in v the union, that
majority has no right to deny
have

Pittsburgh 30, Pa.

closed union, then outside work¬

ers

Jones & Laughlin Steel Corp.,

provided

Our

labor

that

property or elsewhere; and that
this right should be protected by

President, Felt & Tarrant Mfg. Co.,
law.
Chicago, HI.

Picket¬

L. AUSTIN

President,

ing in this will

that pickets Electric Corp., Poughkeepsie, N. Y.
would be lim¬
Because
there

(a)

R. E. Sommer

destruction.

the

ing to aid an
illegal second¬
ary boycott.

our

should

violence

il¬

the

law to prevent

ley Act should

legal:

one

closed union

invoke

Government

situations

where

the

Florida

U. S Congressman from

should declare

following

be allowed the

the Taft-Hart¬

to work,

if he wants to,

right to pick¬

en¬

pick¬
How-

eting.

Federal

a man

picketing which

shop

HON. BILL LANTAFF

vent all

we
that

believe

The

harm.

labor agree to

realistic to

and

bodily

even

operate under

to make it more work¬

necessary

infringes on prop¬
erty rights and civil liberties, it
is my view that it would not be

that

deavor to pre-*

legislation
concerned,

coercion

freedoms

should

are

that picketing

Our company's attitude with re-

1g£Brd

its

Constitution
personal opinions
plant is operating under an open- is
supposed to provide. Any viola¬
and, naturally, I would like to see
shop contract. It is our further tion of it is a violation of the Con¬
the Taft-Hartley Act retained on
belief
that
our statutes,
stitution.
although I appreci¬
plants
which
ate that certain amendments are
These

who feel

some

are

work.

MELVIN H. BAKER

While there

Chicago 5, 111.

who

willing

adequate

the

Chairman, National Gypsum Co.,
:
Buffalo 2, N. Y.

Middletown, Ohio

and

from

is able and

basic right of

President, Armco Steel Corp.,

Director of Persoimel,

who

foregoing worst
form, it
types of picketing, I think a long
involves fear,
step forward would have been

W. W. SEBALD

should be

employees

someone

em¬

amended

were

Hdom must be all wrong.
L. R. GAIENNIE

the

REUBEN E. SOMMER

of
and thus

some

destroy the power of the
leader. A fear complex is

years,

"picketing"
to

working

majority of the

taken toward the promotion
their peaceful labor relations.

members will go to work

have

rep¬

of the unions themselves because
are

think

confined

whereby

ployees.

North

remedy

they

Walter M. Mumma

the
gain prompt relief.

can

represent
Alden

John

are

provide

re¬

status, it should prohibit picketing the basic purpose of picketing is
to prevent
«
*
cases where the Union does not

freely ex¬

jury

employer when the Union

pressing themselves, but refrain¬

picketing is a reason¬

that

procedure

ing because of fear of bodily in¬

John P. Gaty

front. It seems

pick¬

eting "that it
4s an essential
component

not

water¬

York

work

sire

It,
entirely

those who de¬

gaged in in¬
vestigating
such activities

stoppages.

only a minority of the
President & General Manager,
employees. As the law provides
Keystone Steel & Wire Company*
procedures by which a Union rep¬
Peoria 7, 111.
resenting a majority of the em¬
My views on this topic are that
ployees can obtain a bargaining

right to work.

The
THEODORE

cause

reason

resents

the

trolled unions.

jurisdictional dispute without

union.

plain ordinary

Unions

grievance and use this
method
of
supplementing their
Another abuse which contrib¬
others especially
utes to labor unrest and is con¬ position — no
when there is no labor dispute
trary to the public interest is
with one's own employees.
picketing to force recognition by

agree

e r

work

seems

employer

with the lead-

and

the

reasonable that Unions should find
some
method
of
settling their

vide

who

does

con¬

o ns,

act

cannot

cases

sorting to this practice, or legis¬
the free lation should be enacted to pro¬

it forcibly prevents
of work¬

cause

an em¬

control led
u n

always felt picketing was in viola¬
tion of constitutional rights be¬

ing by

racketeer-

$*eaeeful picketing only and should
#xot be such that it would prevent

merely state that I have

has been ethical and proper.
De Witt S.

I would

therefore,

Hartford, Conn.

General Manager,
Beech Aircraft Corporation,

such

dispute,

great economic loss

President,

Viee-Pres. and

the

they

JOHN A. NORTH

place.

picketed

should recognize the unfairness of
their acts and the fact

The Phoenix Insurance Co.,

Pennsylvania

need to be restrained the same as

summarily under the police power
of the State in which such action

U. S. Congressman from

Picketing resulting from juris¬
dictional disputes between Unions

roristic, it should no longer come
under the protection of the Con¬
stitution and should be dealt with

g
S.

HON. WALTER M. MUMMA

therefore, be prohibited.

speech" guaranteed by the ConstirAnpT^sTti'in from TVfa.rvI21.1ifl
Congressman trom Maryland tution. However, when picketing
becomes violent, abusive and ter¬
S. HYDE

HON. DeWITT
*Tf

.Thursday, June 11, 1953

both

instances

where

•

I believe also

our

that there

are

•

two

other

rights under our concept of
liberty which must be protected.
The first of these is the right of

plant was picketed, threats to the
physical wel¬
fare

em¬

ployees

the

was

made. Wheth¬
er

the

not

unions

whole sanction
tactics

of this

kind, the fact
remains
where

beings

moved

that

human
are

to be

accepted

of coercion

R. J. Koch

other interference

with the rights of others, is proper
and should not be interfered with

writer

does not believe that it is

to have

whole

position
can
be
simply and ex¬
pressed in this fashion; that peace¬
ful picketing of an employer's
premises by his employees, short

the

his property

boiled down very

part

f
picketing.
Personally,

to and from

he may desire.

The

in¬

volved threats
seem

employee to enter upon the
employer's property to work if
that entrance is permitted by the
employer. The second is the prop¬
erty right of the employer which
most definitely includes his right
to have persons and things freely

possible

by law; picketing which involves

picketing without intimi¬

such

dis¬

dation in spite of the pious state¬

ence

mass

ments of the union and other sup¬

posi¬

labor unrest, is

porters

such

activities,

"intimidation of' those. picketing is;a}l peaceful^

;

that
-

coercion

other

interfer¬

is contrary to the constitu¬
tional liberty of Americans and

should be prohibited, specifically
by law and the law diligenty en¬
forced./ .t'j?
•
c
:
.

...

Volume 177

Number 5228... The Commercial and Financial
Chronicle

(2557)

•

* INDICATES

Securities Now in Registration
Aberdeen Idaho Mining Co., Wallace, Idaho
(letter of notification) 100,000 shares of non¬
assessable common stock. Price — 15 cents
per share.
Proceeds — To develop mining claims. Underwriter —

Arcturus Electronics, Inc., Newark,

March 30

Price—At market

(about $2 to $2*&

In lieu
cash.

per

share).

(letter

King, Libaire, Stout & Co., New York.

capital.

the

basis

new

for

each

Underwriter

quire airplanes and equipment and for working capital.
Underwriter—Union

mentioned bid

group

and

101.4011

for

interest

syndicate headed by Smith, Barney &

100.0788 for

interest rate of 5%%.

Offering

record

June

amendment.

four

Proceeds—For

working capital. Business—

Manufacturer of tires and tubes. Underwriter—Reynolds
& Co., New York. Offering—Temporarily postponed.
•

Mines, Ltd. (6/22)
April 17 filed 500,000 shares of common stock (par 10
cents).
Formerly known as American-Canadian Ura¬
nium Co., Ltd. Price — $1.25 per share. Proceeds — For
engineering, development and mining expenses. Under¬
writer—George D. Clarke, Ltd., 50 Broad Street, New
■

and

• Aviation
Equipment Corp. (6/12)
April 17 filed $1,000,000 of 6% subordinated debentures

due.1964; 8,000 shares of 6% preferred stock (par $50),
depositary receipts representing 8,000 shares of

com-

Proceeds

(Union

June

Securities

June

(McLaughlin,

Chlorophyll

Co.)

(George

Common

Securities,

Common
Securities

Corp.)

10:30

North American Peat Moss
(R.

Keppler &

$20,000,000

Inc.)

Rhoades &

Co.)

(Bids

June

(Tuesday)

45,254

Co.)

500,000

New

(Estabrook

Boland)

Brothers

New Jersey Power
(Bids

and

Common

Bear,

EDT)

a.m.

Blyth

Stearns

Wood

Co.)

Gulf Life Insurance

Co.,

(The

(Bids

New York,

Boston

(Bids

invited)

—

For

a.m.

June

noon

EDT)

rights to

expire

Proceeds—For
—

Pittston

Co.

July 8

$1,170,000

p.m.

(Gearhart & Otis, Inc.)

share for eaclv

new

modernization and expansion program.

Produces

Francis I. du Pont &
Blackwood

one

beryllium alloys.
Co., New York.

Underwriter —'1

Nichols Co.,

Oklahoma City, Okie.*
Co., Madison, N. J.
May 1 filed 359 working interests in oil and gas lease#
to be offered for sale "as a speculation." Price—$1,392.75*
per working interest.
Proceeds—For development a?
oil and gas leases. Underwriter—None.

^ Bonanza Mining Co., Phoenix, Ariz.
(letter of notification) 300,000 shares of

June 8

Price

—

At par

common

share). Proceeds — Fen*
Office—807 Title & Trust Bldg., Phoes*

working capital.

nix, Ariz.

($1

per

Underwriter—None.

•

Brandywine Raceway Association, Inc.,
Wilmington, Del.
May 14 filed $1,600,000 of 6% debentures due June 3»
1978 and 160,000 shares of capital stock (par $1) to fee#
offered in units of

one

$500 debenture and 50 shares <*t

stock.

Price—$600 per unit. Proceeds—To repay deb&
and for working capital. Underwriters—Laird Securitie#

Co., Inc., and Laird, Blssell & Meeds, both of Wilming¬
ton, Del.; and Harrison & Co., Philadelphia, Pa. Offer¬
ing—Expected today (June 11).
Ltd., Toronto, Canada

acquire leases and for corporate purposes.

Under

■

Brooks & Perkins, Inc., Detroit, Mich.
April 22 (letter of notification) 6,475 shares of commcs*
stock (par $1). Price—$6 per share. Proceeds—To in*<»
derwriter, Watling, Lerchen & Co., Detroit, Mich.

Byrd Oil Corp., Dallas, Tex.
Oct. 22 filed $1,750,000 of 10-year

5J/2% convertible sink-*

fng fund mortgage bonds due Nov. 1, 1962, to be offeree#
for subscription by common stockholders at the rate
$100 of bonds for each 28 shares of stock held (for ck
14-day standby). Certain stockholders have waived thei*
rights. Price—At par. Proceeds—To repay $1,014,500 c!A
outstanding notes and for drilling expenses and workintl
capital. Underwriters—Dallas Rupe & Son, Dallas, Tex^j
Carl M. Loeb, Rhoades & Co., New York; and Straiw.
Blosser & McDowell, Chicago, III. Offering—Postponed.
Carolina Casualty Insurance Co., Burlington, N.&*
April 29 (letter of notification) 103,506 shares of clast
B non-voting common stock (par $1) being offered to
stockholders of record April 17 at rate of one new sham
for each five shares held; rights to expire July 17. Pilot#
—$2 per share. Proceeds—To increase capital and sur¬
plus. Office—262 Morehead St., Burlington, N. C. Un¬

derwriter—None.

Natural

Gas Corp., Seattle, Wash.
(letter of notification) 60,720 shares of com¬
mon stock (no par) to be offered in exchange for 11,400
shares of 8% cumulative convertible preferred stock (pas*
$5) and common stock (par $5) of Northwest Cities

Continued

page

(Wednesday)

Notes & Stock
$787,500

.Common

(Wednesday)
—Bonds

(Bids to be invited) $40,000,000

:.,,

July 16 (Thursday)
Co

—Bonds

Consumers Power
(Bids

invited)

$25,000,000

i,000,000 shares,^

♦

New York.

Boston

Philadelphia

August 3

Common

^"TEids

Pittsburgh

San Francisco

(Monday)

Denver & Rio Grande Western RR
be

invited)'

writer—None. To be named by amendment.

EDT)

Preferred

(Offering to stockholders—no underwriting)

U. S. Airlines, Inc

Commonwealth Edison Co

CDTJ)

the basis of

(with an oversubscription privilege):;
on June
18.
Price—$25.50 per share.

Eq. Tr. Ctfs.

Equip. Trust Ctfs.
noon

held

stockholders—underwritten by The First Boston
Co., Inc.) 40,000 shs.

$3,150,000

Chicago, St. Paul, Minneapolis &
(Bids

—*♦

Corp. and The Robinson-Humphrey

(Thursday)

Omaha Ry.

Underwriter

$12,500,000

Mobile Gas Service Corp
(Offering

program.

Park, N. J. Underwriter—McLaughlin, Reus:*
Co., New York.

Bonds

EDT)

(C. K. Pistell & Co., Inc.)

Common

Chicago & St. Louis RR
(Bids

(Tuesday)

Applied Science Corp

170,000

construction

___Pfd. & Common

July 1
Common

each afcs

Bergen Daily Bulletin, Inc. (6/15-17)
May 21 (letter of notification) 100,000 shares of common
stock (par 10 cents). Price—$1.50 per share. Proceeds—
To buy equipment and for working capital. Office —-

Cascade

1,500,000 shares

Seeck & Kade, Inc

(Wednesday)

Corp.)

Inc.)

shs.

Common
to

June 30

15,000

for

March 30

Pennsylvania Electric Co

Light Co

First

Thorndike,

common

(Monday)

Bonds

(Equitable Securities Corp. and R. S. Dickson & Co.)

Kansas Power &

40,000

Gas Service Co

Inc.;

$5,500,000

999,216

Debs. & Stock

Jeffries

and

(Bids

June

(Thursday)
Corp

Childs,

and

$240,000

& Co.)

Skiatron Electronics & Television Corp._.Common
(Wright,

Common

debentures

June

& Light Co

Co.
of

$299,000

to .stockholders—underwritten
Lehman

$8,445,000

Common

England Electric System

(Offering

Equip. Trust Ctfs.
EDT)

June 25

Nagler Helicopter Co., Inc..
R.

$35,000,000

(Wednesday)

noon

Sunrise Supermarkets
$400,000

(John

EDT)

stockholders—no underwriting)

Smith,

Common

Co.)

(Offering

Johnston Oil & Gas Co
(Allen

Bonds

a.m.

York County Gas Co

Common

stockholders—underwritten

Barney

$$6,000,000

Southern Pacific Co

$7,000,000

Bangor Hydro-Electric Co
(Offering

Common
about

$245,000

(Bias

June

Class B

(Tuesday)

(EDT)

a.m.

Bonds
EDT)

a.m.

:_Preferred

Gulf States Utilities Co

Washington Gas Light Co
11:30

New York Telephone

Common

Loeb,

(Bids

June

Common

$500,000

Remington Corp.
(Carl

$625,000

(Offering to stockholders—no underwriting)

Co., Inc

Co.,

Common

Ltd.)

Bonds

EST)

a.m.

Clarke,

Rogers Corp.

$300,000

Michigan Consolidated Gas Co
(Bids

(Monday)

Mines, Ltd

(Reynolds & Co.) $4,000,000

KLB Oil Corp..
(Aetna

$1,250,000

Robertshaw-Fulton Controls Co

$300,000

Inc.)

Co.)

Athabasca Uranium

$150,000

Chemical Corp

(Mitchell

Reid

June

—Common

•

(Friday)
Preferred

(Fulton,

(Monday)

Reuss

Erie Resistor Corp

Corp.)

Bergen Daily Bulletin, Inc

new

Sept. 25 filed 1,000,000 shares of common stock (par $I>.
Price—Approximately 64.48 cents per share. Proceeds—*

(Friday)

one

Smith, Barney & Co., New York.

Bristol Oils

NEW ISSUE CALENDAR
Debs. & Stock

(with an oversubscription privilege); right:#
expire July 1.
Price—To be supplied by amendment

stock.

Athabasca Uranium

York.

rate

shares held

and Oil & Gas

York.

June

Corp., New York.

Bangor Hydro-Electric Co., Bangor, Me. (6/1S)*
May 26 filed 45,254 shares of common stock (par $15) tf»
be offered for subscription by common stockholders est

Business

first

10 shares of stock. Price—$105 per unit, Proceeds—For
acquisition of stock of two companies, who will borrow
the remainder to repay bank loans and for
working
capital. Underwriter — C. K. Pistell & Co., Inc., New

Aviation Equipment Corp

Securities

£©ur

Armstrong Rubber Co.
$4,000,000 of 5% convertible subordinated
debentures due May 1, 1973. Price—To be supplied by

—

•
Applied Science Corp. of Princeton (7/1)
May 21 filed $750,000 of 6% guaranteed sinking fund 10year debenture notes due April 30, 1963, of this company
and 75,000 shares of common stock
(par one cent) of
Bradco, Inc., to be offered in units of $100 of notes and

Proceeds—From sale of securities, to¬

unit.

per

of record June 5

—Indefinitely postponed.

Kidder, Peabody & Co., New York.

—

$1,550

Palisades

Co.

Co. bid

$40 per
share. Proceeds—For working capital. Office—St.
Louis,
Mo.

(jointly);

March 31 filed

Price

$1,06#

• Beryllium
Corp., Reading, Pa.
May 15 filed 88,385 shares of common stock (no par>
being offered for subscription by common stockholders

rate of 5%

Insurance Co.

one

The

May 13 filed 125,000 shares of capital stock (par $4)
being offered for subscription by stockholders of record

held; rights to expire June 17.

Co.

to be offered in units of

C^ar $1)

debenture, eight shares of preferred stock and depositary
receipts representing eight shares of common stock. Prices

Inc.; The First Boston Corp. and Lazard Freres
(jointly); Union Securities Corp.; Smith, Barney
& Co.; Equitable Securities Corp. Bids — Received on
May 25 at 70 Pine St., New York, N. Y., were rejected.

tional Securities Corp., Seattle, Wash.

Freres

ISSUE

£ Alaska-Wrangell Mills, Inc., Seattle, Wash.
June 9 (letter of notification) 58,000 shares of
capital
£tock.
Price—At par
($5 per share).
Proceeds—For
working capital.
Business—Lumber mill.
Office—216
Third Ave., South, Seattle, Wash.
Underwriter — Na¬

Lazard

REVISED

art & Co.

Underwriter—None.

June

Under¬

Arkansas Louisiana Gas Co.

American Automobile

and

stock

ITEMS

April 22 filed $35,000,000 of first mortgage bonds due
1978. Proceeds—To repay $24,500,000 bank loans and for
new construction, etc.
Underwriters—To be determined
by competitive bidding. Probable bidders: Halsey, Stu¬

$25

—

elect to take

may

preferred stock.

statement may be withdrawn.

notification) 5,000 shares of capital
per share.
Proceeds — For working
Office—717-720 Empire Bldg., Birmingham, Ala.

Price

thereof, preferred stockholders

•

gether with $4,000,000 to be borrowed from bank, to ac¬

Equitable
Corp.; Smith, Barney & Co.; Blyth & Co., Inc.
Bids—No bids received on June 2; subsequently directors
decided to borrow $23,000,000 from banks.
Registration

^ Alabama Life & Casualty Insurance Co.
3

Under¬

Securities

Ltd., Vancouver, B. C., Can.
April 22 filed 250,000 shares of common stock (no par).
Price—$1 per share (net to company). Proceeds — To
purchase equipment and supplies. Underwriter—M. H. B.
Weikel, Los Angeles, Calif.

stock.

Reploge, President.

Proceeds—To retire said

Corp.

Acteon Gold Mines

June

50 cents per share.

writer—To be determined by competitive
bidding. Prob¬
able bidders: Halsey, Stuart & Co.
Inc.; The First Boston

common

Proceeds—To Nash S. Eldridge, the selling stockholder.
Office—464-72 East 99th St., Brooklyn 12, N. Y. Under¬
writer—Eisele &

—

debentures in exchange for each share of 6% cumulative
preferred stock (par $10) of Arkansas Natural Gas Corp.

Underwriter—-None.

Acryvin Corp. of America, Inc.
May 7 (letter of notification) 3,000 shares of
stock.

Delbert

Price

Arkansas Fuel Oil Corp.,
Shreveport, La.
May 1 filed $22,520,000 of sinking fund debentures due
1973 to be offered at rate of $10.60
principal amount of

—At prices not less than 50 cents
per share of stock and
25 cents per warrant below current market. Proceeds—

Co., New York.

(par 1 cent).

ADDITION*

SINCE

mon

writer—Gearhart & Otis, Inc., New York.

ACF-Brill Motors Co., Philadelphia, Pa.
April 20 filed 215,360 shares of common stock (par $2.50)
and 44,303.5 common stock subscription warrants.
Price

stock

Proceeds —To

Wallace Brokerage Co., Wallace, Idaho.

To Allen

N. J.

March 27 (letter of notification)
40,000 shares of class A
common

Chicago

Cleveland
/

Eqp. Tr. Ctfs.
*

Private Wires to all

offices

Continued from page
Co.

per

49
in cash. Price—

l-for-5^ basis, plus 25 cents

$25

stocks.

share. Proceeds —To acquire aforementioned
Underwriter—Sheridan Bogan Paul & Co., Phila¬

delphia, Pa.

notification) 1,800,000 shares of com¬
share). Proceeds

March 4 (letter of

Price—At par (10 cents per

stocks.

mining operations.

—For

Underwriter—R. L. Hughes &

Co., Denver, Colo.

Colo.

worth, Sullivan & Co., Denver,

Brothers, Manchester, Conn.
May 8 (letter of notification) 23,872 shares of common
stock (no par) to be offered for subscription by common
stockholders of record May 1 at rate of one new share
Cheney

expire on June 15.
For working cap¬
ital. Office—Hartford Road, Manchester, Conn. Business
—Manufactures and sells textiles. Underwriter—None.
each

Price

ten

$11

—

rights to

held;

now

share. Proceeds

per

—

Cheyenne Oil Ventures, Inc., Denver, Colo.
(letter of notification) 150,000 shares of common
stock (par one cent). Price—24 cents per share. Proceeds
—For working capital. Office—702-4 Ernest & Cranmer
Bldg., Denver 2, Colo. Underwriter—Tellier & Co., New
June 1

York.

Chicago Bridge & Iron Co.

May 11 (letter of notification) 6,112 shares of common
stock (par $20) to be offered for subscription of em¬
ployees. Price—$49.08 per share. Proceeds—For general

West 105th St., Chi¬

corporate purposes., Offices—1305

111: Underwriter—None.

cago,

Chlorophyll Chemical Corp., New York (6/15)1
May 28 (letter of notification) 300,000 shares of common
stock (par 10 cents). Price—$1 per share; Proceeds—To

Cabot Co. and for
payment of other obligations and working capital. Busi¬
ness—Manufacture and sale of chlorophyll and chloro¬
$30,000

repay

note

Godfrey

phyll derivatives to the pharmaceutical, drug, cosmetic,
and

food

Underwriter-*Mitchell Se¬
curities, Inc., Baltimore, Md. and New York, N. Y.
processing trades.

C.l.T. Financial Corp., New York

May 15 filed $50,000,000 of debentures due June 1, 1967.
Price—To

supplied

amendment.

Proceeds—For

working capital. Underwriters—Dillon, Read & Co. Inc.;
Kuhn, Loeb & Co.; and Lehman Brothers, all of New
York.

Offering—Temporarily postponed,

May

Casualty Co. of New York

(letter

notification)

8,000

dividend preferred stock. Price—At par
to

be offered

first to

stockholders

($25

share)

per

rate

$1.50

one

for each 32 shares of stock held. Proceeds—To purchase

31,500 additional shares of
demnity Co. at $6
York 38,

per

of Arex

stock

common

In¬

share. Office—116 John St., New

N. Y. Underwriter—None.

Code Products Corp.,

April 20 filed

share.

Philadelphia, Pa.
(amendment) 500,000 shares of 6%

cu¬

Dixie Fire & Casualty Co., Greer,

May 1 filed 55,313 shares of capital stock (par $5) to be
Eagle Super Markets, Inc., Moline, III.
offered for subscription by stockholders on the basi*
May 21 (letter of notification) 25,000 shares of 6% pre- r
ferred stock. Price—At par ($10 per share). Proceeds— - of one new share for each four shares held as of May 28.
rights to expire about June 17. Price—To be supplied
To redeem first preferred stock and for working capital.
by amendment. Proceeds — For general corporate pur¬
Office—2519 Fourth Ave., Moline,
111.
Underwriter..

Edgar Brothers Co., Metuchen, N. J.
May 15 filed 100,000 shares of common stock

Federation

share for each share held; not more than

5,000 unsubscribed shares to be offered to certain

em-

Inc.
May 11 (letter of notification) 10,000 shares of common
stock (par $1) to be offered for subscription by stock¬
1

expire July 1. Price

$15 per share. Proceeds

—.

—

For.

working capital.

Office— Long Branch Ave., Long
Branch, N. J. Underwriter—None.
Erie Resistor Corp., Erie, Pa.
(6/19)
May 29 filed 62,500 shares of convertible preferred stock.
Price—At par ($20 per share). Proceeds—To purchase
machinery and equipment and for working capital.

Underwriter—Fulton, Reid & Co., Cleveland, O.

struct

warehouse.

new

Underwriter—None.

Flavor

Seal, Inc., Spokane, Wash.May 19 j(letter of notification) 4,000 shares of common
Price—At par ($10 per share).
Proceeds—For
working capital. Business—Makes a formula for pro.
cessing fresh meat. Office—726 Paulsen Bldg., Spokane
stock.

Wash.

Underwriter—R. L. Emacio &

Co., Inc., Spokane

Fort Myers Beach Water Works, Inc.
May 21 (letter of notification) $298,000 of 5V2% first
mortgage bonds due May 1, 1968 and 2,980 shares of

(par $1) to be sold in units of

bond and 10 shares of stock.

ceeds—For

working capital.

one

Corpus Christi Refining Co.
June

filed

cents),

970,000

which

820,000

Underwriter—Goodbody & Co., St. Peters¬

stock

are

offered

(par

the public.
ing

Price—$1.50 per share. Proceeds—For work¬
capital, etc. Underwriter—Vickers
Brothers, New

York

Latter will receive warrants to
maining 150,000 common shares.

...

purchase the

D®j*®^"M°ntana Oil Leaseholds,
ay 1 (letter of

Inc., N. Y.

SS
?ff'C»7n35 Fi£fh Ave'' NeW Y0rk>
Underwriter—Weber, Millican
W

Co., New York.

•

Dacca

May

318,625

capital

1' June 9 at rate ofsubscription
^emg °fffed for

N- Y-

one

held; rights to expire

share.

new

stock

(par

June

25.

for

each

and

Laurence

Price—$9.20

Proceeds—For working
capital, etc.

wnters—Reynoids & Co.
Co., both of New York.

by stockholders of

Under-

Marks

June

(letter of notification) 7,500 shares of common
be offered for subscription by present stock¬

stock

($20

Price—At par

holders.

share).

per

used

Empire

stock (par $10)

by Cities Service Co. to increase
Gas & Fuel Co., another sub¬

Proceeds—To

purchase equipment and for working capital. Office—
287 Homestead Ave., Hartford, Conn.
Underwriter ' —
:

' v

Heat-O-Malic, Inc., Pittsburgh, Pa.
May 22 (letter of notification)

20,000 shares of common
(par $3) to be offered for subscription by present

stock

stockholders until June 30, 1953. Price—$1 per

share to

stockholders; $1.50 to public.. Proceeds—To pay current
liabilities and for working capital. Address—Joseph, fr.
Carroll, President, 2886 Glenmore

Ave., Pittsburgh^l6,

Underwriter—None.

Pa.

^ Huse-Liberty Mica Co., Boston, Mass.
4

June

of notification)

(letter

Robert

Chapman, Jr.
Underwriter

Mass.

Co.

Trust

5,000 shares of

common

share. Proceeds—To
Earle, trustees for
Office—171 Camden St., Boston,
F. L. Putnam & Co., Inc., Boston,

Price—$12.75

(par $5).
Harvard

—

and

per

'
<

Mass.

Hydrocap Eastern, Inc., Philadelphia, Pa.
April 27 filed 500,000 shares of common stock, of which
underwriters have agreed to purchase 100,000 shares for

public sale and

to use

"best efforts" to sell remaining
Proceeds—To es¬

Price—At par ($1 per share).

tablish

assembly plant and acquire

derwriter—Barham

raw

materials. Un¬

Co., Coral Gables, Fla.

^Inland Empire Corp., Salt Lake City, Utah
June

Frice—10 cents per

stock.

(letter of notification)

500,000 shares of common
share.^ Proceeds—For devel¬

opment costs. Office—620 Judge Bldg., Salt Lake City,
Utah.
Business—Metal treatment. Underwriter—None.
Co. of North America,

Insurance
common

Phila., Pa.

April 16 filed 30,000 shares of capital stock (par $5) to
be offered for sale to employees of company and five
affiliated

Underwriter—None.

companies.

International

Harvester Co.,

Chicago, III.

sidiary. Underwriters—To be determined by competitive
bidding. Probable bidders: Blyth & Co., Inc. and Kidder.
Peabody & Co. (jointly); Smith, Barney & Co.; Stone

April 24 filed !!88,000 shares of common stock (no par)

company

Webster

(jointly).

Securities

Corp.

and

Stern

Bros.

General Dynamics Corp.
May 12 filed 250,000 shares of

bank loans made to acquire

stock

(par $3)

Proceeds—To

Aircraft

• General Foods Corp., New York
June 5 filed $5,400,000 aggregate amount

of common
stock
(no par) issuable under the corporation's Em¬
ployee Savings-Investment Plan. Underwriter—None. :
General Instrument Corp.

May 7 filed 57,800 shares of
upon

•

General

exercise

common

certain

and,

Public

corporate purposes.

Underwriter

Fire & Casualty Co.,

Interstate

Bloomington, III.
(par $10)
be/offered for subscription by stockholders of record

March 26
to

Apri|

filed

28,000 shares of capital stock

1 at the rate of 1 3/11 shares for each share held.
per share.
Proceeds—To increase capital

Price—$16.50
and
•

Iprplus.

Underwriter—None.

Johnston Oil &

Gas Co.

(6/16)

May(21 filed 500,000 shares of common stock (par $1).
Price—To be supplied by amendment.'Proceeds—To re¬
pay

jjhdebtedness and for general corporate

Underwriter—Allen

& Co., New York.

purposes.
,

—

(Kan.) Telephone Co.
~
March 3 (letter of notification) $206,000 of 4%% first
mortgage bonds, series A, due Feb. 1, 1977. Price—100%
Junction City

stock (par $1), issu¬
options held by certair
employees of the company. Price—Op¬
tions exercisable
at
$9.50 per share.
Proceeds—Foi
working capital.
able

general

—None.

re¬

block of 400,000 share*
Corp.
UnderwriterLehman Brothers, New York, to handle U. S. sales oi
shares, while Greenshields & Co., Inc., will handle Cansdian distribution of a portion of the offering. Offering
—Temporarily postponed.
Vultee

and its subsidiaries under Employees' Common
Subscription Plan of 1953. Price—$25 per share.

Proceeds—For
common

Price—To be supplied by amendment.

Consolidated

being offered for subscription by certain employees of
Stock

Bids—Tentatively planned for June 29.

executives

Records, Inc.
filed

record

per

re¬

notification) 300,000 shares of common
(par 50 cents). Price—$1 per share.
Proceeds—For

stock

investment

pay

(Texas)

Hartford Special Machinery Co.

shares.

—

common

Maggio

Chase National Bank, 11 Broad St., New York, N. Y.

$1,000

Price—$985 per unit. Pro¬
Business—Water distribu¬

Proceeds—To be

St., Wilmington, Del. Underwriter—Charles J.
Inc., New York. Letter to be withdrawn.

—

The

stock

Coronado Copper Mines
Corp.

Underwriters

stock

Wash.

stock

bank loans and for new- construc¬
To be determined by competitive

Proceeds—To retire

None.

Fairway Foods, Inc., St. Paul, Minn.
May 8 filed $1,600,000 first mortgage lien 4%% bonds
to mature $40,000 annually from 1955 to 1994, inclusive.
Price—At 100% of principal amount. Proceeds—To con¬

(no par)

(to be amended upon, the acceptance of a bid for the
yield $6,000,000).

lowest number of whole shares as will

bidding. Probable bidders: Stone & Webster Securities
Corp.; Merrill Lynch, Pierce, Fenner & Beane and Leh¬
man
Brothers (jointly); Carl M: Loeb, Rhoades & Co.
Bids—To be received up to 11 a.m. (EDT) on June 23 at

l-for-10 basis; rights to

Under¬
Tenn.;

(6/23)

May 20 filed 350,000 shares of common stock

tion.

Electronic Associates,

holders of record June

selling stockholders. Office—Jacksonville, Fla.
writers—Equitable Securities Corp., Nashville,
and R. S. Dickson & Co., Charlotte, N. C:
Gulf States Utilities Co.,

$7.45 per share; and to public, $8.50 per share. Proceeds
repay $279,500 term loan debt and for working
capital. Underwriter—D. A. Lomasney & Co., New York; ;
and Courts & Co., New York and Atlanta, Ga.

—To

Gas Service Co.
(6/29)
May 22 filed 1,500,000 shares of

Jan. 23 (letter oi
notification) 299,970 shares of common
stock (par 10 cents).
Price—$1 per share. Proceeds—
To acquire
leases, for exploration expenses, to repay
loans and for
working capital. Office—100 West 10th

ployees. Stockholders have waived rights to purchase
79,000 shares.
Price—To stockholders and employees,

Feb. 13 filed

50,000 shares of 4% cumulative preferred
(par $100) and 700,000 shares of common stock
(par $5). Price—At par. Proceeds—For
working capital
Business—Production of dairy and poultry feeds. Office
—Ithaca, N. Y. Underwriter—None.

May 27 filed 999,216 shares of common stock (par $2.50).
Price—To be supplied by amendment. Proceeds—To 4C

(par $1)

being offered for subscription by stockholders at rate of
a

/
(6/17)

Gulf Life Insurance Co.

•

two-thirds of

Underwriter—None.

poses.

Harry Hall Co., Safety Bldg., Rock Island, 111.

Friendly Finance, Inc., Paducah, Ky.
May 21 (letter of notification) 21,400 shares of 6% prefererd stock (par $10) and 21,400 shares of class B non¬
voting common stock (par $1) to be offered in units ol
one share of each class of stock.
Price—$12.50 per unit
Proceeds
For operating capital.
Office — 107 South
Fourth St., Paducah, Ky. Underwriter—W. L.
Lyons &
Co., Louisville,' Ky.

Cooperative Grange League
Exchange, Inc.

Ltd., Nassau
;
$1,350,000 20-year 6% first mortgage conver¬
debentures due March, 1973, and 1,565,000 share*

tible

S. C.

tal.

operating capital. Office—2010 Tower Bldg.,
Dallas, Texas. Underwriter—None.

Grand Bahama Co.,

of class A stock (par 10 cents). Price—Par for oeoen-,
(letter of notification) 8,000 shares of common
tures and $1 per share for stock. Proceeds — For ne^
stock (par $10) being offered first to stockholders of *
construction. Business — Hotel and land development
record April 1 at rate of one share for each 6V4 shares
Underwriter—Gearhart & Otis, Inc., New York.
held; rights to expire May 25. Price—$25 per share. Pro¬
ceeds—For working capital. Underwriter—None.
Gray Manufacturing Co., Hartford, Conn.

burg, Fla.

ceeds—For

Sts.,

Washington, D. C. Underwriter—None.

N. W.,

April 9

tion system.

Statement effective about Feb. 13.

Insurance Bldg., 14th and L

Feb. 3 filed

stock.

★ Continental Sulphur & Phosphate Corp.
June 4
(letter of notification) $50,000 of 5% 3-year
promissory notes (convertible into common stock). Pro¬

stockholders oi

working capital. Office-

$15 per share. Proceeds—For

Under¬

of^ preferred stock and one share of common
Price—$3 per unit. Proceeds—For working capi¬
Underwriter—Frank M. Cryan & Co., New York.

12,000 shares of common

the basis of one new share for eacs
held; rights to expire on June 24. Price—

five

writer—None.

common

mulative preferred stock (par $1) and 250,000 shares of
common stock
(no par) to be offered in units of two

Employees Corp.

record April 28 on
'

^ Dividend Shares, Inc., New York
June 5 filed 7,000,000 shares of capital stock (par 250).
investment.

Merrill
clearing agent.

Underwriter—None.

(par $5) being offered to common

Government Employees

Proceeds—For

(letter of notification)

stock

Proceeds—To repay bank loans

Underwriter—Allen

subsidiaries.

Government

May

& Co.

Fischer's

Citizens

per

general corporate purposes.

Lynch, Pierce, Fenner & Beane will act as

of June

and for

vestments

1, with rights to expire on June 17; unsub¬
scribed stock to be offered to officers and employees.

Price—At< market.

Inc., Quincy, III.
March 23 (letter of notification) 2,400 shares of common
stock (par $5). Price—At market (approximately $39.50
per share). Proceeds — To E. Carey, Jr., and W. D* P.
Carey, the two selling stockholders. Underwriters
BosCentral Fibre Products Co.,

for

•
Derby Gas & Electric Corp.
May 14 filed 47,039 shares of common stock (no par),
being offered for subscription by common stockholders
on
a basis of one new share
for each six shares held

Price—$18.75

& Mining Corp.

Central City Milling

mon

11, 1953

The Commercial and Financial Chronicle.. .Thursday, June

(2558)

Utilities Corp.

and

accrued

purposes.

interest.

Proceeds—For

general

corporate

Underwriter—Wachob-Bender Corp., Omaha,

Nebraska.

Kansas Power &

Light Co.

(6/17)

May 6 filed 568,665 shares of common stock (par $5)
being offered for subscription by common stockholders of

May 25 filed 170,000 shares of common stock (par $8.75)
and 50.000 shares of preferred stock (par $100). Price—

record June 2

To be supplied by

at the rate of

shares held; rights to
per

shar^

expire

one

new

share for each

June 24.

Price—$23.50

Proceeds—To reduce bank loans and for in¬

amendment. Proceeds—To

loans and for new construction.
Boston

Corp., New York.

repay

bank

Underwriter—The First

f"..

Volume 177

Number 5228... The Commercial and Financial Chronicle

; Keystone Helicopter Corp,,
Phila., Pa.
April 23 (letter of notification) 295,000 shares of com¬
mon stock (par 10 cents). Price—$1 per share. Proceeds
—-1*0 purchase helicopter and equipment and for work¬

share).

Corp., Wichita Falls, Tex. (6/15)
(letter of notification) 120,000 shares of capital
stock (par one cent). Price—$2.50 per share. Proceeds—
For working capital, etc. Office—Wichita National Bank

York. Underwriter—John R.

Co., Kent, O.
(letter of notification) 7,350 shares of common
stock (par $10). Price—At market. Proceeds—To certain
selling stockholders. Underwriter—Ball, Burge & Kraus,

for each 10 shares held

Under¬

Business—Groceries.
/-v.V

■

•

Proceeds—To

June 25.

Co.

(jointly).

New

shares of

received

to 11

determined

a.m.

(EDT)

22 filed $35,000,000

loans.
>

Underwriters—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Morgan Stanley & Co. Merrill Lynch, Pierce, Fenner &
Beane and Glore, Forgan & Co.
(jointly); Kuhn, Loeb &
Co. Bids—To be received by company up to 11 a.m.

(EDT)

June 23. Stock Offering—Company also plans

to issue and sell to American

its

parent, 700,000
(par $100).

Telephone & Telegraph Co.,
additional shares of common stock

North American Peat Moss Co., Inc.
(6/15-18)
April 10 filed 500,000 shares of ommon stock (par 10
cents). Price — $1 per share. Proceeds — To purchase

A.*Searight, 50 Broadway, New York, N. Y. Telephone

equipment and for working capital. Underwriter-r-R, -A.
Xeppler & Co., Inc., New York. >

Mechanical Handling Systems, Inc.
March 31 filed 120,000 shares of common stock (par $1).

North

Pittsburgh Telephone Co.
June 1 (letter of notification) 2,000 shares of common
stock to be offered for subscription by common stock¬

Price—To be supplied, by amendment. Proceeds—To pur¬
common stock of The Louden
Machinery Co. Busi¬

chase

ness—Manufacture

holders of record June 1 at rate of

and commercial

each

and sale of conveyors in industrial
applications. Office—Detroit, Mich. Un¬
derwriter—Kidder, Peabody & Co., New York. Offering
—Indefinitely postponed.

filed

Corp., Granite City, III.
6% cumulative preferred
stock
of

each

one

Fluorspar.

Underwriter

—

supplied

amendment.

bank loans and for construction program.

Under¬
bidding.
Probable bidders: Halsey, Stuart & Co. Inc.; White, Weld

repay

writers

—

determined

competitive

& Co. and Lehman Brothers

(jointly); Smith, Barney &
Co., Inc. (jointly); Harriman Ripley &
Co., Inc., and Union Securities Corp. (jointly). Bids—
Co. and Blyth &

To be received up to 10:30 a.m.

(EST)

June 15 at 415

Clifford St., Detroit, Mich.

Mid American Oil & Gas Co., Chicago, III.

May 22

(letter of notification) 475,000 shares of com¬
mon stock (par 10 cents). Price—At the market?
(around
15 cents). Proceeds—To G. W. Snyder and G. S. Olmstead,

the

Greenfield

selling

two
&

stockholders.

offered

record

filed

40,000
for

June

oversubscription

shares of

subscription

30,

1953

privilege).

purposes.

stock

(par

l-for-5

supplied

bank loans and for

Underwriters

$5)

stockholders
basis (with an

common

Price—To

amendment. Proceeds—To repay

struction

—

The

First

con¬

Boston

Corp., New York; and the Robinson-Humphrey Co., Inc.,
Atlanta, Ga.
•

share).
Saxonburg, Butler

Northlands Oils Ltd., Canada
21 filed 1,000,000 shares of capital

shares
.

and

warrants

offered in units of

one

purchase

200,000

share of stock and

shares
one

to be

warrant.

Price—75 cents per unit. Proceeds—For drilling of addi¬
wells

and

Los Angeles, Calif.
May 21 filed 372,273 shares of common stock

purchase

producing wells.

Under¬

writer—M.S. Gerber, Inc., New York.

Noryn Mines Ltd., Hull, Quebec, Canada
April 23 filed 500,000 shares of common stock (par $1).
Price—50 cents per share. Proceeds—To repay loans and
for other corporate purposes.

Underwriter—None.

Oregon Fibre Products, Inc., Pilot Rock, Ore.
May 26 (letter of notification) $292,200 of sinking fund
debentures due Jan. 1, 1968 and 5,844 shares of common
stock (par $1) to be offered in units of $100 of deben¬
tures and two shares of stock. Price—$102 per unit. Pro¬
ceeds—For working capital. Underwriter—None.
Otis Oil & Gas Corp., Denver, Colo.
May 21 (letter of notification) 1,500,000 shares of com¬
mon stock
(par five cents). Price—20 cents per share.
Proceeds—For repayment of debt and for working capi¬
tal. Underwriter—Hunter Securities Corp., New York.

Inc.

(amended April 24 to

ucts

from

Peruvian

lands

1,000,000

held

Government.

under

concession

Underwriter—B.

from

the

Phillips

&
j

Co., New York.
«

May 29 (letter of notification) 2,000 shares of capital
stock (no par) to be offered to employees of this com¬
pany in conjunction with offer of a
like number of
shares

Steel

Co.;

share.

beneficial

offer

interest

expires

Proceeds—For

Pittsburgh-Des Moines
30.
Price—$43 per
Office—Neville
Underwriter—None.
June

working capital.

Island, Pittsburgh 25, Pa.

if Pittsburgh-Des Moines Steel Co.
May 29 (letter of notification) 2,000 shares of beneficial
interest to be sold to employees of
company; offer ex¬
pires on June 30, 1953. Price—$17 per share.
Proceeds
For working capital.
Office—Neville Island, Pittsburgh
25, Pa.

Underwriter—None.

Pittston

Co., New York (6/18)
May 20 filed 50,000 shares of 5V2% convertible preferred
stock to be offered for subscription by common stock¬
holders of record June 18 on the basis of one preferred
share for each J3 shares*of-eommo» stock held (with an
oversubscription privilege); rights to expire 20 days from
date of issuance. Price—At par ($100 per share.) Pro¬
ceeds
For working capital.
Business — Natural gas.
—

Undewriter—None.

if Powdercraft Corp., Spartanburg, S. C.
June 3 (letter of notification) 5,000 shares of capital
stock.
Price—At par ($10 per share).
Proceeds—For
working capital. Business—Makes machine parts. Office
746 Hayne St.,
Spartanburg, S. C.
Underwriter—Cal¬

Co., Spartanburg, S. C.

if Pubco Development, Inc., Albuquerque, N. M.
June *3 filed subscription warrants for
302,989 shares
to be issued to present holders of subscription warrants
($1 par* common stock).
Price—To
be supplied by
amendment.
Proceeds—For working
capital.
Under¬
writer—Allen & Co., New York.
Public Service Co. of

(par $1),

for account of company

Packaging Materials Corp., Providence, R. I.
April 29 (letter of notification) $160,000 of 5% deben¬
tures due Dec. 15,
1960, and 2,000 shares of common
3tock (no par) to be offered in units of an $80 debenture
and one share of common stock.
Price—$100 per unit..
Proceeds
For purchase of machinery. Office — 607
Hospital Trust Bldg., Providence, R. I. Underwrite*—
—

Palestine Economic

Corp., New York

May 13 filed 472,301 shares of common stock (no par),
being offered for subscription by common stockholders of
record

June

June
17.

struction

l-for-8

basis; rights to expire on
share. Proceeds—For con¬
Underwriters—Blyth & Co., Inc., -New
a

Price—$31.50
costs.

per

York and San Francisco.

if Raisin Markets, Inc., Los Angeles, Calif.
June 5 (letter of notification) 30,000 shares of class A
stock.
Price—At par ($10 per share).
Proceeds—For
working capital. Office—5320 West 104th St., Los Ange¬
les, Calif. Underwriter—None.

^Remington Corp., Auburn, N. Y. (6/15)
June 1 (letter of notification) 70,000 shares of

common

stock

(par $1). Price—$3.50 per share. Proceeds—For
expansion and working capital.
Underwriter—Carl M.
Loeb, Rhoades & Co., New York.
Resort Airlines, Inc., Miami,

Fla.

ing—Temporarily postponed.

Pennant

'Mutual

Telephone Co., Honolulu
May 18 filed 200,000 shares of common stock being of¬
fered foi subscription by common stockholders of record
1953 and to employees. Price—At

March 6 filed 100,000 shares of common stock

par

($10

per

(par $25).

development of
capital. Under¬

Drilling Co., Inc., Denver, Colo.

Vlarch 23 (letter of notification) 42,507 shares of common
>*ock (par $1).
Price—$1.30 per share. Proceeds—To
Morris

stockholders
242.

rata

pro

Proceeds—For

basis. Price—20 cents per
capital.
Address—Box

working

International Airport,

Miami 48, Fla.

Underwriter

—None.

if Richfield Oil

Corp.,

Los Angeles,

Calif.

June 4 filed $5,700,000 of interests in the Stock Purchase
Plan for Employees of this corporation, together with

100,000 shares of no par common stock which may be
purchased pursuant to the provisions of the Plan.

Ridley Mines Holding Co., Grafton, N. D.
120,000 shares of common stock. Price—At
par ($5 per share).
Proceeds — For working capital.

June 1 filed

writer—None.

Brothers, New York. Offer¬

-r

Indiana, Inc.

share.

Underwriter—None.

loans. Underwriter—Lehman

Concessions Co.,

capital.

Price—$28 per share. Proceeds — For
Israel industry, etc., and for working

June 1,

Oil

March 6 (letter of notification) 724,687 shares of common
stock (par 10 cents) to be offered for subscription by

and
262,273 for account of selling stockholders. Price—To be
supplied by amendment. Proceeds — To reduce bank
are

Peruvian

Jan. 16 filed 9,000,000 shares of common stock

houn &

stock (par 20C
Canadian)
and
subscription warrants for 600,000
shares, which statement was amended May 20 to 200,000

None.

Monterey Oil Co.,

of which 110.000 shares

if Overland Oil & Gas Corp., Bismark, N. D.
(letter of notification) 115,668 shares of common
stock.
Price—$1 per share.
Proceeds—For operating

common

share for

per

June 5

(7/1)
by

—

new

($25

—

Co., Inc., New York.

^ Mobile Gas Service Corp.
June

Underwriter

one

par

—

tional

Michigan Consolidated Gas Co. (6/15)
May 15 filed $20,000,000 of first mortgage bonds due 1978,
Proceeds—From sale of bonds, plus proceeds from sale
of 215,000 shares of common stock (par $14) to American
Natural Gas Co., parent, for $3,010,000, to be used to

Price—At

held.

Nov.

(pai

Price—$6 per unit. Proceeds—For work¬
ing capital. Business—Purchase, processing, refining and

—

113,000 shares of

common

four

Proceeds
For equipment. Office
County, Pa. Underwriter—None.

class of stock.

sale

one

oversubscrip¬
privilege), with rights to expire on July 15; and
then to preferred stockholders.
Price—$1.50 per share.
Proceeds—To retire $65,000 short-term debt and for
working capital. Office—ill Quimby St., Westfield, N. J.

•

WHitehall 3-2181. Offering—Date indefinite.

(par $5) and 113,000 shares of
10 cents) to be offered in units of

June 16 at 67

Telephone Co., New York (6/23)
of refunding mortgage bonds,
series G, due July 1, 1984. Proceeds — To repay bank

Inc.
10,000,000 shares of common stock (par 25
cents). Price—$2 per share. Proceeds—For drilling of
exploratory wells, acquisition of leases and for general
corporate purposes. Underwriter—B. V. Christie & Co.,
Houston, Tex. Dealer Relations Representative—George

itOck

St., New York 4, N. Y.

New York

•

McCarthy (Glenn),

(with

if Pittsburgh-Des Moines Co.

,:May

June 12 filed

Mex-American Minerals

share for each shares held

(par $1)
shares). Price—$2 per
share. Proceeds—For general corporate purposes. Busi¬
ness—Plans to produce and sell petroleum and its prod¬

Underwriters—To

common

Ydrk^ Statement effective June 10. Conversion privilege
expires on July 8.
\

Nov.

stockholders of record June 1 at rate of

common

Underwriter—N one.

Broad

demption price of unconverted shares of $1.05 convert¬
ible preferred stock (154,160 shares as of June
9, 1953),
which have been called for redemption
July 13. Underwriter—Merrill Lynch, Pierce, Fenner &
Beane, New

common

to be first offered for subscription

by Competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Salomon Bros. & Hutzler; Union Securities Corp. and
White, Weld & Co. (jointly); The First Boston Corp.
and Kidder, Peabody & Co.
(jointly); Carl M. Loeb,
Rhoades & Co.; Equitable Securities
Corp.; Kuhn, Loeb
& Co.; Lehman Brothers and
Goldman, Sachs & Co.

Underwriter—

supplied by amendment.
towards payment of the; re¬

applied

oversubscription privi¬

stock (par 25 cents)

tion.

Proceeds—

Price—To be

new

Jersey Power & Light Co. (6/16)
May 7 filed $5,500,000 of first mortgage bonds due 1983.
Proceeds—To repay bank loans and for new construc¬

•

approximately 175181

(par $1).

(with

one

Pennsylvania & Southern Gas Co.
(letter of notification) 98,240 shares of

June 1

tion

stock

Corp. Bids—Tentatively set for 11 a.m.

June 30,

Statement effective May 22.

new

Maryland Casualty Co., Baltimore, Md.

May 22 filed

the basis of

Proceeds

—

exchange for all the outstanding stock of Scranton
Offer expires June 22. Underwriter—None.

Price—$12 per share.

lege); rights to expire

Market Basket, Los Angeles, Calif.
May 25 (letter of notification) 14,886 shares of common
stock (par 50 cents). Price—$11.50
per share.
Proceeds
—For working capital. Office
6014 S. Eastern Ave.,

•

Securities

—For expansion
program.
Underwriters —
Blyth & Co., Inc., Lehman Brothers and Bear, Stearns

Price—

Underwriter—None.

" /

able

(jointly); Merrill Lynch, Pierce, Fenner & Beane. Bids—

Price—To be supplied by amendment.

Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co.;

Kidder, Peabody & Co.; The First Boston Corp.; Equit¬

Electric Co.

holders of record June 11

Lone Star Sulphur Corp., Wilmington, Del.
May 8 filed 600,000 shares of common stock (par 5 cents)
to be offered for subscription by common stockholders of
record May 8 on a share-for-share basis "as a
specula¬

Building, Portland 4, Ore. Underwriter—

• New
England Electric System (6/16)
May 4 filed 828,516 additional shares of common stock
(par $1) to be offered for subscription by common stock¬

writer—None.

None.

bidders:

Underwriters

by competitive biddding. Probable

None.

Angeles, Calif.

determined

Pennsylvania Power & Light Co.
May 1 filed 743,496 shares of common stock (no par),
21,752 shares of 4.40% preferred stock (par $100), 53,248
shares of 3.35% preferred stock (par $100) and 39,936
shares of 4V2% preferred stock (par $100) being offered

stock

—

Link-Belt Co., Chicago, III.
May 22 filed 22.793 shares of common stock (par $5) to
be offered for subscription by "selected group of officers

Los

1983. Proceeds—For construction program.
—To

Office—Times

Lamson & Sessions

For expansion program.

Pennsylvania Electric Co. (6/30)
May 28 filed $12,500,000 of first mortgage bonds due

1,400 shares of 6% non(par $100) and 1,400 shares
of common stock (no par) to be sold in units of one
share of each class of stock. Price—$101 per unit. Pro¬
ceeds
For working capital. Business—Credit service.

May 11 (letter of notification)

H;■

tion."

Boland, New York.

Card, Inc., Portland, Ore.

cumulative preferred

May 20

Proceeds—For working capital.

Underwriter—

costs.

(EDT)

National Credit

Bldg., Wichita Falls, Tex. Underwriter—Aetna Securities
Corp., New York.
' «

$37 per share.

„

•

KLB Oil

and employees of company and its subsidiaries."

expansion

Nagler Helicopter Co., Inc. (N. Y.)
(6/16)
May 26 (letter of notification) 299,000 shares of common
stock (par one cent). Price—$1 per share. Proceeds—
For working capital.
Office—130 West 42nd St., New

May 25

Cleveland,

Proceeds—For

None.

ing' capital. Office—Land Title Bldg., Philadelphia, Pa.
Underwriter—None.
-

(2559)

Replin, the selling stockholder. Underwriter—
Peters, Writer & Christensen,Tnc., Denver, Colo.

Underwriter—N one.
Robertshaw-Fulton Controls

Co.

(6/22)

May 29 filed 160,000 shares of cumulative convertible
preferred stock (par $25).
Price—To be supplied by
amendment. Proceeds—For expansion program. Under¬

writer—Reynolds & Co., New York.

Continued

page

The Commercial and Financial Chronicle.. .Thursday,

(2560)

Continued

None.

from page 51
& Electric Corp.

* Rochester Gas

for

Underwriter—The

construction.

new

May 25 (letter of notification) 275,000 shares of common
stock (par 10 cents). Proceeds—To George W. Snyder,

First

Underwriter—Greenfield &

Jr., President and director.
Co., Inc., New York.

Rights will expire on June 12. Price
Proceeds—To repay bank loans and

shares held.

seven

City, Utah

United Minerals Corp., Salt Lake

stock (no par)
being offered for subscription by common stockholders
-of record May 28 at the rate of one new share for each
May 8 filed 175,000 shares of common

£36.25 per share.

Peoples Gas.Light & Coke Co., has agreed to take
'
;
*

all unsubscribed stock.

May 4 (letter of notification) 115,000 shares of common
stock. Price—At par (10 cents per share).
Proceeds—
equipment. Underwriter — R. L. Hughes &

* Rogers Corp., Manchester, Conn.
(6/22)
May 11 (letter of notification) 10,909 shares of class B
«common stock to be offered for subscription by holders
of class B stock at rate of one new share for each two

For mining

22; rights to expire on June 29.
Proceeds—To retire $100,000 bank
loan and for working capital.
Business — Manufacture
of plastic materials. Underwriter—None.

May 28 filed 1,000,000 shares of common stock (par 5
cents). Price—To be supplied by amendment. Proceeds
—For working capital, etc.
Underwriter—Gearhart &

shares held

Price—$20

Co., Denver, Colo.
U. 8. Airlines,

June

share.

per

Saint Anne's Oil Production Co.

Amendment to be filed.

111.

-cago,

i San

new

Jfor

share.

Inc., San Francisco and New York.
Schlafly Nolan Oil Co., Inc.
March 25 filed 150,000 shares of
•cents). Price—$4

Co.,

•

stock (par 25

L. H. Rothchild &

Co., New York. Offering

Underwriter

Nielsen

—

ferred
Sound

plan.

(6/16)

"Subscriber-Vision."

Underwriter

—

Office

—

one

line.

122,700

reserved

for

sale

common

trustees

the

X953; also 139,762 additional shares

buy

Subsidiaries"

plan

June

Proceeds—For

expansion of

business

and

other

-corporate purposes.

Office—Long Island, N. Y. Under¬
& Co.
and
Childs, Jeffries and
Thorndike, Inc., both of New York.
writers

—

Estabrook

(CI- S.)

Suppiger Co., Collinsville, III.
(letter of notification) 3,750 shares of common
(par $10) and 750 shares of preferred stock (par
£100) to be offered in units of five shares, of common
June 8
stock

and

one

share of preferred.

ceeds—For

working

capital.

Price—$200 per unit. Pro¬
Business—Food packager.

Underwriter—N one.
Texas

Pipeline Co.

May 6 filed 927,273 shares of
be

offered

Price—To
aew

common stock (par
$1) to
subscription by common stockholders.
supplied by amendment.
Proceeds—For

for

construction

and

working capital.

—

Underwriter

Prospective Offerings
Mfg. Co.
May 6 stockholders approved
to

Underwriter—None, the parent to

5,000,000 shares (par $20). It is not presently planned
stock. Underwriter—Pre¬

to issue any of the additional

capital

Price—At par

• Western
Light & Telephone Co., Inc. ;
May 18 filed 78,202 shares of cumulative convertible pre¬
ferred stock (par $25) to be offered for subscription by

stockholders

the basis of

one

new

share for

each five common shares held. Price
To be supplied
by amendment. Proceeds—From sale of preferred stock,
together with funds to be received from sale of $3,000,000
—

,iirst mortgage bonds, to reduce bank loans and for
construction.

Chicago, 111.

Underwriter

Arkansas Power &

March 20 it

—

Harris,

Hall

ferred stock to be offered to stockholders.
per

None.

■>:.

share).
Main

Proceeds

—

stock

Co.,

plant.

and 45,891 shares of $6 preferred stock
per

share. Underwriters—

To be determined by competitive bidding. Probable bid¬
ders. Blyth & Co., Inc, and Equitable Securities Corp.

(jointly); W. C. Langley & Co., and The First Boston
Corp. (jointly); Kidder, Peabody & Co., and Merrill
Lynch, Pierce, Fenner & Beane (jointly); Union Securi¬
ties Corp.
Atlantic

Refining Co.

March 27 it
sue

was

announced that proposed debenture

is¬

later this year will be around

nature

$60,000,000. The exact
timing of the financing are still to be de¬

and

termined.

Stockholders

authorized

debt

ceeds—To

from

used

voted

May

help

struction program for 1953.

for

pay

increase

to $150,000,000.

$75,000,000

the
Pro¬

$100,000,000 con¬

Underwriters—Smith, Barney

& Co. may head group.

Bangor & Aroostook RR.
bid was received by the RFC at Room 1157, 811

One

Vermont
p.m.

Ave., N. W., Washington, D. C., prior to 5:30

(EDT)

May 25 for the purchase from it of $1,-

675,000 of collateral trust 4%
-It

was

refused, however, as it

the

bonds

may

1961.

bonds due July 1,
was

offered

too low. It is possible

again

the

coming

Blue Crown Petroleum

May 12 it
300,000

reported

was

Co., Ltd.
plans to issue and sell

company

common

share. Underwriters

—

Van

Price—95

stock.

cents

per

Alstyne, Noel & Co., New

York, and Walston & Co., San Francisco, Calif. Offering
—Expected in June.
Boston

Edison

Co., Boston, Mass.

June 2 stockholders approved a proposal to offer 246,866
shares of capital stock (par $25) to stockholders on the
basis of

one

new

share for each 10 shares held

oversubscription privilege). Proceedsr—For

new

(with an
construc¬

tion.

Underwriters—To be determined by competitive
bidding. Probable bidders: The First Boston Corp.; Blyth
& Co., Inc.; Smith, Barney & Co.; Harriman Ripley &

Co., Inc. Offering—Expected in July.
Central Power &

Light Co.
2 it was reported company may issue and sell
60,000 shares of new preferred stock. Underwriters—To
be determined by competitive bidding. Probable bidders:
Stone & Webster Securities Corp.; Lehman Brothers
and Glore. Forgan & Co. (jointly); Blyth & Co., Inc.,
Harriman Ripley & Co., Inc. and Smith, Barney & Co.
(jointly); Salomon Bros. & Hutzler.
Corp.

Involve

common

stock.

common

March

voted

stock

debt securities convertible into

Stockholders
to

some

authorize

at
an

the

annual

additional

meeting
1,000,000

of common stock. Underwriters
Kidder, Pea¬
body & Co. and Estabrook & Co. handled offering in
November, 1949, of $6,000,000 2% convertible debentures.
—

Central Illinois Public Service Co..
March 26

was

reported that the company may about

mid-July sell about $6,000,000 additional common stock
(first to common stockholders). Underwriter—The First
Boston Corp., New York.

ized

common

parishes
pre¬

Price—At par

Underwriter—

announced that

portion of the com¬
pany's financing program for 1953-1954 will involve the
sale of $16,550,000 new securities, a portion of which will
was

Inc.,

/ -

Western Saff!owerr Corp.
^
\ '
April 9 (letter of notification) ^OJjOQ, shares of common
stock (par 25 cents). Price—$1.2o'/per. share. Proceeds—
To construct

(no par)

(no par), both callable at $110

Central Louisiana Electric Co., Inc.
April 16 stockholders authorized a block of the author¬

For operating capital.

St./Houston 2, Tex.
:

■>

Light Co.

announced that company may

consider
refunding the outstanding 47,609 shares of $7 preferred
was

new

Offering—Temporarily postponed.

• Western Natural Gas Co., Houston, Tex.
June 8 (letter of notification)
7,030 shares of 5%
(par $30

handled by Blyth & Co., Inc.

was

Bancorporation, Phoenix, Ariz.
June 1 it was announced corporation plans to offer pres¬
ent stockholders the right to subscribe after July 15 for
100,000 additional shares of capital stock on the basis
of one new share for each two shares held. Price — $10
per share. Underwriter—None.

Central Hudson Gas & Electric

be offered for subscription by stockholders of
10 at the rate of one new share for each

common

financing

March 3 it

None.

proposal to increase the

stock from 3,750,000 shares (no par)

common

March

June

Office—1006

Illinois Natural Gas

Of¬

($25 per share). Pro¬
ceeds—To repay debt and for general corporate pur¬
poses. Office—38 Main St., Westerly, R. I. Underwriter—

«stock

ment.

supplied by amend¬

Power Co.

three shares held.

1968, and 40,000 shares of common
(par $1), of which 20,000 shares are for account
<st selling stockholders. Price—To be
supplied by amend¬

To be

stock

unsubscribed shares.

any

record

Statement effective June 8.

due

Underwriters

stock to

stock "for

& Sunrise Supermarkets Corp. (6/25)
•Tune 5 filed $400,000 of subordinate
sinking fund deben¬
tures

—

St., York, Pa. Underwriter—

months.

(par 50
$50 debenture and

common
one

Westerly Automatic Telephone Co.
June 1 (letter of notification) 9,333 shares

during July,

common

Co., Dallas, Tex.

May 20 filed an unspecified number of shares of com¬
mon
stock (no par), sufficient to raise approximately
$7,000,000, to be offered for subscription by common
stockholders (other than West Penn Electric Co., parent).
Price—To be supplied by amendment. Proceeds — For

possible public sale by selling stockholders during the
period of July 1, 1953 to June 30, 1954." Underwriter—
None.

Price

construction program.

par)

Underwriter—

Proceeds—From sale of units and

West Penn

Gearhart, Jr.,

(no

share.

White, Weld & Co. and Union Se¬
Corp., both of New York. Offering—Postponed
indefinitely.

in the "Employees'

stock

per

curities

Sun Oil

and

$27

Line Co., Dallas, Tex.
1,125,000 shares of common stock (par 50
cents). Price—To be supplied by amendment. Proceeds
—Together with other funds, to be used to build pipe¬

Stylon Corp., Milford, Mass.
May 22 (letter of notification) 32,043 shares of common
•stock. Price—At the market (around $1
per share). Pro¬
ceeds—To Joseph Maas,
Newton, Mass. Business—Manu¬

Co.

re¬

West Coast Pipe

by competitive bidding. Probable
Halsey, Stuart & Co. Inc.; Morgan Stanley &
Co.; Kuhn, Loeb & Co.; The First Boston Corp. Bids—
deceived on May 5 but rejected.

Oil

Puget

Nov. 20 filed

determined

of Sun

each

Corp., both of New York.
fering—Postponed indefinitely.

bidders:

Plan

for

Co. and Union Securities

Telephone & Telegraph Co.
April 9 filed $30,000,000 of 24-year debentures due May
1, 1977. Proceeds—To repay advances from American
Telephone & Telegraph Co., the parent. Underwriters—

Hmd

common

1,125,000 addi¬
tional shares of common stock and private sale of $55,000,000 first mortgage bonds, to be used to build a 1,030
mile crude oil pipeline. Underwriters—White, Weld &

Southern Bell

•stock Purchase

share of stock.

ment.

Co., Philadelphia, Pa.
April 27 filed 14,000 memberships

15, 1964, and 580,000 shares of
cents) to be offered in units of

New

Wright, Wood & Co., Phila¬

factures ceramic tile. Underwriter—F. D.
New York.

the rate

West Coast Pipe Line

Socony-Vacuum Oil Co., Inc.
May 19 filed $15,000,000 of interest in company's em¬
ployees' savings plan and 375,000 shares of capital stock
purchasable under the plan. Statement effective June 2.

share to holders who do not elect to

Nov. 20 filed $29,000,000 12-year 6% debentures due Dec.

delphia, Pa.

one-half

Market

Allis-Chalmers

that

15,000 shares of common
(par lOtf). Price—At the market (about $2-$2V2
per share—$2.12y2 per share to underwriter).
Proceeds
demonstrate

D. C. Statement effective June 9.

None.

June 2 (letter of notification)

York City.

and

common

ceive cash at

•stock

—To

(EDT)

Bids—To be received
June 15 at the company's

Washington Water Power Co.
May 7 filed 1,088,940 shares of $1.28 cumulative con¬
vertible preferred stock (par $25) and 1,088,939 shares of
common stock (no par) to be issued in connection with
the proposed merger into company of Puget Sound Pow¬
er & Light Co. on the
basis of one-half share of pre¬

Co., New

Corp.

Securities Corp.

Union

to 11:30 a.m.

Corp.
May 22 filed $10,500,000 of participations in employees
•savings plan, together with 210,000 shares of no par com¬
Skiatron Electronics & Television

Co.;

office in Washington,

Sinclair Oil

stock of corporation issuable under

Underwriters—

by competitive bidding. Probable bid¬
Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co. and
AUyn & Co. Inc. (jointly); Merrill Lynch, Pierce,
Fenner & Beane and Stone & Webster Securities Corp.
(jointly); Equitable Securities Corp.; Kidder, Peabody

York, N. Y.

mon

construction.

new

ders:

Manufacturer of electronic and electro-me¬

devices.

Proceeds—For

West

owned

None.

A. C.

(Edgar L.), Inc. (N. Y.)
May 25 (letter of notification) 298,000 shares of comxnon stock (par one cent). Price—$1 per share. Proceeds
—To acquire plant, machinery and equipment; and for
working! capital. Office—10-15 Spruce St., New York.
—

(6/15)

To be determined

Scillitoe

chanical

Washington Gas Light Co.

1978.

Indefinitely postponed.

Business

America, Davenport, Iowa
notification) 10,000 shares of common
$10 per share. Proceeds — For working

May 20 filed $7,000,000 of refunding mortgage bonds due

leaseholdes, royalties and producing properties, to
prospect for oil and gas and to develop and operate
producing properties. Office—Mt. Vernon, 111. Under¬
—

—

Arizona

Walburt Oils Ltd., Toronto, Canada
April 24 filed 660,000 shares of common stock (par $1)
which 550,000 shares will be offered in the United
States and 110,000 shares in Canada. Price — $1.02 per
share in U. S. and $1 per share in Canada. Proceeds—
For general corporate purposes. Underwriier—Sidney S.
Walcott, President of company, Buffalo, N. Y.

i«ell

writer

'■

common

Price

stock.

share. Proceeds—To purchase and

per

capital. Underwriter—A. J. Boldt & Co., Davenport, la.

bank loans and

Underwriter—Blyth

program.

;;;

Vault Co. of

share for each three

Proceeds—To retire

construction

Underwriter—George F. Breen,

March 2 (letter of

(with rights to expire July 2); employees to
"be entitled to purchase unsubscribed shares.
Price—
per

Office—127

vious

•shares held

£13.30

(with an oversubscrip¬
tion privilege); rights to expire July 14. Price—$40 per
share. Proceeds—From sale of stock, together
wi|Ji $600,000 to be received from sale of first mortgage bonds to
repay $600,000 bank loans and for new construction.

authorized

New York.

of one new

stockholders of record June 17 at rate

J. A. Numero. President.

May 20 filed 800,000 shares of common stock (par $10)
to be offered for subscription by common stockholders
one

mon

£ U. S. Thermo Control Co., Minneapolis, Minn.
June 5 (letter of notification) 20,000 shares of common
stock (par $1).
Price—$3.25 per share. Proeeeds—To

Diego Gas & Electric Co.

•of record June 9 at rate of

York County Gas Co. (6/24)
May 25 (letter of notification) 6,000 shares of common
stock (par $20) to be offered for subscription by com¬

(6/18)

Inc., New York

Otis, Inc., New York.
April 23 filed 270,000 shares of common stock (par $1).
.Price—$5 per share.
Proceeds—To acquire stock of
Neb-Tex Oil Co., to pay loans and for working capital.
Office—Northwood, Iowa. Underwriter—Sills, Fairman
»& Harris and H. M. Byllesby & Co., Inc., both of Chi-

Co.,

Underwriter—E. I. Shelley

Colorado Springs, Colo.

Denver, Colo.

share for each

United Mining & Leasing Corp.
Central City, Colo.

Boston

Corp., New York.

June 11, 1953

Office—Fi?g^ Rational Bank Bldg.,

stock for

which

the

issuance and sale locally in the

facilities

the

company

are

located, such stock not to exceed $300,000 in aggregate
market value. They also approved issuance of securities
convertible into shares of any class of capital stock.

Central Maine Power Co.
Jan.

it was reported company plans sale later this
of $10,000,000 common stock (in addition to $10,000,000 of 1st & gen. mtge. bonds sold March 10, 1953),
after distribution by New England Public Service Co. ol
2

year

its holdings of Central Maine Power Co. common

stock.

Probable bidders: Blyth & Co., Inc. and Kidder, Peabody

Number 5228... The Commercial and Financial Chronicle

Volume 177

(2561)

& Co.

(jointly); Coffin & Burr, Inc.; A. C. Allyn & Co.,
& Co. (jointly); Harriman Ripley

Inc. and Bear, Stearns
& Co., Inc.

Feb. 20 it

Baltimore

sion

000

petitioned the Maryland P. S. Commis¬
authority to issue and sell $15,000,000 of de¬

company

for

Proceeds—From sale of

bentures.

debentures, plus $25,-

000,000 to be received from sale of common stock to
American Telephone & Telegraph Co., parent, for re¬
payment of loans and for new construction.
Under¬
writers'— To be determined by competitive bidding.

Halsey, Stuart & Co. Inc.; Kuhn, Loeb
Co.; Morgan Stanley '& Co.; The First Boston Corp.;
Harriman Ripley
Co. Inc. and Alex. Brown & Son
(jointly). Bids—Expected to be received in July.
&

Chicago, St. Paul, Minneapolis & Omaha
Ry. (6/18)
Bids will be received by the company at 400 West Madi¬
St., Chicago 6, 111., up to noon (CDT) on June 18
purchase from it of $1,170,000 equipment trust
certificates to mature annually on July 1 from 1954 to
son

the

inclusive.

1968,
Co.

Halsey, -Stuart

bidders:

Probable

Inc.; Salomon Bros. & Hutzler; R. W. Pressprich &

Co.

Cincinnati Gas & Electric Co.
'

March

the

revealed

was

plans to raise

company

$35,000,000 through sale of new securities (mostly
Proceeds—For

•determined

bonds).4

Underwriters—To be

construction.

new

competitive bidding. Probable bidders
•for bonds: Halsey, Stuart & Co. Inc.; Morgan Stanley &
rCo.; Kuhn, Loeb & Co. and Salomon Bros. & Hutzler
by

(jointly); Blyth & Co., Inc., and The First Boston Corp.
(jointly); Union Securities Corp.; Glore, Forgan. & Co.
and White, Weld & Co. (jointly); W. C. Langley & Co.;
Lehman Brothers; Harriman Ripley & Co., Inc.; Merrill
'Lynch, Pierce, Fenner & Beane.
Previous equity fi¬
nancing was underwritten by Morgan Stanley & Co. and
W. E. Hutton & Co.
Jan. 9 it

was

•

April 14

was

collateral

announced company

plans sale of $7,000,-

trust

City Bank & Trust Co. of Reading,

El Paso Natural Gas Co.
25 it was announced
company plans to place
privately $120,000,000 of first mortgage bonds and sell
publicly 200,000 shares of preferred stock and $25,000,000 debentures.
Underwriter—White, Weld & Co., N. Y.

Price—$30

per

issued.

additional shares of

of
an

Fort Worth

June 2 it

April 6 it

was

announced company plans to issue and
sell later this year $40,000,000 of new debentures. Pro¬
repay

bank loans and for construction pro¬
gram. Underwriters—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Morgan Stanley & Co.
Commonwealth Edison Co.

May

(7/8)

planned

mortgage bonds, due 1983.

Proceeds—To help pay cost
of new construction, which, it is estimated, will total ap¬
proximately $500,000,000 during the four years through

1956, of which about $280,000,000 will be obtained from
the

sale

Underwriters—To

securities.

new

de¬

termined

by competitive bidding. Probable bidders: Hal¬
Stuart & Co. Inc.; Kuhn, Loeb & Co., Lehman
Brothers, and American Securities Corp. (jointly); The
sey,

First Boston Corp.; Glore, Forgan & Co. Bids—Tenta¬
tively scheduled to be received about July 8. Registra¬
tion—Expected on June 11.

National

Consumers

Power

Co.

(Mich.

(7/16)

•

derwriter—To

determined

competitive

bidding.

Probable bidders:

Halsey, Stuart & Co. Inc.; Harriman
Ripley & Co., Inc. and The First Boston Corp. (jointly);
Kuhn, Loeb & Co. and Union Securities Corp. (jointly);
Morgan Stanley & Co.; White, Weld & Co. and Shields
&

Co.

(jointly). Bids

—

Expected

received

the

stockholders approved

authorized

preferred

proposal to increase

stock from

200,000 shares to
300,000 shares (par $100). Probable bidders for any new
preferred stock financing may include Blyth & Co., Inc.,
and The First Boston
and

Shields

Corp. (jointly); White, Weld & Co.

Co.

(jointly); Lehman Brothers; W. C.
and Union Securities Corp. (jointly);

Langley & Co.
Morgan Stanley & Co.
it

possible that

Stuart Cooper,
stock

common

may

President, said
be sold later in

the year.

Denver & Rio Grande Western RR.
Bids

are

about

expected to be received by the company on or

Aug.

Nov.

it of $3,300,000
semi-annually from
1, 1953, to May 1, 1968, inclusive, and on or about

Oct.

equipment
of

for

trust

the

purchase

certificates

amount

from

due

said

certificates.

bidders:

Halsey, Stuart & Co. Inc.;
Hutzler; Kidder, Peabody & Co.

Salomon

Probable

Bros.

Detroit Edison Co.

March 24 it

was announced
company plans to issue an
unspecified amount o.f convertible debentures due 1963

(about $55,000,000 to

4%)

which

may

carry an

first

interest rate not exceeding
for subscription by

offered

stockholders. Proceeds—To retire bank loans and to meet

National

stockholders

Bank

record

were

Price—$8
bottling

new

Detroit

offered

—

total ef

one-for-liv*

on a

Proceeds—To increase capital and surplus,

$50 per shares
Underwriter*

Michigan Corp.

Menabi Exploration Co., Inc.*
Houston, Tex. /
April 8 it was announced company plans to issue and
sell $1,000,000 of convertible debentures.
Proceeds—Tte

Bank, Fort Worth, Tex.

announced stockholders will vote June 16

April 27 it

Minneapolis-Honeywell Regulator

Webber,

Jackson

Securities

states

476

issue of 3,000 shares

that, under present plans, these shares will be is¬
the growth of the corporation warrants.

Greenwich Gas Co.

the

Connecticut

issue

Commission

authorized

sell

and

Corp., New York.

& Light Co.'s $6 preferred stock
shares are now

Washington, D. C.

a
proposal increasing
(par $1.50) from 3,440,000 to

Mississippi Power & Light Co.
March 20, E, H. Dixon, President of Middle South
Utili¬
ties, Inc., announced that refunding of Mississippi Power

Curtis and Stone & Webster Securities Corp.
March 18 stockholders authorized

Co.

approved

stock

common

3,950,000 shares and the preference stock (par $100) from
160,000 to 210,000 shares.
Immediate issuance of in¬
creased stock not planned.
Underwriter—Probably Union

Kentucky

Probably Paine,

—

stockholders

authorized

reported early registration is expected
of 50,000 shares of cumulative preferred stock
(par $50).

Underwriters

(no par), of which 44*may be
consideredL

outstanding,

This issue is callable at $110 per share.
Underwriters—
To be determined by competitive
s

bidding. Probable bi&Blyth & Co., Inc., and Equitable Securities Corp*
(jointly; W. C. Langley & Co., and The First Boston
Corp. (jointly); Kidder, Peabody & Co., and MerrfH
Lynch, Pierce, Fenner & Beane (jointly); Union Securi¬
ders:

ties Corp.

$200,000 of first mortgage
bonds and $483,000 par value of common stock
(the
latter first to stockholders). Proceeds—To retire bank

Dec

loans. Underwriter—F. L. Putman & Co., Boston, Mass.

sale

•

bonds.

Gulf Interstate Gas Co.

June 8 it
of

was reported that early registration is
expected
$13,600,000 of 5V2% notes and 3,400,000 shares of com¬

stock to be offered in units of $20 of notes and five
of stock initially to stockholders of Panhandle

Eastern

Pipe Line Co.

Price—$48.75 per unit. Proceeds
—From sale of these securities, together with
$96,000,000
to

be received from sale of first mortgage

18 insurance

4^8%

bonds

companies, led by Metropolitan Life In¬
surance Co., to be used to pay for new construction.
Un¬
derwriter
Carl M. Loeb, Rhoades & Co., New York.
Offering—Of units, expected late in June.
—

•

Industrial National Bank

(Detroit)
May 29 have right to subscribe
on
or
before June 26 for 25,000 additional shares of
capital stock (par $10) on the basis of one new share
for each eight shares held.
Price—$30 per share. Pro¬
Stockholders of record

increase

capital and surplus.

Inc.,

Cambridge,

publicly 131,784 additional shares of common stock fol¬
lowing hearing to be held by SEC on June 15. Proceeds
—For expansion. Underwriter — Lee Higginson
Corp.,
New York and Boston
Iowa Electric

writers

(Mass.).

Light & Power Co.

reported company may sell in June some
and preferred stock and/or debentures. Under¬

—

was

For stock: The First Boston

Walker & Co., both of New York.
was

Corp. and G. H.
Previous debt financ¬

done privately.

Iowa-Illinois Gas & Electric Co.

May 15 it was reported company may issue and sell
early in 1954 abo'ut $6,000,000 aggregate amount of com¬
mon

stock. Underwriters—To be determined by competi¬

tive

bidding. Probable bidders: Lehman Brothers; The
First Boston Corp.; Merrill Lynch, Pierce, Fenner &
Beane, Harriman Ripley & Co. Inc.
May

was

reported

company

may

about $4,750,000 first mortgage bonds.
pay

$800,000

bank

loans

and

for

issue

and

sell

Proceeds—To
new

re¬

construction.

Underwriter—Central Republic Co., Inc., Chicago, 111.

Long Island Lighting Co.
April 21 it was announced that company this Fall plans
to issue and sell in the neighborhood of 600,000 shares
of new common stock to be followed in the latter part of
the year by an issue of about $25,000,000 of first mort¬
gage bonds
(this is in addition to 100,000 shares of
series C preferred stock, par $100, offered publicly on
May 7). Proceeds—To repay bank loans and for new
construction. Underwriters
(1) For common stock,
probably Blyth & Co., Inc. and The First Boston Corp.

was
announced company plans issuance
the middle of 1953 of
$10,000,000 first

and

mortgag*

ly); Kuhn, Loeb & Co.; Kidder, Peabody &
White, Weld & Co. (jointly); Glore, Forgan &
man

Brothers;

Equitable

Securities

curities

Corp.;

Co.

and

Co.; Leh¬

Union

Se¬

Corp. and Salomon Bros. & Hutzler
(jointly);;
Lynch, Pierce, Fenner & Beane; Harriman Rip¬
ley & Co., Inc.
„

Merrill

Montana-Dakota Utilities Co.
May 2 it was announced company plans to issue and
sell in 1953
approximately $8,000,000 of first mortgage

bonds.^ Proceeds—For 1953

construction program. Un¬
be determined by
competitive bidding. 1
Probable bidders: Halsey, Stuart & Co.
Inc.; Blyth & Cou.

derwriters—To

Inc., Merrill Lynch, Pierce, Fenner & Beane
Weld & Co. (jointly).
Natural
mon

June 4 it was announced company,
a
subsidiary of
American Research & Development Corp., plans to offer

ing

near

Underwriters—To be determined by
competitive
bidding. Probable bidders: Halsey, Stuart & Co.
Inc.
W. C. Langley & Co. and The First Boston
Corp. (joint¬

Underwriter—

Mass.

Monongahela Power Co.

May 29 it

-4r Ionics,

writer—Kidder, Peabody & Co., New York.

was

Kansas-Nebraska Natural Gas Co., Inc.

(8/3)

—Watling, Lerchen & Co. and First

Securities Co. and First Southwest Co., both of Dallas.

common

Delaware Power & Light Co.

April 21

Manufacturers

April 28

April 13 it

July 16.

stock to its stockholders at

60,000 shares of capital stock (par $20)
basis; rights to expire June 23. Price

None.

applied to Michigan P. S. Commission
for authority to issue and sell $25,000,000 of 30-year first
mortgage bonds. Proceeds—For new construction. Un¬
company

common

shares for each share held.

new

offered for subscription by stockholders on a one-for-six
basis. Price—$20 per share. Underwriters—Dallas Union

ceeds—To
•

May 29

Under¬

finance development of oil properties in Ecuador. Under-.

mon

Willis Gale, Chairman, announced company
to issue and sell an issue of $40,000,000 first

bonds.

approving a proposal to split-up the present outstand¬
ing 300,000 shares of capital stock on a two-for-one
basis, following which 100,000 additional shares will be

company

was

ceeds—To

Inc.

mortgage

—

June

May

Columbia Gas System,

first

share. Proceeds
To help finance
plant. Underwriter—None.

unsubscribed shares. Proceeds—To retire
$2,190,000
Georgia Railroad & Banking Co. debentures held by
insurance firm. Underwriters—Johnson,
Lane, Space
Co. and Joseph Walker & Sons.
"
,

of four

per

the

Proceeds—To increase capital and

share.

surplus.

determined

rate

Banking Co.
exchange for each share held, one share of the new
company's stock, the right to subscribe within 30 days
for 13 additional shares at $4.10 per share and a
$250
collateral trust 5% bond due May 1,
1990; the offer to
become effective upon acceptance by 95% of the out¬
standing stock. An additional 210,000 of the new shares
would be purchased by the
underwriters, plus any of

Government Employees Corp.,

Pa.

will

—

Maier Brewing Co., Los Angeles, Calif.
April 18 it was announced company will offer 400,00b

sued

fractional

announced company may issue and sell

First Railroad & Banking Co. of Georgia
was announced that this new
company will
offer stockholders of Georgia Railroad &

May 4 it

two

held.

was

$12,000,000

by competitive bidding
Probable bidders: Halsey, Stuart & Co.
Inc.; Kuhn, Loeb
& Co., Lehman Brothers and A. C.
Allyn & Co., Inc*.
(jointly); Blyth & Co., Inc.; White, Weld & Co. andl
Shields & Co. (jointly); Salomon Bros. &
Hutzler; W.
C. Langley & Co., The First Boston
Corp., and Glore^
Forgan & Co. (jointly); Merrill Lynch, Pierce, Fenner
& Beane and Kidder, Peabody & Co.
(jointly); Harri¬
man Ripley &
Co., Inc.; Equitable Securities Corp.

of preferred stock (par $100) to carry a cumulative divi¬
dend rate not to exceed 6% annually. The management

June

writers

March

have war¬
rants mailed to them entitling them to subscribe on
or before July 15 for 15,000 additional shares of capital
stock (par $10) on the basis of one new share for each

Louisiana Power & Light Co.
March 20 it

Corp. (jointly); The
First Boston Corp., White, Weld & Co. and
Kidder, Peabody & Co. (jointly); Glore, Forgan & Co. and Harriman
Ripley & Co. Inc. (jointly).

General Telephone Co. of

reported company plans issuance and sale

about

June 1 shareholders of record May 15 were to

(jointly). (2) For bonds to be determined by com¬
petitive bidding. Probable bidders: Halsey, Stuart &
CO»
Inc.; Blyth & Co., Inc. and The First Boston CorpL
(jointly); W. C. Langley & Co.; Smith, Barney & Co.

Underwriter—None.

Tex.

500,000 shares of common stock. Price—Ex¬
pected to be around $10 per share. Underwriter—Hayden, Stone & Co., New York. Offering—Postponed.

debentures.

Co. and Stone & Webster Securities

Cinerama Productions Corp.
of

Meeting—Stockholders

new

mortgage bonds due 1973.
Under¬
writers—To be determined by competitive bidding. Prob¬
able bidders: Halsey, Stuart & Co. Inc.; Estabrook &

Probable bidders:

for

costs.

authorized the

Eastern Utilities Associates

Chesapeake & Potomac Telephone Co. of

May 1

construction

Gas

held.

Corp.

was announced company

stockholders

stock

Oil

and White,

plans to offer to com¬
450,000 additional shares of common

the basis of

Proceeds

—

one

For

new

share for each four share*

construction.

Underwriter

None.

Mississippi River Fuel Corp., which owns one-half
Gas & Oil common
stock, will subscribe to
its share plus any unsubscribed
shares. Offering — Ex¬
pected early in July.
of

Natural

New York, Chicago & St. Louis RR.
(6/17)
Bids will be received
by the company up to noon (EDT)
on June 17 for the
purchase from it of $3,150,000 equip¬
ment trust certificates to be dated
July 15, 1953 and
mature annually to and
including July 15, 1968. Prob¬
able bidders:
Halsey, Stuart & Co. Inc.; R. W. Press¬
prich & Co. Salomon Bros. & Hutzler.
New York State Electric & Gas
Feb. 27 it
issue

was

and sell

Corp.

reported that company may, later in 1955L
$20,000,000 first mortgage bonds

(following

private sale of

75,000 shares of 4.40% preferred
stock*
$100 in February and $5,000,000 of 3%% debenture*
due 1991 in April).
Underwriters—To be determined by
par

competitive bidding. Probable bidders:
Halsey, Stuart
& Co. Inc.; The First Boston
Corp. and Glore Forgan.
& Co.
(jointly); Blyth & Co., Inc. and Smith,

Barney
(jointly); Hemphill, Noyes & Co. and Drexei
(jointly); Kidder, Peabody & Co. and Salo¬
mon Bros. & Hutzler
(jointly); Lehman Brothers; Har¬
riman Ripley & Co., Inc.
&

Co.

Northwest Natural Gas Co.
March

23 it was reported that this
company plans to
finance its proposed 1,300-miles
pipeline from Canada to
the Pacific Northwest by the issuance and
sale of $66;000,000 of 4%% first mortgage pipeline bonds to insuxv
ance companies and other institutional
investors and

000,000 of 5% debentures and 1,400,000 shares of

$9,-

common

—

Continued

page 54

The Commercial and Financial Chronicle...

Thursday, June 11, 1953

(2562)

Continued from page
stock at $10 per share

publicly in the United States and
Stanley & Co., New Yofk.

Ormond Corp., Albuquerque,
10

was

the SEC

with

querque.

N. M.

announced company plans to register
issue of stock, which will be offered

Central Avenue, N. E., Albu¬

Office—5003

nationally.

N. M.

Corp.
Jan 29 company received FPC permission to file a third
substitute application proposing to construct a 1,466mile transmission line extending from the San Juan
Basin in New Mexico and Colorado to market areas in
the Pacific Northwest.
Estimated overall capital cost
of the project is $186,000,000, including $2,000,000' for
working capital. Financing is expected to consist of first

and preferred and common
Underwriters—White, Weld & Co. and Kidder,
Peabody & Co., both of New York, and Dominion Secu¬
rities Corp. Ltd., Toronto, Canada.
mortgage pipe line bonds

stocks.

Pacific Telephone & Telegraph Co.
17 Mark R. Sullivan, President, announced

Dec.

additional common stock. Probable
bidders for bonds: Halsey, Stuart & Co., Inc.; Morgan
Stanley & Co.; White, Weld & Co.; Lehman Borthers and
Union Securities Corp. (jointly).
Stock would be of¬
fered to stockholders, without underwriting.
American
Telephone & Telegraph Co., parent, owns 91.25% of
ing of bonds and

Pacific

common

Permian

shares.

Pipeline Co., Chicago, III.
amended application with FPC
for authority to construct a 163-mile pipeline system at
an estimated cost of $40,269,000. Financing may be done
privately. Underwriters — Stone & Webster Securities
Corp. and Glore, Forgan & Co., both of New York. Of
the stock of this company, 51% is now owned by North¬
ern

South Carolina Natural

Feb.

South Georgia Natural Gas Co.
19 it was announced a FPC Presiding

Feb.

announced company plans to issue and
approximately $5,000,000 of bonds and suf¬
ficient common shares to raise about $4,000,000. Proceeds
—To repay bank loans and for new construction. Under¬
was

—

determined

competitive

bidding.

Probable bidders: For bonds, Halsey, Stuart & Co. Inc.;
The First Boston Corp. and Coffin & Burr, Inc. (jointly);

Kidder, Peabody & Co.; White, Weld & Co. For stock:
Kidder, Peabody & Co. and Blyth & Co., Inc. (jointly);
Harriman Ripley & Co. Inc.

Southern California Edison Co.

April 23, William C. Mullendore, President, stated that

issue and sell
40,000 shares of new preferred stock (par $H)0)r Under¬
writers
To be determined by competitive bidding.
Probable bidders: Glore, Forgan & Co.; Smith, Barney
& Co.; Kuhn, Loeb & Co.; Harriman Ripley & Co., Inc.,
and Central Republic Co.
(Inc.). Proceeds—For addi¬
tions and improvements.
—

Public Service Electric & Gas Co.
Feb. 25 it was announced company plans issuance and
sale in June of $50,000,000 of first refunding mortgage

bonds. Proceeds—To repay bank loans and for

is considering selling sufficient securities later
raise approximately $30,000,000. Proceeds
Underwriters—May be
determined by competitive bidding. Probable bidders for
bonds: Halsey, Stuart & Co. Inc.; The First Boston Corp.
and Harris, Hall & Co. (Inc.) (jointly); Blyth & Co., Inc.;
Kuhn, Loeb & Co. Probable bidders for preferred: The
First Boston Corp. and Harris, Hall & Co. (Inc ) (jointly).
company

in the year to

June 24 for the

issue
stock

by competitive bidding. Probable bidders: White, Weld
& Co. and Kidder, Peabody & Co. (jointly); W. C. Langley & Co and Paine, Webber, Jackson & Curtis (jointly);
Harriman Ripley & Co. Inc.; Merrill Lynch, Pierce,
Fenner & Beane and Union Securities Corp. (jointly);
Lehman Brothers; Blyth & Co. Inc., and Stone & Webster
Securities Corp. (jointly).
v-v '^^ // ^j^.-

Strategic Materials Corp., Buffalo, N. Y.
was reported company plans to offer for sub¬

scription by its
additional

common

stockholders about $1,000,000 of

stock. Underwriters—Hamlin & Lunv

Buffalo, N. Y., and Allen & Co., New York.

securities

sufficient to

raise several

millions

approximately $27,000,000 will be required
financing in the future in connection
$35,300,000 construction program planned for

Seeck & Kade, Inc., New York

an¬

nounced that bids would be received
up to 3 p.m. (EDT)
on June
30 for the purchase from the

capital to finance two new manufacturing division
projects in each of which it would own a 50% interest
Underwriter—Eastman, Dillon & Co., New York.

April 21

stockholders

the authorized

Probable bidders for bonds:

and

amend

stock from

the

provide that the limit on the amount of unse¬
cured
indebtdeness that the
company
may
create,
as

without consent of majority of the preferred stockhold¬
ers shall be 20%
(instead of 10%) of the aggregate oi

company's secured indebtedness and capital
Charles E. Ide, President, stated that the
has no present plans to issue new common
First Boston Corp. and
Collin, Norton &
any

common

bonds:

and surplus
managemenl
shares.

stock

financing.
Halsey, Stuart & Co. Inc.; The First Boston

penditures in 1954 and 1955 may Baltimore and adjacent territory.
approximate
this year's figure. The area served with electricity
Funds required to carry out the contains
approximately 2,285
proposed construction program, in square miles with an estimated
addition to those provided through population of about
1,500,000, and
the
current
financing, are ex- the area
served with gas contains
pected to be provided by accruals
Halsey, Stuart & Co. Inc. and to reserves, and through the fur- about 267 square miles with an
associates
are
estimated population of 1,250,000.
offering
today ther issuance of securities.
(June 11)
$25,000,000 ConsoliThe new bonds are to be reOperating revenues of the com¬
dated Gas Electric Light & Power deemable at
regular redemption
pany
aggregate
$90,868,674 ; for
Co. of Baltimore first
refunding prices ranging from 105.24% to
mortgage
sinking
fund
bonds, par, and if redeemed through the 1952; gross income was $13,604,541
!?J3es Y 3/8%, due June 1, 1983. sinking fund, at prices ranging and net income was $10,139,982.
Offered at 102.239% and accrued from
102.24% to par, plus accrued
interest, the bonds were won by interest in each case.

Offer Consol. Gas

El. Lf. & Pow. Bonds

nPtiti^de/Xrin^gT,lr°UoP „a 4 CT,' Consolidated Gas Electric Light
nf fi4Qqqq£ JU°e 9 °n a bld& Power Co. of Baltimore is

COMING

gaged principally in the business
of producing and selling electricity and gas within the State of

EVENTS

proceeds from
bonds

the

will

sale

used

of
for

The

Co. handled
Probable bidders on

Halsey, Stuart Group

new

Hal¬

proposal to increase
5,000,000 to 7,500,000
articles of incorporation so

approved

common

Investment

announced company plans to issue and^gell
about $20,000,000 of common

was

stockholders

common

stock

l-for-15 basis (with an

on a

oversubscription priv¬

ilege). Proceeds—For 1953 construction program. Under¬
writer— None. Offering —r Tentatively scheduled: for
'

late in June

/ .,'-r

United Gas Corp.

announced company (in addition to aboveproposed stock offering) plans to issue "and
sell about $30,000,000 of debentures. Proceeds—For 1953
construction program. Underwriters—To be determined
by competitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; Morgan Stanley & Co,, White, Weld
Co.
and Equitable Securities Corp. (jointly) ; The First Bos¬
ton Corp., Harriman Ripley & Co. Inc. and Goldman,
May 1 it

was

mentioned

(jointly). Offering—Expected later in i953

Sachs & Co.

Walworth Co.
March
and

stockholders

increase

voted

authorized

stock from 1,900,000 shares to 2,500,000 shares

common

grant directors right to issue all or part of in¬
stock without prior offering to stockholders;
reserve part of the additional shares for issue
conversion of convertible 3%% debentures due

creased
also

May 1,1976. Underwriter—May be Paine, Webber, Jack¬
son
& Curtis, New York and Boston.
r

Washington Water Power Co.
April 10 it

announced directors have approved the
in May of $10,000,000 of first mort¬

was

sale

and

$18,000,000 of debentures. Proceeds—
of bank loans and to redeem 3$,000
shares of $6 preferred stock at $110 per share. Under¬
writers.—If competitive^ bidders may include: Halsey,
bonds and

To repay $24,000,000

Stuart

& Co.

Inc.; Union Securities Corp. and Lehman
(jointly); Blyth & Co., Inc., Smith, Barney &

Brothers
Co. and

White, Weld & Co (jointly); W. C. Langley &
Corp. (jointly). However, both
issues may be sold privately through Kidder, Peabody
Co, and The First Boston

& Co.

■

■"n

■

■■■•

..}

Westcoast Transmission

April 10 it

stated company may-4sstteT add sell $59,-.

was

000,000 of 4% first mortgage bonds to insurance com-**
panies (including Prudential Insurance Co. of America,
New York Life Insurance Co.; Northwestern Mutual Life
ancLjseveral

Co.

Canadian

companies); $25,-

to 4% short-term notes to the National

000,000 of 3%

City Bank of New York; and about 3,500,000 shares of
stock for about $30,000,000.
Proceeds—To fi¬
nance construction of a natural gas pipe line from the
Canadian Peace River field to western Washington: and
Oregon. Underwriter—Eastman, Dillon & Co., New York.
common

West Texas Utilities Co.

was

Stuart & Co. Inc.; Stone & Webster Securities Corp.
White, Weld & Co. (jointly).

latest

Government of

Net

March

Field

general

York

Beach Club,

reported that company plans issuance

was

shares of new preferred stock. Under¬
determined by competitive bidding.
bidders: Stone & Webster Securities Corp.;

Probable

Harriman Ripley & Co., Inc.; Union Securities Corp.

Wisconsin Public Service Corp.
was reported that the company may, late'this

March 17 it

early in 1954 issue and sell some common stock
out its financing program. Underwriter—May
First Boston Corp. and Robert W. Baird & Co.
(jointly).

year or

round

The

Worcester Gas

April 2 it

was

Light Co.

announced company has applied to the

Massachusetts Department of Public Utilities for author¬
ization to issue and sell $3,000,000 of 20-year first mort¬
gage bonds.

Proceeds—To retire bank loans, etc.

Under¬

writers—To be determined by competitive bidding. Prob¬
able

bidders:

Halsey,

Stuart

Inc.;

Co.

First

Boston

Corp.: Blyth & Co.. Inc.: Kidder. Peabody & Co

(New York City)

Bond

Annual

Westchester

writers—May be

June 12, 1953

Municipal

and sale of 100,000

Toledo Edison Co.

1953 and 1954.

the

of dollars

Webster
Si

United Gas Corp.

Insurance

Sunray Oil Corp.
May 13 company disclosed it is planning to issue and sell

and

additional

was

—Probably White, Weld & Co. and Stone &
Securities Corp., both of New York .
/

gage

announced company later this year will
and sell 50,000 shares of cumulative preferred
(oar $100).
Underwriters — May be determined
was

Corp.

reported company may issue some con¬
vertible preferred stock before the Fall.
Underwriters

issuance

Bros. & Hutzler.

sey,

SEC),

(6/30)
Attorney General of the United States

Transcontinental Gas Pipe Line

May 4 it

upon

(EDT)
purchase from it of $8,445,000 equip¬
ment trust certificates to be dated July 1, 1953, and to
mature in 15 equal annual instalments from 1954-1968.
Probable bidders: Halsey, Stuart & Co. Inc.; Salomon
on

short-term bank loans.

Rochester Gas & Electric Corp.
May 8 company announced that, in addition to the pro*
ceeds from the current sale of 175,000 shares of new
common stock to stockholders
(registered May 8 with

June 2 the

(6/24)

reported company expects to do some
debt financing this Fall (under $50,000,000) to replace

Kuhn, Loeb & Co. and Lehman Brothers (jointly); Mor¬
gan Stanley & Co. and Drexel Jc Co. (jointly); The First
Boston Corp. Offering—Postponed.

its

Corp.; Kidder, Peabody & Co., White, Weld &
Lynch, Pierce, Fenner & Beane (jointly);
Union Securities Corp.; Smith, Barney & Co.
!
'
1
Co. and Merrill

Tennessee Gas Transmission Co.

Underwriters—To be determined by competi¬
tive bidding. Probable bidders: Halsey, Stuart & Co.
Inc.;

with

Pacific Co.

Southern

Bids will be received by the company up to noon

March 27 it

new con¬

struction.

from

curities

—For 1953 construction program.

April 14 it

Public Service Co. of Oklahoma
March 2 it was reported company may

the

Examiner

Equitable,Se¬

Corp. and Glore, Forgan & Co. (jointly);

May 1 it

Examiner

decision, subject to Commission review, author¬
izing the company to construct 335 miles of pipeline
in Alabama, Georgia and Florida at an estimated cost
of $8,141,518.
filed

April 29 it

New Hampshire

sell in 1953

writers

Gqs Co.
FPC Presiding

Southwestern Gas & Electric Co.

Service Co. of

Nov.

announced

was

decision, subject to Commission review, author*
izing company to construct approximately 160 miles of
pipeline at an estimated cost of $5,945,000. Securities
may be sold privately through competitive sale.

Natural Gas Co.

Public

filed

Basin

Feb. 4 company filed an

reported company

was

about $300,000 of common stock. Proceeds—For working
capital. Underwriter—Miller Securities Co., New York.
Offering—Indefinitely postponed.

that

1953 will borrow some $125,000,000 from
banks to be refinanced later in year, probably by offer¬
in

N. J.
plans to issue and sell

Shield Chemical Corp., Verona,
March 26 it

Pacific Northwest Pipeline

company

(par $100) and 250 shares

stock (par $100) at the Office of Alien Prop¬
erty, U. S. Court House, Room 115, Foley Square, New
York 7, N. Y.
Max Kade, President of the company, has
agreed to submit a bid for the stock of $650,000.

of preferred

Canada. Underwriter—Morgan

March

stock

shares of common

500

Club

Field

Day

of
at

Country Club
Rye, N. Y.

New

June' 19, 1953 (New Jersey)
Bond

Club

the nual field
and Club.

of New Jersey

day

Rock

an¬

Spring
;

June 19-21, 1953 (Los Ang., Calif.)
June 12, 1953 (New York City)

Security Traders Association of
New York Society of Security Los Angeles annual spring party
Analysts spring festival at the at the Arrowhead Lodge, Lake
Sleepy Hollow Country Club.
Arrowhead, Calif.
June 12, 1953

(Philadelphia, Pa.)

Investment Traders Association
of

Philadelphia annual summer
outing at the Whitemarsh Valley
Country Club.

June 25-26/1953 (Cincinnati, Ohio)
Municipal Bond Dealers Group
of Cincinnati annual

party at the
Country Club June.. 26;
party, Thursday evening

Kenwood
cocktail

June 25.

June 16, 1953 (Detroit, Mich.)
Securities Traders Association Of

Detroit & Michigan, summer out¬
ing at the Plum Hollow Country

June 27, 1953 (Chicago,

111/)

Chicago Bond Traders Club An¬
nual. Spring Outing at the Nordic

Country Club.
corporate purposes, in- Maryland where all of its proper; V
Club.
eluding proposed construction ex- ties are located.
The company
June 28-30, 1953 (Santa Barbara,
penditures
It is presently esti- also is engaged in the sale of gas June 9-12, 1953 (Bigwin, Ontario, June 19, 1953 (Milwaukee, Wis.)
mated
that the company's, con- and
Canada)
electrical
appliances
and
E.0^
Milwaukee AnGroup, of Investment
Investment Dealers* Association nual Field Day of. the Oconomowoc
struction program may require allied merchandise and the proat

Ca?Sa

Ban^ers

expenditures of about $31,000,000

in 1953.

Indications

are

duction

that ex-furnishes

and

sale

electricity

steam.

and

gas

It
in

Canada

Annual

Convention.: Lake

Bigwin inn, Lake of Bays District

Club

Country Club.

and

Association

second

an-

Oconomowoc nual conference at the Santa Barbara Biltmore.

Volume 177

Number 5228... The Commercial and Financial Chronicle

(2563)
fore

expiring,

the stock market

ran

off,

the when-issued

for

the

debentures,

indicated that

10014-100^2,

Decca Records Offer

fair short interest

have accumulated.

may

Decca

relatively

showing

good

this week in face of further mild
in the seasoned bond

nervousness

list

definite

and

in the

weakness

equity market.
the

Perhaps

approach

ipid-year reinvestment
dividuals

season was

institutions and in¬

factor with

the

inclined

anticipate

interest payments and dividends.
At

that

rather

rate

any

indicated

was

formidable

demand

soaking up new issues being
marketed currently with virtually
all of the General Motors Accept¬
was

Corp.'s
intermediate
de¬
bentures, due to be offered today,
having been spoken for.
Consolidated Gas, Electric Light
of Baltimore's $25,-

Co.

Power

000,000 of first and refunding 30-

which the
top bid was separated by only
about $1 a bond from the second
mortgage bonds

year

tender, set the pace.
This issue

•

been

reported to have

was

taken

up quickly with in¬
companies, .savings banks
and pension funds absorbing the
bulk of the bonds at the offering

surance

price of 102.239 for

indicated

yield of 3.75%.
•

•

;

Filling

Carrying top credit rating, Gen¬
Motors
Acceptance
Corp.'s

term

relatively

short-

debentures

(they mature
July 1, 1958) had the further at"traction of that intermediate

ma¬

turity.
-

100%

They
two

will

deemable at
months

non-callable

will

102%

ended

Dec.

then

thereafter to

and

difficult to

remember

diesel

equipment

debentures

will

the

for

porfolios

many

into which it fitted nicely.
The offering today, with pre¬
liminary inquiries indicating
quick oversubscription, was ex¬

priced at

for

par

coupon.

Slower

ported

re¬

but at a
Paying the company
price of 100.56 for 4V2S, the suc¬
cessful banking group
reoffered
at 102 for a yield of 4.35%.

banking

would

groups

three

that

indicated

$320,398,000

the

end

had

been,

group

received.

decided

sumably due to
-

The

third

withdraw

pre¬

The 20-year maturity, which got

at the

end of

April

1953,

1952.

increase

the end

speed

the months,

counted

help

distribution.

000

operation

lowing

the

were

the

results

income

the

and had

1948

increased

342,800 of the

all

total

but

taken

its

This

had

meant

been

that

bankers

by"

who

would

take down the unsold balance for

public

offering. Though
"rights" virtually evaporated

No.

this

One

Louis,
Raton,

Rocky
New

COMMON

Dollar

and

Ce.

1953.
No.

114

BONNYMAN, Treasurer.

Twen¬

PHELPS

PIERCE

meeting
held

•$>

declared

4th,

June

dividend
payable June 29th to
(300)

of Directors has

quarterly dividend of

Sixty-five Cents (654)

directors that

Thursday,

cent

Board

GOVERNOR

of our

last

thirty
declared,
a

DODGE

CORPORATION

;

COMPANY
a

Pacific

June

DIVIDEND

the

The

was

busi¬

($1.25)

109

;

Secretary.

de¬

Company,

THE

Mountain

Mexico,

STOCK

day

-per
share,
being Divi¬
Preferred, Capital Stock
payable AuiMst 1, 1953, out
of
undivided
net profits
for the year ending
June
30,
1953,
to holders of said Preferred
Capital Stock registered on the books of the
Company at the close of business June 26, 1953.
D. C. WILSON, Assistant Treasurer,
120 Broadway, New York 5, N. Y.

dend

closed.

the

capital

was

Corporation,

our

Per

payable

stock

this

June

10,

stockholders of record on June 15th.

1953

FLEECE,

stockholders

of record

May 22, 1953.

pres¬

M. W. URQUHART,

war¬

Treasurer

common

THE COLUMBIA
GAS SYSTEM,

ad¬

are

Board

May 6,1953

INC.

day the following quarterly dividend:

engaged in the busi¬
of

rec¬

the

declared this

has

Directors

Common

Stock

No. 76, 200 per

payable
record

August 15, 1953, to holders of
20, 1953.

close of business July

Dale Parker

the

Mining and Manufacturing

others.

Certain

other

Secretary

June 4, 1953

Phosphate

The Electric Storage Battery

Regular

per

Share.

Regular Quarterly Dividend of
Forty Cents (40c) Per Share.

June 16, 1953.

Checks will be mailed.

Both dividends

1953,

are

payable June 30,

stockholders of record

the

close of business June 19, 1953.

Checks will be mailed.

H. C. ALLAN,

Secretary and Treasurer

Robert P. Resell

Philadelphia, June 5, 1953.

Vice President and Treasurer

were Gilbert Palmer, Na¬
City Bank, Vice-President,

named

tional
and

per

of record

30, 1953, to stockholders

McNelly, Union Bank of Com¬
has been elected President
Society of Secu¬
Other
officers

<$.50)

follows:

45th Consecutive

($1.00)

Common Stock, payable June

the

cents

$5.00 Par Value Common Stock

Accumulated Surplus of the Company

Edward

declared by the

Quarterly Dividend of One Dollar

Consecutive

^dividend of fifty

Elect New Officers

Analysts.

Chemicals

Products

4%Cuimilative 'Preferred Stock

company

The Directors have declared from the

Analysts

were

May 28, 1953,

;

Quarterly Dividend

rity

Foods •

Amino

•

Board of Directors

the
three
moplhs ended.
31, 1953 the company re¬

of the Cleveland

Plant

•

Minerals

Dividends

music
.

—

Potash

subsid¬

the

•

Industrial

Sawyer, Cleveland
Secretary-Treasurer.

Co.,

-tx

Pascal

Trust

w~t-4

INTERNATIONAL MINERALS

& CHEMICAL CORPORATION

investment banking Elected to the executive commitgroup
headed by Blyth & Co.," tee were Paul J. Eakin, HornInc.
The debentures are priced blower
&
Weeks,
Thomas
B.
an

102

and

interest

accrued

yield 4.35%.

Commencing in 1956,
fund

will

issue

operate

retire

the

by maturity.
The
redemption price starts

optional

Proceeds

4y2%

sinking

full

at 106% and scales down

from

the

debentures

annually.

sale

and

from

new

the

sale of 548.000 shares of the util¬

stock

common

will

be used

$48,000,000 in outstand¬
ing short-term bank loans and for
repay

and

operates

owns,

Farmers

Insurance

Co., John M. Marston, Ball, Burge
& Kraus, Richard E. Mayne, Cen¬
tral

National

Bank,

Warner

Cliffs

Iron

Co., Charles A. Hoskin, McDonald & Co., and Paul
M. Murphy, George W. Blauvelt
and David G. Watterson, the three
Past Presidents of the

Society.

The Society also announced that
Western

Reserve

a course next fall to pre¬
specialists in security anal¬

ysis.

WANTED

^ ]r1>

CORPORATION

producers.
expected

increase

Kansas.

owns

system

The Board of Directors of Safe¬

The
than

Permian Basin

also
50% equity in

company
a

Pipeline Co. from

Northern

Natural

purchase

300

cubic feet of gas per

will

milLon

day.

eventually

Operating revenues for the year

the

1952 totaled $47.400 000 and gross

be¬

income

was

$6,502,000.

of Directors

Board

declared the following

has

dividends:

STOCK

Regular quarterly dividend of

the 4
per cent Cumulative Preferred
Stock, payable July 1, 1953 to
$1.0614

share,

per

shareholders

dividend

record

June

holders

Natural

Gas

sires connection.

the

Well

Street.

Chronicle,
New

and

York 7.

Park

Place,

Stock.

June

19,

Common Stock dividends and

dividends

Secretary- Treasurer

the 4% Preferred

Stock and 4%% Convertible

Preferred Stock

July 1, 1953
of record

are

payable

stockholders

the close of bus¬

iness June 17,1953.

MILTON L. SELBY, Secretary

June 3, 1953.

June 2, 1953

Box V 611,

Financial

mon

$1.00 per share on the
4% Preferred Stock.

per

Stock,

John H. Schmidt

WESTCL0X

Commercial

cents

1953.

broad

background in trading.
known

record

stocks, de¬
Has

Common

604 per share on the
$5.00 par value Com¬

$1.12% per share on
the 4%9o Convertible
Preferred Stock.

STOCK

payable July 1, 1953 to share¬

Specializing in Public Utility

way Stores, Incorporated, on
June 2, 1953, declared the

following quarterly dividends:
PREFERRED

COMMON

and

Common and
Preferred Stock Dividends

Dividends
The

points

other

TIME

GENERAL

19, 1953.

TRADER

Chicago 6

14^

University will

present

SITUATION

General Offices: 20 North Wacker Drive,

Taylor, H. C. Wainwright & Co.,
H.
Stuart
Harrison, Cleveland-

pipeline system

extending from natural gas fields
in Texas, Oklahoma and Kansas
to

Ohio

Rowe,

pare

company

maintains

whj^h

"standing

St.

holds to pur¬

now

Cleveland

offering of a new issue
$40,000,000 Northern Natural

construction

stockholders.

Cents

this

has

the

above Company
has declared a dividend
of Fifty Cents per share on the Common Stock
of the
Company to stockholders of record at
the close of business
June
15,
1953, payable
June
30,
1953.
Transfer
books
will
not
be

and

aggregated $933,265.

Public
of

Present

$16,-

dividend

ty-five

Directors

merce,

reporting

clared

1953.

211th

from

the

Board

record

1953.

company

ported net income of $234,685 and
for the full year 1952 net income

Blyth Group Offer

showed
company

CLEVELAND, Ohio

capacity to
825 million cubic feet daily north

interest,

The

topeka

railway

York, N. Y., June 5,

the close of business

chased

sub¬

30,

JOSEPH S. STOUT,
June 8,

The

LANGLEY, Treasurer.

atchison,

santa

operations,

engaged in
publishing business.

scription rights as of the close of
business on Tuesday. The figures
tremendous

current

are

1952.

fol¬

made known

expiration

other than for

corporation's

iaries

in¬

this

(15c) per share
day
on
the capital
payable July 15, 1953

declared
this
the Corporation

June

ness

CORPORATION

cents

Universal, which would

ufactured

in Kansas, Nebraska,
Iowa, Minnesota and South Da¬
kota.
Approximately 83% of its
requirements in 1952 were pur¬

30-year convertible

debentures.

'Yesterday

to any

phonograph
Through a subsidiary,
corporation also engages in

operating

The

investment bankers, opened sub¬
scriptions on "rights" for $162,-

>■

Pictures

403

this

from

$21,063,000

Phillips Pete Debentures

new

used

from

ords.

For

additional construction to increase

Late last month Phillips Petro¬
leum Co., through a syndicate of

the

recording, manufacture and

March

system capacity.

222,000 of

for

distribution

$33,392,000 in 1948
to $125,404,000 in 1952.
Net in¬
come, after all taxes, was $5,583,-

factor

totaled

of 1952.

the

Universal

37,500
of

showed
a
24.7% since

receivables

further

ity's

was

may

this

to stockholders

Secretary-Treasurer

ness

At the end of

turities that has been prevalent in
over

Decca Records Inc. and its sub¬

$1,622,717,000

conflict of ideas.

it out of the "rut" of 30-year ma¬

utility field

funds, to be

purpose

and

sidiaries

1947,

and had increased to

the

running but when the time came
for opening of tenders, only two

held

The

Receivables, after de¬
ducting applicable reserves, were

11)

been

gen¬

NO.

Directors

Company, at
day, declared an interim
dividend
for
the
second
quarter
of
1953,
of
One Dollar ($1.00) a share on the
outstanding
capital
stock
of
this
Company,
payable
on
June 27, 1953, to stockholders of record at the
close of business on June 18, 1953.
Meeting

fifteen

been

stock

1953.

10,

ditional $375,000.

Gas Co. 41/2% sinking fund deben¬
tures is being made today (June

had

the

require the investment of

provide

Up until the day of the bidding

has

chase

for

slower pace.

additional

of the net proceeds

stock

No. Nat. Gas Debs.

were

Board

June

DIVIDEND
The

received

five years.

Absorption

debentures
be moving

the

York

NOTICES

Wall Street, New York

dividend

phonographs, needles and other
accessories, all of which are man¬

Northern Natural Gas Co.'s $40,-

000,000

New
'

will

distribution of phonographs, radio-

Total

to be

added

rants which

additional working capital for the
purchase of receivables. The com¬

creased

pected

Co.

except that the corporation
ently intends to exercise the

The net proceeds from the sale

the

Broadway,

ables

railroads and other industries.
of

Rosario

financing inventories and receiv¬

financing, the re¬
maining 7% being derived from
the financing of other
products,
such as electric refrigerators and
air conditioners,
heating equip¬

were

greater vol¬

automobile

and

purposes

particular

financing than
other finance company in the
States.
During 1952, ap¬
proximately 93% of its business

ment,

present plans for devoting the

excess

United

issue of that duration. And doubt¬
there

any

was

Marks

corporate

securities

of automotive

ume

held.

Co., Inc., will be restored to work¬
ing capital. The corporation has

sidiary of General Motors Corp.,
believes that it does

120

unsubscribed shares.

sale

such

Honduras

$1,000,000 which has been ex¬
pended in additional purchases of

sub¬

offering

time to time be determined by the
board of directors.
The sum of

re¬

including June

which is

company,

opportunity

eral
for

30, 1957, and at 100% thereafter.
The

the

shares will

for

M.
any

proceeds

from

during the six
31, 1955, de¬

$2,023,992,000, ' which

Net

clining V2 of 1% each six months

and

years

York

New

in¬

accrued

3V4

DIVIDEND
NATIONAL

underwriting group
Reynolds & Co. and

Laurence

terest.

last time institutions have had

less

and

each

purchase

has experienced a large ex¬
pansion in its business in the last

eral

$150,000,000

1953.

headed

Morgan Stanley & Co. The deben¬
tures mature July 1,
1958, and are
priced

for

NOTICES

Mining Company

pany

Spot

$150,000,000

tionwide banking group
including
237 investment
firms, headed by

ance

General Motors Acceptance
Corp.
five-year
4%
debentures
was
marketed on June 11 by a na¬

the pending influx of semi-annual

issue

new

New

The subscription offer will expire
at 3:30 p.m. (EDST) on June
25,

Acceptance Debs.
The corporate new issue market

Inc.

318,625 additional shares at $9.20
per
share on the basis of one

Offer General Motors

made

Records

holders of its capital stock of rec¬
ord June 9 rights to subscribe for

Morgan Stanley Group

DIVIDEND

Bankers Underwrite

"quote"

•

BIG BEN

SETH THOMAS

STR0MBERG
HAYD0N

RECORDERS
MOTORS

*59

The Commercial and Financial Chronicle.. .Thursday, June 11, 1953

(2564)

Washington,

••

•

BeTwnJ-tht-Scent Interpretations

tions below the

the difference

that

-i

active

\ gym m

—

The
CrO committee, until recently
called the Committee on Ex¬
penditures in the Executive De¬
partments,
may
inquire into
omy of the administrative meth¬
ods and operational techniques
of any Executive agency, to de¬
termine whether they are being

story
It

Commerce

Banking Com¬
Senate,
which

the

said

would

create

stench

the White House.

and

with

Then

with President

heck

EPT is meantime

fresh

poll

because

these

not asked to

profound

ing

their

decided

least

SEC in many

their

recheck

neutrality"

competitive, private

who

$10,000

hower

in order to get head¬

no basis for
which the staff
make against persons subject to

lines, when there is

Show"

actually

Results

the

•••

spend

1953,

the

yond

its control,

year,

such abuse.

watching eagerly to

"They
make
the
climate
liealthy for their friends and

the

cuahealthy for
enemies," said

Committee to vote to report out
an EPT extension.

Fxplore

Second,
man

into

their

personal

the

Ohio

"the

•

year,

be¬

Truman

treats

something they cannot

affect).

whether

force

current

will

The

ma¬

Mr.

Truman

year's

expendi¬

estimated in January by

will

amount

whole

the

ranks

operation" of
SEC. "Why is it that the whole

for

operation

ministration would

show

build up its case for the

Aid, Trade & The Tariff—How¬
ard S.

York 16,

Congressional commit¬
the press, or on the

that

fact

The

estimated
for

billion

less

less
(and $1.2

year

that

'54),

for

Truman's forecast

Mr.

stated

innumerable occasions by the

the

Eisen¬

effect

net

hower Administration economies
will

far

merely to hold

approxi¬
mately the highest postwar year
of

Truman

spending

spending.
other

the

not made the
upon

the

vigorous attack it

extravagance in gov¬

ernment,

rate

the

actual

spending might have risen much
more than
the $4.5 billion that
Mr. Eisenhower says
with

spending,
Mr.

for the

Truman's

new

radio has used this current year

apparently

member

and

later

so
was

Ike

very

see

themselves

he will re¬

been

safe

crats

to oppose certain

lay in filling their places.

cies

Such

er,

a delay, said Mr. Bend¬
is not conducive to the SEC

fulfilling its function—"its only
function"—the protection of in¬

vestors, he added.
about

the

Congressman,
Small

SEC, said the
is its ineptness.

business,

it almost

said,

impossible

southern

Democratic

the

finds

get

FOREIGN SECURITIES

I
t

cut of

are

firm

Presidents

I
a

Trading Markets

House

relatively
Republican

Conservative

the

Y.—Paper—

Practices and Price

Price

icies—Jules
ald

Pol¬
Ron¬

Company, 15 East 26tb.

Press

Street,

Backman—The

York

New

10,

Y.—

Cloth—$8.
Winning in Wall Street—Ira

Company, Inc., 225 Park Avenue^

N. Y.—$2.00.

TRADING MARKETS
E.

KEITH PR.

PFD.

few
con¬

other hand.

Republicans

can

find themselves pilloried for not

IRVING

SHOE COM.

RIVERSIDE

CEMENT

'B'

COPLAY CEMENT PFD.

I
I

P-ARL MARKS & PP. INC.

I
I

«
s

>•'%

* ■

19 Bread Stmt... New Toft 4, X Y.

%
.*

NATIONAL CO. COMMON
SENECA

FALLS

POLAROID

CORP.

!ir"

W:HA«owr 2-0030

10 Post Office

Tobtypo KT M71

Square, Boston 9,Mass«

Telephone
HUbbard 2-1990

mintMmk

mmrnrn mt.m mmmmmmmmmm

Securities

V
'mm

1ST PFD.

LERNER & CO.
Investment

MACHINE

foreign* Securities Specialists
I

stituencies,

38,

" r

North"

York

$2.50.'

THOS. G. PLANT 1ST PFD.

There

"solid

poration Company, 160 Broadway^

JOHN

tenden¬

" anti-White

Revised

in Korea, Congress is

likely to drive for

secure the re-election of

then

Corporations:

April 21, 1953—United States Cor¬

New York 17,

con¬

threaten, but rather secured

helped

New York Laws Affecting Busi¬
ness

Cobleigh—Dept. 5, David McKay-

because such opposition did not
!

Roslyn, N. Y.—Fabrikoid—$12.50*.

GEO.

Demo¬

7 Democrats.

The thing that impresses him
most

for

—

St.„

durable truce appears to

secure

very

and Influence1

Arthur H. Richland

compared
projections

fiscal year.

thing

dubious spot indeed. It has

Chairman of the SEC resign and

much de¬

—

GEO. E. KEITH JR. PFD.

wins, then these

servatives

the

why there has been

EPT

about the most unpopular

Interested in knowing why did
one

continuance

How to Raise Cash

Bankers

New

hand,

Eisenhower Administration had

has

Street, New, York 5, N. Y*.
—Cloth—$10.

Beaver

Business Reports, Inc., 1 Main

Eisenhower Administration.
So

82:

Bureau,

by these

was

amounts wrong, has been
on

Research

Commodity

1953—-

Year Book:

Commodity

now

billion

$1.5

current

the

revenue

the President could seek.

riow?" he asked. He said he

the

N. Y.—Cloth—$3.75.

it inherited in Federal finances.

Cuts

Piquet—Thomas Y. Crowell

Company, 2 Fourth Avenue, New-

"mess"

Truce Opens Drive for Spending

tees,

deny Mr. Eisenhower,

can

Mr. Truman

tion

GOP

happened, \

run

conservatives

Congress¬

has

at more than
estimated, the Ad¬

were

—

$3.50.

If spend¬

$74.6 billion.

then there will be little that the f

Crum

$74.6

figure

spending

The — William Leonard
University of California
Press, Berkeley 4, Calif.—Cloth—
System,

Ad¬

the

hand,

other

the

duce
current

tures

noteworthy that not a
single Administration presenta¬

If this does

Operation"

declared, he wants to

will

see

jority of the Ways and Means

Mr. Bender.

"Whole

show

per

1954 (and

Administration

new

politically-

pay

billions

$74.1

minded man, woman, and child
in
the
nation's
capital
is

every

estimated

year

the complaints

Naturally

got

hand, Mr. Eisen¬

officially

Administration

his

that

implored

was

has

Age Structure of the Corporate

pensive Truman postwar year.

Federal

during the fiscal
"Road

to
apiece

else

one

some

On the other

stand

by the top Treasury brass.
Watch

have

now

annum.

is interested in harassing

persons,

above their fel¬

initiative they

prior to the time their "at

even

hears, Mr. Bender stated,

own

for

them

to the state of Federal finances,
on

the public pay¬

(reduction in force) no¬
tices and are desperately look¬

several NAM board members as

that

lived

have

who

"RIF"

made

had

impression

scale

life—but

Eisenhower

Mr.
such

lows in the

do—by Treas¬

officials.

Ihem.

cases

roll

asked to do so—since they

ury

Along this line that he wants to
-fiee
if there is any basis for

-that the staff of

comfortably

they

were

in fact making some

cuts

individuals

the six-months

extension of EPT

his

and

expenditures.
Such evidences are any number

in the press reports, the NAM'S

million less than in the most ex¬

ing

city that

Eisenhower

are

definite

Rate

of this

only $500

is that he will spend

billion by implication.

walking evidences

are

streets

Cabinet

contrary impression

Board of Directors did not take

complaints in advance of the
Investigation," said Mr. Bender,
Adding, however, that he had
lieard so very many complaints

the

President

Did Not Pressure NAM

against

prejudging

There
on

that Mr. Eisenhower's best guess

ministration accepts this current

Spend

Truman

Peak

crats have got over

Despite

spending figure, for if it were
the contrast would show

done

year

Ike

will be because Demo¬
their peeve.

out,

pro¬

:vV/.

grams.

against free

and

internationalist

and

later voted

were

not

trade

said

Ike.,

balanced

tax reduction, and

and

reduction

tax

the Democratic Adminis¬

the Democrats got sore, and

President

popular
to be for

yet defeated in their own con¬
stituencies for not voting for

"road

tration had left the finances in,

mission."
*T

seems

budget

Ike's

show," pouring into homes what

unfriendly to the Com¬

persons

GOP,

the

budget, and
backing

things

not

who

said, that
favorites. He

and

"Old P. J. never quite learned how to get away
from business!"

this

spreading further dissension be¬

said, that
"play favorites

six

for

Tax

tween conservative Republicans '

Bender

with its friends
which

to the

and

Ways

the

that ; they,

ing

playing

tends

in
exchange
firms, have been elected

committee, according
exchange announcement.

good strategy, show- :

a mess

Bender,

Mr.

saved Ike's tax and

inquire into "numer¬

complaints,"

SEC

Hoffman

Wm.

partners

ing

"bail

months. Democrats thought

phases of SEC business.

Mr.

all

member

Class B members of the nominat¬

Democrats

Profits

Excess

however, said
that he wants his Public Ac¬
counts subcommittee to go into

Winter

Co.,

Means Committee to extend the

Bender,

SEC

voting

jurisdiction.

fiave legislative

Itears,

term

suitable "war of nerves" wait

operates
Inter¬
Committee of

the House or the

ous

out" President Eisenhower after

would be initiated by the

First,

for

has been announced by

McCormick, President
Exchange.>
Arthur J. Conroy of Conroy &
Co., John J. Miles, Jr., of Adriance
& Finn, and Theodore A.

the original intention

was

House

-laws under which SEC

wants to

committee

year,

the

re¬

Democratic

from

comes

sources:

hon¬

distinguishes
ft
from
a
committee
which
lutings down laws or modifica¬
tions of laws for the Executive
•Agencies to administer. Thus,
-«ny substantive change
in the

two

going

drama

garding Excess Profits Tax (one
is the House Ways and
Means Committee; the other is
the national TV hook-up) this

^housekeeping. This

Mr.

one

stage

sort
watchdog of the government's

and

regular members of the Amer¬

ican Stock Exchange, as Class A
members of the Exchange's nomi¬

Ike

Gilligan,
Garry OnFrederick J. Roth,

McGarry,

Edward T.

This committee is thus a

mittee

derdonk
all

with the two-

connection

threatre

^administering.

state

nating
Irked

Dems

estly, and in conformance with
-fiie law or laws the agency is

Joseph

mittee.

Government Operations.

conducted efficiently and

For American S. E.
The election of James

Bender subcom¬

the

plans

Nominating Comm.

some

As of this writing, how¬
ever, the full committee had not
been
notified of
the inquiry

Public Accounts subcom¬
mittee of the House Committee
on

On
indicated

Bender

ings.

-the

not coincide with
own views.)

"Chronicle's"

'<$<

preliminary work already was
under way and that it would
lead eventually to public hear¬

Chairman

Bender

the

can

Mr.

mission.
Mr.

fir*

< /

ness.

Exchange Com¬

Securities and

capital issue approved so
establish itself in busi¬

risk

Rep.

Republi¬
can,
a seasoned
legislator
serving his seventh term in the
House, announced that he is
4;oing to conduct a thorough in¬
quiry into the operations of the

betwqen an''J

(This column is intended to re-\
fleet the "behind the scene" inter¬
pretation from the nation's Capital

i!Wx

li ' f

is thought M

holding troops there is in
neighborhood of $5 billion.

the

WASHINGTON, D. C.

desired by

in Korea and

war

and may or may

CJeorge Bender, Ohio

in appropria-:

sums

Mr. Eisenhower, for it

M> "

xlIIsli/

fromtheNation'*Capital

•

$5 billion

BUSINESS BUZZ

mmmm*'

Teletype
BS 69